Silver Tiger Metals Inc. — Interim / Quarterly Report 2022

Aug 31, 2021

==> picture [284 x 71] intentionally omitted <==

Interim Unaudited Condensed Consolidated Financial Statements

June 30, 2021

August 30, 2021

Management’s Report

The accompanying interim unaudited condensed consolidated financial statements of Silver Tiger Metals Inc. (the “Company”) are the responsibility of management and have been approved by the Board of Directors. The consolidated financial statements have been prepared by management in accordance with International Financial Reporting Standards (“IFRS”). The consolidated financial statements include certain amounts and assumptions that are based on management’s best estimates and have been derived with careful judgment.

In fulfilling its responsibilities, management has developed and maintains a system of internal accounting controls. These controls are designed to provide reasonable assurance that the financial records are reliable for the preparation of the consolidated financial statements. The Audit Committee of the Board of Directors reviewed and approved the Company’s consolidated financial statements and recommended their approval by the Board of Directors.

These consolidated financial statements have not been reviewed by the external auditors of the Company.

(signed) “ Glenn Jessome ” (signed) “ Glenn Holmes ” President and Chief Executive Officer Chief Financial Officer Halifax, Nova Scotia Halifax, Nova Scotia

Unaudited Interim Condensed Consolidated Statements of Financial Position

==> picture [129 x 33] intentionally omitted <==

As at June 30, 2021 and March 31, 2021

Assets Current assets Cash Sales tax recoverable Deposits and prepaid expenses Right-of-use asset Resource properties(note 5) Liabilities Current liabilities Accounts payable and accrued liabilities (note 6) Current portion of lease liability Loan payable(note 7) Equity(note 9)	June 30, 2021 $ March 31, 2021 $ 23,481,116 25,935,925 89,248 123,761 206,572 226,456
	23,776,936 26,286,142 7,500 15,200 26,777,136 25,146,210
	50,561,572 51,447,552
	1,438,192 2,095,233 7,632 15,716
	1,445,824 2,110,949 25,834 25,199
	1,471,658 2,136,148 49,089,914 49,311,404
	50,651,572 51,447,552

Commitments (note 12)

Approved by the Board of Directors

Signed “ Keith Abriel ”, Director

Signed “ Wade Anderson ”, Director

The accompanying notes are an integral part of these unaudited interim condensed consolidated financial statements.

==> picture [129 x 33] intentionally omitted <==

Unaudited Interim Condensed Consolidated Statements of Changes in Equity For the periods ended June 30, 2021 and 2020

Balance – March 31, 2021 Net loss and comprehensive loss for the period Shares issued for cash, exercise of warrants (note 9) Shares issued for cash, exercise of stock options (note 9) Stock-based compensation Balance – June 30, 2021 Balance – March 31, 2020 Net loss and comprehensive loss for the period Shares issued for cash, net of issue costs (note 9) Shares issued in settlement of accounts payable (notes 9 and 13) Stock-based compensation (note 9) Balance – June 30, 2020	Number of shares Share capital $ Contributed surplus $ Warrants $ Deficit $ Total $ 260,342,531 67,038,066 3,431,517 1,354,000 (22,512,179) 49,311,404 - - - - (376,190) (376,190) 462,000 46,200 - - - 46,200 635,000 200,500 (94,000) - - 106,500 - - 2,000 - - 2,000
	261,439,531 67,284,766 3,339,517 1,354,000 (22,888,369) 49,089,914
	162,766,353 33,056,024 2,838,517 - (19,535,004) 16,359,537 - - - - (1,597,282) (1,597,282) 7,856,429 545,787 - - - 545,787 6,535,366 1,111,012 - - - 1,111,012 - - 739,500 - - 739,500
	177,158,148 34,712,823 3,578,017 - (21,132,286) 17,158,554

The accompanying notes are an integral part of these consolidated financial statements.

==> picture [129 x 33] intentionally omitted <==

Unaudited Interim Condensed Consolidated Statements of Loss and Comprehensive Loss For the periods ended June 30, 2021 and 2020

Operating expenses Consulting fees (note 9) Depreciation Dues and fees Foreign exchange loss (gain) Insurance Office and other Professional fees Shareholder communication Stock-based compensation (note 9) Travel Wages and benefits Other expenses (income) Interest income Loss on settlement of accounts payable (note 13) Net loss and comprehensive loss for the periods Loss per share –Basic and diluted Weighted average outstanding common shares –Basic and diluted		2021 $ 2020 $ 178,945 84,549 7,700 7,700 8,158 7,925 (22,998) (29,967) 33,720 19,891 47,021 18,789 30,441 4,398 60,565 9,086 2,000 739,500 2,982 1,248 44,414 15,273
		(392,948) (878,392) 16,758 - - (718,890)
		(376,190) (1,597,282)
		(0.001) (0.009) 260,754,048 168,934,265

The accompanying notes are an integral part of these consolidated financial statements.

Unaudited Interim Condensed Consolidated Statements of Cash Flows For the periods ended December 31, 2020 and 2020

==> picture [129 x 33] intentionally omitted <==

Cash provided by (used in) Operating activities Net loss and comprehensive loss for the periods Charges to net and comprehensive loss not affecting cash Stock-based compensation Depreciation expense Interest expense - lease liability Accretion expense - loan payable Loss on settlement of accounts payable (note 13) Net changes in non-cash working capital balances related to operations Decrease (increase) in sales tax recoverable Decrease (increase) in prepaid expenses Increase in accounts payable and accrued liabilities Investing activity Expenditures on resource properties Financing activities Proceeds from issuance of common shares (note 9) Share issue costs paid (note 9) Proceeds from exercise of stock options and warrants (note 9) Loan proceeds (note 7) Repayment of lease liability Net change in cash during the periods Cash – Beginning of periods Cash – End of periods	2021 $ 2020 $ (376,190) (1,597,282) 2,000 739,500 7,700 7,700 170 600 635 - - 718,890
	(365,685) (130,592) 34,513 (813) 19,884 (38,333) (206,357) (188,108)
	(517,645) (357,846)
	(2,081,610) (11,483)
	- 549,950 - (4,163) 152,700 - - 40,000 (8,254) (8,300)
	144,446 577,487
	(2,454,809) 208,158 25,935,925 89,438
	23,481,116 297,596

The accompanying notes are an integral part of these consolidated financial statements.

Notes to Unaudited Interim Condensed Consolidated Financial Statements For the period ended June 30, 2021

==> picture [129 x 32] intentionally omitted <==

1 Nature of operations

Silver Tiger Metals Inc. (previously Oceanus Resources Corporation) (the “Company”) was incorporated under the Canada Business Corporations Act on June 14, 2010. Its common shares are listed on the TSX Venture Exchange (the “Exchange”) under the trading symbol SLVR and on the OTCQX under the trading symbol SLVTF. The Company’s registered office is located at Suite 2108, 1969 Upper Water Street, Halifax, Nova Scotia. The Company has one reportable and one geographic segment.

The Company is a mineral exploration company engaged in locating and acquiring high quality projects and exploring for silver and gold. To date, the Company has not generated any revenue and is considered to be in the exploration stage. The Company is in the process of exploring and evaluating its resource properties in Mexico. The recoverability of amounts spent for the acquisition, exploration and development of the resource properties is dependent upon the discovery of economically recoverable reserves, the ability of the Company to obtain the necessary financing to complete the exploration and development of its properties, and upon future profitable production or proceeds from the disposition of the properties. The operations of the Company will require various licenses and permits from governmental authorities which are or may be granted subject to various conditions and may be subject to renewal from time to time. There can be no assurance that the Company will be able to comply with such conditions and obtain or retain all necessary licenses and permits that may be required to carry out exploration, development and mining operations at its projects. Failure to comply with these conditions may render the licenses liable to forfeiture.

COVID-19

On March 11, 2020, the World Health Organization declared a pandemic following the emergence and rapid spread of a novel strain of coronavirus (“COVID-19”). The Company’s business could be adversely affected by the effects of the continued spread of COVID-19. Since early March 2020, significant measures have been implemented in Canada, Mexico and the rest of the world by governmental authorities in response to COVID19. The Company cannot accurately predict the impact COVID-19 will have on the ability of third parties to meet their obligations with the Company, including due to uncertainties relating to the ultimate geographic spread of the virus, the severity of the disease, the duration of the outbreak, and the length of travel and quarantine restrictions imposed by governments of affected countries. In particular, the continued spread of COVID-19 globally could materially and adversely impact the Company’s business including without limitation, employee health, limitations on travel, the availability of industry experts and personnel, restrictions on planned drill and exploration programs, and other factors that depend on future developments beyond the Company’s control. In addition, COVID-19 has resulted in a widespread health crisis that has adversely affected economies and financial markets of many countries, including Canada and Mexico, resulting in an economic downturn that may negatively impact the Company’s financial position, financial performance, cash flows and its ability to raise capital.

(1)

Notes to Unaudited Interim Condensed Consolidated Financial Statements For the period ended June 30, 2021

==> picture [129 x 32] intentionally omitted <==

1 Nature of operations (continued)

COVID-19 (continued)

Following the completion of the May 2020 private placement financing, and the Mexican Health Ministry's decree which included mining as an essential service effective June 1, 2020, the Company implemented strict COVID-19 protocols to enable the recommencement of exploration activities. Onsite accommodations and sanitation were constructed or improved to meet the higher standards of safety and medical services on site were improved, including mandatory COVID-19 testing of all persons entering the camp. The Company has created a remote isolated camp to minimize physical contact with surrounding communities. While the impact of COVID-19 is expected to be temporary, the current circumstances are dynamic and the impacts of COVID-19 on the Company’s exploration activities cannot be reasonably estimated at this time. The increase in COVID-19 cases globally may impact the Company’s operations due to additional government mandated shutdowns or closures.

2 Basis of presentation

Statement of compliance

These unaudited interim condensed consolidated financial statements have been prepared in accordance with International Financial Reporting Standards (“IFRS”) as issued by the International Accounting Standards Board (“IASB”).

These financial statements are in compliance with International Accounting Standard 34, Interim Financial Reporting (“IAS 34”). Accordingly, certain information normally included in annual financial statements prepared in accordance with IFRS, as issued by the IASB, have been omitted or condensed. The preparation of financial statements in accordance with IAS 34 requires the use of certain critical accounting estimates. It also requires management to exercise judgement in applying the Company’s accounting policies. The areas involving a higher degree of judgement or complexity, or areas where assumptions and estimates are significant to the financial statements have been set out in note 2 of the Company’s financial statements for the year ended March 31, 2021. These financial statements should be read in conjunction with the Company financial statements for the year ended March 31, 2021.

The Board of Directors approved the consolidated financial statements for issue on August 30, 2021.

Basis of measurement

These consolidated financial statements have been prepared under a historical cost basis.

(2)

Notes to Unaudited Interim Condensed Consolidated Financial Statements For the period ended June 30, 2021

==> picture [129 x 32] intentionally omitted <==

3 Significant accounting policies

These financial statements have been prepared using the same accounting policies and methods of computation as the annual financial statements of the Company for the year ended March 31, 2021. Refer to note 3 – Significant accounting policies and note 4– Amendments to accounting standards not yet adopted, of the Company’s annual consolidated financial statements for the year ended March 31, 2021, for information on accounting policies and new accounting standards not yet effective.

4 Capital management

The Company manages its capital structure and makes adjustments to it, based on the funds available to the Company. The Company considers capital to be total equity, which as at June 30, 2021 totaled $49,089,914 (March 31, 2021 – $49,311,404). The Board of Directors does not establish quantitative return on capital criteria for management, but rather relies on the expertise of the Company’s management to sustain future development of the business. The Company is not subject to externally imposed capital requirements.

5 Resource properties

Balance – March 31, 2020 Exploration and property costs incurred Balance – June 30, 2020 Balance – March 31, 2021 Exploration and property costs incurred Balance – June 30, 2021	$ 19,039,807 69,871
	19,109,678
	25,146,210 1,630,926
	26,777,136

On September 15, 2015, the Company entered into an arrangement agreement with El Tigre Silver Corp. (“El Tigre”) to combine the respective companies by way of a statutory plan of arrangement pursuant to the Business Corporations Act (British Columbia), under which the Company acquired all of the outstanding common shares of El Tigre in exchange for common shares of the Company on the basis of 0.2839 of one Company share for every one El Tigre share (the “Transaction”). The Transaction was completed on November 13, 2015.

(3)

Notes to Unaudited Interim Condensed Consolidated Financial Statements For the period ended June 30, 2021

==> picture [129 x 32] intentionally omitted <==

5 Resource properties (continued)

El Tigre holds nine Mexican Federal mining concessions, located in north-eastern Sonora State, of which eight are collectively referred to as the El Tigre Property (“El Tigre Property”). The concessions are 100% held by El Tigre through its wholly-owned subsidiaries, Pacemaker Silver Mining S.A. de C.V. and Compãnia Minera Talaman S.A. de C.V.

In 2016, the Company entered into a land access agreement with the land-owners of the El Tigre Property. Under the agreement, the Company is required to pay the land-owners USD$1,030,000, of which USD$110,000 was payable on the date of the agreement, with the remaining to be paid over an 84-month period in equal monthly instalments of USD$10,952. As at June 30,2021, there are 33 monthly payments remaining. The agreement can be terminated by the Company by issuing a written notice to the land-owners and is considered nullified if the Company does not pay the land-owners for three consecutive months. The Company will acquire 6,283 hectares of land within the boundaries of the El Tigre Property at the end of the 84month period if all required payments were made according to the agreement.

Pursuant to the land access agreement, at such time as the EL Tigre Property is put into production, the Company is required to make the following additional payments to the land-owners; US$3 per ounce of gold produced if the gold price is below US$1,200, US$5 per ounce of gold produced if the gold price is between US$1,201 and US$1,500 and US$7 per ounce of gold produced if the gold price is above US$1,501. Additionally, the Company is required to make a payment of US$500,000 to the land-owners upon establishing commercial production subject to completing the agreement. The monthly payments paid to date have been recorded to resource properties.

6 Accounts payable and accrued liabilities

Accounts payable Accrued liabilities	June 30, 2021 $ December 31, 2020 $ 1,348,522 1,915,563 89,670 179,670
	1,438,192 2,095,233

As at June 30, 2021, $4,600 (March 31, 2021 – $17,275) of accounts payable and accrued liabilities is due to the Chief Executive Officer, Chief Financial Officer and Vice President Exploration.

(4)

Notes to Unaudited Interim Condensed Consolidated Financial Statements For the period ended June 30, 2021

==> picture [129 x 32] intentionally omitted <==

7 Loan payable

On May 6, 2020, the Company received a $40,000 emergency business loan under the federal government Canada Business Emergency Account (“CEBA”) initiative. In the event the Company repays $30,000 by December 31, 2022, there will be no interest payable on the loan and the remaining $10,000 will be forgiven. In the event there is a loan balance outstanding on January 1, 2023, the loan will be renewed for a 3-year term with an annual fixed rate of interest of 5%. The Company plans to repay $30,000 before December 31, 2022. The repayment of $30,000 has been discounted as loan payable. As at June 30, 2021, the discounted loan is $25,834 (March 31, 2021 - $25,199). During the period ended June 30, 2021, the accretion on the loan payable is $635.

8 Related party transactions

Consulting services were provided during the period ended June 30, 2021 by a corporation owned by the Chief Executive Officer of the Company. The cost of these consulting services during the period was $62,500 (2020 – $62,500) related to annual contract fees and $100,000 (2020 - $nil) related to bonus payments. The Company recorded these costs to consulting fees.

Consulting services were provided during the period ended June 30, 2021 by a corporation owned by the Chief Financial Officer of the Company. The cost of these consulting services during the period was $12,000 (2020 – $12,000). The Company recorded these costs to consulting fees.

9 Shareholders’ equity

Capital stock

Authorized

Unlimited number of common shares, without nominal or par value

Issued and outstanding

Balance – March 31, 2020 Shares issued for cash, net of issue costs Shares issued in settlement of accounts payable Balance – June 30, 2020 Balance – March 31. 2021 Shares issued for cash, exercise of warrants Shares issued for cash, exercise of stock options Balance – June 30, 2021	Number of shares # Amount $ 162,766,353 33,056,024 7,856,429 545,787 6,535,366 1,111,012
	177,158,148 34,712,823
	260,342,531 67,038,066 462,000 46,200 635,000 200,500
	261,439,531 67,284,766

(5)

Notes to Unaudited Interim Condensed Consolidated Financial Statements For the period ended June 30, 2021

==> picture [129 x 32] intentionally omitted <==

9 Shareholders’ equity (continued)

Capital stock (continued)

On May 22, 2020, the Company completed a non-brokered private placement raising gross proceeds of $675,000 through the issuance of 9,642,857 units at a price of $0.07 per unit. Each unit consists of one common share and one-half common share purchase warrant. Each full common share purchase warrant entitles the subscriber to acquire one common share at a price of $0.10 until May 22, 2022. At June 30, 2020, the transfer of subscription proceeds aggregating $125,050 remained outstanding. The 1,786,424 units relating to these subscriptions were held in trust at June 30, 2020 and for accounting purposes these units were excluded from the issued number of shares and outstanding number of warrants. The capital stock value of the common shares issued as at June 30, 2020 is net of share issue costs of $4,163.

On May 22, 2020, the Company issued a total of 6,535,366 common shares to settle accounts payable of $392,122 owed to geological services and drilling companies. The difference between the fair value of the common shares issued on May 22, 2020, the date the shares were issued and liability extinguished, and the carrying amount of the accounts payable was recognized as a loss on settlement of accounts payable on the statement of loss and comprehensive loss in the amount of $718,890 (note 13).

Stock options

The Company has a common share purchase option plan (the “Plan”) for directors, officers, employees and consultants. The total number of options issued and outstanding at any time cannot exceed 10% of the issued and outstanding common shares of the Company unless shareholder and regulatory approvals are obtained. Options granted under the Plan have a ten-year term. Options are granted at a price no lower than the market price of the common shares less any discounts allowed by the Exchange at the time of the grant. In determining the stock-based compensation expense, the fair value of options issued is estimated using the Black-Scholes option pricing model. Expected volatility is based on actual volatility of similar companies.

The following weighted average assumptions were used in the Black-Scholes option pricing model for the period ended June 30, 2020:

Risk-free interest rate	2.25%
Expected volatility	105%
Expected dividend yield	–
Expected life	10 years

(6)

Notes to Unaudited Interim Condensed Consolidated Financial Statements For the period ended June 30, 2021

==> picture [129 x 32] intentionally omitted <==

9 Shareholders’ equity (continued)

Stock options (continued)

The following table summarizes the changes in the Company’s stock options during the periods ended June 30, 2021 and 2020:

Weighted Average Exercise price $ Balance – March 31, 2020 0.20 Granted during the period 0.17 Balance – June 30, 2020 0.20 Balance – March 31, 2021 0.20 Exercised during the period 0.17 Balance – June 30, 2021 0.20	Number of options # Weighted average remaining life (years) 14,040,000 3,275,000 17,315,000 5.2 15,890,000 (635,000) 15,255,000 5.5

As at June 30, 2021, 10,888,953 options remained available for future grants under the Plan. Options vested and exercisable as at June 30, 2021 totaled 15,255,000 with an average exercise price of $0.20 per share.

Contributed surplus

Balance – March 31, 2020 Stock-based compensation Balance – June 30, 2020 Balance – March 31, 2021 Exercise of stock options Stock-based compensation related to stock options Balance – June 30 2021	$ 2,838,517 739,500
	3,578,017
	3,431,517 (94,000) 2,000
	3,339,517

(7)

Notes to Unaudited Interim Condensed Consolidated Financial Statements For the period ended June 30, 2021

==> picture [129 x 32] intentionally omitted <==

9 Shareholders’ equity (continued)

Warrants

The following table summarizes the changes in the Company’s warrants for the periods ended June 30, 2021 and 2020:

Expiry date Exercise price $ Balance – March 31, 2020 Sept 17, 2020 0.17 Warrants issued pursuant to May 2020 private placement financing May 22, 2022 0.10 Balance – June 30, 2020 Balance – March 31, 2021 Warrants exercised during the period 0.10 Balance – June 30, 2021	Number Ascribed value $ 2,884,612 - 3,928,214 -
	6,812,826 -
	25,366,407 1,354,000 - (462,000) -
	24,904,407 1,354,000

The fair value of the warrants issued pursuant to the May 2020 private placement financing have an estimated value of $nil as at the issue date using the residual method of valuation.

Deferred share units

The Company has a deferred share unit plan (the “DSU Plan”) whereby Participants may elect to receive all or a portion of their annual compensation or bonus compensation, if any, in deferred share units (“DSUs”). The election, if it is made, must be for a minimum of 10%, or a multiple thereof, of such compensation in DSUs. The number of DSUs received is equal to the amount of compensation elected to be received in DSUs, divided by the volume-weighted average trading price of the common shares on the TSX for the 5 trading days immediately prior to the payment date. DSUs awarded under the DSU Plan in lieu of annual or bonus compensation will vest immediately.

In addition, the Board of Directors has the authority to make discretionary awards of DSU’s to Participants under the DSU Plan. DSUs granted pursuant to discretionary awards will vest in accordance with the vesting schedule determined by the Board of Directors. Generally, DSUs will vest equally over three years, with onethird of the awarded DSUs vesting on each of the first, second and third anniversaries of the date of the award.

All unvested DSUs will vest immediately in the case of a change of control of the Company. In addition, in the event of the death or termination without cause of a Participant that received DSUs, the Participant’s DSUs will vest immediately. The Board of Directors may at any time shorten the vesting period of any or all DSUs.

(8)

Notes to Unaudited Interim Condensed Consolidated Financial Statements For the period ended June 30, 2021

==> picture [129 x 32] intentionally omitted <==

9 Shareholders’ equity (continued)

Deferred share units (continued)

The maximum number of common shares issuable under the DSU Plan is 10,000,000. Each DSU held by a Participant must be redeemed by the Company within 10 years of the grant for DSU Plan shares issued from treasury. Each vested DSU held by a Participant who ceases to be an eligible employee, director or officer shall be redeemed by the Company effective as at the separation date for DSU Plan shares issued from treasury.

The fair value of the DSU’s is determined based on the Company’s trading price of its common shares on the day of the grant.

On May 22, 2020, the Board of Directors approved the issuance of 1,450,000 DSUs to officers and an employee of the Company. The 1,450,000 DSU’s vest immediately and the grant date fair value amounted to $225,000.

The Company recognized $2,000 in stock-based compensation expense to the consolidated statement of loss and comprehensive loss for the period ended June 30, 2021, in relation to the outstanding DSUs.

10 Supplemental cash flow information

As at June 30, 2021, the Company’s accounts payable included expenditures on resource properties of $972,504 (March 31, 2020 – $1,423,189).

11 Financial instruments and other

Credit risk

The Company manages credit risk by holding its cash and cash equivalents with high quality financial institutions in Canada, where management believes the risk of loss to be low. The Company also has approximately $1.3 million of Mexican VAT receivable as at June 30, 2021. The Company has recorded the VAT to resource properties. While the Company is still pursuing collection, with the delay in processing and collection, management determined that it was appropriate to reclassify this amount to the resource property to which the VAT paid is related. The timing and amount of the VAT ultimately collectible could be materially different from the amount recorded in the consolidated financial statements.

Liquidity risk

Liquidity risk is the risk that the Company will encounter difficulty in meeting the obligations associated with its financial liabilities that are settled by delivering cash or another financial asset. The Company’s approach to managing liquidity is to ensure, as far as possible, that it will always have sufficient liquidity to meet its liabilities when due, under both normal and stressed conditions.

(9)

Notes to Unaudited Interim Condensed Consolidated Financial Statements For the period ended June 30, 2021

==> picture [129 x 32] intentionally omitted <==

11 Financial instruments and other (continued)

Liquidity risk (continued)

Management concluded that the Company has sufficient cash on hand to meet its obligations as they become due for the next twelve months, considering the Company’s planned exploration and development activities on its resource properties. The Company has the ability to scale its exploration and development activities, and will do so as necessary, based on cash availability. The Company will need to raise further financing to fund future additional exploration and development activities.

Market risk

Market risk is the risk of loss that may arise from changes in market factors such as interest rates, foreign exchange rates and commodity and equity prices.

• a) Interest rate risk

The Company has no interest-bearing debt, except for the loan payable (note 8), and is not exposed to any significant interest rate risk.

b) Foreign currency risk

The Company operates in Mexico, giving rise to foreign currency risk. To limit the Company’s exposure to this risk, cash is primarily held with high quality financial institutions in Canada.

As at June 30, 2021, the Company held the following financial instruments in foreign currencies:

	US$	Pesos
Cash	6,912	378,332
Accounts payable and accrued liabilities	521,296	5,281,432

c) Price risk

The Company is not exposed to any direct price risk other than that associated with commodities and how fluctuations impact companies in the mineral exploration and mining industries as the Company has no significant revenues.

(10)

Notes to Unaudited Interim Condensed Consolidated Financial Statements For the period ended June 30, 2021

==> picture [129 x 32] intentionally omitted <==

12 Commitments

The minimum annual payments in relation to the Company’s El Tigre Agreement (note 6) are as follows:

$

Year ending March 31, 2022 165,271 2023 165,271 2024 165,271

13 Accounts payable settlement adjustment

The unaudited interim condensed consolidated financial statements for the three-months period ended June 30, 2020 reported the issuance of 6,535,366 common shares pursuant to agreements to settle $392,122 of accounts payable. The number of common shares issued to settle these accounts payable was agreed upon when the Company’s share price was $0.06 and accounted for at such value in the June 30, 2020 unaudited interim condensed consolidated financial statements. The common shares were issued on May 22, 2020, following regulatory approval, and the accounts payable were extinguished. The common shares should have been recognized at the trading price on the date of issuance, which was $0.17, and the difference between the carrying amounts of the extinguished liability and the common shares recognized as gain or loss through the statement of loss and comprehensive loss. The adjustment has been reflected in the comparative amounts in these unaudited interim condensed consolidated financial statements. The effects of the non-cash adjustments to the unaudited interim condensed consolidated financial statements as at June 30, 2020 and for the threemonth period then ended are as follows:

Adjustment to the unaudited interim condensed consolidated statement of changes in equity:

		As at June 30, 2020
	Previously stated	Adjustment	Adjusted
	$	$	$
Share capital	33,993,933	718,890	34,712,823
Deficit	(20,413,396)	(718,890)	(21,132,286)

Adjustments to unaudited interim condensed consolidated statement of loss and comprehensive loss:

		As at June 30, 2020
	Previously stated	Adjustment	Adjusted
	$	$	$
Loss on settlement of accounts payable	-	718,890	(718,890)
Net loss and comprehensive loss for the period	(878,392)	(718,890)	(1,597,282)
Loss per share – basic and fully diluted	(0.005)	(0.004)	(0.009)

There were no changes to the unaudited condensed consolidated statement of cash flows as at June 30, 2020 beyond the adjustments to the two affected elements within operating activities.

(11)