ESCROW AGREEMENT

     THIS ESCROW  AGREEMENT  (this  "Agreement")  is made and entered into as of
June ___,  2002, by AZCO MINING INC., a Delaware  corporation  (the  "Company");
CORNELL CAPITAL PARTNERS,  LP, a Delaware limited  partnership (the "Investor");
BUTLER GONZALEZ LLP (the "Investor's Counsel"); and FIRST UNION NATIONAL BANK, a
national banking association, as Escrow Agent hereunder (the "Escrow Agent").


                                   BACKGROUND

     WHEREAS,  the Company and the Investor  have entered into an Equity Line of
Credit  Agreement (the "Equity Line of Credit  Agreement")  dated as of the date
hereof, pursuant to which the Investor will purchase the Company's Common Stock,
par value $0.002 per share (the "Common  Stock"),  at a price per share equal to
the  Purchase  Price,  as that  term is  defined  in the  Equity  Line of Credit
Agreement,  for an aggregate amount of up to Five Million Dollars  ($5,000,000).
The Equity  Line of Credit  Agreement  provides  that on each  Advance  Date the
Investor, as that term is defined in the Equity Line of Credit Agreement,  shall
deposit  the  Advance  pursuant to the  Advance  Notice in a  segregated  escrow
account to be held by Escrow Agent and the Company shall  deposit  shares of the
Company's Common Stock, which shall be purchased by the Investor as set forth in
the Equity Line of Credit Agreement,  with the Investor's  Counsel,  in order to
effectuate a disbursement  to the Company of the Advance by the Escrow Agent and
a  disbursement  to the Investor of the shares of the Company's  Common Stock by
Investor's  Counsel at a closing  to be held as set forth in the Equity  Line of
Credit Agreement (the "Closing").

     WHEREAS,  Escrow Agent has agreed to accept,  hold,  and disburse the funds
deposited with it in accordance with the terms of this Agreement.

     WHEREAS,  Investor's  Counsel has agreed to accept,  hold, and disburse the
shares of the  Company's  Common  Stock  which  have been  deposited  with it in
accordance with the terms of this Agreement.

         WHEREAS, in order to establish the escrow of funds and shares to effect
the provisions of the Equity Line of Credit Agreement, the parties hereto have
entered into this Agreement.

     NOW THEREFORE,  in consideration  of the foregoing,  it is hereby agreed as
follows:

     1. Definitions.  The following terms shall have the following meanings when
used herein:

          a. "Escrow  Funds"  shall mean the Advance  funds  deposited  with the
     Escrow Agent pursuant to this Agreement.

          b. "Joint Written  Direction" shall mean a written direction  executed
     by the Investor and the Company directing Escrow Agent to disburse all or a
     portion of the Escrow  Funds or to take or refrain  from  taking any action
     pursuant to this Agreement.

          c.  "Common  Stock  Joint  Written  Direction"  shall  mean a  written
     direction  executed by the  Investor and the Company  directing  Investor's
     Counsel to disburse all or a portion of the shares of the Company's  Common
     Stock or to refrain from taking any action pursuant to this Agreement.

     2. Appointment of and Acceptance by Escrow Agent and Investor's Counsel.

     a. The Investor  and the Company  hereby  appoint  Escrow Agent to serve as
Escrow Agent  hereunder.  Escrow Agent hereby accepts such appointment and, upon
receipt by wire transfer of the Escrow Funds in accordance with Section 3 below,
agrees to hold,  invest and disburse the Escrow  Funds in  accordance  with this
Agreement.

<PAGE>

     b. The Investor and the Company hereby appoint  Investor's Counsel to serve
as the  holder of the  shares  of the  Company's  Common  Stock  which  shall be
purchased by the Investor.  Investor's  Counsel hereby accepts such  appointment
and, upon receipt via D.W.A.C or the certificates  representing of the shares of
the Company's  Common Stock in accordance  with Section 3 below,  agrees to hold
and disburse the shares of the Company's  Common Stock in  accordance  with this
Agreement.

     3. Creation of Escrow Account/Common Stock Account.

a. On or prior to the date of this Agreement the Escrow Agent shall establish an
escrow account for the deposit of the Escrow Funds entitled as follows: Azco
Mining Inc./Cornell Capital Partners, LP The Investor will wire funds to the
account of the Escrow Agent as follows:

<TABLE>
<CAPTION>

<S>                         <C>
Bank:                       First Union National Bank of New Jersey
Routing #:                  031201467
Account #:                  2020000659170
Name on Account:            Butler Gonzalez LLP/First Union as Escrow Agent
Name on Sub-Account:        Azco Mining Inc./Cornell Capital Partners, LP Escrow
                            account
Reference Sub-Account #:    1776-02
Attn:                       Robert Mercado (732) 452-3005
                            Carmela Agugliaro (732) 452-3005
Note:                       Only wire transfers shall be accepted.

</TABLE>

     b. On or prior  to the  date of this  Agreement  Investor's  Counsel  shall
establish an account for the D.W.A.C. of the shares of Common Stock. The Company
will D.W.A.C.  shares of the Company's Common Stock to the account of Investor's
Counsel as follows:

<TABLE>
<CAPTION>

<S>                        <C>
Brokerage Firm:            Investec Ernst & Co.
Account #:                 400-07595
DTC #:                     0233
Name on Account:           Butler Gonzalez LLP Escrow Account

</TABLE>

     4.  Deposits  into the Escrow  Account.  The Investor  agrees that it shall
promptly  deliver all monies for the  payment of the Common  Stock to the Escrow
Agent for deposit in the Escrow Account.

     5. Disbursements from the Escrow Account.

     a. At such time as Escrow Agent has collected and deposited  instruments of
payment  in the total  amount of the  Advance  and the  Investor's  Counsel  has
received  such Common Stock via D.W.A.C from the Company  which are to be issued
to the  Investor  pursuant  to the Equity Line of Credit  Agreement,  Investor's
Counsel  shall  notify the  Company  and the  Investor.  The  Escrow  Agent will
continue to hold such funds until the Investor and Company execute and deliver a
Joint Written Direction  directing the Escrow Agent to disburse the Escrow Funds
pursuant to Joint  Written  Direction  at which time the Escrow Agent shall wire
the Escrow  Funds to the  Company.  In  disbursing  such funds,  Escrow Agent is
authorized to rely upon such Joint Written Direction from Company and may accept
any signatory  from the Company  listed on the signature  page to this Agreement
and any  signature  from the  Investor  that Escrow  Agent  already has on file.
Simultaneous with delivery of the executed Joint Written Direction to the Escrow
Agent the  Investor and Company  shall  execute and deliver a Common Stock Joint
Written Direction to Investor's Counsel directing  Investor's Counsel to release
via  D.W.A.C  to the  Investor  the shares of the  Company's  Common  Stock.  In
releasing such shares of Common Stock  Investor's  Counsel is authorized to rely
upon such Common Stock Joint Written  Direction  from Company and may accept any
signatory  from the Company  listed on the signature  page to this Agreement and
any signature from the Investor Investor's Counsel has on file.

<PAGE>

     In the event the Escrow  Agent does not  receive  the amount of the Advance
from the  Investor,  the Escrow Agent shall notify the Company and the Investor.
In the event  Investor's  Counsel does not receive the shares of Common Stock to
be purchased by the Investor Investor's Counsel shall notify the Company and the
Investor.

     In the event that the Escrow  Agent is  advised by the  Investor's  Counsel
that the Common Stock has not been received  from the Company,  in no event will
the Escrow  Funds be released to the Company  until such shares are  received by
the Investor's Counsel.  For purposes of this Agreement,  the term "Common Stock
certificates"  shall mean Common Stock  certificates to be purchased pursuant to
the respective Advance Notice pursuant to the Equity Line of Credit Agreement.

     6. Collection  Procedure.  The Escrow Agent is hereby authorized to forward
each wire for  collection  and,  upon  collection  of the  proceeds of each wire
deposit the collected proceeds in the Escrow Account.

     Any wires  returned  unpaid to the Escrow  Agent  shall be  returned to the
Investor.  In such cases,  the Escrow Agent will promptly  notify the Company of
such return.

     7. Suspension of Performance: Disbursement Into Court.

     a. Escrow Agent. If at any time,  there shall exist any dispute between the
Company and the Investor with respect to holding or  disposition  of any portion
of the Escrow Funds or any other obligations of Escrow Agent hereunder, or if at
any  time  Escrow  Agent  is  unable  to  determine,   to  Escrow  Agent's  sole
satisfaction,  the proper  disposition  of any  portion  of the Escrow  Funds or
Escrow Agent's proper actions with respect to its obligations  hereunder,  or if
the parties have not within  thirty (30) days of the  furnishing by Escrow Agent
of a notice of resignation  pursuant to Section 9 hereof,  appointed a successor
Escrow Agent to act  hereunder,  then Escrow Agent may, in its sole  discretion,
take either or both of the following actions:

          i.  Suspend  the  performance  of any of  its  obligations  (including
     without   limitation  any  disbursement   obligations)  under  this  Escrow
     Agreement  until such dispute or uncertainty  shall be resolved to the sole
     satisfaction  of Escrow  Agent or until a successor  Escrow  Agent shall be
     appointed  (as the case may  be);  provided  however,  Escrow  Agent  shall
     continue to invest the Escrow  Funds in  accordance  with Section 8 hereof;
     and/or

          ii.  petition  (by  means  of an  interpleader  action  or  any  other
     appropriate  method)  any  court of  competent  jurisdiction  in any  venue
     convenient to Escrow Agent, for  instructions  with respect to such dispute
     or uncertainty, and to the extent required by law, pay into such court, for
     holding and disposition in accordance with the  instructions of such court,
     all funds held by it in the Escrow  Funds,  after  deduction and payment to
     Escrow Agent of all fees and expenses (including court costs and attorneys'
     fees)  payable to,  incurred by, or expected to be incurred by Escrow Agent
     in connection with performance of its duties and the exercise of its rights
     hereunder.

          iii.  Escrow  Agent  shall  have  no  liability  to the  Company,  the
     Investor,  or any person with respect to any such suspension of performance
     or disbursement into court, specifically including any liability or claimed
     liability  that may arise,  or be alleged  to have  arisen,  out of or as a
     result of any delay in the  disbursement  of funds held in the Escrow Funds
     or any delay in with respect to any other  action  required or requested of
     Escrow Agent.

<PAGE>

     b.  Investor's  Counsel.  If at any time,  there  shall  exist any  dispute
between the Company and the Investor with respect to holding or  disposition  of
any portion of the shares of Common Stock or any other obligations of Investor's
Counsel hereunder,  or if at any time Investor's Counsel is unable to determine,
to Investor's Counsel's sole satisfaction, the proper disposition of any portion
of the  shares of Common  Stock or  Investor's  Counsel's  proper  actions  with
respect to its obligations  hereunder,  then Investor's Counsel may, in its sole
discretion, take either or both of the following actions:

          i.  suspend  the  performance  of any of  its  obligations  (including
     without   limitation  any  disbursement   obligations)  under  this  Escrow
     Agreement  until such dispute or uncertainty  shall be resolved to the sole
     satisfaction of Investor's  Counsel or until a successor shall be appointed
     (as the case may be); and/or

          ii.  petition  (by  means  of an  interpleader  action  or  any  other
     appropriate  method)  any  court of  competent  jurisdiction  in any  venue
     convenient to Investor's  Counsel,  for  instructions  with respect to such
     dispute or  uncertainty,  and to the extent  required by law, pay into such
     court,  for holding and disposition in accordance with the  instructions of
     such  court,  all shares of the  Company's  Common  Stock funds held by it,
     after deduction and payment to Investor's  Counsel of all fees and expenses
     (including  court costs and  attorneys'  fees) payable to,  incurred by, or
     expected  to  be  incurred  by  Investor's   Counsel  in  connection   with
     performance of its duties and the exercise of its rights hereunder.

          iii.  Investor's  Counsel shall have no liability to the Company,  the
     Investor,  or any person with respect to any such suspension of performance
     or disbursement into court, specifically including any liability or claimed
     liability  that may arise,  or be alleged  to have  arisen,  out of or as a
     result of any delay in the release of shares of the Company's  Common Stock
     or any delay in with respect to any other  action  required or requested of
     Investor's Counsel.

     8.  Investment of Escrow  Funds.  The Escrow Agent shall deposit the Escrow
Funds in a non-interest bearing money market account.

     If Escrow Agent has not received a Joint Written Direction at any time that
an investment  decision must be made, Escrow Agent shall invest the Escrow Fund,
or such  portion  thereof,  as to  which  no Joint  Written  Direction  has been
received,  in investments  described above. The foregoing  investments  shall be
made by the Escrow Agent.  Notwithstanding  anything to the contrary  contained,
Escrow Agent may,  without  notice to the parties,  sell or liquidate any of the
foregoing  investments at any time if the proceeds  thereof are required for any
release of funds permitted or required hereunder,  and Escrow Agent shall not be
liable or responsible for any loss, cost or penalty resulting from any such sale
or liquidation.

     9.  Resignation  and Removal of Escrow Agent.  Escrow Agent may resign from
the performance of its duties  hereunder at any time by giving thirty (30) days'
prior written notice to the parties or may be removed, with or without cause, by
the parties,  acting jointly,  by furnishing a Joint Written Direction to Escrow
Agent,  at any time by the  giving of ten (10)  days'  prior  written  notice to
Escrow Agent as provided  herein below.  Upon any such notice of  resignation or
removal,  the  representatives  of the  Investor and the Company  identified  in
Sections 15a.(iv) and 15b.(iv),  below, jointly shall appoint a successor Escrow
Agent  hereunder,  which  shall be a  commercial  bank,  trust  company or other
financial  institution  with  a  combined  capital  and  surplus  in  excess  of
$10,000,000.00.  Upon the  acceptance  in writing of any  appointment  of Escrow
Agent hereunder by a successor  Escrow Agent,  such successor Escrow Agent shall
thereupon succeed to and become vested with all the rights,  powers,  privileges
and duties of the retiring Escrow Agent,  and the retiring Escrow Agent shall be
discharged  from its duties and  obligations  under this Escrow  Agreement,  but
shall not be  discharged  from any  liability  for actions taken as Escrow Agent
hereunder  prior  to  such   succession.   After  any  retiring  Escrow  Agent's
resignation or removal,  the provisions of this Escrow  Agreement shall inure to
its  benefit as to any  actions  taken or omitted to be taken by it while it was
Escrow  Agent under this  Escrow  Agreement.  The  retiring  Escrow  Agent shall
transmit all records pertaining to the Escrow Funds and shall pay all funds held
by it in the Escrow Funds to the successor Escrow Agent,  after making copies of
such records as the retiring  Escrow Agent deems  advisable and after  deduction
and payment to the retiring  Escrow  Agent of all fees and  expenses  (including
court costs and  attorneys'  fees)  payable to,  incurred  by, or expected to be
incurred by the retiring  Escrow Agent in connection with the performance of its
duties and the exercise of its rights hereunder.

<PAGE>

     10. Liability of Escrow Agent.

     a. Escrow Agent shall have no liability or  obligation  with respect to the
Escrow Funds except for Escrow Agent's willful  misconduct or gross  negligence.
Escrow Agent's sole responsibility shall be for the safekeeping, investment, and
disbursement of the Escrow Funds in accordance with the terms of this Agreement.
Escrow  Agent  shall  have no  implied  duties or  obligations  and shall not be
charged with knowledge or notice or any fact or  circumstance  not  specifically
set forth herein. Escrow Agent may rely upon any instrument,  not only as to its
due execution, validity and effectiveness, but also as to the truth and accuracy
of any  information  contained  therein,  which Escrow Agent shall in good faith
believe to be genuine, to have been signed or presented by the person or parties
purporting to sign the same and conform to the provisions of this Agreement.  In
no event shall Escrow Agent be liable for  incidental,  indirect,  special,  and
consequential or punitive  damages.  Escrow Agent shall not be obligated to take
any legal action or commence any proceeding in connection with the Escrow Funds,
any account in which Escrow Funds are  deposited,  this  Agreement or the Equity
Line of Credit  Agreement,  or to appear in,  prosecute or defend any such legal
action or proceeding.  Escrow Agent may consult legal counsel  selected by it in
any event of any dispute or question as to construction of any of the provisions
hereof or of any other  agreement  or its duties  hereunder,  or relating to any
dispute  involving any party  hereto,  and shall incur no liability and shall be
fully indemnified from any liability whatsoever in acting in accordance with the
opinion or  instructions of such counsel.  The Company and the Investor  jointly
and severally shall promptly pay, upon demand,  the reasonable fees and expenses
of any such counsel.

     b. The Escrow Agent is hereby authorized, in its sole discretion, to comply
with orders  issued or process  entered by any court with  respect to the Escrow
Funds, without determination by the Escrow Agent of such court's jurisdiction in
the  matter.  If any  portion  of the  Escrow  Funds  is at any  time  attached,
garnished  or  levied  upon  under  any  court  order,  or in case the  payment,
assignment,  transfer,  conveyance  or  delivery of any such  property  shall be
stayed or  enjoined  by any court  order,  or in any case any order  judgment or
decree shall be made or entered by any court affecting such property or any part
thereof, then and in any such event, the Escrow Agent is authorized, in its sole
discretion, to rely upon and comply with any such order, writ judgment or decree
which it is advised by legal counsel  selected by it,  binding upon it,  without
the need for appeal or other action;  and if the Escrow Agent  complies with any
such  order,  writ,  judgment  or  decree,  it shall not be liable to any of the
parties  hereto  or to any other  person or entity by reason of such  compliance
even though such order,  writ judgment or decree may be  subsequently  reversed,
modified, annulled, set aside or vacated.

     11. Liability of Investor's Counsel.

     a.  Notwithstanding  any liability  attributable  to Investor's  Counsel as
counsel  to  the  Investor,  Investor's  Counsel  shall  have  no  liability  or
obligation  with respect to the shares of the Company's  Common Stock except for
Investor's   Counsel's  willful  misconduct  or  gross  negligence.   Investor's
Counsel's sole  responsibility  shall be for the  safekeeping and release of the
shares  of the  Company's  Common  Stock in  accordance  with the  terms of this
Agreement.  Investor's  Counsel shall have no implied duties or obligations  and
shall not be charged with  knowledge or notice or any fact or  circumstance  not
specifically set forth herein.  Investor's Counsel may rely upon any instrument,
not only as to its due execution, validity and effectiveness, but also as to the
truth and  accuracy  of any  information  contained  therein,  which  Investor's
Counsel  shall in good  faith  believe  to be  genuine,  to have been  signed or
presented  by the person or parties  purporting  to sign the same and conform to
the provisions of this Agreement. In no event shall Investor's Counsel be liable
for  incidental,  indirect,  special,  and  consequential  or punitive  damages.
Investor's  Counsel  shall not be obligated to take any legal action or commence
any proceeding in connection with the shares of the Company's  Common Stock, any
account in which shares of Common Stock are deposited and this Agreement,  or to
appear in,  prosecute or defend any such legal action or proceeding.  Investor's
Counsel may consult legal counsel  selected by it in any event of any dispute or
question  as to  construction  of any of the  provisions  hereof or of any other
agreement  or its duties  hereunder,  or relating to any dispute  involving  any
party hereto,  and shall incur no liability and shall be fully  indemnified from
any  liability   whatsoever  in  acting  in  accordance   with  the  opinion  or
instructions of such counsel. The Company and the Investor jointly and severally
shall promptly pay, upon demand,  the  reasonable  fees and expenses of any such
counsel.

<PAGE>

     b. Investor's  Counsel is hereby  authorized,  in its sole  discretion,  to
comply with orders  issued or process  entered by any court with  respect to the
shares of the Company's Common Stock,  without  determination by Butler Gonzalez
of such court's  jurisdiction in the matter. If any portion of the shares of the
Company's Common Stock are at any time attached,  garnished or levied upon under
any court order,  or in case the payment,  assignment,  transfer,  conveyance or
delivery of any such property shall be stayed or enjoined by any court order, or
in any case any order  judgment or decree  shall be made or entered by any court
affecting  such  property or any part thereof,  then and in any such event,  the
Investor's  Counsel  is  authorized,  in its sole  discretion,  to rely upon and
comply with any such order, writ judgment or decree which it is advised by legal
counsel  selected by it,  binding upon it,  without the need for appeal or other
action; and if Investor's  Counsel complies with any such order, writ,  judgment
or decree,  it shall not be liable to any of the parties  hereto or to any other
person or entity by reason of such  compliance  even  though  such  order,  writ
judgment or decree may be subsequently reversed,  modified,  annulled, set aside
or vacated.

     12.  Indemnification  of Escrow Agent. From and at all times after the date
of this  Agreement,  the parties  jointly and severally,  shall,  to the fullest
extent  permitted by law and to the extent provided  herein,  indemnify and hold
harmless Escrow Agent and each director, officer, employee,  attorney, agent and
affiliate of Escrow Agent (collectively,  the "Indemnified Parties") against any
and all actions,  claims (whether or not valid), losses,  damages,  liabilities,
costs  and  expenses  of  any  kind  or  nature  whatsoever  (including  without
limitation  reasonable  attorney's  fees,  costs and  expenses)  incurred  by or
asserted against any of the Indemnified  Parties from and after the date hereof,
whether direct, indirect or consequential,  as a result of or arising from or in
any way relating to any claim,  demand,  suit, action, or proceeding  (including
any inquiry or  investigation) by any person,  including without  limitation the
parties to this Agreement,  whether  threatened or initiated,  asserting a claim
for any legal or  equitable  remedy  against  any  person  under any  statute or
regulation, including, but not limited to, any federal or state securities laws,
or under any common law or  equitable  cause or  otherwise,  arising  from or in
connection with the negotiation,  preparation, execution, performance or failure
of performance of this Agreement or any transaction contemplated herein, whether
or not any such  Indemnified  Party is a party to any such action or proceeding,
suit or the target of any such inquiry or investigation; provided, however, that
no  Indemnified  Party  shall  have the right to be  indemnified  hereunder  for
liability finally determined by a court of competent jurisdiction, subject to no
further  appeal,  to have resulted  solely from the gross  negligence or willful
misconduct  of such  Indemnified  Party.  If any such  action or claim  shall be
brought or asserted against any Indemnified  Party, such Indemnified Party shall
promptly notify the Company and the Investor  hereunder in writing,  and the and
the Company  shall  assume the defense  thereof,  including  the  employment  of
counsel and the payment of all expenses.  Such  Indemnified  Party shall, in its
sole discretion,  have the right to employ separate counsel (who may be selected
by such  Indemnified  Party in its sole  discretion)  in any such  action and to
participate and to participate in the defense thereof, and the fees and expenses
of such  counsel  shall  be paid by such  Indemnified  Party,  except  that  the
Investor  and/or the  Company  shall be required to pay such fees and expense if
(a) the Investor or the Company agree to pay such fees and expenses,  or (b) the
Investor  and/or the Company  shall fail to assume the defense of such action or
proceeding or shall fail, in the sole discretion of such  Indemnified  Party, to
employ counsel  reasonably  satisfactory  to the  Indemnified  Party in any such
action or proceeding,  (c) the Investor and the Company are the plaintiff in any
such  action or  proceeding  or (d) the named or  potential  parties to any such
action or proceeding  (including any potentially impleaded parties) include both
Indemnified  Party the Company and/or the Investor and  Indemnified  Party shall
have been  advised  by  counsel  that  there may be one or more  legal  defenses
available to it which are different from or additional to those available to the
Company or the  Investor.  The  Investor  and the  Company  shall be jointly and
severally  liable to pay fees and expenses of counsel  pursuant to the preceding
sentence, except that any obligation to pay under clause (a) shall apply only to
the party so agreeing.  All such fees and expenses payable by the Company and/or
the Investor pursuant to the foregoing  sentence shall be paid from time to time
as incurred,  both in advance of and after the final  disposition of such action
or claim.  The  obligations  of the parties under this section shall survive any
termination of this  Agreement,  and  resignation or removal of the Escrow Agent
shall be independent of any obligation of Escrow Agent.

<PAGE>

     13.  Indemnification of Investor's Counsel. From and at all times after the
date of this Agreement, the parties jointly and severally, shall, to the fullest
extent  permitted by law and to the extent provided  herein,  indemnify and hold
harmless  Investor's  Counsel and each  partner,  director,  officer,  employee,
attorney,   agent  and  affiliate  of  Investor's  Counsel  (collectively,   the
"Indemnified  Parties")  against  any and all  actions,  claims  (whether or not
valid), losses, damages,  liabilities,  costs and expenses of any kind or nature
whatsoever  (including without limitation  reasonable attorney's fees, costs and
expenses)  incurred by or asserted  against any of the Indemnified  Parties from
and after the date  hereof,  whether  direct,  indirect or  consequential,  as a
result of or arising  from or in any way  relating to any claim,  demand,  suit,
action,  or proceeding  (including any inquiry or  investigation) by any person,
including without  limitation the parties to this Agreement,  whether threatened
or initiated,  asserting a claim for any legal or equitable  remedy  against any
person  under any  statute or  regulation,  including,  but not  limited to, any
federal or state  securities laws, or under any common law or equitable cause or
otherwise,  arising from or in  connection  with the  negotiation,  preparation,
execution,  performance  or  failure of  performance  of this  Agreement  or any
transaction  contemplated herein, whether or not any such Indemnified Party is a
party to any such action or  proceeding,  suit or the target of any such inquiry
or investigation;  provided,  however,  that no Indemnified Party shall have the
right to be indemnified hereunder for liability finally determined by a court of
competent  jurisdiction,  subject to no further appeal,  to have resulted solely
from the gross negligence or willful  misconduct of such  Indemnified  Party. If
any such action or claim shall be brought or  asserted  against any  Indemnified
Party, such Indemnified Party shall promptly notify the Company and the Investor
hereunder in writing,  and the Investor and the Company shall assume the defense
thereof,  including  the  employment of counsel and the payment of all expenses.
Such Indemnified  Party shall, in its sole discretion,  have the right to employ
separate  counsel  (who may be  selected by such  Indemnified  Party in its sole
discretion)  in any such action and to  participate  and to  participate  in the
defense thereof, and the fees and expenses of such counsel shall be paid by such
Indemnified Party, except that the Investor and/or the Company shall be required
to pay such fees and expense if (a) the  Investor  or the  Company  agree to pay
such fees and  expenses,  or (b) the Investor  and/or the Company  shall fail to
assume the  defense of such  action or  proceeding  or shall  fail,  in the sole
discretion of such Indemnified Party, to employ counsel reasonably  satisfactory
to the Indemnified Party in any such action or proceeding,  (c) the Investor and
the Company are the  plaintiff in any such action or proceeding or (d) the named
or potential parties to any such action or proceeding (including any potentially
impleaded  parties)  include  both  Indemnified  Party the  Company  and/or  the
Investor and the Indemnified Party shall have been advised by counsel that there
may be one or more legal  defenses  available to it which are different  from or
additional to those  available to the Company or the Investor.  The Investor and
the Company  shall be jointly and  severally  liable to pay fees and expenses of
counsel  pursuant to the preceding  sentence,  except that any obligation to pay
under  clause (a) shall apply only to the party so  agreeing.  All such fees and
expenses  payable by the Company  and/or the Investor  pursuant to the foregoing
sentence  shall be paid from time to time as  incurred,  both in  advance of and
after the final  disposition  of such action or claim.  The  obligations  of the
parties under this section shall survive any termination of this Agreement.

<PAGE>

     14. Expenses of Escrow Agent. Except as set forth in Section 12 the Company
shall reimburse Escrow Agent for all of its reasonable  out-of-pocket  expenses,
including attorneys' fees, travel expenses, telephone and facsimile transmission
costs, postage (including express mail and overnight delivery charges),  copying
charges and the like. All of the compensation and reimbursement  obligations set
forth in this  Section  shall be payable by the  Company,  upon demand by Escrow
Agent.  The  obligations  of the Company  under this Section  shall  survive any
termination of this Agreement and the resignation or removal of Escrow Agent.

     15. Warranties.

     a. The Investor makes the following  representations  and warranties to the
Escrow Agent and Investor's Counsel:

          i. The  Investor  has full power and  authority to execute and deliver
     this Agreement and to perform its obligations hereunder.

          ii. This  Agreement has been duly approved by all necessary  action of
     the Investor,  including any necessary  approval of the limited  partner of
     the  Investor,  has  been  executed  by  duly  authorized  officers  of the
     Investor's general partner, enforceable in accordance with its terms.

          iii. The execution,  delivery, and performance of the Investor of this
     Agreement  will not violate,  conflict  with,  or cause a default under the
     agreement of limited  partnership  of the Investor,  any  applicable law or
     regulation, any court order or administrative ruling or degree to which the
     Investor is a party or any of its  property is subject,  or any  agreement,
     contract, indenture, or other binding arrangement.

          iv.   Mark  A.  Angelo  has  been  duly   appointed   to  act  as  the
     representative  of Investor  hereunder  and has full power and authority to
     execute,  deliver,  and perform this Agreement,  to execute and deliver any
     Joint Written Direction,  to amend,  modify, or waive any provision of this
     Agreement,  and to  take  any  and  all  other  actions  as the  Investor's
     representative  under  this  Agreement,  all  without  further  consent  or
     direction form, or notice to, the Investor or any other party.

          v. No party other than the parties  hereto  have,  or shall have,  any
     lien,  claim or security  interest in the Escrow Funds or any part thereof.
     No financing  statement under the Uniform Commercial Code is on file in any
     jurisdiction  claiming  a  security  interest  in  or  describing  (whether
     specifically or generally) the Escrow Funds or any part thereof.

          vi.  All  of  the  representations  and  warranties  of  the  Investor
     contained  herein are true and  complete  as of the date hereof and will be
     true and complete at the time of any disbursement from the Escrow Funds.

     b. The Company makes the following representations and warranties to Escrow
Agent, the Investor and Investor's Counsel:

          i. The Company is a corporation duly organized,  validly existing, and
     in good  standing  under  the laws of the State of  Delaware,  and has full
     power and  authority to execute and deliver this  Agreement  and to perform
     its obligations hereunder.

<PAGE>

          ii. This  Agreement has been duly approved by all necessary  corporate
     action of the Company,  including any necessary shareholder  approval,  has
     been executed by duly  authorized  officers of the Company,  enforceable in
     accordance with its terms.

          iii. The execution,  delivery,  and performance by the Company of this
     Escrow  Agreement is in accordance with the Equity Line of Credit Agreement
     and  will  not  violate,  conflict  with,  or  cause a  default  under  the
     certificate of incorporation  or bylaws of the Company,  any applicable law
     or regulation,  any court order or administrative ruling or decree to which
     the Company is a party or any of its property is subject, or any agreement,
     contract, indenture, or other binding arrangement.

          iv. Ryan Modesto has been duly appointed to act as the  representative
     of the  Company  hereunder  and has full power and  authority  to  execute,
     deliver,  and  perform  this  Agreement,  to execute  and deliver any Joint
     Written  Direction,  to  amend,  modify  or  waive  any  provision  of this
     Agreement  and to take all other  actions as the  Company's  Representative
     under this  Agreement,  all without  further  consent or direction from, or
     notice to, the Company or any other party.

          v. No party other than the parties hereto shall have, any lien,  claim
     or security interest in the Escrow Funds or any part thereof.  No financing
     statement under the Uniform  Commercial Code is on file in any jurisdiction
     claiming a security  interest in or  describing  (whether  specifically  or
     generally) the Escrow Funds or any part thereof.

          vi. All of the representations and warranties of the Company contained
     herein  are true and  complete  as of the date  hereof and will be true and
     complete at the time of any disbursement from the Escrow Funds.

     16. Consent to  Jurisdiction  and Venue. In the event that any party hereto
commences  a  lawsuit  or other  proceeding  relating  to or  arising  from this
Agreement,  the parties  hereto agree that the United States  District Court for
the District of New Jersey shall have the sole and exclusive  jurisdiction  over
any  such   proceeding.   If  all  such  courts  lack  federal   subject  matter
jurisdiction,  the parties agree that the Superior Court Division of New Jersey,
Chancery  Division of Essex County shall have sole and  exclusive  jurisdiction.
Any of these  courts  shall be proper  venue for any such  lawsuit  or  judicial
proceeding and the parties hereto waive any objection to such venue. The parties
hereto consent to and agree to submit to the  jurisdiction  of any of the courts
specified  herein  and agree to accept the  service of process to vest  personal
jurisdiction over them in any of these courts.

<PAGE>

     17.  Notice.  All notices and other  communications  hereunder  shall be in
writing and shall be deemed to have been validly served, given or delivered five
(5) days after deposit in the United States mails, by certified mail with return
receipt requested and postage prepaid,  when delivered  personally,  one (1) day
delivered  to  any  overnight   courier,   or  when   transmitted  by  facsimile
transmission and addressed to the party to be notified as follows:

<TABLE>
<CAPTION>

<S>                                         <C>
If to Investor, to:                         Cornell Capital Partners, LP
                                            101 Hudson Street - Suite 3606
                                            Jersey City, New Jersey 07302
                                            Attention: Mark Angelo
                                            Facsimile:      (201) 985-8266

With copy to:                               Butler Gonzalez LLP
                                            1000 Stuyvesant Avenue - Suite 6
                                            Union, New Jersey 07083
                                            Attention:      David Gonzalez, Esq.
                                            Facsimile:      (908) 810-0973

If to Company, to:                          Azco Mining Inc.
                                            7239 N. El Mirage Road
                                            Glendale, AZ 85307
                                            Attention:    Ryan Modesto,
                                                          Vice President-Finance
                                            Facsimile:    (623) 935 0781

With copy to:                               Kirkpatrick & Lockhart LLP
                                            201 South Biscayne Boulevard -
                                            Suite 2000
                                            Miami, Florida  33131-2399
                                            Attention:      Clayton Parker, Esq.
                                            Facsimile:      (305) 358-7095

If to the Escrow Agent, to:                 First Union National Bank,
                                            407 Main Street
                                            Metuchen, New Jersey 08840
                                            Attention: Robert Mercado
                                                       Carmela Agugliaro
                                            Facsimile:        (732) 548-5973

</TABLE>

     Or to such other  address as each  party may  designate  for itself by like
notice.

     18. Amendments or Waiver. This Agreement may be changed, waived, discharged
or terminated  only by a writing  signed by the parties of the Escrow Agent.  No
delay or omission by any party in exercising any right with respect hereto shall
operate as waiver.  A waiver on any one occasion shall not be construed as a bar
to, or waiver of, any right or remedy on any future occasion.

     19.  Severability.  To the  extent  any  provision  of  this  Agreement  is
prohibited  by  or  invalid  under  applicable  law,  such  provision  shall  be
ineffective  to  the  extent  of  such  prohibition,   or  invalidity,   without
invalidating the remainder of such provision or the remaining provisions of this
Agreement.

     20.  Governing  Law. This Agreement  shall be construed and  interpreted in
accordance  with the  internal  laws of the State of New Jersey  without  giving
effect to the conflict of laws principles thereof.

     21. Entire  Agreement.  This  Agreement  constitutes  the entire  Agreement
between the parties relating to the holding, investment, and disbursement of the
Escrow Funds and sets forth in their entirety the  obligations and duties of the
Escrow Agent with respect to the Escrow Funds.

     22. Binding  Effect.  All of the terms of this  Agreement,  as amended from
time to time,  shall be binding upon, inure to the benefit of and be enforceable
by the respective heirs, successors and assigns of the Investor, the Company, or
the Escrow Agent.

     23.  Execution  of  Counterparts.  This  Agreement  and any  Joint  Written
Direction  may be  executed  in  counter  parts,  which when so  executed  shall
constitute one and same agreement or direction.

     24. Termination. Upon the first to occur of the disbursement of all amounts
in the Escrow Funds pursuant to Joint Written  Directions or the disbursement of
all amounts in the Escrow  Funds into court  pursuant to Section 7 hereof,  this
Agreement shall  terminate and Escrow Agent shall have no further  obligation or
liability whatsoever with respect to this Agreement or the Escrow Funds.

<PAGE>

     IN WITNESS  WHEREOF the parties have hereunto set their hands and seals the
day and year above set forth.

                                                AZCO MINING INC.

                                                By:
                                                Name:    Ryan Modesto
                                                Title:   Vice President-Finance


                                                FIRST UNION NATIONAL BANK

                                                By:
                                                Name:    Robert Mercado
                                                Title:   As the Escrow Agent


                                                CORNELL CAPITAL PARTNERS, LP

                                                By:      Yorkville Advisors, LLC
                                                Its:     General Partner

                                                By:
                                                Name:    Mark A. Angelo
                                                Title:   Portfolio Manager


                                                BUTLER GONZALEZ LLP

                                                By:
                                                Name:    David Gonzalez, Esq.
                                                Title:   Partner