Hello and welcome. We appreciate you joining us today at Water Tower Research insights conference for this session with 5E Advanced Materials. I'm Dmitry Silverstein, Managing Director, Chemicals and Materials Technology at Water Tower Research, and it's great to be with you today. Today, we're joined by Paul Weibel, CEO of 5E Advanced Materials, which trades on Nasdaq Exchange under the ticker FEAM. Thank you for spending the time with us today. Pleasure to be here. Thanks, Dmitry. A quick reminder before we get going. 5E Advanced Materials' safe harbor statement is available on company website. Additionally, this discussion may not be reproduced or transcribed without the express written consent from Water Tower Research. We welcome your questions throughout today's conversation. Please submit them through the chat, and we'll do our best to address them in follow-up email or in our coming up management series report. If you would like to request a meeting with 5E Advanced Materials, you can do so throughout the conference portal, and we will attempt to set a request. With that, let's begin. Paul, you've positioned boron as an energy transition and national security material. Can you frame the demand outlook that's driving this mid-single-digit growth that the material is experiencing and the expected supply deficit of boron, which potentially can start as early as this year? Sure. Happy to do that. What I'd like to do is I can share a snippet here from our presentation. I think the first important thing, let's cover what underpins [team's] value. 5E just holistically, we're a boron-based project. Primary mineral is boron. Boron is that fifth element on the periodic table, and we have a California-based project. Our location, about halfway between Las Vegas and L.A., and we sit about two miles off of Interstate 40. What's very much front and center is the critical minerals landscape on which boron was one of the newest additions to the USGS critical minerals list, that was released in November. That is a major catalyst and differentiator for our project. Additionally, we have all of our major mining permits. That includes a Record of Decision with the BLM, a Conditional Use Permit and approved reclamation plan with the State of California, and an Underground Injection Control permit with the United States Environmental Protection Agency. In the background here is our pilot plant where we've de-risked this project over the last two years, and that's basically building momentum to put HOAs or offtake agreements in place that'll underpin the debt financing where we target a $285 million letter of interest with the U.S. EXIM Bank. Specifically for your question, what is boron in that 5.5% CAGR? Boron supports over 300+ applications and makes life as we know it exist today. This includes everyday industrial use applications to high-end specialty applications. For example, boric acid is used as a cleaning supply and is fundamental to ceramics. Additionally, it's used in insulation as well as all forms of glass, and that includes textile fiberglass, Pyrex, and LCD. Boron is absolutely critical to these everyday use applications, and these industries are all growing, and growth is very much more in line with inflationary 3%, 2%, 4% per year. No question, there's some cyclicality to these industries, but because of its boron, we call this value in use, i.e., what boron provides as a chemical property, there are very few substitutes. A great example of this is ultimately cellulose insulation. North America, we build our houses predominantly out of wood. Insulation, i.e., recycled paper that is blown into attics and walls, the main ingredient to meet fire efficacy standards in North America is boric acid. Listen, no question when housing's doing great, this market's growing at above normalized CAGRs. If housing has a setback or slows a year, the cellulose industry will slow. Ultimately, what's important is that there's very few replacements for what the boron provides. Now you can layer on specialty applications such as the nuclear industry, the magnet industry, defense, AI, and robotics. From a specialty perspective, let's take permanent magnets, where those magnet chemistries are Nd for neodymium, Fe for iron, and B for boron. When you make a permanent magnet, there's two common ingredients. The first is the rare earth piece, which is the neodymium. The second is the ferroboron piece. This is a market that's growing at mid-teens CAGRs, and while like 20% of magnet chemistry is the ferroboron, if you look at those CAGRs, we're going to need a lot more boron in this world. Today, there's no ferroboron produced in the United States. Another example, nuclear. The enriched B10 is ultimately the core ingredient for shielding. SMRs are becoming more popular. Nuclear is growing. This dovetails into more boron consumption. Also, boron nitride, that's a main ingredient in semiconductor manufacturing. You talk about AI, robotics, that market's growing, and then you have boron carbide, which is ultimately more defense-oriented, and again, 5%, 6% CAGRs attributable there, especially as you dovetail into wars. You have this gamut of diversification with 300+ applications. Yes, there's the more industrial, everyday uses, and they're definitely growing in line with more inflationary factors, and there will be cyclicality to them. You layer on the specialties, and there's drivers that have CAGRs in the mid-teens. That's how you tie out to that 5.5% CAGR on an annual basis. Understood. You've mentioned the applications in boron in such national security markets as defense, semiconductors, nuclear, permanent magnets. Given the current supply concentration of boron production, not in the United States or North America, or even friendly jurisdictions, how strategic is it for the U.S. to have a domestic boron source? It's absolutely critical. I'll share here, but what's really interesting is that this market is every bit of an oligopoly. When I say oligopoly, it's more for just general borate market. There's two companies that basically dominate 85% of global supply. One is the Turkish government, two is a subsidiary of Rio Tinto. You have a couple other smaller borate providers, but very much oligopoly structure. Any of those other producers tend to be fairly captive. Like, you have maybe two or three small producers out of South America. Any boric acid produced in South America tends to be captive to the South American market, and then ultimately goes into ag. Again, you have a company out of Russia. They produce some boric acid, but again, very much captive to that Asian market there as well. From just a domestic production capacity, it's really just the Rio Tinto asset. There was a smaller producer. Again, they were more focused as a soda ash company, boron byproduct. The soda market, because of synthetic capabilities out of Asia, is pretty long right now. Recently they've publicly announced this other smaller producer has exited the soda ash market, and in turn, also the boric acid market. Now they're going to continue to produce a sodium borate product, which is how they're going to move that business forward, again, out of the boric acid market, which was about maybe 55,000 tons a year. This was very unexpected. This is also recent. It's publicly available. What this has driven is ultimately, we're now in a deficit in the domestic market. About three weeks ago, we were visiting customers, and about 12, all kind of in U.S. domestic, and we've seen a reception like we've never seen before, and that was because there's about that 55,000 tons has exited this market. We saw 2025 be the year of parity. We saw natural, kind of those 5.5% CAGRs catching up and starting to push the boron market into a bit of a deficit, small, in 2026. Now we've seen 55,000 tons just exit the market. That has officially just pushed it into a straight deficit. Anyone who was blessed by a contract from one of the majors, they may be on allocation, but they've been able to essentially have their supply ultimately, or demand met by fairly reliable supply. Again, very little product in the spot market. When you take away that 55,000 tons, ultimately, [math], people are left to scramble. What they've done is they've kind of called some of these South American producers. Again, there's been product quality issues coming out of there. That product tends to be higher in sulfates and chlorides, ultimately relying on the Turk. We saw 2026 be a year where both majors increased prices about 10%, and now what we've seen is another 55,000 tons exit the market. What we haven't seen yet is that LCD Asia-dominated market really become impacted by that yet. The expectation is that the ripples we're seeing in the domestic market will start to migrate over to that in the upcoming contract negotiating season this summer and fall, where ultimately higher prices will follow suit. For domestic supply, listen, we now officially do have a single point of failure. You know, that's the Rio business. That is publicly known. That's for sale right now. I expect a deal to be announced sometime in kind of late May or June from what Rio's put out in press releases. Probably best guess would be maybe a close at the end of the year. I think there's some underlying currents in the borate market that make this a very, very interesting time, where the second largest producer will change hands. A smaller producer has exited, and this domestic market's in a deficit. Ultimately, as you think about all these different applications that make life as we know it exist, it is more important than ever to have a second supplier come online. Understood. Clearly, Paul, the macro environment as well as the national security environment is conducive to what's going on here. Let's move to your specific asset. Talk a little bit more about Fort Cady. You kind of provided a very quick overview at the beginning of the conversation. Can you speak a little bit about the project and what makes it unique relative to other global boron deposits? You mentioned the concentration. Is there a purity? Is there ease of extraction? Can you talk about what makes this project perhaps different from other smaller boron projects that may be in development? Sure. I can say boron deposits that are, one, economic, two, have size, are inherently very rare. We're like a very rare breed of animal that's almost on the endangered species list. There's really only three or four sizable and potentially economic projects across the globe. This is why there's an oligopoly structure inherently in this market today, because large boron deposits are incredibly rare. You need fault lines, volcanic activities. There's four types of geology where boron is commonly found, or minerals. That is tincal, kernite, which if you think about Kern County in California, that's where the kernite comes from. That's Rio's deposit. Ulexite, as well as colemanite. Today, Turkey has the majority of colemanite deposits, and that mineral, colemanite, is a calcium-based boron mineral. Our minerals is colemanite. The benefit of colemanite is very easy to leach. That reduces technical risk. We have a very large multigenerational resource and reserve of boron. If you just look at our resource alone at the 130,000 tons of boric acid we'll produce in phase I, that's enough boron to produce about 200 years of mine life. Now our reserve has a mine life of initially 39. 5 Years. SEC rules basically say that what's contemplated in your mine plan ultimately can only be what's in your reserve statement. It's like for us, we're in-situ leaching, so we obviously have injection recovery wells. It's very similar to oil and gas. We proposed a mine plan that has X number of wells, 27 to be exact. We can increase that reserve and that mine life by adding incremental wells to our CapEx plan. We didn't design a mine plan today to mine the whole entire deposit. Though there's enough deposit there to mine for 200 years, what's in our CapEx today is only enough for 40 years. With a very high degree of confidence, we can convert measured and indicated resource to proven and probable reserve. Candidly, 40 years is sufficient today. I'm 42, so I'd be 82 when that initial reserve goes away. This is a deposit, though, that will be around for many generations to come. That colemanite zone, it was actually a lake millions of years ago, and it evaporated, and that sits actually at 1,300 ft-1,500 ft below ground. Listen, all the major mining permits are in place. While one could argue it's a big greenfield, it's brownfield from infrastructure. We do have a megawatt of shore power today. We sit 2 mi from Kinder Morgan's Mojave Natural Gas Pipeline. That actually runs all the way down to West Texas in the Permian Basin, and that is included in our Record of Decision and our plan of operations, where we would tie into that natural gas plant to get reliable natural gas for the long-term power of the project. Additionally, we could always tie into the grid as well. We are already tied in, and we can upgrade that shore power. The point being, there's optionality. We have ample water, not in the deposit, actually outside the deposit. That deposit is bound by faults, and there's no water in the faults. Outside the faults, we actually have water. We're in a closed basin. I call it low-quality water. There's a high total dissolved solids in there. You wouldn't fertilize crops with this water. It is really low quality. For our process, we can use it. We're a two and a half hour drive from Port of L.A. and Long Beach, so as we think about that cost to serve the Asian market, we're very competitive. Two, in turn, listen, we sit two miles off of Interstate 40, so listen, if you go east, you'll eventually hit Nashville, Tennessee. You're good proximity to highway, and then obviously there's rail hubs along the way that you could tie into as well to get to other various parts of the country. I think, strategically from just an infrastructure perspective, major advantages for 5E. Two, we've been de-risking this with the pilot plant. Three, we have a multi-generational asset, and ultimately we have all the major permits. That really sets us up to scale. I think on the cost structure, we continue to find ways to make ourselves competitive and relevant. For many years this project didn't work because ultimately the boron was a very low price commodity. Supply and demand has ultimately caught up where prices have gone higher. Additionally, that cost structure has changed, especially as you have depleting assets, costs go up. That has put us, probably going to land number two on the cost curve of three, and that sets us up to ultimately scale. Understood. Paul, you emphasized the de-risking aspect of your story a couple of times, so let's unpack that a little bit. What does de-risk mean today for you? What has the pilot facility validation done to de-risk this? Sure. I think the way we mine's a bit different. In-situ leaching mining, very actually common in uranium to target veins. It's common in soda ash as well as potash. I think the concept of using solution to extract minerals, it's pretty low risk. To do it to a colemanite deposit for boron, all the other boron miners are open pit. We've needed to understand with a high degree of conviction what's ultimately coming out of the ground. We're permitted today to mine with 5% hydrochloric acid. The permit allows for, we could mine with sulfuric as well as carbonic, which is CO2. You wouldn't want to mine with sulfuric because we're calcium based, and so ultimately that would create gypsum underground, which would then cure to concrete. We don't want to do that to the geology. That would be bad. We mine with an HCl, and then aboveground we'll put sulfuric acid into the process to precipitate out gypsum or calcium sulfate, and then actually azeotropically regenerate hydrochloric acid, which becomes our feedstock to go back downhole. It's more advantageous to use sulfuric acid as our reagent because while the two acids are very positively correlated, sulfuric, albeit right now, obviously the Strait of Hormuz has caused some challenges in the sulfur market. Traditionally there's a good $30-$40 ton spread, which with sulfuric traditionally being the cheaper of the two. What is coming out of the ground needed to be well known and vetted, especially as we think about taking this to lenders for project finance. Ultimately, we have two years of operating data, millions of gallons of solution, hundreds of sample points. We have a full lab with ICP Analytics on site with a chemist and two lab techs that are constantly, as we mine and trial different programs, testing the solution. What we're looking at is, number one, what's the head grade? When I say head grade, I say percent of weight of boron in solution. We start when we mine with 95% water, 5% hydrochloric acid. When we recover, we're maybe 0.1%, 0.2% hydrochloric acid. All that acid has been neutralized and replaced with boron in solution. Right? The higher that head grade, and we've consistently been between 6% and 6.5%, we've seen high data points at different points at times. It's like how can you consistently get a higher data point? That's been a bit of a work in process and lesson learned. We know temperature does drive that. That head grade materially drives our CapEx above ground. The higher that concentration, the smaller our equipment can be above ground. Ultimately, the bigger it is, obviously it costs more money. That has been a big point of emphasis on ultimately what head grade comes out of the ground. The other thing we look at when we do our sampling is we have calcium, obviously, in there that comes with colemanite, as well as sodium, and then we also have impurities. We call them the dogs and the cats, or the deleterious elements. It's predominantly magnesium. It's also then combined with some aluminum and iron. We do have a lithium stream as well. We're working on that in parallel. From an elements perspective, we look at how much magnesium's in that solution, and we ratio it. We take our magnesium to boron, our sodium to boron, and our calcium to boron. What's really important are these data points over those hundreds of samples because when we look at those ratios, we now have that bell curve. We have a high degree of confidence of what is going to be at commercial scales. This is important because this actually impacts our variable cost and our OpEx. Because ultimately the impurities, the way we purge them is we put lime in our solution and that raises the pH to eight or nine and precipitates out all the metals in the form of hydroxide. Similarly, that sodium to boron ratios or the calcium to boron ratio, that impacts our utilization on our hydrochloric and our sulfuric acid. We now have a very high degree of confidence in what our head grade is, what our utilization will be based on our ratios, and the other thing we've done is we've done all the vendor testing. We used Fluor out of Greenville, South Carolina, well-known reputable EPC firm, and what Fluor has done is they've designed a flow sheet that they believe will work. What a lot of junior miners will not do, and they don't do it because it costs money, it costs about $500,000 to then send totes of solution or semi-finished product that hasn't been dried or different slurry points in the process to actually the OEMs for which Fluor has contemplated putting in the design. What they'll do is they'll put together a flow sheet. They'll say, "Hey, this dryer or this centrifuge, we contemplate," and there's two, three, four OEMs that they go and get budgetary bids to derive the CapEx. What we have done is we've actually sent solution and product to those OEM to test in their process. What this does is it actually locks down the flow sheet. It makes sure that we've done all the OEM testing, so we know exactly what piece of kit and what ultimately vendor we will use in our design process. This ensures when you go into FEED engineering and you're basically going to use that 30,000 engineering hours, you de-risk scope creep. Basically EPC firm says, or anyone, most juniors when they do that OEM testing during the FEED phase, they're not making changes then, and that's how you inherently reduce inefficiencies. We know our flow sheet will not change, we know exactly who we're going to use, and we've already de-risked that in the process. When we talk about the de-risking, it's operating that pilot plant to give us that run-of-mine PLS as well as know what's going to drive our variable cost OpEx profile, and then we know exactly what piece of kit and that the flow sheet has been de-risked in that process. All this, and then we know we've produced on-spec product, which has been used for customer qualification that ultimately will underpin the off-takes. Understood. Paul, thank you. That's a lot of detail that I think investors will find very useful. Let's tie this into returns and funding discussion. Your PFS shows I think $725 million in net present value, and the internal rate of return I think it was about 19%. What are the key sensitivities investors should focus on when they test this PFS for robustness? The three biggest drivers to sensitivities in our financial model. Commodity drives is number one, and that's the case with most mining companies. The more of a deficit this market is and as it gets short, as prices climb, that is very accretive to our economics. Two is production tonnage. The more you can spread those fixed costs over additional tonnage, the more economic that gets as well. Third is actually CapEx. CapEx is not the most sensitive, but it does have an impact. As we think of that head grade, the more we can outperform head grade, the more tons we would actually be able to produce out of that kit above ground. Right? You can actually bake in some upside with outperforming head grade in that. The more boron in solution, the more that kit can actually produce on a per unit basis. I think from an economics perspective, the base case that's in the PFS, and this is just phase I. A lot of other juniors, we can produce, again, 200-year mine life. What we had Fluor design and do material takeoffs for that ultimately drive a very accurate capital number is just phase I. A lot of other juniors will say, "Oh, we could go to three phases." Yeah, we could and I can give you economics. It's definitely in the billions of dollars in NPV and probably IRR ticks up because you're going to spread more fixed costs over additional tonnage, no question about that. Our team's focused on building a very realistic phase I of the project, and so we haven't focused Fluor's attention on phase II or III. Let's get to phase I before we can talk about that. There's inherent optionality and additional capacity baked in. The two main products that are contemplated, it's boric acid and then two is gypsum or we could produce a calcium chloride. What we've also been working on is we've started a FEL1 on the lithium circuit. We have lithium in solution, so there'll be some optionality potentially as we wrap up that FEL1. The other thing we have done is we can make a metaboric acid. That is not contemplated in economics today. We've figured out the technology package to get to that 80% B2O3, and that's not in base case economics as well. I think because of the work we've done on the ground, there's additional optionality that is inherently in there but is not in stated economics today. I think 19% IRR is really solid, $725 million NPV, again, very solid. Again, it's just phase one and some of the work we've been doing in addition to the core de-risking and focusing on the FEED has been nice little bells and whistles that can actually be further accretive to the economic profile of the project. Understood, Paul. Thank you very much. Finally, there's a lot of things that you mentioned over the course of this conversation, a lot of things for investors to pay attention to. What are the top two or three milestones or catalysts, if you will, that investors should watch for over the next, let's call it 12-18 months, so into 2027? I think the longer- term, this business has become incredibly simple. I'm one month from my five-year anniversary, okay? Five years ago, we had data because they did pilot operations, three series of tests in the 1980s, but it was still very theoretical. That has been completely de-risked. It's very real. We can produce boric acid, and then this is a minable deposit. The business now is three pillars. The first is commercial agreements. I've been saying it for a while, but we're out with term sheets this week for off-take proposal on the back of those visits three weeks ago. Once we have the off-takes, we can then go be applying for the debt package and the long-term financing, and then ultimately it's going forward with FEED engineering for both Wellfield and the commercial plan. Essentially, what you want to do is, each has a detailed work stream behind them, but the reality is all of them need to go in sequence to reach FID. You need commercial agreements, you need a final feasibility study that sums up the project, and ultimately, you need to know where your debt's coming. Once you get the debt, the equity should follow. I believe that in the next 12-18 months, that'll all come together. In the short- term, we applied for a $10 million EXIM loan to cover the cost of FEED engineering. We do have a biweekly meet touch point with EXIM. I think the government, because of the shutdown that occurred in default, caused some initial delays with that application. EXIM just wasn't at their desks while the government was shut down. They picked that up when they returned, and now we have a biweekly call where I think in the next 60 days, we'll have a $10 million facility in place that we can draw down on that'll cover the cost of FEED engineering. I think that's near-term catalyst. In turn, listen, I have the expectation that commercial agreements will follow. I use the analogy, we did the larger capital raise. We raised $36 million off the S-1. It was a tough deal. Stung a little bit from a price point. That gave us the money that we're basically financed through FID. Every four to five months, I've been raising money, and that was my major focus. I now use the analogy, Mark and I bear the commercial ring, and I'm like Frodo Baggins, and he's maybe Sam from, if you're a Hobbit or Tolkien fan. The mission here is to stitch up the commercial off-take agreements. That's my focus today. I'm no longer raising money. We're going to get them across the line, because this is where I'm spending my time and my effort right now. Behind that, it's going to be the lending. I think off-takes, HOAs in the near term. We're out on proposals now, and we've got some creative options that actually are resonating with customers. I think that will underpin our off-takes. It helps that 55,000 tons is no longer in the market. That has created a door opening where carpe diem, it's time to seize the day. Understood. Thank you, Paul Weibel. We appreciate your participation in our conference. Thanks as well to everyone tuning in. More research on 5E Advanced Materials is available at www.watertowerresearch.com. Again, if you'd like to submit questions or arrange a meeting with management, please use the conference portal to do so. 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