Company: FEAV
Filing Date: 2025-01-17
Form Type: DEFA14A
Source: 0000950170-25-006729
Chunk: 5

Company: 5E Advanced Materials, Inc.
Filing Date: 2025-01-17
Form: DEFA14A
Chunk 5
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 the cap structure, any rights under the notes, but this is contingent upon a successful vote and that's going to be required.

And from approximately the 80 percent level, this was agreed based on a negotiation that really struck a balance between what are shareholders interest, Hey, we needed money now, and in capital to continue funding the business, and then it compensates the lenders with an ownership level that they're comfortable to equitize and really give up that, that seniority in the capital structure.

Romeo Maione

6ix

I appreciate that. Another one that was written in. Why weren't existing shareholders given the luck to participate at these levels?

Paul Weibel

CEO

Yeah, I think this dovetails on the back of the last question, which is like one leads to another, but we did test the markets on three different occasions and we had spoken with various groups of larger shareholders. And there's no term sheets submitted and I was on an Australian trip in July and kind of walking through, what, where we are today, where we're going.

And someone told me like, I am investing. I am buying the stock as, as long as the notes are there. And people were candid about the notes and they were a barrier for whether it's issuing capital or buying in the open market. And so as we, kind of into December, we really needed to work through a structure to equitize the notes and secure immediate funding as essentially we had a cash covenant that had relief, but that was expiring December 31st and so as we knew we needed to solve for that and those were our two priority items.

And so having an on lever balance sheet that really is healthy. With no debt really sets up the company for a longer term success and positions the company to to excel operationally, I'll say that the RSA docs do restrict our ability to offer securities during the pendency of this transaction without lenders consent, you know, but our board, our lenders understand that.

Listen, this is a 300 million project and there's going to be additional capital required.

Romeo Maione

6ix

Appreciate that too. So one question, now that you're free from the restrictive debt levels, what are the anticipated use of funds in the near term?

Paul Weibel

CEO

Listen, I think restructuring aside, like we're business as usual here and we're focused on delivering funds that are going to go to continuing production of boric acid for customer qualification.