Largo Inc.

In May 2024, a further working capital debt facility with a term of 60 days was secured with another bank in Brazil for a total limit of $2,000 and an interest rate of 8.65% p.a. The Company received $1,914 from this facility in May 2024 and it was repaid in full in July 2024. In August 2024, the Company received $1,799 from this facility and it was repaid in full in October 2024.

On June 25, 2024, the Company signed an inventory financing agreement for up to $10,000. Under the terms of this facility, which has a term until December 31, 2025 for the receipt of funds and a further four months for the repayment of amounts received, the Company can use its vanadium finished products inventory to secure drawdowns of up to $10,000 for a maximum period of 100 days. Amounts repaid include a commission fee of 1%, interest at a rate of the one month U.S. Secured Overnight Financing Rate ("SOFR") plus 3.0% and other direct costs. The Company began drawing down on this facility in July 2024.

On July 5, 2024, the Company signed an additional inventory financing agreement for up to $10,000. Under the terms of this facility, which has a term until June 30, 2026, the Company can use its vanadium finished products inventory to secure drawdowns of up to $10,000 for a maximum period of 90 days. Amounts repaid include a commission fee of 1%, interest costs and other direct costs. The Company began drawing down on this facility in July 2024.

Capital resources

At December 31, 2024, the Company had an accumulated deficit of $126,496 since inception (December 31, 2023 - $77,643) and had a net working capital deficit of $20,972 (December 31, 2023 - surplus of $94,668) (defined as current assets less current liabilities). At December 31, 2024, the total amount due within 12 months on the Company's debt was $74,780 (December 31, 2023 - $nil).

The following table details the Company's expected remaining contractual cash flow requirements at December 31, 2024 for its liabilities and commitments with agreed repayment periods. The amounts presented are based on the undiscounted cash flows and therefore, may not equate to the carrying amounts on the consolidated statement of financial position.

The Company's approach to managing liquidity risk is to ensure that it will have sufficient liquidity to meet liabilities when due. The Company's principal sources of liquidity are its cash flow from operating activities and cash of $22,106 (December 31, 2023 - $42,714). Refer to note 20 for other commitments and contingencies. As a consequence of vanadium price fluctuations in recent years, a risk may exist that the Company will not have sufficient liquidity to meet its obligations as they come due.

Outstanding Share Data

(Exercise prices presented in this section are in Canadian dollars and not in thousands).

At December 31, 2024, there were 64,112 common shares of the Company outstanding. At the date of this MD&A, there were 64,112 common shares of the Company outstanding.

At December 31, 2024, under the share compensation plan of the Company, 70 RSUs were outstanding and 2,144 stock options were outstanding with exercise prices ranging from C$2.51 to C$19.52 and expiry dates ranging between March 24, 2025 and August 13, 2029. If exercised, the Company would receive proceeds of C$9,995. The weighted average exercise price of the stock options outstanding is C$4.66.

Management's Discussion and Analysis for the Year Ended December 31, 2024 16