Company successfully executed and closed $150 million tax exempt bond offering for the Company's Kentucky Lithium refining facility

The first domestic, commercial producer of separated and high-purity REEs from recycled permanent magnets and high-purity battery elements from both ores and recycled feedstocks

Company's patented chromatographic separation and purification process defining itself as the world-leading critical mineral refining technology

Establishing first-of-their-kind partnerships pioneering full circular solutions for both rare earth elements and critical battery elements

Strong balance sheet provides financial strength and flexibility to execute on its innovation, collaboration and growth plans

Company to host update conference call today at 4:30 PM ET

FISHERS, IN / ACCESSWIRE / March 28, 2024 / American Resources Corporation (NASDAQ:AREC ) ("American Resources" or the "Company"), a next generation and socially responsible supplier of rare earth and critical elements, carbon and advanced carbon materials to the new infrastructure and electrification marketplace, today announced financial results for the full year ended December 31, 2023. The Company will host a conference call and webcast, today, March 28, 2024, at 4:30 PM ET (details below).

Mark Jensen, Chairman and CEO of American Resources Corporation commented, "Over the past year, we continued to see tremendous success in establishing our strategic positioning within the value chain of our addressable markets. Our strategic focus has been to position and prepare our business for growth as separate, standalone companies, and we have been putting the pieces in place to execute on that plan as we have previously discussed, and which is consistent with our Strategic Committee's plan of action to better unlock the value of American Resources. These steps include securing the appropriate growth capital to scale operations while also building word-class teams around each business. Our growth capital for American Carbon is largely supported by the closing of the previously announced tax-exempt bond offering for Wyoming County Coal (WCC), and we believe that complex will be a first class facility producing premium mid vol carbon for the global steel markets. Development of the WCC complex continues to progress and we are confident we will be producing from its first deep mine later this year as we continue to assess longer term options for our carbon platform, such as sales, leases, production and joint venture partnerships. Nonetheless, advancing WCC's development put the entire carbon platform is a much stronger position as one of the last U.S.-based metallurgical carbon growth platforms. Additionally, we very recently closed on a successful $150 million tax-exempt bond offering to fund the development of our Kentucky Lithium refining facility. It is becoming more evident that ReElement Technologies continues to separate itself as the most efficient critical mineral refining platform in the world. The critical and rare earth elements we refine today are imperative to operate our modern-day technology including electric vehicles, clean energy and defense applications. Our ability to produce a variety of ultra-pure, critical mineral products in a low-cost and environmentally safe commercial scale has put us in a unique position across several supply chains. As we continue to aggressively advance our platform technology and collaborate with partners, it is becoming more evident that we are the most efficient solution for the deployment of sustainable critical mineral refining outside of China. We continue to quietly position American Metals as an aggregator and processor of recycled feedstocks to feed into ReElement. American Metals is in a unique position to leverage ReElements advanced refining capabilities to handle the preprocessing step of end-of-life or off-spec batteries and magnets which also will enhance ReElements long-term margin profile. Lastly, as we continue to execute on our strategic plan, American Resource will continue to evolve by leveraging the unique capabilities and positioning of our current operating companies to diversify into other critical mineral and infrastructure resources to support energy transition and national security interests, similar to American Carbon's recent acquisition of a 51% interest in an iron ore and titanium resource deposit."

Key Division Highlights

The Company continues to aggressively drive innovative, efficient and solution-based steps to strengthen its position within its respective end-markets while strategically evolving to enhance shareholder value. Recent divisional milestones include:

ReElement Technologies

• Successfully executed and closed a Bond Purchase Agreement with Hilltop Securities Inc. for $150,000,000 principal amount of Kentucky Industrial Building Revenue Bonds, Series 2024, for the Company's Kentucky Lithium LLC ("KYL") complex which will be used for the development and operation commissioning of the United States' first-of-its-kind critical mineral refining facility.
• Established commercial partnership with a major U.S. auto manufacturer showcasing its low cost and environmentally friendly process to fully recycle and refine the high value rare-earth elements within EV motors back to ultra-pure magnet-grade rare-earth oxides, pioneering a sustainable and truly circular life-cycle solution to ensure that the rare earth elements remain within the domestic supply chain to build in America and stay in America.
• Established commercial partnership with EDP Renewables North America ("EDPR NA"), the world's fourth-largest wind energy producer and a top five owner and operator of renewables in North America, to advance sustainable practices in the wind energy sector with an initial focus on the efficient and sustainable recycling of neodymium-based permanent magnets from decommissioned wind turbines into magnet-grade rare earth elements, contributing to the development of a truly circular supply chain for renewable energy equipment and inputs.
• Executed MOU's with two German-based battery recycling platforms ( Duesenfeld GmbH , and Battery Damage Service GmbH ) to source recycled black mass battery material to be refined back to battery-grade lithium products such as lithium carbonate (Li ₂ CO ₃ ) and/or lithium hydroxide (LiOH) at its Marion, Indiana and Noblesville, Indiana refining facilities.
• Took a controlling interest in the former RCA Thomson manufacturing plant in Marion, Indiana, comprising approximately 425,000 square feet of manufacturing and refining capacity space on a 42-acre campus for ReElement Technologies' critical mineral refining facility, and subsequently closed on $44.9 million of local incentives from the City of Marion, Indiana to support the buildout of a state-of-the-art, commercial-scale lithium, critical minerals, and rare earth elements refining facility with a primary focus on recycled feedstocks.
• Continued to buildout its best-in-class team to drive operational expertise and strategic vision with the appointments of:
  • Ben Wrightsman, a well-established leader in the battery sector, as President;
  • Shane Tragethon, an operations and strategy expert with a large portion of his career supporting the United States Department of State's foreign assistance objectives and cooperation in Africa, as Vice President of International Strategy;
  • Ben Kincaid, a former U.S. Diplomat serving and leading teams in multiple countries in Africa, the Middle East, and South Asia as CEO of ReElement Africa Ltd.;
  • Former U.S. Ambassador, Mark Gilbert and former Vice Chairman of UBS Private Wealth Management as an Independent Director;
  • Kevin Higgins, a national security expert and former intelligence community senior executive who retired from the Central Intelligence Agency (CIA) after 30 years of distinguished service as an Independent Director; and
  • His Excellency Baba Kamara, former Ghanaian National Security Advisor and former Ghanaian Ambassador to Nigeria and current high-level official for Economic Community of West African States (ECOWAS) who will act in his individual capacity as an independent director of ReElement Africa Ltd.
• Achieved ultra-pure (99.96%) lithium carbonate (Li ₂ CO ₃ ) from its exclusively licensed and patented multi-modal chromatography technology from hard-rock, spodumene bearing pegmatite ore. This achievement comes after significant milestones of achieving 99.9978% pure Li ₂ CO ₃ from LFP battery manufacturing scrap at commercial scale; the first-known to achieve this worldwide, and 99.986% pure Li ₂ CO ₃ produced from recycled, end-of-life lithium-ion batteries, as well as achieving groundbreaking success as the first in the United States to produce greater than 99.5% pure magnet rare earth elements [dysprosium (Dy), neodymium (Nd) and praseodymium (Pr)] at commercial scale.

American Carbon

• Successfully closed its $45 million Tax-Exempt Industrial Development Bond offering through the West Virginia Economic Development Authority which will fund the expansion and technological improvements to the existing metallurgical carbon processing facility at its Wyoming County Coal (WCC) complex. This non-dilutive capital positions WCC as its next driver of growth which will support the development of two underground deep mines to produce premium, mid-vol metallurgical carbon, upgrade to the existing processing facility and development of its patented electrolysis technology to process associated waste streams into critical mineral concentrates.
• Acquired a 51% ownership interest in a Jamaica-based, diversified mineral asset with a focus on iron ore, titanium and vanadium to further establishes American Carbon's foothold in the steelmaking supply chain.

Corporate

• Recently distribute a majority of the shares it held in Novusterra Inc., via a special dividend, to the underlying shareholders of American Resources in conjunction with the Company's Special Committee's directive to better unlock value.
• Closed the merger between its sponsored, special purpose acquisition vehicle, American Acquisition Opportunity Inc., and Royalty Management Corporation (Nasdaq: RMCO) a next-generation royalty company targeting high value assets, cash flow and royalty streams by identifying undervalued assets while constructively supporting communities. The transaction positions RMCO to capitalize on organic and inorganic growth opportunities within the electrification and energy transition industry, natural resources, intellectual properties and ag-tech investments.
• Converted its wholly owned subsidiary, ReElement Technologies, from a LLC (limited liability company) to a corporation in preparation of its spinoff into a standalone public company under the name ReElement Technologies Corporation with a reserved ticker of RLMT.

"Looking forward to the remainder of 2024, our belief in and the excitement over the opportunities we have in front of us continues to reach an all-time high. Our goal is to successfully spin-off both ReElement Technologies and American Carbon this year with the appropriate value, capital structures and teams to execute as standalone businesses, and we feel confident we will accomplish that goal," continued Mr. Jensen.

"The opportunity for ReElement Technologies continues to manifest at a very rapid pace both domestically and internationally and continue to be bolstered by our tremendous team and growing partnerships. The unique attributes of our technology puts us in a lead position to successfully deploy meaningful critical mineral refining capacity outside of China. It has always been our approach that utilizing the similar, solvent-based separation and purification technologies, as used in China, will be a challenge for most of the developed world and we are starting to see those challenges manifest from an operational, cost and environmental perspective. As such, we believe we stand alone in our ability to produce ultra-pure products at large scale, and in an environmentally-safe and cost competitive process. This has enabled us to advanced our focus on customer qualifications across multiple supply chains, procuring appropriate feedstocks to feed our large-scale projects, securing offtake agreements with both planned magnet, cathode / battery manufacturers and designing and engineering our planned large-scale, commercial facilities. Our rapid execution of this tremendous growth opportunity is evidenced by the technical expertise at our Noblesville, Indiana Commercial Qualification Plant, the acquisition of our Marion, Indiana super-site, the procurement of approximately $45 million in tax incentives from the municipality of Marion, and the successful execution of a bond purchase agreement for $150 million of Kentucky Industrial Building Revenue Bonds for our first-of-its-kind Kentucky Lithium refinery, to name a few. Additionally, our international growth plans are substantial, especially with unlocking the value of certain African regions, to support a massive shift in global trade and manufacturing. ReElement sits in a very opportunistic position at the intersection of energy transition and national security and we remain steadfast on executing smartly yet swiftly to build substantial value for our Company, shareholders and stakeholders a like."

Expected Near-Term Catalysts

• Additional ReElement Technologies upstream and downstream partnerships to bolster feedstocks of end-of-life products, manufacturing scrap and ores for critical and REEs and offtake customers of sustainable and domestic sources of high-purity battery and magnet materials.
• Broader international expansion of ReElement Technologies' world-leading critical mineral platform for both critical mineral-based ores and recycling partnerships.
• Continue to scale critical mineral refining capacity at its next two large-scale facilities in Marion, Indiana and Knott County, Kentucky and through co-located facilities with supply chain partners.
• Continue to add best-in-class talent to drive the execution of each division.
• Monetization of American Carbon through its spin-off, increase in carbon production to meet market demand, leases, joint ventures and/or divestitures.

Conference Call Information

American Resources management will host a conference call for investors, analysts and other interested parties today, Thursday, March 28, 2024 at 4:30 PM ET.

Interested participants and investors may access the conference call by dialing 877-407-4019 and referencing American Resources Corporation's Fourth Quarter and Year End 2023 Conference Call, or by the webcast link: here .

Financial Results for the Year-Ending December 31, 2023

For the full year of 2023, American Resources reported a net income loss of $11.2 million or a loss of $0.15 per share for the twelve months ended December 31, 2023, as compared with a net income loss $1.45 million or loss of $0.02 per share for the full year of 2022. The Company earned an adjusted earnings before interest, taxes, depreciation, amortization, accretion on asset retirement obligations, non-operating expenses and non-cash impairment loss (‘adjusted EBITDA") of $6.1 million for the year ended December 31, 2023, as compared with earning adjusted EBITDA of $6.5 million in 2022.

Full Year 2023 Summary

Full year 2023 revenues were $16.7 million compared to full year 2022 revenues of $39.5 million. The Company's annual decline in revenue was attributed to a shift in prioritizing its use of capital towards accelerating its ReElement Technologies division to position it for accelerated growth and in preparation for its planned spin-off into a standalone company, while securing and beginning to deploy its growth capital for its American Carbon division, supported by its $45 million tax exempt bond it closed to develop its WCC complex and preparing American Carbon for its planned spin-off into a standalone company. Development costs during 2023 were $11.7 million compared to $28.1 million during 2022 and better positions the Company within the markets in which it serves and to meet growing demand.

The Company did not incur any income tax expense in 2023 as it was able to utilize its available net operating losses ("NOL") carried forward from prior periods of approximately $25.7 million as of December 31, 2023.

AMERICAN RESOURCES CORPORATION
CONSOLIDATED STATEMENTS OF OPERATIONS