Lake Resources NL
Annual Report 2023

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Annual Report 2023 lakeresources.com.au LAKE RESOURCES ANNUAL REPORT 2023 b CORPORATE DIRECTORY DIRECTORS Stuart Crow Non-Executive Chairman David Dickson Managing Director/CEO Howard Atkins Non-Executive Director Cheemin Bo-Linn Non-Executive Director Ana Gomez Chapman Non-Executive Director Robert Trzebski Non-Executive Director MANAGEMENT Peter Neilsen Chief Financial Officer John Freeman Chief Legal Officer & General Counsel Mark Anning Head of Legal, Australia & Company Secretary Karen Greene Senior Vice President – Investor Relations and Communications Scott Munro Senior Vice President – Technology, Strategy and Risk Sean Miller Senior Vice President, Field Development and Evaluation Amalia Sáenz Senior Vice President, Corporate Affairs & Country Manager, Argentina Gentry Brann Chief People and Administration Officer PRINCIPAL REGISTERED OFFICE AND PRINCIPAL PLACE OF BUSINESS Level 5, 126 Phillip Street Sydney NSW 2000 Tel: +61 2 9299 9690 SHARE REGISTRY Automic Pty Ltd GPO Box 5193, Sydney, NSW, 2001 Tel: 1300 288 664 AUDITOR BDO Audit Pty Ltd Level 10, 12 Creek Street Brisbane Qld 4000 SOLICITORS White & Case Level 32 525 Collins Street Melbourne VIC 3000 Australia BANKERS Citi National Australia Bank STOCK EXCHANGE LISTINGS Australian Securities Exchange (ASX code: LKE) OTCQB: LLKKF WEBSITE ADDRESS www.lakeresources.com.au 1 LAKE RESOURCES ANNUAL REPORT 2023 FY2023 HIGHLIGHTS „ Lake Resources is on „ Conditional Framework track for completion of comprehensive DFS in December 2023 for Phase 1 plant capacity of 25ktpa of battery grade lithium carbonate. „ Independent testing of Kachi lithium carbonate confirmed grades and purity greater than 99.8%. Agreements with WMC Energy and SK On in place. „ Successful production of 2,500kg of lithium carbonate equivalent (LCE) on-site at Kachi. „ Important progress towards optimal power solution. „ Kachi drilling program indicates the lithium resource is much larger than initially anticipated. „ Testing at Kachi proved viability of extraction and reinjection processes. „ Kachi operational update in June outlined clear path to battery grade lithium carbonate production in 2027 and phased expansion to target plant capacity of 50ktpa by 2030. 2 CONTENTS Message from the CEO Message from the Chair Review of Operations Directors’ Report Auditor’s Independence Declaration Consolidated Statement of Profit or Loss and other Comprehensive Income Consolidated Statement of Financial Position Consolidated Statement of Changes in Equity Consolidated Statement of Cash Flows Notes to the Consolidated Financial Statements Directors’ Declaration Independent Auditor’s Report 2023 Corporate Governance Statement Additional ASX Information Resource Estimates and Governance Schedule of Tenements 5 8 10 14 71 72 73 74 76 77 131 132 136 152 156 157 3 LAKE RESOURCES ANNUAL REPORT 2023 ABOUT LAKE RESOURCES Lake Resources NL (ASX:LKE, OTC: LLKKF) is a responsible lithium developer utilising state‑of‑the‑art ion exchange extraction technology for the production of sustainable, high-purity lithium from its flagship Kachi Project. Kachi is located in Catamarca Province in Argentina’s Lithium Triangle. Lake also has three additional early-stage projects in this region, at Cauchari, Olaroz and Paso de Jama. The ion exchange extraction technology being utilised at Kachi delivers a solution for two rising demands – high purity battery materials to drive the global energy transition, and more sustainable, responsibly-sourced materials with a low carbon footprint and significant ESG benefits. Decarbonisation will continue to drive significant lithium demand growth through the rapid adoption of renewable electricity generation and electric vehicles, yet supply is falling short of this demand. Lake is building its business to meet the growing demand for high-quality lithium needed to meet the world’s decarbonisation ambitions. 4 INNOVATIVE TECHNOLOGY PRODUCING HIGH-PURITY LITHIUM Lake’s technology partner, California- based Lilac Solutions Inc, has developed efficient and disruptive clean technology to produce sustainable high purity lithium. This approach comes with a small environmental footprint, both via compact physical infrastructure and through re-injection of the brine to its source. Lake is commercialising a new standard for project development in the lithium industry. Working with Lilac Solutions, the demonstration plant has proven highly successful - independent testing of lithium carbonate produced from the Kachi Project in Argentina has confirmed grades and purity greater than 99.8%, or battery grade. This is a new and more efficient way to refine and produce battery-grade lithium carbonate. The ion exchange technology produces a lithium-rich solution without long lead-times and environmentally disruptive evaporation pond concentration – allowing Lake to produce high-quality lithium sustainably and at scale. The chemical process for Kachi was set out clearly in the pre-feasibility study (PFS) in 2020, which Lilac participated in. Lake and Lilac are strategically aligned through a 25% project earn-in on the completion of technology testing, demonstration plant validation and end-product qualification. LOCATED IN ARGENTINA’S LITHIUM TRIANGLE Lake’s flagship Kachi Project is located in Catamarca Province within the Lithium Triangle in Argentina, one of the world’s key lithium regions – half of all global lithium resources are found in the Lithium Triangle. MESSAGE FROM THE CEO To my Fellow Shareholders, I am pleased to present Lake Resources’ FY23 Annual Report. This past financial year has been one of rapid developments for Lake Resources, with systematic progress made towards the definitive feasibility study (DFS) for our flagship Kachi project. The Phase 1 DFS is on track for completion in December 2023, as previously announced. Recent operational updates have shown the methodical and sustained progress at the Kachi site, and I want to take this opportunity to commend our team on the ground for their excellent work. At the heart of any business is its people, and I am particularly proud of this and the range of other successes the Lake team has delivered this year. This includes the recent completion of successful extraction and injection testing at Kachi, which provided important data and higher confidence for our modelling, demonstrating the viability of our extraction and injection processes to support the production of high purity battery grade lithium. This testing represents an important milestone for the project on our path to achieving the DFS. Additionally, our drilling program at Kachi has also shown the large scale and quality of the lithium-bearing brine at the site. The drilling results indicate that this resource is much larger than initially anticipated as the known lithium brine extent continues to expand laterally and vertically. This follows the earlier discovery of additional lithium-bearing brine in the planned reinjection areas to the north and south of the previously measured resource, which extends the lateral extent of the reservoir beyond previous internal estimates. We have also drilled deeper for better grades and improved our drilling performance by 40 percent this year, a testament to our industry-leading operational team on the ground. In June, we announced an operational update that reset the Kachi project, charting a credible, achievable path to battery grade lithium carbonate production beginning in 2027. The new phased approach of building two, staggered 25Ktpa plants de-risks the project execution and accelerates our time to first lithium production, with clear milestones. It also provides the expansion optionality to 50ktpa, and potentially more. As part of this reset, we also extended the project timeline and shared significantly higher project cost estimates than what had previously been projected. Understandably this news was disappointing to many of our shareholders; however, we continue to believe in the superior economics this project offers, and we are confident that this path to production will unlock value and maximise execution efficiency. Earlier this year we also announced, together with our technology partner, Lilac Solutions, the successful production of 2,500kg of lithium carbonate equivalent (LCE) at Kachi – an important milestone for the project completing the pilot phase. The successful execution of ion exchange and process flow sheet for brine to battery grade lithium carbonate conversion demonstrated commercial-scale production capability. The independent third-party testing of the lithium carbonate produced at our joint Kachi project confirmed grades and purity greater than 99.8%, or battery grade – the grade at which it can be shipped direct to manufacturers in the United States, Europe and Asia. We have also made important progress towards finalising our power framework. Our revised design includes the capability for off-grid commissioning, including an option for 100 per cent standalone solar and battery backup. We are pleased to now have this optionality to power operations at Kachi, which takes into consideration aspects of grid connection and the needs of local communities. In the past year, we announced agreements with our world- class offtake partners, Europe’s WMC Energy and Korea’s SK On. We have conditional framework agreements in place with both parties for up to 25 ktpa and a 10 percent equity investment in Lake. There is a clear, growing demand for sustainable lithium supply from a wide range of global buyers and Kachi is essential to meet this need. As lithium supply becomes an increasingly important geopolitical consideration, Lake Resources is playing a critical role in discussions related to strengthening lithium supply chains, including with regulators and policy agencies in Argentina, Australia and the United States. 5 We also expanded and reorganised our operating team to better support the technical needs of our on-the-ground developments, and to ensure we have in place the right team to execute on the next phase of Lake’s development. This experienced, well-credentialled and highly motivated management team is ready to deliver on Lake’s new strategy and accelerate the Company’s next growth phase. The team’s experience spans technical, financial and project execution, supported by our operational team who bring significant technical and construction expertise on major capital projects across the lithium sector and other extractive industries. I would like to take this opportunity to thank the entire Lake Resources team for the excellent progress made over the past year. We are excited about moving to the next phase in delivering responsible lithium supply to support the world’s energy transition. David Dickson Managing Director / CEO We were pleased to welcome Argentina’s Mining Minister, Fernanda Avila, to Australia last year for IMARC along with the many delegation members who accompanied her from across Argentina, including Catamarca. We continue to engage regularly with Argentinian officials at the Federal, State, and local levels and welcome their strong support for developing the Argentinian lithium sector and for Lake Resources. We would also like to thank the Australian and the United States governments for their strong support and ongoing engagement with Lake Resources, both through their overseas missions and in their capitals, Canberra and Washington, D.C., respectively. We are also working together with our peers in the lithium sector to help ensure a comprehensive perspective on the challenges and opportunities for increasing lithium production in the years ahead. This past financial year has seen valuable additions to our executive team. These include: „ Mark Anning as Head of Legal in Australia and Company Secretary „ Gentry Brann as Chief People and Administration Officer „ John Freeman as Chief Legal Officer and General Counsel „ Karen Greene as a Senior Vice President to lead investor relations „ Scott Munro as a Senior Vice President to lead technology relationships „ Amalia Sáenz, as a Senior Vice President to lead Corporate Affairs in Argentina 6 LAKE RESOURCES ANNUAL REPORT 2023 7 MESSAGE FROM THE CHAIR To my Fellow Shareholders, It is my pleasure to report on such an eventful year at Lake Resources, where we have made significant progress on important project milestones. Our vision is to become a growing contributor to the energy transition by producing high-purity lithium, operating sustainably, and improving lives. Fundamental to this vision is the important role of lithium in the world’s decarbonisation journey. This past financial year has also seen sector-leading experts added to our Board. This includes the addition of: „ Howard Atkins as a Non-Executive Director, bringing financial management, capital markets, foreign exchange, governance, and public company experience. Mr. Atkins has over 30 years of financial leadership experience, including 20 years serving as a CFO for organisations including Wells Fargo, New York Life Insurance Company, and Midlantic Bank Corporation. „ Dr. Cheemin Bo-Linn as a Non-Executive Director, bringing experience in ESG, governance, and the new energy sector. Dr Bo-Linn is an accomplished CEO, former Fortune 100 operations executive, and board director with over 25 years of governance expertise at private organisations and public companies across the Americas and Europe. „ Ana Gomez Chapman as a Non-Executive Director, bringing experience in critical minerals supply chains, environmental engineering, and capital markets. Ms. Chapman is a financial services executive and board director with over 28 years of investment management, capital markets and business leadership experience. She has worked and lived across the U.S., Europe, Latin America and Asia Pacific. 8 Lake’s new directors bring exceptional experience in governance and oversight and are an invaluable resource for enhancing Lake’s corporate governance structure. This is a top priority for Lake, and we are committed to further developing greater rigour around these disciplines as the Company matures. On behalf of the Board of the Company, I would like to thank Dr Nicholas Lindsay, who retired as a director in November 2022, for his significant contribution to the progress made on the development of the Kachi Project while leading the technical team. Lithium supply has consistently struggled to keep pace with demand, and the drivers behind this demand continue – including the expanding market for electric vehicles and electrified power solutions, and the lack of battery alternatives, as well as the scarcity of active lithium projects and the years-long lead times many of these projects require. We expect this demand to continue to increase. An additional factor complicating lithium supply chains is international consumption tensions – China dominates the market as a producer and consumer, driving demand by companies and countries for supply chains outside of China. Lake’s strategy is supported by these market dynamics. Direct lithium extraction (DLE) and direct lithium production (DLP) technologies are expected to accelerate the ability to scale the supply of battery grade lithium. Our processes are also more sustainable, and result in cleaner lithium by design, which is better for the environment and our neighbouring communities. The four key pillars underpinning our quality-conscious commitment to sustainability: „ Higher lithium recovery (15% higher than hardrock and 60% higher than evaporation ponds) „ Lower water usage (10x lower freshwater usage than hardrock; and 5x lower freshwater usage and 45x lower brine water usage than evaporation ponds) „ Lower land usage (7x lower than hardrock and 600x lower than evaporation ponds) „ Lower volume of solid waste (50x lower than hardrock and 55x lower than evaporation ponds) We are also working hard to build strong relationships with surrounding communities. Our long-term success goes hand-in-hand with enhancing the broader wellbeing of the communities and regions in which we operate. Local communities will benefit from access to better infrastructure, employment opportunities, and economic development, and we are committed to ensuring we work respectfully and collaboratively with the members of the communities in which we plan to operate. LAKE RESOURCES ANNUAL REPORT 2023 Maintaining the support of these communities and our social licence to operate is a key priority. Our community engagement has included holding two Public Information Meetings, in May and August – these were well-attended by the local community, and the information shared was well-received. We are focused on bringing jobs to the communities in which we operate, which in the last year has included local hires in the Carachi Pampa and El Penon communities. We are also working with provincial authorities to promote training for the community, with a focus on training programs directly related to the future construction phase at the site. Alongside this, we continue our rigorous focus on the safety and wellbeing of our employees – the health and safety of our people is integral to our operations, and we believe nothing less than zero harm is acceptable. Argentina is a key market for global lithium supply chains to support the world’s decarbonisation. Argentina’s Lithium Triangle holds ~56% of the world’s lithium reserves and the government is committed to efficiently developing the country’s lithium resources, including via investments in Argentina’s lithium sector. Lake has a large lease holding in Argentina, covering 2,200km (550,000 acres), including our flagship Kachi project, and is well-positioned to optimise its lithium assets, resources, and relationships in Argentina. We have a tremendous opportunity here and we are pleased to be taking part in the world’s decarbonisation journey. Stuart Crow Non-Executive Chairman 9 REVIEW OF OPERATIONS 1. Kachi Project At the Kachi Project in Catamarca, Lake’s flagship project, the maiden JORC-compliant mineral resource was defined with 4.4 million tonnes (Mt) of contained battery grade lithium carbonate equivalent (LCE), comprising 1 Mt LCE Indicated Resource, and 3.4 Mt LCE Inferred Resource, over the deepest part of a large basin. Lease holdings have been consolidated and expanded over an area of more than 100,000 Ha. The resource estimate for the Kachi Project was updated during the 2023 reporting period. As of 30 June 2023, the JORC-compliant mineral resource estimate is comprised of 2.9 Mt LCE as Measured and Indicated Resource and 5.2 Mt LCE as Inferred Resource (Figure 1 and Table 1). Exploration drilling conducted since the 2018 maiden resource estimation has built on previous knowledge. The ongoing hydrogeological characterization activities started in 2022 have resulted in more than 4,000 m of drilling and have led to a significantly improved understanding of both the spatial and vertical extent of lithium brine and the permeability of the reservoir materials. These recent studies have demonstrated that the resource potential within the basin is much larger than previously defined (as disclosed to investors on the Company’s website and on the ASX, including after the date of this annual report – please see https://lakeresources.com.au/investors/ asx-announcements). These results will be incorporated into the Phase 1 Definitive Feasibility Study (DFS), and ultimately, the Phase 2 DFS. The extensive hydrogeological characterization program has provided a substantive data set that has led to basin-scale and site-scale conceptual models. These conceptual models will form the basis for the ongoing hydrogeological modeling of the extraction and injection well fields for the Phase 1 DFS. A key element of site-scale conceptual model is the delineation of hydrostratigraphic units. The hydrostratigraphic units are generalized based on similar geological and hydrogeological conditions that are correlated in the resource area (see Figure 2). „ Unit A – Intercalated sand, silts and clays. High frequency of thin clay bands. Up to 200 m thickness. „ Unit B – Higher sand proportion. Interpreted as higher permeability zone, lower natural gamma ray response, located below prominent gamma peak. „ Unit C – Similar to Unit A with higher frequency of clay bands. „ Unit D – Undefined unconsolidated sediment characteristics beneath Unit C, between 400 m and the base of the basin fill, as defined by geophysics. The characteristics of this unit have not been defined, with Unit C likely to continue below 400 m being the maximum depth of drilling and testing disclosed as of June 30, 2023 (however, further drilling updates have been disclosed and may continue to be disclosed to investors on the Company’s website and the ASX after the date of this annual report – please see https://lakeresources.com.au/ investors/asx-announcements). Recent drilling further from the central resource area has intersected extensive (to 400 m) thicknesses of sands and gravels beneath ignimbrites in the south, west and north of the central resource area with higher drainable porosity and permeability. These step-out holes drilled near the limits of the previously defined north and south extents of the January 2023 Inferred Resource, K21D38 (K21) and K22D39 (K22), recorded average lithium grades of 219 milligrams per liter (mg/l) and 283 mg/l, respectively from piezometers screened from 395 to 407 m below ground surface. These drilling and laboratory lithium data, combined with the recent TEM survey, provides evidence for future definition of additional resources. These coarser grained units show relatively rapid transition from the finer grained sediments of the central resource area. 10 LAKE RESOURCES ANNUAL REPORT 2023 Figure 1: Lake Resources’ properties and drill platform locations in the Kachi Project area, showing drilling concentrated over the salar area, with the resource outlines shown. This map was disclosed and made available on the Company’s website and on the ASX in the Company’s JORC update dated June 15, 2023. No exploration or production targets, nor new estimates of inferred mineral resources, indicated mineral resources or measured mineral resources in relation to the Kachi Project are being reported in this annual report, and the mineral resources last reported in the announcement on June 15, 2023 have not materially changed since that date. 11 Figure 2: Geological cross section looking north through the Kachi Project area, shown with 4 times vertical exaggeration. Table 1: Updated resource estimate of contained lithium for the Kachi Project – as at June 30, 2023* Measured June 2023 Unit Sediment volume m3 Specific Yeld % Brine volume m3 Litres A B C 14,620,000,000 4,594,900,000 8,487,400,000 0.07 0.08 0.06 1,073,675,256 1,073,675,256,000 358,054,366 358,054,366,070 543,960,861 543,960,860,960 Total 27,702,300,000 1,975,690,483 1,975,690,483,030 Indicated June 2023 Unit Sediment volume m3 Specific Yeld % Brine volume m3 Litres A B C 5,559,400,000 1,968,900,000 3,528,700,000 0.07 0.07 0.06 401,416,477 401,416,477,000 144,809,839 144,809,838,540 225,883,379 225,883,378,840 Total 11,057,000,000 772,109,694 772,109,694,380 Li mg/l 200 222 223 210 Li mg/l 172 176 177 174 Combined Measured + Indicated Li grams Li Tonnes Tonne LCE 214,735,051,200 214,735 1,142,390 79,488,069,268 79,488 422,877 121,303,271,994 121,303 645,333 415,526,392,462 415,526 2,210,600 Li grams Li Tonnes Tonne LCE 69,043,634,044 69,044 367,312 25,486,531,583 25,487 135,588 39,981,358,055 39,981 212,701 134,511,523,682 134,512 715,601 38,759,300,000 - 2,747,800,177 2,747,800,177,410 550,037,916,143 550,038 2,926,202 Inferred June 2023 Unit Sediment volume m3 Specific Yeld % Brine volume m3 Litres A B C 35,100,000,000 8,982,700,000 20,794,000,000 0.08 0.07 0.07 2,695,188,600 2,695,188,600,000 661,907,317 661,907,316,630 1,534,617,994 1,534,617,994,000 Total 64,876,700,000 4,891,713,911 4,891,713,910,630 Li mg/l 188 201 218 199 Li grams Li Tonnes Tonne LCE 506,695,456,800 506,695 2,695,620 133,043,370,643 133,043 707,791 334,546,722,692 334,547 1,779,789 974,285,550,135 974,286 5,183,199 *This table was disclosed and made available on the Company’s website and on the ASX in the Company’s JORC update dated June 15, 2023. No exploration or production targets, nor new estimates of inferred mineral resources, indicated mineral resources or measured mineral resources in relation to the Kachi Project are being reported in this annual report, and the mineral resources last reported in the announcement on June 15, 2023 have not materially changed between that date and the end of financial year balance date, being June 30, 2023, the date of this annual report. 12 LAKE RESOURCES ANNUAL REPORT 2023 „ JORC definitions were followed for mineral resources. 3. Additional Property Updates „ The Competent Person for this Mineral Resource estimate is Andrew Fulton, MAIG. „ No internal cut-off concentration has been applied to the resource estimate. The resource is reported at a zero mg/l cut-off, given the consistent grade of the deposit. „ Paso de Jama „ Olaroz „ Ancasti „ Cauchari „ Numbers may not add due to rounding. „ Specific Yield (Sy) = Drainable Porosity „ Lithium is converted to lithium carbonate (Li2CO3) with a conversion factor of 5.32. „ The resource estimate outlined above presents lithium and lithium carbonate tonnages. Resource estimations include three separate geological and hydrogeological (hydrostratigraphic) units to 400 m depth. *See Figure 1 for the map showing the geographical area – all within the Kachi Project area - based on the materiality of the mineral resources reported in Table 1. 2. Comparison since the last reporting period The mineral resource estimate for the Kachi Project has expanded significantly since the 2022 Annual Report. The expansion of the Measured and Indicated resource and the Inferred resource are a result of large a hydrogeologic characterization program started in 2022 which continued through the 2023 financial year, and remains ongoing. The hydrogeologic characterization program has led to a significantly improved understanding of both the spatial and vertical extent of lithium brine as well as the permeability of the reservoir material. These studies demonstrated that the resource potential at the Kachi Project is larger than the defined resource reported in the Company’s 2022 annual report, and explains the material changes in the defined resource reported in this year’s annual report – see Table 2 below. The Paso de Jama Lithium Brine Project in Jujuy Province is comprised of over 59,000 hectares and initial surface geophysical surveys, passive seismic and TEM were completed in 2022. Drilling was through the end of 2022 and resulted in more than 1,700 meters of drilling with and five small diameter wells. Activities in 2023 included analyzing and processing the investigation results, performance of small-scale hydraulic tests in several wells and laboratory properties analysis for physical characteristics including drainable porosity. As at the date of this annual report, no resource has been developed for the Paso de Jama Lithium Brine Project. Activities at the more than 45,000 hectare Olaroz Lithium Brine Project were limited to permitting and community relations activities in 2023. These efforts have laid the groundwork to initiate surface geophysical studies including passive seismic and transient electromagnetic (TEM) are planned for Q4 2023 with drilling anticipated to start in 2024. The Ancasti or Catamarca Pegmatite Lithium Project, is comprised of over 90,000 hectares of leases at the early exploration stage with large pegmatite swarms in an area of past production within a 150 km long belt. After a hiatus in investigative exploration, further mineral resource exploration is planned for the 2023/24 reporting period. The Cauchari Lithium Brine Project in Jujuy Province was successfully drilled for the first time during 2019 / 2020. It demonstrated extensions of lithium brine bearing aquifers with similar high grades into Lake’s properties from the adjoining major resource projects. No further investigative drilling was undertaken in 2023. Table 2 Comparison of defined resource for the Kachi Project – 2023 and 2022 Measured (Tonnes LCE) Indicated (Tonnes LCE) Measured and Indicated (Tonnes LCE) Inferred (Tonnes LCE) Total (Tonnes LCE) Increase in Resource +2,210,600 2,210,600 -- 715,601 1,005,000 -289,399 2,926,202 1,005,000 +1,921,202 5,183,199 3,394,000 +1,789,199 8,109,401 4,400,000 +3,709,401 Year 2023 2022# #The 2022 annual report and the maiden Kachi Mineral Resource Estimate from November 2018 that forms the basis of the resource included in the 2022 Annual Report are available at www.lakeresources.com. au and www.asx.com.au. 13 Lake Resources NL Directors' report For the year ended 30 June 2023 Your Directors present their report on the Consolidated entity consisting of Lake Resources NL and the entities it controlled at the end of, or during, the year ended 30 June 2023. Directors and company secretary The following persons were 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, Executive Chairman (resigned 5 January 2023) S. Crow, Non-Executive Chairman (appointed 5 January 2023) D. Dickson, Managing Director and Chief Executive Officer (appointed 15 September 2022) N. Lindsay, Executive Technical Director (resigned 3 October 2022) N. Lindsay, Non-Executive Director (appointed 3 October 2022, resigned 28 November 2022) R. Trzebski, Non-Executive Director C. Bo-Linn, Non-Executive Director (appointed 5 December 2022) H. Atkins, Non-Executive Director (appointed 5 December 2022) A. Saenz, Non-Executive Director (resigned 1 February 2023) A. Gomez Chapman, Non-Executive Director (appointed 1 January 2023) The company secretary is Mr. Mark Anning. Mr. Mark Anning was appointed to the position of company secretary in January 2023 after Mr. Peter Neilsen resigned from the position on 9 January 2023. Principal activities During the year the principal continuing activities of the Consolidated entity consisted of: (a) Exploration and development of lithium brine projects in Argentina; (b) Exploration for minerals. Dividends There were no dividends paid, recommended, or declared during the current or previous financial year. Review of operations The loss from ordinary activities after income tax amounted to $47,253,043 (2022 loss: $5,683,093). Corporate Strategy Lake is transitioning from the evaluation and exploration phase to the next stage of development. Good progress was made during the period at the Demonstration Plant and recent updates of the Kachi Mineral Resource Estimate were announced. With the ongoing recruitment of talented experts, the realignment and new focus of the organization and the enrichment of the Lake Board, Lake is well positioned to complete the development of Kachi, while pursuing the development of Cauchari, Olaroz and Paso de Jama. Lake looks forward to continuing this progress towards the production of high-quality, sustainable lithium for its customers and delivering value to all stakeholders. 14 2 LAKE RESOURCES ANNUAL REPORT 2023 Lake Resources NL Directors' report For the year ended 30 June 2023 Directors and company secretary of this report, unless otherwise stated: Your Directors present their report on the Consolidated entity consisting of Lake Resources NL and the entities it controlled at the end of, or during, the year ended 30 June 2023. S. Crow, Executive Chairman (resigned 5 January 2023) S. Crow, Non-Executive Chairman (appointed 5 January 2023) D. Dickson, Managing Director and Chief Executive Officer (appointed 15 September 2022) N. Lindsay, Executive Technical Director (resigned 3 October 2022) N. Lindsay, Non-Executive Director (appointed 3 October 2022, resigned 28 November 2022) R. Trzebski, Non-Executive Director C. Bo-Linn, Non-Executive Director (appointed 5 December 2022) H. Atkins, Non-Executive Director (appointed 5 December 2022) A. Saenz, Non-Executive Director (resigned 1 February 2023) A. Gomez Chapman, Non-Executive Director (appointed 1 January 2023) The company secretary is Mr. Mark Anning. Mr. Mark Anning was appointed to the position of company secretary in January 2023 after Mr. Peter Neilsen resigned from the position on 9 January 2023. Principal activities During the year the principal continuing activities of the Consolidated entity consisted of: (a) Exploration and development of lithium brine projects in Argentina; (b) Exploration for minerals. Dividends Review of operations Corporate Strategy There were no dividends paid, recommended, or declared during the current or previous financial year. The loss from ordinary activities after income tax amounted to $47,253,043 (2022 loss: $5,683,093). Lake is transitioning from the evaluation and exploration phase to the next stage of development. Good progress was made during the period at the Demonstration Plant and recent updates of the Kachi Mineral Resource Estimate were announced. With the ongoing recruitment of talented experts, the realignment and new focus of the organization and the enrichment of the Lake Board, Lake is well positioned to complete the development of Kachi, while pursuing the development of Cauchari, Olaroz and Paso de Jama. Lake looks forward to continuing this progress towards the production of high-quality, sustainable lithium for its customers and delivering value to all stakeholders. The following persons were Directors of Lake Resources NL during the whole of the financial year and up to the date Kachi Lithium Brine Project - Catamarca Province, Argentina Lake Resources NL Directors' report For the year ended 30 June 2023 Operations Overview of Operations for the Year With the benefit of new leadership and the enhancement of technical expertise on its operations team, Lake made significant progress in the development of Kachi over the past year, achieving major milestones at the Demonstration Plant using Lilac DLE technology, proving out the process flow sheet from brine to battery grade lithium carbonate, and bringing critical technical definition to the project plan, specifically around power, infrastructure, and logistics. Proven DLE process flow sheet The DLE demonstration plant was continuously operational for more than 2,500 hours with 90% uptime. 120,000 litres of eluate containing 2,500kg of lithium carbonate equivalent (LCE) was successfully produced, exceeding battery grade requirements of greater than 99.8 purity. Based on these results, Lilac earned 20% of its potential 25% equity interest in the Kachi project. Significant Resource Expansion Lake announced a resource update revealing a 53 percent increase in resources at Kachi with Measured, Indicated and Inferred increasing from 5.29 Million Tons (Mt) to more than 8.1 Mt of battery grade Lithium Carbonate Equivalent (LCE) (ASX 15 June 2023). The mineral resources last reported on June 15, 2023, have not materially changed since that date. Subsequent to the resource update, further drilling intercept results indicated that the resource is much larger than initially anticipated as the known lithium brine extent continues to expand laterally and vertically (ASX 22 August 2023). Furthermore, lithium grades from recent extraction tests are 20 percent higher than exploration samples. Further JORC updates are expected prior to submitting the DFS. Proven Successful Extraction and Injection Lake proved the concept of extraction and injection to support the production of high purity battery grade lithium carbonate at Kachi (ASX 16 August 2023). The extraction and injection testing confirms highly favorable reservoir hydraulic properties and are indicative of high-yield, production-scale, extraction wells in the core resource area. Kachi Project Reset Based on conclusions following a rigorous assessment of the project, Lake reset the production plan, timelines, and estimated costs of the project. The new approach significantly de-risks the project, with a phased development plan to target plant capacity of 50,000 tpa battery grade lithium carbonate (ASX 19 June 2023). Key target milestones and estimates for Kachi are outlined below: Two phases of 25,000 tpa each • • On track for December 2023 submission of Initial DFS for Phase 1 targeting capacity for 25,000 tpa battery grade lithium carbonate EIA Submission for Phase 1 targeted for Q1 2024 First lithium production targeted for 2H 2027 Estimated CAPEX range : $1.1B -$1.5B Estimated OPEX run rate range : $4.70 - $7.10/kg • • • • 2 3 1515 Lake Resources NL Directors' report For the year ended 30 June 2023 Operations (continued) Overview of Operations for the Year (continued) Kachi Lithium Brine Project - Catamarca Province, Argentina (continued) Power Solution Lake made significant progress identifying a power solution for the project. The base case for the project includes an off-grid solution for train 1 commissioning and start-up with connection to the grid for full Phase 1 capacity. Lake continues to review alternatives including a full off-grid solution for Phase 1 built around solar and battery storage with technical reviews ongoing at this time (ASX 23 August 2023). Other project updates While the development of Kachi is Lake’s top priority and key focus, the company is continuing its exploration work at its three 100-percent owned projects, Olaroz, Cauchari and Paso de Jama. We continue to work with local communities and authorities to obtain additional permits and plan to conduct further geophysics and hydraulic conductivity testing in the coming months. Lake is also submitting a prospecting EIA at its pegmatite deposit at Ancasti in Catamarca to begin early assessment of value and interested parties. Corporate and Financial Advances are continuing towards future clean lithium production from Lake’s flagship Kachi Lithium Brine Project in Catamarca Province. Project Finance (Kachi) As previously announced, Lake received Expressions of Interest from The UK Export Finance (UKEF), the Export Credit Agency (ECA) of the United Kingdom, (ASX 11 August 2021) and from Canada’s Export Credit Agency, EDC, to potentially support approximately 70% of the total finance required for Lake’s Kachi Project (ASX 28 September 2021). These Expressions of Interest remain in place following the Kachi Project reset, and discussions with UKEF and EDC are ongoing. Cash position Lake held cash of A$89,217,466 as at 30 June 2023 (in AUD, USD and Argentine Pesos) with no debt. The Company is financed through to the Definitive Feasibility Studies (DFS) but may need to issue capital or get off-take partners deposits for the Kachi project in addition to the Expressions of Interest. 16 4 LAKE RESOURCES ANNUAL REPORT 2023 Lake Resources NL Directors' report For the year ended 30 June 2023 Operations (continued) Overview of Operations for the Year (continued) Kachi Lithium Brine Project - Catamarca Province, Argentina (continued) Power Solution Lake made significant progress identifying a power solution for the project. The base case for the project includes an off-grid solution for train 1 commissioning and start-up with connection to the grid for full Phase 1 capacity. Lake continues to review alternatives including a full off-grid solution for Phase 1 built around solar and battery storage with technical reviews ongoing at this time (ASX 23 August 2023). Other project updates While the development of Kachi is Lake’s top priority and key focus, the company is continuing its exploration work at its three 100-percent owned projects, Olaroz, Cauchari and Paso de Jama. We continue to work with local communities and authorities to obtain additional permits and plan to conduct further geophysics and hydraulic conductivity testing in the coming months. Lake is also submitting a prospecting EIA at its pegmatite deposit at Ancasti in Catamarca to begin early assessment of value and interested parties. Advances are continuing towards future clean lithium production from Lake’s flagship Kachi Lithium Brine Project in As previously announced, Lake received Expressions of Interest from The UK Export Finance (UKEF), the Export Credit Agency (ECA) of the United Kingdom, (ASX 11 August 2021) and from Canada’s Export Credit Agency, EDC, to potentially support approximately 70% of the total finance required for Lake’s Kachi Project (ASX 28 September 2021). These Expressions of Interest remain in place following the Kachi Project reset, and discussions with UKEF Corporate and Financial Catamarca Province. Project Finance (Kachi) and EDC are ongoing. Cash position Lake held cash of A$89,217,466 as at 30 June 2023 (in AUD, USD and Argentine Pesos) with no debt. The Company is financed through to the Definitive Feasibility Studies (DFS) but may need to issue capital or get off-take partners deposits for the Kachi project in addition to the Expressions of Interest. Lake Resources NL Directors' report For the year ended 30 June 2023 Significant changes in the state of affairs Significant changes in the state of affairs of the Consolidated entity during the financial year were as follows: Lake strengthened its management and operations team during the year, building its U.S. based headquarters in Houston, Texas to take advantage of relevant expertise based there for the oil and gas industry. This included the appointments of David Dickson as Managing Director and Chief Executive Officer on 15 September 2022; Scott Munro as Senior Vice President (SVP) of Technology, Strategy and Risk on 18 October 2022; Ms. Karen Greene as SVP, Investor Relations and Communications on 7 November 2022; Mr. John Freeman as Chief Legal Officer and General Counsel on 1 January 2023; and Ms. Gentry Brann as Chief People and Administration Officer on 2 February 2023. Additionally, Lake strengthened its presence in Argentina with the appointment of Ms. Amalia Saenz, formerly a Lake board member, as SVP, Corporate Affairs and Country Manager of Argentina. Ms. Saenz resigned from her position as non-executive director on 1 February 2023 to assume this role on the Lake management team. To better ensure the successful development of Kachi, and further develop the future opportunities of Cauchari, Olaroz and Paso de Jama, Lake expanded its operating team significantly, adding technical, procurement, project, hydrogeology, drilling and engineering experts, this next stage of development. Strategic and structural organizational changes were put in place to optimize the productivity of this team. These changes included the division of the role of operational oversight into two main areas of responsibility: 1) Process Plant Development and Operations; and 2) Field Development and Evaluation. Guatam Parimoo, previously the Chief Operating Officer left the company (ASX 13 January 2023). to oversee the technical requirements of Other appointments made during the financial year included the appointment of Mr. Mark Anning as Head of Legal, Australia, and Company Secretary (ASX 5 January 2023) and Ms. Lindsay Bourg as Chief Accounting Officer (ASX 3 July 2023). In addition to the transition of Ms. Saenz from non-executive board member to assuming her role on the Lake management team, Lake’s board of directors has undergone other changes during this financial year. Dr. Nicholas Lindsay retired as a director of the Company on 28 November 2022. Enhancements to the board, to strengthen governance and oversight, included the appointments of Mr. Howard Atkins and Dr. Cheemin Bo-Linn on 5 December 2022 and Ms. Ana Chapman on 1 January 2023. Mr. Stu Crow transitioned from his role as Executive Chairman to the role of non-executive chairman of the Lake board on 5 January 2023. Matters subsequent to the end of the financial year No other matter or circumstance has arisen since 30 June 2023 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. 4 5 1717 Lake Resources NL Directors' report For the year ended 30 June 2023 Likely developments and expected results of operations Lake aspires to become a growing contributor to the energy transition by producing high purity lithium, operating sustainably and improving lives. The development of Lake’s flagship Kachi project will continue to be the key area of focus as the company endeavors to fulfil this vision. Lake expects to complete the Phase 1 definitive feasibility study (DFS) in December 2023 for the Kachi project, followed by the Environmental Impact Assessment (EIA) in the first quarter of 2024. Once the EIA is submitted, the process to obtain construction permits officially begins. This process is expected to take up to 12 months. During this time, Lake will seek to finalize structured offtake contracts and secure project financing with the UK and Canada Export Credit Agencies, and potentially other parties. Material Business Risks Our exploration and mining operations will be subject to the normal risks of mining and any revenues will be subject to numerous factors beyond our control. The material business risks that may affect us are summarised below. Future Capital Raisings and Financial Risk Our ongoing activities may require substantial further financing, additional to prior capital raisings. We will also require additional funding to bring the Kachi Project into commercial production. Any additional equity financing may be dilutive to shareholders and may be undertaken at prices lower than the current market price. Debt financing, if available, may involve restrictive covenants which could limit our operations and business strategy. Although we believe that additional capital can be obtained, no assurances can be made that appropriate capital or funding, if and when needed, will be available on terms favourable to us or at all. If we are unable to obtain additional financing as needed, we may be required to reduce, delay or suspend our operations which could have a material adverse effect on our activities and could affect our ability to continue as a going concern. Additionally, if the level of operating expenditure required is higher than expected, our financial position may be adversely affected. We may also experience unexpected shortages or increases in the costs of consumables, spare parts, plant and equipment. Exploration Risk Our success depends on the delineation of economically mineable reserves and resources, access to required development capital, movement in the price of commodities, securing and maintaining title to our tenements and maintaining all consents and approvals necessary for the conduct of our exploration activities. Exploration on our existing tenements may be unsuccessful, resulting in a reduction in the value of those tenements, diminution in our cash reserves and possible relinquishment of the tenements. Our exploration costs are based on certain assumptions with respect to the method and timing of exploration. By their nature, these estimates and assumptions are subject to significant uncertainties and, accordingly, from these estimates and assumptions. the actual costs may materially differ Accordingly, no assurance can be given that the cost estimates and the underlying assumptions will be realised in practice, which may materially and adversely affect our viability. 18 6 LAKE RESOURCES ANNUAL REPORT 2023 Lake Resources NL Directors' report For the year ended 30 June 2023 Likely developments and expected results of operations Lake aspires to become a growing contributor to the energy transition by producing high purity lithium, operating sustainably and improving lives. The development of Lake’s flagship Kachi project will continue to be the key area of focus as the company endeavors to fulfil this vision. Lake expects to complete the Phase 1 definitive feasibility study (DFS) in December 2023 for the Kachi project, followed by the Environmental Impact Assessment (EIA) in the first quarter of 2024. Once the EIA is submitted, the process to obtain construction permits officially begins. This process is expected to take up to 12 months. During this time, Lake will seek to finalize structured offtake contracts and secure project financing with the UK and Canada Export Credit Agencies, and potentially other parties. Material Business Risks Future Capital Raisings and Financial Risk Our ongoing activities may require substantial further financing, additional to prior capital raisings. We will also require additional funding to bring the Kachi Project into commercial production. Any additional equity financing may be dilutive to shareholders and may be undertaken at prices lower than the current market price. Debt financing, if available, may involve restrictive covenants which could limit our operations and business strategy. Although we believe that additional capital can be obtained, no assurances can be made that appropriate capital or funding, if and when needed, will be available on terms favourable to us or at all. If we are unable to obtain additional financing as needed, we may be required to reduce, delay or suspend our operations which could have a material adverse effect on our activities and could affect our ability to continue as a going concern. Additionally, if the level of operating expenditure required is higher than expected, our financial position may be adversely affected. We may also experience unexpected shortages or increases in the costs of consumables, spare parts, plant and equipment. Exploration Risk Our success depends on the delineation of economically mineable reserves and resources, access to required development capital, movement in the price of commodities, securing and maintaining title to our tenements and maintaining all consents and approvals necessary for the conduct of our exploration activities. Exploration on our existing tenements may be unsuccessful, resulting in a reduction in the value of those tenements, diminution in our cash reserves and possible relinquishment of the tenements. Our exploration costs are based on certain assumptions with respect to the method and timing of exploration. By their nature, these estimates and assumptions are subject to significant uncertainties and, accordingly, the actual costs may materially differ from these estimates and assumptions. Accordingly, no assurance can be given that the cost estimates and the underlying assumptions will be realised in practice, which may materially and adversely affect our viability. Lake Resources NL Directors' report For the year ended 30 June 2023 Material Business Risks (continued) Feasibility and Development Risks We may not always be able to exploit successful discoveries which may be made in areas in which we have an interest. Such exploitation would involve obtaining the necessary licences or clearances from relevant authorities that may require conditions to be satisfied and/or the exercise of discretion by such authorities. It may or may not be possible for such conditions to be satisfied. Further, the decision to proceed with further exploitation may require participation of other companies whose interests and objectives may not be the same as ours. There is a complex, multidisciplinary process underway to complete a feasibility study on the Kachi project to support future development. There is a risk that the feasibility study and associated technical works will not achieve the results expected. There is also a risk that, even if a positive feasibility study is produced, the project may not be successfully developed for commercial or financial reasons. Our exploration and mining operations will be subject to the normal risks of mining and any revenues will be subject to numerous factors beyond our control. The material business risks that may affect us are summarised below. Regulatory Risk Our operations are subject to various laws and plans in the jurisdictions in which we work, including those relating to mining, prospecting, development permit and licence requirements, land use, royalties, water, native title and cultural heritage, mine safety and occupational health. Approvals, licences and permits required to comply with such rules are subject to the discretion of the applicable government officials. No assurance can be given that we will be successful in obtaining such authorisations or maintaining such authorisations in full force and effect without modification or revocation. industrial relations, environment, To the extent such approvals are required and not obtained or maintained in a timely manner or at all, our operations may be curtailed or prohibited from continuing or proceeding with production and exploration. Our business and results of operations could be adversely affected if applications lodged for exploration licences are not granted. Maintenance of our mining and exploration tenements are subject to compliance with certain ongoing and periodic conditions. Our inability to meet those conditions may adversely affect our operations, financial position and/or performance. Occupational Health and Safety Given our exploration activities (and especially if we achieve exploration success leading to mining activities), we will face the risk of workplace injuries which may result in workers’ compensation claims, related claims under applicable law and potential occupational health and safety prosecutions. Further, the production processes used in conducting any future mining activities can be dangerous. We have, and intend to maintain, a range of workplace practices, procedures and policies which will seek to provide a safe and healthy working environment for its employees, visitors and the community. Of particular concern will be operating and managing health and safety in an environment where COVID-19 remains a major concern. Limited Operating History of the Group We have limited operating history on which we can base an evaluation of our future prospects. If our business model does not prove to be profitable, investors may lose their investment. Our historical financial information is of limited value because of our lack of operating history and the emerging nature of our business. Our prospects must be considered in the light of the risks, expenses and difficulties frequently encountered by companies in their early stage of development, particularly in the mineral exploration sector, which has a high level of inherent uncertainty. 6 7 1919 Lake Resources NL Directors' report For the year ended 30 June 2023 Material Business Risks (continued) Key Personnel In formulating our exploration programs, feasibility studies and development strategies, we rely to a significant extent upon the experience and expertise of our current management. Many of our key personnel are important to attaining our business goals. One or more of these key employees could leave their employment, and this may adversely affect our ability to conduct our business and, accordingly, affect our financial performance and our share price. is important to our success. The number of persons skilled in the Recruiting and retaining qualified personnel exploration and development of mining properties is limited and competition for such persons is strong. Resource Estimate Risk Resource estimates are expressions of judgement based on knowledge, experience and industry practice. These estimates were appropriate when made but may change significantly when new information becomes available. There are risks associated with such estimates. Resource estimates are necessarily imprecise and depend to some extent on interpretations, which may ultimately prove to be inaccurate and require adjustment. Adjustments to resource estimates could affect our future plans and ultimately our financial performance and value. Lithium price fluctuations, as well as increased production costs or reduced throughput and/or recovery rates, may render resources containing relatively lower grades uneconomic and may materially affect resource estimations. Environmental Risk laws and regulations. We are unable to predict the effect of additional environmental Our operations and activities are subject to the environmental laws and regulations in the jurisdictions in which we work. As with most exploration projects and mining operations, our operations and activities are expected to have an impact on the environment, particularly if advanced exploration or mine development proceeds. We attempt to conduct our operations and activities to the highest standards of environmental obligation, including compliance with all environmental laws and regulations which may be adopted in the future, including whether any such laws or regulations would materially increase our cost of doing business or affect our operations in any area. There can be no assurances that new environmental laws, regulations or stricter enforcement policies, once implemented, will not oblige us to incur significant expenses and undertake significant investments which could have a material adverse effect on our business, financial condition and performance. We are subject to and compliant with all aspects of environmental regulation of our exploration and mining activities. We are not aware of any environmental law that is not being complied with. Availability of Equipment and Contractors Prior to the COVID-19 pandemic and the 2022 Russian invasion of Ukraine, appropriate goods, materials, supplies and equipment, including drill rigs, was in short supply. There was also high demand for contractors providing other services to the mining industry. The COVID-19 pandemic and the 2022 Russian invasion of Ukraine has only served to exacerbate these issues. Consequently, there is a risk that we may not be able to source all the goods, materials, supplies, equipment and contractors to perform required scopes of work to fulfil our proposed activities. There is also a risk that hired contractors may underperform or that equipment may malfunction, either of which may affect the progress of our activities. 20 8 LAKE RESOURCES ANNUAL REPORT 2023 Lake Resources NL Directors' report For the year ended 30 June 2023 Material Business Risks (continued) Key Personnel In formulating our exploration programs, feasibility studies and development strategies, we rely to a significant extent upon the experience and expertise of our current management. Many of our key personnel are important to attaining our business goals. One or more of these key employees could leave their employment, and this may adversely affect our ability to conduct our business and, accordingly, affect our financial performance and our share price. Recruiting and retaining qualified personnel is important to our success. The number of persons skilled in the exploration and development of mining properties is limited and competition for such persons is strong. Resource Estimate Risk Resource estimates are expressions of judgement based on knowledge, experience and industry practice. These estimates were appropriate when made but may change significantly when new information becomes available. There are risks associated with such estimates. Resource estimates are necessarily imprecise and depend to some extent on interpretations, which may ultimately prove to be inaccurate and require adjustment. Adjustments to resource estimates could affect our future plans and ultimately our financial performance and value. Lithium price fluctuations, as well as increased production costs or reduced throughput and/or recovery rates, may render resources containing relatively lower grades uneconomic and may materially affect resource estimations. Environmental Risk Our operations and activities are subject to the environmental laws and regulations in the jurisdictions in which we work. As with most exploration projects and mining operations, our operations and activities are expected to have an impact on the environment, particularly if advanced exploration or mine development proceeds. We attempt to conduct our operations and activities to the highest standards of environmental obligation, including compliance with all environmental laws and regulations. We are unable to predict the effect of additional environmental laws and regulations which may be adopted in the future, including whether any such laws or regulations would materially increase our cost of doing business or affect our operations in any area. There can be no assurances that new environmental laws, regulations or stricter enforcement policies, once implemented, will not oblige us to incur significant expenses and undertake significant investments which could have a material adverse effect on our business, financial condition and performance. We are subject to and compliant with all aspects of environmental regulation of our exploration and mining activities. We are not aware of any environmental law that is not being complied with. Availability of Equipment and Contractors Prior to the COVID-19 pandemic and the 2022 Russian invasion of Ukraine, appropriate goods, materials, supplies and equipment, including drill rigs, was in short supply. There was also high demand for contractors providing other services to the mining industry. The COVID-19 pandemic and the 2022 Russian invasion of Ukraine has only served to exacerbate these issues. Consequently, there is a risk that we may not be able to source all the goods, materials, supplies, equipment and contractors to perform required scopes of work to fulfil our proposed activities. There is also a risk that hired contractors may underperform or that equipment may malfunction, either of which may affect the progress of our activities. Lake Resources NL Directors' report For the year ended 30 June 2023 Material Business Risks (continued) Climate Change Risk Our operations and activities are subject to changes to local or international compliance regulations related to climate change mitigation efforts, specific taxation or penalties for carbon emissions or environmental damage, and other possible restraints on industry that may further impact us and our profitability. While we will endeavour to manage these risks and limit any consequential impacts, there can be no guarantee that we will not be impacted by these occurrences. Climate change may also cause certain physical and environmental risks that we cannot predict, including events such as increased severity of weather patterns, incidence of extreme weather events and longer-term physical risks such as shifting climate patterns. All these risks associated with climate change may significantly change the industry in which we operate. Macro-Economic Risks Although the world has emerged from the COVID-19 pandemic, global supply chains constraints, labour unavailability and equipment shortages are still material risks to our operations. Supply chain constraints continue to be exacerbated because of the 2022 Russian invasion of Ukraine. items are being seen across Hyperinflationary pressures in Argentina for appropriately skilled labour and capital many industries, including mining. Current domestic and international inflation is at historic levels, resulting in persisting elevated interest rates globally. These conditions could have material adverse impact to our cost of doing business and financial performance. Argentina Political Risk Our operations can be affected by changing political, regulatory and economic environments in the countries in which we operate. Our exploration activities are entirely focused in Argentina, which will undergo elections in 2023, the result of which could materially change the business and financial climate of the country. It is possible that adverse election results could materially impact our ability to, for example, maintain our tenements, obtain and maintain permits, negotiate with the government acceptable fiscal terms to support any debt-financing, and/or exportation of capital, any of which, if realised, could impact our financial performance and ability to develop our projects. Argentina Financial Risks Argentina, the jurisdiction in which we focus our operations, maintains capital controls which have the effect of restricting our access to foreign exchange markets and repatriation of profits. These measures have been implemented and maintained sporadically in Argentina for multiple decades with the most recent implementation occurring in 2019. These controls restrict our ability to convert Argentinian Pesos into U.S. Dollars or other currency and may restrict our ability in the future to export from Argentina profits we earn from our operations. Argentina occasionally modifies its capital controls frameworks, any changes to which, could have a material negative impact on our future operations. For example, capital controls may impact our ability to pay for imports into Argentina in U.S. Dollars or other hard currency. Additionally, our lenders may restrict our ability to use a portion of debt funds for in-country operations. Argentina also maintains a robust import program which restricts importation of certain products we may need from the international market. Compliance with Argentina’s import restrictions often results in delays and the need to attempt to source needed products locally, either of which could cause delays to our operations. 8 9 2121 Lake Resources NL Directors' report For the year ended 30 June 2023 Information on directors Name Title Experience and expertise Mr. Stuart Crow Executive Chairman (to 5 January 2023), Non-Executive Director (from 5 January 2023). Mr. Crow has 37 year’s experience in financial services, corporate finance, investor relations, international markets, stock broking and critical minerals supply chains. He is passionate about assisting emerging listed companies to attract investors and capital. He has owned and operated his own businesses in financial services and served on a number of company boards for over fifteen years with mineral exploration companies operating in Australia, Africa and in North and South America. Other current Directorships Non-Executive Chairman Ricca Resources Limited (unlisted) Non-Executive Director Todd River Resources Ltd (ASX:TRT) Non-Executive Director Pulsar Lithium (TSX.V) Former Directorships (last 3 years) Senior Non-Executive Director Atlantic Lithium Limited (AIM & ASX) Name Title Experience and expertise Mr. David Dickson (appointed 15 September 2022) Managing Director and CEO Mr. Dickson was appointed Managing Director and CEO of Lake Resources in September 2022. He is an industry leader with over 30 years’ experience in process technology, engineering, construction and EPC cost management, across the energy sector. He has a proven track record in delivering multi-billion-dollar resource projects. Mr. Dickson spent over seven years as CEO of global engineering and construction firm McDermott International, building a strong leadership team that steered the company into profitable new markets. He ultimately grew the business to over 30,000 employees across 54 international markets. Prior to McDermott he was President of Technip USA, overseeing marketing and operations in North, Central, and South America. Mr. Dickson is a current member of the World Hydrogen Council and serves on the Advisory Board of private equity firm, Quantum Energy Partners, a leading global provider of private capital to the responsibly sourced energy and energy transition and decarbonization sectors. Additionally, he has served as Executive Advisor to strategic investment firm, The Chatterjee Group and is a former Board member of the U.S. National Safety Council. Other current Directorships Former Directorships (last 3 years) None None 22 10 LAKE RESOURCES ANNUAL REPORT 2023 Lake Resources NL Directors' report For the year ended 30 June 2023 Information on directors Name Title Executive Chairman (to 5 January 2023), Non-Executive Director (from 5 Experience and expertise Mr. Crow has 37 year’s experience in financial services, corporate finance, investor relations, international markets, stock broking and critical minerals Mr. Stuart Crow January 2023). supply chains. He is passionate about assisting emerging listed companies to attract investors and capital. He has owned and operated his own businesses in financial services and served on a number of company boards for over fifteen years with mineral exploration companies operating in Australia, Africa and in North and South America. Other current Directorships Non-Executive Chairman Ricca Resources Limited (unlisted) Non-Executive Director Todd River Resources Ltd (ASX:TRT) Non-Executive Director Pulsar Lithium (TSX.V) Name Title Experience and expertise Mr. David Dickson (appointed 15 September 2022) Managing Director and CEO Mr. Dickson was appointed Managing Director and CEO of Lake Resources in September 2022. He is an industry leader with over 30 years’ experience in process technology, engineering, construction and EPC cost management, across the energy sector. He has a proven track record in delivering multi-billion-dollar resource projects. Mr. Dickson spent over seven years as CEO of global engineering and construction firm McDermott International, building a strong leadership team that steered the company into profitable new markets. He ultimately grew the business to over 30,000 employees across 54 international markets. Prior to McDermott he was President of Technip USA, overseeing marketing and operations in North, Central, and South America. Mr. Dickson is a current member of the World Hydrogen Council and serves on the Advisory Board of private equity firm, Quantum Energy Partners, a leading global provider of private capital to the responsibly sourced energy and energy transition and decarbonization sectors. Additionally, he has served as Executive Advisor to strategic investment firm, The Chatterjee Group and is a former Board member of the U.S. National Safety Council. Other current Directorships Former Directorships (last 3 years) None None 10 Lake Resources NL Directors' report For the year ended 30 June 2023 Information on directors (continued) Name Title Experience and expertise Dr. Robert Trzebski Non-Executive Director Dr. Trzebski is an international mining executive bringing substantial operational, commercial and technical experience in global mining markets to Lake Resources. He has over 35 years’ leadership track record in strategic advisory, project management and mineral exploration, technology innovation. He is currently Director, International Business of Austmine and currently leads large-scale industry collaboration projects in the space of decarbonisation and electrification. In previous roles, he held executive positions with key mining industry players, such as Rio Tinto, WMC, Inco, Falconbridge, Schlumberger and Phelps Dodge, having worked across the globe with a long track professional record in Argentina. Dr. Trzebski holds a degree in Geology, PhD in Geophysics, Masters in Project Management and is a fellow of the Australian Institute of Mining and Metallurgy (AusIMM). He is fluent in English, Spanish, French and German. Former Directorships (last 3 years) Senior Non-Executive Director Atlantic Lithium Limited (AIM & ASX) Other current Directorships Austral Gold (ASX: AGD) Former Directorships (last 3 years) None Name Title Experience and expertise Dr.Cheemin Bo-Linn (appointed 5 December 2022) Non-Executive Director Dr. Bo-Linn is an accomplished CEO, former Fortune 100 global operations executive, and board director with over 20 years of governance expertise at public companies and private organisations, across the Americas and Europe. Her prior board leadership at public companies include Lead Compensation, Chair Independent Nominations/Governance, Sustainability, and Tech/Cybersecurity). Director Audit, and (of Her industry operational and board experience includes lithium-ion energy storage, energy, process, technology, manufacturing, and construction. Other current Directorships Former Directorships (last 3 years) None None 11 2323 Lake Resources NL Directors' report For the year ended 30 June 2023 Information on directors (continued) Name Title Experience and expertise Mr. Howard Atkins (appointed 5 December 2022) Non-Executive Director Mr. Atkins brings deep financial management, capital markets, transaction, foreign exchange, and public company experience to the Lake Resources Board. He has over 30 years of financial leadership experience, including 20 years serving as a CFO for organisations including Wells Fargo, New York Life Insurance Company, and Midlantic Bank Corporation. He has served on the boards of Occidental Petroleum, whose markets included the US and South America; and Ingram Micro, a global technology and logistics company also with operations in the US and South America. He has served on the Human Resources, Audit, Finance, and Technology Committees during his public board service. Other current Directorships Daktronics (Nasdaq:DAKT) Former Directorships (last 3 years) None Name Title Experience and expertise Ms. Ana Gomez Chapman (appointed 1 January 2023) Non-Executive Director Ms. Chapman is a financial services executive and board director with over 28 years of investment management, capital markets and business leadership experience. She has worked and lived across the U.S., Europe, Latin America and Asia Pacific. Ms. Chapman is a capital markets expert who has held senior roles at institutional investment firms including Hamilton Lane, where she currently serves as a Managing Director. Other current Directorships Former Directorships (last 3 years) None None 24 12 LAKE RESOURCES ANNUAL REPORT 2023 Lake Resources NL Directors' report For the year ended 30 June 2023 Information on directors (continued) Name Title Experience and expertise Mr. Howard Atkins (appointed 5 December 2022) Non-Executive Director Mr. Atkins brings deep financial management, capital markets, transaction, foreign exchange, and public company experience to the Lake Resources Board. He has over 30 years of financial leadership experience, including 20 years serving as a CFO for organisations including Wells Fargo, New York Life Insurance Company, and Midlantic Bank Corporation. He has served on the boards of Occidental Petroleum, whose markets included the US and South America; and Ingram Micro, a global technology and logistics company also with operations in the US and South America. He has served on the Human Resources, Audit, Finance, and Technology Committees during his public board service. Ms. Ana Gomez Chapman (appointed 1 January 2023) Non-Executive Director Ms. Chapman is a financial services executive and board director with over 28 years of investment management, capital markets and business leadership experience. She has worked and lived across the U.S., Europe, Latin America and Asia Pacific. Ms. Chapman is a capital markets expert who has held senior roles at institutional investment firms including Hamilton Lane, where she currently serves as a Managing Director. Other current Directorships Daktronics (Nasdaq:DAKT) Former Directorships (last 3 years) None Name Title Experience and expertise Other current Directorships Former Directorships (last 3 years) None None Lake Resources NL Directors' report For the year ended 30 June 2023 Information on directors (continued) Name Title Experience and expertise Ms. Amalia Saenz (resigned 1 February 2023) Non-Executive Director Ms. Amalia Sáenz was previously a partner at the legal firm, Zang, Bergel & Viñes, in Buenos Aires leading the Energy and Natural Resources practice. Ms. Sáenz joined the firm some years ago to meet increased demand from clients looking to invest in Argentina’s natural resources space. Prior to Zang, Bergel & Viñes, 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, experience working in a exploration and production operations in a context of a mixture of cultures. Other current Directorships Former Directorships (last 3 years) None None Name Title Experience and expertise Dr. Nicholas Lindsay (resigned 28 November 2022) Executive Technical Director (to 3 October 2022), Non-Executive Director (from 3 October 2022, resigned 28 November 2022) Dr. Lindsay is an experienced mining executive, with a BSc (Hons) degree in Geology, a PhD in process mineralogy (Metallurgy & Materials Engineering) as well as an MBA. He has a long association with South America, where he has successfully taken companies from inception to listing, development and subsequent acquisition such as Laguna Resources which he led as Managing Director. Other current Directorships Manuka Resources (ASX:MKR) Former Directorships (last 3 years) None Note • Other current Directorships quoted above are current Directorships for listed entities only and excludes Directorships of all other types of entities, unless otherwise stated. • Former Directorships (last 3 years) quoted above are Directorships held in the last 3 years for listed entities only and excludes Directorships of all other types of entities, unless otherwise stated. 12 13 2525 Lake Resources NL Directors' report For the year ended 30 June 2023 Company secretaries The Company Secretary in office until 9 January 2023 was Mr. Peter Neilsen. Mr. Neilsen is a chartered accountant with more than 20 years’ experience in all facets of 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. Mr. Mark Anning who was appointed on 9 January 2023 is a Chartered Secretary with 30 years’ experience in legal and corporate practice. He specializes in corporate and commercial law, dispute resolution, risk management, and corporate governance. He has practiced at Partner level in private practice, and in-house at CEO and Chair direct report level for several ASX and NASDAQ listed companies. He is a Fellow of the Governance Institute of Australia and is admitted to practice in all Commonwealth Courts and the Supreme Courts of Queensland and Victoria. Directors’ Interests in the Consolidated entity At the date of this report or last date of employment, the interests of the Directors in the shares, options and performance rights of the Consolidated entity were: Ordinary Shares Options Performance Rights Performance Shares Restricted Stock Unit S. Crow (Non-Executive Chairman) D. Dickson (Managing Director and Chief Executive Officer) N. Lindsay (Non-Executive Director) C. Bo-Linn (Non-Executive Director) H. Atkins (appointed 5 December 2022) A. Gomez Chapman (appointed 1 January 2023) 10,000,000 - 5,000,000 - - - - - 4,000,000 - - - - - - - - - - - - - - - 1,000,000 - 232,500 232,500 238,500 26 14 LAKE RESOURCES ANNUAL REPORT 2023 Lake Resources NL Directors' report For the year ended 30 June 2023 Company secretaries The Company Secretary in office until 9 January 2023 was Mr. Peter Neilsen. Mr. Neilsen is a chartered accountant with more than 20 years’ experience in all facets of 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. Mr. Mark Anning who was appointed on 9 January 2023 is a Chartered Secretary with 30 years’ experience in legal and corporate practice. He specializes in corporate and commercial law, dispute resolution, risk management, and corporate governance. He has practiced at Partner level in private practice, and in-house at CEO and Chair direct report level for several ASX and NASDAQ listed companies. He is a Fellow of the Governance Institute of Australia and is admitted to practice in all Commonwealth Courts and the Supreme Courts of Queensland and Victoria. Directors’ Interests in the Consolidated entity At the date of this report or last date of employment, the interests of the Directors in the shares, options and performance rights of the Consolidated entity were: S. Crow (Non-Executive Chairman) D. Dickson (Managing Director and Chief Executive Officer) Director) Director) N. Lindsay (Non-Executive C. Bo-Linn (Non-Executive H. Atkins (appointed 5 December 2022) A. Gomez Chapman (appointed 1 January 2023) Ordinary Shares 10,000,000 Performance Performance Options Rights Shares Restricted Stock Unit 5,000,000 4,000,000 - - - - - - - - - - - - - - - - 1,000,000 - 232,500 232,500 238,500 - - - - - Lake Resources NL Directors' report For the year ended 30 June 2023 Meetings of Directors The number of meetings of the Consolidated entity's Board of Directors held during the year ended 30 June 2023, and the numbers of meetings attended by each Director were: S. Crow3 D. Dickson4(appointed 15 September 2022) N. Lindsay (resigned 28 November 2022) R. Trzebski5 C. Bo-Linn6(appointed 5 December 2022) H. Atkins7(appointed 5 December 2022) A. Saenz (resigned 1 February 2023) A. Gomez Chapman (appointed 1 January 23) Board Meeting Audit & Risk Committee1 Nomination & Governance Committee Compensation Committee2 Held Attended Held Attended Held Attended Held Attended 5 4 3 5 2 2 3 2 5 4 3 5 2 2 3 2 1 1 1 1 3 3 1 3 1 1 1 1 3 3 1 3 - - - 5 5 - - 5 - - - 5 5 - - 5 1 1 1 3 2 2 1 - 1 1 1 3 2 2 1 - “Held” represents the number of meetings held during the time the Director held office and was eligible to attend. 1 2 3 4 5 6 7 Audit Committee reconstituted as Audit & Risk Committee from 11 February 2023 Nomination & Remuneration Committee reconstituted as Compensation Committee from 11 February 2023 Executive Chair until 5 January 2023 and thereafter Non-Executive Chair, Chair of Nomination & Remuneration Committee (now constituted as Compensation Committee) until 11 February 2023. Managing Director and Chief Executive Officer Chair of Audit Committee until 11 February 2023 (now constituted as Audit & Risk Committee) Chair of Nomination & Governance Committee Chair of Audit & Risk committee from 11 February 2023 14 15 2727 Lake Resources NL Directors' report For the year ended 30 June 2023 LETTER FROM COMPENSATION COMMITTEE CHAIR Dear Shareholders, On behalf of the Board and the Compensation Committee, I am pleased to present the Remuneration Report for the financial year to 30 June 2023 (FY23). FY23 Significant events Over the past year, we have taken significant actions to fortify our management team and board, recruiting a deep bench of expertise and practical experience. The addition of this talent is mission critical for the realisation of our flagship Kachi Lithium Brine Project (“Kachi” or the “Kachi Project”) and has brought a sharper lens and more defined rigour to our strategic priorities and governance framework. As a result, the Company is well-positioned to deliver results to our shareholders and key stakeholders. In June 2023, we shared important updates to the Company’s strategy and production capacity targets, following several months of technical evaluation and gap analysis of the Kachi Project. As a result of this assessment, we have selected a new, phased approach to production that de-risks project execution, enhances plant productivity and provides the fastest path to first lithium, which is now expected in 2027. Underpinning this phased approach to production is the scale of our resource at Kachi, which has grown significantly since January 2023 across measured, inferred and indicated categories. Per our most recent mineral resource update on 15 June 2023, our resource appears to support a supply life of more than 25 years. Additionally, we have proven our process flow sheet, from brine to battery-grade lithium carbonate, producing consistent high purity (99.8%) product with significantly less environmental impact than traditional hard rock or evaporation pond methods. The new strategy and recruitment of critical talent has occurred under the leadership of Mr. David Dickson, who was appointed Managing Director and Chief Executive Officer in September 2022. Mr. Dickson brings extensive international experience in the construction of large specialty chemical plants, particularly in remote locations, and has successfully delivered multibillion dollar resource projects. Since joining the Company, Mr. Dickson has resolved previously identified issues and forged a positive relationship with technology partner Lilac Solutions. He has also strengthened executive and technical teams and led the comprehensive reassessment of the project to better position the company for success and its potential to provide long-term value to shareholders. 28 16 LAKE RESOURCES ANNUAL REPORT 2023 Lake Resources NL Directors' report For the year ended 30 June 2023 LETTER FROM COMPENSATION COMMITTEE CHAIR (continued) FY23 Significant events (continued) During the year, we strengthened the capability, experience and independence of the Board with the appointment of three US-based Non-Executive Directors: Ms. Ana Gomez Chapman, Dr. Cheemin Bo-Linn, and Mr. Howard Atkins. These appointments bring greater diversity and expertise to the Board, broadening our skills around capital markets, rare earth mining, sustainability, cybersecurity and financial management. Further details of our key management personnel (KMP) are disclosed in Table 1. After gaining shareholder approval for an increase in aggregate fees payable to Non-Executive Directors at the remuneration of Non-Executive Directors was amended with a view to attract and retain directors with the necessary skills to achieve the Company’s strategic priorities. The changes include an increase to fees for services to the Board and the relevant Board Committees in addition to the introduction of a grant of Restricted Stock Units. Details are set out in the Non-Executive Director’s Remuneration section. the Company’s 2022 Annual General Meeting of Shareholders, To improve Lake Resource's alignment with corporate governance best practices, we have: • • Improved Board composition to achieve a majority (four out of six) of independent directors; Improved Board diversity with the appointment of new directors and strengthened the capabilities and experience of the Board to drive our broader sustainability strategies; • Restored separate CEO and Chairman roles, concluding the interim arrangement where roles were combined • following the departure of former CEO, Mr. Stephen Promnitz; Established standalone Audit & Risk, Compensation, Nomination & Governance, and Finance committees. These committees (with the exception of the Finance Committee) are chaired by an independent director and comprised solely of independent Non-Executive Directors. • • The Audit & Risk, Compensation, Nomination & Governance Committees are chaired by an independent director and comprised solely of independent Non-Executive Directors. The Finance Committee is chaired by an independent director and comprised of a majority independent Non-Executive Directors. Response to First Remuneration Strike (FY22) At the November 2022 Annual General Meeting of Shareholders, a 34.82% vote against the Remuneration Report was recorded. Lake Resources takes shareholder concerns regarding our Remuneration Framework seriously. We have taken steps to improve both the Remuneration Framework for management and our governance procedures to determine remuneration matters which have been outlined in Section 3 “Response to First Strike” and table 2 of the audited Remuneration Report. 17 2929 Lake Resources NL Directors' report For the year ended 30 June 2023 LETTER FROM COMPENSATION COMMITTEE CHAIR (continued) Beyond FY24 The Compensation Committee will continue to work with its independent advisers to further enhance the Executive Remuneration Framework in FY24 in alignment with our Remuneration Strategy Principles and to ensure that compensation serves to retain our key talent on the road to achieving the strategic and operational milestones required to commence production by 2027. The Committee will establish ongoing benchmarking of executive pay to assist with determining appropriate market competitive pay levels for executive KMP. Any changes to the framework will ensure that KMP remuneration is tied to tangible stakeholder outcomes, including financial, non-financial and operational goals, to enhance alignment with market and shareholder expectations. Furthermore, the Company continues to take steps to position itself to deliver on the strategic and operational milestones outlined in the updated strategy announced in June 2023. This includes transitioning the executive, operational and technical leadership team to be primarily based in the US to allow the Company to have stronger geographic access to the Kachi Project, improve opportunities for funding of the Kachi project and other strategic priorities of Lake Resources and enhance supply chains in North America and Argentina. The Company will continue to consider these matters when setting remuneration for its executive talent to ensure competitiveness in all relevant markets. As outlined above, the Compensation Committee takes the concerns of shareholders seriously and will continue to meet with all relevant stakeholders going forward, including in circumstances where key elements of the Executive Remuneration Framework are restructured. Robert Dr. Robert Trzebski Chair, Lake Resources Compensation Committee 30 18 LAKE RESOURCES ANNUAL REPORT 2023 Lake Resources NL Directors' report For the year ended 30 June 2023 LETTER FROM COMPENSATION COMMITTEE CHAIR (continued) Beyond FY24 The Compensation Committee will continue to work with its independent advisers to further enhance the Executive Remuneration Framework in FY24 in alignment with our Remuneration Strategy Principles and to ensure that compensation serves to retain our key talent on the road to achieving the strategic and operational milestones required to commence production by 2027. The Committee will establish ongoing benchmarking of executive pay to assist with determining appropriate market competitive pay levels for executive KMP. Any changes to the framework will ensure that KMP remuneration is tied to tangible stakeholder outcomes, including financial, non-financial and operational goals, to enhance alignment with market and shareholder expectations. Furthermore, the Company continues to take steps to position itself to deliver on the strategic and operational milestones outlined in the updated strategy announced in June 2023. This includes transitioning the executive, operational and technical leadership team to be primarily based in the US to allow the Company to have stronger geographic access to the Kachi Project, improve opportunities for funding of the Kachi project and other strategic priorities of Lake Resources and enhance supply chains in North America and Argentina. The Company will continue to consider these matters when setting remuneration for its executive talent to ensure competitiveness in all relevant As outlined above, the Compensation Committee takes the concerns of shareholders seriously and will continue to meet with all relevant stakeholders going forward, including in circumstances where key elements of the Executive Remuneration Framework are restructured. markets. Robert Dr. Robert Trzebski Chair, Lake Resources Compensation Committee Lake Resources NL Directors' report For the year ended 30 June 2023 Remuneration report (audited) OVERVIEW OF THE REMUNERATION REPORT The following pages describing the Remuneration Framework have been prepared in accordance with the requirements of Section 300A of the Corporations Act 2001 and audited as required by Section 308(3C) of the Corporations Act 2001. 1 Key takeaways from FY23 strategic update and KMP covered by the Remuneration Report 2 Remuneration Governance 3 Response To First Remuneration Strike 4 Executive Remuneration Framework 5 Non-Executive Director Remuneration 6 Statutory Remuneration Disclosures 7 Service Agreements 8 Share-Based Compensation 9 Related Party Transaction 18 3131 Lake Resources NL Directors' report For the year ended 30 June 2023 Remuneration report (audited) (continued) OVERVIEW OF THE REMUNERATION REPORT (continued) KMP Covered by Report The Remuneration Report outlines the compensation paid to personnel who held Key Management Personnel (KMP)* positions during FY23 comprising its Non-Executive Directors (“NED”), Managing Director / CEO (“MD / CEO”), and Chief Financial Officer (“CFO”), a detailed list of which can be found in table 1 below. Table 1: FY23 Key Management Personnel (KMP) Name NON-EXECUTIVE DIRECTORS Stuart Crow(1) Dr. Robert Trzebski Dr. Cheemin Bo-Linn Howard Atkins Ana Gomez Chapman Dr. Nicholas Lindsay(2) Amalia Saenz EXECUTIVE KMP David Dickson Peter Neilsen Gautam Parimoo Position Term as KMP in FY23 Chair of the Board Director Director Director Director Director Director Commenced 5 January 2023 Full year Commenced 5 December 2022 Commenced 5 December 2022 Commenced 1 January 2023 Commenced 28 November 2022 Ceased 1 February 2023 Managing Director & CEO Chief Financial Officer Chief Operations Officer Commenced 15 September 2022 Full year Ceased on 9 January 2023 (1) (2) * Mr. Stuart Crow assumed the position of Non-executive Chair of the Board on 5 January 2023 having previously served as executive chair from 20 June 2022 to 5 January 2023. Dr. Nicholas Lindsay ceased their position as Non-Executive Director as of 28 November 2022 having previously served as Technical Director (executive KMP) until 3 October 2022. Key Management Personnel (KMP) are identified based on the definitions of paragraph 9 of Accounting Standard AASB 124 (“Key management personnel are those persons having authority and responsibility for planning, directing and controlling the activities of the entity, directly or indirectly, including any director (whether executive or otherwise) of that entity”). 32 20 LAKE RESOURCES ANNUAL REPORT 2023 Lake Resources NL Directors' report For the year ended 30 June 2023 Remuneration report (audited) (continued) REMUNERATION GOVERNANCE Remuneration governance has been strengthened to support the effective design and delivery of the Remuneration Framework, to achieve alignment with shareholder interests. The below outlines the remuneration governance structure to determine the remuneration of KMP and employees. During the current reporting period, the Company engaged Willis Towers Watson (WTW) to assist with the development of the Remuneration Report. The Board is satisfied that WTW did not provide Remuneration Recommendation as defined in Section 9B of the Corporations Act 2001. Lake Resources NL Directors' report For the year ended 30 June 2023 Remuneration report (audited) (continued) OVERVIEW OF THE REMUNERATION REPORT (continued) KMP Covered by Report The Remuneration Report outlines the compensation paid to personnel who held Key Management Personnel (KMP)* positions during FY23 comprising its Non-Executive Directors (“NED”), Managing Director / CEO (“MD / CEO”), and Chief Financial Officer (“CFO”), a detailed list of which can be found in table 1 below. Table 1: FY23 Key Management Personnel (KMP) Name Position Term as KMP in FY23 NON-EXECUTIVE DIRECTORS Chair of the Board Commenced 5 January 2023 Stuart Crow(1) Dr. Robert Trzebski Dr. Cheemin Bo-Linn Howard Atkins Ana Gomez Chapman Dr. Nicholas Lindsay(2) Amalia Saenz EXECUTIVE KMP David Dickson Peter Neilsen Gautam Parimoo Director Director Director Director Director Director Full year Commenced 5 December 2022 Commenced 5 December 2022 Commenced 1 January 2023 Commenced 28 November 2022 Ceased 1 February 2023 Managing Director & CEO Chief Financial Officer Chief Operations Officer Commenced 15 September 2022 Full year Ceased on 9 January 2023 (1) (2) * Mr. Stuart Crow assumed the position of Non-executive Chair of the Board on 5 January 2023 having previously served as executive chair from 20 June 2022 to 5 January 2023. Dr. Nicholas Lindsay ceased their position as Non-Executive Director as of 28 November 2022 having previously served as Technical Director (executive KMP) until 3 October 2022. Key Management Personnel (KMP) are identified based on the definitions of paragraph 9 of Accounting Standard AASB 124 (“Key management personnel are those persons having authority and responsibility for planning, directing and controlling the activities of the entity, directly or indirectly, including any director (whether executive or otherwise) of that entity”). 20 21 3333 Lake Resources NL Directors' report For the year ended 30 June 2023 Remuneration report (audited) (continued) RESPONSE TO FIRST STRIKE In response to the 34.82% vote against the Remuneration Report at the November 2022 Annual General Meeting of Shareholders, the Company has taken steps to address and mitigate shareholder concerns regarding the Remuneration Framework, which are summarised in Table 2 below. Table 2 : Feedback on Remuneration Report Feedback Response • With the appointment of Mr. Dickson, Quantum of pay (Managing Director/Chief Operating Officer) Lack of performance hurdles the Company has sought to provide a competitive remuneration package in the context of the Company’s alignment of operations to serve North American supply chains and to provide stronger access to the Kachi Project operations in Argentina. To do so the Company is expanding its executive, operational and technical leadership in the US. Accordingly, the Board believes that remuneration structures should be more closely aligned with US structures and levels while also being relevant in Australia. The Compensation Committee will continue to develop pay structures that strengthen the linkages between incentives and corporate and individual performance, while ensuring pay is appropriate and reasonable relative to competitors and peer companies. • • While some portions of the Company’s stock awards vest based on time, most grants are based on achievement of specific performance hurdles set in alignment with strategic and operational goals of the Kachi Project. The incentive plans in place are currently being reviewed and will be updated to improve linkage to the key performance milestones of the Kachi Project going forward. • Details of the KPIs used to assess KMP performance and awards under the Company’s Short-Term Variable Remuneration Plan for the 2023 calendar year are outlined in Table 6 of the Remuneration Report. Use of sign-on awards • The Compensation Committee acknowledges concerns about the use of sign-on awards at Lake Resources, particularly as they vest in annual tranches and do not have explicit performance conditions attached. • As the sign-on awards were delivered entirely in equity (as either stock options or restricted stock units), there is alignment of awards value with the share price and shareholder outcomes. The Board believes these awards are needed to recruit the best talent, are aligned with relevant market practices, and encourage substantial and long-term ownership among newly recruited executives while also serving the purpose of retaining key talent. The Compensation Committee considers the use of sign-on awards appropriate due to the Company’s business being in a critical development phase, with the awards ultimate value being linked to the success of Lake Resource's key development projects. • 34 22 LAKE RESOURCES ANNUAL REPORT 2023 Lake Resources NL Directors' report For the year ended 30 June 2023 Remuneration report (audited) (continued) RESPONSE TO FIRST STRIKE In response to the 34.82% vote against the Remuneration Report at the November 2022 Annual General Meeting of Shareholders, the Company has taken steps to address and mitigate shareholder concerns regarding the Remuneration Framework, which are summarised in Table 2 below. Table 2 : Feedback on Remuneration Report Feedback Response Quantum of pay (Managing Director/Chief Operating Officer) • With the appointment of Mr. Dickson, the Company has sought to provide a competitive remuneration package in the context of the Company’s alignment of operations to serve North American supply chains and to provide stronger access to the Kachi Project operations in Argentina. To do so the Company is expanding its executive, operational and technical leadership in the US. Accordingly, the Board believes that remuneration structures should be more closely aligned with US structures and levels while also being relevant in Australia. The Compensation Committee will continue to develop pay structures that strengthen the linkages between incentives and corporate and individual performance, while ensuring pay is appropriate and reasonable relative to competitors and peer companies. Lack of performance • While some portions of the Company’s stock awards vest based on time, most hurdles grants are based on achievement of specific performance hurdles set in alignment with strategic and operational goals of the Kachi Project. • The incentive plans in place are currently being reviewed and will be updated to improve linkage to the key performance milestones of the Kachi Project going forward. • Details of the KPIs used to assess KMP performance and awards under the Company’s Short-Term Variable Remuneration Plan for the 2023 calendar year are outlined in Table 6 of the Remuneration Report. Use of sign-on awards • The Compensation Committee acknowledges concerns about the use of sign-on awards at Lake Resources, particularly as they vest in annual tranches and do not have explicit performance conditions attached. • As the sign-on awards were delivered entirely in equity (as either stock options or restricted stock units), there is alignment of awards value with the share price and shareholder outcomes. The Board believes these awards are needed to recruit the best talent, are aligned with relevant market practices, and encourage substantial and long-term ownership among newly recruited executives while also serving the purpose of retaining key talent. • The Compensation Committee considers the use of sign-on awards appropriate due to the Company’s business being in a critical development phase, with the awards ultimate value being linked to the success of Lake Resource's key development projects. Lake Resources NL Directors' report For the year ended 30 June 2023 Remuneration report (audited) (continued) RESPONSE TO FIRST STRIKE (continued) Table 2 : Feedback on Remuneration Report (continued) Response Feedback • Remuneration Governance The ASX Corporate Governance Principles and Recommendations note that best practice is for companies to have separate Nomination & Governance and Remuneration Committees; a step which we have taken to enhance the independence and efficiency of Director nominations and pay governance. The following improvements have been introduced to strengthen governance: The Board have approved substantial share ownership guidelines for the Board, KMP and senior executives that will take effect from January 2024; Introduction of malus/clawback policy to govern the deferral, cancellation or clawback of performance-based remuneration in the event of serious misconduct or a material misstatement in the Company’s financial statements. the Compensation Committee will In the coming year, further enhancements to the Remuneration Framework to better align with governance best practices and stakeholder expectations. The Compensation Committee hired an independent, third-party compensation consultant to assist in establishing pay governance best practices and updating Lake Resources’ remuneration practices and policies to better align with market practices, stakeholder expectations and shareholder outcomes. consider - - • • The Compensation Committee has resolved to improve shareholder communication and will be undertaking proactive outreach to our key shareholders. In the past year we have improved our engagement strategy to regularly consult with key stakeholders. We have met with close to 200 institutional and retail shareholders or shareholder representatives to discuss key strategic, operational, remuneration and governance matters. In the lead up to the 2023 annual general meeting of shareholders, we have engaged with key proxy advisors in the Australian market to discuss remuneration matters, including the remuneration strike sustained at the 2022 annual general meeting of shareholders, and the actions the Company is taking to address the issues cited by proxy advisors and investors. 22 23 3535 Lake Resources NL Directors' report For the year ended 30 June 2023 Remuneration report (audited) (continued) EXECUTIVE REMUNERATION FRAMEWORK Remuneration Strategy Principles The Board’s policy is to remunerate KMP at reasonable and appropriate market rates for their time, commitment, responsibilities and overall performance. The Board determines payments to the KMP and reviews their remuneration annually. The review is based on an assessment of relevant market practice relative to the duties and accountabilities of each individual and refers to the guiding principles for KMP Remuneration as adopted by the Board. The Lake Resources team are transitioning to have a greater proportion of its executive, operational and technical leadership team to be based in the US to provide greater geographical access to the Kachi Project, increasing opportunities for funding and streamlining supply chain procedures within the Company. These matters and the resulting need to recruit exceptional talent in the US remain a key consideration of the Board and Compensation Committee when reviewing and determining compensation structures at Lake Resources. 36 24 LAKE RESOURCES ANNUAL REPORT 2023 Lake Resources NL Directors' report For the year ended 30 June 2023 Remuneration report (audited) (continued) EXECUTIVE REMUNERATION FRAMEWORK Remuneration Strategy Principles The Board’s policy is to remunerate KMP at reasonable and appropriate market rates for their time, commitment, responsibilities and overall performance. The Board determines payments to the KMP and reviews their remuneration annually. The review is based on an assessment of relevant market practice relative to the duties and accountabilities of each individual and refers to the guiding principles for KMP Remuneration as adopted by the Board. The Lake Resources team are transitioning to have a greater proportion of its executive, operational and technical leadership team to be based in the US to provide greater geographical access to the Kachi Project, increasing opportunities for funding and streamlining supply chain procedures within the Company. These matters and the resulting need to recruit exceptional talent in the US remain a key consideration of the Board and Compensation Committee when reviewing and determining compensation structures at Lake Resources. Lake Resources NL Directors' report For the year ended 30 June 2023 Remuneration report (audited) (continued) EXECUTIVE REMUNERATION FRAMEWORK (continued) Remuneration Framework The Company aims to incentivise executives consistent with our Remuneration Strategy Principles with a specific focus on retaining executive level talent in addition to considering the relevant executive’s position, responsibilities and performance. The components of the Remuneration Framework are shown in Table 3. Table 3: FY23 Remuneration Framework Description Purpose Fixed Remuneration Fixed Annual Remuneration (FAR) Base salary, post-employment benefits (superannuation for AUS executives and 401 (k) contributions for US executives), and non-monetary benefits. To provide basic remuneration for the services of executive KMP, consistent with each role’s scope of responsibility and the individual’s background, experience and performance in addition to retaining key talent that are in the best position to achieve strategic milestones. Performance-based Variable Components Short-term Variable Remuneration (STVR) Long-term Incentive / Long-term Variable Remuneration (LTI / LTVR) Short-term incentive awards recognise both business and individual performance, taking into consideration each individual’s contributions and behaviours over the year. Short-term incentives are discretionary and intended to incentivise the achievement of financial and operational goals relative to the annual business plan. A maximum award is set for each KMP, and payouts can range from nil to 100% of the maximum STVR based on performance. The conditional grant of Company shares. To create clear alignment between executive pay and achievement of long-term business objectives, to retain critical talent, and to create a clear link between executive wealth and long-term shareholder returns. 24 25 3737 Lake Resources NL Directors' report For the year ended 30 June 2023 Remuneration report (audited) (continued) EXECUTIVE REMUNERATION FRAMEWORK (continued) Remuneration Framework (continued) Short-term Variable Remuneration (STVR) Table 3: FY23 Remuneration Framework (continued) Fixed Remuneration Fixed Annual Remuneration (FAR) FAR is generally reviewed by the Board annually and is intended to be market competitive. The Board believes it should be a less prominent portion of total pay than the performance-based pay components and will work with their independent advisors to review the appropriate mix as part of enhancements to the Framework. For residents of the US, fringe benefits such as 401(k) matching for the contributions by the relevant personnel are provided. Other benefits to KMP are aligned with the broader employee population and are designed to meet the local regulations and practices. The STVR is awarded through a mix of cash (50%-100%) and shares (0%-50%) deferred over three-years, vesting in annual tranches. Awards are finalised based on performance against pre-defined performance targets set by the Board. Targets may include operational targets relating to development of the Kachi project, financial targets and individual behaviours that contribute to the achievement of the Company’s strategic goals. Non-financial goals, including addressing sustainability, are reflected in the individual targets of the executive. Our Approach Performance-based Variable Components Long-term Incentive / Long-term Variable Remuneration (LTI / LTVR) Depending on the specific terms of each LTI award and its recipient, shares vest based on either achievement of the Company’s long-term performance or based on continuous service (time-based vesting).Metrics attached to the performance-linked portion of the LTI / LTVR are primarily linked to progress towards operationalising Lake Resources’ flagship Kachi project. The targets for each executive are set specific to their role in achieving key milestones related to the development of the Kachi project. 38 26 LAKE RESOURCES ANNUAL REPORT 2023 Lake Resources NL Directors' report For the year ended 30 June 2023 Remuneration report (audited) (continued) EXECUTIVE REMUNERATION FRAMEWORK (continued) Remuneration Framework (continued) Table 3: FY23 Remuneration Framework (continued) Fixed Remuneration Fixed Annual Remuneration (FAR) FAR is generally reviewed by the Board annually and is intended to be market competitive. The Board believes it should be a less prominent portion of total pay than the performance-based pay components and will work with their independent advisors to review the appropriate mix as part of enhancements to the Framework. For residents of the US, fringe benefits such as 401(k) matching for the contributions by the relevant personnel are provided. Other benefits to KMP are aligned with the broader employee population and are designed to meet the local regulations and practices. The STVR is awarded through a mix of cash (50%-100%) and shares (0%-50%) deferred over three-years, vesting in annual tranches. Awards are finalised based on performance against pre-defined performance targets set by the Board. Targets may include operational targets relating to development of the Kachi project, financial targets and individual behaviours that contribute to the achievement of the Company’s strategic goals. Non-financial goals, including addressing sustainability, are reflected in the individual targets of the executive. Our Approach Performance-based Variable Components Short-term Variable Remuneration (STVR) Long-term Incentive / Long-term Variable Remuneration (LTI / LTVR) Depending on the specific terms of each LTI award and its recipient, shares vest based on either achievement of the Company’s long-term performance or based on continuous service (time-based vesting).Metrics attached to the performance-linked portion of the LTI / LTVR are primarily linked to progress towards operationalising Lake Resources’ flagship Kachi project. The targets for each executive are set specific to their role in achieving key milestones related to the development of the Kachi project. Lake Resources NL Directors' report For the year ended 30 June 2023 Remuneration report (audited) (continued) EXECUTIVE REMUNERATION FRAMEWORK (continued) Maximum Remuneration Mix The maximum total remuneration opportunities provided to executive KMP are reviewed on an annual basis with reference to the Remuneration Strategy Principles and the market practices of relevant market competitors for the applicable position and responsibilities. Figure 1 represents the maximum remuneration payable to executive KMP based on the primary remuneration elements in their first year of appointment set to align with compensation practices in relevant markets, including the US and to ensure retention of talent in critical functions required to achieve strategic and operational goals. Figure 1: Maximum Remuneration Mix for Incumbent Executive KMP Managing Director and Chief Executive MD/CEO Officer (USD): (USD): CFO (AUD; incentive plans for first year of service only)*: At Risk (50%) At Risk (20%) *The CFO’s initial service agreement outlined incentive opportunity for the first year of service. In addition, the CFO’s fixed remuneration has been increased to USD 500,000 as of 1 August 2022, to reflect the expanding roles and responsibilities of the CFO position to achieve the new strategic goals to commence production by 2027 as outlined in the project reset in addition to ensuring alignment with the US market. In addition to the standard elements of remuneration for executive KMP, sign-on awards may be provided on a case-by-case basis and is not a guaranteed element of the Company’s Remuneration Framework. Fixed Annual Remuneration (FAR) Fixed annual remuneration consists of base salary, superannuation, fringe benefits including 401(k) contributions and other non-monetary benefits and is awarded to provide a basic retainer for KMP services to the Company consistent with each role’s scope of responsibility and the individual’s background, experience and performance. The Board generally reviews FAR on an annual basis to ensure alignment with the market and may make adjustments based on the Company’s need and where a gap with the market is identified. Executives may receive FAR as cash or other fringe benefits where it provides additional tax-effective benefits and performance incentives to the executive. 26 27 3939 Lake Resources NL Directors' report For the year ended 30 June 2023 Remuneration report (audited) (continued) EXECUTIVE REMUNERATION FRAMEWORK (continued) Fixed Annual Remuneration (FAR) (continued) In FY23, base salary (excluding statutory superannuation, fringe benefits (401(k) contributions) and non-monetary benefits) for Executive KMP during FY23 were set as follows: Table 4: Details of Base Salary KMP Base salary David Dickson USD 1,000,000 Peter Neilsen USD 500,000 Dr. Nicholas Lindsay AUD 300,000 USD 335,000 Gautam Parimoo Transition of Performance Period Other notes Mr. Dickson is eligible for employer 401(k) contributions of up to US $ 66,000 per annum. Mr Dickson did not make 401(k) contributions during FY23. During FY23, Mr. Neilsen’s base pay was increased from AUD 330,000 to USD 500,000 to reflect the roles and responsibilities of the CFO within the organisation Ceased employment on 28 November 2022 Ceased employment on 9 January 2023 In FY 2023 and prior years, the STVR was awarded based on a performance period aligned with the financial year (July to June). However, from FY24, the STVR will run on a performance cycle based on the calendar year. As such, the STVR for executive KMP will be based on performance period running from January to December going forward. For all KMP where existing incentive plans are based on the financial year (July to June), awards will be pro-rated to allow for transition to a performance period that runs over the calendar year. 40 28 LAKE RESOURCES ANNUAL REPORT 2023 Lake Resources NL Directors' report For the year ended 30 June 2023 Remuneration report (audited) (continued) EXECUTIVE REMUNERATION FRAMEWORK (continued) Fixed Annual Remuneration (FAR) (continued) In FY23, base salary (excluding statutory superannuation, fringe benefits (401(k) contributions) and non-monetary benefits) for Executive KMP during FY23 were set as follows: Table 4: Details of Base Salary KMP Base salary Other notes David Dickson USD 1,000,000 US $ 66,000 per annum. Mr Dickson did not make 401(k) Mr. Dickson is eligible for employer 401(k) contributions of up to contributions during FY23. During FY23, Mr. Neilsen’s base pay was increased from AUD Peter Neilsen USD 500,000 330,000 to USD 500,000 to reflect the roles and responsibilities of Dr. Nicholas Lindsay AUD 300,000 Gautam Parimoo USD 335,000 Transition of Performance Period the CFO within the organisation Ceased employment on 28 November 2022 Ceased employment on 9 January 2023 In FY 2023 and prior years, the STVR was awarded based on a performance period aligned with the financial year (July to June). However, from FY24, the STVR will run on a performance cycle based on the calendar year. As such, the STVR for executive KMP will be based on performance period running from January to December going forward. For all KMP where existing incentive plans are based on the financial year (July to June), awards will be pro-rated to allow for transition to a performance period that runs over the calendar year. Lake Resources NL Directors' report For the year ended 30 June 2023 Remuneration report (audited) (continued) EXECUTIVE REMUNERATION FRAMEWORK (continued) Short-term Variable Remuneration (STVR) Plan Subject to the terms of their service contract, executive KMP are eligible for participation in the STVR Plan which is awarded based on annual performance against defined performance objectives. Details of the STVR opportunity is set for each executive as follows: Table 5: Details of STVR Award KMP Delivery (Cash/ Performance Shares (PS)) Max award Performance Metrics (Cash Component) Performance metrics (deferred Performance Shares Component) D. Dickson Cash: 100% PS: 0% USD 400,000 per annum P. Neilsen Cash: 33.34% PS: 66.66% AUD 65,000 (for first year of service)(1) N. Lindsay Cash: 50% PS: 50% G. Parimoo Cash: 50% PS: 50% AUD 60,000 (for first year of service)(1) AUD 60,000 (for first year of service)(1) The Board has set a number of KPIs to be considered in determining the STVR for Mr Dickson, which are outlined on table 6. At the time of publishing the Company has accrued for a 100% of eligible award on pro-rata basis. During the first year of employment, the following targets were set: • 40%: Delivering comprehensive accounting information with quality timely information in Argentina and at head company level. • 60%: Closing the debt financing for the Company’s Kachi project. Mr. Neilsen will be transitioning to a performance period based on the calendar year from July 2023 and new KPIs have been set which are outlined on table 6. Delivery of a definitive feasibility study (DFS) at the Company’s Kachi Project and financing for the Project being approved. Delivery of a definitive feasibility study (DFS) at the Company’s Kachi Project and financing for the Project being approved. The performance metric was not achieved in FY 2023. No Performance Shares were awarded from the STVR plan during FY23. For details regarding Performance Shares granted in prior years under the STVR that may impact the remuneration of executive KMP in coming years, refer to share-based compensation section of the Remuneration Report (1) (2) Max award represents the maximum value of STVR outlined in the applicable executive’s service agreement during their first year of service from appointment. For details regarding the status of performance shares granted to executive KMP under the STVR including information regarding achievement of performance metrics, please refer to Table 7. 28 29 4141 Lake Resources NL Directors' report For the year ended 30 June 2023 Remuneration report (audited) (continued) EXECUTIVE REMUNERATION FRAMEWORK (continued) Short-term Variable Remuneration (STVR) Plan (continued) KPIs for Executive KMP (Calendar Year 2023) Due to the transition to a calendar-based performance period (rather than the financial year), the Board has approved the below KPIs for assessing the performance of executive KMP (CEO and CFO) during the 2023 calendar year. All incentive awards are subject to discretionary adjustments that are to be approved by the Board. Table 6: KPI for Executive KMP Metric Safety Details • Complete review of current Health, Safety and Environmental processes, systems and practices • Implement consistent policies and establish management of change process and system for project site and global operations People Financial Operations • Build experienced management team to cover key operations and functional areas • Develop 12-month budget and cash flow forecast • Maintain cash balance of USD 35 million • Complete operational review • Submit Phase 1 definitive feasibility study (DFS) in 2023 Additional targets Weighting • Target zero fatalities 10% • Recruit, onboard and develop executive committee that works together as a team 20% 30% 40% FY23 STVR Performance Shares In FY23, Performance Shares were not granted to any KMP as a part of their STVR award. However, for FY22, pursuant to resolution 12 dated 25 January 2022 (and issued 24 February 2022), approval to issue Performance Shares was granted for the CFO (Mr. Peter Neilsen) and Executive Technical Director (Dr. Nicholas Lindsay), which may impact the pay of executive KMP in future years. A summary is provided in Table 7 below. 42 30 LAKE RESOURCES ANNUAL REPORT 2023 Lake Resources NL Directors' report For the year ended 30 June 2023 Remuneration report (audited) (continued) EXECUTIVE REMUNERATION FRAMEWORK (continued) Short-term Variable Remuneration (STVR) Plan (continued) KPIs for Executive KMP (Calendar Year 2023) Due to the transition to a calendar-based performance period (rather than the financial year), the Board has approved the below KPIs for assessing the performance of executive KMP (CEO and CFO) during the 2023 calendar year. All incentive awards are subject to discretionary adjustments that are to be approved by the Board. Table 6: KPI for Executive KMP Metric Details Additional targets Weighting Safety • Implement consistent policies and establish • Target zero fatalities 10% • Complete review of current Health, Safety and Environmental processes, systems and practices management of change process and system for project site and global operations • Build experienced management team to cover key operations and functional areas • Develop 12-month budget and cash flow forecast • Maintain cash balance of USD 35 million • Complete operational review People Financial Operations • Submit Phase 1 definitive feasibility study (DFS) in 2023 FY23 STVR Performance Shares • Recruit, onboard and develop executive committee that works together as a team 20% 30% 40% In FY23, Performance Shares were not granted to any KMP as a part of their STVR award. However, for FY22, pursuant to resolution 12 dated 25 January 2022 (and issued 24 February 2022), approval to issue Performance Shares was granted for the CFO (Mr. Peter Neilsen) and Executive Technical Director (Dr. Nicholas Lindsay), which may impact the pay of executive KMP in future years. A summary is provided in Table 7 below. Lake Resources NL Directors' report For the year ended 30 June 2023 Remuneration report (audited) (continued) EXECUTIVE REMUNERATION FRAMEWORK (continued) Short-term Variable Remuneration (STVR) Plan (continued) FY23 STVR Performance Shares (continued) Table 7: Details of Performance Shares Granted under STVR Award Recipient / Performance Share Max number of ordinary shares that Performance Shares can be converted to P. Neilsen (Class A) 123,809 Dr. N. Lindsay (Class E) 92,343 Performance Measure Maximum Weighting Grant Date Measurement Period Expiry Date Status Delivering comprehensive accounting information with quality timely information in Argentina and head company levels Closing the debt financing for the Company’s Kachi project Commencement of exploration and testing of brines from at least one of the Company’s other projects besides the Kachi project 40% 22 Feb 2022 12 Jul 2021 – 12 Oct 2022 12 Dec 2022 Expired 60% 22 Feb 2022 12 Jul 2021 – 12 Oct 2022 12 Dec 2022 Expired 100% 22 Feb 2022 1 Jan 2021 – 1 April 2022 1 Jun 2022 Vested Paid out at a value of A$35,911 during FY22 (1) Dr. Nicholas Lindsay retired from the Company as of 28 November 2022, however achieved the relevant performance measure for the Class E Performance Shares during his tenure. However, due to administrative matters, the relevant Class E Performance Shares were not converted into ordinary shares of the Company. As such, the Company issued 21,837 shares in lieu of the 2022 Annual General Meeting of Shareholders. the Class E Performance Shares after securing shareholder approval at The Compensation Committee will assess whether the relevant Executive KMP satisfy the performance measures set for the relevant STVR awards within the relevant assessment periods. No grants of Performance Shares that have an impact on the remuneration of Mr. Dickson for the current and future financial years were made. 30 31 4343 Lake Resources NL Directors' report For the year ended 30 June 2023 Remuneration report (audited) (continued) EXECUTIVE REMUNERATION FRAMEWORK (continued) Short-term Variable Remuneration (STVR) Plan (continued) Calculation Method for Conversion of Performance Shares Awarded Under STVR The number of shares to be granted to the executive KMP who are participants in the STVR and are eligible for Performance Shares will be calculated using the following formulae: Table 8: STVR Award Calculation Method P. Neilsen (Target PS x Max STVR x Performance Achieved %)/ VWAP N. Lindsay (Base Pay x Performance Achieved %)/ VWAP Number of shares converted = Where: Target PS (Performance shares)1=2/3 of STVR awarded in Performance Shares Base pay1= the max amount payable in Performance Shares under the STVR (A$32,320), which is 50% of the STVR opportunity Performance achieved %1= Percentage assessed by the Company’s Compensation Committee according to assessment of the Recipient's achievement of the relevant performance measures over the performance period up to the relevant maximum weighting outlined in table 5 VWAP:1the volume weighted average price of the Company’s Shares traded on ASX during the 20 trading days prior to the date of conversion of the relevant Performance Share. For Performance Shares issues to Dr. Lindsay, the maximum number of ordinary shares assumes that the VWAP Price under the Lindsay Conversion Formula set out above is A$0.35 (VWAP Floor Price). If the VWAP Price is lower than the VWAP Floor Price, no more than the maximum number of ordinary shares approved by Shareholders under Resolution 13 of the January 2022 general meeting of shareholders will be issued. 44 32 LAKE RESOURCES ANNUAL REPORT 2023 Lake Resources NL Directors' report For the year ended 30 June 2023 Remuneration report (audited) (continued) EXECUTIVE REMUNERATION FRAMEWORK (continued) Short-term Variable Remuneration (STVR) Plan (continued) Calculation Method for Conversion of Performance Shares Awarded Under STVR The number of shares to be granted to the executive KMP who are participants in the STVR and are eligible for Performance Shares will be calculated using the following formulae: Table 8: STVR Award Calculation Method Number of shares (Target PS x Max STVR x Performance (Base Pay x Performance Achieved %)/ P. Neilsen Achieved %)/ VWAP N. Lindsay VWAP converted = Where: STVR opportunity Target PS (Performance shares)1=2/3 of STVR awarded in Performance Shares Base pay1= the max amount payable in Performance Shares under the STVR (A$32,320), which is 50% of the Performance achieved %1= Percentage assessed by the Company’s Compensation Committee according to assessment of the Recipient's achievement of the relevant performance measures over the performance period up to the relevant maximum weighting outlined in table 5 VWAP:1the volume weighted average price of the Company’s Shares traded on ASX during the 20 trading days prior to the date of conversion of the relevant Performance Share. For Performance Shares issues to Dr. Lindsay, the maximum number of ordinary shares assumes that the VWAP Price under the Lindsay Conversion Formula set out above is A$0.35 (VWAP Floor Price). If the VWAP Price is lower than the VWAP Floor Price, no more than the maximum number of ordinary shares approved by Shareholders under Resolution 13 of the January 2022 general meeting of shareholders will be issued. Lake Resources NL Directors' report For the year ended 30 June 2023 Remuneration report (audited) (continued) EXECUTIVE REMUNERATION FRAMEWORK (continued) Long-term Variable Remuneration (LTVR) Plan Subject to the terms of their service contract, executive KMP are eligible for the LTVR Plan as an incentive to participate in the Company’s growth that is directly aligned with the creation of shareholder value. Table 9: Details of LTVR Award KMP D. Dickson P. Neilsen N. Lindsay G. Parimoo Delivery Max award Performance metrics (Performance Shares) • Performance Shares • Delivered in tranches over three years subject to achievement of the relevant performance hurdles USD 600,000 per annum AUD 65,000 per annum for three years after commencement Up to 40% of the annual value of Base Pay and Benefits at time of commencement Up to 40% of the annual value of Base Pay and Benefits at time of commencement For details regarding Performance Shares granted in the current and prior years under the LTVR that may impact the remuneration of executive KMP in coming years, refer to table 10 Mr. Dickson’s LTVR is awarded in performance shares based on achievement of scorecard KPIs that are updated on an annual basis and vest in equal tranches over three-years. The scorecard KPI for the current calendar year are based on the metrics outlined in Table 6. Performance Shares granted to Mr. Neilsen and Dr. Lindsay under the LTVR, and the relevant performance hurdles attached to each tranche are outlined below. The status of these awards and the achievement of the relevant hurdles have been outlined under “performance shares” in the Share-Based Payments section of this report. 32 33 4545 Lake Resources NL Directors' report For the year ended 30 June 2023 Remuneration report (audited) (continued) EXECUTIVE REMUNERATION FRAMEWORK (continued) Long-term Variable Remuneration (LTVR) Plan (continued) Table 10: Details of Performance Shares Granted under LTVR Award Performance Share Max number of ordinary shares that Performance Shares can be converted to P. Neilsen LTVR Tranche 1 (Class B) 139,285 P. Neilsen LTVR Tranche 2 (Class C) 92,343 P. Neilsen LTVR Tranche 3 (Class D) N. Lindsay LTVR Tranche 1 (Class F) N. Lindsay LTVR Tranche 2 (Class G) 250,714 147,749 147,749 N. Lindsay LTVR Tranche 3 (Class H) 73,874 Performance Measure Max Weight Grant Date Measurement Period Expiry Date Delivering and operating a comprehensive reporting package for the debt financiers and potential JV partners post close of the Kachi project finance Maintain and deliver accurate reporting across all facets of the business incorporating cash flows, reproduction and budgeting. Preparation of financial documents to the satisfaction of financiers, project banking syndicates and export credit agencies Implementation and maintenance of acceptable budgetary and cash flow measures across Australia and Argentina Delivery of the Kachi project into production with appropriate reporting mechanisms in place The Company putting a project team in place to build the Project DFS and building the demonstration plant on site The Company closing the debt and equity financing for the Company’s Kachi project on terms satisfactory to the Company The Company receiving approval for the financing of an expansion case being up to 50,000 tonnes per annum lithium carbonate equivalent total production at the Kachi project 25% 22 Feb 2022 12 Jul 2021 – 12 Oct 2022 12 Mar 2023 30% 22 Feb 2022 12 Jul 2021 – 12 Jul 2023 12 Sep 2023 45% 40% 40% 20% 22 Feb 2022 22 Feb 2022 22 Feb 2022 22 Feb 2022 12 Jul 2021 – 12 Jul 2024 12 Sep 2024 1 Jan 2021 – 1 Apr 2022 1 Jun 2022 1 Jan 2021 – 1 Jan 2023 1 Mar 2023 1 Jan 2021 – 1 Jan 2024 1 Mar 2024 46 34 LAKE RESOURCES ANNUAL REPORT 2023 Lake Resources NL Directors' report For the year ended 30 June 2023 Remuneration report (audited) (continued) EXECUTIVE REMUNERATION FRAMEWORK (continued) Long-term Variable Remuneration (LTVR) Plan (continued) Table 10: Details of Performance Shares Granted under LTVR Award Max number of ordinary shares that Performance Shares can be converted to Performance Share Performance Measure Max Weight Grant Date Measurement Expiry Period Date P. Neilsen LTVR 139,285 for the debt financiers and potential 25% Tranche 1 (Class B) 22 Feb 2022 12 Jul 2021 – 12 Oct 2022 12 Mar 2023 Delivering and operating a comprehensive reporting package JV partners post close of the Kachi project finance Maintain and deliver accurate reporting across all facets of the business incorporating cash flows, reproduction and budgeting. Preparation of financial documents to the satisfaction of financiers, project banking syndicates and export credit agencies Implementation and maintenance of acceptable budgetary and cash flow measures across Australia and Argentina P. Neilsen LTVR Tranche 2 (Class C) 92,343 30% 22 Feb 2022 12 Jul 2021 – 12 Jul 2023 12 Sep 2023 P. Neilsen LTVR Delivery of the Kachi project into 250,714 production with appropriate reporting 45% Tranche 3 (Class D) N. Lindsay (Class F) N. Lindsay (Class G) LTVR Tranche 1 147,749 LTVR Tranche 2 147,749 mechanisms in place The Company putting a project team in place to build the Project DFS and building the demonstration plant on site The Company closing the debt and equity financing for the Company’s Kachi project on terms satisfactory to the Company The Company receiving approval for the financing of an expansion case 40% 40% 20% N. Lindsay LTVR Tranche 3 (Class H) 73,874 being up to 50,000 tonnes per annum lithium carbonate equivalent total production at the Kachi project 22 Feb 2022 22 Feb 2022 22 Feb 2022 22 Feb 2022 12 Jul 2021 – 12 Jul 2024 12 Sep 2024 1 Jan 2021 – 1 Apr 2022 1 Jun 2022 1 Jan 2021 – 1 Jan 2023 1 Mar 2023 1 Jan 2021 – 1 Jan 2024 1 Mar 2024 34 Lake Resources NL Directors' report For the year ended 30 June 2023 Remuneration report (audited) (continued) EXECUTIVE REMUNERATION FRAMEWORK (continued) Long-term Variable Remuneration (LTVR) Plan (continued) Calculation Method for Conversion of Performance Shares Awarded Under LTVR The number of shares to be granted to the executive KMP who are participants in the LTVR and are eligible for Performance Shares will be calculated using the formula in Table 11. Table 11: LTVR Award Calculation Method (Target PS x Max STVR x Performance Achieved %)/ VWAP LTVR Calculation Method Number of shares converted = Where: Base pay1= the max amount payable in Performance Shares under the LTVR (A$195,000 for Mr Neilsen’s Class B, C and D Performance Shares; and AUD129,280.80 for Dr Lindsay’s Class F, G and H Performance Shares) Performance achieved %1= Percentage assessed by the Company’s Compensation Committee according to assessment of the Recipient's achievement of the relevant performance measures over the measure period up to the relevant maximum weighting outlined in table 9 VWAP:1the volume weighted average price of the Company’s Shares traded on ASX during the 20 trading days prior to the date of conversion of the relevant Performance Share. For Performance Shares issues to Dr. Lindsay (class F, G and H Performance Shares), the maximum number of ordinary shares assumes that the VWAP Price under the Lindsay Conversion Formula set out above is A$0.35 (VWAP Floor Price). If the VWAP Price is lower than the VWAP Floor Price, no more than the maximum number of ordinary shares approved by Shareholders under Resolution 13 of the January 2022 general meeting of shareholders will be issued. Long- term Incentive Plan - Performance Rights At the 2016 Annual General Meeting, the shareholders of Lake Resources approved 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 Plan is to give incentives to eligible participants (or their nominee) to provide dedicated and ongoing commitment and effort to the Consolidated entity, aligning the interest of both employees and shareholders and for the Consolidated entity to reward eligible employees for their effort. The Plan contemplates the issue to eligible employees of performance rights which may have milestones. Mr. Crow was awarded 5 million performance rights on 15 August 2019. These performance rights will vest in full when the relevant performance measures have been satisfied, namely: • an investment partner signing an agreement to invest in the Kachi project in Catamarca (Investor) At the time of reporting, Mr. Crow’s performance rights vesting condition has not been met. 35 4747 Lake Resources NL Directors' report For the year ended 30 June 2023 Remuneration report (audited) (continued) EXECUTIVE REMUNERATION FRAMEWORK (continued) Long- term Incentive Plan - Performance Rights (continued) Mr. Promnitz (former Director) and Dr. Lindsay (former Director) were each awarded 5 million performance rights on 15 August 2019 and all performance rights have vested due to achievement of the relevant performance measures as follows: Table 12: Performance Rights on Issue Recipient Grant Date N. Lindsay 15 Aug 2019 Number of Rights Granted 2,500,000 S. Promnitz 15 Aug 2019 2,500,000 N. Lindsay 15 Aug 2019 2,500,000 S. Promnitz 15 Aug 2019 2,500,000 Use of Other Remuneration Elements Performance Measure Performance Outcome Status Completion of Pre-Feasibility Study for the Kachi Project Establishment of a Pilot Plant on-site at Kachi Project in Catamarca Achieved Shares issued Achieved Shares issued Achieved Shares issued Achieved Expired To recruit top executive talent or to replace benefits or compensation forfeited when newly hired executives left their previous employer to join Lake Resources, some newly hired executives are provided sign-on bonuses. To ensure alignment with shareholders, these bonuses are typically made in the form of stock options or restricted stock units and are designed to comply with all relevant ASX listing rules. The primary purpose of granting stock-based awards (RSUs) is to provide an incentive to meet all critical project milestones and to ensure the value of the awards is based on the Company’s share price in addition to ensuring retention of executives critical to the achievement of strategic goals. Where stock awards are not performance based, the intention is for KMP to hold a certain amount of Company stock to enhance interests with shareholders. Stock options have been granted due to their prevalence in the US and to reflect our shift to expand our executive, operations and technical leadership in the US. Of the current executive KMP, the following stock compensation has been provided as sign-on awards: 48 36 LAKE RESOURCES ANNUAL REPORT 2023 Lake Resources NL Directors' report For the year ended 30 June 2023 Remuneration report (audited) (continued) EXECUTIVE REMUNERATION FRAMEWORK (continued) Long- term Incentive Plan - Performance Rights (continued) Mr. Promnitz (former Director) and Dr. Lindsay (former Director) were each awarded 5 million performance rights on 15 August 2019 and all performance rights have vested due to achievement of the relevant performance measures as follows: Table 12: Performance Rights on Issue Recipient Grant Date Performance Measure Performance Outcome Status Number of Rights Granted N. Lindsay 15 Aug 2019 2,500,000 S. Promnitz 15 Aug 2019 2,500,000 Completion of Pre-Feasibility Study for the Kachi Project Achieved Shares issued Achieved Shares issued N. Lindsay 15 Aug 2019 2,500,000 Establishment of a Pilot Plant Achieved Shares issued S. Promnitz 15 Aug 2019 2,500,000 Catamarca Achieved Expired on-site at Kachi Project in Use of Other Remuneration Elements To recruit top executive talent or to replace benefits or compensation forfeited when newly hired executives left their previous employer to join Lake Resources, some newly hired executives are provided sign-on bonuses. To ensure alignment with shareholders, these bonuses are typically made in the form of stock options or restricted stock units and are designed to comply with all relevant ASX listing rules. The primary purpose of granting stock-based awards (RSUs) is to provide an incentive to meet all critical project milestones and to ensure the value of the awards is based on the Company’s share price in addition to ensuring retention of executives critical to the achievement of strategic goals. Where stock awards are not performance based, the intention is for KMP to hold a certain amount of Company stock to enhance interests with shareholders. Stock options have been granted due to their prevalence in the US and to reflect our shift to expand our executive, operations and technical leadership in the US. Of the current executive KMP, the following stock compensation has been provided as sign-on awards: Lake Resources NL Directors' report For the year ended 30 June 2023 Remuneration report (audited) (continued) EXECUTIVE REMUNERATION FRAMEWORK (continued) Use of Other Remuneration Elements (continued) Table 13: Other Remuneration Elements 2023 KMP Commencement date Type of Grant Number of Stock Conditions D. Dickson 15-Sep-22 Stock Options 4,000,000 15-Sep-22 Restricted Stock Units 1,000,000 P. Neilsen 12-Jul-21 Stock Options 2,000,000 G. Parimoo 14-Oct-21 Stock Options 2,000,000 subject the commencement date, Each of the RSUs and the Options will vest in 25% increments on the first four anniversaries of to employment through to the applicable vesting date. Options are exercisable for up to three years from the commencement date, with each option exercisable into one ordinary share at an exercise price equal to a 50% premium to market price at the Commencement Date (A$0.55). Options are exercisable for up to three years from the commencement date, with each option exercisable into one ordinary share at an exercise price equal to a 50% premium to market price at the Commencement Date (A$0.57). Mr. Parimoo ceased his position 9 January 2023. 1 For details regarding the specific shareholdings and movements of executive KMP (including fair value of sign-on awards) in the past year, please refer to the Share-Based Payments section of this report. In addition to the above, during FY23, Mr. Neilsen was provided a one-off discretionary cash payment, which does not form part of his regular remuneration framework of A$200,000 awarded on 10 October 2022, to reflect his contribution to reviewing and resetting the project plan for Kachi Project aiming for plant capacity of 50,000 tonnes per annum by 2030. In addition to the elements outlined in the Remuneration Framework above, the Board and the Committee also consider the following elements when making remuneration decisions, including when establishing pay levels for KMP and other executives. 36 37 4949 Lake Resources NL Directors' report For the year ended 30 June 2023 Remuneration report (audited) (continued) EXECUTIVE REMUNERATION FRAMEWORK (continued) Use of Other Remuneration Elements (continued) Table 14: Other Key Considerations Overview In addition to statutory benefits such as superannuation, reasonable benefits and allowances will be provided for expenses required for business purposes and to undertake the relevant executive’s role. These may include reimbursement of home office costs, reasonable travel allowances and appropriate relocation allowances. Mr. Dickson is also entitled to matching 401(k) contributions in the US. While Sustainability and Risk are not formulaically current reflected in these matters are incentive plans, when Board the by considered establishing the business plan, setting performance assessing corporate and executive performance for compensation purposes. The Board expects that all Company directors, KMP and senior executives should have substantial ownership of Company stock. goals, and Board stock has The ownership (minimum guidelines shareholding requirement) that will take effect from January 2024. approved Considerations such as Benefits beyond statutory benefits leave are provided superannuation and annual within the limits of local laws and regulations and considers market practice and are only provided where they address business needs. Lake Resources acknowledges the heightened environmental risk that the Company faces due to the nature of its business. As a part of Lake Resources’ updated strategy, several sustainability and Risk matters have been identified as particularly material to the business are which will be considered in the design of incentive plans and in remuneration decisions. accumulate The share ownership guidelines will require the relevant KMP to a minimum shareholding level (as indicated below), over a maximum 5- year period (starting from January 2024 or the date of appointment as KMP): • MD/CEO:.200% of base salary • Executive KMP:.100% of base salary • NED:.100% of base fees 38 Fringe Benefits and Allowances Sustainability and Risk in Pay Our view on KMP Share Ownership 50 LAKE RESOURCES ANNUAL REPORT 2023 Lake Resources NL Directors' report For the year ended 30 June 2023 Remuneration report (audited) (continued) EXECUTIVE REMUNERATION FRAMEWORK (continued) Use of Other Remuneration Elements (continued) Table 14: Other Key Considerations Overview In addition to statutory benefits such as superannuation, reasonable benefits and allowances will be provided for expenses Considerations Fringe Benefits and Allowances required for business purposes and to Benefits beyond statutory benefits such as undertake the relevant executive’s role. superannuation and annual leave are provided These may include reimbursement of within the limits of local laws and regulations and home office costs, reasonable travel considers market practice and are only provided allowances and appropriate relocation where they address business needs. allowances. Mr. Dickson is also entitled to matching 401(k) contributions in the US. Sustainability and Risk in Pay Our view on KMP Share Ownership While Sustainability and Risk are not Lake Resources acknowledges the heightened formulaically reflected in current environmental risk that the Company faces due to incentive plans, these matters are the nature of its business. As a part of Lake considered by the Board when Resources’ updated strategy, several sustainability establishing the business plan, setting and Risk matters have been identified as performance goals, and assessing particularly material to the business are which will corporate and executive performance for be considered in the design of incentive plans and compensation purposes. in remuneration decisions. The Board expects that all Company directors, KMP and senior executives should have substantial ownership of Company stock. The share ownership guidelines will require the relevant KMP to accumulate a minimum shareholding level (as indicated below), over a maximum 5- year period (starting from January The Board has approved stock ownership guidelines (minimum shareholding requirement) that will take effect from January 2024. 2024 or the date of appointment as KMP): • MD/CEO:.200% of base salary • Executive KMP:.100% of base salary • NED:.100% of base fees Lake Resources NL Directors' report For the year ended 30 June 2023 Remuneration report (audited) (continued) EXECUTIVE REMUNERATION FRAMEWORK (continued) Use of Other Remuneration Elements (continued) Table 14: Other Key Considerations (continued) Use of Discretion and clawback Considerations As the Company remains in the developmental and exploration phase, there are significant challenges setting meaningful quantitative goals for the the Board purposes of remuneration. As such, retains the ability to apply discretion to the incentive the when performance of individual executives in any given performance period to recognise achievements that are not necessarily reflected in financial / quantitative metrics. the Company or considering awards at and discretion Overview Where necessary, the Board may, in its absolute the recommendation of the Compensation Committee, adjust pay outcomes of KMP and other executives, both downward or upward based on any material event or other considerations that the Board believes should be reflected in the assessment of performance for the individual business units, or Company, individual executives. or cancel In the event of serious misconduct or a material misstatement in the company’s financial statements, the Board may in its discretion defer performance-based remuneration and may also clawback performance-based remuneration paid in previous financial years. These malus and clawback provisions apply to both cash and equity awards, vested or unvested equity and whether or not employment is ongoing. NON-EXECUTIVE DIRECTOR REMUNERATION Remuneration Policy Fees and payments to Non-Executive Directors are set considering the demands, time commitment and responsibilities expected of their role. The Board reviews fees payable to Non-Executive Directors on an annual basis with consideration of market practice and any changes to the expectations of their respective roles. Where considered necessary, the Board may engage external remuneration consultants that are independent of the Board, Company, and management information regarding the pay levels of Non-Executive Directors to/and determine whether fees offered to Lake Resources’ Non-Executive Directors are in line with the market. to procure market Non-Executive Directors are not provided with retirement or termination benefits other than statutory superannuation for Australia resident directors. 38 39 5151 Lake Resources NL Directors' report For the year ended 30 June 2023 Remuneration report (audited) (continued) NON-EXECUTIVE DIRECTOR REMUNERATION (continued) FY23 Non-Executive Director Fee Pool In its review of Non-Executive Director fees, Lake Resources may consider amending the maximum aggregate amount payable in fees to Non-Executive Directors. At the Company’s November 2022 Annual General Meeting, the Board sought and gained shareholder approval to increase the maximum aggregate amount payable in fees (fee pool) to Non-Executive Directors to a maximum of USD1.5 million per annum. Table 15: FY23 Board Fees (USD’000) Fee Description FY23 Fee (per annum) Change from FY22 Board Fees Chair of the Board Other Non-Executive Directors Committee Chair Fees Audit Committee Compensation Committee Nomination & Governance Committee Finance Committee 116 80 20 15 15 15 The fee schedule for Non-Executive Directors were amended from AUD to USD to be aligned with the fees expressed in the letters of appointment for Non-Executive Directors. No other changes were made. Restricted Stock Units for Non-Executive Directors The Company believes that directors of the Company should hold stock in the Company to increase alignment with shareholder interests. Accordingly, in addition to fees, Non-Executive Directors are issued with the equivalent of USD 150,000 value of shares. This is based on the closing price of the Company’s shares on over-the-counter (OTC) on the day prior to announcement of appointment in Restricted Stock Units (RSU). The RSU are a one-off grant at the time of appointment and will vest one-year from the date of appointment. Details of the RSU granted can be found in the Share-Based Payments section and Table 16 below. Table 16: RSU allotted to Non-Executive Directors in FY23 Name C. Bo-Linn H. Atkins A. Gomez Chapman Grant Date 5-Dec-22 5-Dec-22 1-Jan-23 Vesting Date 5-Dec-23 5-Dec-23 1-Jan-24 Number of Units Allotted 232,500 232,500 238,500 52 40 LAKE RESOURCES ANNUAL REPORT 2023 Lake Resources NL Directors' report For the year ended 30 June 2023 Remuneration report (audited) (continued) NON-EXECUTIVE DIRECTOR REMUNERATION (continued) FY23 Non-Executive Director Fee Pool In its review of Non-Executive Director fees, Lake Resources may consider amending the maximum aggregate amount payable in fees to Non-Executive Directors. At the Company’s November 2022 Annual General Meeting, the Board sought and gained shareholder approval to increase the maximum aggregate amount payable in fees (fee pool) to Non-Executive Directors to a maximum of USD1.5 million per annum. Table 15: FY23 Board Fees (USD’000) Fee Description Board Fees Chair of the Board Other Non-Executive Directors Audit Committee Committee Chair Compensation Committee Fees Nomination & Governance Committee Finance Committee Restricted Stock Units for Non-Executive Directors FY23 Fee (per annum) Change from FY22 116 80 20 15 15 15 The fee schedule for Non-Executive Directors were amended from AUD to USD to be aligned with the fees expressed in the letters of appointment for Non-Executive Directors. No other changes were made. The Company believes that directors of the Company should hold stock in the Company to increase alignment with shareholder interests. Accordingly, in addition to fees, Non-Executive Directors are issued with the equivalent of USD 150,000 value of shares. This is based on the closing price of the Company’s shares on over-the-counter (OTC) on the day prior to announcement of appointment in Restricted Stock Units (RSU). The RSU are a one-off grant at the time of appointment and will vest one-year from the date of appointment. Details of the RSU granted can be found in the Share-Based Payments section and Table 16 below. Table 16: RSU allotted to Non-Executive Directors in FY23 Name C. Bo-Linn H. Atkins A. Gomez Chapman Grant Date Vesting Date Number of Units Allotted 5-Dec-22 5-Dec-22 1-Jan-23 5-Dec-23 5-Dec-23 1-Jan-24 232,500 232,500 238,500 Lake Resources NL Directors' report For the year ended 30 June 2023 Remuneration report (audited) (continued) STATUTORY DISCLOSURES The following tables set out the statutory disclosures for the KMP of the Company as required under the Corporations Act 2001 in accordance with the Australian Accounting Standards. FY23 KMP Remuneration Table 17: Statutory remuneration of KMP in FY23 (AUD) Key Management Personnel Directors’ Fees and/or Salary Consulting Fees Annual leave Long Service Leave Post- Employment Benefits Share Based payments Other Benefits9 Performance rights RSU Options Total 2023 Non-Executive Directors S. Crow1 R. Trzebski C. Bo-Linn2 H. Atkins3 A. Gomez Chapman4 N. Lindsay5 A. Saenz6 Executive Directors S. Crow1 D. Dickson7 N. Lindsay5 Executive Management P. Neilsen G. Parimoo8 Total 177,035 114,826 79,089 82,219 69,290 12,000 24,000 478,329 1,193,458 90,716 - - - - - - 142,312 - - - - - - - - - 59,414 - - - 711,480 190,586 3,223,028 - 134,293 - 48,463 142,312 242,170 - - - - - - - - - - - 2,185 4,410 - - - - - - - 66,311 8,135 479,292 23,922 200,000 - - - - - - - - - - - - - - 135,076 - 137,780 - 94,616 - - - - - - - - 381,979 - 1,184,388 (71,823) - - - - 2,185 102,778 679,292 (71,823) 749,451 1,184,388 - - - - - - - - - 177,035 119,236 214,165 219,999 163,906 12,000 166,312 478,329 3,364,842 27,028 - 1,071,880 239,049 - 6,253,781 1 2 3 4 5 6 7 8 9 Mr. Stuart Crow assumed the position of Non-executive Chair of the Board on 5 January 2023 having previously served as executive chair from 20 June 2022 Dr. Cheemin Bo-Linn was appointed as Non-Executive Director effective as of 5 December 2022 Mr. Howard Atkins was appointed as Non-Executive Director effective as of 5 December 2022 Ms. Ana Gomez Chapman was appointed as Non-Executive Director effective as of 1 January 2023 Dr. Nicholas Lindsay ceased the position as Non-Executive Director as of 28 November 2022 having previously served as Technical Director (executive KMP) until 3 October 2022. Ms. Amalia Saenz ceased the position as Non-Executive Director as of 1 February 2023 Mr. David Dickson assumed the position of Managing Director and Chief Executive Officer on 15 September 2022 Mr. Gautam Parimoo ceased their position as COO on 9 January 2023 “Other benefits” include bonus accruals and payouts during the financial year. 40 41 5353 Lake Resources NL Directors' report For the year ended 30 June 2023 Remuneration report (audited) (continued) STATUTORY DISCLOSURES (continued) FY22 KMP Remuneration Table 18: Statutory remuneration of KMP in FY22 (AUD) Key Management Personnel 2022 Non-Executive Directors R. Trzebski A. Saenz1 Executive Directors S. Crow2 S. Promnitz3 N. Lindsay Executive Management P. Neilsen G. Parimoo4 G. Gill5 Total Directors’ Fees and/or Salary Consulting Fees Annual Leave Long Service Leave Post- Employment Benefits Relocation benefits Share Based payments Performance rights Options 64,800 141,000 180,000 355,679 300,000 335,258 249,362 - 1,626,099 23,000 1,545 7,200 - - - - - - - - - - 14,164 1,880 568 - - - - 27,502 24,931 27,502 96,600 186,593 - 155,679 15,419 38,445 - - 108,260 391,453 - - - - - - - 100,000 - - 273,125 (7,188) 251,379 461,248 760,609 - - 232,543 18,157 87,135 100,000 517,316 1,221,857 Total 96,545 141,000 549,725 545,836 780,202 863,022 1,109,971 108,260 4,194,561 - - - - - - 1 2 3 4 5 Ms. Amalia Saenz assumed the position of Non-Executive Director on 28 July 2021 Mr. Stuart Crow assumed the position of executive chair of the Board on 20 June 2022 Mr. Steve Promnitz ceased the position as Managing Director on 17 June 2022 Mr. Parimoo assumed the position of Chief Operating Officer on 35 October 2021. During FY22, Mr. Parimoo received AUD 100,000 in relocation benefits. Mr. Gary Gill ceased their position as Chief Financial Officer and Company Secretary on 13 July 2021 Performance Based Remuneration During FY23 Table 19: Percentages of Remuneration that are Performance Based Name Fixed remuneration 2022 2023 At risk - STVR At risk - LTVR 2023 2022 2023 2022 Non-Executive directors S. Crow R. Trzebski C. Bo-Linn H. Atkins A. Gomez Chapman A. Saenz Executive directors D. Dickson N. Lindsay S. Promnitz Executive Management P. Neilsen G. Parimoo G. Gill 100% 100% 100% 100% 100% 100% 50% 100% 0% 80% 100% 0% 50% 100% 0% 0% 0% 100% 0% 65% 100% 47% 31% 100% 0% 0% 0% 0% 0% 0% 20% 0% 0% 10% 0% 0% 0% 0% 0% 0% 0% 0% 0% 5% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 30% 0% 0% 10% 0% 0% 50% 0% 0% 0% 0% 0% 0% 30% 0% 53% 69% 0% 42 54 LAKE RESOURCES ANNUAL REPORT 2023 Lake Resources NL Directors' report For the year ended 30 June 2023 Remuneration report (audited) (continued) STATUTORY DISCLOSURES (continued) FY22 KMP Remuneration Table 18: Statutory remuneration of KMP in FY22 (AUD) Key Management Fees and/or Consulting Annual Service Employment Relocation Performance Directors’ Long Post- Share Based payments Personnel Salary Fees Leave Leave Benefits benefits rights Options Total Non-Executive Directors Executive Directors 2022 R. Trzebski A. Saenz1 S. Crow2 S. Promnitz3 N. Lindsay P. Neilsen G. Parimoo4 G. Gill5 Total Executive Management 64,800 141,000 180,000 355,679 300,000 335,258 249,362 - 1,626,099 - - - - 108,260 391,453 23,000 1,545 7,200 96,600 - 155,679 186,593 15,419 14,164 1,880 27,502 24,931 - - - - - - - - - - - - - - - - - - - 273,125 (7,188) 251,379 - - - - - - - - - - 96,545 141,000 549,725 545,836 780,202 863,022 1,109,971 108,260 4,194,561 38,445 568 27,502 100,000 461,248 760,609 232,543 18,157 87,135 100,000 517,316 1,221,857 1 2 3 4 5 Ms. Amalia Saenz assumed the position of Non-Executive Director on 28 July 2021 Mr. Stuart Crow assumed the position of executive chair of the Board on 20 June 2022 Mr. Steve Promnitz ceased the position as Managing Director on 17 June 2022 Mr. Parimoo assumed the position of Chief Operating Officer on 35 October 2021. During FY22, Mr. Parimoo received AUD 100,000 in relocation benefits. Mr. Gary Gill ceased their position as Chief Financial Officer and Company Secretary on 13 July 2021 Performance Based Remuneration During FY23 Table 19: Percentages of Remuneration that are Performance Based Fixed remuneration 2023 2022 At risk - STVR At risk - LTVR 2023 2022 2023 2022 Name Non-Executive directors A. Gomez Chapman A. Saenz Executive directors S. Crow R. Trzebski C. Bo-Linn H. Atkins D. Dickson N. Lindsay S. Promnitz P. Neilsen G. Parimoo G. Gill Executive Management 100% 100% 100% 100% 100% 100% 50% 100% 0% 80% 100% 0% 50% 100% 0% 0% 0% 100% 0% 65% 100% 47% 31% 100% 0% 0% 0% 0% 0% 0% 20% 0% 0% 10% 0% 0% 0% 0% 0% 0% 0% 0% 0% 5% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 30% 0% 0% 10% 0% 0% 50% 0% 0% 0% 0% 0% 0% 30% 0% 53% 69% 0% 42 Lake Resources NL Directors' report For the year ended 30 June 2023 Remuneration report (audited) (continued) SERVICE AGREEMENTS Non-Executive KMP Non-Executive Directors’ service to Lake Resources is formalised through an appointment letter and appointments are subject to the provisions of the Company’s constitution and ratification of appointments by shareholder vote at the Company’s Annual General Meeting (AGM) as required by the relevant ASX listing rules. Non-Executive Directors may terminate their directorship at any time through notifying the Board of the effective date for resignation. Directors are remunerated through a basic retainer for services to the Board in addition to Committee fees based on their service to the applicable committees. Fees are set by the Board to reflect the demands and responsibilities of their roles. In addition, directors are granted RSU in the Company at the time of appointment with a view to increase alignment of interests with shareholders. Please refer to the Non-Executive Directors’ Remuneration section of this report for details regarding the fees and other awards payable to non-executive KMP. Executive KMP Remuneration of executive key management personnel referenced within the Remuneration Report are formalised through service agreements. Key terms from the service agreements as required in the Corporations Act of personnel that held executive KMP positions during FY23 are summarised below: Table 20: Key Service Agreement Terms KMP Commencement date Contract term Executive Notice Company Notice1 EXECUTIVE KMP David Dickson3 Peter Neilsen Stuart Crow Nicholas Lindsay4 1 Jan 2021 Gautam Parimoo5 25 Oct 2021 15 Sep 2022 30 days 3 months 12 Jul 2021 Mr Crow ceased to be an executive KMP upon transitioning to the role of non-executive chair of the Board on 5 January 2023 4-years from date of commencement2 3-years from date of commencement 30 days 3 months Until terminated Until terminated 3 months 3 months 3 months 3 months 1 2 3 4 5 Lake Resources may elect to terminate the contract immediately by making a payment calculated in proportion to the executive KMP’s base salary and benefits for any period of short notice in lieu of notice The initial term of Mr. Dickson’s contract is four years, however on each subsequent anniversary of the commencement date, the contract term is automatically extended by an additional one year unless either the Company or Mr. Dickson provides notice to the other party no less than 60 days in advance of the expiration of the term Mr. Dickson’s service agreement provides that, in the case of termination without cause or following resignation for a ’good reason’, the executive is entitled (subject to any restrictions under applicable law and the requirements of the ASX Listing Rules) to the amount of the Annual Bonus for the previous calendar year in a lump sum; and an amount in cash equal to eighteen (18) months base salary; or in the case of termination without cause or resignation for a ‘good reason’ (including a material diminution in the executive’s responsibility or authority) in a defined period before or in the twelve months following a change of control event, the executive is entitled (subject to any restrictions under applicable law and the requirements of the ASX Listing Rules), to the amount of the Annual Bonus for the previous calendar year in a lump sum; and an amount in cash equal to two and one-half the sum of: the base salary as in effect immediately before the termination, and the maximum annual incentive opportunity payable under the executive’s service agreement (including full vesting of all outstanding Options and RSUs). Lake Resources acknowledges that such payments are subject to the requirements of the ASX Listing Rules and may be in excess of the limits prescribed by the Corporations Act 2001 (Cth),and would thereby seek shareholder approval for any termination benefit payable in excess of these limits. Dr. Nicholas Lindsay ceased their position as Non-Executive Director as of 28 November 2022 having previously served as Technical Director (executive KMP) until 3 October 2022. Mr. Parimoo ceased his position as COO on 9 January 2023 Key management personnel have no entitlement misconduct. to termination benefit payments in the event of removal for 43 5555 Lake Resources NL Directors' report For the year ended 30 June 2023 Remuneration report (audited) (continued) SERVICE AGREEMENTS (continued) Executive KMP (continued) Service agreements for incumbent executive KMP Name Position Agreement commenced 15 September 2022 Terms of agreement D. Dickson Managing Director/Chief Executive Officer Term:.4 years from date of appointment Base Salary:.Mr. Dickson’s employment contract contains agreed compensation being a base salary of USD 1 million per annum, which automatically extends by an additional year unless either the Consolidated entity or Mr. Dickson provides notice to the other party at least 60 days before the expiration of the term Sign-on bonus:.Upon appointment, Mr. Dickson was granted 1 million restricted stock units and 4,000,000 stock options that vest in equal tranches over 4-years (25% per annum) STVR (Short-term variable remuneration):.Maximum annual incentive opportunity of 40% of base salary delivered in cash LTVR (Long-term variable remuneration):.Maximum LTI opportunity of 60% of base salary granted in Performance Shares which will be granted in equal instalments over three (3) years Termination: In the case of termination without cause or following resignation for a ‘good reason’, Mr. Dickson will be entitled to an aggregate payment equivalent to the maximum amount that may be paid to an employee under the Corporations Act and ASX Listing Rules without prior shareholder approval; and he will otherwise be entitled to further payments in excess of this amount, subject to shareholder approval, as described in bullet point (3) in Table 20 above. 56 44 LAKE RESOURCES ANNUAL REPORT 2023 Lake Resources NL Directors' report For the year ended 30 June 2023 Remuneration report (audited) (continued) SERVICE AGREEMENTS (continued) Executive KMP (continued) Service agreements for incumbent executive KMP Name Position D. Dickson Managing Director/Chief Executive Officer Agreement commenced 15 September 2022 Terms of agreement Term:.4 years from date of appointment Base Salary:.Mr. Dickson’s employment contract contains agreed compensation being a base salary of USD 1 million per annum, which automatically extends by an additional year unless either the Consolidated entity or Mr. Dickson provides notice to the other party at least 60 days before the expiration of the term Sign-on bonus:.Upon appointment, Mr. Dickson was granted 1 million restricted stock units and 4,000,000 stock options that vest in equal tranches over 4-years (25% per annum) STVR (Short-term variable remuneration):.Maximum annual incentive opportunity of 40% of base salary delivered in cash LTVR (Long-term variable remuneration):.Maximum LTI opportunity of 60% of base salary granted in Performance Shares which will be granted in equal instalments over three (3) years Termination: In the case of termination without cause or following resignation for a ‘good reason’, Mr. Dickson will be entitled to an aggregate payment equivalent to the maximum amount that may be paid to an employee under the Corporations Act and ASX Listing Rules without prior shareholder approval; and he will otherwise be entitled to further payments in excess of this amount, subject to shareholder approval, as described in bullet point (3) in Table 20 above. Lake Resources NL Directors' report For the year ended 30 June 2023 Remuneration report (audited) (continued) SERVICE AGREEMENTS (continued) Executive KMP (continued) Service agreements for incumbent executive KMP (continued) Name Position Agreement commenced 11 July 2021 Term of agreement P. Neilsen Chief Financial Officer Term:.3 years from date of appointment Base Salary:.Commenced at AUD 330,000 per annum inclusive of statutory superannuation. Mr. Neilsen’s remuneration increased to USD 500,000 plus superannuation effective 1 August 2022. Sign-on bonus:.2 million options with exercise price of 50% greater than market price at commencement date and expiry of 3 years from commencement date. Incentives:.Mr. Neilsen’s remuneration package entitles him to participate in the performance based short-term and long-term variable remuneration plans of the Consolidated entity. STVR (Short-term variable remuneration):.Maximum entitlement to STVR will be approximately 20% of Base Pay and Benefits up to a maximum value of AUD 65,000 in the first year of the Term. The STVR package will comprise one third in cash and two thirds in a grant of Performance Shares LTVR (Long-term variable remuneration):.Maximum entitlement to LTVR will be approximately 20% of Base Pay and Benefits, up to a maximum value of AUD 195,000 per year for the three years after the Commencement Date. The LTVR package will comprise a grant of Performance Shares in tranches over three years. The associated performance hurdles and weighting will be: (1) Tranche 1 (25%):.measured no later than 18 months after the Commencement Date - delivering and operating a comprehensive reporting package for the debt financiers and potential JV partners post Project finance close (2) Tranche 2 (30%):.for the second tranche, measured at the end of the second year after the Commencement Date - as agreed in consultation with you (or, failing agreement, as determined by us, acting reasonably) (3) Tranche 3 (45%):.measured at the end of the third year after the Commencement Date - delivery of the Project into production with appropriate reporting mechanisms in place 44 45 5757 Lake Resources NL Directors' report For the year ended 30 June 2023 Remuneration report (audited) (continued) SERVICE AGREEMENTS (continued) Executive KMP (continued) Service agreements for incumbent executive KMP (continued) Name Position Agreement commenced Terms of agreement Additional Performance Shares: Mr. Neilsen was granted 680,705 Performance Shares as compensation for services rendered during the year. This grant was approved by shareholders at the general meeting of shareholders held 25 January 2022. Retention Award: Mr. Neilsen was also provided a one-off cash payment of A$200,000 in light of his contribution to reviewing and resetting the Kachi project plan. Termination: If termination notice is given by the Company, the Company shall be liable to pay full compensation for a three-month notice period. If notice is given by the executive, the notice period is three months. The Consolidated entity shall have the right to choose whether the executive works his notice period or is paid in lieu of notice. S. Crow Executive Chairman 2016 (ceased on 5 January 2023, upon transition to non-executive chair of the Board role) Term:.Until terminated Nature of Services:.Chairman of the Lake Resources NL Board, in addition to external consultant for financing and marketing related services. Remuneration:.During his appointment as Executive Chairman for an estimated 6-month period (from 20 June 2022), Mr. Crow received director fees equivalent to AUD 1 million per annum. The revised remuneration was approved and later confirmed at a Board meeting on 9 August 2022. Following his transition to non-executive chair of the Board on 20 December 2022, Mr. Crow was subject to the service agreements applicable to Non-Executive Directors and the remuneration payable is based on the fee structure for Non-Executive Directors outlined on Table 15. Share-Based Remuneration:.Mr. Crow was granted 5,000,000 performance rights pursuant to approval at a shareholder meeting held on 15 August 2019, which are currently still held at the date of this report. Termination:.There is a 1 week notice period required, in the event of termination of services. 58 46 LAKE RESOURCES ANNUAL REPORT 2023 Lake Resources NL Directors' report For the year ended 30 June 2023 Remuneration report (audited) (continued) SERVICE AGREEMENTS (continued) Executive KMP (continued) Service agreements for incumbent executive KMP (continued) Name Position Agreement commenced S. Crow Executive Chairman Terms of agreement Term:.Until terminated Additional Performance Shares: Mr. Neilsen was granted 680,705 Performance Shares as compensation for services rendered during the year. This grant was approved by shareholders at the general meeting of shareholders held 25 January 2022. Retention Award: Mr. Neilsen was also provided a one-off cash payment of A$200,000 in light of his contribution to reviewing and resetting the Kachi project plan. Termination: If termination notice is given by the Company, the Company shall be liable to pay full compensation for a three-month notice period. If notice is given by the executive, the notice period is three months. The Consolidated entity shall have the right to choose whether the executive works his notice period or is paid in lieu of notice. 2016 (ceased on 5 January 2023, upon transition to non-executive chair of the Board role) Nature of Services:.Chairman of the Lake Resources NL Board, in addition to external consultant for financing and marketing related services. Remuneration:.During his appointment as Executive Chairman for an estimated 6-month period (from 20 June 2022), Mr. Crow received director fees equivalent to AUD 1 million per annum. The revised remuneration was approved and later confirmed at a Board meeting on 9 August 2022. Table 15. Following his transition to non-executive chair of the Board on 20 December 2022, Mr. Crow was subject to the service agreements applicable to Non-Executive Directors and the remuneration payable is based on the fee structure for Non-Executive Directors outlined on Share-Based Remuneration:.Mr. Crow was granted 5,000,000 performance rights pursuant to approval at a shareholder meeting held on 15 August 2019, which are currently still held at the date of this report. Termination:.There is a 1 week notice period required, in the event of termination of services. Lake Resources NL Directors' report For the year ended 30 June 2023 Remuneration report (audited) (continued) SERVICE AGREEMENTS (continued) Executive KMP (continued) Service agreements for incumbent executive KMP (continued) Dr. N. Lindsay Name Executive Technical Director Position Agreement commenced Terms of agreement Term:.Until terminated 1 January 2021 (ceased as KMP on 28 November 2022) Base Salary:.Dr. Lindsay’s employment contract contains agreed compensation being a base salary of AUD 300,000 per annum in addition to statutory superannuation contributions Incentives:.Dr. Lindsay’s remuneration package entitles him to participate in the performance based short-term and long-term variable remuneration plans of the Company. STVR (Short-term variable remuneration):.Maximum entitlement to STVR will be approximately 20% of Base Pay and Benefits up to a maximum value of AUD 60,000 in the first year of the Term. The STVR package will comprise half cash and half in a grant of Performance Shares. LTVR (Long-term variable remuneration):.Maximum entitlement to LTVR will be approximately 40% of the annual value of Base Pay and Benefits as at the Commencement Date, comprised in Performance Shares granted in tranches over three years. The associated performance hurdles and weighting will be: (1) Tranche 1 (40%): measured no later than 15 months after the Commencement Date - the Company putting a project team in place to build the Project DFS and building the demonstration plant on site (2) Tranche 2 (40%): measured at the end of the second year after the Commencement Date - closing the debt and equity financing for the Company’s Kachi Project on terms satisfactory to the Company (3) Tranche 3 (20%): measured at the end of the third year after the Commencement Date - the Company receiving approval for the financing of an expansion case being up to 50,000 tonnes per annum lithium carbonate equivalent total plant production capacity at the Kachi project Termination:.If a termination notice is given by Consolidated entity, the Consolidated entity shall be liable to pay full compensation for a three-month notice period. If notice is given by the executive, the notice period is three months. Consolidated entity shall have the right to choose whether the executive works his notice period or be paid in lieu of notice. 46 47 5959 Lake Resources NL Directors' report For the year ended 30 June 2023 Remuneration report (audited) (continued) SERVICE AGREEMENTS (continued) Executive KMP (continued) Service agreements for incumbent executive KMP (continued) Name Position Agreement commenced Terms of agreement G. Parimoo Chief Operating Officer Term:.Until terminated 25 October 2021 (ceased on 9 January 2023) Base Salary:.USD 335,000 per year salary excluding superannuation. Sign-on bonus:.2 million options immediately exercisable with a strike price at zero premium to the Lake Resources share price on the day, with a 3-year expiry Incentives: Mr. Parimoo’s remuneration package entitles him to participate in the performance based short-term and long-term variable remuneration plans of the Consolidated entity. STVR (Short-term variable remuneration):.Maximum entitlement to STVR will be approximately 20% of Base Pay and Benefits up to a maximum value of USD 67,000 in the first year of the Term. The STVR package will comprise half cash and half in a grant of Performance Shares. LTVR (Long-term variable remuneration): Maximum entitlement to LTVR will be approximately 40% of the annual value of Base Pay and Benefits as at the Commencement Date, comprised in Performance Shares granted in tranches over three years. The associated performance hurdles and weighting will be: (1) Tranche 1 (40%):.measured no later than 15 months after the Commencement Date - the Company putting a project team in place to build the Project (2) Tranche 2 (20%):.measured at the end of the second year after the Commencement Date - closing the debt and equity financing for the Company’s Kachi Project on terms satisfactory to the Company (3) Tranche 3 (40%):.measured at the end of the third year after the Commencement Date - the successful commissioning of the project at 25,500 tonnes per annum lithium carbonate equivalent total production at the Kachi Project. Secondments: For any periods of secondments to Argentina, Mr. Parimoo is provided with relocation, repatriation, housing, medical and educational allowance for himself and his family, and a company vehicle. Business return airfares for himself and his family to Mr. Parimoos’ home base once a year are also provided by the Consolidated entity. Termination: If termination notice is given by the Consolidated entity, the Consolidated entity shall be liable to pay full compensation for a three-month notice period. If notice is given by the executive, the notice period is three months. The Consolidated entity shall have the right to choose whether the executive works his notice period or is paid in lieu of notice. 48 60 LAKE RESOURCES ANNUAL REPORT 2023 Lake Resources NL Directors' report For the year ended 30 June 2023 Remuneration report (audited) (continued) SERVICE AGREEMENTS (continued) Executive KMP (continued) Service agreements for incumbent executive KMP (continued) Name Position Agreement commenced G. Parimoo Chief Operating Officer 25 October 2021 (ceased on 9 January 2023) Terms of agreement Term:.Until terminated Base Salary:.USD 335,000 per year salary excluding superannuation. Sign-on bonus:.2 million options immediately exercisable with a strike price at zero premium to the Lake Resources share price on the day, with a 3-year expiry Incentives: Mr. Parimoo’s remuneration package entitles him to participate in the performance based short-term and long-term variable remuneration plans of the Consolidated entity. STVR (Short-term variable remuneration):.Maximum entitlement to STVR will be approximately 20% of Base Pay and Benefits up to a maximum value of USD 67,000 in the first year of the Term. The STVR package will comprise half cash and half in a grant of Performance Shares. LTVR (Long-term variable remuneration): Maximum entitlement to LTVR will be approximately 40% of the annual value of Base Pay and Benefits as at the Commencement Date, comprised in Performance Shares granted in tranches over three years. The associated performance hurdles and weighting will be: (1) Tranche 1 (40%):.measured no later than 15 months after the Commencement Date - the Company putting a project team in place to build the Project (2) Tranche 2 (20%):.measured at the end of the second year after the Commencement Date - closing the debt and equity financing for the Company’s Kachi Project on terms satisfactory to the Company (3) Tranche 3 (40%):.measured at the end of the third year after the Commencement Date - the successful commissioning of the project at 25,500 tonnes per annum lithium carbonate equivalent total production at the Kachi Project. Secondments: For any periods of secondments to Argentina, Mr. Parimoo is provided with relocation, repatriation, housing, medical and educational allowance for himself and his family, and a company vehicle. Business return airfares for himself and his family to Mr. Parimoos’ home base once a year are also provided by the Consolidated entity. Termination: If termination notice is given by the Consolidated entity, the Consolidated entity shall be liable to pay full compensation for a three-month notice period. If notice is given by the executive, the notice period is three months. The Consolidated entity shall have the right to choose whether the executive works his notice period or is paid in lieu of notice. 48 Lake Resources NL Directors' report For the year ended 30 June 2023 Remuneration report (audited) (continued) SHARE-BASED COMPENSATION Terms and Conditions of the Share-Based Payment Arrangements Options 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, prior or future reporting years are as follows: Grant date 12-July-2021 14-Oct-2021 15-Sep-2022 Vesting and exercise date 12-July-2021 25-Oct-2021 15-Sep-2023 Expiry date 12-July-2024 25-Oct-2024 15-Sep-2027 Exercise price $0.55 $0.57 $1.00 Value per option at grant date $0.231 $0.380 $1.095 % Vested % Expired/ Exercised 100% 100% 0% 0% 0% 0% 8,000,000 options over ordinary shares were issued to key management personnel the shareholder meetings. 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: following approval at Name P. Neilsen G. Parimoo D. Dickson Total Number of Options granted 2,000,000 2,000,000 4,000,000 8,000,000 Grant date 12-July-2021 14-Oct-2021 15-Sep-2022 Vesting and exercise date 12-July-2021 25-Oct-2021 15-Sep-2023 Expiry date 12-July-2024 25-Oct-2024 15-Sep-2027 Exercise price $0.55 $0.57 $1.00 Fair value at grant date $0.231 $0.380 $1.095 The options will be recognised over the four-year vesting period for all key management personnel. Of the 8,000,000 options on issue at the exercise date, none have been exercised or expired. Performance Rights The 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 date Expiry date 15-Aug-19 15-Aug-24 15-Aug-19 15-Aug-24 15-Aug-19 15-Aug-24 Value at Grant $0.0575 $0.0575 $0.0575 No. of Rights Granted 5,000,000 2,500,000 7,500,000 Performance Hurdle PFS Pilot plants Investor Performance achieved 100% 100% 100% No. vested and exercised 5,000,000 2,500,000 - No. of unvested performance rights - - Forfeited in prior year - - 5,000,000 2,500,000 Forfeited during the year - - - On 15 August 2019, 15,000,000 Performance rights were issued to Directors following approval at the shareholder meeting of 15 August 2019. 49 6161 Lake Resources NL Directors' report For the year ended 30 June 2023 Remuneration report (audited) (continued) SHARE-BASED COMPENSATION (continued) Terms and Conditions of the Share-Based Payment Arrangements (continued) Performance Rights (continued) Name S. Crow Number of Rights granted Grant date Expiry date 15-Aug-24 15-Aug-19 5,000,000 15-Aug-24 15-Aug-19 S. Promnitz 5,000,000 15-Aug-24 15-Aug-19 N. Lindsay 5,000,000 15,000,000 Total Fair value at grant date $0.0575 $0.0575 $0.0575 Vested and exercised in a prior year - 2,500,000 2,500,000 5,000,000 Forfeited in prior year - 2,500,000 - 2,500,000 Vested and exercised during the year - - 2,500,000 2,500,000 5,000,000 Unvested as at 30 June 2023 5,000,000 - - Performance rights outcomes are as follows: The Kachi Pre-Feasibility Study (PFS) completion resulted in 2.5 million for N. Lindsay and 2.5 million for S. Promnitz vested in the 2021 and converted into ordinary shares in 2022. Of the performance rights granted to Mr. Promnitz and Dr. Lindsay 5 million rights vested on 30 April 2020 and share were issued on 31 August 2020. Dr. Lindsay remaining 2.5 million rights vested on 2 November 2022, and shares were issued on 27 March 2023. As at 30 June 2023, Dr. Lindsay’s remaining 2.5 million performance rights are fully vested and have been converted into ordinary shares while Mr. Crow’s 5 million performance rights are yet to vest as the performance hurdle have not been met. Performance Shares Name Number of performance shares granted Grant date Expiry date Converted to Shares Expired Fair value at grant date (AUD) P. Neilsen N. Lindsay 123,809 22-Feb-2022 12-Dec-2022 139,285 22-Feb-2022 12-Mar-2023 167,142 22-Feb-2022 12-Sep-2023 250,714 22-Feb-2022 12-Sep-2024 92,343 22-Feb-2022 1-Jun-2022 147,749 22-Feb-2022 1-Jun-2022 147,749 22-Feb-2022 1-Mar-2023 73,874 22-Feb-2022 1-Mar-2024 Total 1,142,665 - - - - - - 147,749 - 147,749 123,809 139,285 - - 92,343 147,749 - 73,874 577,060 $0.9000 $0.9000 $0.9000 $0.9000 $0.9000 $0.9000 $0.9000 $0.9000 Total performance shares at 30 June 2023 (AUD) - - 167,142 250,714 - - - - 417,856 Expensed 2023 - - - - - - - (71,823) (71,823) 50 62 LAKE RESOURCES ANNUAL REPORT 2023 Lake Resources NL Directors' report For the year ended 30 June 2023 Remuneration report (audited) (continued) SHARE-BASED COMPENSATION (continued) Lake Resources NL Directors' report For the year ended 30 June 2023 Remuneration report (audited) (continued) SHARE-BASED COMPENSATION (continued) Terms and Conditions of the Share-Based Payment Arrangements (continued) Terms and Conditions of the Share-Based Payment Arrangements (continued) Performance Shares (continued) Directors exercised judgement in assessing the number of performance shares that are expected to vest. The vesting conditions and Directors assessment at 30 June 2023 are summarised below: Name Number of Performance shares granted Performance measure Measurement date Directors judgement at 30 June 2023 P. Neilsen 123,809 139,285 167,142 a and the debt operating financing for Delivering comprehensive financiers and reporting package for potential JV partners post close of the Kachi Project finance and closing of debt the Company’s Kachi Project (60%) comprehensive Delivering and financiers and reporting package for potential JV partners post close of the Kachi Project finance Maintain and deliver accurate reporting across all facets of the business incorporating cash flows, pre-production and budgeting. operating the debt a 12-Oct-22 This tranche expired during the year. 12-Jan-23 This tranche expired during the year. Preparation satisfaction syndicates and export credit agencies. financial financiers, documents project of of to the banking 12-Jul-23 the Directors In this milestone will not be met by 12 July 2023. Nil expense recorded. judgement, Implementation and maintenance of acceptable budgetary and cash flow measures across Australia and Argentina 250,714 Delivery of the Kachi Project into production with appropriate reporting mechanisms in place 12-Jul-24 92,343 147,749 147,749 N. Lindsay the Project DFS and Commencement of exploration and testing of brines from at least one of the Company’s other projects The Company putting a project build demonstration plant on site The Company closing the debt and equity financing the Company’s Kachi Project on terms for satisfactory to the Company team in place to the building judgement, the Directors In this milestone will not be met by 12 July 2024. Nil expense recorded. This tranche has vested. A$35,911 expense recognised in prior year. This tranche have vested. A$143,645 expense recognised in prior year. 1-Apr-22 1-Apr-22 1-Jan-23 This tranche has been converted to shares during the year. 73,874 The Company receiving approval for the financing of an expansion case being up to 50,000 tonnes per annum lithium carbonate equivalent total production at the Kachi Project 1-Jan-24 In the prior the Directors’ year, judgment was that financing approval is expected before 1 January 2024; it is therefore expected that all 73,874 Performance vest. will Shares A$71,823 expense recognised. As at 30 June 2023, prior expenses recognised has been reversed as a result of his exit from the company 51 6363 Performance Rights (continued) Name Number of Rights Fair value Vested and at grant exercised in Forfeited in during the as at 30 Vested and exercised Unvested granted Grant date Expiry date date a prior year prior year year S. Crow 5,000,000 S. Promnitz 5,000,000 N. Lindsay 5,000,000 15-Aug-19 15-Aug-19 15-Aug-19 15-Aug-24 15-Aug-24 15-Aug-24 $0.0575 $0.0575 $0.0575 - 2,500,000 2,500,000 2,500,000 - - - - 2,500,000 - - June 2023 5,000,000 Total 15,000,000 5,000,000 2,500,000 2,500,000 5,000,000 Performance rights outcomes are as follows: The Kachi Pre-Feasibility Study (PFS) completion resulted in 2.5 million for N. Lindsay and 2.5 million for S. Promnitz vested in the 2021 and converted into ordinary shares in 2022. Of the performance rights granted to Mr. Promnitz and Dr. Lindsay 5 million rights vested on 30 April 2020 and share were issued on 31 August 2020. Dr. Lindsay remaining 2.5 million rights vested on 2 November 2022, and shares were issued on 27 March 2023. As at 30 June 2023, Dr. Lindsay’s remaining 2.5 million performance rights are fully vested and have been converted into ordinary shares while Mr. Crow’s 5 million performance rights are yet to vest as the performance hurdle have not been met. Performance Shares Number of performance shares granted Name Grant date Expiry date Expired at grant shares at 30 Converted to Shares Fair value performance Total date (AUD) June 2023 (AUD) Expensed 2023 P. Neilsen 139,285 22-Feb-2022 12-Mar-2023 123,809 22-Feb-2022 12-Dec-2022 167,142 22-Feb-2022 12-Sep-2023 250,714 22-Feb-2022 12-Sep-2024 92,343 22-Feb-2022 1-Jun-2022 N. Lindsay 147,749 22-Feb-2022 1-Jun-2022 147,749 22-Feb-2022 1-Mar-2023 147,749 73,874 22-Feb-2022 1-Mar-2024 - - - - - - - 123,809 139,285 - - - 92,343 147,749 73,874 $0.9000 $0.9000 $0.9000 $0.9000 $0.9000 $0.9000 $0.9000 $0.9000 167,142 250,714 - - - - - - Total 1,142,665 147,749 577,060 417,856 - - - - - - - (71,823) (71,823) 50 Lake Resources NL Directors' report For the year ended 30 June 2023 Remuneration report (audited) (continued) SHARE-BASED COMPENSATION (continued) Terms and Conditions of the Share-Based Payment Arrangements (continued) Restricted Stock Unit The establishment of the Employee Award Scheme was approved by shareholders at the 2022 Annual General Meeting. The Employee Award Plan is designed to provide long-term incentives for senior managers and above (including executive directors) to deliver long-term shareholders returns. Under the plan, participants are eligible for restricted stock units which vest in 25% increments on each of the first four anniversaries of the commencement date. Restricted Stock Unit granted under the plan are for no consideration and carry no dividend or voting rights. The exercise price for the options shall be the fair value of Lakes Resources NL ordinary shares on the grant date. The terms and conditions of Restricted Stock Unit Terms and conditions of the share-based payment arrangements on issue as at 30 June 2023 affecting remuneration of directors and other key management personnel in this financial period or reporting period are as follows: Name Grant date Vesting date David Dickson 15-Sep-22 Cheemin Bo-Linn Howard Atkins Ana Gomez Chapman 1-Dec-22 2-Dec-22 1- Jan-23 15-Sep-23 15-Sep-24 15-Sep-25 15-Sep-26 1-Dec-23 2-Dec-23 1-Jan-24 Link between remuneration and performance Number of units allotted 250,000 250,000 250,000 250,000 232,500 232,500 238,500 Fair value price $0.930 $0.930 $0.930 $0.930 $1.005 $1.030 $0.800 Valuation 232,500 232,500 232,500 232,500 233,663 239,475 190,800 During 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 between 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. Additionally, while share price performance has decreased in 2023 year-on-year, the Company’s refreshed executive team is actively working towards achieving the goals set out in the updated strategy to commence production by 2027. As such, compensation has been set to ensure the Company can retain its key talent on its road to achieving its operational goals and enhance shareholder value. 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. 64 52 LAKE RESOURCES ANNUAL REPORT 2023 Lake Resources NL Directors' report For the year ended 30 June 2023 Remuneration report (audited) (continued) SHARE-BASED COMPENSATION (continued) Terms and Conditions of the Share-Based Payment Arrangements (continued) Restricted Stock Unit The establishment of the Employee Award Scheme was approved by shareholders at the 2022 Annual General Meeting. The Employee Award Plan is designed to provide long-term incentives for senior managers and above (including executive directors) to deliver long-term shareholders returns. Under the plan, participants are eligible for restricted stock units which vest in 25% increments on each of the first four anniversaries of the commencement date. Restricted Stock Unit granted under the plan are for no consideration and carry no dividend or voting rights. The exercise price for the options shall be the fair value of Lakes Resources NL ordinary shares on the grant date. The terms and conditions of Restricted Stock Unit Terms and conditions of the share-based payment arrangements on issue as at 30 June 2023 affecting remuneration of directors and other key management personnel in this financial period or reporting period are as follows: Name Grant date Vesting date Number of units Fair value David Dickson 15-Sep-22 Cheemin Bo-Linn Howard Atkins Ana Gomez Chapman 1-Dec-22 2-Dec-22 1- Jan-23 Link between remuneration and performance 15-Sep-23 15-Sep-24 15-Sep-25 15-Sep-26 1-Dec-23 2-Dec-23 1-Jan-24 allotted 250,000 250,000 250,000 250,000 232,500 232,500 238,500 price $0.930 $0.930 $0.930 $0.930 $1.005 $1.030 $0.800 Valuation 232,500 232,500 232,500 232,500 233,663 239,475 190,800 During 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 between 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. Additionally, while share price performance has decreased in 2023 year-on-year, the Company’s refreshed executive team is actively working towards achieving the goals set out in the updated strategy to commence production by 2027. As such, compensation has been set to ensure the Company can retain its key talent on its road to achieving its operational goals and enhance shareholder value. 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. Lake Resources NL Directors' report For the year ended 30 June 2023 Remuneration report (audited) (continued) Link between remuneration and performance (continued) The earnings of the Consolidated entity for the five years to 30 June 2023 and share price as at each year end are summarised below: Name Losses for the year attributable to owners of Lake Resources NL Net Assets Share Price at year end (cents) 2023 AUD 2022 AUD 2021 AUD 2020 AUD 2019 AUD 54,207,712 5,606,761 3,119,375 4,760,440 4,760,140 176,324,488 30.00 218,832,461 79.00 46,871,271 33.50 17,049,287 3.50 12,913,063 9.00 Additional Disclosures Relating to KMP 2023 Share Holdings Movements in the number of shares in the Consolidated entity held 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: Name S. Crow N. Lindsay P. Neilsen Total Balance at the start of the year 17,919,367 3,216,667 37,850 21,173,884 Received as part of remuneration - - - - Additions Disposal/Other - 2,500,000 - 2,500,000 (7,919,367) (5,716,667) - (13,636,034) Balance at the end of the year 10,000,000 - 37,850 10,037,850 Options Movements in the number of options over ordinary shares in the Consolidated entity held 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: Name D. Dickson P. Neilsen G. Parimoo Total Balance at the start of the year - 2,000,000 2,000,000 4,000,000 Granted as remuneration 4,000,000 - - 4,000,000 Exercised - - - - Listed options received - - - - Other - - (2,000,000) (2,000,000) Balance at the end of the year 4,000,000 2,000,000 - 6,000,000 52 53 6565 Lake Resources NL Directors' report For the year ended 30 June 2023 Remuneration report (audited) (continued) Additional Disclosures Relating to KMP (continued) Performance rights Movements in the number of performance rights over ordinary shares in the Consolidated entity held 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: Name S. Crow N. Lindsay Total Balance at start of the year 5,000,000 2,500,000 7,500,000 Granted as remuneration - - - Converted to shares Expired - (2,500,000) (2,500,000) - - - Balance at end of the year 5,000,000 - 5,000,000 Performance shares Movements in the number of performance shares over ordinary shares in the Consolidated entity held during the financial year by each director and other members of key management personnel of the Consolidated entity, including their personally related parties, terms and conditions of these issuance are set out in section (b) Service Agreements in each respective party, are set out below: Name P. Neilsen N. Lindsay Total Balance at start of the year 680,950 461,715 1,142,665 Granted as remuneration - - - Converted to shares - (147,749) (147,749) Expired (263,094) (313,966) (577,060) Balance at end of the year 417,856 - 417,856 Restricted Stock Units Movements in the number of restricted stock unit over ordinary shares in the Consolidated entity held during the financial year by each director and other members of key management personnel of the Consolidated entity, including their personally related parties, terms and conditions of these issuance are set out in section (b) Service Agreements in each respective party, are set out below: Name D. Dickson H. Atkins C. Bo-Linn A. Gomez Chapman Total Balance at start of the year - - - - - Granted as remuneration 1,000,000 232,500 232,500 238,500 1,703,500 Converted to shares - - - - Expired - - - - - Balance at end of the year 1,000,000 232,500 232,500 238,500 1,703,500 66 54 LAKE RESOURCES ANNUAL REPORT 2023 Lake Resources NL Directors' report For the year ended 30 June 2023 Remuneration report (audited) (continued) Additional Disclosures Relating to KMP (continued) Performance rights Movements in the number of performance rights over ordinary shares in the Consolidated entity held 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: Name S. Crow N. Lindsay Total Balance at start of Granted as the year remuneration 5,000,000 2,500,000 7,500,000 - - - Performance shares Converted to shares Expired (2,500,000) (2,500,000) Balance at end of the year 5,000,000 - 5,000,000 - - - Movements in the number of performance shares over ordinary shares in the Consolidated entity held during the financial year by each director and other members of key management personnel of the Consolidated entity, including their personally related parties, terms and conditions of these issuance are set out in section (b) Service Agreements in each respective party, are set out below: Name P. Neilsen N. Lindsay Total Balance at start of Granted as the year remuneration Converted to shares 680,950 461,715 1,142,665 - - - (147,749) (147,749) Expired (263,094) (313,966) (577,060) Balance at end of the year 417,856 - 417,856 Restricted Stock Units Movements in the number of restricted stock unit over ordinary shares in the Consolidated entity held during the financial year by each director and other members of key management personnel of the Consolidated entity, including their personally related parties, terms and conditions of these issuance are set out in section (b) Service Agreements in each respective party, are set out below: Balance at start of Granted as Converted to Balance at end the year remuneration shares Expired Name D. Dickson H. Atkins C. Bo-Linn A. Gomez Chapman Total - - - - - 1,000,000 232,500 232,500 238,500 1,703,500 of the year 1,000,000 232,500 232,500 238,500 1,703,500 - - - - - - - - - - - Lake Resources NL Directors' report For the year ended 30 June 2023 Remuneration report (audited) (continued) RELATED PARTY TRANSACTIONS The following transactions occurred with related parties: Payment for services Consultancy services provided by companies associated with Mr. Stuart Crow (Director) Consultancy services provided by a Consolidated entity associated with Mr. Nicholas Lindsay (Director) Consultancy services provided by former CFO Garry Gill (Executive) Consultancy services provided by an entity associated with Amalia Saenz (Director resigned 1 Feb 2023) Receivable from and (payable to) related parties Net advances to Mr Stephen Promnitz Disclosures relating to the advance to Mr Promnitz: 2023 $ 2022 $ - - - 142,312 142,312 96,600 186,593 108,260 - 391,453 200,000 1,077,773 • • • The outstanding balance at 30 June 2023 was $200,000 (2022: $1,077,773) The terms and conditions at 30 June 2023 of the advances are unsecured and has no personal guarantees. No provision for credit loss been recognised. End of Audited Remuneration Report 54 55 6767 Lake Resources NL Directors' report For the year ended 30 June 2023 Shares under option Unissued ordinary shares Unissued ordinary shares of Lake Resources NL under option at the date of this report are as follows: Grant Date 13-Jul-21 01-Aug-21 19-Jan-22 14-Oct-21 26-Apr-22 26-Apr-22 26-Aug-22 12-Sep-22 10-Oct-22 24-Oct-22 24-Oct-22 20-Jul-22 - 20-Jun-23 Total Expiry date 12-Jul-24 1-Aug-24 19-Jan-25 25-Oct-24 26-Apr-22 26-Apr-22 26-Aug-25 15-Jun-25 15-Sep-25 24-Oct-25 24-Oct-24 20-Jan-25 - 20-Jun-28 $0.55 $0.50 $1.48 $0.57 $1.42 $1.42 $1.50 $0.75 $1.13 $1.00 $1.00 $0.30 - $1.50 Exercise price Number under option 2,000,000 5,601,000 1,000,000 2,000,000 1,036,122 1,036,122 1,000,000 5,550,000 4,000,000 1,500,000 1,500,000 6,129,744 32,352,988 Each option is convertible to one ordinary share. Option holders do not have the right to participate in any other share issue of the Consolidated entity or 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 the exercise of options During or since the end of the financial year, the Consolidated entity issued ordinary shares of the Consolidated entity as a result of the exercise of options as follows (there are no amounts unpaid on the shares issued). Date options granted 16-Sep-19 09-Mar-21 09-Mar-21 27-Jan-21 24-Apr-21 28-Jul-21 28-Jul-21 28-Jul-21 28-Jul-21 01-Aug-21 30-Aug-21 24-Aug-21 15-Oct-21 19-Aug-19 Total Expiry date 31-Jul-21 09-Mar-23 09-Mar-23 09-Mar-23 24-May-23 31-Dec-24 31-Dec-24 31-Dec-24 31-Dec-24 01-Aug-24 15-Jun-22 15-Oct-22 15-Jun-22 15-Jun-21 Exercise price Number under option 14,000,000 55,874,040 11,351,803 1,000,000 1,500,000 10,000,000 10,000,000 10,000,000 5,000,000 179,000 4,000,000 86,094,394 82,895,145 75,000 291,969,382 $0.09 $0.30 $0.30 $0.30 $0.30 $0.55 $0.55 $0.55 $0.55 $0.50 $0.75 $0.35 $0.75 $0.10 68 56 LAKE RESOURCES ANNUAL REPORT 2023 Lake Resources NL Directors' report For the year ended 30 June 2023 Shares under option Unissued ordinary shares Unissued ordinary shares of Lake Resources NL under option at the date of this report are as follows: Exercise price Number under option 20-Jul-22 - 20-Jun-23 20-Jan-25 - 20-Jun-28 $0.30 - $1.50 Each option is convertible to one ordinary share. Option holders do not have the right to participate in any other share issue of the Consolidated entity or 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 the exercise of options During or since the end of the financial year, the Consolidated entity issued ordinary shares of the Consolidated entity as a result of the exercise of options as follows (there are no amounts unpaid on the shares issued). Date options granted Expiry date Exercise price Number under option Grant Date 13-Jul-21 01-Aug-21 19-Jan-22 14-Oct-21 26-Apr-22 26-Apr-22 26-Aug-22 12-Sep-22 10-Oct-22 24-Oct-22 24-Oct-22 Total 16-Sep-19 09-Mar-21 09-Mar-21 27-Jan-21 24-Apr-21 28-Jul-21 28-Jul-21 28-Jul-21 28-Jul-21 01-Aug-21 30-Aug-21 24-Aug-21 15-Oct-21 19-Aug-19 Total Expiry date 12-Jul-24 1-Aug-24 19-Jan-25 25-Oct-24 26-Apr-22 26-Apr-22 26-Aug-25 15-Jun-25 15-Sep-25 24-Oct-25 24-Oct-24 31-Jul-21 09-Mar-23 09-Mar-23 09-Mar-23 24-May-23 31-Dec-24 31-Dec-24 31-Dec-24 31-Dec-24 01-Aug-24 15-Jun-22 15-Oct-22 15-Jun-22 15-Jun-21 $0.55 $0.50 $1.48 $0.57 $1.42 $1.42 $1.50 $0.75 $1.13 $1.00 $1.00 $0.09 $0.30 $0.30 $0.30 $0.30 $0.55 $0.55 $0.55 $0.55 $0.50 $0.75 $0.35 $0.75 $0.10 2,000,000 5,601,000 1,000,000 2,000,000 1,036,122 1,036,122 1,000,000 5,550,000 4,000,000 1,500,000 1,500,000 6,129,744 32,352,988 14,000,000 55,874,040 11,351,803 1,000,000 1,500,000 10,000,000 10,000,000 10,000,000 5,000,000 179,000 4,000,000 86,094,394 82,895,145 75,000 291,969,382 56 Lake Resources NL Directors' report For the year ended 30 June 2023 Performance Rights At the date of this report there were 5,000,000 unissued ordinary shares of Lake Resources NL under performance rights. During the financial year ended 30 June 2023, no performance rights have expired in relation to Directors. No performance rights have been issued or converted to shares since 30 June 2023. Information on the issue of performance rights to Directors is provided in the remuneration report above or converted to shares. Performance Shares At the date of this report there were 417,856 unissued ordinary shares of Lake Resources NL under performance shares. During the financial year ended 30 June 2023, 577,060 performance shares have expired in relation to Directors. No performance shares have been issued since 30 June 2023. Information on the issue of performance shares to Directors is provided in the remuneration report above and 147,749 was converted to shares. Indemnity and insurance of officers The Consolidated entity has given an indemnity or entered into an agreement to indemnify directors and officers of the Consolidated entity against liabilities for costs and expenses incurred in defending legal proceedings arising from conduct while acting in the capacity as a director or officer of the Consolidated Entity, other than conduct involving a wilful breach. During the financial year, the Consolidated entity paid a premium in respect of a contract to insure the directors and officer of the Consolidated entity against 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 auditor The Consolidated entity has not, during or since the end of the financial year, indemnified or agreed to indemnify the auditor of the Consolidated entity or any related entity against a liability incurred by the auditor. During the financial year, the Consolidated entity has not paid a premium in respect of a contract to insure the auditor of the Consolidated entity or any related entity. Proceedings on behalf of the company No 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 entity is a party, for the purpose of taking responsibility on behalf of the Consolidated entity for all or part of those proceedings. Non-audit services BDO provided non-audit services of $112,670 during the financial year ended 30 June 2023. The Directors are satisfied that the provision of non-audit services is compatible with the general standard of independence for auditors imposed by the Corporations Act 2001. The Directors are satisfied that the provision of non-audit services did not compromise the auditor independence requirements of the Corporations Act 2001 because none of the services undermine the general principles relating to auditor independence as set out in APES 110 Code of Ethics for Professional Accountants. Officers of the Consolidated entity who are former partners of BDO Audit Pty Ltd There are no officers of the Consolidated entity who are former partners of BDO Audit Pty Ltd. 57 6969 Lake Resources NL Directors' report For the year ended 30 June 2023 Auditor's independence declaration A copy of the auditor's independence declaration as required under section 307C of the Corporations Act 2001 is set out on page 71. Auditor BDO Audit Pty Ltd continues in office in accordance with section 327 of the Corporations Act 2001. Rounding of amounts The company is of a kind referred to in ASIC Legislative Instrument 2016/191, relating to the 'rounding off' of amounts in the directors' report. Amounts in the directors' report have been rounded off in accordance with the instrument to the nearest dollar. This report is made in accordance with a resolution of Directors. S. Crow Non-Executive Chairman 28 September 2023 70 58 LAKE RESOURCES ANNUAL REPORT 2023 A copy of the auditor's independence declaration as required under section 307C of the Corporations Act 2001 is BDO Audit Pty Ltd continues in office in accordance with section 327 of the Corporations Act 2001. The company is of a kind referred to in ASIC Legislative Instrument 2016/191, relating to the 'rounding off' of amounts in the directors' report. Amounts in the directors' report have been rounded off in accordance with the instrument to This report is made in accordance with a resolution of Directors. Lake Resources NL Directors' report For the year ended 30 June 2023 Auditor's independence declaration set out on page 71. Auditor Rounding of amounts the nearest dollar. S. Crow Non-Executive Chairman 28 September 2023 Tel: +61 7 3237 5999 Fax: +61 7 3221 9227 www.bdo.com.au Level 10, 12 Creek Street Brisbane QLD 4000 GPO Box 457 Brisbane QLD 4001 Australia {The Auditor's Independence Declaration will be provided by your Auditor.} 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 2023, 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 in relation to the audit; and 2. 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 BDO Audit Pty Ltd Brisbane, 28 September 2023 58 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. 7171 Lake Resources NL Consolidated statement of profit or loss and other comprehensive income For the year ended 30 June 2023 Other Income Gain on Electronic Payment Market (MEP Dollar) Finance income Expenses Depreciation and amortisation expense Administrative expenses Corporate expenses Employee benefits expense Share based payments expense Consultancy and legal costs Foreign exchange gains and losses Impairment of assets Gain or loss on remeasurement of VAT receivable Finance income/(costs) - net Loss before income tax expense Income tax expense Loss after income tax expense for the year Other comprehensive (loss)/income for the year, net of tax Items that may be reclassified to profit or loss Foreign currency translation reserve Total comprehensive (loss)/income for the year Profit/(Loss) after income tax expense for the year attributable to: Owners of Lake Resources NL Non-controlling interests Total comprehensive (loss)/ income for the period is attributable to: Owners of Lake Resources NL Non-controlling interests Basic loss per share Diluted loss per share Note 2023 $ 2022 $ 5 43,696,631 2,890,335 9,356,830 34,804 5 5 5 5 5 4 11, 8 8(b) 5 6 (207,433) (2,973,268) (9,445,706) (13,977,944) (13,018,995) (15,404,527) (25,577,700) (1,929,446) (10,661,443) (196,908) (46,806,404) (446,639) (47,253,043) (51,298) (726,516) (3,558,882) (1,835,588) (2,425,591) (3,374,051) (2,404,457) - - (9,678) (4,994,427) (688,666) (5,683,093) 16 (10,343,798) (57,596,841) 76,334 (5,606,759) 26 (45,754,115) (1,498,928) (47,253,043) (5,683,093) - (5,683,093) (54,207,712) (3,389,129) (57,596,841) (5,606,761) - (5,606,761) Cents Cents 17 17 (3.26) (3.26) (0.51) (0.51) The above consolidated statement of profit or loss and other comprehensive income should be read in conjunction with the accompanying notes. 60 72 LAKE RESOURCES ANNUAL REPORT 2023 Gain on Electronic Payment Market (MEP Dollar) Other Income Finance income Expenses Depreciation and amortisation expense Administrative expenses Corporate expenses Employee benefits expense Share based payments expense Consultancy and legal costs Foreign exchange gains and losses Impairment of assets Gain or loss on remeasurement of VAT receivable Finance income/(costs) - net Loss before income tax expense Income tax expense Loss after income tax expense for the year Other comprehensive (loss)/income for the year, net of tax Items that may be reclassified to profit or loss Foreign currency translation reserve Total comprehensive (loss)/income for the year Profit/(Loss) after income tax expense for the year attributable to: Owners of Lake Resources NL Non-controlling interests Total comprehensive (loss)/ income for the period is attributable to: Owners of Lake Resources NL Non-controlling interests Basic loss per share Diluted loss per share Note 2023 $ 2022 $ 5 5 5 5 5 5 4 5 6 11, 8 8(b) 43,696,631 2,890,335 9,356,830 34,804 (207,433) (2,973,268) (9,445,706) (13,977,944) (13,018,995) (15,404,527) (25,577,700) (1,929,446) (10,661,443) (196,908) (46,806,404) (446,639) (47,253,043) (51,298) (726,516) (3,558,882) (1,835,588) (2,425,591) (3,374,051) (2,404,457) (9,678) (4,994,427) (688,666) (5,683,093) 16 (10,343,798) (57,596,841) 76,334 (5,606,759) (45,754,115) (5,683,093) 26 (1,498,928) (47,253,043) (5,683,093) (54,207,712) (3,389,129) (57,596,841) (5,606,761) (5,606,761) Cents Cents 17 17 (3.26) (3.26) (0.51) (0.51) - - - - 60 Lake Resources NL Consolidated statement of profit or loss and other comprehensive income For the year ended 30 June 2023 Lake Resources NL Consolidated statement of Financial Position As at 30 June 2023 Assets Current assets Cash and cash equivalents Trade and other receivables Other current assets Total current assets Non-current assets Property, plant and equipment Right-of-use assets Other financial assets Exploration and evaluation Total non-current assets Total assets Liabilities Current liabilities Trade and other payables Lease liabilities Employee benefits Total current liabilities Non-current liabilities Lease liabilities Employee benefits Total non-current liabilities Total liabilities Net assets Equity Issued capital Reserves Accumulated losses Total equity attributable to owners of the parent Non-controlling interests Total equity Note 7 8 9 12 11 8(b) 10 13 11 14 11 14 30 June 2023 $ 30 June 2022 $ 89,217,466 1,935,223 1,420,335 92,573,024 175,444,065 5,734,693 286,267 181,465,025 1,541,620 80,806 1,046,001 98,175,863 100,844,290 193,417,314 640,623 229,692 - 41,549,942 42,420,257 223,885,282 11,247,825 348,354 4,170,663 15,766,842 4,515,147 80,235 255,608 4,850,990 1,324,490 1,494 1,325,984 17,092,826 197,622 4,208 201,830 5,052,820 176,324,488 218,832,462 15(a) 16(f) 229,703,796 6,513,767 (64,968,080) 171,249,483 5,075,005 176,324,488 231,179,318 9,508,419 (21,855,275) 218,832,462 - 218,832,462 The above consolidated statement of profit or loss and other comprehensive income should be read in conjunction with the accompanying notes. The above Consolidated statement of Financial Position should be read in conjunction with the accompanying notes. 7373 Lake Resources NL Consolidated statement of changes in equity For the year ended 30 June 2023 Attributable to owners of Lake Resources NL Note Issued capital $ Reserves $ Accumulated Losses $ Total equity attributable to owners of the parent $ Non- controlling interests $ Balance at 1 July 2021 65,748,642 3,364,591 (22,241,962) 46,871,271 Loss for the year Other comprehensive income Total comprehensive income for the year Transactions with owners in their capacity as owners: Contributions of equity, net of transaction costs Share issue costs Issue of unlisted options to brokers Issue of unlisted options to brokers Transfer from option reserve to accumulated losses on options expired/exercised Issue of performance rights Balance at 30 June 2022 - - - - (5,683,093) (5,683,093) 76,334 - 76,334 76,334 (5,683,093) (5,606,759) 15(a) 15(a) 175,575,639 (10,144,963) 15 - - - - - 1,800,461 9,711,684 - - - - 175,575,639 (10,144,963) 1,800,461 9,711,684 (6,069,780) 6,069,780 - - 165,430,676 625,129 6,067,494 - 6,069,780 625,129 177,567,950 231,179,318 9,508,419 (21,855,275) 218,832,462 - - - - - - - - - - - - Total equity $ 46,871,271 (5,683,093) 76,334 (5,606,759) 175,575,639 (10,144,963) 1,800,461 9,711,684 - 625,129 177,567,950 218,832,462 The above consolidated statement of changes in equity should be read in conjunction with the accompanying notes. 62 74 LAKE RESOURCES ANNUAL REPORT 2023 Lake Resources NL Consolidated statement of changes in equity For the year ended 30 June 2023 Lake Resources NL Consolidated statement of changes in equity For the year ended 30 June 2023 Attributable to owners of Lake Resources NL Total equity attributable Non- Accumulated to owners of controlling Issued capital Reserves Losses the parent interests Note $ $ $ $ $ Attributable to owners of Lake Resources NL Note Issued capital $ Reserves $ Total equity attributable to owners of the parent $ Non- controlling interests $ Accumulated Losses $ Total equity $ Balance at 1 July 2021 65,748,642 3,364,591 (22,241,962) 46,871,271 46,871,271 Balance at 1 July 2022 231,179,318 9,508,419 (21,855,276) 218,832,461 - 218,832,461 - (5,683,093) (5,683,093) 76,334 76,334 76,334 (5,683,093) (5,606,759) 15(a) 15(a) 175,575,639 (10,144,963) 15 - - 1,800,461 9,711,684 175,575,639 (10,144,963) 1,800,461 9,711,684 (6,069,780) 6,069,780 - 165,430,676 625,129 6,067,494 6,069,780 177,567,950 625,129 - - - - - - - - - - - - - Loss for the year Other comprehensive income Total comprehensive income for the year Transactions with owners in their capacity as owners: Contributions of equity, net of transaction costs Share issue costs Issue of unlisted options Issue of unlisted options to brokers to brokers Transfer from option reserve to accumulated losses on options expired/exercised Issue of performance rights Balance at 30 June 2022 231,179,318 9,508,419 (21,855,275) 218,832,462 218,832,462 Loss for the year Other comprehensive income Total comprehensive income for the year Transactions with owners in their capacity as owners: Contributed equity Share issue costs Issue of unlisted options to brokers and KMPs and other employees Unwinding of performance rights to Directors Issue of unlisted options to brokers Transfer from option reserve to accumulated losses on options expired/exercised Change in interest in controlled entity Issue of restricted stock units to employees 19 19 19(b) 26 20 - - - - (45,754,115) (45,754,115) (1,498,928) (47,253,043) (8,453,597) - (8,453,597) (1,890,201) (10,343,798) (8,453,597) (45,754,115) (54,207,712) (3,389,129) (57,596,841) 15(a) 15(a) 2,348,232 (3,823,754) - - - - 2,348,232 (3,823,754) 11,959,835 - 11,959,835 (57,467) 3,489,695 - - (57,467) 3,489,695 (2,641,311) 2,641,311 - - - - - - (8,464,134) - (8,464,134) 8,464,134 - (1,475,522) 1,172,327 5,458,945 - 2,641,311 1,172,327 6,624,734 - 8,464,134 1,172,327 15,088,868 - - - - - - 2,348,232 (3,823,754) 11,959,835 (57,467) 3,489,695 - - Balance at 30 June 2023 229,703,796 6,513,767 (64,968,080) 171,249,483 5,075,005 176,324,488 The above consolidated statement of changes in equity should be read in conjunction with the accompanying notes. The above consolidated statement of changes in equity should be read in conjunction with the accompanying notes. 7575 Total equity $ (5,683,093) 76,334 (5,606,759) 175,575,639 (10,144,963) 1,800,461 9,711,684 - 625,129 177,567,950 - - - - - - - - - - - - 62 Lake Resources NL Consolidated statement of cash flows For the year ended 30 June 2023 Cash flows from operating activities Payments to suppliers (Inclusive of GST) Interest received Interest paid Income taxes paid Net cash (outflow) from operating activities Cash flows from investing activities Payments for property, plant and equipment Payments for exploration and evaluation Net or gross receipt from Electronic Payment Market (MEP) transactions Net cash (outflow) from investing activities Cash flows from financing activities Proceeds from issue of shares, net of transaction costs Principal payments of lease liabilities Net cash inflow from financing activities Net (decrease) increase in cash and cash equivalents Cash and cash equivalents at the beginning of the financial year Effects of exchange rate changes on cash and cash equivalents Cash and cash equivalents at end of year Note 2023 $ 2022 $ (29,981,156) 2,890,335 (196,908) (446,639) (27,734,368) (8,841,357) - (8,090) (688,666) (9,538,113) (1,236,656) (66,522,685) 43,696,631 (24,062,710) (615,061) (23,596,548) 9,363,016 (14,848,593) 29 10 15(a) 2,014,175 (244,767) 1,769,408 174,193,136 (19,440) 174,173,696 (50,027,670) 175,444,065 (36,198,929) 89,217,466 149,786,990 25,657,074 - 175,444,064 7 The above consolidated statement of cash flows should be read in conjunction with the accompanying notes. 64 76 LAKE RESOURCES ANNUAL REPORT 2023 Lake Resources NL Consolidated statement of cash flows For the year ended 30 June 2023 Cash flows from operating activities Payments to suppliers (Inclusive of GST) Interest received Interest paid Income taxes paid Net cash (outflow) from operating activities Cash flows from investing activities Payments for property, plant and equipment Payments for exploration and evaluation Net or gross receipt from Electronic Payment Market (MEP) transactions Net cash (outflow) from investing activities Cash flows from financing activities Proceeds from issue of shares, net of transaction costs Principal payments of lease liabilities Net cash inflow from financing activities Net (decrease) increase in cash and cash equivalents Cash and cash equivalents at the beginning of the financial year Effects of exchange rate changes on cash and cash equivalents Cash and cash equivalents at end of year (29,981,156) (8,841,357) 2,890,335 (196,908) (446,639) - (8,090) (688,666) 29 (27,734,368) (9,538,113) 10 (1,236,656) (66,522,685) 43,696,631 (615,061) (23,596,548) 9,363,016 (24,062,710) (14,848,593) 15(a) 2,014,175 (244,767) 1,769,408 174,193,136 (19,440) 174,173,696 (50,027,670) 149,786,990 175,444,065 (36,198,929) 25,657,074 - 7 89,217,466 175,444,064 Note 2023 $ 2022 $ 1 Significant accounting policies Lake Resources NL Note to the consolidated financial statements 30 June 2023 The principal accounting policies adopted in the preparation of the financial statements are set out below. These policies have been consistently applied to all the years presented, unless otherwise stated. (a) Basis of preparation These general purpose consolidated financial statements have been prepared in accordance with Australian Accounting Standards and Interpretations issued by the Australian Accounting Standards Board and the Corporations Act 2001. Lake Resources NL is a for-profit entity for the purpose of preparing the consolidated financial statements. (i) Compliance with IFRS The consolidated financial statements of the Lake Resources NL and its subsidiaries (Consolidated entity) also comply with International Financial Reporting Standards (IFRS) as issued by the International Accounting Standards Board (IASB). (ii) Historical cost convention The consolidated financial statements have been prepared under the historical cost convention. (iii) New standards and interpretations not yet adopted Certain new accounting amendments to accounting standards and interpretations have been published that are not mandatory for 30 June 2023 reporting years and have not been early adopted by the Consolidated entity. The Consolidated entity’s assessment of the impact of these new standards and interpretations is set out below. These standards, amendments or interpretations are not expected to have a material impact on the Consolidated entity in the current or future reporting years and on foreseeable future transactions. (iv) Critical accounting estimates The preparation of consolidated financial statements requires the use of certain critical accounting estimates. It also requires management to exercise its judgement in the process of applying the Consolidated entity's accounting policies. The areas involving a higher degree of judgement or complexity, or areas where assumptions and estimates are significant to the consolidated financial statements, are disclosed in note 2. (b) New or amended Accounting Standards and Interpretations adopted The Consolidated entity has adopted all of the new or amended Accounting Standards and Interpretations issued by the Australian Accounting Standards Board ('AASB') that are mandatory for the current reporting period. Any new or amended Accounting Standards or Interpretations that are not yet mandatory have not been early adopted. The adoption of these Accounting Standards and Interpretations did not have any significant impact on the financial performance or position of the Consolidated entity. (c) Going concern The 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 entity has incurred net losses after tax of $47,253,043 (30 June 2022: loss $5,683,095) and net cash outflows from operating and investing activities of $51,797,078 for the year ended 30 June 2023. At 30 June 2023, the Company had net current assets of $76,806,182. The above consolidated statement of cash flows should be read in conjunction with the accompanying notes. 64 65 7777 Lake Resources NL Note to the consolidated financial statements 30 June 2023 1 Significant accounting policies (continued) (c) Going concern (continued) Based upon the Consolidated entity’s existing cash resources, the Directors consider there are reasonable grounds to believe that the Consolidated entity will be able to continue as a going concern after consideration of the following factors: • • • The Consolidated entity has cash reserves of $89,217,466 at 30 June 2023; The Consolidated entity has no loans or borrowings; and The Consolidated entity has the ability to adjust its expenditure outlays subject to results of its exploration activities and the Consolidated entity’s funding position The Directors believe that the above indicators demonstrate that the Consolidated entity will be able to pay its debts as and when they fall due and continue as a going concern. Therefore, the Directors believe it is appropriate to adopt the going concern basis for the preparation of the Consolidated entity’s 2023 annual financial report. The Directors expect that while current funds would be sufficient to meet a minimum program of exploration and development, an expanded program would require additional funds. The Consolidated entity has previously raised funds through share placements and capital raisings from new and existing shareholders. Lake has At-the-market subscription Agreement (ATM) (also referred to as Controlled Placement Agreement) with Acuity Capital. This agreement was extended from 31 January 2023 to 31 January 2026, this provides another additional source of raising cash and can be utilized by the Group at any point. (d) Parent entity information In accordance with the Corporations Act 2001, these financial statements present the results of the Consolidated entity only. Supplementary information about the parent entity is disclosed in note 25. (e) Principles of consolidation The consolidated financial statements incorporate all of the parent (Lake Resources NL) and all of the subsidiaries. Subsidiaries are entities the parent controls. The parent controls an entity when it is exposed to, or has rights to, variable returns from its involvement with the entity and has the ability to affect those returns through its power over the entity. A list of subsidiaries is provided in note 27. liabilities and results of the assets, The assets, liabilities and results of all subsidiaries are fully consolidated into the financial statements of the Consolidated entity from the date on which control is obtained by the Consolidated entity. The consolidation of a subsidiary is discontinued from the date that control ceases. Intercompany transactions, balances and unrealised gains or losses on transactions between consolidated entities are fully eliminated on consolidation. Accounting policies of subsidiaries have been changed and adjustments made where necessary to ensure uniformity of the accounting policies adopted by the Consolidated entity. (i) Subsidiaries Subsidiaries are all entities (including structured entities) over which the Consolidated entity has control. The Consolidated entity controls an entity where the Consolidated entity is exposed to, or has rights to, variable returns from its involvement with the entity and has the ability to affect those returns through its power to direct the activities of the entity. Subsidiaries are fully consolidated from the date on which control is transferred to the Consolidated entity. They are deconsolidated from the date that control ceases. 78 66 LAKE RESOURCES ANNUAL REPORT 2023 Lake Resources NL 30 June 2023 Note to the consolidated financial statements 1 Significant accounting policies (continued) (c) Going concern (continued) Based upon the Consolidated entity’s existing cash resources, the Directors consider there are reasonable grounds to believe that the Consolidated entity will be able to continue as a going concern after consideration of the following factors: • • • The Consolidated entity has cash reserves of $89,217,466 at 30 June 2023; The Consolidated entity has no loans or borrowings; and The Consolidated entity has the ability to adjust its expenditure outlays subject to results of its exploration activities and the Consolidated entity’s funding position The Directors believe that the above indicators demonstrate that the Consolidated entity will be able to pay its debts as and when they fall due and continue as a going concern. Therefore, the Directors believe it is appropriate to adopt the going concern basis for the preparation of the Consolidated entity’s 2023 annual financial report. The Directors expect that while current funds would be sufficient to meet a minimum program of exploration and development, an expanded program would require additional funds. The Consolidated entity has previously raised funds through share placements and capital raisings from new and existing shareholders. Lake has At-the-market subscription Agreement (ATM) (also referred to as Controlled Placement Agreement) with Acuity Capital. This agreement was extended from 31 January 2023 to 31 January 2026, this provides another additional source of raising cash and can be utilized by the Group at any point. (d) Parent entity information In accordance with the Corporations Act 2001, these financial statements present the results of the Consolidated entity only. Supplementary information about the parent entity is disclosed in note 25. (e) Principles of consolidation The consolidated financial statements incorporate all of the assets, liabilities and results of the parent (Lake Resources NL) and all of the subsidiaries. Subsidiaries are entities the parent controls. The parent controls an entity when it is exposed to, or has rights to, variable returns from its involvement with the entity and has the ability to affect those returns through its power over the entity. A list of subsidiaries is provided in note 27. The assets, liabilities and results of all subsidiaries are fully consolidated into the financial statements of the Consolidated entity from the date on which control is obtained by the Consolidated entity. The consolidation of a subsidiary is discontinued from the date that control ceases. Intercompany transactions, balances and unrealised gains or losses on transactions between consolidated entities are fully eliminated on consolidation. Accounting policies of subsidiaries have been changed and adjustments made where necessary to ensure uniformity of the accounting policies adopted by the Consolidated entity. (i) Subsidiaries Subsidiaries are all entities (including structured entities) over which the Consolidated entity has control. The Consolidated entity controls an entity where the Consolidated entity is exposed to, or has rights to, variable returns from its involvement with the entity and has the ability to affect those returns through its power to direct the activities of the entity. Subsidiaries are fully consolidated from the date on which control is transferred to the Consolidated entity. They are deconsolidated from the date that control ceases. 66 Lake Resources NL Note to the consolidated financial statements 30 June 2023 1 Significant accounting policies (continued) (e) Principles of consolidation (continued) (i) Subsidiaries (continued) Intercompany transactions, balances and unrealised gains on transactions between Group companies are eliminated. Unrealised losses are also eliminated unless the transaction provides evidence of an impairment of the transferred asset. Accounting policies of subsidiaries have been changed where necessary to ensure consistency with the policies adopted by the Consolidated entity. Non-controlling interests in the results and equity of subsidiaries are shown separately in the consolidated statement of profit or loss and other comprehensive income, statement of comprehensive income, statement of changes in equity and statement of financial position respectively. (ii) Changes in ownership interests The Consolidated entity treats transactions with non-controlling interests that do not result in a loss of control as transactions with equity owners of the Consolidated entity. A change in ownership interest results in an adjustment between the carrying amounts of the controlling and non-controlling interests to reflect their relative interests in the subsidiary. Any difference between the amount of the adjustment to non-controlling interests and any consideration paid or received is recognised in a separate reserve within equity attributable to owners of Lake Resources NL. (f) Operating segment Operating segments are presented using the 'management approach', where the information presented is on the same basis as the internal reports provided to the Chief Operating Decision Makers ('CODM'). The CODM is responsible for the allocation of resources to operating segments and assessing their performance. (g) Foreign currency translation (i) Functional and presentation currency The consolidated financial statements are presented in Australian dollars. The functional currency of each of the entities in the Consolidated entity is 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). (ii) Transactions and balances Foreign 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 loss and 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 loss is directly recognised in equity, otherwise the exchange difference is recognised in the statement of profit or loss and other comprehensive income. 67 7979 Lake Resources NL Note to the consolidated financial statements 30 June 2023 1 Significant accounting policies (continued) (g) Foreign currency translation (continued) (iii) Foreign operations The functional currency of the Consolidated entity’s foreign operations in Argentina is US 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. The 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. (h) MEP contract settlement – Argentina cash calls: USD conversion to ARS (i) Overview USD cash calls are transferred from Lake Resources NL bank account (Australia) to Argentina subsidiary company bank accounts, to cover working capital in relation to the Kachi project costs. USD is subsequently converted, by the subsidiary companies, in a hyperinflationary economy, the USD is regularly converted to ARS via a MEP Dollar trading mechanism with a local bank/broker in Argentina. to ARS (Argentinian peso). To maximise the value of local purchasing power (ii) Accounting treatment for MEP contract settlements FX gains/losses on settlement: Settled FX contract bonds to sell USD and buy ARS are recorded initially in subsidiary ledger (ARS base currency) and then restated to AUD at month end for presentation/reporting purposes. The MEP (* Electronic Payment Market) are financial instruments in line with AASB 9 (the sale of the bonds) characterized as gain/loss on the sale of the bond. The gain or loss associated with the trading of these financial instruments are treated as other income or other expenses in the Consolidated statement of profit or loss and other comprehensive income. (i) Financial instruments Investments and other financial assets are initially measured at fair value. Transaction costs are included as part of the initial measurement, except for financial assets at fair value through profit or loss. Such assets are subsequently measured at either amortised cost or fair value depending on their classification. Classification is determined based on both the business model within which such assets are held and the contractual cash flow characteristics of the financial asset unless, an accounting mismatch is being avoided. (i) Financial assets at amortised cost Financial 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. (ii) Financial assets at fair value through profit or loss Financial 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. 68 80 LAKE RESOURCES ANNUAL REPORT 2023 Lake Resources NL 30 June 2023 Note to the consolidated financial statements 1 Significant accounting policies (continued) (g) Foreign currency translation (continued) (iii) Foreign operations The functional currency of the Consolidated entity’s foreign operations in Argentina is US 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. The 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. (h) MEP contract settlement – Argentina cash calls: USD conversion to ARS (i) Overview USD cash calls are transferred from Lake Resources NL bank account (Australia) to Argentina subsidiary company bank accounts, to cover working capital in relation to the Kachi project costs. USD is subsequently converted, by the subsidiary companies, to ARS (Argentinian peso). To maximise the value of local purchasing power in a hyperinflationary economy, the USD is regularly converted to ARS via a MEP Dollar trading mechanism with a local bank/broker in Argentina. (ii) Accounting treatment for MEP contract settlements FX gains/losses on settlement: Settled FX contract bonds to sell USD and buy ARS are recorded initially in subsidiary ledger (ARS base currency) and then restated to AUD at month end for presentation/reporting purposes. The MEP (* Electronic Payment Market) are financial instruments in line with AASB 9 (the sale of the bonds) characterized as gain/loss on the sale of the bond. The gain or loss associated with the trading of these financial instruments are treated as other income or other expenses in the Consolidated statement of profit or loss and other comprehensive income. (i) Financial instruments Investments and other financial assets are initially measured at fair value. Transaction costs are included as part of the initial measurement, except for financial assets at fair value through profit or loss. Such assets are subsequently measured at either amortised cost or fair value depending on their classification. Classification is determined based on both the business model within which such assets are held and the contractual cash flow characteristics of the financial asset unless, an accounting mismatch is being avoided. (i) Financial assets at amortised cost Financial 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. (ii) Financial assets at fair value through profit or loss Financial 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. 68 Lake Resources NL Note to the consolidated financial statements 30 June 2023 1 Significant accounting policies (continued) (i) Financial instruments (continued) (iii) Financial assets at fair value through comprehensive income Financial assets at fair value through other comprehensive income include equity investments which the Consolidated entity intends to hold for the foreseeable future and has irrevocably elected to classify them as such upon initial recognition. (iv) Impairment of financial assets The 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 instrument's credit risk has increased significantly since initial recognition, based on reasonable and financial 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. Income tax (j) The income tax expense or credit for the year is the tax payable on the current year's taxable income based on the applicable income tax rate for each jurisdiction adjusted by changes in deferred tax assets and liabilities attributable to temporary differences and to unused tax losses. The current income tax charge is calculated on the basis of the tax laws enacted or substantively enacted at the end of the reporting year in the countries where the company and its subsidiaries operate and associates operate and generate taxable income. Management periodically evaluates positions taken in tax returns with respect to situations in which applicable tax regulation is subject to interpretation and considers whether it is probable that a taxation authority will accept an uncertain tax treatment. The Consolidated entity measures its tax balances either based on the most likely amount or the expected value, depending on which method provides a better prediction of the resolution of the uncertainty. Deferred income tax is provided in full, using the liability method, on temporary differences arising between the tax bases of assets and liabilities and their carrying amounts in the consolidated financial statements. However, deferred tax liabilities are not recognised if they arise from the initial recognition of goodwill. Deferred income tax is also not accounted for if it arises from initial recognition of an asset or liability in a transaction other than a business combination that at the time of the transaction affects neither accounting nor taxable profit or loss and does not give rise to equal taxable and deductible temporary differences. Deferred income tax is determined using tax rates (and laws) that have been enacted or substantively enacted by the end of the reporting year and are expected to apply when the related deferred income tax asset is realised or the deferred income tax liability is settled. The deferred tax liability in relation to investment property that is measured at fair value is determined assuming the property will be recovered entirely through sale. 69 8181 Lake Resources NL Note to the consolidated financial statements 30 June 2023 1 Significant accounting policies (continued) Income tax (continued) (j) Deferred tax assets are recognised only if it is probable that future taxable amounts will be available to utilise those temporary differences and losses. Deferred tax liabilities and assets are not recognised for temporary differences between the carrying amount and tax bases of investments in foreign operations where the company is able to control the timing of the reversal of the temporary differences and it is probable that the differences will not reverse in the foreseeable future. Deferred tax assets and liabilities are offset where there is a legally enforceable right to offset current tax assets and liabilities and where the deferred tax balances relate to the same taxation authority. Current tax assets and tax liabilities are offset where the entity has a legally enforceable right to offset and intends either to settle on a net basis, or to realise the asset and settle the liability simultaneously. (k) Current and non-current classification Assets and liabilities are presented in the statement of classification. financial position based on current and non-current An asset is classified as current when: it is either expected to be realised or intended to be sold or consumed in the Consolidated entity's normal operating cycle; it is held primarily for the purpose of trading; it is expected to be realised within 12 months after the reporting period; or the asset is cash or cash equivalent unless restricted from being exchanged or used to settle a liability for at least 12 months after the reporting period. All other assets are classified as non-current. A liability is classified as current when: it is either expected to be settled in the Consolidated entity's normal operating cycle; it is held primarily for the purpose of trading; it is due to be settled within 12 months after the reporting period; or there is no unconditional right to defer the settlement of the liability for at least 12 months after the reporting period. All other liabilities are classified as non-current. Deferred tax assets and liabilities are always classified as non-current. (l) Leases Assets and liabilities arising from a lease are initially measured on a present value basis. Lease liabilities include the net present value of the following lease payments: Lease payments to be made under reasonably certain extension options are also included in the measurement of the liability. Lease payments are allocated between principal and finance cost. The finance cost is charged to profit or loss over the lease period so as to produce a constant periodic rate of interest on the remaining balance of the liability for each period. Right-of-use assets are measured at cost comprising the following: • • • • the amount of the initial measurement of lease liability; any lease payments made at or before the commencement date less any lease incentives received; any initial direct costs; and restoration costs. Entity-specific details about the Group’s leasing policy are provided in note 11. 70 82 LAKE RESOURCES ANNUAL REPORT 2023 Lake Resources NL 30 June 2023 Note to the consolidated financial statements Lake Resources NL Note to the consolidated financial statements 30 June 2023 1 Significant accounting policies (continued) 1 Significant accounting policies (continued) Deferred tax assets are recognised only if it is probable that future taxable amounts will be available to utilise those (j) Income tax (continued) temporary differences and losses. Deferred tax liabilities and assets are not recognised for temporary differences between the carrying amount and tax bases of investments in foreign operations where the company is able to control the timing of the reversal of the temporary differences and it is probable that the differences will not reverse in the foreseeable future. Deferred tax assets and liabilities are offset where there is a legally enforceable right to offset current tax assets and liabilities and where the deferred tax balances relate to the same taxation authority. Current tax assets and tax liabilities are offset where the entity has a legally enforceable right to offset and intends either to settle on a net basis, or to realise the asset and settle the liability simultaneously. (k) Current and non-current classification Assets and liabilities are presented in the statement of financial position based on current and non-current classification. as non-current. An asset is classified as current when: it is either expected to be realised or intended to be sold or consumed in the Consolidated entity's normal operating cycle; it is held primarily for the purpose of trading; it is expected to be realised within 12 months after the reporting period; or the asset is cash or cash equivalent unless restricted from being exchanged or used to settle a liability for at least 12 months after the reporting period. All other assets are classified A liability is classified as current when: it is either expected to be settled in the Consolidated entity's normal operating cycle; it is held primarily for the purpose of trading; it is due to be settled within 12 months after the reporting period; or there is no unconditional right to defer the settlement of the liability for at least 12 months after the reporting period. All other liabilities are classified as non-current. Deferred tax assets and liabilities are always classified as non-current. (l) Leases Assets and liabilities arising from a lease are initially measured on a present value basis. Lease liabilities include the net present value of the following lease payments: Lease payments to be made under reasonably certain extension options are also included in the measurement of the Lease payments are allocated between principal and finance cost. The finance cost is charged to profit or loss over the lease period so as to produce a constant periodic rate of interest on the remaining balance of the liability for each Right-of-use assets are measured at cost comprising the following: the amount of the initial measurement of lease liability; any lease payments made at or before the commencement date less any lease incentives received; any initial direct costs; and restoration costs. Entity-specific details about the Group’s leasing policy are provided in note 11. liability. period. • • • • 70 (m) Cash and cash equivalents Cash and cash equivalents include cash on hand, deposits held at call with banks, other short-term highly liquid investments with original maturities of three months or less. (n) Other receivables Other receivables are recognised at amortised cost, less any allowance for expected credit losses. (o) Interest in joint arrangements Joint arrangements represent the contractual sharing of control between parties in a business venture where unanimous decisions about relevant activities are required. Separate joint venture entities providing joint venturers with an interest in net assets are classified as a joint venture and accounted for using the equity method of accounting, whereby the investment is initially recognised at cost and adjusted thereafter for the post-acquisition change in the Consolidated entity's share of net assets of the joint venture. (p) Exploration and development expenditure Exploration, evaluation and development expenditure incurred are capitalised in respect of each identifiable area of interest. These costs are only capitalised to the extent that they are expected to be recovered through the successful development of the area or where activities in the area have not yet reached a stage that permits reasonable assessment of the existence of economically recoverable reserves. A regular review is undertaken of each area of interest to determine the appropriateness of continuing to capitalise costs in relation to that area of interest. Costs of site restoration are provided over the life of the project from when exploration commences and are included in the costs of that stage. Site restoration costs include the dismantling and removal of mining plant, equipment and building structures, waste removal, and rehabilitation of the site in accordance with local laws and regulations and clauses of the permits. Such costs have been determined using estimates of future costs, current legal requirements, and technology on an undiscounted basis. Any changes in the estimates for the costs are accounted on a prospective basis. In determining the costs of site restoration, there is uncertainty regarding the nature and extent of the restoration due to community expectations and future legislation. Accordingly, the costs have been determined on the basis that the restoration will be completed within one year of abandoning the site. (q) Impairment of non-financial assets At each reporting date, the Consolidated entity assesses whether there is any indication that a set may be impaired. The assessment will include the consideration of external and internal sources of information. If such an indication exists, an impairment test is carried out on the asset by comparing the recoverable amount of the asset, being the higher of the asset's fair value less costs to sell and value in use, to the assets carrying amount. Any excess of the asset's carrying amount over its recoverable amount is recognised immediately in profit or loss. Where it is not possible to estimate the recoverable amount of an individual asset, the Consolidated entity estimates the recoverable amount of the cash-generating unit to which the asset belongs. 71 8383 Lake Resources NL Note to the consolidated financial statements 30 June 2023 1 Significant accounting policies (continued) (r) Property, plant and equipment The Consolidated entity's accounting policy for land and buildings is explained in note 12. All other property, plant and equipment is stated at historical cost less depreciation. Historical cost includes expenditure that is directly attributable to the acquisition of the items. Cost may also include transfers from equity of any gains or losses on qualifying cash flow hedges of foreign currency purchases of property, plant and equipment. Subsequent costs are included in the asset's carrying amount or recognised as a separate asset, as appropriate, only when it is probable that future economic benefits associated with the item will flow to the Consolidated entity and the cost of the item can be measured reliably. The carrying amount of any component accounted for as a separate asset is derecognised when replaced. All other repairs and maintenance are charged to profit or loss during the reporting year in which they are incurred. The depreciation methods and years used by the Consolidated entity are disclosed in note 12. The asset's residual values and useful lives are reviewed, and adjusted if appropriate, at the end of each reporting year. An assets' carrying amount is written down immediately to its recoverable amount if the asset's carrying amount is greater than its estimated recoverable amount (note 1(q)). Gains and losses on disposals are determined by comparing proceeds with carrying amount. These are included in profit or loss. When revalued assets are sold, it is Consolidated entity policy to transfer any amounts included in other reserves in respect of those assets to retained earnings. (s) Trade and other payables These amounts represent liabilities for goods and services provided to the Consolidated entity prior to the end of the financial year which are unpaid. Due to their short-term nature, they are measured at amortised cost and are not discounted. The amounts are unsecured and are usually paid within 30 days of recognition. (t) Borrowings Loans and borrowings are initially recognised at the fair value of the consideration received, net of transaction costs. They are subsequently measured at amortised cost using the effective interest method. Where there is an unconditional right to defer settlement of the liability for at least 12 months after the reporting date, the loans or borrowings are classified as non-current. (u) Finance costs Finance costs attributable to qualifying assets are capitalised as part of the asset. All other finance costs are expensed in the period in which they are incurred. Other borrowing costs are expensed in the year in which they are incurred. (v) Employee benefits (i) Short-term employee benefits Liabilities for wages and salaries, including non-monetary benefits, annual leave and long service leave expected to be settled wholly within 12 months of the reporting date are measured at the amounts expected to be paid when the liabilities are settled. (ii) Defined contribution superannuation expense Contributions to defined contribution superannuation plans are expensed in the period in which they are incurred. 72 84 LAKE RESOURCES ANNUAL REPORT 2023 Lake Resources NL 30 June 2023 Note to the consolidated financial statements 1 Significant accounting policies (continued) (r) Property, plant and equipment The Consolidated entity's accounting policy for land and buildings is explained in note 12. All other property, plant and equipment is stated at historical cost less depreciation. Historical cost includes expenditure that is directly attributable to the acquisition of the items. Cost may also include transfers from equity of any gains or losses on qualifying cash flow hedges of foreign currency purchases of property, plant and equipment. Subsequent costs are included in the asset's carrying amount or recognised as a separate asset, as appropriate, only when it is probable that future economic benefits associated with the item will flow to the Consolidated entity and the cost of the item can be measured reliably. The carrying amount of any component accounted for as a separate asset is derecognised when replaced. All other repairs and maintenance are charged to profit or loss during the reporting year in which they are incurred. The depreciation methods and years used by the Consolidated entity are disclosed in note 12. The asset's residual values and useful lives are reviewed, and adjusted if appropriate, at the end of each reporting year. An assets' carrying amount is written down immediately to its recoverable amount if the asset's carrying amount is greater than its estimated recoverable amount (note 1(q)). Gains and losses on disposals are determined by comparing proceeds with carrying amount. These are included in profit or loss. When revalued assets are sold, it is Consolidated entity policy to transfer any amounts included in other reserves in respect of those assets to retained earnings. (s) Trade and other payables These amounts represent liabilities for goods and services provided to the Consolidated entity prior to the end of the financial year which are unpaid. Due to their short-term nature, they are measured at amortised cost and are not discounted. The amounts are unsecured and are usually paid within 30 days of recognition. (t) Borrowings Loans and borrowings are initially recognised at the fair value of the consideration received, net of transaction costs. They are subsequently measured at amortised cost using the effective interest method. Where there is an unconditional right to defer settlement of the liability for at least 12 months after the reporting date, the loans or borrowings are classified as non-current. (u) Finance costs Finance costs attributable to qualifying assets are capitalised as part of the asset. All other finance costs are expensed in the period in which they are incurred. Other borrowing costs are expensed in the year in which they are incurred. Liabilities for wages and salaries, including non-monetary benefits, annual leave and long service leave expected to be settled wholly within 12 months of the reporting date are measured at the amounts expected to be paid when the (v) Employee benefits (i) Short-term employee benefits liabilities are settled. (ii) Defined contribution superannuation expense Contributions to defined contribution superannuation plans are expensed in the period in which they are incurred. 72 Lake Resources NL Note to the consolidated financial statements 30 June 2023 1 Significant accounting policies (continued) (v) Employee benefits (continued) (iii) Other long-term employee benefit obligations The Consolidated entity also has liabilities for long service leave and annual leave that are not expected to be settled wholly within 12 months after the end of the year in which the employees render the related service. These obligations are therefore measured as the present value of expected future payments to be made in respect of services provided by employees up to the end of the reporting year using the projected unit credit method. Consideration is given to expected future wage and salary levels, experience of employee departures and years of service. Expected future payments are discounted using market yields at the end of the reporting year of high-quality corporate bonds with terms and currencies that match, as closely as possible, the estimated future cash outflows. The obligations are presented as current liabilities in the balance sheet if the entity does not have an unconditional right to defer settlement for at least 12 months after the reporting year, regardless of when the actual settlement is expected to occur. (iv) Share-based payments Equity-settled and cash-settled share-based compensation benefits are provided to employees and consultants. Equity-settled transactions are awards of shares, or options over shares, that are provided to employees and consultants 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. The cost 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 entity receives 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 cost of cash-settled transactions is initially, and at each reporting date until vested, determined by applying either the Binomial or Black-Scholes option pricing model, taking into consideration the terms and conditions on which the award was granted. The cumulative charge to profit or loss until settlement of 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 date multiplied 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 value of the liability at the reporting date. All changes in the liability are recognised in profit or loss. The ultimate cost of cash-settled transactions is the cash paid to settle the liability. Market conditions are taken into consideration in determining fair value. Therefore, any awards subject to market conditions are considered to vest irrespective of whether or not that market condition has been met, provided all other conditions are satisfied. 73 8585 Lake Resources NL Note to the consolidated financial statements 30 June 2023 1 Significant accounting policies (continued) (v) Employee benefits (continued) (iv) Share-based payments (continued) If equity-settled awards are modified, as a minimum an expense is recognised as if the modification has not been made. An additional expense is recognised, over the remaining vesting period, for any modification that increases the total fair value of the share-based compensation benefit as at the date of modification. If the non-vesting condition is within the control of the Consolidated entity or employee, the failure to satisfy the condition is treated as a cancellation. If the condition is not within the control of the Consolidated entity or employee and is not satisfied during the vesting period, any remaining expense for the award is recognised over the remaining vesting period, unless the award is forfeited. If equity-settled awards are 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. (w) Fair value of assets and liabilities The Consolidated entity may measure some of its assets and liabilities at fair value on either a recurring or non-recurring basis after initial recognition, depending in the requirements of the applicable Accounting Standard. Currently though there are assets or liabilities measured at fair value. Fair value is the price the Consolidated entity would receive to see an asset or would have to pay to transfer a liability in an orderly (i.e., unforced) transaction between independent, knowledgeable, and willing market participants at the measurement date. As fair value is a market-based measure, the closest equivalent observable market pricing information is used to determine fair value. Adjustments to market values may be made having regard to the characteristics of the specific asset or liability. The fair values of assets and liabilities that are not traded in an active market are determined using one or more valuation techniques. These valuations techniques maximise, the use of observable market data. to the extent possible, For non-financial assets, the fair value measurement also takes into account a market participant's ability to use the asset in its highest and best use or to sell it to another market participant that would use the asset in its highest and best use. Assets and liabilities measured at fair value are classified, into three levels, using a fair value hierarchy that reflects the significance of the inputs used in making the measurements, using a three level hierarchy, based on the lowest level of input that is significant to the entire fair value measurement, being: Level 1: Quoted prices (unadjusted) in active markets for identical assets or liabilities that the entity can access at Level 2: the measurement date; Inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly or indirectly; Level 3: Unobservable inputs for the asset or liability. Classifications are reviewed at each reporting date and transfers between levels are determined based on a reassessment of the lowest level of input that is significant to the fair value measurement. 86 74 LAKE RESOURCES ANNUAL REPORT 2023 Lake Resources NL 30 June 2023 Note to the consolidated financial statements 1 Significant accounting policies (continued) (v) Employee benefits (continued) (iv) Share-based payments (continued) If equity-settled awards are modified, as a minimum an expense is recognised as if the modification has not been made. An additional expense is recognised, over the remaining vesting period, for any modification that increases the total fair value of the share-based compensation benefit as at the date of modification. If the non-vesting condition is within the control of the Consolidated entity or employee, the failure to satisfy the condition is treated as a cancellation. If the condition is not within the control of the Consolidated entity or employee and is not satisfied during the vesting period, any remaining expense for the award is recognised over the remaining vesting period, unless the award is forfeited. If equity-settled awards are 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. (w) Fair value of assets and liabilities The Consolidated entity may measure some of its assets and liabilities at fair value on either a recurring or non-recurring basis after initial recognition, depending in the requirements of the applicable Accounting Standard. Currently though there are assets or liabilities measured at fair value. Fair value is the price the Consolidated entity would receive to see an asset or would have to pay to transfer a liability in an orderly (i.e., unforced) transaction between independent, knowledgeable, and willing market participants at the measurement date. As fair value is a market-based measure, the closest equivalent observable market pricing information is used to determine fair value. Adjustments to market values may be made having regard to the characteristics of the specific asset or liability. The fair values of assets and liabilities that are not traded in an active market are determined using one or more valuation techniques. These valuations techniques maximise, to the extent possible, the use of observable market data. best use. For non-financial assets, the fair value measurement also takes into account a market participant's ability to use the asset in its highest and best use or to sell it to another market participant that would use the asset in its highest and Assets and liabilities measured at fair value are classified, into three levels, using a fair value hierarchy that reflects the significance of the inputs used in making the measurements, using a three level hierarchy, based on the lowest level of input that is significant to the entire fair value measurement, being: Level 1: Quoted prices (unadjusted) in active markets for identical assets or liabilities that the entity can access at Level 2: Inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either the measurement date; directly or indirectly; Level 3: Unobservable inputs for the asset or liability. Classifications are reviewed at each reporting date and transfers between levels are determined based on a reassessment of the lowest level of input that is significant to the fair value measurement. 74 Lake Resources NL Note to the consolidated financial statements 30 June 2023 1 Significant accounting policies (continued) (w) Fair value of assets and liabilities (continued) For recurring and non-recurring fair value measurements, external valuers may be used when internal expertise is either not available or when the valuation is deemed to be significant. External valuers are selected based on market knowledge and reputation. Where there is a significant change in fair value of an asset or liability from one period to another, an analysis is undertaken, which includes a verification of the major inputs applied in the latest valuation and a comparison, where applicable, with external sources of data. Refer to note 8 and 19 for the disclosures on inputs used in the fair value measurement of share based payments granted during the year and fair valuing of financial instruments as at 30 June 2023. (x) Provisions Provisions for legal claims, service warranties and make good obligations are recognised when the Consolidated entity has a present legal or constructive obligation as a result of past events, it is probable that an outflow of resources will be required to settle the obligation and the amount can be reliably estimated. Provisions are not recognised for future operating losses. Provisions are measured using the best estimate of the amounts required to settle the obligation at the end of the reporting period. Issued capital (y) Ordinary shares are classified as equity. Incremental costs directly attributable to the issue of new shares or options are shown in equity as a deduction, net of tax, from the proceeds. (z) Earnings per share (i) Basic earnings per share Basic earnings per share is calculated by dividing the profit attributable to the owners of Lake Resources NL, excluding any costs of servicing equity other than ordinary 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. (ii) Diluted earnings per share Diluted earnings per share adjusts the figures used in the determination of basic earnings per share to take into account the after-income tax 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. (aa) Goods and Services Tax (GST) and other similar taxes Revenues, expenses, and assets are recognised net of the amount of GST, except where the amount of GST incurred is not recoverable from the Australian Tax Office. Receivables and payables are stated inclusive of the amount of GST receivable or payable. The net amount of GST recoverable from, or payable to, the ATO are presented as operating cash flows included in receipts from customers or payments to suppliers. Cash flows are presented on a gross basis. The GST components of cash flows arising from investing or financing activities which are recoverable from, or payable to, the ATO are presented as operating cash flows included in receipts from customers or payments to suppliers. 75 8787 Lake Resources NL Note to the consolidated financial statements 30 June 2023 1 Significant accounting policies (continued) (aa) Goods and Services Tax (GST) and other similar taxes (continued) 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 amount is recognised in Exploration & Evaluation asset. In FY 2023, VAT receivable were reclassified from current to non-current and carried at amortised cost which is measured based on a discounted cashflow model. (ab)Comparative figures When required by Accounting Standards, comparative figures have been adjusted to conform to changes in presentation for the current financial year. 2 Critical accounting judgements, estimates and assumptions The preparation of the financial statements requires management to make judgements, estimates and assumptions that affect the reported amounts in the financial statements. Management continually evaluates its judgements and estimates in relation to assets, liabilities, revenue and expenses. Management bases its judgements, estimates and assumptions on historical experience and on other various factors, including expectations future events, management believes to be reasonable under the circumstances. The resulting accounting of judgements and estimates will seldom equal the related actual results. The judgements estimates and assumptions that have a significant risk of causing a material adjustment to the carrying amounts of assets and liabilities (refer to the respective notes) within the next financial year are discussed below. liabilities, contingent (a) Share-based payment transactions The Consolidated entity measures 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. Refer to Note 19 for the disclosures on inputs used in the fair value measurement of share based payments granted during the year. (b) Exploration and evaluation costs Exploration and evaluation costs have been capitalised on the basis that the Consolidated entity will 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 88 76 LAKE RESOURCES ANNUAL REPORT 2023 Lake Resources NL 30 June 2023 Note to the consolidated financial statements Lake Resources NL Note to the consolidated financial statements 30 June 2023 1 Significant accounting policies (continued) 2 Critical accounting judgements, estimates and assumptions (continued) (aa) Goods and Services Tax (GST) and other similar taxes (continued) 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 amount is recognised in Exploration & Evaluation asset. In FY 2023, VAT receivable were reclassified from current to non-current and carried at amortised cost which is measured based on a discounted cashflow model. When required by Accounting Standards, comparative figures have been adjusted to conform to changes in (ab)Comparative figures presentation for the current financial year. 2 Critical accounting judgements, estimates and assumptions The preparation of the financial statements requires management to make judgements, estimates and assumptions that affect the reported amounts in the financial statements. Management continually evaluates its judgements and estimates in relation to assets, liabilities, contingent liabilities, revenue and expenses. Management bases its judgements, estimates and assumptions on historical experience and on other various factors, including expectations of future events, management believes to be reasonable under the circumstances. The resulting accounting judgements and estimates will seldom equal the related actual results. The judgements estimates and assumptions that have a significant risk of causing a material adjustment to the carrying amounts of assets and liabilities (refer to the respective notes) within the next financial year are discussed below. (a) Share-based payment transactions The Consolidated entity measures 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 Refer to Note 19 for the disclosures on inputs used in the fair value measurement of share based payments granted or loss and equity. during the year. (b) Exploration and evaluation costs Exploration and evaluation costs have been capitalised on the basis that the Consolidated entity will 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 (b) Exploration and evaluation costs (continued) 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. For the basis of determination the following was considered: (i) the period for which the entity has the right to explore in the specific area has expired during the period or will expire in the near future, and is not expected to be renewed - all leases were reviewed and are current with the intention to renew; (ii) substantive expenditure on further exploration for and evaluation of mineral resources in the specific area is neither budgeted nor planned - there is a budget for all project up until 2024; led to the discovery of (iii) exploration for and evaluation of mineral resources in the specific area have not commercially viable quantities of mineral resources and the entity has decided to discontinue such activities in the specific area - there is planned exploration for all current projects; (iv) sufficient data exist to indicate that, although a development in the specific area is likely to proceed, the carrying amount of the exploration and evaluation asset is unlikely to be recovered in full from the successful development or by sale - studies conducted indicate commercial viable qualities of mineral resources exist to the effect that the cost of the development including carrying amount to date will be recovered. 3 Operating segments Segment information The Consolidated entity currently operates entirely in the mineral exploration industry, with interests in Argentina and corporate operations in Australia and US. Accordingly, the information provided to the Board of Directors is prepared using the same measures used in preparing the financial statements. 76 77 8989 2 $ 2 0 2 3 $ 2 0 2 2 $ 2 0 2 3 $ 2 0 2 2 $ 2 0 2 3 $ 2 0 2 2 $ 2 0 2 3 $ 2 0 2 e n u J 0 3 e n u J 0 3 e n u J 0 3 e n u J 0 3 e n u J 0 3 e n u J 0 3 e n u J 0 3 e n u J 0 3 l a t o T S U a i l a r t s u A a n i t n e g r A e m o c n I e v i s n e h e r p m o C r e h t O d n a s s o L r o t i f o r P f o t n e m e t a t S s t n e m e t a t s l a i c n a n i f d e t a d i l o s n o c e h t o t e t o N L N s e c r u o s e R e k a L 3 2 0 2 e n u J 0 3 ) d e u n i t n o c ( s t n e m g e s g n i t a r e p O 3 ) d e u n i t n o c ( n o i t a m r o f n i t n e m g e S n o i t a m r o f n i l a c i h p a r g o e G 90 ) 5 9 0 , 3 8 6 , 5 ( ) 3 4 0 , 3 5 2 , 7 4 ( , 1 1 7 5 7 7 3 2 , , 5 8 6 2 2 5 6 6 , 3 9 0 , 5 1 6 2 9 6 , 9 2 2 4 9 8 , 8 1 3 , 1 2 1 2 , 6 1 5 , 1 5 8 2 , 5 8 8 , 3 2 2 4 1 3 , 7 1 4 , 3 9 1 ) 4 2 8 , 2 5 0 , 5 ( ) 8 2 8 , 2 9 0 , 7 1 ( ) 9 1 9 , 1 7 5 , 7 1 2 ( ) 6 5 0 , 4 0 0 , 6 1 1 ( - - - - - - - ) 6 6 6 , 4 5 9 , 8 ( ) 9 3 8 , 2 2 8 , 9 ( ) 4 5 2 , 3 8 0 , 0 6 ( 4 4 7 , 9 3 1 , 4 7 7 8 , 4 8 7 , 1 2 - - 5 7 7 , 6 8 3 , 1 - 4 0 2 , 9 5 8 5 , 6 3 6 , 3 - - 4 8 5 , 6 2 9 8 8 , 5 0 6 2 9 6 , 9 2 2 7 3 4 , 9 2 1 0 1 3 , 2 9 2 , 1 6 2 1 , 9 3 1 , 0 2 5 8 6 , 2 2 5 , 6 6 3 5 9 , 5 8 0 , 1 1 6 3 5 , 6 0 8 , 1 9 1 5 2 6 , 4 3 7 , 2 0 1 9 4 7 , 8 7 0 , 2 3 6 3 7 , 6 9 5 , 9 7 e h t r o f e s n e p x e x a t e m o c n i r e t f a s s o L e c a p s r a e y e r u t i d n e p x e n o i t a r o p x E l s n o i t i d d a t e s s A i t n e m p u q e d n a t n a p , y t r e p o r l P t e s s A e s a e L e s U - f o - t h g R i s t e s s a t n e m g e s l a t o T e c a p s ) 9 9 0 , 7 6 2 , 3 1 ( ) 5 0 7 , 1 6 8 , 3 7 1 ( 1 5 9 , 9 3 1 , 5 0 1 ) 4 1 2 , 0 1 7 , 3 4 ( ) 8 0 9 , 6 7 8 , 7 0 2 ( ) 8 7 4 , 0 9 0 , 0 2 ( ) 7 4 8 , 0 0 7 , 1 ( 8 6 0 , 8 0 7 , 7 8 ) 7 7 9 , 1 5 3 , 3 ( ) 8 1 4 , 0 1 7 , 4 8 ( s e i t i l i b a i l t n e m g e s l a t o T LAKE RESOURCES ANNUAL REPORT 2023 Lake Resources NL Note to the consolidated financial statements 30 June 2023 4 Foreign exchange gains and losses Realized gain or loss Unrealized gain or loss 5 Loss before income tax Loss before income tax includes the following specific expenses: (a) Administrative expenses Office expenses Short-term lease expenses Other expenses Computer/Software Licence fees space (b) Corporate expenses Travel Investor Relations Share Registry Maintenance Marketing Expenses - Advertising IT Support Service Costs Insurance Auditors fees (c) Employee benefit expense Superannuation Wages, salary and other benefits space (d) Share based payment Share based payments expense space 2023 $ 2022 $ (506,380) (25,071,320) (25,577,700) 22,620 (2,427,077) (2,404,457) 2023 $ 2022 $ 398,887 211,693 1,636,218 726,470 2,973,268 3,276,135 808,548 399,733 221,534 507,289 3,692,857 539,610 9,445,706 379,342 48,944 218,867 79,363 726,516 570,872 1,345,086 710,659 299,837 1,772 140,696 489,960 3,558,882 185,583 13,792,361 13,977,944 131,025 1,704,563 1,835,588 13,018,995 2,425,591 79 9191 Lake Resources NL Note to the consolidated financial statements 30 June 2023 5 Loss before income tax (continued) (e) Consultancy and legal costs Directors fees Other Consulting Fee Legal expenses (f) Finance (income) and expenses Interest and finance charges payable for lease liabilities Interest expense a a 2023 $ 2022 $ 1,288,722 1,003,753 10,494,681 2,617,371 15,404,527 244,143 481,171 1,979,687 669,050 3,374,051 182,834 14,074 196,908 8,090 1,588 9,678 (g) Gain on Electronic Payment Market (MEP Dollar) The Argentine government has instituted exchange controls restricting the purchase of foreign currencies. As a result of these exchange controls, the Group use a legal trading mechanism commonly known as the MEP Dollar in which the Argentinian subsidiaries, Morena Del Valle SA and Minerales Australes SA buy Argentinian bonds in USD, and then sell the bonds, via local banking broker in Argentina, for Argentinian Peso. This is to enable the Group to fund working capital and exploration activities in its Argentinian operations. The MEP Dollar exchange rate has diverged significantly from Argentina’s official exchange rate resulting in the Group recognising a gain from MEP Dollar bond transactions. MEP Dollar mechanism requires 24 hours holding period on the US Dollar denominated security that is purchased, therefore exposes the Company to substantive market risk during the holding period the exact amount of US Dollars cannot be reliably obtained until the holding period has expired. The MEP Dollar bonds are classified as financial assets at fair value through profit and loss, where the gain or loss associated with the trading of these financial instruments are treated as other income or other expenses. A gain of $43,696,631 was recognised in the year ended (2022: $9,356,830). The Group held no unsettled MEP Dollar bonds at 30 June 2023 (30 June 2022: $Nil). 92 80 LAKE RESOURCES ANNUAL REPORT 2023 Lake Resources NL Note to the consolidated financial statements 30 June 2023 6 Income tax expense (a) Reconciliation Current tax on profits for the year Deferred income tax benefit Aggregated Income tax (benefit)/expense (b) Numerical reconciliation of income tax expense 2023 $ 2022 $ (7,696,875) 8,143,514 446,639 (1,413,010) 2,101,676 688,666 The prima facie income tax on the loss is reconciled to the income tax expense as follows: (23,504,571) (4,994,428) Prima facie tax benefit 30% (2022 - 30%) on loss before income tax space Add tax effect of: Non deductible expenses Deferred tax asset not recognised Argentinian tax inflation adjustment Income tax expense (7,051,371) (1,498,328) 3,400,791 8,143,514 (4,046,295) 446,639 761,456 2,101,676 (676,138) 688,666 23,057,932 4,305,762 The Consolidated entity has unrecouped, unconfirmed carry forward tax losses of approximately $81,380,323 (2022: $46,204,746). A deferred income tax asset arising from carry forward tax losses will only be recognised to the extent that: (a) (b) (c) it is probable that the Consolidated entity will derive future assessable income of a nature and of an amount sufficient to enable the benefits from the deductions for the losses to be realised; the Consolidated entity continues to comply with the conditions for deductibility imposed by the law; and no changes in tax legislation adversely affect the Consolidated entity in realising the benefit from the losses. 81 9393 Lake Resources NL Note to the consolidated financial statements 30 June 2023 6 Income tax expense (continued) (c) Deferred tax assets The balance comprises temporary differences attributable to: Accrued expenses Employee provisions Business related costs (s 40-880) Unrealised foreign exchange losses Carry forward losses Deferred tax assets not recognised in equity: Capital Raising Expenses Total deferred tax assets Set-off of deferred tax liabilities pursuant to set-off provisions Deferred tax assets not recognised Net deferred tax assets (d) Deferred tax liabilities The balance comprises temporary differences attributable to: Exploration Expenditure Total deferred tax liabilities Set-off of deferred tax liabilities pursuant to set-off provisions Net deferred tax liabilities 94 2023 $ 2022 $ 677,686 95,176 41,861 54,343 24,414,097 25,283,163 398,668 38,646 74,618 728,123 13,861,343 15,101,398 689,861 25,973,024 1,551,720 16,653,118 (8,757,238) (17,215,786) - (5,893,145) (10,759,973) - 2023 $ 2022 $ (8,757,238) (8,757,238) (5,893,145) (5,893,145) 8,757,238 - 5,893,145 - 82 LAKE RESOURCES ANNUAL REPORT 2023 Lake Resources NL 30 June 2023 Note to the consolidated financial statements 6 Income tax expense (continued) (c) Deferred tax assets The balance comprises temporary differences attributable to: Accrued expenses Employee provisions Business related costs (s 40-880) Unrealised foreign exchange losses Carry forward losses Deferred tax assets not recognised in equity: Capital Raising Expenses Total deferred tax assets Set-off of deferred tax liabilities pursuant to set-off provisions Deferred tax assets not recognised Net deferred tax assets (d) Deferred tax liabilities The balance comprises temporary differences attributable to: Exploration Expenditure Total deferred tax liabilities Net deferred tax liabilities Set-off of deferred tax liabilities pursuant to set-off provisions 8,757,238 5,893,145 2023 $ 2022 $ 677,686 95,176 41,861 54,343 398,668 38,646 74,618 728,123 24,414,097 25,283,163 13,861,343 15,101,398 689,861 25,973,024 1,551,720 16,653,118 (8,757,238) (5,893,145) (17,215,786) (10,759,973) 2023 $ 2022 $ (8,757,238) (8,757,238) (5,893,145) (5,893,145) - - - - 82 Lake Resources NL Note to the consolidated financial statements 30 June 2023 7 Cash and cash equivalents Current assets Cash at bank Deposits at call 8 Trade receivables (a) Current assets Current assets Other receivables VAT receivable Related party receivable Interest receivable Security deposit 2023 $ 2022 $ 26,362,624 62,854,842 89,217,466 145,154,034 30,290,031 175,444,065 2023 $ 2022 $ 582,449 - 200,000 291,899 860,875 1,935,223 471,265 4,147,682 1,077,773 37,973 - 5,734,693 As at 30 June 2022, a net related party receivable balance of $1,077,773 was disclosed, representing cash advances and expense payments for former Lake Resources NL Chief Executive Officer and Managing Director (Mr. Promnitz). During the 2023 financial year, funds totalling $450,000 were received from Mr. Promnitz, for payment of his prior year options issued by Lake Resources NL, and $427,773 offset against the receivable balance. Following negotiations with Mr. Promnitz' legal representative, a further write-down occurred during the 2023 financial year, with final related party receivable balance of $200,000 reported at 30 June 2023. This aligns with final settlement amount to be received during the 2024 financial year. Due to the short-term nature of the related party receivable balance, its fair value is taken to equate to carrying amount as reported at 30 June 2023. The maximum exposure to credit risk for the Consolidated entity, is the carrying value of the related party receivable balance. Nil collateral is held as security in relation to the balance due. Security deposit balances relates to demand deposits of $860,875 (2022: nil) that are required to be maintained as security and can be used only to settle future claims or amount due, if any, on termination of contract. The contractual restriction on the use of demand deposits and adjustment review ends after the first full year following the effective date of the agreement estimated to be 1 January 2024. 83 9595 Lake Resources NL Note to the consolidated financial statements 30 June 2023 8 Trade receivables (continued) (b) VAT Receivable Non current Other financial assets 2023 $ 2022 $ 1,046,001 1,046,001 - - The Group has a total of $1,046,001 (2022: $Nil) of non-current Value Added Tax (VAT) recoveries due from the Argentina Revenue Authority. The Group records VAT at fair value due to the hyperinflationary economy in Argentina and the highly devaluing local currency. Fair value has been determined using a discounted cash flow valuation technique based on the forecast timing of recovery. In FY 2023, VAT receivable was classified from current to non-current. 9 Other current assets Prepayments Deposits Current Tax Asset 10 Exploration and evaluation Exploration and evaluation asset Opening net book amount Additions - direct exploration cost Effect of foreign currency translation VAT Receivable 2023 $ 2022 $ 1,412,238 324 7,773 1,420,335 280,906 5,361 - 286,267 2023 $ 2022 $ 41,549,942 66,522,685 (9,896,764) - 98,175,863 21,736,854 23,496,549 (2,738,531) (944,930) 41,549,942 Exploration and evaluation costs are carried forward in the statement of financial position as detailed in accounting policy Note 1. The Consolidated entity determined no indicators of impairment were identified during the period, hence no provision for impairment was recorded in the financial statements for the year ended 30 June 2023. The recoverability of exploration project acquisition costs is dependent upon the successful development and commercial exploitation, or alternatively the sale of areas of interest. 96 84 LAKE RESOURCES ANNUAL REPORT 2023 Lake Resources NL 30 June 2023 Note to the consolidated financial statements 8 Trade receivables (continued) (b) VAT Receivable Non current Other financial assets non-current. 9 Other current assets Prepayments Deposits Current Tax Asset Exploration and evaluation asset Opening net book amount Additions - direct exploration cost Effect of foreign currency translation VAT Receivable 10 Exploration and evaluation, development and mine properties Exploration and evaluation costs are carried forward in the statement of financial position as detailed in accounting policy Note 1. The Consolidated entity determined no indicators of impairment were identified during the period, hence no provision for impairment was recorded in the financial statements for the year ended 30 June 2023. The recoverability of exploration project acquisition costs is dependent upon the successful development and commercial exploitation, or alternatively the sale of areas of interest. 2023 $ 2022 $ 1,046,001 1,046,001 - - 2023 $ 2022 $ 1,412,238 324 7,773 280,906 5,361 - 1,420,335 286,267 2023 $ 2022 $ 41,549,942 66,522,685 (9,896,764) - 98,175,863 21,736,854 23,496,549 (2,738,531) (944,930) 41,549,942 84 Lake Resources NL Note to the consolidated financial statements 30 June 2023 11 Right-of-use asset and lease liabilities (a) Amounts recognised in the statement of financial position The statement of financial position shows the following amounts relating to leases: The Group has a total of $1,046,001 (2022: $Nil) of non-current Value Added Tax (VAT) recoveries due from the Argentina Revenue Authority. The Group records VAT at fair value due to the hyperinflationary economy in Argentina and the highly devaluing local currency. Fair value has been determined using a discounted cash flow valuation technique based on the forecast timing of recovery. In FY 2023, VAT receivable was classified from current to Right-of-use assets Opening balance Additions Accumulated depreciation Exchange differences Asset write off Net book amount 2023 $ 2022 $ 229,692 1,516,212 (71,400) (257,778) (1,335,920) 80,806 - 258,111 (28,419) - - 229,692 Additions to the right-of-use assets during the 2023 financial year were $1,516,212 (2022 - $258,111). The Group's leases primarily relate to real commercial property leases in Argentina, as at year end. Lease liabilities Current Non-current 348,354 1,324,490 1,672,844 80,235 197,622 277,857 In December 2022, Lake Corporate FL LLC a subsidiary of Lake Resources NL entered into a 63 months lease for an office space in Florida with commencement date 1 December 2022, with no option to renew. Following the subsequent restructuring, increase in staff and change in operational strategy, the Group identified that an office space in Houston will be more beneficial to the Group, could accommodate all of the staff, and took the decision to relocate the Corporate office to Houston. The leased property in Florida, has been marketed with a local estate agent to be sub-leased by the firm for the remainder of the lease term. In estimating the recoverable amount of the right-of-use asset, the directors have made assumptions about the achievable market rates for similar properties with similar lease terms. Due to the associated uncertainty, it is possible that the estimates of the amount of lease payment that will be recovered through the sub-lease of the property may need to be revised during the next year. As at 30 June 2023, there have not been any indicators that the property will be successfully leased and achieving a sub-lease for only 0% of the lease payment is considered reasonably possible based on recent experience in the market and would lead to an impairment charge of $1,335,920 against the right-of-use asset in respect of the property. Lake continues to have the obligation to make lease payments. The outstanding lease liability on Florida property as at 30 June 2023 is $1,406,222. 85 9797 Lake Resources NL Note to the consolidated financial statements 30 June 2023 11 Right-of-use asset and lease liabilities (continued) (b) Amounts recognised in the statement of profit or loss and other comprehensive income Depreciation charge of right of use assets Interest expenses 2023 $ 2022 $ 59,951 - 28,419 - 182,834 8,090 (c) The Consolidated entity's leasing activities and how these are accounted for Lease terms are negotiated on an individual basis and contain a wide range of different terms and conditions. The lease agreements do not impose any covenants other than the security interests in the leased assets that are held by the lessor. Leased assets may not be used as security for borrowing purposes. The lease payments are discounted using the interest rate implicit in the lease. If that rate cannot be readily determined, which is generally the case for leases in the Consolidated entity, the lessee’s incremental borrowing rate is used, being the rate that the individual lessee would have to pay to borrow the funds necessary to obtain an asset of similar value to the right-of-use asset in a similar economic environment with similar terms, security and conditions. If a readily observable amortising loan rate is available to the individual lessee (through recent financing or market data) which has a similar payment profile to the lease, then the Consolidated entity uses that rate as a starting point to determine the incremental borrowing rate of 110.47% for leases held in Argentina. The Consolidated entity is exposed to potential future increases in variable lease payments based on an index or rate, which are not included in the lease liability until they take effect. When adjustments to lease payments based on an index or rate take effect, the lease liability is reassessed and adjusted against the right-of-use asset. Right-of-use assets are generally depreciated over the shorter of the asset's useful life and the lease term on a straight-line basis. If the Consolidated entity is reasonably certain to exercise a purchase option, the right-of-use asset is depreciated over the underlying asset’s useful life. Payments associated with short-term leases of equipment and vehicles and all leases of low-value assets are recognised on a straight-line basis as an expense in profit or loss. Short-term leases are leases with a lease term of 12 months or less without a purchase option. Low-value assets comprise IT equipment and small items of office furniture. (d) Extension and termination options Extension and termination options are included in a number of property and equipment leases across the Consolidated entity. These are used to maximise operational flexibility in terms of managing the assets used in the Consolidated entity’s operations. The majority of extension and termination options held are exercisable only by the Consolidated entity and not by the respective lessor. (e) Critical judgements in determining the lease term In determining the lease term, management considers all facts and circumstances that create an economic incentive to exercise an extension option, or not exercise a termination option. Extension options (or periods after termination options) are only included in the lease term if the lease is reasonably certain to be extended (or not terminated). 86 98 LAKE RESOURCES ANNUAL REPORT 2023 Lake Resources NL 30 June 2023 Note to the consolidated financial statements Lake Resources NL Note to the consolidated financial statements 30 June 2023 11 Right-of-use asset and lease liabilities (continued) 12 Property, plant and equipment (b) Amounts recognised in the statement of profit or loss and other comprehensive income Depreciation charge of right of use assets Interest expenses 2023 $ 2022 $ 59,951 - 28,419 - 182,834 8,090 (c) The Consolidated entity's leasing activities and how these are accounted for Lease terms are negotiated on an individual basis and contain a wide range of different terms and conditions. The lease agreements do not impose any covenants other than the security interests in the leased assets that are held by the lessor. Leased assets may not be used as security for borrowing purposes. The lease payments are discounted using the interest rate implicit in the lease. If that rate cannot be readily determined, which is generally the case for leases in the Consolidated entity, the lessee’s incremental borrowing rate is used, being the rate that the individual lessee would have to pay to borrow the funds necessary to obtain an asset of similar value to the right-of-use asset in a similar economic environment with similar terms, security and conditions. If a readily observable amortising loan rate is available to the individual lessee (through recent financing or market data) which has a similar payment profile to the lease, then the Consolidated entity uses that rate as a starting point to determine the incremental borrowing rate of 110.47% for leases held in Argentina. The Consolidated entity is exposed to potential future increases in variable lease payments based on an index or rate, which are not included in the lease liability until they take effect. When adjustments to lease payments based on an index or rate take effect, the lease liability is reassessed and adjusted against the right-of-use asset. Right-of-use assets are generally depreciated over the shorter of the asset's useful life and the lease term on a straight-line basis. If the Consolidated entity is reasonably certain to exercise a purchase option, the right-of-use asset is depreciated over the underlying asset’s useful life. Payments associated with short-term leases of equipment and vehicles and all leases of low-value assets are recognised on a straight-line basis as an expense in profit or loss. Short-term leases are leases with a lease term of 12 months or less without a purchase option. Low-value assets comprise IT equipment and small items of office furniture. (d) Extension and termination options Extension and termination options are included in a number of property and equipment leases across the Consolidated entity. These are used to maximise operational flexibility in terms of managing the assets used in the Consolidated entity’s operations. The majority of extension and termination options held are exercisable only by the Consolidated entity and not by the respective lessor. (e) Critical judgements in determining the lease term In determining the lease term, management considers all facts and circumstances that create an economic incentive to exercise an extension option, or not exercise a termination option. Extension options (or periods after termination options) are only included in the lease term if the lease is reasonably certain to be extended (or not terminated). 86 Plant and Equipment Cost Accumulated depreciation Total plant and equipment Furniture, fittings and equipment Cost Accumulated depreciation Total furniture, fittings and equipment Machinery and vehicles Cost Accumulated depreciation Total machinery and vehicles Building improvement Cost Accumulated depreciation Total building improvement Other property, plant and equipment Cost Accumulated depreciation Total other property, plant and equipment Total property, plant and equipment Consolidated 30 June 2023 $ 30 June 2022 $ 1,036,243 (9,157) 1,027,086 38,038 (7,154) 30,884 54,128 (5,399) 48,729 65,357 (3,810) 61,547 205,658 (64,361) 141,297 405,744 (47,316) 358,428 36,571 (3,655) 32,916 72,150 (3,038) 69,112 375,754 (66,317) 309,437 125,503 (22,696) 102,807 1,541,620 640,623 87 9999 Lake Resources NL Note to the consolidated financial statements 30 June 2023 12 Property, plant and equipment (continued) Plant and equipment $ Furniture, fittings and equipment $ Machinery and vehicles $ Building improvements $ Other property, plant and equipment $ Total $ 48,729 61,547 358,428 69,112 102,807 640,623 (22,141) 1,008,808 (8,310) (30,352) 3,925 (4,236) (176,753) - (40,378) (33,738) - (2,458) (59,153) 306,161 (40,378) (322,137) 1,318,894 (95,760) 1,027,086 30,884 141,297 32,916 309,437 1,541,620 11,027 37,338 364 9,548 57,416 882 1,068 79,941 52,691 (692) 331,075 (30,063) 70,715 (2,485) 123,275 (21,536) 615,094 (54,412) 48,729 61,547 358,428 69,112 102,807 640,623 30 June 2023 Carrying amount at 1 July 2022 Exchange differences Additions Depreciation charge Carrying amount at 30 June 2023 30 June 2022 Carrying amount at 1 July 2021 Additions Depreciation charge Carrying amount at 30 June 2022 (a) Revaluation, depreciation methods and useful lives Depreciation is calculated using the straight-line method to allocate the cost or revalued amounts of the assets, net of their residual values, over their estimated useful lives as follows: Building improvements • • Plant and equipment • Machinery and Vehicles • Furniture, fittings and equipment • Other property, plant and equipment 25 - 40 years 10 - 20 years 3 - 5 years 3 - 8 years 3 - 8 years Leasehold improvements are depreciated over the shorter of their useful expects to use the assets beyond the lease term. life or the lease term, unless the entity All other property, plant and equipment is recognised at historical cost less depreciation. 100 88 LAKE RESOURCES ANNUAL REPORT 2023 Lake Resources NL 30 June 2023 Note to the consolidated financial statements Lake Resources NL Note to the consolidated financial statements 30 June 2023 12 Property, plant and equipment (continued) 13 Trade and other payables Furniture, fittings and Machinery Building Other property, plant and equipment and vehicles improvements equipment $ $ $ $ Total $ Plant and equipment $ 48,729 61,547 358,428 69,112 102,807 640,623 (22,141) 1,008,808 (8,310) (30,352) 3,925 (4,236) (176,753) - (40,378) (33,738) - (2,458) (59,153) 306,161 (40,378) (322,137) 1,318,894 (95,760) 1,027,086 30,884 141,297 32,916 309,437 1,541,620 11,027 37,338 364 9,548 57,416 882 1,068 79,941 52,691 (692) 331,075 (30,063) 70,715 (2,485) 123,275 (21,536) 615,094 (54,412) 48,729 61,547 358,428 69,112 102,807 640,623 30 June 2023 Carrying amount at 1 July 2022 Additions Exchange differences Depreciation charge Carrying amount at 30 June 2023 30 June 2022 Carrying amount at 1 July 2021 Additions Depreciation charge Carrying amount at 30 June 2022 (a) Revaluation, depreciation methods and useful lives Depreciation is calculated using the straight-line method to allocate the cost or revalued amounts of the assets, net of their residual values, over their estimated useful lives as follows: Building improvements Plant and equipment • Machinery and Vehicles • • • Furniture, fittings and equipment • Other property, plant and equipment 25 - 40 years 10 - 20 years 3 - 5 years 3 - 8 years 3 - 8 years Current liabilities Trade payables Accrued expenses (Refer to note 13 (a)) Payroll tax and other statutory liabilities (a) Accrued expenses Operating Accruals Drilling and well design cost Camp construction & maintenance cost 14 Employee benefit obligations 2023 $ 2022 $ 3,653,301 7,529,576 64,948 11,247,825 3,020,511 1,328,895 165,741 4,515,147 2023 $ 2022 $ 2,876,643 2,369,688 2,283,245 7,529,576 1,328,895 - - 1,328,895 2023 2022 Current $ Non- current $ Current $ Annual leave Provision for Short-term Incentive Employee Benefits: Leave and other benefits payable Closing balance at 30 June 1,026,847 2,830,467 313,349 4,170,663 - - 1,494 1,494 85,947 - 169,661 255,608 15 Equity (a) Issued capital Non- current $ - - 4,208 4,208 Leasehold improvements are depreciated over the shorter of their useful life or the lease term, unless the entity expects to use the assets beyond the lease term. 2023 Shares 2022 Shares 2023 $ 2022 $ All other property, plant and equipment is recognised at historical cost less depreciation. Ordinary shares - fully paid 1,422,444,707 1,389,709,907 229,703,796 231,179,318 88 89 101101 Lake Resources NL Note to the consolidated financial statements 30 June 2023 15 Equity (continued) (b) Movements in share capital Details Notes Number of shares Issue price $ Opening balance 1 July 2021 Issue of shares - Director share options Issue of shares - Redcloud options Exercise of options Exercise of options Exercise of options Exercise of options Exercise of options Exercise of options Exercise of options Exercise of options Exercise of options Less: Transaction costs arising on share issue - as cash Less: Transaction cost arising on options issued - to brokers Balance 30 June 2022 Exercise of options Exercise of options Exercise of options Exercise of options Exercise of options Exercise of options Exercise of options Exercise of options Exercise of options Exercise of options Exercise of option Exercise of option Share issue - Acuity Capital Share issue- Conversion of Performance rights Less: Transaction costs arising on share issue - as cash Less: Transaction cost arising on options issued - to brokers Balance 30 June 2023 1,058,077,328 14,000,000 1,500,000 67,124,040 4,000,000 1,000,000 35,000,000 17,000 40,000,000 86,094,394 82,895,145 2,000 - - 1,389,709,907 26,000 43,000 64,300 37,503 93,000 225,000 700,000 350,000 400,000 21,837 1,000,000 2,274,157 25,000,000 2,500,000 - - 1,422,444,704 - 0.090 0.300 0.300 0.750 0.170 0.550 0.490 0.980 0.350 0.750 0.980 - - - 0.490 0.490 0.300 0.300 0.490 0.750 0.750 0.750 0.750 - 0.300 0.300 - - - - - 19(b) $ 65,748,642 1,260,000 450,000 20,137,212 3,000,000 165,000 19,250,000 8,330 39,000,000 30,133,038 62,171,359 700 (433,279) (9,711,684) 231,179,318 12,740 21,070 19,290 11,250 45,570 168,750 525,000 262,500 300,000 - 300,000 682,061 - - (334,057) (3,489,696) 229,703,610 (c) Ordinary shares Ordinary 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. 90 102 LAKE RESOURCES ANNUAL REPORT 2023 Lake Resources NL 30 June 2023 Note to the consolidated financial statements 15 Equity (continued) (b) Movements in share capital Details Opening balance 1 July 2021 Issue of shares - Director share options Issue of shares - Redcloud options Less: Transaction costs arising on share issue - as cash Less: Transaction cost arising on options issued - to brokers Balance 30 June 2022 Exercise of options Exercise of options Exercise of options Exercise of options Exercise of options Exercise of options Exercise of options Exercise of options Exercise of options Exercise of options Exercise of options Exercise of options Exercise of options Exercise of options Exercise of options Exercise of options Exercise of options Exercise of options Exercise of options Exercise of option Exercise of option Notes Number of shares Issue price $ 1,058,077,328 14,000,000 1,500,000 67,124,040 4,000,000 1,000,000 35,000,000 17,000 40,000,000 86,094,394 82,895,145 2,000 1,389,709,907 - - - - 26,000 43,000 64,300 37,503 93,000 225,000 700,000 350,000 400,000 21,837 1,000,000 2,274,157 25,000,000 2,500,000 1,422,444,704 $ 65,748,642 1,260,000 450,000 20,137,212 3,000,000 165,000 19,250,000 8,330 39,000,000 30,133,038 62,171,359 700 - - - (433,279) (9,711,684) 231,179,318 12,740 21,070 19,290 11,250 45,570 168,750 525,000 262,500 300,000 300,000 682,061 - - - (334,057) (3,489,696) 229,703,610 - 0.090 0.300 0.300 0.750 0.170 0.550 0.490 0.980 0.350 0.750 0.980 0.490 0.490 0.300 0.300 0.490 0.750 0.750 0.750 0.750 0.300 0.300 - - - - - - 90 Share issue - Acuity Capital Share issue- Conversion of Performance rights Less: Transaction costs arising on share issue - as cash Less: Transaction cost arising on options issued - to brokers 19(b) Balance 30 June 2023 (c) Ordinary shares Ordinary 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. Lake Resources NL Note to the consolidated financial statements 30 June 2023 15 Equity (continued) (c) Ordinary shares (continued) 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. (d) Share based payment transactions in share capital movements Issues 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 services as detailed in Note 19. (e) Performance rights Movements in performance rights were as follows: Name S. Crow S. Promnitz N. Lindsay Total Number of Rights granted 5,000,000 5,000,000 5,000,000 15,000,000 Grant date 15-Aug-19 15-Aug-19 15-Aug-19 Expiry date 15-Aug-24 15-Aug-24 15-Aug-24 Fair value at grant date $0.0575 $0.0575 $0.0575 Vested and exercised in a prior year - 2,500,000 2,500,000 5,000,000 Forfeited in prior year - 2,500,000 - 2,500,000 Vested and exercised during the year - - 2,500,000 2,500,000 Unvested as at 30 June 2023 5,000,000 - - 5,000,000 On 15 August 2019, 15,000,000 Performance rights were issued to Directors following approval at the shareholder meeting of 15 August 2019. The terms and conditions of performance rights on issue at 30 June 2023 affecting remuneration of directors and other key management personnel in this financial year or future reporting years are as follows: Grant date Expiry date 15-Aug-19 15-Aug-24 15-Aug-19 15-Aug-24 15-Aug-19 15-Aug-24 Value at Grant $0.0575 $0.0575 $0.0575 No. of Rights Granted 5,000,000 2,500,000 7,500,000 Performance Hurdle PFS Pilot plants Investor Performance achieved 100% 100% 100% No. vested and exercised 5,000,000 2,500,000 - No. of unvested performance rights - - Forfeited in prior year - - 5,000,000 2,500,000 Forfeited during the year - - - Performance rights outcomes are as follows: The Kachi Pre-Feasibility Study (PFS) completion resulted in 2,500,000 for N. Lindsay and 2,500,000 for S. Promnitz vested in the 2021 and converted into ordinary shares in 2022. 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. Dr. Lindsay remaining 2.5 million rights which vested on 2 November 2022, and shares were issued on 27 March 2023. As at 30 June 2022 Dr. Lindsay’s remaining 2.5 million performance rights are fully vested. In this financial period the performance right issued to Dr. Lindsay was exercise and shares have been issued while Mr. Crow’s 5 million performance right are yet to vest as the performance hurdles are yet to be met as at 30 June 2023. 91 103103 Lake Resources NL Note to the consolidated financial statements 30 June 2023 15 Equity (continued) (f) Performance shares The terms and conditions of performance shares on issue at 30 June 2023 affecting remuneration of directors, other key management personnel and employees in this financial year or future reporting years are as follows: Grant date Expiry date 12-Dec-22 24-Feb-22 12-Mar-23 24-Feb-22 12-Sep-23 24-Feb-22 12-Sep-24 24-Feb-22 1-Jun-22 24-Feb-22 1-Jun-22 24-Feb-22 1-Mar-23 24-Feb-22 1-Mar-23 24-Feb-22 22-Jan-24 12-Sept-22 22-Jan-24 12-Sept-22 22-Nov-24 12-Sept-22 Balance at the start of the year 123,809 139,285 167,142 250,714 92,343 147,749 147,749 73,874 - - - 1,142,665 Granted Converted to Shares - - - - - - - - 33,058 39,669 92,563 165,290 - - - - - - (147,749) - - - (147,749) Expired (123,809) (139,285) (92,343) (147,749) (73,874) - - - (577,060) Balance at the end of the year Vested during year but not converted - - 167,142 250,714 - - - - 33,058 39,669 92,563 583,146 - - - - - - - - - - - - Due to Dr. Lindsay's resignation on the 28 November 2022, the unwinding of his remaining performance shares was performed in the current year. Terms and conditions of performance shares issued during the year Number of Rights granted Name SVP Field Development & Evaluation 33,058 39,669 92,563 Performance measure Public announcement of a maiden JORC resource at any of the Cauchari, Olaroz or Paso de Jama Public announcement of a second maiden resource at any of Cauchari, Olaroz or Paso de Jama Successful completion of a Preliminary Economic Assessment (PEA) or Prefeasibility Study (PFS) at any of Cauchari, Olaroz or Paso de Jama prospects Measurement date Directors judgement at 30 June 2023 22-Nov-23 22-Nov-23 In the Directors judgement, this milestone will be met by measurement date. In the Directors judgement, this milestone will not be met by measurement date. 22-Aug-24 In the Directors judgement, this milestone will not be met by measurement date. 104 92 LAKE RESOURCES ANNUAL REPORT 2023 Lake Resources NL 30 June 2023 Note to the consolidated financial statements 15 Equity (continued) (f) Performance shares The terms and conditions of performance shares on issue at 30 June 2023 affecting remuneration of directors, other key management personnel and employees in this financial year or future reporting years are as follows: Grant date Expiry date start of the year Granted Shares Expired Balance at the Converted to Balance at the Vested during end of the year year but not converted 24-Feb-22 24-Feb-22 24-Feb-22 24-Feb-22 24-Feb-22 24-Feb-22 24-Feb-22 24-Feb-22 12-Sept-22 12-Sept-22 12-Sept-22 12-Dec-22 12-Mar-23 12-Sep-23 12-Sep-24 1-Jun-22 1-Jun-22 1-Mar-23 1-Mar-23 22-Jan-24 22-Jan-24 22-Nov-24 123,809 139,285 167,142 250,714 92,343 147,749 147,749 73,874 - - - - - - - - - - - - - - - - - (123,809) (139,285) (92,343) (147,749) (73,874) 167,142 250,714 - - - - - - - - - 33,058 39,669 92,563 (147,749) - - - 33,058 39,669 92,563 1,142,665 165,290 (147,749) (577,060) 583,146 Due to Dr. Lindsay's resignation on the 28 November 2022, the unwinding of his remaining performance shares was performed in the current year. Terms and conditions of performance shares issued during the year Number of Rights granted Name SVP Field Development & Evaluation Performance measure Public announcement of a maiden Measurement date Directors judgement at 30 June 2023 In the Directors judgement, this 33,058 JORC resource at any of the 22-Nov-23 milestone will be met by Cauchari, Olaroz or Paso de Jama Public announcement of a second measurement date. In the Directors judgement, this 39,669 maiden resource at any of 22-Nov-23 milestone will not be met by Cauchari, Olaroz or Paso de Jama Successful completion of a Preliminary Economic Assessment measurement date. In the Directors judgement, this 92,563 (PEA) or Prefeasibility Study (PFS) 22-Aug-24 milestone will not be met by at any of Cauchari, Olaroz or Paso measurement date. de Jama prospects - - - - - - - - - - - - 92 Lake Resources NL Note to the consolidated financial statements 30 June 2023 15 Equity (continued) (g) Options Movements in options were as follows: Grant / Vest date Expiry date Exercised price Balance at 1 July 2022 Issued Expired Exercised Balance at 30 June 2023 - 2,000,000 (162,000) 5,601,000 Option issued to KMP Option issued to Brokers/ Consultants Option issued to Brokers/ Consultants Option issued to Brokers/ Consultants Option issued to Brokers/ Consultants Option issued to Brokers/ Consultants Option issued to Brokers/ Consultants Option issued to Brokers/ Consultants Option issued to Staff Option issued to Staff Option issued to Brokers/ Consultants Option issued to Brokers/ Consultants Option issued to Director Option issued to Brokers/ Consultants Option issued to Brokers/ Consultants Option issued to KMP Option issued to Brokers/ Consultants Option issued to Staff Option issued to Staff Option issued to Staff Option issued to Staff Option issued to Staff Option issued to Staff Option issued to Staff Option issued to Staff Option issued to Staff Option issued to Staff 13-Jul-21 12-Jul-24 $0.55 2,000,000 1-Aug-22 1-Aug-24 $0.50 5,763,000 19-Jan-22 19-Jan-25 $1.48 1,000,000 14-Oct-21 25-Oct-24 $0.57 2,000,000 16-Mar-22 1-Mar-23 $1.00 100,000 16-Mar-22 15-Oct-22 $0.75 225,000 26-Apr-22 26-Apr-25 $1.42 1,036,122 - - - - - - - 26-Apr-22 26-Apr-25 20-Jul-25 20-Jul-22 26-Aug-22 26-Aug-25 $1.42 $0.70 $1.42 1,036,122 - - - 1,000,000 1,000,000 12-Sep-22 15-Jun-25 $0.75 12-Sep-22 15-Jun-25 15-Sep-22 15-Sep-27 $0.75 $1.13 24-Oct-22 24-Oct-25 $1.00 24-Oct-22 24-Oct-25 10-Oct-22 10-Oct-27 $1.00 $0.99 - - - - - - 280,000 1,260,000 4,000,000 1,500,000 1,500,000 500,000 - - - - (100,000) - - - - - - - - - - - - - - (225,000) - - - - - - - - - - 1-Jan-23 9-Jan-23 12-Sep-22 15-Jun-25 14-Nov-22 14-Nov-27 11-Oct-22 11-Oct-27 11-Nov-22 21-Nov-27 1-Jan-27 9-Jan-27 11-Jan-23 11-Jan-27 16-Jan-23 16-Jan-27 1-Feb-27 1-Feb-23 1-April-23 1-April-27 20-Jun-23 20-Jun-27 5,460,000 $0.75 75,000 $1.17 300,000 $0.99 50,000 $1.06 851,700 $0.83 1,000,000 $0.80 75,000 $0.84 100,000 $0.83 1,145,692 $0.82 150,000 $0.45 882,352 $0.31 $24.28 13,160,244 21,129,744 - - - - - - - - - - - - - - - - - - - - - - (100,000) (1,450,000) - - - - - - - - - - (1,837,000) 1,000,000 2,000,000 - - 1,036,122 1,036,122 1,000,000 1,000,000 280,000 1,260,000 4,000,000 1,500,000 1,500,000 500,000 4,010,000 75,000 300,000 50,000 851,700 1,000,000 75,000 100,000 1,145,692 150,000 882,352 32,352,988 93 105105 Lake Resources NL Note to the consolidated financial statements 30 June 2023 15 Equity (continued) (g) Options (continued) (i) The status of the outstanding options balance at 30 June 2023 is as follows: Grant/ Vest date Expiry date Exercised Price Balance at 30 June 2023 Options Vested Options Exercisable Options unvested Options Unexercisable Option issued to KMP Option issued to Brokers/ Consultants Option issued to Brokers/ Consultants Option issued to Brokers/ Consultants Option issued to Brokers/ Consultants Option issued to Brokers/ Consultants Option issued to Staff Option issued to Staff Option issued to Brokers/ Consultants Option issued to Brokers/ Consultants Option issued to Director Option issued to Brokers/ Consultants Option issued to Brokers/ Consultants Option issued to KMP Option issued to Brokers/ Consultants Option issued to Staff Option issued to Staff Option issued to Staff Option issued to Staff Option issued to Staff Option issued to Staff Option issued to Staff Option issued to Staff Option issued to Staff Option issued to Staff 13-Jul-21 12-Jul-24 $0.55 2,000,000 2,000,000 2,000,000 1-Aug-22 1-Aug-24 $0.50 5,601,000 5,601,000 5,601,000 19-Jan-22 19-Jan-25 $1.48 1,000,000 1,000,000 1,000,000 14-Oct-21 25-Oct-24 $0.57 2,000,000 2,000,000 2,000,000 26-Apr-22 26-Apr-25 $1.42 1,036,122 1,036,122 1,036,122 $1.42 26-Apr-22 26-Apr-25 20-Jul-22 20-Jul-25 $0.70 26-Aug-22 26-Aug-25 $1.42 1,036,122 1,000,000 1,000,000 1,036,122 1,000,000 1,000,000 1,036,122 1,000,000 1,000,000 12-Sep-22 15-Jun-25 $0.75 280,000 280,000 280,000 - - - - - - - - - - - - - - - - - 12-Sep-22 15-Jun-25 $0.75 15-Sep-22 15-Sep-27 $1.13 1,260,000 4,000,000 1,260,000 - 1,260,000 - - 4,000,000 - 4,000,000 24-Oct-22 24-Oct-25 $1.00 1,500,000 1,500,000 1,500,000 - - 24-Oct-22 24-Oct-25 10-Oct-22 10-Oct-27 $1.00 $0.99 1,500,000 500,000 1,500,000 - 1,500,000 - - 500,000 - 500,000 12-Sep-22 15-Jun-25 $0.75 14-Nov-22 14-Nov-27 $1.17 11-Oct-22 11-Oct-27 $0.99 11-Nov-22 21-Nov-27 $1.06 $0.83 1-Jan-23 9-Jan-23 $0.80 11-Jan-23 11-Jan-27 $0.84 16-Jan-23 16-Jan-27 $0.83 $0.82 1-Feb-23 1-Feb-27 1-Apr-23 $0.45 1-Apr-27 20-Jun-23 20-Jun-27 $0.31 1-Jan-27 9-Jan-27 4,010,000 75,000 300,000 50,000 851,700 1,000,000 75,000 100,000 1,145,692 150,000 882,352 4,010,000 - - - - - - - - - - 32,352,988 23,223,244 - 4,010,000 75,000 - 300,000 - 50,000 - - 851,700 - 1,000,000 75,000 - - 100,000 - 1,145,692 150,000 - 882,352 - 23,223,244 9,129,744 - 75,000 300,000 50,000 851,700 1,000,000 75,000 100,000 1,145,692 150,000 882,352 9,129,744 (h) Capital risk management Exploration 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 entity to 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 is in its exploration stage. There are no externally imposed capital requirements. 94 106 LAKE RESOURCES ANNUAL REPORT 2023 Lake Resources NL 30 June 2023 Note to the consolidated financial statements 15 Equity (continued) (g) Options (continued) (i) The status of the outstanding options balance at 30 June 2023 is as follows: Grant/ Vest Expiry Exercised Balance at 30 date date Price June 2023 Options Vested Options Options Options Exercisable unvested Unexercisable Option issued to KMP Option issued to Brokers/ Option issued to Brokers/ Consultants Consultants Consultants Consultants Consultants Option issued to Brokers/ Option issued to Brokers/ Option issued to Brokers/ Option issued to Staff Option issued to Staff Option issued to Brokers/ Option issued to Brokers/ Consultants Consultants Option issued to Brokers/ Consultants Consultants Option issued to Brokers/ Option issued to KMP Option issued to Brokers/ Consultants Option issued to Staff Option issued to Staff Option issued to Staff Option issued to Staff Option issued to Staff Option issued to Staff Option issued to Staff Option issued to Staff Option issued to Staff Option issued to Staff 13-Jul-21 12-Jul-24 $0.55 2,000,000 2,000,000 2,000,000 1-Aug-22 1-Aug-24 $0.50 5,601,000 5,601,000 5,601,000 19-Jan-22 19-Jan-25 $1.48 1,000,000 1,000,000 1,000,000 14-Oct-21 25-Oct-24 $0.57 2,000,000 2,000,000 2,000,000 26-Apr-22 26-Apr-25 $1.42 1,036,122 1,036,122 1,036,122 26-Apr-22 26-Apr-25 20-Jul-22 20-Jul-25 $1.42 $0.70 26-Aug-22 26-Aug-25 $1.42 1,036,122 1,000,000 1,000,000 1,036,122 1,000,000 1,000,000 1,036,122 1,000,000 1,000,000 12-Sep-22 15-Jun-25 $0.75 280,000 280,000 280,000 Option issued to Director 15-Sep-22 15-Sep-27 $1.13 - 4,000,000 4,000,000 12-Sep-22 15-Jun-25 $0.75 1,260,000 1,260,000 1,260,000 4,000,000 24-Oct-22 24-Oct-25 $1.00 1,500,000 1,500,000 1,500,000 24-Oct-22 24-Oct-25 10-Oct-22 10-Oct-27 $1.00 $0.99 1,500,000 500,000 1,500,000 1,500,000 500,000 500,000 4,010,000 4,010,000 4,010,000 - - - - - - - - - - - - - - - - - - - - - 75,000 300,000 50,000 851,700 75,000 100,000 150,000 882,352 75,000 300,000 50,000 851,700 75,000 100,000 150,000 882,352 - 1,000,000 1,000,000 - 1,145,692 1,145,692 12-Sep-22 15-Jun-25 $0.75 14-Nov-22 14-Nov-27 $1.17 11-Oct-22 11-Oct-27 $0.99 11-Nov-22 21-Nov-27 $1.06 1-Jan-23 9-Jan-23 1-Jan-27 9-Jan-27 $0.83 $0.80 11-Jan-23 11-Jan-27 $0.84 16-Jan-23 16-Jan-27 $0.83 1-Feb-23 1-Feb-27 1-Apr-23 1-Apr-27 $0.82 $0.45 20-Jun-23 20-Jun-27 $0.31 75,000 300,000 50,000 851,700 1,000,000 75,000 100,000 1,145,692 150,000 882,352 32,352,988 23,223,244 23,223,244 9,129,744 9,129,744 (h) Capital risk management Exploration 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 entity to 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 is in its exploration stage. There are no externally imposed capital requirements. - - - - - - - - - - - - - - - - - - - - - - - - - 94 Lake Resources NL Note to the consolidated financial statements 30 June 2023 16 Equity - reserves Change in proportionate interest reserve Capital profits reserve Performance rights and restricted stock units reserve Foreign currency translation reserve Option reserves Total equity reserves 2023 $ 2022 $ (8,464,134) 4,997 2,084,990 (7,988,445) 20,876,359 6,513,767 - 4,997 970,130 465,152 8,068,140 9,508,419 (a) Change in proportionate interest reserve The change in proportionate interest reserve is used to recognise differences between the amount by which non-controlling interests are adjusted and any consideration paid or received which may arise as a result of transactions with non-controlling interests that do not result in a loss of control. (b) Capital profits reserve The capital profits reserve records non-taxable profits on sale of investments. (c) Option reserve The option reserve is to recognise the fair value of options issued for share based payment to employees and service providers in relation to the supply of goods or services. Once options in a series have all been exercised or have expired, the reserve related to those options is transferred to accumulated losses. (d) Performance rights and restricted stock unit reserve The performance right and restricted stock unit reserve is to recognise the fair value of performance right and restricted stock unit issued for share based payment to employees and service providers in relation to the supply of goods or services. Once performance right or restricted stock unit in a series have all been exercised or have expired, the reserve related to those performance right and restricted stock unit is transferred to accumulated losses. (e) Foreign currency translation reserve The foreign currency translation reserve recognises exchange differences arising from the translation of the financial statements of foreign operations to Australian dollars. In the current year, the US office became operational, there was material movement arising from the hyperinflationary effect of the ARS to the Consolidated entity's consolidated financial report, and increase in Exploration & Evaluation and operational activities in that region during the year. 95 107107 Lake Resources NL Note to the consolidated financial statements 30 June 2023 16 Equity - reserves (continued) (f) Movements in reserves Movements in each class of reserve during the current and previous financial year are set out below: Capital profit reserve $ Note Option reserve $ Performance rights and restricted stock units reserve $ Change in proportionate interest reserve $ At 1 July 2021 4,997 2,625,776 345,000 Issue of unlisted options Transfer from option reserve to accumulated losses on broker options expiry/exercise Other comprehensive income Share-based payment - fee for service Vesting of performance rights to Directors At 30 June 2022 - - - - - 4,997 9,711,684 (6,069,780) - 1,800,461 - 8,068,141 - - - - 625,129 970,129 - - - - - - - Capital profit reserve $ Note Option reserve $ Performance rights and restricted stock units reserve $ Change in proportionate interest reserve $ At 1 July 2022 4,997 8,068,141 970,129 Foreign currency translation reserve $ Total other reserves $ 388,818 3,364,591 - - 9,711,684 (6,069,780) 76,334 76,334 - 1,800,461 - 465,152 625,129 9,508,419 Foreign currency translation reserve $ Total other reserves $ 465,152 9,508,419 - - 3,489,696 (2,641,312) (8,453,597) (8,453,597) - - 13,132,162 (8,464,134) 3,489,696 (2,641,312) - - - - 11,959,835 1,172,327 - - - - - - - - - - - - (8,464,134) - 4,997 - 20,876,360 (57,467) 2,084,989 - (8,464,134) - (7,988,445) (57,467) 6,513,767 96 Issue of unlisted options Transfer from option reserve to accumulated losses on broker options expiry/exercise Other comprehensive income Share-based payment - fee for service Change in interest in controlled entity Unwinding performance rights to Directors At 30 June 2023 108 LAKE RESOURCES ANNUAL REPORT 2023 Lake Resources NL 30 June 2023 Note to the consolidated financial statements 16 Equity - reserves (continued) (f) Movements in reserves Movements in each class of reserve during the current and previous financial year are set out below: Performance rights and Change in restricted proportionate Capital profit reserve $ Note Option reserve $ stock units reserve $ interest reserve Foreign currency translation reserve $ Total other reserves $ At 1 July 2021 4,997 2,625,776 345,000 388,818 3,364,591 Issue of unlisted options Transfer from option reserve to accumulated losses on broker options expiry/exercise Other comprehensive income Share-based payment - fee for service Vesting of performance rights to Directors At 30 June 2022 Issue of unlisted options Transfer from option reserve to accumulated losses on broker options expiry/exercise Other comprehensive income Share-based payment - fee for service Change in interest in controlled entity Unwinding performance rights to Directors At 30 June 2023 4,997 8,068,141 625,129 970,129 Performance rights and Change in restricted proportionate Capital profit reserve $ Note Option reserve $ stock units reserve $ interest reserve 465,152 Foreign currency translation reserve $ At 1 July 2022 4,997 8,068,141 970,129 465,152 9,508,419 - - - - - - - - - - - 9,711,684 (6,069,780) 1,800,461 - - 3,489,696 (2,641,312) - - - - - - - - - - - $ - - - - - - - - - - - - $ - (8,453,597) (8,453,597) 11,959,835 1,172,327 (8,464,134) (57,467) 4,997 20,876,360 2,084,989 (8,464,134) (7,988,445) 6,513,767 - - - - - - - - - 9,711,684 (6,069,780) 1,800,461 625,129 9,508,419 Total other reserves $ 3,489,696 (2,641,312) 13,132,162 (8,464,134) (57,467) 96 Lake Resources NL Note to the consolidated financial statements 30 June 2023 17 Earnings per share 2023 $ 2022 $ Profit/(loss) after income tax attributable to the owners of Lake Resources NL (45,754,115) (5,683,093) Number Number Weighted average number of ordinary shares used in calculating basic and diluted earnings per share 1,403,395,825 1,120,917,048 Weighted average number of ordinary shares used in calculating diluted earnings per share 1,403,395,825 1,120,917,048 76,334 76,334 Basic earnings/(loss) per share Diluted earnings/(loss) per share Cents Cents (3.26) (0.51) (3.26) (0.51) Options over ordinary shares are considered potential ordinary shares. For the year ended 30 June 2023, 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 16 and . Earnings per share for the year is not adjusted for transactions occurring after the end of the year as the transactions do not affect the amount of capital used to produce profit or loss for the year. 18 Dividends There were no dividends paid, recommended or declared during the current or previous financial year. 97 109109 Lake Resources NL Note to the consolidated financial statements 30 June 2023 19 Share-based payments During the financial year the Company equity-settled share-based payment transactions for the acquisition of goods and services, from personnel and external suppliers were charged as follows: Expensed to profit or loss - options (Note 19 (a)(i)) Capitalised as equity transaction cost (Note 19 (b)) Expensed to profit or loss - RSU (Note 19 (a)(iv)) Expensed to profit or loss - performance shares (Note 19 (a)(iii)) Total Adjusted to equity Reserve Share capital Total 2023 $ 2022 $ 11,959,835 3,489,696 1,116,628 (57,467) 16,508,692 2,425,591 9,711,684 - - 12,137,275 16,508,692 - 16,508,692 2,425,591 9,711,684 12,137,275 (a) Expensed to Profit or Loss During the year equity-settled share-based payment transactions for the payment for fees and services, expensed through profit or loss, occurred as follows: Options issued to brokers and consultants Options issued to directors, executives and employees (Note 20 (b)) 2023 $ 2022 $ 8,768,375 3,191,460 11,959,835 - 2,425,591 2,425,591 (i) Suppliers options During the period 10,000,000 options and remuneration were granted as equity-settled share-based payment transactions for the payment of fees and services, expensed through profit or loss and were determined using Black Scholes methodology utilising the following assumptions: Grant date Number of options granted Expiry date Exercise price Fair value at grant date Expensed $ 24-Oct-22 24-Oct-22 12-Sep-22 12-Sep-22 12-Sep-22 Total 1,500,000 1,500,000 5,460,000 280,000 1,260,000 10,000,000 24-Oct-25 24-Oct-25 15-Jun-25 15-Jun-25 15-Jun-25 $1.000 $1.000 $0.750 $0.750 $0.750 $1.080 $1.080 $1.260 $1.260 $1.260 1,117,581 1,117,581 5,095,906 261,329 1,175,978 8,768,375 110 98 LAKE RESOURCES ANNUAL REPORT 2023 Lake Resources NL 30 June 2023 Note to the consolidated financial statements 19 Share-based payments During the financial year the Company equity-settled share-based payment transactions for the acquisition of goods and services, from personnel and external suppliers were charged as follows: Lake Resources NL Note to the consolidated financial statements 30 June 2023 19 Share-based payments (continued) (a) Expensed to Profit or Loss (continued) (i) Suppliers options (continued) Expensed to profit or loss - options (Note 19 (a)(i)) Capitalised as equity transaction cost (Note 19 (b)) Expensed to profit or loss - RSU (Note 19 (a)(iv)) Expensed to profit or loss - performance shares (Note 19 (a)(iii)) Total Adjusted to equity Reserve Share capital Total During the year equity-settled share-based payment transactions for the payment for fees and services, expensed (a) Expensed to Profit or Loss through profit or loss, occurred as follows: Options issued to brokers and consultants Options issued to directors, executives and employees (Note 20 (b)) (i) Suppliers options During the period 10,000,000 options and remuneration were granted as equity-settled share-based payment transactions for the payment of fees and services, expensed through profit or loss and were determined using Black Scholes methodology utilising the following assumptions: Number of options Fair value at grant Grant date granted Expiry date Exercise price date Expensed $ 24-Oct-22 24-Oct-22 12-Sep-22 12-Sep-22 12-Sep-22 Total 1,500,000 1,500,000 5,460,000 280,000 1,260,000 10,000,000 24-Oct-25 24-Oct-25 15-Jun-25 15-Jun-25 15-Jun-25 $1.000 $1.000 $0.750 $0.750 $0.750 $1.080 $1.080 $1.260 $1.260 $1.260 1,117,581 1,117,581 5,095,906 261,329 1,175,978 8,768,375 2023 $ 2022 $ 11,959,835 3,489,696 1,116,628 (57,467) 2,425,591 9,711,684 - - 16,508,692 12,137,275 16,508,692 - 2,425,591 9,711,684 16,508,692 12,137,275 2023 $ 8,768,375 3,191,460 11,959,835 2022 $ - 2,425,591 2,425,591 98 Grant date Vesting Date Share Price at grant date Exercise (Strike) Price Time to Maturity (in years) Annual Risk-Free Rate Annualised Volatility 24-Oct-22 24-Oct-22 $1.080 $1.000 3 3.6% 109.949% 24-Oct-22 24-Oct-22 $1.080 $1.000 3 3.6% 109.949% 12-Sep-22 12-Sep-22 $1.260 $0.750 2.76 3.24% 109.949% 12-Sep-22 12-Sep-22 $1.260 $0.750 2.76 3.24% 109.949% 12-Sep-22 12-Sep-22 $1.260 $0.750 2.76 3.24% 109.949% The options vested immediately, and some were exercised at period end. For the period ended 30 June 2023, $8,768,375 (2022: $1,800,461) was recognised as an expense in the profit or loss. These options issued to Directors, Key Management Personnel and a senior management staff as part of Lake's Resources Employee Award Program approved during the period are detailed in Note 20. (ii) Performance rights issued to Directors On 15 August 2019 following the approval from the shareholders at the Company’s EGM, the Consolidated entity granted 15,000,000 performance rights to the then Directors as follows: Number of Rights granted Grant date Expiry date 15-Aug-24 5,000,000 15-Aug-19 15-Aug-24 5,000,000 15-Aug-19 15-Aug-24 5,000,000 15-Aug-19 Converted to Shares Forfeited - (2,500,000) (2,500,000) (5,000,000) Fair value at grant date $0.0575 $0.0575 $0.0575 15,000,000 Expensed 2023 - - - - Expensed 2022 273,125 (7,188) 107,813 373,750 Name S. Crow S. Promnitz N. Lindsay Total Directors exercised judgement in assessing that the likelihood of the remaining hurdles for the vesting of the performance rights has materially changed since the prior year. Accordingly for the year ended 30 June 2023 $nil (2022: $373,750) was expensed in the profit or loss. The expense calculation recognises the probability of the performance hurdles being achieved. 99 111111 Lake Resources NL Note to the consolidated financial statements 30 June 2023 19 Share-based payments (continued) (a) Expensed to Profit or Loss (continued) (iii) Performance shares issued to Directors and other Key Management Personnel Grant date 22-Feb-22 22-Feb-22 22-Feb-22 22-Feb-22 22-Feb-22 22-Feb-22 22-Feb-22 24-Feb-22 12-Sep-22 12-Sep-22 12-Sep-22 Number of rights/ shares granted 123,809 139,285 167,142 250,714 92,343 147,749 147,749 73,874 33,058 39,669 92,563 1,307,955 Expiry date 12-Dec-22 12-Mar-23 12-Sep-23 12-Sep-24 1-Jun-22 1-Jun-22 1-Mar-23 1-Mar-24 22-Jan-24 22-Jan-24 22-Nov-24 Converted to shares Expired Fair value at grant date Expensed 2023 $ - - - - - - 147,749 - - - 147,749 123,809 139,285 - - 92,343 147,749 - 73,874 - - - 577,060 $0.090 $0.090 $0.090 $0.090 $0.090 $0.090 $0.090 $0.090 $1.210 $1.210 $1.210 - - - - - - - (71,823) 14,356 - - (57,467) Directors exercised judgement in assessing that the likelihood of the remaining hurdles for the vesting of the performance rights has materially changed since the prior year. Accordingly for the year ended 30 June 2023, $71,823 (2022: $251,379) was credited in the profit or loss to unwind forfeited performance shares. The expense calculation recognises the probability of the performance hurdles being achieved. 112 100 LAKE RESOURCES ANNUAL REPORT 2023 Lake Resources NL 30 June 2023 Note to the consolidated financial statements 19 Share-based payments (continued) (a) Expensed to Profit or Loss (continued) (iii) Performance shares issued to Directors and other Key Management Personnel Number of rights/ shares Grant date granted Expiry date shares Expired grant date $ Converted to Fair value at Expensed 2023 22-Feb-22 22-Feb-22 22-Feb-22 22-Feb-22 22-Feb-22 22-Feb-22 22-Feb-22 24-Feb-22 12-Sep-22 12-Sep-22 12-Sep-22 123,809 139,285 167,142 250,714 92,343 147,749 147,749 73,874 33,058 39,669 92,563 12-Dec-22 12-Mar-23 12-Sep-23 12-Sep-24 1-Jun-22 1-Jun-22 1-Mar-23 1-Mar-24 22-Jan-24 22-Jan-24 22-Nov-24 - - - - - - - - - 123,809 139,285 92,343 147,749 73,874 - - - - - - 147,749 $0.090 $0.090 $0.090 $0.090 $0.090 $0.090 $0.090 $0.090 $1.210 $1.210 $1.210 - - - - - - - - - (71,823) 14,356 1,307,955 147,749 577,060 (57,467) Directors exercised judgement in assessing that the likelihood of the remaining hurdles for the vesting of the performance rights has materially changed since the prior year. Accordingly for the year ended 30 June 2023, $71,823 (2022: $251,379) was credited in the profit or loss to unwind forfeited performance shares. The expense calculation recognises the probability of the performance hurdles being achieved. Lake Resources NL Note to the consolidated financial statements 30 June 2023 19 Share-based payments (continued) (a) Expensed to Profit or Loss (continued) (iii) Performance shares issued to Directors and other Key Management Personnel (continued) Position Number of rights granted 123,809 Chief Finance Officer 139,285 167,142 250,714 92,343 147,749 147,749 73,874 33,058 39,669 92,563 Former Technical Director SVP Field Development & Evaluation Performance measure Measurement date Directors judgement at 30 June 2023 Delivering and operating a comprehensive reporting package for the debt financiers and potential J.V. partners post close of the Kachi Project finance and closing of debt financing for the Company’s Kachi Project (60%). Delivering and operating a comprehensive reporting package for the debt financiers and potential J.V. partners post close of the Kachi Project finance. Maintain and deliver accurate reporting across all facets of the business incorporating cash flows, pre-production and budgeting. Preparation of financial documents to the satisfaction of financiers, project banking syndicates and export credit agencies. Implementation and maintenance of acceptable budgetary and cash flow measures across Australia and Argentina Delivery of the Kachi Project into production with appropriate reporting mechanisms in place Commencement of exploration and testing of brines from at least one of the Company’s other projects The Company putting a project team in place to build the Project DFS and building the demonstration plant on site The Company closing the debt and equity financing for the Company’s Kachi Project on terms satisfactory to the Company The Company receiving approval for the financing of an expansion case being up to 50,000 tonnes per annum lithium carbonate equivalent total production at the Kachi Project Public announcement of a maiden JORC resource at any of the Cauchari, Olaroz or Paso de Jama Public announcement of a second maiden resource at any of Cauchari, Olaroz or Paso de Jama Successful completion of a Preliminary Economic Assessment (PEA) or Prefeasibility Study (PFS) at any of Cauchari, Olaroz or Paso de Jama prospects 12-Oct-22 This milestone was not be met by 12 October 2022. Nil expense recorded as expired. 12-Jan-23 This milestone was not met by 12 January 2023. Nil expense recorded. 12-Jul-23 In the Director's judgement, this milestone will not be met by 12 July 2023. Nil expense recorded. 12-Jul-24 1-Apr-22 1-Apr-22 In the Director's judgement, this milestone will not be met by 12 July 2024. Nil expense recorded. This tranche has vested in prior year, not exercised as a result of his resignation. This tranche have vested- in prior year, not exercised as a result of his resignation. 1-Jan-23 This was converted to shares at nil value during the year. 1-Jan-24 This has not vested as at his resignation. $71,823 expense recognised in prior year was unwinding. 22-Nov-23 $14,356 expenses was recognised 22-Nov-23 22-Aug-24 In the Directors judgement, this milestones will not be met by measurement date. In the Director's judgement, this milestone will not be met by 22 August 2024. 100 101 113113 Lake Resources NL Note to the consolidated financial statements 30 June 2023 19 Share-based payments (continued) (a) Expensed to Profit or Loss (continued) (iii) Performance shares issued to Directors and other Key Management Personnel (continued) Directors exercised judgement in assessing that the likelihood of the remaining hurdles for the vesting of the performance rights has materially changed since the prior year. Accordingly for the year ended 30 June 2023, $71,823 (2022: $373,750) was credited in the profit or loss unwinding prior expenses recognised. During the year $14,356 was recognised as expenses in the year, for performance shares issued during the year. The expense calculation recognises the probability of the performance hurdles being achieved. (iv) Restricted Stock Unit issued as part of employee benefit Restricted Stock Unit issued under employee award plan (expensed) Restricted Stock Unit issued under employee award plan (capitalized portion) 2023 $ 1,116,628 55,699 1,172,327 2022 $ - - - Refer to details of Restricted Stock Unit issued to Note 20. (b) Capitalised as equity transaction cost Shares under option granted to brokers and investor relations consultants in the prior period and continued to vest following these vesting conditions; (a) (b) (c) (d) Tranche 1 - 10 million options which vest on the date the Company achieves a 5-day VWAP prior to the Expiry Date of A$0.55 or above. Tranche 2 - 10 million options which vest on the date the Company achieves a 5-day VWAP prior to the Expiry Date of A$0.70 or above. Tranche 3 - 10 million options which vest on the date the Company achieves a 5-day VWAP prior to the Expiry Date of A$0.85 or above. Tranche 4 - 5 million options which vest on the date the Company achieves a 5-day VWAP prior to the Expiry Date of A$1.25 or above. Grant date Vesting date Share Price at grant date Exercise (Strike) Price Time to Maturity (in years) Annual Risk-Free Rate Annualised Volatility Tranche 1 Tranche 2 Tranche 3 Tranche 4 16-July-21 14-Mar-23 $0.385 $0.55 3 0.15% 109.817% 16-July-21 28-Sep-23 $0.385 $0.55 3 0.15% 109.817% 16-July-21 21-Jan-24 $0.385 $0.55 3 0.15% 109.817% 16-July-21 22-Jun-24 $0.385 $0.55 3 0.15% 109.817% 114 102 LAKE RESOURCES ANNUAL REPORT 2023 Lake Resources NL Note to the consolidated financial statements 30 June 2023 19 Share-based payments (continued) (b) Capitalised as equity transaction cost (continued) Canacord Tranch 1 Canacord Tranch 2 Canacord Tranch 3 Canacord Tranch 4 Total Grant date Expiry date 16-Jul-21 31-Dec-24 16-Jul-21 31-Dec-24 16-Jul-21 31-Dec-24 16-Jul-21 31-Dec-24 Exercise price $0.55 $0.55 $0.55 $0.55 Granted 10,000,000 10,000,000 10,000,000 5,000,000 35,000,000 Charged to Equity 1,014,528 1,093,107 968,375 413,686 3,489,696 20 Employee option and restricted stock unit plan The establishment of the Employee Award Scheme was approved by shareholders at the 2022 Annual General Meeting. The Employee Award Plan is designed to provide long-term incentives for senior managers and above (including executive directors) to deliver long-term shareholders returns. Under the plan, participants are granted options and restricted stock units which vest in 25% increments on each of the first four anniversaries of the commencement date, subject to the participant continuing an employee of Lake Resources through the applicable vesting date; where a change in control occurs while still employed by the company, any then un-vested RSU’s and options shall immediately vest. Options and Restricted Stock Unit granted under the plan are for no consideration and carry no dividend or voting rights. (a) Restricted stock units (RSU) Restricted Stock Unit granted under the plan for are no consideration and carry no dividend or voting rights. The terms and conditions of restricted stock units on issue at 30 June 2023 affecting remuneration of directors and other key management personnel in this financial period or reporting period are as follows: 103 115115 Lake Resources NL Note to the consolidated financial statements 30 June 2023 20 Employee option and restricted stock unit plan (continued) (a) Restricted stock units (RSU) (continued) Vesting date 15-Sep-23 15-Sep-24 15-Sep-25 15-Sep-26 11-Oct-23 11-Oct-24 11-Oct-25 11-Oct-26 10-Oct-23 10-Oct-24 10-Oct-25 10-Oct-26 1-Dec-23 2-Dec-23 14-Nov-23 14-Nov-24 14-Nov-25 14-Nov-26 4-Nov-23 4-Nov-24 4-Nov-25 4-Nov-26 1-Jan-24 1-Jan-25 1-Jan-26 1-Jan-27 11-Jan-24 11-Jan-25 11-Jan-26 11-Jan-27 16-Jan-24 16-Jan-25 16-Jan-26 16-Jan-27 1-Feb-24 1-Feb-25 1-Feb-26 1-Feb-27 1-April-24 1-April-25 1-April-26 1-April-27 20-Jun-24 20-Jun-25 20-Jun-26 20-Jun-27 Number of units allotted 250,000 250,000 250,000 250,000 25,000 25,000 25,000 25,000 37,500 37,500 37,500 37,500 232,500 232,500 18,750 18,750 18,750 18,750 12,500 12,500 12,500 12,500 354,338 115,838 115,838 115,838 18,750 18,750 18,750 18,750 12,500 12,500 12,500 12,500 220,474 220,474 220,474 220,474 37,500 37,500 37,500 37,500 110,294 110,294 110,294 110,294 4,139,924 Fair value price $0.930 $0.930 $0.930 $0.930 $0.990 $0.990 $0.990 $0.990 $0.990 $0.990 $0.990 $0.990 $1.005 $1.030 $1.180 $1.180 $1.180 $1.180 $1.070 $1.070 $1.070 $1.070 $0.800 $0.800 $0.800 $0.800 $0.840 $0.840 $0.840 $0.840 $0.825 $0.825 $0.825 $0.825 $0.815 $0.815 $0.815 $0.815 $0.445 $0.445 $0.445 $0.445 $0.305 $0.305 $0.305 $0.305 Valuation $ 232,500 232,500 232,500 232,500 24,750 24,750 24,750 24,750 37,125 37,125 37,125 37,125 233,663 239,475 22,125 22,125 22,125 22,125 13,375 13,375 13,375 13,375 283,470 92,670 92,670 92,670 15,656 15,656 15,656 15,656 10,313 10,313 10,313 10,313 179,686 179,686 179,686 179,686 16,688 16,688 16,688 16,688 33,640 33,640 33,640 33,640 3,378,048 104 Grant date 15-Sep-22 11-Oct-22 10-Oct-22 1-Dec-22 2-Dec-22 14-Nov-22 4-Nov-22 1-Jan-23 11-Jan-23 16-Jan-23 1-Feb-23 1-April-23 20-Jun-23 116 LAKE RESOURCES ANNUAL REPORT 2023 Lake Resources NL 30 June 2023 Note to the consolidated financial statements Lake Resources NL Note to the consolidated financial statements 30 June 2023 20 Employee option and restricted stock unit plan (continued) 20 Employee option and restricted stock unit plan (continued) (a) Restricted stock units (RSU) (continued) Grant date Vesting date Number of units allotted Fair value price Valuation $ 15-Sep-22 11-Oct-22 10-Oct-22 1-Dec-22 2-Dec-22 14-Nov-22 4-Nov-22 1-Jan-23 11-Jan-23 16-Jan-23 1-Feb-23 1-April-23 20-Jun-23 15-Sep-23 15-Sep-24 15-Sep-25 15-Sep-26 11-Oct-23 11-Oct-24 11-Oct-25 11-Oct-26 10-Oct-23 10-Oct-24 10-Oct-25 10-Oct-26 1-Dec-23 2-Dec-23 14-Nov-23 14-Nov-24 14-Nov-25 14-Nov-26 4-Nov-23 4-Nov-24 4-Nov-25 4-Nov-26 1-Jan-24 1-Jan-25 1-Jan-26 1-Jan-27 11-Jan-24 11-Jan-25 11-Jan-26 11-Jan-27 16-Jan-24 16-Jan-25 16-Jan-26 16-Jan-27 1-Feb-24 1-Feb-25 1-Feb-26 1-Feb-27 1-April-24 1-April-25 1-April-26 1-April-27 20-Jun-24 20-Jun-25 20-Jun-26 20-Jun-27 250,000 250,000 250,000 250,000 25,000 25,000 25,000 25,000 37,500 37,500 37,500 37,500 232,500 232,500 18,750 18,750 18,750 18,750 12,500 12,500 12,500 12,500 354,338 115,838 115,838 115,838 18,750 18,750 18,750 18,750 12,500 12,500 12,500 12,500 220,474 220,474 220,474 220,474 37,500 37,500 37,500 37,500 110,294 110,294 110,294 110,294 $0.930 $0.930 $0.930 $0.930 $0.990 $0.990 $0.990 $0.990 $0.990 $0.990 $0.990 $0.990 $1.005 $1.030 $1.180 $1.180 $1.180 $1.180 $1.070 $1.070 $1.070 $1.070 $0.800 $0.800 $0.800 $0.800 $0.840 $0.840 $0.840 $0.840 $0.825 $0.825 $0.825 $0.825 $0.815 $0.815 $0.815 $0.815 $0.445 $0.445 $0.445 $0.445 $0.305 $0.305 $0.305 $0.305 232,500 232,500 232,500 232,500 24,750 24,750 24,750 24,750 37,125 37,125 37,125 37,125 233,663 239,475 283,470 22,125 22,125 22,125 22,125 13,375 13,375 13,375 13,375 92,670 92,670 92,670 15,656 15,656 15,656 15,656 10,313 10,313 10,313 10,313 179,686 179,686 179,686 179,686 16,688 16,688 16,688 16,688 33,640 33,640 33,640 33,640 104 4,139,924 3,378,048 (a) Restricted stock units (RSU) (continued) Under the plan, participants are granted restricted stock units which vest in 25% increments on each of the first four anniversaries of the commencement date. Each 25% is treated as a separate award on the grounds that the different vesting periods will mean that the four tranches of the award have different fair values and are accounted for with graded vesting. These RSU's have been valued using the assumptions below: • • • The exercise price is based on fair value of share price at grant date; The restricted stock units have varying grant dates being the dates on which the employee commenced employment with the company. The share price at each grant date has been taken from the closing price on the ASX on the grant date or the previous trading day; and Any employees who cease employment prior to 100% of their rights vesting are subject to forfeit remaining unvested shares. Grant date 15-Sept-22 10-Oct-22 11-Oct-22 4-Nov-22 14-Nov-22 1-Dec-22 2-Dec-22 1-Jan-23 11-Jan-23 16-Jan-23 1-Feb-23 1-April-23 20-Jun-23 Number of RSUs granted Expiry date Exercise price Fair value at grant date Expensed $ 1,000,000 150,000 100,000 50,000 75,000 232,500 232,500 701,852 75,000 50,000 881,896 150,000 441,176 4,139,924 15-Sep-26 10-Oct-27 11-Oct-27 4-Nov-26 14-Nov-27 1-Dec-23 2-Dec-23 1-Jan-27 11-Jan-27 16-Jan-27 1-Feb-27 1-April-27 20-Jun-27 - - - - - - - - - - - - - $0.930 $0.995 $0.990 $1.070 $1.180 $1.030 $1.030 $0.800 $0.835 $0.825 $0.815 $0.445 $0.305 381,979 55,699 36,992 18,159 28,777 135,076 137,780 189,772 15,183 9,707 152,730 8,556 1,916 1,172,327 105 117117 Lake Resources NL Note to the consolidated financial statements 30 June 2023 20 Employee option and restricted stock unit plan (continued) (b) Options The terms and conditions of options on issue at 30 June 2023 affecting remuneration of Directors and other key management personnel (Note ) and employees in this financial period or reporting period are as follows: Grant date Number of options granted 20-Jul-22 22-Aug-22 15-Sept-22 10-Oct-22 11-Oct-22 14-Nov-22 21-Nov-22 1-Jan-23 9-Jan-23 11-Jan-23 16-Jan-23 1-Feb-23 1-April-23 16-Jun-23 1,000,000 1,000,000 4,000,000 500,000 300,000 75,000 50,000 851,700 1,000,000 75,000 100,000 1,145,689 150,000 882,353 11,129,742 Expiry date Exercise price $0.700 $1.500 $1.130 $0.995 $0.990 $1.175 $1.060 $0.800 $0.830 $0.835 $0.825 $0.815 $0.445 $0.460 20-Jul-25 22-Aug-25 15-Sep-27 10-Oct-27 11-Oct-27 14-Nov-27 21-Nov-27 1-Jan-28 9-Jan-28 11-Jan-28 16-Jan-28 1-Feb-28 1-April-28 16-Jun-28 Fair value Expensed $ $0.700 $1.500 $1.130 $0.995 $0.990 $1.175 $1.060 $0.800 $0.840 $0.835 $0.810 $0.815 $0.445 $0.460 467,117 775,093 1,184,388 147,659 87,893 22,654 13,198 137,785 160,113 11,941 15,252 155,394 6,586 6,387 3,191,460 Under the plan, participants are granted options which vest in 25% increments on each of the first four anniversaries of the commencement date. These options have been valued using both the Black-Scholes model with the following assumptions: • • The exercise price is based on fair value of share price at grant date; and The options have varying grant dates being the dates on which the employee commenced employment with the company. The share price at each grant date has been taken from the closing price on the ASX on the grant date or the previous trading day. Grant date Vesting Date Share Price at grant date Exercise (Strike) Price Time to Maturity (in years) Annual Risk-Free Rate Annualised Volatility 20-Jul-22 20-Jul-22 $0.700 $0.700 5 3.21% 108.18% 22-Aug-22 22-Aug-22 $1.210 $1.500 3 3.6% 109.949% 15-Sep-22 15-Sep-26 $0.925 $1.130 5 3.79% 109.949% 11-Oct-22 11-Oct-26 $0.990 $0.990 5 3.70% 107.70% 10-Oct-22 10-Oct-27 $0.995 $0.995 5 3.57% 107.70% 14-Nov-22 14-Nov-26 $1.175 $1.175 5 3.44% 107.7% In August 2022, prior to the establishment of immediately. the plan two participants were awarded options which vested 118 106 LAKE RESOURCES ANNUAL REPORT 2023 Lake Resources NL 30 June 2023 Note to the consolidated financial statements Lake Resources NL Note to the consolidated financial statements 30 June 2023 20 Employee option and restricted stock unit plan (continued) 20 Employee option and restricted stock unit plan (continued) (b) Options The terms and conditions of options on issue at 30 June 2023 affecting remuneration of Directors and other key management personnel (Note ) and employees in this financial period or reporting period are as follows: Grant date granted Expiry date Exercise price Fair value Expensed $ Number of options 20-Jul-22 22-Aug-22 15-Sept-22 10-Oct-22 11-Oct-22 14-Nov-22 21-Nov-22 1-Jan-23 9-Jan-23 11-Jan-23 16-Jan-23 1-Feb-23 1-April-23 16-Jun-23 1,000,000 1,000,000 4,000,000 500,000 300,000 75,000 50,000 851,700 1,000,000 75,000 100,000 1,145,689 150,000 882,353 11,129,742 20-Jul-25 22-Aug-25 15-Sep-27 10-Oct-27 11-Oct-27 14-Nov-27 21-Nov-27 1-Jan-28 9-Jan-28 11-Jan-28 16-Jan-28 1-Feb-28 1-April-28 16-Jun-28 $0.700 $1.500 $1.130 $0.995 $0.990 $1.175 $1.060 $0.800 $0.830 $0.835 $0.825 $0.815 $0.445 $0.460 $0.700 $1.500 $1.130 $0.995 $0.990 $1.175 $1.060 $0.800 $0.840 $0.835 $0.810 $0.815 $0.445 $0.460 467,117 775,093 1,184,388 147,659 87,893 22,654 13,198 137,785 160,113 11,941 15,252 155,394 6,586 6,387 3,191,460 Under the plan, participants are granted options which vest in 25% increments on each of the first four anniversaries of the commencement date. These options have been valued using both the Black-Scholes model with the following assumptions: • • The exercise price is based on fair value of share price at grant date; and The options have varying grant dates being the dates on which the employee commenced employment with the company. The share price at each grant date has been taken from the closing price on the ASX on the grant date or the previous trading day. Grant date Vesting Date Share Price at grant date Exercise (Strike) Price Time to Maturity (in years) Annual Risk-Free Rate Annualised Volatility 20-Jul-22 20-Jul-22 22-Aug-22 22-Aug-22 15-Sep-22 15-Sep-26 $0.700 $0.700 5 3.21% $1.210 $1.500 3 3.6% $0.925 $1.130 5 3.79% 108.18% 109.949% 109.949% 11-Oct-22 11-Oct-26 $0.990 $0.990 5 3.70% 107.70% 10-Oct-22 10-Oct-27 14-Nov-22 14-Nov-26 $0.995 $0.995 5 3.57% 107.70% $1.175 $1.175 5 3.44% 107.7% In August 2022, prior to the establishment of the plan two participants were awarded options which vested immediately. (b) Options (continued) Grant date Vesting Date Share Price at grant date Exercise (Strike) Price Time to Maturity (in years) Annual Risk-Free Rate Annualised Volatility 21-Nov-22 1-Jan-23 9-Jan-23 11-Jan-23 16-Jan-23 1-Feb-23 1-April-23 20-Jun-23 21-Nov-22 1-Jan-27 9-Jan-27 11-Jan-27 16-Jan-27 1-Feb-27 1-April-27 20-Jun-27 $0.305 $0.305 5 3.95% 107.7% 106.622% 106.622% 106.622% 106.622% 106.41% 103.16% 106.62% $0.800 $0.800 5 3.7% $0.830 $0.830 5 3.46% $0.815 $0.815 5 3.30% $0.835 $0.835 5 3.46% $0.445 $0.445 5 3.03% $1.060 $1.060 5 3.34% $0.825 $0.825 5 3.32% 21 Financial instruments Financial risk management objectives The Consolidated entity's activities expose it to a variety of financial risks: market risk (including foreign currency risk, price risk and interest rate risk), credit risk and liquidity risk. The Consolidated entity's overall risk management program focuses on the unpredictability of financial markets and seeks to minimise potential adverse effects on the financial performance of the Consolidated entity. The Consolidated entity uses different methods to measure different types of risk to which it is exposed. Risk management is carried out by the Board of Directors ('the Board'). These policies include identification and analysis of the risk exposure of the Consolidated entity and appropriate procedures, controls and risk limits. (a) Foreign currency risk The Consolidated entity undertakes 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. The Group use a legal trading mechanism commonly known as the Gain on Electronic Payment Market (MEP Dollar) in which the Argentinian subsidiary, Morena Del Valle SA and Minerales Australes SA buy Argentinian bonds in USD, and then sell the bonds, via local banking broker in Argentina, for Argentinian Peso on the same day. This is to enable the Group to fund working capital and exploration activities in its Argentinian operations. See Note 5 for further information. The carrying amount of the Consolidated entity's foreign currency denominated financial instruments at the reporting date were as follows, expressed in AUD. US Dollars Pound Sterling Canadian Dollars Argentina Pesos Total Assets 2023 $ 2022 $ Liabilities 2023 $ 2022 $ 15,846,866 - - 3,058,278 18,905,144 10,236,259 - - 578,239 10,814,498 1,625,224 48,712 - 1,293,078 2,967,014 266,365 95,397 37,017 2,294,900 2,693,679 106 107 119119 Lake Resources NL Note to the consolidated financial statements 30 June 2023 21 Financial instruments (continued) (a) Foreign currency risk (continued) A sensitivity analysis of the movement in exchange rate (based on the closing balance of the asset) is presented below: 2023 AUD strengthen by 1% AUD weaken by 1% Impact on Impact on Profit before tax Equity Profit before tax Equity $ $ $ $ (156,900) (16,091) (48,712) (12,803) (30,280) (264,786) (101,349) (2,637) (945) (367) (22,722) (5,725) (133,745) 257,803 (257,803) (161,651) (20) 20 (161,651) 38,031 (38,031) (25,772) (63,262) (11) 11 (89,034) 160,069 16,416 492 13,061 30,891 220,929 103,397 2,691 945 374 23,181 5,841 136,429 (252,698) 252,698 158,450 20 (20) 158,450 37,278 (37,278) 25,261 62,009 (11) 11 87,270 USD assets USD liabilities GBP liabilities ARS liabilities ARS assets Total 2022 USD assets USD liabilities GBP liabilities CAD liabilities ARS liabilities ARS assets Total (b) Price risk The Consolidated entity is not exposed to any significant price risk. Interest rate risk (c) Currently the Consolidated entity does not have any external borrowings subject to variable rates and therefore has minimal interest rate risk. (d) Credit risk Generally, other 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. 120 108 LAKE RESOURCES ANNUAL REPORT 2023 Lake Resources NL 30 June 2023 Note to the consolidated financial statements 21 Financial instruments (continued) (a) Foreign currency risk (continued) A sensitivity analysis of the movement in exchange rate (based on the closing balance of the asset) is presented below: 2023 USD assets USD liabilities GBP liabilities ARS liabilities ARS assets Total 2022 USD assets USD liabilities GBP liabilities CAD liabilities ARS liabilities ARS assets Total (b) Price risk AUD strengthen by 1% AUD weaken by 1% Impact on Impact on Profit before Profit before (264,786) (161,651) tax $ (156,900) (16,091) (48,712) (12,803) (30,280) (101,349) (2,637) (945) (367) (22,722) (5,725) (133,745) Equity $ 257,803 (257,803) (161,651) (20) 20 38,031 (38,031) (25,772) (63,262) (11) 11 (89,034) tax $ 160,069 16,416 492 13,061 30,891 220,929 103,397 2,691 945 374 23,181 5,841 136,429 Equity $ (252,698) 252,698 158,450 20 (20) 158,450 37,278 (37,278) 25,261 62,009 (11) 11 87,270 Currently the Consolidated entity does not have any external borrowings subject to variable rates and therefore has The Consolidated entity is not exposed to any significant price risk. (c) Interest rate risk minimal interest rate risk. (d) Credit risk Generally, other 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. Lake Resources NL Note to the consolidated financial statements 30 June 2023 21 Financial instruments (continued) (d) Credit risk (continued) The Consolidated entity deemed its credit risk to be minimal as its financial assets are mainly cash held at financial institutions with credit risk ratings of Aa3 (Moody’s) and AA- (Standard and Poors). The maximum exposure to credit risk at the reporting date to recognised financial assets is the carrying amount, net of any provisions for impairment of those assets, as disclosed in the statement of financial position and notes to the financial statements. The consolidated entity does not hold any collateral. (e) Liquidity risk Vigilant liquidity risk management requires the consolidated entity to maintain sufficient liquid assets (mainly cash and cash equivalents) and available liabilities to be able to pay debts as and when they become due and payable. The Consolidated entity manages 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 entity only deposit its cash and cash equivalent with the major banks in Australia. (i) Remaining contractual maturities The following tables detail 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. the Consolidated entity's remaining contractual maturity for its financial Contractual maturities of financial liabilities Weighted average interest rate <1 year 1 - 2 years 2 - 5 years 30 June 2023 % $ $ Remaining contractual maturities $ > 5 years $ $ Non-derivatives Trade and Other payables Lease liabilities Total non-derivatives 30 June 2022 Non-derivatives Trade and Other payables Lease liabilities Total non-derivatives -10,773,518 348,354 - -11,121,872 - - - 1,315,787 - 1,315,787 - 4,515,149 - 80,235 - 4,595,384 - - - - 197,622 197,622 - - - - - - 10,773,518 1,664,141 12,437,659 4,515,149 277,857 4,793,006 The cash flows in the maturity analysis above are not expected to occur significantly earlier than contractually disclosed above. Fair value of financial instruments Unless otherwise stated, the carrying amounts of financial instruments reflect their fair value. 108 109 121121 Lake Resources NL Note to the consolidated financial statements 30 June 2023 22 Key management personnel disclosures Directors fees and/or salary Consulting fees Annual leave Other benefits - relocation cost Short-term benefits Total Short-term Benefits Post-employment benefits (superannuation) Long service leave Share-based payments Total Long-term Benefits Total Remuneration 23 Remuneration of auditors 2023 $ 2022 $ 3,223,029 142,312 242,170 - 679,292 4,286,803 102,778 2,185 1,862,016 1,966,979 1,626,099 391,453 232,543 100,000 - 2,350,095 87,135 18,158 1,739,173 1,844,466 6,253,782 4,194,561 During the financial year the following fees were paid or payable for services provided by BDO Audit Pty Ltd, the auditor of the Consolidated entity. (a) Audit services Audit and review of financial statements BDO Audit Pty Ltd Other services Tax compliance services 2023 $ 2022 $ 603,677 489,960 112,670 55,288 (b) Non-audit services BDO provided non-audit services of $112,670 (2022: $55,288) during the financial year ended 30 June 2023. The the provision of non-audit services is compatible with the general standard of Directors are satisfied that independence for auditors imposed by the Corporations Act 2001. The Directors are satisfied that the provision of non-audit services did not compromise the auditor independence requirements of the Corporations Act 2001 because none of the services undermine the general principles relating to auditor independence as set out in APES 110 Code of Ethics for Professional Accountants. 122 110 LAKE RESOURCES ANNUAL REPORT 2023 Lake Resources NL 30 June 2023 Note to the consolidated financial statements 22 Key management personnel disclosures Directors fees and/or salary Consulting fees Annual leave Other benefits - relocation cost Short-term benefits Total Short-term Benefits Long service leave Share-based payments Total Long-term Benefits Total Remuneration Post-employment benefits (superannuation) 23 Remuneration of auditors auditor of the Consolidated entity. (a) Audit services Audit and review of financial statements BDO Audit Pty Ltd Other services Tax compliance services (b) Non-audit services During the financial year the following fees were paid or payable for services provided by BDO Audit Pty Ltd, the 2023 $ 2022 $ 3,223,029 142,312 242,170 - 679,292 4,286,803 102,778 2,185 1,862,016 1,966,979 1,626,099 391,453 232,543 100,000 - 2,350,095 87,135 18,158 1,739,173 1,844,466 6,253,782 4,194,561 2023 $ 2022 $ 603,677 489,960 112,670 55,288 110 Lake Resources NL Note to the consolidated financial statements 30 June 2023 24 Related party transactions (a) Parent entities Lake Resources NL is the parent entity. (b) Subsidiaries Interests in subsidiaries are set out in Note 27. (c) Key management personnel Disclosures relating to key management personnel are set out in Note 22 and the remuneration report included in the Directors' report. (d) Transactions with other related parties The following transactions occurred with related parties: Payment for services Consultancy services provided by companies associated with Mr. Stuart Crow (Director) Consultancy services provided by a Consolidated entity associated with Mr. Nicholas Lindsay (Director) Consultancy services provided by former CFO Garry Gill (Executive) Consultancy services provided by an entity associated with Amalia Saenz (Director resigned 1 Feb 2023) Receivable from and (payable to) related parties Net advances to Mr Stephen Promnitz (e) Terms and conditions Disclosures relating to the advance to Mr Promnitz: 2023 $ 2022 $ - - - 142,312 142,312 96,600 186,593 108,260 - 391,453 200,000 1,077,773 BDO provided non-audit services of $112,670 (2022: $55,288) during the financial year ended 30 June 2023. The Directors are satisfied that the provision of non-audit services is compatible with the general standard of independence for auditors imposed by the Corporations Act 2001. The Directors are satisfied that the provision of non-audit services did not compromise the auditor independence requirements of the Corporations Act 2001 because none of the services undermine the general principles relating to auditor independence as set out in APES 110 Code of Ethics for Professional Accountants. • • • The outstanding balance at 30 June 2023 was $200,000 (2022: $1,077,773); The terms and conditions at 30 June 2023 of the advances are unsecured and has no personal guarantees; No provision for credit loss been recognised. 111 123123 Lake Resources NL Note to the consolidated financial statements 30 June 2023 25 Parent entity financial information (a) Summary financial information Statement of financial position Current assets Total assets Current liabilities Total liabilities Shareholders' equity Issued capital Reserves Options reserve Capital profits reserve Performance rights reserve Employee Award Program reserve( Restricted Stock Units) Accumulated losses Profit or loss for the year Total comprehensive income 2023 $ 2022 $ 167,445,592 180,408,601 4,157,106 4,158,600 (339,538,487) 197,851,828 219,285,920 1,812,505 1,816,713 (413,508,530) 229,703,797 231,179,318 20,876,359 4,997 912,663 1,172,327 (76,420,142) 8,068,140 4,997 970,130 - (22,753,377) 176,250,001 217,469,208 2023 $ (53,666,765) 2022 $ (8,712,948) (53,666,765) (8,712,948) (b) Guarantees entered into by the parent entity in relation to the debts of its subsidiaries The parent entity had no guarantees in relation to the debts of its subsidiaries as at 30 June 2023 and 30 June 2022. (c) Contingent liabilities The parent entity had no contingent liabilities as at 30 June 2023 and 30 June 2022. (d) Capital commitments - Property, plant and equipment The parent entity had no capital commitments for property, plant and equipment as at 30 June 2023 and 30 June 2022. (e) Significant accounting policies The accounting policies of the parent entity are consistent with those of the Consolidated entity, as disclosed in note 1, except for the following: • • • Investments in subsidiaries are accounted for at cost, less any impairment, in the parent entity; Investments in associates are accounted for at cost, less any impairment, in the parent entity; and Dividends received from subsidiaries are recognised as other income by the parent entity. 124 112 LAKE RESOURCES ANNUAL REPORT 2023 Lake Resources NL 30 June 2023 Note to the consolidated financial statements 25 Parent entity financial information (a) Summary financial information Statement of financial position Current assets Total assets Current liabilities Total liabilities Shareholders' equity Issued capital Reserves Options reserve Capital profits reserve Performance rights reserve Profit or loss for the year Total comprehensive income Employee Award Program reserve( Restricted Stock Units) Accumulated losses (b) Guarantees entered into by the parent entity in relation to the debts of its subsidiaries The parent entity had no guarantees in relation to the debts of its subsidiaries as at 30 June 2023 and 30 June 2022. (c) Contingent liabilities The parent entity had no contingent liabilities as at 30 June 2023 and 30 June 2022. (d) Capital commitments - Property, plant and equipment The parent entity had no capital commitments for property, plant and equipment as at 30 June 2023 and 30 June 2022. (e) Significant accounting policies 1, except for the following: The accounting policies of the parent entity are consistent with those of the Consolidated entity, as disclosed in note • • • Investments in subsidiaries are accounted for at cost, less any impairment, in the parent entity; Investments in associates are accounted for at cost, less any impairment, in the parent entity; and Dividends received from subsidiaries are recognised as other income by the parent entity. 2023 $ 2022 $ 167,445,592 180,408,601 4,157,106 4,158,600 197,851,828 219,285,920 1,812,505 1,816,713 (339,538,487) (413,508,530) 229,703,797 231,179,318 20,876,359 4,997 912,663 1,172,327 8,068,140 4,997 970,130 - (76,420,142) (22,753,377) 176,250,001 217,469,208 2023 $ 2022 $ (53,666,765) (8,712,948) (53,666,765) (8,712,948) 112 Lake Resources NL Note to the consolidated financial statements 30 June 2023 26 Non-controlling interests 2023 $ 2022 $ 5,075,005 - Proportion of ownership interest and voting rights held by the NCI Total comprehensive income allocated to NCI Accumulated NCI 30 June 2023 30 June 2022 30 June 2023 30 June 2022 30 June 2023 30 June 2022 20% - (3,389,129) - 5,075,005 - Interest in: Reserves Name Kachi Lithium Pty Ltd On 22 September 2021, Lake Resources NL and Lilac Solutions, Inc. entered a partnership for technology and funding to develop Lake’s Kachi Lithium Brine Project (Kachi) in Argentina. Under the terms of the partnership earn-in, Lilac can achieve an equity stake in the Kachi project with certain corresponding project funding obligations, while providing its leading technology to advance the project. During the period, Lilac Solution Kachi, LLC earned 10% interest in Kachi Lithium Pty Ltd upon commitment to provide funds. On 17 April 2023, Lilac Solutions, Inc. earned additional 10% interest in Kachi Lithium Pty upon completion of a key milestone relating to Lilac test work on-site. Details of the relevant phases and KPI as detailed below and this entitles Lilac Solution to Class B shares. 113 125125 Lake Resources NL Note to the consolidated financial statements 30 June 2023 26 Non-controlling interests (continued) Details of the key milestones are highlighted below: KPI Phase 1 will commence on the "Effective Date" under the Shareholders Agreement and end the day prior to the day on which Phase 2 commences The Oakland Chloride Product will be a “Lithium in each case as Carbonate Feed,” meaning that, reported by Lilac and confirmed via sample analysis by SGS S.A., ALS Limited, or a similar high quality Third Party analytical lab selected by Lilac (an “Independent Lab”), it will have: 1. lithium content above 1 g/L; calcium, and 2. sodium, magnesium, potassium (“Other Metal Cations”) content less than 3x higher than lithium content (e.g., if lithium at 2 g/L, total Other Metal Cations must be less than 6 g/L); and 3. iron and boron content each less than 1/10th the lithium content (e.g. if lithium at 2 g/L, iron and boron must each be below 0.2 g/L). total An Oakland Pilot Work test must demonstrate, in each case as reported by Lilac and confirmed via sample analysis by an Independent Lab: 1. lithium recovery above 80% for a brine containing at least 250 mg_Li/L (if test is done on a brine provided by Lake with less than 250 mg_Li/L, the required lithium recovery for this KPI shall be reduced by 0.5% for every 1 mg_Li/L below 250 mg_Li/L of the brine); and 2. production of a lithium chloride solution that is a Lithium Carbonate Feed, as defined in the specifications in 1 above. 1. Lilac completes at least 1,000 hours of operations (including uptime, maintenance, monitoring, and other work that constitutes operations as determined by Lilac in its reasonable discretion) of the Lilac Pilot Unit onsite at Kachi provided, however that this will be deemed achieved if Lake fails to facilitate operation of the Pilot Unit pursuant to clause 8.4; and 2. produces a Lithium Carbonate Feed (as defined in the specifications in KPI 1 above) totalling at least 2,500 kg of lithium carbonate equivalents from onsite operations (storage of this product will be Lake’s sole responsibility and at Lake's sole cost). Phase 3 will commence on the date on which the Class B Shareholder satisfies the Phase 3 ( obtain Tier 1 Product Qualification) and ends on the date of conversion of the Class A Shares into Class A-1 Shares Event Commitment fund 1 to provide Preparation of the Oakland Chloride Product 2 Lilac Test-Work in Oakland to Support DFS Lilac Test-Work On-Site 3 Product Qualification 126 Status Achieved earned 10% stake in Kachi Lithium Pty Ltd commitment to provide fund 10 2023, January On Lake announced that Lilac has successfully operated the Demonstration Plant for and 1,000 consecutive produced 40,000 litres of lithium chloride before 31 December 2022, therefore has met all key testing milestones in accordance with agreed timeline. hours The lithium chloride eluate produced by Lilac is in the process of being shipped to Saltworks and converted to lithium carbonate, after which it will be independently tested for purity. Testing results are expected Mid March which may offer a 5% stake in Kachi Lithium Pty Ltd if successful. Last 10% milestone is earned upon completion of 2500 kg LCE in full lithium carbonate equivalent. This was successfully achieved and announced on 17 April 2023. In progress 114 LAKE RESOURCES ANNUAL REPORT 2023 Lake Resources NL 30 June 2023 Note to the consolidated financial statements 26 Non-controlling interests (continued) Details of the key milestones are highlighted below: Preparation of the “Independent Lab”), it will have: Oakland Chloride Product 1. lithium content above 1 g/L; to the day on which Phase 2 commences fund The Oakland Chloride Product will be a “Lithium Carbonate Feed,” meaning that, in each case as reported by Lilac and confirmed via sample analysis by SGS S.A., ALS Limited, or a similar high quality Third Party analytical lab selected by Lilac (an 2. total sodium, magnesium, calcium, and potassium (“Other Metal Cations”) content less than 3x higher than lithium content (e.g., if lithium at 2 g/L, total Other Metal Cations must be less than 6 g/L); and 3. iron and boron content each less than 1/10th the lithium content (e.g. if lithium at 2 g/L, iron and boron must each be below 0.2 g/L). An Oakland Pilot Work test must demonstrate, in therefore has met all key testing each case as reported by Lilac and confirmed via milestones in accordance with agreed sample analysis by an Independent Lab: timeline. 1. lithium recovery above 80% for a brine containing at least 250 mg_Li/L (if test is done on The lithium chloride eluate produced a brine provided by Lake with less than 250 by Lilac is in the process of being mg_Li/L, the required lithium recovery for this KPI shipped to Saltworks and converted Lilac Test-Work in shall be reduced by 0.5% for every 1 mg_Li/L to lithium carbonate, after which it will 2 Oakland to Support DFS below 250 mg_Li/L of the brine); and 2. production of a lithium chloride solution that is a Lithium Carbonate Feed, as defined in the specifications in 1 above. be independently tested for purity. Testing results are expected Mid March which may offer a 5% stake in Kachi Lithium Pty Ltd if successful. 1. Lilac completes at least 1,000 hours of operations Last 10% milestone is earned upon (including uptime, maintenance, monitoring, and completion of 2500 kg LCE in full other work that constitutes operations as determined lithium carbonate equivalent. This was by Lilac in its reasonable discretion) of the Lilac Pilot successfully achieved and announced Unit onsite at Kachi provided, however that this will on 17 April 2023. be deemed achieved if Lake fails to facilitate Lilac Test-Work On-Site operation of the Pilot Unit pursuant to clause 8.4; and 2. produces a Lithium Carbonate Feed (as defined in the specifications in KPI 1 above) totalling at least 2,500 kg of lithium carbonate equivalents from onsite operations (storage of this product will be Lake’s sole responsibility and at Lake's sole cost). Phase 3 will commence on the date on which the Class B Shareholder satisfies the Phase 3 ( obtain conversion of the Class A Shares into Class A-1 Shares 3 Product Qualification Tier 1 Product Qualification) and ends on the date of In progress 114 1 Commitment to provide Phase 1 will commence on the "Effective Date" under Achieved earned 10% stake in Kachi the Shareholders Agreement and end the day prior Lithium Pty Ltd commitment to provide KPI Status Event fund Summarised financial information for Kachi Lithium Pty Ltd, before intra-group eliminations, is set out below: 2023 $ 2022 $ Lake Resources NL Note to the consolidated financial statements 30 June 2023 26 Non-controlling interests (continued) Current asset Non-current assets Total assets Current liabilities Non-current liabilities Total liabilities On 10 January 2023, Lake announced that Lilac has successfully operated the Demonstration Plant for 1,000 consecutive hours and produced 40,000 litres of lithium chloride before 31 December 2022, Equity attributable to owners of the parent Non-controlling interest ccc Profit for the year attributable to owners of the parent Loss for the year attributable to NCI Profit for the year 7,995,496 114,597,171 122,592,667 71,875,092 151,461 72,026,553 50,566,113 6,965,205 1,044,655 (1,498,928) (454,273) Total comprehensive income for the year attributable to the owners of the parent Total comprehensive income for the year attributable to NCI Profit for the year (8,340,036) (3,389,129) (11,729,165) - - - - - - - - - - - - - - 115 127127 Lake Resources NL Note to the consolidated financial statements 30 June 2023 27 Interests in subsidiaries The consolidated financial statements incorporate the assets, liabilities and results of the following subsidiaries in accordance with the accounting policy described in note 1: Name of entity Principal place of business/ Country of incorporation Ownership interest held by the group Lith NRG Pty Ltd Minerales Australes SA Morena del Valle Minerals SA* Lake Resources CRN Pty Ltd Kachi Lithium Pty Ltd* Lake Corporate FL LLC** Lake Corporate Inc** Australia Argentina Argentina Australia Australia USA USA 2023 % 100 100 80 100 80 100 100 2022 % 100 100 100 100 100 - - Ownership interest held by non-controlling interests 2023 % 2022 % - - 20 - 20 - - - - - - - - - * ** Refer to Note26 for details on the non-controlling interest on Kachi Lithium Pty Ltd which owns Morena del Valle Minerals SA Lake Corporate FL LLC and Lake Corporate Inc. were incorporated on 31 August 2022 as a wholly owned subsidiaries of Lake Resources NL. Kachi Lithium Pty Ltd (KLPL) was incorporated on 26 August 2021 as a wholly owned subsidiary of Lith NRG 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 Solutions Inc, that company has the ability to earn up to 25% of the ownership of KLPL. 28 Events after the reporting period No other matter or circumstance has arisen since 30 June 2023 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. 128 116 LAKE RESOURCES ANNUAL REPORT 2023 Lake Resources NL 30 June 2023 Note to the consolidated financial statements 27 Interests in subsidiaries accordance with the accounting policy described in note 1: Name of entity Country of incorporation held by the group interests Principal place of business/ Ownership interest by non-controlling Ownership interest held 2023 % 2022 % 20 20 - - - - - - - - - - - - 2023 % 100 100 80 100 80 100 100 2022 % 100 100 100 100 100 - - Lith NRG Pty Ltd Minerales Australes SA Morena del Valle Minerals SA* Lake Resources CRN Pty Ltd Kachi Lithium Pty Ltd* Lake Corporate FL LLC** Lake Corporate Inc** * ** Valle Minerals SA Australia Argentina Argentina Australia Australia USA USA Refer to Note26 for details on the non-controlling interest on Kachi Lithium Pty Ltd which owns Morena del Lake Corporate FL LLC and Lake Corporate Inc. were incorporated on 31 August 2022 as a wholly owned subsidiaries of Lake Resources NL. Kachi Lithium Pty Ltd (KLPL) was incorporated on 26 August 2021 as a wholly owned subsidiary of Lith NRG 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 Solutions Inc, that company has the ability to earn up to 25% of the ownership of KLPL. 28 Events after the reporting period No other matter or circumstance has arisen since 30 June 2023 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. The consolidated financial statements incorporate the assets, liabilities and results of the following subsidiaries in (a) Reconciliation of loss after income tax to net cash used in operating activities Lake Resources NL Note to the consolidated financial statements 30 June 2023 29 Cash flow information Loss for the year Adjustments for: Depreciation and amortisation Share-based payments (non cash) Net proceeds from foreign exchange Impairment of assets Remeasurement of other financial asset Unrealized gain or loss Realized gain or loss Change in operating assets and liabilities: (Increase)/decrease in trade and other receivables Increase/(decrease) in operating accruals Increase in other current assets Increase/(decrease) in trade and other payables Increase in employee benefits Net cash outflow from operating activities Note 2023 $ 2022 $ (47,253,042) (5,683,093) 207,433 13,018,996 (43,696,631) 1,929,446 10,661,443 25,071,320 506,379 2,309,343 - (1,134,068) 6,732,672 3,912,341 (27,734,368) 51,297 2,425,591 (9,356,830) - - 6,923,565 22,620 (6,323,722) (91,732) (119,271) 2,613,462 - (9,538,113) (b) Non-cash investing and financing activities (i) During the year the Group entered into the following non-cash investing and financing transactions Share issue costs - to brokers Proceeds from issue of shares, net of transaction costs 2023 $ 2022 $ (3,489,696) (3,489,696) (9,711,684) (9,711,684) 116 117 129129 Lake Resources NL Note to the consolidated financial statements 30 June 2023 29 Cash flow information (continued) (b) Non-cash investing and financing activities (continued) (ii) Reconciliation of net debt Opening balance Repayments - cash Lease liability on inception Interest and finance cost Closing balance 30 Commitments 2023 $ 277,857 (244,767) 1,456,920 182,834 1,672,844 2022 $ - (19,441) 289,208 8,090 277,857 (a) Tenement Expenditure Commitments The Consolidated entity has no annual spending commitments required by Government or other bodies in order to maintain the standing of our Argentinian tenements. However, the Group is required to pay annual mining fees to keep the tenement rights in good standing, the approximate annual cost is AUD$103,000. 31 Contingencies The Consolidated entity had no contingent liabilities at 30 June 2023 (2022: nil). 130 118 LAKE RESOURCES ANNUAL REPORT 2023 Lake Resources NL 30 June 2023 Note to the consolidated financial statements 29 Cash flow information (continued) (b) Non-cash investing and financing activities (continued) (ii) Reconciliation of net debt Opening balance Repayments - cash Lease liability on inception Interest and finance cost Closing balance 30 Commitments 2023 $ 277,857 (244,767) 1,456,920 182,834 1,672,844 2022 $ - (19,441) 289,208 8,090 277,857 Lake Resources NL Directors' declaration 30 June 2023 In the Directors' opinion: (a) the consolidated financial statements and notes set out on pages 72 to 130 are in accordance with the Corporations Act 2001, including: (i) (ii) complying with Accounting Standards, the Corporations Regulations 2001 and other mandatory professional reporting requirements, and giving a true and fair view of the consolidated entity's financial position as at 30 June 2023 and of its performance for the financial year ended on that date, and (b) there are reasonable grounds to believe that the company will be able to pay its debts as and when they become due and payable. The Directors have been given the declarations by the Chief Executive Officer and Chief Financial Officer required by section 295A of the Corporations Act 2001. This declaration is made in accordance with a resolution of the Directors. (a) Tenement Expenditure Commitments The Consolidated entity has no annual spending commitments required by Government or other bodies in order to maintain the standing of our Argentinian tenements. However, the Group is required to pay annual mining fees to keep the tenement rights in good standing, the approximate annual cost is AUD$103,000. 31 Contingencies The Consolidated entity had no contingent liabilities at 30 June 2023 (2022: nil). S. Crow Director 28 September 2023 118 131131 Lake Resources NL Independent auditor's report to the members 30 June 2023 Tel: +61 7 3237 5999 Fax: +61 7 3221 9227 www.bdo.com.au Level 10, 12 Creek Street Brisbane QLD 4000 GPO Box 457 Brisbane QLD 4001 Australia INDEPENDENT AUDITOR'S REPORT Independent auditor's report to the members of To the members of Lake Resources NL Lake Resources NL Report on the Audit of the Financial Report Opinion We have audited the financial report of Lake Resource NL (the Company) and its subsidiaries (the Group), which comprises the consolidated statement of financial position as at 30 June 2023, 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) (ii) Giving a true and fair view of the Group’s financial position as at 30 June 2023 and of its financial performance for the year ended on that date; and {The Auditor's report will be provided by your Auditor.} 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. 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. 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. 120 132 LAKE RESOURCES ANNUAL REPORT 2023 Lake Resources NL Independent auditor's report to the members 30 June 2023 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 Our procedures included, but were not limited to the carries exploration and evaluation assets as at 30 June following: 2023 in accordance with the Group’s accounting policy for exploration and evaluation assets. • Obtaining an understanding of the current status of the tenements/projects including key The recoverability of exploration and evaluation assets activities undertaken during the period; is a key audit matter due to the significance of the • Making enquiries of management with respect to total balance and the level of procedures undertaken whether any impairment indicators in to evaluate management’s application of the accordance with AASB 6 have been identified requirements of AASB 6 Exploration for and Evaluation {The Auditor's report will be provided by your Auditor.} across the Group’s exploration project; of Mineral Resources (‘AASB 6’) in light of any • Assessing management’s determination that indicators of impairment that may be present. 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. 121 133133 Lake Resources NL Independent auditor's report to the members 30 June 2023 Accounting for Electronic Payment Market contract (MEP Dollar) Key audit matter Independent auditor's report to the members of How the matter was addressed in our audit Lake Resources NL Refer to Note 5(h) of the financial report for other income from gains on MEP Dollar trades, and related disclosures. For the year ended 30 June 2023, the Group recognised $43,696,631 of other income from gains on MEP Dollar trades, representing 94% of the Group’s total other income. Due to the quantum of the amount involved, we consider this to be a key audit matter. Our procedures included, but were not limited to the following: • • • Review the terms and conditions of the MEP arrangements; Reviewed the Group’s processes for recognising other income and controls in place around MEP Dollar trading; Reviewed the accounting treatment including the classification of gains and losses and cash flows presented in the financial statements, and the notes explaining the nature of these transactions; • Obtained and reperformed the other income calculations in relation to the gains on MEP {The Auditor's report will be provided by your Auditor.} Dollar trades; • • Agreed, on a sample basis, transactions during the year to underlying external supporting documents; Reviewed the adequacy of the disclosures in relation to other income set out in note 5(h) to the financial report. Other 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 2023, 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. 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. 120 134 LAKE RESOURCES ANNUAL REPORT 2023 Lake Resources NL Independent auditor's report to the members 30 June 2023 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. {The Auditor's report will be provided by your Auditor.} 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. Report on the Remuneration Report Opinion on the Remuneration Report We have audited the Remuneration Report included in pages 31 to 67 of the directors’ report for the year ended 30 June 2023. In our opinion, the Remuneration Report of Lake Resources NL, for the year ended 30 June 2023, 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, 28 September 2023 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. 121 135135 2023 Corporate Governance Statement This corporate governance statement sets out the corporate governance policies and practices in place throughout the reporting period and/or which are current in accordance with 4th edition of the ASX Principles of Good Corporate Governance and Best Practice Recommendations. This corporate governance statement is current as at 29 September 2023 and has been approved by the Board. It is available on the Company’s website at www.lakeresources.com.au. ASX Principles and Recommendations 1. Lay solid foundations for management and oversight 1.1. A listed entity should have and disclose a board charter setting out: Yes Comply (Yes/No) Explanation respective the (a) responsibilities of management; and roles and its board and The Company has adopted a Board Charter which sets out the roles and responsibilities of the Board, the Chairman, senior management (including the Managing Director and Chief Executive officer), and the Company Secretary. The Board Charter also sets out the matters expressly reserved to the Board and those delegated to management. those matters (b) expressly reserved to the board and those delegated to management. The Board is responsible for the performance and overall corporate governance of the Company including the strategic direction, selection of executive directors, establishing goals for management and monitoring the achievement of those goals and approval of budgets. Day to day management of the Company’s affairs and implementation of the corporate strategy are delegated by the Board to the Managing Director and Chief Executive Officer and senior management; however, the Board continues to be responsible for ensuring that management’s objective and activities are aligned with the Company’s values and risk appetite, as set by the Board from time to time. A copy of the Board Charter is available in the ‘Corporate Governance’ at http://www.lakeresources.com.au. the Company’s website section of 136 122 LAKE RESOURCES ANNUAL REPORT 2023 2023 Corporate Governance Statement 2023 Corporate Governance Statement (continued) This corporate governance statement sets out the corporate governance policies and practices in place throughout the reporting period and/or which are current in accordance with 4th edition of the ASX Principles of Good Corporate Governance and Best Practice Recommendations. This corporate governance statement is current as at 29 September 2023 and has been approved by the Board. It is available on the Company’s website at www.lakeresources.com.au. ASX Principles and Recommendations (Yes/No) Explanation 1. Lay solid foundations for management and oversight 1.1. A listed entity should have and Yes disclose a board charter setting out: Comply (a) the respective roles and responsibilities of its board and management; and (b) those matters expressly reserved to the board and those delegated to management. The Company has adopted a Board Charter which sets out the roles and responsibilities of the Board, the Chairman, senior management (including the Managing Director and Chief Executive officer), and the Company Secretary. The Board Charter also sets out the matters expressly reserved to the Board and those delegated to management. The Board is responsible for the performance and overall corporate governance of the Company including the strategic direction, selection of executive directors, establishing goals for management and monitoring the achievement of those goals and approval of budgets. Day to day management of the Company’s affairs and implementation of the corporate strategy are delegated by the Board to the Managing Director and Chief Executive Officer and senior management; however, the Board continues to be responsible for ensuring that management’s objective and activities are aligned with the Company’s values and risk appetite, as set by the Board from time to time. A copy of the Board Charter is available in the ‘Corporate Governance’ section of the Company’s website at http://www.lakeresources.com.au. ASX Principles and Recommendations 1. Lay solid foundations for management and oversight 1.2. A listed entity should: Yes Comply (Yes/No) Explanation (a) undertake appropriate checks before appointing a director or senior executive or putting someone forward for election as a director; and (b) provide security holders with all in material its information to a decision possession relevant on whether or not to elect or re- elect a director. 1.3. A listed entity should have a written agreement with each director and senior executive setting out the terms of their appointment. Yes 1.4. The company secretary of a listed accountable entity should directly to the board, through the chair, on all matters to do with the proper functioning of the board. be Yes things, checks The Board has constituted a Nomination and Governance Committee to support and advise the Board in, amongst before undertaking appropriate other appointing a candidate as a director or a senior executive, or putting forward to security holders a candidate for election as including checks in respect of character, a director, experience, education, criminal record and bankruptcy history. The Nomination and Governance Committee is also responsible for ensuring the Board has an appropriate mix of skills and experience to be an effective decision-making body, and that the Board is comprised of directors who contribute to the successful management of the Company and discharge their duties having regard to the law and the highest standards of corporate governance. The Nomination and Governance Committee is also responsible for ensuring all material information relevant to a decision on whether or not to elect or re-elect a director is provided to security holders. Therefore, the Notice of Meeting each year dispatched to all shareholders prior for the AGM includes all such material information obtained by the Company to enable shareholders to make an informed decision in respect of the re-election of directors at the AGM. A copy of the Nomination and Governance Committee Charter is available in the ‘Corporate Governance’ section of the Company’s website at http://www.lakeresources.com.au. The Nomination and Governance Committee is responsible for ensuring that each director and senior executive is a party to a written agreement with the Company which sets out the terms of that director’s or senior executive’s appointment. Therefore, the Company has written agreements in place with all directors and senior executives setting out the terms of their appointment. The Board Charter provides for the Company Secretary to be accountable directly to the Board through the Chair, on all matters to do with the proper functioning of the Board. 122 123 137137 2023 Corporate Governance Statement (continued) ASX Principles and Recommendations 1. Lay solid foundations for management and oversight (Continued) 1.5. A listed entity should: No Comply (Yes/No) Explanation The Company has adopted a Diversity Policy which is available in the ‘Corporate Governance’ section of the Company's website at http://www.lakeresources.com.au. In this reporting period, the Group has successfully increased its gender diversity compared to the last reporting period. The Company currently has two female board members (2022:1) representing 33% of the Board and (2022: Nil) representing 37.5% of senior executives. The Company currently has 56 female employees representing 33.1% of the total number of employees. executives female senior three the Company, The Board notes that it has made substantial progress over the last year to actively manage diversity as a means of enhancing the Company’s performance by recognising and utilising the contribution of diverse skills and talent from its directors, senior management, and employees. While the Board remains committed to the goal of gender levels, given the size and stage of diversity at all it has not yet set development of “measurable objectives” for achieving gender diversity in the composition of its board, senior executive or workforce generally. However, the Board will continually monitor this position pursuant to the Company’s Diversity Policy, and implement measurable objectives as and when it will deems the Company to require them. The future implementation of any measurable objectives will be disclosed to shareholders via the Company’s website and outcomes following the implementation of measurable objectives will be disclosed in its annual report. (a) Have and disclose a diversity policy; board (b) through its board or a committee of set measurable the for achieving gender objectives its diversity in the composition of board, and senior workforce generally; and executive (c) disclose in relation to each reporting period: (1) the measurable objectives set for that period to achieve gender diversity (2) the entity’s progress towards achieving those objectives; and (3) either: (A) the respective proportions of men and women on the board, in senior executive positions and the whole workforce across (including how the entity has defined “senior executive” for these purposes); or if the entity is a “relevant (B) employer” under the Workplace Gender Equality Act, the entity’s most “Gender Equity Indicators”, as defined in and published under that Act. recent period, reporting If the entity was in the S & P/ASX 300 index at the commencement of the the measurable objective for achieving gender diversity in the composition of its board should be to have not less than 30% of its directors of each gender within a specified period. 138 124 LAKE RESOURCES ANNUAL REPORT 2023 2023 Corporate Governance Statement (continued) ASX Principles and Recommendations (Yes/No) Explanation 1. Lay solid foundations for management and oversight (Continued) 1.5. A listed entity should: No Comply (a) Have and disclose a diversity policy; (b) through its board or a committee of the board set measurable objectives for achieving gender diversity in the composition of its board, senior executive and workforce generally; and (c) disclose in relation to each reporting period: (1) the measurable objectives set for that period to achieve gender diversity (2) the entity’s progress towards achieving those objectives; and (3) either: (A) the respective proportions of men and women on the board, in senior executive positions and across the whole workforce (including how the entity has defined “senior executive” for these purposes); or (B) if the entity is a “relevant employer” under the Workplace Gender Equality Act, the entity’s most recent “Gender Equity Indicators”, as defined in and published under that Act. If the entity was in the S & P/ASX 300 index at the commencement of the reporting period, the measurable objective for achieving gender diversity in the composition of its board should be to have not less than 30% of its directors of each gender within a specified period. The Company has adopted a Diversity Policy which is available in the ‘Corporate Governance’ section of the Company's website at http://www.lakeresources.com.au. In this reporting period, the Group has successfully increased its gender diversity compared to the last reporting period. The Company currently has two female board members (2022:1) representing 33% of the Board and three female senior executives (2022: Nil) representing 37.5% of senior executives. The Company currently has 56 female employees representing 33.1% of the total number of employees. The Board notes that it has made substantial progress over the last year to actively manage diversity as a means of enhancing the Company’s performance by recognising and utilising the contribution of diverse skills and talent from its directors, senior management, and employees. While the Board remains committed to the goal of gender diversity at all levels, given the size and stage of development of the Company, it has not yet set “measurable objectives” for achieving gender diversity in the composition of its board, senior executive or workforce generally. However, the Board will continually monitor this position pursuant to the Company’s Diversity Policy, and will implement measurable objectives as and when it deems the Company to require them. The future implementation of any measurable objectives will be disclosed to shareholders via the Company’s website and outcomes following the implementation of measurable objectives will be disclosed in its annual report. 124 2023 Corporate Governance Statement (continued) ASX Principles and Recommendations 1. Lay solid foundations for management and oversight (Continued) 1.6. A listed entity should: Yes Comply (Yes/No) Explanation (a) have and disclose a process for the periodically performance of its committees and individual directors; and the board, evaluating (b) disclose for each reporting period whether performance evaluation has been undertaken in accordance with that process during or in respect of that period. a 1.7. A listed entity should: Yes (a) have and disclose a process for evaluating the performance of its senior executives at least once every reporting period; and (b) disclose for each reporting period whether performance evaluation has been undertaken in accordance with that process during or in respect of that period. a The Company has a Compensation Committee which is the responsible for overseeing the annual evaluations of as directors, its Board, appropriate. committees individual and A copy of the Company’s Compensation Committee Charter and Performance Evaluation Policy is available in the ‘Corporate Governance’ section of the Company’s website at http://www.lakeresources.com.au. Each committee of the Board is also responsible for annually performing an evaluation of that committee. the performance of The Company undertook a renewal of the Board and its committees during the reporting period. Therefore, due to these substantial changes, the performance evaluations in respect of these roles have not yet taken place and are due to be completed in the next reporting period. Accordingly, the Company will report on these performance evaluations in the annual report for the next reporting period. The Company has and Governance Committee which is responsible for overseeing the annual evaluations of its senior executives, including the Managing Director and Chief Executive Officer, as appropriate. a Nomination As above, a copy of the Company’s Compensation Committee Charter and Performance Evaluation Policy is available in the ‘Corporate Governance’ section of the Company’s website at http://www.lakeresources.com.au. The Chairman is responsible for undertaking the evaluation of the MD/CEO, and this evaluation is based on specific criteria, including the business performance of the Company and its subsidiaries, whether strategic objectives are being achieved and the development of management and personnel. The MD/CEO is responsible for evaluating the performance of the senior executives in each reporting period. The Company appointed a new Managing Director and team during the reporting period. senior management Therefore, due to these changes, the performance evaluations in respect of these roles have not yet taken place and are due to be completed in the next reporting period. Accordingly, the Company will report on these performance evaluations in the annual report for the next reporting period. 125 139139 2023 Corporate Governance Statement (continued) ASX Principles and Recommendations 2. Structure the board to be effective and add value 2.1. The board of a listed entity should: Yes Comply (Yes/No) Explanation (a) have a nomination committee which: (1) has at least three members, a majority of whom are independent directors; and (2) is chaired by an independent director, and disclose: (3) the charter of the committee; (4) the members of the committee; and the number of (5) as at the end of each reporting times the period, committee met the throughout individual period the attendances of the members at those meetings; or and The Company has constituted a Nomination and Governance Committee which has three members who are all independent directors, and is therefore chaired also by an independent director. The committee is comprised of the following directors: • Cheemin Bo Linn - Chair • Robert Trzebski • Ana Gomez Chapman The relevant qualifications and experience of the directors listed above can be found in their biographies located in the Directors’ Report section of the annual report. times the Committee met the The number of reporting period and the individual attendances at those meetings, are recorded in the Company’s Annual Financial Statements. throughout The Charter of the Nomination and Governance Committee is available in the ‘Corporate Governance’ section of the Company’s website at http://www.lakeresources.com.au. (b) if it does not have a nomination fact and committee, disclose that the processes it employs to address board succession issues and to the board has the ensure that of appropriate skills, balance experience, knowledge, independence to and enable it to discharge its duties and responsibilities effectively. diversity 140 126 LAKE RESOURCES ANNUAL REPORT 2023 2023 Corporate Governance Statement (continued) ASX Principles and Recommendations (Yes/No) Explanation 2. Structure the board to be effective and add value Comply 2.1. The board of a listed entity should: Yes The Company has constituted a Nomination and Governance Committee which has three members who are all independent directors, and is therefore chaired also by an independent director. The committee is comprised of the following directors: • Cheemin Bo Linn - Chair • Robert Trzebski • Ana Gomez Chapman The relevant qualifications and experience of the directors listed above can be found in their biographies located in the Directors’ Report section of the annual report. The number of times the Committee met throughout the reporting period and the individual attendances at those meetings, are recorded in the Company’s Annual Financial The Charter of the Nomination and Governance Committee is available in the ‘Corporate Governance’ section of the Company’s website at http://www.lakeresources.com.au. (4) the members of the committee; and Statements. (a) have a nomination committee which: (1) has at least three members, a majority of whom are independent directors; and (2) is chaired by an independent director, and disclose: (3) the charter of the committee; (5) as at the end of each reporting period, the number of times the committee met throughout the period and the individual attendances of the members at those meetings; or (b) if it does not have a nomination committee, disclose that fact and the processes it employs to address board succession issues and to ensure that the board has the appropriate knowledge, balance of skills, experience, independence and diversity to enable it to discharge its duties and responsibilities effectively. 2023 Corporate Governance Statement (continued) Comply (Yes/No) Explanation ASX Principles and Recommendations 2. Structure the board to be effective and add value (Continued) 2.2. A listed entity should have and disclose a board skills matrix setting out the mix of skills that the board is looking to currently has or achieve in its membership. No During the reporting period the Company did not disclose a board skills matrix. With the renewal of the Board in the reporting period, the board skills matrix is currently being developed by the newly constituted Nomination and Governance Committee, and is scheduled to be in place by November 30. On a collective basis, the Board considers that it currently has the right mix of forward-looking perspective, and relevant skills, experience and expertise necessary, to successfully further the development of the Company. The board skills matrix being developed by the Nomination and Governance Committee reflects the Board's objective to have an recent and meaningful and specific appropriate mix of industry and professional experience, including relevant skills, experience and expertise in key focus areas such as mineral leadership, risk management, governance, Government and community engagement and international business operations. development exploration, strategy, finance, project 2.3. A listed entity should disclose: Yes the names of (a) the directors considered by the board to be independent directors; if a director has an interest, (b) position, association or relationship of the type described in Box 2.3 but the board is of the opinion that it the does the independence of nature of the interest, position or relationship in question and an explanation of why the board is of that opinion; and the director, compromise not The following is a list of directors considered by the Board to be independent and their length of service: • Howard Atkins (less than 1 year) • Cheemin Bo Linn (less than 1 year) • Ana Chapman; (less than 1 year) • Robert Trzebski (3 years). The Board has not been informed by any of the directors listed above of any conflicts of interest that may compromise the independence of that director. (c) the length of service of each director. 126 127 141141 2023 Corporate Governance Statement (continued) ASX Principles and Recommendations 2. Structure the board to be effective and add value (Continued) 2.4. A majority of the board of a listed independent should Yes be Comply (Yes/No) Explanation entity directors. The Board has 4 independent directors on the Board, which constitutes 66% (4/6) of the Board being independent directors. 2.5. The chair of the board of a listed entity should be an independent director and, in particular, should not be the same person as the CEO of the entity. Yes Yes for 2.6. A listed entity should have a program for inducting new directors and reviewing periodically whether there is a need for existing directors to undertake professional development to maintain the skills and knowledge needed to perform their role as directors effectively. this report The Chairman, Mr Stuart Crow, is not considered at the date of to be an independent director. During the reporting period, the Company appointed Mr Stuart Crow as Executive Chairman on 20 June 2022 and he held that role until 5 January 2023. This appointment was to facilitate the transition from the former MD/CEO to Mr David Dickson, who was appointed MD/CEO with effect from 15 September 2022. Prior to his appointment as Executive Chairman, the Board considered Mr Crow to be an independent Director. The Chairman and the MD/CEO are no longer, since 15 September 2022, the same person. Upon appointment to the Board, the Company requires new Directors to be provided with access to Company policies and procedures and have access to senior executives and other members of the Board to discuss and gain an understanding of the Company's operations and activities. Site visits to the Company’s operations will also be made available where appropriate. Directors are encouraged to attend seminars and industry conferences which enable industry them to maintain their understanding of relevant matters the and Company’s operations. advancements technical effecting The Company’s Nomination and Governance Committee is responsible for approving and reviewing induction and continuing and procedures for directors to ensure that they can effectively discharge their responsibilities. development professional programs 142 128 LAKE RESOURCES ANNUAL REPORT 2023 2023 Corporate Governance Statement (continued) ASX Principles and Recommendations (Yes/No) Explanation 2. Structure the board to be effective and add value (Continued) Comply 2.4. A majority of the board of a listed Yes entity should be independent directors. 2.5. The chair of the board of a listed Yes entity should be an independent director and, in particular, should not be the same person as the CEO of the entity. 2.6. A listed entity should have a Yes program for inducting new directors and for periodically reviewing whether there is a need for existing directors to undertake professional development to maintain the skills and knowledge needed to perform their role as directors effectively. The Board has 4 independent directors on the Board, which constitutes 66% (4/6) of the Board being independent directors. The Chairman, Mr Stuart Crow, is not considered at the date of this report to be an independent director. During the reporting period, the Company appointed Mr Stuart Crow as Executive Chairman on 20 June 2022 and he held that role until 5 January 2023. This appointment was to facilitate the transition from the former MD/CEO to Mr David Dickson, who was appointed MD/CEO with effect from 15 September 2022. Prior to his appointment as Executive Chairman, the Board considered Mr Crow to be an independent Director. The Chairman and the MD/CEO are no longer, since 15 September 2022, the same person. Upon appointment to the Board, the Company requires new Directors to be provided with access to Company policies and procedures and have access to senior executives and other members of the Board to discuss and gain an understanding of the Company's operations and activities. Site visits to the Company’s operations will also be made available where appropriate. Directors are encouraged to attend seminars and industry conferences which enable them to maintain their understanding of relevant industry matters and technical advancements effecting the Company’s operations. The Company’s Nomination and Governance Committee is responsible for approving and reviewing induction and continuing professional development programs and procedures for directors to ensure that they can effectively discharge their responsibilities. 2023 Corporate Governance Statement (continued) ASX Principles and Recommendations 3. Instill a culture of acting lawfully, ethically and responsibly 3.1. A listed entity should articulate and Yes Comply (Yes/No) Explanation disclose its values. 3.2. A listed entity should: Yes (a) have and disclose a code of conduct its directors, senior executives and employees; and for (b) ensure that the board or a committee of the board is informed of any material breaches of that code. 3.3. A listed entity should: have (a) whistleblower policy: and and disclose Yes a incident (b) ensure that the board or a committee of the board is informed of any material reported under that policy. 3.4. A listed entity should: have (a) an anti-bribery and corruption policy; and disclose and Yes The Company’s Corporate Code of Conduct applies to all Directors, officers, contractors, senior executives, and employees (“Staff”). The Code of Conduct contains a set of general principles and the Company has adopted a statement of values that each member of Staff must adhere to. Staff are expected to act with integrity and objectively, always striving to enhance the reputation and performance of the Company. Staff are under the obligation to ensure that the Code of Conduct is not breached. If any member of Staff notice any violations or material breaches of the Conduct of Conduct, they must notify the Managing Director and Chief Executive Officer, (if applicable). The Company views breaches of the Code of Conduct as serious misconduct, and any breach of the Code of Conduct will be thoroughly investigated and appropriate action will be taken by the Company. the Company or a supervisor the Chair of A copy of the Company's Code of Conduct is available in the ‘Corporate Governance’ section of the Company's website at http://www.lakeresources.com.au. As outlined above, the Company has a Code of Conduct for its directors, senior executives and employees, which is the published in the ‘Corporate Governance’ section of Company’s website at http://www.lakeresources.com.au. Pursuant to the Code of Conduct, employees must report breaches of the Code of Conduct and/or any suspected corrupt conduct to the Board. The Company has a formal Whistleblower Policy which is published in the ‘Corporate Governance’ section of the Company’s website at http://www.lakeresources.com.au. The Whistleblower Policy provides a procedure for the Board to be informed of any material incident reported under the policy. The Company has a formal Anti-bribery and Corruption Policy which is published in the ‘Corporate Governance’ section at http://www.lakeresources.com.au. Company’s website the of the board or a (b) ensure that committee of the board is informed of any material breaches of that policy. The Anti-bribery and Corruption Policy provides a procedure for the Board to be informed of any material incident reported under the policy. 128 129 143143 The Company has an Audit and Risk Committee which has three members who are all independent. The committee is comprised of the following directors: • Howard Atkins - Chair • Cheemin Bo Linn • Ana Gomez Chapman The relevant qualifications and experience of the directors listed above can be found in their biographies located in the Directors’ Report section of the annual report. The number of reporting period and the individual attendances at meetings are recorded in the Annual Financial Statements. times the Committee met throughout the those The Charter of the Audit and Risk Committee is available in the ‘Corporate Governance’ section of the Company’s website at http://www.lakeresources.com.au. 2023 Corporate Governance Statement (continued) ASX Principles and Recommendations 4. Safeguard the integrity of corporate reports 4.1. The board of a listed entity should: Yes Comply (Yes/No) Explanation (a) have an audit committee which: (1) has at least three members, all of whom are non-executive directors and a majority of whom are independent directors; and (2) is chaired by an independent director, who is not the chair of the board, and disclose: (3) the charter of the committee; (4) the relevant qualifications and experience of the members of the committee; and (5) in relation to each reporting period, the number of times the committee met the period individual attendances of the members at those meetings; or throughout the and if it employs it does not have an audit (b) fact and committee, disclose that the processes that independently verify and safeguard corporate its of the reporting, including the processes for the appointment and removal of the external auditor and the rotation of the audit engagement partner. integrity 144 130 LAKE RESOURCES ANNUAL REPORT 2023 The Company has an Audit and Risk Committee which has three members who are all independent. The committee is comprised of the following directors: • Howard Atkins - Chair • Cheemin Bo Linn • Ana Gomez Chapman The relevant qualifications and experience of the directors listed above can be found in their biographies located in the Directors’ Report section of the annual report. The number of times the Committee met throughout the reporting period and the individual attendances at those meetings are recorded in the Annual Financial Statements. The Charter of the Audit and Risk Committee is available in the ‘Corporate Governance’ section of the Company’s website at http://www.lakeresources.com.au. 2023 Corporate Governance Statement (continued) ASX Principles and Recommendations (Yes/No) Explanation 4. Safeguard the integrity of corporate reports 4.1. The board of a listed entity should: Yes Comply (a) have an audit committee which: (1) has at least three members, all of whom are non-executive directors and a majority of whom are independent directors; and (2) is chaired by an independent director, who is not the chair of the board, and disclose: (3) the charter of the committee; (4) the relevant qualifications and experience of the members of the committee; and (5) in relation to each reporting period, the number of times the committee met throughout the period and the individual attendances of the members at those meetings; or (b) if it does not have an audit committee, disclose that fact and the processes it employs that independently verify and safeguard the integrity of its corporate reporting, including the processes for the appointment and removal of the external auditor and the rotation of the audit engagement partner. 130 2023 Corporate Governance Statement (continued) The Company complies with this recommendation. Please refer to the ‘Directors’ Declaration’ in the Company’s annual report. Comply (Yes/No) Explanation Yes have ASX Principles and Recommendations 4. Safeguard the integrity of corporate reports (Continued) 4.2. The board of a listed entity should, before it approves the entity’s financial statements for a financial period, receive from its CEO and CFO a declaration that, in their opinion, the financial records of the properly entity maintained and that the financial the comply statements appropriate accounting standards and give a true and fair view of the financial position and performance the opinion of has been formed on the basis of a sound system of risk management and is internal operating effectively. the entity and that control which been with 4.3. A listed entity should disclose its process to verify the integrity of any periodic corporate report it releases to the market that is not audited or reviewed by an external auditor. Yes 5. Make timely and balanced disclosure 5.1. A listed entity should have and policy a written for disclose complying with continuous its disclosure obligations under listing rule 3.1. 5.2. A listed entity should ensure that its board receives copies of all material market announcements promptly after they have been made. 5.3. A listed entity that gives a new and analyst investor substantive presentation should release a copy of the presentation materials on the ASX Announcements Platform ahead of the presentation. Market or Yes Yes Yes Periodic corporate reports that are not audited or reviewed by an external auditor are circulated to all directors and reviewed by the Board before release. Reports on exploration and drilling activities are also signed by a competent person, as required by the JORC Code 2012. The Company’s Continuous Disclosure Policy is available in the ‘Corporate Governance’ section of the Company’s website at http://www.lakeresources.com.au. The Company has a Continuous Disclosure Policy which is available in the ‘Corporate Governance’ section of the Company’s website at http://www.lakeresources.com.au. The Company has processes in place to ensure that copies of all market announcements are circulated promptly to the Board either before or after they have been made. The Company Secretary must also maintain a copy of all announcements released. Any new and substantive presentations made by the Company are released to the ASX Market Announcements Platform ahead of the presentation, a copy of which is available on the Company's website from time to time in the ‘ASX at section Announcements’ http://www.lakeresources.com.au when released. 131 145145 2023 Corporate Governance Statement (continued) Comply (Yes/No) Explanation ASX Principles and Recommendations 6. Respect the rights of security holders 6.1. A listed entity should provide information about itself and its governance to investors via its website. 6.2. A listed entity should have an program that relations two-way investor facilitates communication with investors effective Yes Yes 6.3. A listed entity should disclose how it encourages facilitates participation at meetings of security holders. and Yes 6.4. A listed entity should ensure that all substantive resolutions at a meeting of security holders are decided by a poll rather than by a show of hands. 6.5. A listed entity should give security receive option holders communications from, and send communications to, the entity and its security registry electronically. the to Yes Yes Company maintains The containing comprehensive information on the Company including a company profile, corporate strategy, policy statements including corporate governance, Board of Directors, and contact information. website a All the Company’s quarterly, half year and annual reports and other disclosures are available on the Company website in the ‘Investors’ section at http://www.lakeresources.com.au. The Company complies with this recommendation and communicates with shareholders via releases to the market on the ASX platform, through the Company’s website, by information provided directly to shareholders at webinar briefing meetings open to all shareholders and the public, and at general meetings. The Company has also appointed in the reporting period a new position of Senior Vice Investor Relations and Communications to President facilitate enquiries from investors and to facilitate an effective two-way communication with the Company’s investors. - The Company encourages shareholders to attend and participate in general meetings by releases to the market on the ASX platform, through the Company’s website, and by information provided directly to shareholders at webinar briefing meetings open to all shareholders and the public. If a shareholder wishes to provide a comment or question prior to the meeting for consideration at the meeting, a process for doing this is communicated to shareholders prior to each meeting. All resolutions at general meetings are decided by a poll. The Company provides all security holders with the option to receive communications electronically. 146 132 LAKE RESOURCES ANNUAL REPORT 2023 2023 Corporate Governance Statement (continued) ASX Principles and Recommendations (Yes/No) Explanation Comply 6. Respect the rights of security holders 6.1. A listed entity should provide Yes information about itself and its governance to investors via its website. The Company maintains a website containing comprehensive information on the Company including a company profile, corporate strategy, policy statements including corporate governance, Board of Directors, and contact information. All the Company’s quarterly, half year and annual reports and other disclosures are available on the Company website in the ‘Investors’ section at http://www.lakeresources.com.au. The Company complies with this recommendation and communicates with shareholders via releases to the market on the ASX platform, through the Company’s website, by information provided directly to shareholders at webinar briefing meetings open to all shareholders and the public, and at general meetings. The Company has also appointed in the reporting period a new position of Senior Vice President - Investor Relations and Communications to facilitate enquiries from investors and to facilitate an effective two-way communication with the Company’s investors. The Company encourages shareholders to attend and participate in general meetings by releases to the market on the ASX platform, through the Company’s website, and by information provided directly to shareholders at webinar briefing meetings open to all shareholders and the public. If a shareholder wishes to provide a comment or question prior to the meeting for consideration at the meeting, a process for doing this is communicated to shareholders prior to each meeting. All resolutions at general meetings are decided by a poll. The Company provides all security holders with the option to receive communications electronically. 6.2. A listed entity should have an Yes investor relations program that facilitates effective two-way communication with investors 6.3. A listed entity should disclose how it Yes facilitates and encourages participation at meetings of security holders. 6.4. A listed entity should ensure that all Yes substantive resolutions at a meeting of security holders are decided by a poll rather than by a show of hands. 6.5. A listed entity should give security Yes holders the option to receive communications from, and send communications to, the entity and its security registry electronically. 2023 Corporate Governance Statement (continued) ASX Principles and Recommendations 7. Recognise and manage risk 7.1. The Board of a listed entity should: (a) have a committee or committees to oversee risk, each of which: Comply (Yes/No) Explanation Yes The Company has an Audit and Risk Committee which has three members who are all the members and experience of the Committee are set out at 4.1 above. independent. Details of (1) has at least three members, a majority of whom are independent directors; and The number of the times the Committee met period and the individual attendances at those meetings are recorded in the Annual Financial Statements. throughout (2) is chaired by an independent director, and disclose: (3) the charter of the committee; (4) the members of the committee; and The Charter of the Audit and Risk Committee is available in the ‘Corporate Governance’ section of on the Company’s website at http://www.lakeresources.com.au. the number of (5) as at the end of each reporting times the period, committee met the throughout individual period the attendances of the members at those meetings; or and or committees (b) if it does not have a risk that committee satisfy (a) above, disclose that fact and the processes it employs for overseeing risk management framework. entity’s the 132 133 147147 2023 Corporate Governance Statement (continued) Comply (Yes/No) Explanation ASX Principles and Recommendations 7. Recognise and manage risk (Continued) 7.2. The board or a committee of the Yes board should: entity’s the framework at risk review (a) least management annually to satisfy itself it continues to be sound and that the entity is operating with due regard to the risk appetite set by the board; and that (b) disclose in relation to each reporting period, whether such a review has taken place. 7.3. A listed entity should disclose: Yes if it has an internal audit (a) function, is structured and what role it performs; or how the function function, (b) if it does not have an internal audit fact and the that processes it employs for evaluating the and effectiveness of its governance, risk management and internal control processes. continually improving During the reporting period, the Company and the Audit and Risk Committee undertook a comprehensive review of its risk management practices and is in the process of implementing a new robust risk management program, including adopting policies and procedures for the identification, management and reporting of risk. As a lithium developer, the Company faces inherent risks in its development activities. The Company’s risk management program focuses on both operational risk and enterprise risk. The Company’s program with respect to operational risk is mature, identification, analysis and mitigation. The Company’s enterprise risk management process is maturing. During the reporting period, the Company’s senior management has identified several enterprise risks and has adopted plans to track and mitigate each. focusing on risk Further detail on the Company’s assessment of material business risks can be found in the Directors’ Report section of the Company’s annual report. The Company does not have a formal internal audit function due to its current size and stage of development. However, the Audit and Risk Committee monitors the need for an internal audit function on an ongoing basis, and will implement as and when they deem the Company required it. review of The Company’s management periodically undertakes an internal financial systems and processes and ensures that comprehensive internal controls and processes are developed with respect to certain classes of risk. At this stage, the Company’s operational and financial functions are not complex, and expenditure authorisations are undertaken in accordance with a comprehensive matrix of delegated authority. The Company’s external auditor is consulted to provide advice to the Audit and Risk Committee. 148 134 LAKE RESOURCES ANNUAL REPORT 2023 2023 Corporate Governance Statement (continued) Comply (Yes/No) Explanation ASX Principles and Recommendations 7. Recognise and manage risk (Continued) 7.4. A listed entity Yes it has should disclose whether any material exposure to environmental or social risks and, if it does, how it manages or intends to manage those risks. Environmental:.The operations and proposed activities of the Company are subject to laws and regulations in the jurisdictions in which it operates concerning the environment. As with most exploration projects and mining operations, the Company’s activities are expected to have an impact on the environment. The Company is committed to conducting all of its activities to the highest standard of environmental obligation, including compliance with all environmental laws. Social:.The Board recognises that a failure to manage community and stakeholder expectations may lead to disruption to the Company’s operations. The Company’s to Code of Conduct outlines the Company’s commitment integrity and fair dealing in its business affairs and to a duty of care to all employees, clients, and stakeholders. The Code of Conduct sets out the principles covering appropriate conduct in a variety of contexts and outlines the minimum standard of behavior expected from employees when dealing with stakeholders. Further detail on the Company’s assessment of material business risks can be found in the Directors’ Report section of the Company’s annual report. 135 149149 2023 Corporate Governance Statement (continued) ASX Principles and Recommendations 8. Remunerate fairly and responsibly 8.1. The Board of a listed entity should: (a) have a remuneration committee which: (1) has at least three members, a majority of whom are independent directors; and (2) is chaired by an independent director, and disclose: (3) the charter of the committee; (4) the members of the committee; and the number of (5) as at the end of each reporting times the period, committee met the throughout the period individual the members at attendances of those meetings; or and it if not have does (b) a remuneration committee, disclose fact and the processes it that employs for setting the level and composition of remuneration for directors and senior executives and ensuring that such remuneration is appropriate and not excessive. 8.2. A listed entity should separately disclose its policies and practices regarding the remuneration of non- the directors executive remuneration of executive directors and other senior executives. and Comply (Yes/No) Explanation Yes The Company has a Compensation Committee which has three members who are all independent. The committee is comprised of the following directors: • Robert Trzebski - Chair • Howard Atkins • Cheemin Bo Linn The relevant qualifications and experience of the directors listed above can be found in their biographies located in the Directors’ Report section of the annual report. the times the Committee met The number of period and the individual attendances at those meetings are recorded in the Annual Financial Statements. throughout The Charter of the Compensation Committee is available in the Company’s the ‘Corporate Governance’ section of website at http://www.lakeresources.com.au. Yes The Company provides disclosure of its remuneration policies and practices regarding the remuneration of non-executive directors and the remuneration of executive directors and other senior executives in the Remuneration Report which forms part of its Annual Financial Statements. The Company’s Remuneration Principles are available in the ‘Corporate Governance’ section of the Company’s website at http://www.lakeresources.com.au. 150 136 LAKE RESOURCES ANNUAL REPORT 2023 2023 Corporate Governance Statement (continued) ASX Principles and Recommendations (Yes/No) Explanation 8. Remunerate fairly and responsibly Comply 8.1. The Board of a listed entity should: Yes The Company has a Compensation Committee which has three members who are all independent. The committee is (a) have a remuneration committee comprised of the following directors: which: (1) has at least three members, a majority of whom are independent directors; and (2) is chaired by an independent director, and disclose: (3) the charter of the committee; (4) the members of the committee; and (5) as at the end of each reporting period, the number of times the committee met throughout the period and the individual attendances of the members at those meetings; or (b) if it does not have a remuneration committee, disclose that fact and the processes it employs for setting the level and composition of remuneration for directors and senior executives and ensuring that such remuneration is appropriate and not excessive. disclose its policies and practices regarding the remuneration of non- executive directors and the remuneration of executive directors and other senior executives. 8.2. A listed entity should separately Yes 2023 Corporate Governance Statement (continued) ASX Principles and Recommendations 8. Remunerate fairly and responsibly (Continued) 8.3. A listed entity which has an equity- scheme remuneration Yes based should: Comply (Yes/No) Explanation • Robert Trzebski - Chair • Howard Atkins • Cheemin Bo Linn The relevant qualifications and experience of the directors listed above can be found in their biographies located in the Directors’ Report section of the annual report. The number of times the Committee met throughout the period and the individual attendances at those meetings are recorded in the Annual Financial Statements. The Charter of the Compensation Committee is available in the ‘Corporate Governance’ section of the Company’s website at http://www.lakeresources.com.au. (a) have a policy on whether participants are permitted to enter into transactions (whether through the use of derivatives or otherwise) the economic risk of which limit participating in the scheme; and (b) disclose summary of it. that policy or a The Company’s Trading Policy and the Corporations Act prohibit Key Management Personnel and a closely related from entering an party of Key Management Personnel arrangement if the arrangement would have the effect of limiting the exposure of the member to risk relating to an element of the members remuneration that has not vested or has vested but remains subject to a holding lock. Key Management Personnel of the Company and their closely related parties should not deal in Securities in the Company which may infringe this prohibition under the Corporations Act nor should any other Restricted Person enter into hedging transactions to limit his or her exposure in respect of any unvested entitlement to Securities he or she receives under any equity based remuneration scheme of the Company. The Company’s Trading Policy is available in the ‘Corporate at Governance’ http://www.lakeresources.com.au. the Company’s website section of N/A 9. Additional recommendations that apply only in certain cases 9.1. A listed entity with a director who does not speak the language in which board or security holder meetings are held or key corporate documents should disclose the processes it has in director place understands and can contribute to the discussions at those meetings and understands and can discharge their obligations in relation to those documents. are written ensure the to The Company provides disclosure of its remuneration policies and practices regarding the remuneration of non-executive directors and the remuneration of executive directors and other senior executives in the Remuneration Report which forms part of its Annual Financial Statements. The Company’s Remuneration Principles are available in the ‘Corporate Governance’ section of the Company’s website at http://www.lakeresources.com.au. 9.2. A listed entity established outside Australia that should meetings of security holders are held at a reasonable place and time. ensure an 9.3. A listed entity established outside Australia externally and managed listed entity that has an AGM, should ensure that is external auditor attends its AGM and is available to answer questions from security holders relevant to the audit. N/A N/A 136 137 151151 ADDITIONAL ASX INFORMATION Top holders grouped report Lake Resources N.L. Security class: LKE - Ordinary Shares As at date: 19 September 2023 Position Holder Name 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 CITICORP NOMINEES PTY LIMITED US REGISTER CONTROL A/C ACUITY CAPITAL INVESTMENT MANAGEMENT PTY LTD J P MORGAN NOMINEES AUSTRLALIA PTY LIMITED HSBC CUSTODY NOMINEES (AUSTRALIA) LIMITED BNP PARIBAS NOMS PTY LTD SYDNEY BUSINESS ADVISERS PTY LTD < CF SUPER FUND NO2 A/C> BNP PARIBAS NOMINEES PTY LTD BNP PARIBAS NOMINEES PTY LTD ACF CLEARSTREAM SUPERHERO SECURITIES LIMITED NATIONAL NOMINEES LIMITED MR DANIEL RUBEN BONAFEDE PARADISE MARINE PTY LTD MR DAMIAN ARTHUR FURNELL WARBONT NOMINEES PTY LTD MR SIMON JAMES KALINOWSKI MR LEIGH CHARLES MARTIN MR YUANSHENG FENG MR ZIJIANG YANG ETRADE SECURITIES LLC Total Holding 171,465,877 106.797.985 65,200,000 51,380,671 37,699,657 14,351,504 12,800,000 12,553,341 11,275,949 8,759,267 7,998,816 7,234,634 6,512,523 6,328,676 6,293,475 6,018,793 6,000,000 5,695,960 5,405,000 5,263,180 % IC 12.05% 7.51% 4.58% 3.61% 2.65% 1.01% 0.90% 0.88% 0.79% 0.62% 0.56% 0.51% 0.46% 0.44% 0.44% 0.42% 0.42% 0.40% 0.38% 0.37% 555,035,308 39.02% Total issued capital - selected security class(es) 1,422,444,707 100.00% 152 LAKE RESOURCES ANNUAL REPORT 2023 Holdings Range Report Lake Resources N.L. Security Class: As at Date: Price per security: $0.1700 LKE - Ordinary Shares 19 September 2023 Holding Ranges Holders Total Units % Issued Share Capital above 0 up to and including 1,000 above 1,000 up to and including 5,000 above 5,000 up to and including 10,000 above 10,000 up to and including 100,000 above 100,000 Totals 7,178 13,353 5,672 9,173 1,447 36,823 4,525,741 35,487,829 43,619,035 289,102,176 1,049,709,926 1,422,444,707 0.32% 2.49% 3.07% 20.32% 73.80% 100.00% Based on the price per security, number of holders with an unmarketable holding: 15,437, with total 19,736,634, amounting to 1.39% of Issued Capital. Class of shares and voting rights At meetings of members or classes of members each member entitled to vote may vote in person or by proxy or attorney; and on a show of hands every person present who is a member has one vote, and on a poll every person present in person or by proxy or attorney has one vote for each ordinary share held. On-market buy-back There is no current on-market buy-back. 153153 OPT @ $0.55 EXP 12/07/24 OPT @ $0.49 EXP 01/08/24 OPT @ $1.48 EXP 19/01/25 OPT @ $0.565 EXP 25/10/24 OPT @ $1.42 EXP 26/04/2025 2019 PERFORMANCE OPT @ $1.50 EXP OPT @ $0.75 EXP OPT @ $1.13 EXP Restricted Stock OPT @ $1.00 EXP RIGHTS 22/08/2025 15/06/2025 15/09/2027 Units 24/10/2025 Holders Total Units Holders Total Units Holders Total Units Holders Total Units Holders Total Units Holders Total Units Holders Total Units Holders Total Units Holders Total Units Holders Total Units Holders Total Units 1 2,000,000 2 5,601.00 1 1,000.00 1 2,000,000 2 2,072,244 1 5,000,000 1 1,000,000 3 5,550,000 1 4,000,000 4 1,703,500 2 3,000,000 2,890,000 1,036,122 1,000,000 2,000,000 2,711,000 1,036,122 5,000,000 1,000,000 4,000,000 1,000,000 1,500,000 1,500,000 1,260,000 4,010,000 2,000,000 5,601,000 1,000,000 2,000,000 2,072,244 5,000,000 1,000,000 5,550,000 4,000,000 1,703,500 3,000,000 Unlisted Securities As at 19 September 2023 PETER NEILSEN 2,000,000 Range above 0 up to and including 1,000 above 1,000 up to and including 5,000 above 5,000 up to and including 10,000 above 10,000 up to and including 100,000 above 100,000 Totals Holders with > 20% MR MATTHEW BONNER MR GEOFFREY STUART CROW DAVID DICKSON GKB VENTURES LTD SEAN MILLER GAUTAM PARIMOO ROBWARD PTY LTD SD CAPITAL ADVISORY MR EDWARD ARYEH SUGAR Totals 154 LAKE RESOURCES ANNUAL REPORT 2023 Unlisted Securities As at 19 September 2023 Range above 0 up to and including 1,000 above 1,000 up to and including 5,000 above 5,000 up to and including 10,000 above 10,000 up to and including 100,000 above 100,000 Totals Holders with > 20% MR MATTHEW BONNER MR GEOFFREY STUART CROW DAVID DICKSON GKB VENTURES LTD SEAN MILLER GAUTAM PARIMOO ROBWARD PTY LTD SD CAPITAL ADVISORY MR EDWARD ARYEH SUGAR Totals OPT @ $0.55 EXP OPT @ $0.49 EXP OPT @ $1.48 EXP OPT @ $0.565 EXP OPT @ $1.42 EXP 12/07/24 01/08/24 19/01/25 25/10/24 26/04/2025 2019 PERFORMANCE RIGHTS OPT @ $1.50 EXP 22/08/2025 OPT @ $0.75 EXP 15/06/2025 OPT @ $1.13 EXP 15/09/2027 Restricted Stock Units OPT @ $1.00 EXP 24/10/2025 Holders Total Units Holders Total Units Holders Total Units Holders Total Units Holders Total Units Holders Total Units Holders Total Units Holders Total Units Holders Total Units Holders Total Units Holders Total Units 1 2,000,000 2 5,601.00 1 1,000.00 1 2,000,000 2 2,072,244 1 5,000,000 1 1,000,000 3 5,550,000 1 4,000,000 4 1,703,500 2 3,000,000 PETER NEILSEN 2,000,000 2,890,000 1,036,122 1,000,000 2,000,000 2,711,000 1,036,122 5,000,000 1,000,000 1,260,000 4,010,000 4,000,000 1,000,000 1,500,000 1,500,000 2,000,000 5,601,000 1,000,000 2,000,000 2,072,244 5,000,000 1,000,000 5,550,000 4,000,000 1,703,500 3,000,000 155 RESOURCE ESTIMATES AND GOVERNANCE A summary of the results of Lake’s annual review of its mineral resource estimates appears in Table 1 in the Review of Operations. Governance of Lake’s mineral resource estimates and the estimation process is a key responsibility of Lake’s management team, who have ensured that its mineral resources estimates are subject to appropriate levels of governance and internal controls. This includes procuring verification by a Competent Person of the mineral resource estimates disclosed by the Company, and the engagement of experts to verify certain field procedures and sampling methods used by Lake in its internal technical assessments of the mineral resource estimates used by the Company. The Statement of Estimates of Mineral Resources for the Kachi Project was reported by Lake in accordance with the rules for reporting mining and exploration activities, including the listing rules of the ASX and the Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Resources 2012 Edition (the JORC Code). This includes two resource updates during 2023, released and made available on the Company’s website and on the ASX on January 11, 2023 and June 15, 2023, respectively. Lake confirms it is not aware of any new information or data that materially affects the information included in the latest announcement dated June 15, 2023 and the end of financial year balance date, being June 30, 2023, and that all material assumptions and technical parameters underpinning the estimates in each of the previous announcements continue to apply and have not materially changed as at the date of this annual report. The two previous announcements noted above, which included updates to the mineral resource estimates for the Kachi Project, were verified by Mr. Andy Fulton, who also verified the maiden resource for the Kachi Project in 2018. Mr. Fulton is a hydrogeologist and is a Member of the Australian Institute of Geoscientists. Mr. Fulton is an employee of Groundwater Exploration Services, and is independent of the Company. Mr. Fulton has sufficient relevant experience 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. He is also a “Qualified Person” as defined in NI 43-101. During 2023, Mr. Andrew Fulton visited the Kachi Project on three separate occasions, reviewing multiple aspects of the exploration and development activities. Lake has reported on the mineral resources of its material mining project, the Kachi Project, on an annual basis in accordance with the JORC Code. As resources are developed for other Lake projects, which are not material mining projects (as defined in the listing rules of the ASX) as at the date of this annual report, those resources will be disclosed to investors in accordance with the Company’s obligations under the listing rules of the ASX, and included in the Company’s annual reporting in accordance with the JORC Code. In the absence of a developed JORC-compliant mineral resource, updates on the activities undertaken by the Company at Lake’s other project sites will otherwise be provided as and when required. 156 LAKE RESOURCES ANNUAL REPORT 2023 SCHEDULE OF TENEMENTS - CATAMARCA - JUJUY TOTAL NUMBER OF RESOURCES: 116 KACHI - ANTOFAGASTA DE LA SIERRA.- CATAMARCA TENEMENT NA NUMBER - GDE AREA H INTEREST PROVINCE STATUS MINING CONCESSION MARIA I MARIA II MARIA III KACHI INCA KACHI INCA I KACHI INCA II KACHI INCA III KACHI INCA V KACHI INCA VI DANIEL ARMANDO DANIEL ARMANDO II MORENA 1 MORENA 2 MORENA 3 MORENA 4 MORENA 5 MORENA 6 MORENA 7 MORENA 8 MORENA 9 EX - 2021 - 00362285 - CAT (140/2018) 1260.0736 EX - 2021 - 00373528 - CAT (14/2016) EX - 2021 - 00293511 – CAT (15/2016) EX - 2021 - 00361579 - CAT (13/2016) EX - 2021 - 00432837 – CAT (16/2016) EX - 2021 - 00221521 – CAT (17/2016) EX - 2121 - 00321200 – CAT (47/2016) EX - 2021 - 00208240 – CAT (45/2016) EX - 2021 - 00294250 – CAT (44/2016) EX - 2021 - 00208733 - CAT (23/2016) EX - 2021 - 00331263 – CAT (97/2016) 546.9333 834.7969 857.7131 2880.4365 2822.7403 3355.3649 305.1754 109.787 3121.876 1589.664 EX - 2021 - 00328638 – CAT (72/2016) 3024.4662 EX - 2021 - 00390312 – CAT (73/2016) EX - 2021 - 00361695 – CAT (74/2016) EX - 2021 - 00293790 – CAT (29/2019) EX - 2021 - 00221381 – CAT (97/2017) EX - 2021 - 00208283 – CAT (75/2016) EX - 2021 - 00259078 – CAT (76/2016) EX - 2021 - 00294310 - CAT (77/2016) EX - 2021 - 00368898 – CAT (30/2019) 2989.429 3007.1366 2967.6745 1415.8752 1606.1445 2804.9561 2961.0131 2821.5762 MORENA 10 EX - 2022 - 00508476 - CAT 2712.9283 MORENA 12 MORENA 13 EX - 2021 - 00259022 – CAT (78/2016) EX - 2021 - 00258895 – CAT (79/2016) 2703.6817 3024.4662 100 100 100 100 100 100 100 100 100 100 100 100 100 100 100 100 100 100 100 100 100 100 100 CATAMARCA GRANTED 15/11/2018 CATAMARCA GRANTED 24/8/2017 CATAMARCA GRANTED 24/8/2017 CATAMARCA GRANTED 24/8/2017 CATAMARCA GRANTED 24/8/2017 CATAMARCA GRANTED 24/8/2017 CATAMARCA GRANTED 24/8/2016 CATAMARCA GRANTED 10/10/2017 CATAMARCA GRANTED 24/8/2016 CATAMARCA GRANTED 24/8/2017 CATAMARCA GRANTED 7/10/2016 CATAMARCA GRANTED 7/10/2016 CATAMARCA GRANTED 7/10/2016 CATAMARCA GRANTED 7/10/2016 CATAMARCA GRANTED 18/9/2019 CATAMARCA GRANTED 29/11/2019 CATAMARCA GRANTED 7/10/2016 CATAMARCA GRANTED 7/10/2016 CATAMARCA GRANTED 7/10/2016 CATAMARCA GRANTED 29/11/2019 CATAMARCA APPLICATION CATAMARCA GRANTED 7/10/2016 CATAMARCA GRANTED 7/10/2016 157 TENEMENT NA NUMBER - GDE AREA H INTEREST PROVINCE STATUS MINING CONCESSION MORENA 15 EX - 2021 - 00360876 – CAT (162/2017) 2559.0852 PAMPA I PAMPA II PAMPA III PAMPA 11 PAMPA IV IRENE PARAPETO 1 PARAPETO 2 PARAPETO 3 EX - 2021 - 00233741 – CAT (129/2013) EX - 2021 - 00430058 -CAT (128/2013) EX - 2021 - 00429001 - CAT (130/2013) EX - 2021 - 00372498 – CAT (201/2018) EX - 2021 - 00322433 – CAT (78/2017) EX - 2021 - 00212993 – CAT (28/2018) EX - 2021 - 01648141 – CAT (133/2018) EX - 2021 - 00235750 – CAT (134/2018) EX - 2121 - 00261195 – CAT (132/2018) 690 1053.15 477.32 815 2569.3125 2052.2562 2280.5717 1729.716 1891.5621 PARAPETO III EX - 2021 - 00854749 – CAT 1949.1255 PARAPETO 4 EX - 2021 - 01651926 – CAT 1948.9079 GOLD SAND I TORNADO VII DEBBIE I DOÑA CARMEN DIVINA VICTORIA I DOÑA AMPARO I ESCONDIDITA GALAN OESTE MARIA LUZ NINA PADRE JOSE MARIA I PADRE JOSE MARIA II PADRE JOSE MARIA III PADRE JOSE MARIA IV PADRE JOSE MARIA V 158 EX - 2021 - 00376209 – CAT (238/2018) EX - 2021 - 00208328 – CAT (48/2016) EX - 2021 - 00196977 – CAT (21/2016) EX - 2021 - 00321876 – CAT (24/2016) EX - 2021 - 00368383 – CAT (25/2016) EX - 2021 - 00294138 – CAT (22/2016) EX - 2021 - 00143141 – CAT (131/2018) EX - 2021 - 00153718 – CAT (43/2016) EX - 2021 - 00153678 – CAT (34/2017) EX - 2021 - 00360751 – CAT (106/2020) EX - 2021 - 00432843 – CAT (95/2012) EX - 2021 - 00432950 -CAT (96/2012) EX - 2021 - 00433095 – CAT (94/2012) EX - 2021 - 00433149 – CAT (93/2012) EX - 2021 - 00647090 – CAT (92/2012) 853.602 6628.842 1742.85 873.1146 2420.1 2695.2986 373.4346 3166.9356 2424.9638 3125.0644 650.0094 1523.1476 1523.1476 1528.6905 1584.3384 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 CATAMARCA GRANTED 30/8/2018 CATAMARCA GRANTED 24/11/2016 CATAMARCA GRANTED 8/2/2016 CATAMARCA GRANTED 12/12/222 CATAMARCA GRANTED 7/2/2020 CATAMARCA GRANTED 22/3/2018 CATAMARCA GRANTED 6/9/2018 CATAMARCA GRANTED 24/9/2018 CATAMARCA GRANTED 24/9/2018 CATAMARCA GRANTED 28/11/2018 CATAMARCA GRANTED 23/8/2022 CATAMARCA GRANTED 23/8/2022 CATAMARCA GRANTED 24/4/2019 CATAMARCA GRANTED 24/11/2016 CATAMARCA GRANTED 24/8/2017 CATAMARCA GRANTED 24/8/2017 CATAMARCA GRANTED 24/8/2017 CATAMARCA GRANTED 24/8/2017 CATAMARCA GRANTED 24/9/2018 CATAMARCA GRANTED 14/10/2016 CATAMARCA GRANTED 27/3/2018 CATAMARCA GRANTED 26/10/2021 CATAMARCA GRANTED 29/1/2021* CATAMARCA GRANTED 29/1/2021* CATAMARCA GRANTED 29/1/2021* CATAMARCA GRANTED 29/1/2021* CATAMARCA GRANTED 29/1/2021* LAKE RESOURCES ANNUAL REPORT 2023 TENEMENT NA NUMBER - GDE AREA H INTEREST PROVINCE STATUS MINING CONCESSION PADRE JOSE MARIA VI EX - 2021 - 00647273 – CAT (91/2012) PADRE JOSE MARIA VII EX - 2021 - 00647377 – CAT (90/2012) PADRE JOSE MARIA VIII EX - 2021 - 00647631 – CAT (89/2012) 1507.3002 1499.7985 515.0332 TOTAL HECTAREAS: 104375.5867 (*)have been purchased but ownership still being transferred ANCASTI - CATAMARCA 100 100 100 CATAMARCA GRANTED 29/1/2021* CATAMARCA GRANTED 29/1/2021* CATAMARCA GRANTED 29/1/2021* TENEMENT NA NUMBER - GDE AREA H INTEREST PROVINCE STATUS PETRA I PETRA II PETRA III PETRA IV CATEO 1 CATEO 2 CATEO 3 CATEO 4 LA AGUADA 1 LA AGUADA 2 LA AGUADA 3 LA AGUADA 4 LA AGUADA 5 LA AGUADA 6 LA AGUADA 7 LA AGUADA 8 EX - 2021 - 01020531 - CAT (52/2016) 10000 EX - 2021 - 00145689 - CAT (51/2016) EX - 2021 - 00145810 - CAT (49/2016) EX - 2021 - 00145665 - CAT (50/2016) EX - 2021 - 01349707 - CAT (93/2016) EX - 2021 - 00145782 - CAT (94/2016) EX - 2021 - 00147744 - CAT (95/2016) EX - 2021 - 00145516 - CAT (98/2016) EX - 2021 - 00145356 - CAT (116/2016) EX - 2021 - 00145468 - CAT (117/2016) EX - 2021 - 00229232 - CAT (99/2016) EX - 2021 - 00145863 - CAT (173/2016) EX - 2021 - 00145839 - CAT (172/2016) EX - 2021 - 00145928 - CAT (174/2016) EX - 2021 - 00169048 - CAT (137/2016) EX - 2021 - 00168791 - CAT (139/2016) 9523.8616 9528.036 8938.6383 10000 8475 10000 10000 2498.5093 2949.6582 1558.993 2928.5403 2866 2999.15 2919.476 1586.6503 96772.513 TOTAL HECTAREAS (*)have been transferred to Barbara Cozzi. 100 100 100 100 100 100 100 100 100 100 100 100 100 100 100 100 CATAMARCA CATAMARCA CATAMARCA CATAMARCA CATAMARCA CATAMARCA CATAMARCA CATAMARCA CATAMARCA CATAMARCA CATAMARCA CATAMARCA CATAMARCA CATAMARCA CATAMARCA CATAMARCA CATEO GRANTED CATEO GRANTED CATEO GRANTED CATEO GRANTED CATEO GRANTER CATEO GRANTED CATEO GRANTED CATEO GRANTED MINE GRANTED MINE GRANTED MINE GRANTED MINE GRANTED MINE GRANTED MINE GRANTED MINE GRANTED MINE GRANTED MINING CONCESSION 31/3/2017* 31/3/2017* 17/8/2017* 17/8/2017* 17/5/2017 17/5/2017* 17/5/2017* 17/5/2017* 17/4/2017* 17/4/2017* 17/4/2017* 9/11/2017* 9/11/2017* 9/11/2017* 14/6/2018* 14/6/2018* 159 OLAROZ - JUJUY TENEMENT NA NUMBER - GDE AREA H INTEREST PROVINCE STATUS MINING CONCESSION OLAROZ EAST II MASA 12 MASA 13 MASA 14 MASA 15 MASA 24 MASA 25 MASA 26 MASA 27 MASA 28 MASA 29 MASA 30 MASA 31 MASA 32 MASA 33 MASA 34 MASA 35 MASA 36 MASA 37 MASA 38 TOTAL HECTAREAS CAUCHARI - JUJUY 2168-D-2016 2234-M-2016 2235-M-2016 2236-M-2016 2237-M-2016 2743-M-2021 2820-M-2021 2815-M-2021 2819-M-2021 2818-M-2021 2822-M-2021 2821-M-2021 2816-M-2021 2821-M-2021 2824-M-2021 2814-M-2021 2825-M-2021 2826-M-2021 2827-M-2021 2817-M-2021 2072.47 3000 3000 3000 3000 899.79 121.96 2169.34 2894.36 2410 2375.56 2391.24 2261.65 2261.41 2277.01 2234.46 2258.7 2260.75 2260.73 2260.72 45410.15 100 100 100 100 100 100 100 100 100 100 100 100 100 100 100 100 100 100 100 100 JUJUY JUJUY JUJUY JUJUY JUJUY JUJUY JUJUY JUJUY JUJUY JUJUY JUJUY JUJUY JUJUY JUJUY JUJUY JUJUY JUJUY JUJUY JUJUY JUJUY GRANTED 7/9/2023 GRANTED 14/4/2023 GRANTED 20/3/2023 GRANTED 8/5/2023 GRANTED 12/10/2021 APPLICATION APPLICATION APPLICATION APPLICATION APPLICATION APPLICATION APPLICATION APPLICATION APPLICATION APPLICATION APPLICATION APPLICATION APPLICATION APPLICATION APPLICATION TENEMENT NA NUMBER - GDE AREA H INTEREST PROVINCE STATUS MINING CONCESSION CAUCHARI BAJO I CAUCHARI BAJO II CAUCHARI BAJO III CAUCHARI BAJO V CAUCHARI WEST I 2156-D-2016 2157-D-2016 2158-D-2016 2154-D-2016 2160-D-2016 MASA 39 2828-M-2021 TOTAL HECTAREAS 374.8 363.1 125.3 952.1 1937.5 1749.1 5501.9 100 100 100 100 100 100 JUJUY JUJUY JUJUY JUJUY JUJUY JUJUY APPLICATION APPLICATION APPLICATION APPLICATION GRANTED 8/10/2019 APPLICATION 160 LAKE RESOURCES ANNUAL REPORT 2023 JAMA - JUJUY TENEMENT NA NUMBER - GDE AREA H INTEREST PROVINCE STATUS MINING CONCESSION MASA 9 MASA 16 MASA 17 MASA 18 MASA 19 MASA 20 MASA 21 MASA 22 MASA 23 MASA 40 MASA 41 MASA 42 MASA 43 MASA 44 MASA 45 MASA 46 MASA 47 MASA 48 PASO III PASOVI PASO X 2231-M-2016 2238-M-2016 2239-M-2016 2240-M-2016 2241-M-2016 2242-M-2016 2243-M-2016 2244-M-2016 2245-M-2016 2911-M-2022 2912-M-2022 2913-M-2022 2914-M-2022 2915-M-2022 2916-M-2022 2917-M-2022 2918-M-2022 SIN EXPTE 2137-P-2016 2140-P-2016 2144-P-2016 2985.5 3000 3000 3000 3000 3000 3000 2548.2 2405.8 2999.07 2999.07 2999.02 2848.5 2492.78 2975.88 2965.15 2783.14 892.24 2950.1 2210 1912.77 100 100 100 100 100 100 100 100 100 100 100 100 100 100 100 100 100 100 100 100 100 JUJUY JUJUY JUJUY JUJUY JUJUY JUJUY JUJUY JUJUY JUJUY JUJUY JUJUY JUJUY JUJUY JUJUY JUJUY JUJUY JUJUY JUJUY JUJUY JUJUY JUJUY APPLICATION GRANTED 30/6/2022 GRANTED 1/2/2023 APPLICATION APPLICATION GRANTED 1/2/2023 APPLICATION GRANTED 30/6/2022 GRANTED 29/7/2022 APPLICATION APPLICATION APPLICATION APPLICATION APPLICATION APPLICATION APPLICATION APPLICATION APPLICATION APPLICATION APPLICATION APPLICATION TOTAL HECTAREAS 56967.22 Total PM Lake Resources 116 161 LAKE RESOURCES N.L. Level 5, 126 Phillip Street Sydney NSW 2000 T: +61 2 9299 9690 E: hello@lakeresources.com.au lakeresources.com.au

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