SEC Info℠

Home

Search

My Interests

Help

Sign In

Please Sign In

First Phosphate Corp. – ‘20FR12G’ on 12/15/23

On:  Friday, 12/15/23, at 11:10am ET   ·   Accession #:  1753926-23-1580   ·   File #:  0-54260

Previous ‘20FR12G’:  None   ·   Next:  ‘20FR12G’ on 3/12/24   ·   Latest:  ‘20FR12G/A’ on 4/18/24   ·   1 Reference:  By:  First Phosphate Corp. – Latest ‘20FR12G/A’ on 4/18/24

in

this entire Filing. an “Entity” Search.

Show

Documents searched

and

each “hit”. the 1st “hit”.

↓↑Hints

 Text Wildcards:  ? (any letter/digit),  * (many).  Search Logic:  for Documents:  & (and),  | (or);  for Text:  | (anywhere),  "(&)" (near).  Details... 

  As Of               Filer                 Filing    For·On·As Docs:Size             Issuer                      Filing Agent

12/15/23  First Phosphate Corp.             20FR12G               20:23M                                    Genesis Filings LLC/FA

Document/Exhibit                   Description                      Pages   Size 

 1: 20FR12G     Registration Statement by a Foreign Non-Canadian    HTML   1.92M 
                Issuer                                                           
 2: EX-1.1      Underwriting Agreement or Conflict Minerals Report  HTML    639K 
 3: EX-1.2      Underwriting Agreement or Conflict Minerals Report  HTML      9K 
 4: EX-1.3      Underwriting Agreement or Conflict Minerals Report  HTML    437K 
 5: EX-1.4      Underwriting Agreement or Conflict Minerals Report  HTML   1.10M 
 6: EX-4.1      Instrument Defining the Rights of Security Holders  HTML    436K 
15: EX-4.10     Instrument Defining the Rights of Security Holders  HTML    326K 
16: EX-4.11     Instrument Defining the Rights of Security Holders  HTML     82K 
17: EX-4.12     Instrument Defining the Rights of Security Holders  HTML     82K 
 7: EX-4.2      Instrument Defining the Rights of Security Holders  HTML     55K 
 8: EX-4.3      Instrument Defining the Rights of Security Holders  HTML    485K 
 9: EX-4.4      Instrument Defining the Rights of Security Holders  HTML    494K 
10: EX-4.5      Instrument Defining the Rights of Security Holders  HTML    470K 
11: EX-4.6      Instrument Defining the Rights of Security Holders  HTML    507K 
12: EX-4.7      Instrument Defining the Rights of Security Holders  HTML    144K 
13: EX-4.8      Instrument Defining the Rights of Security Holders  HTML     47K 
14: EX-4.9      Instrument Defining the Rights of Security Holders  HTML    221K 
20: EX-17.1     Correspondence re: Departure of a Director          HTML   4.28M 
18: EX-15.1     Letter re: Unaudited Interim Financial Info         HTML     10K 
19: EX-15.2     Letter re: Unaudited Interim Financial Info         HTML     12K 

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

FORM 20-F

OR 

OR 

OR

Securities registered or to be registered pursuant to Section 12(g) of the Act: Common Shares, without par value

Securities for which there is a reporting obligation pursuant to Section 15(d) of the Act: None

Indicate the number of outstanding shares of each of the issuer’s classes of capital or common stock as of the close of the period covered by the annual report: Not applicable.

Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. Yes ☐ No ☒

If this report is an annual or transition report, indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934. Yes ☐ No ☐

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 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. 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, or a non-accelerated filer. See the definition of “accelerated filer” and “large accelerated filer” in Rule 12b-2 of the Exchange Act.

Indicate by check mark which basis of accounting the registrant has used to prepare the financial statements included in this filing:

If “Other” has been checked in response to previous question, indicate by check mark which financial statement item the registrant has elected to follow. Item 17 ☐ Item 18 ☐

If this is an annual report, indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☐

TABLE OF CONTENTS

Page

INTRODUCTION AND USE OF CERTAIN TERMS

In this Form 20-F, the terms “we”, “our”, “us”, the “Company”, “Corporation” and “First Phosphate” refer, unless the context requires otherwise, to First Phosphate Corp, and its predecessor corporations. All capitalized terms not otherwise defined have the meanings ascribed to them in the “Commonly Used Defined Terms” section.

METRIC EQUIVALENTS

In this Form 20-F, metric units are used with respect to the Corporation’s various mineral properties and operations. Conversion rates from imperial measures to metric units and from metric units to imperial measures are provided in the table set out below:

CURRENCY

All amounts are expressed in Canadian dollars unless otherwise stated.

COMMONLY USED DEFINED TERMS

Unless otherwise indicated or the context requires otherwise, references in this Form 20-F to:

“2025 Warrant” each 2025 Warrant is exercisable for one Common Share at a price of $0.50 until December 31, 2025, subject to the Acceleration Right;

“Acceleration Right” means the right of the Company to elect to accelerate the expiry date of the 2025 Warrants in the event that the volume weighted average trading price of the Common Shares on any recognized stock exchange equals or exceeds $0.80 for any five (5) consecutive trading days, in which case if the Company elects to accelerate the 2025 Warrants they will expire thirty (30) days after the date that the Company issues a press release triggering the Acceleration Right;

“Accelerated Expiry” means the right of the Company to elect to accelerate the expiry date of the April 2023 Warrants in the event that the volume weighted average trading price of the Company’s Common Shares on any recognized stock exchange equals or exceeds $2.00 for any five (5) consecutive trading days, in which case if the Company elects to accelerate the April 2023 Warrants they will expire thirty (30) days after the date that the Company issues a press release triggering the Accelerated Expiry.

“Additional Mineral Claims Agreement” means the agreement governing the Company’s acquisition of 13 additional mineral claims in the Bégin-Lamarche claim block representing approximately 612 ha. in the region of Saguenay-Lac-St-Jean, Quebec, for the consideration of $22,825 to be satisfied through the issuance of 27,173 Common Shares of at a price of $0.84 per Share.

“ACTO” means the cease trade order against the Company by the ASC on October 16, 2013;

“April 2023 FT Units” flow-through units issued by the Company as part of the April 2023 Private Placement, each April 2023 FT Unit consists of (i) one flow-through Common Share; and (ii) one half of one April 2023 Warrant;

“April 2023 HD Units” hard dollar units issued by the Company as part of the April 2023 Private Placement, each HD Unit consists of (i) one Common Share; and (ii) one half of one April 2023 Warrant;

“April 2023 Private Placement” means the private placement financing that the Company completed on April 25, 2023 for aggregate gross proceeds of $2,339,152;

“April 2023 Warrant” each whole April 2023 Warrant is exercisable for one Common Share at a price of $1.25 until 36 months from the date such April 2023 Warrant was issued, subject to the Accelerated Expiry;

“ASC” means Alberta Securities Commission;

“Audit Committee” has the meaning ascribed to it in National Instrument 52-110 – Audit Committees;

“August 2022 Private Placement” means the private placement financing that the Company completed on August 23, 2022 for aggregate gross proceeds of $2,157,250;

“BCBCA” means Business Corporations Act (British Columbia);

“BCCTO” means the cease trade order issued by the British Columbia Securities Commission against the Company on July 17, 2013;

“BCSC” means British Columbia Securities Commission;

“Begin-Lamarche Agreement” has the meaning ascribed to it in “Other Property Interests – Begin-Lamarche Area”;

“Bluesky Agreement” has the meaning ascribed to it in “Non-Material Properties – Bluesky”;

“Board of Directors” means the Company’s board of directors;

“CAM” means cathode active material;

“Common Shares” means the common shares in the capital of the Company;

“Company” means First Phosphate Corp., a company formed under the laws of the province of British Columbia;

“Compensation Committee” means the Compensation Committee of the Company formed by the board of directors;

“Compensation Warrants” means the warrants to purchase Common Shares issued to certain finders in connection with the August 2022 Private Placement. The Compensation Warrants are exercisable at a price of $0.25 per Common Share, for a period of 24 months from the closing of the August 2022 Private Placement;

“Concurrent Financing” means the financing that the Company completed on December 1, 2022, December 22, 2022, December 30, 2022, January 17, 2023 and February 15, 2023 for aggregate gross proceeds of $4,454,651;

“Consolidation” has the meaning ascribed to it in the Section “General Development of the Business”;

“CSE” means the Canadian Securities Exchange;

“Dallaire Option” has the meaning ascribed to it in “General Development of the Business – Description of the Business”;

“Escrow Agent” Computershare Investor Services Inc.;

“Escrow Agreement” means the agreement between certain Shareholders of the Company and the Escrow Agent dated February 15, 2023;

“Escrowed Person” means each person other than the Company and the Escrow Agent who is a party to the Escrow Agreement;

“Escrowed Securities” means the securities of the Company subject to the Escrow Agreement;

“ESG” means environmental, social, and governance;

“Financial Statements” means the financial statements of the Company prepared using IFRS and available on SEDAR+;

“First Phosphate” means the Company;

“Finder Warrants” means non-transferrable warrants, each exercisable for one Common Share at a price of $0.50 until December 31, 2025, subject to the Acceleration Right;

“Form 20-F” means this registration statement filed on Form 20-F;

“FSE means the Frankfurt Stock Exchange; 

“FT Units” flow-through units issued by the Company as part of the Concurrent Financing, each FT Unit consists of (i) one flow-through Common Share; and (ii) one half of one 2025 Warrant;

“Glen Eagle” means Glen Eagle Resources Inc., an arm’s length TSX Venture Exchange listed company that the Company entered into the Mineral Option Agreement with;

“Grant Date” means the date that the Options were granted to each Option holder;

“HD Units” hard dollar units issued by the Company as part of the Concurrent Financing, each HD Unit consists of (i) one Common Share; and (ii) one half of one 2025 Warrant;

“IFRS” means International Financial Reporting Standards.

“June 2022 Private Placement” Means the financing the Company completed on June 28, 2022 where the Company issued 19,300,000 Common Shares at a price of $0.02 per share for aggregate gross proceeds of $386,000;

“LFMP” means lithium iron manganese phosphate; 

“LFP” means lithium iron phosphate;

“LFP Battery” means lithium iron phosphate battery;

“LFP CAM” means lithium iron phosphate-based cathode active material;

“Listing” means the listing of the Common Shares of the Company for trading on the CSE;

“Listing Date” means the date of the bulletin issued by the CSE evidencing final CSE acceptance of the application for Listing;

“LMFP” means lithium manganese iron phosphate;

“Loan Agreement” means the loan agreement between Loomac Management Ltd. and the Company on January 8, 2021 pursuant to which the Company borrowed $10,000 to be used to pay expenses for the revival of the Company;

“Loan” means the funds advanced to the Company under the Loan Agreement;

“Loomac” means Loomac Management Ltd.;

“MD&A” means management’s discussion and analysis;

“Mineral Option Agreement” means the agreement with the optionor entered into on June 17, 2022 with respect to the payment of a 1% net-smelter royalty;

“Mineral Reserves” has the meaning ascribed to it in the Technical Report;

“Mineral Resources” has the meaning ascribed to it in the Technical Report;

“NEO” means Named Executive Officer as defined in NI 51-102;

“NI 43-101” means National Instrument 43-101, Standards of Disclosure for Mineral Projects, of the Canadian Securities Administrators;

“NI 51-102” means National Instrument 51-102 – Continuous Disclosure Obligations;

“NI 52-110” means National Instrument 52-110 – Audit Committees;

“NP 46-201” means National Policy 46-201 – Escrow for Initial Public Offerings;

“NSR” means net-smelter royalty;

“Omnibus Plan” means the omnibus equity incentive plan adopted by the Company’s shareholders on July 26, 2023;

“Option” means an option to purchase a Common Share; 

“Partial Revocation Order” means the partial revocation order issued by the BCSC on December 16, 2020;

“PEA” means Preliminary Economic Assessment;

“Person” means any individual, firm, partnership, limited partnership, limited liability company or partnership, association, trust, trustee, executor, administrator, legal or personal representative, government, governmental body, entity or authority, group, body corporate, corporation, unincorporated organization or association, syndicate, joint venture or any other entity, whether or not having legal personality, and any of the foregoing in any derivative, representative or fiduciary capacity and pronouns have a similar extended meaning;

“PPA” means purified phosphoric acid;

“Pre-Consolidation Shares” means the common shares in the capital of the Company following the Consolidation;

“Property” means the Lac à l’Orignal Phosphate Project;

“Qualified Person” means Antoine Yassa, P. Geo, registered geologist of 3602 Rang des Cavaliers, Rouyn-Noranda, J0Z 1Y2;

“Registration Statement” means this registration statement filed on Form 20-F;

“RSU” means restricted share units; 

“RSU Plan” means the restricted share unit plan ratified and approved by Shareholders on August 25, 2022;

“Shareholder” means a holder of common shares in the capital of the Company;

“Stock Option Plan” means the Company’s stock option plan dated August 25, 2022;

“TSXV” means the TSX Venture Exchange;

“Variation Order” means the variation order issued by the ASC on December 16, 2020; and

“Warrant” means a warrant to purchase a common share of the Company.

INTRODUCTION

First Phosphate Corp. was incorporated under the Business Corporations Act (British Columbia) on September 18, 2006 under the name of Etna Resources Inc. On January 20, 2010, Etna Resources Inc. changed its name to Pan American Lithium Corp. On September 23, 2011, Pan American Lithium Corp. authorized a class of preferred shares without par value and allowed for the issuance of an unlimited number of preferred shares without value. On November 26, 2012, Pan American Lithium Corp. changed its name to First Potash Corp. On June 29, 2022, First Potash Corp. changed its name to First Phosphate Corp.

We are a mineral development company fully dedicated to extracting and purifying phosphate for the production of cathode active material for the LFP Battery industry. We are committed to producing at high purity level, at full ESG standard and with low anticipated carbon footprint. We plan to vertically integrate from mine source directly into the supply chains of major North American LFP battery producers that require battery grade LFP cathode active material emanating from a consistent and secure supply source. We hold over 1,500 sq. km of royalty-free district-scale land claims in the Saguenay-Lac-St-Jean Region of Quebec, Canada that it is actively developing. Our properties consist of rare anorthosite igneous phosphate rock that generally yields high purity phosphate material devoid of high concentrations of harmful elements.

The Common Shares are listed for trading on the CSE under the trading symbol “PHOS” and on the FSE under the trading symbol “KD0.”

First Phosphate is a “foreign private issuer” as defined in Rule 3b-4 under the Securities Exchange Act of 1934, as amended (the “Exchange Act”). As a result, we are eligible to file this registration statement pursuant to Section 12(g) of the Securities Exchange Act of 1934 Act on Form 20-F and to file interim reports on Form 6-K.

Our financial statements appearing in this registration statement are prepared in Canadian dollars and in accordance with IFRS as issued by the International Accounting Standards Board (“IASB”), as described in Note 3 to the financial statements as at February 28, 2023, 2022, and 2021 and for the years then ended. The unaudited condensed interim financial statements as at August 31, 2023 and 2022 and for the six months then ended have been prepared in accordance with International Accounting Standard (“IAS”) 34, Interim Financial Reporting, as issued by the IASB. All references in this registration statement to “dollars” or “$” are to Canadian dollars.

The following table sets forth the rate of exchange for the USD expressed in CAD in effect on the last business day of the year indicated based on the posted Bank of Canada exchange rates.

The daily average exchange rate on December 14, 2023, as reported by the Bank of Canada for the conversion of USD into CDN was USD$1.00 equals $1.3419.

Statements made in this registration statement concerning the contents of any contract, agreement or other document are summaries of such contracts, agreements or documents and are not complete descriptions of all of their terms. If we file any of these documents as an exhibit to this registration statement, you may read the document itself for a complete description of its terms.

Implications of Being an “Emerging Growth Company” and a “Foreign Private Issuer”

We are an “emerging growth company” as defined in the Jumpstart Our Business Startups Act of 2012 (the “JOBS Act”). As such, we are eligible to take advantage of exemptions from certain reporting requirements that are applicable to other publicly traded entities that are not emerging growth companies. These exemptions include:

We may take advantage of these exemptions for up to five years or such earlier time that we are no longer an emerging growth company. We would cease to be an emerging growth company if we have more than $1.07 billion in annual revenues as of the end of a fiscal year, if we are deemed to be a large-accelerated filer under the rules of the SEC or if we issue more than $1.0 billion of non-convertible debt over a three-year period.

We report under the Exchange Act as a non-U.S. company with foreign private issuer status. Even after we no longer qualify as an emerging growth company, as long as we qualify as a foreign private issuer under the Exchange Act we will be exempt from certain provisions of the Exchange Act that are applicable to U.S. domestic public companies, including:

Both foreign private issuers and emerging growth companies are also exempt from certain more stringent executive compensation disclosure rules. Thus, even if we no longer qualify as an emerging growth company, but remain a foreign private issuer, we will continue to be exempt from the more stringent compensation disclosures required of companies that are neither an emerging growth company nor a foreign private issuer.

CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS

Information set forth in this Form 20-F may involve forward-looking statements under applicable securities laws. Forward-looking statements are statements that relate to future, not past, events. In this context, forward-looking statements often address expected future business and financial performance, and often contain words such as “anticipate”, “believe”, “plan”, “estimate”, “expect”, and “intend”, statements that an action or event “may”, “might”, “could”, “should”, or “will” be taken or occur, or other similar expressions. All statements, other than statements of historical fact, included herein are forward-looking statements. By their nature, forward-looking statements involve known and unknown risks, uncertainties and other factors which may cause our actual results, performance or achievements, or other future events, to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements. Such factors include, among others, the following risks: the need for additional financing; reliance on key personnel; the potential for conflicts of interest among certain officers, directors, or promoters with certain other projects; the absence of dividends; competition; dilution; the volatility of our common share price and volume and the additional risks identified in the “Risk Factors” section of this Form 20-F or other reports and filings with applicable securities regulations. The Company cautions that such list of factors is not exhaustive, and that, when relying on forward-looking information to make decisions with respect to the Company, readers should carefully consider these factors, as well as other uncertainties and potential events, and the inherent uncertainty of forward-looking information. Forward-looking statements are made based on management’s beliefs, estimates and opinions on the date that statements are made, and the Company undertakes no obligation to update forward-looking statements if these beliefs, estimates and opinions or other circumstances should change, except as required by applicable securities laws of the United States and Canada. Investors are cautioned against attributing undue certainty to forward-looking statements.

Some of the important risks and uncertainties that could affect forward-looking statements are described further under the heading “Item 3.D. Risk Factors”. If one or more of these risks or uncertainties materializes, or if underlying assumptions prove incorrect, our actual results may vary materially from those expected, estimated or projected. Forward-looking statements in this document are not a prediction of future events or circumstances, and those future events or circumstances may not occur. Given these uncertainties, users of the information included in this Form 20-F, including investors and prospective investors are cautioned not to place undue reliance on such forward-looking statements.

PART I 

The following are the names, business addresses and functions of our directors and executive officers:

Chief Executive Officer and Director – John Passalacqua, Int’l MBA, Age 51, is an international business strategist with over 35 years of extensive technology and capital markets experience. In 1998, John gained the title of a top 50 international business strategist on the early internet. He is involved in private and public market planning for companies in nascent, visionary industries. John has lived in Quebec and is fluently bilingual in English and French. John is financially literate within the meaning of NI 52-110. Mr. Passalacqua expects to devote approximately 90% of his time to the affairs of the Company.

Chief Financial Officer, Chief Administrative Officer, Corporate Secretary, and Director – Bennett Kurtz, Age 63, is principal of Kurtz Financial Group. He has experience in financing public companies and taking private companies public. Bennett has multi-faceted business experience in finance, management, sales, marketing and administrative functions including business analysis, public business unit segmentation, internal and external analytics. Mr. Kurtz expects to devote approximately 50% of his time to the affairs of the Company.

Chairman and Independent Director – Laurence W. Zeifman, CPA, CA, Age 62, is an audit partner of Zeifmans LLP, a mid-sized Toronto public accounting firm. Larry has four decades of experience in public accounting and serves as chair of Nexia Canada, the Canadian division of the eighth largest international accounting network. He is also a former Director of the Ottawa Senators Hockey Club and is a former Alternate Governor of the National Hockey League. Larry is financially literate within the meaning of NI 52-110. Mr. Zeifman expects to devote approximately 5% of his time to the affairs of the Company.

Independent Director – Marc Branson, Age 47, is president of CapWest Investment Corp. Throughout his career, Marc has founded and grown companies in multiple sectors including mining, industrials, manufacturing, marketing, and consumer electronics. Marc currently serves on a number of public and private companies and is financially literate within the meaning of NI 52-110. He provides management and strategic guidance. Mr. Branson expects to devote approximately 10% of his time to the affairs of the Company. 

Chief Geologist – Gilles Laverdiere, Age 60, is a geologist with more than 40 years of experience in mining exploration. Gilles has planned and supervised drilling projects in Quebec and elsewhere. He was President and CEO of HMZ Metals Inc. Gilles has served as a senior executive and board member of many public mining companies and is a member of the Ordre des Géologues du Québec.

Vice-President Business Development – Jérôme Cliché, Age 60, is the Vice President of Business Development of the Company. Mr. Cliché is seasoned in the areas of corporate finance, strategic investment and corporate development. Mr. Cliché has been co-founder of Renmark Financial Communication, a Montreal based company offering a wide range of integrated services to small, medium, and large cap public companies trading on all major North American stock exchanges.

None of the directors were elected under any arrangement or understanding between the director and any other person or company.

Our Canadian legal counsel is Garfinkle Biderman LLP Barristers & Solicitors, 1 Adelaide Street East (South-East corner of Young & Adelaide), Suite 801, Toronto, ON, Canada M5C 2V9

The Company’s independent registered auditors are Davidson & Company LLP, with a business address at 609 Granville St #1200, Vancouver, BC V7Y 1H4. Davidson & Company LLP, are members of the Chartered Professional Accountants of British Columbia and are registered with both the Canadian Public Accountability Board and the U.S. Public Company Accounting Oversight Board. Davidson & Company LLP, were appointed as the Company’s auditors effective December 21, 2020. 

Not applicable.

The table below presents our capitalization and indebtedness as of November 30, 2023 in accordance with IFRS. You should read this table in conjunction with Item 5, “Operating and Financial Review and Prospects”, Item 18 “Financial Statements”, related notes and other financial information contained elsewhere in this registration statement.

Not applicable.

An investment in our securities involves a high degree of risk and the securities must be considered highly speculative. You should consider carefully all of the risks described below, together with the other information contained in this Form 20-F, before making a decision to invest in our securities. If any of the following events occur, our business, financial condition and operating results may be materially adversely affected. In that event, the trading price of our securities could decline, and you could lose all or part of your investment.

The risk factors outlined below are not a definitive list of all risk factors associated with an investment in the securities offered hereunder. Additional risks and uncertainties not presently known to us, or which we currently deem not to be material, may also have a material adverse effect. Prospective investors and shareholders should consider carefully all of the information set out in this Form 20-F and the risks attaching to an investment in us before making any investment decision and consult with their own professional advisors where necessary.

The risks and uncertainties described in this Form 20-F are those the Company currently believes to be material, but they are not the only ones it faces. If any of the following risks, or any other risks and uncertainties that the Company has not yet identified or that it currently considers not to be material, actually occur or become material risks, the Company’s business, financial condition and operating results may be materially adversely affected. In that event, the trading price of our securities could be materially and adversely affected.

Risks Associated with Our Operations and Mineral Exploration

We have a limited operating history. 

Following the issuance of the partial revocation orders to the BCCTO and ACTO on December 16, 2020, the Company began operations again under new management. The Company has a limited operating history and no operating revenues. There is no assurance that the Property or any other property or business that the Company may acquire or undertake will generate earnings, operate profitably or provide a return on investment in the future.

The likelihood of our success must be considered in light of the problems, expenses, difficulties, complication, and delays frequently encountered in connection with the establishment of any business. We will have limited financial resources and there is no assurance that additional funding will be available to us for further operations or to fulfill our obligations under applicable agreements. There is no assurance that we will be able to generate revenues, operate profitably, or provide a return on investment, or that we will successfully implement our plans.

The loss of key personnel could adversely affect our operations.

Our senior officers are critical to our success. In the event of the departure of a senior officer, there can be no assurance that we would be successful in attracting and retaining qualified successors. Recruiting qualified personnel as we grow is critical to our success. The number of persons skilled in the acquisition, exploration, and development of mining properties is limited, and competition for such persons is intense. As our business activity grows, we will require additional key financial, administrative, engineering, geological and other personnel. If we are not successful in attracting and training qualified personnel, the efficiency of our operations could be affected, which could have an adverse impact on future cash flows, earnings, results of operations and our financial condition. We are particularly at risk at this stage of our development as we rely on a small management team, the loss of any member of which could cause severe adverse consequences.

The natural resource industry is highly competitive, and our failure to successfully compete could have a material adverse effect on our business, financial condition, or results of operations.

We will actively compete for resource acquisitions, exploration leases, licences, concessions, and skilled industry personnel with a substantial number of other mining companies, many of which have significantly greater financial resources than us. Our competitors will include major integrated mining companies and numerous other independent mining companies and individual producers and operators, some of which may have greater liquidity, greater access to credit and other financial resources, newer or more efficient equipment, lower cost structures, more effective risk management policies and procedures and/or greater ability than we have to withstand losses. Our competitors may be able to respond more quickly to new laws or regulations or emerging technologies or devote greater resources to the expansion of their operations than we can. In addition, current and potential competitors may make strategic acquisitions or establish cooperative relationships among themselves or with third parties. Competition could adversely affect our ability to acquire suitable new properties in the future. Competition could also affect our ability to raise financing to fund the exploration and development of our properties or to hire qualified personnel. We may not be able to compete successfully against current and future competitors, and any failure to do so could have a material adverse effect on our business, financial condition, or results of operations.

We operate in the resource industry, which is highly speculative, and has certain inherent exploration risks which could have a negative effect on our operations.

Our mineral properties are in early exploration stages and are without a known body of commercially exploitable resources. Exploration for mineral resources involves a high degree of risk and few properties that are explored are ultimately developed into producing mines. The risks and uncertainties inherent in exploration activities include but are not limited to: general economic, market and business conditions, the regulatory process and actions, failure to obtain necessary permits and approvals, technical issues, new legislation, competitive and general economic factors and conditions, the uncertainties resulting from potential delays or changes in plans, the occurrence of unexpected events and management’s capacity to execute and implement its future plans. The discovery of mineral deposits is dependent upon several factors, not the least of which are the technical skills of the exploration personnel involved and the capital required for the programs. The cost of conducting exploration programs may be substantial and the likelihood of success is difficult to assess. There is no assurance that our mineral exploration activities will result in any discoveries of new bodies of commercial ore. There is also no assurance that even if commercial quantities of ore are discovered that a new ore body will be developed and brought into commercial production. The commercial viability of a mineral deposit once discovered is also dependent upon several factors, most of which are beyond our control and may result in the Company not receiving adequate return on investment capital.

We may be unable to obtain the substantial funds required to continue our operations.

Substantial expenditures are required to establish mineral reserves through drilling and the estimation of mineral reserves or mineral resources in accordance with the Canadian Institute of Mining, Metallurgy and Petroleum Definition Standards on Mineral Reserves and Mineral Resources. Although significant benefits may be derived from the discovery of a major mineralized deposit, we may not discover minerals in sufficient quantities or grades to justify a commercial mining operation and the funds required for development may not be obtained on a timely basis or may not be obtainable on terms acceptable to us. Estimates of mineral reserves and mineral resources can also be affected by environmental factors, unforeseen technical difficulties and unusual or unexpected geological formations. In addition, the grades of minerals ultimately mined may differ from those indicated by drilling results. Material changes in mineral reserve or mineral resource estimates, grades, stripping ratios or recovery rates may affect the economic viability of any project.

We may fail to obtain required permits and licences which could adversely impact our operations and profitability.

In the ordinary course of business, we are required to obtain new governmental permits as well as renew permits for exploration and development activities and any ultimate development, construction, and commencement of new mining operations. Obtaining or renewing necessary permits can be a complex and time-consuming process, which at times may involve several political jurisdictions and different government agencies that may not have the necessary expertise, resources or political disposition needed for efficient and timely processing and may require public hearings and costly undertakings on our part. The duration and success of our efforts to obtain and renew permits are contingent upon many variables not within our control, including the interpretation of applicable requirements implemented by permitting authorities and timeframes for agency decisions. We may not be able to obtain or renew permits that are necessary to our operations, or the cost to obtain or renew permits may exceed what we believe we can recover from our mineral properties once in production. Any unexpected delays or costs associated with the permitting process could slow exploration and/or development or impede the eventual operation of a mine and could adversely impact our operations and profitability.

We may be unable to successfully identify suitable acquisition candidates and partners, negotiate acceptable terms or integrate their operations with ours.

We will evaluate from time-to-time opportunities to acquire or enter into joint ventures in respect of mining assets and businesses. These acquisitions and joint ventures may be significant in size, may involve granting rights to third parties, may change the scale of our business and may expose us to new geographic, political, operating, financial and geological risks. Our success in our acquisition and joint venture activities will depend on our ability to successfully negotiate arrangements, identify suitable acquisition and joint venture candidates and partners, acquire or enter into a joint venture with them on acceptable terms and integrate their operations successfully with ours.

We may be unable to protect our information systems or prevent cyber-attacks and security breaches.

Our operations depend on information technology (“IT”) systems. These IT systems could be subject to network disruptions caused by a variety of sources, including computer viruses, security breaches and cyber-attacks, as well as disruptions resulting from incidents such as cable cuts, damage to physical plants, natural disasters, terrorism, fire, power loss, vandalism, and theft. Our operations also depend on the timely maintenance, upgrade and replacement of networks, equipment, IT systems and software, as well as pre-emptive expenses to mitigate the risks of failures. Any of these and other events could result in IT system failures, delays and/or increase in capital expenses. The failure of IT systems or a component of information systems could, depending on the nature of any such failure, adversely impact our reputation and results of operations.

Although to date we have not experienced any material losses relating to cyber-attacks or other information security breaches, there can be no assurance that we will not incur such losses in the future. Our risk and exposure to these matters cannot be fully mitigated because of, among other things, the evolving nature of these threats. As a result, cyber security and the continued development and enhancement of controls, processes and practices designed to protect systems, computers, software, data and networks from attack, damage or unauthorized access remain a priority. As cyber threats continue to evolve, we may be required to expend additional resources to continue to modify or enhance protective measures or to investigate and remediate any security vulnerabilities.

Our inability to access adequate infrastructure for our exploration, development and processing activities could negatively affect our business, financial condition, results of operations, cash flows or prospects.

Exploration, development and processing activities depend on adequate infrastructure. Reliable roads, bridges, power sources and water supply are important elements of infrastructure, which affect access, capital and operating costs. The lack of availability on acceptable terms or the delay in the availability of any one or more of these items could prevent or delay the exploration or development of our mineral properties. If adequate infrastructure is not available in a timely manner, there can be no assurance that the exploration or development of our mineral properties will be commenced or completed on a timely basis, if at all. Furthermore, unusual or infrequent weather phenomena, civil unrest, sabotage, government or other interference in the maintenance or provision of necessary infrastructure could adversely affect our operations. Failure to adequately meet these infrastructure requirements or changes in the cost of such requirements could affect our ability to carry out exploration and future development operations and could have a material adverse effect on our business, financial condition, results of operations, cash flows or prospects.

We are subject to political regulatory risks which may adversely affect our ability to continue to explore, develop and operate our properties.

Any changes in government policy may result in changes to laws affecting ownership of assets, exploration policies, monetary policies, taxation, rates of exchange, environmental regulations, labour relations and return of capital. This may affect both our ability to undertake exploration and development activities in respect of present and future properties in the manner currently contemplated, as well as our ability to continue to explore, develop and operate those properties in which we have an interest or in respect of which we have obtained exploration and development rights to date. The possibility that future governments may adopt substantially different policies, which might extend to expropriation of assets, cannot be ruled out.

We are subject to substantial environmental requirements which could cause a restriction or suspension of our operations.

Environmental and other regulatory requirements will affect our future operations, including exploration and development activities and commencement of production on our mining properties. Such projects will require permits from various federal and local governmental authorities and such operations are and will be governed by laws and regulations governing exploration, production, exports, taxes, labour standards, occupational health, waste disposal, toxic substances, land use, environmental protection, mine safety and other matters. Companies engaged in the development and operation of mines and related facilities often experience increased costs, and delays in production and other schedules as a result of the need to comply with applicable laws, regulations and permits.

Additional permits and studies, which may require that environmental impact studies be conducted before permits can be obtained, may be necessary prior to operation of our mining properties and there can be no assurance that we will be able to obtain or maintain all necessary permits that may be required to commence construction, development or operation of ore extraction facilities at our mining properties on terms which enable operations to be conducted at economically justifiable costs.

Our failure to comply with applicable laws, regulations, and permitting requirements may result in enforcement actions, including orders issued by regulatory or judicial authorities causing operations to cease or be curtailed, and may include corrective measures requiring capital expenditures, installation of additional equipment, or remedial actions. We may be required to compensate those suffering loss or damage by reason of the mining exploration activities and may have civil or criminal fines or penalties imposed on us for violations of applicable laws or regulations and environmental laws.

Amendments to current laws, regulations, and permits governing operations and activities of mining companies, or more stringent implementation thereof, could have a material adverse impact on us and cause increases in capital expenditures or exploration costs or require abandonment or delays in the exploration or future development of new mining properties.

Our mineralization estimates may be inaccurate, which could negatively impact our projected revenues and cause us to fail to obtain the necessary capital to operate.

Unless otherwise indicated, mineralization figures presented by the Company in filings with securities regulatory authorities, press releases and other public statements that may be made from time to time, are based upon estimates made by our personnel and independent geologists. These estimates are inherently imprecise, as they depend upon geological interpretation and statistical inferences drawn from drilling and sampling analysis, which may prove to be unreliable. As a result, there can be no assurance that mineral resource or other mineralization figures or estimates of costs (including initial capital costs and initial capital intensity) and expenses will be accurate, nor that the resource mineralization could be mined or processed profitably.

We are dependent on a single material mineral property, and our failure to explore and develop this property would adversely affect our future revenue and profits.

We currently have only one material project, the Lac à l’Orignal Property, and, in the absence of additional mineral projects, we are solely dependent upon its exploration and development for future revenue and profits. Should additional exploration and development of the Lac à l’Orignal Property not be possible or practicable for political, engineering, technical or economic reasons, then our business and financial position will be significantly and adversely affected.

We have no guarantee of clear title to our mineral properties, and we could lose title and ownership of our properties, which would have a negative effect on our operations and valuation.

Although we have or will receive title opinions for any material properties in which we have an interest, there is no guarantee that title to such properties will not be challenged or impugned. Our properties may be subject to prior unregistered agreements or transfers or indigenous land claims and title may be affected by unidentified or unknown defects. Title insurance is generally not available for mineral properties and our ability to ensure that we have obtained secure claims to individual mineral properties or mining concessions may be constrained. A successful challenge to our title to a property or to the precise area and location of a property could cause delays or stoppages to our exploration activities or loss of our rights to explore, develop and extract any ore on that property without reimbursement to us. Any such delays, stoppages or loss of title would likely have a material adverse effect on our business, financial condition, and results of operations.

We may be subject to a variety of civil or other legal proceedings, which may adversely affect our business, operating results or financial condition.

The Company and/or our directors and officers may be subject to a variety of civil or other legal proceedings, with or without merit. From time to time in the ordinary course of our business, we may become involved in various legal proceedings, including commercial, employment and other litigation and claims, as well as governmental and other regulatory investigations and proceedings. Such matters can be time-consuming, divert management’s attention and resources and cause us to incur significant expenses. Furthermore, because litigation is inherently unpredictable, the results of any such actions may have a material adverse effect on our business, operating results or financial condition.

Our exploration activities require significant amounts of capital that may not be recovered.

Mineral exploration activities are subject to many risks, including the risk that no commercially productive or extractable resources will be encountered. There can be no assurance that our activities will ultimately lead to an economically feasible project or that we will recover all or any portion of our investment. Mineral exploration often involves unprofitable efforts, including drilling operations that ultimately do not further our exploration efforts. The cost of minerals exploration is often uncertain, and cost overruns are common. Our drilling and exploration operations may be curtailed, delayed or cancelled as a result of numerous factors, many of which are beyond our control, including title problems, weather conditions, protests, compliance with governmental requirements, including permitting issues, and shortages or delays in the delivery of equipment and services.

The Company may expand into other geographic areas, which could increase the Company’s operational, regulatory and other risks.

While currently all of the Company’s exploration activities are in Canada, the Company may in the future expand into other geographic areas, which could increase the Company’s operational, regulatory, compliance, reputational and foreign exchange rate risks. The failure of the Company’s operating infrastructure to support such expansion could result in operational failures and regulatory fines or sanctions. Future international expansion could require the Company to incur a number of up-front expenses, including those associated with obtaining regulatory approvals, as well as additional ongoing expenses, including those associated with infrastructure, staff and regulatory compliance. The Company may not be able to successfully identify suitable acquisition and expansion opportunities, or integrate such operations successfully with the Company’s existing operations.

Financing Risks

We may be unable to obtain the additional funding we need to continue our operations.

We will be dependent on third-party financing, whether through debt, equity or other means. There is no assurance that we will be successful in obtaining required financing in the future or that such financing will be available on terms acceptable to us. Volatile resource markets, a claim against the Company, a significant event disrupting our business or other factors may make it difficult or impossible to obtain financing through debt, equity or other means on favorable terms, or at all. In addition, any future financing may also be dilutive to our existing shareholders.

We may be unable to continue as a going concern.

Our audited financial statements have been prepared on a going concern basis under which an entity is considered to be able to realize its assets and satisfy its liabilities in the ordinary course of business. The assessment of our ability to continue as a going concern and to raise sufficient funds to pay for our ongoing operating expenditures and meet our liabilities for the ensuing year involves significant judgment based on historical experience and other factors, including expectation of future events that are believed to be reasonable under the circumstances. Our future operations are dependent upon the identification and successful completion of equity or debt financings and the achievement of profitable operations at an indeterminate time in the future. There can be no assurances that we will be successful in completing equity or debt financings or in achieving profitability.

Risks Relating to our Common Shares

The market for our Common Shares is subject to volume and price volatility which could negatively affect a shareholder’s ability to buy or sell our Common Shares.

In recent years, the securities markets in Canada and the United States, and the CSE in particular, have experienced a high level of price and volume volatility, and the market prices of securities of many companies have experienced wide fluctuations in price that have not necessarily been related to the operating performance, underlying asset values, or prospects of such companies. There can be no assurance that continual fluctuations in price will not occur. Any quoted market for the Common Shares will be subject to market trends and conditions generally, notwithstanding any potential success of the Company in creating revenues, cash flows, or earnings.

The price of our Common Shares may be adversely affected by declines in the prices of certain minerals.

The price of the Common Shares, our financial results, exploration, and development activities may in the future be adversely affected by declines in the prices of certain minerals. Prices for minerals fluctuate widely and are affected by numerous factors beyond our control, such as the sale or purchase of commodities by various central banks and financial institutions, expectations of inflation or deflation, currency exchange fluctuations, interest rates, global or regional consumptive patterns, international supply and demand, speculative activities and increased production due to new mine developments, improved mining and production methods and international economic and political trends. Our future revenues, if any, are expected to be in large part derived from mining and sale of precious and base metals or interests in properties related thereto. The effect of these factors on the price of precious and base metals, and therefore the economic viability of any of our exploration projects, cannot accurately be predicted.

We do not intend to pay dividends on our Common Shares and, consequently, your ability to achieve a return on your investment will depend on appreciation in the price of our Common Shares.

Because we have no near-term plans to pay cash dividends on our Common Shares, investors must look solely to share appreciation for a return on their investment. We anticipate retaining all available funds and any future earnings to finance our further growth and there is no expectation that we will declare or pay any cash dividends on our Common Shares in the near term. Accordingly, investors will only see a return on their investment if the value of our Common Shares appreciates.

Further equity financings may lead to the dilution of our Common Shares.

In order to finance future operations, we may raise funds through the issuance of Common Shares or the issuance of debt instruments or other securities convertible into Common Shares. We cannot predict the size of future issuances of Common Shares or the size and terms of future issuances of debt instruments or other securities convertible into Common Shares or the effect, if any, that future issuances and sales of our securities will have on the market price of our Common Shares. Any transaction involving the issuance of previously authorized but unissued shares, or securities convertible into common shares, would result in dilution, possibly substantial, to present and prospective security holders. Demand for equity securities in the mining industry has been weak; therefore, equity financing may not be available on attractive terms and, if available, will likely result in significant dilution to existing shareholders.

We are subject to risks associated with evolving corporate governance and public disclosure regulations.

The Company is subject to changing rules and regulations promulgated by the United States and Canadian governmental and self-regulated organizations, including the SEC, the CSA, any exchange or marketplace on which the Company’s securities are listed or trade, and the Financial Accounting Standards Board. These rules and regulations continue to evolve in scope and complexity making compliance more difficult and uncertain. The Company’s efforts to comply with these and other new and existing rules and regulations have resulted in, and are likely to continue to result in, increased general and administrative expenses and a diversion of management time and attention from revenue-generating activities to compliance activities.

We are an emerging growth company, as defined in the Securities Act of 1933 (the “Securities Act”), and we cannot be certain if the reduced disclosure requirements applicable to emerging growth companies will make our Common Shares less attractive to investors because we may rely on these reduced disclosure requirements.

We are an emerging growth company, as defined in Section 2(a) of the Securities Act, as modified by the JOBS Act, and we could continue to be an emerging growth company for up to five years following the completion of our initial public offering.

For as long as we continue to be an emerging growth company, we may also take advantage of certain exemptions from various reporting requirements that are applicable to other public companies that are not emerging growth companies, including presenting only limited selected financial data and not being required to comply with the auditor attestation requirements of Section 404(b) of the Sarbanes-Oxley Act of 2002. As a result, our shareholders may not have access to certain information that they may deem important. We cannot predict if investors will find our Common Shares less attractive because we may rely on these exemptions. If some investors find our Common Shares less attractive as a result, there may be a less active trading market for our Common Shares and our share price may be more volatile.

We are a foreign private issuer and, as a result, we are not subject to U.S. proxy rules and are subject to Exchange Act reporting obligations that, to some extent, are more lenient and less frequent than those of a U.S. domestic public company.

We report under the Exchange Act as a non-U.S. company with foreign private issuer status. Because we qualify as a foreign private issuer under the Exchange Act, we are exempt from certain provisions of the Exchange Act that are applicable to U.S. domestic public companies, including (1) the sections of the Exchange Act regulating the solicitation of proxies, consents or authorizations in respect of a security registered under the Exchange Act, (2) the sections of the Exchange Act requiring insiders to file public reports of their share ownership and trading activities and liability for insiders who profit from trades made in a short period of time and (3) the rules under the Exchange Act requiring the filing with the SEC of quarterly reports on Form 10-Q containing unaudited financial and other specified information. In addition, foreign private issuers are not required to file their annual report on Form 20-F as promptly as U.S. domestic issuers. In addition, we are permitted to disclose limited compensation information for our executive officers on an individual basis. Further, we are not required to comply with Regulation FD, which restricts the selective disclosure of material non-public information to, among others, broker-dealers and holders of a company’s securities under circumstances in which it is reasonably foreseeable that the holder will trade in the company’s securities on the basis of the information. These exemptions and leniencies reduce the frequency and scope of information and protections afforded to shareholders of a company that is not a foreign private issuer.

We may lose our foreign private issuer status in the future, which could result in significant additional costs and expenses.

As discussed above, we are a foreign private issuer, and therefore, we are not required to comply with all of the periodic disclosure and current reporting requirements of the Exchange Act. The determination of foreign private issuer status is made annually on the last business day of an issuer’s most recently completed second fiscal quarter, and, accordingly, the next determination will be made with respect to us on August 31, 2023. In the future, we would lose our foreign private issuer status if (1) more than 50% of our outstanding voting securities are owned by U.S. residents and (2) a majority of our directors or executive officers are U.S. citizens or residents, or we fail to meet additional requirements necessary to avoid loss of foreign private issuer status. If we lose our foreign private issuer status, we will be required to file with the SEC periodic reports and registration statements on U.S. domestic issuer forms, which are more detailed and extensive than the forms available to a foreign private issuer. We will also have to mandatorily comply with U.S. federal proxy requirements, and our officers, directors and principal shareholders will become subject to the short-swing profit disclosure and recovery provisions of Section 16 of the Exchange Act. As a U.S.-listed public company that is not a foreign private issuer, we will incur significant additional legal, accounting and other expenses that we will not incur as a foreign private issuer.

Our independent registered public accountants have identified material weaknesses in our internal controls over financial reporting in 2023. If we are unable to remediate these material weaknesses, we may not be able to report our financial results accurately, prevent fraud or file our periodic reports as a public company in a timely manner.

In connection with the audit of our financial statements for the years ended February 28, 2023 and 2022, and the related statements of loss and comprehensive loss, changes in shareholders’ equity (deficiency), and cash flows for the years ended February 28, 2023, 2022 and 2021, and the related notes and schedules (collectively referred to as the “financial statements”), our independent registered public accountants identified two material weaknesses in our internal control over financial reporting. A “material weakness” is a deficiency, or a combination of deficiencies, in internal control over financial reporting such that there is a reasonable possibility that a material misstatement of our annual or interim financial statements will not be prevented or detected on a timely basis.

In 2023, our independent registered public accountants identified the following material weaknesses in our internal control over financial reporting. The first material weakness related to the Company's preparation of its year-end financial statements, including ineffective resources to ensure correct application of IFRS guidance and review of financial statements. As a result, there were material errors in the accounting over equity instruments and flow through liability. The second material weakness related to the Company's financial statement close process and in preparing its year-end financial statements, including ineffective resources to ensure timely preparation and review of account reconciliations and cut-off. As a result, there were material errors in the accounting over prepaids.

For the material weaknesses identified in our 2023 audit, we will take steps to remediate these material weaknesses, and to further strengthen our accounting staff and internal controls. However, to date, we have not remediated the material weaknesses identified in 2023 above. We cannot be certain that other material weaknesses and control deficiencies will not be discovered in the future. If our efforts to remediate these material weaknesses are not successful or other material weaknesses or control deficiencies occur in the future, we may be unable to report our financial results accurately on a timely basis or help prevent fraud, which could cause our reported financial results to be materially misstated and result in the loss of investor confidence or delisting and cause the market price of our common shares to decline.

We will begin to take steps immediately to remediate these material weaknesses and strengthen our internal control over financial reporting, including the following:

While we believe that these efforts will improve our internal control over financial reporting, the implementation of these measures will be ongoing and will require validation and testing of the design and operating effectiveness of internal controls over a sustained period of financial reporting cycles. We cannot assure you that the measures we intend to take, will be sufficient to maintain effective internal control over financial reporting. Accordingly, there could continue to be a reasonable possibility that a misstatement of our accounts or disclosures that would result in a material misstatement of our financial statements that would not be prevented or detected on a timely basis.

We believe that we were a passive foreign investment company (“PFIC”) for our tax year ending February 28, 2023 and may be classified as a PFIC for our current tax year or future tax years which could result in adverse U.S. federal income tax consequences for U.S. Holders of our Common Shares.

Generally, if for any tax year, at least 75% of our gross income is passive income, or at least 50% of the value of our assets is attributable to assets that produce passive income or are held for the production of passive income, including cash, we would be characterized as a passive foreign investment company, or PFIC, for U.S. federal income tax purposes. The determination of whether we are a PFIC depends on the particular facts and circumstances (such as the valuation of our assets, including goodwill and other intangible assets, and the composition of our income) and may also be affected by the application of the PFIC rules, which are subject to differing interpretations. In addition, for purposes of the PFIC asset test, the value of our assets will depend in part on the market price of our Common Shares, which may fluctuate significantly. Based on the composition of our activity and the fact that we are not yet producing revenue from our active operations, we believe we were a PFIC for our tax year ending February 28, 2023 and based on our current business plans and financial expectations we may be a PFIC in our current tax year and subsequent tax years, which could result in adverse U.S. federal income tax consequences for U.S. Holders (as defined under Item 10.E “Taxation-Certain Material U.S. Federal Income Tax Considerations” below) of our Common Shares.  If we are a PFIC, U.S. Holders of our Common Shares may be subject to adverse U.S. federal income tax consequences, such as the ineligibility for any preferred tax rates on capital gains or on actual or deemed dividends, potentially having a deemed interest charge applied to distributions by us and the U.S. Holder’s amount realized on a sale of the Common Shares, and additional reporting requirements under U.S. federal income tax laws and regulations. A U.S. Holder who holds stock in a foreign corporation during any year in which such corporation is a PFIC may be subject to United States federal income taxation under alternative tax regimes at the election of each such U.S. Holder. The United States federal income tax consequences to a U.S. Holder of the acquisition, ownership, and disposition of Common Shares will depend on whether such U.S. Holder makes an election to treat the Company as a qualified electing fund (“QEF”) under Section 1295 of the Internal Revenue Code of 1986, as amended (the “Code”), or a mark-to-market election under Section 1296 of the Code. However, U.S. Holders should be aware that there can be no assurance that we will satisfy the record keeping requirements that apply to a QEF, or that we will supply U.S. Holders with information that such U.S. Holders may require to report under the QEF election rules, in the event that we are a PFIC, and a U.S. Holder wishes to make a QEF election. Thus, U.S. Holders may not be able to make a QEF election with respect to their Common Shares. Investors should consult their own tax advisors regarding all aspects of the application of the PFIC rules to our Common Shares. For more information related to PFIC classification, see 10.E “Taxation-Certain Material U.S. Federal Income Tax Considerations–Passive Foreign Investment Company Considerations” below.

U.S. securityholders may not be able to enforce their civil liabilities against us or our directors, controlling persons and officers.

It may be difficult for securityholders in the United States to enforce actions against us on the basis of U.S. securities law liabilities. We are a corporation incorporated under the Business Corporations Act (British Columbia). All of our directors and officers are residents of Canada and all of our assets are located outside of the U.S. Consequently, it may be difficult for U.S. securityholders to effect service of process in the U.S. upon those directors or officers who are not residents of the U.S., or to realize in the U.S. upon judgments of U.S. courts predicated upon civil liabilities under U.S. securities laws. In addition, you should not assume that the courts of Canada (i) would enforce judgments of U.S. courts obtained in actions against us or such persons predicated upon the civil liability provisions of the U.S. federal securities laws or other laws of the United States, or (ii) would enforce, in original actions, liabilities against us or such persons predicated upon the U.S. federal securities laws or other laws of the United States.

Certain of our officers and directors may have conflicts of interest, which could have a negative effect on our operations.

Members of the Board may become directors of other reporting companies or have significant shareholdings in other resource companies and, to the extent that such other companies may participate in ventures in which we may participate, the Board may have a conflict of interest in negotiating and concluding terms respecting the extent of such participation.

General Risks

We are subject to risks arising from epidemic diseases, such as the COVID-19 pandemic.

Our business, operations, and financial condition, and the market price of our Common Shares could be materially and adversely affected by the outbreak of epidemics or pandemics or other health crises, including the COVID-19 pandemic. To date, there have been a large number of temporary business closures, quarantines, and a general reduction in consumer activity in a number of countries. The pandemic has caused companies and various international jurisdictions to impose travel, gathering and other public health restrictions. While these effects are expected to be temporary, the duration of the various disruptions to businesses locally and internationally and the related financial impact cannot be reasonably estimated at this time. Similarly, we cannot estimate whether or to what extent this pandemic and the potential financial impact may extend to countries outside of those currently impacted. Such public health crises can result in volatility and disruptions in the supply and demand for minerals, global supply chains and financial markets, as well as declining trade and market sentiment and reduced mobility of people, all of which could affect commodity prices, interest rates, credit ratings, credit risk, share prices and inflation. The risks to us of such public health crises also include risks to employee health and safety, a slowdown or temporary suspension of operations in geographic locations impacted by an outbreak, increased labour and fuel costs, regulatory changes, political or economic instabilities or civil unrest. At this point, the extent to which COVID-19 will or may impact us is uncertain and these factors are beyond our control; however, it is possible that COVID-19 may have a material adverse effect on our business, results of operations, and financial condition and the market price of the Common Shares.

Corporate Overview

First Phosphate Corp. is a mineral resource exploration company focused on the exploration, development, and commercialization of mineral resource projects, particularly with respect to the LFP Battery industry.

Our corporate office is located at 1055 West Georgia Street, 1500 Royal Centre, P.O. Box 11117, Vancouver, British Columbia, V6E 4N7, Canada. The Company’s registered office is located at 1055 West Georgia Street, 1500 Royal Centre, P.O. Box 11117, Vancouver, British Columbia, V6E 4N7, Canada. Our telephone number is +1 416 200-0657.

Additional information related to the Company is available on SEDAR+ at www.sedarplus.ca and https://www.firstphosphate.com/. We do not incorporate the contents of our website or of www.sedarplus.ca into this Registration Statement. Information on our website does not constitute part of this Registration Statement.  In addition, the U.S. Securities and Exchange Commission (the “SEC”) maintains an internet site that contains reports, proxy and information statements, and other information regarding issuers that file electronically with the SEC which can be viewed as www.sec.gov.

The Company’s Common Shares are listed for trading on the CSE under the trading symbol “PHOS” and on the FSE under the trading symbol “KD0.”

The authorized capital stock of the Company is an unlimited number of common shares and unlimited number of preferred shares issuable in series. On June 1, 2022, the Company consolidated all of its issued and outstanding Pre-Consolidation Shares on the basis of one Common Share for every 500 Pre-Consolidation Shares (the “Consolidation”). As of the date of this Form 20-F, the Company has 53,775,286 Common Shares issued and outstanding.

The Company is a reporting issuer in the provinces of Ontario, British Columbia, and Alberta.

Important Events in the Development of the Business

The Company was incorporated as Etna Resources Inc. on September 18, 2006, under the provisions of the BCBCA.

The Company filed articles of amendment on:

Three Year History

On October 23, 2020, the Company was restored. The Company announced that pursuant to its application to the Executive Director of the British Columbia Securities Commission (the “BCSC”) for a partial revocation of the order issued by the BCSC dated July 17, 2013 (the “BC CTO”), and its application to the Executive Director of the Alberta Securities Commission (the “ASC”) to vary a cease trade order issued by the ASC on October 16, 2013 (the “AB CTO”). On December 16, 2020, the BCSC issued a partial revocation order (the “Partial Revocation Order”) of the BC CTO and the ASC issued a variation order (the “Variation Order”) varying the AB CTO. The Partial Revocation Order and the Variation Order were issued solely for the purpose of permitting the Company to raise an aggregate of $80,000, including entering into the Loan Agreement and offering Pre-Consolidation Shares pursuant to a private placement, to meet its continuous disclosure obligations under NI 51-102. On March 26, 2021, the ASC and BCSC each issued an order revoking their previously issued cease trade orders in respect of the securities of the Company.

On January 8, 2021, the Company entered into a Loan Agreement with Loomac Management Ltd. (“Loomac”), of which the sole officer and director is Blaine McKearney, an arm’s length third-party to the Company. Pursuant to the terms of the Loan Agreement, the Company received a loan of $10,000 which was subsequently converted into 62,111,801 units of the Company at a price of $0.000161 per unit. Each unit consisted of one Pre-Consolidation Share and one Pre-Consolidation Share purchase warrant (a “Warrant”), with each Warrant entitling the holder to purchase one additional Pre-Consolidation Share at an exercise price of $ $0.000645 per share for a period of 60 months from the date of issue.

On March 26, 2021, the ASC and BCSC each issued an order revoking ACTO and BCCTO respectively.

On June 25, 2021, the board of directors was reconstituted to include Bennet Kurtz, John Passalacqua and Marc Branson.

On June 1, 2022, the Company completed a consolidation of its issued and outstanding Common Shares on the basis of 1 post-consolidation common share for every 500 pre-consolidation Common Shares. The consolidation was approved by the Company’s Board on May 27, 2022. This consolidation is reflected retroactively in the Company’s February 28, 2023 financial statements.

Since May 2022 the Company has been in the business of acquiring and exploring igneous rock titanium and phosphate mineral properties in the Saguenay Region of Quebec for the purposes of developing and producing phosphate concentrate, titanium concentrate and iron concentrate and eventually phosphoric acid for use in lithium iron phosphate (LFP) batteries for the electric vehicle (EV) industry. The Company operates in an industry with immense growth potential. The global lithium iron phosphate battery market size was USD $8.37 billion in 2020 and is projected to grow from USD $10.12 billion in 2021 to USD $49.96 billion by 2028 at a CAGR of 25.6% during the forecast period 2021-2028. Fortune Business Insights™ has mentioned these insights in its latest research report, titled, “Global Lithium Iron Phosphate Battery Market, 2021-2028.”

LFP value chain starts with high purity igneous rock deposits which the Company has access to and gives it a competitive advantage. The Company has obtained permit applications to begin drilling in 2023, one for Lac Original, and one for Begin-Lamarche. Further, on July 1, 2022, the Company entered into a partnership with Queen’s University in advanced formulation and process integration which was announced on September 21, 2022. The proposed project is to support postdoctoral – level research focused on fully characterizng the nature of phosphorite occurrence at Lac à l’Orignal. The Company will be provided with detailed mineralogy and geochemistry of phosphatic minerals that complements.

On June 17, 2022, the Company entered into a mineral option agreement (the “Mineral Option Agreement”) with Glen Eagle, an arm’s length third-party to the Company, which provided the Company the right to acquire a 100% legal and beneficial interest in the Property, subject to an existing 1% net-smelter royalty (“NSR”). Pursuant to the Mineral Option Agreement, as amended on August 22, 2022 and September 12, 2022 the Company acquired the interest in the Property by paying a total cash consideration of $1,241,000 and a promissory note in the amount of $250,000 as well as an issue of 6,000,000 Common Shares to Glen Eagle. As of September 14, 2022, the Company fully purchased the Property from Glen Eagle. 

Permits

In a press release dated October 26, 2022, the Company announced that it received drilling permits for its Lac à l’Orignal and Bégin-Lamarche properties. Drilling activities will be carried out by Forage Premières Nations – First Nations Drilling of Mashteuiatsh, Québec and will comprise job training opportunity for aspiring local youth.

On June 23, 2022, the Company announced that Bennett Kurtz resigned as CEO, John Passalacqua was appointed CEO, and Laurence W. Zeifman joined the board of directors.

On August 25, 2022, Peter Kent joined the Company’s board of directors. On September 28, 2022, Mr. Kent was appointed President of the Company.

On January 10, 2023, the Company signed an LFP Production Technology Licensing Agreement with IPL. IPL will validate the Company’s LFP-grade purified phosphoric acid and iron sulphate for the use in LFP battery cells. IPL’s LFP CAM homologation process will use First Phosphate LFP-grade PPA and iron sulphate. IPL will provide an LFP production technology license to the Company in the production of LFP CAM at any First Phosphate LFP CAM production facilities to be built in Quebec or elsewhere in North America. A royalty fee of 1.5% will apply to all LFP CAM sales. The Company has acquired 7,386 common shares of IPL for a cost of $83,060 and has the right to make follow-on investments in future funding rounds. The Company was informed that IPL closed its oversubscribed equity investment round which received co-investment by the UK government grant funded project for LFP battery material pilot plant development. The IPL pilot plant is expected to be operational by the end of 2023. IPL has since relocated to a new larger facility to begin the buildout of its pilot plant. Upon completion, First Phosphate will be supplying samples of its PPA and iron sulphate to be used in the IPL input materials homologation process. IPL is expected to produce LFP Cam and test LFP battery cells using the Company’s input materials during 2024.

Partnership with Queen’s University Pufahl Research Group

On September 21, 2022, the Company first announced its partnership with the Pufahl Research Group at Queen’s University, Canada. The primary goal of the partnership is to determine the detailed mineralogy and geochemistry of phosphatic ore and waste minerals at Lac à l’Orignal, a step which complements the bulk geochemical assays and metallurgy being conducted by SGS Canada Inc. (Quebec / Lakefield). The acquisition of such high-resolution data using state-of-the art microscopy techniques is critical for understanding small variations in the chemistry of minerals forming the anorthosite host rock on a micron scale. Anorthosites are a rare and underexplored source of high-purity phosphate.

On March 14, 2023, the Company announced the receipt of the final research report from Queen’s University Pufahl Research Group completed by Dr. Sandeep Banerjee, Postdoctoral Researcher and dated March 13, 2023: “Characterization of First Phosphate’s Lac à l’Orignal Phosphate Deposit, Lac-Saint-Jean Anorthosite (LSJA) Complex, Quebec, Canada: Implications for Supplying Lithium Ferro (Iron) Phosphate (LFP) Batteries”.

On February 22, 2023, the Company listed its Common Shares for trading on the CSE.

On February 28, 2023, the Company listed its Common Shares on the Frankfurt Stock Exchange under ticker symbol “KD0”.

On March 6, 2023, the Company engaged P&E Mining Consultants to complete a Preliminary Economic Assessment (PEA) at the Lac à l’Orignal property.

On March 9, 2023, the Company announce initial drill results from its Bègin-Lamarche property located in the region of Saguenay-Lac-St-Jean, Quebec, Canada.

On March 10, 2023, the Company acquired 13 additional mineral claims in the Bégin-Lamarche claim block representing approximately 612 ha. In the region of Saguenay-Lac-St-Jean, Quebec, for the consideration of $22,825 through the issuance of 27,173 Common Share at a deemed price of $0.92 and actual price of $0.84 per Common Share pursuant to the Additional Mineral Claims Agreement. The Company now holds 2,778 royalty free claims covering an area of 1,531 sq. km in the region of Saguenay-Lac-St-Jean, Quebec, Canada.

On March 14, 2023, the Company announced that it has received the final research report from Queen’s University Pufahl Research Group completed by Dr. Sandeep Banerjee, Postdoctoral Researcher and dated March 13, 2023: “Characterization of First Phosphate’s Lac à l’Orignal Phosphate Deposit, Lac- Saint-Jean Anorthosite (LSJA) Complex, Quebec, Canada: Implications for Supplying Lithium Ferro (Iron) Phosphate (LFP) Batteries”. The report is available on the Company’s website.

On March 20, 2023, the Company announced the Metallurgical Testwork results on mineralization sourced from its Lac à l’Orignal Property in the region of Saguenay- Lac-St-Jean, Quebec, Canada conducted by by an independent laboratory, SGS Canada Inc., Quebec City, Quebec, and dated March 13, 2023 and titled “An Investigation Into Preliminary Metallurgical Testwork On A Phosphate Ore (Lac À L’orignal)”. The report is available on the Company’s website.

On March 24, 2023, the Company announced additional drill results from its Bégin-Lamarche property located in the region of Saguenay-Lac-St-Jean, Quebec, Canada. These additional results are further to the Company’s press release dated March 9, 2023.

On March 31, 2023, Pierre Cossette, a consultant engaged by the Company as Vice President Public and Legal Affairs of the Company resigned from service. Of the 300,000 options issued to this consultant, 225,000 options were immediately cancelled and 75,000 have vested and are exercisable until March 31, 2024.

On April 3, 2023, the Company and the Regional Conference of the Prefects of the Saguenay-Lac-Saint-Jean Region of Quebec (“CMAX”) announced a Collaboration Agreement to the benefit of the Regional Economy. Under the agreement, the Company will be able to connect directly to the region’s entrepreneurial workforce to help the Company to operate its projects in a broader context and without supplier challenges. For CMAX, this agreement will facilitate positive economic impacts for construction companies, equipment manufacturers and their suppliers in the Saguenay-Lac-Saint-Jean Region of Quebec.

On April 24, 2023, the Company issued 1,205,217 non-flow through (“non-FT”) units at $0.70 per unit for gross proceeds of $843,652. Each non-FT unit consisted of one Common Share and one half of one Common Share purchase warrant. Each whole warrant is exercisable for one additional Common Share at a price of $1.25 until April 26, 2026. The value of share capital of $614,660 was determined using the fair market value of the shares on the date of issuance and the residual proceeds of $228,992 were allocated to warrants. The Company paid $22,760 as brokers’ fees and issued 12,514 warrants as brokers’ warrants with an exercise price of $1.25 per Common Share which expire on April 24, 2026. The fair value of the broker warrants was computed as $2,900 using the Black Scholes pricing model and recorded as share issuance costs.

On April 24, 2023, the Company issued 1,869,375 flow-through (“FT”) units at $0.80 per unit for gross proceeds of $1,495,500. Each FT unit consists of one flow-through Common Share and one half of one Common Share purchase warrant. Each whole warrant is exercisable for one additional non-flow through Common Share at a price of $1.25 until April 30, 2026. The value of share capital of $1,140,320 (before deduction of $186,938 flow-through premium) was determined using the fair market value of the shares on the date of issuance and the residual proceeds of $355,180 were allocated to warrants. The Company paid $60,384 as brokers’ fees and issued 57,980 warrants as brokers’ warrants with an exercise price of $1.25 per Common Share which expire on April 24, 2026. The fair value of the warrants was computed as $13,438 using Black Scholes pricing model and recorded to share issuance costs.

On April 30, 2023, the Company issued 42,857 shares as finder’s fees for the above private placements with a fair value of $21,857. Additionally, the Company incurred legal fees of $27,994 with respect to the above private placements.

On May 11, 2023, the Company announced that members of its management team and board of directors have reached an agreement for the purchase of 50% of the escrowed Common Shares currently owned by Glen Eagle. The agreement was subject to customary closing conditions, including obtaining all necessary approvals under the escrow agreement and all applicable securities laws. Glen Eagle originally received Common Shares for the sale of the Lac à l’Orignal flagship property to the Company on September 12, 2022. The Transaction closed on June 19, 2023 for the aggregate consideration of $590,000 at the deemed price of $0.2185 per Common Share.

On May 17, 2023, the Company issued 7,143 Common Shares at $0.50 per Common Share for gross proceeds of $3,572, on the exercise of unit warrants. The fair value of warrants on the grant date was computed as $nil, accordingly no amount was reclassified upon exercise from contributed surplus to capital stock.

On May 23, 2023, Garry Siskos, CPA, CA was appointed Chief Operating Officer and Chief Financial Officer of the Company. The Company’s outgoing Chief Financial Officer, Bennett Kurtz, moved to the position of Chief Administrative Officer. Gilles Laverdière was appointed as Chief Geologist for the Company.

On May 30, 2023, the Company issued 4,480 Common Shares at $0.25 per Common Share, on the exercise of brokers’ warrants, for total proceeds of $1,120. The fair value of warrants on the grant date was computed as $601 and was reclassified upon exercise from contributed surplus to capital stock.

On May 30, 2023, the Company provided a corporate update and included a list of achievements, milestones it proposes to achieve before the end of calendar year 2023, current strategic focus, a discussion of the Company’s competitive advantages, and updates with respect to the Company’s partnerships.

On June 5, 2023, the Company announced that it obtained final winter program drill results at its Bégin-Lamarche property located in the region of Saguenay-Lac-St-Jean, Quebec, Canada. 20 holes were drilled for a total of 4,274 metres.

On June 12, 2023, Isobel Sheldon, battery executive and entrepreneur, joined the Company’s advisory board.

One June 13, 2023, the Company staked an additional 27 claims in the Lac à l’Orignal area for a cost of $1,977.75.

On June 19, 2023, the Company commissioned a solventless, environmentally friendly phosphate concentration pilot plant located at the facilities of SGS in Quebec City, Quebec, Canada (the “SGS Pilot Plant”). The SGS Pilot Plant optimises the Company’s metallurgical process for the production of a super high grade phosphate concentrate approaching 41% P2O5. The SGS Pilot Plant has produced over 900 kilograms of apatite concentrate which have been sent to the facilities of Prayon Technologies SA (“Prayon”), of Engis, Belgium, for the production of battery-grade PPA. The battery-grade PPA produced will then be sent to Company partners for homologation into their LFP CAM production processes. The SGS Pilot Plant also produces valuable, marketable recoveries of ilmenite and magnetite. The Company incurred a total of $242,995 during the months of April, May and June in 2023 with respect to the commissioning of the SGS Pilot Plant.

On June 19, 2023, the Company announced the completion of a share purchase agreement with Glen Eagle. Certain directors and officers of the Company acquired 2,700,000 Company Common Shares from Glen Eagle at $0.2185 per Common Share, amounting to a total cash payment of $590,000, pursuant to a share purchase agreement dated May 10, 2023. These shares were originally issued on August 24, 2022, at $0.250 per share to Glen Eagle under a purchase agreement for the Lac à l’Orignal property. 

On June 27, 2023, a consultant engaged by the Company as the capital markets consultant resigned from service. Of the 100,000 options issued to this consultant, 75,000 options were immediately cancelled pursuant to an option forfeiture agreement dated June 27, 2023, and 25,000 have vested and are exercisable until June 27, 2024. Additionally, on June 28, 2023, the Company settled an amount owed to him for services through the issuance of 179,104 Common Shares of the Company at $0.335 per Common Share, with such shares subject to a statutory four month and one day hold period.

On July 5, 2023, Armand MacKenzie, a First Nations mining executive, joined the Company’s advisory board.

On July 18, 2023, the Company entered into a memorandum of understanding with Norfalco, a division of Glencore Canada, to secure supply of sulfuric acid. Under the terms of the memorandum of understanding, and subject to the parties entering into a mutually agreeable definitive sulfuric acid supply agreement, the Company agreed that NorFalco will supply the sulfuric acid required for the Company’s future PPA and other industrial facilities to be located in Quebec. The Company and Norfalco agreed to continue to work together over the term of the memorandum of understanding.

On July 25, 2023, the Company announced the results of the PEA for the Lac à l’Orignal property. The property would produce annual average of 425,000 tonnes of beneficiated phosphate concentrate at over 40% P2O5 content, 280,000 tonnes of magnetite and 97,000 tonnes of ilmenite over a 14.2 year mine life. The property generates a pre-tax internal rate or return (IRR) of 21.7% and an pre-tax net present value (NPV) of $795 million at a 5% discount rate at June 30, 2023 approximate 18 month trailing average phosphate price and long term consensus magnetite and ilmenite prices. The property generates an after-tax internal rate or return (IRR) of 17.2% and an after-tax net present value (NPV) of $511 million at a 5% discount rate at June 30, 2023 approximate 18 month trailing average phosphate price and long term consensus magnetite and ilmenite prices. The property would generate an after-tax cash flow of $567 million in years 1-5, resulting in a 4.9-year payback period from start of production.

On August 25, 2023, the Company held its annual general and special meeting of shareholders where the sole special business conducted was the ratification of the Company’s Omnibus Equity Incentive Plan (“Omnibus Plan”) by disinterested shareholders. The Omnibus Plan was approved and adopted by the Board on July 26, 2023. The Omnibus Plan replaces the Stock Option Plan and the RSU Plan. The Omnibus Plan will provide the Company with the flexibility to grant diverse equity awards as part of its objective to attract, retain and motivate highly qualified directors, officers, employees and consultants, all granted under one plan which will allow such awards to be subject to the same administration and overall limits. The Omnibus Plan is a “rolling” share-based compensation plan pursuant to which the aggregate number of Common Shares reserved for issue under the Omnibus Plan may not exceed twenty percent (20%) of the Common Shares issued and outstanding at the time of Option or RSU grant. The Omnibus Plan is a “rolling” maximum share plan, and any increase or reduction in the number of outstanding Common Shares will result in an increase or reduction, respectively, in the number of Common Shares that are available to be issued under the Omnibus Plan. The Omnibus Plan is considered an “eve Under the Omnibus Plan, eligible persons may (at the discretion of the Board) be allocated a number of restricted share units as the Board deems appropriate, with vesting provisions also to be determined by the Board, subject to a maximum vesting term of three (3) years from the end of the calendar year in which RSUs were granted. Upon vesting, eligible participants shall be entitled to receive Common Shares from treasury to satisfy all or any portion of a vested RSU award. The expiry date of Options granted pursuant to the Omnibus Plan is set by the Board, and must not be later than ten (10) years from the date of grant.

On September 1, 2023, the Company reported up to 36.5% Phosphate Assay Result at Its Larouche Property in Saguenay-Lac-St-Jean, Quebec, Canada and certain corporate updates. Peter Kent retired as President and Director of the Company. Mr. Kent remains involved with the Company as a member of its advisory board. Garry Siskos stepped down as COO/CFO of the Company to pursue fundraising opportunities in his private practice and remains as a consultant to the Company. Bennett Kurtz, the predecessor CFO to Garry, was appointed as the Company’s CFO in addition to his roles as the Company’s CAO, Corporate Secretary, and Director. The Company approved the grant of 250,000 stock options to each of two advisors of the Company (500,000 Options in aggregate), at an exercise price of $0.70 per share, with an expiry date of three years from the date of issuance (the “Option Grants”). The Options are subject to time-based vesting such that increments of 25% vest every 6 months for two years. The terms of the Options granted are in accordance with the Company’s Omnibus Equity Incentive Plan as approved by disinterested shareholders at the Company’s annual and special meeting of shareholders held on August 25, 2023. All securities issued are subject to a statutory hold period of four months plus one day from the date of issuance, in accordance with applicable securities legislation. The Company settled $273,200 of debt for accrued management and board salaries through the issuance of 718,947 Common Shares at the deemed price of $0.38 per Common Share, with such shares subject to a statutory four month and one day hold period (the “D&O Shares for Accounts Payable Transaction”). Further, the Company has settled $216,676 of debt for accrued amounts owing to arm’s length service providers through the issuance of 570,200 Common Shares at the deemed price of $0.38 per Common Share, with such shares subject to a statutory four month and one day hold period. The Company announced the grant of RSUs of the Company to certain directors, officers, and consultants of the Company in lieu of cash compensation. The Company granted 1,018,424 RSUs to certain directors, officers, and consultants of the Company in lieu of cash compensation. Such RSUs will vest in 2 tranches after 3 and 6 months of issuance and will be subject to a statutory four month and one day hold period. Each vested RSU entitles the holder to receive one Common Share. The Company engaged Laura Stein for Investor Relations Activities (as defined in the CSE Policy) with the effective date of September 1, 2023. Ms. Stein’s engagement is for an initial term of 12 months ending on September 1, 2024, during which the Company has issued, as compensation to Ms. Stein 250,000 Options to vest over the course of the 12 month engagement, at the exercise price of $0.70 per Common Share, subject to minimum exercise price as set out in the CSE’s Policy. The Options are anticipated to granted at 25% per quarter over 9 months with the first 25% of such Options granted immediately.

On September 6, 2023, the Company received successful results for the pilot production of Merchant Grade Phosphoric Acid (MGA) from its phosphate concentrate. As previously announced on June 19, 2023, a 900 kilogram sample of apatite concentrate was produced at the First Phosphate pilot plant facilities at SGS Québec and was sent to the facilities of Prayon in Belgium for testing its suitability for the production of battery-grade PPA. Prayon has begun assessing product quality and process feasibility through pilot testing of the First Phosphate rock concentrate to determine the optimal process parameters for MGA production. The first initial report on the pilot testing for the production of MGA has been completed. The final report with any additional comments on the MGA production testing as well as details on the PPA production testing through membrane purification (next step) is expected to be available as planned during Q4 2023.

On September 11, 2023, the Company filed on SEDAR+ its Preliminary Economic Assessment (“PEA”) on the Lac à l’Orignal Property, Quebec, Canada. The PEA provides a viable case for developing the Property by open pit mining for the primary production of a phosphate concentrate and secondary recovery of magnetite and ilmenite concentrates. The PEA is considered by P&E Mining Consultants Inc. to meet the requirements as defined in Canadian National Instrument 43-101 Standards of Disclosure for Mineral Projects. This PEA is preliminary in nature and includes Inferred Mineral Resources that are considered too speculative geologically to have the economic considerations applied to them that would enable them to be classified as Mineral Reserves, and there is no certainty that the PEA will be realized. Mineral Resources are not Mineral Reserves and do not have demonstrated economic viability. There is no guarantee that First Phosphate will be successful in obtaining any or all of the requisite consents, permits or approvals, regulatory or otherwise, for the project to be placed into production. The PEA has an effective date of July 25, 2023, and the report is dated September 11, 2023.

On September 13, 2023, the Company announced that, it has entered into an agreement with American Battery Factory Inc. (“ABF”) of Utah, USA, pursuant to a memorandum of understanding, to support production of up to 40,000 tonnes of annual fully North American manufactured LFP CAM (the “ABF Agreement”). The initiative aims to bring production of LFP Batteries for the battery storage sector to North America. The following mutually beneficial arrangements in connection with the ABF Agreement were also announced:

On September 29, 2023, the Company announced that it received a letter of interest from the Export-Import Bank of the United States (“EXIM”), where EXIM express that it would be able to provide financing in the amount of up to USD $170,000,000.00 to the Corporation. The letter of interest is in support of the procurement of U.S. goods and services by First Phosphate in Canada and is eligible for a maximum repayment term of 10 years and expires on October 14, 2024. We note that the letter of intent does not represent a financing commitment and does not guarantee the Company’s access to any or all financing from EXIM. EXIM is to conduct its standard due diligence prior to issuing a final commitment for this transaction. All final commitments must be in compliance with EXIM policies as well as program, legal and eligibility requirements.

On October 10, 2023, the Company announced that it had appointed Jérôme Cliché, effective October 5, 2023, its Vice-President, Business Development. Mr. Cliché is experienced in the areas of corporate finance, strategic investment and corporate development. Mr. Cliché is the co-founder of Renmark Financial Communication, a Montreal based company offering a range of integrated services to small, medium, and large cap public companies trading on all major North American stock exchanges. The Company granted 150,000 options exercisable at $0.70 per share to Jérôme Cliché. The options vest in increments of 33% every four months after October 5, 2023. These options expire on October 5, 2026. On October 5, 2023, Jérôme Cliché was granted 338,462 RSUs. The RSUs vest as follows: (i) 25% vested on October 5, 2023 (ii) increments of 25% every three months after October 5, 2023.

On November 29, 2023, the Company entered into a non-binding memorandum of understanding with Sun Chemical Corporation (“Sun Chemical”) for the development of intermediates used for the manufacture of LFP CAM to support the developing North American battery market. Under this agreement, Sun Chemical will use its qualified North America facilities to manufacture iron phosphate using the phosphate material of First Phosphate and its partners. Utilizing the network of both companies, the agreement will include the investigation of the best source of iron to use in the iron phosphate and lithium iron phosphate synthesis process with preferred consideration for Sun Chemical’s current manufacturing capabilities of iron oxide precursors and First Phosphate’s mining source recovery of magnetite.

On December 6, 2023, the Company entered into a memorandum of understanding with Lithium Australia Limited (“LIT”) (ASX: LIT) for the potential development of an LFP and LMFP CAM manufacturing plant in North America. LIT has developed proprietary technology to produce LFP / LMFP CAM through its wholly owned subsidiary VSPC Pty Ltd (“VSPC”). LIT is seeking a partner to support the commercialization of its LFP / LMFP technology through the development, construction and operation of a demonstration plant (“Demo Plant”) and an eventual commercial scale manufacturing facility (“Commercial Plant”).

The terms of the agreement include:

LIT has a conditional first right of refusal for offtake of up to 30% of spodumene produced by the Lake Johnston Lithium Project (“Spodumene Offtake”). If a JDA is established, LIT’s Spodumene Offtake may be accessed to provide lithium units in favour of the JDA. The Lake Johnston Lithium Project is a prospective lithium exploration opportunity located 450km east of Perth, Western Australia owned by Charger Metals NL (ASX: CHR) and Rio Tinto Limited (ASX: RIO) (LON: RIO).

The term of the MOU is two years commencing on the date of signing, or such later date as is agreed in writing between the parties.

On December 11, 2023, the Company signed a memorandum of understanding with Ultion Technologies Inc (“Ultion”) of Las Vegas, Nevada for the purchase of a non-exclusive, perpetual license to technology for the production of LFP and LFMP CAM. The LFP technology contemplated by the memorandum of understanding is currently in production in two facilities, one with 10,000 tons per annum of capacity and one with 50,000 tons per annum of capacity. The LFMP technology contemplated in the memorandum of understanding is currently under development and being produced at a quantity of several tonnes per month. The memorandum of understanfing is effective as of December 11, 2023 and shall remain in effect until the Parties enter into a definitive, written agreement or 365 days, whichever comes first. The terms of the agreement between the parties include:

Exploration Program

The Company’s next significant milestone is to advance it’s Lac à l’Orignal Phosphate project following completion of its PEA. This consists of a two-phase exploration and development program, as follows:

Phase 1 – On July 25, 2023 the Company announced the results of the PEA for the Lac à l’Orignal property. The Property would produce annual average of 425,000 tonnes of beneficiated phosphate concentrate at over 40% P2O5 content, 280,000 tonnes of magnetite and 97,000 tonnes of ilmenite over a 14.2 year mine life. The Property generates a pre-tax internal rate or return (IRR) of 21.7% and an pre-tax net present value (NPV) of $795 million at a 5% discount rate at June 30, 2023 approximate 18 month trailing average phosphate price and long term consensus magnetite and ilmenite prices. The Property generates an after-tax internal rate or return (IRR) of 17.2% and an after-tax net present value (NPV) of $511 million at a 5% discount rate at June 30, 2023 approximate 18 month trailing average phosphate price and long term consensus magnetite and ilmenite prices. The Property would generate an after-tax cash flow of $567 million in years 1-5, resulting in a 4.9-year payback period from start of production.

Phase 2 – the Company will determine the specifics now that Phase 1 PEA level studies are complete. The Company will at this point decide how to conduct environmental baseline studies commence on the Lac à l’Orignal property and deeper stakeholder engagement and consultations (Quebec BAPE) will be considered. The baseline studies should focus on aquatic, terrestrial and hydrological monitoring and documentation. A formal community, government, and stakeholder consultation plan should be developed and implemented, and all activities documented. This Phase will also include pre-feasibility studies (whether internal or formalized) as well as advanced metallurgical studies, definition drilling activities all in view to moving to a formal feasibility study. 

The Company intends to use its financial resources primarily in the exploration and development of the Property.

To the extent that additional funds are available beyond what is required by the Company in regard to exploring and developing studies on the Property, the Company may consider acquisitions of additional exploration properties.

The Company's immediate short-term objectives will be to:

(a)        based on the success of Phase 1 at the Property, decide on how to approach and complete the second phase exploration and development program as recommend in the Technical Report to proceed to a pre-feasibiltiy study (internal or formal) and eventually determine whether to proceed to a feasibility study.

The costs to complete the Phase 1 program were originally estimated to be $495,000 and estimated to take 12 months to complete. The Company is pleased that the Phase 1 program was completed ahead of schedule and within the expected budget. 

Principal Capital Expenditures and Divestitures

During the three fiscal years ended February 28, 2023, 2022 and 2021, the Company made the following expenditures and issuances:

On January 8, 2021, the Company entered into a Loan Agreement with Loomac Management Ltd. (“Loomac”), of which the sole officer and director is Blaine McKearney, an arm’s length third-party to the Company. Pursuant to the terms of the Loan Agreement, the Company received a loan of $10,000 which was subsequently converted into 62,111,801 units of the Company at a price of $0.000161 per unit. Each unit consisted of one Pre-Consolidation Share and one Pre-Consolidation Share purchase warrant, with each Warrant entitling the holder to purchase one additional Pre-Consolidation Share at an exercise price of $ $0.000645 per share for a period of 60 months from the date of issue.

On June 17, 2022, the Company entered into the Mineral Option Agreement with Glen Eagle, which provided the Company the right to acquire a 100% legal and beneficial interest in the Property, subject to an existing 1% NSR. Pursuant to the Mineral Option Agreement, as amended on August 22, 2022 and September 12, 2022 the Company acquired the interest in the Property by paying a total cash consideration of $1,241,000 and a promissory note in the amount of $250,000 as well as an issue of 6,000,000 Common Shares to Glen Eagle. As of September 14, 2022, the Company fully purchased the Property from Glen Eagle.

On January 10, 2023, the Company entered into a joint LFP homologation agreement and LFP production technology licensing agreement with Integrals Power Limited (“IPL”) of Milton Keynes, United Kingdom. IPL will validate the Company’s LFP-grade purified phosphoric acid and iron sulphate for the use in LFP battery cells. IPL’s LFP CAM homologation process will use First Phosphate LFP-grade PPA and iron sulphate. IPL will provide an LFP production technology license to the Company in the production of LFP CAM at any First Phosphate LFP CAM production facilities to be built in Quebec or elsewhere in North America. A royalty fee of 1.5% will apply to all LFP CAM sales. The Company has acquired 7,386 common shares of IPL for a cost of $83,060 and has the right to make follow-on investments in future funding rounds. The Company was informed that IPL closed its oversubscribed equity investment round which received co-investment by the UK government grant funded project for LFP battery material pilot plant development. The IPL pilot plant is expected to be operational by the end of 2023. IPL has since relocated to a new larger facility to begin the buildout of its pilot plant. Upon completion, First Phosphate will be supplying samples of its PPA and iron sulphate to be used in the IPL input materials homologation process. IPL is expected to produce LFP Cam and test LFP battery cells using the Company’s input materials during 2024.

On March 9, 2023, the Company acquired 13 additional mineral claims in the Bégin-Lamarche claim block representing approximately 612 ha. in the region of Saguenay-Lac-St-Jean, Quebec, for the consideration of $22,825 through the issuance of 27,173 Common Share at a deemed price of $0.92 and actual price of $0.84 per Common Share.

On April 24, 2023, the Company issued 1,205,217 non-flow through (“non-FT”) units at $0.70 per unit for gross proceeds of $843,652. Each non-FT unit consisted of one Common Share and one half of one Common Share purchase warrant. Each whole warrant is exercisable for one additional Common Share at a price of $1.25 until April 26, 2026. The value of share capital of $614,660 was determined using the fair market value of the Common Shares on the date of issuance and the residual proceeds of $228,992 were allocated to warrants. The Company paid $22,760 as brokers’ fees and issued 12,514 warrants as brokers’ warrants with an exercise price of $1.25 per Common Share which expire on April 24, 2026. The fair value of the broker warrants was computed as $2,900 using the Black Scholes pricing model and recorded as share issuance costs.

On April 24, 2023, the Company issued 1,869,375 flow-through (“FT”) units at $0.80 per unit for gross proceeds of $1,495,500. Each FT unit consists of one flow-through Common Share and one half of one Common Share purchase warrant. Each whole warrant is exercisable for one additional non-flow through Common Share at a price of $1.25 until April 30, 2026. The value of share capital of $1,140,320 (before deduction of $186,938 flow-through premium) was determined using the fair market value of the Common Shares on the date of issuance and the residual proceeds of $355,180 were allocated to warrants. The Company paid $60,384 as brokers’ fees and issued 57,980 warrants as brokers’ warrants with an exercise price of $1.25 per Common Share which expire on April 24, 2026. The fair value of the warrants was computed as $13,438 using Black Scholes pricing model and recorded to share issuance costs.

On April 30, 2023, the Company issued 42,857 shares as finder’s fees for the above private placements with a fair value of $21,857. Additionally, the Company incurred legal fees of $27,994 with respect to the above private placements.  

On May 11, 2023, the Company announced that members of its management team and board of directors have reached an agreement for the purchase of 50% of the escrowed Common Shares currently owned by Glen Eagle. The agreement was subject to customary closing conditions, including obtaining all necessary approvals under the escrow agreement and all applicable securities laws. Glen Eagle originally received Common Shares for the sale of the Lac à l’Orignal flagship property to the Company on September 12, 2022. The Transaction closed on June 19, 2023 for the aggregate consideration of $590,000 at the deemed price of $0.2185 per Common Share.

On May 17, 2023, the Company issued 7,143 Common Shares at $0.50 per Common Share for gross proceeds of $3,572, on the exercise of unit warrants. The fair value of warrants on the grant date was computed as $nil, accordingly no amount was reclassified upon exercise from contributed surplus to capital stock.

On May 30, 2023, the Company issued 4,480 Common Shares at $0.25 per Common Share, on the exercise of brokers’ warrants, for total proceeds of $1,120. The fair value of warrants on the grant date was computed as $601 and was reclassified upon exercise from contributed surplus to capital stock.

On June 27, 2023, a consultant engaged by the Company as the capital markets consultant resigned from service. Of the 100,000 options issued to this consultant, 75,000 options were immediately cancelled pursuant to an option forfeiture agreement dated June 27, 2023, and 25,000 have vested and are exercisable until June 27, 2024. Additionally, on June 28, 2023, the Company settled an amount owed to him for services through the issuance of 179,104 Common Shares of the Company at $0.335 per Common Share, with such Common Shares subject to a statutory four month and one day hold period.

During the three fiscal years ended February 28, 2023, 2022 and 2021, the Company made no material divestitures.

Overview

First Phosphate is a mineral development company fully dedicated to extracting and purifying phosphate for the production of cathode active material for the LFP Battery industry. First Phosphate is committed to producing at high purity level, at full ESG standard and with low anticipated carbon footprint.

First Phosphate plans to vertically integrate from mine source directly into the supply chains of major North American LFP Battery producers that require battery grade LFP CAM emanating from a consistent and secure supply source.

Since May, 2022 the Company has been in the business of acquiring, exploring and developing igneous anorthosite rock mineral properties in the Saguenay-Lac-St-Jean Region of Quebec for the purposes of developing and producing apatite (phosphate) concentrate, ilmenite (titanium) concentrate and magnetite (iron) concentrate. The Company now holds over 1,500 sq. km of royalty-free district-scale land claims.

The Company’s mining properties are located in Quebec, a North American electrification industry hub. The properties are strategically located in proximity to the City ^of Saguenay, Quebec’s 6th largest city, with a skilled industrial workforce. Bagotville Airport is within vicinity, with daily flights to Montreal. The Company has access to the deep sea Port of Saguenay for international shipment of its concentrates as well as the ability to locate industrial facilities at the Port of Saguenay. Clean Quebec Hydro is present in the vicinity of many of the Company’s mining claims as well as at the Port of Saguenay. The Company’s flagship property of Lac à l’Orignal as well as Bégin-Lamarche are located on four season, heavy haul gavel roads connected to a paved provincial highway and to the Port of Saguenay. The Company has a formal memorandum of understanding (MOU) in place with the Port of Saguenay.

Through prudent downstream partnerships, the Company plans to vertically integrate from mine source to eventual production of purified phosphoric acid and LFP CAM for use in the manufacture of LFP Batteries for various industries such as energy storage, electric vehicles (EV) and other industries. To this effect, the Company has signed a formal MOU with Prayon of Engis, Belgium, a producer of PPA. The Company has also signed an LFP production technology licensing agreement with IPL of Milton Keynes, United Kingdom.

The Company is preparing to position itself as a mineral development company fully dedicated to extracting and purifying phosphate for the eventual downstream production of CAM for the LFP Battery industry. The Company’s history of the last three financial years is described above under Item 4.A “History and Development of the Company.”

As of October 30, 2023, the Company has budgeted a cash requirement of $946,650 for the subsequent 15-month period ending January 31, 2025.

As of the date of this Form 20-F, the management team of the Company does not expect any material changes to the business; however, as is typical of the mineral exploration and development industry, from time to time First Phosphate reviews potential merger, acquisition, investment and joint venture transactions and opportunities that could enhance shareholder value.

Furthermore, there can be no assurance that the results of exploration or development programs planned or underway will not result in material changes to the scientific and technical information contained herein. Accordingly, readers of this Form 20-F are urged to read the press releases issued by First Phosphate once they become available on SEDAR+ or EDGAR, for full and up-to-date information concerning the Company’s business and its material exploration property interests.

Business Objectives and Milestones

In 2023, the Company completed a PEA on its on the Lac à l’Orignal Phosphate Project located in the Saguenay Lac-Saint-Jean region of Quebec. The Company has engaged P&E Mining Consultants Inc. (“P&E”) to lead the PEA which will utilize the latest mineral resource estimate completed by P&E in November 2022.

The Lac à l’Orignal phosphate project contains a high-quality phosphate resource potentially suitable for LFP batteries necessary for the energy transition. Management has board approval to advance the project towards its first economic study, a PEA. The PEA will include details on project economics encompassing the separation of three–marketable concentrates - a phosphate (apatite) concentrate, a titanium oxide (ilmenite) concentrate and an iron oxide (magnetite) concentrate. The objective of the PEA is to create a mine plan, mine production schedule, capital cost estimate and an operating cost estimate incorporated into a financial model to provide total cash flow, after-tax net present value (NPV), and after-tax internal rate of return (IRR). The project concept is to outline a development opportunity around a stand-alone open pit mine and concentrator facility for all three concentrates located in the Saguenay-Lac Saint-Jean region of Quebec. The region already hosts significant existing and ongoing industrial activity including 4 aluminum smelters, an alumina refinery, forest products operations and hydroelectric power generating stations. The project design will tie into existing infrastructure including the low-to-no-carbon emissions Quebec Hydro grid, and to existing municipal and heavy-haul road networks which provide access from the Lac à l’Orignal Project directly to the deep sea port of Saguenay. The Company has in place a memorandum of understanding with Port Saguenay to ship its phosphate concentrate internationally as well as access to greenfield land on which to build eventual advanced processing facilities. The completion of the PEA is scheduled for the third quarter of 2023.

The Lac a L’Orignal Property or the Lac Original Property is an advanced exploration stage property with no current resources and reserves at this time. Additional work including drilling and development is required to advance the Lac Orignal Property to a resource stage property. Using the Offering Proceeds as set out under “Use of Proceeds” above, the Company intends, over the next twenty-four (24) months, to focus on exploration and exploration development of the Lac Orignal Property as well as other properties along the Lac Orignal Property. The work completed using the Offering Proceeds is expected to increase the density of drilling and other geological information with the goal of defining a mineral resource and advancing the Lac Orignal Property.

For further information, please see the section titled “Material Property” under Item 4.D “Property, Plants and Equipment” of this Form 20-F.

We own no producing properties and, consequently, have no current operating income or cash flow from the properties we hold, nor have we had any income from operations in the past three financial years. As a consequence, our operations are primarily funded by equity financings.

Our operations are not generally seasonal as we can conduct exploration on our properties year-round. The Company does not utilize marketing channels and there are no sales or installment sales. The Company has entered into memoranda for understanding for future sales.

All aspects of the Company’s business require specialized skills and knowledge. Such skills and knowledge include the areas of geology, mining, metallurgy, environmental permitting, corporate social responsibility, finance, and accounting. The Company faces competition for qualified personnel with these specialized skills and knowledge, which may increase costs of operations or result in delays.

The mineral exploration and mining business are extremely competitive. Competition is primarily for: (a) mineral properties that can be developed and operated economically; (b) technical experts that can find, develop and mine such mineral properties; (c) labour to operate the mineral properties; and (d) capital to finance development and operations. The Corporation competes with other mining companies, some of which have greater financial resources and technical facilities, for the acquisition of mineral concessions, claims, leases, and other interests, to finance its activities and in the recruitment and retention of qualified employees. The ability of the Corporation to acquire and develop precious metal properties will depend not only on its ability to raise the necessary funding but also on its ability to select and acquire suitable prospects for precious metal development and operation or metal exploration. See “Risks Associated with Our Operations and Mineral Exploration” and “Financing Risks” under “Risk Factors” of this Form 20-F.

See “Risks Associated with Our Operations and Mineral Exploration” and “Risks Relating to our Common Shares” under “Risk Factors” of this Form 20-F for a description of the supplies and equipment the Company needs to conduct exploration, including a description of volatility in the resource market.

The Company places great emphasis on providing a safe and secure working environment for all of First Phosphate’s employees, and recognizes the importance of operating in a sustainable manner. The Company believes awareness and communication of risks are critical steps in preventing accidents on the property interests operated by the Company. There were no significant environmental incidents at any of the exploration properties at which the Company is the operator through the twelve months ended February 28, 2023. First Phosphate is subject to federal and provincial environmental laws and regulations. Management have put in place ongoing monitoring programs at the Company’s properties. Many of the Company’s activities are subject to periodic monitoring by government agencies with respect to environmental protection plans and practices, which in many circumstances must be detailed when applying for exploration permits. See “Risks Associated with Our Operations and Mineral Exploration” under “Risk Factors” of this Form 20-F.

The Company understands that having a strong social presence will be imperative to the success of its business. Ensuring that the local communities have an understanding of and appreciation for, the potential impacts of exploration, development and mining activity in the region will be a focus going forward. Fortunately, the Saguenay, Quebec area has a tremendous mining history where the local communities have a strong understanding of the benefits and risks that a mining project can bring to an area. As the project on the Property advances and exploration and development plans are confirmed, management plans to engage with community members, to solicit and respond to feedback and concerns raised from concerned citizens. The Company may also host property tours for interested members of the community.

On a regular basis, the Company will:

The Company is not part of a group, and the Company does not own any subsidiaries.

Summary Disclosure Regarding All Mineral Properties

We currently hold interests in 3 mineral properties, each of which is in the exploration stage:

Material Property

Description of the Property

Our principal asset is the Lac à l’Orignal Property in Québec, Canada.

Location and Coordinates

The Lac Orignal property is located 82 km north-northeast of the City of Saguenay in the province of Québec in Canada. The Property is centered approximately on the Lac Orignal Deposit at longitude 70° 34’ 41” W and latitude 49° 04’ 28” N (UTM NAD83 Zone 19N coordinates: 384,750 m E and 5,436,930 m N). The Property is located on NTS sheets 22D10, 22D14, 22D15, 22D16, 22E01, 22E02 and 22E03.

LAC ORIGNAL PROPERTY LOCATION, QUÉBEC

Source: Laverdière (2014)

Property Description and Tenure

The Lac Orignal Property consists of 1,417 CDC claims with a total area of 78,141 ha on NTS sheets 22D10, 22D14, 22D15, 22D16, 22E01, 22E02 and 22E03 (Figure 32). All the claims of the Lac Orignal Property are registered with the Ministry of Natural Resources and Forests (MNRF).

A list of all the claims is presented in Appendix H of the Technical Report Summary, attached as Exhibit 17.1 to this Registration Statement.

Lac Orignal Property Claims

Source: P&E (October 2022)

Note: Claims information effective June 2, 2023

Of the 1,417 claims constituting the Property, 1,264 claims were map-staked by First Phosphate and First Phosphate holds 100% interest in these claims.

In addition, First Phosphate signed option agreements with two separate parties in June 2022. On June 17, 2022, First Phosphate signed the first option agreement (as amended), with Glen Eagle Resources Inc. (“GER”), whereby First Phosphate can acquire a 100% interest, subject to an existing 1% net smelter return (NSR) royalty, in 108 claims comprising the Lac Original Deposit, by:

The Company purchased the 1% NSR royalty relating to this property for $50,000. Further, the Company issued 700,000 shares at $0.02 per share as finder's fees for the mineral property. 

The current Mineral Resource described in Section 14 of this Report are covered by claims in the centre of the Glen Eagle Option; specifically mining claims 2309155, 2309156, 2309157, 2309158, 2309159, 2309166, 2309167, 2309168, 2309169 and 2309170. These 10 mining claims are in good standing as of the effective date of the Technical Report Summary attached as Exhibit 17.1 to this Registration Statement. Please see Appendix H in the Technical Report Summary.

Also on June 17, 2022, First Phosphate entered into the second option Agreement with two individuals (“Dallaire Option”). First Phosphate can acquire 100% interest in the 11 claims of the Lac Orignal Property area by paying to the Optionor a total of $90,000 as follows:

In the event that it executed a Going Public Transaction (“GPT Transaction”), First Phosphate was entitled to elect to make the payment described in (a)(ii), through the issuance of Shares at a price equal to the GPT Transaction deemed Share price. However, on September 14, 2022, First Phosphate announced the completion of its primary phosphate land acquisition strategy, having fully purchased under full title all existing claims that it had under option from the third parties, including an additional seven claims of the Hamann Block. All the acquired claims are free and clear of any NSR royalties and all other forms of royalty.

Additional First Phosphate properties are present in the Saguenay-Lac-Saint-Jean region (i.e., Fleury, Yves, Gouin, Catherine, Begin, Sault, Perron, Antoine, Alex, Brochet and Lamarche). However, only the Lac Orignal Property is covered by the Technical Report Summary, attached as Exhibit 17.1 to this Registration Statement.

Status of Exploration Expenditures

As of the effective date of the Technical Report Summary, attached as Exhibit 17.1 to this Registration Statement, the accumulated total exploration expenditures incurred in 2022 on the Lac Orignal Property were C$211,950. Of this total, $67,331 was spent on field geological reconnaissance, grab sampling and channel sampling at the Lac Orignal Deposit and surrounding areas in August 2022 and C$144,631 was spent on data interpretation and geological modelling of the Deposit from May to September 2022. These data gathering, interpretation and modelling exploration activities are described in more detail in Sections 7 and 11 of the Technical Report Summary, attached as Exhibit 17.1 to this Registration Statement.

Access

The Lac Orignal region is easily accessible from the City of Saguenay, 82 km south-southwest, by Highway 172 to logging road, chemin de la Zec Martin-Valin, which crosses the Property and is maintained year-round by logging companies (Figure 4.1). At km 81.5 on this road, a secondary logging trail goes northwest for 3.5 km to the Lac Orignal Deposit area. Many secondary logging roads can be utilized to access various parts of the Property.

The Property is located within the unorganized territory of Mont-Valin with a population of five people. A small inn, Auberge 31, at km 31 of the main logging road, can accommodate workers. There are several logging camps and outfitters along the road to the Property.

LAC ORIGNAL PROPERTY AREA ACCESS AND INFRASTRUCTURE SETTING

Mineral Resource Estimates

The Mineral Resource Estimate presented herein is reported in accordance with § 229.1302(d)(1)(iii)(A) (Item 1302(d)(1)(iii)(A) of Regulation S-K into Indicated and Inferred Mineral Resources and has been estimated in conformity with the generally accepted CIM “Estimation of Mineral Resource and Mineral Reserves Best Practices” guidelines (2019). Mineral Resources are not Mineral Reserves and do not have demonstrated economic viability. There is no guarantee that all or any part of the Mineral Resource will be converted to a Mineral Reserve. Confidence in the estimate of an Inferred Mineral Resource is insufficient to allow the meaningful application of technical and economic parameters or to enable an evaluation of economic viability worthy of public disclosure. Mineral Resources may be affected by further infill and exploration drilling that may result in increases or decreases in subsequent Mineral Resource Estimates.

This Mineral Resource Estimate was based on information and data supplied by First Phosphate Corp., and was undertaken by Yungang Wu, P.Geo., and Eugene Puritch, P.Eng., FEC, CET of P&E Mining Consultants Inc. of Brampton, Ontario. This Mineral Resource Estimate was supervised, reviewed and accepted by Antoine Yassa, P.Geo., an independent Qualified Person in terms of NI 43-101. Messrs Wu, Puritch and Yassa are considered to be the “Authors” of this section taken from the Technical Report Summary attached as Exhibit 17.1 to this Registration Statement. The effective date of the Mineral Resource Estimate is October 3, 2022.

All drilling/channel and assay data were provided in the form of Excel data files by First Phosphate Corp. The GEOVIA GEMS™ V6.8.4 database for this Mineral Resource Estimate, compiled by the Authors, consisted of 63 drill holes and 17 surface channel samples totalling 7,984 m and 149.5 m respectively. A total of 49 drill holes (6,393 m) and five channel samples (27 m) intersected the mineralization wireframes used for the Mineral Resource Estimate. Six drill holes in the database completed more than 3-km north of the Mineral Resource area were not utilized in this Mineral Resource Estimate. A drill hole plan is shown in Appendix A of the Technical Report Summary attached as Exhibit 17.1 in this Registration Statement.

The drill hole and channel sample database contained P₂O₅, Fe₂O₃ and TiO₂ assays. The basic statistics for all raw assays in the Mineral Resource Estimate area are presented in the Table below.

All drill hole survey and assay values are expressed in metric units. The coordinates are in the UTM system NAD 83, Zone 19N.

Mineral Resource database checks were completed according to the verification procedures and protocols described in Sections 8 and 8 of the Technical Report Summary attached as Exhibit 17.1 to this Registration Statement. The Authors are of the opinion that the supplied database is suitable for Mineral Resource estimation.

The Lac Orignal Deposit mineralized wireframe boundaries were determined from lithology, structure, and grade boundary interpretation from visual inspection of drill hole cross-sections. Three mineralized wireframes were developed and referred to as Main, HW (hanging wall) and FW (footwall) Zones. The mineralized wireframes were constructed on 100 m spaced vertical cross-sections with computer screen digitizing polylines on drill hole cross-sections in GEMS^™ by the Authors. The mineralized wireframe outlines were influenced by the selection of mineralized material above 2.5% P₂O₅ that demonstrated a lithological and structural zonal continuity along strike and down-dip. In some cases, mineralization <2.5% P₂O₅ was included for the purpose of maintaining zone continuity. On each cross-section, polyline interpretations were digitized from drill hole to drill hole, but not typically extended more than 100 m into untested territory. Minimum constrained width for interpretation was 3 m of drill core length.

The resulting Main Mineral Resource mineralized wireframe is 2,230 m long, 50 m to 445 m thick (true thickness is 2.97 m to 99.5 m), strikes east-west, and dips 25° to 30° north. The mineralized wireframes were utilized as constraining boundaries during Mineral Resource estimation for purposes of rock coding, statistical analysis and compositing limits. The 3-D mineralized wireframes are presented in Appendix B of the Technical Report Summary attached as Exhibit 17.1 to this Registration Statement.

The topographic and overburden surfaces were created using LiDAR results from the Québec government website (www.diffusion.mffp.gouv.qc.ca) and drill hole logs. All mineralized wireframes were truncated at the top of bedrock surface.

A unique rock code was assigned to each mineralized wireframe in the Mineral Resource model as presented in the Table below.

Mineralized wireframe constrained assays were back coded in the assay database with rock codes that were derived from intersections of the mineralized wireframes and drill holes. The basic statistics of the mineralized wireframe constrained assays are presented in the Table below.

In order to regularize the assay sampling intervals for grade interpolation, a 1.5 m compositing length was selected for the drill hole/channel sample intervals that fell within the constraints of the above-described Mineral Resource mineralized wireframes. The composites were calculated for P₂O₅, Fe₂O₃ and TiO₂ over 1.5 m lengths starting at the first point of intersection between the assay data drill hole/channel sample and the hanging wall of the 3-D mineralized wireframe constraint. The compositing process was halted on exit from the footwall of the mineralized wireframe constraint. Explicit missing samples (intervals without results like lost core or poor recovery) were treated as nulls based on the nature of mineralization, whereas implicit missing samples (unsampled intervals) were assigned a background value of 0.01%. If the last composite interval was <0.50 m, the composite length was adjusted to make all composite intervals of the mineralized wireframe intercept equal. The resulting composite length ranged from 1.44 m to 1.52 m.
This process would not introduce any short sample bias into the grade interpolation process. The constrained composite data were extracted to a point file for a grade capping analysis. The composite statistics are summarized in the Table below.

Note: P₂O₅ - phosphorus pentoxide, Fe₂O₃ = iron oxide, TiO₂ = titanium dioxide, Comp = composite, Cap = capped composite.

Grade capping was investigated on the 1.5 m composite values in the database within the constraining mineralized wireframes to ensure that the possible influence of erratic high-grade values did not bias the database and subsequent grade interpolation. Log-normal histograms and log-probability plots were generated for each mineralized wireframe and the resulting selected graphs are exhibited in Appendix C. The capped composite statistics are summarized in Table 11.4. The grade capping values are detailed in the Table below. The capped composites were utilized to develop variograms and for block model grade interpolation.

A variography analysis was attempted as a guide to determining a grade interpolation search strategy. Directional variograms were developed using the P₂O₅ composites for the Main wireframe. Selected variograms are presented in Appendix D.

Continuity ellipses based on the observed ranges were subsequently generated and utilized as the basis for grade estimation search ranges, distance weighting calculations and Mineral Resource classification criteria.

The bulk density data used for the creation of the bulk density block model was derived from nine samples taken by the Authors that were analyzed by Activation Laboratories on Ancaster, ON. The average bulk density was 3.04 t/m³.

The Lac Orignal block model was constructed using GEOVIA GEMS™ V6.8.4 modelling software. The block model origin and block size are presented in Table 11.6. The block model consists of separate model attributes for estimated P₂O₅, Fe₂O₃ and TiO₂ grade, rock type (mineralized wireframes), volume percent, bulk density, and classification.

All blocks in the rock type block model were initialled with a waste rock code of 99, corresponding to the surrounding country rocks. The mineralized wireframes were used to code all blocks within the rock type block model that contain ≥1% volume within the mineralized wireframe. These blocks were assigned the rock type codes presented in Table 14.2. The overburden and topographic surfaces were subsequently utilized to assign rock codes 10 and 0, corresponding overburden and air respectively, to all blocks ≥50% above those surfaces.

A volume percent block model was set up to accurately represent the volume and subsequent tonnage that was occupied by each block inside the constraining mineralized wireframes. As a result, the mineralized wireframe boundary was properly represented by the volume percent model ability to measure individual infinitely variable block inclusion percentages within that mineralized wireframe. The minimum percentage of the mineralized block was set to 1%.

The P₂O₅, Fe₂O₃ and TiO₂ grade blocks were interpolated with Inverse Distance Squared (“ID²”). Nearest Neighbour (“NN”) was utilized for validation. Multiple passes were executed for the grade interpolation to progressively capture the sample points to avoid over-smoothing and preserve local grade variability. Search ranges and directions were based on the variograms. Grade blocks were interpolated using the parameters in the Table below.

Selected cross-sections and plans of the P₂O₅ grade blocks are presented in Appendix E of the Technical Report Summary attached as Exhibit 17.1 in this Registration Statement.

The average bulk density of 3.04 t/m³ was applied to the interpolated grade blocks.

It is the Author’s opinion that the drilling, assaying and exploration work on the Lac Orignal Project support this Mineral Resource Estimate and are sufficient to indicate a reasonable potential for economic extraction, and thus it is qualified as a Mineral Resource in accordance with § 229.1302(d)(1)(iii)(A) (Item 1302(d)(1)(iii)(A) of Regulation S-K into Indicated and Inferred Mineral Resources. . The Mineral Resource is classified as Indicated and Inferred, based on the geological interpretation, variogram performance and drill hole spacing. The Indicated Mineral Resource is classified for the blocks interpolated with the Pass I and II, which used at least four composites from a minimum of two holes; and Inferred Mineral Resource is classified for all remaining grade populated blocks within the mineralized wireframes. The classifications were adjusted manually to reasonably reflect the distribution of each classification. Selected classification block cross-sections and plans are attached in Appendix F of the Technical Report Summary attached as Exhibit 17.1 in this Registration Statement.

The Lac Orignal Mineral Resource Estimate was derived from applying P₂O₅ percent cut-off values to the block models and reporting the resulting tonnes and grades for potentially mineable areas. The following parameters were used to calculate the cut-off value that determines the open pit mining potentially economic portions of the constrained mineralization. An optimized pit shell is presented in Appendix G of the Technical Report Summary attached as Exhibit 17.1 in this Registration Statement.

The P₂O₅ Cut-off value is calculated with parameters below:

The P₂O₅ cut-off for potential open pit mining is calculated at = 2.5%.

The resulting pit-constrained Mineral Resource Estimate at the effective date of this Technical Report is tabulated in the Table below. The Authors are of the opinion that the mineralization of the Lac Orignal Project is potentially amenable to open pit economic extraction.

Note: P₂O₅ = phosphorus pentoxide, Fe₂O₃ = iron oxide, TiO₂ = titanium dioxide. 

1. Mineral Resources, which are not Mineral Reserves, do not have demonstrated economic viability. 

2. The estimate of Mineral Resources may be materially affected by environmental, permitting, legal, title, taxation, socio-political, marketing, or other relevant issues. 

3. The Inferred Mineral Resource in this estimate has a lower level of confidence than that applied to an Indicated Mineral Resource and must not be converted to a Mineral Reserve. It is reasonably expected that the majority of the Inferred Mineral Resource could be upgraded to an Indicated Mineral Resource with continued exploration. 

4. The Mineral Resources in this Technical Report were estimated using the Canadian Institute of Mining, Metallurgy and Petroleum (CIM), CIM Standards on Mineral Resources and Reserves, Definitions (2014) and Best Practices Guidelines (2019) prepared by the CIM Standing Committee on Reserve Definitions and adopted by the CIM Council.

The optimized pit-constrained Mineral Resource Estimate is sensitive to the selection of a reporting P₂O₅ cut-off value and are demonstrated in the Table below.

Note: P₂O₅ = phosphorus pentoxide, Fe₂O₃ = iron oxide, TiO₂ = titanium dioxide.

The block model was validated using a number of industry standard methods, including visual and statistical methods, as follows:

Notes: P₂O₅ = phosphorus pentoxide. 

ID² = block model grades were interpolated using Inverse Distance Squared

NN= block model grades were interpolated using Nearest Neighbour.

The comparisons above show the average grades of P₂O₅ block models were slightly lower than that of composites used for the grade estimation. These were most likely due to the smoothing by the grade interpolation process. The block model values will be more representative than the composites, due to 3-D spatial distribution characteristics of the block model.

Grade-Tonnage Curve of Main Wireframe ID² Versus NN Interpolation

Main Wireframe P₂O₅ Grade Swath Plot Easting

Main Wireframe P₂O₅ Grade Swath Plot Northing

Main Wireframe P₂O₅ Grade Swath Plot Elevation

Environmental and Permitting

The Lac Orignal Project will be developed with the consideration of the highest environmental, social and governance (“ESG”) principles. The application of these principles is anticipated to provide support for environmental assessment, permitting, and social acceptance.

A detailed Environmental Impact Assessment (“EIA”) of the Project will be required. A preamble for the EIA will be extensive baseline studies, including several biological and physical components, species at risk, migratory birds, greenhouse gas (“GHG”) emissions and control, current land use, archeological, etc.

Avoidance of encroachment on lakes, streams and fish habitat will be important. In accordance of Directive 019 of the Ministère du Dévelopment Durable, de l’Environnement, de la Faune et des Parcs (“MDDEFP”), it is anticipated that Project waste material, including waste rock and tailings will be classified as low risk. No significant concentrations of elements of environment and health concerns (i.e., As, Pb, Cd, Hg, U) have been found in drill core from the Lac Orignal Phosphate Deposit. Although the Deposit contains a small amount of iron sulphide, there appears to be adequate alkalinity in the rock to prevent metal leaching (“ML”) and acid rock drainage (“ARD”).

An EIA (prepared in French and in English), which will contain a detailed Project description, will be filed with the MDDEFP. Normally, questions and clarification are required by MDDEFP. When this process is completed, the Project would progress to public hearings under Bureau d’Audiences Publiques sur l’Environnement (“BAPE”). Successful BAPE hearings would be followed by Ministerial Approval of the Project.

A series of Provincial Permits and Compliances will be required with reference to:

A costed and funded closure and reclamation plan with an associated monitoring proposal will also be required.

It is anticipated that a federal environmental assessment process will not be triggered by the Project. Considerations of the non-metallic nature of the Deposit, absence of toxic substances, non-application of Metal Mining Effluent Regulations (“MMER”), and avoidance of fish habitat disturbance, would confirm avoidance of Canadian Environmental Assessment Act (“CEAA”) 2012 and 2021 revisions. Federal permits are required for the application and use of explosives, port management of fuels, and marine shipping of products.

Consultations and information sessions will be needed with First Nations and the local communities, during Project development. The Lac Orignal Deposit is located within the ancestral territory (Nitassinan) of the Betsiamites Innu Nation. Access from and product transport route to the Saguenay area port would take place in the Nitassinan of the Mashteuiatsh Pessamit and Essipit. Consultations have been initiated with these First Nations.

Significant consultations and Project information will also need to be exchanged with the communities of Dolbeau-Mistassini, Alma, and Saguenay-Lac St Jean. The transportation of concentrate to a Saguenay port, as much as 1,500 tpd, may emerge as a concern.

The main objectives of consultation and communication activity will be to:

Information sharing and consultation activities will continue throughout the Project development and permitting processes and the construction, operation and closure phases.

The completion of baseline studies, environmental assessment, and permitting can be anticipated to exceed approximately two years, and possibly more s of the date of this Registration Statement.

No significant environmental or health risks are anticipated to emerge from the considerations of mining and processing the Project’s mineralized material and concentrate transport from mine to port. Potential concerns that may arise from frequent trucks passing by communities, may be overcome or reduced by special truck designs, time and frequency of trucks passing, and the selection of Saguenay Port location.

Minimal environmental or permitting restrictions for the development and operation of the Project are anticipated.

Non-Material Properties

Begin - Lamarche

Description

The Company’s secondary exploration property is found at Bégin-Lamarche which is 75 km driving distance from the deep sea Port of Saguenay. On June 5, 2023, the Company announced the results of its 4,274 m drill program on the property which yielded the discovery of two main zones with multiple open pit accessible phosphate-bearing layers. Management has decided on a second drill program to be planned for the Bégin-Lamarche property. The objective of this program will be to infill drill the known phosphate layers to a 100 x 100 m grid in order to decide whether to commission an NI 43-101 resource estimate. The next drill program at Bégin-Lamarche is scheduled for Q1-Q2 of 2024 and requires a prospection program and minimum drilling program of 1500 m.

Updates

The Company incurred $550,752 in mining & metallurgy expenses in this area in the fiscal year ended February 28, 2023. To continue to advance the property, the Company has forecasted that it would need to incur an additional $330,000 to complete its additional drill program in the Begin - Lamarche Area which is anticipated to be completed by Q4 2024.

On July 27, 2022, the Company originally purchased 24 mining claims in this region of the Province of Quebec for a total consideration of $222,500 which comprised of $12,500 settled by issuing 50,000 shares at $0.25 per share and $210,000 in cash (the “Begin-Lamarche Agreement”). Further, the Company has paid $41,700 in cash for claim staking in the year ended February 28, 2023 to expand the area of the property.

On March 10, 2023, the Company issued 27,173 common shares with a fair value of $22,825 for the purchase of 13 mineral claims in the Begin-Lamarche area.

Between the fiscal year ended February 28, 2023 and the quarter ended May 31, 2023, expenditures on the Bégin-Lamarche property amounted to $550,481 and between the quarter ended May 31, 2023 and the quarter ended August 31, 2023, expenditures on the Bégin-Lamarche property amounted to $25,757. Immediate expenditures for this property will be on prospecting, assaying and drill program planning. The data obtained from these prospection activities will enable management to set the targets for the infill and drilling to occur in the next phase of development of the property. 

Bluesky

Description

The Bluesky properties consist of a series of staked claims areas within 250 km or less from the Port of Saguenay, Quebec. Ongoing surface sampling, prospecting and other forms of reconnaissance will occur on these properties in the future. These properties are to be considered as very early exploration.

Updates

On September 12, 2022, pursuant to an agreement between the Company and Frederic Bergeron (the “Bluesky Agreement”), the Company purchased 23 mining claims in this region of the Province of Quebec for total consideration of $50,000 which comprised of $40,000 settled by issuing 160,000 Common Shares at $0.25 per share and $10,000 in cash. Further, the Company has paid $59,325 in cash for claim staking in the year ended February 28, 2023 to expand Bluesky areas.

The Company incurred nil in mining & metallurgy expenses in this area in the fiscal year ended February 28, 2023.

Between the quarter ended May 31, 2023 and the quarter ended August 31, 2023, expenditures on the Bluesky properties amounted to $10,495.

All three exploration areas noted above have not generated revenue thus far. The Company is in the exploration phase at Lac à l’Orignal, in the advanced drilling phase at Bégin-Lamarche and at the early exploration phase in the Bluesky Property. The Company continues to determine the commercial feasibility of each location.

Not applicable.

The following discussion of our financial condition, changes in financial conditions and results of operations for the years ended February 28, 2023, 2022 and 2021 should be read in conjunction with our financial statements and related notes included therein included in this registration statement at Item 18. Our financial statements have been prepared in accordance with IFRS as issued by the IASB.

The following discussion contains forward-looking statements that involve inherent risks and uncertainties. Actual results may differ materially from those contained in such forward-looking statements. See the “Cautionary Note Regarding Forward-Looking Statements” at the beginning of this document.

Significant Events

Officers of the Company were issued 718,947 Common Shares for settlement of all amounts owed to them as of August 31, 2023. Several vendors and consultants of the Company were issued 570,200 Common Shares for settlement of all amounts owed to them as of August 31, 2023.

On September 13, 2023, the Company entered into an agreement with ABF of Utah, USA, pursuant to a memorandum of understanding, to support production of up to 40,000 tonnes of annual fully North American manufactured LFP CAM. The initiative aims to bring production of LFP Batteries for the battery storage sector to North America.

On September 26, 2023, we received a letter of interest from EXIM, where EXIM expressed that it would be able to provide us with financing in the amount of up to USD$170,000,000. The letter of intent is in support of the procurement of U.S. goods and services by First Phosphate in Canada and is eligible for a maximum repayment term of 10 years and expires on October 14, 2024.

Results of Operations

The following is a discussion of the Group’s results of operations for the six months ended August 31, 2023 and the year ended February 28, 2023. The following provides the reader with information that will assist in understanding our audited financial statements, the changes in certain key items in those audited financial statements from year to year, and the primary factors that accounted for those changes, as well as how certain accounting principles affect our audited financial statements.

The information should be read in conjunction with the Company’s condensed interim financial statements for the six months ended August 31, 2023 and August 31, 2022 and the accompanying notes thereto.

The information should be read in conjunction with the Company’s audited financial statements for the years ended February 28, 2023, 2022 and 2021 and the accompanying notes thereto.

Total Expenses

The Company’s total expenses amounted to $3,696,674 for the six months ended August 31, 2023 and $3,270,008 for the year ended February 28, 2023, and consisted primarily of the following:

Foreign Currency Fluctuations

We report our financial results and maintains our accounts in Canadian dollars. Our operations in Canada make us subject to foreign currency fluctuations and such fluctuations may materially affect our financial position and results of operations. We have not hedged our exposure to currency fluctuations.

Governmental Regulations, Laws, and Local Practices

Please see the discussion of governmental regulations, laws and local practices in Canada in Item 3.D “Risk Factors”.