Letter to Shareholders

Simon Bodensteiner, Chief Executive Officer

Dear Shareholders,


As you have seen, we recently published several important announcements which demonstrate clearly the accelerating momentum of our activities of the past months. While we are well on the way to being a significant lithium supplier for the western automotive industry, we are also investing in new processes and technologies. I would like to put our recent news into a broader context:


  1. Last week, we published our first economic feasibility study (PEA) on a vertically integrated lithium hydroxide converter in Canada - the first company ever to do so in the Great Lakes region, where the leading U.S. car companies are located. The PEA examined two alternatives and achieved excellent results. Our production costs will be in the lowest quartile of global producers, with a pre-tax net present value(NPV) above US$1 billion and a pre-tax IRR beyond 30%. We are now entering the next phase and have kicked off our Pre-Feasibility Study (PFS). In the PFS, we will also consider the first lithium hydroxide converter in Europe since our primary goal is to supply the rapidly growing European electric vehicle industry with battery-grade lithium hydroxide! We believe that the European EV market is several years ahead of its North American counterpart. We will be the first company to build the bridge that Europe so desperately needs by securing raw material supply from stable, western jurisdictions (Canada) and refining on-site in Europe. Accordingly, we have also joined ERMA (European Raw Materials Alliance), the newly established European Union initiative for the construction of metal refineries and converters, as a founding member. We are already in advanced negotiations regarding subsidies, locations and strategic partnerships in Germany and other countries in Europe.
  2. Yesterday, we published the filing of our first patent application - a significant step for RockTech. In cooperation with Prof. Wolfgang Voigt of TU Bergakademie Freiberg, Germany, we have developed a new and innovative lithium hydroxide production process, the so-called "nitrate process." With this process we want nothing less than to replace the sulfate process which is currently used in most lithium converters in operation worldwide. By reducing energy consumption and converting waste streams into valuable by-products, our process is likely to be more cost-effective and environmentally friendly.. With this patent pending, along with other research and development initiatives that our team is working on, we are getting closer to our goal of turning Rock Tech into a ChemTech (chemical technology) company!
  3. To achieve this expeditiously, we are working with the best partners in the industry - companies such as Wave International, Anzaplan, Nagrom, DMT, the GP Papenburg Group and others. We consider them long-term partners for well beyond the upcoming PFS. We are also negotiating with several companies in Ontario, Canada, to develop strategies that allow the processing of third party Canadian lithium resources. We are planning converter capacities which may require more lithium spodumene concentrate than our own future Georgia Lake mine will be able to produce. For this reason, in additional to diversifying operational risk, we will source spodumene concentrate from third parties. Early next year, once we have finalized our operational flowsheets and produced the first batches of lithium hydroxide in our own pilot plant, we will intensify discussions with off-take partners and also with international EPC contractors who will build our plants.
  4. To fund the upcoming studies, we announced this week a private placement of C$5 million. The demand from existing investors is already pleasantly high.

We have achieved a lot in recent months and there is much more to come. In order to progress even quicker, particularly in Europe, we will soon be opening an office in Germany and expanding our team. There are exciting times ahead of us!




Simon Bodensteiner


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