NOVONIX Secures Up to US$100M in Convertible Debentures from Yorkville

Funding Agreement Details

NOVONIX Limited (ASX – NVX) has formalized a significant funding agreement with Yorkville Advisors Global, LP, enabling the issuance of up to US$100 million in unsecured convertible debentures. The funding will be provided in multiple tranches, with an initial US$24.5 million tranche already issued and drawn down without the need for shareholder approval. Subsequent tranches totaling US$75.5 million require shareholder approval at an Extraordinary General Meeting (EGM) expected around September 9, 2025.

This structured approach balances immediate capital needs with governance safeguards, allowing NOVONIX to access substantial funding while managing shareholder dilution and oversight.

Strategic Use of Proceeds

The proceeds from this funding will primarily support the ongoing build-out of NOVONIX's Riverside facility in Chattanooga, Tennessee, which is poised to begin shipping commercial-grade synthetic graphite later this year. Mass production is slated for next year, targeting key customers such as Panasonic. This facility represents a critical step in establishing a domestic supply chain for synthetic graphite, a vital component in lithium-ion batteries.

Additionally, the funding will provide financial flexibility for general corporate purposes and the planned second mass production site at Enterprise South, further solidifying NOVONIX's footprint in North America’s battery materials sector.

Convertible Debentures and Shareholder Impact

The convertible debentures issued to Yorkville carry a 5% annual interest rate and are convertible into fully paid ordinary shares of NOVONIX. The conversion price is carefully structured with a floor price and a fixed conversion price to mitigate excessive dilution risk for existing shareholders. The first tranche conversion is capped to align with NOVONIX's current placement capacity, while later tranches require shareholder approval to issue additional shares.

This mechanism provides Yorkville with conversion flexibility while protecting shareholder interests, reflecting a balanced capital structure enhancement.

Market and Sector Context

NOVONIX's ability to secure this institutional investment, advised exclusively by Goldman Sachs & Co. LLC, underscores growing investor confidence in the battery materials sector and the strategic importance of domestic supply chains for critical minerals in North America. The company's focus on synthetic graphite production positions it uniquely to capitalize on the expanding electric vehicle and energy storage markets.

As the first large-scale synthetic graphite producer dedicated to the battery sector in North America, NOVONIX is well placed to leverage this funding to accelerate growth and innovation.

Looking Ahead

While the initial tranche provides immediate capital, the realization of the full US$95 million funding depends on shareholder approval and mutual agreement with Yorkville for subsequent drawdowns. The company must also meet certain trading and market conditions to access later tranches, adding layers of conditionality to the funding timeline.

Nonetheless, this funding agreement marks a pivotal milestone in NOVONIX’s journey toward commercial-scale production and market leadership in battery materials.