Company: FEAV
Filing Date: 2025-02-13
Form Type: 10-Q
Source: 0000950170-25-019943
Chunk: 131

Company: 5E Advanced Materials, Inc.
Filing Date: 2025-02-13
Form: 10-Q
Item: Item 2
Chunk 131
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 in Progress,” “Asset Retirement Obligations,” “Accounts Payable and Accrued Liabilities,” “Long-term Debt” and “Commitments and Contingencies” footnotes in the unaudited condensed consolidated financial statements for more information on certain of these expenditures and obligations.

Contractual Commitments and Contingencies

Purchase Obligations 

As of December 31, 2024, we had purchase order commitments of approximately $2.4 million primarily for raw materials for the operation of the SSF, engineering services for our proposed commercial-scale facility, drilling services related to wellfield development, testing and analytical services, and other services.

Future Capital Requirements 

Over the next 12 months we have the following plans that will require additional capital:

•Operate the SSF to provide the necessary data for our commercial-scale facility and progress our customer qualification program;

•Progress FEL-2, FEL-3, and detailed engineering;

•Optimize well-field design in an effort to reduce future mining capital and operational expenditure through various drilling techniques such as directional, horizontal, and radial drilling;

•Pursue and optimize infrastructure capital expenditures for our larger-scale facility which could include expansion of non-potable water resources, upgrading shore power, connection to a natural gas network, and constructing new access roads into and out of the location for our larger-scale facility; and

•Further define our advanced materials strategy with consideration to engineering and repurposing our SSF to produce boron advanced materials once sufficient data has been obtained for flow sheet optimization and the production of product for customer qualification.

Although the August 2024 Equity Offering, issuance of the September 2024 Notes and issuance of the January 2025 Notes each discussed above, improved our cash position, and we continue to operate under a business plan that includes reductions in certain spending, we will need additional financing within the next twelve months in order to continue as a going concern and, as long as the Convertible Notes remain outstanding, maintain a cash balance in excess of the $7.5 million minimum cash covenant contained in the Amended and Restated Note Purchase Agreement, which goes into effect March 31, 2025. Although the proposed Out-of-Court Restructuring (refer to the discussion above under the caption Recent Developments – Restructuring Support Agreement and Related Agreements) may provide additional capital to us through the equity that would be issued upon consummation of the transaction, and potential proceeds that may be received by us if the Restructuring Warrants