International Battery Metals Ltd (IBATF)

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8. Lithium Extraction Technology Asset Purchase (continued)
During the year ended January 31, 2019, the Company issued 4,700,000 common shares with a fair value of
$2,256,000 on the date of closing the acquisition.
The remaining shares are contingently issuable, and their fair value was estimated using a probabilityweighted analysis based on the probability of achieving the Milestones. The resulting valuation was recorded
as obligation to issue Milestone shares of $3,201,185. On November 7, 2018, the Company issued 5,536,496
Milestone shares and transferred $2,657,734 from obligation to issue shares to share capital.
As at October 31, 2020, the Company has an obligation to issue Milestone shares of $543,451 (January 31,
2020 – $543,451). The Company incurred an additional $50,000 in costs associated with the closing of the
Acquisition and is required to issue a finder’s fee of 100,000 common shares, valued at $48,000 (Note 14).
As at October 31, 2020 the Company has yet to issue these shares and has recorded an obligation to issue
shares of $48,000 (January 31, 2020 - $48,000) (Note 14).
In November 2018, the Company entered into licensing agreements as amended with Ensorcia Metals
Corporation (“Ensorcia”) and its wholly-owned subsidiaries, Sorcia Minerals LLC (“Sorcia”) and Ensorcia
Argentina LLC (“EAL”) whereby the Company issued lithium extraction technology licenses to Sorcia and
EAL to use Extraction systems manufactured by the Company in exchange for a six percent royalty (6%) on
the gross sales price of all products produced and sold, less selling costs, using the Licensed Technology and
a ten percent (10%) common membership interest in Sorcia and EAL. The agreements can be terminated by
the Company if the first extraction system is not installed or operational by June 30, 2021. As a signing
incentive, the Company issued 1,000,000 common share purchase warrants valued at $103,512 to Ensorcia
for the agreement with Sorcia which were expensed as a share-based payment expense to obtain a contract.
The Company has been delayed in finalizing the engineering and the sourcing of equipment and fabricators
to build the initial mobile extraction unit for deployment in South America. As a result, the current proposed
build of the extraction system is expected to be delayed. These delays resulted in the Company agreeing to
extend the Ensorcia Licensing agreement until June 30, 2021 due to the various issues, delays, and problems
created by the coronavirus.
During the nine months ended October 31, 2020, the Company began developing the final blueprints for, and
construction of, its first lithium extraction unit. On October 21, 2020, the Company issued 25,000,000 shares
to Sorcia in exchange for $783,177 cash, $236,674 for payments of debt Sorcia paid on behalf of the
Company, $916,719 for payments made by Sorcia to consultants for development costs relating to the
blueprints for the lithium extraction unit (Note 9), and $573,159 for payments made by Sorcia to consultants
and fabricators for the construction of the lithium extraction unit (Note 7), for a total consideration of
$2,509,729. As at October 31, 2020, Sorcia owned 32,666,666 common shares which is 36.72% of the
88,971,166 issued common shares and, as a result, could exercise significant influence over the Company.
The investments in Sorcia and EAL are accounted for as investments carried at FVTPL. As the entities are
shell holding companies, their fair value at initial recognition, October 31, 2020 and January 31, 2020 are
$nil.

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