Lithium Energy Products Inc. (TSXV:LEP) entered into a binding letter of intent to acquire American Strategic Minerals Inc. for CAD 3.4 million on January 17, 2019. As per the terms of letter of intent, Lithium Energy Products Inc. will acquire 100% of the assets of American Strategic Minerals Inc. including The Lost Sheep Mining Operations. Further to the terms of the letter of intent, Lithium Energy will move towards a definitive agreement upon completion of its due diligence on the Lost Sheep. Under the terms of consideration for letter of intent, Lithium Energy will issue one common share of Lithium Energy for every two common shares of American Strategic Minerals to acquire the Lost Sheep mine. In addition, the Lithium Energy agrees to issue the American Strategic Minerals, a half (1/2) warrant for every Lithium Energy share issued to American Strategic Minerals, priced at CAD 0.16. The warrant will be valid for two calendar years, from the date of closing.

As on April 1, 2019, Lithium Energy Products Inc. (TSXV:LEP) entered into a definitive agreement to acquire American Strategic Minerals. The transaction is now structured as Lithium Energy acquiring all the shares of American Strategic Minerals in a three-cornered amalgamation arrangement whereby American Strategic Minerals will receive one share of Lithium Energy and one half warrant at an exercise price of CAD 0.16 each for every two American Strategic Minerals shares. Existing American Strategic Minerals options will be terminated and holders will receive replacement options in Lithium Energy. As of the signing of agreement, American Strategic Minerals had 28.37 million shares outstanding and issued. Post-closing, American Strategic Minerals shareholders will own approximately 51% shareholding in the combined entity. Lithium Energy intends to get a name change to ‘Ares Miling' on completion of the transaction. Subsequent to entering into the agreement, and at the last annual general meeting held on October 23, 2019, Karl Marek and Raul Sanabria were appointed to the Board of Directors of Lithium Energy, both of whom are also Directors of American Strategic Minerals. As of January 6, 2020, Lithium Energy Products successfully arranged a bridge financing consisting of the issuance of 2.5 million common shares of Lithium at a price of CAD 0.08 per Common Share with 1.25 million warrants attached with an exercise price of CAD 0.15, valid for two years from the closing of the financing. Lithium Energy is also arranging non -brokered private placement of up to CAD 3.5 million as announced on November 19, 2019.

As of January 29, 2020, the transaction terms have been amended. On the closing of the transaction, and assuming 22.5 million Lithium shares are issued in the financing and 5.9 million Lithium shares are issued in the debt settlement, Lithium Energy anticipates that there will be a total of 58.5 million Lithium Energy shares issued and outstanding on a non-diluted basis with 27.5% held by current Lithium Energy shareholders, 38.4% held by investors in the financing, 9.7% held by creditors participating in the debt settlement and 24.4% held by current shareholders of American Strategic Minerals.

The transaction is subject upon completion of its due diligence on the project. The transaction is subject to approval of Board and shareholders of Marathon Patent Group, Inc., and Lithium Energy and completion of all required exchange filings, the approval of the TSXV, non-brokered private placement (Financing) and shares for debt arrangement to settle an aggregate of CAD 0.45 million bona fide debt owed by Lithium Energy to certain creditors through the issuance of up to 5.7 million Lithium Energy Units. As of February 10, 2020, the transaction has been conditionally approved by TSX Venture Exchange. Sprott Capital Partners acted as financial advisor to Lithium Energy in the transaction.