*** Please note that I have tried my best to give a fair an accurate analagy of why this stock split is a bad idea: both in the summary below and in my letter after that to Larry and Frank and I consider both Larry and Frank as men of integrity and I beleive that other members of the Board are men of integrity as well. I also simply beleive they are making the wronge decision. My comments represnt only my analagy which makes them only my opinion of thought and personal feeling on the matter of a stock split and other analagies which I make: I ask shareholders to take the time and really look at this issue. In my view it is the most important issue we have ever faced.

Good Morning!

I ask fellow shareholders to consider carefully this proposed stock split: I will vote against it and I am hoping that others will convince Frank and Larry or other board members at the up coming conference call not to proceed.

Below is an “edited” e-mail to my friend Larry Hoover and Frank Candido who I also consider a friend: I outline SIX reasons as to why I ask for this proposed stock split to be rescinded.

I deleted some unnecessary passion expressed to Larry as a result of my deep disappointed in the proposed stock split and my comradship with him.

Here is a short summary of the SIX points in my e-mail to Larry and Frank:

Many of us own in the neighborhood of one million GNH shares:

After the 30 to 1 split, that 1,000.000 shares will be reduced to 33,333

Because of the new share price of 30 cents the number of shares are severely reduced.

This is only optics: it’s just an change in arithmetic…….

However there is a big change in our vulnerability as company and each individuals share holding: because at 30 cents we can fall thirty times more severely than at present as we trade at 1 cent.

In my e-mail to Larry and Frank I outline SIX ways in which the resulting vulnerability can cause the 30 cent share price after a stock split, to fall to 15 cents, then 10 cents, then 5 cents and obviously it can go down to 1 cent again.

I ask all shareholders: what do you prefer?

1,000,000 shares at 1 cent

Or

33,333 shares at 30 cents with the obvious vulnerability that the new share price of 30 cents can go to 5 cents or less.

(especial on a venture exchange where the average security is below 10 cents, these are the real optics)

(and especially in a weak market)

(and especially when new traders will be attracted after the split, when it is proposed that promotion will take place: these traders will take short term profits as usual and which can cause panic)

Please vote regardless of the number of shares you have: a million or 50,000: every bit of shareholder support may count.

Laslty: I was looking forward to getting together with Frank and Larry with other shareholders in Toronto but that fell through.

I cannot participate in the proposed conference call because it would be just too stressful for me considering what my family and I have been through: In place of my absence I have written out these concerns: Please feel free to have them answered. …if the answer is confusing then discount it. If the answer does not speak to the vulnerability which a 30 to 1 stock split creates please discount it.

Larry gave suggestion in his recent post of analyzing the company financial statements on SEDAR and this is a good idea for all shareholders, particularly if you are an accountant or analyst. (I am not)

This why I have asked for Larry and Frank to provide the approximate amount of money which is necessary for GNH to remain solvent with our claims in tact: This figure would include annual debt servicing of those claims and necessary professional fees (acconting ect.)

While it may be true this amount can be determined from financial information on SEDAR it would only be prudent to help shareholders with an approximate figure: Management is infinitely more equipped and capable of providing this assessment accurately.

(I also ask that the law fees be itemized separately which have to with the ongoing litigation. These would not be considered normal reoccurring debt servicing on our claims and other associated annual operating fees.)

I ask all shareholders to look at this minimum amount of money necessary to stay solvent with our claims because this is the amount of money we must fund going forward until the market returns or a respectable investor is recruited: one who does not require the optics of a stock split.

Please do not accept the answer that we cannot do a PP at only 1 cent. If this is true, there still remains many innovative ways to raise money and attract partners. They are out there especially because our market cap is only 1.4 million dollars, presently, this in the face of our resource estimate completed, showing half million oz. in the ground on less than 2% of our property:

Thank you for your time …danny

*** Please note that I have tried my best to give a fair an accurate analagy of why this stock split is a bad idea: both above and in my letter below to Larry and Frank and I consider both Larry and Frank as men of integrity and I have reason to beleive that other members of the Board are men of integrity as well. I simply beleive they are making the wronge decision. My commonts represnt only my analagy which makes them only my opinion of thought and personal feeling on the matter of a stock split and other analagies which were also made: I ask shareholders to take the time and really look at this issue. In my view it is the most important issue we have ever faced.

Hi Larry:

Sorry from the abrupt end of our conversation yesterday: I was entering the gym and was already late.

As suggested, I have sent this e-mail with the obvious reasons why a stock split for any junior is seen as suicidal by many, especially in a weak market. It’s a game of optics and those who play it make themselves vulnerable to traders. This eventually can bring the consolidated share price down to one digit numbers which causes a severe reduction in market cap, far less than what was ever possible if one just remains at their current share price. As well, remaining at 1 cent certainly represents a much better chance of appreciation going into the future. 1 cent to 5 cents brings the market cap from 1.4 million to 7 million. This is very difficult to achieve after a 1 to 30 stock split in which case you would require the .30 cents to rise to $1.50 share price for the same market cap.

I have sent a copy of this to Frank as suggested and I trust I can get a quick response, particularly as to my question of that amount of money we need to service our annual debt in order to remain solvent with our claims.

I never thought it possible that Frank or GNH as a whole would use the tactic of a stock split: This is more devastating to me than what my family and I have already suffered as a shareholders.

It seems your minds are made up to go ahead with this:

I would like to go on record at the very least and make the following SIX points:

It is hoped that after some reflection both you and Frank will work toward having this proposal retracted and failing that, vote against it with your own shares.

Before I start I would like to say I regard you Larry as a man of integrity and no matter what the outcome, I remain happy to have you as a friend. I do not know Frank as well, but he treated my daughter and I extremely well in Montreal and I have always appreciated his hard work as our CEO in the past.

ONE:

The split will set us up to fall again:

2 ways this can happen (among many):

A) The market is now poised to crash being at all time highs: when it does GNH will obviously follow and a panic fall from 30 cents after a 30 to 1 split would be fatal.

B) A disgruntled shareholder can play with the stock after it is set at 30 cents, trading and causing fear, which will also bring it down.

Your answer to this on the phone was: “that is not in GNH control”.

I agree, market sentiment or a disgruntled shareholder is not in GNH control: …BUT why make ourselves vulnerable to these factors? It’s more prudent to protect ourselves by not doing a stock split. …Particularly at the present time when markets are at all time highs and poised for a crash, not to mention the ongoing saga with the present disgruntled shareholder, E. T.

TWO:

The amount of money that may be necessary to spend on making sure the bid stays around 30 cents would be more wisely spent on simply servicing the annual debt service for our claims: There is no guarantee that the resulting share price of 30 cents (or where ever it ends up) will be kept there by the company or Frank or any of us: To even contemplate having to execute such an endeavor suggests loudly not to proceed with the split.

I predict that if this spilt is done the 30 cents will fall to somewhere below 10 cents within a 12 month period: and this could be just the time when Gold and the venture market could finally start to show strength: after all: it is overdue to happen!

Gold will eventually fly and the ventures market will eventually turn: until that time, our small market cap remains very outweighed by our deposit and property at large:

We can raise money with these fundamentals alone and NOT by playing games of optics with stock splits, which potentially leave us very vulnerable. We can raise at least enough money to service annual fees over the next few years, during which time the market will turn. We have waited this long, it does not make sense to throw in the towel and do a stock split.

We know there are shareholders such as myself who will participate in raising capital for the purpose of simply remaining solvent with our claims.

THREE:

Frank may be forced to resign as CEO, as unjust as that would be.

And those court proceedings alone are enough to send GNH spiraling downward from 30 cents.

I like Frank as a person and as CEO: He knows a great deal of our property and I want to see him remain: For him to leave for any reason will cause deterioration in the share price after the stock split.

To proceed with this split before the outcome of these court cases are confirmed is not fair to shareholders: Surely we will find a way to service our claims for the next year through these turbulent times of litigation.

FOUR:

You mentioned that there will be a push toward promotion and raising money for GNH after the split because it looks more attractive: (it should be said this is only optics and many would say a form of deception)

This ‘new beginning’ will bring in new traders. Yes, I said traders not ‘share holders’ in the investment sense.

I have seen how this works in the past: No matter if we are successful at raising money or not after a stock split, these new traders will decide to take short term profits and this will bring the stock spiraling downward because any selling causes panic, especially in a weak market.

History shows this: 10 to 1 stock splits in the past by juniors have seen their resulting consolidated price, usually around 10 cents, go back down to a few cents over a period of time. A 30 to 1 split simply makes us even more vulnerable, 30 times more vulnerable.

FIVE:

If we cannot attract investors with the real numbers as they are and a market cap of only $1.4 million, we will not be able to attract respectable investors just because the shares are split 1 to 30!

These prospective investors are not stupid! Our current market cap is very attractive and remains the same before and after a split.

When you go to these investors after a stock split, they can see that our share price has recently been split to appear at 30 cents, still with a market cap at 1.4 million: this will entice the prospective investor to wait until it’s at 15 cents, bringing the market cap down to $ 700,000 million: or 10 cents which would be a $466,666 market cap. Then it's a better deal for the new investor while long time shareholders are losing out dramatically.

As well, a prospective investor may choose to manipulate the stock price by any means, some of which may be illegal, involving direct trading or engaging others to be traders on their behalf and we may never know: this would bring the stock downward for their purposes of going back to the table to do a PP or partnership when we are at 15 cents, or 10 cents or less.

SIX:

Realizing value (increased market cap) through share price in future.

Today we are at 1 cent: (the bid) representing a market cap of 1.4 million. A tenfold increase would be 10 cents (market cap 14 million)

After 30 to 1 split leaving us at 30 cents, the same appreciation must see the share price go to 3 dollars !!!!

I ask: what scenario do you think is more plausible going forward during the next year or two?

A} bringing GNH to 10 cents through equitable and sound practice based on our property.

Or

B} bringing GNH to 3 dollars after a stock split.

Some shareholders would at least like to see an appreciation from the present 1 cent to 30 cents ….eventually. They, like myself are willing to stay invested. Please understand that if we want to realize this 30 cents after the proposed stock split, the share price must go to 9 dollars!!! This is ridiculous to expect of a Junior exploration company (although its only optics and arithmetic) because such appreciation (9 dollars per share) is asking too much for the venture exchange simply because the optics are out of wack…. Way out! This game of optics is a fleeting one and those who play it often suffer greatly in the end because of it.

I estimate fair value for GNH right now at a 140 million market cap, (1 dollar share price) based on what we have in the ground and our whole claim. We spent millions just to do a resource estimate which goes a long way to verify this. (our share price has already been to almost a dollar)

After a 30 to 1 split, the share price would have to go to $30.00 to represent this estimate of fair value.

I ask what is more likely going forward?

1 cent to 10 cents

10 cents to 20 cents

20 cents to 1 dollar.

Or

30 cents to 3.00 dollars

3.00 dollars to 9.00 dollars

9.00 dollars to 30.00

The answer is obvious if one considers the ventures exchange and it’s historical nature as an exchange for “penny stocks” in the unpredictable business of exploration.

I believe the governance under ventures authority should never allow the kind of activity involving stock splits: it only provides for more colorful optics, however fleeting: I regard it as a form of fantasy, some say deception and worse. To many it has the appearance of despair on the part of management and the board.

Stock splitting is done with large cap stocks for different reasons: eg. It allows a 500 dollar share price to be had at 50 dollars per share which might be more manageable when buying in lots of 50 or 100 shares. Having said this, stock splitting is unfortunately allowed and used on the ventures for different reasons.

Apparently, a ten to one stock split no longer requires shareholders approval. So if you do not get approval on a 30 to 1, it pains me greatly that you can go ahead and do a 10 to 1 without shareholders. I hope this would not be the case.

There certainly needs to be a shareholder with deeper pockets than I, who will challenge the OSC or whatever the applicable authority would be, on this matter in court. Perhaps it would go all the way to the supreme court: And should a shareholder be successful in a court of law, bringing down such practice, it would make for a much healthier ventures market. With such regulations currently, one does not have to wonder why the venture is so mistrusted and weak.

One last comment on deceptive optics caused by a stock split: Right after the split the share price may indeed go from 30 cents to 60 cents while you promote GNH. And there will be many who will celebrate, especially new comers, (TRADERS). They will purport: ‘Wow, a whole 30 cents upward!!’ …But long time shareholders like myself will know that this is only equivalent to our current share price going from 1 cent to 2 cents !!!!!!!!!

After it gets to that ‘lofty’ 60 cents (which represents 2 cents currently) then the new traders can take profits causing panic and it goes from 60 cents to 40, 30 and then 20, possibly in the same few days: we have all seen this play out before: Then, with in the year, it can fall in a weak market down to 5 cents. Most other juniors are below 10 cents so why not GNH. These are the optics. This is the game of optics we will be left with.

Remember the old proverb: “one who lives by the sword will die by it”, eventually.

Comparatively: one who plays with optics to raise capital deserves to lose money by the same means, and often does, eventually.

SUMARY

.

Free Insurance:

We are at the bottom now and it cannot get much worse unless we do a stock split and watch it come down more than it ever could otherwise.

This plausible fall after a stock split is impossible if we continue as we are!

Now we are: bid at 1 cent and ask at 1.5. ...it cannot get much worse. …but after a stock split it can get 6 to 20 to 30 times worse!!!

It's a dream to believe that GNH will simply remain at the share price as intended: 30 cents approximately: This is to have blind faith in the unknown: We set ourselves up to fall and be vulnerable to many unknown factors going forward: After a stock split, our present market cap of 1.4 million can be reduced to 100,000.00, as the stock price falls below 5 cents. At that point anyone can take GNH over. A fall from 30 cents to 5 cents after a split is very plausible over a one year period as has been seen in the past with other juniors playing this game of optics.

With a present share price of .01 cent: a fall to five cents after a split from 30 cents would be equivalent to a present share price of .0016 cents, which is six time less in value, leaving the market cap at approximately $233,333. down from the present 1,4000,000.00 million.

To remain where we are at a bid of 1 cent offers the best insurance in the world and it’s FREE.

GOING BANCRUPT

We talked about the concern of paying annual debt service on claims for many Juniors, as bankruptcy looms if these fundamentals are not achieved.

Could you tell me the bare bone annual cost to keep our claims alive:

This amount would include the annual claim fees together with the minimum operating costs per year. (accounting and corporate law fees)

This is what we should be looking at and finding innovative ways to fund, based on our grossly undervalued market cap. Investors are out there for this purpose for sure: 2 million market cap represents a great deal for them to come on board. Optics and stock splitting mean nothing to the right investor, at least those with integrity. Do we really want to attract investors based on optics? If we do, then we deserve the inevitable outcome which has played out so horribly in the past for other juniors who have tried it.

Perhaps there is concern about raising money for the law suits that unfortunately have transpired. Perhaps this stock split has been contrived in part, as a way to raise money because some of that money is necessary for law suits. If these law suits in any way have caused momentum in the direction of a split, please say so. If funding for these law suits is a concern please estimate how much.

I was very much looking forward to meeting face to face with you and Frank on this matter and trying to convince him that this is a bad, bad idea: I have heard all the factors and reasons given by you in support of this and have analyzed them endlessly: I still cannot disprove the obvious arithmetic and vulnerability as outlined above.

I was disappointed we did not meet with Frank in person.

I can not participate in a free for all conference call. I would find that a most frustrating experience and I am just getting too stressed for any such set up.

Please verify for me that sum of money which represents the bare minimum of annual debt for keeping our claims

Thank you and sincerely your friend

danny

Cc. Frank Candido