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SECURITIES AND EXCHANGE COMMISSION
Washington D. C. 20549
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FORM 8-K
PURSUANT TO SECTION 13 OR 15(D) OF THE
SECURITIES EXCHANGE ACT OF 1934
Date of Report
(Date of earliest event reported): May 18, 1999
Hecla Mining Company
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(Exact name of registrant as specified in its charter)
Delaware
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(State or other jurisdiction of incorporation)
1-8491 82-0126240
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(Commission File Number) (IRS Employer Identification No.)
6500 Mineral Drive
Coeur d'Alene, Idaho 83815-8788
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(Address of principal executive offices) (Zip Code)
(208) 769-4100
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(Registrant's Telephone Number)
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Item 7. FINANCIAL STATEMENTS, PRO FORMA FINANCIAL INFORMATION AND EXHIBITS.
Exhibit 99 - Press Release dated May 18, 1999
SIGNATURE
Pursuant to the requirements of Section 12 of the Securities Exchange Act
of 1934, the Registrant has duly caused this report to be signed on its behalf
by the undersigned, thereunto duly authorized.
HECLA MINING COMPANY
By /s/ Michael B. White
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Name: Michael B. White
Title: Vice President -
General Counsel
Dated: May 18, 1999
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EXHIBIT INDEX
EXHIBIT NO. TITLE
99 - Press Release dated May 18, 1999
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(Hecla Mining Company Logo)
EXHIBIT 99
99-11
FOR IMMEDIATE RELEASE
May 18, 1999
HECLA AGREES TO ACQUIRE THE ASSETS OF MONARCH RESOURCES LIMITED
COEUR D'ALENE, IDAHO - Hecla Mining Company (HL & HL-
PrB:NYSE) of Coeur d'Alene and Monarch Resources Limited
(MRE:TSE) of Bermuda today announced that Hecla has agreed to
purchase substantially all the assets of Monarch, subject to
financing arrangements and regulatory and Monarch shareholder
approval. The definitive purchase agreement, signed yesterday,
provides for Hecla to purchase the assets from Monarch for
$25 million, comprised of $9 million in cash and $16 million in
Hecla common shares. In addition, Monarch will retain a sliding
scale net smelter royalty on future production from the purchased
assets in excess of current resources at the La Camorra gold mine
and any future production in Mexico. Hecla and Monarch will also
share equally in a tax refund from the Venezuelan government
which could, if collected in full, net an additional
$1.7 million.
The primary asset included in the purchase is the La Camorra
gold mine and surrounding exploration concessions in Venezuela.
La Camorra is a high-grade, underground gold mine that produced
51,000 ounces of gold in 1998 at a grade of 0.44 ounce per ton.
Production is scheduled to ramp up to 80,000 ounces annually by
the year 2001. By then, Hecla expects to produce gold at a total
cash cost below $200 per ounce through operating and mine plan
improvements. The property is located 300 kilometers southeast
of Puerto Ordaz in the El Dorado District in Bolivar State. The
La Camorra operation exploits two shear zone-hosted quartz veins
that currently contain more than 600,000 ounces of high-grade
resource, including Hecla's estimate of 310,000 ounces of proven
and probable reserves. At planned production rates, mining is
expected to continue for at least the next six years. Based on
deep drilling intercepts, management believes that mine life can
be extended. The geologic structure of the mine appears similar
to other high-grade, low-cost underground mines operated by
Hecla.
Through the purchase agreement, Hecla will also acquire
Monarch's Mexican interests, including the Saladillo property and
other exploration prospects. The Saladillo property is located
110 kilometers northeast of Durango and is a highly prospective
epithermal, bonanza gold and silver project. The Francine vein
contains a drill-indicated resource of approximately 75,000
ounces gold and 8,000,000 ounces silver at a grade of 0.13 ounce
per ton gold and 14.6 ounces per ton silver.
Hecla intends to finance the cash portion of the purchase
through a combination of project-related debt and other financing
sources. Hecla is in the process of arranging the necessary
financing and has 75 days to close the transaction.
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Hecla Mining Company, headquartered in Coeur d'Alene, Idaho,
is one of the United States' best-known silver producers. The
company also produces gold and is a major supplier of ball clay,
kaolin and other industrial minerals. Hecla's operations are
principally in the U.S. and Mexico.
Statements made which are not historical facts, such as
anticipated production, exploration results, costs or sales
performance are "forward-looking statements" within the meaning
of the Private Securities Litigation Reform Act of 1995, and
involve a number of risks and uncertainties that could cause
actual results to differ materially from those projected,
anticipated, expected or implied. These risks and uncertainties
include, but are not limited to, metals prices volatility,
volatility of metals production, exploration project
uncertainties, industrial minerals market conditions and project
development risks. Refer to the company's Form 10-Q and 10-K
reports for a more detailed discussion of factors that may impact
expected future results. Hecla undertakes no obligation to
publicly update or revise any forward-looking statements.
Hecla contact: W. Bill Booth, vice president - investor and
public affairs - 208-769-4126
Monarch contact: Lester Knight, vice president - finance - 609-
716-4924
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Hecla's Home Page can be accessed on the Internet at:
http://www.hecla-mining.com
