MEC RESOURCES LIMITED — Capital/Financing Update 2020

Jan 15, 2020

ASX Release

16 JANUARY 2020

==> picture [114 x 48] intentionally omitted <==

UPDATE TO EXPANDED INVESTMENT MANDATE

MEC Resources Ltd ( MEC or the Company ) wishes to advise shareholders of the following:

1. the Company previously announced that the Innovation Investment Committee of Innovation and Sc ience Australia has approved MEC’s application to vary its approved investment plan to include investments into existing and start-up enterprises that have demonstrated technology and/or services that may have application not limited to the resources sector (refer to the ASX announcement dated 13 March 2019 for further details);

2. on 1 November 2019, MEC acquired 3.19% of the shares in Intelligent IP Hosting Pty Ltd trading as Claratti Workspace ( Claratti ), a managed services provider of cloud based IT infrastructure, service and software, for consideration of A$100,000 ( Initial Investment ). No announcement was made in respect to the Initial Investment as the Company had considered the Initial Investment to be immaterial;

3. ASX has advised that the expansio n of the Company’ s mandate constitutes a change in the nature of the Company’s activities and requires the Company to seek shareholder approval pursuant to Listing Rule 11.1.2 and re-comply with Chapters 1 and 2 of the Listing Rules pursuant to Listing Rule 11.1.3;

4. having regard to the above, the Company has agreed to divest its existing minority investment of 3.19% in Claratti and, as at the date of this announcement, does not hold any shares in Claratti; and

5. the Company intends to convene a meeting of shareholders to consider (amongst other matters) the necessary resolutions to proceed with an investment in Claratti and any other potential investments under its expanded mandate.

Subject to (amongst other matters) the Company obtaining the requisite shareholder approval and re-complying with Chapters 1 and 2 of the Listing Rules, the Company intends to invest in Claratti ’ s business and acquire at least 10% of the issued capital of Claritti. The Company will not undertake an investment in Claratti if the requisite shareholder approval is not obtained and/or it is unable to satisfy the requirements under Chapters 1 and 2 of the Listing Rules. The Company will provide shareholders with an update in respect to status and progress by way of further ASX announcements.

Ends

This announcement has been approved by the Board of Directors of MEC.

For further information contact:

Andrew Bald MEC Resources Limited Director ACN 113 900 020

M: E:

P:

P: 08 9217 2456 E: info@mecresources.com.au W: www.mecresources.com.au

Important Notice

Some of the statements appearing in this announcement may be in the nature of forward-looking statements. You should be aware that such statements are only predictions and are subject to inherent risks and uncertainties. Those risks and uncertainties include factors and risks specific to the industries in which MEC operates and proposes to operate as well as general economic conditions, prevailing exchange rates and interest rates and conditions in the financial markets, among other things. Actual events or results may differ materially from the events or results expressed or implied in any forward-looking statement. No forward-looking statement is a guarantee or representation as to future performance or any other future matters, which will be influenced by a number of factors and subject to various uncertainties and contingencies, many of which will be outside MEC ’s control.

MEC does not undertake any obligation to update publicly or release any revisions to these forwardlooking statements to reflect events or circumstances after today's date or to reflect the occurrence of unanticipated events. No representation or warranty, express or implied, is made as to the fairness, accuracy, completeness or correctness of the information, opinions or conclusions contained in this announcement. To the maximum extent permitted by law, none of MEC, its Directors, employees, advisors or agents, nor any other person, accepts any liability for any loss arising from the use of the information contained in this announcement. You are cautioned not to place undue reliance on any forward-looking statement. The forward-looking statements in this announcement reflect views held only as at the date of this announcement.

This announcement is not an offer, invitation or recommendation to subscribe for, or purchase securities by MEC. Nor does this announcement constitute investment or financial product advice (nor tax, accounting or legal advice) and is not intended to be used for the basis of making an investment decision. Investors should obtain their own advice before making any investment decision. By reviewing or retaining this announcement, you acknowledge and represent that you have read, understood and accepted the terms of this important notice.

2 | P a g e