5E Advanced Materials Inc

9. Equity

The Company is authorized to issue up to 360,000,000 shares of common stock, par value $0.01 per share, and 20,000,000 shares of preferred stock, par value, $0.01 per share. The Company hasno outstanding shares of preferred stock.

On January 18, 2024, as part of the Out-of-Court Restructuring, and pursuant to a subscription agreement with Ascend, dated December 5, 2023 and an amended and restated subscription agreement with 5ECAP LLC (“5ECAP”), dated January 18, 2024 (the “5ECAP Subscription Agreement”), the Company issued (i)5,365,854 shares of Common Stock to Ascend at a price of $1.025 per share, which shares included the placement fee to Ascend in shares of Common Stock and (ii)5,365,854 shares of Common Stock to 5ECAP at a price of $1.025 per share, which shares included the placement fee to 5ECAP in shares of Common Stock. Then, on January 29, 2024, also as part of the Out-of-Court Restructuring and pursuant to the 5ECAP Subscription Agreement, the Company issued an additional 8,317,074 shares of Common Stock to 5ECAP at a price of $1.025 per share. These transactions resulted in net proceeds to the Company of $15.8 million. In addition to these share issuances, during the year ended June 30, 2024,82 thousand shares of Common Stock were issued upon the vesting of certain equity awards, which didnot result in any net cash proceeds to the Company.

As discussed in Note 15—Subsequent Events, on August 27, 2024, the Company issued (i)5,333,333 shares (the “Shares”) of Common Stock, (ii) Series A warrants to purchase up to an aggregate of up to 5,333,333 shares of Common Stock (the “Series A Warrants”) and (iii) Series B warrants to purchase an aggregate of 5,333,333 shares of Common Stock (the “Series B Warrants”, and collectively with the Series A Warrants, the “Warrants”). The Shares and Warrants were offered and sold on a combined basis for consideration equating to $0.75 for one Share and two Warrants. The exercise price for each of the Warrants is $0.7981 per share. This transactions resulted in gross proceeds to the Company of approximately $4.0 million before deducting the placement agent’s fees and other offering expenses.

During the year ended June 30, 2023, the Company issued 882 thousand shares of its Common Stock for net cash proceeds of $3.4 million upon the exercise of stock options and vesting of equity awards.

2024 Equity Distribution Agreement

On March 28, 2024, the Company entered into an equity distribution agreement (the “Equity Distribution Agreement”) with Canaccord Genuity LLC and D.A. Davidson & Co. (the “Agents”) pursuant to which the Company may offer and sell up to $15.0 million of shares of Common Stock from time to time through the Agents, acting as the Company’s sales agents, or directly to one or more of the Agents, acting as principal (the “ATM Program”).

Neither of the Agents is required to sell any specific number or dollar amount of shares of the Company’s Common Stock, but each has agreed, subject to the terms and conditions of the Equity Distribution Agreement, to use its commercially reasonable efforts, consistent with its normal trading and sales practices, to sell the shares of Common Stock on the terms agreed upon by such Agent and the Company.

The Company did not sell any shares of Common Stock nor receive any proceeds under the Equity Distribution Agreement during the year ended June 30, 2024. As a result of the August 2024 Offering (as defined in Note 15—Subsequent Events) we are precluded from utilizing the ATM program for one year following the closing of the offering.