Agnico-Eagle announces full redemption for common shares of 4.5% convertible debentures due 2012

(All amounts expressed in U.S. dollars unless otherwise noted)



TORONTO, Dec. 20  /PRNewswire-FirstCall/ -- Agnico-Eagle Mines Limited ("Agnico-Eagle") announced today that it has issued a notice to redeem all of its issued and outstanding $144 million principal amount 4.50% convertible subordinated debentures due February 15, 2012 (the "Debentures") and will discharge all of its obligations under the indenture governing the Debentures. The redemption date is set for February 15, 2006. While interest on the Debentures will cease to accrue on and after the redemption date, a full semi-annual payment of interest will be made on February 15, 2006 for holders of record as at January 31, 2006 (the "Record Date").

"The redemption of these debentures will leave Agnico-Eagle essentially debt-free and will be accretive to our common shareholders", said Sean Boyd, Vice Chairman and Chief Executive Officer. "With over $120 million in cash and a substantially undrawn credit line of $150 million, the Company is well positioned to advance its pipeline of projects towards achieving its goal of tripling gold production and doubling its gold reserves by 2009", added Mr. Boyd.

In accordance with the indenture governing the Debentures, Agnico-Eagle has elected to satisfy its obligation to pay the entire redemption price by the delivery of common shares of Agnico-Eagle ("Common Shares"). Fractional interests in Common Shares will be paid in cash.

The redemption price for the Debentures will be approximately $1,022.68 per $1,000 principal amount of Debentures redeemed. The redemption price will be satisfied by the delivery of approximately 63.4767 Common Shares for each $1,000 principal amount of Debentures redeemed. The number of Common Shares required to be delivered under the indenture is based on 95% of the volume weighted average trading price per Common Share on the New York Stock Exchange for the 20 consecutive trading days ending on the fifth day preceding December 20, 2005, the date of the notice of redemption. A notice of redemption may be obtained from Computershare Trust Company of Canada by contacting Patrick Griffin at [phone].

Holders of the Debentures have the right to convert their Debentures at any time before the close of business on February 14, 2006 at a conversion rate of 71.429 shares per $1,000 principal amount of Debentures, or $14 per share, in accordance with the indenture. Although the Company is not obligated to do so, accrued and unpaid interest will be paid on February 15, 2006 on Debentures converted after the Record Date.

Forward Looking Statements

The information in this press release has been prepared as at December 20, 2005. Certain statements contained in this press release constitute "forward-looking statements" within the meaning of the United States Private Securities Litigation Reform Act of 1995. When used in this document, the words "anticipate", "expect", "estimate," "forecast," "planned" and similar expressions are intended to identify forward-looking statements. Such statements reflect the Company's views at the time with respect to future events and are subject to certain risks, uncertainties and assumptions. Many factors could cause the actual results to be materially different from those expressed or implied by such forward-looking statements, including, among others, those which are discussed under the heading "Risk Factors" in the Company's most recently filed Annual Information Form and Annual Report on Form 20-F. The Company does not intend, and does not assume any obligation, to update these forward-looking statements.

About Agnico-Eagle

Agnico-Eagle is a long established Canadian gold producer with operations located in Quebec and exploration and development activities in Canada, Finland, the United States and Mexico. Agnico-Eagle's LaRonde Mine is Canada's largest gold deposit. The Company has full exposure to higher gold prices consistent with its policy of no forward gold sales. It has paid a cash dividend for 26 consecutive years. 

DATASOURCE: Agnico-Eagle Mines Limited



CONTACT: David Smith, Director, Investor Relations, [phone]

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