EXHIBIT 10.3

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June 2, 2009

STRICTLY CONFIDENTIAL

Hecla Mining Company

6500 North Mineral Drive

Suite 200

Coeur d’Alene, ID 83815-9408

 

Attn: James A. Sabala

  Senior Vice President & Chief Financial Officer

Dear Mr. Sabala:

This letter (the “Agreement”) constitutes the agreement between Hecla Mining
Company (the “Company”) and Rodman & Renshaw, LLC (“Rodman”) that Rodman shall
serve as the exclusive placement agent (the “Services”) for the Company, on a
“best efforts” basis, in connection with the proposed offer and placement (the
“Offering”) by the Company of 17,391,302 shares (the “Shares”) of the Company’s
common stock, par value $0.25 per share (the “Common Stock”) and Series 4
warrants (the “Warrants”) to purchase up to 12,173,913 shares of Common Stock
(the “Warrant Shares”, and together with the Warrant and the Shares, the
“Securities”). The terms of the Offering and the Securities shall be mutually
agreed upon by the Company and the investors and nothing herein implies that
Rodman would have the power or authority to bind the Company or an obligation
for the Company to issue any Securities or complete the Offering. The Company
expressly acknowledges and agrees that Rodman’s obligations hereunder are on a
reasonable best efforts basis only and that the execution of this Agreement does
not constitute a commitment by Rodman to purchase the Securities and does not
ensure the successful placement of the Securities or any portion thereof or the
success of Rodman with respect to securing any other financing on behalf of the
Company.

A. Fees and Expenses. In connection with the Services described above, the
Company shall pay to Rodman the following compensation:

1. Placement Agent’s Fee. The Company shall pay to Rodman a cash placement fee
(the “Placement Agent’s Fee”) equal to 4% of the aggregate purchase price paid
by each purchaser (“Purchaser”) of Securities that are placed in the Offering.
The Placement Agent’s Fee shall be paid at the closing of the Offering (the
“Closing”) from the gross proceeds of the Securities sold.

2. [Reserved].

3. Expenses. In addition to any fees payable to Rodman hereunder, but only if an
Offering is consummated, the Company hereby agrees to reimburse Rodman for all
reasonable travel and other out-of-pocket expenses incurred in connection with
Rodman’s engagement, including the reasonable fees and expenses of Rodman’s
counsel. Such reimbursement shall be limited to $25,000 without prior written
approval by the Company and shall be paid at the Closing from the gross proceeds
of the Securities sold.

Rodman & Renshaw, LLC      1251 Avenue of the Americas, 20th Floor, New York, NY
10020

Tel: 212 356 0500      Fax: 212 581 5690      www.rodm.com      Member: FINRA,
SIPC

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B. Term and Termination of Engagement. The term (the “Term”) of Rodman’s
engagement will be for the period of 30 days, or, if sooner, until the
consummation of the Offering. The engagement may be terminated by either party
at any time upon 5 days’ prior written notice. Notwithstanding anything to the
contrary contained herein, the provisions concerning confidentiality,
indemnification, contribution and the Company’s obligations to pay fees and
reimburse expenses contained herein will survive any expiration or termination
of this Agreement.

C. Fee Tail. Reference is made to that certain engagement letter, dated
December 10, 2008 by and between the Company and Rodman (“December Engagement”).
Rodman hereby waives Section 1(A)(2)(C) of the December Engagement solely as it
relates only to this Offering and agrees that any fees payable on account of
Purchasers subject to the December Engagement shall be paid pursuant to Section
A(1) hereunder as it relates to this Offering. Any subsequent offerings by the
Company, other than this Offering, shall be first subject to Section 1(A)(2)(C)
of the December Engagement and then to this clause C. Rodman shall be entitled
to a Placement Agent’s Fee, calculated in the manner provided in Paragraph A,
with respect to any public or private offering or other financing or
capital-raising transaction of any kind (“Tail Financing”) to the extent that,
Rodman is not otherwise receiving a fee therefore and such financing or capital
is provided to the Company by investors whom Rodman had introduced, directly or
indirectly, to the Company during the Term and who invested in the Offering, if
such Tail Financing is consummated at any time within the 12-month period
following the expiration or termination of this Agreement (the “Tail Period”).

D. Use of Information. The Company will furnish Rodman such written information
as Rodman reasonably requests in connection with the performance of its services
hereunder. The Company understands, acknowledges and agrees that, in performing
its services hereunder, Rodman will use and rely entirely upon such information
as well as publicly available information regarding the Company and other
potential parties to an Offering and that Rodman does not assume responsibility
for independent verification of the accuracy or completeness of any information,
whether publicly available or otherwise furnished to it, concerning the Company
or otherwise relevant to an Offering, including, without limitation, any
financial information, forecasts or projections considered by Rodman in
connection with the provision of its services.

E. Confidentiality. In the event of the consummation or public announcement of
any Offering, Rodman shall have the right to disclose its participation in such
Offering, including, without limitation, the placement at its cost of
“tombstone” advertisements in financial and other newspapers and journals.
Rodman agrees not to use any confidential information concerning the Company
provided to Rodman by the Company for any purposes other than those contemplated
under this Agreement.

F. Securities Matters. The Company shall be responsible for any and all
compliance with the securities laws applicable to it, including Regulation D and
the Securities Act of 1933, as amended (the “Securities Act”), and Rule 506
promulgated thereunder, and unless otherwise agreed in writing, all state
securities (“blue sky”) laws. Rodman agrees to cooperate with counsel to the
Company in that regard.

G. Indemnity.

1. In connection with the Company’s engagement of Rodman as placement agent, the
Company hereby agrees, to the extent permitted by law, to indemnify and hold
harmless Rodman and its affiliates, and the respective controlling persons,
directors, officers, shareholders, agents and employees of any of the foregoing
(collectively the “Indemnified Persons”), from and against any and all claims,
actions, suits, proceedings (including those of shareholders), damages,
liabilities and expenses incurred by any of them (including the reasonable fees
and expenses of counsel), as incurred, (collectively a “Claim”),

 

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that are (A) related to or arise out of (i) any actions taken or omitted to be
taken (including any untrue statements made or any statements omitted to be
made) by the Company in connection with the Offering, or (ii) any actions taken
or omitted to be taken by any Indemnified Person in connection with the
Company’s engagement of Rodman in connection with the Offering, or (B) otherwise
relate to or arise out of Rodman’s activities on the Company’s behalf under
Rodman’s engagement in connection with the Offering, and the Company shall
reimburse any Indemnified Person for all reasonable expenses (including the
reasonable fees and expenses of counsel) as incurred by such Indemnified Person
in connection with investigating, preparing or defending any such claim, action,
suit or proceeding, in which any Indemnified Person is, or is threatened to be,
a party. The Company will not, however, be responsible for any Claim, that is
finally judicially determined to have resulted from the gross negligence or
willful misconduct of any person seeking indemnification for such Claim. The
Company further agrees that no Indemnified Person shall have any liability to
the Company for or in connection with the Company’s engagement of Rodman except
for any Claim incurred by the Company as a result of such Indemnified Person’s
gross negligence or willful misconduct.

2. The Company further agrees that it will not, without the prior written
consent of Rodman, which will not be unreasonably withheld, delayed or denied,
settle, compromise or consent to the entry of any judgment in any pending or
threatened Claim in respect of which indemnification may be sought hereunder
(whether or not any Indemnified Person is an actual or potential party to such
Claim), unless such settlement, compromise or consent includes an unconditional,
irrevocable release of each Indemnified Person from any and all liability
arising out of such Claim.

3. Promptly upon receipt by an Indemnified Person of notice of any complaint or
the assertion or institution of any Claim with respect to which indemnification
is being sought hereunder, such Indemnified Person shall notify the Company in
writing of such complaint or of such assertion or institution, but failure to so
notify the Company shall not relieve the Company from any obligation it may have
hereunder, except and only to the extent the Company is materially prejudiced or
disadvantaged thereby. If the Company so elects or is requested by such
Indemnified Person, the Company will assume the defense of such Claim, including
the employment of counsel reasonably satisfactory to such Indemnified Person and
the payment of the fees and expenses of such counsel. In the event, however,
that legal counsel to such Indemnified Person reasonably determines that having
common counsel would present such counsel with a conflict of interest or if the
defendant in, or target of, any such Claim, includes an Indemnified Person and
the Company, and legal counsel to such Indemnified Person reasonably concludes
that there may be legal defenses available to it or other Indemnified Persons
different from or in addition to those available to the Company, then such
Indemnified Person may employ its own separate counsel to represent or defend
him, her or it in any such Claim and the Company shall pay the reasonable fees
and expenses of such counsel. If the Company fails timely or diligently to
defend, contest, or otherwise protect against any Claim, the relevant
Indemnified Party shall have the right, but not the obligation, to defend,
contest, compromise, settle, assert crossclaims, or counterclaims or otherwise
protect against the same, and shall be indemnified hereunder by the Company
therefor, including without limitation, for the reasonable fees and expenses of
its counsel and all amounts paid as a result of such Claim or the compromise or
settlement thereof. In addition, with respect to any Claim in which the Company
assumes the defense, the Indemnified Person shall have the right to participate
in such Claim and to retain his, her or its own counsel therefor at his, her or
its own expense.

4. The Company and Rodman agree that if any indemnity sought by an Indemnified
Person hereunder is held by a court to be unavailable for any reason then
(whether or not Rodman is the Indemnified Person), the Company and Rodman shall
contribute to the Claim for which such indemnity is held unavailable in such
proportion as is appropriate to reflect the relative benefits to the Company, on
the one hand, and Rodman on the other, in connection with Rodman’s engagement
referred to above, subject to the limitation that in no event shall the amount
of Rodman’s contribution to such Claim exceed the

 

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amount of fees actually received by Rodman from the Company pursuant to Rodman’s
engagement. The Company hereby agrees that the relative benefits to the Company,
on the one hand, and Rodman on the other, with respect to Rodman’s engagement
shall be deemed to be in the same proportion as (a) the total value paid or
proposed to be paid or received by the Company or its stockholders as the case
may be, pursuant to the Offering (whether or not consummated) for which Rodman
is engaged to render services bears to (b) the fee paid or proposed to be paid
to Rodman in connection with such engagement.

5. The Company’s indemnity, reimbursement and contribution obligations under
this Agreement (a) shall be in addition to, and shall in no way limit or
otherwise adversely affect any rights that any Indemnified Party may have at law
or at equity and (b) shall be effective whether or not the Company is at fault
in any way, provided that the Company will not be responsible for any claim that
is finally, judicially determined to have resulted from the gross negligence or
willful misconduct of any person seeking indemnity, reimbursement or
contribution for such claim.

H. Limitation of Engagement to the Company. The Company acknowledges that Rodman
has been retained only by the Company, that Rodman is providing services
hereunder as an independent contractor (and not in any fiduciary or agency
capacity) and that the Company’s engagement of Rodman is not deemed to be on
behalf of, and is not intended to confer rights upon, any shareholder, owner or
partner of the Company or any other person not a party hereto as against Rodman
or any of its affiliates, or any of its or their respective officers, directors,
controlling persons (within the meaning of Section 15 of the Securities Act or
Section 20 of the Securities Exchange Act of 1934, as amended (the “Exchange
Act”)), employees or agents. Unless otherwise expressly agreed in writing by
Rodman, no one other than the Company is authorized to rely upon this Agreement
or any other statements or conduct of Rodman, and no one other than the Company
is intended to be a beneficiary of this Agreement. The Company acknowledges that
any recommendation or advice, written or oral, given by Rodman to the Company in
connection with Rodman’s engagement is intended solely for the benefit and use
of the Company’s management and directors in considering a possible Offering,
and any such recommendation or advice is not on behalf of, and shall not confer
any rights or remedies upon, any other person or be used or relied upon for any
other purpose. Rodman shall not have the authority to make any commitment
binding on the Company. The Company, in its sole discretion, shall have the
right to reject any investor introduced to it by Rodman. The Company agrees that
it will perform and comply with the covenants and other obligations set forth in
the purchase agreement and related transaction documents between the Company and
the investors in the Offering, and that Rodman will be entitled to rely on the
representations, warranties, agreements and covenants of the Company contained
in such purchase agreement and related transaction documents as if such
representations, warranties, agreements and covenants were made directly to
Rodman by the Company.

I. Limitation of Rodman’s Liability to the Company. Rodman and the Company
further agree that neither Rodman nor any of its affiliates or any of its their
respective officers, directors, controlling persons (within the meaning of
Section 15 of the Securities Act or Section 20 of the Exchange Act), employees
or agents shall have any liability to the Company, its security holders or
creditors, or any person asserting claims on behalf of or in the right of the
Company (whether direct or indirect, in contract, tort, for an act of negligence
or otherwise) for any losses, fees, damages, liabilities, costs, expenses or
equitable relief arising out of or relating to this Agreement or the Services
rendered hereunder, except for losses, fees, damages, liabilities, costs or
expenses that arise out of or are based on any action of or failure to act by
Rodman or its affiliates or any of their respective officers, directors,
controlling persons (within the meaning of Section 15 of the Securities Act or
Section 20 of the Exchange Act), employees or agents that are finally judicially
determined to have resulted solely from the gross negligence or willful
misconduct of Rodman.

 

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J. Governing Law. This Agreement shall be governed by and construed in
accordance with the laws of the State of New York applicable to agreements made
and to be fully performed therein. Any disputes that arise under this Agreement,
even after the termination of this Agreement, will be heard only in the state or
federal courts located in the City of New York, State of New York. The parties
hereto expressly agree to submit themselves to the jurisdiction of the foregoing
courts in the City of New York, State of New York. The parties hereto expressly
waive any rights they may have to contest the jurisdiction, venue or authority
of any court sitting in the City and State of New York. In the event of the
bringing of any action, or suit by a party hereto against the other party
hereto, arising out of or relating to this Agreement, the party in whose favor
the final judgment or award shall be entered shall be entitled to have and
recover from the other party the costs and expenses incurred in connection
therewith, including its reasonable attorneys’ fees. Any rights to trial by jury
with respect to any such action, proceeding or suit are hereby waived by Rodman
and the Company.

K. Notices. All notices hereunder will be in writing and sent by certified mail,
hand delivery, overnight delivery or fax, if sent to Rodman, to the address set
forth on the first page hereof, fax number (646) 841-1640, Attention: General
Counsel, and if sent to the Company, to the address on the first page hereof,
fax number (208) 209-1285, Attention: James A. Sabala, Senior Vice President &
Chief Financial Officer. Notices sent by certified mail shall be deemed received
five days thereafter, notices sent by hand delivery or overnight delivery shall
be deemed received on the date of the relevant written record of receipt, and
notices delivered by fax shall be deemed received as of the date and time
printed thereon by the fax machine.

L. Miscellaneous. This Agreement shall not be modified or amended except in
writing signed by Rodman and the Company. This Agreement shall be binding upon
and inure to the benefit of both Rodman and the Company and their respective
assigns, successors, and legal representatives. This Agreement constitutes the
entire agreement of Rodman and the Company, and supersedes any prior agreements,
with respect to the subject matter hereof. If any provision of this Agreement is
determined to be invalid or unenforceable in any respect, such determination
will not affect such provision in any other respect, and the remainder of the
Agreement shall remain in full force and effect. This Agreement may be executed
in counterparts (including facsimile or .pdf counterparts), each of which shall
be deemed an original but all of which together shall constitute one and the
same instrument.

M. Rodman Representations. Rodman represents, warrants and agrees to and with
the Company that Rodman is registered or licensed with the Commission as a
broker-dealer and is a member of FINRA, and that all appropriate registrations,
licenses or filings have been made on its behalf in connection with its status
as a registered or licensed broker-dealer. Rodman agrees to maintain the
appropriate regulatory registrations and filings throughout the term of this
Agreement. Neither Rodman nor any of its principals or affiliates have been the
subject of any administrative, civil or criminal actions within the past five
(5) years preceding the date hereof that could be material to an investor’s
decision to purchase Shares.

 

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In acknowledgment that the foregoing correctly sets forth the understanding
reached by Rodman and the Company, please sign in the space provided below,
whereupon this letter shall constitute a binding Agreement as of the date
indicated above.

 

Very truly yours, RODMAN & RENSHAW, LLC By  

/s/ John Borer

Name:   John Borer Title:   Sr. Managing Director

 

Accepted and Agreed:

HECLA MINING COMPANY By  

/s/ James A. Sabala

Name:   James A. Sabala Title:   Senior Vice President and CFO

 

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