MYECO GROUP LTD — Capital/Financing Update 2012

Feb 15, 2012

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TO: COMPANY ANNOUNCEMENTS OFFICE ASX LIMITED

DATE: 16 February 2012

LETTER TO SHAREHOLDERS

The attached letter will be dispatched today to Cardia Shareholders’ advising them of Renounceable Rights Issue of Cardia as announced on 9[th] Feburary 2012.

Rekha Bhambhani Company Secretary

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16 February 2012

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Dear Shareholder,

Renounceable Rights Issue

Cardia Bioplastics Limited (“Cardia” or “the Company”) (ASX: CNN) is pleased to announce that it lodged a Prospectus with ASIC on 10[th] Feburary 2012 in respect of a pro-rata renounceable rights issue to raise approximately $2.35 million (“Rights Issue”). The Rights Issue is partially underwritten by Patersons Securities Limited (“Patersons”) up to $1.5million.

The proceeds of the Rights Issue will be used for working capital purposes in order to address the Company’s immediate sales opportunities along with funding the Company’s development projects as the bioplastics business gains sales momentum. Further details of the use of the proceeds are provided below and in the Prospectus.

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 4 shares held at 5pm on 23 February 2012 (“Record Date”) at an issue price of $0.007 (0.7 cents) each, together with 1 freeattaching option for every 1 New Shares subscribed for, having an exercise price of 1.5 cents and an expiry date of 30 June 2015 (“New Option”).

The maximum number of New Shares offered under the Rights Issue is 336,351,454 (assuming no existing options are exercised prior to the Record Date). The maximum number of New Options offered under the Rights Issue is 336,351,454. Fractional entitlements will be rounded down to the nearest whole share.

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

Cardia has appointed Patersons as Lead Manager and Underwriter to the Rights Issue. The Rights Issue is partially underwritten up to $1.5million.

The Rights Issue is being offered to shareholders with a registered address in Australia and New Zealand only. The Company has appointed Patersons to act as nominee to seek to sell the entitlements to New Shares which would otherwise have been 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 the ineligible shareholders.

Shareholders resident in Australia or New Zealand holding Shares on behalf of persons who are resident overseas are responsible for ensuring that taking up Entitlements under the Rights Issue does not breach any regulations in the relevant overseas jurisdiction.

Eligible shareholders who take up their entitlement in full and who still hold less than 300,000 shares will also have the opportunity to apply for additional New Shares with free attaching New Options to round up their shareholding to 300,000 shares, from any potential shortfall under the Rights Issue. In addition, eligible shareholders who take up their full entitlement will also have the opportunity to apply for additional New

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Shares with free attaching New 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.

The Prospectus for the Rights Issue will be dispatched in due course.

Use of Proceeds from the Rights Issue

The net proceeds from the Rights Issue Offer will be used to fund the Company for general working capital requirements allowing for the current minimum inventory levels of raw materials, finished goods ($1.5 million) commensurate to the current scale of the Company’s global operations and to allow the Company to maintain enough cash liquidity to continue with its operations.

The net proceeds from the Rights Issue Offer if fully subscribed will be approximately $2.11 million and combined with the current cash on hand will have sufficient cash to fund working capital through to the end of September 2012.

If the underwritten amount of $1.5 million is the minimum raised then the Company will have sufficient cash to fund the Company’s operations to the end of June 2012.

Important Dates

EVENT	DATE
Announcement Of Offer & Appendix 3B	9 Feburary 2012
Offer document lodged with ASX	10 Feburary 2012
Letter to Shareholders	16 Feburary 2012
Existing Shares quoted on“ex”basis	17 Feburary 2012
Rights Trading Starts	17 Feburary 2012
Record date- the date for determining entitlements of eligible shareholders to participateinthe offer.	23 February 2012
Prospectus and Entitlement & Acceptance Forms despatched to Eligible Shareholders	27 February 2012
Rights trading ends	5March 2012
Securities quoted on a deferred settlement basis	6 March 2012
Final date and time for receipt of acceptance and payment in full (“Closing Date”)	13 March 2012
Rights issue short fall notified to ASX	16 March 2012
Despatch date (deferred settlement trading ends)	21 March 2012
Normaltradingresumes	22 March 2012

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.

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Pat Volpe Chairman