Mr. Frank Dumas reports

MANUFACTURING COMPLETED FOR AUTOMATED INDUSTRIAL BATTERY PROCESSING CIRCUITS, FINANCING & LITHIUM PROCESSING UPDATE

St-Georges Eco-Mining Corp. has received confirmation of delivery at the manufacturer of the second and third automated industrial battery processing circuits, each capable of processing 7,800 tons of battery per year. These circuits will add capacity to the circuit already in transit and allow the company to process 23,400 tons of spent batteries per year. This additional capacity is over and above the 4,500-ton capacity for alkaline battery processing already installed and being upgraded while awaiting environmental authorizations.

The company received confirmation from the manufacturer that the circuits were ready for independent testing. As of today, the independent inspection is completed. Management expects to receive the independent engineering certification report from WSP Engineering before the end of May, and the shipping of these circuits will follow in short order.

The company has also received the detailed engineering layout from the same engineering firm for the proposed plant in Quebec that is under review.

Lithium hydroxide production update

The company has made a significant improvement to its process to manufacture lithium hydroxide from spodumene concentrates. The nitric acid used in the process was, until now, recirculated at 92 per cent while 8 per cent was recuperated by amalgamating it with fertilizers byproducts.

The company has improved the method to recover the alumina content (AI2O3) of the spodumene concentrate, allowing the production of aluminum nitrate nonahydrate at grades exceeding 99.9 per cent.

These initial results show the possibility of producing an aluminum byproduct with a ready market and very few impurities, which could be improved as the research for this byproduct is advanced by the metallurgical team. The market value of the product, which contains only 7.193 per cent aluminum, could cover a significant portion of the costs of running the process to produce the lithium hydroxide.

The company was also able to produce aluminum oxides in the same sequence. However, the byproduct generated in this form reaches only 99.5-per-cent purity and would sell at a discount compared with the aluminum nitrate nonahydrate.

The carbon footprint of the process is currently being modellized. This modelling is being done on the assumption that natural gas will be used. Dark green hydrogen would change these results drastically if it were to be used. The company is nonetheless working on improvements with the goal of reaching net-zero emissions with legacy fossil fuel sources.

" ... The company continues to make significant improvements on its process to make lithium hydroxide from spodumene concentrates ... The feed to this line is an aluminum nonahydrate. The purity of the product is already at 99.9 per cent and can be sold as is for a good value ... A useful rule of thumb is that we will produce a little more than three tons for every ton of lithium hydroxide. The significance of this improvement is that this product has excellent value as is and eliminates one step to produce the alumina originally planned ... Both products are possible ... aluminum nitrate nonahydrate is expensive to produce from alumina. However, it can be produced economically at a low cost while producing lithium products. It can also greatly contribute to the bottom line while helping eliminate waste streams. We look forward to future updates in this area as development continues, but the early results are very encouraging and exciting," commented Enrico Di Cesare, St-Georges vice-president, research and development, and chief executive officer of St-Georges Metallurgy.

Financing offering

Management has studied different scenarios to accelerate the development of EVSX's operations and has decided to leverage the newly acquired industrial set-up to finance its growth while limiting the dilution to its share capital. Following the conclusions of this exercise, the company would like to announce its intention to raise up to $3-million by way of secured convertible debentures in up to three tranches of $1-million each. The company reserves the right to cancel any subsequent tranches of this financing as its operations ramp up and cash flow requirements are met by other sources.

The debentures will be secured and will bear interest at 9.9 per cent per annum. Subject to certain conditions, the company will pay the interest accrued over the first three years in equity and may elect to satisfy payment in kind for the remaining interest by issuing common shares of the company. In the event of payment in kind, the number of interest shares due will be calculated using a conversion price equal to the conversion price (as defined herein).

The holder may, at its option, convert in full or in part, the principal of the debentures, at any time prior to the maturity date, being the fifth anniversary of the issue date, into common shares at 25 cents per share for the initial two years and afterward at the volume-weighted average of the previous 10 trading days discounted by 10 per cent subject to a floor price of $1 per share.

In addition, subscribers for debentures will receive one common share purchase warrant for each 25 cents of principal amount of debenture. Each warrant will entitle the holder to acquire one common share of the company for 35 cents at any time up to three years from the date of issuance. The warrants will also be subject to an acceleration clause providing for the acceleration of the expiry of the warrants if, at any time after the date that is four months plus one day after such warrants are issued, the closing price of the common shares on the Canadian Securities Exchange (CSE) equals or exceeds 50 cents, in which event the company shall have the right to accelerate the expiry date of the warrants to a date that is 30 days after the earlier of (a) the date upon which the company issues a press release announcing the acceleration and (b) the date upon which the company delivers a written acceleration notice to the holder, whichever should occur first.

Closing of the initial tranche of the offering has been set for Aug. 15, 2023. The closing of the offering is subject to the receipt of necessary regulatory approvals, including, where applicable, the approval of the CSE. The debentures, common shares, warrants and any warrant shares will be subject to a four-month hold period under applicable securities laws and CSE policies. The company may pay eligible finders a fee in connection with the offering.

An additional review by foreign regulators might be required to accommodate some of the potential subscribers.

The company can buy back the debentures with the accrued interests at any moment with no penalty after the initial two years.

The company plans to use the net proceeds from the offering for general corporate purposes and as liquidity and cash flow reserve to support the launch of the battery recycling operations of its subsidiary EVSX Corp.

About St-Georges Eco-Mining Corp.

St-Georges develops new technologies to solve some of the most common environmental problems in the mining sector, including maximizing metal recovery and full-circle battery recycling. The company explores for nickel and platinum group elements on the Manicouagan and Julie projects on Quebec's North Shore and has multiple exploration projects in Iceland, including the Thor gold project. Headquartered in Montreal, St-Georges's stock is listed on the CSE under the symbol SX and trades on the Frankfurt Stock Exchange under the symbol 85G1 and as SXOOF on the OTCQB Venture Market for early-stage and developing U.S. and international companies.