Document:

Lithium Exploration Group, Inc. - Exhibit 10.2 - Filed by newsfilecorp.com

SECURED CONVERTIBLE PROMISSORY NOTE 
$708,000
ORIGINAL ISSUE DISCOUNT 

THIS NOTE AND THE SHARES ISSUABLE UPON CONVERSION OF THIS NOTE
HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED. THIS NOTE
AND THE SHARES ISSUABLE UPON CONVERSION OF THIS NOTE MAY NOT BE SOLD, OFFERED
FOR SALE, PLEDGED OR HYPOTHECATED IN THE ABSENCE OF AN EFFECTIVE REGISTRATION
STATEMENT OR APPLICABLE EXEMPTION OR SAFE HARBOR PROVISION.

Issue Date: July 22, 2014 

FOR VALUE RECEIVED, Lithium Exploration Group, Inc. as
Obligor ("Borrower,” or “Obligor”), hereby promises to pay to JDF Capital Inc.,
(the “Lender” or “Holder”), the Principal Sum, as defined below, along with the
Interest Rate, as defined below, according to the terms herein. 

	
      The "Lender" shall be: 
	
      JDF Capital Inc. 

	
      The "Principal Sum" shall be: 
	
      $708,000 (six hundred seventy two thousand US Dollars)
      which amount includes $600,000 paid by the Lender and $108,000 in respect
      of prepaid interest at 8% per annum for 18 months. . 

	
      The “Consideration” shall be: 
	
      $600,000 (six hundred thousand US dollars) in the form of
      cash payment by wire or check as set forth in the attached funding
      schedule. 

	
      The "Interest Rate" shall be: 
	
      12% per annum, calculated monthly, in arrears. The
      Principal Sum is inclusive of prepaid interest at the Interest Rate for 18
      months. Interest shall continue to accrue on any portion of the Principal
      Sum outstanding from time to time following the Maturity Date. 

	
      The "Conversion Price" shall be the following price:
    
	
      the lower of 65% of the lowest reported sale price of the
      Borrower’s common stock (the “Common Stock”) for the 20 trading days
      immediately prior to (i) the closing date on July 22, 2014 (the “Closing
      Date”), or (ii) 65% of the lowest reported sale price for the 20 days
      prior the conversion date of the Note 

	
      The "Maturity Date" is the date upon which the Principal
      Sum of this Note, as well as any unpaid interest shall be due and payable,
      and that date shall be: 
	
      January 22, 2016. 

	
      The “Purchase Agreement”, which is incorporated herein by
      reference means the: 
	
      Securities Purchase Agreement between the Borrower and
      the Lender dated July 22, 2014 

	
      The “General Security Agreement” or “GSA”, which is
      incorporated herein by reference means the: 
	
      General Security Agreement between the Lender and Alta
      Disposal Ltd. (the ``Guarantor``) dated July 22, 2014.

ARTICLE 1 PAYMENT-RELATED PROVISIONS 

           
1.1 Principal Sum. The Principal Sum is $708,000 (six hundred seventy two
thousand) which includes$600,000 (six hundred thousand) payable to be advanced
by the Lender and $108,000 in prepaid interest at the Interest Rate for 18
months. The Lender shall pay $100,000 of Consideration upon closing of this Note
as the Purchase Price under the Purchase Agreement of even date herewith between
the Borrower and the Lender. As set forth in the attached Funding Schedule, the
Lender shall pay an additional $500,000 of Consideration to the Borrower in such
amounts and times as specified in the Funding Schedule.

_________

           
1.2 Events of Default. The occurrence of any of the following events
shall be an “Event of Default” or “Default” under this Note: 

            (a)       
the Borrower shall fail to make the payment of any amount of principal
outstanding on the date such payment is due hereunder; 

           
(b)        the Borrower shall fail to make
any payment of interest in shares of Common Stock for a period of three (3) days
after the date such interest is due; 

           
(c)        the suspension from listing,
without subsequent listing on any one of, or the failure of the Common Stock to
be listed on at least one of the OTC Bulletin Board, Nasdaq SmallCap Market,
Nasdaq National Market, American Stock Exchange or The New York Stock Exchange,
Inc. for a period of five (5) consecutive Trading Days; 

           
(d)        the Borrower’s notice to the
Lender, including by way of public announcement, at any time, of its inability
to comply or its intention not to comply with proper requests for conversion of
this Note into shares of Common Stock; 

           
(e)        the Borrower shall fail to (i)
timely deliver the shares of Common Stock upon conversion of the Note or any
accrued and unpaid interest, or (ii) make the payment of any fees and/or
liquidated damages under this Note or the Purchase Agreement, which failure in
the case of items (i) and (ii) of this Section 1.2 (e) is not remedied within
three (3) business days after the incurrence thereof; 

           
(f)        default shall be made in the
performance or observance of (i) any material covenant, condition or agreement
contained in this Note (other than as set forth in clause (e) of this Section
1.2) and such default is not fully cured within five (5) business days after the
occurrence thereof; (ii) any material covenant, condition or agreement contained
in the Purchase Agreement any other Transaction Document which is not covered by
any other provisions of this Section 1.2 and such default is not fully cured
within five (5) business days after the occurrence thereof; or (iii) any
covenant, condition or agreement contained in the GSA (without allowance for
cure of such default); 

           
(g)        any material representation or
warranty made by the Borrower herein or in the Purchase Agreement or any other
Transaction Document, or by the Guarantor in the GSA, shall prove to have been
false or incorrect or breached in a material respect on the date as of which
made; 

           
(h)        the Borrower shall (A) default in
any payment of any amount or amounts of principal of or interest on any
indebtedness (other than the indebtedness hereunder) the aggregate principal
amount of which indebtedness is in excess of $100,000 or (B) default in
the observance or performance of any other agreement or condition relating to
any indebtedness or contained in any instrument or agreement evidencing,
securing or relating thereto, or any other event shall occur or condition exist,
the effect of which default or other event or condition is to cause, or to
permit the holder or holders or beneficiary or beneficiaries of such indebtedness to cause with the giving of
notice if required, such indebtedness to become due prior to its stated
maturity; 

           
(i)        the Borrower shall (i) apply for
or consent to the appointment of, or the taking of possession by, a receiver,
custodian, trustee or liquidator of itself or of all or a substantial part of
its property or assets, (ii) make a general assignment for the benefit of its
creditors, (iii) commence a voluntary case under the United States Bankruptcy
Code (as now or hereafter in effect) or under the comparable laws of any
jurisdiction (foreign or domestic), (iv) file a petition seeking to take
advantage of any bankruptcy, insolvency, moratorium, reorganization or other
similar law affecting the enforcement of creditors’ rights generally, (v)
acquiesce in writing to any petition filed against it in an involuntary case
under United States Bankruptcy Code (as now or hereafter in effect) or under the
comparable laws of any jurisdiction (foreign or domestic), (vi) issue a notice
of bankruptcy or winding down of its operations or issue a press release
regarding same, or (vii) take any action under the laws of any jurisdiction
(foreign or domestic) analogous to any of the foregoing; 

           
(j)        a proceeding or case shall be
commenced in respect of the Borrower, without its application or consent, in any
court of competent jurisdiction, seeking (i) the liquidation, reorganization,
moratorium, dissolution, winding up, or composition or readjustment of its
debts, (ii) the appointment of a trustee, receiver, custodian, liquidator or the
like of it or of all or any substantial part of its assets in connection with
the liquidation or dissolution of the Borrower or (iii) similar relief in
respect of it under any law providing for the relief of debtors, and such
proceeding or case described in clause (i), (ii) or (iii) shall continue
undismissed, or unstayed and in effect, for a period of sixty (60) days or any
order for relief shall be entered in an involuntary case under United States
Bankruptcy Code (as now or hereafter in effect) or under the comparable laws of
any jurisdiction (foreign or domestic) against the Borrower or action under the
laws of any jurisdiction (foreign or domestic) analogous to any of the foregoing
shall be taken with respect to the Borrower and shall continue undismissed, or
unstayed and in effect for a period of sixty (60) days; or 

           
(k)        the failure of the Borrower to
instruct its transfer agent to remove any legends from shares of Common Stock
eligible to be sold under Rule 144 of the Securities Act and issue such
unlegended certificates to the Holder within five (5) business days of the
Holder’s request so long as the Holder has provided reasonable assurances and
opinions of counsel to the Borrower that such shares of Common Stock can be
resold pursuant to Rule 144; or 

           
(l)        the failure of the Borrower to pay
any amounts due to the Holder herein within three (3) business days of receipt
of notice to the Company. 

1.3        Consequences of
Default/Remedies. In the event of any Event of Default, as defined in above
section 1.2, the outstanding principal amount of this Note, plus accrued but
unpaid interest, liquidated damages, fees and other amounts owing in respect
thereof through the date of acceleration, shall become, at the Holder’s
election, immediately due and payable in cash at the Mandatory Default Amount.
Commencing five (5) days after the occurrence of any Event of Default that
results in the eventual acceleration of this Note, the interest rate on this
Note shall accrue at an interest rate equal to the lesser of 18% per annum or
the maximum rate permitted under applicable law. In connection with such
acceleration described herein, the Holder need not provide, and the Borrower
hereby waives, any presentment, demand, protest or other notice of any kind, and
the Holder may immediately and without expiration of any grace period enforce
any and all of its rights and remedies hereunder and all other remedies
available to it under applicable law. Such acceleration may be rescinded and
annulled by Holder at any time prior to payment hereunder and the Holder shall
have all rights as a holder of the note until such time, if any, as the Holder
receives full payment pursuant to this Section 1.2. No such rescission or annulment shall affect any subsequent Event of Default or
impair any right consequent thereon. The Mandatory Default Amount means the
greater of (i) the outstanding principal amount of this Note, plus all accrued
and unpaid interest, liquidated damages, fees and other amounts hereon, divided
by the Conversion Price on the date the Mandatory Default Amount is either
demanded or paid in full, whichever has a lower Conversion Price, multiplied by
the VWAP on the date the Mandatory Default Amount is either demanded or paid in
full, whichever has a higher VWAP, or (ii) 130% of the outstanding principal
amount of this Note, plus 100% of accrued and unpaid interest, liquidated
damages, fees and other amounts hereon. 

           
1.4 Redemption. During the first 18 months this Note is in effect, the Borrower
may redeem this Note by paying to the Holder an amount as follows: (i) if the
redemption is within the first 60 days after the Issue Date of this Note, then
for an amount equal to 110% of the unpaid Principal Sum of this Note, (ii) if
the redemption is on or after the 61st day after the Issue Date of this Note,
but prior to the 121st day after the Issue Date of this Note, then for an amount
equal to 120% of the unpaid Principal Sum of this Note, and (iii) if the
redemption is after the 121st day after the Issue Date of this Note, but prior
to the Maturity Date of this Note, then for an amount equal to 130% of the
unpaid Principal Sum. This Note may not be redeemed on or after the Maturity
Date. The redemption must be closed and paid for within 10 business days of the
Company sending the redemption demand or the redemption will be invalid. 

           
1.5 Security. To secure the due payment of the Principal Sum and Interest
payable under this Note, the Borrower shall cause to be provided to the Holder
contemporaneously with the advance of the Principal Sum, the general security
agreement annexed hereto as Exhibit A granting the Holder a security interest in
all of the present and after acquired personal property (the “Security”)
of Alta Disposal Ltd. The Borrower further agrees that it will not transfer,
assign, pledge or provide a negative pledge to any third party with respect to
the Security while the Note is outstanding.

ARTICLE 2 CONVERSION RIGHTS 

           
The Holder will have the right to convert the Principal Sum (including OID,
interest, and other fees) under this Note into Shares of the Borrower's Common
Stock as set forth below. 

           
2.1 Conversion Rights and Cashless Exercise. The Holder will have the right at
its election from and after the Issue Date, and then at any time, to convert all
or part of the outstanding and unpaid Principal Sum and accrued interest into
shares of fully paid and nonassessable shares of common stock of Lithium
Exploration Group, Inc. (as such stock exists on the date of issuance of this
Note, or any shares of capital stock of Lithium Exploration Group, Inc. into
which such stock is hereafter changed or reclassified, the "Common Stock") as
per the Conversion Formula set forth in Section 2.2. Any such conversion shall
be cashless, and shall not require further payment from Holder. Unless otherwise
agreed in writing by both the Borrower and the Holder, at no time will the
Holder convert any amount of the Note into common stock that would result in the
Holder owning more than 4.99% of the common stock outstanding of Lithium
Exploration Group, Inc., as calculated in accordance with sections 13(d) and
13(g) of the Securities Exchange Act of 1934, as amended (the “Exchange Act’)
Shares from any such conversion will be delivered to Holder (in any name
directed by Holder) by 2:30pm EST within 3 (three) business days of conversion
notice delivery (see 3.1) by “DWAC/FAST” electronic transfer. 

           
2.2. Conversion Formula. The number of shares issued through conversion is the
conversion amount divided by the conversion price, as illustrated below. The
Holder and the Borrower shall maintain records showing the principal amount(s)
converted and the date of such conversion(s). If no objection is delivered from
Borrower to Holder regarding any variable or calculation of the conversion
notice within 24 (twenty-four) hours of delivery of the conversion notice, the
Borrower shall have been thereafter deemed to have irrevocably confirmed and
irrevocably ratified such Notice of Conversion and waive any objection thereto.
The Company acknowledges and agrees that, absent a duly delivered objection
notice as required above, the Holder shall materially rely on the confirmation
and ratification of the conversion price and, notwithstanding subsequent
information to the contrary that such computation was made in error, such deemed
conversion price shall thereafter be the conversion price for purposes of such
conversion. 

# Shares = Conversion
Amount 
                       
Conversion Price 

           
2.5 Reservation of Shares. As of the issuance date of this Note and for the
remaining period during which the conversion right exists, the Borrower will
reserve from its authorized and unissued Common Stock a sufficient number of
shares to provide for the issuance of Common Stock upon the full conversion of
this Note. The Borrower represents that upon issuance, such shares will be duly
and validly issued, fully paid and non-assessable. The Borrower agrees that its
issuance of this Note constitutes full authority to its officers, agents and
transfer agents who are charged with the duty of executing and issuing shares to
execute and issue the necessary shares of Common Stock upon the conversion of
this Note.

           
2.6. Delivery of Conversion Shares. Shares from any such conversion will be
delivered to Holder by 2:30pm EST within 3 (three) business days of conversion
notice delivery (see 3.1) by “DWAC/FAST” electronic transfer (such date, the
“Share Delivery Date”). For example, if Holder delivers a conversion notice to
Borrower at 5:15 pm eastern time on Monday January 1st, Borrower’s
transfer agent must deliver shares to Holder’s broker via “DWAC/FAST” electronic
transfer by no later than 2:30 pm eastern time on Thursday January 4th. If those
shares are not delivered in accordance with this timeframe stated in this
Section 2.6, Holder, at any time prior to selling those shares (in whole or in
part), may rescind that particular conversion (in whole or in part) and have the
conversion amount (in whole or in part) returned to the note balance with the
conversion shares (in whole or in part) returned to the Borrower (under Holder
and Borrower’s expectation that any returned conversion amounts will tack back
to the original date of the note). The Company will make its best efforts
to deliver shares to Holder same day / next day. 

2.6.1 Nothing herein shall limit a
Holder’s right to pursue any other remedies available to it hereunder (including
election to pursue its rights under this Section 2.6 and subsections), at law or
in equity including, without limitation, a decree of specific performance and/or
injunctive relief with respect to the Borrower’s failure to timely deliver
shares of Common Stock upon conversion of the Note as required pursuant to the
terms hereof. 

2.6.2 Conversion Delay Penalties.
Holder may assess, at its election, penalties or liquidated damages (both
referred to herein as “penalties”) as follows. 

2.6.2. A. For each conversion,
Borrower agrees to deliver share issuance instructions to its transfer agent
same day or next day. In the event that the share issuance instructions are not
delivered to the Borrower’s transfer agent by the next day, a penalty of $2,000
per day will be assessed for each day until share issuance instructions are
delivered to the transfer agent ($2,000 per day inclusive of the day of
conversion); and such penalty will be added to the principal balance of the Note
(under Holder and Borrower’s expectation that any penalty amounts will tack back
to the original date of the note). 

2.6.2. B. For each conversion, in the
event that shares are not delivered by the third business day (inclusive of the
day of conversion), a penalty of $2,000 per day will be assessed for each day
after the third business day (inclusive of the day of the conversion) until
share delivery is made; and such penalty will be added to the principal balance
of the Note (under Holder and Borrower’s expectation that any penalty amounts
will tack back to the original date of the note). Borrower will not be
subjected to any penalties once its transfer agent processes the shares to the
DWAC system. 

2.6.3 If failure to deliver Conversion
Shares occurs as follows, Holder may elect to enforce one or more of these
remedies at its sole election. 

2.6.3. A. In addition to any other
rights available to the Holder, if the Borrower fails to cause its transfer
agent to transmit to the Holder the shares on or before the Share Delivery Date,
and if after such date the Holder is required by its broker to purchase (in an
open market transaction or otherwise) or if the Holder’s brokerage firm
otherwise purchases, shares of Common Stock to deliver in satisfaction of a sale
by the Holder of the shares which the Holder anticipated receiving upon such
conversion (a “Buy-In”), then the Borrower shall (A) pay in cash to the
Holder the amount, if any, by which (x) the Holder’s total purchase price
(including brokerage commissions and other fees, if any) for the shares of
Common Stock so purchased exceeds (y) the amount obtained by multiplying (1) the
number of Shares that the Borrower was required to deliver to the Holder in
connection with the conversion at issue times (2) the price at which the sell
order giving rise to such purchase obligation was executed, and (B) at the
option of the Holder, either (x) reinstate the portion of the Note and
equivalent number of shares for which such conversion was not honored (in which
case such conversion shall be deemed rescinded), (y) deliver to the Holder the
number of shares of Common Stock that would have been issued had the Borrower
timely complied with its conversion and delivery obligations hereunder, or (z)
pay in cash to the Holder the amount obtained by multiplying (1) the number of
Shares that the Borrower was required to deliver to the Holder in connection
with the conversion at issue times (2) the price at which the sell order giving
rise to such purchase obligation was executed. The Holder shall provide the
Borrower written notice indicating the amounts payable to the Holder in respect
of the Buy-In and, upon request of the Borrower, evidence of the amount of such
loss. 

2.6.3. B. If the Borrower fails for
any reason to deliver to the Holder the Shares by DWAC/FAST electronic transfer
(such as by delivering a physical stock certificate) and if the Holder incurs
a Market Price Loss, then at any time subsequent to incurring the loss the
Holder may provide the Borrower written notice indicating the amounts payable to
the Holder in respect of the Market Price Loss and the Borrower must make the
Holder whole by either of the following options at Holder’s election: 

Market Price Loss = [(VWAP on the day
of conversion) x (Number of shares receivable from the conversion)] – [(Sales
price realized by Holder) x (Number of shares receivable from the conversion)]. 

Option A – Pay Market Price Loss in
Cash. The Borrower must pay the Market Price Loss by cash payment, and any such
cash payment must be made by the third business day from the time of the
Holder’s written notice to the Borrower. 

Option B – Add Market Price Loss to
Principal Sum. The Borrower must pay the Market Price Loss by adding the Market
Price Loss to the balance of the Principal Sum (under Holder’s and the
Borrower’s expectation that any Market Price Loss amounts will tack back to the
original date of issue of this Note). 

2.6.3. C. If the Borrower fails for
any reason to deliver to the Holder the Shares within 2 (two) business days of
the Share Delivery Date and if the Holder incurs a Failure to Deliver Loss, then
at any time subsequent to incurring the loss the Holder may provide the Borrower
written notice indicating the amounts payable to the Holder in respect of the
Failure to Deliver Loss and the Borrower must make the Holder whole as follows:

Failure to Deliver Loss = [(High trade
price at any time on or after the day of conversion) x (Number of shares
receivable from the conversion)]. 

The Borrower must pay the Failure to
Deliver Loss by cash payment, and any such cash payment must be made by the
third business day from the time of the Holder’s written notice to the Borrower.

           
2.7. This section 2.7 intentionally left blank. 

ARTICLE 3 MISCELLANEOUS

           
3.1. Notices. Any notice required or permitted hereunder must be in writing and
either personally served, sent by facsimile or email transmission, or sent by
overnight courier. Notices will be deemed effectively delivered at the time of
transmission if by facsimile or email, and if by overnight courier the business
day after such notice is deposited with the courier service for delivery. 

           
3.2 Subsequent Equity Sales or Agreements. The Borrower shall provide the
Holder, whenever the Holder requests at any time while this Note is outstanding,
a schedule of all issuances of Common Stock or any debt, preferred stock, right,
option, warrant or other instrument that is convertible into or exercisable or
exchangeable for, or otherwise entitles the holder thereof to receive, Common
Stock (a “Common Stock Equivalent”) since the date of issuance of this Note,
including the applicable issuance price, or applicable reset price, exchange price, conversion price, exercise price and other pricing
terms. The term issuances shall also include all agreements to issue, or
prospectively issue Common Stock or Common Stock Equivalents, regardless of
whether the issuance contemplated by such agreement is consummated. The Borrower
shall notify the Holder in writing of any issuances within twenty-four (24)
hours of such issuance.

           
3.3. Amendment Provision. The term "Note" and all reference thereto, as used
throughout this instrument, means this instrument as originally executed, or if
later amended or supplemented, then as so amended or supplemented.

           
3.4. Assignability. The Borrower may not assign this Note. This Note will be
binding upon the Borrower and its successors, and will inure to the benefit of
the Holder and its successors and assigns, and may be assigned by the Holder to
anyone of its choosing without Borrower’s approval. 

            3.5.
Governing Law. This Note will be governed by, and construed and enforced in
accordance with, the laws of the State of Nevada, without regard to the conflict
of laws principles thereof. Each of the Borrower and the Holder (i) hereby
submits to the exclusive jurisdiction of the state and federal courts of Nevada
for the purposes of any suit, action or proceeding arising out of or relating to
this Note and (ii) hereby waives, and agrees not to assert in any such suit,
action or proceeding, any claim that it is not personally subject to the
jurisdiction of such court, that the suit, action or proceeding is brought in an
inconvenient forum or that the venue of the suit, action or proceeding is
improper. Each of the Borrower and the Holder consents to process being served
in any such suit, action or proceeding by mailing a copy thereof to such party
at the address in effect for notices to it under the Purchase Agreement and
agrees that such service shall constitute good and sufficient service of process
and notice thereof. Nothing in this Section 3.5 shall affect or limit any right
to serve process in any other manner permitted by law.

            3.6.
Delivery of Process by Holder To Borrower. In the event of any action or
proceeding by Holder against Borrower, and only by Holder against Borrower,
service of copies of summons and/or complaint and/or any other process which may
be served in any such action or proceeding may be made by Holder via overnight
delivery service such as FedEx or UPS, process server, or by personal delivery
of a copy of such process to the Borrower at its last known address or to its
last known attorney set forth in its most recent SEC filing. 

            3.7.
No Rights as Stockholder Until Conversion. This Note does not entitle the Holder
to any voting rights, dividends or other rights as a stockholder of the Company
prior to the conversion hereof as set forth in Section 2.1. So long as this Note
is unconverted, this Note carries no voting rights and does not convey to the
Holder any “control” over the Company, as such term may be interpreted by the
SEC under the Securities Act or the Exchange Act, regardless of whether this
Note is currently convertible. 

            3.8.
Maximum Payments. Nothing contained herein may be deemed to establish or require
the payment of a rate of interest or other charges in excess of the maximum
permitted by applicable law. In the event that the rate of interest required to
be paid or other charges hereunder exceed the maximum permitted by such law, any
payments in excess of such maximum will be credited against amounts owed by the
Borrower to the Holder and thus refunded to the Borrower.

            3.9.
Attorney Fees. In the event any attorney is employed by either party to this
Note with regard to any legal or equitable action, arbitration or other
proceeding brought by such party for the enforcement of this Note or because of
an alleged dispute, breach, default or misrepresentation in connection with any
of the provisions of this Note, the prevailing party in such proceeding will be
entitled to recover from the other party reasonable attorneys' fees and other
costs and expenses incurred, in addition to any other relief to which the
prevailing party may be entitled. 

            3.10.
Nonwaiver. No course of dealing or any delay or failure to exercise any right
hereunder on the part of Holder shall operate as a waiver of such right or
otherwise prejudice the Holder’s rights, powers or remedies. 

            3.11.
No Public Announcement. Except as required by securities law, no public
announcement may be made regarding this Note, payments, or conversions without
written permission by both Borrower and Holder. 

            3.12.
Opinion of Counsel. In the event that an opinion of counsel is needed for any
matter related to this Note, Holder has the right to have any such opinion
provided by its counsel. Holder also has the right to have any such opinion
provided by Borrower’s counsel. 

            3.13.
Director’s Resolution. Once effective, Borrower will execute and deliver to
Holder a copy of a Board of Director’s resolution resolving that this note is
validly issued, paid, and effective. 

      
     3.14. No Shorting. Holder agrees that so long as
any Note from Borrower to Holder remains outstanding, Holder will not enter into
or effect any “short sales” of the common stock or hedging transaction which
establishes a net short position with respect to the common stock of Lithium
Exploration Group, Inc. Borrower acknowledges and agrees that upon submission of
conversion notice as set forth in Section 3.1 (up to the amount of cash paid in
under the Note), Holder immediately owns the common shares described in the
conversion notice and any sale of those shares issuable under such conversion
notice would not be considered short sales. 

 

BORROWER: 

LITHIUM EXPLORATION GROUP, INC. 

	By: 	/s/ Alexander Walsh 	 
	 	Alexander Walsh 	 
	 	President 	 

 

LENDER/HOLDER: 

JDF CAPITAL INC. 

	By: 	/s/ John Fierro 	 
	 	John Fierro 	 
	 	President 	 

[Secured Convertible Promissory Note Signature Page] 

FUNDING SCHEDULE 

 

	$100,000 paid to Borrower upon the Closing Date;
  
	$100,000 paid to Borrower on August 22, 2014;
  
	$100,000 paid to Borrower on September 22, 2014;
  
	$100,000 paid to Borrower on October 22, 2014;
  
	$100,000 paid to Borrower on November 22, 2014; and
  
	$100,000 paid to Borrower on December 22, 2014.Lithium Exploration Group, Inc. - Exhibit 10.3 - Filed by newsfilecorp.com

THIS WARRANT AND THE SHARES ISSUABLE UPON EXERCISE OF THIS
WARRANT HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED.
THIS WARRANT AND THE SHARES ISSUABLE UPON EXERCISE OF THIS WARRANT MAY NOT BE
SOLD, OFFERED FOR SALE, PLEDGED OR HYPOTHECATED IN THE ABSENCE OF AN EFFECTIVE
REGISTRATION STATEMENT OR APPLICABLE EXEMPTION OR SAFE HARBOR PROVISION. 

COMMON STOCK PURCHASE WARRANT 

LITHIUM EXPLORATION GROUP, INC. 

	Warrant Shares: 17,700,000 	Initial Issue Date: July 22, 2014 
	Aggregate Exercise Amount: $708,000 	  

                          THIS
COMMON STOCK PURCHASE WARRANT (the “Warrant”) certifies that, for value
received, JDF Capital Inc., or its assigns (the “Holder”) is entitled,
upon the terms and subject to the limitations on exercise and the conditions
hereinafter set forth, at any time on or after the date hereof (the “Initial
Exercise Date”) and on or prior to the close of business on the five (5)
year anniversary of the Initial Exercise Date (as subject to adjustment
hereunder, the “Termination Date”), to subscribe for and purchase from
Lithium Exploration Group, Inc., a Nevada corporation (the “Company”), up
to 17,700,000 shares (as subject to adjustment herein, the “Warrant
Shares”) of common stock of the Company (the “Common Stock”). The
purchase price of one share of Common Stock under this Warrant shall be equal to
the Exercise Price, as defined in Section 1.2.

ARTICLE 1 EXERCISE RIGHTS 

            The
Holder will have the right to exercise this Warrant to purchase shares of Common
Stock as set forth below. Capitalized terms used and not otherwise defined
herein shall have the meanings set forth in that certain Securities Purchase
Agreement Document dated July 22, 2014 between the Company and the Holder (the
“Agreement”). 

            1.1       
Exercise of Warrant. Exercise of the purchase rights represented by this
Warrant may be made, in whole or in part, from and after the Initial Exercise
Date, and then at any time, by delivery to the Company (or such other office or
agency of the Company as it may designate by notice in writing to the registered
Holder at the address of the Holder appearing on the books of the Company) of a
duly executed facsimile or emailed copy of the Notice of Exercise form annexed
hereto. Within three (3) business days following the date of exercise as
aforesaid, the Holder shall deliver the aggregate Exercise Price for the shares
specified in the applicable Notice of Exercise by wire transfer or check drawn
on a United States bank unless the cashless exercise procedure specified in
Section 1.3 below is specified in the applicable Notice of Exercise. Partial
exercises of this Warrant resulting in purchases of a portion of the total
number of Warrant Shares available hereunder shall have the effect of lowering
the outstanding number of Warrant Shares purchasable hereunder in an amount
equal to the applicable number of Warrant Shares purchased. The Holder and the
Company shall maintain records showing the number of Warrant Shares purchased
and the date of such purchases. The Company shall deliver any objection to any
Notice of Exercise form within 24 hours of receipt of such notice. The Holder
and any assignee, by acceptance of this Warrant, acknowledge and agree that, by
reason of the provisions of this paragraph, following the purchase of a portion
of the Warrant Shares hereunder, the number of Warrant Shares available for
purchase hereunder at any given time may be less than the amount stated on the
face hereof. 

            1.2       
Exercise Price. The exercise price per share of Common Stock under this
Warrant shall be $0.04 per share, subject to adjustment hereunder (the
“Exercise Price”). The aggregate exercise price is $708,000. 

1 

            1.3        Cashless Exercise. If at any time after the earlier of (i) the six (6)
month anniversary of the date of the Agreement and (ii) the completion of the
then-applicable holding period required by Rule 144, or any successor provision
then in effect, there is no effective Registration Statement registering, or no
current prospectus available for, the resale of the Warrant Shares by the
Holder, then this Warrant may also be exercised, in whole or in part, at such time by means of a “cashless exercise” in which the Holder
shall be entitled to receive a number of Warrant Shares equal to the quotient
obtained by dividing [(A-B) (X)] by (A), where: 

		(A) = 	
      the VWAP on the trading day immediately preceding the
      date on which Holder elects to exercise this Warrant by means of a
      “cashless exercise,” as set forth in the applicable Notice of Exercise;
      

	 	 	     
	 	(B) =	
      the Exercise Price of this Warrant, as adjusted
      hereunder; and 

	 	 	     
		(X) = 	
      the number of Warrant Shares that would be issuable upon
      exercise of this Warrant in accordance with the terms of this Warrant if
      such exercise were by means of a cash exercise rather than a cashless
      exercise. 

            1.4       
Delivery of Warrant Shares. Warrant Shares purchased hereunder will be
delivered to Holder by 2:30 pm EST within two (2) business days of Notice of
Exercise by “DWAC/FAST” electronic transfer (such date, the “Warrant Share
Delivery Date”). For example, if Holder delivers a Notice of Exercise to the
Company at 5:15 pm eastern time on Monday January 1st, the Company’s
transfer agent must deliver shares to Holder’s broker via “DWAC/FAST” electronic
transfer by no later than 2:30 pm eastern time on Wednesday January
3rd. The Warrant Shares shall be deemed to have been issued, and
Holder or any other person so designated to be named therein shall be deemed to
have become a holder of record of such shares for all purposes, as of the date
of delivery of the Notice of Exercise. Holder may assess penalties or liquidated
damages (both referred to herein as “penalties”) as follows. For each exercise,
in the event that shares are not delivered by the third business day (inclusive
of the day of exercise), the Company shall pay the Holder in cash a penalty of
$2,000 per day for each day after the third business day (inclusive of the day
of exercise) until share delivery is made. The Company will not be subject to
any penalties once its transfer agent correctly processes the shares to the DWAC
system. The Company will make its best efforts to deliver the Warrant Shares
to the Holder the same day or next day. 

            1.5       
Delivery of Warrant. The Holder shall not be required to physically
surrender this Warrant to the Company. If the Holder has purchased all of the
Warrant Shares available hereunder and the Warrant has been exercised in full,
this Warrant shall automatically be cancelled without the need to surrender the
Warrant to the Company for cancellation. If this Warrant shall have been
exercised in part, the Company shall, at the request of Holder and upon
surrender of this Warrant, at the time of delivery of the Warrant Shares,
deliver to the Holder a new Warrant evidencing the rights of the Holder to
purchase the unpurchased Warrant Shares called for by this Warrant, which new
Warrant shall in all other respects be identical with this Warrant and, for
purposes of Rule 144, shall tack back to the original date of this Warrant. 

            1.6       
Warrant Exercise Rescission Rights. For any reason in Holder’s sole
discretion, including if the Warrant Shares are not delivered by DWAC/FAST
electronic transfer or in accordance with the timeframe stated in Section 1.4,
or for any other reason, Holder may, at any time prior to selling those Warrant
Shares rescind such exercise, in whole or in part, in which case the Company
must, within three (3) days of receipt of notice from the Holder, repay to the
Holder the portion of the exercise price so rescinded and reinstate the portion
of the Warrant and equivalent number of Warrant Shares for which the exercise
was rescinded and, for purposes of Rule 144, such reinstated portion of the
Warrant and the Warrant Shares shall tack back to the original date of this
Warrant. If Warrant Shares were issued to Holder prior to Holder’s rescission
notice, upon return of payment from the Company, Holder will, within three (3)
days of receipt of payment, commence procedures to return the Warrant Shares to
the Company. 

            1.7       
Compensation for Buy-In on Failure to Timely Deliver Certificates Upon
Exercise. In addition to any other rights available to the Holder, if the
Company fails to cause its transfer agent to transmit to the Holder the Warrant
Shares on or before the Warrant Share Delivery Date, and if after such date the
Holder is required by its broker to purchase (in an open market transaction or
otherwise) or the Holder’s brokerage firm otherwise purchases, shares of Common
Stock to deliver in satisfaction of a sale by the Holder of the Warrant Shares
which the Holder anticipated receiving upon such exercise (a “Buy-In”),
then the Company shall (A) pay in cash to the Holder the amount, if any, by
which (x) the Holder’s total purchase price (including brokerage commissions and
other fees, if any) for the shares of Common Stock so purchased exceeds (y) the
amount obtained by multiplying (1) the number of Warrant Shares that the Company
was required to deliver to the Holder in connection with the exercise at issue
times (2) the price at which the sell order giving rise to such
purchase obligation was executed, and (B) at the option of the Holder, either
(x) reinstate the portion of the Warrant and equivalent number of Warrant Shares
for which such exercise was not honored (in which case such exercise shall be
deemed rescinded), (y) deliver to the Holder the number of shares of Common
Stock that would have been issued had the Company timely complied with its
exercise and delivery obligations hereunder, or (z) pay in cash to the Holder
the amount obtained by multiplying (1) the number of Warrant Shares that the
Company was required to deliver to the Holder in connection with the exercise at
issue times (2) the price at which the sell order giving rise to such purchase
obligation was executed. The Holder shall provide the Company written notice
indicating the amounts payable to the Holder in respect of the Buy-In and, upon
request of the Company, evidence of the amount of such loss. 

2 

            1.8       
Make-Whole for Market Loss after Exercise. At the Holder’s election, if
the Company fails for any reason to deliver to the Holder the Warrant Shares by
DWAC/FAST electronic transfer (such as by delivering a physical certificate) and
if the Holder incurs a Market Price Loss, then at any time subsequent to
incurring the loss the Holder may provide the Company written notice indicating
the amounts payable to the Holder in respect of the Market Price Loss and the
Company must make the Holder whole as follows: 

Market Price Loss = [(High trade price
on the day of exercise) x (Number of Warrant Shares)] – [(Sales price realized
by Holder) x (Number of Warrant Shares)] 

The Company must pay the Market Price
Loss by cash payment, and any such cash payment must be made by the third
business day from the time of the Holder’s written notice to the Company. 

            1.9       
Make-Whole for Failure to Deliver Loss. At the Holder’s election, if the
Company fails for any reason to deliver to the Holder the Warrant Shares by the
Warrant Share Delivery Date and if the Holder incurs a Failure to Deliver Loss,
then at any time the Holder may provide the Company written notice indicating
the amounts payable to the Holder in respect of the Failure to Deliver Loss and
the Company must make the Holder whole as follows: 

Failure to Deliver Loss = [(High trade
price at any time on or after the day of exercise) x (Number of Warrant Shares)]

The Company must pay the Failure to
Deliver Loss by cash payment, and any such cash payment must be made by the
third business day from the time of the Holder’s written notice to the Company.

            1.10       
Choice of Remedies. Nothing herein, including, but not limited to,
Holder’s electing to pursue its rights under Sections 1.8 or 1.9 of this
Warrant, shall limit a Holder’s right to pursue any other remedies available to
it hereunder, at law or in equity including, without limitation, a decree of
specific performance and/or injunctive relief with respect to the Company’s
failure to timely deliver shares of Common Stock upon exercise of the Warrant as
required pursuant to the terms hereof. 

            1.11       
Charges, Taxes and Expenses. Issuance of Warrant Shares shall be made
without charge to the Holder for any issue or transfer tax or other incidental
expense in respect of the issuance of such shares, all of which taxes and
expenses shall be paid by the Company, and such Warrant Shares shall be issued
in the name of the Holder or in such name or names as may be directed by the
Holder. The Company shall pay all transfer agent fees required for same-day
processing of any Notice of Exercise. 

            1.12       
Holder’s Exercise Limitations. Unless otherwise agreed in writing by both
the Company and the Holder, at no time will the Holder exercise any amount of
this Warrant to purchase Common Stock that would result in the Holder owning
more than 4.99% of the Common Stock outstanding of the Company (the
“Beneficial Ownership Limitation”). Upon the written or oral
request of Holder, the Company shall within twenty-four (24) hours confirm
orally and in writing to the Holder the number of shares of Common Stock then
outstanding. 

3 

ARTICLE 2 ADJUSTMENTS 

            2.1       
Stock Dividends and Splits. If the Company, at any time while this
Warrant is outstanding: (i) pays a stock dividend or otherwise makes a
distribution or distributions on shares of its Common Stock or any other equity
or equity equivalent securities payable in shares of Common Stock (which, for
avoidance of doubt, shall not include any shares of Common Stock issued by the
Company upon exercise of this Warrant), (ii) subdivides outstanding shares of
Common Stock into a larger number of shares, (iii) combines (including by way of
reverse stock split) outstanding shares of Common Stock into a smaller number of
shares or (iv) issues by reclassification of shares of the Common Stock any
shares of capital stock of the Company, then in each case the Exercise Price
shall be multiplied by a fraction of which the numerator shall be the number of
shares of Common Stock (excluding treasury shares, if any) outstanding
immediately before such event and of which the denominator shall be the number
of shares of Common Stock outstanding immediately after such event, and the
number of shares issuable upon exercise of this Warrant shall be proportionately
adjusted such that the aggregate Exercise Price of this Warrant shall remain
unchanged. Any adjustment made pursuant to this Section 2.1 shall become
effective immediately after the record date for the determination of
stockholders entitled to receive such dividend or distribution and shall become
effective immediately after the effective date in the case of a subdivision,
combination or re-classification. 

            2.2       
Subsequent Equity Sales. If the Company or any Subsidiary thereof, as
applicable, at any time while this Warrant is outstanding, shall sell or grant
any option to purchase, or sell or grant any right to reprice, or otherwise
dispose of or issue (or announce any offer, sale, grant or any option to
purchase or other disposition) any Common Stock or any security entitling the
holder thereof (including sales or grants to the Holder) to acquire Common
Stock, including, without limitation, any debt, preferred stock, right, option,
warrant or other instrument that is convertible into or exercisable or
exchangeable for, or otherwise entitles the holder thereof to receive, Common
Stock (a “Common Stock Equivalent”), at an effective price per share less
than the Exercise Price then in effect (such lower price, the “Base Share
Price” and such issuances collectively, a “Dilutive Issuance”) (it
being understood and agreed that if the holder of the Common Stock or Common
Stock Equivalents so issued shall at any time, whether by operation of purchase
price adjustments, reset provisions, floating conversion, exercise or exchange
prices or otherwise, or due to warrants, options or rights per share which are
issued in connection with such issuance, be entitled to receive shares of Common
Stock at an effective price per share that is less than the Exercise Price, such
issuance shall be deemed to have occurred for less than the Exercise Price on
such date of the Dilutive Issuance at such effective price regardless of whether
such holder has received or ever receives shares at such effective price), then
simultaneously with the consummation of each Dilutive Issuance the Exercise
Price shall be reduced and only reduced to equal the Base Share Price and
consequently the number of Warrant Shares issuable hereunder shall be increased
such that the Aggregate Exercise Amount hereunder, after taking into account the
decrease in the Exercise Price, shall be equal to the Aggregate Exercise Amount
prior to such adjustment. Such adjustment shall be made whenever such Common
Stock or Common Stock Equivalents are issued. The Company shall notify the
Holder, in writing, no later than the business day following the issuance or
deemed issuance of any Common Stock or Common Stock Equivalents subject to this
Section 2.2, indicating therein the applicable issuance price, or applicable
reset price, exchange price, conversion price and other pricing terms (such
notice, the “Dilutive Issuance Notice”). In addition, the Company
shall provide the Holder, whenever the Holder requests at any time while this
Warrant is outstanding, a schedule of all issuances of Common Stock or Common
Stock Equivalents since the date of the Agreement, including the applicable
issuance price, or applicable reset price, exchange price, conversion price,
exercise price and other pricing terms. The term issuances shall also include
all agreements to issue, or prospectively issue Common Stock or Common Stock
Equivalents, regardless of whether the issuance contemplated by such agreement
is consummated. The Company shall notify the Holder in writing of any issuances
within twenty-four (24) hours of such issuance. For purposes of clarification,
whether or not the Company provides a Dilutive Issuance Notice pursuant to this
Section 2.2, upon the occurrence of any Dilutive Issuance, the Holder is
entitled to receive a number of Warrant Shares based upon the Base Share Price
regardless of whether the Holder accurately refers to the Base Share Price in
the Notice of Exercise. If the Company enters into a Variable Rate Transaction,
the Company shall be deemed to have issued Common Stock or Common Stock
Equivalents at the lowest possible conversion or exercise price at which such
securities may be converted or exercised. “Variable Rate
Transaction” means a transaction in which the Company (i) issues or sells
any debt or equity securities that are convertible into, exchangeable or
exercisable for, or include the right to receive, additional shares of Common
Stock either (A) at a conversion price, exercise price or exchange rate or other
price that is based upon, and/or varies with, the trading prices of or
quotations for the shares of Common Stock at any time after the initial issuance
of such debt or equity securities or (B) with a conversion, exercise or
exchange price that is subject to being reset at some future date after the
initial issuance of such debt or equity security or upon the occurrence of
specified or contingent events directly or indirectly related to the business of
the Company or the market for the Common Stock or (ii) enters into any
agreement, including, but not limited to, an equity line of credit, whereby the
Company may sell securities at a future determined price. 

4 

            2.3       
Pro Rata Distributions. If the Company, at any time while this Warrant is
outstanding, shall distribute to all holders of Common Stock (and not to the
Holder) evidences of its indebtedness or assets (including cash and cash
dividends) or rights or warrants to subscribe for or purchase any security other
than the Common Stock, then in each such case the Exercise Price shall be
adjusted by multiplying the Exercise Price in effect immediately prior to the
record date fixed for determination of stockholders entitled to receive such
distribution by a fraction of which the denominator shall be the VWAP determined
as of the record date mentioned above, and of which the numerator shall be such
VWAP on such record date less the then per share fair market value at such
record date of the portion of such assets or evidence of indebtedness or rights
or warrants so distributed applicable to one outstanding share of the Common
Stock as determined by the Board of Directors in good faith. In either case the
adjustments shall be described in a statement provided to the Holder of the
portion of assets or evidences of indebtedness so distributed or such
subscription rights applicable to one share of Common Stock. Such adjustment
shall be made whenever any such distribution is made and shall become effective
immediately after the record date mentioned above. 

            2.4       
Notice to Holder. Whenever the Exercise Price is adjusted pursuant to any
provision of this Article 2, the Company shall promptly notify the Holder (by
written notice) setting forth the Exercise Price after such adjustment and any
resulting adjustment to the number of Warrant Shares and setting forth a brief
statement of the facts requiring such adjustment. 

ARTICLE 3 COMPANY COVENANTS 

            3.1       
Reservation of Shares. As of the issuance date of this Warrant and for
the remaining period during which the Warrant is exercisable, the Company will
reserve from its authorized and unissued Common Stock a sufficient number of
shares to provide for the issuance of Warrant Shares upon the full exercise of
this Warrant. The Company represents that upon issuance, such Warrant Shares
will be duly and validly issued, fully paid and non-assessable. The Company
agrees that its issuance of this Warrant constitutes full authority to its
officers, agents and transfer agents who are charged with the duty of executing
and issuing shares to execute and issue the necessary Warrant Shares upon the
exercise of this Warrant. No further approval or authority of the stockholders
of the Board of Directors of the Company is required for the issuance of the
Warrant Shares. 

            3.2       
No Adverse Actions. Except and to the extent as waived or consented to by
the Holder, the Company shall not by any action, including, without limitation,
amending its certificate of incorporation or through any reorganization,
transfer of assets, consolidation, merger, dissolution, issue or sale of
securities or any other voluntary action, avoid or seek to avoid the observance
or performance of any of the terms of this Warrant, but will at all times in
good faith assist in the carrying out of all such terms and in the taking of all
such actions as may be necessary or appropriate to protect the rights of Holder
as set forth in this Warrant against impairment. Without limiting the generality
of the foregoing, the Company will (i) not increase the par value of any Warrant
Shares above the amount payable therefor upon such exercise immediately prior to
such increase in par value, (ii) take all such action as may be necessary or
appropriate in order that the Company may validly and legally issue fully paid
and non-assessable Warrant Shares upon the exercise of this Warrant and (iii)
use commercially reasonable efforts to obtain all such authorizations,
exemptions or consents from any public regulatory body having jurisdiction
thereof, as may be, necessary to enable the Company to perform its obligations
under this Warrant. 

ARTICLE 4 MISCELLANEOUS 

            4.1       
Representation by the Holder. The Holder, by the acceptance hereof,
represents and warrants that it is acquiring this Warrant and, upon any exercise
hereof, will acquire the Warrant Shares issuable upon such exercise, for its own
account and not with a view to or for distributing or reselling such Warrant
Shares or any part thereof in violation of the Securities Act or any applicable
state securities law, except pursuant to sales registered or exempted under the
Securities Act. 

5 

            4.2       
Transferability. Subject to compliance with any applicable securities
laws, this Warrant and all rights hereunder (including, without limitation, any
registration rights) are transferable, in whole or in part, by a written
assignment of this Warrant duly executed by the Holder or its agent or attorney.
If necessary to obtain a new warrant for any assignee, the Company, upon
surrender of this Warrant, shall execute and deliver a new Warrant or Warrants
in the name of the assignee or assignees, as applicable, and in the denomination
or denominations specified in such instrument of assignment, and shall issue to
the assignor a new Warrant evidencing the portion of this Warrant not so
assigned, and such new Warrants, for purposes of Rule 144, shall tack back to
the original date of this Warrant. The Warrant, if properly assigned in
accordance herewith, may be exercised by a new holder for the purchase of
Warrant Shares without having a new Warrant issued. 

            4.3       
Assignability. The Company may not assign this Warrant. This Warrant will
be binding upon the Company and its successors, and will inure to the benefit of
the Holder and its successors and assigns, and may be assigned by the Holder to
anyone of its choosing without the Company’s approval. 

            4.4       
Notices. Any notice required or permitted hereunder must be in writing
and either personally served, sent by facsimile or email transmission, or sent
by overnight courier. Notices will be deemed effectively delivered at the time
of transmission if by facsimile or email, and if by overnight courier the
business day after such notice is deposited with the courier service for
delivery. 

            4.5       
Governing Law. This Warrant will be governed by, and construed and
enforced in accordance with, the laws of the State of Nevada, without regard to
the conflict of laws principles thereof. Any action brought by either party
against the other concerning the transactions contemplated by this Warrant shall
be brought only in the state courts of Nevada or in the federal courts located
in the State of Nevada. Both parties and the individuals signing this Agreement
agree to submit to the jurisdiction of such courts. 

            4.6       
Delivery of Process by Holder to the Company. In the event of any action
or proceeding by Holder against the Company, and only by Holder against the
Company, service of copies of summons and/or complaint and/or any other process
which may be served in any such action or proceeding may be made by Holder via
overnight delivery service such as FedEx or UPS, process server, or by personal
delivery of a copy of such process to the Company at its last known address or
to its last known attorney set forth in its most recent SEC filing. 

            4.7       
No Rights as Stockholder Until Exercise. This Warrant does not entitle
the Holder to any voting rights, dividends or other rights as a stockholder of
the Company prior to the exercise hereof as set forth in Section 1.1. So long as
this Warrant is unexercised, this Warrant carries no voting rights and does not
convey to the Holder any “control” over the Company, as such term may be
interpreted by the SEC under the Securities Act or the Exchange Act, regardless
of whether the price of the Company’s Common Stock exceeds the Exercise Price.

            4.8       
Limitation of Liability. No provision hereof, in the absence of any
affirmative action by the Holder to exercise this Warrant to purchase Warrant
Shares, and no enumeration herein of the rights or privileges of the Holder,
shall give rise to any liability of the Holder for the purchase price of any
Common Stock or as a stockholder of the Company, whether such liability is
asserted by the Company or by creditors of the Company. 

            4.9       
Attorney Fees. In the event any attorney is employed by either party to
this Warrant with regard to any legal or equitable action, arbitration or other
proceeding brought by such party for the enforcement of this Warrant or because
of an alleged dispute, breach, default or misrepresentation in connection with
any of the provisions of this Warrant, the prevailing party in such proceeding
will be entitled to recover from the other party reasonable attorneys’ fees and
other costs and expenses incurred, in addition to any other relief to which the
prevailing party may be entitled. 

            4.10       
Opinion of Counsel. In the event that an opinion of counsel is needed for
any matter related to this Warrant, Holder has the right to have any such
opinion provided by its counsel. Holder also has the right to have any such
opinion provided by the Company’s counsel. 

            4.11       
Nonwaiver. No course of dealing or any delay or failure to exercise any
right hereunder on the part of Holder shall operate as a waiver of such right or
otherwise prejudice the Holder’s rights, powers or remedies. 

6 

            4.12       
Amendment Provision. The term “Warrant” and all references thereto, as
used throughout this instrument, means this instrument as originally executed,
or if later amended or supplemented, then as so amended or supplemented. 

            4.13       
No Shorting. Holder agrees that so long as this Warrant remains
unexercised in whole or in part, Holder will not enter into or effect any “short
sale” of the common stock or hedging transaction which establishes a net short
position with respect to the common stock of the Company. The Company
acknowledges and agrees that as of the date of delivery to the Company of a
fully and accurately completed Notice of Exercise, Holder immediately owns the
common shares described in the Notice of Exercise and any sale of those shares
issuable under such Notice of Exercise would not be considered short sales. 

* * * 

            IN
WITNESS WHEREOF, the Company has caused this Warrant to be executed by its
officer thereunto duly authorized as of the date first above indicated. 

LITHIUM EXPLORATION GROUP, INC. 

 

	 	By:	/s/ Alexander Walsh 
	 	 	Alexander Walsh 
	 	 	President 

 

 

	 	HOLDER: 
	 	JDF CAPITAL INC. 
	 	 
	 	/s/ John Fierro
	 	John Fierro, President 

8 

NOTICE OF EXERCISE 

TO:        LITHIUM
EXPLORATION GROUP, INC. 

                          (1)
The undersigned hereby elects to purchase ________ Warrant Shares of the Company
pursuant to the terms of the attached Warrant (only if exercised in full), and
tenders herewith payment of the exercise price in full, together with all
applicable transfer taxes, if any. 

                         
(2) Payment shall take the form of (check applicable box): 

[   ] in lawful money of the
United States; or 

[   ] the cancellation of
such number of Warrant Shares as is necessary, in accordance with the formula
set forth in Section 1.3, to exercise this Warrant with respect to the maximum
number of Warrant Shares purchasable pursuant to the cashless exercise procedure
set forth in Section 1.3. 

                          (3)
Please issue a certificate or certificates representing said Warrant Shares in
the name of the undersigned or in such other name as is specified below: 

_______________________________

 

The Warrant Shares shall be delivered to the following DWAC
Account Number: 

_______________________________

_______________________________

_______________________________

                           
(4) Accredited Investor. The undersigned is an “accredited investor” as
defined in Regulation D promulgated under the Securities Act of 1933, as
amended. 

[SIGNATURE OF HOLDER] 

 

Name:  _______________________________________
Date:
________________________________________

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