EARLY WARNING REPORT FILED PURSUANT TO

PART 3 OF NATIONAL INSTRUMENT 62-103

1. The name and address of the offeror:

Dale Wallster (the “Offeror”)

4104 St. Albans Avenue

North Vancouver, BC, V7N 1T1

2. The designation and number or principal amount of securities and the offeror's

securityholding percentage in the class of securities of which the offeror acquired

ownership or control in the transaction giving rise to the obligation to file the

news release, and whether it was ownership or control that was acquired in those

circumstances:

The Offeror, through a corporation controlled by him, acquired ownership and control

of an additional 1,500,000 common shares of Shoreham Resources Ltd. ("Shoreham”)

pursuant to an exercise of 1,500,000 warrants at an exercise price of $0.60 per share.

The warrants were previously issued in connection with a private placement.

3. The designation and number or principal amount of securities and the offeror's

securityholding percentage in the class of securities immediately after the

transaction or occurrence giving rise to the obligation to file the news release:

Immediately after the share acquisition stated herein, the Offeror, directly and

indirectly, exercised ownership and control over 9,200,000 common shares of

Shoreham representing approximately 12.87% of the issued and outstanding common

shares of Shoreham.

4. The designation and number or principal amount of securities and the

percentage of outstanding securities of the class of securities referred to in

paragraph 3, above, over which:

(a) the Offeror, either alone or together with any joint actors, has ownership

and control

See (3) above. The Offeror is not acting together with any joint actors.

(b) the Offeror, either alone or together with any joint actors, has ownership

but control is held by other persons or companies other than the Offeror

or any joint actor

Not applicable

(c) the Offeror, either alone or together with any joint actors, has exclusive or

shared control but does not have ownership

Not applicable.

5. The name of the market where the transaction or occurrence took place:

The Offeror acquired ownership and control of the 1,500,000 common shares of

Shoreham pursuant to an exercise of 1,500,000 warrants which warrants were

previously issued pursuant to a private placement.

6. The value, in Canadian dollars, of any consideration offered per security if the

offeror acquired ownership of a security in the transaction or occurrence giving

rise to the obligation to file a news release:

The Offeror paid consideration of $0.60 per common share of Shoreham, for

aggregate consideration of $900,000.

7. The purpose of the offeror and joint actors in effecting the transaction or

occurrence that gave rise to the news release, including any future intention to

acquire ownership of, or control over, additional securities of the reporting

issuer:

The Offeror's acquisition was made for investment purposes. The Offeror may, in the

future, acquire ownership and control over additional securities of Shoreham for

investment purposes.

8. The general nature and the material terms of any agreement, other than lending

agreements, with respect to securities of the reporting issuer entered into by the

offeror, or any joint actor, and the issuer of the securities or any other entity in

connection with the transaction or occurrence giving rise to the news release,

including agreements with respect to the acquisition, holding, disposition or

voting of any of the securities:

Not applicable.

9. The names of any joint actors in connection with the disclosure required by this

Form:

Not applicable.

10. In the case of a transaction or occurrence that did not take place on a stock

exchange or other market that represents a published market for the securities,

including an issuance from treasury, the nature and value of the consideration

paid by the offeror:

The Offeror paid cash consideration of $0.60 per share pursuant to an exercise of

1,500,000 warrants.

11. If applicable, a description of any change in any material fact set out in a report

by the Offeror under the early warning requirements or Part 4 of National

Instrument 62-103:

Not applicable.

12. If applicable, a description of the exemption from securities legislation being

relied on by the Offeror and the facts supporting the reliance:

Not applicable.

DATED this the 18th day of May, 2010.

Signed "Dale Wallster"

DALE WALLSTER