Hecla announces exchange for series B convertible preferreds

New York, Jan. 9 - Hecla Mining Co. said it plans an exchange offer for its series B cumulative convertible preferred stock.

The Coeur D'Alene, Ida. silver and gold miner said it will offer $66.00 in value of its common stock up to 8.25 shares for each share of series B preferreds.

Hecla said the $66.00 value represents a 12% premium to the preferreds' closing price of $59.00 on Friday and a 6% premium over the current redemption price for the preferreds.

If all 464,777 preferreds are exchanged, Hecla will issue 3.454 million common shares or 2.9% of the shares outstanding.

Hecla said it may redeem any preferreds not tendered in the exchange at their current redemption price of $62.25 a share.

"With the excellent performance of Hecla and its common stock, now is a great opportunity for our preferred shareholders to realize both the face value of the preferred plus the past unpaid dividends, and participate in any future increase in the value of the common stock," said Phillips Baker, Hecla's chief executive officer, in a news release.

"Our common shareholders also benefit as this action eliminates the split capital structure and the impact of past and future dividends."

The exact number of common shares to be exchanged for each share of preferred stock will be determined by dividing $66.00 by the volume weighted average price for Hecla common stock on the New York Stock Exchange for the five trading days ending two trading days prior to the expiration date of the exchange offer, capped at 8.25 common shares.

The exchange will run for 20 business days from the time the offer document is mailed to preferred shareholders, expected in the next few days.

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