Document:

Unassociated Document

      Exhibit
10.38

       

    

      To:

       

      Western
Mesquite Mines, Inc.

      2 Bloor
Street West

      Suite
2102

      Box
110

      Toronto,
Ontario

      Canada

      M4W
3E2

      

      Attention:
Treasurer

       

      Western
Goldfields Inc.

      2 Bloor
Street West

      Suite
2102

      Box
110

      Toronto,
Ontario

      Canada

      M4W
3E2

      

      Attention:
Chief Financial Officer

      

      Western
Goldfields (USA) Inc.

      2 Bloor
Street West

      Suite
2102

      Box
110

      Toronto,
Ontario

      Canada

      M4W
3E2

      

      Attention:
Treasurer

       

      Dear
Sirs

       

      US$105,000,000
credit agreement dated 30 March 2007 (as amended and restated by an amendment
and restatement agreement dated 31 May 2007, and as further amended by an
amendment letter dated as of 29 June 2007) between Western Mesquite Mines, Inc.
as Borrower, Western Goldfields (USA) Inc. (formerly known as Western
Goldfields, Inc.) as Guarantor, Investec Bank (UK) Limited as Agent, Mandated
Lead Arranger and Security Trustee, Commonwealth Bank of Australia as Lead
Arranger, the Banks (as defined therein) and the Hedging Banks (as defined
therein) (the “Credit Agreement”)

       

      
        	
                1. 

              	
                We
      refer to the Credit Agreement. Terms and expressions defined in the Credit
      Agreement shall
      have the same meaning when used herein unless otherwise
      defined.

              

      

      

      
        	
                2. 

              	
                You
      have informed us that the Restructure has been
  completed.

              

      

      

      
        	
                3. 

              	
                By
      signing this letter, the Financing Parties and the Hedging Banks hereby
      confirm that they approve the Restructure, and hereby waive any rights
      they may have under the Financing Documents in relation to the undertaking
      by the Guarantor to procure that the events listed in paragraphs (a) to
      (e) of Clause 11.2.3 of the Credit Agreement occur prior to the completion
      of the Restructure, provided that the following is delivered to the Agent
      (in each case in a form and substance satisfactory to the Agent) within 5
      Business Days of the date of this
letter:

              

      

       

      
        
          
          

        

        
          
          

          
            

            Page 1

        

        
          
          

        

      

       

      
        	
              	
                (a) 

              	
                a
      guarantee issued by Western Goldfields Inc. (WGOI) in favour of the Financing Parties
      and the Hedging Banks (the WGOI Guarantee) on the
      terms of the Guarantee;

              

      

       

      
        
          	
                	
                  (b)

                	
                  a
      deed of accession executed by WGOI in relation to the Credit Agreement and
      the Intercreditor Deed;

                

        

      

      

      
        
          	
                	
                  (c)

                	
                  each
      of the documents referred to in paragraph 1 of Schedule 2, Part 1 (Conditions Precedent)
      only to the extent relating to WGOI and required by Canadian
      counsel to the Finance
Parties;

                

        

      

      

      
        
          	
                	
                  (d)

                	
                  such
      know-your-customer documentation relating to WGOI and Western Goldfields
      (USA) Inc. as the Financing Parties and the Hedging Banks reasonably
      require;

                

        

      

      

      
        
          	
                	
                  (e)

                	
                  a
      legal opinion addressed to the Financing Parties and the Hedging Banks
      from Cassels, Brock & Blackwell LLP in relation to WGOI and the WGOI
      Guarantee;

                

        

      

      

      
        
          	
                	
                  (f)

                	
                  an
      acknowledgement agreement executed by Western Goldfields (USA) Inc. in
      relation to the Pledge Agreement (the Acknowledgement Agreement);
      and

                

        

      

       

      
        	
              	
                (g)

              	
                a
      legal opinion addressed to the Financing Parties and the Hedging Banks
      from Lionel Sawyer & Collins in relation to Western Goldfields USA Inc
      and the Acknowledgement Agreement..

              

      

       

      
        	
                4. 

              	
                By
      the acceptance of this letter:

              

      

      
         

        
          	
                	
                  (a) 

                	
                  you
      agree to the repetition of the Repeating Representations by yourselves by
      reference to the facts and circumstances existing on the date of this
      letter;

                

        

        

        
          	
                	
                  (b) 

                	
                  Western
      Goldfields (USA) Inc. undertakes to each Financing Party and each Hedging
      Bank
      that:

                

        

      

       

      
        	
              	
                (i)

              	
                prior
      to the Completion Date, it shall unless the Agent (acting on the
      instructions of the Majority Banks) otherwise agrees own, directly or
      indirectly, 100% of the voting rights in the Borrower;
  and

              

      

       

      
        
          	
                	
                  (ii)

                	
                  following
      the Completion Date and until expiry of the Security Period, it shall,
      unless the Agent (acting on the instructions of the Majority Banks)
      otherwise agrees own at least 50.1 % of the voting rights in the Borrower
      and provide to the Borrower such non-monetary support and assistance using
      its reasonable commercial efforts as is necessary for the Mining
      Operations to be conducted in a manner that would be expected of a
      professional, prudent operator of a mine of the size, location and
      characteristics comparable to the Project and in the manner and with the
      skill and care of a reasonable business man, provided that such support
      and assistance does not constitute a payment or performance guarantee and
      provided further that Western Goldfields (USA) Inc. shall not be liable
      for any losses, costs, expenses, damages or other amounts arising from the
      failure of the Mining Operations to be so conducted;
  and

                

        

      

      

      
        
          	
                	
                  (c)

                	
                  you
      agree that the references to “Guarantor” in Clause 13.1(a), 13.2.1(a) and
      Clause 14.1(j) of the Credit Agreement shall, instead be references to
      Western Goldfields (USA) Inc.

                

        

      

      

      
        
          	
                  5.

                	
                  Without
      prejudice to the rights of any Financing Party or Hedging Bank which have
      arisen on or before the date of this letter, by the acceptance of this
      letter you confirm that, on and after the date of this
    letter:

                

        

      

      

      
        
          	
                	
                  (a)

                	
                  the
      Credit Agreement as amended by this letter, and the other Financing
      Documents, will remain in full force and effect;
  and

                

        

      

       

      
        
           

        

        
          
          

          
            

            Page 2

        

        
           

        

      

       

      
        
          	
                	
                  (b)

                	
                  the
      Security Documents to which you are a party will continue to secure all
      liabilities which are expressed to be secured by
  them.

                

        

      

      

      
        
          	
                  6.

                	
                  Save
      as expressly stated in this letter, nothing in this letter shall constitute
      or be deemed to be a waiver or consent by the Financing Parties or Hedging
      Banks of any other provision, term or matter and none of the rights,
      duties or obligations of any party to the Financing Documents shall be
      affected or impaired by the signature or countersignature of this letter

                

        

      

      

      
        	
                7. 

              	
                This
      letter is hereby designated as a Financing
  Document.

              

      

       

      
        	
                8. 

              	
                This
      letter shall be governed by and construed in accordance with English
      law.

              

      

       

      
        	
                9.

              	
                This
      letter may be signed in any number of counterparts, and this has the same
      effect as if the signatures on the counterparts were on a single copy of
      this letter.

              

      

      

      Please
indicate your acceptance of the terms and conditions of this letter by
countersigning the copy of this letter where indicated below.

      

      
        
          
            
              
                
                  
                    
                      
                        
                          
                            
                              
                                
                                  
                                    
                                      
                                        	
                                                Yours
      faithfully

                                              	 	 
      
	 	 	 
	 	 	 
	
                                                /s/
      Michael Jones

                                              	 	
                                                 

                                              
	
                                                Investec
      Bank (UK) Limited

                                              	  
      	
                                                 
    

                                              
	
                                                (as Agent, Security Trustee, Bank and Hedging Bank)

                                              	 	 
      
	      
                                                MICHAEL
      JONES

                                                
                                                  Authorised
      Signatory

                                                

                                              	 	 
      
	 	 	 
	 	 	 
	
                                                Commonwealth
      Bank of Australia

                                              	 	 
      
	
                                                (as
      Bank and Hedging Bank)

                                              	 	 
      
	 
      	 	 
      
	
                                                Accepted
      and
      agreed, on                                              
          2007

                                              
	 
      	 	 
      
	 	 	 
	
                                                Western
      Mesquite Mines, Inc.

                                              	 	 
      
	 
      	 	 
      
	 	 	 
	
                                                Western
      Goldfields Inc.

                                              	 	 
      
	 
      	 	 
      
	 	 	 
	
                                                Western
      Goldfields (USA) Inc.

                                              	 	 
      

                                      

                                    

                                  

                                

                              

                            

                          

                        

                      

                    

                  

                

              

            

          

        

      

       

      
        
           

        

        
          
          

          
            

            Page 3

        

        
           

        

      

      

      
        
          	
                	
                  (b)

                	
                  the
      Security Documents to which you are a party will continue to secure all
      liabilities which are expressed to be secured by
  them.

                

        

      

      

      
        
          
            	
                    6.

                  	
                    Save
      as expressly stated in this letter, nothing in this letter shall
      constitute or be deemed to be a waiver or consent by the Financing Parties
      or Hedging Banks of any other provision, term or matter and none of the
      rights, duties or obligations of any party to the Financing Documents
      shall be affected or impaired by the signature or countersignature of this
      letter

                  

          

        

      

      

      
        	
                7. 

              	
                This
      letter is hereby designated as a Financing
  Document.

              

      

      

      
        
          	
                  8. 

                	
                  This
      letter shall be governed by and construed in accordance with English
      law.

                

        

      

      

      
        
          	
                  9.

                	
                  This
      letter may be signed in any number of counterparts, and this has the same
      effect as if the signatures on the counterparts were on a single copy of
      this letter.

                

        

      

      

      Please
indicate your acceptance of the terms and conditions of this letter by
countersigning the copy of this letter where indicated below.

      

      
        
          
            
              
                
                  
                    
                      
                        
                          
                            
                              
                                
                                  
                                    
                                      
                                        
                                          
                                            
                                              
                                                
                                                  
                                                    
                                                      
                                                        
                                                          
                                                            
                                                              
                                                                
                                                                  	
                                                                          Yours
      faithfully

                                                                        	 	 
	 	 	 
	 
      	 	 
	
                                                                          Investec
      Bank (UK) Limited

                                                                        	 	 
	
                                                                          (as Agent, Security Trustee, Bank and Hedging Bank)

                                                                        	 	 
	 
      	 	 
	
                                                                          /s/
      David Andrew Heuston

                                                                        	 	 
	
                                                                          Commonwealth
      Bank of Australia

                                                                        	 	 
	
                                                                          (as
      Bank and Hedging Bank)

                                                                        	 	 
	David
      Andrew Heuston	 	 
	 	 	 
	
                                                                          Accepted
      and agreed,
      on                                                
      2007

                                                                        
	
                                                                           
      

                                                                        	 	 
	 	 	 
	
                                                                          Western
      Mesquite Mines, Inc.

                                                                        	 	 
	 
      	 	 
	 	 	 
	
                                                                          Western
      Goldfields Inc.

                                                                        	 	 
	 
      	 	 
	 	 	 
	
                                                                          Western
      Goldfields (USA) Inc.

                                                                        	 	 

                                                                

                                                              

                                                            

                                                          

                                                        

                                                      

                                                    

                                                  

                                                

                                              

                                            

                                          

                                        

                                      

                                    

                                  

                                

                              

                            

                          

                        

                      

                    

                  

                

              

            

          

        

      

       

      
        
           

        

        
          
          

          
            

            Page 3

        

        
           

        

      

      

      
        
          	
                	
                  (b)

                	
                  the
      Security Documents to which you are a party will continue to secure ail
      liabilities which are expressed to be secured by
  them.

                

        

      

      

      
        
          	
                  6.

                	
                  Save
      as expressly stated in this letter, nothing in this letter shall
      constitute or be deemed to be a waiver or consent by the Financing Parties
      or Hedging Banks of any other provision, term or matter and none of the
      rights. duties or obligations of any party to the Financing Documents
      shall be affected or impaired by the signature or countersignature of this
      letter

                

        

      

      

      
        	
                7. 

              	
                This
      letter is hereby designated as a Financing
  Document.

              

      

      

      
        	
                8. 

              	
                This
      letter shall be governed by and construed in accordance with English
      law.

              

      

      

      
        
          
            	
                    9.

                  	
                    This
      letter may be signed in any number of counterparts, and this has the same
      effect as if the signatures on the counterparts were on a single copy of
      this letter.

                  

          

        

      

      

      Please
indicate your acceptance of the terms and conditions of this letter by
countersigning the copy of this letter where indicated below.

      

      
        
          
            
              
                
                  
                    
                      
                        
                          
                            
                              	
                                      Yours
      faithfully

                                    
	 
      
	 
	
                                      lnvestec
      Bank (UK) Limited

                                    
	
                                      (as
      Agent, Security Trustee, Bank and Hedging Bank)

                                    
	 
      
	 
	
                                      Commonwealth
      Bank of Australia

                                    
	
                                      (as
      Bank and Hedging Bank)

                                    
	 
      
	
                                      Accepted
      and agreed, on July 16, 2007

                                    
	 
	/s/ Brian
      Penny
	
                                      Western
      Mesquite Mines, Inc.

                                    
	 
      
	/s/ Brian
      Penny
	
                                      Western
      Goldfields Inc.

                                    
	 
	/s/ Brian
      Penny
	
                                      Western
      Goldfields (USA)
Inc.

                                    

                            

                          

                        

                      

                    

                  

                

              

            

          

        

      

       

      
        
           

        

        
          
          

          
            

            Page 3Unassociated Document

    Exhibit
10.39

     

    

      
        	
                To:

              	
                Western Mesquite Mines,
      Inc.,

              

      

      2 Bloor
Street West

      Suite
2102

      Box
110

      Toronto,
Ontario

      Canada

      M4W
3E2

      

      Attention:
Treasurer

      

      Western Goldfields Inc.

      2 Bloor
Street West

      Suite
2102

      Box
110

      Toronto,
Ontario

      Canada

      M4W
3E2

      

      Attention:
Chief Financial Officer

      

      Western
Goldfields (USA) Inc.

      2 Bloor
Street West

      Suite
2102

      Box
110

      Toronto,
Ontario

      Canada

      M4W
3E2

      

      Attention:
Treasurer

       

      14 August
2007

      

      US$105,000,000
credit agreement dated 30 March 2007 (as amended and restated by an amendment
and restatement agreement dated 31 May 2007, and as further amended by an
amendment letter dated as of 29 June 2007 and an amendment letter dated as of 16
July 2007) between Western Mesquite Mines, Inc. as Borrower, Western Goldfields
(USA) Inc. (formerly known as Western Goldfields, Inc. as Guarantor, Investec
Bank (UK) Limited as Agent, Mandated Lead Arranger and Security Trustee,
Commonwealth Bank of Australia as Lead Arranger, the Banks (as defined therein)
and the Hedging Banks (as defined therein) (the "Credit
Agreement").

       

      
        	
                1

              	
                We
      refer to the Credit Agreement. Terms and expressions defined in the Credit
      Agreement shall have the same meaning when used herein unless otherwise
      defined.

              

      

      
        
           

        

        
          Page
1

          
            

          

        

        
           

        

      

       

      
        	
                2

              	
                Further
      to our discussions concerning syndication of the Facility, the Agent, the
      Banks and the Hedging Banks hereby
      propose the following amendments to the Credit Agreement (the
      "Amendments"):

              

      

      

      
        	
                2.1

              	
                the
      definition of "Additional Drawing Conditions" shall be amended as
      follows:

              

      

      

      
        	
                2.1.1

              	
                the
      words "Agent is satisfied, acting reasonably,
      that the" shall be added to
      sub­paragraph (a) after the words "Development Plan) the";
      and

              

      

      

      
        	
                2.1.2

              	
                the
      words "by the Agent" shall be added to sub-paragraph
      (d) after the words "has been
amended";

              

      

      

      
        	
                2.2

              	
                the
      figure "20,000,000" in sub-paragraph (a) of the definition of "Approved
      Committed Equity" shall be replaced by "17,700,000";

              

      

      

      
        	
                2.3

              	
                the
      figure "85,000,000" in sub-paragraph (a) of the definition of
      "Availability Period" shall be replaced by "87,300,000";

              

      

      

      
        	
                2.4

              	
                the
      definition of "Base Case Model" shall be amended as
    follows:

              

      

      

      the word
"Monthly" shall be replaced by the word "quarterly"; and insert "as amended from time to time pursuant
to and in accordance with Clause 11.1(c)" after the word
"projections";

      

      
        	
                2.5

              	
                The
      definition of "Excess Cashflow" shall be amended to read as
      follows:

              

      

      

      "Excess Cashflow means, on any
Repayment Date, the amount by which A exceeds B

      

      where:

      

      
        	
                 
      

              	
                A

              	
                is the amount (as estimated by the Borrower on
      the Business Day falling 2 Business Days before the relevant Repayment
      Date) that will be standing to the credit of the Proceeds Account on that
      Repayment Date following the payments or transfers referred to in Clauses
      12.5.2(a) to 12.5.2(e) less the amount, if any, actually standing to the
      credit of the Proceeds Account on the previous Repayment Date following
      the payments or transfers made on that previous Repayment Date in
      accordance with Clauses 12.5.2(a) to 12.5.2(e), that was retained in the
      Proceeds Account (excluding, for the avoidance of doubt, the minimum
      retained working capital amounts) ;
and

              

      

      

      
        	
                 
      

              	
                B

              	
                is
      the minimum retained working capital amount of
    US$4,000,000."

              

      

      
        
           

        

        
          Page
2

          
            

          

        

        
           

        

      

       

      
        	
                2.6

              	
                the
      word "of" after the word "with" and before the word "the" at Schedule 2,
      Part 1, paragraph 3(f)(i) shall be
deleted;

              

      

      

      
        	
                2.7

              	
                the
      definition of "Majority Banks" shall be amended as
  follows:

              

      

      

      
        	
                2.7.1

              	
                the
      words "(x) at any time there are only
      three Banks and/or Hedging Banks, 75% or (y) at all other times," shall be
      inserted after the words "together exceed:" and before the words "662/3 per
      cent";

              

      

      

      
        	
                2.7.2

              	
                the
      words ",at anytime whilst the Bank Liabilities
      are outstanding" shall be
      inserted after the words "PROVIDED THAT" and before the words ", for
      purposes of making";

              

      

      

      
        	
                2.7.3

              	
                the
      word "and" at the
      end of sub-paragraph (B) shall be
deleted;

              

      

      

      
        	
                2.7.4

              	
                the
      full stop at the end of sub-paragraph (C) shall be replaced by "; and";

              

      

       

      
        	
                2.7.5

              	
                a new sub-paragraph
      (D) shall be inserted as follows:

              

      

       

      "(D) for the purposes of determining
whether "Majority Banks" exists, provided that there are four or more Banks
and/or Hedging Banks the 662/3 majority referred to in paragraphs
(a) and (b) must be constituted by no less than
three different Banks and/or Hedging Banks.";

      

      
        	
                2.8

              	
                sub-paragraph
      (e) of Clause 4.2 shall be deleted and replaced with a new
      sub­paragraph (e) as follows:

              

      

      

      "in respect of any Advance to be made for the
purpose of refinancing Approved Committed Equity, the Agent has notified the
Borrower and the Banks that as of such date all of the Additional Drawing
Conditions have been satisfied or waived and no Bank has responded in writing to
the Agent and the Borrower within 7 Business Days from the date of receipt of
such notice stating that any such Additional Drawing Conditions
(that have not been waived) have not been satisfied and further provided that
the Banks have received
a copy of the Base Case Model, updated as provided herein including to reflect
the anticipated Advance, with such notice; and"

      

      
        	
                2.9

              	
                the
      words "and Schedule 6 shall be amended by the Agent accordingly" at the
      end of Clause 6.1.3 shall be
deleted;

              

      

      

      
        	
                2.10

              	
                a
      new Clause 6.4.4
      shall be inserted as follows:

              

      

      

      " 6.4.4 Any prepayment pursuant to
Clause 6.4.3 shall be applied in prepayment of Repayment Instalments of the Loan
in inverse order of maturity."

      
        
           

        

        
          Page
3

          
            

          

        

        
           

        

      

       

      
        	
                2.11

              	
                the
      words "and any commitment fees" shall be added to Clause
      9.1.1(b) after the word "interest" and before the word
    "due";

              

      

      

      
        	
                2.12

              	
                the
      words "and an amount not less than
      US$4,000,000 is standing to the credit of the Proceeds Account" shall
      be added after words "complied with in full" at Clause
      11.4(i)(iv);

              

      

      

      
        	
                2.13

              	
                the
      references to
      Clauses 12.5.2(c) and 12.5.2(d) in Clause 12.6 shall be replaced with
      references to Clauses 12.5.2(d) and 12.5.2(e)
  respectively;

              

      

      

      
        	
                2.14

              	
                the
      words "or prior to"
      shall be inserted after the word "on" at Clause
    12.6.2;

              

      

      

      
        	
                2.15

              	
                the
      lettering at
      paragraph 2 of Schedule 2, Part 1 shall be amended so as to be (a), (b)
      and (c) instead of (h), (i) and
(j);

              

      

      

      
        	
                2.16

              	
                the
      lettering at
      paragraph 3 of Schedule 2, Part 1 shall be amended so as to be (a), (b),
      (c), (d), (e), (f) and (g) instead of (k), (l), (m), (n), (o), (f) and
      (g);

              

      

      

      
        	
                2.17

              	
                Schedule 9 shall be
      amended as follows:

              

      

       

      
        	
                2.17.1

              	
                paragraph 4 shall be
      replaced by the following:

              

      

       

      "The
Additional Cost Rate for any Bank lending from a Facility Office in the United
Kingdom will be calculated by the Agent as follows:

      

      
        	
                 
      

              	
                E
      x 0.01       per cent per
      annum

              

      

      
        	
                 
      

              	
                  
      300

              

      

      

      Where
E is designed to compensate Lenders for amounts payable under the Fees Rules and
is calculated by the Agent as being the average of the most recent rates of
charge supplied by the Reference Banks to the Agent pursuant to paragraph 6
below and expressed in pounds per £1,000,000.";

      

      
        	
                2.17.2

              	
                paragraph 5(a) shall be
      amended as follows:

              

      

      

      
        	
                 
      

              	
                (a)

              	
                the
      words
      "Eligible Liabilities and" shall be
deleted;

              

      

      

      
        	
                 
      

              	
                (b)

              	
                the word "have"
      after "Special Deposits" shall be replaced by the word "has";

              

      

      

      
        	
                 
      

              	
                (c)

              	
                the
      word
      "meanings" shall be replaced by the word "meaning";
and

              

      

      

      
        	
                 
      

              	
                (d)

              	
                the
      word
      "them" after the words "meanings given to" shall be replaced by the word
      "it";

              

      

      

      
        	
                2.17.3

              	
                paragraph 6 shall be
      deleted and the remaining paragraphs shall be renumbered accordingly;
      and

              

      

      

      
        	
                2.17.4

              	
                the words "The percentages of
      each Bank for the purpose of A and C above and the " at the beginning of paragraph 9 shall be replace
      by the word "The";

              

      

      
        
           

        

        
          Page
4

          
            

          

        

        
           

        

      

       

      
        	
                2.18

              	
                the
      reference to
      paragraph 4 in Schedule 15, paragraph 3(a) shall be replaced with a
      reference to paragraph 2;

              

      

      

      
        	
                2.19

              	
                the
      amendments agreed in paragraph 4(c) of the letter agreement relating to
      the Credit Agreement
      (the Letter Agreement)
      dated 16 July 2007 shall be deleted and replaced as
      follows:

              

      

      

      
        	
                2.19.1

              	
                ",directly
      or indirectly," shall be inserted into the third line of Clause
      11.2.2 after "otherwise agrees own" and before "at least 50.1
      %";

              

      

      

      
        	
                2.19.2

              	
                "and
      Western Goldfields (USA) Inc."
      shall be inserted into the third line of Clause 13.1(a) after "the
      Guarantor" and before "only";

              

      

      

      
        	
                2.19.3

              	
                ",
      in the case of the Guarantor" shall
      be inserted into the fifth line of Clause 13.1(a) after "under" and before
      "each of";

              

      

      

      
        	
                2.19.4

              	
                "and, in the case of Western Goldfields
      (USA) Inc., paragraph 4(b) of the Letter Agreement" shall be inserted into the
      fifth line of Clause 13.1(a) after "Clause 11.2.2" and before "(which
      shall be";

              

      

      

      
        	
                2.19.5

              	
                "or Western Goldfields (USA) Inc." shall be inserted into the
      first line of Clause 14.1(j)(i) after "the Guarantor" and before
      "transfers";

              

      

      

      
        	
                2.19.6

              	
                "direct
      or indirect'
      shall be inserted into the first line of Clause 14.1(j)(i) after
      "any" and before "interest";

              

      

      

      
        	
                2.19.7

              	
                ",
      in the case of the Guarantor, or paragraph 4(b) of the Letter Agreement,
      in the case of Western Goldfields (USA) Inc." shall be inserted into the
      second line of Clause 14.1 (j)(i) after "Clause 11.2" and before "); or";
      and

              

      

      

      
        	
                2.19.8

              	
                the
      words ",directly or
      indirectly," shall be deleted from the undertaking in paragraph 4(b) of
      the Letter Agreement.

              

      

      

      
        	
                3

              	
                By
      the acceptance of
      this letter you confirm that your respective certificates of incorporation
      (and any relative certificate of incorporation on change of name) and your
      respective memorandum and articles of association have not been amended or
      varied since 16 July 2007.

              

      

      

      
        	
                4

              	
                By
      the acceptance of this letter you agree to the repetition of the Repeating
      Representations by
      yourselves by reference to the facts and circumstances existing on the
      date of this letter.

              

      

      

      
        	
                5

              	
                Without
      prejudice to the rights of any Financing Party which have arisen on or
      before the date of this letter, by the acceptance
      of this letter you confirm that, on and after the date of this
      letter:

              

      

      

      
        	
                 
      

              	
                (a)

              	
                the
      Credit Agreement as amended by this letter, and the other Financing
      Documents, will remain in full force and
effect;

              

      

      
        
           

        

        
          Page
5

          
            

          

        

        
           

        

      

       

      
        	
                 
      

              	
                (b)

              	
                the
      Security Documents to which you are a party remain in full force and
      effect as valid and binding continuing security in accordance with their
      terms without impairment or novation thereof for all liabilities which are
      expressed to be secured by them;
and

              

      

      

      
        	
                 
      

              	
                (c)

              	
                all
      adjustments
      or modifications, if any, to the obligations underlying the Security
      Documents to which you are a party have been made and are permitted under
      the terms and conditions of such Security
  Documents.

              

      

      

      
        	
                6

              	
                Each
      of you represent and
      warrant that this letter has been duly authorised, executed and delivered
      by you.

              

      

      

      
        	
                7

              	
                This
      letter is hereby
      designated as a Financing Document.

              

      

      

      
        	
                8

              	
                This
      letter shall be
      governed by and construed in accordance with English
  law.

              

      

      

      
        	
                9

              	
                This
      letter may be signed
      in any number of counterparts, and this has the same effect as if the
      signatures on the counterparts were on a single copy of this
      letter.

              

      

      

      Please
indicate your acceptance of the terms and conditions of this letter by
countersigning the copy of this letter where indicated below.

      

      
        
          
            
              
                
                  
                    
                      
                        
                          
                            
                              
                                
                                  
                                    
                                      
                                        
                                          
                                            
                                              
                                                
                                                  
                                                    
                                                      
                                                        
                                                          
                                                            
                                                              
                                                                
                                                                  
                                                                    
                                                                      
                                                                        
                                                                          
                                                                            
                                                                              
                                                                                
                                                                                  	
                                                                                          Yours
      faithfully

                                                                                        
	 
	/s/
      Anthony Rowe and /s/ Ian Wohlman
	
                                                                                          Investec
      Bank (UK) Limited

                                                                                        
	
                                                                                          (as
      Agent, Bank and Hedging Bank)

                                                                                        
	 
      
	 
      
	
                                                                                          Commonwealth Bank of Australia

                                                                                        
	
                                                                                          (as
      Bank and Hedging Bank)

                                                                                        
	 
      
	 
	
                                                                                          Accepted
      and agreed,
      on                         
      August 2007

                                                                                        
	 
	 
	
                                                                                          Western
      Mesquite Mines, Inc.

                                                                                        
	 
	 
	
                                                                                          Western
      Goldfields Inc.

                                                                                        
	 
	 
	
                                                                                          Western
      Goldfields (USA)
Inc.

                                                                                        

                                                                                

                                                                              

                                                                            

                                                                          

                                                                        

                                                                      

                                                                    

                                                                  

                                                                

                                                              

                                                            

                                                          

                                                        

                                                      

                                                    

                                                  

                                                

                                              

                                            

                                          

                                        

                                      

                                    

                                  

                                

                              

                            

                          

                        

                      

                    

                  

                

              

            

          

        

      

      
        
           

        

        
          Page
6

          
            

          

        

        
           

        

      

    

     

    
      
        	
                 
      

              	
                (b)

              	
                the
      Security Documents to which you are a party remain in full force and
      effect as valid and binding continuing security in accordance with their
      terms without impairment or novation thereof for all liabilities which are
      expressed to be secured by them;
and

              

      

      

      
        	
                 
      

              	
                (c)

              	
                all
      adjustments
      or modifications, if any, to the obligations underlying the Security
      Documents to which you are a party have been made and are permitted under
      the terms and conditions of such Security
  Documents.

              

      

      

      
        	
                6

              	
                Each
      of you represent and
      warrant that this letter has been duly authorised, executed and delivered
      by you.

              

      

      

      
        	
                7

              	
                This
      letter is hereby
      designated as a Financing Document.

              

      

      

      
        	
                8

              	
                This
      letter shall be
      governed by and construed in accordance with English
  law.

              

      

      

      
        	
                9

              	
                This
      letter may be signed
      in any number of counterparts, and this has the same effect as if the
      signatures on the counterparts were on a single copy of this
      letter.

              

      

      

      Please
indicate your acceptance of the terms and conditions of this letter by
countersigning the copy of this letter where indicated below.

      

      
        
          
            
              
                
                  
                    
                      
                        
                          
                            
                              
                                
                                  
                                    
                                      
                                        
                                          
                                            
                                              
                                                
                                                  
                                                    
                                                      
                                                        
                                                          
                                                            
                                                              
                                                                
                                                                  
                                                                    
                                                                      
                                                                        
                                                                          
                                                                            
                                                                              
                                                                                
                                                                                  	
                                                                                          Yours
      faithfully

                                                                                        
	 
	 
	
                                                                                          Investec
      Bank (UK) Limited

                                                                                        
	
                                                                                          (as
      Agent, Bank and Hedging Bank)

                                                                                        
	 
      
	/s/
      Jeff Heazlewood
	
                                                                                          Commonwealth Bank of Australia

                                                                                        
	
                                                                                          (as
      Bank and Hedging Bank)

                                                                                        
	 
      
	 
	
                                                                                          Accepted
      and agreed,
      on                         
      August 2007

                                                                                        
	 
	/s/ Brian
      Penny
	
                                                                                          Western
      Mesquite Mines, Inc.

                                                                                        
	 
	/s/
      Brian
      Penny
	
                                                                                          Western
      Goldfields Inc.

                                                                                        
	 
	/s/
      Brian
      Penny
	
                                                                                          Western
      Goldfields (USA)
Inc.

                                                                                        

                                                                                

                                                                              

                                                                            

                                                                          

                                                                        

                                                                      

                                                                    

                                                                  

                                                                

                                                              

                                                            

                                                          

                                                        

                                                      

                                                    

                                                  

                                                

                                              

                                            

                                          

                                        

                                      

                                    

                                  

                                

                              

                            

                          

                        

                      

                    

                  

                

              

            

          

        

      

      
        
           

        

        
          Page
6

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00155-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00155-of-00352.parquet"}]]