American Battery Technology Co (NASDAQ:ABAT), a company specializing in nonmetallic mineral mining, has revealed the filing of a prospectus supplement related to an At-The-Market (ATM) offering, as per a recent 8-K filing with the Securities and Exchange Commission. The company, headquartered in Reno, Nevada, may intermittently sell common stock shares totaling up to $50 million through the sales agreement with Virtu Americas LLC.
The ATM sales agreement, initially disclosed on April 3, 2024, allows American Battery Technology to issue shares of its common stock with a par value of $0.001 each. The offering is subject to the terms set forth in the Sales Agreement and will be conducted through Virtu Americas LLC, acting as the sales agent.
The prospectus supplement filed today pertains to the company's registration statement on Form S-3 (File No. 333-276329) and is part of the process enabling the offer and sale of the shares. The details of the sales agreement are referenced in the full text of the agreement, which was attached as Exhibit 10.1 to the company's Form 8-K filed on April 3, 2024.
Additionally, the legal opinion regarding the issuance of the shares provided by Holland & Hart LLP, the company's legal counsel, has been filed with the SEC as Exhibit 5.1 and is incorporated by reference.
In other recent news, American Battery Technology Company (ABTC) has been awarded a $150 million grant by the U.S. Department of Energy to support the construction of its second commercial-scale lithium-ion battery recycling facility. The new facility is expected to process about 100,000 tonnes of battery materials annually.
Additionally, ABTC has successfully produced lithium hydroxide using proprietary technologies and plans to construct a refinery capable of producing 30,000 tons of lithium hydroxide annually, backed by a $57.5 million U.S. Department of Energy grant.
The company has also secured a binding purchase agreement for its recycled black mass material with a domestic customer. Personnel changes include the appointment of Steven Wu as Chief Operating Officer, succeeding Andrés Meza, and the appointment of Scott Smith, a former Tesla (NASDAQ:TSLA) executive, as Vice President of Financial Planning and Analysis. Furthermore, ABTC has secured an additional $40.5 million in tax credits for the development of a new commercial battery recycling facility in the United States.
InvestingPro Insights
American Battery Technology's recent filing for an ATM offering of up to $50 million comes at a critical time for the company, as revealed by InvestingPro data. With a market capitalization of $57.44 million, ABAT is currently operating in a challenging financial environment. The company's revenue for the last twelve months stands at a modest $0.34 million, while it reported a significant operating loss of $37.52 million for the same period.
Two key InvestingPro Tips shed light on ABAT's current situation. Firstly, the company is "quickly burning through cash," which aligns with the decision to pursue this ATM offering as a means to raise capital. Secondly, ABAT "suffers from weak gross profit margins," evidenced by the stark -862.07% gross profit margin reported. These factors underscore the company's need for additional funding to support its operations and growth initiatives in the competitive nonmetallic mineral mining sector.
Despite these challenges, it's worth noting that analysts anticipate sales growth in the current year, according to another InvestingPro Tip. This potential growth prospect may be a driving factor behind the company's decision to secure additional funding through the ATM offering.
Investors considering ABAT should be aware that InvestingPro offers 12 additional tips for this stock, providing a more comprehensive analysis of the company's financial health and market position.
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