UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM10-Q
(Mark One)
For the quarterly period ended June 30, 2026
For the transition period from ____________ to ____________
Commission File Number 001-41552
ATLAS LITHIUM CORPORATION
(Exact name of registrant as specified in its charter)
Rua Antonio de Albuquerque, 156 – 17th Floor
Belo Horizonte, Minas Gerais, Brazil, 30.112-010
(Address of principal executive offices, including zip code)
(833)661-7900
(Registrant’s telephone number, including area code)
Securities registered pursuant to Section 12(b) of the Act
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.
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 10, 2026, there were outstanding 30,099,805 shares of the registrant’s common stock.
TABLE OF CONTENTS
CAUTIONARY NOTE REGARDING FORWARD LOOKING STATEMENTS
This Quarterly Report on Form 10-Q (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. 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. However, the absence of these terms does not mean that the statement is not a forward-looking statement. Forward-looking statements in this Quarterly Report include, without limitation, statements regarding: our current expectations for our future results of operations and financial position; the planned development of our processing facility and our production capabilities; the advancement and development of the Minas Gerais Lithium Project; our ability to effectively process minerals and achieve commercial grade at scale; whether the Company’s exploration targets will ultimately be developed into mineral reserves; the timing and amount of any future production; 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); our ability to realize the benefits of our transactions with Mitsui & Co., Ltd; uncertainty about our ability to obtain required capital to execute our business plan and repay our obligations as they come due; volatility in the market prices of lithium and lithium products and demand for such products; the impact of U.S. tariffs on Brazilian imports, including the imposition of reciprocal tariffs or other retaliatory trade measures; geopolitical conflicts and military actions, including the ongoing conflict between the United States and Iran and associated risks to global markets, including energy markets; the potential success or positive outlook regarding any exploratory, developmental and production activities; our ability to obtain permits or otherwise comply with legal and regulatory requirements related to our projects and activities; and our ability to find and retain technical employees and consultants. 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.
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, therefore you should not unduly rely on these statements. Factors that could cause future results to materially differ from those projected, anticipated or expected in forward-looking statements include, but are not limited to: unprofitable efforts resulting not only from the failure to discover additional mineral deposits, but also from finding mineral deposits that, though present, are insufficient in quantity and quality to return a profit from production; uncertainty that mineral resources will be converted into mineral reserves or that mineral reserves will be mined as planned; market fluctuations; government regulations, including regulations relating to royalties, allowable production, importing and exporting of minerals, including tariffs or other trade barriers, and environmental protection; competition; the loss of services of key personnel; unusual or infrequent weather phenomena, sabotage, government or other interference in the maintenance or provision of infrastructure as well as general economic conditions; and 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/A for fiscal year ended December 31, 2025 (the “2025 Annual Report”) filed with the SEC on August 14, 2026. The risk factors contained in our 2025 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.
PART I - FINANCIAL INFORMATION
Item 1 FINANCIAL STATEMENTS
CONDENSED CONSOLIDATED BALANCE SHEETS
June 30, 2026 and December 31, 2025
(UNAUDITED)
The accompanying notes are an integral part of the condensed consolidated financial statements.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS
For the Three and Six Months Ended June 30, 2026 and 2025
CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS’ EQUITY
For the Three Months Ended June 30, 2026 and 2025
For the Six Months Ended June 30, 2026 and 2025
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
169,692
87,748
51,521
NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
NOTE 1 – ORGANIZATION, BUSINESS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Organization and 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.
Basis of Presentation and Principles of Consolidation
The unaudited condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”), consistent in all material respects with those applied in our 2025 Form 10-K, and are expressed in United States dollars. The information included in this Form 10-Q should be read in conjunction with the consolidated financial statements and accompanying notes included in our 2025 Form 10-K. For the period ended June 30, 2026 the condensed consolidated financial statements include the accounts of the Company; (i) its 100% owned subsidiary Atlas Lithium Limited and its subsidiary Atlas Litio Brasil Ltda (“Atlas Brazil”); (ii) its 100% owned subsidiary Athena Mineral Resources Corporation and its subsidiary Athena Litio Ltda; (iii) its 100% owned subsidiary Brazil Mineral Resources Corporation and its subsidiary Atlas Recursos Minerais; (iv) its 20.16% equity interest in Atlas Critical Minerals Corporation (“Atlas Critical Minerals”) and its subsidiaries Mineração Apollo Ltda. (“Apollo”), Mineração Duas Barras Ltda. (“MDB”), RST Recursos Minerais Ltda. (“RST”) and Mineração Jupiter Ltda. We have concluded that Atlas Critical Minerals and its subsidiaries are variable interest entities (“VIE”) in accordance with applicable accounting standards and guidance. As such, the accounts and results of Atlas Critical Minerals and their subsidiaries have been included in our condensed consolidated financial statements.
All material intercompany accounts and transactions have been eliminated in consolidation.
Business Segment
The Company has one reportable segment: mining. The mining segment derives revenue in Brazil by mining, beneficiating and selling material mined from the Company’s several mining rights. Currently the Company generates revenue solely from two operating projects of its minority-owned, consolidated subsidiary, Atlas Critical Minerals Corporation: quartzite and iron ore. The Company’s Neves Project is in the development stage. The Company’s other mining projects are in the exploration stage.
The accounting policies of the mining segment are the same as those described in the summary of significant accounting policies.
The chief operating decision maker (“CODM”) of the mining segment is the Company’s chief executive officer. The CODM regularly reviews the revenue, significant expenses categories, including exploration and evaluation costs, and general and administrative expenses.
The significant expenses (including capitalized expenses) on which the CODM relies are those that are reported on the condensed consolidated balance sheet and statements of operations and comprehensive loss. Total segment assets as of June 30, 2026, were $89,348,437, primarily consisting of mineral rights, capitalized exploration/development costs and equipment acquisitions for the Neves Project.
All of the Company’s revenue and long-lived assets are located in Brazil. For the six months ended June 30, 2026, the Company had one customer accounting for 100% of the Company’s revenue.
Use of 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 materially from those estimates.
Foreign Currency
Until December 31, 2025, with the exception of Atlas Brazil, our subsidiaries based in Brazil used a local currency (Brazilian Reais) as the functional currency. Resulting translation gains or losses were recognized as a component of accumulated other comprehensive income. The Company determined that, as of January 1, 2026, the U.S. dollar is the currency of the primary economic environment in which the Brazilian subsidiaries operate.
Effective January 1, 2026, the Company’s Brazilian subsidiaries changed their functional currency from Brazilian Reais to U.S. Dollars due to a shift in the underlying economic facts and circumstances affecting the subsidiaries’ operations and financing activities. In particular, our subsidiary Atlas Critical Minerals listed on the Nasdaq Capital Market and commenced trading on Nasdaq on January 9, 2026. As a result of such listing and the attendant access to U.S. capital markets, the U.S. Dollar is the primary currency through which we and our Brazilian subsidiaries expect to raise any additional capital.
In accordance with Accounting Standards Notification (“ASC”) 830, the change in functional currency was accounted for prospectively from the date of change. As a result:
Recent Accounting 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, other than those described in our 2025 Form 10-K, that have been issued that might have a material impact on its financial position or results of operations.
NOTE 2 – COMPOSITION OF CERTAIN FINANCIAL STATEMENT ITEMS
Inventories
Inventories as of June 30, 2026, and December 31, 2025, are comprised of the following:
SCHEDULE OF INVENTORIES
$
Materials and supplies consist primarily of feedstock intended for use in the Company’s production processes related to lithium operations.
Quartzite inventories as of June 30, 2026 contain slabs produced through the cutting and polishing of natural quartzite. Slabs are actively sold in the market and classified as finished goods.
Property and Equipment
The following table sets forth the components of the Company’s property and equipment as of June 30, 2026 and December 31, 2025:
SCHEDULE OF PROPERTY AND EQUIPMENT
Exploration costs such 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. Whether to capitalize an exploration/development cost or incur an expense also depends on whether the drilling or development costs relate to an ore body that has been determined to be commercially mineable and whether the expenditure relates to a probable future benefit to be generated singly or in combination with other assets. The basis of the mineral interest is amortized on a units-of-production basis.
Accounts Payable and Accrued Expenses
SCHEDULE OF ACCOUNTS PAYABLE AND ACCRUED LIABILITIES
507,762
NOTE 2 – COMPOSITION OF CERTAIN FINANCIAL STATEMENT ITEMS (CONTINUED)
Leases
Finance Leases
For the reporting period ended June 30, 2026, no financial leases meeting the criteria outlined in ASC 842 have been identified.
Operating Leases
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 assets and lease liabilities are primarily related to the Company’s offices in Belo Horizonte and Araçuaí, as well as facilities for drilling core storage leased from third parties.
The lease agreements have terms between 2 two to five years, with the possibility of extending one of the leases for an additional two years and another for an additional 12 months. 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 our incremental borrowing rate. The continuity of the lease liabilities is presented in the table below:
SCHEDULE OF OPERATING LEASE LIABILITY
76,037
18,970
(169,692
349,885
234,211
The maturity of the lease liabilities (contractual undiscounted cash flows) is presented in the table below:
SCHEDULE OF MATURITY OF THE LEASE LIABILITIES
Convertible Debt
SCHEDULE OF CONVERTIBLE DEBT
On November 7, 2023, we entered into a convertible note purchase agreement (the “November 2023 Convertible Note Agreement”) with a number of investors to raise up to $20,000,000in proceeds through the issuance of convertible promissory notes with the following key terms:
On November 7, 2023, we issued $10,000,000in convertible promissory notes (the “Notes”) under the terms of the November 2023 Convertible Note Purchase Agreement, and there were no other purchases and sales of the convertible promissory notes. On the date of issuance, we received $10,000,000in cash proceeds and recorded (i) a $9,688,305convertible debt liability and (ii) a $311,695conversion feature derivative liability in our consolidated statement of financial position, as further disclosed below. In the three and six months ended June 30, 2026, the Company recorded $162,056and $322,330in interest expense and $25,902and $51,521in accretion expense in the condensed consolidated statement of operations and comprehensive loss ($162,055and $322,330, in interest expenses and $25,903and $51,522in accretion expense in the three and six months ended June 30, 2025). The Notes will become due on November 7, 2026.
Derivatives
SCHEDULE OF DERIVATIVES
a) Derivative liability – embedded conversion feature on convertible debt
On November 7, 2023, the Company issued the Notes. In accordance with Financial Accounting and Standards Board (“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.
On December 31, 2025, the fair value of the embedded conversion feature was determined to be $6,507 using a Black-Scholes collar option pricing model with the following assumptions:
SCHEDULE OF FAIR VALUE EMBEDDED CONVERSION PRICING MODEL ASSUMPTION
On June 30, 2026, the fair value of the embedded conversion feature was determined to be $143 using a Black-Scholes collar option pricing model with the following assumptions:
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, 2026, the Company recognized a $1,721 and a $6,364 gain on changes in fair value of financial instruments in the condensed consolidated statement of operations and comprehensive loss ($17,607 and $59,240 in the three and six months ended June 30, 2025).
b) Derivative liability – other stock incentives
The employment agreement of Igor Tkachenko, 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, 2026, the Company’s obligations under this employment agreement contemplate 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
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 of June 30, 2026, 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 $171, as measured using a Monte Carlo Simulation with the following ranges of assumptions: the Company’s stock price of $3.76, expected dividend yield of 0%, expected annual volatility of 99.95%, risk-free interest rate of 3.98%, and an expected term of 6months. 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.
c) Derivative asset - Non-Deliverable Forward
Our Brazilian subsidiaries are exposed to foreign-currency exchange-rate fluctuations in the normal course of business because a portion of their expenses are paid in Brazilian reais (BRL). To mitigate this exposure, these subsidiaries utilize non-deliverable forward foreign-exchange contracts (“NDFs”), which are designed to offset changes in cash flows attributable to currency exchange movements.
The Company applies hedge accounting in accordance with U.S. GAAP (ASC 815). As a result, these derivative instruments are designated and qualify as cash flow hedges, with the entire gain or loss on the derivative initially recorded in Other Comprehensive Income (OCI). These amounts remain deferred in OCI and are subsequently reclassified into earnings in the same income statement line item as the hedged item when it affects earnings.
Atlas Lithium actively monitors the derivative portfolio of its subsidiaries on a monthly basis to assess financial results and cash flow implications. These contracts are used strictly for risk management purposes, and none of our Brazilian subsidiaries engage in speculative foreign-exchange transactions. Additionally, these contracts do not contain any credit-risk-related contingent features.
As of June 30, 2026, the fair value of outstanding NDF contracts was recorded as Derivative assets on the balance sheet.
For the 6 months period ended June 30, 2026:
The following table summarizes the non-deliverable forward foreign exchange contracts that remain open as of June 30, 2026:
SCHEDULE OF NON DELIVERABLE FORWARD EXCHANGE CONTRACTS
Dates
Entered Into
Total Notional
Amounts (USD)
FX rate
(BRL/USD)
Amounts (BRL)
Settlement
Dates (Range)
NOTE 3 – DEFERRED OTHER INCOME
On May 2, 2023, the Company and Atlas Brazil 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 Atlas Brazil 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 Atlas Brazil from the sale of products from 19 mineral rights and properties that are located in Brazil and held by Atlas Brazil. Deferred income recognized will be charged to profit and loss on a units-of-sale basis in accordance with the sales of the spodumene produced in mineral rights objective of the Purchase Agreement.
On the same day, Atlas Brazil and LRC entered into a Gross Revenue Royalty Agreement (the “Royalty Agreement”) pursuant to which Atlas Brazil granted LRC the Royalty and undertook to calculate and make royalty payment 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, Atlas Brazil’s right to determine operations, and LRC’s information and audit rights.
NOTE 4 – OTHER NONCURRENT LIABILITIES
Other noncurrent liabilities are comprised of tax refinancing programs at our operating subsidiaries located in Brazil and provision for contingencies. The balance of these non-current liabilities as of June 30, 2026, and December 31, 2025, amounted to $24,729 and $27,240, respectively.
NOTE 5 – STOCKHOLDERS’ EQUITY
Authorized Stock
As of December 31, 2025 and June 30, 2026, the Company had 200,000,000 authorized shares of common stock, with a par value of $0.001per share.
On November 22, 2024, we entered into an At the Market Offering Agreement (the “ATM Agreement”) with H.C. Wainwright & Co., LLC (“Wainwright”) with respect to an at the market offering program, under which we may, from time to time in our sole discretion, issue and sell through Wainwright, acting as agent, up to $25.0 million of shares of our common stock. The issuance and sale of our common stock under the ATM Agreement were made pursuant to a prospectus supplement, dated November 22, 2024, to our registration statement on Form S-3, filed with the SEC on August 25, 2023, which was declared effective on September 18, 2023 (the “2023 Form S-3”). Sales under the ATM Agreement and the 2023 Form S-3 were completed in September 2025 upon the sale of an aggregate of $25.0 million of our common stock, representing the maximum amount permitted under the 2023 Form S-3.
On August 22, 2025, we filed a registration statement on Form S-3 with the SEC on August 22, 2025, which was declared effective on August 28, 2025 (the “2025 Form S-3”). Following the effectiveness of the 2025 Form S-3, the issuance and sale of additional shares of our common stock pursuant to the ATM Agreement have and will be made under the 2025 Form S-3, including the base prospectus and the sales agreement prospectus contained therein (as each may be supplemented or amended), for so long as the 2025 Form S-3 remains effective. The 2025 Form S-3 permits the sale of up to $75million of our common stock, preferred stock, or warrants, including an aggregate of up to $40million pursuant to the ATM Agreement.
During the three and six months ended June 30, 2026, we sold 2,042,119 and 2,185,197 shares, respectively, under the ATM Agreement and the 2025 Form S-3, for proceeds of $10.4 million and $11.3 million, respectively, net of commissions and fees.
Series A Preferred Stock
On December 18, 2012, we filed with the Nevada Secretary of State a Certificate of Designations, Preferences and Rights of Series A Convertible Preferred Stock (the “Series A Preferred 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 Preferred Stock is issued and outstanding, the holders of Series A Preferred Stock shall vote together as a single class with the holders of our common stock, with the holders of Series A Preferred Stock being entitled to 51% of the total votes on all such matters regardless of the actual number of shares of Series A Preferred 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 Preferred Stock has been held by our Chief Executive Officer and Chairman, Mr. Fogassa since December 18, 2012.
NOTE 5 – STOCKHOLDERS’ EQUITY (CONTINUED)
Six Months Ended June 30, 2025 Transactions
During the six months ended June 30, 2025, the Company issued an aggregate of 2,827,544 shares of Common Stock, as follows:
SUMMARY OF AGGREGATE COMMON STOCK SHARES ISSUED
Six Months Ended June 30, 2026 Transactions
During the six months ended June 30, 2026, the Company issued an aggregate of 3,094,116 shares of its Common Stock, as follows:
Common Stock Options
During the six months ended June 30, 2026 and 2025, the Company granted options to purchase Common Stock to officers and 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
Changes in common stock options for the six months ended June 30, 2025 and 2026 were as follows:
SCHEDULE OF COMMON STOCK OUTSTANDING
Number of
Options
Outstanding and Vested
Weighted Average
Exercise Price
Remaining
Contractual
Life (Years)
Aggregated
Intrinsic
Value
-
During the three and six months ended June 30, 2026, the Company recorded $503,846 and $985,641 in stock-based compensation expense from common stock options in the condensed consolidated statements of operations and comprehensive loss ($766,693 and $1,570,740, during the three and six months ended June 30, 2025).
Common Stock Purchase Warrants
Common stock purchase warrants are accounted for as equity in accordance with ASC 480, Accounting for Derivative Financial Instruments Indexed to, and Potentially Settled in, a Company’s Own Stock, Distinguishing Liabilities from Equity.
During the six months ended June 30, 2026, the Company did not issue common stock purchase warrants. When issued the common stock purchase warrants are valued using the Black-Scholes option pricing model with the following ranges of assumptions:
SCHEDULE OF WARRANT ASSUMPTION
Changes in common stock purchase warrants for the six months ended June 30, 2026 were as follows:
SCHEDULE OF WARRANT ACTIVITY
Number ofWarrants
Weighted
Average
WeightedAverage
ContractualLife (Years)
During the three and six months ended June 30, 2026, the Company did not record any stock-based compensation expense related to common stock purchase warrant activity in the condensed consolidated statements of operations and comprehensive loss (nil and $200,981during the three and six months ended June 30, 2025)
Restricted Stock 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, 2026 and June 30, 2025 were as follows:
SCHEDULE OF CHANGE IN RESTRICTED STOCK UNITS
During the three six months ended June 30, 2026, the Company recorded $172,186 and $419,403 in stock-based compensation expense from the Company’s RSU activity in the period ($492,565and $3,389,533during the three and six months ended June 30, 2025).
Other stock incentives measured at fair value through profit or loss
As of June 30, 2026, the Company had certain other outstanding obligations to issue shares of the Company’s common stock in the event certain market 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, 2026, the Company recognized a $171 derivative liability and would have been obligated to issue 300,310 shares of common stock pursuant to these other stock incentives had the conditions of such stock incentives been met (December 31, 2025: recognized a $15,072derivative liability relating to 265,685shares 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, 2026:
SCHEDULE OF CONTRACTUAL OBLIGATIONS
NOTE 7 – RELATED PARTY TRANSACTIONS
The related party transactions are recorded at the exchange amount transacted as agreed between us and the related party. All the related party transactions have been reviewed and approved by the board of directors.
Our related parties include:
Mitsui & Co. Ltd.
Mitsui & Co., Ltd. (“Mitsui”) is a non-controlling shareholder of the Company. In the course of preparing condensed consolidated financial statements, we eliminate the effects of various transactions conducted between Atlas Lithium and its subsidiaries and among the subsidiaries.
On March 28, 2024, the Company entered into a Securities Purchase Agreement with Mitsui, pursuant to which the Company agreed to issue and sell to Mitsui, and Mitsui agreed to purchase from the Company shares of the Company’s common stock for an aggregate subscription amount of $30 million at a per share purchase price of $16.0321. The transaction closed in connection with a registered offering under the Company’s registration statement on Form S-3 (No. 333-274223) (the “Mitsui Registered Offering”).
On March 28, 2024, in connection with the closing of the Mitsui Registered Offering, the Company entered into an Investor Rights Agreement with Mitsui (the “Investor Rights Agreement”). The Investor Rights Agreement provides Mitsui with certain rights, including without limitation anti-dilution rights to maintain its proportionate ownership percentage in future issuances of the Company’s common stock or equity-linked securities (subject to certain exceptions), visitation rights to the Company’s properties, information and access rights including quarterly management presentations and meetings with the Company’s senior management, and provisions regarding the Company’s dividend policy. The Investor Rights Agreement automatically terminates upon certain events including if Mitsui’s beneficial ownership falls below 5% of the Company’s outstanding shares or upon the occurrence of a material transaction as defined in the Investor Rights Agreement.
On March 27, 2024, in connection with the closing of the Mitsui Registered Offering, our subsidiary Atlas Brazil and Mitsui entered into an Offtake and Sales Agreement, pursuant to which Atlas Brazil agreed to sell and deliver to the Mitsui, and Mitsui 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.
During the three months ended June 30, 2026, the Company issued 196,839 shares of its common stock to Mitsui & Co., Ltd., with an aggregate value of US$1.0 million, pursuant to the terms of a Memorandum of Understanding entered into on January 5, 2026. The shares were issued upon the achievement of specified contractual milestones related to advisory services provided by Mitsui in support of the Company’s financing efforts and strategic government initiatives for the Neves Project.
Atlas Critical Minerals Corporation
In January 2026, Atlas Critical Minerals successfully completed an underwritten public offering (the “Offering”) of 1,200,000shares of its common stock at a public offering price of US$ 8.00per share. In addition, the underwriters fully exercised their over-allotment option, contributing an additional 180,000shares to the Offering total, resulting in total gross proceeds of approximately US$11.0million, before deducting underwriting discounts and offering expenses. The Company participated in the Offering with a total investment of $400,000for the acquisition of 50,000shares of Atlas Critical Minerals. Atlas Critical Minerals’ common stock commenced trading on Nasdaq on January 9, 2026, under the ticker symbol “ATCX”.
NOTE 7 – RELATED PARTY TRANSACTIONS (CONTINUED)
The proceeds are being used to advance exploration and development activities on Atlas Critical Minerals’ mineral properties in Brazil and for general working capital purposes.
In the six months period ended June 30, 2026, Atlas Critical Minerals was party to the following stock-based compensation transactions with related parties of the Company:
Pursuant to the amended and restated employment agreement between Atlas Critical Minerals and Mr. Fogassa, dated June 26, 2024 (the “Fogassa ACM Agreement”), Atlas Critical Minerals issued 147,359 shares of its common stock to Mr. Fogassa during the quarter ended March 31, 2026, including (i) 138,999 shares of common stock representing 4% of Atlas Critical Mineral’s total outstanding common stock as of January 1, 2026; and (ii) 8,360 shares of common stock representing 50% of the performance incentive, calculated as 20% of the increase in Atlas Critical Minerals’ net assets between December 31, 2024 and December 31, 2025.
On October 30, 2025, Atlas Critical Minerals entered into an employment agreement with Igor Tkachenko, our Vice President of Corporate Strategy, for Mr. Tkachenko to serve as Atlas Critical Minerals’ Vice President of Corporate Strategy, effective February 1, 2026 (the “Tkachenko ACM Agreement”). The Tkachenko ACM Agreement shall continue until March 1, 2028, subject to renewal by mutual consent. Pursuant to the Tkachenko ACM Agreement, Mr. Tkachenko received 75,067 time-based restricted stock units (“RSUs”) of Atlas Critical Minerals with value equivalent to $840,000, which will vest over 24 months, in equal installments of 25% on each 6-month anniversary of the Tkachenko ACM Agreement. Mr. Tkachenko is also entitled to receive fully vested shares of Atlas Critical Minerals’ common stock with value equivalent to $420,000 if and when Atlas Critical Minerals first achieves $300 million in market capitalization, as determined by Bloomberg L.P. The Tkachenko ACM Agreement further provides that in the event that Atlas Critical Minerals undergo a change in control and any of the RSUs or the shares of Atlas Critical Minerals’ common stock have not yet vested, Mr. Tkachenko’s right to receive such RSUs and shares will be accelerated.
In addition to the securities issued pursuant to the Fogassa ACM Agreement and the Tkachenko ACM Agreement, during the six months ended June 30, 2026, Atlas Critical Minerals issued 5,140 restricted stock units and 30,426 shares of common stock of Atlas Critical Minerals to officers and directors thereof at a weighted average price of $6.85 per share in settlement of $208,333 in salaries and fees owed to such officers and directors due to their services provided to Atlas Critical Minerals.
NOTE 8 – RISKS AND UNCERTAINTIES
Currency Risk
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.
NOTE 9 – SUBSEQUENT EVENTS
In accordance with FASB ASC 855-10 Subsequent Events, we have analyzed our operations subsequent to June 30, 2026 to the date these condensed consolidated financial statements were issued, and we have determined that there are no material subsequent events to disclose in these condensed consolidated financial statements.
Item 2. 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 condensed consolidated financial statements and the notes to those financial statements included in Item 1 of 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, 2025 as amended (the “2025 Form 10-K”).
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 is a mineral development company implementing its first mine and processing facility at its 100%-owned Neves Project, our material mineral property. In addition, Atlas Lithium owns multiple lithium exploration properties. Furthermore, through our approximately 20% ownership interest in Atlas Critical Minerals Corporation (“Atlas Critical Minerals”, Nasdaq: ATCX), a separate publicly traded company, we have exposure to other critical minerals, including rare earths, titanium, graphite, and uranium. Our current focus is the continued advancement of the Neves Project, our hard-rock lithium project in the Lithium Valley area of Minas Gerais state in Brazil, toward active mining. 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 energy storage system and electric vehicle battery supply chain.
We have disclosed mineral resources and mineral reserves for the Neves Project based on our technical report summary, effective May 15, 2025, as updated on June 16, 2026 (see Exhibit 96.1 to our 2025 Form 10-K/A).
We believe that we hold the largest portfolio of exploration properties for lithium in Brazil among publicly listed companies.
Operational Update
During the second quarter of 2026, we continued to advance our flagship Neves Project toward production while achieving several important strategic, operational, and corporate milestones. As described in further detail below, we obtained additional global recognition for the Neves Project, further strengthened our Board of Directors, contracted key execution partners, participated in leading industry conferences, and received an expansion permit for the project, as described below.
On April 2, 2026, we announced that the Neves Project had been named in the Joint Fact Sheet for Japan-U.S. Critical Minerals Project Cooperation (the “Joint Fact Sheet”), released on March 20, 2026 by Japan’s Ministry of Economy, Trade, and Industry together with the Ministry of Foreign Affairs of Japan. The Neves Project is the only Brazil-based lithium project named in the Joint Fact Sheet, which followed the U.S.-Japan Critical Minerals Investment Ministerial held on March 14, 2026 in Tokyo, as well as the summit held between Japan’s Prime Minister, Sanae Takaichi, and U.S. President, Donald Trump, on March 19, 2026.
On April 7, 2026, we announced the appointment of Admiral Flávio Augusto Viana Rocha, a former Cabinet member of the Brazilian Government, to our Board of Directors as an independent director. Admiral Rocha is a distinguished Brazilian leader with over 43 years of experience in strategy, governance, logistics, and international relations, including official government missions to more than 50 countries. From 2020 to 2022, he held the Minister-level position of Chief of the Secretariat for Strategic Affairs of the Presidency of Brazil, where he led the development of Brazil’s National Long-Term Policy and National Strategic Agenda, including the National Energy Policy.
On April 27, 2026, we announced the engagement of key operational partners for the implementation of the Neves Project, selected through a competitive process led by our technical team. Each awarded contract was finalized at or below the budget projections outlined in our Definitive Feasibility Study (the “DFS”). The selected partners included Promon Engenharia, responsible for completing multiple detailed engineering components; TSX Engineering, appointed to oversee and manage project implementation; Cerne Construções, engaged under an Engineering, Procurement, and Construction (EPC) contract for the design and construction of the project’s administrative and operational facilities; and RETC Infraestrutura, responsible for earthworks and civil construction activities. Each of these firms brings a strong track record of performance and deep experience in Brazil’s mining sector.
On May 18, 2026, we announced the engagement of Alfa Engenharia (“Alfa”) as the specialized electromechanical assembly contractor for the Neves Project. The scope of work awarded to Alfa encompasses the complete assembly of the project’s processing plant, from the crushing systems through to final product processing and dispatch, including the installation of all mechanical, electrical, instrumentation, and automation systems required for plant operations. As with our previously announced execution partners, the contract with Alfa was finalized at or below the budget projections outlined in the DFS. Our processing plant, fully-paid and 100%-owned by us, and which had previously been transported to Brazil, is ready for assembly, and Alfa’s selection provides the expertise necessary for this endeavor.
During the second quarter of 2026, members of our senior management participated in several leading industry conferences to raise the profile of the Atlas Lithium and Brazil’s emerging critical minerals sector. On June 9-10, 2026, our Chairman and Chief Executive Officer, Marc Fogassa, delivered a conference-wide address titled “The Growing Role of Brazilian Critical Minerals in Securing Global Supply” at Benchmark Giga USA 2026, held at the Ronald Reagan Building and International Trade Center in Washington, D.C. On June 17-18, 2026, Mr. Fogassa delivered the Strategic Keynote Presentation, “Lithium in Brazil: Building a Competitive Industry,” opening the 3rd Brazil Lithium & Critical Minerals Summit 2026 in Belo Horizonte, Minas Gerais, Brazil. These engagements reflect our continued efforts to strengthen relationships with industry stakeholders and to position us within global critical minerals supply chains.
On June 29, 2026, we announced that we had received the expansion permit for our Neves Project, a significant milestone in our disciplined journey toward production. Permitting is widely regarded as one of the greatest challenges in mining, and the additional permit followed comprehensive technical studies that confirmed the Neves Project’s minimal environmental impact, as well as the strong relationships we have built with our local communities in the Jequitinhonha Valley. With the expansion permit in hand, we are positioned to advance implementation of the Neves Project towards production.
Market Update
Lithium market conditions remained constructive during the second quarter of 2026. Lithium prices remained well above the lows seen in mid-2025. We believe demand continues to be supported by durable, long-term trends, including accelerating growth in the energy storage systems (“ESS”) segment — particularly for grid-scale applications and for data centers supporting the expansion of artificial intelligence — alongside continued adoption of electric vehicles worldwide. While the lithium market remains subject to price volatility and evolving supply and demand dynamics, we believe that our anticipated position among the lowest-cost lithium producers globally should provide meaningful margin protection across a range of pricing environments. Consistent with these conditions and our continued progress toward production, we have received written indications of interest from several parties seeking to secure long-term supply arrangements for our future lithium concentrate production. The level of interest may be subject to then current industry supply and demand scenario.
Results of Operations
The Three Months Ended June 30, 2026, Compared to the Three Months Ended June 30, 2025
Net loss for the three months ended June 30, 2026 totaled $11.5 million, compared to net loss of $6.3 million during the three months ended June 30, 2025. The increase is mainly due to:
The Six Months Ended June 30, 2026, Compared to the Six Months Ended June 30, 2025
Net loss for the six months ended June 30, 2026 totaled $28.0 million, compared to net loss of $16.5 million during the six months ended June 30, 2025. The increase is mainly due to:
Liquidity and Capital Resources
As of June 30, 2026, we had cash and cash equivalents of $36.1 million and working capital of $22.1 million.
Net cash used by operating activities totaled $18.2 million for the six months ended June 30, 2026, compared to net cash used of $8.3 million during the six months ended June 30, 2025, representing an increase of $9.9 million. The increase in net cash used by operating activities was mainly due to higher general and administrative expenses offset by better financial results. Please refer to section “Results of Operations” above.
Net cash used in investing activities totaled $2.0 million for the six months ended June 30, 2026, compared to net cash used of $6.3 million during the six months ended June 30, 2025, representing a decrease in cash used of $4.3 million or 68%. The decrease primarily reflects:
Net cash provided by financing activities totaled $20.4 million for the six months ended June 30, 2026, compared to $12.9 million during the six months ended June 30, 2025, representing an increase in cash provided of $7.5 million or 58%. The increase is due to the following financing activities that occurred during the six months ended June 30, 2026:
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 sales of our equity and the equity of one of our subsidiaries. We believe our 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 and reserves, the successful installation of our lithium processing facilities and availability of reserves at the estimated volume and grade, and our ability to attract talent. 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.
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 condensed consolidated financial statements are denominated in U.S. dollars.
Critical Accounting 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.
Effective January 1, 2026, the Company’s Brazilian subsidiaries changed their functional currency from Brazilian Reais to U.S. Dollars due to a shift in the underlying economic facts and circumstances affecting the subsidiaries’ operations and financing activities. In particular, our subsidiary Atlas Critical Minerals listed on the Nasdaq Capital Market and commenced trading on the Nasdaq on January 9, 2026. As a result of such listing and the attendant access to U.S. capital markets, the U.S. Dollar is the primary currency through which we and our Brazilian subsidiaries expect to raise any additional capital.
In accordance with ASC 830, the change in functional currency was accounted for prospectively from the date of change. As a result:
● assets and liabilities were translated into the new functional currency using exchange rates as of the date of change;
● nonmonetary assets and liabilities were translated at historical exchange rates (the effective date of the change is considered for the translation of existing nonmonetary assets and liabilities); and
● cumulative translation adjustments previously recorded in accumulated other comprehensive income were not reversed.
Item 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
The information to be reported under this Item is not required of smaller reporting companies.
Item 4. CONTROLS AND PROCEDURES
Evaluation of 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 the end of the period covered by this Quarterly Report on Form 10-Q. Based on that evaluation, our Principal Executive Officer and Principal Financial Officer concluded that as of June 30, 2026, our disclosure controls and procedures were effective at a reasonable assurance level.
Changes in Internal Control over Financial Reporting
There were no changes in our internal control over financial reporting that occurred in the quarter ended June 30, 2026 that materially affected, or would be reasonably likely to materially affect, our internal control over financial reporting.
Limitations of 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 constraints and that management is required to apply judgement in evaluating the benefits of possible controls and procedures relative to their costs.
PART II OTHER INFORMATION
Item 1. LEGAL PROCEEDINGS
None material.
Item 1A. RISK FACTORS
Investing in 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 Financial Condition and Results of Operations,” as well as any additional risk factors that may be described in our other filings with the SEC from time to time, including our Amended Annual Report on Form 10-K for fiscal year ended December 31, 2025, before deciding whether to invest in our securities. The occurrence of any of the risks, the events or developments described below could harm our business, financial condition, operating results, and growth prospects. 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 business operations. You should consider carefully the risks and uncertainties included in this Quarterly Report and elsewhere in our Amended Annual Report and other SEC filings before you decide to invest in our common stock.
Item 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS
We conducted the following sales of unregistered securities during the three months ended June 30, 2026, which sales were exempt from registration under the Securities Act upon reliance on Section 4(a)(2) thereof:
● On April 7, 2026 we issued 196,839 shares of our common stock to Mitsui, a related party, for consulting and professional services.
● On June 1, 2026 we issued to each of our independent directors, Amb. Roger Noriega, Ms. Cassiopeia Olson, and Mr. Stephen R. Petersen options to purchase 5,000 shares of common stock for a total aggregate of 15,000 shares, as approved in our annual shareholders’ meeting held on May 28, 2026.
Item 3. DEFAULTS UPON SENIOR SECURITIES
None.
Item 4. MINE SAFETY DISCLOSURES
Item 5. OTHER INFORMATION
On May 12, 2026, Mr. Fogassa, our Chief Executive Officer and Chairman, entered into a written plan for the potential future sale of up to 500,000 shares of our common stock that is intended to satisfy the conditions of Rule 10b5-1(c) under the Exchange Act, with such plan starting in August 2026 and expiring in December 2026.
Item 6. EXHIBITS
(a) Exhibits
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