Dear Friends,

Let’s first deal with my actions in the financing of my public company. I hope no stockholders get the wrong idea, but even though I intend to live to at least 108, should that expectation be wrong there is a key man insurance policy in place which, if triggered, would carry the company for at least 15 months by itself. That might be a unique method of financing so I’d rather prefer it does not occur.

There is also a written plan for succession. As far as “would I not care to finance goes,” that infers I would shoot myself in the foot, an unlikely event as I have never drawn a salary, have no options or warrants and am a substantial stockholder, the same as many of you are.

Stockholder Breakdown by USA vs. Canadian and Other

The offending news article of late says that 83% of our shareholders are American. That is simply not true. The reality is that 83% of the company’s “registered” shareholders are American. Registered stockholders are either paper certificate shareholders or direct registration stock holders. Registered shareholders make up less than 20% of the company’s total shareholders.

The correct figure, which the media did not fact check, is as follows:

43% of the company’s stockholders are in the US.

57% of the company’s stockholders are Canadian or other.

Therefore, the media’s assertion that 83% of the company’s shareholders are American is another glaring error caused by lack of fact checking.

Accounting Issues

Sarbanes Oxley has made efforts to accommodate corporations smaller than Cargill, IBM and GE but without much success.

You will note from the company’s Annual Statement on page 15 under “Management Discussion and Analysis” the comment, “that we have limited accounting personnel with the expertise in generally accepted accounting principles to enable effective segregation of duties over the transaction process with respect to financial reporting matters and internal controls over financial reporting.”

Following that comment, the remediation we have adopted is outlined. Keep in mind that this is management saying this as a product of Sarbanes Oxley models.

We have on staff a CPA in Toronto who is our CFO and a CPA (the Tanzanian equivalent) in Mwanza where our exploration office is located. We also have four full-time bookkeepers, three in Tanzania and one in the USA. We also have a consultant bookkeeper in the USA. The head of our accounting committee of the Board of Directors holds a CPA and a doctorate in accounting – a rare combination.

Out of a total full time employee roster numbering 53, which does not take into account casuals, six are full time on the accounting process. That seems reasonable to me.

In remediation of our interpretation of Sarbanes Oxley, accounting tasks are now being made as person specific as practical.

We are audited both in Tanzania and in Canada by one of the top four auditing firms internationally.

I call your attention to the signed Auditors letter on page #17 titled “Auditor’s Report to the Shareholders.”

You will note the letter is signed and you should read it to see exactly what it says.

The annual statement is available on our company’s home page at:

www.tanzanianroyaltyexploration.com

Why publish a hatchet article about a company?

1. You really believe the information you have been given or researched feeling you are destined to do the work of God. You assume that markets are no judges of worth as compared to your humble self being motivated to set that wrong as righted.

2. Unknowingly you are working on behalf of a short position usually revealed by a major increase in the reported short two weeks in advance of the article until publishing date when the increase stops.

3. Unknowingly you are working on behalf of a company with interest in acquiring the company or certain assets of the company in discussion of the article.