Pulse Markets Webinar - Justyn Peters, page-33

To Danharks. Sorry, mate, I hope you get this. The HC will not let me tick the reply button. You must belong to a protected species.

Thank you, Danharks, for your comments. In response to your comments, I will start will start by restating the basis on which my argument stands - Ann, 5B, two executive interviews, and the analysist's report commissioned and promoted by LCK.

Cash (potentially) at 30 June 2021 estimated as $5.5 million + ($12.0 million i.e. tranches 2&3) = $17.5 million.
Expenditure for Quarters 3&4 estimated
- $25 million to prove Stage I to be completed by end of 2021 Report and interview).
- $6.0 million on signing HoA (Report).
- $5.0 million corporate costs.

Total expenditure for Quarters 3&4 - $36.0 million.

(Cash available at 30June 2021- expenditure for Q3&4) = ($17.5 - $36.0) = -$18.5 million.

A shortfall of $18.5 million. ( a full Q)

To maintain the current program there will have to be an injection of funds, probably some time in Q4.

How?. Loan, CR, share placement etc ?

"Firstly: Insolvency by Q3 w/o CR."
Danharks, You are proposing a Plan B. Mate, there is no Plan B. Having said that, I have no argument with your proposal for an alternative plan. What you say, I think is very reasonable. But you must remember that the boss has said in essence that they are fast tracking, and I have said previously, fast tracking, if successful, is great, but if it fails it does so spectacularly.

As you intimate, we could plod along for 7 Quarters, but how would the market react to this.

"Secondly: Stage 2 LCEP scoping costs."
Not relevant, $6.0 million is payable on signing HoA (Report)

"Thirdly:" your suggestion in the previous post vis-a-vis regarding setup for CR.
Please don't attempt to verbal me here, even by inference. This sort of red herring sorely tests the nerve endings of my delicate sensibilities. On the basis that I did not explain my terse statement fully, here goes.

The market sets the share price trend, not a few blokes who might think they can move mountains. On my expectation that LCK will need extra
funding, and if the market has depressed the share price, we have been set up for cheap extra funding via a share placement, a loan or a CR. My understanding is that the timing of the $6 million tranche releases is completely under control of the "Investors". I am not sure how the market would react to high share price capital raising. I cast no aspersions whatever, on the honesty and good faith of the board.

"Fourth:"
Here again, you are promoting a Plan B and pushing back the project, however, I do not necessarily disagree with you.

On "your" take of things:
Fair enough, you have great confidence in the board, but they, too, do have their challenges,

I would just like to add a view on DLEC's interest. This project is a mega project, and engineering companies do not have a shelf full of them to pick from. They have to win this contract, and the fact that they want to be involved in the financing activities tells me that they are serious.

Except for "I wasn't surprised at all by the extension, just need to sit tight and see how it plays out." , I will ignore the last paragraph, there is not much to comment on.. A well thought out post, fairly rare on this forum. I look forward to more discussions. J L.