Company: FEAV
Filing Date: 2025-02-13
Form Type: 10-Q
Source: 0000950170-25-019943
Chunk: 29

Company: 5E Advanced Materials, Inc.
Filing Date: 2025-02-13
Form: 10-Q
Item: Item 8
Chunk 29
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 and variable operating costs and increasing our efficiency at current production level at the SSF. We estimate that this initiative could allow us to save approximately $2.2 million in operating expenditures during calendar year 2025. 

Financing Highlights

Refer to the discussion above under the headings Recent Developments – Restructuring Support Agreement and Related Agreements, and January 2025 Notes.

Financing Transactions — Liquidity Considerations

Although the January 2025 Notes improved our cash position by providing an aggregate of $5.0 million of proceeds to the Company prior to recognition of issuance costs and fees, and we continue to operate under a business plan that includes reductions in certain spending, we will need additional financing in order to continue as a going concern and, as long as the Convertible Notes are outstanding, maintain a cash balance in excess of the $7.5 million minimum cash covenant contained in the Amended and Restated Note Purchase Agreement (as discussed in Note 7–Debt to the unaudited condensed consolidated financial statements). An event of default under the September 2024 Amended and Restated Note Purchase Agreement would give the holders of the Convertible Notes the right to cause all of our Convertible Notes to become immediately due and payable, for which we would not have the resources to repay without additional financing. The receipt of potential funding cannot be considered probable at this time because these plans are not entirely within management's control as of the date of the unaudited condensed consolidated financial statements. Therefore, there exists substantial doubt regarding our ability to continue as a going concern. Even if additional financing is successfully consummated, including as part of the proposed Out-of-Court Restructuring, available liquidity may still not be sufficient to eliminate 

24

the aforementioned substantial doubt regarding our ability to continue as a going concern. Refer to the “Going Concern” discussion within Note 1–Basis of Financial Statement Presentation of the unaudited condensed consolidated financial statements and “Liquidity and Capital Resources” below for more information.

Results of Operations 

The following table summarizes our results of operations for the periods presented.

    Three Months Ended December 31,

    Variance

    Six Months Ended December 31,

    Variance

    2024

    2023

    $

    %

    2024

    2023

    $

    %

    (in thousands)

    (in thousands)

    COSTS AND EXPENSES

    Project expenses
     
    $
    1,679