S2 RESOURCES LTD — Capital/Financing Update 2017

Oct 17, 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, 04/03/13

Name of entity

S2 Resources Limited ( S2R )

ABN

18 606 128 090

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 be issued 2 Number of+securities issued or to be issued (if known) or maximum number which may be issued 3 Principal terms of the+securities (e.g. 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)	Unlisted Options
	7,750,000
	As disclosed in the 2017 Notice of AGM Unlisted options with exercise price of $0.23 and an expiry of 17/10/2021 -

4 Do the[+] securities rank equally On exercise of the unlisted options, the in all respects from the[+] issue securities will rank equally with the fully date with an existing[+] class of paid ordinary shares 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 NIL 6 Purpose of the issue Unlisted options issued under Directors (If issued as consideration for Option plan the acquisition of assets, clearly identify those assets) 6a Is the entity an[+] eligible entity Yes. 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 17 October 2017 resolution under rule 7.1A was passed 6c Number of[+] securities issued Nil without security holder approval under rule 7.1 6d Number of[+] securities issued Nil. with security holder approval under rule 7.1A

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6e Number of+securities issued with security holder approval under rule 7.3, or another specific security holder approval (specify date of meeting) 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 +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. Cross reference: item 33 of Appendix 3B.	Nil
	Nil
	Not applicable.
	Not applicable.
	See Annexure 1
	17 October 2017

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)	Number	+Class
	246,052,452	Fully paid ordinary shares
	Number	+Class
	28,450,000 50,000 400,000 400,000 600,000 9,450,000 1,000,000 7,750,000	Options with an exercise price of $0.31 and an expiry of 14/09/2019 Options with an exercise price of $0.31 and an expiry of 9/10/2019 Options with an exercise price of $0.31 and an expiry of 23/10/2019 Options with an exercise price of $0.31 and an expiry of 28/11/2019 Options with an exercise price of $0.31 and an expiry of 17/04/2020 Options with an exercise price of $0.31 and an expiry of 17/04/2020 Options with an exercise price of $0.35 and an expiry of 28/04/2020 Options with an exercise price of $0.23 and an expiry of 17/10/2021
	Not applicable.

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Part 2 - Pro rata issue Not applicable

Part 3 - Quotation of securities Not applicable

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)

• 38 Number of[+] securities for which Not applicable. +quotation is sought

• 39 +Class of +securities for which Not applicable. quotation is sought

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)	Not applicable.
	Not applicable.
	Number	+Class
	Not applicable.	Not applicable.

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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.

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Sign here: ............................................................ (Company secretary)

Date: 18 October 2017

Print name: Tony Walsh

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 placement capacity is calculated

Insert number of fully paid ordinary 246,002,452 securities on issue 12 months before date of issue or agreement to issue

Add the following:

• Number of fully paid ordinary securities 50,000 issued in that 12 month period under an exception in rule 7.2

• Number of fully paid ordinary securities Nil issued in that 12 month period with shareholder approval

• Number of partly paid ordinary securities Nil 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 Nil securities cancelled during that 12 month period “A” 246,052,451

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Step 2: Calculate 15% of “A”

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“B” 0.15
[Note: this value cannot be changed]
Multiply “A” by 0.15 36,907,867
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 Nil
agreed to be issued in that 12 month period
not counting those issued:
• Under an exception in rule 7.2
• Under rule 7.1A
• With security holder approval under rule
7.1 or rule 7.4
“C” Nil
Step 4: Subtract “C” from [“A” x “B”] to calculate remaining
placement capacity under rule 7.1
“A” x 0.15 36,907,867
Note: number must be same as shown in
Step 2
Subtract “C” Nil
Note: number must be same as shown in
Step 3
Total [“A” x 0.15] – “C” 36,907,867
[Note: this is the remaining placement
capacity under rule 7.1]
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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

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“A” 246,052,451
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 24,605,245
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 Nil
agreed to be issued in that 12 month period
under rule 7.1A
“E”
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Step 4: Subtract “E” from [“A” x “D”] to calculate remaining placement capacity under rule 7.1A

Step 4: Subtract “E” from [“A” x “D”] to calculate remaining placement capacity under rule 7.1A	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	24,605,245
Subtract“E” Note: number must be same as shown in Step 3	Nil
Total[“A” x 0.10] – “E”	24,605,245 Note: this is the remaining placement capacity under rule 7.1A

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