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The parties will establish a European joint-venture that controls Rock Techs Guben Converter in Germany, as well as Arcores Lopare project in Bosnia-Herzegovina. The business combination will cover the entire value chain from mine to battery-grade Lithium products. This fully integrated supply chain will ensure a reliable battery materials supply for Europe, create operational synergies, lower costs and substantially enhance international competitiveness. The binding Business Combination Agreement has been signed on February 19, 2025. Rock Tech will hold 75% control of the newly created company. Closing is targeted for Q2/2025. Rock Tech Lithium Inc. (Rock Tech or the Company) is pleased to announce the signing of a binding Business Combination Agreement (BCA) to form a business combination with Arcore AG (Arcore), an arms length Swiss-based mining company. The goal is to establish a fully integrated Lithium supply chain in Europe, reducing dependence on other regions for critical battery raw materials. Lithium is an essential mineral for the energy transition, and demand in Europe is expected to triple by 2030, driven by the increasing need for batteries in electric vehicles (EVs) and energy storage systems as estimated by McKinsey & Companys Battery Insight Demand Model. Dirk Harbecke, Rock Tech CEO & Chairman, comments: Strong European supply chains are essential to secure the regions strategic autonomy, promote industrial competitiveness and enable the transformation to a climate-neutral economy. Europe is currently heavily dependent on imports of critical raw materials such as lithium. This is an important step for Rock Tech to become the European leader in battery raw materials supply. Jeff Stone, Interim CEO Arcore, states: Caring for this exceptionally vital asset of the Republic of Srpska is a fiduciary duty that we assume with the utmost responsibility. It is with that responsibility in mind that we formally submit our concession application. It is a privilege for Arcore alongside Rock Tech to play a defining role in the creation of an independent European supply chain of critical metals. Vladimir Rudic, Managing Director of Arcore Doo in Bosnia-Herzegovina, adds: The Lopare project, thanks to our collaboration and association with Rock Tech, and their cutting-edge technological innovations, will be the standard bearer of new trends in the development of sustainable mining in this traditional mining region. Formation of NewCo Rock Tech and Arcore will establish a new European entity (NewCo). Upon Closing, it is intended that (i) Rock Tech will contribute the shares of its wholly owned subsidiary Rock Tech Guben GmbH to NewCo and will hold shares in NewCo representing 75% of NewCos registered share capital, and that (ii) ARCORE will contribute the shares of its wholly owned subsidiary AR CORE d.o.o to NewCo and hold shares representing 25% of NewCos registered share capital. The core assets of NewCo will include Rock Techs fully permitted Lithium converter in Guben, Germany, and Arcores lithium-boron-magnesium mining project in Lopare, Bosnia-Herzegovina. It is envisioned that the Lopare project will deliver Lithium Sulphate feedstock (produced at site) to the Guben Converter from 2030 onwards; in addition to the already secured spodumene supply from contracted partners. Utilizing Lithium Sulphate as future feedstock is a key step in establishing a circular Lithium economy and reducing production costs significantly. This approach aligns with Rock Techs recycling flowsheet, for which Lithium Sulphate from black mass recycling is used and subsequently refined into battery-grade Lithium hydroxide at Rock Techs converters. By processing Lithium raw material to Lithium Sulphate at-site in Lopare an important value-adding step will remain in-country. As leading partner of the NewCo, Rock Tech will engage closely with the local communities as part of the permitting process, leveraging its expertise gained from developing its Georgia Lake lithium project in Canada. The Arcore deposit will be developed in cooperation with local stakeholders and in compliance with the strictest environmental, social, and governance (ESG) standards. The company plans to obtain certification under the Initiative for Responsible Mining Assurance (IRMA) standard. The Projects Guben Lithium Converter The centerpiece of Rock Techs European activities is its planned Lithium-Hydroxide Monohydrate (LHM) Converter in the Brandenburg battery cluster, designed to produce battery-grade LHM for up to 500,000 electric vehicles per year. The project is currently in its final financing phase, with all relevant construction, environmental and operation permits and engineering studies completed. The state of Brandenburg supports the project due to its high strategic relevance. Engineering and project management firm Worley Ltd. has been selected as the EPCM provider for the Guben Converter, and LHM offtake agreements as well feedstock supply have been secured. Lopare Lithium Project Arcores mineral deposit in the Lopare region of Bosnia-Herzegovina has the potential to become one of the largest lithium mines in Europe with estimated 600.000 tonnes of Lithium Carbonate Equivalent (LCE). According to the CSA Global Mineral Resource Estimate (MRE), the deposit contains an indicated resource of 426Mt grading 561ppm Li2O and 0.95% B2O3 and an inferred resource of 864Mt grading 579ppm Li2O and 0.67% B2O3, respectively. Beyond lithium and boron, the deposit contains significant concentrations of other valuable minerals. Internal estimates indicate that within the resource area, the material contains an average of 9.41% MgO, 2.3% K2O, and 10.82% Al2O3. While these elements are not included in the reported Mineral Resource Estimate, they highlight the broader economic potential of the deposit. CSA Global Mining Industry Consultants, an ERM Group Company, completed a Mineral Resource Estimate titled Lopare-Boron-Lithium-Project as finalized on November 30 2022 with report number R268.2022. The Mineral Resource Estimate is summarized below in Table 1. Note, Arcore AG being a privately-owned Switzerland-based lithium mining company opted to adhere to Australian JORC Code 2012 guidelines, meaning that such mineral resource estimate may not align fully with the reporting requirements of Canadas National Instrument 43-101. The Lopare deposit remains highly prospective, with significant potential to expand the existing resource through additional exploration and technical studies. While elements such as MgO, K2O, and Al2O3 are not currently included in the Mineral Resource Estimate, ongoing geometallurgical and mineralogical studies will further assess their economic significance. Moreover, exploration beyond the defined Mineral Resource suggests geological continuity, with a significant exploration target. This exploration target highlights the opportunity for further resource growth and optimization through future drilling programs and study work. Following the successful completion of the exploration phase, the project has now applied for a Mining Concession. The first important step in the new joint venture will be the finalization of the pre-feasibility study to further assess the technical scope and quantify the economic benefits of the project. In addition to developing possible mining and processing methods, this study will comprehensively examine the environmental and social compatibility of the project. The study will be carried out by an internationally experienced engineering consultancy company. With this joint venture, Rock Tech and Arcore are taking a significant step toward securing a sustainable, efficient, and competitive lithium supply chain in Europe, reinforcing the continents battery industry and energy transition goals. |