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SECURITIES AND EXCHANGE COMMISSION
Washington D.C. 20549
_____________
FORM 8-K
PURSUANT TO SECTION 13 OR 15(D) OF THE
SECURITIES EXCHANGE ACT OF 1934
Date of Report
(Date of earliest event reported): March 27, 2001
Hecla Mining Company
_______________________________________________________________________________
(Exact name of registrant as specified in its charter)
Delaware
_______________________________________________________________________________
(State or other jurisdiction of incorporation)
1-8491 82-0126240
_______________________________________________________________________________
(Commission File Number) (IRS Employer Identification No.)
6500 Mineral Drive
Coeur d'Alene, Idaho 83815-8788
_______________________________________________________________________________
(Address of principal executive offices) (Zip Code)
(208) 769-4100
_______________________________________________________________________________
(Registrant's Telephone Number)
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Item 2. Acquisition or Disposition of Assets.
On March 27, 2001, Hecla Mining Company (Hecla) completed a sales
transaction with IMERYS USA, Inc. regarding the sale of Hecla's wholly owned
subsidiaries, Kentucky-Tennessee Clay Company, K-T Feldspar, K-T Mexico, and
other minor industrial minerals subsidiaries for a purchase price of $62.5
million, subject to customary post-closing adjustments.
The stock purchase agreement is attached hereto as Exhibit 99 and is
incorporated herein by reference.
Item 7. Financial Statements, Pro Forma Financial Information and Exhibits.
The following pro forma condensed consolidated financial statements of
Hecla Mining Company are filed as a part of this report:
(i) Pro forma Financial Introduction F-1
(ii) Pro forma Balance Sheet at December 31, 2000 F-2
(iii) Notes to Pro forma Balance Sheet F-3
(iv) Pro forma Statement of Operations for
the year ended December 31, 2000 F-4
(v) Notes to Pro forma Statements of Operations F-5
Exhibit 99 - Stock Purchase Agreement between Hecla Mining
Company and IMERYS USA, Inc. dated February 27, 2001.
SIGNATURE
Pursuant to the requirements of Section 12 of the Securities Exchange Act
of 1934, the Registrant has duly caused this report to be signed on its behalf
by the undersigned, thereunto duly authorized.
HECLA MINING COMPANY
By: /s/ Michael B. White
-------------------------------------
Name: Michael B. White
Title: Vice President - General Counsel
Dated: April 11, 2001
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EXHIBIT INDEX
Exhibit No. Title
___________ _____
Exhibit 99 - Stock Purchase Agreement between Hecla Mining Company and IMERYS
USA, Inc. dated February 27, 2001.
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PRO FORMA FINANCIAL INFORMATION
The following pro forma balance sheet as of December 31, 2000, and
statement of operations for the year ended December 31, 2000 (collectively, the
"Pro Forma Financial Statements"), were prepared by Hecla to illustrate the
estimated effects of the sale of K-T Clay, K-T Feldspar, K-T Mexico and other
minor industrial minerals companies, based on the historical financial
statements of Hecla and its subsidiaries under the assumptions and adjustments
set forth below and in the accompanying notes to the pro forma financial
statements. The Pro Forma Financial Statements include pro forma adjustments
which are based upon available information and certain assumptions that
management of Hecla believes are reasonable in the circumstances. The Pro
Forma Financial Statements give retrospective effect to Hecla's disposal of K-T
Clay, K-T Feldspar, K-T Mexico and other minor industrial minerals companies.
Effective March 27, 2001, Hecla sold all the stock of its wholly owned
subsidiaries K-T Clay, K-T Feldspar, K-T Mexico and other minor industrial
minerals companies, to IMERYS USA, Inc., for a purchase price of $62.5 million,
subject to customary post-closing adjustments. The disposition was effected
pursuant to a Purchase and Sale Agreement dated February 27, 2001, among IMERYS
USA, Inc., and Hecla. Hecla utilized the proceeds from the sale to repay its
$55.0 million term loan facility, which was due on April 10, 2001, and to repay
amounts outstanding under a $2.0 million revolving bank credit line.
The Pro Forma Financial Statements do not purport to represent what the
financial position or results of operations actually would have been if the
disposal of K-T Clay, K-T Feldspar, K-T Mexico and other minor industrial
minerals companies had occurred at the beginning of the period or to project the
financial position or results of operations for any future date or period.
The Pro Forma Financial Statements should be read in conjunction with the
historical consolidated financial statements, including the notes thereto, of
Hecla, which are included in Hecla's periodic filings on Form 10K and 10Q filed
with the U.S. Securities and Exchange Commission.
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Hecla Mining Company
Pro Forma Balance Sheet
As of December 31, 2000
(dollars in thousands)
(unaudited)
Pro Forma
Historical Adjustments Pro Forma
---------- ------------ ----------
ASSETS
Current assets:
Cash and cash equivalents $ 1,373 $ 60,125(1) $ 61,498
Accounts and notes receivable 11,164 - - 11,164
Inventories 11,269 - - 11,269
Other current assets 2,105 - - 2,105
Net assets of discontinued operations 44,057 (43,875)(1) 182
--------- --------- ---------
Total current assets 69,968 16,250 86,218
Investments 502 - - 502
Restricted investments 6,268 - - 6,268
Properties, plants and equipment, net 108,343 - - 108,343
Other noncurrent assets 9,755 - - 9,755
--------- --------- ---------
Total assets $ 194,836 $ 16,250 $ 211,086
========= ========= =========
LIABILITIES
Current liabilities:
Accounts payable and accred expenses $ 7,520 $ - - $ 7,520
Accrued payroll and related benefits 4,732 - - 4,732
Preferred stock dividend payable - - - - - -
Current portion of long-term debt 59,274 - - 59,274
Accrued taxes 2,188 - - 2,188
Current portion of accrued reclamation
and closure costs 12,060 - - 12,060
--------- --------- ---------
Total current liabilities 85,774 - - 85,774
Deferred income taxes 300 - - 300
Long-term debt 10,041 - - 10,041
Accrued reclamation and closure costs 46,650 - - 46,650
Other noncurrent liabilities 7,326 - - 7,326
--------- --------- ---------
Total liabilities 150,091 - - 150,091
--------- --------- ---------
SHAREHOLDERS' EQUITY
Preferred stock 575 - - 575
Common stock 16,715 - - 16,715
Capital surplus 400,236 - - 400,236
Accumulated deficit (366,523) 11,352(1) (355,171)
Accumulated other comprehensive loss (4,858) 4,898(1) 40
Stock held by grantor trust (514) - - (514)
Treasury stock (886) - - (886)
--------- --------- ---------
Total shareholders' equity 44,745 16,250 60,995
--------- --------- ---------
Total liabilities and shareholders' equity $ 194,836 $ 16,250 $ 211,086
========= ========= =========
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NOTES TO PRO FORMA BALANCE SHEET
(1) The pro forma adjustments reflect the sale of Hecla's wholly owned
subsidiaries K-T Clay, K-T Feldspar, K-T Mexico and other minor industrial
minerals companies. On March 27, 2001, Hecla completed a sales transaction
for the K-T Clay division for $62.5 million, subject to customary
post-closing adjustments. Hecla utilized a portion of the proceeds to
repay a $55.0 million term loan facility, as well as a $2.0 million
revolving bank credit line. However, the repayment of these credit
facilities was not required by the sales transaction and therefore, the
debt reduction has not been reflected as a pro forma adjustment.
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Hecla Mining Company
Pro Forma Statement of Operations
For the Year Ended December 31, 2000
(dollars and shares in thousands, except per share amounts)
(unaudited)
Pro Forma
Historical Adjustments Pro Forma
---------- ----------- ----------
Continuing operations:
Sales of products $ 75,850 $ - - $ 75,850
--------- --------- ---------
Cost of sales and other direct production costs 63,088 - - 63,088
Depreciation, depletion and amortization 18,091 - - 18,091
--------- --------- ---------
81,179 - - 81,179
--------- --------- ---------
Gross loss (5,329) - - (5,329)
--------- --------- ---------
Other operating expenses:
General and administrative 7,303 - - 7,303
Exploration 6,332 - - 6,332
Depreciation and amortization 282 - - 282
Provision for closed operations and
environmental matters 20,029 - - 20,029
Reduction in carrying value of
mining properties 40,240 - - 40,240
--------- --------- ---------
74,186 - - 74,186
--------- --------- ---------
Loss from operations (79,515) - - (79,515)
--------- --------- ---------
Other income (expense):
Interest and other income 4,609 - - 4,609
Miscellaneous expense (1,809) - - (1,809)
Interest expense (8,119) - -(1) (8,119)
--------- --------- ---------
(5,319) - - (5,319)
--------- --------- ---------
Loss before income taxes, discontinued operations
and extraordinary charge (84,834) - - (84,834)
Income tax provision (13) - - (13)
--------- --------- ---------
Loss before discontinued operations and
and extraordinary charge (84,847) - - (84,847)
Gain on disposal of discontinued operations - - 11,907(2) 11,907
--------- --------- ---------
Net loss (84,847) 11,907 (72,940)
Preferred dividends (8,050) - - (8,050)
--------- --------- ---------
Loss applicable to common shareholders $ (92,897) $ 11,907 $ (80,990)
========= ========= =========
Basic and diluted loss per common share before
discontinued operations and extraordinary charge $ (1.39) $ (1.39)
Gain on disposal of discontinued operations - - 0.18
--------- ---------
Basic and diluted loss per common share $ (1.39) $ (1.21)
========= =========
Weighted average number of common
shares outstanding 66,791 66,791
========= =========
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NOTES TO PRO FORMA STATEMENTS OF OPERATIONS
(1) The Company used the proceeds of the sale to pay off $57.0 million of
outstanding debt. However, the debt repayment was not required by the
sales transaction and therefore has not been reflected as a pro forma
adjustment. If the debt was repaid on January 1, 2000, interest expense
for the year ended December 31, 2000, would have been reduced by $6.3
million or $0.09 per share.
(2) Reflects the pro forma gain recognized on the sale of K-T Clay, K-T
Feldspar, K-T Mexico and other minor industrial mineral companies, assuming
the transaction was completed on January 1, 2000. Due to the anticipated
utilization of net operating losses, no income taxes have been provided for
the pro forma gain.
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