Sirocco and Canada Lithium Enter Into Definitive Arrangement Agreement

Sirocco Mining Inc. and Canada Lithium Corp. jointly announce that their respective boards of directors have approved, and that they have entered into, a definitive agreement pursuant to which they will complete a business combination by way of a statutory Plan of Arrangement under the Canada Business Corporations Act.

Following the completion of the Arrangement, the current Canada Lithium shareholders will hold approximately 58% of the combined company, while current shareholders of Sirocco will hold approximately 42%.

Highlights of the Arrangement Include:

• The business combination of Sirocco with its established Aguas Blancas iodine mine in Chile and Canada Lithium with its commissioning-stage lithium project in Quebec will create a significant industrial minerals producer in both the iodine and lithium markets. It is anticipated the combined company will provide significant market and growth synergies and over-all cost reduction.
• Sirocco's balance sheet and cash flow de-risk the production ramp-up of Canada Lithium's project. In addition, the combined company with its stronger balance sheet will offer greater cash resources.
• Anticipated ongoing growth in the automotive and electronics sector will continue to drive demand for lithium products, while anticipated increasing applications for X-ray media in Asia will continue to support iodine consumption. This allows for diversification of revenue and market risks. In the short to medium term, there is potential for downstream, value-added growth into lithium metal, potassium and sodium nitrates, sodium sulphate and lithium hydroxide.
• New and continued developments in the lithium battery sector, specifically lithium-iodine technology, which demonstrates higher energy levels and increased battery performance over current lithium battery technologies, may provide the combined company increased market opportunities as uptake of these new battery applications increases.
• The combination of Canada Lithium and Sirocco results in only one of two public companies, the other being SQM of Chile, producing both iodine and lithium.
• Following the closing of the Arrangement, the current Sirocco management team will be appointed as officers of the combined company: Richard P. Clark, as Chief Executive Officer, Alessandro Bitelli, as Chief Financial Officer, Kevin Ross, as Chief Operating Officer and Hugh Stuart, as Vice President of Exploration. This is the core team that contributed to the growth of Red Back Mining's operations, which was acquired by Kinross Gold Corporation for $9.2 billion.
• Sirocco shareholders will receive 1.175 common shares (on a pre-consolidated basis) in the capital of Canada Lithium for each outstanding Sirocco common share. Pursuant to the transaction, Canada Lithium expects to issue approximately 294 million common shares (on a pre-consolidation and non-diluted basis).
• The Arrangement values each Sirocco share at C$0.48 representing a premium of approximately 23% to the 20-day volume weighted average price of the Sirocco common shares on the Toronto Stock Exchange as of December 3, 2013.
• The Arrangement has been approved by the board of directors of both companies. Following the closing of the Arrangement, the board of the combined company will be comprised of nine individuals. Four of the nine will be Canada Lithium nominees, with the remaining five individuals to be nominated by Sirocco.
• In connection with the Arrangement, Canada Lithium will consolidate its common shares on the basis of one post-consolidation common share for each three existing Canada Lithium common shares.