Ann: Response to Pilbara Minerals Announcement,PLS-MIN.AX, page-104

I have been thinking about this and as Ozblue suggested a binding MOU is a bit of a misnomer. But I think that it might make more sense than it immediately seems.

I totally agree with you JJ on the fact that the crux of the BOA is for us to supply GLC with 140kt of Spodumene per year, as a standard sales agreement. People seem to be missing that. That 140kt at this point has nothing to do with a downstream plant that PLS is involved in. That Spodumene is GLC's to do with as they please.

The BOA could however bind the terms of the MOU. Things like:
- what the share of capex for the plant will be
- what the share of opex would be
- are we supplying spod for the plant at FBR costs or market price
- are GLC paying half the FBR costs
- are we paying half the conversion costs and so on

This however still does not make either party obliged to act on any of this. There is nothing further than an understanding to assess the viability of a downstream JV. I am just saying with my non-lawyer knowledge (so read with some speculation) that maybe the BOA binds the terms of the MOU.

What does this mean. If MIN want to match this deal all they will be obliged to agree to under the BOA is the purchase of our Spodumene. However if they actually were interested in participating in a conversion JV with us perhaps, and I really do mean perhaps, they would be bound to the same terms as the MOU.

At it's simplest form though the BOA is a sales agreement based on the pricing formula. If this has really been provided to MIN an expert determination should be as easy as asking MIN do they want the 140kt under that pricing method or don't they.

In addition to this given the suggestion that the next BOA is said to be on a similar pricing structure I don't see this as being a continual drama. If they decide they want to pay it the first time, they will continue to pay it until they have secured the amount of spod they want. If they don't want to pay it the first time, why would they want to pay it the second, or the third time?