Item 5. Market for Registrant’s Common Equity
ITEM 5. MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTER S AND ISSUER PURCHASES OF EQUITY SECURITIES.
Market and Trading Symbol of Common Shares
The Common Shares of Vista Gold are listed on the NYSE American and the Toronto Stock Exchange under the trading symbol “VGZ”. On February 21, 2023, the last reported sale price of the Common Shares of Vista on the NYSE American was $0.53, there were 118,989,927 Common Shares issued and outstanding, and we had approximately 223 registered shareholders of record. The Company also has 7,408,101 unlisted warrants outstanding that are not actively traded on an exchange.
Dividends
We have never paid cash dividends. The declaration and payment of future dividends, if any, will be determined by our Board of Directors and will depend on our earnings, financial condition, conditions that may be imposed by future potential financing arrangements, future cash requirements and other relevant factors.
Securities Authorized for Issuance under Equity Compensation Plans
The following table sets out information relating to the Company’s equity compensation plans as of December 31, 2022. The Company’s equity compensation plans as of December 31, 2022 were the Stock Option Plan, the Long-Term Incentive Plan (“LTIP”), and the Deferred Share Unit Plan (“DSU Plan”). Equity compensation under these plans has been granted to directors, officers, employees, and consultants of the Company, as applicable.
Plan Category
Number of securities to be issued upon exercise/conversion of outstanding options and rights
Weighted-average exercise price of outstanding options and rights
Number of securities remaining available for future grants under equity compensation plans (excluding securities reflected in column (a))
(a)
(b)
(c)
Equity compensation plans approved by securityholders
4,093,008
0.24
7,755,080
Equity compensation plans not approved by securityholders
N/A
N/A
N/A
Total
4,093,008
0.24
7,755,080
As of December 31, 2022, 1,472,008 restricted share units (“RSUs”) were outstanding under the LTIP, 1,254,000 deferred share units (“DSUs”) were outstanding under the DSU Plan, and 1,367,000 options were outstanding under the Stock Option Plan to acquire an aggregate of 4,093,008 Common Shares.
See Note 6 to our consolidated financial statements contained in “Part II. Item 8. Financial Statements and Supplementary Data” for additional information relating to our equity compensation plan.
Exchange Controls
There are no governmental laws, decrees or regulations in Canada that restrict the export or import of capital, including foreign exchange controls, or that affect the remittance of dividends, interest, or other payments to non-resident holders of
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the securities of Vista, other than Canadian withholding tax. See “Certain Canadian Federal Income Tax Considerations for U.S. Residents” below.
Certain Canadian Federal Income Tax Considerations for U.S. Residents
The following summarizes certain Canadian federal income tax consequences generally applicable under the Income Tax Act (Canada) and the regulations enacted thereunder (collectively, the “Canadian Tax Act”) and the Canada-United States Income Tax Convention (1980) (the “Convention”) to the holding and disposition of Common Shares.
Comment is restricted to holders of Common Shares each of whom, at all material times for the purposes of the Canadian Tax Act and the Convention:
(i) is resident solely in the United States;
(ii) is entitled to the benefits of the Convention;
(iii) holds all Common Shares as capital property;
(iv) holds no Common Shares that are “taxable Canadian property” (as defined in the Canadian Tax Act) of the holder;
(v) deals at arm’s length with and is not affiliated with Vista;
(vi) does not and is not deemed to use or hold any Common Shares in a business carried on in Canada; and
(vii) is not an insurer that carries on business in Canada and elsewhere;
(each such holder, a “U.S. Resident Holder”).
Certain U.S.-resident entities that are fiscally transparent for United States federal income tax purposes (including limited liability companies) are generally not themselves entitled to the benefits of the Convention. However, members of, or holders of, an interest in such entities that hold Common Shares may be entitled to the benefits of the Convention for income derived through such entities. Such members or holders should consult their own tax advisors in this regard.
Generally, a holder’s Common Shares will be considered to be capital property of the holder provided that the holder is not a trader or dealer in securities, did not acquire, hold or dispose of the Common Shares in one or more transactions considered to be an adventure or concern in the nature of trade and does not hold the Common Shares as inventory in the course of carrying on a business.
Generally, a holder’s Common Shares will not be “taxable Canadian property” of the holder at a particular time at which the Common Shares are listed on a “designated stock exchange” (which currently includes the TSX) unless both of the following conditions are met at any time during the 60-month period ending at the particular time:
(i) the holder, persons with whom the holder does not deal at arm’s length, or any partnership in which the holder or persons with whom the holder did not deal at arm’s length holds a membership interest directly or indirectly through one or more partnerships, alone or in any combination, owned 25% or more of the issued shares of any class of the capital stock of Vista; and
(ii) more than 50% of the fair market value of the Common Shares was derived directly or indirectly from, or from any combination of, real or immovable property situated in Canada, “Canadian resource properties” (as defined in the Canadian Tax Act), “timber resource properties” (as defined in the Canadian Tax Act), or options in respect of or interests in such properties.
In certain other circumstances, a Common Share may be deemed to be “taxable Canadian property” for purposes of the Canadian Tax Act.
This summary is based on the current provisions of the Canadian Tax Act and the Convention in effect on the date hereof, all specific proposals to amend the Canadian Tax Act and Convention publicly announced by or on behalf of the Minister of Finance (Canada) on or before the date hereof, and the current published administrative and assessing policies of the CRA. It is assumed that all such amendments will be enacted as currently proposed, and that there will be no other material change to any applicable law or administrative or assessing practice, although no assurance can be given in these respects.
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Except as otherwise expressly provided, this summary does not take into account any provincial, territorial or foreign tax considerations, which may differ materially from those set out herein.
This summary is of a general nature only, is not exhaustive of all possible Canadian federal income tax considerations and is not intended to be and should not be construed as legal or tax advice to any particular U.S. Resident Holder. U.S. Resident Holders are urged to consult their own tax advisers for advice with respect to their particular circumstances. The discussion below is qualified accordingly.
A U.S. Resident Holder who disposes or is deemed to dispose of one or more Common Shares generally should not thereby incur any liability for Canadian federal income tax in respect of any capital gain arising as a consequence of the disposition.
A U.S. Resident Holder to whom Vista pays or is deemed to pay a dividend on the holder’s Common Shares will be subject to Canadian withholding tax, and Vista will be required to withhold the tax from the dividend and remit it to the CRA for the holder’s account. The rate of withholding tax under the Canadian Tax Act is 25% of the gross amount of the dividend (subject to reduction under the provisions of an applicable tax treaty). Under the Convention, a U.S. Resident Holder who beneficially owns the dividend will generally be subject to Canadian withholding tax at the rate of 15 % (or 5%, if the U.S. Resident Holder who beneficially owns the dividend is a company that is not fiscally transparent and which owns at least 10% of the voting stock of Vista) of the gross amount of the dividend.
Certain United States Federal Income Tax Considerations for U.S. Residents
There may be material tax consequences to U.S. Residents in relation to an acquisition or disposition of Common Shares or other securities of the Company. U.S. Residents should consult their own legal, accounting and tax advisors regarding such tax consequences under United States, state, local or foreign tax law regarding the acquisition or disposition of our Common Shares or other securities, in particular, the tax consequences of the Company likely being a PFIC within the meaning of Section 1297 of the United States Internal Revenue Code. See the section “Item 1A. – Risk Factors – The Company is likely classified as a PFIC, which will likely have adverse U.S. federal income tax consequences for U.S. shareholders” above.
Unregistered Sales of Equity Securities
None.
Repurchase of Securities
During 2022, neither Vista nor any affiliate of Vista repurchased Common Shares of Vista registered under Section 12 of the Exchange Act.
NYSE American Corporate Governance
Section 110 of the NYSE American Company Guide permits the NYSE American to consider the laws, customs and practices of foreign issuers in relaxing certain NYSE American listing criteria, and to grant exemptions from NYSE American listing criteria based on these considerations. A company seeking relief under these provisions is required to provide written certification from independent local counsel that the non-complying practice is not prohibited by home country law. A description of the significant ways in which the Company’s governance practices differ from those followed by domestic companies pursuant to NYSE American standards is as follows:
Shareholder Meeting Quorum Requirement: The NYSE American minimum quorum requirement for a shareholder meeting is one-third of the outstanding shares of common stock. In addition, a company listed on the NYSE American is required to state its quorum requirement in its bylaws. The Company’s quorum requirement is set forth in its Articles under the laws of the Province of British Columbia, Canada. Under the Company’s Articles, the quorum for the transaction of business at the meeting is two or more shareholders entitled to vote at the meeting represented in person or by proxy.
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The foregoing is consistent with the laws, customs and practices in Canada.