First Phosphate Corp. (CSE: PHOS) (OTC: FRSPF) (FSE: KD0) is pleased to announce that it has signed a Joint Development Agreement with Integrals Power Limited of Milton Keynes, United Kingdom to produce battery grade iron III phosphate precursor to supply the lithium iron phosphate battery industry outside of China.

Business Case

• Iron phosphate is a manufactured substance used as a base precursor in the traditional production of LFP cathode active material in China.

• To initiate production of LFP batteries outside of China in the most cost-effective format using the traditional LFP synthesis method, a locally produced source of iron phosphate precursor is required, one which meets US Inflation Reduction Act local production requirements.

• Iron phosphate is generally produced in China using iron sulfate and mono ammonium phosphate.

• Iron sulfate is not always readily available in quantity as a source of iron outside of China.

• Moreover, the waste streams produced from the production of iron phosphate using iron sulfate and mono ammonium phosphate are not easily manageable within European/North American environmental compliance frameworks.

• A new process for making iron phosphate precursor is required for the European and North American LFP battery industry, one which is compliant with applicable environmental standards.

• A process for making iron phosphate in North America must to be cost sensitive in order to compete with iron phosphate producers in China as the latter are able to arbitrage labour and environmental standards between Europe/North America and China.

Business Agreement

• The parties agree to undertake an initial phase of joint development of the technology needed to produce the iron phosphate precursor for LFP CAM.

• If successful, the joint development is expected to result in a scalable, low cost, environmentally compliant technology for the production of battery grade iron III phosphate (FePO₄); one which could be combined with lithium carbonate or lithium hydroxide to produce LFP CAM.

• If successful, the parties agree to work collaboratively to bring this process into immediate large scale production.

• Where possible, First Phosphate will provide the raw materials to make the iron III phosphate based on its phosphate concentrate (source of PPA) and its magnetite (source of iron).

• The intellectual property developed to produce the iron III phosphate will be co-owned by First Phosphate and IPL.

• The effort required to develop the initial phase technology is estimated to take up to 9 months to creation of a full pilot line. Contemporaneously, large-scale expansion plans for the technology will be developed by the parties.

• Research and development of this initiative will be carried out by IPL. To support the development, First Phosphate will pay USD $250,000 to IPL. The balance of the initial stage development costs will be funded by IPL.

• First Phosphate has been granted a share purchase option to acquire 2.7% of the shares in the capital of IPL at a cost of £500,000 exercisable until March 1, 2026. First Phosphate agrees to pay a penalty of £25,000 if more than 75% of the option expires unexercised. First Phosphate currently owns 7,386 shares of IPL representing 0.6% of the company.

About First Phosphate Corp.

First Phosphate is a mineral development company fully dedicated to extracting and purifying phosphate for the production of cathode active material for the LFP battery industry. First Phosphate is committed to producing at high purity level, in responsible manner and with low anticipated carbon footprint. First Phosphate plans to vertically integrate from mine source directly into the supply chains of major North American LFP battery producers that require battery grade LFP cathode active material emanating from a consistent and secure supply source. First Phosphate holds over 1,500 sq. km of royalty-free district-scale land claims in the Saguenay-Lac-St-Jean Region of Quebec, Canada that it is actively developing. First Phosphate properties consist of rare anorthosite igneous phosphate rock that generally yields high purity phosphate material devoid of high concentrations of harmful elements.

About Integrals Power Limited

IPL is a next-generation battery nano-material company committed to accelerated research, development and commercialisation of lithium-ion battery. The team of entrepreneurs, scientists and engineers have conducted comprehensive market verification and validation to form their strategy for the development of commercially feasible battery materials. This broad market research empowered the accelerated development and production of IPL proprietary high-performance, cost effective and scalable battery cathode materials for LFP/LFMP batteries. IPL’s latest battery material development results empower economical cells with higher performance compared to the conventional alternatives.