REACH RESOURCES LIMITED — Capital/Financing Update 2021

Jan 14, 2021

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ASX ANNOUNCEMENT/ MEDIA RELEASE

15[TH] January 2021

Non-Renounceable Rights Issue and Shortfall Offer

Cervantes Corporation Ltd (ASX: CVS, Cervantes or the Company) is pleased to announce it will undertake a non-renounceable entitlement issue of up to 268,004,155 Shares at an issue price of $0.008 per Share on the basis of one (1) Share for every two (2) Shares held at the Record Date, together with one (1) free unlisted new Option for every (2) new Shares issued exercisable at $0.015 on or before 28 February 2023 ( Offer ) to raise up to approximately $2.144 million before costs.

The Offer is open to all shareholders who have a registered address within Australia or New Zealand ( Eligible Shareholders ) and who hold Shares at 7pm (EDST) on Thursday 21 January 2021 ( Record Date ).

A shortfall offer is also being made for Shares and Options not subscribed under the Offer ( Shortfall Offer ), to which all Eligible Shareholders, and general investors in Australia, can subscribe.

The Offers are being undertaken to provide the Company with a minimum of $1.5 million in working capital with a view to the Company satisfying ASX Listing Rule 12.2 and the suspension of trading in its Shares being lifted by ASX. The funds raised will be used for further exploration and evaluation of the Primrose Gold Project (in particular advancing the Blue Heaven exploration target with the aim of declaring a JORC Mineral Resource, as well as further advancing the Pansy pit towards early development), reduction of current loan liabilities and working capital.

The Company has continued to spend on exploration over the last 18 months advancing the Primrose Gold Project, including announcing an Exploration Target for the Blue Heaven prospect (as released to ASX on 16 July 2020) , and more recently completing another drilling programme to further advance both the Pansy Pit and Blue Heaven prospects. This activity added significantly more value to the Company and, as a result, the Company has elected to raise fresh capital to further accelerate overall development of the project area.

The Company carried out similar activities to advance our Albury Heath project to the stage where it was sold (refer ASX release 23 April 2020) for a substantial return to shareholders, allowing the Company to focus on advancing the Primrose Gold Project to a stage of creating a potential JORC mineral resource in two locations within the project area.

The Company is very excited about the exploration potential of the Primrose Gold Project and the future for the Gold market.

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Timetable

The proposed indicative timetable for the Offers is set out below:

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----- Start of picture text ----- TIMETABLE DATE*Lodgement of Prospectus with the ASIC and ASX /Fri 15 January 2021Announce Offer and lodge Appendix 3B with ASXNotice sent to Shareholders Mon 18 January 2021“Ex” date Wed 20 January 2021Record Date for determining Entitlements Thu 21 January 2021Prospectus sent out to Eligible Shareholders, CompanyMon 25 January 2021announces this has been completedOffers Open Mon 25 January 2021Last day Company can extend Closing Date Tue 2 March 2021Closing Date of the Offer* Fri 5 March 2021Announcement of results of the Offer Wed 10 March 2021Shortfall Offer closes** Thu 11 March 2021Issue date of Securities issued under the Offer / Fri 12 March 2021Lodgement of Appendix 2A with ASX* (before 12pm EDST)Shares issued under the Offer commence trading on ASXMon 15 Mar 2021on a normal basis*----- End of picture text -----

* The dates above are indicative only and are subject to change. The Directors may vary these dates subject to any applicable requirements of the Corporations Act or the Listing Rules. The Directors may extend the Closing Date of the Offer by giving at least three (3) Business Days’ notice to ASX prior to the Closing Date or close the Offer early. As such the date the Securities are expected to commence trading on ASX may vary.

**The Directors may vary the closing date of the Shortfall Offer and the Cleansing Offer without notice.

This announcement has been authorised by the board of the Company for release.

-ENDS-

For further information please contact the Company:

P: +61 8 6436 2300

E: admin@cervantescorp.com.au

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