Annual Report for the year ended 30 June 2021 Saturn Metals Limited ABN: 43 619 488 498 CORPORATE DIRECTORY Directors Brett Lambert Ian Bamborough Andrew Venn Robert Tyson Adrian Goldstone Company Secretary Natasha Santi Non-Executive Chairman Managing Director Non-Executive Director Non-Executive Director Non-Executive Director Share Registry Link Market Services Limited Level 12 QV1 Building 250 St Georges Terrace PERTH WA 6000 Telephone: Facsimile: Website: +61 1300 554 474 +61 (0)2 9287 0303 www.linkmarketservices.com Stock Exchange Listing Registered Office & Principal Place of Business 9 Havelock Street WEST PERTH WA 6005 Telephone: + 61 (0)8 6234 1114 Email: Website: info@saturnmetals.com.au www.saturnmetals.com.au ABN: ACN: 43 619 488 498 619 488 498 Auditors PricewaterhouseCoopers Level, 15 125 St Georges Terrace Perth WA 6000 Securities of Saturn Metals Limited are listed on the Australian Securities Exchange (ASX) ASX Code: STN Saturn Metals Limited is a Company registered under the Corporations Act 2001 in the State of Western Australia on 2nd June 2017. CONTENTS CHAIRMAN’S LETTER ................................................................................................................................... 2 REVIEW OF OPERATIONS ........................................................................................................................... 4 DIRECTOR’S REPORT ................................................................................................................................ 14 REMUNERATION REPORT (AUDITED) ...................................................................................................... 18 AUDITOR’S INDEPENDENCE DECLARATION ........................................................................................... 28 CONSOLIDATED STATEMENT OF PROFIT OR LOSS AND OTHER COMPREHENSIVE INCOME ........ 29 CONSOLIDATED STATEMENT OF FINANCIAL POSITION ....................................................................... 30 CONSOLIDATED STATEMENT OF CHANGES IN EQUITY ....................................................................... 31 CONSOLIDATED STATEMENT OF CASH FLOWS .................................................................................... 32 NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS ................................................................. 33 DIRECTOR’S DECLARATION ...................................................................................................................... 52 INDEPENDENT AUDITOR’S REPORT ........................................................................................................ 53 SCHEDULE OF TENEMENTS ..................................................................................................................... 58 MINERAL RESOURCE ESTIMATION GOVERNANCE STATEMENT ........................................................ 59 COMPETENT PERSONS STATEMENT ...................................................................................................... 60 ADDITIONAL SHARHEOLDER INFORMATION .......................................................................................... 61 1 SATURN METALS LIMITED – ANNUAL REPORT 2021 CHAIRMAN’S LETTER Dear Shareholders, I am very pleased to present to you the 2021 Annual report for Saturn Metals Limited (the “Company”). 2021 was a very active year for the Company in which it continued to progress its flagship Apollo Hill Gold Project in the north-eastern Goldfields of Western Australia and initiated exploration at the West Wyalong Goldfield in New South Wales. In the Company’s most aggressive drilling campaign since listing on the ASX, Saturn completed over 90,000 metres of drilling during the year. At Apollo Hill, almost 80,000 metres of reverse circulation (RC) drilling was carried out, generating many high value intercepts, including some of the best results achieved at the project to date. In the first half of the year drilling focused on resource definition, leading to the release of an updated Mineral Resource estimate in January 2021. The Inferred and Indicated Mineral Resource at Apollo Hill now totals almost one million ounces of contained gold. Importantly, the proportion of the Mineral Resource classified at the higher confidence Indicated level has grown to 59%. It is also significant to note that for the first time, the reported Mineral Resource has been constrained by a preliminary open pit shell. This will lead to a high resource to reserve conversion, subject of course to the satisfactory completion of mining studies. However there are many strongly mineralised drill intercepts which have been excluded from the current resource and these are considered to present clear opportunity for future resource growth. In the second half of the year, RC drilling targeted lateral extensions to the Apollo Hill deposit. This program was particularly successful to the south where drilling now indicates that mineralisation continues from the Ra zone at the southern end of the main deposit through to the previously isolated Tefnut zone and beyond, a total strike length of three kilometres and growing. Potential to extend Apollo Hill to the north also appears strong and this area has become the focus of recent drilling. In 2021 the Company stepped up evaluation of the broader Apollo Hill project area with more than 12,000 metres of air-core drilling completed at several regional prospects. This work is at an early stage but has already delivered some encouraging results and remains ongoing. With a well-defined resource of significant scale established, the Company has begun to place greater emphasis on shaping the pathway to gold production at Apollo Hill. An important element of this work will be identifying the optimal processing route for Apollo Hill ore. A major metallurgical test work program is underway utilising 27 tonnes of composite drill samples which will provide key data to support evaluation of potential treatment options. Work completed to date has shown that high gold recoveries are readily achievable. However the Company is seeking to prioritise value by targeting a production route that will deliver the optimal balance between gold recovery, resource utilisation, operating margins and capital intensity. Another significant undertaking in 2021 was the drilling of two large scale trial grade control grids within the Apollo Hill resource. This exercise provided solid confirmation of resource continuity and generated valuable data on gold grade distribution. Results of the metallurgical program, trial grade control drilling and of course resource definition drilling, will be important inputs for the next update of the Apollo Hill Mineral Resource estimate, which the Company expects to complete and release in the March 2022 quarter. During the year Saturn established a presence at West Wyalong and in June 2021 commenced the first modern drilling program at this historically prolific high-grade goldfield. This achievement was not insignificant given the constraints COVID 19 placed on travelling and working within New South Wales. SATURN METALS LIMITED – ANNUAL REPORT 2021 2 CHAIRMAN’S LETTER (Cont.) We are at an early stage in developing our knowledge and understanding of this exciting project, and near-term West Wyalong will continue to represent a small component of the Company’s work effort as focus remains on progressing Apollo Hill towards development. To sustain the high level of field activity and progress pre-development studies, Saturn raised additional capital of $12.6 million (net of costs) through a placement of shares to institutional and sophisticated investors. At year end the Company retained a healthy cash balance of $8.2 million. In May 2021 we welcomed Adrian Goldstone to the Board as a Non-executive Director. Adrian has extensive and diverse international minerals industry experience with a strong focus on environmental and social sustainability and corporate governance. His appointment broadens the skillset of the Saturn Board better equipping the Company to transition through development and into production. In closing I would like to acknowledge the steadfast efforts of our Managing Director, Ian Bamborough, and his team who have worked exceptionally hard under challenging conditions to significantly advance the Company’s projects. I also wish to thank Saturn’s shareholders for their continued support of the Company through this exciting period in its development. Yours sincerely, Brett Lambert Chairman 3 SATURN METALS LIMITED – ANNUAL REPORT 2021 REVIEW OF OPERATIONS Company Profile Saturn Metals Limited (“Saturn”) was incorporated on 2 June 2017 for the purposes of gold exploration and development. Saturn listed on the Australian Securities Exchange on 9 March 2018. Saturn’s primary objective is to focus on mineral exploration and resource opportunities that have the potential to deliver growth for shareholders. Saturn’s vision is to create superior value for its shareholders by discovering, developing and monetising world-class gold deposits. Saturn’s management strategy is to: continue a successful exploration program in respect to the Apollo Hill camp towards rapidly growing the Resource base; conduct further exploration activities across the Apollo Hill strategic land package towards identifying and growing new higher-grade gold lode/vein exploration targets; and continue a cost-effective exploration program in respect to its other Australian opportunities and ventures. In addition, Saturn looks to expand its current project portfolio by seeking opportunities to: apply for additional tenements to complement the Project; or acquire, either by way of an asset or share purchase, complementary projects. As at 30 June 2021: Shares on Issue: 112,464,510 Share Price: $0.41 Market Capitalisation: $46M Cash: $8.16M 0.944Moz 2021 Mineral Resource1 Drilling at Apollo Hill 1 This document contains exploration results and historic exploration results as originally reported in fuller context in Saturn Metals Limited ASX Announcements - as published on the Company's website. Saturn Metals Limited confirms that it is not aware of any new information or data that materially affects the information on results noted. 1 Details of the Mineral Resource breakdown by category are presented in Table 1a* (on page 59 of this document) along with the associated Competent Persons statement (page 60) and details of the original ASX report that this information was originally published in. SATURN METALS LIMITED – ANNUAL REPORT 2021 4 REVIEW OF OPERATIONS (Cont.) Growth at Apollo Hill Our flagship Apollo Hill Project which covers approximately 1000km2 of contiguous exploration and mining tenements is situated in the heart of the world-class Eastern Goldfields 650km NE of Perth, Western Australia.The Project is located approximately 60km by road from the gold mining and processing town of Leonora and sits in a central strategic position to established gold mining infrastructure (Figure 1). Figure 1 – Saturn’s Apollo Hill Gold Project – Regional setting, Infrastructure and Landscape. At the heart of our ground package, is the Company’s Apollo Hill deposit which occurs in a mineralised structure associated with the 5km long and 500m wide Apollo-Ra Shear Zone. This shear zone is a parallel component of the district prevalent, gold fertile, and highly prospective Keith-Kilkenny Fault system in the gold prolific Norseman-Wiluna Greenstone Belt (Figure 1). The Apollo Hill deposit, which bears all the hallmarks of a major mineralised Archean lode gold system is characterised by simple metallurgy (free milling coarse gold with low cyanidation characteristics) and thick zones of mineralisation encompassed in a single, large deposit, with the potential for a low stripping ratio, efficient bulk mining process and a cost-effective gravity gold focused circuit. 5 SATURN METALS LIMITED – ANNUAL REPORT 2021 REVIEW OF OPERATIONS (Cont.) Work carried out at Apollo Hill during the first half of the financial year focused on drilling to produce a successful resource upgrade which was published in January 2021. This resource upgrade delivered: An additional 163koz since the previous resource estimation to an Inferred & Indicated Mineral Resource of 35.9Mt at 0.8g/t Au for 944,000 ounces of gold reported above a cut- off of 0.4g/t Au; Provided the conversion of 59% of the deposit to the higher confidence Indicated Mineral Resource category; and The quality of the Mineral Resource was lifted by publishing for the first time, within an optimised open pit shell1 (Figure 2). Figure 2 – 3D Representation of the January 2021 Apollo Hill Mineral Resource model and selected pit shell; view looking NW highlights width and robust nature of mineralisation. SATURN METALS LIMITED – ANNUAL REPORT 2021 6 REVIEW OF OPERATIONS (Cont.) Leverage, Quality, Growth and Differentiation Following on from our successful first half year drilling campaign, and Mineral Resource estimation process, the Company focused on further enhancing the Apollo Hill Gold Deposit by employing several distinct tactics. These included: Targeting higher grade shoots with drilling in leverage positions under the open pit shell; A grade control style drill program to test for further enhancement in the continuity of mineralised zones; An extensional drill program focused at the southern end of the deposit on the Ra Tefnut corridor; and The commencement of a major metallurgical program to further differentiate Apollo Hill’s simple mineral processing opportunities. During the year Saturn progressed exploration with its most aggressive drilling campaign since the Company’s inception. At Apollo Hill, the company completed: • • 463 Reverse Circulation (RC) Drill Holes for 79,477m of drilling; And collected 27 tonnes of composite sample for metallurgical testing program. View of drill rig to the East of Apollo Hill – June 2021 7 SATURN METALS LIMITED – ANNUAL REPORT 2021 REVIEW OF OPERATIONS (Cont.) Subsequent to the January 2021 Resource upgrade the Company has returned some of the most promising intersections in the History of the deposit - which will be included in the next Mineral Resource upgrade planned for early 2022 after the return of and incorporating metallurgical program results. Leverage – strong grades in pivotal positions Multiple higher-grade intersections were returned underneath and adjacent to the Apollo Hill Mineral Resource Whittle pit shell1 (Figure 3). Results included: o o o o 12m @ 5.75g/t Au from 2m including 8m @ 8.83g/t Au from 6m – AHRC0480 2m @ 63.05g/t Au from 8m – AHRC0479 8m @ 4.28g/t Au from 72m including 4m @ 8.34g/t Au from 72m – AHRC0477 15m @ 2.09g/t Au from 79m including 7m @ 3.84g/t Au from 87m – AHRC0502 Quality – demonstrated improvements Resource (Grade Control Style) Infill drilling demonstrated improvements in strip ratio potential, mineralisation continuity, understanding of mineralisation controls and localised grade opportunities (Figure 4). Excellent near surface intersections included: o o o o 54m @ 3.72g/t Au from 43m including 33m @ 5.80g/t Au from 49m – AHRC0618 12m @ 5.79g/t Au from 22m – AHRC0535 45m @ 1.58g/t Au from 0m including 14m @ 2.88g/t Au from 0m – AHRC0590 65m @ 0.96g/t Au from 43m including 25m @ 1.7g/t Au from 48m inc. 8m @ 3.13g/t Au from 57m – AHRC0610 Growth – successful step out drilling significantly extends the Apollo Hill gold system Step out intersections have extended the Apollo Hill gold system with several near surface gold intersections returned in a 1.4km long and broad corridor between Ra and Tefnut immediately south of Apollo Hill. Significant intersections include: o o o o o o o o o 8m @ 9.47g/t Au from 102m including 3m @ 24.92g/t Au from 102m – AHRC0647 19m @ 1.18g/t Au from 26m including 10m @ 2.01g/t Au from 26m – AHRC0621 21m @ 1.82g/t Au from 57m – AHRC0646 10m @ 4.00g/t Au from 89m including 5m @ 7.00g/t Au from 94m – AHRC0766 23m @ 1.74g/t Au from 63m including 8m @ 3.20g/t Au from 49m – AHRC0690 8m @ 3.39g/t Au from 73m – AHRC0705 13m @ 3.60g/t Au from 141m including 8m @ 5.62g/t Au from 141m – AHRC0709 18m @ 2.72g/t Au from 89m including 9m @ 4.71g/t Au from 95m – AHRC0774 10m @ 2.34g/t Au from 136m including 5m @ 4.42g/t Au from 140m - AHRC0768 Growing Footprint and Scalability of the Apollo Hill Deposit and Drilling Program – June 2021 (View looking North-West) SATURN METALS LIMITED – ANNUAL REPORT 2021 8 REVIEW OF OPERATIONS (Cont.) e c r u o s e r n r e t s a e e h t h t a e n e b n o i t i s o p l i a n o s n e t x e w o l l a h s a n i n e e s e r a ) 2 0 5 0 C R H A ( m 7 8 m o r f u A t / g 4 8 . 3 @ m 7 g n d u c n i l i m 9 7 m o r f u A t / g 0 9 . 2 @ m 5 1 . l l a w l l e h s t i p . s t l u s e r l l i r d t n e c e r f o 1 a - a n o i t c e s s s o r c l l a c i g o o e g d e i f i l i p m S – 3 e r u g F i ' s y n a p m o C e h t n o d e h s i l b u p s a s t n e m e c n u o n n A X S A d e t i l i m L s a t e M n r u t a S n i t x e t n o c r e l l u f n i d e t r o p e r y l l i a n g i r o s a s t l u s e r n o i t a r o p x e c i r o t s h d n a s t l l i u s e r n o i t l a r o p x e s n a i t n o c m a r g a d s h T i i ) a ( . d e t o n s t l u s e r n o n o i t a m r o f n i e h t s t c e f f a y l l a i r e t a m t a h t a t a d r o n o i t a m r o f n i w e n y n a f o e r a w a t o n s i t i t a h t s m r i f n o c d e t i m L i l s a t e M n r u t a S . e t i s b e w s a h c u s s t l u s e r g n o r t S . t i s o p e d l l i H o l l o p A e h t f o a e r a l a r t n e c e h t n i s t l u s e r l l i f n i d n a l i a n o s n e t x e f o n o i t c e s - s s o r c l i l a c g o o e g d e i f i l i p m s a s w o h s 3 e r u g F i 9 SATURN METALS LIMITED – ANNUAL REPORT 2021 REVIEW OF OPERATIONS (Cont.) A generalised cross section of the drill areas ‘before’ the drill program (data set as used for the latest resource upgrade in early January 2021 – drill results up to 13 November 2020), and ‘after’ the recent drill program is shown in Figure 4. The ‘after’ picture highlights a visible improvement in mineralisation continuity. In addition, the ratio of mineralised material to non-mineralised material has visually improved in the ‘after’ image. Based on this, Saturn believes there is clear potential to improve the stripping ratio in future Whittle pit optimisations compared to the January 2021 Resource pit shell. Figure 4 – Mineralisation cross section – before and after trial grade control/ drill density program. (a) This diagram contains exploration results and historic exploration results as originally reported in fuller context in Saturn Metals Limited ASX Announcements as published on the Company's website. Saturn Metals Limited confirms that it is not aware of any new information or data that materially affects the information on results noted. SATURN METALS LIMITED – ANNUAL REPORT 2021 10 REVIEW OF OPERATIONS (Cont.) Figure 5 shows extensional results in plan view. Results illustrate strong, +1km long and widening extensional Southern Apollo Hill corridor between the previous Mineral Resource Open Pit Shells. Figure 5 – Resource extension drilling results and holes for which assays remain pending relative to the published resource. (a) This diagram contains exploration results and historic exploration results as originally reported in fuller context in Saturn Metals Limited’s ASX Announcements as published on the Company's website. Saturn Metals Limited confirms that it is not aware of any new information or data that materially affects the information on results noted. 11 SATURN METALS LIMITED – ANNUAL REPORT 2021 REVIEW OF OPERATIONS (Cont.) Regional Exploration Activities Identify New Gold Systems During the year the Company commenced a major regional drilling campaign following on from previous years preparatory geophysical surveys and heritage clearance phases. Results from 237 Aircore (AC) holes (12,413m) drilled at several regional prospects were returned. Several promising areas were identified. In addition, results were returned from 9 exploratory RC holes (1,374m) drilled at Erebus approximately 4km south of Apollo Hill. 237 AC drill holes for 12,413m of drilling; and 134 geochemical samples. Broad spaced AC drilling at Atlanta highlighted several Au intersections (up to 4m @ 0.82g/t Au – AHAC0241) with associated pathfinder enrichment (including - Ag, As, Bi and W) (Figure 6). Similarly, 1.8km spaced AC drill lines (with 200m spacing between holes on the line) at Aphrodite (Figure 6) highlighted significant gold intercepts including 8m @ 0.56g/t Au from surface, including 4m @ 0.99g/t Au from 4m. At Erebus, Figure 6, a significant intersection of 1m @ 1.44g/t Au was noted in hole AHRC0702 at the northern end of an interpreted geological feature. Follow up drilling is underway subsequent to the financial year end, with assays pending. Figure 6 – Gold anomalism at Atlanta and the E31/1076 Area. (a) This diagram contains exploration results and historic exploration results as originally reported in fuller context in Saturn Metals Limited ASX Announcements as published on the Company's website. Saturn Metals Limited confirms that it is not aware of any new information or data that materially affects the information on results noted. SATURN METALS LIMITED – ANNUAL REPORT 2021 12 REVIEW OF OPERATIONS (Cont.) West Wyalong Farm-In Gold Joint Venture Late in June 2021, Saturn commenced its maiden diamond drill program at its West Wyalong Gold Project in New South Wales. The initial focus of exploration is the 2km long high-grade Mallee Bull Reef within the long forgotten West Wyalong Goldfield. No underground development or modern exploration is known to have occurred on the Mallee Bull Reef line since 1915 when a decline in production was synchronous with the onset of World War One. Saturn’s program is the first modern test of this excellent opportunity. By the financial year end the Company had completed half of the first hole of a 2,200m, four hole planned diamond drilling program designed to target high grade plunge extensions from where historic face samples of over 155 g/t Au (5oz per tonne) and multiple lodes are noted (Figure 7). Figure 7 – 3D Representation of planned and completed drill holes relative to old workings, key mineralisation plunges and very high-grade historic face sample data diagram adapted from references as fully outlined in Saturn ASX Announcement dated 21 June 2021. Corporate Well Funded for Progress During the year the Company undertook a capital raise to ensure funding capacity to continue progressing its Apollo Hill Gold Project and exploration at its regional prospective tenure. The raising was completed through a brokered placement and non-brokered direct placement to both institutional and sophisticated investors. The raising was as follows: 22 September 2020, the Company raised $12,582,664 (net of costs) by issuing 24,511,830 shares at 67 cents per share. At the year ended 30 June 2021, the Company has 112,614,510 shares on issue, and retained a healthy cash balance of $8,155,144. 13 SATURN METALS LIMITED – ANNUAL REPORT 2021 DIRECTOR’S REPORT The Directors present their report together with the consolidated financial statements of the Group comprising of Saturn Metals Limited (“Saturn” the “Group” or the “Company”) and its subsidiary for the financial year ended 30 June 2021 and the auditor’s report thereon. Directors The names and particulars of the Group’s Directors during the financial year, and up to the date of this report are as follows: NAME PARTICULARS Ian Bamborough BSc(Hons), MSc, MBA, MAIG, GAICD Appointed 19 September 2017 Brett Lambert BAppSc (Mining Engineering) Appointed 9 April 2020 Managing Director Mr Bamborough is a geologist with more than 25 years leadership experience in the mining industry. Mr Bamborough developed his career with Newmont Mining Corporation and was more recently Managing Director of ASX listed Spectrum Rare Earths Limited. Mr Bamborough has previously served as a Director of the Northern Territory Mining Board, and currently holds directorships with private exploration and mining company, Reef Mining Pty Ltd. The Board does not consider Mr Bamborough to be an independent Director. Other current ASX listed company directorships: None. Former ASX listed company directorships in the last three years: None. Non-Executive Chairman Mr Lambert is a mining engineer and experienced company director. He has over 35 years’ involvement in the Australian and international resources industry encompassing exploration, mining operations, project development, business development and corporate administration. Mr Lambert commenced his professional career with Western Mining Corporation in Kalgoorlie and progressed to a Senior Management role. Since leaving WMC, Mr Lambert has held executive positions with a number of junior and mid-tier than 10 years at CEO/managing director level. The Board considers that Mr Lambert is an independent Director. resource companies, including more Other current ASX listed company directorships: Non-Executive Chairman of Mincor Resources NL (1 January 2017 to present). Non-Executive Director of Australian Potash Limited (9 May 2017 to present). Non-Executive Director of Musgrave Minerals Ltd (4 February 2021 to present). Non-Executive Chairman of Metal Hawk Limited (3 July 2019 to present) Former ASX listed company directorships in the last three years: Non-Executive Director of Metals X Limited (resigned 10 July 2020) Non-Executive Director of De Grey Mining Limited (resigned 22 July 2019). SATURN METALS LIMITED – ANNUAL REPORT 2021 14 DIRECTORS’ REPORT (Cont.) NAME PARTICULARS Robert Tyson B.App Sc(Geol), GradDip Applied Finance(SIA) MAusIMM Appointed 2 June 2017 Non-Executive Director Mr Tyson is a geologist with more than 20 years resources industry experience having worked in exploration and mining-related roles for companies including Cyprus Exploration Pty Ltd, Queensland Metals Corporation NL, Murchison Zinc Pty Ltd, Normandy Mining Ltd and Equigold NL. Mr Tyson is the Managing Director of Peel Mining Limited, a role he has held for 14 years. The Board considers that Mr Tyson is not an independent Director. Other current ASX listed company directorships: Managing Director of Peel Mining Limited (20 April 2006 to present). Former ASX listed company directorships in the last three years: None. Andrew Venn BBus, GradDip Applied Finance, FFin Appointed 29 September 2017 Non-Executive Director Mr Venn has over 20 years mining industry experience and currently holds a senior executive position with DDH1 Drilling Pty Ltd, a major mining contractor. Mr Venn has previously held senior positions across financing and operations for Argonaut Limited, Orica Mining Services and ICI Explosives and is a Fellow of the Financial Services Institute of Australia. The Board considers that Mr Venn is an independent Director. Other current ASX listed company directorships: Adrian Goldstone BSc, MSc (Hons) Appointed 20 May 2021 None. Former ASX listed company directorships in the last three years: None. Non-Executive Director Mr Goldstone has in excess of 35 years’ experience in the resources industry holding executive roles over much of that time and has more recently become involved in specialist investment and financing for the resources industry. He currently holds the position of Managing Director, Technical at Dundee Goodman Merchant Partners. He brings expertise and successful experience in Project Management and associated governance processes, environmental management, and social licence in the industry and has a strong focus on creative business solutions meeting the expectations of multiple stakeholders. The Board considers that Mr Goldstone is an independent Director. Other current ASX listed company directorships: Non-Executive Director of Zinc of Ireland (29 January 2019 to present). Non-Executive Director of Big River Gold (26 May 2021 to present). Former ASX listed company directorships in the last three years: None. Company Secretary Natasha Santi Mrs Santi was appointed Company Secretary on 3 May 2021, after commencing as a full-time employee of Saturn on 11 January 2021. Mrs Santi previously had 9 years’ experience, as an employee of Boden Corporate Services Pty Ltd, providing company secretarial and accounting services to a range of ASX listed and unlisted companies, including serving as Company Secretary at Capricorn Metals Ltd from July 2012. In 15 SATURN METALS LIMITED – ANNUAL REPORT 2021 DIRECTORS’ REPORT (Cont.) addition, from April 2017, Mrs Santi was a full-time employee at Capricorn Metals Ltd until her resignation as Company Secretary, February 2020. Ryan Woodhouse Mr Woodhouse was appointed Company Secretary on 6 June 2017. Mr Woodhouse has 14 years of experience in the mining and energy industries in the area of accounting and governance. He holds a Bachelor of Commerce from Curtin University and is a member of the Institute of Chartered Accountants. Mr Woodhouse currently holds the position of Company Secretary with Peel Mining Limited. Mr Woodhouse resigned as Company Secretary on 3 May 2021. Principal Activities The principal activity of the Group is the exploration for economic deposits of precious metals. For the period of this report, the emphasis has been gold focused exploration near Leonora, in Western Australia. Dividends Paid or Recommended No dividends were paid or proposed to be paid during the financial year (2020: Nil). Operating Results The loss for the Group for the financial year after providing for income tax amounted to $1,959,350 (2020: $1,476,067). Loss per share $0.02 (2020: $0.02). Financial Position The net assets of the Group for the year ended 30 June 2021 were $29,452,890 (2020: $17,360,206). Net assets have increased due to share issues completed during the year which raised $13,791,564, net of costs for further exploration activities. In addition, a further $9,613,656 was capitalised as exploration and evaluation costs. At 30 June 2021 the closing cash balance of the Group was $8,155,144 (2020: $5,131,938). Review of Operations During the 2021 financial year the Company progressed exploration and resource development across it’s Apollo Hill Gold Project by completing a total of: • • • 463 Reverse Circulation (RC) Drill Holes for 79,477m of drilling; 237 Aircore (AC) Drill Holes for 12,413m of drilling, and; 134 geochemical samples. In early 2021 the Company delivered a major resource upgrade at the Apollo Hill Gold Deposit – the details of which can be found in the Company’s announcement to the ASX on 29 January 2021. During the period the Company secured a two additional exploration licenses finishing the year with exploration & mining licences totalling 1,038km2 at the Apollo Hill Project. In addition, the Company secured 16 miscellaneous licenses (459km2) for search for ground water next to its’ Apollo Hill Project. In June 2021 the Company commenced exploration diamond drilling at its West Wyalong Gold Joint Venture in New South Wales and progressed the first hole to 238m by year end. In addition, Saturn secured a wholly owned exploration licence at West Wyalong covering an area of 54km2 sitting adjacent to the Joint Venture area. SATURN METALS LIMITED – ANNUAL REPORT 2021 16 DIRECTORS’ REPORT (Cont.) Significant Changes in the State of Affairs Other than as set out below and elsewhere in the report, there were no significant changes to the state of affairs. Impact of COVID-19 During the year, in response to the COVID-19 pandemic, the Group moved to implement a series of precautionary measures as part of its OHS policies to ensure that risk around COVID-19 was minimised for all employees and contractors. The Group’s head office staff temporarily moved to a work-from- home basis as required throughout the year in line with government guidelines. Besides the aforementioned, site operations were not affected during this period. Changes to Contributed Equity During the year the Group increased contributed equity by $13,382,664 through the issue of 24,511,830 shares in the Group as part of a placements to institutional and sophisticated investors and the exercise of unquoted options held by Directors. The details and timing of each raising were as follows: 22 September 2020, the Group raised $12,582,664 (net of costs) by issuing 20,511,830 shares at 67 cents per share by placement to institutional and sophisticated investors; and 7 April 2021, the Group raised $800,000 by issuing 4,000,000 shares at 20 cents per share on the exercise of options held by Directors. Details of changes in contributed equity is disclosed in Note 12 in the consolidated financial statements. The Directors are not aware of any other significant changes in the state of affairs of the Company occurring during the financial year, other than disclosed in this report. Events Occurring Subsequent to Balance Date There were no other matters or circumstances that have arisen since the end of the financial period which significantly affected or may significantly affect the operations of the Group, the results of those operations or the state of affairs of the Group in future financial years. Likely Developments and Expected Results It is the Board’s current intention that the Group will progress exploration on current projects. Exploration is inherently risky and there are no certainties that the Group will successfully achieve its objectives. Meetings of Directors The number of meetings of Director’s (including committees of Directors) held during the year and the number of meetings attended by each director was as follows: Directors Meetings Audit & Risk Committee Director I Bamborough B Lambert R Tyson A Venn A Goldstone (1) Number of meetings eligible to attend 9 9 9 9 1 Number of meetings attended Number of meetings eligible to attend Number of meetings attended 9 9 8 9 1 1 1 1 1 - 1 1 1 1 - Note: (1) Mr Goldstone was appointed as a director on 20 May 2021. 17 SATURN METALS LIMITED – ANNUAL REPORT 2021 DIRECTORS’ REPORT (Cont.) Committee Membership On 22 September 2020, the Board formed an Audit & Risk Committee comprising all directors as appointed at that time. Director A Venn I Bamborough B Lambert R Tyson A Goldstone Position Chairman Member Member Member Member Appointment Date 22 September 2020 22 September 2020 22 September 2020 22 September 2020 3 June 2021 Directors’ Interests in Shares, Options and Performance Rights Directors’ interests in shares, options and performance rights as at the date of this report are set out in the table below. Director Ian Bamborough Brett Lambert Robert Tyson Andrew Venn Adrian Goldstone Shares Directly and Indirectly Held 4,663,941 - 1,210,000 818,000 14,500 Options 400,000 - 400,000 400,000 - Performance Rights 388,000 - 250,000 250,000 - REMUNERATION REPORT (AUDITED) This report details the nature and amount of remuneration for each Key Management Personnel (“KMP”) of Saturn Metals Limited. The remuneration report is structured as follows: a) Key management personnel covered in this report b) Principles used to determine the nature and amount of remuneration c) Key personnel remuneration d) Service agreements e) Equity issued as part of remuneration f) Option holdings of key management personnel g) Performance rights holdings of key management personnel h) Share holdings of directors and key management personnel, and i) Additional information a) Key management personnel covered in this report Key Management Personnel Ian Bamborough Brett Lambert Robert Tyson Andrew Venn Adrian Goldstone Position Managing Director Non-Executive Chairman Non-Executive Director Non-Executive Director Non-Executive Director Changes during the year - - - - Appointed 20 May 2021 There have been no changes to KMP since 30 June 2021 and to the date of this report. SATURN METALS LIMITED – ANNUAL REPORT 2021 18 REMUNERATION REPORT (AUDITED) (Cont.) b) Principles used to determine the nature and amount of remuneration The objective of the remuneration framework of Saturn Metals Limited is to ensure reward for performance is competitive and appropriate for the results delivered. The framework aligns executive reward with achievement of strategic objectives and the creation of value for shareholders. The Board believes that executive remuneration satisfies the following key criteria: competitiveness and reasonableness acceptability to shareholders performance linkage / alignment of executive compensation transparency capital management These criteria result in a framework which can be used to provide a mix of fixed and variable remuneration, and a blend of short and long-term incentives in line with the Group’s remuneration policy. Board and senior management The remuneration of the Managing Director will be decided by the Board, without the affected Executive Director participating in that decision-making process. The total maximum remuneration of Non-Executive Directors was initially set by the Constitution and subsequent variation is by ordinary resolution of Shareholders in general meeting in accordance with the Constitution, the Corporations Act and the ASX Listing Rules, as applicable. The current amount has been set at an amount not to exceed $300,000 per annum. The determination of Non-Executive Directors’ remuneration within that maximum is made by the Board having regard to the inputs and value to the Group of the respective contributions by each Non-Executive Director. In addition, a Director may be paid fees or other amounts (i.e. subject to any necessary Shareholder approval, non-cash remuneration such as Options) as the Directors determine where a Director performs special duties or otherwise performs services outside the scope of the ordinary duties of a Director. Directors are also entitled to be paid reasonable travelling, hotel and other expenses incurred by them respectively incurred in the performance of their duties as Directors. The Board reviews and approves the remuneration policy to enable the Group to attract and retain executives and Directors who will create value for Shareholders having consideration to the amount considered to be commensurate for a company of its size and level of activity as well as the relevant Directors’ time, commitment, and responsibility. The Board is also responsible for reviewing any employee incentive and equity-based plans including the appropriateness of performance hurdles and total payments proposed. Senior management are paid based on applicable market rates. Company Performance The following table shows the gross revenue, profits, dividends and share price at the end of the financial year for the past 4 years since Saturn listed on the ASX in March 2018, ending 30 June: Revenue Net profit/(loss) Share price at year end Dividends paid 2018 $ 27,334 (857,320) 0.16 - 2019 $ 80,126 (1,187,119) 0.300 - 2020 $ 74,974 (1,476,067) 0.715 - 2021 $ 72,592 (1,959,350) 0.410 - Remuneration is not linked to past Group performance but rather towards generating future shareholder wealth through share price performance. The Board and management may be issued share options in the company on a periodic basis as a means to link executive rewards to shareholder value. 19 SATURN METALS LIMITED – ANNUAL REPORT 2021 REMUNERATION REPORT (AUDITED) (Cont.) c) Key management personnel remuneration Details of the nature and amount of each element of the remuneration of each key management person of the Group during the year ended 30 June 2021 is set out in the following table: Key Management Person Directors I Bamborough B Lambert R Tyson A Venn A Goldstone Total Short-Term Employment Benefits Cash salary & fees $ Post- Employment Super- annuation $ Long-Term Benefits Leave benefits $ Share Based Payment Options $ Performance Rights $ Total $ Performance Related % 253,216 70,000 50,000 50,000 5,780 428,996 24,508 6,650 4,750 4,750 549 41,207 18,749 - - - - 18,749 15,469 - (10,522) (10,522) - (5,575) 117,919 - 44,314 44,314 - 206,547 429,861 76,650 88,542 88,542 6,329 689,924 31% - 38% 38% - Key management personal remuneration for the year ended 30 June 2020 is set out in the following table: Key Management Person Directors I Bamborough B Lambert R Tyson A Venn Total Short-Term Employment Benefits Cash salary & fees $ Post- Employment Super- annuation $ Long-Term Benefits Leave benefits $ Share Based Payment Options $ Performance Rights $ Total $ Performance Related % 187,300 15,167 48,333 48,333 299,133 23,268 1,441 4,592 4,592 33,893 - - - - - 127,584 - 53,610 53,610 234,804 24,768 - 24,767 24,767 74,302 362,920 16,608 131,302 131,302 642,132 42% - 60% 60% d) Service agreements Remuneration and other terms of employment for the Directors and key management personnel, except those of non-executive Directors are formalised in Employment Agreements or Letters of Offer. Details of the employment conditions for Directors and key management personnel are set out below: The Company has entered into an Executive Services Agreement with Mr Ian Bamborough pursuant to which Mr Bamborough was appointed Managing Director of the Company on the following terms: a) The Managing Director is employed on a full time on basis; b) The Company will pay to the Managing Director for services rendered a salary of $275,000 (excluding superannuation) per annum; c) The Company will reimburse the Managing Director for all reasonable expenses (including travel and accommodation) incurred in the performance of his duties; d) The Company may terminate the executive services agreement without reason on three (3) months’ notice thereafter and immediately without notice in the event of serious misconduct; e) The Managing Director may terminate the executive services agreement at any time and without notice if the Company commits a serious breach of the executive service agreement or by giving three (3) months’ notice to the Company; and f) The Company has entered into a deed of insurance, indemnity and access with Mr Bamborough. The Company has taken out and will use its best endeavours to maintain appropriate directors’ and officers’ liability insurance. The above Executive Service Agreement otherwise contains terms and conditions which are considered standard for agreements of their nature, including those relating to confidentiality, non-disclosure and assignment. SATURN METALS LIMITED – ANNUAL REPORT 2021 20 REMUNERATION REPORT (AUDITED) (Cont.) The Company has entered into an appointment letter with Mr Brett Lambert pursuant to which Mr Lambert was appointed Non-Executive Chairman of the Company on the following terms: a) Mr Lambert’s appointment commenced on 9 April 2020 and automatically ceases at the end of any meeting at which he is not re-elected as a Director by the shareholders of the Company or otherwise ceases in accordance with the Constitution; b) The Company will pay $70,000 per annum (excluding superannuation) to the Non-executive Chairman monthly in arrears. Remuneration shall be subject to annual review by the Board of the Company and approval by the shareholders of the Company (if required); c) The Company will reimburse Mr Lambert for all reasonable expenses (including travel and accommodation) incurred in the performance of his duties where agreed by the Board; and d) The Company has entered into a deed of insurance, indemnity and access with Mr Lambert. The Company has taken out and will use its best endeavours to maintain appropriate directors’ and officers’ liability insurance. The appointment letter otherwise contains terms and conditions that are considered standard for agreements of this nature. The Company has entered into an appointment letter with Robert Tyson pursuant to which Mr Tyson was appointed Non-Executive Director of the Company on the following terms: a) Mr Tyson’s appointment commenced on 9 April 2020 and automatically ceases at the end of any meeting at which he is not re-elected as a Director by the shareholders of the Company or otherwise ceases in accordance with the Constitution; b) The Company will pay $50,000 per annum (excluding superannuation) to the non-executive Director monthly in arrears. Remuneration shall be subject to annual review by the Board of the Company and approval by the shareholders of the Company (if required); c) The Company will reimburse Mr Tyson for all reasonable expenses (including travel and accommodation) incurred in the performance of his duties where agreed by the Board; and d) The Company has entered into a deed of insurance, indemnity and access with Mr Tyson. The Company has taken out and will use its best endeavours to maintain appropriate directors’ and officers’ liability insurance. The appointment letter otherwise contains terms and conditions that are considered standard for agreements of this nature. The Company has entered into an appointment letter with Andrew Venn pursuant to which Mr Venn was appointed Non-Executive Director of the Company on the following terms: a) Mr Venn’s appointment commenced on 21 September 2017 and automatically ceases at the end of any meeting at which he is not re-elected as a Director by the shareholders of the Company or otherwise ceases in accordance with the Constitution; b) The Company will pay $50,000 per annum (excluding superannuation) to the non-executive Director monthly in arrears. Remuneration shall be subject to annual review by the Board of the Company and approval by the shareholders of the Company (if required); c) The Company will reimburse Mr Venn for all reasonable expenses (including travel and accommodation) incurred in the performance of his duties where agreed by the Board; and d) The Company has entered into a deed of insurance, indemnity and access with Mr Venn. The Company has also taken out and will use its best endeavours to maintain appropriate directors’ and officers’ liability insurance. The appointment letter otherwise contains terms and conditions that are considered standard for agreements of this nature. The Company has entered into an appointment letter with Adrian Goldstone pursuant to which Mr Goldstone was appointed Non-Executive Director of the Company on the following terms: 21 SATURN METALS LIMITED – ANNUAL REPORT 2021 REMUNERATION REPORT (AUDITED) (Cont.) a) Mr Goldstone’s appointment commenced on 20 May 2021 and automatically ceases at the end of any meeting at which he is not re-elected as a Director by the shareholders of the Company or otherwise ceases in accordance with the Constitution; b) The Company will pay $50,000 per annum (excluding superannuation) to the non-executive Director monthly in arrears. Remuneration shall be subject to annual review by the Board of the Company and approval by the shareholders of the Company (if required); c) The Company will reimburse Mr Goldstone for all reasonable expenses (including travel and accommodation) incurred in the performance of his duties where agreed by the Board; and d) The Company has entered into a deed of insurance, indemnity and access with Mr Goldstone. The Company has taken out and will use its best endeavours to maintain appropriate directors’ and officers’ liability insurance. The appointment letter otherwise contains terms and conditions that are considered standard for agreements of this nature. e) Equity issued as part of remuneration (i) Options Options over shares in Saturn may be granted under the Company’s Incentive Option Plan which was created in September 2017 and approved by the Board. The Incentive Option Plan is designed to provide long-term incentives for Eligible Participants to deliver long-term shareholder returns. Under the plan, the Board may from time to time, in its absolute discretion, make a written offer to any Eligible Participant to apply for Options, upon the terms set out in the Plan and upon such additional terms and conditions as the Board determines. An Option may be made subject to vesting conditions as determined by the Board in its discretion and as specified in the offer for the Option. Details of options over ordinary shares in the Company provided as remuneration to key management personnel of Saturn are set out below. When exercisable, each option is convertible into one ordinary share of Saturn. Further information on the options is set out in Note 22(a) to the consolidated financial statements. Key management person Directors I Bamborough B Lambert R Tyson A Venn A Goldstone Fair Value at Grant Date Options Granted During Year Options Vested During Year 2021 $ 2020 $ 2021 Number 2020 Number 2021 Number 2020 Number - - - - - 53,550 - 53,550 53,550 - - - - - - 250,000 - 250,000 250,000 - 1,150,000 - 150,000 150,000 - 1,000,000 - - - - The assessed fair value at grant date of options granted to the individuals is allocated equally over the period from grant date to vesting date. Shares under option, provided as remuneration to key management personnel and on issue as at the date of this report are set out in the following table. Grant Date 6 Dec 2018 9 Dec 2019 Total on Issue to Key Management Personnel Date Vested & Number Exercisable 450,000 6 Dec 2020: 450,000 options vested (continuous employment for 2 years) 750,000 Class A – Vesting measurement date 9 Dec 2021, 450,000 Class B – Vesting measurement date 9 Dec 2021, 300,000 Expiry Date Exercise Price Value per Option at Grant Date 6 Dec 2021 26.4 cents 15.4 cents 36.4 cents 21.1 cents 8 Dec 2022 36.4 cents 21.9 cents SATURN METALS LIMITED – ANNUAL REPORT 2021 22 REMUNERATION REPORT (AUDITED) (Cont.) (ii) Performance Rights Performance Rights in Saturn may be granted under the Incentive Performance Rights Plan which was approved by Shareholders at the 2018 Annual General Meeting. The Incentive Performance Rights Plan is designed to provide short-term incentives for Eligible Participants to deliver short- and long-term shareholder returns. A Performance Right may be made subject to vesting conditions as determined by the Board in its discretion and as specified in the offer for the Performance Right. A Performance Right will lapse upon the earlier to occur of: (i) an unauthorised dealing in the Performance Right; (ii) a vesting condition in relation to the Performance Right is not satisfied by its due date, or becomes incapable of satisfaction, unless the Board exercises its discretion to waive the vesting conditions and vest the Performance Right in the circumstances set out in paragraph; and (iii) unless the Board resolves, in its absolute discretion, to allow the unvested Performance Rights to remain unvested after the Relevant Person ceases to be an Eligible Participant. Details of performance rights provided as remuneration to key management personnel during the year, are set out below. When conditions attaching to the right are met, each performance right is convertible into one ordinary share of Saturn Metals Limited. Further information on the performance rights is set out in Note 22(b) to the consolidated financial statements. Key management person Directors I Bamborough B Lambert R Tyson A Venn A Goldstone Fair Value at Grant Date 2021 $ 2020 $ Performance rights granted during year 2020 2021 Number Number Performance rights vested during year 2020 2021 Number Number 249,096 - - - - 88,750 - 88,750 88,750 - 388,000 - - - - 250,000 - 250,000 250,000 - - - - - - - - - - - Performance rights provided as remuneration to key management personnel and on issue as at the date of this report are set out in the following table. Total on Issue to Key Management Personnel 750,000 Grant Date 9 Dec 2019 26 Nov 2020 388,000 Date Vested & Number Exercisable Expiry Date Exercise Price Fair value per Right at Grant Date Vest on achieving a resource of 1.5Moz at a minimum grade 0.8g/t at Apollo Hill & Ra deposits area/corridor by 9 Dec 2021. Class A – Vesting measurement date 21 Dec 2022: 75% vest of achievement of various performance hurdles. Class B – Vesting measurement date 21 Dec 2022: 25% vest of achievement of market- based performance hurdles. 8 Dec 2022 Nil 35.5 cents 70.0 cents 26 Nov 2023 Nil 46.8 cents The fair value of the rights is determined on the market price of the company’s shares at grant date, with an adjustment made to take into account the two-year vesting period. The Directors do not receive any dividends and are not entitled to vote in relation to the performance rights during the vesting period. 23 SATURN METALS LIMITED – ANNUAL REPORT 2021 REMUNERATION REPORT (AUDITED) (Cont.) f) Option holdings of key management personnel The following table shows a reconciliation of movements in options held by key management personnel during the year ended 30 June 2021. Balance at the start of the year Vested Granted Vested Unvested Number % Exercised Other Changes(2) Balance at the end of the year Vested & exercisable Unvested KMP & Grant Date I Bamborough 9 Mar 18 1,000,000 9 Mar 18 1,000,000 9 Mar 18 6 Dec 18 9 Dec 19 - - - 1,000,000 500,000 - 250,000 - R Tyson 9 Mar 18 6 Dec 18 9 Dec 19 500,000 - - - 500,000 250,000 A Venn 9 Mar 18 6 Dec 18 9 Dec 19 - 500,000 500,000 - 250,000 - 3,000,000 3,250,000 - - - - - 1,000,000 100 30 150,000 - - - - - - - - 150,000 - - 150,000 - - - - 1,450,000 - 30 - - 30 - (1,000,000) (1,000,000) (1,000,000) - - - - - (350,000) - - - - 150,000 - (500,000) - - - (350,000) - - 150,000 - (500,000) - - (4,000,000) (350,000) - (1,050,000) - 150,000 - 450,000 - - - - 250,000 - - 250,000 - - 250,000 750,000 Note: (1) No options are held by KMP Mr Brett Lambert or Mr Adrian Goldstone. (2) During the year 1,050,000 options lapsed and were subsequently cancelled after specific vesting conditions were not met by the required vesting date. g) Performance rights holdings of key management personnel Movements in performance rights held by key management personnel during the year ended 30 June 2021, are set out in the following table. Key management person Directors I Bamborough B Lambert R Tyson A Venn A Goldstone(1) Balance at the start of the year Granted Expired Converted to Shares Balance at end of the year Vested & exercisable Unvested 250,000 - 250,000 250,000 n/a 750,000 388,000 - - - - 388,000 - - - - - - - - - - - - 638,000 - 250,000 250,000 - 1,138,000 - - - - - - 638,000 - 250,000 250,000 - 1,138,000 Note: (1) Mr Adrian Goldstone was appointed as a director on 20 May 2021. h) Share holdings of Directors and key management personnel Movements in shares held by key management personnel during the year ended 30 June 2021, are set out in the following table. Key management personnel Balance at The start of the year Received during the year exercise of options Other changes during the year Closing balance Directors I Bamborough B Lambert R Tyson A Venn A Goldstone(1) 1,663,941 - 710,000 250,000 n/a 2,623,941 3,000,000 - 500,000 500,000 - 4,000,000 - - - 68,000 14,500 82,500 4,663,941 - 1,210,000 818,000 14,500 6,706,441 Note: (1) Mr Adrian Goldstone was appointed as a director on 20 May 2021 and held an existing shareholding in Saturn. SATURN METALS LIMITED – ANNUAL REPORT 2021 24 REMUNERATION REPORT (AUDITED) (Cont.) i) Additional information Other transactions with key management personnel Mr Robert Tyson: Non-Executive Director, Mr Robert Tyson is the Managing Director of Peel Mining Limited (“Peel Mining”) (ASX:PEX). In previous years Peel Mining has held a significant shareholding in the Company however they held no shares at 30 June 2021 (Jun 2020: 4.6%, Dec 2019: 27.33%). Although Peel Mining Limited is no longer a shareholder of Saturn, its Managing Director, Mr Rob Tyson, is also one of the Company’s Non-Executive Directors. The Company engaged Peel Mining Limited in a non- exclusive basis to perform and provide administrative & management services through a service agreement up to April 2021. Throughout the year, the Company made reimbursements for costs associated with management services to Peel Mining on an arm’s length commercial basis. The total of transactions with Peel Mining during the year was $183,502 (2020: $171,410). There was no outstanding balance owing at year-end (2020: $9,023). Mr Andrew Venn: Non-Executive Director, Mr Andrew Venn holds the position of Executive General Manager, Corporate Services at DDH1 Limited (previously Chief Operations officer of DDH1 Drilling Pty Ltd (“DDH1”). During the year the Company purchased drilling services from a subsidiary of DDH1 (Strike Drilling Pty Ltd). All transactions were on bona-fide arm’s length terms. The total of transactions with DDH1 during the year was $1,052,739 (2020: $nil). There was no outstanding balance owing at year-end (2020: $nil). Cash bonuses No cash bonuses have been paid by the Group to directors during the financial year (2020: Nil). Share-based compensation: options & performance rights Other than options and performance rights granted under the Incentive Option & Performance Rights Plan as described in (e) above, there were no other options issued to, or exercised by Directors of Saturn or key management personnel during the year. Use of remuneration consultants During the year ended 30 June 2021, the Group did not employ the services of a remuneration consultant to review its existing remuneration policies and to provide recommendations in respect of both executive short-term and long-term incentive plan design. Voting and comments made at the Company’s Annual General Meeting Saturn Metals Limited received 99.9% of “yes” votes from votes received on its remuneration report for the 2020 financial year. The Company did not receive any specific feedback at the AGM or throughout the year on its remuneration practices. End of Audited Remuneration Report 25 SATURN METALS LIMITED – ANNUAL REPORT 2021 DIRECTORS’ REPORT (Cont.) Shares under option Unissued ordinary shares of the Company under option at the date of this report are as follows: Grant date 6 December 2018 9 December 2019 26 June 2020 Expiry date 6 Dec 2021 8 Dec 2022 26 Jun 2022 Exercise price of options Number under option 26.4 cents 36.4 cents 70.0 cents 618,000 1,200,000 1,892,500 No option holder has any right under the options to participate in any other share issue of the Company. Shares issued on the exercise of options Date of Exercise 6 April 2021 6 July 2021 Issue price of shares 2020 2021 cents cents - 20.0 cents - 26.4 cents Number of shares issued 2021 Number 4,000,000 150,000 2020 Number - - Shares issued on the conversion of performance rights Date of Conversion n/a Issue price of shares 2020 2021 cents cents - - Number of shares issued 2021 Number - 2020 Number - Indemnification and Insurance of Directors and Officers During the financial year the Group paid a premium of $19,213 (2020: $14,622) to insure the Directors and officers of the Group. The policy indemnifies each Director and officer of the Group against certain liabilities arising in the course of their duties. Proceedings on behalf of the Group No person has applied for leave of court to bring proceedings on behalf of the Group or intervene in any proceedings to which the Group is a party for the purpose of taking responsibility on behalf of the Group for all or any part of those proceedings. The Group was not a party to any such proceedings during the year. Environmental Regulation The Group holds exploration licences and mining leases in Australia. These licences specify guidelines for environmental impacts in relation to exploration activities. The licence conditions provide for the full rehabilitation of the areas of exploration in accordance with the respective jurisdiction’s guidelines and standards. The Group is not aware of any significant breaches of the licence condition. Corporate Governance A summary of the Company’s corporate governance policies, practices and compliance with the ASX Corporate Governance Council’s Corporate Governance Principles and Recommendations (4th Edition) will be provided at the same time as the 2021 Annual Report. Auditor’s Independence Declaration A copy of the Auditor’s Independence Declaration as required under section 307C of the Corporations Act 2001 is included at the end of this financial report. Non-Audit Services The Group may decide to employ the auditor on assignments additional to their statutory audit duties where the auditor’s expertise and experience with the Group are important. The Board has considered the position and is satisfied that the provision of the 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 by the auditor as set out below did not compromise the auditor independence requirements of the Corporations Act 2001 for the following reasons: SATURN METALS LIMITED – ANNUAL REPORT 2021 26 DIRECTORS’ REPORT (Cont.) All non-audit services have been reviewed by the Board to ensure they do not impact the impartiality and objectivity of the auditor; and None of the services undermine the general principles relating to the auditor independence as set out in APEX 110 Code of Ethics for Professional Accountants. Details of the fees paid to the auditor during the year can be found at Note 23 of the notes to the consolidated financial statements. This report is made in accordance with a resolution of the Board of Directors and signed for on behalf of the Board by: Ian Bamborough Managing Director Perth, Western Australia 30 September 2021 27 SATURN METALS LIMITED – ANNUAL REPORT 2021 Auditor’s Independence Declaration As lead auditor for the audit of Saturn Metals Limited for the year ended 30 June 2021, I declare that to the best of my knowledge and belief, there have been: (a) no contraventions of the auditor independence requirements of the Corporations Act 2001 in relation to the audit, and (b) no contraventions of any applicable code of professional conduct in relation to the audit. This declaration is in respect of Saturn Metals Limited and the entities it controlled during the period. Helen Bathurst Partner PricewaterhouseCoopers Perth 30 September 2021 PricewaterhouseCoopers, ABN 52 780 433 757 Brookfield Place, 125 St Georges Terrace, PERTH WA 6000, GPO Box D198, PERTH WA 6840 T: +61 8 9238 3000, F: +61 8 9238 3999, www.pwc.com.au Liability limited by a scheme approved under Professional Standards Legislation. CONSOLIDATED STATEMENT OF PROFIT OR LOSS AND OTHER COMPREHENSIVE INCOME For the year ended 30 June 2021 Interest and other income Interest and other income Share-based remuneration Employee and Directors’ benefit expenses Administration expenses Finance costs Capitalised exploration expenditure expensed Loss before income tax Income tax benefit (expense) Note 2021 $ 2020 $ 14 22 15 9 10 16 72,592 72,592 74,974 74,974 (260,470) (956,255) (667,109) (3,122) (144,986) (456,178) (570,206) (524,657) - - (1,959,350) (1,476,067) - - Loss from continuing operations after income tax (1,959,350) (1,476,067) Other comprehensive income - - Total Loss and comprehensive income for the year attributable to the members of Saturn Metals Limited (1,959,350) (1,476,067) Earnings per share: Basic Loss per share for the year attributable to the members of Saturn Metals Limited 24 (0.02) (0.02) Diluted Loss per share for the year attributable to the members of Saturn Metals Limited 24 (0.02) (0.02) The above statement should be read in conjunction with the accompanying notes. 29 SATURN METALS LIMITED – ANNUAL REPORT 2021 CONSOLIDATED STATEMENT OF FINANCIAL POSITION As at 30 June 2021 Current Assets Cash and cash equivalents Trade and other receivables Other Current Assets Total Current Assets Non-Current Assets Trade and other receivables Property, plant & equipment Exploration & evaluation assets Total Non-Current Assets Total Assets Current Liabilities Trade and other payables Lease liabilities Total Current Liabilities Non-Current Liabilities Lease Liabilities Total Non-Current Liabilities Total Liabilities Net Assets Equity Contributed equity Accumulated losses Option reserve Total Equity Note 2021 $ 2020 $ 5 6 7 6 8 10 11 9 9 12 13 13 8,155,144 100,460 76,349 5,131,938 33,975 18,543 8,331,953 5,184,456 42,974 348,614 - 93,945 22,255,694 12,624,645 22,647,282 12,718,590 30,979,235 17,903,046 1,328,714 62,966 1,391,680 542,840 - 542,840 134,665 134,665 - - 1,526,345 542,840 29,452,890 17,360,206 33,265,409 19,882,745 (5,479,856) (3,520,506) 1,667,337 997,967 29,452,890 17,360,206 The above statement should be read in conjunction with the accompanying notes. SATURN METALS LIMITED – ANNUAL REPORT 2021 30 CONSOLIDATED STATEMENT OF CHANGES IN EQUITY For the year ended 30 June 2021 Contributed Equity $ Accumulated Losses $ Note Share Based Payment Reserve $ Option Reserve $ Total Equity $ Balance at 30 June 2019 12,132,001 (2,044,439) 541,789 - 10,629,351 Loss for the year Total comprehensive loss for the year 13 - - (1,476,067) (1,476,067) Issue of share capital 12 8,197,916 Share issue expenses 12 (447,172) Share based payments 13 - - - - - - - - 456,178 - - - - - (1,476,067) (1,476,067) 8,197,916 (447,172) 456,178 Balance at 30 June 2020 19,882,745 (3,520,506) 997,967 - 17,360,206 Loss for the year Total comprehensive loss for the year 13 - - (1,959,350) (1,959,350) Issue of share capital 12 14,542,926 Share issue expenses 12 (751,362) Share based payments 13 - Issue of options 13 (408,900) - - - - - - - - 260,470 - - (1,959,350) (1,959,350) - 14,542,926 - - (751,362) 260,470 - 408,900 - Balance at 30 June 2021 33,265,409 (5,479,856) 1,258,437 408,900 29,452,890 The above statement should be read in conjunction with the accompanying notes. 31 SATURN METALS LIMITED – ANNUAL REPORT 2021 CONSOLIDATED STATEMENT OF CASH FLOWS For the year ended 30 June 2021 Cash flows from operating activities Payments to suppliers and employees Government COVID Grant Net cash outflow from operating activities Cash flows from investing activities Payments for purchase of plant and equipment Payments for exploration expenditure Grant refunds Interest received Note 2021 $ 2020 $ 14 17 (1,419,508) (969,828) 50,000 50,000 (1,369,508) (919,828) (94,596) (9,258) (9,259,625) (4,472,185) - 22,592 3,827 33,471 Net cash outflow from investing activities (9,331,629) (4,444,145) Cash flows from financing activities Proceeds from issue of shares Transaction costs of issue of shares Repayment of lease liability Interest paid on lease liability Security deposit paid 14,542,926 (751,362) 8,197,916 (447,172) (21,125) (3,122) (42,974) - - - Net cash inflow from financing activities 13,724,343 7,750,744 Net increase in cash and cash equivalents Cash and cash equivalents at the start of year Cash and cash equivalents at the end of year 5 3,023,206 5,131,938 8,155,144 2,386,771 2,745,167 5,131,938 The above statement should be read in conjunction with the accompanying notes. SATURN METALS LIMITED – ANNUAL REPORT 2021 32 NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS 1. Significant Changes During the Year During the year Saturn has entered into two lease arrangements, the details of which are set out in Note 9. The principal accounting policies adopted in the preparation of the financial report are set out in the notes below, including Note 26. These policies have been consistently applied to all the years presented, unless otherwise stated. The financial report includes the consolidated financial statements for the Group at the end of, or during the financial year ended 30 June 2021 and the comparative period. 2. Subsidiary companies The consolidated financial statements incorporate the assets, liabilities and results of the following subsidiary in accordance with the accounting policy described in Note 26(b): Name Titan Metals Pty Ltd 3. Interests in other entities Country of Incorporation Australia Class of Shares Ordinary 2021 % 100.00 2020 % 100.00 Equity holding In April 2020 Saturn entered into a unincorporated joint venture arrangement, through its wholly owned subsidiary Titan Metals Pty Ltd, with Mr Peter Goldner and Dr Angus Collins. Saturn can earn up to 85% in the project through four farm-in stages by spending a total of $1.9 million on exploration over approximately 4 years and by making a total of $195,000 in staged progress payments (cash and or shares). Saturn must keep the tenements in good standing. On Saturn earning 85% a Incorporated Joint Venture will be formed and the Joint Venture Partners have the option to contribute or dilute (subject to the pre-negotiated dilution formula in line with previous earn in stages) to a combined 1.5% royalty. On the Joint venture Partners reverting to a royalty position Saturn must make an additional $50,000 progress payment. Saturn earns a transferrable interest in the tenement during the first three stages but does not maintain full commercial rights until having earned 60% by spending $900,000 on exploration. As at the time of this report and due to the early stage of the arrangement, Titan Metals Pty Ltd has not yet earnt an interest in the tenements under the agreement. The agreement does not constitute a Joint Arrangement under the Australian Accounting Standards. 4. Segment information Operating segments are reported in a manner consistent with the internal reporting provided to the chief operating decision maker. The chief decision maker has been identified as the Board of Directors. Management has determined that Saturn only has one segment, being exploration for precious metals at its tenement package, south of Leonora, Western Australia. Whilst the Company’s 100% owned subsidiary, Titan Metals Pty Ltd, has recently entered into a farm-in arrangement for the exploration of precious metals at West Wyalong, NSW, at this early stage of the arrangement Management does not feel the transactions are material enough to qualify as an additional segment. 33 SATURN METALS LIMITED – ANNUAL REPORT 2021 NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Cont.) 5. Cash & Cash Equivalents For statement of cash flows preparation purposes, cash and cash equivalents includes cash on hand and short-term deposits held at call (other than deposits used as cash backing for performance bonds) with financial institutions. Any bank overdrafts are shown within borrowings in the current liabilities on the consolidated statement of financial position. Cash at bank and in hand Refer to Note 18 for the policy on financial risk management. 6. Trade and other receivables 2021 $ 2020 $ 8,155,144 8,155,144 5,131,938 5,131,938 Trade receivables are amounts due from customers for goods sold or services performed in the ordinary course of business. They are generally due for settlement within 30 days and therefore are all classified as current. Trade receivables are recognised initially at the amount of consideration that is unconditional unless they contain significant financing components, when they are recognised at fair value. The group holds the trade receivables with the objective to collect the contractual cash flows and therefore measures them subsequently at amortised cost using the effective interest method. The Group applies the AASB 9 simplified approach to measuring expected credit losses which uses a lifetime expected loss allowance for all trade receivables. In determining the recoverability of a trade or other receivable using the expected credit loss model, the Group performs a risk analysis considering the type and age of the outstanding receivables, the creditworthiness of the counterparty, contract provisions, letter of credit and timing of payment. The carrying value less impairment provision of trade receivables and payables are assumed to approximate their fair values due to their short-term nature. The fair value of financial liabilities for disclosure purposes is estimated by discounting the future contractual cash flows at the current market interest rate that is available to the Group for similar financial instruments. No material provision for credit losses was required to be recognised in the current period ending 30 June 2021. Receivables (Current) GST recoverable from taxation authority Deposits paid Other receivables Refer to Note 18 for the policy on financial risk management. Receivables (Non-Current) Security deposits in relation to exploration tenements Security deposits in relation to office lease 2021 $ 85,954 1,232 13,274 100,460 2020 $ 33,975 - - 33,975 10,000 32,974 42,974 - - - SATURN METALS LIMITED – ANNUAL REPORT 2021 34 NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Cont.) 7. Other Current Assets Prepaid insurance Other prepayments 8. Property, Plant & Equipment Plant and equipment 2021 $ 25,103 51,246 76,349 2020 $ 18,543 - 18,543 All assets acquired, including plant and equipment are initially recorded at their cost of acquisition, being the fair value of the consideration provided plus incidental costs directly attributable to the acquisition. Plant and equipment include right-of use assets depreciated over the shorter of the asset’s useful life and the lease term on a straight-line basis as set out in Note 9. Depreciation on general plant and equipment is calculated using the straight-line method to allocate their cost or revalued amounts over their estimated useful lives from the time the asset is held ready for use as follows: 3-10 years - Plant 3-8 years - Vehicles 3-5 years - Office equipment - Computer software 3-5 years The assets’ residual values and useful lives are reviewed, and adjusted if appropriate, at the end of each reporting period. An asset’s carrying amount is written down immediately to its recoverable amount if the asset’s carrying amount is impaired. An item of plant and equipment is derecognised upon disposal or when no future economic benefits are expected from its use or disposal. Any gain or loss arising on de-recognition of the asset (calculated as the difference between net disposal proceeds and the carrying amount of the asset) is included in profit or loss in the year the asset is derecognised. Impairment of assets At each reporting date, the Group assesses whether there is any indication that an asset may be impaired. Where an indicator of impairment exists, the Group makes a formal estimate of recoverable amount. Where the carrying amount of an asset exceeds its recoverable amount the asset is considered impaired and is written down to its recoverable amount. Recoverable amount is the greater of fair value less costs of disposal and value in use. It is determined for an individual asset, unless the asset’s value in use cannot be estimated to be close to its fair value less costs of disposal and it does not generate cash inflows that are largely independent of those from other assets or groups of assets, in which case, the recoverable amount is determined for the cash- generating unit to which the asset belongs. No impairment losses have been recognised for the year ending 30 June 2021 (2020: $nil). As at 30 June 2021 Equipment Software Plant & Cost or fair value Accumulated depreciation Net carrying amount $ 42,846 (16,083) 26,763 $ 40,512 (26,700) 13,812 Furniture & Equipment $ 327,614 (46,401) 281,213 Vehicles $ 44,991 (18,165) 26,826 Total $ 455,963 (107,349) 348,614 35 SATURN METALS LIMITED – ANNUAL REPORT 2021 NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Cont.) Reconciliation for the year ended 30 June 2021 Equipment Software $ $ Plant & Furniture & Equipment $ Vehicles $ Total $ Carrying amount at 1 July Additions Depreciation expense Net carrying amount at 30 June 22,793 10,541 (6,571) 26,763 21,914 - (8,102) 13,812 16,789 301,580 (37,156) 281,213 32,449 - (5,623) 26,826 93,945 312,121 (57,452) 348,614 As at 30 June 2020 Cost or fair value Accumulated depreciation Net carrying amount 32,305 (9,512) 22,793 40,512 (18,598) 21,914 26,034 (9,245) 16,789 44,991 (12,542) 32,449 143,842 (49,897) 93,945 Reconciliation for the year ended 30 June 2020 Carrying amount at 1 July Additions Depreciation expense Net carrying amount at 30 June 25,608 3,258 (6,073) 22,793 30,017 - (8,103) 21,914 15,530 6,000 (4,741) 16,789 38,073 - (5,624) 32,449 109,228 9,258 (24,541) 93,945 9. Leases AASB 16 Leases eliminates the classifications of operating leases and finance leases for lessees. Except for short-term leases and leases of low-value assets, rights-of-use assets, capitalised in Property, Plant & Equipment (Note 8) and corresponding lease liabilities are recognised in the statement of financial position. The right-of-use asset is depreciated over the shorter of the asset’s useful life and the lease term on a straight-line basis, while the lease liability is reduced by an allocation of each lease payment. Payments associated with short-term leases and leases of low-value assets are recognised on a straight-line basis as an expense in profit or loss. (a) Amounts recognised in the statement of financial position: Right-of-use assets: Furniture & Equipment Office space Equipment Lease liabilities: Current Non-current Additions to the right-of-use assets during the year was $218,756. (b) Amounts recognised in the statement of profit or loss: Depreciation charge of right-of-use assets: Office space Equipment Interest expenses (included in finance costs) The total cash outflow for leases in 2021 was $24,247 (2020: $nil). 2021 $ 2020 $ 210,739 8,017 218,756 62,966 134,665 197,631 2021 $ 25,632 892 26,524 3,122 3,122 - - - - - - - - - - - 2020 $ SATURN METALS LIMITED – ANNUAL REPORT 2021 36 NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Cont.) Saturn leases office premises in West Perth, Western Australia under normal commercial lease arrangements. The office lease was entered into for an initial 3-year and 1-month period commencing 18 February 2021. 10. Exploration and evaluation assets All exploration and evaluation expenditure is capitalised under AASB 6 Exploration for and Evaluation of Mineral Resources. Mineral interest acquisition costs and exploration and evaluation expenditure incurred is accumulated and capitalised in relation to each identifiable area of interest. These costs are only carried forward to the extent that the Group’s right to tenure to that area of interest are current and either the costs are expected to be recouped through successful development and exploitation of the area of interest (alternatively by sale) or where areas of interest have not at reporting date reached a stage which permits a reasonable assessment of the existence or otherwise of economically recoverable reserves, and active, and significant operations are undertaken in relation to the area of interest. Amortisation is not charged on costs carried forward in respect of areas of interest in the exploration and evaluation phase or development phase until production commences. Grants (R&D Tax Incentive grant income /Co Operative Drill Funding) The Group accounts for funds received from the ATO under the Research and Development (“R&D”) Tax Incentive Scheme as an offset to the Exploration and Evaluation asset, where the initial expenses to which it relates were capitalised. No R&D incentives were received during 2021 (2020: $17,233). During 2020, the Group also received a refund through the Co-Operative Drill Funding scheme through the Western Australian Government. No equivalent grant refund was received in 2021 (2020 $3,827). These funds are also offset to the Exploration and Evaluation asset, where the initial expenses to which it relates were capitalised. At cost Reconciliation: Opening balance Exploration expenditure Impairment Grant Refund Closing balance 2021 $ 2020 $ 22,255,694 12,624,645 12,624,645 9,776,035 (144,986) - 22,255,694 8,176,971 4,451,501 - (3,827) 12,624,645 The recoverability of the carrying amount of the exploration and evaluation assets is dependent on the successful development and commercial exploitation, or alternatively the sale, of the respective areas of interest. 11. Trade and other payables These amounts represent liabilities for goods and services provided to the Group prior to the end of the financial year which are unpaid. The amounts are unsecured and are usually payable within 30 days of invoice. The carrying amounts of trade and other payables are considered the same as their fair values, due to their short-term nature. Trade payables Accrued expenses & other payables 2021 $ 888,971 439,743 1,328,714 2020 $ 174,375 368,465 542,840 37 SATURN METALS LIMITED – ANNUAL REPORT 2021 NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Cont.) 12. Contributed Equity 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. Incremental costs directly attributable to the issue of new shares or options for the acquisition of a business are not included in the cost of the acquisition as part of the purchase consideration. If the entity acquires its own equity instruments, e.g. as the result of a share buy-back, those instruments are deducted from equity and the associated shares are cancelled. No gain or loss is recognised in the profit or loss and the consideration paid including any directly attributable incremental costs (net of income taxes) are recognised directly in equity. (a) Share capital 2021 2020 Number of Shares Number of Shares $ $ Authorised & issued, ordinary shares fully paid 112,464,510 33,265,409 87,952,680 19,882,745 (b) Movements in ordinary share capital 2021 2020 Opening balance, 1 July Shares issued: On conversion of performance rights On exercise of options As a result of share placements Transferred to option revaluation reserve Transaction costs on share issues Closing balance, 30 June (c) Ordinary shares Number of Shares 87,952,680 19,882,745 63,642,859 12,132,001 Number of Shares $ $ - 800,000 - 4,000,000 - - 20,511,830 13,742,926 24,309,821 - (408,900) - (751,362) - - 8,197,916 - (447,172) 112,464,510 33,265,409 87,952,680 19,882,745 - - Ordinary shares entitle the holder to participate in dividends and the proceeds on winding up of the Group in proportion to the number of and amounts paid on the shares held. On a show of hands every holder of ordinary shares present at a meeting in person or by proxy, is entitled to one vote, and upon a poll each share is entitled to one vote. (d) Options & performance rights Information relating to options and performance rights issued during the year is set out in Note 22. (e) Capital risk management In employing its capital, the Group seeks to ensure that it will be able to continue as a going concern and in time provide value to shareholders by way of increased market capitalisation and/or dividends. In the current stage of its development, the Group has invested its available capital in acquiring and exploring mining tenements. As is appropriate at this stage, the Group is funded entirely by equity. As it moves forward to develop its tenements towards production, the Group will adjust its capital structure to support its operational and strategic objectives, by raising additional capital or taking on debt, as is seen to be appropriate from time to time given the overriding objective of creating shareholder value. In this regard, the Board will consider each step forward in the development of the Group on its merits and in the context of the then capital markets, in deciding how to structure funding arrangements. SATURN METALS LIMITED – ANNUAL REPORT 2021 38 NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Cont.) 13. Reserves and accumulated losses (i) Accumulated losses Opening balance Loss for the year Closing balance (ii) Share-based payments reserve Opening balance Option expenses (Director options) Option expenses (Employee options) Options lapsed (Director options) Options lapsed (Employee options) Net Performance rights (Directors rights) Net Performance rights (Employee rights) Closing balance (iii) Option reserve Opening balance Options issued to third party Closing balance Nature & Purpose of Reserve Share-based payments reserve: 2021 $ 3,520,506 1,959,350 5,479,856 997,967 156,598 77,943 (162,173) (114,603) 206,547 96,158 1,258,437 - 408,900 408,900 2020 $ 2,044,439 1,476,067 3,520,506 541,789 234,804 105,630 - - 74,302 41,442 997,967 - - - The share-based payment reserve represents the fair value of equity benefits provided to Directors and employees as part of their remuneration for services provided to the Group paid for by the issue of equity. Option reserve: On 26 June 2020 Saturn issued 1,892,500 free attaching options to a Third Party as part of a share placement. The issue of the options was subject to shareholder approval, which was granted on 8 August 2020, and Foreign Investment Review Board approval, which was granted on 17 November 2020. Given the uncertainty that that these approvals would be granted at the time of lodging the 30 June 2020 accounts, no value was separately recorded for those unissued free attaching options. Given both required approvals were received during the half year period and the issue of the options completed, the Group made a transfer for the value of the options out of the Contributed Equity account and recorded this value in an Option Reserve account. Note that total equity balance does not change with this adjustment. Reserve Movements Share options & reserve movements: 2021 2020 Opening balance Options issued to Directors Options issued to Employees Exercised Lapsed Closing balance Options $ Options $ 7,760,000 - - (4,000,000) (1,792,000) 1,968,000 882,223 6,560,000 750,000 156,598 450,000 77,943 - - - (276,776) 839,988 7,760,000 541,789 234,804 105,630 - - 882,223 39 SATURN METALS LIMITED – ANNUAL REPORT 2021 NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Cont.) Number Exercisable at 26.4 cents; vesting on or before 6 Dec 21 Exercisable at 26.4 cents; vesting on or before 6 Dec 21 Exercisable at 20 cents; vesting on 9 Mar 2019 Exercisable at 20 cents; vesting on 9 Mar 2020 Exercisable at 20 cents; vesting on 9 Mar 2021 Exercisable at 36.4 cents; vesting on or before 8 Dec 2022 Exercisable at 36.4 cents; vesting on or before 8 Dec 2022 2020 2021 450,000 1,500,000 318,000 1,060,000 - 2,000,000 - 1,000,000 - 1,000,000 750,000 450,000 1,968,000 7,760,000 750,000 450,000 The expected life of the options is based on historical data and is not necessarily indicative of exercise patterns that may occur. The expected volatility reflects the assumption that the historical volatility is indicative of future trends, which may also not necessarily be the actual outcome. No other features of options granted were incorporated into the measurement of fair value (Note 22(a)). Third party options & reserve movements: 2021 2020 Opening balance Options issued to Third Party Closing balance Options - 1,892,500 1,892,500 $ Options $ - 408,900 408,900 - - - Exercisable at 70.0 cents; vesting on issue Number 2020 2021 1,892,500 1,892,500 - - - - - Performance rights & reserve movements: 2021 Opening balance Performance Rights issued to Directors Performance Rights issued to Employees Lapsed Closing balance $ Performance Rights 1,200,000 115,744 388,000 206,547 375,000 108,959 (194,000) (12,801) 1,769,000 418,449 2020 Performance Rights - 750,000 450,000 - 1,200,000 $ - 74,302 41,442 - 115,744 The fair value of the rights is determined on the market price of the Group’s shares at grant date, with an adjustment made to take into account the one-year vesting period. The maximum value of the performance rights shares vested has been determined as the amount of the grant date fair value of the rights that is expensed. For the December 2020 grant, the maximum value vested for this grant was estimated based on the share price of the Group at grant date. The minimum value of performance rights shares vested is nil, as the shares will be forfeited if the vesting conditions are not met. The Directors do not receive any dividends and are not entitled to vote in relation to the performance rights during the vesting period (Note 22(b)). SATURN METALS LIMITED – ANNUAL REPORT 2021 40 NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Cont.) 14. Interest and Other Income Income recognition Income is recognised to the extent that it is probable that the economic benefit will flow to the Group and the income can be reliably measured. The following specific recognition criteria must also be met before income is recognised. Interest income Income is recognised as the interest accrues using the nominal interest rate. Interest Income Government COVID Grant Total 15. Expenses Loss before income taxes includes the following specific expenses: Employees and Director’s benefit expenses: Employment costs Directors’ fees Recruitment costs 2021 $ 22,592 50,000 72,592 2020 $ 24,974 50,000 74,974 2021 $ 706,824 175,780 73,651 956,255 2020 $ 437,198 111,833 21,175 570,206 16. Income tax The income tax expense (or benefit) for the period is the tax payable (or refundable) on the current period’s taxable income based on the notional income tax rate for each jurisdiction adjusted by changes in deferred tax assets and liabilities attributable to temporary differences and to unused tax losses. Deferred income tax is provided on all temporary differences at the reporting date between the tax bases of assets and liabilities and their carrying amounts for financial reporting purposes. Deferred income tax assets are recognised for all deductible temporary differences, carry forward of unused tax assets and unused tax losses, to the extent that it is probable that taxable profit will be available against which the deductible temporary differences, and the carry-forward of unused tax assets and unused tax losses can be utilised. A deferred income tax asset is not recognised where the deferred income tax asset relating to the deductible temporary difference arises from the initial recognition of an asset or liability in a transaction that is not a business combination and, at the time of the transaction, affects neither the accounting profit nor taxable income or when the deductible temporary difference is associated with investments in subsidiaries, associates or interests in joint ventures, in which case a deferred tax asset is only recognised to the extent that it is probable that the temporary difference will reverse in the foreseeable future and taxable profit will be available against which the temporary difference can be utilised. The carrying amount of deferred income tax assets are reviewed at each reporting date and reduced to the extent it is no longer probable that sufficient taxable income will be available to allow all or part of the deferred income tax asset to be utilised. Deferred income tax assets and liabilities are measured at the tax rates that are expected to apply to the year when the asset is realised or the liability is settled, based on tax rates (and tax laws) that have been enacted at the reporting date. Income taxes relating to items recognised directly in equity are recognised in equity and not in profit and loss for the year. The Group has total carried forward tax losses arising in Australia of $6,937,421 (2020: $3,336,113) available for offset against future assessable income of the Group. The deferred tax asset in respect of these losses has been used to offset a deferred tax liability. The net deferred tax asset attributable to 41 SATURN METALS LIMITED – ANNUAL REPORT 2021 NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Cont.) the residual tax losses of $4,238,443 has not been brought to account until convincing evidence exists that assessable income will be earned of a nature and amount to enable such benefit to be realised. 17. Reconciliation of cash flows from operating activities to loss after income tax For statement of cash flows preparation purposes, cash and cash equivalents includes cash on hand and short-term deposits held at call (other than deposits used as cash backing for performance bonds) with financial institutions. Any bank overdrafts are shown within borrowings in the current liabilities on the consolidated statement of financial position. Net cash outflow from operating activities Adjustments for: Share-based payments Depreciation Interest received and receivable Capitalised exploration expenditure expensed Interest paid on lease liabilities Change in operating assets and liabilities: Decrease in receivables Increase in other current assets Increase/(decrease) in payables Loss after income tax 18. Financial Risk Management Overview 2021 $ (1,369,508) 2020 $ (919,828) (260,470) (57,452) 22,592 (144,986) (3,122) (456,178) (24,541) 24,974 - - (10,683) 49,852 (185,573) (1,959,350) (109,926) - 9,432 (1,476,067) The Group is exposed to financial risks through the normal course of its business operations. The key risks impacting the Group’s financial instruments are considered to be, interest rate risk, liquidity risk, and credit risk. The Group’s financial instruments exposed to these risks are cash and cash equivalents, trade receivables, trade payables and other payables. Credit risk Credit risk arises from cash and cash equivalents, deposits with banks and financial institutions, as well as credit exposures to wholesale and retail customers, including outstanding receivables. Management assesses the credit quality of the counterparties by taking into account its financial position, past experience and other factors. For banks and financial institutions, management considers independent ratings and only dealing with banks licensed to operate in Australia. The Group applies the AASB 9 simplified approach to measuring expected credit losses which uses a lifetime expected loss allowance for all trade receivables and contract assets. To measure the expected credit losses, trade receivables and contract assets have been grouped based on shared credit risk characteristics and the days past due. Tax receivables and prepayments do not meet the definition of financial assets. Risk management: The Group limits its exposure to credit risk in relation to cash and cash equivalents and other financial assets by only utilising banks and financial institutions with acceptable credit ratings. The Group operates in the mining exploration sector and does not have trade receivables from customers. SATURN METALS LIMITED – ANNUAL REPORT 2021 42 NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Cont.) Impairment losses: At 30 June 2021 the Group has not recognised any impairment losses (2020: nil). Liquidity risk Liquidity risk is the risk that the Group will not be able to meet its financial obligations as they fall due. The Group’s approach to managing liquidity is to ensure, as far as possible, that it will have sufficient liquidity to meet its liabilities when due, under both normal and stressed conditions, without incurring unacceptable losses or risking damage to the Group’s reputation. The Group manages liquidity by maintaining adequate reserves by continuously monitoring forecast and actual cash flows ensuring there are appropriate plans in place to finance these future cash flows. Typically, the Group ensures it has sufficient cash on hand to meet expected operational expenses, including the servicing of financial obligations; this excludes the potential impact of extreme circumstances that cannot reasonably be predicted, such as natural disasters. Financial Obligations Trade and other payables less than 6 months Interest rate risk 30 June 2021 $ 30 June 2020 $ 1,311,321 542,840 Interest rate risk is the risk that the Group’s financial position will be adversely affected by movements in interest rates, cash and cash equivalents at variable rates exposes the Group to cash flow interest rate risk. The Group is not exposed to fair value interest rate risk as all of its financial assets and liabilities are carried at amortised amount. At the reporting date the interest rate profile of the Group’s interest-bearing financial instruments was: Short term cash deposits Carrying Amount 2021 $ 2020 $ - - Note 5 Cash flow sensitivity analysis for variable rate instruments of the Group At 30 June 2021 if interest rates had changed +/- 100 basis points from year end rates with all other variables held constant, equity and post-tax loss would have been subject to no change as no short term cash deposits were held during the year (2020: $17,018 lower/higher). Capital Management The Directors’ objectives when managing capital are to ensure that the Group can fund its operations and continue as a going concern, so that they may continue to provide returns for shareholders and benefits for other stakeholders. Due to the nature of the Group’s activities, being mineral exploration, the Group does not have ready access to credit facilities, with the primary source of funding being equity raisings. Therefore, the focus of the Group’s capital risk management is the current working capital position against the requirements of the Group to meet exploration programmes and corporate overheads. The Group’s strategy is to ensure appropriate liquidity is maintained to meet anticipated operating requirements, with a view to initiating appropriate capital raisings as required. 43 SATURN METALS LIMITED – ANNUAL REPORT 2021 NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Cont.) The working capital position of the Group were as follows: Cash and cash equivalents Trade and other receivables Lease liabilities Trade and other payables Working capital position Fair values Note 5 6 9 11 2021 $ 8,155,144 100,460 (62,966) (1,328,714) 6,863,924 2020 $ 5,131,938 33,975 - (542,840) 4,623,073 The carrying values of all financial assets and financial liabilities, as disclosed in the statement of financial position, approximate their fair values. 19. Contingencies & Commitments The Group had no contingent assets or liabilities as at 30 June 2021 (2020: $Nil). Exploration commitments Under the terms of mineral tenement licences held by the Group, minimum annual expenditure obligations are required to be expended during the forthcoming financial year in order for the tenements to maintain a status of good standing. This expenditure may be subject to variation from time to time in accordance with the relevant state department’s regulations. The Group may at any time relinquish tenements and as such avoid the requirement to meet applicable expenditure requirement or may seek exemptions from the relevant authority. Expenditure commitments within one year at the reporting date but not recognised as liabilities were $763,080 (2020: $625,580). Due to the uncertain nature of exploration and the fact that the Group may at any time relinquish tenements, it does not believe it to be appropriate to recognise these commitments post 12 months. The Group had no other exploration expenditure commitments, or other commitments greater than 12 months. 20. Events after the reporting period There were no other matters or circumstances that have arisen since the end of the financial period which significantly affected or may significantly affect the operations of the Group, the results of those operations or the state of affairs of the Group in future financial years. SATURN METALS LIMITED – ANNUAL REPORT 2021 44 NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Cont.) 21. Related Parties Compensation of key management personnel Short-term employee benefits Post-employment benefits Long-term benefits Share-based payments Transactions with related parties 2021 $ 428,996 41,207 18,749 200,972 689,924 2020 $ 299,133 33,893 - 309,106 642,132 Mr Robert Tyson: Non-Executive Director, Mr Robert Tyson is the Managing Director of Peel Mining Limited (“Peel Mining”) (ASX:PEX). In previous years Peel Mining has held a significant shareholding in the Group however they held no shares at 30 June 2021 (Jun 2020: 4.6%, Dec 2019: 27.33%). Although Peel Mining Limited is no longer a shareholder of Saturn, its Managing Director, Mr Rob Tyson, is also one of the Group’s Non-Executive Directors. The Group engaged Peel Mining Limited in a non-exclusive basis to perform and provide administrative & management services through a service agreement to April 2021. Throughout the year, the Group made reimbursements for costs associated with management services to Peel Mining on an arm’s length commercial basis. The total of transactions with Peel Mining during the year was $183,502 (2020: $171,410). There was no outstanding balance owing at year-end (2020: $9,023). Mr Andrew Venn: Non-Executive Director, Mr Andrew Venn holds the position of Executive General Manager, Corporate Services at DDH1 Limited (previously Chief Operations officer of DDH1 Drilling Pty Ltd (“DDH1”). During the year the Group purchased drilling services from a subsidiary of DDH1 (Strike Drilling Pty Ltd). All transactions were on bona-fide arm’s length terms. The total of transactions with DDH1 during the year was $1,052,739 (2020: $nil). There was no outstanding balance owing at year-end (2020: $nil). Transactions with related parties Purchases of management service from associate Purchases of drilling services Outstanding balances arising from transactions with related parties Current payables Peel Mining Limited Entities controlled by key management personnel 2021 $ 183,502 1,052,739 1,236,241 2020 $ 171,410 - 171,410 2021 $ 2020 $ (9,023) - (9,023) - - - Other than as set out above, the Group had no other transactions with related parties. 45 SATURN METALS LIMITED – ANNUAL REPORT 2021 NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Cont.) 22. Share–based payments Share-based compensation benefits to directors, employees and consultants are provided at the discretion of the Board. The fair value of options granted is recognised as an expense with a corresponding increase in equity. The fair value is measured at grant date and recognised over the period during which the recipient becomes unconditionally entitled to the options. The fair value at grant date is independently determined by using an appropriate model based on the vesting conditions attached to the options. The models used to determine fair value include a Black- Scholes model, or a hybrid employee share options pricing model. During the year the Group has granted performance rights and options to Directors and employees through its Performance Rights and Incentive Option Plan. Total expenses arising from share-based payment transactions recognised in the profit and loss during the year were as follows: (a) Options No options were granted to Directors or Employees during the year ended 30 June 2021. Total expenses arising from share-based payment transactions recognised in the profit and loss during the year were as follows: Options granted to Directors Options granted to employees 2021 Number $ - - - 2020 Number 750,000 450,000 1,200,000 - - - $ 234,804 105,630 340,434 Movements in options previously granted to Directors and Employees: Grant date Exercise Expiry price date 9 Mar 18 9 Apr 21 $0.200 9 Mar 18 9 Apr 21 $0.200 6 Dec 18 6 Dec 21 $0.264 6 Dec 18 6 Dec 21 $0.264 9 Dec 19 8 Dec 22 $0.364 9 Dec 19 8 Dec 22 $0.364 Balance at 1 July 2020 3,000,000 1,000,000 1,500,000 1,060,000 750,000 450,000 7,760,000 Granted during the year - - - - - - - Number of options Lapsed during the year - - (1,050,000) (742,000) - - (1,792,000) Exercised during the year (3,000,000) (1,000,000) - - - - (4,000,000) Balance at 30 June 2021 - - 450,000 318,000 750,000 450,000 1,968,000 Vested & exercisable - - 450,000 318,000 - - 768,000 Fair value of options granted: No options were granted in 2021. (b) Performance Rights On 21 December 2020, 388,000 Director Performance Rights (25% Tranche 1; 25% Tranche 2; 25% Tranche 3; 25% Tranche 4) and 375,000 Employee Performance Rights (25% Tranche 1; 25% Tranche 2; 25% Tranche 3; 25% Tranche 4) were granted for nil consideration. During 2020, 1,200,000 performance rights were granted to Directors & Employees. SATURN METALS LIMITED – ANNUAL REPORT 2021 46 NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Cont.) Total expenses arising from share-based payment transactions recognised in the profit and loss during the year were as follows: 2021 performance rights granted to Directors 2021 performance rights granted to Employees 2020 performance rights granted to Directors 2020 performance rights granted to Employees 2021 Number 388,000 375,000 - - 763,000 $ 73,604 39,220 - - - - 750,000 450,000 112,824 1,200,000 2020 Number $ - - 74,302 41,442 115,744 Movements in performance rights previously granted to Directors and Employees: Balance of Performance Rights Grant date Expiry date 21 Dec 20 20 Dec 23 21 Dec 20 20 Dec 23 9 Dec 19 8 Dec 22 9 Dec 19 8 Dec 22 Balance at 1 July 2020 - - 750,000 450,000 1,200,000 Granted during the year 388,000 375,000 - - 763,000 Fair value of performance rights granted: Converted during the year Lapsed during the year - - - - - (127,000) - (67,000) (194,000) Balance at 30 June 2021 388,000 248,000 750,000 383,000 1,769,000 Vested & exercisable - - - - - The fair value of the Tranche 1, 2 and 4 Performance Rights is determined to be 70.0 cents per share (Directors) and 66.0 cents per share (Employees). They were valued on a prorated basis as a result of the vesting conditions attached to these performance rights. The fair value at grant date is independently determined using a Black-Scholes option model takes into account the exercise price, the term of the performance right and the share price at grant date. Fair value of the performance rights granted during the year ended 30 June 2021 included the following model inputs: Exercise price Grant date Performance measurement/ vesting date Expiry date Share price at issue date Expected price volatility Expected dividend yield Risk-free interest rate (c) Acquisition – Share based payment Directors Nil 26 November 2020 26 November 2022 26 November 2023 70.0 cents 70% 0.00% 0.09% Employees Nil 21 December 2020 21 December 2022 20 December 2023 66.0 cents 70% 0.00% 0.09% The Group made no acquisitions using share-based payments during the year. (d) Weighted averages – Options The weighted average exercise price $0.33 (2020: $0.25). The weighted average fair value of options is $0.18 (2020: $0.15). The weighted average remaining contractual life is 1.11 years (2020: 1.25 years). 47 SATURN METALS LIMITED – ANNUAL REPORT 2021 NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Cont.) 23. Remuneration of Auditors Amounts paid or due and payable to the PricewaterhouseCoopers Auditing and reviewing financial reports Indirect taxation services 24. Loss per share 2021 $ 2020 $ 36,500 36,500 35,000 35,000 - - 3,367 3,367 Basic loss per share is calculated by dividing the loss attributable to equity holders of the Group, 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 year. 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. Basic loss per share Loss from continuing operations attributable to the ordinary equity holders of the Group 2021 $ 2020 $ (0.02) (0.02) Diluted loss per share from Loss ordinary equity holders of the Group continuing operations attributable to the (0.02) (0.02) Reconciliation of loss used in calculation of loss per share Loss from continuing operations attributable to the ordinary equity holders of the Group per share Weighted average number of shares used as the denominator Weighted average number of shares used in calculating basic loss per share Effect of dilutive securities (1,959,350) (1,476,067) Number of Number of Shares 2021 Shares 2020 104,675,486 74,268,410 Options on issue at reporting date could potentially dilute earnings per share in the future. The effect in the current year is to reduce the loss per share hence they are considered anti-dilutive. SATURN METALS LIMITED – ANNUAL REPORT 2021 48 NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Cont.) 25. Parent Entity Statement of financial position Current assets Total assets Current liabilities Total liabilities Net assets Equity Issued capital Share option reserve Share revaluation reserve Accumulated losses Total equity Parent Entity 2021 $ 8,355,538 30,917,258 (1,329,258) (1,463,908) 29,453,350 33,265,410 1,258,437 408,900 (5,479,396) 29,453,350 2020 $ 5,187,239 17,898,203 (537,979) (537,979) 17,360,224 19,882,745 997,967 (3,520,488) 17,360,224 Statement of profit or loss and other comprehensive income Interest Revenue Other income Comprehensive loss for the year Total comprehensive loss for the year 22,592 50,000 (2,031,499) (1,958,907) 24,974 50,000 (1,551,024) (1,476,050) Commitments for the parent entity are the same as those for the consolidated entity and are set out in Note 19. The parent entity has not entered into a deed of cross guarantee nor are there any contingent liabilities at year-end. 26. Statement of Significant Accounting Policies The principal accounting policies adopted in the preparation of the financial report are set out below. These policies have been consistently applied to all the years presented, unless otherwise stated. The financial report includes the consolidated financial statements for the Group during the financial years ended 30 June 2021 and the comparative period. (a) Basis of preparation These general purpose financial statements have been prepared in accordance with Australian Accounting Standards, other authoritative pronouncements of the Australian Accounting Standards Board, Australian Accounting Interpretations and the Corporations Act 2001. Saturn Metals Limited is a for-profit entity for the purpose of preparing the consolidated financial statements. The presentation currency of these accounts is Australian Dollars (AUD). As at 30 June 2021, the Group made a net loss after tax of $1,959,350 (2020: $1,476,067). The ongoing capital requirements of the Group are dependent on the Group’s ability to raise funds in the future. The Directors have prepared a cash flow forecast, which indicates that the Group will have sufficient cash flows to meet all commitments and working capital requirements for the twelve month period from the date of signing this financial report. Based on the cash flow forecasts and other factors referred to above, the directors are satisfied that the basis of preparation is appropriate. Compliance with IFRS The consolidated financial statements and notes of the Group comply with International Financial Reporting Standards (IFRS). 49 SATURN METALS LIMITED – ANNUAL REPORT 2021 NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Cont.) Historical cost convention These consolidated financial statements have been prepared under the historical cost convention. (b) Principles of consolidation The consolidated financial statements are those of the consolidated entity, comprising Saturn Metals Limited (“the parent entity”) and entities controlled during the year and at reporting date (“Group”). A controlled entity is any entity that the Group 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. Information from the consolidated financial statements of the controlled entities is included from the date the parent company obtains control until such time as control ceases. Where there is a loss of control of a subsidiary, the consolidated financial statements include the results for the part of the reporting period during which the parent company has control. Subsidiary acquisitions are accounted for using the acquisition method of accounting. The financial statements of subsidiaries are prepared for the same reporting period as the parent entity, using consistent accounting policies. All intercompany balances and transactions, including unrealised profits arising from intra-Group transactions, have been eliminated in full. Unrealised losses are eliminated except where costs cannot be recovered. Investments in subsidiaries are carried at cost in the parent entity. (c) Employee benefits Short-term obligations Liabilities for wages and salaries, including non-monetary benefits and leave entitlements that are expected to be settled wholly within 12 months after the end of the period in which the employees render the related service are recognised in respect of employees’ services up to balance date and are measured at the amounts expected to be paid when the liabilities are settled. (d) Goods and services tax Revenues, expenses and assets are recognised net of goods and services tax (GST), except where the amount of GST incurred is not recoverable from the taxation authority. In these circumstances the GST is recognised as part of the cost of acquisition of the asset or as part of the expense item. Receivables and payables are stated with the amount of GST included. The net amount of GST recoverable is included as a current asset in the statement of financial position. Cash flows are included in the statement of cash flows on a gross basis. The GST components of cash flows arising from investing and financing activities which are recoverable from the taxation authority are classified as operating cash flows. New standards and amendments Certain new accounting standards and interpretations have been published that are mandatory for the 30 June 2021 reporting period and have not been early adopted by the group. These standards are not expected to have a material impact on the entity in the current or future reporting periods and on foreseeable future transactions. (e) Critical accounting estimates and judgements The Directors evaluate estimates and judgements incorporated into the financial report based on historical knowledge and best available current information. SATURN METALS LIMITED – ANNUAL REPORT 2021 50 NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Cont.) The Group makes estimates and judgements in applying the accounting policies. Critical judgements in respect of accounting policies relate to exploration assets, where exploration expenditure is capitalised in certain circumstances. Recoverability of the carrying amount of any exploration assets is dependent on the successful development and commercial exploitation or sale of the respective areas of interest. Share-based payment transactions The Group measures the cost of equity-settled share-based payment transactions by reference to the fair value of the equity instruments at the grant date. The fair value is determined by using an appropriate model based on the vesting conditions attached to the options. The models used to determine fair value include a Black-Scholes model, or a hybrid employee share options pricing model. 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 expenses and equity. Impairment of capitalised exploration and evaluation expenditure It is the Group’s policy to capitalise costs relating to exploration and evaluation activities. The future recoverability of capitalised exploration and evaluation expenditure is dependent upon a number of factors, including whether the Group decides to exploit the related lease itself or, if not, whether it successfully recovers the related exploration and evaluation asset through sale. Factors that could impact future recoverability include the level of reserves and resources, future technological changes which could impact the cost of mining, future legal changes (including changes to environmental restoration obligations) and changes to commodity prices. To the extent that capitalised exploration and evaluation expenditure is determined not to be recoverable in the future, profits and net assets will be reduced in the period in which the determination is made. 51 SATURN METALS LIMITED – ANNUAL REPORT 2021 DIRECTOR’S DECLARATION The Board of Directors of Saturn Metals Limited declares that: (a) the consolidated financial statements, comprising the consolidated statement of profit or loss and other comprehensive income, consolidated statement of financial position, consolidated statement of cash flows, consolidated statement of changes in equity and accompanying notes are in accordance with the Corporations Act 2001 and: (i) comply with Accounting Standards and the Corporations Regulations 2001 and other mandatory professional reporting requirements; and (ii) give a true and fair view of the financial position as at 30 June 2021 and performance for the financial year ended on that date of the entity. (b) the Group has included in the notes to the consolidated financial statements an explicit and unreserved statement of compliance with International Financial Reporting Standards; (c) In the Directors’ opinion, there are reasonable grounds to believe that the Group will be able to pay its debts as and when they become due and payable; and (d) the Board of Directors have been given the declaration 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 Board of Directors and is signed for and on behalf of the Directors by: Ian Bamborough Managing Director Perth, Western Australia 30 September 2021 SATURN METALS LIMITED – ANNUAL REPORT 2021 52 Independent auditor’s report To the members of Saturn Metals Limited Report on the audit of the financial report Our opinion In our opinion: The accompanying financial report of Saturn Metals Limited (the Company) and its controlled entities (together the Group) is in accordance with the Corporations Act 2001, including: (a) giving a true and fair view of the Group's financial position as at 30 June 2021 and of its financial performance for the year then ended, and (b) complying with Australian Accounting Standards and the Corporations Regulations 2001. What we have audited The Group financial report comprises: • • • • • • the consolidated statement of financial position as at 30 June 2021 the consolidated statement of changes in equity for the year then ended the consolidated statement of cash flows for the year then ended the consolidated statement of profit or loss and other comprehensive income for the year then ended the notes to the consolidated financial statements, which include significant accounting policies and other explanatory information, and the directors’ declaration. 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 believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion. Independence We are independent of the Group in accordance with the auditor independence requirements of the Corporations Act 2001 and the ethical requirements of the Accounting Professional & 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. PricewaterhouseCoopers, ABN 52 780 433 757 Brookfield Place, 125 St Georges Terrace, PERTH WA 6000, GPO Box D198, PERTH WA 6840 T: +61 8 9238 3000, F: +61 8 9238 3999, www.pwc.com.au Liability limited by a scheme approved under Professional Standards Legislation. Our audit approach An audit is designed to provide reasonable assurance about whether the financial report is free from material misstatement. Misstatements may arise due to fraud or error. They are considered material if individually or in aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of the financial report. We tailored the scope of our audit to ensure that we performed enough work to be able to give an opinion on the financial report as a whole, taking into account the geographic and management structure of the Group, its accounting processes and controls and the industry in which it operates. Materiality • For the purpose of our audit we used overall materiality of $309,618 million, which represents approximately 1% of the Group’s total assets. • We applied this threshold, together with qualitative considerations, to determine the scope of our audit and the nature, timing and extent of our audit procedures and to evaluate the effect of misstatements on the financial report as a whole. • We chose the Company's total assets because, in our view, it is the benchmark against which the performance of the company is most commonly measured whilst in the exploration phase. • We utilised a 1% threshold based on our professional judgement, noting it is within the range of commonly acceptable asset-related thresholds. Audit Scope • Our audit focused on where the Group made subjective judgements; for example, significant accounting estimates involving assumptions and inherently uncertain future events. • The Company's operational and financial processes are managed by a corporate function in Perth, where substantially all of our audit procedures are performed. 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 for the current period. The key audit 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. Further, any commentary on the outcomes of a particular audit procedure is made in that context. We communicated the key audit matters to the Audit and Risk Committee. Key audit matter How our audit addressed the key audit matter Carrying value of exploration and evaluation assets We performed the following procedures, amongst others: (Refer to note 10) As at 30 June 2021, the Group had capitalised exploration and evaluation assets of $22.2 million relation to mining, exploration and prospecting licenses across Western Australia and New South Wales. This was a key audit matter because of the relative size of the exploration and evaluation balance in the consolidated balance sheet and the risk of impairment should the result of exploration activities not be positive, or the Group relinquish certain exploration licenses as it continues to assess future viability. Basis of preparation of the financial report (Refer to note 26) The financial statements have been prepared by the Group on a going concern basis, which contemplates that the Group will continue to meet its commitments, realise its assets and settle its liabilities in the normal course of business. The Group is in the exploration and evaluation phase and therefore does not generate revenue from its operations and relies on funding from its shareholders or other sources to continue as a going concern. These funds are used to meet expenditure requirements to maintain the good standing of the Group’s tenements, progress project feasibility studies, and to cover corporate overheads. Assessing the appropriateness of the Group’s basis of preparation for the financial report was a key audit matter due to its importance to the financial report and the level of judgement involved in assessing future funding and operational status, in particular with respect to the Group forecasting future cash flows for a period of at least 12 months from the audit report date (cash flow forecasts). • Assessed whether the Group retained right of tenure for all its exploration licence areas by obtaining licence status records from relevant state government online databases. • For a sample of additions to exploration and evaluation assets during the year inspected relevant supporting documentation, such as invoices, and compared the amounts to accounting records. • Obtained management’s exploration expenditure forecasts supporting their assessment of indicators of impairment. • Inquired of management and directors as to the future capitalised exploration and evaluation assets and assessed plans for future expenditure to meet minimum licence requirements. In assessing the appropriateness of the Group’s going concern basis of preparation for the financial report, we performed the following procedures, amongst others: • Evaluated the appropriateness of the Group’s assessment of its ability to continue as a going concern, including whether the period covered is at least 12 months form the date of the financial report and that relevant information of which we are aware as a result of the audit has been included. • Enquired of management and the directors whether they were aware of any events or conditions, including beyond the period of assessment that may cast significant doubt on the Group’s ability to continue as a going concern. • Evaluated selected data and assumptions used in the Group’s cash flow forecasts. • Developed an understanding of what forecast expenditure in the cash flow forecast is committed and what could be considered discretionary. Key audit matter How our audit addressed the key audit matter • Assessed management’s historical accuracy of cash flow forecasting by comparing actual results to prior period forecasts. • Evaluated whether, in view of the requirements of Australian Accounting Standards, the financial report provides adequate disclosures about these events or conditions. Other information The directors are responsible for the other information. The other information comprises the information included in the annual report for the year ended 30 June 2021, but does not include the financial report and our auditor’s report thereon. Prior to the date of this auditor's report, the other information we obtained included the Corporate Directory, Director's Report and Director's Declaration. We expect the remaining other information to be made available to us after the date of this auditor's report. Our opinion on the financial report does not cover the other information and we do not and will not express an opinion or 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 on the other information that we obtained prior to the date of this auditor’s report, 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. When we read the other information not yet received, if we conclude that there is a material misstatement therein, we are required to communicate the matter to the directors and use our professional judgement to determine the appropriate action to take. Responsibilities of the directors for the financial report The directors of the Company are responsible for the preparation of the financial report that gives a true and fair view in accordance with Australian Accounting Standards and the Corporations Act 2001 and for such internal control as the directors determine is necessary to enable the preparation of the financial report that gives a true and fair view and is free from material misstatement, whether due to fraud or error. In preparing the financial report, the directors are responsible for assessing the ability of the Group to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the directors either intend to liquidate the Group or to cease operations, or have 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 the financial report. A further description of our responsibilities for the audit of the financial report is located at the Auditing and Assurance Standards Board website 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 Our opinion on the remuneration report We have audited the remuneration report included in pages 18 to 25 of the directors’ report for the year ended 30 June 2021. In our opinion, the remuneration report of Saturn Metals Limited for the year ended 30 June 2021 complies with section 300A of the Corporations Act 2001. Responsibilities The directors of the Company are responsible for the preparation and presentation of the remuneration report in accordance with section 300A of the Corporations Act 2001. Our responsibility is to express an opinion on the remuneration report, based on our audit conducted in accordance with Australian Auditing Standards. PricewaterhouseCoopers Helen Bathurst Partner Perth 30 September 2021 SCHEDULE OF TENEMENTS Tenement State Current Area Area Unit Measured km2 Grant Date Expiry Date Western Australia: E 31/1063* E 31/1075 E 31/1076 E 31/1087 E 31/1116* E 31/1132 E 31/1163* E 31/1164 E 31/1202 E 31/1259 E 31/1287 E 39/1198* E 39/1887* E 39/1984* E 40/337 E 40/372 E 40/373 M 31/486* M 31/494* M 39/296* P 31/2068 P 31/2072 P 31/2073 WA WA WA WA WA WA WA WA WA WA WA WA WA WA WA WA WA WA WA WA WA WA WA 34 11 17 4 14 1 70 17 2 15 11 11 5 61 3 55 10 410.8 1,105 24.43 78 68 166 Standard Block Standard Block Standard Block Standard Block Standard Block Standard Block Standard Block Standard Block Standard Block Standard Block Standard Block Standard Block Standard Block Standard Block Standard Block Standard Block Standard Block Ha Ha Ha Ha Ha Ha Total: 23 Exploration, Prospecting & Mining Leases L 31/72 L 31/74 L 31/75 L 31/76 L 31/77 L31/78 L31/79 L 31/80 L 31/81 L 31/82 L 31/83 L 31/84 L 31/85 L 39/284 L 39/292 L 39/0310 L 39/0311 L 39/0312 L 40/28 L 40/29 L40/37 L40/38 L40/39 WA WA WA WA WA WA WA WA WA WA WA WA WA WA WA WA WA WA WA WA WA WA WA 19,357 6,248 10,416 1,206 1,196 598 2874 458 4,706 971 1,303 1,601 4,780 289 6,590 11,727 553 3,789 2,675 3,800 1,189 836 8,138 Ha Ha Ha Ha Ha Ha HA HA HA HA HA HA HA Ha Ha Ha Ha Ha Ha Ha Ha Ha Ha Total: 23 Miscellaneous Licences New South Wales: ELA 6179 NSW Total: 1 Exploration Lease 54 Standard Block (cid:1) Note: * Land subject to 5% Hampton Hill Royalty on +1Moz Production 101.73 32.91 50.86 11.97 41.89 2.99 209.44 50.86 5.98 44.88 32.88 32.91 14.96 182.51 8.98 164.56 29.92 4.11 11.05 0.24 0.78 0.68 1.66 1,038.58km2 193.57 62.48 104.16 12.06 11.96 5.98 28.74 4.58 47.06 9.71 13.03 16.01 47.8 2.89 65.9 117.27 5.53 37.89 26.75 38 11.89 8.36 81.38 953.00 km2 153.7 153.7 km2 9/03/2015 9/03/2015 10/03/2015 19/03/2015 26/07/2016 1/02/2017 27/04/2018 27/04/2018 1/02/2021 Application Application 31/03/2009 24/02/2016 30/03/2017 3/12/2014 3/07/2018 16/11/2018 12/03/2015 Application 30/09/1993 8/05/2015 8/05/2015 8/05/2015 22/02/2021 Application Application Application Application Application Application Application Application Application Application Application Application 1/07/2020 24/02/2021 Application Application Application 24/02/2021 24/02/2021 Application Application Application Application 8/03/2025 8/03/2025 9/03/2025 18/03/2025 25/07/2026 31/01/2022 26/04/2023 26/04/2023 31/01/2026 30/03/2023 23/02/2026 29/03/2022 2/12/2024 2/07/2023 15/11/2023 11/03/2036 29/09/2035 7/05/2023 7/05/2023 7/05/2023 21/02/2042 05/08/2042 30/06/2041 23/02/2042 23/02/2042 23/02/2042 SATURN METALS LIMITED – ANNUAL REPORT 2021 58 MINERAL RESOURCE ESTIMATION GOVERNANCE STATEMENT During the year, the Company provided an update to JORC 2012 Apollo Hill Mineral Resource estimate. Saturn Metals Limited has ensured that the Mineral Resource estimates are subject to good governance arrangements and internal controls. The Mineral Resources reported have been generated by independent external consultants who are experienced in best practices in modelling and estimation methods. The consultants have also undertaken a review of the quality and suitability of the underlying information used to generate the resource estimations. Additionally, Saturn Metals Limited carries out regular reviews and audits of internal processes and external contractors that have been engaged by the Company. The Mineral Resource estimate for Apollo Hill was compiled and reported in accordance with the 'Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves' (the JORC Code) 2012 Edition. January 2021 Apollo Hill Mineral Resource: Preliminary Whittle pit optimizations using approximated regional mining and processing costs for multiple processing scenarios have been run on the resource model using a gold price of US$1,700/oz to generate a range of pit shells and cut-off grades. A pit shell for a combined mill and heap leach scenario representing a revenue factor of 1.4 was selected as a nominal constraint within which to report the Apollo Hill Mineral Resource, thereby satisfying the JORC Code requirement for a Mineral Resource to have reasonable prospects for eventual economic extraction. Other relevant information is described in the JORC Code Table 1 as appropriate. A nominal 0.4 g/t Au lower cut-off grade was selected for all material types. There is no material depletion by mining within the model area. Estimation is by localised multiple indicator kriging for Apollo Hill zone and the Apollo Hill Hanging- wall zone; estimation of Ra and Tefnut zone used restricted ordinary kriging due to limited data. The model assumes a rotated 5 m by 12.5 m by 5 m RL Selective Mining Unit (SMU) for selective open pit mining. The final models are SMU models and incorporate internal dilution to the scale of the SMU. Technically the models do not account for mining related edge dilution and ore loss. These parameters should be considered during the mining study as being dependent on grade control, equipment and mining configurations including drilling and blasting. Classification is according to JORC Code Mineral Resource categories. Totals may vary due to rounded figures. October 2019 Apollo Hill Mineral Resource: The models are reported above nominal RLs (180 mRL – this is approximately 180 metres below surface (mbs) (accounting for localised variations in topography) for the Apollo Hill main zone and 260 mRL or 90mbs for Ra the deposit and the Apollo Hill Hanging-walls – refer to reporting RL’s illustrated in Figures 1, 3 and 4 in the ASX announcement titled “Apollo Hill Resource Upgrade” dated 14/10/2019) and nominal 0.5 g/t Au lower cut-off grade for all material types. Saturn Metals advise that there is no material depletion by mining within the model area. Estimation is by localised multiple indicator kriging for Apollo Hill zone and the Apollo Hill Hanging-wall zone; estimation of Ra zone used restricted ordinary kriging due to limited data. The model assumes a 5mE by 12.5mN by 5mRL Selective Mining Unit (SMU) for selective open pit mining. The final models are SMU models and incorporate internal dilution to the scale of the SMU. Technically the models do not account for mining related edge dilution and ore loss. These parameters should be considered during the mining study as being dependent on grade control, equipment and mining configurations including drilling and blasting. Classification is according to JORC Code Mineral Resource categories. Totals may vary due to rounded figures. 59 SATURN METALS LIMITED – ANNUAL REPORT 2021 COMPETENT PERSONS STATEMENT Competent Persons Statements – for October 2019 & January 2021 Resources Apollo Hill and Apollo Hill Project The information in this report that relates to exploration targets, geology, and exploration results and data compilation is based on information compiled by Kathryn Cutler, a Competent Person who is a Member of The Australian Institute of Mining and Metallurgists. Kathryn Cutler is a fulltime employee of the Company. Kathryn Cutler has sufficient experience that is relevant to the style of mineralisation and type of deposit under consideration and to the activity being undertaken to qualify as a Competent Person as defined in the 2012 Edition of the ‘Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves’. Kathryn Cutler consents to the inclusion in the report of the matters based on her information in the form and context in which it appears. The information in this announcement that relates to Apollo Hill Mineral Resource estimates (gold) is based on information compiled and generated by Ingvar Kirchner, an employee of AMC Consultants. Mr Kirchner consents to the inclusion, form and context of the relevant information herein as derived from the original resource reports. Mr Kirchner has sufficient experience relevant to the style of mineralisation and type of deposit under consideration and to the activity which is being undertaken to qualify as a Competent Person as defined in the 2012 Edition of the JORC ‘Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves’. Competent Persons Statement – Exploration The information in this report that relates to exploration targets and exploration results is based on information compiled by Ian Bamborough, a Competent Person who is a Member of The Australian Institute of Geoscientists. Ian Bamborough is a fulltime employee and Director of the Company, in addition to being a shareholder in the Company. Ian Bamborough has sufficient experience that is relevant to the style of mineralisation and type of deposit under consideration and to the activity being undertaken to qualify as a Competent Person as defined in the 2012 Edition of the ‘Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves’. Ian Bamborough consents to the inclusion in the report of the matters based on his information in the form and context in which it appears. (a) This document contains exploration results and historic exploration results as originally reported in fuller context in Saturn Metals Limited ASX Announcements, Quarterly Reports and Prospectus - as published on the Company's website. Saturn Metals Limited confirms that it is not aware of any new information or data that materially affects the information on results noted. Announcement dates to to 19/08/2021, 12/07/2021, 20/06/2021, 08/06/2021, refer 26/05/2021,14/04/2021, 30/03/2021, 22/03/2021, 28/01/2021, 25/01/2021, 22/12/2020, 30/10/2020, 31/07/2020, 21/04/2020 and 31/01/2020. include but are not limited to SATURN METALS LIMITED – ANNUAL REPORT 2021 60 ADDITIONAL SHARHEOLDER INFORMATION Issued Securities The following security holder information set out in this section was applicable as at 18 October 2021. Quoted Securities – Fully Paid Ordinary Shares a) Distribution of Share Holdings Size of Holding 1 to 1,000 1,001 to 5,000 5,001 to 10,000 10,001 to 100,000 100,001 and Over Total Number of Shareholders 50 189 129 389 107 864 Number of Shares 22,261 532,215 1,085,454 14,938,428 96,036,152 112,614,510 % 0.02 0.47 0.96 13.27 85.28 100.00 At the prevailing market price of $0.42 per share there were 57 shareholders holding less than a marketable parcel of shares, totalling 29,972 shares. b) Voting Rights “Subject to any rights or restrictions for the time being attached to any class or classes of Shares, at meetings of Shareholders or classes of Shareholders: a) each Shareholder entitled to vote may vote in person or by proxy, attorney or Representative; b) on a show of hands, every person present, who is a Shareholder, or a proxy, attorney or Representative of a Shareholder has one vote (even though he or she may represent more than one member); and c) on a poll, every person present who is a Shareholder or a proxy, attorney or Representative of a Shareholder shall, in respect of each fully paid Share held by him, or in respect of which he is appointed a proxy, attorney or Representative, have one vote for the Share, but in respect of partly paid Shares, shall have such number of votes being equivalent to the proportion which the amount paid (not credited) is of the total amounts paid and payable in respect of those Shares (excluding amounts credited).” c) Twenty Largest Shareholders Shareholder CITICORP NOMINEES PTY LIMITED HSBC CUSTODY NOMINEES (AUSTRALIA) LIMITED J P MORGAN NOMINEES AUSTRALIA PTY LIMITED GLYDE STREET NOMINEES PTY LTD MR IAN BAMBOROUGH WYTHENSHAWE PTY LTD MR ANDREW LENOX HEWITT PERTH CAPITAL PTY LTD BNP PARIBAS NOMINEES PTY LTD EQUITY TRUSTEES LIMITED MR ANDREW LENOX HEWITT ROMAN ROAD HOLDINGS PTY LTD MR KEIRAN HAYNES REDCLIFF PTY LTD PERTH CAPITAL PTY LTD MR RICHARD ARTHUR LOCKWOOD HOWARD TRADING CO PTY LTD MS SALLY YVONNE ROWAN Number of Shares Held 30,172,250 11,342,673 5,000,000 3,931,350 3,063,941 2,445,000 1,960,000 1,775,000 1,676,464 1,574,251 1,495,000 1,400,000 1,234,043 1,155,000 1,104,047 1,000,000 900,000 900,000 % 26.79 10.07 4.44 3.49 2.72 2.17 1.74 1.58 1.49 1.40 1.33 1.24 1.10 1.03 0.98 0.89 0.80 0.80 61 SATURN METALS LIMITED – ANNUAL REPORT 2021 ADDITIONAL SHAREHOLDER INFORMATION (Cont.) Shareholder SASSEY PTY LTD WYTHENSHAWE PTY LTD WARRAMBOO HOLDINGS PTY LTD DENKEY PTY LTD Top Twenty Shareholders Total Issued Capital d) Substantial Shareholders Shareholder DUNDEE CORORATION & ASSOCIATES FRANKLIN RESOURCES, INC. AND ITS AFFLIATES WHYTHENSHAWE PTY LTD AND ASSOCIATES SPROTT INC. Total e) On Market Buy-Back There is currently no on-market buy-back in place. Unquoted Securities – Options & Performance Rights Options a) Details of Options on Issue Class Exercisable at $0.264 Expiring 06/12/21 Exercisable at $0.364 Expiring 08/12/22 Exercisable at $0.700 Expiring 26/06/22 Total Options on Issue b) Voting Rights Number of Shares Held 868,655 800,000 800,000 714,071 75,311,745 112,614,510 % 0.77 0.71 0.71 0.63 66.88 100.00 Number of Shares Held 19,911,200 11,129,938 10,691,969 9,224,352 50,957,459 % 17.68 9.88 9.49 8.19 45.25 Number of Holders 5 7 2 14 Number of Options 618,000 1,200,000 1,892,500 3,710,500 Unquoted options do not entitle the holder to any voting rights. c) Holders of More Than 20% of a Class of Unquoted Options The Group has a total of 3,710,500 unquoted options over ordinary shares. The names of security holders holding more than 20% of a class of Unquoted Option, not issued under the Employee Incentive Option & Performance Rights Plan are set out in the following table: Name Dundee Corporation & Associates Issued under Employee Incentive Option & Performance Rights Plan Other holders, individually less than 20% Exercisable at $0.264 Expiring 06/12/21 Exercisable at $0.364 Expiring 08/12/22 Exercisable at $0.70 Expiring 26/06/22 - 618,000 - 618,000 - 1,892,500 1,200,000 - 1,200,000 - - 1,892,500 SATURN METALS LIMITED – ANNUAL REPORT 2021 62 ADDITIONAL SHAREHOLDER INFORMATION (Cont.) Performance Rights a) Details of Performance Rights on Issue Class Unvested 2019 rights, Expiring 08/12/22 Unvested 2020 rights, Expiring 20/12/23 Total Performance Rights on Issue b) Voting Rights No. of Holders No. Performance Rights 7 3 10 1,133,000 636,000 1,769,000 Unquoted performance rights do not entitle the holder to any voting rights. c) Holders of More Than 20% of a Class of Unquoted Performance Rights The Group has a total of 1,769,000 unquoted performance rights on issue. The names of security holders holding more than 20% of a class of Unquoted Performance Rights, not issued under the Employee Incentive Option & Performance Rights Plan are set out in the following table: Name Issued under Employee Incentive Option & Performance Rights Plan Other holders individually less than 20% 2019 Performance Rights Expiring 08/12/22 2020 Performance Rights Expiring 20/12/23 1,133,000 - 1,133,000 636,000 - 636,000 Corporate Governance Statement The Company’s 2021 Corporate Governance Statement can be accessed at: https://saturnmetals.com.au/about/corporate-governance/ 63 SATURN METALS LIMITED – ANNUAL REPORT 2021 9 Havelock Street West Perth WA 6005 info@saturnmetals.com.au +61 (8) 6234 1114 www.saturnmetals.com.au