Mr. Spencer Huh reports

Neo BATTERY MATERIALS ENTERS INTO LETTER OF INTENT WITH CANADIAN MUNICIPALITY FOR COMMERCIAL FACILITY LAND LEASE

Neo Battery Materials Ltd. entered into a non-binding letter of intent on Sept. 6, 2024, with a Canadian municipality, to lease approximately eight acres of land for the construction and operation of Neo Battery's planned commercial manufacturing facility. The municipality and detailed terms will remain confidential until a definitive or formal agreement is reached. There are no material terms or considerations with respect to the LOI.

The company intends to lease eight acres or 350,000 square feet of municipal land to construct and operate its silicon anode commercial facility for lithium-ion batteries in electric vehicles and electronics. The LOI provides a framework for a long-term lease agreement to support Neo Battery's goal of commercializing Canada's first advanced silicon anode project and the municipality's economic development goals. With tax incentives and favourable lease rates compared with commercial market properties, the terms reinforce the company's priority of cost-effective expansion.

Neo Battery plans to develop a multibuilding manufacturing facility, which is expected to produce an aggregate silicon anode capacity of 5,000 tons annually. This facility will provide the company with the necessary infrastructure and capability to meet the growing demand for high performance, low-cost battery anode materials in the North American battery and EV market.

Canada currently houses and will house major battery companies, including NextStar Energy (LG Energy Solution and Stellantis joint venture), PowerCo (Volkswagen's battery arm), Northvolt and E-One Moli Energy. In 2024, Canada ranked first place in BloombergNEF's global lithium-ion battery supply chain ranking. Based on the criteria of supply chain reliability, sustainability and potency, Canada has surpassed China from previous year's rankings.

Spencer Huh, director, president and chief executive officer of Neo Battery, commented: "We are pleased to have entered into this LOI with the municipality after months-long deliberation. This development aligns with our corporate strategy of initiating commercialization efforts in Canada to capitalize on aggressive government policies and financial support for battery and energy storage projects. Moreover, with the buildout of Canada's EV ecosystem, we hope to accelerate zero-emission vehicle demand by producing low-cost silicon anode materials."

About Neo Battery Materials Ltd.

Neo Battery is a Canadian battery material technology company focused on developing silicon anode materials for lithium-ion batteries in electric vehicles, electronics and energy storage systems. With a patent-protected, low-cost manufacturing process, Neo Battery enables longer-running and ultrafast-charging batteries compared with existing state-of-the-art technologies. The company aims to be a globally leading producer of silicon anode materials for the electric vehicle and energy storage industries.

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