Snow Lake Resources (LITM) Risk Analysis

Our financial statements have been prepared on a going concern basis under which an entity is considered to be able to realize its assets and satisfy its liabilities in the ordinary course of operations. Our future operations are dependent upon the identification and successful completion of equity or debt financing and the achievement of profitable operations at an indeterminate time in the future. There can be no assurances that we will be successful in completing an equity or debt financing or in achieving or maintaining profitability. Our financial statements included in this Annual Report do not give effect to any adjustments relating to the carrying values of assets and liabilities and reported revenues and expenses, and classifications of statements of financial position that would be necessary if we were unable to realize our assets and settle our liabilities as a going concern in the normal course of operations.

We were formed in May 2018 and we have not yet begun commercial production. Our limited operating history makes evaluating our business and future prospects difficult and may increase the risk of your investment. To date, we have not generated any revenue. We have incurred significant losses since our inception. For the years ended June 30, 2025 and 2024, we incurred net losses of C$16.0 million (approximately US$11.7 million) and C$6.9 million (approximately US$5.0 million, based on the daily average exchange rate on June 28, 2024), respectively. As of June 30, 2025, we had an accumulated deficit of C$42.5 million (approximately US$31.2 million). We expect to continue to incur significant expenses and operating losses for the foreseeable future as we continue to conduct exploration and development activities on our mineral resource projects. All of our current projects are at the exploration stage, and are subject to the substantial risks and uncertainties discussed in this "Risk Factors" section and elsewhere in this Annual Report. There is no guarantee that any exploration efforts with respect to such projects will result in commercial production or that we will ever become profitable. Our failure to achieve or sustain profitability could negatively impact the value of our securities and have a material adverse effect on our prospects.

As a public company, we face increased legal, accounting, administrative and other costs and expenses that we did not incur as a private company. We are subject to the reporting requirements of the U.S. Securities Exchange Act of 1934, as amended, or the Exchange Act, which requires that we file annual and other reports with respect to our business and financial condition, as well as the rules and regulations implemented by the U.S. Securities and Exchange Commission, or SEC, the Sarbanes-Oxley Act, the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010, the Public Company Accounting Oversight Board, or PCAOB, and the continued listing requirements of Nasdaq, each of which imposes additional reporting and other obligations on public companies. As a public company, we are required to, among other things: - prepare and file annual and other reports in compliance with U.S. federal securities laws;- expand the roles and duties of our board of directors and committees thereof and management;- hire additional financial and accounting personnel and other experienced accounting and finance staff with the expertise to address complex accounting matters applicable to public companies;- institute more comprehensive financial reporting and disclosure compliance procedures;- involve and retain, outside counsel and accountants to assist us with the activities listed above;- build and maintain an investor relations function;- establish new internal policies, including those relating to trading in our securities and disclosure controls and procedures;- comply with the listing and maintenance requirements of Nasdaq; and - comply with the Sarbanes-Oxley Act. We expect these rules and regulations, and any future changes in laws, regulations and standards relating to corporate governance and public disclosure, which have created uncertainty for public companies, to require us to continue to incur legal and financial compliance costs and make some activities more time consuming and costly than for private companies. These laws, regulations and standards are subject to varying interpretations, in many cases, due to their lack of specificity, and, as a result, their application in practice may evolve over time as new guidance is provided by regulatory and governing bodies. This could result in continuing uncertainty regarding compliance matters and higher costs necessitated by ongoing revisions to disclosure and governance practices. Our investment in compliance with existing and evolving regulatory requirements has resulted, and will continue to result, in increased administrative expenses and a diversion of management's time and attention from revenue-generating activities to compliance activities, which could continue to have a material adverse effect on our business, financial condition and results of operations. We currently qualify as an "emerging growth company" as defined in the U.S. Securities Act of 1933, as amended, or the Securities Act, as modified by the Jumpstart Our Business Startups Act of 2012, or the JOBS Act, and are therefore permitted to take advantage of certain reduced reporting requirements and other exemptions from obligations applicable to larger public companies. When we cease to qualify as an emerging growth company, we will become subject to additional reporting and compliance requirements that will increase our costs and the demands on our resources. The additional obligations of being a fully reporting public company may require us to hire additional personnel, engage additional outside advisors, and devote greater management attention to compliance, all of which could increase our operating expenses and adversely affect our business, financial condition and results of operations. We also currently qualify as a "foreign private issuer" under SEC rules, which allows us to file our annual reports on Form 20-F, to follow certain of our home country's corporate governance practices in lieu of certain U.S. requirements, and to benefit from reduced reporting obligations compared to U.S. domestic issuers. If we were to lose our status as a foreign private issuer, we would be required to comply with the more extensive periodic reporting requirements applicable to U.S. domestic issuers, including the obligation to file quarterly reports on Form 10-Q and current reports on Form 8-K, to prepare financial statements in accordance with U.S. GAAP rather than IFRS as issued by the IASB, and to comply fully with the proxy solicitation rules and certain executive compensation disclosure requirements of the SEC. The loss of foreign private issuer status would significantly increase our regulatory and compliance costs and the demands placed on our management and administrative resources, which could have a material adverse effect on our business, financial condition and results of operations. Furthermore, pursuing these opportunities may divert management's attention and resources from our core business activities, expose us to unforeseen liabilities, or result in conflicts of interest.

We may not be able to achieve the expected benefits of our recent acquisitions and investments, and there can be no assurance that any of such acquisitions and investments will be beneficial to us. Our assessment and estimates of the properties involved in such acquisitions and investments have been limited and may prove to be incorrect. Our assessment may not have revealed all existing or potential problems. We have assumed risks that some or all of such properties may not perform in accordance with our expectations, and we may be left with no recourse for liabilities and other problems associated with some or all of such properties. The market price of our securities may decline as a result of such acquisitions and investments if, among other things, some or all of the properties involved are not successfully developed or if the liabilities, expenses, defects, or transaction costs related to some or all of such properties are greater than expected. The market price of our securities may also decline if we do not achieve the perceived benefits of some or all of such acquisitions and investments as rapidly or to the extent anticipated by us or by securities market participants or if the effect of some or all of such acquisitions and investments on our business, results of operations or financial condition or prospects is not consistent with our expectations or those of securities market participants.