Filed Pursuant to Rule 424(b)(5)
Registration Statement File No. 333-229803
Prospectus Supplement
(To Prospectus dated February 22, 2019)
Hecla Mining Company
Common Stock
Having an Aggregate
Offering Price of
up to $50,021,000
This prospectus supplement and the accompanying base prospectus relate to the issuance and sale from time to time of shares of common stock of Hecla Mining Company
having an aggregate offering price of up to $50,021,000 through our sales agent. These sales, if any, will be made pursuant to the terms of the equity distribution agreement dated February 23, 2016, as amended, between us and BMO Capital
Markets Corp. (“BMO”), who we refer to as the “sales agent,” which has been previously filed as an exhibit to a Current Report on
Form 8-K
that we filed with the Securities and
Exchange Commission.
Under the terms of the equity distribution agreement, we also may sell shares of common stock to the sales agent as principal for its own
account at a price agreed upon at the time of the sale. If we sell common stock to the sales agent as principal, we will enter into a separate terms agreement with the sales agent and we will describe that agreement in a separate prospectus
supplement or pricing supplement.
We will pay the sales agent a commission equal to a percentage, not to exceed 2%, of the gross sales price per share of the shares
sold through it as sales agent under the equity distribution agreement. Subject to the terms and conditions of the equity distribution agreement, BMO will use its commercially reasonable efforts to sell on our behalf any shares to be offered by us
under the equity distribution agreement. The offering of our common stock pursuant to the equity distribution agreement will terminate upon the earlier of (1) the sale of all shares of our common stock subject to the equity distribution
agreement or (2) the termination of the equity distribution agreement by us or by the sales agent. There is no minimum purchase requirement, and no arrangement for shares to be received in an escrow, trust or similar arrangement.
Our common stock is listed on the New York Stock Exchange (“NYSE”) under the symbol “HL.” On February 21, 2019, the last reported sale price of our
common stock on the NYSE was $2.74 per share. Sales of common stock under this prospectus supplement, if any, will be made by means of ordinary brokers’ transactions through the facilities of the NYSE at market prices, in block transactions, or
as otherwise agreed between us and the sales agent.
Investing in our common stock involves risks. See “
Risk Factors” on
page S-2
of this
prospectus supplement, page 6 of the accompanying prospectus and in the documents incorporated by reference in this prospectus supplement.
Neither the Securities and Exchange Commission nor any
state securities commission has approved or disapproved of these securities or determined if this prospectus supplement is truthful or complete. Any representation to the contrary is a criminal offense.
BMO CAPITAL MARKETS
This prospectus supplement is dated
February 22, 2019.
This document is in two parts. The first part is the prospectus supplement, which provides a brief description of our
business and the specific terms of this offering. The second part, the accompanying prospectus, gives more general information, some of which may not apply to this offering. You should read both this prospectus supplement and the accompanying
prospectus together with the additional information described under the heading “Where You Can Find More Information.” If the description of this offering varies between this prospectus supplement and the accompanying prospectus, you
should rely on the information in this prospectus supplement. You should rely only on the information incorporated by reference or provided in this prospectus supplement and the accompanying prospectus. We have not authorized anyone to provide
you with different information. You should not assume that the information provided in this prospectus supplement, the documents incorporated by reference or any other offering material is accurate as of any date other than the date on the front of
those documents, as applicable. Our business, financial condition, results of operations and prospects may have changed since those dates.
We are not, and
the sales agent is not, making an offer of these securities in any jurisdiction where the offer is not permitted, including in Canada.
TABLE OF CONTENTS
PROSPECTUS SUPPLEMENT
i
TABLE OF CONTENTS
PROSPECTUS
INFORMATION REGARDING FORWARD-LOOKING STATEMENTS
Certain
statements contained in this prospectus supplement, the accompanying prospectus and other public filings (including information incorporated by reference) are “forward-looking statements” and are intended to be covered by the safe harbor
provided for under Section 27A of the Securities Act of 1933 (“Securities Act”), as amended, and Section 21E of the Securities Exchange Act of 1934, as amended (“Exchange Act”). Our forward-looking statements include
our current expectations and projections about future production, results, performance, prospects and opportunities, including reserves, resources and other mineralization. We have tried to identify these forward-looking statements by using words
such as “may,” “might,” “will,” “expect,” “anticipate,” “believe,” “could,” “intend,” “plan,” “estimate” and similar expressions. These
forward-looking statements are based on information currently available to us and are expressed in good faith and believed to have a reasonable basis. However, our forward-looking statements are subject to a number of risks, uncertainties and other
factors that could cause our actual production, results, performance, prospects or opportunities, including reserves, resources and other mineralization, to differ materially from those expressed in, or implied by, these forward-looking statements.
These risks, uncertainties and other factors include, but are not limited to, those set forth under “Risk Factors” included in this prospectus supplement
and included under Item 1A of our Annual Report on Form
10-K
for the fiscal year ended December 31, 2018, which is incorporated by reference in this prospectus supplement, and any subsequent
Quarterly Reports on Form
10-Q,
each of which is also incorporated by reference in this prospectus supplement. Given these risks and uncertainties, readers are cautioned not to place undue reliance on our
forward-looking statements. Projections included or incorporated by reference in this prospectus supplement have been prepared based on assumptions, which we believe to be reasonable, but not in accordance with United States generally accepted
accounting principles (“GAAP”) or any guidelines of the Securities and Exchange Commission (“SEC”). Actual results will vary, perhaps materially, and we undertake no obligation to update the projections at any future date. You
are strongly cautioned not to place undue reliance on such projections. All subsequent written and oral forward-looking statements attributable to Hecla Mining Company or to persons acting on our behalf are expressly qualified in their entirety by
these cautionary statements. Except as required by federal securities laws, we do not intend to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.
ii
SUMMARY
The following summary is qualified in its entirety by reference to the more detailed information and consolidated financial statements appearing elsewhere or
incorporated by reference in this prospectus supplement and the accompanying prospectus, as well as the other materials filed with the SEC that are considered to be part of this prospectus supplement and the accompanying prospectus.
Unless otherwise stated or the context otherwise requires, references in this prospectus supplement to “Hecla,” “we,” “our,” “us”
or the “Company” refer to Hecla Mining Company and its subsidiaries.
Hecla Mining Company
Hecla Mining Company and our subsidiaries have provided precious and base metals to the U.S. economy and worldwide since 1891. We discover, acquire, develop, produce, and
market silver, gold, lead and zinc. In doing so, we intend to manage our business activities in a safe, environmentally responsible and cost-effective manner.
We
produce lead, zinc and bulk concentrates, which we sell to custom smelters and brokers, and unrefined precipitate and bullion bars (doré) containing gold and silver, which are further refined before sale to precious metals traders. We are
organized and managed into five segments that encompass our operating units: the Greens Creek unit, the Lucky Friday unit, the Casa Berardi unit, the San Sebastian unit, and the Nevada Operations unit.
On July 20, 2018, we acquired all of the issued and outstanding common shares of Klondex Mines Ltd. for approximately US$153 million and 75 million shares
of our common stock. Klondex is a primarily gold mining company with three producing mineral properties, all located in the State of Nevada.
Our principal executive
offices are located at 6500 N. Mineral Drive, Suite 200, Coeur d’Alene, Idaho 83815-9408. Our telephone number is
(208) 769-4100.
Our web site address is
www.hecla-mining.com
.
The Offering
|
Issuer
|
Hecla Mining Company, a Delaware corporation.
|
|
Securities Offered
|
Common stock, par value $0.25 per share, having an aggregate offering price of up to $50,021,000.
|
|
Manner of Offering
|
“At-the-market”
offering that may be made from time to time through our sales agent, BMO Capital Markets Corp. See “Plan of Distribution.”
|
|
Use of Proceeds
|
We intend to use the net proceeds from this offering, after deducting the sales agent’s commission and our offering expenses, for general corporate purposes.
|
|
Risk Factors
|
There are risks associated with this offering and our business. You should consider carefully the risk factors on
page S-2
of this prospectus supplement and the other risks identified in the documents
incorporated by reference herein before making a decision to purchase common stock in this offering.
|
|
Exchange Listing
|
Our common stock is listed for trading on the NYSE under the symbol “HL.”
|
S-1
RISK FACTORS
An investment in our common stock involves a significant degree of risk. You should carefully consider the risk factors described below, together with the other
information included or incorporated by reference in this prospectus supplement and the accompanying prospectus, including the risk factors included in our Annual Report on
Form 10-K
for the year ended
December 31, 2018 which are incorporated herein by reference, before you decide to purchase any of our common stock. The risks described below and incorporated herein by reference, any of which could materially and adversely affect our
business, financial condition, cash flows and results of operations, are the material risks of which we are currently aware; however, they may not be the only risks that we may face. Any of these risks could materially and adversely affect our
business, financial condition, results of operations and cash flows. In that case, you may lose all or part of your investment.
Our stockholders will
experience dilution as a result of this offering and they may experience further dilution if we issue additional common stock.
The issuance of our common
stock in this offering will have a dilutive effect on our earnings per share. Any additional future issuances of our common stock will reduce the percentage of our common stock owned by investors purchasing shares in this offering who do not
participate in those future issuances. Stockholders generally will not be entitled to vote on whether or not we issue additional common stock. In addition, depending on the terms and pricing of an additional offering of our common stock and the
value of our properties, our stockholders may experience dilution in both the book value and fair value of their shares.
USE OF PROCEEDS
We intend to use
the net proceeds from this offering, after deducting the sales agent’s commission and our offering expenses, for general corporate purposes.
MATERIAL UNITED STATES FEDERAL TAX CONSEQUENCES FOR
NON-U.S.
HOLDERS
The following discussion is a general summary
of the material United States federal income and estate tax consequences of the ownership and disposition of our common stock applicable to
“Non-U.S.
Holders.” As used in this prospectus supplement,
a
Non-U.S.
Holder means a beneficial owner of our common stock that is neither a U.S. person nor a partnership for U.S. federal income tax purposes, and that will hold shares of our common stock as capital
assets. For U.S. federal income tax purposes, a U.S. person is:
|
|
•
|
|
an individual who is a citizen or resident of the United States;
|
|
|
•
|
|
a corporation (or any other entity treated as a corporation for U.S. federal income tax purposes) created or organized in,
or under the laws of, the United States, any state thereof or the District of Columbia;
|
|
|
•
|
|
an estate the income of which is subject to U.S. federal income taxation regardless of its source; or
|
|
|
•
|
|
a trust that (a) is subject to the primary supervision of a court within the United States and one or more U.S. persons
has the authority to control all substantial decisions of the trust or (b) otherwise has validly elected to be treated as a U.S. domestic trust.
|
If a partnership (including an entity or arrangement treated as a partnership for U.S. federal income tax purposes) holds shares of our common stock, the U.S. federal
income tax treatment of the partnership and each partner generally will depend on the status of the partner and the activities of the partnership and the partner. Partnerships acquiring our common stock, and partners in such partnerships, are urged
to consult their own tax advisors with respect to the U.S. federal income tax consequences of the ownership and disposition of our common stock.
This summary does
not consider specific facts and circumstances that may be relevant to a particular
Non-U.S.
Holder’s tax position and does not consider U.S. state and local or
non-U.S.
tax consequences. It also does not consider
Non-U.S.
Holders subject to special tax treatment under the U.S. federal income tax laws (including
S-2
partnerships or other pass-through entities, banks and insurance companies, dealers in securities, holders of our common stock held as part of a “straddle,” “hedge,”
“conversion transaction” or other risk-reduction transaction, controlled foreign corporations, passive foreign investment companies, foreign
tax-exempt
organizations, former U.S. citizens or
residents, persons who hold or receive common stock as compensation and persons subject to the alternative minimum tax). This summary is based on provisions of the U.S. Internal Revenue Code of 1986, as amended (the “Code”), applicable
regulations promulgated by the U.S. Department of the Treasury (the “Treasury Regulations”), administrative pronouncements of the U.S. Internal Revenue Service (“IRS”) and judicial decisions, all as in effect on the date hereof,
and all of which are subject to change, possibly on a retroactive basis, and different interpretations.
This summary is included herein as general information
only. Accordingly, each prospective
Non-U.S.
Holder is urged to consult its own tax advisor with respect to the U.S. federal, state, local and
non-U.S.
income, estate
and other tax consequences of owning and disposing of our common stock.
Distributions
We occasionally pay distributions on our common stock, however there is no assurance that we will do so in the future. If we do make any distributions of cash or property
on our common stock, such distributions will constitute dividends for U.S. federal income tax purposes to the extent paid from our current or accumulated earnings and profits (as determined under U.S. federal income tax principles). If the amount of
a distribution exceeds our current and accumulated earnings and profits, such excess first will be treated as a
tax-free
return of capital to the extent of the
Non-U.S.
Holder’s adjusted tax basis in our common stock (with a corresponding reduction in such
Non-U.S.
Holder’s adjusted tax basis in our common stock), and thereafter will be treated as capital gain.
Subject to the withholding requirements under FATCA (as defined below), a
Non-U.S.
Holder generally will be subject to U.S. federal withholding tax at a 30% rate, or, if the
Non-U.S.
Holder is eligible, at a reduced rate prescribed by an applicable income tax treaty, on any distributions received in respect of our common stock. In order to obtain a reduced rate of U.S. federal
withholding tax under an applicable income tax treaty, a
Non-U.S.
Holder will be required to provide a properly executed IRS
Form W-8BEN
or IRS
Form W-8BEN-E,
as applicable (or the successor form to either) certifying under penalties of perjury its entitlement to benefits under the treaty. Special certification
requirements and other requirements apply to certain
Non-U.S.
Holders that are entities rather than individuals. A
Non-U.S.
Holder is urged to consult its own tax
advisor regarding its possible entitlement to benefits under an income tax treaty.
Dividends paid to a
Non-U.S.
Holder that
are effectively connected with a trade or business conducted by the
Non-U.S.
Holder in the United States (and, if required by an applicable income tax treaty, are treated as attributable to a permanent
establishment maintained by the
Non-U.S.
Holder in the United States) generally will be taxed on a net income basis at the rates and in the manner generally applicable to United States persons (as defined
under the Code). Effectively connected dividend income will not be subject to U.S. withholding tax if the
Non-U.S.
Holder satisfies certain certification requirements by providing to the withholding agent a
properly executed IRS
Form W-8ECI
(or successor form) properly certifying eligibility for the exemption. If such
Non-U.S.
Holder is a foreign corporation, it may
also be subject to a branch profits tax (at a 30% rate or such lower rate as specified by an applicable income tax treaty) on its effectively connected earnings and profits (as adjusted for certain items).
A
Non-U.S.
Holder of our common stock eligible for a reduced rate of U.S. withholding tax pursuant to an income tax treaty may
obtain a refund of any excess amounts withheld by timely filing an appropriate claim for refund with the IRS.
Dispositions of Our Common Stock
Subject to the withholding requirements under FATCA (as defined below), a
Non-U.S.
Holder generally will not be subject to U.S.
federal income tax in respect of any gain on a sale or other disposition of our common stock unless:
|
|
•
|
|
the gain is effectively connected with a U.S. trade or business conducted by such
Non-U.S.
Holder (and, if required by an applicable income tax treaty, the gain is attributable to a U.S. permanent establishment maintained by such
Non-U.S.
Holder);
|
|
|
•
|
|
the
Non-U.S.
Holder is an individual who is present in the United States for 183 or
more days in the taxable year of the disposition and meets other conditions; or
|
S-3
|
|
•
|
|
we are or have been a “U.S. real property holding corporation” (a “USRPHC”) under section 897 of
the Code at any time during the shorter of the five-year period ending on the date of disposition and the
Non-U.S.
Holder’s holding period for our common stock.
|
Unless an applicable income tax treaty provides otherwise, a
Non-U.S.
Holder whose gain is described in the first bullet point
immediately above will be subject to tax on the net gain derived from the sale under regular graduated U.S. federal income tax rates. If such
Non-U.S.
Holder is a foreign corporation, it may also be subject to
a branch profits tax (at a 30% rate or such lower rate as specified by an applicable income tax treaty) on its effectively connected earnings and profits (as adjusted for certain items).
An individual
Non-U.S.
Holder described in the second bullet point immediately above will be subject to a flat 30% tax (or lower
applicable treaty rate) on the gain derived from the sale, which may be offset by U.S. source capital losses of the
Non-U.S.
Holder, even though the individual is not considered a resident of the United
States.
With respect to the third bullet point above, in general, a corporation is a USRPHC if the fair market value of its “U.S. real property interests”
(as defined in the Code and applicable Treasury Regulations) equals or exceeds 50% of the sum of the fair market value of its worldwide real property interests (including its U.S. real property interests) and its other assets used or held for use in
its trade or business. We believe that we currently are, and expect to remain for the foreseeable future, a USRPHC for U.S. federal income tax purposes. However, as long as our common stock continues to be “regularly traded on an established
securities market,” a
Non-U.S.
Holder will be taxable on gain recognized on the disposition of our common stock as a result of our status as a USRPHC only if the
Non-U.S.
Holder actually or constructively owned more than 5% of such common stock at any time during the shorter of the five-year period ending on the date of the disposition or, if shorter, the
Non-U.S.
Holder’s holding period for the common stock. If our common stock were not considered to be regularly traded on an established securities market, all
Non-U.S.
Holders would be subject to U.S. federal income tax (and withholding in respect thereof) on a disposition of our common stock, and a 15% withholding tax would apply to the amount realized by the
Non-U.S.
Holder from any such disposition, even if such
Non-U.S.
Holder’s ultimate U.S. federal income tax liability were determined to be less than the amount withheld.
Non-U.S.
Holders are urged to consult their tax advisors with respect to the application of the foregoing rules to their
ownership and disposition of our common stock.
Federal Estate Tax
Any of
our common stock held by an individual
Non-U.S.
Holder at the time of death will be included in such holder’s gross estate for U.S. federal estate tax purposes, unless an applicable estate tax treaty
provides otherwise.
Information Reporting and Backup Withholding Requirements
Any distributions paid on our common stock, and the tax withheld with respect thereto, are subject to information reporting requirements. These information reporting
requirements apply regardless of whether withholding was reduced or eliminated by an applicable tax treaty or withholding was not required because the distributions were effectively connected with a trade or business in the United States conducted
by the
Non-U.S.
Holder. Copies of these information returns also may be made available under the provisions of a specific treaty or agreement to the tax authorities of the country in which the
Non-U.S.
Holder resides. Under certain circumstances, the Code imposes a backup withholding obligation (currently at a rate of 28%) on certain reportable payments. Distributions paid to a
Non-U.S.
Holder on our common stock generally will be exempt from backup withholding if the
Non-U.S.
Holder provides a properly executed IRS
Form W-8BEN
or IRS
Form W-8BEN-E,
as applicable (or a successor form for either) or otherwise establishes an exemption.
The payment of the proceeds from the disposition of our common stock to or through the U.S. office of any broker, U.S. or foreign, will be subject to information
reporting and possible backup withholding unless the holder certifies as to its
non-U.S.
status under penalties of perjury or otherwise establishes an exemption, provided that the broker does not have actual
knowledge or reason to know that the holder is a U.S. person or that the conditions of any
S-4
other exemption are not, in fact, satisfied. The payment of the proceeds from the disposition of our common stock to or through a
non-U.S.
office of a
non-U.S.
broker will not be subject to information reporting or backup withholding unless the
non-U.S.
broker has certain types of relationships with the United States (a
“U.S. related person”). In the case of the payment of the proceeds from the disposition of our common stock to or through a
non-U.S.
office of a broker that is either a U.S. person or a U.S. related
person, the Treasury Regulations require information reporting (but not backup withholding) on the payment unless the broker has documentary evidence in its files that the holder is a
Non-U.S.
Holder and the
broker has no knowledge to the contrary.
Non-U.S.
Holders are urged to consult their own tax advisors on the application of information reporting and backup withholding to them in their particular
circumstances (including upon their disposition of our common stock).
Backup withholding is not an additional tax. Any amounts withheld under the backup withholding
rules from a payment to a
Non-U.S.
Holder may be refunded or credited against the
Non-U.S.
Holder’s U.S. federal income tax liability, if any, if the
Non-U.S.
Holder provides the required information to the IRS on a timely basis.
Non-U.S.
Holders are urged to consult their own tax advisors regarding the filing of a U.S. tax
return for claiming a refund of such backup withholding.
Withholding under the Foreign Account Tax Compliance Act
Sections 1471 through 1474 of the Code, and the Treasury Regulations and administrative guidance promulgated thereunder (“FATCA”) impose U.S. withholding
on certain payments made to “foreign financial institutions” and to certain other
non-U.S.
entities, including intermediaries. Such withholding will generally be imposed at a 30% rate on certain
payments of dividends on shares issued by a U.S. person, including our common stock, to a foreign financial institution unless such foreign financial institution enters into (or is deemed to have entered into) an agreement with the U.S. Department
of the Treasury to, among other things, undertake to identify accounts held by certain U.S. persons or U.S.-owned foreign entities, annually report certain information about such accounts, and withhold 30% of payments to such account holders whose
actions prevent the financial institution from complying with these reporting and other requirements. Withholding is imposed on similar types of payments to a
non-financial
foreign entity unless the entity
certifies that it does not have any substantial U.S. owners or the entity furnishes identifying information regarding each substantial U.S. owner. Certain countries have entered into, and other countries are expected to enter into, agreements with
the United States to facilitate the type of information reporting required under FATCA, which will reduce but not eliminate the risk of FATCA withholding for investors in or holding our common stock through financial institutions in such countries.
FATCA withholding currently applies to payments of U.S.-source dividends and other fixed payments. Although the term “withholdable payment,” as defined in the Code, also includes the gross proceeds of a disposition of stock (including a
liquidating distribution from a corporation) or debt instruments, in each case with respect to any U.S. investment, recently issued proposed Treasury Regulations provide that such gross proceeds are not “withholdable payments” under FATCA.
Taxpayers generally may rely on these proposed Treasury Regulations until final Treasury Regulations are issued. Neither we nor any other person would be required to pay additional amounts as a result of FATCA withholding.
Non-U.S.
Holders are urged to consult their own tax advisors with respect to the U.S. federal income tax consequences of FATCA to their ownership and disposition of our common stock.
PLAN OF DISTRIBUTION
On
February 23, 2016, we entered into an equity distribution agreement with BMO Capital Markets Corp. as sales agent, under which we may offer and sell shares of common stock having an aggregate offering price of up to $75,000,000 from time to
time. The equity distribution agreement has been filed as an exhibit to the registration statement of which this prospectus supplement is a part. Under the terms of the equity distribution agreement, the sales of common stock made thereunder will be
made by means of ordinary brokers’ transactions on the NYSE at market prices, or as otherwise agreed upon by the sales agent and us. The sales agent will not engage in any transactions that stabilize the price of our common stock.
Between February 23, 2016 and the date of this prospectus supplement, we sold approximately 7.2 million shares of common stock for net proceeds to us of
approximately $23.83 million. Since the equity distribution agreement contemplates sales of up to $75 million worth of common stock, there remains $50,021,000 worth of our common stock eligible to be sold under the equity distribution
agreement.
S-5
Under the terms of the equity distribution agreement, we also may sell shares of common stock to the sales agent as
principal for its own account at a price agreed upon at the time of sale. If we sell common stock to the sales agent as principal, we will enter into a separate terms agreement with the sales agent and we will describe this terms agreement in a
separate prospectus supplement or pricing supplement.
We will designate the maximum amount of common stock to be sold through the sales agent on a daily basis or
otherwise as we and the sales agent agree and the minimum price per common share at which such common stock may be sold. Subject to the terms and conditions of the equity distribution agreement, the sales agent will use its reasonable efforts to
sell on our behalf all of the designated common stock. We may instruct the sales agent not to sell any common stock if the sales cannot be effected at or above the price designated by us in any such instruction. We or the sales agent may suspend the
offering of common stock at any time and from time to time by notifying the other party.
The sales agent will provide to us written confirmation following the close
of trading on the NYSE each day in which common stock is sold under the equity distribution agreement. Each confirmation will include the number of shares sold on that day, the gross sales proceeds and the net proceeds to us (after transaction fees,
if any, but before other expenses). We will report at least quarterly the number of shares of common stock sold through the sales agent under the equity distribution agreement, the net proceeds to us (before expenses) and the commissions of the
sales agent in connection with the sales of the common stock.
We will pay the sales agent a commission of up to 2% of the gross sales price per share of common
stock sold through it as our agent under the equity distribution agreement. We have agreed to reimburse the sales agent for certain of its expenses.
Settlement for
sales of common stock will occur on the third business day following the date on which any sales were made in return for payment of the net proceeds to us. There is no arrangement for funds to be received in an escrow, trust or similar arrangement.
Under the terms of the equity distribution agreement, if we or the sales agent have reason to believe that shares of our common stock are no longer
“actively-traded securities” as defined under Rule 101(c)(l) of Regulation M under the Exchange Act that party will promptly notify the other and sales of common stock pursuant to the equity distribution agreement or any terms
agreement will be suspended until in our collective judgment Rule 101(c)(1) or another exemptive provision has been satisfied.
The offering of common stock
pursuant to the equity distribution agreement will terminate upon the earlier of (1) the sale of all common stock subject to the equity distribution agreement or (2) the termination of the equity distribution agreement by us or by the
sales agent.
In connection with the sale of the common stock on our behalf, the sales agent may be deemed to be an “underwriter” within the meaning of the
Securities Act, and the compensation paid to the sales agent may be deemed to be underwriting commissions or discounts. We have agreed to provide indemnification and contribution to the sales agent against certain liabilities, including civil
liabilities under the Securities Act.
Conflicts of Interest
The sales
agent and/or affiliates of the sales agent have, from time to time, performed, and may in the future perform, various financial advisory and commercial and investment banking services for us and our affiliates, for which they have received and in
the future will receive customary compensation and expense reimbursement.
WHERE YOU CAN FIND MORE INFORMATION
We file annual, quarterly and current reports, proxy statements and other information with the SEC. Our SEC filings are available to the public from the SEC’s
web site at
http://www.sec.gov
or call the SEC at
800-SEC-0330. Information
about us, including our SEC filings, is also available through our web site at
http://www.hecla-mining.com
. However, information on our web site is not incorporated into this prospectus supplement, the accompanying prospectus or our other SEC filings and is not a part of this prospectus supplement, the accompanying
prospectus or those filings.
This prospectus supplement and the accompanying prospectus is part of a registration statement filed by us with the SEC. The
exhibits to our registration statement or to documents filed under the Exchange Act and incorporated
S-6
by reference herein contain the full text of certain contracts and other important documents we have summarized in this prospectus supplement or the accompanying prospectus. Since these
summaries may not contain all the information that you may find important in deciding whether to purchase the securities we may offer, you should review the full text of these documents. The registration statement and the exhibits can be
obtained from the SEC as indicated above, or from us.
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
The SEC allows us to “incorporate by reference” the information we file with the SEC. This means that we can disclose important information to you by
referring you to another filed document. Any information referred to in this way is considered part of this prospectus supplement from the date we file that document. Any reports filed by us with the SEC after the date of this prospectus
supplement and before the date that the offering of the securities by means of this prospectus supplement is terminated will automatically update and, where applicable, supersede any information contained in this prospectus supplement or
incorporated by reference in this prospectus supplement. Accordingly, we incorporate by reference the following documents or information filed with the SEC:
|
|
•
|
|
Annual Report on Form
10-K
for the year ended December 31, 2018, which we filed
with the SEC on February 22, 2019;
|
|
|
•
|
|
Current Reports on Form
8-K
filed on February 21, 2019 (Item 8.01 only) and
July 24, 2018 (Item 9.01 (a) and (d) Exhibits 99.2 and 99.3 only);
|
|
|
•
|
|
The description of our capital stock contained in our Form
8-B
filed with the SEC on
May 6, 1983;
|
|
|
•
|
|
The information responsive to Part III of Form
10-K
for the year ended
December 31, 2017, provided in our Definitive Proxy Statement on Schedule 14A filed with the SEC in on April 9, 2018; and
|
|
|
•
|
|
All documents filed by us in accordance with Sections 13(a), 13(c), 14 or 15(d) of the Exchange Act on or after the date of
this prospectus supplement and before the termination of the offering under this prospectus supplement, other than documents or information deemed furnished and not filed in accordance with SEC rules.
|
We will provide to each person, including any beneficial owner, to whom a copy of this prospectus supplement has been delivered, without charge, upon the written or oral
request of such person, a copy of any or all of the documents which are incorporated by reference into this prospectus supplement, other than exhibits to such documents, unless such exhibits are specifically incorporated by reference into the
information that this prospectus supplement incorporates. You should direct requests for such copies to:
Hecla Mining Company
6500 North Mineral Drive, Suite 200
Coeur d’Alene,
Idaho 83815
Attention: Investor Relations
Telephone (208)
769-4100
LEGAL MATTERS
The validity of the
shares of common stock has been passed upon for us by K&L Gates LLP. Hunton Andrews Kurth LLP will pass upon certain legal matters for the sales agent.
EXPERTS
The consolidated financial
statements as of December 31, 2018 and 2017 and for each of the three years in the period ended December 31, 2018 and management’s assessment of the effectiveness of internal control over financial reporting as of December 31,
2018 incorporated by reference in this Prospectus Supplement have been so incorporated in reliance on the reports of BDO USA, LLP, an independent registered public accounting firm, incorporated herein by reference, given on the authority of said
firm as experts in auditing and accounting.
The audited historical financial statements of Klondex Mines Ltd. as of and for the years ended December 31, 2017 and
2016, included in Hecla Mining Company’s Current Report on Form 8-K dated July 24, 2018 and incorporated by reference in this Prospectus Supplement have been so incorporated in reliance on the reports of PricewaterhouseCoopers LLP, independent
public accounting firm, given on the authority of said firm as experts in auditing and accounting.
S-7
PROSPECTUS
Hecla Mining Company
Common Stock
Preferred
Stock
Warrants
Debt Securities
We may offer
and sell from time to time, in one or more offerings, shares of our common stock, preferred stock, warrants, and debt securities.
This
prospectus describes some of the general terms that may apply to these securities. The specific terms of any securities to be offered will be described in a supplement to this prospectus. A prospectus supplement may also add, update or
change information contained in this prospectus. You should read this prospectus and the applicable prospectus supplement carefully before you make your investment decision.
This prospectus may not be used to sell securities unless accompanied by a prospectus supplement.
We may offer and sell these securities through one or more underwriters, dealers and agents, underwriting syndicates managed or
co-managed
by one or more underwriters, or directly to purchasers, on a continuous or delayed basis.
The prospectus supplement for each offering of securities will describe the plan of distribution for that offering. Our common stock is
listed on the New York Stock Exchange under the trading symbol “HL.” The prospectus supplement will indicate if the securities offered thereby will be listed on any securities exchange.
Investing in our common stock involves risks. See “
Risk Factors
” beginning on page 6 of this
prospectus and in the documents incorporated by reference in this prospectus.
Neither the Securities and Exchange Commission
(“SEC”) nor any state securities commission has approved or disapproved of these securities or determined if this prospectus or the accompanying prospectus supplement is truthful or complete. Any representation to the contrary is a
criminal offense.
You should rely only on the information contained or incorporated by reference in this prospectus. We have not
authorized anyone to provide you with information different from that contained or incorporated by reference in this prospectus. This prospectus does not constitute an offer to sell or a solicitation of an offer to buy securities other than those
specifically offered hereby or an offer to sell any securities offered hereby in any jurisdiction where, or to any person to whom, it is unlawful to make such offer or solicitation. You should not assume that the information provided in this
prospectus, any prospectus supplement, the documents incorporated by reference or any other offering material is accurate as of any date other than the date on the front of those documents, as applicable.
The date of this prospectus is February 22, 2019.
ABOUT THIS PROSPECTUS
This prospectus is part of a registration statement that we filed with the Securities and Exchange Commission, or SEC, utilizing a
“shelf” registration process. Under this shelf process, we may, from time to time, sell common stock, preferred stock, warrants, and debt securities as described in this prospectus, in one or more offerings.
This prospectus may not be used to sell securities unless accompanied by a prospectus supplement. This prospectus provides you with a
general description of the common stock and other securities that we may offer. Each time we sell common stock or other securities, we will provide a prospectus supplement that will contain specific information about the terms of that offering,
including the specific amounts, prices and terms of the common stock or other securities offered. The prospectus supplements may also add, update or change information contained in this prospectus. You should read both this prospectus and any
prospectus supplement together with the additional information described under the heading “Where You Can Find More Information” and “Incorporation of Certain Documents By Reference.”
This prospectus and any accompanying prospectus supplement do not contain all of the information included in the registration statement as
permitted by the rules and regulations of the SEC. For further information, we refer you to the registration statement on Form
S-3,
including its exhibits. We are subject to the informational requirements of
the Securities Exchange Act of 1934 and, therefore, file reports and other information with the SEC. Our file number with the SEC is
1-8491.
Statements contained in this prospectus and any accompanying
prospectus supplement or other offering material about the provisions or contents of any agreement or other document are only summaries. If SEC rules require that any agreement or document be filed as an exhibit to the registration statement, you
should refer to that agreement or document for its complete contents.
Unless otherwise stated or the context otherwise requires,
references in this prospectus to “Hecla,” “we,” “our,” “us” or the “Company” refer to Hecla Mining Company and its subsidiaries.
You should rely only on the information contained or incorporated by reference in this prospectus. We have not authorized anyone to provide
you with different information. If anyone provides you with different or inconsistent information, you should not rely on it. We are not making an offer to sell these securities in any jurisdiction where the offer or sale is not permitted.
You should not assume that the information provided in this prospectus, any prospectus supplement or any other offering material is accurate
as of any date other than the date on the front of those documents, as applicable. Our business, financial condition, results of operations and prospects may have changed since that date.
INFORMATION REGARDING FORWARD-LOOKING STATEMENTS
Certain statements contained in this prospectus and other public filings (including information incorporated by reference) are
“forward-looking statements” and are intended to be covered by the safe harbor provided for under Section 27A of the Securities Act of 1933, as amended (the “Securities Act”), and Section 21E of the Securities Exchange
Act of 1934, as amended (the “Exchange Act”). Our forward-looking statements include our current expectations and projections about future production, results, performance, prospects and opportunities, including reserves, resources and
other mineralization. We have tried to identify these forward-looking statements by using words such as “may,” “might,” “will,” “expect,” “anticipate,” “believe,” “could,”
“intend,” “plan,” “estimate” and similar expressions. These forward-looking statements are based on information currently available to us and are expressed in good faith and believed to have a reasonable basis. However,
our forward-looking statements are subject to a number of risks, uncertainties and other factors that could cause our actual production, results, performance, prospects or opportunities, including reserves, resources and other mineralization, to
differ materially from those expressed in, or implied by, these forward-looking statements.
1
These risks, uncertainties and other factors include, but are not limited to, those set
forth in our Annual Report on Form
10-K
for the year ended December 31, 2018, which is incorporated by reference in this prospectus, in any other SEC Reports we file and in this prospectus, including the
following:
|
|
•
|
|
a substantial or extended decline in metals prices would have a material adverse effect on us;
|
|
|
•
|
|
we have limited cash resources and are dependent on access to our revolving credit facility or alternative
financing to meet our working capital needs;
|
|
|
•
|
|
the acquisition of Klondex increased our exposure to gold price volatility;
|
|
|
•
|
|
we have had losses that could reoccur in the future;
|
|
|
•
|
|
an extended decline in metals prices, an increase in operating or capital costs, mine accidents or closures,
increasing environmental obligations, or our inability to convert exploration potential to reserves may cause us to record write-downs, which could negatively impact our results of operations;
|
|
|
•
|
|
global financial events or developments impacting major industrial or developing countries may have an impact on
our business and financial condition in ways that we currently cannot predict;
|
|
|
•
|
|
recently enacted tariffs, other potential changes to tariff and import/export regulations, and ongoing trade
disputes between the United States and other jurisdictions may have a negative effect on global economic conditions and our business, financial results and financial condition;
|
|
|
•
|
|
commodity and currency risk management activities could prevent us from realizing possible revenues or lower
costs, or expose us to losses;
|
|
|
•
|
|
our profitability could be affected by the prices of other commodities;
|
|
|
•
|
|
our accounting and other estimates may be imprecise;
|
|
|
•
|
|
our ability to recognize the benefits of deferred tax assets is dependent on future cash flows and taxable
income;
|
|
|
•
|
|
returns for investments in pension plans and pension plan funding requirements are uncertain;
|
|
|
•
|
|
mining accidents or other adverse events at an operation could decrease our anticipated production or otherwise
adversely affect our operations;
|
|
|
•
|
|
our operations may be adversely affected by risks and hazards associated with the mining industry that may not be
fully covered by insurance;
|
|
|
•
|
|
our costs of development of new orebodies and other capital costs may be higher and provide less return than we
estimated;
|
|
|
•
|
|
our ore reserve estimates may be imprecise;
|
|
|
•
|
|
efforts to expand the finite lives of our mines may not be successful or could result in significant demands on
our liquidity, which could hinder our growth;
|
|
|
•
|
|
our ability to market our metals production may be affected by disruptions or closures of smelters and/or
refining facilities;
|
|
|
•
|
|
our business depends on availability of skilled miners and good relations with employees;
|
|
|
•
|
|
shortages of critical parts and equipment may adversely affect our operations and development projects;
|
|
|
•
|
|
our information technology systems may be vulnerable to disruption which could place our systems at risk from
data loss, operational failure, or compromise of confidential information;
|
|
|
•
|
|
our foreign activities are subject to additional inherent risks;
|
|
|
•
|
|
our operations and properties in Canada expose us to additional political risks;
|
2
|
|
•
|
|
certain of our mines and exploration properties in Nevada are located on land that is or may become subject to
traditional territory, title claims and/or claims of cultural significance by certain Native American tribes, and such claims and the attendant obligations of the federal government to those tribal communities and stakeholders may affect our current
and future operations;
|
|
|
•
|
|
we may be subject to a number of unanticipated risks related to inadequate infrastructure;
|
|
|
•
|
|
competition from other mining companies may harm our business;
|
|
|
•
|
|
we face inherent risks in acquisitions of other mining companies or properties that may adversely impact our
growth strategy;
|
|
|
•
|
|
we may be unable to successfully integrate the operations of the properties we acquire, including our
recently-acquired Nevada operations;
|
|
|
•
|
|
we may not realize all of the anticipated benefits from our acquisitions, including our recent acquisition of
Klondex;
|
|
|
•
|
|
the properties we may acquire may not produce as expected, and we may be unable to determine reserve potential,
identify liabilities associated with the acquired properties or obtain protection from sellers against such liabilities;
|
|
|
•
|
|
our joint development and operating arrangements may not be successful;
|
|
|
•
|
|
we are currently involved in ongoing legal disputes that may materially adversely affect us;
|
|
|
•
|
|
we are required to obtain governmental permits and other approvals in order to conduct mining operations;
|
|
|
•
|
|
we face substantial governmental regulation, including the Mine Safety and Health Act, various environmental laws
and regulations and the 1872 Mining Law;
|
|
|
•
|
|
our operations are subject to complex, evolving and increasingly stringent environmental laws and regulations.
Compliance with environmental regulations, and litigation based on such regulations, involves significant costs and can threaten existing operations or constrain expansion opportunities;
|
|
|
•
|
|
state ballot initiatives could impact our operations;
|
|
|
•
|
|
legal challenges could prevent the Rock Creek or Montanore projects from ever being developed;
|
|
|
•
|
|
mine closure and reclamation regulations impose substantial costs on our operations and include requirements that
we provide financial assurance supporting those obligations. These costs could significantly increase;
|
|
|
•
|
|
our environmental obligations may exceed the provisions we have made;
|
|
|
•
|
|
we face risks relating to transporting our products, as well as transporting employees and materials at Greens
Creek;
|
|
|
•
|
|
the titles to some of our properties may be defective or challenged;
|
|
|
•
|
|
the price of our stock has a history of volatility and could decline in the future;
|
|
|
•
|
|
our Series B preferred stock has a liquidation preference of $50 per share or $7.9 million;
|
|
|
•
|
|
we may not be able to pay common or preferred stock dividends in the future;
|
|
|
•
|
|
our existing stockholders are effectively subordinated to the holders of our Senior Notes;
|
|
|
•
|
|
additional issuances of equity securities by us would dilute the ownership of our existing stockholders and could
reduce earnings per share;
|
|
|
•
|
|
the issuance of additional shares of our preferred or common stock in the future could adversely affect holders
of common stock;
|
3
|
|
•
|
|
if a large number of shares of our common stock are sold in the public market, the sales could reduce the trading
price of our common stock and impede our ability to raise future capital;
|
|
|
•
|
|
the provisions in our certificate of incorporation, our
by-laws
and
Delaware law could delay or deter tender offers or takeover attempts;
|
|
|
•
|
|
if we cannot meet the New York Stock Exchange continued listing requirements, the NYSE may delist our common
stock;
|
|
|
•
|
|
our level of debt could impair our financial health and prevent us from fulfilling our obligations under our
existing and future indebtedness;
|
|
|
•
|
|
any downgrade in the credit ratings assigned to us or our debt securities could increase future borrowing costs,
adversely affect the availability of new financing and may result in increased collateral requirements under our existing surety bond portfolio;
|
|
|
•
|
|
our Senior Notes and the guarantees thereof are effectively subordinated to any of our and our guarantors’
secured indebtedness to the extent of the value of the collateral securing that indebtedness;
|
|
|
•
|
|
we may be unable to generate sufficient cash to service all of our indebtedness and meet our other ongoing
liquidity needs and may be forced to take other actions to satisfy our obligations under our indebtedness, which may be unsuccessful;
|
|
|
•
|
|
the terms of our debt impose restrictions on our operations;
|
|
|
•
|
|
our Senior Notes are structurally subordinated to all liabilities of our
non-guarantor
subsidiaries;
|
|
|
•
|
|
our variable rate indebtedness subjects us to interest rate risk, which could cause our indebtedness service
obligations to increase significantly;
|
|
|
•
|
|
key terms of the Senior Notes will be suspended if the Senior Notes achieve investment grade ratings and no
default or event of default has occurred and is continuing;
|
|
|
•
|
|
we may be unable to repurchase Senior Notes in the event of a change of control as required by the indenture;
|
|
|
•
|
|
holders of the Senior Notes may not be able to determine when a change of control giving rise to their right to
have the Senior Notes repurchased has occurred following a sale of “substantially all” of our assets; and
|
|
|
•
|
|
federal and state fraudulent transfer laws may permit a court to void the Senior Notes or any of the guarantees
thereof, and if that occurs, holders of the Senior Notes may not receive any payments on the notes.
|
Given these risks
and uncertainties, readers are cautioned not to place undue reliance on our forward-looking statements. Projections and other forward-looking statements included in this prospectus have been prepared based on assumptions, which we believe to be
reasonable, but not in accordance with United States generally accepted accounting principles (“GAAP”) or any guidelines of the SEC. Actual results may vary, perhaps materially. You are strongly cautioned not to place undue reliance on
such projections and other forward-looking statements. All subsequent written and oral forward-looking statements attributable to Hecla Mining Company or to persons acting on our behalf are expressly qualified in their entirety by these
cautionary statements. Except as required by federal securities laws, we disclaim any intention or obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.
HECLA MINING COMPANY
Hecla Mining Company and our subsidiaries have provided precious and base metals to the U.S. economy and worldwide since 1891. We discover,
acquire, develop, produce, and market silver, gold, lead and zinc. In doing so, we intend to manage our business activities in a safe, environmentally responsible and cost-effective manner.
4
We produce lead, zinc and bulk concentrates, which we sell to custom smelters and brokers,
and unrefined precipitate and bullion bars (doré) containing gold and silver, which are further refined before sale to precious metals traders. We are organized and managed into five segments that encompass our operating units: the Greens
Creek unit, the Lucky Friday unit, the Casa Berardi unit, the San Sebastian unit, and the Nevada Operations unit.
On July 20, 2018,
we acquired all of the issued and outstanding common shares of Klondex Mines Ltd. for approximately US$153 million and 75 million shares of our common stock. Klondex is a primarily gold mining company with three producing mineral
properties, all located in the State of Nevada.
The map below shows the locations of our operating units and our exploration and
pre-development
projects, as well as our corporate offices located in Coeur d’Alene, Idaho and Vancouver, British Columbia.
Our principal executive offices are located at 6500 N. Mineral Drive, Suite 200, Coeur d’Alene, Idaho
83815-9408. Our telephone number is
(208) 769-4100.
Our web site address is
www.hecla-mining.com
.
5
RISK FACTORS
Investment in our securities involves risks. You should carefully consider the risk factors incorporated by reference to our most recent
Annual Report on Form
10-K
and any subsequent Quarterly Reports on Form
10-Q
or Current Reports on Form
8-K
we file after the
date of this prospectus, and all other information contained or incorporated by reference into this prospectus, as updated by our subsequent filings under the Exchange Act, as well as the risk factors and other information contained in any
prospectus supplement, before acquiring any of such securities. The risks incorporated herein by reference, any of which could materially and adversely affect our business, financial condition, cash flows and results of operations, are the material
risks of which we are currently aware; however, they may not be the only risks that we may face. Any of these risks could materially and adversely affect our business, financial condition, results of operations and cash flows. In that case, you may
lose all or part of your investment.
6
USE OF PROCEEDS
Unless otherwise indicated in the applicable prospectus supplement, we intend to use the net proceeds of any securities sold for general
corporate purposes. This may include, among other things, additions to working capital, repayment or refinancing of existing indebtedness or other corporate obligations, financing of capital expenditures and acquisitions, investment in existing and
future projects, and repurchases and redemptions of securities. Pending any specific application, we may initially invest funds in short-term marketable securities or apply them to the reduction of other indebtedness.
DESCRIPTION OF CAPITAL STOCK
The following summary is not complete. You should refer to the applicable provisions of our Restated Certificate of Incorporation, and
our Bylaws, as amended, and to Delaware corporate law for a complete understanding of the terms and rights of our common and preferred stock.
Common Stock
We are authorized to issue
750,000,000 shares of common stock, $0.25 par value per share, of which 482,987,752 shares of common stock were outstanding as of February 19, 2019. All of our currently outstanding shares of common stock are listed on the New York Stock
Exchange under the symbol “HL.”
Subject to the rights of the holders of any outstanding shares of preferred stock, each share
of common stock is entitled to: (i) one vote on all matters presented to the stockholders, with no cumulative voting rights; (ii) receive such dividends as may be declared by the Board of Directors out of funds legally available therefor;
and (iii) in the event of our liquidation or dissolution, share ratably in any distribution of our assets.
Holders of shares of
common stock do not have preemptive rights or other rights to subscribe for unissued or treasury shares or securities convertible into such shares, and no redemption or sinking fund provisions are applicable. All outstanding shares of common stock
are fully paid and nonassessable.
In September 2011 and February 2012, our Board of Directors adopted a common stock dividend policy that
has two components: (1) a dividend that links the amount of dividends on our common stock to our average quarterly realized silver price in the preceding quarter, and (2) a minimum annual dividend of $0.01 per share of common stock, in
each case payable quarterly, when declared. The following table summarizes the common
7
stock dividends declared by our Board of Directors under the policy described above for the years 2015, 2016, 2017 and 2018:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(A)
|
|
|
(B)
|
|
|
(C)
|
|
|
(A+B+C)
|
|
|
|
|
|
|
|
Declaration date
|
|
Silver-
price-
linked
component
per share
|
|
|
Minimum
annual
component
per share
|
|
|
Special
dividend
per share
|
|
|
Total
dividend
per share
|
|
|
Total
dividend
amount
(in millions)
|
|
|
Month of
payment
|
|
February 17, 2015
|
|
$
|
—
|
|
|
$
|
0.0025
|
|
|
$
|
—
|
|
|
$
|
0.0025
|
|
|
$
|
0.9
|
|
|
March 2015
|
|
May 6, 2015
|
|
$
|
—
|
|
|
$
|
0.0025
|
|
|
$
|
—
|
|
|
$
|
0.0025
|
|
|
$
|
0.9
|
|
|
June 2015
|
|
August 6, 2015
|
|
$
|
—
|
|
|
$
|
0.0025
|
|
|
$
|
—
|
|
|
$
|
0.0025
|
|
|
$
|
0.9
|
|
|
September 2015
|
|
November 3, 2015
|
|
$
|
—
|
|
|
$
|
0.0025
|
|
|
$
|
—
|
|
|
$
|
0.0025
|
|
|
$
|
0.9
|
|
|
December 2015
|
|
February 20, 2016
|
|
$
|
—
|
|
|
$
|
0.0025
|
|
|
$
|
—
|
|
|
$
|
0.0025
|
|
|
$
|
0.9
|
|
|
March 2016
|
|
May 4, 2016
|
|
$
|
—
|
|
|
$
|
0.0025
|
|
|
$
|
—
|
|
|
$
|
0.0025
|
|
|
$
|
1.0
|
|
|
June 2016
|
|
August 3, 2016
|
|
$
|
—
|
|
|
$
|
0.0025
|
|
|
$
|
—
|
|
|
$
|
0.0025
|
|
|
$
|
1.0
|
|
|
September 2016
|
|
November 4, 2016
|
|
$
|
—
|
|
|
$
|
0.0025
|
|
|
$
|
—
|
|
|
$
|
0.0025
|
|
|
$
|
1.0
|
|
|
December 2016
|
|
February 21, 2017
|
|
$
|
—
|
|
|
$
|
0.0025
|
|
|
$
|
—
|
|
|
$
|
0.0025
|
|
|
$
|
1.0
|
|
|
March 2017
|
|
May 4, 2017
|
|
$
|
—
|
|
|
$
|
0.0025
|
|
|
$
|
—
|
|
|
$
|
0.0025
|
|
|
$
|
1.0
|
|
|
June 2017
|
|
August 3, 2017
|
|
$
|
—
|
|
|
$
|
0.0025
|
|
|
$
|
—
|
|
|
$
|
0.0025
|
|
|
$
|
1.0
|
|
|
September 2017
|
|
November 7, 2017
|
|
$
|
—
|
|
|
$
|
0.0025
|
|
|
$
|
—
|
|
|
$
|
0.0025
|
|
|
$
|
1.0
|
|
|
December 2017
|
|
February 14, 2018
|
|
$
|
—
|
|
|
$
|
0.0025
|
|
|
$
|
—
|
|
|
$
|
0.0025
|
|
|
$
|
1.0
|
|
|
March 2018
|
|
May 9, 2018
|
|
$
|
—
|
|
|
$
|
0.0025
|
|
|
$
|
—
|
|
|
$
|
0.0025
|
|
|
$
|
1.0
|
|
|
June 2018
|
|
August 24, 2018
|
|
$
|
—
|
|
|
$
|
0.0025
|
|
|
$
|
—
|
|
|
$
|
0.0025
|
|
|
$
|
1.2
|
|
|
August 2018
|
|
November 7, 2018
|
|
$
|
—
|
|
|
$
|
0.0025
|
|
|
$
|
—
|
|
|
$
|
0.0025
|
|
|
$
|
1.2
|
|
|
December 2018
|
|
February 20, 2019
|
|
$
|
—
|
|
|
$
|
0.0025
|
|
|
$
|
—
|
|
|
$
|
0.0025
|
|
|
$
|
1.2
|
|
|
March 2019
|
Because the average realized silver prices for all periods in 2015, 2016, 2017, 2018 and the first two months
of 2019 were below the minimum threshold of $30, according to the policy no silver-price-linked component was declared or paid. Prior to 2011, no dividends had been declared on our common stock since 1990. We cannot pay dividends on our common stock
if we fail to pay dividends on our Series B preferred stock. The declaration and payment of common stock dividends is at the sole discretion of our Board of Directors, and there can be no assurance that we will continue to declare and pay common
stock dividends in the future.
Preferred Stock
Our Restated Certificate of Incorporation authorizes us to issue 5,000,000 shares of preferred stock, par value $0.25 per share. The preferred
stock is issuable in series with such voting rights, if any, designations, powers, preferences and other rights and such qualifications, limitations and restrictions as may be determined by our Board of Directors. The Board may fix the number of
shares constituting each series and increase or decrease the number of shares of any series. As of February 22, 2019, 157,816 shares were outstanding, all of which were shares of Series B preferred stock. All of the shares of our Series B
preferred stock are listed on the New York Stock Exchange under the symbol “HL PB.”
Ranking
The Series B preferred stock ranks senior to our common stock and any shares of Series A junior participating preferred stock (none of which
have ever been issued) with respect to payment of dividends, and amounts due upon liquidation, dissolution or winding up.
While any
shares of Series B preferred stock are outstanding, we may not authorize the creation or issuance of any class or series of stock that ranks senior to the Series B preferred stock as to dividends or amounts due upon liquidation, dissolution or
winding up without the consent of the holders of 66 2/3% of the outstanding
8
shares of Series B preferred stock and any other series of preferred stock ranking on a parity with the Series B preferred stock as to dividends and amounts due upon liquidation, dissolution or
winding up, voting as a single class without regard to series.
Dividends
Series B preferred stockholders are entitled to receive, when, as and if declared by the Board of Directors out of our assets legally available
therefor, cumulative cash dividends at the rate per annum of $3.50 per share of Series B preferred stock. Dividends on the Series B preferred stock are payable quarterly in arrears on October 1, January 1, April 1 and July 1 of
each year (and, in the case of any undeclared and unpaid dividends, at such additional times and for such interim periods, if any, as determined by the Board of Directors), at such annual rate. Dividends are cumulative from the date of the original
issuance of the Series B preferred stock, whether or not in any dividend period or periods we have assets legally available for the payment of such dividends. Accumulations of dividends on shares of Series B preferred stock do not bear interest.
All quarterly dividends on our Series B preferred stock for 2015, 2016, 2017, 2018 and the first quarter of 2019 were declared and paid
in cash.
Redemption
The Series B
preferred stock is redeemable at our option, in whole or in part, at $50 per share, plus, in each case, all dividends undeclared and unpaid on the Series B preferred stock up to the date fixed for redemption.
Liquidation Preference
The Series B
preferred stockholders are entitled to receive, in the event that we are liquidated, dissolved or wound up, whether voluntary or involuntary, $50 per share of Series B preferred stock plus an amount per share equal to all dividends undeclared and
unpaid thereon to the date of final distribution to such holders (the “Liquidation Preference”), and no more. Until the Series B preferred stockholders have been paid the Liquidation Preference in full, no payment will be made to any
holder of Junior Stock upon our liquidation, dissolution or winding up. The term “junior stock” means our common stock and any other class of our capital stock issued and outstanding that ranks junior as to the payment of dividends or
amounts payable upon liquidation, dissolution and winding up to the Series B preferred stock. As of December 31, 2018, our Series B preferred stock had an aggregate Liquidation Preference of $7.9 million.
Voting Rights
Except in certain
circumstances and as otherwise from time to time required by applicable law, the Series B preferred stockholders have no voting rights and their consent is not required for taking any corporate action. When and if the Series B preferred stockholders
are entitled to vote, each holder will be entitled to one vote per share.
Conversion
Each share of Series B preferred stock is convertible, in whole or in part at the option of the holders thereof, into shares of common stock at
a conversion price of $15.55 per share of common stock (equivalent to a conversion rate of 3.2154 shares of common stock for each share of Series B preferred stock). The right to convert shares of Series B preferred stock called for redemption will
terminate at the close of business on the day preceding a redemption date (unless we default in payment of the redemption price).
9
Provisions with Possible Anti-Takeover Effects
The provisions in our Restated Certificate of Incorporation, our Bylaws, as amended, and Delaware law could make it more difficult for a third
party to acquire control of us, even if that transaction would be beneficial to stockholders. These impediments include:
|
|
•
|
|
the classification of our Board of Directors into three classes serving staggered three-year terms, which makes
it more difficult to quickly replace board members;
|
|
|
•
|
|
the ability of our Board of Directors to issue shares of preferred stock with rights as it deems appropriate
without stockholder approval;
|
|
|
•
|
|
a provision that special meetings of our Board of Directors may be called only by our chief executive officer or
a majority of our Board of Directors;
|
|
|
•
|
|
a provision that special meetings of stockholders may only be called pursuant to a resolution approved by a
majority of our entire Board of Directors;
|
|
|
•
|
|
a prohibition against action by written consent of our stockholders;
|
|
|
•
|
|
a provision that our board members may only be removed for cause and by an affirmative vote of at least 80% of
the outstanding voting stock;
|
|
|
•
|
|
a provision that our stockholders comply with advance-notice provisions to bring director nominations or other
matters before meetings of our stockholders;
|
|
|
•
|
|
a prohibition against certain business combinations with an acquirer of 15% or more of our common stock for three
years after such acquisition unless the stock acquisition or the business combination is approved by our board prior to the acquisition of the 15% interest, or after such acquisition our board and the holders of
two-thirds
of the other common stock approve the business combination; and
|
|
|
•
|
|
a prohibition against our entering into certain business combinations with interested stockholders without the
affirmative vote of the holders of at least 80% of the voting power of the then outstanding shares of voting stock.
|
DESCRIPTION OF WARRANTS
We may issue warrants for the purchase of our debt securities, preferred stock, or common stock or units
of two or more of these types of securities. Warrants may be issued independently or together with debt securities, preferred stock or common stock and may be attached to or separate from these securities. Each series of warrants will be issued
under a separate warrant agreement. We will distribute a prospectus supplement with regard to each issue or series of warrants.
Warrants to Purchase
Debt Securities
Each prospectus supplement for warrants to purchase debt securities will describe:
|
|
•
|
|
the title of the debt warrants;
|
|
|
•
|
|
the aggregate number of the debt warrants;
|
|
|
•
|
|
the price or prices at which the debt warrants will be issued;
|
|
|
•
|
|
the designation, aggregate principal amount and terms of the debt securities purchasable upon exercise of the
debt warrants, and the procedures and conditions relating to the exercise of the debt warrants;
|
|
|
•
|
|
if applicable, the number of the warrants issued with a specified principal amount of our debt securities or each
share of our preferred stock or common stock;
|
|
|
•
|
|
if applicable, the date on and after which the debt warrants and the related securities will be separately
transferable;
|
10
|
|
•
|
|
the principal amount of and exercise price for debt securities that may be purchased upon exercise of each debt
warrant;
|
|
|
•
|
|
the maximum or minimum number of the debt warrants which may be exercised at any time;
|
|
|
•
|
|
if applicable, a discussion of any material federal income tax considerations; and
|
|
|
•
|
|
any other material terms of the debt warrants and terms, procedures and limitations relating to the exercise of
the debt warrants.
|
Certificates for warrants to purchase debt securities will be exchangeable for new debt warrant
certificates of different denominations. Warrants may be exercised at the corporate trust office of the warrant agent or any other office indicated in the prospectus supplement.
Warrants to Purchase Preferred Stock and Common Stock
Each prospectus supplement for warrants to purchase preferred stock or common stock will describe:
|
|
•
|
|
the title of the warrants;
|
|
|
•
|
|
the securities for which the warrants are exercisable;
|
|
|
•
|
|
the price or prices at which the warrants will be issued;
|
|
|
•
|
|
if applicable, the number of the warrants issued with each share of our preferred stock or common stock;
|
|
|
•
|
|
if applicable, the date on and after which such warrants and the related securities will be separately
transferable;
|
|
|
•
|
|
any provisions for adjustment of the number or amount of shares of our preferred stock or common stock receivable
upon exercise of the warrants or the exercise price of the warrants;
|
|
|
•
|
|
if applicable, a discussion of material federal income tax considerations; and
|
|
|
•
|
|
any other material terms of such warrants, including terms, procedures and limitations relating to the exchange
and exercise of such warrants.
|
Exercise of Warrants
Each warrant will entitle the holder of the warrant to purchase the principal amount of debt securities or number of shares of preferred stock
or common stock at the exercise price as shall in each case be set forth in, or be determinable as set forth in, the prospectus supplement relating to the warrants offered by the applicable prospectus supplement. Warrants may be exercised at any
time up to the close of business on the expiration date set forth in the applicable prospectus supplement. After the close of business on the expiration date, unexercised warrants will become void.
Upon receipt of payment and the warrant certificate properly completed and duly executed at the corporate trust office of the warrant agent or
any other office indicated in the prospectus supplement, we will, as soon as practicable, forward the debt securities or shares of preferred stock or common stock to be purchased upon such exercise. If less than all of the warrants represented by a
warrant certificate are exercised, a new warrant certificate will be issued for the remaining warrants.
Prior to the exercise of any
warrants to purchase debt securities, preferred stock or common stock, holders of the warrants will not have any of the rights of holders of the debt securities, preferred stock or common stock, including:
|
|
•
|
|
in the case of warrants for the purchase of debt securities, the right to receive payments of principal of, or
any premium or interest on, the debt securities purchasable upon exercise or to enforce covenants in the applicable indenture; or
|
11
|
|
•
|
|
in the case of warrants for the purchase of preferred stock or common stock, the right to vote or to receive any
payments of dividends on the preferred stock or common stock purchasable upon exercise.
|
Status of Outstanding Warrants
At December 31, 2018, we had 4,136,000 warrants outstanding, with each warrant exercisable for one share of our common stock at an
exercise price of $8.02 per share for 2,068,000 of the warrants and $1.57 per share for 2,068,000 of the warrants. The warrants expire in April 2032 and February 2029, respectively.
DESCRIPTION OF DEBT SECURITIES
The following is a general description of the debt securities that we may offer from time to time. The particular terms of the debt securities
offered by any prospectus supplement and the extent, if any, to which the general provisions described below may apply to those securities will be described in the applicable prospectus supplement. We also may sell hybrid securities that combine
certain features of debt securities and other securities described in this prospectus. As you read this section, please remember that the specific terms of a debt security as described in the applicable prospectus supplement will supplement and may
modify or replace the general terms described in this section. If there are differences between the applicable prospectus supplement and this prospectus, the applicable prospectus supplement will control. As a result, the statements we make in this
section may not apply to the debt security you purchase.
Additional 2021 Notes under the 2013 Indenture
On April 12, 2013, we completed an offering of $500 million in aggregate principal amount of our Senior Notes due May 1, 2021.
In 2014, we issued an additional $6.5 million aggregate principal amount of the Senior Notes due May 1, 2021 to our pension plan in order to satisfy the plan funding requirement for 2014 (all of our Senior Notes due May 1, 2021 are
referred to collectively as the “2021 Notes”). The 2021 Notes are governed by the Indenture, dated as of April 12, 2013, as supplemented, among Hecla Mining Company and certain of our subsidiaries and The Bank of New York Mellon Trust
Company, N.A., as trustee (the “2013 Indenture”). The 2013 Indenture has been filed as an exhibit to the registration statement of which this prospectus is a part and is subject to, and governed by, the Trust Indenture Act of 1939.
We may offer additional 2021 Notes, which additional notes would be issued pursuant to the 2013 Indenture. If we offer additional 2021 Notes,
we will describe the terms of such notes in a prospectus supplement applicable to such offering. Except as specifically set forth in such prospectus supplement, the general terms of our debt securities discussed below will not apply to the 2021
Notes.
Other Debt Securities
The
debt securities will represent unsecured general obligations of the Company, unless otherwise provided in the prospectus supplement. As indicated in the applicable prospectus supplement, the debt securities will either be senior debt, senior to all
future subordinated indebtedness of the Company and pari passu with other current and future unsecured, unsubordinated indebtedness of the Company or, in the alternative, subordinated debt subordinate in right of payment to current and future senior
debt or pari passu with other future subordinated indebtedness of the Company. The debt securities will be issued under an indenture in the form that is filed as Exhibit 4.3(d) to the registration statement of which this prospectus is a part and
incorporated by reference herein, subject to such amendments or supplemental indentures as are adopted from time to time. The indenture will be executed by the Company and one or more trustees. The following summary of certain provisions of the
indenture does not purport to be complete and is subject to, and qualified in its entirety by, reference to all the provisions of the indenture, including the definitions therein of certain terms. Capitalized terms used in this section and not
defined have the meanings assigned to those terms in the indenture. Wherever particular sections
12
or defined terms of the indenture are referred to, it is intended that such sections or defined terms shall be incorporated herein by reference.
General
Unless otherwise
indicated in a prospectus supplement, the indenture under which we may issue the debt securities will have the following provisions.
The
indenture will not limit the amount of debt securities that may be issued thereunder. Reference is made to the prospectus supplement for the following terms of the debt securities offered pursuant thereto: (i) designation (including whether
they are senior debt or subordinated debt and whether such debt is convertible), aggregate principal amount, purchase price and denomination; (ii) the date of maturity; (iii) interest rate or rates (or method by which such rate will be
determined), if any; (iv) the dates on which any such interest will be payable and the method of payment (cash or common stock); (v) the place or places where the principal of and interest, if any, on the debt securities will be payable;
(vi) any redemption or sinking fund provisions; (vii) any rights of the holders of debt securities to convert the debt securities into other securities or property of the Company; (viii) the terms, if any, on which such debt
securities will be subordinate to other debt of the Company; (ix) if other than the principal amount thereof, the portion of the principal amount of the debt securities that will be payable upon declaration of acceleration of the maturity
thereof or provable in bankruptcy; (x) any events of default in addition to or in lieu of those described herein and remedies therefor; (xi) any trustees, authenticating or paying agents, transfer agents or registrars or any other agents
with respect to the debt securities; (xii) listing (if any) on a securities exchange; (xiii) whether such debt securities will be certificated or in book-entry form; and (xiv) any other specific terms of the debt securities, including
any additional events of default or covenants provided for with respect to debt securities, and any terms that may be required by or advisable under United States laws or regulations.
Debt securities may be presented for exchange, conversion or transfer in the manner, at the places and subject to the restrictions set forth
in the debt securities and the prospectus supplement. The Company may charge a reasonable fee for such services, subject to the limitations provided in the indenture.
Debt securities will bear interest at a fixed rate or a floating rate. Debt securities bearing no interest or interest at a rate that, at the
time of issuance, is below the prevailing market rate, will be sold at a discount below their stated principal amount. Special United States federal income tax considerations applicable to any such discounted debt securities or to any debt
securities issued at par that is treated as having been issued at a discount for United States income tax purposes will be described in the relevant prospectus supplement.
The indenture will not contain any covenant or other specific provision affording protection to holders of the debt securities in the event of
a highly leveraged transaction or a change in control of the Company, except to the
limited extent described below under “— Consolidation,
Merger and Sale of Assets.” The Company’s restated certificate of incorporation also contains other provisions that may prevent or limit a change of control.
Modification and Waiver
The
indenture will provide that modifications and amendments of the indenture may be made by the Company and the Trustee, with the consent of the holders of a majority in aggregate principal amount of the outstanding Securities issued under the
indenture that are affected by the modification or amendment voting as one class; provided that no such modification or amendment may, without the consent of the holder of each such Security affected thereby, among other things: (1) change the
stated maturity of principal of, or any installment of principal of or interest on, any Security, (2) reduce the rate of or extend the time of payment of interest, if any, on any Security or alter the manner of calculation of interest payable
on any Security (except as part of any remarketing of the Securities of any series, or any interest rate reset with respect thereto in each case in accordance with the terms thereof), (3) reduce the principal amount or premium, if any, on any
Security,
13
(4) make the principal amount or premium, if any, or interest, if any, on any Security payable in any coin or currency other than that provided in any Security, (5) reduce the
percentage in principal amount of Securities of any series the holders of which are required to consent to any such supplemental indenture or any waiver of any past default or Event of Default, (6) change any place of payment where the
Securities of any series or interest thereon is payable, or (7) impair the right of any holder of a Security to institute suit for any such payment, reduce the amount of the principal of an Original Issue Discount Security that would be due and
payable upon an acceleration of the maturity thereof, adversely affect the right of repayment, if any, at the option of the holder or extend the time or reduce the amount of any payment to any sinking fund or analogous obligation relating to any
Security. Any amendment or waiver that waives, changes or eliminates any covenant or other provision of the indenture that has expressly been included solely for the benefit of one or more particular series, or that modifies the rights of the
holders of Securities of such series with respect to such covenant or other provision, shall be deemed not to affect the rights under the indenture of the holders of Securities of any other series.
The indenture will provide that a supplemental indenture that changes or eliminates any covenant or other provision of the indenture that has
expressly been included solely for the benefit of one or more particular series of debt securities, or that modifies the rights of the holders of such series with respect to such covenant or other provision, shall be deemed not to affect the rights
under the indenture of the holders of debt securities of any other series.
The indenture in the form filed as an exhibit hereto, and each
supplemental indenture entered into thereunder, will provide that the Company and the applicable trustee may, without the consent of the holders of any series of debt securities issued thereunder, amend the indenture or enter into supplemental
indentures for one or more of the following purposes: (1) to evidence the succession of another corporation to the Company and the assumption by any such successor of the covenants, agreements and obligations of the Company in the indenture and
in the debt securities issued thereunder, (2) to add any additional Events of Default; (3) to cure any ambiguity, defect or inconsistency; (4) to make any change that does not adversely affect the interests of the holders of any
series of debt securities issued thereunder; (5) to establish the form and terms of debt securities issued thereunder; (6) to set forth the conversion rights of any series; and (7) to set forth the provisions regarding subordination
of any series.
Events of Default
Unless otherwise provided in any prospectus supplement, the following will be events of default under the indenture with respect to each series
of debt securities issued thereunder: (1) the Company defaults in the payment of interest on any Security of that series when the same becomes due and payable and such Default continues for a period of 30 days; (2) the Company defaults in
the payment of the principal of any Security of that series when the same becomes due and payable at maturity, upon redemption or otherwise; (3) the Company fails to comply with any of its other agreements in the Securities of that series or
the indenture with respect to that series and such failure continues for the period and after the notice specified in the indenture; (4) the Company pursuant to or within the meaning of any bankruptcy law: (A) commences a voluntary case,
(B) consents to the entry of an order for relief against it in an involuntary case, (C) consents to the appointment of a custodian of it or for all or substantially all of its property, or (D) makes a general assignment for the
benefit of its creditors; (5) a court of competent jurisdiction enters an order or decree under any bankruptcy law that: (A) is for relief against the Company in an involuntary case, (B) appoints a custodian of the Company or for all
or substantially all of its property, or (C) orders the liquidation of the Company, and the order or decree remains unstayed and in effect for 60 days; or (6) an Event of Default provided in the establishing securities resolution or
supplemental indenture for that series occurs. Any event of default with respect to particular series of debt securities under the indenture may be waived by the holders of a majority in aggregate principal amount of the outstanding debt securities
of such series (voting as a class), except in each case a failure to pay principal or interest on such debt securities or a default in respect of a covenant or provision which cannot be modified or amended without the consent of each holder affected
thereby.
14
The Company will be required to furnish to the Trustee annually a statement as to its
compliance with all conditions and covenants in the indenture.
The indenture will contain a provision entitling the Trustee to be
indemnified by the holders of Securities before proceeding to exercise any trust or power under the indenture at the request of such holders. The indenture will provide that the holders of a majority in aggregate principal amount of the then
outstanding Securities of any series may direct the time, method and place of conducting any proceedings for any remedy available to the Trustee or of exercising any trust or power conferred upon the Trustee with respect to the Securities of such
series; provided, however, that the Trustee may decline to follow any such direction if, among other reasons, the Trustee determines in good faith that the actions or proceedings as directed may not lawfully be taken, would involve the Trustee in
personal liability or would be unduly prejudicial to the holders of the Securities of such series not joining in such direction. The right of a holder to institute a proceeding with respect to the indenture will be subject to certain conditions
precedent including, without limitation, that the holders of not less than 25% in aggregate principal amount of the Securities of such series then outstanding under the indenture make a request upon the Trustee to exercise its powers under the
indenture, indemnify the Trustee and afford the Trustee reasonable opportunity to act, but the holder has an absolute right to receipt of the principal of, premium, if any, and interest when due on the Securities, to require conversion of Securities
if the indenture provides for convertibility at the option of the holder and to institute suit for the enforcement thereof.
Consolidation, Merger
and Sale of Assets
The indenture will provide that the Company may not consolidate with, merge into or sell, convey or lease all
or substantially all of its assets to any person unless the Company is the surviving corporation or the successor person is a corporation organized under the laws of any domestic or Canadian jurisdiction and assumes the Company’s obligations on
the debt securities issued thereunder, and under the indenture, and after giving effect thereto no event of default, and no event that, after notice or lapse of time or both, would become an event of default shall have occurred and be continuing,
and that certain other conditions are met.
Certain Covenants
Payment of Securities
.
The Company shall pay the principal of and interest on the Securities of any series on the dates and in
the manner provided in the Securities of such series and the indenture. The Company shall pay interest on overdue principal of any series at the rate borne by the Securities of any series; it shall pay interest on overdue Defaulted Interest at
the same rate to the extent lawful.
SEC Reports
.
The Company shall file with the Trustee within 15 days after it files
them with the SEC copies of the annual reports and of the information, documents, and other reports which the Company is required to file with the SEC pursuant to Section 13 or 15(d) of the Exchange Act. The Company will cause any quarterly and
annual reports which it makes available to its stockholders to be mailed to the holders of Securities. The Company will also comply with the other provisions of § 314(a) of the Trust Indenture Act of 1939. Delivery of such reports, information
and documents to the Trustee is for informational purposes only and the Trustee’s receipt of such shall not constitute notice or constructive notice of any information contained therein or determinable from information contained therein,
including the Company’s compliance with any of its covenants hereunder (as to which the Trustee is entitled to rely exclusively on Officers’ Certificates).
Compliance Certificate
.
The Company shall deliver to the Trustee, no later than May 1 of each year (beginning with the
first May 1 following the first date of issuance of any Securities under the indenture), a brief certificate signed by the principal executive officer, principal financial officer or principal accounting officer of the Company, as to the
signer’s knowledge of the Company’s compliance with all conditions and covenants contained in the indenture (determined without regard to any period of grace or requirement of notice provided herein).
15
Notice of Certain Events
.
The Company shall give prompt written notice to
the Trustee and any Paying Agent with respect to any series of (i) any Proceeding, (ii) any Default or Event of Default, (iii) any cure or waiver of any Default or Event of Default, and (iv) if and when the Securities of such
series are listed on any stock exchange.
Additional Covenants
. Any additional covenants of the Company with respect to any
series of debt securities will be set forth in the prospectus supplement relating thereto.
Conversion Rights
The terms and conditions, if any, upon which the debt securities are convertible into common stock will be set forth in the applicable
prospectus supplement relating thereto. Such terms will include the conversion price (or manner of calculation thereof), the conversion period, provisions as to whether conversion will be at the option of the holders or the Company, the events
requiring an adjustment of the conversion price and provisions affecting conversion in the event of redemption of such debt securities and any restrictions on conversion.
Discharge, Defeasance and Covenant Defeasance
The indenture will provide with respect to each series of Securities issued thereunder that the Company may terminate its obligations under
such Securities of a series and the indenture with respect to Securities of such series when (1) either (A) all Securities theretofore authenticated and delivered (other than (i) Securities which have been destroyed, lost or stolen
and which have been replaced or paid and (ii) Securities for whose payment money has theretofore been deposited in trust or segregated and held in trust by the Company and thereafter repaid to the Company or discharged from such trust) have
been delivered to the Trustee for cancellation; or (B) all such Securities not theretofore delivered to the Trustee for cancellation (i) have become due and payable, or (ii) will become due and payable at their stated maturity within
one year, or (iii) are to be called for redemption within one year under arrangements satisfactory to the Trustee for the giving of notice of redemption by the Trustee in the name, and at the expense, of the Company, and the Company in the case
of (i), (ii), and (iii) above, has deposited or caused to be deposited with the Trustee for that purpose an amount of money or U.S. Government Obligations sufficient to pay and discharge the entire indebtedness on such Securities not
theretofore delivered to the Trustee for cancellation, for principal and interest to the date of such deposit (in the case of Securities which have become due and payable) or to the stated maturity or redemption date, as the case may be;
(2) the Company has paid or caused to be paid all other sums payable under the indenture by the Company; and (3) the Company has delivered to the Trustee an Officers’ Certificate and an Opinion of Counsel, each stating that all
conditions precedent herein provided for relating to the satisfaction and discharge of the indenture have been complied with. Thereafter, only the Company’s obligations to compensate and indemnify the Trustee and its right to recover excess
money held by the Trustee shall survive.
Applicable Law
The indenture will provide that the debt securities and the indenture will be governed by and construed in accordance with the laws of the
State of New York.
DESCRIPTION OF GUARANTIES
We will set forth in the applicable prospectus supplement a description of any guaranties that may be offered pursuant to this prospectus. The
guaranties will be governed by the laws of the State of New York.
16
PLAN OF DISTRIBUTION
The securities being offered by this prospectus may be sold by us:
|
|
•
|
|
to or through underwriters;
|
|
|
•
|
|
through broker-dealers (acting as agent or principal);
|
|
|
•
|
|
directly by us to purchasers, through a specific bidding or auction process or otherwise; or
|
|
|
•
|
|
through a combination of any such methods of sale.
|
The distribution of securities may be effected from time to time in one or more transactions, including block transactions and transactions on
the New York Stock Exchange or any other organized market where the securities may be traded. The securities may be sold at a fixed price or prices, which may be changed, or at market prices prevailing at the time of sale, at prices relating to the
prevailing market prices or at negotiated prices. The consideration may be cash or another form negotiated by the parties. Agents, underwriters or broker-dealers may be paid compensation for offering and selling the securities. That compensation may
be in the form of discounts, concessions or commissions to be received from us or from the purchasers of the securities. Dealers and agents participating in the distribution of the securities may be deemed to be underwriters, and compensation
received by them on resale of the securities may be deemed to be underwriting discounts. If such dealers or agents were deemed to be underwriters, they may be subject to statutory liabilities under the Securities Act.
Agents may from time to time solicit offers to purchase the securities. If required, we will name in the applicable prospectus supplement any
agent involved in the offer or sale of the securities and set forth any compensation payable to the agent. Unless otherwise indicated in the prospectus supplement, any agent will be acting on a best efforts basis for the period of its appointment.
Any agent selling the securities covered by this prospectus may be deemed to be an underwriter, as that term is defined in the Securities Act, of the securities.
If underwriters are used in a sale, securities will be acquired by the underwriters for their own account and may be resold from time to time
in one or more transactions, including negotiated transactions, at a fixed public offering price or at varying prices determined at the time of sale, or under delayed delivery contracts or other contractual commitments. Securities may be offered to
the public either through underwriting syndicates represented by one or more managing underwriters or directly by one or more firms acting as underwriters. If an underwriter or underwriters are used in the sale of securities, an underwriting
agreement will be executed with the underwriter or underwriters at the time an agreement for the sale is reached. The applicable prospectus supplement will set forth the managing underwriter or underwriters, as well as any other underwriter or
underwriters, with respect to a particular underwritten offering of securities, and will set forth the terms of the transactions, including compensation of the underwriters and dealers and the public offering price, if applicable. The prospectus and
prospectus supplement will be used by the underwriters to resell the securities.
If a dealer is used in the sale of the securities, we or
an underwriter will sell the securities to the dealer, as principal. The dealer may then resell the securities to the public at varying prices to be determined by the dealer at the time of resale. To the extent required, we will set forth in the
prospectus supplement the name of the dealer and the terms of the transactions.
We may directly solicit offers to purchase the securities
and we may make sales of securities directly to institutional investors or others. These persons may be deemed to be underwriters within the meaning of the Securities Act with respect to any resale of the securities. To the extent required, the
prospectus supplement will describe the terms of any such sales, including the terms of any bidding or auction process, if used.
Agents,
underwriters and dealers may be entitled under agreements which may be entered into with us to indemnification by us against specified liabilities, including liabilities incurred under the Securities Act, or to
17
contribution by us to payments they may be required to make in respect of such liabilities. If required, the prospectus supplement will describe the terms and conditions of such indemnification
or contribution. Some of the agents, underwriters or dealers, or their affiliates may be customers of, engage in transactions with or perform services for us or our subsidiaries in the ordinary course of business.
Under the securities laws of some states, the securities offered by this prospectus may be sold in those states only through registered or
licensed brokers or dealers.
Any person participating in the distribution of common stock registered under the registration statement
that includes this prospectus will be subject to applicable provisions of the Exchange Act, and the applicable SEC rules and regulations, including, among others, Regulation M, which may limit the timing of purchases and sales of any of our common
stock by any such person. Furthermore, Regulation M may restrict the ability of any person engaged in the distribution of our common stock to engage in market-making activities with respect to our common stock. These restrictions may affect the
marketability of our common stock and the ability of any person or entity to engage in market-making activities with respect to our common stock.
Certain persons participating in an offering may engage in over-allotment, stabilizing transactions, short-covering transactions and penalty
bids in accordance with Regulation M under the Exchange Act that stabilize, maintain or otherwise affect the price of the offered securities. For a description of these activities, see the information under the heading “Underwriting” in
the applicable prospectus supplement.
WHERE YOU CAN FIND MORE INFORMATION
We file annual, quarterly and current reports, proxy statements and other information with the SEC. Our SEC filings are available to the
public from the SEC’s web site at
http://www.sec.gov
or call the SEC at
800-SEC-0330. Information
about us, including our SEC filings, is also
available through our web site at
http://www.hecla-mining.com
. However, information on our web site is not incorporated into this prospectus or our other SEC filings and is not a part of this prospectus or those filings.
This prospectus is part of a registration statement filed by us with the SEC. The exhibits to our registration statement or to documents
filed under the Exchange Act and incorporated by reference herein contain the full text of certain contracts and other important documents we have summarized in this prospectus. Since these summaries may not contain all the information that you
may find important in deciding whether to purchase the securities that may be offered under this prospectus, you should review the full text of these documents. The registration statement and the exhibits can be obtained from the SEC as
indicated above, or from us.
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
The SEC allows us to “incorporate by reference” the information we file with the SEC. This means that we can disclose important
information to you by referring you to another filed document. Any information referred to in this way is considered part of this prospectus from the date we file that document. Any reports filed by us with the SEC after the date of this
prospectus and before the date that the offering of the securities by means of this prospectus is terminated will automatically update and, where applicable, supersede any information contained in this prospectus or incorporated by reference in this
prospectus. Accordingly, we incorporate by reference the following documents or information filed with the SEC:
|
|
•
|
|
Annual Report on Form
10-K
for the year ended December 31, 2018,
which we filed with the SEC on February 22, 2019;
|
|
|
•
|
|
Current Reports on
Form 8-K
filed on February 21, 2019
(Item 8.01 only) and July 24, 2018 (Item 9.01(a) and (d) Exhibits 99.2 and 99.3 only);
|
|
|
•
|
|
The description of our capital stock contained in our Form
8-B
filed with
the SEC on May 6, 1983;
|
18
|
|
•
|
|
The information responsive to Part III of Form
10-K
for the year ended
December 31, 2017, provided in our Definitive Proxy Statement on Schedule 14A filed with the SEC on April 9, 2018; and
|
|
|
•
|
|
All documents filed by us in accordance with Sections 13(a), 13(c), 14 or 15(d) of the Exchange Act on or after
the date of this prospectus and before the termination of an offering under this prospectus, other than documents or information deemed furnished and not filed in accordance with SEC rules.
|
We will provide to each person, including any beneficial owner, to whom a copy of this prospectus has been delivered, without charge, upon the
written or oral request of such person, a copy of any or all of the documents which are incorporated by reference into this prospectus, other than exhibits to such documents, unless such exhibits are specifically incorporated by reference into the
information that this prospectus incorporates. You should direct requests for such copies to:
Hecla Mining Company
6500 North Mineral Drive, Suite 200
Coeur d’Alene, Idaho 83815
Attention: Investor Relations
Telephone (208)
769-4100
LEGAL MATTERS
Unless otherwise specified in a prospectus supplement accompanying this prospectus, David C. Sienko, our General Counsel, will pass upon
certain legal matters for us in connection with the securities offered by this prospectus.
EXPERTS
The consolidated financial statements as of December 31, 2018 and 2017 and for each of the three years in the period ended
December 31, 2018 and management’s assessment of the effectiveness of internal control over financial reporting as of December 31, 2018 incorporated by reference in this prospectus have been so incorporated in reliance on the reports
of BDO USA, LLP, an independent registered public accounting firm, incorporated herein by reference, given on the authority of said firm as experts in auditing and accounting.
The audited historical financial statements of Klondex Mines Ltd. as of and for the years ended December 31, 2017 and 2016, included in
Hecla Mining Company’s Current Report on Form 8-K dated July 24, 2018 and incorporated by reference in this prospectus have been so incorporated in reliance on the reports of PricewaterhouseCoopers LLP, independent public accounting
firm, given on the authority of said firm as experts in auditing and accounting.
19
Hecla Mining Co. Prfd B (NYSE:HLPB)
Historical Stock Chart
From Oct 2024 to Nov 2024
Hecla Mining Co. Prfd B (NYSE:HLPB)
Historical Stock Chart
From Nov 2023 to Nov 2024
