| | Thu May 7, 2009
Farallon & Credit Suisse Agree To Us$30 Million Term Loan Commitment
|
| | Proceeds to pay off Notes issued in September 2008
NOT FOR DISTRIBUTION TO U.S. NEWS WIRE SERVICES
OR DISSEMINATION IN THE UNITED STATES
May 7, 2009 Vancouver, BC. Farallon Resources Ltd. ("Farallon" or the "Company") (TSX: FAN) announces that it has signed a binding term sheet (the "Agreement") with Credit Suisse - Zurich of Switzerland ("Credit Suisse"), whereby Credit Suisse will lend the Company up to US$30 million in the form of a four-year term loan. The proceeds will be used to refinance imported equipment related to the construction and commissioning of the 1,500 tpd mine and mill at G-9. The equipment was originally financed with Promissory Notes (the "Notes") which are due to mature on September 9, 2009. The Agreement has standard terms and conditions for an agreement of this nature and will be subject to due diligence and final legal documentation. Closing is expected to occur on or about June 1, 2009, at which time, Farallon will initiate early repayment of the Notes.
As part of Farallon's ongoing objective to strengthen its balance sheet, the Company has been actively pursuing a number of options to re-finance the Notes. This Agreement with Credit Suisse enables the Company to do so much earlier than anticipated and at significantly reduced borrowing cost. Closing of the facility with Credit Suisse and the repayment of the Notes will move the Company's modest debt level from a short-term liability to a long-term liability, thereby improving its working capital position. With a strong asset base and minimal long-term debt, Farallon will have achieved the objective of restructuring its balance sheet and positioning itself for future growth.
Dick Whittington, President and CEO, said: "I am extremely pleased to be able to establish a banking relationship with Credit Suisse. They are a first ranking bank with a strong presence in the mining industry. We look forward to finalizing the facility and having Credit Suisse play a prominent role in our growth profile in the future. I am also very pleased to have reached this agreement at a time of continued turmoil in banking and equity circles, reinforcing our belief that we have a first class asset at G-9 and that this asset can be used as a platform for growth, even in the most difficult circumstances."
Farallon's G-9 zinc, copper, silver, gold and lead mine at its Campo Morado Property in Mexico reached commercial production in April 2009. The Company expects to produce at an annualized rate of 120 million pounds of zinc and 15 million pounds of copper for the remainder of 2009. The Company's ultimate goal is to be a low-cost, multi-mine, mid-tier mining company.
For further details on Farallon Resources Ltd., please visit the Company's website at www.farallonresources.com or contact Investor Services at (604) 638-2160 or within North America at 1-800-667-2114.
ON BEHALF OF THE BOARD OF DIRECTORS
J.R.H. (Dick) Whittington
President & CEO
No regulatory authority has approved or disapproved the information contained in this news release
Forward Looking Information
This release includes certain statements that may be deemed "forward-looking statements." All statements in this release, other than statements of historical facts, that address future production, reserve or resource potential, continuity of mineralization, exploration drilling, operational activities, production rates, costs to completion and events or developments that the Company expects are forward-looking statements. Although the Company believes that the expectations expressed in such forward looking statements are based on reasonable assumptions, such statements are not guarantees of future performance and actual results or developments may differ materially from those in the forward looking statements and may require achievement of a number of operational, technical, economic, financial and legal objectives. The likelihood of continued future mining at Campo Morado is subject to a large number of risks, including obtaining lower than expected grades and quantities of mineralization and resources, lower than expected mill recovery rates and mining rates, changes in and the effect of government policies with respect to mineral exploration and exploitation, the possibility of local disputes including blockades of the company's property, the possibility of adverse developments in the financial markets generally, fluctuations in the prices of zinc, gold, silver, copper and lead, obtaining additional mining and construction permits, preparation of all necessary engineering for ongoing underground and processing facilities as well as receipt of additional financing to fund mine construction, development and operation, if needed. Such funding may not be available to the Company on acceptable terms or on any terms at all. There is no known ore at Campo Morado and there is no assurance that the mineralization at Campo Morado will ever be classified as ore. For more information on the Company and the risk factors inherent in its business, investors should review the Company's Annual Information Form at www.sedar.com. |
| |
| | You can view the Next News Releases item: Mon May 25, 2009, Farallon Announces Corporate Name Change
You can view the Previous News Releases item: Tue Apr 21, 2009, Farallon Announces First Quarter Production Results and Conference Call
|
|
| |
