How Lightning Works ?

Although there is still some debate in the scientific community about how the electrification of clouds actually occurs, it is agreed that the separation of positive and negative charges must occur within a cloud for lightning to take place. It is also generally agreed that ice must be present within a developing storm for it to eventually form lightning.
The turbulent wind environment of a thunderstorm with its updrafts and downdrafts is an ideal environment to separate electric charges: negative charges generally gather near the base of the cloud, while positive charges build in the upper reaches of the cloud. This allows electric fields to form and grow between the cloud and the ground and within the cloud itself - all necessary conditions for lightning to occur.

Since similar-charged objects repel each-other and opposite-charged objects attract each other, negative charges then begin to spread out near the base of the cloud. At the same time, positive charges start to build underneath the storm. This region of positive charges travels underneath the cloud, almost like a shadow. The positive charges tend to concentrate on tall objects, like trees, poles and buildings.

What causes iron, nickel, and cobalt to be attracted to magnets, but not other metals?

 The magnetic properties of a material are governed entirely by the configuration of the electrons in that material.  In metals there are two types of electrons: bound electrons and free electrons.  The free electrons are free to move between atoms, and are the cause of conductivity in metals.  The bound electrons are stuck to the individual atoms.

Each electron, in addition to having charge, also has a “magnetic moment” which is a fancy way of saying that it’s a tiny bar magnet.  Generally the bound electrons will be paired off in opposite spin pairs.  This is like putting a North-South magnet next to a South-North magnet.  They almost completely cancel each other out.  However, sometimes (in iron, nickel, and cobalt for example) you’ll have one or more un-paired electrons.  The magnetic fields of these electrons aren’t canceled out by another, oppositely-oriented, electron.  As such they lend an overall magnetic field to the atom they inhabit.