Equibles

10-Q/A

Atlas Lithium Corp (ATLX)

10-Q/A 2024-11-08 For: 2024-06-30
View Original
Added on April 09, 2026

UNITED

STATES

SECURITIES

AND EXCHANGE COMMISSION

WASHINGTON,

D.C. 20549

FORM

10-Q/A

Amendment No. 1

(Mark One)

☒ QUARTERLY<br> REPORT PURSUANT TO SECTION 13 or 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934.

For the quarterly period ended ### June 30, 2024

☐ TRANSITION<br> REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934.

For

the transition period from ____________ to ____________

Commission

File Number 001-41552

ATLAS

LITHIUM CORPORATION

(Exact name of registrant as specified in its charter)

Nevada 39-2078861
(State<br> or other jurisdiction of (IRS<br> Employer
incorporation<br> or organization) Identification<br> No.)

RuaAntonio de Albuquerque, 156 – 17th Floor

BeloHorizonte, Minas Gerais, Brazil, 30.112-010

(Address of principal executive offices, including zip code)

RuaBuenos Aires, 10 – 14th Floor

BeloHorizonte, Minas Gerais, Brazil, 30.315-570

(Former name, former address and former fiscal year, if changed since last report)

(833)661-7900

(Registrant’s telephone number, including area code)

Securities

registered pursuant to Section 12(b) of the Act

Title of each class Trading Symbol(s) Name of each exchange on which registered
Common<br> Stock, $0.001 par value ATLX The<br> Nasdaq Capital Market

Securities registered pursuant to Section 12(g) of the Act: None

Indicate by check mark whether the issuer (1) filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company or, an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company,” in Rule 12b-2 of the Exchange Act.

Large<br> accelerated filer ☐ Accelerated<br> filer ☐
Non-accelerated<br> filer ☒ Smaller<br> reporting company ☒
Emerging<br> growth company ☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Act). Yes ☐ No ☒

As

of August 9, 2024, there were outstanding 15,249,792 shares of the registrant’s common stock.

DOCUMENTS INCORPORATED BY REFERENCE: None.

EXPLANATORY

NOTE

Atlas Lithium Corporation (“Atlas Lithium”, the “Company”, “we”, “us”, or “our” refer to Atlas Lithium Corporation and its consolidated subsidiaries) is filing this Amendment No. 1 (this “Amendment”) to its Quarterly Report on Form 10-Q for the period ended June 30, 2024, as filed with the Securities and Exchange Commission (the “SEC”) on August 9, 2024 (the “Original Form 10-Q”) to restate our condensed consolidated financial statements, including the notes thereto, for the three months ended June 30 and to make certain other changes as described herein. Pipara & Co LLP (“Pipara”) was engaged by the Audit Committee of our Board of Directors (the “Audit Committee”) to be our independent registered public accounting firm as a result of the SEC’s order on May 3, 2024 suspending our prior independent registered public accounting firm, BF Borgers CPA PC (“Borgers”), from appearing and practicing as an accountant before the SEC. The Audit Committee engaged Pipara to re-audit our financial statements for the two fiscal years ended December 31, 2023 included in our Annual Report on Form 10-K for the fiscal year ended December 31, 2023 (the “2023 Annual Report”). In connection with Pipara’s audit, we identified certain accounting errors relating to the presentation, timing, omission and classification of a number of items in the 2023 Annual Report that also impacted our condensed consolidated financial statements for the quarter ended June 30, 2024, as presented in the Original 10-Q (the “Previously Issued Financial Statements”). Following discussions with our management and Pipara, the Audit Committee determined that our Previously Issued Financial Statements will be restated to make the required corrections, necessary to comply with U.S. Generally Accepted Accounting Principles (“U.S. GAAP”) as further described below.

The restated condensed consolidated financial statements for the quarter ended June 30, 2024 (the “Restated Financial Statements”), including the notes thereto, update and revise items in the Original Form 10-Q, including: (i) correction of errors in the treatment of certain right of use lease assets, (ii) correction of errors relating to the timing of recording executive bonuses, (iii) reclassification of a tax refinancing liability, (iv) correction of errors in the recording of Deferred other income, (v) derecognition of certain erroneous currency translation adjustments and (vi) re-assessing our interest in the net assets of certain of our non-wholly owned subsidiaries.

This Amendment also changes the Original Form 10-Q to (i) update the address of our principal executive offices; and (ii) amend Part I, Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operation, to reflect the restated numbers derived from the Restated Financial Statements and corresponding descriptions of our accounting policies.

For additional details of each line change, please refer to the section named “Restatement of Previously Issued Condensed Consolidated Balance Sheets as of June 30, 2024 and Condensed Consolidated Statements of Operations and Comprehensive Loss for the Three and Six Months Ended June 30, 2024” in Note 1 – Organization, Business and Summary of Significant Accounting Policies to the Restated Financial Statements.

We have concluded that in light of the errors described above, a material weakness exists in our internal control over financial reporting and that our disclosure controls and procedures were not effective as of June 30, 2024. For a discussion of management’s consideration of our disclosure controls and procedures, see Part I, Item 4, “Controls and Procedures” of this Amendment.

Except as described above, no other portion of the Original Form 10-Q is being amended and this Amendment does not reflect any events occurring after the filing of the Original Form 10-Q.

TABLE

OF CONTENTS

Page
Cautionary Note Regarding Forward-Looking Statements 3
PART I - FINANCIAL INFORMATION 4
Item<br> 1. Financial Statements 4
Condensed<br> Consolidated Balance Sheets as of June 30, 2024 (Unaudited) and December 31, 2023 4
Condensed Consolidated Statements of Operations and Comprehensive Loss for the Three and Six Months<br>Ended June 30, 2024 and 2023 (Unaudited) 5
Condensed Consolidated Statements of Changes in Stockholders’ Equity for the Three and Six<br>Months Ended June 30, 2024 and 2023 (Unaudited) 6
Condensed Consolidated Statements of Cash Flows for the Six Months Ended June 30, 2024 and 2023<br>(Unaudited) 8
Notes to the Condensed Consolidated Financial Statements (Unaudited) 9
Item<br> 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations. 30
Item<br> 3. Quantitative and Qualitative Disclosures About Market Risk 34
Item<br> 4. Controls and Procedures. 34
PART II - OTHER INFORMATION 35
Item<br> 1. LEGAL PROCEEDINGS 35
Item<br> 1A. RISK FACTORS 35
Item<br> 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS 35
Item<br> 3. DEFAULTS UPON SENIOR SECURITIES 35
Item<br> 4. MINE SAFETY DISCLOSURES 35
Item<br> 5. OTHER INFORMATION 35
Item<br> 6. Exhibits 36
Signatures 37 
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CAUTIONARY

NOTE REGARDING FORWARD LOOKING STATEMENTS

This Quarterly Report contains forward-looking statements. We intend such forward-looking statements to be covered by the safe harbor provisions for forward-looking statements contained in Section 27A of the Securities Act of 1933, as amended (the “Securities Act”) and Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”). All statements other than statements of historical fact contained in this Quarterly Report are forward-looking statements, including without limitation, statements regarding current expectations, as of the date of this Quarterly Report, our future results of operations and financial position, our ability to effectively process our minerals and achieve commercial grade at scale; risks and hazards inherent in the mining business (including risks inherent in exploring, developing, constructing and operating mining projects, environmental hazards, industrial accidents, weather or geologically related conditions); uncertainty about our ability to obtain required capital to execute our business plan; our ability to hire and retain required personnel; changes in the market prices of lithium and lithium products and demand for such products; the uncertainties inherent in exploratory, developmental and production activities, including risks relating to permitting, zoning and regulatory delays related to our projects; uncertainties inherent in the estimation of lithium resources. These statements involve known and unknown risks, uncertainties and other important factors that may cause actual results, performance, or achievements to differ materially from any future results, performance or achievement expressed or implied by these forward-looking statements.

In some cases, you can identify forward-looking statements by terms such as “may,” “will,” “should,” “expect,” “plan,” “anticipate,” “could,” “intend,” “target,” “project,” “contemplate,” “believe,” “estimate,” “predict,” “potential,” or “continue” or the negative of these terms or other similar expressions Factors that could cause future results to materially differ from the recent results or those projected in forward-looking statements include, but are not limited to: unprofitable efforts resulting not only from the failure to discover mineral deposits, but also from finding mineral deposits that, though present, are insufficient in quantity and quality to return a profit from production; market fluctuations; government regulations, including regulations relating to permitting, royalties, allowable production, importing and exporting of minerals, and environmental protection; competition; the loss of services of key personnel; unusual or infrequent weather phenomena, litigation, sabotage, government or other interference in the maintenance or provision of infrastructure as well as general economic conditions.

The forward-looking statements in this Quarterly Report are based largely on our current expectations and projections about future events and financial trends that we believe may affect our business, financial condition and results of operations. These forward-looking statements speak only as of the date of this Quarterly Report and are subject to a number of important factors that could cause actual results to differ materially from those in the forward-looking statements, including the factors described under the sections in this Quarterly Report titled “Risk Factors” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and other of our filings made with the Securities and Exchange Commission (the “SEC”). Additional information regarding risk factors that may affect us is included in our Annual Report on Form 10-K for fiscal year ended December 31, 2023 (the “2023 Annual Report”) filed with the SEC on March 27, 2024. The risk factors contained in our 2023 Annual Report are updated by us from time to time in Quarterly Reports on Form 10-Q, Current Reports on Form 8-K, and other filings that we make with the SEC.

You should read this Quarterly Report and the documents that we reference in this Quarterly Report completely and with the understanding that our actual future results may be materially different from what we expect. Given these uncertainties, we caution you not to place undue reliance on these forward-looking statements. Except as required by applicable law, we do not plan to publicly update or revise any forward-looking statements contained herein, whether as a result of any new information, future events, changed circumstances or otherwise.

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PART

I - FINANCIAL INFORMATION

Item

1 FINANCIAL STATEMENTS

ATLAS

LITHIUM CORPORATION

CONSOLIDATED

BALANCE SHEETS (UNAUDITED)

June

30, 2024 and December 31, 2023

December<br> 31, 2023
As restated
ASSETS
Current assets:
Cash<br> and cash equivalents 32,267,730 $ 29,549,927
Inventories 150,663 -
Taxes<br> recoverable 11,000 50,824
Prepaid<br> and other current assets 149,146 113,905
Total<br> current assets 32,578,539 29,714,656
Property<br> and equipment, net 29,890,627 13,477,602
Intangible<br> assets, net 408,933 45,777
Right<br> of use assets - operating leases, net 271,540 335,634
Other<br> assets 46,949 -
Total<br> assets 63,196,588 $ 43,573,669
LIABILITIES<br> AND STOCKHOLDERS’ EQUITY
Current liabilities:
Accounts<br> payable and accrued expenses 4,901,808 $ 4,668,857
Derivative<br> liabilities 370,650 1,000,060
Convertible<br> Debt 81,918 67,024
Operating<br> lease liabilities 121,442 127,482
Other current liabilities 34,760 41,596
Total<br> current liabilities 5,510,578 5,905,019
Convertible<br> Debt 9,755,506 9,703,700
Operating<br> lease liabilities 145,421 231,278
Deferred other income 20,000,000 20,000,000
Other<br> noncurrent liabilities 22,892 58,579
Total<br> liabilities 35,434,397 35,898,576
Stockholders’ Equity:
Series A preferred stock,<br> 0.001 par value. 1 share authorized; 1 share issued and outstanding as of June 30, 2024 and December 31, 2023 1 1
Common stock, 0.001 par<br> value. 200,000,000 and 200,000,000 shares authorized as of June 30, 2024 and December 31, 2023, respectively;14,824,692 and<br> 12,763,581 shares issued and outstanding as of June, 2024 and December 31, 2023, respectively 14,825 12,764
Additional<br> paid-in capital 151,964,718 110,195,978
Accumulated<br> other comprehensive Profit/(loss) 145,069 (138,829 )
Accumulated<br> deficit (124,956,950 ) (102,822,123 )
Total<br> Atlas Lithium Co. stockholders’ equity 27,167,663 7,247,791
Non-controlling<br> interest 594,528 427,302
Total<br> stockholders’ equity 27,762,191 7,675,093
Total<br> liabilities and stockholders’ equity 63,196,588 $ 43,573,669

All values are in US Dollars.

The

accompanying notes are an integral part of the consolidated financial statements.

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ATLAS

LITHIUM CORPORATION

CONSOLIDATED

STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS (UNAUDITED)

For

the Three and Six Months Ended June 30, 2024 and 2023

2024 2023 2024 2023
Three months ended June 30 Six months ended June 30
2024 2023 2024 2023
As restated As restated As restated As restated
Revenue 182,788 - 374,108 -
Cost of revenue 91,786 - 193,852 -
Gross margin 91,002 - 180,256 -
Operating expenses
General and administrative expenses 4,565,336 2,007,983 7,817,090 4,329,681
Stock-based compensation 4,972,562 2,852,309 11,812,684 3,981,154
Exploration - 4,663,500 3,170,983 5,692,325
Other operating expenses 99,268 - 102,869 -
Total operating expenses 9,637,166 9,523,792 22,903,626 14,003,160
Loss from operations (9,546,164 ) (9,523,792 ) (22,723,370 ) (14,003,160 )
Other expenses (income)
Other expenses (income) 10,007 (126,896 ) 12,989 (140,911 )
Fair value adjustments, net (124,228 ) - (311,717 ) -
Finance costs (income) 515,145 - 702,029 -
Total other expenses (income) 400,924 (126,896 ) 403,301 (140,911 )
Gain / (Loss) before provision for income taxes (9,947,088 ) (9,396,896 ) (23,126,671 ) (13,862,249 )
Provision for income taxes 6,220 - 10,833 -
Net gain / (loss) (9,953,308 ) (9,396,896 ) (23,137,504 ) (13,862,249 )
Gain / (Loss) attributable to non-controlling interest (781,948 ) (270,247 ) (1,002,677 ) (769,662 )
Net gain / (loss) attributable to Atlas Lithium Corporation stockholders $ (9,171,360 ) $ (9,126,649 ) $ (22,134,827 ) $ (13,092,587 )
Basic and diluted gain / (loss) per share
Basic and diluted net gain / (loss) per share attributable<br> to Atlas Lithium Corporation common stockholders $ (0.67 ) $ (1.01 ) $ (1.61 ) $ (1.46 )
Weighted-average number of common shares outstanding: 13,721,860 9,068,801 13,721,662 8,966,065
Comprehensive loss:
Net gain / (loss) $ (9,953,308 ) $ (9,396,896 ) $ (23,137,504 ) $ (13,862,249 )
Foreign currency translation adjustment 574,752 39,586 644,778 105,891
Comprehensive gain / (loss) (9,378,556 ) (9,357,310 ) (22,492,726 ) (13,756,358 )
Comprehensive loss attributable to noncontrolling interests (613,879) (269,567 ) (641,798 ) (768,493 )
Comprehensive gain / (loss) attributable to Atlas Lithium Corporation stockholders $ (8,764,677 ) $ (9,087,743 ) $ (21,850,928 ) $ (12,987,865 )

The accompanying notes are an integral

part of the consolidated financial statements.

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ATLAS

LITHIUM CORPORATION

CONSOLIDATED

STATEMENTS OF CHANGES IN STOCKHOLDERS’ EQUITY (UNAUDITED)

For

the three Months Ended June 30, 2024 and 2023

**** Series A Preferred Stock Series D Preferred Stock **** Common Stock **** Additional<br><br> <br>Paid-in **** Accumulated<br><br> <br>Other<br><br> <br>Comprehensive Accumulated **** Noncontrolling **** Total<br><br> <br>Stockholders’<br><br> <br>Equity ****
Shares Value Shares Value Shares Value Capital Loss Deficit Interests (Deficit)
Balance, March 31, 2023 1 $ 1 214,006 $ 214 6,738,062 $ 6,739 $ 73,504,919 $ 59,180 $ (64,357,632 ) $ (711,165 ) $ 8,502,256
Issuance of common stock in connection with sales made - - - - 299,590 299 963,477 - - - 963,776
Issuance of common stock in connection with purchase of mining rights - - - - - - - - - - -
Issuance of common stock in exchange for consulting,<br> professional and other services - - - - (26,796 ) (27 ) (146,980 ) - - - (147,007 )
Conversion of Convertible Preferred D stock into Common Stock - - (214,006 ) (214 ) 2,853,413 2,853 - - - - 2,639
Stock based compensation - - - - 142,269 142 3,003,986 - - - 3,004,128
Change in foreign currency translation - - - - - - - 38,906 - 680 39,586
Sale of Jupiter Gold common stock in connection with equity<br> offerings - - - - - - 75,000 - - - 75,000
Sale of Apollo Resources common stock in connection with<br> equity offerings - - - - - - - - - - -
Net loss - - - - - - - - (9,126,649 ) (270,247 ) (9,396,896 )
Balance, June, 2023 1 $ 1 - $ - 10,033,334 $ 10,033 $ 77,472,382 $ 98,086 $ (73,484,281 ) $ (980,732 ) $ 3,115,489
**** Series A Preferred Stock Series D Preferred Stock Common Stock Additional<br><br> <br>Paid-in Accumulated<br><br> <br>Other<br><br> <br>Comprehensive **** Accumulated **** Noncontrolling **** Total<br><br> <br>Stockholders’ ****
--- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- ---
Shares Value Shares Value Shares Value Capital Loss Deficit Interests Equity
Balance, March 31, 2024 1 $ 1 - $ - 12,769,581 $ 12,770 $ 116,403,497 $ (68,803 ) $ (115,785,590 ) $ 399,384 $ 961,259
Issuance of common stock in connection with sales made
under private offerings - - - - 1,871,250 1,871 29,998,127 - - 449,450 30,449,449
Issuance of common stock in connection with sales made under<br> private offerings - - - - 1,871,250 1,871 29,998,127 - - 449,450 30,449,449
Issuance of common stock in connection with purchase of mining rights - - - - - - - - - - -
Issuance of common stock in connection with purchase of mining rights, shares - - - - - - - - - - -
Issuance of common stock in exchange for consulting,<br> professional and other services - - - - - - -
Issuance of common stock in exchange for consulting,<br> professional and other services, shares
Exercise of warrants, shares - - - - - - - - - - -
Stock based compensation - - - - 183,861 184 5,563,094 - - 235,069 5,798,347
Change in foreign currency translation - - - - - - - 213,872 - 292,574 506,446
Net loss - - - - - - - - (9,171,360 ) (781,948 ) (9,953,308 )
Balance, June 30, 2024 1 $ 1 - $ - 14,824,692 $ 14,825 $ 151,964,718 $ 145,069 $ (124,956,950 ) $ 594,528 $ 27,762,191 
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For the Six Months Ended June 30, 2024 and 2023

Shares Value Shares Value Shares Value Capital Loss Deficit Interests Equity
Series<br> A Preferred Stock Series<br> D Preferred Stock Common<br> Stock Additional<br><br> <br>Paid-in Accumulated<br><br> <br>Other<br><br> <br>Comprehensive Accumulated Noncontrolling Total<br><br> <br>Stockholders’
Shares Value Shares Value Shares Value Capital Loss Deficit Interests Equity
Balance, December 31, 2022 1 $ 1 214,006 $ 214 5,110,014 $ 5,111 $ 62,063,367 $ (6,636 ) $ (60,391,694 ) $ (212,239 ) $ 1,458,124
Issuance of common stock in<br> connection with sales made under private offerings - - - - 1,850,398 1,850 10,718,273 - - - 10,720,123
Issuance of common stock in<br> connection with purchase of mining rights - - - - 77,240 77 749,923 - - - 750,000
Conversion of Convertible Preferred<br> D stock into Common Stock (214,006 ) (214 ) 2,853,413 2,853 - - - - 2,639
Stock based compensation - - - - 142,269 142 3,940,819 - - - 3,940,961
Change in foreign currency<br> translation - - - - - - - 104,722 - 1,169 105,891
Net loss - - - - - - - - (13,092,587 (769,662 ) (13,862,249 )
Balance, June 30, 2023 1 $ 1 - $ - 10,033,334 $ 10,033 $ 77,472,382 $ 98,086 $ (73,484,281 ) $ (980,732 ) $ 3,115,489
Series<br> A Preferred Stock Series<br> D Preferred Stock Common<br> Stock Additional<br><br> <br>Paid-in Accumulated<br><br> <br>Other<br><br> <br>Comprehensive Accumulated Noncontrolling Total<br><br> <br>Stockholders’
--- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- ---
Shares Value Shares Value Shares Value Capital Loss Deficit Interests Equity
Balance, December<br> 31, 2023 1 $ 1 - $ - 12,763,581 $ 12,764 $ 110,195,978 $ (138,829 ) $ (102,822,123 ) $ 427,302 $ 7,675,093
Balance 1 $ 1 - $ - 12,763,581 $ 12,764 $ 110,195,978 $ (138,829 ) $ (102,822,123 ) $ 427,302 $ 7,675,093
Issuance of common stock in<br> connection with sales made under private offerings - - - - 1,871,250 1,871 29,998,127 - - 449,450 30,449,449
Issuance of common stock in<br> exchange for consulting, professional and other services 6,000 6 105,091 - - - 105,097
Stock based compensation - - - - 183,861 184 11,665,522 - - 359,574 12,025,280
Change in foreign currency<br> translation - - - - - - - 283,898 - 360,879 644,778
Net loss - - - - - - - - (22,134,827 ) (1,002,677 ) (23,137,504 )
Balance, June 30, 2024 1 $ 1 - $ - 14,824,692 $ 14,825 $ 151,964,718 $ 145,069 $ (124,956,950 ) $ 594,528 $ 27,762,191
Balance 1 $ 1 - $ - 14,824,692 $ 14,825 $ 151,964,718 $ 145,069 $ (124,956,950 ) $ 594,528 $ 27,762,191

The

accompanying notes are an integral part of the consolidated financial statements.

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ATLAS

LITHIUM CORPORATION

CONSOLIDATED

STATEMENTS OF CASH FLOWS (UNAUDITED)

For

the Six Months Ended June 30, 2024 and 2023

2024 2023
Six<br> months ended June 30
2024 2023
Cash flows from operating<br> activities of continuing operations:
Net<br> loss $ (23,137,504 ) (13,862,249 )
Adjustments<br> to reconcile net loss to cash used in operating activities:
Stock<br> based compensation and services 11,812,684 3,981,154
Depreciation<br> and amortization 65,024 8,108
Interest<br> expense 443,956 -
Fair value adjustments (311,717 ) -
Other<br> non cash expenses - 140,911
Changes<br> in operating assets and liabilities:
Accounts<br> receivable - (8 )
Inventories (150,663 ) -
Taxes<br> recoverable 39,824 (3,576 )
Deposits<br> and advances (35,241 ) (18,073 )
Other<br> assets (48,820 ) -
Accounts<br> payable and accrued expenses 66,114 813,606
Consideration from royalty sold - 20,000,000
Other<br> noncurrent liabilities (35,878 ) (26,382 )
Net<br> cash provided (used) by operating activities (11,292,221 ) 11,033,491
Cash flows<br> from investing activities:
Acquisition of capital assets (13,970,339 ) (1,884,035 )
Capitalized exploration costs (2,443,616 ) -
Increase<br> in intangible assets (363,156 ) (45,777 )
Net<br> cash used in investing activities (16,777,111 ) (1,929,812 )
Cash flows<br> from financing activities:
Net proceeds from sale of<br> common stock 30,000,000 10,525,118
Proceeds from sale of subsidiary<br> common stock to noncontrolling interests 449,450 150,000
Cash<br> used in payment of debt (309,152 ) -
Net<br> cash provided by financing activities 30,140,298 10,675,118
Effect<br> of exchange rates on cash and cash equivalents 646,837 105,892
Net increase (decrease) in<br> cash and cash equivalents 2,717,803 19,884,689
Cash<br> and cash equivalents at beginning of period 29,549,927 280,525
Cash<br> and cash equivalents at end of period 32,267,730 20,165,214

The

accompanying notes are an integral part of the consolidated financial statements.

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ATLAS

LITHIUM CORPORATION

NOTES

TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

NOTE

1 – ORGANIZATION, BUSINESS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Organizationand Description of Business

Atlas Lithium Corporation (together with its subsidiaries “Atlas Lithium,” the “Company,” the “Registrant,” “we,” “us,” or “our”) was incorporated under the laws of the State of Nevada, on December 15, 2011. The Company changed its management and business on December 18, 2012, to focus on mineral exploration in Brazil.

Basisof Presentation and Principles of Consolidation

The

consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”) and are expressed in United States dollars. For the period ended June 30, 2024, the consolidated financial statements include the accounts of the Company; its 100% owned subsidiary, Atlas Lítio Brasil Ltda. (“Atlas Brasil”), Athena Lítio Ltda (“Athena”) and its 47.58% equity interest in Apollo Resources Corporation (“Apollo Resources”) and Apollo Resources’ subsidiaries, Mineração Apollo, Ltda., Mineração Duas Barras Ltda. (“MDB”) and RST Recursos Minerais Ltda. (“RST”); and the Company’s 22.30% equity interest in Jupiter Gold Corporation (“Jupiter Gold”), which includes the accounts of Jupiter Gold’s subsidiary, Mineração Jupiter Ltda. The Company has concluded that Apollo Resources, Jupiter Gold and their respective subsidiaries are variable interest entities (“VIE”) in accordance with applicable accounting standards and guidance. As such, the accounts and results of Apollo Resources, Jupiter Gold and their respective subsidiaries have been included in the Company’s consolidated financial statements.

All material intercompany accounts and transactions have been eliminated in consolidation.

Useof Estimates

The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingencies at the date of the financial statements and the reported amount of revenues and expenses during the reporting period. Actual results may differ from those estimates.

RecentAccounting Pronouncements

The Company has implemented all new accounting pronouncements that are in effect and that may impact its financial statements and does not believe that there are any other new pronouncements that have been issued that might have a material impact on its financial position or results of operations.

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ATLAS

LITHIUM CORPORATION NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

NOTE

1 – ORGANIZATION, BUSINESS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

Restatementof Previously Issued Condensed Consolidated Balance Sheets as of June 30, 2024 and Condensed Consolidated Statements ofOperations and Comprehensive Loss for the Three and Six Months Ended June 30, 2024

Subsequent to the issuance of our Original Form 10-Q, management became aware of adjustments to be recorded to our condensed consolidated financial statements as of June 30, 2024. Accordingly, our condensed consolidated balance sheets as of June 30, 2024 and December 31, 2023, and condensed consolidated statements of operations for the three and six months ended June 30, 2024 have been restated as further described below.

The following is a summarized description of the areas in which the errors were identified and for which we made correcting disclosures, reclassification and adjustments to our condensed consolidated financial statements.

(1) Reclassification of mining rights from Intangible assets to PPE in accordance with ASC 930-805, which provides that mining rights should be classified as tangible assets. The Company also reassessed the amounts comprising consolidated Property and equipment and excluded amounts owned by two entities controlled by the same controlling shareholder of the Company from the consolidation as they do not qualify as entities controlled by the Company.

(2) Identified and adjusted errors in the right of use assets - operating leases related to the extension of existing operating lease contract.

(3) Identified bonuses payable to senior executives that were incurred, however not accounted for in the correct year.

(4) Reclassified Tax refinancing from Accounts payable to Other current liabilities to adequate the presentation of each nature of liability which are tax installments agreed to be paid to the government generally in 48 months.

(5) Identified and corrected an amount previously considered as a commission to be paid arising from the Royalty Agreement. The Royalty Agreement was not subject to any commissions payable.

(6) Derecognition of cumulative translation adjustment of Atlas Litio. Its functional currency is US$, and impacts arising from the translation of foreign exchange transactions should not be allocated to OCI.

(7) Reassessed the Company’s interest in each subsidiary’s net assets and concluded that amounts recorded as Non-controlling interest were not reflecting non-controlling shareholders’ interests in the subsidiaries’ net assets.

(8) Identified exploration costs that should be capitalized as disclosed in accounting policies.

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LITHIUM CORPORATION

NOTES

TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

NOTE

1 – ORGANIZATION, BUSINESS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

The following tables present the effect of the aforementioned adjustments on our condensed consolidated balance sheets as of June 30, 2024 and December 31, 2023, and indicate the category of the adjustments by reference to the line item descriptions set forth above:

SCHEDULE

OF ADJUSTMENTS ON FINANCIAL STATEMENTS

CONSOLIDATED BALANCESHEETS

As Previously Reported Adjustments Description of Adjustments As restated
June 30, 2024
As Previously Reported Adjustments Description of Adjustments As restated
Current assets:
Cash and cash equivalents $ 32,267,730 $ - 32,267,730
Accounts receivable - - -
Inventories 150,663 - 150,663
Taxes recoverable 11,000 - 11,000
Prepaid and other current assets 149,146 - 149,146
Total current assets 32,578,539 - 32,578,539
Property and equipment, net 27,447,011 2,443,616 (8) 29,890,627
Intangible assets, net 408,933 - 408,933
Right of use assets - operating leases, net 380,530 (108,990 ) (2) 271,540
Other Assets 46,949 - 46,949
Total assets $ 60,861,962 2,334,626 63,196,588
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities:
Accounts payable and accrued expenses $ 4,713,762 188,046 (3) 4,901,808
Derivative liabilities 370,650 - 370,650
Convertible Debt - short-term 81,918 - 81,918
Other current liabilities - 34,760 (4) 34,760
Operating lease liabilities - current 108,954 12,488 (2) 121,442
Total current liabilities 5,275,284 235,294 5,510,578
Convertible Debt - long-term 9,755,506 - 9,755,506
Operating lease liabilities - long-term 250,554 (105,133 ) (2) 145,421
Deferred other income 18,600,000 1,400,000 (5) 20,000,000
Other noncurrent liabilities 22,892 - 22,892
Total liabilities 33,904,236 1,530,161 35,434,397
Stockholders’ Equity:
Common stock 14,826 - 14,826
Additional paid-in capital 153,431,262 (1,466,544 ) (5) 151,964,718
Accumulated other comprehensive loss (835,873 ) 980,942 (6) 145,069
Accumulated deficit (126,242,962 ) 1,286,012 (2)(3)(5)(6) (124,956,950 )
Total Atlas Lithium Co, stockholders’ equity 26,367,253 800,410 27,167,663
Non-controlling interest 590,473 4,055 (7) 594,528
Total stockholders’ equity 26,957,726 804,465 27,762,191
Total liabilities and stockholders’ equity $ 60,861,962 2,334,626 63,196,588

CONSOLIDATED

BALANCE SHEETS

As Previously Reported Adjustments Description of Adjustments As Restated
December 31, 2023
As Previously Reported Adjustments Description of Adjustments As Restated
ASSETS
Current assets:
Cash and cash equivalents $ 29,549,927 $ - $ 29,549,927
Taxes recoverable 50,824 - 50,824
Prepaid and other current assets 113,905 - 113,905
Total current assets 29,714,656 - 29,714,656
Property and equipment, net 6,407,735 7,069,867 (1) 13,477,602
Intangible assets, net 7,115,644 (7,069,867 ) (1) 45,777
Right of use assets - operating leases, net 444,624 (108,990 ) (2) 335,634
Investments - - -
Total assets 43,682,659 (108,990 ) 43,573,669
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities:
Accounts payable and accrued expenses 4,487,647 181,210 (3) 4,668,857
Derivative liabilities 1,000,060 - 1,000,060
Convertible Debt 67,024 - 67,024
Related party notes and other payables - - -
Operating lease liabilities 114,994 12,488 (2) 127,482
Other current liabilities - 41,596 (4) 41,596
Total current liabilities 5,669,725 235,294 5,905,019
Convertible Debt 9,703,700 - 9,703,700
Operating lease liabilities 336,411 (105,133 ) (2) 231,278
Deferred other income 18,600,000 1,400,000 (5) 20,000,000
Other noncurrent liabilities 58,579 - 58,579
Total liabilities 34,368,415 1,530,161 35,898,576
Stockholders’ Equity:
Common stock 12,765 - 12,765
Additional paid-in capital 111,662,522 (1,466,544 ) (5) 110,195,978
Accumulated other comprehensive loss (1,119,771 ) 980,942 (6) (138,829 )
Accumulated deficit (101,664,519 ) (1,157,604 ) (2)(3)(5)(6) (102,822,123 )
Total Atlas Lithium Co. stockholders’ equity 8,890,997 (1,643,206 ) 7,247,791
Non-controlling interest 423,247 4,055 (7) 427,302
Total stockholders’ equity 9,314,244 (1,639,151 ) 7,675,093
Total liabilities and stockholders’ equity 43,682,659 (108,990 ) 43,573,669 
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LITHIUM CORPORATION

NOTES

TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

NOTE

1 – ORGANIZATION, BUSINESS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

The following table presents the effect of the aforementioned adjustments on our Consolidated Statements of Operation for the three months ended June 30, 2024 and indicates the category of the adjustments by reference to the above descriptions of the reclassifications or errors for which we made corrections:

As<br> Previously Reported Adjustments Description<br> of Adjustments As<br> restated
Three<br> months ended June 30, 2024
As<br> Previously Reported Adjustments Description<br> of Adjustments As<br> restated
Revenue $ 182,788 $ - $ 182,788
Cost<br> of revenue 91,785 1 91,786
Gross<br> loss 91,004 (2 ) 91,002
Operating<br> expenses -
General<br> and administrative expenses 4,565,336 - 4,565,336
Stock-based<br> compensation 4,972,562 - 4,972,562
Exploration 2,443,616 (2,443,616 ) (8) -
Other<br> operating expenses 99,268 - 99,268
Total<br> operating expenses 12,080,782 (2,443,616 ) 9,637,166
Loss<br> from operations (11,989,778 ) 2,443,616 (9,546,163 )
Other<br> expense (income)
Other<br> expense (income) 10,007 - 10,007
Fair<br> value adjustments, net (124,228 ) - (124,228 )
Finance<br> costs (revenue) 515,147 (2 ) 515,145
Total<br> other expense 400,926 (2 ) 400,924
Loss<br> before provision for income taxes (12,390,704 ) 2,443,618 (9,947,088 )
Provision<br> for income taxes 6,220 6,220
Net<br> loss (12,396,924 ) 2,443,618 (9,953,308 )
Loss<br> attributable to non-controlling interest (781,948 ) - (781,948 )
Net<br> loss attributable to Atlas Lithium Corporation stockholders (11,614,976 ) $ 2,443,618 (9,171,360 )
Basic<br> and diluted loss per share
Net<br> loss per share attributable to Atlas Lithium Corporation common stockholders $ (0.85 ) $ 0.18 $ (0.67 )
Weighted-average<br> number of common shares outstanding:
Basic<br> and diluted 13,721,860 - 13,721,860
Comprehensive<br> loss:
Net<br> loss (12,396,924 ) $ 2,443,618 (9,953,308 )
Foreign<br> currency translation adjustment 574,752 - 574,752
Comprehensive<br> loss (11,822,172 ) 2,443,618 (9,378,556 )
Comprehensive<br> loss attributable to NCI (613,879 ) - (613,879 )
Comprehensive<br> loss attributable to Atlas stockholders (11,208,293 ) $ 2,443,618 (8,764,677 ) 
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The following table presents the effect of the aforementioned adjustments on our condensed consolidated statements of operation for the three and six months ended June 30, 2024 and indicates the category of the adjustments by reference to the line item descriptions set forth above:

As<br> Previously Reported Adjustments Description<br> of Adjustments As<br> restated
Six months ended June 30, 2024
As Previously Reported Adjustments Description of Adjustments As restated
Revenue $ 374,108 $ - $ 374,108
Cost of revenue 193,852 - 193,852
Gross loss 180,256 - 180,256
Operating expenses -
General and administrative expenses 7,817,090 - 7,817,090
Stock-based compensation 11,812,684 - 11,812,684
Exploration 5,614,599 (2,443,616 ) (8) 3,170,983
Other operating expenses 102,869 - 102,869
Total operating expenses 25,347,242 (2,443,616 ) 22,903,626
Loss from operations (25,166,986 ) 2,443,616 (22,723,370 )
Other expense (income)
Other expense (income) 12,989 - 12,989
Fair value adjustments, net (311,717 ) - (311,717 )
Finance costs (revenue) 702,029 - 702,029
Total other expense 403,301 - 403,301
Loss before provision for income taxes (25,570,287 ) 2,443,616 (23,126,671 )
Provision for income taxes 10,833 10,833
Net loss (25,581,120 ) 2,443,616 (23,137,504 )
Loss attributable to non-controlling interest (1,002,677 ) - (1,002,677 )
Net loss attributable to Atlas Lithium Corporation stockholders (24,578,443 ) $ 2,443,616 (22,134,827 )
Basic and diluted loss per share
Net loss per share attributable to Atlas Lithium Corporation common stockholders $ (1.79 ) $ 0.18 $ (1.61 )
Weighted-average number of common shares outstanding:
Basic and diluted 13,721,662 13,721,662
Comprehensive loss:
Net loss (25,581,120 ) $ 2,443,616 (23,137,504 )
Foreign currency translation adjustment 644,778 - 644,778
Comprehensive loss (24,936,342 ) 2,443,616 (22,492,726 )
Comprehensive loss attributable to NCI (641,798 ) - (641,798 )
Comprehensive loss attributable to Atlas stockholders (24,294,544 ) $ 2,443,616 (21,850,928 ) 
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LITHIUM CORPORATION

NOTES

TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

NOTE

2 – COMPOSITION OF CERTAIN FINANCIAL STATEMENT ITEMS

Propertyand Equipment

The following table sets forth the components of the Company’s property and equipment at June 30, 2024 and December 31, 2023:

SCHEDULE

OF PROPERTY AND EQUIPMENT

June<br> 30, 2024 December<br> 31, 2023 – as restated
Accumulated Net Book Accumulated Net Book
Cost Depreciation Value Cost Depreciation Value
Capital assets<br> subject to depreciation:
Machinery and equipment 57,896 (930 ) 56,966 - - -
Land 4,119,895 - 4,119,895 361,674 - 361,674
Prepaid<br> Assets (CIP) 16,027,876 - 16,027,876 6,046,061 - 6,046,061
Mining rights 7,242,275 - 7,242,275 7,069,867 - 7,069,867
Exploration costs 2,443,615 - 2,443,615 - - -
Total<br> fixed assets $ 29,891,557 $ (930 ) $ 29,890,627 $ 13,477,602 $ - $ 13,477,602

Exploration costs as drilling, development and related costs are either classified as exploration and charged to operations as incurred, or capitalized, such as to assist with mine planning within a reserve area and whether the drilling or development costs relate to an ore body that has been determined to be commercially mineable and the expenditure embodies a probable future benefit that involves a capacity, singly or in combination with other assets. The basis of the mineral interest is amortized on a units-of-production basis.

Intangible Assets

Intangible

assets consist of cost of software under development (SAP implementation). The carrying value of these intangible assets as of June 30, 2024 and at December 31, 2023 was $408,933 and $45,777, respectively.

Accounts Payable and Accrued Liabilities– As Restated

SCHEDULE

OF ACCOUNTS PAYABLE AND ACCRUED LIABILITIES

June<br> 30, 2024 December<br> 31, 2023
Accounts payable<br> and other accruals $ 4,901,808 $ 3,588,074
Mineral rights payable - 1,080,783
Total $ 4,901,808 $ 4,668,857 
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NOTES

TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

NOTE

2 – COMPOSITION OF CERTAIN FINANCIAL STATEMENT ITEMS (CONTINUED)

Leases

FinanceLeases

For the reporting period ended June 30, 2024, no financial leases meeting the criteria outlined in ASC 842 have been identified.

OperatingLeases

Right of use (“ROU”) assets and lease liabilities are recognized at the lease commencement date based on the present value of the future lease payments over the lease term. When the rate implicit to the lease cannot be readily determined, we utilize our incremental borrowing rate in determining the present value of the future lease payments. The ROU asset includes any lease payments made and lease incentives received prior to the commencement date. Operating lease ROU assets also include any cumulative prepaid or accrued rent when the lease payments are uneven throughout the lease term. The ROU assets and lease liabilities may include options to extend or terminate the lease when it is reasonably certain that we will exercise that option. The ROU and lease liabilities are primarily related to commercial offices with third parties.

The

lease agreements have terms between 2 to 3 years and the liability was measured at the present value of the lease payments discounted using interest rates with a weighted average rate of 6.5% which was determined to be the Company’s incremental borrowing rate. The continuity of the lease liabilities is presented in the table below:

SCHEDULE

OF OPERATING LEASE LIABILITY

Lease<br> liabilities at December 31, 2023– as restated $ 358,760
Additions $ -
Interest expense $ 13,271
Lease payments $ (68,853 )
Foreign<br> exchange (36,315 )
Lease<br> liabilities at June 30, 2024– as restated $ 266,863
Current<br> portion $ 121,442
Non-current<br> portion $ 145,421

The maturity of the lease liabilities (contractual undiscounted cash flows) is presented in the table below:

SCHEDULE

OF CONTRACTUAL UNDISCOUNTED CASH FLOWS

Less than one<br> year $ 128,528
Year 2 $ 130,392
Year 3 $ 108,264
Year 4 $ -
Total<br> contractual undiscounted cash flows– as restated $ 367,184 
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LITHIUM CORPORATION

NOTES

TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

NOTE

2 – COMPOSITION OF CERTAIN FINANCIAL STATEMENT ITEMS (CONTINUED)

ConvertibleDebt

SCHEDULE

OF CONVERTIBLE DEBT

June<br> 30,<br><br>2024 December<br> 31,<br><br>2023
Due to Nanyang<br> Investment Management Pte Ltd 5,902,441 5,862,434
Due to Jaeger Investments<br> Pty Ltd 1,967,503 1,954,145
Due to Modha Reena Bhasker 983,740 977,072
Due to Clipper Group Limited 983,740 977,072
Total convertible debt $ 9,837,424 $ 9,770,724
Current portion $ 81,918 $ 67,024
Non-current portion $ 9,755,506 $ 9,703,700

On

November 7, 2023, the Company entered into a convertible note purchase agreement (the “Convertible Note”) with Mr. Martin Rowley (“Mr. Rowley”) and other investors to raise up to $20,000,000 in proceeds through the issuance of convertible promissory notes with the following key terms:

- Maturity<br> date: 36 months as from the date of issuance;
- Principal<br> repayment terms: due on maturity;
- Interest<br> rate: 6.5% per annum;
- Interest<br> payment terms: due semiannually in arrears until maturity, unless converted or redeemed earlier and payable at the election of the<br> holder in cash, in shares of common stock, or in any combination thereof;
- Conversion<br> right: the holder retains a right to convert all or any portion of the note into shares of the Company’s common stock at the<br> Conversion Price up until the maturity date; and
- Conversion<br> price: US$28.225/share
- Redemption<br> right: the Company shall vest a right to redeem the convertible notes if and when (i)<br> twelve months have passed since the loan origination and (ii) the volume weighted average price exceeded 125% of the conversion<br> price for 5 trading days within a 20-day trading period. However, if the Company notifies the holder of its election to redeem the<br> convertible note, the holder may then convert immediately at the conversion price.

On

November 7, 2023, the Company issued $10,000,024 in convertible promissory notes under the terms of the Convertible Note Purchase Agreement, and through June 30, 2024 there were no other purchases and sales of the convertible promissory notes pursuant to the Convertible Note Purchase Agreement.

In the three and six months ended June 30, 2024, the Company recorded the following in the consolidated statement of operations and comprehensive loss: (i) $162,055 and $324,110 in interest expense ($nil and $nil, for the three and six months ended June 30, 2023) and (ii) $25,903 and $51,806 in accretion expense ($nil and $nil, for the three and six months ended June 30, 2023).

DerivativeLiabilities

SCHEDULE

OF DERIVATIVE LIABILITIES

June<br> 30,<br><br>2024 December<br> 31,<br><br>2023
Derivative liability<br> – conversion feature on the convertible debt 174,586 486,303
Derivative<br> liability – other stock incentives 196,064 513,757
Total derivative liabilities $ 370,650 $ 1,000,060 
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NOTES

TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

NOTE

2 – COMPOSITION OF CERTAIN FINANCIAL STATEMENT ITEMS (CONTINUED)

a) Derivative liability – embedded conversion feature on convertible debt

On November 7, 2023, the Company issued convertible promissory notes to Mr. Rowley (a senior adviser to the Company and the father of Nicholas Rowley, the Company’s Vice President of Business Development), and other investors. In accordance with FASB ASC 815, the conversion feature of the convertible debt was determined to be an embedded derivative. As such, it was bifurcated from the host debt liability and was recognized as a derivative liability in the consolidated balance sheets. The derivative liability is measured at fair value through profit or loss.

At

December 31, 2023, the fair value of the embedded conversion feature was determined to be $486,304 using a Black-Scholes collar option pricing model with the following assumptions:

SCHEDULE

OF FAIR VALUE EMBEDDED CONVERSION PRICING MODEL ASSUMPTION

Value<br> cap Value<br> floor
Measurement date December<br> 31,<br><br>2023 December<br> 31, <br><br>2023
Number of options 354,297 354,297
Stock price at fair value<br> measurement date $ 31.2800 $ 31.2800
Exercise price $ 28.2250 $ 35.2813
Expected volatility 99.42 % 99.42 %
Risk-free interest rate 3.97 % 3.97 %
Dividend yield 0.00 % 0.00 %
Expected<br> term (years) 2.85 2.85

At

June 30, 2024, the fair value of the embedded conversion feature was determined to be $174,586 using a Black-Scholes collar option pricing model with the following assumptions:

Value<br> cap Value<br> floor
Measurement date June<br> 30,<br><br>2024 June<br> 30,<br><br>2024
Number of options 354,297 354,297
Stock price at fair value<br> measurement date $ 10.3800 $ 10.3800
Exercise price $ 28.2250 $ 35.2813
Expected volatility 96.23 % 96.23 %
Risk-free interest rate 4.52 % 4.52 %
Dividend yield 0.00 % 0.00 %
Expected<br> term (years) 2.36 2.36

In the Black-Scholes collar option pricing models, the expected volatilities were based on historical volatilities of the securities of the Company and its trading peers, and the risk-free interest rates were determined based on the prevailing rates at the grant date for U.S. Treasury Bonds with a term equal to the expected term of the instrument being valued.

In the three and six months ended June 30, 2024, the Company recognized a $124,228 gain and $311,717 gain, respectively, on changes in fair value of financial instruments in the consolidated statement of operations and comprehensive loss ($nil and $nil, in the three and six months ended June 30, 2023).

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NOTES

TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

NOTE

2 – COMPOSITION OF CERTAIN FINANCIAL STATEMENT ITEMS (CONTINUED)

b) Derivative liability – other stock incentives

The

employment agreement of a Vice President of the Company, dated September 30, 2023, provides for the issuance of shares of the Company’s common stock based on us achieving certain market capitalization milestones. As of June 30, 2024, the Company’s obligations under this employment agreement contemplates the issuance of additional shares of the Company’s common stock in five tranches, each representing 0.2% of the Company’s common stock outstanding at the time of vesting, with an expiry date of December 31, 2026 and market vesting conditions as follows:

- Tranche<br> 3: when the Company achieves a $400 million market capitalization
- Tranche<br> 4: when the Company achieves a $500 million market capitalization
- Tranche<br> 5: when the Company achieves a $600 million market capitalization
- Tranche<br> 6: when the Company achieves a $800 million market capitalization
- Tranche<br> 7: when the Company achieves a $1.0 billion market capitalization

In accordance with FASB ASC 815, these RSU awards were classified as a liability, measured at fair value through profit or loss, and compensation expense is recognized over the expected term.

As at June 30, 2024, Tranche 3, Tranche 4, Tranche 5, Tranche 6 and Tranche 7 remain outstanding and unvested, and the total fair value of these outstanding rights to receive restricted stock was $850,089, as measured using a Monte Carlo Simulation with the following ranges of assumptions: the Company’s stock price on the June 30, 2024 measurement date, expected dividend yield of 0%, expected volatility between 71.2% and 82.3%, risk-free interest rate between a range of 5.09% to 5.48%, and an expected term of 2.5 years. The expected volatilities were based on historical volatilities of the securities of the Company and its trading peers, and the risk-free interest rates were determined based on the prevailing rates at the grant date for U.S. Treasury Bonds with a term equal to the expected term of the award being valued.

As

at December 31, 2023, Tranche 3, Tranche 4, Tranche 5, Tranche 6 and Tranche 7 remain outstanding and unvested, and the total fair value of these outstanding rights to received restricted stock was $1,550,576, as measured using a Monte Carlo Simulation with the following ranges of assumptions: the Company’s stock price on the December 31, 2023 measurement date, expected dividend yield of 0%, expected volatility between 72.3% and 89.3%, risk-free interest rate between a range of 4.79% to 5.41%, and an expected term between 3 months and 12 months. The expected volatilities were based on historical volatilities of the securities of the Company and its trading peers, and the risk-free interest rates were determined based on the prevailing rates at the grant date for U.S. Treasury Bonds with a term equal to the expected term of the award being valued.

NOTE

3 – DEFERRED OTHER INCOME

On

May 2, 2023, the Company and Atlas Litio Brasil Ltda. (the “Company Subsidiary”), entered into a Royalty Purchase Agreement (the “Purchase Agreement”) with Lithium Royalty Corp., a Canadian company listed on the Toronto Stock Exchange (“LRC”). The transaction contemplated under the Purchase Agreement closed simultaneously on May 2, 2023, whereby the Company Subsidiary sold to LRC in consideration for $20,000,000 in cash, a royalty interest equaling 3% of the gross revenue (the “Royalty”) to be received by the Company Subsidiary from the sale of products from certain 19 mineral rights and properties that are located in Brazil and held by the Company Subsidiary.

On

the same day, the Company Subsidiary and LRC entered into a Gross Revenue Royalty Agreement (the “Royalty Agreement”) pursuant to which the Company Subsidiary granted LRC the Royalty and undertook to calculate and make royalty payments on a quarterly basis commencing from the first receipt of the sales proceeds with respect to the products from the Property. The Royalty Agreement contains other customary terms, including but not limited to, the scope of the gross revenue, the Company Subsidiary’s right to determine operations, and LRC’s information and audit rights. Under the Royalty Agreement, the Company Subsidiary also granted LRC an option to purchase additional royalty interests with respect to certain additional Brazilian mineral rights and properties on the same terms and conditions as the Royalty, at a total purchase price of $5,000,000.

NOTE

4 – OTHER NONCURRENT LIABILITIES

Other noncurrent liabilities are comprised solely of tax refinancing programs at our operating subsidiaries located in Brazil. The balance of these

tax liabilities as of June 30, 2024, and December 31, 2023, amounted to $22,892 and $58,579, respectively.

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NOTES

TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

NOTE

5 – STOCKHOLDERS’ EQUITY

AuthorizedStock and Amendments

On July 18, 2022, the board of directors of the Company (the “Board of Directors” or “Board”) approved a reverse stock split of the Company’s issued and outstanding shares of common stock at a ratio of 1-for-750 without affecting the number of shares of authorized common stock (the “Originally Intended Reverse Stock Split”). The holder of the majority voting power of our voting stock (the “Majority Stockholder”) approved the Originally Intended Reverse Stock Split by written consent on July 18, 2022, in lieu of a meeting of stockholders as permitted under the Nevada Revised Statute (“NRS”) Section 78.320(2) and the company’s bylaws, as then amended (the “Bylaws”).

On December 20, 2022, the Company made the appropriate filings with the Secretary of State of the State of Nevada (“SOS”) that were intended to effect the Originally Intended Reverse Stock Split (the “Original Articles Amendment”). In April 2023, the Board determined that due to an error, the Original Articles Amendment was a nullity and that it would be in the best interest of the Company to take corrective action to remedy the inaccuracy and to file the documents that would have been necessary to effectuate a 1-for-750 reverse stock split of the issued and outstanding common stock with a corresponding split of the authorized common stock (the “Rectified Reverse Stock Split”) and then immediately thereafter increase the number of shares of authorized common stock back to the number it was prior to the Rectified Reverse Stock Split as of December 20, 2022.

On April 21, 2023, the Board authorized and approved the necessary documents and filings with the SOS to decrease the number of the Company’s issued and outstanding shares of common stock and correspondingly decrease the number of authorized shares of common stock, each at a ratio of 1-for-750, retroactively effective as of December 20, 2022, without a vote of the stockholders, as pursuant to the NRS, no stockholder approval was required. Also on April 21, 2023, the Board and the Majority Stockholder approved an Authorized Capital Increase Amendment to increase the authorized number of shares of common stock from 5,333,334 shares to 4,000,000,000 shares retroactively as of December 20, 2022, in accordance with the Board’s and stockholders’ original intent in effecting the Originally Intended Reverse Stock Split.

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NOTES

TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

NOTE

5 – STOCKHOLDERS’ EQUITY (CONTINUED)

Further,

the Board determined that it was advisable and in the best interests of the Company to amend and restate the Company’s articles of incorporation to decrease the number of shares of authorized common stock to two hundred million (200,000,000) and to amend certain other provisions in the Company’s articles (the “Amended and Restated Articles”). The Board and the Majority Stockholder determined to decrease the number of shares of authorized common stock to reduce the number of shares available for issuance given the negative perception the dilutive effect of having such a large number of shares available for issuance may have on any potential future efforts to attract additional financing. On April 21, 2023, the Board and the Majority Stockholder approved the Amended and Restated Articles. On May 25, 2023, the Company made the appropriate filings with the SOS to effect the changes as described above.

On May 25, 2023, the Company also filed with the SOS a Certificate of Withdrawal of Designation of the Series B Convertible Preferred Stock and a Certificate of Withdrawal of Designation of the Series C Convertible Preferred which were effective as of May 25, 2023.

As

of December 31, 2023 and June 30, 2024, the Company had 200,000,000 authorized shares of common stock, with a par value of $0.001 per share.

SeriesA Preferred Stock

On December 18, 2012, the Company filed with the SOS a Certificate of Designations, Preferences and Rights of Series A Convertible Preferred Stock (“Series A Stock”) to designate one share of a new series of preferred stock. The Certificate of Designations, Preferences and Rights of Series A Convertible Preferred Stock provides that for so long as Series A Stock is issued and outstanding, the holders of Series A Stock shall vote together as a single class with the holders of the Company’s common stock, with the holders of Series A Stock being entitled to 51% of the total votes on all such matters regardless of the actual number of shares of Series A Stock then outstanding, and the holders of common stock are entitled to their proportional share of the remaining 49% of the total votes based on their respective voting power. The one outstanding share of our Series A Stock has been held by our Chief Executive Officer and Chairman, Mr. Marc Fogassa since December 18, 2012, a period greater than 11 years.

SeriesD Preferred Stock

On September 16, 2021, the Company filed with the SOS a Certificate of Designations, Preferences and Rights of Series D Convertible Preferred Stock (“Series D Stock”) to designate 1,000,000 shares of a new series of preferred stock. The Certificate of Designations, Preferences and Rights of Series D Convertible Preferred Stock (the “Series D COD”) provides that for so long as Series D Stock is issued and outstanding, the holders of Series D Stock shall have no voting power until such time as the Series D Stock is converted into shares of common stock. Pursuant to the Series D COD one share of Series D Stock is convertible into 10,000 shares of common stock and may be converted at any time at the election of the holder. Giving effect to the Reverse Stock Split discussed above, each share of Series D Stock is effectively convertible into 13 and 1/3 shares of common stock. Holders of the Series D Stock are not entitled to any liquidation preference over the holders of common stock and are entitled to any dividends or distributions declared by the Company on a pro rata basis. There were no shares of Series D Stock outstanding as of June 30, 2024 or December 31, 2023.

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NOTES

TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

NOTE

5 – STOCKHOLDERS’ EQUITY (CONTINUED)

Six**Months Ended June 30, 2023Transactions

On

January 9, 2023, the Company entered into an underwriting agreement (the “Underwriting Agreement”) with EF Hutton, division of Benchmark Investments, LLC, as representative of the underwriters named therein (the “Representative”), pursuant to which the Company agreed to sell an aggregate of 675,000

shares of the Company’s common stock, to

the Representative, at a public offering price of $6.00

per share (the “Offering Price”)

in a firm commitment public offering (the “Offering”). The Company also granted the Representative a 45-day option to purchase up to 101,250 additional shares of the Company’s common stock upon the same terms and conditions for the purpose of covering any over-allotments in connection with the Offering (the “Over-Allotment Option”). On January 11, 2023, the Representative delivered its notice to exercise the Over-Allotment Option in full.

The shares of common stock were offered by the Company pursuant to a registration statement on Form S-1, as amended (File No. 333-262399) filed with the SEC and declared effective on January 9, 2023 (the “Registration Statement”). The consummation of the Offering took place on January 12, 2023 (the “Closing”).

In

connection with the Closing, the Company issued to the Representative, and/or its permitted designees, as a portion of the underwriting compensation payable to the Representative, warrants to purchase an aggregate of 33,750 shares of common stock, equal to 5% of the number of shares of common stock sold in the Offering (excluding the Over-Allotment Option), at an exercise price of $7.50, equal to 125% of the Offering Price (the “Representative’s Warrants”). The Representative’s Warrants are exercisable for a period of five years from the effective date of the Registration Statement, provided that they are subject to a mandatory lock-up for 180 days from the commencement of sales of the Offering in accordance with FINRA Rule 5110(e). Aggregate gross proceeds from the Offering were $4,657,500.

On

January 30, 2023, the Company entered into a Securities Purchase Agreement (the “Purchase Agreement”) with two investors (the “Investors”), pursuant to which the Company agreed to issue and sell to the Investors in a Regulation S private placement (the “Private Placement”) an aggregate of 640,000 restricted shares of the Company’s common stock (the “Shares”). The purchase price for the Shares was $6.25 per share, for total gross proceeds of $4,000,000. The Private Placement transaction closed on February 1, 2023.

On February 1, 2023, the Company acquired one mineral right totaling 45.77

hectares located in the municipalities of Araçuaí and Itinga, in a region known as “Lithium Valley” in the state of Minas Gerais in Brazil. The purchase consideration paid totaled $1,150,000 including $400,000 paid in cash on January 19, 2023 and $750,000 paid in restricted shares of Common Stock of the Company on February 1, 2023.

On May 26, 2023, our CEO elected to convert 214,006 shares of Series D Stock, representing

all of his outstanding shares of Series D Stock at that time, into shares of common stock. As a result, of such conversion, the Company issued to our CEO 2,853,413 new shares of common stock.

Additionally,

during the six months ended June 30, 2023, the Company sold an aggregate of 192,817 shares of our common stock to Triton Funds, LP for total gross proceeds of $1,675,797 pursuant to a Common Stock Purchase Agreement (the “CSPA”) entered into between the Company and Triton Funds, LP, dated February 26, 2021. For a description of the transactions contemplated under the CSPA, please refer to our Form 8-K filed with the SEC on March 2, 2021.

Lastly, during the six months ended June 30, 2023, the Company issued 5,206 shares of common stock to officers and

consultants in compensation for services rendered.

Six**Months Ended June 30, 2024 Transactions

During

the six months ended June 30, 2024, the Company issued 2,059,711 new shares of Common Stock, including (i) 1,871,250 shares issued to an accredited investor for gross proceeds of $30,000,000 pursuant to a March 28, 2024 subscription agreement with Mitsui & Co., Ltd. (“Mitsui”), and (ii) 188,461 shares issued to consultants, officers and directors upon vesting of restricted stock units.

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NOTES

TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

NOTE

5 – STOCKHOLDERS’ EQUITY (CONTINUED)

CommonStock Options

During the six months ended June 30, 2024 and 2023, the Company granted options to purchase common stock to officers, consultants and non-management directors. The options were valued using the Black-Scholes option pricing model with the following ranges of assumptions:

SCHEDULE OF BLACK-SCHOLES OPTION PRICING MODEL

June 30, 2024 June 30, 2023
Expected<br> volatility 90.41% – 136.11 103.60% – 104.08
Risk-free<br> interest rate 3.78%<br> – 4.79 3.40% – 3.82
Stock price<br> on date of grant 31.28<br> –31.28 7.22<br>– 19.75
Dividend<br> yield 0.00 0.00
Illiquidity<br> discount - -
Expected<br> term 1<br> to 5 years 1.5 years

All values are in US Dollars.

Changes in common stock options for the six months ended June 30, 2024 and 2023 were as follows:

SCHEDULE OF COMMON STOCK OUTSTANDING

Number<br> of Options Outstanding and Vested Weighted<br> Average Exercise Price Remaining<br> Contractual Life (Years) Aggregated<br> Intrinsic Value
Outstanding and vested, January<br> 1, 2024 50,667 $ 15.9474 2.40 $ 776,864
Issued (1) 429,996 0.0077
Exercised - -
Outstanding and vested,<br> June 30, 2024 480,664 $ 1.6879 8.16 $ 4,562,782
Number<br> of Options Outstanding and Vested Weighted<br> Average Exercise Price Remaining<br> Contractual Life (Years) Aggregated<br> Intrinsic Value
--- --- --- --- --- --- --- --- --- ---
Outstanding and vested, January<br> 1, 2023 178,672 $ 0.1219 1.55 $ 1,228,922
Issued (2) 40,000 7.00
Exercised (3) (16,000 ) 0.75
Outstanding and vested,<br> June 30, 2023 242,672 $ 4.4907 1.76 $ 4,446,894
1) In<br> the six months ended June 30, 2024, 429,996 common stock options were issued with a grant<br> date fair value of $13,447,502.
--- ---
2) In<br> the six months ended June 30, 2023, 40,000 common stock options were issued with a grant<br> date fair value of $446,726.
3) In<br> the six months ended June 30, 2023, common stock option holders exercised a total 16,000<br> options at a weighted average exercise price of $0.75 to purchase 15,458 shares of the Company’s<br> common stock. The exercises were paid for with 542 options conceded in cashless exercises.<br> As a result of the options exercised, the Company issued 15,458 shares of common stock.

During

three and six months ended June 30, 2024, the Company recorded $3,352,664 and $6,668,487 in stock-based compensation expense from common stock options in the consolidated statements of operations and comprehensive loss ($324,801 and $446,726, during the three and six months ended June 30, 2023).

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NOTES

TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

NOTE

5 – STOCKHOLDERS’ EQUITY (CONTINUED)

SeriesD Preferred Stock Options

As of and for the six months ended June 30, 2024, the Company had no Series D preferred stock options outstanding and no shares of Series D Stock outstanding. During the six months ended June 30, 2023, the Company granted options to purchase series D stock to two of the Company’s directors. All Series D preferred stock options vested immediately at the grant date and were exercisable for a period of ten years from the date of issuance. The options were valued using the Black-Scholes option pricing model with the following ranges of assumptions:

SCHEDULE OF OPTIONS FAIR VALUE ASSUMPTIONS

June 30, 2023
Expected<br> volatility 139.15%<br> – 154.32
Risk-free<br> interest rate 3.42%<br> - 3.99
Stock price<br> on date of grant 7.00<br> - 38.89
Dividend<br> yield 0.00
Illiquidity<br> discount 75
Expected<br> term 5<br> years

All values are in US Dollars.

Changes in Series D preferred stock options for the six months ended June 30, 2023 were as follows:

SCHEDULE OF PREFERRED STOCK

Number<br> of Options Outstanding and Vested Weighted<br> Average Exercise Price (1) Remaining Contractual<br> <br>Life (Years) Aggregated<br> Intrinsic Value
Outstanding<br> and vested, January 1, 2023 72,000 $ 0.10 8.94 $ 6,712,800
Issued (2) 18,000 0.10
Outstanding<br> and vested, June 30, 2023 90,000 $ 0.10 8.82 $ 27,122,500
(1) Represents<br> the exercise price required to purchase one share of Series D Stock, which is convertible into 13 and 1/3 shares of common stock<br> at any time at the election of the holder.
--- ---
(2) In<br> the six months ended June 30, 2023, 18,000 Series D preferred stock options were issued with a total grant date fair value of $1,003,483.
--- ---

During the three and six months ended June 30, 2024, the Company recorded $nil and $nil, respectively, in stock-based compensation expense from Series D preferred stock options in the consolidated statements of operations and comprehensive loss ($736,224 and $1,003,483, respectively, during the three and six months ended June 30, 2023).

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NOTES

TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

NOTE

5 – STOCKHOLDERS’ EQUITY (CONTINUED)

CommonStock Purchase Warrants

Common stock purchase warrants are accounted for as equity in accordance with ASC 480, Accounting for Derivative Financial Instruments Indexedto, and Potentially Settled in, a Company’s Own Stock, Distinguishing Liabilities from Equity.

During the six months ended June 30, 2024, the Company did not issue any common stock purchase warrants. During the six months ended June 30, 2023, the Company issued common stock purchase warrants to investors, finders and brokers in connection with the Company’s equity financings. All warrants vest within 180 days from issuance and are exercisable for a period of one to five years from the date of issuance. The common stock purchase warrants were valued using the Black-Scholes option pricing model with the following ranges of assumptions:

SCHEDULE OF WARRANT ASSUMPTION

June 30, 2023
Expected<br> volatility 196.40
Risk-free<br> interest rate 3.43%<br> - 3.54
Stock price<br> on date of grant $ 8.10<br> - 18.00
Dividend<br> yield 0.00
Expected<br> term 5s<br> years

All values are in US Dollars.

Changes in common stock purchase warrants for the six months ended June 30, 2024 and June 30, 2023 were as follows:

SCHEDULE OF WARRANT ACTIVITY

Number<br> of Warrants Outstanding and Vested Weighted<br> Average Exercise Price Weighted<br> Average Contractual Life (Years) Aggregated Intrinsic<br> <br>Value
Outstanding and vested, January<br> 1, 2024 55,671 $ 10.6087 1.34 $ 1,152,654
Number of Options Outstanding and Vested, Warrants issued - - - -
Weighted Average Exercise Price, Warrants issued - - - -
Outstanding and vested,<br> June 30, 2024 55,671 $ 10.6087 0.85 $ 107,777
Number<br> of Warrants Outstanding and Vested Weighted<br> Average Exercise Price Weighted<br> Average Contractual Life (Years) Aggregated Intrinsic<br> <br>Value
--- --- --- --- --- --- --- --- --- ---
Outstanding and vested, January<br> 1, 2023 321,759 $ 12.8634 1.30 $ -
Warrants issued (1) 234,736 $ 8.1336
Warrants exercised (2) (388,688 ) $ 7.6496
Outstanding and vested,<br> June 30, 2023 355,509 $ 9.9124 1.65 $ 1,917,556
1) The warrants issued in the six months ended June 30, 2023 had a total grant<br>date fair value of $2,156,793.
--- ---
2) During the six months ended June 30, 2023, warrant holders exercised a total<br>388,688 warrants to purchase 342,114 shares of the Company’s common stock. The warrant exercises were executed with exercise prices<br>ranging between $5.1085 and $8.3325 per share and were paid for with (i) $844,039 in cash proceeds to the Company and (ii) 46,573 warrants<br>conceded in cashless exercises. As a result of the warrants exercised, the Company issued an aggregate of 342,114 common shares.

During the three and six months ended June 30, 2024, the Company recorded the following as a result of the common stock purchase warrant activity: (i) $nil and $nil, respectively, in stock-based compensation expense in the consolidated statements of operations and comprehensive loss ($1,961,661 and $1,961,661, respectively, during the three and six months ended June 30, 2023), and (ii) $nil and $nil, respectively, in share issuance costs in the consolidated statement of changes in equity ($nil and $147,848, respectively, during the three and six months ended June 30, 2023).

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NOTES

TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

NOTE

5 – STOCKHOLDERS’ EQUITY (CONTINUED)

RestrictedStock Units (“RSUs”)

Restricted stock units (“RSUs”) are granted by the Company to its officers, consultants and directors of the Company as a form of stock-based compensation. The RSUs are granted with varying immediate-vesting, time-vesting, performance-vesting, and market-vesting conditions as tailored to each recipient. Each RSU represents the right to receive one share of the Company’s common stock immediately upon vesting.

Changes in RSUs for the six months ended June 30, 2024 and June 30, 2023 were as follows:

SCHEDULE OF CHANGE IN RESTRICTED STOCK UNITS

Number<br> of <br> RSUs Outstanding
Outstanding at January 1, 2024 1,040,017
Granted (1) 45,306
Vested (2) (188,461 )
Expired (3) (10,000 )
Outstanding at June 30, 2024 886,862
Number<br> of <br> RSUs Outstanding
--- --- --- ---
Outstanding at January 1, 2023 -
Granted (4) 248,900
Vested (5) (88,141 )
Outstanding at June 30, 2023 160,759
1) 45,306 RSUs were granted to officers and consultants of the Company, with<br>a total grant date fair value of $895,236 as measured at $19.76/share using the Company’s 20-day volume weighted average price trailing<br>to the date the RSU was granted, as follows: (i) 27,980 RSUs which immediately vested upon grant and (ii) 17,326 RSUs with time-based<br>vesting in equal monthly installments over six months.
--- ---
2) 188,461 RSUs vested and were settled through the issuance of 188,461 shares<br>of common stock.
3) 10,000 RSUs were cancelled without vesting because the performance conditions<br>for vesting were not met.
4) 248,900 RSUs were granted to directors, officers, and consultants of the<br>Company, with a total grant date fair value of $3,276,345 as measured at $13.54/share using the Company’s 20-day volume weighted<br>average price trailing to the date the RSU was granted, as follows: (i) 161,136 RSUs which immediately vested upon grant, (ii) 63,764<br>RSUs with time-based vesting in equal annual installments over three years, and (iii) 24,000 RSUs with time-based vesting in equal annual<br>installments over four years.
5) 88,141 RSUs vested and were settled through the issuance of 88,141 shares<br>of common stock.

During

the three and six months ended June 30, 2024, the Company recorded $2,210,613 and $5,102,316 in stock-based compensation expense from the Company’s RSU activity in the period ($285,313 and $649,062, respectively, during the three and six months ended June 30, 2023). As of June 30, 2024, there were 798,209 RSUs outstanding and rights to receive 88,653 shares of common stock as a result of RSU vesting (December 31, 2023: 924,364 RSUs outstanding and rights to receive 115,653 shares of common stock as a result of RSU vesting).

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LITHIUM CORPORATION

NOTES

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NOTE

5 – STOCKHOLDERS’ EQUITY (CONTINUED)

Other stock incentives measured at fair value through profit or loss

As

of June 30, 2024, the Company had certain other outstanding obligations to issue shares of the Company’s common stock in case some markets conditions are met pursuant to an officer’s employment agreement, as further disclosed in the ‘Derivative liabilities’ section above. These were designated as liability-classified awards and are measured at fair value through profit or loss. As of June 30, 2024, the company recognized a $196,064 derivative liability and would have been obligated to issue 148,245

shares

of common stock pursuant to these other stock incentives had the conditions of such stock incentives been met (December 31, 2023: recognized a $513,757

derivative

liability relating to 127,535 shares of common stock that the Company would have been obligated to issue had the conditions of the stock incentives been met).

NOTE

6 – COMMITMENTS AND CONTINGENCIES

Commitments

The following table summarizes certain of Atlas’s contractual obligations at June 30, 2024 (in thousands):

SCHEDULE OF CONTRACTUAL OBLIGATIONS

Total Less than 1 Year 1-3 Years 3-5 Years More than 5 Years
Lithium processing plant construction (1) $ 4,644,173 $ 4,644,173 $ - $ - $ -
Total 4,644,173 4,644,173 - - -
(1) Lithium<br> processing plant construction obligations are related to agreements with suppliers contracted for the construction of the processing<br> plant, with the majority of payments due upon delivery.
--- ---

Please see commitments related to Leases in Note 2.

NOTE

7 – RELATED PARTY TRANSACTIONS

Related party transactions are recorded at the exchange amount transacted as agreed between the Company and the related party. All the related party transactions have been reviewed and approved by the Board.

The Company’s related parties include:

SCHEDULE OF RELATED PARTIES

Martin<br> Rowley Mr.<br> Rowley is a senior advisor to the Company. In 2023, the Company entered into a Convertible Note Purchase Agreement with Mr. Rowley<br> relating to the issuance to Mr. Rowley along with other experienced lithium investors of convertible notes. Mr. Rowley is the<br> father of Nicholas Rowley, the Company’s Vice President of Business Development.
Jaeger<br> Investments Pty Ltd (“Jaeger”) Jaeger<br> Investments Pty Ltd is a corporation in which senior advisor, Mr. Rowley, is a controlling shareholder.
RTEK<br> International DMCC (“RTEK”) RTEK<br> International DMCC is a corporation in which Nicholas Rowley, our Vice President of Business Development, and Brian Talbot, our<br> Chief Operating Officer and a member of our Board as of April 1, 2024 are controlling shareholders.
Shenzhen<br> Chengxin Lithium Group Co., Ltd Shenzhen<br> Chengxin Lithium Group Co., Ltd is a non-controlling shareholder.
Sichuan<br> Yahua Industrial Group Co., Ltd Sichuan<br> Yahua Industrial Group Co., Ltd, is a non-controlling shareholder.

Technical Services Agreement:

In July 2023, the Company entered into a technical service agreement (“Technical Services Agreement”) with RTEK pursuant to which RTEK agreed to provide the Company certain mining engineering, planning and business development services.  Messrs. Nick Rowley and Brian Talbot are the founders and principals of RTEK.  On March 31, 2024, the Technical Services Agreement was amended and restated (the “Amended and Restated RTEK Agreement”) to reflect that part of the compensation originally scheduled to be paid to RTEK was allocated as compensation for Mr. Talbot in connection with his appointment as the Company’s director and Chief Operating Officer. Under the terms of the Amended and Restated RTEK Agreement, the Company will issue RTEK RSUs for (i) 75,000 (seventy-five thousand) fully paid shares of the Company’s stock vesting on the successful completion of certain performance criteria outlined in the Amended and Restated R-TEK Agreement; RSUs for 100,000 (one hundred thousand) fully paid shares of the Company’s common stock vesting upon completion of other identified performance criteria; and RSUs for 100,000 (one hundred thousand) fully paid shares of the Company’s common stock vesting upon on the delivery of a working plant as defined in the Amended and Restated RTEK Agreement. Any unvested RSUs shall immediately vest in the event of a Change in Control (as defined in the Company’s 2023 Equity Incentive Plan).

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NOTES

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NOTE

7 – RELATED PARTY TRANSACTIONS (CONTINUED)

Convertible Note Purchase Agreement:

In November 2023, the Company entered into a Convertible Note Purchase Agreement with Mr. Rowley relating

to the issuance to Mr. Rowley along with other experienced lithium investors, of convertible promissory notes with an aggregate total principal amount of $10.0 million, accruing interest at a rate of 6.5% per annum. Pursuant to the Convertible Note Purchase Agreement, Mr. Rowley, through Jaeger, purchased an aggregate of $1,967,503.0 of the Notes. The Notes will mature in November 2026.

Offtake and Sales Agreements:

In December 2023, the Company entered into Offtake and Sales Agreements with each of Sichuan Yahua Industrial Group

Co., Ltd. and Sheng Wei Zhi Yuan International Limited, a subsidiary of Shenzhen Chengxin Lithium Group Co., Ltd., pursuant to which the Company agreed, for a period of five (5) years, to sell to each buyer 60,000 dry metric tonnes of lithium concentrate (the “Product”) per year, subject to the Company’s authority to increase or decrease such quantity by up to ten percent (10%) each year. Each of the buyers agreed to pre-pay to the Company $20.0 million (each, a “Pre-Payment Amount”) for future deliveries of the Product after the Company obtains customary licenses. Each Pre-Payment Amount will be used to offset against such buyer’s future payment obligations for the Product.

On

March 28, 2024, the Company entered into a Securities Purchase Agreement (the “Purchase Agreement”) with Mitsui through which it sold and issued an aggregate of 1,871,250

shares of its Common Stock in a registered direct

offering (the “Registered Offering”) at a purchase price of $16.0321 per share. The Purchase Agreement contains customary representations and warranties, covenants and indemnification rights and obligations of the Company and the Investor. The closing occurred on April 4, 2024.

The

gross proceeds from the Registered Offering were $30.0 million before deducting related offering expenses. The Company intends to use the net proceeds from the Registered Offering primarily for general corporate purposes, including the development and commercialization of its products, general and administrative expenses, and working capital and capital expenditures.

In connection with the closing of the Registered Offering, our subsidiary Atlas Brasil and the Investor entered into an Offtake and Sales Agreement, pursuant to which Atlas Brazil agreed to sell and deliver to the Investor, and the Investor agreed to purchase and take delivery of, (i) the spot quantity of fifteen thousand (15,000) dry metric tons of Atlas Brazil’s product, and, subject to the fulfillment of certain conditions precedent, (ii) up to sixty thousand (60,000) dry metric tons of Atlas Brazil’s product for each year, up to a total of three hundred thousand (300,000) dry metric tons.

The related parties outstanding amounts and expenses as of June 30, 2024 and December 31, 2023 are shown below:

SCHEDULE OF RELATED PARTIES OUTSTANDING AMOUNT AND EXPENSES

June 30, 2024 December 31, 2023
Accounts Payable / Debt Expenses / Payments Accounts Payable / Debt Expenses / Payments
RTEK International $ - $ 2,049,378 $ - $ 1,449,000
Jaeger Investments Pty Ltd. $ 1,967,503 $ 64,823 $ 1,954,145 $ 13,405
Total $ 1,967,503 $ 2,114,201 $ 1,954,145 $ 1,462,405

In the course of preparing consolidated financial statements, we eliminate the effects of various transactions conducted between Atlas and its subsidiaries and among the subsidiaries.

JupiterGold Corporation

During

the six months ended June 30, 2024, Jupiter Gold settled a $23,000 remaining balance due of compensation owed to Marc Fogassa in his role as Jupiter Gold’s CEO, as of June 30, 2024 through the issuance of 23,781 shares of common stock of Jupiter Gold at a price of $0.84 per share.

Also

during the six months ended June 30, 2024, Jupiter Gold granted its CEO options to purchase an aggregate of 210,000 shares of its common stock at prices ranging between $0.01 to $1.00 per share. The options were valued at $42,000 and recorded to stock-based compensation. The options were valued using the Black-Scholes option pricing model with the following average assumptions: the Jupiter Gold’s stock price on the date of the grant ($0.74 to $1.00), an illiquidity discount of 75%, expected dividend yield of 0%, historical volatility calculated between 241% and 312%, risk-free interest rate between a range of 3.88% to 4.64%, and an expected term between 5 and 10 years. During the six months ended June 30, 2024, Jupiter Gold’s CEO exercised a total 1,350,000 options at a $0.01 weighted average exercise price. These exercises were paid for with $13,500 in cash. As a result of the options exercised, the Company issued 1,350,000 shares of common stock to its CEO. As of June 30, 2024, options to purchase an aggregate of 70,000 shares of common stock of Jupiter Gold common were outstanding with a weighted average life of 4.38 years at a weighted average exercise price of $1.00 and an aggregated intrinsic value of $1,400.

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ATLAS

LITHIUM CORPORATION

NOTES

TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

NOTE

7 – RELATED PARTY TRANSACTIONS (CONTINUED)

During the six months ended June 30, 2023, Jupiter Gold granted options to purchase an aggregate of 210,000 shares of its common stock to its CEO at prices ranging between $0.01 to $1.00 per share. The options were valued at $71,841 and recorded to stock-based compensation. The options were valued using the Black-Scholes option pricing model with the following average assumptions: the Jupiter Gold’s stock price on the date of the grant which ranged from $1.10 to $2.10, expected dividend yield of 0%, historical volatility calculated ranging from 298% to 371%, risk-free interest rate between a range of 3.42% to 3.99%, and an expected term between five and ten years. During the six months ended June 30, 2023, Jupiter Gold’s CEO exercised a total 1,115,000 options at a $0.98 weighted average exercise price. These exercises were paid for with 386,420 options conceded in cashless exercises. As a result of the options exercised, Jupiter Gold issued 728,580 shares of common stock to its CEO. As of June 30, 2023, options to purchase an aggregate of 1,000,000 shares of common stock of Jupiter Gold were outstanding with a weighted average life of 8.56 years at a weighted average exercise price of $0.0199 and an aggregated intrinsic value of $1,080,100.

On June 13, 2023, the Company purchased 320,700 shares of Jupiter Gold common stock at $1.00 per share.

ApolloResources Corporation

During the six months ended June 30, 2024, Apollo

Resources settled a $8,000 remaining balance due of compensation owed to Mr. Fogassa in his role as Apollo Resources’ CEO, as of June 30, 2024 through the issuance of 1,334 shares of common stock of Apollo Resources at a price of $6.00 per share.

Also during the six months ended June 30, 2024, Apollo Resources granted options to purchase an aggregate of 90,000

shares

of its common stock to its CEO at a price of $0.01

per

share. The options were valued at $134,408

and

recorded to stock-based compensation. The options were valued using the Black-Scholes option pricing model with the following average assumptions: the Apollo Resources’ stock price on the date of the grant ($6.00 ), an illiquidity discount of 75%, expected dividend yield of 0

%,

historical volatility calculated between 16.61

%

and 17.41

%,

risk-free interest rate between a range of 3.88

%

to 4.64 %, and an expected term of 10

years.

During the six months ended June 30, 2024, Apollo Resources’ CEO exercised a total 495,000 options at a $0.01 weighted average exercise price. These exercises were paid for with $4,950 in cash. As a result of the options exercised, Apollo Resources issued 495,000 shares of common stock to its CEO. As of June 30, 2024, no Apollo Resources common stock options were outstanding.

During the six months ended June 30, 2023, Apollo Resources granted its CEO options to purchase an aggregate of 90,000 shares of its common stock at a price of $0.01 per share. The options were valued at $111,874 and recorded to stock-based compensation. The options were valued using the Black-Scholes option pricing model with the following average assumptions: the Apollo Resources’ stock price on the date of the grant which was $5.00, an illiquidity discount of 75%, expected dividend yield of 0%, historical volatility calculated ranging from 53.2% to 58.0%, risk-free interest rate between a range of 3.42% to 3.99%, and an expected term of ten years. As of June 30, 2023, options to purchase an aggregate 315,000 shares of common stock of Apollo Resources were outstanding with a weighted average life of 9.10 years at a weighted average exercise price of $0.01 and an aggregated intrinsic value of $1,571,850.

NOTE

8 – RISKS AND UNCERTAINTIES

CurrencyRisk

The Company operates primarily in Brazil which exposes it to currency risks. The Company’s business activities may generate intercompany receivables or payables that are in a currency other than the functional currency of the Company. Changes in exchange rates from the time the activity occurs to the time payments are made may result in the Company receiving either more or less in local currency than the local currency equivalent at the time of the original activity.

The Company’s consolidated financial statements are denominated in U.S. dollars. Accordingly, changes in exchange rates between the applicable foreign currency and the U.S. dollar affect the translation of each foreign subsidiary’s financial results into U.S. dollars for purposes of reporting in the consolidated financial statements. The Company’s foreign subsidiaries translate their financial results from the local currency into U.S. dollars in the following manner: (a) income statement accounts are translated at average exchange rates for the period; (b) balance sheet asset and liability accounts are translated at end of period exchange rates; and (c) equity accounts are translated at historical exchange rates. Translation in this manner affects the shareholders’ equity account referred to as the foreign currency translation adjustment account. This account exists only in the foreign subsidiaries’ U.S. dollar balance sheets and is necessary to keep the foreign subsidiaries’ balance sheets in agreement.

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ATLAS

LITHIUM CORPORATION

NOTES

TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

NOTE

9 – SUBSEQUENT EVENTS

Contracttermination agreement

On July 1, 2024, the Company entered into a contract termination agreement with a private advisory firm pursuant to which the Company agreed to pay the following consideration immediately on execution of the agreement:

(i) $250,000 in cash and (ii) 400,000 in restricted shares, of which 200,000 restricted shares of common stock are subject to a twelve-month lock-up period and 200,000 restricted

shares of common stock are subject to a six-month lock-up period. As the termination occurred subsequent to June 30, 2024, this contract termination did not have any impact on the condensed interim consolidated financial statements presented herein.

Resignationof Chief Financial Officer

On July 17, 2024, Gustavo P. Aguiar resigned as the Company’s Chief Financial Officer (serving as the principal financial and accounting officer) and Treasurer of the Company. Mr. Aguiar’s resignation was not due to any disagreement with the Company on any matter relating to the Company’s operations, policies or practices.

Appointmentof New Chief Financial Officer

On

July 23, 2024, the Company’s Board appointed Tiago Moreira de Miranda, age 40, as the Company’s new Chief Financial Officer, Principal Accounting Officer, and Treasurer, effective immediately. From February 2024 until July 2024, Mr. Miranda was the Chief Financial Officer of Apollo Resources. In consideration for his services as an officer of the Company, Mr. Miranda will: (i) receive cash compensation of US$15,000

per

month; (ii) have the opportunity, based on achieving certain specific performance metrics, to earn additional annual compensation of up to US$45,000

and

up to US$15,000

as

a discretionary bonus based; (iv) receive 40,000 time-based restricted stock units (“RSUs”) to be granted pursuant to the Company’s 2023 Stock Incentive Plan, which shares will vest annually in four equal installments, with vesting period starting the first month after his employment start date. Additionally, if during the first 12 months of his employment, calculated from his employment start date, Mr. Miranda’s employment is terminated by the Company for any reason, 25% of his RSUs will vest immediately upon termination. Mr. Miranda will receive separate compensation for supervising the internal accounting and other financial-related functions for Apollo Resources and Jupiter Gold.

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Item2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

The following discussion of our financial condition and results of operations should be read in conjunction with our unaudited consolidated financial statements and the notes to those financial statements included in Item 1 of this Quarterly Report on Form 10-Q (this “Quarterly Report”) and our consolidated financial statements and notes thereto and related Management’s Discussion and Analysis of Financial Condition and Results of Operations included in our Annual Report on Form 10-K for the year ended December 31, 2023

This Quarterly Report includes forward-looking statements that are subject to risks, uncertainties and other factors described in the section entitled “Risk Factors” in Item 1.A. of Part II of this Report that could cause actual results could differ materially from those anticipated in these forward-looking statements. Additionally, our historical results are not necessarily indicative of the results that may be expected for any period in the future.

Overview

Atlas Lithium Corporation (“Atlas Lithium”, the “Company”, “we”, “us”, or “our” refer to Atlas Lithium Corporation and its consolidated subsidiaries) is a mineral exploration and development company with a developing lithium project and multiple lithium exploration properties. In addition, we own exploration properties in other battery minerals, including nickel, copper, rare earths, graphite, and titanium. Our current focus is the development from exploration to future active mining of our hard-rock lithium project located in the state of Minas Gerais in Brazil at a well-known pegmatitic district in Brazil, which has been denominated by the government of Minas Gerais as “Lithium Valley.” We intend to mine and then process our lithium-containing ore to produce lithium concentrate (also known as spodumene concentrate), a key ingredient for the battery supply chain.

We are building a modular plant targeted at producing up to 150,000 tons of lithium concentrate per annum (“tpa”) in what we describe as Phase I. We plan on adding additional modules to the plant with the intent of doubling its production capacity to up to 300,000 tpa in Phase II. However, there can be no assurance that we will have the necessary capital resources to develop such facility or, if developed, that we will reach the production capacity necessary to commercialize our products and with the quality needed to meet market demand.

All our mineral projects and properties are located in Brazil, a well-established mining jurisdiction. Our lithium properties include approximately 53,942 hectares (539 km^2^) divided in 95 mineral rights (2 in pre-mining concession stage, 85 in exploration stage, and 8 in pre-exploration stage).

In addition, we also have a few additional lithium mineral rights that are in the process of being acquired and not yet titled in our name.

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We are primarily focused on advancing and developing our hard-rock lithium project located in the state of Minas Gerais, Brazil. Our Minas Gerais Lithium Project (“MGLP”) consists of 85 mineral rights spread over approximately 468 km^2^and predominantly located within the Brazilian Eastern Pegmatitic Province which has been surveyed by the Brazilian Geological Survey and is known for the presence of hard rock formations known as pegmatites which contain lithium-bearing minerals such as spodumene and petalite. Our primary area of focus is the Neves Project, which is part of MGLP. The Neves Project has been drilled extensively and presents spodumene-bearing deposits amenable to open pit mining, with generation of ore material that can be processed by dense media separation technique to yield lithium concentrate, a commercial product within the battery supply chain.

We own approximately 47.58% of the shares of common stock of Apollo Resources, a private company primarily focused on the development of its initial iron mine.

We also own approximately 22.30% of the shares of common stock of Jupiter Gold, a company with an operating quartzite quarry and gold projects in exploration phase, the common stock of which is quoted on the OTCQB marketplace under the symbol “JUPGF.”

The results of operations from both Apollo Resources and Jupiter Gold are consolidated in our financial statements under U.S. GAAP.

OperationalUpdate

During the second quarter of 2024, Atlas Lithium achieved important milestones across several key operational areas including:

Ø Geotechnical<br> drilling program in the Neves Project advanced to approximately 80% completion as of June 30, 2024, with full completion expected by<br> end of August 2024. This program provides crucial data for mine planning and design.
Ø Metallurgical<br> studies for both Anitta 2 and Anitta 3 deposits within the Neves Project were successfully completed.
Ø The core<br> components of the modular dense media separation (DMS) lithium processing plant underwent trial assembly and are in the process of being packaged for<br> shipment. Atlas Lithium has designed its processing plant as a series of compact, preassembled modules, an approach that appears to have<br> never before been used for lithium processing in Brazil. This modular configuration reduces the plant’s physical footprint<br> compared to traditional designs. It will also enable more efficient transportation, installation, and commissioning.
Ø SAP<br> enterprise software was successfully installed.<br><br> <br><br><br> <br>In<br> June 2024, Apollo Resources received from the state regulatory authority a 10-year license<br> to mine its iron ore property in the Iron Quadrangle region of Minas Gerais, Brazil.<br><br> <br><br><br> <br>In<br> July 2024, a U.S. company ordered polished quartzite slabs from Jupiter Gold’s quartzite production. Such slabs are expected<br> to be shipped in August 2024, marking the first sale of polished quartzite slabs from Jupiter Gold as an exporter. 
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Resultsof Operations

TheSix Months Ended June 30, 2024, compared to the Six Months ended June 30, 2023

Net loss for the six months ended June 30, 2024, totaled $23,137,504, compared to net loss of $13,862,249 during the six months ended June 30, 2023. The increase is mainly due to:

● After a trial mining period in the second half of 2023,<br> Jupiter Gold started its continuing operations at its quartzite quarry in 2024. The gross margin of $180,256 was generated from the<br> sales of 269 m^3^ of unprocessed blocks of quartzite from its own production. Considering the start of operations in 2024, there was no gross<br> margin generation in the six months ended June 30, 2023.
● Higher<br> general and administrative expenses of approximately $3.4 million in the period primarily due to increased costs of labor and consultants<br> related to technical services, increased legal fees relating to transactions consummated during the quarter and other third-party<br> costs;
● An<br> increase of approximately $7.8 million in stock-based compensation expense compared to the prior period, reflecting bonus for the<br> members of the management team eligible for stock-based compensation; and
● Higher<br> finance costs of approximately $0.7 million for the period mainly due to interest expenses related to convertible notes issued in November 2023.
●

Liquidityand Capital Resources

As of June 30, 2024, we had cash and cash equivalents of $32,267,730 and working capital of $27,067,961.

Net cash used by operating activities totaled $11,292,221 for the six months ended June 30, 2024, compared to net cash provided of $11,033,491 during the six months ended June 30, 2023, representing a variation in the cash flow from operating activities of $22,325,715. The variation in net cash used /provided by operating activities was mainly due to:

● In the six months ended June 30, 2023, the Company received $20,000,000 arising from the one-time royalty sale with<br>no matchable transaction in 2024 as explained in Note 3.
● Increase<br> of approximately $3,500,000 in general and administrative expenses due to the increase in the Company’s structure as it moves towards operations. As a result of that the Company had more<br>expenditures with employees’ compensation and costs with third parties service providers such as technical consultants; 
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Net cash used in investing activities totaled $16,777,111 for the six months ended June 30, 2024, compared to net cash used of $1,929,812 during the six months ended June 30, 2023, representing an increase in cash used of $14,847,299 or 769%. The increase reflects the payments made in connection with the acquisition of the components of our lithium processing plant and capitalized exploration costs.

Net cash provided by financing activities totaled $30,140,298 for the six months ended June 30, 2024, compared to $10,675,118 during the six months ended June 30, 2023, representing an increase in cash provided of $19,465,180 or 182%. The increase is mainly due to the following financing activities that occurred during the six months ended June 30, 2023:

● The<br> sale of an aggregate of 1,871,250 shares of our common stock to Mitsui in a private placement (the “Private Placement”). The gross proceeds from the Private Placement were $30.0 million.

For further information on the transaction mentioned above, please refer to note 7 – related parties transactions.

We have historically incurred net operating losses and have not yet generated material revenues from the sale of products or services. As a result, our primary sources of liquidity have been derived through proceeds from the (i) sales of our equity and the equity of one of our subsidiaries, and (ii) issuance of convertible debt. As of June 30, 2024, we had cash and cash equivalents of $32,267,730 and working capital of $27,067,091, compared to cash and cash equivalents $29,549,927 and a working capital of $23,809,637 as of December 31, 2023. We believe our cash and cash and equivalents will be sufficient to meet our working capital and capital expenditure requirements for a period of at least twelve months from the date of these financial statements. However, our future short- and long-term capital requirements will depend on several factors, including but not limited to, the rate of our growth, our ability to identify areas for mineral exploration and the economic potential of such areas, the exploration and other drilling campaigns needed to verify and expand our mineral resources, the successful installation of our lithium processing facilities, and the ability to attract talent to manage our different areas of endeavor. To the extent that our current resources are insufficient to satisfy our cash requirements, we may need to seek additional equity or debt financing. If the needed financing is not available, or if the terms of financing are less desirable than we expect, we may be forced to scale back our existing operations and growth plans, which could have an adverse impact on our business and financial prospects and could raise substantial doubt about our ability to continue as a going concern.

CurrencyRisk

We operate primarily in Brazil, which exposes us to currency risks. Our business activities may generate intercompany receivables or payables that are in a currency other than the functional currency of the entity. Changes in exchange rates from the time the activity occurs to the time payments are made may result in it receiving either more or less in local currency than the local currency equivalent at the time of the original activity.

Our consolidated financial statements are denominated in U.S. dollars. Accordingly, changes in exchange rates between the applicable foreign currency and the U.S. dollar affect the translation of each foreign subsidiary’s financial results into U.S. dollars for purposes of reporting in the consolidated financial statements. Our foreign subsidiaries translate their financial results from the local currency into U.S. dollars in the following manner: (a) income statement accounts are translated at average exchange rates for the period; (b) balance sheet asset and liability accounts are translated at end of period exchange rates; and (c) equity accounts are translated at historical exchange rates. Translation in this manner affects the shareholders’ equity account referred to as the foreign currency translation adjustment account. This account exists only in the foreign subsidiaries’ U.S. dollar balance sheets and is necessary to keep the foreign subsidiaries’ balance sheets in agreement.

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CriticalAccounting Policies and Estimates

The discussion and analysis of our financial condition and results of operations are based upon our financial statements, which have been prepared in accordance with the accounting principles generally accepted in the United States of American (“U.S. GAAP”). Preparing financial statements requires management to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenue, and expenses. These estimates and assumptions are affected by management’s application of accounting policies. We believe that understanding the basis and nature of the estimates and assumptions involved with the following aspects of our financial statements is critical to an understanding of our financial statements.

Item3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

The information to be reported under this Item is not required of smaller reporting companies.

Item4. CONTROLS AND PROCEDURES

Evaluationof Disclosure Controls and Procedures

Our management, with the participation of our Principal Executive Officer and Principal Financial Officer, has evaluated the design, operation, and effectiveness of our disclosure controls and procedures, as defined in Rules 13a-15(e) and 15d-15(e) of the Exchange Act as of June 30, 2024. In designing and evaluating our disclosure controls and procedures, management recognizes that any controls and procedures, no matter how well designed and operated, can provide only reasonable assurance that the information required to be disclosed in reports filed or submitted pursuant to the Exchange Act is recorded, processed, summarized, and reported within the time periods specified in the rules and forms of the Commission, and that such information is accumulated and communicated to management, including its Principal Executive Officer and Principal Financial Officer as appropriate, to allow timely decisions regarding required disclosure. In addition, the design of disclosure controls and procedures must reflect the fact that there are resource constraints, and that management is required to apply judgment in evaluating the benefits of possible controls and procedures relative to their costs. On the basis of that evaluation, our Principal Executive Officer and Principal Financial Officer concluded that as a result of the material weakness in internal controls over financial reporting, described in our Amendment No. 1 to our Annual Report on Form 10-K for the fiscal year ended December 31, 2024, filed on Form 10-K/A with the SEC on November 8, 2024 (the “Form 10-K/A”), our disclosure controls and procedures were not effective as of June 30, 2024.

Changesin Internal Control over Financial Reporting

There were no changes in our internal control over financial reporting that occurred in the quarter ended June 30, 2024, that materially affected, or would be reasonably likely to materially affect, our internal control over financial reporting.

Limitationsof the Effectiveness of Controls and Procedures

In designing and evaluating the disclosure controls and procedures and internal control over financial reporting, management recognizes that any controls and procedures, no matter how well designed and operated, can provide only reasonable assurance that the information required to be disclosed in reports filed or submitted pursuant to the Exchange Act is recorded, processed, summarized, and reported within the time periods specified in the rules and forms of the SEC, and that such information is accumulated and communicated to management, including its Principal Executive Officer and Principal Financial Officer as appropriate, to allow timely decisions regarding required disclosure. In addition, the design of disclosure controls and procedures and internal control over financial reporting must reflect the fact that there are resource constrains and that management is required to apply judgement in evaluating the benefits of possible controls and procedures relative to their costs.

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PART

II OTHER INFORMATION

Item1. LEGAL PROCEEDINGS

None material.

Item1A. RISK FACTORS

Investingin our common stock involves a high degree of risk. You should carefully consider the information in this Quarterly Report,including our financial statements and the related notes thereto and “Management’s Discussion and Analysis of FinancialCondition and Results of Operations,” as well as any additional risk factors that may be described in our other filings withthe SEC from time to time, including our Annual Report on Form 10-K for fiscal year ended December 31, 2023, and our quarterlyreport on Form 10-Q for the period ended March 31, 2024, before deciding whether to invest in our securities. The occurrence of anyof the risks, the events or developments described below could harm our business, financial condition, operating results, and growthprospects. In such an event, the market price of our common stock could decline, and you may lose all or part of your investment.Additional risks and uncertainties not presently known to us or that we currently deem immaterial also may impair our businessoperations. You should consider carefully the risks and uncertainties included in this Quarterly Report and elsewhere in ourAnnual Report and other SEC filings before you decide to invest in our common stock.

Item2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS

On April 4, 2024, the Company issued 1,871,250 shares of the Company’s common stock in a private placement to Mitsui for total gross proceeds of $30,000,000 pursuant to a March 28, 2024 subscription agreement.

Item3. DEFAULTS UPON SENIOR SECURITIES

None

Item4. MINE SAFETY DISCLOSURES

None

Item5. OTHER INFORMATION

On May 23, 2024, Marc Fogassa, the Company’s Chief Executive Officer and Chairman, entered into a written plan with Goldman Sachs & Co. LLC for the potential future sale of up to 300,000 shares our common stock that is intended to satisfy the conditions of Rule 10b5-1(c) under the Exchange Act; such plan expires on March 14, 2025.

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Item6. EXHIBITS

(a) Exhibits

Exhibit<br><br> <br>Number Description
10.1 Executive Employment Agreement between the Atlas Lithium Corporation and Tiago Miranda. Incorporated by reference 10.1 to the Company’s Quarterly Report on Form 10-Q filed with the SEC on August 9, 2024.
10.2 Amended And Restated Technical Services Agreement. Incorporated by reference to 10.2 to the Company’s Quarterly Report on Form 10-Q filed with the SEC on August 9, 2024.
31.1* Certification of Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
31.2* Certification of Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
32.1** Certification of Chief Executive Officer and Chief Financial Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
101.INS* Inline<br> XBRL Instance Document
101.SCH* Inline<br> XBRL Taxonomy Extension Schema Document
101.CAL* Inline<br> XBRL Taxonomy Extension Calculation Linkbase Document
101.DEF* Inline<br> XBRL Taxonomy Extension Definition Linkbase Document
101.LAB* Inline<br> XBRL Taxonomy Extension Label Linkbase Document
101.PRE* Inline<br> XBRL Taxonomy Extension Presentation Linkbase Document
104* Cover<br> Page Interactive Data File (embedded within the Inline XBRL document)

* Filed herewith.

** Furnished herewith.

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SIGNATURES

Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

Atlas

Lithium Corporation

Signature Title Date
/s/ Marc Fogassa Chief<br> Executive Officer (Principal Executive Officer) and November 8, 2024
Marc<br> Fogassa Chairman<br> of the Board
/s/ Tiago Miranda Chief<br> Financial Officer (Principal Financial and November 8, 2024
Tiago<br> Miranda Accounting<br> Officer) 
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Exhibit31.1

CERTIFICATION

I,Marc Fogassa, certify that:

(1) I<br> have reviewed this Quarterly Report on Form 10-Q/A for the quarter ended June 30, 2024 of Atlas Lithium Corporation;
(2) Based<br> on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary<br> to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to<br> the period covered by this report;
(3) Based<br> on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material<br> respects the financial condition, results of operations and cash flows of the Company as of, and for, the periods presented in this<br> report;
(4) The<br> Company’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures<br> (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange<br> Act Rules 13a-15(f) and 15d-15(f)) for the Company and have:
(a) Designed<br> such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision,<br> to ensure that material information relating to the Company, including its consolidated subsidiaries, is made known to us by others<br> within those entities, particularly during the period in which this report is being prepared;
--- ---
(b) Designed<br> such internal control over financial reporting, or caused such internal control over financial reporting to be designed under their<br> supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements<br> for external purposes in accordance with generally accepted accounting principles;
(c) Evaluated<br> the effectiveness of the Company’s disclosure controls and procedures and presented in this report our conclusions about the<br> effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation;<br> and
(d) Disclosed<br> in this report any change in the Company’s internal control over financial reporting that occurred during the Company’s<br> most recent fiscal quarter (the Company’s fourth fiscal quarter in the case of an annual report) that has materially affected,<br> or is reasonably likely to materially affect, the Company’s internal control over financial reporting; and
(5) The<br> Company’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial<br> reporting, to the Company’s auditors and the audit committee of the Company’s Board of Directors (or persons performing<br> the equivalent functions):
--- ---
(a) All<br> significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are<br> reasonably likely to adversely affect the Company’s ability to record, process, summarize and report financial information;<br> and
--- ---
(b) Any<br> fraud, whether or not material, that involves management or other employees who have a significant role in the Company’s internal<br> control over financial reporting.
Date: November 8, 2024 /s/ Marc Fogassa
--- ---
Marc<br> Fogassa
Chief<br> Executive Officer
(Principal<br> Executive Officer)

Exhibit31.2

CERTIFICATION

I, Tiago Miranda, certify that:

(1) I have reviewed this Quarterly Report on Form 10-Q/A for the quarter ended June 30, 2024 of Atlas Lithium Corporation;
(2) Based<br> on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary<br> to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to<br> the period covered by this report;
(3) Based<br> on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material<br> respects the financial condition, results of operations and cash flows of the Company as of, and for, the periods presented in this<br> report;
(4) The<br> Company’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures<br> (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange<br> Act Rules 13a-15(f) and 15d-15(f)) for the Company and have:
(a) Designed<br> such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision,<br> to ensure that material information relating to the Company, including its consolidated subsidiaries, is made known to us by others<br> within those entities, particularly during the period in which this report is being prepared;
--- ---
(b) Designed<br> such internal control over financial reporting, or caused such internal control over financial reporting to be designed under their<br> supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements<br> for external purposes in accordance with generally accepted accounting principles;
(c) Evaluated<br> the effectiveness of the Company’s disclosure controls and procedures and presented in this report our conclusions about the<br> effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation;<br> and
(d) Disclosed<br> in this report any change in the Company’s internal control over financial reporting that occurred during the Company’s<br> most recent fiscal quarter (the Company’s fourth fiscal quarter in the case of an annual report) that has materially affected,<br> or is reasonably likely to materially affect, the Company’s internal control over financial reporting; and
(5) The<br> Company’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial<br> reporting, to the Company’s auditors and the audit committee of the Company’s Board of Directors (or persons performing<br> the equivalent functions):
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(a) All<br> significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are<br> reasonably likely to adversely affect the Company’s ability to record, process, summarize and report financial information;<br> and
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(b) Any<br> fraud, whether or not material, that involves management or other employees who have a significant role in the Company’s internal<br> control over financial reporting.
Date:<br>November 8, 2024 /s/ Tiago Miranda
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Tiago Miranda
Chief<br> Financial Officer
(Principal<br> Financial and Accounting Officer)

Exhibit32.1

Certificationof Chief Executive Officer and Principal Financial Officer

Pursuantto 18 U.S.C. Section 1350,

asadopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

Pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, the undersigned principal executive officer and principal financial officer of Atlas Lithium Corporation (the “Company”), certify that the Quarterly Report on Form 10-Q/A of the Company for the quarter ended June 30, 2024 fully complies with the requirements of Section 13(a) or Section 15(d) of the Securities Exchange Act of 1934, as amended, and the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

Date:<br> November 8, 2024 By: /s/ Marc Fogassa
Marc<br> Fogassa
Chief<br> Executive Officer
(Principal<br> Executive Officer)
Date:<br> November 8, 2024 By: /s/ Tiago Miranda
--- --- ---
Tiago<br> Miranda
Chief<br> Financial Officer
(Principal<br> Financial and Accounting Officer)

A signed original of this written statement required by Section 906 has been provided to the Company and will be retained by the Company and furnished to the Securities and Exchange Commission or its staff upon request.

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