Lithium Exploration Group, Inc.: Form 10-Q

10-Q 1 form10q.htm QUARTERLY REPORT Lithium Exploration Group, Inc.: Form 10-Q - Filed by newsfilecorp.com

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

Form 10-Q

(Mark One)

[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended March 31, 2011
or

[ ] TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from _____________ to _____________

Commission File Number 333-137481

LITHIUM EXPLORATION GROUP, INC.
(Exact name of registrant as specified in its charter)

Nevada	06-1781911
(State or other jurisdiction of incorporation or organization)	(IRS Employer Identification No.)

3200 N. Hayden Road, Suite 300, Scottsdale, Arizona	85251
(Address of principal executive offices)	(Zip Code)

480-406-8220
(Registrant’s telephone number, including area code)

N/A
(Former name, former address and former fiscal year, if changed since last report)

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.
[X] YES [ ] NO

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).
[ ] YES [ ] NO

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a small reporting company. See the definitions of “large accelerated filer”, “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer [ ]		Accelerated filer [ ]
Non-accelerated filer [ ]	(Do not check if a smaller reporting company)	Smaller reporting company [X]

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act [X] YES [ ] NO

APPLICABLE ONLY TO ISSUERS INVOLVED IN BANKRUPTCY PROCEEDINGS DURING THE PRECEDING FIVE YEARS

Check whether the registrant has filed all documents and reports required to be filed by Sections 12, 13 or 15(d) of the Exchange Act after the distribution of securities under a plan confirmed by a court.
[ ] YES [ ] NO

APPLICABLE ONLY TO CORPORATE ISSUERS

Indicate the number of shares outstanding of each of the issuer’s classes of common stock, as of the latest practicable date. 50,815,476 common shares issued and outstanding as of May 18, 2011

FORM 10-Q
FOR THE QUARTERLY PERIOD ENDED MARCH 31, 2011

TABLE OF CONTENTS

PART I – FINANCIAL INFORMATION			3
	Item 1.	Financial Statements	3
	Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	4
	Item 3.	Quantitative and Qualitative Disclosures About Market Risk	9
	Item 4.	Controls and Procedures	9
PART II – OTHER INFORMATION			9
	Item 1.	Legal Proceedings	9
	Item 1A.	Risk Factors	10
	Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	10
	Item 3.	Defaults Upon Senior Securities	10
	Item 4.	[Removed and Reserved]	10
	Item 5.	Other Information	10
	Item 6.	Exhibits	11
SIGNATURES			12

PART I – FINANCIAL INFORMATION

Item 1. Financial Statements

Our unaudited interim financial statements for the three and nine month periods ended March 31, 2011 form part of this quarterly report. They are stated in United States Dollars (US$) and are prepared in accordance with United States generally accepted accounting principles.

LITHIUM EXPLORATION GROUP, INC.
(formerly Mariposa Resources, Ltd.)

(An Exploration Stage Company)

INTERIM FINANCIAL STATEMENTS

March 31, 2011

(Unaudited)

F-1

Lithium Exploration Group, Inc.

(formerly Mariposa Resources, Ltd.)

(An Exploration Stage Company)

Balance Sheets

		March 31,			June 30,
		2011			2010
		*(Unaudited)*
ASSETS


Current Assets
Cash and cash equivalents	$	42,937		$	441
Prepaid expenses		35,568			200
		78,505			641


Total Assets	$	78,505		$	641


LIABILITIES

Current Liabilities
Accounts payable and accrued liabilities	$	99,844		$	1,500
Due to related party (Note 6)		47,537			36,799

Total Current Liabilities		147,381			38,299

STOCKHOLDERS’ DEFICIT

Capital stock (Note 3)
Authorized: 100,000,000 preferred shares, $0.001 par value 500,000,000 common shares, $0.001 par value

Issued and outstanding:
0 preferred shares		-			-
47,875,000 common shares (June 30, 2010: 47,375,000)		47,875			47,375
Additional paid-in capital		326,625			52,125
Deficit accumulated during the exploration stage		(443,376	)		(137,158	)
Total Stockholders’ Deficit		(68,876	)		(37,658	)

Total Liabilities and Stockholders’ Deficit	$	78,505		$	641

The accompanying notes are an integral part of these financial statements.

F-2

Lithium Exploration Group, Inc.

(formerly Mariposa Resources, Ltd.)

(An Exploration Stage Company)

Statements of Operations

(Unaudited)

														Cumulative from
		Three Months						Nine Months						Inception
		Ended						Ended						(May 31, 2006) to
		March 31,						March 31,						March 31,
		2011			2010			2011			2010			2011

Revenue:	$	-		$	-		$	-		$	-		$	-


Operating Expenses:
Advertising		5,828			-			5,828			-			5,828
Consulting		9,000			-			9,000			-			9,000
General and administrative		5,782			83			5,928			273			15,835
Management fees		22,500			-			22,500			-			22,500
Mining expenses (Note 5)		135,000			-			225,000			-			276,265
Professional fees		18,965			3,210			29,648			17,128			105,634
Transfer agent fees		1,450			-			2,148			-			2,148
Travel		6,166			-			6,166			-			6,166

Total operating expenses		204,691			3,293			306,218			17,401			443,376

Provision for Income Taxes (Note 4)		-			-			-			-			-

Net Loss for the Period	$	(204,691	)	$	(3,293	)	$	(306,218	)	$	(17,401	)	$	(443,376	)

Basic and Diluted Loss per Common Share	$	(0.00	)	$	(0.00	)	$	(0.01	)	$	(0.00	)

Weighted Average Number of Common Shares Outstanding		47,711,111			47,375,000			47,485,401			47,375,000

The accompanying notes are an integral part of these financial statements.

F-3

Lithium Exploration Group, Inc.

(formerly Mariposa Resources, Ltd.)

(An Exploration Stage Company)

Statements of Changes in Stockholders’ Equity (Deficit)

For the Period of Inception (May 31, 2006) to March 31, 2011

	Common Stock

							Deficit
							Accumulated
							During the
	Number of				Additional		Exploration			Stockholders’
	Shares		Amount		Paid-in Capital		Stage			Equity(Deficit)

Inception – May 31, 2006	-	$	-	$	-	$	-		$	-

Common shares issued to a founder at $0.01 cash per share, June 6, 2006	20,000,000		20,000		-		-			20,000

Loss for the period (Unaudited)	-		-		-		(2,687	)		(2,687	)

Balance – June 30, 2006 (Unaudited)	20,000,000		20,000		-		(2,687	)		17,313

Common shares issued to founders at $0.01 per share, July 1, 2006	10,000,000		10,000		-		-			10,000
Common shares issued for cash at $0.04 per share, December 11, 2006	17,375,000		17,375		52,125		-			69,500
Loss for the year (Unaudited)	-		-		-		(59,320	)		(59,320	)
Balance – June 30, 2007 (Unaudited)	47,375,000		47,375		52,125		(62,007	)		37,493

Loss for the year	-		-		-		(22,888	)		(22,888	)
Balance – June 30, 2008	47,375,000		47,375		52,125		(84,895	)		14,605

Loss for the year	-		-		-		(31,624	)		(31,624	)
Balance – June 30, 2009	47,375,000		47,375		52,125		(116,519	)		(17,019	)

Loss for the year	-		-		-		(20,639	)		(20,639	)
Balance – June 30, 2010	47,375,000		47,375		52,125		(137,158	)		(37,658	)

Common shares issued for cash at $1.00 per share, January 27, 2011 (Unaudited)	250,000		250		249,750		-			250,000
Common shares issued for mining expenses (Unaudited)	250,000		250		24,750		-			25,000
Loss for the period (Unaudited)	-		-		-		(306,218	)		(306,218	)
Balance – March 31, 2011 *(Unaudited)*	47,875,000	$	47,875	$	326,625	$	(443,376	)	$	(68,876	)

The accompanying notes are an integral part of these financial statements.

F-4

Lithium Exploration Group, Inc.

(formerly Mariposa Resources, Ltd.)

(An Exploration Stage Company)

Statements of Cash Flows

(Unaudited)

		Nine Months			Nine			Cumulative from
		Ended			Months			Inceptions
		March 31,			Ended			(May 31, 2006) to
		2011			March 31,			March 31,
					2010			2011


Cash Flows from Operating Activities
Net loss for the period	$	(306,218	)	$	(17,401	)	$	(443,376	)
Item not affecting cash:
Common shares issued for mining expenses		25,000			-			25,000

Changes in operating assets and liabilities:
Prepaid expenses		(35,368	)		-			(35,568	)
Accounts payable and accrued liabilities		98,344			(2,896	)		99,844
Net cash used in operations		(218,242	)		(20,297	)		(354,100	)


Cash Flows from Investing Activities
Net cash used in (provided by) investing activities		-			-			-

Cash Flows from Financing Activities
Advance from related party		10,738			22,154			47,537
Issuance of common shares for cash		250,000			-			349,500
Net cash provided by financing activities		260,738			22,154			397,037

Increase in cash and cash equivalents		42,496			1,857			42,937

Cash and cash equivalents - beginning of period		441			132			-

Cash and cash equivalents - end of period	$	42,937		$	1,989		$	42,937

Supplementary Cash Flow Information
Cash paid for:
Interest	$	-		$	-		$	-
Income taxes	$	-		$	-		$	-

The accompanying notes are an integral part of these financial statements.

F-5

Lithium Exploration Group, Inc.

(formerly Mariposa Resources, Ltd.)

(An Exploration Stage Company)

Notes to Interim Financial Statements

March 31, 2011

(Unaudited)

1. Organization

Lithium Exploration Group, Inc (formerly Mariposa Resources, Ltd.) (the “Company”) was incorporated on May 31, 2006 in the State of Nevada, U.S.A. It is based in Scottsdale, Arizona, USA. The accounting and reporting policies of the Company conform to accounting principles generally accepted in the United States of America, and the Company’s fiscal year end is June 30.

Effective November 30, 2010, the Company changed its name to “Lithium Exploration Group, Inc.,” by way of a merger with its wholly-owned subsidiary Lithium Exploration Group, Inc., which was formed solely for the change of name.

The Company is an exploration stage company that engages principally in the acquisition, exploration, and development of resource properties. Prior to June 25, 2009, the Company had the right to conduct exploration work on 20 mineral mining claims in Esmeralda County, Nevada, U.S.A. On July 31, 2009, the Company acquired an option to enter into a joint venture for the management and ownership of the Jack Creek Project, a mining project located in Elko County, Nevada. On September 25, 2009, the joint venture was terminated and the Company entered into an agreement with Beeston Enterprises Ltd., under which the Company was granted an option to acquire an undivided 50% interest in eight mineral claims located in the Clinton Mining District of British Columbia, Canada. On December 16, 2010, the Company entered into an Assignment Agreement to acquire an undivided 100% right, title and interest in and to certain mineral permits located in the Province of Alberta, Canada (see Note 5). On January 18, 2011, the Company entered into a Purchase Option Agreement to acquired an undivided 60% interest in certain mineral claims known as the Salta Aqua Claims located in Salta Province, Argentina (See Note 5). To date, the Company’s activities have been limited to its formation, the raising of equity capital and its mining exploration work program.

Exploration Stage Company

The Company is considered to be in the exploration stage as defined in FASC 915-10-05 “Development Stage Entities,” and interpreted by the Securities and Exchange Commission for mining companies in Industry Guide 7. The Company is devoting substantially all of its efforts to development of business plans and the acquisition of mineral properties.

2. Significant Accounting Policies

Use of Estimates

The preparation of financial statements in conformity with United States generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amount of revenues and expenses during the reporting period. Actual results could differ from those estimates. The Company’s periodic filings with the Securities and Exchange Commission include, where applicable, disclosures of estimates, assumptions, uncertainties and markets that could affect the financial statements and future operations of the Company.

F-6

Lithium Exploration Group, Inc.

(formerly Mariposa Resources, Ltd.)

(An Exploration Stage Company)

Notes to Interim Financial Statements

March 31, 2011

(Unaudited)

2. Significant Accounting Policies - Continued

Cash and Cash Equivalents

Cash and cash equivalents include cash in banks, money market funds, and certificates of term deposits with original maturities of less than three months, which are readily convertible to known amounts of cash and which, in the opinion of management, are subject to an insignificant risk of loss in value. The Company had $42,937 and $441 in cash and cash equivalents at March 31, 2011 and June 30, 2010, respectively.

Start-Up Costs

In accordance with FASC 720-15-20 “Start-Up Costs,” the Company expenses all costs incurred in connection with the start-up and organization of the Company.

Mineral Acquisition and Exploration Costs

The Company has been in the exploration stage since its formation on May 31, 2006 and has not yet realized any revenue from its planned operations. It is primarily engaged in the acquisition, exploration, and development of mining properties. Mineral property acquisition and exploration costs are expensed as incurred. When it has been determined that a mineral property can be economically developed as a result of establishing proven and probable reserves, the costs incurred to develop such property are capitalized. Such costs will be amortized using the units-of-production method over the estimated life of the probable reserves.

Concentrations of Credit Risk

The Company’s financial instruments that are exposed to concentrations of credit risk primarily consist of its cash and cash equivalents and related party payables it will likely incur in the near future. The Company places its cash and cash equivalents with financial institutions of high credit worthiness. At times, its cash and cash equivalents with a particular financial institution may exceed any applicable government insurance limits. The Company’s management plans to assess the financial strength and credit worthiness of any parties to which it extends funds, and as such, it believes that any associated credit risk exposures are limited.

Net Income or (Loss) per Share of Common Stock

The Company has adopted FASC Topic No. 260, “Earnings Per Share,” (“EPS”) which requires presentation of basic and diluted EPS on the face of the income statement for all entities with complex capital structures and requires a reconciliation of the numerator and denominator of the basic EPS computation to the numerator and denominator of the diluted EPS computation. In the accompanying financial statements, basic earnings (loss) per share is computed by dividing net income/loss by the weighted average number of shares of common stock outstanding during the period.

The Company has no potentially dilutive securities, such as options or warrants, currently issued and outstanding.

F-7

Lithium Exploration Group, Inc.

(formerly Mariposa Resources, Ltd.)

(An Exploration Stage Company)

Notes to Interim Financial Statements

March 31, 2011

(Unaudited)

2. Significant Accounting Policies - Continued

Foreign Currency Translations

The Company’s functional and reporting currency is the US dollar. All transactions initiated in other currencies are translated into US dollars using the exchange rate prevailing on the date of transaction. Monetary assets and liabilities denominated in foreign currencies are translated into the US dollar at the rate of exchange in effect at the balance sheet date. Unrealized exchange gains and losses arising from such transactions are deferred until realization and are included as a separate component of stockholders’ equity (deficit) as a component of comprehensive income or loss. Upon realization, the amount deferred is recognized in income in the period when it is realized.

No significant realized exchange gain or losses were recorded from inception (May 31, 2006) to March 31, 2011.

Comprehensive Income (Loss)

FASC Topic No. 220, “Comprehensive Income,” establishes standards for reporting and display of comprehensive income and its components in a full set of general-purpose financial statements. From inception (May 31, 2006) to March 31, 2011, the Company had no items of other comprehensive income. Therefore, net loss equals comprehensive loss from inception (May 31, 2006) to March 31, 2011.

Risks and Uncertainties

The Company operates in the resource exploration industry that is subject to significant risks and uncertainties, including financial, operational, technological, and other risks associated with operating a resource exploration business, including the potential risk of business failure.

Environmental Expenditures

The operations of the Company have been, and may in the future be, affected from time to time in varying degree by changes in environmental regulations, including those for future reclamation and site restoration costs. Both the likelihood of new regulations and their overall effect upon the Company vary greatly and are not predictable. The Company's policy is to meet or, if possible, surpass standards set by relevant legislation by application of technically proven and economically feasible measures.

Environmental expenditures that relate to ongoing environmental and reclamation programs are charged against earnings as incurred or capitalized and amortized depending on their future economic benefits. All of these types of expenditures incurred since inception have been charged against earnings due to the uncertainty of their future recoverability. Estimated future reclamation and site restoration costs, when the ultimate liability is reasonably determinable, are charged against earnings over the estimated remaining life of the related business operation, net of expected recoveries.

F-8

Lithium Exploration Group, Inc.

(formerly Mariposa Resources, Ltd.)

(An Exploration Stage Company)

Notes to Interim Financial Statements

March 31, 2011

(Unaudited)

2. Significant Accounting Policies - Continued

Recent Accounting Pronouncements

Recent accounting pronouncements that are listed below did not, and are not currently expected to, have a material effect on the Company’s financial statements, but will be implemented in the Company’s future financial reporting when applicable.

FASB Statements:

In June 2009 the FASB established the Accounting Standards Codification ("Codification" or "ASC") as the source of authoritative accounting principles recognized by the FASB to be applied by nongovernmental entities in the preparation of financial statements in accordance with generally accepted accounting principles in the United States ("GAAP"). Rules and interpretive releases of the Securities and Exchange Commission ("SEC") issued under authority of federal securities laws are also sources of GAAP for SEC registrants. Existing GAAP was not intended to be changed as a result of the Codification, and accordingly the change did not impact our financial statements. The ASC does change the way the guidance is organized and presented.

“FASB Interpretation No. 46(R)," and SFAS No. 168 (ASC Topic 105), "The FASB Accounting Standards Codification and the Hierarchy of Generally Accepted Accounting Principles-a replacement of FASB Statement No. 162," were recently issued. SFAS No. 165, 166, 167, and 168 have no current applicability to the Company or their effect on the financial statements would not have been significant.

Accounting Standards Update ("ASU") ASU No. 2009-05 (ASC Topic 820), which amends Fair Value Measurements and Disclosures - Overall, ASU No. 2009-13 (ASC Topic 605), Multiple-Deliverable Revenue Arrangements, ASU No. 2009-14 (ASC Topic 985), Certain Revenue Arrangements that include Software Elements, and various other ASU's No. 2009-2 through ASU No. 2011-04 which contain technical corrections to existing guidance or affect guidance to specialized industries or entities were recently issued. These updates have no current applicability to the Company or their effect on the financial statements would not have been significant.

F-9

Lithium Exploration Group, Inc.

(formerly Mariposa Resources, Ltd.)

(An Exploration Stage Company)

Notes to Interim Financial Statements

March 31, 2011

(Unaudited)

3. Capital Stock

Authorized Stock

At inception, the Company authorized 100,000,000 common shares and 100,000,000 preferred shares, both with a par value of $0.001 per share. Each common share entitles the holder to one vote, in person or proxy, on any matter on which action of the stockholders of the corporation is sought.

Effective April 8, 2009, the Company increased the number of authorized shares to 600,000,000 shares, of which 500,000,000 shares are designated as common stock, par value $0.001 per share, and 100,000,000 shares are designated as preferred stock, par value $0.001 per share.

Share Issuances

On January 27, 2011, the Company issued 250,000 shares of common stock in a private placement to two unrelated off-shore investors at $1 per share for total cash proceeds of $250,000.

On February 1, 2011, the Company issued 250,000 common shares at a deemed price of $0.10 per share for mining expenses relating to the Salta Aqua Claims (Note 5).

Effective April 30, 2009, the Company effected a 10 for 1 forward split of its common stock, under which each stockholder of record on that date received ten (10) new shares of the Corporation’s $0.001 par value stock for every one (1) old share outstanding.

Since its inception (May 31, 2006), the Company has issued shares of its common stock as follows, retroactively adjusted to give effect to the 10 for 1 forward split:

				Price Per
Date	Description	Shares		Share		Amount

06/06/06	Shares issued for cash	20,000,000	$	0.001	$	20,000
07/01/06	Shares issued for cash	10,000,000		0.001		10,000
12/11/06	Shares issued for cash	17,375,000		0.004		69,500
01/27/11	Shares issued for cash	250,000		1.000		250,000
02/01/11	Shares issued for mining expenses	250,000		0.100		25,000

	Cumulative Totals	47,875,000			$	374,500

Of these shares, 30,000,000 were issued to directors and officers of the Company. 17,625,000 were issued to independent investors. 250,000 were issued for mining expenses (Note 5). There are no preferred shares outstanding. The Company has no stock option plan, warrants or other dilutive securities.

F-10

Lithium Exploration Group, Inc.

(formerly Mariposa Resources, Ltd.)

(An Exploration Stage Company)

Notes to Interim Financial Statements

March 31, 2011

(Unaudited)

4. Provision for Income Taxes

The Company recognizes the tax effects of transactions in the year in which such transactions enter into the determination of net income, regardless of when reported for tax purposes. Deferred taxes are provided in the financial statements under FASC 718-740-20 to give effect to the resulting temporary differences which may arise from differences in the bases of fixed assets, depreciation methods, allowances, and start-up costs based on the income taxes expected to be payable in future years.

Exploration stage deferred tax assets arising as a result of net operating loss carryforwards have been offset completely by a valuation allowance due to the uncertainty of their utilization in future periods. Operating loss carryforwards generated during the period from May 31, 2006 (date of inception) through March 31, 2011 of $443,376 will begin to expire in 2026. Accordingly, deferred tax assets of approximately $155,000 were offset by the valuation allowance that increased by approximately $107,000 and $6,100 during the nine months ended March 31, 2011 and 2010, respectively.

The Company follows the provisions of uncertain tax positions as addressed in FASC 740-10-65-1. The Company recognized approximately no increase in the liability for unrecognized tax benefits.

The Company has no tax position at March 31, 2011 for which the ultimate deductibility is highly certain but for which there is uncertainty about the timing of such deductibility. The Company recognizes interest accrued related to unrecognized tax benefits in interest expense and penalties in operating expenses. No such interest or penalties were recognized during the periods presented. The Company had no accruals for interest and penalties at March 31, 2011. The Company’s utilization of any net operating loss carry forward may be unlikely as a result of its intended exploration stage activities.

F-11

Lithium Exploration Group, Inc.

(formerly Mariposa Resources, Ltd.)

(An Exploration Stage Company)

Notes to Interim Financial Statements

March 31, 2011

(Unaudited)

5. Mineral Property Costs

Mineral Claims, Clinton Mining District

On September 25, 2009, and amended June 24, 2010, the Company entered into an Option Agreement under which the Company was granted an option to acquire an undivided 50% interest in eight mineral claims located in the Clinton Mining District, Province of British Columbia, Canada (the “Claims”), which Claims total in excess of 3,900 hectares, in consideration of the issuance of 1,500,000 common shares of the Company on or before December 31, 2010. The Claims are subject to a two percent net smelter royalty which can be paid out for the sum of $1,000,000 (CAD). The Company can earn an undivided 50% interest in the Claims by carrying out a $100,000 (CAD) exploration and development program on the Claims on or before December 31, 2010, plus an additional $200,000 (CAD) exploration and development program on the Claims on or before September 25, 2011.

In the event that the Company acquires an interest in the Claims, the Company and the Optionor have further agreed, at the request of either party, to negotiate a joint venture agreement for further exploration and development of the Claims. As of March 31, 2011, the Company has not issued any stock or carried out any exploration or development programs.

Mineral Permit

On December 16, 2010, the Company entered into an Assignment Agreement to acquire the following

An undivided 100% right, title and interest in and to certain mineral permits located in the Province of Alberta, Canada.

All of the assignor’s right, title and interest in and to the Option Agreement.

In consideration for the Assignment, the Company agreed to pay US$90,000 by way of cash or stock of equal value (consisting of amounts previously paid by the Assignor pursuant to the Option Agreement). The full $90,000 (consisting of option payments ‘i’ and ‘vi’ below) was expensed and included in the March 31, 2011 accounts payable balance. The Option shall be in good standing and exercisable by the Company by paying the following amounts on or before the dates specified in the following schedule:

	i. )	CDN $40,000 (paid) upon execution of the agreement;
	ii. )	CDN $60,000 on or before January 1, 2012;
	iii. )	CDN $100,000 on or before January 1, 2013;
	iv. )	CDN $300,000 on or before January 1, 2014; and
	v. )	Paying all such property payments as may be required to maintain the mineral permits in good standing.

The Optionee shall provide a refundable amount of CDN$50,000 (paid) to the Optionor by November 2, 2010, which shall be applied by the Optionor towards work assessment expenses acceptable to the Government of Alberta, with any unused portion to be applied against payments required to maintain the permits underlying the property in good standing. This amount was paid on December 31, 2010.

F-12

Lithium Exploration Group, Inc.

(formerly Mariposa Resources, Ltd.)

(An Exploration Stage Company)

Notes to Interim Financial Statements

March 31, 2011

(Unaudited)

5. Mineral Property Costs - Continued

Mineral Claims, Salta Agua Claims

By agreement dated January 18, 2011, the Company entered into a Purchase Option Agreement to acquire an undivided 60% interest in certain mineral claims known as the Salta Agua Claims located in Salta Province, Argentina.

To earn an undivided 60% interest in the Property, the Company must:

i)	pay to the Optionor a total of US$375,000 as follows:

	a)	US$25,000 (paid) upon execution of the agreement;
	b)	US$50,000 (paid) within thirty days after the effective date;
	c)	US$100,000 on or before January 18, 2012;
	d)	US$100,000 on or before January 18, 2013;
	e)	US$100,000 on or before January 18, 2014;

ii)	allot and issue to the Optionor, up to a total of 1,000,000 common shares as follows:

	a)	250,000 Shares within thirty days after the effective date (issued)(Note 3);
	b)	250,000 Shares on or before January 18, 2012;
	c)	250,000 Shares on or before January 18, 2013;
	d)	250,000 Shares on or before January 18, 2014;

iii)	incur Exploration Expenditures of not less than a cumulative total of US$4,000,000 as follows:

	a)	US$250,000 on or before the January 18, 2013;
	b)	US$500,000 on or before January 18, 2014;
	c)	US$1,250,000 on or before the January 18, 2015;
	d)	US$2,000,000 on or before the January 18, 2016.

Upon completion of the above terms, the Company will acquire the remaining 40% interest in the Property by paying the sum of $6,000,000, payable either in a lump sum due 180 days later, or by paying $3,000,000 at such time and $3,000,000 plus interest at the rate of LIBOR plus 5% interest 12 months later.

Upon the commencement of Commercial Production, the Company will pay to the Optionor a Royalty of 3% Gross Returns.

F-13

Lithium Exploration Group, Inc.

(formerly Mariposa Resources, Ltd.)

(An Exploration Stage Company)

Notes to Interim Financial Statements

March 31, 2011

(Unaudited)

5. Mineral Property Costs - Continued

Glottech Technology

On March 17, 2011, the Company entered into a letter agreement to acquire one initial unit of proprietary and patented mechanical ultrasound technology for use in water purification, inclusive of its process of separating from water, as the primary fluid stock, the salt and other minerals and by –products contained therein.

To acquire the unit, the Company must make the following payments:

	a)	US$25,000 upon execution of the agreement (paid);
	b)	US$75,000 within 180 days of execution of the agreement;
	c)	US$700,000 within 10 days of receipt of invoice from Glottech –USA LLC if the payment in b) is made.

Commencing as of the end of an initial sixty day testing and training period following satisfactory delivery and physical setup of the technology, and continuing thereafter for as long as the technology remains in the possession of the Company, the Company shall pay continuing monthly royalties in an amount equal to $2.00 per physical ton of water processed pursuant to the usage of the technology.

6. Due to Related Party

As of March 31, 2011 and June 30, 2010, the Company was obligated to a director, who is also an officer and stockholder, for a non-interest bearing demand loan with a balance of $47,537 and $36,799, respectively. The Company plans to pay the loan back as cash flows become available.

7. Going Concern and Liquidity Considerations

The accompanying financial statements have been prepared assuming that the Company will continue as a going concern, which contemplates, among other things, the realization of assets and satisfaction of liabilities in the normal course of business. As at March 31, 2011, the Company had a working capital deficiency of $68,876 and an accumulated deficit of $443,376. The Company intends to fund operations through equity financing arrangements, which may be insufficient to fund its capital expenditures, working capital and other cash requirements for the next twelve months.

The ability of the Company to emerge from the exploration stage is dependent upon, among other things, obtaining additional financing to continue operations, explore and develop the mineral properties and the discovery, development and sale of ore reserves.

In response to these problems, management intends to raise additional funds through public or private placement offerings.

These factors, among others, raise substantial doubt about the Company’s ability to continue as a going concern. The accompanying financial statements do not include any adjustments that might result from the outcome of this uncertainty.

F-14

Lithium Exploration Group, Inc.

(formerly Mariposa Resources, Ltd.)

(An Exploration Stage Company)

Notes to Interim Financial Statements

March 31, 2011

(Unaudited)

8. Subsequent Events

Subsequent to March 31, 2011 the Company issued the following common stock:

1.	On April 28, 2011, the Company issued 190,476 shares of common stock in a private placement to an unrelated off-shore investor at $5.25 per share for total cash proceeds of $1,000,000.

2.	On April 28, 2011, the Company issued 2,300,000 shares of common stock for directors’ fees.

3.	On April 28, 2011, the Company issued 200,000 shares of common stock for settlement of debt.

4.	On April 28, 2011, the Company issued 250,000 shares of common stock for finder’s fees with regards to the acquisition of the Salta Agua Claims.

The Company has evaluated subsequent events from March 31, 2011 through the date of this report, and determined there are no additional items to disclose.

F-15

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations

FORWARD-LOOKING STATEMENTS

This quarterly report contains forward-looking statements. These statements relate to future events or our future financial performance. In some cases, you can identify forward-looking statements by terminology such as “may”, “should”, “expects”, plans”, “anticipates”, “believes”, “estimates”, “predicts”, “potential” or “continue” or the negative of these terms or other comparable terminology. These statements are only predictions and involve known and unknown risks, uncertainties and other factors, that may cause our or our industry’s actual results, levels of activity, performance or achievements to be materially different from any future results, levels of activity, performance or achievements expressed or implied by these forward-looking statements. Although we believe that the expectations reflected in the forward-looking statements are reasonable, we cannot guarantee future results, levels of activity, performance or achievements. Except as required by applicable law, including the securities laws of the United States, we do not intend to update any of the forward-looking statements to conform these statements to actual results.

Our unaudited financial statements are stated in United States Dollars (US$) and are prepared in accordance with United States Generally Accepted Accounting Principles. The following discussion should be read in conjunction with our financial statements and the related notes that appear elsewhere in this quarterly report. The following discussion contains forward-looking statements that reflect our plans, estimates and beliefs. Our actual results could differ materially from those discussed in the forward-looking statements. Factors that could cause or contribute to such differences include, but are not limited to, those discussed below and elsewhere in this quarterly report.

Our financial statements are stated in United States Dollars (US$) and are prepared in accordance with United States Generally Accepted Accounting Principles.

Unless otherwise specified in this quarterly report, all dollar amounts are expressed in United States dollars and all references to “common stock” refer to shares of our common stock.

As used in this quarterly report, the terms “we”, “us”, “our”, and “our company” mean Lithium Exploration Group, Inc., unless otherwise indicated. We have no subsidiaries.

Corporate Overview

We were incorporated on May 31, 2006 under the name Mariposa Resources, Ltd. in the State of Nevada, USA. Our company is based in Scottsdale, Arizona, USA.

Effective November 30, 2010, we changed our name to Lithium Exploration Group, Inc. by way of a merger with our wholly owned subsidiary Lithium Exploration Group, Inc., which was formed solely for the change of name.

We are an exploration stage company that engages principally in the acquisition, exploration, and development of resource properties. Prior to June 25, 2009, we had the right to conduct exploration work on 20 mineral mining claims in Esmeralda County, Nevada, USA. On July 31, 2009, we acquired an option to enter into a joint venture for the management and ownership of the Jack Creek Project, a mining project located in Elko County, Nevada. On September 25, 2009, the joint venture was terminated and we entered into an agreement with Beeston Enterprises Ltd., under which our company was granted an option to acquire an undivided 50% interest in eight mineral claims located in the Clinton Mining District of British Columbia, Canada. On February 14, 2011 we sent notice to Beeston to terminate the option agreement.

On December 16, 2010, we entered into an assignment agreement to acquire an undivided 100% right, title and interest in and to certain mineral permits located in the Province of Alberta, Canada. To date, our activities have been limited to our formation, the raising of equity capital and our mining exploration work program.

On January 18, 2011, we entered into a purchase option agreement with Salta Water Co. and we have acquired a 60% interest on the Salta Aqua claims in Salta Province, Argentina. We have a further option to acquire the remaining 40% interest from Salta Water. On February 1, 2011, we issued 250,000 common shares at a deemed price of $0.10 per share for mining expenses relating to the Salta Aqua Claims. The price of the issued shares was based on the market price of the shares on January 31, 2011.

On March 17, 2011, we entered into a letter agreement between our company and Glottech-USA, LLC for an acquisition of one initial unit of certain proprietary and patented mechanical ultrasound technology for use in the water treatment in regards to our lithium operations in Alberta, Canada. Pursuant to the terms of the agreement, Glottech-USA will assemble and ship to our company one unit of the technology specifically designed for our water treatment purposes and will license the use of the technology. Furthermore, we have agreed that in the event that we have purchased a minimum of five technology units within twelve months from the date of execution, Glottech-USA has agreed that it will neither license nor lease the technology to any third party for use in the country of Canada.

In exchange for the acquisition of the technology, we have agreed to pay to Glottech-USA a licensing and technology payment in the amount of $800,000 as follows:

	(i)	$25,000 upon execution of the agreement;

	(ii)	$75,000 within 180 days of the date of execution which shall serve as confirmation by the company of its intent to formally proceed with the intent of the agreement (the “confirmation payment”);

	(iii)	$700,000 with 10 days of receipt of invoice from Glottech-USA to cover the cost of components and assembly for one technology unit; and

	(iv)	monthly royalties, to be paid within 15 calendar days from the receipt of the invoice, in an amount of $2.00 per physical ton of water processed pursuant to the usage of the technology following satisfactory delivery and physical setup of the technology and continuing thereafter for as long as the technology remains in our possession.

Concurrent with the confirmation payment, we agree to issue 2,000,000 shares of our common stock to Glottech-USA’s designee(s) in consideration of the preferential royalty payment structure, the territorial licensing and limited exclusivity provisions of the agreement. The share issuance to Glottech-USA will come from the total of 10 million shares that have been pledged to our company from our president, Alex Walsh. As of March 31, 2011 the shares have not been issued.

Results of Operations

We have generated no revenues since inception and have incurred $204,691 and $306,218, respectively, in expenses for the three and nine month periods ended March 31, 2011.

The following provides selected financial data about our company for the three and nine month periods ended March 31, 2011 and 2010.

Three months ended March 31, 2011 and 2010.

		Three months			Three months
		ended			ended
		March 31, 2011			March 31, 2010
Revenue	$	Nil		$	Nil
Operating Expenses	$	204,691		$	3,293
Net Loss	$	(204,691	)	$	(3,293	)

Operating expenses for the three months ended March 31, 2011 increased as a result of an increase in our operating expenses including $5,828 in advertising expenses, $9,000 in consulting fees, $5,782 in general and administrative expenses, $22,500 in management fees, $135,000 in mining expenses, $18,965 in professional fees, $1,450 in transfer agent fees and $6,166 in travel expenses.

Nine months ended March 31, 2011 and 2010.

		Nine months			Nine months
		ended			ended
		March 31, 2011			March 31, 2010
Revenue	$	Nil		$	Nil
Operating Expenses	$	306,218		$	17,401
Net Loss	$	(306,218	)	$	(17,401	)

Operating expenses for the nine months ended March 31, 2011 increased as a result of an increase in our operating expenses including $5,828 in advertising expenses, $9,000 in consulting fees, $5,928 in general and administrative expenses, $22,500 in management fees, $225,000 in mining expenses, $29,648 in professional fees, $2,148 in transfer agent fees and $6,166 in travel expenses.

Liquidity and Capital Resources

The following table provides selected financial data about our company as of March 31, 2011, and June 30, 2010, respectively.

	As at		As at
	March 31, 2011		June 30, 2010
Total assets	78,505		641
Total liabilities	147,381		38,299
Stockholders’ deficit	(68,876	)	(37,658	)

Cash Flows

	Nine Months		Nine Months
	ended		ended
	March 31, 2011		March 31, 2010
Net cash used in operating activities	(218,242	)	(20,297	)
Net cash used in investing activities	Nil		Nil
Net cash provided by financing activities	260,738		22,154
Increase (Decrease) in cash	42,496		1,857

We had cash of $42,937 as of March 31, 2011 as compared to cash of $441 as of June 30, 2010. We had a working capital deficit of $68,876 as of March 31, 2011 compared to a working capital deficit of $37,658 as June 30, 2010.

The report of our auditors on our audited financial statements for the fiscal year ended June 30, 2010, contains a going concern qualification as we have suffered losses since our inception. We have minimal assets and have achieved no operating revenues since our inception. We have depended on loans and sales of equity securities to conduct operations. Unless and until we commence material operations and achieve material revenues, we will remain dependent on financings to continue our operations.

Plan of Operation

You should read the following discussion of our financial condition and results of operations together with our unaudited financial statements and the notes thereto included elsewhere in this filing. Our unaudited financial statements have been prepared in accordance with accounting principles generally accepted in the United States. This discussion contains forward-looking statements that reflect our plans, estimates and beliefs. Our actual results could differ materially from those anticipated in these forward-looking statements.

Anticipated Cash Requirements

We estimate that our expenses over the next 12 months will be approximately $129,000 as described in the table below. These estimates may change significantly depending on the nature of our future business activities and our ability to raise capital from shareholders or other sources.

Description	Estimated Completion Date	Estimated Expenses ($)
General and administrative	12 months	24,000
Mining expenses	12 months	160,000
Professional fees	12 months	5,000
Total		$129,000

We intend to meet our cash requirements for the next 12 months through a combination of debt financing and equity financing by way of private placements. We currently do not have any arrangements in place to complete any private placement financings and there is no assurance that we will be successful in completing any such financings on terms that will be acceptable to us.

We were incorporated in the State of Nevada on May 31, 2006. We were formed to engage in the search for mineral deposits or reserves. We conducted preliminary exploration activities on certain properties in Esmeralda County, Nevada on which we held certain mining claims. On September 25, 2009, amended June 24, 2010, we were granted an option to acquire an undivided 50% interest in eight mineral claims located in the Clinton Mining District of British Columbia, Canada, representing 3,900 hectares. On February 14, 2011 we sent notice to Beeston to terminate the option agreement related to the mineral claims located in the Clinton Mining District. On December 16, 2010, we entered into an assignment agreement to acquire an undivided 100% right, title and interest in and to certain mineral permits located in the Province of Alberta, Canada.

On March 17, 2011, we entered into a letter agreement with Glottech-USA, LLC for an acquisition of one initial unit of certain proprietary and patented mechanical ultrasound technology for use in the water treatment in regards to our lithium operations in Alberta, Canada. In exchange for the acquisition of the technology, we have agreed to pay to Glottech-USA a licensing and technology payment in the aggregate amount of $800,000 which includes a confirmation payment of $75,000. Concurrently with the confirmation payment, we will issue 2,000,000 shares of our common stock to Glottech-USA’s designee(s) in consideration of the preferential royalty payment structure, the territorial licensing and limited exclusivity provisions of the agreement. The share issuance to Glottech-USA will come from the total of 10 million shares that have been pledged to our company from our president, Alex Walsh. As of March 31, 2011 these shares have not been issued. As a result of the acquisitions the Company has changed its business direction and is focused on the development of the Lithium assets.

We have minimal operating costs and expenses at the present time due to our limited business activities. However, because of our limited cash in the bank, we will be required to raise additional capital over the next twelve months to meet our ongoing expenses, including our costs related to the remaining required payments under the assignment agreement, as entered into on December 16, 2010 and the purchase option agreement, as entered into on January 18, 2011.

Further, we may raise capital in connection with or in anticipation of possible acquisition transactions. We do not currently engage in any product research and development and have no plans to do so in the foreseeable future. We have no present plans to purchase or sell any plant or significant equipment. We also have no present plans to add employees, although we may do so in the future if we engage in any merger or acquisition transactions.

Off-Balance Sheet Arrangements

At March 31, 2011, we had no off-balance sheet arrangements that have or are reasonably likely to have a current or future effect on our financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources that are material to stockholders.

Inflation

The amounts presented in the financial statements do not provide for the effect of inflation on our operations or financial position. The net operating losses shown would be greater than reported if the effects of inflation were reflected either by charging operations with amounts that represent replacement costs or by using other inflation adjustments.

Critical Accounting Policies and Estimates

Use of Estimates

The preparation of financial statements in conformity with United States generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amount of revenues and expenses during the reporting period. Actual results could differ from those estimates. Our company’s periodic filings with the Securities and Exchange Commission include, where applicable, disclosures of estimates, assumptions, uncertainties and markets that could affect the financial statements and future operations of our company.

Mineral Acquisition and Exploration Costs

Our company has been in the exploration stage since its formation on May 31, 2006 and has not yet realized any revenue from its planned operations. It is primarily engaged in the acquisition, exploration, and development of mining properties. Mineral property acquisition and exploration costs are expensed as incurred. When it has been determined that a mineral property can be economically developed as a result of establishing proven and probable reserves, the costs incurred to develop such property are capitalized. Such costs will be amortized using the units-of-production method over the estimated life of the probable reserves.

Risks and Uncertainties

Our company operates in the resource exploration industry that is subject to significant risks and uncertainties, including financial, operational, technological, and other risks associated with operating a resource exploration business, including the potential risk of business failure.

Environmental Expenditures

The operations of our company have been, and may in the future be, affected from time to time in varying degree by changes in environmental regulations, including those for future reclamation and site restoration costs. Both the likelihood of new regulations and their overall effect upon our company vary greatly and are not predictable. Our company's policy is to meet or, if possible, surpass standards set by relevant legislation by application of technically proven and economically feasible measures.

Item 3. Quantitative and Qualitative Disclosures About Market Risk

As a “smaller reporting company”, we are not required to provide the information required by this Item.

Item 4. Controls and Procedures

Management’s Report on Disclosure Controls and Procedures

We maintain disclosure controls and procedures that are designed to ensure that information required to be disclosed in our reports filed under the Securities Exchange Act of 1934, as amended, is recorded, processed, summarized and reported within the time periods specified in the Securities and Exchange Commission's rules and forms, and that such information is accumulated and communicated to our management, including our president (our principal executive officer, principal financial officer and principle accounting officer) to allow for timely decisions regarding required disclosure.

As of March 31, 2011, the end of the quarter covered by this report, we carried out an evaluation, under the supervision and with the participation of our president (our principal executive officer, principal financial officer and principle accounting officer), of the effectiveness of the design and operation of our disclosure controls and procedures. Based on the foregoing, our president (our principal executive officer, principal financial officer and principle accounting officer) concluded that our disclosure controls and procedures were effective as of the end of the period covered by this quarterly report.

Changes in Internal Control over Financial Reporting

There have been no changes in our internal controls over financial reporting that occurred during the quarter ended March 31, 2011 that have materially or are reasonably likely to materially affect, our internal controls over financial reporting.

PART II – OTHER INFORMATION

Item 1. Legal Proceedings

We know of no material, existing or pending legal proceedings against our company, nor are we involved as a plaintiff in any material proceeding or pending litigation. There are no proceedings in which any of our directors, officers or affiliates, or any registered beneficial shareholder, is an adverse party or has a material interest adverse to our interest.

Item 1A. Risk Factors

As a “smaller reporting company”, we are not required to provide the information required by this Item.

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds

On January 27, 2011, we issued an aggregate of 250,000 shares of our common stock in a private placement, raising gross proceeds of $250,000, or $1.00 per share. We have issued the shares to two non-US persons (as that term is defined in Regulation S of the Securities Act of 1933) in an offshore transaction relying on Regulation S and/or Section 4(2) of the Securities Act of 1933.

On February 1, 2011, we issued 250,000 common shares at a deemed price of $0.10 per share for mining expenses relating to the Salta Aqua Claims. The shares were issued relying on Section 4(2) of the Securities Act of 1933.

On April 28, 2011, we issued 190,476 shares of common stock in a private placement raising gross proceeds of $1,000,000 or $5.25 per share. We have issued the shares to a non-US person (as that term is defined in Regulation S of the Securities Act of 1933) in an offshore transaction relying on Regulation S and/or Section 4(2) of the Securities Act of 1933.

On April 28, 2011, we issued 2,300,000 shares of common stock at the deemed price of $5.25 per share for directors’ fees. We have issued the shares pursuant to an exemption from registration relying on Section 4(2) of the Securities Act of 1933.

On April 28, 2011, we issued 200,000 shares of common stock for settlement of debt. We have issued the shares pursuant to an exemption from registration relying on Section 4(2) of the Securities Act of 1933.

On April 28, 2011, we issued 250,000 shares of common stock for finder’s fees with regards to the acquisition of the Salta Agua Claims. We have issued the shares to two non-US persons (as that term is defined in Regulation S of the Securities Act of 1933) in an offshore transaction relying on Regulation S and/or Section 4(2) of the Securities Act of 1933.

Item 3. Defaults Upon Senior Securities

None.

Item 4. [Removed and Reserved]

Item 5. Other Information

On January 21, 2011 we appointed Brandon Colker and Jonathan Jazwinski as directors of our company.

Item 6. Exhibits

Exhibit	Description
No.
(3)	(i) Articles of Incorporation; and (ii) Bylaws
3.1	Articles of Incorporations (incorporated by reference to our Registration Statement on Form SB-2 filed on September 20, 2006).
3.2	Bylaws (incorporated by reference to our Registration Statement on Form SB-2 filed on September 20, 2006).
3.3	Articles of Amendment dated May 31, 2006 (incorporated by reference to our Current Report on Form 8-K filed on April 21, 2009).
3.4	Certificate of Amendment dated April 8, 2009 (incorporated by reference to our Current Report on Form 8-K/A filed on April 23, 2009).
3.5	Articles of Merger dated November 17, 2010 (incorporated by reference to our Current Report on Form 8-K filed on December 7, 2010).
(10)	Material Contracts
10.1	Option to Enter Joint Venture Agreement between our company and USA Uranium Corp. dated July 31, 2009 (incorporated by reference to our Current Report on Form 8-K filed on August 5, 2009).
10.2	Assignment Agreement between our company and Lithium Exploration VIII Ltd. dated December 16, 2010 (incorporated by reference to our Current Report on Form 8-K filed on January 10, 2011).
10.3	Purchase Option Agreement between our company and Salta Water Co. dated January 18, 2011 (incorporated by reference to our Current Report on Form 8-K filed on February 2, 2011).
10.4	Letter Agreement between our company and Glottech-USA, LLC dated March 17, 2011 (incorporated by reference to our Current Report on Form 8-K filed on May 4, 2011).
(31)	Rule 13a-14(a)/15d-14(a) Certification
31.1*	Section 302 Certification under Sarbanes-Oxley Act of 2002 of the Principal Executive Officer, Principal Financial Officer and Principal Accounting Officer.
(32)	Section 1350 Certification
32.1*	Section 906 Certification under Sarbanes-Oxley Act of 2002 of the Principal Executive Officer, Principal Financial Officer and Principal Accounting Officer.

* Filed herewith.

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

	LITHIUM EXPLORATION GROUP, INC.
	(Registrant)


Date: May 18, 2011	/s/ Alexander Walsh
	Alexander Walsh
	President, Secretary, Treasurer and Director
	(Principal Executive Officer, Principal Financial Officer,
	Principal Accounting Officer)