NONQUALIFIED STOCK OPTION
AGREEMENT
This Nonqualified Stock Option Agreement, dated
September 21, 2009 (the “Agreement”), between
Mexoro Minerals Ltd., a Colorado corporation (the
“Company”), with its principal office at C. General
Retana #706, Col. San Felipe, Chihuahua, Chihuahua, 31203, Mexico,
and George Young (“Optionee”).
1. Grant of Option . The Company
hereby grants to Optionee effective as of September 21, 2009
(“Grant Date”), the right and option
(“Option”) to purchase from the Company, for a price
equal to the exercise price determined as described below
(“Exercise Price”), up to 1,000,000 shares of the
Company’s common stock (“Shares”), as a
nonqualified stock option (“Option”), which Option
shall be subject to the applicable terms and conditions set forth
below and is being granted pursuant to the Mexoro Minerals Ltd.
2009 Nonqualified Stock Option Plan (“Plan”), which
Plan is part of the Mexoro Minerals Ltd. Stock Compensation Program
(“Program”).
2. Terms and Conditions of Option .
The Option evidenced by this Agreement is subject to the following
terms and conditions, as well as the terms and conditions of
Section 3 hereof.
a. Exercise
Price . The Exercise Price is $0.36 per Share, which is the
fair market value per Share on the Grant Date as determined in
accordance with the Plan.
b. Term of
Option . The term of the Option over which the Option may be
exercised shall commence on the Grant Date and, subject to the
provisions of Section 3(b) below, shall terminate ten years
thereafter.
c.
Exercisability of Option . As to the total number of Shares
with respect to which the Option is granted, the Option shall be
exercisable on the vesting date as follows: 250,000 shares will
vest and become exercisable on the 6th month anniversary of the
Grant Date, an additional 250,000 shares will vest and become
exercisable on the 12th month anniversary of the Grant Date, an
additional 250,000 shares will vest and become exercisable on the
18th month anniversary of the Grant Date and the remaining 250,000
shares will vest and become exercisable on the 24th month
anniversary of the Grant Date.
3.
Additional Terms and Conditions .
a. Exercise
of Option; Payments for Shares . An Option may be exercised
from time to time with respect to all or any portion of the number
of Shares with respect to which the Option has become exercisable,
in whole or in part, by written notice to the Company at the
Company’s then principal office, to the attention of the
Administrative Committee for the Mexoro Minerals Ltd. Nonqualified
Stock Option Plan (the “Committee”), substantially in
the form of Exhibit A attached hereto. Notwithstanding
anything in this Agreement to the contrary, no Option may be
exercised prior to the date on which the Plan is approved by the
Company’s shareholders. Any notice of exercise of the Option
shall be accompanied by payment of the full Exercise Price for the
Shares being purchased by certified or bank check payable to the
order of Mexoro Minerals Ltd. or, as may be allowed by the
Committee, by delivery to the Company of a number of Shares already
owned by Optionee having a fair market value equal to such Exercise
Price. In addition, with the consent of the Committee, the Company
may cooperate with Optionee in arranging a “cashless
exercise” of the Option through a broker approved by the
Committee. The Option shall not be exercised for any fractional
Shares and no fractional Shares shall be issued or delivered. The
date of actual receipt by the Company of the notice of exercise
shall be treated as the date of exercise of the Option for the
Shares being purchased.
b.
Termination of Option . If Optionee’s term with the
board of directors with the Company or any Subsidiary terminates,
the Option shall continue to be exercisable, to the extent it is
exercisable on the date such employment terminated, for three
(3) months after such termination, but in no event after the
date the Option otherwise terminates. However, if Optionee’s
employment terminates because of Optionee’s death or
disability, the Option shall continue to be exercisable, to the
extent it is exercisable on the date such employment terminated,
for twelve (12) months after such termination, but in no event
after the date the Option otherwise terminates.
c. Issuance
of Shares; Registration; Withholding Taxes . As soon as
practicable after the exercise date of the Option, the Company
shall cause to be issued and delivered to Optionee, or for the
Optionee’s account, a certificate or certificates for the
Option Shares purchased. The Company may postpone the issuance or
delivery of the Shares until (i) the completion of
registration or other qualification of such Shares or transaction
under any state or federal law, rule or regulation, or any listing
on any securities exchange, as the Company shall determine to be
necessary or desirable; (ii) the receipt by the Company of
such written representations or other documentation as the Company
deems necessary to establish compliance with all applicable laws,
rules and regulations, including applicable federal and state
securities laws and listing requirements, if any; and (
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