#United States #Convertible Notes #Lakewood #Energy Fuels #Rare Earths

Energy Fuels Plans $550 Million Convertible Notes Offering

Energy Fuels Inc. (NYSE: UUUU | TSX: EFR), known as a significant player in the U.S. uranium and rare earth elements sector, has recently disclosed its intention to offer $550 million in convertible senior notes set to mature in 2031. This announcement aligns with the company's strategy of enhancing its capital structure and supporting various ongoing projects.

Details of the Offering

This offering will be conducted as a private placement targeting qualified institutional buyers in accordance with Rule 144A of the Securities Act of 1933. Additionally, the company has revealed plans to grant initial purchasers of these notes the option to acquire an extra $82.5 million during a specified period following the issuance.

The convertible notes will represent unsecured obligations of Energy Fuels, accruing interest that is payable semiannually. Importantly, these notes can be converted by holders into a mix of cash and common shares of the company, based on terms to be finalized when the offering pricing is determined.

Purpose of Proceeds

Energy Fuels has indicated that proceeds from this strategy will mainly be allocated towards several essential focuses:
1. Capped Call Transactions: Funds will first cover capped call transactions detailed further in their plans.
2. Project Financing: The capital will be directed towards crucial developments, especially the planned expansion of their rare earth separations circuit at the White Mesa Mill.
3. Developing Global Projects: It also includes financing development and earn-in expenditures for their Donald heavy mineral sands and rare earth project in Australia.
4. General Corporate Needs: The remaining funds will assist the company's operational needs and overall working capital requirements.

In the context of these transactions, Energy Fuels is expected to engage with select financial institutions, referred to as “option counterparties,” through privately negotiated capped call transactions. These operations are designed to mitigate the potential dilution of shares when the notes are eventually converted and offer flexibility in corporate financing options.

Market Impact and Considerations

The issuance and negotiation activities surrounding these notes could markedly affect the market price of Energy Fuels' common shares. By entering into various derivative transactions, the option counterparties may actively manage their hedge positions, influencing stock prices above or below the conversion threshold.

Moreover, the notes and the shares that may be issued upon their conversion will remain unregistered under the Securities Act. Hence, they cannot be offered or sold in the United States without registration or an applicable exemption. Notably, there will be no offerings made in Canada.

Forward-Looking Statements

It's essential for stakeholders to recognize that the news is embedded with forward-looking statements, projecting various aspects of the offering's structure, completion timeline, and anticipated impacts on both company and market performance. While such statements reflect current expectations, they bear inherent uncertainties that could lead to discrepancies in actual outcomes.

Energy Fuels emphasizes its commitment to transparency, urging investors to consider its formal SEC filings for comprehensive risk assessments.

About Energy Fuels

Operating from Lakewood, Colorado, Energy Fuels is an industry leader in the extraction of critical minerals, focusing primarily on uranium and rare earth elements. The company holds a pivotal role in producing & processing uranium for nuclear utilities and is recognized for its innovative approach to bringing high-purity rare earth products to market. With strategic international projects and an expanding resource base, Energy Fuels continues to position itself for significant future growth.