Alcyone Resources is pleased to announce that it has signed a term sheet (subject to final documentation) with a global resources investment fund for a rolling A$10M prepay facility. The facility will provide long-term, cost competitive funding to underpin the financial and operational strength of Alcyone’s Texas Silver Operations in south-east Queensland. The facility will represent debt, with repayments to be made by way of 100% of the Company’s off-take while a balance under the facility remains outstanding. The Investor’s commitment is subject to final documentation with a targeted draw- down date of the end of April.

In addition, the Company has today completed a bridge placement of $475,000, of which $250,000 was invested by way of a convertible note and a further $225,000 by way of shares with attaching 6 cent AYNO options. Furthermore, it has today satisfied some of its obligations by way of an issuance of $750,000 in convertible notes. The terms of both Convertible Notes do not permit for shares to be issued, and there is no agreement to issue shares, if shareholder approval is first required under the ASX Listing Rules. Further details of the securities issued today can be found in the Appendix 3B that follows.

As previously advised, Alcyone is currently working towards completion of a larger, up to  $2.5 million, bridging finance by the issue of promissory convertible notes (see ASX Announcement – 22 March 2013). The Company and the investors are working towards completion of definitive documents to close and fund the bridge. This is anticipated to occur within the next few days. In parallel with the financial restructure, Alcyone is continuing to implement corporate and operational changes aimed at reducing corporate overheads and increasing both short and longer term revenues from production at the Texas Silver Operations in south-east Queensland. These include operational improvements and plant and equipment upgrades that will enable the operation to achieve increased throughput and reduce its operating overheads.

A further update on these initiatives will be made to the market in April 2013, together with an update on the Company’s longer-term financing arrangements. Alcyone Chairman Paul D’Sylva said the completion of the financial restructure would provide the Company with a strong, stable and competitive source of funding, enabling it to realise the full potential of the Texas Silver Operations and establish strong financial and operating foundations for long-term growth. “As part of this strategy, a substantial portion of the proceeds will be used to implement the operational improvements and plant and equipment upgrades we have identified, while at the same time ensuring that we have sufficient working capital in place at all times to cement the future of the operation,” Mr D’Sylva said. “This package will deliver the Company the financial stability it needs to maximise its outstanding growth opportunities,” he added.