Company: FEAV
Filing Date: 2025-02-13
Form Type: 10-Q
Source: 0000950170-25-019943
Chunk: 42

Company: 5E Advanced Materials, Inc.
Filing Date: 2025-02-13
Form: 10-Q
Item: Item 8
Chunk 42
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 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 are subsequently exercised, the transaction remains subject to the satisfaction of customary conditions, including approval by the Company’s stockholders, which there can be no guarantee will occur. Absent additional financing as outlined above, we may no longer be able to meet our ongoing obligations, continue operations or achieve the milestones outlined above. If the Out-of-Court Restructuring is not consummated, and we are not able to secure additional financing and our cash balance falls below $7.5 million after March 31, 2025, an event of default under the Amended and Restated Note Purchase Agreement would occur if not cured after 30 days. An event of default would give the holders 

30

of the Convertible Notes the right to cause our Convertible Notes balance outstanding to become immediately due and payable, for which we would not have the resources to repay without additional financing.

We intend to explore different potential financing strategies to help support the growth of our business and execution of our business plan, including equity or debt financing, government funding or grants, private capital, royalty agreements or customer prepayments, or other strategic alliances with third parties. However, there is no assurance that we will be able to secure additional financing on adequate terms, in a timely manner, or at all. 

The receipt of any potential funding cannot be considered probable at this time because these plans are not entirely within our 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 for a period of one year after the date that the unaudited condensed consolidated financial statements included elsewhere in this Form 10-Q are issued. Even if additional financing is successfully consummated, available liquidity may still not be sufficient to eliminate 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