##### Table of Contents



---

---

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549


Form 10-Q

QUARTERLY REPORT UNDER SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934

[X] Quarterly Report Pursuant to Section 13 or 15(d)
of the Securities Exchange Act of 1934

For the period ended June 30, 2003
or


[  ] Transition Report Pursuant to Section 13 or 15(d) of
the Securities Exchange Act of 1934

For the transition period from                      to


Commission file number 1-11887

CANYON RESOURCES CORPORATION


(a Delaware Corporation)


I.R.S. Employer Identification Number 84-0800747

14142 Denver West Parkway, Suite 250
Golden, CO 80401
(303) 278-8464



| |  | Indicate by check mark whether the registrant (1) has filed all
reports required to be filed by Section 13 or 15(d) of the
Securities Exchange Act of 1934 during the preceding 12 months (or
for such shorter period that the registrant was required to file
such reports), and (2) has been subject to such filing requirements
for the past 90 days. Yes [X]     No [  ]
| |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|
| |  | Indicate by check mark whether registrant is an accelerated filer
(as defined in Rule 12b-2 of the Exchange Act.) Yes  [  ]     No [X]                                                                                                                                                                                                                                      
|
| |  | Indicate the number of shares outstanding of each of the issuers
classes of common stock, as of the latest practicable date:
21,058,320 shares of the Companys Common Stock were outstanding as
of August 1, 2003.                                                                                                                                                        



---

---





---

TABLE OF CONTENTS



|                                                  |                                                                                               |  |  |  |  |  |  | 
|------------------------------------------------- | --------------------------------------------------------------------------------------------- |  |  |  |  |  |  | 
|PART I FINANCIAL INFORMATION                     
|                                                  | Item 1. Financial Statements                                                                 
|                                                  | Item 2. Managements Discussion and Analysis of Financial Condition and Results of Operations
|                                                  | Item 3. Quantitative and Qualitative Disclosures About Market Risk                           
|                                                  | Item 4. Controls and Procedures                                                              
|PART II OTHER INFORMATION                        
|                                                  | Item 1. Legal Proceedings                                                                    
|                                                  | Item 2. Changes in Securities                                                                
|                                                  | Item 3. Defaults Upon Senior Securities                                                      
|                                                  | Item 4. Submission of Matters to Vote of Security Holders                                    
|                                                  | Item 5. Other Information                                                                    
|                                                  | Item 6 Exhibits and Reports on Form 8-K                                                      
|SIGNATURES                                       
|EXHIBIT INDEX                                    
|EX-31.1 Certification of CEO Pursuant to Sec. 302
|EX-31.2 Certification of CFO Pursuant to Sec. 302
|EX-32.1 Certification of CEO Pursuant to Sec. 906
|EX-32.2 Certification of CFO Pursuant to Sec. 906



---



##### Table of Contents



CANYON RESOURCES CORPORATION
FORM 10-Q
For the Quarter ended June 30, 2003

TABLE OF CONTENTS

|                             |                                                                                               |  |         |  | 
|---------------------------- | --------------------------------------------------------------------------------------------- |  | ------- |  | 
|PART I FINANCIAL INFORMATION |                                                                                               |  |         | 
|                             | Item 1. Financial Statements                                                                  |  | Page 1 
|                             | Item 2. Managements Discussion and Analysis of
Financial Condition and Results of Operations |  | Page 19
|                             | Item 3. Quantitative and Qualitative Disclosures About
Market Risk                            |  | Page 24
|                             | Item 4. Controls and Procedures                                                               |  | Page 25
|PART II OTHER INFORMATION    |                                                                                               |  |         | 
|                             | Item 1. Legal Proceedings                                                                     |  | Page 26
|                             | Item 2. Changes in Securities                                                                 |  | Page 26
|                             | Item 3. Defaults Upon Senior Securities                                                       |  | Page 26
|                             | Item 4. Submission of Matters to a Vote of
Security Holders                                   |  | Page 26
|                             | Item 5. Other Information                                                                     |  | Page 26
|                             | Item 6. Exhibits and Reports on Form 8-K                                                      |  | Page 26





---



##### Table of Contents






PART I FINANCIAL INFORMATION




Item 1. Financial Statements

The following unaudited consolidated financial statements have been
prepared by Canyon Resources Corporation (the Company) pursuant to the rules
and regulations of the Securities and Exchange Commission (SEC). Certain
information and footnote disclosures normally included in financial statements
prepared in accordance with generally accepted accounting principles have been
condensed or omitted pursuant to such SEC rules and regulations.

These consolidated financial statements should be read in conjunction with
the financial statements and accompanying notes included in the Companys Form
10-K for the year ended December 31, 2002.

|                                                          |  |          
|--------------------------------------------------------- |  | ---------
|Consolidated
Balance Sheets                               |  | Page 2   
|Consolidated Statements of Operations                     |  | Page 3   
|Consolidated Statements of Cash Flows                     |  | Page 4-5 
|Consolidated Statement of Changes in Stockholders Equity |  | Page 6   
|Notes to Interim Consolidated Financial Statements        |  | Page 7-18

|Item 2. |  | Managements Discussion and Analysis of Financial
Condition and Results of Operations |  | Page 19
|------- |  | ------------------------------------------------------------------------------------- |  | -------
|Item 3. |  | Quantitative and Qualitative Disclosures About
Market Risk                            |  | Page 24
|Item 4. |  | Controls and Procedures                                                               |  | Page 25

1



---



##### Table of Contents



CANYON RESOURCES CORPORATION AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(Unaudited)

|                                                                                                                                                     |                                        |                                            |             |             |            |              |             |             |            | 
|---------------------------------------------------------------------------------------------------------------------------------------------------- | -------------------------------------- | ------------------------------------------ | ----------- | ----------- | ---------- | ------------ | ----------- | ----------- | ---------- | 
|                                                                                                                                                     |                                        |                                            |             | June 30,    |            | December 31,
|                                                                                                                                                     |                                        |                                            |             | 2003        |            | 2002        
|                                                                                                                                                     |                                        |                                            |             |             |            |             
|ASSETS                                                                                                                                               |                                        |                                            |             |             |            |              |             |            
|Cash and cash equivalents                                                                                                                            |                                        | $                                          | 1,593,900   |             |            | $            | 430,800     |            
|Restricted cash                                                                                                                                      |                                        |                                            | 287,100     |             |            |              | 375,100     |            
|Accounts receivable                                                                                                                                  |                                        |                                            | 7,600       |             |            |              | 6,800       |            
|Metal inventories                                                                                                                                    |                                        |                                            | 7,466,200   |             |            |              | 8,787,700   |            
|Materials and supplies                                                                                                                               |                                        |                                            | 156,700     |             |            |              | 187,900     |            
|Prepaid and other assets                                                                                                                             |                                        |                                            | 712,300     |             |            |              | 802,400     |            
|                                                                                                                                                     |                                        |                                            |             |             |            |              |             |            
|                                                                                                                                                     | Total current assets                   |                                            |             | 10,223,800  |            |              |             | 10,590,700  |           
|                                                                                                                                                     |                                        |                                            |             |             |            |              |             |            
|Property and equipment, at cost                                                                                                                      |                                        |                                            |             |             |            |              |             |            
|                                                                                                                                                     | Producing properties                   |                                            |             | 47,380,400  |            |              |             | 43,347,000  |           
|                                                                                                                                                     | Other                                  |                                            |             | 932,300     |            |              |             | 916,300     |           
|                                                                                                                                                     |                                        |                                            |             |             |            |              |             |            
|                                                                                                                                                     |                                        |                                            | 48,312,700  |             |            |              | 44,263,300  |            
|                                                                                                                                                     | Accumulated depreciation and depletion |                                            |             | (42,721,100 | )          |              |             | (38,905,400 | )         
|                                                                                                                                                     |                                        |                                            |             |             |            |              |             |            
|                                                                                                                                                     |                                        | Net property and equipment                 |             |             | 5,591,600  |              |             |             | 5,357,900  | 
|                                                                                                                                                     |                                        |                                            |             |             |            |              |             |            
|Undeveloped mineral claims and leases, net                                                                                                           |                                        |                                            | 17,367,300  |             |            |              | 18,703,300  |            
|Restricted cash                                                                                                                                      |                                        |                                            | 2,805,100   |             |            |              | 2,294,700   |            
|Other assets                                                                                                                                         |                                        |                                            | 57,100      |             |            |              | 79,300      |            
|                                                                                                                                                     |                                        |                                            |             |             |            |              |             |            
|                                                                                                                                                     |                                        | Total Assets                               |             | $           | 36,044,900 |              |             | $           | 37,025,900 | 
|                                                                                                                                                     |                                        |                                            |             |             |            |              |             |            
|LIABILITIES AND STOCKHOLDERS EQUITY                                                                                                                 |                                        |                                            |             |             |            |              |             |            
|Accounts payable                                                                                                                                     |                                        | $                                          | 2,111,900   |             |            | $            | 3,908,700   |            
|Notes payable - current                                                                                                                              |                                        |                                            | 1,326,300   |             |            |              | 1,355,600   |            
|Capital leases - current                                                                                                                             |                                        |                                            | 53,100      |             |            |              | 167,400     |            
|Stock issuance obligation                                                                                                                            |                                        |                                            | 835,800     |             |            |              |            |            
|Unrealized loss on derivative instruments                                                                                                            |                                        |                                            |            |             |            |              | 487,600     |            
|Other current liabilities                                                                                                                            |                                        |                                            | 531,200     |             |            |              | 688,600     |            
|                                                                                                                                                     |                                        |                                            |             |             |            |              |             |            
|                                                                                                                                                     | Total current liabilities              |                                            |             | 4,858,300   |            |              |             | 6,607,900   |           
|Notes payable - long term                                                                                                                            |                                        |                                            | 3,299,000   |             |            |              |            |            
|Capital leases - long term                                                                                                                           |                                        |                                            | 14,200      |             |            |              | 28,400      |            
|Asset retirement obligations                                                                                                                         |                                        |                                            | 4,157,800   |             |            |              | 3,894,200   |            
|                                                                                                                                                     |                                        |                                            |             |             |            |              |             |            
|                                                                                                                                                     | Total Liabilities                      |                                            |             | 12,329,300  |            |              |             | 10,530,500  |           
|                                                                                                                                                     |                                        |                                            |             |             |            |              |             |            
|Commitments and contingencies (Note 10)                                                                                                              |                                        |                                            |             |             |            |              |             |            
|Common stock ($.01 par value) 50,000,000 shares authorized;
issued and outstanding: 21,039,700 at June 30, 2003, and
18,853,400 at December 31, 2002 |                                        |                                            | 210,400     |             |            |              | 188,500     |            
|Capital in excess of par value                                                                                                                       |                                        |                                            | 104,966,200 |             |            |              | 102,957,500 |            
|Deficit                                                                                                                                              |                                        |                                            | (81,461,000 | )           |            |              | (76,650,600 | )          
|                                                                                                                                                     |                                        |                                            |             |             |            |              |             |            
|                                                                                                                                                     | Total Stockholders Equity             |                                            |             | 23,715,600  |            |              |             | 26,495,400  |           
|                                                                                                                                                     |                                        |                                            |             |             |            |              |             |            
|                                                                                                                                                     |                                        | Total
Liabilities and Stockholders Equity |             | $           | 36,044,900 |              |             | $           | 37,025,900 | 
|                                                                                                                                                     |                                        |                                            |             |             |            |              |             |            

The accompanying notes are an integral part of these consolidated financial statements.

2



---



##### Table of Contents



CANYON RESOURCES CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)

|                                                                |                        |    |                             |   |                           |    |            |   |      |    |            |   |            |    |            |   | 
|--------------------------------------------------------------- | ---------------------- | -- | --------------------------- | - | ------------------------- | -- | ---------- | - | ---- | -- | ---------- | - | ---------- | -- | ---------- | - | 
|                                                                |                        |    | Three months ended June 30, |   | Six months ended June 30,
|                                                                |                        |    | 2003                        |   | 2002                      |    | 2003       |   | 2002
|                                                                |                        |    |                             |   |                           |    |            |   |     
|                                                                |                        |    |                             |   |                           |    | (Restated) |   |      |    |            |   | (Restated)
|                                                                | REVENUE                |    |                             |   |                           |    |            |   |      |    |            |   |            |    |            |   | 
|Sales                                                           |                        | $  | 3,387,100                   |   |                           | $  | 2,838,000  |   |      | $  | 7,249,700  |   |            | $  | 6,880,300  |  
|                                                                |                        |    |                             |   |                           |    |            |   |      |    |            |   |            |    |            |  
|                                                                | EXPENSES               |    |                             |   |                           |    |            |   |      |    |            |   |            |    |            |   | 
|Cost of sales                                                   |                        |    | 4,173,500                   |   |                           |    | 3,151,100  |   |      |    | 7,801,700  |   |            |    | 7,192,600  |  
|Depreciation, depletion, & amortization                         |                        |    | 1,545,700                   |   |                           |    | 1,368,900  |   |      |    | 3,630,300  |   |            |    | 2,989,700  |  
|Selling, general & administrative                               |                        |    | 435,400                     |   |                           |    | 410,700    |   |      |    | 845,200    |   |            |    | 740,000    |  
|Exploration and development costs                               |                        |    | 175,100                     |   |                           |    | 192,200    |   |      |    | 390,200    |   |            |    | 291,700    |  
|Accretion expense                                               |                        |    | 46,600                      |   |                           |    |           |   |      |    | 93,100     |   |            |    |           |  
|(Gain) loss on asset disposals                                  |                        |    | 600                         |   |                           |    | (1,172,600 | ) |      |    | (75,700    | ) |            |    | (1,401,500 | )
|                                                                |                        |    |                             |   |                           |    |            |   |      |    |            |   |            |    |            |  
|                                                                |                        |    | 6,376,900                   |   |                           |    | 3,950,300  |   |      |    | 12,684,800 |   |            |    | 9,812,500  |  
|                                                                |                        |    |                             |   |                           |    |            |   |      |    |            |   |            |    |            |  
|                                                                | OTHER INCOME (EXPENSE) |    |                             |   |                           |    |            |   |      |    |            |   |            |    |            |   | 
|Interest income                                                 |                        |    | 6,100                       |   |                           |    | 13,900     |   |      |    | 15,700     |   |            |    | 29,800     |  
|Interest expense                                                |                        |    | (74,200                     | ) |                           |    | (89,400    | ) |      |    | (148,400   | ) |            |    | (178,400   | )
|Unrealized gain (loss) on derivative instruments                |                        |    | 131,500                     |   |                           |    | (134,500   | ) |      |    | 619,100    |   |            |    | (1,052,200 | )
|Other                                                           |                        |    |                            |   |                           |    |           |   |      |    | 150,000    |   |            |    | 19,100     |  
|                                                                |                        |    |                             |   |                           |    |            |   |      |    |            |   |            |    |            |  
|                                                                |                        |    | 63,400                      |   |                           |    | (210,000   | ) |      |    | 636,400    |   |            |    | (1,181,700 | )
|                                                                |                        |    |                             |   |                           |    |            |   |      |    |            |   |            |    |            |  
|Loss before cumulative effect of change in
accounting principle |                        |    | (2,926,400                  | ) |                           |    | (1,322,300 | ) |      |    | (4,798,700 | ) |            |    | (4,113,900 | )
|Cumulative effect of change in
accounting principle             |                        |    |                            |   |                           |    |           |   |      |    | (11,700    | ) |            |    |           |  
|                                                                |                        |    |                             |   |                           |    |            |   |      |    |            |   |            |    |            |  
|Net loss                                                        |                        | ($ | 2,926,400                   | ) |                           | ($ | 1,322,300  | ) |      | ($ | 4,810,400  | ) |            | ($ | 4,113,900  | )
|                                                                |                        |    |                             |   |                           |    |            |   |      |    |            |   |            |    |            |  
|Basic and diluted loss per share:                               |                        |    |                             |   |                           |    |            |   |      |    |            |   |            |    |            |  
|Loss before cumulative effect of change in
accounting principle |                        | ($ | 0.14                        | ) |                           | ($ | 0.07       | ) |      | ($ | 0.23       | ) |            | ($ | 0.23       | )
|Cumulative effect of change in
accounting principle             |                        |    |                            |   |                           |    |           |   |      |    |           |   |            |    |           |  
|                                                                |                        |    |                             |   |                           |    |            |   |      |    |            |   |            |    |            |  
|Basic and diluted net loss per share                            |                        | ($ | 0.14                        | ) |                           | ($ | 0.07       | ) |      | ($ | 0.23       | ) |            | ($ | 0.23       | )
|                                                                |                        |    |                             |   |                           |    |            |   |      |    |            |   |            |    |            |  
|Weighted average shares outstanding                             |                        |    | 21,021,100                  |   |                           |    | 18,914,200 |   |      |    | 20,660,800 |   |            |    | 17,747,200 |  
|                                                                |                        |    |                             |   |                           |    |            |   |      |    |            |   |            |    |            |  

The accompanying notes are an integral part of these consolidated financial statements.

3



---



##### Table of Contents



CANYON RESOURCES CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS(Unaudited)

|                                                     |                                                                             |                                                           |           |            |            |      |            |            |            |  
|---------------------------------------------------- | --------------------------------------------------------------------------- | --------------------------------------------------------- | --------- | ---------- | ---------- | ---- | ---------- | ---------- | ---------- | -
|                                                     |                                                                             | Six months ended June 30                                 
|                                                     |                                                                             |                                                           |           | 2003       |            | 2002
|                                                     |                                                                             |                                                           |           |            |            |     
|                                                     |                                                                             |                                                           |           |            |            |      |            | (Restated)
|Cash flows from operating activities:                |                                                                             |                                                           |           |            |            |      |            |           
|                                                     | Net loss                                                                    |                                                           | ($        | 4,810,400  | )          |      | ($         | 4,113,900  | )         
|                                                     |                                                                             |                                                           |           |            |            |      |            |            |           
|                                                     | Adjustments to reconcile net loss to net cash used in
operating activities: |                                                           |           |            |            |      |            |            |           
|                                                     |                                                                             | Depreciation, depletion and amortization                  |           |            | 3,630,300  |      |            |            | 2,989,700  |  
|                                                     |                                                                             | Amortization of financing costs                           |           |            | 12,200     |      |            |            | 30,600     |  
|                                                     |                                                                             | Cumulative effect of change in accounting principle       |           |            | 11,700     |      |            |            |           |  
|                                                     |                                                                             | Gain on asset dispositions                                |           |            | (75,700    | )    |            |            | (1,401,500 | )
|                                                     |                                                                             | Unrealized (gain) loss on derivative instruments          |           |            | (619,100   | )    |            |            | 1,052,200  |  
|                                                     |                                                                             | Reclassification adjustment of other comprehensive income |           |            |           |      |            |            | (647,800   | )
|                                                     |                                                                             | Other                                                     |           |            | 52,000     |      |            |            | 26,600     |  
|                                                     | Changes in operating assets and liabilities                                 |                                                           |           |            |            |      |            |            |           
|                                                     |                                                                             | Increase in accounts receivable                           |           |            | (800       | )    |            |            | (330,600   | )
|                                                     |                                                                             | (Increase) decrease in inventories                        |           |            | 1,099,100  |      |            |            | (602,800   | )
|                                                     |                                                                             | Decrease in prepaid and other assets                      |           |            | 98,700     |      |            |            | 21,700     |  
|                                                     |                                                                             | Increase in accounts payable and accrued liabilities      |           |            | 21,000     |      |            |            | 414,400    |  
|                                                     |                                                                             | Increase (decrease) in other liabilities                  |           |            | (68,500    | )    |            |            | 64,700     |  
|                                                     |                                                                             | (Increase) decrease in restricted cash                    |           |            | (378,600   | )    |            |            | 105,700    |  
|                                                     |                                                                             |                                                           |           |            |            |      |            |            |           
|                                                     |                                                                             | Total adjustments                                         |           |            | 3,782,300  |      |            |            | 1,722,900  |  
|                                                     |                                                                             |                                                           |           |            |            |      |            |            |           
|                                                     |                                                                             | Net cash used in operating activities                     |           |            | (1,028,100 | )    |            |            | (2,391,000 | )
|                                                     |                                                                             |                                                           |           |            |            |      |            |            |           
|Cash flows from investing activities:                |                                                                             |                                                           |           |            |            |      |            |           
|                                                     | Purchases and development of property and equipment                         |                                                           |           | (371,200   | )          |      |            | (1,003,200 | )         
|                                                     | Proceeds from asset sales                                                   |                                                           |           | 208,600    |            |      |            | 2,791,100  |           
|                                                     | Earnest money applied                                                       |                                                           |           | (22,600    | )          |      |            |           |           
|                                                     | Increase in restricted cash                                                 |                                                           |           | (43,800    | )          |      |            |           |           
|                                                     |                                                                             |                                                           |           |            |            |      |            |            |           
|                                                     |                                                                             | Net cash provided by (used in) investing activities       |           |            | (229,000   | )    |            |            | 1,787,900  |  
|                                                     |                                                                             |                                                           |           |            |            |      |            |            |           
|Cash flows from financing activities:                |                                                                             |                                                           |           |            |            |      |            |           
|                                                     | Issuance of stock                                                           |                                                           |           | 26,000     |            |      |            | 2,171,500  |           
|                                                     | Proceeds from exercise of warrants                                          |                                                           |           | 835,800    |            |      |            |           |           
|                                                     | Proceeds from sale of debentures                                            |                                                           |           | 3,299,000  |            |      |            |           |           
|                                                     | Payments on debt                                                            |                                                           |           | (1,612,100 | )          |      |            | (1,978,100 | )         
|                                                     | Payments on capital lease obligations                                       |                                                           |           | (128,500   | )          |      |            | (733,500   | )         
|                                                     |                                                                             |                                                           |           |            |            |      |            |            |           
|                                                     |                                                                             | Net cash provided by (used in) financing activities       |           |            | 2,420,200  |      |            |            | (540,100   | )
|                                                     |                                                                             |                                                           |           |            |            |      |            |            |           
|Net increase (decrease) in cash and cash equivalents |                                                                             |                                                           | 1,163,100 |            |            |      | (1,143,200 | )         
|Cash and cash equivalents, beginning of year         |                                                                             |                                                           | 430,800   |            |            |      | 1,618,100  |           
|                                                     |                                                                             |                                                           |           |            |            |      |            |            |           
|Cash and cash equivalents, end of period             |                                                                             | $                                                         | 1,593,900 |            |            | $    | 474,900    |           
|                                                     |                                                                             |                                                           |           |            |            |      |            |            |           

The accompanying notes are an integral part of these consolidated financial statements.

4



---



##### Table of Contents



CANYON RESOURCES CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS, continued
(Unaudited)

Supplemental disclosures of cash flow information:



|1. |  | The Company paid $136,200 of interest during the first six months of
2003, and $124,900 during the corresponding period of 2002.
|-- |  | --------------------------------------------------------------------------------------------------------------------------------
|  
|2. |  | The Company paid no income taxes during the first six months of 2003 nor
the corresponding period of 2002.                      

Supplemental schedule of noncash investing and financing activities:



|1. |  | The Company financed an equipment lease buy-out in the amount of
$1,582,800 during the first six months of 2003.                                                                                                                                                                                                                                             
|-- |  | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|  
|2. |  | The Company issued 2,099,600 shares of common stock with a fair market
value of $1,952,600 to a creditor as payment for services during the first
six months of 2003. During the first six months of 2002, the Company
issued 1,337,100 shares of common stock with a fair market value of
$1,722,000 to certain creditors as payment for goods and services.
|  
|3. |  | The Company issued 55,800 shares of common stock with a fair market value
of $52,000 to an employee as compensation for services during the first
six months of 2003. During the first six months of 2002, the Company
issued 29,400 shares of common stock with a fair market value of $26,600
to an employee as compensation for services.                 

The accompanying notes are an integral part of these consolidated financial statements.

5



---



##### Table of Contents



CANYON RESOURCES CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENT OF CHANGES IN STOCKHOLDERS EQUITY
(Unaudited)

|                                              |                    |                          |            |              |   |            |         |               |   |          |             |               |   |    |            |            |   |   |            |            |   | 
|--------------------------------------------- | ------------------ | ------------------------ | ---------- | ------------ | - | ---------- | ------- | ------------- | - | -------- | ----------- | ------------- | - | -- | ---------- | ---------- | - | - | ---------- | ---------- | - | 
|                                              |                    |                          |            | Common Stock |   | Capital in |         |               |   |          |             | Common       
|                                              |                    |                          |            | Number of    |   | At Par     |         | Excess of Par |   | Retained |             | Shareholders
|                                              |                    |                          |            | Shares       |   | Value      |         | Value         |   | Deficit  |             | Equity       
|                                              |                    |                          |            |              |   |            |         |               |   |          |             |              
|Balances, December 31, 2002                   |                    |                          | 18,853,400 |              |   | $          | 188,500 |               |   | $        | 102,957,500 |               |   | ($ | 76,650,600 | )          |   | $ | 26,495,400 |           
|Stock issued in payment of
goods and services |                    |                          | 2,099,600  |              |   |            | 21,000  |               |   |          | 1,931,600   |               |   |    |           |            |   |   | 1,952,600  |           
|Other stock issued                            |                    |                          | 55,800     |              |   |            | 600     |               |   |          | 51,400      |               |   |    |           |            |   |   | 52,000     |           
|Exercise of stock options                     |                    |                          | 30,900     |              |   |            | 300     |               |   |          | 25,700      |               |   |    |           |            |   |   | 26,000     |           
|Comprehensive loss                            |                    |                          |            |              |   |            |         |               |   |          |             |               |   |    |            |            |   |   |            |           
|                                              | Net loss           |                          |            |              |   |            |         |               |   |          |             |               |   |    |            | (4,810,400 | ) |   |            | (4,810,400 | )
|                                              |                    | Other comprehensive loss |            |              |  |            |         |               |  |          |             |               |  |    |            |            |  |   |            |            |  | 
|                                              |                    |                          |            |              |   |            |         |               |   |          |             |               |   |    |            |            |   |   |            |           
|                                              | Comprehensive loss |                          |            |              |   |            |         |               |   |          |             |               |   |    |            | (4,810,400 | ) |   |            | (4,810,400 | )
|                                              |                    |                          |            |              |   |            |         |               |   |          |             |               |   |    |            |            |   |   |            |           
|Balances, June 30, 2003                       |                    |                          | 21,039,700 |              |   | $          | 210,400 |               |   | $        | 104,966,200 |               |   | ($ | 81,461,000 | )          |   | $ | 23,715,600 |           
|                                              |                    |                          |            |              |   |            |         |               |   |          |             |               |   |    |            |            |   |   |            |           

The accompanying notes are an integral part of these consolidated financial statements.

6



---



##### Table of Contents



CANYON RESOURCES CORPORATION
NOTES TO INTERIM CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)



|1. |  | Restatement of Prior Financial Information:
|-- |  | -------------------------------------------

As further discussed in Note 15, the Company has restated its financial
statements for the three and six months ended June 30, 2002. Overall, the
adjustments increased the Companys net loss in the second quarter of 2002 by
$622,900, or $0.03 per share. For the six months ended June 30, 2002, the
adjustments increased the Companys net loss by $1,037,200, or $0.06 per share.
The adjustments were i) to expense previously capitalized costs for the
McDonald Gold Project; ii) to commence amortizing the carrying values of the
McDonald and Seven-Up Pete mineral property interests upon adoption on January
1, 2002 of Statement of Financial Accounting Standards No. 142, Goodwill and
Other Intangible Assets; and iii) to include depreciation, depletion and
amortization as a cost in inventories at the Companys Briggs Mine. See also
Note 19 to the Companys Consolidated Financial Statements included in its 2002
Form 10-K filing for further discussion of the restatements.



|2. |  | Basis of Presentation:
|-- |  | ----------------------

During interim periods, Canyon Resources (the Company) follows the
accounting policies set forth in its Annual Report to Stockholders and its
Report on Form 10-K filed with the Securities and Exchange Commission. Users of
financial information produced for interim periods are encouraged to refer to
the footnotes contained in the Annual Report to Stockholders when reviewing
interim financial results.

In the opinion of management, the accompanying interim financial
statements contain all material adjustments, consisting only of normal
recurring adjustments necessary to present fairly the financial position, the
results of operations, and the cash flows of Canyon Resources and its
consolidated subsidiaries for interim periods. These interim results are not
necessarily indicative of the results of operations or cash flows for the full
year ending December 31, 2003.



|3. |  | Management Estimates and Assumptions:
|-- |  | -------------------------------------

Certain amounts included in or affecting the Companys financial
statements and related disclosures must be estimated, requiring that certain
assumptions be made with respect to values or conditions which cannot be made
with certainty at the time the financial statements are prepared. Therefore,
the reported amounts of the Companys assets and liabilities, revenues and
expenses, and associated disclosures with respect to contingent assets and
obligations are necessarily affected by these estimates. The Company evaluates
these estimates on an ongoing basis, utilizing historical experience,
consultation with experts, and other methods considered reasonable in the
particular circumstances. Nevertheless, actual results may differ significantly
from the Companys estimates.



|4. |  | Adoption of New Accounting Standard:
|-- |  | ------------------------------------

On January 1, 2003, the Company became subject to the accounting and
reporting requirements of Statement of Financial Accounting Standards No. 143,
Accounting for Asset Retirement Obligations(SFAS No. 143). SFAS No. 143
establishes accounting and reporting standards for obligations associated with
the retirement of tangible long-lived assets and the associated asset
retirement costs. SFAS No. 143 requires that the fair value of a liability for
an asset retirement obligation be recognized in the period in which it is
incurred if a reasonable estimate of fair value can be made. Fair value is
determined by estimating the retirement obligations in the period
an asset is first placed in service and then adjusting the amount for estimated
inflation and market risk contingencies to the projected settlement date of the
liability. The result is then discounted to a present value from the projected
settlement date to the date the asset was first placed in service. The
present value of the asset

7



---



##### Table of Contents



CANYON RESOURCES CORPORATION
NOTES TO INTERIM CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)



|4. |  | Adoption of New Accounting Standard, continued:
|-- |  | -----------------------------------------------

retirement obligation is recorded as an additional property cost and as an
asset retirement liability. The amortization of the additional property cost
(using the units of production method) is included in depreciation, depletion
and amortization expense and the accretion of the discounted liability is
recorded as a separate operating expense in the Companys Statement of
Operations.

Prior to adoption of SFAS No. 143, an accrual for the Companys estimated
asset retirement obligations (site specific reclamation costs for earthwork,
revegetation, water treatment and dismantlement of facilities) was made using
the units of production method over the life of the property and was included
in cost of sales. Upon adoption, the Company recorded a loss of $11,700 as the
cumulative effect of a change in accounting principle.

The pro forma effects on net income and per share amounts before
cumulative effect of a change in accounting principle for the three and six
months ended June 30, 2002 as if the Company had adopted SFAS No. 143 on
January 1, 2002 are presented below.

|                                                                                             |             |    |               |      |               |    |           |      |  
|-------------------------------------------------------------------------------------------- | ----------- | -- | ------------- | ---- | ------------- | -- | --------- | ---- | -
|                                                                                             |             |    | THREE MONTHS  |      | SIX MONTHS   
|                                                                                             |             |    | ENDED         |      | ENDED        
|                                                                                             |             |    | JUNE 30, 2002 |      | JUNE 30, 2002
|                                                                                             |             |    |               |      |              
|Loss before cumulative effect of change in accounting principle as reported                  |             | ($ | 1,322,300     | )    |               | ($ | 4,113,900 | )   
|Accretion expense                                                                            |             |    | (45,800       | )    |               |    | (91,600   | )   
|Additional depreciation expense                                                              |             |    | (30,000       | )    |               |    | (74,900   | )   
|Reduction for reclamation accrual in cost of sales                                           |             |    | 32,900        |      |               |    | 82,300    |     
|                                                                                             |             |    |               |      |               |    |           |     
|Pro forma loss before cumulative effect of change in accounting principle                    |             | ($ | 1,365,200     | )    |               | ($ | 4,198,100 | )   
|                                                                                             |             |    |               |      |               |    |           |     
|Basic and diluted loss per share before cumulative effect of change in accounting
principle: |             |    |               |      |               |    |           |     
|                                                                                             | As reported |    | ($            | 0.07 | )             |    | ($        | 0.23 | )
|                                                                                             | Pro forma   |    | ($            | 0.07 | )             |    | ($        | 0.23 | )

The following provides a reconciliation of the Companys beginning and
ending carrying values for its asset retirement obligations in the current
year:

|                                |  |   |           |  
|------------------------------- |  | - | --------- | -
|Balance, December 31, 2002      |  | $ | 4,122,200 |  
|Impact of adopting SFAS No. 143 |  |   | 332,000   |  
|Settlement of liabilities       |  |   | (161,500  | )
|Accretion expense               |  |   | 93,100    |  
|                                |  |   |           |  
|Balance, June 30, 2003          |  |   | 4,385,800 |  
|Current portion*                |  |   | 228,000   |  
|                                |  |   |           |  
|Non current portion             |  | $ | 4,157,800 |  
|                                |  |   |           |  

*Included in other current liabilities

8



---



##### Table of Contents



CANYON RESOURCES CORPORATION
NOTES TO INTERIM CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)



|5. |  | Restricted Cash:
|-- |  | ----------------

Restricted cash consisted of the following at:

|                                                                 |  |          |           |              |  |   |           | 
|---------------------------------------------------------------- |  | -------- | --------- | ------------ |  | - | --------- | 
|                                                                 |  | June 30, |           | December 31,
|                                                                 |  | 2003     |           | 2002        
|                                                                 |  |          |           |             
|Collateral for Letter of Credit (a)                              |  | $        | 249,000   |              |  | $ | 249,000   | 
|Collateral for reclamation bonds and other contingent events (b) |  |          | 150,100   |              |  |   | 149,400   | 
|Kendall Mine reclamation (c)                                     |  |          | 1,906,000 |              |  |   | 1,896,300 | 
|McDonald Gold Project cash reclamation bond (d)                  |  |          | 500,000   |              |  |   |          | 
|Unexpended proceeds from gold sales (e)                          |  |          |          |              |  |   | 131,900   | 
|Net proceeds from property sales (f)                             |  |          | 247,100   |              |  |   | 182,000   | 
|Escrow deposits (g)                                              |  |          | 40,000    |              |  |   | 61,200    | 
|                                                                 |  |          |           |              |  |   |           | 
|                                                                 |  |          | 3,092,200 |              |  |   | 2,669,800 | 
|Current portion                                                  |  |          | 287,100   |              |  |   | 375,100   | 
|                                                                 |  |          |           |              |  |   |           | 
|Noncurrent portion                                               |  | $        | 2,805,100 |              |  | $ | 2,294,700 | 
|                                                                 |  |          |           |              |  |   |           | 



| | (a) |  | In connection with the issuance of certain bonds for the
performance of reclamation obligations and other contingent
events at the Briggs Mine, a bank Letter of Credit was provided
in favor of the Surety as partial collateral for such bond
obligations. The Letter of Credit is fully collateralized with
cash and will expire no earlier than December 31, 2003, and at
the banks option, may be renewed for successive one-year
periods.
| | --- |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|
| | (b) |  | Held directly by the Surety as partial collateral for
reclamation and other contingent events at the Briggs Mine.                                                                                                                                                                                                                                                                                                                               
|
| | (c) |  | Held directly by the Montana Department of Environmental
Quality in an interest bearing account for use in continuing
reclamation at the Kendall minesite.                                                                                                                                                                                                                                                                                      
|
| | (d) |  | Held directly by the Montana Department of Environmental
Quality for reclamation at the McDonald Gold Property.                                                                                                                                                                                                                                                                                                                                 
|
| | (e) |  | The Briggs Mine loan facility required all proceeds from
gold sales to be held in trust and disbursed from the collected
credit balance in certain orders of priority. The outstanding
balance on the loan facility was paid off on February 28, 2003.                                                                                                                                                                                          
|
| | (f) |  | In connection with the auction of certain properties,
cash has been sequestered by court order pending a trial
scheduled in October 2003 (See Note 10(e)).                                                                                                                                                                                                                                                                                      
|
| | (g) |  | Earnest money received in connection with contracted
property sales in 2002 which have not yet closed are being held
by the Companys escrow agent.                                                                                                                                                                                                                                                                                             

9



---



##### Table of Contents



CANYON RESOURCES CORPORATION
NOTES TO INTERIM CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)



|6. |  | Inventories:
|-- |  | ------------

Metal inventories consisted of the following at:

|                       |  |               |           |                   |  |   |           | 
|---------------------- |  | ------------- | --------- | ----------------- |  | - | --------- | 
|                       |  | June 30, 2003 |           | December 31, 2002
|                       |  |               |           |                  
|Broken ore under leach |  | $             | 7,181,300 |                   |  | $ | 8,428,200 | 
|Doré                   |  |               | 284,900   |                   |  |   | 359,500   | 
|                       |  |               |           |                   |  |   |           | 
|                       |  | $             | 7,466,200 |                   |  | $ | 8,787,700 | 
|                       |  |               |           |                   |  |   |           | 



|7. |  | Undeveloped Mineral Claims and Leases:
|-- |  | --------------------------------------

The carrying value of the Companys undeveloped mineral claims and leases
consists of the following components at:

|          |               |   |                |            |                   |    |             |           |          |   |              |            |             |   |            |            |  |    |           |           |   |   |            |            | 
|--------- | ------------- | - | -------------- | ---------- | ----------------- | -- | ----------- | --------- | -------- | - | ------------ | ---------- | ----------- | - | ---------- | ---------- |  | -- | --------- | --------- | - | - | ---------- | ---------- | 
|          |               |   | June 30, 2003  |            | December 31, 2002
|          |               |   |                |            |                  
|          |               |   |                |            | Gross             |    |             |           |          |   |              |            |            
|          |               |   |                |            |                   |    | Accumulated |           | Net Book |   | Carrying     |            | Accumulated |   | Net Book  
|          |               |   | Carrying Value |            | Amortization      |    | Value       |           | Value    |   | Amortization |            | Value      
|          |               |   |                |            |                   |    |             |           |          |   |              |            |            
|Property: |               |   |                |            |                   |    |             |           |          |   |              |            |             |   |            |            |  |    |           |           |   |   |            |           
|          | McDonald      |   | $              | 16,200,200 |                   |    | ($          | 3,037,500 | )        |   | $            | 13,162,700 |             |   | $          | 16,200,200 |  |    | ($        | 2,025,000 | ) |   | $          | 14,175,200 | 
|          | Seven-Up Pete |   |                | 5,175,000  |                   |    |             | (970,400  | )        |   |              | 4,204,600  |             |   |            | 5,175,000  |  |    |           | (646,900  | ) |   |            | 4,528,100  | 
|          |               |   |                |            |                   |    |             |           |          |   |              |            |             |   |            |            |  |    |           |           |   |   |            |           
|          |               | $ | 21,375,200     |            |                   | ($ | 4,007,900   | )         |          | $ | 17,367,300   |            |             | $ | 21,375,200 |            |  | ($ | 2,671,900 | )         |   | $ | 18,703,300 |           
|          |               |   |                |            |                   |    |             |           |          |   |              |            |             |   |            |            |  |    |           |           |   |   |            |           

These properties are being amortized over eight years with no residual
value. See Note 10(d) for a discussion of the legal status of the properties.



|8. |  | Notes Payable:
|-- |  | --------------

Notes payable consisted of the following at:

|                           |  |               |           |                   |  |   |           | 
|-------------------------- |  | ------------- | --------- | ----------------- |  | - | --------- | 
|                           |  | June 30, 2003 |           | December 31, 2002
|                           |  |               |           |                  
|Briggs Facility (a)        |  | $             |          |                   |  | $ | 1,355,600 | 
|Caterpillar Finance (b)    |  |               | 1,326,300 |                   |  |   |          | 
|Debentures (c)             |  |               | 3,299,000 |                   |  |   |          | 
|                           |  |               |           |                   |  |   |           | 
|                           |  |               | 4,625,300 |                   |  |   | 1,355,600 | 
|Current portion            |  |               | 1,326,300 |                   |  |   | 1,355,600 | 
|                           |  |               |           |                   |  |   |           | 
|Notes payable  Noncurrent |  | $             | 3,299,000 |                   |  | $ |          | 
|                           |  |               |           |                   |  |   |           | 



| | (a) |  | The outstanding balance on this facility was paid off on
February 28, 2003. The weighted average interest rate during the
first two months of 2003 was 4.9%.                                                                      
| | --- |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|
| | (b) |  | In January 2003, the Company exercised a lease purchase option
to buy the mining fleet at the Briggs Mine for approximately $1.6
million and has arranged to finance the purchase price for one year
at an interest rate of 6.75%.

10



---



##### Table of Contents



CANYON RESOURCES CORPORATION
NOTES TO INTERIM CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)



|8. |  | Notes Payable, continued:
|-- |  | -------------------------



| | (c) |  | In March 2003, the Company completed a private placement
financing of 6%, two year convertible debentures. The debentures
require quarterly interest payments, and the holders have the right
to convert principal to common stock of the Company, subject to
certain adjustments, at any time at a conversion rate of $1.38 per
share of common stock.
| | --- |  | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



|9. |  | Stock Issuance Obligation:                                                                                                                                                                                                                   
|-- |  | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|  
|   |  | In connection with an exchange offer to certain holders of outstanding
warrants as more fully described in Note 17, the Company had received, as
of June 30, 2003, $835,800 for the purchase of 619,107 shares of the
Companys common stock.



|10. |  | Commitments and
Contingencies:
|--- |  | ------------------------------



| | (a) |  | Kendall Mine Reclamation                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
| | --- |  | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|
| |     |  | The Kendall Mine operates under permits granted by the Montana
Department of Environmental Quality (DEQ). In February 2002, the DEQ
issued a decision that a comprehensive Environmental Impact Statement
(EIS) is needed for completion of remaining reclamation at Kendall. The
Company feels that it is crucial that reclamation proceed at Kendall
without further delay and, therefore, disagrees with the agency
decision, and is presently evaluating its course of action with regard
to the DEQs decision. The Companys estimate to achieve mine closure
could be impacted by the outcome of an agency decision following an
EIS. The Company has $1,906,000 on deposit in an interest bearing
account with the DEQ for reclamation at the Kendall Mine.                  
|
| | (b) |  | Briggs Mine Surety Bonds                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|
| |     |  | The Briggs Mine operates under permits granted by various agencies
including the U.S. Bureau of Land Management (BLM), Inyo County, the
California Department of Conservation, and the Lahontan Regional Water
Quality Control Board (Lahontan). These agencies have jointly required
the Company to post a reclamation bond in the amount of $3,030,000 to
ensure appropriate reclamation. Additionally, the Company was required
by Lahontan to post a $1,010,000 bond to ensure adequate funds to
mitigate any foreseeable release, as defined, of pollutants to state
waters. Both bonds are subject to annual review and adjustment.                                                                                                                                          
|
| |     |  | In 2000, in response to a demand for an increase in collateral by the
Surety who issued the above described bonds, the Company granted a
security interest in 28,000 acres of mineral interests in Montana. In
addition, the Company agreed to make cash deposits with the Surety
totaling $1.5 million over a three year period at the rate of $0.5
million per year, commencing June 30, 2001. The Company has not made
any deposits to date, and is in discussions with the Surety to
reschedule the deposit requirements. If an acceptable rescheduling of
the deposit requirements cannot be agreed to,
the Surety could seek to terminate the bonds which could result in the
Company becoming liable for the principal amounts under its collateral
agreement with the Surety.

11



---



##### Table of Contents



CANYON RESOURCES CORPORATION
NOTES TO INTERIM CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)



|10. |  | Commitments and Contingencies, continued:
|--- |  | -----------------------------------------



| | (c) |  | Contingent Liability:                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
| | --- |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|
| |     |  | On September 25, 1997, the Company, together with its wholly-owned
subsidiary, CR Montana Corporation (CR Montana), purchased a 72.25%
participating interest and underlying assets in the Seven-Up Pete
Venture (SPV) from CR Montanas partner in the SPV, Phelps Dodge
Corporation (Phelps Dodge). The Company and its wholly-owned subsidiary
now own 100% of the SPV. The SPV includes the McDonald Gold Project
near Lincoln, Montana.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|
| |     |  | The Company made an initial payment of $5 million and is required to
make a final payment of $10.0 million upon issuance of all permits
required for construction of the McDonald Gold Project, or
alternatively, one-third of any proceeds received from a takings
lawsuit. Due to the contingent nature of the transaction, the Company
recorded only the initial payment of $5 million as additions to mining
claims and leases.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|
| |     |  | The purchase payments are collateralized only by the 72.25%
participating interest and underlying assets in the SPV transferred
from Phelps Dodge to the Company and CR Montana in this transaction,
and the 50% co-tenancy interest in certain real property also
transferred to the Company and CR Montana.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|
| | (d) |  | Anti-Mining Initiative (I-137)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|
| |     |  | In November 1998, the Montana electorate passed an anti-mining
initiative (I-137) by a vote of 52% to 48%. I-137, as modified by the
State Legislature in April 1999, bans development of new gold and
silver mines, which use open-pit mining methods and cyanide in the
treatment and recovery process. In April 2000, the SPV filed lawsuits
in Montana State District Court and in the United States District
Court, seeking to have I-137 declared unconstitutional, or,
alternatively, to obtain a takings or damage award for the lost value
of the McDonald, Seven-Up Pete and Keep Cool mineral properties. These
lawsuits are based on, amongst others, (i) the right not to be deprived
of property without due process of law; (ii) the right to equal
protection under the laws; and (iii) the right to be protected against
laws which impair the obligations of existing contracts. The United
States District Court issued a ruling August 30, 2001 in which the
Court dismissed the SPVs substantive due process claim but, as
requested by the SPV, ruled that the remainder of the SPVs claims
could be pursued at such time as the State lawsuit was concluded. The
Montana State District Court issued a ruling November 1, 2001 in
response to a Motion to Dismiss and a Motion For Summary Judgment by
the State of Montana. In this ruling, the Court dismissed four of the
SPVs fourteen counts, including its substantive due process and equal
protection challenges to I-137s validity. The decision maintained for
adjudication the contract impairment validity challenge, contract
damage claims, and all of the takings claims. Following the November
2001 ruling by the State District Court, the State filed a new Motion
for Summary Judgment as to all claims. In an Order dated December 9,
2002, the Court granted the State Summary Judgment on all of the
remaining legal claims of the Companys lawsuit. On January 14, 2003,
the Company filed an appeal with the Montana State Supreme Court.

12



---



##### Table of Contents



CANYON RESOURCES CORPORATION
NOTES TO INTERIM CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)



|10. |  | Commitments and Contingencies, continued:
|--- |  | -----------------------------------------



| | (e) |  | Kendall Mine Lawsuit                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
| | --- |  | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|
| |     |  | In October 2001, a Plaintiff group filed suit in Montana District Court
against the Company and its wholly-owned subsidiary, CR Kendall
Corporation, alleging violation of water rights and other torts in
connection with the operation of the Kendall Mine. The Complaint seeks
unspecified damages and punitive damages. The Company believes the
allegations are completely without merit and that the Company will
prevail in this matter.                                                                                                                                 
|
| |     |  | In August 2002, a Preliminary Injunction was issued in Montana District
Court on behalf of the Plaintiff group in connection with the Companys
auction of certain mineral rights and fee lands in western Montana. In
October 2002, the Court issued a Supplemental Order which will
sequester up to $528,000 of any proceeds realized from the auction
until such time as the lawsuit is concluded. As of June 30, 2003,
$247,100 had been remitted to the Court as required by the Order. The
Company has filed an appeal to this Order with the Montana State
Supreme Court.



|11. |  | Derivative Instruments and Price Protection Arrangements:
|--- |  | ---------------------------------------------------------

During the second quarter of 2003, the Company entered into a forward
sales contract on 10,000 ounces of gold at a price of $364 per ounce, and, at
June 30, 2003, had 7,250 ounces outstanding on the contract. The fair market
value of the contract at June 2003, 2003 was $131,500 more than the contractual
amount. During the first quarter of 2003, the Company closed out all forward
contracts that existed at December 31, 2002 (6,300 ounces at an average price
of approximately $270 per ounce) at scheduled delivery dates with its
counterparties. Unrealized gains and losses on the Companys forward contracts
resulting from period to period changes in the mark-to-market calculations are
as follows:

|                       |  |                             |         |                          |  |      |           |      |  |   |         |  |  |  |             |  
|---------------------- |  | --------------------------- | ------- | ------------------------ |  | ---- | --------- | ---- |  | - | ------- |  |  |  | ----------- | -
|                       |  | THREE MONTHS ENDED JUNE 30, |         | SIX MONTHS ENDED JUNE 30
|                       |  |                             |         |                         
|                       |  | 2003                        |         | 2002                     |  | 2003 |           | 2002
|                       |  |                             |         |                          |  |      |           |     
|Unrealized gain (loss) |  | $                           | 131,500 |                          |  |      | ($134,500 | )    |  | $ | 619,100 |  |  |  | ($1,052,200 | )

These unrealized gains and losses are shown as a separate line item in the
other income (expense) section in the Statement of Operations.

On June 30, 1999, the Company converted its Briggs Mine gold loan to a
cash loan. In connection with the conversion, the Company reduced the
monetized amount of the debt to fair value, resulting in a gain of $2,528,000,
which was deferred and reported as a liability in the consolidated balance
sheet. On January 1, 2001, the Company adopted SFAS No. 133 and reclassified
this amount as a cumulative effect adjustment in other comprehensive income.
For the six months ended June 30, 2002, $0.3 million of the gain was recognized
and is included in revenues in the Statement of Operations. There was no
comparable activity in the current year.

13



---



##### Table of Contents



CANYON RESOURCES CORPORATION
NOTES TO INTERIM CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)



|12. |  | Earnings per Share (EPS):
|--- |  | -------------------------

The Company computes EPS by applying the provisions of Financial
Accounting Standards No. 128, Earnings per Share. As the Company reported net
losses for the periods presented, inclusion of common stock equivalents would
have an antidilutive effect on per share amounts. Accordingly, the Companys
basic and diluted EPS computations are the same for the periods presented.
Common stock equivalents for the three months and six months ended June 30,
2003 that were not included in the computation of diluted EPS because the
effect would be antidilutive were 4,869,400 and 4,070,300, respectively. For
the three and six months ended June 30, 2002, common stock equivalents that
were not included in the computation of diluted EPS were 2,354,200 and
1,568,500, respectively.



|13. |  | Stock Based Compensation
|--- |  | ------------------------

In accordance with the provisions of SFAS No. 123, Accounting for
Stock-Based Compensation(SFAS No. 123), the Company measures compensation cost
using the intrinsic value based method prescribed by Accounting Principles
Board (APB) Opinion No. 25, Accounting for Stock Issued to Employees, and
related interpretations to account for its stock option plans. As a result, no
compensation cost has been recognized in the accompanying financial statements
as the exercise price of all stock option grants is at least equal to 100% of
the market price of the Companys common stock at the date of grant. Had
compensation cost been recorded under the fair value provisions of SFAS No.
123, the following pro forma net loss and per share amounts would have been
recorded for the following periods:

|                                                                   |  |                            |           |                          |  |      |           |      |  |    |           |   |  |    |           |  
|------------------------------------------------------------------ |  | -------------------------- | --------- | ------------------------ |  | ---- | --------- | ---- |  | -- | --------- | - |  | -- | --------- | -
|                                                                   |  | THREE MONTHS ENDED JUNE 30 |           | SIX MONTHS ENDED JUNE 30
|                                                                   |  |                            |           |                         
|                                                                   |  | 2003                       |           | 2002                     |  | 2003 |           | 2002
|                                                                   |  |                            |           |                          |  |      |           |     
|Net loss, as reported                                              |  | ($                         | 2,926,400 | )                        |  | ($   | 1,322,300 | )    |  | ($ | 4,810,400 | ) |  | ($ | 4,113,900 | )
|Add: compensation expense
determined under fair
value based method |  |                            | (21,700   | )                        |  |      | (72,800   | )    |  |    | (50,700   | ) |  |    | (105,500  | )
|                                                                   |  |                            |           |                          |  |      |           |      |  |    |           |   |  |    |           |  
|Pro forma net loss                                                 |  | ($                         | 2,948,100 | )                        |  | ($   | 1,395,100 | )    |  | ($ | 4,861,100 | ) |  | ($ | 4,219,400 | )
|                                                                   |  |                            |           |                          |  |      |           |      |  |    |           |   |  |    |           |  
|Basic and diluted loss per
share                                   |  |                            |           |                          |  |      |           |      |  |    |           |   |  |    |           |  
| As reported                                                      |  | ($                         | 0.14      | )                        |  | ($   | 0.07      | )    |  | ($ | 0.23      | ) |  | ($ | 0.23      | )
| Pro forma                                                        |  | ($                         | 0.14      | )                        |  | ($   | 0.07      | )    |  | ($ | 0.23      | ) |  | ($ | 0.24      | )



|14. |  | Income Taxes:
|--- |  | -------------

The Company has not recorded a tax benefit for the current period as the
benefit is not expected to be realized during the year. The benefit is also not
expected to be realizable as a deferred tax asset at year end as the Company
anticipates recording a full valuation allowance for all deferred tax assets,
except to the extent of offsetting reversals of expected deferred tax
liabilities.



|15. |  | Restatement of Prior Financial Information:
|--- |  | -------------------------------------------

The Company has determined that certain previously capitalized costs for
the McDonald Gold Project should be expensed. In November 1998, the Montana
electorate passed an anti-mining initiative, I-137, which

14



---



##### Table of Contents



CANYON RESOURCES CORPORATION
NOTES TO INTERIM CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)



|15. |  | Restatement of Prior Financial Information, continued:
|--- |  | ------------------------------------------------------

bans development of new gold and silver mines which use open-pit mining
methods and cyanide in the treatment and recovery process. As a result of the
legal impediment, the Company cannot presently proceed with the development of
the McDonald Gold Project. Accordingly, the Company has restated its prior
financial information to remove all costs capitalized since I-137 took effect.
This adjustment increased the Companys net loss by $189,000, or $0.01 per
share and $286,100, or $0.02 per share for the three and six months ended June
30, 2002, respectively.

On January 1, 2002, the Company became subject to the accounting and
reporting requirements of Statement of Financial Accounting Standards No. 142,
Goodwill and Other Intangible Assets(SFAS No. 142). As the Companys mineral
interests in the McDonald and Seven-Up Pete properties represent intangible
assets as defined in this new standard, the Company has commenced amortizing
the carrying values of these properties taking into account residual values
over their useful lives. This adjustment increased the Companys net loss by
$668,000, or $0.03 per share and $1,336,000, or $0.07 per share, for the three
and six months ended June 30, 2002, respectively.

The Company has restated its prior financial information to include
depreciation, depletion and amortization (DD&A) as a cost in inventories at the
Briggs Mine. Previously, the Company recorded DD&A as a period expense. In
addition, the Company changed from recognizing units-of-production (UOP) DD&A
based on the volume of gold sold to recognizing UOP DD&A based on estimated
recoverable ounces mined or produced from proven and provable reserves to
accommodate the capitalization of DD&A in inventory. This adjustment decreased
the Companys net loss by $234,100, or $0.01 per share and $584,900, or $0.03
per share, for the three and six months ended June 30, 2002, respectively.

The following sets forth the effects of the aforementioned adjustments to
the Companys Consolidated Statements of Operations for the three and six
months ended June 30, 2002, and Consolidated Statement of Cash Flows for the
six months ended June 30, 2002.

15



---



##### Table of Contents



CANYON RESOURCES CORPORATION
NOTES TO INTERIM CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)



|15. |  | Restatement of Prior Financial Information, continued:
|--- |  | ------------------------------------------------------

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

|                                         |                                     |    |                                  |            |          |    |           |            |          |   |          |            |  |    |            |            |  
|---------------------------------------- | ----------------------------------- | -- | -------------------------------- | ---------- | -------- | -- | --------- | ---------- | -------- | - | -------- | ---------- |  | -- | ---------- | ---------- | -
|                                         |                                     |    | Three Months Ended June 30, 2002
|                                         |                                     |    |                                 
|                                         |                                     |    | As Previously                    |            | McDonald |    | Briggs    |            | As      
|                                         |                                     |    | Reported                         |            | Property |    | Inventory |            | Restated
|                                         |                                     |    |                                  |            |          |    |           |            |         
|                                         | REVENUE                             |    |                                  |            |          |    |           |            |          |   |          |            |  |    |            |            |  
|Sales                                    |                                     | $  | 2,838,000                        |            |          | $  |          |            |          | $ |         |            |  | $  | 2,838,000  |           
|                                         |                                     |    |                                  |            |          |    |           |            |          |   |          |            |  |    |            |           
|                                         | EXPENSES                            |    |                                  |            |          |    |           |            |          |   |          |            |  |    |            |            |  
|Cost of sales                            |                                     |    | 3,215,400                        |            |          |    |          |            |          |   | (64,300  | )          |  |    | 3,151,100  |           
|Depreciation, depletion and amortization |                                     |    | 863,100                          |            |          |    | 675,600   |            |          |   | (169,800 | )          |  |    | 1,368,900  |           
|Selling, general and administrative      |                                     |    | 410,700                          |            |          |    |          |            |          |   |         |            |  |    | 410,700    |           
|Exploration and development costs        |                                     |    | 10,800                           |            |          |    | 181,400   |            |          |   |         |            |  |    | 192,200    |           
|Gain on asset disposals                  |                                     |    | (1,172,600                       | )          |          |    |          |            |          |   |         |            |  |    | (1,172,600 | )         
|                                         |                                     |    |                                  |            |          |    |           |            |          |   |          |            |  |    |            |           
|                                         |                                     |    | 3,327,400                        |            |          |    | 857,000   |            |          |   | (234,100 | )          |  |    | 3,950,300  |           
|                                         |                                     |    |                                  |            |          |    |           |            |          |   |          |            |  |    |            |           
|                                         | OTHER INCOME (EXPENSE)              |    |                                  | (210,000   | )        |    |           |           |          |   |          |           |  |    |            | (210,000   | )
|                                         |                                     |    |                                  |            |          |    |           |            |          |   |          |            |  |    |            |           
|Net loss                                 |                                     | ($ | 699,400                          | )          |          | ($ | 857,000   | )          |          | $ | 234,100  |            |  | ($ | 1,322,300  | )         
|                                         |                                     |    |                                  |            |          |    |           |            |          |   |          |            |  |    |            |           
|Basic and diluted net loss per share     |                                     | ($ | 0.04                             | )          |          | ($ | 0.04      | )          |          | $ | 0.01     |            |  | ($ | 0.07       | )         
|                                         |                                     |    |                                  |            |          |    |           |            |          |   |          |            |  |    |            |           
|                                         | Weighted average shares outstanding |    |                                  | 18,914,200 |          |    |           | 18,914,200 |          |   |          | 18,914,200 |  |    |            | 18,914,200 |  
|                                         |                                     |    |                                  |            |          |    |           |            |          |   |          |            |  |    |            |           

|                                         |                                     |    |                                |            |          |    |           |            |          |   |          |            |  |    |            |            |  
|---------------------------------------- | ----------------------------------- | -- | ------------------------------ | ---------- | -------- | -- | --------- | ---------- | -------- | - | -------- | ---------- |  | -- | ---------- | ---------- | -
|                                         |                                     |    | Six Months Ended June 30, 2002
|                                         |                                     |    |                               
|                                         |                                     |    | As Previously                  |            | McDonald |    | Briggs    |            | As      
|                                         |                                     |    | Reported                       |            | Property |    | Inventory |            | Restated
|                                         |                                     |    |                                |            |          |    |           |            |         
|                                         | REVENUE                             |    |                                |            |          |    |           |            |          |   |          |            |  |    |            |            |  
|Sales                                    |                                     | $  | 6,880,300                      |            |          | $  |          |            |          | $ |         |            |  | $  | 6,880,300  |           
|                                         |                                     |    |                                |            |          |    |           |            |          |   |          |            |  |    |            |           
|                                         | EXPENSES                            |    |                                |            |          |    |           |            |          |   |          |            |  |    |            |            |  
|Cost of sales                            |                                     |    | 7,353,300                      |            |          |    |          |            |          |   | (160,700 | )          |  |    | 7,192,600  |           
|Depreciation, depletion and amortization |                                     |    | 2,062,700                      |            |          |    | 1,351,200 |            |          |   | (424,200 | )          |  |    | 2,989,700  |           
|Selling, general and administrative      |                                     |    | 740,000                        |            |          |    |          |            |          |   |         |            |  |    | 740,000    |           
|Exploration and development costs        |                                     |    | 20,800                         |            |          |    | 270,900   |            |          |   |         |            |  |    | 291,700    |           
|Gain on asset disposals                  |                                     |    | (1,401,500                     | )          |          |    |          |            |          |   |         |            |  |    | (1,401,500 | )         
|                                         |                                     |    |                                |            |          |    |           |            |          |   |          |            |  |    |            |           
|                                         |                                     |    | 8,775,300                      |            |          |    | 1,622,100 |            |          |   | (584,900 | )          |  |    | 9,812,500  |           
|                                         |                                     |    |                                |            |          |    |           |            |          |   |          |            |  |    |            |           
|                                         | OTHER INCOME (EXPENSE)              |    |                                | (1,181,700 | )        |    |           |           |          |   |          |           |  |    |            | (1,181,700 | )
|                                         |                                     |    |                                |            |          |    |           |            |          |   |          |            |  |    |            |           
|Net loss                                 |                                     | ($ | 3,076,700                      | )          |          | ($ | 1,622,100 | )          |          | $ | 584,900  |            |  | ($ | 4,113,900  | )         
|                                         |                                     |    |                                |            |          |    |           |            |          |   |          |            |  |    |            |           
|Basic and diluted net loss per share     |                                     | ($ | 0.17                           | )          |          | ($ | 0.09      | )          |          | $ | 0.03     |            |  | ($ | 0.23       | )         
|                                         |                                     |    |                                |            |          |    |           |            |          |   |          |            |  |    |            |           
|                                         | Weighted average shares outstanding |    |                                | 17,747,200 |          |    |           | 17,747,200 |          |   |          | 17,747,200 |  |    |            | 17,747,200 |  
|                                         |                                     |    |                                |            |          |    |           |            |          |   |          |            |  |    |            |           

16



---



##### Table of Contents



CANYON RESOURCES CORPORATION
NOTES TO INTERIM CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)



|15. |  | Restatement of Prior Financial Information, continued:
|--- |  | ------------------------------------------------------

CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS

|                                             |                                                                            |                                           |            |                                |            |          |    |           |          |          |   |          |   |   |            |           |            |  
|-------------------------------------------- | -------------------------------------------------------------------------- | ----------------------------------------- | ---------- | ------------------------------ | ---------- | -------- | -- | --------- | -------- | -------- | - | -------- | - | - | ---------- | --------- | ---------- | -
|                                             |                                                                            |                                           |            | Six Months Ended June 30, 2002
|                                             |                                                                            |                                           |            |                               
|                                             |                                                                            |                                           |            | As Previously                  |            | McDonald |    | Briggs    |          | As      
|                                             |                                                                            |                                           |            | Reported                       |            | Property |    | Inventory |          | Restated
|                                             |                                                                            |                                           |            |                                |            |          |    |           |          |         
|Cash flows from operating activities:        |                                                                            |                                           |            |                                |            |          |    |           |          |          |   |          |   |   |            |          
|                                             | Net loss                                                                   |                                           | ($         | 3,076,700                      | )          |          | ($ | 1,622,100 | )        |          | $ | 584,900  |   |   | ($         | 4,113,900 | )         
|                                             | Adjustments to reconcile net loss to net
cash used in operating activities |                                           |            | 956,600                        |            |          |    | 1,351,200 |          |          |   | (584,900 | ) |   |            | 1,722,900 |           
|                                             |                                                                            |                                           |            |                                |            |          |    |           |          |          |   |          |   |   |            |           |           
|                                             |                                                                            | Net cash used in operating activities     |            |                                | (2,120,100 | )        |    |           | (270,900 | )        |   |          |  |   |            |           | (2,391,000 | )
|                                            
|Cash flows from investing activities:        |                                                                            |                                           |            |                                |            |          |    |           |          |          |   |          |   |   |            |          
|                                             |                                                                            | Net cash provided by investing activities |            |                                | 1,517,000  |          |    |           | 270,900  |          |   |          |  |   |            |           | 1,787,900  |  
|                                            
|Cash flows from financing activities:        |                                                                            |                                           |            |                                |            |          |    |           |          |          |   |          |   |   |            |          
|                                             |                                                                            | Net cash used in financing activities     |            |                                | (540,100   | )        |    |           |          |          |   |          |   |   |            |           | (540,100   | )
|                                             |                                                                            |                                           |            |                                |            |          |    |           |          |          |   |          |   |   |            |          
|Net decrease in cash and cash equivalents    |                                                                            |                                           | (1,143,200 | )                              |            |          |    |           |          |          |   |          |   |   | (1,143,200 | )        
|Cash and cash equivalents, beginning of year |                                                                            |                                           | 1,618,100  |                                |            |          |    |           |          |          |   |          |   |   | 1,618,100  |          
|                                             |                                                                            |                                           |            |                                |            |          |    |           |          |          |   |          |   |   |            |          
|Cash and cash equivalents, end of period     |                                                                            | $                                         | 474,900    |                                |            |          |    |           |          |          |   |          |   | $ | 474,900    |          
|                                             |                                                                            |                                           |            |                                |            |          |    |           |          |          |   |          |   |   |            |          



|16. |  | Recently Issued Financial Accounting Standards:
|--- |  | -----------------------------------------------

In April 2003, the Financial Accounting Standards Board issued Statement
of Financial Accounting Standards No. 149, Amendment of Statement 133 on
Derivative Instruments and Hedging Activities(SFAS No. 149). SFAS No. 149
amends and clarifies the accounting for derivative instruments, including
certain derivative instruments embedded in other contracts, and for hedging
activities under SFAS No. 133, Accounting for Derivative Instruments and
Hedging Activities. SFAS No. 149 is generally effective for contracts entered
into or modified after June 30, 2003, and for hedging relationships designated
after June 30, 2003. The adoption of this statement is not expected to have a
material impact on the Companys financial condition or results of operations.

In May 2003, the Financial Accounting Standards Board issued Statement of
Financial Accounting Standards No. 150, Accounting for Certain Financial
Instruments with Characteristics of both Liabilities and Equity(SFAS No. 150).
SFAS No. 150 establishes standards for how an issuer classifies and measures
certain financial instruments with characteristics of both liabilities and
equity. It requires that an issuer classify a financial instrument that is
within its scope as a liability (or an asset in some circumstances). Many of
those instruments were previously classified as equity. The statement is
effective for financial instruments entered into or modified after May 31,
2003. The adoption of SFAS No. 150 did not have any impact on the Companys
financial condition or results of operations.

17



---



##### Table of Contents



CANYON RESOURCES CORPORATION
NOTES TO INTERIM CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)



|17. |  | Subsequent Event:
|--- |  | -----------------

On August 6, 2003, the Company completed an exchange offer (Offer) with
certain holders of outstanding warrants to purchase 1,602,860 shares of the
Companys common stock at a price of $1.67 per share. The Offer allowed, at the
warrant holders option, the opportunity to exchange funds representing a new
exercise price of $1.35 per share and the outstanding warrant in exchange for
shares of common stock and a new warrant with an exercise price of $1.67 per
share that expires on September 30, 2004. Warrants tendered to the Company in
the Offer resulted in aggregate proceeds of $1,916,900 ($835,800 received as of
June 30, 2003) and the Company issuing 1,419,932 shares of its common stock and
new warrants to purchase 1,419,932 shares of its common stock at an exercise
price of $1.67 per share. Warrants not tendered in the Offer representing
182,928 shares are exercisable at $1.67 per share and will expire on September
30, 2003 unless otherwise exercised.

18



---



##### Table of Contents






Item 2. Managements Discussion and Analysis of Financial Condition and Results of Operations

Cautionary Statement for Purposes of the Safe Harbor Provisions of the
Private Securities Litigation Reform Act of 1995.

The matters discussed in this report on Form 10-Q, when not historical
matters, are forward-looking statements that involve a number of risks and
uncertainties that could cause actual results to differ materially from
projected results. Such factors include, among others, the speculative nature
of mineral exploration, commodity prices, production and reserve estimates,
environmental and government regulations, availability of financing, force
majeure events, and other risk factors as described from time to time in the
Companys filings with the Securities and Exchange Commission. Many of these
factors are beyond the Companys ability to control or predict. The Company
disclaims any intent or obligation to update its forward-looking statements,
whether as a result of receiving new information, the occurrence of future
events, or otherwise.

Restatement of Financial Statements

As further discussed in Note 15 to the Consolidated Financial Statements,
the Company has restated its financial statements for the three and six months
ended June 30, 2002. Overall, the adjustments increased the Companys net loss
in the second quarter of 2002 by $622,900, or $0.03 per share. For the six
months ended June 30, 2002, the adjustments increased the Companys net loss by
$1,037,200, or $0.06 per share. The adjustments were i) to expense previously
capitalized costs for the McDonald Gold Project; ii) to commence amortizing the
carrying values of the McDonald and Seven-Up Pete mineral property interests
upon adoption on January 1, 2002 of Statement of Financial Accounting Standards
No. 142, Goodwill and Other Intangible Assets; and iii) to include
depreciation, depletion and amortization as a cost in inventories at the
Companys Briggs Mine. Prior period amounts in the ensuing discussion have been
adjusted for these restatements where applicable. See also Note 19 to the
Companys Consolidated Financial Statements included in its 2002 Form 10-K
filing for further discussion of the restatements.

Results of Operations

The Company recorded a net loss of $2.9 million, or $0.14 per share, on
revenues of $3.4 million for the second quarter of 2003. For the six months
ended June 30, 2003, the Company recorded a net loss of $4.8 million, or $0.23
per share, on revenues of $7.2 million. This compares to a net loss of $1.3
million, or $0.07 per share, on revenues of $2.8 million for the second quarter
of 2002 and a net loss of $4.1 million, or $0.23 per share, on revenues of $6.9
million during the first six months of 2002.

For the three months ended June 30, 2003, the Company sold 9,681 ounces of
gold and 4,043 ounces of silver at an average realized price of $350 per
equivalent gold ounce. For the comparable period of 2002, the Company sold
8,900 ounces of gold and 3,500 ounces of silver at an average realized price of
$319 per equivalent gold ounce. The New York Commodity Exchange (COMEX) gold
price averaged $347 and $313 per ounce for the three months ended June 30, 2003
and 2002, respectively.

The following table summarizes the Companys gold deliveries and revenues
for the three months ended June 30, 2003 and the comparable period for 2002:

19



---



##### Table of Contents



|                   |                             |  |                    |       |                    |   |         |     |        |   |           |       |         |  |       |       |         |   |     |     |  |   |       |       |  
|------------------ | --------------------------- |  | ------------------ | ----- | ------------------ | - | ------- | --- | ------ | - | --------- | ----- | ------- |  | ----- | ----- | ------- | - | --- | --- |  | - | ----- | ----- | -
|                   |                             |  | THREE MONTHS ENDED |       | THREE MONTHS ENDED
|                   |                             |  | JUNE 30, 2003      |       | JUNE 30, 2002     
|                   |                             |  |                    |       |                   
|                   |                             |  |                    |       |                    |   | Average |     |        |   |           |       |         |  |       |       | Average |   |     |     | 
|                   |                             |  | Gold               |       | Price Per          |   | Revenue |     | Gold   |   | Price Per |       | Revenue
|                   |                             |  | Ounces             |       | Oz.                |   | $000s   |     | Ounces |   | Oz.       |       | $000s  
|                   |                             |  |                    |       |                    |   |         |     |        |   |           |       |        
|Deliveries         |                            
|                   | Forwards                    |  |                    | 2,750 |                    |   | $       | 364 |        |   | $         | 1,001 |         |  |       | 3,900 |         |   | $   | 268 |  |   | $     | 1,045 |  
|                   | Spot Sales                  |  |                    | 6,931 |                    |   | $       | 342 |        |   |           | 2,367 |         |  |       | 5,000 |         |   | $   | 315 |  |   |       | 1,575 |  
|                   | Cash settlement of forwards |  |                    |      |                    |   |         |    |        |   |           |      |         |  |       |      |         |   |     |    |  |   |       | (115  | )
|                   | Deferred income             |  |                    |      |                    |   |         |    |        |   |           |      |         |  |       |      |         |   |     |    |  |   |       | 316   |  
|                   |                             |  |                    |       |                    |   |         |     |        |   |           |       |         |  |       |       |         |   |     |     |  |   |       |      
|                   |                             |  | 9,681              |       |                    | $ | 348     |     |        |   | 3,368     |       |         |  | 8,900 |       |         | $ | 317 |     |  |   | 2,821 |      
|Other transactions |                            
|                   | Silver proceeds             |  |                    |      |                    |   |         |    |        |   |           | 19    |         |  |       |      |         |   |     |    |  |   |       | 17    |  
|                   |                             |  |                    |       |                    |   |         |     |        |   |           |       |         |  |       |       |         |   |     |     |  |   |       |      
|                   |                             |  | 9,681              |       |                    | $ | 350     |     |        | $ | 3,387     |       |         |  | 8,900 |       |         | $ | 319 |     |  | $ | 2,838 |      

For the six months ended June 30, 2003, the Company sold 22,231 ounces of
gold and 8,343 ounces of silver at an average realized price of $326 per
equivalent gold ounce. For the comparable period of 2002, the Company sold
22,238 ounces of gold and 9,054 ounces of silver at an average realized price
of $309 per equivalent gold ounce. The New York Commodity Exchange (COMEX)
gold price averaged $350 and $302 per ounce for the six months ended June 30,
2003 and 2002, respectively.

The following table summarizes the Companys gold deliveries and revenues
for the six months ended June 30, 2003 and the comparable period for 2002:

|                   |                             |  |                  |        |                  |   |         |     |        |   |           |       |         |  |        |        |         |   |     |     |  |   |       |       |  
|------------------ | --------------------------- |  | ---------------- | ------ | ---------------- | - | ------- | --- | ------ | - | --------- | ----- | ------- |  | ------ | ------ | ------- | - | --- | --- |  | - | ----- | ----- | -
|                   |                             |  | SIX MONTHS ENDED |        | SIX MONTHS ENDED
|                   |                             |  | JUNE 30, 2003    |        | JUNE 30, 2002   
|                   |                             |  |                  |        |                 
|                   |                             |  |                  |        |                  |   | Average |     |        |   |           |       |         |  |        |        | Average |   |     |     | 
|                   |                             |  | Gold             |        | Price Per        |   | Revenue |     | Gold   |   | Price Per |       | Revenue
|                   |                             |  | Ounces           |        | Oz.              |   | $000s   |     | Ounces |   | Oz.       |       | $000s  
|                   |                             |  |                  |        |                  |   |         |     |        |   |           |       |        
|Deliveries         |                            
|                   | Forwards                    |  |                  | 6,950  |                  |   | $       | 307 |        |   | $         | 2,134 |         |  |        | 9,900  |         |   | $   | 268 |  |   | $     | 2,655 |  
|                   | Spot Sales                  |  |                  | 15,281 |                  |   | $       | 344 |        |   |           | 5,250 |         |  |        | 12,338 |         |   | $   | 301 |  |   |       | 3,708 |  
|                   | Cash settlement of forwards |  |                  |       |                  |   |         |    |        |   |           | (173  | )       |  |        |       |         |   |     |    |  |   |       | (157  | )
|                   | Deferred income             |  |                  |       |                  |   |         |    |        |   |           |      |         |  |        |       |         |   |     |    |  |   |       | 632   |  
|                   |                             |  |                  |        |                  |   |         |     |        |   |           |       |         |  |        |        |         |   |     |     |  |   |       |      
|                   |                             |  | 22,231           |        |                  | $ | 325     |     |        |   | 7,221     |       |         |  | 22,238 |        |         | $ | 307 |     |  |   | 6,838 |      
|Other transactions |                            
|                   | Silver proceeds             |  |                  |       |                  |   |         |    |        |   |           | 39    |         |  |        |       |         |   |     |    |  |   |       | 42    |  
|                   |                             |  |                  |        |                  |   |         |     |        |   |           |       |         |  |        |        |         |   |     |     |  |   |       |      
|                   |                             |  | 22,231           |        |                  | $ | 326     |     |        | $ | 7,250     |       |         |  | 22,238 |        |         | $ | 309 |     |  | $ | 6,880 |      

Cost of sales was $4.2 million for the three months ended June 30, 2003,
as compared to $3.2 million in the prior period. For the six months ended June
30, 2003, cost of sales was $7.8 million as compared to $7.2 million in the
prior period. For the three and six months ended June 30, 2003, cost of sales
includes write downs of inventory to net realizable value of $1.2 million and
$1.7 million, respectively.

Depreciation, depletion and amortization was higher in the current period
due to a greater number of recoverable ounces mined. During the first six
months of 2002, high strip ratios in the last remaining benches of the North
Briggs deposit and pre-stripping requirements at the Goldtooth deposit resulted
in significantly lower ore tons and ounces of gold placed on the leach pad for
processing and recovery.

20



---



##### Table of Contents



Selling, general and administrative expense was not materially different
for the second quarter and was approximately $0.1 million higher in the current
year to date period due to higher legal and other professional services.

Exploration and development costs were not materially different for the
second quarter and were approximately $0.1 million higher in the current year
to date period due to higher costs at the Companys McDonald Gold Project.

Interest income and expense were not materially different for the periods
presented.

During the second quarter of 2002, the Company recognized a gain of
approximately $1.2 million in connection with the sale of its crushing
equipment at the Briggs Mine. The Company also recognized gains of
approximately $0.076 million and $0.229 million in connection with the sale of
certain property interests during the six months ended June 30, 2003 and 2002,
respectively.

The Company recorded unrealized gains on its forward gold contracts of
approximately $0.1 million and $0.6 million for the three and six months ended
June 30, 2003 and unrealized losses of $0.1 million and $1.1 million for the
comparable periods in 2002. These amounts are shown as a separate line item in
the other income (expense) section on the Statement of Operations.

On January 1, 2003, the Company became subject to the accounting and
reporting requirements of Statement of Financial Accounting Standards No. 143,
Accounting for Asset Retirement Obligations(SFAS No. 143). SFAS No. 143
establishes accounting and reporting standards for obligations associated with
the retirement of tangible long-lived assets and the associated asset
retirement costs. SFAS No. 143 requires that the fair value of a liability for
an asset retirement obligation be recognized in the period in which it is
incurred if a reasonable estimate of fair value can be made. Fair value is
determined by estimating the retirement obligations in the period an asset is
first placed in service and then adjusting the amount for estimated inflation
and market risk contingencies to the projected settlement date of the
liability. The result is then discounted to a present value from the projected
settlement date to the date the asset was first placed in service. The present
value of the asset retirement obligation is recorded as an additional property
cost and as an asset retirement liability. The amortization of the additional
property cost (using the units of production method) is included in
depreciation, depletion and amortization expense and the accretion of the
discounted liability is recorded as a separate operating expense in the
Companys Statement of Operations. Prior to adoption of SFAS No. 143, an
accrual for the Companys estimated asset retirement obligations (site specific
reclamation costs for earthwork, revegetation, water treatment and
dismantlement of facilities) was made using the units of production method over
the life of the property and was included in cost of sales. Upon adoption of
SFAS No. 143, the Company recorded a loss of $11,700 as the cumulative effect
of a change in accounting principle. See Note 4 to the Consolidated Financial
Statements for further disclosures regarding the Companys adoption of SFAS No.
143.

Liquidity & Capital Resources

For the six months ended June 30, 2003, operating activities used $1.0
million of cash, investing activities used $0.2 million of cash and financing
activities provided $2.4 million of cash resulting in a net increase in cash of
$1.2 million. Cash and cash equivalents at June 30, 2003 was $1.6 million.

During the first half of 2003, proceeds of approximately $0.2 million were
realized in connection with the sale of certain property interests.

During the first half of 2003, the Company raised approximately $3.3
million through a private placement of 6% convertible debentures, paid down
debt by approximately $1.6 million, (which included the final payoff of the
Briggs Mine loan facility) and made capital lease payments of approximately
$0.1 million. In addition, in late June 2003, the Company received
approximately $0.8 million in connection with an offer to exchange certain
outstanding warrants for cash and issuance of new warrants. On August 6, 2003,
the exchange offer was completed with a total of approximately $1.9 million
raised. See Note 17 to the Consolidated Financial Statements for further
information on this transaction.

21



---



##### Table of Contents



The Company believes that its cash requirements over the next 12 months
can be funded through a combination of existing cash, cash flow from operations
and cash raised from the aforementioned warrant exchange. The Companys
long-term liquidity may be impacted by the scheduled wind down of operations at
the Briggs Mine during 2004-2005, which is currently the only internal source
of cash flow. The Company is continually evaluating business opportunities such
as joint ventures and mergers and acquisitions with the objective of creating
additional cash flow to sustain the corporation, provide a future source of
funds for growth, as well as to continue its litigation efforts with respect to
the McDonald Gold Project. While the Company believes it will be able to
finance its continuing activities, including the McDonald litigation, there are
no assurances of success in this regard or in the Companys ability to secure
additional financing through capital markets, joint ventures, or other
arrangements in the future.

Other Matters

McDonald Gold Project  Anti-Cyanide Initiative

In November 1998, the Montana electorate passed an anti-mining initiative
(I-137) by a vote of 52% to 48%. I-137, as modified by the State Legislature in
April 1999, bans development of new gold and silver mines, which use open-pit
mining methods and cyanide in the treatment and recovery process. In April
2000, the SPV filed lawsuits in Montana State District Court and in the United
States District Court, seeking to have I-137 declared unconstitutional, or,
alternatively, to obtain a takings or damage award for the lost value of the
McDonald, Seven-Up Pete and Keep Cool mineral properties. These lawsuits are
based on, amongst others, (i) the right not to be deprived of property without
due process of law; (ii) the right to equal protection under the laws; and
(iii) the right to be protected against laws which impair the obligations of
existing contracts. The United States District Court issued a ruling August 30,
2001 in which the Court dismissed the SPVs substantive due process claim but,
as requested by the SPV, ruled that the remainder of the SPVs claims could be
pursued at such time as the State lawsuit was concluded. The Montana State
District Court issued a ruling November 1, 2001 in response to a Motion to
Dismiss and a Motion For Summary Judgment by the State of Montana. In this
ruling, the Court dismissed four of the SPVs fourteen counts, including its
substantive due process and equal protection challenges to I-137s validity.
The decision maintained for adjudication the contract impairment validity
challenge, contract damage claims, and all of the takings claims. Following the
November 2001 ruling by the State District Court, the State filed a new Motion
for Summary Judgment as to all claims. In an Order dated December 9, 2002, the
Court granted the State Summary Judgment on all of the remaining legal claims
of the Companys lawsuit. On January 14, 2003, the Company filed an appeal with
the Montana State Supreme Court of the State District Court Order.

McDonald Gold Project  State Leases

On September 24, 1998, the Montana Department of Natural Resources (DNRC),
the entity that administers state mineral leases, unilaterally decided to
cancel the permitting extension of the 10-year lease term of the state leases
that pertain to the McDonald Gold Project which would require the Company,
after a period of approximately seventeen months, to commence paying a delay
rental of $150,000 per month in order to maintain the leases. In February
2000, pursuant to its September 1998 decision, the DNRC determined that the
primary terms of the mineral leases had expired. The Company appealed the
action of the DNRC in an administrative hearing process and the DNRC Hearing
Examiner affirmed the DNRC action. It is the Companys position that the
permitting process has been interrupted by the threat and passage of I-137 and,
thus, the permit extension is continued until the governmental impediment is
resolved. As part of the I-137 lawsuit filed in April 2000 against the State of
Montana, the Company asked the court to review and invalidate the DNRCs
action, however, the court, in its December 9, 2002 order as described in the
preceding paragraph, denied the Companys petition for judicial review. On
January 14, 2003, the Company filed an appeal with the Montana Supreme Court.

22



---



##### Table of Contents



Briggs Mine  Surety Matters

The Briggs Mine operates under permits granted by various agencies
including the U.S. Bureau of Land Management (BLM), Inyo County, the California
Department of Conservation, and the Lahontan Regional Water Quality Control
Board (Lahontan). These agencies have jointly required the Company to post a
reclamation bond in the amount of $3,030,000 to ensure appropriate reclamation.
Additionally, the Company was required by Lahontan to post a $1,010,000 bond to
ensure adequate funds to mitigate any foreseeable release, as defined, of
pollutants to state waters. Both bonds are subject to annual review and
adjustment.

In 2000, in response to a demand for an increase in collateral by the
Surety who issued the above described bonds, the Company granted a security
interest in 28,000 acres of mineral interests in Montana. In addition, the
Company agreed to make cash deposits with the Surety totaling $1.5 million over
a three year period at the rate of $0.5 million per year, commencing June 30,
2001. The Company has not made any deposits to date, and is in discussions with
the Surety to reschedule the deposit requirements. If an acceptable
rescheduling of the deposit requirements cannot be agreed to, the Surety could
seek to terminate the bonds which could result in the Company becoming liable
for the principal amounts under its collateral agreement with the Surety.

Kendall Mine - Environmental Regulation

The Kendall Mine operates under permits granted by the Montana Department
of Environmental Quality (DEQ). In February 2002, the DEQ issued a decision
that a comprehensive Environmental Impact Statement (EIS) is needed for
completion of remaining reclamation at Kendall. The Company feels that it is
crucial that reclamation proceed at Kendall without further delay and,
therefore, disagrees with the agency decision, and is presently evaluating its
course of action with regard to the DEQs decision. The Companys estimate to
achieve mine closure could be impacted by the outcome of an agency decision
following an EIS. The Company has $1,906,000 on deposit in an interest bearing
account with the DEQ for reclamation at the Kendall Mine.

Kendall Mine - Legal Matters

In October 2001, a Plaintiff group filed suit in Montana District Court
against the Company and its wholly-owned subsidiary, CR Kendall Corporation,
alleging violation of water rights and other torts in connection with the
operation of the Kendall Mine. The Complaint seeks unspecified damages and
punitive damages. The Company believes the allegations are completely without
merit and that the Company will prevail in this matter.

In August 2002, a Preliminary Injunction was issued in Montana District
Court on behalf of the Plaintiff group in connection with the Companys auction
of certain mineral rights and fee lands in western Montana. In October 2002,
the Court issued a Supplemental Order which will sequester up to $528,000 of
any proceeds realized from the auction until such time as the lawsuit is
concluded. As of June 30, 2003, $247,100 had been remitted to the Court as
required by the Order. The Company has filed an appeal to this Order with the
Montana State Supreme Court.

Recently Issued Financial Accounting Standards

In April 2003, the Financial Accounting Standards Board issued Statement
of Financial Accounting Standards No. 149, Amendment of Statement 133 on
Derivative Instruments and Hedging Activities(SFAS No. 149). SFAS No. 149
amends and clarifies the accounting for derivative instruments, including
certain derivative instruments embedded in other contracts, and for hedging
activities under SFAS No. 133, Accounting for Derivative Instruments and
Hedging Activities. SFAS No. 149 is generally effective for contracts entered
into or modified after June 30, 2003, and for hedging relationships designated
after June 30, 2003. The adoption of this statement is not expected to have a
material impact on the Companys financial condition or results of operations.

23



---



##### Table of Contents



In May 2003, the Financial Accounting Standards Board issued Statement of
Financial Accounting Standards No. 150, Accounting for Certain Financial
Instruments with Characteristics of both Liabilities and Equity(SFAS No. 150).
SFAS No. 150 establishes standards for how an issuer classifies and measures
certain financial instruments with characteristics of both liabilities and
equity. It requires that an issuer classify a financial instrument that is
within its scope as a liability (or an asset in some circumstances). Many of
those instruments were previously classified as equity. The statement is
effective for financial instruments entered into or modified after May 31,
2003. The adoption of SFAS No. 150 did not have any impact on the Companys
financial condition or results of operations.




Item 3. Quantitative and Qualitative Disclosures About Market Risk

Commodity Prices

The Companys earnings and cash flow are significantly impacted by changes
in the market price of gold. Gold prices can fluctuate widely and are affected
by numerous factors, such as demand, production levels, economic policies of
central banks, producer hedging, and the strength of the U.S. dollar relative
to other currencies. During the last five years, the average annual market
price has fluctuated between $271 per ounce and $331 per ounce.

At June 30, 2003, the Company had an outstanding forward contract on 7,250
ounces of gold at an average price of approximately $364 per ounce,
approximately 17% of anticipated production over the next twelve months. At
current production levels, a $10 per ounce change in the price of gold will
impact the Companys annual profitability and cash flow by approximately $0.3
million.

There are certain market risks associated with the forward contracts
utilized by the Company. If the Companys counterparties fail to honor their
contractual obligation to purchase gold at agreed-upon prices, the Company may
be exposed to market price risk by having to sell gold in the open market at
prevailing prices. Similarly, if the Company fails to produce sufficient
quantities of gold to meet its forward commitments, the Company would have to
purchase the shortfall in the open market at prevailing prices. In addition,
the Company could be subject to cash margin calls by counterparties if the
market price of gold significantly exceeds the forward contract price which
would create additional financial obligations.

At June 30, 2003, the fair value of the Companys forward gold contract
was approximately $0.1 million higher than the contractual amount.

Interest Rates

At June 30, 2003, the Companys debt was approximately $4.6 million of
which $3.3 million relates to its 6% convertible debentures and $1.3 million
relates to a fixed rate (6.75%) financing of a lease buy-out of the mining
fleet at the Briggs Mine. Thus, the Company is not presently subject to
interest rate risk.

Foreign Currency

The price of gold is denominated in U.S. dollars, and the Companys gold
production operations are in the United States. The Company conducts only a
minor amount of exploration activity in foreign countries and has minimal
foreign currency exposure.

24



---



##### Table of Contents






Item 4. Controls and Procedures

Evaluation of Disclosure Controls and Procedures

The Company maintains a system of disclosure controls and procedures. The
term disclosure controls and procedures, as defined by regulations of the
Securities and Exchange Commission (SEC), means controls and other procedures
that are designed to ensure that information required to be disclosed in the
reports that the Company files or submits to the SEC under the Securities
Exchange Act of 1934, as amended (the Act), is recorded, processed,
summarized and reported, within the time periods specified in the SECs rules
and forms. Disclosure controls and procedures include, without limitation,
controls and procedures designed to ensure that information required to be
disclosed by the Company in the reports that it files or submits to the SEC
under the Act is accumulated and communicated to the Companys management,
including its principal executive officer and its principal financial officer,
as appropriate to allow timely decisions to be made regarding required
disclosure. The Companys Chief Executive Officer and Chief Financial Officer
have evaluated the Companys disclosure controls and procedures as of the end
of the period covering by this Quarterly Report on Form 10-Q and have concluded
that the Companys disclosure controls and procedures are effective as of the
date of such evaluation.

Changes in Internal Controls

The Company also maintains a system of internal controls. The term
internal controls, as defined by the American Institute of Certified Public
Accountants Codification of Statement on Auditing Standards, AU Section 319,
means controls and other procedures designed to provide reasonable assurance
regarding the achievement of objectives in the reliability of the Companys
financial reporting, the effectiveness and efficiency of the Companys
operations and the Companys compliance with applicable laws and regulations.
There have been no significant changes in the Companys internal controls or in
other factors that could significantly affect such controls subsequent to the
date the Company carried out its evaluation.

25



---



##### Table of Contents






PART II OTHER INFORMATION




|                          |  |                    
|------------------------- |  | -------------------
|Item 1. Legal Proceedings |  | No reportable event




Item 2. Changes in Securities



| |  | In June 2003, the Company issued 27,900 unregistered shares of its
$0.01 par value common stock as compensation for services to a single
sophisticated employee, John C. Doody. The shares were issued pursuant
to the exemption provided by Section 4(2) of the Securities and
Exchange Act of 1933, as amended.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
| |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|
| |  | On August 6, 2003, the Company completed an exchange offer (Offer)
with certain holders of outstanding warrants to purchase 1,602,860
shares of the Companys common stock at a price of $1.67 per share. The
Offer allowed, at the warrant holders option, the opportunity to
exchange funds representing a new exercise price of $1.35 per share and
the outstanding warrant in exchange for shares of common stock and a
new warrant with an exercise price of $1.67 per share that expires on
September 30, 2004. Warrants tendered to the Company in the Offer
resulted in proceeds of $1,916,900 and the Company issuing 1,419,932
shares of its common stock and new warrants to purchase 1,419,932
shares of its common stock at an exercise price of $1.67 per share.
Warrants not tendered in the Offer representing 182,928 shares are
exercisable at $1.67 per share and will expire on September 30, 2003
unless otherwise exercised. Common shares issued in connection with the
Offer were covered by the Companys registration statement on Form S-3
(Registration No. 333-89412). The new warrants issued in connection
with the Offer were issued to twenty-four accredited investors under
the exemption provided under Rule 506 of Regulation D.




|                                        |  |     
|--------------------------------------- |  | ----
|Item 3. Defaults Upon Senior Securities |  | None




Item 4. Submission of Matters to Vote of Security Holders



| |  | On June 12, 2003, the Company held its Annual Meeting of Shareholders.
The following item of business was voted upon by shareholders at the
meeting.                                                                                                                                                
| |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|
| |  | Proposal I was the election of two Directors of the Company, Leland O.
Erdahl and Gary C. Huber. The proposal electing Mr. Erdahl passed with
votes of 15,103,325 shares For and 358,141 Withheld. The proposal
electing Mr. Huber passed with votes of 15,103,386 For and 358,080
Withheld.
|
| |  | The following individuals continued in their capacity as Directors of
the Company subsequent to the Annual Meeting of Shareholders: Richard
H. De Voto, David K. Fagin, Richard F. Mauro, and Ronald D. Parker.                                                                                     




|                          |  |     
|------------------------- |  | ----
|Item 5. Other Information |  | None




Item 6(a) Exhibits



| |  | Exhibits, as required by Item 601 of Regulation S-K, are listed on
pages 27  28. The exhibit numbers correspond to the numbers assigned
in Item 601 of Regulation S-K.
| |  | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------

|                              |  |     
|----------------------------- |  | ----
|Item 6(b) Reports on Form 8-K |  | None

26



---



##### Table of Contents



|        |  |                                                                                                                                                                                                                                                                          
|------- |  | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|EXHIBIT |  |                                                                                                                                                                                                                                                                          
|NUMBER  |  | DESCRIPTION                                                                                                                                                                                                                                                              
|        |  |                                                                                                                                                                                                                                                                          
|3.1     |  | Articles of Incorporation of the Company, as amended (1)                                                                                                                                                                                                                 
|        |  |                                                                                                                                                                                                                                                                          
|3.1.1   |  | Executed Certificate of Designations, dated December 26, 1990, as
filed with the Delaware Secretary of State on December 26, 1990 (2)                                                                                                                                    
|        |  |                                                                                                                                                                                                                                                                          
|3.2     |  | Bylaws of the Company, as amended (3)                                                                                                                                                                                                                                    
|        |  |                                                                                                                                                                                                                                                                          
|4.1     |  | Specimen Common Stock Certificate (4)                                                                                                                                                                                                                                    
|        |  |                                                                                                                                                                                                                                                                          
|4.2     |  | Specimen Warrant Certificate (5)                                                                                                                                                                                                                                         
|        |  |                                                                                                                                                                                                                                                                          
|4.4     |  | Rights Agreement dated March 20, 1997, between Canyon Resources
Corporation and American Securities Transfer & Trust, Inc. (6)                                                                                                                                           
|        |  |                                                                                                                                                                                                                                                                          
|4.5     |  | Specimen Debenture (7)                                                                                                                                                                                                                                                   
|        |  |                                                                                                                                                                                                                                                                          
|10.1    |  | Change of Control Agreements, dated December 6, 1991, between the
Company and Richard H. De Voto and Gary C. Huber (8)                                                                                                                                                   
|        |  |                                                                                                                                                                                                                                                                          
|10.2    |  | Loan Agreement dated December 6, 1995, among CR Briggs Corporation as
Borrower and Banque Paribas as Agent (9)                                                                                                                                                           
|        |  |                                                                                                                                                                                                                                                                          
|10.2.1  |  | Amendment No. 1 to Loan and Guarantee Agreements dated April 8, 1998,
among CR Briggs Corporation, Canyon Resources Corporation, and Banque
Paribas as Agent (10)                                                                                                        
|        |  |                                                                                                                                                                                                                                                                          
|10.2.2  |  | Amendment No. 2 to Loan and Guarantee Agreements dated August 19,
1998, among CR Briggs Corporation, Canyon Resources Corporation, and
Banque Paribas as Agent (10)                                                                                                      
|        |  |                                                                                                                                                                                                                                                                          
|10.2.3  |  | Amendment No. 3 to Loan Agreement and Waiver dated July 8, 1999, among
CR Briggs Corporation and Banque Paribas as Agent (11)                                                                                                                                            
|        |  |                                                                                                                                                                                                                                                                          
|10.2.4  |  | Amendment No. 4 to Loan Agreement and Waiver dated March 26, 2001,
among CR Briggs Corporation and BNP Paribas, as successor-in-interest to
Banque Paribas as Agent (12)                                                                                                 
|        |  |                                                                                                                                                                                                                                                                          
|10.2.5  |  | Amendment No. 5 to Loan Agreement and Waiver dated March 25, 2002,
among CR Briggs Corporation, Canyon Resources Corporation, and Banque
Paribas, as Agent (13)                                                                                                          
|        |  |                                                                                                                                                                                                                                                                          
|10.2.6  |  | Amendment No. 6 to Loan Agreement and Waiver dated June 14, 2002,
among CR Briggs Corporation and BNP Paribas, as successor-in-interest to
Banque Paribas as Agent (14)                                                                                                  
|        |  |                                                                                                                                                                                                                                                                          
|10.3    |  | Master Tax Lease dated December 27, 1995, between CR Briggs
Corporation and Caterpillar Financial Services Corporation (9)                                                                                                                                               
|        |  |                                                                                                                                                                                                                                                                          
|10.4    |  | Purchase Agreement dated September 25, 1997, between Phelps Dodge
Corporation, acting through its division, Phelps Dodge Mining Company,
and CR Montana Corporation and Canyon Resources Corporation (15)                                                                
|        |  |                                                                                                                                                                                                                                                                          
|10.4.1  |  | Second Amendment and Supplement to Purchase Agreement dated September
17, 1999, between Phelps Dodge Corporation, acting through its division,
Phelps Dodge Mining Company, CR Montana Corporation and Canyon Resources
Corporation, and Seven-Up Pete Joint Venture (11)
|        |  |                                                                                                                                                                                                                                                                          
|10.5    |  | Assignment of Royalty Proceeds, effective as of April 1, 2001,
between Canyon Resources Corporation and Franco-Nevada Mining
Corporation, Inc. (16)                                                                                                                      
|        |  |                                                                                                                                                                                                                                                                          
|31.1*   |  | Certification of Chief Executive Officer pursuant to Rule
13(a)-14(a)/15d-14(a), as adopted pursuant to Section 302 of the
Sarbanes-Oxley Act of 2002                                                                                                                    
|        |  |                                                                                                                                                                                                                                                                          
|31.2*   |  | Certification of Chief Financial Officer pursuant to Rule
13(a)-14(a)/15d-14(a), as adopted pursuant to Section 302 of the
Sarbanes-Oxley Act of 2002                                                                                                                    
|        |  |                                                                                                                                                                                                                                                                          
|32.1*   |  | Certification of Chief Executive Officer pursuant to U.S.C. Section
1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of
2002                                                                                                                           
|        |  |                                                                                                                                                                                                                                                                          
|32.2*   |  | Certification of Chief Financial Officer pursuant to U.S.C. Section
1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of
2002                                                                                                                           



| |  | * Filed herewith
| |  | ----------------

27



---



##### Table of Contents



|     |  |                                                                                                                                                                                       
|---- |  | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(1)  |  | Exhibit 3.1 is incorporated by reference from Exhibit 3.1(a) to the
Companys Amended Annual Report on Form 10-K/A for the fiscal year ended
December 31, 2000.                       
|     |  |                                                                                                                                                                                       
|(2)  |  | Exhibit 3.1.1 is incorporated by reference from Exhibit 4 of the
Companys Report on Form 8-K filed with the Securities and Exchange
Commission on December 26, 1990.                 
|     |  |                                                                                                                                                                                       
|(3)  |  | Exhibit 3.2 is incorporated by reference from Exhibit 3.2 of the
Companys Annual Report on Form 10-K for the fiscal year ended December
31, 1997.                                    
|     |  |                                                                                                                                                                                       
|(4)  |  | Exhibit 4.1 is incorporated by reference from the Companys
Registration Statement on Form 8-A as declared effective by the
Securities and Exchange Commission on March 18, 1986.     
|     |  |                                                                                                                                                                                       
|(5)  |  | Exhibit 4.2 is incorporated by reference from Exhibit 4.2 of the
Companys Quarterly Report on Form 10-Q for the three months ended March
31, 2002.                                   
|     |  |                                                                                                                                                                                       
|(6)  |  | Exhibit 4.4 is incorporated by reference from Exhibit 4 of the
Companys Report on Form 8-K filed with the Securities and Exchange
Commission on March 27, 1997.                      
|     |  |                                                                                                                                                                                       
|(7)  |  | Exhibit 4.5 is incorporated by reference from Exhibit 4.5 of the
Companys Annual Report on Form 10-K for the fiscal year ended December
31, 2002.                                    
|     |  |                                                                                                                                                                                       
|(8)  |  | Exhibit 10.1 is incorporated by reference from Exhibit 10.20 of the
Companys Annual Report on Form 10-K for the fiscal year ended December
31, 1992.                                 
|     |  |                                                                                                                                                                                       
|(9)  |  | Exhibits 10.2 and 10.3 are incorporated by reference from Exhibits
4.9, 4.10, 10.22 and 10.23 of the Companys Annual Report on Form 10-K
for the fiscal year ended December 31, 1995.
|     |  |                                                                                                                                                                                       
|(10) |  | Exhibits 10.2.1 and 10.2.2 are incorporated by reference from
Exhibits 10.2.1 and 10.2.2 of the Companys Annual Report on Form 10-K
for the fiscal year ended December 31, 1998.     
|     |  |                                                                                                                                                                                       
|(11) |  | Exhibits 10.2.3 and 10.4.1 are incorporated by reference from
Exhibits 10.2.3 and 10.4.1 of the Companys Annual Report on Form 10-K
for the fiscal year ended December 31, 1999.     
|     |  |                                                                                                                                                                                       
|(12) |  | Exhibit 10.2.4 is incorporated by reference from Exhibit 10.2.4 of
the Companys Annual Report on Form 10-K for the fiscal year ended
December 31, 2000.                              
|     |  |                                                                                                                                                                                       
|(13) |  | Exhibit 10.2.5 is incorporated by reference from Exhibit 10.2.5 of
the Companys Annual Report on Form 10-K for the fiscal year ended
December 31, 2001.                              
|     |  |                                                                                                                                                                                       
|(14) |  | Exhibit 10.2.6 is incorporated by reference from Exhibit 10.2.6 of
the Companys Quarterly Report on Form 10-Q for the period ended June
30, 2002.                                    
|     |  |                                                                                                                                                                                       
|(15) |  | Exhibit 10.4 is incorporated by reference from Exhibit 2 of the
Companys Report on Form 8-K filed with the Securities and Exchange
Commission on October 9, 1997.                    
|     |  |                                                                                                                                                                                       
|(16) |  | Exhibit 10.5 is incorporated by reference from Exhibit 1.1 of the
Companys Report on Form 8-K filed with the Securities and Exchange
Commission on October 9, 2001.                  

28



---



##### Table of Contents






SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.

|                      |  |                             
|--------------------- |  | ----------------------------
|                      |  | CANYON RESOURCES CORPORATION
|                      |  |                             
|Date: August 14, 2003 |  | /s/ Richard H. De Voto      
|                      |  | Richard H. De Voto          
|                      |  | Chief Executive Officer     
|                      |  |                             
|Date: August 14, 2003 |  | /s/ Gary C. Huber           
|                      |  | Gary C. Huber               
|                      |  | Chief Financial Officer     

29



---



##### Table of Contents






EXHIBIT INDEX

|        |  |                                                                                                                                                                                                                                                                          
|------- |  | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|EXHIBIT |  |                                                                                                                                                                                                                                                                          
|NUMBER  |  | DESCRIPTION                                                                                                                                                                                                                                                              
|        |  |                                                                                                                                                                                                                                                                          
|3.1     |  | Articles of Incorporation of the Company, as amended (1)                                                                                                                                                                                                                 
|        |  |                                                                                                                                                                                                                                                                          
|3.1.1   |  | Executed Certificate of Designations, dated December 26, 1990, as
filed with the Delaware Secretary of State on December 26, 1990 (2)                                                                                                                                    
|        |  |                                                                                                                                                                                                                                                                          
|3.2     |  | Bylaws of the Company, as amended (3)                                                                                                                                                                                                                                    
|        |  |                                                                                                                                                                                                                                                                          
|4.1     |  | Specimen Common Stock Certificate (4)                                                                                                                                                                                                                                    
|        |  |                                                                                                                                                                                                                                                                          
|4.2     |  | Specimen Warrant Certificate (5)                                                                                                                                                                                                                                         
|        |  |                                                                                                                                                                                                                                                                          
|4.4     |  | Rights Agreement dated March 20, 1997, between Canyon Resources
Corporation and American Securities Transfer & Trust, Inc. (6)                                                                                                                                           
|        |  |                                                                                                                                                                                                                                                                          
|4.5     |  | Specimen Debenture (7)                                                                                                                                                                                                                                                   
|        |  |                                                                                                                                                                                                                                                                          
|10.1    |  | Change of Control Agreements, dated December 6, 1991, between the
Company and Richard H. De Voto and Gary C. Huber (8)                                                                                                                                                   
|        |  |                                                                                                                                                                                                                                                                          
|10.2    |  | Loan Agreement dated December 6, 1995, among CR Briggs Corporation as
Borrower and Banque Paribas as Agent (9)                                                                                                                                                           
|        |  |                                                                                                                                                                                                                                                                          
|10.2.1  |  | Amendment No. 1 to Loan and Guarantee Agreements dated April 8, 1998,
among CR Briggs Corporation, Canyon Resources Corporation, and Banque
Paribas as Agent (10)                                                                                                        
|        |  |                                                                                                                                                                                                                                                                          
|10.2.2  |  | Amendment No. 2 to Loan and Guarantee Agreements dated August 19,
1998, among CR Briggs Corporation, Canyon Resources Corporation, and
Banque Paribas as Agent (10)                                                                                                      
|        |  |                                                                                                                                                                                                                                                                          
|10.2.3  |  | Amendment No. 3 to Loan Agreement and Waiver dated July 8, 1999, among
CR Briggs Corporation and Banque Paribas as Agent (11)                                                                                                                                            
|        |  |                                                                                                                                                                                                                                                                          
|10.2.4  |  | Amendment No. 4 to Loan Agreement and Waiver dated March 26, 2001,
among CR Briggs Corporation and BNP Paribas, as successor-in-interest to
Banque Paribas as Agent (12)                                                                                                 
|        |  |                                                                                                                                                                                                                                                                          
|10.2.5  |  | Amendment No. 5 to Loan Agreement and Waiver dated March 25, 2002,
among CR Briggs Corporation, Canyon Resources Corporation, and Banque
Paribas, as Agent (13)                                                                                                          
|        |  |                                                                                                                                                                                                                                                                          
|10.2.6  |  | Amendment No. 6 to Loan Agreement and Waiver dated June 14, 2002,
among CR Briggs Corporation and BNP Paribas, as successor-in-interest to
Banque Paribas as Agent (14)                                                                                                  
|        |  |                                                                                                                                                                                                                                                                          
|10.3    |  | Master Tax Lease dated December 27, 1995, between CR Briggs
Corporation and Caterpillar Financial Services Corporation (9)                                                                                                                                               
|        |  |                                                                                                                                                                                                                                                                          
|10.4    |  | Purchase Agreement dated September 25, 1997, between Phelps Dodge
Corporation, acting through its division, Phelps Dodge Mining Company,
and CR Montana Corporation and Canyon Resources Corporation (15)                                                                
|        |  |                                                                                                                                                                                                                                                                          
|10.4.1  |  | Second Amendment and Supplement to Purchase Agreement dated September
17, 1999, between Phelps Dodge Corporation, acting through its division,
Phelps Dodge Mining Company, CR Montana Corporation and Canyon Resources
Corporation, and Seven-Up Pete Joint Venture (11)
|        |  |                                                                                                                                                                                                                                                                          
|10.5    |  | Assignment of Royalty Proceeds, effective as of April 1, 2001,
between Canyon Resources Corporation and Franco-Nevada Mining
Corporation, Inc. (16)                                                                                                                      
|        |  |                                                                                                                                                                                                                                                                          
|31.1*   |  | Certification of Chief Executive Officer pursuant to Rule
13(a)-14(a)/15d-14(a), as adopted pursuant to Section 302 of the
Sarbanes-Oxley Act of 2002                                                                                                                    
|        |  |                                                                                                                                                                                                                                                                          
|31.2*   |  | Certification of Chief Financial Officer pursuant to Rule
13(a)-14(a)/15d-14(a), as adopted pursuant to Section 302 of the
Sarbanes-Oxley Act of 2002                                                                                                                    
|        |  |                                                                                                                                                                                                                                                                          
|32.1*   |  | Certification of Chief Executive Officer pursuant to U.S.C. Section
1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of
2002                                                                                                                           
|        |  |                                                                                                                                                                                                                                                                          
|32.2*   |  | Certification of Chief Financial Officer pursuant to U.S.C. Section
1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of
2002                                                                                                                           



| |  | * Filed herewith
| |  | ----------------





---



##### Table of Contents



|     |  |                                                                                                                                                                                       
|---- |  | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(1)  |  | Exhibit 3.1 is incorporated by reference from Exhibit 3.1(a) to the
Companys Amended Annual Report on Form 10-K/A for the fiscal year ended
December 31, 2000.                       
|     |  |                                                                                                                                                                                       
|(2)  |  | Exhibit 3.1.1 is incorporated by reference from Exhibit 4 of the
Companys Report on Form 8-K filed with the Securities and Exchange
Commission on December 26, 1990.                 
|     |  |                                                                                                                                                                                       
|(3)  |  | Exhibit 3.2 is incorporated by reference from Exhibit 3.2 of the
Companys Annual Report on Form 10-K for the fiscal year ended December
31, 1997.                                    
|     |  |                                                                                                                                                                                       
|(4)  |  | Exhibit 4.1 is incorporated by reference from the Companys
Registration Statement on Form 8-A as declared effective by the
Securities and Exchange Commission on March 18, 1986.     
|     |  |                                                                                                                                                                                       
|(5)  |  | Exhibit 4.2 is incorporated by reference from Exhibit 4.2 of the
Companys Quarterly Report on Form 10-Q for the three months ended March
31, 2002.                                   
|     |  |                                                                                                                                                                                       
|(6)  |  | Exhibit 4.4 is incorporated by reference from Exhibit 4 of the
Companys Report on Form 8-K filed with the Securities and Exchange
Commission on March 27, 1997.                      
|     |  |                                                                                                                                                                                       
|(7)  |  | Exhibit 4.5 is incorporated by reference from Exhibit 4.5 of the
Companys Annual Report on Form 10-K for the fiscal year ended December
31, 2002.                                    
|     |  |                                                                                                                                                                                       
|(8)  |  | Exhibit 10.1 is incorporated by reference from Exhibit 10.20 of the
Companys Annual Report on Form 10-K for the fiscal year ended December
31, 1992.                                 
|     |  |                                                                                                                                                                                       
|(9)  |  | Exhibits 10.2 and 10.3 are incorporated by reference from Exhibits
4.9, 4.10, 10.22 and 10.23 of the Companys Annual Report on Form 10-K
for the fiscal year ended December 31, 1995.
|     |  |                                                                                                                                                                                       
|(10) |  | Exhibits 10.2.1 and 10.2.2 are incorporated by reference from
Exhibits 10.2.1 and 10.2.2 of the Companys Annual Report on Form 10-K
for the fiscal year ended December 31, 1998.     
|     |  |                                                                                                                                                                                       
|(11) |  | Exhibits 10.2.3 and 10.4.1 are incorporated by reference from
Exhibits 10.2.3 and 10.4.1 of the Companys Annual Report on Form 10-K
for the fiscal year ended December 31, 1999.     
|     |  |                                                                                                                                                                                       
|(12) |  | Exhibit 10.2.4 is incorporated by reference from Exhibit 10.2.4 of
the Companys Annual Report on Form 10-K for the fiscal year ended
December 31, 2000.                              
|     |  |                                                                                                                                                                                       
|(13) |  | Exhibit 10.2.5 is incorporated by reference from Exhibit 10.2.5 of
the Companys Annual Report on Form 10-K for the fiscal year ended
December 31, 2001.                              
|     |  |                                                                                                                                                                                       
|(14) |  | Exhibit 10.2.6 is incorporated by reference from Exhibit 10.2.6 of
the Companys Quarterly Report on Form 10-Q for the period ended June
30, 2002.                                    
|     |  |                                                                                                                                                                                       
|(15) |  | Exhibit 10.4 is incorporated by reference from Exhibit 2 of the
Companys Report on Form 8-K filed with the Securities and Exchange
Commission on October 9, 1997.                    
|     |  |                                                                                                                                                                                       
|(16) |  | Exhibit 10.5 is incorporated by reference from Exhibit 1.1 of the
Companys Report on Form 8-K filed with the Securities and Exchange
Commission on October 9, 2001.