The following discussion and analysis should be read in conjunction with our unaudited condensed consolidated financial statements for the three and six months endedJune 30, 2022 , and the related notes thereto, which have been prepared in accordance with generally accepted accounting principles inthe United States . 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 statements and information as a result of many factors. See section heading "Note Regarding Forward-Looking Statements" below.
All dollar amounts are in
Overview
Vista Gold Corp. and its subsidiaries (collectively, "Vista," the "Company," "we," "our," or "us") operate in the gold mining industry. We are focused on 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 engineering work. We do not currently generate cash flows from mining operations. The Company's flagship asset is its 100% owned Mt Todd gold project ("Mt Todd" or the "Project") inNorthern Territory, Australia (the "NT"). Mt Todd is one of the largest and most advanced undeveloped gold projects inAustralia . With the approval of the Mining Management Plan ("MMP") inJune 2021 , all major operating and environmental permits for Mt Todd have been received. Since acquiring Mt Todd in 2006, we have invested substantial financial resources to systematically explore, evaluate, engineer, permit and de-risk the Project. InFebruary 2022 , we completed a feasibility study in respect of Mt Todd (the "2022 FS"). We believe this work has added substantial value to the Project and positions the Project for near-term development. InMarch 2022 , we appointedCIBC Capital Markets as our strategic advisor to assist us in evaluating a broad range of alternatives to unlock the value of Mt Todd. The 2022 FS highlights a 19% increase in gold reserves from 5.85 million ounces, as reported in the Company's amended 2019 pre-feasibility study, to 6.98 million ounces, supporting a 16-year operation with average annual production of 479,000 ounces of gold during the first seven years of commercial operations and a low operating cost profile that delivers significant cash flows over the life of the mine. See "Mineral Resources and Mineral Reserves Estimates" below for additional information. The 2022 FS reflects the inflationary trends faced by all operators and developers in the mining industry through the middle of Q4 2021. While the long-term effect of the current inflationary trend is unknown, management believes the resilience of Mt Todd, in part supported by the positive impact of the current foreign exchange rate, is demonstrated by the project economics reflected in the 2022 FS. Mt Todd's economic returns, when compared to those of the 2019 pre-feasibility study, benefit from the increase in the gold reserve estimate, favorable results of the power plant trade-off study and slightly lower energy costs in the NT. The increase in estimated gold reserves resulted from increasing the gold price used in the reserve estimate from$1,000 to$1,125 per ounce and changing the cut-off grade from 0.40 g Au/t to 0.35 g Au/t. Our decision to use a third-party power provider resulted in important positive impacts to our capital costs and insulates the Project from certain construction and operating risks while maintaining what we believe to be attractive operating costs. While our operating costs have increased as a result of higher labor, reagent, grinding media and over-the-fence power costs, our core energy costs yield some offsetting savings.
Management believes the results of the 2022 FS demonstrate an attractive project development opportunity and allow the Company to evaluate a broad range of alternatives to advance Mt Todd as we continue to focus on maximizing shareholder value.
13 Table of Contents InJune 2022 , Vista announced the completion of the third phase of its exploration drilling program at Mt Todd. Results from this program and historical sources demonstrate the resource growth potential within a 5.4 km trend extending immediately north from the Batman pit, including delineation of four highly prospective exploration targets, potentially representing up to an additional 1.8 to 3.5 million gold ounces (see details and cautionary information below). The Company continues to focus on monetizing non-core assets as a non-dilutive source of funding. Vista realized$2,500 inJanuary 2022 in exchange for cancelling its remaining royalty interests in the Awak Mas project inIndonesia ("Awak Mas"). The Company also owns a royalty interest in aU.S. exploration-stage project and used mill equipment that is being marketed by a third-party mining equipment dealer.
Mineral Resources and Mineral Reserves Estimates
The table below presents the estimated mineral resources for the Project. The effective date of the resource estimates isDecember 31, 2021 . The following mineral resources and mineral reserves were prepared in accordance with both subpart 1300 of Regulation S-K ("S-K 1300") under the Securities Exchange Act of 1934 (the "Exchange Act"), as amended and CIM Definition Standards as set forth in the 2022 FS, which is available as Exhibit 96.1 to the Company's Annual Report on Form 10-K as filed with theSecurities and Exchange Commission (the "SEC") onFebruary 24, 2022 . The 2022 FS for Mt Todd is the technical report summary, prepared pursuant to S-K 1300, that was filed on EDGAR onFebruary 24, 2022 and is entitled "S-K 1300 Technical Report Summary -Mt Todd Gold Project - 50,000 tpd Feasibility Study -Northern Territory, Australia " with an effective date ofDecember 31, 2021 and an issue date ofFebruary 9, 2022 . A companion feasibility study for Canadian purposes, pursuant to National Instrument 43-101 Standards of Disclosure forMineral Properties ("NI 43-101"), was filed on SEDAR onFebruary 24, 2022 and is entitled "NI 43-101 Technical Report -Mt Todd Gold Project - 50,000 tpd Feasibility Study -Northern Territory, Australia " with an effective date ofDecember 31, 2021 and an issue date ofFebruary 9, 2022 . The 2022 FS is available for review at www.sec.gov and under our profile at www.sedar.com. The 2022 FS is not incorporated by reference into this quarterly report on Form 10-Q.Mt Todd Gold Project - Summary of Gold Mineral Resources at the End of the Fiscal Year EndedDecember 31, 2021 based onUS$1,300 /oz Gold Batman Deposit Heap Leach Pad Quigleys Deposit Total Contained Contained Contained Contained Tonnes Grade Ounces Tonnes Grade Ounces Tonnes Grade Ounces Tonnes Grade Ounces (000s) (g Au/t) (000s) (000s) (g Au/t) (000s)
(000s) (g Au/t) (000s) (000s) (g Au/t) (000s) Measured 77,725 0.88 2,191 - - - 594 1.15 22 78,319 0.88 2,213 Indicated 200,112 0.80 5,169 13,354 0.54 232 7,301 1.11 260 220,767 0.80 5,661 Measured & Indicated 277,837 0.82 7,360 13,354 0.54 232 7,895 1.11 282 299,086 0.82 7,874 Inferred 61,323 0.72 1,421 - - - 3,981 1.46 187 65,304 0.77 1,608 Notes:
• Measured & indicated resources include proven and probable reserves.
• Batman and Quigleys resources are quoted at a 0.40g-Au/t cut-off grade. Heap
Leach resources are the average grade of the heap, no cut-off applied.
Batman: Resources constrained within a
• Pit parameters: Mining Cost
processed, G&A Cost
Sulfide 85%, Transition 80%, Oxide 80%, 0.2g-Au/t minimum for resource shell.
Quigleys: Resources constrained within a
• Pit parameters: Mining cost
processed, Royalty 1% GPR, Gold Recovery Sulfide, 82.0% and Ox/Trans 78.0%,
water treatment
Differences in the table due to rounding are not considered material.
• Differences between Batman and Quigleys mining and metallurgical parameters are
due to their individual geologic and engineering characteristics.
• 43-101 and S-K 1300 ("QP") responsible for the Statement of Mineral Resources
for the Batman, Heap Leach Pad and Quigleys deposits.
•
WhittleTM pit shell for the Batman Deposit.
14 Table of Contents
• The effective date of the Heap Leach, Batman and Quigleys resource estimate is
• Mineral resources that are not mineral reserves have no demonstrated economic
viability and do not meet all relevant modifying factors.
Mt Todd Gold Project - Summary of Gold Mineral Reserves at the End of the Fiscal Year EndedDecember 31, 2021 based - 50,000 tpd, 0.35 g Au/t cut-off and$1,125 per ounce pit design Batman Deposit Heap Leach Pad Total Contained Contained Contained Tonnes Grade Ounces Tonnes Grade Ounces Tonnes Grade Ounces (000s) (g Au/t) (000s) (000s) (g Au/t) (000s) (000s) (g Au/t) (000s) Proven 81,277 0.84 2,192 - - - 81,277 0.84 2,192 Probable 185,744 0.76 4,555 13,354 0.54 232 199,098 0.75 4,787 Proven & Probable 267,021 0.79 6,747 13,354 0.54 232 280,375 0.77 6,979 Notes:
• Thomas L. Dyer, P.E., is the QP responsible for reporting the Batman Deposit
Proven and Probable reserves.
• Batman deposit reserves are reported using a 0.35 g Au/t cutoff grade.
•
reserves.
• Because all the heap-leach pad reserves are to be fed through the mill, these
reserves are reported without a cutoff grade applied.
• The reserves point of reference is the point where material is fed into the
mill.
• The effective date of the mineral reserve estimates is
Cautionary note to investors: Proven and probable mineral reserves are estimated in accordance with each of S-K 1300 and CIM Definition Standards. A number of risk factors may adversely affect estimated mineral reserves and mineral resources, any of which may result in a reduction or elimination of reported mineral reserves and mineral resources. See "Item 1A. Risk Factors" in the Company's Form 10-K as filed with theSEC onFebruary 24, 2022 .
Results from Operations
Summary
Cash and short-term investments totaled$11,070 and working capital was$10,465 atJune 30, 2022 . See "Liquidity and Capital Resources". The Company had no debt as ofJune 30, 2022 . Consolidated net loss for the three months endedJune 30, 2022 and 2021 was$1,424 and$753 , or$0.01 and$0.01 per basic share, respectively. Consolidated net loss for the six months endedJune 30, 2022 and 2021 was$1,744 and$3,852 , or$0.01 and$0.04 per basic share, respectively. The principal components of the period-over-period changes are discussed below.
Operating income and expenses
Gain on disposition of mineral property interests, net
In
In January andJune 2021 , the Company received a total of$2,100 for cancellation of its royalty interests and back-in right inLos Reyes . TheJanuary 2021 payment of$1,100 was initially recorded as deferred option gain, with the full$2,100 recognized as a gain upon receipt of the second payment inJune 2021 . 15 Table of Contents
Exploration, property evaluation and holding costs
Exploration, property evaluation and holding costs were$984 and$1,986 for the three months endedJune 30, 2022 and 2021, respectively; and$2,773 and$3,737 for the six months endedJune 30, 2022 and 2021, respectively. The decrease in 2022 for the comparative three-month periods was primarily attributable to lower spending of$629 on the drilling program,$184 for other site-related activities, and$102 for feasibility study work. The decrease in 2022 for the comparative six-month periods was primarily attributable to lower spending of$670 on the drilling program,$375 for other site-related activities, offset by$372 higher costs for feasibility study work in 2022 which was completed in
the first quarter. Corporate administration
Corporate administration costs were
Non-operating income and expenses
Other income/(loss)
During the quarter endedJune 30, 2022 , the Company reviewed and reversed a previously accrued amount of$240 for contingent reclamation costs because the associated costs are neither probable nor could be reasonably estimated. Also, the Company received cash of$196 inMay 2022 as a value-added tax recovery from the previous sale of a non-core asset.
Financial Position, Liquidity and Capital Resources
Operating activities
Net cash used in operating activities was$4,252 and$4,788 for the six months endedJune 30, 2022 and 2021, respectively. The decrease in operating cash outflows in 2022 reflects lower spending for drilling, offset by feasibility study work and final payments on both programs.
Investing activities
Net cash provided by investing activities was$2,495 and$2,622 for the six months endedJune 30, 2022 and 2021, respectively. The principal source of cash from investing activities during the six months endedJune 30, 2022 was the$2,500 final payment for the Awak Mas royalty cancellation. Sources of cash from investing activities during the six months endedJune 30, 2021 were$2,100 for payments related toLos Reyes ,$180 for payments related toAwak Mas and$400 net upon dispositions of short-term investments.
Financing activities
During the six months endedJune 30, 2022 and 2021, net cash of ($304 ) and$666 , respectively, was (used)/provided by financing activities. Cash used by financing activities during the six months endedJune 30, 2022 was for payments for employee withholding tax obligations in lieu of issuing common shares of the Company ("Common Shares") offset by$51 of net proceeds under the ATM Program (defined below). Cash from financing activities during the six months endedJune 30, 2021 included net proceeds of$1,062 under the ATM Program, offset by payments of$396 for employee withholding tax obligations in lieu of issuing Common Shares.
Liquidity and capital resources
Our cash liquidity position as ofJune 30, 2022 , comprising cash and cash equivalents of$10,696 , reflected a net decrease of$2,061 during the six months endedJune 30, 2022 . We benefited from net proceeds of$2,500 for cancellation of the Awak Mas royalty, a$196 value-added tax recovery from the previous sale of non-core assets, and ATM Program proceeds 16
Table of Contents
as discussed below. These cash inflows were offset by expenditures of$4,808 , which included substantially all final payments for the exploration drilling program and the 2022 FS. As a secondary measure of liquidity, the Company had working capital of$10,465 and$12,164 atJune 30, 2022 andDecember 31, 2021 , respectively. These amounts were net of deferred option gain of $nil and$383 , respectively, related to the Awak Mas transaction. The deferred option gain was recognized as income during the three months endedMarch 31, 2022 and did not require any use of current assets. Consequently, the components of working capital affecting Vista's liquidity and capital resources included: At June 30, 2022 At December 31, 2021 Current Assets $ 11,491 $ 13,952
Offset by accounts payable and accrued liabilities $ (1,026) $
(1,405) Vista completed the 2022 FS and the third phase of its exploration drilling program during the three months endedMarch 31, 2022 and made substantially all final payments to vendors for this work during the second quarter of 2022. Other potential discretionary programs that may be undertaken during the balance of 2022 could total up to an additional$600 . Fixed costs for corporate activities and Mt Todd care and maintenance continued in line with the Company's currently forecasted annualized rate of approximately$7,000 . Management is evaluating opportunities to reduce this annualized rate and expects to begin implementing cost reductions starting in the second half of 2022. Potential sources of cash inflows include monetization of non-core assets and use of the ATM Program. InFebruary 2022 ,Australia lifted restrictions on international travel to and from the country for fully vaccinated individuals. Vista believes this action will continue to have a positive impact for the Company by allowing greater in-person interaction between senior management and local stakeholders and continue to enhance the formal process we have initiated with CIBC to secure a strategic partner or other form of transaction to achieve greater value recognition for the Mt Todd project. The Company renewed its at-the-market offering agreement inDecember 2021 (the "ATM Agreement") withH. C. Wainwright & Co. LLC ("Wainwright") to provide balance sheet flexibility at a potentially lower cost than other means of equity issuances. Under the ATM Agreement the Company can, but is not obligated to, issue and sell Common Shares through Wainwright for aggregate gross proceeds of up to$10,000 (the "ATM Program"). During the three months endedJune 30, 2022 , the Company sold 50,000 Common Shares under the ATM Program for net proceeds of$51 . Aggregate net proceeds sold under the prior ATM agreement totaled$2,830 throughDecember 31, 2021 . Offers or sales of Common Shares under the ATM Program will be made only inthe United States in an "at the market offering" as defined in Rule 415 under the United States Securities Act of 1933, as amended, subject to an effective registration statement under theU.S. Securities Act of 1933, as amended, and no offers or sales of Common Shares under the ATM Agreement will be made inCanada . The Common Shares will be distributed at market prices prevailing at the time of sale. Giving consideration to current economic conditions and the Company's ongoing initiatives, we believe our existing working capital as ofJune 30, 2022 , together with other potential future sources of non-dilutive financing, will be sufficient to fully fund our currently planned corporate expenses, Project holding costs and discretionary programs for at least 12 months. Vista's long-term viability depends upon our ability to realize value from our principal asset, Mt Todd. Our primary objective is to maintain adequate liquidity and seek to preserve, enhance and realize value of our core assets in order to achieve positive returns for our shareholders. Our funding strategy is to maintain a low expenditure profile, realize value from non-core assets and, when necessary, issue additional equity or find other means of financing. The underlying value and recoverability of the amounts shown as mineral properties and plant and equipment in our Condensed Consolidated Balance Sheets are dependent on our ability to attract sufficient capital resources to execute our strategy and the ultimate success of our programs to enhance and realize value, most importantly at Mt Todd. 17 Table of Contents
Off-Balance Sheet Arrangements
We have no off-balance sheet arrangements.
Contractual Obligations
We have no material contractual obligations as of
Projects Update
Recent Developments
Vista acquired Mt Todd in 2006. Since that time, we have invested over$110 million to systematically explore, evaluate, engineer, permit and de-risk the Project. Through the end of 2021, all technical reports, mineral resources and reserves estimates, and other property-related disclosures have been reported under NI 43-101. Starting in 2022, we were required to also establish mineral resources and reserves estimates under S-K 1300 standards for reporting purposes inthe United States , while continuing to meet reporting standards under NI 43-101 for Canadian purposes. We have continued to de-risk Mt Todd and undertake activities to increase shareholder value in a cost-effective manner. We believe Mt Todd's attributes and advanced stage of technical evaluation and permitting provide a solid basis to engage with a range of prospective parties as we seek an appropriate strategic transaction. Key considerations in any potential transaction include value creation by recognizing a greater portion of the intrinsic value of Mt Todd and minimizing future equity dilution. Travel restrictions have been lifted, and we can now travel in and out ofAustralia , which we believe should facilitate our efforts to unlock the value of Mt Todd. Vista completed a feasibility study for Mt Todd and announced the results onFebruary 9, 2022 and filed the SK-1300 and NI 43-101 Technical Reports onFebruary 24, 2022 . This study addressed recommendations from the 2019 pre-feasibility study; reflects minor updates of the Project design to be consistent with the MMP; and advanced the levels of engineering and detailed costing in all areas of the Project. It evaluated several trade-off opportunities (e.g., contract power generation, contract mining and autonomous truck haulage). The 2022 FS resulted in a larger reserve and longer mine life based on new mine plans using a conservative gold price assumption that is more reflective of current gold prices. The operational MMP for Mt Todd was approved by theNorthern Territory Department of Industry, Tourism and Trade inJune 2021 . The operational MMP (similar to a mine operating permit inNorth America ) was the final major authorization required for the development of the Mt Todd mine. Receipt of this approval marked the achievement of a major de-risking milestone that was a significant focus of the Company for three years. We believe this approval, combined with the previously-approved major environmental permits, demonstrates the quality and advanced stage of engineering and project planning. This operational MMP is being updated to reflect the project changes in the 2022 FS. Vista completed exploration drilling at Mt Todd inMarch 2022 and reported final assay results inJune 2022 . The drilling program was focused on identifying connecting structures and mineralization between previously interpreted discrete deposits and the potential for efficient resource growth with future drilling along strike from the Batman deposit, approximately 1.9 kilometers north to the Golf-Tollis/Penguin targets. We believe the program successfully achieved our goal of demonstrating the regional potential along a 5.4-kilometer portion of the 24-kilometer Batman-Driffield Trend and outlining areas where future drilling can be undertaken to efficiently define additional gold resources. Vista's drilling program completed 26 planned drill holes (approximately 8,898 meters). The drill holes consistently intersected mineralization predicted by our geologic model and demonstrate both horizontal and vertical continuity
of the targeted structures. 18 Table of Contents Based on this recent exploration program and historical sources, the Company has demonstrated continuity of mineralized structures from the Batman deposit to north of the Golf-Tollis deposit (+2 km) and delineated four areas with the potential to host additional mineralization, including:
•
within 15.5 to 35 Mt grading 0.8 to 1.2 g Au/t;
Northern cross load ("NXLD") and Southern cross load ("SXLD") - have the
• potential for 400,000 to 800,000 oz Au contained within
to 1.5g Au/t;
• Golf-Tollis - has the potential for 210,000 to 320,000 oz Au contained within
3.5 to 6.5 Mt grading 0.9 to 1.4 g Au/t; and
• Quigleys Deposit - has the potential for an additional 700,000 to 1,400,000 oz
Au contained within
The exploration target potentials were derived by the similarities to the Batman deposit sheeted vein system and their surrounding mineralization, as evidenced by drill intercepts in the exploration target area across vertical cross and long sections. The volume of the modeled areas determines the potential tonnage statement in the exploration target. The grade range given in the exploration target is determined with consideration to the drill results within the modeled exploration target area and consideration of the geological setting in an established mining camp. The potential tonnages and grades are conceptual in nature and are based on drill results that defined the approximate length, thickness, depth and grade of the portion of the historical resource estimate. There has been insufficient exploration to define a current mineral resource and the Company cautions that there is uncertainty whether further exploration will result in such exploration targets being delineated as a mineral resource. The upper NXLD / SXLD intercepts represent the high-grade zone within the Batman-Driffield Structural corridor and given that these structures have yet to be targeted or systematically explored, they represent excellent opportunities for discovery of near surface, high-grade mineralization. Structures parallel to the NXLD / SXLD are most likely to host high-grade, near surface mineralization within the Mt Todd package.
The sampling method and approach for the drillholes are as follows:
• The drill core, upon removal from the core barrel, is placed into plastic core
boxes;
• The plastic core boxes are transported to the sample preparation building;
The core is marked, geologically logged, geotechnically logged, photographed,
and sawn into halves. One-half is placed into sample bags as one-meter sample
• lengths, and the other half retained for future reference. The only exception
to this is when a portion of the remaining core has been flagged for use in
metallurgical testwork;
The bagged samples have sample tags placed both inside and on the outside of
• the sample bags. The individual samples are grouped into "lots" for submission
to NAL, a certified lab, for preparation and analytical testing; and
• All of this work was done under the supervision of a Vista geologist.
Processing of the core included photographing, geotechnical and geologic logging, and marking the core for sampling. The nominal sample interval was one meter. When this process was completed, the core was moved into the core cutting/storage area where it was laid out for sampling. The core was laid out using the following procedures:
• One meter depth intervals were marked out on the core by a member of the
geologic staff;
Core orientation (bottom of core) was marked with a solid line when at least
• three orientation marks aligned and used for structural measurements. When
orientation marks were insufficient an estimated orientation was indicated by a
dashed line;
Geologic logging was then done by a member of the geologic staff. Assay
• intervals were selected at that time and a cut line marked on the core. The
standard sample interval was one meter, with a minimum of 0.2 meters and a maximum of 1.2 meters;
Blind sample numbers were then assigned based on pre-labeled sample bags.
• Sample intervals were then indicated in the core tray at the appropriate
locations; and
• Each core tray was photographed and restacked on pallets pending sample cutting
and stored on site indefinitely. 19 Table of Contents The core was then cut using diamond saws with each interval placed in sample bags. At this time, the standards and blanks were also placed in plastic bags for inclusion in the shipment. A reference standard or a blank was inserted at a minimum ratio of 1 in 10 and at suspected high grade intervals additional blanks sample were added. Standard reference material was sourced fromOre Research & Exploration Pty Ltd and provided in 60 g sealed packets. When a sequence of five samples was completed, they were placed in a shipping bag and closed with a zip tie. All of these samples were kept in the secure area until crated for shipping. Samples were placed in crates for shipping with 100 samples per crate (20 shipping bags). The crates were stacked outside the core shed until picked up for transport and shipped to NAL inPine Creek ,Northern Territory , for standard fire assays. At the lab, the samples are pulverized and split down to 50-gram assay samples prior to assaying. The industry-standard 3 assay-ton fire assay is followed by an atomic absorption finish, except where results report a result of greater than 3 g Au/t, and then a gravimetric finish is used to report final results. The QP is satisfied that sample security measures meet industry standards. Statistical analysis of the various drilling populations and quality assurance and quality control samples has not identified or highlighted any reasons to not accept the data as representative of the tenor and grade of the mineralization estimated at the Batman deposit.
All scientific and technical information herein has been reviewed and approved
by
Vista held an NSR inAwak Mas . Previously, Vista and the holder ofAwak Mas amended our original royalty agreement to allow the holder or a nominated party to make a payment to Vista to cancel half of the original NSR and cancel the second half after making the first payment. The holder of the Awak Mas royalty made the final$2,500 payment onJanuary 28, 2022 . The Company recognized a gain of$2,883 for this final payment, which included recognition of$383 that was carried as deferred option gain as ofDecember 31, 2021 . With this final payment, the Company has no remaining royalty interest inAwak Mas .
Certain
Vista has been a "passive foreign investment company" ("PFIC") as defined under Section 1297 of theU.S. Internal Revenue Code of 1986, as amended, in recent years and expects to continue to be a PFIC in the future. Current and prospectiveUnited States shareholders should consult their tax advisors as to the tax consequences of PFIC classification and theU.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 endedDecember 31, 2021 , under "Part II. Item 5. Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases ofEquity Securities - Certain United States Federal Income Tax Considerations forU.S. Residents."
Note Regarding Forward-Looking Statements
This quarterly report on Form 10-Q contains "forward-looking statements" within the meaning of the 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 on Form 10-Q, our other filings with theSecurities and Exchange Commission and Canadian securities commissions and in press releases and public statements by our officers or representatives that address activities, events or developments that we expect or anticipate 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. Operations
Our belief that our focus on evaluation, acquisition, exploration and
? advancement of gold exploration and potential development projects may lead to
gold production or value-adding strategic transactions;
20 Table of Contents
? our belief that our work has added substantial value to the Project and
positions the Project for near-term development;
our belief that the resilience of Mt Todd, in part supported by the positive
? impact of the current foreign exchange rate, is demonstrated by the project
economics reflected in the 2022 FS;
our belief that the decision to use a third-party power provider resulted in
? important positive impacts to our capital costs and insulates the Project from
certain construction and operating risks while maintaining what we believe to
be attractive operating costs;
our belief that the results of the 2022 FS demonstrate an attractive project
? development opportunity and allow the Company to evaluate a broad range of
alternatives to advance Mt Todd as we continue to focus on maximizing shareholder value;
our belief that Mt Todd's attributes and advanced stage of technical evaluation
? and permitting provide a solid basis to engage with a range of prospective
parties as we seek an appropriate strategic transaction;
our belief that the MMP approval, combined with the previously-approved major
? environmental permits, demonstrates recognition of the quality and advanced
stage of engineering and project planning;
? our estimates of future operating and financial performance;
? our belief that recent drilling is consistent with our geologic model and
demonstrates vertical and horizontal continuity of mineralization;
our belief that the recent exploration program delineated four areas with the
potential to host additional mineralization, that the potential tonnages and
? grades are conceptual in nature, and that there is uncertainty whether further
exploration will result in such exploration targets being delineated as a
mineral resource;
? our belief that the upper NXLD / SXLD intercepts represent excellent
opportunities for discovery of near surface, high-grade mineralization;
? our expectation to begin implementing cost reductions starting in the second
half of 2022;
our belief that travel to
? by allowing greater in-person interaction between senior management and local
stakeholders, and enhance our efforts to secure a strategic partner or other
form of transaction;
our belief that the drilling program has successfully achieved our goal of
? demonstrating the regional potential along a 5.4-kilometer portion of the
24-kilometer Batman-Driffield Trend and to outline areas where future drilling
can be undertaken to efficiently define additional gold resources;
our belief that our existing working capital at
? other potential future sources of non-dilutive financing, will be sufficient to
fully fund our currently planned corporate expenses and Project holding costs
for at least 12 months;
? our belief that Vista's long-term viability depends upon our ability to realize
value from our principal asset, Mt Todd;
our objective to maintain adequate liquidity and seek to preserve, enhance and
? realize value of our core assets in order to achieve positive returns for our
shareholders; Business and Industry
? our belief that we are in compliance in all material respects with applicable
laws and regulations;
? our expectation that we will continue to be a PFIC for
purposes;
? the potential that we may grant options and/or other stock-based awards to our
directors, officers, employees and consultants; and
21 Table of Contents
? the potential that future expenditures may be required for compliance with
various laws and regulations governing the protection of the environment.
Forward-looking statements and forward-looking information have been based upon a number of estimates and assumptions including material estimates and assumptions related to our current business and operating plans, as approved by the Company's Board of Directors; 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; our experience working with our regulators; 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: Operating Risks
? pre-feasibility and feasibility study results, timing and the accuracy of
estimates and assumptions on which they are based;
resource and reserve estimates, the accuracy of such estimates and the accuracy
? of sampling and subsequent assays and geologic interpretations on which they
are based;
? technical and operational feasibility and the economic viability of deposits;
our ability to obtain, renew or maintain the necessary licenses, authorizations
? and permits for Mt Todd, including its development plans and operating
activities;
? market conditions supporting a decision to develop Mt Todd;
? delays in commencement of construction at Mt Todd;
? our reliance on third-party power generation for the construction and operation
of Mt Todd;
? increased costs that affect our operations or our financial condition;
? delays or disruptions in supply chains;
? our reliance on third parties to fulfill their obligations under agreements
with us;
? whether projects not managed by us will comply with our standards or meet
our objectives;
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;
? the success of any future joint ventures, partnerships and other arrangements
relating to our properties;
? perception of the potential environmental impact of Mt Todd;
? known and unknown environmental and reclamation liabilities, including
reclamation requirements at Mt Todd;
? potential challenges to the title to our mineral properties;
? future water supply issues at Mt Todd;
? litigation or other legal claims;
? environmental lawsuits;
Financial and Business Risks
? fluctuations in the price of gold;
22 Table of Contents
? inflation and cost escalation;
? lack of adequate insurance to cover potential liabilities;
? the lack of cash dividend payments by us;
? our history of losses from operations;
? our ability to attract, retain and hire key personnel;
? volatility in our stock price and gold equities generally;
? our ability to obtain a development partner or other means of financing for Mt
Todd on favorable terms, if at all;
? our ability to raise additional capital or raise funds from the sale of
non-core assets on favorable terms, if at all;
? industry consolidation which could result in the acquisition of a control
position in the Company for less than fair value;
? evolving corporate governance and public disclosure regulations;
? intense competition in the mining industry;
? tax initiatives on domestic and international levels;
? potential changes in regulations of taxation initiatives;
? fluctuation in foreign currency values;
? our likely status as a PFIC for
delays, potential losses, and/or inability to maintain sufficient working
? capital due to business interruptions, supply chain disruptions, or global
economic slowdowns caused by the COVID-19 pandemic;
Industry Risks
? inherent hazards of mining exploration, development and operating activities;
? a shortage of skilled labor, equipment and supplies;
the accuracy of calculations of mineral reserves, mineral resources and
? mineralized material and fluctuations therein based on metal prices, and
inherent vulnerability of the ore and recoverability of metal in the
mining process;
changes in environmental regulations to which our exploration and development
? operations are subject could result in increased operating costs or our ability
to operate at all; and
? changes in greenhouse gas emissions regulations and standards could result in
increased operating costs or our ability to operate at all.
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 endedDecember 31, 2021 , under "Part I-Item 1A. Risk Factors" and in this report under "Part II-Item 1A. 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. 23 Table of Contents
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