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").

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.

(b)   Without limiting the scope of indemnification to which the Indemnitee is entitled under this Agreement, (i) if the Indemnitee has been s