SENIOR SECURED NOTES REPURCHASE AGREEMENT

 

This SENIOR SECURED NOTES REPURCHASE AGREEMENT (this “Agreement”) to repurchase 10% Senior Secured Notes of Vista Gold Corporation due March 4, 2011 is made as of May 13, 2010 by and between Whitebox Advisors LLC (the “Holder”) and Vista Gold Corporation, a company organized and existing under the laws of the Yukon Territory, Canada (the “Company”).

 

WHEREAS, the Holder is the legal and beneficial owner and holder of the 10% Senior Secured Notes of the Company due March 4, 2011 (the “Notes”) identified on Schedule A hereto, issued pursuant to a Senior Secured Note Indenture dated March 4, 2008 (the “Indenture”) by and among, the Company, Minera Paredones Amarillos S.A. de C.V., as guarantor, HSBC Bank USA, N.A., as trustee (the “Trustee”), and HSBC México, S.A. de C.V., Institución de Banca Múltiple, Grupo Financiero HSBC, División Fiduciaria, as collateral agent;

WHEREAS, the Notes, to date, have not matured; and

WHEREAS, the Holder, desiring to sell the Notes, approached the Company with respect thereto, and the Company in turn desires to repurchase Notes from the Holder in the aggregate principal amount identified on Schedule A hereto (the “Subject Notes”).

NOW THEREFORE, in consideration of the mutual promises, representations, warranties, covenants and agreements of the parties contained herein and for good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, the parties hereto agree as follows:

 

1.1           Subject to the terms and conditions of this Agreement, the Company agrees to repurchase from the Holder and the Holder agrees to sell to the Company the Subject Notes identified on Schedule A hereto, in the principal amount and for an aggregate purchase price as set forth on Schedule A hereto, to be paid as follows: (i) 40% of the principal amount of the Subject Notes to be paid in cash discounted at 1.5% (“Purchase Price”) and (ii) 60% of the principal amount of the Subject Notes and the remaining interes t on the Subject Notes though maturity to be paid through the issuance of common shares of the Company (“Shares”).     .

 

1.2           The repurchase and sale of the Subject Notes shall take place at the offices of Dorsey & Whitney LLP, 370 17th Street, Denver, Colorado 80202 on May 20, 2010, or such other date as the parties may agree upon in writing upon satisfaction of the conditions to closing provided in Sections 2 and 3 hereof  (the “Closing Date”).

 

1.3           On  or prior to the Closing Date, Holder shall deliver the Subject Notes on behalf of Company to the Trustee, duly endorsed or accompanied by an assignment duly endorsed in a form acceptable to the Trustee, or by means of the book-entry transfer procedures of The Depositary Trust Company, as depositary for the Subject Notes, or by other means of transfer reasonably acceptable to Company and the Trustee, against payment by the Company to the Holder of the Purchase Price described on Schedule A hereto, by wire transfer using the wire

 

instructions to be provided separately to the Company by the Holder and delivery of the Shares to Holder by means of the book-entry transfer procedures of The Depositary Trust Company.

 

1.4           The Holder hereby agrees that upon receipt of the Purchase Price and the Shares, the Subject Notes shall be cancelled by the Trustee and the Company shall have no further obligation to the Holder thereunder.

 

SECTION 2.                                Conditions Precedent to the Holder’s Obligation to Close

 

The Holder’s obligation to sell the Subject Notes and to take the other actions required to be taken by the Holder pursuant to this Agreement is subject to the satisfaction, or waiver, of the following conditions:

 

2.1           The representations and warranties of the Company made in this Agreement shall be true and correct in all respects, as of the date hereof and as of the Closing Date as though then made.

 

2.2           The Company shall have duly performed and complied with all of the obligations that the Company is required to perform or to comply with pursuant to this Agreement on or prior to the Closing Date.

The Company’s obligation to repurchase the Subject Notes and to take the other actions required to be taken by the Company pursuant to this Agreement is subject to the satisfaction, or waiver, of the following conditions:

 

3.1           The representations and warranties of the Holder made in this Agreement shall be true and correct in all respects, as of the date hereof and as of the Closing Date as though then made.

 

3.2           The Holder shall have duly performed and complied with all of the obligations that the Holder is required to perform or to comply with pursuant to this Agreement on or prior to the Closing Date.

3.3           The Shares shall have been approved for listing by the NYSE Amex and the Toronto Stock Exchange.

SECTION 4.                                Representations And Warranties Of Holder.

 

Holder represents and warrants to the Company, as of the date hereof and as of the date of delivery of the Subject Notes that:

 

(a)           The execution, delivery and performance by Holder of this Agreement, and the consummation of the transactions contemplated hereby are within the powers of Holder and have been or will have been duly authorized by all necessary action on the part of Holder, and that this Agreement constitutes a valid and binding agreement of Holder, enforceable in accordance with its terms, except (i) as limited by applicable bankruptcy, insolvency, reorganization, moratorium, and other laws of general application affecting enforcement or creditors’ rights generally or

 

(ii) as limited by laws relating to the availability of specific performance, injunctive relief, or other equitable remedies.

 

(b)           The execution, delivery and performance by Holder of this Agreement and the consummation of the transactions contemplated hereby require no order, license, consent, authorization or approval of, or exemption by, or action by or in respect of, or notice to, or filing or registration with, any governmental body, agency or official on the part of Holder.

 

(c)           The execution, delivery and performance by Holder and Company of this Agreement, and the consummation of the transactions contemplated by this Agreement, do not and will not (i) violate the articles of incorporation (or similar constituent document) or bylaws of Holder, (ii) violate any material agreement to which Holder is a party or by which Holder or any of its property or assets is bound, or (iii) violate any law, rule, regulation, judgment, injunction, order or decree applicable to Holder.

 

(d)           Holder is the beneficial owner of the Subject Notes, and upon the consummation of the transactions contemplated hereby, the Company will receive the Subject Notes, in each case, free and clear of any encumbrances, including, without limitation, any charge, claim, condition, equitable interest, lien, option, pledge, security interest, right of first refusal, or restriction of any kind, including any restriction on use, voting, transfer, receipt of income, or exercise of any other attribute of ownership.

 

(e)           There is no investment banker, broker, finder or other intermediary which has been retained by, will be retained by or is authorized to act on behalf of Holder who might be entitled to any fee or commission from Company or Holder upon consummation of the transactions contemplated by this Agreement.

 

(f)           The Holder has received all the information it considers necessary or appropriate to determine whether to sell the Subject Notes to the Company pursuant to this Agreement. The Holder acknowledges (i) the Company has not made any representation or warranty, express or implied, except as set forth herein, regarding any aspect of the sale and purchase of the Subject Notes, the operation or financial condition of the Company or the value of the Subject Notes, (ii) that it is not relying upon the Company in making its decision to sell the Subject Notes to the Company pursuant to this Agreement and (iii) that the Company is relying upon the truth of the representations and warranties in this Section 4 in connection with the purchase of the Subject Notes hereunder.