Hello everyone, and thank you for joining this Water Tower Research Insights Conference session with the metals company, which trades on the Nasdaq under the ticker TMC. I am Dmitry Silversteyn, Managing Director of Chemicals and Materials Technology here at Water Tower Research, and I'll be guiding today's conversation. We're excited to be speaking with Craig Shesky, Chief Financial Officer of TMC. Welcome, and thank you for joining, Craig. Hey, Dmitry. It's a pleasure to be here. Before we dive in, a quick note. The Metals Company has posted its safe harbor statement on the investor tab of their website, as well as in their latest presentations, which you can find and review by accessing www.themetalscompany.com. As a further reminder, this fireside chat cannot be reproduced or transcribed without written permission from Water Tower Research. Feel free to send your questions in throughout this presentation through the chat application. We'll address as many as possible in a follow-up email or cover them in our management series report, which we will publish later. If you'd like to request a meeting with TMC, simply indicate that on the conference portal. With that, let's get started. Craig, why don't you start by telling our audience a little bit about your background, and then walk us through the metals company and what it's trying to do and accomplish in developing its seabed resource of polymetallic nodules in the Clarion-Clipperton Zone of the Pacific Ocean? Sure. Happy to. Well, in reverse order, before the metals company, where I've been the CFO now for about five years, I was at King Street Capital Management, a $20 billion hedge fund here in New York, where I'm based, covering a lot of different sectors, but the main focus was metals and mining. In addition to event-driven long/short equity and credit, special situations, process-driven investments, and I think that's prepared me well for this industry where it's really the process and the regulatory and the legal angle that is opening up to us, which has led to the stock being up quite a bit over the last year plus on the back of Trump's executive order supporting seafloor mining from April of last year. I had 12 years at King Street Capital, and in 2019 I met the predecessor company of the metals company, DeepGreen's CEO, Gerard Barron, who is our CEO and Chairman. Look, I had never heard of polymetallic nodules. In fact, I have a nodule right here. This is the resource that TMC is developing. They are these little rocks that contain high concentrations of nickel, copper, cobalt, and manganese. When I heard Gerard's pitch, I did quite a bit of work on it, given that I did have a mandate to cover nickel and copper and other developers. It made sense to know what could be a very large source of these metals. If that supply is coming online, I should have it in my model. I did quite a bit of diligence on the company. I set up an SPV about six months later in 2020 to invest in the company alongside some colleagues, and then I joined the company full time in 2021. Prior to that, I was at Morgan Stanley for a couple of years, and I come from Northern Michigan in a mining community. I actually, in college, worked with Cleveland-Cliffs and some of their northern Michigan iron ore mines. I've seen this sector from many different angles, but this is a very exciting resource that we're developing. We expect to be permitted to begin commercial production very soon. In fact, we disclosed on March 27th that the permit, or commercial recovery permit, based on our consolidated application, we expect to be granted in less than one year from today. It's moving quickly, but it's really on the back of 15 years of work at the metals company, that we've been developing this, having spent already over $700 million taking it to where we are today. Great. Thank you for that overview. The metals company is advancing a, as you mentioned, a differentiated resource and a differentiated approach versus terrestrial mining, supplying critical metals through deep-sea polymetallic nodules, which include several metals in one resource. How do nodules compare, both economically and environmentally, to terrestrial mining? What portion of your resource base is realistically scalable in the initial phases of development? Let's say Phase 0 and Phase 1 of your intended ramp-up schedule. Sure. Well, to answer the question about economics, it compares very favorably to land-based mining, in part because you can't just compare this resource to a nickel mine or a copper mine or a manganese mine where we have four metals in one resource. You need to consider, whatever primary metal you're analyzing, the by-product credits of the other metals. For example, if you were to put this resource into nickel equivalent, it would be over 3% grade for nickel equivalent, and that is roughly double the grade in Indonesia, and it's 5x-10x higher than many of the nickel sulfide deposits that are being developed in Canada, the United States, or Australia. That grade is what really makes this an economic resource, but also the nature and the physics of where it is, the geology. You're talking about a resource that formed over millions of years on top of the seafloor, so the nodules are not buried. They're not attached to the seafloor. In fact, they can be collected quite easily without any digging or blasting or drilling, without any tailings produced, and nearly zero solid waste. Economically, what makes this resource attractive is really the grade, and the fact that you don't have to remove trees and a lot of waste material and overburden to get to it. We expect on a nickel basis to be in the low- first quartile of the cost curve. Even on a copper basis, if we were to roll all of our metal into copper equivalent, it would be approximately 7% grade. And the average copper mine in 2025 was about 0.6% globally. It is a very high-grade resource. That's what drives the economics, and I'd encourage any investors to go to our pre-feasibility study and our technical report on our website, investors.metals.co, and you can see the assumptions that went in to our model, which between our two technical reports, our pre-feasibility study, and initial assessment, shows about $200 billion of lifetime EBITDA and about $24 billion of net present value today. Environmentally, we also think this compares favorably because, again, these nodules can be collected rather than mined without any drilling or blasting or digging. It allows us to collect a resource in a relatively benign way in an area of the planet that has less life than your average terrestrial deposit. This is 4 km deep. These nodules are in an area that is very low energy. There's no sunlight that gets down to the sea floor that deep. It's also the most common area on the planet. The abyssal seafloor represents about 40% of the globe. It's a very wide, vast area and very common over large areas. In terms of not just biomass, but biodiversity, that allows you to confidently collect nodules knowing that because we have certain areas set aside, any species that might be endemic to a particular area are able to thrive and survive. We are going to be publishing our environmental impact statement this year as part of our application process with our regulator, the National Oceanic and Atmospheric Administration, NOAA. The work that we've done is already available through a video series. In fact, you'll see some more headlines on that in the coming days. It's important to know we're building on the environmental work that our regulator, NOAA, actually pioneered in the 1970s. NOAA studied this area in the Clarion-Clipperton Zone between Mexico and Hawaii very intently. In fact, they reported to the U.S. Senate in 1995 that they believe polymetallic nodule collection should go forward and that nearly all environmental questions had been answered at that time. It's important to note that we have a regulator who knows this industry well, who has been the environmental pioneer, and on top of that, you have the directive from this administration to have them act quicker to get us our permit based on legislation that was put in place in the 1980s. We're really on solid footing. I might answer the one other question that you had just on what is the ramp up? How much of the resource would we go after? Maybe we put it in terms of tonnage. We have SEC- compliant resource statements showing 1.6 billion tons of polymetallic nodules. Of that, about 356 million tons are in the first area over which we have a pre-feasibility study, what we call NORI-D. Now, the application that we've now made in January of this year to NOAA goes well beyond NORI-D. Even just on NORI-D, that 356 million tons, we anticipate collecting about 46% of it. Even at that 46%, that drives the $5.5 billion NPV in that PFS and similar across the whole area, getting to the $24 billion NPV. Even at collecting less than half of the nodules, setting aside certain areas for environmental protection, assuming that there are some collector inefficiencies that frankly we can improve upon over time, we think it's a conservative assumption. The great thing about it is we're starting with one ship, and that one ship, the Hidden Gem, already collected nodules at scale in late 2022, lifting about 3,000 tons of nodules to the surface. We're confident we can do it. The nature of this resource allows us to ramp up in a measured way. Really it's a matter of getting more ships on the water. It's not like on land where you have to drag the infrastructure with you as you go further and further into a far-flung ore body. There are a lot of natural advantages to this resource that make it unique compared to land-based. Great. Thank you for that, Craig. Let's move from the resource to how you actually intend to process and deliver these materials. What key technical risks remain in scaling your end-to-end, the offshore collection and the onshore processing? I know you've gotten together with some partners to get these pieces together, but can you provide an update on where this stands and what the next steps are? Definitely. I would say on the offshore side, we and our partner, Allseas, feel very confident that the key execution risks have been well understood and dealt with. We're going to continue to learn more, of course. It's not to say that everything went perfect in our test in 2022, but it went very well. In fact, it gave confidence to TMC and Allseas to increase the targeted production size of that vessel based on how well that trial went. Offshore, it's really a matter of building additional collector vehicles, putting in a wider riser pipe, pumping more air, kind of making the full production system bigger, faster, stronger. That's what we and Allseas are working on doing as we're beginning the work to get that vessel ready for commissioning in late 2027. On the onshore side, the technology here we feel is well in hand. We and our partner, Hatch, a Canadian engineering firm, have developed a flow sheet to process these nodules, and that flow sheet's been tested at scale in Hachinohe, Japan, where Dmitry, you and I and others toured that facility in 2025. The technology here is proven. That flow sheet's been deployed to process nickel laterite in many facilities around the world, hundreds of facilities, on a rotary kiln electric arc furnace basis. Really it's a question of where should that processing occur? The technology to do it is well in hand, but for example, the United States, which is going to be permitting us to get into commercial production, the United States has not built a smelter in about 70 years. If the United States wants to truly re-industrialize, you may have seen the refinery headline in Brownsville, Texas, that the Trump administration is supporting the first new oil refinery domestically in the last 50 years. Well, in Brownsville, that's where TMC announced we have a site selected to potentially build a domestic processing and refining hub for polymetallic nodules and to own this ecosystem end to end before China tries to dominate it as they have in so many other land-based alternatives. Again, whether we're pursuing that is going to be dependent on some feasibility work that we are doing with our partner, Mariana Minerals, former engineers and executives from Tesla, SpaceX, Redwood, and others. We feel very confident that we have the flow sheet, we have the feedstock, we have the expertise to build something, but it's conditional on U.S. government support. We're not going to go out and try to do this on our own. If the U.S. wants to continue on the path of re-industrialization and truly establishing metal independence, we think we have the site to do it. A prerequisite to getting some government money from various agencies that were named in last year's executive order. Those agencies include the Department of War, Department of Energy, EXIM Bank, et cetera. They were all tasked with thinking of how they can support this industry. In order to truly move down that road, one needs a site-specific feasibility study. We have the site, and we also now have a partner to do that feasibility work. Stay tuned on that front over the course of 2026 as these conversations progress. Great. Thank you. You mentioned something that would actually lead me to my next question. Processing is clearly tied to permitting and policy. Let's discuss this, the regulatory pathway a little bit more. You mentioned that you've submitted your application with NOAA. What milestones remain in the processing of that application? You talked about having an economic model, environmental impact statement. Anything else that we should be aware of that needs to be submitted before you get your permit? We would say on our side, the key parts of the work are complete. The environmental impact assessment, for example, we've done all of the offshore work. We have all the data. We've begun submitting the data to global databases. We've been sharing some of the key conclusions of our environmental work already with our regulator, NOAA. The formalization of that will be in our environmental impact statement, which will again, be completed in the coming months. I'm not sure if I'm able to share my screen. I'll just pull up one quick slide to show you where we are on this timeline. It's building on some of the regulatory permitting milestones that we had with NOAA last year. You'll see here on the bottom in this gray arrow, there were a lot of learnings over the course of 2025 when we submitted first our application in April, and then had that application certified, deemed fully compliant. There were public hearings on that exploration license application. Now in 2026, NOAA modernized their permitting regime by consolidating the application process for exploration licenses and commercial recovery permits. TMC is the first and only applicant to submit under this consolidated application program, in part because we're the only ones who have actually already done the work. We've spent over $250 million on our offshore environmental work. We've spent over $700 million on the project so far. You may see there are other names and other folks who are in the headlines in this industry, and we welcome that. It's great to see capital flowing into this U.S. approach. The market is clearly voting with its feet, showing that they trust the U.S. process as investable, contrary to the International Seabed Authority process. It also means TMC is really the first one through the wall here, because we've actually already done the requisite work to get that commercial recovery permit. Some of the milestones you would see ahead would be full compliance on that consolidated application, public comment periods, hearings, and our environmental impact statement, all of it leading to the grant of the permit in less than 12 months from today. There will be regular permitting milestones, and you'll see a string of PRs from TMC as we tick through all of these milestones leading up to the permit. It's not going to be some black box where we're just guessing, when will the permit fall from the sky? You will be able to see this and track this and hopefully associated with that, a step change in our valuation as we get closer to that permit. Because right now, Dmitry, we're trading at about 7% of the underlying net present value, based on our SEC-compliant technical reports. That is very low compared to where a typical pre-production developer might be trading. Part of that is people view this as different or new, but really we're building on resource standards and environmental work that is very well established, and the technology to do this is also quite proven. I think that valuation will change very clearly over 2026 as these milestones continue to be collected on the way to the grant of that commercial recovery permit. Great. Well, that actually leads me to my next question. As you're thinking about coming up and hopefully will be receiving a permit within the next 12 months or so. How are you thinking about the capital structure of the business? Specifically, how does the upcoming, or actually, it's already happened, the Nasdaq debut of The Metals Royalty Company, which I think started trading under TMCR, which includes royalty on your NORI project, and your retained equity and buyback rights in that entity. How does that enhance or change your financing strategy and capital efficiency? Yeah. Typically for an explorer and developer, you're funding through equity, particularly in an industry like this where we've wanted to stay capital light. It means equity is the way to go, because there aren't a lot of heavy capital assets against which we can borrow. We prefer to stay nimble and capital light like that. Again, unless, of course, the U.S. government wants to partner with us to help deliver a game-changing facility somewhere in Texas. Staying capital light means equity has been the way to go. I think looking at TMC now versus five years ago when we had just gone public, we have a more broad toolkit. You mentioned TMCR. That is a royalty that TMC has granted to TMCR. This was back in 2023. It's not new news, it's just they are now publicly traded, and that royalty is a 2% gross overriding royalty on our NORI area, 3/4 of which can be bought back by TMC through cash flow. Self-funding buyback mechanism. TMC retains an equity stake in that entity itself. Our current stake in TMCR is 25%. Based on this morning's trading price, that would be worth about $190 million. You have a lot of tools in your toolkit. We think the stock for TMCR is going to go much higher than that, as they have a very interesting pipeline of other transactions. There's been this white space open within base metals, where they haven't been quite as active as, let's say, the gold and silver markets in taking advantage of royalties to help fund these projects. I think this is the right team, led by Brian Paes-Braga, to really take advantage of that white space. We have that large stake. We had approximately $118 million of cash that we last reported at year-end. Cash balance is in a similar ballpark now. On top of that, we have a $45 million unsecured credit facility from two of our directors, and we have over $400 million of potential warrants that could be exercised, and about $100 million are in the money or close to being in the money. Importantly, TMC is now deemed a well-known seasoned issuer by the SEC. That means we have an S-3 now on file where we could issue securities as and when needed. Now, there are a lot of other people who have been in the market raising money for deep-sea mining. TMC's being patient in this respect because we do see some of these milestones ahead. We see our strong cash position, we see the royalty stake, we see the warrants that could be exercised. There are a lot of opportunities for us to keep the project on track and fund some of our offshore spending over the course of 2026 without tapping the public capital markets. We're being patient for that reason because we're confident in where the stock is going. Therefore, why not take a bite at the apple at a much better valuation and a much lower cost of capital? Our overall strategy is to be patient, to protect against dilution at all costs, and take advantage of what is now a broader toolkit that we have at our disposal, including royalties, warrants, equity, and then potentially U.S. government support. Great. Thank you, Craig. That was a really good summary. Putting this all together and kind of looking forward to the near-term milestones, what are the most important milestones over the next, let's say, 12-18 months? You mentioned the permitting progress, processing decisions, financing. What should investors pay attention to over the next 12-18 months to judge how well you're executing and to get a better idea of when the commercialization part of this development is going to start? Yeah, look, permitting is clearly the number one. It would be shocking to see us continue to make progress on that permitting path and not have the commensurate rerating in that valuation. Frankly, as a former buy-side analyst, I'm not sure why more people aren't seeing that clear opportunity and coming in knowing that these milestones are ahead, but also knowing that we have the data to provide the confidence to a regulator, NOAA, that granting this permit's the right thing to do, in addition to being a national security imperative directed from the White House. We think that permitting process is clear. We're very confident that the permit will come and watching some of those milestones, really, there are seven key milestones leading up to the permit grant. As you see us with this application, which will soon be posted on the Federal Register, people will be able to see where we are in the process and ensure that we are staying on target for the timeline that we've indicated. I think some of the other milestones, we mentioned that we're going to do that feasibility work in Brownsville. We're going to be reaching and signing commercial agreement with our partner, Allseas, hopefully in the coming days or weeks, which formalizes a commercial agreement that was really already incorporated in a pre-feasibility study. I don't think people should be expecting that Allseas agreement to be a material alteration to project economics other than we'll provide a little more color on hopefully what is a lower capital burden to TMC on the modifications to the Hidden Gem vessel. Overall, I think when you look at 2025, for example, some of the key catalysts that move the stock were not anything that I would've been able to talk about in a webinar. Investment from Korea Zinc, investment from the Hess family, the executive order coming in April. The permitting process, we can talk about the feasibility work for our onshore side. We can talk about the offshore work with our partner, Allseas. We can talk about that. Really the things that may move the stock are elements of strategic discussions and perhaps public-private partnerships. There's a lot of new interest in this space. You're seeing capital flow into this space, and TMC, I believe, is the leader here, and that should benefit us as well as many other peers who are seeing this as a very investable market, and a very investable resource. Absolutely. Thank you. Thank you for that. On behalf of Water Tower Research, thank you, Craig Shesky, for participating in today's fireside chat. My pleasure, Dmitry. Always good to talk to you. Absolutely. Always happy to have you here. We also would like to thank all the other attendees for joining us. Additional material related to the metals company can be found at www.watertowerresearch.com. Investors with remaining questions or those wishing to request a meeting with management are encouraged to communicate their interest via the conference portal. Please remain with us as our next conference session will be starting shortly.