EXHIBIT 10.1
 

 
SECURITIES PURCHASE AGREEMENT
 
This Securities Purchase Agreement (this “Agreement”) is dated as of March 25,
2009, among Mexoro Minerals Ltd. (the “Company”), and OHAG Holdings Ltd.
(including its successors and assigns) the “Purchaser”.
 
WHEREAS, subject to the terms and conditions set forth in this Agreement and
pursuant to Section 4(2) of the Securities Act of 1933, as amended (the
“Securities Act”) and Rule 506 promulgated thereunder, the Company desires to
issue and sell to the Purchaser, and the Purchaser desires to purchase from the
Company, securities of the Company as more fully described in this Agreement.
 
NOW, THEREFORE, IN CONSIDERATION of the mutual covenants contained in this
Agreement, and for other good and valuable consideration the receipt and
adequacy of which are hereby acknowledged, the Company and the Purchaser agree
as follows:
 
ARTICLE I.
 
DEFINITIONS
 
1.1 Definitions
 
.  In addition to the terms defined elsewhere in this Agreement, for all
purposes of this Agreement, the following terms have the meanings indicated in
this Section 1.1:
 
“Ayub Guarantee” shall mean that Affiliate Guarantee in the form attached hereto
as Exhibit G.
 
“Closing” means the closing of the purchase and sale of the Securities pursuant
to Section 2.1.
 
“Closing Date” means the Trading Day when all of the Transaction Documents have
been executed and delivered by the applicable parties thereto, and all
conditions precedent to (i) the Purchaser’s obligations to pay the Subscription
Amount and (ii) the Company’s obligations to deliver the Securities have been
satisfied or waived.
 
“Commission” means the Securities and Exchange Commission.
 
“Common Stock” means the common stock of the Company, no par value per share,
and any other class of securities into which such securities may hereafter have
been reclassified or changed into.
 
“Common Stock Equivalents” means any securities of the Company or the
Subsidiaries which would entitle the holder thereof to acquire at any time
Common Stock, including, without limitation, any debt, preferred stock, rights,
options, warrants or other instrument that is at any time convertible into or
exercisable or exchangeable for, or otherwise entitles the holder thereof to
receive, Common Stock.
 
“Company Counsel” means FMC.
 
“Conversion Price” shall have the meaning ascribed to such term in the
Debentures.

“Debenture” means the convertible debenture agreement, dated the date hereof,
among the Company and the Purchaser, in the form of Exhibit A attached hereto.

“Escrow Shares” has the meaning set out in Section 2.1.

“Exchange Act” means the Securities Exchange Act of 1934, as amended, and the
rules and regulations promulgated thereunder.

“Funds Escrow Agent” shall mean FMC.

“Funds Escrow Agreement” shall mean the escrow agreement concerning the transfer
of funds, dated the date hereof, between the Company, Purchaser and the Escrow
Agent, in the form of Exhibit D attached hereto.
 
 “Person” means an individual or corporation, partnership, trust, incorporated
or unincorporated association, joint venture, limited liability company, joint
stock company, government (or an agency or subdivision thereof) or other entity
of any kind.
 
 “Proceeding” means an action, claim, suit, investigation or proceeding
(including, without limitation, an investigation or partial proceeding, such as
a deposition), whether commenced or threatened.
 
“MRT Purchase Agreement” means the Purchase Agreement, dated the date hereof,
among the Company and the Purchaser, in the form of Exhibit E attached hereto.
 
“Securities” means the Debentures, warrants, the Underlying Shares, the Escrow
Shares and the Initial Shares.
 
“Securities Act” means the Securities Act of 1933, as amended.
 
“Security Agreements” means the Mexoro General Security Agreement, dated the
date hereof, among the Company and the Purchaser, in the form of Exhibit B
attached hereto and the Sunburst General Security Agreement, in the form of
Exhibit C attached hereto.

“Shares Escrow Agent” shall mean Sanders Ortoli Vaughn-Flam Rosenstadt LLP.

“Shares Escrow Agreement” shall mean the escrow agreement concerning the Escrow
Shares, dated the date hereof, between the Company, Purchaser and the Escrow
Agent, in the form of Exhibit F attached hereto.
 
“Short Sales” shall include all “short sales” as defined in Rule 200 of
Regulation SHO under the Exchange Act (but shall not be deemed to include the
location and/or reservation of borrowable shares of Common Stock). 
 
“FMC” shall mean Fraser Milner Casgrain LLP, 100 King Street West, Toronto,
Ontario, M5X 1B2, Canada.
 
“Subscription Amount” means, as to the Purchaser, the aggregate amount to be
paid for the Debentures and warrants purchased hereunder as specified below such
Purchaser’s name on the signature page of this Agreement and next to the heading
“Subscription Amount”, in United States Dollars and in immediately available
funds.
 
“Trading Day” means a day on which the Common Stock is traded on a Trading
Market.
 
“Trading Market” means the following markets or exchanges on which the Common
Stock is listed or quoted for trading on the date in question: the Nasdaq
Capital Market, the American Stock Exchange, the New York Stock Exchange, the
Nasdaq National Market, the OTC Bulletin Board or the Pink Sheets.
 
“Transaction Documents” means this Agreement, the Funds Escrow Agreement, the
Shares Escrow Agreement, the Debenture and the Security Agreements and any other
documents or agreements executed in connection with the transactions
contemplated hereunder.
 
“Underlying Shares” means the shares of Common Stock issued and issuable upon
conversion or redemption of the Debentures and upon exercise of the warrants in
accordance with the terms of the Debentures.
 
ARTICLE II.
 
PURCHASE AND SALE
 
2.1 Closing.  Upon satisfaction of the conditions set forth in Sections 2.2 and
2.3, the Closing shall occur at the offices of FMC, or such other location as
the parties shall mutually agree.  On the Closing Date, upon the terms and
subject to the conditions set forth herein, concurrent with the execution and
delivery of this Agreement by the parties hereto:
 
(a) the Company agrees to sell, and the Purchaser agrees to purchase $250,000 of
Debentures.  The Purchaser shall deliver to the Escrow Agent via wire transfer
or a certified check immediately available funds equal to its Subscription
Amount and the Company shall deliver to the Purchaser its Debenture and the
other items set forth in Section 2.2 issuable at the Closing;
 
(b) subject to Section 2.4(a) of this Agreement, the Company shall deliver a
certificate in OHAG’s name representing 250,000 of the Company’s common stock
(the “Initial Shares”), which certificate shall contain the common legends
pertaining to securities sold in reliance of the exemptions from the Securities
Act of 1933 provided by Regulation D and/or Regulation S and shall record the
ownership of those shares of common stock on its books (or instruct its transfer
agent to record such ownership; and
 
(c)  the Company shall place a certificate in the name of OHAG representing
2,250,000 of its common shares into escrow (the “Escrow Shares”) with the Shares
Escrow Agent.  The Parties hereto agree that if (i) the Lender does exercise its
right to notify Minera Rio Tinto that it will not sell the Debenture pursuant to
Section 4 of the MRT Purchase Agreement and (ii) none of Minera Rio Tinto, the
Company or Mario Ayub purchase the Debenture from the Lender under the MRT
Purchase Agreement, then the Shares Escrow Agent is hereby instructed to release
the Escrow Shares to the Lender.  Such release shall be irrevocable and if the
receipt of the Escrow Shares is not sufficient to cover the amount of the
Debenture or any other obligations owing to the Lender under this or the MRT
Purchase Agreement, the Company shall be liable for the difference in the value
of the Escrow Shares and the Debenture and any amounts owed under other
obligations owing to the Lender under this or the MRT Purchase Agreement.
 
2.2 Deliveries
 
.
 
(a) On or prior to the Closing Date, the Company shall deliver or cause to be
delivered to the Purchaser the following:
 
(i) this Agreement duly executed by the Company;
 
(ii) a Debenture duly executed by the Company with a principal amount equal to
such Purchaser’s Subscription Amount, registered in the name of such Purchaser;
and
 
(iii) the Security Agreements, duly executed by the Company;
 
(iv) the Funds Escrow Agreement, duly executed by the Company;
 
(v) the Shares Escrow Agreement;
 
(vi) the Escrow Shares (to be delivered to the Shares Escrow Agent); and
 
(vii) the MRT Purchase Agreement, duly executed by MRT and the Company; and
 
(viii) the Ayub Guarantee, duly executed by Mario Ayub.
 
(b) On or prior to the Closing Date, the Purchaser shall deliver or cause to be
delivered to the Company (except as noted) the following:
 
(i) this Agreement duly executed by such Purchaser;
 
(ii) the Security Agreements, duly executed by the Purchaser;
 
(iii) the Funds Escrow Agreement, duly executed by the Purchaser;
 
(iv) the Shares Escrow Agreement;
 
(v) such Purchaser’s Subscription Amount (cash Subscription Amounts to be
delivered to the Escrow Agent); and
 
(vi) the MRT Purchase Agreement, duly executed by Purchaser.
 
2.3 Closing Conditions.
 
(a)           The obligations of the Company hereunder in connection with the
Closing are subject to the following conditions being met:
 
(i) the accuracy in all material respects when made and on the Closing Date of
the representations and warranties of the Purchaser contained herein;
 
(ii) all obligations, covenants and agreements of the Purchaser required to be
performed at or prior to the Closing Date shall have been performed; and
 
(iii) the delivery by the Purchaser of the items set forth in Section 2.2(b) of
this Agreement.
 
(b) The obligations of the Purchaser hereunder in connection with the Closing
are subject to the following conditions being met:
 
(i) the accuracy in all material respects on the Closing Date of the
representations and warranties of the Company contained herein;
 
(ii) all obligations, covenants and agreements of the Company required to be
performed at or prior to the Closing Date shall have been performed; and
 
(iii) the delivery by the Company of the items set forth in Section 2.2(a) of
this Agreement.
 
2.4 Condition Subsequent
 
(a) Within 30 days of Closing, the Company shall deliver to the Escrow Agent a
certificate representing 250,000 shares of the Company’s common stock, which
shall contain no legends or restrictions on transfer and shall be free of all
liens or encumbrances of any kind (“Replacement Shares”). Upon receipt of such
Replacement Shares, the Escrow Agent shall inform OHAG of such receipt and OHAG
shall return the Initial Shares to the Escrow Agent. Upon receipt by the Escrow
Agent of the Initial Shares and Replacement Shares, the Escrow Agent shall
promptly deliver the Replacement Shares to OHAG and the Initial Shares to the
Company without further instructions from either party.
 
 
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ARTICLE III.
 
REPRESENTATIONS AND WARRANTIES
 
3.1 Representations and Warranties of the Company.  T
 
Except as set forth under the corresponding section of the disclosure schedules
delivered to the Purchasers concurrently herewith (the “Disclosure Schedules”)
which Disclosure Schedules shall be deemed a part hereof, the Company hereby
makes the representations and warranties set forth below to each PurchasTTTThe
Company makes the representations and warranties set forth below to the
Purchaser:
 
(a) Organization and Qualification.  The Company is an entity duly incorporated
or otherwise organized, validly existing and in good standing under the laws of
the jurisdiction of its incorporation or organization (as applicable), with the
requisite power and authority to own and use its properties and assets and to
carry on its business as currently conducted.  Neither the Company nor any
Subsidiary is in violation or default of any of the provisions of its respective
certificate or articles of incorporation, bylaws or other organizational or
charter documents.  Each of the Company and the subsidiaries is duly qualified
to conduct business and is in good standing as a foreign corporation or other
entity in each jurisdiction in which the nature of the business conducted or
property owned by it makes such qualification necessary, except where the
failure to be so qualified or in good standing, as the case may be, could not
have or reasonably be expected to result in (i) a material adverse effect on the
legality, validity or enforceability of any Transaction Document, (ii) a
material adverse effect on the results of operations, assets, business,
prospects or condition (financial or otherwise) of the Company and the
Subsidiaries, taken as a whole, or (iii) a material adverse effect on the
Company’s ability to perform in any material respect on a timely basis its
obligations under any Transaction Document (any of (i), (ii) or (iii), a
“Material Adverse Effect”) and no Proceeding has been instituted in any such
jurisdiction revoking, limiting or curtailing or seeking to revoke, limit or
curtail such power and authority or qualification.
 
(b) Authorization; Enforcement.  The Company has the requisite corporate power
and authority to enter into and to consummate the transactions contemplated by
each of the Transaction Documents and otherwise to carry out its obligations
hereunder and thereunder.  The execution and delivery of each of the Transaction
Documents by the Company and the consummation by it of the transactions
contemplated thereby have been duly authorized by all necessary action on the
part of the Company and no further action is required by the Company, its board
of directors or its stockholders in connection therewith other than in
connection with the Required Approvals.  Each Transaction Document has been (or
upon delivery will have been) duly executed by the Company and, when delivered
in accordance with the terms hereof and thereof, will constitute the valid and
binding obligation of the Company enforceable against the Company in accordance
with its terms except (i) as limited by applicable bankruptcy, insolvency,
reorganization, moratorium and other laws of general application affecting
enforcement of creditors’ rights generally and (ii) as limited by laws relating
to the availability of specific performance, injunctive relief or other
equitable remedies.
 
(c) Valid Issuance of Securities.   The Securities, when issued, sold and
delivered in accordance with the terms and for the consideration set forth in
this Agreement, will be validly issued, fully paid and nonassessable and free of
restrictions on transfer other than restrictions on transfer under the
Transaction Agreements, applicable state and federal securities laws and liens
or encumbrances created by or imposed by a purchaser.  Assuming the accuracy of
the representations of the Purchaser, the Securities will be issued in
compliance with all applicable federal and state securities laws.  The Common
Stock issuable upon conversion of the Securities or exercise of the Warrants has
been duly reserved for issuance and will be validly issued, fully paid and
nonassessable and free of restrictions on transfer other than restrictions on
transfer under applicable federal and state securities laws and liens or
encumbrances created by or imposed by the Purchaser.
 
3.2 Representations and Warranties of the Purchaser
 
.  The Purchaser hereby, for itself and for no other Purchaser, represents and
warrants as of the date hereof and as of the Closing Date to the Company as
follows:
 
(a) Organization; Authority.  Such Purchaser is an entity duly organized,
validly existing and in good standing under the laws of the jurisdiction of its
organization with full right, corporate or partnership power and authority to
enter into and to consummate the transactions contemplated by the Transaction
Documents and otherwise to carry out its obligations hereunder and thereunder.
The execution, delivery and performance by such Purchaser of the transactions
contemplated by this Agreement have been duly authorized by all necessary
corporate or similar action on the part of such Purchaser.  Each Transaction
Document to which it is a party has been duly executed by such Purchaser, and
when delivered by such Purchaser in accordance with the terms hereof, will
constitute the valid and legally binding obligation of such Purchaser,
enforceable against it in accordance with its terms, except (i) as limited by
general equitable principles and applicable bankruptcy, insolvency,
reorganization, moratorium and other laws of general application affecting
enforcement of creditors’ rights generally, (ii) as limited by laws relating to
the availability of specific performance, injunctive relief or other equitable
remedies and (iii) insofar as indemnification and contribution provisions may be
limited by applicable law.
 
(b) Own Account.  Such Purchaser understands that the Securities are “restricted
securities” and have not been registered under the Securities Act or any
applicable state securities law and is acquiring the Securities as principal for
its own account and not with a view to or for distributing or reselling such
Securities or any part thereof in violation of the Securities Act or any
applicable state securities law, has no present intention of distributing any of
such Securities in violation of the Securities Act or any applicable state
securities law and has no arrangement or understanding with any other persons
regarding the distribution of such Securities (this representation and warranty
not limiting such Purchaser’s right to sell the Securities pursuant to the
Registration Statement or otherwise in compliance with applicable federal and
state securities laws) in violation of the Securities Act or any applicable
state securities law.  Such Purchaser is acquiring the Securities hereunder in
the ordinary course of its business. Such Purchaser does not have any agreement
or understanding, directly or indirectly, with any Person to distribute any of
the Securities.
 
(c) Purchaser Status.  At the time such Purchaser was offered the Securities, it
was, and at the date hereof it is, and on each date on which it converts any
Debentures it will be either: (i) an “accredited investor” as defined in Rule
501(a)(1), (a)(2), (a)(3), (a)(7) or (a)(8) under the Securities Act or (ii) a
“qualified institutional buyer” as defined in Rule 144A(a) under the Securities
Act.  Such Purchaser is not required to be registered as a broker-dealer under
Section 15 of the Exchange Act.
 
(d) Experience of Such Purchaser.  Such Purchaser, either alone or together with
its representatives, has such knowledge, sophistication and experience in
business and financial matters so as to be capable of evaluating the merits and
risks of the prospective investment in the Securities, and has so evaluated the
merits and risks of such investment.  Such Purchaser is able to bear the
economic risk of an investment in the Securities and, at the present time, is
able to afford a complete loss of such investment.
 
(e) General Solicitation.  Such Purchaser is not purchasing the Securities as a
result of any advertisement, article, notice or other communication regarding
the Securities published in any newspaper, magazine or similar media or
broadcast over television or radio or presented at any seminar or any other
general solicitation or general advertisement.
 
(f) Short Sales and Confidentiality Prior To The Date Hereof.  Other than the
transaction contemplated hereunder, such Purchaser has not directly or
indirectly, nor has any Person acting on behalf of or pursuant to any
understanding with such Purchaser, executed any disposition, including Short
Sales, in the securities of the Company during the period commencing from the
time that such Purchaser first received a term sheet from the Company or any
other Person setting forth the material terms of the transactions contemplated
hereunder until the date hereof (“Discussion Time”).  Notwithstanding the
foregoing, in the case of a Purchaser that is a multi-managed investment vehicle
whereby separate portfolio managers manage separate portions of such Purchaser's
assets and the portfolio managers have no direct knowledge of the investment
decisions made by the portfolio managers managing other portions of such
Purchaser's assets, the representation set forth above shall only apply with
respect to the portion of assets managed by the portfolio manager that made the
investment decision to purchase the Securities covered by this Agreement.  Other
than to other Persons party to this Agreement, such Purchaser has maintained the
confidentiality of all disclosures made to it in connection with this
transaction (including the existence and terms of this transaction).
 
The Company acknowledges and agrees that the Purchaser does not make or has not
made any representations or warranties with respect to the transactions
contemplated hereby other than those specifically set forth in this Section 3.2.
 

ARTICLE IV.
 
MISCELLANEOUS
 
4.1 Termination.  This Agreement may be terminated by any Purchaser, as to such
Purchaser’s obligations hereunder only and without any effect whatsoever on the
obligations between the Company and the other Purchaser, by written notice to
the other parties, if the Closing has not been consummated on or before March
31, 2009; provided, however, that no such termination will affect the right of
any party to sue for any breach by the other party (or parties).  The Company
retains the exclusive, unilateral right to delay termination on March 31, 2009
for an additional 30 days.
 
4.2 Fees and Expenses.  At the Closing, the Company has agreed to reimburse FMC
the non-accountable sum of $[______], for serving as escrow agent, of which
shall have been paid prior to the Closing.  Except as expressly set forth in the
Transaction Documents to the contrary, each party shall pay the fees and
expenses of its advisers, counsel, accountants and other experts, if any, and
all other expenses incurred by such party incident to the negotiation,
preparation, execution, delivery and performance of this Agreement.  The Company
shall pay all transfer agent fees, stamp taxes and other taxes and duties levied
in connection with the delivery of any Securities.
 
4.3 Entire Agreement.  The Transaction Documents, together with the exhibits and
schedules thereto, contain the entire understanding of the parties with respect
to the subject matter hereof and supersede all prior agreements and
understandings, oral or written, with respect to such matters, which the parties
acknowledge have been merged into such documents, exhibits and schedules.
 
4.4 Notices.  Any and all notices or other communications or deliveries required
or permitted to be provided hereunder shall be in writing and shall be deemed
given and effective on the earliest of (a) the date of transmission, if such
notice or communication is delivered via facsimile at the facsimile number set
forth on the signature pages attached hereto prior to 5:30 p.m. (New York City
time) on a Trading Day, (b) the next Trading Day after the date of transmission,
if such notice or communication is delivered via facsimile at the facsimile
number set forth on the signature pages attached hereto on a day that is not a
Trading Day or later than 5:30 p.m. (New York City time) on any Trading Day, (c)
the 2nd Trading Day following the date of mailing, if sent by U.S. nationally
recognized overnight courier service, or (d) upon actual receipt by the party to
whom such notice is required to be given.  The address for such notices and
communications shall be as set forth on the signature pages attached hereto.
 
4.5 Headings.  The headings herein are for convenience only, do not constitute a
part of this Agreement and shall not be deemed to limit or affect any of the
provisions hereof.  The language used in this Agreement will be deemed to be the
language chosen by the parties to express their mutual intent, and no rules of
strict construction will be applied against any party.
 
4.6 Successors and Assigns.  This Agreement shall be binding upon and inure to
the benefit of the parties and their successors and permitted assigns.  The
Company may not assign this Agreement or any rights or obligations hereunder
without the prior written consent of the Purchaser.  Any Purchaser may assign
any or all of its rights under this Agreement to any Person to whom such
Purchaser assigns or transfers any Securities, provided such transferee agrees
in writing to be bound, with respect to the transferred Securities, by the
provisions hereof that apply to the “Purchaser”.
 
4.7 No Third-Party Beneficiaries.  This Agreement is intended for the benefit of
the parties hereto and their respective successors and permitted assigns and is
not for the benefit of, nor may any provision hereof be enforced by, any other
Person.
 
4.8 Governing Law.  All questions concerning the construction, validity,
enforcement and interpretation of the Transaction Documents shall be governed by
and construed and enforced in accordance with the internal laws of the State of
New York, without regard to the principles of conflicts of law thereof.  Each
party agrees that all legal proceedings concerning the interpretations,
enforcement and defense of the transactions contemplated by this Agreement and
any other Transaction Documents (whether brought against a party hereto or its
respective affiliates, directors, officers, shareholders, employees or agents)
shall be commenced exclusively in the state and federal courts sitting in the
City of New York. Each party hereby irrevocably submits to the exclusive
jurisdiction of the state and federal courts sitting in the City of New York,
borough of Manhattan for the adjudication of any dispute hereunder or in
connection herewith or with any transaction contemplated hereby or discussed
herein (including with respect to the enforcement of any of the Transaction
Documents), and hereby irrevocably waives, and agrees not to assert in any suit,
action or proceeding, any claim that it is not personally subject to the
jurisdiction of any such court, that such suit, action or proceeding is improper
or inconvenient venue for such proceeding.  Each party hereby irrevocably waives
personal service of process and consents to process being served in any such
suit, action or proceeding by mailing a copy thereof via registered or certified
mail or overnight delivery (with evidence of delivery) to such party at the
address in effect for notices to it under this Agreement and agrees that such
service shall constitute good and sufficient service of process and notice
thereof.  Nothing contained herein shall be deemed to limit in any way any right
to serve process in any manner permitted by law.  The parties hereby waive all
rights to a trial by jury.  If either party shall commence an action or
proceeding to enforce any provisions of the Transaction Documents, then the
prevailing party in such action or proceeding shall be reimbursed by the other
party for its attorneys’ fees and other costs and expenses incurred with the
investigation, preparation and prosecution of such action or proceeding.
 
4.9 Survival.  The representations and warranties contained herein shall survive
the Closing and the delivery of the Securities.
 
4.10 Execution.  This Agreement may be executed in two or more counterparts, all
of which when taken together shall be considered one and the same agreement and
shall become effective when counterparts have been signed by each party and
delivered to the other party, it being understood that both parties need not
sign the same counterpart.  In the event that any signature is delivered by
facsimile transmission, such signature shall create a valid and binding
obligation of the party executing (or on whose behalf such signature is
executed) with the same force and effect as if such facsimile signature page
were an original thereof.
 
4.11 Severability.  If any provision of this Agreement is held to be invalid or
unenforceable in any respect, the validity and enforceability of the remaining
terms and provisions of this Agreement shall not in any way be affected or
impaired thereby and the parties will attempt to agree upon a valid and
enforceable provision that is a reasonable substitute therefor, and upon so
agreeing, shall incorporate such substitute provision in this Agreement.
 
4.12 Rescission and Withdrawal Right.  Notwithstanding anything to the contrary
contained in (and without limiting any similar provisions of) the Transaction
Documents, whenever any Purchaser exercises a right, election, demand or option
under a Transaction Document and the Company does not timely perform its related
obligations within the periods therein provided, then such Purchaser may rescind
or withdraw, in its sole discretion from time to time upon written notice to the
Company, any relevant notice, demand or election in whole or in part without
prejudice to its future actions and rights.
 
4.13 Remedies.  In addition to being entitled to exercise all rights provided
herein or granted by law, including recovery of damages, the Purchaser and the
Company will be entitled to specific performance under the Transaction
Documents.  The parties agree that monetary damages may not be adequate
compensation for any loss incurred by reason of any breach of obligations
described in the foregoing sentence and hereby agrees to waive in any action for
specific performance of any such obligation the defense that a remedy at law
would be adequate.
 
4.14 Payment Set Aside.  To the extent that the Company makes a payment or
payments to any Purchaser pursuant to any Transaction Document or a Purchaser
enforces or exercises its rights thereunder, and such payment or payments or the
proceeds of such enforcement or exercise or any part thereof are subsequently
invalidated, declared to be fraudulent or preferential, set aside, recovered
from, disgorged by or are required to be refunded, repaid or otherwise restored
to the Company, a trustee, receiver or any other person under any law
(including, without limitation, any bankruptcy law, state or federal law, common
law or equitable cause of action), then to the extent of any such restoration
the obligation or part thereof originally intended to be satisfied shall be
revived and continued in full force and effect as if such payment had not been
made or such enforcement or setoff had not occurred.
 
4.15 Independent Nature of Purchaser’ Obligations and Rights.  The obligations
of the Purchaser under any Transaction Document are several and not joint with
the obligations of any other purchaser of a Debenture, and no purchaser shall be
responsible in any way for the performance of the obligations of any other
purchaser under any Transaction Document.  Nothing contained herein or in any
Transaction Document, and no action taken by any Purchaser pursuant thereto,
shall be deemed to constitute the Purchaser as a partnership, an association, a
joint venture or any other kind of entity, or create a presumption that the
Purchaser are in any way acting in concert or as a group with respect to such
obligations or the transactions contemplated by the Transaction Documents.  The
Purchaser shall be entitled to independently protect and enforce its rights,
including without limitation, the rights arising out of this Agreement or out of
the other Transaction Documents, and it shall not be necessary for any other
Purchaser to be joined as an additional party in any proceeding for such
purpose.  The Purchaser has been represented by its own separate legal counsel
in their review and negotiation of the Transaction Documents.  For reasons of
administrative convenience only, Purchaser and its respective counsel have
chosen to communicate with the Company through FMC.
 
4.16 Liquidated Damages.  The Company’s obligations to pay any partial
liquidated damages or other amounts owing under the Transaction Documents is a
continuing obligation of the Company and shall not terminate until all unpaid
partial liquidated damages and other amounts have been paid notwithstanding the
fact that the instrument or security pursuant to which such partial liquidated
damages or other amounts are due and payable shall have been canceled.
 
4.17 Construction. The parties agree that each of them and/or their respective
counsel has reviewed and had an opportunity to revise the Transaction Documents
and, therefore, the normal rule of construction to the effect that any
ambiguities are to be resolved against the drafting party shall not be employed
in the interpretation of the Transaction Documents or any amendments hereto.
 
4.18 Security Agreements Funds Escrow Agreement and Shares Escrow
Agreement.  The parties acknowledge that the provisions of the Mexoro General
Security Agreement, the Sunburst General Security Agreement, the Funds Escrow
Agreement and the Shares Escrow Agreement in the forms attached hereto as
Exhibit B, Exhibit C and Exhibit D, respectively, are incorporated by reference
and made a part hereof, and that the Purchaser's signature hereto will operate
to be effective as such Purchaser's signature to the Security Agreements, the
Funds Escrow Agreement and the Shares Escrow Agreement.
 
(Signature Pages Follow)
 
 
2

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IN WITNESS WHEREOF, the parties hereto have caused this Securities Purchase
Agreement to be duly executed by their respective authorized signatories as of
the date first indicated above.
 

MEXORO MINERALS LTD.
 
 
Address for Notice:
By:__/s/ Francisco Quiroz________________
     Name: Fransisco Quiroz
     Title: President
 
 
General Retana 706
Col. San Felipe, Chihuahua, Chih.
Mexico, C.P. 32103
       

[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK
SIGNATURE PAGE FOR PURCHASER FOLLOWS]
 
3

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[PURCHASER SIGNATURE PAGES TO MEXORO MINERALS LTD. SECURITIES PURCHASE
AGREEMENT]

IN WITNESS WHEREOF, the undersigned have caused this Securities Purchase
Agreement to be duly executed by their respective authorized signatories as of
the date first indicated above.  EXECUTION OF THIS AGREEMENT BY ANY PURCHASER
SHALL BE DEEMED TO CONSTITUTE EXECUTION OF THE CONVERTIBLE DEBENTURE ANNEXED
HERETO AS EXHIBIT A, THE SECURITY AGREEMENT ANNEXED HERETO AS EXHIBIT B, THE
FUNDS ESCROW AGREEMENT ANNEXED HERETO AS EXHIBIT D AND THE SHARES ESCROW
AGREEMENT ANNEXED HERETO AS EXHIBIT F BY SUCH PURCHASER.
 
Name of Purchaser: ________________________________________________________
Signature of Authorized Signatory of Purchaser:
__________________________________
Name of Authorized Signatory:
____________________________________________________
Title of Authorized Signatory:
_____________________________________________________
Email Address of Purchaser:________________________________________________

Address for Notice of Purchaser:

Address for Delivery of Securities for Purchaser (if not same as above):

Subscription Amount:

EIN Number:  [PROVIDE THIS UNDER SEPARATE COVER]

[SIGNATURE PAGES CONTINUE]