Ann: Notice of Meeting Received , page-6

Is it a matter of time before Gulf Mines Become insolvent ?

I am also a small shareholder in Gulf Mines Aust .
Since the listing of this Company approximately three years ago I have been closely monitoring and tracking the exploration and geological activities of this Company on a regular basis . In my capacity as a concerned shareholder
I would like to take this opportunity to point out some ongoing key concerns and investigate the current financial position of this Company . These are genuine concerns and the fact that the Australian Stock Exchange has issued two price queries against Gulf Mines within the last few months only serves to highlight the importance of such issues .



In 2007 Gulf Mines raised 5M through the issue of 20M units at 25c . I also recollect that there was a secondary raising which brings the equity raising up to 10M (consolidated ) . At this point in time the Company was well funded to carry out its exploration activities
and seek to investigate acquisition potential such as the Nowa Nowa Project . As a longstanding shareholder I am very concerned regarding the current financial position of the Company and how these dwindling reserves will impact
or affect the Companies progress into the future . At present time of writing Gulf shares continue to stagnate at .002c which is 1/10th of the issue price
and based upon the current line of operations and cash expendiature I am fearful about the prospect of this Company becoming insolvent within a reasonably
short period of time . That may or may not come to fruition but with less than 250K ( I think ? ) in operational revenue and Gulf mines incresing propensity to conduct share price placements at ever increasingly low levels one can only estimate the longevity of this Company along current lines of operations .

Naive and hopeful shareholders who believe that Gulf can return or exceeed previous price levels really need to do the calculations and crunch the numbers
before they start talking or dreaming about blue sky potential . At the current price of .002c it would require a 1000% gain to break even against issue price and with the future prospect of further dillution at historically low prices this may only contribute to lower prices in the future .

So with cash reserves at just under 250K ? and no current or future discernable income source I believe that Shareholders are well entitled to ask the question : Is Gulf able to achieve the original objectives in which The Company was set up for ? If in turn The Board is unble to achieve these objectives within a reasonble length of time what other options are available . This Company has been in operation for approximately three years and it would appear that Gulf doesnt have sufficient funding as evidenced by The ASX price query to continue along its current line of exploration . This is the second ASX response that has been issued to Gulf in approximately three months and taking into consideration administrative and operational costs and The MD ongoing considerable salary I genuinely wonder how long this course of operation can last before The Compny becomes inslovent and all issued shares and options are deemed worthless .

Gulfs response to The ASX query is as follows
The Company will continue to rely on its existing cash resources ( How Much ? )
and also upon future equity capital raisings at historically low levels to fund its current activities . This does not sound like a very well thought out and prudent continuation strategy . Additional equity raisings will only serve to further dilute the register and may also continue to stunt the already stagnant share price .

Gulf has been an absolute nightmare from my personal perspective although I firmly acknowledge that I made a conscious decision to invest in this specultive stock so I am fully responsible for my investment decisions and objectives . Several years ago I decided to take out a loan to facilitate the purchase of Gulf Shares and now I am locked into regular repayments of well over 1000.00 per month to fund my decision to purchase a poultry 200,000 units which are now worth a poultry 4000.00 at current market prices . My next question is in reference to The MD salary and whether it is commensurate with the Companies current financil position and measured against their ability and track record to achieve even a small scale mineral deposit .

Why are we paying The MD approximately 5K per week or 250K per annum and should his salary be linked with the performance of The Company . Most Shareholders would agree that A Directors salary should be measured against a range of comprehensive factors including mainitaining the financial stability of a Company and creating wealth through Acqusitions or joint ventures . The Director of Gulf has been Chair of The Company for approximately three years and within this time The Companies finances have fallen to a very low level and at this point in time it would appear that we are no closer to even a small scale economic resource despite an inordinate amount of time and some pretty extensive drilling campaigns to achieve this . One really has to wonder just what the hell is going on at Gulf and some recent posts have raised some very pertinent questions . I have lso heard suggestions that The MD has been drawing three independent salaries out of Gulf . One for his position as The Managing Director . A secondary salary for that of an Exploration Manager and the final Salary for a Geologist . I am not sure quite sure of the validity of these suggestions so I cant accuratly confirm or deny whether they are true but in light of the dwindling cash reserves and the very fragile position of Gulf it doesnt seem economically prudent nor in the interests of shareholders to be extracting such payments when we are apprently no closer to achieveing or delineating some type of resource , even a small scale operation that can bring some revenue into the Company .

Concerned Shareholder