INDEMNIFICATION
AGREEMENT
This Indemnification Agreement, dated as of
September _, 2009, is made by and between Mexoro Minerals Ltd., a
Colorado corporation (the “ Company ”),
and
(the “ Indemnitee ”).
A. The Company and Indemnitee recognize the
difficulties associated with obtaining liability insurance for the
Company’s directors, officers, employees and other agents,
including the rising cost of such insurance and the general
reductions in the coverage of such insurance;
B. The Company and Indemnitee recognize the
substantial increase in corporate litigation in general, subjecting
directors, officers, employees and other agents to expensive
litigation risks at the same time as the availability and coverage
of liability insurance has been severely limited;
C. The Company desires to attract and
retain the services of talented and experienced individuals, such
as Indemnitee, to serve as directors, officers, employees and
agents of the Company and its subsidiaries and wishes to provide
the indemnification of, and the advancement of expenses to,
Indemnitee, its directors, officers, employees and other agents to
the maximum extent permitted by law;
D. The Company
will benefit from the service of the Indemnitee;
E. Article 7-109 of the Revised
Statutes of the State of Colorado, under which the Company is
organized (“ Article 7-109 ”),
empowers the Company to indemnify its directors, officers,
employees and agents by agreement and to indemnify persons who
serve, at the request of the Company, as the directors, officers,
employees or agents of other corporations or enterprises;
and
F. In order to induce Indemnitee to serve
or continue to serve as a director, officer, employee or agent of
the Company and/or one or more subsidiaries of the Company free
from undue concern for claims for damages arising out of or related
to such services to the Company and/or one or more subsidiaries of
the Company, the Company has determined and agreed to enter into
this Agreement with Indemnitee.
Accordingly,
the Company and Indemnitee agree as follows:
1. Certain Definitions . As used in
this Agreement:
(a) A “Change in Control” shall
be deemed to have occurred if, on or after the date of this
Agreement, (i) any “person” (as such term is used
in Sections 13(d) and 14(d) of the Securities Exchange Act of 1934,
as amended), other than a trustee or other fiduciary holding
securities under an employee benefit plan of the Company, is or
becomes the “beneficial owner” (as defined in Rule
13d-3 under such Act), directly or indirectly, of securities of the
Company representing 35% or more of the total voting power
represented by the Company’s then outstanding Voting
Securities, or (ii) during any period of two consecutive
years, individuals who at the beginning of that two-year period
constitute the Board of Directors of the Company and any new
director whose election by the Board of Directors or nomination for
election by the Company’s shareholders was approved by a vote
of at least a majority of the directors then still in office who
either were directors at the beginning of the two-year period or
whose election or nomination for election was previously so
approved, cease for any reason to constitute a majority of the
Board of Directors, or (iii) the shareholders of the Company
approve a merger or consolidation of the Company with any other
entity, other than a merger or consolidation which would result in
the Voting Securities of the Company outstanding immediately prior
thereto continuing to represent (either by remaining outstanding or
by being converted into Voting Securities of the surviving entity)
at least 50% of the total voting power represented by the Voting
Securities of the Company or such surviving entity outstanding
immediately after such merger or consolidation, or the shareholders
of the Company approve a plan of complete liquidation of the
Company or an agreement for the sale or disposition by the Company
in one transaction or a series of transactions of all or
substantially all the Company’s assets.
(b) “Charter Documents” means
the articles of incorporation of the Company and the bylaws of the
Company.
(c) “Claim” shall mean with
respect to an Indemnifiable Event (as defined below): any
threatened, pending or completed action, suit, proceeding or
alternative dispute resolution mechanism, or any hearing, inquiry
or investigation that leads to the institution of any such action,
suit, proceeding or alternative dispute resolution mechanism,
whether civil, criminal, administrative, investigative or
other.
(d) “Disinterested Director”
means a director of the Company who is not a party to a Proceeding
in respect of which indemnification or advancement of Expenses is
sought by Indemnitee.
(e) “Expenses” means all costs
and expenses, including attorneys’ fees, paid or incurred in
connection with investigating, defending, being a witness in or
participating in (including on appeal), or preparing for an
investigation or preparing to defend, be a witness in or
participate in any Proceeding relating to any Indemnifiable Event
and any federal, state, local or foreign taxes imposed as a result
of the actual or deemed receipt of any payments under the
Agreement.
(f) “Expense Advance” shall
mean a payment to Indemnitee pursuant to Section 3 of Expenses
in advance of the settlement of or final judgment in any Proceeding
or Claim.
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(g) “Indemnifiable Event” means
any event or occurrence related to the fact that Indemnitee is or
was a director, officer, employee, agent or fiduciary of the
Company, or any subsidiary of the Company, or is or was serving at
the request of the Company as a director, officer, partner,
manager, member, employee, trustee, agent or fiduciary of another
corporation, partnership, limited liability company, joint venture,
employee benefit plan, trust or other enterprise, or by reason of
anything done or not done by Indemnitee in any such
capacity.
(h) “Independent Counsel” means
an attorney or firm of attorneys, selected in accordance with the
provisions of Section 6(c), who shall not have otherwise
performed services for the Company or Indemnitee within the last
three years (other than with respect to matters concerning the
rights of indemnity under this Agreement, or of other indemnitees
under similar indemnification agreements or under the Charter
Documents).
(i) “Liabilities” means the
obligation incurred with respect to a Proceeding to pay any
judgment, settlement, penalty, fine or reasonable Expense,
including any excise taxes assessed with respect to any employee
benefit plan, and including all interest, assessments and other
charges paid or payable in connection with or in respect of any
such amounts.
(j) “Proceeding” means any
threatened, pending or completed action, suit or proceeding,
including any alternative dispute resolution mechanism, whether
civil, criminal, administrative or investigative, and whether
formal or informal.
(k) “Representation” shall mean
any officer, director, employee, manager, advisor, protector,
agent, grantor, trustee, affiliates or associates of an Indemnitee
or the Estate of an Indemnitee.
(l)
“Section” refers to a section of this Agreement unless
otherwise indicated.
(m) “Voting Securities” means
any securities of the Company which are entitled to vote generally
in the election of directors.
(a) The Company shall indemnify Indemnitee
to the fullest extent permitted by law against any and all
Liabilities and Expenses arising out of or in connection with any
Proceeding to which Indemnitee was, is or becomes a party, or is
threatened to be made a party, by reason of, or arising in whole or
part out of, an Indemnifiable Event.
(b) To the extent that Indemnitee has been
successful, on the merits or otherwise, including, without
limitation, the dismissal of an action without prejudice, in
defense of any Proceeding, Indemnitee shall be indemnified against
all Expenses incurred by Indemnitee in connection therewith. If
Indemnitee is successful, on the merits or otherwise, as to one or
more but less than all claims, issues or matters in any Proceeding,
the Company shall indemnify Indemnitee against all Expenses
incurred by Indemnitee in connection with each successfully
resolved claim, issue or matter.
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(c) To the extent that Indemnitee is, by
reason of an Indemnifiable Event, a witness in any Proceeding to
which Indemnitee is not a party, Indemnitee shall be indemnified
against all Expenses actually and reasonably incurred by or on
behalf of Indemnitee in connection therewith.
(d) The Company shall indemnify and hold
Indemnitee harmless from any Expenses incurred by or on behalf of
Indemnitee to recover under any liability insurance policy
maintained by any person for the benefit of Indemnitee in
connection with the performance of Indemnitee’s duties for or
on behalf of the Company.
(a) Obligation to Make Expense
Advances . Unless otherwise prohibi
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