Why does this code compile without error even though the class is marked Obsoleted?

Question

This is Visual Studio 2008. Obviously has to do with the static class for an extensions.

public class Dummy
{
    public readonly int x;

    public Dummy(int x)
    {
        this.x = x;
    }

    public override string ToString()
    {
        return x.ToString();
    }
}

[Obsolete("Do Not Use", true)]
public static class Extensions
{
    public static int Squared(this Dummy Dummy)
    {
        return Dummy.x * Dummy.x;
    }
}

class Program
{
    static void Main(string[] args)
    {
        var d = new Dummy(42);
        Console.WriteLine(String.Format("{0}^2={1}", d, d.Squared()));
    }
}