Revett has reported a Rock Creek inferred
resource of 229 million ounces of silver and 2.0 billion pounds of
copper.¹ Permitting underway.
Hecla Mining Company (NYSE:HL) (Hecla) and Revett Mining
Company, Inc. (NYSE MKT:RVM) (TSX:RVM) (Revett) today announced
that they have entered into a merger agreement pursuant to which
Hecla will acquire Revett. In the proposed merger, each outstanding
common share of Revett will be exchanged for 0.1622 of a common
share of Hecla. Based on Hecla’s closing price of $3.23 on March
25, 2015 (the day prior to signing of the agreement), this
represents a 32% premium to Revett’s 20-day VWAP (volume weighted
average price) through March 25, 2015. The parties currently expect
the transaction to close late in the second quarter, 2015. The
transaction is subject to approval by Revett shareholders and to
the satisfaction of other closing conditions contained in the
merger agreement.
Following closing of the merger, Hecla intends to continue to
advance permitting of the Rock Creek project. Located in Northwest
Montana, Rock Creek is considered one of the largest undeveloped
silver and copper deposits in North America. Revett has reported
inferred resources of 229 million ounces of silver and 2.0 billion
pounds of copper. The project is approximately 50 miles north of
Hecla’s Lucky Friday Mine in Idaho. A Supplemental Environmental
Impact Statement (SEIS) is in process and the U.S. Forest Service
schedule indicates that the SEIS will be issued later this year for
public comment.
“We are acquiring Revett with an eye to the future, as Rock
Creek is a world-class silver-copper deposit that we see becoming
another Greens Creek,” said Phillips S. Baker, Jr., Hecla’s
President and CEO. “Our experience of Greens Creek operating in a
National Monument in Alaska since 1997 will be invaluable as we
take a patient and persistent approach to permitting and then
responsibly operating the Rock Creek Mine. Combining this
operational expertise with our financial strength, and an
unwavering commitment to safety and building strong community
relationships, gives us confidence that we are well-positioned to
move Rock Creek forward, to the benefit of all stakeholders.”
John Shanahan, Revett’s President and CEO, commented: “Current
market conditions do not allow us to maintain the Troy Mine on care
and maintenance and pursue our objective of developing Rock Creek.
We share similar core values with Hecla and see them as the company
with the financial and technical capabilities to develop the
potentially world-class Rock Creek deposit in an efficient and
responsible manner. We believe our shareholders, along with the
communities of northwest Montana who have been so supportive in our
endeavors, will benefit greatly from this merger.”
Following the merger, Hecla expects to close and reclaim the
Troy Mine and associated facilities. The mine was placed on care
and maintenance in January 2015 by Revett. The companies believe
that the cost of reclamation at Troy will be borne by the current
insurance-backed reclamation policy that was established by Revett
for that purpose.
Roman Friedrich & Company LLC is acting as financial advisor
to Revett on this transaction and rendered a fairness opinion to
Revett’s Board of Directors in connection with the transaction.
About Hecla
Hecla Mining Company (NYSE:HL) is a leading low-cost U.S. silver
producer with operating mines in Alaska and Idaho, and is a growing
gold producer with an operating mine in Quebec, Canada. The Company
also has exploration and pre-development properties in five
world-class silver and gold mining districts in the U.S., Canada,
and Mexico, and an exploration office and investments in
early-stage silver exploration projects in Canada.
Hecla will file with the SEC a registration statement on Form
S-4 (or amendment thereto) that will include the Proxy Statement of
Revett that also constitutes a prospectus of Hecla. Hecla and
Revett plan to mail the Proxy Statement/Prospectus to Revett’s
shareholders in connection with the transaction. INVESTORS AND
SHAREHOLDERS ARE URGED TO READ THE PROXY STATEMENT/PROSPECTUS AND
OTHER RELEVANT DOCUMENTS FILED OR TO BE FILED WITH THE SEC
CAREFULLY WHEN THEY BECOME AVAILABLE BECAUSE THEY WILL CONTAIN
IMPORTANT INFORMATION ABOUT HECLA, REVETT, THE TRANSACTION AND
RELATED MATTERS. Investors and shareholders will be able to obtain
free copies of the Proxy Statement/Prospectus and other documents
filed with the SEC by Hecla and Revett through the website
maintained by the SEC at www.sec.gov. In addition, investors and
shareholders will be able to obtain free copies of the Proxy
Statement/Prospectus and other documents filed by Hecla with the
SEC by contacting Hecla’s Investor Relations department at Hecla
Mining Company; Investor Relations; 1-800-HECLA91 (1-800-432-5291);
hmc-info@hecla-mining.com, and will be able to obtain free copies
of the Proxy Statement/Prospectus and other documents filed by
Revett by contacting Revett Investor Relations at 509-921-2294 or
by calling 1-866-921-2294.
Hecla and Revett and their respective directors and executive
officers may be deemed to be participants in the solicitation of
proxies from the shareholders of Revett in respect of the
transaction described in the Proxy Statement/Prospectus.
Information regarding the persons who may, under the rules of the
SEC, be deemed participants in the solicitation of the shareholders
of Revett in connection with the proposed transaction, including a
description of their direct or indirect interests, by security
holdings or otherwise, will be set forth in the Proxy
Statement/Prospectus when it is filed with the SEC. Information
regarding Hecla’s directors and executive officers is contained in
Hecla’s Annual Report on Form 10-K for the year ended December 31,
2014, and its Proxy Statement on Schedule 14A, dated April 8, 2014,
which are filed with the SEC. Information regarding Revett’s
directors and executive officers is contained in Revett’s Annual
Report on Form 10-K for the year ended December 31, 2013, and its
Proxy Statement on Schedule 14A, dated May 6, 2014, which are filed
with the SEC.
Cautionary Note Regarding Forward-Looking Statements
Statements made or information provided in this news release
that are not historical facts, such as anticipated production,
sales of assets, exploration results and plans, costs, and prices
or sales performance are “forward-looking statements” within the
meaning of the Private Securities Litigation Reform Act of 1995 and
“forward-looking information” within the meaning of Canadian
securities laws. Words such as “may,” “will,” “should,” “expects,”
“intends,” “projects,” “believes,” “estimates,” “targets,”
“anticipates” and similar expressions are used to identify these
forward-looking statements. Forward-looking statements involve a
number of risks and uncertainties that could cause actual results
to differ materially from those projected, anticipated, expected or
implied. These risks and uncertainties include, but are not limited
to, risks associated with completion of the merger, the risk that
expected synergies or cost savings resulting from the merger might
not be achieved, the risk that the permitting process for the Rock
Creek Mine could be more difficult than anticipated, the risk that
Troy Mine reclamation costs could substantially exceed current
estimates, metals price volatility, volatility of metals production
and costs, litigation, regulatory and environmental risks,
operating risks, project development risks, political risks, labor
issues, ability to raise financing and exploration risks and
results. Refer to Hecla’s and Revett’s Form 10-K and 10-Q reports
for a more detailed discussion of factors that may impact expected
future results. Hecla and Revett undertake no obligation and have
no intention of updating forward-looking statements other than as
may be required by law.
Cautionary Statements to Investors on Reserves and Resources
Reporting requirements in the United States for disclosure of
mineral properties are governed by the SEC and included in the
SEC’s Securities Act Industry Guide 7, entitled “Description of
Property by Issuers Engaged or to be Engaged in Significant Mining
Operations” (Guide 7). However, the Company is also a “reporting
issuer” under Canadian securities laws, which require estimates of
mineral resources and reserves to be prepared in accordance with
Canadian National Instrument 43-101 (NI 43-101). NI 43-101 requires
all disclosure of estimates of potential mineral resources and
reserves to be disclosed in accordance with its requirements. Such
Canadian information is being included here to satisfy the
Company’s “public disclosure” obligations under Regulation FD of
the SEC and to provide U.S. holders with ready access to
information publicly available in Canada.
Reporting requirements in the United States for disclosure of
mineral properties under Guide 7 and the requirements in Canada
under NI 43-101 standards are substantially different. This
document contains a summary of certain estimates of Revett, not
only of proven and probable reserves within the meaning of Guide 7,
which requires the preparation of a “final” or “bankable”
feasibility study demonstrating the economic feasibility of mining
and processing the mineralization using the three-year historical
average price for any reserve or cash flow analysis to designate
reserves and that the primary environmental analysis or report be
filed with the appropriate governmental authority, but also of
mineral resource and mineral reserve estimates estimated in
accordance with the definitional standards of the Canadian
Institute of Mining, Metallurgy and Petroleum referred to in NI
43-101. The terms “indicated resources,” and “inferred resources”
are Canadian mining terms as defined in accordance with NI 43-101.
These terms are not defined under Guide 7 and are not normally
permitted to be used in reports and registration statements filed
with the SEC in the United States, except where required to be
disclosed by foreign law. The term “resource” does not equate to
the term “reserve.” Under Guide 7, the material described herein as
“indicated resources” and “measured resources” would be
characterized as “mineralized material” and is permitted to be
disclosed in tonnage and grade only, not ounces. The category of
“inferred resources” is not recognized by Guide 7. Investors are
cautioned not to assume that any part or all of the mineral
deposits in such categories will ever be converted into proven or
probable reserves. “Resources” have a great amount of uncertainty
as to their existence, and great uncertainty as to their economic
and legal feasibility. It cannot be assumed that all or any part of
such a “resource” will ever be upgraded to a higher category or
will ever be economically extracted. Investors are cautioned not to
assume that all or any part of a “resource” exists or is
economically or legally mineable. Investors are also especially
cautioned that the mere fact that such resources may be referred to
in ounces of silver and/or gold, rather than in tons of
mineralization and grades of silver and/or gold estimated per ton,
is not an indication that such material will ever result in mined
ore which is processed into commercial silver or gold.
(1) Refer to cautionary note on reserves and resources.
Hecla Mining CompanyMike Westerlund,
604-694-7729hmc-info@hecla-mining.comVice President, Investor
Relations
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