We have filed a Registration Statement, together with all amendments and exhibits, with the SEC. This prospectus, which forms a part of that Registration Statement, does not contain all information included in the Registration Statement. Certain information is omitted and you should refer to the Registration Statement and its exhibits. With respect to references made in this prospectus to any of our contracts or other documents, the references are not necessarily complete and you should refer to the exhibits attached to the Registration Statement for copies of the actual contracts or documents. You may read and copy any document that we file at the SEC’s Public Reference Room at 100 F Street, N.E., Washington, D.C. 20549. Please call the SEC at 1-800-SEC-0330 for further information on the operation of the public reference rooms. Our filings, including the Registration Statement, can also be reviewed by accessing the SEC’s website at www.sec.gov.
We file periodic reports and other information with the SEC. Such periodic reports and other information are available for inspection and copying at the public reference room and website of the SEC referred to above. We maintain a website at www.batterymetals.com. You may access our annual reports on Form 10-K, quarterly reports on Form 10-Q, current reports on Form 8-K and amendments to those reports filed or furnished pursuant to Section 13(a) or 15(d) of the Exchange Act with the SEC free of charge at our website as soon as reasonably practicable after such material is electronically filed with, or furnished to, the SEC. The information and other content contained on any of our websites are not part of this Prospectus.
Our audited financial statements for the nine-month transition period ended June 30, 2020 and for the year ended September 30, 2019, and our quarterly report for the three months ended September 30, 2020 and September 30, 2019 are included herewith.
(The accompanying notes are an integral part of these condensed consolidated financial statements)
(The accompanying notes are an integral part of these condensed consolidated financial statements)
(The accompanying notes are an integral part of these condensed consolidated financial statements)
Notes to the Condensed Consolidated Financial Statements
For the period ended September 30, 2020
(unaudited)
1. Organization and Nature of Operations
The accompanying unaudited condensed consolidated financial statements of American Battery Metals Corporation have been prepared in accordance with the rules and regulations of the Securities and Exchange Commission (the “SEC”), including the instructions to Form 10-Q and Regulation S-X. Certain information and note disclosures normally included in financial statements prepared in accordance with generally accepted accounting principles in the United States of America have been condensed or omitted from these statements pursuant to such rules and regulations and, accordingly, they do not include all the information and notes necessary for comprehensive consolidated financial statements and should be read in conjunction with our audited consolidated financial statements for the period ended June 30, 2020, included in our Annual Report on Form 10-KT for the period ended June 30, 2020.
The Company was incorporated under the laws of the state of Nevada on October 6, 2011 for the purpose of acquiring and developing mineral properties. The Company has a wholly-owned subsidiary called Oroplata Exploraciones E Ingenieria SRL, which was incorporated in the Dominican Republic on January 10, 2012. On July 26, 2016, the Company incorporated Lithortech Resources Inc., a Nevada company, as a wholly-owned subsidiary. The Company currently holds mineral rights in the Western Nevada Basin of Nye County in the state of Nevada.
On March 11, 2020, the World Health Organization declared COVID-19 a global pandemic. This contagious disease outbreak and any related adverse public health developments, has adversely affected workforces, economies, and financial markets globally, leading to an economic downturn. The impact on the Company is not currently determinable, but management continues to monitor the situation.
Going Concern
These condensed consolidated financial statements have been prepared on a going concern basis, which implies that the Company will continue to realize its assets and discharge its liabilities in the normal course of business. As at September 30, 2020, the Company has not earned any revenue, has a working capital deficit of $3,182,537, and an accumulated deficit of $66,360,155. The continuation of the Company as a going concern is dependent upon the continued financial support from its management, and its ability to identify future investment opportunities and obtain the necessary debt or equity financing, and generating profitable operations from the Company’s future operations. If the Company is able to obtain financing, there is no certainty that terms will be favorable to the Company. These factors raise substantial doubt regarding the Company’s ability to continue as a going concern. These unaudited condensed consolidated financial statements do not include any adjustments to the recoverability and classification of recorded asset amounts and classification of liabilities that might be necessary should the Company be unable to continue as a going concern.
2. Summary of Significant Accounting Policies
(a)Basis of Presentation
The financial statements of the Company have been prepared in accordance with accounting principles generally accepted in the United States (“US GAAP”) and are expressed in U.S. dollars. The Company’s fiscal year end is June 30.
(b)Principles of Consolidation
These condensed consolidated financial statements and related notes are presented in accordance with accounting principles generally accepted in the United States and are expressed in U.S. dollars. These condensed consolidated financial statements include the accounts of the Company and its wholly-owned subsidiaries, Oroplata Exploraciones E Ingenieria SRL and LithiumOre Corporation (formerly Lithortech Resources Inc). All inter-company accounts and transactions have been eliminated on consolidation.
F-6
AMERICAN BATTERY METALS CORPORATION
Notes to the Condensed Consolidated Financial Statements
For the period ended September 30, 2020
(unaudited)
3. Convertible Notes Payable
|
September 30,
2020
$
|
June 30,
2020
$
|
Eagle Equities, LLC, $147,250 on January 31, 2020, unsecured, bears interest at 10% per annum, due on January 31, 2021, convertible into common stock at 60% of the lowest trading price in the ten trading days prior to conversion, unamortized discount of $nil (June 30, 2020 - $137,038)
|
-
|
10,212
|
|
|
|
GS Capital Partners, LLC, $147,250 on January 31, 2020, unsecured, bears interest at 10% per annum, due on January 31, 2021, convertible into common stock at 40% of the lowest trading price in the twenty trading days prior to conversion, unamortized discount of $nil (June 30, 2020 - $134,584)
|
-
|
12,666
|
|
|
|
GS Capital Partners, LLC, $177,200 on February 7, 2020, unsecured, bears interest at 10% per annum which increases to 22% per annum on default, due on February 7, 2021, convertible into common stock at 60% of the lowest trading price in the twenty trading days prior to conversion, unamortized discount of $nil (June 30, 2020 - $165,770)
|
-
|
11,430
|
|
|
|
Power Up Lending Group Ltd., $83,000 on February 14, 2020, unsecured, bears interest at 10% per annum, due on December 1, 2021, convertible into common stock at 61% of the lowest trading price in the ten trading days prior to conversion, unamortized discount of $nil (June 30, 2020 - $76,662)
|
-
|
6,338
|
|
|
|
Crown Bridge Partners, LLC, $75,000 on February 14, 2020, unsecured, bears interest at 10% per annum, due on February 14, 2021, convertible into common stock at 65% of the lower of the lowest closing bid or the lowest trading price in the twenty trading days prior to conversion, unamortized discount of $nil (June 30, 2020 - $70,577)
|
-
|
4,423
|
|
|
|
BHP Capital NY Inc., $110,000 on February 18, 2020, unsecured, bears interest at 10% per annum, due on February 18, 2021, convertible into common stock at 61% of the lesser of: (i) lowest trading price during the previous twenty trading days before the issue date; or (ii) the lowest trading price during the twenty trading days prior to conversion, unamortized discount of $nil (June 30, 2020 - $103,282)
|
-
|
6,718
|
|
|
|
Jefferson Street Capital, LLC, $110,000 on February 18, 2020, unsecured, bears interest at 10% per annum, due on February 18, 2021, convertible into common stock at 61% of the lesser of: (i) the lowest trading price during the previous twenty trading days before the issue date; or (ii) the lowest trading price during the twenty trading days prior to conversion, unamortized discount of $90,991 (June 30, 2020 - $103,818)
|
19,009
|
6,182
|
F-7
AMERICAN BATTERY METALS CORPORATION
Notes to the Condensed Consolidated Financial Statements
For the period ended September 30, 2020
(unaudited)
3. Convertible Notes Payable (continued)
|
September 30,
2020
$
|
June 30,
2020
$
|
Odyssey Capital, LLC, $220,000 on February 19, 2020, unsecured, bears interest at 10% per annum, due on February 19, 2021 convertible into common stock at 60% of the lowest closing bid price for the fifteen trading days prior to conversion, unamortized discount of $nil (June 30, 2020 - $205,226)
|
-
|
14,774
|
|
|
|
GS Capital Partners, LLC, $520,000 on March 17, 2020, unsecured, bears interest at 10% per annum, due on March 17, 2021, convertible into common stock at 63% of the lowest trading price in the twenty trading days prior to conversion, unamortized discount of $119,537 (June 30, 2020 - $478,979)
|
130,463
|
41,021
|
|
|
|
Power Up Lending Group Ltd., $78,000 on April 6, 2020, unsecured, bears interest at 12% per annum which increases to 22% per annum on default, due on April 6, 2021, convertible into common stock at 61% of the lowest trading price in the ten trading days prior to conversion, unamortized discount of $68,409 (June 30, 2020 - $75,816)
|
9,591
|
2,184
|
|
|
|
Adar Alef, LLC, $110,000 on April 7, 2020, unsecured, bears interest at 10% per annum, due April 7, 2021, convertible into common stock at 60% of the lowest closing bid price for the fifteen trading days prior to conversion, unamortized discount of $100,110 (June 30, 2020 - $107,464)
|
9,890
|
2,536
|
|
|
|
Auctus Fund, LLC, $150,000 on April 10, 2020, unsecured, bears interest at 10% per annum which increases to 24% per annum on default, due on April 10, 2021, convertible into common stock at 68% of the lowest trading in the twenty trading days prior to conversion, unamortized discount of $136,632 (June 30, 2020 - $146,667)
|
13,368
|
3,333
|
|
|
|
Power Up Lending Group Ltd., $43,000 on April 21, 2020, unsecured, bears interest at 10% per annum which increases to 22% per annum on default, due on April 21, 2021, convertible into common stock at 61% of the lowest trading price during the ten trading days prior to conversion, unamortized discount of $39,615 (June 30, 2020 - $42,176)
|
3,385
|
824
|
|
|
|
Black Ice Advisors, LLC, $115,500 on April 22, 2020, unsecured, bears interest at 10% per annum, due on April 22, 2021, convertible into common stock at 60% of the lowest closing bid price for the fifteen trading days prior to conversion, unamortized discount of $106,709 (June 30, 2020 - $113,318)
|
8,791
|
2,182
|
|
|
|
Efrat Investments, LLC, $125,000 on April 23, 2020, unsecured, bears interest at 10% per annum, due on April 23, 2021, convertible into common stock at 60% of the lowest closing bid price for the fifteen trading days prior to conversion, unamortized discount of $115,613 (June 30, 2020 - $122,674)
|
9,387
|
2,326
|
F-8
AMERICAN BATTERY METALS CORPORATION
Notes to the Condensed Consolidated Financial Statements
For the period ended September 30, 2020
(unaudited)
3. Convertible Notes Payable (continued)
|
September 30,
2020
$
|
June 30,
2020
$
|
GS Capital Partners, LLC, $520,000 on July 27, 2020, unsecured, bears interest at 10% per annum, due on October 27, 2021 convertible into common stock at 1) fixed price of $0.25 per share during the first 6 months this note is in effect; and 2) 64% of the lowest trading price for the twenty trading days prior to conversion after the 6th monthly anniversary of the note, unamortized discount of $10,000 (June 30, 2020 - $nil)
|
510,000
|
-
|
|
|
|
GS Capital Partners, LLC, $312,000 on August 14, 2020, unsecured, bears interest at 10% per annum, due on August 14, 2021, convertible into common stock at 1) fixed price of $0.25 per share during the first 6 months this note is in effect; and 2) 64% of the lowest trading price for the twenty trading days prior to conversion after the 6th monthly anniversary of the note, unamortized discount of $6,000 (June 30, 2020 - $nil)
|
306,000
|
-
|
|
|
|
Jefferson Street Capital, LLC, $302,500 on September 29, 2020, unsecured, bears interest at 1% per annum which increases to 22% per annum on default, due on March 29, 2021, convertible into common stock at the lesser of 1) 70% of the lowest trading price for the ten trading days prior to the issue date of this note or; 2) 70% of the lowest trading price for the ten trading days prior to conversion, unamortized discount of $302,492 (June 30, 2020 - $nil)
|
8
|
-
|
|
|
|
|
1,019,892
|
127,149
|
During the three months ended September 30, 2020, the Company paid $913,233 (2019 - $221,663) for the settlement of $635,250 (2019 - $163,766) of outstanding principal balance of convertible notes, $30,662 (2019 - $8,966) of accrued interest, $213,599 (2019 - $nil) of financing costs, and $1,418,312 (2019 - $128,013) of derivative liabilities resulting in a gain on settlement of debt of $1,384,590 (2019 - $79,082).
4. Equipment
|
Vehicle
$
|
Cost:
|
|
|
|
Balance, June 30, 2020
|
61,916
|
Additions
|
-
|
|
|
Balance, September 30, 2020
|
61,916
|
|
|
Accumulated Depreciation:
|
|
|
|
Balance, June 30, 2019
|
3,110
|
Additions
|
2,601
|
|
|
Balance, September 30, 2020
|
5,711
|
Carrying Amounts:
|
|
|
|
Balance, June 30, 2020
|
58,806
|
Balance, September 30, 2020
|
56,205
|
F-9
AMERICAN BATTERY METALS CORPORATION
Notes to the Condensed Consolidated Financial Statements
For the period ended September 30, 2020
(unaudited)
5. Related Party Transactions
(a)As of September 30, 2020, the Company owes $120,146 (June 30, 2020 - $120,146) to the former Chief Executive Officer and Director of the Company for advances to the Company to fund day-to-day operations. The amounts owing are unsecured, non-interest bearing, and due on demand.
(b)As of September 30, 2020, the Company owes $85,500 (June 30, 2020 - $85,500) to the former Chief Executive Officer and Director of the Company for advances to the Company to fund day-to-day operations and accrued management fees. The amounts owing are unsecured, non-interest bearing, and due on demand.
(c)As of September 30, 2020, the Company owes $142,084 (June 30, 2020 - $388,577) to the Chief Executive Officer of the Company for accrued management fees. The amounts owing are unsecured, non-interest bearing, and due on demand.
(d)As of September 30, 2020, the Company owes $30,726 (June 30, 2020– $30,726) to directors of the Company for accrued management fees. The amounts owing are unsecured, non-interest bearing, and due on demand.
6. Investment in Joint Venture
On October 8, 2018, the Company entered into a joint venture agreement with CINC Industries Inc. (“CINC”), a non-related Nevada company, for a period of five years whereby the joint venture will propagate the sale of a new process for extraction of lithium salt from salt brine solutions using CINC’s existing and future processing equipment. As part of the joint venture, each of CINC and the Company holds a 50% interest in the joint venture.
CINC is responsible for completing testing on the pilot project, providing training to the Company for use of its processing equipment, manufacturing up to 20 test units, and support and product development, as well as shared costs on other personnel utilized in the joint venture company. The Company is responsible for the initial funding for all equipment and associated expenses, the cost of the lease space, and marketing and sales of the joint venture agreement.
As part of the joint venture agreement, the Company issued 250,000 common shares to CINC. The joint venture is committed to acquiring a minimum amount of processing equipment, goods, accessories, and/or materials totaling: (i) $1,000,000 by October 8, 2020; (ii) $3,000,000 by October 8, 2021; (iii) $6,000,000 by October 8, 2022; and (v) $10,000,000 by October 8, 2023. In the event that the joint venture fails to meet the minimum amounts above, the Company will lose the exclusive right to market, promote and sell the processing equipment provided by CINC.
While technically still in place, the October 8, 2020 milestone was not met, and the Company does not believe this joint venture agreement will go forward.
7. Derivative Liabilities
The Company records the fair value of the conversion price of the convertible debentures in accordance with ASC 815, Derivatives and Hedging. The fair value of the derivatives was calculated using a multi-nominal lattice model. The fair value of the derivative liabilities is revalued on each balance sheet date with corresponding gains and losses recorded in the consolidated statement of operations. For the three months ended September 30, 2020, the Company recorded a loss on the change in the fair value of derivative liability of $773,886 (2019 - $62,554). As at September 30, 2020, the Company recorded a derivative liability of $2,777,634 (June 30, 2020 - $4,519,654).
The following inputs and assumptions were used to value the derivative liabilities outstanding at September 30, 2020 and June 30, 2020:
|
September 30,
2020
|
June 30,
2020
|
Expected volatility
|
134-235%
|
158-240%
|
Risk free rate
|
0.11-0.18%
|
0.16%
|
Expected life (in years)
|
0.375-1.0
|
0.5-1.0
|
F-10
AMERICAN BATTERY METALS CORPORATION
Notes to the Condensed Consolidated Financial Statements
For the period ended September 30, 2020
(unaudited)
7. Derivative Liabilities (Continued)
A summary of the activity of the derivative liability is shown below:
|
$
|
|
|
Balance, June 30, 2020
|
4,519,654
|
Derivative additions associated with convertible notes
|
275,000
|
Adjustment for conversion/prepayment
|
(2,790,906)
|
Mark-to-market adjustment
|
773,886
|
|
|
Balance, September 30, 2020
|
2,777,634
|
8. Loans Payable
(a)On January 27, 2020, the Company entered into a finance loan agreement relating to the acquisition of a company vehicle. Under the terms of the finance loan, the Company will make monthly installment payments of $1,089 at a finance loan interest rate of 7.99% per annum, which is due in February 2026. As of September 30, 2020, the Company owed $57,142 (June 30, 2020 - $59,236) on the finance loan, including $8,755 (June 30, 2020 - $8,580) which is due in the next twelve months.
(b)On May 7, 2020, the Company received $255,992 from the U.S. Small Business Administration as part of as part of the Coronavirus Aid Relief and Economic Security (“CARES”) Act Paycheck Protection Program. The amounts are unsecured, bears interest at 1% per annum and is payable monthly commencing on November 7, 2020, and is due on May 7, 2022. The terms of the loan provide that certain amount may be forgiven if the funds are used for qualifying expenses as described in the CARES Act.
9. Common Shares
The Company’s authorized common stock consists of 1,200,000,000 shares of common stock, with par value of $0.001 per share, and authorized Series A preferred stock of 500,000 shares of preferred stock, with par value of $0.001 per share.
Period ended September 30, 2020
On July 9, 2020, the Company issued 7,950,000 common shares with a fair value of $941,280 for consulting services.
On July 9, 2020, the Company issued 6,081,150 common shares with a fair value of $720,008 for the conversion of $147,250 of note payable, $6,503 of accrued interest, $105 of fees and $614,477 of derivative liability resulting in a gain on settlement of $48,327.
On August 18, 2020, the Company issued 2,890,000 common shares with a fair value of $262,990 for consulting services.
On August 26, 2020, the Company issued 2,196,822 common shares with a fair value of $193,320 for the conversion of $100,000 of note payable, $5,342 of accrued interest, $105 of fees and $110,007 of derivative liability resulting in a gain on settlement of $22,134.
On August 27, 2020, the Company issued 5,055,132 common shares for the exercise of cashless warrants.
On September 16, 2020, the Company issued 1,696,856 common shares with a fair value of $157,808 for the conversion of $77,200 of note payable, $4,931 of accrued interest, $105 of fees and $87,842 of derivative liability resulting in a gain on settlement of $12,270.
On September 29, 2020, the Company issued 2,400,000 common shares with a fair value of $378,000 for consulting services, including 2,000,000 common shares with a fair value of $315,000 issued to a director of the Company as management fee.
F-11
AMERICAN BATTERY METALS CORPORATION
Notes to the Condensed Consolidated Financial Statements
For the period ended September 30, 2020
(unaudited)
9. Common Shares (continued)
On September 30, 2020, the Company issued 5,178,487 common shares with a fair value of $699,096 for the conversion of $270,000 of note payable, $13,833 of accrued interest, $105 of fees and $560,268 of derivative liability resulting in a gain on settlement of $145,110.
During the three months ended September 30, 2020, the Company issued 60,625,000 units for proceeds of $2,450,000 received during the year ended June 30, 2020. Each unit is comprised of one common share of the Company and 0.8 share purchase warrant where each whole share purchase warrant can be exercised into one common share of the Company at $0.15 per share until October 31, 2024.
As at September 30, 2020, the Company received share subscriptions of $1,343,750 for the future issuance of private placement units at $50,000 per unit, where each unit is comprised of 5,000 shares of Series C Preferred Stock (each share of Series C Preferred Stock is convertible into 80 shares of common stock) and a warrant to purchase 400,000 common shares of the Company at $0.075 per share until December 31, 2023.
Period ended September 30, 2019
On July 8, 2019, the Company issued 1,650,000 common shares with a fair value of $396,000 for consulting services.
On July 15, 2019, the Company issued 1,352,240 common shares with a fair value of $311,015 as part of a conversion of $190,000 of convertible notes payable, $11,192 of accrued interest and derivative liability of $133,574, resulting in a gain on settlement of debt of $23,750.
On July 19, 2019, the Company issued 1,414.000 common shares with a fair value of $162,610 as part of the conversion of $136,100 of convertible notes payable and $26,510 of accrued interest.
On July 30, 2019, the Company issued 160,552 common shares with a fair value of $27,294 for the settlement of $15,000 of convertible notes payable, conversion fees of $500, accrued interest of $9, and derivative liability of $12,388 resulting in a gain on settlement of debt of $603.
On July 31, 2019, the Company issued 129,453 common shares with a fair value of $23,302 for the settlement of $12,500 of convertible notes payable and $10,853 of derivative liability resulting in a gain on settlement of debt of $51.
On August 1, 2019, the Company issued 300,000 common shares with a fair value of $54,000 for consulting services.
On August 8, 2019, the Company issued 196,711 common shares with a fair value of $34,424 for the settlement of $20,000 of convertible notes payable, conversion fees of $500, and derivative liability of $13,998 resulting in a gain on settlement of debt of $74.
On August 12, 2019, the Company issued 167,946 common shares with a fair value of $28,551 for the settlement of $17,500 of convertible notes payable and $11,110 of derivative liability resulting in a gain on settlement of debt of $59.
On August 21, 2019, the Company issued 1,500,000 common shares with a fair value of $226,500 for consulting services including 1,000,000 common shares with a fair value of $151,000 to the Chief Executive Officer of the Company.
On August 22, 2019, the Company issued 1,233,035 common shares with a fair value of $188,038 for the conversion of $110,000 of convertible notes payable, $6,781 of accrued interest, and $76,580 of derivative liability resulting in a gain on settlement of debt of $5,223.
On August 27, 2019, the Company issued 310,606 common shares with a fair value of $34,167 for the conversion of $20,000 of convertible notes payable, conversion fees of $500, and derivative liability of $13,717 resulting in a gain on settlement of debt of $50.
On August 27, 2019, the Company issued 303,030 common shares with a fair value of $33,333 for the conversion of $20,000 of convertible notes payable and $13,383 of derivative liability resulting in a gain on settlement of debt of $50.
F-12
AMERICAN BATTERY METALS CORPORATION
Notes to the Condensed Consolidated Financial Statements
For the period ended September 30, 2020
(unaudited)
9. Common Shares (continued)
On September 3, 2019, the Company issued 507,826 common shares with a fair value of $49,513 for the settlement of $30,000 of convertible notes payable, conversion fees of $500, and derivative liability of $19,078 resulting in a gain on settlement of debt of $65.
On September 3, 2019, the Company issued 249,727 common shares with a fair value of $24,348 for the settlement of $15,000 of convertible notes payable, $988 of accrued interest, and $9,149 of derivative liability resulting in a gain on settlement of debt of $789.
On September 5, 2019, the Company issued 504,919 common shares with a fair value of $40,394 for the settlement of $25,000 of convertible notes payable, $1,660 of accrued interest, and $15,344 of derivative liability resulting in a gain on settlement of debt of $1,610.
On September 6, 2019, the Company issued 388,257 common shares with a fair value of $29,090 for the settlement of $20,000 of convertible notes payable, conversion fees of $500, and derivative liability of $8,620 resulting in a gain on settlement of debt of $40.
On September 9, 2019, the Company issued 622,086 common shares with a fair value of $42,862 for the settlement of $25,000 of convertible notes payable, $1,688 of accrued interest, and $17,260 of derivative liability resulting in a gain on settlement of debt of $1,086.
On September 11, 2019, the Company issued 426,997 common shares with a fair value of $43,554 for the settlement of $15,000 of convertible notes payable, $500 of conversion fees, and $28,080 of derivative liability resulting in a gain on settlement of debt of $25.
On September 11, 2019, the Company issued 471,763 common shares with a fair value of $48,120 for the settlement of $12,500 of convertible notes payable, $500 of conversion fees, and $2,913 of accrued interest and derivative liability resulting in a loss on settlement of debt of $32,207.
On September 11, 2019, the Company issued 650,000 common shares with a fair value of $66,300 for the settlement of $17,375 of convertible notes payable, $500 of conversion fees, and $49,683 of derivative liability resulting in a gain on settlement of debt of $1,258.
On September 13, 2019, the Company issued 200,000 common shares with a fair value of $14,000 for consulting services.
On September 16, 2019, the Company issued 736,532 common shares with a fair value of $51,395 for the settlement of $30,000 of convertible notes payable, $2,100 of accrued interest, and $50,051 of derivative liability resulting in a gain on settlement of debt of $2,564.
On September 17, 2019, the Company issued 1,619,344 common shares with a fair value of $100,399 for the settlement of $55,000 of convertible notes payable, $3,782 of accrued interest, and $50,872 of derivative liability resulting in a gain on settlement of debt of $9,255.
On September 17, 2019, the Company issued 463,843 common shares with a fair value of $28,758 for the settlement of $10,000 of convertible notes payable, $500 of conversion fees, $6,338 of accrued interest, and $1,487 of derivative liability resulting in a loss on settlement of debt of $10,433.
On September 18, 2019, the Company issued 884,298 common shares with a fair value of $79,587 for the settlement of $30,000 of convertible notes payable, $2,100 of accrued interest, and $50,051 of derivative liability resulting in a gain on settlement of debt of $2,564.
F-13
AMERICAN BATTERY METALS CORPORATION
Notes to the Condensed Consolidated Financial Statements
For the period ended September 30, 2020
(unaudited)
10. Share Purchase Warrants
|
Number of
warrants
|
Weighted
average
exercise
price
$
|
Balance, June 30, 2020
|
8,603,112
|
0.14
|
Issued
|
48,500,000
|
0.15
|
Exercised
|
(250,000)
|
0.17
|
|
|
|
Balance, September 30, 2020
|
56,853,112
|
0.15
|
Additional information regarding share purchase warrants as of September 30, 2020, is as follows:
|
Outstanding and exercisable
|
Range of
Exercise Prices
$
|
Number of
Warrants
|
Weighted Average
Remaining Contractual
Life (years)
|
0.075
|
51,500,000
|
3.7
|
0.1
|
3,250,000
|
0.16
|
0.15
|
1,500,000
|
0.09
|
0.18
|
361,112
|
0.02
|
0.5
|
242,000
|
0
|
|
|
|
|
56,853,112
|
3.97
|
11. Subsequent Events
(a)On October 1, 2020, the Company purchased land for $900,000, of which $50,000 was held in an escrow and included in prepaid expenses for the period ended September 30, 2020. The land is comprised of 12.44 acres and is located at 345 Winston Lane in Fernley, Nevada,
(b)On October 9, 2020, the Company issued 4,805,558 common shares pursuant to the conversion of $250,000 of convertible notes payable and $13,288 of accrued interest dated March 17, 2020.
(c)On October 20, 2020, the Company issued 1,326,098 common shares pursuant to the conversion of $71,548 of convertible notes payable and $6,904 of accrued interest dated April 10, 2020.
(d)Subsequent to September 30, 2020, the Company received $820,750 of subscription proceeds relating to the issuance of units of Series C preferred stock for $50,000 per unit where each unit is comprised of 5,000 Series C Preferred Stock (convertible into common shares of the Company at 80 common shares per Series C Preferred Stock) and one share purchase warrant where each warrant is exercisable into 400,000 common shares of the Company at $0.25 per share until December 31, 2023.
F-14
AMERICAN BATTERY METALS CORPORATION
Financial Statements
For the nine months ended June 30, 2020 and twelve months ended September 30, 2019
Report of Independent Registered Public Accounting Firm
|
F-16
|
Consolidated Balance Sheets
|
F-17
|
Consolidated Statements of Operations
|
F-18
|
Consolidated Statement of Stockholders’ Deficit
|
F-19
|
Consolidated Statements of Cash Flows
|
F-20
|
Notes to the Consolidated Financial Statements
|
F-21
|
F-15
REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
To The Board of Directors and Stockholders of
American Battery Metals Corporation
Opinion on the Financial Statements
We have audited the accompanying consolidated balance sheets of American Battery Metals Corporation (the “Company”) as of June 30, 2020 and September 30, 2019, and the related consolidated statements of operations, stockholders’ deficit, and cash flows for the nine months ended June 30, 2020 and the twelve months ended September 30, 2019 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 as of June 30, 2020 and September 30, 2019, and the results of its operations and its cash flows for the periods then ended, in conformity with accounting principles generally accepted in the United States of America.
Consideration of the Company’s Ability to Continue as a Going Concern
The accompanying consolidated financial statements have been prepared assuming the Company will continue as a going concern. As discussed in Note 1 to the consolidated financial statements, the Company has not generated sufficient cash flows from operations to fund its business operations. This factor, among others, raises substantial doubt about the Company’s ability to continue as a going concern. Management’s plans in regard to this matter are also described in Note 1. The consolidated financial statements do not include any adjustments that might result from the outcome of this uncertainty.
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) (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 audits 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/Pinnacle Accountancy Group of Utah
We have served as the Company’s auditor since 2016.
Farmington, Utah
September 28, 2020
F-16
AMERICAN BATERY METALS CORPORATION
Consolidated Balance Sheets
|
June 30,
2020
$
|
September 30,
2019
$
|
ASSETS
|
|
|
Current assets
|
|
|
Cash
|
829,924
|
7,371
|
Prepaid expenses
|
237,334
|
50,073
|
|
|
|
Total current assets
|
1,067,258
|
57,444
|
|
|
|
Investment in joint venture
|
35,250
|
35,250
|
Property and equipment
|
58,806
|
-
|
|
|
|
Total assets
|
1,161,314
|
92,694
|
|
|
|
LIABILITIES
|
|
|
Current liabilities
|
|
|
Accounts payable and accrued liabilities
|
514,838
|
585,797
|
Due to related parties
|
624,949
|
458,269
|
Derivative liability
|
4,519,654
|
3,437,200
|
Notes payable, net of unamortized discount of $2,084,051 and $3,094,911, respectively
|
127,149
|
398,348
|
Current portion of loans payable
|
8,580
|
-
|
|
|
|
Total current liabilities
|
5,795,170
|
4,879,614
|
|
|
|
Loans payable
|
306,648
|
-
|
Notes payable, non-current portion, net of unamortized discount of $nil and $149,458, respectively
|
-
|
542
|
|
|
|
Total liabilities
|
6,101,818
|
4,880,156
|
|
|
|
STOCKHOLDERS’ DEFICIT
|
|
|
Series A Preferred Stock
Authorized: 500,000 preferred shares, par value of $0.001 per share
Issued and outstanding: 300,000 and nil preferred shares, respectively
|
300
|
-
|
|
|
|
Common Stock
Authorized: 1,200,000,000 common shares, par value of $0.001 per share
|
|
|
Issued and outstanding: 365,191,213 and 132,678,133 common shares, respectively
|
365,191
|
132,678
|
|
|
|
Additional paid-in capital
|
55,452,951
|
44,970,398
|
Share subscription received
|
2,450,000
|
-
|
Deficit
|
(63,208,946)
|
(49,890,538)
|
|
|
|
Total stockholders’ deficit
|
(4,940,504)
|
(4,787,462)
|
|
|
|
Total liabilities and stockholders’ equity (deficit)
|
1,161,314
|
92,694
|
(The accompanying notes are an integral part of these consolidated financial statements)
F-17
AMERICAN BATTERY METALS CORPORATION
Consolidated Statements of Operations
|
For the nine
months ended
June 30,
2020
$
|
For the twelve
months ended
September 30,
2019
$
|
Expenses
|
|
|
Exploration costs
|
292,656
|
1,037,035
|
General and administrative
|
4,094,513
|
9,449,588
|
|
|
|
Net loss from operations
|
(4,387,169)
|
(10,486,623)
|
|
|
|
Other income (expense)
|
|
|
Accretion and interest expense
|
(4,391,184)
|
(2,491,621)
|
Change in fair value of derivative liability
|
(5,863,127)
|
(218,922)
|
Gain on settlement of debt
|
1,319,326
|
571,962
|
Other income
|
3,746
|
-
|
|
|
|
Total other income (expense)
|
(8,931,239)
|
(2,138,581)
|
|
|
|
Net loss
|
(13,318,408)
|
(12,625,204)
|
Net loss per share, basic and diluted
|
(0.05)
|
(0.11)
|
Weighted average shares outstanding, basic and diluted
|
254,938,086
|
112,948,676
|
(The accompanying notes are an integral part of these consolidated financial statements)
F-18
AMERICAN BATTERY METALS CORPORATION
Consolidated Statement of Stockholders’ Deficit
|
Series A
Preferred Shares
|
Common Shares
|
|
|
|
|
|
Number
|
Amount
$
|
Number
|
Amount
$
|
Additional
Paid-In
Capital
$
|
Share
Subscriptions
$
|
Deficit
$
|
Total
$
|
Balance, September 30, 2018
|
-
|
-
|
93,331,449
|
93,331
|
34,739,491
|
-
|
(37,265,334)
|
(2,432,512)
|
|
|
|
|
|
|
|
|
|
Shares issued for services
|
-
|
-
|
26,700,000
|
26,700
|
7,066,410
|
-
|
-
|
7,093,110
|
|
|
|
|
|
|
|
|
|
Shares issued pursuant to
note conversion
|
-
|
-
|
22,396,684
|
22,397
|
3,119,497
|
-
|
-
|
3,141,894
|
|
|
|
|
|
|
|
|
|
Shares issued for joint venture
|
-
|
-
|
250,000
|
250
|
35,000
|
-
|
-
|
35,250
|
|
|
|
|
|
|
|
|
|
Share cancellation
|
-
|
-
|
(10,000,000)
|
(10,000)
|
10,000
|
-
|
-
|
-
|
|
|
|
|
|
|
|
|
|
Net loss for the year
|
-
|
-
|
-
|
-
|
-
|
-
|
(12,625,204)
|
(12,625,204)
|
|
|
|
|
|
|
|
|
|
Balance, September 30, 2019
|
-
|
-
|
132,678,133
|
132,678
|
44,970,398
|
-
|
(49,890,538)
|
(4,787,462)
|
(The accompanying notes are an integral part of these consolidated financial statements)
AMERICAN BATTERY METALS CORPORATION
Consolidated Statement of Stockholders’ Deficit
|
Series A
Preferred Shares
|
Common Shares
|
|
|
|
|
|
Number
|
Amount
$
|
Number
|
Amount
$
|
Additional
Paid-In
Capital
$
|
Share
Subscriptions
Received
$
|
Deficit
$
|
Total
$
|
Balance, September 30, 2019
|
-
|
-
|
132,678,133
|
132,678
|
44,970,398
|
-
|
(49,890,538)
|
(4,787,462)
|
|
|
|
|
|
|
|
|
|
Shares issued for services
|
-
|
-
|
24,111,031
|
24,111
|
1,048,267
|
-
|
-
|
1,072,378
|
|
|
|
|
|
|
|
|
|
Shares issued for exercise of warrants
|
-
|
-
|
9,924,304
|
9,924
|
(9,924)
|
-
|
-
|
-
|
|
|
|
|
|
|
|
|
|
Shares issued from private placement
|
-
|
-
|
3,750,000
|
3,750
|
146,250
|
-
|
-
|
150,000
|
|
|
|
|
|
|
|
|
|
Shares issued pursuant to note conversion
|
-
|
-
|
193,014,921
|
193,015
|
9,120,896
|
-
|
-
|
9,313,911
|
|
|
|
|
|
|
|
|
|
Share subscriptions received
|
-
|
-
|
-
|
-
|
-
|
2,450,000
|
-
|
2,450,000
|
|
|
|
|
|
|
|
|
|
Warrant cancellation
|
-
|
-
|
1,712,824
|
1,713
|
(1,713)
|
-
|
-
|
-
|
|
|
|
|
|
|
|
|
|
Fair value of share purchase warrants
|
-
|
-
|
-
|
-
|
179,077
|
-
|
-
|
179,077
|
|
|
|
|
|
|
|
|
|
Issuance of preferred shares
|
300,000
|
300
|
-
|
-
|
(300)
|
-
|
-
|
-
|
|
|
|
|
|
|
|
|
|
Net loss for the period
|
-
|
-
|
-
|
-
|
-
|
-
|
(13,318,408)
|
(13,318,408)
|
|
|
|
|
|
|
|
|
|
Balance, June 30, 2020
|
300,000
|
300
|
365,191,213
|
365,191
|
55,452,951
|
2,450,000
|
(63,208,946)
|
(4,940,504)
|
(The accompanying notes are an integral part of these consolidated financial statements)
F-19
AMERICAN BATTERY METALS CORPORATION
Consolidated Statements of Cash Flows
|
For the nine
months ended
June 30,
2020
$
|
For the twelve
months ended
September 30,
2019
$
|
Operating Activities
|
|
|
|
|
|
Net loss
|
(13,318,408)
|
(12,625,204)
|
|
|
|
Adjustments to reconcile net loss to net cash used in operating activities:
|
|
|
Accretion expense
|
3,971,342
|
2,241,933
|
Change in fair value of derivative liability
|
5,863,127
|
218,922
|
Discount on convertible notes payable
|
396,893
|
198,602
|
Fair value of share purchase warrants issued
|
179,077
|
-
|
Gain on settlement of debt
|
(1,319,326)
|
(571,962)
|
Shares issued for services
|
1,072,378
|
7,093,110
|
|
|
|
Changes in operating assets and liabilities:
|
|
|
Prepaid expenses
|
(182,935)
|
135,927
|
Accounts payable and accrued liabilities
|
152,653
|
199,813
|
Due to related parties
|
166,680
|
(124,608)
|
|
|
|
Net Cash Used in Operating Activities
|
(3,018,519)
|
(3,233,467)
|
|
|
|
Investing Activities
|
|
|
Acquisition of equipment
|
(3,896)
|
-
|
|
|
|
Net Cash Used in Investing Activities
|
(3,896)
|
-
|
|
|
|
Financing Activities
|
|
|
Proceeds from issuance of convertible notes payable
|
2,522,250
|
4,601,900
|
Proceeds from bank loan
|
255,992
|
-
|
Repayment of convertible note payable
|
(1,533,274)
|
(1,483,831)
|
Proceeds from share subscriptions received
|
2,600,000
|
-
|
|
|
|
Net Cash Provided by Financing Activities
|
3,844,968
|
3,118,069
|
|
|
|
Change in Cash
|
822,553
|
(115,398)
|
Cash – Beginning
|
7,371
|
122,769
|
|
|
|
Cash – End
|
829,924
|
7,371
|
|
|
|
Supplemental disclosures:
|
|
|
Interest paid
|
64,973
|
-
|
Income taxes paid
|
-
|
-
|
|
|
|
Non-cash investing and financing activities:
|
|
|
Discount on convertible debenture
|
396,893
|
198,602
|
Original issuance discount on convertible debentures
|
149,300
|
99,750
|
Preferred shares issued to officers and directors
|
300
|
-
|
Common shares issued to settle accrued interest
|
-
|
123,795
|
Common shares issued for joint venture
|
-
|
35,250
|
Common shares issued for conversion of debt
|
9,313,911
|
3,018,099
|
(The accompanying notes are an integral part of these consolidated financial statements)
F-20
AMERICAN BATTERY METALS CORPORATION
Notes to the Consolidated Financial Statements
For the nine months ended June 30, 2020 and twelve months ended September 30, 2019
1. Organization and Nature of Operations
American Battery Metals Corporation (formerly Oroplata Resources Inc.) (“the Company”) was incorporated under the laws of the state of Nevada on October 6, 2011 for the purpose of acquiring and developing mineral properties. The Company has a wholly owned subsidiary called Oroplata Exploraciones E Ingenieria SRL, which was incorporated in the Dominican Republic on January 10, 2012. On July 26, 2016, the Company incorporated LithiumOre Corporation (formerly Lithortech Resources Inc.), a Nevada company, as a wholly owned subsidiary. On July 5, 2019, the Company incorporated ABMC AG, LLC, a Nevada company, as a wholly owned subsidiary. The Company currently holds mineral rights in the Western Nevada Basin of Nye County in the state of Nevada. In July 2020, management changed its year end date from September 30th to June 30th, and these consolidated financial statements reflect the nine-month period ended June 30, 2020 and the twelve-month period ended September 30, 2019.
On March 11, 2020, the World Health Organization declared COVID-19 a global pandemic. This contagious disease outbreak and any related adverse public health developments, has adversely affected workforces, economies, and financial markets globally, leading to an economic downturn. The impact on the Company is not currently determinable, but management continues to monitor the situation.
Going Concern
These consolidated financial statements have been prepared on a going concern basis, which implies that the Company will continue to realize its assets and discharge its liabilities in the normal course of business. As at June 30, 2020, the Company has not earned revenue, has a working capital deficit of $4,727,912, and an accumulated deficit of $63,208,946. The continuation of the Company as a going concern is dependent upon the continued financial support from its management, and its ability to identify future investment opportunities and obtain the necessary debt or equity financing and generating profitable operations from the Company’s future operations. If the Company is able to obtain financing, there is no certainty that terms will be favorable to the Company. These factors raise substantial doubt regarding the Company’s ability to continue as a going concern. These consolidated financial statements do not include any adjustments to the recoverability and classification of recorded asset amounts and classification of liabilities that might be necessary should the Company be unable to continue as a going concern.
2. Summary of Significant Accounting Policies
(a)Basis of Presentation
The financial statements of the Company have been prepared in accordance with accounting principles generally accepted in the United States (“US GAAP”) and are expressed in U.S. dollars. The Company’s fiscal year end is June 30, which has been amended from September 30.
These consolidated financial statements and related notes are presented in accordance with accounting principles generally accepted in the United States and are expressed in U.S. dollars. These consolidated financial statements include the accounts of the Company and its wholly owned subsidiaries, Oroplata Exploraciones E Ingenieria SRL and LithiumOre Corporation (formerly Lithortech Resources Inc) and ABMC AG, LLC. All inter-company accounts and transactions have been eliminated on consolidation.
(b)Use of Estimates
The preparation of financial statements in conformity with US GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. The Company regularly evaluates estimates and assumptions related to the fair value of stock-based compensation, recoverability of long-lived assets, valuation of derivative liability, and deferred income tax asset valuation allowances.
The Company bases its estimates and assumptions on current facts, historical experience and various other factors that it believes to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities and the accrual of costs and expenses that are not readily apparent from other sources. The actual results experienced by the Company may differ materially and adversely from the Company’s estimates. To the extent there are material differences between the estimates and the actual results, future results of operations will be affected.
F-21
AMERICAN BATTERY METALS CORPORATION
Notes to the Consolidated Financial Statements
For the nine months ended June 30, 2020 and twelve months ended September 30, 2019
2. Summary of Significant Accounting Policies (continued)
(c)Cash and Cash Equivalents
The Company considers all highly liquid instruments with a maturity of three months or less at the time of issuance to be cash equivalents. As of June 30, 2020, and September 30, 2019, there were no cash equivalents.
(d)Long-Lived Assets
Long-lived assets, such as property and equipment, mineral properties, and purchased intangibles with finite lives (subject to amortization), are evaluated for impairment whenever events or changes in circumstances indicate that the carrying amount of the asset may not be recoverable in accordance with ASC 360, Property, Plant, and Equipment and ASC 350, Intangibles – Goodwill and Other. Circumstances which could trigger a review include, but are not limited to: significant decreases in the market price of the asset; significant adverse changes in the business climate or legal factors; accumulation of costs significantly in excess of the amount originally expected for the acquisition or construction of the asset; current period cash flow or operating losses combined with a history of losses or a forecast of continuing losses associated with the use of the asset; and current expectation that the asset will more likely than not be sold or disposed significantly before the end of its estimated useful life. The Company’s long-lived assets consist of vehicles, which is amortized on a straight-line basis over its estimated useful life of 6 years.
Recoverability of assets is measured by a comparison of the carrying amount of an asset to estimated undiscounted future cash flows expected to be generated by an asset. If the carrying amount of an asset exceeds its estimated future cash flows, an impairment charge is recognized as the amount by which the carrying amount exceeds the estimated fair value of the asset. The estimated fair value is determined using a discounted cash flow analysis. Any impairment in value is recognized as an expense in the period when the impairment occurs.
(e)Asset Retirement Obligations
The Company follows the provisions of ASC 410, Asset Retirement and Environmental Obligations, which establishes standards for the initial measurement and subsequent accounting for obligations associated with the sale, abandonment or other disposal of long-lived tangible assets arising from the acquisition, construction or development and for normal operations of such assets.
(f)Loss per Share
The Company computes net income (loss) per share in accordance with ASC 260, Earnings per Share. ASC 260 requires presentation of both basic and diluted earnings per share (“EPS”) on the face of the income statement. Basic EPS is computed by dividing net income (loss) available to common shareholders (numerator) by the weighted average number of shares outstanding (denominator) during the period. Diluted EPS gives effect to all dilutive potential common shares outstanding during the period using the treasury stock method and convertible preferred stock using the if-converted method. In computing diluted EPS, the average stock price for the period is used in determining the number of shares assumed to be purchased from the exercise of stock options or warrants. Diluted EPS excludes all dilutive potential shares if their effect is anti-dilutive. At June 30, 2020, the Company has 8,603,112 (September 30, 2019 – 20,094,150) potentially dilutive shares.
(g)Foreign Currency Translation
The Company’s functional and reporting currency is the United States dollar. Foreign currency transactions are primarily undertaken in Canadian dollars. Foreign currency transactions are translated to United States dollars in accordance with ASC 830, Foreign Currency Translation Matters, using the exchange rate prevailing at the balance sheet date.
Gains and losses arising on translation or settlement of foreign currency denominated transactions or balances are included in the determination of income.
(h)Comprehensive Loss
ASC 220, Comprehensive Income, establishes standards for the reporting and display of comprehensive loss and its components in the financial statements. As at June 30, 2020 and September 30, 2019, the Company has no items representing comprehensive income or loss.
F-22
AMERICAN BATTERY METALS CORPORATION
Notes to the Consolidated Financial Statements
For the nine months ended June 30, 2020 and twelve months ended September 30, 2019
2. Summary of Significant Accounting Policies (continued)
(i)Revenue Recognition
Revenue from the sale of minerals will be recognized in accordance with ASC 606, Revenue from Contracts with Customers, when a contract is in place and minerals are delivered to the customer.
(j)Financial Instruments
Pursuant to ASC 820, Fair Value Measurements and Disclosures, an entity is required to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. ASC 820 establishes a fair value hierarchy based on the level of independent, objective evidence surrounding the inputs used to measure fair value. A financial instrument’s categorization within the fair value hierarchy is based upon the lowest level of input that is significant to the fair value measurement. ASC 820 prioritizes the inputs into three levels that may be used to measure fair value:
Level 1
Level 1 applies to assets or liabilities for which there are quoted prices in active markets for identical assets or liabilities.
Level 2
Level 2 applies to assets or liabilities for which there are inputs other than quoted prices that are observable for the asset or liability such as quoted prices for similar assets or liabilities in active markets; quoted prices for identical assets or liabilities in markets with insufficient volume or infrequent transactions (less active markets); or model-derived valuations in which significant inputs are observable or can be derived principally from, or corroborated by, observable market data.
Level 3
Level 3 applies to assets or liabilities for which there are unobservable inputs to the valuation methodology that are significant to the measurement of the fair value of the assets or liabilities.
The Company’s financial instruments consist principally of cash, accounts payable and accrued liabilities, amounts due to related parties, derivative liabilities, and notes payable. Pursuant to ASC 820, the fair value of cash is determined based on “Level 1” inputs, which consist of quoted prices in active markets for identical assets and derivative liabilities is determined based on “Level 3” inputs, which consists of unobservable inputs to the valuation methodology that are significant to the measurement of the fair value of the liabilities. Refer to Note 7. The recorded values of all other financial instruments approximate their current fair values because of their nature and respective maturity dates or durations.
(k)Income Taxes
The Company accounts for income taxes using the asset and liability method in accordance with ASC 740, Accounting for Income Taxes. The asset and liability method provides that deferred tax assets and liabilities are recognized for the expected future tax consequences of temporary differences between the financial reporting and tax bases of assets and liabilities, and for operating loss and tax credit carryforwards.
Deferred tax assets and liabilities are measured using the currently enacted tax rates and laws that will be in effect when the differences are expected to reverse. The Company records a valuation allowance to reduce deferred tax assets to the amount that is believed more likely than not to be realized.
Due to the Company’s net loss position from inception on October 6, 2011 to June 30, 2020, there was no provision for income taxes recorded. As a result of the Company’s losses to date, there exists doubt as to the ultimate realization of the deferred tax assets. Accordingly, a valuation allowance equal to the total deferred tax assets has been recorded at June 30, 2020.
F-23
AMERICAN BATTERY METALS CORPORATION
Notes to the Consolidated Financial Statements
For the nine months ended June 30, 2020 and twelve months ended September 30, 2019
2. Summary of Significant Accounting Policies (continued)
(l)Stock-based Compensation
The Company records stock-based compensation in accordance with ASC 718, Compensation – Stock Compensation using the fair value method. All transactions in which goods or services are the consideration received for the issuance of equity instruments are accounted for based on the fair value of the consideration received or the fair value of the equity instrument issued, whichever is more reliably measurable. Equity instruments issued to employees and the cost of the services received as consideration are measured and recognized based on the fair value of the equity instruments issued. As at June 30, 2020 and September 30, 2019, the Company did not grant any stock options.
(m)Mineral Property Costs
Mineral property acquisition costs are capitalized as incurred. Exploration and evaluation costs are expensed as incurred until proven and probable reserves are established. The Company assesses the carrying costs for impairment under ASC 360, Property, Plant, and Equipment at each fiscal quarter end. When it has been determined that a mineral property can be economically developed as a result of establishing proven and probable reserves, the costs then incurred to develop such property, are capitalized. Such costs will be amortized using the units-of-production method over the estimated life of the probable reserve. If mineral properties are subsequently abandoned or impaired, any capitalized costs will be charged to operations.
(n)Advertising and Marketing Costs
The Company expenses advertising and marketing development costs as incurred.
(o)Recent Accounting Pronouncements
In February 2016, Topic 842, Leases, was issued to replace the leases requirements in Topic 840, Leases. The main difference between previous GAAP and Topic 842 is the recognition of lease assets and lease liabilities by lessees for those leases classified as operating leases under previous GAAP. A lessee should recognize in the balance sheet a liability to make lease payments (the lease liability) and a right-of-use asset representing its right to use the underlying asset for the lease term. For leases with a term of 12 months or less, a lessee is permitted to make an accounting policy election by class of underlying asset not to recognize lease assets and lease liabilities. If a lessee makes this election, it should recognize lease expense for such leases generally on a straight-line basis over the lease term.
The accounting applied by a lessor is largely unchanged from that applied under previous GAAP. Topic 842 was effective for annual reporting periods beginning after December 15, 2018, including interim periods within those annual periods and is to be retrospectively applied. Earlier application is permitted. The Company adopted the standard on October 1, 2019. The adoption of this standard did not have a material impact on the Company´s consolidated financial statements.
The Company has implemented all new accounting pronouncements that are in effect. These pronouncements did not have any material impact on the financial statements unless otherwise disclosed, and the Company does not believe that there are any other new accounting pronouncements that have been issued that might have a material impact on its financial position or results of operations.
F-24
AMERICAN BATTERY METALS CORPORATION
Notes to the Consolidated Financial Statements
For the nine months ended June 30, 2020 and twelve months ended September 30, 2019
3. Convertible Notes Payable
|
June 30,
2020
$
|
September 30,
2019
$
|
Crown Bridge Partners, LLC, $55,000 on January 2, 2019, unsecured, bears interest at 10% per annum, due on January 2, 2020, convertible into common stock 65% of the lowest trading price for the twenty trading days prior to conversion, unamortized discount of $nil (2019 - $32,538)
|
-
|
5,087
|
|
|
|
GS Capital Partners, LLC, $54,000 on January 3, 2019, unsecured, bears interest at 10% per annum, due on January 3, 2020, convertible into common stock at 66% of the lowest trading price in the twenty trading days prior to conversion, unamortized discount of $nil (2019 - $173)
|
-
|
6,061
|
|
|
|
GS Capital Partners, LLC, $220,000 on January 9, 2019, unsecured, bears interest at 10% per annum, due on January 9, 2020, convertible into common stock at 66% of the lowest trading price in the twenty trading days prior to conversion, unamortized discount of $nil (2019 - $21,451)
|
-
|
33,549
|
|
|
|
Eagle Equities, LLC, $220,000 on January 9, 2019, unsecured, bears interest at 10% per annum, due on January 9, 2020, convertible into common stock at 66% of the lowest trading price in the twenty trading days prior to conversion, unamortized discount of $nil (2019 - $44,946)
|
-
|
55,054
|
F-25
AMERICAN BATTERY METALS CORPORATION
Notes to the Consolidated Financial Statements
For the nine months ended June 30, 2020 and twelve months ended September 30, 2019
3. Convertible Notes Payable (continued)
|
June 30,
2020
$
|
September 30,
2019
$
|
GS Capital Partners, LLC, $270,000 on March 18, 2019, unsecured, bears interest at 10% per annum, due on March 18, 2020, convertible into common stock at 68% of the lowest trading price in the twenty trading days prior to conversion, unamortized discount of $nil (2019 - $236,736)
|
-
|
33,264
|
|
|
|
Eagle Equities, LLC, $270,000 on March 18, 2019, unsecured, bears interest at 10% per annum, due on March 18, 2020, convertible into common stock at 68% of the lowest trading price in the twenty trading days prior to conversion, unamortized discount of $nil (2019 - $236,736)
|
-
|
33,264
|
|
|
|
BHP Capital NY Inc, $38,500 on April 8, 2019, unsecured, bears interest at 10% per annum which increases to 24% per annum on default, due on January 8, 2020, convertible into common stock at 68% of the lowest trading price in the twenty trading days prior to conversion, unamortized discount of $nil (2019 - $33,292)
|
-
|
5,208
|
|
|
|
Jefferson Street Capital, LLC, $38,500 on April 8, 2019, unsecured, bears interest at 10% per annum which increases to 24% per annum on default, due on January 8, 2020, convertible into common stock at 68% of the lowest trading price in the twenty trading days prior to conversion, unamortized discount of $nil (2019 - $33,292)
|
-
|
5,208
|
|
|
|
Eagle Equities, LLC, $325,000 on May 1, 2019, unsecured, bears interest at 10% per annum, due on May 1, 2020, convertible into common stock at 68% of the lowest trading price in the twenty trading days prior to conversion, unamortized discount of $nil (2019 - $302,195)
|
-
|
22,805
|
|
|
|
GS Capital Partners, LLC, $325,000 on May 1, 2019, unsecured, bears interest at 10% per annum, due on May 1, 2020, convertible into common stock at 68% of the lowest trading price in the twenty trading days prior to conversion, unamortized discount of $nil (2019 - $302,195)
|
-
|
22,805
|
|
|
|
GS Capital Partners, LLC, $325,000 on May 29, 2019, unsecured, bears interest at 10% per annum, due on May 29, 2020, convertible into common stock at 68% of the lowest trading price in the twenty trading days prior to conversion, unamortized discount of $nil (2019 - $308,274)
|
-
|
16,726
|
|
|
|
Power Up Lending Group Ltd, $55,000 on June 3, 2019, unsecured, bears interest at 10% per annum which increases to 22% per annum on default, due on March 30, 2020, convertible into common stock at 61% of the lowest trading price in the ten trading days prior to conversion, unamortized discount of $nil (2019 - $51,512)
|
-
|
3,488
|
|
|
|
Crossover Capital Fund I, LLC, $105,000 on June 11, 2019, unsecured, bears interest at 10% per annum, due on June 11, 2020, convertible into common stock at 68% of the lowest trading price in the twenty trading days prior to conversion, unamortized discount of $nil (2019 - $69,142)
|
-
|
35,858
|
F-26
AMERICAN BATTERY METALS CORPORATION
Notes to the Consolidated Financial Statements
For the nine months ended June 30, 2020 and twelve months ended September 30, 2019
3. Convertible Notes Payable (continued)
|
June 30,
2020
$
|
September 30,
2019
$
|
BHP Capital NY Inc, $55,000 on June 12, 2019, unsecured, bears interest at 12% per annum which increases to 22% per annum on default, due on March 12, 2020, convertible into common stock at 68% of the lowest trading price in the twenty trading days prior to conversion, unamortized discount of $nil (2019 - $51,925)
|
-
|
3,075
|
|
|
|
Jefferson Street Capital, LLC, $55,000 on June 12, 2019, unsecured, bears interest at 12% per annum which increases to 22% per annum on default, due on March 12, 2020, convertible into common stock at 68% of the lowest trading price in the twenty trading days prior to conversion, unamortized discount of $nil (2019 - $51,925)
|
-
|
3,075
|
|
|
|
Crown Bridge Partners, LLC, $75,000 on June 13, 2019, unsecured, bears interest at 10% per annum, due on June 13, 2020, convertible into common stock at 65% of the lowest trading price in the twenty trading days prior to conversion, unamortized discount of $nil (2019 - $72,138)
|
-
|
2,862
|
|
|
|
GS Capital Partners, LLC, $270,000 on June 21, 2019, unsecured, bears interest at 10% per annum, due on June 21, 2020, convertible into common stock at 68% of the lowest trading price in the twenty trading days prior to conversion, unamortized discount of $nil (2019 - $213,989)
|
-
|
56,011
|
|
|
|
GS Capital Partners, LLC, $98,000 on June 27, 2019, unsecured, bears interest at 10% per annum, due on June 27, 2020, convertible into common stock at 66% of the lowest trading price in the twenty trading days prior to conversion, unamortized discount of $nil (2019 - $95,308)
|
-
|
2,692
|
|
|
|
Power Up Lending Group Ltd, $58,000 on June 27, 2019, unsecured, bears interest at 12% per annum, due on June 27, 2020, convertible into common stock at 61% of the lowest trading price in the ten trading days prior to conversion, unamortized discount of $nil (2019 - $56,202)
|
-
|
1,798
|
|
|
|
Odyssey Capital, LLC, $160,000 on July 9, 2019, unsecured, bears interest at 10% per annum, due on July 9, 2020, convertible into common stock at 60% of the lowest trading price in the fifteen trading days prior to conversion, unamortized discount of $nil (2019 - $156,400)
|
-
|
3,600
|
|
|
|
Sunshine Equity Partners., $50,000 on July 11, 2019, unsecured, bears interest at 12% per annum, due on July 11, 2020, convertible into common stock at 60% of the lowest trading price in the twenty trading days prior to conversion, unamortized discount of $nil (2019 - $48,683)
|
-
|
1,317
|
|
|
|
Power Up Lending Group Ltd., $53,000 on July 29, 2019, unsecured, bears interest at 12% per annum, due on June 15, 2020, convertible into common stock at 61% of the lowest trading price in the ten trading days prior to conversion, unamortized discount of $nil (2019 - $51,922)
|
-
|
1,078
|
F-27
AMERICAN BATTERY METALS CORPORATION
Notes to the Consolidated Financial Statements
For the nine months ended June 30, 2020 and twelve months ended September 30, 2019
3. Convertible Notes Payable (continued)
|
June 30,
2020
$
|
September 30,
2019
$
|
Actus Fund, LLC, $175,000 on August 1, 2019, unsecured, bears interest at 10% per annum, due on August 1, 2020, convertible into common stock at 68% of the lowest closing bid in the twenty trading days prior to conversion, unamortized discount of $nil (2019 - $140,864)
|
-
|
34,136
|
|
|
|
Adar Alef, LLC, $105,000 on August 8, 2019, unsecured, bears interest at 10% per annum, due on August 8, 2020, convertible into common stock at 60% of the lowest trading price in the fifteen trading days prior to conversion, unamortized discount of $nil (2019 - $103,483)
|
-
|
1,517
|
|
|
|
Black Ice Advisors, LLC, $105,000 on August 12, 2019, unsecured, bears interest at 10% per annum, due on August 12, 2020, convertible into common stock at 60% of the lowest trading price in the fifteen trading days prior to conversion, unamortized discount of $nil (2019 - $103,600)
|
-
|
1,400
|
|
|
|
BHP Capital NY Inc., $35,200 on August 28, 2019, unsecured, bears interest at 12% per annum, due on May 28, 2020, convertible into common stock at 62% of the lower of the lowest trading price of the Company’s common stock in the twenty trading days prior to the date of conversion and the lowest trading price of the Company’s common stock in the twenty days prior to the date of issuance, unamortized discount of $nil (2019 - $34,825)
|
-
|
375
|
|
|
|
Jefferson Street, LLC, $35,200 on August 28, 2019, unsecured, bears interest at 12% per annum, due on May 28, 2020, convertible into common stock at 68% of the lower of the lowest trading price of the Company’s common stock in the twenty trading days prior to the date of conversion and the lowest trading price of the Company’s common stock in the twenty days prior to the date of issuance, unamortized discount of $nil (2019 - $29,331)
|
-
|
5,869
|
|
|
|
LG Capital Funding, LLC, $110,000 on August 28, 2019, unsecured, bears interest at 10% per annum, due on May 28, 2020, convertible into common stock at 60% of the lowest trading price of the Company’s common stock in the twenty trading days prior to the date of conversion, unamortized discount of $nil (2019 - $109,022)
|
-
|
978
|
|
|
|
EMA Financial, LLC, $150,000 on September 17, 2019, unsecured, bears interest at 10% per annum, due on January 17, 2021, convertible into common at the lower of the closing common stock price and 68% of the lowest trading price in the prior twenty trading days on which at least 100 common shares of the Company were traded including the date of conversion, unamortized discount of $nil (2019 - $149,458)
|
-
|
542
|
|
|
|
Crown Bridge Partners, LLC, $150,000 on September 22, 2019, unsecured, bears interest at 10% per annum, due on September 24, 2020, convertible into common shares at the lower of the closing common stock price and 65% of the lowest trading price in the prior twenty trading days prior to the date of conversion, unamortized discount of $nil (2019 - $54,908)
|
-
|
92
|
F-28
AMERICAN BATTERY METALS CORPORATION
Notes to the Consolidated Financial Statements
For the nine months ended June 30, 2020 and twelve months ended September 30, 2019
3. Convertible Notes Payable (continued)
|
June 30,
2020
$
|
September 30,
2019
$
|
Power Up Lending Group Ltd., $48,000 on September 24, 2019, unsecured, bears interest at 12% per annum, due on September 24, 2020, convertible into common stock at the lower of the closing common stock price and 61% of the lowest trading price in the prior twenty trading days prior to the date of conversion, unamortized discount of $nil (2019 - $47,904)
|
-
|
96
|
|
|
|
Eagle Equities, LLC, $147,250 on January 31, 2020, unsecured, bears interest at 10% per annum, due on January 31, 2021, convertible into common stock at 60% of the lowest trading price in the ten trading days prior to conversion, unamortized discount of $137,038 (2019 - $nil)
|
10,212
|
-
|
|
|
|
GS Capital Partners, LLC, $147,250 on January 31, 2020, unsecured, bears interest at 10% per annum, due on January 31, 2021, convertible into common stock at 40% of the lowest trading price in the twenty trading days prior to conversion, unamortized discount of $134,584 (2019 - $nil)
|
12,666
|
-
|
|
|
|
GS Capital Partners, LLC, $177,200 on February 7, 2020, unsecured, bears interest at 10% per annum which increases to 22% per annum on default, due on February 7, 2021, convertible into common stock at 60% of the lowest trading price in the twenty trading days prior to conversion, unamortized discount of $165,770 (2019 - $nil)
|
11,430
|
-
|
|
|
|
Power Up Lending Group Ltd., $83,000 on February 14, 2020, unsecured, bears interest at 10% per annum, due on December 1, 2021, convertible into common stock at 61% of the lowest trading price in the ten trading days prior to conversion, unamortized discount of $76,662 (2019 - $nil)
|
6,338
|
-
|
|
|
|
Crown Bridge Partners, LLC, $75,000 on February 14, 2020, unsecured, bears interest at 10% per annum, due on February 14, 2021, convertible into common stock at 65% of the lower of the lowest closing bid or the lowest trading price in the twenty trading days prior to conversion, unamortized discount of $70,577 (2019 - $nil)
|
4,423
|
-
|
|
|
|
BHP Capital NY Inc., $110,000 on February 18, 2020, unsecured, bears interest at 10% per annum, due on February 18, 2021, convertible into common stock at 61% of the lesser of: (i) lowest trading price during the previous twenty trading days before the issue date; or (ii) the lowest trading price during the twenty trading days prior to conversion, unamortized discount of $103,282
|
6,718
|
-
|
|
|
|
Jefferson Street Capital, LLC, $110,000 on February 18, 2020, unsecured, bears interest at 10% per annum, due on February 18, 2021, convertible into common stock at 61% of the lesser of: (i) the lowest trading price during the previous twenty trading days before the issue date; or (ii) the lowest trading price during the twenty trading days prior to conversion, unamortized discount of $103,818 (2019 - $nil)
|
6,182
|
-
|
|
|
|
F-29
AMERICAN BATTERY METALS CORPORATION
Notes to the Consolidated Financial Statements
For the nine months ended June 30, 2020 and twelve months ended September 30, 2019
3. Convertible Notes Payable (continued)
|
June 30,
2020
$
|
September 30,
2019
$
|
Odyssey Capital, LLC, $220,000 on February 19, 2020, unsecured, bears interest at 10% per annum, due on February 19, 2021 convertible into common stock at 60% of the lowest closing bid price for the fifteen trading days prior to conversion, unamortized discount of $205,226
|
14,774
|
-
|
|
|
|
GS Capital Partners, LLC, $520,000 on March 17, 2020, unsecured, bears interest at 10% per annum, due on March 17, 2021, convertible into common stock at 63% of the lowest trading price in the twenty trading days prior to conversion, unamortized discount of $478,979 (2019 - $nil)
|
41,021
|
-
|
|
|
|
Power Up Lending Group Ltd., $78,000 on April 6, 2020, unsecured, bears interest at 12% per annum which increases to 22% per annum on default, due on April 6, 2021, convertible into common stock at 61% of the lowest trading price in the ten trading days prior to conversion, unamortized discount of $75,816 (2019 - $nil)
|
2,184
|
-
|
|
|
|
Adar Alef, LLC, $110,000 on April 7, 2020, unsecured, bears interest at 10% per annum, due April 7, 2021, convertible into common stock at 60% of the lowest closing bid price for the fifteen trading days prior to conversion, unamortized discount of $107,464 (2019 - $nil)
|
2,536
|
-
|
|
|
|
Auctus Fund, LLC, $150,000 on April 10, 2020, unsecured, bears interest at 10% per annum which increases to 24% per annum on default, due on April 10, 2021, convertible into common stock at 68% of the lowest trading in the twenty trading days prior to conversion, unamortized discount of $146,667 (2019 - $nil)
|
3,333
|
-
|
|
|
|
Power Up Lending Group Ltd., $43,000 on April 21, 2020, unsecured, bears interest at 10% per annum which increases to 22% per annum on default, due on April 21, 2021, convertible into common stock at 61% of the lowest trading price during the ten trading days prior to conversion, unamortized discount of $42,176 (2019 - $nil)
|
824
|
-
|
|
|
|
Black Ice Advisors, LLC, $115,500 on April 22, 2020, unsecured, bears interest at 10% per annum, due on April 22, 2021, convertible into common stock at 60% of the lowest closing bid price for the fifteen trading days prior to conversion, unamortized discount of $113,318 (2019 - $nil)
|
2,182
|
-
|
|
|
|
Efrat Investments, LLC, $125,000 on April 23, 2020, unsecured, bears interest at 10% per annum, due on April 23, 2021, convertible into common stock at 60% of the lowest closing bid price for the fifteen trading days prior to conversion, unamortized discount of $122,674 (2019 - $nil)
|
2,326
|
-
|
|
|
|
|
127,149
|
398,890
|
F-30
AMERICAN BATTERY METALS CORPORATION
Notes to the Consolidated Financial Statements
For the nine months ended June 30, 2020 and twelve months ended September 30, 2019
4. Equipment
|
Vehicle
$
|
Cost:
|
|
|
|
Balance, September 30, 2018 and 2019
|
-
|
Additions
|
61,916
|
|
|
Balance, June 30, 2020
|
61,916
|
|
|
Accumulated Depreciation:
|
|
|
|
Balance, September 30, 2018 and 2019
|
-
|
Additions
|
3,110
|
|
|
Balance, June 30, 2020
|
3,110
|
Carrying Amounts:
|
|
|
|
Balance, September 30, 2019
|
-
|
|
|
Balance, June 30, 2020
|
58,806
|
5. Related Party Transactions
(a)As of June 30, 2020, the Company owes $120,146 (September 30, 2019 - $120,146) to the former Chief Executive Officer and Director of the Company for advances to the Company to fund day-to-day operations. The amounts owing are unsecured, non-interest bearing, and due on demand.
(b)As of June 30, 2020, the Company owes $85,500 (September 30, 2019 - $85,500) to the former Chief Executive Officer and Director of the Company for advances to the Company to fund day-to-day operations and accrued management fees. The amounts owing are unsecured, non-interest bearing, and due on demand.
(c)As of June 30, 2020, the Company owes $388,577 (September 30, 2019 - $221,897) to the Chief Executive Officer of the Company for accrued management fees. The amounts owing are unsecured, non-interest bearing, and due on demand.
(d)As of June 30, 2020, the Company owes $30,726 (September 30, 2019– $30,726) to directors of the Company for accrued management fees. The amounts owing are unsecured, non-interest bearing, and due on demand.
6. Investment in Joint Venture
On October 8, 2018, the Company entered into a joint venture agreement with CINC Industries Inc. (“CINC”), a non-related Nevada company, for a period of five years whereby the joint venture will propagate the sale of a new process for extraction of lithium salt from salt brine solutions using CINC’s existing and future processing equipment. As part of the joint venture, each of CINC and the Company holds a 50% interest in the joint venture.
CINC is responsible for completing testing on the pilot project, providing training to the Company for use of its processing equipment, manufacturing up to 20 test units, and support and product development, as well as shared costs on other personnel utilized in the joint venture company. The Company is responsible for the initial funding for all equipment and associated expenses, the cost of the lease space, and marketing and sales of the joint venture agreement.
F-31
AMERICAN BATTERY METALS CORPORATION
Notes to the Consolidated Financial Statements
For the nine months ended June 30, 2020 and twelve months ended September 30, 2019
6. Investment in Joint Venture (continued)
The joint venture is committed to acquiring a minimum amount of processing equipment, goods, accessories, and/or materials totaling: (i) $1,000,000 by October 8, 2020; (ii) $3,000,000 by October 8, 2021; (iii) $6,000,000 by October 8, 2022; and (v) $10,000,000 by October 8, 2023. In the event that the joint venture fails to meet the minimum amounts above, the Company will lose the exclusive right to market, promote and sell the processing equipment provided by CINC. As part of the joint venture agreement, the Company issued 250,000 common shares to CINC. Refer to Note 9.
7. Derivative Liabilities
The Company records the fair value of the conversion price of the convertible debentures as disclosed in Note 3 in accordance with ASC 815, Derivatives and Hedging. The fair value of the derivatives was calculated using a multi-nominal lattice model. The fair value of the derivative liabilities is revalued on each balance sheet date with corresponding gains and losses recorded in the consolidated statement of operations. For the nine months ended June 30, 2020, the Company recorded a loss on the change in the fair value of derivative liability of $5,863,127 (year ended September 30, 2019 - $218,922). As at June 30, 2020, the Company recorded a derivative liability of $4,519,654 (September 30, 2019 - $3,437,200). The following inputs and assumptions were used to value the derivative liabilities outstanding during the periods ended June 30, 2020 and September 30, 2019:
|
June 30,
2020
|
September 30,
2019
|
|
|
|
Expected volatility
|
158-240%
|
75-151%
|
Risk free rate
|
0.16%
|
1.75%
|
Expected life (in years)
|
0.5-1.0
|
0.2-1.0
|
A summary of the activity of the derivative liability is shown below:
|
$
|
Balance, September 30, 2018
|
800,973
|
Derivative additions associated with convertible notes
|
3,772,666
|
Adjustment for conversion/prepayment
|
(1,355,361)
|
Mark-to-market adjustment
|
218,922
|
|
|
Balance, September 30, 2019
|
3,437,200
|
Derivative additions associated with convertible notes
|
2,591,119
|
Adjustment for conversion/prepayment
|
(7,371,792)
|
Mark to market adjustment
|
5,863,127
|
|
|
Balance, June 30, 2020
|
4,519,654
|
8. Loans Payable
(a)On January 27, 2020, the Company entered into a finance loan agreement relating to the acquisition of a company vehicle. Under the terms of the finance loan, the Company will make monthly installment payments of $1,089 at a finance loan interest rate of 7.99% per annum, which is due in February 2026. As of June 30, 2020, the Company owed $59,236 (September 30, 2019 - $nil) on the finance loan, including $8,580 (September 30, 2019 - $nil) which is due in the next twelve months.
(b)On May 7, 2020, the Company received $255,992 from the U.S. Small Business Administration as part of the Coronavirus Aid, Relief and Economic Security (“CARES”) Act Paycheck Protection Program. The amount is unsecured, bears interest at 1% per annum, is payable monthly commencing on November 7, 2020, and is due on May 7, 2022. The terms of the loan provide that certain amounts may be forgiven if the funds are used for qualifying expenses as described in the CARES Act.
F-32
AMERICAN BATTERY METALS CORPORATION
Notes to the Consolidated Financial Statements
For the nine months ended June 30, 2020 and twelve months ended September 30, 2019
9. Common Shares
The Company’s authorized common stock consists of 1,200,000,000 shares of common stock, with par value of $0.001, and authorized Series A preferred stock of 500,000 shares of preferred stock, with par value of $0.001.
Period ended June 30, 2020
On October 1, 2019, the Company issued 300,000 Series A preferred stock to officers and directors of the Company for no consideration. The preferred stock has no conversion rights, not entitled to receive dividends, carries voting rights of 1,000 votes per share of preferred stock, and is redeemable at the option of the Company at par value of $0.001 per share.
On October 3, 2019, the Company issued 917,777 common shares with a fair value of $49,560 for the conversion of $30,000 of notes payable, $2,225 of accrued interest, and $23,675 of derivative liability resulting in a gain on settlement of debt of $6,340.
On October 8, 2019, the Company issued 577,496 common shares with a fair value of $31,185 for the conversion of $15,000 of notes payable, $500 of fees, and $17,800 of derivative liability resulting in a gain on settlement of debt of $2,115.
On October 10, 2019, the Company issued 2,036,114 common shares with a fair value of $97,733 for the conversion of $55,000 of notes payable, $4,129 of accrued interest, and $47,710 of derivative liability resulting in a gain on settlement of debt of $9,106.
On October 15, 2019, the Company issued 465,723 common shares with a fair value of $29,341 for the conversion of $12,000 of notes payable, $500 of fees, and $18,440 of derivative liability resulting in a gain on settlement of debt of $1,599.
On October 17, 2019, the Company issued 502,980 common shares with a fair value of $25,149 for the conversion of $13,000 of notes payable, $500 of fees, and $13,747 of derivative liability resulting in a gain on settlement of debt of $2,098.
On October 18, 2019, the Company issued 1,113,981 common shares with a fair value of $54,028 for the conversion of $30,000 of notes payable, $2,350 of accrued interest, and $27,088 of derivative liability resulting in a gain on settlement of debt of $5,410.
On October 21, 2019, the Company issued 542,526 common shares with a fair value of $29,242 for the conversion of $12,000 of notes payable, $500 of fees, $2,061 of accrued interest, and $16,874 of derivative liability resulting in a gain on settlement of debt of $2,193.
On October 25, 2019, the Company issued 559,768 common shares with a fair value of $27,429 for the conversion of $14,500 of notes payable, $500 of fees, $24 of accrued interest, and $15,781 of derivative liability resulting in a gain on settlement of debt of $3,376.
On October 25, 2019, the Company issued 481,557 common shares with a fair value of $23,596 for the conversion of $10,500 of notes payable, $500 of fees, $1,925 of accrued interest and $13,570 of derivative liability resulting in a gain on settlement of debt of $2,899.
On October 28, 2019, the Company issued 2,996,985 common shares for the exercise of cashless warrants.
On October 30, 2019, the Company issued 744,949 common shares with a fair value of $36,503 for the conversion of $20,000 of notes payable, $1,633 of accrued interest, and $19,841 of derivative liability resulting in a gain on settlement of debt of $4,972.
On October 31, 2019, the Company issued 500,000 common shares with a fair value of $24,500 for the conversion of $9,500 of notes payable, $500 of fees, and $16,152 of derivative liability resulting in a gain on settlement of debt of $1,652.
On November 4, 2019, the Company issued 820,497 common shares with a fair value of $33,640 for the conversion of $20,000 of notes payable, $1,661 of accrued interest and derivative liability of $17,362 resulting in a gain on settlement of debt of $5,383.
On November 8, 2019, the Company issued 815,396 common shares with a fair value of $35.877 for the conversion of $6,234 of notes payable, $1,645 of accrued interest, $13,647 of finance penalties, and $19,231 of derivative liability resulting in a gain on settlement of debt of $4,880.
F-33
AMERICAN BATTERY METALS CORPORATION
Notes to the Consolidated Financial Statements
For the nine months ended June 30, 2020 and twelve months ended September 30, 2019
9. Common Shares (Continued)
On November 8, 2019, the Company issued 5,560,000 common shares with a fair value of $233,520 for consulting services including 1,000,000 common shares with a fair value of $42,000 to a director of the Company.
On November 12, 2019, the Company issued 972,587 common shares with a fair value of $39,876 for the conversion of $25,000 of notes payable, $1,653 of accrued interest, and $20,360 of derivative liability resulting in a gain on settlement of debt of $7,137.
On November 20, 2019, the Company issued 994,354 common shares with a fair value of $35,797 for the conversion of $20,000 of notes payable, $1,367 of accrued interest, and $19,506 of derivative liability resulting in a gain on settlement of debt of $5,076.
On November 20, 2019, the Company issued 1,986,954 common shares with a fair value of $71,531 for the conversion of $40,000 of notes payable, $2,696 of accrued interest, and $37,954 of derivative liability resulting in a gain on settlement of debt of $9,119.
On November 21, 2019, the Company issued 850,000 common shares with a fair value of $34,000 for the conversion of $11,825 of notes payable, $500 of fees, and $23,375 of derivative liability resulting in a gain on settlement of debt of $1,700.
On November 29, 2019, the Company issued 996,680 common shares with a fair value of $37,874 for the conversion of $20,000 of notes payable, $1,417 of accrued interest, and $21,476 of derivative liability resulting in a gain on settlement of debt of $5,018.
On December 6, 2019, the Company issued 607,477 common shares with a fair value of $20,958 for the conversion of $13,000 of notes payable and $11,339 of derivative liability resulting in a gain on settlement of debt of $3,381.
On December 9, 2019, the Company issued 746,269 common shares with a fair value of $25,224 for the conversion of $15,000 of notes payable and $14,028 of derivative liability resulting in a gain on settlement of debt of $3,804.
On December 10, 2019, the Company issued 999,524 common shares with a fair value of $32,984 for the conversion of $20,000 of notes payable, $1,478 of accrued interest, and $16,607 of derivative liability resulting in a gain on settlement of debt of $5,101.
On December 11, 2019, the Company issued 845,771 common shares with a fair value of $25,458 for the conversion of $17,000 of notes payable and $13,874 of derivative liability resulting in a gain on settlement of debt of $5,416.
On December 12, 2019, the Company issued 700,000 common shares with a fair value of $22,820 for the conversion of $9,650 of notes payable, $500 of fees, and $14,396 of derivative liability resulting in a gain on settlement of debt of $1,726.
On December 13, 2019, the Company issued 703,704 common shares with a fair value of $22,167 for the conversion of $10,000 of notes payable, $3,300 of accrued interest, and $12,107 of derivative liability resulting in a gain on settlement of debt of $3,240.
On December 13, 2019, the Company issued 822,281 common shares with a fair value of $25,902 for the conversion of $15,000 of notes payable, $500 of fees, and $12,103 of derivative liability resulting in a gain on settlement of debt of $1,701.
On December 16, 2019, the Company issued 2,079,180 common shares with a fair value of $62,375 for the conversion of $40,000 of notes payable, $2,981 of accrued interest, and $33,668 of derivative liability resulting in a gain on settlement of debt of $14,274.
On December 16, 2019, the Company issued 567,874 common shares with a fair value of $17,036 for the conversion of $7,000 of notes payable, $500 of fees, $2,872 of accrued interest, and $7,416 of derivative liability resulting in a gain on settlement of debt of $752.
On December 17, 2019, the Company issued 1,047,754 common shares with a fair value of $35,624 for the conversion of $20,000 of notes payable, $1,517 of accrued interest, and $16,552 of derivative liability resulting in a gain on settlement of debt of $2,444.
On December 24, 2019, the Company issued 932,920 common shares with a fair value of $38,670 for the conversion of $6,650 of notes payable, $500 of fees, and $29,558 of derivative liability resulting in a loss of settlement of debt of $1,962.
On December 24, 2019, the Company issued 1,561,157 common shares with a fair value of $64,710 for the conversion of $25,000 of notes payable, $1,646 of accrued interest, and $43,120 of derivative liability resulting in a gain on settlement of debt of $5,056.
F-34
AMERICAN BATTERY METALS CORPORATION
Notes to the Consolidated Financial Statements
For the nine months ended June 30, 2020 and twelve months ended September 30, 2019
9. Common Shares (Continued)
On December 27, 2019, the Company issued 896,925 common shares with a fair value of $30,047 for the conversion of $14,000 of notes payable, $500 of fees, $133 of accrued interest, and $16,948 of derivative liability resulting in a gain on settlement of debt of $1,535.
On December 30, 2019, the Company issued 1,164,572 common shares with a fair value of $32,608 for the conversion of $18,500 of notes payable, $500 of fees, and $14,929 of derivative liability resulting in a gain on settlement of debt of $1,321.
On January 2, 2020, the Company issued 2,316,826 common shares with a fair value of $81,090 for the conversion of $40,000 of note payable, $3,167 of accrued interest, and $49,831 of derivative liability resulting in a gain on settlement of debt of $11,908.
On January 2, 2020, the Company issued 1,567,942 common shares with a fair value of $54,878 for the conversion of $25,000 of note payable, $1,708 of accrued interest, and $36,380 of derivative liability resulting in a gain on settlement of $8,210.
On January 2, 2020, the Company issued 892,857 common shares with a fair value of $31,250 for the conversion of $15,000 of note payable and $19,062 of derivative liability resulting in a gain on settlement of $2,812.
On January 3, 2020, the Company issued 1,553,815 common shares with a fair value of $49,722 for the conversion of $21,500 of note payable, $3,530 of accrued interest, $500 of fees, and $48,168 of derivative liability resulting in a gain on settlement of $2,500.
On January 3, 2020, the Company issued 2,000,000 common shares with a fair value of $64,000 for the conversion of $25,933 of note payable, $6,697 of accrued interest and $36,589 of derivative liability resulting in a gain on settlement of $5,219.
On January 3, 2020, the Company issued 892,857 common shares with a fair value of $28,572 for the conversion of $15,000 of note payable and $16,833 of derivative liability resulting in a gain on settlement of $3,261.
On January 6, 2020, the Company issued 860,000 common shares with a fair value of $25,800 for the conversion of $11,311 of note payable, $750 fees and $15,573 of derivative liability resulting in a gain on settlement of $1,834.
On January 6, 2020, the Company issued 1,264,782 common shares with a fair value of $37,944 for the conversion of $20,000 of note payable, $94 of accrued interest, $500 of fees and $19,661 of derivative liability resulting in a gain on settlement of $2,311.
On January 6, 2020, the Company issued 1,071,429 common shares with a fair value of $32,143 for the conversion of $18,000 of note payable and $17,815 of derivative liability resulting in a gain on settlement of $3,672.
On January 7, 2020, the Company issued 802,381 common shares with a fair value of $24,874 for the conversion of $10,000 of note payable, $3,622 of accrued interest and $14,098 of derivative liability resulting in a gain on settlement of $2,846.
On January 7, 2020, the Company issued 1,569,981 common shares with a fair value of $48,669 for the conversion of $25,000 of note payable, $1,743 of accrued interest and $27,445 of derivative liability resulting in a gain on settlement of $5,519.
On January 10, 2020, the Company issued 1,395,332 common shares for a fair value of $35,581 for the conversion of $20,000 of note payable, $1,014 of accrued interest and $21,671 of derivative liability resulting in a gain on settlement of $7,104.
On January 13, 2020, the Company issued 1,938,768 common shares for a fair value $52,347 for the conversion of $30,000 of note payable, $2,142 of accrued interest and $26,911 of derivative liability resulting in a gain on settlement of $6,706.
On January 14, 2020, the Company issued 1,340,000 common shares for a fair value of $45,560 for the conversion of $17,306 of note payable, $750 of fees and $31,041 of derivative liability resulting in a gain on settlement of $3,537.
On January 14, 2020, the Company issued 916,963 common shares for a fair value of $31,177 for the conversion of $14,000 of note payable, $600 of accrued interest, $500 of fees and $19,647 of derivative liability resulting in a gain on settlement of $3,570.
On January 14, 2020, the Company issued 5,021,366 common shares for a fair value of $170,726 for the conversion of $79,067 of note payable, $572 accrued interest and $114,349 of derivative liability resulting in a gain on settlement of $23,262.
F-35
AMERICAN BATTERY METALS CORPORATION
Notes to the Consolidated Financial Statements
For the nine months ended June 30, 2020 and twelve months ended September 30, 2019
9. Common Shares (Continued)
On January 15, 2020, the Company issued 1,500,000 common shares for a fair value of $100,470 for the conversion of $19,462 of note payable, $750 of fees and $100,470 of derivative liability resulting in a gain on settlement of 21,212.
On January 15, 2020, the Company issued 4,649,492 common shares for a fair value of $311,422 for the conversion of $75,000 of note payable, $5,938 of accrued interest and $247,423 derivative liability resulting in a gain on settlement of $16,939.
On January 15, 2020, the Company issued 2,805,479 common shares for a fair value of $187,911 for the conversion of $40,000 of note payable, $2,082 of accrued interest and $154,571 of derivative liability resulting in a gain on settlement of $8,742.
On January 15, 2020, the Company issued 3,232,955 common shares for a fair value of $216,543 for the conversion of $50,000 of note payable, $3,597 of accrued interest and $168,041 of derivative liability resulting in a gain on settlement of $5,095.
On January 16, 2020, the Company issued 3,233,793 common shares for a fair value of $181,093 for the conversion of $50,000, accrued interest of $3,611 and derivative liability of $132,763 resulting in a gain on settlement of $5,281.
On January 17, 2020, the Company issued 5,263,014 common shares for a fair value of $302,623 for the conversion of $75,000 of note payable, $3,945 of accrued interest and $242,111 of derivative liability resulting in a gain on settlement of $18,433.
On January 22, 2020, the Company issued 2,591,056 common shares for a fair value of $82,914 for the conversion of $40,000 of note payable, $2,956 accrued interest and $53,413 of derivative liability resulting in a gain on settlement of $13,455.
On January 23, 2020, the Company issued 1,757,077 common shares for a fair value of $70,248 for the conversion of $25,000 of note payable, $1,295 accrued interest and $52,557 of derivative liability resulting in a gain of settlement of $8,604.
On January 23, 2020, the Company issued 3,761,200 common shares with a fair value of $150,448 for consulting services.
On January 23, 2020, the Company issued 3,475,000 common shares with a fair value of $139,000 for consulting services including 1,000,000 common shares with a fair value of $40,000 to a director of the Company.
On January 27, 2020, the Company issued 4,679,001 common shares with a fair value of $170,784 for the conversion of $75,000 of note payable, $6,793 of accrued interest and $150,648 of derivative liability resulting in a gain on settlement of $61,657.
On January 27, 2020, the Company issued 2,594,407 common shares with a fair value of $94,695 for the conversion of $40,000 of note payable, $3,011 of accrued liability and $59,353 of derivative liability resulting in a gain on settlement of $7,669.
On January 30, 2020, the Company issued 2,596,417 common shares with a fair value of $84,383 for the conversion of $40,000, $2,683 of accrued interest and $50,666 of derivative liability resulting in a gain on settlement of 8,966.
On February 4, 2020, the Company issued 6,467,394 common shares with a fair value of $239,293 for the conversion of $98,000 of note payable, $5,907 of accrued interest, $105 of fees and $166,151 of derivative liability resulting in a gain on settlement of $30,870.
On February 5, 2020, the Company issued 2,503,957 common shares with a fair value of $113,930 for the conversion of $40,000 of note payable, $3,589 of accrued interest and $72,495 of derivative liability resulting in a gain on settlement of $2,154.
On February 5, 2020, the Company issued 670,000 common shares with a fair value of $30,485 for the conversion of $8,278 of note payable, $750 of fees and $22,106 of derivative liability resulting in a gain on settlement of $649.
On February 6, 2020, the Company issued 5,026,425 common shares with a fair value of $201,057 for the conversion of $78,630 of note payable, $4,375 of accrued interest and $134,206 of derivative liability resulting in a gain on settlement of $16,154.
On February 10, 2020, the Company issued 9,723,549 common shares with a fair value of $495,901 for the conversion of $150,000 of note payable, $11,096 of accrued interest, $105 of fees and $366,278 of derivative liability resulting in a gain on settlement of $31,578.
F-36
AMERICAN BATTERY METALS CORPORATION
Notes to the Consolidated Financial Statements
For the nine months ended June 30, 2020 and twelve months ended September 30, 2019
9. Common Shares (Continued)
On February 10, 2020, the Company issued 1,118,568 common shares with a fair value of $57,047 for the conversion of $20,000 of note payable and $37,087 of derivative liability resulting in a gain on settlement of $40.
On February 10, 2020, the Company issued 7,834,840 common shares with a fair value of $399,577 for the conversion of $125,000 of note payable, $14,524 of accrued interest and $269,904 of derivative liability resulting in a gain on settlement of $9,851.
On February 11, 2020, the Company issued 2,051,298 common shares with a fair value of $137,355 for the conversion of $18,641 of note payable, $4,564 of accrued interest, $1,500 of fees and $108,919 of derivative liability resulting in a gain on settlement of $3,731.
On February 12, 2020, the Company issued 1,388,889 common shares with a fair value of $83,333 for the conversion of $25,000 of note payable and $65,150 of derivative liability resulting in a gain on settlement of $6,817.
On February 14, 2020, the Company issued 2,688,172 common shares with a fair value of $161,290 for the conversion of 50,000 of note payable, $3,550 of accrued interest and $127,306 of derivative liability resulting in a gain on settlement of $19,566.
On February 19, 2020, the Company issued 9,301,308 common shares with a fair value of $836,188 for the conversion of $175,000 of note payable, $14,529 of accrued interest, $105 of fees and $238,239 of derivative liability resulting in a loss on settlement on 408,315.
On February 19, 2020, the Company issued 3,643,827 common shares with a fair value of $327,580 for the conversion of $60,000 of note payable, $5,472 of accrued interest and $327,580 of derivative liability resulting in a gain on settlement of $65,472.
On February 24, 2020, the Company issued 10,000,000 common shares with a fair value of 400,000 for consulting services including 6,000,000 common shares with a fair value of $240,000 to three directors of the Company.
On February 24, 2020, the Company issued 9,206,396 common shares with a fair value of $535,996 for the conversion of $175,000 of note payable, $12,705 of accrued interest, $105 of fees and $398,306 of derivative liability resulting in a gain on settlement of $50,120.
On February 27, 2020, the Company issued 1,313,822 common shares for the exercise of cashless warrants.
On March 1, 2020, the Company issued 2,104,577 common shares with a fair value of $99,967 for the conversion of $35,200 of note payable, $2,147 of accrued interest, $500 fees and $68,868 of derivative liability resulting in a gain on settlement of 3,748.
On March 2, 2020, the Company issued 2,049,666 common shares with a fair value of $97,359 for the conversion of $35,200 of note payable, $2,159 of accrued interest, $500 of fees and $69,374 of derivative liability resulting in a gain on settlement of $9,874.
On March 4, 2020, the Company issued 7,910,062 common shares with a fair value of $514,154 for the conversion of $150,000 of note payable, $11,635 of accrued interest, $105 of fees and $390,342 of derivative liability resulting in a gain on settlement of $37,928.
On March 24, 2020, the Company issued 5,082,065 common shares with a fair value of $193,118 for the conversion of $90,000 of note payable. $6,657 of accrued interest, $105 of fees and $127,986 of derivative liability resulting in a gain on settlement of $31,630.
On April 7, 2020, the Company issued 5,666,272 common shares with a fair value of $214,185 for the conversion of $100,000 of note payable. $7,781 of accrued interest, $105 of fees and $134,929 of derivative liability resulting in a gain on settlement of $28,630.
On April 17, 2020, the Company issued 4,545,632 common shares with a fair value of $259,101 for the conversion of $80,000 of note payable. $6,959 of accrued interest, $105 of fees and $177,250 of derivative liability resulting in a gain on settlement of $5,213.
F-37
AMERICAN BATTERY METALS CORPORATION
Notes to the Consolidated Financial Statements
For the nine months ended June 30, 2020 and twelve months ended September 30, 2019
9. Common Shares (Continued)
On April 22, 2020, the Company issued 1,544,271 common shares with a fair value of $64,859 for the conversion of $29,150 of note payable. $1,817 of accrued interest, $500 of fees and $47,556 of derivative liability resulting in a gain on settlement of $14,164.
On April 22, 2020, the Company issued 1,555,098 common shares with a fair value of $76,977 for the conversion of $29,150 of note payable. $1,827 of accrued interest, $500 of fees and $58,343 of derivative liability resulting in a gain on settlement of $12,842.
On April 29, 2020, the Company issued 2,512,923 common shares with a fair value of $150,775 for the conversion of $52,000 of note payable. $2,817 of accrued interest, $105 of fees and $115,796 of derivative liability resulting in a gain on settlement of $19,942.
On April 29, 2020, the Company issued 2,093,860 common shares for the exercise of cashless warrants.
On May 20, 2020, the Company issued 5,657,363 common shares for the exercise of cashless warrants.
On May 22, 2020, the Company issued 6,874,831 common shares with a fair value of $382,928 for consulting services and management fee.
On June 19, 2020, the Company issued 859,259 common shares for the exercise of cashless warrants.
On June 29, 2020, the Company issued 3,750,000 units for proceeds of $150,000. Each unit is comprised of one common share of the Company and 0.8 share purchase warrants where each whole share purchase warrant can be exercised into one common share of the Company at $0.15 per share until October 31, 2024.
On June 30, 2020, the Company issued 1,712,824 common shares as part of the settlement for the exercise of cashless warrants.
As at June 30, 2020, the Company received share subscriptions of $2,450,000 for the future issuance of private placement units at $0.04 per unit, where each unit is comprised of one common share of the Company and 0.8 share purchase warrants where each whole share purchase warrant can be exercised into one common share of the Company at $0.15 per share until October 31, 2024. Refer to Note 12.
Year Ended September 30, 2019
On October 8, 2018, the Company issued 2,500,000 common shares with a fair value of $357,500 for services, including 1,000,000 common shares to the Chief Executive Officer of the Company and 1,000,000 shares to a director of the Company.
On October 10, 2018, the Company issued 250,000 common shares with a fair value of $35,250 as part of the joint venture agreement with CINC.
On October 11, 2018, the Company issued 193,986 common shares with a fair value of $22,308 for the conversion of $20,000 of notes payable resulting in a loss on settlement of debt of $2,308.
On October 12, 2018, the Company issued 240,096 common shares with a fair value of $27,611 for the conversion of $20,000 of notes payable resulting in a loss on settlement of debt of $7,611.
On October 15, 2018, the Company issued 216,086 common shares with a fair value of $21,047 for the conversion of $18,000 of notes payable resulting in a loss on settlement of debt of $3,047.
On October 16, 2018, the Company issued 280,505 common shares with a fair value of $40,673 for the conversion of 20,000 of notes payable resulting in a loss on settlement of debt of $20,673.
On October 16, 2018, the Company issued 100,000 common shares with a fair value of $14,500 for consulting services.
On October 17, 2018, the Company issued 175,035 common shares with a fair value of $25,800 for the conversion of $7,800 of notes payable and $4,680 of accrued interest resulting in a loss on settlement of debt of $13,320.
F-38
AMERICAN BATTERY METALS CORPORATION
Notes to the Consolidated Financial Statements
For the nine months ended June 30, 2020 and twelve months ended September 30, 2019
9. Common Shares (Continued)
On October 19, 2018, the Company issued 550,000 common shares with a fair value of $90,750 for consulting services.
On October 23, 2018, the Company issued 150,000 common shares with a fair value of $42,000 for consulting services.
On October 25, 2018, the Company issued 869,285 common shares with a fair value of $139,086 for the conversion of $58,800 of notes payable and $3,180 of accrued interest resulting in a loss on settlement of debt of $77,106.
On October 26, 2018, the Company issued 414,785 common shares with a fair value of $66,366 for the conversion of $25,000 of notes payable and $1,281 of accrued interest resulting in a loss on settlement of debt of $40,085.
On November 7, 2018, the Company issued 443,478 common shares with a fair value of $51,000 as part of a conversion of notes payable at $0.115 per share.
On November 13, 2018, the Company issued 833,895 common shares with a fair value of $179,287 for the conversion of $50,000 of notes payable and accrued interest of $2,836 resulting in a loss on settlement of debt of $126,451.
On November 19, 2018, the Company issued 796,073 common shares with a fair value of $151,254 for the conversion of $75,000 of notes payable and accrued interest of $2,445 resulting in a loss on settlement of debt of $73,809.
On November 21, 2018, the Company issued 420,870 common shares with a fair value of $48,400 for the conversion of notes payable at $0.115 per share.
On December 18, 2018, the Company issued 448,696 common shares with a fair value of $51,600 for the conversion of notes payable at $0.115 per share.
On December 26, 2018, the Company issued 420,870 common shares with a fair value of $48,400 for the conversion of notes payable at $0.115 per share.
On January 8, 2019, the Company issued 708,006 common shares with a fair value of $207,446 upon the conversion of $75,000 of convertible notes payable $4,438 of accrued interest, and derivative liability of $138,845 resulting in a gain on settlement of debt of $10,837.
On January 11, 2019, the Company issued 12,700,000 common shares with a fair value of $4,362,320 for services, including 2,000,000 common shares with a fair value of $703,600 to the Chief Executive Officer of the Company, and 4,000,000 common shares with a fair value of $1,407,200 to directors of the Company.
On January 11, 2019, the Company issued 300,000 common shares with a fair value of $105,540 for consulting services.
On January 11, 2019, the Company issued 180,181 common shares with a fair value of $62,234 upon the conversion of $15,000 of convertible notes payable, resulting in a gain on settlement of debt of $159.
On January 14, 2019, the Company issued 180,180 common shares with a fair value of $62,234 upon the conversion of $15,000 of convertible notes payable and derivative liability of $47,316, resulting in a gain on settlement of debt of $82.
On February 7, 2019, the Company issued 434,783 common shares with a fair value of $50,000 for the conversion of $39,000 of notes payable and $11,000 of accrued interest at $0.115 per share.
On February 22, 2019, the Company issued 629,833 common shares with a fair value of $135,414 upon the conversion of $75,000 of convertible notes payable, $4,438 of accrued interest, and $59,352 of derivative liability resulting in a gain on settlement of debt of $3,376.
On February 27, 2019, the Company cancelled 10,000,000 common shares that were previously issued for consulting services.
On February 27, 2019, the Company issued 6,100,000 common shares with a fair value of $1,220,000 for consulting services, including 1,000,000 common shares with a fair value of $200,000 to a director of the Company.
F-39
AMERICAN BATTERY METALS CORPORATION
Notes to the Consolidated Financial Statements
For the nine months ended June 30, 2020 and twelve months ended September 30, 2019
9. Common Shares (Continued)
On February 28, 2019, the Company issued 750,000 common shares with a fair value of $151,500 for consulting services.
On March 19, 2019, the Company issued 110,000 common shares with a fair value of $24,090 for the conversion of $9,400 of convertible notes payable and derivative liability of $14,750, resulting in a gain on settlement of debt of $60.
On April 23, 2019, the Company issued 300,000 common shares with a fair value of $74,250 for consulting services.
On May 8, 2019, the Company issued 184,930 common shares with a fair value of $48,082 for the conversion of $18,100 of convertible notes payable, $1,742 of accrued interest, and derivative liability of $22,363, resulting in a loss on settlement of debt of $5,377.
On June 11, 2019, the Company issued 552,381 common shares with a fair value of $132,516 for the conversion of $75,000 of convertible notes payable, $3,842 of accrued interest and derivative liability of $61,803, resulting in a gain on settlement of debt of $8,129.
On June 11, 2019, the Company issued 869,565 common shares with a fair value of $100,000 as part of a conversion of notes payable at $0.115 per share.
On July 8, 2019, the Company issued 1,650,000 common shares with a fair value of $396,000 for consulting services.
On July 15, 2019, the Company issued 1,352,240 common shares with a fair value of $311,015 as part of a conversion of $190,000 of convertible notes payable, $11,192 of accrued interest and derivative liability of $133,574, resulting in a gain on settlement of debt of $23,750.
On July 19, 2019, the Company issued 1,414.000 common shares with a fair value of $162,610 as part of the conversion of $136,100 of convertible notes payable and $26,510 of accrued interest.
On July 30, 2019, the Company issued 160,552 common shares with a fair value of $27,294 for the settlement of $15,000 of convertible notes payable, conversion fees of $500, accrued interest of $9, and derivative liability of $12,388 resulting in a gain on settlement of debt of $603.
On July 31, 2019, the Company issued 129,453 common shares with a fair value of $23,302 for the settlement of $12,500 of convertible notes payable and $10,853 of derivative liability resulting in a gain on settlement of debt of $51.
On August 1, 2019, the Company issued 300,000 common shares with a fair value of $54,000 for consulting services.
On August 8, 2019, the Company issued 196,711 common shares with a fair value of $34,424 for the settlement of $20,000 of convertible notes payable, conversion fees of $500, and derivative liability of $13,998 resulting in a gain on settlement of debt of $74.
On August 12, 2019, the Company issued 167,946 common shares with a fair value of $28,551 for the settlement of $17,500 of convertible notes payable and $11,110 of derivative liability resulting in a gain on settlement of debt of $59.
On August 21, 2019, the Company issued 1,500,000 common shares with a fair value of $226,500 for consulting services including 1,000,000 common shares with a fair value of $151,000 to the Chief Executive Officer of the Company.
On August 22, 2019, the Company issued 1,233,035 common shares with a fair value of $188,038 for the conversion of $110,000 of convertible notes payable, $6,781 of accrued interest, and $76,580 of derivative liability resulting in a gain on settlement of debt of $5,223.
On August 27, 2019, the Company issued 310,606 common shares with a fair value of $34,167 for the conversion of $20,000 of convertible notes payable, conversion fees of $500, and derivative liability of $13,717 resulting in a gain on settlement of debt of $50.
F-40
AMERICAN BATTERY METALS CORPORATION
Notes to the Consolidated Financial Statements
For the nine months ended June 30, 2020 and twelve months ended September 30, 2019
9. Common Shares (Continued)
On August 27, 2019, the Company issued 303,030 common shares with a fair value of $33,333 for the conversion of $20,000 of convertible notes payable and $13,383 of derivative liability resulting in a gain on settlement of debt of $50.
On September 3, 2019, the Company issued 507,826 common shares with a fair value of $49,513 for the settlement of $30,000 of convertible notes payable, conversion fees of $500, and derivative liability of $19,078 resulting in a gain on settlement of debt of $65.
On September 3, 2019, the Company issued 249,727 common shares with a fair value of $24,348 for the settlement of $15,000 of convertible notes payable, $988 of accrued interest, and $9,149 of derivative liability resulting in a gain on settlement of debt of $789.
On September 5, 2019, the Company issued 504,919 common shares with a fair value of $40,394 for the settlement of $25,000 of convertible notes payable, $1,660 of accrued interest, and $15,344 of derivative liability resulting in a gain on settlement of debt of $1,610.
On September 6, 2019, the Company issued 388,257 common shares with a fair value of $29,090 for the settlement of $20,000 of convertible notes payable, conversion fees of $500, and derivative liability of $8,620 resulting in a gain on settlement of debt of $40.
On September 9, 2019, the Company issued 622,086 common shares with a fair value of $42,862 for the settlement of $25,000 of convertible notes payable, $1,688 of accrued interest, and $17,260 of derivative liability resulting in a gain on settlement of debt of $1,086.
On September 11, 2019, the Company issued 426,997 common shares with a fair value of $43,554 for the settlement of $15,000 of convertible notes payable, $500 of conversion fees, and $28,080 of derivative liability resulting in a gain on settlement of debt of $25.
On September 11, 2019, the Company issued 471,763 common shares with a fair value of $48,120 for the settlement of $12,500 of convertible notes payable, $500 of conversion fees, and $2,913 of accrued interest and derivative liability resulting in a loss on settlement of debt of $32,207.
On September 11, 2019, the Company issued 650,000 common shares with a fair value of $66,300 for the settlement of $17,375 of convertible notes payable, $500 of conversion fees, and $49,683 of derivative liability resulting in a gain on settlement of debt of $1,258.
On September 13, 2019, the Company issued 200,000 common shares with a fair value of $14,000 for consulting services.
On September 16, 2019, the Company issued 736,532 common shares with a fair value of $51,395 for the settlement of $30,000 of convertible notes payable, $2,100 of accrued interest, and $50,051 of derivative liability resulting in a gain on settlement of debt of $2,564.
On September 17, 2019, the Company issued 1,619,344 common shares with a fair value of $100,399 for the settlement of $55,000 of convertible notes payable, $3,782 of accrued interest, and $50,872 of derivative liability resulting in a gain on settlement of debt of $9,255.
On September 17, 2019, the Company issued 463,843 common shares with a fair value of $28,758 for the settlement of $10,000 of convertible notes payable, $500 of conversion fees, $6,338 of accrued interest, and $1,487 of derivative liability resulting in a loss on settlement of debt of $10,433.
On September 18, 2019, the Company issued 884,298 common shares with a fair value of $79,587 for the settlement of $30,000 of convertible notes payable, $2,100 of accrued interest, and $50,051 of derivative liability resulting in a gain on settlement of debt of $2,564.
F-41
AMERICAN BATTERY METALS CORPORATION
Notes to the Consolidated Financial Statements
For the nine months ended June 30, 2020 and twelve months ended September 30, 2019
10. Share Purchase Warrants
|
Number of
warrants
|
Weighted
average
exercise
price
$
|
Balance, September 30, 2018 and 2019
|
8,925,334
|
0.09
|
Issued
|
6,522,224
|
0.16
|
Exercised
|
(5,610,807)
|
0.09
|
Expired
|
(1,233,639)
|
0.09
|
|
|
|
Balance, June 30, 2020
|
8,603,112
|
0.14
|
Additional information regarding share purchase warrants as of June 30, 2020, is as follows:
|
Outstanding and exercisable
|
Range of
Exercise Prices
$
|
Number of
Warrants
|
Weighted
Average
Remaining
Contractual
Life (years)
|
0.1
|
3,250,000
|
1.1
|
0.15
|
4,500,000
|
2.2
|
0.17
|
250,000
|
0.1
|
0.18
|
361,112
|
0.1
|
0.5
|
242,000
|
0
|
|
|
|
|
8,603,112
|
3.5
|
11. Income Taxes
The Company has $24,600,000 of net operating losses carried forward to offset taxable income in future years which expire commencing in fiscal 2032. The income tax benefit differs from the amount computed by applying the US federal income tax rate at 21% per annum to net loss before income taxes. As at June 30, 2020 and September 30, 2019, the Company had no uncertain tax positions.
|
June 30,
|
September 30,
|
|
2020
|
2019
|
|
$
|
$
|
Net loss before taxes
|
13,318,408
|
12,625,204
|
Statutory rate
|
21%
|
21%
|
|
|
|
Computed expected tax recovery
|
2,796,866
|
2,651,293
|
Permanent differences and other
|
(1,437,275)
|
(396,668)
|
Change in valuation allowance
|
(1,359,591)
|
(2,254,625)
|
|
|
|
Income tax provision
|
-
|
-
|
F-42
AMERICAN BATTERY METALS CORPORATION
Notes to the Consolidated Financial Statements
For the nine months ended June 30, 2020 and twelve months ended September 30, 2019
11. Income Taxes (continued)
The significant components of deferred income tax assets and liabilities as at June 30, 2020 and September 30, 2019 after applying enacted corporate income tax rates are as follows:
|
2020
$
|
2019
$
|
Net operating losses carried forward
|
5,166,165
|
3,806,574
|
Valuation allowance
|
(5,166,165)
|
(3,806,574)
|
|
|
|
Net deferred tax asset
|
-
|
-
|
12. Subsequent Events
(a)On July 9, 2020, the Company issued 7,950,000 common shares as consideration for consulting services.
(b)On July 9, 2020, the Company issued 6,081,150 common shares pursuant to the conversion of $147,250 of convertible notes payable and $5,890 accrued interests dated June 25, 2020.
(c)On August 18, 2020, the Company issued 1,000,000 common shares as consideration for management fees and 1,890,000 common shares as consideration for marketing consulting fees.
(d)On August 26, 2020, the Company issued 2,196,822 common shares pursuant to the conversion of $100,000 convertible notes payable and $5,342 accrued interests dated August 20, 2020.
(e)On August 27, 2020, the Company issued 5,055,132 common shares pursuant to the exercise of warrants.
(f)On September 16, 2020, the Company issued 1,696,856 common shares pursuant to the conversion of $77,200 convertible notes payable and $4,653 accrued interests dated September 14, 2020.
Subsequent to June 30, 2020, the Company issued 60,625,000 common shares to various parties for proceeds of $2,425,000 received during the nine months ended June 30, 2020 as part of the private placement at $0.04 per unit. Each unit is comprised of one common share of the Company and 0.8 share purchase warrants where each whole share purchase warrant can be exercised into one common share of the Company at $0.15 per share until October 31, 2024.
F-43
PROSPECTUS
AMERICAN BATTERY METALS CORPORATION
50,000,000 SHARES OF
COMMON STOCK
TO BE SOLD BY THE SELLING STOCKHOLDER
January 7, 2021