DREADNOUGHT RESOURCES LTD — Capital/Financing Update 2014

May 28, 2014

29 May 2014

Dear Shareholder

On 21 May 2014, Tychean Resources Ltd (Company) announced a non-renounceable rights issue to shareholders of 1 new share for every 3 existing shares held at an issue price of \$0.003 per new share together with 1 free new option for every 2 new shares subscribed for, exercisable at \$0.006 on or before 30 June 2015 (Rights Issue or Offer).

The Rights Issue seeks to raise up to \$1.5 million (approximately) before costs through the issue of up to 500 million (approximately) new fully paid ordinary shares in the Company.

Use of Funds

The net proceeds from the Rights Issue will be used for working capital purposes and to fund exploration and development including the following:

Spargoville Gold Project

• Core Farm Prospect Exploration and Resource Definition Aircore Drilling
• 5B Gold Mine Exploration and Resource Definition RC Drilling $\bullet$
• Golden Orb South Prospect RC Exploration Drilling $\bullet$
• Fugitive Prospect RC Exploration Drilling $\bullet$

Valley Floor Gold Project

• Valley Floor Prospect Aircore and RC Exploration Drilling
• Lefroy South Prospect Aircore and RC Exploration Drilling.

Details of the Rights Issue

Tychean shareholders with registered addresses in Australia or New Zealand at 7.00 pm (Adelaide time) on 3 June 2014 (Record Date) will be eligible to participate in the Rights Issue (Eligible Shareholders).

Tychean has decided that it is unreasonable to make the offer to shareholders who have a registered address in a country outside of Australia or New Zealand, having regard to the number of shareholders in such places, the number and value of the new shares and new options they would be offered and the substantial costs of complying with the legal and regulatory requirements in those jurisdictions.

Each Eligible Shareholder will be entitled to subscribe for 1 new share in the capital of the Company for every 3 shares registered in their name on the Record Date. The new shares will be issued at a cost of \$0.003 per share.

The Rights Issue price reflects a 25% discount to the closing price of the Company's shares on the ASX on Tuesday, 20 May 2014, the most recent trading day prior to the announcement of the Rights Issue.

Existing optionholders will need to exercise their options and be a registered holder of shares on the Record Date if they wish to receive an entitlement to participate in the Rights Issue.

The Directors reserve the right to place any shortfall within three months after the close of the Offer. Full details of the Rights Issue will be contained in the prospectus lodged with the Australian Securities and Investments Commission and ASX (Prospectus). The Prospectus together with the Entitlement and Acceptance Form will be mailed to all Eligible Shareholders on 6 June 2014. A copy of the Prospectus is available on the company website at www.tycheanresources.com.

Key Dates

Key dates which shareholders should note are as follows:

EVENT	DATE
Prospectus lodged with ASIC and ASX	28 May 2014
"Ex" date	30 May 2014
Record Date to identify Shareholders entitled to participate in the Offer	3 June 2014
Prospectus and Entitlement and Acceptance Forms dispatched to Shareholders	6 June 2014
Opening Date	6 June 2014
Last day to extend the Offer closing date	18 June 2014
Closing date for acceptance (5.00pm Adelaide time)	23 June 2014
Shares quoted on a deferred settlement basis	24 June 2014
Notification to ASX of under subscriptions	26 June 2014
Issue date for New Securities issued under the Offer. Deferred settlement trading ends	30 June 2014
Trading of New Securities on ASX commences	1 July 2014

These dates are indicative only and, subject to the Corporations Act 2001 and the ASX Listing Rules, may be varied as the Directors decide.

Applications for new ordinary shares under the Rights Issue may only be made by completing the Entitlement and Acceptance Form which accompanies the Prospectus.
Eligible Shareholders should read the Prospectus carefully. Before making a decision to participate in the Offer, you should seek independent advice from your professional advisor.

Yours sincerely

Robert Kennedy Chairman Tychean Resources Ltd