29 January 2014By e-lodgmentCONTINENTAL COAL EXECUTES BINDING TERM SHEET FOR $5 MILLION OF LIMITED RECOURSE BRIDGE FUNDINGContinental Coal Limited (ASX: CCC; AIM: COOL) ("the Company") announces thatit has executed a binding term sheet with UK corporate advisory firm, EmpireEquity Limited ("Empire Equity"), to provide $5 million ("Investment Amount")of limited recourse bridge funding. The funds raised will be applied towardsgeneral operating expenses and payments to creditors of the Company that do nototherwise agree to standstill agreements, allowing the Company to continuetrading as a going concern while it continues to seek to undertake a broaderrecapitalisation and restructure of the Company and its financial arrangements.Subject to finalising definitive documentation, Empire Equity and/or itsnominees (the "Investors") will invest in 7.5 million unsecured convertiblepromissory notes ("Notes") with a face value of A$1.00 at a discounted issueprice of A$0.6667 per Note and with a maturity date of 4 months post closing.The Investors have also undertaken to assist the Company in undertaking arights issue currently proposed to raise up to A$28 million at an offeringprice of A$0.01 per share (terms to be finally determined by the Company andthe underwriter engaged), including procuring underwriting of the rights issue,with proceeds to be used to settle amounts owed by the Company to variousexisting convertible note holders and other major creditors. The Notes are onlyredeemable upon successful completion of the rights offer, being fullsubscription including underwriter subscriptions, upon which the Investors willhave the option to redeem the Notes by either conversion into shares in theCompany (subject to obtaining necessary shareholder approvals) at a conversionprice equal to the rights offering price or request payment of the A$7.5million face value in cash. The Investors are also required to procurestandstill agreements for 90 days from convertible note holders and other majorcreditors of the Company to allow for the completion of the rights offering orother recapitalization.The Investors will receive a 6% fee on the Investment Amount as well as 70million options, subject to shareholder approval, for providing the $5 million.Each option will be exercisable at the rights offering price with 3 years toexpiry. In the event that shareholder approval is not obtained to deliver theoptions, $500,000 in cash will become payable to the Investors in lieu of theoptions. 100 million shares will also be issued to a settlement agent and heldin escrow as collateral, either to be sold in the event of default withproceeds to be paid to the Investors, or if no default occurs, transferred toapplicants under the rights issue.Proposed Board and Management changesA condition to providing the funding is the resignation or termination of theCEO, CFO and non executive directors Mike Kilbride and Johan Bloemsma onclosing. To join the Board on closing of the transaction and subject to anyrequired regulatory approvals are: * Peter Landau, who is a former executive director of the Company, having resigned in May 2013. It is also noted that companies of which Mr Landau is a director or major shareholder are significant trade creditors or the Company, being owed approximately $2.8 million; * Paul D'Sylva, who is the Venture Partner of Empire Equity; * Mike Gibson, who is currently the CEO of Genet South Africa, a mineral resources and mining service company; and * a nominee from the creditors group.Further details on the proposed new directors, including information requiredunder the AIM rules for companies, will be provided on or prior to theirappointment.The management structure of the Company will be finalized after closing of thefunding and further consideration by the new board.ASX and AIM Share Trading SuspensionsThe shares of the Company will remain suspended from trading on both the ASXand AIM markets. The reconstituted Board of Directors will consider a decisionon seeking to lift the suspension of the shares following the closing of thetransaction and pending the provision of further clarification of its financialposition to the market.Indicative timingClosing is currently expected to take place with the delivery of the InvestmentAmount in cleared funds by Wednesday 29 January 2014 to a settlement/escrowagent who is to ensure payment to various trade creditors. The remaining fundswill be deposited into the operating bank account of the Company to fundon-going operating expenses while it completes the proposed rights offering.For and behalf of the BoardDon TurveyChief Executive OfficerFor further information please contact:Investors/ shareholdersDon TurveyChief Executive OfficerLou van VuurenChief Financial OfficerT: +27 11 881 1429E: admin@conticoal.comW: www.conticoal.comMedia (Australia)David TaskerProfessional Public RelationsT: +61 8 9388 0944Nominated AdvisorStuart LaingRFC Ambrian LimitedT: +61 8 9480 2500BrokersJeremy Wrathall / Chris Sim Jonathan WilliamsInvestec Bank plc RFC Ambrian LtdT: +44 20 7597 4000 T: +44 203 440 6817About Continental Coal LimitedContinental Coal Limited (ASX:CCC/AIM: COOL) is a South African thermal coalproducer with a portfolio of projects located in South Africa's major coalfields including three operating mines, the Vlakvarkfontein, Ferreira andPenumbra Coal Mines, producing approx. 2.2Mtpa of thermal coal for the exportand domestic markets. A Feasibility Study was also completed on a proposedfourth mine, the De Wittekrans Coal Project.Forward Looking StatementThis communication includes certain statements that may be deemed"forward-looking statements" and information. All statements in thiscommunication, other than statements of historical facts, that address futureproduction, reserve potential, exploration drilling, exploitation activitiesand events or developments that the Company expects to take place in the futureare forward-looking statements and information. Although the Company believesthe expectations expressed in such forward-looking statements and informationare based on reasonable assumptions, such statements are not guarantees offuture performance and actual results or developments may differ materiallyfrom those in the forward-looking statements and information. Factors thatcould cause actual results to differ materially from those in forward-lookingstatements include market prices, exploitation and exploration successes,drilling and development results, production rates and operating costs,continued availability of capital and financing and general economic, market orbusiness conditions. Investors are cautioned that any such statements are notguarantees of future performance and actual results or developments may differmaterially from those stated.