I don't agree that Dingyi are choking ELM into a corner. Not yet...

I don't agree that Dingyi are choking ELM into a corner. Not yet at least but the board needs to be at a heightened state of alertness from now on.

I worked out that even if Elm were to exercise the remaining $5 million convertible note in conjunction with Pala and Stalker they would control 25% of the company.

I think it is a prudent time to really cut all costs where possible. Get rid of the fat cats, no more funding on feasibility, shut down the TSX listing, cut staff and possibly shut down either the Australian or South African offices. Further exploration on Dougou is a good idea as favourable results will put upward pressure on the share price which is what we want and not what Dingyi want. We should go back in time and turn ourselves back into a tight, lean exploration company and reduce waste as much as possible as this will mean we can last longer without having to raise more funds and give us more time to see Dingyi's next move before deciding on whether to exercise the remaining $5 million convertible note.

It may be wise to not exercise the final $5 million convertible note imo but again that will depend on how Dingyi is behaving at that time.

Also, there are good signs that the potash market has bottomed so the longer we can last with the $10 million the better. Source: Click here

If there are signs that Dingyi are slowly choking us and by that I mean say offer more convertible notes whilst procrastinating on a genuine takeover offer or even by making an offensively cheap offer, then I have confidence that the board could easily make a placement to a select group of investors to ensure that Dingyi's % ownership is kept down.

I don't believe that Dingyi deliberately knew that this reverse takeover would get knocked back hence give them the chance to get control cheaper but the market has changed since then and they may start playing dirtier so our board has to treat them with extreme caution from now on.