Canada Coal Announces Proposed Business Combination With Suntricity Corporation - Seite 2

Canada Coal will change its name to Suntricity Holdings Inc. (or such other name as Suntricity may determine).

All existing Canada Coal options shall be cancelled.

The current directors and officers of Canada Coal will resign and will be replaced with designates of Suntricity.

It is intended that the Transaction will result in Suntricity becoming a wholly-owned subsidiary of the Resulting Issuer by way of a "three-cornered amalgamation" whereby Suntricity will amalgamate with a newly-incorporated wholly-owned subsidiary of Canada Coal and the holders of shares of Suntricity will receive common shares of Canada Coal on a one-for-one basis. For the purpose of the Transaction, Suntricity has an estimated valuation of approximately US$18.8 million and it is expected that Canada Coal will issue to the shareholders of Suntricity, on a post consolidation basis, approximately 15.0 million common shares at a deemed price of US$1.25 per share. Assuming completion of the Minimum Private Placement, it is anticipated that current Canada Coal shareholders, current Suntricity shareholders and subscribers under the Minimum Private Placement will hold approximately 11.0%, 70.3% and 18.7% of the common shares of the Resulting Issuer, respectively, upon completion of the Transaction.

Completion of the Transaction remains subject to a number of conditions, including receipt of necessary TSX-V and regulatory approvals, approval by the shareholders of each of the Company and Suntricity, completion of satisfactory due diligence by the Company and Suntricity, completion of definitive legal documentation, including a definitive transaction agreement (the "Definitive Agreement") and completion of the Minimum Private Placement.

The Company intends to hold a special meeting of shareholders to approve certain matters ancillary to the Transaction, including a consolidation of the common shares of the Company, and a change in its name to Suntricity Holdings Inc. (or such other name as Suntricity may determine). The Company intends to obtain shareholder approval of the Transaction by way of consent from the holders of more than 50% of its Common Shares and accordingly will prepare and file a filing statement in respect of the Transaction in accordance with the policies of the TSX-V.