MCS SERVICES LIMITED — Capital/Financing Update 2013

May 8, 2013

13 May 2013

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Dear Shareholder

Red Gum Resources Limited - pro-rata renounceable rights issue

As announced on 6 May 2013, Red Gum Resources Limited (ACN (119 641 986)) ( Company ) is undertaking a 1 for 2 pro rata renounceable rights issue ( Rights Issue or Offer ) of approximately 37,489,364 fully paid ordinary shares ( New Share ) at an issue price of $0.03 cents per Share ( Issue Price ), to raise up to approximately $1.125 million. The Offer will include one free attaching unquoted short dated option exercisable at 7 cents and expiring on 15 November 2013 for every two New Shares issued and one free attaching quoted long dated option exercisable at 10 cents and expiring on 1 March 2016 for every two New Shares issued.

The Company lodged a prospectus for the Offer ( Prospectus ) with ASIC and ASX on 9 May 2013.

The Offer is fully underwritten by DJ Carmichael Pty Ltd ( Underwriter ). The Company must pay the Underwriter a management and underwriting fee of 5.5% of the total amount raised pursuant to the Offer. In addition, the Company must pay the Underwriter a corporate advisory fee of $60,000 for its services in managing the issue and reimburse the Underwriter for costs incidental to the Offer. The Company has also agreed to issue 5,000,000 Options to the Underwriter as the broker. As part of the Offer, the Company will be required to issue up to 37,489,364 Options to sub-underwriters engaged by the Underwriter.

The funds raised will be used primarily towards funding the Company’s exploration program, including geophysical surveys and an initial round of drilling in the Majada Project area located in Region IV of Chile.

The Offer is being made to all shareholders of the Company ( Shareholders ) named on its register of members at 7:00pm (AEDT) on 20 May 2013, whose registered address is in Australia or New Zealand.

New Shares will rank equally with all fully paid ordinary shares in the capital of the Company ( Shares ) already on issue.

Following completion of the Offer, the Company will have issued approximately 37,489,364 New Shares resulting in total Shares on issue of approximately 112,468,091.

Ineligible shareholders

A Shareholder who has a registered address outside Australia and New Zealand ( Ineligible Shareholder ) will not be eligible to participate in the Offer.

You are not eligible to participate in the Offer and you will not be sent a copy of the Prospectus. This decision has been made pursuant to Listing Rule 7.7.1(a) of the ASX Listing Rules after taking into consideration the costs of complying with legal and regulatory requirements in jurisdictions outside of Australia and New Zealand compared with the small

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number of Ineligible Shareholders and the number and value of New Shares to which they would otherwise be entitled.

The Company has appointed DJ Carmichael Pty Ltd ( Nominee ) as nominee to sell the rights to subscribe for New Shares pursuant to the Prospectus ( Entitlements ) to which Ineligible Shareholders are entitled. The Nominee will have the absolute and sole discretion to determine the timing and price at which the Entitlements may be sold and the manner of any such sale.

Any interest earned on the proceeds of the sale of these Entitlements will firstly be applied against expenses of such sale, including brokerage, and any balance will accrue to Ineligible Shareholders.

The net proceeds of the sale of these Entitlements will then be forwarded by the Company as soon as practicable to the Ineligible Shareholders, in proportion to their share of such Entitlements (after deducting brokerage commission and other expenses). If any such net proceeds of sale are less than the reasonable costs that would be incurred by the Company for distributing those proceeds, such proceeds may be retained by the Company.

Notwithstanding that the Nominee may sell Entitlements, Ineligible Shareholders may nevertheless receive no net proceeds if the costs of the sale are greater than the sale proceeds.

There is no guarantee that the Nominee will be able to sell Entitlements of Ineligible Shareholders on ASX and Ineligible Shareholders may receive no value for the Entitlements. Both the Company and the Nominee take no responsibility for the outcome of the sale of such Entitlements or the failure to sell such Entitlements.

If you have any queries concerning the Rights Issue, please contact your financial adviser or Malcolm Lucas-Smith, Red Gum Resource Limited’s Company Secretary, on +61 0418 366 532.

Yours sincerely

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Malcolm Lucas-Smith Company Secretary

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