NEO Battery Partners with Korean Drone Manufacturer to Develop & Supply High-Performance Battery Solutions

• First publicly disclosed drone customer follows positive testing and validation of Company’s high-performance battery products within drone systems
• Strategic collaboration to replace Chinese-manufactured batteries with NEO’s products and deploy across Korean military procurement and solicitations
• Multi-phase, recurring partnership to develop and supply high-performance battery solutions to customer’s current and upcoming drone platforms

TORONTO, July 16, 2026 /CNW/ — NEO Battery Materials Ltd. (“NEO” or the “Company“) (TSXV: NBM) (OTC: NBMFF), a low-cost, silicon-enhanced battery manufacturer enabling high-performance capabilities for drones, robotics, and physical AI, is pleased to announce a defense partnership via a joint development agreement (JDA) signed on July 15, 2026, with Assetta Inc. (“Assetta” or the “Customer“), a South Korean drone and aerospace company, to develop and manufacture high-performance, non-Chinese battery products for Assetta’s current and upcoming drone platforms.

The partnership represents NEO’s first publicly disclosed drone customer and follows positive testing and validation of the Company’s battery products within the Customer’s drone systems. The strategic collaborative aim is to fully replace the Chinese-manufactured batteries used in Assetta’s platforms today, advancing both companies’ commitment to secure reliable supply chains free of Foreign Entities of Concern (FEOC) as defined by the One Big Beautiful Bill Act (OBBBA).

“Following our evaluation, Assetta intends to strategically transition our current drone batteries to NEO’s products and to deploy them primarily across our Korean defense contracts and solicitations, ” said Mr. Hyung-Jun Kim, CEO of Assetta. ” Within South Korea and Western-allied markets, NEO uniquely provides capabilities of end-to-end battery solutions and high-quality expertise from global battery makers that can flexibly adapt to changes in performance needs to meet the evolving needs of our products.“

Assetta develops and manufactures military-grade, lightweight reconnaissance VTOL (vertical take-off and landing) systems, fibre-optic drones in collaboration with LS Cable & System (a subsidiary of the Korean conglomerate, LS Group), and relevant drone components and software. Serving dual-use markets, including precision agriculture, logistics, and surveying/mapping, Assetta was recently selected for the Republic of Korea Army’s inaugural Drone Combat Challenge to test and evaluate Korean-made unmanned aerial systems (UAS) and counter-UAS (cUAS) technologies for battlefield deployment.

On a recurring basis, NEO will develop and supply system-specific battery solutions for Assetta’s diverse suite of drone platforms. The project aims to deliver optimized products that enhance flight time, payload capacity, energy/power density, and overall operational efficiency, with the objective of creating cost-competitive alternatives through FEOC manufacturing. Assetta will conduct field testing and validation to expedite commercial integration of newly developed products.

“This agreement represents an operational advancement for a long-term customer relationship that we intend to scale alongside Assetta’s innovations and upcoming production programs,” said Mr. Spencer Huh, CEO of NEO. “The Company is gradually expanding its drone customer pipeline as part of the Korea Defense Integration Strategy. The go-to-market plans are not to form a plain supplier-vendor relationship, but NEO is employing a proactive approach in jointly collaborating to develop and supply long-range, high-power solutions that directly replace reliance on non-allied technologies.”

About Assetta Inc.
Assetta is a specialized Korean aerospace company developing and manufacturing drone and unmanned aerial vehicles (UAV) for defense and industrial purposes. Assetta retains various drone products from corrugated cardboard drones for stealth and deep infiltration combat environments, fixed-wing VTOL for long-range reconnaissance, surveillance, and map surveying, and fiber-optic/tethered drones. Assetta further specializes in components and software architecture for fleet automation. For more information, please visit the Company’s website at: https://assetta.co.kr/ 

About NEO Battery Materials Ltd.
NEO Battery Materials is a Canadian-South Korean battery technology company focused on developing and producing silicon-enhanced lithium-ion batteries in drones, robotics, physical AI, electric vehicles, and energy storage systems. With a patent-protected, low-cost silicon manufacturing process, NEO Battery enables longer-running and ultra-fast charging properties and provides end-to-end battery solutions from materials selection, cell architecture, and process optimization. The Company aims to be a globally-leading producer of high-performance lithium-ion batteries and materials, building a secure, robust battery supply chain for Western manufacturers. For more information, please visit the Company’s website at: https://www.neobatterymaterials.com/.

On Behalf of the Board of Directors
Spencer Huh
Director, President, and CEO

This news release includes certain forward-looking statements as well as management’s objectives, strategies, beliefs and intentions. All information contained herein that is not clearly historical in nature may constitute forward-looking information. Generally, such forward-looking information can be identified notably by the use of forward-looking terminology such as “plans”, “expects” or “does not expect”, “is expected”, “budget”, “scheduled”, “estimates”, “forecasts”, “intends”, “anticipates” or “does not anticipate”, or “believes”, or variations of such words and phrases or state that certain actions, events or results “may”, “could”, “would”, “might” or “will be taken”, “occur” or “be achieved”. Forward-looking information is subject to known and unknown risks, uncertainties and other factors that may cause the actual results, level of activity, performance or achievements of the Company to be materially different from those expressed or implied by such forward-looking information, including but not limited to: volatile stock prices; the general global markets and economic conditions; the possibility of write-downs and impairments; the risk associated with the research and development of battery-related technologies; the risk associated with the effectiveness and feasibility of battery material, electrode, and cell technologies that have not yet been tested or proven on commercial scale or under real-world operating conditions; the risks associated with battery-related manufacturing process scale-up, including maintaining consistent material, component, and cell quality, production yields, and process reproducibility at a pilot, semi-commercial, or commercial scale; the risks associated with compatibility of existing battery chemistries, formulations, components, or designs; unforeseen risks associated with entering into and maintaining collaborations, joint ventures, partnerships, or commercial contracts with battery cell manufacturers, original equipment manufacturers, and various companies in the global battery and downstream end-user supply chain; the risks associated with the failure to develop and produce commercially viable battery-related products or that technical goals may not be achieved within expected timelines or budgets under a joint development or collaboration; the risks associated with the Company’s technologies and products not meeting performance requirements or customer specifications; the risks that prototype and pilot-scale products do not advance into commercially produced products or translate into commercial orders; the risk associated with battery components and cell purchase orders and offtake supply that may not be fulfilled in full, on time, or at all as actual revenue realization depends on delivery schedules, achievement of technical milestones, and customer acceptance and validation; the risk associated with losing official vendor registration or status with existing customers; counterparty risk upon delivery of prototype and commercial products; the risks associated with constructing, completing, securing, and financing pilot, semi-commercial, and commercial battery materials, components, and cell manufacturing facilities including the Canadian and South Korean facilities; the risks associated with potential delays or increased costs with site preparation, equipment procurement and installation, and facility commissioning; the risks associated with integrating silicon anode material production, electrode manufacturing, and cell assembly within a single operational cluster or the Company’s business portfolio; the risks associated with supply chain disruptions or cost fluctuations in raw materials, processing chemicals, and additive prices, impacting production costs and commercial viability; the risks associated with uninsurable risks arising during the course of research, development and production; competition faced by the Company in securing experienced personnel, contracts and sales, and financing; access to adequate infrastructure and resources to support battery materials, components, and cell research and development activities; the risks associated with changes in the technology regulatory regime governing the Company; the risks associated with the timely execution of the Company’s strategies and business plans; the risks associated with the lithium-ion battery industry and end-users’ demand and adoption of the Company’s silicon anode technology and battery products; market adoption and integration challenges, including the difficulty of incorporating silicon anodes and silicon battery products within battery manufacturers and OEMs’ systems; the risks associated with the various environmental and political regulations the Company is subject to; risks related to regulatory and permitting delays; the reliance on key personnel; liquidity risks; the risk of litigation; risk management; and other risk factors as identified in the Company’s recent Financial Statements and MD&A and in recent securities filings for the Company which are available on www.sedarplus.ca. Forward-looking information is based on assumptions management believes to be reasonable at the time such statements are made, including but not limited to, continued R&D and commercialization activities, no material adverse change in precursor, raw material, equipment, and relevant cost prices, development and commercialization plans to proceed in accordance with plans and such plans to achieve their stated expected outcomes, receipt of required regulatory approvals, and such other assumptions and factors as set out herein. Although the Company has attempted to identify important factors that could cause actual results to differ materially from those contained in the forward-looking information, there may be other factors that cause results not to be as anticipated, estimated or intended. There can be no assurance that such forward-looking information will prove to be accurate, as actual results and future events could differ materially from those anticipated in such forward-looking information. Such forward-looking information has been provided for the purpose of assisting investors in understanding the Company’s business, operations, research and development, and commercialization plans and may not be appropriate for other purposes. Accordingly, readers should not place undue reliance on forward-looking information. Forward-looking information is made as of the date of this presentation, and the Company does not undertake to update such forward-looking information except in accordance with applicable securities laws.

Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.

SOURCE NEO Battery Materials Ltd.