Lake Resources NL Annual Report 2021

Plain-text annual report

ANNUAL REPORT lakeresources.com.au CORPORATE DIRECTORYfor the year ended 30 June 2021DirectorsStuart Crow -Non-executive ChairmanSteve Promnitz -Managing Directorand CEODr. Nicholas Lindsay -Executive Technical DirectorDr. Robert Trzebski –Non-executive Director Amalia Saenz -Non-executive Director (Appointed 28July2021)CompanySecretary-JointPeter Neilsen(Appointed 27July 2021).Garry Gill Registered office and Principal Place of BusinessLevel 5,126 Phillip Street,Sydney, NSW 2000,AustraliaTel: +61 2 9299 9690Share RegisterAutomic Registry Level 5,126 Phillip StreetSydney,NSW 2000Tel: 1300 288 664 AuditorBDOAudit Pty LtdLevel 10,12 CreekStreet, Brisbane,QLD4000SolicitorsHopgoodGanimLawyersLevel 8, Waterfront Place, 1 Eagle Street, Brisbane Qld 4000BankersNational Australia BankStock Exchange ListingsAustralian Securities Exchange (ASX code: LKE)OTC QB: LLKKFWebsitewww.lakeresources.com.au21 CORPORATE DIRECTORYfor the year ended 30 June 2021DirectorsStuart Crow -Non-executive ChairmanSteve Promnitz -Managing Directorand CEODr. Nicholas Lindsay -Executive Technical DirectorDr. Robert Trzebski –Non-executive Director Amalia Saenz -Non-executive Director (Appointed 28July2021)CompanySecretary-JointPeter Neilsen(Appointed 27July 2021).Garry Gill Registered office and Principal Place of BusinessLevel 5,126 Phillip Street,Sydney, NSW 2000,AustraliaTel: +61 2 9299 9690Share RegisterAutomic Registry Level 5,126 Phillip StreetSydney,NSW 2000Tel: 1300 288 664 AuditorBDOAudit Pty LtdLevel 10,12 CreekStreet, Brisbane,QLD4000SolicitorsHopgoodGanimLawyersLevel 8, Waterfront Place, 1 Eagle Street, Brisbane Qld 4000BankersNational Australia BankStock Exchange ListingsAustralian Securities Exchange (ASX code: LKE)OTC QB: LLKKFWebsitewww.lakeresources.com.au2LAKE RESOURCES ANNUAL REPORT 2021FY2021 HIGHLIGHTS 110% Revised Kachi Pre-Feasibility Study shows strong cashflows of US$260m p.a., with project value (post-tax NPV8) up 110% to US$1.58 billion based on 25,500 tpa lithium carbonate production Novonix performance tests show Kachi product outperforms commercially available, battery- grade lithium carbonate in lithium-ion battery cells High purity, 99.97% battery quality lithium carbonate produced from Kachi brines by Hazen Research Kachi Definitive Feasibility Study officially commences led by independent engineers Hatch, with environmental impact study also underway Exploration accelerated across broader project portfolio, including testing of Cauchari brines Year-end cash balance $25M following successful $20M placement to global institutional investors in January 2021 CONTENTS Chairman’s Letter Managing Director’s and CEO’s Report Directors Report Auditor’s Independence Declaration Financial Statements Statement of profit or loss and other comprehensive income Statement of financial position Statement of changes in equity Statement of cash flows Notes to the financial statements Directors’ declaration Independent Auditor’s Report Shareholder information Tenement Schedule 4 6 8 29 30 31 32 33 34 35 69 70 74 76 3 LAKE RESOURCES ANNUAL REPORT 2021Chairman's Letter Fellow Shareholder, I am delighted to report to fellow shareholders on a transformational year for your company on the road toward production in 2024. 2021 has been a year of accelerated activity across many areas. Challenges have arisen due to the impacts of the global pandemic, but I am pleased to report your company remains on track and committed to commencement of production of high purity lithium at Kachi in 2024. Milestones we are working towards include: 1) On-site demonstration plant (2-3 months) 2) Off-take discussions (ongoing) 3) DFS and ESIA (Mid 2022) 4) Completion of project financing (Mid 2022) 5) Construction activities (H2/22) 6) Expansion studies to 51,000tpa LCE (2022) 7) Production of 25,500tpa LCE (H2/24) We commenced a variety of studies earlier this year including the Definitive Feasibility Study, Environmental Social Impact Assessment, as well as preparations for construction of the Demonstration Plant on site at Kachi shortly - whilst the Pilot Plant continued test work in California delivering data for the DFS and product for continued test work. During the year we have continued to build the team in Australia and Argentina required to deliver the project and have been fortunate to have had the support of outstanding specialist consultants. I would like to thank them all for the work they have done during trying times this year and I look forward to seeing the culmination of the work when we get to Final Investment Decision in the middle of next year. The company undertook a transformational fundraise in January that secured support from global investment funds that have fully funded the company’s needs through until project funding. I would like to thank shareholders for the role they have played by contributing funds via our bonus options, your support has been appreciated and has allowed us to be well advanced with the equity component of project funding requirements while retaining shareholder value without having to sell portions of the project. Securing support from UKEF and Canada’s EDC with strong expressions of interest to provide lending up to 70 percent of the funding amount at Kachi - including the expansion case - is unprecedented in the lithium sector and demonstrates the quality and robust nature of the projected cashflows of the Kachi project. 4 LAKE RESOURCES ANNUAL REPORT 2021These loan facilities are offered at very low rates of interest compared to traditional sources of development funding adding further to the financial strength of the company in production. In September we welcomed our technology partner Lilac Solutions as a part owner of the Kachi project with an agreement that will allow them to earn up to twenty five percent of the Kachi project by achieving certain strategic milestones and contributing up to US$50m toward project funding. The decision to collaborate with Lilac was clear. Traditional extraction methods take up to two years and only recover about 50 percent of the lithium content. Lake and Lilac’s DLE process produces 99.97% lithium carbonate in under three hours using less land and water, and with a reduced environmental and carbon footprint. These are exciting times to be developing a series of lithium projects. With increasing prices and exponential growth in demand we are well positioned to become a very large supplier to a growing number of potential customers who are now focussed on securing an environmentally sustainable supply of high purity lithium for their cathodes, batteries, and an ever-increasing range of electric vehicles across the globe. I expect in coming months we will announce significant developments regarding offtake and accelerated activity and test work across our other projects alongside two of the largest production assets in Argentina with a view to meeting the growing need for increased supply of a sustainably produced high purity lithium. The company has seen global growth in the demand for lithium rise to levels of magnitude that are multiples of the amount produced in recent years. At the time of writing there are 247 battery manufacturing facilities being developed to meet 2030 demand whilst in 2015 there were three! 151 of these factories will be consuming raw materials by the end of 2021, we are now entering a period of supply deficit that analysts are suggesting will last a decade or longer before supply catches up. I would like to highlight the efforts of your board who have all contributed hugely to the success and progress delivered this year. Their efforts have been equally matched by a resilient and very impressive team of people on the ground in Argentina who have taken on increased responsibility given the lack of travel between Australia and Argentina and delivered outstanding results and progress across all areas of operations. Thank you for your ongoing support, I know 2022 will be a defining year for Lake Resources, delivering great results for all shareholders. Kind regards, Stu Crow Non-Executive Chairman Lake Resources NL 5 LAKE RESOURCES ANNUAL REPORT 2021Managing Director’s and CEO’s Report Lake Resources is well on the path to production of the world’s highest purity lithium with significant ESG benefits from its flagship Kachi Project utilising new direct extraction technology, after a transformative year for the company. Lake’s aim is to produce: ■ World’s highest purity lithium; ■ Using technology-led direct lithium extraction; with ■ Major ESG benefits; to become a ■ New independent clean producer – at scale. A Definitive Feasibility Study (DFS) and an Environmental and Social Impact Assessment (ESIA) covering the Kachi Project were commenced during the year, targeting completion in Q2, 2022. This followed a refreshed Pre-Feasibility Study (PFS). The high purity product was produced from a pilot plant in California, and then performed well in nickel rich NMC622 batteries with an independent third party, Novonix. Post financial year-end, the company was successful in receiving strong expressions of interest from Export Credit Agencies in the UK and Canada (UKEF and EDC), to provide 70 percent of the total finance required for the Kachi Project as long dated, low cost debt. This finance would be triggered by the completion of the DFS and ESIA and a suitable offtake agreement. A formal partnership was announced with Lake’s technology provider, Lilac Solutions Inc, for technology and funding to develop the Kachi Project. Lilac Solutions will contribute technology, engineering teams, and an on-site demonstration plant, earning in to a maximum 25 percent stake in the Kachi project, based on performance-based milestones. Lilac will then be expected to fund approximately US$50 million, equivalent to its pro rata share of future development costs. In summary, over the past 15 months, Lake Resources has been transformed into a well-financed developer with the following milestones: 1. Major Resource (Nov 2018) – The large Kachi resource is aimed to be expanded through drilling to support an expanded production rate of 51,000 tpa LCE, yet only 20 percent of the current resource is utilised over 25 years of production at 25,500tpa LCE; 2. Robust Pre-Feasibility Study (PFS) (Apr 2020, Refreshed March 2021) – Shows strong cashflows (EBITDA) of US$260m per year with an NPV8 post tax of US$1580m, based on a lithium carbonate price of US$15,500/t, a capital cost of US$544m and operating costs of US$4170/t LCE; 3. A Definitive Feasibility Study (DFS) and an Environmental and Social Impact Assessment (ESIA) covering the Kachi Project are well advanced and targeting completion in Q2, 2022; 4. High purity product (Oct 2020; Mar 2021) - Very low impurity product, tested in nickel rich NMC622 batteries with an independent and respected third party, Novonix; 5. Significant ESG benefits - Low carbon, low water and low land use due to Lilac’s direct extraction and brine reinjection which delivers a product sought after by electric vehicle makers; 6 LAKE RESOURCES ANNUAL REPORT 20216. Pilot Plant & Demonstration Plant – Lilac pilot plant successfully operating in California since March 2020, having processed over 50,000 litres of Kachi brine. The demonstration plant is targeted to be on-site in early 2022 to produce larger volume (500kg) samples for prospective offtakers; 7. Project Finance well underway (Aug 2021) - Export Credit Agencies interested to provide 70 percent of total finance, with 11 year debt at interest rates potentially below 3%, triggered by the completion of the DFS and ESIA, and interest in funding the expansion case to 51,000 tpa LCE; 8. Equity Finance - A$63m at end October 2021 with potential option conversion anticipated to deliver a further ~$60m by June 2022; 9. Other Lithium Projects to Develop – Three other lithium brine projects, Cauchari, Olaroz and Paso, to be drilled, sampled and assessed for development with direct lithium extraction processes. Lake Resources aims to be a multi-asset Top 5 global lithium producer over the coming years, seizing the opportunity presented by a widening significant supply gap of lithium due to the increasing demand for electric vehicles and their lithium-ion batteries. Lake, together with our technology partner Lilac Solutions, continue to progress towards the final investment decision and the start of construction of our flagship Kachi Lithium Brine Project in 2022. Argentina continues to be one of the few locations globally where lithium production can increase. Lake is one of only a few companies that can transform into a globally significant producer with a number of projects that can deliver high purity lithium carbonate at scale with meaningful ESG benefits. Finally, I would like to thank our shareholders, directors, employees, contractors, suppliers and all others involved with Lake Resources in what has been a standout year for your company. We look forward to achieving new milestones in 2022 and delivering even more growth in shareholder value as we advance towards production. Kind regards, Steve Promnitz Managing Director/CEO Lake Resources NL 7 LAKE RESOURCES ANNUAL REPORT 20218 LAKE RESOURCES NLDIRECTORS REPORTfor the year ended 30 June 2021The Directors present their report, together with the financial statements, on the Consolidated entity(referred to hereafter as ‘Lake’ or the 'Consolidated entity') consisting of Lake Resources NL (referred to hereafter as the Companyor 'parent entity') and the entities it controlled at the end of, or during, the year ended 30 June 2021. DirectorsThe following personswere Directors of Lake Resources NL during the whole of the financial year and up to the date of this report, unless otherwise stated:S. Crow (Non-Executive Chairman)S. Promnitz (Managing Director)N. Lindsay (Executive Technical Director)R. Trzebski (Non-Executive Director) A. Saenz -Non-Executive Director (Appointed 28July2021)Principal activitiesDuring the financial year the principal activities of the Consolidated entityconsisted of:•Exploration and development of lithium brine projects in Argentina.DividendsThere were no dividends paid, recommended,or declared during the current or previous financial year.Review of OperationsThe loss for the Consolidated entityafter providing for income tax amounted to $2,894,223 (2020:$4,902,896).Corporate StrategyLake is a clean lithium developer utilising direct extraction technology for the development of highpurity lithium products with significant ESG benefits from its flagship Kachi Project, as well as three other lithium brine projects in Argentina. No mining is involved in the brine processing. Lake holds 2,200km2 of leasesin a prime location within the Lithium Triangle, where 40% of the world’s lithium is produced at the lowest cost. A key difference in Lake’s development plan to lithium production is to use an efficient direct lithium extraction method (DLE) from our technology partner, Lilac Solutions Inc. This method will enable Lake to be an efficient, cost competitive supplier of high-purity lithiumwith significant ESG benefits with a low carbon (CO2) footprint, low water use and low land use. These products arein demand from Tier 1 electric vehicle makers and battery makers(ESG = Environmental, Social, Governance). The process allows for rapid scaling of production and Lake has a study on an expansion case at the Kachi Projectto double production to 51,000 tpa LCE, initiated due to increasing demand(refer ASX announcement 31 July 2021). Such scalability can then be brought to the other projects potentially making Lake a Top 5 global producer in the future. Operations Overview of Operations for the YearKachi Lithium Brine Project - Catamarca Province, ArgentinaLake’s 100%-owned Kachi Lithium Brine Project (Kachi) in Catamarca province, NW Argentina, covers an entire large lithium brine bearing basin with 39 mining leases (74,000 hectares). Lake aims to develop the project into production of 25,500 tpa battery quality lithium carbonate in 2024 by using the efficient DLE method from Lilac Solutions, as established in the Kachi Pre-Feasibility Study (PFS). Kachi has a large indicated and inferred resource of 4.4 million tonnesLCE (Indicated 1.0Mt, inferred3.4Mt) (refer ASX announcement 27 November 2018). 1LAKE RESOURCES ANNUAL REPORT 20219 LAKE RESOURCES NL DIRECTORS REPORTfor the year ended30 June2021During the year ended 30 June 2021, Lakeinitiated a Definitive Feasibility Study (DFS) in January 2021,withHatch as lead consultant, and is progressing, based on the outcomes of a refreshed and robustpre-feasibility study (PFS) over the Kachi Project(refer ASX announcement 28 April 2020, refreshed 17 March 2021). The PFSshows a high margin, long-life potential operation with cost-competitive production, withstrong financial results with US$1.6 billionNPV8 (post tax), 35% IRR and US$260 million annual EBITDA.The capital cost (capex) estimate is US$544 million, with an operating cost (opex) of US$4178/tonne Li2CO3.The 25-year modelled production at 25,500 tonnes per annum Lithium Carbonate Equivalent (LCE) utilises about 20% of the large JORC Mineral Resource (Indicated and Inferred) of 4.4 million tonnes LCE.The Environmental and Social Impact Study (ESIA) is underway with Knight Piesold.An energy optimisation study has shown that solar hybrid power is suitable for the project which delivers a low carbon footprint and is expectedto lower the operating costs.An expansion case to double production to 51,000 tpa LCE has been initiated due to increasing demand. Additional drilling is underway at the Kachi Projectto support the expansion of future production, targeting 51,000tpa LCE.A four well, 1,600m drill program aims to upgrade Kachi’s 4.4 Mt LCE Total Resource from M&I Resources to Reserves for Kachi’s DFS and for production expansion study(refer ASX announcements 7 July 2021 and31July2021). An efficient, disruptive clean direct lithium extraction (DLE) technology, that canproduce sustainable high purity lithium, with a smaller environmental footprint, has been developed by our technology partner, Lilac Solutions Inc, in California(Lilac). Lilac’s DLE process adapts a widely used water treatment process called ion exchange to produce lithium. This allows the return of virtually allwater (brine) to its source without changing its chemistry, apart from lithium removal. The land use is significantly reduced due to the removal of evaporation ponds and the plan to use solar hybrid power ensures a low carbon footprint.Lilachave receivedthe backing of the Bill Gates-led Breakthrough energy fund,MIT’s The Engine fundand Chris Sacca’s Lowercarbon Capital fund, among others. Battery quality lithium carbonate (99.97% purity) has been produced from Kachi brine samples with very low impurities and high (80-90%) lithium recoveries (refer ASX announcement 20 October2020). Test results were incorporated into the PFS. The Lilac’s direct extraction pilot plant modules in California, using brines from Lake’s Kachi Lithium Brine Project, have produced lithium chloride for conversion into lithium carbonate.Hazen Research Inc, an independent assay laboratory, produced high purity battery quality lithium carbonate (99.97% purity) with very low impurities (refer ASX announcement 20 October 2020). This product performed successfully in nickel-rich NMC622-based lithium-ion battery test cells based on initial testing by Novonix (refer ASX announcement 2 March 2020). Discussions continue with potential offtakers for the products, both battery /cathode makers and electric vehicle companies. The table below (Table 1) outline the resource reported on 27 November 2018 in accordance with the JORC Code (2012) and estimated by a Competent Person as defined by the JORC Code. The resource estimate has not changed materially from November 2018 to 30 June 2021.2LAKE RESOURCES ANNUAL REPORT 202110 LAKE RESOURCES NL DIRECTORS REPORTfor the year ended30 June2021Table 1: Kachi Mineral Resource Estimate - November 2018 (JORC Code 2012 Ed.)RESOURCE ESTIMATE KACHIIndicatedInferredTotal ResourceArea km217.10158.30175.40Aquifer volume km364147Brine volume km30.653.23.8Mean drainable porosity % (Specific yield)10.97.57.9ElementLiKLiKLiKWeightedmean concentration mg/L2895,8802094,1802114380Resource tonnes 188,0003,500,000638,00012,500,000826,00016,000,000Lithium Carbonate Equivalent tonnes1,005,0003,394,0004,400,000Potassium Chloride tonnes6,705,00024,000,00030,700,000Lithium is converted to lithium carbonate (Li2CO3) with a conversion factor of 5.32Potassium is converted to potassium chloride (KCl) with a conversion factor of 1.91 Mg/Li ratio averages 4.7 Competent Person’s Statement–Kachi Lithium Brine ProjectThe information contained in this report relating to Exploration Results has been compiled by Mr Andrew Fulton. Mr Fulton is aHydrogeologist and a Member of the Australian Institute of Geoscientists and the Association of Hydrogeologists. Mr Fulton hassufficient experience that is relevant to the style of mineralisation and type of deposit under consideration and to the activity being undertaken to qualify as a competent person as defined in the 2012 edition of the Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves. Andrew Fulton is an employee of Groundwater Exploration Services Pty Ltd and an independent consultant to Lake Resources NL. Mr Fulton consents to the inclusion in this announcement of this information in the form and context in which it appears. The information is repeated in an ASX announcement of 20 November 2018 by Lake Resources and is an accurate representation of the available datafrom initial exploration at the Kachi projectOlaroz/Cauchari & Paso Lithium Brine Projects -Jujuy Province, ArgentinaLake holds mining leases over ~45,000 hectares in two areas in Jujuy Province in NW Argentina - Lake’s Olaroz and Cauchari Lithium Brine Projects and the Paso Lithium Brine Project, 100% owned by Lake.The Cauchari Lithium Brine Project was drilled successfully in 2019, which demonstrated that the high-grade lithium brines in the adjoining world class project extended into Lake’s 100% owned leases, withmultiple high-grade lithium brines zones over a 506m interval (102m to 608m depth).Results ranged from 421 to 540 mg/L lithium (493 mg/L average) in detailed sampling with higher-grade results that averaged493 mg/L lithium over 343m (from 117m to 460m), up to 540 mg/L,Direct lithium extraction methods will be testedonlithium brine samples from the Cauchari Project. This will be followed by a scoping study for future production, including environmental impact studies and drilling for a resource statement.Drilling at the Olaroz and Paso projects is planned when drilling is permitted. The Catamarca Pegmatite project will be progressed after the other projects.3LAKE RESOURCES NL DIRECTORS REPORTfor the year ended30 June2021Table 1: Kachi Mineral Resource Estimate - November 2018 (JORC Code 2012 Ed.)RESOURCE ESTIMATE KACHIIndicatedInferredTotal ResourceArea km217.10158.30175.40Aquifer volume km364147Brine volume km30.653.23.8Mean drainable porosity % (Specific yield)10.97.57.9ElementLiKLiKLiKWeightedmean concentration mg/L2895,8802094,1802114380Resource tonnes 188,0003,500,000638,00012,500,000826,00016,000,000Lithium Carbonate Equivalent tonnes1,005,0003,394,0004,400,000Potassium Chloride tonnes6,705,00024,000,00030,700,000Lithium is converted to lithium carbonate (Li2CO3) with a conversion factor of 5.32Potassium is converted to potassium chloride (KCl) with a conversion factor of 1.91 Mg/Li ratio averages 4.7 Competent Person’s Statement–Kachi Lithium Brine ProjectThe information contained in this report relating to Exploration Results has been compiled by Mr Andrew Fulton. Mr Fulton is aHydrogeologist and a Member of the Australian Institute of Geoscientists and the Association of Hydrogeologists. Mr Fulton hassufficient experience that is relevant to the style of mineralisation and type of deposit under consideration and to the activity being undertaken to qualify as a competent person as defined in the 2012 edition of the Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves. Andrew Fulton is an employee of Groundwater Exploration Services Pty Ltd and an independent consultant to Lake Resources NL. Mr Fulton consents to the inclusion in this announcement of this information in the form and context in which it appears. The information is repeated in an ASX announcement of 20 November 2018 by Lake Resources and is an accurate representation of the available datafrom initial exploration at the Kachi projectOlaroz/Cauchari & Paso Lithium Brine Projects -Jujuy Province, ArgentinaLake holds mining leases over ~45,000 hectares in two areas in Jujuy Province in NW Argentina - Lake’s Olaroz and Cauchari Lithium Brine Projects and the Paso Lithium Brine Project, 100% owned by Lake.The Cauchari Lithium Brine Project was drilled successfully in 2019, which demonstrated that the high-grade lithium brines in the adjoining world class project extended into Lake’s 100% owned leases, withmultiple high-grade lithium brines zones over a 506m interval (102m to 608m depth).Results ranged from 421 to 540 mg/L lithium (493 mg/L average) in detailed sampling with higher-grade results that averaged493 mg/L lithium over 343m (from 117m to 460m), up to 540 mg/L,Direct lithium extraction methods will be testedonlithium brine samples from the Cauchari Project. This will be followed by a scoping study for future production, including environmental impact studies and drilling for a resource statement.Drilling at the Olaroz and Paso projects is planned when drilling is permitted. The Catamarca Pegmatite project will be progressed after the other projects.3LAKE RESOURCES ANNUAL REPORT 202111 LAKE RESOURCES NL DIRECTORS REPORTfor the year ended30 June2021Table 1: Kachi Mineral Resource Estimate - November 2018 (JORC Code 2012 Ed.)RESOURCE ESTIMATE KACHIIndicatedInferredTotal ResourceArea km217.10158.30175.40Aquifer volume km364147Brine volume km30.653.23.8Mean drainable porosity % (Specific yield)10.97.57.9ElementLiKLiKLiKWeightedmean concentration mg/L2895,8802094,1802114380Resource tonnes 188,0003,500,000638,00012,500,000826,00016,000,000Lithium Carbonate Equivalent tonnes1,005,0003,394,0004,400,000Potassium Chloride tonnes6,705,00024,000,00030,700,000Lithium is converted to lithium carbonate (Li2CO3) with a conversion factor of 5.32Potassium is converted to potassium chloride (KCl) with a conversion factor of 1.91 Mg/Li ratio averages 4.7 Competent Person’s Statement–Kachi Lithium Brine ProjectThe information contained in this report relating to Exploration Results has been compiled by Mr Andrew Fulton. Mr Fulton is aHydrogeologist and a Member of the Australian Institute of Geoscientists and the Association of Hydrogeologists. Mr Fulton hassufficient experience that is relevant to the style of mineralisation and type of deposit under consideration and to the activity being undertaken to qualify as a competent person as defined in the 2012 edition of the Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves. Andrew Fulton is an employee of Groundwater Exploration Services Pty Ltd and an independent consultant to Lake Resources NL. Mr Fulton consents to the inclusion in this announcement of this information in the form and context in which it appears. The information is repeated in an ASX announcement of 20 November 2018 by Lake Resources and is an accurate representation of the available datafrom initial exploration at the Kachi projectOlaroz/Cauchari & Paso Lithium Brine Projects -Jujuy Province, ArgentinaLake holds mining leases over ~45,000 hectares in two areas in Jujuy Province in NW Argentina - Lake’s Olaroz and Cauchari Lithium Brine Projects and the Paso Lithium Brine Project, 100% owned by Lake.The Cauchari Lithium Brine Project was drilled successfully in 2019, which demonstrated that the high-grade lithium brines in the adjoining world class project extended into Lake’s 100% owned leases, withmultiple high-grade lithium brines zones over a 506m interval (102m to 608m depth).Results ranged from 421 to 540 mg/L lithium (493 mg/L average) in detailed sampling with higher-grade results that averaged493 mg/L lithium over 343m (from 117m to 460m), up to 540 mg/L,Direct lithium extraction methods will be testedonlithium brine samples from the Cauchari Project. This will be followed by a scoping study for future production, including environmental impact studies and drilling for a resource statement.Drilling at the Olaroz and Paso projects is planned when drilling is permitted. The Catamarca Pegmatite project will be progressed after the other projects.3LAKE RESOURCES NL DIRECTORS REPORTfor the year ended30 June2021Corporateand FinancialA majoradvance was made towards future cleanlithiumproductionduringand immediately post the financialyear from Lake’sflagship Kachi Lithium Brine Project in Catamarca Province. 1.Major Resource (Nov 2018) – Only 20 percent of the current Kachi resourceis utilisedover 25 years ofproduction at 25,500tpa LCE with drilling now underway to upgrade the resource tosupport anexpanded production rate of 51,000 tpaLCE;2.Robust Pre-Feasibility Study (PFS) (Apr 2020, Refreshed March 2021) - Strong cashflows (EBITDA) ofUS$260m per year with an NPV8 post tax of US$1580m, based on a capital cost of US$544m andoperating costs of US$4170/t LCE;3.A Definitive Feasibility Study (DFS) and an Environmental and Social Impact Assessment (ESIA)covering the Kachi Project are well advanced and targeting completion in Q2, 2022;4.High purity product (Oct 2020; Mar 2021) - Very low impurity product, tested in nickel rich NMC622batteries with an independent and respected third party, Novonix;5.Significant ESG benefits - Low carbon products are in demand by electric vehicle and grid scalebattery makers and the Kachi project can deliver an important reduction in brine and water use, andland use due to Lilac’s direct extraction and brine reinjection.6.Pilot Plant & Demonstration Plant - Pilot plant has been successfully operating in California sinceMarch 2020. The demonstration plant is targeted to be on-site in Q1 2022 to produce larger volume(50kg to 500kg) samples for prospective offtake partners.7.Project Finance well underway (Aug 2021) -Export Credit Agencies interested to provide 70 percent oftotal finance, triggered by the completion of DFS and ESIA.8.Equity Finance - A$25m at end June 2021 with potential option conversion to anticipated to deliver afurther ~$20m and new Bonus options to deliver ~A$25m in late Oct 2021 and potentially a further$70m in June 2022, through further options conversions, currently out-of-the-money.Lake is funded to the final investment decision (FID) on construction finance for Kachi, anticipated in mid-2022, followed by construction, targeting 25,500 tonnes per annum (tpa) lithium carbonate (LCE) production, with commissioning and production in 2024. Equity capital raisings were conducted during the financial year to sustain the development of the Kachi Project. On 28 August 2020, 85,666,667million shares were issued at $0.03per ordinary share by way of private placement to sophisticated and professional investors to raise $2.55 million before costs. On 28 August 2020, 15,000,000shares were issued at $0.033 per ordinary share in accordance with a Controlled Placement Agreement. On 25 September 2020, 15,000,000shares were issued at $0.06 per ordinary share in accordance with a Controlled Placement Agreement. A $200,000 loan, raised in July 2020, was retired with interest. There arecurrentlyno loans are outstanding. On 19 January 2021, 40 million shares were issued at $0.0844 per ordinary share in accordance with a Controlled Placement Agreement to raise A$3.375 million. The Company entered into a Controlled Placement Agreement (the Agreement) in August 2018 with Acuity Capital Pty Ltd and the facility was extended and upsized on 27 November 2020. Unlisted options were converted in December/January including 18,300,000 options with an exercise price of $0.046 and 5,555,000 options with an exercise price of $0.08.On 25 January2021, Lake had secured commitments in a private placement for A$20.6 million (before costs) to issue approximately 125 million new ordinary shares at an offer price of $0.165 per share to global institutional investors. Every twooffer shares hadone optionattached(73,750,000 unlisted options) with an exercise price of A$0.30 and a 9 Mar 2023 expiry.Roth Capital Partners LLC acted as sole placement agentwhich included fees of11,250,000 optionsat the same price (included above). The Placement was priced at 6% discount to the 5-dayVWAP and a 12% premium to 10-day VWAP.Listed options wereprogressively convertedin H2 FY, 2021, with an exercise price of $0.10 and an expiry of 4LAKE RESOURCES ANNUAL REPORT 202112 LAKE RESOURCES NL DIRECTORS REPORTfor the year ended30 June202115 June 2021withan uptake ofapproximately 93%whichraised approximately $4.8 million.Lake Resources continued itssecondary compliance listing on the OTCQB marketwith the ticker codeLLKKF, with real time electronic trading, clearance and settlement established fromJanuary2021.Impact of COVID-19 on OperationsThe impact of the Coronavirus (COVID-19) pandemic is ongoing and while it has been financially neutral for theConsolidated entityup to 30 June 2021, it is not practicable to estimate the potential impact, positive or negative, after the reporting date. The situationcontinues to develop with significant restrictions on travel and movement until 80% vaccination rates are achieved in Australia while the Argentine Government continues to expand its vaccinations,together withmaintaining social distancing requirements, quarantine,andtravel restrictions. Further information on the impact is detailed in Note 1(iv) of the financial statements. Significant changes in thestateof affairsEquity capitalraisings and options conversions were conductedduring thefinancial year tosustain thedevelopment of the Kachi Project.On 28 August 2020, 85,666,667shares were issued at $0.03 per ordinary share by way of private placement to sophisticated and professional investors to raise $2.55 million before costs. On 28 August 2020, 15,000,000shares were issued at $0.033 per ordinary share in accordance with a Controlled Placement Agreement. On 25 September 2020, 15,000,000shares were issued at $0.06 per ordinary sharein accordance with a Controlled Placement Agreement. A $200,000 loan, raised in July 2020, was retired with interest so that no loans are outstanding. On 19 January 2021, 40,000,000shares were issued at $0.0844 per ordinary share in accordance with a Controlled Placement Agreement to raise A$3.375 million. The Company entered into a Controlled Placement Agreement (the Agreement) in August 2018 with Acuity Capital Pty Ltd and the facility was extended and upsized on 27 November 2020. Unlisted options were converted in December/January including 18,300,000 options with an exercise price of $0.046 and 5,555,000 options with an exercise price of $0.08.On 25 January 2021, Lake had secured commitments in a private placement for A$20.6 million (before costs) to issue approximately 125,000,000new ordinary shares at an offer price of $0.165 per share to global institutional investors. Every twooffer shares hadone optionattached(73,750,000 unlisted options) with an exercise price of A$0.30 and a 9 Mar 2023 expiry.Roth Capital Partners LLC acted as sole placement agentwhich included fees of11,250,000 optionsat the same price (included above). The Placement was priced at 6% discount to the 5-dayVWAP and a 12% premium to 10-dayVWAP.Listed optionswereprogressively convertedin H1, 2021, with an exercise price of $0.10 and an expiry of 15 June 2021 with an uptake of approximately 93% which raised approximately $4.8 million. Therewerenoothersignificantchanges inthestateofaffairsoftheConsolidatedentityduringthefinancial year.Matters subsequent to theend of the financial yearSubsequent to the end of the financial year, the Consolidated entityraised a further $42,890,670through the conversion of unlisted options, which included 14,000,000Directoroptions with an exercise price of $0.09 (expiry July 2021) and 124,784,861 unlisted options with an exercise prices of A$0.30 and A$0.35. On the 28 July 2021 Lake announced a pro-rata non-renounceable issue to Eligible Shareholders of one free Bonus Option for every ten Shares held on the Record Date of 24 August 2021 (Bonus Option Offer), and for the issue to Eligible Option holders of one further free Additional Option for every Bonus Option exercised prior to the Bonus Option Expiry Date of 15 October 2021 (Additional Option Offer). Each Bonus Option gives Eligible Shareholders the opportunity, but not the obligation, to subscribe for an additional Share in the Company at the Exercise Price of $0.35 per Bonus Option before 5:00pm on the Bonus Option Expiry Date (15 October 2021).Each Additional Option gives Eligible Option holders the opportunity, but not the obligation, to subscribe for an additional Share in the Company at the Exercise Price of $0.75 per Additional Option before 5:00pm on the Additional Option Expiry Date (15 June 2022).5LAKE RESOURCES ANNUAL REPORT 202113 LAKE RESOURCES NL DIRECTORS REPORTfor the year ended30 June202115 June 2021withan uptake ofapproximately 93%whichraised approximately $4.8 million.Lake Resources continued itssecondary compliance listing on the OTCQB marketwith the ticker codeLLKKF, with real time electronic trading, clearance and settlement established fromJanuary2021.Impact of COVID-19 on OperationsThe impact of the Coronavirus (COVID-19) pandemic is ongoing and while it has been financially neutral for theConsolidated entityup to 30 June 2021, it is not practicable to estimate the potential impact, positive or negative, after the reporting date. The situationcontinues to develop with significant restrictions on travel and movement until 80% vaccination rates are achieved in Australia while the Argentine Government continues to expand its vaccinations,together withmaintaining social distancing requirements, quarantine,andtravel restrictions. Further information on the impact is detailed in Note 1(iv) of the financial statements. Significant changes in thestateof affairsEquity capitalraisings and options conversions were conductedduring thefinancial year tosustain thedevelopment of the Kachi Project.On 28 August 2020, 85,666,667shares were issued at $0.03 per ordinary share by way of private placement to sophisticated and professional investors to raise $2.55 million before costs. On 28 August 2020, 15,000,000shares were issued at $0.033 per ordinary share in accordance with a Controlled Placement Agreement. On 25 September 2020, 15,000,000shares were issued at $0.06 per ordinary sharein accordance with a Controlled Placement Agreement. A $200,000 loan, raised in July 2020, was retired with interest so that no loans are outstanding. On 19 January 2021, 40,000,000shares were issued at $0.0844 per ordinary share in accordance with a Controlled Placement Agreement to raise A$3.375 million. The Company entered into a Controlled Placement Agreement (the Agreement) in August 2018 with Acuity Capital Pty Ltd and the facility was extended and upsized on 27 November 2020. Unlisted options were converted in December/January including 18,300,000 options with an exercise price of $0.046 and 5,555,000 options with an exercise price of $0.08.On 25 January 2021, Lake had secured commitments in a private placement for A$20.6 million (before costs) to issue approximately 125,000,000new ordinary shares at an offer price of $0.165 per share to global institutional investors. Every twooffer shares hadone optionattached(73,750,000 unlisted options) with an exercise price of A$0.30 and a 9 Mar 2023 expiry.Roth Capital Partners LLC acted as sole placement agentwhich included fees of11,250,000 optionsat the same price (included above). The Placement was priced at 6% discount to the 5-dayVWAP and a 12% premium to 10-dayVWAP.Listed optionswereprogressively convertedin H1, 2021, with an exercise price of $0.10 and an expiry of 15 June 2021 with an uptake of approximately 93% which raised approximately $4.8 million. Therewerenoothersignificantchanges inthestateofaffairsoftheConsolidatedentityduringthefinancial year.Matters subsequent to theend of the financial yearSubsequent to the end of the financial year, the Consolidated entityraised a further $42,890,670through the conversion of unlisted options, which included 14,000,000Directoroptions with an exercise price of $0.09 (expiry July 2021) and 124,784,861 unlisted options with an exercise prices of A$0.30 and A$0.35. On the 28 July 2021 Lake announced a pro-rata non-renounceable issue to Eligible Shareholders of one free Bonus Option for every ten Shares held on the Record Date of 24 August 2021 (Bonus Option Offer), and for the issue to Eligible Option holders of one further free Additional Option for every Bonus Option exercised prior to the Bonus Option Expiry Date of 15 October 2021 (Additional Option Offer). Each Bonus Option gives Eligible Shareholders the opportunity, but not the obligation, to subscribe for an additional Share in the Company at the Exercise Price of $0.35 per Bonus Option before 5:00pm on the Bonus Option Expiry Date (15 October 2021).Each Additional Option gives Eligible Option holders the opportunity, but not the obligation, to subscribe for an additional Share in the Company at the Exercise Price of $0.75 per Additional Option before 5:00pm on the Additional Option Expiry Date (15 June 2022).5LAKE RESOURCES NL DIRECTORS REPORTfor the year ended30 June2021On 30 August 2021, 110,416,119 Bonus Options were issued at the Exercise Price of $0.35 per Bonus Option and an Expiry Date of15 October 2021. As at 28 October,83,904,236 options had been converted raising afurther $ 29,366,483 million.On 22 September 2021, Lakeformallypartneredwith Lilac for the technology and funding to develop the Kachi Project Under the agreement, Lilac will contribute technology, engineering teams, and an on-site demonstrationplant, earning in to a maximum 25%stake in Lake’s Kachi project based on performance-based milestones. Lilac, after earning its interest in Kachi, will be expected to fund approximately US$50 million, equivalent to its pro rata share of future developmentcosts-aligning innovation, funding, development, and production. Lilac can earn in to Kachi in the following stages:Stage 1: Lilac will earn 10%projectequityoncommitting to fund at its cost the completion of testing of itstechnologyfor the Kachiproject in accordance with an agreed timeline.Stage 2:Lilac will earn a further 10%on satisfying all agreed testingcriteria using the demonstration plant atthe Kachi Project inaccordance with an agreed timeline.Stage 3: Lilac may earn a further5%on refined lithium chemical product from Kachiachieving the highestagreed qualification standards with certain potential offtake partners.Other Key Terms:Lilac will provide technology services and its proprietary ion-exchange materials for the life of the project, subject to meeting the testing criteria and certain agreements being finalized and entered into.Both Lake and Lilac will have pre-emptive rights in respect of each other’s interests.Lake has certain buy back rights if Lilac does not meet agreed testing criteria or if an acceptable services agreement cannot be agreed with Lilac within an agreed timeline.On 11 August 2021, Lakeannounced that the UK Export Finance(UKEF), the Export Credit Agency(ECA)of the United Kingdom, hadprovided a strong Expression of Interest to support approximately 70% of the total finance required for Lake’s Kachi Project, subject to standard project finance terms,including, among others, suitable structured offtake contracts, the successful completion of Kachi’s Definitive Feasibility Study (DFS),andan Environmental and Social Impact Assessment (ESIA) to Equator Principles. TheECA led project finance would deliver a significantly lower cost of capital than traditional financing structures, with the principal repaid over an 8.5-year period post-construction.UKEF indicated that debt financeisavailable to support expanded production to 51,000 tpa of high purity lithium carbonate equivalent.UKEF’s Expression of Interest will encourage a UK-led sourcing strategy while allowing flexibility for other leading ECAs to participate. Canada’s Export Credit Agency, EDC, provided a Letter of Interest to potentially work alongside UKEFto support approximately 70% of the total finance required for Lake’s Kachi Project, subject to similarstandard project finance termsas UKEF (refer ASX announcement 28 September 2021). EDC indicated the ability to provide direct lending to the project up to US$100 million, subject to sourcing requirements. Such direct lending would be at the attractive OECD Fixed Commercial Interest Reference Rate (“CIRR”) applicable at the date of signing, which is currently 1.77% fixed. No other matter or circumstance has arisen since 30 June 2021that has significantly affected, or may significantly affect the Consolidated entity's operations, the results of those operations, or the Consolidated entity's state of affairs in future financial years.Likely developments and expected results of operationsThere has been a significant expansion in battery megafactories with 225 megafactories forecast to be in operation by 2030 These facilities prefer high quality lithium products, especially with the ESG benefit that Lake’sproducts will provide. A significant and growing supply deficit is forecast to develop in late 2021 through to 2022 which requires significant new scalable supply of lithium products. The focus for the Consolidated entity is to be a clean lithium developer utilising direct extraction technology for the development of sustainable, high purity lithium from its flagship Kachi Project. A definitive feasibility study LAKE RESOURCES ANNUAL REPORT 202114 LAKE RESOURCES NL DIRECTORS REPORTfor the year ended30 June2021(DFS)is underwayon the Kachi project together with an Environmental and Social Impact Assessment (ESIA). When the studies are completed, together with suitably structured offtake contracts, the Export Credit Agency (ECA) led project finance should be triggered facilitatingthe completion of approximately 70% of the total finance required for Lake’s Kachi Project. Lake formally partnered with Lilac for the technology and funding to develop the Kachi Project (refer ASX announcement 22 September 2021). Under the agreement, Lilac will contribute technology, engineering teams, and an on-site demonstration plant, earning in to a maximum 25% stake in Lake’s Kachi project based on performance-based milestones. It is anticipated that Lake will reduce its equity holding in the Kachi project as Lilac reaches these milestones.Offtake discussions will continue whichshould lead tosuitably structured offtake contractsfor all parties.Environmental regulationTheConsolidated entityis subject to and compliant with all aspects of environmental regulation of its exploration and mining activities. The Directors are not aware of any environmental law that is not being complied with.Information on DirectorsNameStuart CrowTitleNon-Executive ChairmanExperience and expertiseMr Crow has global experience in financial services, corporate finance, investor relations, international markets,and stock broking. Stuart is passionate about assisting emerging listed companies to attract investors and capital and has owned and operatedhis own businesses in financial advisory for over 30 yearsOther current DirectorshipsNon-ExecutiveDirectorToddRiverResourcesLtd(ASX:TRT)Non-Executive Director Ironridge ResourcesLimited (AIM: IRR)Former Directorships (last 3 years)NoneNameStephen Promnitz TitleManagingDirectorand CEOExperience and expertiseMr Promnitz led Lake since 2016, bringing natural resources and energy experience with a focus on South America and South-East Asia, and delivered the lithium project portfolio. Previously he was CEO of small/mid-tier companies or senior manager with global resource companies (Rio Tinto, WMC) together with holding senior corporate finance roles with Westpac and Citigroup.Other current DirectorshipsNoneFormer Directorships (last 3 years)None7LAKE RESOURCES ANNUAL REPORT 202115 LAKE RESOURCES NL DIRECTORS REPORTfor the year ended30 June2021(DFS)is underwayon the Kachi project together with an Environmental and Social Impact Assessment (ESIA). When the studies are completed, together with suitably structured offtake contracts, the Export Credit Agency (ECA) led project finance should be triggered facilitatingthe completion of approximately 70% of the total finance required for Lake’s Kachi Project. Lake formally partnered with Lilac for the technology and funding to develop the Kachi Project (refer ASX announcement 22 September 2021). Under the agreement, Lilac will contribute technology, engineering teams, and an on-site demonstration plant, earning in to a maximum 25% stake in Lake’s Kachi project based on performance-based milestones. It is anticipated that Lake will reduce its equity holding in the Kachi project as Lilac reaches these milestones.Offtake discussions will continue whichshould lead tosuitably structured offtake contractsfor all parties.Environmental regulationTheConsolidated entityis subject to and compliant with all aspects of environmental regulation of its exploration and mining activities. The Directors are not aware of any environmental law that is not being complied with.Information on DirectorsNameStuart CrowTitleNon-Executive ChairmanExperience and expertiseMr Crow has global experience in financial services, corporate finance, investor relations, international markets,and stock broking. Stuart is passionate about assisting emerging listed companies to attract investors and capital and has owned and operatedhis own businesses in financial advisory for over 30 yearsOther current DirectorshipsNon-ExecutiveDirectorToddRiverResourcesLtd(ASX:TRT)Non-Executive Director Ironridge ResourcesLimited (AIM: IRR)Former Directorships (last 3 years)NoneNameStephen Promnitz TitleManagingDirectorand CEOExperience and expertiseMr Promnitz led Lake since 2016, bringing natural resources and energy experience with a focus on South America and South-East Asia, and delivered the lithium project portfolio. Previously he was CEO of small/mid-tier companies or senior manager with global resource companies (Rio Tinto, WMC) together with holding senior corporate finance roles with Westpac and Citigroup.Other current DirectorshipsNoneFormer Directorships (last 3 years)None7LAKE RESOURCES NL DIRECTORS REPORTfor the year ended30 June2021NameDr NicholasLindsayTitleExecutive Technical DirectorExperience and expertiseDr Nicholas Lindsay is an experienced mining executive, with a BSc (Hons) degree in Geology, a PhD in Metallurgy and Materials Engineering as well as an MBA. He has successfully taken companies in South America, such as Laguna Resources which he led as Managing Director, from inception to listing, development and subsequent acquisition. Dr Lindsay has previously held the role of CEO of Manuka Resources Ltd, and the position of President –Chilean Operations for Kingsgate Consolidated Ltd.Other current DirectorshipsNoneFormer Directorships (last 3 years)ValorResources (to October 2020)NameDr Robert Trzebski TitleNon-Executive DirectorExperience and expertiseDr. Trzebski is currently Chief Operating Officer of Austmine Ltd and holds a degree in Geology, PhD in Geophysics, Masters in Project Managementand has over 30 years professional experience in project management and mining services. He has considerable operating and commercial experience in Argentina and Chile, as a Non-Executive Directorof Austral Gold since 2007, listed on the ASX and TSX-V and is Chairman of the Audit and Risk Committee. His role with Austmine has allowed him to develop considerable contacts across the operating and technology space of the global resources industry. Dr. Trzebski is also a fellow of the Australian Institute of Mining and Metallurgy and is fluent in Spanish and German as well as English.Other current DirectorshipsAustral Gold (ASX: AGD)Former Directorships (last 3 years)None8LAKE RESOURCES ANNUAL REPORT 202116 LAKE RESOURCES NL DIRECTORS REPORTfor the year ended30 June2021NameAmalia Saenz (appointed 28 July 2021)TitleNon-Executive DirectorExperience and expertiseMs. Amalia Sáenz is a partner at the legal firm, Zang, Bergel & Viñes, in Buenos Aires and leads the Energy and Natural Resources practice. Sra. Sáenz joined the firm some years ago to meet increased demand from clients looking to invest in Argentina’s natural resources space. Previously, Ms. Sáenz was with respected legal firm Brons & Salas, in Buenos Aires, and her practice covered the full scope of natural resources and energy and oil and gas, with specific focus on tenders, acquisitions, financing, joint venture and operation agreements in Argentina. She is a leading member of the Association of International Petroleum Negotiators. Also, in the past, Ms. Sáenz was the Legal Manager with Bridas Corporation living in Central Asia -as well in United Kingdom- experiencing working in an exploration and production operations in a context of a mixture of cultures. Other current DirectorshipsNone.Former Directorships (last 3 years)None.Notes:•Other current Directorships quoted aboveare current Directorshipsforlisted entities only and excludesDirectorshipsof allother typesof entities, unless otherwise stated.•FormerDirectorships (last 3 years)' quoted aboveareDirectorships held in the last 3 yearsforlisted entities only and excludesDirectorshipsofallother typesof entities, unless otherwise stated.CompanySecretariesThe CompanySecretary in office at the end of the financial year was Mr Garry Gill. Mr Gill is a chartered accountant with more than 30 years’ experience in all facets of corporate, financial and administrative functions, Mr Gill has served in a range of positions including as CFO, company secretary and other senior executive positions for anumber of listed and unlisted public companies. These have included serving as finance director and company secretary of Jupiters Limited, CFO/Corporate Services Manager of South Bank Corporation in Brisbane, before forming a consultancy service for smallcap ASX companies over the last decade. He has delivered improved strategic analysis and financial management, streamlined budgets, refinancing, and stakeholder management of small/mid cap resource companies. Mr Peter Neilsen who was appointed on 27 July 2021, isa chartered accountant with more than 20 years’ experience in all facetsof financial management, asset management and leadership. He has served in a range of positions including as Chief Financial Officer (CFO), company secretary, finance manager and other senior executive positions for a number of listed and unlisted companies in the energy and natural resources sector. These have included Barrick, Xstrata and Round Oak. Mr Neilsen has been involved in reducing operation expenses up to $100M through cost analysis, performance improvements and contract negotiations, acquisitions of up to $80M and managed revenues in excess of $5Bn. 9LAKE RESOURCES ANNUAL REPORT 202117 LAKE RESOURCES NL DIRECTORS REPORTfor the year ended30 June2021NameAmalia Saenz (appointed 28 July 2021)TitleNon-Executive DirectorExperience and expertiseMs. Amalia Sáenz is a partner at the legal firm, Zang, Bergel & Viñes, in Buenos Aires and leads the Energy and Natural Resources practice. Sra. Sáenz joined the firm some years ago to meet increased demand from clients looking to invest in Argentina’s natural resources space. Previously, Ms. Sáenz was with respected legal firm Brons & Salas, in Buenos Aires, and her practice covered the full scope of natural resources and energy and oil and gas, with specific focus on tenders, acquisitions, financing, joint venture and operation agreements in Argentina. She is a leading member of the Association of International Petroleum Negotiators. Also, in the past, Ms. Sáenz was the Legal Manager with Bridas Corporation living in Central Asia -as well in United Kingdom- experiencing working in an exploration and production operations in a context of a mixture of cultures. Other current DirectorshipsNone.Former Directorships (last 3 years)None.Notes:•Other current Directorships quoted aboveare current Directorshipsforlisted entities only and excludesDirectorshipsof allother typesof entities, unless otherwise stated.•FormerDirectorships (last 3 years)' quoted aboveareDirectorships held in the last 3 yearsforlisted entities only and excludesDirectorshipsofallother typesof entities, unless otherwise stated.CompanySecretariesThe CompanySecretary in office at the end of the financial year was Mr Garry Gill. Mr Gill is a chartered accountant with more than 30 years’ experience in all facets of corporate, financial and administrative functions, Mr Gill has served in a range of positions including as CFO, company secretary and other senior executive positions for anumber of listed and unlisted public companies. These have included serving as finance director and company secretary of Jupiters Limited, CFO/Corporate Services Manager of South Bank Corporation in Brisbane, before forming a consultancy service for smallcap ASX companies over the last decade. He has delivered improved strategic analysis and financial management, streamlined budgets, refinancing, and stakeholder management of small/mid cap resource companies. Mr Peter Neilsen who was appointed on 27 July 2021, isa chartered accountant with more than 20 years’ experience in all facetsof financial management, asset management and leadership. He has served in a range of positions including as Chief Financial Officer (CFO), company secretary, finance manager and other senior executive positions for a number of listed and unlisted companies in the energy and natural resources sector. These have included Barrick, Xstrata and Round Oak. Mr Neilsen has been involved in reducing operation expenses up to $100M through cost analysis, performance improvements and contract negotiations, acquisitions of up to $80M and managed revenues in excess of $5Bn. 9LAKE RESOURCES NL DIRECTORS REPORTfor the year ended30 June2021Mr Neilsen was appointed as Chief Financial Officer and joint Company Secretary, to drive the Kachi Project’s financing and development. This includesguiding a panel of international project financiers to successfully secure funding for Lake’s lithium production anddevelopingand assistingLake’s team in Argentina to organise development activities and lithium production. Peter replacesGarryGill, who will step down from the rolefollowinga transitional period.Directors’ Interests in the Consolidated entityAt the date of this report, theinterests of the Directors in the shares,optionsand performance rightsofthe Consolidated entitywere:Ordinary SharesOptionsPerformance RightsS Crow(Non-Executive Chairman)20,138,906613,794.00 5,000,000S Promnitz (Managing Director)11,278,3191,127,8322,500,000N Lindsay(Executive Technical Director)4,816,667650,0002,500,000R Tzrebski(Non-Executive Director)- - - A Saenz- - - Meetings of DirectorsThe number of meetings of the Consolidated entity's Board of Directors held during the year ended 30 June 2021and the number of meetings attended by each Director were:HeldAttendedS Crow1515S Promnitz 1515N Lindsay1515R Trzebski1515“Held” represents the number of meetings held during the time the Director held officeand was eligible to attend. Ms Saenz was appointed after the end of the financial yearRemuneration Report (Audited)The remuneration report outlines the Director and executive remuneration arrangements for the Consolidated entity, in accordance with the requirements of the Corporations Act 2001 and its Regulations For the purposes of this report, Key Management Personnel (KMP) are those persons having authority and responsibility for planning, directing and controlling the activities of the entity, directly or indirectly, including all Directors.The remuneration report is set out under the following main headings:•Principles used to determine the nature and amount of remuneration•Details of remuneration•Service agreements•Share-based compensation•Additional information•Additional disclosures relating to key management personnel.a)Principles used to determine the nature and amount of remunerationThe Board’s policy is to remunerate KMP at market rates for time, commitment, responsibilities,and overall performance. The Board determines payments to the KMP and reviews their remuneration annually, based on market practice,duties,and accountability. Independent external advice is sought when required. The Board aims to remunerate at a level that will attract and retain high-calibre directors, officers,and employees. KMP are remunerated to a level consistent with the sizeof the Consolidated entity. The maximum aggregate amount of Directors’ fees that can be paid is subject to approval by shareholders at 10LAKE RESOURCES ANNUAL REPORT 202118 LAKE RESOURCES NL DIRECTORS REPORTfor the year ended30 June2021the Annual General Meeting. Fees for non-executive Directors are not linked to the performance of the Consolidated entity. However, to align Directors’ interests with shareholder interests, the Directors are encouraged to hold shares in the Consolidated entity. The Consolidated entitydid not utilisethe services of a remuneration consultant for the year.The objective of the Consolidated entity's executive reward framework is to ensure reward for performance is competitive and appropriate for the results delivered. The framework aligns executive reward with the achievement of strategic objectives and the creation of value for shareholders, and it is considered to conform to the market best practice for the delivery of reward. The Board of Directors ('the Board') ensures that executive reward satisfies the following key criteria for good reward governance practices:•competitiveness and reasonableness,•acceptability to shareholders,•performance linkage/ alignment of executive compensation,•transparencyThe performance of the Consolidated entitydepends on the quality of its directorsand executives. The remuneration philosophy is to attract, motivate and retain high performance and high-quality personnel.Therewardframework is designedtoalign executive reward to shareholders' interests. The Board have considered that itshouldseek to enhance shareholders' interestsby:•having economic performance as a core component of plan design,•focusing on sustained growth in shareholder wealth, consisting of dividends and growth in share price,and delivering constant or increasing return on assets as well as focusing the executive on key non-financial drivers of value,•attracting and retaining high calibre executives.Additionally, the reward frameworkseeksto enhance executives' interestsby:•rewarding capability and experience,•reflecting competitive reward for contribution to growth in shareholder wealth,•providing a clear structure for earning rewards.Inaccordance with best practice corporate governance, the structureof non-executive director andexecutive directorremuneration is separate. Non-executive Directors’ remunerationFees and payments to non-executive directors reflect the demands and responsibilities of their role. Non-executive directors' fees and payments are reviewed annually by the Board. The Board may, from time to time, receive advice from independent remuneration consultants to ensure non-executive directors' fees and payments are appropriate and in line with the market..The current non-executive directors' fees are determined within an aggregate directors' fee limit. The maximum currentaggregate non-executive directors' fee limit stands at $350,000 per annum.Executive remunerationTheConsolidated entityaims to reward executives based on their position and responsibility, with a level and mix of remuneration which has both fixed and variable components.Theexecutive remuneration and rewardframeworkcomprises four components: •base pay and non-monetary benefits•short-term performance incentives•share-based payments•other remuneration including superannuation and long service leave.11LAKE RESOURCES ANNUAL REPORT 202119 LAKE RESOURCES NL DIRECTORS REPORTfor the year ended30 June2021the Annual General Meeting. Fees for non-executive Directors are not linked to the performance of the Consolidated entity. However, to align Directors’ interests with shareholder interests, the Directors are encouraged to hold shares in the Consolidated entity. The Consolidated entitydid not utilisethe services of a remuneration consultant for the year.The objective of the Consolidated entity's executive reward framework is to ensure reward for performance is competitive and appropriate for the results delivered. The framework aligns executive reward with the achievement of strategic objectives and the creation of value for shareholders, and it is considered to conform to the market best practice for the delivery of reward. The Board of Directors ('the Board') ensures that executive reward satisfies the following key criteria for good reward governance practices:•competitiveness and reasonableness,•acceptability to shareholders,•performance linkage/ alignment of executive compensation,•transparencyThe performance of the Consolidated entitydepends on the quality of its directorsand executives. The remuneration philosophy is to attract, motivate and retain high performance and high-quality personnel.Therewardframework is designedtoalign executive reward to shareholders' interests. The Board have considered that itshouldseek to enhance shareholders' interestsby:•having economic performance as a core component of plan design,•focusing on sustained growth in shareholder wealth, consisting of dividends and growth in share price,and delivering constant or increasing return on assets as well as focusing the executive on key non-financial drivers of value,•attracting and retaining high calibre executives.Additionally, the reward frameworkseeksto enhance executives' interestsby:•rewarding capability and experience,•reflecting competitive reward for contribution to growth in shareholder wealth,•providing a clear structure for earning rewards.Inaccordance with best practice corporate governance, the structureof non-executive director andexecutive directorremuneration is separate. Non-executive Directors’ remunerationFees and payments to non-executive directors reflect the demands and responsibilities of their role. Non-executive directors' fees and payments are reviewed annually by the Board. The Board may, from time to time, receive advice from independent remuneration consultants to ensure non-executive directors' fees and payments are appropriate and in line with the market..The current non-executive directors' fees are determined within an aggregate directors' fee limit. The maximum currentaggregate non-executive directors' fee limit stands at $350,000 per annum.Executive remunerationTheConsolidated entityaims to reward executives based on their position and responsibility, with a level and mix of remuneration which has both fixed and variable components.Theexecutive remuneration and rewardframeworkcomprises four components: •base pay and non-monetary benefits•short-term performance incentives•share-based payments•other remuneration including superannuation and long service leave.11LAKE RESOURCES NL DIRECTORS REPORTfor the year ended30 June2021Thecombinationofthesecomprisestheexecutive'stotal remuneration. Fixedremuneration,consistingof basesalary,superannuation,andnon-monetarybenefits,arereviewed annuallybytheBoardofDirectorsbasedon individualandbusinessunitperformance,theoverall performance of the Consolidated entityand comparable market remuneration.Executives may receive their fixed remuneration in the form of cash or other fringe benefits (for example motor vehicle benefits) where it does not create any additional costs to the Consolidated entityand provides additional value to the executive.Employment ConsultantDuring the year the Company engaged remuneration consultant Godfrey Remuneration Group to benchmark the board and executive salaries, to assist in developing short term and long-term incentive plans and to make recommendations regarding remuneration structures. The consultant has provided a framework for the STVR and LTVR discussed below. The cost of the project was $58,410 inclusive of GST. At the date of this report the process is incomplete.Short Term Variable Remuneration (STVR) PlanThe Consolidated entityhasundertaken to implemententitlements toparticipate in performance based STVRincentivearrangements. TheSTVR will reflect generally the following elements:•maximum entitlement of approximately 20% of Base Pay and Benefits•the package to comprise half cash and half in a grant of performance sharesThe associated performance hurdles and weighting may include:•in respect of the cash component, the delivery of a definitive feasibility study (DFS) at the Company’sKachi Lithium Brine Project (Project) and financing for the Project being approved•The hurdles and weighting for the performance shares areto be measured no later than 15 monthsafter the executive’s Commencement Date.The grant of performance shares to Executive Directorsis subject to shareholders’ approval.At the date of this report no STVR incentives have been made or proposed. Long Term Incentive (LTI) PlanAt the 2016 Annual General Meeting, the shareholders of the Consolidated entityapproved the Long-Term Incentive (LTI) Plan ('Plan'). The Plan was updated and extended at an Extraordinary General Meeting(EGM)of the Shareholders on 15 August 2019 at which approval was granted to issue up to 25,000,000 performance rights under the Plan. The main purpose of the Planis to give incentives to eligible participants (or their nominee) to provide dedicated and ongoing commitment and effort to the Consolidated entityaligning the interest of both employees and shareholders and for the Consolidated entityto reward eligibleemployees for their effort. The Plan contemplates the issue to eligible employees of performance rights which may have milestones.Mr Promnitz’ 2.5 million performance rights and MrCrow's 5 million performance rights will vestonce an investment partner signs an agreement to investin the Kachiprojectin Catamarca (Investor). Dr Lindsay’s remaining 2.5 million performance rights will vest when a Pilot Plant is established on-site at the Kachi project in Catamarca(Pilot Plant). Long Term Variable Remuneration (LTVR) PlanThe LTVR will be equal to 40% of the annual value of the executive’s Base Pay and Benefits as at the Commencement Date, comprised in performance shares granted in tranches over three years, subject to achievement of the following performance hurdles, weighted as indicated: (1)for the first tranche, measured no later than 15 months after the Commencement Date –the Company12LAKE RESOURCES ANNUAL REPORT 202120 LAKE RESOURCES NL DIRECTORS REPORTfor the year ended30 June2021putting a project team in place to build the Project DFS and building the demonstration plant on site (40%); (2)for the second tranche, measured at the end of the second year after the Commencement Date –closing the debt and equity financing for the Company’s Kachi Lithium Brine Project (Kachi Project) onterms satisfactory to the Company (40%);(3)for thethird tranche, measured at the end of the third year after the Commencement Date –theCompany receiving approval for the financing of an expansion case being up to 50,000 tonnes perannum lithium carbonate equivalent total production at the Kachi Project(20%).In each case the performance hurdles will be measured at the end of the indicated measurement periods by the Company’s Remuneration Committee who will determine the actual entitlement for the relevant measurement period. The grant of performance shares to Executive Directors is subject to shareholders’ approval.At the date of this report no LTVR incentives have been made or proposed.Voting and comments made at theConsolidated entity's2020 Annual General Meeting ('AGM')Inexcessof 75% of the votesreceived supported the adoption of the remuneration report for the year ended 30June 2020.The Consolidated entitydid notreceive anyspecific feedback regarding itsremuneration practices at the AGM.b)Detailsof remunerationAmounts of remunerationDetails of the remuneration of key management personnel of the Consolidated entityare set out in the following tables. The KMP of the Consolidated entityconsisted of the following Directors of Lake Resources NL:S Crow (Non-Executive Chairman)S Promnitz (Managing Director) N Lindsay (Non-Executive Director)R Trzebski (Non-Executive Director)And the following executive:G Gill (Chief Financial Officer and joint CompanySecretary)Key Management PersonnelDirectors’ Fees and/or SalaryConsulting Fees Annual LeaveLongService LeavePost-Employment Benefits SuperannuationShare Based Payments – Performance rights & optionsTotal$$$$$$$2021Non-Executive DirectorsS Crow140,000 74,1004----214,100 N Lindsay1120,000 16,9004----136,900 R Tzrebski61,000 ---5,792 -66,792Executive DirectorS Promnitz295,192 -65,91227,99828,043 -417,145ExecutiveG Gill172,500 -----172,500Totals788,692 91,000 65,912 27,99833,835 -1,007,437LAKE RESOURCES ANNUAL REPORT 202121 LAKE RESOURCES NL DIRECTORS REPORTfor the year ended30 June2021putting a project team in place to build the Project DFS and building the demonstration plant on site (40%); (2)for the second tranche, measured at the end of the second year after the Commencement Date –closing the debt and equity financing for the Company’s Kachi Lithium Brine Project (Kachi Project) onterms satisfactory to the Company (40%);(3)for thethird tranche, measured at the end of the third year after the Commencement Date –theCompany receiving approval for the financing of an expansion case being up to 50,000 tonnes perannum lithium carbonate equivalent total production at the Kachi Project(20%).In each case the performance hurdles will be measured at the end of the indicated measurement periods by the Company’s Remuneration Committee who will determine the actual entitlement for the relevant measurement period. The grant of performance shares to Executive Directors is subject to shareholders’ approval.At the date of this report no LTVR incentives have been made or proposed.Voting and comments made at theConsolidated entity's2020 Annual General Meeting ('AGM')Inexcessof 75% of the votesreceived supported the adoption of the remuneration report for the year ended 30June 2020.The Consolidated entitydid notreceive anyspecific feedback regarding itsremuneration practices at the AGM.b)Detailsof remunerationAmounts of remunerationDetails of the remuneration of key management personnel of the Consolidated entityare set out in the following tables. The KMP of the Consolidated entityconsisted of the following Directors of Lake Resources NL:S Crow (Non-Executive Chairman)S Promnitz (Managing Director) N Lindsay (Non-Executive Director)R Trzebski (Non-Executive Director)And the following executive:G Gill (Chief Financial Officer and joint CompanySecretary)Key Management PersonnelDirectors’ Fees and/or SalaryConsulting Fees Annual LeaveLongService LeavePost-Employment Benefits SuperannuationShare Based Payments – Performance rights & optionsTotal$$$$$$$2021Non-Executive DirectorsS Crow140,000 74,1004----214,100 N Lindsay1120,000 16,9004----136,900 R Tzrebski61,000 ---5,792 -66,792Executive DirectorS Promnitz295,192 -65,91227,99828,043 -417,145ExecutiveG Gill172,500 -----172,500Totals788,692 91,000 65,912 27,99833,835 -1,007,437LAKE RESOURCES NL DIRECTORS REPORTfor the year ended30 June2021Key Management PersonnelDirectors’ Fees and/or SalaryConsulting FeesAnnual LeaveLongService LeavePost-EmploymentBenefitsSuperannuationShare Based Payments – Performance rights and optionsTotal$$$$$$$2020Non-Executive DirectorsS Crow100,000 93,6005---176,325 369,925 N Lindsay60,000 65,0005---341,638 466,638 R Tzrebski227,823 ---2,643 -30,466Executive DirectorS Promnitz230,384 17,722-21,887312,888 582,881 ExecutiveG Gill367,500 -----67,500Totals485,707 158,600 17,722-24,530830,851 1,517,410 1NLindsay became an Executive Director on 1 January 20212Appointed 10 December 2019 3Appointed15 October 20194The remuneration for the 2021 financial year ending 30 June 2021 includes consultancy fees paid to companies associated with Stuart Crow for consultancy services in the amount of $74,100and to Lindsay Rueda Services Pty Ltd (a company associated with Dr Nicholas Lindsay) in the amount of $16,900for consulting services relating to the Kachi project prior to his appointment as technical director5the remuneration for the 2020 financial year ending 30 June 2020 includes consultancy fees paid to companies associated with Stuart Crow for consultancy services in the amount of $93,600 and to Lindsay Rueda Services Pty Ltd (a company associated with Dr Nicholas Lindsay) in the amount of $65,000 for consulting services relating to the pre-feasibility study. Percentages of remuneration that are performance based:NameFixed remunerationAt risk - STIAt risk - LTI202120202021202020212020Non-Executive DirectorsS Crow100%100%0%0%48%0%N Lindsay100%100%0%0%73%0%R Tzrebski100%n/a0%n/a0%n/aExecutive DirectorS Promnitz100%100%0%0%54%0%ExecutiveG Gill100%100%0%0%0%0%LAKE RESOURCES ANNUAL REPORT 202122 LAKE RESOURCES NL DIRECTORS REPORTfor the year ended30 June2021c)Service AgreementsRemuneration and other terms of employment for key management personnel are formalised in service agreements. Details of these agreements are as follows:Name S.PromnitzTitleManaging DirectorAgreement commenced14 November 2016Term of agreementInitial salary of $250,000 per annum, with a review point scheduled for 12 months from commencement date, subject to satisfactory performance.Effective from 1 January 2021 as an interim measure pending the negotiation of a new agreement, base salary was increased to $360,000 plus statutory superannuation. Short term and long-termvariable remuneration incentives are tobe determined in conjunction with recommendations of an external independent remuneration consultant. If termination notice given by Consolidated entity, the Consolidated entityshall be liable to pay full compensation for a six-month notice period. If notice is given by Mr Promnitz, the notice period is three months. Consolidated entityshall have the right to choose whether Mr. Promnitz work his notice or paid in lieu of noticeName N LindsayTitleExecutive Technical DirectorAgreement commenced1 January 2021Term of agreementBasis of engagement – Prior to being appointed as an executive Director Dr Lindsay (while a non-executive Director) received consulting fees for work on the Kachi project at the daily rate of $1,300 plus GST.Contract from 1January 2021 to 30 June 2021 at a contract rate of $25,000 per month plus GSTand full-timeemployee from 1 July 2021 with no fixed term assigned. Remunerationas full-time employee - Annual Base Salary of $300,000.00 per annum exclusive of statutory superannuation contributions. Short term and long-termvariable remuneration (STVR and LTVR) incentives are to be determined in conjunction with recommendations of an external independent remuneration consultant and reflect generally theelementsset out in section (a) of this report.If termination notice given by Consolidated entity, the Consolidated entity shall be liable to pay full compensation for a six-month notice period. If notice is given by Dr Lindsay, the notice period is three months. Consolidatedentity shall have the right to choose whether Dr Lindsaywork his notice or paid in lieu of noticeName G.GillTitleChief Financial Officer (until 13 July 2021) and JointCompanySecretaryAgreement commenced15 October 2019Term of agreementThe Consolidated entityhas entered into an agreement with Garry Gill and his companyto provide services as CompanySecretary and Chief Financial Officer. Services are to be provided on a part time basis and at a rate of $15,000 per LAKE RESOURCES ANNUAL REPORT 202123 LAKE RESOURCES NL DIRECTORS REPORTfor the year ended30 June2021c)Service AgreementsRemuneration and other terms of employment for key management personnel are formalised in service agreements. Details of these agreements are as follows:Name S.PromnitzTitleManaging DirectorAgreement commenced14 November 2016Term of agreementInitial salary of $250,000 per annum, with a review point scheduled for 12 months from commencement date, subject to satisfactory performance.Effective from 1 January 2021 as an interim measure pending the negotiation of a new agreement, base salary was increased to $360,000 plus statutory superannuation. Short term and long-termvariable remuneration incentives are tobe determined in conjunction with recommendations of an external independent remuneration consultant. If termination notice given by Consolidated entity, the Consolidated entityshall be liable to pay full compensation for a six-month notice period. If notice is given by Mr Promnitz, the notice period is three months. Consolidated entityshall have the right to choose whether Mr. Promnitz work his notice or paid in lieu of noticeName N LindsayTitleExecutive Technical DirectorAgreement commenced1 January 2021Term of agreementBasis of engagement – Prior to being appointed as an executive Director Dr Lindsay (while a non-executive Director) received consulting fees for work on the Kachi project at the daily rate of $1,300 plus GST.Contract from 1January 2021 to 30 June 2021 at a contract rate of $25,000 per month plus GSTand full-timeemployee from 1 July 2021 with no fixed term assigned. Remunerationas full-time employee - Annual Base Salary of $300,000.00 per annum exclusive of statutory superannuation contributions. Short term and long-termvariable remuneration (STVR and LTVR) incentives are to be determined in conjunction with recommendations of an external independent remuneration consultant and reflect generally theelementsset out in section (a) of this report.If termination notice given by Consolidated entity, the Consolidated entity shall be liable to pay full compensation for a six-month notice period. If notice is given by Dr Lindsay, the notice period is three months. Consolidatedentity shall have the right to choose whether Dr Lindsaywork his notice or paid in lieu of noticeName G.GillTitleChief Financial Officer (until 13 July 2021) and JointCompanySecretaryAgreement commenced15 October 2019Term of agreementThe Consolidated entityhas entered into an agreement with Garry Gill and his companyto provide services as CompanySecretary and Chief Financial Officer. Services are to be provided on a part time basis and at a rate of $15,000 per LAKE RESOURCES NL DIRECTORS REPORTfor the year ended30 June2021month plus GST plus expenses which may be amended as required. On 27 July the Company announced that Mr Peter Neilsen would replace Mr Gill as CFO and CompanySecretary and that Mr Gill would continue for a transitionary period. Name P NeilsenTitleChief Financial Officer (from13 July 2021) and JointCompany SecretaryAgreement commenced13 July 2021Term of agreementTerm - 3 years from date of appointmentRemuneration: $330,000 inclusive of statutory superannuationSign on bonus – 2 million options with exercise price of 50% greater that market price at commencement date and expiry of 3 years from commencement date.Entitlement to participate in the performance based short term and long term variable remuneration plansKey management personnel have no entitlement to termination payments in the event of removal for misconductNon-executive director arrangementsNon-executive directors enter into an agreement with the Consolidated entityin the form of a letter of appointment. The letter summarises theboard policies andterms, including remuneration, relevant to the office of directorand for any additional services provided. Two non-executive Directors,Mr Crow and Dr Lindsay (Dr Lindsay wasappointed as an executive Director on 1 January 2021) received consulting fees of $1,300 per day plus GST for services provided to the Company.d)Share-based compensationIssue of sharesDuring the year 5,000,000 shares were issued to Directors following the vesting of Performance rights during the previous financial year. The performance rights which were granted to Mr Promnitz and Dr Lindsayon 15 August 2019 vested on 30 April 2020 and the fully paid ordinary shares were issued on 31 August 2020.NameNumber of Rights vestedGrant dateExpiry dateFair value at grant dateShares issued during the year S.Promnitz2,500,000 15-Aug-1915-Aug-24$0.05752,500,000N.Lindsay5,000,000 15-Aug-1915-Aug-24$0.05752,500,000Total15,000,000 15-Aug-1915-Aug-24$0.05755,000,000OptionsThe terms and conditions of each grant of options over ordinary shares affecting remuneration of directors and other key management personnel in this financial year, prioror future reporting years are as follows:Grant DateVesting and exercisable dateExpiry dateExercise PriceFair value at grant dateVestedExpired / Exercised30-Nov-2017*30-Nov-201731-Dec-2020$0.28$0.140100%100%15-Aug-201915-Aug-201931-July-2021$0.09$0.032100%100%*The options expired unexercised.16LAKE RESOURCES ANNUAL REPORT 202124 LAKE RESOURCES NL DIRECTORS REPORTfor the year ended30 June2021On 15 August 2019, 15,000,000 options over ordinary shares were issued to Directors following approval at the shareholder meeting of 15 August 2019. The terms and conditions of each grant of options over ordinary shares affecting remuneration of directors and other key management personnel in this financial year or future reporting years are as follows:NameNumber of Options grantedGrant dateVesting and exercisable dateExpiry dateExercise PriceFair value at grant dateS.Crow5,000,00015-Aug-1915-Aug-1931-Jul-21$0.09$0.032S.Promnitz5,000,00015-Aug-1915-Aug-1931-Jul-21$0.09$0.032N.Lindsay5,000,00015-Aug-1915-Aug-1931-Jul-21$0.09$0.032Total 15,000,00015-Aug-1915-Aug-1931-Jul-21$0.09$0.032Of the 15,000,000 options on issueat the exercise date, 14,000,000 were exercised by the expiry date.Performance RightsThe terms and conditions of performance rights affecting remuneration of directors and other key management personnel in this financial year or future reporting years are as follows:Grant DateExpiry dateValue at GrantNo of RightsPerformance HurdlePerformance achievedNo.vestedand exercised15-Aug-201915-Aug-24$0.05755,000,000PFS100%5,000,000 15-Aug-201915-Aug-24$0.05752,500,000Pilot plant-%-15-Aug-201915-Aug-24$0.05757,500,000Investor-%-Total15,000,0005,000,000 On 15 August 2019,15,000,000 Performance rights were issued to Directors following approval at the shareholder meeting of 15 August 2019. Of the performance rights granted to Mr Promnitz and Dr Lindsay 5 million rights vested on 30 April 2020 and were issued on 31 August 2020.NameNumber of Rights grantedGrant dateExpiry dateFair value at grant dateExercised duringthe yearS.Promnitz5,000,000 15-Aug-1915-Aug-24$0.05752,500,000S.Crow5,000,000 15-Aug-1915-Aug-24$0.0575-N.Lindsay5,000,000 15-Aug-1915-Aug-24$0.05752,500,000Total15,000,000 15-Aug-1915-Aug-24$0.05755,000,000Performance rights issued as part of remuneration were issued following shareholder approval at a meeting held on 15 August 2019. On 30 April 2020, 2,500,000 rights granted to each of Mr Promnitzand Dr Lindsay vested following the completion and announcement of the pre-feasibility study. The shares were issued on 31 August 2020. e)Link between remuneration and performanceDuring the year, the Consolidated entity has generated losses from its principal activity of exploring and developing its suite of lithium projects. As the Consolidated entity is still growing the business, the link LAKE RESOURCES ANNUAL REPORT 202125 LAKE RESOURCES NL DIRECTORS REPORTfor the year ended30 June2021On 15 August 2019, 15,000,000 options over ordinary shares were issued to Directors following approval at the shareholder meeting of 15 August 2019. The terms and conditions of each grant of options over ordinary shares affecting remuneration of directors and other key management personnel in this financial year or future reporting years are as follows:NameNumber of Options grantedGrant dateVesting and exercisable dateExpiry dateExercise PriceFair value at grant dateS.Crow5,000,00015-Aug-1915-Aug-1931-Jul-21$0.09$0.032S.Promnitz5,000,00015-Aug-1915-Aug-1931-Jul-21$0.09$0.032N.Lindsay5,000,00015-Aug-1915-Aug-1931-Jul-21$0.09$0.032Total 15,000,00015-Aug-1915-Aug-1931-Jul-21$0.09$0.032Of the 15,000,000 options on issueat the exercise date, 14,000,000 were exercised by the expiry date.Performance RightsThe terms and conditions of performance rights affecting remuneration of directors and other key management personnel in this financial year or future reporting years are as follows:Grant DateExpiry dateValue at GrantNo of RightsPerformance HurdlePerformance achievedNo.vestedand exercised15-Aug-201915-Aug-24$0.05755,000,000PFS100%5,000,000 15-Aug-201915-Aug-24$0.05752,500,000Pilot plant-%-15-Aug-201915-Aug-24$0.05757,500,000Investor-%-Total15,000,0005,000,000 On 15 August 2019,15,000,000 Performance rights were issued to Directors following approval at the shareholder meeting of 15 August 2019. Of the performance rights granted to Mr Promnitz and Dr Lindsay 5 million rights vested on 30 April 2020 and were issued on 31 August 2020.NameNumber of Rights grantedGrant dateExpiry dateFair value at grant dateExercised duringthe yearS.Promnitz5,000,000 15-Aug-1915-Aug-24$0.05752,500,000S.Crow5,000,000 15-Aug-1915-Aug-24$0.0575-N.Lindsay5,000,000 15-Aug-1915-Aug-24$0.05752,500,000Total15,000,000 15-Aug-1915-Aug-24$0.05755,000,000Performance rights issued as part of remuneration were issued following shareholder approval at a meeting held on 15 August 2019. On 30 April 2020, 2,500,000 rights granted to each of Mr Promnitzand Dr Lindsay vested following the completion and announcement of the pre-feasibility study. The shares were issued on 31 August 2020. e)Link between remuneration and performanceDuring the year, the Consolidated entity has generated losses from its principal activity of exploring and developing its suite of lithium projects. As the Consolidated entity is still growing the business, the link LAKE RESOURCES NL DIRECTORS REPORTfor the year ended30 June2021between remuneration, performance and shareholder wealth is difficult to define. Share prices are subject to the influence of fluctuation in the world market price for lithium and general market sentiment towards the sector, and, as such, increases or decreases may occur quite independently of Executive performance. Given the nature of the Consolidated entity’s activities and the consequential operating results, no dividends have been paid. There have been no returns of capital in the current or previous financial periods.The earnings of the Consolidated entityfor the five years to 30 June 2021and share price as at each year end are summarised below:20212020201920182017$$$$$Net Loss3,119,3754,760,4404,760,140 3,540,391 1,170,745 Net Assets46,871,271 17,049,287 12,913,063 6,505,140 3,228,950 Share Price at year end (cents)33.53.5993f)Additionaldisclosures relatingto key managementpersonnelShareholdingMovements in the number of shares in theConsolidated entity held during the financial year by each director and other membersof key managementpersonnelof the Consolidated entity, including their personally related parties,areset out below: Balance at start of yearReceived as part of remunerationAdditionsDisposals / OtherBalance at end of yearS.Crow10,104,131 -6,237,648-16,341,779S Promnitz14,131,293 2,500,000 7,447,661 (12,800,635)11,278,319N Lindsay-2,500,000 4,000,000-6,500,000R Tzrebski-----G Gill--36,416 -36,416Total24,235,424 5,000,000 17,721,725 (12,800,635)34,156,514OptionsMovements in the number of options overordinaryshares in theConsolidated entity held duringthe financial yearby each director and othermembersof key management personnel of theConsolidated entity, including their personally related parties,are set out below: Balance at start of yearGranted as remunerationExercisedListed options ReceivedExpired / forfeitBalance at end of yearS.Crow9,260,197-(6,260,197)-(3,000,000)-S Promnitz12,447,661-(7,447,661)-(5,000,000)-N Lindsay6,500,000-(4,000,000)-(2,500,000)-R Tzrebski------G Gill------Total28,207,858-(17,707,858)-(10,500.000)-LAKE RESOURCES ANNUAL REPORT 202126 LAKE RESOURCES NL DIRECTORS REPORTfor the year ended30 June2021Performance rightsMovements in the number of performance rights over ordinary shares in the Consolidated entityheld during the financial year by each director and other members of key management personnel of the Consolidated entity,including their personally related parties, are set out below.Balance at start of yearGranted as remunerationConverted to sharesExpired Balance at end of yearS.Crow5,000,000 ---5,000,000 S Promnitz5,000,000-(2,500,000)-2,500,000N Lindsay5,000,000 -(2,500,000)-2,500,000RTzrebski-----G Gill----- --(5,000,000)-10,000,000Performance rights issued as part of remuneration were issued following shareholder approval at a meeting held on 15 August 2019. On 30 April 2020, 2,500,000 rights granted to each of Mr Promnitz,and Dr Lindsay vested following the completion and announcement of the pre-feasibility study. The shares were issued on 31 August 2020. End of Audited Remuneration ReportShare OptionsShares under optionUnissued ordinary shares of Lake Resources NL under option at the date of this report are as follows:Grant DateExpiry dateExercise priceNumber under option09-March-202109-March-2023$0.3017,339,37509-March-202109-March-2023$0.3011,250,000 27-January-202127-January-2023$0.301,000,000 24-May-202112-July-2024$0.301,500,000 12-July-202112-July-2024$0.552,000,000 01-August-202101-August-2024$0.495,780,000 30-August-202115-June-2022$0.754,000,000 28-July-202131-December-2024$0.5535,000,000 30-August-202115-October-2021$0.3526,511,88330-August-202115-June-2022$0.7583,904,236Total188,285,494Each option is convertible to one ordinary share. Option holders do not have the right to participate in any other share issue of the Consolidated entityor of any other entity.For details of options issued to directors and other key management personnel as remuneration, refer to the remuneration report.Shares issued on exercise of optionsDuring or since the end of the financial year, the Consolidated entityissued ordinary shares of the Consolidated entityas a result of the exercise of options as follows (there are no amounts unpaid on the shares issued).LAKE RESOURCES ANNUAL REPORT 202127 LAKE RESOURCES NL DIRECTORS REPORTfor the year ended30 June2021Performance rightsMovements in the number of performance rights over ordinary shares in the Consolidated entityheld during the financial year by each director and other members of key management personnel of the Consolidated entity,including their personally related parties, are set out below.Balance at start of yearGranted as remunerationConverted to sharesExpired Balance at end of yearS.Crow5,000,000 ---5,000,000 S Promnitz5,000,000-(2,500,000)-2,500,000N Lindsay5,000,000 -(2,500,000)-2,500,000RTzrebski-----G Gill----- --(5,000,000)-10,000,000Performance rights issued as part of remuneration were issued following shareholder approval at a meeting held on 15 August 2019. On 30 April 2020, 2,500,000 rights granted to each of Mr Promnitz,and Dr Lindsay vested following the completion and announcement of the pre-feasibility study. The shares were issued on 31 August 2020. End of Audited Remuneration ReportShare OptionsShares under optionUnissued ordinary shares of Lake Resources NL under option at the date of this report are as follows:Grant DateExpiry dateExercise priceNumber under option09-March-202109-March-2023$0.3017,339,37509-March-202109-March-2023$0.3011,250,000 27-January-202127-January-2023$0.301,000,000 24-May-202112-July-2024$0.301,500,000 12-July-202112-July-2024$0.552,000,000 01-August-202101-August-2024$0.495,780,000 30-August-202115-June-2022$0.754,000,000 28-July-202131-December-2024$0.5535,000,000 30-August-202115-October-2021$0.3526,511,88330-August-202115-June-2022$0.7583,904,236Total188,285,494Each option is convertible to one ordinary share. Option holders do not have the right to participate in any other share issue of the Consolidated entityor of any other entity.For details of options issued to directors and other key management personnel as remuneration, refer to the remuneration report.Shares issued on exercise of optionsDuring or since the end of the financial year, the Consolidated entityissued ordinary shares of the Consolidated entityas a result of the exercise of options as follows (there are no amounts unpaid on the shares issued).LAKE RESOURCES NL DIRECTORS REPORTfor the year ended30 June2021Date options grantedExpiry dateExercise priceNumber of shares issued08-March-201928-February-2022$0.085,555,000 19-August-201915-June-2021$0.1051,332,803 16-September-201931-July-2021$0.0914,000,000 28-October-201928-October-2022$0.0518,300,000 09-March-202109-March-2023$0.3040,880,62530-August-202115-October-2021$0.3583,904,236 Total166,505,335Performance RightsAt the date of this report there were 10,000,000 unissued ordinary shares of Lake Resources NL under performance rights (10,000,000 at 30 June 2021and 15,000,000at 30 June 2020). During the financial year ended 30 June 2021, 5,000,000 performance shares were issued to Directors. These performance rights were granted on 15 August 2019 following approval at a meeting of Shareholders. No performance shares have been issued since 30 June 2021. Information on the issue of performance shares to Directors is provided in the remuneration report above.Indemnity and insurance of officersThe Consolidated entityhas indemnified the directors and executives of the Consolidated entityfor costs incurred, in their capacity as a director or executive, for which they may be held personally liable,except where there is a lack of good faith.During the financial year, the Consolidated entitypaid a premium in respect of a contract to insure the directors and executives of the Consolidated entityagainst a liability to the extent permitted by the Corporations Act 2001. The contract of insurance prohibits disclosure of the nature of the liability and the amount of the premium.Indemnity and insurance of auditorThe Consolidated entityhas not, during or since the end of the financial year, indemnified or agreed to indemnify the auditor of the Consolidated entityor any related entity against a liability incurred by the auditor.During the financial year, the Consolidated entityhas not paid a premium in respect of a contract to insure the auditor of theConsolidated entityor any related entity.Proceedings on behalf of the Consolidated entityNo person has applied to the Court under section 237 of the Corporations Act 2001 for leave to bring proceedings on behalf of the Consolidated entity, or to intervene in any proceedings to which the Consolidated entityis a party for the purpose of taking responsibility on behalf of the Consolidated entityfor all or part of those proceedings.Non-audit servicesThere were no non-audit services provided during the financial year by the auditor.Officers of the Consolidated entitywho are former partners of BDOAudit Pty LtdThere are no officers of the Consolidated entitywho are former partners of BDOAudit Pty Ltd.Auditor's independence declarationA copy of the auditor's independence declaration as required under section 307C of the Corporations Act 2001 is set out immediately after this directors' report.LAKE RESOURCES ANNUAL REPORT 202128 LAKE RESOURCES NL DIRECTORS REPORTfor the year ended30 June2021AuditorBDOAuditPty Ltdcontinuesin office in accordance withsection 327 of the CorporationsAct 2001.Thisreport ismadeinaccordancewitha resolutionofdirectors,pursuanttosection298(2)(a)oftheCorporations Act 2001.On behalf of the directorsSteve Promnitz Managing Director29October 2021LAKE RESOURCES ANNUAL REPORT 202129 LAKE RESOURCES NL DIRECTORS REPORTfor the year ended30 June2021AuditorBDOAuditPty Ltdcontinuesin office in accordance withsection 327 of the CorporationsAct 2001.Thisreport ismadeinaccordancewitha resolutionofdirectors,pursuanttosection298(2)(a)oftheCorporations Act 2001.On behalf of the directorsSteve Promnitz Managing Director29October 2021BDO Audit Pty Ltd ABN 33 134 022 870 is a member of a national association of independent entities which are all members of BDO Australia Ltd ABN 77 050 110 275, an Australian company limited by guarantee. BDO Audit Pty Ltd and BDO Australia Ltd are members of BDO International Ltd, a UK company limited by guarantee, and form part of the international BDO network of independent member firms. Liability limited by a scheme approved under Professional Standards Legislation. Tel: +61 7 3237 5999 Fax: +61 7 3221 9227 www.bdo.com.au Level 10, 12 Creek St Brisbane QLD 4000 GPO Box 457 Brisbane QLD 4001 Australia DECLARATION OF INDEPENDENCE BY R M SWABY TO THE DIRECTORS OF LAKE RESOURCES NL As lead auditor of Lake Resources NL for the year ended 30 June 2021, I declare that, to the best of my knowledge and belief, there have been: 1.No contraventions of the auditor independence requirements of the Corporations Act 2001 inrelation to the audit; and2.No contraventions of any applicable code of professional conduct in relation to the audit.This declaration is in respect of Lake Resources NL and the entities it controlled during the period. R M Swaby Director Brisbane, 29 October 2021 LAKE RESOURCES NLAUDITOR'S INDEPENDENCE DECLARATIONfor the year ended30 June2021LAKE RESOURCES ANNUAL REPORT 202130 FINANCIAL STATEMENTSfor the year ended 30 June 2021General informationThe financial statements cover Lake ResourcesNLas a Consolidated entity consistingof Lake ResourcesNLand the entitiesit controlledat the end of, or during, the year. The financial statementsare presented in Australian dollars, which is LakeResourcesNL's functional and presentationcurrency. Lake Resources NL is a listed public Company limited by shares, incorporated, and domiciled in Australia.Itsregistered officeand principal place of business is: Level 5, 126 Phillip StreetSYDNEY NSW 2000LAKE RESOURCES ANNUAL REPORT 202131 LAKE RESOURCES NLConsolidated statement of profit or loss and other comprehensive incomefor the year ended 30 June 2021ConsolidatedNote20212020$$ExpensesDepreciation and amortisation expense(337)(881)Administrative expenses(234,450)(125,080)Corporate expenses(1,269,593)(1,362,705)Employee benefit expenses(727,810)(519,818)Share based payments expense27(108,931)(1,850,492)Consultancy and legal costs(550,873)(548,002)Exploration expenditure impaired10(301,700)-Foreign exchange gains and losses4299,471 13,887Non recoverable VAT-(44,021)Finance costs-(465,783)Loss before income tax expense4(2,894,223)(4,902,896)Income tax expense5--Loss after income tax expense for the year attributable to the owners of Lake Resources NL16(2,894,223)(4,902,896)Other comprehensive income for the year, net of tax(225,152)142,756Total comprehensive income for the year attributable to the owners of Lake Resources NL (3,119,375)(4,760,140)CentsCentsBasicearningspershare26(0.35)(0.87)Dilutedearningspershare26(0.35)(0.87)The aboveconsolidated statement of profit or loss and other comprehensive income should be read in conjunction with theaccompanying notesLAKE RESOURCES ANNUAL REPORT 202132 LAKE RESOURCES NLConsolidated statement of Financial PositionAs at 30 June 2021ConsolidatedNote20212020$$AssetsCurrent assetsCash and cash equivalents625,657,074 55,511 Other receivables7278,079 304,841 Other current assets8166,996-Total current assets26,102,149360,352Non-current assetsInvestments accounted for using the equity method-34Property, plant and equipment979,941 532Exploration and evaluationassets1021,736,85417,352,504 Total non-current assets21,816,79517,353,070Total assets47,918,944 17,713,422 LiabilitiesCurrent liabilitiesTrade and other payables11790,551 583,027 Borrowings12- -Employee benefits13229,124 81,108 Total current liabilities1,019,675 664,135 Non-current liabilitiesEmployee benefits1327,998-Total non- current liabilities27,998- Total liabilities1,047,673 664,135 Net assets46,871,271 17,049,287 EquityIssued capital1465,748,642 35,433,060 Reserves153,364,591 3,343,899 Accumulated losses16(22,241,962)(21,727,672)Total equity46,871,271 17,049,287 The above consolidated statement of financial position should be read in conjunction with the accompanyingnotesLAKE RESOURCES ANNUAL REPORT 202133 LAKE RESOURCES NLConsolidated statement of Financial PositionAs at 30 June 2021ConsolidatedNote20212020$$AssetsCurrent assetsCash and cash equivalents625,657,074 55,511 Other receivables7278,079 304,841 Other current assets8166,996-Total current assets26,102,149360,352Non-current assetsInvestments accounted for using the equity method-34Property, plant and equipment979,941 532Exploration and evaluationassets1021,736,85417,352,504 Total non-current assets21,816,79517,353,070Total assets47,918,944 17,713,422 LiabilitiesCurrent liabilitiesTrade and other payables11790,551 583,027 Borrowings12- -Employee benefits13229,124 81,108 Total current liabilities1,019,675 664,135 Non-current liabilitiesEmployee benefits1327,998-Total non- current liabilities27,998- Total liabilities1,047,673 664,135 Net assets46,871,271 17,049,287 EquityIssued capital1465,748,642 35,433,060 Reserves153,364,591 3,343,899 Accumulated losses16(22,241,962)(21,727,672)Total equity46,871,271 17,049,287 The above consolidated statement of financial position should be read in conjunction with the accompanyingnotesLAKE RESOURCES NLConsolidated statement of Changes in Equityfor the year ended 30 June 2021NoteIssued CapitalReservesAccumulated LossesTotal Equity$$$$35,433,060 3,343,899 (21,727,672)17,049,287 --(2,894,223)(2,894,223)-(225,152)-(225,152)-(225,152)(2,894,223)(3,119,375)1430,206,651 --30,206,65114108,931 --108.931-2,625,776-2,625,77615-(2,379,932)2,379,932 -65,748,642 3,364,591(22,241,962)46,871,27127,758,605 1,979,234 (16,824,776)12,913,063 --(4,902,896)(4,902,896)-142,756-142,756-142,756(4,902,896)(4,760,140)6,032,043 --6,032,043 1,743 --1,743 549,764 - -549,764 462,321 - -462,321 -391,058-391,058628,584 --628,584-485,851-485,851-345,000-345,000Balance at 1July 2020Loss after income taxexpense for the yearOther comprehensiveincomefor the year, netof taxTotal comprehensiveincome for the yearTransactions with owners in their capacity as ownersContributions of equity, net of transactioncostsShare based paymentsIssueof unlisted options to brokersTransfer from option reserve to accumulated losseson options expired/ exercisedBalance at 30 June 2021 Balanceat 1July 2019Loss after income taxexpense for the yearOther comprehensiveincomefor the year, netof taxTotal comprehensiveincome for the yearTransactions with owners in their capacity as ownersContributions of equity, net of transactioncosts Issueof share capital on conversionof optionsIssue ofsharecapital on conversionof convertiblenotesIssueof share capital on close out of convertiblenotesIssue ofunlistedoptions to financier SBIShare based paymentsIssue ofoptions toDirectorsIssueof performance rights toDirectorsBalance at 30 June 2020 35,433,060 3,343,899 (21,727,672)17,049,287 The above consolidated statement ofchanges in equityshould be read in conjunction with theaccompanyingnotesLAKE RESOURCES ANNUAL REPORT 202134 LAKE RESOURCES NLConsolidated statement of cash flowsfor the year ended 30 June 2021Consolidated20212020$$Cash flows from operating activitiesPayments to suppliers(2,432,982)(2,488,298)Net cash used in operating activities25(2,432,982)(2,488,298)Cash flows from investing activitiesPayments for property, plant and equipment(79,746)-Payments for exploration and evaluation(4,718,136)(4,220,576)Net cash used in investing activities(4,797,882)(4,220,576)Cash flows from financing activitiesProceeds from issue of shares, net of transaction costs1432,799,927 6,129,377 Proceeds from borrowings12200,000 2,270,000 Repayment of borrowings(refer Note 12)12(167,500)(2,894,575)Payment of interest and fees on borrowings-(465,783)Net cash from financing activities32,832,4275,039,020 Net increase/(decrease) in cash and cash equivalents25,601,563(1,669,855)Cash and cash equivalents at the beginning of the financial year55,511 1,725,366 Cash and cash equivalents at the end of the financial year625,657,07455,511 The above consolidated statement of cash flows should be read in conjunction with the accompanyingnotes27LAKE RESOURCES ANNUAL REPORT 202135 LAKE RESOURCES NLConsolidated statement of cash flowsfor the year ended 30 June 2021Consolidated20212020$$Cash flows from operating activitiesPayments to suppliers(2,432,982)(2,488,298)Net cash used in operating activities25(2,432,982)(2,488,298)Cash flows from investing activitiesPayments for property, plant and equipment(79,746)-Payments for exploration and evaluation(4,718,136)(4,220,576)Net cash used in investing activities(4,797,882)(4,220,576)Cash flows from financing activitiesProceeds from issue of shares, net of transaction costs1432,799,927 6,129,377 Proceeds from borrowings12200,000 2,270,000 Repayment of borrowings(refer Note 12)12(167,500)(2,894,575)Payment of interest and fees on borrowings-(465,783)Net cash from financing activities32,832,4275,039,020 Net increase/(decrease) in cash and cash equivalents25,601,563(1,669,855)Cash and cash equivalents at the beginning of the financial year55,511 1,725,366 Cash and cash equivalents at the end of the financial year625,657,07455,511 The above consolidated statement of cash flows should be read in conjunction with the accompanyingnotes27LAKE RESOURCES NLNotes to the financial statementsfor the year ended 30 June 2021Note 1. Significant accounting policiesTheprincipal accounting policies adopted in the preparation of the financial statements are set out below.These policieshave been consistently applied to all theyearspresented, unless otherwise stated. i.Basis of preparationThese general-purpose financial statements have beenprepared in accordance with Australian Accounting Standards andInterpretations issued by the Australian Accounting Standards Board('AASB') and the Corporations Act 2001,as appropriatefor for-profit oriented entities.These financial statements also comply with International Financial Reporting Standardsasissued by the International Accounting Standards Board ('IASB'). Historical cost conventionThefinancial statements have been prepared under the historical costconvention. Critical accounting estimatesThepreparationof the financial statementsrequirestheuseof certain critical accountingestimates. It also requiresmanagementtoexercise its judgement in the processof applyingtheConsolidated entity'saccounting policies.Theareasinvolving a higher degreeof judgementor complexity, orareaswhereassumptions andestimatesaresignificant to thefinancial statements, aredisclosed in note 2. ii.Newor amended Accounting Standards and Interpretations adoptedTheConsolidated entity has adopted allof the new or amended Accounting Standards and Interpretations issued bytheAustralian Accounting Standards Board('AASB') that are mandatory for the current reportingperiod. Anynew or amendedAccounting Standardsor Interpretations that are not yet mandatory have not been early adopted. The adoptionof these Accounting Standards and Interpretations did not have any significant impact on the financial performance or position of theConsolidated entity. iii.Impact of Coronavirus (COVID-19)BackgroundThe spread of novel coronavirus (COVID-19), a respiratory illness caused by a new virus, was declared a public health emergency by the World Health Organisation in January 2020and upgraded to a global pandemic in March 2020.This pandemic has severely impacted many local economies around the globe. In many countries, businesses are being forced to cease or limit operations for long or indefinite periods of time. Measures taken to contain the spread of the virus, including travel bans, quarantines, social distancing, and closures of non-essential services have triggered significant disruptions to businesses worldwide, resulting in an economic slowdown. Global stock markets have also experienced great volatility and a significantweakening.Governments and central banks have responded with monetary and fiscal interventions to stabilise economic conditions.The Consolidated entityhas considered the effects of these events based on the information at the date of issuing this financial report and potential effects of business and other market volatility in preparing its financial statements. Impact and considerations for the financial statements / report of the Consolidated entityJudgement has been exercised in considering the impacts that the Coronavirus (COVID-19) pandemic has had, or may have, on the consolidated entity based on known information.The Consolidated entityhas determined that its financial position and performance will not be significantly or materially impacted by COVID-19 when considering the nature of the Company’soperations, supplier base, and levels of activity to date. In particular, the Directors haveassessed the potential impact on 28LAKE RESOURCES ANNUAL REPORT 202136 LAKE RESOURCES NLNotes to the financial statementsfor the year ended 30 June 2021•the Consolidated entity’s ability to raise capital and loan funds.•conducting day to day exploration and development activities at itsflagship Kachi Lithium Brine Project inCatamarca Provinceand its Cauchari Lithium Brine Project in Jujuy Provinceand•the activities of the Consolidated entity’s technology partner, Lilac Solutions Inc(Lilac), in California.The Consolidated entitywas successful in raising$20.6million ofequity in February 2021and experienced strong levels of exercise of its listed options in June 2021 and its unlisted options from 30 June 2021 through to the date of this report, raising an additional $42,890,670.The Consolidated entityannounced the receipt of formal expressions of interest from UK Export Financeand Canada’s Export Credit Agency to work with the Consolidated entity to provide the project finance for the development at approximately 70% of the project cost. On 22 September 2021, the Consolidated entityannounced to the ASX it had entered into a partnership with Lilac Solutions Inc to provide technology and funding to develop Lake’s Kachi Lithium Brine Project. Given the dynamic and evolving nature of COVID-19, limited recent experience of the economic and financial impacts of such a pandemic, it is not practicable to estimate the potential impact, positive or negative, after the reporting date. The situation is rapidly developing and is dependent on measures imposed by the Australian Government, the Argentine Government, and other countries, such as maintaining social distancing requirements, quarantine, travel restrictions and any economic stimulus that may be provided.The Company will continue to monitor events as they occur to ensure that the potential impacts of the pandemic are minimised whilst ensuring safe working conditions for staff and contractors. Other than adjusting events that provide evidence of conditions that existed at the end of the reporting period, the impact of events that arise after the reporting period will be accounted for in future reporting periods.iv.Going concernThe financial report has been prepared on a going concern basis, which assumes continuity of normal business activities and the realisation of assets and the settlement of liabilities in the ordinary course of business. The Consolidated entityhas incurred net losses after tax of $3,119,375and net cash outflows from operating and investing activities of $7,230,865for the year ended 30 June 2021. At 30 June 2021, the Company had net current assetsof $26,027,044.The Directors note the following with regards to the ability of the Consolidated entity to continue as a going concern: a.Subsequent to the end of the financial year, the Consolidated entity issued138,784,861.00 shares toraise $42,890,670 before costs.b.The Directors expect that while current funds would be sufficient to meet a minimum program ofexploration and development, an expanded program would require additional funds. The Consolidatedentity has previously raised funds through share placements, short term loans and capital raisings fromnew and existing shareholders.c.In addition to the above, the Directors have been reviewing various funding opportunitiesfor an expandedprogram and are in advanceddiscussions with potential cornerstone investors, other investors anddevelopment funding partners to meet ongoing needs and to position the Consolidated entity to securefunding for the first phase of potential staged production.d.The Directors have the ability to schedule activities and hence expenditure in accordance with theavailability of funds and their cash forecasts.Based on thesuccess in raising capitalpost year end as outlined above,the Directors are confident,that the Consolidated entity is well funded for the current planned works and for at least the next twelve months from the date of this report, and that the going concern basis of preparation for the financial report is appropriate.29LAKE RESOURCES ANNUAL REPORT 202137 LAKE RESOURCES NLNotes to the financial statementsfor the year ended 30 June 2021•the Consolidated entity’s ability to raise capital and loan funds.•conducting day to day exploration and development activities at itsflagship Kachi Lithium Brine Project inCatamarca Provinceand its Cauchari Lithium Brine Project in Jujuy Provinceand•the activities of the Consolidated entity’s technology partner, Lilac Solutions Inc(Lilac), in California.The Consolidated entitywas successful in raising$20.6million ofequity in February 2021and experienced strong levels of exercise of its listed options in June 2021 and its unlisted options from 30 June 2021 through to the date of this report, raising an additional $42,890,670.The Consolidated entityannounced the receipt of formal expressions of interest from UK Export Financeand Canada’s Export Credit Agency to work with the Consolidated entity to provide the project finance for the development at approximately 70% of the project cost. On 22 September 2021, the Consolidated entityannounced to the ASX it had entered into a partnership with Lilac Solutions Inc to provide technology and funding to develop Lake’s Kachi Lithium Brine Project. Given the dynamic and evolving nature of COVID-19, limited recent experience of the economic and financial impacts of such a pandemic, it is not practicable to estimate the potential impact, positive or negative, after the reporting date. The situation is rapidly developing and is dependent on measures imposed by the Australian Government, the Argentine Government, and other countries, such as maintaining social distancing requirements, quarantine, travel restrictions and any economic stimulus that may be provided.The Company will continue to monitor events as they occur to ensure that the potential impacts of the pandemic are minimised whilst ensuring safe working conditions for staff and contractors. Other than adjusting events that provide evidence of conditions that existed at the end of the reporting period, the impact of events that arise after the reporting period will be accounted for in future reporting periods.iv.Going concernThe financial report has been prepared on a going concern basis, which assumes continuity of normal business activities and the realisation of assets and the settlement of liabilities in the ordinary course of business. The Consolidated entityhas incurred net losses after tax of $3,119,375and net cash outflows from operating and investing activities of $7,230,865for the year ended 30 June 2021. At 30 June 2021, the Company had net current assetsof $26,027,044.The Directors note the following with regards to the ability of the Consolidated entity to continue as a going concern: a.Subsequent to the end of the financial year, the Consolidated entity issued138,784,861.00 shares toraise $42,890,670 before costs.b.The Directors expect that while current funds would be sufficient to meet a minimum program ofexploration and development, an expanded program would require additional funds. The Consolidatedentity has previously raised funds through share placements, short term loans and capital raisings fromnew and existing shareholders.c.In addition to the above, the Directors have been reviewing various funding opportunitiesfor an expandedprogram and are in advanceddiscussions with potential cornerstone investors, other investors anddevelopment funding partners to meet ongoing needs and to position the Consolidated entity to securefunding for the first phase of potential staged production.d.The Directors have the ability to schedule activities and hence expenditure in accordance with theavailability of funds and their cash forecasts.Based on thesuccess in raising capitalpost year end as outlined above,the Directors are confident,that the Consolidated entity is well funded for the current planned works and for at least the next twelve months from the date of this report, and that the going concern basis of preparation for the financial report is appropriate.29LAKE RESOURCES NLNotes to the financial statementsfor the year ended 30 June 2021v.Parent entity informationInaccordance with theCorporations Act 2001, these financial statements presenttheresults of theConsolidated entity only.Supplementary information about the parent entity is disclosed in note 22.vi.Principles of consolidationThe consolidated financial statements incorporate all of theassets, liabilities and results of the parent(Lake Resources NL)and allof the subsidiaries. Subsidiaries are entities the parent controls. The parent controls anentity when it is exposed to,or has rights to, variable returnsfrom its involvement with the entity and has theability to affect those returnsthrough itspower over the entity.A list of subsidiaries is provided in note 23. Theassets, liabilitiesandresults ofall subsidiaries are fully consolidated into the financial statements of the Consolidated entityfrom the date on which control is obtainedby the Consolidated entity. The consolidationofa subsidiary is discontinuedfrom the date thatcontrol ceases. Intercompany transactions, balances and unrealised gainsor losses on transactionsbetweenconsolidated entitiesare fully eliminated on consolidation. Accounting policiesof subsidiaries have been changedand adjustments madewhere necessaryto ensure uniformity of the accounting policies adoptedby the Consolidated entity. vii.Operating segmentsOperatingsegmentsarepresented using the 'management approach', where the information presented is onthe same basisasthe internal reportsprovided to the ChiefOperatingDecision Makers('CODM').The CODM is responsible for the allocationofresources to operating segments and assessing their performance.viii.Foreign currency translationThe consolidated financial statements are presented in Australian dollars.The functional currency of each of the entities in the Consolidated entityis measured using the currency of the primary economic environment in which the entity operates. The Consolidated entity’s financial statements are presented in Australian dollars which is the functional and presentation currency of Lake Resources N.L. (the parent and reporting entity). Transactions and balancesForeign currency transactions are translated into functional currency using the exchange rates prevailing at the date of the transaction. Foreign currency monetary items are translated at the year-end exchange rate. Non-monetary items measured at historical cost continue to be carried at the exchange rate at the date of the transaction. Non-monetary items measured at fair value are reported at the exchange rate at the date when fair values were determined.Exchange differences arising on the translation of monetary items are recognised in the statement of profit or lossand other comprehensive income, except where deferred in equity as a qualifying cash flow or net investment hedge. Exchange differences arising on the translation of non-monetary items are recognised directly in equity to the extent that the gain or lossis directly recognised in equity, otherwise the exchange difference is recognised in the statement of profit or loss and other comprehensive income. Foreign operationsThe functional currency of the Consolidated entity’s foreign operations in Argentina isUS Dollars (USD). From 1 July 2018, Argentina was declared a hyperinflationary economy due to the significant devaluation of the Argentine Peso (ARS). However, as the functional currency of the Argentine subsidiaries is USD, there was no material impact arising from the hyperinflationary effects of the ARS to the Consolidated entity’s consolidated financial report. 30LAKE RESOURCES ANNUAL REPORT 202138 LAKE RESOURCES NLNotes to the financial statementsfor the year ended 30 June 2021The assets and liabilities of foreign operations are translated into Australian dollars (the presentation currency) using the exchange rates at the reporting date. The revenues and expenses of foreign operations are translated into Australian dollars using the average exchange rates, which approximate the rates at the dates of the transactions, for the period. All resulting foreign exchange differences are recognised in other comprehensive income through the foreign currency reserve in equity. The foreign currency reserve is recognised in profit or loss when the foreign operation or net investment is disposed.ix.Financial InstrumentsInvestments and other financialassets are initially measuredat fair value.Transaction costsare included as partofthe initialmeasurement, except for financialassets at fair value throughprofit or loss. Such assets aresubsequently measuredateither amortisedcost or fair value depending on their classification. Classification is determined based on both the businessmodel withinwhich suchassets are held and thecontractual cashflow characteristics of the financialasset unless, anaccounting mismatch is beingavoided.Financial assets at amortised costFinancial assets at amortised cost are held for collection of contractual cash flows where those cash flows represent solely payments of principal and interest.They are carried at amortised cost using the effective interest rate method. Gains and losses are recognised in profit or loss when the asset is derecognised or impaired.Financial assets at fair value through profit orlossFinancial assets not measured at amortised cost or at fair value through other comprehensive income are classified as financial assets at fair value through profit or loss. Typically, such financial assets will be either: (i) held for trading, where they are acquired for the purpose of selling in the short-term with an intention of making a profit, or a derivative; or (ii) designated as such upon initial recognition where permitted. Fair value movements are recognised in profit or loss.Financial assets at fair value through comprehensive incomeFinancial assets at fair value through other comprehensive income include equity investments which the Consolidated entityintends to hold for the foreseeable future and has irrevocably elected to classify them as such upon initial recognition.Impairment of financial assetsThe Consolidated entity recognises a loss allowance for expected credit losses on financial assets which are either measured at amortised cost or fair value through other comprehensive income. The measurement of the loss allowance depends upon the Consolidated entity's assessment at the end of each reporting period as to whether the financial instrument's credit risk has increased significantly since initial recognition, based on reasonable and supportable information that is available, without undue cost or effort to obtain.Where there has not been a significant increase in exposure to credit risk since initial recognition, a 12-month expected credit loss allowance is estimated. This represents a portion of the asset's lifetime expected credit losses that is attributable to a default event that is possible within the next 12 months. Where a financial asset has become credit impaired or where it is determined that credit risk has increased significantly, the loss allowance is based on the asset's lifetime expected credit losses. The amount of expected credit loss recognised is measured on the basis of the probability weighted present value of anticipated cash shortfalls over the life of the instrument discounted at the original effective interest rate.For financial assets measured at fair value through other comprehensive income, the loss allowance is recognised within other comprehensive income. In all other cases, the loss allowance is recognised in profit or loss. 31LAKE RESOURCES ANNUAL REPORT 202139 LAKE RESOURCES NLNotes to the financial statementsfor the year ended 30 June 2021The assets and liabilities of foreign operations are translated into Australian dollars (the presentation currency) using the exchange rates at the reporting date. The revenues and expenses of foreign operations are translated into Australian dollars using the average exchange rates, which approximate the rates at the dates of the transactions, for the period. All resulting foreign exchange differences are recognised in other comprehensive income through the foreign currency reserve in equity. The foreign currency reserve is recognised in profit or loss when the foreign operation or net investment is disposed.ix.Financial InstrumentsInvestments and other financialassets are initially measuredat fair value.Transaction costsare included as partofthe initialmeasurement, except for financialassets at fair value throughprofit or loss. Such assets aresubsequently measuredateither amortisedcost or fair value depending on their classification. Classification is determined based on both the businessmodel withinwhich suchassets are held and thecontractual cashflow characteristics of the financialasset unless, anaccounting mismatch is beingavoided.Financial assets at amortised costFinancial assets at amortised cost are held for collection of contractual cash flows where those cash flows represent solely payments of principal and interest.They are carried at amortised cost using the effective interest rate method. Gains and losses are recognised in profit or loss when the asset is derecognised or impaired.Financial assets at fair value through profit orlossFinancial assets not measured at amortised cost or at fair value through other comprehensive income are classified as financial assets at fair value through profit or loss. Typically, such financial assets will be either: (i) held for trading, where they are acquired for the purpose of selling in the short-term with an intention of making a profit, or a derivative; or (ii) designated as such upon initial recognition where permitted. Fair value movements are recognised in profit or loss.Financial assets at fair value through comprehensive incomeFinancial assets at fair value through other comprehensive income include equity investments which the Consolidated entityintends to hold for the foreseeable future and has irrevocably elected to classify them as such upon initial recognition.Impairment of financial assetsThe Consolidated entity recognises a loss allowance for expected credit losses on financial assets which are either measured at amortised cost or fair value through other comprehensive income. The measurement of the loss allowance depends upon the Consolidated entity's assessment at the end of each reporting period as to whether the financial instrument's credit risk has increased significantly since initial recognition, based on reasonable and supportable information that is available, without undue cost or effort to obtain.Where there has not been a significant increase in exposure to credit risk since initial recognition, a 12-month expected credit loss allowance is estimated. This represents a portion of the asset's lifetime expected credit losses that is attributable to a default event that is possible within the next 12 months. Where a financial asset has become credit impaired or where it is determined that credit risk has increased significantly, the loss allowance is based on the asset's lifetime expected credit losses. The amount of expected credit loss recognised is measured on the basis of the probability weighted present value of anticipated cash shortfalls over the life of the instrument discounted at the original effective interest rate.For financial assets measured at fair value through other comprehensive income, the loss allowance is recognised within other comprehensive income. In all other cases, the loss allowance is recognised in profit or loss. 31LAKE RESOURCES NLNotes to the financial statementsfor the year ended 30 June 2021x.Income taxThe income tax expense (income) for the year comprises current income tax expense (income) and deferred tax expense (income).Current income tax expense charged to the profit or loss is the tax payable on taxable income. Current tax liabilities/(assets) are measured at the amounts expected to be paid to/(recovered from) the relevant tax authority.Deferred income tax expense reflects movements in deferred tax asset and deferred tax liability balances during the year as well unused tax losses.Current and deferred income tax expense (income) is charged or credited outside profit or loss when the tax relates to items that are recognised outside profit or loss.Deferred tax assets and liabilities are calculated at the rates that are expected to apply to the period when the asset is realised,or the liability is settled,and their measurement also reflects the manner in which management expects to recover or settle the carrying amount of the related asset or liability.Deferred tax assets relating to temporary differences and unused tax lossesare recognised only to the extent that it is probable that future taxable profit will be available against which the benefits of the deferred tax asset can be utilised.Where temporary differences exist in relation to investments in subsidiaries, branches, associates, and joint ventures, deferred tax assets and liabilities are not recognised where the timing of the reversal of the temporary difference can be controlled,and it is not probable that the reversal will occur in the foreseeable future.Current tax assets and liabilities are offset where a legally enforceable right of set-off exists and it is intended that net settlement or simultaneous realisation and settlement of the respective asset and liability will occur. Deferred tax assets and liabilities are offset where a legally enforceable right of set-off exists, the deferred tax assets and liabilities relate to income taxes levied by the same taxation authority on either the same taxable entity or different taxable entities where it is intended thatnet settlement or simultaneous realisation and settlement of the respective asset and liability will occur in future periods in which significant amounts of deferred tax assets or liabilities are expected to be recovered or settled.xi.Current and non-current classificationAssets and liabilitiesarepresented in the statementof financial position based on current and non-current classification. An asset is classifiedas current when: it is eitherexpected to be realisedor intended to besold orconsumed in theConsolidated entity's normal operating cycle; it is held primarily for the purpose of trading; it is expected to be realised within12 months after the reporting period;or the asset is cashor cash equivalent unlessrestrictedfrom beingexchangedorusedto settle a liability for at least 12 monthsafter the reporting period. All other assets are classifiedas non-current. A liability is classified as current when: it is either expected to be settled in the Consolidated entity's normal operatingcycle;it is held primarily for the purpose of trading; it is due to besettled within 12 months after the reporting period;or there is nounconditional right to deferthe settlement of the liability forat least 12 months after the reporting period. All other liabilitiesare classifiedas non-current. Deferredtaxassets and liabilitiesare always classifiedas non-current. xii.Cash and cash equivalentsCash and cash equivalents include cashon hand, deposits held at call with banks, othershort-term highly liquid investmentswith original maturitiesof three months or less. 32LAKE RESOURCES ANNUAL REPORT 202140 LAKE RESOURCES NLNotes to the financial statementsfor the year ended 30 June 2021xiii.Other receivablesOther receivablesarerecognised at amortisedcost, less any allowance forexpected credit losses.xiv.Interest in joint arrangementsJointarrangements represent the contractual sharingof control between parties in a business venturewhere unanimousdecisions about relevant activitiesare required. Separate jointventure entitiesproviding joint venturers with an interest in net assets are classifiedas a jointventure andaccounted forusing the equity methodofaccounting, whereby the investment is initially recognised at cost and adjustedthereafter for the post-acquisition change in the Consolidated entity'sshareofnetassets of the jointventure.xv.Exploration and development expenditureExploration, evaluation and development expenditure incurredarecapitalised in respect of each identifiableareaof interest.These costsare only capitalisedto the extent that theyareexpected to be recovered throughthe successful developmentofthe area or whereactivities in thearea have not yet reached a stage that permits reasonable assessment of the existenceofeconomically recoverable reserves.A regularreview is undertakenof eachareaof interest to determine the appropriateness of continuing to capitalise costs inrelation to that areaof interest.Costsofsite restoration are providedover the life of theprojectfrom when explorationcommences andareincluded in thecostsof that stage. Site restoration costs include the dismantling andremovalof miningplant, equipment and buildingstructures, wasteremoval, and rehabilitationof the site in accordance with local laws and regulations and clausesof thepermits. Such costs have been determined using estimates offuture costs, current legal requirements, and technology on anundiscounted basis. Any changes in the estimates for the costsareaccountedon a prospective basis. In determining the costsofsite restoration,there is uncertainty regarding the nature and extent of the restoration due to communityexpectations and future legislation.Accordingly, the costs have been determined on the basis that therestoration will be completed within oneyearof abandoningthe site.xvi.Impairment of non-financial assetsAt each reporting date, theConsolidated entityassesses whether there is any indication that a set may be impaired. The assessmentwill include the consideration ofexternal and internal sourcesof information. If such an indication exists,an impairment testis carried out on the assetby comparing therecoverable amount of the asset, being the higher oftheasset's fair value lesscosts to sell and value in use, to theassets carryingamount. Anyexcessoftheasset's carrying amountover its recoverableamount is recognised immediately in profit or loss. Whereit is not possible to estimate the recoverable amount ofan individualasset, the Consolidated entityestimates therecoverableamount of the cash-generating unit to which the asset belongs.xvii.Trade and other payablesThese amounts represent liabilitiesfor goods and servicesprovided to theConsolidated entitypriorto the end ofthe financialyear and which are unpaid. Due to their short-term nature, they are measured at amortised cost and are not discounted. Theamounts are unsecured and are usually paid within 30 days ofrecognition. xviii.BorrowingsLoans and borrowings are initially recognisedat the fair valueof the consideration received, net of transaction costs.Theyare subsequently measured at amortisedcostusing the effective interest method. Wherethere is an unconditional right to defer settlement of the liability for at least12 months after thereporting date, theloansorborrowingsare classifiedas non-current. 33LAKE RESOURCES ANNUAL REPORT 202141 LAKE RESOURCES NLNotes to the financial statementsfor the year ended 30 June 2021xiii.Other receivablesOther receivablesarerecognised at amortisedcost, less any allowance forexpected credit losses.xiv.Interest in joint arrangementsJointarrangements represent the contractual sharingof control between parties in a business venturewhere unanimousdecisions about relevant activitiesare required. Separate jointventure entitiesproviding joint venturers with an interest in net assets are classifiedas a jointventure andaccounted forusing the equity methodofaccounting, whereby the investment is initially recognised at cost and adjustedthereafter for the post-acquisition change in the Consolidated entity'sshareofnetassets of the jointventure.xv.Exploration and development expenditureExploration, evaluation and development expenditure incurredarecapitalised in respect of each identifiableareaof interest.These costsare only capitalisedto the extent that theyareexpected to be recovered throughthe successful developmentofthe area or whereactivities in thearea have not yet reached a stage that permits reasonable assessment of the existenceofeconomically recoverable reserves.A regularreview is undertakenof eachareaof interest to determine the appropriateness of continuing to capitalise costs inrelation to that areaof interest.Costsofsite restoration are providedover the life of theprojectfrom when explorationcommences andareincluded in thecostsof that stage. Site restoration costs include the dismantling andremovalof miningplant, equipment and buildingstructures, wasteremoval, and rehabilitationof the site in accordance with local laws and regulations and clausesof thepermits. Such costs have been determined using estimates offuture costs, current legal requirements, and technology on anundiscounted basis. Any changes in the estimates for the costsareaccountedon a prospective basis. In determining the costsofsite restoration,there is uncertainty regarding the nature and extent of the restoration due to communityexpectations and future legislation.Accordingly, the costs have been determined on the basis that therestoration will be completed within oneyearof abandoningthe site.xvi.Impairment of non-financial assetsAt each reporting date, theConsolidated entityassesses whether there is any indication that a set may be impaired. The assessmentwill include the consideration ofexternal and internal sourcesof information. If such an indication exists,an impairment testis carried out on the assetby comparing therecoverable amount of the asset, being the higher oftheasset's fair value lesscosts to sell and value in use, to theassets carryingamount. Anyexcessoftheasset's carrying amountover its recoverableamount is recognised immediately in profit or loss. Whereit is not possible to estimate the recoverable amount ofan individualasset, the Consolidated entityestimates therecoverableamount of the cash-generating unit to which the asset belongs.xvii.Trade and other payablesThese amounts represent liabilitiesfor goods and servicesprovided to theConsolidated entitypriorto the end ofthe financialyear and which are unpaid. Due to their short-term nature, they are measured at amortised cost and are not discounted. Theamounts are unsecured and are usually paid within 30 days ofrecognition. xviii.BorrowingsLoans and borrowings are initially recognisedat the fair valueof the consideration received, net of transaction costs.Theyare subsequently measured at amortisedcostusing the effective interest method. Wherethere is an unconditional right to defer settlement of the liability for at least12 months after thereporting date, theloansorborrowingsare classifiedas non-current. 33LAKE RESOURCES NLNotes to the financial statementsfor the year ended 30 June 2021xix.Finance costsFinance costsattributable to qualifyingassets are capitalisedas partof the asset. All other finance costsareexpensed inthe period in which they are incurred. xx.Employee benefitsShort-term employee benefitsLiabilities for wages and salaries, including non-monetary benefits, annual leave and long service leave expected to besettled wholly within 12 months of the reporting date are measured at the amounts expected to be paid when the liabilitiesare settled. Defined contribution superannuation expenseContributions to defined contribution superannuation plans areexpensed in the period in which theyare incurred. Share-based paymentsEquity-settled and cash-settled share-based compensation benefits are provided to employees.Equity-settled transactions are awards of shares, or options over shares, that are provided to employees in exchange for the rendering of services. Cash-settled transactions are awards of cash for the exchange of services, where the amount of cash is determined by reference to the share price.Thecost of equity-settled transactions are measured at fair value on grant date. Fair value is determined using either the Binomial or Black-Scholes option pricing model that takes into account the exercise price, the term of the option, the impact of dilution, the share price at grant date and expected price volatility of the underlying share, the expected dividend yield and the risk free interest rate for the term of the option, together with non-vesting conditions that do not determine whether the Consolidated entityreceives the services that entitle the employees to receive payment. No account is taken of any other vesting conditions.The cost of equity-settled transactions are recognised as an expense with a corresponding increase in equity over the vesting period. The cumulative charge to profit or loss is calculated based on the grant date fair value of the award, the best estimate of the number of awards that are likely to vest and the expired portion of the vesting period. The amount recognised in profit or loss for the period is the cumulative amount calculated at each reporting date less amounts already recognised in previous periods.The costof cash-settled transactions is initially, and at each reporting date until vested, determined by applyingeither theBinomial or Black-Scholes option pricing model, taking into consideration the terms and conditions onwhich theaward wasgranted. The cumulative charge to profit or loss until settlementof the liability is calculated as follows:•during the vesting period, the liability at each reporting date is the fair value of the award at that datemultiplied by the expired portion of the vesting period.•from the end of the vesting period until settlement of the award, the liability is the full fair valueof the liabilityat the reporting date.Allchanges in the liability arerecognised in profit orloss.The ultimate costof cash-settledtransactions is the cash paid tosettle the liability.Market conditionsare taken into consideration in determining fair value. Therefore, any awards subject to marketconditionsare considered to vest irrespective of whetheror not that market condition has been met, provided all other conditions aresatisfied.If equity-settled awardsare modified, as a minimum an expense is recognisedas if the modification has not beenmade. Anadditional expense is recognised, over the remaining vesting period, for any modification that increasesthe total fair valueof the share-based compensation benefit as at the date of modification. If the non-vesting condition is within the control of the Consolidated entityor employee, the failure to satisfythe34LAKE RESOURCES ANNUAL REPORT 202142 LAKE RESOURCES NLNotes to the financial statementsfor the year ended 30 June 2021condition istreated as a cancellation. If the condition is not within the control of the Consolidated entityor employee and is not satisfiedduring the vesting period, anyremaining expense for theaward is recognisedover theremaining vesting period, unless theaward is forfeited.If equity-settled awardsare cancelled, it is treated as if it has vested on the date of cancellation, and any remaining expense is recognised immediately. If a new replacement award is substituted for the cancelled award, the cancelled and new award is treated as if they were a modification. xxi.Fair Value of Assets and LiabilitiesTheConsolidated entity may measure some of itsassets and liabilitiesat fair value on either arecurringor non-recurring basis afterinitial recognition, depending in the requirementsof the applicable Accounting Standard.Currently though there are no assetsor liabilities measured at fair value. Fair valueistheprice theConsolidated entity would receive to see an assetorwould have to pay to transfer a liability in anorderly (i.e.,unforced) transaction between independent, knowledgeable, and willing marketparticipantsat the measurement date. As fair value is a market-based measure, the closest equivalent observable marketpricing information is usedtodeterminefair value. Adjustments to marketvalues may be made havingregard to the characteristics of the specific assetor liability.The fair values of assets and liabilities thatare not traded in an active market are determined using oneor more valuationtechniques. These valuations techniques maximise, to the extent possible, the use of observable market data.For non-financial assets, the fair value measurement also takes into account a market participant's ability to use theasset inits highest and best use or to sell it to another market participant that would use the asset in itshighest and best use.xxii.ProvisionsProvisions are recognisedwhen the Consolidated entity has a legal or constructive obligation, as a result of past events, for which itis probable that an outflowofeconomic benefits will result, and that outflow can be reliably measured. Provisionsare measuredusing the best estimate of the amounts required to settle the obligationatthe end of the reportingperiod.xxiii.Issued capitalOrdinarysharesare classifiedas equity.Incremental costs directly attributable to the issueof new sharesor options are shown in equity as a deduction, net of tax,from the proceeds. xxiv.Business combinationsTheacquisition method ofaccounting is used to account for business combinations regardlessof whether equity instrumentsor other assets areacquired.The consideration transferred is thesum of the acquisition-date fair values of the assets transferred, equity instrumentsissued,or liabilities incurredby the acquirer to former ownersof the acquiree and the amountof anynon-controlling interestin the acquiree.For each businesscombination, the non-controlling interest in the acquiree ismeasuredat either fair valueorat the proportionate share of the acquiree's identifiable netassets. All acquisition costsareexpensedas incurred to profitor loss.On theacquisitionof a business, theConsolidated entityassessesthe financial assets acquired and liabilitiesassumed forappropriate classification and designation in accordance with the contractual terms,economicconditions, theConsolidated entity's operatingoraccounting policies and other pertinentconditions in existence at theacquisition-date. 35LAKE RESOURCES ANNUAL REPORT 202143 LAKE RESOURCES NLNotes to the financial statementsfor the year ended 30 June 2021condition istreated as a cancellation. If the condition is not within the control of the Consolidated entityor employee and is not satisfiedduring the vesting period, anyremaining expense for theaward is recognisedover theremaining vesting period, unless theaward is forfeited.If equity-settled awardsare cancelled, it is treated as if it has vested on the date of cancellation, and any remaining expense is recognised immediately. If a new replacement award is substituted for the cancelled award, the cancelled and new award is treated as if they were a modification. xxi.Fair Value of Assets and LiabilitiesTheConsolidated entity may measure some of itsassets and liabilitiesat fair value on either arecurringor non-recurring basis afterinitial recognition, depending in the requirementsof the applicable Accounting Standard.Currently though there are no assetsor liabilities measured at fair value. Fair valueistheprice theConsolidated entity would receive to see an assetorwould have to pay to transfer a liability in anorderly (i.e.,unforced) transaction between independent, knowledgeable, and willing marketparticipantsat the measurement date. As fair value is a market-based measure, the closest equivalent observable marketpricing information is usedtodeterminefair value. Adjustments to marketvalues may be made havingregard to the characteristics of the specific assetor liability.The fair values of assets and liabilities thatare not traded in an active market are determined using oneor more valuationtechniques. These valuations techniques maximise, to the extent possible, the use of observable market data.For non-financial assets, the fair value measurement also takes into account a market participant's ability to use theasset inits highest and best use or to sell it to another market participant that would use the asset in itshighest and best use.xxii.ProvisionsProvisions are recognisedwhen the Consolidated entity has a legal or constructive obligation, as a result of past events, for which itis probable that an outflowofeconomic benefits will result, and that outflow can be reliably measured. Provisionsare measuredusing the best estimate of the amounts required to settle the obligationatthe end of the reportingperiod.xxiii.Issued capitalOrdinarysharesare classifiedas equity.Incremental costs directly attributable to the issueof new sharesor options are shown in equity as a deduction, net of tax,from the proceeds. xxiv.Business combinationsTheacquisition method ofaccounting is used to account for business combinations regardlessof whether equity instrumentsor other assets areacquired.The consideration transferred is thesum of the acquisition-date fair values of the assets transferred, equity instrumentsissued,or liabilities incurredby the acquirer to former ownersof the acquiree and the amountof anynon-controlling interestin the acquiree.For each businesscombination, the non-controlling interest in the acquiree ismeasuredat either fair valueorat the proportionate share of the acquiree's identifiable netassets. All acquisition costsareexpensedas incurred to profitor loss.On theacquisitionof a business, theConsolidated entityassessesthe financial assets acquired and liabilitiesassumed forappropriate classification and designation in accordance with the contractual terms,economicconditions, theConsolidated entity's operatingoraccounting policies and other pertinentconditions in existence at theacquisition-date. 35LAKE RESOURCES NLNotes to the financial statementsfor the year ended 30 June 2021Wherethe business combination is achieved in stages, the Consolidated entity remeasures its previously heldequity interestin theacquireeat theacquisition-date fair value and the difference between the fair value andtheprevious carrying amountis recognised in profit or loss. Contingent consideration to be transferredby the acquirer is recognisedat the acquisition-date fair value. Subsequentchanges in the fair value of the contingentconsideration classified asanassetor liability is recognised in profit or loss.Contingent considerationclassified as equity is not remeasured and its subsequentsettlement is accounted for within equity. The difference betweentheacquisition-date fair value of assets acquired, liabilitiesassumed and any non-controlling interestin theacquiree and the fair valueof the considerationtransferred and the fair value of any pre-existing investment in theacquiree is recognisedas goodwill. If theconsiderationtransferred and thepre-existing fair value isless than the fair valueof the identifiable netassetsacquired, being a bargain purchase to the acquirer, the difference is recognisedas a gain directlyin profit or lossby theacquireron the acquisition-date, but only after a reassessmentof the identification and measurementof the netassetsacquired, the non-controlling interest in the acquiree, if any, the considerationtransferred and the acquirer'spreviously held equity interest in theacquirer.Businesscombinations are initially accounted foron a provisional basis. The acquirer retrospectively adjusts the provisionalamounts recognised and also recognises additional assets or liabilities during the measurement period, based on newinformation obtained about the facts and circumstances that existed at the acquisition-date. The measurement period endson either the earlier of (i) 12 months from the date of the acquisitionor (ii) when the acquirerreceives all the informationpossible to determine fair value.xxv.Earnings per shareBasic earnings per shareBasic earnings per share is calculated by dividing the profit attributable to the owners of Lake Resources NL, excluding any costs of servicing equity other thanordinary shares, by the weighted average number of ordinary shares outstanding during the financial year, adjusted for bonus elements in ordinary shares issued during the financial year.Diluted earnings per shareDiluted earnings per share adjusts the figures used in the determination of basic earnings per share to take into account the after-incometax effect of interest and other financing costs associated with dilutive potential ordinary shares and the weighted average number of shares assumed to have been issued for no consideration in relation to dilutive potential ordinary shares. xxvi.Goods and Services Tax ('GST') and other similar taxesRevenues,expenses, andassets arerecognised net of the amount of GST, except where the amount of GST incurred is notrecoverable from the AustralianTaxOffice.Receivables and payablesare stated inclusive of the amountof GST receivable or payable. The netamount of GSTrecoverable from, or payable to,the ATO arepresentedas operating cash flows included in receipts from customersorpayments tosuppliers. Cash flowsarepresented on a gross basis. The GST components of cash flowsarising from investingor financingactivitieswhich arerecoverable from,or payable to, the ATO arepresentedas operating cash flowsincluded in receiptsfromcustomersorpayments to suppliers.Value Added Tax (VAT) in Argentina is assessable on the sale value of goods and services. To the extent that VAT credits on purchased goods and services cannot be claimed as refunds, the amountis recognised in income tax expense.36LAKE RESOURCES ANNUAL REPORT 202144 LAKE RESOURCES NLNotes to the financial statementsfor the year ended 30 June 2021xxvii.Comparative FiguresWhen required by Accounting Standards, comparative figures have been adjusted to conform to changes in presentation for the current financial year. Note2. Critical accountingjudgements, estimates and assumptions Thepreparationof the financial statements requires management to make judgements, estimates and assumptions thataffect the reported amounts in the financial statements. Managementcontinually evaluatesits judgements and estimates inrelation to assets, liabilities, contingent liabilities,revenue and expenses.Management bases its judgements, estimates andassumptions on historical experience and on other variousfactors, including expectations of futureevents, managementbelieves to be reasonable under the circumstances. Theresultingaccounting judgements andestimates will seldom equalthe relatedactual results.The judgements estimates and assumptions that have a significant risk of causing a materialadjustment to the carrying amounts ofassets and liabilities(refer to the respective notes) within the nextfinancial year arediscussed below. Share-based payment transactionsThe Consolidated entitymeasures the cost of equity-settled transactions with employees by reference to the fair value of the equity instruments at the date at which they are granted. The fair value is determined by using either the Binomial or Black- Scholes model taking into account the terms and conditions upon which the instruments were granted. The accounting estimates and assumptions relating to equity-settled share-based payments would have no impact on the carrying amounts of assets and liabilities within the next annual reporting period but may impact profit or loss and equity.Exploration and evaluation costsExploration and evaluation costs have been capitalised on the basis that the Consolidated entitywill commence commercial production in the future, from which time the costs will be amortised in proportion to the depletion of the mineral resources. Key judgements are applied in considering costs to be capitalised which includes determining expenditures directly related to these activities and allocating overheads between those that are expensed and capitalised. In addition, costs are only capitalised that are expected to be recovered either through successful development or sale of the relevant mining interest. Factors that could impact the future commercial production at the mine include the level of reserves and resources, future technology changes, which could impact the cost of mining, future legal changes and changes in commodity prices. To the extent that capitalised costs are determined not to be recoverable in the future, they will be written off in the period in which this determination is made.37LAKE RESOURCES ANNUAL REPORT 202145 LAKE RESOURCES NLNotes to the financial statementsfor the year ended 30 June 2021xxvii.Comparative FiguresWhen required by Accounting Standards, comparative figures have been adjusted to conform to changes in presentation for the current financial year. Note2. Critical accountingjudgements, estimates and assumptions Thepreparationof the financial statements requires management to make judgements, estimates and assumptions thataffect the reported amounts in the financial statements. Managementcontinually evaluatesits judgements and estimates inrelation to assets, liabilities, contingent liabilities,revenue and expenses.Management bases its judgements, estimates andassumptions on historical experience and on other variousfactors, including expectations of futureevents, managementbelieves to be reasonable under the circumstances. Theresultingaccounting judgements andestimates will seldom equalthe relatedactual results.The judgements estimates and assumptions that have a significant risk of causing a materialadjustment to the carrying amounts ofassets and liabilities(refer to the respective notes) within the nextfinancial year arediscussed below. Share-based payment transactionsThe Consolidated entitymeasures the cost of equity-settled transactions with employees by reference to the fair value of the equity instruments at the date at which they are granted. The fair value is determined by using either the Binomial or Black- Scholes model taking into account the terms and conditions upon which the instruments were granted. The accounting estimates and assumptions relating to equity-settled share-based payments would have no impact on the carrying amounts of assets and liabilities within the next annual reporting period but may impact profit or loss and equity.Exploration and evaluation costsExploration and evaluation costs have been capitalised on the basis that the Consolidated entitywill commence commercial production in the future, from which time the costs will be amortised in proportion to the depletion of the mineral resources. Key judgements are applied in considering costs to be capitalised which includes determining expenditures directly related to these activities and allocating overheads between those that are expensed and capitalised. In addition, costs are only capitalised that are expected to be recovered either through successful development or sale of the relevant mining interest. Factors that could impact the future commercial production at the mine include the level of reserves and resources, future technology changes, which could impact the cost of mining, future legal changes and changes in commodity prices. To the extent that capitalised costs are determined not to be recoverable in the future, they will be written off in the period in which this determination is made.37LAKE RESOURCES NLNotes to the financial statementsfor the year ended 30 June 2021Note 3. Operating segmentsSegment InformationThe Consolidated entitycurrently operates entirely in the mineral exploration industry with interests in Argentina and corporate operations in Australia. Accordingly, the information provided to the Board of Directors is prepared using the same measures used in preparing the financial statements.Geographical informationArgentinaAustralia2021202020212020$$$$Income statementExpenses-(44,021)(2,894,223)(4,858,875)Loss after income tax expense for the year attributable to the owners of Lake Resources NL-(44,021)(2,894,223)(4,858,875)AssetadditionsExploration expenditure4,911,1333,425,876--Property, plant and equipment79,746---Total assets21,973,065 17,352,504 25,945,878 360,919Total Liabilities 350,185 205,862 697,488 458,273Note 4. Loss before income taxLoss before income tax includes the following specific expenses:Consolidated20212020$$Corporate expensesAllowance for credit losses(refer note 7)146,352 -Consultancy and legal costsLegal expenses76,041 57,534 Finance costsInterest and finance charges paid/payable27,500465,783 Net foreign exchange lossNet foreign exchange gain (loss)299,471 13,887 Superannuation expenseDefined contribution superannuation expense28,995 28,995 38LAKE RESOURCES ANNUAL REPORT 202146 LAKE RESOURCES NLNotes to the financial statementsfor the year ended 30 June 2021Note 5. Income tax expenseNumerical reconciliation of income tax expense and tax at the statutory rateConsolidated20212021$$Loss before income tax expense(2,894,223)(4,858,875)Tax at the statutory tax rate of 26%(2020: 27.5%)(752,498)(1,336,191)Tax effect amounts which are not deductible/(taxable) in calculating taxable income: Share based payments-336,025Other non-deductible / (allowable) expenses17,8724,081(734,626)(996,085)Future income tax benefit of tax losses not brought to account(734,626)(996,085)Income tax expense - - TheConsolidated entity has unrecouped, unconfirmedcarry forward tax lossesof approximately $14.7million (2020: $14.0 million).A deferred income taxassetarising from carry forward tax losses will only be recognised to the extent that: (a)it is probable that the Consolidated entity will derive futureassessable income of a nature andofanamount sufficient to enablethe benefits from the deductions for the losses to be realised.(b)theConsolidated entity continues to comply with the conditions for deductibility imposedby the law; and(c)nochanges in tax legislation adversely affect the Consolidated entity in realising the benefit from the lossesNote 6. Current assets -cash and cash equivalentsConsolidated20212020$$Cash at bank and on hand25,657,07455,511Note 7. Current assets -other receivablesOther receivables424,431304,841Credit loss(146,352)-Total trade and other receivables278,079 304,841 Other receivables includeamounts recoverable from the ATO in relation to GST and from shareholders for the issue of shares in prior years. Directors have reviewed the uncollected amounts from shareholders and concluded the funds are not recoverable. Accordingly, the receivables have beenimpaired to zero. Note 8. Current assets -other current assetsDeposits5,000 -Prepayment161,996Total other current assets166,996 - 39LAKE RESOURCES ANNUAL REPORT 202147 LAKE RESOURCES NLNotes to the financial statementsfor the year ended 30 June 2021Note 5. Income tax expenseNumerical reconciliation of income tax expense and tax at the statutory rateConsolidated20212021$$Loss before income tax expense(2,894,223)(4,858,875)Tax at the statutory tax rate of 26%(2020: 27.5%)(752,498)(1,336,191)Tax effect amounts which are not deductible/(taxable) in calculating taxable income: Share based payments-336,025Other non-deductible / (allowable) expenses17,8724,081(734,626)(996,085)Future income tax benefit of tax losses not brought to account(734,626)(996,085)Income tax expense - - TheConsolidated entity has unrecouped, unconfirmedcarry forward tax lossesof approximately $14.7million (2020: $14.0 million).A deferred income taxassetarising from carry forward tax losses will only be recognised to the extent that: (a)it is probable that the Consolidated entity will derive futureassessable income of a nature andofanamount sufficient to enablethe benefits from the deductions for the losses to be realised.(b)theConsolidated entity continues to comply with the conditions for deductibility imposedby the law; and(c)nochanges in tax legislation adversely affect the Consolidated entity in realising the benefit from the lossesNote 6. Current assets -cash and cash equivalentsConsolidated20212020$$Cash at bank and on hand25,657,07455,511Note 7. Current assets -other receivablesOther receivables424,431304,841Credit loss(146,352)-Total trade and other receivables278,079 304,841 Other receivables includeamounts recoverable from the ATO in relation to GST and from shareholders for the issue of shares in prior years. Directors have reviewed the uncollected amounts from shareholders and concluded the funds are not recoverable. Accordingly, the receivables have beenimpaired to zero. Note 8. Current assets -other current assetsDeposits5,000 -Prepayment161,996Total other current assets166,996 - 39Consolidated20212020$$79,941 532 81,7462,000(1,805)(1,468)79,941 532 LAKE RESOURCES NLNotes to the financial statementsforthe yearended 30 June 2021Note9. Property, plant and equipmentProperty plant & equipmentAustralian assets:Plant & equipment atcostless depreciationTotalNote10. Non-current assets-explorationand evaluationExploration and evaluation assets -at cost21,736,85417,352,504ReconciliationsReconciliations of the written down values at the beginning and end of the current and previous financial year are set out below:Opening balance at 1 July17,352,50413,783,872Additions -direct exploration costs4,911,1333,425,876Foreign currency movement(225,152)142,756Impairment–Chile exploration expenditure(301,631)-Balance at 30 June21,736,85417,352,504 Exploration and evaluation costs are carried forward in the statement of financial position as detailed in accounting policy note 1. Recoverability of the carrying amount of exploration assets is dependent on the successful exploration of minerals.During the year Directors determined that the expenditure on the Chile exploration project no longer met the criteria for carrying forward expenditure and accordingly the project was impaired to nil.Note 11. Current liabilities - trade and other payablesConsolidated20212020$$Trade payables639,613 557,612 Sundry creditors and accrued expenses150,938 25,415 Balance at 30 June790,551 583,027 Refer to note 18for further information on financial instruments.40LAKE RESOURCES ANNUAL REPORT 202148 LAKE RESOURCES NLNotes to the financial statementsforthe yearended 30 June 2021Note 12. Current liabilities–borrowingsConsolidatedConsolidated20212021$$Short term loans--Convertible Notes--Total - - Movement in LoansShort term loansDuring the 2021 financial year a short-termloan for $200,000 was drawn and repaidin cash and through an issue of shares(refer below). Aloanservice fee of $27,500was paid through anissue of shares (refer Note 27 (d)). 2021Short term loan movementsLoandrawn200,000-Repayments -cash(167,500)-Loan service fee27,500-Repayments by share issue(60,000)-Closing balance- - 2020Convertible NotesDuring the 2020 financial year thethen existing facilities –an unsecured note facility and a facility drawn through SBI were paid out. Movements in the notes during the 2020 financial year were as follows:Notes$Unsecured Notes Opening balance4,400,000 472,502 Interest accrued-6,093Redeemed for cash(4,400,000)(478,595)Total - - SBI Convertible NotesOpening balance1,100,000 955,575 Issue of notes1,650,000 1,500,000 Redeemed for shares(550,000)(549,764)Early close out fee-523,272Early close out cash repayment(1,950,000)(1,966,762)Early close out share repayment(250,000)(462,321)Total - -Unsecured NotesA summaryof thekey terms of the Notesareset out below Denomination: The Notes were issued fully paid with a face valueof $0.10 per Note. MaturityDate: 18 months from the date of issue.Interest Rate: The Notes attract interestat 15% per annum, payable quarterly in arrears in cashor fully paid41LAKE RESOURCES ANNUAL REPORT 202149 LAKE RESOURCES NLNotes to the financial statementsforthe yearended 30 June 2021Note 12. Current liabilities–borrowingsConsolidatedConsolidated20212021$$Short term loans--Convertible Notes--Total - - Movement in LoansShort term loansDuring the 2021 financial year a short-termloan for $200,000 was drawn and repaidin cash and through an issue of shares(refer below). Aloanservice fee of $27,500was paid through anissue of shares (refer Note 27 (d)). 2021Short term loan movementsLoandrawn200,000-Repayments -cash(167,500)-Loan service fee27,500-Repayments by share issue(60,000)-Closing balance- - 2020Convertible NotesDuring the 2020 financial year thethen existing facilities –an unsecured note facility and a facility drawn through SBI were paid out. Movements in the notes during the 2020 financial year were as follows:Notes$Unsecured Notes Opening balance4,400,000 472,502 Interest accrued-6,093Redeemed for cash(4,400,000)(478,595)Total - - SBI Convertible NotesOpening balance1,100,000 955,575 Issue of notes1,650,000 1,500,000 Redeemed for shares(550,000)(549,764)Early close out fee-523,272Early close out cash repayment(1,950,000)(1,966,762)Early close out share repayment(250,000)(462,321)Total - -Unsecured NotesA summaryof thekey terms of the Notesareset out below Denomination: The Notes were issued fully paid with a face valueof $0.10 per Note. MaturityDate: 18 months from the date of issue.Interest Rate: The Notes attract interestat 15% per annum, payable quarterly in arrears in cashor fully paid41LAKE RESOURCES NLNotes to the financial statementsfor the year ended 30 June 2021ordinary sharesissued at 95% VWAP of the shares for the10-trading day period ending on the relevant interest payment date.Note 12. Current liabilities – borrowings(continued)Status and Ranking: The Notes rank equally withall other direct, unsubordinated and unsecured obligations of the Issuer.Conversion:TheNotesconvert into fully paid ordinary sharesat 80%VWAP of the shares for the 10-tradingday periodendingon the date of the conversion notice or maturity date. SBI Convertible notes - early close outIn 2020 financial year theConsolidated entityentered into a formal agreement with SBI Investments (PR), LLC(“SBI”), for the early close out of the Convertible Securities funding facility, through a combination of both a cash payment and the issue of shares to SBI (which included an equity-basedfee in consideration for the facility’s early termination). Under the agreement, the Consolidated entitymade a cash payment of A$1,966,762and issued SBI with 11,558,021 ordinary shares on 11 February 2020. SBI Convertible notes - early close outA summary of the key terms of the Notes isset out below:Denomination: The 1,820,00 Notes (first instalment) and the 1,650,000 Notes (second instalment) were issued fully paid with a face value of $0.909 per Note.Maturity Date: 18 months from the date of issue of the first investment amount and 12 months from the date of issue of the second investment amount. Interest Rate: The Consolidated entityauthorised the investor to deduct from the first investment amount the interest payable for the initial first investment securities interest periodat the rate of 15% per annum, being an amount equal to $248,250 (first year interest amount). The Consolidated entityauthorised the investor to deduct from the second investment amount the interest payable for the first three months interest periodat the rate of 12% per annum, being an amount equal to $45,000 (first quarter interest amount). Conversion: a)The number of shares to which the Investor is entitled upon conversion of the relevant convertible securityis determined by the following formula:Number of shares = ARA / Conversion Price, where:ARA: means the aggregate of the repayment amount of the Convertible Security being converted by theInvestor, plus any accrued (but unpaid) interest which is due and payable on the Conversion Date.Conversion Price: means the Conversion Price (as defined) per Convertible Security, which may besubsequently adjusted under this clause.b)Where the number of shares to be issued to the Investor under this clause (above) includes a fraction,that fraction will be rounded to the nearest whole number.42LAKE RESOURCES ANNUAL REPORT 202150 LAKE RESOURCES NLNotes to the financial statementsfor the year ended 30 June 2021Note 13. Employee benefits(a)Current liabilityConsolidated20212020$$Annual leave153,889 81,108 Wages payable -Argentina28,555-Leave and other benefits payable -Argentina46,680 -Closing balance at 30 June229,124 81,108 (b)Non-Current liabilityLong service leave27,998-Note 14. Equity -issued capital2021202020212020SharesShares$$Ordinary shares -fully paid1,058,077,327 671,461,95765,748,64235,433,060a)Movements in share capital:DescriptionDateNo of SharesPrice per share $2020$Opening balance1-Jul-19457,296,19227,758,605Options exercise2-Jul-1943,570 0.0401,743 Shares issued under Controlled Placement Agreement (CPA)2-Aug-1915,000,000 0.000 -SBI Note Conversion16-Jul-195,898,214 0.059349,764 Share Placement6-Sep-1945,319,508 0.0452,039,378 SBI Conversion11-Oct-192,757,100 0.036100,000 SBI Conversion18-Nov-193,217,503 0.031100,000 Redemption ofSBIconvertible notes11-Feb-2011,558,021 0.040462,321 Share Placement13-Feb-2036,521,850 0.0401,460,874 Share Placement27-Feb-2047,875,000 0.0401,915,000 Share Placement13-Mar-207,000,000 0.040280,000 Share Purchase Plan07-Apr-2038,975,000 0.0401,559,000 Refund of application monies for exercise of unlisted options - - (6,299)Capital raising costs -cash--(587,326)Closing balance 30 June 2020671,461,95835,433,06043LAKE RESOURCES ANNUAL REPORT 202151 LAKE RESOURCES NLNotes to the financial statementsfor the year ended 30 June 2021Note 13. Employee benefits(a)Current liabilityConsolidated20212020$$Annual leave153,889 81,108 Wages payable -Argentina28,555-Leave and other benefits payable -Argentina46,680 -Closing balance at 30 June229,124 81,108 (b)Non-Current liabilityLong service leave27,998-Note 14. Equity -issued capital2021202020212020SharesShares$$Ordinary shares -fully paid1,058,077,327 671,461,95765,748,64235,433,060a)Movements in share capital:DescriptionDateNo of SharesPrice per share $2020$Opening balance1-Jul-19457,296,19227,758,605Options exercise2-Jul-1943,570 0.0401,743 Shares issued under Controlled Placement Agreement (CPA)2-Aug-1915,000,000 0.000 -SBI Note Conversion16-Jul-195,898,214 0.059349,764 Share Placement6-Sep-1945,319,508 0.0452,039,378 SBI Conversion11-Oct-192,757,100 0.036100,000 SBI Conversion18-Nov-193,217,503 0.031100,000 Redemption ofSBIconvertible notes11-Feb-2011,558,021 0.040462,321 Share Placement13-Feb-2036,521,850 0.0401,460,874 Share Placement27-Feb-2047,875,000 0.0401,915,000 Share Placement13-Mar-207,000,000 0.040280,000 Share Purchase Plan07-Apr-2038,975,000 0.0401,559,000 Refund of application monies for exercise of unlisted options - - (6,299)Capital raising costs -cash--(587,326)Closing balance 30 June 2020671,461,95835,433,06043LAKE RESOURCES NLNotes to the financial statementsfor the year ended 30 June 2021Note 14. Equity -issued capital (continued)a)Movements in share capital(continued)DetailsDateOrdinary sharesPrice per share $2021$Opening balance671,461,95835,433,060Issue of shares -Placement01-Sep-2085,666,667 0.0302,570,000 Conversion of Performance rights (vested April 2020)31-Aug-205,000,000 - -Shares issued under CPA01-Sep-2015,000,000 0.033495,000 Shares issued under CPA24-Sep-2015,000,000 0.060900,000 Shares issuedto expand CPA agreement27-Nov-2025,000,000 --Shares issued under CPA14-Dec-209,000,000 0.046414,000 Shares issued under CPA20-Jan-2140,000,000 0.0843,375,000 Issue of shares -SBI options20-Jan-21710,900 0.08460,000 Issue of shares -Placement20-Jan-219,300,000 0.046427,800 Issue of shares -Placement27-Jan-215,555,000 0.080444,400 Issue of shares -Placement29-Jan-2150,000 0.1658,250 Issue of shares -Share Purchase Plan28-Jan-21125,000,000 0.16520,625,000 Listed options exerciseJan –June 2151,332,803 0.1005,133,280 Capital raising costs -cash--(1,511,372)Capital raising costs –options issued to brokers --(2,625,776)Movement for the period386,615,370 30,315,582 Balance 30 June 20211,058,077,32765,748,642 Ordinary sharesOrdinary shares entitle the holder to participate in dividends and the proceeds on the winding up of the Consolidated entity in proportion to the number of and amounts paid on the shares held. The fully paid ordinary shares have no par value and the Consolidated entity does not have a limited amount of authorised capital.On a show of hands every member present at a meeting in person or by proxy shall have one vote and upon a poll each share shall have one vote.Reconciliation of movements in share capital to proceeds from issue of shares, net of transaction costs:$Issue of shares net of issue costs30,315,582 Deduct shares in lieu of payments:Share based payments (Note27)(108,931)Equity settled loan repayments (note 12)(32,500)Add backOptions issued as issue costs (Note 27)2,625,776 Proceeds from issue of shares, net of transaction costs32,799,927 44LAKE RESOURCES ANNUAL REPORT 202152 LAKE RESOURCES NLNotes to the financial statementsfor the year ended 30 June 2021Note 14. Equity - issued capital (continued)b)Share basedpaymenttransactions in share capital movementsIssues of share capital and certain share issue cost during the year included the equity-settled share-based payment transactions for the payment for fees and of servicesas detailed in Note 27.c)Performance rightsMovements in Performance Rights were as follows:Grant dateExpiry dateBalance at the start of the year GrantedConverted to SharesBalance at the end of the yearVested during yearbut not converted202115-Aug-1915-Aug-2415,000,000-(5,000,000)10,000,000 -202015-Aug-1915-Aug-24-15,000,000-15,000,0005,000,000The terms and conditions of performance rights on issue at 30 June 2021 affecting remuneration of directors and other key management personnel in this financial year or future reporting years are as follows:Grant DateExpiry dateNo of RightsPerformance HurdlePerformance achievedNo.vested15-Aug-201915-Aug-242,500,000Pilot plant125%-15-Aug-201915-Aug-247,500,000Investor25%-Total10,000,0005,000,000 1Pilot Plant: A Pilot Plant is established on-site at the Kachi Project in Catamarca2Investor:An investment partner signs an agreement to invest into the Kachi Project in Catamarcad)OptionsMovements in options were as followsNature of OptionsGrant/VestDateExpiry dateExercise priceBalance at 1 July 2020Issued Expired Unexercised Exercised Balance at 30/6/2021 Director Options30-Nov-1731-Dec-20$0.289,500,000 -(9,500,000)--Issued to SBI8-Mar-1928-Feb-22$0.085,555,000 --(5,555,000)-listed19-Aug-1915-Jun-21$0.1052,512,693 -(1,179,890)(51,332,803)-Directors16-Sep-1931-Jul-21$0.0915,000,000 - --15,000,000-Issued to BBI28-Oct-1928-Oct-22$0.0518,300,000 --(18,300,000)-Roth options09-Mar-2109-Mar-23$0.30-62,500,000--62,500,000Roth fee options09-Mar-2109-Mar-23$0.30-11,250,000--11,250,000RothSBP options27-Jan-2109-Mar-23$0.30-1,000,000--1,000,000 Red Cloud24-Apr-2124-May-23$0.30-1,500,000--1,500,000 100,867,693 76,250,000 (10,679,890)(75,187,803)91,250,000 45LAKE RESOURCES ANNUAL REPORT 202153 LAKE RESOURCES NLNotes to the financial statementsfor the year ended 30 June 2021Note 14. Equity - issued capital (continued)b)Share basedpaymenttransactions in share capital movementsIssues of share capital and certain share issue cost during the year included the equity-settled share-based payment transactions for the payment for fees and of servicesas detailed in Note 27.c)Performance rightsMovements in Performance Rights were as follows:Grant dateExpiry dateBalance at the start of the year GrantedConverted to SharesBalance at the end of the yearVested during yearbut not converted202115-Aug-1915-Aug-2415,000,000-(5,000,000)10,000,000 -202015-Aug-1915-Aug-24-15,000,000-15,000,0005,000,000The terms and conditions of performance rights on issue at 30 June 2021 affecting remuneration of directors and other key management personnel in this financial year or future reporting years are as follows:Grant DateExpiry dateNo of RightsPerformance HurdlePerformance achievedNo.vested15-Aug-201915-Aug-242,500,000Pilot plant125%-15-Aug-201915-Aug-247,500,000Investor25%-Total10,000,0005,000,000 1Pilot Plant: A Pilot Plant is established on-site at the Kachi Project in Catamarca2Investor:An investment partner signs an agreement to invest into the Kachi Project in Catamarcad)OptionsMovements in options were as followsNature of OptionsGrant/VestDateExpiry dateExercise priceBalance at 1 July 2020Issued Expired Unexercised Exercised Balance at 30/6/2021 Director Options30-Nov-1731-Dec-20$0.289,500,000 -(9,500,000)--Issued to SBI8-Mar-1928-Feb-22$0.085,555,000 --(5,555,000)-listed19-Aug-1915-Jun-21$0.1052,512,693 -(1,179,890)(51,332,803)-Directors16-Sep-1931-Jul-21$0.0915,000,000 - --15,000,000-Issued to BBI28-Oct-1928-Oct-22$0.0518,300,000 --(18,300,000)-Roth options09-Mar-2109-Mar-23$0.30-62,500,000--62,500,000Roth fee options09-Mar-2109-Mar-23$0.30-11,250,000--11,250,000RothSBP options27-Jan-2109-Mar-23$0.30-1,000,000--1,000,000 Red Cloud24-Apr-2124-May-23$0.30-1,500,000--1,500,000 100,867,693 76,250,000 (10,679,890)(75,187,803)91,250,000 45LAKE RESOURCES NLNotes to the financial statementsfor the year ended 30 June 2021Note 14. Equity - issued capital (continued)e)Capital risk managementExploration companies such as Lake Resources NL are funded primarily by share capital. The Consolidated entity’s capital comprises share capital supported by financial assets and financial liabilities.Management controls the capital of the Consolidated entityto ensure it can fund its operations and continue as a going concern. Capital management policy is to fund exploration activities by way of equity. No dividend will be paid whilst the Consolidated entity isin its exploration stage. There are no externally imposed capital requirements.Note 15. Equity - reservesConsolidated20212020$$Capital profits reserve4,997 4,997 Options reserve2,625,776 2,379,932 Performance rights reserve345,000 345,000 Foreign currency translation reserve388,818613,970 Total equity reserves3,364,5913,343,899 a)CapitalprofitsreserveThecapital profits reserve records non-taxable profits onsale of investmentsb)Option reserveThe optionreserve is to recognise the fair value of options issued for share based payment toemployees and serviceproviders in relation to the supply of goods or services. Once options in a serieshave all been exercised or have expired, the reserve related to those options is transferred to accumulatedlosses.c)Performance rightsreserveThe performance rights reserve is to recognise the fair valueof performance rights issued to employeesand vendors inrelation to the supply ofgoods or services.Onceall performance rights in the series havevested orhave expired, the reserve related to those options is transferred to accumulated losses.d)Foreign currency translation reserveThe foreign currency translation reserve recognises exchange differences arising from the translationof the financial statements of foreign operations to Australian dollars.46LAKE RESOURCES ANNUAL REPORT 202154 LAKE RESOURCES NLNotes to the financial statementsfor the year ended 30 June 2021Note 15. Equity –reserves(continued)e)Movements in reservesMovements in each class of reserve during thecurrent and previous financial yearareset out below:Capital profit reserveOption reservePerformance rights reserveForeign currency translation reserveTotal$$$$$Balance at 1 July20204,997 2,379,932 345,000 613,970 3,343,899Issued to brokers –capital raising-2,625,776--2,625,776Transfer from option reserve to accumulated losses on broker options expiry/exercise-(2,379,932)--(2,379,932)Translation of foreign operations---(225,152)(225,152)Balance at 30 June 20214,997 2,625,776 345,000 388,8183,364,591Balance at 1 July20194,997 1,503,023 -471,2141,979,234 Share-based payments -issued to lenders-391,058--391,058 Share-based payments -Director options-485,851--485,851 Share-based payments -Director performance rights- -345,000 -345,000Translation of foreign operations---142,756 142,756Balance at 30 June 20204,997 2,379,932 345,000 613,970 3,343,899 Note 16. Equity - accumulated lossesConsolidated20212020$$Accumulated losses at the beginning of the financial year(21,727,672)(16,824,776)Loss after income tax expense for the year(2,894,223)(4,902,896)Transfer from options reserve2,379,933-Accumulated losses at the end of the financial year(22,241,962)(21,727,672)Note 17. Equity - dividendsThere were no dividends paid,recommended ordeclared during the currentorprevious financial year.Note 18.Financial InstrumentsFinancial risk management objectivesTheConsolidated entity's activitiesexpose it to a variety of financial risks: market risk (including foreign currency risk,pricerisk and interest rate risk), credit risk and liquidity risk.The Consolidated entity'soverall risk management programfocusesonthe unpredictabilityof financial markets and seeks to minimise potential adverse effectsonthe financialperformance oftheConsolidated entity. The Consolidated entityuses different methods to measure different typesof risk to which it isexposed. Risk management is carried out bythe Boardof Directors('the Board'). These policies include identification andanalysis ofthe risk exposureof the Consolidated entity and appropriateprocedures, controls and risk limits.47LAKE RESOURCES ANNUAL REPORT 202155 LAKE RESOURCES NLNotes to the financial statementsfor the year ended 30 June 2021Note 15. Equity –reserves(continued)e)Movements in reservesMovements in each class of reserve during thecurrent and previous financial yearareset out below:Capital profit reserveOption reservePerformance rights reserveForeign currency translation reserveTotal$$$$$Balance at 1 July20204,997 2,379,932 345,000 613,970 3,343,899Issued to brokers –capital raising-2,625,776--2,625,776Transfer from option reserve to accumulated losses on broker options expiry/exercise-(2,379,932)--(2,379,932)Translation of foreign operations---(225,152)(225,152)Balance at 30 June 20214,997 2,625,776 345,000 388,8183,364,591Balance at 1 July20194,997 1,503,023 -471,2141,979,234 Share-based payments -issued to lenders-391,058--391,058 Share-based payments -Director options-485,851--485,851 Share-based payments -Director performance rights- -345,000 -345,000Translation of foreign operations---142,756 142,756Balance at 30 June 20204,997 2,379,932 345,000 613,970 3,343,899 Note 16. Equity - accumulated lossesConsolidated20212020$$Accumulated losses at the beginning of the financial year(21,727,672)(16,824,776)Loss after income tax expense for the year(2,894,223)(4,902,896)Transfer from options reserve2,379,933-Accumulated losses at the end of the financial year(22,241,962)(21,727,672)Note 17. Equity - dividendsThere were no dividends paid,recommended ordeclared during the currentorprevious financial year.Note 18.Financial InstrumentsFinancial risk management objectivesTheConsolidated entity's activitiesexpose it to a variety of financial risks: market risk (including foreign currency risk,pricerisk and interest rate risk), credit risk and liquidity risk.The Consolidated entity'soverall risk management programfocusesonthe unpredictabilityof financial markets and seeks to minimise potential adverse effectsonthe financialperformance oftheConsolidated entity. The Consolidated entityuses different methods to measure different typesof risk to which it isexposed. Risk management is carried out bythe Boardof Directors('the Board'). These policies include identification andanalysis ofthe risk exposureof the Consolidated entity and appropriateprocedures, controls and risk limits.47LAKE RESOURCES NLNotes to the financial statementsfor the year ended 30 June 2021Note 18.Financial Instruments (continued)Foreign currency riskThe Consolidated entityundertakes certain transactions denominated in foreign currency and is exposed to foreign currency risk through foreign exchange rate fluctuations.Foreign exchange risk arises from future commercial transactions and recognised financial assets and financial liabilities denominated in a currency that is not the entity's functional currency.In order to protect against adverse exchange rate movements, the Consolidated entityhas set up foreign bank accounts inUSDand ARSwhich areused to fund its exploration activities in Argentina.The carrying amount of the Consolidated entity's foreign currency denominated financial assets at the reporting date were as follows, expressedin AUDAssetsLiabilities2021202020212020$$$$US dollars 7,790,8424,16578,505 42,288Pound Sterling --51,15953,723Canadian dollars --21,539-Argentinian pesos 29,696 192350,185 205,862 Total 7,820,5384,357501,388 301,873 A sensitivity analysis of the movement in exchange rate (basedon the closing balance of the asset) is presented below:Consolidated 2021AUD strengthen by 1%AUD weaken by 1%Impact on Impact onProfit before taxEquityProfit before taxEquityUSD assets77,908-(77,908)-USD liabilities(785)-785 -GBP liabilities(512)-512 -CAD liabilities--215 -ARS liabilities(3,502)-3,502-ARS assets297 -(297)73,406-(73,406)-Consolidated 2020USD assets42-(42)-USD liabilities(423)-423-GBP liabilities(537)-537-ARS liabilities(2,059)-2,059-ARS assets2 -(3)-(2,975)-2,975-Price riskThe Consolidated entity is not exposed to any significant price risk.48LAKE RESOURCES ANNUAL REPORT 202156 LAKE RESOURCES NLNotes to the financial statementsfor the year ended 30 June 2021Note 18.Financial Instruments (continued)Interest rate riskCurrently the Consolidated entity does not have any external borrowings subject to variable rates and thereforehas minimal interest rate risk.Credit riskGenerally, other trade receivables are written off when there is no reasonable expectation of recovery. Indicators of this include the failure of a debtor to engage in a repayment plan, no active enforcement activity and a failure to make contractual payments for a period greater than 1 year.The Consolidated entitydeemed its credit risk to be minimal as its financial assets are mainly cash held at financial institutionswith credit risk ratings of Aa3 (Moody’s) and AA- (Standard and Poors)Major bank used is NAB Argentine banks do not hold sufficient cash to pose a material credit risk to the company. Liquidity riskVigilant liquidity risk management requires the Consolidated entityto maintain sufficient liquid assets (mainly cash and cash equivalents) and available borrowing facilities to be able to pay debts as and when they become due and payable.The Consolidated entitymanages liquidity risk by maintaining adequate cash reserves and available borrowing facilities by continuously monitoring actual and forecast cash flows and matching the maturity profiles of financial assets and liabilities. The Consolidated entityonly deposit its cash and cash equivalent with the major banks inAustraliaRemaining contractual maturitiesThe following tables detail the Consolidated entity's remaining contractual maturity for its financial instrument liabilities. The tables have been drawn up based on the undiscounted cash flows of financial liabilities based on the earliest date on which the financial liabilities are required to be paid. The tables include both interest and principal cash flows disclosed as remaining contractual maturities and therefore these totals may differ from their carrying amount in the statement of financial position.Weighted average interest rate<1 year1 -2 years2 -5 years>5 yearsRemainingcontractual maturitiesConsolidated -2021%$$$$$Non-derivativesNon-interest bearingOther payables-790,551---790,551 Total non-derivatives-790,551 - --790,551 49LAKE RESOURCES ANNUAL REPORT 202157 LAKE RESOURCES NLNotes to the financial statementsfor the year ended 30 June 2021Note 18.Financial Instruments (continued)Interest rate riskCurrently the Consolidated entity does not have any external borrowings subject to variable rates and thereforehas minimal interest rate risk.Credit riskGenerally, other trade receivables are written off when there is no reasonable expectation of recovery. Indicators of this include the failure of a debtor to engage in a repayment plan, no active enforcement activity and a failure to make contractual payments for a period greater than 1 year.The Consolidated entitydeemed its credit risk to be minimal as its financial assets are mainly cash held at financial institutionswith credit risk ratings of Aa3 (Moody’s) and AA- (Standard and Poors)Major bank used is NAB Argentine banks do not hold sufficient cash to pose a material credit risk to the company. Liquidity riskVigilant liquidity risk management requires the Consolidated entityto maintain sufficient liquid assets (mainly cash and cash equivalents) and available borrowing facilities to be able to pay debts as and when they become due and payable.The Consolidated entitymanages liquidity risk by maintaining adequate cash reserves and available borrowing facilities by continuously monitoring actual and forecast cash flows and matching the maturity profiles of financial assets and liabilities. The Consolidated entityonly deposit its cash and cash equivalent with the major banks inAustraliaRemaining contractual maturitiesThe following tables detail the Consolidated entity's remaining contractual maturity for its financial instrument liabilities. The tables have been drawn up based on the undiscounted cash flows of financial liabilities based on the earliest date on which the financial liabilities are required to be paid. The tables include both interest and principal cash flows disclosed as remaining contractual maturities and therefore these totals may differ from their carrying amount in the statement of financial position.Weighted average interest rate<1 year1 -2 years2 -5 years>5 yearsRemainingcontractual maturitiesConsolidated -2021%$$$$$Non-derivativesNon-interest bearingOther payables-790,551---790,551 Total non-derivatives-790,551 - --790,551 49LAKE RESOURCES NLNotes to the financial statementsforthe yearended 30 June 2021Note 18.Financial Instruments (continued)Consolidated - 2020Weighted average interest rate<1 year1 - 2 years2 - 5 years>5yearsRemaining contractual maturitiesNon-derivativesNon-interest bearingOther payables-664,135---664,135Total non-derivatives-664,135- --664,135The cash flows in the maturity analysis above arenot expected to occur significantly earlier than contractually disclosed above.Fair value of financial instrumentsUnless otherwise stated, the carrying amounts of financial instruments reflect their fair valueNote 19.Key management personnel disclosuresThe aggregatecompensation made to directors and other members of key management personnel of the Consolidated entityis set out below Consolidated20212020$$Short term benefits945,604 662,029 Post-employment benefits(superannuation)33,835 24,530 Long service leave27,998 -Share-based payments-830,851Total1,007,4371,517,410 Note 20. Remuneration of auditorsDuring the financial year the following feeswere paidor payable for services provided byBDOAudit Pty Ltd, theauditorof the Consolidated entityConsolidated20212020$$Audit Services Audit or review of the financial statements BDO Audit Pty Ltd (2021 financial year) 53,000-Stanley & Williamson (2020 financial year) -43,100No non-audit services were provided during either financial year by either auditor. 50LAKE RESOURCES ANNUAL REPORT 202158 LAKE RESOURCES NLNotes to the financial statementsfor the year ended 30 June 2021Note 21. Related party transactionsParent entityLake Resources NL is the parent entity.SubsidiariesInterests in subsidiaries areset out in note 23. Key management personnelDisclosuresrelating to key management personnel are set out in note 19 and the remuneration reportincluded in thedirectors' report.Transactions withrelated partiesThe following transactions occurred with related parties:Consolidated20212020$$Payment for servicesConsultancy services provided by companies associated with Mr Stuart Crow (Director)74,10093,600Consultancy services provided by a Consolidated entity associated with Dr Nicholas Lindsay (Director)16,90052,350 91,000145,950 (Receivable from) and payable to related parties) Consultancy services and directors’ fees provided by an entity company associated with Mr Stuart Crow16,500 30,433Consultancy services provided by an entity associated with Dr Nicholas Lindsay (Director)21,064 12,650 Net advances to Mr Stephen Promnitz (142,249)(72,038)(104,685)(28,955)Terms and conditionsAll transactions were made on normal commercial terms and conditions and at marketrates. Disclosures relating to the advance to Mr Promnitz:•The transactions were for amounts of between $1,500 and $15,000•The outstanding balance at 30 June 2021 was $142,249 (2020: $72,038)•The terms and conditions of the advances: to be finalised prior to end Dec 2021,unsecured, nopersonal guarantees•No provision for collectability has been recognise nor bad debt expense raised.51LAKE RESOURCES ANNUAL REPORT 202159 LAKE RESOURCES NLNotes to the financial statementsfor the year ended 30 June 2021Note 21. Related party transactionsParent entityLake Resources NL is the parent entity.SubsidiariesInterests in subsidiaries areset out in note 23. Key management personnelDisclosuresrelating to key management personnel are set out in note 19 and the remuneration reportincluded in thedirectors' report.Transactions withrelated partiesThe following transactions occurred with related parties:Consolidated20212020$$Payment for servicesConsultancy services provided by companies associated with Mr Stuart Crow (Director)74,10093,600Consultancy services provided by a Consolidated entity associated with Dr Nicholas Lindsay (Director)16,90052,350 91,000145,950 (Receivable from) and payable to related parties) Consultancy services and directors’ fees provided by an entity company associated with Mr Stuart Crow16,500 30,433Consultancy services provided by an entity associated with Dr Nicholas Lindsay (Director)21,064 12,650 Net advances to Mr Stephen Promnitz (142,249)(72,038)(104,685)(28,955)Terms and conditionsAll transactions were made on normal commercial terms and conditions and at marketrates. Disclosures relating to the advance to Mr Promnitz:•The transactions were for amounts of between $1,500 and $15,000•The outstanding balance at 30 June 2021 was $142,249 (2020: $72,038)•The terms and conditions of the advances: to be finalised prior to end Dec 2021,unsecured, nopersonal guarantees•No provision for collectability has been recognise nor bad debt expense raised.51LAKE RESOURCES NLNotes to the financial statementsfor the year ended 30 June 2021Note 22. Parent entity informationSet out below is the supplementary information about the parent entity.Statement of profit or loss and other comprehensive incomeParent20212020$$Loss after income tax(7,056,369)(4,771,463)Total comprehensive income(7,056,369)(4,628,707)ParentStatementoffinancialposition:20212020$$Total current assets25,772,480 280,768 Total assets47,567,73418,817,694 Total current liabilities668,465 458,273 Total liabilities696,463 458,273 EquityIssued capital65,748,642 35,433,060 Capital profits reserve4,997 4,997 Options reserve2,625,776 2,379,932 Performance rights reserve345,000 345,000 Accumulated losses(21,853,144)(19,803,568)Total equity46,871,27118,359,421Guarantees entered into by the parent entity in relation to the debts of its subsidiariesThe parent entity had no guarantees in relation to the debtsof its subsidiaries as at 30 June2021 and 30 June 2020. Contingent liabilitiesThe parent entity had no contingent liability asat 30 June2021 and 30 June2020. Capitalcommitments - Property, plant and equipmentThe parent entity had no capital commitments for property, plant and equipment as at30 June2021 and 30 June 2020. Significant accounting policiesTheaccounting policiesof the parent entityare consistent with those of the Consolidated entity,as disclosed in note 1, exceptforthe following •Investmentsinsubsidiariesareaccountedforatcost,lessanyimpairment,intheparententity.•Investmentsinassociatesareaccountedforatcost,lessanyimpairment,intheparententity.•Dividendsreceivedfromsubsidiariesarerecognisedasotherincomebytheparententity.52LAKE RESOURCES ANNUAL REPORT 202160 LAKE RESOURCES NLNotes to the financial statementsfor the year ended 30 June 2021Note 23. Interests in subsidiariesThe consolidated financial statements incorporate theassets, liabilities andresults of the following subsidiaries in accordancewith the accounting policy described in note 1:NamePrincipal place of business / Country of incorporationOwnership Interest20212020%%Lake Mining Pakistan (Pvt) Limited *Pakistan100%100%LithNRG Pty LtdAustralia100%100%Minerales Australes SA **Argentina100%100%Morena del Valle Minerals SA **Argentina100%100%Lake Resources CRN Pty Ltd ***Australia100%100%Petra Energy SAArgentina100%100%*The subsidiary was incorporated on 4 December 2014. The subsidiary has share capital consisting solely of ordinary shareswhich are held directly by the Consolidated entity. The proportion of ownership interests held equals the voting rights held bythe Consolidated entity. The subsidiary's principal place of business is also its country of incorporation.**Interest is held through LithNRG Pty Ltd.LithNRG’ sinterest in Morena del Valles willbe transferred to KLPL following itsincorporation(refer below).*** Entity created solely as the holder of the Consolidated entityissued Convertible Notes in December 2018, and since then, allNotes have been repaid. The entity is dormant at present.Kachi Lithium Pty Ltd(KLPL)was incorporated on 26 August 2021 as a wholly owned subsidiary of LithNRG Pty Ltd. KLPL will be the vehicle through which the Kachi Project will operate and will be the owner of the shares of Morena del Valle Minerals. Under the agreement with Lilac, that company has the ability to earn up to 25% of the ownership of KLPL.Note 24. Events after the reporting periodSubsequent to the end of the financial year, the Consolidated entity raised a further $42,890,670through the conversion of unlisted options, which included 14,000,000 Director options with an exercise price of $0.09 (expiry July 2021) and 124,784,861unlisted options with exercise prices of A$0.30 and A$0.35.On the 28 July 2021 the Consolidated entityannounced a pro-rata non-renounceable issue to Eligible Shareholders of one free Bonus Option for every ten Shares held on the Record Date of 24 August 2021 (Bonus Option Offer), and for the issue to Eligible Option holders of one further free Additional Option for every Bonus Option exercised prior to the Bonus Option Expiry Date of 15 October 2021 (Additional Option Offer). Each Bonus Option gives Eligible Shareholders the opportunity, but not the obligation, to subscribe for an additional Share inthe Company at the Exercise Price of $0.35 per Bonus Option before 5:00pm on the Bonus Option Expiry Date (15 October 2021). Each Additional Option gives Eligible Option holders the opportunity, but not the obligation, to subscribe for an additional Sharein the Company at the Exercise Price of $0.75 per Additional Option before 5:00pm on the Additional Option Expiry Date (15 June 2022).On 30 August 2021, 110,416,119 Bonus Options were issued at the Exercise Price of $0.35 per Bonus Option and an Expiry Date of 15 October 2021. As at 28 October, 83,904,236 options had been converted raising a further $29,366,483 millionOn 22 September 2021, the Consolidated entity announced that it had formally partnered with Lilac for the technology and funding to develop the Kachi Project). Under the agreement, Lilac will contribute technology, engineering teams, and an on-site demonstration plant, earning in to a maximum 25% stake in Lake’s Kachi project based on performance-based milestones. Lilac, after earning its interest in Kachi, will be expected to fund approximately US$50 million, equivalent to its pro rata share of future development costs - aligning innovation, funding, development, and production. Lilac can earn in to Kachi in the following stages:53LAKE RESOURCES ANNUAL REPORT 202161 LAKE RESOURCES NLNotes to the financial statementsfor the year ended 30 June 2021Note 23. Interests in subsidiariesThe consolidated financial statements incorporate theassets, liabilities andresults of the following subsidiaries in accordancewith the accounting policy described in note 1:NamePrincipal place of business / Country of incorporationOwnership Interest20212020%%Lake Mining Pakistan (Pvt) Limited *Pakistan100%100%LithNRG Pty LtdAustralia100%100%Minerales Australes SA **Argentina100%100%Morena del Valle Minerals SA **Argentina100%100%Lake Resources CRN Pty Ltd ***Australia100%100%Petra Energy SAArgentina100%100%*The subsidiary was incorporated on 4 December 2014. The subsidiary has share capital consisting solely of ordinary shareswhich are held directly by the Consolidated entity. The proportion of ownership interests held equals the voting rights held bythe Consolidated entity. The subsidiary's principal place of business is also its country of incorporation.**Interest is held through LithNRG Pty Ltd.LithNRG’ sinterest in Morena del Valles willbe transferred to KLPL following itsincorporation(refer below).*** Entity created solely as the holder of the Consolidated entityissued Convertible Notes in December 2018, and since then, allNotes have been repaid. The entity is dormant at present.Kachi Lithium Pty Ltd(KLPL)was incorporated on 26 August 2021 as a wholly owned subsidiary of LithNRG Pty Ltd. KLPL will be the vehicle through which the Kachi Project will operate and will be the owner of the shares of Morena del Valle Minerals. Under the agreement with Lilac, that company has the ability to earn up to 25% of the ownership of KLPL.Note 24. Events after the reporting periodSubsequent to the end of the financial year, the Consolidated entity raised a further $42,890,670through the conversion of unlisted options, which included 14,000,000 Director options with an exercise price of $0.09 (expiry July 2021) and 124,784,861unlisted options with exercise prices of A$0.30 and A$0.35.On the 28 July 2021 the Consolidated entityannounced a pro-rata non-renounceable issue to Eligible Shareholders of one free Bonus Option for every ten Shares held on the Record Date of 24 August 2021 (Bonus Option Offer), and for the issue to Eligible Option holders of one further free Additional Option for every Bonus Option exercised prior to the Bonus Option Expiry Date of 15 October 2021 (Additional Option Offer). Each Bonus Option gives Eligible Shareholders the opportunity, but not the obligation, to subscribe for an additional Share inthe Company at the Exercise Price of $0.35 per Bonus Option before 5:00pm on the Bonus Option Expiry Date (15 October 2021). Each Additional Option gives Eligible Option holders the opportunity, but not the obligation, to subscribe for an additional Sharein the Company at the Exercise Price of $0.75 per Additional Option before 5:00pm on the Additional Option Expiry Date (15 June 2022).On 30 August 2021, 110,416,119 Bonus Options were issued at the Exercise Price of $0.35 per Bonus Option and an Expiry Date of 15 October 2021. As at 28 October, 83,904,236 options had been converted raising a further $29,366,483 millionOn 22 September 2021, the Consolidated entity announced that it had formally partnered with Lilac for the technology and funding to develop the Kachi Project). Under the agreement, Lilac will contribute technology, engineering teams, and an on-site demonstration plant, earning in to a maximum 25% stake in Lake’s Kachi project based on performance-based milestones. Lilac, after earning its interest in Kachi, will be expected to fund approximately US$50 million, equivalent to its pro rata share of future development costs - aligning innovation, funding, development, and production. Lilac can earn in to Kachi in the following stages:53LAKE RESOURCES NLNotes to the financial statementsfor the year ended 30 June 2021Note 24.Events after the reporting period(continued)Stage 1: Lilac will earn 10% project equity on committing to fund at its cost the completion of testing of its technology for the Kachi project in accordance with an agreed timeline.Stage 2: Lilac will earn a further 10% on satisfying all agreed testing criteria using the demonstration plant at the Kachi Project in accordance with an agreed timeline.Stage 3: Lilac may earn a further 5% on refined lithium chemical product from Kachi achieving the highest agreed qualification standards with certain potential offtake partners.Other Key Terms:Lilac will provide technology services and its proprietary ion-exchange materials for the life of the project, subject to meeting the testing criteria and certain agreements being finalized and entered into. Both Lake and Lilac will have pre-emptive rights in respect of each other’s interests. Lake has certain buy back rights if Lilac does not meet agreed testing criteria or if an acceptable services agreement cannot be agreed with Lilac within an agreed timeline.On 11 August 2021 the Consolidated entityannounced that the UK Export Finance (UKEF), the Export Credit Agency (ECA) of the United Kingdom, had provided a strong Expression of Interest to support approximately 70%of the total finance required for Lake’s Kachi Project, subject to standard project finance terms, including, among others, suitable structured offtake contracts, the successful completion of Kachi’s Definitive Feasibility Study (DFS), and an Environmental and Social Impact Assessment (ESIA) to Equator Principles. The ECA led project finance would deliver a significantly lower cost of capital than traditional financing structures, with the principal repaid over an 8.5-year period post-construction. UKEF indicated that debt finance is available to support expanded production to 51,000 tpa of high purity lithium carbonate equivalent. UKEF’s Expression of Interest will encourage a UK-led sourcing strategy while allowing flexibility for other leading ECAs to participate. On 28 September 2021 Canada’s Export Credit Agency, EDC, provided a Letter of Interest to potentially work alongside UKEF to support approximately 70% of the total finance required for Lake’s Kachi Project, subject to similar standard project finance terms as UKEF EDC indicated the ability to provide direct lending to the project up to US$100 million, subject to sourcing requirements. Such direct lending would be at the attractive OECD Fixed Commercial Interest Reference Rate (“CIRR”) applicableat the date of signing, which is currently 1.77% fixed.No other matter or circumstance has arisen since 30 June 2021 that has significantly affected, or may significantly affect the Consolidated entity's operations, the results of those operations, or the Consolidated entity's state of affairs in future financial years. .54LAKE RESOURCES ANNUAL REPORT 202162 LAKE RESOURCES NLNotes to the financial statementsfor the year ended 30 June 2021Note 25.Cashflow Statement Reconciliationsa)Reconciliation of loss after income tax to net cash used in operating activitiesConsolidated20212020$$Loss after income tax expense for the year(2,894,223)(4,902,896)Adjustments for:Depreciation and amortisation337881 Exploration expenditure impaired301,700 -Share-based payments(non cash)108,931 1,850,492 Financing expenses -465,783Financial asset impaired(146,352)-Tax expense for VAT not recoverable-44,021Change in operating assets and liabilities: Increase in trade and other receivables26,763 (50,669)Increase/(decrease) in provisions100,779Increase in other current assets(161,961)54,687 Increase/(decrease) in trade and other payables236,079 49,403 Net cash used in operating activities(2,432,982)(2,488,298)b)Reconciliation of movement in financing activities to net cash from financing activities(i)Reconciliation of movements in share capital to proceeds from issue of shares, net oftransaction costs:Issue of shares net of issue costs30,315,582 7,679,452Deduct shares in lieu of payments:Share based payments (Note27)(108,931)420,000Shares issued for which funds not received at year end-(112,993)Net refunds from prior year option exercises-(4,997)Convertible note conversions(1,012,085)Equity settled loan repayments (note 12)(32,500)-Add backOptions issued as issue costs (Note 27)2,625,776 -Proceeds from issue of shares, net of transaction costs32,799,927 6,129,377(ii)Reconciliation of net debtOpening balance -1,428,077Loandrawn200,0001,500,000Repayments -cash(167,500)(2,445,357)Loan service fee, interest, discount27,500529,365 Repayments by share issue(60,000)(1,012,085)Closing balance- - LAKE RESOURCES ANNUAL REPORT 202163 LAKE RESOURCES NLNotes to the financial statementsfor the year ended 30 June 2021Note 25.Cashflow Statement Reconciliationsa)Reconciliation of loss after income tax to net cash used in operating activitiesConsolidated20212020$$Loss after income tax expense for the year(2,894,223)(4,902,896)Adjustments for:Depreciation and amortisation337881 Exploration expenditure impaired301,700 -Share-based payments(non cash)108,931 1,850,492 Financing expenses -465,783Financial asset impaired(146,352)-Tax expense for VAT not recoverable-44,021Change in operating assets and liabilities: Increase in trade and other receivables26,763 (50,669)Increase/(decrease) in provisions100,779Increase in other current assets(161,961)54,687 Increase/(decrease) in trade and other payables236,079 49,403 Net cash used in operating activities(2,432,982)(2,488,298)b)Reconciliation of movement in financing activities to net cash from financing activities(i)Reconciliation of movements in share capital to proceeds from issue of shares, net oftransaction costs:Issue of shares net of issue costs30,315,582 7,679,452Deduct shares in lieu of payments:Share based payments (Note27)(108,931)420,000Shares issued for which funds not received at year end-(112,993)Net refunds from prior year option exercises-(4,997)Convertible note conversions(1,012,085)Equity settled loan repayments (note 12)(32,500)-Add backOptions issued as issue costs (Note 27)2,625,776 -Proceeds from issue of shares, net of transaction costs32,799,927 6,129,377(ii)Reconciliation of net debtOpening balance -1,428,077Loandrawn200,0001,500,000Repayments -cash(167,500)(2,445,357)Loan service fee, interest, discount27,500529,365 Repayments by share issue(60,000)(1,012,085)Closing balance- - LAKE RESOURCES NLNotes to the financial statementsfor the year ended 30 June 2021Note 26. Earnings per shareConsolidated20212020$$Loss after income tax attributable to the owners of Lake Resources NL(2,894,223)(4,902,896)NumberNumberWeighted average number of ordinary shares used in calculating basic earnings per share821,977,574564,279,901Weighted average number of ordinary shares used in calculating diluted earnings per share821,977,574564,279,901Cents Cents Basic earnings per share(0.35)(0.87)Diluted earnings per share(0.35)(0.87)Options over ordinary shares are considered potential ordinary shares. For the year ended 30 June 2021, their conversion to ordinary shares would have had the effect of reducing the loss per share. Accordingly,the options were not included in the determination of diluted earnings per share for the period. Details relating to options are set out at notes 15and 27. Subsequent to the end of the financial year, the Consolidated entityissued 138,784,861.00 shares which would have significantly changed the number of ordinary shares or potential ordinary shares outstanding at the end of the year if those transactions had occurred before the end of the year. Earnings per share for the year are not adjusted for transactions occurring after the end of the year as thetransactions do not affect the amount of capital used to produce profit or loss for the year. Details of the share issues conducted after the reporting period are included in Note 24 above.Note 27.Share-based paymentsDuring the financial year the Company equity-settled share-based payment transactions for the acquisition of goods and services, from Directors, loan providers and external supplierswere charged as follows:Consolidated20212020$$Expensed to profit or loss108,931 1,850,492 Capitalised as equity2,625,776 -Total2,734,707 1,850,492 and credited as follows:Share capital108,931 628,584 Option Reserve2,625,776 876,908 Performance Rights Reserve-345,000Total2,734,707 1,850,492 56LAKE RESOURCES ANNUAL REPORT 202164 LAKE RESOURCES NLNotes to the financial statementsfor the year ended 30 June 2021Note 27. Share-based payments(continued)a)Expensed to Profit or Loss2021During the year equity-settled share-based payment transactionsfor the payment for fees and services, expensed through profit or loss, occurred as follows:DateNumber IssuedValue per shareExpensedShares issued as paymentfor loan service fees31-Aug-20916,667$0.0327,500Shares issued as paymentfor professional services1-Sep-20381,033$0.0311,431Sharesissued as payment forprofessional services20-Jan-21710,900$0.0860,000 Sharesissued as paymentfor professional services1-Sep-20333,334$0.0310,000 Total2,341,934108,931 2020$Director Options485,850 Director Performance Shares345,000 SBI Options391,058 Suppliers628,584 1,850,492 i)Director optionsOn 15 August 2019, following the approval from the shareholders at the Company’s EGM, the Company granted 15,000,000 options over ordinary shares to the Directorsas follows:NameNumber of Options grantedGrant dateVesting and exercisable dateExpiry dateExercise PriceFair value at grant dateExpensed2020S.Promnitz5,000,000 15-Aug-1915-Aug-1931-Jul-21$0.09$0.0324161,950 S.Crow5,000,000 15-Aug-1915-Aug-1931-Jul-21$0.09$0.0324161,950 N.Lindsay5,000,00015-Aug-1915-Aug-1931-Jul-21$0.09$0.0324161,950Total 15,000,000 485,850The options vested immediately. For the year ended 30 June 2021,$ nil (2020: $485,851) was recognised as an expense in the profit or loss. 57LAKE RESOURCES ANNUAL REPORT 202165 LAKE RESOURCES NLNotes to the financial statementsfor the year ended 30 June 2021Note 27. Share-based payments(continued)a)Expensed to Profit or Loss2021During the year equity-settled share-based payment transactionsfor the payment for fees and services, expensed through profit or loss, occurred as follows:DateNumber IssuedValue per shareExpensedShares issued as paymentfor loan service fees31-Aug-20916,667$0.0327,500Shares issued as paymentfor professional services1-Sep-20381,033$0.0311,431Sharesissued as payment forprofessional services20-Jan-21710,900$0.0860,000 Sharesissued as paymentfor professional services1-Sep-20333,334$0.0310,000 Total2,341,934108,931 2020$Director Options485,850 Director Performance Shares345,000 SBI Options391,058 Suppliers628,584 1,850,492 i)Director optionsOn 15 August 2019, following the approval from the shareholders at the Company’s EGM, the Company granted 15,000,000 options over ordinary shares to the Directorsas follows:NameNumber of Options grantedGrant dateVesting and exercisable dateExpiry dateExercise PriceFair value at grant dateExpensed2020S.Promnitz5,000,000 15-Aug-1915-Aug-1931-Jul-21$0.09$0.0324161,950 S.Crow5,000,000 15-Aug-1915-Aug-1931-Jul-21$0.09$0.0324161,950 N.Lindsay5,000,00015-Aug-1915-Aug-1931-Jul-21$0.09$0.0324161,950Total 15,000,000 485,850The options vested immediately. For the year ended 30 June 2021,$ nil (2020: $485,851) was recognised as an expense in the profit or loss. 57LAKE RESOURCES NLNotes to the financial statementsfor the year ended 30 June 2021Note 27. Share-based payments(continued)ii)Performance rights issued to DirectorsOn 15 August 2019following the approval from the shareholders at the Company’sEGM, the Consolidated entity granted 15,000,000 performance rights to the then Directors as follows: Number grantedGrant dateExpirydateConverted to SharesFair valueatgrant dateExpensed2021S.Crow5,000,000 15-Aug-1915-Aug-24-$0.05814,375 S Promnitz5,000,000 15-Aug-1915-Aug-24(2,500,000)$0.058150,938 N Lindsay5,000,000 15-Aug-1915-Aug-24(2,500,000)$0.058179,687 15,000,000 (5,000,000)345,000 Directors exercised judgement in assessing that the likelihood of theremaining hurdlesfor the vesting of the performance rights had not materially changed since the prior year. Accordingly for the year ended 30 June 2021,no expense was recognised (2020: $345,000) in the profit orloss. The expense calculation recognises the probability of the performance hurdles being achieved. iii)Options issued to SBI Investments (PR), LLC (SBI) (2020)On 18 October 2019,18,300,000unlisted share options were granted to SBI for capital raising services. The options have an exercise price of 4.6 cents and an expiry date of 28 October2022. The options vested immediately on issue, and there were no other vesting conditions attached to the options. These options were recognised immediately in the profit orlossin the 2020 financial yearwith a total valuation of $391,058. No expense was recognised in the 2021 financial year. All options were exercised during the 2021 financial year.iv)Valuation MetricsThe expense for the Director options, SBI options and performance rights were determined using the Black Scholes methodology utilising the following assumptions:Director OptionsSBI OptionsPerformance RightsGrant date15-Aug-1918-Oct-1915-Aug-19Share Price at grant date$0.06$0.036$0.06Exercise (Strike) Price $0.09$0.046nilTime to Maturity (in years)235Annual Risk-Free Rate 0.90%0.90%0.90%Annualised Volatility 100%100%100%58LAKE RESOURCES ANNUAL REPORT 202166 LAKE RESOURCES NLNotes to the financial statementsfor the year ended 30 June 2021Note 27. Share-based payments (continued)v)Equity settled payments for fees and servicesShare based payment transactionsDateNumber IssuedValue per shareExpensedRedemption of SBI convertible notes*11-Feb-2011,558,021 $0.018208,584 Share based payments issued as part of placementfor loan establishment fees13-Feb-203,000,000 $0.04120,000 Share based payments issued as part of placementfor professional services27-Feb-20500,000 $0.0420,000 Share based payments issued as part of placementfor professional services13-Mar-207,000,000 $0.04280,000 22,058,021 628,584 *Thevalue of the shares issued to redeem the SBI convertible notes ($462,321) was allocated between theredemption of the notes ($253,737 or $0.022) and costs associated with the early close out of the notes($208,584 or $0.018).b)Capitalised as equityOptionsissued for capital raising servicesDuring the year 13,750,000 options were issued in three tranches for services provided in raising capital for the Company. The expenses were charged to capital raisingcosts and were determined using the Black Scholes methodology utilising the following assumptions:Tranche 1Tranche 2Tranche 3Grant / vest date09-Mar-2127-Jan-2124-May-21Share Price at grant date$0.310$0.395$0.250Exercise (Strike) Price $0.300$0.300$0.300Time to Maturity (in years)222Annual Risk-Free Rate 0.11%0.11%0.07%Annualised Volatility 119.29%110.59%120.53%Movement in options granted during the year for which expenses were charged to capital raising costs. Grant dateExpiry dateExercise priceBalance at the start of the year GrantedExpired Unexercised Exercised Balance at the end of the year202109-Mar-2109-Mar-23$0.30-11,250,000--11,250,00027-Jan-2109-Mar-23$0.30-1,000,000--1,000,000 24-Apr-2124-May-23$0.30-1,500,000--1,500,000 Totals-13,750,000--13,750,00059LAKE RESOURCES ANNUAL REPORT 202167 LAKE RESOURCES NLNotes to the financial statementsfor the year ended 30 June 2021Note 27. Share-based payments (continued)v)Equity settled payments for fees and servicesShare based payment transactionsDateNumber IssuedValue per shareExpensedRedemption of SBI convertible notes*11-Feb-2011,558,021 $0.018208,584 Share based payments issued as part of placementfor loan establishment fees13-Feb-203,000,000 $0.04120,000 Share based payments issued as part of placementfor professional services27-Feb-20500,000 $0.0420,000 Share based payments issued as part of placementfor professional services13-Mar-207,000,000 $0.04280,000 22,058,021 628,584 *Thevalue of the shares issued to redeem the SBI convertible notes ($462,321) was allocated between theredemption of the notes ($253,737 or $0.022) and costs associated with the early close out of the notes($208,584 or $0.018).b)Capitalised as equityOptionsissued for capital raising servicesDuring the year 13,750,000 options were issued in three tranches for services provided in raising capital for the Company. The expenses were charged to capital raisingcosts and were determined using the Black Scholes methodology utilising the following assumptions:Tranche 1Tranche 2Tranche 3Grant / vest date09-Mar-2127-Jan-2124-May-21Share Price at grant date$0.310$0.395$0.250Exercise (Strike) Price $0.300$0.300$0.300Time to Maturity (in years)222Annual Risk-Free Rate 0.11%0.11%0.07%Annualised Volatility 119.29%110.59%120.53%Movement in options granted during the year for which expenses were charged to capital raising costs. Grant dateExpiry dateExercise priceBalance at the start of the year GrantedExpired Unexercised Exercised Balance at the end of the year202109-Mar-2109-Mar-23$0.30-11,250,000--11,250,00027-Jan-2109-Mar-23$0.30-1,000,000--1,000,000 24-Apr-2124-May-23$0.30-1,500,000--1,500,000 Totals-13,750,000--13,750,00059LAKE RESOURCES NLNotes to the financial statementsfor the year ended 30 June 2021Note 27. Share-based payments (continued)c)Movements in Options and Performance RightsSet out beloware summariesof options and performance rights granted under share-based paymentsarrangement: OptionsGrant dateExpiry dateExercise priceBalance at the start of the year GrantedExpired Unexercised Exercised Balance at the end of the year202130-Nov-1731-Dec-20$0.289,500,000 (9,500,000)-8-Mar-1928-Feb-22$0.085,555,000 (5,555,000)-16-Sep-1931-Jul-21$0.0915,000,000 15,000,00028-Oct-1928-Oct-22$0.0518,300,000 (18,300,000)-09-Mar-2109-Mar-23$0.3011,250,000 11,250,000 27-Jan-2109-Mar-23$0.301,000,000 1,000,000 24-Apr-2124-May-23$0.301,500,000 1,500,000 Totals48,355,00013,750,000 (9,500,000) (23,855,000)28,750,000 Grant dateExpiry dateExercise priceBalance at the start of the year GrantedExpired Unexercised Exercised Balance at the end of the year202014-Nov-1621-Oct-19$0.055,052,083 -(5,052,083)--30-Nov-1731-Dec-20$0.289,500,000 ---9,500,000 08-Mar-1928-Feb-22$0.085,555,000 ---5,555,000 15-Aug-1928-Feb-22$0.09-15,000,000--15,000,00016-Sep-1928-Oct-22$0.046-18,300,000--18,300,000Totals20,107,083 33,300,000 (5,052,083) -48,355,000Performance RightsGrant dateExpiry dateBalance at the start of the year GrantedConverted to SharesBalance at the end of the yearVested during yearbut not converted202115-Aug-1915-Aug-2415,000,000-(5,000,000)10,000,000 -202015-Aug-1915-Aug-24-15,000,000-15,000,0005,000,00060LAKE RESOURCES ANNUAL REPORT 202168 LAKE RESOURCES NLNotes to the financial statementsfor the year ended 30 June 2021Note 27. Share-based payments (continued)d)Options as Share Based Payments -Numbers and Weighted Average PricesNumberWeighted Ave Exercise PriceOutstanding at end of the period48,355,000 $0.110Granted during the period13,750,000 $0.300Forfeited during the period-n/aExpired during the period(9,500,000)$0.280Exercisedduringthe period(23,855,000)$0.054Outstanding at end of the period28,750,000 $0.190Exercisableat the end of the period28,750,000 $0.190e)Other information relating to Options exercised and outstanding at year end•Weightedaverage shareprice at date of exercise of optionsExercisedDates of exerciseWeighted Average PriceIssued to SBI5,555,000 27-Jan-210.415Issued to SBI9,000,000 11-Dec-200.0745Issued to SBI9,300,000 11-Jan-210.0785•The range of exercise prices for options outstanding at the end of the financial year is $0.09 -$.030•The weighted average remaining contractual life of unexpired options at 30 June 2021 is 315.3daysNote 28.Commitmentsa)Definitive Feasibility Studyand Development CostOn 8 January 2021, the Consolidated entity announced that it had approved the preparation of a Definitive Feasibility Study (DFS) for the Kachi project. Work on the DFS is expected to be completed within 12 months of the date of this report with a further approximately USD 9 million to be spent in that period. The company estimatesthe total development cost of the project at USD544 millionbased on a plant capable of producing 25,500tonnes of Lithium Carbonate per annumwith the development cost to be incurred over a 3 year period.b)Tenement Expenditure CommitmentsThe Consolidated entity has no annual spending commitments required by Government or other bodies in order to maintain the standing of the tenements. Over the next 12 months the Consolidated entity expects to spend approximately USD 1.7 million on exploration work at its Argentinian tenements. Note 29.ContingenciesTheConsolidated entity had no contingent liabilitiesasat 30 June2021 and 30 June2020.61LAKE RESOURCES ANNUAL REPORT 202169 LAKE RESOURCES NLNotes to the financial statementsfor the year ended 30 June 2021Note 27. Share-based payments (continued)d)Options as Share Based Payments -Numbers and Weighted Average PricesNumberWeighted Ave Exercise PriceOutstanding at end of the period48,355,000 $0.110Granted during the period13,750,000 $0.300Forfeited during the period-n/aExpired during the period(9,500,000)$0.280Exercisedduringthe period(23,855,000)$0.054Outstanding at end of the period28,750,000 $0.190Exercisableat the end of the period28,750,000 $0.190e)Other information relating to Options exercised and outstanding at year end•Weightedaverage shareprice at date of exercise of optionsExercisedDates of exerciseWeighted Average PriceIssued to SBI5,555,000 27-Jan-210.415Issued to SBI9,000,000 11-Dec-200.0745Issued to SBI9,300,000 11-Jan-210.0785•The range of exercise prices for options outstanding at the end of the financial year is $0.09 -$.030•The weighted average remaining contractual life of unexpired options at 30 June 2021 is 315.3daysNote 28.Commitmentsa)Definitive Feasibility Studyand Development CostOn 8 January 2021, the Consolidated entity announced that it had approved the preparation of a Definitive Feasibility Study (DFS) for the Kachi project. Work on the DFS is expected to be completed within 12 months of the date of this report with a further approximately USD 9 million to be spent in that period. The company estimatesthe total development cost of the project at USD544 millionbased on a plant capable of producing 25,500tonnes of Lithium Carbonate per annumwith the development cost to be incurred over a 3 year period.b)Tenement Expenditure CommitmentsThe Consolidated entity has no annual spending commitments required by Government or other bodies in order to maintain the standing of the tenements. Over the next 12 months the Consolidated entity expects to spend approximately USD 1.7 million on exploration work at its Argentinian tenements. Note 29.ContingenciesTheConsolidated entity had no contingent liabilitiesasat 30 June2021 and 30 June2020.61LAKE RESOURCES NLDirectors’ Declarationfor the year ended 30 June 2021In the directors' opinion: ●theattached financial statements and notes comply with the Corporations Act 2001, the AustralianAccounting Standards,theCorporations Regulations 2001 and other mandatory professional reportingrequirements.●theattached financial statements and notes comply with International Financial Reporting Standardsasissued by theInternational Accounting Standards Boardas described in note 1 to the financial statements.●the attached financial statements and notes give a true and fair viewof the Consolidated entity's financialpositionasat30June2021 and of its performance for the financial year ended on that date;and●thereare reasonable grounds to believe that the Consolidated entity will be able to pay its debts as andwhen they become dueand payable.The directors have been given the declarations requiredbysection 295A of the Corporations Act 2001.Signed in accordancewith a resolution of directors made pursuant to section 295(5)(a)of the Corporations Act 2001. On behalf of the directorsStephen PromnitzManaging Director29October 2021LAKE RESOURCES ANNUAL REPORT 2021Tel: +61 7 3237 5999 Fax: +61 7 3221 9227 www.bdo.com.au Level 10, 12 Creek St Brisbane QLD 4000 GPO Box 457 Brisbane QLD 4001 Australia INDEPENDENT AUDITOR'S REPORT To the members of Lake Resources NL Report on the Audit of the Financial Report Opinion We have audited the financial report of Lake Resources NL (the Company) and its subsidiaries (the Group), which comprises the consolidated statement of financial position as at 30 June 2021, the consolidated statement of profit or loss and other comprehensive income, the consolidated statement of changes in equity and the consolidated statement of cash flows for the year then ended, and notes to the financial report, including a summary of significant accounting policies and the directors’ declaration. In our opinion the accompanying financial report of the Group, is in accordance with the Corporations Act 2001, including: (i) Giving a true and fair view of the Group’s financial position as at 30 June 2021 and of its financial performance for the year ended on that date; and (ii) Complying with Australian Accounting Standards and the Corporations Regulations 2001. Basis for opinion We conducted our audit in accordance with Australian Auditing Standards. Our responsibilities under those standards are further described in the Auditor’s responsibilities for the audit of the Financial Report section of our report. We are independent of the Group in accordance with the Corporations Act 2001 and the ethical requirements of the Accounting Professional and Ethical Standards Board’s APES 110 Code of Ethics for Professional Accountants (including Independence Standards) (the Code) that are relevant to our audit of the financial report in Australia. We have also fulfilled our other ethical responsibilities in accordance with the Code. We confirm that the independence declaration required by the Corporations Act 2001, which has been given to the directors of the Company, would be in the same terms if given to the directors as at the time of this auditor’s report. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion. BDO Audit Pty Ltd ABN 33 134 022 870 is a member of a national association of independent entities which are all members of BDO Australia Ltd ABN 77 050 110 275, an Australian company limited by guarantee. BDO Audit Pty Ltd and BDO Australia Ltd are members of BDO International Ltd, a UK company limited by guarantee, and form part of the international BDO network of independent member firms. Liability limited by a scheme approved under Professional Standards Legislation. 70 LAKE RESOURCES ANNUAL REPORT 2021Tel: +61 7 3237 5999 Fax: +61 7 3221 9227 www.bdo.com.au Level 10, 12 Creek St Brisbane QLD 4000 GPO Box 457 Brisbane QLD 4001 Australia INDEPENDENT AUDITOR'S REPORT To the members of Lake Resources NL Report on the Audit of the Financial Report Opinion We have audited the financial report of Lake Resources NL (the Company) and its subsidiaries (the Group), which comprises the consolidated statement of financial position as at 30 June 2021, the consolidated statement of profit or loss and other comprehensive income, the consolidated statement of changes in equity and the consolidated statement of cash flows for the year then ended, and notes to the financial report, including a summary of significant accounting policies and the directors’ In our opinion the accompanying financial report of the Group, is in accordance with the Corporations (i) Giving a true and fair view of the Group’s financial position as at 30 June 2021 and of its financial performance for the year ended on that date; and (ii) Complying with Australian Accounting Standards and the Corporations Regulations 2001. declaration. Act 2001, including: Basis for opinion We conducted our audit in accordance with Australian Auditing Standards. Our responsibilities under those standards are further described in the Auditor’s responsibilities for the audit of the Financial Report section of our report. We are independent of the Group in accordance with the Corporations Act 2001 and the ethical requirements of the Accounting Professional and Ethical Standards Board’s APES 110 Code of Ethics for Professional Accountants (including Independence Standards) (the Code) that are relevant to our audit of the financial report in Australia. We have also fulfilled our other ethical responsibilities in accordance with the Code. We confirm that the independence declaration required by the Corporations Act 2001, which has been given to the directors of the Company, would be in the same terms if given to the directors as at the time of this auditor’s report. for our opinion. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis BDO Audit Pty Ltd ABN 33 134 022 870 is a member of a national association of independent entities which are all members of BDO Australia Ltd ABN 77 050 110 275, an Australian company limited by guarantee. BDO Audit Pty Ltd and BDO Australia Ltd are members of BDO International Ltd, a UK company limited by guarantee, and form part of the international BDO network of independent member firms. Liability limited by a scheme approved under Professional Standards Legislation. Key audit matters Key audit matters are those matters that, in our professional judgement, were of most significance in our audit of the financial report of the current period. These matters were addressed in the context of our audit of the financial report as a whole, and in forming our opinion thereon, and we do not provide a separate opinion on these matters. Carrying value of exploration and evaluation assets Key audit matter How the matter was addressed in our audit Refer to note 10 in the annual report. The Group carries exploration and evaluation assets as at 30 June 2021 in accordance with the Group’s accounting policy for exploration and evaluation assets. The recoverability of exploration and evaluation assets is a key audit matter due to the significance of the total balance and the level of procedures undertaken to evaluate management’s application of the requirements of AASB 6 Exploration for and Evaluation of Mineral Resources (‘AASB 6’) in light of any indicators of impairment that may be present. Our procedures included, but were not limited to the following:  Obtaining an understanding of the current status of the tenements/projects including key activities undertaken during the period;  Making enquiries of management with respect to whether any impairment indicators in accordance with AASB 6 have been identified across the Group’s exploration project;  Assessing management’s determination that exploration activities have not yet progressed to the point where the existence or otherwise of an economically recoverable mineral resource may be determined through discussions with management and review of ASX announcements and other relevant documentation;  Reviewing capitalised exploration expenditure during the period to ensure it meets the recognition criteria under AASB 6; and  Ensuring that the group has the rights to tenure and maintains the tenements in good standing. BDO Audit Pty Ltd ABN 33 134 022 870 is a member of a national association of independent entities which are all members of BDO Australia Ltd ABN 77 050 110 275, an Australian company limited by guarantee. BDO Audit Pty Ltd and BDO Australia Ltd are members of BDO International Ltd, a UK company limited by guarantee, and form part of the international BDO network of independent member firms. Liability limited by a scheme approved under Professional Standards Legislation. 71 LAKE RESOURCES ANNUAL REPORT 2021Other information The directors are responsible for the other information. The other information comprises the information in the Group’s annual report for the year ended 30 June 2021, but does not include the financial report and the auditor’s report thereon. Our opinion on the financial report does not cover the other information and we do not express any form of assurance conclusion thereon. In connection with our audit of the financial report, our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the financial report or our knowledge obtained in the audit or otherwise appears to be materially misstated. If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact. We have nothing to report in this regard. Responsibilities of the directors for the Financial Report The directors of the Company are responsible for the preparation of the financial report that gives a true and fair view in accordance with Australian Accounting Standards and the Corporations Act 2001 and for such internal control as the directors determine is necessary to enable the preparation of the financial report that gives a true and fair view and is free from material misstatement, whether due to fraud or error. In preparing the financial report, the directors are responsible for assessing the ability of the group to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the directors either intend to liquidate the Group or to cease operations, or has no realistic alternative but to do so. Auditor’s responsibilities for the audit of the Financial Report Our objectives are to obtain reasonable assurance about whether the financial report as a whole is free from material misstatement, whether due to fraud or error, and to issue an auditor’s report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with the Australian Auditing Standards will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of this financial report. A further description of our responsibilities for the audit of the financial report is located at the Auditing and Assurance Standards Board website (http://www.auasb.gov.au/Home.aspx) at: https://www.auasb.gov.au/admin/file/content102/c3/ar1_2020.pdf This description forms part of our auditor’s report. BDO Audit Pty Ltd ABN 33 134 022 870 is a member of a national association of independent entities which are all members of BDO Australia Ltd ABN 77 050 110 275, an Australian company limited by guarantee. BDO Audit Pty Ltd and BDO Australia Ltd are members of BDO International Ltd, a UK company limited by guarantee, and form part of the international BDO network of independent member firms. Liability limited by a scheme approved under Professional Standards Legislation. 72 LAKE RESOURCES ANNUAL REPORT 2021Other information Report on the Remuneration Report The directors are responsible for the other information. The other information comprises the Opinion on the Remuneration Report information in the Group’s annual report for the year ended 30 June 2021, but does not include the financial report and the auditor’s report thereon. Our opinion on the financial report does not cover the other information and we do not express any form of assurance conclusion thereon. In connection with our audit of the financial report, our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the financial report or our knowledge obtained in the audit or otherwise appears to be materially misstated. If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact. We have nothing to report in this regard. Responsibilities of the directors for the Financial Report The directors of the Company are responsible for the preparation of the financial report that gives a true and fair view in accordance with Australian Accounting Standards and the Corporations Act 2001 and for such internal control as the directors determine is necessary to enable the preparation of the financial report that gives a true and fair view and is free from material misstatement, whether due to fraud or error. In preparing the financial report, the directors are responsible for assessing the ability of the group to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the directors either intend to liquidate the Group or to cease operations, or has no realistic alternative but to do so. Auditor’s responsibilities for the audit of the Financial Report Our objectives are to obtain reasonable assurance about whether the financial report as a whole is free from material misstatement, whether due to fraud or error, and to issue an auditor’s report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with the Australian Auditing Standards will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of this financial report. A further description of our responsibilities for the audit of the financial report is located at the Auditing and Assurance Standards Board website (http://www.auasb.gov.au/Home.aspx) at: https://www.auasb.gov.au/admin/file/content102/c3/ar1_2020.pdf This description forms part of our auditor’s report. We have audited the Remuneration Report included on pages 10 to 19 of the directors’ report for the year ended 30 June 2021. In our opinion, the Remuneration Report of Lake Resources NL, for the year ended 30 June 2021, complies with section 300A of the Corporations Act 2001. Responsibilities The directors of the Company are responsible for the preparation and presentation of the Remuneration Report in accordance with section 300A of the Corporations Act 2001. Our responsibility is to express an opinion on the Remuneration Report, based on our audit conducted in accordance with Australian Auditing Standards. BDO Audit Pty Ltd R M Swaby Director Brisbane, 29 October 2021 BDO Audit Pty Ltd ABN 33 134 022 870 is a member of a national association of independent entities which are all members of BDO Australia Ltd ABN 77 050 110 275, an Australian company limited by guarantee. BDO Audit Pty Ltd and BDO Australia Ltd are members of BDO International Ltd, a UK company limited by guarantee, and form part of the international BDO network of independent member firms. Liability limited by a scheme approved under Professional Standards Legislation. BDO Audit Pty Ltd ABN 33 134 022 870 is a member of a national association of independent entities which are all members of BDO Australia Ltd ABN 77 050 110 275, an Australian company limited by guarantee. BDO Audit Pty Ltd and BDO Australia Ltd are members of BDO International Ltd, a UK company limited by guarantee, and form part of the international BDO network of independent member firms. Liability limited by a scheme approved under Professional Standards Legislation. 73 LAKE RESOURCES ANNUAL REPORT 2021SHAREHOLDER INFORMATION DISTRIBUTION OF EQUITY HOLDERS Ordinary Shares Listed Options Unlisted Options Ex price Ex price Ex price Ex price $0.30 Expiry $0.55 Expiry $0.49 Expiry $0.75 Expiry 9/3/2023 12/7/2024 1/8/2024 1/8/2025 Ex price $0.55 Expiry 31/12/2024 - - - - - - - - 9 9 - - - - - 1 1 - - - 2 2 - - - - - 1 3 5 9 - 1 1 - 1 – 1,000 1,001 – 5,000 5,001 – 10,000 10,001 – 100,000 100,001 – 9,999,999,999 Totals Holdings less than a marketable parcel 2,894 9,607 3,926 6,769 1,278 24,474 4,893 3,072 740 815 124 9,644 1,,030 5,768 Substantial Shareholders shares of the Company Voting Rights - Ordinary Shares No shareholder has lodged a substantial shareholder notice with the Company to disclose they hold 5% or more of the issued capital of the Company. Citicorp Nominees holds 9.69% of the issued On a show of hands every member present at a meeting in person or by proxy shall have one vote and upon a poll each share shall have one vote. There are no other classes of equity securities holding voting rights. TWENTY LARGEST SHAREHOLDERS at 9 DECEMBER 2021 SHAREHOLDER INFORMATION Holder Name CITICORP NOMINEES PTY LIMITED MERRILL LYNCH (AUSTRALIA) NOMINEES PTY LIMITED ACUITY CAPITAL INVESTMENT MANAGEMENT PTY LTD US REGISTER CONTROL A/C HSBC CUSTODY NOMINEES (AUSTRALIA) LIMITED BNP PARIBAS NOMS PTY LTD MR SIMON JAMES KALINOWSKI SYDNEY BUSINESS ADVISERS PTY LTD BNP PARIBAS NOMINEES PTY LTD ACF CLEARSTREAM BNP PARIBAS NOMINEES PTY LTD PARADISE MARINE PTY LTD MR DANIEL RUBEN BONAFEDE 202 LIMITED NATIONAL NOMINEES LIMITED BNP PARIBAS NOMINEES PTY LTD SIX SIS LTD HSBC CUSTODY NOMINEES (AUSTRALIA) LIMITED - A/C 2 MR ANDREW ROBERT POWELL MS AINSLEY RUTH WILLIAMS OUTBACK FORMWORK PTY LTD LEIGH MARTIN MARINE PTY LTD Shares 118,524,326 49,578,844 40,000,000 26,442,990 26,437,884 23,017,443 18,193,094 14,800,000 13,538,660 12,467,632 10,731,070 10,450,000 10,055,500 8,347,884 8,154,097 6,967,231 6,953,000 6,751,739 6,249,100 6,050,000 % 9.69% 4.05% 3.27% 2.16% 2.16% 1.88% 1.49% 1.21% 1.11% 1.02% 0.88% 0.85% 0.82% 0.68% 0.67% 0.57% 0.57% 0.55% 0.51% 0.49% Totals 423,710,494 34.62% TWENTY LARGEST LISTED OPTIONHOLDERS at 16 NOVEMBER 2021 Holder Name ACUITY CAPITAL INVESTMENT MANAGEMENT PTY LTD CITICORP NOMINEES PTY LIMITED LODGE PARTNERS PTY LTD MR SIMON JAMES KALINOWSKI HSBC CUSTODY NOMINEES (AUSTRALIA) LIMITED PARADISE MARINE PTY LTD 202 LIMITED SYDNEY BUSINESS ADVISERS PTY LTD MR DANIEL RUBEN BONAFEDE BNP PARIBAS NOMS PTY LTD BNP PARIBAS NOMINEES PTY LTD ACF CLEARSTREAM NATIONAL NOMINEES LIMITED MERRILL LYNCH (AUSTRALIA) NOMINEES PTY LIMITED BNP PARIBAS NOMINEES PTY LTD MR LUCAS JAMES CAVANAGH MR ANDREW ROBERT POWELL MR NICK LINDSAY OUTBACK FORMWORK PTY LTD MS AINSLEY RUTH WILLIAMS LEIGH MARTIN MARINE PTY LTD Totals Shares % 4,000,000 3,508,313 3,080,506 1,994,826 1,730,602 1,121,006 1,095,954 1,010,000 950,000 927,642 877,168 865,293 4.65% 4.07% 3.58% 2.32% 2.01% 1.30% 1.27% 1.17% 1.10% 1.08% 1.02% 1.01% 835,000 0.97% 793,365 689,108 667,400 650,000 631,736 613,794 550,000 0.92% 0.80% 0.78% 0.76% 0.73% 0.71% 0.64% 26,591,713 30.89% 74 LAKE RESOURCES ANNUAL REPORT 2021TWENTY LARGEST SHAREHOLDERS at 9 DECEMBER 2021 SHAREHOLDER INFORMATION Holder Name CITICORP NOMINEES PTY LIMITED MERRILL LYNCH (AUSTRALIA) NOMINEES PTY LIMITED ACUITY CAPITAL INVESTMENT MANAGEMENT PTY LTD US REGISTER CONTROL A/C HSBC CUSTODY NOMINEES (AUSTRALIA) LIMITED BNP PARIBAS NOMS PTY LTD MR SIMON JAMES KALINOWSKI SYDNEY BUSINESS ADVISERS PTY LTD BNP PARIBAS NOMINEES PTY LTD ACF CLEARSTREAM BNP PARIBAS NOMINEES PTY LTD PARADISE MARINE PTY LTD MR DANIEL RUBEN BONAFEDE 202 LIMITED NATIONAL NOMINEES LIMITED BNP PARIBAS NOMINEES PTY LTD SIX SIS LTD HSBC CUSTODY NOMINEES (AUSTRALIA) LIMITED - A/C 2 MR ANDREW ROBERT POWELL MS AINSLEY RUTH WILLIAMS OUTBACK FORMWORK PTY LTD LEIGH MARTIN MARINE PTY LTD Shares 118,524,326 49,578,844 40,000,000 26,442,990 26,437,884 23,017,443 18,193,094 14,800,000 13,538,660 12,467,632 10,731,070 10,450,000 10,055,500 8,347,884 8,154,097 6,967,231 6,953,000 6,751,739 6,249,100 6,050,000 Totals Holder Name TWENTY LARGEST LISTED OPTIONHOLDERS at 16 NOVEMBER 2021 423,710,494 34.62% Shares % ACUITY CAPITAL INVESTMENT MANAGEMENT PTY LTD CITICORP NOMINEES PTY LIMITED LODGE PARTNERS PTY LTD MR SIMON JAMES KALINOWSKI HSBC CUSTODY NOMINEES (AUSTRALIA) LIMITED PARADISE MARINE PTY LTD 202 LIMITED SYDNEY BUSINESS ADVISERS PTY LTD MR DANIEL RUBEN BONAFEDE BNP PARIBAS NOMS PTY LTD BNP PARIBAS NOMINEES PTY LTD ACF CLEARSTREAM NATIONAL NOMINEES LIMITED MERRILL LYNCH (AUSTRALIA) NOMINEES PTY LIMITED DRP> MR LUCAS JAMES CAVANAGH MR ANDREW ROBERT POWELL MR NICK LINDSAY OUTBACK FORMWORK PTY LTD MS AINSLEY RUTH WILLIAMS LEIGH MARTIN MARINE PTY LTD Totals 4,000,000 3,508,313 3,080,506 1,994,826 1,730,602 1,121,006 1,095,954 1,010,000 950,000 927,642 877,168 865,293 793,365 689,108 667,400 650,000 631,736 613,794 550,000 835,000 0.97% 26,591,713 30.89% % 9.69% 4.05% 3.27% 2.16% 2.16% 1.88% 1.49% 1.21% 1.11% 1.02% 0.88% 0.85% 0.82% 0.68% 0.67% 0.57% 0.57% 0.55% 0.51% 0.49% 4.65% 4.07% 3.58% 2.32% 2.01% 1.30% 1.27% 1.17% 1.10% 1.08% 1.02% 1.01% 0.92% 0.80% 0.78% 0.76% 0.73% 0.71% 0.64% SHAREHOLDER INFORMATION DISTRIBUTION OF EQUITY HOLDERS Ordinary Shares Listed Options Unlisted Options 1 – 1,000 1,001 – 5,000 5,001 – 10,000 10,001 – 100,000 100,001 – 9,999,999,999 Totals Holdings less than a marketable parcel 2,894 9,607 3,926 6,769 1,278 24,474 4,893 3,072 740 815 124 9,644 1,,030 5,768 Substantial Shareholders Ex price $0.30 Expiry 9/3/2023 Ex price $0.55 Expiry 12/7/2024 Ex price $0.49 Expiry 1/8/2024 Ex price $0.75 Expiry 1/8/2025 Ex price $0.55 Expiry 31/12/2024 - - - - - - - - 9 9 - - - - - 1 1 - - - 2 2 - - - - - 1 3 5 9 - 1 1 - No shareholder has lodged a substantial shareholder notice with the Company to disclose they hold 5% or more of the issued capital of the Company. Citicorp Nominees holds 9.69% of the issued shares of the Company Voting Rights - Ordinary Shares On a show of hands every member present at a meeting in person or by proxy shall have one vote and upon a poll each share shall have one vote. There are no other classes of equity securities holding voting rights. 75 LAKE RESOURCES ANNUAL REPORT 2021SSCCHHEEDDUULLEE OOFF TTEENNEEMMEENNTTSS TOTAL NUMBER TENEMENTS: 81 TOTAL AREA TENEMENTS: 222,136 Ha REF TENEMENT NAMENUMBER AREA HaINTEREST %PROVINCESTATUS OLAROZ - CAUCHARI AREA Cauchari Bajo I 2156-D-2016 Cauchari Bajo II 2157-D-2016 Cauchari Bajo III 2158-D-2016 Cauchari Bajo V 2154-D-2016 354 354 122 946 Cauchari West I 2160-D-2016 1936 Olaroz Centro II 2164-D-2016 268 Olaroz East II 2168-D-2016 2072 MASA 12 MASA 13 MASA 14 MASA 15 PASO AREA Paso III Paso VI Paso X MASA 9 MASA 16 MASA 17 MASA 18 MASA 19 MASA 20 MASA 21 MASA 22 MASA 23 2234-M-2016 2901 2235-M-2016 3000 2236-M-2016 3000 2237-M-2016 3000 2137-P-2016 2787 2140-P-2016 2208 2144-P-2016 1833 2231-M-2016 2978 2238-M-2016 2114 2239-M-2016 2891 2240-M-2016 3000 2241-M-2016 3000 2242-M-2016 3000 2243-M-2016 2815 2244-M-2016 1460 2245-M-2016 1540 100 100 100 100 100 100 100 100 100 100 100 100 100 100 100 100 100 100 100 100 100 100 100 Jujuy Granted Jujuy Granted Jujuy Granted Jujuy Granted Jujuy Granted Jujuy Application Jujuy Granted Jujuy Granted Jujuy Granted Jujuy Granted Jujuy Granted Jujuy Granted Jujuy Granted Jujuy Granted Jujuy Granted Jujuy Granted Jujuy Granted Jujuy Granted Jujuy Granted Jujuy Granted Jujuy Granted Jujuy Application Jujuy Application 17953 23 Mining leases 47579 Ha 29626 76 LAKE RESOURCES ANNUAL REPORT 2021Olaroz Centro II 2164-D-2016 268 Jujuy Application Olaroz East II 2168-D-2016 2072 OLAROZ - CAUCHARI AREA Cauchari Bajo I 2156-D-2016 Cauchari Bajo II 2157-D-2016 Cauchari Bajo III 2158-D-2016 Cauchari Bajo V 2154-D-2016 354 354 122 946 Cauchari West I 2160-D-2016 1936 2234-M-2016 2901 2235-M-2016 3000 2236-M-2016 3000 2237-M-2016 3000 2137-P-2016 2787 2140-P-2016 2208 2144-P-2016 1833 2231-M-2016 2978 2238-M-2016 2114 2239-M-2016 2891 2240-M-2016 3000 2241-M-2016 3000 2242-M-2016 3000 2243-M-2016 2815 PASO AREA MASA 12 MASA 13 MASA 14 MASA 15 Paso III Paso VI Paso X MASA 9 MASA 16 MASA 17 MASA 18 MASA 19 MASA 20 MASA 21 MASA 22 MASA 23 Jujuy Granted Jujuy Granted Jujuy Granted Jujuy Granted Jujuy Granted Jujuy Granted Jujuy Granted Jujuy Granted Jujuy Granted Jujuy Granted Jujuy Granted Jujuy Granted Jujuy Granted Jujuy Granted Jujuy Granted Jujuy Granted Jujuy Granted Jujuy Granted Jujuy Granted Jujuy Granted 100 100 100 100 100 100 100 100 100 100 100 100 100 100 100 100 100 100 100 100 100 100 100 2244-M-2016 1460 Jujuy Application 2245-M-2016 1540 Jujuy Application 23 Mining leases 47579 Ha 29626 SSCCHHEEDDUULLEE OOFF TTEENNEEMMEENNTTSS TOTAL NUMBER TENEMENTS: TOTAL AREA TENEMENTS: 81 222,136 Ha SSCCHHEEDDUULLEE OOFF TTEENNEEMMEENNTTSS TOTAL NUMBER TENEMENTS: 81 TOTAL AREA TENEMENTS: 222,136 Ha REF TENEMENT NAMENUMBER AREA HaINTEREST %PROVINCESTATUS REF TENEMENT NAMENUMBER AREA HaINTEREST %PROVINCESTATUS OTHER CATAMARCA Galan Oeste 43-M-2016 Tornado VII 48-M-2016 3167 6629 100 100 CatamarcaGranted CatamarcaGranted 2 Mining leases 9796 Ha 9796 CATAMARCA PEGMATITES 17953 CAT 1 (Petra VIII) Cateo 93-B-20161000 CAT 2 (Petra VII) Cateo 94-B-20168475 Cateo 52-B-201610000 100 CatamarcaIn Process Petra I Petra II Petra III Petra IV Cateo 51-B-20169523 Cateo 49-B-20169528 Cateo 50-B-20168939 100 100 100 100 100 CatamarcaIn Process CatamarcaIn Process CatamarcaIn Process CatamarcaIn Process CatamarcaIn Process CAT 3 (Petra VI) Cateo 95-B-201610000 100 CatamarcaIn Process CAT 4 (Petra V) Cateo 98-B-201610000 100 CatamarcaIn Process La Aguada 1 Mina 116-B-20162499 La Aguada 2 Mina 117-B-20162950 La Aguada 3 Mina 99-B-20161558 La Aguada 4 Mina 173-B-20162929 La Aguada 5 Mina 172-B-20162866 La Aguada 6 Mina 174-B-20162999 La Aguada 7 Mina 137-B-20162919 La Aguada 8 Mina 139-B-20161587 La Aguada 9 Mina 138-B-20162607 100 100 100 100 100 100 100 100 100 CatamarcaGranted CatamarcaGranted CatamarcaIn Process CatamarcaGranted CatamarcaGranted CatamarcaGranted CatamarcaGranted CatamarcaGranted CatamarcaGranted 9 Mining leases 8 exploration leases 90,379 Ha 90379 77 LAKE RESOURCES ANNUAL REPORT 2021SSCCHHEEDDUULLEE OOFF TTEENNEEMMEENNTTSS REF TENEMENT NAMENUMBER AREA HaINTEREST %PROVINCESTATUS KACHI AREA Kachi Inca 13-M-2016 Kachi Inca I 16-M-2016 Kachi Inca II 17-M-2016 Kachi Inca III 47-M-2016 Kachi Inca V 45-M-2016 Kachi Inca VI 44-M-2016 Dona Amparo I 22-M-2016 Dona Carmen 24-M-2016 Debbie I 21-M-2016 Divina Victoria I 25-M-2016 Daniel Armando 23-M-2016 Daniel Armando II97-M-2016 858 2881 2823 3354 305 110 3000 874 1501 1266 2116 1388 Escondidita 131-M-2018 373 Irene Maria Luz Maria I Maria II Maria III Morena 1 Morena 2 Morena 3 Morena 4 Morena 5 Morena 6 Morena 7 Morena 8 Morena 9 28-M-2018 34-M-2017 140-M-2018 14-M-2016 15-M-2016 72-M-2016 73-M-2016 74-M-2016 29-M-2019 97-M-2017 75-M-2016 76-M-2016 77-M-2016 30-M-2016 Morena 12 78-M-2016 Morena 13 79-M-2016 Morena 15 162-M-2017 2250 2425 889 888 1396 3025 2989 3007 2968 1415 1606 2805 2961 2822 2704 3024 2559 2312 1119 Pampa I Pampa II Pampa III Pampa IV 129-S-2013 128-M-2013 130-M-2013 477 78-M-2017 2569 Pampa 11 201-M-2018 815 Parapeto 1 133-M-2018 Parapeto 2 134-M-2018 Parapeto 3 132-M-2018 2504 1259 1892 Gold Sand I 238-M-2018 853 100 100 100 100 100 100 100 100 100 100 100 100 100 100 100 100 100 100 100 100 100 100 100 100 100 100 100 100 100 100 100 100 100 100 100 100 100 100 100 CatamarcaGranted CatamarcaGranted CatamarcaGranted CatamarcaGranted CatamarcaGranted CatamarcaGranted CatamarcaGranted CatamarcaGranted CatamarcaGranted CatamarcaGranted CatamarcaGranted CatamarcaGranted CatamarcaGranted CatamarcaGranted CatamarcaGranted CatamarcaGranted CatamarcaGranted CatamarcaGranted CatamarcaGranted CatamarcaGranted CatamarcaGranted CatamarcaGranted CatamarcaGranted CatamarcaGranted CatamarcaGranted CatamarcaGranted CatamarcaGranted CatamarcaGranted CatamarcaGranted CatamarcaGranted CatamarcaGranted CatamarcaGranted CatamarcaGranted CatamarcaGranted CatamarcaGranted CatamarcaGranted CatamarcaGranted CatamarcaGranted CatamarcaGranted 39 Mining leases 74382 Ha 74382 78 LAKE RESOURCES ANNUAL REPORT 2021SSCCHHEEDDUULLEE OOFF TTEENNEEMMEENNTTSS REF TENEMENT NAMENUMBER AREA HaINTEREST %PROVINCESTATUS Escondidita 131-M-2018 373 KACHI AREA Kachi Inca 13-M-2016 Kachi Inca I 16-M-2016 Kachi Inca II 17-M-2016 Kachi Inca III 47-M-2016 Kachi Inca V 45-M-2016 Kachi Inca VI 44-M-2016 Dona Amparo I 22-M-2016 Dona Carmen 24-M-2016 Debbie I 21-M-2016 Divina Victoria I 25-M-2016 Daniel Armando 23-M-2016 Daniel Armando II97-M-2016 Irene Maria Luz Maria I Maria II Maria III Morena 1 Morena 2 Morena 3 Morena 4 Morena 5 Morena 6 Morena 7 Morena 8 Morena 9 28-M-2018 34-M-2017 140-M-2018 14-M-2016 15-M-2016 72-M-2016 73-M-2016 74-M-2016 29-M-2019 97-M-2017 75-M-2016 76-M-2016 77-M-2016 30-M-2016 Morena 12 78-M-2016 Morena 13 79-M-2016 Morena 15 162-M-2017 Pampa I Pampa II Pampa III Pampa IV 129-S-2013 128-M-2013 130-M-2013 477 78-M-2017 2569 Pampa 11 201-M-2018 815 Parapeto 1 133-M-2018 Parapeto 2 134-M-2018 Parapeto 3 132-M-2018 2504 1259 1892 Gold Sand I 238-M-2018 853 858 2881 2823 3354 305 110 3000 874 1501 1266 2116 1388 2250 2425 889 888 1396 3025 2989 3007 2968 1415 1606 2805 2961 2822 2704 3024 2559 2312 1119 100 100 100 100 100 100 100 100 100 100 100 100 100 100 100 100 100 100 100 100 100 100 100 100 100 100 100 100 100 100 100 100 100 100 100 100 100 100 100 CatamarcaGranted CatamarcaGranted CatamarcaGranted CatamarcaGranted CatamarcaGranted CatamarcaGranted CatamarcaGranted CatamarcaGranted CatamarcaGranted CatamarcaGranted CatamarcaGranted CatamarcaGranted CatamarcaGranted CatamarcaGranted CatamarcaGranted CatamarcaGranted CatamarcaGranted CatamarcaGranted CatamarcaGranted CatamarcaGranted CatamarcaGranted CatamarcaGranted CatamarcaGranted CatamarcaGranted CatamarcaGranted CatamarcaGranted CatamarcaGranted CatamarcaGranted CatamarcaGranted CatamarcaGranted CatamarcaGranted CatamarcaGranted CatamarcaGranted CatamarcaGranted CatamarcaGranted CatamarcaGranted CatamarcaGranted CatamarcaGranted CatamarcaGranted 39 Mining leases 74382 Ha 74382 THIS PAGE HAS BEEN LEFT INTENTIONALLY BLANK. 79 LAKE RESOURCES ANNUAL REPORT 2021THIS PAGE HAS BEEN LEFT INTENTIONALLY BLANK. 80 LAKE RESOURCES ANNUAL REPORT 2021LAKE RESOURCES N.L. 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