Littleton, Colorado-based Vista Gold (VGZ-T) has laid plans for a private placement of 1.4 million special warrants at US$2.42 apiece for gross proceeds of US$3.4 million.
The special warrants will automatically convert into equity units once shareholder approval of such a move is received. The transaction will face a vote at a special shareholders’ meeting before the end of February.
Each equity unit will comprise one share plus one warrant, exercisable at US$3.14 per share in the first year. The exercise price increases by US42 in the second year and US36 per share in each of the remaining two years. If the company’s issue is trading at a 150% premium to the exercise prices from year 2 on, Vista can mandate that the warrants be exercised or face cancellation.
A placement agent will earn a10% cash finder’s commission in connection with the private placement.
Vista plans to use the proceeds to explore its existing gold projects, acquire new gold projects, and for general corporate purposes.
Vista and partner Silver Standard Resources (SSO-V) recently reported cutting mineralization 500-2200 ft. from the known resource on the Maverick Springs property, southeast of Elko, Nev.
All seven holes in a 7,000-ft. reverse-circulation drilling program cut flat-lying, mostly oxide gold-silver mineralization to depths of up to 900 ft. The westernmost hole, no. 130, returned 200 ft. grading 0.008 oz. gold and 3.85 oz. silver per ton at a down-hole depth of 650 ft., whereas the northernmost hole, no. 135, returned 110 ft. of 0.026 oz. gold and 3.07 oz. silver at 690 ft. down-hole.
Mineralization covers a 2,200-by-1,200-ft. area immediately adjacent to known gold-silver resources. The area of known mineralization now comprises 6,000 by 2,500 ft. Current indicated and inferred resources, at a cutoff of 0.5 oz. silver per ton, stand at 27.4 million tons averaging 1.18 oz. silver and 56.8 million tons of 1.21 oz. silver, respectively.
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