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Corsa Capital Ltd. Update On Wilson Creek Acquisition Transaction


October 29, 2010

NOT FOR DISSEMINATION IN THE UNITED STATES OR FOR DISTRIBUTION TO U.S. NEWSWIRE SERVICES AND DOES NOT CONSTITUTE AN OFFER OF THE SECURITIES DESCRIBED HEREIN

October 29, 2010 Toronto, Ontario – Corsa Capital Ltd. (TSXV: CSO) (“Corsa” or the “Corporation”) is pleased to provide an update on the acquisition announced in the Corporation’s press release dated August 17, 2010.  As previously announced, the Corporation entered into an agreement dated August 16, 2010 (the “Agreement”) with Wilson Creek Energy, LLC (“Wilson Creek”) and the owners of Wilson Creek, pursuant to which Corsa will acquire Wilson Creek (the “Acquisition Transaction”), subject to the terms and conditions of the Agreement.

Private Placement

As announced on September 30, 2010, the Corporation’s private placement of 154,319,800 subscription receipts was successfully completed on September 30, 2010 for gross proceeds of $69,443,910.  The net proceeds will be released from escrow and delivered to the Corporation on satisfaction of the release conditions specified in the subscription receipt indenture entered into between the Corporation, Cormark Securities Inc., GMP Securities L.P. and Computershare Trust Company of Canada, including satisfaction of conditions to the completion of the Acquisition Transaction.

Bridge Financing

In addition, the Corporation has completed the previously announced loan arrangement pursuant to which two investors have advanced to the Corporation an aggregate principal amount of U.S.$5 million, evidenced by a debenture.  The funds were advanced in two equal tranches, with the first advance completed on September 24, 2010 and the second advance completed on October 15, 2010.  An aggregate of 2,000,000 common shares of the Corporation were issued in connection with the debenture.

Coal Preparation Plant

Construction of Wilson Creek’s coal preparation plant (the “Coal Preparation Plant”) is proceeding on schedule and on budget.  The Coal Preparation Plant is expected to be completed and commissioned by the end of the first calendar quarter of 2011. 

New Mining Lease

Subject to the execution of the agreement, Wilson Creek entered into an option to enter into a lease (the “Garrett Lease”) in respect of certain coal mining rights.  The Garrett Lease must be exercised by Wilson Creek by November 9, 2010.  Once the option is exercised, Wilson Creek will have the right to extract the coal from the Upper Freeport Seam under an approximately 869.43 acre parcel in Somerset County, Pennsylvania.  This project is located approximately 9 miles from the site of the Coal Preparation Plant.  Coal royalties are payable to the landowner on production from this site.

Other

The completion of the Acquisition Transaction is subject to approval of the TSX Venture Exchange (the “TSXV”) and requires the approval and filing of a Filing Statement.   Review of the Corporation’s application for approval is proceeding.  Once the Filing Statement has been approved by the TSXV, the Corporation will seek shareholder approval for the Acquisition Transaction (by way of consent in writing from holders of a majority of its shares).  The Corporation and the members of Wilson Creek would then be in a position to complete the acquisition once all conditions to the Acquisition Transaction have been satisfied or waived.  

The Corporation will provide further details in respect of the Acquisition Transaction in due course by way of press release as required under the policies of the TSXV. 

The Corporation’s common shares are listed for trading on the TSXV.  However, in accordance with TSXV policy, the Corporation’s common shares are currently halted from trading and the Corporation expects that trading in the common shares of the Corporation may remain halted pending completion of the Acquisition Transaction.

For further information please contact:

Corsa Capital Ltd.:

Contact: 
Donald K. Charter
Corsa Capital Ltd.
604-646-4527
communication@corsacapital.com
www.corsacapital.com 

 

About the Corporation

The Corporation is a Vancouver, BC based mineral resources company.  The Corporation’s management team, board of directors, and advisory board, have significant experience in mineral resource property acquisition, finance, and operations.  The Corporation’s team has specific experience in developing and mining coal deposits.

Cautionary Note

As noted above, completion of the Acquisition Transaction is subject to a number of conditions, including but not limited to, acceptance by the TSXV and approval of the shareholders of the Corporation. The Acquisition Transaction will only close once the required approvals and documentation noted in this press release have been obtained. There can be no assurance that the Acquisition Transaction will be completed.

Investors are cautioned that, except as disclosed in the Filing Statement to be prepared in connection with the Acquisition Transaction, any information released or received with respect to the Acquisition Transaction may not be accurate or complete and should not be relied upon.  The trading in the securities of the Corporation should be considered highly speculative.

Forward-Looking Statements

Certain information set forth in this press release contains “forward-looking statements”, and “forward-looking information” under applicable securities laws. Except for statements of historical fact, certain information contained herein constitutes forward-looking statements which include management’s assessment of Wilson Creek’s future plans and operations and are based on Wilson Creek’s current internal expectations, estimates, projections, assumptions and beliefs, which may prove to be incorrect. Some of the forward-looking statements may be identified by words such as “expects” “anticipates”, “believes”, “projects”, “plans”, and similar expressions. These statements are not guarantees of future performance and undue reliance should not be placed on them. Such forward-looking statements necessarily involve known and unknown risks and uncertainties, which may cause Wilson Creek’s and the Corporation’s actual performance in future periods to differ materially from any projections of future performance or results expressed or implied by such forward-looking statements. These risks and uncertainties include, but are not limited to: the risks that regulatory and shareholder approvals will not be obtained on a basis satisfactory to the Corporation; the risk that the Acquisition Transaction will not be completed by the date specified in the Agreement dated August 16, 2010; the risk that certain conditions to the Acquisition Transaction will not be satisfied; the risk that the option in respect of the Garrett Lease will not be exercised; and the risk that the Coal Preparation Plant will not be completed by the end of the first calendar quarter of 2011 or completed on budget.  There can be no assurance that forward-looking statements will prove to be accurate, as actual results and future events could differ materially from those anticipated in such statements. The reader is cautioned not to place undue reliance on forward-looking statements.

The TSX Venture Exchange has in no way passed upon the merits of the proposed transaction and has neither approved nor disapproved the contents of this press release.  Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.

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