Unassociated Document


    EXHIBIT
      10.2

    INDEMNIFICATION
      AGREEMENT

    


    



INDEMNIFICATION
  AGREEMENT,
  dated as of the 9th day of August 2006, by and between Western Goldfields,
  Inc., an Idaho corporation with its principal office located at 6502 E. Highway
  78, Brawley, CA 92227 (the "Company"), and __________, a director and/or officer
  of the Company residing at _________________ (the "Indemnitee"). 

    


    W
      I T N E S S E T H :

    


    WHEREAS,
      the
      Company seeks to attract and retain the most capable persons available to serve
      as its directors and officers; and

    


    WHEREAS,
      such
      persons require substantial protection against personal liability arising out
      of
      their faithful service to the Company; and

    


    WHEREAS,
      the
      Company and the Indemnitee believe it desirable to enter into agreements to
      reflect indemnifi-cation and advancement of expenses arrangements;
      and

    


    WHEREAS,
      in
      recognition of the Company's desire to retain the services of the Indemnitee
      and
      in furtherance of the Company's policy, the Company desires to provide the
      Indemnitee with the right to indemnification and advancement of expenses and
      the
      Indemnitee desires to receive such right, all upon the terms and subject to
      the
      conditions contained herein; and

    


    NOW,
      THEREFORE,
      in
      consideration of the foregoing premises, the Indemnitee's continued service
      to
      the Company and the mutual covenants contained herein, the parties hereby agree
      as follows:

    


    1. Certain
      Terms Defined.
      As used
      in this Agreement, the following terms shall have the following
      meanings:

    


    (a)  The
      term
      "Action" shall mean any action or proceeding, whether civil, criminal,
      administrative or investigative, and including, but not limited to, one by
      or in
      the right of the Company or by or in the right of any other Entity, which the
      Indemnitee served in any capacity at the request of the Company.

    


    (b)  The
      term
      "Agreement" shall mean this Indemnification Agreement, as the same may be
      amended from time to time.

    


    (c)  The
      term
      "Entity" shall mean any company of any type or kind, domestic or foreign, or
      any
      partnership, limited liability company, joint venture, trust, employee benefit
      plan or any other enterprise or entity.

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    
 

    2.  Indemnification.
      Subject
      to the terms set forth in this Agreement, the Company shall defend, indemnify
      and save harmless the Indemnitee if the Indemnitee is made, or is threatened
      to
      be made, a party to any Action or a witness on behalf of the Company or any
      affiliate thereof, in any Action, by reason of the fact that the Indemnitee
      (or
      the Indemnitee's testator or intestate) served as a member on the Board of
      Directors of the Company, served as an officer of the Company, or served another
      Entity in any capacity at the request of the Company, against judgments, fines,
      amounts paid in settlement and expenses, including reasonable attorneys' fees
      and expenses and costs of investigation, incurred as a result of such Action
      or
      any appeal relating thereto.

    


    3.  Limitation
      on Indemnification.
      The
      Indemnitee shall be entitled to indemnification under Section 2 except if a
      judgment or other final adjudication adverse to the Indemnitee establishes
      that
      (i) the Indemnitee's acts were committed in bad faith, by gross negligence
      or
      were the result of active and deliberate dishonesty and, in either case, were
      material to the cause of action so adjudicated, or (ii) as a result of such
      acts, the Indemnitee personally gained in fact a financial profit or other
      advantage to which the Indemnitee was not legally entitled.

    


    4.  Partial
      Indemnification.
      Except
      as otherwise provided in Section 3, if the Indemnitee is only partially
      successful in the defense, investigation, settlement or appeal of any Action
      described in Section 2 hereof, and as a result is not entitled under Section
      7(b) hereof to indemnification by the Company for the total amount of the
      expenses (including reasonable attorneys’ fees and expenses), costs, judgements,
      penalties, fines, and amounts paid in settlement actually and reasonably
      incurred by him, the Company shall nevertheless indemnify the Indemnitee, as
      a
      matter of right pursuant to Section 7(b) hereof, to the extent the Indemnitee
      has been partially successful.

    


    5.  Advances
      of Expenses.
      (a) At
      the written request of the Indemnitee, the Company will advance to the
      Indemnitee the expenses (including reasonable attorneys' fees and expenses
      and
      costs of investigation) incurred by the Indemnitee in defending any Action
      in
      advance of the final disposition of such Action.

    


    (b) The
      Indemnitee hereby agrees and undertakes to repay such advanced amounts (or
      appropriate portions thereof) if a court of competent jurisdiction ultimately
      determines that the Indemnitee was not entitled to such amounts.

    


    6.  Payment
      by Company.
      The
      Company shall pay the indemnification requested under Section 2 and advance
      the
      expenses requested under Section 5 promptly following receipt by the Company
      of
      the Indemnitee's written request therefor and, in any event, no later than
      five
      (5) days after such receipt.

    


    7.  Enforcement.
      (a) The
      right of the Indemnitee to indemnification and advancement of expenses provided
      by this Agreement shall be enforceable by the Indemnitee in any court of
      competent jurisdiction. In such an enforcement action, the burden shall be
      on
      the Company to prove that the indemnification and advancement of expenses being
      sought are not appropriate. Neither the failure of the Company to determine
      whether indemnification or the advancement of expenses is proper in the
      circumstances nor an actual determination by the Company thereon adverse to
      the
      Indemnitee shall constitute a defense to the action or create a presumption
      that
      the Indemnitee is not so entitled.

     

    
      
        
        

      

      
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    (b) Without
      limiting the scope of indemnification to which the Indemnitee is entitled under
      this Agreement, (i) if the Indemnitee has been successful on the merits or
      otherwise in the defense of an Action, the Indemnitee shall be entitled to
      indemnification as authorized in Section 2 and (ii) the termination of any
      Action by judgment, settlement, conviction or plea of nolo contendere or its
      equivalent shall not in itself create a presumption that the Indemnitee has
      not
      met the standard of conduct required for indemnification under this Agreement.
      

    


    (c) The
      Indemnitee's reasonable expenses (including, but not limited to, attorneys’ fees
      and expenses) incurred in connection with successfully establishing or enforcing
      the Indemnitee's right to indemnification or advancement of expenses, in whole
      or in part, in any such proceeding under this section also shall be indemnified
      by the Company. 

    


    8.  Non-Exclusivity.
      Nothing
      contained in this Agreement shall limit the right to indemnification and
      advancement of expenses to which the Indemnitee would be entitled by law in
      the
      absence of this Agreement, or shall be deemed exclusive of any other rights
      which the Indemnitee, in seeking indemnification or advancement of expenses,
      may
      have or to which he hereafter may be entitled under any law, provision of the
      certificate of incorporation, by-law, agreement approved by, or resolution
      of,
      the Board, or resolution of stockholders of the Company.

    


    9.  Subrogation.
      (a) The
      Company shall not be liable under this Agreement to make any payment in
      connection with any claim made against the Indemnitee to the extent the
      Indemnitee has otherwise actually received payment (under any insurance policy,
      by-law or otherwise) of the amounts otherwise subject to indemnification or
      expense advance under this Agreement.

    


    (b) In
      the
      event of payment under this Agreement, the Company shall be subrogated to the
      extent of such payment to all of the rights of recovery of the Indemnitee other
      than from the Company, and the Indemnitee shall execute all papers that
      reasonably are required and shall do everything that reasonably may be necessary
      to secure such rights, including the execution of such documents necessary
      to
      enable the Company effectively to bring suit to enforce such rights.


    


    10.  Notice
      of Claim.
      As a
      condition precedent to the right to be indemnified under this Agreement, the
      Indemnitee shall give the Company written notice as soon as practicable after
      learning about any claim made against the Indemnitee for which indemnification
      or expense advances will or could be sought under this Agreement. In addition,
      the Indemnitee shall give the Company such information and cooperation as the
      Company reasonably may require to enable the Company to perform its obligations
      hereunder. Failure to give notice shall not deprive the Indemnitee of a right
      to
      indemnification hereunder, if the Company has actual knowledge of the claim
      or
      is not adversely affected in its ability to defend the claim as a result of
      such
      failure.

     

    
      
        
        

      

      
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    11.  Severability.
      If this
      Agreement or any portion hereof shall be invalidated or held unenforceable
      on
      any ground by any court of competent jurisdiction, the Company nevertheless
      shall indemnify the Indemnitee to the fullest extent permitted by any applicable
      portion of this Agreement that shall not have been so invalidated or held
      unenforceable.

    


    12.  Continuity
      of Rights.
      (a) The
      right of the Indemnitee to indemnification and advancement of expenses under
      this Agreement shall (i) continue after the Indemnitee has ceased to serve
      in a
      capacity which would entitle the Indemnitee to indemnification or advancement
      of
      expenses pursuant to this Agreement with respect to acts or omissions occurring
      prior to such cessation, (ii) inure to the benefit of the heirs, executors
      and
      administrators of the Indemnitee, (iii) apply with respect to acts or omissions
      occurring prior to the execution and delivery of this Agreement to the fullest
      extent permitted by law and (iv) survive any restrictive amendment or
      termination of this Agreement with respect to events occurring prior to such
      amendment or termination.

    


    13.  Proceedings
      Initiated by Indemnitee.
      Other
      than to the extent provided in Section 7(c), above, the Indemnitee shall not
      be
      entitled to indemnification or advancement of expenses under this Agreement
      with
      respect to any Action initiated by the Indemnitee, but shall be entitled to
      indemnification and advancement of expenses with respect to any counterclaim
      or
      third-party claim in any such Action.

    


    14.  Binding
      Effect.
      This
      Agreement shall be binding upon all successors and assigns of the Company
      (including any transferee of all or substantially all of its assets and any
      successor by merger or operation of law) and shall inure to the benefit of
      the
      heirs, personal representatives, successors, assigns, rep-resentatives and
      estate of the Indemnitee.

    


    15.  Governing
      Law.
      This
      Agreement shall be governed by, and be construed and enforced in accordance
      with, the laws of the State of Idaho applicable to contracts made and to be
      performed in such state, without giving effect to the principles of conflicts
      of
      laws that would defer to the substantive laws of another
      jurisdiction.

    


    16.  Duration
      of Agreement.
      This
      Agreement shall continue until and terminate upon the later of (a) six (6)
      years
      after the Indemnitee has ceased to occupy any of the positions or have any
      of
      the relationships described in Section 2 of this Agreement or (b) the final
      termination of all pending or threatened Actions with respect to the Indemnitee.
      

    


    17.  Effect
      of Headings.
      The
      Section headings herein are for convenience only and shall not affect the
      construction hereof.

     

    
      
        
        

      

      
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    18.  Notices.
      All
      notices, demands, consents, requests, instructions and other communications
      hereunder to or on behalf of the Company or the Indemnitee shall be in writing
      and shall be deemed to be delivered and received by the intended recipient
      as
      follows: (a) if personally delivered, on the day of such delivery, such day
      being any day other than Saturday, Sunday and any day upon which banking
      institutions in The City of New York are required or authorized by law or other
      governmental action to close (a “Business Day”) (as evidenced by the receipt of
      the personal delivery service); (b) if mailed by certified or registered mail
      return receipt requested, four (4) Business Days after the aforesaid mailing;
      (c) if delivered by overnight courier (with all charges having been prepaid),
      on
      the second Business Day after such delivery (as evidenced by the receipt of
      the
      overnight courier service of recognized standing); or (d) if delivered by
      facsimile transmission, on the Business Day of such delivery if sent by 6:00
      p.m. in the time zone of the recipient, or if sent after that time, on the
      next
      succeeding Business Day (as evidenced by the printed confirmation of delivery
      generated by the sending party's telecopier machine). If any notice, demand,
      consent, request, instruction or other communication cannot be delivered because
      of a changed address of which no notice was given to the sender, or the refusal
      by the party to whom the notice is directed to accept same, the notice shall
      be
      deemed received on the fourth Business Day after the Business Day the notice
      is
      sent or on the day on which such acceptance is refused (as evidenced by a sworn
      affidavit of the sender). All such notices, demands, consents, requests,
      instructions and other communications will be sent to the following addresses
      or
      facsimile numbers as applicable:

     

    
 

    
      	 	If to the Indemnitee:
	 	 
	 	______________
	 	______________
	 	
              Tel:  __________ 

            
	 	Fax:  __________
	 	 
	 	If to the Company: 
	 	 
	 	
              Western
                Goldfields, Inc. 

              6502
                E. Highway 78

              Brawley,
                CA 92227


        Tel:
          (416) 324-6002


        Fax:
          (416) 324-9494

            
	 	
              Attn:  
                Brian
                Penny

              Chief
                Financial Officer

            
	 	 
	 	with copies to:
	 	 
	 	
              Henry
                I. Rothman, Esq.

              Troutman
                Sanders LLP

              The
                Chrysler Building

              405
                Lexington Avenue

              New
                York, NY 10174

              Tel:
                (212) 704-6000

              Fax:
                (212) 704-5950

            


    

     

    or
      to
      such other address as any party may specify by notice given to the other party
      in accordance with this Section 18.

     

    
      
        
        

      

      
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    19.  Counterparts.
      This
      Agreement may be executed in any number of counterparts. Each counterpart of
      an
      agreement so executed shall be deemed an original, but all such counterparts
      shall together constitute but one and the same instrument. In making proof
      of
      this Agreement, it shall not be necessary to produce or account for more than
      one counterpart.

     

    
      
        
        

      

      
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    IN
      WITNESS WHEREOF,
      the
      parties have caused this Agreement to be duly executed as of the date first
      written above. 

    


    WESTERN
      GOLDFIELDS, INC. 

    


    


    By:_________________________

         
      Name: 

         
      Title: 

    


    INDEMNITEE

    


    


    ____________________________

    Name:

     

    
      
        
        

      

      
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