ITEM
2
. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS.
The following discussion and analysis should be read in conjunction with our
unaudited condensed
consolidated financial statements for the three
and six
months
ended
June 30
, 2014
, and the related notes thereto, which have been prepared in accordance with generally accepted accounting pr
inciples in the United States (“U.S. GAAP”
). This discussion and analysis contains forward-looking statements
and forward-looking information
that involve risks, uncertainties and assumptions. Our actual results may differ materially from those anticipated in these forward-looking stateme
nts
and information
as a result of many factors.
See section heading “
Note Regar
ding Forward-Looking Statements”
below
.
All dollar amounts stated herein are in U.S. dollars in thousands, except per share amounts, per warrant amounts, per ounce amounts, gold price per ounce amounts, and exchange rates unless specified otherwise.
References to C$ refer to Canadian currency
, A$ to Australian currency and $ to United States c
urrenc
y.
Overview
Vista Gold Corp. and its subsidiaries (collectively, “Vista,” the “Company,” “we,” “our,” or “us”)
are engaged
in the gold mining industry. We are focused on the evaluation, acquisition, exploration and advancement of gold exploration and potential development projects, which may lead to gold production or value adding strategic transactions such as earn-in right agreements, option agreements
,
leases to third parties, joint venture arrangements with other mining companies, or outright sales of assets for cash and/or other consideration. We look for opportunities to improve the value of our gold projects through exploration drilling and/or technical studies focused on optimizing previous engineer
ing work.
Our principal asset
is
our flagship
Mt Todd
gold project in North
ern Territory (“NT”), Australia
.
We also hold
11.2%
of
the outstanding common shares in the capital of
Midas Gold Corp (“Midas Gold Shares”) and
non-core projects in Mexico and
the United States
and
royalty interests in projects in Bolivia and Indonesia.
Outlook
We do not currently generate operating cash flows. Our sources of financing in the past have been the issuance of our common shares,
debt financing,
sale of Midas Gold Shares
,
and the
sale of non-core assets. The prices for gold equities, particularly those with early stage projects, have decreased steadily during the past year, and capital raising has
become more difficult for mining companies which do not have producing assets. Consequently, raising sufficient amounts of capital on reasonable terms has become increasingly difficult. These conditions are expected to continue for the foreseeable future, and could affect our ability to raise sufficient capital on reasonable terms, if at all. We are committed to ensuring that the Company remains liquid and we will continue to identify and to execute meaningful cost cutting initiatives. The Company will continue to seek other financing with priority given to non-dilutive sources such as the sale of our used mill equipment and monetization of other non-core assets. However, there can be no assurance that we will be able to timely monetize
our
non-core assets at a value acceptable to us or at all.
Results from Operations
Summary
For the
three
and six
months
ended
June 30
, 2014
,
we
focused
principally
on water management and related activities and
on
advancing the permitting process at
our
Mt Todd
gold project in NT, Australia. In addition to completing
a pre
-feasibility study and submitting
a final environmental impact statement
in the first half of 2013, in the second half of
2013 we introduced a range of cost
cutting measures including the elimination of discretionary spending, downsizing the Company and voluntary reductions to cash compensation for senior management
and for directors of the Company
.
Consolidated net loss for the
three months
ended
June 30
, 2014
and 2013
was $
2,919
and $
21,015
or $
0.
04
and $0.
26
per share, respectively.
Consolidated net loss for the six months ended June 30, 2014 and 2013 was $
4,059
and $48,421 or $0.
05
and $0.59
per share, respectively.
The principal components of these year-over-year changes are discussed below.
Exploration, property evaluation and holding costs
Exploration, property evaluation and holding costs were $
1,003
and $
5,877
during the
three months
ended
June 30
, 2014 and 2013
, respectively
, and $
2,421
and $13,007 during the six months ended June 30, 2014 and 2013, respectively
.
The lower 2014
costs were in part due to the cost reductions introduced through 2013. In addition, several capital intensive activities, including the
preparation of the
Mt Todd gold project pre-feasibility study and
related activities,
completion and submission of a final environmental impact statement
and water treatment and discharge from the existing open pit were completed in early 2013.
Corporate administration
Corporate administration costs were $
1,088
, and $
1,225
during the
three months ended
June 30
, 2014 and 2013
, respectively
, and $
2,363
, and $3,135 during the six months ended June 30, 2014 and 2013, respectively
.
The decrease in 2014
was primarily attributable to cost cutting initiatives
introduced through 2013
.
Non-operating income and expenses
Unrealized Gain
/(Loss)
on
Other
Investment
s
Unrealized gain/(l
oss) on other investments was
$
(632)
and $
(
18,541
)
for the
three months ended
June 30
, 2014 and 2013
, respectively
, and $
1,422
and $(47,322) for the
six
months ended June 30, 2014 and 2013, respectively
. These amounts are substantially the result of changes in fair value of our
Midas Gold Shares
.
The Company also holds approximately half the number of Midas Gold Shares in 2014 compared to 2013.
Deferred Income Tax
Benefit/(
Expense
)
Normal market changes
in the fair value of our
Midas Gold Shares
result in fluctuations in the deferred income tax benefit/(expense).
The
2014
deferred tax liability related
to the
unrealized gain arising from the change in the fair value of our Midas Gold Shares was offset by
our deferred tax assets associated with our net operating losses
in the U.S. net of a valuation allowance
.
The
three and six months ended June 30,
2013
deferred income tax benefit of
$
4,411 and $15,374, respectively,
was
principally related to the unrealized loss arising from the change in fair value of our
Midas Gold Shares
.
Financial Position, Liquidity and Capital Resources
Operating Activities
Net cash used in operating activities was
$4,212
and $
16,495
for the
six
months ended
June 30
, 2014 and 2013
, respectively. The decrease is primarily the result of changes in operating expenses as discussed
in
“Results of Operations
” above
and is consistent with our
prior disclosures
.
Investing Activities
Net cash
provided by investing activities of $
10,792
for the
six
months ended
June 30
, 2014
was
mainly
due to
the sale of 16,000,000 Midas Gold Share
s for gross proceeds of $11,640
. Net cash
used in
investing activities
of
$
2,
124
for the
six
months ended
June 30
, 2013
was primarily due to
additions
to plant and equipment of $2,
206
at our
Mt Todd
gold project.
Financing Activities
Net cash
used in
financing activities was
$
6,344
for
the
six
months ended
June 30
, 2014
was
primarily a result of
the
repayment of the
loan facility entered into in 2013 (the “2013 Facility”).
Net cash provided by financing activities was $
9,637
for the
six
months ended
June 30
, 2013
was
primarily
due to the draw-down
2013 Facility
.
Liquidity and Capital Resources
At
June 30
, 2014
, we had working capital of $
14,234
compared with working capital of $
8,622
at December 31, 201
3
, representing a
n
in
crease of $
5,612
. Our working
capital
increased
primarily due to the reclassification of our
Midas Gold Shares
to current assets from
non-
current assets
and
receipt of proceeds from
the sale of 16,000,000 Midas Gold Shares during the period, offset by
the use of cash to fund operations
and to repay debt
.
Included in the
June 30
, 2014, $
14,234
working capital amount is $
5,711
of cash and cash equivalents.
Included in the December 31, 2013, $8,622 working capital amount is $5,475 of cash and cash equivalents.
During October 2013, Vista and
Invecture Group, S.A. de C.V.
and RPG Structured Finance S.a.R.L. (
together,
the “Purchasers”)
entered into agreements whereby Vista agreed to sell 100% of its debt and equity interests in the Los Cardones gold project
located in Baja California Sur, Mexico
(
“
Los Cardones Sale”) to
the Purchasers
for a total of $13,000, $7,000 of which was paid in October 2013
and $6,000
of which
was
payable January 2014
(the Subsequent Payment”)
subject to the Purchasers’ option to elect to not make this payment
(
see Note 5 to the unaudited condensed consolidated financial statements
).
In 2014, we extended the due
for the Subsequent Payment
to July 2014 and subsequently
to
January 2015
for additional consideration of $
500
which
we expect to receive on or about August 1, 2014
(
see Note 13 to the unaudited condensed consolidated financial statements
)
. If the Purchaser does not make the
Subsequent P
ay
ment, Vista will retain
all amounts
already received and 100% of the Los Cardones gold project will be returned to Vista.
Pursuant to the terms of Vista’s 2013 Facility, Vista repaid C$3,041 ($2,960) of the 2013
Facility using proceeds from the Los Cardones Sale.
During February 2014, we completed the sale of 16,000,000
Midas Gold Shares
held by our subsidiary Vista Gold U.S. Inc. for gross proceeds of C$12,800 ($11,640).
In the past year, capital raising has become more difficult for junior mining companies which do not have producing assets and these conditions are expected to continue for the foreseeable future. Consequently, we may not be able to raise capital in sufficient amounts on reasonable terms, if at all.
Management is strongly committed to careful cash management and maintaining liquidity. The Company’s cash burn rate has been dramatically reduced since 2013 as several cash intensive programs
at the Mt Todd gold project
such as water treatment and preparation of the preliminary feasibility
study
have been completed. In addition, several significant cost cutting measures have been introduced including a reduction of management positions, significant reductions in cash compensation for executives, senior management and the Company’s Board of Directors, and the delay or elimination of
discretionary
programs, including exploration activities. Other aggressive cost cutting measures, particularly at
the
Mt Todd
gold project
, are being pursued.
In addition, the Company is advancing discussions with the government of the Northern Territory of Australia aimed at establishing a mechanism for sharing the ongoing costs of water management and the associated environmental monitoring at the Mt Todd gold project.
The Company’s cash burn rate is expected to average
less than
$2,000 per quarter through
the remainder of
2014
, assuming a normal
start to the 2014-2015
wet season in the
NT
.
Subject to this assumption, the Company believes that it can susta
in this burn rate
through 2015
, if necessary.
The Company will need additional financing to meet these costs in 2015 and hopes to receive $850 in two installments over the next seven months pursuant to the Guadalupe de los Reyes gold/silver project Option Agreement with Cangold Limited (see Note 5 to the unaudited
condensed
consolidated financial statements).
The Co
mpany also hopes to receive $6,0
0
0 related to the 2013 sale of the Los Cardones gold project, subject to the Purchaser’s option to elect to not make this payment (see Note 5 to the unaudited
condensed
consolidated financial statements). In addition, the Company will
continue to seek additional financing with priority given to non-dilutive sources such as the sale of non-core assets, including our used mill equipment. However, there can be no assurance that the Company will receive any of these payments or timely monetize our non-core assets at a value acceptable to us or at all.
However, g
iven the Company’s ability to liquidate the other investments component of working capital in February 2015, if insufficient capital is available from all other sources, we believe that the Company’s other investments could provide access to sufficient funding
for us
to operate well into 2016.
The continuing operations of the Company are dependent upon our ability to secure sufficient funding and to generate future profits from operations. The underlying value and recoverability of the amounts shown as mineral properties, plant and equipment, assets held for sale, investments and other property interests in our
condensed
consolidated balance sheets are dependent on our ability to generate positive cash flow from operations and to continue to fund exploration and development activities that would lead to profitable production or proceeds from the disposition of these assets. There can be no assurance that we will be successful in disposing of these assets or securing additional funding on terms acceptable to us or at all
or
developing
profitable operations in the future
. Our
un
audited
condensed
consolidated financial statements do not include any adjustments relating to the recoverability and classification of recorded assets or liabilities which might be necessary should we not be able to continue as a going-concern.
Fair Value Accounting
The following table sets forth the Company’
s assets measured at fair value
on a recurring basis
by level within the fair value hierarchy. As required by accounting guidance, assets are classified in their entirety based on the lowest level of input that is significant to the fair value measurement.
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Fair value at June 30, 2014
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Total
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Level 1
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Level 3
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Assets:
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Cash equivalents
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$
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4,000
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$
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4,000
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$
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-
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Marketable securities
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205
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205
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-
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Other investments (Midas Gold Shares)
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11,852
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11,852
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-
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Mill equipment, held for sale
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6,500
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-
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6,500
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Fair value at December 31, 2013
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Total
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Level 1
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Level 3
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Assets:
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Cash equivalents
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$
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3,000
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$
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3,000
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$
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-
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Marketable securities
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176
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176
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-
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Other investments (Midas Gold Shares)
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20,990
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20,990
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-
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Mill equipment, held for sale
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6,500
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-
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6,500
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Our cash equivalent instruments, marketable securities and investment in
Midas Gold Shares
are classified as Level 1 of the fair value hierarchy as they are valued at quoted market prices in an active market
.
The Company incurred a Level 3 impairment loss on certain mill equip
ment (
see
Note 6
to the unaudited
condensed
consolidated financial statements
) for the year
ended December 31, 2013. This equipment was valued at
$6,500
at
December 31, 2013,
based on a third party assessment of the projected sale value
giving
full consideration to current market conditions and an orderly sale process. This valuation was used to determine the Level 3 impairment charge taken in 2013. The mill equipment is categorized as assets held for sale on the
Condensed
Consolidated Balance Sheets.
At
June 30
, 2014
, the assets classified within Level 3 of the fair value hierarchy
represent
29
% of
the total
assets measured at fair value
.
There
have been
no transfers between levels in
2014
nor have there been any changes in valuation techniques
.
As of June 30, 2014, the Company also had the Amayapampa interest, comprised of a right to receive an NSR royalty on future gold production, if any, plus certain additional cash payments if the project successfully
starts commercial production
. Under certain conditions, Amayapampa is subject to measurement at fair value on a non-recurring basis. Measurement at fair value in subsequent periods will be applicable if Amayapampa is determined to be impaired; however, no triggering events have occurred during the six months ended June 30, 2014. If an impairment of the Amayapampa interest becomes necessary, such fair value measurement will be determined utilizing Level 3 inputs.
Off-Balance Sheet Arrangements
We have no off-balance sheet arrangements required to be disclosed in this
quarterly report on Form 10-Q
.
Contractual Obligations
At
December 31,
2013, our contractual obligation
consist
s
of our
2013 Facility, discussed above,
and
such obligation is
recorded in our
Condensed
Consolidated Balance Sheet
s
.
The 2013 Facility was paid in full as of March 31, 2014.
Project Updates
Mt Todd
Gold Project, Northern Territory, Australia
The focus of
our
activities at the Mt Todd gold project in 2014 will be principally on acquiring the approval of the
environmental impact statement
, identifying and evaluating project optimi
zation opportunities, and care and
maintenance activities related to the mineral
licenses
and exploration licenses. The current gold price does not justify
completion of the feasibility study or
the developm
ent of the project at this time
.
However, we remain positioned, subject to a sustained improvement in gold prices, to move forward quickly with the completion of the Mt Todd gold project feasibility study. We estimate that the feasibility study could be completed within four months
of its commencement
and at a cost of approximately $2,500
.
We
continue to review and closely monitor
our
site holding costs and
are
working with the NT Government to identify and implement potential cost sharing opportunities with respect to the management of water on site and the associated environmental monitoring.
No exploration is planned on the
mining licenses
and only minimal field mapping is planned for the
exploration licenses
.
G
uadalupe de los Reyes Gold/Silver Project, Sinaloa, Mexico
During January 2014, we signed a non-binding letter of intent (the “LOI”) to option our interest in the Guadalupe de los Reyes gold/silver project in Sinaloa, Mexico to Cangold Limited (“Cangold”).
The LOI provided
that a non-refundable $50 payment be made to Vista for which Cangold
would
have a 90 day period of exclusivity to complete due diligence and negotiate and enter into a definitive option agreement with Vista (the “Option Agreement”).
During April 2014, the
Minera Gold Stake S.A. de C.V. (“MGS”), Vista’
s wholly-owned subsidiary
,
entered into
the
Option Agreement to option its interest in the Guadalupe de los Reyes gold/silver project in
Sinaloa, Mexico to Cangold.
Pursuant to the terms of the Option Agreement, Vista has granted Cangold the right to earn a 70% interest in the
Guadalupe de los Reyes gold/silver project
by:
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making payments totaling $5,000
in five payments over a three-year p
eriod, with payments totaling $1,000 in the first year ($150
o
f which was paid at signing), $1,500 in the second year and $2,500
in the third year;
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operating the
Guadalupe de los Reyes gold/silver project
and
maintaining the concessions comprising the
Guadalupe de los Reyes gold/silver project
in good standing; and
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fulfilling all o
f the obligations of MGS
to the Ejido La Tasajera (the “Ejido”) as set out in the temporary occupation contract between MGS and the Ejido.
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The Option Agreement provides that all cash payments are non-refundable and optional to Cangold, and in the event Cangold fails to pay any of the required amounts on the scheduled dates or fails to comply with its other obligations, the Option Agreement will terminate and Cangold will have no interest in the
Guadalupe de los Reyes gold/silver project
. Provided it is not in breach of the Option Agreement, Cangold may at its discretion advance the above payment schedule and exercise the initial option for a 70% interest in the
Guadalupe de los Reyes gold/silver project
any time during the three-year period.
Subject to Cangold earning a 70% interest in the
Guadalupe de los Reyes gold/silver project
,
MGS
has granted Cangold
the
option to earn the remaining 30% interest in the
Guadalupe de los Reyes gold/silver project
by notifying
MGS
of a production decision
no later than the tenth anniversary of exercising the first option
and by maki
ng a cash payment to MGS of $3,000
plus an additional cash payment based on a formula that includes the growth, if any, in estimated
measured and i
ndicated mineral resources of the
Guadalupe de los Reyes gold/silver project
, and the then prevailing spot gold price (“Escalator Payment”).
Should Cangold determine not to put the
Guadalupe de los Reyes gold/silver project
into production, the Option Agreement provides
MGS
with the right to buy back Cangold’s 70% interest in the
Guadalupe de los Reyes gold/silver project
for a cash payment of $5,000
plus the Escalator Payment described above. If
MGS
does not exercise its buyback option,
MGS
will still retain a right of first refusal should Cangold elect to sell its 70% interest in t
he
Guadalupe de los Reyes gold/silver project
to a third party
.
Los Cardones Gold Project
During October 2013, we and
the
Purchasers entered into agreements for the Los Cardones Sale to the Purchasers for a total of
$13,000
($7,000
of which was paid in October 2013
and
$6,000
of which
was
payable
January
2014
(the “Subsequent Payment”)
subject to the Purchasers’ option to elect to not make
t
he
Subsequent P
ayment
)
.
In January 2014, the due date for the Subsequent Payment was extended to July 31, 2014 for additional consideration of $250 payable on July 31, 2014. As a result of permitting delays, we and the Purchasers have
agreed to
an additional extension of
the due date
of the
Subsequent P
ayment
to January 30, 2015 (the “Second Extension”)
for
additional
consideration of $250
.
The Company expects to receive a cash payment of $500 comprising the First Extension
Consideration and the Second Extension Consideration
on or about August 1, 2014.
If the Purchasers elect to not make the
Subsequent Payment, we will retain the all payments
already received and 100% of the Los Cardones gold project will be returned to us
.
Cautionary Note to U.S. Investors Regarding Estimates of Measured, Indicated and Inferred Resources and Proven and Probable Reserves
The terms “mineral reserve”, “proven mineral reserve” and “probable mineral reserve” are Canadian mining terms as defined in accordance with
National Instrument 43-101 (“
NI 43-101
”)
and the Canadian Institute of Mining, Metallurgy and Petroleum (the “CIM”) –
CIM Definition Standards on Mineral Resources and Mineral Reserves
, adopted by the CIM Council, as amended (the “CIM Definition Standards”). These definitions differ from the definitions in SEC’s Industry Guide 7 (“SEC Industry Guide 7”) under the United States Securities Act of 1933, as amended (the “Securities Act”). Under SEC Industry Guide 7 standards, a “final” or “bankable” feasibility study is required to report reserves, the three-year historical average price is used in any reserve or cash flow analysis to designate reserves, and the primary environmental analysis or report must be filed with the appropriate governmental authority.
In addition, the terms “mineral resource”, “measured mineral resource”, “indicated mineral resource” and “inferred mineral resource” are defined in and required to be disclosed by NI 43-101; however, these terms are not defined terms under SEC Industry Guide 7 and are normally not permitted to be used in reports and registration statements filed with the SEC. Investors are cautioned not to assume that all or any part of a mineral deposit in these categories will ever be converted into reserves. “Inferred mineral resources” have a great amount of uncertainty as to their existence, and great uncertainty as to their economic and legal feasibility. It cannot be assumed that all, or any part, of an inferred mineral resource will ever be upgraded to a higher category. Under Canadian rules, estimates of inferred mineral resources may not form the basis of feasibility or pre-feasibility studies, except in rare cases. Investors are cautioned not to assume that all or any part of an inferred mineral resource exists or is economically or legally mineable. Disclosure of “contained ounces” in a resource is permitted disclosure under Canadian regulations; however, the SEC normally only permits issuers to report mineralization that does not constitute “reserves” by SEC standards as in place tonnage and grade without reference to unit measures.
Accordingly, information contained in this report on Form 10-Q contain
s
descriptions of our mineral deposits that may not be comparable to similar information made public by U.S. companies subject to the reporting and disclosure requirements under the United States federal securities laws and the rules and regulations thereunder.
Certain U.S. Federal Income Tax Considerations
Vista has been a “passive foreign investment company” (“PFIC”) as defined under Section 1297 of the U.S. Internal Revenue Code of 1986, as amended, in recent years and expects to continue to be a PFIC in the future. Current and prospective United States shareholders should consult their tax advisors as to the tax consequences of PFIC classification and the U.S. federal tax treatment of PFICs. Additional information on this matter is included in Vista’s Annual Report on Form 10-K for the year ended December 31, 2013, under “Part II. Item 5. Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities — Certain United States Federal Income Tax Considerations.”
Note Regarding Forward-Looking Statements
This Quarterly Report on Form 10-Q contains “forward-looking statements” within the meaning of the United States
Private Securities Litigation Reform Act of 1995
and “forward-looking information” under Canadian securities laws, that are intended to be covered by the safe harbor created by such legislation. All statements, other than statements of historical facts, included in this Quarterly Report that address activities, events or developments that the Company expects or anticipates will or may occur in the future are forward-looking statements and forward-looking information, including, but not limited to, such things as those listed below:
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the receipt by the Company of the
$
6,00
0 payment for the sale of the Los Cardones gold project;
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the potential monetization of our non-core assets, including our mill equipment which is held for sale;
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the receipt by the Company of the $
4,850 option
payments related to the Guadalupe de los Reyes gold/silver project
Option Agreement
;
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the Company’s ability to sustain its current cash burn rate through 2015;
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estimates of future operating and financial performance;
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t
he NT Government agreeing to sharing the cost of management of water and associated environmental monitor
ing at the Mt Todd gold project;
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potential funding requirements and sources of capital, including near-term sources of additional cash;
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our expectation that we will continue to raise capital through the sale of non-core assets
, equity and/or debt financings;
through the exercise of stock options and warrants;
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our expectation that the Company will continue to incur losses and will not pay dividends for the foreseeable future
;
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our estimates of our future cash position;
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our intention to identify and execute cost cutting initiatives;
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our expectation that raising capital for mining companies without producing assets will continue to be difficult for the foreseeable future, and the potential impact of this on our ability to raise capital in sufficient amounts on reasonable terms;
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our planned deferral of significant development commitments until market conditions improve;
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our potential ability to generate proceeds from operations or the disposition of our assets;
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the timing, performance and results of feasibility studies;
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plans and anticipated effects of
holding
11.2
%
Midas
Gold Shares
;
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our potential entry into agreements to find, lease, purchase, option or sell mineral interests;
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plans for evaluation and advancement of the
Mt Todd
gold project;
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our expectation of acquiring approval of the Mt Todd gold project environmental impact statement;
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our ability to raise sufficient capital to complete a feasibility study of the
Mt Todd
gold project;
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the feasibility of the
Mt Todd
gold project;
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future business strategy, competitive strengths, goals and expansion and growth of our business;
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plans and estimates concerning potential project development, including matters such as schedules, estimated completion dates and estimated capital and operating costs;
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estimates of mineral reserves and mineral resources;
and
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·
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our expectation that we will continue to be a
PFIC
in the future.
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Forward-looking statements and forward-looking information have been based upon our current business and operating plans, as approved by the Board; our cash and other funding requirements and timing and sources thereof; results of pre-feasibility and feasibility studies, mineral resource and reserve estimates, preliminary economic assessments and exploration activities; advancements of the Company’s required permitting processes; current market conditions and project development plans. The words “estimate,” “plan,” “anticipate,” “expect,” “intend,” “believe,” “will,” “may” and similar expressions are intended to identify forward-looking statements and forward-looking information. These statements involve known and unknown risks, uncertainties, assumptions and other factors which may cause our actual results, performance or achievements to be materially different from any results, performance or achievements expressed or implied by such forward-looking statements and forward-looking information. These factors include risks such as:
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our ability to raise additional capital on favorable terms, if at all;
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·
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pre-feasibility and feasibility study results and preliminary assessment results and the accuracy of estimates
and assumptions
on which they are based;
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·
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resource and reserve estimate results, the accuracy of such estimates and the accuracy of sampling and subsequent assays and geologic interpretations on which they are based;
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technical and operational feasibility and the economic viability of deposits;
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our ability to obtain, renew or maintain the necessary authorizations and permits for our business, including its development plans and operating activities;
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t
he NT Government not agreeing to and/or not implementing the sharing of costs of management of water and associated environmental monitor
ing at the Mt Todd gold project;
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·
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the timing and results of a feasibility study on the
Mt Todd
gold project;
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·
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delays in commencement of construction at the
Mt Todd
gold project;
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·
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our ability to secure the permits for the
Mt Todd
gold project including the environmental impact statement;
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·
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likelihood that we will receive
the
final $6,000
payment
from the Purchasers of
the Los Cardones gold project sale;
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·
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receiving the option payments related to the Guadalupe de los Reyes gold/silver project option agreement;
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·
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increased costs that affect
our operations or
our financial condition;
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·
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our reliance on third parties to fulfill their obligations under our agreements;
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whether projects not managed by us will comply with our standards or meet our objectives;
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a shortage of skilled labor, equipment and supplies;
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whether our acquisition, exploration and development activities, as well as the realization of the market value of our assets, will be commercially successful and whether any transactions we enter into will maximize the realization of the market value of our assets;
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trading price of our securities and our ability to raise funds in new share offerings due to future sales of common shares in the public or private market and our ability to raise funds from the exercise of our warrants;
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the lack of dividend payments by us;
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the success of future joint ventures, partnerships and other arrangements relating to our properties;
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the market price of the securities held by us;
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·
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our ability to timely monetize
Midas Gold Shares
;
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·
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our lack of production and experience in producing;
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·
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perception of environmental impact of the
Mt Todd
gold project;
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·
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reclamation liabilities, including reclamation requirements at the
Mt Todd
gold project;
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our history of losses from operations;
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future water supply issues at the
Mt Todd
gold project;
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environmental lawsuits;
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·
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lack of adequate insurance to cover potential liabilities;
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our ability to retain and hire key personnel;
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fluctuations in the price of gold;
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·
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inherent hazards of mining exploration, development and operating activities;
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·
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the accuracy of calculations of mineral reserves, mineral resources and mineralized material fluctuations therein based on metal prices, inherent vulnerability of the ore and recoverability of metal in the mining process;
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changes in environmental regulations to which our exploration and development operations are subject;
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changes in climate change regulations;
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changes in corporate governance and public disclosure regulations;
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intense competition in the mining industry;
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conflicts of interest of some of our directors as a result of their involvement with other natural resource companies;
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potential challenges to the title to our mineral properties;
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political and economic instability in Mexico;
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fluctuation in foreign currency values; and
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our likely status as a PFIC for U.S. federal tax purposes.
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For a more detailed discussion of such risks and other important factors that could cause actual results to differ materially from those in such forward-looking statements and forward-looking information, please see the risk factors contained in our Annual Report on Form 10-K for the year ended December 31, 2013, under “Part I-Item 1A. Risk Factors” and “Part II-Item 2. Risk Factors” below.
Although we have 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. There can be no assurance that these statements will prove to be accurate as actual results and future events could differ materially from those anticipated in the statements. Except as required by law, we assume no obligation to publicly update any forward-looking statements and forward-looking information, whether as a result of new information, future events or otherwise.