EASTERN RESOURCES LIMITED — Share Issue/Capital Change 2008

Nov 4, 2008

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5 November 2008

ABN 70 126 678 037 Suite 3, Level 1, 80 Chandos Street St Leonards, NSW 2065 PO Box 956, Crows Nest, NSW 1585 Ph: 02 9906 7551 Fax: 02 9906 5233 www.easterniron.com.au

Dear Shareholder

BONUS ENTITLEMENTS ISSUE OF OPTIONS and CANCELLATION OF LOYALTY OPTIONS ISSUE

As referred to in Eastern Iron Limited’s (ASX Code: EFE) announcements dated 23 September 2008 and 30 October 2008, the Company has now obtained advice from ASX about the proposed loyalty option issue foreshadowed in its IPO Prospectus dated 11 March 2008.

ASX has advised that it would not support schemes which permit the issue of loyalty options and has suggested that an option issue is done on a pro rata basis.

Given this advice, and being mindful of the volatility in the Company’s share price, the Company has decided to proceed with a pro rata bonus issue of options on more generous terms than were proposed for the loyalty options.

The Company is therefore pleased to announce that it proposes to make a pro rata bonus issue of options on the basis of one option for every two shares held at the record date (that has yet to be set, but is expected to be early December 2008 and will be announced in due course). The options will be exercisable at 12 cents each with an expiry date of 19 December 2010. This options issue will result in the Company issuing up to a maximum of 23,000,000 options.

The Company is currently preparing a prospectus for the offer. The Company expects to finalise and lodge the prospectus with the Australian Securities and Investments Commission in early December 2008.

The Board regrets the uncertainty that existed while the proposed loyalty options issue was considered by ASX and trusts that shareholders will find the upcoming bonus issue more appealing.

Yours faithfully

EASTERN IRON LIMITED

Peter Buckley Managing Director