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Item 2. Management’s Discussion and Analysis

2024-08-14 compared with 2024-05-15 · 132 added, 129 removed, 97 unchanged (73% of the section changed)

Management’s Discussion and Analysis of Financial Condition and Results of Operations

The following discussion

and analysis is intended to help you understand our results of operations and financial condition as

of March 31, 2024 and for the three months ended March 31, 2024 and 2023 .

following discussion and analysis is intended to help you understand our results of operations and financial condition as

of June 30, 2024 and for the six months ended June 30, 2024 and 2023 .

This discussion and analysis is provided as a supplement

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Risk Factors in our Annual Report on Form 10-K for the year ended December 31, 2023 .

Cautionary Statement

The following discussion

and analysis should be read in conjunction with our condensed consolidated financial statements and the notes to those financial statements

that are included elsewhere in this Quarterly Report on Form 10-Q.

Our actual results may differ materially from those anticipated in

the following discussion, as a result of a variety of risks and uncertainties, including those described under Part I, Item 1A.

in our Annual Report on Form 10-K for the year ended December 31, 2023.

following discussion and analysis should be read in conjunction with our condensed consolidated financial statements and the notes to

those financial statements that are included elsewhere in this Quarterly Report on Form 10-Q.

Our actual results may differ materially

from those anticipated in the following discussion, as a result of a variety of risks and uncertainties, including those described under

Part I, Item 1A.

Risk Factors in our Annual Report on Form 10-K for the year ended December 31, 2023.

Forward-Looking

statements contained herein constitute “forward-looking statements”.

Except for the historical information contained

herein, this Quarterly Report on Form 10-Q contains forward-looking statements (identified by the words “estimate,”

“project,” “anticipate,” “plan,” “expect,” “intend,”

“believe,” “hope,” “strategy” and similar expressions), which are based on our current

expectations and speak only as of the date made.

These forward-looking statements are subject to various risks, uncertainties and

factors that could cause actual results to differ materially from the results anticipated in the forward-looking statements,

including, without limitation, those discussed under Part I, Item 1A.

Risk Factors in our Annual Report on Form 10-K for the year

ended December 31, 2023, as filed with the Securities and Exchange Commission on April 1, 2024 and those described herein that could

cause actual results to differ materially from the results anticipated in the forward-looking statements.

Factors That May Adversely

Affect our Results of Operations

Our results of operations may be adversely affected

by various factors that could cause economic uncertainty and volatility in the financial markets, many of which are beyond our control.

Our business could be impacted by, among other things, downturns in the financial markets or in economic conditions, increases in oil

prices, inflation, increases in interest rates, supply chain disruptions, declines in consumer confidence and spending, any ongoing effects

of the Covid-19 pandemic, including resurgences and the emergence of new variants and geopolitical instability, such as the military conflict

in Ukraine and the Middle East.

We cannot at this time fully predict the likelihood of one or more of the above events, their duration

or magnitude, or the extent to which they may negatively impact our business.

The objective of our Management’s

Discussion and Analysis of Financial Condition and Results of Operations is to provide users of our financial statements with the following:

a narrative explanation from the perspective of management of our financial condition, results of operations, cash flows, liquidity and certain other factors that may affect future results;

useful context to the financial statements;

information that allows assessment of the relationship between our past performance and future performance.

This Management’s Discussion

and Analysis is a supplement to, and should be read together with, our financial statements, including notes, referenced elsewhere in

this report, and is provided to enhance your understanding of our operations and financial condition.

Due to rounding, some parts of this

discussion may not sum or calculate precisely to the totals and percentages provided in the tables.

Except for the historical information contained herein,

this Quarterly Report on Form 10-Q contains forward-looking statements (identified by the words “estimate,” “project,”

“anticipate,” “plan,” “expect,” “intend,” “believe,” “hope,”

“strategy” and similar expressions), which are based on our current expectations and speak only as of the date made.

forward-looking statements are subject to various risks, uncertainties and factors that could cause actual results to differ materially

from the results anticipated in the forward-looking statements, including, without limitation, those discussed under Part I, Item 1A.

Risk Factors in our Annual Report on Form 10-K for the year ended December 31, 2023, as filed with the Securities and Exchange Commission

on April 1, 2024 and those described herein that could cause actual results to differ materially from the results anticipated in the

forward-looking statements.

That May Adversely Affect our Results of Operations

results of operations may be adversely affected by various factors that could cause economic uncertainty and volatility in the financial

markets, many of which are beyond our control.

Our business could be impacted by, among other things, downturns in the financial markets

or in economic conditions, increases in oil prices, inflation, increases in interest rates, supply chain disruptions, declines in consumer

confidence and spending, any ongoing effects of the Covid-19 pandemic, including resurgences and the emergence of new variants and geopolitical

instability, such as the military conflict in Ukraine and the Middle East.

We cannot at this time fully predict the likelihood of one

or more of the above events, their duration or magnitude, or the extent to which they may negatively impact our business.

objective of our Management’s Discussion and Analysis of Financial Condition and Results of Operations is to provide users of our

financial statements with the following:

narrative explanation from the perspective of management of our financial condition, results of operations, cash flows, liquidity

and certain other factors that may affect future results;

context to the financial statements;

that allows assessment of the relationship between our past performance and future performance.

Management’s Discussion and Analysis is a supplement to, and should be read together with, our financial statements, including

notes, referenced elsewhere in this report, and is provided to enhance your understanding of our operations and financial condition.

Due to rounding, some parts of this discussion may not sum or calculate precisely to the totals and percentages provided in the tables.

following discussion and analysis provide information that our management believes is relevant to an assessment and understanding of

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that appear elsewhere in this Quarterly Report on Form 10-Q.

Overview and Outlook

based renewable energy company focused on the extraction, refinement and distribution of technical minerals in an environmentally

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the corporate reorganization and repositioning process, we found ourselves with the unique opportunity to acquire mining claims that

historically reported high levels of lithium and other technical minerals crucial to produce batteries used in many technology products and markets.

We hired and affiliated ourselves with industry veterans

that bring decades of experience, credibility and relationships.

November 5, 2021, we acquired the rights to 102 federal mining claims located in the Lisbon Valley of Utah for $100,000 plus the

future payment of royalties based on a percentage of the net revenue from the sale of lithium produced from a portion of the mining

historically reported high levels of lithium and other technical minerals crucial to produce batteries used in many technology products

We hired and affiliated ourselves with industry veterans that bring decades of experience, credibility and relationships.

November 5, 2021, we acquired the rights to 102 federal mining claims located in the Lisbon Valley of Utah for $100,000 plus the future

payment of royalties based on a percentage of the net revenue from the sale of lithium produced from a portion of the mining property.

The acquisition was driven by historical mineral data from seven existing wells with brine aquifer access.

We are defined

as an exploration stage issuer, under SEC Regulation S-K Item 1300.

An independent third-party technical report indicated that

further investment and development in the claims was warranted, although no determination has been made whether we have any reserves

Similarly, no determination has been made whether mineralization could be economically and legally produced or

We have no mineral reserves as defined by Regulation S-K Item 1300 and have had no mining revenue to date.

In July 2023, we acquired

and staked additional lithium mining claims adjacent to our Lisbon Valley Project in Utah.

The new claims have been registered with the

We now own a total of 743 placer claims over 14,320 acres (approximately 22 square miles), comprised of the 102 original mining claims

and 641 new claims.

On April 25, 2023, we formed

Mountain Sage Minerals, LLC, a Utah limited liability company.

We plan to expand our holdings in the Lisbon Valley area with the acquisition

of additional mineral claims and joint venture opportunities through this entity.

On June 1, 2023, we entered

into an Agreement and Plan of Merger (the “Merger Agreement”) with Seaport Global Acquisition II Corp.

and Lithium Merger Sub, Inc., a wholly owned subsidiary of SGII.

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.

As a result of the Merger Agreement, we would have become a wholly

owned subsidiary of SGII.

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.

We are defined as an exploration

stage issuer, under SEC Regulation S-K Item 1300.

An independent third-party technical report indicated that further investment and development

in the claims was warranted, although no determination has been made whether we have any reserves of minerals.

Similarly, no determination

has been made whether mineralization could be economically and legally produced or extracted.

We have no mineral reserves as defined

by Regulation S-K Item 1300 and have had no mining revenue to date.

July 2023, we acquired and staked additional lithium mining claims adjacent to our Lisbon Valley Project in Utah.

The new claims have

been registered with the BLM.

We now own a total of 743 placer claims over 14,320 acres (approximately 22 square miles), comprised of

the 102 original mining claims and 641 new claims.

April 25, 2023, we formed Mountain Sage Minerals, LLC, a Utah limited liability company.

We plan to expand our holdings in the Lisbon

Valley area with the acquisition of additional mineral claims and joint venture opportunities through this entity.

June 1, 2023, we entered into an Agreement and Plan of Merger (the “Merger Agreement”) with Seaport Global Acquisition II

(“SGII”) and Lithium Merger Sub, Inc., a wholly owned subsidiary of SGII.

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.

As a result of the Merger Agreement,

we would have become a wholly owned subsidiary of SGII.

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.

have been moving forward with our strategy of employing advanced brine extractive technology methodologies and have been in talks with

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of Operations

months ended March 31, 2024, Compared to Three months ended March 31, 2023

the three months ended March 31, 2024, and 2023, our company had no revenue.

and administrative expenses for the three months ended March 31, 2024, were $264,035, a decrease of $182,411 or 41%, compared to

$446,476 for the three months ended March 31, 2023.

The decrease in operating expenses was mainly due to a decrease in professional

In addition, we initiated construction strategies based on reports from

RESPEC Company LLC, the Company’s geotech, engineering and resource management partner, for geological modeling and drill entry

design and related planning.

months ended June 30, 2024, Compared to Three months ended June 30, 2023

the three months ended June 30, 2024, and 2023, our company had no revenue.

and administrative expenses for the three months ended June 30, 2024, were $445,791, a decrease of $648,275 or 59%, compared to $1,094,066

for the three months ended June 30, 2023.

The decrease in operating expenses was mainly due to a decrease in professional fees.

three months ended June 30, 2023 the higher operating expenses were attributable to costs incurred for staking new claims in Utah, exploration

well permitting, development of technical reports and geological modeling, and legal fees associated with the SPAC business combination

Value of Stock Issued for Note Modification

the three months ended June 30, 2024, our company recorded a fair value of stock issued for note modification of $9,000.

No such transactions

were noted during the three months ended June 30, 2023.

expense for the three months ended June 30, 2024, was $95,944, as compared to $37,063 during the three months ended June 30, 2023.

a result of the foregoing, the net loss for the three months ended June 30, 2024, was $550,735 as compared to the net loss of $1,131,129

during the three months ended June 30, 2023.

months ended June 30, 2024, Compared to Six months ended June 30, 2023

the six months ended June 30, 2024, and 2023, our company had no revenue.

and administrative expenses for the six months ended June 30, 2024, were $709,826, a decrease of $830,716 or 54%, compared to $1,540,542

for the six months ended June 30, 2023.

The decrease in operating expenses was mainly due to a decrease in professional fees.

six months ended June 30, 2023 the higher operating expenses were attributable to costs incurred for staking new claims in Utah, exploration

well permitting, development of technical reports and geological modeling, and legal fees associated with the SPAC business combination

(Loss) on Settlement of Liabilities

the three months ended March 31, 2024, our company recorded a loss on settlement of liabilities of $516,083.

During the three months

ended March 31, 2023, our company recorded a gain on settlement of liabilities of $67,984, consisting of $7,008 in principal and $60,976

in interest forgiven by creditors.

the six months ended June 30, 2024, our company recorded a loss on settlement of liabilities of $516,083.

During the six months ended

June 30, 2023, our company recorded a gain on settlement of liabilities of $67,984, consisting of $7,008 in principal and $60,976 in

interest forgiven by creditors.

Value of Stock Issued for Note Modification

the three months ended March 31, 2024, our company recorded a fair value of stock issued for note modification of $5,382.

the six months ended June 30, 2024, our company recorded a fair value of stock issued for note modification of $14,382.

No such transactions

were noted during the three months ended March 31, 2023.

expense for the three months ended March 31, 2024, was $78,383, as compared to $10,154 during the three months ended March 31, 2023.

a result of the foregoing, the net loss for the three months ended March 31, 2024, was $863,883 as compared to the net loss of $388,646

during the three months ended March 31, 2023.

were noted during the six months ended June 30, 2023.

expense for the six months ended June 30, 2024, was $174,327, as compared to $47,217 during the six months ended June 30, 2023.

a result of the foregoing, the net loss for the six months ended June 30, 2024, was $1,414,618 as compared to the net loss of $1,519,775

during the six months ended June 30, 2023.

and Capital Resources

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consolidated financial statements have been prepared on a going concern basis.

Our company had a net loss of $863,883 during the three

months ended March 31, 2024, had accumulated losses totaling $21,103,522, and a working capital deficit of $4,079,828 as of March 31,

Our company had a net loss of $1,414,618 during the six

months ended June 30, 2024, had accumulated losses totaling $21,654,257, and a working capital deficit of $4,608,868 as of June 30, 2024.

These factors, among others, indicate that our 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.

The consolidated financial statements

do not include any adjustments that might result from the outcome of these uncertainties.

we acquired our first mining claims in November 2021, we have faced an increasingly challenging liquidity situation that has limited

our ability to execute our operating plan.

Our company will need to raise additional financing in order to fund its operations for

the next 12 months and to allow us to continue the development of its business plans and satisfy its obligations on a timely

Should additional financing not be available, we will have to negotiate with its lenders to extend the repayment dates

of its indebtedness.

There can be no assurance that our company will be able to successfully restructure its debt obligations in the

event it fails to obtain additional financing.

Our company will need to raise additional financing in order to fund its operations for the

next 12 months and to allow us to continue the development of its business plans and satisfy its obligations on a timely basis.

additional financing not be available, we will have to negotiate with its lenders to extend the repayment dates of its indebtedness.

There can be no assurance that our company will be able to successfully restructure its debt obligations in the event it fails to obtain

additional financing.

of additional capital through various financing transactions or arrangements with third parties may include equity or debt financing,

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Flows from Operating Activities

the three months ended March 31, 2024, our company used $85,886 of cash in operating activities as a result of our net

loss of $863,883, offset by loss on debt settlement of $516,083 and amortization of debt discount of $20,235, fair value of stock issued

for note modification of $5,382, share-based compensation of $1,566, and net changes in operating assets and liabilities of $110,814.

the three months ended March 31, 2023, our company used $317,613 of cash in operating activities as a result of our net

loss of $388,646, increased by gain on debt settlement of $67,984 and offset by net changes in operating assets and liabilities of $139,017.

the six months ended June 30, 2024, our company used $273,154 of cash in operating activities as a result of our net loss of $1,414,618,

offset by loss on debt settlement of $516,083 and amortization of debt discount of $24,737, fair value of stock issued for note modification

of $14,382, share-based compensation of $14,261, and net changes in operating assets and liabilities of $572,001.

the six months ended June 30, 2023, the Company used $1,491,431 of cash in operating activities as a result of the Company’s net

loss of $1,519,775, increased by gain on debt settlement of $67,984 and net changes in operating assets and liabilities of $277,322,

and offset by share-based compensation of $373,650.

Flows from Investing Activities

the three months ended March 31, 2024 and 2023, our company had no investing activities.

the six months ended June 30, 2024, our company had no investing activities.

the six months ended June 30, 2023, the Company expended $106,000 for staking activities related to new federal mining claims located

in the Lisbon Valley of Utah.

Flows from Financing Activities

the three months ended March 31, 2024, financing activities provided $105,000 in proceeds from convertible notes.

the three months ended March 31, 2023, financing activities provided $1,314,000, resulting from $1,125,000 in proceeds from convertible

the six months ended June 30, 2024, financing activities provided $284,182 resulting from $105,000 in proceeds from convertible notes

and $179,182 in proceeds from promissory notes.

the six months ended June 30, 2023, financing activities provided $1,764,000, resulting from $1,575,000 in proceeds from convertible

notes, and $189,000 in proceeds from the exercise of warrants.

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regarding our outstanding promissory notes:

to a Convertible Note Amendment Agreement with each of five investors holding convertible

notes in the aggregate principal amount of $ 1,750,000

with accrued interest of $125,646, each of these investors agreed to (a) extend the maturity

date of their note to the earlier of (i) September 30, 2024 or (ii) the closing of an “uplisting”

transaction in which our common stock is traded on a national securities exchange and (b)

impose a limitation on their conversions so that the investor will not effect a conversion

under its note until the earlier of (i) the uplisting transaction closing or (ii) July 1,

to a Convertible Note Amendment Agreement with one investor holding a convertible note in

the principal amount of $50,000 with accrued interest of $3,583, the investor agreed to:

(a) extend the maturity date of its note to the earlier of (i) March 31, 2025 or (ii) the

closing of an uplisting transaction in which our common stock is traded on a national securities

exchange and (b) impose a limitation on its conversions so that the investor will not effect

a conversion under its note until the earlier of (i) the uplisting transaction closing or

(ii) the maturity date.

to a Promissory Note Amendment Agreement with one investor holding

a promissory note in the principal amount of $25,000 with accrued interest of $2,971, the

investor agreed to:

(a) extend the maturity date of its note to the earlier of (i) March

31, 2025 or (ii) the closing of an uplisting transaction in which our common stock is traded

on a national securities exchange and (b) impose a limitation on conversions so that the

investor will not effect a conversion under its note until the earlier of (i) the uplisting

transaction closing or (ii) the maturity date.

to a Convertible Note Amendment Agreement with each of five investors holding convertible notes in the aggregate principal amount

of $ 1,750,000 with accrued interest of $125,646, each of these investors agreed to (a) extend

the maturity date of their note to the earlier of (i) September 30, 2024 or (ii) the closing of an “uplisting” transaction

in which our common stock is traded on a national securities exchange and (b) impose a limitation on their conversions so that the

investor will not effect a conversion under its note until the earlier of (i) the uplisting transaction closing or (ii) July 1, 2024.

to a Convertible Note Amendment Agreement with one investor holding a convertible note in the principal amount of $50,000 with accrued

interest of $3,583, the investor agreed to:

(a) extend the maturity date of its note to the earlier of (i) March 31, 2025 or (ii)

the closing of an uplisting transaction in which our common stock is traded on a national securities exchange and (b) impose a limitation

on its conversions so that the investor will not effect a conversion under its note until the earlier of (i) the uplisting transaction

closing or (ii) the maturity date.

to a Promissory Note Amendment Agreement with one investor holding a promissory note in the

principal amount of $25,000 with accrued interest of $2,971, the investor agreed to:

(a) extend the maturity date of its note to

the earlier of (i) March 31, 2025 or (ii) the closing of an uplisting transaction in which our common stock is traded on a national

securities exchange and (b) impose a limitation on conversions so that the investor will not effect a conversion under its note until

the earlier of (i) the uplisting transaction closing or (ii) the maturity date.

consideration for the extensions of the maturity date and agreement not to convert their notes,

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Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 2. Management’s Discussion and Analysis