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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 6-K
Report of Foreign Issuer
Pursuant to Rule 13a-16 or 15d-16 of
the Securities Exchange Act of 1934
For the period of October 22, 1998 Commission File Number: 1-9025
VISTA GOLD CORP.
(Name of Registrant)
Suite 3000
370 Seventeenth Street
Denver, Colorado 80202
(Address of Principal Executive Offices)
Indicate by check mark whether the registrant files or will file annual reports
under cover of Form 20-F or Form 40-F.
Form 20-F X Form 40-F
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Indicate by check mark whether the registrant by furnishing the information
contained in this Form is also thereby furnishing the information to the SEC
pursuant to Rule 12g3-2(b) under the Securities Exchange Act of 1934.
Yes No X
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If "Yes" is marked, indicate the file number assigned to the registrant in
connection with Rule 12g3-2(b): Not applicable.
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SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934,
the registrant has duly caused this report to be signed on its behalf by the
undersigned, thereunto duly authorized.
VISTA GOLD CORP.
Date: October 22, 1998 By: /s/ Roger L. Smith
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Roger L. Smith
Vice President Finance
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EXHIBIT INDEX
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Exhibit Description of Exhibit
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99.1 Press release dated October 22, 1998, Vista completes
acquisition of Mineral Ridge Resources Inc.
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EXHIBIT 99.1
VISTA COMPLETES ACQUISITION OF MINERAL RIDGE RESOURCES INC.
DENVER, COLORADO, OCTOBER 22, 1998 - Vista Gold Corp. ("Vista") is pleased to
announce that yesterday it completed the acquisition of Mineral Ridge Resources
Inc. ("MRRI") from Cornucopia Resources Ltd. ("Cornucopia"). Vista has acquired
all of the shares of MRRI in consideration for 1,562,000 shares of Vista at an
aggregate value of US$250,000 and having subscribed on a private placement basis
for 2,777,777 shares of Cornucopia valued at US$250,000.
The Mineral Ridge mine, located near the town of Silver Peak, approximately 35
miles southwest of Tonopah, Nevada, was constructed by Cornucopia for a cost of
approximately US$17 million. The project was completed on May 17, 1997 and the
first gold was poured on June 20, 1997. However the project failed to meet
commercial production loan tests and was shutdown in December 1997. Vista has
completed an in-depth technical review and will undertake a number of
modifications to the facility prior to the restart of operations to eliminate
the problems experienced by Cornucopia. The improvements include changes to the
crushing and agglomeration circuits, the addition of surge capacity to the
crushing plant, employment of a coarser crusher product size and the
introduction of strong leach solutions during the agglomeration process, all of
which Vista believes will improve the rate of recovery of gold .
As a result of its due diligence study, Vista now estimates the proven and
probable reserves to be 4 million tons at a grade of 0.06 ounces per ton
containing 243,000 ounces of gold. The average estimated cash production costs
will be US$226 per ounce and production is planned to be approximately 55,000
ounces in 1999.
As part of the transaction, MRRI has amended their loan agreement with Dresdner
Bank. The amended agreement revises the terms of repayment of the previously
outstanding loan and accrued interest totaling approximately US$13.5 million and
additional loans to MRRI totaling US$1.6 million which will be used to pay
amounts owing to other creditors of MRRI. The revised agreement calls for the
contribution of US$5.0 million of mining equipment to the project by Vista and
the distribution of net cash flow on the basis of 70 percent to Dresdner Bank
and 30 percent to Vista after deduction of US$800,000 of management fees payable
to Vista over the next two years and rescheduled principal payments on the
additional loans used to repay other creditors. Interest rate on the loans will
be LIBOR plus 2 percent and the loans will be secured by the assets of MRRI and
the US$5 million worth of mining equipment contributed by Vista. As part of the
agreement with Dresdner, MRRI will liquidate forward gold hedges to provide
US$3.5 million, which will be used as working capital and to pay for capital
improvements on the project.
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Vista has also executed an amendment to MRRI's principal royalty agreement with
Mary Mining Company Inc. to modify the royalties payable from the current flat
rate of 4 percent if the gold price is US$500 or less, to a graduated scale
which increases progressively from 21/2 percent if the gold price is US$300 or
less to 5 percent if the gold price is greater than US$400 but less than or
equal to $500 per ounce. In consideration for the modification, Vista has paid
Mary Mining Company US$24,000 in additional advance royalty payments in 1998.
Earlier this week, the Company also made the final payment on the US$13 million
Hycroft Resources and Development Inc. loan to Scotia Bank. Vista continues to
advance its efforts to finance the construction and development of the
Amayapampa project in Bolivia. The Company anticipates being in a position to
obtain satisfactory project financing at a gold price between US$300 and US$325
per ounce.
Vista Gold Corp. is an international gold mining, development and exploration
company based in Denver, Colorado. Its holdings include the Hycroft and Mineral
Ridge mines in Nevada, a development project in Bolivia and exploration projects
in North and South America.
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The statements that are not historical facts are forward-looking statements
involving known and unknown risks and uncertainties that could cause actual
results to vary materially from the targeted results. Such risks and
uncertainties include those described in the Company's Form 20-F as amended.
For further information, please contact Investor Relations at (303) 629-2450.
