UNITED STATES
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): June 13, 1996
HOMESTAKE MINING COMPANY
(Exact name of Registrant as specified in its charter)
Delaware 1-8736 94-2934609
(State or other (Commission (I.R.S. Employer
jurisdiction of File Number) Identification Number)
incorporation)
650 California Street, San Francisco, California 94108-2788
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (415) 981-8150
Page 1 of 4 Pages
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Item 5. Other Events.
Homestake Gold of Australia Limited ("HGAL," now wholly owned by
Registrant) and Gold Mines of Kalgoorlie Limited ("GMK") each own a 50% interest
in the Kalgoorlie gold operations in Western Australia. Under applicable
agreements, GMK was entitled to more than 50% of the gold production from the
first 32.5 million metric tonnes of ore sourced from a specific area of the
Kalgoorlie operations. The entitlement in excess of 50%, called the
"disproportionate share," was calculated under a formula linked to gold prices,
production costs and capital costs.
As reported in Registrant's Form 10-K Report for the year ended
December 31, 1995, HGAL and GMK disagreed in respect of the interpretation and
application of the formula for calculating the disproportionate share. Also as
reported by Registrant, on October 20, 1995, HGAL had been served with a writ of
summons and statement of claim by GMK, North Kalgurli Mines Ltd, et al v.
Homestake Gold of Australia Limited, et al, Supreme Court of Western Australia,
Civ. No. 2037 of 1995. In the action, GMK claimed damages in respect of alleged
past calculation and underpayment of the disproportionate share and sought a
number of declarations relating to the interpretation and application of the
formula in the future.
On June 13, 1996 Registrant announced that HGAL and GMK had agreed
that HGAL would purchase all of GMK's past and future rights and entitlements
under the disproportionate sharing agreement for $51.4 million (A$65 million).
As a result, the parties will in the future share equally in gold production
from the Kalgoorlie operations. In addition, the above referenced litigation
will be dismissed.
Item 7. Financial Statements and Exhibits.
(c) Exhibits.
Exhibit 99.9 Press Release dated June 13, 1996 announcing that Homestake
Gold of Australia Limited ("HGAL") and Gold Mines of
Kalgoorlie Limited ("GMK") had agreed that HGAL would
purchase all of GMK's past and future rights and
entitlements under the disproportionate sharing arrangement
for $51.4 million (A$65 million). In addition, GMK will
discontinue litigation commenced against HGAL over past
differences in interpretations of the formula used to
calculate the disproportionate share.
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SIGNATURE
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 thereunto duly authorized.
Dated: June 13, 1996
HOMESTAKE MINING COMPANY
(Registrant)
By /s/Gene G. Elam
-------------------
Gene G. Elam
Vice President, Finance and
Chief Financial Officer
Page 3 of 4 Pages
Exhibit 99.9
NEWS RELEASE
Homestake Mining Company
650 California Street
San Francisco, CA 94108
Phone: 415/981-8150
Fax: 415/397-5038
Contact:
Michael A. Steeves
Director, Investor Relations
415-983-8169
Homestake Mining Company and Gold Mines of Kalgoorlie
Limited Settle Disproportionate Share Arrangement Dispute
San Francisco,CA, June 13, 1996-Homestake Mining Company (NYSE:HM), announced
today that Gold Mines of Kalgoorlie Limited (GMK) has accepted an offer of $51.4
million (A$65 million) from Homestake Gold of Australia Limited (HGAL) to
purchase all of GMK's past and future rights and entitlements under the
Disproportionate Sharing Arrangement (DSA).
The net effect is that from June 19, 1996, each party will share gold
production equally from the Super Pit operation in Kalgoorlie. Previously, under
certain circumstances, GMK was entitled to receive greater than 50 percent of
gold production sourced from the first 32.5 million tonnes of ore mined from a
specific area of the operation - an entitlement known as the DSA.
Under the agreement, GMK will discontinue litigation commenced against HGAL
over past differences in interpretations of the formula used to calculate the
DSA entitlement.
GMK and HGAL also have agreed to settle all other matters in dispute and to
work more closely with Kalgoorlie Consolidated Gold Mines Pty Ltd, manager of
the Kalgoorlie operations, to maximize the future potential of Australia's
largest gold mine.
Homestake Mining Company is an international gold mining company with
substantial gold mining operations and exploration primarily in the United
States, Canada and Australia. The Company expects to produce 1.8 million ounces
of gold in 1996.
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