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ANNUAL REPORT PURSUANT TO SECTION 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the Fiscal Year Ended December 31, 2015

Hecla Mining Company

6500 North Mineral Drive, Suite 200

Coeur d'Alene, ID 83815-9408

(a)

/s/ Phillips S. Baker, Jr.

Date:

Phillips S. Baker, Jr., President, Chief

Executive Officer and Director

December 31,

2015

2014

Assets

Investments, at Fair Value

Money market fund

Mutual funds

Common stock of Hecla Mining Company, including money market funds of $23,524 and $25,693

Total Investments

Receivables

Employer contributions

Notes due from participants

Total Receivables

Net Assets Available for Benefits

Years ended December 31,

2015

2014

Investment Income

Interest income – money market

Dividend income

Net (depreciation) appreciation in fair value of investments

Total Investment (Loss) Income

Interest Income from Notes Due from Participants

Contributions

Participants

Employer matching

Rollovers

Other additions

Total Additions to Net Assets

Deductions

Distributions to participants

Net increase in net assets available for benefits

Net Assets Available for Benefits

Beginning of year

End of year

1. Summary of Accounting Policies

Basis of Accounting

The Hecla Mining Company Capital Accumulation Plan (“Plan”) financial statements are presented on the accrual basis of accounting in conformity with accounting principles generally accepted in the United States of America.

Investment Valuation and Income Recognition

Investments in mutual funds and money market funds are reported at quoted market value for the number of shares held by the Plan at year-end. The Hecla Mining Company common stock fund is valued through a combination of quoted market price of the stock, per the New York Stock Exchange, and the valuation of cash equivalents held in the Plan through the use of models or other valuation methodologies.

The Plan presents in the statement of changes in net assets available for benefits the net appreciation or depreciation in the fair value of its investments, which consists of the realized gains or losses and the unrealized appreciation or depreciation on those investments. Purchases and sales of securities are recorded on a trade-date basis. Interest income is recorded on the accrual basis. Dividends are recorded on the ex-dividend date.

Notes Due from Participants

Notes due from participants are valued at their unpaid principal balance plus accrued interest. The Plan considers all notes receivable from participants at the end of a calendar quarter, following a calendar quarter for which there is any outstanding payment due, as in default. Defaulted notes receivable from participants are deemed distributed and recorded as benefits paid to participants in the statements of changes in net assets available for benefit.

Payment of Benefits

Benefits are recorded when paid.

Use of Estimates

The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of net assets available for benefits and changes therein, and disclosures of contingent assets and liabilities. Actual results could differ materially from those estimates. 

Risks and Uncertainties

The Plan invests in funds that invest in a combination of stocks, bonds, fixed income securities and other investment securities. Investment securities are exposed to various risks, such as interest rate, market and credit. Due to the level of risk associated with certain investment securities and the level of uncertainty related to changes in the value of investment securities, it is at least reasonably possible that changes in risks in the near term would materially affect participants’ account balances and the amounts reported in the statements of net assets available for benefits and the statements of changes in net assets available for benefits.

The fair value of the Plan’s investment in Hecla Mining Company common stock fund amounted to $4,942,633 and $4,985,021 as of December 31, 2015 and 2014, respectively. Such investments represented 6.9% and 7.2% of the Plan’s total net assets available for Plan benefits as of December 31, 2015 and 2014, respectively. For risks and uncertainties regarding Hecla Mining Company, participants should refer to the December 31, 2015, Form 10-K of Hecla Mining Company filed with the Securities and Exchange Commission.

New Accounting Pronouncements

In May 2015, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2015-07, Disclosures for Investments in Certain Entities that Calculate Net Asset Value Per Share (or its Equivalent), which seeks to eliminate diversity in practice surrounding how investments measured at net asset value under the practical expedient with future redemption dates have been categorized in the fair value hierarchy. The standard is effective for annual periods beginning after December 15, 2016. Early adoption is permitted. Management has determined this ASU is not applicable to the Plan.

In July 2015, the FASB issued ASU 2015–12, Plan Accounting: Defined Benefit Pension Plans (Topic 960), Defined Contribution Pension Plans (Topic 962), and Health and Welfare Benefit Plans (Topic 965): Part (I) Fully Benefit–Responsive Investment Contracts, Part (II) Plan Investment Disclosures, Part (III) Measurement Date Practical Expedient. This three–part standard simplifies employee benefit plan reporting with respect to fully benefit-responsive investment contracts and plan investment disclosures, and provides for a measurement-date practical expedient. Parts I and II are effective for fiscal years beginning after December 15, 2015 and should be applied retrospectively, with early application permitted. Part III is effective for fiscal years beginning after December 15, 2015 and should be applied prospectively, with early application permitted.

Management has elected to adopt Part II early. Accordingly, the amendment was retrospectively applied resulting in plan investment disclosures for the years ended December 31, 2015 and 2014 which reflect the provisions of ASU 2015-12. Part I and Part III are not applicable to this Plan. 

2. Description of Plan

The following descriptions and disclosures about the Plan provide only general information. Participants should refer to the most recent version of the summary Plan description and the Plan document for a more complete description of its provisions.

General

The Plan is a defined contribution plan, which originally became effective on January 1, 1986. The Plan provides for incentive savings through investments, which qualify under the Internal Revenue Service of the United States of America (“IRS”) code section 401(a) for tax deferral status. The Plan is subject to the provisions of the Employee Retirement Income Security Act of 1974 (“ERISA”), as amended.

Eligible Employees

All salaried and substantially all non-union hourly employees of Hecla Mining Company (the “Company”), and its subsidiaries, who are residents of the United States are immediately eligible to enroll in the plan upon employment. Non-resident aliens that have no earned income from the Company within the U.S., hourly employees at the Company’s Lucky Friday Mine who are included in the United Steelworkers of America Local 5114, and employees engaged through lease arrangements are not allowed to participate in the Plan.

Contributions

The Plan allows eligible employees to contribute from 1% to 50% of their compensation. Employees who do not affirmatively specify their instructions with regard to participation in the Plan will automatically have 3% of their compensation reduced for contribution. Total pre-tax contributions may not exceed $18,000 or $17,500 for the years ended December 31, 2015 and 2014, respectively. Participants who have attained age 50 before the end of the Plan year are eligible to make catch-up contributions not to exceed $6,000 or $5,500 for the years ended December 31, 2015 and 2014, respectively. Contributions may be suspended at any time upon thirty days written notice by the participant, with reinstatement and changes in suspended contributions effective for the following payroll period. Participants may also contribute amounts to the Plan previously contributed to another qualified plan.

The Company makes matching contributions equal to 100% of deferred contributions, up to 6% of the participant’s compensation. Effective January 1, 2014, the Company restated the Plan to allow for payment of matching contributions to be made in shares of the Company’s common stock on a quarterly basis. Prior to this change, matching contributions were made in cash on a pay-period basis. Upon payment of matching contributions in common stock by the Company, the common stock is converted to shares of the Hecla Common Stock Fund in each eligible participant’s account having value equal to their matching contribution. The number of shares of the Company’s common stock paid for matching contributions and the conversion to shares of Hecla Common Stock Fund are each based on the closing prices on a day during the first week following the quarter end. The specific day used for each depends on the timing of processing. Upon receipt, participants may reallocate their investment in the Hecla Common Stock Fund into the other investment options offered by the Plan, subject to customary blackout restrictions as applicable. The Company made $3,492,986 and $3,204,679 of non-cash employer matching contributions during the years ended December 31, 2015 and 2014, respectively.

The Company may also make a discretionary profit sharing contribution for any plan year. For the years ended December 31, 2015 and 2014, the Company did not make any discretionary profit sharing contributions.

Participant Accounts

Individual accounts are maintained for each participant. Each participant’s account is credited with the participant’s contribution, employer’s matching contribution, earnings within the Plan and an allocation of the Company’s discretionary profit-sharing contribution, if any. Allocations of the Company’s contribution and plan earnings are based on participant account balances, as defined in the Plan document. The participant’s benefit is limited to the benefit that has accumulated in the participant’s account. Participants may direct the investment of their account balances into the investment options offered by the Plan. Currently the Plan offers twenty-two investment options for participants. Participants may elect to change the amounts invested in any one or all of the individual options at any time.

Vesting

Participant contributions and the Company’s matching and discretionary contributions are 100% vested at all times.

Payment of Benefits

Distributions are made upon termination of employment, death, disability or retirement. When terminated, participants receive a notice of options with regards to their account approximately 30 days from the date of termination. Participants or their beneficiaries receive payment of benefits as follows: (a) balances of less than $1,000 in cases in which the participant or beneficiary did not take alternative action are distributed as a cash payment, (b) balances of between $1,000 and $5,000 in cases in which the participant or beneficiary did not take alternative action are automatically rolled over into an IRA, or (c) balances greater than $5,000 may be kept in the Plan until a determined distribution date, rolled over, or distributed in installments, as opted by the participant or beneficiary. Withdrawals from the Plan may also be made upon circumstances of financial hardship or termination of the Plan, in accordance with provisions specified in the Plan. A participant’s contributions are suspended for six months after receipt of a withdrawal made upon circumstances of financial hardship.

Notes Due From Participants

Participants may borrow from their fund accounts a minimum of $1,000 up to a maximum equal to the lesser of (a) $50,000, minus the highest outstanding loan balance or balances, if any, the participant had at any one time during the one-year period ending immediately before the date of the new loan, or (b) 50% of their account balance. The loans are secured by the balance in the participant’s account and bear interest at a rate commensurate with prevailing rates as determined by the Plan administrator, which currently range from 4.25% to 5.5%. Principal and interest are repaid ratably through payroll deductions over periods ranging up to 5 years, unless the loan is for the purchase of the participant’s principal residence, in which case the Plan Administrator may permit a longer repayment term up to 15 years. Each participant may have up to, but no more than, two notes outstanding at any one time.

Administrative Expenses

Administrative expenses are paid from Plan assets.

3. Investments

All of the Plan’s assets are managed and held by Vanguard Fiduciary Trust Company, the Trustee, which operates under the direction of certain officers of the Company. Participants may invest in one or more of the various mutual funds, money market funds, and the Hecla Mining Company common stock fund sponsored by the Trustee.

4. Plan Termination

Although it has not expressed intent to do so, the Company has the right, under the Plan, to discontinue its contributions at any time and to terminate the Plan subject to the provisions of ERISA. All assets remaining in the Plan after payment of any expenses properly chargeable against the Plan shall be paid to participants in such a manner as the Plan Administrator shall determine.

5. Party-in-Interest Transactions

Certain Plan investments are shares of mutual funds managed by Vanguard Fiduciary Trust Company, the trustee, and therefore, these transactions qualify as party-in-interest transactions. Certain Plan investments are shares of Hecla Mining Company common stock; therefore, these transactions also qualify as party-in-interest transactions.

6. Income Tax Status

The Plan received a Determination Letter from the IRS dated March 31, 2008, informing it that the Plan and related trust is qualified and exempt under Section 401(a) of the Internal Revenue Code (IRC). The Plan has been amended since receiving the determination letter; however, management of the Company and the Plan Administrator believe the Plan is designed, and is currently being operated, in compliance with the applicable requirements of the IRC. Therefore, the Company and the Plan Administrator believe that the Plan is qualified, and the related trust is tax-exempt.

Accounting principles generally accepted in the United States of America require Plan management to evaluate tax positions taken by the Plan and recognize a tax liability if the Plan has taken an uncertain position that more likely than not would not be sustained upon examination by the IRS. The Plan Administrator has analyzed the tax positions taken by the Plan, and has concluded that as of December 31, 2015 and 2014, there are no uncertain positions taken or expected to be taken that would require recognition of a liability or disclosure in the financial statements. The Plan is subject to routine audits by taxing jurisdictions; however, there are currently no audits for any tax periods in progress. The Plan Administrator believes it is no longer subject to income tax examinations for years prior to the Plan year ended December 31, 2012.

7. Fair Value Measurement

The Plan utilizes a fair value hierarchy that gives the highest priority to unadjusted quoted prices in active markets for identical assets and liabilities (level 1 measurements) and the lowest priority to unobservable inputs (level 3 measurements). The three levels of the fair value hierarchy are described below:

Level 1: Unadjusted quoted prices in active markets that are accessible at the measurement date for identical, unrestricted net assets and liabilities;

Level 2: Quoted prices in markets that are not considered to be active or financial instruments for which all significant inputs are observable, either directly or indirectly;

Level 3: Prices or valuations that require inputs that are both significant to the fair value measurement and unobservable.

The following is a description of the valuation methodologies used for Plan assets, as well as the general classification of such items pursuant to the fair value hierarchy:

Money Market Fund—The fair values of the Money Market Funds are determined by the quoted share price on active markets as of the last day of the plan year and are included in Level 1 of the fair value hierarchy.

Mutual Funds—The fair values of the Mutual Funds are determined by the quoted share price on active markets as of the last day of the plan year and are included in Level 1 of the fair value hierarchy.

Common Stock of Hecla Mining Company, including Money Market Funds—The fair value of the Hecla Common Stock Fund is determined through a combination of the quoted share price on an active market for the common stock of Hecla Mining Company and the valuation of cash equivalents held in the fund through the use of models or other valuation methodologies. The Hecla Common Stock Fund is included in Level 2 of the fair value hierarchy.

There have been no changes in the methodology used at December 31, 2015 and 2014.

The tables below set forth the Plan’s assets that were accounted for at fair value as of December 31, 2015 and 2014, and the fair value calculation input hierarchy level that applies to each asset category.

Description

Balance at

December 31, 2015

Quoted prices in

active market for

identical assets

(Level 1)

Significant other

observable inputs

(Level 2)

Mutual Funds

Money Market Funds

Common Stock-Hecla Mining Company

Total

Description

Balance at

December 31, 2014

Quoted prices in

active market for

identical assets

(Level 1)

Significant other

observable inputs

(Level 2)

Mutual Funds

Money Market Funds

Common Stock-Hecla Mining Company

Total

 77-0664171

 004

5500

(c)

Description of Investment

(b)

Including Maturity Date,

(e)

Identity of Issuer, Borrower,

Rate of Interest, Collateral,

(d)

Current

(a)

Lessor or Similar Party

Par or Maturity Value

Cost**

Value

Artisan International Fund

Mutual fund consisting of 53,143 shares

**

$

1,524,138

American Funds Growth Fund of America

Mutual fund consisting of 59,369 shares

**

$

2,432,361

Third Avenue Small-Cap Value Fund

Mutual fund consisting of 27,354 shares

**

$

     512,888

*

Vanguard 500 Index Fund

Mutual fund consisting of 13,498 shares

**

$

2,544,100

*

Vanguard Growth and Income Fund

Mutual fund consisting of 77,050 shares

**

$

3,047,321

*

Vanguard Prime Money Market Fund

Cash equivalent at various int. rates averaging 0.01% in 2015

 **

$

4,510,335

*

Vanguard Strategic Equity Fund

Mutual fund consisting of 79,842 shares

**

$

2,259,533

*

Vanguard Total Bond Market Index Fund

Mutual fund consisting of 126,674 shares

**

$

1,347,812

*

Vanguard Target Retirement 2010 Fund

Mutual fund consisting of 17,182 shares

**

$

     427,481

*

Vanguard Target Retirement 2015 Fund

Mutual fund consisting of 264,400 shares

**

$

3,762,406

*

Vanguard Target Retirement 2020 Fund

Mutual fund consisting of 218,592 shares

**

$

5,934,780

*

Vanguard Target Retirement 2025 Fund

Mutual fund consisting of 714,622 shares

**

$

11,162,391

*

Vanguard Target Retirement 2030 Fund

Mutual fund consisting of 229,153 shares

**

$

6,352,127

*

Vanguard Target Retirement 2035 Fund

Mutual fund consisting of 367,257 shares

**

$

6,184,609

*

Vanguard Target Retirement 2040 Fund

Mutual fund consisting of 77,298 shares

**

$

2,199,131

*

Vanguard Target Retirement 2045 Fund

Mutual fund consisting of 190,118 shares

**

$

3,380,295

 77-0664171

 004

5500

(c)

Description of Investment

(b)

Including Maturity Date,

(e)

Identity of Issuer, Borrower,

Rate of Interest, Collateral,

(d)

Current

(a)

Lessor or Similar Party

Par or Maturity Value

Cost **

Value

*

Vanguard Target Retirement 2050 Fund

Mutual fund consisting of 115,135 shares

**

$

3,280,205

*

Vanguard Target Retirement 2055 Fund

Mutual fund consisting of 10,293 shares

**

$

317,337

*

Vanguard Target Retirement 2060 Fund

Mutual fund consisting of 4,895 shares

**

$

133,196

*

Vanguard Windsor II Fund

Mutual fund consisting of 30,609 shares

**

$

1,025,418

*

Vanguard Target Retirement Income

Mutual fund consisting of 114,330 shares

**

$

1,423,404

*

Hecla Mining Company Common Stock Fund

Common stock of the Company consisting of 2,615,150 shares, par value of $0.25

**

$

4,942,633

*

Notes due from Participants

272 loans from participants with interest rates ranging from 4.25% to 5.50% maturing through August 2030

**

$

2,121,838

*     Represents party-in-interest to the Plan

** The cost of participant directed investments is not required to be disclosed.