Form 4: Encompass Capital Restructures T1 Energy Stake

Encompass Capital Advisors and related entities restructured their holdings in T1 Energy Inc., converting Series A Preferred Stock and acquiring new Series B and B-1 Preferred Stock along with additional common shares.

Summary

• Reporting Persons (Encompass Capital Advisors LLC, Todd J. Kantor, Encompass Capital Partners LLC) are directors and 10% owners of T1 Energy Inc.
• On October 31, 2025, an Amended and Restated Stock Purchase Agreement (SPA) was executed, amending a previous agreement from November 6, 2024.
• This SPA led to the redemption and cancellation of all 5,000,000 shares of Series A Convertible Preferred Stock.
• In exchange for the Series A Preferred Stock, the purchasers received 21,504,901 shares of T1 Energy's common stock and 1,600,000 shares of Series B Convertible Non-Voting Preferred Stock.
• Additionally, the purchasers bought 5,000,000 shares of Series B-1 Convertible Non-Voting Preferred Stock at $10.00 per share.
• Following these transactions, the Reporting Persons beneficially own 34,968,169 shares of Common Stock.
• They also beneficially own 1,600,000 shares of Series B Preferred Stock and 5,000,000 shares of Series B-1 Preferred Stock.
• Each share of Preferred Stock is convertible into Common Stock at an initial conversion price of $1.70, subject to a 19.99% beneficial ownership cap.

Sentiment

Score: 7

Explanation: The restructuring and new investment indicate continued commitment from a significant investor, which is generally positive, though the details are complex and involve a mix of equity types.

Positives

• Reporting Persons increased their direct common stock holdings by 21,504,901 shares.
• The acquisition of new Series B and B-1 Preferred Stock indicates continued investment and confidence in T1 Energy Inc.
• The conversion feature of the Preferred Stock provides potential for significant future common stock ownership, up to 19.99% of outstanding shares.

Negatives

• The redemption and cancellation of Series A Convertible Preferred Stock means previous terms associated with that class are no longer in effect.
• A 19.99% beneficial ownership cap on conversion of Preferred Stock limits the immediate full conversion potential for the holders.

Risks

• Reporting Persons disclaim beneficial ownership of securities owned directly by other members of the Section 13(d) group, which could lead to complexities in determining total group ownership.
• Reporting Persons disclaim beneficial ownership of the reported Common Stock except to the extent of their pecuniary interest, which might complicate full beneficial ownership assessment for investors.

Future Outlook

The Series B and B-1 Convertible Preferred Stock are convertible into common stock at any time, indicating a future potential increase in common stock holdings for the Reporting Persons, subject to the 19.99% beneficial ownership cap.

Management Comments

• For purposes of Section 16 of the Securities Exchange Act of 1934, as amended, the Reporting Persons may each be deemed to be a director by deputization of the Issuer.
• Each of the Reporting Persons disclaims beneficial ownership of the securities of the Issuer owned directly by other members of the Section 13(d) group and this report shall not be deemed an admission that the Reporting Persons are the beneficial owners of such securities for purposes of Section 16 or for any other purpose.
• Further, each of the Reporting Persons disclaims beneficial ownership of the shares of Common Stock reported herein except to the extent of his or its pecuniary interest therein.

Industry Context

This transaction reflects a significant restructuring of a major investor's stake in T1 Energy Inc., a common occurrence in the energy sector as companies and investors adapt to market conditions or strategic shifts.

Related Party Transactions

• The transaction involves T1 Energy Inc. and its directors/10% owners (Encompass Capital Advisors LLC, Todd J. Kantor, Encompass Capital Partners LLC), qualifying it as a related party transaction.

Stakeholder Impact

• Shareholders: The issuance of 21,504,901 common shares and the potential future conversion of preferred stock could dilute existing common shareholders, but also signals strong investor commitment. The purchase of preferred stock at $10.00 per share provides capital to the company.
• Company (T1 Energy Inc.): Receives capital from the sale of Series B-1 Preferred Stock and restructures its preferred equity, potentially improving its capital structure and liquidity.

Next Steps

• Potential future conversion of Series B and B-1 Preferred Stock into Common Stock by the Reporting Persons, subject to the 19.99% beneficial ownership cap.

Key Dates

Recommendation

This Form 4 details a significant restructuring of a major investor's stake, involving both common stock and new preferred convertible shares, and a capital infusion. While the continued investment is positive, the complexity of the preferred stock conversion terms and the potential for future dilution warrant a 'hold' as investors assess the long-term implications of this capital structure change on T1 Energy's valuation and future performance.

Keywords

T1 Energy, TE, Encompass Capital, Form 4, beneficial ownership, preferred stock, common stock, equity investment, insider transaction