Ann: Deferral of Fin Rep Obligations/Ext of Time to Hold 2020 AGM, page-65

In your hypothetical I believe FIRB would be extremely interested in any Chinese company owing large outstanding sums to an Australian company and then using those funds to become a cornerstone equity investor. Particularly in an industry so critical to the Chinese State's long term plans at a time when key Australian imports are being slapped with questionable tariffs with apparent political motivation.

In your hypothetical would the Ganfeng debt to AJM be wiped, or would they take a $70m equity position and still owe whatever your "tally" is on difference between what they paid for shipments and the contractual floor since the prepayment cleared at the end of last year?

Am also curious about your thoughts as to why AJM trumpeted letters of credit for shipments receoved upon loading at Pt Hedland in the 2020 quarterly announcements but never mentioned they were only partial payments. How do you rationalise that?

I actually think it would be constructive for those trying to understand what went wrong with AJM to have a conversation about how different independent spodumene producers responded when pricing headed to US$450dmt CIF China and in the end to the high US$300s.

The reason your opinion matters is because this is the court of public opinion on hotcopper and for months readers have been urged to dismiss any information from those not considered "genuine holders".

I provided many sources of published market pricing - even highlighting the asian metals price graph contained in the ShanShan offtake document - , reported pricing from competiors, current 2020 Aus Gov industry reports while debating those cherry picking figures from 2019 versions, analysis of the cashflow reports, correspondence from the AJM managing director confirming the cashflow statements were correct in that the floor hadn't held, general details of the AJM payment mechanism....

Yet every few weeks arguments would resurface claiming in various ways that AJM was an exception or AJM SC6 market pricing is different to all other SC6 market pricing.

Still it is apparent for a proper debrief and analysis of the default it will take a "genuine holder" to meet in the middle and accept the mountain of evidence.

Can then even explore some of your concerns about AJM competitors you have been very vocal about.

We could also discuss why AJM chose to sell below floor, and it isn't quite as simple as pressure from financiers to move product, or cashflow issues that ruled out heavy moderation.

There was also a relevant example with A40 where their sole offtaker did honour a rather high contractual floor, until they themselves went broke. I imagine this played a role in AJMs decision making, particularly with the more marginal customers.

Now Ganfeng may have indeed had the financial capacity to pay the floor, but seems they were intent on playing AJM off against PLS and in turn driving down pricing that could be used to influence published market pricing to determine pricing at Mt Marion. I would also add there is no evidence to suggest Ganfeng did not pay on time in line with standard industry practice.

Other offtakers were certainly doing it much tougher and were themselves trying to stay afloat... as such it wasn't in AJMs interests to see them go under for the long term and also cause problems with the noteholders by the resulting hole in the AJM offtaker slate.

After all, the rationale for shareholders to accept the ShanShan offtake deal despite it being independently deemed unfair by PWC essentially relied upon the demands of financiers for fully committed product.

Are we at the point yet where emotions have tempered and a civil discussion can take place on what would make a great case study on so many levels?

You know my history well enough by now, and despite - as you are aware - I took a position in PLS after they refinanced, I am more than happy to discuss the past and current struggles and ongoing areas of risk at that company, including relations with offtakers that were tied to AJM.

Will also provide my thoughts on the difficult, but not insurmountable path available for James Brown and associates to put together an acceptable and successful binding proposal to either save AJM or pick up ALO with a new vehicle, clear of entanglements and free to negotiate new offtake agreements with greater leverage in negotiations.

While I endeavour to offer opinion based on heavily researched and often verified fact, I am always cognizant that it is near impossible to remove all bias but offer you an open invitation to have a real debrief whether here on HC or if you prefer, confidentially via my contact methods listed in my signature.

I'm far from perfect but if I can help in some way, the offer is there.