Business Context and Reporting Period
Company: Alamos Gold Inc.
Filing Type: Form 6-K/A (Material Change Report)
Date: July 19, 2004
Context: Alamos Gold is a development-stage mining company constructing an open-pit, heap leach gold mine at its 100% owned Mulatos deposit in Sonora, Mexico. The deposit contains over 3 million ounces of gold in the measured and indicated category. Phase I mining focuses on the Estrella pit, containing over 1.4 million ounces of recoverable gold.
Key Financial Metrics
The filing does not provide revenue, profit, cash flow, or margin data as the company is in the development stage. The primary financial metric disclosed is the new debt facility:
- Total Financing: Up to US$45 million in term debt.
- Gold Loan: US$40 million due December 2009.
- Standby Loan: US$5 million for cost overruns.
- Gold Loan Interest Rate: 375 basis points above the gold lease rate prior to economic completion; 325 basis points thereafter.
- Standby Loan Interest Rate: 350 basis points above LIBOR.
Material Changes
On July 19, 2004, Alamos Gold signed a letter agreement with a banking syndicate (Société Générale, Standard Bank London Limited, and Macquarie Bank Limited) to secure financing for the Mulatos Project. This represents a significant capital event to fund project construction.
Guidance, Outlook, and Conditions
Conditions Precedent: The agreement is subject to satisfactory due diligence by a technical agent of the syndicate and the execution of definitive loan documentation.
Closing Date: Expected on or about September 30, 2004.
Collateral/Covenants: As a condition of the loan, Alamos must establish a fixed-price selling arrangement covering 250,000 ounces of gold production for the term of the loan.
Investor Verification Checklist
- Confirm the execution of definitive loan documentation and satisfaction of due diligence conditions.
- Verify the closing of the US$45 million facility by the expected date of September 30, 2004.
- Monitor the terms of the fixed-price selling arrangement for 250,000 ounces of gold.
- Track progress on the Estrella pit construction to ensure alignment with the loan's economic completion milestones.