Power Conversion Technologies, Inc. entered into a binding letter of intent to acquire Elite Group, Inc. (OTCPK:ELTZ) in a reverse merger transaction on December 18, 2019. Under the terms of the transaction, Elite Group will issue its 19,000 shares of Series A, 20,000 shares of Series B and 500 shares of Series C shares to seller in the transaction. In addition, Elite Group shall pay an amount equal to $600,000 to PCTI which may be paid in multiple tranches with the total payment amount being paid in full at the latest upon execution of the definitive agreement or at such other date as shall be specified by the parties.

The Parties acknowledge that any breach by any of PCTI and/or the Shareholders of any of their respective obligations an initial penalty equal to $0.5 million to be paid by Shareholders and/or PCTI. The parties agree that this LOI and the execution of a definitive agreement is subject to and contingent upon Elite Group having first declared itself satisfied with the results of its due diligence of PCTI within a period of 60 days from the date of the execution of this Binding LOI. The Parties further undertake that prior to the closing, each of Elite Group and PCTI shall have obtained all requisite consents and approvals including, without limitation, board of director approval and shareholder consent, as are necessary for the approval of the transaction, and the execution of all related documents including, without limitation, the definitive agreement.