Ann: Project and Funding Update, page-86

**Positives in the Report:**
1. **Project Timeline:** - Kathleen Valley Lithium Project remains on-track for first production in the middle of this calendar year. - Positive: Management's commitment to project delivery within the set timeline.
2. **Cash Position:** - Liontown has approximately $515 million cash at bank at 31 December 2023. - Positive: Strong cash position provides a buffer and financial flexibility.
3. **Construction Funding:** - The $300 million project funding package secured from Ford is fully drawn and expected to fund construction activities for first production in mid-2024. - Positive: Secured funding helps in progressing construction activities.
4. **Investor Support:** - Lenders within the syndicate remain highly supportive of the Project despite adjustments to the debt facility. - Positive: Indicates continued confidence from financial partners.
5. **Long-term Outlook:** - Management expresses confidence in the long-term outlook of the lithium market and Kathleen Valley’s status as a Tier 1 long-life producer. - Positive: Focus on the project's strategic importance and its potential in the lithium market.
**Management Actions:**
1. **Project Review:** - Initiated a comprehensive Project Review to address the impact of reduced lithium prices. - Management is examining options, including deferring underground development, adjusting mine plans, and optimizing costs. - Proactive steps: Demonstrates management's adaptability to changing market conditions.
2. **Revised Debt Facility Discussions:** - Engaging in discussions for a revised, smaller debt facility reflecting the Project Review. - Proactive steps: Indicates responsiveness to market challenges and a commitment to securing appropriate funding.
3. **Transparent Communication:** - Scheduling an investor and media teleconference to provide updates on the situation. - Proactive steps: Transparent communication to address investor concerns and provide insights into the company's strategies.
4. **Cash Management:** - Utilizing the secured funding effectively to progress construction activities. - Positive cash management: Demonstrates prudent financial stewardship amid market uncertainties.
5. **Future Funding Update:** - The Company expects to provide a funding update by the end of the March 2024 quarter. - Forward-looking approach: Signals the intention to keep stakeholders informed about financial developments.In summary, while facing challenges, Liontown Resources' management is proactively reviewing and adjusting plans, engaging with stakeholders, and maintaining a strong cash position to navigate the current market conditions.