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MEMORANDUM OF AGREEMENT This Memorandum of Agreement (“ Agreement”) is hereby
entered into by and between Aqua Metals Reno, Inc. (“Aqua Metals”) and Veritex
Community Bank (“Veritex”). This Agreement is effective on the date that both
parties execute the Agreement (“Effective Date”). WHEREAS Aqua Metals is
indebted to Veritex pursuant to a Promissory Note dated November 3, 2015, and a
Loan Agreement which was amended effective March 30, 2017 (collectively “Loan
Agreements”); and WHEREAS the United States Department of Agriculture Rural
Development (“USDA”) has guaranteed a portion of Aqua Metals’ indebtedness under
the Loan Agreements; and WHEREAS Aqua Metals’ indebtedness to Veritex under the
Loan Agreements is secured by collateral (“Collateral”), which includes real
property, personal property, and a certificate of deposit (“Certificate of
Deposit”), each as described in the Loan Agreements, a Security Agreement, and a
Deed of Trust; and WHEREAS on or about November 29, 2019, Aqua Metals’ property
sustained damage from a fire (“Fire Damage”) in the AquaRefining area of the
property; and WHEREAS Aqua Metals is insured for the losses resulting from the
Fire Damage under a series of property insurance policies (“Insurance Policies”)
as follows: First Layer: issued by Navigators Specialty Insurance Company,
$5,000,000 limits; Second Layer: issued by Arch Specialty Insurance Company,
$7,500,000 limits; Third Layer: issued by Starr Surplus Lines Insurance Company,
$12,500,000 limits; Fourth Layer: issued by Homeland Insurance Company of New
York, $25,000,000 limits; and WHEREAS Aqua Metals has presented a claim under
the Insurance Policies for the Fire Damage; and WHEREAS Navigators Specialty
Insurance Company has paid $5,000,000 on the First Layer of the Insurance
Policies; and WHEREAS Aqua Metals has received $4,200,000 of the proceeds from
the First Layer; and WHEREAS the remaining $800,000 paid from the First Layer is
currently in an escrow account at Veritex (“Escrow Account”); and WHEREAS Arch
Specialty Insurance Company has paid $5,000,000 from the Second Layer of the
Insurance Policies, which sum is currently in the Escrow Account; and MEMORANDUM
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WHEREAS Aqua Metals and Veritex desire to enter into this agreement regarding
distributions and application of proceeds from the Insurance Policies, any sales
of Collateral, and the satisfaction of Aqua Metals’ indebtedness and obligations
under the Loan Agreements; NOW, THEREFORE, in consideration of the provisions
below, and other good and valuable consideration, the receipt, adequacy and
sufficiency of which are hereby acknowledged by all parties to this agreement,
Aqua Metals and Veritex agree as follows: 1. Agreement regarding First Layer
Proceeds: Veritex and Aqua Metals agree that within 5 business days from the
Effective Date (a) Veritex will release an additional $300,000 from the Escrow
Account received from the First Layer to Aqua Metals; and (b) Veritex will
retain $500,000 in the Escrow Account from the First Layer. 2. Agreement
regarding Second Layer Proceeds Received as of Effective Date: Veritex and Aqua
Metals agree that within 5 business days from the effective date of this
agreement (a) Veritex will release $2,750,000 from the Escrow Account to Aqua
Metals; and (b) Veritex will retain $2,250,000 in the Escrow Account. 3.
Agreement regarding Second Layer Proceeds Received after Effective Date: Veritex
and Aqua Metals agree that with respect to all future proceeds received from the
Second Layer: (a) Veritex will release to Aqua Metals 55% of the proceeds
received; and (b) Veritex will retain 40% of the proceeds received in the Escrow
Agreement. 4. Agreement regarding Third Layer Proceeds Received: Veritex and
Aqua Metals agree that with respect to all proceeds received from the Third
Layer: (a) Veritex will release to Aqua Metals 60% of the proceeds received; and
(b) Veritex will retain 40% of the proceeds received in the Escrow Agreement. 5.
Agreement regarding Sale of Aqua Metals’ real estate collateral: To the extent
Aqua Metals sells any real estate that is part of the Collateral securing Aqua
Metals’ indebtedness under the Loan Agreements, Aqua Metals agrees that 100% of
the proceeds from such sale will be provided to Veritex and such proceeds shall
be placed into the Escrow Account. 6. Agreement regarding Sale of Aqua Metals’
non-real estate Collateral: To the extent Aqua Metals sells any Collateral other
than real estate, Aqua Metals and Veritex agree that the proceeds from such sale
shall, subject to the USDA’ s express consent following receipt of such
proceeds, be divided as follows: (a) 50% of the proceeds shall be provided to
Aqua Metals free and clear of Veritex’s lien; and (b) 50% of the proceeds shall
be provided to Veritex and such proceeds shall be placed into the Escrow
Account. 7. Agreement to Continue to Make Scheduled Payments Required by the
Loan Agreement: Aqua Metals agrees that it will continue to timely make all
payments due under the Loan Agreement notwithstanding the receipt, disbursement,
or application of proceeds from Insurance Policies or any sales of assets as
described MEMORANDUM OF AGREEMENT – Page 2 of 4 ACTIVE 49720872v1

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above. Aqua Metals further agrees to timely make all payments to taxing
authorities and to maintain insurance coverage as required by the Loan
Agreements. 8. Agreement regarding the Application of funds in the Escrow
Account and the Certificate of Deposit: The parties agree that when the total of
the funds in the Escrow Account plus the funds in the Certificate of Deposit
becomes equal to or greater than the sum of (a) Aqua Metals’ indebtedness under
the Loan Agreement, and (b) the “Prepayment Consideration” amount owed in the
event of a prepayment of the indebtedness as described in the Loan Agreements,
then Veritex shall apply the funds in the Escrow Account and the Certificate of
Deposit to fully satisfy (a) the indebtedness under the Loan Agreement including
all principal, accrued interest, and any other sums owed under the Loan
Agreement, and (b) the Prepayment Consideration owed as a result of the
prepayment of principal owed under the Loan Agreements. Thereafter, any
remaining funds in the Escrow Account shall be disbursed to Aqua Metals. 9. The
Parties further agree that, except as otherwise expressly provided herein, all
of Veritex’s liens and security interests in the Collateral will remain
effective and enforceable pursuant to the terms of the Loan Agreement until Aqua
Metals’ indebtedness and obligations under the Loan Agreement are fully paid and
discharged pursuant to paragraph 8 above. 10. This Agreement shall not modify
any other terms under the Loan Agreement except as expressly stated herein.
AGREED: AQUA RENO METALS, INC. VERITEX COMMUNITY BANK By: /s/ Judd Merrill By:
/s/ William Alt Judd Merrill William Alt CFO Senior Credit Officer Date:
3/25/2020 Date: 3/25/2020 MEMORANDUM OF AGREEMENT – Page 3 of 4 ACTIVE
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AGREED BY GUARANTORS: AQUA METALS, INC. By: /s/ Judd Merrill Judd Merrill CFO
Date: 3/25/2020 AQUA METALS OPERATIONS, INC. By: /s/ Judd Merrill Judd Merrill
CFO Date: 3/25/2020 MEMORANDUM OF AGREEMENT – Page 4 of 4 ACTIVE 49720872v1

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