Replies to post #45 on Alamos Gold Inc (AGI)

[marcos]

There are debentures for cdn7.5m to pdg/Kennecott, due in 2010 or when the nine-month trailing average of the PoG exceeds 325, whichever comes first ..... this is from memory, but it's all in the amalgamation book ... i don't know where the 9-mo trailing average is at the moment, we should keep an eye on it ... for sure this facet of the risk has effected the shareprices over the last few months, compounded as it was by the delay of the merger .... with the newco a reality, i don't think it's a problem - Chester Millar has friends in the business ... Tice is one whose name has come up, there are others, more than a few, and they hit heavy enough to finance five millions usd on a property of over three millions ounces, i should think .... mine capex even for just Estrella is much more than this

The fairness opinion assumes that final property payment to be paid 'in year four', btw ... we shall see

Also from memory [of an estimation] - there is around cdn1.5m in cash between the two companies now, i think ... but, better check that, and it doesn't appear in the amalco book because that only goes up to last September, if i recall correctly .... aas had a placement since then [for cdn2.0m?], then paid a property payment for both companies ... so, might be less than cdn1.0m in the kitty, in any case it's not much .... there will be a promo and financing cycle coming up following the merger, no doubt

Next week is the meeting, on friday ... so, any iffiness in re the merger will be gone the monday after next .... and good riddance, too ..... cheers

[marcos]

' Alamos, National Gold arrange premerger financing

National Gold Corp NGT
Shares issued 30,728,990
Jan 22 2003 close $ 0.38
Thursday January 23 2003
News Release
See Alamos Minerals Ltd (C-AAS) News Release
Mr. Chester Millar reports
ALAMOS MINERALS LTD. AND NATIONAL GOLD CORPORATION ARRANGE DE ...

Alamos Minerals and National Gold, in advance of an extraordinary general meeting seeking shareholder approval to amalgamate the two companies, have arranged financing with H. Morgan & Company to prepay the outstanding debentures issued by National and held by Tenedoramex, S.A. de C.V. and Kennecott Minerals Company in connection with the purchase of the Salamandra gold property. Prior to completion of their merger, Alamos is the entity obtaining the loan and National, as registered holder of the claims, is the guarantor of the loan.

Under the terms of the December, 2000, asset purchase agreement, Alamos and National owe the vendors of Salamandra $7.5-million of the original $10.5-million purchase price. Payment of the $7.5-million outstanding can be rendered due 60 days after Oct. 31, 2004, if the nine-month trailing average price of gold exceeds $325 per ounce. Prepaying the outstanding amount prior to Jan. 31, 2003, reduces the amount due to $5.6-million, a reduction of $1.9-million.

The loan agreement allows Alamos to borrow up to $4-million (U.S.) (approximately $6-million (Canadian)) with a term of 61 months to the maturity date. The loan can be repaid in full any time after 24 months, and up to 50 per cent of the total amount can be paid at any time upon 30 days written notice. The rate of interest on the loan is 12 per cent per year compounded monthly, not in advance. Repayment terms require the company to pay the interest only, monthly in arrears on the outstanding balance; the principal is due in full on the maturity date. The loan is subject to regulatory approval.

The Salamandra property has seen $30-million (U.S.) in development and was the subject of a feasibility study to mine 2.2 million ounces of gold in the Mulatos deposit. At the time the study was completed the project economics were marginal with gold at less than $300 per ounce. A scoping study completed by Pincock, Allen and Holt (PAH) in September, 2002, focused on a higher grade portion of the deposit know as the Estrella zone containing 1.8 million ounces of gold. PAH concluded that with a gold price of $300 per ounce the Estrella zone could be mined profitably and generate an internal rate of return of 19.3 per cent.

The project is currently the subject of an engineering evaluation to determine the effect of higher gold prices on future development plans.

(c) Copyright 2003 Canjex Publishing Ltd. http://www.stockwatch.com '