ENERGY FUELS INC

Current report

The risk factors set forth in (i) Item 1A of the Company’s Quarterly Report on Form 10-Q for the three and six months ended June 30, 2026 and (ii) Item 8.01 under the caption “RISK FACTORS” in the Company’s Current Report on Form 8-K filed on October 13, 2026, are incorporated herein by reference as if fully set forth in this Item 1A.

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ITEM 1A. RISK FACTORS.

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Risks relating to the Conditional Financing Commitment

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There can be no assurances that all conditions to the Conditional OSC Financing will be satisfied, that the proposed financing will be completed or that the proposed financing will not be modified, challenged or impaired in the future, each of which could have a material adverse effect on our business, results of operations and financial position.

Previous report

The Conditional OSC Financing is subject to further due diligence, finalization of agreements, closing conditions and approvals.

Previous report

There can be no assurances that all conditions will be satisfied and that the proposed financing will be completed, and that funding of and support for the transactions contemplated by the financing commitment will not be modified, challenged or impaired in the future, which could have a material adverse effect on our business, results of operations and financial position.

Previous report

In the event of any termination or frustration of the Conditional OSC Financing, in full or in part, we may have limited recourse and remedies available against the OSC and the U.S. federal government.

Previous report

Energy Fuels’ business is subject to change in U.S. policy, regulation and funding could impair the Company’s ability to operate its existing business and pursue its strategic plans.

Previous report

Our operations are subject to extensive regulatory requirements enforced in part by the U.S. federal government. If government regulations are interpreted or enforced in a manner adverse to us, we may be subject to enforcement actions, penalties, exclusion, and other material limitations on our operations. Any changes in U.S. federal regulations or a failure to comply with the terms of the agreements with the U.S. federal government could impair our ability to operate our existing business and pursue our strategic plans. Furthermore, the potential opportunities afforded Energy Fuels by participating in a government financing program like that of the OSC are unique. While this financing is expected to enhance Energy Fuels’ ability to pursue its strategic goals, including sourcing of heavy rare earth feedstock and securing necessary environmental permits and approvals, Energy Fuels remains solely responsible for meeting all commercial and regulatory requirements.

Previous report

The Conditional OSC Financing also subjects us to various laws, regulations, and other policies and considerations that may constrain our future business or otherwise have a material adverse impact on our future financial results. We may be subject to heightened scrutiny of our business activities with both government and non-government customers, government audits, investigations, congressional scrutiny, inquiries about conflicts of interest, civil or criminal enforcement by the Department of Justice (including actions under the False Claims Act), exclusion or limitation on future government-funded opportunities, suspension, debarment, and other administrative remedies.

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The Conditional OSC Financing contains affirmative and negative covenants that may impair our ability to operate in the normal course of business, which could have a material adverse effect on its business.

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The Conditional OSC Financing specifies additional steps that we must take to proceed toward financial close on the loan, including fulfilling financial, legal, technical and other due diligence requirements. Additionally, the Conditional OSC Financing contains affirmative and negative covenants that could impair our ability to operate in the normal course of business. If strategic transactions that we wish to undertake are prohibited by the Conditional OSC Financing, our ability to operate in the ordinary course of business could be materially impacted. It is noted that the Conditional OSC Financing expressly contemplates the ASM transaction and transactions such as the VAC Merger. However, both transactions remain subject to OSC due diligence which could impact the availability or timing of the proposed financing.

Previous report

Additionally, the Conditional OSC Financing contemplates a potential for warrants to be issued. The amount or terms of such warrants have not yet been determined. If warrants are issued and are exercised, the issuance of the Common Shares underlying such warrants will dilute the ownership interests of holders of Common Shares and reduce the value of their investment.

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Risks of entering into the Merger Agreement and VAC Merger

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The market price of the Common Shares may be adversely affected as a result of the VAC Merger consideration and related financing arrangements.

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The VAC Merger Consideration consists of: (i) $718 million (being the VAC Merger Cash Consideration); (ii) 65,853,000 Common Shares (subject to the maximum number of Common Shares constituting the VAC Merger Share Consideration that may be issued without obtaining the approval of our shareholders under applicable Canadian securities laws; and (iii) VAC Merger Preferred Share Consideration, issued, as set out in the Merger Agreement, to replace Common Shares removed from the VAC Merger Share Consideration to comply with Canadian Securities Laws (with the number of Preferred shares increased in accordance with the Merger Agreement if the VAC Merger Share Consideration is so reduced) and/or to provide an additional value top up if the market price of the Common Shares at closing is below a specified reference price.

Previous report

The increase in the number of issued and outstanding Common Shares may lead to sales of such shares or perception that such sales may occur, either of which may adversely affect the market for, and the market price of, Common Shares. Further, the issuance of the VAC Merger Share Consideration may dilute the ownership interests of holders of Common Shares and reduce the value of their investment. Similar dilution could result from the sale of assets to meet liquidity requirements.

Previous report

In addition, we currently anticipate using some or all of the proceeds of the Senior Secured Term Loan Facility, together with cash on hand, to fund the VAC Merger Cash Consideration. Under the terms of the Senior Secured Term Loan Facility, amounts to be funded will be reduced by the net cash proceeds from the issuance or incurrence of certain debt, the issuance of equity financing (including equity and debt securities convertible or exchangeable into or exercisable for equity securities, other equity-linked securities or hybrid debt-equity securities) and non-ordinary course asset sales. To the extent that we issue equity securities or equity-linked securities, or incur additional debt, to reduce or repay amounts drawn under the Senior Secured Term Loan Facility, such issuances could further dilute the ownership interests of holders of Common Shares and/or increase our leverage and debt-servicing obligations, post-closing of the ASM and VAC transactions. Additional debt may also impose further covenants and restrictions on our operations.

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If the VAC Merger Preferred Share Consideration is issued, holders of our preferred shares will have certain preferential rights over holders of Common Shares.

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If the VAC Merger Preferred Share Consideration is issued at closing, such holders will have preferred rights to our assets upon liquidation, the right to receive dividends before dividends would be declared to holders of Common Shares, and the right to the redemption of such preferred shares, possibly together with a premium, prior to the redemption of Common Shares.

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Closing Conditions to the VAC Merger may not be satisfied.

Previous report

Implementation of the Merger Agreement is subject to the satisfaction or waiver (where permitted) of a number of closing conditions. There can be no guarantee that the closing conditions will be satisfied or waived (where permitted), or, if satisfied or waived (where permitted), when that will occur. Certain closing conditions are beyond our control and VAC’s control, including regulatory approvals. Any failure or delay in satisfying the closing conditions could prevent or delay the implementation of the Merger Agreement, which could reduce the benefits that we and VAC expect to obtain from the VAC Merger, increase the costs associated with the VAC Merger and/or impede the successful integration of our and VAC’s businesses.

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The Merger Agreement may be terminated in certain circumstances.

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We and VAC have the right to terminate the Merger Agreement in circumstances pursuant to Section 9.01 of the Merger Agreement. As such, there is no certainty that the Merger Agreement will not be terminated by either VAC or us before the VAC Merger is completed.

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In this scenario, the market price of Common Shares may fall and there is no assurance that any alternative proposal will emerge (and if such proposal emerges, there is no assurance that it will be at an equivalent or lower price than the implied price to be paid to acquire VAC under the Merger Agreement).

Previous report

Significant transaction and transaction-related costs have been incurred and will continue to be incurred.

Previous report

Both VAC and us have incurred, and will continue to incur, significant costs associated with the Merger Agreement and combining our businesses with those of VAC. Fees and expenses related to the VAC Merger include financial adviser fees, filing fees, taxes, legal, accountant and regulatory fees. Some of these costs will be paid regardless of whether the VAC Merger is completed.

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Changes in the risk and investment profile of our Common Shares.

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The closing of the VAC Merger will alter the risk exposure of our shareholders, as they will be exposed to risks relating to each of our business, ASM, and VAC (the “Combined Company”) (including the integration of VAC).

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Integration and failure to realize benefits, including synergies.

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On and from the closing, we expect to pursue and realize benefits of increasing operations across magnets and manufacturing with REE.

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There is a risk that we may not achieve the strategies, operational objectives and benefits (in whole or in part) or that they will not materialize or will not materialize to the extent that we contemplate, or they will be delayed. This may occur due to matters beyond our control, or as a result of changes in circumstances or strategies. A failure to achieve these strategies, operational objectives and benefits could have an adverse impact on our operations, financial performance and financial position. There is also a risk that the Combined Company will not benefit (in whole or in part) from the synergies and other benefits.

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We may face new tax risks in certain VAC operating jurisdictions.

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VAC has operations and conducts business in Germany, Slovakia, Malaysia, Finland, and other parts of the world, in which our subsidiaries do not currently operate or conduct business in. Taxation laws in these jurisdictions can be complex, subject to varying interpretations and applications by relevant tax authority and are continuously subject to changes and revisions. In addition, following the VAC Merger, we may be subject to tax liabilities that may exist at VAC or that may arise in connection with the VAC Merger which are currently unknown. Any unexpected taxes imposed on us could have a material and adverse impact on our financial position.

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VAC has not been subject to internal control infrastructure requirements that U.S. public companies are required to comply with.

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VAC was not required to maintain an internal control infrastructure that would meet the standards of a U.S. public company, including the requirements of the Sarbanes-Oxley Act of 2002, as amended. The costs to implement such controls and procedures may be substantial and we could encounter unexpected delays and challenges in this implementation.

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In addition, we may discover significant deficiencies or material weaknesses in VAC’s financial and disclosure controls and procedures which could result in additional costs or adversely affect our business or operating results, and, as has occurred with us, the accounting for acquisitions can be complex and may lead to material weaknesses.

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Risks relating to the Combined Company’s business and operations

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The Combined Company’s business and industry will be subject to a number of business and operation risks, including risks that are outside of its control, which could negatively impact the Combined Company’s actual results. These risks include, but are not limited to, those set out below:

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a. Risks related to the jurisdictions in which the Combined Company will operate.

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The Combined Company and its businesses, and the industries in which it operates, are subject to a number of risks related to the jurisdictions in which the Combined Company operates, including risks that are outside of its control, which could negatively impact on the Combined Company’s actual operation and financial results.