UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549  Form 10-QSB/A   X QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarter ended May 31, 2006  _ TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from ____ to _____   MEXORO MINERALS LTD. (Formerly Sunburst Acquisitions IV, Inc. (Name of small business in its charter)  Colorado0-2356184-1431797(State or other jurisdiction of incorporation)(Commission File Number)(IRS Employer Identification Number)  609 Granville Street, Suite 880
Vancouver, BCV7Y 1G5(Address of principal executive offices)(Zip Code)  Registrants telephone number, including area code:  (800) 661-7830  Check whether the issuer (1) filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act during the past 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes X   No ____  Applicable only to issuers involved in bankruptcy proceedings during the past five years:  Check whether the issuer has filed all documents and reports required to be filed by Section 12, 13 or 15(d) of the Exchange Act after the distribution of securities under a plan confirmed by a court. Yes ____ No ____  Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).  Yes ____ No X  Applicable only to corporate issuers: State the number of shares outstanding of each of the issuer's classes of common equity, as of the latest practicable date: 21,036,102 at July 13, 2006.  Transitional Small Business Disclosure Format (Check one):  Yes __ No X  - 6 -     EXPLANATORY NOTE  We are filing this Form 10-QSB/A for the period ended May 31, 2006, to reflect changes in our controls and procedures disclosure.  Any items included in the original report on Form 10-QSB for the period ended May 31, 2006, that are not included herein, are not amended and remain in effect as of the date of the original filing thereof.  Additionally, this Form 10-QSB/A does not purport to provide a general update or discussion of any other developments subsequent to the original filing.  The filing of this Form 10-QSB/A shall not be deemed to be an admission that the original filing, when made, included any untrue statement of material fact or omitted to state a material fact necessary to make a statement contained therein not misleading.      MEXORO MINERALS LTD. (Formerly Sunburst Acquisition IV, Inc.) (An Exploration Stage Company)  Consolidated Financial Statements May 31, 2006 (Unaudited) (U.S. Dollars)          INDEX Page  Consolidated Financial Statements  Consolidated Balance Sheets 3  Consolidated Statements of Operations and Accumulated Deficit 4  Consolidated Statements of Cash Flows 5  Notes to Consolidated Financial Statements 6 - 17    - 7 -     MEXORO MINERALS LTD. (Formerly Sunburst Acquisitions IV, Inc.) (An Exploration Stage Company) Consolidated Balance Sheets (U.S. Dollars)  May 31,February 28,20062006(Unaudited)(Audited)AssetsCurrentCash and cash equivalents$2,074,857$479,530Accounts receivable62,72610,069Prepaid expenses10,00048,2692,147,583537,868Equipment (note 4)2,725880Total Assets$2,150,308$538,748LiabilitiesCurrentAccounts payable and accrued liabilities$86,777$79,124Promissory notes (note 6)-412,80086,777491,924Convertible Debentures (note 7)2,917,500652,000Total Liabilities3,004,2771,143,924Stockholders DeficiencyCapital StockPreferred stockAuthorized: 20,000,000 shares without par value (note 8)Issued: nil--Common stockAuthorized: 200,000,000 shares without par valueIssued: 15,201,102 (2006  12,799,902) (note 9)16,371,77715,583,977Additional paid-in capital18,347,84616,082,346Stock subscriptions-170,000Accumulated deficit from prior operations(2,003,427)(2,003,427)Accumulated deficit during the exploration stage(33,553,799)(30,439,123)Other comprehensive income(16,366)1,051Total Stockholders Deficiency(853,969)(605,176)Total Liabilities and Stockholders Deficiency$2,150,308$538,748  Going concern (note 3) Commitments (note 5) Subsequent events (note 13) The Accompanying Notes are an Integral Part of These Financial Statements.  - 8 -       MEXORO MINERALS LTD. (Formerly Sunburst Acquisitions IV, Inc.) (An Exploration Stage Company) Consolidated Statements of Operations and Accumulated Deficit (Unaudited) (U.S. Dollars)  Period fromInception ofExploration StageThree Months Ended(March 1, 2004)May 31,May 31,To May 31,200620052006ExpensesGeneral and administrative$570,288$13,052$9,957,035Stock-based compensation--4,232,955Mineral exploration252,261-252,261Acquisition of resource properties--15,306,422Operating Loss(822,549)(13,052)(29,748,673)Other Income (Expenses)Interest expense(2,305,441)(1,290)(3,951,625)Interest income6,055-6,055Gain on settlement of debt (notes 6 and 7)7,259-140,444Net Loss(3,114,676)(14,342)(33,553,799)Accumulated Deficit, Beginning(30,439,123)(13,912,488)-Accumulated Deficit, Ending$(33,553,799)$(13,926,830)$(33,553,799)Other Comprehensive IncomeForeign exchange gain (loss) on translation(32,612)5,975(16,754)Total Comprehensive Loss$(3,147,288)$(8,367)$(33,570,553)Total Loss Per Share  basic and diluted$ (0.22)$ (0.01)Weighted Average Number of Shares ofCommon Stock  basic and diluted14,159,8721,737,902   - 9 -     MEXORO MINERALS LTD. (Formerly Sunburst Acquisitions IV, Inc.) (An Exploration Stage Company) Consolidated Statements of Cash Flows (Unaudited) (U.S. Dollars)  Period fromInception ofExploration StageThree Months Ended(March 1, 2004)May 31,May 31,to May 31,200620052006Operating ActivitiesNet loss$(3,114,676)$(14,342)$(33,553,799)Adjustments to reconcile net lossto net cash flowsWrite off of note receivable--57,500Acquisition of resource properties for
stock--13,065,000Amortization117-117Discount on convertible debenture--175,000Effect of foreign currency translation on cash(17,417)96(3,218)Stock-based compensation--14,535,955Beneficial conversion feature2,265,500-3,717,500Prepaid expense38,2694,492(3,520)Accounts receivable(52,657)-(54,520)Customer deposits--(44,809)Accounts payable and accrued liabilities7,65341864,584Cash Used in Operating Activities(873,211)(10,172)(2,044,210)Investing ActivityPurchase of property and equipment(1,962)-(2,842)Cash Used in Investing Activity(1,962)-(2,842)Financing ActivitiesProceeds from notes payable--562,800Proceeds from convertible debentures2,265,500-3,717,500Proceeds from exercise of options--78,000Repayment of notes payable-(15,000)(591,300)Repayment of convertible debentures--(705,000)Stock subscriptions(170,000)--Issuance of common stock375,000-1,059,909Cash Provided by (Used in) FinancingActivities2,470,500(15,000)4,121,909Inflow of Cash and Cash Equivalents1,595,327(25,172)2,074,857Cash and Cash Equivalents, Beginning479,53035,122-Cash and Cash Equivalents, Ending$2,074,857$9,950$2,074,857Supplemental Cash Flow InformationInterest paid$39,941$1,290$146,625Common stock issued on conversion of debt$-$-$300,000Common stock issued on settlement of notes payable$412,800$-$412,800Shares issued for services$-$-$100,000   - 10 -     MEXORO MINERALS LTD. (Formerly Sunburst Acquisitions IV, Inc.) (An Exploration Stage Company) Notes to Consolidated Financial Statements Three Months Ended May 31, 2006 (Unaudited) (U.S. Dollars)  1. BASIS OF PRESENTATION  Mexoro Minerals Ltd. (formerly Sunburst Acquisitions IV, Inc.) ("Mexoro" or the Company) was incorporated in the state of Colorado on August 27, 1997 and on February 15, 2006 its name was changed to Mexoro Minerals Ltd.  The Company was formed to seek out and acquire business opportunities.  Between 1997 and 2003, the Company engaged in two business acquisitions and one business opportunity, none of which generated a significant profit or created a sustainable business. All were sold or discontinued. Currently the main focus of the Companys operations is in Mexico.  The Company had previously been pursuing various business opportunities and, effective March 1, 2004, the Company changed its principal operations to mineral exploration. Accordingly, as of March 1, 2004 the Company is considered an exploration stage company.  On May 25, 2004, the Company completed a share exchange transaction with Sierra Minerals and Mining, Inc. (Sierra Minerals), a Nevada corporation, which caused Sierra Minerals to become a wholly-owned subsidiary.  Sierra Minerals held certain rights to properties in Mexico that the Company now owns or has an option to acquire.  Through Sierra Minerals, the Company entered into an arms length joint venture agreement with Minera Rio Tinto, S.A. De C.V. (MRT), a company duly incorporated pursuant to the laws of the United Mexican States, which is controlled by an officer and director of the Company. In August 2005, the Company cancelled the joint venture agreement in order to pursue directly the mineral exploration opportunities through a wholly-owned Mexican subsidiary, Sunburst de Mexico, S.A. de C.V. (Sunburst de Mexico).  On August 25, 2005, Sunburst de Mexico, Mexoro and MRT entered into agreements providing Sunburst de Mexico the right to explore and exploit certain properties in Mexico. In December 2005, the Company and Sunburst de Mexico entered into a new agreement with MRT (the New Agreement) (note 5). On January 20, 2006, Sierra Minerals was dissolved.  2. SIGNIFICANT ACCOUNTING POLICIES  (a) Principles of consolidation  The accompanying financial statements include the accounts and activities of Mexoro Minerals Ltd. and its wholly-owned subsidiary, Sunburst de Mexico. All intercompany transactions have been eliminated in consolidation.  (b) Financial instruments  (i) Fair value  The carrying values of cash and cash equivalents, accounts receivable, and accounts payable and accrued liabilities approximate their fair values because of the short-term maturity of these financial instruments. The carrying value of convertible debentures approximates their fair value because these instruments earn interest at the market rate.  (ii) Interest rate risk  The Company is not exposed to significant interest rate risk due to the short-term maturity of its monetary current assets and current liabilities. The convertible debentures are not exposed to interest cash-flow risk because the interest rate is fixed to maturity.   - 11 -     MEXORO MINERALS LTD. (Formerly Sunburst Acquisitions IV, Inc.) (An Exploration Stage Company) Notes to Consolidated Financial Statements Three Months Ended May 31, 2006 (Unaudited) (U.S. Dollars) 2. SIGNIFICANT ACCOUNTING POLICIES (Continued)  (b) Financial instruments (Continued)  (iii) Credit risk  The Company's financial assets that are exposed to credit risk consist primarily of cash that is placed with major financial institutions.  (iv) Translation risk  The Company translates the results of non-US operations into US currency using rates approximating the average exchange rate for the year.  The exchange rate may vary from time to time.  This risk is considered nominal, as the Company does not incur any significant transactions in-non-US currency.  (c) Equipment  Equipment is recorded at cost. Depreciation is provided on a declining-balance basis at 30% on computer equipment and 20% on office furniture.  (d) Cash and cash equivalents  The Company considers all highly liquid debt instruments purchased with an original maturity of three months or less to be cash equivalents.  (e) Basic and diluted income (loss) per share  The Company computes income (loss) per share in accordance with SFAS No. 128, "Earnings per Share", which requires presentation of both basic and diluted earnings per share (EPS) on the face of the statement of operations and deficit. Basic EPS is computed by dividing income (loss) available to common shareholders (numerator) by the weighted average number of shares outstanding (denominator) during the period. Diluted EPS gives effect to all dilutive potential common shares outstanding during the period using the treasury stock method and convertible preferred stock using the if-converted method. In computing diluted EPS, the average stock price for the period is used in determining the number of shares assumed to be purchased from the exercise of stock options or warrants. Diluted EPS excludes all dilutive potential shares if their effect is anti-dilutive. All previously stated share and per share balances have been restated to give retroactive effect to the 1:50 share consolidation that occurred on February 15, 2006.  - 12 -     MEXORO MINERALS LTD. (Formerly Sunburst Acquisitions IV, Inc.) (An Exploration Stage Company) Notes to Consolidated Financial Statements Three Months Ended May 31, 2006 (Unaudited) (U.S. Dollars)  2. SIGNIFICANT ACCOUNTING POLICIES (Continued)  (f) Impairment or disposal of long-lived assets  In August 2001, the FASB issued Statement No. 144, Accounting for the Impairment or Disposal of Long-Lived Assets (FAS 144).  FAS 144 clarifies the accounting for the impairment of long-lived assets and for long-lived assets to be disposed of, including the disposal of business segments and major lines of business.  The Company has implemented FAS 144.  Long-lived assets are reviewed when facts and circumstances indicate that the carrying value of the asset may not be recoverable.  When necessary, impaired assets are written down to estimate fair value based on the best information available.  Estimated fair value is generally based on either appraised value or measured by discounting estimated future cash flows.  Considerable management judgment is necessary to estimate discounted future cash flows.  Accordingly, actual results could vary significantly from such estimates.  (g) Use of estimates  The preparation of financial statements in conformity with US generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosures of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period.  Actual results could differ from those estimates and would impact future results of operations and cash flows.  (h) Consideration of other comprehensive income items  SFAS No. 130  Reporting Comprehensive Income, requires companies to present comprehensive income (consisting primarily of net loss plus other direct equity changes and credits) and its components as part of the basic financial statements.  (i) Stock-based compensation  SFAS No. 123(R) - "Accounting for Stock Based Compensation", requires companies to estimate the fair value of share based payment awards on the date of grant using an option-pricing model. The value of the portion of the award that is ultimately expected to vest is recognized as expense over the requisite service period in the Company's financial statements. Stock based compensation expense recognized during the period is based on the value of the portion of the share based payment awards that is ultimately expected to vest during the period. The Company estimates the fair value of stock options using the Black Scholes valuation model, consistent with the provisions of SFAS No. 123(R). The Black Scholes valuation model requires the input of highly subjective assumptions, including the options expected life and the price volatility of the underlying stock.  - 13 -     MEXORO MINERALS LTD. (Formerly Sunburst Acquisitions IV, Inc.) (An Exploration Stage Company) Notes to Consolidated Financial Statements Three Months Ended May 31, 2006 (Unaudited) (U.S. Dollars)  2. SIGNIFICANT ACCOUNTING POLICIES (Continued)  (j) Income taxes  The Company accounts for income taxes in accordance with SFAS No. 109  Accounting for Income Taxes.  Deferred tax assets and liabilities are recognized with respect to the tax consequences attributable to differences between the financial statement carrying values and tax basis of existing assets and liabilities.  Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which these temporary differences are expected to be recovered or settled.  Further, the effect on deferred tax assets and liabilities of changes in tax rates is recognized in income in the period that includes the enactment.  (k) Foreign currency translation  The Companys functional and reporting currency is the United States dollar. Monetary assets and liabilities denominated in foreign currencies are translated to United States dollars in accordance with SFAS No. 52,Foreign Currency Translation, using the exchange rate prevailing at the balance sheet date. Gains and losses arising on translation or settlement of foreign currency denominated transactions or balances are included in the determination of income. Foreign currency transactions are primarily undertaken in Canadian dollars. The Company has not, to the date of these financials statements, entered into derivative instruments to offset the impact of foreign currency fluctuations.  (l) Recent accounting pronouncements  (i) In December 2004, FASB issued a revision of Statement No. 123(R),Accounting for Stock-Based Compensation.  This statement supersedes APB 25 and its related implementation guidance.  The revised pronouncement requires that all stock options and warrants be accounted for using the fair value method.  This pronouncement does not impact the Company, as the Company has no employees and currently accounts for all options and warrants using the fair value method.  (ii) In December 2004, the FASB issued SFAS Statement No. 153, Exchanges of Non-Monetary Assets.  The statement is an amendment of APB Opinion No. 29 to eliminate the exception for non-monetary exchanges of similar productive assets and replaces it with a general exception for exchanges of non-monetary assets that do not have commercial substance.  The Company believes that the adoption of this standard will have no material impact on its financial statements. The Company accounts for income taxes in accordance with SFAS No. 109 Accounting for Income Taxes.  Deferred tax assets and liabilities are recognized with respect to the tax consequences attributable to differences between the financial statement carrying values and tax basis of existing assets and liabilities.  - 14 -     MEXORO MINERALS LTD. (Formerly Sunburst Acquisitions IV, Inc.) (An Exploration Stage Company) Notes to Consolidated Financial Statements Three Months Ended May 31, 2006 (Unaudited) (U.S. Dollars)  2. SIGNIFICANT ACCOUNTING POLICIES (Continued)  (l) Recent accounting pronouncements (Continued)  (iii) In March 2005, FASB issued Interpretation No. 47 (FIN 47),Accounting for Conditional Asset Retirement Obligations.  FIN 47 clarifies that the term conditional asset retirement obligation as used in FASB Statement No. 143, Accounting for Asset Retirement Obligation, refers to a legal obligation to perform an asset retirement activity in which the timing and/or method of settlement are conditional on a future event that may or may not be within the control of the entity.  Accordingly, an entity is required to recognize a liability for the fair value of a conditional asset retirement obligation if the fair value of the liability can be reasonably estimated.  FIN 47 is effective no later than the end of fiscal years ending after December 15, 2005.  This pronouncement does not impact the Company for the current year.  (iv) In May 2005, FASB issued SFAS No. 154 Accounting Changes and Error Corrections  a replacement of APB Opinion No. 20 and FASB Statement No. 3.  This Statement replaces APB Opinion No. 20, Accounting Changes, and FASB Statement No. 3, Reporting Accounting Changes in Interim Financial Statements, and changes the requirements for the accounting for and reporting of a change in accounting principles.  This statement applies to all voluntary changes in accounting principles.  It also applies to changes required by an accounting pronouncement in the unusual instance that the pronouncement does not include specific transition provisions.  When a pronouncement includes specific transition provisions, those provisions should be followed.  This statement is effective for accounting changes and corrections of errors made in fiscal years beginning after December 15, 2005  (v) In February 2006, the FASB issued SFAS No. 155, Accounting for Certain Hybrid Financial Instruments, an amendment of FASB Statements No. 133 and 140. This statement permits fair value re-measurement for any hybrid financial instrument that contains an embedded derivative that otherwise would require bifurcation. It establishes a requirement to evaluate interests in securitized financial assets to identify interests that are freestanding derivatives or that are hybrid financial instruments that contain an embedded derivative requiring bifurcation. In addition, SFAS 155 clarifies which interest-only strips and principal-only strips are not subject to the requirements of Statement 133. It also clarifies that concentrations of credit risk in the form of subordination are not embedded derivatives. SFAS 155 amends Statement 140 to eliminate the prohibition on a qualifying special purpose entity from holding a derivative financial instrument that pertains to a beneficial interest other than another derivative financial instrument. This statement is effective for all financial instruments acquired or issued after the beginning of an entitys first fiscal year that begins after September 15, 2006. The adoption of this standard is not expected to have a material effect on the Companys results of operations or financial position.  - 15 -     MEXORO MINERALS LTD. (Formerly Sunburst Acquisitions IV, Inc.) (An Exploration Stage Company) Notes to Consolidated Financial Statements Three Months Ended May 31, 2006 (Unaudited) (U.S. Dollars)   3. GOING-CONCERN  The accompanying financial statements have been prepared on a going-concern basis.  The Company has a history of operating losses and will need to raise additional capital to fund its planned operations.  As at May 31, 2006, the Company had working capital of $2,060,806 (February 28, 2006 - $45,944) and a cumulative loss of $35,557,226 (February 28, 2006 - $32,442,550).  These conditions raise substantial doubt about the Companys ability to continue as a going-concern.  The Company intends to reduce its cumulative loss through the attainment of profitable operations, from its investment in a Mexican mining venture (note 5).  In addition, the Company has conducted private placements of convertible debt and common stock (notes 7 and 9), which have generated a portion of the initial cash requirements of its planned Mexican mining ventures (note 5).  4. EQUIPMENT  May 31, 2006February 28, 2006AccumulatedCostDepreciationNetNetOffice equipment$2,842$(117)$2,725$880  5. MINERAL PROPERTIES  On May 3, 2004, the Company entered into a share exchange agreement with the shareholders of Sierra Minerals.  Pursuant to the terms of the share exchange agreement, the Company issued 860,000 shares of its common stock (43,000,000 pre-split) in exchange for all of the outstanding shares of Sierra Minerals.  As a result, Sierra Minerals became a wholly-owned subsidiary of the Company.  The common stock issued was valued at $12.75 per share ($0.255 pre-split) or $10,965,000; which represents the fair value based on the date of the share exchange agreement (May 3, 2004).  Finders fees of 120,000 options (6,000,000 pre-split) to purchase the same number of shares of the Companys common stock at $0.50 per share (0.01 pre-split) were issued to non-related parties in connection with this share exchange. The fair value of these options issued as finders fees was $1,523,000; this amount was determined using the Black-Scholes formula with a 5-year expected life, a volatility factor of 191%, a risk-free rate of 5% and no assumed dividend rate.  Due to the uncertainty of the future revenue to be generated from this property, the cost of the acquisition of $10,965.000, compensation expense of $1,523,000, and advances totalling $507,500 were charged to operations in the year ended February 28, 2005.  Sierra Minerals was a party to a joint venture agreement, dated April 26, 2004 and amended on June 1, 2004, by and between Sierra Minerals and MRT, a Mexican company.  MRT had interests in exploration properties.    - 16 -     MEXORO MINERALS LTD. (Formerly Sunburst Acquisitions IV, Inc.) (An Exploration Stage Company) Notes to Consolidated Financial Statements Three Months Ended May 31, 2006 (Unaudited) (U.S. Dollars)   5. MINERAL PROPERTIES (Continued)  On August 25, 2005, the joint venture agreement was cancelled and the Company entered into a new arrangement with MRT.  Instead of a joint venture, the Company incorporated a Mexican wholly-owned subsidiary, Sunburst de Mexico.  This restructuring allowed the Company to take title to the properties directly in the name of Sunburst de Mexico.  The Company entered into agreements with MRT, which provided Sunburst de Mexico options on the concessions of the Cieneguita and Guazapares properties and the right of first refusal on two Encino Gordo properties (collectively, the Property Agreements). The parties also entered into an operating agreement, which gave MRT the sole and exclusive right and authority to manage the Cieneguita Property.  On December 8, 2005, the Company and Sunburst de Mexico entered into the New Agreement with MRT to exercise their option under the August 18, 2005 sale and purchase of mining concessions agreement to obtain two mining concessions in the Encino Gordo region.  The New Agreement also provided the Company the option to obtain three additional concessions in the Encino Gordo region.  These properties are located in the state of Chihuahua, Mexico.  The following are additional material terms of the New Agreement:  (a) The operators agreement with MRT was cancelled;  (b) The Company granted MRT the option to buy all of the outstanding shares of Sunburst de Mexico for $100 if the Company failed to transfer $1,500,000 to Sunburst de Mexico by April 30, 2006. However, in April 2006, the parties amended the New Agreement to delete both the required transfer of $1,500,000 to Sunburst de Mexico and MRTs option to purchase shares of Sunburst de Mexico;  (c) The Property Agreements were modified to change the net smelter rate to a maximum of 2.5% for all properties covered by the agreements;  (d) The Company agreed to issue 2,000,000 shares of the Companys common stock to MRT within four months of the date of the signing of the New Agreement.  These shares were issued to MRT and its assignee at the market value of $1.05 per share on February 23, 2006. This issuance fulfilled the Companys payment obligations under the previous Property Agreements; and  (e) The Company agreed to issue 1,000,000 additional shares of the Companys common stock to MRT if and when the Cieneguita Property is put into production and reaches 85% of production capacity over a 90-day period, as defined in the New Agreement.  6. PROMISSORY NOTES  As at May 31, 2006 the Company had $nil (February 28, 2006 - $412,800) promissory notes outstanding and accrued interest of $nil (February 28, 2006 - $7,259) outstanding on the promissory notes.  On March 4, 2006, the Company agreed to issue 1,651,200 common shares at a price of $0.25 per share to settle $412,800 in promissory notes payable. As a condition, the promissory note holders would waive all accrued interest payable on the notes. On April 6, 2006, these shares were issued (note 9) and the Company recorded a $7,259 gain on settlement of debt.  - 17 -     MEXORO MINERALS LTD. (Formerly Sunburst Acquisitions IV, Inc.) (An Exploration Stage Company) Notes to Consolidated Financial Statements Three Months Ended May 31, 2006 (Unaudited) (U.S. Dollars)  7. CONVERTIBLE DEBENTURES  On August 25, 2004, the Company entered into a securities purchase agreement (the Agreement), with Bristol Investment Fund, Ltd., Alpha Capital AG and Stonestreet LP (the Purchasers). Pursuant to the Agreement, the Purchasers agreed to purchase up to $1,350,000 in face amount of secured convertible debentures (the Debentures) from the Company.  The Debentures did not bear interest but were to be issued at a 26% discount to the face amount. Accordingly, the cash purchase price for the full $1,350,000 face amount of the Debentures was $1,000,000.   The Debentures were due and payable in full one year from the date of issuance.  The Purchasers also had the right to convert the full-face amount of the Debentures to common stock of the Company at a price of $5.00 per share ($0.10 pre-split).  Under the Agreement, the Purchasers were also to receive warrants and additional investment rights to purchase shares of the Companys common stock. The warrants were exercisable at a price of $6.00 per share ($0.12 pre-split) for a period of five years and additional investment rights were exercisable at a price of $5.00 per share ($0.10 pre-split).  The Purchasers purchased a total of $675,000 in face amount for cash proceeds of $500,000 and the $175,000 discount was charged as interest over the term of the debenture; $87,500 in the year ending February 28, 2005 and the $87,500 in the year ending February 28, 2006. The Company paid $20,000 in legal fees and $50,000 administration fees.  A beneficial conversion feature expense of $500,000 resulting from the anticipated conversion of the debentures, and the exercise of the associated warrants and additional investment rights of the above debentures was recorded as interest expense for the year ending February 28, 2005.  On August 10, 2005, the Company and the Purchasers agreed to retire the Debentures including all associated principal, terms, warrants and rights for the amount of $500,000 plus 8% interest.  On September 21, 2005, the Company repaid in full $500,000 plus interest charges of $41,815 to the Purchasers. As a result of this payment, the Debentures were terminated and the associated warrants and additional investment rights were cancelled. A gain of $133,185 was recorded for settlement of this debt.  Another convertible debenture in the amount of $30,000 was issued on January 15, 2004. The conversion of principal and accrued interest (8% per year) was at the rate of $1.00 ($0.02 pre-split) per share of common stock. On December 21, 2005, the Company repaid the $30,000 convertible debenture plus accrued interest of $4,645.  The Company issued $300,000 in convertible debentures in December 2005 to three lenders with a maturity date of December 8, 2006, accrued interest at 7% per year, and convertible at the option of the holder into shares of common stock at $0.15 per share. On January 6, 2006, these debentures were converted and the Company issued 2,000,000 common shares (100,000,000 pre-split). A beneficial conversion feature of $300,000 was recorded in interest expense as to the anticipated conversion of these debentures, with a corresponding increase in additional paid in capital.  In January 2006, the Company issued convertible debentures, with principal and accrued interest at 7% per year, convertible into units at the option of the holder.  Each unit consists of a warrant to purchase 25,000 common shares at $1.00 per share and $25,000 of debt, which may be converted to common shares at $0.50 per share and is exercisable until April 30, 2008.  As at February 28, 2006, the Company had issued convertible debentures in the amount of $652,000.  - 18 -     MEXORO MINERALS LTD. (Formerly Sunburst Acquisitions IV, Inc.) (An Exploration Stage Company) Notes to Consolidated Financial Statements Three Months Ended May 31, 2006 (Unaudited) (U.S. Dollars)  7. CONVERTIBLE DEBENTURES (Continued)  A beneficial conversion feature of $489,000 was recorded in interest expense as to the anticipated conversion of these debentures. Also included in interest expense was $163,000 representing the relative fair value of the warrants (immediately exercisable) in relation to the convertible debt.  In the quarter ended May 31, 2006, the Company issued an additional $2,265,500 of convertible debentures, with principal and accrued interest at 7% per year, convertible into units at the option of the holder. Each unit consists of a warrant to purchase 25,000 common shares at $1.00 per share and $25,000 of debt, which may be converted to common shares at $0.50 per share and is exercisable until April 30, 2008. A beneficial conversion feature of $1,359,300 was recorded in interest expense as to the anticipated conversion of these debentures. Also included in interest expense was $906,200 representing the relative fair value of the warrants (immediately exercisable) in relation to the convertible debt. As at May 31, 2006 there were $2,917,500 convertible debentures outstanding (note 13).   8. PREFERRED STOCK  The Company is authorized to issue 20,000,000 shares of preferred stock.  The Companys board of directors is authorized to divide the preferred stock into series, and with respect to each series, to determine the preferences and rights and qualifications, limitations or restrictions thereof, including the dividend rights, conversion rights, voting rights, redemption rights and terms, liquidation preferences, sinking fund provisions, and the number of shares constituting the series and the designations of such series.  The board of directors could, without stockholder approval, issue preferred stock with voting and other rights that could adversely affect the voting rights of the holders of common stock, which issuance could have certain anti-takeover effects.   9. COMMON STOCK  Numberof SharesAmountBalance, February 28, 200612,799,902$15,583,977Issued pursuant to private placement750,000375,000Issued pursuant to settlement of promissory notes1,651,200412,800Balance, May 31, 200615,201,102$16,371,777  On April 3, 2006 and May 31, 2006 the Company issued 550,000 and 200,000 common shares respectively pursuant to a private placement unit offering. Units consisted of one share of common stock and one-half of one warrant. Each full warrant entitles the investor to purchase an additional share of the Companys common stock at a price of $1.00 per share and is exercisable until April 30, 2008.  On March 4, 2006, the Company agreed to issue 1,651,200 common shares at a price of $0.25 per share to settle $412,800 in promissory notes payable.(note 6), and on April 6, 2006, these shares were issued.    - 19 -     MEXORO MINERALS LTD. (Formerly Sunburst Acquisitions IV, Inc.) (An Exploration Stage Company) Notes to Consolidated Financial Statements Three Months Ended May 31, 2006 (Unaudited) (U.S. Dollars)  10. STOCK COMPENSATION PROGRAM  On December 9, 2005, the Companys board of directors approved a stock compensation program, which was subsequently ratified at an extraordinary meeting of shareholders held on February 13, 2006. In order to maintain flexibility in the award of stock benefits, the program constitutes a single omnibus plan, but is composed of three parts. The first part is the qualified incentive stock option plan (the ISO Plan), which provides grants of qualified incentive stock options (ISOs).  The second part is the non-qualified stock option plan (NQSO Plan), which provides grants of nonqualified stock options (NQSOs).  The third part is the restricted shares plan (Restricted Shares Plan), which provides grants of restricted shares of the Companys common stock (Restricted Shares). The maximum number of common shares that may be purchased under the plan is 6,000,000.  Options granted under the plan include incentive and non-qualified stock options as well as actual shares of common stock, with vesting determined on the grant date, not to exceed 10 years, and are exercisable over a 10-year maximum period at a price to approximate the fair market value of the common stock at the date of grant.  On February 27, 2006, the Company granted 800,000 ISOs under the ISO Plan to directors, officers and consultants at a price of $0.50 per common stock for a period of ten years. The ISOs vest in four equal instalments, at the time of the grant and then every six months thereafter. Compensation cost, being the fair value of the options, is calculated to be $982,000 of which $248,000 is expensed on the date of issue and as the remainder vest.  The fair value of the 800,000 options was determined using the Black-Scholes option pricing model using a ten-year expected life of the option, a volatility factor of 152%, a risk-free rate of 5% and no assumed dividend rate.  The options are summarized as follows:  WeightedAverageExerciseOptionsPriceOutstanding at February 28, 2005168,000$ 0.94Granted800,000$ 0.50Cancelled(6,000)$ 1.50Exercised(32,000)$ 1.34Outstanding at February 28, 2006930,000$ 0.54Outstanding at May 31, 2006930,000$ 0.54   - 20 -     MEXORO MINERALS LTD. (Formerly Sunburst Acquisitions IV, Inc.) (An Exploration Stage Company) Notes to Consolidated Financial Statements Three Months Ended May 31, 2006 (Unaudited) (U.S. Dollars)  10. STOCK COMPENSATION PROGRAM (Continued)  The following table summarizes options outstanding at May 31, 2006:  Exercise PriceNumber of Options IssuedNumber of Options ExercisableRemaining Contractual Life (Years)$0.50890,000290,0009.06$1.5040,00040,0003.75930,000330,000  The Company has reserved 930,000 common shares in the event that these options are exercised.  For the quarter ended May 31, 2006, there were $nil (2005 - $nil) stock-based compensation expenses.  11. WARRANTS  As at May 31, 2006, the Company had a total of 8,292,500 (February 28, 2006 - 5,652,000) warrants outstanding to purchase common stock. Each warrant entitles the holder to purchase one share of the Companys common stock. The Company has reserved 8,292,500 common shares in the event that these warrants are exercised.  The warrants include 1,000,000 Class A Warrants exercisable at $0.50 per share, 1,000,000 Class B Warrants exercisable at $0.75 per share, 1,000,000 Class C Warrants exercisable at $1.00 per share, 1,000,000 Class D Warrants exercisable at $1.25 per share, and 1,000,000 Class E Warrants exercisable at $1.50 per share; of which all are exercisable at the option of the holder. The Class A Warrants were fully vested upon issuance. They are exercisable at any time following their issuance but will expire on June 30, 2007 to the extent they are not exercised. The remaining classes of Warrants will each vest and become exercisable only at the time that the immediately preceding class has been fully exercised.  Unless terminated earlier as a result of failure to vest, the Class B and Class C Warrants will each expire on December 31, 2007, and the Class D and Class E Warrants will each expire on December 31, 2008.  Stock-based compensation of $3,898,000 has been recorded on these warrants.  The Company has also issued 2,917,500 warrants exercisable at $1.00 each pursuant to the issuance of convertible debentures (note 7). These warrants expire on April 30, 2008, and are redeemable by the Company, at $.01 per share, in the event the Companys Common Stock closes with a bid price, on average, over $3.00 per share for a consecutive 20 day period.  The Company has also issued 375,000 warrants exercisable at $1.00 each pursuant to a private placement unit offering. Each warrant entitles the investor to purchase an additional share of the Companys common stock at a price of $1.00 per share and is exercisable until April 30, 2008.  - 21 -     MEXORO MINERALS LTD. (Formerly Sunburst Acquisitions IV, Inc.) (An Exploration Stage Company) Notes to Consolidated Financial Statements Three Months Ended May 31, 2006 (Unaudited) (U.S. Dollars)   12. RELATED PARTY TRANSACTIONS  The Company paid management fees of $58,050 (2005 - $nil) to certain officers and directors and to companies controlled by directors. The Company paid $18,137 (2005 - $nil) to certain officers and directors and to companies controlled by directors for travel, office and other related expenses.  As at May 31, 2006, accounts payable of $175 (2005 - $nil) were owing to certain officers and directors of the Company and $5,339 (2005 - $nil) was owing to companies controlled by directors.  As of May 31, 2006, the Company had a note payable to former related entity in the amount of $nil (2005 - $28,500).  Interest on this note was imputed at a rate of 6.09% and totalled $nil (2005 - $19,268) cumulatively at May 31, 2006.  All related party transactions are in the normal course of business at the exchange amount agreed to by each party.  13. SUBSEQUENT EVENTS  (a) Convertible debentures  Subsequent to May 31, 2006, the Company received requests to convert $2,917,500 of convertible debentures to the Company common shares at $0.50 per share, and issued 5,835,000 common shares and paid accrued interest of $58,817.                     - 22 -     ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATIONS  CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING STATEMENTS  Certain statements contained in this Form 10-QSB constitute "forward-looking statements". These statements, identified by words such as plan, "anticipate", "believe", "estimate", "should", "expect" and similar expressions include our expectations and objectives regarding our future financial position, operating results and business strategy. These statements reflect the current views of management with respect to future events and are subject to risks, uncertainties and other factors that may cause our actual results, performance or achievements, or industry results, to be materially different from those described in the forward-looking statements. Such risks and uncertainties include those set forth under this Item 2. "Management's Discussion and Analysis or Plan of Operation" and elsewhere in this Form 10-QSB.  We do not intend to update the forward-looking information to reflect actual results or changes in the factors affecting such forward-looking information. We advise you to carefully review the reports and documents we file from time to time with the Securities and Exchange Commission (the SEC), particularly our annual reports on Form 10-KSB, our quarterly reports on Form 10-QSB and our current reports on Form 8-K.   Overview  We are a start-up, exploration stage company and have not yet generated or realized any revenues from our exploration projects, which we commenced in May 2004. We have sufficient cash to maintain our operations until April 2007, unless our exploration is successful, of which there is no guarantee.  If our exploration is successful, we will need to raise additional funds to meet our needs for additional exploration and/or production.  Our continued existence and plans for future growth depend on our ability to obtain the additional capital necessary to operate either through the generation of revenue or the issuance of additional debt or equity. While we believe that we raised sufficient funds in our recent private placement offerings to allow us to continue in business until April 2007, we may not be able to continue in business beyond that date unless we obtain additional capital.  We have not generated any revenues, and no revenues are anticipated unless and until mineralized material is discovered on the properties in which we have an interest.  We are not planning to buy or sell any plant or significant equipment in the next six months.  In the event that our exploration is successful on our Cieneguita Property, we anticipate spending approximately $1,500,000 on equipment and building a plant to put that property into production.  The ability to buy such equipment would be dependent upon our cash position at that time and our ability to raise additional capital.   Currently, though, the Cieneguita Property has no known ore reserves.   Plan of Operation  Our business plan is to proceed with the exploration of our Mexican mineral properties to determine whether they contain commercially exploitable reserves of gold, silver or other metals.  We believe that we have sufficient funds to fund our current exploration plans and meet our monthly general and administrative costs until April 2007 without the need to raise additional funds.   . After that time, we will neither have sufficient funds to continue our exploration plans nor funds for general administrative expenses.  As a minimum, we will need to raise additional working capital to maintain basic operations.  We would plan to raise those funds through the sale of equity or debt.  At this time we do not have any sources to raise additional capital for the company and no assurance may be given that we will be able to find sources to raise additional capital.  Failure to raise any additional capital would most likely require us to cease operations and abandon all of our  - 23 -     exploration properties. In the event that our exploration program should find exploration targets that warrant additional exploration work, including exploration by drilling, we may not have enough cash available to fund an expanded exploration program. If we decide to expand our exploration program, we would need to raise additional capital to meet these needs. We currently do not have any sources of additional capital available to us and we may not have any in the future.  The failure to raise additional capital would severely curtail our ability to conduct any additional exploration work that might be warranted because of the results of our current exploration program.  We are not involved in any research and development on our exploration properties.  In the event that we did discover a mineral deposit on one of our properties (other than Cieneguita), of which there is no guarantee, we would need to expend substantial amounts of capital to put any of our properties into production, if so warranted.  The amount of such expenditures is indeterminable at this time as we do not have any exploitable ore reserves and with the current stage of exploration on the properties have no way to determine such expenditures.  Such expenditures are dependent upon the size of the ore body, the grade of the ore and the type of mining that is required to extract any minerals that may be found.  Regardless, we do not have enough capital available to us to make any such expenditures that would be required to put any mineral property into production, and we therefore would have to raise the additional capital or, if possible, enter into a joint venture for the production phase.  If we were to form a joint venture, we cannot assess what our final position in the project would be.  We do not have any sources of capital available to us at this time to fund such a project if one should be discovered.  We plan to hire a Vice President of Exploration in August 2006 to conduct our exploration programs and a geologist to assist him.  We also have hired an office administrator in our office in Chihuahua.  We plan to hire another geologist by the end of December 2006.  Other than the one additional geologist, we do not expect any significant change in additional contractors to conduct exploration over the next 12 months.  Other than the VP of Exploration, all of the employees we hire, including those involved in the exploration work we are conducting, are contracted from third parties specializing in providing employees for Mexican companies.   In using such a firm, we minimize our exposure to Mexican employment law.  Such liabilities are undertaken by the third party providing the services.  We pay a flat rate to the third party for their services.  In the event that we should find a mineable reserve, it is managements intention to contract the mining of any ore reserves out to third parties.  The milling of the ore will be done by hiring employees for the company and not through a third party provider of such services.  In the event we should put the Cieneguita property into production in the next 12 months, we would anticipate hiring 2 mine managers and 4 additional employees to work on the milling of the ore.  We do not have any known reserves at this time.  Cieneguita Property  Because we already have data from the previous exploration programs and mining records from Glamis Gold, our exploration program, planned until the end of April 2007, on the Cieneguita Property will focus mainly on identifying mineralized zones of economic grade to allow for the property to be put into production as an open pit heap leach mine.  The following steps summarize the exploration we have done to date on the Cieneguita Property, as well as our plans.  1. Phase 1 Exploration.  Budget: We expect the Phase 1 exploration program to cost approximately $200,000.  The funds  - 24 -     will come from our general working capital.  Milestones: The milestones for the phase 1 exploration program include the review of available data to create a structural mineralization framework, detailed soil and rock sampling, resampling existing trenches, the extension of existing trenches, and the creation of new trenches.  We are conducting cyanide testing on the rock to determine the best method of leaching the precious metals from the rock.  We plan to complete phase 1 of our exploration program by the end of December 2006.  In April 2006, we completed a sampling of the property that included more than 500 meters of deep trenches from which we took comprehensive channel sampling.  The trenches comprised 8 trenches approximately 200 meters long and 2 to 10 meters deep spaced equally along the 1,000 meters strike length of the property.  From the walls of these trenches, we took approximately 550 rock samples.  One half of these samples were sent to ALS Chemexs laboratory in Chihuahua for assaying. The sampling protocol followed the best mining practices. The purpose of the sampling was to further define the ore grade and potential of the property.  We also completed detailed soil sampling and rock sampling outside of the trenches.  The other half of the sample was used to complete column tests to determine the leachability of the precious metals from the rock.  In this test, the ore was placed in PVC tubes, and different mixtures of a cyanide solution were dripped over the top of the columns at different flow rates.  The results from these tests will help determine the most effective solution to be used on the heap leach pads on the property.  These tests were done by qualified geologists employed by MRT as part of our office package costs.  The tests were scientifically conducted and monitored for quality control and efficacy.  These tests were done to ensure that the metallurgy of the minerals allows for economic recovery of the precious metals using a cyanide heap leach process.  The results of these tests should be available by the end of July 2006.  By December 2006, we plan to complete a detailed mapping of the property using existing information and drill results from previous operators, as well as incorporating our own data.  To this end, we will create a structural mineralization framework for the property.  We do not have any proven reserves on this property.  If, after receiving the results of the first phase of exploration and considering the recommendations of our VP of Exploration and senior geologist, management decides that further exploration is warranted, we will continue to the second phase of exploration.  2. Phase 2 Exploration.  Budget: We plan to commence phase 2 of our exploration program in March 2007 under the direction of our VP of Exploration.  We have budgeted $200,000 for the Phase 2 Exploration; consisting of $50,000 for an additional trenching program, $50,000 for general administrative expenses and $100,000 for the cost of a drilling program, assaying and supervision included.  Milestones: The objectives for phase 2 of the exploration plan are to initiate a drill program and to continue the trenching program from phase 1 of exploration in order to further delineate the oxide ore mineralization to define where we plan to attempt to mine the ore.  We plan to complete this second phase of exploration by the end of May 2007.  Subject to the recommendation of our VP of Exploration, we may initiate a drill program consisting of 1,000 meters of reverse circulation drilling.  At this time, there is a high demand for drill rigs, and we cannot predict with any accuracy the timing to start the drilling program.  Once we do receive a rig, we anticipate the drilling program will take approximately one month, with assay results available one month later.  The funds for this drilling program will come from general working capital on hand.  We  - 25 -     hope that the results from this drilling will help us to better delineate the mineralization of the oxide zone and provide an ore reserve calculation.  We do not intend to implement a feasibility study for the property in this phase of exploration.  Six of the drill holes will be drilled to a depth of 200 meters to test the sulphide potential of the mineral system.  The use of these deep holes will help us determine if there is an extension to the oxide mineralization in the underlying sulphides.  Our onsite geologist will determine where the holes will be drilled based on our earlier exploration and mapping of the property.  We are currently negotiating with several contractors to secure the use of a drill to undertake our drill program.  To date, we have not found a contractor able to supply drills to meet our time schedule.  We cannot, with any certainty, predict when a drill rig may become available to us.  The unavailability of such drill rigs could hamper our exploration plans, but management believes that we can generate sufficient information from the trenching program, to mine the oxide mineralization on the property.  We have not determined any known reserves on this property to date.  The trenching program will entail using a bulldozer to dig trenches.  Our on-site geologist will direct the bulldozer operator as where to dig the trenches. The geologist will base his decision on where to dig on the results of our previous exploration work.  Once the trenches are dug, the geologist will take samples of rock from all levels of the walls of the trench as if it were rock from a drill core.  The rock will be gathered up and marked from which part of the trench it came from.  The ore is pulverized and shipped out for assays.  The results from these assays are expected to be completed and mapped by May 2007, with the goal of further delineating the prospects of the property.  Even though the rock is fractured, the objective of the drill program will be to provide us with accurate information to make an ore calculation of the grade of the ore and the size of the mineralized zones.  One of the main purposes of this phase of exploration is to delineate the mineralized ore body and map the grade of the mineralization that will allow us to refine our plan to put the property into production.  If the exploration program does not provide us with the results we deem necessary to continue exploration, then, on a recommendation from our senior geologist or VP of Exploration and managements concurrence on his findings, we will cease exploration on the property and any plans to put the property into production.  If no further exploration is warranted, then we will discontinue any payments to the concession holders and allow our option to lapse.  We will also then try to sell the mining equipment we have recently purchased.  If we allow the option to lapse, we will be obligated, by the Mexican Government, to complete some reclamation work on the property of approximately $50,000.  These funds would come from the bond we have already paid to the government in the amount of $67,000.   Any funds not expended on reclamation would be returned to us by the Government.   All of the money that we had invested in the exploration of the Cieneguita Property would be lost.  We have one geologist on the Cieneguita Property working full time, and he will continue to do so through April 2007 if the exploration results warrant the expenditure.  If the results do not warrant further work, we plan to move this geologist to one of our other properties to continue exploration on those properties.  3. Cieneguita Mine Design.   Budget: We budgeted $50,000 from general working capital to be used to create the mine design for the Cieneguita property.  Milestones: Concurrently with the second phase of exploration, we will implement our plan to put the Cieneguita Property into production.  The mine design will help determine where and how we will mine the Cieneguita Property.  We plan to put the mine into production by the end of May 2007 if we are able to find available funding.  - 26 -      Coinciding with phase 2 of our exploration program, we will commission a mine design to determine how to put the Cieneguita Property into production.  At this time, we do not plan to implement a feasibility study for this property but feel we have sufficient information to put the property into production.  The mine design will be commissioned to a third party contractor with expertise in heap leach mining. This contractor, an engineering firm, will review all of the data that we have accumulated from Glamis Golds previous exploration and from the trenching and sampling we have completed on the property.  All of this information will be put on a map laying out the structure of the mineralized zone on our property to assist in mining the ore.  The key purpose of this map is to help enable our on-site geologist to monitor grade control during mining.  Additionally, from the information accumulated so far on the Cieneguita Property, the mining engineer will design a heap leach mining operation best suited to the tonnage, grade of the ore and availability of land to build leaching pads.  The mine design will call for the mining operation to be run by a third party contractor, who will charge the company a flat fee per tonne of rock that is moved.  It is estimated by the engineer designing the mine that the cost per tonne of rock moved from the property to the mill site will be approximately $1.30 per tonne of rock.  This fee is only an estimate, as no contractor at this time has been engaged to mine the mineralized ore nor provided us with a firm quote on the cost of mining.  The actual cost of mining the ore may be much higher, and no assurance can be given as to the actual cost at this time.  The engineering firm who will design the mine has stated that one of the key objectives at this stage of the mining operation will be grade control.  The proper grade of ore shipped to the milling site is imperative to ensure a profitable operation.  If the head grade is too low, we will not recover enough gold from the rock to maintain a profitable operation.  Conversely, a head grade of ore that is too high will shorten the life of the mine.  We are estimating that the total cost of mining and milling the ore will be approximately $13 per tonne.  If the price of gold fluctuates up or down, we may have to adjust our cut off grade, which is currently 1.5 grams per tonne, which will affect the over all life of the mine.  The milling of the ore at the mine site will also be contracted out to a third party.   The following is a brief description of the mining process we plan to use.  First, the ore is crushed by a crusher into a smaller size.  Second, the rock is deposited on a conveyor belt and moved to the agglomorator.  Third, the agglomorator mixes the rock with lime, and then the rock is moved to a stacker.  A stacker is a moveable conveyor belt that oscillates back and forth, distributing the rock equally onto a heap leach pad.  At that point, the rock is sprinkled with a cyanide mixture for approximately 30 days.  The fluid from the percolation through the rock is then pumped through carbon filters.  Waste rock is dumped into a ravine, per our permits, while the carbon filters are shipped to a third party for extraction of the precious metals.  The waste rock is completely free of any harmful chemicals and is restored to the original ph it had prior to mining.  At this time, we do not know the cost associated with the process of having the precious metals extracted and minted into ore bars.  If our head grade is not accurate or the heap leach process is not effective, we may not extract enough gold from the carbon filters to pay for this complete operation and we would lose money from the mining operation.  If we lost money on the mining and milling operation, we may not be able to stay in business as we would expect the cash flow from operations to cover, at the minimum, the mining and milling operation.  Furthermore, we do not have any proven reserves on our property and the ability to find enough ore could severely hinder any mining operations.  We will engage an independent third part consultant to review the work of the engineering firm to verify and agree with the results of the mine design.  The independent third party engineers will work with the mining engineering firm to agree on a final design.  We estimate that the mine design will be completed by the end of December 2006 and will cost approximately $50,000.  We will pay for the work from our general working capital.  The milling equipment and cost of building the plant will be approximately $2,200,000.  We estimate that we will need approximately $1,100,000 for working capital  - 27 -     during the first four months of operation of the mine.  There can be no assurance given that if the property is put into production that, after four months of operation, we will have recovered any precious metals from the milling process.  We will need to continue to fund working capital if the precious metals are not in the ore as predicted.  We will need to raise additional capital to put the property into production and to fund at least the first four months of working capital.  The funds would be raised through the sale of debt or equity.  We have not identified any additional sources of capital at this time.  Furthermore, once we have commenced production, we can give no assurance that we will be profitable or recover any gold.  Guazapares Property  1. Phase 1 Exploration.  Budget: Concurrently with the exploration of the Cieneguita Property, we have budgeted approximately $450,000 of our general working capital for exploration on our Guazapares Property until April 2007.  These funds will come from our general working capital.  Milestones: The goals of the first phase of exploration on the Guazapares Property are to collect rock sample and complete the mapping of the property.  We anticipate that this phase will be completed by the end of January 2007.  If management determines that the results warrant additional exploration, we will begin phase 2 of exploration, as described below.  We believe that most of the mining concessions being explored in the Guazapares area are epithermal silver deposits similar to the Cieneguita Property.  However, because we do not have the same amount of detailed information on Guazapares as we do on Cieneguita, the exploration program will cost more than the exploration program on Cieneguita.  We have one full time geologist working on the Guazapares Property collecting rock samples and mapping the property.  The goal for this phase is the completion of mapping on the property at a scale of 1:5,000 with individual veins being mapped at a scale of 1:1,000.  Rock samples were taken from the property.  The rock samples from this phase were sent to Chemex ALS in Chihuahua for chemical analysis and assaying. The sampling protocol followed the best mining practices. The results from this first phase of the exploration program have the goal of determining whether subsequent exploration was warranted and if a drill program should be commenced.   This phase 1 of work includes reviewing available data to create a structural mineralization framework.  We will map the topography and sample the entire underground workings along the main level of the San Antonio mine. The distribution of the veins, lithology and alteration will be mapped.  2. Phase 2 Exploration.  Budget: We have budgeted $100,000 of the total of $450,000 for Phase 2 of exploration.  Of this, $50,000 is budgeted for a ground based geophysical exploration that will concentrate mainly on the area around the San Antonio mine and $50,000 for specific sampling and trenching on the San Francisco property.  These funds will come from general working capital of the company.  Milestones: The goals of phase 2 of exploration are to conduct more detailed soil and rock sampling, perform ground-based geophysical measurements, map the topography, and sample trenches in order to define the structural framework of the mineralized zone to facilitate a drilling program, if warranted.  This phase commenced in February 2007 and is expected to be completed by the end of May 2007.  The second phase of the exploration program, using two geologists, will include more detailed soil and rock sampling, ground-based geophysics measurements and mapping on all of the concessions at Guazaparez.  At this time, though, we do not have enough information to implement a drill program.  One  - 28 -     of the objectives of this stage of exploration will be to conduct a ground based geophysical exploration that will concentrate mainly on the area around the San Antonio mine.  Another target will be to map the topography and sampled the surface trenches in the San Francisco area.  The purpose of this phase of exploration will be to define the structural mainframe of the mineralized zone to facilitate the placing of drill holes.  Once this information is obtained from phase two of the exploration project, our senior geologist and our new VP of Exploration will review all of the data collected and make a recommendation to management.  Management, at that time, will review the exploration data collected and the recommendations and make a determination whether additional work is advisable.  If the management determines that additional exploration is not warranted, then we will likely discontinue exploration and make no further property payments, abandoning the concessions.  If we abandon the Guazapares Property, we will not have to make any further property payments as per our property purchase agreements.  We will, however, lose all the funds we have expended on the property to date including property payments made to date.  If management determines that further exploration is warranted, we will conduct phase 3 of our exploration program.  3. Phase 3  Drill Program.  Budget: If a drill program is warranted and implemented, we estimate that the initial expenditure will be $250,000 (the balance of the $450,000 budgeted for the property).  We will need to raise additional capital through the sale of equity or debt to fund a complete drilling program as only a small portion of the funds budgeted will be left in our general working capital to initiate the program.  Milestones: The goal of the third phase of exploration would be to gather information to determine if we should put the property into production.  We do not have enough information at this time to determine any specifics on how the drilling phase of the exploration program would be implemented.  We will be able to make this determination once we have all of the information back from the second phase of exploration.  Management and the new VP of Exploration will review the information from phase 2 and decide whether or not to continue exploration.  If the decision is to continue, we will begin the third phase of exploration.  In this phase, if sufficient funds can be generated to pay for the drilling, and assuming drill rigs are available in the area, our plan would be to commence this program in June 2007, and it would last approximately 60 days.  The results of this drill program would take approximately 90 days to be assayed and interpreted.  Once those result are known, we would consult with our lead exploration geologists and our new VP of Exploration to determine whether to abandon the Guazapares Property or continue with further drilling exploration.  If management decides to continue with further drilling, we would need to raise additional funding through the sale of debt or equity because we do not have sufficient capital to continue an exploration program.  Additional drilling would cost a significant amount of money, and there is no assurance that we would be able to raise such additional amounts of money.  We have not identified any sources of funds to implement such a program.  If we could not obtain additional financing, we could seek a joint venture partner if the results warranted it.  We do not have any joint venture partners at this time and can give no assurance that we would be able to find one if the Guazapares Property warranted such a joint venture.  The Guazapares Property is without known reserves. Our proposed programs are exploratory in nature.  Encino Gordo  The Encino Gordo Property comprises four mining concessions that total 1,042 hectares (approximately 2,575 acres). We have limited information available to us about this property from previous  - 29 -     exploration that was done by other companies.  The previous geochemical sampling that was done suggests a presence of mineralized structures. These structures are being investigated by geochemical sampling to determine if further exploration is warranted and to help refine the best exploration plan for the concessions.  1. Phase 1 Exploration.  Budget: We have planned for an exploration program, budgeted at approximately $200,000 from general working capital through April 2007, on our Encino Gordo Property.  Of this, $50,000 will be used for mapping and sampling, which we anticipate completing by February 2007.  The funds will be spent as directed by our VP Exploration.  The funds will come from general working capital.  Milestones: The goals of the first phase of exploration are to complete mapping of the property and to take geochemical samples from the property.  We currently have one geologist taking geochemical sampling and mapping this property.   The purpose of this initial program is to get a better understanding of the geology of the property.  We expect to complete this phase of the exploration program by the end of February 2007.  We intend to map the property at a scale of 1:5,000 with individual veins being mapped at a scale of 1:1,000 by the end of October 2006.  We have conducted sampling on the property.  A total of 43 stream sediment samples were collected from the various arroyos cutting the property. Samples of greater than 1 kilogram were collected with material crushed to less than 1 mm size.  Samples of this rock will be analyzed by Chemex ALS for gold content plus 27 other mineral elements associated with the rock.The sampling protocol followed the best mining practices. The purpose of the sampling was to further define the ore grade and potential of the property.  To date, three samples returned anomalous results of gold which require follow-up to verify source areas.  We would expect the balance of the samples to be returned by the end of February 2007.  We plan to prepare a list of preliminary drill hole locations to accompany the SAMARNAT work permit application. We intend to file the application for the permit by the end of February 2007, with approval from SAMARNAT expected by the end of April 2007.  Once the work permit is approved, our goal will be to drill the targets as recommended by our VP of Exploration.  We cannot predict with any accuracy when, if ever, we will commence drilling on this property and the cost of such drilling.  We plan to apply for drill permits before determining whether or not a drill program will be commenced in order to save time in the event a drill program is recommended.  Much additional exploration work must be completed and a definitive exploration plan needs to be prepared by our VP of Exploration before management can determine whether or not to continue to the next phase of exploration.  The actual drill hole locations are likely to change from those submitted with the working plan permit as drill targets are reviewed.  This change of targets will not affect the working permit as such a movement of locations is anticipated in the issuing of the permits.  Our goal is to have this further exploration completed by the end of February 2007, and a geological report prepared by our senior geologist on the Encino Gordo Property should be available 60 days thereafter.  Depending on the results of the report, as determined by management, we intend to either abandon the Encino Gordo Property, in which case no further payments would be made or would be due under our agreements to acquire these concessions, or to make additional expenditures to determine potential drill targets.  2. Phase 2 Drill Program.  Budget: If management decides to continue exploration by initiating a drill program, a budget will  - 30 -     be prepared at that time, and the amount and source of the capital needed for additional expenditures will be determined.  If a drill program of any size is recommended, we do not have sufficient capital on hand to complete such a program because it would most likely require the expenditure of significant amounts of money.  We would need to raise additional capital through the sale of debt or equity.  We can give no assurance that we would be able to raise such capital, as we have not identified any source of capital for such a program at this time.  If we could not raise additional funds, we would consider seeking a joint venture partner if the results warranted it.  We do not have any joint venture partners at this time and can give no assurance that we would be able to find one if the Encino Gordo Property warranted such a joint venture.  Milestones: The second phase of exploration would be a drill program to gather more information.  Such information would be used to determine if we should put the property into production.  We do not know when this phase of exploration could be completed, as discussed above.  We estimate that the program would take approximately 60 days to complete, with results from the program being returned about 90 days after completion.  These are estimates, as the number of drill targets will determine the length of the drill program.  Once the results from the drill program are known, we would consult with our lead exploration geologists and our new VP of Exploration to determine whether to abandon the Encino Gordo Property or continue with further drilling exploration.  Management and the VP of Exploration will review the information provided by the first phase of exploration and determine whether a drill program is recommended.  If a drill program is recommended and we have received our permits that have been applied for in advance, we do not have sufficient information at this time to estimate what that program would entail.  We need extensive information to determine the number of drill holes to drill, where they would be located and to what depth they would be drilled.  This information will be provided by the first phase of exploration.  The Encino Gordo Property is without known reserves. Our proposed programs are exploratory in nature.   Although three of our properties have been mined in the past, we are presently in the exploration stage and there is no assurance that a commercially viable mineral deposit exists in any of our properties.  We do not have any proven or probable reserves on our properties.  We have made a business decision to place a higher priority on the Cieneguita exploration program to define mineralized ore.  However, we intend to proceed with exploration on all three properties simultaneously.  If our exploration programs warrant drilling programs on the properties, we anticipate contracting two geologists and four assistants for supervising the drilling work and taking splits for the drilling samples.  Once we receive results from these exploration programs, our management will assess whether to proceed to any further exploration phases. In making this determination, we will make an assessment as to whether the results are sufficiently positive to enable us to obtain the financing necessary to proceed.  The decision will be based mainly on the recommendations of our senior geologist and VP of Exploration.  Other factors that will influence the production decision will be the current price of gold bullion, availability of mining equipment and a mining feasibility study.  Results of Operations  Three months ended May 31, 2006 compared to the three months ended May 31, 2005.  Revenues   - 31 -     We did not earn revenues during the three months ended May 31, 2006 or 2005 because we did not have commercial production of any of our properties. We do not anticipate earning revenues until such time as we have entered into commercial production of our mineral properties, if ever. We are presently in the exploration stage of our business.  We can provide no assurance that we will discover commercially exploitable levels of mineral resources on our properties or, if such resources are discovered, that we will enter into commercial production of our mineral properties. Interest income is recorded under Other Income in the Statement of Operations in the financial statements.  Operating Costs  We did not incur any operating costs during the years ended 2006 and 2005 due to the fact that we did not achieve production from exploration activities during either year.  Expenses  Our expenses increased to $822,549 for the three months ended May 31, 2006 compared to $13,052 for the three months ended May 31, 2005, representing an increase of $809,497. The increase is primarily attributable to the costs associated to raising capital and a developing exploration program which commenced in the prior fiscal quarter.  General and administrative cash expenses increased to $570,288 in the three months ended May 31, 2006 compared to $13,052 in the three months ended May 31, 2005, representing an increase of $557,236. Management fees increased to $88,045 in the three months ended May 31, 2006 from $nil in the three months ended May 31, 2005. The increase was attributable to a new management team appointed in the prior fiscal quarter. Finders fees increased to $284,950 in the three months ended May 31, 2006 from $nil in the three months ended May 31, 2005. The increase was attributable to two private placements; a unit offering and convertible debentures. Accounting and legal fees increased to $41,312 in the three months ended May 31, 2006 from $8,000 in the three months ended May 31, 2005. The increase in fees was primarily attributable to higher auditing costs and the cost of regulatory filings with the SEC.  There were no stock-based compensation expenses or other compensation expenses in either of the three month periods ended May 31, 2006 and 2005.  Mineral exploration in the three months ended May 31, 2006 increased to $252,261 compared to $nil for the three months ended May 31, 2005. The Company was not in a developing exploration program during the three months ended May 31, 2005. We anticipate that exploration expenditures will increase in fiscal 2007 as a result of exploration activities on our Mexican mineral properties.  Acquisition of resource properties was $nil for both three months ended May 31, 2006 and 2005.  Loss  Our net loss increased to $3,114,676 for the three months ended May 31, 2006 compared to $14,342 for the three months ended May 31, 2005, representing an increase of $3,100,334. This increase in our loss was primarily attributable to a beneficial conversion feature of $2,265,500 on convertible debentures issued in the three months ended May 31, 2006; which was recorded as interest expense.  We anticipate that we will continue to incur losses until such time as we can commence the development stage of our operations and achieve significant revenues from sales of gold recovered from our Mexican mineral properties. There is no assurance that we will be able to commence the development stage of our operations at any of our Mexican mineral properties or achieve revenues.     - 32 -     Liquidity and Capital Resources  Since inception, we have undergone two unsuccessful business combinations, which have caused us to incur significant liabilities and have resulted in the accumulation of a substantial deficit during the exploration stage.  As of May 31, 2006, we have total assets of $2,150,308, total liabilities of $3,004,277, and a deficit of $33,553,799 accumulated during the exploration stage.  Cash and Working Capital  We had cash of $2,074,857 as of May 31, 2006, compared to cash of $479,950 as of February 28, 2006, and $9,950 as of May 31, 2005. We had working capital of $2,060,806 as of May 31, 2006, compared to working capital of $45,944 as of February 28, 2006, and a working capital deficiency of $736,459 as of May 31, 2005.  Under our current business plan, we will not require additional financing this fiscal year.  However, we will require additional financing during the current fiscal year if our planned exploration activities increase. We plan to spend approximately $850,000 in the next twelve months to carry out exploration and administration activities on our Mexican mineral properties, and in the event that our exploration is successful on our Cieneguita Property, we anticipate spending a further $1,500,000 on equipment and building a plant to put that property into production. We anticipate spending approximately $480,000 during the next twelve months on general and administrative costs. We presently do not have sufficient financing to enable us to complete these plans and will require additional financing to perform future exploration work on our Mexican mineral properties. Our actual expenditures on these activities will depend on the amount of funds we have available as a result of our financing efforts. There is no assurance that we will be able to raise the necessary financing.  Cash Used in Operating Activities  Cash used in operating activities increased to $873,211 for the three months ended May 31, 2006 compared to $10,172 for the three months ended May 31, 2005. The cash used in operating activities came primarily from convertible debt and equity sales of our common shares. It was primarily used for General and Administrative costs and for the acquisition of resource properties.  Investing Activities  Cash used in investing activities increased to $1,962 for the three months ended May 31, 2006 compared to $nil for the three months ended May 31, 2005. Cash used in investing activities was used to acquire office equipment for our office in Mexico.  Financing Activities  Cash provided by financing activities increased to $2,470,500 for the three months ended May 31, 2006 compared to cash used of $15,000 for the three months ended May 31, 2005. All cash provided by financing activities was provided by convertible debt and share issuances. Cash provided by financing activities was used to fund our operating and investing activities.  We anticipate continuing to rely on equity sales of our common stock or issuance of debt in order to continue to fund our business operations. Issuances of additional shares will result in dilution to our existing shareholders.  On April 3, 2006 and May 31, 2006, the Company issued 550,000 common shares and 200,000 common shares respectively and closed a private placement for total proceeds of $375,000.  As at February 28, 2006, the Company had received $170,000 of subscriptions for this unit offering. Units consisted of one share of common stock and one-half of one warrant.  Each full warrant entitles the investor to purchase an additional  - 33 -     share of the Companys common stock at a price of $1.00 per share and is exercisable until April 30, 2008. The units were priced at $0.50 each.  On March 4, 2006, the Company agreed to issue 1,651,200 common shares at a price of $0.25 per share to settle $412,800 in promissory notes payable. As a condition, the promissory note holders waived all accrued interest payable on the notes. On April 6, 2006, these shares were issued and the Company recorded a $7,259 gain on settlement of debt.  During the quarter ended May 31, 2006, the Company issued a total of $2,265,500 convertible debentures. The convertible debentures, with principal and accrued interest at 7% per year are convertible into units at the option of the holder.  Each unit consists of a warrant to purchase 25,000 of the Companys common shares at $1.00 and $25,000 of debt, which may be converted to common shares at $0.50 per share and is exercisable until April 30, 2008.  In addition, the warrants are redeemable by the Company, at $.01 per share, in the event the Companys Common Stock closes with a bid price, on average, over $3.00 per share for a consecutive 20-day period. There were no convertible debentures issued on the three months ended May 31, 2005.  The amount of our convertible debt outstanding at May 31, 2006 was $2,917,500 compared to $652,000 at February 28, 2006 and $705,000 at May 31, 2005.  In June 2006, all of the holders of the $2,917,500 convertible debentures converted to common shares at $0.50 per share.  The Company issued 5,835,000 common shares and 2,917,500 warrants to debenture holders upon the conversion. We have paid to the convertible debenture holders a total of $58,817, which is their accumulated interest on the debentures.  We believe that the cash on hand derived from the sale of securities totaling $3,292,500 will be sufficient to fund our budgeted exploration and operation costs until April 2007.  Going Concern  Our financial statements have been prepared on a going concern basis, which assumes the realization of assets and settlement of liabilities in the normal course of business. Our ability to continue as a going concern is dependent upon our ability to generate profitable operations in the future and/ or to obtain the necessary financing to meet our obligations and repay our liabilities arising from normal business operations when they become due. The outcome of these matters cannot be predicted with any certainty at this time and raise substantial doubt that we will be able to continue as a going concern. Our financial statements do not include any adjustments to the amount and classification of assets and liabilities that may be necessary should we be unable to continue as a going concern.  The Company has a history of operating losses and will need to raise additional capital to fund its planned operations. The Company had working capital of $2,060,806 as of May 31, 2006, and an accumulated deficit of $35,557,226.  These conditions raise substantial doubt about the Companys ability to continue as a going concern.  The Company intends to reduce its cumulative loss through the attainment of profitable operations from its investment in a Mexican mining venture. There is no assurance that these operations will be profitable.  In addition, the Company has conducted private placements of convertible debt and common stock, which have generated a portion of the initial cash requirements of its planned Mexican mining ventures.   Off-Balance Sheet Arrangements  We currently do not have any off-balance sheet arrangements which have or are reasonably likely to have a current or future effect on our financial condition, changes in financial condition, revenues or expenses, results  - 34 -     of operations, liquidity, capital expenditures or capital resources that are material to our investors.       ITEM 3. CONTROLS AND PROCEDURES  The Securities and Exchange Commission defines the term disclosure controls and procedures to mean a company's controls and other procedures of an issuer that are designed to ensure that information required to be disclosed in the reports that it files or submits under the Securities Exchange Act of 1934 is recorded, processed, summarized and reported, within the time periods specified in the Securities and Exchange Commissions rules and forms. Disclosure controls and procedures include, without limitation, controls and procedures designed to ensure that information required to be disclosed by an issuer in the reports that it files or submits under the Securities Exchange Act of 1934 is accumulated and communicated to the issuers management, including its principal executive and principal financial officers, or persons performing similar functions, as appropriate to allow timely decisions regarding required disclosure.  The Company maintains such a system of controls and procedures in an effort to ensure that all information which it is required to disclose in the reports it files under the Securities Exchange Act of 1934 is recorded, processed, summarized and reported within the time periods specified under the SEC's rules and forms and that information required to be disclosed is accumulated and communicated to principal executive and principal financial officers to allow timely decisions regarding disclosure.  As of the end of the period covered by this report, we carried out an evaluation, under the supervision and with the participation of our chief executive officer and principal accounting officer, of the effectiveness of the design and operation of our disclosure controls and procedures.  Based on this evaluation, our chief executive officer and principal accounting officer concluded that our disclosure controls and procedures are designed to provide reasonable assurance of achieving the objectives of timely alerting them to material information required to be included in our periodic SEC reports and of ensuring that such information is recorded, processed, summarized and reported with the time periods specified.  Our chief executive office and principal accounting officer also concluded that our disclosure controls and procedures were effective as of May 31, 2006 to provide reasonable assurance of the achievement of these objectives.  There were no changes in our internal controls or in other factors that could affect these controls subsequent to the date of their evaluation, including any deficiencies or material weaknesses of internal controls that would require corrective action.  After completing our evaluation, we received comments from the SEC staff in relation to our Registration Statement on Form SB-2.  After considering the staffs comments, our management concluded that we needed to restate certain of our financial statements to correct a calculation error in the recording of a beneficial conversion feature on warrants issued with convertible debentures, to reclassify accrued interest, and to correct an error in valuing the common stock issued by the Company.  Such restatements are described in more detail in Note 2 to our Financial Statements included in our Amended Annual Report on Form 10-KSB/A for the fiscal year ending February 28, 2006 and Amended Quarterly Report on Form 10-QSB/A for the quarter ended May 31, 2006.  Based on the foregoing, our principal executive officer and principal financial officer reviewed and reevaluated the effectiveness of our disclosure controls and procedures as of the end of the period covered by this report to ensure that information required to be disclosed by us in the reports that we file or submit under the Securities Exchange Act of 1934 is recorded processed, summarized and reported within the time periods specified by the SEC.  Our principal executive officer and our principal financial officer determined that our disclosure controls and procedures were not effective at the reasonable assurance level as of the end of the period covered by this report.  The errors which occured were due to a lack of knowledge of GAAP requirements.  Our principal financial officer now has knowledge of the treatment of these items under GAAP.   - 35 -      PART II - OTHER INFORMATION  ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS.  In the quarter ended May 31, 2006, the Company issued $2,265,500 of convertible debentures, with principal  and accrued interest at 7% per year, convertible into units at the option of the holder. Each unit consists of a warrant to purchase 25,000 common shares at $1.00 per share and $25,000 of debt, which may be converted to common shares at $0.50 per share and is exercisable until April 30, 2008. These warrants are redeemable by the Company, at $0.01 per share, in the event the Companys Common Stock closes with a bid price, on average, over $3.00 per share for a consecutive 20 day period.  The units were offered and sold to the Purchasers in a private placement transaction made in reliance upon exemptions from registration pursuant to Regulation S for offerings outside of the United States.  The units were not offered or sold to United States citizens, and no directed selling efforts were made within the United States.  During the quarter ended May 31, 2006, the Company issued 750,000 common shares pursuant to a private placement unit offering. Units consisted of one share of common stock and one-half of one warrant. Each full warrant entitles the investor to purchase an additional share of the Companys common stock at a price of $1.00 per share and is exercisable until April 30, 2008.  These units were only offered to individuals or entities who qualified as accredited investors under the Securities Act of 1933.  The units were offered under an exemption from registration found in Rule 506 of Regulation D.  On March 4, 2006, the Company agreed to issue 1,651,200 common shares at a price of $0.25 per share to settle $412,800 in promissory notes payable and on April 6, 2006, these shares were issued.    ITEM 6. EXHIBITS.  The following exhibits are filed in reference:   Exhibit
NumberDescription3.1Articles of Incorporation, as amended on December 10, 2001 and February 13, 2006 (Herein incorporated by reference from the Registration Statement on Form SB-2 filed with the Securities and Exchange Commission on April 7, 2006).3.2Bylaws of the Corporation (Herein incorporated by reference from the Registration Statement on Form SB-2/A filed with the Securities and Exchange Commission on September 25, 2006.)4.1Registration Agreement dated April 20, 2004, by and among Sunburst Acquisitions IV, Inc., a Colorado company, and each of the purchasers in a private placement of shares of Sunburst (Herein incorporated by reference from the Registration Statement on Form SB-2/A filed with the Securities and Exchange Commission on September 25, 2006.)  - 36 -      4.2Promissory Note between Sunburst Acquisitions IV, Inc. and Minera Rio Tinto S.A. de C.V. in the amount of $ 57,500 dated January 9, 2004 (incorporated by reference from Current Report on Form 8-K filed with the Securities and Exchange Commission on June 3, 2004).4.3Promissory Note between Sierra Mineral and Mining, Inc. and Minera Rio Tinto S.A. de C.V. in the amount of $ 167,500, dated May 3, 2004 (incorporated by reference from Current Report on Form 8-K filed with the Securities and Exchange Commission on June 3, 2004).4.4Securities Purchase Agreement with exhibits entered in connection with the $1,350,000 original issued discount secured convertible debenture financing dated August 25, 2004 (Herein incorporated by reference from the Registration Statement on Form SB-2/A filed with the Securities and Exchange Commission on September 25, 2006.)4.5Secured Convertible Debenture by and between Bristol Capital, LLC and Sunburst Acquisitions IV, Inc. dated January 15, 2004 (Herein incorporated by reference from the Registration Statement on Form SB-2/A filed with the Securities and Exchange Commission on July 10, 2006).4.6Transaction Fee Agreement dated April 22, 2004 between Sunburst Acquisitions IV Inc. and T.R. Winston & Company LLC ( Herein incorporated by reference from the Registration Statement on Form SB-2 filed with the Securities and Exchange Commission on April 7, 2006).4.7Finders Fee Agreement dated 2004 between Sunburst Acquisitions IV, Inc. and Liberty Management, LLC (Herein incorporated by reference from the Registration Statement on Form SB-2/A filed with the Securities and Exchange Commission on September 25, 2006.)4.8Convertible Debenture template used to sell debentures and units of Mexoro Minerals Ltd. for the offering that occurred in January through May of 2006 (Herein incorporated by reference from the Registration Statement on Form SB-2 filed with the Securities and Exchange Commission on April 7, 2006).4.9Stock option plan approved by the shareholders of Mexoro Minerals, Ltd. on February 13, 2006. (Herein incorporated by reference from the Registration Statement on Form SB-2 filed with the Securities and Exchange Commission on April 7, 2006).4.10Subscription Agreement template used to sell units of Mexoro Minerals Ltd. for the offering that occurred in February and March of 2006 and was offered to accredited investors under Regulation D (Herein incorporated by reference from the Registration Statement on Form SB-2/A filed with the Securities and Exchange Commission on September 25, 2006.)4.11Convertible Debentures issued December 8, 2005 to Daimler Capital, James Longshore, and Spectrum International in the amount of $300,000 (Herein incorporated by reference from the Registration Statement on Form SB-2/A filed with the Securities and Exchange Commission on September 25, 2006.)10.1Share Exchange Agreement, dated May 3, 2004, by and among Sunburst Acquisitions IV, Inc., a Colorado corporation, Sierra Minerals and Mining, Inc., a Nevada corporation, and the shareholders of Sierra Minerals & Mining, Inc. (Herein incorporated by reference from the Registration Statement on Form SB-2/A filed with the Securities and Exchange Commission on September 25, 2006.)  - 37 -      10.2Joint Venture Agreement, dated April 26, 2004 and amended on June 1, 2004, by and between Sierra Mining and Minerals, Inc., a Nevada corporation, and Minera Rio Tinto S.A. de C.V., a Mexican company (Herein incorporated by reference from the Registration Statement on Form SB-2/A filed with the Securities and Exchange Commission on September 25, 2006.)10.3Amendment to Joint Venture Agreement dated June 1, 2004. (Herein incorporated by reference from the Registration Statement on Form SB-2/A filed with the Securities and Exchange Commission on September 25, 2006.)10.4SHARE OPTION AGREEMENT among Minera Rio Tinto, S.A. de C.V. a corporation duly incorporated and validly existing pursuant to the laws of the United Mexican States and having an office at Pascual Orozco No. 2117 - A Chihuahua, State of Chihuahua, Mexico 31310 and Sunburst Acquisitions IV, Inc., a corporation duly incorporated and validly existing pursuant to the laws of the State of Colorado, USA and having an office at Suite 206, 595 Howe St., Vancouver, B.C. Canada V6C 2T5 (Herein incorporated by reference from the Registration Statement on Form SB-2/A filed with the Securities and Exchange Commission on September 25, 2006.)10.5AGREEMENT made and entered in the City of Chihuahua, State of Chihuahua as of the 18th day of August, 2005 among COMPAÑÍA MINERA DE NAMIQUIPA, S. A. DE C. V. a company duly incorporated and validly existing pursuant to the laws of the United Mexican States, and MINERA RIO TINTO, S. A. DE C. V. a company duly incorporated and validly existing pursuant to the laws of the United Mexican States, and MARIO HUMBERTO AYUB TOUCHE having a domicile at San Antonio No. 2036 Chihuahua, Chihuahua and SUNBURST MINING DE MÉXICO, S. A. DE C. V., a company duly incorporated and validly existing pursuant to the laws of the United Mexican States  (herein incorporated by reference from the Companys report on Form 8-K for report date August 22, 2005 and filed with the Securities and Exchange Commission on August 25, 2005).10.6AGREEMENT made and entered at the City of Chihuahua, State of Chihuahua on this the 18th day of August of the year 2005, among MINERA RIO TINTO, S. A. DE C. V. a company duly incorporated and validly existing pursuant to the laws of the United Mexican States, and SUNBURST MINING DE MÉXICO, S. A. DE C. V. a company duly incorporated and validly existing pursuant to the laws of the United Mexican States (Encino Gordo) (Herein incorporated by reference from the Registration Statement on Form SB-2/A filed with the Securities and Exchange Commission on September 25, 2006.)10.7OPERATORS AGREEMENT dated effective as of the 18th day of August, 2005, among Minera Rio Tinto, S.A. de C.V. a corporation duly incorporated and validly existing pursuant to the laws of the United Mexican States and having an office at Pascual Orozco No. 2117 - A Chihuahua, State of Chihuahua, Mexico 31310, and Sunburst de Mexico, S.A. de C.V. a corporation duly incorporated and validly existing pursuant to the laws of the United Mexican States and having an office at Suite 5, Avenida del Mar No.1022 Zona Costera, Mazatlan, State of Sinaloa, Mexico (Herein incorporated by reference from the Registration Statement on Form SB-2/A filed with the Securities and Exchange Commission on September 25, 2006.)  - 38 -      10.8ASSIGNMENT OF CONTRACT AGREEMENT made and entered in the City of Chihuahua, State of Chihuahua as of this the 18th day of August, 2005 among MINERA RIO TINTO, S. A. DE C. V. a company duly incorporated and validly existing pursuant to the laws of the United Mexican States, and CORPORATIVO MINERO, S.A. DE C.V. a company duly incorporated and validly existing pursuant to the laws of the United Mexican States, and SUNBURST MINING DE MÉXICO, S. A. DE C. V. a company duly incorporated and validly existing pursuant to the laws of the United Mexican States (herein incorporated by reference from the Companys report on Form 8-K for report date August 22, 2005 and filed with the Securities and Exchange Commission on August 25, 2005).10.9ASSIGNMENT OF CONTRACT AGREEMENT made and entered in the City of Chihuahua, State of Chihuahua as of this the 18th day of August, 2005, among MINERA RIO TINTO, S. A. DE C. V. a company duly incorporated and validly existing pursuant to the laws of the United Mexican States, and RAFAEL FERNANDO ASTORGA HERNÁNDEZ, having a domicile at Calle República de Uruguay No. 706 of the City of Chihuahua, Chih, and SUNBURST MINING DE MÉXICO, S. A. DE C. V. a company duly incorporated and validly existing pursuant to the laws of the United Mexican States (San Antonio) (herein incorporated by reference from the Companys report on Form 8-K for report date August 22, 2005 and filed with the Securities and Exchange Commission on August 25, 2005).10.10ASSIGNMENT OF CONTRACT AGREEMENT made and entered in the City of Chihuahua, State of Chihuahua as of this the 18th day of August, 2005 among MINERA RIO TINTO, S. A. DE C. V. a company duly incorporated and validly existing pursuant to the laws of the United Mexican States, having an office at Av. Pascual Orozco Number 2117- Altos, La Cima, C. P. 31310, Chihuahua, Chihuahua, and MINERA RACHASA, S.A. DE C.V., a company duly incorporated and validly existing pursuant to the laws of the United Mexican States, and having an office at Niños Héroes No. 410 Colonia Centro, Chihuahua, Chihuahua (RFC BMM-900120-8B6), and SUNBURST MINING DE MÉXICO, S. A. DE C. V. a company duly incorporated and validly existing pursuant to the laws of the United Mexican States (San Francisco) (herein incorporated by reference from the Companys report on Form 8-K for report date August 22, 2005 and filed with the Securities and Exchange Commission on August 25, 2005).10.11THE NEW AGREEMENT entered into on December 8, 2005 among the Company, Sunburst de Mexico, and MRT (herein incorporated by reference from the Companys current report on Form 8-K for report date December 8, 2005 and filed with the Securities and Exchange Commission on December 14, 2005).10.12Funds Escrow Agreement dated July 2005, among Sunburst Acquisitions IV, Inc., Investment Fund, Ltd., Alpha Capital AG and Stonestreet LP, and Grushko & Mittman, P.C. (herein incorporated by reference from the Companys current report on Form 8-K dated July 1, 2005 and filed with the Securities and Exchange Commission on August 17, 2005).10.13Repayment Agreement dated July 15, 2005 by and among Sunburst IV, Inc. and Investment Fund, Ltd., Alpha Capital AG and Stonestreet LP. (herein incorporated by reference from the Companys current report on Form 8-K dated July 1, 2005 and filed with the Securities and Exchange Commission on August 17, 2005).  - 39 -      10.14Consulting Agreement dated July 1, 2005 between Tracy A. Moore and Sunburst Acquisitions IV, Inc. (herein incorporated by reference from the Companys current report on Form 8-K dated July 1, 2005 and filed with the Securities and Exchange Commission on August 17, 2005).10.15Consulting Agreement with G.M. Capital Partners, Ltd. dated January 30, 2006 (incorporated by reference from Current Report on Form 8-K filed with the Securities and Exchange Commission on February 7, 2006).10.17Amendment to the New Agreement, dated April 6, 2006 by and among Mexoro Minerals, Ltd., Sunburst Mining de Mexico S.A. de C.V., and Minera Rio Tinto, S.A. de C.V. (Herein incorporated by reference from the Registration Statement on Form SB-2/A filed with the Securities and Exchange Commission on September 25, 2006.)10.18Addendum To Purchase Contract Of Mining Rights To Lump Sum Entered Into On May 6, 2004 by Corporativo Minero, S.A. De C.V. And Sunburst Mining De Mexico, S.A. De C.V., dated March 24, 2006 (Herein incorporated by reference from the Registration Statement on Form SB-2/A filed with the Securities and Exchange Commission on September 25, 2006.)10.22Original Agreement between MRT and Corportivo Minero dated 2004 concerning the Cieneguita property (herein incorporated by reference from the Registration Statement on Form SB-2/A filed with the Securities and Exchange Commission on December 18, 2006.)10.23Agreement between MRT and La Empresa Denominada Minera Rachasa dated 2004 concerning the San Francisco concessions (Herein incorporated by reference from the Registration Statement on Form SB-2/A filed with the Securities and Exchange Commission on September 25, 2006.)31.1Certification of Chief Executive Officer of Mexoro Minerals Ltd. pursuant to Rule 13a-14(a)/15d-14(a). *31.2Certification of Chief Financial Officer of Mexoro Minerals Ltd.  pursuant to Rule 13a-14(a)/15d-14(a). *32.1Certification of Chief Executive Officer of Mexoro Minerals Ltd. pursuant to 18 U.S.C. Section 1350. *32.2Certification of Chief Financial Officer of Mexoro Minerals Ltd.  pursuant to 18 U.S.C. Section 1350. *  *filed herewith    SIGNATURE  In accordance with the requirements of the Exchange Act, the registrant caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.   MEXORO MINERALS LTD.    - 40 -       By: /S/ Robert Knight Robert Knight,




CEO

 and Director  Date:

 April 4, 2007  - 41 -