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EXHIBIT 10.2

SERIES A
LIMITED RECOURSE SECURED PROMISSORY NOTE
(Replacement Note)
 
$4,231,925.19
April 15, 2010

FOR VALUE RECEIVED, Win-Eldrich Gold, Inc., a Nevada corporation (“Maker”),
promises to pay to the order of Golden Phoenix Minerals, Inc., a Nevada
corporation or its assigns (“Holder”), the principal sum of Four Million Two
Hundred Thirty-One Thousand Nine Hundred Twenty-Five Dollars and Nineteen Cents
($4,231,925.19) (the “Principal Amount”) with interest on the outstanding
principal amount at a rate of five and twenty-five hundredths percent per annum
(5.25%) (computed on the basis of actual calendar days elapsed and a year of 360
days) (the “Interest Rate”).
 
1.           Issuance Under Promissory Note Modification Agreement.  This Note
is being issued by the Maker pursuant to that certain Purchase and Sale of LLC
Membership Interest Agreement, dated May 11, 2009 between Maker and Holder (the
“Ashdown Project Purchase Agreement”), as modified by that certain Promissory
Note Modification Agreement dated as of even date herewith entered into by and
between the Maker and Holder (the “Modification Agreement”).
 
2.           Maturity.  Unless sooner paid in accordance with the terms hereof,
the entire unpaid principal amount and all unpaid accrued interest shall become
fully due and payable on the earlier of (a) April 1, 2015 or (b) the
acceleration of the maturity of this Note as provided herein upon the occurrence
of an Event of Default (such earlier date, the “Maturity Date”).
 
3.           Payments.
 
(a)           Monthly Payments.  The Principal Amount and interest accrued
thereon shall be repaid in equal monthly installments over a forty-nine (49)
month period in accordance with the payment schedule attached hereto as Exhibit
A, which schedule shall be adjusted from time to time to reflect any prepayments
by Maker.  Interest shall not begin to accrue on the Principal Amount until, and
the first monthly installment under this Note shall commence on, April 1, 2011,
and each subsequent payment shall be payable on the first day of each month
thereafter until all remaining unpaid principal and interest have been repaid
(each a “Monthly Payment”).
 
(b)           Form of Payment.  All payments of interest and principal (other
than payment by way of conversion) shall be in lawful money of the United States
of America to Holder, at the address as may be specified from time to time by
Holder in a written notice delivered to Maker.
 
(c)           Prepayment.  Maker may prepay all or any portion of the
outstanding Principal Amount at any time without the consent of the Holder and
without penalty or premium.
 
4.           Security and Limited Recourse.  The full and timely performance of
the obligations hereunder is secured by a lien upon, and a security interest in,
the collateral identified and described as security therefore in the Security
Agreement, as amended by the First Amendment to Security Agreement attached
hereto as Exhibit B (the “Security Agreement”). This Note shall be limited
recourse against Maker and its successors in interest. The sole recourse of the
Holder (or any successor in interest to, or assign of Holder) for the collection
of amounts owed, or the enforcement of rights arising hereunder, shall be
foreclosure (without rights of deficiency) on the Collateral (as defined in the
Security Agreement) and no other property of Maker, its affiliates, or their
successors in interest, shall be subject to levy, execution or other enforcement
action in connection with this Note.
 
 
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5.           Priority and Subordination.  Holder is the holder of that certain
Series B-1 Note, that Series B-2 Note and that Series C Note issued by Maker,
dated as of even date herewith, in connection with and the Ashdown Project
Purchase Agreement and the Modification Agreement (jointly, the “Series B and C
Notes”).  Notwithstanding the assignment to the Permitted Assignees as set forth
in Section 11of the Series B and C Notes, this Note and the Series B and C Notes
will share a first priority security interest in pari passu as to the Collateral
(as defined in the Security Agreement).  In the event that a third party desires
to provide Maker financing, so long as this Note is still outstanding, Holder
agrees to enter into an Intercreditor Agreement with such third party (in form
and substance reasonably acceptable to all parties), such that Holder and the
third party will share a first priority security interest in pari passu of their
respective investment or loan amounts as to One Million Five Hundred Thousand
Dollars ($1,500,000) minus the aggregate outstanding principal balance on the
Series B and C Notes as of the date of such proposed third-party financing (the
“Additional Financing Amount”).  The Additional Financing Amount may be assigned
to such similar priority position in pari passu so long as (a) title to the
Ashdown Mill has vested in Ashdown Project, LLC, a Nevada limited liability
company (the “LLC”) and (b) Maker has made an additional capital contribution to
the LLC of at least Five Hundred Thousand Dollars ($500,000) in cash.  In
accordance with this Section 5, Holder will subordinate its loan and its
security interest in the Collateral (as defined in the Security Agreement) as to
the balance of any principal and interest outstanding under this Note, providing
such documentation as reasonably requested by Maker evidencing such
subordination within five (5) business days of request.
 
Notwithstanding anything herein, the Security Agreement or any other agreement
between Maker and Holder, Maker and Holder agree that Perry Muller and/or the
LLC can encumber, collateralize and seek financing for the granting of a sole
first priority interest in the Ashdown Mill up to Five Hundred Thousand
($500,000) and the lender or investor will not be subject to the limiting
provisions of Section 1.1(b)(i) of the Ashdown Project Purchase Agreement.
 
6.           Events of Default.  For purposes of this Note, an “Event of
Default” shall be deemed to have occurred if any of the following happens and
such default is not cured within fifteen (15) business days, or in the case of a
non-monetary default thirty (30) calendar days or such other reasonable period
of time to cure, if cure cannot be reasonably accomplished within such time,
after Holder has given Maker written notice of such default:
 
(a)           Maker fails to pay when due and payable any amount of principal or
interest on the Note;
 
 
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(b)           Maker breaches any material obligation to the Holder under this
Note or the Series B and C Notes, or Maker fails to perform promptly at the time
and in the manner provided in this Note or the Series B and C Notes;
 
(c)           Maker’s commencement of a case or other proceeding (i) relating to
the Maker under bankruptcy laws, as now or hereafter constituted, or any other
applicable bankruptcy, insolvency or other similar laws, (ii) seeking the
assignment for the benefit of creditors, or the Maker becomes a debtor or
alleged debtor in a case under the U.S. Bankruptcy Code or becomes the subject
any other bankruptcy or similar proceeding for the general adjustment of its
debts; (iii) seeking the appointment of a receiver, liquidated, assignee,
custodian, trustee, sequestrator (or similar official) of the Maker for all or
substantially all of the Maker’s property, or (iv) seeking the winding-up or
liquidation of the Maker’s affairs; and
 
(d)           (i) An order for relief with respect to Maker is entered under
bankruptcy laws, as now or hereafter constituted, or any other applicable
bankruptcy, insolvency or other similar law, or (ii) any other order, judgment
or decree shall be entered in any proceeding by any court of competent
jurisdiction appointing, without the consent of Maker, a receiver, trustee or
liquidator of Maker, or for all or substantially all of its property, or a
sequestering of all or substantially all of the property of Maker, and any such
order, judgment or decree or appointment or sequestration shall be final or
shall remain in force undismissed, unstayed or unvacated for a period of ninety
(90) consecutive days after the date of entry thereof.
 
(e)           The dissolution of any entity status of the Maker, as applicable.
 
(f)           Maker or LLC defaults on such obligations or Assigned Assets (as
that term is defined in the Ashdown Project Purchase Agreement) of the LLC on
which Holder is a guarantor, surety or the like, pursuant to Section 4.1 of the
Ashdown Project Purchase Agreement, which default results in a final judgment
being rendered by a federal or state court, or other administrative proceeding,
after the date hereof against the Holder.
 
7.           Right of Offset.  To the extent the Ashdown Project Purchase
Agreement provides for costs or expenses to be incurred or shared by Holder or
allows offset, Maker shall have a right of offset against amounts due under this
Note.
 
8.           Governing Law.  This Note is to be construed in accordance with and
governed by the internal laws of the State of Nevada without giving effect to
any choice of law rule that would cause the application of the laws of any
jurisdiction other than the internal laws of the State of Nevada to the rights
and duties of Maker and the Holder.
 
9.           Dispute Resolution.  Each of the Holder and Maker hereby
(a) submits to the exclusive jurisdiction of the federal and state courts
located in the State of Nevada, for the purpose of any action or proceeding
arising out of or relating to this Note, (b) agrees that all claims in respect
of any such action or proceeding may be heard and determined in such courts,
(c) irrevocably waives (to the extent permitted by applicable law) any objection
which it now or hereafter may have to the laying of venue of any such action or
proceeding brought in any of the foregoing courts, and any objection on the
ground that any such action or proceeding in any such court has been brought in
an inconvenient forum, and (d) agrees that a final judgment in any such action
or proceeding shall be conclusive and may be enforced in other jurisdictions by
suit on the judgment or in any other manner permitted by law.
 
 
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10.           Waiver of Right to Jury Trial.  EACH OF THE HOLDER AND MAKER, TO
THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, HEREBY IRREVOCABLY WAIVES ALL
RIGHT TO TRIAL BY JURY AS TO ANY ISSUE RELATING HERETO IN ANY ACTION, PROCEEDING
OR COUNTERCLAIM ARISING OUT OF OR RELATING TO THIS NOTE.
 
11.           Amendment.  Any term of this Note may be amended and the
observance of any term of this Note may be waived (either generally or in a
particular instance and either retroactively or prospectively), only with the
written consent of Maker and Holder.  Any amendment or waiver effected in
accordance with this paragraph shall be binding upon Maker, the Holder.
 
12.           Assignment.   Neither this Note nor any rights hereunder may be
assigned, conveyed or transferred, in whole or in part, without Maker’s prior
written consent, which Maker may withhold in its sole discretion; provided
however, that this Note may be assigned, conveyed or transferred, in whole or in
part, without the prior written consent of Maker to any person that directly, or
indirectly through one or more intermediaries, controls, is controlled by, or is
under common control with Holder.  The rights and obligations of Maker and
Holder under this Note shall be binding upon and benefit their respective,
permitted successors, ensigns, heirs, administrators and transferees.
 
13.           No Benefit. Nothing expressed in or to be implied from this Note
is intended to give, or shall be construed to give, any person or entity, other
than the parties hereto and their permitted successors and assigns hereunder,
any benefit or legal or equitable right, remedy or claim under or by virtue of
this Note or under or by virtue of any provision herein.
 
14.           Attorneys’ Fees. In the event any party is required to engage the
services of any attorneys for the purpose of enforcing this Note, or any
provision thereof, the prevailing party shall be entitled to recover its
reasonable expenses and costs in enforcing this Note, including attorneys’ fees.
 
15.           Headings.  The headings and captions used in this Note are used
only for convenience and are not to be considered in construing or interpreting
this Note.  All references in this Note to sections and exhibits shall, unless
otherwise provided, refer to sections hereof and exhibits attached hereto, all
of which exhibits are incorporated herein by this reference.
 
16.           Notices.  Unless otherwise provided, any notice required or
permitted under this Note shall be given in writing and shall be deemed
effectively given (i) at the time of personal delivery, if delivery is in
person; (ii) one (1) business day after deposit with an express overnight
courier for United States deliveries, or two (2) business days after such
deposit for deliveries outside of the United States, with proof of delivery from
the courier requested; or (iii) three (3) business days after deposit in the
United States mail by certified mail (return receipt requested) for United
States deliveries when addressed to the party to be notified at the address
indicated for such party on the signature page to this Note, or at such other
address as any party or Maker may designate by giving ten (10) days’ advance
written notice to all other parties.
 
 
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17.           Severability.  If one or more provisions of this Note are held to
be unenforceable under applicable law, such provision shall be excluded from
this Note and the balance of the Note shall be interpreted as if such provision
were so excluded and shall be enforceable in accordance with its terms.
 
18.           Miscellaneous.
 
(a)           The meaning of defined terms shall be equally applicable to both
the singular and plural forms of the terms defined.
 
(b)           References to agreements and other contractual instruments shall
be deemed to include all subsequent amendments and other modifications thereto.
 
(c)           References to statutes or regulations are to be construed as
including all statutory and regulatory provisions consolidating, amending or
replacing the statue regulation referred to.
 
(d)           The rights and remedies of Holder as provided in this Note and in
the Security Agreement shall be cumulative and concurrent and may be pursued
singly, successively or together against Maker, or any other persons or entities
who are, or may become liable for all or any part of this indebtedness, and any
other funds, property or security held by Holder for the payment hereof, or
otherwise, at the sole discretion of Holder. Failure to exercise any such right
or remedy shall in no event be construed as a waiver or release of such rights
or remedies, or the right to exercise them at any later time.
 
 [SIGNATURES TO FOLLOW]
 

 
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IN WITNESS WHEREOF, Maker has caused this Note to be duly executed by its
officers, thereunto duly authorized as of the date first above written.
 
 

 
“MAKER”
     
WIN-ELDRICH GOLD, INC.,
 
a Nevada corporation
     
By:   /s/ Perry Muller                                             
 
Name:    Perry Muller                                             
 
Title:   President                                                     

SIGNATURE PAGE
TO THE
SERIES A LIMITED RECOURSE
SECURED PROMISSORY NOTE
(WIN-ELDRICH GOLD, INC.)

 
 

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EXHIBIT A
 
SERIES A NOTE PAYMENT SCHEDULE
 
Inputs
 
Key Figures
Loan principal amount
$4,231,925.19
 
Annual loan payments
$1,153,709.16
Annual interest rate
5.250%
 
Monthly payments
$96,142.43
Loan period in years
4.0833
 
Interest in first calendar year
$154,280.04
Base year of loan
2011
 
Interest over term of loan
$479,015.42
Base month of loan
April
 
Sum of all payments
$4,710,940.61
                 
Payments in First 12 Months
Year
Month
Beginning Balance
Payment
Principal
Interest
Cumulative Principal
Cumulative Interest
Ending Balance
2011
Apr
$4,231,925.19
$96,142.43
$77,627.76
$18,514.67
$77,627.76
$18,514.67
$4,154,297.43
 
May
$4,154,297.43
$96,142.43
$77,967.38
$18,175.05
$155,595.14
$36,689.72
$4,076,330.05
 
Jun
$4,076,330.05
$96,142.43
$78,308.49
$17,833.94
$233,903.63
$54,523.66
$3,998,021.56
 
Jul
$3,998,021.56
$96,142.43
$78,651.09
$17,491.34
$312,554.72
$72,015.00
$3,919,370.47
 
Aug
$3,919,370.47
$96,142.43
$78,995.18
$17,147.25
$391,549.90
$89,162.25
$3,840,375.29
 
Sep
$3,840,375.29
$96,142.43
$79,340.79
$16,801.64
$470,890.69
$105,963.89
$3,761,034.50
 
Oct
$3,761,034.50
$96,142.43
$79,687.90
$16,454.53
$550,578.59
$122,418.42
$3,681,346.60
 
Nov
$3,681,346.60
$96,142.43
$80,036.54
$16,105.89
$630,615.13
$138,524.31
$3,601,310.06
 
Dec
$3,601,310.06
$96,142.43
$80,386.70
$15,755.73
$711,001.83
$154,280.04
$3,520,923.36
2012
Jan
$3,520,923.36
$96,142.43
$80,738.39
$15,404.04
$791,740.22
$169,684.08
$3,440,184.97
 
Feb
$3,440,184.97
$96,142.43
$81,091.62
$15,050.81
$872,831.84
$184,734.89
$3,359,093.35
 
Mar
$3,359,093.35
$96,142.43
$81,446.40
$14,696.03
$954,278.24
$199,430.92
$3,277,646.95
                 
Yearly Schedule of Balances and Payments
 
Year
Beginning Balance
Payment
Principal
Interest
Cumulative Principal
Cumulative Interest
Ending Balance
 
2012
$3,520,923.36
$1,153,709.16
$992,517.35
$161,191.81
$1,703,519.18
$315,471.85
$2,528,406.01
 
2013
$2,528,406.01
$1,153,709.16
$1,045,896.70
$107,812.46
$2,749,415.88
$423,284.31
$1,482,509.31
 
2014
$1,482,509.31
$1,153,709.16
$1,102,147.00
$51,562.16
$3,851,562.89
$474,846.46
$380,362.30
 
2015
$380,362.30
$384,531.26
$380,362.30
$4,168.96
$4,231,925.19
$479,015.42
$0.00
 

 

 
A-1

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EXHIBIT B
 
SECURITY AGREEMENT
 
 
 
 
 
B-1

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