Mr. Anthony Dutton reports

ARCO RESOURCES PROVIDES ADDITIONAL CORPORATE AND FINANCING UPDATES

Arco Resources Corp. has provided the following additional corporate and financing updates to follow its Jan. 14, 2016, news release, including: (1) confirmation of the date and location for the annual general meeting of shareholders; (2) suspension of the company's current share option plan; and (3) amendments to the recently announced debt settlement financing.

Corporate updates

Annual general meeting of shareholders

The company reports that it has confirmed the date and location for its coming annual general meeting of shareholders. The AGM will be held on March 18, 2016, at 10 a.m. at the offices of the company at Suite 818, 700 West Georgia St., Vancouver, B.C., as reported on SEDAR, in a notice of meeting and record date filed Jan. 18, 2016. The company had previously indicated in a news release dated Jan. 14, 2016, that it was considering holding its AGM on March 11, 2016.

Suspension of share option plan

The company reports that by resolution of the board of directors it has suspended its share option plan, effective immediately. There are currently no incentive stock options issued under the plan, as all previously existing options have either expired or been cancelled pursuant to the termination of various consultant and management agreements or to voluntary cancellation agreements with existing optionholders. The company will neither issue nor grant incentive stock options to its management, directors, consultants or other qualified recipients until the current suspended option plan is authorized for reinstatement by the company and approved by its shareholders.

Financing update

Amendment to debt settlement terms

The company reports that it has amended the terms of its proposed debt settlement financing currently in process and will now issue units to various debtholders instead of issuing common shares as previously reported in the news release dated Jan. 14, 2016. The company now proposes and will apply to the TSX Venture Exchange for approval to issue up to five million units at a price of five cents per unit to settle current liabilities of up to $250,000 held by several creditors. Each unit issued will consist of one common share and one common share purchase warrant, with each warrant exercisable to purchase one additional common share of the company at a price of 7.5 cents for a period of 18 months from the date of issue. All securities issued pursuant to the debt settlement transactions will be subject to a hold period of four months plus one day from the date of issuance in accordance with applicable securities legislation and exchange policy.

There is no change to the terms of the unit private placement financing being conducted concurrently with the debt settlement financing.

We seek Safe Harbor.