Company: FEAV
Filing Date: 2025-01-24
Form Type: PRE 14A
Source: 0000950170-25-008828
Chunk: 135

Company: 5E Advanced Materials, Inc.
Filing Date: 2025-01-24
Form: PRE 14A
Chunk 135
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 Restated Note Purchase Agreement permits a change to the Conversion Rates applicable to the June 2024 Notes and September 2024 Notes upon a Digressive Issuance by the Company on or before December 31, 2024. As a result, these conversion features were deemed to be embedded derivatives requiring bifurcation and separate accounting as stand-alone derivative instruments (the “June 2024 Convertible Note Derivative” and “September 2024 Convertible Note Derivative,” respectively, and together, the “Convertible Note Derivatives”). The June 2024 Notes were initially recorded at their face amount of $6 million less debt issuance costs of $541 thousand and the fair value of the June 2024 Convertible Note Derivative, which was determined to be $4.1 million. Similarly, the September 2024 Notes were initially recorded at their face amount of $6 million less debt issuance costs of $454 thousand and the fair value of the September 2024 Convertible Note Derivative, which was determined to be $1.6 million.

The provisions that result in separate accounting for the Convertible Note Derivatives will expire on December 31, 2024, and accordingly, the fair value of the Convertible Note Derivatives, if any, on such date will be transferred to additional paid-in capital. Refer to Note 8–Convertible Note Derivatives and the discussion immediately below for additional details regarding the fair values of the Convertible Note Derivatives.

Convertible Notes - Fair Value

Fair value and carrying value information for the Convertible Notes at each period end follows.

| As of September 30, 2024                |     | Principal      
 Amount         
 (in thousands) |        |     | Unamortized Debt 
 Discount and     
 Issuance Costs   |        |   |     | Net Liability 
 Carrying      
 Amount        |        |     | Fair Value 
 Amount     |        |     |    | Leveling |
|:----------------------------------------|:----|:---------------|-------:|:----|:-----------------|:-------|:--|:----|:--------------|-------:|:----|:-----------|-------:|:----|---:|:---------|
| August 2022 Notes, due Aug. 15, 2028    |     | $              | 68,955 |     | $                | (2,197 | ) |     | $             | 66,758 |     | $          |