Ann: Appointment of Receivers and Managers, page-285

The trouble with this notion that one of these other Lithium ' Parties ' are going to just accept and take up the debt amount as the accepted status quo is fanciful in my opinion .....unless the deal has the backing from AJM's entire offtake partners who will loose their equity Investment in AJM only to then have to stump up again in another Lithium Player. And how ridiculous does that even sound.

And the reason I say this is that if you go all the way back to to 2016 , you will see from AJM's Balance Sheet that they had only $526,000 in capitalized Property , Plant and Equipment. At that time they had promoted in their Annual Report that the estimated costs of the S1 project were some $140 million ( including sustaining capital ) , and a payback of only 1.8 years.

Then in 2017 they moved to 850,000 in capitalized Property , Plant and Equipment and $59.353 million in mine development costs project costs .....all off the back of only $15.627 of vendor loans. ( ie Buckler ) and of course equity in shareholders funds.

Fast forward to now ....or at least at the half yearly accounts as at December 31, 2019 , and you have 286.257 million in Property , Plant and Equipment. and Mining Properties off the back of $190.113 million in loans and countless equity raising's of at least another $50 - $70 million in just keeping the operations going.

So here we are now with perhaps just over $250 million with at least $50 -$60 million being represented by Capitalized Interest Costs. So in my mind based on these clear ' Overruns ' on the cost base of these assets , there is a minimum of $100 million to be discounted off the value of these overvalued assets. Even if PLS or GXY see it as a way of fast tracking their own planned S2 or S3 via savings of their own planned expenditure - the bottom line is that they are still overvalued as to what the replacement costs would be using their own equity and lower financing costs.

So whether the Note holders will accept a $100 million plus haircut is yet to be seen - and why would they when they could have just lowered the lending costs to AJM. So there is more to what's going on here in the obvious breakdown in confidence and trust in Management's abilities in my opinion.