Questions the company didn't want to answer in the conference call

I am a long term investor in Galaxy. I have been in and out of the company since Iggy days, but have been a committed investor for about the last 4 years. I believe there will inevitably be a transition away from fossil fuels and that lithium will play an important role in the new energy future. I have educated myself a lot over the years about Li sector and the main players. Galaxy Resources stood out as one of the shining lights in the sector due to the three assets under its control. Sal de Vida in particular is a stand out world class brine deposit which should have seen the company evolve into a tier one lithium producer. And then there is James Bay waiting in the wings. I have said before on this forum that my expectation was that Galaxy's share price would one day reach $10. That was my target. I realise now that this is not going to happen under the management that we currently have in place. It seems a takeover is the best we can hope for under present management and I am beginning to feel that this may have always been what the BOD was hoping for.

Over the past few years it has become more and more apparent to me that Galaxy management are treating this company as their own private company. They seem to have a very cosy relationship with institutional "investors" while at the same time adopting a contemptuous attitude towards small (retal) investors. (N.B. I use the term "investors" loosely when it comes to some of the institutions the company is cosy with because success for them often comes just as easily through a company failing as it does when a company is successful).

I have a lot of questions I would like to ask the company. I also wanted to ask the questions in a public forum, so that everybody gets to hear the answers. You would think that the Quarterly Activities Conference Call would be the opportune time to ask these questions. The ASX announcement put out by the company does afterall state that this is an investor conference call. And I am an investor. I'm not so sure some of our institutional friends are.

Anyway, I had questions that I wanted to ask at the previous conference call. However the call was ended so quickly after the last analyst had got answers to his questions that I missed out. I was determined that I would not miss out again this time around. It was suggested to me by one of my colleagues that it would be courteous to let the company know that I wanted to ask questions. Therefore I sent the following email to Simon Hay the day prior to the conference call:

Hi Simon,

I wish to ask some questions at the end of the conference call tomorrow. My questions relate to:

1. What action the Board may take to protect the share price.

2. Why communications with shareholders are still poor.

3. What due diligence was taken with respect to Alita and is there any chance of getting any of that $40m back.

4. Why the company doesn't seek to correct some of the misinformation put out by analysts.

5. The remuneration paid to the Chairman and to Anthony Tse. (which is very high compared even to Top 50 companies)

6. Why the supposedly long term contracts are able / allowed to be broken by the Chinese customers.

Last conference call I held back from asking my questions until after the analysts had finished with their questions. However the call was terminated very quickly. This time, I would appreciate it if the conference call is not ended so quickly, so that Retail investors like myself have time to press the *1 button and get their questions in.

Kind regards,

I received an email back that night from the company's Investor Relations and Corporate Affairs Manager saying she would be more than happy to call me back the next day to address my questions. She suggested this might be at a time which was after the conference call. I didn't respond because I wanted my questions answered during the call, so everybody would have the opportunity to hear the answers to what I believe are some pretty important and relevant questions. I would have been happy to then subsequently discuss things at a personal level with someone from the company.

I duly called in to open briefing the next day and provided my name and other details. I told the person who took my details that I had questions I wanted to ask. Two minutes into the conference call, I received an email from Daniel Harangozo, the company's Manager Corporate Development advising me the call is reserved for analysts questions only, and that he would be happy to catch up and take my questions later. I emailed back him and told him I had already advised the conference call people that I had questions to ask. I asked him who says the conference call is for analysts only.

When the time for questions came, I registered the fact that I had questions immediately (even before Nick Herbert got to ask his questions). I sat back and waited as the three or four usual analysts got to ask their questions with the expectation that my turn would come. I couldn't believe it when the operator said that was the end of the questions and ended the call. I emailed Daniel back and told him: The company announcement about the conference call says it is an Investor Conference Call, not an analyst call. I told him I was f*ing pissed you guys for not taking my questions.

This inability for shareholders to ask questions in a public forum (other than the AGM) is a real problem. It seems the system is rigged against the small shareholder, particularly when you also consider the indifference of the ASX and ASIC when you wish to bring something to their attention.

I have no intention for now of contacting anybody in the company for the simple reason that I believe everyone should be entitled to hear the answers to my questions.

I spent a fair bit of time preparing my questions. In fact I had prepared a bit of a script because part of asking a question is to provide some context. As I have already said, I think they are worthwhile questions. So here are the questions I wanted to ask (complete with prologue) and hopefully somebody else might be able to get the answers:

Question 1

I’d like to ask aquestion about the share price and the high level of shorting activity againstthe company.

In the space of 3years Galaxy has gone from best stock on the ASX to the most heavily shorted,with our share price falling 80% and I don’t believe that is all due to bearishsentiment with the Li sector. A lot has to dowith promises not being kept, guidance not being met and poor communications bythe company. We also understandthat there has been manipulation by institutional banks occurring, some ofwhich are taking part in this earnings call and all of which the company seemsto enjoy close relationships with.

My question is - Why has the Board not initiated some kindof action to protect the share price?

Before you answer, I’dlike to point to the example set by Kingscote Consolidated. They announced a share buyback, and the mere threat was enough to get the shorters to back off. The share price rose 40% without a single share having to be brought back.

Question 2

Contracts

We supposedly hadthese long term contracts at set rates with Chinese off-takers. It seems however that these can be broken by the customer whenever they please, and the company just has to wear it.

Can you comment please –and perhaps also could you tell us who are these customers anyway (why thesecrecy?)

Question3

A40

What a disappointment.

I don't feelcomfortable about how that investment has been handled from start to finish.

What was therationale to spend $40m on that company?

What kind of due diligence was done?

How could theBOD have been so ignorant regarding the state of the mine and the LOM?

Is the companyproposing to get involved in the court actions relating to the take-over bythat Cayman Island registered entity? Is it considering action against Mark Calderwood?

Is there anychance of getting any of that $40m back?

Question 4

This questionrelates to communications. It gets raised at every call. And we keep getting told you hear us and that communications are going to improve. I think it was the last call – we were told you were appointing a communications person.

However communications arestill poor:

· Having beentold that the ponds were going to be lined and filling commenced before Xmas, whyaren’t we told about why this has been delayed? (A bit like the Xmas before when we were all waiting to hear the SdV joint venture announcement, but only got told it wasn’t going to happen some 3 months later – despite the fact the institutions certainly knew it wasn’t going to happen).

· Whydon’t you tell us about shipping, including when guidance is not going to bemet?

· Whydoes the company refuse to give us the list of Top 20 shareholders when we askfor it?

· Why doour emails go unanswered?

· Whywhen we call and the receptionist takes our details and promises someone will callus back, do we not get that return call?

· Who atthe company is responsible for communications / investor relations?

Question5

Given the history of Argentina's unstable economy &government (including military rule), can you tell me if the company has a political sovereign-risk insurance policyin place?

Question6

Remuneration

Galaxy is not a Top100 company and yet the fees paid to its Chairman and non-executive directorsfar exceeds the fees paid to Chairman and Directors of Top 100 companies.

The Executive Chairof Northern Star Resources gets remunerated $1.4m cf. GXY’s Chairman getting$1m. Market cap of Northern Star is $9.16B and its share price goes from strength to strength year on end. Market cap of GXY is less than $0.5B and it is poorly performing.

My question – howis the remuneration paid to GXY’s Chairman and to AT justified when compared tothat paid to the Chairs and directors of more successful companies.

Question7

Misinformation

I have concernsregarding misinformation that is put into the market about the company byanalysts. Some of whom their institution is represented on this call.

This misinformationappears to be targeted and deliberate in order to generate a negative impact onthe share price. Some examples are:

· UBSsaying the company will not be profitable until 2023.

· Macquarierecently valuing the company in AUS dollars rather than US, and listing SdV ashaving zero value.

I appreciate thecompany can't jump on every misleading statement. But in an effort to protectthe interest of its shareholders and the company reputation I would havethought it is one of the responsibilities of the Board- and would like tounderstand why the company does not call out some of this incorrect analysis toprotect our investment?

Perhaps the companyshould be doing this as part of better communications.