DENVER, Dec. 11, 2013 /PRNewswire/ -- Vista Gold
Corp. (TSX & NYSE MKT: VGZ) ("Vista" or the "Company")
today announced that it has signed a binding share purchase
agreement (the "Purchase Agreement") to convert its interest in the
Awak Mas gold project in Sulawesi, Indonesia (the "Awak Mas Project") into a net
smelter return royalty ("Royalty") on the project.
The Awak Mas Project is indirectly held through a wholly owned
subsidiary of the Company, Vista Gold (Barbados) Corp. ("Vista Barbados") and is the
subject of a 2009 joint venture agreement, as amended and assigned,
and a 2011 additional option agreement, as amended and assigned,
(together, the "Existing Agreements") each between Vista Barbados
and Awak Mas Holdings Pty Ltd. (the "Purchaser") (a wholly owned
subsidiary of One Asia Resources Corp. ("One Asia")). The
Existing Agreements provide the Purchaser with the option to
acquire an 80% interest in the Awak Mas Project by completing
certain activities. Additional information about the Existing
Agreements is available in the Company's annual report on Form 10-K
for the year ended December 31,
2012.
The Purchase Agreement announced today provides for the
termination of the Existing Agreements and the acquisition by the
Purchaser of 100% of the outstanding shares of Vista Barbados, the
entity that indirectly holds the Awak Mas Project. In
exchange, (a) the Purchaser will forego certain cash payments due
to have been paid by the Company had the Purchaser completed the
earn-in of its interest in the project, and (b) the Company will
receive the Royalty (2% on the first 1.25 million ounces of gold
production and 2.5% on the next 1.25 million ounces of gold
production from the Awak Mas Project).
The completion of the transaction is subject to a number of
conditions, including receipt of any required regulatory approvals,
and the transaction is expected to close on or about December 16, 2013.
Frederick H. Earnest, President
and Chief Executive Officer, said "We are pleased that One Asia has
demonstrated an ability to advance the Awak Mas Project, and to
operate effectively in Indonesia.
With One Asia poised to perfect their 80% earn-in at the Awak Mas
Project, Vista would have been required to reimburse One Asia for
certain expenses incurred over the course of the last four years
and begin to fund 20% of the ongoing project expenditures. As
a result of this new agreement with the Purchaser, and subject to
the successful development of the Awak Mas Project, Vista could
enjoy cash income with exposure to gold prices and project reserve
growth, if any, without committing any future capital. This is
consistent with our strategic objectives, which include reducing
our operating risk, improving our balance sheet and locking in
value for our shareholders."
About Vista Gold Corp.
Vista's principal assets include its flagship Mt. Todd gold project
in Northern Territory, Australia,
and a 24.9% holding in Midas Gold Corp. In addition to
non-core projects in Mexico,
Indonesia and California, Vista holds a royalty interest in
a project in Bolivia. For more information about our
projects, including technical studies and resource estimates,
please visit our website at www.vistagold.com.
Forward Looking Statements
This press release contains forward-looking statements within the
meaning of the U.S. Securities Act of 1933, as amended, and U.S.
Securities Exchange Act of 1934, as amended, and forward-looking
information within the meaning of Canadian securities laws. All
statements, other than statements of historical facts, included in
this press release that address activities, events or developments
that Vista expects or anticipates will or may occur in the future,
including such things as the completion of the transaction
announced in this press release, the anticipated closing date for
the transaction, future obligations of Vista under the Existing
Agreements, the successful development of the Awak Mas Project, the
receipt of any payments pursuant to the Royalty, the potential for
Vista to gain exposure to gold prices and project reserve growth at
the Awak Mas Project, Vista's ability to successfully reduce its
operating risk while preserving value for its shareholders and
other such matters are forward-looking statements and
forward-looking information. The material factors and assumptions
used to develop the forward-looking statements and forward-looking
information contained in this press release include the following:
approved business plans, anticipated and estimated costs and budget
expenditures to continue to optimize and advance the Company's core
assets, the perceived extent and duration of the current weakness
of gold equity securities and other such matters. When used
in this press release, the words "optimistic," "potential,"
"indicate," "expect," "intend," "hopes," "believe," "may," "will,"
"if," "anticipate," "would," "could," and similar expressions are
intended to identify forward-looking statements and forward-looking
information. These statements involve known and unknown
risks, uncertainties and other factors which may cause the actual
results, performance or achievements of Vista to be materially
different from any future results, performance or achievements
expressed or implied by such statements. Such factors
include, among others, uncertainty of resource estimates, estimates
of results based on such resource estimates; risks relating to
completing metallurgical testing; risks relating to cost increases
for capital and operating costs; risks related to the timing
and the ability to obtain approval of the environmental impact
statement and the necessary permits for the Mt. Todd gold project,
risks of shortages and fluctuating costs of equipment or supplies;
risks relating to fluctuations in the price of gold; the inherently
hazardous nature of mining-related activities; potential effects on
Vista's operations of environmental regulations in the countries in
which it operates; risks due to legal proceedings; risks relating
to political and economic instability in certain countries in which
it operates; as well as those factors discussed under the headings
"Note Regarding Forward-Looking Statements" and "Risk Factors" in
Vista's Annual Report Form 10-K as filed on March 14, 2013 and other documents filed with the
U.S. Securities and Exchange Commission and Canadian securities
regulatory authorities. Although Vista has attempted to
identify important factors that could cause actual results to
differ materially from those described in forward-looking
statements and forward-looking information, there may be other
factors that cause results not to be as anticipated, estimated or
intended. Except as required by law, Vista assumes no
obligation to publicly update any forward-looking statements or
forward-looking information; whether as a result of new
information, future events or otherwise.
For further information, please contact Connie Martinez at (720) 981-1185, or visit the
Company's website at www.vistagold.com.
SOURCE Vista Gold Corp.