Communicators

Rock Tech Lithium: Letter to Shareholders

May 9, 2016

Dear Fellow Shareholders,

At the end of 2012, with the market price of lithium carbonate around USD$5,000/tonne and anticipated surplus supply in world markets, further development of our Georgia Lake lithium project was deferred.  Over the past few years, our share price, that reached a high of CAD$0.40 five years ago with a market cap of more than CAD$30 million, fell along with most other exploration companies.  A planned diversification through a reverse takeover was abandoned and a restructuring of the company was needed.

When I assumed the role of Chief Executive Officer in early 2015, I needed to make decisions on how to best position the company for the future.  I, along with my fellow directors and management team, substantially reduced the company’s debt load through a mix of non-core asset sales and shares-for-debt agreements, allowing the company to better navigate the historic downturn in commodity markets.

Owing in large part to the dramatic growth of the e-mobility sector, the market environment for lithium companies has improved significantly in the past few months.  As the name suggests, lithium is a key ingredient of lithium-ion batteries, the preferred battery technology of today’s electric vehicle manufacturers.  A recent article in The Economist stated that lithium carbonate prices in China reached USD$13,000/tonne at the end of 2015 while CRU Group, an independent market analysis firm, reports Chinese spot prices of over USD$20,000/tonne more recently.  At the recent unveiling of the new mass-market Model 3, Tesla Motors’ Chief Executive Officer, Elon Musk, stated that when their $5 billion Gigafactory in Nevada reaches full production, it will absorb the entire world’s lithium production.  While Tesla garners the majority of publicity in the electric vehicle market, they are certainly not alone with Chevrolet, Nissan, BMW, Ford and others adding electric vehicles to their product offerings.  BYD Auto Co., Ltd. and other start-ups in China are also ramping up battery production.  In fact, as reported by CRU Group, over 90% of new lithium-ion battery manufacturing projects are located in China.  Future demand looks to be robust and, as a result, lithium supply must increase significantly.  With few commercialized substitutes available, the market price for lithium has increased sharply.

Based on market fundamentals and forecasts for supply and demand, we are confident that the outlook for lithium and for our Georgia Lake lithium project has never before been so positive.  Since acquiring the property in 2009, we have made significant investments in resource definition at the Georgia Lake project including trenching, drilling, bulk sampling and metallurgical testing.  As a result of these investments, we completed the first-ever NI 43-101 compliant resource estimate on the property, details of which can be found on our webpage – www.rocktechlithium.com.  We are excited about the project and are eager to resume exploration and development work.

Including the recently closed shares-for-debt transaction, the company still has less than 20 million shares outstanding (25 million on a fully-diluted basis) and a market capitalization of around CAD$6 million.  Over 40% of our outstanding shares are held by insiders with a further 10-20% held by ardently supportive long-term retail and institutional investors.  Over the past several months, I have increased my shareholdings of the company, predominantly through open-market acquisitions.  All transactions of directors and managers are filed on SEDI and can be viewed at www.canadianinsider.com; the latest 10 transactions available for non-subscribers.  In addition to being listed on the TSX Venture Exchange in Canada, our shares are also tradable in Frankfurt, Stuttgart and at Tradegate Exchange in Berlin.

Lithium has proven to be an exception in what remains a weak commodities market and, in my view, the strong bullish trend in the lithium sector will remain intact.  While there has been a rush to acquire lithium properties by both incumbents and the plethora of new entrants to the lithium exploration space, we are one of the few junior explorers that have made a significant investment in exploration and published an NI43-101 compliant resource estimate.

We are confident that the triumphal procession of electric vehicles is only beginning and that lithium will remain in the spotlight for the foreseeable future.

Best,

Martin Stephan,

CEO Rock Tech Lithium,

mstephan@rocktechlithium.com

Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.

Statements included in this announcement, including statements concerning our plans, intentions and expectations, which are not historical in nature are intended to be, and are hereby identified as, “forward‐looking statements”.  Forward‐looking statements may be identified by words including “anticipates”, “believes”, “intends”, “estimates”, “expects” and similar expressions.  The Company cautions readers that forward‐looking statements, including without limitation those relating to the Company’s future operations and business prospects, are subject to certain risks and uncertainties that could cause actual results to differ materially from those indicated in the forward‐looking statements.