History
Klondex built up its Nevada gold operations, funded by bank debt and a small share issue, before Hecla Mining bought it in July 2018.
2015-2017: Listing and the Hollister reserve
The record for Klondex Mines is quiet in its early years. In October 2015 the New York Stock Exchange certified its securities for listing, clearing them to begin trading. The next major step came in 2017. On March 31, Klondex and Investec Bank PLC amended a $35.0 million secured revolving credit facility first set up in March 2016. Its maturity moved from March 23, 2018 to December 31, 2019, and the reserve and resource levels Klondex had to maintain were changed.
In July 2017 Klondex reported an initial reserve at Hollister, a property it had acquired in October 2016. As of May 31, 2017, it stood at 116.1 thousand gold-equivalent ounces, split between the Hollister Main zone and the Gloria zone. Management said this supported 2017 production guidance of 30,000 to 35,000 gold-equivalent ounces. A drill program of about 20,000 feet had also started at Hatter Graben, aiming for an inferred resource (a lower-confidence estimate) by year-end or early 2018, depending on drill pad permits.
2017-2018: Bison and a larger credit line
On October 19, 2017 Klondex completed its acquisition of Bison Gold Resources Inc., which became a wholly owned subsidiary. It paid about $7.0 million (CDN$8.8 million) by issuing 1,956,126 shares, about 1.1% of those outstanding. That fits with the rise in shares on issue from 175,251,538 at the end of 2016 to 179,614,947 at the end of 2017, though the records do not explain the whole increase.
Borrowing grew too. A December 2017 amendment lifted the Investec revolver from $35 million to $40 million, and on February 13, 2018 a $5 million inventory draw took it to $45 million. Klondex also said its February 2014 gold purchase agreement with Franco-Nevada GLW Holdings Corp. was terminated because the parties had completed their obligations.
2018: Sale to Hecla
On March 16, 2018 Klondex agreed to be acquired by Hecla Mining Company. Shareholders were offered US$2.71 per share: US$2.47 in cash, Hecla shares or a mix, plus US$0.24 in shares of a new company, Havilah Mining Corporation, holding Klondex's Canadian assets (0.125 of a Havilah share per Klondex share). A US$21 million termination fee could be owed by either side in certain circumstances.
A proxy statement in May showed 180,179,588 shares outstanding at May 16, and said directors, officers and two institutional holders with 23.60% of shares had agreed to vote in favour. The board unanimously recommended the deal, which needed two-thirds of votes cast and court approval, for a July 12 meeting in Toronto.
Hecla completed the acquisition on July 20, 2018. Klondex shares became cash and/or Hecla shares plus Havilah shares, and all directors and named senior officers resigned. NYSE American trading stopped on July 23, and on August 2 Klondex terminated the registration of a class of its securities, ending its reporting obligation for them. As of the latest filings, it was a wholly owned Hecla subsidiary holding its Nevada assets, including Fire Creek, Hollister, Midas and Aurora. Treatment of the Investec revolver after closing was not stated.
Written from the 11 story beats below (2015 to 2 Aug 2018), which come from the company's own announcements and filings.