Ann: Quarterly Activities Report - June 2024, page-23

The level of gaslighting by this company is extreme, and it's even more shocking that some people are still lapping it up. Here are my thoughts:

1. Development at Rincon has ceased, and any semblance of progress with Tonopah was abandoned long ago. Pre-development engineering for the 10 ktpa expansion has now been outsourced, but it has no chance of being funded anyway, so it seems like a futile and expensive time-wasting exercise. Deal-making for the expansion has also been outsourced to an international investment bank, again with no hope of execution. Staff in Perth and Salta are now essentially idle, while more money is wasted on outsourcing tasks for an expansion that won't happen. At this point AGY is just slowly circling the drain, trying to distract remaining loyal shareholders with false hope, while failing to present any feasible path forward.

2. The narrative used to be that AGY didn't need a feasibility study because they would prove feasibility by successfully executing the preliminary stages of the project. They didn't, and now they have two clear examples of failure. Despite this, AGY expects to attract funding for Stage 3 without commissioning Stages 1 or 2, producing a bankable feasibility study, or updating cost projections for the past six years. It's absurd to think a deal can be negotiated now when the company's situation and the macroeconomic environment have significantly worsened.

3. The current plan seems to be just sit and wait. An external contractor is working on the 10 ktpa expansion plans despite any hope of funding it, but what's everyone else doing in the meantime? People will be sitting idle. After the expansion engineering is complete, more waiting will ensue. The company’s only hope is a complete turnaround in the lithium market in the short term, or a miraculous funding agreement for Stage 3, despite failing to secure a deal in a much better market previously.

4. Cash on hand is around $12 million after spending nearly $5.2 million last quarter. I anticipate it will take time to reduce costs with progressive staff demobilisation, leave and redundancy payouts, and preparing equipment for care and maintenance. I expect another ~$4 million will be burned this quarter, reducing the balance to around $8 million by the end of Q3. Consequently, I foresee another cap raise in either Q4 2024 or Q1 2025.

5. AGY seems to be rationing positive news. It's baffling why they withheld the sale price from the recent shipment, only to disclose it in the quarterly after damaging the stock price with the C&M announcement. Their communication skills remain incompetent despite everything.

Overall, the quarterly report held no surprises since they had already ripped the band-aid off with the C&M announcement. Personally, I find it crazy that people still have hope here, but to each their own I suppose.