Ann: Potential Partnership With CEZ & Significant Investment, page-20

• So as a result of this deal EMH has a stake of 49% in Geomet which is the Cinovec project holder, we know the economics
• A 100% subsidiary of CEV (SDAS) will own 51% and CEV is 70% owned by the state. So the state effectively has 35.7% ownership of Cinovec, that is not nationalization and not indifferent to many mines and oil & gas developments worldwide. I wrote a long time ago about the possibility of a PSC type arrangement that is common in the oil and gas industry.

So to look at pros and cons......

• this will prevent mass dilution of EMH shares to raise cash
• this should eliminate any issues with mining permits etc
• Geomet's majority shareholder has access to project finance and markets
• EMH still has 49% of a significant project as a stakeholder/ investor and project partner
• significantly de-risked (sovereign and financial)

• EMH loses majority control and has 2 of 5 decision makers on the board
• DFS is 18 months away

and 2 extracts from the announcement that are extremely relevent.....................

..............that Cinovec is a robust project with strong economics, the funding of large mining and processing
projects requiring significant capital expenditure is very challenging for smaller mining companies in
current economic and market conditions.

The addition of a partner with the financial strength of CEZ, and the strong significant business
relationships that it brings, significantly enhances the attractiveness of the Cinovec Project at this
important stage of its development.

If you look at PLS (2.2 Billion shares on issue and down from around a dollar to 30c this year) and GXY (409M shares on issue and down from over 2.50 to 1.00 this year) the market is unforgiving.

So in conclusion some shareholders are not happy with losing ultimate control but there may not be any better alternatives. EMH shareholders have 49% of one of the most significant lithium projects in Europe. Who cares if the CR government has 35.7%? I see this as more positive than negative - check out government investment in projects in China, India, Norway, Brazil etc etc.. Sales / offtake agreements may follow and further enhance the economics.

So work out what the project is worth and take 49% ownership.