MYECO GROUP LTD — Capital/Financing Update 2011

May 4, 2011

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TO: COMPANY ANNOUNCEMENTS OFFICE ASX LIMITED DATE: 5 MAY 2011

UNDERWRITTEN RENOUNCEABLE RIGHTS ISSUE

Cardia Bioplastics Limited (“Cardia” or “the Company”) (ASX: CNN) is pleased to announce a fully underwritten renounceable rights issue to raise approximately $4.5 million (“Rights Issue”). The Rights Issue is fully underwritten by Patersons Securities Limited (“Patersons”).

A Prospectus for the Rights Issue will be lodged with ASIC today and will be sent to shareholders shortly.

Chairman, Mr Pat Volpe said, “I am pleased to receive such strong demand in what is a challenging market, which pays testament to the significant progress made thus far and the exciting prospects of Cardia’s next phase of growth. I would like to thank Patersons as the underwriter for their support”.

The proceeds of the Rights Issue will be directed to the anticipated global growth of Cardia’s bioplastics portfolio. Further details of the use of the proceeds are provided below and in the Prospectus.

The Rights Issue will supersede the placement of up to 10 million ordinary fully paid shares at 1.5 cents per share announced by the Company on 18 February 2011.

Details of Rights Issue

Shareholders will be provided with an opportunity to participate in Cardia’s growth and development strategy through a renounceable rights issue of 1 new fully paid ordinary share (“New Share”) for every 2 shares held at 5pm on 19 May 2011 (“Record Date”) at an issue price of $0.01 (1 cent) each, together with 1 free-attaching option for every 4 new shares subscribed, having an exercise price of 1.5 cents and an expiry date of 30 June 2012 (“New Option”). For every New Option that is exercised, then the holder will receive in addition to one new ordinary share arising from that exercise, a further 1 free attaching option for each New Option, exercisable at 2 cents at any time before 30 June 2013 (“Piggy Back Option”) (“the Rights Issue Offer”).

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The maximum number of shares offered under the Rights Issue Offer is 447,274,855 (assuming no existing options are exercised prior to the Record Date). The maximum number of New Options offered under the Rights Issue Offer is 111,818,714.

Application seeking the quotation of New Shares and New Options will be lodged with ASX on completion of the issue.

Any Piggy Back Options issued upon exercise of the New Options or Underwriter Options will not be issued to holders of such Options until such time as the Company has prepared a disclosure document for the purposes of complying with the technical requirements of the Corporations Act in respect of the grant of those subsequent Piggy Back Options. Piggy Back Options will only be issued under a separate disclosure document. The Company is expecting to prepare and lodge such disclosure document in July 2012. Quotation of Piggy Back Options will be sought separately upon issue of that disclosure document.

Cardia has appointed Patersons as Lead Manager and Underwriter to the offer. Under the terms of the Underwriting agreement and as an incentive for sub-underwriters, the Company has agreed to issue up to further 111,818,714 options to the Underwriters for every 4 new shares underwritten (having the same terms as the New Options) (“Underwriter Options”) as part of its underwriting fee.

The Rights Issue is being offered to shareholders with a registered address in Australia and New Zealand only. The Company will appoint a nominee who will seek to sell the entitlements of New Shares which would otherwise be issued to shareholders outside of Australia and New Zealand. The nominee will remit any proceeds of the sale of the entitlements or New Shares (less costs) to be distributed to the ineligible shareholders.

Eligible shareholders, in addition to their entitlements, will also have the opportunity to apply for additional shares with free attaching options from any potential shortfall under the Rights Issue. The Company will be entitled to place any shortfall within a period of three months following closure of the Rights Issue.

Use of Proceeds from the Rights Issue

The net proceeds from the Rights Issue Offer will be used to fund the following:

• (a) current and new client development projects;

• (b) manufacturing and distribution activities of the Company;

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• (c) expansion of the sales and marketing team of the Company to develop new alternative packaging for major brand owners;

• (d) maintenance of the Company’s existing provisional patents portfolio, accreditations and application for new patents;

• (e) the purchase and implementation of a new integrated financial accounting system (ERP) that will allow management of financial and accounting systems and reporting required as the Company’s business expands globally;

• (f) the purchase of additional equipment to expand the resin and finished goods capability of the Company; and

• (g) for general working capital requirements.

Important Dates

EVENT	DATE
Announcement Of Offer & Appendix 3B	5 May2011
Offer document lodged with ASX	5 May 2011
Letter to Shareholders	6 May 2011
Existing Shares quoted on“ex”basis	13 May 2011
Rights Trading Starts	13 May 2011
Record date- the date for determining entitlements of eligible shareholders to participate in the offer.	19 May 2011
Prospectus and Entitlement& Acceptance Forms despatched to Eligible Shareholders	23 May 2011
Rights trading ends	31 May 2011
Final date and time for receipt of acceptance and payment in full (“Closing Date”)	7 June 2011
Rights issue short fall notified to ASX	9 June 2011
Securities quoted on a deferred settlement basis	13 June 2011
Despatch date (deferred settlement trading ends)	16 June 2011
Normal trading resumes	17 June 2011

These dates are subject to change and are indicative only. Cardia Bioplastics Limited reserves the right to amend this time table including, subject to the Corporations Act and listing rules, to extend the closing date. The Directors may extend the Closing date by giving at least 6 Business Days notice to ASX prior to the Closing Date. The date that the new shares are expected to commence trading on the ASX may vary with any change to the Closing date.

An Appendix 3B is attached .

Pat Volpe Chairman

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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 1/7/96. Origin: Appendix 5. Amended 1/7/98, 1/9/99, 1/7/2000, 30/9/2001, 11/3/2002, 1/1/2003, 24/10/2005.

Name of entity

Cardia Bioplastics Limited

ABN 89 064 755 237

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).

space).
1 +Class of +securities issued or to be issued 2 Number of+securities issued or to be issued (if known) or maximum number which may be issued	Ordinary shares & Options
	Up to 447,274,855 Ordinary Shares and 223,637,428 Options

• See chapter 19 for defined terms.

24/10/2005Appendix 3B Page 1

3 Principal terms of the +securities (eg, if options, exercise price and expiry date; if partly paid+securities, the amount outstanding and due dates for payment; if +convertible securities, the conversion price and dates for conversion) 4 Do the +securities rank equally in all respects from the date of allotment 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	Fully paid ordinary shares. Options to acquire ordinary shares with an expiry date of 30 June 2012 and exercise price of 1.5 cents.
	The ordinary shares will rank equally with current quoted ordinary shares from the date of allotment. The options are a proposed new class of options .Shares exercised on the options will be ordinary shares that will rank equally with the then current quoted ordinary shares from the date of issue.
	1 cent per share. NILper option

6 Purpose of the issue (If issued as consideration for the acquisition of assets, clearly identify those assets) 7 Dates of entering+securities into uncertificated holdings or despatch of certificates 8 Number and +class of all +securities quoted on ASX (including the securities in clause 2 if applicable) 9 Number and +class of all +securities not quoted on ASX (including the securities in clause 2 if applicable)	Issued pursuant to a fully underwritten renounceable rights issue of:  1 new share for every 2 ordinary shares.  1 new option for every 4 New shares accepted  1 new option for every 4 New shares underwritten, being Underwriter options per the Underwriting Agreement. The purpose of rights issue is to supplement working capital for further growth and development of its bioplastics business.	Issued pursuant to a fully underwritten renounceable rights issue of:  1 new share for every 2 ordinary shares.  1 new option for every 4 New shares accepted  1 new option for every 4 New shares underwritten, being Underwriter options per the Underwriting Agreement. The purpose of rights issue is to supplement working capital for further growth and development of its bioplastics business.
	16th June 2011
	Number	+Class
	1,341,824,564 581,992,197 223,637,428	Ordinary Shares Options expiring 30th of June 2011 exercisable at 10 cents. Options expiring 30th June 2012 exercisable at 1.5 cents
	Number	+Class
	Nil

• See chapter 19 for defined terms.

24/10/2005Appendix 3B Page 3

10 Dividend policy (in the case The Board of Directors will consider of a trust, distribution establishing a dividend policy upon policy) on the increased achievement of profitable operations. capital (interests)

Part 2 - Bonus issue or pro rata issue

11 Is security holder approval required? 12 Is the issue renounceable or non-renounceable? 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? 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 issue documents Note: Security holders must be told how their entitlements are to be dealt with. Cross reference: rule 7.7.	No.
	Renounceable Rights Issue.
	One ordinary share for every two held.
	Fully Paid Ordinary Shares.
	19th May 2011
	N/A
	Rounded up
	The new issue documents will only be sent to shareholders with registered addresses in Australia and New Zealand.

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 prospectus or Product Disclosure Statement 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	7th June 2011
	Patersons Securities Limited (ABN 69 008 896 311) (Lead Manager and Underwriter)
	1. Underwriting fee of 6% of the underwritten amount of $4,472,749 2. Lead Manager fee of $60,000 3. Issue of 111,818,714 Options (on the terms described in 3 above
	N/A
	N/A
	N/A
	N/A
	23rd May 2011
	5th May 2011
	13th May 2011

• See chapter 19 for defined terms.

24/10/2005Appendix 3B Page 5

(if applicable)

29 Date rights trading will end (if applicable) 30 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 +Despatch date	31 May 2011
	Refer Prospectus
	Refer Prospectus
	Refer Prospectus
	16th June 2011

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)  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

• See chapter 19 for defined terms.

24/10/2005Appendix 3B Page 7

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
40	Do the +securities rank
	equally in all respects from
	the date of allotment 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)

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

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.

• See chapter 19 for defined terms.

24/10/2005Appendix 3B Page 9

• 4 We give ASX the information and documents required by this form. If any information or document not available now, 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 : 5[th] May 2011

Print name: REKHA BHAMBANI Company Secretary