Document:

Lithium Exploration Group, Inc.: Exhibit 10.18 - Filed by newsfilecorp.com

PURCHASE AGREEMENT 

                                             THIS PURCHASE AGREEMENT,
dated as of March 3, 2014, is entered into by and among Lithium Exploration
Group, Inc., a Nevada corporation (the “Company”), and Iconic Holdings, 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. 

                                             (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 $100,000 (the
“Purchase Amount”), which Note shall be funded and issuable as
follows:

                                             (a)                  $100,000 of the Note shall be
funded and issued by March 3, 2014 or at such later date mutually agreed upon by
the parties (the “Closing Date”). 

                                             (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”. 

Page 1

                                             (v)                 The Purchaser shall deliver
the Purchase Amount to counsel for the Company on or before the Closing Date,
which Purchase Amount shall be held in trust and shall be released to the
Company upon delivery by the Company of the executed Note and Warrants to the
Purchaser. The Purchase Amount shall be promptly returned to the Purchaser if
the Company has not made such deliveries by the Closing Date.

                                             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 June 30,
2012. 

                                             “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. 

Page 2

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

                                             “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:

Page 3

Account Name: W.L. Macdonald
Law Corporation
Account Address: BMO Bank of Montreal
595 Burrard
Street, Vancouver, BC V7X1L7
Institution #:
001
Branch/Transit: 00040
Account ID:
00044641570
Swift Code: BOFMCAM2
Routing #:
CC000100040
IMPORTANT: Please quote file reference “Lithium Exploration Group
Ltd.

                                             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. 

Page 4

                                             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”). 

                                             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.

Page 5

                                             c.                  Authorized Shares.

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

                                             (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.

Page 6

                                             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. 

                                             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. 

Page 7

                                             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. 

                                             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.

Page 8

                                             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. 

                                             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.

Page 10

                                             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.”

                                             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.

Page 11

                                             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. 

                                             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. 

Page 12

                                             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:

                                             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;

Page 13

                                             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. 

                                             9.                  RIGHT OF FIRST REFUSAL 

                                             From and after the date of this
Agreement and at all times hereafter while the Note is outstanding, the Parties
agree that in the event that the Company receives any written or oral proposal
(the “Proposal”) containing one or more offers to provide additional capital or
financing through an equity line of credit and/or S-1 shelf registration in an
amount equal to or exceeding an aggregate of five hundred thousand dollars
($500,000.00) (the “Financing Amount”), the Company agrees that it shall provide
a copy of all documents received relating to the Proposal together with a
complete and accurate description of the Proposal to the Holder and all
amendments, revisions, and supplements thereto (the “Proposal Documents”) no
later than three (3) business days from the receipt of the Proposal Documents.
Following receipt of the Proposal Documents from the Company, the Holder shall
have the right (the “Right of First Refusal”), for a period of ten (10) business
days thereafter (the “Exercise Period”), to invest, at similar or better terms
to the Company, in an amount equal to or greater than the Financing Amount, upon
written notice to the Company that the Holder is exercising the Right of First
Refusal provided hereby. In furtherance of the Right of First Refusal, the
Company agrees that it will cooperate and assist Holder in conducting a due
diligence investigation of the Company and its corporate and financial affairs
and provide Holder with information and documents that Holder may reasonably
request so as to allow the Holder to make an informed investment decision.
However, the Company and Holder agree that Holder shall have no more than ten
(10) calendar days from and after the expiration of the Exercise Period to
exercise its Right of First Refusal hereunder. 

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. 

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

Page 15

                                             (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. 

                                             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 exclusive jurisdiction of the federal courts whose
districts encompass any part of the state courts of the State of Nevada 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.

Page 18

                                                                  (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.

                                             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. 

Page 19

                                             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: 	Iconic Holdings, LLC 
	  	7200 Wisconsin Ave. Suite 206 
	  	Bethesda MD 20814 
	  	Attn: Michael Sobeck 
	  	Telecopier No.: (619) 566-2011

                                             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. 

	ICONIC HOLDINGS, LLC 
	  
	By: 
	Name:     Michael Sobeck 
	Title:       Manager
  

	LITHIUM EXPLORATION GROUP, INC. 
	  
	By:
	(Signature of Authorized Person) 
	  
	Alex Walsh, CEO
  
	Printed Name and Title 

Page 21

	 	ANNEX I 	FORM OF NOTE 
	 	ANNEX II 	FORM OF WARRANT 

Page 22Lithium Exploration Group, Inc.: Exhibit 10.19 - Filed by newsfilecorp.com

THIS NOTE HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT
OF 1933, AS AMENDED (THE “ACT”), OR APPLICABLE STATE
SECURITIES LAWS, AND MAY NOT BE SOLD, TRANSFERRED, OR OTHERWISE DISPOSED OF IN
THE ABSENCE OF SUCH REGISTRATION OR RECEIPT BY THE COMPANY OF AN OPINION OF
COUNSEL IN THE FORM, SUBSTANCE AND SCOPE REASONABLY SATISFACTORY TO THE COMPANY
THAT THIS NOTE MAY BE SOLD, TRANSFERRED, OR OTHERWISE DISPOSED OF, UNDER AN
EXEMPTION FROM REGISTRATION UNDER THE ACT AND SUCH STATE SECURITIES LAWS.

LITHIUM EXPLORATION GROUP, INC. 

Convertible Promissory Note 
due September 3, 2014 

USD$100,000 

Dated: March 3, 2014 

                     For value received, Lithium
Exploration Group, Inc., a Nevada corporation (the “Company”), hereby
promises to pay to the order of Iconic Holdings, LLC (together with its
successors, representatives, and permitted assigns, the “Holder”), in
accordance with the terms hereinafter provided, up to an aggregate of $100,000
(One Hundred Thousand Dollars) (the “Principal Amount”), plus interest
accrued at the rate of twelve percent (12%) per annum. The Principal Amount
outstanding plus the accrued interest shall be due and payable on September 3,
2014 (the “Maturity Date”). 

                     All payments under or pursuant to
this Note refer to and shall be made in United States Dollars in immediately
available funds to the Holder at the address of the Holder first set forth above
or at such other place as the Holder may designate from time to time in writing
to the Company or by wire transfer of funds to the Holder’s account,
instructions for which are attached hereto as Exhibit A.

ARTICLE I 

                                             Section 1.1                      Purchase
Agreement. This Note has been executed and delivered pursuant to the
Security Purchase Agreement dated as of March 3, 2014 (the “Purchase
Agreement”) by and among the Company and the purchasers listed therein.
Capitalized terms used and not otherwise defined herein shall have the meanings
set forth for such terms in the Purchase Agreement.

                                             Section 1.2                      Interest.

                                             (a)                   Beginning on the issuance
date of this Note (the “Issuance Date”), the outstanding principal
balance of this Note shall bear interest, in arrears, at a rate per annum equal
to 12 percent accruing on a semi-annual basis commencing March 3, 2014 in cash
or restricted shares of the Company’s common stock, par value $0.001 per share
(the “Common Stock”) at the option of the Holder.

                                             Section 1.2                      Payment on
Non-Business Days. Whenever any payment to be made shall be due on a
Saturday, Sunday or a public holiday under the laws of the State of Nevada, such
payment may be due on the next succeeding business day and such next succeeding
day shall be included in the calculation of the amount of accrued interest
payable on such date. 

                                             Section 1.3                      Transfer. This
Note may be transferred or sold, subject to the provisions of Section 4.8 of
this Note, or pledged, hypothecated or otherwise granted as security by the
Holder. 

                                             Section 1.4                      Replacement.
Upon receipt of a duly executed, notarized and unsecured written statement from
the Holder with respect to the loss, theft or destruction of this Note (or any
replacement hereof), and without requiring an indemnity bond or other security,
or, in the case of a mutilation of this Note, upon surrender and cancellation of
such Note, the Company shall issue a new Note, of like tenor and amount, in lieu
of such lost, stolen, destroyed or mutilated Note. 

ARTICLE II 

EVENTS OF DEFAULT; REMEDIES 

                                              Section 2.1                      Events of
Default. The occurrence of any of the following events shall be an “Event of
Default” under this Note: 

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

                      (b)                   the Company 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 quoted or listed on at least one of the OTC QB, 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 Company’s notice to the
Holder, 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 Company 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 2.1(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
2.1) and such default is not fully cured within five (5) business days after the
occurrence thereof or (ii) any material covenant, condition or agreement
contained in the Purchase Agreement or any other Transaction Document which is
not covered by any other provisions of this Section 2.1 and such default is not
fully cured within five (5) business days after the occurrence thereof;

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

                      (h)                   the Company 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;

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                      (i)                   the Company 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 Company, 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 Company 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 Company or action under the laws of any
jurisdiction (foreign or domestic) analogous to any of the foregoing shall be
taken with respect to the Company and shall continue undismissed, or unstayed
and in effect for a period of sixty (60) days; or 

                      (k)                 the failure of the Company 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 Company that such shares of Common Stock can be
resold pursuant to Rule 144; or 

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

                      (m)                right of First Refusal. From
and after the date of this Note and at all times hereafter while the Note is
outstanding, the Parties agree that in the event that the Company receives any
written or oral proposal (the “Proposal”) containing one or more offers to
provide additional capital or financing through an equity line of credit and/or
S-1 shelf registration in an amount equal to or exceeding an aggregate of five
hundred thousand dollars ($500,000.00) (the “Financing Amount”), the Company
agrees that it shall provide a copy of all documents received relating to the
Proposal together with a complete and accurate description of the Proposal to
the Holder and all amendments, revisions, and supplements thereto (the “Proposal
Documents”) no later than three (3) business days from the receipt of the
Proposal Documents. Following receipt of the Proposal Documents from the
Company, the Holder shall have the right (the “Right of First Refusal”), for a
period of ten (10) business days thereafter (the “Exercise Period”), to invest,
at similar or better terms to the Company, in an amount equal to or greater than the Financing Amount, upon written notice to the Company
that the Holder is exercising the Right of First Refusal provided hereby. In
furtherance of the Right of First Refusal, the Company agrees that it will
cooperate and assist Holder in conducting a due diligence investigation of the
Company and its corporate and financial affairs and provide Holder with
information and documents that Holder may reasonably request so as to allow the
Holder to make an informed investment decision. However, the Company and Holder
agree that Holder shall have no more than ten (10) calendar days from and after
the expiration of the Exercise Period to exercise its Right of First Refusal
hereunder.

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                                              Section 2.2                      Remedies Upon An
Event of Default. If an Event of Default shall have occurred and shall be
continuing, the Holder of this Note may at any time at its option, (a) declare
the entire unpaid principal balance of this Note, together with all interest
accrued hereon, due and payable, and thereupon, the same shall be accelerated
and so due and payable, without presentment, demand, protest, or notice, all of
which are hereby expressly unconditionally and irrevocably waived by the
Company; provided, however, that upon the occurrence of an Event of Default
described in (i) Sections 2.1 (k) or (l), the outstanding principal balance and
interest hereunder shall be automatically due and payable and (ii) Sections 2.1
(a)-(j) and 2.1(m), demand the prepayment of this Note pursuant to Section 3.6
hereof, (b) subject to Section 3.4 hereof, demand that the principal amount of
this Note then outstanding shall be converted into shares of Common Stock at a
Conversion Price (as defined in Section 3.2(a) hereof) per share calculated
pursuant to Section 3.1 hereof assuming that the date that the Event of Default
occurs is the Conversion Date and demand that all accrued and unpaid interest
under this Note shall be converted into shares of Common Stock in accordance
with Section 1.2 hereof, or (c) exercise or otherwise enforce any one or more of
the Holder’s rights, powers, privileges, remedies and interests under this Note,
the Purchase Agreement, other Transaction Document or applicable law. No course
of delay on the part of the Holder shall operate as a waiver thereof or
otherwise prejudice the right of the Holder. No remedy conferred hereby shall be
exclusive of any other remedy referred to herein or now or hereafter available
at law, in equity, by statute or otherwise. 

ARTICLE III 

CONVERSION; ANTIDILUTION; PREPAYMENT 

                                              Section 3.1                      Conversion Option.

                                             (a)                   At any time on or after the
Issuance Date, this Note shall be convertible (in whole or in part), at the
option of the Holder (the “Conversion Option”), into such number of fully
paid and non-assessable shares of Common Stock (the “Conversion Rate”) as
is determined by dividing that portion of the outstanding principal balance
under this Note as of such date that the Holder elects to convert by the
Conversion Price (as defined in Section 3.2(a) hereof) then in effect on the
date on which the Holder faxes a notice of conversion (the “Conversion
Notice”), duly executed, to the Company (the “Voluntary Conversion
Date”), provided, however, that the Conversion Price shall be subject to
adjustment as described in Section 3.5 below. The Holder shall deliver this Note
to the Company at the address designated in the Purchase Agreement at such time
that this Note is fully converted. With respect to partial conversions of this
Note, the Company shall keep written records of the amount of this Note
converted as of each Conversion Date.

                                             (b)                   On any Voluntary Conversion
Date, the Holder may cause the any outstanding Principal Amount of this Note
plus all accrued and unpaid interest to convert into a number of fully paid and
nonassessable shares of Common Stock equal to the quotient of the elected
outstanding principal amount of this Note plus all accrued interest on the
elected outstanding on the Voluntary Conversion Date (as described in this
Section below) divided by the Conversion Price as described in Section 3.2(a)
below. 

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Furthermore, upon the occurrence of an Event of Default (as defined in Section 2.1 hereof), then to the extent permitted by law, the Company will pay interest to the Holder, payable on demand, on the outstanding principal balance of the Note from
the date of the Event of Default until such Event of Default is cured at the rate of the lesser of fifteen percent (15%) and the maximum applicable legal rate per annum. 

                                             (c)                   Conversion Limitations; Holder’s Restriction on Conversion. The Company shall not effect any conversion of this Note, and the Holder shall not have the right to convert any portion
of this Note, to the extent that after giving effect to such conversion, the Holder (together with the Holder’s affiliates), as set forth on the applicable Conversion Notice, would beneficially own in excess of 4.99% of the number of shares of
the Common Stock outstanding immediately after giving effect to such conversion. For purposes of the foregoing sentence, the number of shares of Common Stock beneficially owned by the Holder and its affiliates shall include the number of shares of
Common Stock issuable upon conversion of this Note with respect to which the determination of such sentence is being made, but shall exclude the number of shares of Common Stock which would be issuable upon (A) conversion of the remaining,
nonconverted portion of this Note beneficially owned by the Holder or any of its affiliates and (B) exercise or conversion of the unexercised or nonconverted portion of any other securities of the Company (including, without limitation, any other
Notes or the Warrants) subject to a limitation on conversion or exercise analogous to the limitation contained herein beneficially owned by the Holder or any of its affiliates. Except as set forth in the preceding sentence, for purposes of this
Section, beneficial ownership shall be calculated in accordance with Section 13(d) of the Exchange Act. To the extent that the limitation contained in this section applies, the determination of whether this Note is convertible (in relation to other
securities owned by the Holder) and of which a portion of this Note is convertible shall be in the sole discretion of such Holder. To ensure compliance with this restriction, the Holder will be deemed to represent to the Company each time it
delivers a Conversion Notice that such Conversion Notice has not violated the restrictions set forth in this paragraph and the Company shall have no obligation to verify or confirm the accuracy of such determination.  For purposes of this Section,
in determining the number of outstanding shares of Common Stock, the Holder may rely on the number of outstanding shares of Common Stock as reflected in (x) the Company’s most recent Form 10-Q or Form 10-K (or such related form), as the case
may be, (y) a more recent public announcement by the Company or (z) any other notice by the Company or the Company’s Transfer Agent setting forth the number of shares of Common Stock outstanding. Upon the written or oral request of the Holder,
the Company shall within two Trading Days confirm orally and in writing to the Holder the number of shares of Common Stock then outstanding. In any case, the number of outstanding shares of Common Stock shall be determined after giving effect to the
conversion or exercise of securities of the Company, including this Note, by the Holder or its affiliates since the date as of which such number of outstanding shares of Common Stock was reported. The provisions of this Section may be waived by the
Holder upon, at the election of the Holder, not less than 61 days’ prior notice to the Company, and the provisions of this Section shall continue to apply until such 61st day (or such later date, as determined by the Holder, as may be specified
in such notice of waiver). 

                                              Section 3.2                      Conversion Price.  

                                             (a)                   The term “Conversion Price” shall mean a 50% discount of the lowest closing price of the common stock for the 20 trading days immediately prior to (i) the date of the Purchase Agreement, or (ii) the
Voluntary Conversion Date.

                                              Section 3.3                      Mechanics of Conversion.

                                             (a)                   Not later than three (3) Trading Days after any Conversion Date, the Company or its designated transfer agent, as applicable, shall issue and deliver to the Depository Trust Company (“DTC”) account on the Holder’s behalf via the Deposit Withdrawal Agent Commission System (“DWAC”) as specified in the Conversion Notice, registered in the name of the Holder or its designee, for the number of
shares of Common Stock to which the Holder shall be entitled. In the alternative, not later than three (3) Trading Days after any Conversion Date, the Company shall deliver to the applicable Holder by express courier a certificate or certificates
which shall be free of restrictive legends and trading restrictions (other than those required by Section 5.1 of the Purchase Agreement) representing the number of shares of Common Stock being acquired upon the conversion of this Note (the
“Delivery Date”). Notwithstanding the foregoing to the contrary, the Company or its transfer agent shall only be obligated to issue and deliver the shares to the DTC on the Holder’s behalf via DWAC (or certificates free of
restrictive legends) if such conversion is in connection with a sale and the Holder has complied with the applicable prospectus delivery requirements. If in the case of any Conversion Notice such certificate or certificates are not delivered to or
as directed by the applicable Holder by the Delivery Date, the Holder shall be entitled by written notice to the Company at any time on or before its receipt of such certificate or certificates thereafter, to rescind such conversion, in which event
the Company shall immediately return this Note if tendered for conversion, whereupon the Company and the Holder shall each be restored to their respective positions immediately prior to the delivery of such notice of revocation, except that any
amounts described in Sections 3.3(b) and (c) shall be payable through the date notice of rescission is given to the Company.

-5- 

                                             (b)                   The Company understands that a delay in the delivery of the shares of Common Stock upon conversion of this Note beyond the Delivery Date could result in economic loss to the Holder. If the Company fails to deliver
to the Holder such shares via DWAC or a certificate or certificates pursuant to this Section hereunder by the Delivery Date, the Company shall pay to such Holder, in cash, an amount per Trading Day for each Trading Day until such shares are
delivered via DWAC or certificates are delivered, together with interest on such amount at a rate of 10% per annum, accruing until such amount and any accrued interest thereon is paid in full, equal to the greater of (A) (i) 1% of the aggregate
principal amount of the Note requested to be converted for the first five (5) Trading Days after the Delivery Date and (ii) 2% of the aggregate principal amount of the Note requested to be converted for each Trading Day thereafter. Nothing herein
shall limit a Holder’s right to pursue actual damages for the Company’s failure to deliver certificates representing shares of Common Stock upon conversion within the period specified herein and such Holder shall have the right to pursue
all remedies available to it at law or in equity (including, without limitation, a decree of specific performance and/or injunctive relief). Notwithstanding anything to the contrary contained herein, the Holder shall be entitled to withdraw a
Conversion Notice, and upon such withdrawal the Company shall only be obligated to pay the liquidated damages accrued in accordance with this Section 3.3(b) through the date the Conversion Notice is withdrawn. 

                                             (c)                   In addition to any other rights available to the Holder, if the Company fails to cause its transfer agent to transmit to the Holder a certificate or certificates representing the shares of Common Stock issuable upon
conversion of this Note on or before the Delivery Date, and if after such date the Holder is required by its broker to purchase (in an open market transaction or otherwise) shares of Common Stock to deliver in satisfaction of a sale by the Holder of
the shares of Common Stock issuable upon conversion of this Note which the Holder anticipated receiving upon such exercise (a “Buy-In”), then the Company shall (1) pay in cash to the Holder the amount by which (x) the
Holder’s total purchase price (including brokerage commissions, if any) for the shares of Common Stock so purchased exceeds (y) the amount obtained by multiplying (A) the number of shares of Common Stock issuable upon conversion of this Note
that the Company was required to deliver to the Holder in connection with the conversion at issue times (B) the price at which the sell order giving rise to such purchase obligation was executed, and (2) at the option of the Holder, either reinstate
the portion of the Note and equivalent number of shares of Common Stock for which such conversion was not honored or deliver to the Holder the number of shares of Common Stock that would have been issued had the Company timely complied with its conversion and delivery obligations hereunder. For example, if the Holder purchases Common Stock having a total purchase price of $11,000 to cover a Buy-In with respect to an attempted conversion of shares of Common Stock with an
aggregate sale price giving rise to such purchase obligation of $10,000, under clause (1) of the immediately preceding sentence the Company shall be required to pay the Holder $1,000. The Holder shall provide the Company written notice
indicating the amounts payable to the Holder in respect of the Buy-In, together with applicable confirmations and other evidence reasonably requested by the Company.  Nothing herein 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 certificates representing shares of Common Stock
upon conversion of this Note as required pursuant to the terms hereof. 

-6- 

                                              Section 3.4                      Ownership Cap and Certain Conversion Restrictions. 

                                             Notwithstanding anything to the contrary set forth in Section 3 of this Note, at no time may the Holder convert all or a portion of this Note if the number of shares of Common Stock to be issued pursuant to such
conversion would exceed, when aggregated with all other shares of Common Stock owned by the Holder at such time, the number of shares of Common Stock which would result in the Holder beneficially owning (as determined in accordance with Section
13(d) of the Exchange Act and the rules thereunder) more than 9.9% of all of the Common Stock outstanding at such time; provided, however, that upon the Holder providing the Company with sixty-one (61) days notice (pursuant to Section 4.1 hereof)
(the “Waiver Notice”) that the Holder would like to waive this Section 3.4 with regard to any or all shares of Common Stock issuable upon conversion of this Note, this Section 3.4 will be of no force or effect with regard to all or a
portion of the Note referenced in the Waiver Notice; provided, further, that this provision shall be of no further force or effect during the sixty-one (61) days immediately preceding the Maturity Date.

                                              Section 3.5                      Adjustment of Conversion Price. 

                                             (a)                   The Conversion Price shall be subject to adjustment from time to time as follows: 

                                                                    (i)                   Adjustments for Stock Splits and Combinations. If the Company shall at any time or from time to time after the Issuance Date, effect a stock split of the outstanding Common Stock, the applicable Conversion
Price in effect immediately prior to the stock split shall be proportionately decreased.  If the Company shall at any time or from time to time after the Issuance Date, combine the outstanding shares of Common Stock, the applicable Conversion Price
in effect immediately prior to the combination shall be proportionately increased.  Any adjustments under this Section 3.5(a)(i) shall be effective at the close of business on the date the stock split or combination occurs. 

                                                                    (ii)                    Adjustments for Certain Dividends and Distributions.  If the Company shall at any time or from time to time after the Issuance Date, make or issue or set a record date for the determination of holders of
Common Stock entitled to receive a dividend or other distribution payable in shares of Common Stock, then, and in each event, the applicable Conversion Price in effect immediately prior to such event shall be decreased as of the time of such
issuance or, in the event such record date shall have been fixed, as of the close of business on such record date, by multiplying, the applicable Conversion Price then in effect by a fraction: 

                                                                                            (1)                    the numerator of which shall be the total number of shares of Common Stock issued and outstanding immediately prior to the time of such issuance or the close of business on such record date; and 

-7- 

                                                                                            (2)                    the denominator of which shall be the total number of shares of Common Stock issued and outstanding immediately prior to the time of such issuance or the close of business on such record date plus the number of
shares of Common Stock issuable in payment of such dividend or distribution. 

                                                                    (iii)                    Adjustment for Other Dividends and Distributions. If the Company shall at any time or from time to time after the Issuance Date, make or issue or set a record date for the determination of holders of Common
Stock entitled to receive a dividend or other distribution payable in other than shares of Common Stock, then, and in each event, an appropriate revision to the applicable Conversion Price shall be made and provision shall be made (by adjustments of
the Conversion Price or otherwise) so that the holders of this Note shall receive upon conversions thereof, in addition to the number of shares of Common Stock receivable thereon, the number of securities of the Company which they would have
received had this Note been converted into Common Stock on the date of such event and had thereafter, during the period from the date of such event to and including the Conversion Date, retained such securities (together with any distributions
payable thereon during such period), giving application to all adjustments called for during such period under this Section 3.5(a)(iii) with respect to the rights of the holders of this Note; provided, however, that if such record date
shall have been fixed and such dividend is not fully paid or if such distribution is not fully made on the date fixed therefor, the Conversion Price shall be adjusted pursuant to this paragraph as of the time of actual payment of such dividends or
distributions. 

                                                                    (iv)                    Adjustments for Reclassification, Exchange or Substitution.  If the Common Stock issuable upon conversion of this Note at any time or from time to time after the Issuance Date shall be changed to the same or
different number of shares of any class or classes of stock, whether by reclassification, exchange, substitution or otherwise (other than by way of a stock split or combination of shares or stock dividends provided for in Sections 3.5(a)(i), (ii)
and (iii), or a reorganization, merger, consolidation, or sale of assets provided for in Section 3.5(a)(v)), then, and in each event, an appropriate revision to the Conversion Price shall be made and provisions shall be made (by adjustments of the
Conversion Price or otherwise) so that the Holder shall have the right thereafter to convert this Note into the kind and amount of shares of stock and other securities receivable upon reclassification, exchange, substitution or other change, by
holders of the number of shares of Common Stock into which such Note might have been converted immediately prior to such reclassification, exchange, substitution or other change, all subject to further adjustment as provided herein. 

                                                                    (v)                    Adjustments for Reorganization, Merger, Consolidation or Sales of Assets. If at any time or from time to time after the Issuance Date there shall be a capital reorganization of the Company (other than
by way of a stock split or combination of shares or stock dividends or distributions provided for in Section 3.5(a)(i), (ii) and (iii), or a reclassification, exchange or substitution of shares provided for in Section 3.5(a)(iv)), or a merger or
consolidation of the Company with or into another corporation where the holders of outstanding voting securities prior to such merger or consolidation do not own over fifty percent (50%) of the outstanding voting securities of the merged or
consolidated entity, immediately after such merger or consolidation, or the sale of all or substantially all of the Company’s properties or assets to any other person (an “Organic Change”), then as a part of such Organic Change
an appropriate revision to the Conversion Price shall be made and provision shall be made (by adjustments of the Conversion Price or otherwise) so that the Holder shall have the right thereafter to convert such Note into the kind and amount of
shares of stock and other securities or property of the Company or any successor corporation resulting from Organic Change. In any such case, appropriate adjustment shall be made in the application of the provisions of this Section 3.5(a)(v) with
respect to the rights of the Holder after the Organic Change to the end that the provisions of this Section 3.5(a)(v) (including any adjustment in the applicable Conversion Price then in effect and the number of shares of stock or other securities
deliverable upon conversion of this Note) shall be applied after that event in as nearly an equivalent manner as may be practicable.

-8- 

                                                                    (vi)                      Issuance of Common Stock Equivalents.  If the Company, at any time after the Issuance Date, shall issue any securities convertible into or exchangeable for, directly or indirectly, Common Stock
(“Convertible Securities”), other than the Note, or any rights or warrants or options to purchase any such Common Stock or Convertible Securities, shall be issued or sold (collectively, the “Common Stock
Equivalents”) and the aggregate of the price per share for which Additional Shares of Common Stock may be issuable thereafter pursuant to such Common Stock Equivalent, plus the consideration received by the Company for issuance of such
Common Stock Equivalent divided by the number of shares of Common Stock issuable pursuant to such Common Stock Equivalent (the “Aggregate Per Common Share Price”) shall be less than the applicable Conversion Price then in effect, or
if, after any such issuance of Common Stock Equivalents, the price per share for which Additional Shares of Common Stock may be issuable thereafter is amended or adjusted, and such price as so amended shall make the Aggregate Per Share Common Price
be less than the applicable Conversion Price in effect at the time of such amendment or adjustment, then the applicable Conversion Price upon each such issuance or amendment shall be adjusted as provided in the first sentence of subsection (vi) of
this Section 3.5(a) on the basis that (1) the maximum number of Additional Shares of Common Stock issuable pursuant to all such Common Stock Equivalents shall be deemed to have been issued (whether or not such Common Stock Equivalents are actually
then exercisable, convertible or exchangeable in whole or in part) as of the earlier of (A) the date on which the Company shall enter into a firm contract for the issuance of such Common Stock Equivalent, or (B) the date of actual issuance of such
Common Stock Equivalent. No adjustment of the applicable Conversion Price shall be made under this subsection (vii) upon the issuance of any Convertible Security which is issued pursuant to the exercise of any warrants or other subscription or
purchase rights therefor, if any adjustment shall previously have been made to the exercise price of such warrants then in effect upon the issuance of such warrants or other rights pursuant to this subsection (vii). No adjustment shall be made to
the Conversion Price upon the issuance of Common Stock pursuant to the exercise, conversion or exchange of any Convertible Security or Common Stock Equivalent where an adjustment to the Conversion Price was made as a result of the issuance or
purchase of any Convertible Security or Common Stock Equivalent. 

                                                                    (vii)                      Consideration for Stock.  In case any shares of Common Stock or any Common Stock Equivalents shall be issued or sold: 

                                                                                            (1)                      in connection with any merger or consolidation in which the Company is the surviving corporation (other than any consolidation or merger in which the previously outstanding shares of Common Stock of the Company
shall be changed to or exchanged for the stock or other securities of another corporation), the amount of consideration therefor shall be, deemed to be the fair value, as determined reasonably and in good faith by the Board of Directors of the
Company, of such portion of the assets and business of the non-surviving corporation as such Board may determine to be attributable to such shares of Common Stock, Convertible Securities, rights or warrants or options, as the case may be; or 

                                                                                            (2)                      in the event of any consolidation or merger of the Company in which the Company is not the surviving corporation or in which the previously outstanding shares of Common Stock of the Company shall be changed into or
exchanged for the stock or other securities of another corporation, or in the event of any sale of all or substantially all of the assets of the Company for stock or other securities of any corporation, the Company shall be deemed to have issued a
number of shares of its Common Stock for stock or securities or other property of the other corporation computed on the basis of the actual exchange ratio on which the transaction was predicated, and for a consideration equal to the fair market
value on the date of such transaction of all such stock or securities or other property of the other corporation.  If any such calculation results in adjustment of the applicable Conversion Price, or the number of shares of Common Stock issuable upon conversion of the Note, the determination of the applicable Conversion Price or the number of shares of Common Stock issuable upon conversion of the Note immediately prior to
such merger, consolidation or sale, shall be made after giving effect to such adjustment of the number of shares of Common Stock issuable upon conversion of the Note.  In the event Common Stock is issued with other shares or securities or other
assets of the Company for consideration which covers both, the consideration computed as provided in this Section 3.5(viii) shall be allocated among such securities and assets as determined in good faith by the Board of Directors of the Company. 

-9- 

                                             (b)                      Record Date.  In case the Company shall take record of the holders of its Common Stock for the purpose of entitling them to subscribe for or purchase Common Stock or Convertible Securities, then the date of
the issue or sale of the shares of Common Stock shall be deemed to be such record date. 

                                             (c)                      Certain Issues Excepted.  Anything herein to the contrary notwithstanding, the Company shall not be required to make any adjustment to the Conversion Price in connection with (i) securities issued (other than
for cash) in connection with a merger, acquisition, or consolidation, (ii) securities issued pursuant to a bona fide firm underwritten public offering of the Company’s securities, (iii) securities issued pursuant to the conversion or exercise
of convertible or excercisable securities issued or outstanding on or prior to the date hereof or issued pursuant to the Purchase Agreement, (iv) the shares of Common Stock issuable upon the exercise of Warrants, (v) securities issued in connection
with strategic license agreements or other partnering arrangements so long as such issuances are not for the purpose of raising capital, (vi) Common Stock issued or options to purchase Common Stock granted or issued pursuant to the Company’s
stock option plans and employee stock purchase plans as they now exist and (vii) the payment of any accrued interest in shares of Common Stock pursuant to this Note. 

                                              (d)                      No Impairment.  The Company shall not, by amendment of 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 to be observed or performed hereunder by the Company, but will at all times in good faith, assist in the carrying out of all the provisions of this
Section 3.5 and in the taking of all such action as may be necessary or appropriate in order to protect the Conversion Rights of the Holder against impairment.  In the event a Holder shall elect to convert any Note as provided herein, the Company
cannot refuse conversion based on any claim that such Holder or any one associated or affiliated with such Holder has been engaged in any violation of law, violation of an agreement to which such Holder is a party or for any reason whatsoever,
unless, an injunction from a court, or notice, restraining and or adjoining conversion of all or of said Note shall have issued and the Company posts a surety bond for the benefit of such Holder in an amount equal to one hundred thirty percent
(130%) of the amount of the Note the Holder has elected to convert, which bond shall remain in effect until the completion of arbitration/litigation of the dispute and the proceeds of which shall be payable to such Holder in the event it obtains
judgment. 

                                             (e)                      Certificates as to Adjustments.  Upon occurrence of each adjustment or readjustment of the Conversion Price or number of shares of Common Stock issuable upon conversion of this Note pursuant to this Section
3.5, the Company at its expense shall promptly compute such adjustment or readjustment in accordance with the terms hereof and furnish to the Holder a certificate setting forth such adjustment and readjustment, showing in detail the facts upon which
such adjustment or readjustment is based. The Company shall, upon written request of the Holder, at any time, furnish or cause to be furnished to the Holder a like certificate setting forth such adjustments and readjustments, the applicable
Conversion Price in effect at the time, and the number of shares of Common Stock and the amount, if any, of other securities or property which at the time would be received upon the conversion of this Note.  Notwithstanding the foregoing, the Company shall not be obligated to deliver a certificate unless such certificate would reflect an increase or decrease of at least one percent (1%) of such adjusted amount.

-10- 

                                             (f)                      Issue Taxes. The Company shall pay any and all issue and other taxes, excluding federal, state or local income taxes, that may be payable in respect of any issue or delivery of shares of Common Stock on
conversion of this Note pursuant thereto; provided, however, that the Company shall not be obligated to pay any transfer taxes resulting from any transfer requested by the Holder in connection with any such conversion. 

                                             (g)                      Fractional Shares. No fractional shares of Common Stock shall be issued upon conversion of this Note. In lieu of any fractional shares to which the Holder would otherwise be entitled, the Company shall pay
cash equal to the product of such fraction multiplied by the average of the Closing Bid Prices of the Common Stock for the five (5) consecutive Trading Days immediately preceding the Conversion Date.

                                             (h)                      Reservation of Common Stock. The Company shall at all times when this Note shall be outstanding, reserve and keep available out of its authorized but unissued Common Stock, such number of shares of Common
Stock as shall from time to time be sufficient to effect the conversion of this Note and all interest accrued thereon; provided that the number of shares of Common Stock so reserved shall at no time be less than one hundred twenty percent
(120%) of the number of shares of Common Stock for which this Note and all interest accrued thereon are at any time convertible.  The Company shall, from time to time in accordance with Nevada corporate law, increase the authorized number of shares
of Common Stock if at any time the unissued number of authorized shares shall not be sufficient to satisfy the Company’s obligations under this Section 3.5(h) . 

                                             (i)                      Regulatory Compliance. If any shares of Common Stock to be reserved for the purpose of conversion of this Note or any interest accrued thereon require registration or listing with or approval of any
governmental authority, stock exchange or other regulatory body under any federal or state law or regulation or otherwise before such shares may be validly issued or delivered upon conversion, the Company shall, at its sole cost and expense, in good
faith and as expeditiously as possible, endeavor to secure such registration, listing or approval, as the case may be. 

                                             Section 3.6                      Prepayment. 

                                             (a)                      Prepayment Upon an Event of Default. Notwithstanding anything to the contrary contained herein, upon the occurrence of an Event of Default described in Sections 2.1(a) -(j) and 2.1(m) -(o) hereof, the Holder
shall have the right, at such Holder’s option, to require the Company to prepay in cash all or a portion of this Note at a price equal to one hundred twenty percent (120%) of the aggregate principal amount of this Note plus all accrued and
unpaid interest applicable at the time of such request (the “Event of Default Prepayment Price”). Nothing in this Section 3.6(a) shall limit the Holder’s rights under Section 2.2 hereof. 

                                             (b)                      Prepayment Option Upon Major Transaction. In addition to all other rights of the Holder contained herein, simultaneous with the occurrence of a Major Transaction (as defined in Section 3.6(e) hereof), the
Holder shall have the right, at the Holder’s option, to require the Company to prepay all or a portion of the Holder’s Note at a price equal to one hundred ten percent (110%) of the aggregate principal amount of this Note plus all accrued
and unpaid interest (the “Major Transaction Prepayment Price”). 

-11- 

                                             (c)                      Prepayment Option Upon Triggering Event. In addition to all other rights of the
Holder contained herein, after a Triggering Event (as defined below), the Holder shall have the right, at the Holder’s option, to require the Company to prepay all or a portion of this Note in cash at a price equal to the sum of (i) the greater
of (A) one hundred twenty percent (120%) of the aggregate principal amount of this Note plus all accrued and unpaid interest and (B) in the event at such time the Holder is unable to obtain the benefit of its conversion rights through the conversion
of this Note and resale of the shares of Common Stock issuable upon conversion hereof in accordance with the terms of this Note and the other Transaction Documents, the aggregate principal amount of this Note plus all accrued but unpaid interest
hereon, divided by the Conversion Price on (x) the date the Prepayment Price (as defined below) is demanded or otherwise due or (y) the date the Prepayment Price is paid in full, whichever is less, multiplied by the VWAP on (x) the date the
Prepayment Price is demanded or otherwise due, and (y) the date the Prepayment Price is paid in full, whichever is greater, and (ii) all other amounts, costs, expenses and liquidated damages due in respect of this Note and the other Transaction
Documents (the “Triggering Event Prepayment Price,” and, collectively with the “Major Transaction Prepayment Price,” the “Prepayment Price”).

                                             (d)                       Major Transaction. A “Major Transaction” shall be deemed to have occurred at such time as any of the following events: 

                                                                    (i)                      the consolidation, merger or other business combination of the Company with or into another Person (other than (A) pursuant to a migratory merger effected solely for the purpose of changing the jurisdiction of
incorporation of the Company or (B) a consolidation, merger or other business combination in which holders of the Company’s voting power immediately prior to the transaction continue after the transaction to hold, directly or indirectly, the
voting power of the surviving entity or entities necessary to elect a majority of the members of the board of directors (or their equivalent if other than a corporation) of such entity or entities); or 

                                                                    (ii) the sale or transfer of more than fifty percent (50%) of the Company’s assets (based on the fair market value as determined in good faith by the Company’s Board of Directors) other than inventory in the
ordinary course of business in one or a related series of transactions; or 

                                                                    (iii)                      closing of a purchase, tender or exchange offer made to the holders of more than fifty percent (50%) of the outstanding shares of Common Stock in which more than fifty percent (50%) of the outstanding shares of
Common Stock were tendered and accepted. 

                                             (e)                       Triggering Event.  A “Triggering Event” shall be deemed to have occurred at such time as any of the following events: 

                                                                    (i)                      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; 

                                                                    (ii)                      the Company’s notice to any holder of the Note, including by way of public announcement, at any time, of its inability to comply (including for any of the reasons described in Section 3.8) or its intention not
to comply with proper requests for conversion of any Note into shares of Common Stock; or 

                                                                    (iii)                      the Company’s failure to comply with a Conversion Notice tendered in accordance with the provisions of this Note within ten (10) business days after the receipt by the Company of the Conversion Notice; or 

-12- 

                                                                    (iv)                      the Company deregisters its shares of Common Stock and as a result such shares of Common Stock are no longer publicly traded; or 

                                                                    (v)                      the Company consummates a “going private” transaction and as a result the Common Stock is no longer registered under Sections 12(b) or 12(g) of the Exchange Act. 

                                             (f)                      Mechanics of Prepayment at Option of Holder Upon Major Transaction.  No sooner than fifteen (15) days nor later than ten (10) days prior to the consummation of a Major Transaction, but not prior to the public
announcement of such Major Transaction, the Company shall deliver written notice thereof via facsimile and overnight courier (“Notice of Major Transaction”) to the Holder of this Note. At any time after receipt of a Notice of Major
Transaction (or, in the event a Notice of Major Transaction is not delivered at least ten (10) days prior to a Major Transaction, at any time within ten (10) days prior to a Major Transaction), any holder of the Notes then outstanding may require
the Company to prepay, effective immediately prior to the consummation of such Major Transaction, all of the holder’s Notes then outstanding by delivering written notice thereof via facsimile and overnight courier (“Notice of Prepayment at
Option of Holder Upon Major Transaction”) to the Company, which Notice of Prepayment at Option of Holder Upon Major Transaction shall indicate (i) the number of Notes that such holder is electing to prepay and (ii) the applicable Major
Transaction Prepayment Price, as calculated pursuant to Section 3.6(b) above. 

                                             (g)                      Mechanics of Prepayment at Option of Holder Upon Triggering Event. Within one (1) business day after the occurrence of a Triggering Event, the Company shall deliver written notice thereof via facsimile and
overnight courier (“Notice of Triggering Event”) to each holder of the Notes. At any time after the earlier of a holder’s receipt of a Notice of Triggering Event and such holder becoming aware of a Triggering Event, any holder of this
Note may require the Company to prepay all of the Notes on a pro rata basis by delivering written notice thereof via facsimile and overnight courier (“Notice of Prepayment at Option of Holder Upon Triggering Event”) to the
Company, which Notice of Prepayment at Option of Holder Upon Triggering Event shall indicate (i) the amount of the Note that such holder is electing to have prepaid and (ii) the applicable Triggering Event Prepayment Price, as calculated pursuant to
Section 3.6(c) above.  A holder shall only be permitted to require the Company to prepay the Note pursuant to Section 3.6 hereof for the greater of a period of ten (10) days after receipt by such holder of a Notice of Triggering Event or for so long
as such Triggering Event is continuing. 

                                             (h)                      Payment of Prepayment Price.  Upon the Company’s receipt of a Notice(s) of Prepayment at Option of Holder Upon Triggering Event or a Notice(s) of Prepayment at Option of Holder Upon Major Transaction
from any holder of the Notes, the Company shall immediately notify each holder of the Notes by facsimile of the Company’s receipt of such Notice(s) of Prepayment at Option of Holder Upon Triggering Event or Notice(s) of Prepayment at Option of
Holder Upon Major Transaction and each holder which has sent such a notice shall promptly submit to the Company such holder’s certificates representing the Notes which such holder has elected to have prepaid.  The Company shall deliver the
applicable Triggering Event Prepayment Price, in the case of a prepayment pursuant to Section 3.6(i), to such holder within five (5) business days after the Company’s receipt of a Notice of Prepayment at Option of Holder Upon Triggering Event
and, in the case of a prepayment pursuant to Section 3.(f), the Company shall deliver the applicable Major Transaction Prepayment Price immediately prior to the consummation of the Major Transaction; provided that a holder’s original Note shall
have been so delivered to the Company; provided further that if the Company is unable to prepay all of the Notes to be prepaid, the Company shall prepay an amount from each holder of the Notes being prepaid equal to such holder’s pro-rata
amount (based on the number of Notes held by such holder relative to the number of Notes outstanding) of all Notes being prepaid.  If the Company shall fail to prepay all of the Notes submitted for prepayment (other than pursuant to a dispute as to
the arithmetic calculation of the Prepayment Price), in addition to any remedy such holder of the Notes may have under this Note and the Purchase Agreement, the applicable Prepayment Price payable in respect of such Notes not prepaid shall bear interest at the rate of two percent (2%) per month (prorated for partial months) until paid in full. Until the Company pays such unpaid
applicable Prepayment Price in full to a holder of the Notes submitted for prepayment, such holder shall have the option (the “Void Optional Prepayment Option”) to, in lieu of prepayment, require the Company to promptly return to such
holder(s) all of the Notes that were submitted for prepayment by such holder(s) under this Section 3.6 and for which the applicable Prepayment Price has not been paid, by sending written notice thereof to the Company via facsimile (the “Void
Optional Prepayment Notice”). Upon the Company’s receipt of such Void Optional Prepayment Notice(s) and prior to payment of the full applicable Prepayment Price to such holder, (i) the Notice(s) of Prepayment at Option of Holder Upon
Triggering Event or the Notice(s) of Prepayment at Option of Holder Upon Major Transaction, as the case may be, shall be null and void with respect to those Notes submitted for prepayment and for which the applicable Prepayment Price has not been
paid, (ii) the Company shall immediately return any Notes submitted to the Company by each holder for prepayment under this Section 3.6(h) and for which the applicable Prepayment Price has not been paid and (iii) the Conversion Price of such
returned Notes shall be adjusted to the lesser of (A) the Conversion Price as in effect on the date on which the Void Optional Prepayment Notice(s) is delivered to the Company and (B) the lowest Closing Bid Price during the period beginning on the
date on which the Notice(s) of Prepayment of Option of Holder Upon Major Transaction or the Notice(s) of Prepayment at Option of Holder Upon Triggering Event, as the case may be, is delivered to the Company and ending on the date on which the Void
Optional Prepayment Notice(s) is delivered to the Company; provided that no adjustment shall be made if such adjustment would result in an increase of the Conversion Price then in effect.  A holder’s delivery of a Void Optional Prepayment
Notice and exercise of its rights following such notice shall not effect the Company’s obligations to make any payments which have accrued prior to the date of such notice. Payments provided for in this Section 3.6 shall have priority to
payments to other stockholders in connection with a Major Transaction.

-13- 

                                             (i)                      Company Prepayment Option upon Major Transaction. Upon the consummation of a Major Transaction, the Company may prepay in cash all or any portion of the outstanding principal amount of this Note together with
all accrued and unpaid interest thereon upon at least thirty (30) days prior written notice to the Holder (the “Company’s Prepayment Notice”) at a price equal to one hundred twenty percent (120%) of the aggregate
principal amount of this Note plus any accrued but unpaid interest (the “Company’s Prepayment Price”); provided, however, that if a holder has delivered a Conversion Notice to the Company or delivers a Conversion
Notice within such thirty (30) day period following delivery of the Company’s Prepayment Notice, the principal amount of the Notes plus any accrued but unpaid interest designated to be converted may not be prepaid by the Company and shall be
converted in accordance with Section 3.3 hereof; provided further that if during the period between delivery of the Company’s Prepayment Notice and the Company’s Prepayment Date (as defined below), a holder shall become entitled and elects
to deliver a Notice of Prepayment at Option of Holder Upon Major Transaction or Notice of Prepayment at Option of Holder upon Triggering Event, then such rights of the holders shall take precedence over the previously delivered Company Prepayment
Notice if the holder so elects. The Company’s Prepayment Notice shall state the date of prepayment which date shall be the date of the consummation of the Major Transaction (the “Company’s Prepayment Date”), the Company’s
Prepayment Price and the principal amount of Notes plus any accrued but unpaid interest to be prepaid by the Company.  The Company shall deliver the Company’s Prepayment Price on the Company’s Prepayment Date, provided, that if the
holder(s) delivers a Conversion Notice before the Company’s Prepayment Date, then the portion of the Company’s Prepayment Price which would be paid to prepay the Notes covered by such Conversion Notice shall be returned to the Company upon
delivery of the Common Stock issuable in connection with such Conversion Notice to the holder(s). On the Company’s Prepayment Date, the Company shall pay the Company’s Prepayment Price, subject to any adjustment pursuant to the immediately
preceding sentence, to the holder(s) on a pro rata basis. If the Company fails to pay the Company’s Prepayment Price by the third (3rd) business day after the Company’s Prepayment Date, the prepayment will be declared null and void and the Company shall lose its right to serve a Company’s Prepayment Notice pursuant to this Section 3.6(i) in the future.  Notwithstanding the foregoing to the contrary, the Company may
effect a prepayment pursuant to this Section 3.6(i) only if trading in the Common Stock shall not have been suspended by the Securities and Exchange Commission or the Nasdaq SmallCap Market (or other exchange or market on which the Common Stock is
trading), and and the Company is in material compliance with the terms and conditions of this Note and the other Transaction Documents.

-14- 

                                             Section 3.7                      Inability to Fully Convert. 

                                             (a)                      Holder’s Option if Company Cannot Fully Convert.  If, upon the Company’s receipt of a Conversion Notice, the Company cannot issue shares of Common Stock for any reason, including,
without limitation, because the Company (w) does not have a sufficient number of shares of Common Stock authorized and available, or (x) is otherwise prohibited by applicable law or by the rules or regulations of any stock exchange, interdealer
quotation system or other self-regulatory organization with jurisdiction over the Company or any of its securities from issuing all of the Common Stock which is to be issued to the Holder pursuant to a Conversion Notice, then the Company shall issue
as many shares of Common Stock as it is able to issue in accordance with the Holder’s Conversion Notice and, with respect to the unconverted portion of this Note, the Holder, solely at Holder’s option, can elect to: 

                                                                    (i)                      require the Company to prepay that portion of this Note for which the Company is unable to issue Common Stock in accordance with the Holder’s Conversion Notice (the “Mandatory Prepayment”) at a
price per share equal to the Triggering Event Prepayment Price as of such Conversion Date (the “Mandatory Prepayment Price”); 

                                                                    (ii)                      void its Conversion Notice and retain or have returned, as the case may be, this Note that was to be converted pursuant to the Conversion Notice (provided that the Holder’s voiding its Conversion Notice shall
not effect the Company’s obligations to make any payments which have accrued prior to the date of such notice). 

In the event a Holder shall elect to convert any portion of its Notes as provided herein, the Company cannot refuse conversion based on any claim that such Holder or any one associated or affiliated with such Holder has been engaged in any violation
of law, violation of an agreement to which such Holder is a party or for any reason whatsoever, unless, an injunction from a court, on notice, restraining and or adjoining conversion of all or of said Notes shall have been issued and the Company
posts a surety bond for the benefit of such Holder in an amount equal to 130% of the principal amount of the Notes the Holder has elected to convert, which bond shall remain in effect until the completion of arbitration/litigation of the dispute and
the proceeds of which shall be payable to such Holder in the event it obtains judgment.

                                             (b)                      Mechanics of Fulfilling Holder’s Election. The Company shall immediately send via facsimile to the Holder, upon receipt of a facsimile copy of a Conversion Notice from the Holder which
cannot be fully satisfied as described in Section 3.7(a) above, a notice of the Company’s inability to fully satisfy the Conversion Notice (the “Inability to Fully Convert Notice”). Such Inability to Fully Convert Notice shall
indicate (i) the reason why the Company is unable to fully satisfy such holder’s Conversion Notice, (ii) the amount of this Note which cannot be converted and (iii) the applicable Mandatory Prepayment Price. The Holder shall notify the Company
of its election pursuant to Section 3.7(a) above by delivering written notice via facsimile to the Company (“Notice in Response to Inability to Convert”). 

-15- 

                                             (c)                      Payment of Prepayment Price. If the Holder shall elect to have its Notes prepaid pursuant to Section 3.7(a)(i) above, the Company shall pay the
Mandatory Prepayment Price to the Holder within thirty (30) days of the
Company’s receipt of the Holder’s Notice in Response to Inability to Convert,
provided that prior to the Company’s receipt of the Holder’s Notice in
Response to Inability to Convert the Company has not delivered a notice to the
Holder stating, to the satisfaction of the Holder, that the event or condition
resulting in the Mandatory Prepayment has been cured and all Conversion Shares
issuable to the Holder can and will be delivered to the Holder in accordance
with the terms of this Note. If the Company shall fail to pay the applicable
Mandatory Prepayment Price to the Holder on a timely basis as described in this
Section 3.7(c) (other than pursuant to a dispute as to the determination of the
arithmetic calculation of the Prepayment Price), in addition to any remedy the
Holder may have under this Note and the Purchase Agreement, such unpaid amount
shall bear interest at the rate of two percent (2%) per month (prorated for
partial months) until paid in full. Until the full Mandatory Prepayment Price is
paid in full to the Holder, the Holder may (i) void the Mandatory Prepayment
with respect to that portion of the Note for which the full Mandatory Prepayment
Price has not been paid, (ii) receive back such Note, and (iii) require that the
Conversion Price of such returned Note be adjusted to the lesser of (A) the
Conversion Price as in effect on the date on which the Holder voided the
Mandatory Prepayment and (B) the lowest Closing Bid Price during the period
beginning on the Conversion Date and ending on the date the Holder voided the
Mandatory Prepayment.

                                             (d)                      Pro-rata Conversion and
Prepayment. In the event the Company receives a Conversion Notice from more
than one holder of the Notes on the same day and the Company can convert and
prepay some, but not all, of the Notes pursuant to this Section 3.7, the Company
shall convert and prepay from each holder of the Notes electing to have its
Notes converted and prepaid at such time an amount equal to such holder’s
pro-rata amount (based on the principal amount of the Notes held by such holder
relative to the principal amount of the Notes outstanding) of all the Notes
being converted and prepaid at such time. 

                                             Section 3.8                      No Rights as
Shareholder. Nothing contained in this Note shall be construed as conferring
upon the Holder, prior to the conversion of this Note, the right to vote or to
receive dividends or to consent or to receive notice as a shareholder in respect
of any meeting of shareholders for the election of directors of the Company or
of any other matter, or any other rights as a shareholder of the Company. 

ARTICLE IV 

MISCELLANEOUS 

                                             Section 4.1                      Notices. Any
notice, demand, request, waiver or other communication required or permitted to
be given hereunder shall be in writing and shall be effective (a) upon hand
delivery by telex (with correct answer back received), telecopy or facsimile at
the address or number designated in the Purchase Agreement (if delivered on a
business day during normal business hours where such notice is to be received),
or the first business day following such delivery (if delivered other than on a
business day during normal business hours where such notice is to be received)
or (b) on the second business day following the date of mailing by express
courier service, fully prepaid, addressed to such address, or upon actual
receipt of such mailing, whichever shall first occur. The Company will give
written notice to the Holder at least ten (10) days prior to the date on which
the Company takes a record (x) with respect to any dividend or distribution upon
the Common Stock, (y) with respect to any pro rata subscription offer to holders
of Common Stock or (z) for determining rights to vote with respect to any
Organic Change, dissolution, liquidation or winding-up and in no event shall
such notice be provided to such holder prior to such information being made
known to the public. The Company will also give written notice to the Holder at
least ten (10) days prior to the date on which any Organic Change, dissolution,
liquidation or winding-up will take place and in no event shall such notice be
provided to the Holder prior to such information being made known to the
public.

-16- 

                                             Section 4.2                      Governing Law.
This Note shall be governed by and construed in accordance with the internal
laws of the State of Nevada, without giving effect to any of the conflicts of
law principles which would result in the application of the substantive law of
another jurisdiction. This Note shall not be interpreted or construed with any
presumption against the party causing this Note to be drafted. 

                                             Section 4.3                      Headings.
Article and section headings in this Note are included herein for purposes of
convenience of reference only and shall not constitute a part of this Note for
any other purpose. 

                                             Section 4.4                      Remedies,
Characterizations, Other Obligations, Breaches and Injunctive Relief.
The remedies provided in this Note shall be cumulative and in addition to all
other remedies available under this Note, at law or in equity (including,
without limitation, a decree of specific performance and/or other injunctive
relief), no remedy contained herein shall be deemed a waiver of compliance with
the provisions giving rise to such remedy and nothing herein shall limit a
holder’s right to pursue actual damages for any failure by the Company to comply
with the terms of this Note. Amounts set forth or provided for herein with
respect to payments, conversion and the like (and the computation thereof) shall
be the amounts to be received by the holder thereof and shall not, except as
expressly provided herein, be subject to any other obligation of the Company (or
the performance thereof). The Company acknowledges that a breach by it of its
obligations hereunder will cause irreparable and material harm to the Holder and
that the remedy at law for any such breach may be inadequate. Therefore the
Company agrees that, in the event of any such breach or threatened breach, the
Holder shall be entitled, in addition to all other available rights and
remedies, at law or in equity, to seek and obtain such equitable relief,
including but not limited to an injunction restraining any such breach or
threatened breach, without the necessity of showing economic loss and without
any bond or other security being required.

                                             Section 4.5                      Enforcement
Expenses. The Company agrees to pay all costs and expenses of enforcement of
this Note, including, without limitation, reasonable attorneys’ fees and
expenses. 

                                             Section 4.6                      Binding
Effect. The obligations of the Company and the Holder set forth herein shall
be binding upon the successors and assigns of each such party, whether or not
such successors or assigns are permitted by the terms hereof. 

                                             Section 4.7                      Amendments.
This Note may not be modified or amended in any manner except in writing
executed by the Company and the Holder. 

                                             Section 4.8                      Compliance with
Securities Laws. The Holder of this Note acknowledges that this Note is
being acquired solely for the Holder’s own account and not as a nominee for any
other party, and for investment, and that the Holder shall not offer, sell or
otherwise dispose of this Note. This Note and any Note issued in substitution or
replacement therefor shall be stamped or imprinted with a legend in
substantially the following form: 

“THIS NOTE HAS NOT BEEN REGISTERED
UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE
“ACT”), OR APPLICABLE STATE SECURITIES LAWS, AND MAY
NOT BE SOLD OR TRANSFERRED IN THE ABSENCE OF SUCH REGISTRATION OR RECEIPT BY THE
COMPANY OF AN OPINION OF COUNSEL IN THE FORM, SUBSTANCE AND SCOPE REASONABLY SATISFACTORY TO THE COMPANY THAT THIS NOTE MAY BE SOLD, TRANSFERRED, HYPOTHECATED OR OTHERWISE DISPOSED OF, UNDER AN EXEMPTION FROM REGISTRATION UNDER THE ACT AND SUCH STATE
SECURITIES LAWS.”

-17- 

                                             Section 4.9                      Consent to Jurisdiction. Each of the Company and the Holder (i) hereby irrevocably submits to the exclusive jurisdiction of the State 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 Company 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 4.9 shall affect or limit any right to serve
process in any other manner permitted by law. Each of the Company and the Holder hereby agree that the prevailing party in any suit, action or proceeding arising out of or relating to this Note shall be entitled to reimbursement for reasonable legal
fees from the non-prevailing party. 

                                             Section 4.10                      Parties in Interest. This Note shall be binding upon, inure to the benefit of and be enforceable by the Company, the Holder and their respective successors and permitted assigns. 

                                             Section 4.11                      Failure or Indulgence Not Waiver. No failure or delay on the part of the Holder in the exercise of any power, right or privilege hereunder shall operate as a waiver thereof, nor shall any single or
partial exercise of any such power, right or privilege preclude other or further exercise thereof or of any other right, power or privilege. 

                                             Section 4.12                      Company Waivers. Except as otherwise specifically provided herein, the Company and all others that may become liable for all or any part of the obligations evidenced by this Note, hereby waive
presentment, demand, notice of nonpayment, protest and all other demands’ and notices in connection with the delivery, acceptance, performance and enforcement of this Note, and do hereby consent to any number of renewals of extensions of the
time or payment hereof and agree that any such renewals or extensions may be made without notice to any such persons and without affecting their liability herein and do further consent to the release of any person liable hereon, all without
affecting the liability of the other persons, firms or Company liable for the payment of this Note, AND DO HEREBY WAIVE TRIAL BY JURY. 

                                             (a)                      No delay or omission on the part of the Holder in exercising its rights under this Note, or course of conduct relating hereto, shall operate as a waiver of such rights or any other right of the Holder, nor shall any
waiver by the Holder of any such right or rights on any one occasion be deemed a waiver of the same right or rights on any future occasion. 

                                             (b)                      THE COMPANY ACKNOWLEDGES THAT THE TRANSACTION OF WHICH THIS NOTE IS A PART IS A COMMERCIAL TRANSACTION, AND TO THE EXTENT ALLOWED BY APPLICABLE LAW, HEREBY WAIVES ITS RIGHT TO NOTICE AND HEARING WITH RESPECT TO ANY
PREJUDGMENT REMEDY WHICH THE HOLDER OR ITS SUCCESSORS OR ASSIGNS MAY DESIRE TO USE. 

-18- 

	LITHIUM EXPLORATION GROUP, INC. 
	 	  
	 	  
	By:	
      
	 	Name: 
	 	Title:
  

  -19- 

EXHIBIT A 

WIRE INSTRUCTIONS 

Payee:
                                                                                                                                                                                                                            

Bank:
                                                                                                                                                                                                                              

Address:
                                                                                                                                                                                                                       

                                                                                                                                                                                                                                         

Bank
No.:                                                                                                                                                                                                                        

Account
No.:                                                                                                                                                                                                                  

Account
Name:                                                                                                                                                                                                              

-20- 

FORM OF 

NOTICE OF CONVERSION 

(To be Executed by the Registered Holder in order to Convert the
Note) 

The undersigned hereby irrevocably elects to convert $
________________ of the principal amount of the above Note No. ___ into shares
of Common Stock of Lithium Exploration Group, Inc. according to the conditions
hereof, as of the date written below. 

Date of Conversion:
___________________________________________

Applicable Conversion Price: ____________________________    __

Number of shares of Common Stock beneficially owned or deemed
beneficially owned by the Holder on the Date of Conversion:
___________________________________________

Signature:                                                                                                                                         
___________________________________________

Print
Name:                                                                                              
___________________________________________

Address:                                                                                                                                          
___________________________________________

                                                                                                                                                                                                                                                                                 
 ___________________________________________

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Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00229-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00229-of-00352.parquet"}]]