Cobalt Coal Ltd.

Cobalt Coal Ltd.

February 10, 2012 19:25 ET

Cobalt Coal Ltd. Announces the TSX-V Private Placement of Convertible Debentures

CALGARY, ALBERTA--(Marketwire - Feb. 10, 2012) - Cobalt Coal Ltd. (formerly Cobalt Coal Corp.) (TSX VENTURE:CCF) ("Cobalt" or the "Corporation") is pleased to announce that it intends to complete a private placement of up to $1,000,000 of convertible redeemable debentures (the "Debentures"), which will mature 24 months from the date of issuance (the "Maturity Date") and will bear interest at a rate of 12% per annum payable on the Maturity Date (the "Debenture Offering").

The Debentures will be convertible into units (the "Units") with each Unit comprised of one common share of the Corporation and one warrant, containing certain vesting conditions, to acquire a common share of the Corporation at an exercise price of $0.20, on the basis of 6,666 Units per $1,000 principal amount of Debentures and interest, subject to regulatory approval.

The Corporation intends to use the proceeds from the Debenture Offering to pursue acquisition opportunities for the Corporation, general working capital and the payment of expenses related to the Debenture Offering.

The Debenture Offering is subject to the approval of the TSX Venture Exchange. Pursuant to applicable securities laws, all securities issued pursuant to the Debenture Offering will be subject to a hold period of four months following the closing of the Debenture Offering.

About Cobalt

Cobalt is a publicly traded coal exploration and production company headquartered in Calgary, Alberta, Canada with a regional office in Welch, West Virginia, USA. Cobalt was created to capitalize on the growth opportunities that exist in the metallurgical coal mining industry.

The securities of Cobalt being offered have not been, nor will be, registered under the United States Securities Act of 1933, as amended, and may not be offered or sold within the United States or to, or for the account or benefit of, U.S. persons absent U.S. registration or an applicable exemption from U.S. registration requirements. This release does not constitute an offer for sale of securities in the United States.


Statements in this news release may contain forward-looking information including the use of proceeds from the Debenture Offering and the timing of closing of the Debenture Offering. The reader is cautioned that assumptions used in the preparation of such information may prove to be incorrect. Events or circumstances may cause actual results to differ materially from those predicted, a result of numerous known and unknown risks, uncertainties, and other factors, many of which are beyond the control of the Corporation. These risks include, but are not limited to, the risks associated with the coal mining industry, commodity prices and exchange rate changes. Industry related risks could include, but are not limited to, operational risks in exploration, development and production, delays or changes in plans, risks associated to the uncertainty of reserve estimates, health and safety risks and the uncertainty of estimates and projections of production, costs and expenses. The reader is cautioned not to place undue reliance on this forward-looking information.

Neither TSX Venture Exchange nor its Regulation Service Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.

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