SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Form 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported) May 28, 1997
Commerce Group Corp.
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(Exact name of registrant as specified in its charter)
Delaware 1-7375 39-605862
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(State or other (Commission File Number) (IRS Employer
jurisdiction of Identification
incorporation) No.)
6001 North 91st Street, Milwaukee, Wisconsin 53225-1795
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(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (414) 462-5310
fax: (414) 462-5312
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Item 5. Other Events Material Disclosure
On May 22, 1997, Commerce Group Corp. entered into an agreement with Teck
Corporation for the expansion of Commerce's mining operation at the San
Sebastian Gold Mine in El Salvador, Central America.
Under the terms of its agreement with Commerce, Teck will immediately
begin drilling, sampling, and performing metallurgical and mineralogical
studies to determine whether it will commit $10 million in funds for an
extensive exploration and feasibility study directed toward the
development of high volume gold production at the site of the San
Sebastian Gold Mine. If Teck commits $10 million to the project, Commerce
will have the option of either having Teck provide all of the resources
necessary to develop a high volume operation at the site of San Sebastian
Gold Mine in exchange for 50% of the earnings or entering into a
specified joint venture arrangement with Teck. Under the specified joint
venture option, Teck will pay to Commerce up to an initial $30 million
for half of the first 3 million ounces of gold to be produced, and
Commerce will then share on a 50/50 basis the capital expense and
earnings associated with the development. In either case, Teck will have
an option to purchase an additional 10% interest in the venture by paying
an additional $10 million to Commerce upon completion of its feasibility
studies.
Teck Corporation, based in Vancouver, Canada, is a major mining company
with world-wide mining interests in gold, silver, copper, zinc, niobium
and metallurgical coal. In 1996 Teck produced 360,000 ounces of gold and
reported net earnings of $255 million on revenue of $702 million.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
COMMERCE GROUP CORP.
(Registrant)
Date: May 28, 1997 /s/Edward L. Machulak
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By: Edward L. Machulak, President
