American Lithium Corp 40-F/A for FY2023
American Lithium Corp. (AMLIF)
About this 40-F/A
American Lithium Corp filed this 40-F/A on June 30, 2023, covering the fiscal year ended February 28, 2023 (FY2023).
Headline figures
Fiscal year ended February 28, 2023, as reported in this filing, compared with the same period a year earlier where the filing states it.
- Net loss
- 35.67M CAD
- compared with a net loss of 23.55M CAD a year earlier
- Diluted EPS
- -0.17 CAD
- compared with -0.13 CAD a year earlier
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
___________________
Amendment No. 1
to
FORM 40-F
___________________
| Registration statement pursuant to section 12 of the Securities Exchange Act of 1934 |
| Annual report pursuant to section 13(a) or 15(d) of the securities exchange act of 1934 |
For the fiscal year ended
Commission File Number
___________________
(Exact name of Registrant as specified in its charter)
| British
Columbia | 1000 | Not Applicable | ||
| (Province or other jurisdiction of incorporation or organization) | (Primary Standard Industrial Classification Code Number) | (I.R.S. Employer Identification No.) |
___________________
(Address and telephone number of Registrant's principal executive offices)
___________________
(Name, address (including zip code) and telephone number (including area code) of agent for service in the United States)
___________________
Securities registered or to be registered pursuant to Section 12(b) of the Act:
| Title of each class | Trading Symbol(s) | Name of each exchange on which registered | ||
Securities registered or to be registered pursuant to Section 12(g) of the Act: None
Securities for which there is a reporting obligation pursuant to Section 15(d) of the Act: None
For annual reports, indicate by check mark the information filed with this form:
Number of outstanding shares of each of the issuer’s classes of capital or common stock as of February 28, 2023: Common Shares, no par value.
Indicate by check mark whether the Registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Exchange Act during the preceding 12 months (or for such shorter period that the Registrant was required to file such reports) and (2) has been subject to such filing requirements for the past 90 days.
| No ☐ |
Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted 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 such files).
| No ☐ |
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 12b-2 of the Exchange Act.
Emerging Growth Company
If an emerging growth company that prepares
its financial statements in accordance with U.S. GAAP, indicate by check mark if the registrant has elected not to use the extended transition
period for complying with any new or revised financial accounting standards† provided pursuant to Section 13(a) of the Exchange
Act.
† The term “new or revised financial accounting standard” refers to any update issued by the Financial Accounting Standards Board to its Accounting Standards Codification after April 5, 2012.
Indicate by check mark whether the registrant has filed a report on and attestation to its management’s assessment of the effectiveness of its internal control over financial reporting under Section 404(b) of the Sarbanes-Oxley Act (15 U.S.C. 7262(b)) by the registered public accounting firm that prepared or issued its audit report. ☐
If securities are registered pursuant to Section 12(b) of the Act, indicate by check mark whether the financial statements of the registrant included in the filing reflect the correction of an error to previously issued financial statements.1 ☐
Indicate by check mark whether any
of those error corrections are restatements that required a recovery analysis of incentive-based compensation received by any of the
registrant’s executive officers during the relevant recovery period pursuant to §240.10D-(b).2
☐
| Auditor Name: |
Auditor Location: |
Firm ID: |
_________________
1 Check boxes are blank, pending adoption of the underlying rules.
2 Check boxes are blank, pending adoption of the underlying rules.
EXPLANATORY NOTE
No other changes have been made to the Form 40-F other than the furnishing of the exhibit described above. This Form 40-F/A does not reflect subsequent events occurring after the original date of the Form 40-F, or modify or update in any way disclosures made in the Form 40-F.
Exhibit Index
*Previously Filed.
SIGNATURES
Pursuant to the requirements of the Exchange Act, the Registrant certifies that it meets all of the requirements for filing on Form 40-F and has duly caused this annual report to be signed on its behalf by the undersigned, thereto duly authorized.
| American Lithium Corp. | |
| By: /s/ Simon Clarke | |
| Name: Simon Clarke | |
| Title: Chief Executive Officer | |
| Date: June 29, 2023 |
Exhibit 99.2
Consolidated Financial Statements
For the years ended
(Expressed in Canadian Dollars)
American Lithium Corp.
Table of Contents
(Expressed in Canadian Dollars)
| 2 |
Report of Independent Registered Public Accounting Firm
To the Shareholders and the Board of Directors of American Lithium Corp.
Opinion on the Consolidated Financial Statements
We have audited the accompanying consolidated statements of financial position of American Lithium Corp. and subsidiaries (the "Company") as at February 28, 2023 and 2022, and the related consolidated statements of loss and comprehensive loss, changes in shareholders' equity and cash flows for the years then ended, and the related notes (collectively referred to as the "consolidated financial statements"). In our opinion, the consolidated financial statements present fairly, in all material respects, the financial position of the Company at February 28, 2023 and 2022, and the results of its operations and its cash flows for the years then ended, in accordance with International Financial Reporting Standards as issued by the International Accounting Standards Board.
Basis for Opinion
These consolidated financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on the Company's consolidated financial statements based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (the "PCAOB") and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.
We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the consolidated financial statements are free of material misstatement, whether due to error or fraud. The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. As part of our audits, we are required to obtain an understanding of internal control over financial reporting but not for the purpose of expressing an opinion on the effectiveness of the Company's internal control over financial reporting. Accordingly, we express no such opinion.
Our audits included performing procedures to assess the risks of material misstatement of the consolidated financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the consolidated financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the consolidated financial statements. We believe that our audits provide a reasonable basis for our opinion.
/s/
Chartered Professional Accountants
We have served as the Company's auditor since 2022.
May 29, 2023
| 3 |
American Lithium Corp.
(Expressed in Canadian Dollars)
Consolidated Statements of Financial Position
| February 28, | February 28, | |||||||||||
| Notes | 2023 | 2022 | ||||||||||
| $ | $ | |||||||||||
| ASSETS | ||||||||||||
| Current | ||||||||||||
| Cash and cash equivalents | 4 | |||||||||||
| Short-term investments | 5 | |||||||||||
| Amounts receivable | ||||||||||||
| Prepaid expenses and deposits | ||||||||||||
| Total Current Asset | ||||||||||||
| Non-current assets | ||||||||||||
| Deposits | ||||||||||||
| Property and equipment | 6 | |||||||||||
| Exploration and evaluation assets | 7 | |||||||||||
| Reclamation bonds | 8 | |||||||||||
| Right-of-use assets | 9 | |||||||||||
| Total Non-Current Asset | ||||||||||||
| LIABILITIES | ||||||||||||
| Current | ||||||||||||
| Accounts payable and accrued liabilities | 10,13 | |||||||||||
| Current portion of long-term debt | 11 | |||||||||||
| Current portion of lease liabilities | 9 | |||||||||||
| Total Current Liabilities | ||||||||||||
| Non-current assets | ||||||||||||
| Long-term debt | 11 | |||||||||||
| Lease liabilities | 9 | |||||||||||
| Total Non - Liabilities | ||||||||||||
| EQUITY | ||||||||||||
| Share capital | 12 | |||||||||||
| Equity reserves | 12 | |||||||||||
| Deficit | ( | ) | ( | ) | ||||||||
| Accumulated other comprehensive income | ( | ) | ||||||||||
| Total Stockholders' Equity | ||||||||||||
| Total Liabilities and Stockholders' Equity | ||||||||||||
Nature of operations (Note 1)
Subsequent events (Note 20)
Approved on behalf of the Board of Directors on May 29, 2023:
| /s/ Ben Binninger | /s/ Claudia Tornquist |
| Ben Binninger, Director | Claudia Tornquist, Director |
The accompanying notes form an integral part of these consolidated financial statements.
| 4 |
American Lithium Corp.
(Expressed in Canadian Dollars)
Consolidated Statements of Loss and Comprehensive Loss
| For the years ended February 28, |
||||||||||||
| Notes | 2023 | 2022 | ||||||||||
| $ | $ | |||||||||||
| Expenses | ||||||||||||
| Conferences and tradeshows | ||||||||||||
| Consultancy and employment costs | ||||||||||||
| Depreciation | 6,9 | |||||||||||
| Exploration and evaluation expenditures | 13 | |||||||||||
| Finance charge | 9,11 | |||||||||||
| Foreign exchange loss | ||||||||||||
| General and administrative | ||||||||||||
| Insurance | ||||||||||||
| Management and directors fees | 13 | |||||||||||
| Marketing | ||||||||||||
| Professional fees | ||||||||||||
| Regulatory and transfer agent fees | ||||||||||||
| Share-based compensation | 12,13 | |||||||||||
| Travel | ||||||||||||
| Total Expenses | ( | ) | ( | ) | ||||||||
| Other items | ||||||||||||
| Interest income | ||||||||||||
| Expense recovery | 18 | |||||||||||
| Net loss for the year | ( | ) | ( | ) | ||||||||
| Other comprehensive loss | ||||||||||||
| Foreign currency translation adjustment | ( | ) | ||||||||||
| Comprehensive loss for the year | ( | ) | ( | ) | ||||||||
| Basic and diluted loss per share | ) | ) | ||||||||||
| Weighted average number of common shares outstanding | ||||||||||||
The accompanying notes form an integral part of these consolidated financial statements.
| 5 |
American Lithium Corp.
(Expressed in Canadian Dollars)
Consolidated Statements of Cash Flows
| For the years ended February 28, |
||||||||
| 2023 | 2022 | |||||||
| $ | $ | |||||||
| Cash flows used in operating activities | ||||||||
| Net loss for the year | ( | ) | ( | ) | ||||
| Items not affecting cash and cash equivalents | ||||||||
| Depreciation | ||||||||
| Finance charge | ||||||||
| Share-based compensation | ||||||||
| Accrued interest receivable | ( | ) | ( | ) | ||||
| Changes in non-cash working capital items | ||||||||
| Amounts receivable | ( | ) | ||||||
| Prepaid expenses and deposits | ( | ) | ( | ) | ||||
| Accounts payable and accrued liabilities | ( | ) | ||||||
| Due to related parties | ( | ) | ||||||
| Cash used in operating activities | ( | ) | ( | ) | ||||
| Cash flows used in investing activities | ||||||||
| Cash acquired from acquisition | ||||||||
| Exploration and evaluation assets expenditures | ( | ) | ( | ) | ||||
| Redemption of short-term investments | ||||||||
| Purchase of short-term investments | ( | ) | ( | ) | ||||
| Purchase of equipment | ( | ) | ( | ) | ||||
| Purchase of reclamation bonds | ( | ) | ||||||
| Refund of reclamation bonds | ||||||||
| Cash paid for acquisition | ( | ) | ||||||
| Cash provided by investing activities | ( | ) | ||||||
| Cash flows from financing activities | ||||||||
| Proceeds from shares issuance | ||||||||
| Share issuance costs | ( | ) | ||||||
| Repayment of note payable | ( | ) | ||||||
| Stock options exercised | ||||||||
| Warrants exercised | ||||||||
| Repayment of long term debt | ( | ) | ( | ) | ||||
| Repayment of lease liabilities | ( | ) | ( | ) | ||||
| Cash provided by financing activities | ||||||||
| Effect of exchange rate changes on cash and cash equivalents | ( | ) | ||||||
| Change in cash and cash equivalents during the year | ( | ) | ||||||
| Cash and cash equivalents, beginning of year | ||||||||
| Cash and cash equivalents, end of year | ||||||||
Supplementary cash flow disclosures (Note 17)
The accompanying notes form an integral part of these consolidated financial statements.
| 6 |
American Lithium Corp.
(Expressed in Canadian Dollars)
Consolidated Statements of Changes in Shareholders’ Equity
| Reserves | ||||||||||||||||||||||||||||||||||||
| Number of Shares |
Share Capital |
Warrants | Share Options |
RSU | Total | Deficit | Accumulated Other Comprehensive Income (Loss) | Total | ||||||||||||||||||||||||||||
| $ | $ | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||
| Balance at February 28, 2021 | ( | ) | ||||||||||||||||||||||||||||||||||
| Units issued for acquisition | ||||||||||||||||||||||||||||||||||||
| Plateau warrants assumed | - | |||||||||||||||||||||||||||||||||||
| Replacement of options issued | - | |||||||||||||||||||||||||||||||||||
| Finders' shares issued for acquisition | ||||||||||||||||||||||||||||||||||||
| Share and warrants issued for exploration and evaluation assets | ||||||||||||||||||||||||||||||||||||
| Private placement | ||||||||||||||||||||||||||||||||||||
| Share issue costs | - | ( | ) | ( | ) | |||||||||||||||||||||||||||||||
| Share-based compensation | - | |||||||||||||||||||||||||||||||||||
| Stock options exercised | ( | ) | ( | ) | ||||||||||||||||||||||||||||||||
| Stock options cancelled | - | ( | ) | ( | ) | |||||||||||||||||||||||||||||||
| Warrants exercised | ( | ) | ( | ) | ||||||||||||||||||||||||||||||||
| Warrants expired | - | ( | ) | ( | ) | |||||||||||||||||||||||||||||||
| Loss for the year | - | ( | ) | ( | ) | |||||||||||||||||||||||||||||||
| Foreign currency translation adjustment | - | ( | ) | ( | ) | |||||||||||||||||||||||||||||||
| Balance at February 28, 2022 | ( | ) | ( | ) | ||||||||||||||||||||||||||||||||
| Share issued for exploration and evaluation assets | ||||||||||||||||||||||||||||||||||||
| Share-based compensation | - | |||||||||||||||||||||||||||||||||||
| Stock options exercised | ( | ) | ( | ) | ||||||||||||||||||||||||||||||||
| Stock options cancelled | - | ( | ) | ( | ) | |||||||||||||||||||||||||||||||
| Warrants exercised | ( | ) | ( | ) | ||||||||||||||||||||||||||||||||
| Loss for the year | - | ( | ) | ( | ) | |||||||||||||||||||||||||||||||
| Foreign currency translation adjustment | - | |||||||||||||||||||||||||||||||||||
| Balance at February 28, 2023 | ( | ) | ||||||||||||||||||||||||||||||||||
The accompanying notes form an integral part of these consolidated financial statements.
| 7 |
American Lithium Corp.
Notes to Consolidated Financial Statements
For the years ended February 28, 2023 and 2022
(Expressed in Canadian Dollars)
| 1. | NATURE OF OPERATIONS |
American Lithium Corp. (the “Company”) is incorporated in the Province of British Columbia. The Company is engaged in the business of identification, acquisition, and exploration of mineral interests. The Company’s head office is located at 710 – 1030 West Georgia Street, Vancouver, British Columbia, V6E 2Y3, Canada, and its registered and records office is located at Suite 2200, 885 West Georgia Street, Vancouver, BC, V6C 3E8, Canada. The Company’s common shares are listed for trading on Tier 2 of the TSX Venture Exchange (the “Exchange”) under the symbol “LI”, the Frankfurt Stock Exchange under the symbol “5LA”, and, effective January 10, 2023, the NASDAQ exchange under the symbol “AMLI”.
The Company had a working capital position of $
As at February 28, 2023, the Company was in the process of exploring its principal mineral properties and has not yet determined whether the properties contain ore reserves that are economically recoverable. The recoverability of amounts shown as exploration and evaluation assets is dependent upon the discovery of economically recoverable reserves, the confirmation of the Company’s interest in the underlying mineral claims, the ability of the Company to obtain necessary financing to complete the development and upon future profitable production or proceeds from the disposition thereof.
The Company incurred a net loss $
| 2. | BASIS OF PRESENTATION |
Statement of compliance
These consolidated financial statements, including comparatives, have been prepared in accordance with International Accounting Standards (“IFRS”) as issued by the International Accounting Standards Board (“IASB”).
The preparation of consolidated financial statements requires management to make judgments, estimates and assumptions that affect the application of policies and reported amounts of assets and liabilities, profit and expenses. The estimates and associated assumptions are based on historical experience and various other factors that are believed to be reasonable under the circumstances, the results of which form the basis for making the judgments about carrying values of assets and liabilities that are not readily apparent from other sources. Actual results may differ from these estimates.
| 8 |
American Lithium Corp.
Notes to Consolidated Financial Statements
For the years ended February 28, 2023 and 2022
(Expressed in Canadian Dollars)
| 2. | BASIS OF PRESENTATION (continued) |
Statement of compliance (continued)
The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognized in the period in which the estimate is revised if the revision affects only that period or in the period of the revision and further periods if the review affects both current and future periods. Estimates with a significant risk of material adjustment are discussed in Note 3.
Certain accounts have been reclassified to be consistent with the current period classification.
These consolidated financial statements were approved and authorized for issue by the Board of Directors on May 29, 2023.
Principles of consolidation
The consolidated financial statements include the accounts of the Company and the following subsidiaries:
| Schedule of subsidiaries | |
| Name | Jurisdiction |
All intercompany transactions, balances, revenue and expenses are eliminated on consolidation. During the year ended February 28, 2023, the Company amalgamated 1032701 Nevada Ltd., 1065604 Nevada Ltd., 1067323 Nevada Ltd., 1134989 Nevada Ltd., 1301420 Nevada Ltd., and 4286128 Nevada Corp. as one company under Tonopah Lithium Corp. In addition, the Company amalgamated Big Smoky Holdings Corp. as one company under American Lithium Holdings Corp. On January 24, 2023, the Company acquired 100% of the outstanding shares of Maran (Note 7).
Subsidiaries
Subsidiaries are all entities over which the Company has exposure to variable returns from its involvement and has the ability to use power over the investee to affect its returns. The existence and effect of potential voting rights that are currently exercisable or convertible are considered when assessing whether the Company controls another entity. Subsidiaries are fully consolidated from the date on which control is transferred to the Company until the date on which control ceases.
| 9 |
American Lithium Corp.
Notes to Consolidated Financial Statements
For the years ended February 28, 2023 and 2022
(Expressed in Canadian Dollars)
| 3. | SIGNIFICANT ACCOUNTING POLICIES |
Significant accounting judgments, estimates and assumptions
The preparation of the Company’s consolidated financial statements in conformity with IFRS requires management to make judgments, estimates and assumptions that affect the application of accounting policies and the reported amounts of assets, liabilities, and contingent liabilities as at the date of the consolidated financial statements and the reported amounts of expenses during the reporting period. Estimates and assumptions are continuously evaluated and are based on management’s experience and other factors, including expectations of future events that are believed to be reasonable under the circumstances. However, actual outcomes can differ from these estimates. Revisions to accounting estimates are recognized in the period in which the estimates are revised and in any future periods affected. The more significant areas of judgement and estimation are as follows:
| · | the estimates and assumptions used in the determination of the measurement of the share-based payments. |
Functional currency
The reporting and functional currency of the Company and its subsidiaries is the Canadian dollar, except for Macusani where the functional currency is the US dollar.
Transactions in currencies other than an entity’s functional currency are recorded at the rates of exchange prevailing at the dates of the transactions. Monetary assets and liabilities denominated in foreign currencies are translated at period-end rates. Non-monetary assets and liabilities are translated at historical rates. Income and expenses are translated at average rates in effect during the period except for depreciation, which is translated at historical rates. The resulting gains or losses are reflected in profit or loss in the period of translation. Where applicable, the functional currency is translated into the presentation currency using the period end rates for assets and liabilities, while the operations and cash flows are translated using average rates of exchange and the exchange differences arising on translation are recognized in other comprehensive loss. The Company treats specific intercompany balances, which are not intended to be repaid in the foreseeable future, as part of its net investment, whereby the exchange difference on translation is recorded in other comprehensive loss.
Cash and cash equivalents
Cash and cash equivalents in the statement of financial position comprise cash at banks and highly liquid investments in the form of money market investments and certificates of deposit with investment terms that allow for penalty free redemption after one month or less and are readily convertible to a known amount of cash and subject to an insignificant risk of change in value.
Exploration and evaluation assets
Exploration and evaluation costs are expensed as incurred. Costs directly related to the acquisition are capitalized once the legal rights to explore the exploration and evaluation assets are acquired or obtained. When the technical and commercial viability of a mineral resource has been demonstrated and a development decision has been made, the capitalized costs of the related property are first tested for impairment, then transferred to mining assets and depreciated using the units of production method on commencement of commercial production.
Management reviews the carrying value of capitalized exploration and evaluation assets at least annually. The review is based on the Company’s intentions for development of an undeveloped property. If a project does not prove viable, all unrecoverable costs associated with the project net of any previous impairment provisions are written off.
| 10 |
American Lithium Corp.
Notes to Consolidated Financial Statements
For the years ended February 28, 2023 and 2022
(Expressed in Canadian Dollars)
| 3. | SIGNIFICANT ACCOUNTING POLICIES (continued) |
Exploration and evaluation assets (continued)
Title to exploration and evaluation assets involves certain inherent risks due to the difficulties of determining the validity of certain claims as well as the potential for problems arising from the frequently ambiguous conveyancing history characteristic of many exploration and evaluation assets. The Company has investigated title to all of its exploration and evaluation assets and, to the best of its knowledge, title to all of its properties are in good standing.
Impairment
The Company assesses, at each reporting date, whether there is an indication that an asset may be impaired.
If any indication exists, or when annual impairment testing for an asset is required, the Company estimates the asset’s recoverable amount. An asset’s recoverable amount is the higher of an asset’s fair value less costs of disposal and its value in use. The recoverable amount is determined for an individual asset, unless the asset does not generate cash inflows that are largely independent of those from other assets or groups of assets in which case the recoverable amount is determined for the cash generating unit (“CGU”) to which the asset belongs. When the carrying amount of an asset or CGU exceeds its recoverable amount, the asset is considered impaired and its carrying amount or that of the CGU is written down to its recoverable amount and the impairment loss is recognized in the consolidated statement of loss and comprehensive loss.
In assessing value in use, the estimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects current market assessments of the time value of money and the risks specific to the asset. In determining fair value less costs of disposal, recent market transactions are taken into account. If no such transactions can be identified, an appropriate valuation model is used. These calculations are corroborated by valuation multiples, quoted share prices for publicly traded companies or other available fair value indicators.
An assessment is made at each reporting date to determine whether there is an indication that previously recognised impairment losses no longer exist or have decreased. If such indication exists, the Company estimates the asset’s or CGU’s recoverable amount. A previously recognised impairment loss is reversed only if there has been a change in the assumptions used to determine the asset’s recoverable amount since the last impairment loss was recognised. The reversal is limited so that the carrying amount of the asset does not exceed its recoverable amount, nor exceed the carrying amount that would have been determined, net of depreciation, had no impairment loss been recognised for the asset in prior years. Such reversal is recognised in the consolidated statement of loss and comprehensive loss.
| 11 |
American Lithium Corp.
Notes to Consolidated Financial Statements
For the years ended February 28, 2023 and 2022
(Expressed in Canadian Dollars)
| 3. | SIGNIFICANT ACCOUNTING POLICIES (continued) |
Decommissioning liabilities
A legal or constructive obligation to incur restoration, rehabilitation
and environmental costs may arise when environmental disturbance is caused by the Company’s exploration and evaluation activities.
Discount rates using a pre-tax rate that reflects the risk and the time value of money are used to calculate the net present value. These
costs are charged against profit or loss as exploration and evaluation expenditures and the related liability is adjusted for each period
for the unwinding of the discount rate and for changes to the current market-based discount rate, amount or timing of the underlying cash
flows needed to settle the obligation. The Company has
Provisions
Provisions are recorded when a present legal or constructive obligation exists as a result of past events where it is probable that an outflow of resources embodying economic benefits will be required to settle the obligation, and a reliable estimate of the amount of the obligation can be made.
The amount recognized as a provision is the best estimate of the consideration required to settle the present obligation at the statement of financial position date, taking into account the risks and uncertainties surrounding the obligation. Where a provision is measured using the cash flows estimated to settle the present obligation, its carrying amount is the present value of those cash flows. When some or all of the economic benefits required to settle a provision are expected to be recovered from a third party, the receivable is recognized as an asset if it is virtually certain that reimbursement will be received and the amount receivable can be measured reliably.
The Company grants stock options to buy common shares of the Company to directors, officers, employees and consultants. An individual is classified as an employee when the individual is an employee for legal or tax purposes, or provides services similar to those performed by an employee. The fair value of stock options is measured on the date of grant, using the Black-Scholes option pricing model, and is recognized over the vesting period. Consideration paid for the shares on the exercise of stock options is credited to share capital. When vested options are forfeited or are not exercised at the expiry date, the amount previously recognized is transferred to deficit.
In situations where equity instruments are issued to non-employees and some or all of the goods or services received by the entity as consideration cannot be specifically identified, they are measured at the fair value of the share-based payment.
The Company grants restricted share units (“RSUs”) to directors, officers, and employees. RSUs are redeemable on the vesting date, at the Company’s discretion, into an equal number of common shares of the Company or into cash. The amount of cash is determined based on the prevailing market prices at the vesting date.
Warrants issued in equity financing transactions
Equity financing transactions may involve issuance of common shares or units. A unit comprises a certain number of common shares and a certain number of share purchase warrants. Warrants that are part of units are assigned value based on the residual value method and included in the share warrant reserve. Warrants that are issued as payment for an agency fee or other transactions costs are accounted for as share-based payments. When warrants are cancelled or are not exercised at the expiry date, the amount previously recognized is transferred to deficit.
| 12 |
American Lithium Corp.
Notes to Consolidated Financial Statements
For the years ended February 28, 2023 and 2022
(Expressed in Canadian Dollars)
| 3. | SIGNIFICANT ACCOUNTING POLICIES (continued) |
The Company uses the treasury stock method in computing loss per share. Under this method, basic loss per share is computed by dividing losses available to common shareholders by the weighted average number of common shares outstanding during the year. For all periods presented the outstanding warrants, options, and RSUs are anti-dilutive. Accordingly, diluted loss per share information has not been shown.
Financial instruments
Financial assets
On initial recognition, financial assets are recognized at fair value and are subsequently classified and measured at: (i) amortized cost; (ii) fair value through other comprehensive income (“FVOCI”); or (iii) fair value through profit or loss (“FVTPL”). The classification of financial assets is generally based on the business model in which a financial asset is managed and its contractual cash flow characteristics. A financial asset is measured at fair value net of transaction costs that are directly attributable to its acquisition except for financial assets at FVTPL where transaction costs are expensed. All financial assets not classified and measured at amortized cost or FVOCI are measured at FVTPL. On initial recognition of an equity instrument that is not held for trading, the Company may irrevocably elect to present subsequent changes in the investment’s fair value in other comprehensive income.
The classification determines the method by which the financial assets are carried on the statements of financial position subsequent to inception and how changes in value are recorded. Amounts receivable and reclamation bonds are measured at amortized cost with subsequent impairments recognized in profit or loss. Cash and cash equivalents and short-term investments are classified as FVTPL.
Impairment
An ‘expected credit loss’ impairment model applies which requires a loss allowance to be recognized based on expected credit losses. The estimated present value of future cash flows associated with the asset is determined and an impairment loss is recognized for the difference between this amount and the carrying amount as follows: the carrying amount of the asset is reduced to estimated present value of the future cash flows associated with the asset, discounted at the financial asset’s original effective interest rate, either directly or through the use of an allowance account and the resulting loss is recognized in profit or loss for the period. In a subsequent period, if the amount of the impairment loss related to financial assets measured at amortized cost decreases, the previously recognized impairment loss is reversed through profit or loss to the extent that the carrying amount of the investment at the date the impairment is reversed does not exceed what the amortized cost would have been had the impairment not been recognized.
Financial liabilities
Financial liabilities are designated and subsequently measured as either: (i) fair value through profit or loss; or (ii) amortized cost. Accounts payable is classified as amortized cost.
| 13 |
American Lithium Corp.
Notes to Consolidated Financial Statements
For the years ended February 28, 2023 and 2022
(Expressed in Canadian Dollars)
| 3. | SIGNIFICANT ACCOUNTING POLICIES (continued) |
Income taxes
The Company utilizes the asset and liability method of accounting for deferred taxes. Under the asset and liability method, deferred income taxes and liabilities are recognized to reflect the expected deferred tax consequences arising from temporary differences between the carrying value and the tax bases. Deferred tax assets and liabilities are measured using the enacted or substantively enacted tax rates expected to apply when the asset is realized or the liability settled. Deferred tax assets and liabilities are offset when there is a legally enforceable right to set off current tax assets against current tax liabilities and when they relate to income taxes levied by the same taxation authority and the Company intends to settle its current tax assets and liabilities on a net basis. A deferred tax asset is recognized to the extent that it is probable that future taxable profits will be available against the asset can be utilized.
The Company’s exposure to uncertain tax positions is evaluated and a provision is made where it is probable that this exposure will materialise.
Property and equipment
Property and equipment carried at cost, less accumulated depreciation and accumulated impairment losses. The cost of an item of property and equipment consists of the purchase price, any costs directly attributable to bringing the asset to the location and condition necessary for its intended use and an initial estimate of the costs of dismantling and removing the item and restoring the site on which it is located. An item of property and equipment is derecognized upon disposal or when no future economic benefits are expected to arise from the continued use of the asset. Any gain or loss arising on disposal of the asset, determined as the difference between the net disposal proceeds and the carrying amount of the asset, is recognized in profit or loss in the consolidated statements of income and comprehensive income. Where an item of property and equipment comprises major components with different useful lives, the components are accounted for as separate items of property and equipment. Expenditures incurred to replace a component of an item of property and equipment that is accounted for separately, including major inspection and overhaul expenditures are capitalized.
Depreciation is calculated using declining balance or straight-line methods to write off the cost of the assets. The depreciation rate is applicable as follows:
| Schedule of property, plant and equipment depreciation rate | |
| Furniture and equipment | |
| Computer equipment | |
| Leasehold improvements |
Leases
At inception of a contract, the Company assesses whether a contract is, or contains, a lease. A contract is, or contains, a lease if the contract conveys the right to control the use of an identified asset for a period of time in exchange for consideration. The Company assesses whether the contract involves the use of an identified asset, whether the right to obtain substantially all of the economic benefits from use of the asset during the term of the arrangement exists, and if the Company has the right to direct the use of the asset. At inception or on reassessment of a contract that contains a lease component, the Company allocates the consideration in the contract to each lease component on the basis of their relative standalone prices.
As a lessee, the Company recognizes a right-of-use asset and a lease liability at the commencement date of a lease. The right-of-use asset is initially measured at cost, which is comprised of the initial amount of the lease liability adjusted for any lease payments made at or before the commencement date, plus any decommissioning and restoration costs, less any lease incentives received.
| 14 |
American Lithium Corp.
Notes to Consolidated Financial Statements
For the years ended February 28, 2023 and 2022
(Expressed in Canadian Dollars)
| 3. | SIGNIFICANT ACCOUNTING POLICIES (continued) |
Leases (continued)
The right-of-use asset is subsequently depreciated from the commencement date to the earlier of the end of the lease term, or the end of the useful life of the asset. In addition, the right-of-use asset may be reduced due to impairment losses, if any, and adjusted for certain remeasurements of the lease liability.
A lease liability is initially measured at the present value of the lease payments that are not paid at the commencement date, discounted by the interest rate implicit in the lease, or if that rate cannot be readily determined, the incremental borrowing rate. Lease payments included in the measurement of the lease liability are comprised of:
| · | fixed payments, including in-substance fixed payments, less any lease incentives receivable; |
| · | variable lease payments that depend on an index or a rate, initially measured using the index or rate as at the commencement date; |
| · | amounts expected to be payable under a residual value guarantee; |
| · | exercise prices of purchase options if the Company is reasonably certain to exercise that option; and |
| · | payments of penalties for terminating the lease, if the lease term reflects the lessee exercising an option to terminate the lease. |
The lease liability is measured at amortized cost using the effective interest method. It is remeasured when there is a change in future lease payments arising from a change in an index or rate, or if there is a change in the estimate or assessment of the expected amount payable under a residual value guarantee, purchase, extension, or termination option. Variable lease payments not included in the initial measurement of the lease liability are charged directly to profit or loss.
The Company has elected not to recognize right-of-use assets and lease liabilities for short-term leases that have a lease term of twelve months or less and leases of low-value assets. The lease payments associated with these leases are charged directly to profit or loss on a straight-line basis over the lease term.
Accounting pronouncements not yet adopted
The following is a listing of amendments, revisions and new International Financial Reporting Standards issued but not yet effective. The Company is currently assessing the impact of adopting the following standards on the consolidated financial statements, as described below:
| · | IAS 1 – Presentation of Financial Statements: On January 23, 2020, the IASB issued an amendment to IAS 1, Presentation of Financial Statements providing a more general approach to the classification of liabilities. The amendments clarify that the classification of liabilities as current or non-current depends on the rights existing at the end of the reporting period as opposed to the expectations of exercising the right for settlement of the liability. The amendments further clarify that settlement refers to the transfer of cash, equity, instruments, other assets, or services to the counterparty. The amendments are effective for annual periods beginning on or after January 1, 2024 and are to be applied retrospectively, with early adoption permitted. The Company does not expect this amendment to have a significant financial impact on the consolidated financial statements. |
| 15 |
American Lithium Corp.
Notes to Consolidated Financial Statements
For the years ended February 28, 2023 and 2022
(Expressed in Canadian Dollars)
| 4. | CASH AND CASH EQUIVALENTS |
The Company’s cash and cash equivalents include an aggregate
of $
In addition, the Company has cashable GICs of $
| 5. | SHORT-TERM INVESTMENTS |
The Company has an aggregate of $
| 6. | PROPERTY AND EQUIPMENT |
| Schedule of property, plant and equipment | ||||||||||||||||
| Computer Equipment |
Furniture Equipment |
Leasehold Improvement |
Total | |||||||||||||
| $ | $ | $ | $ | |||||||||||||
| Cost: | ||||||||||||||||
| Balance, February 28, 2021 | ||||||||||||||||
| Additions | ||||||||||||||||
| Balance, February 28, 2022 | ||||||||||||||||
| Additions | ||||||||||||||||
| Balance, February 28, 2023 | ||||||||||||||||
| Accumulated depreciation: | ||||||||||||||||
| Balance, February 28, 2021 | ||||||||||||||||
| Depreciation for the year | ||||||||||||||||
| Balance, February 28, 2022 | ||||||||||||||||
| Depreciation for the period | ||||||||||||||||
| Balance, February 28, 2023 | ||||||||||||||||
| Net book value: | ||||||||||||||||
| As at February 28, 2022 | ||||||||||||||||
| As at February 28, 2023 |
| 16 |
American Lithium Corp.
Notes to Consolidated Financial Statements
For the years ended February 28, 2023 and 2022
(Expressed in Canadian Dollars)
| 7. | EXPLORATION AND EVALUATION ASSETS |
| Schedule of exploration and evaluation assets | ||||||||||||||||
| TLC Project |
Falchani Project |
Macusani Project |
Total | |||||||||||||
| $ | $ | $ | $ | |||||||||||||
| Balance, February 28, 2021 | ||||||||||||||||
| Additions: | ||||||||||||||||
| Acquisition costs | ||||||||||||||||
| Maintenance fees | ||||||||||||||||
| Balance, February 28, 2022 | ||||||||||||||||
| Additions: | ||||||||||||||||
| Acquisition costs | ||||||||||||||||
| Royalty buyback | ||||||||||||||||
| Balance, February 28, 2023 |
TLC Lithium Project (“TLC Project”) – Nevada, USA
In August 2018, the Company purchased a series of unpatented lode mining claims located in Nye County, Nevada, USA, from Nevada Alaska Mining Co., Inc. (“TLC Royalty Holder”). The TLC Project was subject to an overriding 2.5% gross royalty, however, as at February 28, 2023, the royalty had been bought back in full.
The Company made the following payments for the TLC Project in during the year ended February 28, 2022:
| · | April 2021 – the Company issued common shares of the Company at a fair value of $
to acquire |
| · | September 2021 - the Company issued common shares of the Company at a fair value of $
and assumed liabilities of $ |
In June 2022, the Company closed an agreement to acquire certain
privately held agricultural lands along with certain water rights, in the Big Smoky Valley, close to the Company’s TLC Project.
Pursuant to the terms of the agreement, the Company paid the vendors a total of $
In January 2023, the Company entered into an agreement to buy back the remaining one percent (1%) gross overriding royalty on the Company’s wholly owned TLC Project. Pursuant to the terms of the agreement, the Company issued common shares of the Company on January 26, 2023, valued at $, to the TLC Royalty Holder. In addition, the Company closed a share purchase agreement with the shareholders of Maran Ventures Ltd. (“Maran”) whereby the Company purchased 100% of the outstanding shares of Maran. Maran’s only asset is its ownership of eight lode mining claims located in Nye County, Nevada, contiguous to of the TLC Project. Pursuant to the share purchase agreement, the Company issued common shares of the Company at a fair value of $, which has been accounted for as an asset acquisition.
| 17 |
American Lithium Corp.
Notes to Consolidated Financial Statements
For the years ended February 28, 2023 and 2022
(Expressed in Canadian Dollars)
| 7. | EXPLORATION AND EVALUATION ASSETS (continued) |
Falchani Lithium Project (“Falchani Project”), Macusani Uranium Project (“Macusani Project”) – Puno, Peru
Following the acquisition in May 2021 of Plateau and its Peruvian subsidiary, Macusani SAC, the Company holds title, or has court injunctions preserving title, on mineral concessions in the Province of Carabaya, Department of Puno in southeastern Peru.
32 of the 174 Falchani Project and Macusani Project concessions now held by the American Lithium’s subsidiary, Macusani SAC, are currently subject to Administrative and Judicial processes (together, the “Processes”) in Peru to overturn resolutions issued by the Geological, Mining, and Metallurgical Institute of Peru (“INGEMMET”) and the Mining Council of the Ministry of Energy and Mines of Peru (“MINEM”) in February 2019 and July 2019, respectively, which declared Macusani’s title to the 32 of the 174 concessions invalid due to late receipt of the annual validity payment. Macusani successfully applied for injunctive relief on these 32 concessions in a Court in Lima, Peru, and the grant of the Precautionary Measures restored the title, rights, and validity of those 32 concessions to Macusani.
In November 2021, the Company was made aware and announced that the judicial ruling in relation to those 32 concessions had been issued in favour of Macusani. On November 16, 2021, the Company announced that it had received official notification of the judicial ruling restoring full title to these concessions. On November 25, 2021, the Company confirmed that, as expected, appeals of the judicial ruling were lodged, including by INGEMMET and MINEM. These appeals will be considered by a high court tribunal in due course which is now scheduled for September 7, 2023. If the Company does not ultimately obtain a successful resolution of the Processes, Macusani’s title to the concessions could be revoked.
In June 2022, the Company entered into a mining rights transfer
agreement to acquire additional concessions in Southern Peru, close to the Company’s Falchani Project. The Company paid $
| 8. | RECLAMATION DEPOSITS |
Reclamation deposits of $
| 18 |
American Lithium Corp.
Notes to Consolidated Financial Statements
For the years ended February 28, 2023 and 2022
(Expressed in Canadian Dollars)
| 9. | RIGHT-OF-USE ASSETS AND LEASE LIABILITIES |
The Company has two leases: one for an office space in Vancouver, Canada and another for an office space in Nevada, USA.
Right-of-Use Assets
| Schedule of right of use asset | ||||
| Office Leases | ||||
| Cost: | $ | |||
| As at February 28, 2021 | ||||
| Additions | ||||
| Foreign exchange adjustment | ||||
| As at February 28, 2022 | ||||
| Foreign exchange adjustment | ||||
| As at February 28, 2023 | ||||
| Depreciation: | ||||
| As at February 28, 2021 | ||||
| Charge for the year | ||||
| Foreign exchange adjustment | ( | ) | ||
| As at February 28, 2022 | ||||
| Charge for the year | ||||
| Foreign exchange adjustment | ||||
| As at February 28, 2023 | ||||
| Net book value: | ||||
| As at February 28, 2022 | ||||
| As at February 28, 2023 | ||||
Depreciation of right-of-use assets is calculated using the straight-line method over the remaining lease term.
Lease Liabilities
| Schedule of lease liabilities | $ | |||
| As at February 28, 2021 | ||||
| Addition | ||||
| Lease payments made | ( | ) | ||
| Finance charge | ||||
| Foreign exchange adjustment | ||||
| As at February 28, 2022 | ||||
| Lease payments made | ( | ) | ||
| Finance charge | ||||
| Foreign exchange adjustment | ( | ) | ||
| Less: current portion | ( | ) | ||
| As at February 28, 2023 | ||||
The lease liabilities were discounted at a discount rate of
| 19 |
American Lithium Corp.
Notes to Consolidated Financial Statements
For the years ended February 28, 2023 and 2022
(Expressed in Canadian Dollars)
| 9. | RIGHT-OF-USE ASSETS AND LEASE LIABILITIES (continued) |
Lease Liabilities (continued)
The remaining minimum future lease payments, excluding estimated operating costs, for the term of the lease including assumed renewal periods are as follows:
| Schedule of remaining minimum future lease payments | |||||
| Fiscal 2024 | $ | ||||
| Fiscal 2025 | |||||
| Fiscal 2026 | |||||
| Fiscal 2027 |
| 10. | ACCOUNTS PAYABLE |
| Schedule of accounts payable | ||||||||
| 2023 | 2022 | |||||||
| $ | $ | |||||||
| Accounts payable | ||||||||
| Accrued liabilities | ||||||||
| Wages payable | ||||||||
| Accounts payable and accrued liabilities |
| 11. | LONG-TERM DEBT |
In September 2020, the Company entered into the TLC Water Rights
Agreement. Pursuant to the agreement, the Company issued a promissory note for $
| Schedule of long term debt | $ | |||
| As at February 28, 2021 | ||||
| Finance charge | ||||
| Payment made | ( | ) | ||
| Foreign exchange adjustment | ||||
| As at February 28, 2022 | ||||
| Finance charge | ||||
| Payment made | ( | ) | ||
| Foreign exchange adjustment | ||||
| As at February 28, 2023 |
In August 2022, the Company repaid the promissory note in full.
| 20 |
American Lithium Corp.
Notes to Consolidated Financial Statements
For the years ended February 28, 2023 and 2022
(Expressed in Canadian Dollars)
| 12. | SHARE CAPITAL |
Authorized
Unlimited number of common shares, without par value.
Issued
During the year ended February 28, 2023:
In June 2022, the Company issued common shares of the Company at a fair value of $ in relation to the acquisition of additional concessions in Falchani Property. (Note 7)
In January 2023, the Company issued common shares of the Company at a fair value of $ in relation to the royalty buyback on the TLC Project. (Note 7)
In January 2023, the Company issued common shares of the Company at a fair value of $ to acquire of Maran Ventures Ltd. (Note 7)
The Company issued common shares in connection with the
exercise of warrants with a weighted average exercise price of $
During the year ended February 28, 2022:
In April 2021, the Company closed a non-brokered private placement
financing of units at a price of $ per unit for gross proceeds of $
In May 2021, the Company completed the acquisition of Plateau by
issuing units of the Company. Each unit consists of one common share of the Company and one-half share purchase warrant. Each
warrant entitles the holder to purchase an additional common share of the Company at a price of $ and expires in May 2024. The
common shares issued had a fair value of $. In addition, the Company paid finder’s fee of $
In May 2021, the Company issued common shares of the Company at a fair value of $ to acquire 1301420 BC and 1301420 Nevada (Note 7).
In July 2021, the Company issued an additional common shares of the Company at a fair value of $ in relation to the acquisition of Plateau.
In September 2021, the Company issued common shares of the Company at a fair value of $ to acquire Big Smoky (Note 7).
| 21 |
American Lithium Corp.
Notes to Consolidated Financial Statements
For the years ended February 28, 2023 and 2022
(Expressed in Canadian Dollars)
| 12. | SHARE CAPITAL (continued) |
Issued (continued)
In November 2021, the Company closed a brokered private placement
financing of units at a price of $ per unit for gross proceeds of $
The Company issued common shares in connection with the
exercise of warrants with a weighted average exercise price of $ for total proceeds of $
Warrants
During the year ended February 28, 2023, the Company issued
During the year ended February 28, 2022, the Company issued the following warrants:
| · | In connection with the April 2021 private placement, warrants and finders’ warrants with an exercise price of $. |
| · | In connection with the acquisition of Plateau, |
| · | In addition, the Company assumed |
| · | In connection with the November 2021 private placement, warrants with an exercise price of $. |
Details of common share purchase warrants outstanding as at February 28, 2023 are as follows:
| Schedule of warrants outstanding | |||||||||||
| Number of warrants | Exercise price | Remaining life | Expiry date | ||||||||
| $ | (years) | ||||||||||
In connection with the acquisition of Plateau, details of Plateau’s warrants outstanding at February 28, 2023 are as follows:
| 22 |
American Lithium Corp.
Notes to Consolidated Financial Statements
For the years ended February 28, 2023 and 2022
(Expressed in Canadian Dollars)
| 12. | SHARE CAPITAL (continued) |
Warrants (continued)
| Number of warrants* | Exercise price | Number of shares issuable | Remaining life | Expiry date | |||||||||||
| $ | (years) | ||||||||||||||
*Each Plateau warrant can be exercised at a fixed ratio of 0.29 for the Company’s common shares and at a fixed ratio of 0.145 for the Company’s warrants exercisable until May 11, 2024 at $3.00.
A summary of changes of warrants outstanding is as follows:
| Schedule of changes of warrants outstanding | |||||||||
| Warrants | Weighted average exercise price | ||||||||
| $ | |||||||||
| Balance, February 28, 2021 | |||||||||
| Issued | |||||||||
| Exercised | ( | ) | |||||||
| Balance, February 28, 2022 | |||||||||
| Issued | |||||||||
| Exercised | ( | ) | |||||||
| Balance, February 28, 2023 | |||||||||
A summary of changes of Plateau warrants outstanding is as follows:
| Warrants* | Weighted
average | ||||||||
| $ | |||||||||
| Balance, February 28, 2021 | |||||||||
| Assumed | |||||||||
| Exercised | ( | ) | |||||||
| Expired | ( | ) | |||||||
| Balance, February 28, 2022 | |||||||||
| Exercised | ( | ) | |||||||
| Balance, February 28, 2023 | |||||||||
*Each Plateau warrant can be exercised at a fixed ratio of 0.29 for the Company’s common shares and at a fixed ratio of 0.145 for the Company’s warrants exercisable until May 11, 2024 at $3.00.
Stock options
The Company has established a stock option plan for directors, employees, and consultants. Under the Company's stock option plan, the exercise price of each option is determined by the Board, subject to the Discounted Market Price policies of the TSX Venture Exchange. The aggregate number of shares issuable pursuant to options granted under the plan is limited to 10% of the Company's issued shares at the time the options are granted. The aggregate number of options granted to any one optionee in a 12-month period is limited to 10% of the issued shares of the Company.
| 23 |
American Lithium Corp.
Notes to Consolidated Financial Statements
For the years ended February 28, 2023 and 2022
(Expressed in Canadian Dollars)
| 12. | SHARE CAPITAL (continued) |
Stock options (continued)
During the year ended February 28, 2023, the Company granted the following stock options:
| · | In June 2022, the Company granted |
| · | In July 2022, the Company granted |
| · | In October 2022, the Company granted |
| · | In February 2023, the Company granted |
During the year ended February 28, 2022, the Company granted the following stock options:
| · | In May 2021 and in connection with the acquisition of Plateau, the Company issued |
| · | In June 2021, the Company granted |
| · | In August 2021, the Company granted |
| 24 |
American Lithium Corp.
Notes to Consolidated Financial Statements
For the years ended February 28, 2023 and 2022
(Expressed in Canadian Dollars)
| 12. | SHARE CAPITAL (continued) |
Stock options (continued)
| · | In February 2022, the Company granted |
During the year ended February 28, 2023, the Company recorded share-based compensation of $ (2022 – $) in relation to stock options.
As at February 28, 2023, the following options were outstanding and exercisable:
| Schedule of options outstanding and exercisable | |||||||||||||||
| Number of options outstanding | Number of options Exercisable | Exercise price | Remaining life | Expiry date | |||||||||||
| $ | (years) | ||||||||||||||
A summary of changes of stock options outstanding is as follows:
| Schedule of stock options outstanding | |||||||||
| Options | Weighted average exercise price | ||||||||
| $ | |||||||||
| Balance, February 28, 2021 | |||||||||
| Granted | |||||||||
| Exercised | ( | ) | |||||||
| Cancelled | ( | ) | |||||||
| Balance, February 28, 2022 | |||||||||
| Granted | |||||||||
| Exercised | ( | ) | |||||||
| Cancelled/Expired | ( | ) | |||||||
| Balance, February 28, 2023 | |||||||||
| 25 |
American Lithium Corp.
Notes to Consolidated Financial Statements
For the years ended February 28, 2023 and 2022
(Expressed in Canadian Dollars)
| 12. | SHARE CAPITAL (continued) |
Restricted share units (“RSUs”)
In February 2022, the Company adopted an incentive plan for its directors, officers, and employees, under which it is authorized to grant a maximum of % of the Company’s issued shares reserved for issuance for RSU under the incentive plan. Upon vesting, at the Company’s discretion, the holder of an RSU award can receive one common share or the equivalent cash payment based on the market price of the common share on settlement date. The aggregate number of RSUs granted to any one recipient in a -month period is limited to % of the issued shares of the Company.
In August 2022, the newly adopted incentive plan received approval by the shareholders. The RSU grants described below were subject to such approval.
During the year ended February 28, 2023, the Company granted the following RSUs:
| · | In July 2022, the Company granted RSUs to a director and a member of senior management of the Company with a fair value of $. The RSUs will vest on . |
| · | In October 2022, the Company granted RSUs to a director of the Company with a fair value of $. The RSUs will vest on . |
| · | In February 2023, the Company granted RSUs to certain officers and directors of the Company with a fair value of $. The RSUs will vest on |
During the year ended February 28, 2022, the Company granted the following RSUs:
| · | In February 2022, the Company granted RSUs to certain officers, directors, consultants, and employees of the Company with a fair value of . The RSUs will vest on . |
During the year ended February 28, 2023, the Company recorded share-based compensation of $ (2022 – $) in relation to RSUs.
RSU transactions are summarized as follows:
| Schedule of RSU transactions | |||||
| Number of RSUs | |||||
| Balance, February 28, 2021 | |||||
| Granted | |||||
| Balance, February 28, 2022 | |||||
| Granted | |||||
| Balance, February 28, 2023 | |||||
A summary of the RSUs outstanding at February 28, 2023 is as follows:
| Schedule of restricted share units | |||||||
| Number of RSUs | Remaining life | Vesting Date | |||||
| (years) | |||||||
| 26 |
American Lithium Corp.
Notes to Consolidated Financial Statements
For the years ended February 28, 2023 and 2022
(Expressed in Canadian Dollars)
| 12. | sHARE CAPITAL (continued) |
Performance share units (“PSUs”)
In February 2022, the Company adopted an incentive plan for its directors, officers, and employees, under which it is authorized to grant a maximum of % of the Company’s issued shares reserved for issuance for PSUs under the incentive plan. Upon vesting, at the Company’s discretion, the holder of a PSU award can receive one common share or the equivalent cash payment based on the market price of the common share on settlement date. The aggregate number of PSUs granted to any one recipient in a -month period is limited to % of the issued shares of the Company.
In February 2023, the Company issued PSUs to various directors, officers, employees, and consultants of the Company. These PSUs will vest upon a change of control or disposition of a controlling interest in one of the Company’s core assets, but will not vest in connection with the contemplated spin-out transaction involving Macusani Uranium Project.
The PSUs are accounted for as equity-settled awards.
During the year ended February 28, 2023, the Company did not record any share-based compensation in connection with PSUs.
PSU transactions are summarized as follows:
| Schedule of performance share units | |||||
| Number of PSUs | |||||
| Balance, February 28, 2021 and 2022 | |||||
| Granted | |||||
| Balance, February 28, 2023 | |||||
| 13. | RELATED PARTY TRANSACTION |
Key management personnel include those persons having authority and responsibility for planning, directing, and controlling the activities of the Company as a whole. The Company has determined that key management personnel consist of executive and non-executive members of the Company’s Board of Directors and corporate officers.
| Schedule of related party transactions | ||||||||
| For the years ended February 28, |
||||||||
| 2023 | 2022 | |||||||
| $ | $ | |||||||
| Exploration and evaluation expenditures | ||||||||
| Management and directors fees | ||||||||
| Share-based compensation | ||||||||
| Total related party transactions | ||||||||
All related party transactions are recorded at the amount agreed to by the Company and the related party.
As at February 28, 2023, the Company owed $
| 27 |
American Lithium Corp.
Notes to Consolidated Financial Statements
For the years ended February 28, 2023 and 2022
(Expressed in Canadian Dollars)
| 14. | CAPITAL MANAGEMENT |
The Company’s objectives when managing capital are to safeguard the Company’s ability to continue as a going concern in order to pursue the exploration of its mineral properties and to maintain a flexible capital structure for its projects for the benefit of its stakeholders, to maintain creditworthiness and to maximize returns for shareholders over the long-term. The Company does not have any externally imposed capital requirements to which it is subject. As the Company is in the exploration stage, its principal source of funds is from the issuance of common shares. The Company includes the components of shareholders’ equity in its management of capital.
The Company manages the capital structure and makes adjustments to it in light of changes in economic conditions and the risk characteristics of the underlying assets. To maintain or adjust the capital structure, the Company may attempt to issue new shares to raise cash and obtain bridging loans from related parties. The Company’s investment policy is to invest its cash in low-risk investment instruments in financial institutions with terms to maturity selected with regards to the expected time of expenditures from continuing operations.
There were
| 15. | FINANCIAL INSTRUMENTS AND RISK MANAGEMENT |
The Company’s financial instruments consist of cash and cash equivalents, short-term investments, amounts receivable, deposits, accounts payable, and due to related parties. As at February 28, 2023, the Company classifies its cash and cash equivalents and short-term investments as fair value through profit and loss and its amounts receivable, deposits, and accounts payable at amortized cost. The fair values of these financial instruments approximate their carrying values because of their current nature.
The Company classifies the fair value of these financial instruments according to the following hierarchy based on the amount of observable inputs used to value the instrument:
Level 1 – Quoted prices are available in active markets for identical assets or liabilities as of the reporting date. Active markets are those in which transactions occur in sufficient frequency and volume to provide pricing information on an ongoing basis. Cash and cash equivalents and short-term investments are classified under Level 1.
Level 2 – Fair value measurements are those derived from inputs other than quoted prices that are observable for the asset or liability, either directly (i.e. as prices) or indirectly (derived from prices). The Company does not have any financial instruments classified under Level 2.
Level 3 – Valuations in the level are those with inputs for the asset or liability that are not based on observable market data. Amounts receivable, deposits, and accounts payable are classified under Level 3.
| 28 |
American Lithium Corp.
Notes to Consolidated Financial Statements
For the years ended February 28, 2023 and 2022
(Expressed in Canadian Dollars)
| 15. | FINANCIAL INSTRUMENTS AND RISK MANAGEMENT (continued) |
The Company’s financial instruments are exposed to the following risks:
Credit Risk
Credit risk is the risk of financial loss to the Company if a customer
or counterparty to a financial instrument fails to meet its contractual obligations. Financial instruments which are potentially subject
to credit risk for the Company consist primarily of cash and cash equivalents and short-term investments. The carrying amount of financial
assets represents the maximum credit exposure. As at February 28, 2023, the Company has gross credit exposure relating to cash and cash
equivalents and short-term investments of $
Liquidity Risk
Liquidity risk is the risk that the Company will not be able to
meet its obligations as they come due. The Company’s ability to continue as a going concern is dependent on management’s ability
to raise the required capital through future equity or debt issuances but there can be no assurance that such financing will be available
on a timely basis under terms acceptable to the Company. The Company manages its liquidity risk by forecasting cash flows from operations
and anticipating any investing and financing activities. As at February 28, 2023, the Company had a cash and cash equivalents balance
of $
Foreign Exchange Risk
The Company is exposed to foreign currency risk on fluctuations
related to cash and cash equivalents, short-term investments, reclamation deposits, and accounts payable and accrued liabilities that
are denominated in a foreign currency. As at February 28, 2023, the Company had net assets (liabilities) of USD $
Interest Rate Risk
Interest rate risk is the risk the fair value or future cash flows of a financial instrument will fluctuate because of changes in market interest rates. The Company has cash and cash equivalents balances and term deposits with interest based on the prime rate. The Company’s current policy is to invest excess cash in investment-grade short-term deposit certificates issued by its banking institution. The Company periodically monitors the investments it makes and is satisfied with the credit ratings of its banks.
Commodity Price Risk
The Company’s ability to raise capital to fund exploration or development activities is subject to risks associated with fluctuations in the market price of lithium and uranium. The Company closely monitors commodity prices to determine the appropriate course of actions to be taken.
During the years ended February 28, 2023 and 2022, there were no transfers between level 1, level 2 and level 3 classified assets and liabilities.
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American Lithium Corp.
Notes to Consolidated Financial Statements
For the years ended February 28, 2023 and 2022
(Expressed in Canadian Dollars)
| 16. | SEGMENTED INFORMATION |
The Company has one operating segment, being the acquisition and exploration of exploration and evaluation assets. Geographic information is as follows:
| Schedule of segmented information | ||||||||||||||||
| February 28, 2023 | Canada | USA | Peru | Total | ||||||||||||
| $ | $ | $ | $ | |||||||||||||
| Exploration and evaluation assets | ||||||||||||||||
| Other long-term assets | ||||||||||||||||
| February 28, 2022 | Canada | USA | Peru | Total | ||||||||||||
| $ | $ | $ | $ | |||||||||||||
| Exploration and evaluation assets | ||||||||||||||||
| Other long-term assets | ||||||||||||||||
| 17. | SUPPLEMENTAL DISCLOSURES WITH RESPECT TO CASH FLOWS |
| Schedule of supplemental disclosure with rspect to cash flows | ||||||||
| For the year ended February 28, |
||||||||
| 2023 | 2022 | |||||||
| $ | $ | |||||||
| Supplemental cash-flow disclosure: | ||||||||
| Interest | ||||||||
| Income taxes | ||||||||
| Supplemental non-cash disclosure: | ||||||||
| Shares issued for exploration and evaluation assets acquisition | ||||||||
| Units issued for acquisition | ||||||||
| Capitalization of right-of-use assets and lease liabilities | ||||||||
| Finders' shares issued for acquisition | ||||||||
| Replacement stock options issued | ||||||||
| Plateau warrants assumed | ||||||||
| Reclassification of stock options exercised | ||||||||
| Reclassification of stock options cancelled | ||||||||
| Reclassification of warrants issued | ||||||||
| Reclassification of warrants exercised | ||||||||
| Reclassification of warrants expired | ||||||||
| 18. | CONTINGENCIES |
In May 2021, the Ontario Securities Commission (“OSC”)
issued a Notice of Hearing and Statement of Allegations to Plateau and two of its officers (collectively the “Executives”),
commencing regulatory proceedings to consider whether Plateau met obligations related to continuous disclosure, associated filings and
related activities with respect to the status of Plateau’s title to 32 mineral concessions in Peru, which were the subject of a
regulatory dispute, as discussed in Note 7. In November 2022, Plateau and the Executives concluded a settlement with OSC and the matter
is now closed. In addition, proceeds of $
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American Lithium Corp.
Notes to Consolidated Financial Statements
For the years ended February 28, 2023 and 2022
(Expressed in Canadian Dollars)
| 19. | INCOME TAXES |
The following table reconciles the amount of income tax recoverable on application of the combined statutory Canadian federal and provincial income tax rates:
| Schedule of income tax recoverable | ||||||||
| For the years ended February 28, | ||||||||
| 2023 | 2022 | |||||||
| $ | $ | |||||||
| Combined statutory tax rate | % | % | ||||||
| Income tax recovery at combined statutory rate | ( | ) | ( | ) | ||||
| Impact of different statutory tax rates on earnings of subsidiaries | ||||||||
| Permanent difference and other | ||||||||
| Effect of change in future income tax rates | ||||||||
| Change in deferred tax asset not recognized | ||||||||
| Net deferred tax recovery | ||||||||
The significant components of the Company’s temporary differences, unused tax credits and unused tax losses that have not been included on the consolidated statement of financial position are as follows:
| Schedule of unused tax credits | ||||||||||||
| 2023 | Expiry Date Range | 2022 | Expiry Date Range | |||||||||
| Temporary Differences | $ | $ | ||||||||||
| Share issue costs | ||||||||||||
| Property and equipment | | | ||||||||||
| Non-capital losses available for future period | | | ||||||||||
| Exploration and evaluation Assets | | | ||||||||||
| Non-capital losses by country | ||||||||||||
| Canada | | |||||||||||
| United States | | | ||||||||||
| Peru | | | ||||||||||
Tax attributes are subject to review, and potential adjustment, by tax authorities.
| 20. | SUBSEQUENT EVENTS |
| a) | Subsequent to February 28, 2023, the Company issued common shares in connection with the exercise
of warrants with a weighted average exercise price of $ |
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