MEC RESOURCES LIMITED — Capital/Financing Update 2023

Feb 21, 2023

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ASX ANNOUNCEMENT

22 February 2023

PLACEMENT - UPDATE

MEC Resources Limited ( “MEC” or the “Company” ) (ASX:MMR) announced on 21 February 2023 that it had raised A$154,388 before costs by way of placement of Shares to professional and sophisticated investors pursuant to section 708 of the Corporations Act 2001 (Cth) at an issue price of $0.0044 per Share under the Company’s LR7.1 placement capacity (“ Placement Shares ”).

This share issue was also accompanied by the issue of one (1) free option for each Share subscribed with an exercise price of 0.0055 and expiry 24 months from the issue date. The Company intends to apply to the ASX to have the options listed if there are 50 or more holders. See Schedule 1 Terms & Conditions.

Funds raised from this capital raising will be utilised by the Company to facilitate its compliance requirements, work associated with moving the Company towards reinstatement to trading on the ASX and general short term working capital requirements.

Placement Details

• Placement completed at an issue price of $0.0044 per Share

• Total amount raised of $154,388 before costs

• Number of fully paid ordinary shares issued 33,488,180

• Number of free attaching options issued 33,488,180 exercisable at $0.0055 with an expiry date 24 months from issue being 21 February 2025.

• Number of fully paid ordinary shares on issue following the placement is 842,651,515

• The Placement Shares are subject to holding lock pending release of a prospectus by the Company

• Placement completed by LeMessurier Securities who will receive a 6% capital raising fee (plus GST)

David Breeze (Managing Director) authorised the release of this announcement to the market.

For further information please contact: David Breeze Managing Director – MEC Resources Limited Ph: +61 409 150 953

MEC Resources Ltd

ACN 113 900 020 Level 1, 9 Bowman Street, South Perth WA 6151 T: +61 8 9217 2400 info@mecresources.com.au www.mecresources.com.au

SCHEDULE 1 - TERMS AND CONDITIONS OF OPTIONS

1. Entitlement

Each Option entitles the holder to subscribe for one Share upon exercise of the Option.

2. Exercise Price

Subject to paragraph 9, the amount payable upon exercise of each Option will be $0.0055 ( Exercise Price ).

3. Expiry Date

Each Option will expire at 5:00 pm ( WST ) two years from the date of issue ( Expiry Date ). An Option not exercised before the Expiry Date will automatically lapse on the Expiry Date.

4. Exercise Period

The Options are exercisable at any time on or prior to the Expiry Date (Exercise Period).

5. Notice of Exercise

The Options may be exercised during the Exercise Period by notice in writing to the Company in the manner specified on the Option certificate ( Notice of Exercise ) and payment of the Exercise Price for each Option being exercised in Australian currency by electronic funds transfer or other means of payment acceptable to the Company.

6. Exercise Date

A Notice of Exercise is only effective on and from the later of the date of receipt of the Notice of Exercise and the date of receipt of the payment of the Exercise Price for each Option being exercised in cleared funds ( Exercise Date ).

7. Timing of issue of Shares on exercise

Within five Business Days after the Exercise Date, the Company will:

• a) issue the number of Shares required under these terms and conditions in respect of the number of Options specified in the Notice of Exercise and for which cleared funds have been received by the Company;

• b) if required, give ASX a notice that complies with section 708A(5) of the Corporations Act, or, if the Company is unable to issue such a notice, lodge with ASIC a prospectus prepared in accordance with the Corporations Act and do all such things necessary to satisfy section 708A(11) of the Corporations Act to ensure that an offer for sale of the Shares does not require disclosure to investors; and

• c) if admitted to the official list of ASX at the time, apply for official quotation on ASX of Shares issued pursuant to the exercise of the Options.

If a notice delivered under 7(b) for any reason is not effective to ensure that an offer for sale of the Shares does not require disclosure to investors, the Company must, no later than 20 Business Days after becoming aware of such notice being ineffective, lodge with ASIC a prospectus prepared in accordance with the Corporations Act and do all such things necessary to satisfy section 708A(11) of the Corporations Act to ensure that an offer for sale of the Shares does not require disclosure to investors.

8. Shares issued on exercise

Shares issued on exercise of the Options rank equally with the then issued shares of the Company.

9. Reconstruction of capit al

• If at any time the issued capital of the Company is reconstructed, all rights of an Optionholder are to be changed in a manner consistent with the Corporations Act and the ASX Listing Rules at the time of the reconstruction.

10. Participation in new issues

There are no participation rights or entitlements inherent in the Options and holders will not be entitled to participate in new issues of capital offered to Shareholders during the currency of the Options without exercising the Options.

11. Change in exercise price

An Option does not confer the right to a change in Exercise Price or a change in the number of underlying securities over which the Option can be exercised.

12. Transferability

The Options are transferable subject to any restriction or escrow arrangements imposed by ASX or under applicable Australian securities laws.

13. ASX Listing

The Company intends to apply to the ASX to have the options listed if there are 50 or more holders.