AQMS

Commercialization of AquaRefining Platform

• Continued advancing site selection and engineering work for the first commercial lithium battery recycling facility in the U.S., with a shortlist of locations evaluated based on feedstock access, logistics, strategic relationships and long-term operating economics
• Surpassed 5,000 cumulative operating hours across extended multi-feedstock campaigns at the Reno innovation and demonstration plant, validating the AquaRefining platform and commercialization pathway

Technical Milestones Achieved

• Successfully produced independently validated battery-grade lithium carbonate from both NMC (nickel manganese cobalt) and LFP (lithium iron phosphate) recycled feedstocks
• Achieved 99.8% purity for manganese sulfate production, demonstrating AquaRefining's applicability to additional critical minerals and battery precursor markets
• Advanced iron phosphate recovery work from LFP materials, which strengthens competitive position as LFP adoption accelerates in electric vehicles and stationary energy storage
• Demonstrated battery-grade lithium carbonate with best-in-class fluorine levels for recycled sources globally, with a cost profile competitive with incumbent domestic and international processes

Strategic Initiatives

• Maintains ongoing commercial relationships with 6K Energy, Westwin Elements, Impossible Metals, Mobi Robotics and American Battery Factory to broaden participation in the battery and energy storage ecosystem -Decided not to proceed with the acquisition of Lion Energy under the previously announced non-binding term sheet after due diligence, as the original structure did not align with capital discipline, risk profile and shareholder value objectives; continues to evaluate alternative capital-efficient strategic structures to integrate energy storage solutions with domestic battery materials infrastructure

Capital Discipline

• Preserved capital and maintained core technical capabilities through the 2024-2025 lithium price downturn, when many industry projects were delayed/canceled and multiple companies faced insolvency/restructuring, positioning the company ahead of the current industry recovery
• Remains focused on capital preservation and disciplined spending, prioritizing resources for core commercialization activities and maintaining strategic flexibility

There is no specific formal numerical financial guidance provided in this call. Management's forward-looking priorities and expectations are:

• Site selection for the first commercial recycling facility is far along, with management expecting to finalize selection in a reasonable time frame; stepping back from the original Lion Energy acquisition structure increases flexibility to optimize site selection around core business needs
• Remaining milestones for commercial facility development focus on process optimization, integration, throughput validation and commercial configuration; core process chemistry and flows are already fully validated
• Management expects to provide updates to the market on progress for site selection, commercial agreements and alternative strategic energy storage initiatives in the near term
• The company is well-positioned to meet growing industry demand for domestic recycled battery materials amid recovering lithium prices and policy support for North American battery supply chain localization

Aqua Metals is a development-stage company focused on its AquaRefining battery recycling platform, and does not report separate product segment revenue in this quarter. For Q1 2026, the company reported a net loss of $4 million ($1.22 per basic/diluted share), compared to a net loss of $8.3 million ($10.27 per share) in Q1 2025. The year-over-year improvement was driven by the absence of the noncash impairment charges recorded in the prior year period. Total operating expenses were $4.1 million in Q1 2026, down from $8.7 million in Q1 2025. The company ended the quarter with $6.8 million in cash and cash equivalents and $7.5 million in working capital. Cash used in operating activities was $3.8 million for the quarter. The company raised $1.3 million in net proceeds via its ATM program in Q1 2026, with $48.6 million remaining available under the program. In connection with the proposed Lion Energy acquisition, the company contributed its outstanding note balance and advanced an additional $2 million for a subordinated participation interest in Lion Energy's senior secured credit facility, and recorded a $437,000 provision for credit losses in the quarter.

• The proposed Lion Energy transaction carries credit risk: the company has $4.1 million in total exposure, with partial loss reserves already recorded; recovery depends on Lion Energy's future performance, collateral values and potential restructuring scenarios, though the company holds a secured position
• Forward-looking commercialization outcomes are subject to risks including site permitting delays, difficulty securing project financing, failure to convert non-binding commercial relationships to binding agreements, and unexpected technical issues during scale-up
• Lithium price volatility could impact project economics and industry demand for recycled battery materials
• The company has limited cash on hand and will need additional financing to complete the first commercial facility, with no guarantee that financing will be available on acceptable terms

Q: What led Aqua Metals to walk away from the planned Lion Energy acquisition, are alternative discussions still ongoing, and what is the status of the company's credit exposure to Lion Energy? / A: After detailed due diligence, management determined the original acquisition structure did not align with Aqua Metals' capital discipline, risk appetite, and shareholder value goals. The broader strategic thesis of combining energy storage with domestic battery materials infrastructure remains valid, so the company is evaluating more capital-efficient, risk-balanced alternative structures to participate in this space. / A: Total exposure to Lion Energy is $4.1 million; a partial loss reserve was recorded per GAAP accounting standards reflecting current uncertainty. Aqua Metals holds a secured junior position, and is actively monitoring developments and evaluating potential recovery outcomes tied to collateral and restructuring scenarios, while maintaining focus on downside protection and capital preservation. (508 characters)

Q: What key milestones should investors watch for over the next 12 to 18 months? / A: The top near-term milestone is finalizing site selection for the first commercial recycling facility, which is already far along with site visits completed for the shortlist of locations. Selection criteria prioritize feedstock logistics, infrastructure, utility costs, permitting, workforce access, and proximity to strategic partners. / A: Walking away from the original Lion structure actually increases site selection flexibility by allowing the company to optimize purely for core business long-term economics. The company will provide market updates as it makes progress on alternative energy storage strategic initiatives. (412 characters)

Q: What remaining technical and commercial milestones must be met before committing to a site and starting FEL2 engineering for the first commercial facility? / A: Core process chemistry and flow validation are already complete; current focus is on process optimization, integration, throughput validation, and commercial plant configuration. Work continues on refining impurity management, improving reagent efficiency, operational stability, and validating overall process economics. / A: Commercial milestones including site selection, feedstock alignment, infrastructure planning, customer qualification, and project financing discussions are progressing in parallel, as management follows a disciplined phased approach to ensure the first facility is positioned for long-term success. (407 characters)

Q: Have any of the existing commercial partnerships with 6K Energy, Westwin Elements, and other firms moved from non-binding to binding agreements, and what is the conversion timeline? / A: All existing partnerships continue to deepen both technically and commercially, but most discussions are naturally sequenced alongside commercial plant site selection and commercialization timing. Binding agreements typically cannot be finalized until the site is secured and project plans are formalized. / A: Strong industry demand for domestic low-carbon recycled battery materials remains, and recovering lithium prices from the 2024-2025 downturn leave Aqua Metals well-positioned as one of the few remaining North American developers able to deliver on commercial opportunities. (389 characters)