CAPITAL GOLD CORPORATION

Nayarit Gold, Inc.
Nayarit Gold, Inc.
76 Temple Terrace, Suite 150
Lower Sackville, Nova Scotia
B4C 0A7

Re: Capital Gold Corporation (the “Company”)

Ladies and Gentlemen:

Reference is made to the Business Combination Agreement by and between the
Company and Nayarit Gold, Inc. dated February 10, 2010 and amended on April 29,
2010.  Pursuant to Section 7.1(b) of the Agreement, as amended, either party may
terminate the Agreement by written notice if the closing conditions set forth in
Section 6.1 have not been satisfied by the date which is 150 days after the date
of the Agreement, or July 10, 2010 (the “Completion Deadline”).  We understand
the Nayarit shareholder meeting to approve the transaction is scheduled to be
held on July 12, 2010 and, subject to shareholder approval at that meeting, the
intent is to work together to close the amalgamation promptly
thereafter.  Accordingly, we agree to extend the Completion Deadline to August
2, 2010.

 Please acknowledge your understanding of (and agreement to, as applicable) the
terms and conditions outlined above by signing a copy of this letter and
returning it to the undersigned.

 
Very truly yours,
     
CAPITAL GOLD CORPORATION
     
By:
/s/ Christopher Chipman    
Name: Christopher Chipman
   
Title: Chief Financial Officer

NAYARIT GOLD, INC.
     
By:
/s/ Colin Sutherland    
Name: Colin Sutherland
   
Title: President
 

 

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