auditors unable to sign off, page-9

Hi all,
I hold a large position in ADY & if ADY does get forced under due to non repayment of this Hawkswood loan I'm going to end up in the divorce court. Besides this I have 3 of my brothers plus several friends invested in ADY as well so I'd say I'm going to have to pay them back as well (after I sell our house) so I have a lot at stake here.

Back in August I sent an email asking ADY 'do they have the funds to pay Hawkswood the $10M due in September'? Maria replied back on 21 Aug with an email (which is cut & pasted below) & statements in this email are the reason I stayed fully invested through all the last month but now wondering if we've all been blatantly misled with the comment of 'paying the loan back before it was due' plus the part about the imminent release of the Lithium tender document 'being typed up right now'!

Read it & other holders tell me your thoughts. Will they claim negotiations just fell apart...? I forwarded their reply back to them 2 weeks ago asking if they had any update on this & never got an answer back.

Dear Ms,

As detailed in the latest Admiralty Update, we have sufficient iron ore stockpiled and spot contract sales for September to cover the amount owing just from the profit. However our very hardworking and astute Managing Director, Mr Thomas, has a floating rate loan planned for drawdown in early September (the money is due on 30 September 2008) for about US$25m, and as mentioned in the press release he also has progressed significantly on the five year sales contract and US$40m loan from Shougang to be provided by Santander. It appears he has rapidly progressed negotiations with Shandong iron and Steel and this will “substitute” for Shougang or complement them. Either way there is a further $80m in the pipeline.

There is another $35-$50m coming from the 10 year pre-sales contract for the lithium and he has been negotiating intensely prior to the release of the tender document which is being typed up now.

Mr Thomas will also be able to defer the payment to the liquidator very easily as there are a number of issues he is in dispute with but I suspect it will be paid before it is due and no doubt he will be asking for a healthy discount.

Kind regards,

Maria Vazquez
Investor Relations

Admiralty Resources NL
Level 14, 200 Queen Street
Melbourne VIC 3001
P: +61 3 9642 8787
F: +61 3 8677 6949
E: [email protected]
W: www.ady.com.au