METALS AUSTRALIA LTD — Capital/Financing Update 2018

Feb 14, 2018

Appendix 3B New issue announcement

Rule 2.7, 3.10.3, 3.10.4, 3.10.5

Appendix 3B

New issue announcement, application for quotation of additional securities and agreement

Information or documents not available now must be given to ASX as soon as available. Information and documents given to ASX become ASX’s property and may be made public.

Introduced 01/07/96 Origin: Appendix 5 Amended 01/07/98, 01/09/99, 01/07/00, 30/09/01, 11/03/02, 01/01/03, 24/10/05, 01/08/12, 04/03/13

Name of entity

METALS AUSTRALIA LTD

ABN

38 008 982 474

We (the entity) give ASX the following information.

Part 1 - All issues

You must complete the relevant sections (attach sheets if there is not enough space).

1 +Class of +securities issued or to (a) Fully Paid Ordinary be issued (b) Options (c) Options 2 Number of[+] securities issued or (a) 669,975,000 Shares to be issued (if known) or (b) 669,975,000 Options maximum number which may (c) 30,000,000 Options be issued 3 Principal terms of the +securities (e.g. if options, (a) Fully Paid Ordinary exercise price and expiry date; if (b) Options exercisable at $0.01 each, on partly paid +securities, the or before 31 May 2020 amount outstanding and due (c) Options exercisable at $0.01 each, on dates for payment; if or before 31 May 2020 +convertible securities, the conversion price and dates for conversion)

• See chapter 19 for defined terms.

Appendix 3B Page 1

04/03/2013

Appendix 3B New issue announcement

4 Do the+securities rank equally in all respects from the+issue date with an existing+class of quoted+securities? If the additional+securities do not rank equally, please state:  the date from which they do  the extent to which they participate for the next dividend, (in the case of a trust, distribution) or interest payment  the extent to which they do not rank equally, other than in relation to the next dividend, distribution or interest payment 5 Issue price or consideration 6 Purpose of the issue (If issued as consideration for the acquisition of assets, clearly identify those assets) 6a Is the entity an+eligible entity that has obtained security holder approval under rule 7.1A? If Yes, complete sections 6b – 6h in relation to the+securities the subject of this Appendix 3B, and comply with section 6i 6b The date the security holder resolution under rule 7.1A was passed 6c Number of+securities issued without security holder approval under rule 7.1	(a) Yes, the Shares rank equally in all respects from the date of issue with the existing quoted fully paid ordinary shares of the Company. (b) No, these Options do not rank equally with other Securities of the Company. However, the shares issued upon exercise of the Options will rank equally in all respects from the date of issue with the existing quoted Ordinary Fully Paid Shares of the Company. (c) No, these Options do not rank equally with other Securities of the Company. However, the shares issued upon exercise of the Options will rank equally in all respects from the date of issue with the existing quoted Ordinary Fully Paid Shares of the Company.
	(a) $0.05 (b) Nil. The Options are issued free attaching to the Shares issued under (a) on a 1:1 basis. (c) Nil. The Options are issued to employees and consultants.
	To continue exploration at the Lac Rainy Graphite Project and also at the Manindi Zinc Project, together with debt repayment and ongoing working capital.
	Yes
	16 November 2017
	173,043,000

• See chapter 19 for defined terms.

Appendix 3B Page 2

04/03/2013

Appendix 3B New issue announcement

6d Number of[+] securities issued with security holder approval 166,907,000 under rule 7.1A 6e Number of[+] securities issued Issue of 500,000,000 Shares and 500,000,000 with security holder approval Options approved by shareholders at an Annual under rule 7.3, or another General Meeting on 16 November 2017. 30,000,000 Options for staff and consultants specific security holder approval also approved by shareholders at an Annual (specify date of meeting) General Meeting on 16 November 2017. 6f Number of[+] securities issued Nil under an exception in rule 7.2 6g If[+] securities issued under rule Yes. Issued under rule 7.1A. 7.1A, was issue price at least 75% of 15 day VWAP as calculated The issue price of the Shares ($0.005) was agreed on 12 February 2018 and the Shares under rule 7.1A.3? Include the +issue date and both values. were issued on 15 February 2018. Include the source of the VWAP The 15 day VWAP calculated prior to 12 calculation. February 2018, being the date on which the price was agreed (therefore calculated over the period from 19 January 2018 to 9 February 2018 which are days on which sales in MLS are recorded), was $0.00664 and 75% of the 15 day VWAP was $0.00498. The CommSec website which provides daily volume and sale prices based on trades completed on the ASX was used as the source of the historical trading prices for MLS shares and for the calculation of the 15 day VWAP.

6h If[+] securities were issued under rule 7.1A for non-cash consideration, state date on which valuation of consideration was released to ASX Market Announcements

6i Calculate the entity’s remaining issue capacity under rule 7.1 and rule 7.1A – complete Annexure 1 and release to ASX Market Announcements

N/A LR 7.1: 273,107,916 LR 7.1A: 17,210,277

7 +Issue dates

Note: The issue date may be prescribed by ASX (refer to the definition of issue date in rule 19.12). For example, the issue date for a pro rata entitlement issue must comply with the applicable timetable in Appendix 7A.

15 February 2018

Cross reference: item 33 of Appendix 3B.

• See chapter 19 for defined terms.

Appendix 3B Page 3

04/03/2013

Appendix 3B New issue announcement

8 Number and +class of all +securities quoted on ASX (_including_the +securities in section 2 if applicable) 9 Number and +class of all +securities not quoted on ASX (_including_the +securities in section 2 if applicable) 10 Dividend policy (in the case of a trust, distribution policy) on the increased capital (interests) Part 2 - Pro rata issue	Number	Number	+Class
	2,339,047,777 240,166,667 881,925,000		Fully Paid Ordinary Shares Options exercisable at $0.003 each on or before 1 December 2019 Options exercisable at $0.01 each on or before 31 May2020
	Number		+Class
	Nil
	Dividend policy not yet established

11 Is security holder approval required? 12 Is the issue renounceable or nonrenounceable? 13 Ratio in which the[+] securities will be offered 14 +Class of +securities to which the offer relates 15 +Record date to determine entitlements 16 Will holdings on different registers (or subregisters) be aggregated for calculating entitlements?

• See chapter 19 for defined terms.

Appendix 3B Page 4

04/03/2013

Appendix 3B New issue announcement

17	Policy for deciding entitlements
	in relation to fractions
18	Names of countries in which the
	entity has security holders who
	will not be sent new offer
	documents
	Note: Security holders must be told how their
	entitlements are to be dealt with.
	Cross reference: rule 7.7.
19	Closing date for receipt of
	acceptances or renunciations
20	Names of any underwriters
21	Amount of any underwriting fee
	or commission
22	Names of any brokers to the
	issue
23	Fee or commission payable to
	the broker to the issue
24	Amount of any handling fee
	payable to brokers who lodge
	acceptances or renunciations on
	behalf of security holders
25	If the issue is contingent on
	security holders’ approval, the
	date of the meeting
26	Date entitlement and acceptance
	form and offer documents will be
	sent to persons entitled
27	If the entity has issued options,
	and the terms entitle option
	holders to participate on
	exercise, the date on which
	notices will be sent to option
	holders
28	Date rights trading will begin (if
	applicable)
29	Date rights trading will end (if
	applicable)

• See chapter 19 for defined terms.

Appendix 3B Page 5

04/03/2013

Appendix 3B New issue announcement

30	How do security holders sell	How do security holders sell
	their entitlements_in full_	through
	a broker?
31	How do security holders	sell_part_
	of their entitlements through a
	broker and accept	for the
	balance?
32	How do security holders dispose
	of their entitlements (except by
	sale through a broker)?
33	+Issue date

• See chapter 19 for defined terms.

Appendix 3B Page 6

04/03/2013

Appendix 3B New issue announcement

Part 3 - Quotation of securities

You need only complete this section if you are applying for quotation of securities

• 34 Type of[+] securities ( tick one )

• (a) x +Securities described in Part 1

• (b) All other[+] securities

Example: restricted securities at the end of the escrowed period, partly paid securities that become fully paid, employee incentive share securities when restriction ends, securities issued on expiry or conversion of convertible securities

Entities that have ticked box 34(a)

Additional securities forming a new class of securities

Tick to indicate you are providing the information or documents

• 35 If the[+] securities are[+] equity securities, the names of the 20 largest holders of the additional[+] securities, and the number and percentage of additional[+] securities held by those holders

36 If the[+] securities are[+] equity securities, a distribution schedule of the additional

+securities setting out the number of holders in the categories

1 - 1,000

1,001 - 5,000

5,001 - 10,000 10,001 - 100,000 100,001 and over

37 A copy of any trust deed for the additional[+] securities

Entities that have ticked box 34(b)

• 38 Number of[+] securities for which +quotation is sought

• 39 +Class of +securities for which quotation is sought

• See chapter 19 for defined terms.

Appendix 3B Page 7

04/03/2013

Appendix 3B New issue announcement

• 40 Do the[+] securities rank equally in all respects from the[+] issue date with an existing[+] class of quoted +securities? If the additional[+] securities do not rank equally, please state:  the date from which they do  the extent to which they participate for the next dividend, (in the case of a trust, distribution) or interest payment

• the extent to which they do not rank equally, other than in relation to the next dividend, distribution or interest payment

41 Reason for request for quotation now Example: In the case of restricted securities, end of restriction period

(if issued upon conversion of another[+] security, clearly identify that other[+] security)

42 Number and +class of all +securities quoted on ASX ( including the[+] securities in clause 38)

Number +Class

• See chapter 19 for defined terms.

Appendix 3B Page 8

04/03/2013

Appendix 3B New issue announcement

Quotation agreement

• 1 +Quotation of our additional +securities is in ASX’s absolute discretion. ASX may quote the[+] securities on any conditions it decides.

• 2 We warrant the following to ASX.

• The issue of the[+] securities to be quoted complies with the law and is not for an illegal purpose.

• There is no reason why those[+] securities should not be granted +quotation.

• An offer of the[+] securities for sale within 12 months after their issue will not require disclosure under section 707(3) or section 1012C(6) of the Corporations Act.

Note: An entity may need to obtain appropriate warranties from subscribers for the securities in order to be able to give this warranty

• Section 724 or section 1016E of the Corporations Act does not apply to any applications received by us in relation to any[+] securities to be quoted and that no-one has any right to return any[+] securities to be quoted under sections 737, 738 or 1016F of the Corporations Act at the time that we request that the[+] securities be quoted.

• If we are a trust, we warrant that no person has the right to return the +securities to be quoted under section 1019B of the Corporations Act at the time that we request that the[+] securities be quoted.

• 3 We will indemnify ASX to the fullest extent permitted by law in respect of any claim, action or expense arising from or connected with any breach of the warranties in this agreement.

• 4 We give ASX the information and documents required by this form. If any information or document is not available now, we will give it to ASX before +quotation of the +securities begins. We acknowledge that ASX is relying on the information and documents. We warrant that they are (will be) true and complete.

Sign here: Date: 15 February 2018

Print name: Graham Baldisseri Company Secretary

== == == == ==

• See chapter 19 for defined terms.

Appendix 3B Page 9

04/03/2013

Appendix 3B New issue announcement

Appendix 3B - Annexure 1

Calculation of placement capacity under rule 7.1 and rule 7.1A for eligible entities

Introduced 01/08/12 Amended 04/03/13

Part 1

Rule 7.1 – Issues exceeding 15% of capital

Step 1: Calculate “A”, the base figure from which the placement capacity is calculated

• Insert number of fully paid[+] ordinary securities on issue 12 months before the 1,303,759,444 + issue date or date of agreement to issue Add the following: • Number of fully paid[+] ordinary securities 7,913,333

• issued in that 12 month period under an exception in rule 7.2

• • Number of fully paid[+] ordinary securities issued in that 12 month period with 529,500,000 shareholder approval

• • Number of partly paid[+] ordinary securities that became fully paid in that 12 month period

• Note: • Include only ordinary securities here - other classes of equity securities cannot be added

• • Include here (if applicable) the securities the subject of the Appendix 3B to which this form is annexed

• • It may be useful to set out issues of securities on different dates as separate line items

• Subtract the number of fully paid[+] ordinary securities cancelled during that 12 month Nil period “A” 1,841,172,777

• See chapter 19 for defined terms.

Appendix 3B Page 10

04/03/2013

Appendix 3B New issue announcement

==> picture [415 x 575] intentionally omitted <==

----- Start of picture text -----

Step 2: Calculate 15% of “A”
“B” 0.15
[Note: this value cannot be changed]
Multiply “A” by 0.15 276,175,916
Step 3: Calculate “C”, the amount of placement capacity under rule 7.1
that has already been used
Insert number of [+] equity securities issued
or agreed to be issued in that 12 month
period not counting those issued:
3,068,000
• Under an exception in rule 7.2
• Under rule 7.1A
• With security holder approval under rule
7.1 or rule 7.4
Note:
• This applies to equity securities, unless
specifically excluded - not just ordinary
securities
• Include here (if applicable) the securities
the subject of the Appendix 3B to which
this form is annexed
• It may be useful to set out issues of
securities on different dates as separate
line items
“C” 3,068,000
Step 4: Subtract “C” from [“A” x “B”] to calculate remaining
placement capacity under rule 7.1
“A” x 0.15
Note: number must be same as shown in 276,175,916
Step 2
Subtract “C”
Note: number must be same as shown in 3,068,000
Step 3
Total [“A” x 0.15] – “C” 273,107,916
[Note: this is the remaining placement
capacity under rule 7.1]
----- End of picture text -----

• See chapter 19 for defined terms.

Appendix 3B Page 11

04/03/2013

Appendix 3B New issue announcement

Part 2

Rule 7.1A – Additional placement capacity for eligible entities Step 1: Calculate “A”, the base figure from which the placement capacity is calculated

“A” 1,841,172,777 Note: number must be same as shown in Step 1 of Part 1 Step 2: Calculate 10% of “A” “D” 0.10 Note: this value cannot be changed Multiply “A” by 0.10 184,117,277

Step 3: Calculate “E”, the amount of placement capacity under rule 7.1A that has already been used

• Insert number of[+] equity securities issued or agreed to be issued in that 12 month 166,907,000

• period under rule 7.1A Notes: • This applies to equity securities - not just ordinary securities

• • Include here - if applicable - the securities the subject of the Appendix 3B to which this form is annexed

• Do not include equity securities issued under rule 7.1 (they must be dealt with in Part 1), or for which specific security holder approval has been obtained

• It may be useful to set out issues of securities on different dates as separate line items

“E” 166,907,000

• See chapter 19 for defined terms.

Appendix 3B Page 12

04/03/2013

Appendix 3B New issue announcement

Step 4: Subtract “E” from [“A” x “D”] to calculate remaining placement capacity under rule 7.1A
“A” x 0.10 Note: number must be same as shown in Step 2	184,117,277
Subtract“E” Note: number must be same as shown in Step 3	166,907,000
Total[“A” x 0.10] – “E”	17,210,277 Note: this is the remaining placement capacity under rule 7.1A

• See chapter 19 for defined terms.

Appendix 3B Page 13

04/03/2013