Alhambra Reaffirms Previously Announced C$5.0 Million Financing

CALGARY, ALBERTA--(Marketwired - Feb 10, 2014) - Alhambra Resources Ltd. (TSX VENTURE:ALH)(PINKSHEETS:AHBRF)(FRANKFURT:A4Y) ("Alhambra" or the "Corporation"), an international gold explorer and producer, announces that the Corporation is proceeding with the previously announced financing agreement with Global Resources Investment Trust PLC ("GRIT") for C$5.0 million under the same terms and conditions as announced on November 12, 2013. Alhambra will receive 2,764,500 GRIT shares at a deemed value of one British pound (£1.00) per GRIT share. The C$5.0 million convertible note financing will provide the Corporation with the working capital it requires to resume its mining operations in Kazakhstan and to reorganize its outstanding debts.

GRIT is a UK based investment trust established to seek to exploit investment opportunities in the junior mining and natural resource sectors. GRIT's investment objective is to generate medium and long term capital growth through investments in diverse portfolios of primarily small and mid-capitalized natural resources and mining companies that are listed on various global stock exchanges.

GRIT is seeking admission of its ordinary shares on the main market for listed securities on the London Stock Exchange ("LSE"). It is anticipated that this transaction will be completed imminently.

Alhambra and GRIT have entered into a convertible secured promissory note agreement, whereby Alhambra would, assuming successful listing of the GRIT shares on the LSE, subscribe for GRIT shares at a deemed value of one British pound (£1.00) per GRIT share. Alhambra will then sell the GRIT shares through the facilities of the LSE to realize the private placement proceeds.

In exchange for the issuance of the GRIT shares, the Corporation will issue to GRIT, a C$5.0 million convertible secured promissory note (the "Note") and warrants. The Note will bear interest at an annual rate of 12%, will have a term of three years and will be secured by the Corporation's work in progress gold in Kazakhstan if and when required by GRIT. GRIT has the option to convert both the principal and interest portions of the Note into common shares of the Corporation at C$0.25 per common share. Alhambra has the option to pay the interest either in cash or in shares of the Corporation. The Note may be repaid at any time prior to maturity at the fair market value of the note at that time. The Corporation also has the option to force conversion during the term of the Note at a minimum of US$0.20 per share. In connection with the Note, Alhambra will issue warrants to purchase 5.0 million common shares of the Corporation (the "Warrants"). The Warrants have an exercise price of C$0.30 per common share and are exercisable for three years from the date of issue of the Note. If, at any time during the term of the Note, the weighted average trading price of Alhambra's shares for any five trading days within a period of ten consecutive trading days, equals or exceeds C$0.35 per share, any outstanding balance owing on the Note at that time will automatically convert to common shares of the Corporation. Similarly the Warrant holder is required to convert any outstanding Warrants at the same time and under the same conditions and to the extent any then outstanding Warrants not be converted, the outstanding Warrants will expire.

Completion of the financing is subject to receiving final approvals from the TSX Venture Exchange Inc. and the relevant Canadian Securities Commissions, and GRIT successfully listing its shares for trading on the LSE.

John J. Komarnicki, Chairman and Chief Executive Officer of the Corporation, stated, "We are delighted that our financing is close to being completed. The funds to be received will strengthen our balance sheet, allow us to deal with our creditors and advance our exploration and production development strategy."

In addition, on behalf of the Board of Directors of Alhambra, Mr. Komarnicki announces that effective immediately, Messrs John I. Huhs and Robin M. Merrifield have resigned for personal reasons as Directors of the Corporation.

"We would like to thank both John and Robin for their contributions to Alhambra and we wish them well," stated Mr. Komarnicki.

ABOUT ALHAMBRA

Alhambra is a Canadian based international exploration and gold production corporation producing gold in Kazakhstan.

Alhambra common shares trade in Canada on The TSX Venture Exchange under the symbol ALH, in the United States on the Over-The-Counter Pink Sheets Market under the symbol AHBRF and in Germany on the Frankfurt Open Market under the symbol A4Y. The Corporation's website can be accessed at www.alhambraresources.com.

Neither the TSX Venture Exchange Inc. nor its Regulation Services Provider (as that term is defined in the Policies of the TSX Venture Exchange Inc.) accepts responsibility for the adequacy or accuracy of this release.

Forward-Looking Statements

Certain statements contained in this news release constitute "forward-looking statements" as such term is used in applicable Canadian and US securities laws. These statements relate to analyses and other information that are based on forecasts of future results, estimates of amounts not yet determinable and assumptions of management. In particular, finalizing the financings detailed herein, and other factors and events described in this news release should be viewed as forward-looking statements to the extent that they involve estimates thereof. Any statements that express or involve discussions with respect to predictions, expectations, beliefs, plans, projections, objectives, assumptions or future events or performance (often, but not always, using words or phrases such as "expects" or "does not expect", "is expected", "anticipates" or "does not anticipate", "plans, "estimates" or "intends", or stating that certain actions, events or results "may", "could", "would", "might" or "will" be taken, occur or be achieved) are not statements of historical fact and should be viewed as "forward-looking statements". Such forward looking statements involve known and unknown risks including, finalizing the financings detailed herein; political, social and other risks inherent in carrying on business in a foreign jurisdiction and such other business risks as discussed herein and other publicly filed disclosure documents. Although the Corporation has attempted to identify important factors that could cause actual actions, events or results to differ materially from those described in forward-looking statements, there may be other factors that cause actions, events or results not to be as anticipated, estimated or intended. There can be no assurance that such statements will prove to be accurate as actual results and future events could vary or differ materially from those anticipated in such statements. Accordingly, readers should not place undue reliance on forward-looking statements contained in this news release.

Forward looking statements are made based on management's beliefs, estimates and opinions on the date the statements are made and the Corporation undertakes no obligation to update forward-looking statements and if these beliefs, estimates and opinions or other circumstances should change, except as required by applicable law.