Hecla Increases Interest in Dolly Varden Silver Corporation
October 01 2015 - 02:11AM
Business Wire
Hecla Mining Company (NYSE:HL) (“Hecla”) announced today
that a wholly owned subsidiary of Hecla (“Hecla Sub”) has
entered into a credit agreement (the “Credit Agreement”)
with Dolly Varden Silver Corporation (“Dolly Varden”) and
another significant shareholder of Dolly Varden, Robert L. Gipson,
as lenders (the “Lenders”) providing for a senior,
non-revolving secured loan (the “Loan”) of CDN$1,500,000.
Pursuant to the Credit Agreement, Hecla Sub will act as agent on
behalf of the Lenders and the Lenders have severally and not
jointly agreed to advance CDN$750,000 each to Dolly Varden. An
additional CDN$500,000 may be made available to Dolly Varden in the
discretion of the Lenders, and in that event, each Lender will have
the option to advance its pro rata share of such additional amount.
The net proceeds of the Loan will be used by Dolly Varden for: (i)
exploration of the Dolly Varden project in north-western British
Columbia; and (ii) working capital purposes.
Pursuant to the Credit Agreement, the Loan will be secured by
promissory notes and first ranking security over all of Dolly
Varden’s assets. The Loan will bear interest at a rate of 5% per
annum, will be repayable after one year and may be repaid earlier
with no penalty.
In connection with the Credit Agreement, and as consideration
for the advance of its portion of the Loan, Hecla has acquired
control over 1,250,000 warrants of Dolly Varden (the
“Warrants”), constituting 50% of the Warrants issued by
Dolly Varden pursuant to the Credit Agreement. Each Warrant
entitles the holder to acquire one common share of Dolly Varden at
a price of $0.30 per share and is exercisable for a period of three
years from the date of issuance.
The 1,250,000 common shares underlying the Warrants, if the
Warrants are exercised and such shares are issued, would represent
6.4% of the outstanding common shares of Dolly Varden. Hecla
currently exercises control over 2,620,291 common shares of Dolly
Varden, representing approximately 14.3% of the outstanding common
shares of Dolly Varden. Assuming the exercise of only the Warrants
that are held by Hecla Sub, Hecla would exercise control over
3,870,291 common shares of Dolly Varden or approximately 19.8% of
Dolly Varden’s common shares.
The Warrants have been acquired by Hecla for investment
purposes. Hecla does not have any present intention to acquire
ownership of, or control over, additional securities of Dolly
Varden. It is the intention of Hecla to evaluate its investment in
Dolly Varden on a continuing basis and such holdings may be
increased or decreased in the future.
In completing this investment Hecla is relying on Subsection
2.3(1) of Canadian National Instrument 45-106 – Prospectus and
Registration Exemptions as Hecla is an accredited investor. For the
purposes of Canadian National Instrument 62-103, the address of
Hecla is 6500 N. Mineral Drive, Suite 200, Coeur d’Alene, Idaho,
83815, USA.
About Hecla Mining Company
Hecla Mining Company (NYSE:HL) is a leading low-cost U.S. silver
producer with operating mines in Alaska and Idaho, and is a gold
producer with an operating mine in Quebec, Canada. The Company also
has exploration and pre-development properties in six 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.
Cautionary Statements
Statements made which are not historical facts, such as
regarding any increase in the amount of the Loan and exercise of
the Warrants, are “forward-looking statements” within the meaning
of the Private Securities Litigation Reform Act of 1995. 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, metals price
volatility, volatility of metals production and costs,
environmental and litigation risks, operating risks, project
development risks, political and regulatory risks, labor issues,
ability to raise financing and exploration risks and results. Refer
to the company’s Form 10-K and 10-Q reports for a more detailed
discussion of factors that may impact expected future results.
Hecla undertakes no obligation and has no intention of updating
forward-looking statements other than as may be required by
law.
For further information, or to obtain a copy of the early
warning report filed in connection with Hecla’s holdings in Dolly
Varden, please contact:
Jeanne DuPontCorporate Communications CoordinatorInvestor and
Public Relations1-800-HECLA91
(1-800-432-5291)hmc-info@hecla-mining.com
View source
version on businesswire.com: http://www.businesswire.com/news/home/20150930006971/en/
Hecla Mining CompanyJeanne DuPont, 1-800-HECLA91
(1-800-432-5291)Corporate Communications CoordinatorInvestor and
Public Relationshmc-info@hecla-mining.com
Hecla Mining (NYSE:HL)
Historical Stock Chart
From Feb 2024 to Mar 2024
Hecla Mining (NYSE:HL)
Historical Stock Chart
From Mar 2023 to Mar 2024