Mr. Hanre Rossouw reports

NEXTSOURCE MATERIALS EXECUTES TERM SHEETS WITH STRATEGIC INVESTORS AND LOCAL CAPITAL PARTNERS TO ADVANCE TOWARDS FINAL INVESTMENT DECISION FOR ITS PROPOSED UAE BATTERY ANODE FACILITY

NextSource Materials Inc. has finalized multiple term sheets with strategic investors to finance phase 1 of the company's proposed battery anode facility (BAF) in the industrial city of Abu Dhabi in the United Arab Emirates. These term sheets indicate substantial progress in the company's strategic financing process and further reinforces the company's path toward the final investment decision (FID).

The company has finalized term sheets with several strategic investors, including local sovereign-linked entities and a Japanese strategic consortium including a diversified industrial trading group with deep experience across the global battery materials and infrastructure sectors. This follows the successful conclusion of the first stage of due diligence and the investor site visit held on Nov. 25, 2025, to the industrial building and site secured for the location of the company's proposed BAF in the industrial city of Abu Dhabi.

The term sheets propose an equity investment at the project level in the BAF project under which new strategic partners would potentially acquire an interest of up to 50 per cent in the UAE BAF and subsequently finance their pro rata share of phase 1 capital costs. This approach aligns with NextSource's objective to minimize dilution of the company while potentially partnering with investors that bring strategic and regional value to the BAF project and across the battery supply chain.

The term sheets executed are non-binding and subject to customary conditions. The company is now advancing next steps with these parties, alongside continuing technical, commercial and legal due diligence, with a view toward potentially finalizing a preferred funding structure and executing definitive agreements in the coming months.

Hanre Rossouw, president and chief executive officer of NextSource, commented:

"The level and quality of funding interest we are seeing at the project level is a strong validation of our UAE BAF strategy. These strategic investors recognize the importance of establishing secure, scalable and geopolitically aligned anode supply chains outside of China. This process marks a significant first step toward funding our first commercial-scale BAF."

The company is currently advancing parallel workstreams to reach FID by the end of Q1 2026, supported by strong progress in the front-end engineering and design with its engineering partner firm, Stantec. Following a prospective successful FID and funding, the company will proceed with full equipment procurement, installation, commissioning and ramp-up in accordance with its phased development plan.

About NextSource Materials Inc.

NextSource Materials is a battery materials company based in Toronto, Canada, that is intent on becoming a vertically integrated global supplier of battery materials through the mining and value-added processing of graphite and other minerals.

The company's Molo graphite project in Madagascar is one of the largest known and highest-quality graphite resources globally, and the only one with SuperFlake graphite. The Molo mine has begun production through phase 1 mine operations.

The company is also developing a significant downstream graphite value-add business through the staged rollout of battery anode facilities (BAF) capable of large-scale production of coated, spheronized and purified graphite for direct delivery to battery and automotive customers, in a fully transparent and traceable manner. The company is now in the process of developing its first BAF in the UAE.

NextSource Materials is listed on the Toronto Stock Exchange under the symbol NEXT and on the OTCQB under the symbol NSRCF.

We seek Safe Harbor.