Lithium Exploration Group, Inc.:Exhibit 10-12 - Filed by newsfilecorp.com






PURCHASE AGREEMENT 

                                           THIS PURCHASE AGREEMENT,
dated as of February 28, 2014, is entered into by and among Lithium Exploration
Group, Inc., a Nevada corporation (the “Company”), and VISTA CAPITAL
INVESTMENTS, LLC (the “Purchaser”). 

W I T N E S S E T H: 

                                           WHEREAS, the Company and
the Purchaser are executing and delivering this Agreement in accordance with and
in reliance upon the exemption from securities registration for offers and sales
to accredited investors afforded, inter alia, by Rule 506 under
Regulation D (“Regulation D”) as promulgated by the United States Securities
and Exchange Commission (the “SEC”) under the Securities Act of 1933, as amended
(the “1933 Act”), and/or Section 4(2) of the 1933 Act; and 

                                           WHEREAS, the Purchaser wishes to purchase a 12%
Convertible Promissory Note of the Company (the “Note”), subject to and upon the terms
and conditions of this Agreement and acceptance of this Agreement by the Company, on
the terms and conditions referred to herein. 

                                           NOW THEREFORE, in
  consideration of the premises and the mutual covenants contained herein and
  other good and valuable consideration, the receipt and sufficiency of which are
hereby acknowledged, the parties agree as follows: 

                                           1.                      AGREEMENT TO PURCHASE; PURCHASE PRICE. 

                                           a.                      Purchase. 

                                           (i)                     Subject to the terms and
conditions of this Agreement and the other Transaction Documents, the Purchaser
hereby agrees to purchase a Note in the aggregate amount of $110,000 (the
“Purchase Amount”), which includes the aggregate principal sum of $100,000 (one
hundred thousand dollars) advanced by the Purchaser, and a 10% original issue
discount. which Note shall be funded and issuable as follows: 

                                           (a)                    $100,000 of the Note shall be funded and issued by February
28, 2014. 

                                           (ii)                    The Note referred to herein
shall be in the form of Annex I annexed hereto. 

                                           (iii)                   In consideration for the
Purchaser agreeing to Purchase the Note, the Company agrees to issue to the
Purchaser the Warrants (as defined herein) in the form of Annex II
hereto. Additional provisions relating to the Warrants are provided below. 

                                           (iv)                  The purchase of the Note and
the issuance of the Warrants to the Purchaser and the other transactions
contemplated hereby are sometimes referred to herein and in the other Transaction Documents as the purchase and sale of the
Securities (as defined below), and are referred to collectively as the
“Transactions”.

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                                            b.                      Certain Definitions. As
used herein, each of the following terms has the meaning set forth below, unless
the context otherwise requires: 

                                            “Affiliate” means, with respect
to a specific Person referred to in the relevant provision, another Person who
or which controls or is controlled by or is under common control with such
specified Person. 

                                            “Certificate” means the original signed Notes duly executed by
the Company. 

                                            “Closing Date” means the date of the closing of the issuance of
Notes. 

                                            “Common Stock Equivalents” means
any securities of the Company or the Subsidiaries which would entitle the holder
thereof to acquire at any time Common Stock, including without limitation, any
debt, preferred stock, rights, options, warrants or other instrument that is at
any time convertible into or exchangeable for, or otherwise entitles the holder
thereof to receive, Common Stock. 

                                            “Company Control Person” means
each director, executive officer, promoter, and such other Persons as may be
deemed in control of the Company pursuant to Rule 405 under the 1933 Act or
Section 20 of the 1934 Act (as defined below). 

                                            “Exchange Act” means the Securities Exchange Act of 1934, as
amended. 

                                            “Holder” means the Person holding the relevant Securities at the
  relevant time.

                                             “Last Audited Date” means December 31, 2013. 

                                            “Purchaser Control Person” means
each director, executive officer, promoter, and such other Persons as may be
deemed in control of the Purchaser pursuant to Rule 405 under the 1933 Act or
Section 20 of the 1934 Act. 

                                            “Material Adverse Effect” means
an event or combination of events, which individually or in the aggregate, would
reasonably be expected to (w) adversely affect the legality, validity or
enforceability of the Securities or any of the Transaction Documents, (x) have
or result in a material adverse effect on the results of operations, assets,
prospects, or condition (financial or otherwise) of the Company and its
subsidiaries, taken as a whole, (y) adversely impair the Company's ability to
perform fully on a timely basis its obligations under any of the Transaction
Documents or the transactions contemplated thereby, or (z) materially and
adversely affect the value of the rights granted to the Purchaser in the
Transaction Documents. 

                                            “Person” means any living person
or any entity, such as, but not necessarily limited to, a corporation,
partnership or trust. 

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                                            “Principal Trading Market” means
the Over the Counter Bulletin Board or such other market on which the Common
Stock is principally traded at the relevant time. 

                                            “Securities” means the Note, the
Warrants, the Warrant Shares, and any shares of common stock of the Company that
may be issued to the Purchaser in connection with any other agreements between
the parties. 

                                            “Shares” means the shares of
representing any or all of common shares underlying the Note and the Warrant
Shares.

                                            “State of Incorporation” means Nevada. 

                                            “Subsidiary” means any subsidiary of the Company. 

                                            “Trading Day” means any day
during which the Principal Trading Market shall be open for business. 

                                            “Transfer Agent” means, at any time, the transfer agent for the
Company’s Common Stock. 

                                            “Transaction Documents” means
  this Purchase Agreement, the Note, the form of Warrant and includes all
ancillary documents referred to in those agreements. 

                                            “Warrants” means, collectively,
share purchase warrants entitling the Purchaser to acquire Shares of the
Company’s common stock, and the number of Warrants issuable shall be determined
by the Purchase Amount divided by the conversion price of the Notes on the
initial Closing Date, multiplied by 150%. 

                                            “Warrant Shares” means shares of Common Stock underlying the
Warrants. 

                                            c.                      Form of Payment; Delivery of Certificates.

                                            (i)                      The Purchaser shall pay the
Purchase Amount by delivering immediately available good funds in United States
Dollars to the Company on the applicable Closing Date.

                                            (ii)                     On the applicable Closing
Date, the Company shall deliver the Certificates and the Warrants, each duly
executed on behalf of the Company to the Purchaser. 

                                            (iii)                    By signing this Agreement,
each of the Purchaser and the Company agrees to all of the terms and conditions
of the Transaction Documents, all of the provisions of which are incorporated
herein by this reference as if set forth in full. 

                                            d.                       Method of Payment.
Payment of the Purchase Amount shall be made by wire transfer of funds to:


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Account Name: Lithium Exploration Group 

Account Address: 3200 N. Hayden Road Suite 235 Scottsdale, AZ
85251 
ABA Routing Number: 122100024 
Account Number: 943483230

Bank Name: JPMORGAN CHASE BANK 


                                            2.                      PURCHASER REPRESENTATIONS,
WARRANTIES, ETC.; ACCESS TO INFORMATION; INDEPENDENT INVESTIGATION. 

                                            The Purchaser represents and
warrants to, and covenants and agrees with, the Company as follows: 

                                            a.                      Without limiting
Purchaser's right to sell the Securities pursuant to an effective registration
statement or otherwise in compliance with the 1933 Act, the Purchaser is
purchasing the Securities for its own account for investment only and not with a
view towards the public sale or distribution thereof and not with a view to or
for sale in connection with any distribution thereof. 

                                            b.                      The Purchaser is (i) an “accredited investor” as that
term is defined in Rule 501 of the General Rules and Regulations under the 1933
Act by reason of Rule 501(a)(3), (ii) experienced in making investments of the
kind described in this Agreement and the related documents, (iii) able, by
reason of the business and financial experience of its officers (if an entity)
and professional advisors (who are not affiliated with or compensated in any way
by the Company or any of its Affiliates or selling agents), to protect its own
interests in connection with the transactions described in this Agreement, and
the related documents, and to evaluate the merits and risks of an investment in
the Securities, and (iv) able to afford the entire loss of its investment in the
Securities. 

                                            c.                      All subsequent offers
  and sales of the Securities by the Purchaser shall be made pursuant to
  registration of the relevant Securities under the 1933 Act or pursuant to an
exemption from registration. 

                                            d.                      The Purchaser
understands that the Securities are being offered and sold to it in reliance on
specific exemptions from the registration requirements of the 1933 Act and state
securities laws and that the Company is relying upon the truth and accuracy of,
and the Purchaser's compliance with, the representations, warranties,
agreements, acknowledgments and understandings of the Purchaser set forth herein
in order to determine the availability of such exemptions and the eligibility of
the Purchaser to acquire the Securities. 

                                            e.                      The Purchaser and its
advisors, if any, have been furnished with or have been given access to all
materials relating to the business, finances and operations of the Company and
materials relating to the offer and sale of the Securities which have been
requested by the Purchaser, including those set forth on in any annex attached
hereto. The Purchaser and its advisors, if any, have been afforded the
opportunity to ask questions of the Company and its management and have received
complete and satisfactory answers to any such inquiries. Without limiting the
generality of the foregoing, the Purchaser has also had the opportunity to
obtain and to review the Company's filings on EDGAR (collectively, the
“Company's SEC Documents”). 

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                                            f.                      The Purchaser
understands that its investment in the Securities involves a high degree of
risk. 

                                            g.                      The Purchaser hereby
represents that, in connection with its purchase of the Securities, it has not
relied on any statement or representation by the Company or any of its officers,
directors and employees or any of their respective attorneys or agents, except
as specifically set forth herein.

                                            h.                      The Purchaser
understands that no United States federal or state agency or any other
government or governmental agency has passed on or made any recommendation or
endorsement of the Securities. 

                                            i.                      This Agreement and the
other Transaction Documents to which the Purchaser is a party, and the
transactions contemplated thereby, have been duly and validly authorized,
executed and delivered on behalf of the Purchaser and are valid and binding
agreements of the Purchaser enforceable in accordance with their respective
terms, subject as to enforceability to general principles of equity and to
bankruptcy, insolvency, moratorium and other similar laws affecting the
enforcement of creditors' rights generally. 

                                            3.                      COMPANY REPRESENTATIONS,
ETC. The Company represents and warrants to the Purchaser as of the date
hereof and as of the Closing Date. 

                                            a.                      Rights of Others Affecting
the Transactions. There are no preemptive rights of any shareholder of the
Company, as such, to acquire the Note, or any shares of the Company’s common stock that may be issued to the Purchaser in
connection with any other agreements between the parties, in the event such
shares are issued. No party other than a Purchaser has a currently exercisable
right of first refusal which would be applicable to any or all of the
transactions contemplated by the Transaction Documents. 

                                            b.                      Status. The Company is
  a corporation duly organized, validly existing and in good standing under the
  laws of the State of Nevada and has the requisite corporate power to own its
  properties and to carry on its business as now being conducted. The Company is
  duly qualified as a foreign corporation to do business and is in good standing
  in each jurisdiction where the nature of the business conducted or property
  owned by it makes such qualification necessary, other than those jurisdictions
  in which the failure to so qualify would not have or result in a Material
  Adverse Effect. The Company has registered its stock and is obligated to file
  reports pursuant to Section 12 or Section 15(d) of the Securities Exchange Act
  of 1934, as amended (the “1934 Act”). The Common Stock is, or immediately
  following the Closing Date will be, quoted on the Principal Trading Market. The
  Company has received no notice, either oral or written, with respect to the
  continued eligibility of the Common Stock for such quotation on the Principal
  Trading Market, and the Company has maintained all requirements on its part for
the continuation of such quotation.

                                            c.                      Authorized Shares.

                                            (i)                      The authorized capital stock
of the Company consists of 500,000,000 shares of Common Stock, $0.001 par value.


Page 5 




                                            (ii)                      The Company has sufficient
authorized and unissued shares of Common Stock as may be necessary to effect the
issuance of the Shares on the Closing Date.

                                            (iii)                      As of the Closing Date, the
Shares shall have been duly authorized by all necessary corporate action on the
part of the Company, and, when issued on the Closing Date or pursuant to other
relevant provisions of the Transaction Documents, in each case in accordance
with their respective terms, will be duly and validly issued, fully paid and
non-assessable and will not subject the Holder thereof to personal liability by
reason of being such Holder. 

                                            d.                      Transaction Documents and
Stock. This Agreement and each of the other Transaction Documents, and the
transactions contemplated thereby, have been duly and validly authorized by the
Company, this Agreement has been duly executed and delivered by the Company and
this Agreement is, and the Note and each of the other Transaction Documents,
when executed and delivered by the Company, will be, valid and binding
agreements of the Company enforceable in accordance with their respective terms,
subject as to enforceability to general principles of equity and to bankruptcy,
insolvency, moratorium, and other similar laws affecting the enforcement of
creditors' rights generally. 

                                            e.                      Non-contravention. The
execution and delivery of this Agreement and each of the other Transaction
Documents by the Company, the issuance of the Securities, and the consummation
by the Company of the other transactions contemplated by this Agreement, each of
the Notes and the other Transaction Documents do not and will not conflict with
or result in a breach by the Company of any of the terms or provisions of, or
constitute a default under (i) the certificate of incorporation or by-laws of
the Company, each as currently in effect, (ii) any indenture, mortgage, deed of
trust, or other material agreement or instrument to which the Company is a party
or by which it or any of its properties or assets are bound, including any
listing agreement for the Common Stock except as herein set forth, or (iii) to
its knowledge, any existing applicable law, rule, or regulation or any
applicable decree, judgment, or order of any court, United States federal or
state regulatory body, administrative agency, or other governmental body having
jurisdiction over the Company or any of its properties or assets, except such
conflict, breach or default which would not have or result in a Material Adverse
Effect. 

                                            f.                      Approvals. No
authorization, approval or consent of any court, governmental body, regulatory
agency, self-regulatory organization, or stock exchange or market or the
shareholders of the Company is required to be obtained by the Company for the
issuance and sale of the Securities to the Purchaser as contemplated by this
Agreement, except such authorizations, approvals and consents that have been
obtained. 

                                            g.                      Filings. None of the
Company’s SEC Documents contained, at the time they were filed, any untrue
statement of a material fact or omitted to state any material fact required to
be stated therein or necessary to make the statements made therein in light of
the circumstances under which they were made, not misleading. 

Page 6 




                                            h.                      Absence of Certain
Changes. Since the Last Audited Date, there has been no material adverse
change and no Material Adverse Effect, except as disclosed in the Company’s SEC Documents. Since the Last Audited Date, except as
provided in the Company’s SEC Documents, the Company has not (i) incurred or
become subject to any material liabilities (absolute or contingent) except
liabilities incurred in the ordinary course of business consistent with past
practices; (ii) discharged or satisfied any material lien or encumbrance or paid
any material obligation or liability (absolute or contingent), other than
current liabilities paid in the ordinary course of business consistent with past
practices; (iii) declared or made any payment or distribution of cash or other
property to shareholders with respect to its capital stock, or purchased or
redeemed, or made any agreements to purchase or redeem, any shares of its
capital stock; (iv) sold, assigned or transferred any other tangible assets, or
canceled any debts owed to the Company by any third party or claims of the
Company against any third party, except in the ordinary course of business
consistent with past practices; (v) waived any rights of material value, whether
or not in the ordinary course of business, or suffered the loss of any material
amount of existing business; (vi) made any increases in employee compensation,
except in the ordinary course of business consistent with past practices; or
(vii) experienced any material problems with labor or management in connection
with the terms and conditions of their employment. 

                                            i.                      Full Disclosure. To the
best of the Company’s knowledge, there is no fact known to the Company (other
than general economic conditions known to the public generally or as disclosed
in the Company’s SEC Documents) that has not been disclosed in writing to the
Purchaser that would reasonably be expected to have or result in a Material
Adverse Effect. 

                                            j.                      Absence of Litigation.
There is no action, suit, proceeding, inquiry or investigation before or by any
court, public board or body pending or, to the knowledge of the Company,
threatened against or affecting the Company before or by any governmental
authority or nongovernmental department, commission, board, bureau, agency or
instrumentality or any other person, wherein an unfavorable decision, ruling or
finding would have a Material Adverse Effect or which would adversely affect the
validity or enforceability of, or the authority or ability of the Company to
perform its obligations under, any of the Transaction Documents. The Company is
not aware of any valid basis for any such claim that (either individually or in
the aggregate with all other such events and circumstances) could reasonably be
expected to have a Material Adverse Effect. There are no outstanding or
unsatisfied judgments, orders, decrees, writs, injunctions or stipulations to
which the Company is a party or by which it or any of its properties is bound,
that involve the transaction contemplated herein or that, alone or in the
aggregate, could reasonably be expect to have a Material Adverse Effect. 

                                            k.                      Absence of Events of
Default. Except as set forth in Section 3(e) and 3(g) hereof, (i) neither
the Company nor any of its subsidiaries is in default in the performance or
observance of any material obligation, agreement, covenant or condition
contained in any material indenture, mortgage, deed of trust or other material
agreement to which it is a party or by which its property is bound, and (ii) no
Event of Default (or its equivalent term), as defined in the respective
agreement to which the Company or its subsidiary is a party, and no event which,
with the giving of notice or the passage of time or both, would become an Event
of Default (or its equivalent term) (as so defined in such agreement), has
occurred and is continuing, which would have a Material Adverse Effect. 

Page 7 




                                            l.                      No Undisclosed Liabilities
or Events. To the best of the Company’s knowledge, the Company has no
liabilities or obligations other than those disclosed in the Transaction
Documents or the Company's SEC Documents or those incurred in the ordinary
course of the Company's business since the Last Audited Date, or which
individually or in the aggregate, do not or would not have a Material Adverse
Effect. No event or circumstances has occurred or exists with respect to the
Company or its properties, business, operations, condition (financial or
otherwise), or results of operations, which, under applicable law, rule or
regulation, requires public disclosure or announcement prior to the date hereof
by the Company but which has not been so publicly announced or disclosed. There
are no proposals currently under consideration or currently anticipated to be
under consideration by the Board of Directors or the executive officers of the
Company which proposal would (x) change the articles or certificate of
incorporation or other charter document or by-laws of the Company, each as
currently in effect, with or without shareholder approval, which change would
reduce or otherwise adversely affect the rights and powers of the shareholders
of the Common Stock or (y) materially or substantially change the business,
assets or capital of the Company, including its interests in subsidiaries. 

                                            m.                      No Integrated Offering.
Neither the Company nor any of its Affiliates nor any Person acting on its or
their behalf has, directly or indirectly, at any time since December 31, 2007,
made any offer or sales of any security or solicited any offers to buy any
security under circumstances that would eliminate the availability of the
exemption from registration under Regulation D in connection with the offer and
sale of the Securities as contemplated hereby. 

                                            n.                      Dilution. Any shares of the Company’s common stock
issued to the Purchaser in connection with any agreements between the parties
hereto, in the event such shares are issued may have a dilutive effect on the
ownership interests of the other shareholders (and Persons having the right to
become shareholders) of the Company. The Company's executive officers and
directors have studied and fully understand the nature of the Securities being
sold hereby and recognize that they have such a potential dilutive effect. The
board of directors of the Company has concluded, in its good faith business
judgment, that such issuance is in the best interests of the Company. 

                                            o.                      Confirmation. The
  Company confirms that all statements of the Company contained herein shall
  survive acceptance of this Agreement by the Purchaser. The Company agrees that,
  if any events occur or circumstances exist prior to the Closing Date or the
  release of the Purchase Amount to the Company which would make any of the
  Company’s representations, warranties, agreements or other information set forth
  herein materially untrue or materially inaccurate as of such date, the Company
  shall immediately notify the Purchaser (directly or through its counsel, if any)
  in writing prior to such date of such fact, specifying which representation,
warranty or covenant is affected and the reasons therefor. 

                                            p.                      Authorization; Enforcement.
The Company has the requisite corporate power and authority to enter into
and to consummate the transactions contemplated by each of the Transaction
Documents and otherwise to carry out its obligations thereunder. The execution
and delivery of each of the Transaction Documents by the Company and the
consummation by it of the transactions contemplated thereby have been duly
authorized by all necessary action on the part of the Company and no further
action is required by the Company in connection therewith. Each Transaction
Agreement has been (or upon delivery will have been) duly executed by the Company and, when delivered in accordance with
the terms hereof, will constitute the valid and binding obligation of the
Company enforceable against the Company in accordance with its terms except (i)
as limited by applicable bankruptcy, insolvency, reorganization, moratorium and
other laws of general application affecting enforcement of creditors’ rights
generally and (ii) as limited by laws relating to the availability of specific
performance, injunctive relief or other equitable remedies.

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                                            q.                      SEC Reports; Financial
Statements. Other than as previously disclosed to the Purchaser, the Company
has filed all reports required to be filed by it under the Exchange Act,
including pursuant to Section 13(a) or 15(d) thereof, for the two years
preceding the date hereof (or such shorter period as the Company was required by
law to file such material) (the foregoing materials, including the exhibits
thereto, being collectively referred to herein as the “SEC Reports”) on a timely basis or has received a valid
extension of such time of filing and has filed any such SEC Reports prior to the
expiration of any such extension. As of their respective dates, the SEC Reports
complied in all material respects with the requirements of the Exchange Act and
the rules and regulations of the Commission promulgated thereunder, and none of
the SEC Reports, when filed, contained any untrue statement of a material fact
or omitted to state a material fact required to be stated therein or necessary
in order to make the statements therein, in light of the circumstances under
which they were made, not misleading. The financial statements of the Company
comply in all material respects with applicable accounting requirements and the
rules and regulations of the Commission with respect thereto as in effect at the
time of filing. Such financial statements have been prepared in accordance with
United States generally accepted accounting principles applied on a consistent
basis during the periods involved (“GAAP”), except as may be otherwise
specified in such financial statements or the notes thereto and except that
unaudited financial statements may not contain all footnotes required by GAAP,
and fairly present in all material respects the financial position of the
Company and its consolidated subsidiaries as of and for the dates thereof and
the results of operations and cash flows for the periods then ended, subject, in
the case of unaudited statements, to normal, immaterial, year-end audit
adjustments. 

                                            r.                      Sarbanes-Oxley; Internal
Accounting Controls. The Company is in material compliance with all
provisions of the Sarbanes-Oxley Act of 2002 which are applicable to it as of
the Closing Date. The Company and the Subsidiaries maintain a system of internal
accounting controls sufficient to provide reasonable assurance that (i)
transactions are executed in accordance with management's general or specific
authorizations, (ii) transactions are recorded as necessary to permit
preparation of financial statements in conformity with GAAP and to maintain
asset accountability, (iii) access to assets is permitted only in accordance
with management's general or specific authorization, and (iv) the recorded
accountability for assets is compared with the existing assets at reasonable
intervals and appropriate action is taken with respect to any differences. The
Company has established disclosure controls and procedures (as defined in
Exchange Act Rules 13a-15(e) and 15d-15(e)) for the Company and designed such
disclosure controls and procedures to ensure that material information relating
to the Company, including its Subsidiaries, is made known to the certifying
officers by others within those entities, particularly during the period in
which the Company's most recently filed periodic report under the Exchange Act,
as the case may be, is being prepared. The Company's certifying officers have
evaluated the effectiveness of the Company's controls and procedures as of the
date prior to the filing date of the most recently filed periodic report under
the Exchange Act (such date, the “Evaluation Date”). The Company presented in
its most recently filed periodic report under the Exchange Act the conclusions
of the certifying officers about the effectiveness of the disclosure controls
and procedures based on their evaluations as of the Evaluation Date. Since the
Evaluation Date, there have been no significant changes in the Company's
internal controls (as such term is defined in Item 307(b) of Regulation S-K
under the Exchange Act) or, to the Company's knowledge, in other factors that
could significantly affect the Company's internal controls.

Page 9 




                                            s.                      Tax Status.
Except for matters that would not, individually or in the aggregate, have or
reasonably be expected to result in a Material Adverse Effect, the Company and
each Subsidiary has filed all necessary federal, state and foreign income and
franchise tax returns and has paid or accrued all taxes shown as due thereon,
and the Company has no knowledge of a tax deficiency which has been asserted or
threatened against the Company or any Subsidiary. 

                                            t.                      No Disagreements with
Accountants and Lawyers. There are no disagreements of any kind presently
existing, or reasonably anticipated by the Company to arise, between the
accountants and lawyers formerly or presently employed by the Company and the
Company is current with respect to any fees owed to its accountants and lawyers.
By making this representation the Company does not, in any manner, waive the
attorney/client privilege or the confidentiality of the communications between
the Company and its lawyers. 

                                            4.                      CERTAIN COVENANTS AND ACKNOWLEDGMENTS. 

                                            a.                      Transfer Restrictions.
The Purchaser acknowledges that (1) the Securities have not been and are not
being registered under the provisions of the 1933 Act and, the Shares have not
been and are not being registered under the 1933 Act, and may not be transferred
unless (A) subsequently registered thereunder or (B) the Purchaser shall have
delivered to the Company an opinion of counsel, reasonably satisfactory in form,
scope and substance to the Company, to the effect that the Securities to be sold
or transferred may be sold or transferred pursuant to an exemption from such
registration; (2) any sale of the Securities made in reliance on Rule 144
promulgated under the 1933 Act (“Rule 144") may be made only in accordance with
the terms of said Rule and further, if said Rule is not applicable, any resale
of such Securities under circumstances in which the seller, or the Person
through whom the sale is made, may be deemed to be an underwriter, as that term
is used in the 1933 Act, may require compliance with some other exemption under
the 1933 Act or the rules and regulations of the SEC thereunder; and (3) neither
the Company nor any other Person is under any obligation to register the
Securities (other than pursuant to the Registration Rights Provisions) under the
1933 Act or to comply with the terms and conditions of any exemption thereunder.


                                            b.                      Restrictive Legend. The
Purchaser acknowledges and agrees that the certificates and other instruments
representing any of the Securities shall bear a restrictive legend in
substantially the following form (and a stop-transfer order may be placed
against transfer of any such Securities): 


  	“THESE SECURITIES HAVE NOT BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR THE SECURITIES LAWS OF ANY STATE AND MAY NOT BE SOLD OR OFFERED FOR SALE IN THE
ABSENCE OF AN EFFECTIVE REGISTRATION STATEMENT FOR THE SECURITIES OR AN OPINION
OF COUNSEL OR OTHER EVIDENCE ACCEPTABLE TO THE COMPANY THAT SUCH REGISTRATION IS
NOT REQUIRED.” 





Page 10 




                                            c.                      Filings. The Company
undertakes and agrees to make all necessary filings in connection with the sale
of the Securities to the Purchaser under any United States laws and regulations
applicable to the Company, or by any domestic securities exchange or trading
market, and to provide a copy thereof to the Purchaser promptly after such
filing. 

                                            d.                      Reporting Status. So
long as the Purchaser beneficially owns any of the Securities, the Company shall
file all reports required to be filed with the SEC pursuant to Section 13 or
15(d) of the 1934 Act, shall take all reasonable action under its control to
ensure that adequate current public information with respect to the Company, as
required in accordance with Rule 144(c)(2) of the 1933 Act, is publicly
available, and shall not terminate its status as an issuer required to file
reports under the 1934 Act even if the 1934 Act or the rules and regulations
thereunder would permit such termination. The Company will take all reasonable
action under its control to maintain the continued listing and quotation and
trading of its Common Stock on the Principal Trading Market or a listing on the
NASDAQ/Small Cap or National Markets and, to the extent applicable to it, will
comply in all material respects with the Company’s reporting, filing and other obligations under the
by-laws or rules of the Principal Trading Market and/or the National Association
of Securities Dealers, Inc., as the case may be, applicable to it for so long as
the Purchaser beneficially owns any of the Securities. 

                                            e.                      Use of Proceeds.
  The Company will use the proceeds received hereunder (excluding amounts paid by
  the Company for legal fees in connection with the sale of the Securities) for
working capital. 

                                            f.                      Warrant. The Company
agrees to issue the Warrants to the Purchaser on the applicable Closing Dates.
The form of Warrant is provided in Annex II annexed hereto, the terms of
which are incorporated herein by reference.

                                            g.                      Publicity, Filings,
Releases, Etc. Each of the parties agrees that it will not disseminate any
information relating to the Transaction Documents or the transactions
contemplated thereby, including issuing any press releases, holding any press
conferences or other forums, or filing any reports (collectively, “Publicity”),
without giving the other party reasonable advance notice and an opportunity to
comment on the contents thereof. Neither party will include in any such
Publicity any statement or statements or other material to which the other party
reasonably objects, unless in the reasonable opinion of counsel to the party
proposing such statement, such statement is legally required to be included. In
furtherance of the foregoing, the Company will provide to the Purchaser drafts
of the applicable text of the first filing of a Current Report on Form 8-K or a
Quarterly or Annual Report on Form 10-Q or 10-K intended to be made with the SEC
which refers to the Transaction Documents or the transactions contemplated
thereby as soon as practicable (but at least two (2) Trading Days before such
filing will be made) will not include in such filing any statement or statements
or other material to which the other party reasonably objects, unless in the
reasonable opinion of counsel to the party proposing such statement, such statement is legally required to
be included. Notwithstanding the foregoing, each of the parties hereby consents
to the inclusion of the text of the Transaction Documents in filings made with
the SEC as well as any descriptive text accompanying or part of such filing
which is accurate and reasonably determined by the Company’s counsel to be
legally required. Notwithstanding, but subject to, the foregoing provisions of
this Section 4(i), the Company will, after the Closing Date, promptly file a
Current Report on Form 8-K or, if appropriate, a quarterly or annual report on
the appropriate form, referring to the transactions contemplated by the
Transaction Documents.

Page 11 




                                            5.                      TRANSFER AGENT INSTRUCTIONS. 

                                            a.                      The Company warrants
that, with respect to the Securities, other than the stop transfer instructions
to give effect to Section 4(a) hereof, it will give its transfer agent no
instructions inconsistent with instructions to issue Common Stock to the Holder
as contemplated in the Transaction Documents. Nothing in this Section shall
affect in any way the Purchaser's obligations and agreement to comply with all
applicable securities laws upon resale of the Securities. If the Purchaser
provides the Company with an opinion of counsel reasonably satisfactory to the
Company that registration of a resale by the Purchaser of any of the Securities
in accordance with clause (1)(B) of Section 4(a) of this Agreement is not
required under the 1933 Act, the Company shall (except as provided in clause (2)
of Section 4(a) of this Agreement) permit the transfer or reissue of the Shares
represented by one or more certificates for Common Stock without legend (or
where applicable, by electronic registration) in such name and in such
denominations as specified by the Purchaser. 

                                            b.                      The Company will
authorize the Transfer Agent to give information relating to the Company
directly to the Holder or the Holder’s representatives upon the request of the
Holder or any such representative, to the extent such information relates to (i)
the status of shares of Common Stock issued or claimed to be issued to the
Holder in connection with a Notice of Exercise or transfer of Pledged Shares to
the Holder, or (ii) the aggregate number of outstanding shares of Common Stock
of all shareholders (as a group, and not individually) as of a current or other
specified date. At the request of the Holder, the Company will provide the
Holder with a copy of the authorization so given to the Transfer Agent. 

                                            6.                      CLOSING DATE. 

                                            a.                      The respective Closing
Date shall occur as indicated in Section 1(a)(1) after each of the conditions
contemplated by Sections 7 and 8 hereof shall have either been satisfied or been
waived by the party in whose favor such conditions run. 

                                            b.                      The closing of the
Transactions shall occur on the respective Closing Date at the offices of the
Purchaser and shall take place no later than 3:00 P.M., PST, on such day or such
other time as is mutually agreed upon by the Company and the Purchaser. 

                                            7.                      CONDITIONS TO THE COMPANY'S OBLIGATION TO SELL. 

                                            The Purchaser understands that
the Company's obligation to sell the Note and the Warrants to the Purchaser
pursuant to this Agreement on the Closing Date is conditioned upon: 

Page 12 




                                            a.                      The execution and delivery of this Agreement by the
Purchaser; 

                                            b.                      Delivery by the
Purchaser to the Company of good funds as payment in full of an amount equal to
the Purchase Amount in accordance with this Agreement; 

                                            c.                      The accuracy on such
Closing Date of the representations and warranties of the Purchaser contained in
this Agreement, each as if made on such date, and the performance by the
Purchaser on or before such date of all covenants and agreements of the
Purchaser required to be performed on or before such date; and 

                                            d.                      There shall not be in
effect any law, rule or regulation prohibiting or restricting the transactions
contemplated hereby, or requiring any consent or approval which shall not have
been obtained. 

                                            8.                      CONDITIONS TO THE PURCHASER'S OBLIGATION TO
PURCHASE. 

                                            The Company understands that the
Purchaser’s obligation to purchase any Notes and its acceptance of any shares of
the Company’s common stock that may be issued in connection with any agreements
between the parties hereto on a Closing Date is conditioned upon: 

                                            a.                      The execution and
delivery of this Agreement and the other Transaction Documents by the Company;


                                            b.                      Delivery by the Company
to the Purchaser of the Certificates in accordance with this Agreement or any
other agreements between the parties; 

                                            c.                      The execution and delivery of the Warrants; 

                                            d.                      The accuracy in all
material respects on the Closing Date of the representations and warranties of
the Company contained in this Agreement, each as if made on such date, and the
performance by the Company on or before such date of all covenants and
agreements of the Company required to be performed on or before such date;

                                            e.                      The Company must be current with all required
Exchange Act filings. 

                                            f.                      There shall not be in
effect any law, rule or regulation prohibiting or restricting the transactions
contemplated hereby, or requiring any consent or approval which shall not have
been obtained; and 

                                            g.                      From and after the date
hereof to and including the Closing Date, each of the following conditions will
remain in effect: (i) the trading of the Common Stock shall not have been
suspended by the SEC or on the Principal Trading Market; (ii) trading in
securities generally on the Principal Trading Market shall not have been
suspended or limited; (iii) no minimum prices shall been established for securities traded on
the Principal Trading Market; and (iv) there shall not have been any Material
Adverse Effect in regards to the Company. 

Page 13 




                                            9.                      REGISTRATION RIGHTS 

                                            If at any time after the Closing
Date there is not an effective registration statement covering all of the then
issued and outstanding Shares and Warrant Shares (the “Registrable
Securities”) and the Company determines to prepare and file with the SEC a
registration statement relating to an offering for its own account or the
account of others under the Securities Act of any of its equity securities, but
excluding Forms S-4 or S-8 and similar forms which do not permit such
registration, then the Company shall send to each holder of any of the
Registrable Securities written notice of such determination and, if within
fifteen calendar days after receipt of such notice, any such holder shall so
request in writing, the Company shall include in such registration statement all
or any part of the Registrable Securities, provided that the inclusion of such
Registrable Securities will be subject to customary underwriter cutbacks
applicable to all holders of registration rights and minimum cutbacks in
accordance with guidance provided by the Securities and Exchange Commission
(including, but not limited to, Rule 415). The obligations of the Company under
this Section may be waived by any holder of any of the Registrable Securities
entitled to registration rights under this Section 9. The holders whose
Registrable Securities are included or required to be included in such
registration statement are granted the same rights, benefits, liquidated or
other damages and indemnification granted to other holders of securities
included in such registration statement. In no event shall the liability of any
holder of Registrable Securities or permitted successor in connection with any
Registrable Securities included in any such registration statement be greater in
amount than the dollar amount of the net proceeds actually received by such
holder upon the sale of the Registrable Securities sold pursuant to such
registration or such lesser amount in proportion to all other holders of
Registrable Securities included in such registration statement. All expenses
incurred by the Company in complying with Section 9, including, without
limitation, all registration and filing fees, printing expenses (if required),
fees and disbursements of counsel and independent public accountants for the
Company, fees and expenses (including reasonable counsel fees) incurred in
connection with complying with state securities or “blue sky” laws, fees of the
FINRA, transfer taxes, and fees of transfer agents and registrars, are called
“Registration Expenses.” All underwriting discounts and selling commissions
applicable to the sale of Registrable Securities are called "Selling Expenses."
The Company will pay all Registration Expenses in connection with the
registration statement under Section 9. Selling Expenses in connection with each
registration statement under Section 9 shall be borne by the holder and will be
apportioned among such holders in proportion to the number of Registrable
Securities included therein for a holder relative to all the securities included
therein for all selling holders, or as all holders may agree. It shall be a
condition precedent to the obligations of the Company to complete the
registration pursuant to this Agreement with respect to the Registrable
Securities of a particular holder that such holder shall furnish to the Company
in writing such information and representation letters, including a completed
form of a securityholder questionnaire, with respect to itself and the proposed
distribution by it as the Company may reasonably request to assure compliance
with federal and applicable state securities laws. Shares shall cease to be
Registrable Securities pursuant to this Section 9 upon the earliest to occur of
the following: (A) a sale pursuant to a registration statement or Rule 144 under
the Securities Act (in which case, only such security sold by the holder shall
cease to be a Registrable Security); or (B) becoming eligible for resale by the holder under Rule 144 without the
requirement for the Company to be in compliance with the current public
information required thereunder and without volume or manner-of-sale
restrictions, pursuant to a written opinion letter to such effect, addressed,
delivered and acceptable to the Company’s transfer agent.

Page 14 




                                            10. INDEMNIFICATION AND REIMBURSEMENT. 

                                            a.                      (i)                      The Company agrees
to indemnify and hold harmless the Purchaser and its officers, directors,
employees, and agents, and each Purchaser Control Person from and against any
losses, claims, damages, liabilities or expenses incurred (collectively,
“Damages”), joint or several, and any action in respect thereof to which the
Purchaser, its partners, Affiliates, officers, directors, employees, and duly
authorized agents, and any such Purchaser Control Person becomes subject to,
resulting from, arising out of or relating to any misrepresentation, breach of
warranty or nonfulfillment of or failure to perform any covenant or agreement on
the part of Company contained in this Agreement, as such Damages are incurred,
except to the extent such Damages result primarily from Purchaser's failure to
perform any covenant or agreement contained in this Agreement or the Purchaser's
or its officer’s, director’s, employee’s, agent’s or Purchaser Control Person’s
negligence, recklessness or bad faith in performing its obligations under this
Agreement. 

                                                                     (ii)                      The Company hereby agrees
that, if the Purchaser, other than by reason of its negligence, illegal or
willful misconduct (in each case, as determined by a non-appealable judgment to
such effect), (x) becomes involved in any capacity in any action, proceeding or
investigation brought by any shareholder of the Company, in connection with or
as a result of the consummation of the transactions contemplated by this
Agreement or the other Transaction Documents, or if the Purchaser is impleaded
in any such action, proceeding or investigation by any Person, or (y) becomes
involved in any capacity in any action, proceeding or investigation brought by
the SEC, any self-regulatory organization or other body having jurisdiction,
against or involving the Company or in connection with or as a result of the
consummation of the transactions contemplated by this Agreement or the other
Transaction Documents, or (z) is impleaded in any such action, proceeding or
investigation by any Person, then in any such case, the Company shall indemnify,
defend and hold harmless the Purchaser from and against and in respect of all
losses, claims, liabilities, damages or expenses resulting from, imposed upon or
incurred by the Purchaser, directly or indirectly, and reimburse such Purchaser
for its reasonable legal and other expenses (including the cost of any
investigation and preparation) incurred in connection therewith, as such
expenses are incurred. The indemnification and reimbursement obligations of the
Company under this paragraph shall be in addition to any liability which the
Company may otherwise have, shall extend upon the same terms and conditions to
any Affiliates of the Purchaser who are actually named in such action,
proceeding or investigation, and partners, directors, agents, employees and
Purchaser Control Persons (if any), as the case may be, of the Purchaser and any
such Affiliate, and shall be binding upon and inure to the benefit of any
successors, assigns, heirs and personal representatives of the Company, the
Purchaser, any such Affiliate and any such Person. The Company also agrees that
neither the Purchaser nor any such Affiliate, partner, director, agent, employee
or Purchaser Control Person shall have any liability to the Company or any
Person asserting claims on behalf of or in right of the Company in connection
with or as a result of the consummation of this Agreement or the other Transaction Documents, except as may be
expressly and specifically provided in or contemplated by this Agreement. 

Page 15 




                                            b.                      All claims for
indemnification by any Indemnified Party (as defined below) under this Section
shall be asserted and resolved as follows: 

                                                                      (i)                      In the event any claim or
demand in respect of which any Person claiming indemnification under any
provision of this Section (an “Indemnified Party”) might seek indemnity under
paragraph (a) of this Section is asserted against or sought to be collected from
such Indemnified Party by a Person other than a party hereto or an Affiliate
thereof (a “Third Party Claim”), the Indemnified Party shall deliver a written
notification, enclosing a copy of all papers served, if any, and specifying the
nature of and basis for such Third Party Claim and for the Indemnified Party's
claim for indemnification that is being asserted under any provision of this
Section against any Person (the “Indemnifying Party”), together with the amount
or, if not then reasonably ascertainable, the estimated amount, determined in
good faith, of such Third Party Claim (a “Claim Notice”) with reasonable
promptness to the Indemnifying Party. If the Indemnified Party fails to provide
the Claim Notice with reasonable promptness after the Indemnified Party receives
notice of such Third Party Claim, the Indemnifying Party shall not be obligated
to indemnify the Indemnified Party with respect to such Third Party Claim to the
extent that the Indemnifying Party's ability to defend has been prejudiced by
such failure of the Indemnified Party. The Indemnifying Party shall notify the
Indemnified Party as soon as practicable within the period ending thirty (30)
calendar days following receipt by the Indemnifying Party of either a Claim
Notice or an Indemnity Notice (as defined below) (the “Dispute Period”) whether
the Indemnifying Party disputes its liability or the amount of its liability to
the Indemnified Party under this Section and whether the Indemnifying Party
desires, at its sole cost and expense, to defend the Indemnified Party against
such Third Party Claim. The following provisions shall also apply. 


  	 (x) If the Indemnifying Party notifies
the Indemnified Party within the Dispute Period that the Indemnifying Party
desires to defend the Indemnified Party with respect to the Third Party Claim
pursuant to this paragraph (b) of this Section, then the Indemnifying Party
shall have the right to defend, with counsel reasonably satisfactory to the
Indemnified Party, at the sole cost and expense of the Indemnifying Party, such
Third Party Claim by all appropriate proceedings, which proceedings shall be
vigorously and diligently prosecuted by the Indemnifying Party to a final
conclusion or will be settled at the discretion of the Indemnifying Party (but
only with the consent of the Indemnified Party in the case of any settlement
that provides for any relief other than the payment of monetary damages or that
provides for the payment of monetary damages as to which the Indemnified Party
shall not be indemnified in full pursuant to paragraph (a) of this Section). The
Indemnifying Party shall have full control of such defense and proceedings,
including any compromise or settlement thereof; provided, however, that the
Indemnified Party may, at the sole cost and expense of the Indemnified Party, at
any time prior to the Indemnifying Party's delivery of the notice referred to in
the first sentence of this subparagraph (x), file any motion, answer or other
pleadings or take any other action that the Indemnified Party reasonably
believes to be necessary or appropriate protect its interests; and provided further, that if requested by the Indemnifying Party,
the Indemnified Party will, at the sole cost and expense of the Indemnifying
Party, provide reasonable cooperation to the Indemnifying Party in contesting
any Third Party Claim that the Indemnifying Party elects to contest. The
Indemnified Party may participate in, but not control, any defense or settlement
of any Third Party Claim controlled by the Indemnifying Party pursuant to this
subparagraph (x), and except as provided in the preceding sentence, the
Indemnified Party shall bear its own costs and expenses with respect to such
participation. Notwithstanding the foregoing, the Indemnified Party may take
over the control of the defense or settlement of a Third Party Claim at any time
if it irrevocably waives its right to indemnity under paragraph (a) of this
Section with respect to such Third Party Claim. 





Page 16 







  	(y) If the Indemnifying Party fails to
notify the Indemnified Party within the Dispute Period that the Indemnifying
Party desires to defend the Third Party Claim pursuant to paragraph (b) of this
Section, or if the Indemnifying Party gives such notice but fails to prosecute
vigorously and diligently or settle the Third Party Claim, or if the
Indemnifying Party fails to give any notice whatsoever within the Dispute
Period, then the Indemnified Party shall have the right to defend, at the sole
cost and expense of the Indemnifying Party, the Third Party Claim by all
appropriate proceedings, which proceedings shall be prosecuted by the
Indemnified Party in a reasonable manner and in good faith or will be settled at
the discretion of the Indemnified Party (with the consent of the Indemnifying
Party, which consent will not be unreasonably withheld). The Indemnified Party
will have full control of such defense and proceedings, including any compromise
or settlement thereof; provided, however, that if requested by the Indemnified
Party, the Indemnifying Party will, at the sole cost and expense of the
Indemnifying Party, provide reasonable cooperation to the Indemnified Party and
its counsel in contesting any Third Party Claim which the Indemnified Party is
contesting. Notwithstanding the foregoing provisions of this subparagraph (y),
if the Indemnifying Party has notified the Indemnified Party within the Dispute
Period that the Indemnifying Party disputes its liability or the amount of its
liability hereunder to the Indemnified Party with respect to such Third Party
Claim and if such dispute is resolved in favor of the Indemnifying Party in the
manner provided in subparagraph(z) below, the Indemnifying Party will not be
required to bear the costs and expenses of the Indemnified Party's defense
pursuant to this subparagraph (y) or of the Indemnifying Party's participation
therein at the Indemnified Party's request, and the Indemnified Party shall
reimburse the Indemnifying Party in full for all reasonable costs and expenses
incurred by the Indemnifying Party in connection with such litigation. The
Indemnifying Party may participate in, but not control, any defense or
settlement controlled by the Indemnified Party pursuant to this subparagraph
(y), and the Indemnifying Party shall bear its own costs and expenses with
respect to such participation.

	 
	(z) If the Indemnifying Party notifies
        the Indemnified Party that it does not dispute its liability or the amount of
        its liability to the Indemnified Party with respect to the Third Party Claim under paragraph (a) of this
        Section or fails to notify the Indemnified Party within the Dispute Period
        whether the Indemnifying Party disputes its liability or the amount of its
        liability to the Indemnified Party with respect to such Third Party Claim, the
        amount of Damages specified in the Claim Notice shall be conclusively deemed a
        liability of the Indemnifying Party under paragraph (a) of this Section and the
        Indemnifying Party shall pay the amount of such Damages to the Indemnified Party
        on demand. If the Indemnifying Party has timely disputed its liability or the
        amount of its liability with respect to such claim, the Indemnifying Party and
        the Indemnified Party shall proceed in good faith to negotiate a resolution of
        such dispute; provided, however, that if the dispute is not resolved within
        thirty (30) days after the Claim Notice, the Indemnifying Party shall be
      entitled to institute such legal action as it deems appropriate.





Page 17 




                                                                      (ii)                      In the event any Indemnified
Party should have a claim under paragraph (a) of this Section against the
Indemnifying Party that does not involve a Third Party Claim, the Indemnified
Party shall deliver a written notification of a claim for indemnity under
paragraph (a) of this Section specifying the nature of and basis for such claim,
together with the amount or, if not then reasonably ascertainable, the estimated
amount, determined in good faith, of such claim (an "Indemnity Notice") with
reasonable promptness to the Indemnifying Party. The failure by any Indemnified
Party to give the Indemnity Notice shall not impair such party's rights
hereunder except to the extent that the Indemnifying Party demonstrates that it
has been irreparably prejudiced thereby. If the Indemnifying Party notifies the
Indemnified Party that it does not dispute the claim or the amount of the claim
described in such Indemnity Notice or fails to notify the Indemnified Party
within the Dispute Period whether the Indemnifying Party disputes the claim or
the amount of the claim described in such Indemnity Notice, the amount of
Damages specified in the Indemnity Notice will be conclusively deemed a
liability of the Indemnifying Party under paragraph (a) of this Section and the
Indemnifying Party shall pay the amount of such Damages to the Indemnified Party
on demand. If the Indemnifying Party has timely disputed its liability or the
amount of its liability with respect to such claim, the Indemnifying Party and
the Indemnified Party shall proceed in good faith to negotiate a resolution of
such dispute; provided, however, that it the dispute is not resolved within
thirty (30) days after the Claim Notice, the Indemnifying Party shall be
entitled to institute such legal action as it deems appropriate. 

                                            c.                      The indemnity
agreements contained herein shall be in addition to (i) any cause of action or
similar rights of the indemnified party against the indemnifying party or
others, and (ii) any liabilities the indemnifying party may be subject to. 

                                            11.                    JURY TRIAL WAIVER. The
Company and the Purchaser hereby waive a trial by jury in any action, proceeding
or counterclaim brought by either of the Parties hereto against the other in
respect of any matter arising out or in connection with the Transaction
Documents. 


Page 18 




                                            12.                    GOVERNING LAW: MISCELLANEOUS. 

                                            a.                      (i)                      This Agreement
shall be governed by and interpreted in accordance with the laws of the State of
Nevada for contracts to be wholly performed in such state and without giving
effect to the principles thereof regarding the conflict of laws. Each of the
parties consents to the non-exclusive jurisdiction of the federal courts whose
districts encompass any part of the state courts of San Diego County, California
as in connection with any dispute arising under this Agreement or any of the
other Transaction Documents and hereby waives, to the maximum extent permitted
by law, any objection, including any objection based on forum non
conveniens, to the bringing of any such proceeding in such jurisdictions or
to any claim that such venue of the suit, action or proceeding is improper. To
the extent determined by such court, the Company shall reimburse the Purchaser
for any reasonable legal fees and disbursements incurred by the Purchaser in
enforcement of or protection of any of its rights under any of the Transaction
Documents. Nothing in this Section shall affect or limit any right to serve
process in any other manner permitted by law. THE PARTIES HEREBY IRREVOCABLY
WAIVE ANY RIGHT THEY MAY HAVE TO, AND AGREE NOT TO REUEST, A JURY TRIAL FOR THE
ADJUDICATION OF ANY DISPUTE HEREUNDER OR IN CONNECTION WITH OR ARISING OUT OF
THIS AGREEMENT OR ANY TRANSACTION CONTEMPLATED HEREBY.

                                            (ii)                     The Company and the
Purchaser acknowledge and agree that irreparable damage would occur in the event
that any of the provisions of this Agreement or the other Transaction Documents
were not performed in accordance with their specific terms or were otherwise
breached. It is accordingly agreed that the parties shall be entitled to an
injunction or injunctions to prevent or cure breaches of the provisions of this
Agreement and the other Transaction Documents and to enforce specifically the
terms and provisions hereof and thereof, this being in addition to any other
remedy to which any of them may be entitled by law or equity. 

                                            b.                      Failure of any party to
exercise any right or remedy under this Agreement or otherwise, or delay by a
party in exercising such right or remedy, shall not operate as a waiver thereof.


                                            c.                      This Agreement shall
inure to the benefit of and be binding upon the successors and assigns of each
of the parties hereto. 

                                            d.                      All pronouns and any
variations thereof refer to the masculine, feminine or neuter, singular or
plural, as the context may require. 

                                            e.                      A facsimile
transmission of this signed Agreement shall be legal and binding on all parties
hereto.

                                            f.                      This Agreement may be
signed in one or more counterparts, each of which shall be deemed an
original.

                                            g.                      The headings of this
Agreement are for convenience of reference and shall not form part of, or affect
the interpretation of, this Agreement.

                                            h.                      If any provision of
this Agreement shall be invalid or unenforceable in any jurisdiction, such
invalidity or unenforceability shall not affect the validity or enforceability
of the remainder of this Agreement or the validity or
enforceability of this Agreement in any other jurisdiction.

Page 19 




                                            i.                     This Agreement may be
amended only by an instrument in writing signed by the party to be charged with
enforcement thereof.

                                            j.                     This Agreement
supersedes all prior agreements and understandings among the parties hereto with
respect to the subject matter hereof. 

                                            13.                  NOTICES. Any
notice required or permitted hereunder shall be given in writing (unless
otherwise specified herein) and shall be deemed effectively given on the
earliest of

                                            (a)                   the date delivered, if
delivered by personal delivery as against written receipt therefor or by
confirmed facsimile transmission, 

                                            (b)                   the fifth Trading Day after
deposit, postage prepaid, in the United States Postal Service by registered or
certified mail, or

                                            (c)                   the third Trading Day after
mailing by domestic or international express courier, with delivery costs and
fees prepaid, in each case, addressed to each of the other parties thereunto
entitled at the following addresses (or at such other addresses as such party may designate by ten
  (10) days’ advance written notice similarly given to each of the other parties
hereto): 

	COMPANY: 	Lithium Exploration Group Inc. 
	  	3200 N Hayden Road, Suite 235 
	  	Scottsdale, AZ 85251 
	  	Attn: Alex Walsh 
	  	Telecopier No.: +1.480.641.4794 
	  	  
	PURCHASER: 	Vista Capital Investments, LLC 
	  	La Mesa, California 91941 
	  	Attn: David J. Clark, Principal 
	  	Telecopier No.: _______________________


                                          14.                  SURVIVAL OF REPRESENTATIONS AND WARRANTIES. The Company’s and the Purchaser’s representations and warranties
herein shall survive the execution and delivery of this Agreement and the
delivery of the Certificates and the payment of the Purchase Amount, and shall
inure to the benefit of the Purchaser and the Company and their respective
successors and assigns. 

[Balance of page intentionally left blank] 

Page 20 




                                            IN WITNESS WHEREOF, this
Agreement has been duly executed by the Purchaser and the Company as of the date
set first above written. 


	VISTA CAPITAL INVESTMENTS, LLC.
	 	 
	By: 	    
	Name: 	David J. Clark 
	Title: 	Principal 





	 
	 
	LITHIUM EXPLORATION GROUP, INC. 
	 
	By:
	
	Alexander Walsh 
	Chief Executive Officer 




Page 21 





	 	ANNEX I 	FORM OF NOTE 
	 	 	 
	 	ANNEX II 	FORM OF WARRANT 


Page 22