5E Advanced Materials, Inc.

Each of the risks described below should be carefully considered, together with all of the other information contained in this Annual Report, before making an investment decision with respect to our securities. In the event of the occurrence, reoccurrence, continuation or increased severity of any of the risks described below, our business, financial condition or results of operations could be materially and adversely affected, and you may lose all or part of your investment. The risks included here are not exhaustive. Other sections of this Annual Report may include additional factors which could adversely affect our business and financial performance. New risks emerge from time to time and it is not possible for management to predict all such risks, nor can it assess the impact of all such risks on our business or the extent to which any risk, or combination of risks, may cause actual results to differ materially.

Risks Relating to Our Business

There is substantial doubt regarding our ability to continue as a going concern. We will need to raise substantial additional funding, which may not be available on acceptable terms, if at all, to continue as a going concern and advance the Project.

There is substantial doubt regarding our ability to continue as a going concern. Our existence in our current form is dependent upon our ability to obtain additional capital. In addition, if the pending Acquisition of assets from SVM described elsewhere in this Annual Report is consummated, our capital requirements will increase, including the remaining cash consideration payable by us at the consummation of the Acquisition (the “Closing”), our transaction costs and our working capital and operating requirements of the acquired business. Our cash and cash equivalents, including liquidity improvement resulting from our February 2026 financing, as of the date of this Annual Report will not be sufficient for us to continue as a going concern or to fund our long-term operations and proposed development of the Project. Raising funds in the current economic environment has been and continues to be challenging, and financing may not be available in sufficient amounts or on acceptable terms, if at all. The issuance of additional securities, whether equity or debt, including pursuant to the Acquisition, or the possibility of such issuance, or the securing of financing that investors consider to be unfavorable to us, may cause the market price of our shares to decline. The sale of additional equity or debt securities would dilute the ownership of existing stockholders.

We will need to obtain substantial additional financing to continue as a going concern, advance FEL-3 and related technical work, and develop the proposed commercial-scale facility.

We have limited assets upon which to develop and commence our business operations and to rely otherwise. We will need to seek significant additional funds in the future through one or more equity financings, debt financings, strategic investments, government funding or grants, project-level financing, royalty arrangements, customer prepayments, offtake-linked financing, commercial arrangements or other strategic alliances with third parties, either alone or in combination. Our business plan, which includes the development of the Project, has required and will continue to require substantial capital expenditures. We will require financing to fund continued operation of our Small-Scale Facility (the “SSF”), FEL-3 engineering, additional technical and design work, customer qualification and commercial development activities, corporate overhead, construction, commissioning, initial commercial production and working capital requirements.

Our near-term business plan depends on obtaining additional capital to support, among other things, continued SSF activities, FEL-3 engineering, wellfield optimization, customer qualification and commercial development activities, permitting modifications, infrastructure planning, technical studies, corporate overhead and other operating costs. If we are unable to obtain sufficient capital on acceptable terms and on the timeline required, we may be required to delay, reduce the scope of, suspend or eliminate some or all of these activities, which could delay development of the Project, adversely affect our ability to obtain financing for the proposed Commercial-Scale Facility and materially adversely affect our business, liquidity, financial condition and ability to continue as a going concern.

The PFS included a capital estimate for Phase 1 of the proposed Commercial-Scale Facility, and the amount of capital ultimately required to complete development may be materially higher than the amounts currently estimated. Actual capital requirements will depend on, among other things, FEL-3 engineering, final feasibility work, wellfield design, procurement strategy, long-lead equipment costs, construction and labor costs, energy infrastructure, inflation, tariffs, contingency, owner’s costs, financing costs, permitting requirements, schedule changes and other factors. The size of the capital required to develop Phase 1 is substantial relative to our current market capitalization and available liquidity, which may make financing more difficult, expensive, dilutive or unavailable.

Any financing we pursue may be subject to extensive third-party diligence and conditions, including review of the PFS and updated technical report summary, FEL-3 engineering, wellfield design and performance, recovery rates, customer qualification, non-binding commercial arrangements and potential offtake support, permitting status, market studies, commodity price assumptions, environmental matters, title and other technical, legal, financial and commercial matters. Financing sources may not be satisfied with the results of such diligence or may require additional work, commitments or conditions before providing financing, which could delay, reduce, increase the cost of or prevent financing.

As previously disclosed, in September 2024, we received a non-binding letter of interest from the Export-Import Bank of the United States (“EXIM”) for a loan-backed guarantee on project debt financing of up to $285 million for our proposed Commercial-Scale Facility. We have had continued engagement with representatives from EXIM on the loan package, but we cannot make any assurances that the loan package will be finalized on a timely basis, or at all.

If we are unable to raise adequate funds, we may have to delay, reduce the scope of or eliminate some or all of our business plan expenditures, including FEL-3, wellfield optimization, customer qualification, development of our proposed Commercial-Scale Facility or operation of the SSF, and the failure to procure such required financing could have a material and adverse effect on our business, liquidity, financial condition, results of operations and ability to continue as a going concern. If we are unable to continue as a going concern, we might have to liquidate our assets and the values we receive for our assets in liquidation or dissolution could be significantly lower than the values reflected in our financial statements.

The inclusion of the going concern explanatory paragraph by our auditors, our lack of revenue, our development-stage status, our current market capitalization, our limited trading liquidity and our potential inability to continue as a going concern may materially adversely affect our business, share price, and ability to raise new capital or to enter into critical contractual relations with third parties due to concerns about our ability to meet our contractual obligations.

We have incurred significant net operating losses since our inception and anticipate that we will incur continued losses for the foreseeable future.

We had an accumulated deficit of $274.5 million as of June 30, 2026, and we expect to incur significant development, engineering, operating and corporate expenses for the foreseeable future related to the completion of development and commercialization of the Project. As a result, we expect we will continue to sustain substantial operating and net losses, and it is possible that we will never be able to sustain or develop the revenue levels necessary to attain profitability. If we are unable to raise sufficient capital to continue operating and developing the Project, our business, financial condition and results of operations could be materially and adversely affected.

Our future performance is difficult to evaluate because we have no or only a limited operating history in the minerals industry and no revenue from our proposed extraction operations at our properties, which may negatively impact our ability to achieve our business objectives.

Although the Project deposit was identified over 60 years ago and significant work has been undertaken to refine the resource estimate and development plan since that time, including by our immediate predecessor, ABR, which undertook significant development activities to develop the resource estimate and mine plan for the Project, we have not realized any material revenues to date from the sale of mineral products. To date, our operating cash flow needs have been financed primarily through equity and equity-linked financing and not through cash flows derived from our operations.

We currently produce an insignificant amount of material from our SSF and we have not sold any material amounts of product derived from our properties. As a result, our revenues are expected to be determined, to a large degree, by the development and future success of our proposed Commercial-Scale Facility at the Project, subsequent operating activities as well as ongoing commercial and marketing efforts to establish offtake agreements for material products. Our revenues will also be substantially impacted by the prevailing prices for borates and its derivatives, calcium chloride, gypsum and other byproducts, to the extent that these products can be successfully extracted. At the present time, the recovery process for lithium has not been field tested and determined, and the cost and efficiency of such process will likely not be addressed until a later point in our development cycle. For the products that we aim to successfully produce in the future, market prices are dictated by supply and demand, and we cannot predict or control the price we will receive for boric acid and its derivatives, calcium chloride, gypsum, lithium carbonate and other byproducts. Although management has identified currently favorable market conditions concerning the supply and demand of boric acid and advanced boron materials, future market conditions may be significantly less favorable as a result of numerous factors, including many that are beyond the scope of our control.

We were incorporated in September 2021, and we have only recently begun to implement our current business strategy. As a result, we have little or no historical financial and operating information available to help you evaluate our future financial and operating performance. Therefore, it is possible that actual costs may increase significantly, and we may not be able to achieve our expected results. The Project may ultimately be less profitable than currently anticipated or may not be profitable at all, which could have a material adverse effect on our results of operations and financial position.

Our inability to continue to operate the SSF, complete FEL-3 and further technical and economic studies, or successfully validate and optimize our wellfield design may have a material adverse impact on the Project.

The SSF is our smaller-scale boron facility and serves as a demonstration and validation facility for the design, engineering, customer qualification, operating assumptions and cost optimization for our proposed Commercial-Scale Facility at the Project. We believe the SSF has provided and may continue to provide valuable data and information to enhance detailed engineering, product qualification, wellfield design and operational processes for the proposed Commercial-Scale Facility.

The ongoing operation of the SSF, learnings and data collection are being undertaken in parallel with the engineering process for the proposed Commercial-Scale Facility. This approach has a higher risk of re-work of certain portions of the Project, as information and data we receive may cause us to revise or redesign portions of the proposed commercial-scale complex, causing potential delays and increased design costs. Additional technical and economic studies, including FEL-3 engineering, may be required to assist in determining the economic recoverability of mineral resources and reserves for the Project. An abbreviated process development approach may also lead to technical risk, and higher capital and operating expenditures. We cannot assure you that the proposed Commercial-Scale Facility at the Project will be completed on schedule, within budget or at all, or achieve an adequate return on investment. We are also a newly formed company which makes it more difficult for you to evaluate our track record of meeting various milestones or target completion deadlines.

In particular, our ultimate wellfield design, use of horizontal wells, injection and recovery configurations, permeability assumptions, solution chemistry, recovery rates, operating methods and scale-up assumptions remain subject to technical uncertainty. Results from the SSF, vertical wells, horizontal wells, step-rate testing or other technical work may not be representative of commercial-scale operations or may require us to modify the mine plan, wellfield design, processing facilities, costs, schedule or expected recoveries.

The SSF is maintenance intensive, requires us to incur operating costs including labor and raw materials, and may require additional capital expenditures to replace existing equipment, test proposed designs or processes or evaluate modifications to our processes. We cannot assure you that we will have access to sufficient capital to continue operation of the SSF, or that such costs and expenditures will result in a positive economic outcome for the Project. We also may not need to operate the SSF for an extended period if key technical, customer qualification or other objectives have been achieved, and we may elect or be required to curtail, idle, place on care and maintenance or decommission the SSF. Any such decision, or any other facts and circumstances indicating that the carrying value of the SSF or related assets is not recoverable, could result in impairment charges.

If we are unable to operate the SSF or complete FEL-3 and related technical and economic studies in a timely and cost-effective manner, or if such work results in changes to the expected economics, design, schedule or recoveries for the Project, our ability to develop the Project could be materially adversely affected.

We have invested and, subject to availability of adequate capital, plan to continue to invest significant amounts of capital in the Project.

We have invested significant capital in the Project, including resource drilling, monitoring wells, metallurgical test work, well injection testing, permitting activities, construction and operation of the SSF, pilot-scale test work, FEL-2 engineering and preparation of the PFS. Subject to availability of adequate capital, we expect to continue to invest significant capital in the Project, including FEL-3 engineering, additional technical and economic studies, wellfield optimization, commercial development, permitting modifications, long-lead procurement, development planning and potential construction of the proposed Commercial-Scale Facility.

The Project may require more capital than currently expected, including, without limitation, because of changes in design, scope, permitting requirements, capital costs, operating costs, inflation, tariffs, supply-chain conditions, energy infrastructure, construction labor, equipment costs, financing terms, schedule, contingency, owner’s costs, wellfield performance, recovery rates or other factors. If the Project does not proceed as planned, or if we are unable to finance or complete the Project, some or all of our prior and future investments may not be recovered, and we may be required to record impairments or other charges.

We have a limited history of mineral production, and we may not be able to successfully achieve our business strategies, including our downstream processing ambitions.

We are a development-stage company and we have a limited history of mining or refining mineral products from our properties. As such, any future revenues and profits are uncertain. There can be no assurance that the Project will successfully reach commercial-scale production of minerals or otherwise generate operating earnings. Advancing projects from the development-stage into commercial production requires significant capital and time and will be subject to further technical and economic studies, permitting requirements and construction of mines, processing plants, roads and related works and infrastructure. We will continue to incur losses until mining-related operations successfully reach commercial production levels and generate sufficient revenue to fund continuing operations. There is no certainty that we will generate revenue from any source, operate profitably or provide a return on investment in the future.

In addition, substantial additional capital will be required to develop and support potential downstream processing capabilities at the Project. The economic viability of the production of advanced boron materials at the Project will be dependent on a number of factors beyond the scope of our control, including the market demand for and competitive landscape of the advanced boron materials that we hope to produce. We cannot assure you that our downstream processing ambitions will operate profitably or provide a return on investment in the future.

We may be unable to develop, protect, obtain or acquire intellectual property required to implement our business strategy successfully.

Our strategy may depend in part on our ability to develop, protect, obtain or acquire intellectual property and know-how related to in-situ extraction, closed-loop processing, wellfield design, recovery, processing, reinjection, product specifications, impurity management, co-product processing and advanced boron materials. During fiscal year 2026, we filed a provisional patent application with the United States Patent and Trademark Office (“USPTO”) relating to the production process for meta boric acid. Also during fiscal year 2026, we filed an omnibus provisional patent application with the USPTO covering our proprietary closed-loop in-situ leach mining and production process, including claims relating to boric acid, gypsum, sodium chloride and management of metal impurities. We have also filed provisional patents with the USPTO specifically related to our production process for boric acid, our gypsum production process, and the different modes of operation and controls based on the composition of our feed stream. We may file additional patent applications or seek other forms of intellectual property protection in the future.

There can be no assurance that any patent applications will result in issued patents, that any issued patents will provide meaningful protection, that our claims will be broad enough to prevent competitors from developing competing technologies, that our intellectual property will not be challenged, designed around, invalidated or circumvented, or that we will be able to enforce our rights cost-effectively. We also may rely on trade secrets, know-how, confidentiality obligations and other non-patent protections that may be difficult to protect or enforce. If we are unable to develop, obtain, protect or enforce intellectual property or proprietary know-how that is important to our business, our competitive position, commercialization strategy, ability to partner with customers or strategic parties and long-term prospects could be adversely affected.

Other licenses that may be necessary for some of our proposed downstream processing steps have not yet been obtained. Any failure to establish or maintain collaborative, joint venture or licensing arrangements for the production of boron or other specialty products on favorable terms could adversely affect our business and prospects.

Third parties may claim that we infringe on their proprietary intellectual property rights, and resulting litigation may be costly and could prevent or delay our development activities.

Our commercial success will depend in part on not infringing, misappropriating or violating the intellectual property rights of others. From time to time, we may be subject to legal proceedings and claims, including claims of alleged infringement of trademarks, copyrights, patents and other intellectual property rights held by third parties. In the future, third parties may sue us for alleged infringement of their proprietary or intellectual property rights. We may not be aware of whether our products do or will infringe existing or future patents or the intellectual property rights of others. Any litigation in this regard, regardless of outcome or merit, could result in substantial costs and diversion of management and technical resources as well as harm to our brand, any of which could adversely affect our business, financial condition and results of operations. If the party claiming infringement were to prevail, we could be forced to discontinue the use of the related technology or design and/or pay significant damages unless we enter into royalty or licensing arrangements with the prevailing party or are able to redesign our products or processes to avoid infringement. Any such license may not be available on reasonable terms, if at all, and there can be no assurance that we would be able to redesign our products or processes in a way that would not infringe the intellectual property rights of others. In addition, any payments we are required to make and any injunction we are required to comply with as a result of such infringement could harm our reputation and financial results. In addition, as we seek to protect and commercialize proprietary technologies, including in-situ extraction, closed-loop processing, wellfield designs, product processing and advanced boron materials, competitors or other third parties may assert that our processes, equipment, products, know-how or patent applications infringe or otherwise violate their intellectual property rights. Any such claims, whether or not meritorious, could require us to incur substantial legal costs, divert management attention, delay development, require changes to our processes or products, require licenses that may not be available on acceptable terms or at all, or otherwise adversely affect our business.

All of our business activities are now in the development-stage, but there can be no assurance that our development efforts will result in commercial development.

All of our operations are at the development-stage and there is no guarantee that any such activity will result in commercial production. Although a certain amount of drilling has been conducted at the Project to date, the evaluation of the final mine plan is not yet complete. Significant additional drilling and mine design activities could be required to develop the Project.

The exploration and development of boron and other byproducts involves significant risks which even a combination of careful evaluation, experience and knowledge cannot eliminate. While the discovery of these minerals may result in substantial rewards, few properties which are explored are ultimately developed into producing mines. Major expenses may be required to establish and develop proven and probable mineral reserves, to develop processes and to construct mining and processing facilities at a particular site, including at the Project. It is impossible to ensure that the exploration and development programs planned by us or any future development programs will result in a profitable commercial mining operation. There is no assurance that our mineral exploration and development activities will result in any discoveries of commercial quantities of boron, lithium, or any other materials or byproducts. There is also no assurance that any mineral property will be brought into commercial production. Whether a mineral deposit will be commercially viable depends on a number of factors, some of which are: the particular attributes of the deposit, such as size, grade and proximity to infrastructure, the run of mine solution produced, engineering of the plant and process to produce a commercial product, prices of minerals and the volatility of their respective markets; raw material input prices and the related volatility thereof, and government regulations, including regulations relating to prices, taxes, royalties, land tenure, land use, importing and exporting of minerals and environmental protection. These factors and others are beyond our control, and the effects of these factors cannot be accurately predicted. Our long-term profitability will be in part related to the cost and success of our proposed exploration and development programs and any subsequent development programs at the Project and elsewhere.

We are a development-stage company and our estimates of mineral resources and reserves remain inherently uncertain and subject to significant change, and the actual volume and grade of material actually recovered may differ materially from current estimates.

During August 2025, we advanced our Project from the exploration stage by filing a Preliminary Feasibility Study, resulting in the conversion of certain measured and indicated resources into proven and probable reserves for boric acid. An updated PFS and technical report summary is included as an exhibit to this Annual Report. Despite this advancement, there remains considerable uncertainty in our resource and reserve estimates due to the inherent risks and subjective judgments involved in such assessments. Investors should not assume that the mineral reserve and resource estimates described under “Properties–Mineral Resource Estimate” and “Properties–Mineral Reserve Estimate” will be fully or economically extracted.

Mineral resources are not mineral reserves and have not demonstrated economic viability. Measured and indicated mineral resources may never be converted into mineral reserves, and inferred mineral resources have a lower level of geological confidence and may not be considered in assessing economic viability under Regulation S-K 1300. Mineral reserves depend on numerous modifying factors, including pricing, recovery, costs, permitting, infrastructure, market demand, taxes, royalties, inflation, financing, metallurgical performance, wellfield design, environmental requirements and other assumptions, any of which may prove inaccurate or change over time.

The Project deposit has had a significant amount of prior drilling and has been the subject of multiple prior mineral resource estimates, including a 2018 initial feasibility study prepared for ABR according to the Joint Ore Reserves Committee (the “JORC Code”), a second feasibility study originally released in April 2020 and updated further in February 2021 also prepared for ABR in accordance with the JORC Code, and an amended initial assessment report released by us in May 2023 and further revised in February 2024. None of the prior ABR mineral resource estimates were Regulation S-K 1300 compliant, and such prior estimates resulted in different mineral resource estimates. Investors should not rely on such historic estimates as current estimates under Regulation S-K 1300. Our current Regulation S-K 1300 disclosure is based on the PFS released by us in August 2025 and the updated PFS and technical report summary, with an effective date of June 30, 2026, included as Exhibit 96.1 to this Annual Report. Additional time and expenditures are required to commercially mine and to construct, complete and install mining and processing facilities for properties that are actually mined and developed. Any expenditure that we may make in the development of refined borates and advanced boron materials may not result in the discovery of commercially exploitable mineral deposits or such advanced boron materials.

The mineral reserve estimates stated in this filing and extracted from the PFS or updated technical report summary represent the amount of boric acid that the qualified persons in that report estimated could be economically and legally extracted or produced at the time of the mineral reserve determination. Such estimates and related PFS assumptions are based on qualified-person judgments and are not guarantees of actual production, recoveries, mine life, profitability, commercial feasibility or economic extraction. Any material reductions in the quantity of mineral reserves or resources, related grades, recovery rates, prices, market assumptions or increases in cost of production could have a material adverse effect on our business, financial condition or prospects.

Future FEL-3 work, technical studies, market studies, updated reserve or resource estimates, permitting requirements, financing requirements or other work could result in materially different project economics, higher costs, longer timelines, reduced reserves or resources, impairment of assets or a decision not to proceed with some or all of the Project as currently contemplated.

Estimates relating to the development of the Project, the PFS, the updated technical report summary and the mine plan are uncertain and we may incur higher costs and lower economic returns than estimated.

The PFS and any updated technical report summary are not final feasibility studies and remain subject to further engineering, design refinement, technical validation, permitting, financing, market studies, cost estimation and commercial development work and we may incur higher costs and lower economic returns than estimated. The PFS, updated technical report summary, mine plan, reserves, capital costs, operating costs, production profile, recoveries, pricing assumptions, co-product assumptions, schedule and other assumptions may change as FEL-3 engineering and related work progresses.

Estimates relating to the development of the Project and mine plan are uncertain, including estimates related to capital expenditures, operating costs, wellfield design, horizontal wells, injection and recovery configurations, recovery rates, processing requirements, energy infrastructure, natural gas supply, evaporation ponds, co-products, labor, logistics, permitting, financing costs and the timing of commercial production. We are now targeting initial commercial production in 2030, but this target may not be achieved and is contingent upon progressing through FEED engineering by January 2027 and securing the necessary financing to commence construction in January 2028. Delays may result from financing, engineering, permitting, procurement, construction, commissioning, technical validation, customer qualification, offtake, market conditions, supply-chain constraints, labor availability, litigation, regulatory changes or other factors.

In addition, the Project is based on in-situ leaching and chemical processing at a scale that we have not previously achieved. The ultimate commercial wellfield design, use of horizontal wells, recovery rates, solution chemistry, scaling, impurity management, acid consumption, evaporation and crystallization performance and commercial-scale processing results may differ materially from our current expectations, including those based on the SSF, historical pilot operations, step-rate testing, customer samples or other technical work. If our assumptions prove inaccurate, or if future technical studies or commercial-scale operations produce results that differ from expectations, we may be required to redesign portions of the Project, incur additional costs, delay development, reduce expected production, revise reserve or resource estimates or determine not to proceed with the Project as currently contemplated.

Further, because the PFS capital estimate and Project economics depend on assumptions that may change, investors should not place undue reliance on such estimates as guarantees of future results. Actual costs, revenues, cash flows, returns, production volumes, recoveries, mine life and schedule could differ materially from current estimates and could adversely affect our business, financial condition and prospects.

The actual profitability or economic feasibility of the Project may differ from our estimates as a result of any of the following risks normally encountered in the mining industry, such as:

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changes in tonnage, grades, metallurgical characteristics, recovery rates, solution chemistry or other technical assumptions;

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changes in input commodity, labor, equipment, water, power, natural gas, reagent, construction, logistics or financing costs;

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the quality of the data on which engineering, mine plan, processing, recovery, wellfield and economic assumptions are made;

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adverse geological, geotechnical, hydrological, wellfield, processing or operating conditions;

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availability of adequate and skilled labor, machinery, equipment, long-lead items, infrastructure, water, power and natural gas;

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inflation, tariffs, taxes, royalties, interest rates, trade policies, regulatory changes or changes in financing availability or terms;

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delays in obtaining environmental, land-use or other government permits, approvals, amendments or authorizations;

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weather, severe climate impacts, accidental fires, floods, drought, wildfires, earthquakes or other natural disasters;

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water management, pollution, environmental damage or harm to plants or animals, including endangered or protected species;

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health and safety issues, pandemics or infectious diseases;

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social and community issues, labor disputes, protests, road blockages, work stoppages or challenges to permits or mining activities;

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uncertainties regarding our ability to successfully implement downstream processing and reach full revenue potential; and

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other known and unknown risks involved in the conduct of exploration, development, construction and operation of mines.

Any of the aforementioned risks may cause substantial delays to the Project and require significant capital outlays, adversely affecting our future earnings and competitive position and, potentially, our financial viability. In addition, the nature of some of these risks is such that liabilities could exceed any applicable insurance policy limits or could be excluded from coverage. As many of the risks described above are also risks against which we cannot insure or against which we may elect not to obtain insurance, we are not fully insured against all potential risks incident to our business. The potential costs which could be associated with any liabilities not covered by insurance, or in excess of insurance coverage, or compliance with applicable laws and regulations could be substantial. As a result of market conditions, certain insurance may become unavailable or available only for reduced amounts of coverage. If we were to incur a significant loss for which we were not fully insured, it could have a material adverse effect on our business, results of operations, financial condition and liquidity.

Our growth depends upon demand for borates, lithium, calcium chloride, gypsum and related products in the markets we seek to serve, and such demand may not develop as we expect.

Our growth is dependent upon the development of demand for borates, advanced boron materials, lithium, calcium chloride, gypsum and related products across diverse end markets, including industrial, specialty glass, insulation, agriculture, defense, energy, infrastructure, technology, automotive and other markets. If the market for such applications does not develop as we expect, develops more slowly than we expect, or current boron producers or other competitors fulfill all or a portion of the market’s anticipated needs, our business, prospects, financial condition and results of operations may be adversely affected.

Demand for our potential products could be affected by numerous external factors, including customer specifications, substitution by alternative materials, technological changes, government regulations and incentives, trade policies, customer adoption, capital investment cycles, macroeconomic conditions, end-market growth rates, competitive pricing, geopolitical conditions and the ability of incumbent producers to respond to new supply.

Our long-term success will depend on our ability to convert customer qualification and non-binding commercial arrangements into definitive, bankable offtake agreements and to deliver product under those agreements.

Because we have not yet begun commercial-scale production of mineral products, we currently do not have any fully binding long-term supply or offtake agreements with customers. We have, and may continue to enter into heads of agreement, letters of intent, memoranda of understanding, purchase orders, trial shipment arrangements, qualification arrangements or other commercial arrangements with potential customers, but these arrangements may be non-binding, conditional or otherwise subject to further negotiation and may not result in definitive offtake agreements, revenue, pricing, margins, minimum volumes or financing support.

We expect certain commercial heads of agreement to include important commercial terms, including potential products, volumes, specifications, pricing mechanisms, delivery periods and other matters, but they are expected to be subject to conditions, including achieving project financing. These arrangements may also be subject to further negotiation, modification or replacement, including based on lender, underwriter, strategic investor or other financing-source feedback. If the terms of such arrangements are not viewed as bankable or otherwise sufficient to support financing, we may need to renegotiate such terms, seek different commercial arrangements or pursue other financing strategies, any of which could delay or adversely affect our business plan.

Customer qualification is an important step toward commercialization, but successful qualification of boric acid or other products produced from the SSF does not guarantee that any customer will enter into a binding offtake agreement, purchase product in commercial quantities, accept commercial-scale production, agree to favorable pricing or provide financing support. Customers may require additional testing, validation or requalification of products produced at commercial scale, even if they have qualified SSF-produced products, and such additional qualification may delay or reduce expected sales.

Potential definitive offtake agreements may contain fixed pricing, formula-based pricing, index-linked pricing, inflation-adjusted pricing, price collars, floors, ceilings, volume commitments, quality specifications, delivery obligations, termination rights, force majeure provisions, penalties, financing conditions or other terms that could reduce expected economics, increase operational risk or limit our flexibility. If we are unable to enter into definitive offtake agreements on acceptable terms, or if we are unable to deliver product under such agreements after they are executed, our business, results of operations, ability to obtain financing and financial condition could be materially and adversely affected.

If the estimates and assumptions we use to determine market demand, market size and pricing are inaccurate, our future growth rate and Project economics may not be accurate or may be adversely affected.

Our estimate of the annual total addressable market and long-term pricing for our proposed products is based on internal and third-party estimates, which are based on factors including historical and current global demand and pricing, the number and geographic location of suppliers, supplier capacity, customer specifications, end-use applications, published pricing indices, market studies and assumptions regarding future demand growth. Market estimates and growth forecasts are subject to significant uncertainty and are based on assumptions and estimates that may prove to be inaccurate.

Boric acid and many borate products are not exchange-traded commodities, and third-party published pricing indices and market studies may not fully reflect realized pricing, contract-specific terms, customer specifications, regional dynamics, freight, logistics, product quality, price floors or ceilings, inflation adjustments, customer concentration or long-term market conditions. If the price, demand, market size, growth trajectory or marketability of boric acid, calcium chloride, gypsum, lithium or other potential products differs from our expectations, our ability to obtain financing, enter into offtake agreements, support reserves, achieve expected Project economics or develop our business could be adversely affected.

We currently depend on a single mining project.

The Project currently accounts for all of our mineral resources and reserves and, without the Assets expected to be acquired from SVM, the current potential for the future generation of revenue. Any adverse development affecting the Project will have a material adverse effect on our business, prospects, profitability, financial performance and results of operations. These developments include, but are not limited to, the inability to obtain necessary permits or financing to develop the Project, changes in technical parameters of project development, changes in costs or anticipated costs which may make it uneconomic to develop and/or operate the Project, unusual and unexpected geologic formations, seismic activity, rock bursts, flooding, drought, and other conditions involved in the drilling and removal of material, any of which could result in damage to, or destruction of, property, and which could hinder the development and future operation of the Project. If the Project is completed to management’s contemplated target production capacity of up to 450,000 tons per year of boric acid, it will exceed the limits of our existing permits, which would require us to seek modifications to the permits. There can be no assurance that we could obtain any required permit modifications. Based on the Preliminary Feasibility Report, and assuming we reach economically viable production, the Project, by its nature, will have a defined production life (the period during which extraction will remain viable). Ultimately, we will be required to replace and expand our resources and any established reserves if we are to maintain operating revenues. In the absence of additional mineral projects, we will be solely dependent on the Project for our revenue and profits, if any. Our ability to maintain or increase our annual production will be dependent, in significant part, on our ability to expand the Project, bring new projects into production and to complete acquisitions.

Our long-term success will depend ultimately on our ability to achieve and maintain profitability and to develop positive cash flow from our proposed operating activities.

Our long-term success, including the recoverability of the carrying values of our assets, our ability to acquire and develop additional projects, and continuing with the exploration, development and commissioning and operating activities of the Project will depend ultimately on our ability to achieve and maintain profitability and to develop positive cash flow from our operations by establishing ore bodies that contain commercially recoverable borates, lithium, and other minerals and to develop these into profitable operating activities. The economic viability of our future operating activities has many risks and uncertainties including, but not limited to:

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a significant, prolonged decrease in the market price of borates, lithium, gypsum, calcium chloride and other minerals;

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difficulty in marketing and/or selling borates, lithium, gypsum, calcium chloride and other minerals;

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significantly higher than expected capital costs to construct the Project;

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significantly higher than expected extraction costs;

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significantly lower than expected borates, lithium, and other minerals extraction;

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significant delays, reductions or stoppages of borates, lithium, and other minerals extraction activities;

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the introduction of significantly more stringent regulation affecting our activities; and

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global political, economic and market conditions, including political disturbances, war, terrorist attacks and changes in global trade policies and tariffs.

Our future operating activities may change as a result of any one or more of these risks and uncertainties, and we cannot assure you that any ore body that we extract mineralized materials from will result in achieving and maintaining profitability and developing positive cash flow.

The cost and availability of electricity, natural gas and other energy resources are subject to volatile market conditions and infrastructure constraints.

Mining development projects and operations consume large amounts of raw materials and energy. We may rely on third parties for the supply of energy we consume and will consume in our development and mining activities. The prices for and availability of electricity, natural gas, oil and other energy resources are subject to worldwide supply and demand, volatile market conditions, weather conditions, geopolitical events, regulatory actions and other factors beyond our control. Variations in the cost or availability of raw materials and energy may significantly affect our operating results and Project economics.

The Phase 1 plan currently contemplates a natural gas combined heat and power or cogeneration facility rather than reliance on a Southern California Edison interconnection for commercial-scale power. If we proceed with such a facility, we will be dependent on natural gas supply, pipeline connection, construction, permitting, equipment procurement, commissioning, emissions compliance, operating performance and long-term energy costs. Growing demand for on-site power generation driven by the rapid expansion of artificial intelligence and other data center activity could significantly increase the cost and reduce the availability of the cogeneration equipment we anticipate procuring for such a facility. Any inability to secure reliable and cost-effective energy, complete required energy infrastructure, operate the cogeneration facility as expected, or manage energy-related permitting or emissions obligations could delay or increase the cost of developing and operating the Project.

Inadequate infrastructure may constrain our future mining operations, including at the Project.

Any potential commercial production at the Project will depend on adequate infrastructure. In particular, reliable power sources, natural gas supply, water supply, transportation, surface facilities, evaporation ponds, communications, security, construction staging, logistics and other infrastructure are necessary to develop and operate the Project. Failure to adequately meet these infrastructure requirements or changes in the cost, availability, design or schedule of such inputs could affect our ability to develop or commence production at the Project and could have a material adverse effect on our business, financial condition, results of operations, cash flows or prospects.

Uncertain global economic conditions could have a material adverse effect on our business, financial condition, results of operations or prospects, including the pricing of our products.

Our financial results are tied to global economic conditions and their impact on levels of consumer confidence and consumer spending. Global consumer markets can be impacted by significant U.S. and international economic downturns and inflation, such as the economic contraction caused by the coronavirus pandemic of 2020 and the global credit crunch experienced in 2008, as well as global hostilities and conflict, including in Ukraine and Russia, as well as the Middle East. High levels of inflation, recession or a weak recovery, due to factors that include, but are not limited to, disruptions in financial markets, federal budget, tax, tariff or trade policy issues in the United States, political upheavals, war or unrest, economic sanctions against trading nations, and demonetization, could cause us to experience significant cost increases and revenue declines due to deteriorated consumer confidence and spending, and a decrease in the availability of credit or on commercially acceptable terms, which could have a material adverse effect on our business prospects or financial condition.

Our business is also dependent upon certain industries, such as energy, automotive, agriculture, transportation, petrochemical and original equipment manufacturing, and these are also cyclical in nature. Therefore, these industries may experience their own significant fluctuations in demand for our products based on such things as economic conditions, energy prices, consumer demand and infrastructure funding decisions by governments. Many of these factors are beyond our control. As a result of the volatility in the industries we plan to serve, we may ultimately have difficulty increasing or maintaining our level of sales or profitability. If the industries we serve were to suffer a downturn, then our business may be adversely affected.

Prices and availability of commodities consumed or used in connection with exploration and development and mining, such as natural gas, diesel, oil and electricity, also fluctuate, and these fluctuations have and could in the future affect the costs of operations. These fluctuations can be unpredictable, can occur over short periods of time and may have a material adverse impact on our operating costs or the timing and costs of various projects.

Our business could be affected by macroeconomic risks.

Our operations and performance depend significantly on global and regional economic conditions. Macroeconomic conditions, including inflation, slower growth or recession, changes to fiscal and monetary policy, tighter credit, higher interest rates, high unemployment and currency fluctuations can materially adversely affect demand for our products. In addition, confidence and spending can be materially and adversely affected in response to financial market volatility, negative financial news, declines in income or asset values, energy shortages and cost increases, labor and healthcare costs and other economic factors. An adverse impact on demand for our products, uncertainty about, or a decline in, global or regional economic conditions can have a significant impact on our suppliers and other partners. Potential effects include financial instability; inability to obtain credit to finance operations and purchases of our products; and insolvency. We cannot predict the timing or scale of these various macroeconomic conditions, but they could have a material adverse effect on our business, results of operations and financial condition.

Government efforts to combat inflation, along with other interest rate pressures, may lead to increased financing costs and Project completion costs.

Over the past several years, global and U.S. levels of monetary inflation have been higher than recent historical averages. Government entities have taken various actions to combat inflation, such as raising interest rate benchmarks. Government entities may continue their efforts, or implement additional efforts, to combat inflation, which could include among other things continuing to raise interest rate benchmarks or maintaining interest rate benchmarks at elevated levels. Such government efforts, along with other interest rate pressures arising from an inflationary economic environment, could lead to higher financing costs and have a material adverse effect on our business, financial condition and results of operations.

We are subject to anti-bribery, anti-corruption, and anti-money laundering laws, including the U.S. Foreign Corrupt Practices Act, as well as export control laws, customs laws, sanctions laws and other laws governing our operations. If we fail to comply with these laws, we could be subject to civil or criminal penalties, other remedial measures and legal expenses, which could adversely affect our business, results of operations and financial condition.

The U.S. Departments of Justice, Commerce, State and Treasury and other federal agencies and authorities have a broad range of civil and criminal penalties they may seek to impose against corporations and individuals for violations of economic sanctions laws, export control laws, the U.S. Foreign Corrupt Practices Act (the “FCPA”), and other federal statutes and regulations, including those established by the Office of Foreign Assets Control (“OFAC”). Under these laws and regulations, as well as other anti-corruption laws, anti-money laundering laws, export control laws, customs laws, sanctions laws and other laws governing our operations, various government agencies may require export licenses, may seek to impose modifications to business practices, including cessation of business activities in sanctioned countries or with sanctioned persons or entities and modifications to compliance programs, which may increase compliance costs, and may subject us to fines, penalties and other sanctions. A violation of these laws or regulations would negatively affect our business, financial condition and results of operations.

We are continuing to implement policies and procedures designed to facilitate compliance by us and our directors, officers, employees, representatives, consultants and agents with the FCPA, OFAC restrictions and other export control, anti-corruption, anti-money-laundering and anti-terrorism laws and regulations. We cannot assure you, however, that our policies and procedures are or will be sufficient or that directors, officers, employees, representatives, consultants and agents have not engaged and will not engage in conduct for which we may be held responsible, nor can we assure you that our business partners have not engaged and will not engage in conduct that could materially affect their ability to perform their contractual obligations to us or even result in our being held liable for such conduct. Violations of the FCPA, OFAC restrictions or other export control, anti-corruption, anti-money laundering and anti-terrorism laws or regulations may result in severe criminal or civil sanctions, and we may be subject to other liabilities, which could have a material adverse effect on our business, financial condition and results of operations.

Title to mineral properties and related water rights is a complex process and we may suffer a material adverse effect in the event the Project property or other properties that we may acquire are determined to have title deficiencies.

Acquisition of title to mineral properties and related water rights is a very detailed and time-consuming process. Title to, and the area of, mineral properties may be disputed. We cannot give any assurance that title to such property will not be challenged or impugned. Mineral properties sometimes contain claims or transfer histories that examiners cannot verify. A successful claim that we do not have title to the Project property or lack appropriate water rights could cause us to lose any rights to explore, develop and mine any minerals on that property, without compensation for our prior expenditures relating to such property.

Challenges to our mining claims could adversely affect our operations and financial condition.

Certain of our mining activities depend upon the validity and enforceability of mining claims, including unpatented mining claims, which are subject to potential challenges from third parties, regulatory bodies, or governmental agencies. Such challenges may include assertions that:

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A mining claim is invalid due to improper staking, inaccurate or incomplete documentation, or non-compliance with applicable laws and regulations.

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A mining claim lacks proper tenure, ownership, or rights due to disputed title or conflicting ownership claims.

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The type of mining claim (e.g., lode versus placer) has been incorrectly characterized, which may impact our rights to extract minerals.

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The boundaries or location of a mining claim have been incorrectly established or recorded.

If any of our mining claims are successfully challenged, we may lose rights to some or all of the mineral deposits within those claims. The resolution of any such challenges, whether through litigation or administrative procedures, can be costly, time-consuming, and uncertain. An adverse determination could require us to modify or terminate our mining activities on the affected properties, incur substantial costs to rectify deficiencies, or significantly delay our mining plans. Such outcomes could materially and adversely affect our operations, financial condition, and results of operations.

Restrictions on our ability to obtain, recycle and dispose of water may impact our ability to execute our development plans and proposed operations.

Water is an essential component of our planned mining processes. We currently have two water production wells in an aquifer within our permit boundary, but water is limited in the Mojave Desert. If our demand for water were to outpace supply, our ability to perform mining operations could be restricted or made more costly. Along with the risks of other extreme weather events, drought risk, in particular, is likely increased by climate change. If we are unable to obtain sufficient water to use in our operations, we may be unable to economically produce our target minerals, which could have an adverse effect on our financial condition, results of operations and cash flows. In addition, commercial development of the Project may depend on our ability to design, permit, construct and operate evaporation ponds, solution management systems, recycling systems and related facilities for sodium and calcium removal, brine or process solution management, monitoring and closure. Changes in pond sizing, liner requirements, waste discharge requirements, monitoring obligations, closure obligations or water-board requirements could increase costs, delay development or constrain operations.

The development, construction and proposed operation of our properties and projects is subject to various environmental, operational and land-use regulations that could adversely affect our ability to grow.

Our properties and Project are subject to numerous environmental laws, regulations, guidelines, policies and other requirements relating to, among other things, local land use, zoning, building and operational laws and regulations. Requirements that are in place for mining projects may require conformance with specified generation capacities, sound levels, radar setbacks, as well as restrictions on communications interference, hazards to aviation or navigation, or other potential nuisances.

Although we believe the major permits and approvals required for the Project are currently in place, Phase 1 development and commercial-scale operations may require additional permits, permit amendments, modifications, renewals, authorizations, bonding or agency approvals, including modifications to our EPA permit to address different wellfield designs and the permitted term or period of operations. Regulators may disagree with our interpretation of the scope, timing or nature of required permit modifications or may impose conditions that increase costs or delay development. Any failure to obtain, maintain or comply with such permits, permit modifications or approvals could adversely affect our ability to develop or operate the Project.

Mining projects may experience local opposition in certain markets due to claims based on alleged nuisances, concerns about conversion of land use from agriculture or undeveloped land to mining, or other claims of potential adverse health or environmental impacts, such as misuse of water resources, landscape degradation, land use, food scarcity or price increase. We could experience significant opposition from third parties, including environmental non-governmental organizations, local landowners, neighborhood groups, municipalities and other entities either during the permit application process, including during any public hearings, comment periods or appeal proceedings, or after environmental permits are issued, as well as by governmental regulators if future administrations or regulators become less favorable to our industry. We could also experience renewed opposition if any permit requires amendment.

Any such opposition may be taken into account by government officials responsible for granting the relevant permits, which could result in the permits being delayed, not being granted or being granted solely on the condition that we carry out certain corrective measures to our proposed projects (including at the Project), which could materially increase our operational costs. In addition, we may become subject to legal proceedings or claims contesting the construction or operation of our projects or permits required thereunder. Any such delays, permit restrictions, legal proceedings or disputes (even if ultimately decided in our favor) could materially delay our ability to complete construction of a project (including at the Project) in a timely manner, or at all, materially increase the costs associated with commencing or continuing such project’s commercial operations or harm our reputation. Any settlement of claims or unfavorable outcomes or developments relating to these proceedings or disputes, such as judgments for monetary damages, injunctions or denial or revocation of permits, could have a material adverse effect on our business, financial condition, results of operations, and reputation.

The mining industry is historically a cyclical industry and market fluctuations in the prices of borates and other minerals could adversely affect our business.

We may derive revenues from the extraction and sale of borates, calcium-based co-products and other minerals. The marketability of minerals is affected by numerous factors beyond our control. These factors include government regulations relating to pricing, taxes, royalties, allowable production, imports, exports, prevailing price, price volatility, supply, changes in buyer preferences and demand for borates and other minerals. The prices of such commodities have historically fluctuated, and may in the future fluctuate widely and may be affected by numerous factors beyond our control, including international, economic and political trends, domestic and foreign tax policy, the price of imports of commodities, the cost of exploration, development, production and processing mineral ore, available transportation capacity, expectations of inflation, currency exchange fluctuations, interest rates, global or regional consumptive patterns, speculative activities, increased production due to new or improved extraction and production developments and methods, technological changes in the markets for the end products and the overall supply and demand for minerals. The effect of these factors on the price of borates and other minerals, and therefore the economic viability of any of our exploration properties, cannot accurately be predicted. Additionally, new production of borates from current or new competitors in the borates market could adversely affect prices. Any additional supply (including as a result of new investments) could have an adverse effect on the price of such materials. Only limited information is available with respect to the status of expansion and new borate production capacity expansion projects being developed by current and potential competitors, and, as such, we cannot make accurate projections regarding the future capacities of current and possible new entrants into the market and the dates on which such capacities could become available on the market. If these potential projects are completed in the short term, they could adversely affect market prices for borates and lithium, thereby resulting in a material adverse effect on the economic feasibility of extracting any minerals we discover.

Changes in commodity prices would affect our revenues and may reduce the amount of funds available to reinvest in development activities. Reductions in mineral prices not only reduce our revenues and profits but could also reduce the quantities of any reserves that are commercially recoverable. Declining mineral prices may also adversely impact our operations by requiring a review of the commercial feasibility of any of our proposed exploration and development programs. Any such review may indicate a material adverse effect on the economic feasibility of our proposed business.

Fluctuations in the value of the United States dollar relative to other currencies may adversely affect our business.

Because we anticipate that a portion of our future product sales may be to customers outside the United States, a strong U.S. dollar could negatively impact our export competitiveness by making our products more expensive for foreign buyers, thereby potentially reducing our anticipated international sales. A strong U.S. dollar could also make imported borate products comparatively less expensive, potentially increasing competition from foreign producers importing into the U.S. market. Conversely, a weak U.S. dollar may enhance our export competitiveness by making our products relatively less expensive in foreign markets and may make imported products comparatively more expensive, reducing competition from foreign imports; however, because we expect to source a portion of our equipment, materials and services from outside the United States, a weak U.S. dollar could also increase the cost of those imported inputs and our capital costs. These currency fluctuations, whether strengthening or weakening the U.S. dollar, introduce volatility and uncertainty in our anticipated pricing, sales, costs, profitability, and overall competitive position in both domestic and international markets.

We face risks relating to mining, exploration, development and mine construction on our properties.

Our level of profitability, if any, in future years will depend to a great degree on borate prices and whether our properties can be brought into production. Exploration and development of borate resources are highly speculative in nature, and it is impossible to ensure that the currently proposed and future exploration programs and/or feasibility studies on our existing properties will fully monetize the reserves. Whether it will be economically feasible to extract boron depends on a number of factors, including, but not limited to: the particular attributes of the deposit, such as size, grade and proximity to infrastructure; boron prices and volatility of the market; mining, processing and transportation costs; the willingness of lenders and investors to provide project financing on commercially reasonable or favorable terms; labor costs and possible labor strikes; and governmental regulations, including, without limitation, regulations relating to prices, taxes, royalties, land tenure, land use, importing and exporting materials, foreign exchange, environmental protection, employment, worker safety, transportation, and reclamation and closure obligations. The effect of these factors cannot be accurately predicted, but any one or a combination of these factors may result in us receiving an inadequate return on invested capital. In addition, we are subject to the risks normally encountered in the mining industry, such as:

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accidental fires, floods, earthquakes, severe weather or other natural disasters;

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unplanned power outages and water shortages;

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construction delays and higher than expected capital costs due to, among other things, supply chain disruptions, higher transportation costs and inflation;

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controlling water and other similar mining hazards;

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explosions and mechanical failure of equipment;

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operating labor disruptions and labor disputes;

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our liability for pollution or other hazards; and

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other unknown risks involved in the conduct of exploration and operation of mines.

The nature of these risks is such that liabilities could exceed any applicable insurance policy limits or could be excluded from coverage. There are also risks against which we cannot insure or against which we may elect not to insure. The potential costs, which could be associated with any liabilities not covered by insurance or in excess of insurance coverage, or compliance with applicable laws and regulations may cause substantial delays and require significant capital outlays, adversely affecting our future earnings and competitive position and potentially our financial viability.

Mineral exploration and development, such as our proposed operations, are subject to extraordinary risks.

Mineral exploration, development and production involves many risks which even a combination of experience, knowledge and careful evaluation may not be able to overcome. The industrial activities conducted at our facilities present significant risk of serious injury or death to our employees, customers or other visitors to our operations, notwithstanding our safety precautions, including our material compliance with federal, state and local employee health and safety regulations. While we have in place policies and procedures to minimize such risks, we may nevertheless be unable to avoid material liabilities for an injury or death. Our operations will be subject to geological, technical and operating hazards and risks inherent in the exploration for mineral resources and, if we discover a mineral resource in commercially exploitable quantity, our operations could be subject to all of the hazards and risks inherent in the development and production of resources, including liability for pollution or similar hazards against which we cannot insure or against which we may elect not to insure. Any such event could result in work stoppages and damage to property, including damage to the environment. Even though we maintain workers’ compensation insurance and a general liability policy to address the risk of incurring material liabilities for injury or death, there can be no assurance that the insurance coverage will be adequate or will continue to be available on the terms acceptable to us, or at all, which could result in material liabilities for an injury or death. The payment of any liabilities that arise may have a material adverse impact on us.

Our proposed facilities or operations could be adversely affected by natural or human causes outside of our control, such as natural disasters, wars or health epidemics or pandemics.

We may be impacted by natural disasters, wars, health epidemics or pandemics, terrorist attacks, civil unrest, cyber threats or attacks, or other events outside of our control. For example, the Project is located in San Bernardino County, California near active faults, which may make our operations more susceptible to nearby earthquakes. If major disasters such as earthquakes, wildfires, health epidemics or pandemics, floods, drought, or other events occur, or our information system or communications network breaks down or operates improperly, our ability to achieve or continue operations at the Project may be seriously damaged, or we may have to stop or delay our proposed exploration and development, and eventually production and shipment of our products. We may incur expenses or delays relating to such events outside of our control, which could have a material adverse impact on our business, operating results and financial condition.

A shortage of skilled technicians and engineers may further increase our operating costs, which may materially adversely affect our results of operations.

Efficient production of borate products using modern techniques and equipment requires skilled technicians and engineers. In addition, our efforts will significantly increase the number of skilled operators, maintenance technicians, engineers and other personnel required to successfully operate our business. In the event that we are unable to hire, train and retain the necessary number of skilled technicians, engineers and other personnel there could be an adverse impact on our labor costs and our ability to reach anticipated production levels in a timely manner, which could have a material adverse effect on our results of operations.

Changes in U.S. trade policies, including the imposition of tariffs, could materially increase the cost of constructing or operating the Project.

Our planned Commercial-Scale Facility for in-situ mining of boron will require significant capital investment, currently estimated to be approximately $435 million, inclusive of contingency. The construction of this facility will involve sourcing equipment from within the United States, but also from various European countries and other international sources. Recent and potential future changes in U.S. trade policies, including tariffs implemented or proposed by the U.S. government and any retaliatory actions taken in response by foreign governments, could significantly increase the cost of imported equipment and materials required for the construction of our facility.

The economic analysis included in our Preliminary Feasibility Study, and the related cost analyses, have not accounted for the impact of existing or future tariffs. The ultimate impact of currently announced tariffs and any future tariffs or trade policies will depend on various factors, including the timing of implementation and the amount, scope and nature of such tariffs or policies. Given the uncertainty and volatility surrounding trade and tariff policies, particularly in light of historical shifts in tariff approaches, including those imposed under the current U.S. administration, we may experience materially increased costs that are difficult to predict accurately at this time. Such cost increases could negatively affect the projected economics of our facility and our ability to access financing, potentially causing the economic feasibility of the project to deteriorate substantially or render the project economically unviable, thereby causing us to delay, significantly modify, or cancel the project entirely, which would have a material adverse effect on our business, financial condition, results of operations, and prospects.

A shortage of equipment or disruption in our supply chain could adversely affect our ability to develop, construct or operate our business.

Our ability to develop, construct and operate the Project will depend on the availability, timing, cost, quality and performance of equipment, materials and services, including long-lead or specialized equipment such as crystallizers, cogeneration equipment, pumps, wellfield materials, electrical components, processing equipment, steel, acid and reagents, construction materials and engineering and construction services. Shortages, delays, quality issues, cost increases, vendor failures, logistics constraints, tariffs, geopolitical events or other supply-chain disruptions could increase costs, delay FEL-3, construction or commissioning, require design changes, or otherwise adversely affect our business. In particular, growing demand for on-site power generation driven by the rapid expansion of artificial intelligence and other data center activity could significantly increase the cost, and reduce the availability, of the cogeneration equipment we anticipate procuring for the Project, which could materially increase our capital costs or delay the development and construction of the Project.

Further, we are subject to risk from fluctuating market prices of certain raw materials, including steel, concrete, fiberglass reinforced plastic, and bulk chemicals, among others, which are necessary for the construction, maintenance and operation of our assets. The price of these raw materials may be affected by supply restrictions or other market factors (including inflation) from time to time. Some of the components and materials related to our current and planned assets will be sourced from outside the United States through arrangements with various vendors, and we may experience delays in obtaining these components and materials as a result of shipping and transportation constraints, and other supply chain disruptions. Political, social or economic instability in regions where these components and materials are made could cause future disruptions in trade.

Actions in various countries have created uncertainty with respect to tariff impacts on the costs of some of these components and materials. The degree of our exposure is dependent on (among other things) the type of some of these components and materials. Significant price increases for these raw materials could reduce our operating margins, and could harm our business, financial condition, and results of operations.

In particular, bulk chemicals are critical to the operation of our business. These raw materials are in high demand, subject to price fluctuations and of limited availability. If manufacturers are not able to manufacture or procure enough of these components or manufacture and procure them in a timely manner, this would have a material adverse effect on the development of our products and in turn, our business, financial conditions and results of operations. Significant price increases for bulk chemicals in particular may have an adverse impact on the economic viability of our proposed development and operating activities.

Disruptions in production at our proposed facilities may have a material adverse impact on our business, results of operations and/or financial condition.

Manufacturing facilities in our industry are subject to planned and unplanned production shutdowns, turnarounds, outages and other disruptions. Any serious disruption at our proposed Commercial-Scale Facility could impair our ability to use our facilities and have a material adverse impact on any future revenues and increase our costs and expenses. Long-term production disruptions may allow competitors to be sought for alternative supply which could further adversely affect our profitability or delay or keep us from reaching commercial development at all.

Unplanned production disruptions may occur for external reasons including natural disasters, weather, disease, strikes, transportation interruption, government regulation, political unrest or terrorism, or internal reasons, such as fire, unplanned maintenance or other manufacturing problems. We may experience delays in construction, equipment procurement, or in completing our proposed Commercial-Scale Facility on time. Any such production disruption could have a material impact on our proposed operations, operating results and financial condition.

Failure by our vendors or our component or raw material suppliers to use legal or ethical business practices and comply with applicable laws and regulations may adversely affect our proposed business.

We do not control our vendors or suppliers or their business partners. Accordingly, we cannot guarantee that they follow legal or ethical business practices, such as fair wage practices and compliance with environmental safety and other local laws. A lack of demonstrated compliance could lead us to seek alternative manufacturers or suppliers, which could increase our costs and result in delayed delivery of components and raw materials, or other disruptions of our operations. Violation of labor or other laws by our manufacturers or suppliers or the divergence of a supplier’s labor or other practices from those generally accepted as ethical in the U.S. or other markets in which we do and expect to do business could also attract negative publicity for us and harm our proposed business.

Competition with and new production of borates and other minerals from current or new competitors in the market could adversely affect our proposed business, financial condition and results of operations.

The borates industry is concentrated and includes large, established and well-funded competitors. Competitors may have substantially greater financial, technical, operational, customer, logistical, marketing and other resources than we do. Existing producers may respond to our development plans or new supply by adjusting prices, increasing output, expanding capacity, changing contract terms, leveraging customer relationships or otherwise competing in ways that make it more difficult for us to obtain financing, enter into offtake agreements, achieve expected pricing or operate the Project economically.

If current or future competitors increase production, lower prices, secure long-term customer commitments, develop substitute products, improve processing technology or otherwise satisfy demand that we expect to serve, our ability to develop the Project, obtain financing, execute offtake agreements, sell product or achieve expected economics could be materially adversely affected.

There is limited information on the status of new production capacity expansion projects being developed by the current and potential competitors and, as such, we cannot make accurate projections regarding the capacities of possible new entrants into the market and the dates on which any new projects could become operational but any significant increase in supply could adversely affect market prices for borates, thereby resulting in a material adverse effect on the economic feasibility of extracting our resources.

Industry consolidation may result in increased competition, which could have a material adverse effect on our proposed business.

Some of our competitors have made or may make acquisitions or enter into partnerships or other strategic relationships to achieve competitive advantages. In addition, new entrants not currently considered competitors may enter our market through acquisitions, partnerships or strategic relationships. We expect industry consolidation to continue and/or increase as demand for critical materials increases. Industry consolidation may result in competitors with more compelling product offerings or greater pricing flexibility than we may have, or business practices that make it more difficult for us to compete effectively, including on the basis of price, sales, technology or supply. These competitive pressures could have a material adverse effect on our proposed business.

We are subject to significant environmental and government regulations and compliance with such regulations requires significant expenditures.

Mining activities in the United States are subject to extensive federal, state, local and foreign laws and regulations governing environmental protection, natural resources, prospecting, development, production, post-closure reclamation, taxes, labor standards and occupational health and safety laws and regulations, including mine safety, toxic substances and other matters. The costs associated with compliance with such laws and regulations are substantial. In addition, changes in such laws and regulations, or more restrictive interpretations of current laws and regulations by governmental authorities, could result in unanticipated capital expenditures, expenses or restrictions on or suspensions of our operations and delays in the development of our properties.

As a current holder of interests in U.S. mineral properties, we may be subject to CERCLA. CERCLA, along with analogous statutes in certain states, imposes strict, joint and several liability on owners and operators of facilities which release hazardous substances into the environment. CERCLA imposes similar liability upon generators and transporters of hazardous substances disposed of at an off-site facility from which a release has occurred or is threatened. Under CERCLA’s strict joint and several liability provisions, we could potentially be liable for all remedial costs associated with property that we currently or previously owned or operated regardless of whether our activities are the actual cause of the release of hazardous substances. Such liability could include the cost of removal or remediation of the release and damages for injury to the natural resources. Releases from such facilities or from any of our current U.S. properties due to past or current activities could form the basis for liability under CERCLA and its analogs. In addition, off-site disposal of hazardous substances, including hazardous mining wastes, may subject us to CERCLA liability. Our current and prior U.S. properties are not, to our knowledge, currently listed or proposed for listing on the National Priority List and we are not aware of pending or threatened CERCLA litigation which names us as a defendant or concerns any of our current or prior U.S. properties or operations. However, we have not conducted a Phase 1 or similar environmental site assessment on our properties and cannot be certain that we are aware of all current or historical operations at or affecting our properties that could involve contamination. We cannot predict the potential for future CERCLA liability with respect to our U.S. properties, nor can we predict the potential impact or future direction of CERCLA litigation in the area surrounding our properties.

Environmental regulations, including climate change related legislation or regulations, mandate, among other things, the maintenance of air and water quality standards, land development and land reclamation, and set forth limitations on the generation, transportation, storage and disposal of solid and hazardous waste. Enhanced public and private focus on climate change, greenhouse effects and proposed or contemplated laws and regulations relating to carbon emissions may impact aspects of our development plans or our future production. Environmental legislation is evolving in a manner that may require stricter standards and enforcement, increased fines and penalties for non-compliance, more stringent environmental assessments of proposed projects, and a heightened degree of responsibility for mining companies and their officers, directors and employees. In connection with our current activities or in connection with our prior operating activities, we may incur environmental costs that could have a material adverse effect on financial condition and results of operations. Any failure to remedy an environmental problem could require us to suspend operations or enter into interim compliance measures pending completion of the required remedy.

We may also incur substantial costs, including fines, damages, criminal or civil sanctions and remediation costs, or experience interruptions in our operations, for violations arising under these laws and regulations or permit requirements. If we violate environmental, health and safety laws or regulations, in addition to being required to correct such violations, we can be held liable in administrative, civil or criminal proceedings for substantial fines and other sanctions could be imposed that could disrupt or limit our operations. Liabilities associated with the investigation and clean-up of hazardous substances, as well as personal injury, property damages or natural resource damages arising from the release of, or exposure to, such hazardous substances, may be imposed without regard to violations of laws or regulations or other fault, and may also be imposed jointly and severally.

We may in the future be subject to claims by third parties or employees relating to exposure to hazardous materials and the associated liabilities may be material.

Any failure of our on-going compliance with current and future laws and government regulations, including environment, workplace health and safety, tax and accounting laws, rules and regulations as well as stock exchange listing rules, could have a material adverse effect on our future financial condition and prospects, and/or result in reputational harm.

We may face increased costs and be subject to liability resulting from the generation and disposal of certain wastes, including hazardous wastes, in the course of the Project’s development and/or other future operations.

Our business is subject to stringent and complex laws and regulations relating to the generation, use, handling, storage, recycling, disposal and exposure to solid and hazardous wastes. These laws are frequently subject to change. In the course of our operations, we may generate solid or certain hazardous wastes through the disposal of other materials utilized in our development activities or our future operations. In addition, environmental laws can result in the imposition of liability in connection with end-of-life system disposal.

We own and lease real property and may be subject to requirements regarding the storage, use and disposal of hazardous substances, including spill prevention, control and counter-measure requirements. If our owned or leased properties are contaminated, whether during or prior to our ownership or operation, we could be responsible for the costs of investigation and cleanup and for any related liabilities, including claims for damage to property, persons or natural resources. That responsibility may arise even if we were not at fault and did not cause or were not aware of the contamination. The costs of compliance with laws relating to the management and disposal of solid and hazardous wastes or the remediation of any contamination to which we are or may be responsible, and any changes to our operations mandated by new or amended laws, may be significant. Failure to comply with such laws and regulations could result in significant expenses, delays or fines, which in turn could have a material adverse effect on our results of operations and financial position.

Land reclamation requirements may be burdensome on our financial position.

Land reclamation requirements are generally imposed on companies with mining operations or mineral exploration companies in order to minimize long-term effects of land disturbance. We are required to mitigate long-term environmental impacts at the Project by stabilizing, contouring, re-sloping, and revegetating various portions of the site after wellfield and processing operations are completed. In addition, we are responsible for plugging and abandoning all injection recovery, water monitoring, and exploration drilling holes. In undertaking these reclamation activities, we must meet comprehensive environmental protection and reclamation standards. Any failure to meet such standards may subject us to fines, penalties, or other sanctions. In addition, in order to carry out reclamation obligations imposed on us in connection with exploration, potential development and production activities, we must allocate financial resources that might otherwise be spent on exploration and development programs. We currently have reclamation obligations and have arranged surety bonds for reclamation related costs. If we are required to carry out unanticipated reclamation work, our financial position could be adversely affected.

The physical consequences of climate change could have a material adverse effect on our properties and proposed business activities.

Climate change may increase the frequency or intensity of adverse weather conditions, such as tropical storms, wildfires, droughts, floods, hurricanes, tornadoes, extreme temperatures or ice storms and may have the long-term effect of changing weather patterns in ways that are difficult to anticipate, which may result in damage or destruction to our assets or to third party assets on which we rely, affect the availability of water for our facilities, or otherwise require us to incur costs, or elicit changes in applicable regulations in the jurisdictions in which we operate, which may result in, among other impacts, increased compliance costs, reduced revenues, restrictions on our proposed operations, and difficulties in obtaining or maintaining permits, licenses or authorizations required for our proposed business. Any such disruption may prevent or delay us from continuing to develop the Project and any other of our properties, or, if and when completed, operating in the normal course.

Certain of our operations are dependent on particular meteorological conditions. Climate change may have a long-term and permanent effect on meteorological patterns, including the frequency or intensity of wind, precipitation, or change in temperatures at the Project and any other of our properties. Furthermore, components of our systems could be damaged by severe weather, such as wildfires, hailstorms, tornadoes, hurricanes, flooding, drought, high or low temperatures or other weather conditions. Replacement and spare parts for key components may be difficult or costly to acquire or may be unavailable. Unfavorable weather and atmospheric conditions could impair the effectiveness of our assets or reduce their output beneath their estimated or engineered capacity or require shutdown of key equipment, impeding future operation of our assets.

The increasing concentration of greenhouse gases in the Earth’s atmosphere is contributing to climate changes that are having significant physical effects, such as increased frequency and severity of storms, droughts, fires, floods and other climatic events. If any such effects were to occur in the regions in which we explore, develop and operate, they could adversely affect or delay such activities and may otherwise cause us to incur significant costs in preparing for or responding to those effects.

New or evolving sustainability and climate-related disclosure obligations and expectations could result in additional costs of compliance, restrictions on our access to capital, and increased litigation or reputational risk.

We are subject to evolving and potentially diverging sustainability and climate-related disclosure views and expectations from regulators, investors, customers and other stakeholders. Although federal climate disclosure requirements remain subject to change, we operate in California and may be affected by state-level requirements, customer requirements, investor expectations and broader market practices. Compliance with new or evolving requirements may require additional controls, data collection, third-party support, disclosure processes and management attention, and any failure to meet or timely meet applicable requirements or stakeholder expectations could result in increased costs, litigation, enforcement, reputational harm or other adverse effects. Moreover, if we are effective at addressing such matters, we may also attract negative attention from stakeholders and regulators with diverging views on ESG and sustainability.

Further, those investors, employees, customers and other stakeholders that judge companies’ performance on sustainability matters may make investment decisions based on organizations that publish sustainability ratings or assessments. Topics evaluated in these assessments include, for example, climate impacts, human rights, land use, human capital management, ethics and compliance, and board oversight of sustainability issues. There can be no assurance that we could successfully manage such issues or meet these stakeholders’ expectations. Failure to do so could result in adverse impacts on our reputation, relationships, business, or operating results.

We are required to obtain, maintain, amend and renew governmental permits in order to conduct development and mining operations, a process that is often costly and time-consuming.

In the ordinary course of business, mining companies are required to seek governmental permits, licenses, authorizations and approvals for continuation or expansion of existing operations and for the commencement of new operations. Obtaining, maintaining, amending and renewing governmental permits can be costly and time-consuming and involves numerous jurisdictions and agencies, public notice and comment processes, technical submissions and ongoing compliance obligations. Private parties, such as environmental activists, frequently attempt to intervene in the permitting process and to persuade regulators to deny necessary permits or seek to overturn permits that have been issued. Obtaining the necessary governmental permits involves numerous jurisdictions, public hearings and possibly costly undertakings. These third-party actions can materially increase the costs and cause delays in the permitting process and could potentially cause us to not proceed with the development or operation of our properties.

Although major permits and approvals for the Project are in place, Phase 1 development and commercial-scale operations may require additional permits, permit amendments, modifications, renewals, authorizations and bonding, including modifications to the EPA permit to address different wellfield designs and the permitted term or period of operations, and approvals related to evaporation ponds, waste discharge requirements, air permits, construction and occupancy permits and other matters. We cannot assure you that required permits, amendments or approvals will be obtained or maintained on acceptable terms or in a timely manner, or that regulators will agree with our interpretation of the approvals required. Any delay, denial, modification, appeal, challenge or failure to comply with permits could delay, limit or prevent our development plans or operations and could materially adversely affect our business.

Lawsuits or arbitration proceedings may be commenced against us and an adverse ruling could adversely affect our business, financial condition and results of operations.

We may from time to time be subject to claims, litigation, arbitration, regulatory proceedings, governmental inspections, audits or investigations arising in the ordinary course of business, including matters relating to commercial disputes, vendors, contractors, employees, securities laws, permits, title, environmental matters, intellectual property or other matters. In addition, we may also be subject to class action lawsuits, including those alleging violations of the Fair Labor Standards Act and state and municipal wage and hour laws. Even if we ultimately prevail, such proceedings may require significant management attention and expense. An adverse ruling, settlement or other resolution could have a material adverse effect on our business, financial condition, cash flows or results of operations.

Moreover, governmental authorities and private parties may bring lawsuits based upon damage to property and injury to persons resulting from the environmental, health and safety impacts of prior and current operations, including operations conducted by other mining companies many years ago at sites located on properties that we currently own or own in the future. These lawsuits could lead to the imposition of substantial fines, remediation costs, penalties and other civil and criminal sanctions. We cannot assure you that any such law, regulation, enforcement or private claim would not have a material adverse effect on our financial condition, results of operations or cash flows.

We are vulnerable to the risks associated with operating in a single geographic region and concentrating our capital investment in the State of California increases our exposure to that risk.

We expect to focus our operational activities and capital investments at the Project in California. Should we be able to bring the Project into production, we would then be solely dependent upon a single mining operation for our revenue and profits and all of our operations would be conducted in a single geographic region in the western United States in California. The geographic concentration of our operations may disproportionately expose us to disruptions in our operations if the region experiences severe weather, transportation capacity constraints, constraints on the availability of required equipment, facilities, personnel or services, significant governmental regulation or natural disasters. If any of these factors were to impact the region in which we operate more than other borate producing regions, our business, financial condition, results of operations and cash flows could be adversely affected relative to other mining companies that have a more geographically diversified asset portfolio.

In addition, scientists have warned that increasing concentrations of greenhouse gases in the Earth’s atmosphere may produce climate changes that have significant physical effects, such as increased frequency and severity of storms, droughts and floods and other climatic events. For example, the State of California has experienced several years of increasingly more extreme drought and forest fires throughout the state. If these warnings are correct, and if any such climate-related weather and environmental effects were to detrimentally impact the areas where we or our customers operate, they could have an adverse effect on our business, financial condition and prospects.

The operation or development of our facilities could be adversely affected by local communities and/or other stakeholders.

Relationships with local communities and other stakeholders may impact the development or operations of the Project as well as other future projects. We may become impacted by the interests of local communities and other stakeholders, including in some cases, Indigenous peoples. Certain of these communities or other stakeholders may have or may develop interests or objectives which are different from, or even in conflict with, our objectives, including the use of our project lands and waterways near our facilities. Our relationships with the communities near the Project and other stakeholders are critical to the future success of the Project, as well as at any future development. There is an increasing level of public concern relating to the perceived effect of mining activities on the environment and on communities impacted by such activities. Publicity adverse to the Project, or the mining industry generally, could have an adverse effect on our development plans or future operations and may impact relationships with the communities in which we ultimately operate and other associated stakeholders.

We may in the future, be subject to disputes with local communities, including Indigenous peoples, regarding the use of certain aspects of our assets, facilities and land and may in the future, be required to enter into settlement agreements providing for such use, on terms that include, among others, lump sum payments, royalty payments or restrictions on our business.

In addition, disputes surrounding Indigenous land claims regarding lands on or near our properties could interfere with future operations and/or result in additional operating costs or restrictions, as well as adversely impact the use and enjoyment of our real property rights with respect to our assets.

While we are focused on operating in a socially responsible manner regarding the operation or development of our facilities, there can be no assurance that our efforts in this respect will mitigate this potential risk. All the foregoing could have a material adverse effect on our business, financial condition and results of operations, including, but not limited to, as a result of increased costs, reduced revenues, diversion of management attention, reputational harm, disruptions to our operations and other reasons.

We currently plan to continue to invest significant amounts of capital in a variety of exploration activities, which involve many uncertainties and risks that could prevent us from realizing profits or may result in the total or partial loss of our investment.

Our exploration and development activities may be delayed, more costly than anticipated or unsuccessful for many reasons, including declines in boric acid and its derivatives, lithium carbonate, HCl and gypsum, cost overruns, unanticipated financial, operational or political events, mechanical and technical difficulties, increases in operating cost structures, equipment and labor shortages, industrial actions or other circumstances which may result in the delay, suspension or termination of our exploration and development projects, the total or partial loss of our investment in such projects and activities and a material adverse effect on our results of operations, financial condition and prospects.

Our future success depends on the continuing efforts of our management and key employees and our ability to attract and retain highly skilled personnel.

The responsibility of overseeing the day-to-day operations and the strategic management of our business depends substantially on our senior officers and our key personnel. Loss of such personnel may have an adverse effect on our performance. The success of our operations will depend upon numerous factors, many of which are beyond our control, including our ability to attract and retain additional key personnel in sales, marketing, commercial, engineering and technical support and finance. We currently depend upon a relatively small number of key persons to seek out and form strategic alliances and find and retain additional employees. Certain areas in which we operate are highly competitive regions and competition for qualified personnel is intense. We may be unable to hire suitable field personnel for our technical team or there may be periods of time where a particular position remains vacant while a suitable replacement is identified and appointed.

Our inability to hire and maintain suitable personnel could have a material adverse effect on us and could prevent us from effectively pursuing our business plan, including developing, growing, and operating our business profitably.

We also depend upon third parties, including consultants, engineers, suppliers and others, for their development, construction and operating expertise and expect to remain so for the foreseeable future. Our ability to continue conducting our activities is in large part dependent upon the efforts of third parties. Highly qualified consultants and engineers are expensive and difficult to attract and retain. We may need to engage additional third parties for new development projects, to establish mineral reserves through drilling, to carry out environmental and social impact assessments, to develop processes to extract boron and lithium and other materials, and to continue to develop the Project. If such parties’ work is deficient or negligent or is not completed in a timely manner, it could have a material adverse effect on us. As a result, our use of services of consultants could have a material adverse effect on us and could prevent us from effectively pursuing our business plan.

We will need to increase the size and capabilities of our organization and we may be unable to manage our growth effectively.

Our past growth has provided, and our future growth may create, challenges to our organization. Members of our management team possess significant experience and have previously carried out or been exposed to exploration, development and production activities. However, we have limited operating history and our ability to achieve our objectives depends on the ability of our directors, officers and management to implement current plans and respond to any unforeseen circumstances that require changes to those plans. The execution of our business plan will place demands on us and our management. In the future, we expect to hire and train new personnel as we continue to grow and expand our operations. Our ability to recruit, assimilate, and maintain new personnel will be critical to our performance and we will be required to recruit additional personnel to achieve our business objectives. As a public company, we will need to support managerial, operational, financial and other resources. This growth may place significant strain on us. Successful growth is also dependent upon our ability to implement appropriate financial and management controls and systems and procedures. If we are unable to recruit additional personnel and effectively train, motivate, retain, and manage employees, or if we fail to manage these challenges effectively, our financial condition, business, and results of operations could be materially and adversely affected. As we advance FEL-3 and potential Phase 1 development, we expect to need additional engineering, project management, construction, operating, safety, finance, legal, commercial and administrative capabilities. If we are unable to hire, train and retain personnel or effectively scale our systems, controls and processes, our ability to execute our business plan could be adversely affected.

Our directors and officers may in the future be in a position of a conflict of interest.

Some of our directors and officers currently also serve as directors and officers of other companies involved in natural resource exploration, development and production, and any of our directors may in the future serve in such positions. As at the date of this report, none of our directors or officers serves as an officer or director of a minerals exploration, development or producing company nor possesses a conflict of interests with our business. However, there exists the possibility that they may in the future be in a position of a conflict of interest.

Compliance with ever-evolving federal and state laws and other requirements relating to the processing of information about individuals necessitates significant expenditure and resources, and any failure by us or our vendors to comply may result in significant liability, negative publicity, and/or an erosion of trust, which could materially adversely affect our business, results of operations, and financial condition.

In connection with running our business, we receive, store, use and otherwise process information that relates to individuals and/or constitutes “personal data,” “personal information,” “personally identifiable information,” or similar terms under applicable data privacy laws (collectively, “Personal Information”), including from and about actual and prospective customers, as well as our employees and business contacts. We also depend on third-party vendors in relation to the operation of our business, a number of which process Personal Information on our behalf.

We and our vendors are subject to a variety of federal and state data privacy laws, rules, regulations, industry standards and other requirements, including those that apply generally to the processing of Personal Information, and those that are specific to certain industries, sectors, contexts, or locations. These requirements, and their applications, interpretations and amendments, are constantly evolving. It is also possible that new laws, regulations and other requirements, or amendments to or changes in interpretations of existing laws, regulations and other requirements, may require us to incur significant costs, implement new processes, or change our processing of information and business operations, which could ultimately hinder our ability to grow our business by extracting value from our data assets.

For example, the California Consumer Privacy Act (“CCPA”) requires businesses that process personal information of California residents to, among other things: provide certain disclosures to California residents regarding the business’s collection, use, and disclosure of their personal information; receive and respond to requests from California residents to access, delete, and correct their personal information, or to opt out of certain disclosures of their personal information; and enter into specific contractual provisions with service providers that process California resident personal information on the business’s behalf. The enactment of the CCPA is prompting a wave of similar legislative developments in other states in the United States, which creates a patchwork of overlapping but different state laws.

In 2024, the National Security Division of the U.S. Department of Justice (“DOJ”) issued a new rule—referred to as the “Data Security Program” (“DSP”)—to implement Executive Order 14117 aimed at preventing access to “bulk U.S. sensitive personal data” and “government-related data” by “countries of concern” (including China, Russia, Iran, North Korea, Cuba, and Venezuela) and “covered persons” (as all such terms are defined in the DSP). Based on our assessment of the DSP, we do not believe we engage in covered data transactions at this time, though we may discover that we do or we may begin doing so in the future.

We could be subject to information technology system failures, network disruptions, and breaches in data security – including as a result of artificial intelligence –which could negatively affect our business, financial position, results of operations and cash flows.

The efficiency and efficacy of our business and its operations depend heavily on the performance and availability of our computer and information systems, which we use to communicate, control and manage our operations and prepare our financial management and reporting information. As dependence on digital technologies is expanding, cyber incidents, including deliberate attacks and accidental cybersecurity events have been increasing worldwide. We face numerous and evolving cybersecurity risks that threaten the confidentiality, integrity and availability of our information systems and confidential information, including from diverse threat actors, such as state-sponsored organizations, opportunistic hackers and hacktivists, as well as through diverse attack vectors, such as social engineering/phishing, company insiders, suppliers or providers, and as a result of human or technological error, including misconfigurations, bugs, or other vulnerabilities in software and hardware. Computers, telecommunication and information systems are used to conduct our exploration and development activities, will be used to conduct our production activities and have become an integral part of our business. We use these systems to analyze and store financial and operating data, as well as to support our internal communications and interactions with business partners. Cyber-attacks could compromise our computer, telecommunications and information systems and result in additional costs as well as disruptions to our business operations or the loss of our data. Cyberattacks are expected to accelerate on a global basis in frequency and magnitude as threat actors are becoming increasingly sophisticated in using techniques and tools, including artificial intelligence, that circumvent security controls, evade detection and remove forensic evidence. As a result, we may be unable to detect, investigate, remediate or recover from future attacks or incidents, or to avoid a material adverse impact to our information systems, confidential information or business. A cyber-attack involving our information systems and related infrastructure, or those of our business partners, could disrupt our business and negatively impact our operations in a variety of ways. Our information systems and confidential information are vulnerable to a range of cybersecurity risks and threats, including malicious code embedded in open-source software, or misconfigurations, “bugs” or other vulnerabilities in commercial software that is integrated into our (or our suppliers’ or service providers’) IT systems, products or services. Although we maintain insurance policies, we cannot be certain that any or all of the costs and liabilities incurred in relation any cybersecurity attack or incident will be covered or that applicable insurance will be available to us in the future on economically reasonable terms or at all. We and certain of our third-party providers regularly experience cyberattacks and other incidents, and we expect such attacks and incidents to continue in varying degrees. While to date no incidents have had a material impact on our operations or financial results, we cannot guarantee that material incidents will not occur in the future.

Given the size of our organization, we rely heavily on the use of, and services provided by third parties, including for a significant portion of our key cybersecurity risk management. Because we make extensive use of third-party suppliers and service providers, such as cloud services that support our internal and customer-facing operations, successful cyberattacks that disrupt or result in unauthorized access to third party information systems can materially impact our operations and financial results.

Such material risks and threats include, but are not limited to, the following:

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impacts to availability of systems or data, e.g., operational disruption such as ransomware, even if no direct impact to information data is involved. For instance:

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an attack on the computers or information systems which control our mining operations could cause a temporary interruption of our production;

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a cyberattack on our accounting, accounts payable or related information systems could expose us to liability to employees and third parties, or reputational risk, if their sensitive personal information is obtained;

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possible loss of material information, which in turn could delay productive processes and selling efforts, causing economic losses; and

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a cyberattack on a service provider or their information systems which we rely on could result in supply chain disruptions, which could delay or halt our major development projects.

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Non-malicious (e.g., unintentional) incidents that have an adverse impact on confidentiality, integrity or availability of information or systems resulting from human or system error or malfunction.

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A third party or supply chain incident, e.g., incidents that impact our company due to an impact on a vendor, service provider, supply chain player, partner, or any other third party.

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Further material risks connected to aforementioned cybersecurity incidents include but are not limited to:

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theft, loss, or unauthorized disclosure of sensitive information,

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financial loss, including the costs of forensic investigation, remediation, individual and regulatory notification, credit monitoring, regulatory fines and litigation, including class-action litigation,

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legal and regulatory penalties or enforcement, including under privacy and data protection laws such as the California Consumer Privacy Act (as amended by the California Privacy Rights Act), state data breach notification laws, and SEC cybersecurity incident disclosure requirements, and

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damage to our reputation.

In addition, we and our service providers increasingly use artificial intelligence, machine learning, and automated decision-making technologies, systems, and tools (collectively, “AI Technologies”) in our operations. We expect that increased investment will be required in the future to continuously improve our use of AI Technologies. As with many technological innovations, there are significant risks involved in developing, maintaining, and deploying these technologies, and there can be no assurance that the usage of or our investments in such technologies will always enhance our products or services or be beneficial to our business, including our efficiency or profitability. Our use of AI Technologies presents its own cybersecurity and data privacy risks. For example, our personnel could intentionally or inadvertently input confidential, proprietary, or personal information into third-party AI Technologies, potentially resulting in the unauthorized disclosure or loss of confidential information, the loss of trade secrets and other intellectual property, or violations of applicable privacy or data protection laws. Artificial intelligence systems may also produce inaccurate, incomplete or biased output, and any over-reliance on such output could adversely affect our operations or decision-making. In particular, if the models underlying our AI Technologies are incorrectly designed or implemented; trained or reliant on incomplete, inadequate, inaccurate, biased or otherwise poor quality data, or on data to which we do not have sufficient rights or in relation to which we and/or the providers of such data have not implemented sufficient legal compliance measures; used without sufficient oversight and governance to provide for their responsible use; and/or adversely impacted by unforeseen defects, technical challenges, cybersecurity threats, data privacy concerns, or material performance issues , the performance of our products, services and business, as well as our reputation, could suffer or we could incur liability resulting from the violation of laws or contracts to which we are a party or civil claims. Moreover, the integration and use of AI creates unique attack vectors, such as the infiltration, corruption (e.g., “poisoning”), or manipulation of training data and AI model inputs, that can lead to downstream impacts, such as inaccurate model outputs and skewed decision-making.

Risks Relating to Our Common Stock

Our largest stockholders hold a significant percentage of our voting power and may be able to exert significant influence or control over the direction of our business.

Our largest stockholders, Bluescape Special Situations IV (“Bluescape”), Meridian Investments Corporation (“Meridian”) and Ascend Global Investment Fund SPC for and on behalf of Strategic SP (together with Meridian, “Ascend”), hold a significant percentage of our outstanding common stock, par value $0.01 per share (“Common Stock”). Notwithstanding that these parties no longer hold a controlling interest, they collectively hold approximately 49.2% of our Common Stock. If Meridian, Ascend and Bluescape were to choose to act together, they would be able to control or significantly influence matters submitted to our stockholders for approval, as well as our management and affairs. For example, these parties, if they choose to act together, could control or significantly influence the election of directors and the approval of any merger, consolidation or sale of all or substantially all of our assets. This concentration of ownership control may delay, defer or prevent a change in control, entrench our management or the board of directors, or impede a merger, consolidation, takeover or other business combination involving us that other stockholders may desire. These parties may have interests that are different than those of other stockholders.

Under the Fourth Amended and Restated Investor and Registration Rights Agreement (the “IRRA”), Bluescape and Ascend have director designation rights based on their beneficial ownership levels. Bluescape has two designees based on its current beneficial ownership level, while Ascend has one current designee based on its current beneficial ownership level, representing, in the aggregate, three of the five members of our board of directors. These rights, together with the ownership interests of Bluescape, Ascend and Meridian, may allow such stockholders to exert substantial influence over our business and strategic direction.

Exercise of our outstanding warrants or issuance of additional securities will dilute the ownership interest of our existing stockholders or may otherwise depress the price of our Common Stock.

We have issued warrants in prior financings and may issue additional warrants or other securities in future financings, strategic transactions, government financing arrangements or other transactions. We also issued warrants in connection with the EXIM-related guarantee arrangements for a loan under EXIM’s engineering multiplier program. Furthermore, we expect to issue 8,300,000 shares of Common Stock in connection with the Acquisition as described below. As of September 16, 2026, the Company had 41,647,371 shares of Common Stock issued and outstanding. The issuance of the shares in the Acquisition would represent approximately 16.6% of the Company’s issued and outstanding shares of Common Stock on a post-issuance basis.

The exercise of some or all outstanding warrants, or the issuance or potential issuance of additional warrants, equity securities, convertible securities, preferred equity, strategic equity or other securities, will dilute the ownership interests of existing stockholders and may increase the number of shares of Common Stock eligible for resale in the public market. Any sales in the public market of shares of Common Stock issuable upon exercise or conversion of such securities, or the anticipation of such exercises, issuances or sales, could adversely affect the prevailing market price of our Common Stock. Additionally, the existence of warrants or other convertible securities may encourage short selling by market participants because the exercise or conversion of such securities could be used to satisfy short positions, or because the anticipated exercise or conversion of such securities for shares of Common Stock could depress the price of our Common Stock.

Our Common Stock is listed and publicly traded on Nasdaq. The market price of our Common Stock may be highly volatile and subject to wide fluctuations. In addition, the trading volume of our Common Stock may fluctuate and cause significant price variations to occur. If the market price of our Common Stock declines, you may be unable to resell your Common Stock at a competitive price. We cannot assure you that the market price of our Common Stock will not fluctuate or significantly decline in the future or that an active trading market for our Common Stock will be maintained.

Some specific factors that could negatively affect the price of our Common Stock or result in fluctuations in its price and trading volume include:

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changes in the demand for, or market prices for, borates, lithium, calcium chloride, gypsum, and other minerals;

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additions or departures of our key personnel;

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changes or proposed changes in laws, regulations or tax policy;

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sales or perceived potential sales of our Common Stock by us or our directors, senior management or stockholders in the future;

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announcements or expectations concerning additional commercial and financing efforts;

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conditions in the U.S. and global financial markets, or in our industry in particular, or changes in general economic conditions; and

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In recent years, the stock markets generally have experienced extreme price and volume fluctuations that have often been unrelated or disproportionate to the operating performance of those companies. Broad market and industry factors may significantly affect the market price of our Common Stock, regardless of our actual operating performance.

We incur increased costs as a result of operating as a U.S. listed public company, and our management is required to devote substantial time to compliance initiatives and corporate governance practices.

As a U.S. listed public company we incur, and particularly after we are no longer an “emerging growth company” we expect to incur, significant additional legal, accounting, and other expenses. The Dodd-Frank Wall Street Reform and Consumer Protection Act (the “Dodd-Frank Act”), the Sarbanes-Oxley Act of 2002 (the “Sarbanes-Oxley Act”), the listing requirements of Nasdaq, and other applicable securities rules and regulations impose various requirements on public companies, including establishment and maintenance of effective disclosure and financial controls and corporate governance practices. We expect that we will need to hire additional accounting, finance, legal, and other personnel in connection with our efforts to comply with the requirements of being a public company, and our management and other personnel will need to devote a substantial amount of time towards maintaining compliance with these requirements. These requirements increase our legal and financial compliance costs and make some activities more time-consuming and costly. In addition, we expect that the rules and regulations applicable to us as a public company may make it more difficult and more expensive for us to obtain directors’ and officers’ liability insurance, which could make it more difficult for us to attract and retain qualified members of our board of directors or executive officers.

We are subject to Section 404 of the Sarbanes-Oxley Act and the related rules of the SEC, which generally require our management and independent registered public accounting firm to report on the effectiveness of our internal control over financial reporting. Beginning with our 2023 Annual Report on Form 10-K, Section 404 required an annual management assessment of the effectiveness of our internal control over financial reporting. However, for so long as we remain an emerging growth company as defined in the Jumpstart Our Business Startups Act of 2012 (the “JOBS Act”), we intend to take advantage of certain exemptions from various reporting requirements that are applicable to public companies that are not emerging growth companies, including, but not limited to, not being required to comply with the auditor attestation requirements of Section 404. Once we are no longer an emerging growth company or, if prior to such date, we opt to no longer take advantage of the applicable exemption, we will be required to include an opinion from our independent registered public accounting firm on the effectiveness of our internal control over financial reporting.

An active trading market for our Common Stock may not be sustained and the trading price for our Common Stock may fluctuate significantly.

Shares of our Common Stock are able to be traded by the public on Nasdaq. However, a liquid public market for our Common Stock may not be sustained, which means you may experience a decrease in the value or trading price of shares of our Common Stock, regardless of our operating performance. In the past, following periods of volatility in the market price of a company’s securities, securities class action litigation has often been instituted against that company. If we were involved in any similar litigation, we could incur substantial costs and our management’s attention and resources could be diverted.

Because we do not anticipate paying dividends on our Common Stock in the foreseeable future, capital appreciation, if any, will be your sole source of gain on our Common Stock.

We have not declared dividends, and we do not anticipate that we will do so in the foreseeable future. We currently intend to retain future earnings, if any, to finance the development of our proposed business. Dividends, if any, on our outstanding Common Stock will be declared by and subject to the discretion of our Board of Directors on the basis of our earnings, financial requirements and other relevant factors, and subject to Delaware and federal law. We cannot assure you that our Common Stock will appreciate in value. You may not realize a return on your investment in our Common Stock and you may even lose your entire investment in our Common Stock.

If securities or industry analysts do not publish research or reports about our business, or if they issue an adverse or misleading opinion regarding our stock, the market price and trading volume of our Common Stock could decline.

The trading market for our Common Stock will be influenced by the research and reports that securities or industry analysts publish about us or our business. Securities and industry analysts may discontinue research on us, to the extent such coverage currently exists, or in other cases, may never publish research on us. If no or few securities or industry analysts commence coverage of us, the trading price for our Common Stock could be negatively affected. In the event securities or industry analysts initiate coverage, if one or more of the analysts who cover us downgrade our Common Stock or publish adverse or misleading research about our business, the market price of our Common Stock would likely decline. If one or more of these analysts cease coverage of us or fail to publish reports on us regularly, we could lose visibility in the financial markets, demand for our Common Stock could decrease, which might cause our price and trading volume to decline.

We are an “emerging growth company” and “smaller reporting company” and are able to avail ourselves of reduced disclosure requirements, which may make our Common Stock less attractive to investors.

We are an “emerging growth company” as defined in the JOBS Act and a “smaller reporting company” as defined in SEC rules, and we may take advantage of certain exemptions from reporting requirements that are applicable to other public companies. For example, we have elected to rely on an exemption from the auditor attestation requirements of Section 404 of the Sarbanes-Oxley Act relating to internal control over financial reporting, and we will not provide such an attestation from our auditors while we qualify for that exemption.

We may avail ourselves of certain disclosure exemptions until we are no longer an emerging growth company or smaller reporting company, as applicable. We cannot predict whether investors will find our Common Stock less attractive because of our reliance on some or all of these exemptions. If investors find our Common Stock less attractive, it may adversely affect the price of our Common Stock and there may be a less active trading market for our Common Stock.

We will cease to be an “emerging growth company” upon the earliest date permitted or required under applicable SEC rules, including based on the passage of time since our first sale of common equity securities pursuant to an effective Securities Act registration statement, our revenues, our public float or our issuance of certain debt securities. We will continue to qualify as a smaller reporting company for so long as we meet the applicable public float or revenue tests.

Effective internal control over financial reporting is necessary for us to provide reliable financial reports, prevent fraud and operate successfully as a public company. If we cannot provide reliable financial reports or prevent fraud, our reputation and operating results would be harmed. As a result of being a public company, we are required, under Section 404 of the Sarbanes-Oxley Act, to furnish a report by management on, among other things, the effectiveness of our internal control over financial reporting, which began with our 2023 Annual Report on Form 10-K. This assessment includes disclosure of any material weaknesses identified by our management in our internal control over financial reporting. If we identify one or more material weaknesses in our internal control over financial reporting during the evaluation and testing process, we may be unable to conclude that our internal controls are effective. We have not been, and will not be, audited or subject to an assessment of internal control over financial reporting until we are no longer an emerging growth company. There can be no assurance that no material weakness or significant deficiency will be identified once such an audit or assessment of internal control over financial reporting is completed.

Additionally, when we cease to be an “emerging growth company” under the federal securities laws, our independent registered public accounting firm may be required to express an opinion on the effectiveness of our internal controls. If we are unable to confirm that our internal control over financial reporting is effective, or if our independent registered public accounting firm is unable to express an unqualified opinion on the effectiveness of our internal controls, we could lose investor confidence in the accuracy and completeness of our financial reports, which could cause the price of our Common Stock to decline.

As a public company, we are subject to the periodic reporting requirements of the Exchange Act. We designed our disclosure controls and procedures to provide reasonable assurance that information we must disclose in reports we file or submit under the Exchange Act is accumulated and communicated to management, and recorded, processed, summarized and reported within the time periods specified in the rules and forms of the SEC. We believe that any disclosure controls and procedures, no matter how well-conceived and operated, can provide only reasonable, not absolute, assurance that the objectives of the control system are met. These inherent limitations include the realities that judgments in decision-making can be faulty, and that breakdowns can occur because of simple error or mistake. Additionally, controls can be circumvented by the individual acts of some persons, by collusion of two or more people or by an unauthorized override of the controls. Accordingly, because of the inherent limitations in our control system, misstatements due to error or fraud may occur and not be detected.

Our Certificate of Incorporation and Bylaws contain anti-takeover provisions that could delay or discourage takeover attempts that stockholders may consider favorable and may prevent attempts by our stockholders to replace or remove our current management.

Our Certificate of Incorporation and Bylaws contain provisions that could delay or prevent a merger, acquisition, or other change in control of our company that stockholders may find favorable, including transactions in which stockholders might otherwise receive a premium for their shares. These provisions could also limit the price that investors might be willing to pay in the future for shares of our Common Stock, thereby depressing the market prices for our Common Stock. In addition, these provisions could also make it difficult for stockholders to elect directors who are not nominated by the current members of our Board of Directors or take other corporate actions, including effecting changes in our management. These provisions include, among other things, that:

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allowing only our Board to fill director vacancies, which prevents stockholders from being able to fill vacancies on our Board;

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a prohibition on stockholders action by written consent, which forces stockholder action to be taken at an annual or special meeting of our stockholders;

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a requirement that special meetings of our stockholders may be called only by (i) our Board or (ii) our secretary, following receipt of one or more written demands to call a special meeting from stockholders of record who own, in the aggregate, at least 25% of the voting power of our outstanding shares then entitled to vote on the matter or matters to be brought before the proposed special meeting that complies with the procedures for calling a special meeting set forth in our Bylaws, which may inhibit the ability of an acquirer to require the convening of a special meeting of our stockholders;

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a requirement for the affirmative vote of holders of at least 66 2/3% of the voting power of all of the then-outstanding shares of the voting stock, voting together as a single class, to amend the certain provisions of our Certificate of Incorporation or our Bylaws, which may inhibit the ability of an acquirer to effect such amendments to facilitate an unsolicited takeover attempt;

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the ability of our Board to amend our Bylaws, which may allow our Board to take additional actions to prevent an unsolicited takeover and inhibit the ability of an acquirer to amend the Bylaws to facilitate an unsolicited takeover attempt;

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a prohibition of cumulative voting in the election of our Board, which would otherwise allow less than a majority of stockholders to elect director candidates.

We are also subject to Section 203 of the Delaware General Corporation Law (the “DGCL”), which prevents us from engaging in a business combination, such as a merger, with an interested stockholder (i.e., a person or group that acquires at least 15% of our voting stock) for a period of three years from the date such person became an interested stockholder, unless (with certain exceptions) the business combination or the transaction in which the person became an interested stockholder is approved in a prescribed manner.

Raising additional capital could adversely affect the voting power or value of our Common Stock and result in substantial dilution.

Until such time, if ever, as we can generate substantial revenue, we expect to finance our cash needs through a combination of equity offerings, debt instruments, preferred equity, strategic investments, project-level financing, government funding, warrants, convertible securities, customer prepayments, royalty arrangements or other financing structures. We do not currently have any committed external source of funds sufficient to develop Phase 1 of the proposed Commercial-Scale Facility. In addition, we may seek additional capital due to favorable market conditions or strategic considerations, even if we believe that we have sufficient funds for our current or future operating plans.

The amount of capital needed to develop the Project is substantial relative to our current market capitalization. As a result, additional equity or equity-linked financing could result in significant dilution to existing stockholders. We cannot predict the size or price of future issuances of Common Stock or the size or terms of future issuances of debt instruments, warrants, preferred equity or other securities convertible into or exercisable for Common Stock, or the effect, if any, that future issuances and sales of our securities will have on the market price of the Common Stock. The terms of these securities may include liquidation or other preferences, anti-dilution rights, participation rights, board or consent rights, collateral rights or other terms that adversely affect your rights as a common stockholder.

Our Certificate of Incorporation authorizes us to issue, without the approval of our stockholders, one or more classes or series of Preferred Stock having such designations, preferences, limitations and relative rights, including preferences over our Common Stock respecting dividends and distributions, as our Board of Directors may determine. For example, we might grant holders of Preferred Stock the right to elect some number of our directors in all events or on the happening of specified events or the right to veto specified transactions. The terms of one or more classes or series of Preferred Stock could adversely impact the voting power or value of our Common Stock. Similarly, the repurchase or redemption rights or liquidation preferences we might grant to holders of Preferred Stock could affect the residual value of our Common Stock.

Debt financing and preferred equity financing, if available, may involve agreements that include covenants limiting or restricting our ability to take specific actions, such as incurring additional debt, making capital expenditures, or declaring dividends.

We have in the past and may again in the future receive a notice of the failure to satisfy a continued listing rule from Nasdaq.

Our Common Stock is listed on Nasdaq. Nasdaq maintains several requirements for continued listing of our Common Stock. One such requirement is the maintenance of a minimum closing bid price of $1.00. In September 2024, we received written notice from Nasdaq notifying us that the bid price for our Common Stock had closed below the $1.00 Bid Price Requirement for continued inclusion on The Nasdaq Global Select Market. Although we regained compliance with the Bid Price Requirement in a timely manner, there is no guarantee we will in the future be able to maintain compliance with the Bid Price Requirement or any other Nasdaq listing standard, which would subject our Common Stock to delisting from Nasdaq.

If our Common Stock is delisted from Nasdaq in the future based on any continued listing requirement, it is unlikely that we will be able to re-list our Common Stock on another national securities exchange and, as a result, we expect our securities would be quoted on an over-the-counter market. If this occurs, we could face significant material adverse consequences, including:

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a determination that our Common Stock is a “penny stock” which will require brokers trading in our Common Stock to adhere to more stringent rules, which could result in a reduced level of trading activity in the secondary trading market for our Common Stock;

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more limited news and analyst coverage for us; and

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Delisting also could result in, among other things, a loss of investor confidence or interest in strategic transactions or opportunities, us being subject to regulation in each state in which we offer our securities, and difficulty in recruiting and retaining personnel through equity incentive awards.

Sales of our Common Stock could reduce its market price.

Sales of a substantial number of shares of our Common Stock in the public market could occur at any time. Such sales, or any market perception that substantial holders of our Common Stock intend to sell Common Stock, could reduce the market price of our Common Stock. If a material number of shares are sold during a concentrated period, such sales could adversely affect the market price of our Common Stock and impair our ability to raise additional capital through the sale of securities.

We are a holding company and, as such, we depend on our subsidiaries to generate cash to fund our operations and expenses.

We are a holding company and essentially all of our assets are the capital stock of our subsidiaries. As a result, our investors are subject to the risks attributable to our subsidiaries. As a holding company, we conduct all of our business through our subsidiaries. Therefore, our ability to fund and conduct our business, service our debt and pay dividends, if any, in the future will principally depend on the ability of our subsidiaries to generate sufficient cash flow to make upstream cash distributions to us. Our subsidiaries are separate legal entities, and although they are wholly-owned and controlled by us, they have no obligation to make any funds available to us, whether in the form of loans, dividends or otherwise. The ability of these entities to pay dividends and other distributions will depend on their operating results and will be subject to applicable laws and regulations which require that solvency and capital standards be maintained by such companies and contractual restrictions contained in the instruments governing any debt obligations. In the event of a bankruptcy, liquidation or reorganization of any of our material subsidiaries, holders of indebtedness and trade creditors may be entitled to payment of their claims from the assets of those subsidiaries before us.

Our Bylaws provide that, unless we consent in writing to the selection of an alternative forum, the Court of Chancery of the State of Delaware (or, if the Court of Chancery does not have jurisdiction, the federal district court for the District of Delaware) will, to the fullest extent permitted by applicable law, be the sole and exclusive forum for certain derivative actions, fiduciary-duty claims, claims arising under the DGCL, our Certificate of Incorporation or Bylaws and internal-affairs doctrine claims. Our Bylaws further provide that, unless we consent in writing to the selection of an alternative forum, federal district courts of the United States will be the exclusive forum for claims arising under the Securities Act.

These choice-of-forum provisions may limit a stockholder’s ability to bring a claim in a judicial forum that it finds favorable for disputes with us or our directors, officers, employees or agents, which may discourage such lawsuits against us and such persons. Alternatively, if a court were to find these provisions of our Bylaws inapplicable to, or unenforceable in respect of, one or more of the specified types of actions or proceedings, we may incur additional costs associated with resolving such matters in other jurisdictions, which could adversely affect our business, financial condition or operating results.

Risks Relating to the Pending Acquisition

The pending Acquisition and additional businesses or assets we may acquire, joint ventures we may form or investments in other companies we may make in the future may be unsuccessful and may harm our operating results and prospects.

Our pending Acquisition of specified assets of SVM and any additional acquisitions of complementary businesses or assets we may pursue may not be successful. The Acquisition is being effected through a court-supervised sale pursuant to section 363 of the Bankruptcy Code in connection with the Chapter 11 Cases, which involves risks that are distinct from a negotiated acquisition outside of bankruptcy. Once it is entered, the Sale Order may be subject to appeal, modification, stay or reversal. The type of financing for the Acquisition and any other acquisition will depend on circumstances existing at that time, including market conditions and our share price. If we are successful at identifying and making the Acquisition and any other acquisitions, integration of the SVM business or any other acquired businesses or assets nevertheless involves many challenges, including a potential strain on our administrative and operational resources, unanticipated issues, expenses or liabilities, and difficulties in the assimilation of different corporate cultures and business practices. We may also seek to enter into joint ventures, pursue strategic alliances in an effort to leverage our existing operations and industry experience, increase our product offerings, expand our distribution and make investments in other companies. We cannot guarantee that we will be able to identify and complete suitable acquisitions or investments at reasonable prices, or that we will be successful in realizing any anticipated benefits from our pending Acquisition or from any future acquisitions or investments.

The success of the Acquisition and any future acquisitions, joint ventures, strategic alliances or investments involve a number of risks, the occurrence of which could adversely affect our business, reputation, operating results and financial condition. Such risks include, without limitation: diversion of management’s attention; disruption to our existing operations and plans; inability to effectively manage our expanded operations; difficulties or delays in integrating and assimilating information and financial systems and operations or in realizing projected efficiencies, growth prospects, cost savings, and synergies; potential loss of key employees and customers of the acquired businesses or adverse effects on existing business relationships; adverse impact on overall profitability if our expanded operations do not achieve the financial results projected in our valuation models; inaccurate assessment of additional post-acquisition investments, undisclosed, contingent, tax or other liabilities or problems, unanticipated costs associated with an acquisition and an inability to recover or manage such liabilities and costs; incorrect estimates made in the accounting for acquisitions; and incurrence of non-recurring charges and write-off of significant amounts of goodwill or other assets as a result of deterioration in the performance of an acquired business or product line, adverse market conditions, changes in the competitive landscape, changes in laws or regulations that restrict activities of an acquired business or product line, or as a result of a variety of other circumstances.

Additionally, the success of the Acquisition and any future acquisitions will substantially depend on our ability to retain key personnel. For example, we will rely on existing employees and operators of SVM to successfully operate the SVM Assets. The loss of key employees could result in the loss of vital institutional knowledge, experience and expertise, damage critical customer relationships and impact our ability to successfully operate SVM’s business and implement our strategy for these assets. Specifically, the loss of key employees who have in-depth knowledge of SVM’s mining, manufacturing, engineering, research and development, and administrative processes could significantly impact our results of operations. We may not be able to find qualified replacements for these key positions and the integration of replacements may be disruptive to the business. We may face similar challenges in connection with any future acquisitions we pursue.

The Acquisition is subject to closing conditions and may not be completed, and the Asset Purchase Agreement may be terminated in accordance with its terms.

The Acquisition is subject to customary conditions that must be satisfied or waived prior to the Closing, including, among others, (i) that the Sale Order must be entered and not be subject to stay, vacatur or reversal (or modified in a manner materially adverse to Nirma without its consent), (ii) the satisfaction of certain requirements under the bidding procedures approved by the Bankruptcy Court, (iii) the execution and delivery of definitive documentation for the Promissory Note (as defined below) and the Bridge Facility (as defined below) and the funding of the initial tranche of the Bridge Facility, and (iv) the absence of any law or order enjoining or otherwise prohibiting the Acquisition. The Closing is also conditioned upon, with respect to the acquisition of the railroad assets of Trona Railway Company LLC, the receipt of any required authorization from the Surface Transportation Board (the “STB”). If such STB authorization has not been received at the time of Closing, the transfer of such railroad assets will be deferred until such authorization is obtained. Additionally, the Closing is subject to the satisfaction of closing conditions applicable to Nirma, the provider of the bridge financing described below, including that the Closing occur on or before October 2, 2026 unless Nirma consents to an extension of the Outside Date (as defined below). Nirma’s failure to satisfy, or to waive, its closing conditions could prevent the consummation of the Acquisition.

Furthermore, there is a short time period between the entry into the Asset Purchase Agreement and the expected Closing. The Asset Purchase Agreement may be terminated if the Closing has not occurred on or before October 2, 2026 (the “Outside Date”), provided that the Outside Date may be extended to October 16, 2026, by SVM, subject to the consent of Nirma, and thereafter by the mutual written consent of the parties.

No assurance can be given that these conditions will be satisfied or waived within the applicable time period or that, if satisfied, the Acquisition will be completed on the expected timetable. Any failure or delay in completing the Acquisition could cause the Company not to realize, or to be delayed in realizing, some or all of the anticipated benefits of the Acquisition.

Moreover, if the Acquisition is not completed, our ongoing business may be adversely affected for example:

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we may experience negative reactions from our business partners and employees;

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we will be required to pay certain costs relating to the Acquisition, including financial advisory, legal, financing and accounting costs and associated fees and expenses, whether or not the Acquisition is completed;

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the market price of our Common Stock could decline to the extent that the current market price reflects a market assumption that the Acquisition will be completed; and

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matters relating to the Acquisition (including diligence, proceedings in the Chapter 11 Cases and transition planning) will require substantial commitments of time and resources by management and other key employees, which could otherwise have been devoted to day-to-day operations or to other opportunities that may have been beneficial to us as an independent company.

The consideration payable under the Asset Purchase Agreement is fixed and will not be adjusted based on our performance.

Under the Asset Purchase Agreement, the total aggregate consideration payable by us consists of (i) approximately $3.4 million in cash (less the $0.3 million deposit made in connection with the signing of the Asset Purchase Agreement), (ii) 8,300,000 shares of the Company’s Common Stock, and (iii) a senior unsecured promissory note in an aggregate principal amount of approximately $6.2 million to be issued by 5E SVM (the “Promissory Note”). Pursuant to the Asset Purchase Agreement, the Company has guaranteed 5E SVM’s obligation to pay the cash consideration and certain of 5E SVM’s indemnification obligations to SVM and Nirma. The purchase price will not be adjusted for changes in the market price of our Common Stock or the economic performance of the Company or SVM. If the market price of our Common Stock increases or the economic performance or outlook of the assets to be acquired declines, the consideration will not be adjusted to account for any such changes or any effective increase or decrease in the value of the consideration issued or paid to SVM under the Asset Purchase Agreement.

The Acquisition will involve substantial costs.

We have incurred and expect to incur substantial non-recurring costs associated with the Acquisition, many of which have been and will be incurred regardless of whether the Acquisition is consummated.

The combined company will also incur significant restructuring and integration costs in connection with the integration of our existing operations with the operations of the SVM Assets and the execution of our business plan, including costs relating to formulating and implementing integration plans and eliminating duplicative costs, as well as potential employment-related costs. The costs related to restructuring will be expensed as a cost of the ongoing results of operations of either us or the combined company. There are processes, policies, procedures, operations, technologies and systems that must be integrated in connection with the Acquisition and subsequent integration. We have assumed that a certain level of expenses will be incurred to integrate the Company and the operations of the SVM Assets and we continue to assess the magnitude of such expenses. Many of these expenses are, by their nature, difficult to estimate accurately and there are many factors beyond our control that could affect the total amount of such expenses and the timing of their incurrence. The net benefit we expect from the elimination of duplicative costs, as well as the realization of strategic benefits, additional income, synergies and other efficiencies in offsetting integration-related costs over time may not be achieved in the near term, or at all.

Furthermore, the Company, SVM and the California Air Resources Board (“CARB”) reached a global settlement resolving CARB’s claims relating to SVM’s pre-Closing operations under the CARB Programs (as defined in the Sale Order), including the cap-and-invest regulation and mandatory reporting regulation. The Sale Order is anticipated to provide that the SVM Assets are to be transferred free and clear of all pre-Closing CARB claims and interests (the “CARB Claims and Interests,” as defined in the Sale Order), and CARB will be permanently barred from asserting any such claims against 5E SVM, the Buyer Group (as defined in the Sale Order) or the Transferred Assets (as defined in the Sale Order). At Closing, SVM will surrender all of its currently held compliance instruments to CARB in satisfaction of SVM’s post-petition, pre-Closing obligations under the CARB Programs. Following the Closing, CARB will treat the facilities acquired by 5E SVM as new facilities, with a new ARB ID and a new compliance instrument tracking system account, and CARB will not true up or reduce 5E SVM’s allowance allocations on the basis of allocations received by SVM pre-Closing. CARB has agreed not to appeal the Sale Order. However, the Sale Order may be subject to appeal by other parties. Other governmental authorities may also challenge the scope of the free-and-clear protections contained in the Sale Order or take actions in the future that are inconsistent with such protections. If such challenges are successful, 5E SVM could face material additional environmental compliance costs, which could have a material adverse effect on our business, financial condition, results of operations and cash flow.

In addition, following the Closing, 5E SVM will be subject to prospective CARB compliance obligations as the owner and operator of the SVM Assets. Such obligations will include the obligation to acquire and surrender compliance instruments to cover the greenhouse gas emissions resulting from the operation of the SVM Assets. Such costs could be material and are difficult to predict, because they will depend on the quantity of future greenhouse gas emissions that our business releases and other factors outside of our control, for example, the quantity, if any, of free compliance instruments received from CARB and the future costs of each compliance instrument that needs to be acquired on the market, which is required to increase each year under the cap-and-invest regulation.

Our stockholders may not realize a benefit from the Acquisition commensurate with the ownership dilution they will experience in connection with the Acquisition.

If we are unable to realize the full strategic and financial benefits currently anticipated from the Acquisition, our stockholders will have experienced substantial dilution of their ownership interests without receiving any commensurate benefit or only receiving part of the commensurate benefit to the extent we are able to realize only part of the strategic and financial benefits currently anticipated from the Acquisition.

SVM is currently not a U.S. public reporting company and the obligations associated with integrating the operations related to the SVM Assets into a public company may require significant resources and management attention.

SVM is a private company that is not subject to public company reporting requirements and does not have accounting personnel specifically employed to review internal controls over financial reporting. As a public company, we are required to document and test our internal controls over financial reporting pursuant to Section 404(b) of the Sarbanes-Oxley Act of 2002, so that our management can certify as to the effectiveness of our internal control over financial reporting in connection with our annual report. The operations of the SVM Assets will be required to be included in the scope of our internal control over financial reporting in the annual report to be filed with the SEC for the fiscal year following the fiscal year in which the Closing occurs and thereafter, which will require us to make and document significant changes to our internal controls over financial reporting. Integrating these operations into our current compliance and accounting system and disclosure controls and procedures may increase our legal and financial compliance costs, make some activities more difficult, time-consuming or costly and increase demand on our systems and resources. Furthermore, the need to establish the necessary corporate infrastructure to integrate these operations may divert management’s attention from implementing our growth strategy. However, the measures we take may not be sufficient to satisfy our obligations as a public company. If we do not continue to develop and implement the right processes and tools to manage our enterprise and maintain our culture, our ability to compete successfully and achieve our business objectives could be impaired, which could negatively impact our business, financial condition and results of operations. In addition, we cannot predict or estimate the amount of additional costs we may incur to bring the SVM business into compliance with these requirements. We anticipate that these costs will materially increase our selling, general and administrative expenses. These additional obligations could have a material adverse effect on our business, financial condition, results of operations and cash flow.

We anticipate our indebtedness will increase upon completion of the Acquisition and may have the effect of heightening other risks we now face.

Upon completion of the Acquisition, we will have additional indebtedness and will be subject to increased risks associated with debt financing. The Closing is conditioned upon our receipt of $10.0 million in senior secured bridge financing from Nirma or its designated subsidiary (the “Bridge Facility”), which will be secured by substantially all of 5E SVM’s assets, guaranteed by the Company and accrue interest at a rate of 8.00% per annum, which will accrue and be payable in-kind and capitalized quarterly to the principal amount thereof. A portion of the Bridge Facility will be funded upon the Closing, with the remaining amount to be funded post-Closing upon satisfaction of specified conditions, and the Bridge Facility will mature 270 days after the Closing. The Bridge Facility will also include a $1.0 million transaction fee, which will be due at maturity. In addition, we will issue the Promissory Note as consideration, which will accrue interest at 14.5% per annum, payable in-kind and capitalized quarterly, will require a cash payment of approximately $1.2 million on the 24-month anniversary of its issuance date and will otherwise mature on the fifth anniversary of its issuance date.

Our increased indebtedness could have important consequences to holders of our Common Stock, including:

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requiring the use of cash or other resources to repay the principal amounts and accrued interest at maturity, thereby reducing our ability to use our cash flow to fund working capital, acquisitions, capital expenditures and general corporate requirements;

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putting us at a disadvantage compared to our competitors with less indebtedness.

In addition, under the Asset Purchase Agreement, we are required to post replacement surety bonds, letters of credit and other forms of financial assurance, and to substitute ourselves for SVM and Nirma with respect to all existing guarantee and indemnity obligations relating to the acquired business, within 12 months following the Closing. The cost and availability of such financial assurance instruments is not guaranteed, and our failure to post them within the required timeframe could result in regulatory consequences or the loss of permits necessary to operate the acquired business. In addition, under the terms of the Bridge Facility, the amount of any draw on the letters of credit maintained by SVM or Nirma in support of such obligations, and the face amount of any such letters of credit that remain outstanding 12 months after the Closing, will be added to the outstanding principal amount of the Bridge Facility.

The SVM Assets are being acquired on an “as is, where is” basis in a sale under section 363 of the Bankruptcy Code, and we will have limited or no post-closing recourse against SVM.

5E SVM is acquiring the SVM Assets on an “as is, where is” basis. The representations, warranties and pre-Closing covenants of SVM contained in the Asset Purchase Agreement will not survive the Closing of the Acquisition (other than in the case of intentional fraud), and the Asset Purchase Agreement does not provide for indemnification by SVM in favor of 5E SVM for any breach thereof. Covenants that by their terms contemplate performance after the closing will survive in accordance with their terms. As a result, following the Closing, we will have limited or no recourse against SVM with respect to the condition of the SVM Assets or any undisclosed liabilities, and we will bear the risk of any defects, deficiencies or liabilities associated with the SVM Assets that are not expressly covered by the Excluded Liabilities.

Although the SVM Assets are expected to be transferred free and clear of liens, claims and encumbrances pursuant to section 363 of the Bankruptcy Code, certain environmental, reclamation and regulatory obligations applicable to 5E SVM as the post-Closing owner and operator of the SVM Assets are expected to be expressly preserved under the Sale Order. These obligations include, among others, compliance with environmental laws of general applicability, obligations under orders issued by the California Lahontan Regional Water Board with respect to SVM’s Argus, Westend and Trona production facilities, as well as decommissioning and reclamation obligations under federal law with respect to Bureau of Land Management leases. The scope and cost of these obligations may be significant and are not fully quantifiable at this time.

The Sale Order, once entered, will remain subject to appeal until the applicable appeal period has expired. Any reversal, modification or vacatur of the Sale Order on appeal could adversely affect the protections afforded to us in connection with the Acquisition, including the free-and-clear transfer of the SVM Assets and the protections against successor liability claims. We have relied upon the anticipated final and binding nature of the Sale Order and the protections expected to be afforded by sections 363(f) and 363(m) of the Bankruptcy Code in agreeing to consummate the Acquisition.