Aqua Metals, Inc.

Background

Aqua Metals was incorporated in Delaware on June 20, 2014, to develop and commercialize metals recycling technologies based on its proprietary AquaRefining process. In 2015, the Company developed its initial AquaRefining technology for lead-acid battery recycling, and between 2017 and 2019 operated a demonstration facility that achieved sustained production of recycled lead using a smelterless process.

In 2021, the Company expanded its focus to lithium-ion battery recycling following the development of intellectual property applicable to lithium battery materials. The Company established its Innovation Center in the Tahoe-Reno Industrial Center (“TRIC”) to support research, development, and pilot-scale operations.

During 2022 and 2023, Aqua Metals demonstrated bench-scale and pilot-scale recovery of lithium, nickel, cobalt, copper, and manganese from lithium-ion battery black mass. The Company constructed and commissioned an integrated pilot system at its Innovation Center and began operating the system using an electricity-based process rather than high-temperature furnaces or conventional chemical refining methods.

In late 2024, the Company completed a multi-week continuous 24-hour operating campaign at its pilot facility. In 2025, Aqua Metals refined its commercialization strategy to prioritize a simplified product slate, including lithium carbonate and mixed hydroxide precipitate (“MHP”), with the objective of reducing capital requirements, improving early-stage operating economics, and accelerating deployment timelines.

During 2025, the Company also evaluated changes to its capital allocation strategy, including the sale of previously acquired real estate intended for a recycling campus, and continued to assess alternative sites and funding sources for future commercial facilities.

In parallel, Aqua Metals expanded its evaluation of additional feedstocks and applications for its technology, including exploratory initiatives related to polymetallic nodules and other sources of critical minerals. These activities remain in the evaluation stage and are intended to assess technical and economic feasibility.

Effective November 5, 2024, the Company effected a one-for-20 reverse stock split of its issued and outstanding common shares. Subsequently, on August 4, 2025, the Company effected a one-for-10 reverse stock split of its issued and outstanding common shares. All share and share price information set forth in this report have been adjusted retrospectively to reflect these reverse stock splits.

Unless otherwise indicated, the terms “Aqua Metals,” “Company,” “we,” “us,” and “our” refer to Aqua Metals, Inc. and its wholly owned subsidiaries.

Overview

Aqua Metals is developing and seeking to commercialize proprietary recycling and refining technologies for the recovery of critical minerals and metals. Its patented and patent-pending AquaRefining™ process is an electro-hydrometallurgical method designed to recover high-purity materials from battery and other metal-bearing feedstocks using a closed-loop system powered by electricity. This approach is intended to reduce CAPEX and OPEX costs, reduce emissions, hazardous waste, and reliance on conventional smelting and chemical-intensive refining processes.

Since 2015, the Company has advanced AquaRefining as a platform technology for metals recovery. Aqua Metals initially focused on lead recycling and has since expanded its technology to address lithium-ion battery recycling and other critical mineral applications. The Company believes its process can enable the domestic recovery of materials such as lithium, nickel, cobalt, copper, and manganese for reuse in battery manufacturing and other industrial supply chains.

Aqua Metals operates its Innovation Center and pilot-scale lithium-ion battery recycling facility in the Tahoe-Reno Industrial Center (“TRIC”) in Nevada. At this facility, the Company has demonstrated recovery of multiple battery materials from black mass and other feedstocks and has conducted continuous operating campaigns to validate system performance. The Company is currently focused on further advancing its technology, qualifying products, and evaluating commercial deployment opportunities, including site selection, strategic partnerships, and financing alternatives. The Company has not yet commenced large-scale commercial lithium-ion battery recycling operations.

In addition to lithium-ion battery recycling, Aqua Metals continues to evaluate the application of its technology to other feedstocks and recycling streams, including emerging battery chemistries and alternative sources of critical minerals and rare earth materials. These efforts are intended to expand the potential applicability of the AquaRefining platform and support long-term commercial flexibility.

Our Markets

Aqua Metals’ AquaRefining process produces high purity metals and alloys that can be returned into the battery manufacturing supply chain or sold into metals markets for use across various advanced manufacturing industries. This combination of approaches and the broad applicability of the end products we aim to produce enables Aqua Metals to create low-emissions inputs for the battery supply chain or to help decarbonize other sectors that utilize these critical metals and superalloys – creating a more resilient and adaptable business model for the Company as a whole.

Metals Markets

Most of the minerals and metals that can be recovered in the recycling of batteries of various chemistries are also globally traded commodities. Lead, copper, cobalt, nickel, and other metals can be recovered and sold in pure metal form into these markets at the prevailing price or sold directly to a customer at a price set relative to the current market price.

For example, battery metals are globally traded metal commodities. Metals such as lead for LABs and nickel, cobalt, copper, and lithium for LIBs are the essential components for the world’s rechargeable batteries. These metals are globally traded primarily on the London Metals Exchange (LME) and the Shanghai Metals Exchange (SHME) in China also trades these elements. In their pure forms, the other minerals that Aqua Metals intends to recover from spent batteries can be sold into these global markets. Unlike lead markets where recycled mineral content achieves up to 90% of new LAB batteries in a mature industry, lithium and related metals recycling currently achieves only 1-3% recycled mineral content of new LiB batteries, relying almost entirely on newly mined ore and refining to meet global demand.

As noted above, although metals are traded as a commodity on the various global exchanges, the major sales are directly between producers/traders and users (whom are typically battery manufacturers). The LME daily price is used as the benchmark in forming the basis of physical trades, forward contracts, and hedge strategies for both primary and secondary metals, in metal form. Based on market and product knowledge with buyers of metals in the U.S. and global metals markets, different grades (termed alloys) of metal are traded at a premium to the base LME price. Metal alloys, which are typically designed specifically for the customer, are also sold at a premium above the base LME, whereas byproducts (generally lower purity, compounds, or scrap) are traded at a discount to the LME as they are based on the underlying metals content and its form.

The Lithium Battery Market

According to industry estimates, global demand for lithium-ion batteries is expected to increase significantly over the next decade. Global battery demand is projected to grow from approximately 2 terawatt-hours ("TWh") in 2025 to around 4.2 TWh by 2030, and potentially reaching about 6.8 TWh by 2035 (Figure 1 below). Batteries used in mobility applications, such as electric vehicles ("EVs"), are expected to remain the largest driver of battery demand and may represent approximately 85% of projected battery demand by 2035. In addition, grid-scale battery energy storage systems (“BESS”) are expected to represent one of the fastest-growing segments of battery demand.

Figure 1: Global battery demand and market split

Industry studies also indicate that demand for battery energy storage systems (“BESS”) is increasing significantly. Global installed BESS capacity is projected to grow at an annual rate of approximately 50% through 2030 and could reach between 500 and 700 gigawatt-hours (“GWh”) by that time (Figure 2). The global BESS market is expected to continue expanding rapidly, with projected market value estimates ranging from approximately $120 billion to $150 billion by 2030.

Rapid growth in BESS deployments is becoming an increasingly important driver of battery demand in the United States, alongside continued electric vehicle adoption. In 2024, energy storage installations reached approximately 37.1 GWh, and installations were projected to exceed 50 GWh in 2025.

Recent U.S. legislation has generally maintained incentives supporting energy storage deployment while introducing additional domestic sourcing requirements for certain battery materials, which may further encourage localization of battery supply chains.

To support projected battery demand, industry forecasts suggest that more than one hundred additional battery manufacturing facilities may need to be constructed globally by 2030. While mining currently represents the primary source of battery materials, recycling is expected to become an increasingly important secondary supply source. Although recycled materials are expected to represent a relatively small portion of battery inputs prior to 2030, recycling volumes are expected to increase significantly in the following decade as larger quantities of manufacturing scrap and end-of-life batteries become available for processing.

Figure 2: Global annually installed BESS capacity

Lithium Batteries

EV batteries are powered by a battery pack made up of individual cells. Each cell has 4 components: the cathode, anode, separator, and electrolyte. Lithium-ion batteries use different raw materials for each of the components. The most common material used for the anode is graphite. The most widely used metal for the cathode is metal oxides that are combinations of lithium, cobalt, nickel, manganese, and aluminum. The electrolyte is generally made using acidic salts and solvents such as sulfuric acid and there are also solid-state silicon-based alternatives under development and early deployments have begun. The separator is usually created using a porous, polyolefin material like polyethylene or polypropylene.

Lithium-ion battery recycling is the method of taking EV batteries and splitting it into its components, ultimately into the original raw materials (lithium, nickel, cobalt, etc.) that can be reused in new batteries. While making lithium-ion batteries for EVs it is important to address climate change, the batteries themselves are harmful to the environment if left in landfills or burned. Currently, only a small fraction of lithium-ion batteries are recycled and that must get close to 100% both to avoid environmental issues and to recapture the critical minerals in those spent batteries to feed the massive demand growth curve. Battery recycling helps address this problem, but current pyro-based battery recycling technology (smelting) also creates harmful emissions, potentially creating new climate problems faster than they are being solved. There are alternative hydro-based technologies available and rely on older methodologies that are known to create significant waste streams, potentially with more waste than product recovered, which have their own negative environmental and economic impacts.

Black Mass

Lithium-ion batteries are comprised of valuable metals such as lithium, copper, manganese, cobalt, and nickel. Once a battery is retired, the batteries can be collected, fully discharged, then shredded and base metals are separated to prepare them for recycling. This shiny, metallic mixture is what is called ‘black mass’—and it contains all the valuable metals that make up battery anodes and cathodes, the most expensive parts of a battery and the companies that collect and process batteries into black mass are referred to as ‘shredders’. The typical black color is due to the high concentrations of graphite contained in the anodes of batteries, which has a very dark black color. Black mass makes up about 40-50% of the total weight of an EV battery. Materials like the binder, copper, electrolytes, plastics, aluminum, and steel have been physically separated out by shredders before being recycled.

There are two main processes to producing black mass:

Aqua Metals specifically partners with producers that use non-pyro processes in order to create black mass to meet their own objectives for creating low-carbon recycled materials. The exact composition of black mass can vary considerably based on a number of factors. To start, there are many different types of lithium-ion batteries and manufacturing scrap forms, which will revert back to a mix of different elements and different ratios, including lithium, nickel, iron, titanium, copper, cobalt, manganese, and others (their use of lithium is the commonality).

Each manufacturer also has their own specific ‘recipe’ for their cathodes, cell type/form factors, as well as module type and pack assembly for different applications (cell phones, laptops, electric vehicles, etc.). Currently, the most popular types of lithium-ion batteries in the world incorporate significant amounts of nickel, cobalt, lithium, and manganese—so black mass produced today will typically have varying concentrations of each.

AquaRefining Process

We developed AquaRefining to be a cleaner and modular alternative to smelting and chemical-based recycling methods. Our process has two key elements, both of which are integral to our issued patents and pending-patent applications. The first is our use of proprietary, non-toxic solvents that dissolves metal compounds. The second is a proprietary electrochemical process and our modular Aqualyzer cells that selectively target each critical element and converts the dissolved metal compounds into high purity metals and/or salts.

The AquaRefining process begins with the processing of crushed used batteries either in the form of paste (for LAB) or, black mass (for LIB). The active materials are first processed to remove sulfur and then dissolved in our solvent. Metals are plated from the solvent using our patented and patent-pending process allowing the solvent to be reused.

We have demonstrated at bench scale and subsequently in our pilot facility that our lithium battery AquaRefining process can generate cobalt, lithium hydroxide or carbonate, copper, nickel, and manganese dioxide from lithium-ion battery black mass. A significant benefit of our AquaRefining process is that it can produce higher yields of higher purity, and thus higher value product than that derived from primary smelters with product from secondary sources.

Another significant benefit of our process is that we designed our AquaRefining equipment to be manufactured on a purpose-built production line in standard sized Aqualyzers. This is not possible with the smelting process, as smelters need to be constructed on site. This gives us the ability to provide AquaRefining systems with varying capacities to meet the specific needs of potential customers and suppliers. We have also developed an integrated software and portal called PureMetrics that keeps track of production and key operating metrics.

Recycling is subject to a variety of domestic and international regulations related to hazardous materials, emissions, employee safety and other matters. While our operations will be subject to these regulations, we believe that one of our potential advantages will be our ability to conduct battery recycling operations with less regulatory cost and burden than smelting operators due to the nature of our process. One of our key initiatives is and will continue to be, to educate regulators and the public as to the environmental benefits of AquaRefining. We believe that we have the potential to develop a business model that offers the opportunity to conduct, in an environmentally friendly manner, an important recycling activity that historically has been conducted in an often highly polluting manner.

Our Business Model

The market for lithium-ion batteries is global in scale but local in nature and execution, with large differences in local regulation, custom and practice, and access to transportation and electricity costs. In some regions, it is highly regulated, and in others it is not. Consequently, we are evolving our business model to commercialize our technology optimally across multiple locations.

Aqua Metals is applying its water-based recycling technology to develop cleaner and more cost-efficient recycling solutions for lithium-ion (“Li”) batteries. Our patented AquaRefining process is a hydrometallurgical and electrochemical technology designed to recover valuable metals and materials from spent batteries using a low-emissions, closed-loop system powered by electricity rather than furnaces and chemical-intensive processes. We believe AquaRefining can produce high-purity recovered materials with lower emissions and reduced waste compared to conventional recycling methods.

We are focused on advancing this technology for lithium-ion battery recycling, with the goal of recovering lithium hydroxide or lithium carbonate, copper, nickel, cobalt, and other compounds in forms that can be sold into battery supply chains or broader commodities markets. We believe the market for lithium-ion battery recycling will continue to grow significantly as demand increases for battery materials used in electric vehicles, data centers, and stationary energy storage, while recycling infrastructure remains underdeveloped relative to future needs.

Our strategy is to commercialize Li AquaRefining through the development and operation of recycling facilities, as well as through potential licensing, joint ventures, and strategic partnerships. Since 2023, we have operated our Li AquaRefining pilot plant at our Innovation Center, where we have demonstrated recovery of key battery minerals and continue to advance product quality, process performance, and commercial readiness.

As our lithium-ion recycling platform matures, we are also evaluating different commercialization pathways and geographic markets, recognizing that battery recycling is influenced by regional differences in regulation, infrastructure, transportation, and energy costs. We believe this flexible approach will support broader deployment of our technology over time.

Proposed Acquisition of Lion Energy, LLC

On February 6, 2026, the Company entered into a non-binding term sheet with Lion Energy, LLC (“Lion Energy”) contemplating the acquisition of all of the outstanding equity interests of Lion Energy, subject to the negotiation and execution of definitive agreements and the satisfaction of customary closing conditions. Under the terms of the contemplated transaction, consideration would consist of a combination of the Company’s common stock and contingent common stock earn-out consideration based on post-closing revenue and EBITDA performance. The proposed transaction remains subject to, among other things, completion of due diligence, execution of definitive agreements, required regulatory and stockholder approvals, and other customary closing conditions. There can be no assurance that a definitive agreement will be executed or that the transaction will be completed. The acquisition aims to expand the Company’s participation in energy storage systems, energy management software, and battery cell production through a equity stake in American Battery Factory upon closing. For additional information, see Note 19 — Subsequent events to the consolidated financial statements included in this report.

Certain outstanding warrants of the Company contain provisions that may provide holders with adjustment rights in connection with certain corporate transactions. The Company is evaluating whether the proposed acquisition of Lion Energy, LLC would have any impact under the terms of the applicable warrant agreements.

Competition

Our development of recycling technology for lithium-ion batteries is a unique approach to extracting the high-value metals compared to the array of other potential solutions under development. Currently, smelting is the only commercially proven process for recycling lithium-ion batteries. The smelting process utilizes multiple high emissions steps with low yields to produce materials that typically require further refining before being utilized to manufacture new batteries. Over the next decade and beyond, when the volume of used batteries becomes significant, smelting will likely not be a viable solution due to the negative environmental impact and likelihood of regulatory restrictions on emissions. The other technologies currently under development utilize a predominately hydrometallurgical approach that consumes significant amounts of chemicals to extract the metals resulting in high cost and excessive waste streams. Our approach is a hybrid of hydrometallurgical and electrometallurgical processes like the process we have commercialized for lead, we call it “Li AquaRefining.” We believe that Li AquaRefining, as demonstrated through our lab-scale, bench-scale, and now pilot-scale operations, requires fewer chemicals, generates less waste, and produces higher-purity products at a lower cost compared to both smelting and standard hydrometallurgy.

The lithium-ion battery recycling market is significantly different from that of the lead recycling market in that it is a nascent industry. With no predominant technology to displace, our goal is to enable new and existing recyclers across the globe with Li AquaRefining as a best-in-class solution for meeting the supply chain demands of the lithium-ion battery industry as well as meeting the environmental needs of the planet and the corporations seeking to achieve net zero emissions.

The competitive advantages of the Aqua Metals project include:

Intellectual Property Rights

We regard the protection of our technologies and intellectual property rights as an important element of our business operations and crucial to our success. We endeavor to generate and protect our intellectual property assets through a series of patents, trademarks, internal and external policy and procedures and contractual provisions.

Patent Portfolio

Currently, we have secured 4 US patents, and 1 international patent for recycling various battery chemistries, including lithium ion and lead acid batteries. In addition to the US patents, we have one international patent in South Africa. We also have 24 US and foreign patent applications pending with patent applications pending in 15 additional non-US jurisdictions, across five distinct patent applications relating to certain elements of the technology underlying our AquaRefining process and related apparatus and chemical formulations. The claims of the granted patents substantially address the same subject matter and are drawn to various aspects of processing lead or lithium materials using an aqua refining process. Differences in the claim number and scope are due to local rules and practice as well as the target metal.

We intend to continue to prepare and file domestic and foreign patent applications covering expanding aspects and applications of our technology, as circumstances warrant.

There can be no assurance that any patents will issue from any of our current or any future applications. Also, any patents that may issue may not survive a legal challenge to their scope, validity, or enforceability, or provide significant protection for us. Competitors may work around our patents, so they are not infringing. Our patent portfolio and our existing policy and procedures safeguarding our trade secrets nonetheless may face challenges so that our competitors can copy our AquaRefining process.

Trademark Portfolio

We have filed for trademark registration in the US and foreign countries for the following trademarks:

Trade Secrets and Contract Protection

We have developed our internal policy and procedures in safeguarding our trade secrets and proprietary information. Our procedures generally require our employees, consultants, and advisors to enter into confidentiality agreements. These agreements provide that all confidential information developed or made known to the individual during the course of the individual’s relationship with us is to be kept confidential and not disclosed to third parties except under specific circumstances. In the case of our employees, the agreements provide that all of the technology that is conceived by the individual during the course of employment is our exclusive property. The development of our technology and many of our processes are dependent upon the knowledge, experience, and skills of key scientific and technical personnel.

Government Regulation

Our operations and the operations of our licensees in the United States will be subject to the federal, state, and local environmental, health and safety laws applicable to the reclamation of LABs and lithium based batteries. While the reclamation process itself is generally not subject to federal permitting requirements, depending on how any particular operation is structured, our facilities and the facilities of our licensees may have to obtain environmental permits or approvals from federal, state or local regulators to operate, including permits or regulatory approvals related to air emissions, water discharges, waste management, and the storage of batteries on-site should that become necessary. We may face opposition from local residents or public interest groups to the installation and operation of our or our licensee's facilities. Failure to secure (or significant delays in securing) the necessary approvals could prevent us from pursuing some of our planned operations and adversely affect our business, financial results, and growth prospects.

In addition to permitting requirements, our operations and the operations of our licensees are subject to environmental health, safety and transportation laws and regulations that govern the management of and exposure to hazardous materials such as the lead, acids, and other metals involved in reclamation. These include hazard communication and other occupational safety requirements for employees, which may mandate industrial hygiene monitoring of employees for potential exposure to lead. Failure to comply with these requirements could subject our business to significant penalties (civil or criminal) and other sanctions that could adversely affect our business. Changes to these regulatory requirements in the future could also increase our costs, require changes in or cessation of certain activities, and adversely affect the business.

The nature of our operations and the operations of our licensees involves risks, including the potential for exposure to hazardous materials such as lead, that could result in personal injury and property damage claims from third parties, including employees and neighbors, which claims could result in significant costs or other environmental liability. Our operations and the operations of our licensees also pose a risk of releases of hazardous substances, such as lead, acids, and other metals related to lithium batteries into the environment, which can result in liabilities for the removal or remediation of such hazardous substances from the properties at which they have been released, liabilities which can be imposed regardless of fault, and our business could be held liable for the entire cost of cleanup even if we were only partially responsible. Like any manufacturer, we and our licensees are also subject to the possibility that we may receive notices of potential liability in connection with materials that were sent to third-party recycling, treatment, and/or disposal facilities under the Federal Comprehensive Environmental Response, Compensation and Liability Act of 1980, as amended (“CERCLA”), and comparable state statutes, which impose liability for investigation and remediation of contamination without regard to fault or the legality of the conduct that contributed to the contamination, and for damages to natural resources. Liability under CERCLA is retroactive, and, under certain circumstances, liability for the entire cost of a cleanup can be imposed on any responsible party.

As our business is currently focused on operations within the United States, we are primarily subject to U.S. environmental, health and safety laws, including permitting and compliance requirements. However, to the extent we pursue potential future opportunities outside of the United States, our operations or licensed activities could become subject to the environmental, health and safety laws of other countries, including requirements related to the transportation of hazardous materials. Environmental regulatory and enforcement frameworks in certain international markets may be subject to change or less predictable than those in the United States. While we do not currently operate outside the United States, any future expansion into international markets could result in additional compliance costs, and failure to comply with such requirements could adversely affect our business. At this time, it is not possible to reasonably estimate such potential costs or impacts.

Employees

As of the date of this report, we employ 11 people on a full-time basis. None of our employees are represented by a labor union.

Financial and Segment Information

We operate our business as a single segment, as defined by generally accepted accounting principles. Our financial information is included in the consolidated financial statements and the related notes.

Available Information

Our website is located atwww.aquametals.com and our investor relations website is located at https://ir.aquametals.com/. Copies of our Annual Report on Form 10-K, Quarterly Report on Form 10-Q, Current Reports on Form 8-K, and amendments to these reports filed or furnished pursuant to Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended, or the Exchange Act, are available, free of charge, on our investor relations website as soon as reasonably practicable after we file such material electronically with or furnish it to the Securities and Exchange Commission, or the SEC. The SEC also maintains a website that contains our SEC filings. The address of the site iswww.sec.gov. The contents of our website are not intended to be incorporated by reference into this Annual Report on Form 10-K or in any other report or document we file with the SEC, and any references to our websites are intended to be inactive textual references only.