Vista Gold Corp. to Receive $2.4 Million for 50% of Awak Mas Royalty from Exercise of Option
April 30 2020 - 11:37AM
Vista Gold Corp. (NYSE American and TSX: VGZ) (“Vista” or the
“Company”) today announced that PT Masmindo Dwi Area (“PT
Masmindo”) provided the necessary notice to Vista to exercise the
option to cancel half of the Awak Mas net smelter return (“NSR”)
royalty in consideration of a $2.4 million cash payment to Vista by
May 8, 2020.
Vista holds an NSR royalty on the Awak Mas
project in Indonesia. During 2019, Vista and PT Masmindo amended
the original royalty agreement to allow PT Masmindo to make a $2.4
million payment to Vista by April 30, 2020 to cancel a 1% NSR on
the first 1,250,000 ounces produced at Awak Mas and a 1.25% NSR on
the next 1,250,000 ounces produced. The due date for this payment
was subsequently amended to May 8, 2020. On April 29, 2020, PT
Masmindo provided notice to Vista to exercise the option to cancel
the related 1% NSR and 1.25% NSR upon making a payment of $2.4
million, which the Company expects to receive by May 8, 2020. Upon
receipt of the $2.4 million payment, PT Masmindo will then have the
right to cancel the remaining 1% NSR and 1.25% NSR for an
additional payment of $2.5 million by April 30, 2021. If PT
Masmindo does not make the $2.4 million payment by May 8, 2020,
Vista will retain the full royalty interests and can pursue
alternative monetization strategies.
Frederick H. Earnest, President and Chief
Executive Officer of Vista, stated, “The notice provided by PT
Masmindo to cancel 50% of the Awak Mas NSR royalty is another
example of Vista’s priority to monetize non-core assets and to
maintain Vista’s financial stability. When received, the $2.4
million payment will strengthen Vista’s balance sheet and provide
an important source of working capital for the next twelve months.
Looking ahead, should PT Masmindo choose to exercise the remainder
of its option and cancel the other half of the Awak Mas NSR
royalty, Vista could expect to receive an additional $2.5 million
in twelve months.”
About Vista Gold Corp.
The Company is a gold project developer. The
Company’s principal asset is its flagship Mt Todd gold project in
Northern Territory, Australia. Mt Todd is the largest undeveloped
gold project in Australia and as presently designed, is expected to
be Australia’s 5th largest gold producer on an annual basis.
For further information, please contact the
Company at (720) 981-1185.
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 we expect or anticipate
will or may occur in the future, including the receipt of the $2.4
million cash payment to be made to Vista by May 8, 2020 by PT
Masmindo and any other future option payments for the Awak Mas
project 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: our
assumption that PT Masmindo will make the $2.4 million cash payment
when due; there are no changes to laws or regulations impacting
mine development or mining activities, our assumptions with respect
to the current economic conditions, the price of gold and current
market conditions. When used in this press release, the words
“expect,” “intend,” “believe,” “may,” “will,” “if,” “anticipate,”
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
the Company to be materially different from any future results,
performance or achievements expressed or implied by such
statements. Such factors include, among others, risks
relating to political and economic instability; changes to laws or
regulations impacting mine development or mining activities,
uncertainty regarding current economic conditions, the price of
gold and current market conditions; as well as those factors
discussed under the headings “Note Regarding Forward-Looking
Statements” and “Risk Factors” in the Company’s latest Annual
Report on Form 10-K as filed on February 26, 2020 and other
documents filed with the U.S. Securities and Exchange Commission
and Canadian securities regulatory authorities. 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. Except as required by law, we assume
no obligation to publicly update any forward-looking statements or
forward-looking information; whether as a result of new
information, future events or otherwise.
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