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EXHIBIT 1.02
[SCOTIABANK LETTERHEAD]
February 4, 1998
Xx. X.X. Xxx
Vice President Finance and Chief Financial Officer
HYCROFT RESOURCES & DEVELOPMENT, INC.
000 Xxxxxxxxxxx Xxxxxx
Xxxxx 0000
Xxxxxx, XX
00000 XXX
Dear Xx. Xxx,
We refer to our discussions regarding amendments to the credit
agreement ("the Agreement") between The Bank of Nova Scotia ("the Bank") and
Hycroft Resources & Development, Inc. ("Hycroft") dated September 30, 1997. The
amendments are required as a result of: (i) the unwinding of gold xxxxxx
assigned to the Bank; (ii) repayment of US$4,500,000 of indebtedness to the
Bank; and (iii) release of proceeds of the unwound gold xxxxxx to Hycroft and
Vista Gold Corp. ("Vista").
We confirm that the Bank's consent to the transactions outlined
above is subject to the following:
a) Vista and Hycroft are to hedge 90,000 ozs. of gold production
during 1998 to achieve a gold price of no less than US$282 par
ounce. The Bank will hold a security interest in these hedge
contracts and trading counterparties will be notified of same.
b) Vista will provide cash collateral for letters of credit
aggregating C$54,000 issued by the Bank on behalf of Vista to the
provinces of British Columbia and Saskatchewan. Alternately, Xxxxx
will replace these letters of credit with cash bonds for the
beneficiaries.
o) Hycroft will repay its remaining indebtedness to the Bank in
instalments during 1998 as follows, on the last business day of
each month shown:
April - US$ 500,000 May - US$ 500,000
June - US$1,500,000 July - US$1,000,000
August - US$1,000,000 September - US$1,000,000
October - US$1,500,000 November - US$ 750,000
December - US$ 750,000
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d) Xxxxxxx will revise its mine plan for 1998 as shown on the
attached monthly forecast and cease mining operations in May this
year.
e) The Bank's security interest in Yamin Ltda. will remain in
effect until all indebtedness of Vista and Hycroft to the Bank is
retired.
Please return an executed copy of this letter to us to confirm
acceptance of the terms herein.
Yours very truly,
THE BANK OF NOVA SCOTIA
/s/ XXX XXXXXX
Xxx Xxxxxx
Relationship Manager
Confirmed and accepted,
HYCROFT RESOURCES & DEVELOPMENT, INC.
By: /s/ XX XXX
Title: VP Finance & CFO
Date: 2/5/98
VISTA GOLD CORP.
By: /s/ XXXXXXX X XXXXXXXX
Title: President
Date: 2/5/98
