Unassociated Document


    
       

      
        Supplemental
          agreement

         

        Western
          Mesquite Mines, Inc.

         

        RMB
          International (Dublin) Limited

         

        Each
          party listed in the schedule

         

        and

         

        RMB
          Resources Limited

         
 

       

      
        Freehills

      

      
        QV.1
          Building 250
          St
          Georges Terrace Perth Western
          Australia 6000 Australia
Telephone
          +61
          8
          9211 7777
          Facsimile +61
          8
          9211 7878
www.freehills.com
          DX
104
          Perth
SYDNEY
          MELBOURNE PERTH BRISBANE SINGAPORE

        Correspondent
          Offices HANOI HO CHI MINH CITY JAKARTA KUALA LUMPUR

        Reference
          DAW:IGS:80701774

         

      

      
        
           

        

        
           

          
            

          

        

        
           

        

      

       

      
        
          

        

      

      Table
        of contents

       

      
        	 Clause	 	 Page
	
                 

                1

              	
                 

                Definitions
                  and interpretation

              	
                 

                1

              
	
                 

                1.1

              	
                 

                Definitions

              	
                 

                1

              
	
                 

                1.2

              	
                 

                Interpretation

              	
                 

                2

              
	
                 

                1.3

              	
                 

                Definitions
                  in the Facility Agreement

              	
                 

                3

              
	
                 

                2

              	
                 

                Deferral
                  and Consideration

              	
                 

                3

              
	
                 

                2.1

              	
                 

                Deferral

              	
                 

                3

              
	
                 

                2.2

              	
                 

                Consideration

              	
                 

                3

              
	
                 

                2.3

              	
                 

                Events
                  of Default

              	
                 

                3

              
	
                 

                3

              	
                 

                Conditions
                  Precedent

              	
                 

                4

              
	
                 

                4

              	
                 

                Acknowledgements

              	
                 

                4

              
	
                 

                4.1

              	
                 

                Continuing
                  obligations

              	
                 

                4

              
	
                 

                4.2

              	
                 

                Transaction
                  Document

              	
                 

                4

              
	
                 

                5

              	
                 

                Miscellaneous

              	
                 

                4

              
	
                 

                5.1

              	
                 

                Governing
                  law

              	
                 

                4

              
	
                 

                5.2

              	
                 

                Further
                  assurances

              	
                 

                4

              
	
                 

                5.3

              	
                 

                Costs

              	
                 

                5

              
	
                 

                5.4

              	
                 

                Attorneys

              	
                 

                5

              
	
                 

                5.5

              	
                 

                Counterparts

              	
                 

                5

              
	
                 

                Schedule
                  - Security Providers

              	
                 

                6

              
	
                 

                Executed
                  as an agreement:

              	
                 

                7

              


      

       

      
        
           

        

        
          Page
            1

          
            

          

        

        
           

        

      

    


    
      

       This agreement

     

    is
      made
      on     2005
      by:

     

    


     

    1. Western
      Mesquite Mines, Inc.

                a
      corporation
      incorporated under the laws of Nevada

                of
      7000 Independence
      Parkway

                Suite
      160 #135    
            Plano,
      Texas 75025

                United
      States of
      America

                (Borrower)

     

    2. Each
      parties listed in the schedule 

                (each
      a Guarantor)

     

    3. RMB
      International (Dublin) Limited

                of
      158 Shelbourne
      Road

                Ballsbridge

                Dublin
      4
      Ireland

                (Lender)

     

    4. RMB
      Resources Limited

                of
      Two London
      Bridge,

             -London
      SE1 9R

             United
      Kingdom

                (Agent)

    Recitals

    A. Each
      party to this agreement is a party to the Facility Agreement. 

    B. Under
      the
      Facility Agreement, the Borrower must pay the Due Amount to the Agent on account
      of the Lender on the Due Date.

    C. The
      Agent
      has agreed to allow the Borrower to pay the Due Amount to the Agent for the
      account of the Lender on the Deferred Date, subject to the terms and conditions
      set out in this agreement.

     

    This
      agreement witnesses

     

    that
      in
      consideration of, among other things, the mutual promises contained in this
      agreement, the parties agree:

    

      
        

      
 

    	1  	
            Definitions
              and interpretation

          


     

     

    	1.1  	
            Definitions

          


     

    In
      this
      agreement:

     

    Deferral
      means
      the
      deferral of the payment of the Due Amount by the Borrower described in clause
      2.1 of this agreement;

     

    Deferred
      Date means
      30
      October 2005;

     

    
      
         

      

      
        Page
          2

        
          

        

      

      
         

      

    

    Definitive
      Merger Agreement means
      a
      definitive merger agreement to be entered into between WGI and Romarco that
      sets
      out the terms and conditions of the Merger;

     

    Due
      Amount means
      the
      Base Repayment Amount due to be paid by the Borrower on the Due Date under
      clause 7.1 of the Facility Agreement;

     

    Due
      Date means
      31
      July 2005;

     

    Facility
      Agreement means
      the
      document entitled “Facility Agreement” dated 5 November 2003 between the
      Borrower, each party listed in schedule 1 to that agreement, the Lender and
      the
      Agent;

     

    Merger
      means
      the
      merger of WGI and Romarco, as contemplated by the Preliminary Merger
      Agreement;

     

    Preliminary
      Merger Agreement means
      the
      preliminary binding agreement made between WGI, Romarco and US Gold in relation
      to a merger between those companies (US Gold has withdrawn from the proposed
      merger);

     

    Romarco
      means
      Romarco Minerals Inc., a company incorporated under the laws of
      Ontario;

     

    Securities
      has
      the
      meaning given to that term in the Facility Agreement;

     

    Transaction
      Documents has
      the
      meaning given to that term in the Facility Agreement;

     

    US
      Gold means
      U.S. Gold Corp., a company incorporated under the laws of Colorado;
      and

     

    WGI
      means
      Western Goldfields, Inc., a company incorporated under the laws of
      Idaho.

     

    	1.2  	
            Interpretation

          


     

    In
      this
      agreement, unless the context otherwise requires:

     

    	(a)  	
            headings
              and underlinings are for convenience only and do not affect the
              interpretation of this agreement;

          


     

    	(b)  	
            words
              indicating the singular include the plural and vice
              versa;

          


     

    	(c)  	
            other
              parts of speech and grammatical forms of a word or phrase defined in
              this
              agreement have a corresponding meaning;

          


     

    	(d)  	
            a
              reference to a part, clause, party, annexure, exhibit or schedule is
              a
              reference to a part and clause of and party, annexure, exhibit and
              schedule to, this agreement and a reference to this agreement includes
              any
              annexure, exhibit and schedule;

          


     

    	(e)  	
            a
              reference to a document includes all amendments or supplements to,
              or
              replacements or novations of, that
              document;

          


     

    	(f)  	
            a
              reference to any thing includes a part of that
              thing;

          


     

    	(g)  	
            a
              reference to a party to a document includes that party's successors
              and
              permitted assigns; and

          


     

    	(h)  	
            all
              monetary amounts are expressed in the currency of the United States
              of
              America.

          


     

     

    	1.3  	
            Definitions
              in the Facility Agreement

          


     

    Any
      terms
      defined in the Facility Agreement have the same meaning when used in this
      agreement, except to the extent to which those terms are otherwise defined
      in
      this agreement.

     

    
      
         

      

      
        Page
          3

        
          

        

      

      
         

      

    

    
      
        

      

    

    	2  	
            Deferral
              and Consideration

          


     

    	2.1  	
            Deferral

          


     

    	(a)  	
            Despite
              the repayment requirements set out in clause 7.1 of the Facility
              Agreement, and subject to clause 2.1(b) and clause 2.2, the Agent and
              the
              Lender each agree that it will not demand that the Borrower pay the
              Due
              Amount to the Agent (for the account of the Lender) on the Due
              Date.

          


     

    	(b)  	
            The
              Borrower covenants and agrees with the Agent and the Lender
              that:

          


     

    	(1)  	
            it
              will pay the Due Amount to the Agent (for the account of the Lender)
              on
              the Deferred Date; and

          


     

    	(2)  	
            the
              interest payable in respect of the Due Amount on the Due Date under
              clause
              5 and clause 6 of the Facility Agreement is to be capitalised from
              the Due
              Date up to and including the Deferred Date, and will bear interest
              in
              accordance with clause 5 of the Facility Agreement from the Due Date.
              The
              Borrower must pay the capitalised interest to the Agent on the Deferred
              Date.

          


     

    	2.2  	
            Consideration

          


     

    	(a)  	
            In
              consideration of the Agent and the Lender agreeing to the Deferral
              at the
              request of WGI, WGI must pay to the Lender on or before 2 August 2005
              the
              sum of US$50,000 (Deferral
              Fee).

          


     

    	(b)  	
            The
              Deferral will not take effect unless WGI pays the Deferral Fee to the
              Lender in accordance with clause 2.2(a).

          


     

    	(c)  	
            If:

          


     

    	(1)  	
            WGI
              has not paid the Deferral Fee to the Lender by 2 August 2005;
              and

          


     

    	(2)  	
            the
              Borrower fails to pay the Due Amount on or before 2 August
              2005,

          


     

    the
      parties agree that a Default under clause 12.1(a) of Facility Agreement will
      occur, and the Agent’s and the Lender’s respective rights in respect of that
      Default will be preserved and unaffected by the terms of this
      agreement.

     

    	2.3  	
            Merger

          


     

    In
      addition to the Default events described in clause12.1 of the Facility
      Agreement, it will be a Default if:

     

    	(a)  	
            on
              or before the Final Repayment Date:

          


     

    	(1)  	
            the
              Preliminary Merger Agreement is terminated;
              or

          


     

    	(2)  	
            any
              of WGI or Romarco announces that the Merger is not proceeding;
              or

          


     

    	(b)  	
            the
              Definitive Merger Agreement is not entered into on or before 15 September
              2005.

          


     

    
      
         

      

      
        Page
          4

        
          

        

      

      
         

      

    

    
      
        

      

    

    	3  	
            Conditions
              Precedent

          


     

    This
      agreement and the obligation of the Agent and the Lender not to demand payment
      of the Due Amount on the Due Date is subject to the Agent receiving the
      following in form and substance satisfactory to the Agent:

     

    	(a)  	
            corporate
              authorisation:
              a
              certified copy of a resolution of the directors or other Authorised
              Officers of the Borrower and each Guarantor approving this agreement
              and
              the transactions contemplated by this agreement and authorising execution
              by the Borrower and each Guarantor of this
              agreement;

          


     

    	(b)  	
            consideration:
              the Deferral Fee has been paid in accordance with clause 2.2;
              and

          


     

    	(c)  	
            fees:
              evidence that all of the Agent’s fees for legal counsel have been
              paid.

          


     

    
      
        

      

    

    	4  	
            Acknowledgements

          


     

    	4.1  	
            Continuing
              obligations

          


     

    Despite
      the terms of this agreement, the Borrower and each Guarantor acknowledges and
      agrees for the benefit of the Agent and the Lender that:

     

    	(a)  	
            it
              will continue to be liable for all of its existing and future obligations
              under the Facility Agreement, each Security and each other Transaction
              Document to which it is a party; and

          


     

    	(b)  	
            this
              agreement will not abrogate, prejudice, discharge, limit or affect
              in any
              way its duties, obligations and liabilities under each document described
              in clause 4.1(a) to which it is a party.

          


     

    	4.2  	
            Transaction
              Document

          


     

    Each
      party acknowledges and agrees that this agreement is a Transaction Document
      for
      the purposes of the Facility Agreement.

     

    
      
        

      

    

    	5  	
            Miscellaneous

          


     

    	5.1  	
            Governing
              law

          


     

    	(a)  	
            This
              agreement is governed by the laws of the State of
              Colorado.

          


     

    	(b)  	
            The
              parties irrevocably and unconditionally:

          


     

    	(1)  	
            submit
              to and accept the non-exclusive jurisdiction of the courts of the State
              of
              Colorado; and

          


     

    	(2)  	
            waive
              any objection to the venue of any legal process on the basis that the
              process has been brought in an inconvenient
              forum.

          


     

    	5.2  	
            Further
              assurances

          


     

    Each
      party must do all things and execute all further documents necessary to give
      full effect to this agreement.

     

    
      
         

      

      
        Page
          5

        
          

        

      

      
         

      

    

    	5.3  	
            Costs 

          


     

    The
      Security Providers will pay the costs and expenses in respect of the
      negotiation, preparation and execution of this agreement.

     

    	5.4  	
            Attorneys

          


     

    Each
      of
      the attorneys executing this agreement states that the attorney has no notice
      of
      the revocation of the power of attorney appointing that attorney.

     

    	5.5  	
            Counterparts

          


     

    This
      agreement may be signed in any number of counterparts and all counterparts
      together constitute one and the same instrument.


    
      
         

      

      
        Page
          6

        
          

        

      

      
         

      

    

    
      

    

    Schedule
      - Security Providers


     

    	(1)  	
            WGI;
              and

          


     

    	(2)  	
            Calumet
              Mining Company, a company incorporated under the laws of
              Idaho.

          


     


    
      
         

      

      
        Page
          7

        
          

        

      

      
         

      

    


    
      
        

      

    

    Executed
      as
      an agreement:

     

    Signed
      for

    Western
      Mesquite Mines, Inc.

    by:

     

    /s/Thomas
      K.
      Mancuso                           
        

    Signature

    


    President
      &
      CEO                                      
       

    Title

    


    Thomas
      K.
      Mancuso                              
        

    Name
      (please print)

    


    Signed
      for

    Western
      Goldfields, Inc.

    by:

     

    /s/
      Thomas K.
      Mancuso                         

    Signature

     

    President
      &
      CEO                                   
       

    Title

    


    Thomas
      K.
      Mancuso                           
       

    Name
      (please print)

     

    Signed
      for

    Calumet
      Mining Company

    by:

     

    /s/
      Thomas K.
      Mancuso                    
       

    Signature

     

    President
      &
      CEO                                 
       

    Title

    


    Thomas
      K.
      Mancuso                         
       

    Name
      (please print)

     

    


    
      
         

      

      
        Page
          8

        
          

        

      

      
         

      

    

     

    Signed
      for

    RMB
      International (Dublin) Limited

    by:

    


    
      	 	 	 	 
	/s/ 	 	 	/s/ 
	
              
Authorised
              Signatory 	 	 	
              
Authorised
              Signatory 


    

     

    
      	 	 	 	 
	/s/ 	 	 	/s/ 
	
              
Name
              (please print)	 	 	
              
Name
              (please print)


    

     

    Signed
      for

    RMB
      Resources Limited

    by:

    
      


      
        	 	 	 	 
	/s/ 	 	 	/s/ 
	
                
Authorised
                Signatory 	 	 	
                
Authorised
                Signatory 


      

       

      
        	 	 	 	 
	/s/ 	 	 	/s/ 
	
                
Name
                (please print)	 	 	
                
Name
                (please print)


      

       

       

      
        
           

        

        
          Page
            9