Alamos Gold Inc (AGI)

[amarksp]

Alamos Financing Comments

Appears what AGI has done is finance Mulatos mine 100% with this $45M convertible debt. Reviewing RBC analyst report I see $41.5M debt at year end 2005 on their 11/29/04 report and McFarlane had a $45M LT Debt requirement listed on their report dated 10/4/04.

So bottom line, this convertible debt appears to be the previously announced debt needed to finance Mulatos, and NOT new debt.

Now one could argue that straight debt would have been preferable to convertible debt, but that 5.5% interest rate would have likely been over 10% and would have likely required more hedging to obtain straight debt... So net/net this financing appears to be more of a positive fundamentally than a negative.

Now how the market interprets this financing is another matter...