The Government has promised the assistance on the condition that ACL's directors give personal guarantees.

But ACL's directors yesterday confirmed they were only willing to put their share of the business as a guarantee.

The situation has again placed the future of more than 270 workers at the Rocherlea-based company in jeopardy.

ACL chairman Ivan James wrote to Treasurer Michael Aird over the weekend to say that he was not prepared to become bankrupt if the company was to default on the loan, offered at 9.2 per cent.

"Whilst I am prepared to lose all I have invested over my lifetime in ACL, I am not prepared to risk becoming bankrupt," Mr James said.

"Also, I am not prepared to cause my wife to lose her interest in our family home.

"No fair-minded Australian would do that to their partner if they have any choice in the matter, yet these things could happen in the future if I provide an unlimited personal guarantee."

Mr James said he and his co- directors would be willing to guarantee the loan to the extent of their shares, held in separate companies - Synella Pty Ltd (owned by Ivan James), Trivanton Pty Ltd (owned by Mike Saward) and Eneston Pty Ltd (owned by John Capuano).

"In the event of default, this would provide the Government with 44.02 per cent of the shares in ACL, three seats on the board, and the right of veto over all major transactions," Mr James said.

ACL needs to repay a $3 million debt to lenders GE Finance by June 30 and it has been unable to find another private lender.

It also owes about $3 million to key industry players, understood to include Holden and Ford.

The company has received a $4 million grant from the Federal Government but cannot use that money to repay debt - it is instead to be used for capital investment and equipment upgrades.

Mr James said the situation was urgent.

"Under our funding agreements with the Commonwealth and our loan agreement with (industry lender), we are required to give three business days notice to them if we intend to appoint administrators," Mr James said.

"Therefore, by 5pm on Wednesday, June 24, 2009 we need a binding commitment from the Tasmanian Government that it will complete the proposed loan agreement and advance $4 million dollars to ACL on June 30, 2009.

"Otherwise, we cannot avoid insolvency."