AMERICAN BATTERY MATERIALS, INC. 10-K

Item 8. Financial Statements and Supplementary Data. Index to Consolidated Financial Statements AMERICAN BATTERY MATERIALS, INC. December 31, 2023 and 2022 Page Report of Independent Registered Public Accounting Firm (PCAOB ID XXXX) F-2 Consolidated Balance Sheets as of December 31, 2023 and 2022 F-3 Consolidated Statements of Operations for the years ended December 31, 2023 and 2022 F-4 Consolidated Statements of Changes in Stockholders’ Deficit for the years ended December 31, 2023 and 2022 F-5 Consolidated Statements of Cash Flows for the years ended December 31, 2023 and 2022 F-6 Notes to Consolidated Financial Statements for the years ended December 31, 2023 and 2022 F-7 F- 1 Report of Independent Registered Public Accounting Firm To the Board of Directors and Shareholders of American Battery Materials, Inc. Opinion on the Financial Statements We have audited the accompanying consolidated balance sheet of American Battery Materials, Inc. (the Company) as of December 31, 2023, and the related consolidated statement of operations, stockholders’ deficit, and cash flows for the year then ended and the related notes (collectively referred to as the financial statements). In our opinion, the financial statements present fairly, in all material respects, the financial position of the Company as of December 31, 2023, and the results of its operations and its cash flows for the year then ended, in conformity with accounting principles generally accepted in the United States of America. The financial statements of the Company as of December 31, 2022, were audited by other auditors whose report dated April 20, 2023, expressed an unqualified opinion on those statements. Going Concern Considerations The accompanying financial statements have been prepared assuming that the Company will continue as a going concern. The Company has suffered recurring losses since inception and has not achieved profitable operations, which raise substantial doubt about its ability to continue as a going concern. Management’s plans in regard to these matters are described in Note 2. The financial statements do not include any adjustments that might result from the outcome of this uncertainty. Basis for Opinion These financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on the Company’s financial statements based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (PCAOB) and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB. We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud. The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. As part of our audits, we are required to obtain an understanding of internal control over financial reporting, but not for the purpose of expressing an opinion on the effectiveness of the Company’s internal control over financial reporting. Accordingly, we express no such opinion. Our audits included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that our audits provide a reasonable basis for our opinion. Critical Audit Matter Critical audit matters are matters arising from the current period audit of the financial statements that were communicated or required to be communicated to the audit committee and that (1) relate to accounts or disclosures that are material to the financial statements and (2) involved our especially challenging, subjective, or complex judgments. We determined that there were no critical audit matters. April 1, 2024 We have served as the Company’s auditor since 2023. Los Angeles, California PCAOB ID Number 6580 F- 2 AMERICAN BATTERY MATERIALS, INC. Consolidated Balance Sheets December 31, December 31, 2023 2022 Assets Current assets Cash $ 7,376 $ 42,582 Prepaid expenses and other assets 143,202 62,717 Total current assets 150,578 105,299 Noncurrent assets Mineral claims 206,000 100,000 Total assets $ 356,578 $ 205,299 Liabilities and Stockholders’ Deficit Current Liabilities: Accounts payable $ 164,948 $ 438,667 Accrued expenses 449,196 482,881 Accrued interest 251,570 190,901 Promissory notes payable, net of discount 300,000 357,008 Promissory notes payable – related party 175,000 - Convertible notes payable, net of discount 1,971,503 - Convertible notes payable – related party 25,000 - Current capital lease obligation 36,254 36,254 Total current liabilities 3,373,471 1,505,711 Total Liabilities 3,373,471 1,505,711 Stockholders’ deficit Preferred stock, $ 0.0001 par value, 10,000,000 shares authorized, 0 and 50,000 shares issued and outstanding, respectively 0 5 Common stock, $ 0.001 par value, 4,500,000,000 shares authorized, 11,373,793 and 10,818,522 shares issued and outstanding, respectively 11,373 10,819 Additional paid in capital 17,211,373 16,543,601 Accumulated deficit ( 20,239,639 ) ( 17,854,837 ) Total stockholders’ deficit ( 3,016,893 ) ( 1,300,412 ) Total liabilities and stockholders’ deficit $ 356,578 $ 205,299 The accompanying notes are an integral part of the consolidated financial statements. F- 3 AMERICAN BATTERY MATERIALS, INC. Consolidated Statements of Operations Year Ended December 31, Year Ended December 31, 2023 2022 Operating Expenses General and administrative $ 2,453,700 $ 1,135,088 Total operating expenses 2,453,700 1,135,088 Operating loss ( 2,453,700 ) ( 1,135,088 ) Other Expenses / Income Gain on change in fair value of derivative liabilities - 211,345 Gain on settlement of liabilities 441,041 32,019 Fair value of stock issued for note modification ( 168,856 ) - Interest expense ( 203,287 ) ( 595,124 ) Total other income (expenses) 68,898 ( 351,760 ) Loss from operations before income taxes ( 2,384,802 ) ( 1,486,848 ) Provision for income taxes - - Net Loss $ ( 2,384,802 ) $ ( 1,486,848 ) Net loss per share – basic and diluted $ ( 0.21 ) $ ( 1.33 ) Weighted average common shares – basic and diluted 11,158,353 1,119,263 The accompanying notes are an integral part of the consolidated financial statements. F- 4 AMERICAN BATTERY MATERIALS, INC. Consolidated Statements of Changes in Stockholders’ Deficit Years Ended December 31, 2023 and 2022 Preferred stock Common stock Additional Paid in Accumulated Total Stockholders’ Shares Amount Shares Amount Capital Deficit Equity/(Deficit) Balance as of December 31, 2021 - - 1,119,263 1,120 7,324,198 ( 16,367,989 ) ( 9,042,671 ) Preferred stock issued for cash 50,000 5 - - 49,995 - 50,000 Shares issued for note conversion - - 9,560,224 9,560 8,977,467 - 8,987,027 Shares issued for warrant exercise - - 114,035 114 129,886 - 130,000 Shares issued for services - - 25,000 25 50,975 - 51,000 Fair value of warrants - - - - 11,080 - 11,080 Net loss - - - - - ( 1,486,848 ) ( 1,486,848 ) Balance as of December 31, 2022 50,000 5 10,818,522 10,819 16,543,601 ( 17,854,837 ) ( 1,300,412 ) Shares issued for services - - 170,509 171 202,831 - 203,002 Shares issued for warrant exercise - - 196,491 196 223,804 - 224,000 Shares issued for cashless warrant exercise - - 55,998 56 ( 56 ) - - Conversion of preferred stock to common stock ( 50,000 ) ( 5 ) 33,333 33 ( 28 ) - - Shares issued for note modification - - 55,451 55 168,801 - 168,856 Shares issued with notes - - 43,489 43 72,420 - 72,463 Net loss - - - - - ( 2,384,802 ) ( 2,384,802 ) Balance as of December 31, 2023 - - 11,373,793 11,373 17,211,373 ( 20,239,639 ) ( 3,016,893 ) The accompanying notes are an integral part of the consolidated financial statements. F- 5 AMERICAN BATTERY MATERIALS, INC. Consolidated Statements of Cash Flows Year Ended Year Ended December 31, December 31, 2023 2022 Cash Flows from Operating Activities Net loss $ ( 2,384,802 ) $ ( 1,486,848 ) Adjustments to reconcile net loss to net cash used in operating activities: Stock based compensation 275,465 62,080 Gain on settlement of liabilities ( 441,041 ) ( 32,019 ) Gain on change in fair value of debt and warrant liabilities - ( 211,345 ) Fair value of stock issued for note modification 168,856 - Amortization of debt discount ( 28,497 ) - Changes in operating assets and liabilities: Prepaid expenses and other assets ( 80,485 ) ( 60,954 ) Accounts payable and accrued expenses 165,781 373,099 Accrued interest 46,517 445,278 Net cash used in operating activities ( 2,278,206 ) ( 910,709 ) Cash Flows from Investing Activities: Acquisition of mineral claims ( 106,000 ) - Net cash used in investing activities ( 106,000 ) - Cash Flows from Financing Activities Proceeds from convertible notes 2,025,000 590,000 Proceeds from promissory notes 100,000 250,000 Proceeds from issuance of preferred stock - 50,000 Proceeds from warrant exercises 224,000 130,000 Repayment of convertible note - ( 75,000 ) Net cash provided by financing activities 2,349,000 945,000 - Net (decrease) increase in cash ( 35,206 ) 34,291 Cash, beginning of period 42,582 8,291 Cash, end of period $ 7,376 $ 42,582 Supplemental disclosures: Interest paid $ - $ - Supplemental disclosures of non-cash items: Accounts payable and accrued payable exchanged for convertible note $ - $ 16,667 Convertible notes converted to common stock $ - $ 6,659,705 Accrued interest on convertible notes converted to common stock $ - $ 2,327,322 The accompanying notes are an integral part of the consolidated financial statements. F- 6 AMERICAN BATTERY MATERIALS, INC. Notes to Consolidated Financial Statements For the Years Ended December 31, 2023 and 2022 Note 1 - Nature of the Business American Battery Materials, Inc. (the “Company”) is a US based renewable energy company focused on the extraction, refinement and distribution of technical minerals in an environmentally responsible manner. The Company formerly developed, marketed and distributed various self-serve electronic kiosks and mall/airport co-branded islands throughout North America. Due to the nationwide shutdown related to the COVID-19 pandemic, the Company spent a portion of 2020 restructuring and retiring certain corporate debt and obligations, while focusing on implementing a new operational direction. Through the corporate reorganization and repositioning process, the Company found itself with the unique opportunity to expand its management team and acquire mining claims that historically reported high levels of Lithium and other tech minerals. The Company hired and affiliated itself with industry veterans that bring decades of experience, credibility and relationships. On November 5, 2021, the Company acquired the rights to 102 Federal Mining Claims located in the Lisbon Valley of Utah for $ 100,000 . The acquisition was driven by historical mineral data from seven (7) existing wells with brine aquifer access. The independent third-party Technical Report indicated that further investment and development in the claims were warranted. On April 25, 2023, the Company formed Mountain Sage Minerals LLC, a Utah limited liability company, of which it is the 100 % owner. The Company will look to expand its holdings in the Lisbon Valley area with the acquisition of additional mineral claims and joint venture opportunities through this new LLC. On May 1, 2023, FINRA completed the processing of our application for a name change, and our name was officially changed to American Battery Materials, Inc. At the same time, the Company’s trading symbol was changed to BLTH. These changes better reflect the business of the Company. On June 1, 2023, the Company entered into an Agreement and Plan of Merger (the “Merger Agreement”) with Seaport Global Acquisition II Corp., a Delaware corporation (“SGI I ”), and Lithium Merger Sub, Inc., a Delaware corporation and wholly-owned subsidiary of SGII (“Merger Sub”). SGII is a blank check company, also referred to as a special purpose acquisition company, formed for the purpose of effectuating a merger, capital stock exchange, asset acquisition, stock purchase, reorganization or other similar business combination with one or more businesses. Following material changes to the transaction proposed by SGII making the transaction untenable to us, on November 20, 2023, SGII notified us that it had elected to terminate the Merger Agreement.. On August 4, 2023, the Company filed an Amendment to the Certificate of Incorporation (the “Amendment”) in order to effect a reverse stock split in the ratio of 1-for-300 (the “Reverse Split”). The Company and its shareholders holding a majority of the issued and outstanding shares of stock of the Company entitled to vote previously approved a reverse stock split for not less than 1-for-10 and not more than 1-for-1,000, at any time prior to October 20, 2023, with the Company’s Board having the discretion to determine whether or not the Reverse Split is to be effected, and if effected, the exact ratio for the Reverse Split within the above range. On August 1, 2023, the Company’s unanimously approved the Reverse Split and authorized the filing of the Amendment. On December 8, 2023, the company effectuated the reverse split of the common stock by a ratio of one-for-300 (the “Reverse Split”). All per share amounts and number of shares in the consolidated financial statements and related notes have been retroactively restated to reflect the Reverse Split. F- 7 The Company has been moving forward with its strategy of employing advanced brine extractive technology methodologies and has been in talks with numerous extraction providers. Selective mineral extraction is clearly the most cost-effective and ESG friendly approach currently available. Technologies are being utilized that can extract the desired minerals and metals from the brine and then re-inject the brines back down into the aquafer. The prospective partners have been provided the analytical results from the technical reports, but will soon provide current results, analytical, geotech modeling, aquifer modeling, recharge, flows, and depth. Note 2 - Going Concern The accompanying consolidated financial statements have been prepared on a going concern basis. The Company had net loss of $ 2,384,802 during the year ended December 31, 2023, has accumulated losses totaling $ 20,239,639 , and has a working capital deficit of $ 3,222,893 as of December 31, 2023. These factors, among others, indicate that the Company may be unable to continue as a going concern. The consolidated financial statements do not include any adjustments that might result from the outcome of these uncertainties. Until the Company can generate significant cash from operations, its ability to continue as a going concern is dependent upon obtaining additional financing. The Company hopes to raise additional financing, potentially through the sale of debt or equity instruments, or a combination, to fund its operations for the next 12 months and allow the Company to continue the development of its business plans and satisfy its obligations on a timely basis. Should additional financing not be available, the Company will have to negotiate with its lenders to extend the repayment dates of its indebtedness. There can be no assurance that the Company will be able to successfully restructure its debt obligations in the event it fails to obtain additional financing. These conditions have raised substantial doubt as to the Company’s ability to continue as a going concern for one year from the issuance of the financial statements, which has not been alleviated. Note 3 - Summary of Significant Accounting Policies Basis of Presentation and Principles of Consolidation The accompanying consolidated financial statements have been prepared in accordance with U.S. generally accepted accounting principles (GAAP). The Company’s fiscal year end is December 31. Use of Estimates The preparation of consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect amounts reported in the financial statements and accompanying notes. Actual results could differ from those estimates and be based on events different from those assumptions. Future events and their effects cannot be predicted with certainty; estimating, therefore, requires the exercise of judgment. Thus, accounting estimates change as new events occur, as more experience is acquired, or as additional information is obtained. Property and Equipment Property and equipment are stated at cost less depreciation. Depreciation is provided using the straight-line method over the estimated useful life of the assets. Equipment has estimated useful lives between three and seven years. Expenditures for repairs and maintenance are charged to expense as incurred. F- 8 Impairment of Long-lived Assets Long-lived assets, such as property and equipment and intangible assets subject to amortization are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset group may not be recoverable. Recoverability of assets to be held and used is measured by comparing the carrying amount to the estimated future undiscounted cash flows expected to be generated by the asset group. If it is determined that an asset group is not recoverable, an impairment charge is recognized for the amount by which the carrying amount of the asset group exceeds its fair value. Mineral Rights and Properties The Company capitalizes acquisition costs until the Company determines the economic viability of the property. Since the Company does not have proven and probable reserves as defined by Securities and Exchange Commission (“SEC”) regulation S-K 1300, exploration expenditures are expensed as incurred. The Company expenses mineral lease costs and repair and maintenance costs as incurred. The Company reviews the carrying value of our properties for impairment, including mineral rights, upon the occurrence of events or changes in circumstances that indicate the related carrying amounts may not be recoverable. During the period ending December 31, 2023, the Company took action to expand on its rights to 102 federal mining claims located in the Lisbon Valley of Utah that it purchased on November 5, 2021, for $ 100,000 . The Company acquired and staked additional lithium mining claims adjacent to its Lisbon Valley Project in Utah for $ 106,000 . The new claims have been registered with the Bureau of Land Management. The Company now owns a total of 743 placer claims over 14,260 acres, comprised of (i) the 102 original claims held; and (ii) the 641 new claims. No impairment or capitalizable costs related to the mineral claims were noted during the years ended December 31, 2023, or 2022. Earnings Per Share The Company presents basic and diluted earnings per share in accordance with ASC 260, “Earnings per Share.” Basic earnings per share reflect the actual weighted average of shares issued and outstanding during the period. Diluted earnings per share are computed including the number of additional shares that would have been outstanding if dilutive potential shares had been issued. In a loss period, the calculation for basic and diluted earnings per share is considered to be the same, as the impact of potential common shares is anti-dilutive. As of December 31, 2023, and December 31, 2022, there were approximately 290,000 and 320,000 shares potentially issuable under convertible debt agreements, options, warrants and preferred stock that could dilute basic earnings per share if converted that were excluded from the years ended December 31, 2023 and 2022 because their inclusion would have been anti-dilutive due to the Company’s net losses. Derivative Financial Instruments The Company evaluates its financial instruments to determine if such instruments are derivatives or contain features that qualify as embedded derivatives. Certain warrants issued by the Company contain terms that result in the warrants being classified as derivative liabilities for accounting purposes. For derivative financial instruments that are accounted for as liabilities, the derivative instrument is initially recorded at its fair market value and then is revalued at each reporting date, with changes in fair value reported in the consolidated statement of operations. The Company does not use derivative instruments to hedge exposures to cash flow, market or foreign currency risks. F- 9 Fair Value of Financial Instruments For certain of the Company’s financial instruments, including cash and equivalents, prepaid expenses and other assets, accounts payable, accrued liabilities and short-term debt, the carrying amounts approximate their fair values due to their short maturities. ASC 820, “Fair Value Measurements and Disclosures,” requires disclosure of the fair value of financial instruments held by the Company. ASC 825, “Financial Instruments,” defines fair value, and establishes a three-level valuation hierarchy for disclosures of fair value measurement that enhances disclosure requirements for fair value measures. The three levels of valuation hierarchy are defined as follows: ● Level 1: Unadjusted quoted prices in active markets that are accessible at the measurement date for identical, unrestricted assets or liabilities. The Company considers active markets as those in which transactions for the assets or liabilities occur in sufficient frequency and volume to provide pricing information on an ongoing basis. ● Level 2: Quoted prices in markets that are not active, or inputs which are observable, either directly or indirectly, for substantially the full term of the asset or liability. This category includes those derivative instruments that the Company values using observable market data. Substantially all of these inputs are observable in the marketplace throughout the term of the derivative instruments, can be derived from observable data, or supported by observable levels at which transactions are executed in the marketplace. ● Level 3: Measured based on prices or valuation models that require inputs that are both significant to the fair value measurement and less observable from objective sources (i.e. supported by little or no market activity). Level 3 instruments include derivative warrant instruments. The Company does not have sufficient corroborating evidence to support classifying these assets and liabilities as Level 1 or Level 2. Stock-Based Compensation The Company accounts for stock-based compensation in accordance with ASC 718, “Compensation - Stock Compensation,” which requires all stock-based awards granted to employees, directors, and non-employees to be measured at grant date fair value of the equity instrument issued and recognized as expense. Stock-based compensation expense is recognized on a straight-line basis over the requisite service period of the award, which is generally equivalent to the vesting period. The fair value of each stock option granted is estimated using the Black-Scholes option pricing model. The measurement date for the non-forfeitable awards to non-employees that vest immediately is the date the award is issued. Revenue Recognition We recognize revenue under ASC 606, “Revenue from Contracts with Customers,” the core principle of which is that an entity should recognize revenue to depict the transfer of control for promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. In applying the revenue recognition principles, an entity is required to identify the contract(s) with a customer, identify the performance obligations, determine the transaction price, allocate the transaction price to the performance obligations and recognize revenue as the performance obligations are satisfied (i.e., either over time or at a point in time). ASC 606 further requires that companies disclose sufficient information to enable readers of financial statements to understand the nature, amount, timing and uncertainty of revenue and cash flows arising from contracts with customers. The Company recognized $ 0 revenue during the years ended December 31, 2023, and 2022 . F- 10 Recent Accounting Pronouncements On August 5, 2020, the FASB issued ASU 2020-06, Debt-Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging-Contracts in Entity’s Own Equity (Subtopic 815-40): Accounting for Convertible Instruments and Contracts in an Entity’s Own Equity, which simplifies the accounting for certain financial instruments with characteristics of liabilities and equity, including convertible instruments and contracts on an entity’s own equity. This ASU is effective for public business entities, excluding smaller reporting companies, for fiscal years beginning after December 15, 2021, and for all other entities for fiscal years beginning after December 15, 2023. Early adoption is permitted for all entities no earlier than for fiscal years beginning after December 15, 2020. The Company is currently evaluating the effects this ASU will have on its financial statements. The Company has examined all other recent accounting pronouncements and determined that they will not have a material impact on its financial position, results of operations, or cash flows. Note 4 - Debt Promissory Notes Payable and Promissory Note Payable – Related Party In 2014 and 2016, the Company issued two promissory notes in the total principal amount of $ 70,000 ; a $ 40,000 Note issued December 19, 2014; and a $ 30,000 Note issued on March 29, 2016. Each note had a one-year maturity date; was governed by California law; bears interest at 10 % per annum; and requires notice from the holder in order for the respective Note to be in default. The holder of each Note has failed to provide a notice of default under either Note. Further, enforceability of each Note is uncertain as California law has a 6 -year statute of limitations (commences on the maturity date) to initiate a collection action on a note. At December 31, 2023 and December 31, 2022, neither of the Notes was in default, and the balance outstanding was $ 70,000 . During the year ended December 31, 2016, the Company issued two additional unsecured promissory notes and borrowed an aggregate amount of $ 80,000 . $ 30,000 is represented by a note issued on September 23, 2016. This note had a one-year maturity date; was governed by California law; bears interest at 10 % per annum; and requires notice from the holder in order to be in default. The holder of this Note has failed to provide a notice of default. Further, enforceability of this Note is uncertain as California law has a 6-year statute of limitations (commences on the maturity date) to initiate a collection action on a note. At December 31, 2023 and December 31, 2022, this Note was not in default, and the balance outstanding was $ 30,000 . $ 50,000 is represented by a note issued on Nov 20, 2016. During the year ended December 31, 2022, total principal and accrued interest in the amount of $ 50,000 of principal and $ 27,972 of interest were converted into a $ 95,088 convertible note dated September 23, 2022. The replacement note was converted in shares of our common stock during the quarter ended December 31, 2022. As of December 31, 2023 and December 31, 2022, the original $ 50,000 note was no longer issued and outstanding. Accrued interest at December 31, 2023 and December 31, 2022 on these notes totaled $ 134,414 and $ 131,414 , respectively. During the year ended December 31, 2022, the Company entered into 5 promissory note agreements in the aggregate amount of $ 250,000 , of which $ 175,000 with the related parties. The notes have a 1-year term, bear interest of 7 % and 9 % if paid in cash. During the year ended December 31, 2023, due dates of 4 promissory notes were extended for 7 – 9 months, of which 3 notes with related parties for $ 175,000 . A total of 3,368 shares of common stock were issued to related party in connection with the agreement of the holder to extend the maturity date of a $ 100,000 note. The outstanding principal balance was $ 250,000 as of December 31, 2023. Accrued interest at December 31, 2023 and December 31, 2022 on these notes totaled $ 19,880 and $ 7,513 , respectively. During the year ended December 31, 2023, the Company entered into a short-term promissory note agreement in the amount of $ 125,000 . The note has a discount of $ 25,000 . A total of 8,500,000 shares of common stock were issued as additional consideration for the issuance of the note evidencing the loan. F- 11 During the year ended December 31, 2023, $ 7,008 in principal and $ 60,976 in interest were forgiven by noteholders. Convertible Notes Payable and Convertible Notes Payable – Related Party In February 2023, the Company entered into a convertible promissory note agreement in the amount of $ 25,000 with a related party. The note has a 1 -year term, bears interest of 9 %, and has a conversion price equal to the lesser of (1) the most recent issuance price; or (2) closing price for the common stock on the maturity date. The outstanding principal balance was $ 25,000 as of December 31, 2023. Accrued interest as of December 31, 2023, was $ 1,881 . During the year ended December 31, 2023, the Company entered into Note Purchase Agreements with seven investors not affiliated with the Company (the “Purchasers”) pursuant to which the Purchasers purchased from the Company convertible notes (the “Convertible Notes”) with an aggregate principal amount of $ 2,000,000 . A total of 67,239 shares of common stock were issued according to the note agreements or as additional consideration for the issuance of the notes. The outstanding principal and accrued interest balances on December 31, 2023 were $ 2,000,000 and $ 95,396 , respectively. The Convertible Notes provide for a maturity of 12-months; 7.5 % interest per annum; and no right to prepay during the first 6-months after the date of issuance (the “Issuance Date”). The Convertible Notes are convertible into shares of common stock of the Company (the “Conversion Shares”) as follows: (a) The Convertible Notes automatically convert into Conversion Shares upon the shares of the Company’s common stock being listed on a higher exchange due to the (i) pricing and funding of a form S-1 registration statement; or (ii) the closing of a transaction resulting in the uplist (either, a “Triggering Transaction”). The conversion price for the Conversion Shares in an automatic conversion shall be equal to: (1) 75 % of the price under the Triggering Transaction if within 120-days of the Issuance Date; (2) 70 % of the price under the Triggering Transaction if within 121 to 150-days of the Issuance Date; (3) 65 % of the price under the Triggering Transaction if more than 150-days of the Issuance Date. (b) The Purchasers have the right to convert into Conversion Shares, in whole or in part, at any time after 180 days following the Issuance Date. The conversion price for the Conversion Shares in a voluntary conversion shall be equal to 65 % of the volume weighted average price for the Company’s common stock during the 20-consecutive trading days preceding the conversion. Scheduled maturities of debt remaining as of December 31, 2023, for each respective fiscal year end are as follows: 2023 $ 0 2024 2,471,503 Total $ 2,471,503 The following table reconciles, for the years ended December 31, 2023, and 2022, the beginning and ending balances for financial instruments related to the embedded conversion features that are recognized at fair value in the consolidated financial statements. Year ended December 31, 2023 December 31, 2022 Balance of embedded derivative at the beginning of the period $ $ 211,345 Change in fair value of conversion features ( 211,345 ) Balance of embedded derivatives at the end of the period $ - $ - F- 12 Note 5 - Capital Lease Obligations During the year ended December 31, 2018, the Company entered into various capital lease agreements. The leases expire at various points through the year ended December 31, 2023. The following schedule provides minimum future rental payments required as of December 31, 2023. 2023 $ 36,692 Total minimum lease payments 36,692 Less: Amount represented interest ( 438 ) Present value of minimum lease payments and guaranteed residual value $ 36,254 Note 6 - Capital Stock The Company filed a certificate of amendment to its certificate of incorporation, which effectuated as of December 8, 2023, a reverse split of the Company’s common stock by a ratio of one-for-300 (the “Reverse Split”). All per share amounts and number of shares in the consolidated financial statements and related notes have been retroactively restated to reflect the Reverse Split. On October 20, 2022 the Company, following receipt of written approval from stockholders acting without a meeting and holding at least the minimum number of votes that would be necessary to authorize or take such action at a meeting, filed an amendment to its Certificate of Incorporation to (i) change the name of the Company to “AMERICAN BATTERY MATERIALS, INC.” (the “Name Change”); and (ii) increase the total number of authorized shares of the Company’s common stock, par value $ 0.001 per share, from 600,000,000 to 4,500,000,000 (the “Authorized Share Increase”). The Authorized Share Increase was effective as of October 20, 2022. The Name Change was processed by FINRA and was effective as of May 1, 2023, at which time the Company’s trading symbol was changed to BLTH. On October 20, 2022, in addition to the Name Change and the Authorized Share Increase, the holder of 63.86 % of the issued and outstanding shares of stock of the Company entitled to vote took action by written consent and without a meeting, pursuant to Delaware General Corporate Law Section 228, and adopted and approved the following actions: 1. Future amendment of the Company’s Certificate of Incorporation to implement a decrease in the authorized shares of the Company’s Common Stock from 4,500,000,000 to a number of not less than 10,000,000 and not more than 2,000,000,000 (the “Authorized Share Reduction”), at any time prior to October 20, 2023 (the “Anniversary Date”), with the Board having the discretion to determine whether or not the Authorized Share Reduction is to be effected, and if effected, the exact number of the Authorized Share Reduction within the above range. 2. Future amendment of the Company’s Certificate of Incorporation to implement a reverse stock split of the Company’s Common Stock by a ratio of not less than 1-for-10 and not more than 1-for-1,000 , (the “Reverse Split”), at any time prior to the Anniversary Date, with the Board having the discretion to determine whether or not the Reverse Split is to be effected, and if effected, the exact ratio for the Reverse Split within the above range. F- 13 Preferred Stock The Company has authorization for “blank check” preferred stock, which could be issued with voting, liquidation, dividend and other rights superior to common stock. As of December 31, 2023, and December 31, 2022, there were 10,000,000 shares of preferred stock authorized, and 0 and 50,000 shares issued and outstanding, respectively. On August 12, 2022, the Company effected with the Delaware Secretary of State a designation of 50,000 shares of Series A Super Voting Preferred Convertible Stock, having a par value of $ 0.001 per share and a purchase price of $ 1.00 per share (the “Series A Preferred”). The Series A Preferred may vote on any action upon which holders of the Common Stock may vote, and they shall vote together as one class with voting rights equal to sixty percent ( 60 %) of all of the issued and outstanding shares of Common Stock of the Company. The Series A Preferred shall automatically convert into shares of Common Stock upon the earlier of either a) the effectiveness of a registration statement under the Securities Act of 1933, or b) Twelve (12) months from the issuance of the Series A Preferred Stock at a ratio equal to the purchase prices per share of the Series A Preferred divided by $ 0.005 . During the year ended December 31, 2023, the Company converted 50,000 shares of its Series A Preferred stock into 33,333 shares of its common stock. Common Stock The Company has authorized 4,500,000,000 shares of common stock, with 11,373,793 and 10,818,522 shares issued and outstanding at December 31, 2023 and December 31, 2022, respectively. During the year ended December 31, 2023, the Company issued 555,271 shares of its common stock, including 170,509 shares of common stock for services valued at $ 203,002 ; 196,491 shares of common stock upon warrant exercises for an aggregate exercise price of $ 224,000 ; 55,998 shares of common stock upon cashless warrant exercise; 33,333 shares of common stock upon conversion of 50,000 shares of its Series A Preferred stock, 55,451 shares of common stock for note modification, and 43,489 shares of common stock in relation to issuance of promissory and convertible notes. During the year ended December 31, 2022, the Company issued 9,699,259 shares of its common stock, including 9,560,224 shares upon the conversion of $ 8,987,027 of convertible notes and accrued interest; 114,035 shares upon warrant exercises for an aggregate exercise price of $ 130,000 ; and 25,000 shares for services valued at $ 51,000 issued pursuant to an Investors Relations Consulting Agreement with a third party dated December 12, 2022. F- 14 Note 7 - Stock Options and Warrants Warrants As of December 31, 2023, the Company had the following warrant securities outstanding: Warrants Exercise Price Expiration 2018 Warrants – financing 3,166 $ 1.14 September 2024 2019 Warrants –financing 135,000 $ 1.67 March - October 2024 2019 Warrants for services 4,167 $ 1.14 March - April 2024 2020 Warrants for services 10,000 $ 1.14 February 2025 2022 Exchange warrants 237,232 $ 1.14 September 2025 Total 389,565 A summary of all warrant activity for the year ended December 31, 2023, is as follows: Post-split Number of Warrants Weighted Average Exercise Price Weighted Average Remaining Contractual Term Balance outstanding at December 31, 2022 422,205 $ 4.86 2.32 Granted - - - Exercised ( 15,211 ) 1.26 - Cancelled - - - Expired ( 17,429 ) 21.00 - Balance outstanding at December 31, 2023 389,565 $ 1.34 1.35 Exercisable at December 31, 2023 389,565 $ 1.34 1.35 The intrinsic value of the outstanding warrants as of December 31, 2023, was $ 0 , as the exercise prices exceeded the common stock’s fair market value per share on that date. Equity Incentive Plan On July 22, 2011, the Board of Directors of the Company approved the Company’s 2011 Equity Incentive Plan (the “Plan”) and on July 26, 2011, stockholders holding a majority of shares of the Company approved, by written consent, the Plan and the issuance under the Plan of 16,667 shares. On November 16, 2017, the Board of Directors approved an increase of 33,333 shares to be made available for issuance under the Plan. Accordingly, the total number of shares of common stock available for issuance under the Plan is 50,000 shares. Awards may be granted to employees, officers, directors, consultants, agents, advisors and independent contractors of the Company and its related companies. Such options may be designated at the time of grant as either incentive stock options or nonqualified stock options. Stock-based compensation includes expense charges related to all stock-based awards. Such awards include options, warrants and stock grants. Generally, the Company issues stock options that vest over three years and expire in 5 to 10 years. There are currently no awards issued and outstanding under the Plan. F- 15 Note 8 - Income Taxes Loss from operations before provision (benefit) for income taxes and associated tax provision (benefit) are summarized in the following table: Years ended December 31, Net Loss 2023 2022 Domestic $ ( 2,384,802 ) $ ( 1,430,872 ) Foreign - - $ ( 2,384,802 ) $ ( 1,430,872 ) Current Federal $ - $ - State Foreign - - Total Current $ $ Deferred Federal $ ( 590,371 ) $ ( 270,482 ) State ( 112,452 ) ( 51,521 ) Foreign - - Total Deferred ( 702,823 ) ( 322,003 ) Less Increase in Allowance 702,823 322,003 Net Deferred $ - $ - Total Income Tax Provision $ $ The significant components of the deferred tax assets and liabilities are summarized below: Years ended December 31, 2023 2022 Deferred Tax Assets (Liabilities): Net Operating Loss Carry-Forwards $ 4,273,846 $ 3,677,645 Depreciable and Amortizable Assets ( 20,520 ) ( 20,520 ) Stock Based Compensation 118,228 67,477 Beneficial Conversion Feature 609,101 556,265 Loss Reserve 457 457 Accrued Compensation 37,326 35,146 Other 32,364 31,509 Total 5,050,802 4,347,979 Less Valuation Allowance ( 5,050,802 ) ( 4,347,979 ) Net Deferred Tax Assets (Liabilities) $ - $ - At December 31, 2023 and 2022, the Company has available net operating loss carry-forwards for federal and state income tax purposes of approximately $ 15.2 million and $ 12.8 million, respectively. Of the federal net operating loss carryforward, $ 9.5 million, if not utilized earlier, expires through 2039 and $ 3.3 million will carry-forward indefinitely. The state net operating loss carryforwards expire through 2042, if not utilized earlier. Due to the uncertainty as to the Company’s ability to generate sufficient taxable income in the future and utilize the net operating loss carry-forwards before they expire, the Company has recorded a valuation allowance to fully offset the net operating loss carry-forwards, as well as the total net deferred tax assets. F- 16 Internal Revenue Code Section 382 (“Section 382”) imposes limitations on the availability of a company’s net operating losses and other corporate tax attributes as certain significant ownership changes occur. As a result of the historical equity instrument issuances by the Company, a Section 382 ownership change may have occurred and a study will be required to determine the date of the ownership change, if any. The amount of the Company’s net operating losses and other tax attributes incurred prior to any ownership change may be limited based on the Company’s value. A full valuation allowance has been established for the Company’s deferred tax assets, including net operating losses and any other corporate tax attributes. During the years ended December 31, 2023, and 2022, the Company had no unrecognized uncertain tax positions. The Company’s policy is to recognize interest accrued and penalties related to unrecognized uncertain tax positions in tax expense. The Company files income tax returns in the U.S. federal jurisdiction, as well as the states of California, Florida, Illinois and New York. The tax years 2019-2023 generally remain open to examination by the U.S. federal and state taxing authorities. A reconciliation of the income tax provision using the statutory U.S. income tax rate compared with the actual income tax provision reported on the consolidated statements of operations is summarized in the following table: Years ended December 31, 2023 2022 Statutory United States federal rate 21.00 % 21.00 % State income tax, net of federal benefit 4.00 4.00 Change in valuation allowance ( 29.47 ) ( 22.50 ) Stock based compensation 2.13 1.08 Permanent differences 0.04 0.11 Other 2.31 ( 3.69 ) Effective tax rate benefit (provision) - % - % Note 9 - Subsequent Events The Company has evaluated events occurring subsequent to December 31, 2023, through the date these financial statements were issued and determined the following significant events require disclosure: ● On January 1, 2024, the Company executed an exchange agreement to substitute a promissory note originally valued at $ 125,000 with a new promissory note valued at $ 175,000 . The additional principal of $ 50,000 was provided as non-cash consideration for extending the maturity date of the original note. ● On January 16, 2024, a new convertible promissory note was issued with a principal amount of $ 30,000 . ● On January 31, 2024, the company issued 833 shares of its common stock as payment for services rendered. ● On February 23, 2024, the company issued 833 shares of its common stock as payment for services rendered. ● On February 29, 2024, a new convertible promissory note was issued with a principal amount of $ 25,000 . ● On February 29, 2024, the Company executed an exchange agreement to substitute a promissory note originally valued at $ 175,000 with a new promissory note valued at $ 225,000 . The additional principal of $ 50,000 was provided as non-cash consideration for extending the maturity date of the original note. F- 17 ● On March 21, 2024, a new convertible promissory note was issued for a value of $254,713.44, including $50,000 in additional capital, cancellation of a $50,000 promissory note dated July 27, 2022, cancellation of a $25,000 promissory note dated November 8, 2022, cancellation of accrued salary amounting to $96,653.84 as of February 29, 2024, and cancellation of $30,350 due in un-reimbursed advances. ● On March 22, 2024, a new convertible promissory note was issued for a value of $138,073.94, involving the cancellation of a $25,000 promissory note dated February 28, 2022, and a $100,000 promissory note dated September 12, 2022. ● On March 22, 2024, a new convertible promissory note was issued for a value of $ 55,321.92 , including the cancellation of a $ 50,000 promissory note dated September 14, 2022, which had a balance of $ 55,321.92 . ● On March 22, 2024, a new convertible promissory note was issued for a value of $ 102,996.71 , involving the cancellation of three promissory notes: a $ 40,000 note dated December 19, 2014, a $ 30,000 note dated March 29, 2016, and a $ 30,000 note dated September 23, 2016, with a combined current balance of $ 102,996.71 . ● On March 22, 2024, a new convertible promissory note was issued for a value of $ 25,404.88 , involving the cancellation of accrued expenses amounting to $ 25,404.88 . F- 18 Item 9. Changes In and Disagreements With Accountants On Accounting and Financial Disclosure. None.