ARRANGEMENT AND MERGER AGREEMENT

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ARRANGEMENT AND MERGER AGREEMENT

THIS AGREEMENT made as of the 22 ^nd  day of September, 2006,

BETWEEN:

VISTA GOLD CORP. , a company existing under the laws of the Yukon Territory with an address at Suite 5 - 7961 Shaffer Parkway, Littleton, Colorado, USA, 80127,

(" Vista ")

AND:

ALLIED NEVADA GOLD CORP. , a corporation existing under the laws of Delaware with an address at c/o Vista Gold Corp., Suite 5 - 7961 Shaffer Parkway, Littleton, Colorado, USA, 80127,

(" Newco ")

AND:

CARL PESCIO , an individual with an address at P.O. Box 5831, Elko, Nevada, USA, 89802,

(" Carl ")

AND:

JANET PESCIO , an individual with an address at P.O. Box 5831, Elko, Nevada, USA, 89802,

(" Janet ", and together with Carl, the " Pescios ")

WITNESSES THAT WHEREAS:

A.

The Pescios entered into a binding letter of intent (the " LOI ") with Vista dated July 6, 2006, as amended, pursuant to which, among other things:

(a)

Vista agreed to undertake a plan of arrangement pursuant to which its business would be reorganized to split certain Nevada mining properties and related assets described on Schedule B (the " Vista Nevada Assets ") from its other properties and related assets;

(b)

Vista agreed to marshall all of the Vista Nevada Assets into its wholly-owned subsidiary, Vista Gold Holdings Inc. (" Vista U.S. ") or subsidiaries wholly-owned by Vista U.S. (and remove any non-Nevada assets therefrom) and subsequently transfer all issued and outstanding shares of Vista U.S. and $25 million in cash to Newco in return for common shares of Newco; and

(c)

The Pescios agreed to transfer their interests in certain Nevada mining properties and related assets described on Schedule C (the " Pescio Nevada Assets ") to Allied Nevada Gold Holdings LLC (" LLC "), a limited liability company incorporated under the laws of Nevada with Newco as its sole member, in return for $15 million in cash and common shares of Newco.

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B.

The board of directors of Vista has determined that completing the foregoing transactions is in the best interests of Vista.

C.

The parties wish to enter into this Agreement to set out their mutual rights and obligations in respect of the transactions contemplated by the LOI.

D.

The transactions set forth in Section 2.1 under Step 2(b) (the " Formation Transaction ") are intended to qualify for U.S. federal income tax purposes as a single integrated transaction under the provisions of Section 351 of the United States Internal Revenue Code of 1986, as amended, the Treasury Regulations promulgated thereunder and other applicable U.S. federal income tax law.

E.

Pursuant to the Plan of Arrangement, the Vista Shareholders will exchange their existing Vista Shares for New Common Shares and common shares of Newco.

NOW THEREFORE , in consideration of the mutual covenants and agreements contained herein and other good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged by all parties, the parties agree as follows:

ARTICLE 1

INTERPRETATION

1.1   Definitions

        In this Agreement, including the Schedules hereto, unless there is something in the subject matter inconsistent therewith, the following terms will have the following meanings and grammatical variations of those terms will have corresponding meanings:

(a)

" Act " means the Yukon Business Corporations Act , including all regulations made thereunder, as amended or replaced from time to time, prior to the Effective Date;

(b)

" Affiliate " has the meaning attributed to that term in the Act;

(c)

" Agreement ", " hereof ", " hereunder " and similar expressions mean this agreement, including the recitals and Schedules hereto and includes any agreement or instrument supplementary or ancillary hereto;

(d)

" AMEX " means the American Stock Exchange;

(e)

" Appropriate Regulatory Approvals " means those sanctions, rulings, consents, orders, exemptions, permits and other approvals (including the lapse, without objection, of a prescribed time under a Law that states that a transaction may be implemented if a prescribed time lapses following the giving of notice without an objection being made) of Governmental Entities, regulatory agencies or self-regulatory organizations which are necessary in order to permit the transactions contemplated hereby to be completed;

(f)

" Arrangement " means an arrangement under the provisions of Section 195 of the Act on the terms and conditions set forth in this Agreement and the Plan of Arrangement and any amendment, variation or supplement thereto made in accordance with the terms of this Agreement and the Plan of Arrangement;

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(g)

" Articles of Arrangement " means the articles of arrangement of Vista in respect of the Arrangement that are required by the Act to be filed after the Final Order is granted;

(h)

" Business Day " means a day which is not a Saturday, Sunday or a day when commercial banks are not open for business in Vancouver, British Columbia;

(i)

" Circular " means the management information circular of Vista to be prepared and sent to Vista Securityholders in connection with the Vista Meeting;

(j)

" Claim " means any written claim or notice of any nature whatsoever, including any demand, dispute, notification of liability, notification of remediation work, order, obligation, debt, cause of action, action, suit, proceeding, litigation, arbitration, judgment, award or assessment;

(k)

" Contaminant " means any pollutants, explosives, dangerous goods and substances, underground or above ground storage tanks, deleterious substances, special waste, liquid waste, industrial waste, hauled liquid waste or waste of any other kind, toxic substances, hazardous wastes, hazardous materials, hazardous substances or contaminants or any other substance the storage, manufacture, disposal, handling, treatment, generation, use, transport or release into the environment of which is prohibited, controlled or regulated under any Environmental Law;

(l)

" Court " means the Supreme Court of the Yukon Territory;

(m)

" Dissent Rights " means the rights of dissent in respect of the Arrangement described in the Plan of Arrangement;

(n)

" Effective Date " means the date upon which a copy of the Final Order and the Articles of Arrangement are accepted for filing under the Act and the Registrar of Corporations has issued a Certificate of Amendment (by Arrangement) thereby giving effect to the Arrangement;

(o)

" Effective Time " has the meaning ascribed thereto in the Plan of Arrangement;

(p)

" Encumbrance " means any mortgage, lien, charge, restriction, legal notation, claim, security interest, adverse claim, pledge, hypothecation, demand, pre-emptive right, encumbrance or any other rights of others;

(q)

" Environmental Activity " means any activity, event or circumstance in respect of a Contaminant, including, without limitation, its storage, use, holding, collection, purchase, accumulation, assessment, generation, manufacture, construction, processing, treatment, stabilization, disposition, handling or transportation, or its Release, escape, leaching, dispersal or migration into the natural environment, including the movement through or in the air, soil (land surface or subsurface strata), surface water or groundwater;

(r)

" Environmental Law " means any and all Laws in effect on the date hereof relating to pollution or the environment or any Environmental Activity;

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(s)

" Environmental Permits " means, collectively, all permits, licences, certificates, variances, remediation orders and authorizations of or any registration with, any Government Entity pursuant to any Environmental Law;

(t)

" Final Order " means the final order of the Court approving the Arrangement as such order may be amended by the Court (with the consent of Vista and the Pescios) at any time prior to the Effective Date or, if appealed, then, unless such appeal is withdrawn or denied, as affirmed or as amended on appeal;

(u)

" GAAP " means Canadian generally accepted accounting principles from time to time that meet the standards established by the Canadian Institute of Chartered Accountants;

(v)

" Governmental Entity " means any (i) multinational, federal, provincial, state, regional, municipal, local or other government, governmental or public department, central bank, court, tribunal, arbitral body, commission, board, bureau or agency, domestic or foreign, (ii) subdivision, agent, commission, board, or authority of any of the foregoing, or (iii) quasi-governmental or private body exercising any regulatory, expropriation or taxing authority under or for the account of any of the foregoing;

(w)

" Interim Order " means the interim order of the Court pursuant to the Act, as such order may be amended, supplemented or varied by the Court, in respect of the Arrangement as contemplated by Section 2.7;

(x)

" Law " means all statutes, regulations, statutory rules, policies, orders, and terms and conditions of any grant of approval, permission, authority or license of any court, Governmental Entity, statutory body (including the TSX and AMEX) or self-regulatory authority, and the term "applicable" with respect to such Law and in the context that refers to one or more Persons, means that such Law applies to such Person or Persons or its or their business, undertaking, property or securities and emanates from a Governmental Entity, statutory body or regulatory authority having jurisdiction over the Person or Persons or its or their business, undertaking, property or securities;

(y)

" Lien " means any mortgage, hypothec, prior claim, lien, pledge, assignment for security, security interest, lease, option, right of third parties or other charge or encumbrance, including the lien or retained title of a conditional vendor, and any easement, servitude, right of way or other encumbrance on title to real or immovable property or personal or movable property;

(z)

" LLC " has the meaning given thereto in Recital A;

(aa)

" LOI " has the meaning given thereto in Recital A;

(bb)

" Mailing Date " means October 12, 2006 or as soon thereafter as is practicable;

(cc)

" Material Adverse Change " means:

(i)

when used in connection with Vista U.S., means any change, event, occurrence or change in state of facts with respect to its condition (financial or otherwise), properties, assets, liabilities, obligations (whether absolute, accrued, conditional or otherwise), businesses, operations or results of operations or those of its Subsidiaries that is, or would reasonably be expected to be, material and adverse to the business, operations or financial condition of such party and its Subsidiaries taken as a whole, other than any change, event or occurrence: (A) relating to the Canadian or the United States' economy or financial, currency exchange, securities or commodity markets in general; or (B) related to the Arrangement or the public announcement thereof, and

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(ii)

when used in connection with the Pescio Nevada Assets means any change, event, occurrence or change in state of facts with respect to the ownership, status or condition of such assets (financial or otherwise) that is, or would reasonably be expected to be, material and adverse to the aggregate value of such assets in the hands of Newco, other than any change, event or occurrence: (A) relating to the Canadian or the United States' economy or financial, currency exchange, securities or commodity markets in general; or (B) related to the Arrangement or the public announcement thereof;

(dd)

" Material Adverse Effect " means any effect or state of facts that is, or would reasonably be expected to be, material and adverse to the value of either the Vista Nevada Assets in the aggregate or the Pescio Nevada Assets in the aggregate, as the case may be, in the hands of Newco;

(ee)

" Meeting Date " means November 15, 2006 or as soon thereafter as is practicable in compliance with the Interim Order;

(ff)

" Misrepresentation " has the meaning attributed to that term as at the date hereof in the Securities Act;

(gg)

" New Common Shares " has the meaning attributed thereto in the Plan of Arrangement;

(hh)

" Option Shares " has the meaning attributed thereto in the Plan of Arrangement;

(ii)

" PCBs " means polychlorinated biphenyls;

(jj)

" Permitted Encumbrances " means: (i) in the case of Vista, the list of encumbrances identified as "Permitted Encumbrances" in the Vista Disclosure Letter; and (ii) in the case of the Pescios, the list of encumbrances identified as "Permitted Encumbrances" in the Pescio Disclosure Letter;

(kk)

" Person " includes any individual, firm, partnership, joint venture, venture capital fund, limited liability company, unlimited liability company, association, trust, trustee, executor, administrator, legal personal representative, estate, group, body corporate, corporation, unincorporated association or organization, Governmental Entity, First Nation, syndicate or other entity, whether or not having legal status;

(ll)

" Pescio Contracts " has the meaning given thereto in Section 3.3(e)(ii);

(mm)

" Pescio Disclosure Letter " means the letter dated as of the date hereof delivered by the Pescios to Vista;

(nn)

" Pescio Lands " has the meaning given thereto in Section 3.3(e)(i);

(oo)

" Pescio Licences " has the meaning given thereto in Section 3.3(e)(iii);

(pp)

" Pescio Nevada Assets " has the meaning given thereto in Recital A;

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(qq)

" Pescio Required Consents " means the third party consents required to be obtained by either of the Pescios pursuant to the terms of existing contracts with such third parties in connection with the transactions contemplated hereby, as described in Schedule E hereto;

(rr)

" Pescios " has the meaning given thereto in Recital A;

(ss)

" Plan of Arrangement " means the plan of arrangement substantially in the form and content as set out in Schedule A hereto and any amendments or variations thereto made in accordance with the terms hereof, the Plan of Arrangement or made at the direction of the Court (with the consent of the parties, acting reasonably) in the Final Order;

(tt)

" Pre-Effective Date Period " shall mean the period from and including the date hereof to and including the Effective Time;

(uu)

" Release " means discharge, spray, inject, inoculate, abandon, deposit, spill, leak, seep, migrate, pour, emit, empty, throw, dump, place or exhaust, and when used as a noun has a similar meaning;

(vv)

" Securities Legislation " means the Securities Act and the equivalent Law in the other provinces of Canada and in the United States, and the published instruments and rules of any Governmental Entity administering those statutes, as well as the rules, regulations, by-laws and policies of the TSX or the AMEX, as applicable;

(ww)

" Securities Act " means Securities Act (British Columbia), as now in effect and as it may be amended from time to time prior to the Effective Date;

(xx)

" Subsidiary " means a "subsidiary" as defined in the Act;

(yy)

" Termination Date " means February 28, 2007 or any later date as may be agreed to in writing by Vista and the Pescios;

(zz)

" TSX " means the Toronto Stock Exchange;

(aaa)

" U.S. Tax Code " means the United States Internal Revenue Code of 1986, as amended, or any successor thereto;

(bbb)

" Vista Contracts " has the meaning given thereto in Section 3.1(g)(ii);

(ccc)

" Vista Disclosure Letter " means the letter dated as of the date hereof delivered by Vista to the Pescios;

(ddd)

" Vista Lands " has the meaning given thereto in Section 3.1(g)(i);

(eee)

" Vista Licences " has the meaning given thereto in Section 3.1(g)(iii);

(fff)

" Vista Meeting " means the special meeting of the Vista Securityholders (including any adjourned or postponed meeting) to be held for the purpose of considering and, if deemed advisable, approving the Vista Resolutions;

(ggg)

" Vista Nevada Assets " has the meaning given thereto in Recital A;

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(hhh)

" Vista Resolutions " means the resolutions of the Vista Securityholders approving the Arrangement in accordance with the Act as contemplated herein, such resolutions to be substantially in the form and content as set out in the Circular;

(iii)

" Vista Required Consents " means the third party consents required to be obtained by Vista or Vista U.S. pursuant to the terms of existing contracts with such third parties in connection with the transactions contemplated hereby, as described in Schedule D hereto;

(jjj)

" Vista Securities " means the Vista Shares, the Vista Options and the Vista Warrants;

(kkk)

" Vista Securityholders " means the Vista Shareholders, the holders of Vista Stock Options and the holders of Vista Warrants;

(lll)

" Vista Shareholder " means a holder of Vista Shares (including, without limitation, the Vista Shares issued in the Financing (as defined in Section 2.1)) shown from time to time in the register maintained by or on behalf of Vista in respect of Vista Shares;

(mmm)

" Vista Shares " means the common shares in the capital of Vista;

(nnn)

" Vista Stock Options " means the options (whether or not vested) to purchase Vista Shares that are from time to time outstanding under the Vista Stock Option Plans;

(ooo)

" Vista U.S. " has the meaning given thereto in Recital B; and

(ppp)

" Vista Warrants " means all of the outstanding warrants to acquire Vista Shares.

1.2   Interpretation Not Affected by Headings, etc.

        The division of this Agreement into Articles, Sections and other portions and the insertion of headings are for convenience of reference only and shall not affect the construction or interpretation hereof. Unless otherwise indicated, all references to an "Article" or "Section" followed by a number and/or a letter refer to the specified Article or Section of this Agreement. The terms "this Agreement", "hereof", "herein" and "hereunder" and similar expressions refer to this Agreement (including the Schedules hereto) and not to any particular Article, Section or other portion hereof and include any agreement or instrument supplementary or ancillary hereto.

1.3   Number and Gender

        In this Agreement, unless the context otherwise requires, words used herein importing the singular include the plural and vice versa and words importing gender include all genders.

1.4   Date of Any Action

        In the event that any date on which any action is required to be taken hereunder by any of the parties hereto is not a Business Day, such action shall be required to be taken on the next succeeding day which is a Business Day.

1.5   Currency

        Unless otherwise stated, all references in this Agreement to sums of money are expressed in lawful money of the United States.

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1.6   Knowledge

        Each reference herein to the knowledge of a party means, unless otherwise specified, the existing knowledge of any vice-president or more senior officer of such party (or, in the case of the Pescios, either of them) without inquiry.

1.7   Statutory References

        Any reference in this Agreement to a statute includes all rules and regulations made thereunder, all amendments to that statute or the rules and regulations made thereunder in force from time to time, and any statute or rule or regulation that supplements or supersedes that statute or the rules or regulations made thereunder.

1.8   Entire Agreement

        This Agreement and the other agreements and documents referred to herein, constitute the entire agreement between the parties hereto pertaining to the terms of the Arrangement and ancillary arrangements and supersede all other prior agreements, understandings, negotiations and discussions, whether oral or written, between the parties hereto with respect to the terms of the Arrangement and such arrangements. For greater certainty, the parties hereby terminate the LOI, such termination to be effective upon the execution and delivery of this Agreement.

1.9   Accounting Matters

        Unless otherwise stated, all accounting terms used in this Agreement shall have the meanings attributable thereto under GAAP and all determinations of an accounting nature required to be made hereunder in respect of any party shall be made in a manner consistent with GAAP as historically applied by such party.

1.10 Schedules

        The following are the Schedules to this Agreement, which form an integral part hereof:

        Schedule A:        Plan of Arrangement

        Schedule B:        Vista Nevada Assets

        Schedule C:        Pescio Nevada Assets

        Schedule D:        Vista Required Consents

        Schedule E:        Pescio Required Consents

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ARTICLE 2

THE TRANSACTIONS

2.1   Steps Involved in Transaction

        The parties agree that, subject to the terms hereof, they will take all steps necessary or desirable to cause the following steps to occur in the following order:

Step 1: Pre-Closing Reorganization by Vista

        Prior to the Effective Time, Vista will use commercially reasonable efforts to:

(a)

ensure all Vista Nevada Assets are held by Vista U.S., or subsidiaries wholly-owned by Vista U.S. and that all assets which are not Vista Nevada Assets have been transferred out of such entities; and

(b)

complete a public equity financing (the " Financing ") pursuant to which it will raise no less than $25 million on terms satisfactory to Vista, acting reasonably.

Step 2: Closing of Arrangement and Related Transactions

        At the Effective Time, Vista and the Pescios will take all steps necessary or desirable to ensure that:

(a)

the Arrangement is effected in accordance with its terms; and

(b)

the following steps occur concurrently at the same time as the Arrangement is being effected:

(i)

Vista will transfer: (A) all of the shares of Vista U.S. which it then holds; and (B) $25 million in cash, to Newco in return for 27,500,000 common shares of Newco, less the number of Option Shares; and

(ii)

the Pescios will transfer all of their interest in the Pescio Nevada Assets to Nevada LLC in return for $15 million in cash and 12,000,000 common shares of Newco.

2.2   Treatment of Vista Optionholders

        The parties acknowledge that, concurrently with the completion of the Arrangement, all holders of existing Vista Stock Options will exchange such options for:

(a)

new options to acquire New Common Shares; and

(b)

new options to acquire common shares of Newco.

 

        The parties intend that after exchanging existing Vista Stock Options for new options as set forth above, such optionholders will, as closely as possible, be in the same economic position as they are immediately prior to such exchange. The number of options to be granted, and the exercise price for such options, will be determined as described in the Plan of Arrangement.

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2.3   Vista Warrantholders

        The parties acknowledge that no special arrangements will be made in respect of the holders of any existing Vista Warrants but that, concurrently with the completion of the Arrangement, the exercise price and/or number of New Common Shares purchasable thereunder will be adjusted in accordance with the terms governing such Vista Warrants.

2.4   Implementation Steps by Vista

        Vista covenants in favour of the Pescios that Vista shall:

(a)

as soon as reasonably practicable taking into account the proposed Mailing Date, apply under the Act for the Interim Order in a manner consistent with this Agreement, and thereafter proceed with and diligently seek the Interim Order;

(b)

subject to receipt of the Interim Order and the mailing of the Circular, convene and hold the Vista Meeting on the Meeting Date for the purpose of considering and, if deemed advisable, approving the Vista Resolutions (and for any other proper purpose relating to the Arrangement as may be set out in the notice for the Vista Meeting);

(c)

if: (i) at the Vista Meeting the approval of the Vista Resolutions in accordance with the Interim Order (including any variation thereof approved by Vista and the Pescios) is obtained; (ii) any other approvals required by the Interim Order (including any variation thereof approved by Vista and the Pescios) are obtained, as soon as reasonably practicable thereafter, apply to the Court for the Final Order on such terms as the Court may direct and Vista and the Pescios may agree and proceed with and diligently seek the Final Order; and

(d)

if the Final Order is obtained, on a date and time agreed with the Pescios, acting reasonably, subject to the fulfillment or waiver of each of the conditions set forth herein, file a copy of the Final Order and the Articles of Arrangement, together with any other actions or documentation as may be required in connection therewith, to give effect to the Arrangement pursuant to the Act and to otherwise complete the transactions contemplated hereby before the Termination Date.

2.5   Implementation Steps by the Pescios

        Each of the Pescios covenants in favour of Vista that he or she shall cooperate fully with Vista and provide all requested assistance in connection with Vista seeking the Interim Order and the Final Order and otherwise in completing the transactions contemplated hereby.

2.6   Implementation Steps by Newco

        Newco covenants in favour of both Vista and the Pescios covenants that it will cooperate fully with Vista and provide all requested assistance in connection with Vista seeking the Interim Order and the Final Order and otherwise in completing the transactions contemplated hereby.

2.7   Interim Order

        The application for the Interim Order shall request that such order provide for the holding of a meeting of Vista Securityholders pursuant to the Act and:

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(a)

for the class of Persons (which shall include the Vista Securityholders) to whom notice is to be provided in respect of the Arrangement and the Vista Meeting and for the manner in which such notice is to be provided;

(b)

that the requisite approval for the Vista Resolutions shall be two-thirds of the votes cast on the Vista Resolutions by Vista Securityholders present in person or by proxy at the Vista Meeting voting together as a single class (such that each holder of Vista Shares is entitled to one vote for each Vista Share held and each holder of Vista Options or Vista Warrants is entitled to one vote for each Vista Share issuable upon exercise of the Vista Options or Vista Warrants held);

(c)

that, in all other respects, the terms, restrictions and conditions of the articles of Vista, including quorum requirements and all other matters, and the provisions of applicable Law shall apply in respect of the Vista Meeting;

(d)

for the grant of the Dissent Rights; and

(e)

for the notice requirements with respect to the presentation of the application to the Court of the Final Order.

2.8   Plan of Arrangement

        The parties to this Agreement will implement the Plan of Arrangement in accordance with the provisions of this Agreement including Schedule A of this Agreement.

2.9   Circular

        Vista and each of the Pescios shall proceed diligently in a co-ordinated manner using commercially reasonable efforts to jointly prepare as quickly as possible the Circular together with any other documents required by the Securities Act or other applicable Law in connection with the Arrangement and the Vista Meeting for mailing by the Mailing Date. In particular, the Pescios agree to provide Vista with all information relating to themselves or the Pescio Nevada Assets as may be required to permit Vista to complete the Circular in accordance with the requirements of applicable Law.

        Vista and each of the Pescios shall ensure that the information relating to them which is provided in the Circular does not contain any Misrepresentation. Vista and each of the Pescios agrees to promptly notify the other parties hereto if, at any time during the Pre-Effective Date Period, it, he or she becomes aware that the Circular contains a Misrepresentation. In such event, Vista and the Pescios shall co-operate in the preparation of a supplement or amendment to the Circular, as the case may be, that corrects that Misrepresentation, and will cause the same to be distributed to the Vista Securityholders and filed with each applicable Governmental Entity under applicable Law.

        Vista shall cause the Circular and any other documentation required in connection with the Vista Meeting to be sent to each Vista Securityholder as soon as reasonably practicable following receipt of the Interim Order and to be filed, in each case, as required by the Interim Order and applicable Law.

2.10 Board Recommendation

        Vista confirms that, as of the date hereof, its board of directors has unanimously approved this Agreement and the transactions contemplated hereby. The board of directors has also determined, after consultation with its financial advisors, that the transactions contemplated hereby are fair, from a financial point of view, to the Vista Shareholders as of the date hereof and has resolved to unanimously recommend approval of such transactions by the Vista Securityholders. The Circular will set forth (among other things) the recommendation of the board of directors of Vista as described above and will include the fairness opinion of Sprott Securities Inc.

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2.11 Preparation of Filings

        Vista and the Pescios shall cooperate in:

(a)

the preparation and filing of any application for the orders and the preparation of any required documents reasonably deemed by Vista to be necessary to discharge their respective obligations under applicable Securities Legislation in connection with the Arrangement and the other transactions contemplated hereby;

(b)

the taking of all such action as may be required under applicable Securities Legislation in connection with the issuance of the securities of Newco in connection with the Arrangement; and

(c)

the taking of all such action as may be required under the Act in connection with the transactions contemplated by this Agreement and the Plan of Arrangement.

2.12 U.S. Tax Treatment

        The Formation Transaction is intended to qualify as a single integrated transaction within the meaning of Section 351 of the U.S. Tax Code and the Treasury Regulations promulgated thereunder. Each party hereto agrees to treat the Formation Transaction as a single integrated transaction within the meaning of Section 351 of the U.S. Tax Code for all U.S. federal income tax purposes, and to not take any position on any tax return or other tax filing or otherwise take any tax reporting position inconsistent with such treatment, unless otherwise required by a "determination" within the meaning of Section 1313 of the U.S. Tax Code that such treatment is not correct. Each party hereto agrees to act in good faith, consistent with the intent of the parties and the intended treatment of the Arrangement as set forth in this Section 2.11.

ARTICLE 3

REPRESENTATIONS AND WARRANTIES

3.1   Representations and Warranties of Vista

        Vista hereby makes the following representations and warranties to each of the Pescios and Newco and acknowledges that such parties are relying upon such representations and warranties in connection with the matters contemplated by this Agreement:

(a)

Corporate Status  — each of Vista and Vista U.S. is duly incorporated and is validly existing as a company in good standing under the laws of their respective jurisdictions of incorporation and has the necessary corporate power and capacity to own its property and assets, to carry on its business as now being conducted by it and to carry out the transactions contemplated by this Agreement. In addition, immediately prior to the Effective Time, LLC will be duly organized and validly existing as a limited liability company under the laws of Nevada.

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(b)

Ownership of Vista U.S. and LLC  — Immediately prior to the Effective Time:

(i)

Vista will be the registered and beneficial owner of all issued and outstanding shares of Vista U.S. and no other party will hold any right to purchase shares of Vista U.S. or securities convertible into shares of Vista U.S.; and

(ii)

Newco will be the sole member of LLC.

(c)

Due Authorization  — the execution and delivery of this Agreement and the other documents to be executed and delivered by Vista, Vista U.S. and LLC hereunder, and the carrying out of the transactions contemplated hereby on the part of each such party, have been duly authorized by all necessary corporate action on the part of each of Vista, Vista U.S. and LLC.

(d)

No Conflicts or Violations  — neither the entering into of this Agreement nor the other documents to be executed and delivered by any of Vista, Vista U.S. or LLC, nor the completion of the transactions contemplated hereby in accordance with the terms hereof will result in:

(i)

a violation or breach of any provision of or a default (or an event that with notice or lapse of time or both could constitute a default) under, or give to others any right of termination, amendment, acceleration or cancellation of or under:

A.

the constating or organizational documents of any of Vista, Vista U.S. or LLC, including any resolutions of their respective shareholders or directors;

B.

any applicable Law, to the best of Vista's knowledge;

C.

any material agreement, arrangement or understanding to which either of Vista, Vista U.S. or LLC is a party or by which either one of them or their properties are bound or affected,

subject to obtaining all of the Vista Required Consents, or

(ii)

the imposition of any material Encumbrance upon any of the Vista Nevada Assets.

(e)

Required Consents  — except as set forth in Schedule D to this Agreement, the execution, delivery of this Agreement, the performance of their obligations hereunder and the completion of the transactions contemplated by this Agreement will not require Vista, Vista U.S. or LLC to obtain any consent, authorization or approval or order-in council of, or make any filing with or give any notice to, any Person.

(f)

Title to Assets  — on the Effective Date immediately prior to the Effective Time, Vista U.S. and its Subsidiaries will together legally and beneficially own, hold or be entitled to the benefit of the Vista Nevada Assets, free and clear of all material Encumbrances other than the Permitted Encumbrances.

(g)

Description of Vista Nevada Assets  — Schedule B accurately describes all of the material Vista Nevada Assets including, without limitation:

13

(i)

all material real property and mineral interests held by Vista U.S., including a description of the nature of the interest held (the " Vista Lands ");

(ii)

all agreements and other contracts material to the operation of the business of Vista U.S. and its Subsidiaries (collectively the " Vista Contracts "); and

(iii)

all licenses, permits, authorities and permissions held by Vista U.S. or its subsidiaries which are material to the operation of those entities as a whole (collectively the " Vista Licences ").

(h)

No Other Contracts  — except for the Vista Contracts and Vista Licences, neither Vista U.S. nor any of its subsidiaries (including LLC) will as of the Effective Date be a party to, be bound by, or be an assignee under, any contract, agreement or commitment of any kind other than contracts which are not material to the operation of the business of Vista U.S. and its subsidiaries, considered as a whole, that have been entered into in the ordinary and usual course of business consistent with past practice.

(i)

No Defaults  — except as may be set out in the Vista Disclosure Letter, the Vista Contracts and Vista Licences are in full force and effect and no party thereto is in default in any respect under, and there exists no event, condition or occurrence known to Vista which, after notice or lapse of time or both would constitute such a default by any party under, any Vista Licence or Vista Contract.

(j)

Litigation  — except as set out in the Vista Disclosure Letter, there is no action, suit, order, work order, petition, prosecution or other similar proceeding (whether or not purportedly on its behalf), pending or, to the best of the knowledge of Vista, threatened against any such party and affecting Vista U.S. or the Vista Nevada Assets at law or in equity or before or by any Governmental Entity, domestic or foreign.

(k)

Environmental Matters  — except as disclosed in the Vista Disclosure Letter:

(i)

Compliance with Environmental Laws  — Vista and Vista U.S. have, and the operation of their business has, at all times, been and continues to be in compliance in all material respects with all Environmental Laws which apply to the Vista Nevada Assets;

(ii)

Environmental Permits  — Vista U.S. or its subsidiaries together will, as of the Effective Date, hold (legally or beneficially) all material Environmental Permits required in connection with the Vista Nevada Assets, and all such permits shall be transferred to Newco. All such Environmental Permits are in good standing and are being and have been complied with in all material respects. No proceeding is pending or threatened and no steps have been taken by any Governmental Entity or other person to revoke, modify or limit any of the Environmental Permits and, to the best of the knowledge of Vista, no grounds exist for any such proceeding or steps;

(iii)

Activities  — neither Vista nor Vista U.S. has in connection with the use of the Vista Lands, released, transported, treated, processed, distributed, stored, used, manufactured, handled, disposed of or exposed its employees or other persons to Contaminants or caused, authorized or permitted any of the foregoing except in material compliance with all applicable Environmental Laws;

14

(iv)

Condition of Property Interests  — neither Vista nor Vista U.S. has any notice or knowledge that the Vista Lands contain any Contaminants except in levels permitted under Environmental Laws. To the best of the knowledge of Vista, no Contaminants have been or are being released on or from or migrating through property adjoining or in the vicinity of the Vista Lands that might migrate to or affect the Vista Lands;

(v)

Landfills  — to the best of Vista's knowledge, there are no landfills or disposal areas on any of the Vista Lands and there are no landfills or disposal areas that have been or are being used by either of Vista or Vista U.S. on the Vista Lands;

(vi)

Tanks and PCB's  — to the best of Vista's knowledge, there are no and there never have been any underground storage tanks located on any of the Vista Lands or PCB's or equipment containing PCB's used or stored on the Vista Lands;

(vii)

Environmental Undertakings  — neither Vista nor Vista U.S. or any of their Affiliates has at any time given any written undertakings with respect to remedying any breach of, or liability under, Environmental Laws or Environmental Permits with respect to the Vista Nevada Assets that have not been duly performed in all material respects;

(viii)

Claims  — there are no outstanding, or to the best of the knowledge of Vista, pending or threatened Claims against Vista, Vista U.S. or any of their Affiliates with respect to the environmental condition of any of the Vista Lands or alleging any breach of, default or liability under Environmental Laws with respect to the Vista Nevada Assets, or relating to the presence of any Contaminant or a release or a threat of a release of any Contaminant on, at, from or to any Vista Lands or relating to exposure of any Person to any Contaminant and to the best of the knowledge of Vista, no facts exist which could give rise to any such Claim; and

(ix)

Environmental Disclosure  — Vista has fully disclosed to Newco and the Pescios all environmental reports, site assessments, audits, studies, evaluations, tests and records in the possession or control of such parties with respect to the Vista Nevada Assets and fully disclosed to Newco and the Pescios all material facts and circumstances known to such parties relating to the environmental condition of the Vista Nevada Assets.

(l)

Compliance with Laws  — except for any conflicts, defaults or violations which would not, individually or in the aggregate, have a Material Adverse Effect on Vista U.S. or the Vista Nevada Assets, or as disclosed in Vista Disclosure Letter, neither Vista nor Vista U.S. has received or is aware of any notice from any Governmental Entity that it is in conflict with, or in default or violation of, any zoning requirement, bylaw, law, rule, regulation, order, permit, judgment or decree applicable to such party or by which any of the Vista Nevada Assets is bound or affected.

(m)

Disclosure in Circular  — the disclosure in the Circular relating to Vista, Vista U.S., Newco and LLC and the Vista Nevada Assets will be true and complete in all material respects, will not contain any Misrepresentations and will, in all material respects, constitute sufficient disclosure so as to meet the requirements of applicable Law in respect of such disclosure.

15

(n)

Full Disclosure  — All material information pertaining to the Vista Nevada Assets has been made available to Newco and the Pescios and, to the knowledge of Vista, no event or circumstance exists other than:

(i)

market conditions or other conditions affecting the industry generally; or

(ii)

events or circumstances specific to Newco, the Pescios or the Pescio Nevada Assets,

which has or could reasonably be expected to result in a material adverse effect on the value of the Vista Nevada Assets to Newco.

(o)

U.S. Tax Matters  — Neither Vista nor any affiliate of Vista (including, without limitation, Vista U.S.) has taken or agreed to take any action (without regard to any action taken or agreed to be taken by either of the Pescios) or knows of any circumstances that would prevent the Formation Transaction from qualifying as a single integrated transaction within the meaning of Section 351 of the U.S. Tax Code. Upon completion of the transactions contemplated by this Agreement, Vista, Vista Shareholders and the Pescios, in the aggregate, shall hold 100% of the issued and outstanding shares of common stock of Newco, and on a fully diluted basis (assuming the exercise of all rights to acquire Newco stock, including the options described in Section 2.2), shall hold more than 95% of the issued and outstanding shares of common stock of Newco. The transaction contemplated in Step 1 of Section 2.1 above shall not result in any tax liability to Newco, Vista U.S. or any entities which are currently or will, as a result of the transactions contemplated hereby, become direct or indirect subsidiaries of Newco or Vista U.S.

(p)

SEC Registration  — The Vista Shares are registered pursuant to Section 12 of the United States Securities Exchange Act of 1934, as amended (the " 1934 Act "), and Vista has filed with the United States Securities and Exchange Commission (the " SEC ") and made available to the Pescios all of its reports and other documents required to be filed by Vista with or furnished by Vista to the SEC pursuant to the 1934 Act or the United States Securities Act of 1933 (the " 1933 Act ") since January 1, 2003 (collectively, " Vista's SEC Documents "). As of its respective date (giving effect to amendments and modifications filed or furnished prior to September 21, 2006), each of Vista's SEC Documents complied with the requirements of the 1934 Act and the 1933 Act (as applicable) and the rules and regulations of the SEC thereunder and did not contain any untrue statement of material fact or omit to state any material fact required to be stated therein or necessary to make the statements therein, in the light of the circumstances under which they were made, not misleading. The financial statements (including the related notes) of Vista included in Vista's SEC Documents comply in all material respects with the applicable accounting requirements and the published rules and regulations of the SEC with respect thereto, and are reconciled to United States generally accepted accounting principles (" U.S. GAAP ") to the extent required by and in accordance with Regulation S-X of the SEC, and fairly present in all material respects the consolidated financial position of Vista and its consolidated subsidiaries as of the dates thereof and their consolidated results of operations and cash flows for the periods then ended (subject, in the case of unaudited statements, to normal and recurring year-end audit adjustments). As of September 21, 2006, Vista's SEC Documents, taken as a whole, do not contain any untrue statement of a material fact or omit to state a material fact required to be stated therein or necessary in order to make the statements therein, in light of the circumstances under which they were made, not misleading. The Vista Shares are listed for trading on the TSX and the AMEX and Vista is in compliance with the rules of the TSX and AMEX.

16

(q)

Investment Company  — Vista is not an "investment company" within the meaning of the United States Investment Company Act of 1940, as amended.

(r)

Off-Balance Sheet Arrangements  — Other than as described in Vista's Annual Report on Form 10-K for the fiscal year ended December 31, 2005, Vista does not have any "off-balance sheet arrangements" as such term is defined in the rules of the SEC.

(s)

Hart-Scott-Rodino  — Vista is its own "ultimate parent entity" (as defined in 16 C.F.R. § 801.1(a)(3)) and Vista, together with all entities controlled (as defined in 16 C.F.R. § 801.(1)(b)) by it (a) did not for its fiscal year ended December 31, 2005 have aggregate sales of $113.4 million or more, or (b) as of June 30, 2006 (being the date of its most recent regularly prepared balance sheet) does not, and as of the Effective Time will not, hold assets having an aggregate total value of $113.4 million or more, in each case determined in accordance with 16 C.F.R. § 801.11 (this representation and warranty being made solely for the purpose of determining the applicability of the notification provisions of the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended to the transactions contemplated by this agreement).

(t)

Loans  — Since July 30, 2002, Vista has not directly or indirectly, including through any of its subsidiaries: (A) extended credit, arranged to extend credit, or renewed any extension of credit, in the form of a personal loan, to or for any director or executive officer of Vista, or to or for any family member or affiliate of any director or executive officer of Vista; or (B) made any material modification, including any renewal thereof, to any term of any personal loan to any director or executive officer of Vista, or any family member or affiliate of any director or executive officer, which loan was outstanding on July 30, 2002. Neither Vista nor any of its subsidiaries has any outstanding loans to or extensions of credit to, or any guarantee of any indebtedness of, any employee, officer or director of Vista or any of its subsidiaries.

(u)

Sarbanes-Oxley Act  — Vista is in full compliance with all provisions of the United States Sarbanes-Oxley Act of 2002 that are currently applicable to it, and has no reason to believe that it will not be in timely compliance with any provision thereof which is presently scheduled to become applicable to it in the future.

3.2   Vista Disclosure Letter

        The parties acknowledge that, concurrently with the execution and delivery hereof, Vista has delivered the Vista Disclosure Letter to the Pescios and that such document describes a series of exceptions to, or an exclusions from, the representations and warranties described in Section 3.1 above and that such exceptions and exclusions are deemed to be incorporated into this Agreement.

3.3   Representations and Warranties of the Pescios

        Each of the Pescios hereby jointly and severally makes to Vista and Newco the following representations and warranties and acknowledges that such parties are relying upon such representations and warranties in connection with the matters contemplated by this Agreement.

17

(a)

Power and Capacity  — each of the Pescios has the power and capacity to enter into and deliver this Agreement and the other documents to be executed and delivered by them hereunder and to perform their respective obligations hereunder and thereunder.

(b)

No Conflicts or Violations  — neither the entering into of this Agreement nor the other documents to be executed and delivered by either of the Pescios, nor the completion of the transactions contemplated hereby in accordance with the terms hereof will result in:

(i)

a violation or breach of any provision of or a default (or an event that with notice or lapse of time or both could constitute a default) under, or give to others any right of termination, amendment, acceleration or cancellation of or under:

A.

any applicable Law, to the best of the Pescio's knowledge; or

B.

any material agreement, arrangement or understanding to which either of the Pescios is a party or by which any of them or the Pescio Nevada Assets are bound or affected,

subject to obtaining all of the Pescio Required Consents, or

(ii)

the imposition of any material Encumbrance upon any of the Pescio Nevada Assets.

(c)

Required Consents  — except as set forth in Schedule E to this Agreement, the execution, delivery of this Agreement, the performance of their obligations hereunder and the completion of the transactions contemplated by this Agreement will not require either of the Pescios to obtain any consent, authorization or approval or order-in council of, or make any filing with or give any notice to, any Person.

(d)

Title to Assets  — on the Effective Date immediately prior to the Effective Time, the Pescios will together legally and beneficially own, hold or be entitled to the benefit of the Pescio Nevada Assets, free and clear of all material Encumbrances other than the Permitted Encumbrances.

(e)

Description of Pescio Nevada Assets  — Schedule C accurately describes all of the material Pescio Nevada Assets including, without limitation:

(i)

all material real property and mineral interests in Nevada held by the Pescios, including a description of the nature of the interest held (the " Pescio Lands ");

(ii)

all agreements and other contracts material to the ownership and operation of the Pescio Lands (collectively the " Pescio Contracts "); and

(iii)

all licenses, permits, authorities and permissions held by either of the Pescios which are material to the ownership or operation of the Pescio Lands (collectively the " Pescio Licences ").

(f)

No Other Contracts  — except for the Pescio Contracts and Pescio Licences, neither of the Pescios will as of the Effective Date be a party to, be bound by, or be an assignee under, any contract, agreement or commitment of any kind relating to the Pescio Nevada Assets, other than contracts which are not material to the ownership or operations of the Pescio Nevada Assets.

18

(g)

No Defaults  — except as may be set out in the Pescio Disclosure Letter, the Pescio Contracts and Pescio Licences are in full force and effect and no party thereto is in default in any respect under, and there exists no event, condition or occurrence known to of the Pescios which, after notice or lapse of time or both would constitute such a default by any party under, any Pescio Licence or Pescio Contract.

(h)

Litigation  — except as set out in the Pescio Disclosure Letter, there is no action, suit, order, work order, petition, prosecution or other similar proceeding pending or, to the best of the knowledge of either of the Pescios, threatened against any such party and affecting the Pescio Nevada Assets at law or in equity or before or by any Governmental Entity, domestic or foreign.

(i)

Environmental Matters  — except as disclosed in the Pescio Disclosure Letter:

(i)

Compliance with Environmental Laws  — The Pescios have, at all times, dealt with the Pescio Nevada Assets in compliance in all material respects with all Environmental Laws which apply to such Pescio Nevada Assets;

(ii)

Environmental Permits  — The Pescios will, as of the Effective Date, hold (legally or beneficially) all material Environmental Permits required to be held by them, if any, in connection with the Pescio Nevada Assets, and any such permits shall be transferred to Newco. All such Environmental Permits are in good standing and are being and have been complied with in all material respects. No proceeding is pending or threatened and no steps have been taken by any Governmental Entity or other person to revoke, modify or limit any of the Environmental Permits and, to the best of the knowledge of the Pescios, no grounds exist for any such proceeding or steps;

(iii)

Activities  — neither of the Pescios has in connection with the use of the Pescio Lands, released, transported, treated, processed, distributed, stored, used, manufactured, handled, disposed of or exposed any Persons to Contaminants or caused, authorized or permitted any of the foregoing except in material compliance with all applicable Environmental Laws;

(iv)

Condition of Property Interests  — neither of the Pescios has any notice or knowledge that the Pescio Lands contain any Contaminants except in levels permitted under Environmental Laws. To the best of the knowledge of the Pescios, no Contaminants have been or are being released on or from or migrating through property adjoining or in the vicinity of the Pescio Lands that might migrate to or affect the Pescio Lands;

(v)

Landfills  — neither of the Pescios has any knowledge that there are any landfills or disposal areas on any of the Pescio Lands or any landfills or disposal areas that have been or are being used by either of the Pescios on the Vista Lands;

(vi)

Tanks and PCB's  — neither of the Pescios has any knowledge that there are any or have ever been any underground storage tanks located on any of the Pescio Lands or PCB's or equipment containing PCB's used or stored on the Pescio Lands;

(vii)

Environmental Undertakings  — neither of the Pescios has at any time given any written undertakings with respect to remedying any breach of, or liability under, Environmental Laws or Environmental Permits with respect to the Pescio Nevada Assets that have not been duly performed in all material respects;

19

(viii)

Claims  — there are no outstanding, or to the best of the knowledge of either of the Pescios, pending or threatened Claims against either of the Pescios with respect to the environmental condition of any of the Pescio Lands or alleging any breach of, default or liability under Environmental Laws with respect to the Pescio Nevada Assets, or relating to the presence of any Contaminant or a release or a threat of a release of any Contaminant on, at, from or to any Pescio Lands or relating to exposure of any Person to any Contaminant and to the best of the knowledge of either of the Pescios, no facts exist which could give rise to any such Claim; and

(ix)

Environmental Disclosure  — The Pescios have fully disclosed to Newco and Vista all environmental reports, site assessments, audits, studies, evaluations, tests and records in the possession or control of such parties with respect to the Pescio Nevada Assets and fully disclosed to Newco and Vista all material facts and circumstances known to such parties relating to the environmental condition of the Pescio Nevada Assets.

(j)

Compliance with Laws  — except for any conflicts, defaults or violations which would not, individually or in the aggregate, have a Material Adverse Effect on the Pescio Nevada Assets, or as disclosed in Pescio Disclosure Letter, neither of the Pescios has received or is aware of any notice from any Governmental Entity that any of the Pescio Nevada Assets is in conflict with, or in default or violation of, any zoning requirement, bylaw, law, rule, regulation, order, permit, judgment or decree applicable to such party or by which any of the Pescio Nevada Assets is bound or affected.

(k)

Disclosure in Circular  — the disclosure in the Circular relating to the Pescios and the Pescio Nevada Assets will be true and complete in all material respects, will not contain any Misrepresentations and will, in all material respects, constitute sufficient disclosure so as to meet the requirements of applicable Law in respect of such disclosure.

(l)

Full Disclosure  — All material information pertaining to the Pescio Nevada Assets has been made available to Newco and Vista and, to the knowledge of the Pescios, no event or circumstance exists other than:

(i)

market conditions or other conditions affecting the industry generally; or

(ii)

events or circumstances specific to Newco or Vista,

which has or could reasonably be expected to result in a material adverse effect on the value of the Pescio Nevada Assets to Newco.

(m)

Hart-Scott-Rodino  — The Pescios (as natural persons and as husband and wife) are their own "ultimate parent entity" (as defined in 16 C.F.R. § 801.1(a)(3)) and the Pescios, together with all entities controlled (as defined in 16 C.F.R. § 801.(1)(b)) by them: (a) did not for the year ended December 31, 2005 have aggregate sales of $113.4 million or more; or (b) as of the date hereof, do not, and as of the Effective Time will not, hold assets having an aggregate total value of $113.4 million or more, in each case determined in accordance with 16 C.F.R. § 801.11 (this representation and warranty being made solely for the purpose of determining the applicability of the notification provisions of the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended to the transactions contemplated by this agreement).

20

(n)

"Accredited Investor" Status  — Each of the Pescios is an "Accredited Investor" within the meaning of Regulation D under the 1933 Act. By reason of his or her business and financial experience, sophistication and knowledge, each of the Pescios is capable of evaluating the risks and merits of the investment made pursuant to this Agreement.

(o)

Investment Suitability  — Each of the Pescios has such knowledge and experience in financial and business matters as to be capable of evaluating the merits and risks of his or her investment in the Newco Shares and it is able to bear the economic risks and complete loss of such investment in the Newco Shares.

(p)

Access to Information  — Each of the Pescios hereby represents that: (i) he or she has been furnished by Vista during the course of this transaction with all information regarding the Vista Nevada Assets and Newco which it had requested; (ii) all documents that have been reasonably requested by the Pescios have been made available for their or their counsel's inspection and review; and (iii) any other information reasonably requested by the Pescios or their counsel has been provided.

(q)

Opportunity to Ask Questions  — Each of the Pescios has been afforded the opportunity to ask questions of and receive answers from duly authorized officers or other representatives of Vista and Newco concerning the terms and conditions of the issuance of the Newco Shares to the Pescios as partial consideration for the transfer of the Pescio Nevada Assets to the LLC.

(r)

Absence of Advertising  — In connection with the issuance of Newco Shares to the Pescios pursuant hereto, at no time was either of the Pescios presented with or solicited by any leaflet, public promotional meeting, circular, newspaper or magazine article, radio or television advertisement or any other form of general solicitation or general advertising within the meaning of Regulation D under the 1933 Act.

(s)

Investment Intent  — Each of the Pescios