DIRECTORS

Dr Denis Clarke BSc, BA, PhD, FAIMM (Non-Executive Chairman)

Denis Clarke has more than 30 years experience in exploration and mining operations. Over 15 years with Plutonic Resources (“Plutonic”), he contributed significantly at the General Manager level to its success as it developed from a small explorer in 1983 to one of Australia’s largest gold miners prior to its take-over in 1998 in a transaction which valued Plutonic at $1 billion. Dr. Clarke at various times managed the exploration, finance, administration and corporate divisions. He brings to the Board broad technical, financial, administrative and corporate experience and a wide range of industry contacts. Dr Clarke holds the following listed company directorships:

• Troy Resources NL
• Beaconsfield Gold NL 
• Anglo Australian Resources NL

Dr Chris Ringrose BSc, Phd, MBA, MAIMM, MAICD (Managing Director)

Chris Ringrose has been an exploration geologist based mainly in Western Australia since he completed his geology degrees in Scotland in 1982. His career has included experience with EZ, Chevron and Aztec and, prior to joining Cullen, Chris was Exploration Manager with Troy Resources NL. for nine years. Chris has also completed an MBA at Deakin University and brings to the Company significant management, exploration and project evaluation experience gained both in Australia and overseas.

Grahame Hamilton BSc, MSc, MAIG (Non-Executive Director)

Grahame Hamilton has extensive experience over 30 years in exploration, corporate and project management. He has wide ranging expertise in project evaluation. Between 1994 and 1996 he managed the Brocks Creek exploration, environmental impact statement, feasibility study, mine development and construction for Solomon Pacific Resources NL. Before Solomon, Grahame worked with Getty Oil Development Co.- minerals division as Queensland Manager. He is a director of AIM-listed Mariana Resources NL.

John Horsburgh BSc, MSc, FAIMM (Executive Director)

John Horsburgh, a graduate of the Royal School of Mines, has over 32 years industry experience including 11 years with Solomon Pacific Resources NL. Prior to this he gained extensive experience in Australia and overseas with Getty Oil Development Co., Billiton and RTZ Group. He is chairman of AIM-listed Mariana Resources NL.

Wayne John Kernaghan BBus, ACA, FAICD, ACIS (Non-Executive Director and Company Secretary)

Wayne Kernaghan is a member of the Institute of Chartered Accountants in Australia with a number of years experience in various areas of the mining industry. He is also a Fellow of the Australian Institute of Company Directors. Mr. Kernaghan currently holds the following listed company directorships:

• Gulf Resources Limited 
• Australian Motor Finance Group Limited

SHAREHOLDER INFORMATION

Capital Structure (as at 30 Oct. 2008)

Options (as at 30 June 2008)

The company had the following unissued shares in respect of options:

Substantial Shareholders

As at 30 June 2008, the Company has the following Substantial Shareholders:

Aquila Resources Limited Group         15.78%

AMCI Group                                         14.60%

Twenty Largest Shareholders

The names of the twenty holders of the fully paid shares at 30 Oct. 2008 are listed below:

  

Name	No. of Shares	% Held	Rank
Aquila Steel Pty Ltd	72,000,000	12.98	1
UBS Wealth Management Australia Nominees Pty Ltd	50,951,299	9.18	2
Rubicon Nominees Pty Ltd	50,822,698	9.16	3
Kitchsmith Pty Ltd	14,355,002	2.59	4
Innerleithen Pty Ltd	12,352,120	2.23	5
BT X Pty Ltd	8,500,000	1.53	6
Wythenshawe Pty Ltd	7,260,783	1.31	7
Chiatta Pty Ltd	6,260,000	1.13	8
Penoir Pty Ltd	5,690,123	1.03	9
Aquila Resources Ltd	4,846,000	0.87	10
Wythenshawe Pty Ltd	3,395,000	0.71	11
Dunslair Pty Ltd	3,243,000	0.58	12
Mr Neil Ronald Griffin	3,186,308	0.57	13
Lindglade Enterprises Pty Ltd	3,050,000	0.55	14
BT X Pty Ltd	2,800,000	0.50	15
Mr Charles Bass	2,500,000	0.45	16
National Nominees Limited	2,260,959	0.41	17
Mr Dennis Robert Wyllie	2,243,000	0.40	18
Mr Joe Paul Angelucci & Mrs Grita Angelucci	2,212,000	0.40	19
ATFT Pty Ltd	2,165,000	0.39	20
Total	260,633,292	46.97

Voting Rights

Every member present in person or by representative shall on a show of hands have one vote, and on a poll every member present in person or by representative, proxy or attorney shall in respect of each fully paid share held by him.

CORPORATE GOVERNANCE

ASX Core Principles of Corporate Governance and ASX Guidelines

Australian Stock Exchange Ltd (ASX) has published 10 core principles of corporate governance which it believes underlie good corporate governance together with guidelines to satisfy those core principles. Under ASX listing rules, listed companies are required to provide a statement in their annual reports outlining the extent to which they have followed these best practice guidelines. In the following table the ASX core principles and guidelines are listed in the left hand column, and the company's comment/response is listed in the right hand column.

ASX Principle 1: Lay Solid Foundations

Recognise and publish the respective roles and responsibilities of the board and management

ASX Recommendations

1.1 Formalise and disclose the functions reserved to the Board and those delegated to management

Comment/Response by Company

The Board is comprised of an Independent Non Executive Chairman, one Executive Director and three Non-Executive Directors. Management of the company is carried out by the Managing Director with little or no delegation to staff. The full board meets on a regular basis for both management and board meetings.

ASX Principle 2: Board Structure

Have a board of an effective composition, size and commitment to adequately discharge its responsibilities and duties

ASX Recommendations

2.1 A majority of Board members should be independent directors

Comment/Response by Company

Two of the five directors are independent according to the ASX definition of independence due to one director being executive and two being former executives. In view of the size of the company and the nature of its activities the Board considers that the current Board is a cost effective and practical method of directing and managing the company.

2.2 The chairperson should be an independent director

Comment/Response by Company

As stated above the chairman is an Independent Non - Executive Director.

2.3 The roles of chairperson and chief executive officer should not be exercised by the same individual

Comment/Response by Company

As stated above the company operates with an Independent Non – Executive Chairman and a separate Managing Director. The Managing Director fulfils the role of chief executive officer.

2.4 The Board should establish a nomination committee

Comment/Response by Company

In view of the size of the Company and the nature of its activities, the Board has considered that establishing formally constituted committees for audit, board nominations and remuneration would contribute little to its effective management. Accordingly the nomination of new Directors and the setting, or review, of remuneration levels of Directors and senior executives are reviewed by the Board as a whole and approved by the resolution of the Board (with abstentions from relevant Directors where there is a conflict of interest).

2.5 The information indicated in Guide to reporting on Principle 2 should be provided.

Comment/Response by Company

Not applicable

ASX Principle 3: Ethical and responsible decision-making

Actively promote ethical and responsible decision-making

ASX Recommendations

3.1 The Company should establish a code of conduct to guide the directors, the chief executive officer (or equivalent), the chief financial officer (or equivalent) and any other key executives as to the practices necessary to maintain confidence in the company's integrity, and the responsibility and accountability of individuals for reporting or investigation reports of unethical practices

Comment/Response by Company

In view of the size of the Company and the nature of its activities, the Board has considered that an informal code of conduct is appropriate to guide executives, management and employees in carrying out their duties and responsibilities.

3.2 Disclose the policy concerning trading in company securities by directors, officers and employees

Comment/Response by Company

The Company does not have a formal policy which sets out time restrictions on share dealings. The Company policy is that of the corporations Law and ASX Listing Rules which state that dealings are not permitted at any time whilst in the possession of price sensitive information not already available to the market.

3.3 Provide the information indicated in Guide to Reporting on Principles. 

Comment/Response by Company

Not applicable - see comments at 3.1 and 3.2.

ASX Principle 4: Financial reporting integrity

Have a structure in place to independently verify and safeguard the integrity of the company's financial reporting

ASX Recommendations

4.1 Require the chief executive officer (or equivalent) and the chief financial officer (or equivalent) to state in writing to the Board that the company's financial reports present a true and fair view, in all material respects, of the company's financial condition and operational results and are in accordance with relevant accounting standards.

Comment/Response by Company

Due to the size and nature of the company and its activities and the size and structure of the Board, the financial reports are dealt with in some detail at full board meetings where the Managing Director and company Secretary/Financial Controller would report first hand to the full board. The Board also to a certain extent relies on the auditors to ensure compliance with relevant accounting standards and gives full and complete co-operation to its auditors without absolving itself of its responsibility. The full board takes responsibility for the accounts

4.2 The Board should establish an audit committee.

Comment/Response by Company

In view of the size of the Company and the nature of its activities, the Board has considered that establishing formally constituted committees for audit, board nominations and remuneration would contribute little to its effective management. Accordingly audit matters are reviewed by the Board as a whole and approved by resolution of the Board (with abstentions from relevant Directors where there is a conflict of interest).

4.3 Structure the audit committee so that it consists of:

• Only non executive directors
• A majority of independent directors
• An independent chairperson who is not the chairperson of the Board
• At least three members

Comment/Response by Company

Not applicable - see comments at 4.2.

4.4 Create a formal operating charter for the audit committee.

Comment/Response by Company

Not applicable - see comments at 4.2.

4.5 Understand and provide the information indicated in the Guide to reporting on Principle 4. 

Comment/Response by Company

Not applicable - see comments at 4.2.

ASX Principle 5: Timely and balanced disclosure

Promote timely and balanced disclosure of all material matters concerning the company

ASX Recommendations

5.1 Establish written policies and procedures designed to ensure compliance with ASX Listing Rule disclosure requirements and to ensure accountability at a senior management level for that compliance

Comment/Response by Company

Due to its size and structure the Board is able to meet on a regular basis for both management and Board meetings to ensure compliance with ASX Listing Rule disclosure requirements. The full Board is accountable for ASX compliance.

5.2 Understand and provide the information indicated in the Guide to Reporting on Principle 5. 

Comment/Response by Company

Not applicable - see comments at 5.1.

ASX Principle 6: Shareholder rights

Respect the rights of shareholders and facilitate the effective exercise of those rights

ASX Recommendations

6.1 Design and disclose a communications strategy to promote effective communication with shareholders and encourage effective participation at general meetings.

Comment/Response by Company

Information is communicated to shareholders and the market through:

• The annual report which is distributed to all shareholders;
• Other periodic reports which are lodged with ASX and available for shareholder scrutiny;
• Other announcements made in accordance with ASX Listing Rules;
• Special purpose information memoranda issued to shareholders as appropriate; and
• The Annual general Meeting and other meetings called to obtain approval for board action as appropriate.

6.2 Request the external auditor to attend the annual general meeting and be available to answer shareholder questions about the audit and the preparation and content of the auditor's report.

Comment/Response by Company

It is company policy that the auditor attend the AGM and part of the agenda is the tabling of the accounts and inviting shareholders to ask the directors or the auditor any questions about the report including the audit report.

ASX Principle 7: Risk Management

Establish a sound system of risk oversight and management and internal control

ASX Recommendations

7.1 The Board or appropriate Board committee should establish policies on risk oversight and management.

Comment/Response by Company

In view of the size of the Company and the nature of its activities, the Board has considered that establishing formally constituted committees would contribute little to its effective management. Accordingly risk oversight and management issues and policies are reviewed by the Board as a whole and approved by resolution of the Board (with abstentions from relevant Directors where there is a conflict of interest).

7.2 The chief executive officer (or equivalent) and the chief financial officer (or equivalent) should state to the Board in writing that:

7.2.1 the statement given in accordance with best practice recommendation 4.1 (the integrity of financial statements) is founded on a sound system of risk management and internal compliance and control which implements the policies adopted by the Board.

7.2.2 the company's risk management and internal compliance and control system is operating efficiently and effectively in all material respects.

Comment/Response by Company

Due to the size and nature of the company and it's activities and the size and structure of the Board, risk management and internal compliance and controls are dealt with by the full Board at its regular management and Board meetings. The non executive directors meet face to face with senior staff individually on a regular basis to satisfy themselves directly that risk management and internal compliance is being attended to. As above.

7.3 Information indicated in the Guide to Reporting on Principle 7 should be understood and provided in all material respects.

Comment/Response by Company

Not applicable for reasons stated above.

ASX Principle 8: Enhanced Performance

Fairly review and actively encourage enhanced Board and management effectiveness

ASX Recommendations

8.1 Disclose the process for performance evaluation of the Board, its committees and individual directors, and key executives.

Comment/Response by Company

Due to the size and structure of the Board a formal evaluation process is not conducted. The Company operates with only one full time employee and that person operations in an administrative capacity in addition to the three executive directors.

ASX Principle 9: Remunerate fairly

Ensure that the level and composition of remuneration is sufficient and reasonable and its relationship to corporate and individual performance is defined

ASX Recommendations

9.1 Provide disclosure in relation to the company's remuneration policies to enable investors to understand (i) the costs and benefits of these policies and (ii) the link between remuneration paid to directors and key executives and corporate performance.

Comment/Response by Company

The company does not have a remuneration policy other than to ensure that directors, staff and consultants are paid market rates in accordance with their qualifications, experience and contribution to the company. Directors' remuneration for both executive and non executive directors is compared to other 'junior explorers' as a guide to industry rates. There are no schemes of retirement benefits.

9.2 The Board should establish a remuneration committee.

Comment/Response by Company

In view of the size of the company and the nature of its activities, the Board has considered that establishing formally constituted committees for audit, board nominations and remuneration would contribute little to its effective management. Accordingly remuneration matters are reviewed by the Board as a whole and approved by resolution of the Board (with abstentions from relevant Directors where there is a conflict of interest).

9.3 The structure of non executive directors' remuneration should be clearly distinguished from that of executives.

Comment/Response by Company

The executive director is paid by salary and is governed by a formal contract. Directors' fees are paid separately to all non executive directors. The different types of remuneration including fringe benefits, superannuation, consulting fees and directors' fees are all clearly outlined in the Annual Report.

9.4 Ensure equity-based executive remuneration is made in accordance with thresholds set in plans approved by shareholders.

Comment/Response by Company

No directors, executives or staff has any equity based remuneration other than options. In the past options have been issued to directors and these were approved at a shareholders meeting with a formal notice and explanatory memorandum where full details were disclosed to all shareholders for their approval and included in the annual report.

9.5 Ensure information indicated in ASX Guide to Reporting on Principle 9 is understood and provided. 

Comment/Response by Company

See comments above.

ASX Principle 10: Interest of Shareholders

Recognise the legal and other obligations of all legitimate stakeholders

ASX Recommendations

10.1 Establish and disclose a code of conduct to guide compliance with legal and other obligations to legitimate stakeholders.

Comment/Response by Company

In view of the size of the Company and the nature of its activities, the Board has considered that an informal code of conduct is appropriate to guide executives, management and employees in carrying out their duties and responsibilities.