Coalcorp Provides Updated Default Status Report

TORONTO, Feb. 3 /CNW/ - Coalcorp Mining Inc. ("Coalcorp" or the "Company") (TSX-CCJ) is providing its ninth Default Status Report in accordance with National Policy 12-203: Cease Trade Orders for Continuous Disclosure Defaults ("NP 12-203"). On September 16, 2009, the Company announced that it would be delayed in the filing of its annual financial statements and related MD&A for the financial year ended June 30, 2009 (the "Annual Financials") and 2009 Annual Information Form beyond their filing deadlines of September 28, 2009.

On December 16, 2009, Coalcorp announced that it filed its Annual Financials, however remained delayed in the filing of its 2009 Annual Information Form. The Company also announced on that date that it was delayed in the filing of its first quarter interim financial statements, CEO and CFO certifications and related management discussion and analysis (MD&A) for the three month period ended September 30, 2009 (the "First Quarter Interim Financials") beyond the filing deadline of November 16, 2009.

On October 19, 2009, the Ontario Securities Commission (the "OSC") issued a management cease trade order related to the Company's securities against the Chief Executive Officer of the Company with respect to the delayed filing of the Annual Financials and 2009 Annual Information Form. The management cease trade order will remain in effect for so long as the 2009 Annual Information Form and First Quarter Interim Financials are not filed. The issuance of such management cease trade order does not affect the ability of persons to trade in their securities of Coalcorp, other than the Chief Executive Officer. However, the OSC, in its discretion, may determine at a later time that it would be appropriate to issue a general issuer cease trade order affecting all of the Company's securities.

    
    Update Matters
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The Company reports the below matters which are material changes to the information contained in the eighth default status report issued by the Company on January 7, 2010.

    
    Announcement of Special Meeting and Related Management Changes
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On January 14, 2010, Coalcorp announced the calling of a special meeting of shareholders to be held in Toronto on February 11, 2010 (the "Special Meeting"). At the Special Meeting, shareholders will be asked to approve the previously announced proposed sale by Coalcorp, through certain of its subsidiaries, of the La Francia I mine and related infrastructure assets as well as all of the issued and outstanding shares of Adromi Capital Corp., the holder of the La Francia II concession, to a subsidiary of the Goldman Sachs Group, Inc. (the "Proposed Transaction")

On that date Coalcorp also announced the resignations of John Malysa, Chief Operating Officer and Joseph Belan, Interim Chief Executive Officer. Mr. Belan will remain as a director of Coalcorp and was appointed as Executive Vice Chairman to continue his employment with the Company to oversee and assist with the completion of the Proposed Transaction. Juan Carlos Gomez, the Company's former General Counsel and Secretary was appointed as new Interim Chief Executive Officer to manage the business of Coalcorp during the period up to the completion of the Proposed Transaction.

    
    Receipt of Letter Threatening Potential Proceedings
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On January 18, 2010, Coalcorp announced that it received a letter from counsel for Blue Pacific Assets Corp. ("Blue Pacific"), advising Coalcorp that unless certain conditions were met, that Blue Pacific would commence proceedings against Coalcorp, including seeking injunctive relief to prevent the completion of the Proposed Transaction.

    
    Receipt of Notice of an Application to OSC
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On January 20, 2010, Coalcorp announced that it received notice from counsel to certain members of former management of Coalcorp that they had submitted an application to the OSC for an order under Section 127 of the Securities Act (Ontario) requiring Coalcorp to obtain "minority approval", as such term is defined in Multilateral Instrument 61-101, of the Proposed Transaction at the Special Meeting.

    
    Filing of Management Information Circular for Proposed Transaction
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On January 20, 2010, Coalcorp announced that it filed the Management Information Circular for the Special Meeting to approve the Proposed Transaction.

    
    Motion Seeking Injunction to Prevent Proposed Transaction
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On January 28, 2010, Coalcorp announced that it had been served by counsel for Blue Pacific with a statement of claim and a notice of motion seeking an injunction to stop the Proposed Transaction.

    
    Independent Proxy Advisory Firms Recommend Shareholders Support Proposed
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    Transaction
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On January 28, 2010, Coalcorp announced that both the Institutional Shareholder Services Inc. unit of RiskMetrics Group and Glass Lewis & Co. issued reports recommending shareholder support for the Proposed Transaction.

    
    Non-Payment of December Interest Payment on Senior Notes Within 30 Day
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    Cure Period
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On January 31, 2010, Coalcorp announced that it did not make a USD$6.9 million interest payment on its 12% senior secured notes (the "Senior Notes") due on December 31, 2010 (the "December Interest Payment"), within the required 30 day cure period which ended on January 31, 2010.

Provided that the Proposed Transaction is completed, the Company will pay the December Interest Payment and the interest accrued thereon to the holders of Senior Notes as of the record date applicable to the December Interest Payment under the terms of the note indenture governing the Senior Notes.

    
    Execution of Settlement Agreement with Former Management
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On February 1, 2010, Coalcorp announced that it and Xira Investment Inc. and members of former management of Coalcorp and other parties to various claims amongst them, entered into a settlement agreement to settle all matters in dispute. The settlement agreement requires the parties to deliver certain documents by February 8, 2010. As part of the settlement agreement, Xira has agreed to pay $34 million over time. Pending delivery of the documents on February 8, 2010, the parties agreed to bring to a standstill all outstanding litigation and proceedings involving the parties, including the proceedings commenced by Blue Pacific, and the former management group agreed to cease its opposition to the Proposed Transaction.

The Company confirms that, except as described herein and in its initial default announcement and its subsequent default status reports: (i) there has been no material change to the information set out in its initial default announcement filed pursuant to NP 12-203; (ii) there has been no failure by the Company in fulfilling its stated intention with respect to satisfying the provisions of the alternative information guidelines set out in NP 12-203; (iii) there is no actual or anticipated specified default subsequent to that disclosed in the initial default announcement; and (iv) there is no other additional material information concerning the affairs of the Company that has not been generally disclosed.

The Company will continue to provide bi-weekly updates, as required by NP 12-203, until the required filings have been made and the Company is no longer in default.

Coalcorp is currently a coal mining, exploration and development company with interests in the La Francia coal mine and related infrastructure projects and a number of coal exploration properties, all located in Colombia. Coalcorp also holds a 60% equity interest in Carbones Colombianos del Cerrejon which owns the La Caypa coal mine in Colombia. Further information can be obtained by visiting our website at www.coalcorp.ca or under the Company's profile at www.sedar.com.

Statements made in this news release may be forward-looking and therefore subject to various risks and uncertainties. Certain material factors or assumptions are applied in making forward-looking statements and actual results may differ materially from those expressed or implied in such statements. Coalcorp does not undertake to update any forward-looking statements; such statements speak only as of the date made.

SOURCE Coalcorp Mining Inc.

For further information: For further information: Juan Carlos Gomez, Interim Chief Executive Officer, +57-1-658-5050 Ext: 9990

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