Exhibit 10.5
PERSONAL AND
CONFIDENTIAL
March 17, 2009
Mexoro Minerals Ltd. and Sunburst de
Mexico S.A. de C.V.
C.
General Retana #706
Col. San Felipe
Chihuahua, Mexico 31203
Dear Sirs:
Re:
Indebtedness of Mexoro
Minerals Ltd. (“ Mexoro ”) as guaranteed by
Sunburst de Mexico S.A. de C.V. (“ Sunburst ”)
to Paramount Gold and Silver Corp. (“ Paramount
”)
A.
Pursuant to three
debentures between Paramount and Mexoro, (together, the “
Debentures ”), Paramount has made available to Mexoro
the following credit facilities:
a.
Secured Convertible
Debenture dated May 9, 2008 in the principal amount of
$500,000.00 which bears interest at the rate of 8% per annum (the
“ First Debenture ”);
b.
Secured Convertible
Debenture dated June 18, 2008 in the principal amount of
$370,000.00 which bears interest at the rate of 8% per annum (the
“ Second Debenture ”); and
c.
Secured Convertible
Debenture dated July 11, 2008 in the principal amount of
$500,000.00 which bears interest at the rate of 8% per annum (the
“ Third Debenture ”).
B.
The Debentures were
secured by:
d.
Security Agreement dated
as of May 9, 2008 between Mexoro and Paramount granting
Paramount a continuing security interest in all personal property
and fixtures and interests of Mexoro as amended by an Addendum
dated June 18, 2008 (collectively, the “ Security
Agreement ”);
e.
Asuncion Unilateral de
Obligacion Solidarida y constitucion de Hipoteca Industrial,
content on the Public Document number 24,872, notarized with
FRANCISCO GARCIA RAMOS, Public Notary Number 9, Chihuahua City,
Chihuahua State, Mexico, due on May 9th, 2008 and recorded at
the Public Register of Commerce of Chihuahua, at the Mercantile
Page (folio mercantile) number 24,401*10, 10M21, registered on
July 11th, 2008, and page (foja) 197, book 68, on
July 15 2008, at the Commerce Section, and at the Mining
Recorders Office of the General Direction of Mines of the Federal
Secretariat of Economy of the Federal Government at the Book number
129, Vol. 24, Act 38, Page (folio) 23, on July 28, 2008
(“ First Sunburst Security Agreement and
Guarantee ”); and
f.
Asuncion Unilateral de
Obligacion Solidarida y constitucion de Hipoteca Industrial,
content on the Public Document number 25,163, notarized with
FRANCISCO GARCIA RAMOS, Public Notary Number 9, Chihuahua City,
Chihuahua State, Mexico, due on August 12th, 2008. Recorded at
the Public Register of Commerce of Chihuahua, at the Mercantile
Page (folio mercantile) number 24,401*10, 10M21, registered on
August 20, 2008, and page (foja) 170, book 70, on
August 25, 2008, at the Commerce Section, and at the Mining
Recorders Office of the General Direction of Mines of the Federal
Secretariat of Economy of the Federal Government at the Book number
129, Vol. 24, Act 133, Page (folio) 78, on August 29, 2008
(“ Second Sunburst Security Agreement and Guarantee
”).
C.
Mexoro has requested
that Paramount forbear from enforcing its rights and remedies at
this time.
D.
In consideration of
Paramount’s forbearance as described in this agreement (the
“ Agreement ”) and the other accommodations
described in this Agreement and for other good and valuable
consideration, the receipt and sufficiency of which are irrevocably
acknowledged by Mexoro and Sunburst, Mexoro and Sunburst agree with
Paramount as follows:
Acknowledgement
2.
The parties acknowledge
that, unless otherwise specified, all capitalized terms contained
in this Agreement have the same meaning as in the Debentures and
all monetary amounts are expressed in United States dollars unless
otherwise expressly provided herein.
3.
Mexoro and Sunburst
acknowledge that Mexoro is indebted to Paramount under the
Debentures in the amounts specified in paragraph A of this letter
as at the date specified therein, together with interest and costs
to the date of payment. Mexoro also acknowledges that the interest
rate applicable thereto is as specified in paragraph A in this
Agreement.
4.
Against the delivery of
the documents in Paragraph 6, Mexoro will deliver to Paramount
within 3 business days of signing this agreement at the offices of
Paramount’s solicitors, Gowling Lafleur Henderson LLP, 160
Elgin Street, Ottawa, Ontario:
a.
$1,000,000.00 in
certified funds in payment of the aggregate principal outstanding
under the First Debenture and the Third Debenture;
b.
an amending agreement
with respect to the Second Debenture in the principal amount of
$370,000.00 (the “ Amended Second Debenture ”),
in a form acceptable to al
