LAKE RESOURCES N.L. — Capital/Financing Update 2018

Aug 1, 2018

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LAKE RESOURCES N.L. (ASX:LKE)

ASX Market Announcements Office 2 August 2018

APPENDIX 3B

Argentine-focused lithium exploration and project development company Lake Resources N.L. (ASX:LKE, “Lake”, “LKE” or “Company”) advises that the Company has entered into Controlled Placement agreement (CPA) with Acuity Capital. The CPA provides the Company with up to $5 million of standby capital over the coming 29 month period. Importantly, LKE retains full control of all aspects of the placement process: having sole discretion as to whether or not to utilise the CPA, the quantum of issued shares, the minimum issue price of shares and the timing of each placement tranche (if any).

There are no requirements on LKE to utilise the CPA and LKE may terminate the CPA at any time, without cost or penalty. Acuity Capital and the CPA do not place any restrictions at any time on LKE raising capital through other methods. If LKE does decide to utilise the CPA, LKE is able to set a floor price (at its sole discretion) and the final issue price will be calculated as the greater of that floor price set by LKE and a 10% discount to a Value Weighted Average Price (VWAP) over a period of LKE’s choosing (again at the sole discretion of LKE).

As collateral for the CPA, LKE has agreed to place 15 million shares from its LR7.1 capacity, at nil consideration to Acuity Capital (Collateral Shares) but may, at any time, cancel the CPA and buy back the Collateral Shares for no consideration (subject to shareholder approval).

Notice under s708A(5)(e) of the Corporations Act 2001

Lake Resources NL (ASX: LKE) (Company) has issued and allotted 15,000,000 fully paid ordinary shares in the capital of the Company at issue prices as outlined in the Appendix 3B. Accordingly, the Company gives notice under section 708A(5)(e)(i) of the Corporations act 2001 (Cth) (Act) that:

1. The above mentioned shares were issued without disclosure to investors under Part 6D.2 of the Act;

2. As at the date of this notice the Company has complied with:

3. (i) The provisions of Chapter 2M of the Act as they apply to the Company; and (ii) Section 674 of the Act; and

4. As at the date of this notice there is n information to be disclosed which is “excluded information” as defined in subsection 708A(7) of the Act that is reasonable for investors and their professional advisers to find in a disclosure document.

For further information please contact:

Steve Promnitz Follow Lake Resources on Twitter: Managing Director https://twitter.com/Lake_Resources +61 2 9188 7864 steve@lakeresources.com.au http://www.lakeresources.com.au

Released through: Henry Jordan, Six Degrees Investor Relations: +61 (0) 431 271 538

Lake Resources N.L. (ABN 49 079 471 980) ASX:LKE Suite 2, Level 10, 70 Phillip St, Sydney NSW 2000, Australia T: +61 2 9188 7864 E: lakeresources@lakeresources.com.au

1

Background on Lake Resources NL (ASX:LKE)

Lake Resources NL (ASX:LKE, Lake) is a lithium exploration and development company focused on developing its 3 lithium brine projects and 1 hard rock project in Argentina, all owned 100%. The leases are in a prime location among the lithium sector’s largest players within the Lithium Triangle where half of the world’s lithium is produced. Lake holds one of the largest lithium tenement packages in Argentina (~180,000Ha) secured in 2016 prior to a significant ‘rush’ by major companies. The large holdings provides the potential to provide security of supply demanded by battery makers and electric vehicle manufacturers.

The three key brine projects, Kachi, Olaroz/Cauchari, and Paso, are located adjacent to major world class brine projects either in production or being developed in the highly prospective Jujuy and Catamarca Provinces. The Olaroz-Cauchari project is located in the same basin as Orocobre’s Olaroz lithium production and adjoins SQM/Lithium Americas Cauchari project, where high grade lithium (600 mg/L) with high flow rates have been drilled immediately across the lease boundary.

The Kachi project covers 50,000 Ha over a salt lake south of FMC’s lithium operation and near Albemarle’s Antofalla project. Drilling at Kachi has confirmed a large lithium brine bearing basin over 22km long and over 400m deep. Drilling over Kachi is aimed to produce a resource statement in 2018, anticipated in Sept/Oct 2018.

Drilling will commence in coming months at Olaroz-Cauchari now that tenure has been confirmed in a landmark agreement in March 2018. This will provide several catalysts for the company’s growth. Scope exists to unlock considerable value through partnerships and corporate deals in the near-term.

Significant corporate transactions continue in adjacent leases with development of SQM/Lithium Americas Olaroz/Cauchari project with an equity/debt investment over $300 million and Advantage Lithium’s equity transaction in some of Orocobre’s leases. LSC Lithium has also raised over $60 million on a large lease package in similar areas as Lake’s properties. Nearby projects of Lithium X were recently acquired via a takeover offer of C$265 million completed March 2018. The northern half of Galaxy’s Sal de Vida resource was purchased for US$280 million by POSCO in June 2018

The demand for lithium continues to be strong for lithium ion batteries in electric vehicles, according to recent data from the leading independent battery minerals consultant - Benchmark Mineral Intelligence. Supply continues to be constrained suggesting good opportunities for upstream lithium companies for many years.

Lake Resources N.L. (ACN 079 471 980) ASX:LKE Suite 2, Level 10, 70 Phillip St, Sydney NSW 2000, Australia T: +61 2 9188 7864 E: lakeresources@lakeresources.com.au

2

Appendix 3B New issue announcement

Rule 2.7, 3.10.3, 3.10.4, 3.10.5

Appendix 3B

New issue announcement, application for quotation of additional securities and agreement

Information or documents not available now must be given to ASX as soon as available. Information and documents given to ASX become ASX’s property and may be made public.

Introduced 01/07/96 Origin: Appendix 5 Amended 01/07/98, 01/09/99, 01/07/00, 30/09/01, 11/03/02, 01/01/03, 24/10/05, 01/08/12, 04/03/13

Name of entity

LAKE RESOURCES N.L.

ABN

49 079 471 980

We (the entity) give ASX the following information.

Part 1 - All issues

You must complete the relevant sections (attach sheets if there is not enough space).

1 +Class of+securities issued or to be issued 2 Number of+securities issued or to be issued (if known) or maximum number which may be issued 3 Principal terms of the+securities (e.g. if options, exercise price and expiry date; if partly paid +securities, the amount outstanding and due dates for payment; if+convertible securities, the conversion price and dates for conversion)	Ordinary Shares (LKE)
	15,000,000
	Ordinary Shares (LKE)

• See chapter 19 for defined terms.

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Appendix 3B New issue announcement

4 Do the+securities rank equally in all respects from the+issue date with an existing+class of quoted +securities? If the additional+securities do not rank equally, please state: • the date from which they do • the extent to which they participate for the next dividend, (in the case of a trust, distribution) or interest payment • the extent to which they do not rank equally, other than in relation to the next dividend, distribution or interest payment 5 Issue price or consideration 6 Purpose of the issue (If issued as consideration for the acquisition of assets, clearly identify those assets) 6a Is the entity an+eligible entity that has obtained security holder approval under rule 7.1A? If Yes, complete sections 6b – 6h_in_ relation to the+securities the subject of this Appendix 3B, and comply with section 6i 6b The date the security holder resolution under rule 7.1A was passed 6c Number of +securities issued without security holder approval under rule 7.1	Yes
	Nil Cash consideration
	Issued in accordance with Controlled Placement Agreement entered into between the Company and Acuity Capital Pty Ltd
	Yes
	30 November 2017
	15,000,000

• See chapter 19 for defined terms.

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Appendix 3B New issue announcement

6d Number of+securities issued with security holder approval under rule 7.1A 6e Number of+securities issued with security holder approval under rule 7.3, or another specific security holder approval (specify date of meeting) 6f Number of+securities issued under an exception in rule 7.2 6g If+securities issued under rule 7.1A, was issue price at least 75% of 15 day VWAP as calculated under rule 7.1A.3? Include the +issue date and both values. Include the source of the VWAP calculation. 6h If+securities were issued under rule 7.1A for non-cash consideration, state date on which valuation of consideration was released to ASX Market Announcements 6i Calculate the entity’s remaining issue capacity under rule 7.1 and rule 7.1A – complete Annexure 1 and release to ASX Market Announcements 7 +Issue dates Note: The issue date may be prescribed by ASX (refer to the definition of issue date in rule 19.12). For example, the issue date for a pro rata entitlement issue must comply with the applicable timetable in Appendix 7A. Cross reference: item 33 of Appendix 3B.	N/A
	N/A
	N/A
	N/A
	N/A
	Refer to Annexure 1
	2 August 2018

• See chapter 19 for defined terms.

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Appendix 3B New issue announcement

8 Number and +class of all +securities quoted on ASX (including the +securities in section 2 if applicable) Number and +class of all +securities not quoted on ASX (including the +securities in section 2 if applicable) 10 Dividend policy (in the case of a trust, distribution policy) on the increased capital (interests)		Number	+Class
		305,683,867 +15,000,000 320,683,867 19,200,000 42,816,667	Ordinary Shares (ASX: LKE) Listed Options (ASX: LKEO) (Exercise price $0.10 and expiry date 27 August 2018) Listed Options (LKEOA) (Exercise price $0.20 and expiry date 15 December 2018)
		Number	+Class
		1. 5,042,494 2. 6,250,000 3. 9,500,000 Total Unlisted Options = 20,752,494 1. 2,500,000	1. Unlisted Options - C Class - Exercise price $0.05, expiry date 30 November 2018 2. Unlisted Options – D Class – Exercise price $0.05, expiry date 21 October 2019 3. Unlisted Options, exercise price $0.28, expiry date 31 December 2020 1. Performance Rights – Under LTI Plan
		N/A

• See chapter 19 for defined terms.

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Appendix 3B New issue announcement

Part 2 - Pro rata issue

art 2 - Pro rata issue
11 Is security holder approval required? 12 Is the issue renounceable or non- renounceable? 13 Ratio in which the +securities will be offered 14 +Class of +securities to which the offer relates 15 +Record date to determine entitlements 16 Will holdings on different registers (or subregisters) be aggregated for calculating entitlements? 17 Policy for deciding entitlements in relation to fractions 18 Names of countries in which the entity has security holders who will not be sent new offer documents Note: Security holders must be told how their entitlements are to be dealt with. Cross reference: rule 7.7. 19 Closing date for receipt of acceptances or renunciations 20 Names of any underwriters 21 Amount of any underwriting fee or commission 22 Names of any brokers to the issue 23 Fee or commission payable to the broker to the issue	N/A
	N/A
	N/A
	N/A
	N/A
	N/A
	N/A
	N/A
	N/A
	N/A
	N/A
	N/A
	N/A

• See chapter 19 for defined terms.

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Appendix 3B New issue announcement

24 Amount of any handling fee payable to brokers who lodge acceptances or renunciations on behalf of security holders 25 If the issue is contingent on security holders’ approval, the date of the meeting 26 Date entitlement and acceptance form and offer documents will be sent to persons entitled 27 If the entity has issued options, and the terms entitle option holders to participate on exercise, the date on which notices will be sent to option holders 28 Date rights trading will begin (if applicable) 29 Date rights trading will end (if applicable) 30 How do security holders sell their entitlements in full through a broker? 31 How do security holders sell part of their entitlements through a broker and accept for the balance? 32 How do security holders dispose of their entitlements (except by sale through a broker)? 33 +Issue date	N/A
	N/A
	N/A
	N/A
	N/A
	N/A
	N/A
	N/A
	N/A
	N/A

• See chapter 19 for defined terms.

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Appendix 3B New issue announcement

Part 3 - Quotation of securities

You need only complete this section if you are applying for quotation of securities

• 34 Type of[+] securities ( tick one )

• (a) + Securities described in Part 1

• (b)[All other ][+][securities ]

Example: restricted securities at the end of the escrowed period, partly paid securities that become fully paid, employee incentive share securities when restriction ends, securities issued on expiry or conversion of convertible securities

Entities that have ticked box 34(a)

Additional securities forming a new class of securities

Tick to indicate you are providing the information or documents

• 35 If the[+] securities are[+] equity securities, the names of the 20 largest holders of the additional[+] securities, and the number and percentage of additional[+] securities held by those holders

36 If the[+] securities are[+] equity securities, a distribution schedule of the additional + securities setting out the number of holders in the categories

• 1 - 1,000

1,001 - 5,000 5,001 - 10,000 10,001 - 100,000 100,001 and over

37 A copy of any trust deed for the additional[+] securities

Entities that have ticked box 34(b)

38 Number of[+] securities for which + quotation is sought

39 + Class of + securities for which quotation is sought

• See chapter 19 for defined terms.

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Appendix 3B New issue announcement

40 Do the[+] securities rank equally in all respects from the[+] issue date with an existing + class of quoted + securities? If the additional[+] securities do not rank equally, please state:

• the date from which they do

• • the extent to which they participate for the next dividend, (in the case of a trust, distribution) or interest payment

• • the extent to which they do not rank equally, other than in relation to the next dividend, distribution or interest payment

• 41 Reason for request for quotation now

Example: In the case of restricted securities, end of restriction period

(if issued upon conversion of another[+] security, clearly identify that other[+] security)

Number + Class

42 Number and[+] class of all[+] securities quoted on ASX ( including the + securities in clause 38)

• See chapter 19 for defined terms.

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Appendix 3B New issue announcement

Quotation agreement

• 1 + Quotation of our additional + securities is in ASX’s absolute discretion. ASX may quote the[+] securities on any conditions it decides.

• 2 We warrant the following to ASX.

• The issue of the[+] securities to be quoted complies with the law and is not for an illegal purpose.

• There is no reason why those[+] securities should not be granted[+] quotation.

• An offer of the[+] securities for sale within 12 months after their issue will not require disclosure under section 707(3) or section 1012C(6) of the Corporations Act.

Note: An entity may need to obtain appropriate warranties from subscribers for the securities in order to be able to give this warranty

• Section 724 or section 1016E of the Corporations Act does not apply to any applications received by us in relation to any[+] securities to be quoted and that no-one has any right to return any[+] securities to be quoted under sections 737, 738 or 1016F of the Corporations Act at the time that we request that the[+] securities be quoted.

• If we are a trust, we warrant that no person has the right to return the + securities to be quoted under section 1019B of the Corporations Act at the time that we request that the[+] securities be quoted.

• 3 We will indemnify ASX to the fullest extent permitted by law in respect of any claim, action or expense arising from or connected with any breach of the warranties in this agreement.

• 4 We give ASX the information and documents required by this form. If any information or document is not available now, we will give it to ASX before + quotation of the + securities begins. We acknowledge that ASX is relying on the information and documents. We warrant that they are (will be) true and complete.

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Sign here: ............................................................ Date: 2 August 2018 Print name: Andrew Bursill

• See chapter 19 for defined terms.

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Appendix 3B New issue announcement

Appendix 3B – Annexure 1

Calculation of placement capacity under rule 7.1 and rule 7.1A for eligible entities

Introduced 01/08/12 Amended 04/03/13

Part 1

Rule 7.1 – Issues exceeding 15% of capital

Step 1: Calculate “A”, the base figure from which the placement capacity is calculated

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Insert number of fully paid [+] ordinary 227,493,026
securities on issue 12 months before the
+ issue date or date of agreement to issue
Add the following: 78,190,841
• Number of fully paid [+] ordinary
securities issued in that 12 month
period under an exception in rule 7.2
• Number of fully paid [+] ordinary
securities issued in that 12 month
period with shareholder approval
• Number of partly paid [+] ordinary
securities that became fully paid in that
12 month period
Note:
• Include only ordinary securities here –
other classes of equity securities
cannot be added
• Include here (if applicable) the
securities the subject of the Appendix
3B to which this form is annexed
• It may be useful to set out issues of
securities on different dates as
separate line items
Subtract the number of fully paid 0
+ ordinary securities cancelled during that
12 month period
“A” 305,683,867
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• See chapter 19 for defined terms.

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Appendix 3B New issue announcement

Step 2: Calculate 15% of “A” “B” 0.15 [Note: this value cannot be changed] Multiply “A” by 0.15 45,852,580

Step 3: Calculate “C”, the amount of placement capacity under rule 7.1 that has already been used

• Insert number of[+] equity securities issued 15,000,000 or agreed to be issued in that 12 month period not counting those issued: • Under an exception in rule 7.2 • Under rule 7.1A • With security holder approval under rule 7.1 or rule 7.4

• Note: • This applies to equity securities, unless specifically excluded – not just ordinary securities

• • Include here (if applicable) the securities the subject of the Appendix 3B to which this form is annexed

• • It may be useful to set out issues of securities on different dates as separate line items 15,000,000

• “C”

Step 4: Subtract “C” from [“A” x “B”] to calculate remaining placement capacity under rule 7.1

“A” x 0.15 45,852,580 Note: number must be same as shown in Step 2 Subtract “C” 15,000,000 Note: number must be same as shown in Step 3 Total [“A” x 0.15] – “C” 30,852,580 Note: this is the remaining placement capacity under rule 7.1

Part 2

• See chapter 19 for defined terms.

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Appendix 3B New issue announcement

Rule 7.1A – Additional placement capacity for eligible entities Step 1: Calculate “A”, the base figure from which the placement capacity is calculated “A” 305,683,867 Note: number must be same as shown in Step 1 of Part 1 Step 2: Calculate 10% of “A” “D” 0.10 [Note: this value cannot be changed] Multiply “A” by 0.10 30,568,387 Step 3: Calculate “E”, the amount of placement capacity under rule 7.1A that has already been used Insert number of[+] equity securities issued or agreed to be issued in that 12 month 0 period under rule 7.1A Notes: • This applies to equity securities – not just ordinary securities • Include here – if applicable – the securities the subject of the Appendix 3B to which this form is annexed • Do not include equity securities issued under rule 7.1 (they must be dealt with in Part 1), or for which specific security holder approval has been obtained • It may be useful to set out issues of securities on different dates as separate line items “E” 0

• See chapter 19 for defined terms.

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Appendix 3B New issue announcement

Step 4: Subtract “E” from [“A” x “D”] to calculate remaining placement capacity under rule 7.1A
“A” x 0.10 Note: number must be same as shown in Step 2	30,568,387
Subtract“E” Note: number must be same as shown in Step 3	0
Total[“A” x 0.10] – “E”	30,568,387 Note: this is the remaining placement capacity under rule 7.1A

• See chapter 19 for defined terms.

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Appendix 3B Page 13