Aqua Metals, Inc.
For the period ended Dec 31, 2024. Filed Mar 31, 2025.
View on SEC.govAbout this filing
A company's yearly report to the SEC, with audited financial statements. It is the fullest account a company gives of its business, its finances and the risks it sees.
FY2024 · Filed Mar 31, 2025
AQMS$1.26+7.3%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-K
Period ended 2023-12-31; filed 2024-03-28.
0001437749-24-009870
Item 7. Management’s Discussion and Analysis of Financial Condition and Results of OperationsCurrent report: 10-K
Period ended 2024-12-31; filed 2025-03-31.
0001437749-25-010177
Item 7. Management’s Discussion and Analysis of Financial Condition and Results of OperationsThe baseline is this issuer’s latest earlier reporting period of the same form that was filed before the current report. A previous 10-Q is a different quarter, not a year-over-year comparison. Amendments are excluded.
Compared 60 previous paragraphs and 66 current paragraphs.
28 unchanged; 27 reworded; 11 added; 5 removed; 0 previous and 0 current paragraphs rearranged.
Tables are not compared: 4 previous and 4 current tables excluded. Dates, whitespace, punctuation and numbering changes are ignored; changes to financial figures remain significant.
A changed paragraph is not evidence that risk increased or decreased. An unchanged paragraph does not establish that risk stayed the same.
Added paragraphs (11)
Current report
This breakthrough technology was initially applied in the lead acid battery (LAB) recycling industry, building the first integrated recycling system for breaking LAB and recovering pure metal. In 2019, we operated our demonstration AquaRefinery at commercial quantity production levels and produced over 35,000 ‘AquaRefined’ ingots operating twenty-four hours a day, seven days a week for sustained periods of time.
Current report
In February 2023, we acquired a five-acre parcel of land with an existing building to begin development of our Li AquaRefining recycling campus at TRIC. When fully developed, the facility we envision is designed to process lithium-ion battery material each year using our proprietary Li AquaRefining technology. Subject to our receipt of the required additional capital, we expect to complete development of phase one, including all equipment installation within 3-4 quarters of securing the additional capital and to complete the commissioning and scaling of this operation at the new campus within 2 quarters of completion of the development. The Company is planning for a phased development of the campus, beginning with the already commenced redevelopment of an existing building on-site into the first commercial-scale Li AquaRefinery.
Current report
In the first half of 2024, we made significant progress on the construction of the planned first phase of the commercial Li AquaRefinery and we continue to pursue the required funding for the completion of the phase one development of our five‑acre recycling campus through various sources, including debt, project finance, joint venture and strategic investment options. At the end of 2024, we completed the first multi-week continuous 7 days x 24 hours operation campaign at our pilot facility, demonstrating the ability to deliver exceptional recovery rates and produce battery-grade critical minerals.
Current report
In February 2025, the Company announced its expanded vision to more than double the output of lithium carbonate by deferring the plating of nickel and cobalt to metal form until the next phase. This allows for several improvements to the early years of scaling – reduced CAPEX by simplifying the product set to lithium carbonate and MHP (Mixed Hydroxide Precipitates), more volume of product due to the simplification, further de-risk with the simplified product set, more revenue and overall operating margins with a much improved payback on remaining capital to be financed. The Company continues to seek the funding to complete the Phase One.
Current report
Effective November 5, 2024, we effected a one-for-20 reverse stock split of our issued and outstanding common shares. All share and share price information set forth in this report has been adjusted retrospectively to reflect this reverse stock split.
Current report
We recognized interest expense of $574,000 for the year ended December 31, 2024 and $621,000 for the year ended December 31, 2023. The decrease was partially due to a reduction in the outstanding balance of the note payable during 2023.
Current report
For the year ended December 31, 2024, the Company recognized a change in fair value of warrant liability of $507,000, which was primarily due to the remeasurement of the warrants issued in December 2024.
Current report
Liability classified warrants are initially recorded at fair value and remeasured at each reporting date, with changes in fair value recognized in earnings. As of December 31, 2024, the Company had outstanding warrants classified as liabilities. These instruments are valued using the Monte-Carlo option pricing model utilizing several key assumptions, including share price volatility, the risk-free rate of return, the expected dividend yield and other warrant design features
Current report
For restricted stock unit awards with performance conditions, consisting of our supplemental retention awards granted on October 3, 2024, compensation cost is recognized in the period in which it becomes probable that the performance target will be achieved and represents the compensation cost attributable to the period for which the service or goods already have been provided. These awards are based on a fixed dollar amount settled in a variable number of shares and as a result are liability classified. The fair value of these awards is based on the fixed dollar amount dictated in the award agreements. As the Company has considered the performance conditions are not probable to be met as of December 31, 2024, no compensation cost has been recorded in the consolidated financial statements.
Current report
If at any point in time the Company does not currently have a sufficient quantity of shares authorized for issuance under their approved stock incentive plan, the Company has established a sequencing policy that shares are issued to grants with the earliest inception date first. When multiple grants have the same inception date, shares are first allocated to non-named executive officers, then to shares with satisfied market and performance conditions, and last to service-only grants made to named executive officers. Therefore, grants to named executive officers with service-only conditions with the latest grant date will be reclassified to liabilities first. For service-based grants, the value of grants required to be reclassified to liabilities will be re-measured on a periodic basis based on the closing fair market value of our common stock.
Removed paragraphs (5)
Previous report
In February 2023, we acquired a five-acre recycling campus at TRIC. When fully developed, the facility is designed, to process up to 10,000 tonnes of lithium-ion battery material each year using our proprietary AquaRefining technology. We expect to complete development of phase one, including all equipment installation, by the end second quarter 2024 and to commence operations at the new campus in the third quarter of 2024. Our initial plans call for upgrading the current building to install a commercial-scale Li AquaRefining system capable of recycling 3,000 tons of lithium battery ‘black mass’ each year. We expect to complete redevelopment of the current space and finalize equipment installation this year, and to commence operations at the new campus in the third quarter of 2024. The purchase of the new property was funded with a non-dilutive loan. We also intend to finance the development of Phase One through a non-dilutive loan. The Company is currently in discussions with a provider of debt financing that has provided financing in the past.
Previous report
We recognized interest expense of $621,000 for the year ended December 31, 2023 and $125,000 for the year ended December 31, 2022. The increase in interest expense from the prior year is due to the interest paid on the two loans secured in September 2022 and February 2023.
Previous report
Intangible and other long-lived assets
Previous report
The intangible assets consist of a patent application contributed to us by five founding stockholders, patent applications for technology developed by us and trademark applications. The useful life of the intangible assets has been determined to be ten years and the assets are being amortized. We periodically evaluate our intangible and other long-lived assets for indications that the carrying amount of an asset may not be recoverable. In reviewing for impairment, we compare the carrying value of such assets to the estimated undiscounted future cash flows expected from the use of the assets and their eventual disposition. When the estimated undiscounted future cash flows are less than their carrying amount, an impairment loss is recognized equal to the difference between the assets’ fair value and their carrying value. In addition to the recoverability assessment, we routinely review the remaining estimated lives of our long-lived assets. Any reduction in the useful life assumption will result in increased depreciation and amortization expense in the period when such determination is made, as well as in subsequent periods. We evaluate the need to record impairment during each reporting period. No impairment has been recorded. We determined that the estimated life of the intellectual property properly reflected the current remaining economic life of the asset.
Reworded paragraphs (27)
Previous wording
Aqua Metals is engaged in the business of applying its commercialized clean, water-based recycling technology principles to develop the clean and cost-efficient recycling solutions for both lead and lithium-ion (“Li”) batteries. Our recycling process is a patented hydro- and electrometallurgical technology that is a novel, proprietary and patented process we developed and named AquaRefining. AquaRefining is a low-emissions, closed-loop recycling technology that replaces polluting furnaces and hazardous chemicals with electricity-powered electroplating to recover valuable metals and materials from spent batteries with higher purity, lower emissions, and with minimal waste. The modular “Aqualyzers” cleanly generate ultra-pure metal one atom at a time, closing the sustainability loop for the rapidly growing energy storage economy.
Current wording
Aqua Metals is engaged in the business of applying its commercialized clean, water-based, recycling technology principles to develop cost-efficient recycling solutions for both lead and lithium-ion (“Li”) batteries. Our recycling process is a patented hydro and electrometallurgical technology that is an innovative, proprietary and patented process we developed and named AquaRefining. AquaRefining is a low-emissions, closed-loop recycling technology that has the potential to replace polluting furnaces and hazardous chemicals with electricity-powered electroplating to recover valuable metals and materials from spent batteries with higher purity, lower emissions, and with minimal waste. The modular “Aqualyzers” cleanly generate ultra-pure metal one atom at a time, closing the sustainability loop for the rapidly growing energy storage economy.
Previous wording
Our process was originally designed for lead recycling. Lead is a globally traded commodity with a worldwide market value in excess of $20 billion. We are also applying our commercialized clean, water-based recycling technology principles with the goal of developing the cleanest and most cost-efficient recycling solution for lithium-ion batteries. We believe our process has the potential to produce higher quality products at a lower operating cost without the damaging effects of furnaces and greenhouse emissions. Aqua Metals estimates the total addressable market for lithium-ion battery recycling will be approximately $9 billion by 2025 and grow to exceed lead battery recycling by the end of the decade.
Current wording
We are also applying our commercialized clean, water-based recycling technology principles with the goal of developing the cleanest and most cost-efficient recycling solution for lithium-ion batteries. We believe our process has the potential to produce higher quality products at a lower operating cost without the damaging effects of furnaces and greenhouse emissions.
Previous wording
During the first half of 2022, we announced our ability to recover copper, lithium hydroxide, nickel and cobalt from lithium-ion battery black mass at the Company’s Innovation Center. During 2022, we built our fully-integrated pilot system, located within the company’s Innovation Center, which is designed to allow Aqua Metals to be the first company in North America to recycle battery minerals from black mass and sell them in the U.S. and position the Company as the first LiB recycler in North America to align with the U.S. government’s goal of retaining strategic battery minerals within the domestic supply chain.
Current wording
During the first half of 2022, we announced our ability to recover copper, lithium hydroxide, nickel, and cobalt from lithium-ion battery ‘black mass’ at bench scale at the Company’s Innovation Center. During 2022, we built our fully-integrated pilot system, located within the Company’s Innovation Center, which is designed to allow Aqua Metals to be the first company in North America to recycle battery minerals from black mass, sell them in the U.S. and position the Company as the first LiB recycler in North America to align with the U.S. government’s goal of retaining strategic battery minerals within the domestic supply chain.
Previous wording
During 2022, we conducted environmental comparisons based on Argonne National Lab’s modeling of lithium battery supply chains – called EverBatt. The initial results indicate that AquaRefining is a cleaner approach to LiB recycling, producing far less CO2 waste streams than the two evaluated primary processes currently on the market which include smelting and chemically driven hydrometallurgical process. In December of 2022, we completed equipment installation and began to operate our first-of-a-kind LiB recycling facility, utilizing electricity to recycle instead of intensive chemical processes, fossil fuels, or high-temperature furnaces. In January of 2023, Aqua Metals recovered its first metals from recycling lithium batteries using the patent-pending Li AquaRefining process and is currently scaling operations at the Company’s pilot facility.
Current wording
During 2022, we conducted environmental comparisons based on Argonne National Lab’s modeling of lithium battery supply chains – called EverBatt. The initial results indicate that AquaRefining is a cleaner approach to LiB recycling, producing far less CO2 waste streams than smelting or chemical-driven hydrometallurgical processes currently on the market. In December 2022, we completed equipment installation and began to operate our first-of-a-kind LiB recycling facility, utilizing electricity as the catalyst to recycle instead of intensive chemical processes, fossil fuels, or high-temperature furnaces. In January 2023, Aqua Metals recovered its first metals from recycling lithium batteries using the patent-pending Li AquaRefining process.
Previous wording
During the year ended December 31, 2023, we issued 3,244,302 shares of common stock pursuant to an At the Market Issuance Sales Agreement ("ATM") for net proceeds of $3.8 million. We raised a net of $18.3 million in the third quarter of 2023 from the public offering of our common shares and a net of $4.6 million from the sale of our common stock to Yulho.
Current wording
During the year ended December 31, 2024, we issued 1,195,033 shares of common stock pursuant to an at the market issuance sales agreement ("ATM") for net proceeds of $5 million. On May 14, 2024, we completed a public offering of 1,006,250 shares of our common stock, at the public offering price of $7.80 per share. In connection with the sale of common stock, the Company issued warrants to purchase shares of common stock at the rate of one warrant for every share of purchased common stock, at the price of $0.20 per warrant. After the deduction of the underwriter’s discount and expenses payable by us, we received net proceeds of $7.3 million. During the year ended December 31, 2023, we issued 162,215 shares of common stock pursuant to an at the market issuance sales agreement for net proceeds of $3.8 million. We raised a net of $18.3 million in the third quarter of 2023 from the public offering of our common shares and a net of $4.6 million from the sale of our common stock to Yulho. In connection with the sale of common stock in 2023, the Company issued warrants to purchase 18,193 shares of the Company's common stock to the underwriter of the Company's public offering and the Company issued a warrant to purchase 10,288 shares of the Company's common stock to the placement agent of the transaction in connection with the Yulho transaction.
Previous wording
Our focus for the lead market is providing equipment and licensing of our lead acid battery recycling technologies in an enabler model which allows us to work with anyone in the industry globally and address the entire marketplace. Our focus for the lithium market includes operating our first-of-a-kind lithium battery recycling facility, utilizing electricity to recycle instead of intensive chemical processes, fossil fuels, or high-temperature furnaces. We are also exploring partnership and/or joint ventures agreements, particularly as our Li AquaRefining matures through 2024. We believe that Aqua Metals is in a position to become one of the few critical minerals recovery players for which our environmental and economic value proposition should generate both great commercial wins and potentially government grants to accelerate our credibility and progress.
Current wording
Our current focus is building and operating our first-of-a-kind lithium battery recycling facility, utilizing electricity to recycle instead of intensive chemical processes, fossil fuels, or high-temperature furnaces. We are also pursuing potential partnership and/or joint ventures agreements and licensing agreements, particularly as our Li AquaRefining continues to develop and improve. We believe that Aqua Metals is in a position to become one of the few critical minerals recovery players for which our environmental and economic value proposition should generate both great commercial wins and potentially government grants to accelerate our credibility and progress.
Previous wording
During the years ended December 31, 2023 and December 31, 2022, revenue resulted from the sale of inventory consisting of lead compounds that were generated during operation of our former TRIC facility. During the years ended December 31, 2023 and December 31, 2022, product sales consisted of lead bullion, lead compounds and plastics that were generated through the AquaRefining process. The following table summarizes results of operations with respect to the items set forth below for the twelve months ended December 31, 2023 and 2022 together with the percentage change from the twelve months ended December 31, 2022 for those items (in thousands).
Current wording
We did not engage in commercial operations in 2024 and 2023. Our operations have been devoted to developing our Li AquaRefining battery recycling technology. During the year ended December 31, 2023, revenue resulted from the sale of inventory consisting of lead compounds that were generated during operation of our former TRIC facility. The following table summarizes results of operations with respect to the items set forth below for the twelve months ended December 31, 2024 and 2023 together with the percentage change from the twelve months ended December 31, 2023 for those items (in thousands).
Previous wording
Plant operations includes supplies and related costs, salaries and benefits, consulting and outside services costs, depreciation and amortization costs, insurance, travel and overhead costs. Plant operations increase approximately $2,323,000 or 59% for the twelve months ended December 31, 2023, as compared to the twelve months ended December 31, 2022 as a result of an increase in payroll and payroll related fees of approximately $1,702,000, as we hired additional staff to operate the pilot facility, process black mass and build out of our commercial facility in addition to an increase of $482,000 in legal fees and other service costs.
Current wording
Plant operations includes supplies and related costs, salaries and benefits, consulting and outside services costs, depreciation and amortization costs, insurance, travel and overhead costs. Plant operations increased approximately $931,000 or 15% for the twelve months ended December 31, 2024, as compared to the twelve months ended December 31, 2023. This increase was primarily driven by a $758,000 rise in payroll and related fees, as we hired additional staff to operate the pilot facility, process black mass and build out of our commercial facility during the first seven months of the year in addition to an increase of $173,000 in insurance and other service costs. In August 2024, the Company announced that due to a delay in funding, it has completed a reduction in force of personnel hired largely in expectation of securing the required funding for the completion of the Sierra ARC and commencement of operation. We expect payroll costs to be lower until funding is received and operations resume.
Previous wording
Research and development cost includes expenditures related to the improvement of the AquaRefining technology and the development of our lithium-ion battery recycling process. During the twelve months ended December 31, 2023, research and development costs decreased approximately $72,000 or 4% from the comparable period in 2022. Research and development is a key part of our business strategy and includes our focus on improving the Company's proprietary technology for LAB recycling and advancing our research related to the application of AquaRefining to recycling lithium-ion batteries. The decrease was driven by moving our focus from R&D to operating our fully integrated pilot system at the Innovation Center and build out of our commercial facility.
Current wording
Research and development cost includes expenditures related to the improvement of the AquaRefining technology and the development of our lithium-ion battery recycling process. During the twelve months ended December 31, 2024, research and development costs decreased approximately $154,000 or 9% from the comparable period in 2023. Research and development is a key part of our business strategy and includes our focus on improving the Company's proprietary technology for LAB recycling and advancing our research related to the application of AquaRefining to recycling lithium-ion batteries. The decrease was driven by a reduction in payroll and payroll related fees of approximately $159,000, as we completed a reduction of force during August 2024.
Previous wording
For the year ended December 31, 2023, we recognized a non-cash impairment charge of $4,851,000, subsequent to an analysis of our investment and construction in progress ("CIP") with regard to our investment in LINICO and ACME Metals. We recognized a loss on the investment in LINICO of approximately $1,400,000 during the year ended December 31, 2023 as the result of the sale of our LINICO common stock to LINICO's parent Comstock Inc., for $600,000 payable in twelve equal monthly installments commercing in January 2024. In addition, we recognized a loss of $3,451,000 million related to the ACME CIP as a result of the suspension of the development of recycling operations at the ACME Metals Taiwanese facility. During 2023, management has shifted focus away from the original service under the ACME lead recycling license agreement to a new primary focus on the Lithium recycling business as a Company. As a result, management sees a decrease in the utilization of the ACME plant and its related operations, and assessed that the future expected cash flows connected with ACME are at or near zero. For the year ended December 31, 2022, we recognized a write down to fair market value of our assets held for sale of approximately $579,000. We recorded a gain of $700,000 that resulted from the write-off of plant commitment accrued expenses and $100,000 gain that resulted from the sale of CIP equipment. The gain was offset by a loss on the sale of assets held for sale of approximately $100,000 and $100,000 bad debt resulting from the sale of the battery breaker.
Current wording
For the year ended December 31, 2024, we recognized a non-cash impairment charge of $2,640,000 for impairment on equipment deposits due to the change in our recycling strategy by prioritizing mixed hydroxide precipitate, to accelerate commercialization and reduce remaining capital requirements to complete Phase One build-out of our recycling campus at TRIC. For the year ended December 31, 2023, we recognized a non-cash impairment charge of $4,851,000, subsequent to an analysis of our investment and construction in progress ("CIP") with regard to our investment in LINICO and ACME Metals. We recognized a loss on the investment in LINICO of approximately $1,400,000 during the year ended December 31, 2023 as the result of the sale of our LINICO common stock to LINICO's parent Comstock Inc., for $600,000 payable in twelve equal monthly installments commencing in January 2024. In addition, we recognized a loss of $3,451,000 related to the ACME CIP as a result of the suspension of the development of recycling operations at the ACME Metals Taiwanese facility. During 2023, management shifted focus away from the original service under the ACME lead recycling license agreement to a new primary focus on the Lithium recycling business as a Company. As a result, management projected a decrease in the utilization of the ACME plant and its related operations, and assessed that the future expected cash flows connected with ACME are at or near zero.
Previous wording
We recognized a gain on disposal of property, plant and equipment of approximately $23,000 during the twelve months ended December 31, 2023 compared to a gain of $596,000 for the twelve months ended December 31, 2022. For the twelve months ended December 31, 2022, the gain on property, plant and equipment resulted from the write-off of plant commitment accrued expenses. Plant clean-up and repair of fire damaged areas were completed by the end of June 30, 2022.
Current wording
We recognized a loss on disposal of property, plant and equipment of approximately $440,000 during the twelve months ended December 31, 2024 compared to a gain of $23,000 for the twelve months ended December 31, 2023.
Previous wording
General and administrative expense increased approximately $1,823,000, or 19%, for the twelve months ended December 31, 2023 compared to the twelve months ended December 31, 2022. The increase in general and administrative expenses for the the twelve months ended December 31, 2023 includes $1,237,000 in payroll and payroll-related expenses, as well as an increase of $780,000 in travel-related expenses, advertising and promotion expenses, and overhead expenses, offset by a $300,000 decrease in professional fees.
Current wording
General and administrative expense increased approximately $329,000, or 3%, for the twelve months ended December 31, 2024 compared to the twelve months ended December 31, 2023. The increase in general and administrative expenses for the twelve months ended December 31, 2024 was primarily driven by higher professional fees associated with our efforts to raise capital.
Previous wording
For the year ended December 31, 2023 and December 31, 2022, and we recorded approximately $1,147,000 and $262,000 in interest and other income, respectively, an increase of $885,000 or 338%. The $513,000 increase in interest and $242,000 in other revenue is attributable to increased interest on our bank deposits and miscellaneous income from a non-recurring engineering arrangement with 6K Energy, respectively.
Current wording
For the year ended December 31, 2024 and December 31, 2023, and we recorded approximately $376,000 and $1,147,000 in interest and other income, respectively, a decrease of $771,000 or 67%. The decrease in interest and other revenue is attributable to decreased interest on our bank deposits and the conclusion of our non-recurring engineering arrangement with 6K Energy at the end of 2023.
Previous wording
As of December 31, 2023, we had total assets of $33.6 million and working capital of $13.7 million.
Current wording
As of December 31, 2024, we had total assets of $26,365,000 and working capital deficit of $(3,538,000).
Previous wording
Net cash used in operating activities for the years ended December 31, 2023 and December 31, 2022 was approximately $3.2 million and $10.1 million, respectively. Net cash used in operating activities during each of these periods consisted primarily of our net loss adjusted for non-cash items such as depreciation, amortization, and stock-based compensation charges as well as net changes in working capital. During the year ended December 31, 2023, we recognized $12.3 million proceeds from sales and leasing of building to LINICO, $1.4 million expense for impairment on LINICO investment and approximately $3.5 million expense for impairment on ACME CIP. During the year ended December 31, 2022, we recognized a $0.6 million gain on disposal of property and equipment and approximately $0.6 million expense for impairment on assets held for sale.
Current wording
Net cash used in operating activities for the years ended December 31, 2024 and December 31, 2023 was approximately $13,632,000 and $3,193,000, respectively. Net cash used in operating activities during each of these periods consisted primarily of our net loss adjusted for non-cash items such as depreciation, amortization, and stock-based compensation charges as well as net changes in working capital. During the year ended December 31, 2024, we recognized approximately $2,640,000 expense for impairment on equipment deposits due to the change in our recycling strategy by prioritizing mixed hydroxide precipitate, to accelerate commercialization and reduce remaining capital requirements to complete Phase One build-out of our recycling campus at TRIC. During the year ended December 31, 2023, we recognized $12,278,000 proceeds from sales and leasing of building to LINICO, $1,400,000 expense for impairment on LINICO investment and approximately $3,451,000 expense for impairment on ACME CIP.
Previous wording
Net cash used in investing activities for the year ended December 31, 2023 was $9.8 million compared to $3.4 million for the year ended December 31, 2022. During these periods, net cash in investing operations primarily includes fixed asset acquisitions, deposits for future fixed asset purchases and proceeds received from sale of equipment, respectively.
Current wording
Net cash used in investing activities for the year ended December 31, 2024 was $11,636,000 compared to $9,813,000 for the year ended December 31, 2023. During these periods, net cash in investing operations primarily includes fixed asset acquisitions, deposits for future fixed asset purchases and proceeds received from sale of equipment, respectively. During the year ended December 31, 2024, we received $500,000 from the note receivable with LINICO.
Previous wording
Net cash provided by financing activities for the year ended December 31, 2023 consisted of $3.8 million in net proceeds from the sale of Aqua Metals shares pursuant to the at-the-market offering, or ATM, $2.9 million in net proceeds from the loan agreement secured with the Summit Investment Services, LLC, $18.3 million in net proceeds from our July 2023 public offering and $4.6 million in net proceeds from the Yulho transaction, offset by the $6 million used to pay off the note payable as noted in Note 13 and by $1.1 million related to tax withholdings to cover RSU vesting . Net cash provided by financing activities for the year ended December 31, 2022 consisted of $6.5 million net proceeds from ATM shares sales and $5.9 million net proceeds from the loan we secured in September 2022.
Current wording
Net cash provided by financing activities for the year ended December 31, 2024 consisted of $5,014,000 in net proceeds from the sale of Aqua Metals shares pursuant to the at-the-market offering, or ATM, $1,500,000 in net proceeds from the loan agreement entered into on December 18, 2024, and $7,306,000 in net proceeds from our May 2024 public offering, offset by $552,000 related to tax withholdings to cover RSU vesting and $424,000 related to debt issuance costs. Net cash provided by financing activities for the year ended December 31, 2023 consisted of $3,786,000 in net proceeds from the sale of Aqua Metals shares pursuant to the at-the-market offering, or ATM, $2,931,000 in net proceeds from the loan agreement secured with Summit Investment Services, LLC, $18,318,000 in net proceeds from our July 2023 public offering and $4,629,000 in net proceeds from the Yulho transaction, offset by the $6,000,000 used to pay off the note payable and by $1,092,000 related to tax withholdings to cover RSU vesting.
Previous wording
As of December 31, 2023, we had total cash of $16.5 million and working capital of $13.7 million. As of the date of this report, we believe that we will require additional capital in order to fund our current level of ongoing costs over the next twelve months and move forward with our current business strategy. There can be no assurance that we will be able to acquire the necessary funding on commercially reasonable terms orat all. We intend to seek funds through the sale of equity or debt financing. Funding that includes the sale of our equity may be dilutive. If such financing is not available on satisfactory terms, we may be unable to further pursue our business plan and we may be unable to continue operations.
Current wording
As of December 31, 2024, we had total cash of $4,079,000 and working capital deficit of $(3,538,000). As of the date of this report, we believe that we will require additional capital in order to fund our current level of ongoing costs over the next twelve months and move forward with our current business strategy. There can be no assurance that we will be able to acquire the necessary funding on commercially reasonable terms orat all. We intend to seek funds through the sale of equity or debt financing. Funding that includes the sale of our equity may be dilutive. If such financing is not available on satisfactory terms, we may be unable to further pursue our business plan and we may be unable to continue operations.
Previous wording
We periodically evaluate our property, plant and equipment assets for indications that the carrying amount of an asset may not be recoverable. During the year 2023, management has shifted focus away from the original service under the license agreement (Lead business) to a new focus (Lithium business) as a Company. As such, management sees a decline in the utilization of the ACME plant and it’s related operations. At December 31, 2023, we recognized write down of approximately $3,451,000 million to equipment under construction that was not yet capitalized related to the ACME CIP as a result of the suspension of the development of recycling operations at the ACME Metals Taiwanese facility. As of December 31, 2022, management compared the carrying value of the assets held for sale against current fair market values. We determined the carrying value needed to be reduced to align with current fair market values. At December 31, 2022, we recognized write down on the assets held for sale to fair market value and $579,000.
Current wording
We periodically evaluate our property, plant and equipment assets for indications that the carrying amount of an asset may not be recoverable. At December 31, 2024, we recognized an impairment of approximately $2,640,000 for impairment on equipment deposits due to the change in our recycling strategy by prioritizing mixed hydroxide precipitate, to accelerate commercialization and reduce remaining capital requirements to complete Phase One build-out of our recycling campus at TRIC. The Company does not expect further impairments on remaining deposit amounts as this equipment is needed in the current plant design. During the year 2023, management shifted focus away from the original service under the license agreement (Lead business) to a new focus (Lithium business) as a Company. As such, management projected a decline in the utilization of the ACME plant and it’s related operations. At December 31, 2023, we recognized an impairment of approximately $3,451,000 to equipment under construction that was not yet capitalized related to the ACME CIP as a result of the suspension of the development of recycling operations at the ACME Metals Taiwanese facility.
Previous wording
The Company classifies common stock purchase warrants as equity if the contracts (i) require physical settlement or net-share settlement or (ii) give the Company a choice of net-cash settlement or settlement in its own shares (physical settlement or net-share settlement). The Company classifies any contracts that (i) require net-cash settlement (including a requirement to net cash settle the contract if an event occurs and if that event is outside the control of the Company), (ii) give the counterparty a choice of net-cash settlement or settlement in shares (physical settlement or net-share settlement), or (iii) contain reset provisions as either an asset or a liability. The Company assesses classification of its freestanding derivatives at each reporting date to determine whether a change in classification between equity and liabilities is required.
Current wording
The Company evaluates all freestanding warrants to determine whether they should be classified as equity or liability or asset instruments in accordance with ASC 815-40. The Company classifies common stock purchase warrants as equity if the contracts (i) require physical settlement or net-share settlement or (ii) give the Company a choice of net-cash settlement or settlement in its own shares (physical settlement or net-share settlement). The Company classifies any contracts that (i) require net-cash settlement (including a requirement to net cash settle the contract if an event occurs and if that event is outside the control of the Company), (ii) give the counterparty a choice of net-cash settlement or settlement in shares (physical settlement or net-share settlement), or (iii) contain reset provisions as either an asset or a liability. Additionally, warrants that include variable settlement provisions triggered by a change in control are classified as liabilities. The Company assesses classification of its freestanding derivatives at each reporting date to determine whether a change in classification between equity and liabilities is required.
Previous wording
The value of the common stock purchase warrants are estimated using the Black-Scholes pricing model.
Current wording
The value of the equity classified common stock purchase warrants are estimated as of the issuance date using the Black-Scholes pricing model.
Previous wording
We recognize compensation expense for stock-based compensation in accordance with ASC 718 “Compensation – Stock Compensation.” For employee stock-based awards, we calculate the fair value of the award using the closing price of the common stock on date of grant date. For stock-options we calculate the fair value of the award on the date of grant using the Black-Scholes-Merton method; the expense is recognized over the service period for awards to vest.
Current wording
We recognize compensation expense for stock-based compensation in accordance with ASC 718 “Compensation – Stock Compensation.” For employee restricted stock units, we calculate the fair value of the award using the closing price of the common stock on date of grant date.
Previous wording
For stock price hurdle restricted share units the fair value of the award is calculated on the date of grant using a Monte Carlo simulation model utilizing several key assumptions, including share price volatility, the risk-free rate of return, the expected dividend yield and other award design features.
Current wording
For restricted stock unit awards with market conditions the fair value of the award is calculated on the date of grant using a Monte Carlo simulation model utilizing several key assumptions, including share price volatility, the risk-free rate of return, the expected dividend yield and other award design features.
Previous wording
As of December 31, 2023, we and our subsidiaries had outstanding $2,958,000 amount of indebtedness, net of issuance costs, $285,000 interest-only payments are due in the succeeding 12 months. As of December 31, 2023, our total minimum lease payments was $283,000, of which all is due in the succeeding 12 months. For details regarding our indebtedness and lease obligations, refer to Note 12, Leases, and Note 13, Note payable, to the consolidated financial statements included elsewhere in this Annual Report on Form 10-K.
Current wording
As of December 31, 2024, we and our subsidiaries had outstanding $4,500,000 amount of indebtedness and approximately $408,000 interest payments due in the succeeding 12 months. As of December 31, 2024, our total minimum future lease payments were $338,000, due in the succeeding 12 months. For details regarding our indebtedness and lease obligations, refer to Note 10, Leases, and Note 11, Note payable, to the consolidated financial statements included elsewhere in this Annual Report on Form 10-K.
Previous wording
We currently have two operating leases for real estate. We lease our Reno and McCarran, Nevada spaces under non-cancelable operating leases. The Reno, Nevada lease expires in 2024. The initial lease term for our mixed office and warehouse space in McCarran, Nevada expired on December 31, 2021. We elected to exercise our first extension option provided for in the McCarran, Nevada lease agreement, which extended the current term of the lease to December 31, 2024.
Current wording
We currently have two operating leases for real estate. We lease our Reno and McCarran, Nevada spaces under non-cancelable operating leases. We elected to exercise our first extension option provided for in the Reno, Nevada lease agreement, which extended the current term of the lease to April 1, 2026. The initial lease term for our mixed office and warehouse space in McCarran, Nevada expired on December 31, 2021. We elected to exercise our second extension option provided for in the McCarran, Nevada lease agreement, which extended the current term of the lease to December 31, 2027.
Previous wording
We currently maintain one finance lease for equipment. In November 2021, we entered into a finance lease for a modular laboratory which expires in October of 2024.
Current wording
We currently maintain one finance lease for equipment. On April 1, 2024 the Company entered into a finance lease for laboratory equipment which expires in 2029.
Previous wording
Aqua Metals Reno, Inc. entered into a $3,000,000 loan agreement with Summit Investment Services, LLC, a Nevada limited liability company (the “Lender”) on February 1, 2023. See Note 13 in the accompanying notes to the consolidated financial statements for additional information.
Current wording
Aqua Metals Reno, Inc. entered into a $3,000,000 loan agreement with Summit Investment Services, LLC, a Nevada limited liability company (the “Lender”) on February 1, 2023 and due on April 27, 2025. On December 18, 2024, Aqua Metals, Inc. entered into a Securities Purchase Agreement with eight accredited investors in connection with a private placement of secured promissory notes (“Notes”) in the aggregate principal amount of $1,500,000 and common stock purchase warrants (“Warrants) to purchase 750,000 shares of the Company’s common stock. See Note 11 in the accompanying notes to the consolidated financial statements for additional information.