Formation Capital Corporation

Formation Capital Corporation

February 28, 2005 09:15 ET

Formation Closes $10 Million Financing




FEBRUARY 28, 2005 - 09:15 ET

Formation Closes $10 Million Financing

VANCOUVER, BRITISH COLUMBIA--(CCNMatthews - Feb. 28, 2005) - Formation
Capital Corporation (Formation)(TSX:FCO) (the "Company") is pleased to
announce that, further to its news releases of January 26 and February
10, 2005, it has successfully completed a $10,000,000 private placement
financing. The private placement was over subscribed.

The Company engaged Jennings Capital Inc. and Raymond James Ltd. to
complete a private placement of up to 25,000,000 Units of the Company to
qualified investors at a price of $0.40 per Unit (the "Financing").
Each Unit was comprised of one common share and one half of one
non-transferable common share purchase warrant. Each whole common share
purchase warrant entitles the purchase of one common share of the
Company at a price of $0.60 per share for a period of two years from the
date of closing of the Financing, unless, at any time following June 26,
2005, the closing price of the common shares of the Company on the
Toronto Stock Exchange is greater than $1.00 for twenty or more
consecutive trading days, in which event the Company may give notice to
the holders of the warrants that the expiry date for exercise of the
warrants has been accelerated, in which case the warrants will expire on
the twentieth day following the date of such a notice. The Company paid
a cash commission to the agents and issued Brokers' Warrants entitling
the purchase of up to 1,662,500 common shares of the Company at a price
of $0.57 per share for a period of two years from the date of closing of
the Financing.

The common shares and warrants issued in connection with the Financing
will not be registered under the United States Securities Act of 1933,
as amended, and may not be sold or offered for sale in the United States
or otherwise distributed in the United States, except in reliance on
available registration exemptions.

Proceeds from the private placement will be used on the Company's 100%
owned Idaho Cobalt Project to assist in the completion of the permitting
process, the bankable feasibility study and for general working capital.

Formation Capital Corporation is dedicated to the principles of
environmentally sound mining and refining practices, and believes that
environmental stewardship and mining can co-exist. The Company trades
on the Toronto Stock Exchange under the symbol FCO.

Formation Capital Corporation

"Mari-Ann Green"

The statements contained in this news release in regard to Formation
Capital Corporation that are not purely historical are forward-looking
statements within the meaning of the Private Securities Litigation
Reform Act of 1995, including Formation Capital Corporation's beliefs,
expectations, hopes or intentions regarding the future. All
forward-looking statements are made as of the date hereof and are based
on information available to the parties as of such date. It is
important to note that actual outcome and the actual results could
differ from those in such forward-looking statements. Factors that
could cause actual results to differ materially include risks and
uncertainties such as technological, legislative, corporate, commodity
price and marketplace changes.


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