Company: FEAV
Filing Date: 2025-02-03
Form Type: DEF 14A
Source: 0000950170-25-012391
Chunk: 29

Company: 5E Advanced Materials, Inc.
Filing Date: 2025-02-03
Form: DEF 14A
Chunk 29
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| (1) | Includes restricted share units (“RSUs”), performance share units (“PSUs”), and DSUs. The number of shares subject to full-value awards outstanding reflects PSU awards outstanding based on the achievement of “target” performance goals.                                                                                                        |
| (2) | Represents the weighted-average exercise price of the applicable outstanding options. RSUs, PSUs, and DSUs outstanding under the Incentive Plan vest and convert to shares of Common Stock without the payment of consideration. Therefore, the weighted-average exercise price excludes RSUs, PSUs and DSUs outstanding under the Incentive Plan. |
| (3) | The Incentive Plan is the only equity plan under which we may currently grant new equity awards. The number of shares remaining available for future grant under the Incentive Plan reflects the number of PSU awards outstanding based on the achievement of “target” performance goals.                                                          |
| (4) | The Incentive Plan is the successor to the ABR Employee Share Option Plan.                                                                                                                                                                                                                                                                         |

Background of Determination of Shares Under the Amended Plan

As mentioned above, in its determination to approve the Amended Plan, the Board was primarily motivated by a desire to ensure the Company has an available pool of shares from which to grant long-term equity-based incentive awards, which the Board believes is an incentive and retention mechanism for our employees, consultants and non-employee directors. The Board considered key factors in making its determination including our historical grant rates, the shares remaining available for issuance under the Incentive Plan, and the potential dilution associated with the Incentive Plan.

This review included a consideration of the following key metrics, factors and philosophies:

In fiscal year 2024, we granted equity awards covering 1,156,470 shares of our Common Stock. On average, over the fiscal 2022-2024 period, we granted 1,409,477 shares annually. The amounts include PSUs based on the achievement of “target” performance goals.

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Our three-year average annual share pool usage over the most recently completed three-fiscal year period (or “burn rate”) was approximately 3.2%, as shown in the following table.

| Burn Rate Information      |     | FY 2022 |            |   |     | FY 2023 |            |   |     | FY 2024 |            |   |     | Three-Year Average  
 (FY 2022 – FY 2024