UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
Date of report (Date of earliest event reported): October 27, 2009
Coeur d’Alene Mines Corporation
(Exact name of registrant as specified in its charter)
IDAHO
(State or other jurisdiction
of incorporation or organization)
1-8641
(Commission File Number)
82-0109423
(IRS Employer Identification No.)
505 Front Ave., P.O. Box “I”
Coeur d’Alene, Idaho, 83816
(Address of Principal Executive Offices)
(208) 667-3511
(Registrant’s telephone number, including area code)
N/A
(Former Name or Former Address, if Changed Since Last Report)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the
filing obligation of the registrant under any of the following provisions (see General Instructions
A.2 below):
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Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
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Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
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Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR
240.14d-2(b)) |
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Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange
Act (17 CFR 240.13e-4(c)) |
Item 1.01 Entry into a Material Definitive Agreement
On October 27, 2009, Coeur Alaska Inc. (the “Borrower”), a wholly-owned subsidiary of Coeur
d’Alene Mines Corporation (the “Company”), entered into a $45.0 million secured term facility
agreement (the “Credit Facility”) with Credit Suisse as arranger, security agent, facility agent
and hedge provider, and the lender party thereto. The Credit Facility has a five-year term.
Amounts may be borrowed under the Credit Facility to finance remaining construction at the
Company’s Kensington mine located north of Juneau, Alaska. The Borrower’s obligations under the
Credit Facility are secured by all of the Borrower’s assets and
the land mineral rights and infrastructure at the Kensington mine, as
well as a pledge of the shares of the Borrower owned by the Company and are guaranteed by the Company pursuant to two guarantee agreements also dated October
27, 2009 (the “Guarantees”).
Borrowings under the Credit Facility will bear interest at a rate equal to LIBOR plus 5.0% per
year.
Voluntary prepayments of the loans and voluntary reductions of the unutilized portion of the
commitments under the credit facility are permissible, subject to certain conditions pertaining to
minimum notice and minimum reduction amounts. In addition, voluntary prepayments and reductions
are subject to payment of customary break costs. The Credit Facility requires the Borrower to establish
accounts for loan disbursements, a debt service reserve, and project proceeds. The Borrower has
pledged each of these accounts to Credit Suisse under account pledge agreements. In addition,
pursuant to the Credit Facility, the Borrower has entered into a hedging arrangement with Credit
Suisse designed to reduce cash flow volatility in the event of fluctuations in the price of gold.
The Credit Facility contains affirmative and negative covenants that we believe are usual and
customary for secured project finance facilities, including financial covenants that the Borrower’s
debt to equity ratio shall not exceed 40% and that the ratio of project cash flow to debt service
shall be at least 125%. Project covenants include covenants as to progress reports, performance of
sales contracts, maintenance and management.
The negative covenants include limitations (each of which is subject to customary exceptions
for financings of this type) on the Borrower’s ability to grant liens, enter into mergers, pay
dividends or other distributions or incur additional debt.
The Credit Facility also contains customary events of default (subject to grace periods and
exceptions).
Under the Guarantees, the Company guarantees the Borrower’s liabilities under the Credit
Facility and provides separate guarantees of up to $65.7 million in capital expenditures related to
construction and $5.0 million in cost overruns.
Copies of the Credit Facility and the Guarantees are attached hereto as Exhibits 10.1, 10.2
and 10.3 and are incorporated herein by reference. The descriptions of the Credit Facility and the
Guarantees are summaries only and are qualified in their entirety by the terms of the Credit
Facility and the Guarantees.
Item 2.03 Creation of a Direct Financial Obligation or an Obligation under an Off-Balance Sheet Arrangement of a Registrant.
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