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CORPORATE NEWS RELEASE

OTC BB:
Dateline: Vancouver, Canada
Date: 03 08 20
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FEC RESOURCES ANNOUNCES THE RESULTS OF ITS RIGHTS OFFERING, THE CONVERSION TO EQUITY OF THE RIGHTS OFFERING ADVANCE AND THE USE OF PROCEEDS OF THE RIGHTS OFFERING.
 

FEC RESOURCES INC. (PINK: FECOF) (“FEC” or the “Company”) announces today that it completed its previously announced Rights Offering on July 31, 2020, receiving gross proceeds of approximately US$846,750, and converted into equity the Rights Offering Advance of US$170,111 previously received from PXP Energy Inc. (“PXP”), details of which were announced by the Company on April 14, 2020. This has resulted in the Company issuing a total of 451,938,606 new shares. The related transaction costs of the Rights Offering are anticipated to be approximately US$90,000.


PXP has effectively exercised their rights in full, by subscribing directly to the Rights Offering in the amount of US$842,388.57 and converting to equity the Rights Offering Advance of $170,111.40 referred to above; thereby increasing their interest in the Company from 54.99% to 78.39% reducing the ability of minority shareholders to determine the outcome of shareholder votes and special resolutions which require 66 2/3% of votes cast to pass. Following the completion of the Rights Offering and the conversion to equity of the Rights Offering Advance the issued and outstanding shares of the Company have increased from 409,143,765 to 861,082,371.


USE OF FUNDS

Excluding the Rights Offering Advance, the net proceeds will be used for the following purposes:

1. The Company will be repaying in full a working capital loan of US$150,000 due to PXP

2. The Company has agreed to purchase 6.8% of the loan currently due by Forum Energy Ltd to PXP this will amount to US$346,202 plus accrued interest. This loan is unsecured, due on December 31, 2021 and bears interest at an annual rate of 3.5% plus LIBOR which is payable on a quarterly basis; and

3.The balance of net proceeds will be used for general working capital purposes.

On behalf of the Board of,

FEC Resources Inc.

Paul Wallace

Director


Forward-Looking Statements


FEC cautions that this release contains forward-looking statements, including, without limitation, statements relating to the use of funds and the anticipated transaction costs. These forward-looking statements are based on management’s current expectations and involve a number of risks and uncertainties, including, among other things; our ability to continue as a going concern; our ability to obtain and maintain sufficient financing to provide liquidity to meet our business objectives. If one or more of these risks or other risks materialize, actual results may vary materially from those expressed. For a more complete discussion of these and other risk factors, see FEC’s filings with the Securities and Exchange Commission, including our most recent annual report on Form 20-F and quarterly report on Form 6-K. FEC cautions not to place undue reliance on these forward-looking statements, which speak only as of the date of this release, and undertakes no obligation to update or revise any forward-looking statement, except to the extent required by applicable law.

On behalf of the Board of, FEC Resources Inc. Paul Wallace Director

For more information please e-mail info@FECResources.com or visit the FEC Resources website at www.FECResources.com

 
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