Blue Orca-做空Piedmont锂业公司（英）-2023.3

THISRESEARCHREPORTEXPRESSESSOLELYOUROPINIONS.Weareshortsellers.Wearebiased.Soarelonginvestors.SoisPiedmont.SoarethebanksthatraisedmoneyfortheCompany.Ifyouareinvested(eitherlongorshort)inPiedmont,soareyou.Justbecausewearebiaseddoesnotmeanthatwearewrong.UseBOCTexas,LLC’sresearchopinionsatyourownrisk.Thisreportanditscontentsarenotintendedtobeanddonotconstituteorcontainanyfinancialproductadvice.Investorsshouldseektheirownfinancial,legalandtaxadviceinrespectofanydecisionregardinganysecuritiesdiscussedherein.Youshoulddoyourownresearchandduediligencebeforemakinganyinvestmentdecisions,includingwithrespecttothesecuritiesdiscussedherein.WehaveashortinterestinPiedmont’sstockandthereforestandtorealizesignificantgainsintheeventthatthepriceofsuchinstrumentdeclines.Pleaserefertoourfulldisclaimerlocatedonthelastpage.

COMPANY:PiedmontLithiumInc.│NASDAQ:PLL

INDUSTRY:Lithium

PRICE(ASOFCLOSE3/7/2023)

USD57.14

MARKETCAP

USD1.1BN

PiedmontLithiumInc.(“Piedmont”orthe“Company”)isapre-productionlithiumstockpromotionthatboastsa$1.1billionmarketcapitalizationonthepromisethatitsnewlyannouncedTennesseeconversionfacilitywillproducebatterygradelithiumunderasweetheartsupplydealfromaGhanalithiummine.PiedmontclaimsthatrevenuesandprofitswillflowfromTennesseein2025,butwebelievethatisafantasy.

In2021,Piedmontcommittedtoinvestover$100millionintoamineinGhanathroughUK-listedjuniorminingcompanyAtlanticLithium(“Atlantic”)tosecurespodumeneofftake.However,ourinvestigationofsourcedocumentsandGhanacorporaterecordsindicatesthatAtlanticobtainedkeyGhanamininglicensesbymaking

secretpaymentsandpromisesofpaymenttotheimmediatefamilyofahigh-levelGhanapolitician.Specifically,

AtlanticpaidandpromisedtensofmillionsofdollarsinpotentialroyaltiestoacompanysecretlyownedbythesonofaleadingpoliticianknownasGeneralMosquito,whopreviouslyservedinGhana’sParliamentasChairoftheMinesandEnergyCommittee.

Inouropinion,evidenceofAtlantic’spaymentstothesonofahigh-levelpoliticianformininglicensesistextbookevidenceofcorruption.AtlanticstillneedsGhana’sParliamenttoapproveandratifyitsmininglicensesandpermitsinordertobuildthelithiummine.BasedonprecedentsinGhanaandaroundAfrica,includingarecentdecisionbyGhana’shighestcourt,wedonotbelievethatauthoritiesinGhana(includingtheParliament)willratifyAtlantic’smininglicensestaintedbycorruption.

WeareshortPiedmontbecausewithoutAtlantic’sGhanasupply,Piedmontandanypromiseofnear-termrevenuefromitsmuch-hypedTennesseefacilityaredeadonarrival.WithoutGhana,industryexpertsandevenaformerPiedmontseniorexecutivehaveconfirmedthatPiedmontisunlikelytofindasourceofreplacementspodumene.Additionally,FOIArequestsweobtainedfromtheDepartmentofEnergy(“DOE”)suggestthatthespodumenefromGhanawasimportanttoPiedmont’sgrantproposal,meaningthatthelossoftheofftakeagreement,andquestionssurroundingPiedmont’sownpotentialliabilityundertheFCPAandotheranti-corruptionstatutes,raisedoubtaboutwhetherPiedmontwillultimatelyreceivetheconditionalgovernmentfunding.

Ultimately,thepremiseofPiedmont’svaluationistheCompany’sclaimthatitwillsoonleveragespodumenefromGhanatobecomeafullyintegratedlithiumhydroxideproducer.Wethinknot.

1.Corruptpaymentstosonofhigh-levelpoliticianformininglicenses.Piedmontcommittedtoinvestover$100millioninLondon-listedAtlantictosecure50%ofthespodumeneofftakefromAtlantic’sflagshipGhanalithiummine.Constructionofthemineissettobeginthisyearwithproductionforecastedin2H2024.However,ourextensiveduediligenceofcorporatefilingsandpublicrecordsinGhanashowthatAtlanticsecuredkeymininglicensesinGhanabypayingandpromisingtensofmillionsofdollarsinroyaltypaymentstoaGhana-basedcompanysecretlyownedbythesonofamanknownasGeneralMosquito,oneofGhana’shighest-rankingpoliticianswhohasstronginfluenceinGhana’sminingsector.GeneralMosquitowasformerlythechairmanoftheMinesandEnergycommitteeinGhana’sParliament.AtthetimeofAtlantic’sacquisition,hewastheleaderofthepartyinjointcontrolofGhana’sParliament,thelegislativebodychargedwithapprovingallmininglicensesinGhana.Paymentsandthegrantingofaroyaltytothesonofsuchaninfluentialpoliticianis,inouropinion,textbookevidenceofcorruption.

2.WebelievethatAtlantic'smininglicenseswillnotberatifiedbecauseofcorruption.AtlanticstillneedsGhana’sParliamenttoapproveandratifyitsmininglicensesandpermitsinordertobuildthelithiummine.ButAuthoritiesinGhana,andacrossAfrica,haveahistoryofrevokingminingrightsobtainedviacorruptpaymentstohighlevelpoliticiansandofficials.Thisisespeciallytruewhen,likehere,GeneralMosquitoisahigh-profilememberoftheoppositionpoliticalpartywhohassincelostpower.ThehighestcourtinGhanarecentlyupheldtherevocationofamininglicensethatthepreviousadministrationhadawardedtoacompanyownedbythebrotherofGhana’spreviousPresident.Critically,localmediaandpoliticiansinGhanahavealreadyaccusedGeneralMosquitoofotherinstancesinwhichheallegedlyobtainedcorruptpaymentsforgovernmentcontractsthroughshellcompaniesownedbyhisson.WethinkthisistheexactschemebywhichAtlanticobtainedkeylithiummininglicenses.GiventhatAtlanticmustseekratificationofitsmininglicensesfromGhana’sParliament,theverybodywhosemembershaveaccusedGeneralMosquitoofcorruption,wedonotbelievethatauthoritiesinGhanawillapproveAtlanticforconstructionofthelithiummine.

PiedmontLithiumInc.│NASDAQ:PLL

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3.Piedmont’sTennesseefacilityisdeadonarrival:noavailablesourcetoreplaceneartermspodumeneofftake.AccordingtoPiedmont,Atlantic’sGhanamineistobetheprimarysourceofspodumeneforitsTennesseeconversionfacility.WithoutGhana,Piedmont’sTennesseefacility,andanypromiseofmaterialneartermrevenuefromTennessee,aredeadonarrival.SupplyofspodumeneissotightthatifPiedmontlosesitsGhanasupply,aswesuspectitwill,PiedmontcannotsimplyreplacetheGhanaspodumeneofftakewithadifferentproducer’sofftake.It’stoolateforthat–thereisamassivesupplyshortageandthereisnolongerenoughneartermspodumeneproductionavailableforofftake,especiallythelargequantitiesPiedmontneedstofeedtheTennesseefacility’scapacity.WeinterviewedaformerPiedmontseniorlevelexecutiveaboutpotentialofftakeoptionsforPiedmont.Hisresponse:Piedmonthasnooptions,itis“locked-in”and“hasgottamakeitwork”withGhanatomakeTennesseework.

4.Piedmont’sDOEgrantforTennesseefacilityimperiledoverFCPAquestionsandlackofspodumene.

Piedmont’sstocksoaredonnewsthattheU.S.DepartmentofEnergyselectedPiedmontfora$141.7millioncost-sharinggrantforconstructionoftheTennesseefacility.ButthegrantisnotfinalandexpresslysubjecttofurtherconditionsandDOEapprovals.AfterrecentCongressionalcriticismofMicrovast(NASDAQ:MVST),anotherDOEbatterygrantrecipient,thegovernmentisnowreexaminingallofitsbatterygrants,includingTennessee.WethinkTennesseewillbeatthetopofthechoppingblockfortworeasons.First,withoutspodumenefromGhana,theTennesseefacilityisdeadonarrival,meaningthegrantwillbeawasteofgovernmentspendingthatcouldgotoadifferentcompanythatmayactuallyproduceneartermlithiumhydroxide.Second,thereareopenquestionswhetherPiedmontkneworshouldhaveknownofthecorruptioninGhanawhenitappliedfortheDOEgrant.In2021,PiedmontclaimedtohaveconductedmonthsofduediligenceontheGhanainvestment.EitherPiedmontdidnotfindthepublicinformationthatwereadilyfound,orPiedmontknewofthepaymentsandsweptitundertherug.Eitherway,wethinkDOEandothergovernmentauthoritieswilllikelyhaveseriousquestionsforPiedmontthatcouldthreatenthe$141.7milliongrantawardandraisethespecterofPiedmont’spotentialliabilityundertheForeignCorruptPracticesActandotheranti-corruptionlaws.

Piedmontearnszerorevenuesbutenjoysa$1.1billionmarketcapitalizationonitspromisethatitwillcapturehighmarginsfromsellingbatterygradelithiumatelevatedpriceswhilelithiumsupplyremainsconstrictedinthenear-to-mediumterm.Piedmont’sstatedvisionistobecome“aleadingAmericanproduceroflithiumhydroxideallproducedfromspodumeneconcentratethatweownorcontrol.”TheCompanyhasfourearly-stagelithiumdevelopmentprojects:aproposedCarolinalithiummineandconversionfacility;anofftakeagreementinQuebecwithajointventurepartner;aninvestmentcommitmentinLondon-listedAtlanticthroughwhichitsecuredanofftakeagreementfromadevelopmentstageGhanalithiummine;anditsproposedTennesseefacilitywhichaimstomakebatterygradelithiumbyconvertingrawmaterialsourcedprincipallyfromGhana.

TheCompany’sCarolinaprojectisstalledonaccountofpermitting,zoningandanuneconomic11.6xstripratio.Piedmont’srecentlyannouncedshort-termofftakedealwithTeslaandLGChemforspodumenefromtheQuebecminecouldgeneratesomeshort-termcashflowifthemine,whichbankruptedtwopreviousowners,becomesviable.However,Piedmontdidnotearnitslofty$1.1billionvaluationbecauseofitsprospectstoearnsomeshort-termcashre-sellingspodumenetoTeslaandLGChem.

RatherPiedmont’svaluationiscontingentontheofftakeagreementwithAtlantic’sGhanaminetosupplytheTennesseeconversionfacility,whichtogetherwillsupposedlyenablePiedmonttomakeandselllithiumhydroxidetoEVbatterycustomers.WithoutGhana,itsprimarysourceofspodumene,webelievethatPiedmont’sTennesseefacilitywillbeunabletoobtainareplacementsupplyoflithium.

TheGhanamineisthelynchpininPiedmont’svaluation,itspromiseofnear-termandmedium-termrevenuesandprofits,andthehypestoryitsellsinvestors.YetitisthisveryGhanaminewhoselicenses,inouropinion,arelikelytoberevokedornotratifiedonaccountofcorruption.

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IntroducingaSuspectStockPromote

Piedmontisanearly-stagelithiumdevelopmentbusinessfoundedinAustraliain2016andredomiciledtotheU.S.in2021.Piedmonthaslongbeenaccusedofbeinga

stockpromotion

,includingbyshortsellerCulperResearchinascathingreportissuedin2022.Piedmont’slong-timeformerdirectorwasbarredfromtheAustralianSecuritiesandInvestmentCommissionforallegedmanipulationofminingstocks.Heremainsthelargestindividualshareholdertoday.Othernow-formerPiedmontinsidershave

links

toatleastsixotherpubliclylistedminingventureswhichhavecollapsed.

Piedmontburstontothescenein2020whenit

signed

adealtosupplyTeslawithspodumenefromadevelopmentstagemineinGastonCounty,NorthCarolinathatitintendstoeventuallyintegratewithalithiumhydroxideconversionfacility.TheannouncementcausedPiedmont’sstocktoripover600%inafewmonths.Yetthisprojecthasgonenowhereandhaslargelybeenanunmitigateddisaster.

PiedmontcannotgettheCarolinaprojectpermittedorzonedasfiercelocal

opposition

hasemergedtofighttheproject.Localnewsmedia

published

scathingstoriesaboutPiedmontmanagementalongwithinternalemailsfromNorthCarolinaofficialsquestioningPiedmont’scommitmentandcompetencetoobtainthepermits.Shareholdersfiledsecuritiesfraudclassactions

alleging

thatmanagementliedaboutthepermittingsituationwhileinsiderssoldmillionsofdollarsofstock.Piedmonthassince(wethinkoptimistically)pushedtheproject’stimelineoutfiveyears-from2022to2027.Theprojecthasnotmeaningfullyadvancedinseveralyears,andappearsdeadinthewater.

WheninvestorslostfaithinPiedmont'sCarolinaproject,theCompanycleverlypivotedthenarrativefromitsflopinCarolinatoitsGhana-Tennesseehypestory.In2021,Piedmontcommittedtoinvestover$100millioninaLondon-listedjuniorminertosecureofftakefromAtlantic’sspodumenedevelopmentprojectinGhana.Specifically,Piedmontagreedtomakea$15.9millioninvestmentinAtlanticfora9.9%equitystakeinthejuniorminerandcommitanother$87milliontoinvestintheGhanaproject.Inexchange,Piedmontreceivedtherighttoa50%stakeintheGhanaassetsalongwiththerightto50%spodumeneofftakeatmarketvalueforthelifeofthemine.Piedmontalsoagreedtopay50%ofanycapitalcostoverrunsontheminedevelopment(forecastedinSeptember2022tobeanadditional$55million($27.5millionPiedmontshare).

PiedmonthasmadeitsinterestinAtlantic’sGhanamine,anditscrucialGhanaofftakeagreement,thecenterpieceofitspromisetodeliverneartermlithiumhydroxidetoEVbatteryproducers.AfterannouncingtheGhanadeal,PiedmontannouncedanewflagshiphydroxideconversionfacilityinTennessee,tobesuppliedfromGhanaandfundedinlargepartbygovernmentloansandaDepartmentofEnergycost-sharinggrant.

Source:BlueOrcaGraphic

PiedmonttellsinvestorsthatitexpectsproductionfromTennesseeasearlyas2025-atimelinethat,inouropinion,isunreasonablyaggressiveevenwithoutevidenceofcorruptpaymentsinGhana,giventhatconstructionhasnotyetstartedineitherGhanaorTennesseeandneitherprojecthasobtainedanykeypermits.

Nevertheless,Piedmont’sstockhasbouncedbackfromthedisappointmentofthefailingCarolinaprojecttonearall-timehighs,largelyonthepromisethatspodumenefromGhanawillfeedTennessee.Wethinknot.

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I.CorruptPaymentstoSonofHigh-LevelGhanaPoliticianforMiningLicenses

CorruptionisillegalandascourgeontheminingindustryinAfrica.Miningrightssecuredthroughundiscloseddirectandindirectpaymentstoseniorpoliticalofficialsareregularlysuspendedandrevoked.

AtlanticacquiredkeyminingrightsforitsflagshiplithiumprojectinGhanabypurchasingalocalcompanywhich,undisclosedtoinvestors,wassecretlyownedbytheimmediatefamilymemberofamanknownasGeneralMosquito,aseniorpoliticianwhopreviouslyservedasChairmanoftheMinesandEnergyCommitteeofGhana’sParliamentandremainsinfluentialinGhana’sminingsector.Inouropinion,theevidenceclearlyindicatesthatAtlanticobtainedmininglicenses

1

bypayingthesonofahigh-rankingpoliticianandpromisingtensofmillionsofdollarsinroyalties.Inourview,thisappearstobetextbookcorruption.

WethinkthatcorruptpaymentstotheimmediatefamilyofaGhanaianpoliticianformininglicensesjeopardizethefutureofAtlantic’sprojectinGhana.TherearenumerousinstancesinwhichGhanahascancelledor

revokedmining

licenses

afterrevelationsofcorruptpayments,aswellasamultitudeof

otherexamplesacrossAfrica

wherelicenseshavebeenrevokedwhensuchpaymentshavecometolight.Thisdangerisparticularlyacutehere,asfollowingthemostrecentchangeinpower,newlyelectedGhanaianpoliticalleaderscalledforaninquiryintomininglicensesgrantedbythepreviousregimeinexchangeforpaymentstohigh-rankingpoliticians.

AtlanticstillneedsGhana’sParliamenttoapproveandratifyitsmininglicensesandpermitsinordertobuildthelithiummine.WethinkthatcorruptpaymentsmakeithighlyunlikelythatAtlantic’smininglicensesinGhanawillberatified,meaningAtlanticwillneverbeabletosupplylithiumfromGhanaforPiedmont’sTennesseeconversionfacility.WithoutAtlantic’sGhanaiansupply,Piedmonthasnonear-termabilitytosupplylithiumhydroxidetoEVbatterycustomers.

1.AtlanticPaidtheSonofProminentGhanaPoliticiantoAcquireMiningLicenses

In2021,

Atlanticacquired

alocalGhanaentity,JoyTransporters,toobtainmineralrightsandlicensesontwoofthefourtenements(SaltpondandCapeCoast)forAtlantic’sflagshiplithiumprojectinGhana.

2

ToacquireJoyTransporters,Atlanticpaidtheowners$730,000instockandpromisedthesellersanadditional2.5%productionroyaltypotentiallyworthtensofmillionsofdollars.

AtlanticneverdirectlydisclosedthenamesofJoyTransporters’principals,butourextensiveduediligenceofpublicinformation,databasesandcorporaterecordsinGhanaindicatesthatJoyTransporterswasownedbythesonofahigh-rankingpolitician:JohnsonAsieduNketiah(a/k/aGeneralMosquito),theNationalChairmanoftheNationalDemocraticCongress,oneofGhana’stwomainpoliticalparties.

Theevidenceisoverwhelming.InconnectionwithitsSeptember2022ASXexchangelisting,Atlanticfileda288-pageprospectusincludinga“LegalReportonTenements”authoredbyaGhanalawfirmonthevalidityofthemineralrightsandprospectinglicenses.

BuriedinthisreportwasascheduleidentifyingtheprincipalsofJoyTransportersandthesellersofthemineralrightsandprospectinglicensestoAtlantic.The“ShareSaleandPurchaseAgreementdatedMarch11th,2020,”wasbetween“KwakuAsiedu-Nketiah,AlbertKwateng,IronRidgeResourcesLimitedandJoyTransporters.”

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1"Forclarity,wereferto"mininglicenses"collectivelytomeanprospectinglicensescoveringthewesterntenementsofAtlantic’sflagshipCapeCoastLithiumPortfolioproject."

2Thesetwotenementsare,accordingtoAtlantic,

adjacent

totenementsonwhichAtlantichasalreadydelineatedalithiumresource.Atlanticiscountingonthesetwotenementstogrowthesizeoftheresourceandimprovetheproject’seconomics,inparticulartheproject’srelativelyshort12.5-yearlifeofminenow

forecasted

intheSeptember2022PFS.Atlanticisintheprocessofaggressively

exploringthesetenements

andhasidentifiedseveralhighprioritydrilltargetsjustafewkilometersawayfromtheexistingresource,onstrike,andwithsimilargeology.

3Theotherlistedindividual,AlbertKwateng,appearsto

work

foracompanyownedandcontrolledbyKwakuAsiedu-Nketiah,KayabMaritimeServices.

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Source:

August2022AtlanticLithiumReplacementProspectus,Ex.2LegalReport

KwakuAsiedu-Nketiah,thesellerofthemineralrightsandprospectinglicenseslistedinthesharepurchaseagreementwithAtlantic,isthesonofJohnsonAsieduNketiah(a/k/aGeneralMosquito),theNationalChairmanofGhana’sNationalDemocraticCongresspoliticalparty.OnhisLinkedIn,KwakustatesthatheisthePresidentofaholdingcompanythatownsJoyTransporters.

Source:

LinkedInprofile

GeneralMosquito’s

profile

listsKwakuasoneofhischildrenandincludesafamilypictureshowingthemboth.GhanaianmediahasalsopublishedoccasionalphotosofGeneralMosquitotogetherwithhisson,theownerofJoyTransporters.

Source:

Newsarticle,January2021

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WesuspectthatAtlanticmadethesepaymentstosecuretheminingpermitsbecause,atthetimeofthetransaction,thefatherwasnotonlyaseniorpartyfunctionaryandformerChairmanoftheMinesandEnergyCommitteeofGhana’sParliament,butahigh-profilefigurewithparticularinfluencewithinGhana’sminingsector.

UnderGhana’smininglaws,thefinalstepinobtainingapprovalforamininglicenseisto

obtaintheratification

ofGhana’sParliament.AtthetimeoftheJoyTransportersacquisition,GeneralMosquitoservedastheGeneralSecretaryoftheNDCpartywhiletheNDCpartyjointlycontrolledtheparliamentthatwouldhavefinalauthorityoveranymininglicensedecision.HisinfluenceinGhanapoliticsandspecificallyGhanaminingcannotbeunderstated,includingthatheservedinParliamentasChairmanoftheMinesandEnergyCommittee.Today,heremainsanotablepoliticalfigureintheGhanaminingindustry.

Source:

Newsarticle,October14,2022

AtlanticpaidGeneralMosquito’ssonandhiscadre$730,000toacquireJoyTransporters,butthiswasonlytheappetizer.Additionally,AtlanticgrantedJoyTransportersa2.5%productionroyalty(subjecttoa50%buybackrightfor$3million),thetermsofwhicharedescribedintheLegalReportandina2018newsrelease.

Source:

AtlanticNewsRelease,January17,2018

Ifweusethepre-feasibilitystudythatAtlanticcompletedontheadjacenttenementsasaroughproxy,weestimatethevalueofthe2.5%royaltygrantedtoGeneralMosquito’ssonatover$40million.

4

Putsimply,tosecurelithiumminingrights,Atlanticpromisedtensofmillionsofdollarstothesonofthepoliticianwithinfluenceovertheapprovalofminerallicensingrights.

4Atlantichasnotcompletedthepre-feasibilitystudyforthesetenements.Forreference,

Atlantic’sPFS

ontheadjacentMankessiumandMankessiumSouthtenementsvaluesa1%“localpartnerroyalty”onthosetenementsat$47.5millionovertheprojected12.5-yearlifeofmine.SeeFootnote7.

7

Source:CompaniesPublicFilings

5

,OnlineSearch

Notably,localGhanamediaandhigh-rankingmembersofGeneralMosquito’sownpartyhavealreadypubliclyaccusedthepoliticianofcorruptionbyfunnelingcorruptpaymentsthroughshellentitiesaffiliatedwithhisson,theexactpatternwebelievewehaveuncoveredwithrespecttoAtlantic’spurchaseofJoyTransporters.

Thisincludesanarticlespecificallymentioningfather,sonandJoyTransporters,andallegingthatthefather“handledallthelucrativecontractsfortheNDCgovernmentunderhissonKwakuAsieduNketiahJr.”

Source:

Newsarticle,November2022

Theseaccusationsaregainingsteam.LocalmediainGhanahavefurtherreportedthathighrankingmembersofGeneralMosquito’sownNDCpartyhaverecentlyaccusedtheNationalChairmanofsteeringalucrativecontracttoacompanythatissecretlyownedbyhisson.

5*130.4millioninvestmentiscomprisedof$15.9millionequityinvestmentinAtlantic,$87millioncommittedstagedinvestmentinGhanaminedevelopment,and$27.5millioncommitmenttoshare50%ofcapitalcostoverruns(forecastedinSept.2022PFStobe$55M).AsofDecember31,2022PiedmonthadpaidAtlantic$32.9millionofitstotalinvestmentcommitment.

8

Source:

Newsarticle,November24,2022

PoliticiansandlocalmediahavepubliclyaccusedGeneralMosquitooffunnelingcorruptpaymentsthroughshellentitiesownedbyhisson.Inouropinion,thisistheexactpatternwefoundhere,asitclearlyappearsthatAtlanticpaidthepoliticalleader’ssonforkeymininglicensesthroughtheacquisitionofJoyTransporters.

Aswewilldiscussbelow,webelievethatcorruptpaymentswilllikelyjeopardizethemininglicensesgrantedtoAtlantic,whichwillcrushPiedmont’sonlysourceofspodumeneforitsnewTennesseeplant.

2.OtherMiningLicensePurchasedfromHeadofGhanaOlympicCommittee

Inadditiontopayingthesonofaformerparliamentarypoliticianandcurrenthigh-levelpoliticalpartyfunctionarywithinfluenceovermininglicenses,Atlanticpaidanotherhigh-levelofficialinconnectionwithitsminedevelopment.

AtlanticacquiredtherightstoanotherportionofitsGhanalithiumprojectbyacquiringaGhanacompany,BarariDVGhanaLtd.(“Barari”).TheBarariareaisadjacenttoJoyTransporters’tenements.SimilartoJoyTransporters,Barariappearstohavebeensecretlyownedbyahigh-levelofficial.Specifically,Atlantic’sLegalReportstatesthatBarariis10%ownedbyBenNunooMensah.

Source:

August2022AtlanticLithiumReplacementProspectus,Ex.2LegalReport

OurresearchshowsthatBenNunooMensahisthePresidentoftheExecutiveBoardoftheGhanaOlympicCommittee.Aformerinsuranceexecutive,MensahpreviouslyheldvariouspositionsinGhanaiansportsorganizations,whichhavehistoricallybeencovetedgovernmentappointments.

Source:

GhanaOlympicCommitteewebsite

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AtlanticagreedtopayMensahavaluableproductionroyaltyequalto2%ofnetsmelterreturn.

6

AccordingtoAtlantic’spre