PYC THERAPEUTICS LIMITED — Capital/Financing Update 2017

Mar 9, 2017

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

Name of entity

PHYLOGICA LIMITED

ABN

48 098 391 961

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	+Classof +securitiesissued or tobe issued	a) ORDINARY SHARESb) ORDINARY SHARESc) UNLISTED OPTIONS
2	Number of +securitiesissued ortobeissued(ifknown)ormaximumnumberwhichmaybe issued	a) 900,000b) 15,000,000 (CANCELLED)c) 10,000,000 (CANCELLED)
3	Principaltermsofthe+securities(eg,ifoptions,exercise price and expiry date; if+securities,partlypaidtheamountoutstandingandduedatesforpayment;if+convertiblesecurities,theconversion price and dates forconversion)	a) FULLY PAIDb) LOAN FUNDED SHARESc) PYCAJ UNLISTED OPTIONSEXERCISABLE AT $0.025 ON ORBEFORE 23/09/2017

+ See chapter 19 for defined terms.

4	Do the +securitiesrank equallyin all respects from the date of	a) YES
	allotmentwithanexisting	b) NOT APPLICABLEc) NOT APPLICABLE
	+classof quoted +securities?
	If the additional securities do
	not rank equally, please state:
	the date from which they dotheextenttowhichthey
	participateforthenext
	dividend, (in the case of a
	trust,distribution)or
	interest payment
	the extent to which they donot rank equally, other than
	inrelationtothenext
	dividend,distributionor
	interest payment
5	Issue price or consideration	a) $0.025 PER SHARE
		b) NOT APPLICABLE
		c) NOT APPLICABLE
6	Purpose of the issue	a) ISSUED ON THE EXERCISE OF
	(If issued as consideration for	UNLISTED OPTIONS PYCAJ
	the acquisition of assets, clearly
	identify those assets)
6a	Is the entity an +eligibleentity	YES
	thathasobtainedsecurity
	holderapprovalunderrule7.1A?
	If Yes, complete sections 6b –
	6h in relation to the +securities
	the subject of this Appendix 3B,and comply with section 6i
6b	Thedatethesecurityholder	25 NOVEMBER 2016
	resolution under rule 7.1A waspassed
6c	+securitiesNumberofissuedwithoutsecurityholder	NIL
	approval under rule 7.1
6d	+securitiesNumberofissuedwithsecurityholderapproval	NIL
	under rule 7.1A
6e	+securitiesNumberofissued	NIL
	withsecurityholderapproval
	underrule7.3,oranother
	specificsecurityholder
	approval(specifydateof
	meeting)

+ See chapter 19 for defined terms.

• 6f Number of securities issued under an exception in rule 7.2
• 6g If securities issued under rule 7.1A, was issue price at least 75% of 15 day VWAP as calculated under rule 7.1A.3? Include the issue date and both values. Include the source of the VWAP calculation.
• 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
• 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 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)

900,000 ORDINARY SHARES EXCEPTION 4

N/A

N/A

7.1 REMAINING 15%: 298,505,810 7.1A REMAINING 10%: 199,003,873

a) 8 MARCH 2017 b) CANCELLATION ON 9 MARCH 2017 c) CANCELLATION ON 9 MARCH 2017

		Number	+Class
8	+classNumberandofall+securitiesquotedonASX(includingthesecuritiesinsection 2 if applicable)	1,990,037,734	Ordinary Shares
		Number	+Class
9	+classNumberandofall+securitiesnot quoted on ASX(includingthesecuritiesinsection 2 if applicable)	22,693,75010,000,00020,000,000	PYCAJ Options23/09/17 $0.025PYCAA UnlistedOptions 30/11/19 $NilPYCAA UnlistedOptions30/06/18 $Nil

NOT APPLICABLE

Part 2 - Bonus issue or pro rata issue

11 Is security holder approval required?

	required?
12	Is the issue renounceable or non‐renounceable?

+ See chapter 19 for defined terms.

Appendix 3B New issue announcement

+securities13Ratioinwhichthewill be offered+Class+securities14ofto which theoffer relates+Record15datetodetermineentitlements16Willholdingsondifferentregisters(orsubregisters)beaggregatedforcalculatingentitlements?17Policy for deciding entitlementsin relation to fractions18Names of countries in which the+securityentity hasholders whowillnotbesentnewissuedocumentsNote: Security holders must be told how theirentitlements are to be dealt with.Cross reference: rule 7.7.19Closingdateforreceiptofacceptances or renunciations20Names of any underwriters21Amount of any underwriting feeor commission22Namesofanybrokerstotheissue23Feeorcommissionpayabletothe broker to the issue24Amountofanyhandlingfeepayabletobrokerswholodgeacceptances or renunciations on+securitybehalf ofholders25Iftheissueiscontingenton+securityholders' approval, thedate of the meeting26Date entitlement and acceptanceform and prospectus or ProductDisclosure Statement will be sentto persons entitled27If the entity has issued options,andthetermsentitleoptionholderstoparticipateonexercise,thedateonwhichnoticeswillbesenttooptionholders

+ See chapter 19 for defined terms.

• 28 Date rights trading will begin (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)?

29	Date rights trading will end (ifapplicable)
30	+securityHowdoholdersselltheir entitlements in full througha broker?
31	+securityHowdoholderssellpartoftheirentitlementsthrough a broker and accept forthe balance?
32	+securityHowdoholdersdisposeoftheirentitlements(exceptbysalethroughabroker)?

33 +Despatch date

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

Entities that have ticked box 34(b)

+ See chapter 19 for defined terms.

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)

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

+ See chapter 19 for defined terms.

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 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: 10/03/2017

(Company secretary)

Print name: N FORDE

• See chapter 19 for defined terms.

Appendix 3B – Annexure 1

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

Introduced 01/08/12

Part 1

Rule 7.1 – Issues exceeding 15% of capital
Step 1: Calculate "A", the base figure from which the placementcapacity is calculated
Insert number of fully paid ordinarysecurities on issue 12 months before dateof issue or agreement to issue	2,004,138,734
Add the following:
•Number of fully paid ordinary securitiesissued in that 12 month period under anexception in rule 7.2	900,000 (OPTION EXERCISE 08/03/2017)
•Number of fully paid ordinary securitiesissued in that 12 month period withshareholder approval
•Number of partly paid ordinarysecurities that became fully paid in that12 month period
Note:•Include only ordinary securities here –other classes of equity securities cannotbe added•Include here (if applicable) thesecurities the subject of the Appendix3B to which this form is annexed•It may be useful to set out issues ofsecurities on different dates as separateline items
Subtract the number of fully paid ordinarysecurities cancelled during that 12 monthperiod	15,000,000 (LOAN FUNDED SHARES09/03/2017)
"A"	1,990,038,734

+ See chapter 19 for defined terms.

Step 2: Calculate 15% of "A"
"B"	0.15
	[Note: this value cannot be changed]
Multiply "A" by 0.15	298,505,810
Step 3: Calculate "C", the amount of placement capacity under rule7.1 that has already been used
Insert number of equity securities issued oragreed to be issued in that 12 month periodnot counting those issued:
•Under an exception in rule 7.2
•Under rule 7.1A
•With security holder approval under rule7.1 or rule 7.4
Note:•This applies to equity securities, unlessspecifically excluded – not just ordinarysecurities•Include here (if applicable ) thesecurities the subject of the Appendix3B to which this form is annexed•It may be useful to set out issues ofsecurities on different dates as separateline items
"C"	NIL
Step 4: Subtract "C" from ["A" x "B"] to calculate remainingplacement capacity under rule 7.1
"A" x 0.15	298,505,810
Note: number must be same as shown inStep 2
Subtract "C"	0
Note: number must be same as shown inStep 3
Total ["A" x 0.15] – "C"	298,505,810
	[Note: this is the remaining placementcapacity under rule 7.1]

+ See chapter 19 for defined terms.

Part 2

Rule 7.1A – Additional placement capacity for eligible entities
Step 1: Calculate "A", the base figure from which the placementcapacity is calculated
"A"	1,990,038,734
Note: number must be same as shown inStep 1 of Part 1
Step 2: Calculate 10% of "A"
"D"	0.10
	Note: this value cannot be changed
Multiply "A" by 0.10	199,003,873
Step 3: Calculate "E", the amount of placement capacity under rule7.1A that has already been used
Insert number of equity securities issued oragreed to be issued in that 12 month periodunder rule 7.1A
Notes:•This applies to equity securities – notjust ordinary securities•Include here – if applicable – thesecurities the subject of the Appendix3B to which this form is annexed•Do not include equity securities issuedunder rule 7.1 (they must be dealt within Part 1), or for which specific securityholder approval has been obtained•It may be useful to set out issues ofsecurities on different dates as separateline items
"E"	0

+ See chapter 19 for defined terms.

Step 4: Subtract "E" from ["A" x "D"] to calculate remainingplacement capacity under rule 7.1A
"A" x 0.10	199,003,873
Note: number must be same as shown inStep 2
Subtract "E"	0
Note: number must be same as shown inStep 3
Total ["A" x 0.10] – "E"	199,003,873
	Note: this is the remaining placementcapacity under rule 7.1A

+ See chapter 19 for defined terms.