Ahh you crack me up sometimes Cat ... What do yiou reckon ......

Ahh you crack me up sometimes Cat ... What do yiou reckon ... Keith has sharp claws, James the big paws and Brett the limp wrist?





In all seriousness, like I've said to another poster who doubts my integrity, I'm not in the habit of posting private email dialogues. The one from James was done to purposefully put into context some nasty social media commentary circulating here. I have a few questions for KP that I want to talk to ... and hopefully they get addressed in their Q1 earnings call.

Some things are simple and others are not (like the context of the shareholder agreement between SYA and PLL that's governs certain SYQ decision making at BoD level where a special resolution majority is required).

Anyway back to the OTA ... ever heard of performance obligations in an agreement (excluding force majeure). Nothings ever black and white. They are the "promises" that one party makes to the other ... e.g. price is based on SC6 based on DAP Cherryville ... now PLL i not getting SC and it's not being delivered to Cherryville either (at the expense of SYQ) ... adjustments are made so that the performance obligation can be met (which in this case is tonnage but at a lower grade delivered elsewhere ... but we don't know the price exactly ...but does it really matter to us (HC posters) ... it only matters to the partners).

So I have to believe this OTA isn't that different to most ... SYQ partners (the sellers) would first determine an allocation schedule withs its buyers (of which PLL is also a party ... the only party that is a contracted buyer presently) and if their needs change then they would try and accomodate it. But in the end its a contract and their is dependency on cash flows. That "entitlement" (or claim) on 113,000 tons does not disappear (IMO) if PLL suddenly decides it doesn't "need" it. For simplicity if SC6 was $1,000/t all year then SYQ is entitled to receive $113M in exchange for the "Title" on the ore processed into 113,000 tons SC6. Then penalty for "deferral" (should it be assessed) would be commensurate to the financial loss ... and it wouldn't be something like if they took 10% less they pay 10% ($11.3M) ... it might be they pay 10% interest for the 3 months (because they have a year for example) .... so 10% of $11.3M x 25% (1 Qtr of a year) ... ~$300K ... that is a WAG on my part ... just trying to make an illustrative example.

It is a JV ... and SYA holders seem to what to stick it to PLL ... like the outcry when BL first said the first 113Kt goes to PLL. Now there is outcry that PLL isn't taking the first 113Kt because prices are low now and they are likely to recover later in the year. Seems like SYA posters want it both ways???