Matrix Composites & Engineering : Notice of Annual General Meeting/Proxy Form

4 McGrath Road, Henderson, Western Australia

This Notice of Annual General Meeting should be read in its entirety. If Shareholders are in doubt as to how they should vote, they should seek advice from their professional advisers prior to voting.

Should you wish to discuss the matters in this Notice of Annual General Meeting please do not hesitate to contact the Company Secretary on (+61 8) 9412 1200.

Notice of Annual General Meeting (setting out the proposed resolutions) 3

Explanatory Statement 6

Glossary 12

Proxy Form

The Annual General Meeting of the Shareholders to which this Notice of Meeting relates will be

held at 10.00 am (WST) on Wednesday, 2 November 2016 at:

The Garden Island Room, AMC Jakovich Centre, 4 McGrath Road, Henderson, Western Australia.

The business of the Annual General Meeting affects your shareholding and your vote is important.

To vote in person, attend the Annual General Meeting on the date and at the place set out above.

A body corporate which is a shareholder, or which has been appointed as a proxy, is entitled to appoint any person to act as its representative at the Annual General Meeting. The appointment of the representative must comply with the requirements in section 250D of the Corporations Act. The representative should bring to the Annual General Meeting evidence of his or her appointment as the body corporate's representative, including any authority under which the appointment is signed. Unless the appointment states otherwise, the representative may exercise on the body corporate's behalf all of the powers that the appointing body could exercise at a meeting or in voting on a resolution. Shareholders can download and fill out the 'Appointment of Corporate Representation' form from the website of the share registry of the Company - www.linkmarketservices.com.au (under 'Investor Services' then 'Forms').

To vote by proxy, please complete and sign the enclosed proxy form and return by:

1. post to the Company's share registry, Link Market Services Limited at Locked Bag A14, Sydney South NSW 1235 or deliver to Link Market Services Limited at 1A Homebush Bay Drive, Rhodes NSW 2138; or

2. facsimile to the Company's share registry, Link Market Services Limited on facsimile number (+612) 9287 0309; or

3. online by visiting www.investorcentre.linkmarketservices.com.au. You will be taken to have signed your Proxy Form if you lodge it in accordance with the instructions given on the website,

so that it is received not later than 10.00am (WST) on Monday, 31 October 2016.

Notice is given that the 2016 Annual General Meeting of Shareholders of Matrix Composites & Engineering Ltd will be held at 10.00 am (WST) on Wednesday, 2 November 2016 at the Garden Island Room, AMC Jakovich Centre, 4 McGrath Road, Henderson, Western Australia.

The Explanatory Statement to this Notice of Annual General Meeting provides additional information on matters to be considered at the Annual General Meeting. The Explanatory Statement and the proxy form are part of this Notice of Annual General Meeting.

The Directors have determined pursuant to Regulation 7.11.37 of the Corporations Regulations 2001 (Cth) that the persons eligible to vote at the Annual General Meeting are those who are registered Shareholders of the Company at 4.00pm (WST) on Monday, 31 October 2016.

Terms and abbreviations used in this Notice of Annual General Meeting and Explanatory Statement are defined in the Glossary.

1. ORDINARY BUSINESS
2. ANNUAL FINANCIAL REPORT

   To receive and consider the Financial Report of the Company for the year ended 30 June 2016, consisting of the Income Statements, Statement of Financial Position, Statements of Changes in Equity, Statements of Cash Flows, the Directors' Report, the Directors' Declaration and the Independent Auditor's Report.

3. RESOLUTION 1 - RE-ELECTION OF MR CRAIG DUNCAN AS A DIRECTOR

   To consider and, if thought fit, to pass the following resolution as an ordinary resolution:

   "That, Mr Craig Duncan, being a Director of the Company, retiring by rotation in accordance with article 19.3 of the Company's Constitution, and being eligible, is re- elected as a Director of the Company."

4. RESOLUTION 2 - GRANT OF SHARE APPRECIATION RIGHTS TO MANAGING DIRECTOR AND CHIEF EXECUTIVE OFFICER MR AARON BEGLEY

   To consider and, if thought fit, pass the following resolution as an ordinary resolution of the Company:

   "That, for the purposes of ASX Listing Rule 10.14 and for all other purposes, the grant to the Managing Director and Chief Executive Officer Aaron Begley of 1,133,333 Share Appreciation Rights under the Matrix Rights Plan, on the terms described in the Explanatory Statement which forms part of this Notice of Meeting, be approved."

   Voting exclusion:

   The Company will disregard any votes cast on Resolution 2 by any Director of the Company (except one who is ineligible to participate in the Matrix Rights Plan) and their associates.

   However, the Company need not disregard a vote cast on Resolution 2:

   • it is cast by a person as proxy for a person who is entitled to vote, in accordance with the directions on the proxy form; or

   • it is cast by the person chairing the meeting as proxy for a person who is entitled to vote, in accordance with a direction on the proxy form to vote as the proxy decides.

     In addition, a vote must not be cast on Resolution 2 by a member of the KMP, or a closely related party of a KMP, acting as proxy for a person entitled to vote, if their appointment does not specify the way the proxy is to vote on Resolution 2. This restriction on voting undirected proxies does not apply to the person chairing the meeting where the chair has been expressly authorised to exercise undirected proxies.

     The Chairman of the Meeting will vote any undirected proxies in favour of Resolution 2 in accordance with the Corporations Act and ASX Listing Rules.

5. RESOLUTION 3 - THE REMUNERATION REPORT FOR THE YEAR ENDED 30 JUNE 2016 IS ADOPTED

To consider and, if thought fit, to pass the following resolution as an advisory resolution:

"That the Remuneration Report, as set out in the Company's 2016 Annual Report, is adopted."

The vote on this resolution is advisory only and does not bind the Directors or the Company.