5E Advanced Materials Inc

PROPOSAL SIX

TO APPROVE A POTENTIAL FUTURE PRIVATE OFFERING

The Company’s common stock is currently listed on The Nasdaq Global Select Market, and, as such, the Company is subject to the Nasdaq Listing Rules. As discussed above in Proposal Five, Nasdaq Listing Rule 5635(d) requires the Company to obtain stockholder approval prior to the issuance of securities in a transaction, other than a public offering, involving the sale, issuance or potential issuance by the Company of common stock (or securities convertible into or exercisable for common stock), which equals 20% or more of the common stock or 20% or more of the voting power outstanding before the issuance, at a price less than the lower of: (i) the closing price immediately preceding the signing of the binding agreement or (ii) the average closing price of the common stock for the five trading days immediately preceding the signing of the binding agreement for the transaction. Shares of the Company’s common stock issuable upon the exercise or conversion of warrants, options, debt instruments, preferred stock or other equity securities issued or granted in such non-public offerings will be considered shares issued in such a transaction in determining whether the 20% limit has been reached, except in certain circumstances, such as issuing warrants that are not exercisable for a minimum of six months and have an exercise price that exceeds market value. As discussed above in Proposal Five, in considering a listed company’s compliance with Nasdaq Listing Rule 5635(d), Nasdaq also reserves discretion to determine whether shares issued in separate transactions should be aggregated for purposes of calculating whether a company has issued or agreed to issue 20% or more of its common stock. During August 2024, the Company issued shares of common stock in a capital-raising activity that it believes Nasdaq could determine should be aggregated with future capital-raising activities of the Company, depending on the facts and circumstances surrounding such activities.

As disclosed in its Quarterly Report on Form 10-Q for the period ended September 30, 2024, management concluded that there was substantial doubt about the Company’s ability to continue as a going concern, and that the Company would need additional financing in order to continue as a going concern and 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 December 31, 2024. As of September 30, 2024, the Company had cash and cash equivalents of $6.8 million.

In addition, as previously disclosed by the Company, on November 20, 2024, the Company received a written notice from Nasdaq notifying the Company that the Company was not in compliance with the minimum stockholders’ equity requirement set forth in Nasdaq Listing Rule 5450(b)(1), which requires companies listed on the Nasdaq Global Select Market to maintain a minimum of $10,000,000 in stockholders’ equity for continued listing (the “Stockholders’ Equity Rule”). The Company’s Quarterly Report on Form 10-Q for the period ended September 30, 2024 reported stockholders’ equity of $2,094,000 as of September 30, 2024. In accordance with Nasdaq Listing Rule 5810(c)(2)(A), the Company has been provided 45 calendar days, or until January 6, 2025, to submit a plan to regain compliance (the “Compliance Plan”). If the Compliance Plan is accepted, Nasdaq may grant an extension of up to 180 calendar days from the date of the Notice to evidence compliance. If Nasdaq does not accept the Compliance Plan, the Company will have the opportunity to appeal that decision to a Nasdaq Hearings Panel. The Company intends to submit the Compliance Plan on or before January 6, 2025. However, there can be no assurance that the Company will submit the Compliance Plan in a timely manner or that Nasdaq will grant the Company any extension of time to regain compliance with the Stockholders’ Equity Rule or that the Company will regain compliance with the Stockholders’ Equity Requirement or otherwise maintain compliance with any of the other listing requirements. The ability to raise equity, and to do so with the increased flexibility that approval of this proposal would provide, will help to facilitate our ability to regain compliance with the Stockholders’ Equity Rule.

In light of the foregoing, the Company may seek to raise additional capital to bolster its liquidity profile, regain compliance with Nasdaq listing rules, implement its business strategy and enhance its overall capitalization. It has not determined the particular terms for such prospective offerings. Because the Company may seek additional capital that triggers the requirements of Nasdaq Listing Rule 5635(d), it is seeking stockholder approval now, so that it may take full advantage of any opportunities that may develop in the equity or convertible debt markets. Therefore, the Company believes that stockholder approval of this proposal will provide the Company with a short-term ability to raise important capital without undue expense or delay if the appropriate opportunity arises, on the terms outlined below.

The Company is submitting this proposal, which it refers to as the Private Offering Proposal, to its stockholders for their approval of the potential issuance of shares of the Company’s common stock, or securities convertible into its common stock, in one or more non-public capital-raising transactions, or offerings, subject to the following limitations:

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The aggregate number of shares issued (or issuable) in the offerings will not exceed 110,000,000 shares of the Company’s common stock, subject to adjustment for any reverse stock split effected prior to the offerings (including pursuant to preferred stock, options, warrants, convertible debt or other securities exercisable for or convertible into common stock);

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The total aggregate consideration will not exceed $50 million;

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The maximum discount at which securities will be offered will be equivalent to a discount of 25% below the market price of the Company’s common stock at the time of issuance (as determined based on an aggregate, weighted average of the effective price of the securities sold therein), in recognition that the historical volatility in the price of the common stock makes the pricing discount of the common stock required by investors at any particular time difficult, at this time, to predict;

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Such offerings will occur, if at all, on or before the date that is the three months following the date that the Private Offering Proposal is approved by the Company’s stockholders; and

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Such other terms as the Board of Directors shall deem to be in the best interests of the Company and its stockholders, not inconsistent with the foregoing.

If stockholders approve this proposal, the Company would be permitted to issue securities on the terms and within the timeframe described above without any further authorization from its stockholders for purposes of Nasdaq Listing Rule 5635(d) (and the Company does not expect to solicit further authorization in connection with any such securities issuance, unless otherwise required by applicable law). This proposal would not, however, enable the Company to enter into any transaction that would constitute a change of control under Nasdaq Listing Rule 5635(b) without further authorization from its stockholders.

Effect of Issuance of Securities

The potential issuance of up to 110,000,000 shares of common stock would result in a significant increase in the number of shares of the Company’s common stock outstanding, and, as a result, would likely lead to the Company’s current stockholders owning a smaller percentage of the Company’s outstanding shares of common stock.

While the dilutive effect of the potential issuance cannot be determined, it may be material to the Company’s stockholders. The table below illustrates the potential dilutive impact of such offering based on 68,883,030 shares of common stock issued and outstanding as of November 12, 2024 and assuming various numbers of shares of common stock are issued and sold in such offering.

The information provided in the table above is for illustrative purposes only and actuals results will depend on the timing and terms of any such offering.

Future issuances of securities in one or more non-public offerings could also cause a significant reduction in the percentage interests of the Company’s current stockholders in any liquidation value, the Company’s book and market value, and any future earnings.

Additionally, the issuance of shares of common stock in one or more non-public offerings could have an anti-takeover effect. Such issuance could dilute the voting power of a person seeking control of the Company, thereby deterring or rendering more difficult a merger, tender offer, proxy contest or an extraordinary corporate transaction opposed by the Company.

The Company has not yet determined the specific terms or conditions of any offerings or issuances. As a result, the level of potential dilution cannot be determined at this time but, as discussed above, it may not issue more than 110,000,000 shares of common stock in the aggregate pursuant to the authority requested from stockholders under this proposal (subject to adjustment for any reverse stock split). It is possible that if the Company conducts a non-public stock offering, some of the shares it sells could be purchased by one or more investors who could acquire a large block of the Company’s common stock (either in such offering or upon exercise or conversion of securities purchased therein). This would concentrate voting power in the hands of a few stockholders who could exercise greater influence on the Company’s operations or the outcome of matters put to a vote of stockholders in the future.

The Company cannot determine what the actual net proceeds of the offerings will be until they are completed but, as discussed above, the aggregate dollar amount of the non-public offerings will be no more than $50 million. If all or part of the offerings is completed, the Company expects the net proceeds will be used for general corporate purposes. The Company currently has no arrangements or understandings regarding any specific transaction with investors, so it cannot predict whether it will be successful should it seek to raise capital through any offerings.

OUR BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS THAT OUR STOCKHOLDERS VOTE “FOR” THE APPROVAL OF A POTENTIAL FUTURE PRIVATE OFFERING.

PROPOSAL SEVEN

TO APPROVE OF AMENDMENTS TO OUR AMENDED AND RESTATED CERTIFICATE OF INCORPORATION TO EFFECT A REVERSE STOCK SPLIT

General

Our Board has adopted and is recommending that our stockholders approve amendments to our Amended and Restated Certificate of Incorporation to effect a reverse stock split of our common stock at a ratio ranging from any whole number between 1-for-10 and 1-for-25, with the exact ratio within such range to be determined by the Board in its discretion (the “Reverse Stock Split”), subject to the Board’s authority to determine when to file the amendment and to abandon the other amendments notwithstanding prior stockholder approval of such amendments. Pursuant to the law of the State of Delaware, our state of incorporation, the Board must adopt any amendment to our Amended and Restated Certificate of Incorporation and submit the amendment to stockholders for their approval. The form of the proposed amendments to our Amended and Restated Certificate of Incorporation, one of which would be filed with the Secretary of State of the State of Delaware, are attached to this proxy statement as Appendix C.

By approving this proposal, stockholders will approve alternative amendments to our Amended and Restated Certificate of Incorporation pursuant to which a whole number of outstanding shares of our common stock between 10 and 25, inclusive, would be combined into one share of our common stock. Upon receiving stockholder approval, the Board will have the authority, in its sole discretion, but not the obligation, to elect, without further action on the part of the stockholders, whether to effect the Reverse Stock Split and, if so, to determine the Reverse Stock Split ratio from among the approved range described above and to effect the Reverse Stock Split by filing a Certificate of Amendment with the Secretary of State of the State of Delaware. In this case, all other amendments will be abandoned. The Board may also elect not to effect any Reverse Stock Split. If the Board determines to effect the Reverse Stock Split, it will announce the details of the Reverse Stock Split (including the ratio and timetable for implementation) in accordance with its disclosure obligations.

The Board’s decision as to whether and when to effect the Reverse Stock Split will be based on a number of factors, including market conditions, the historical, then-existing and expected trading price of our common stock, the anticipated impact of the Reverse Stock Split on the trading price of our common stock and on the number of holders of our common stock, and the continued listing requirements of The Nasdaq Global Select Market. Although our stockholders may approve the Reverse Stock Split, we will not effect the Reverse Stock Split if the Board does not deem it to be in the best interests of the Company and its stockholders.

Because the Reverse Stock Split will decrease the number of outstanding shares of our common stock by a ratio in the range of 1-for-10 to 1-for-25 but would not effect a decrease to the number of shares of common stock that the Company will be authorized to issue, the proposed amendments to the Amended and Restated Certificate of Incorporation to effect the Reverse Stock Split (the “Reverse Stock Split amendments”) would result in a relative increase in the number of authorized and unissued shares of our common stock. For more information on the relative increase in the number of authorized shares of our common stock, see “Principal Effects of the Reverse Stock Split-Relative Increase in Number of Authorized Shares of Common Stock for Issuance” below.

Purpose and Background of the Reverse Stock Split

On December 13, 2024, the Board approved the proposed amendments to our Amended and Restated Certificate of Incorporation to effect the Reverse Stock Split for the following reasons:

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the Board believes that implementing the Reverse Stock Split could be an effective means of regaining compliance with the minimum bid price requirement for continued listing of our common stock on The Nasdaq Global Select Market;

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the Board believes that continued listing on The Nasdaq Global Select Market provides overall credibility to an investment in our stock (and CDIs), given the stringent listing and disclosure requirements of The Nasdaq Global Select Market. Notably, some trading firms discourage investors from investing in lower priced stocks that are traded in the over-the-counter market because they are not held to the same stringent standards; and

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the Board believes that a higher stock price (and CDI), which may be achieved through a Reverse Stock Split, could help facilitate the Company’s ability to raise new equity capital either through private fund-raising transactions or by accessing the equity capital markets, generally stimulate investor interest in the Company and help attract, retain, and motivate employees.

Nasdaq Requirements for Continued Listing

Our common stock is quoted on The Nasdaq Global Select Market under the symbol “FEAM.” One of the requirements for continued listing on The Nasdaq Global Select Market pursuant to Nasdaq Listing Rule 5450(a)(1) is maintenance of a minimum closing bid price of $1.00 per share. On December 10, 2024, 2024, the closing market price per share of our common stock was $0.45, as reported by The Nasdaq Global Select Market.

On September 12, 2024, we received a written notification from The Nasdaq Stock Market LLC (“Nasdaq”) notifying us that we had failed to comply with the minimum bid price requirement because the bid price for our common stock over a period of 30 consecutive business days prior to such date had closed below the minimum $1.00 per share requirement (the “Bid Price Requirement”). In accordance with Nasdaq Listing Rule 5810(c)(3)(A), we have been provided an initial period of 180 calendar days, or until March 11, 2025, to regain compliance with the minimum Bid Price Requirement of $1.00 per share. However, if it appears to the Nasdaq staff that the Company will not be able to cure the deficiency, or if the Company is otherwise not eligible, Nasdaq would notify the Company that its securities would be subject to delisting (a “Staff Delisting Determination”). In addition, if the Company has a closing bid price of $0.10 or less for a period of ten consecutive business days, Nasdaq would also issue a Staff Delisting Determination letter. In the event of either such notification, the Company may appeal the Nasdaq staff’s determination to delist its securities. There can be no assurance that the Nasdaq staff would grant the Company’s request for continued listing subsequent to any delisting notification.

If our common stock is delisted from The Nasdaq Global Select Market, we cannot assure you that our common stock would be listed on another national securities exchange, a national quotation service, the over-the-counter markets or the pink sheets. Delisting from The Nasdaq Global Select Market, or even the issuance of a notice of potential delisting, would also result in negative publicity, make it more difficult for us to raise additional capital, adversely affect the market liquidity of our securities, decrease securities analysts’ coverage of us or diminish investor, supplier and employee confidence.

Convertible Notes

The delisting of our common stock from The Nasdaq Global Select Market (if not otherwise listed on the Nasdaq Global Market or The New York Stock Exchange) would constitute a Make-Whole Fundamental Change under the terms of Amended and Restated Note Purchase Agreement. Based on the timing of a Make-Whole Fundamental Change and the trading price of our common stock at such time or the cash received by holders of our common stock in connection therewith, as applicable, the conversion rate of the Convertible Notes will increase by up to 325.2033 additional shares per $1,000 principal amount of August 2022 Notes, up to 346.3996 additional shares per $1,000 principal amount of June 2024 Notes, and up to 444.4445 additional shares per $1,000 principal amount of September 2024 Notes, in each case based on the timing of a Make-Whole Fundamental Change and the trading price of the common stock at such time or the cash received by holders of the common stock in connection with such Make-Whole Fundamental Change, reflecting an aggregate of up to 40,165,615 additional shares of common stock becoming issuable in the event of a Make-Whole Fundamental Change (assuming the Company elects to pay all interest on the Convertible Notes in kind through the delivery of additional Convertible Notes through maturity).

Facilitation of Future Capital Raising

The Board believes it is critically important for the Company to maintain its flexibility in accessing the equity capital markets. As disclosed in the Company’s Annual Report on Form 10-K for the fiscal year ended June 30, 2024 and Quarterly Report on Form 10-Q for the quarter ended September 30, 2024, there is substantial doubt regarding our ability to continue as a going concern.

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, such as a private investment in common stock or preferred equity securities, convertible debt securities or other debt financing, an at-the-market offering of our common stock, rights offering or other public offering of equity or debt securities, and could involve repurchase of the Convertible Notes, amendment of the terms of the Convertible Notes, or exchange of the Convertible Notes for other securities, in each case, as a standalone transaction or as part of a larger financing or restructuring transaction. The availability of additional equity or debt financing will depend on the continued execution of our long-term business plan, our ability to demonstrate a path to long-term profitable growth, as well as market conditions. There can be no assurance that such equity or debt financing will be available in amounts or on terms acceptable to us, if at all, or that we will be able to raise capital to fund our operations and to continue as a going concern.

The sale of additional equity, however, would result in significant dilution to our stockholders. Additionally, the incurrence of debt financing would result in additional debt service obligations and could provide for restrictive operating and financial covenants, security interests on our assets, and other terms that could be adverse to our current stakeholders. Nonetheless, we believe that failure to raise additional capital through equity or debt financing could have a material adverse effect on our ability to meet our short- and long-term liquidity needs and achieve our business objectives.

The Board believes that the Reverse Stock Split would facilitate the Company’s ability to raise additional equity capital in particular, including due to the expected resulting increase in the per share price of our common stock, as described under “Potential Increased Investor Interest” below. The Board believes that an increased price per share of common stock following a Reverse Stock Split would enhance the Company’s ability to raise capital to fund its current, and to otherwise take advantage of favorable opportunities as they arise.

Potential Increased Investor Interest

In addition, in approving the proposed Reverse Stock Split amendments, the Board considered that the Reverse Stock Split and the expected resulting increase in the per share price of our common stock (and CDIs) could encourage increased investor interest in our common stock (and CDIs) and promote greater liquidity for our stockholders (and CDI holders).

In the event that our common stock were to be delisted from The Nasdaq Global Select Market, our common stock would likely trade in the over-the-counter market. If our common stock were to trade on the over-the-counter market, selling our common stock could be more difficult because smaller quantities of shares would likely be bought and sold, and transactions could be delayed, and may also have corresponding impacts on our CDIs. In addition, many brokerage houses and institutional investors have internal policies and practices that prohibit them from investing in low-priced stocks or tend to discourage individual brokers from recommending low-priced stocks to their customers, further limiting the liquidity of our common stock. These factors could result in lower prices and larger spreads in the bid and ask prices for our common stock. Additionally, investors may be dissuaded from purchasing lower priced stocks because the brokerage commissions, as a percentage of the total transaction, tend to be higher for such stocks. Moreover, the analysts at many brokerage firms do not monitor the trading activity or otherwise provide coverage of lower priced stocks. A greater price per share of our common stock (and CDIs) could allow a broader range of institutions to invest in our common stock (and CDIs). For all of these reasons, we believe the Reverse Stock Split could potentially increase marketability, trading volume, and liquidity of our common stock (and CDIs).

Employee Retention

The Board believes that the Company’s employees, consultants and directors who are compensated in the form of our equity-based securities may be less incentivized and invested in the Company if we are no longer listed on Nasdaq. Accordingly, the Board believes that maintaining Nasdaq listing qualifications for our common stock, can help attract, retain, and motivate employees, consultants and members of our Board.

In light of the factors mentioned above, our Board unanimously approved the proposed amendments to our Amended and Restated Certificate of Incorporation to effect the Reverse Stock Split as a potential means of increasing and maintaining the price of our common stock to above $1.00 per share in compliance with Nasdaq requirements.

Board Discretion to Implement the Reverse Stock Split

The Board believes that stockholder approval of a range of ratios (as opposed to a single Reverse Stock Split ratio) is in the best interests of our Company and stockholders because it is not possible to predict market conditions at the time that the Reverse Stock Split would be effected. We believe that a range of Reverse Stock Split ratios provides us with the most flexibility to achieve the desired results of the Reverse Stock Split. The Reverse Stock Split ratio to be selected by our Board will be a whole number in a range of 1-for-10 to 1-for-25. The Board can only authorize the filing of one Reverse Stock Split amendment and all other Reverse Stock Split amendments will be abandoned. The Board also has the authority to abandon all Reverse Stock Split amendments.

In determining the Reverse Stock Split ratio and whether and when to effect the Reverse Stock Split following the receipt of stockholder approval, the Board will consider a number of factors, including, without limitation:

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our ability to maintain the listing of our common stock on The Nasdaq Global Select Market and the applicable ASX Listing Rules;

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the historical trading price and trading volume of our common stock and CDIs;

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the number of shares of our common stock outstanding immediately before and after the Reverse Stock Split;

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the then-prevailing trading price and trading volume of our common stock and CDIs and the anticipated impact of the Reverse Stock Split on the trading price and trading volume of our common stock and CDIs;

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the anticipated impact of a particular ratio on the number of holders of our common stock; and

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prevailing general market conditions.

We believe that granting the Board the authority to set the ratio for the Reverse Stock Split is essential because it allows us to take these factors into consideration and to react to changing market conditions. If our Board chooses to implement the Reverse Stock Split, we will make a public announcement regarding the determination of the Reverse Stock Split ratio.

Risks Associated with the Reverse Stock Split

There are risks associated with the Reverse Stock Split, including that the Reverse Stock Split may not result in a sustained increase in the per share price of our common stock (and CDIs). There is no assurance that:

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the market price per share of our common stock (and CDIs) after the Reverse Stock Split will rise in proportion to the reduction in the number of shares of our common stock (and CDIs) outstanding before the Reverse Stock Split;

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the Reverse Stock Split will facilitate the Company’s access to the equity capital markets;

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the Reverse Stock Split will result in a per share price that will increase the level of investment in our common stock (and CDIs) by institutional investors or increase analyst and broker interest in our Company;

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the Reverse Stock Split will result in a per share price that will increase our ability to attract, retain and motivate employees and other service providers; or

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the market price per share will either exceed or remain in excess of the $1.00 minimum bid price as required by Nasdaq, or that we will otherwise meet the requirements of Nasdaq for continued inclusion for trading on The Nasdaq Global Select Market.

Stockholders should note that the effect of the Reverse Stock Split, if any, upon the market price of our common stock (and CDIs) cannot be accurately predicted. In particular, we cannot assure you that the price for a share of our common stock (and CDIs) after the Reverse Stock Split will increase in proportion to the reduction in the number of shares of our common stock (and CDIs) outstanding immediately prior to the Reverse Stock Split. Furthermore, even if the market price of our common stock (and CDIs) does rise following the Reverse Stock Split, we cannot assure you that the market price of our common stock (and CDIs) immediately after the Reverse Stock Split will be maintained for any period of time. Even if an increased per-share (and per-CDI) price can be maintained, the Reverse Stock Split may not achieve the desired results that have been outlined above. Moreover, because some investors may view the Reverse Stock Split negatively, we cannot assure you that the Reverse Stock Split will not adversely impact the market price of our common stock (and CDIs).

While we aim that the Reverse Stock Split will be sufficient to satisfy the Minimum Bid Requirement, it is possible that, even if the Reverse Stock Split results in a bid price for our common stock that exceeds $1.00 per share, we may not be able to continue to satisfy or regain compliance with Nasdaq’s additional criteria for continued listing of our common stock on The Nasdaq Global Select Market.

We believe that the Reverse Stock Split may result in greater liquidity for our stockholders (and CDI holders). However, it is also possible that such liquidity could be adversely affected by the reduced number of shares (and CDIs) outstanding after the Reverse Stock Split, particularly if the price of our common stock (and CDIs) does not increase as a result of the Reverse Stock Split.

Principal Effects of the Reverse Stock Split

Issued and Outstanding Shares of Common Stock

If the Reverse Stock Split is approved and effected, each holder of our common stock outstanding immediately prior to the effectiveness of the Reverse Stock Split will own a reduced number of shares of our common stock upon effectiveness of the Reverse Stock Split. The Reverse Stock Split will be effected simultaneously for all issued and outstanding shares of common stock and the Reverse Stock Split ratio will be the same for all issued and outstanding shares of common stock. The Reverse Stock Split will affect all of our stockholders uniformly and will not affect any stockholder’s percentage ownership interests in the Company, except to the extent that the Reverse Stock Split results in any of our stockholders owning a fractional share. After the Reverse Stock Split, the shares of our common stock will have the same voting rights and rights to dividends and distributions and will be identical in all other respects to our common stock now authorized. Common stock issued pursuant to the Reverse Stock Split will remain fully paid and non-assessable. The Reverse Stock Split will not affect the Company continuing to be subject to the periodic reporting requirements of the Securities Exchange Act of 1934, as amended (the “Exchange Act”).

The Reverse Stock Split may result in some stockholders owning “odd-lots” of less than 100 shares of our common stock. Brokerage commissions and other costs of transactions in odd-lots are generally higher than the costs of transactions in “round-lots” of even multiples of 100 shares.

Relative Increase in Number of Authorized Shares of Common Stock for Issuance

The Reverse Stock Split will not affect the number of authorized shares or the par value of our capital stock, which will remain at 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 (“Preferred Stock,” and together with our common stock, our “Capital Stock”).

Although the number of authorized shares of our Capital Stock will not change as a result of the Reverse Stock Split, the number of shares of our common stock issued and outstanding will be reduced in proportion to the ratio selected by the Board. Thus, the Reverse Stock Split will effectively increase the number of authorized and unissued shares of our common stock available for future issuance by the amount of the reduction effected by the Reverse Stock Split.

If the proposed Reverse Stock Split amendments are approved, all or any of the authorized and unissued shares of our common stock may be issued in the future for such corporate purposes and such consideration as the Board deems advisable from time to time, without further action by the stockholders of our Company and without first offering such shares to our stockholders. When and if additional shares of our common stock are issued, these new shares would have the same voting and other rights and privileges as the currently issued and outstanding shares of common stock, including the right to cast one vote per share.

Because our stockholders have no preemptive rights to purchase or subscribe for any of our unissued shares of common stock, the future issuance of additional shares of common stock will reduce our current stockholders’ percentage ownership interest in the total outstanding shares of common stock. In the absence of a proportionate increase in our future earnings and book value, an increase in the number of our outstanding shares of common stock would dilute our projected future earnings per share, if any, and book value per share of all our outstanding shares of common stock. If these factors were reflected in the price per share of our common stock, the potential realizable value of a stockholder’s investment could be adversely affected. An issuance of additional shares could therefore have an adverse effect on the potential realizable value of a stockholder’s investment.

Effect on Outstanding Equity Incentive Plans

The Company maintains the 2022 Equity Compensation Plan and the ABR Employee Share Option Plan (together, the “Plans”), which are designed primarily to provide stock-based incentives to employees, consultants and directors of the Company. As of December 10, 2024, options to purchase 2,891,665 shares of our common stock, 382,596 RSUs, 526,868 PSUs and no DSUs were outstanding under the Plans. In the event of a Reverse Stock Split, our Board will adjust the shares remaining available for future issuance, the number of shares subject to or issuable pursuant to outstanding awards and share-based limits under the Plans. Accordingly, if the Reverse Stock Split is approved by our stockholders and our Board decides to implement the Reverse Stock Split, as of the Effective Time (as defined below) the number of shares issuable upon exercise and the exercise price of all outstanding options and any stock price vesting goals per share of any performance-based equity awards under the Plans will be proportionately adjusted (and rounded down to the nearest whole share in the case of shares and up to the nearest whole cent in the case of exercise prices, as applicable) based on the Reverse Stock Split ratio selected by our Board, subject to the terms of such Plans and outstanding equity awards and the requirements of the ASX Listing Rules. Unless required by the terms of the applicable Plan pursuant to which an equity award was issued, no cash payment would be made to holders of equity awards in respect of such rounding. In addition, the number of shares available for future issuance and any share-based award limits under the Plans will be proportionately reduced based on the Reverse Stock Split ratio selected by our Board.

Our Board has also authorized the Company to effect any other changes necessary, desirable or appropriate to give effect to the Reverse Stock Split, including any applicable technical, conforming changes.

Convertible Notes

If approved and effected, the Reverse Stock Split will require that proportionate adjustments be made to the number of shares of Common Stock issuable upon conversion of the Convertible Notes such that the number of shares of Common Stock into which the Convertible Notes are convertible would be proportionally reduced. At the effective time of the Reverse Stock Split, the conversion rate applicable to the Convertible Notes at such time shall be adjusted in accordance with the terms of the Amended and Restated Note Purchase Agreement.

Warrants

We have issued 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 together with the Series A Warrants, the “Warrants”). If the Reverse Stock Split is approved and effected, under the terms of the Warrants, the exercise price will be multiplied by a fraction of which the numerator will be the number of shares of common stock (excluding treasury shares, if any) outstanding immediately before the Reverse Stock Split and of which the denominator will be the number of shares of common stock outstanding immediately after the Reverse Stock Split, and the number of shares issuable upon exercise of any Warrant will be proportionately adjusted such that the aggregate exercise price of the Warrant remains unchanged. The terms of our outstanding Warrants do not permit issuance of fractional shares upon exercise of warrants.

Instead, the Company shall, at its election, either pay a cash adjustment in respect of such final fraction in an amount equal to such fraction multiplied by the exercise price or round up to the next whole share.

Effects of the Amendment on our Common Stock

After the Effective Time, each stockholder will own fewer shares of our common stock as a result of the Reverse Stock Split. Because the Reverse Stock Split will decrease the number of outstanding shares of our common stock, the proposed amendments will result in a relative increase in the number of authorized and unissued shares of our common stock. All outstanding options to purchase shares of our common stock, including any held by our officers and directors, would be adjusted as a result of the Reverse Stock Split. In particular, the number of shares issuable upon the exercise of each instrument would be reduced, and the exercise price per share, if applicable, would be increased, in accordance with the terms of each instrument and based on the ratio of the Reverse Stock Split.

The chart below outlines the capital structure as described in this proposal and prior to and immediately following a possible Reverse Stock Split if the Reverse Stock Split is effected at a ratio of 1-for-10, 1-for-15, 1-for-20, or 1-for-25 based on share information as of the close of business on December 10, 2024, but does not give effect to any other changes, including any issuance of securities after December 10, 2024.

Effect of the Reverse Stock Split on Holders of Outstanding CDIs

The 1:10 share-to-CDI ratio will not be affected by the Reverse Stock Split.

Based on the Reverse Stock Split ratio determined by the Board, the number of issued and outstanding CDIs will be proportionately reduced by the same ratio, subject to rounding.

The table below outlines the impact of a possible Reverse Stock Split on CDIs if the Reverse Stock Split is effected at a ratio of 1-for-10, 1-for-15, 1-for-20, or 1-for-25, based on 337,131,020 CDIs on issue as of the close of business on December 10, 2024, but does not give effect to any other changes. The exact number of CDIs ultimately on issue following a possible reverse split will depend on the treatment of fractional entitlements (see “Fractional Shares” below for further information).

The existing common stock held by CDN on behalf of CDI holders will be replaced with new common stock, and CDI holders will receive CDIs after the Reverse Stock Split in the range of 1-for-10 to 1-for 25. CDI holders will receive a new holding statement or confirmation advice from the Company’s CDI Registry, Computershare Investor Services Pty Limited, for the number of CDIs held following completion of the Reverse Stock Split.

Procedure for Effecting Reverse Stock Split and Exchange of Stock Certificates, if Applicable

If the proposed amendments to our Amended and Restated Certificate of Incorporation are approved by the Company’s stockholders and the Board determines to effect the Reverse Stock Split, the Reverse Stock Split will become effective at 5:00 p.m. Eastern time, on the date the certificate of amendment is filed with the Secretary of State of the State of Delaware (the “Effective Time”). At the Effective Time, shares of common stock issued and outstanding immediately prior thereto will be combined, automatically and without any action on the part of the stockholders, into new shares of common stock in accordance with the Reverse Stock Split ratio contained in the certificate of amendment.

As soon as practicable after the Effective Time, stockholders will be notified by our transfer agent that the Reverse Stock Split has been effected. If you hold shares of common stock in book-entry form, you will not need to take any action to receive post-Reverse Stock Split shares of our common stock. As soon as practicable after the Effective Time, the Company’s transfer agent will send to your registered address a transmittal letter along with a statement of ownership indicating the number of post-Reverse Stock Split shares of common stock you hold. If applicable, a check representing a cash payment in lieu of fractional shares will also be mailed to your registered address as soon as practicable after the Effective Time (see “Fractional Shares” below).

Some stockholders may hold their shares of common stock in certificate form. Our transfer agent will act as exchange agent for purposes of implementing the exchange of stock certificates, if applicable. If you are a stockholder holding pre-Reverse Stock Split shares in certificate form, you will receive a transmittal letter from the Company’s transfer agent as soon as practicable after the Effective Time. The transmittal letter will be accompanied by instructions specifying how you can exchange your certificate or certificates representing the pre-Reverse Stock Split shares of our common stock for a statement of ownership. When you submit your certificate or certificates representing the pre-Reverse Stock Split shares of our common stock, your post-Reverse Stock Split shares of our common stock will be held electronically in book-entry form in the Direct Registration System. This means that, instead of receiving a new stock certificate representing the aggregate number of post-Reverse Stock Split shares you own, you will receive a statement indicating the number of post-Reverse Stock Split shares you own in book-entry form. We will no longer issue physical stock certificates.

STOCKHOLDERS SHOULD NOT DESTROY ANY STOCK CERTIFICATE(S) AND SHOULD NOT SUBMIT ANY CERTIFICATE(S) UNTIL REQUESTED TO DO SO.

Beginning at the Effective Time, each certificate representing pre-Reverse Stock Split shares will be deemed for all corporate purposes to evidence ownership of post-Reverse Stock Split shares.

Fractional Shares

No scrip or fractional shares would be issued if, as a result of the Reverse Stock Split, a stockholder would otherwise become entitled to a fractional share because the number of shares of common stock they hold before the Reverse Stock Split is not evenly divisible by the split ratio ultimately determined by the Board. Instead, each stockholder will be entitled to receive a cash payment in lieu of such fractional share. The cash payment to be paid will be equal to the fraction of a share to which such stockholder would otherwise be entitled multiplied by the closing price per share as reported by The Nasdaq Global Select Market (as adjusted to give effect to the Reverse Stock Split) on the date of the Effective Time. The Company will not assess any transaction costs to stockholders for the cash payment. Stockholders would not be entitled to receive interest for their fractional shares for the period of time between the Effective Time and the date payment is received.

No scrip or fractional shares would be issued if, as a result of the Reverse Stock Split, a CDI holder would otherwise become entitled to a fraction of a CDI because the number of CDIs they hold before the Reverse Stock Split is not evenly divisible by the split ratio ultimately determined by the Board. In these circumstances, either the CDI holder or the Depositary Nominee may be entitled to a cash payment in lieu thereof, subject to applicable legal and regulatory requirements (including the ability to treat the common stock held by CDN on behalf of CDI holders as a single, undivided holding for purposes of making the cash payment in respect of each fractional entitlement). Details of these arrangements will be announced to CDI holders prior to the implementation of the Reverse Stock Split.

After the Reverse Stock Split, then-current stockholders or CDI holders would have no further interest in our Company with respect to their fractional shares or CDIs. A person entitled to only a fractional share would not have any voting, dividend or other rights in respect of their fractional share except to receive the cash payment as described above. Such cash payments would reduce the number of post-Reverse Stock Split stockholders to the extent that there are stockholders holding fewer than that number of pre-Reverse Stock Split shares within the Reverse Stock Split ratio that is determined by the Board as described above. Reducing the number of post-Reverse Stock Split stockholders, however, is not the purpose of this proposal.

Stockholders and CDI holders should be aware that, under the escheat and unclaimed moneys laws of the various jurisdictions where stockholders and CDI holders reside, where we are domiciled and where the funds for fractional shares would be deposited, sums due to stockholders and CDI holders in payment for fractional shares that are not timely claimed after the

Effective Time may be required to be paid to the designated agent for each such jurisdiction. Thereafter, stockholders and CDI holders otherwise entitled to receive such funds may have to seek to obtain them directly from the state or agency to which they were paid.

No Appraisal Rights

Under the Delaware General Corporation Law, the Company’s stockholders will not be entitled to appraisal rights with respect to the Reverse Stock Split, and we do not intend to independently provide stockholders with any such right.

No Going Private Transaction

Notwithstanding the decrease in the number of outstanding shares following the Reverse Stock Split, the Board does not intend for this transaction to be the first step in a series of plans or proposals of a “going private transaction” within the meaning of Rule 13e-3 of the Exchange Act.

Interests of Certain Persons in the Proposal

Certain of our officers and directors have an interest in this Proposal Seven as a result of their ownership of shares of our common stock, as set forth in the section entitled “Security Ownership of Certain Beneficial Owners and Management” above. However, we do not believe that our officers or directors have interests in Proposal Seven that are different from or greater than those of any of our other stockholders.

Anti-takeover Effects of Proposed Amendments

Release No. 34-15230 of the staff of the SEC requires disclosure and discussion of the effects of any action, including the proposed amendments to our Amended and Restated Certificate of Incorporation discussed herein, that may be used as an anti-takeover mechanism. An additional effect of the Reverse Stock Split would be to increase the relative amount of authorized but unissued shares of our common stock, which may, under certain circumstances, be construed as having an anti-takeover effect. Although not intended for such purposes, the effect of the increased available shares could be to render more difficult or discourage an attempt to take over or otherwise obtain control of the Company (for example, by permitting issuances that would dilute the stock ownership of a person or entity seeking to effect a change in the composition of the Board or contemplating a tender offer or other change in control transaction). In addition, our Amended and Restated Certificate of Incorporation and our Bylaws include provisions that may have an anti-takeover effect. These provisions, among things, permit the Board to issue preferred stock with rights senior to those of the common stock without any further vote or action by the stockholders and do not provide for cumulative voting rights, which could make it more difficult for stockholders to effect certain corporate actions and may delay or discourage a change in control.

Our Board is not presently aware of any attempt to acquire control of the Company, and the Reverse Stock Split proposal is not part of any plan by our Board to recommend or implement a series of anti-takeover measures.

Accounting Treatment of the Reverse Stock Split

If the Reverse Stock Split is effected, the par value per share of our common stock will remain unchanged at $0.01. Accordingly, at the Effective Time, the stated capital on the Company’s consolidated balance sheets attributable to our common stock will be reduced in proportion to the size of the Reverse Stock Split ratio, and the additional paid-in-capital account will be increased by the amount by which the stated capital is reduced. Our stockholders’ equity, in the aggregate, will remain unchanged as a result of the Reverse Stock Split. Per share net income or loss will be increased because there will be fewer shares of common stock outstanding. The Company does not anticipate that any other accounting consequences, including changes to the amount of stock-based compensation expense to be recognized in any period, will arise as a result of the Reverse Stock Split.

Certain Material U.S. Federal Income Tax Consequences of the Reverse Stock Split

The following discussion is a summary of certain material U.S. federal income tax consequences of the Reverse Stock Split to U.S. Holders (as defined below) of our common stock. This summary is based upon the provisions of the U.S. Internal Revenue Code of 1986, as amended (the “Code”), Treasury regulations promulgated thereunder, administrative rulings and judicial decisions, all as in effect as of the date hereof, and all of which are subject to change and differing interpretations, possibly with retroactive effect. Changes in these authorities or their interpretation may result in the U.S. federal income tax consequences of the Reverse Stock Split differing substantially from the consequences summarized below. We have not sought, and will not seek, an opinion of counsel or a ruling from the Internal Revenue Service, or the IRS, regarding the U.S. federal income tax consequences of the Reverse Stock Split, and there can be no assurance that the IRS will not challenge the statements and conclusions set forth below or that a court would not sustain any such challenge.

This summary is for general information purposes only and does not address all aspects of U.S. federal income taxation that may be relevant to stockholders in light of their particular circumstances or to stockholders that may be subject to special tax rules, including, without limitation: (i) persons subject to any alternative minimum tax; (ii) banks, insurance companies, or other financial institutions; (iii) tax-exempt organizations; (iv) dealers in securities or commodities; (v) regulated investment companies or real estate investment trusts; (vi) partnerships (including entities or arrangements treated as partnerships for U.S. federal income tax purposes and their partners or members); (vii) traders in securities that elect to use the mark-to-market method of accounting; (viii) persons whose “functional currency” is not the U.S. dollar; (ix) persons holding our common stock in a hedging transaction, “straddle,” “conversion transaction” or other risk reduction transaction; (x) persons who acquired our common stock in connection with employment or the performance of services; (xi) retirement plans; (xii) persons who are not U.S. Holders (as defined below); or (xiii) certain former citizens or long-term residents of the United States. This summary also assumes that the U.S. Holder holds the pre-Reverse Stock Split common stock, and will hold the post-Reverse Stock Split common stock, as a “capital asset” as defined in Section 1221 of the Code (generally, property held for investment). All stockholders are urged to consult their own tax advisors with respect to the U.S. federal income tax consequences, as well as any state, local or non-U.S. tax consequences, of the Reverse Stock Split.

In addition, this summary of certain U.S. federal income tax consequences does not address the tax consequences arising under the laws of any foreign, state or local jurisdiction or any U.S. federal tax consequences other than U.S. federal income taxation (such as U.S. federal estate and gift tax consequences). If a partnership (including any entity or arrangement treated as a partnership for U.S. federal income tax purposes) holds shares of our common stock, the tax treatment of a partner in the partnership generally will depend upon the status of the partner, the activities of the partnership, and certain determinations made at the partner level. Partnerships holding our common stock and the partners in such partnerships should consult their tax advisors regarding the tax consequences to them of the Reverse Stock Split.

EACH U.S. HOLDER SHOULD CONSULT ITS TAX ADVISORS WITH RESPECT TO THE PARTICULAR TAX CONSEQUENCES OF THE REVERSE STOCK SPLIT TO SUCH U.S. HOLDER.

This summary addresses only stockholders that are U.S. Holders. For purposes of this discussion, a “U.S. Holder” is any beneficial owner of our common stock that, for U.S. federal income tax purposes, is or is treated as any of the following:

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an individual who is a citizen or resident of the United States;

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a corporation created or organized under the laws of the United States, any state thereof or the District of Columbia;

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an estate, the income of which is subject to U.S. federal income tax regardless of its source; or

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a trust that (i) is subject to the primary supervision of a U.S. court and all substantial decisions of which are subject to the control of one or more “United States persons” (within the meaning of Section 7701(a)(30) of the Code) or (ii) has a valid election in effect to be treated as a United States person for U.S. federal income tax purposes.

The Reverse Stock Split is intended to qualify as a “reorganization” under Section 368 of the Code that constitutes a “recapitalization” for U.S. federal income tax purposes. Assuming the Reverse Stock Split qualifies as a reorganization, a U.S. Holder generally is not expected to recognize gain or loss upon the exchange of pre-Reverse Stock Split shares of our common stock for post-Reverse Stock Split shares of our common stock, except with respect to cash received in lieu of fractional shares of our common stock, as discussed below. The aggregate tax basis of the post-Reverse Stock Split common stock should be the same as the aggregate tax basis of the pre-Reverse Split Stock common stock exchanges in the Reverse Stock Split (excluding any portion of such basis that is allocated to any fractional share of common stock). A U.S. Holder’s holding period in the post-Reverse Stock Split common stock should include the period during which the U.S. Holder held the pre-Reverse Stock Split common stock exchanged in the Reverse Stock Split. Treasury regulations promulgated under the Code provide detailed rules for allocating the tax basis and holding period of shares of common stock surrendered pursuant to the Reverse Stock Split to shares of common stock received pursuant to the Reverse Stock Split. U.S. Holders holding shares of common stock that were acquired on different dates and at different prices should consult their tax advisors regarding the allocation of the tax basis and holding period of such shares.

A U.S. Holder that receives cash in lieu of a fractional share of common stock pursuant to the Reverse Stock Split is expected to be treated as first receiving such fractional share and then receiving cash in redemption of such fractional share. A U.S. Holder that receives cash in lieu of a fractional share in the Reverse Stock Split is expected to recognize capital gain or loss equal to the difference between the amount of the cash received in lieu of the fractional share and the portion of the U.S. Holder’s adjusted tax basis allocable to the fractional share. Any such capital gain or loss should be long-term capital gain or loss if the U.S. Holder’s holding period in the fractional share of common stock surrendered is longer than one year as of the effective date of the Reverse Stock Split. U.S. Holders should consult their tax advisors regarding the tax effects to them of receiving cash in lieu of fractional shares based on their particular circumstances.

A U.S. Holder may be subject to information reporting and backup withholding on cash paid in lieu of fractional shares in connection with the Reverse Stock Split. A U.S. Holder will be subject to backup withholding if such U.S. Holder is not otherwise exemption and such U.S. Holder does not provide a correct taxpayer identification number and other required information (such as by submitting a properly completed IRS Form W-9) or otherwise fails to comply with the applicable backup withholding tax rules. Backup withholding is not an additional tax. Any amount withheld under the backup withholding rules may be refunded or credited against a U.S. Holder’s U.S. federal income tax liability; provided that the required information is properly furnished in a timely manner to the Internal Revenue Service.

The tax treatment of a U.S. Holder may vary depending upon the particular facts and circumstances of such U.S. Holder. Each U.S. Holder is urged to consult their own tax advisor with respect to the tax consequences of the Reverse Stock Split.

Material Australian Income Tax Consequences of the Reverse Stock Split

The summary of the material Australian tax implications of the Reverse Stock Split in this section are general in nature and should not be relied upon as advice. The tax implications for each stockholder or CDI holder will depend on the circumstances of the particular stockholder or CDI holder (as applicable). Accordingly, all Australian resident individual stockholders and CDI holders (as applicable) are encouraged to seek their own professional advice in relation to their tax position. Neither the Company nor any of its officers, employees or advisors assumes any liability or responsibility for advising stockholders and CDI holders about the Australian tax consequences for them of the Reverse Stock Split.

Subject only to rounding, there would be no change to the proportionate interests held by each stockholder or CDI holder as a result of the Reverse Stock Split. For Stockholders and CDI holders who are not Australian residents and who hold common stock or CDIs on capital account, no Australian capital gains tax (“CGT”) liability will arise, as non-resident securityholders are generally only subject to CGT on Australian real property.

For Australian stockholders and CDI holders who hold a number of shares of common stock (or CDIs) that is evenly divisible by the split ratio determined by the Board for the Reverse Stock Split (that is, who would not be entitled to a cash payment in lieu of the receipt of a fractional share), no capital gains tax event occurs as a result of the Reverse Stock Split, and the cost base and reduced cost base of the common stock and CDIs following the Reverse Stock Split will need to be determined by reference to their original securityholding. The date of acquisition of the securities will remain the same for the Australian stockholders and CDI holders.

For Australian stockholders and CDI holders who do not hold a number of shares of common stock (or CDIs) that is evenly divisible by the split ratio determined by the Board for the Reverse Stock Split (that is, who would be entitled to a cash payment in lieu of the receipt of a fractional share), CGT consequences may arise in respect of that cash payment and the disposal of the securityholding that it relates to, being the shares of common stock or CDIs that are not evenly divisible by the split ratio. There should be no CGT consequences in respect of the securityholdings that are evenly divisible by the split ratio determined by the Board for the Reverse Stock Split, and the cost base and reduced cost base of the common stock and CDIs following the Reverse Stock Split will need to be determined by reference to the securityholdings to which the Reverse Stock Split applied and for which new common stock or CDIs were issued.

OUR BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS THAT OUR STOCKHOLDERS VOTE “FOR” THE APPROVAL OF AMENDMENTS TO OUR AMENDED AND RESTATED CERTIFICATE OF INCORPORATION TO EFFECT A REVERSE STOCK SPLIT.

PROPOSAL EIGHT

TO APPROVE THE ADJOURNMENT OF THE ANNUAL MEETING, IF NECESSARY, TO SOLICIT ADDITIONAL PROXIES IF THERE ARE NOT SUFFICIENT VOTES IN FAVOR OF PROPOSALS THREE, FOUR, FIVE, SIX OR SEVEN

The Board believes that, if the Annual Meeting is convened and a quorum is present, but there are not sufficient votes to approve Proposals Three, Four, Five, Six or Seven, it is in the best interests of the Company and its stockholders to enable the Company to continue to seek to obtain a sufficient number of additional votes to approve Proposals Three, Four, Five, Six or Seven, as applicable.

The Company is requesting that our stockholders authorize the holder of any proxy solicited by our Board to vote in favor of granting discretionary authority to the proxy holders, and each of them individually, to adjourn the Annual Meeting to another time and place, if necessary, to solicit additional proxies in the event there are not sufficient votes to approve Proposals Three, Four, Five, Six or Seven. If our stockholders approve this proposal, we could adjourn the Annual Meeting, and any adjourned or postponed session of the Annual Meeting, to use the additional time to solicit additional proxies, including the solicitation of proxies from our stockholders that have previously voted.

OUR BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS THAT OUR STOCKHOLDERS VOTE “FOR” THE APPROVAL OF THE ADJOURNMENT OF THE ANNUAL MEETING, IF NECESSARY, TO SOLICIT ADDITIONAL PROXIES IF THERE ARE NOT SUFFICIENT VOTES IN FAVOR OF PROPOSALS THREE, FOUR, FIVE, SIX OR SEVEN.

Your vote is important. Please promptly vote your shares by completing, signing, dating and returning your proxy card or by Internet or telephone voting as described on your proxy card or CDI voting instructions.