Comstock Inc.

Good afternoon and thank you for joining Comstock Inc.'s second quarter 2026 results and business outlook. I'm Zach Spencer, Treasurer and Corporate Secretary. Today is Thursday, July 23rd, 2026. We are streaming live and this session is being recorded. Thank you for watching. As a reminder, Comstock is listed on NYSE American with the ticker LODE, L-O-D-E. Joining me today are Corrado De Gasperis, Comstock's Chief Executive Officer, and Judd Merrill, Comstock's Chief Financial Officer. After their prepared remarks, we will take questions. We received more than 40 questions in advance of the call. If you have additional questions during the call, please use the Zoom Q&A window. And we are extending this webcast today to address as many questions as possible. Today's discussion will include forward-looking statements. Actual results may differ materially due to risks and uncertainties detailed in our SEC filings. Full risk disclosures can be found in our filings on the Investor Relations page and on the SEC website. With that, it is my pleasure to introduce our Chief Financial Officer, Judd Merrill. Judd, you may begin.

Thank you, Zach, and welcome, everyone. I'd first like to briefly touch on this slide. Over the past several months, we've worked intentionally to build a stronger capital base and surround the company with high-quality investors, strategic partners, and commercial relationships. We view these relationships as important validation of the progress we've made and opportunities that are ahead. And before I begin my financial remarks, I'd like to recognize our board of directors. We have an exceptionally engaged and experienced independent board that is actively involved across every aspect of the company's strategy and governance. Our directors are highly focused on disciplined capital allocation. They remain fully informed on our liquidity and cash position, and they work closely with management to ensure that we deploy capital carefully and judiciously. This is primarily towards accelerating our metals recycling platform and advancing the monetization of Sierra Springs investment. And then of the board, there's committees and each committee is playing an important role as the business evolves. Our audit committee is actively overseeing our financial reporting, risk management and implementation of controls that support our new Comstock metals operations. Our compensation committee continues aligning both the annual incentive plans and the long-term equity incentive with shareholder value creation. So that means that these are truly performance-based incentives. And our environmental committee is providing important oversight as we advance first of kind permitting and sustainable operations. Now I will move to some comments on the quarter. Our second quarter of progress represents another set of important achievements in completing Comstock's transformation. Last quarter we talked about positioning the company for execution. This quarter we have begun executing on virtually every major objective we laid out at the beginning of the year. So our balance sheet remains strong, our business has become significantly simpler, and our first industry-scale metals recycling facility is ready. And we continue advancing several high-value monetization opportunities, including the sale of the mining assets, the positioning of the sale of our real estate through the now nearly 50% owned Sierra Springs investment. Here are a few financial highlights from this quarter. We ended the quarter with approximately $31.4 million of cash and no debt. We also ended the quarter with total working capital of $39.9 million reflecting current assets, $58.1 million against lower current liabilities of $18.2 million. We do expect another $20 million in cash in August once we close on the securities purchase agreement and sell 100% of our legacy mining assets to Mackie Precious Metals. That cell, the mining assets, will also remove all mining reclamation liabilities and related bonding requirements and associated costs from our balance sheet. And that's while retaining an upside in both the NSR royalties across the district and retaining meaningful equity in MACI. And the mining cell will also eliminate annual costs of about 1.4 million and free our capacity to focus more on the recycling business. Our outstanding share count at June 30th, 2026 was only slightly changed since we filed our first quarter 10Q reflecting only director stock compensation. We are also added to the Russell 2000 and the Russell 3000 indices in late June. And we believe that represents another step in strengthening our institutional capital base. So let me spend a minute and review how we deployed the capital during the first six months of the year and some color on why and what we were investing in. Our largest source of cash this year was our January equity financing, which generated approximately 56 million in net proceeds. But we also generated nearly 6.5 million in additional proceeds. And that includes receiving over 2 million in cash from mining asset sales, including the sale of other some older royalties, mining rights, and the recent discount sale of a note receivable. Received another $1.8 million from debt extinguishment related to recoveries where there was a make-hole provision that resulted in positive funds coming back to us. And then there is $2.6 million solar panel recycling revenue that's including the deferred revenue from our growing metals operation. and that's where the sales in June and then continuing even in this month of July were about double the rate that we experienced in May in the prior months and we're just beginning to bring in larger recycling operations online. On the uses side, virtually all of our investments were intentional growth investments. So let's review those. So approximately 21 million was invested into Sierra Springs, that's enabling and enabled the close of over 2,200 acres of land and nearly 2,000 acre feet of water rights. And that's effectively consolidated one of Northern Nevada's premier industrial land and infrastructure opportunities while simultaneously increasing our ownership in Sierra Springs to nearly 50% and positioning for major future monetization. We also spent approximately 5 million completing the first industry scale metals recycling facility. That's including the equipment installation and commissioning. Another $1.3 million expanding our product upgrade capabilities, particularly our higher value glass products. And approximately $1.4 million in advancing our new metals recovery technologies. And approximately $3 million metals operating costs as we ramp up operations and expand the sales. We are Deploying this capital as planned with product upgrade, CapEx and metal recovery R&D accelerated on the heels of our January equity offering, we believe its deployment will generate better, higher future operating cash flows for metals. On the operating results, metals, buildings during the quarter continue to ramp up, especially in June and now July, reflecting both activity from our small demonstration facilities together, plus deferred revenue associated with the growing customer and sales collection. And our new storage area is completely graded, fenced, and ready to open. And the total panels on the ground and ready for processing approach 9,000 tons. So with our first industry scale facility beginning continuous operations in August, we expect revenue to increase, increasingly transition from decommissioning activities to our industry scale commercial production. Operating expenses remain as expected. Those investments included efforts for commissioning our first industry scale facility, expanding commercial organization, building operating infrastructure, advancing product upgrading capabilities, and developing downstream metal recovery technologies. And these are planned investments designed to support multiple future production facilities, not just our first operating facility. So now looking ahead at the objectives for 2026. As we move through the second half of 2026, the financial story begins to change. Our capital spending associated with the first facility is complete. Our focus now shifts towards operating performance, throughput, customer growth, and generating higher and higher revenues. While we're working on that at the same time, we will complete the monetization of our mining assets, monetize opportunities associated with Sierra Springs and our remaining real estate, expansion of our metals platform into additional locations, and refocusing Biolum's strategy by advancing commercialization, integrating Hexis, and attracting third-party capital. So even after recording this quarter a non-cash, non-strategic impairment, which is part of simplifying and strengthening our balance sheet, the carrying value of our investments increased to approximately 67 million. We are continuing to clean up the balance sheet, maintain a stable liquidity position and remain highly focused on disciplined cash on return investment decisions. So now I will turn it over to Corrado to discuss these corporate and subsidiary objectives in greater detail. Thanks, Joe.

Yeah. I appreciate it very much. I think I'm going to give just some color on a lot of what Judd said, maybe some visual. You know, this probably might be the last time we show this slide, but just maybe to segue into real production. This was the slide that we had even before we built the demonstration facility. So now today we've completed all the pilot work. We then subsequently ran the demo facility for two and a half years. It's still running because it's effective. We keep processing panels through it and testing other panels and types of panels as they come through. But remember the four fundamental tenants that we still think are the prime differentiators. We still do not see a competing system that can eliminate all contaminants. We don't see a system that can eliminate all those laminates, plastics, glues at all. So we can do it very efficiently with no harmful emissions, but we do it effectively, which is the most important thing, because eliminating those contaminants allows us to produce clean, saleable materials. If they're not clean, if they're contaminated, then we're a hazardous waste generator. We don't have a permit to be a hazardous waste generator. We have a permit to be a recycler of clean materials. We do it at an extremely low variable cost. And those things will start to become visible after a quarter or two here that very efficient use of natural gas, very efficient use of electricity, those are our two primary variable costs. you know 92 93 of our variable costs and we do it at high speed which makes it scalable so we're effective in terms of the output and we're effective in terms of our ability to scale so this cartoon becomes a reality you know we now have the industry scale zero zero one first of its kind uh deployed now What we've deployed and what we intend to start running immediately here in August is at about 25% capacity. In August, we will be ramping that up over the course of the month, but we will start feeding panels in the front and getting panels out the back. September, October, November, December, as far as Our plans are concerned will be at least 25% capacity. It might be 25% capacity for four months. That's very important for us. It's very important for us that everyone, especially our customers, can see this showcase, can see what we're capable of doing and how we're capable of doing it. Very transparent with the money that we spent. Judd mentioned almost all of these numbers, but $12.25 million for that full system that you just saw in that schematic. We were planning to spend $1.25 million, $1.2 million, $1.3 million with NV Energy. They got delayed. We put in our own power generating system for a little bit more than that, but that's portable. So we've got some nice optionality there, but regardless, we can generate power. We spent a little bit on the rolling stock because storage became a critical aspect as all these panels are going to be coming in, and we've created a pretty huge storage capacity right next door. So that's it in a nutshell. I think Judd mentioned a smaller number, but Judd, we ended up with the additional add-ons to the Eddy system, spending almost $1.8 million, $1.9 million on the product upgrades, and those product upgrades are immediately effective. They've been completely stress tested. They're fully operating. And it allows us to produce not only high specification glass for sale, and now we have more than enough customers for taking that glass as it comes online, but we also were able to get residual metals and residual materials. And as everybody probably is tired of hearing from us right now, we capture it all and we sell it all. So those product upgrades have multiple value enhancements to us and certainly major de-riskers. When we raised the money in January, we said we'd spend up to 10 million in a metal extraction capacity. This will also be first of its kind and we're ahead. We're moving very fast on deploying a one ton per day metal recovery system this year. That's a pilot, okay? That's a pilot. So one ton a day pilot by the end of this year is what we're really, really pushing hard for. Very important in that process is validating both technically and efficiency-wise, economically, that we can extract and yield high amounts of silver from those industrial tailings that we're producing. That we're doing that, we've engaged third-party resources that are helping us do that. It's currently not being done in Silver Springs. It may end up very well being in Silver Springs by the time we're done, we'll see. That would be a one ton a day system. So that's not to be confused, right, with 100,000 ton annual capacity that we have now deployed. This is in addition to that. The product upgrades and the up specking of the glass is in addition to that. So not to be defensive, but We are a few months later than we thought in terms of bringing the big machine online, even though it's imminent now. It's imminent. It's going to be done by the end of this month in terms of full testing and full commissioning, and then we will be ramping it up in August. But we also added a one ton a day pilot system to the scope of our projects. We accelerated that aspect of what we were doing, and we added the product upgrade. by market demand, right? So that we responded to the market quickly in terms of glass and certain residuals, and we accelerated our own plans for a pilot. Now, you do a pilot for specific reasons, you don't do it for academic reasons, okay? We need to prove out that this will be both technically and economically feasible. Technically means we wanna recover all of these materials. We don't see anyone that has done this before with these types of materials. We did submit a grant for this, by the way. Government was fast and furious in their demands. We submitted it in January. They still haven't awarded it to anybody. But we never intended to wait. So even though we're still in the running for some of those monies, and it would be wonderful if we got them, because they might be in time for the demo, We didn't wait in terms of that capital to start piloting. That's why we raised the money in January. So 2026, we're going to spend that extra $2 million and prove out the extraction of silver, hopefully, and get a one-ton-a-day operation that then we can take to the next level in 2027 with what we would call a commercial demonstration system. Commercial in the sense that it's 25X scale up, but also in the sense that you build a supply chain around that, exactly like we did with our recycling demo facility. This is a picture from the annual meeting. So many of you were there. I think you could see the bus back here. Two reasons I wanted to show this aerial shot. One is where you see cars are in the back here or where you see empty space in the front here, those are all covered with solar panels now. I drove around last Thursday through the entire parking lot and I had to make sure I didn't scratch the truck. It's tight. but the good news is now you can see a bird's eye view of the storage area. That'll hold easily 25,000 tons of material. I mean, embarrassingly, we're just plugging in the last electrical outlets and installing a toilet in the little supervisor building and it's up and running. So everything's come together very, very nicely. It's a tremendous amount of work to get all of this done. This is more than just an industrial scale recycling facility. This is literally our platform and our campus for recycling, for upgrading, for piloting and testing the new processes and technologies and for storage. Silver Springs is really the hub of all of that. And the equipment is all here. It's substantially all installed. There's only one or two more steps of connectivity and stress testing to go. No fatal flaws, you know, supremely advanced scrubbers and air pollution control you see on the left, highly automated arms you see on the right. These robotic arms have been stress tested to the point where they've exceeded our expectation. Not by a lot, but our expectations were pretty high. What do I mean by that? Some of you may have seen the videos that were posted. The thing that's impressive is that we were able to stress test The loading system for an extended period of time, essentially loading two panels every 13.7 seconds. You can time it on the video if you wanted to prove me out. That means we are actually loading a panel faster than every seven seconds. So there's two things that are very important there. One, obviously, that brings us to the 3.3 million panels per year capacity that we are looking to affect. This is the constraint of the system. If the arms aren't moving, then throughput's not flowing. But also, you can see in the video, it's not greased lightning. It's not scary fast. It's not like, you know, stand out of the way or you're going to get your head taken off. This is a very stable, very methodical, very automated continuous loading. We just don't waste any seconds. We keep doing it, you know. And the metal recovery system, as I mentioned, wasn't even in the original plan. We thought we were producing the cleanest glass, and we were. But then when some of the more sophisticated customers came in, they asked for even cleaner. And so kudos to the team for being so responsive, so dedicated, so knowledgeable. You know that we were able to deploy these systems and have them operate. So we're not just producing high spec, clean glass. We're also recovering some of the metals that some might have thought were inconsequential. And then you know, the one ton a day is really designed to be the second maximizer. So we get the clean aluminum, we sell it all. We get the glass, we upgrade it, we clean it, we sell it to various customers. Now we take these industrial tailings and this is the real development effort. This is the first 2 million and then 8 million to really get to the point where we can be ready to scale this, you know, also to industry scale. and so far everything's coming together. I think if you did the analysis is that in the grand scheme of what we wanted to do, plus what we added on doing, I would say we're on schedule, if not slightly ahead of schedule. So to me that's kudos to Dr. Villamagna and an incredible team of operators and engineers that just are working their butts off. Many of you met them, of course, as you came to visit the facility. What we're seeing in the market is getting updated. We're getting more and more intimate with marketing data. We're doing more and more analysis of the panels that are deployed. We're starting to get very, very specific with all the panels, all the ages, all the dates, all the locations. More importantly, engaging the customers and the people that are in there. You know, so there are ranges of possibilities here. It's interesting for us because the age that these things come off are highly sensitive. You know, everyone's talking about panels lasting 25 years. We know that's not true. We're seeing panels come out anywhere from 14 years to 18 years. We looked at the sensitivities of our database on what if everything came out at 14, which won't happen? What if everything came out at 18? What if things came out higher? What if things came out lower? And we're getting a good handle on these ranges and we're learning some things. One of the things that we learned is that the ultimate macro scale up might be a little slower than anticipated, but we're seeing regions like Texas and North Carolina that are actually bigger today than we originally estimated they would be based on the ages. And so we're modifying our views of how we would roll out the rest of the network. Fortunato has come up with some pretty remarkable phasings of our deployments where instead of deploying 100,000 tons day one, you could deploy 25, increase it quickly to 50, increase it to 75, increase it to 100. We haven't made any decisions on any of that. And I think what's important is we won't make any decisions to deploy the next production equipment until the first facility is up and running, until the first facility is running profitable, until it starts scaling up. However, we are site selecting Ohio. We are site selecting Northern Nevada. We are looking in Texas. We are looking on the East Coast. and we're looking at is there a smarter, more intelligent way to secure market share, minimize the cost of the supply chain, grab those customers and then scale that capital more intelligently. These for us are very, very positive advancements, but there's more deployments across the US than we originally thought. That means panels already out there. That means panels already that have been in production. You saw that we announced OEM. We got an OEM with Illuminate. Remarkable, remarkable customer. Over a year of working that customer because a competitor had entrenched themselves. But, you know, we really expressed positively what we thought we could do. And apparently to the customer, that was better than what they thought other people could do. So we're very pleased with that. It's another segment of the market. The utility segment is the biggest segment of the market. It's the one we're doing the most work and analysis on. Sorry about that. And what's even more remarkable is new developments. And normally when you're an end of life and so forth. So, you know, we're seeing breakages in these installations, you know, and again, those are not as persistent, as reliable, as continuous, but they're higher than we would have expected and we've got a lot of trucks, you know, that have come in just from breakages, especially in Texas. So we have not changed any of the foundational or fundamental aspects of our guidance. Silver price is down. So we're keeping a monitor on that. You all heard from us that we don't love the idea of selling our tailings and only recovering portions of the silver value. So we're excited about accelerating our own metal recoveries. We can't wait to see The results from that, we can't wait to share the results from that. We do see clearly, if you just look at the utility segment, which depending on how you estimate the market, could be 60% of the market, could be 65% of the market. We see clearly in the next four and a half years, a cumulative of a million tons coming out. Now, we've got analyses depending on those age ranges that says it could be that much in a year. We have analyses that says it could be half that much in a year. The bottom line is we see a lot of animals coming out in the next four and a half years. We have a much stronger intimacy as to where they're coming from. And we believe we could not be better positioned to lead in this market. A lot of wood to chop, a lot of execution to do. As Judd said, we're expanding our capabilities for all of that purpose. At the end of the day, it comes down to this. Finish the commissioning, we're weeks away. We'll be done with those commissionings by the end of this month. We will start feeding panels in in August. You know, there will be some time before we ramp up to a certain rate, then we'll keep it either steady at that rate or growing from there. We've already upgraded the lines capable of making the high spec glass. We've already finalized design of the downstream recovery. We're piloting the heck out of it. We've selected site number two. We've selected site number three. We're looking in very close to selecting four. So, you know, we're more than halfway through the year. We've got more than half of these things done already. But operating a one-time-a-day system, okay, ordering that equipment for the second facility, and we're revisiting, as I mentioned. How do we do that? How do we phase that? But we ain't doing it. until one is up and running till one shows us successfully like the ramp that we're expecting to see it. And then more and more of our capacity is being allocated to securing larger and longer-term supply agreements. And as Judd said, the compensation programs are fully aligned to these objectives on an annual basis, and they're fully aligned to our equity values on a long-term basis. I'm going to spend a little bit of time talking about Sierra Springs because we deployed a lot of capital this quarter. I'm going to spend a little time talking about Biolium because we're getting good inquiries about it. And then we'll open it up for questions if that's good. I think everybody knows we're in a great location. I think the location is great because were one truck day away from about seven states and 75 million people. And it's an extremely well-infrastructured location as the crow flies very, very close to the California border, but with huge industrial expansion happening. The industrial expansion that was happening in Reno industrial expansion that was having in this northern part of the industrial park is pretty well documented but when this connecting highway you know came down to Silver Springs it didn't just enable Silver Springs it opened up the entire quadrant you know and and now what's happening in northern Nevada is is is is quite remarkable it's quite remarkable in terms of The quality of companies that are coming in, it's quite remarkable in terms of the magnitude of companies that are coming in. And it's even more remarkable in terms of the capital and infrastructure that they're building. When one CEO says, we're going to spend $100 billion in the next 10 years, and then within a year of saying that, has 2,600 acres under They're walking the talk and we're feeling it. We're feeling it. This might be the best kept secret. in the nation in terms of these industrial developments. We're fixing to help try to change that. But what we've put together through this vehicle, Sierra Springs, which had always been a novel, curious, potential monetization of a small percentage of something, It's just got much bigger than that. And we've been, and our board's been extremely diligent here, right? Check the boxes. Land is land. Infrastructure is infrastructure. Okay, but where's the power? As soon as we were able to step in and secure that power, comps changed, values changed, but most importantly, market interest changed. A minimum of 300 megawatts puts you in the major leagues. Getting over a gigawatt makes you headline news. But we're being very, very pedantic about making sure the readiness is sufficient for these counterparties. And we're in regionally, locationally, Logistically, a very, very good place. But even environmentally, it's not only a stable dry temperature, which is ideal for the operation of these kinds of facilities, it's extremely safe, insofar as, you know, national hazards are concerned earthquakes, tornadoes, you know, we don't we don't experience those things, you know, in our in our geography. certainly not like in the rest of the country. So we've put together enough acres and enough power, right, to make it interesting to a lot of people. We've looked at the various types of power and how it can be generated from that gas commitment. We've also acknowledged that even though the grid hit a wall, the Greenling project by Nevada Energy bringing The only negative concern with Nevada Energy is delay. It's just taking so much longer. But when you talk to hyperscalers, when you talk to people with serious ambitions about compute and power, there's comfort in the grid. There's comfort in transitioning to the grid. There's comfort in partnering with the grid. And the grid, is going to be tremendously complementary to what we're doing in the future in Silver Springs. And the one thing that most people don't think about is fiber. Do you have fiber? Do you have transmission of data? We might be in the best location other than being smack dab in Silicon Valley in that context. So, you know, we cover it all power, flatness, geography, climate, temperature, you know, to put together an offering that we want to monetize. Okay, so, so our goal, and hopefully you're feeling it right, you know, when we're getting a lot of inquiry in Q1, we weren't able to say a lot of things because the transactions were being negotiated, the approvals were being sought. Both boards, Comstock, Sierra Springs have approved, right? This consolidation of everything that you see in front of you, which then allows us to go to market in unison, in alignment, right? And really, really monetize this thing. So people ask me timing, we do think that we will launch this marketing effort later this summer. We do think we will be engaged very, very quickly with a lot of very prominent counterparties. We do think we can structure transactions before the end of the year. But remember, most of these firms will take 90, 120, 150 days of due diligence. We're making sure that regardless of how long that due diligence takes, and so forth. We've got a lot coming in 2028. We have even more coming in 2030. So we're positioning this thing so that the counterparties see it as very strategic, very significant, and very growth enabling for them. Just lastly, and I'll do this briefly, you know, Biolium has been moving forward under the radar. We haven't been speaking about it as much, quite frankly, and hopefully you see, because we're bringing an industrial metals business fully online, it's our number one priority. Selling our mining assets, that's done. We're weeks away, hopefully, from closing that. The only thing that's holding that up, I think Judd said it, is, you know, TSX clearance. We talked to them. on a two or three times a week basis. Everything's going fine with the TSX. You know, they just spoke with them yesterday and, you know, we expect this is imminent. You know, Sierra Springs has taken the lion's share of my capacity, you know, and now other, you know, Comstock resources. We're pleased with the progress. There's a lot that's going on there. But the Biolium team, following the Renfuel acquisition, following the Hexis acquisition, really recalibrated, you know, in a much, much more focused, much more realigned way, their thesis. Because their thesis solves the industry's problem. The industry is bottlenecked by feedstock. The industry is bottlenecked by feedstock. There's an abundance of woody biomass in the world. You've heard us say that a gazillion times. But the abundance of woody biomass, when it's diverse, disparate, and all over the place, makes it very, very difficult to build and deploy capital unless you have reliable, consistent, long-term offtake agreements for feedstock. Acquiring HEXs solved that problem. We now have the technology, the capability, the feedstock to ultimately deliver the fastest growing, highest yielding, lowest carbon, lowest cost solution that you see right in front of you that can be converted with our facilities. in Madison, Wisconsin, which you see right in front of you, which will allow us to control the integration of this Farm to Fuel platform so that when you are looking at site selection, you can put it where it's reliable, where you want it to be, and it can be fully integrated. You won't be dictated by the unreliabilities of these various feedstocks. Can we convert? Waste wood?