SECURITIES AND EXCHANGE COMMISSION


WASHINGTON, D.C. 20549


____________________________





FORM 10-K





x ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934




For Fiscal Year Ended September 30, 2009





OR





o TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934


FOR THE TRANSITION PERIOD FROM _______________________ TO _______________________





Commission File # 000-53371





GRYPHON RESOURCES, INC.


(Exact name of registrant as specified in its charter)





Nevada


(State or other jurisdiction of incorporation or organization)





98-0465540


(IRS Employer Identification Number)





1313 East Maple Street, Suite 201-462


Bellingham, Washington 98225


(Address of principal executive offices)    (Zip Code)





(360) 685-4238


(Registrant’s telephone no., including area code)





Securities registered pursuant to Section 12(b) of the Act: None





Securities registered pursuant to Section 12(g) of the Act:





Common Stock, $0.001 par value


(Title of class)




Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act:   Yes o   No x





Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or 15(d) of the Act:  Yes x   No o





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 o





Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K is not contained herein, and will not be contained, to the best of the registrant’s knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K: Yes [  ]  No [X]





Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company:




Large accelerated filer
o
Accelerated filer
oNon-accelerated filer
o
Smaller reporting company
x





Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Act):   Yes o   No x




State the aggregate market value of the voting and non-voting common equity held by non-affiliates computed by reference to the price at which the common equity was last sold, or the average bid and asked price of such common equity, as of the last business day of the registrant’s most recently completed second fiscal quarter:





Based on the closing price on January 12, 2010 of $0.00, the aggregate market value of the 47,775,000 common shares held by non-affiliates was $nil.





Indicate the number of shares outstanding of each of the registrant’s classes of common stock, as of the latest practicable date: 96,525,000 Common shares were outstanding as of January 12, 2010.




Documents incorporated by reference: None









































ii


GRYPHON RESOURCES, INC. AND SUBSIDIARY


(An Exploration Stage Company)







Table of Contents




PART IITEM 1.
Description of Business
1ITEM 1A.
Risk Factors
1ITEM 1B.
Unresolved Staff Comments
5ITEM 2.
Properties
5ITEM 3.
Legal Proceedings
5ITEM 4.
Submission of Matters to Vote of Security Holders
5PART IIITEM 5.
Market for Company’s Common Equity and Related Stockholder Matters and Issuer Purchases of Equity Securities
6ITEM 6.
Selected Financial Data
7ITEM 7.
Management’s Discussion and Analysis of Financial Condition and Results of Operation
8ITEM 7A.
Quantitative and Qualitative Disclosures About Market Risk
11ITEM 8.
Financial Statements and  Supplementary Data:
12Reports of Independent Registered Public Accounting Firms
13Consolidated Balance Sheets at September 30, 2009 and September 30, 2008
14Consolidated Statements of Operations for the years ended September 30, 2009 and September 30, 2008 and the Exploration Stage Period of January 16, 2006 to September 30, 2009
15Consolidated Statement of Stockholders’ Equity
16Consolidated Statements of Cash Flows for the years ended September 30, 2009 and September 30, 2008 and the Exploration Stage Period of January 16, 2006 to September 30, 2009
17Notes to Financial Statements
18ITEM 9.
Changes in and Disagreements with Accountants on Accounting and Financial Disclosure
25ITEM 9A.
Controls and Procedures
25ITEM 9B.
Other Information
27PART IIIITEM 10.
Directors, Executive Officers and Corporate Governance
27ITEM 11.
Executive Compensation
29ITEM 12.
Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters
30ITEM 13.
Certain Relationships and Related Transactions, and Director Independence
31ITEM 14.
Principal Accounting Fees and Services
31PART IVITEM 15.
Exhibits, Financial Statements Schedules
32SIGNATURES
33











Table of Contents


PART I








ITEM 1.   DESCRIPTION OF BUSINESS





General





Gryphon Resources, Inc. was incorporated in the State of Nevada on January 16, 2006. On April 28, 2008 we incorporated a Turkish company named APM Madencilik Limited (“APM”) as a 99% owned subsidiary. Our financial statements are presented on a consolidated basis and include all accounts of both Gryphon Resources, Inc. and its
subsidiary (hereinafter the consolidated company may be collectively referred to: “Gryphon Resources”, “Gryphon”, “We”, “Us”, the “Registrant”, or the “Company”)





We are a mineral exploration company and are seeking mineral exploration opportunities in Turkey.





Background





Gryphon Resources, Inc. was incorporated in Nevada on January 16, 2006 as Gryphon Oil & Gas Inc. and on August 10, 2006 filed Articles of Amendment with the Nevada Secretary of State to change its name to Gryphon Resources, Inc.





The Company’s common stock is traded in the NASD Over-The-Counter market under the symbol “GRYO”.





Our fiscal year end is September 30th.




ITEM 1A.   RISK FACTORS





The following risk factors should be considered in connection with an evaluation of the business of our business:





THE COMPANY'S LIMITED OPERATING HISTORY MAKES IT DIFFICULT FOR YOU TO JUDGE ITS PROSPECTS.





The Company has a limited operating history upon which an evaluation of the Company, its current business and its prospects can be based. You should consider any purchase of the Company's shares in light of the risks, expenses and problems frequently encountered by all companies in the early stages of its corporate development.





LIQUIDITY AND CAPITAL RESOURCES ARE UNCERTAIN.





For the year ended September 30, 2009, the Company had a Net Loss from Operations of $(126,550). The Company may need to raise additional capital by way of an offering of equity securities, an offering of debt securities, or by obtaining financing through a bank or other entity. The Company has not established a limit as to the amount of debt
it may incur nor has it adopted a ratio of its equity to debt allowance. If the Company needs to obtain additional financing, there is no assurance that financing will be available from any source, that it will be available on terms acceptable to us, or that any future offering of securities will be successful. If additional funds are raised through the issuance of equity securities, there may be a significant dilution in the value of the Company’s outstanding common stock. The Company could suffer adverse
consequences if it is unable to obtain additional capital which would cast substantial doubt on its ability to continue its operations and growth.





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THE VALUE AND TRANSFERABILITY OF THE COMPANY'S SHARES MAY BE ADVERSELY IMPACTED BY THE LIMITED TRADING MARKET FOR ITS SHARES AND THE PENNY STOCK RULES.





There is only a limited trading market for the Company's shares. The Company's common stock is traded in the over-the-counter market and "bid" and "asked" quotations regularly appear on the OTC Bulletin Board under the symbol "GRYO". There can be no assurance that the Company's common stock will trade at prices at or above its present level
and an inactive or illiquid trading market may have an adverse impact on the market price. In addition, holders of the Company's common stock may experience substantial difficulty in selling their securities as a result of the "penny stock rules" which restrict the ability of brokers to sell certain securities of companies whose assets or revenues fall below the thresholds established by those rules.





FUTURE SALES OF SHARES MAY ADVERSELY IMPACT THE VALUE OF THE COMPANY'S STOCK.





If required, the Company may seek to raise additional capital through the sale of common stock. Future sales of shares by the Company or its stockholders could cause the market price of its common stock to decline.





MINERAL EXPLORATION AND DEVELOPMENT ACTIVITIES ARE SPECULATIVE IN NATURE.





Resource exploration and development is a speculative business, characterized by a number of significant risks including, among other things, unprofitable efforts resulting not only from the failure to discover mineral deposits but from finding mineral deposits which, though present, are insufficient in quantity and quality to return a profit
from production. The marketability of minerals acquired or discovered by the Company may be affected by numerous factors which are beyond the control of the Company and which cannot be accurately predicted, such as market fluctuations, the proximity and capacity of milling facilities, mineral markets and processing equipment and such other factors as government regulations, including regulations relating to royalties, allowable production, importing and exporting of minerals and environmental protection, the
combination of which factors may result in the Company not receiving an adequate return of investment capital.





Substantial expenditures are required to establish ore reserves through drilling, to develop metallurgical processes to extract the metal from the ore and, in the case of new properties, to develop the mining and processing facilities and infrastructure at any site chosen for mining. Although substantial benefits may be derived from the discovery
of a major mineralized deposit, no assurance can be given that minerals will be discovered in sufficient quantities and grades to justify commercial operations or that funds required for development can be obtained on a timely basis. Estimates of reserves, mineral deposits and production costs can also be affected by such factors as environmental permitting regulations and requirements, weather, environmental factors, unforeseen technical difficulties, unusual or unexpected geological formations and work interruptions.
In addition, the grade of ore ultimately mined may differ from that indicated by drilling results. Short term factors relating to reserves, such as the need for orderly development of mineralized zones or the processing of new or different grades, may also have an adverse effect on mining operations and on the results of operations. Material changes in ore reserves, grades, stripping ratios or recovery rates may affect the economic viability of any project.





2
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  THE COMPANY WILL BE SUBJECT TO OPERATING HAZARDS AND RISKS WHICH MAY ADVERSELY AFFECT THE COMPANY'S FINANCIAL CONDITION.





Mineral exploration involves many risks, which even a combination of experience, knowledge and careful evaluation may not be able to overcome. The Company's operations will be subject to all the hazards and risks normally incidental to exploration, development and production of metals, such as unusual or unexpected formations, cave-ins or
pollution, all of which could result in work stoppages, damage to property and possible environmental damage. The Company does not have general liability insurance covering its operations and does not presently intend to obtain liability insurance as to such hazards and liabilities. Payment of any liabilities as a result could have a materially adverse effect upon the Company's financial condition.





THE COMPANY'S ACTIVITIES WILL BE SUBJECT TO ENVIRONMENTAL AND OTHER INDUSTRY REGULATIONS WHICH COULD HAVE AN ADVERSE EFFECT ON THE FINANCIAL CONDITION OF THE COMPANY.





The Company's activities are subject to environmental regulations promulgated by government agencies from time to time. Environmental legislation generally provides for restrictions and prohibitions on spills, releases or emissions of various substances produced in association with certain mining industry operations, such as seepage from tailing
disposal areas, which would result in environmental pollution. A breach of such legislation may result in imposition of fines and penalties. In addition, certain types of operations require the submission and approval of environmental impact assessments. Environmental legislation is evolving in a manner which means stricter standards and enforcement, fines and penalties for non-compliance are more stringent. Environmental assessments of proposed projects carry a heightened degree of responsibility for companies
and directors, officers and employees. The cost of compliance with changes in governmental regulations could have an adverse effect on the financial condition of the Company.





The operations of the Company include exploration and development activities and commencement of production on its properties, require permits from various federal, state, provincial and local governmental authorities and such operations are and will be governed by laws and regulations governing prospecting, development, mining, production,
exports, taxes, labor standards, occupational health, waste disposal, toxic substances, land use, environmental protection, mine safety and other matters. Companies engaged in the development and operation of mines and related facilities generally experience increased costs and delays in production and other schedules as a result of the need to comply with applicable laws, regulations and permits.





Failure to comply with applicable laws, regulations, and permitting requirements may result in enforcement actions, including orders issued by regulatory or judicial authorities causing operations to cease or be curtailed, and may include corrective measures requiring capital expenditures, installation of additional equipment, or remedial
actions. Parties engaged in mining operations may be required to compensate those suffering loss or damage by reason of the mining activities and may have civil or criminal fines or penalties imposed for violations of applicable laws or regulations and, in particular, environmental laws.





COMPETITION MAY HAVE AN IMPACT ON THE COMPANY'S ABILITY TO ACQUIRE ATTRACTIVE METALS PROPERTIES, WHICH MAY HAVE AN ADVERSE IMPACT ON THE COMPANY'S OPERATIONS.





Significant and increasing competition exists for the limited number of metals acquisition opportunities available. As a result of this competition, some of which is with large established mining companies with substantial capabilities and greater financial and technical resources than the Company, the Company may





3
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be unable to acquire attractive metals properties on terms it considers acceptable. Accordingly, there can be no assurance that any exploration program intended by the Company on properties it intends to acquire will yield any reserves or result in any commercial mining operation.





DOWNWARD FLUCTUATIONS IN METAL PRICES MAY SEVERELY REDUCE THE VALUE OF THE COMPANY.





The Company has no control over the fluctuations in the prices of the metals for which it is exploring.  A significant decline in such prices would severely reduce the value of the Company.





THE COMPANY CURRENTLY RELIES ON CERTAIN KEY INDIVIDUALS AND THE LOSS OF ONE OF THESE CERTAIN KEY INDIVIDUALS COULD HAVE AN ADVERSE EFFECT ON THE COMPANY.





The Company's success depends to a certain degree upon certain key members of the management. These individuals are a significant factor in the Company's growth and success. The loss of the service of members of the management and advisory board could have a material adverse effect on the Company. In particular, the success of the Company
is highly dependent upon the efforts of the President & CEO, CFO, PAO, Chair & Director of the Company, Serdar Kirmizioglu, the loss of whose services would have a material adverse effect on the success and development of the Company.





THE COMPANY DOES NOT MAINTAIN KEY MAN INSURANCE TO COMPENSATE THE COMPANY FOR THE LOSS OF CERTAIN KEY INDIVIDUALS.





The Company does not anticipate having key man insurance in place in respect of its senior officers or personnel, although the Board has discussed and investigated the prospect of obtaining key man insurance for Serdar Kirmizioglu.





WE ARE AN EXPLORATION STAGE COMPANY, AND THERE IS NO ASSURANCE THAT A COMMERCIALLY VIABLE DEPOSIT OR "RESERVE" EXISTS ON ANY PROPERTIES FOR WHICH THE COMPANY HAS, OR MIGHT OBTAIN, AN INTEREST.





The Company is an exploration stage company and cannot give assurance that a commercially viable deposit, or “reserve,” exists on any properties for which the Company currently has (through an option) or may have (through potential future joint venture agreements or acquisitions) an interest. Therefore, determination of the existence
of a reserve depends on appropriate and sufficient exploration work and the evaluation of legal, economic, and environmental factors. If the Company fails to find a commercially viable deposit on any of its properties, its financial condition and results of operations will be materially adversely affected.





WE REQUIRE SUBSTANTIAL FUNDS MERELY TO DETERMINE WHETHER COMMERCIAL METAL DEPOSITS EXIST ON OUR PROPERTIES.





Any potential development and production of the Company’s exploration properties depends upon the results of exploration programs and/or feasibility studies and the recommendations of duly qualified engineers and geologists. Such programs require substantial additional funds. Any decision to further expand the Company’s operations
on these exploration properties is anticipated to involve consideration and evaluation of several significant factors including, but not limited to:





■
Costs of bringing each property into production, including exploration work, preparation of production feasibility studies, and construction of production facilities;


■
Availability and costs of financing;


■
Ongoing costs of production;





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■
Market prices for the metals to be produced;


■
Environmental compliance regulations and restraints; and


■
Political climate and/or governmental regulation and control.





GENERAL MINING RISKS





Factors beyond our control may affect the marketability of any substances discovered from any resource properties the Company may acquire. Metal prices have fluctuated widely in recent years. Government regulations relating to price, royalties, and allowable production and importing and exporting of metals can adversely affect the Company.
There can be no certainty that the Company will be able to obtain all necessary licenses and permits that may be required to carry out exploration, development and operations on any projects it may acquire and environmental concerns about mining in general continue to be a significant challenge for all mining companies.




ITEM 1B.   UNRESOLVED STAFF COMMENTS




None.




ITEM 2.   PROPERTIES





The Company does not presently have any material property investments.





Office Premises


Gryphon’s office is located at suite 1313 East Maple Street, Suite 201-462, Bellingham, Washington 98225. The Company’s subsidiary APM is located at 1587/1 sok. Rod-kar 2 Is merkezi, No:8, K:7 35110 Cinarli, Izmir, Turkey. Both rental agreements may be cancelled with one month’s notice.




ITEM 3.   LEGAL PROCEEDINGS





There are no material, active, or pending legal proceedings against us, nor are we involved as a plaintiff in any material proceedings or pending litigation. There are no proceedings in which any of our officer and director, or any registered or beneficial shareholders are an adverse party or has a material interest adverse to us.




ITEM 4.   SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS





During the year ended September 30, 2009, shareholders of the Company were asked to vote to approve an increase in the authorized capital of the Company from 75,000,000 common shares to 400,000,000 commons shares. On April 3, 2009, this proposal was approved by a majority of shareholders.











5
 Table of Contents


PART II




ITEM 5.   MARKET FOR COMMON EQUITY AND RELATED STOCKHOLDER MATTERS





Market Information





Our common stock is currently quoted on the NASD OTC Bulletin Board (“OTCBB”). The OTCBB is a network of security dealers who buy and sell stock. The dealers are connected by a computer network that provides information on current "bids" and "asks", as well as volume information. Our shares are quoted on the OTCBB under the symbol
“GRYO”.





The following table sets forth the range of high and low bid quotations for our common stock as reported by the OTCBB for each of the periods indicated. The market for our shares is limited, volatile and sporadic. These quotations reflect inter-dealer prices, without retail mark-up, mark-down or commission and may not necessarily represent
actual transactions.




Quarter Ended:

High Trade


Low Trade


Closing
TradeDecember 31, 2008

$
1.40


$
0.50


$
1.40March 31, 2009


1.80



1.40



1.73June 30, 2009


1.80



1.15



1.73September 30, 2009


1.75



0.36



0.51





Shareholders




On January 12, 2009, there were 2 shareholders of record of our common stock.





Dividends





We intend to retain future earnings to support our growth. Any payment of cash dividends in the future will be dependent upon: the amount of funds legally available therefore; our earnings; financial condition; capital requirements; and other factors which our Board of Directors deems relevant.





Section 15(g) of the Securities Exchange Act of 1934





The Company’s shares are covered by Section 15(g) of the Securities Exchange Act of 1934, as amended, which imposes additional sales practice requirements on broker/dealers who sell such securities to persons other than established customers and accredited investors (generally institutions with assets in excess of $5,000,000 or individuals
with net worth in excess of $1,000,000 or annual income exceeding $200,000 or $300,000 jointly with their spouses). For transactions covered by this Section 15(g), the broker/dealer must make a special suitability determination for the purchase and must have received the purchaser’s written agreement to the transaction prior to the sale. Consequently, Section 15(g) may affect the ability of broker/dealers to sell the Company’s securities and also may affect your ability to sell your shares in the
secondary market.





Section 15(g) also imposes additional sales practice requirements on broker/dealers who sell penny securities. These rules require a one page summary of certain essential items. The items include the risk of investing in penny stocks in both





6
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public offerings and the secondary market; terms important to an understanding of the function of the penny stock market, such as “bid” and “offer” quotes, a dealers “spread” and broker/dealer compensation; the broker/dealer compensation, the broker/dealers duties to its customers, including the disclosures
required by any other penny stock disclosure rules; the customer’s rights and remedies in causes of fraud in penny stock transactions; and, the NASD’s toll free telephone number and the central number of the North American Administrators Association, for information on the disciplinary history of broker/dealers and their associated persons.





Recent Sales of Unregistered Securities





There have been no recent sales of unregistered securities.





ITEM 6.   SELECTED FINANCIAL DATA




FISCAL
2009


FISCAL
2008


FISCAL
2007


FISCAL
2006$

$


$


$Operating Revenue:Quarter One - Three Months to December 31st

Nil


Nil


Nil



n/aQuarter Two - Three Months to  March 31st

Nil


Nil


Nil



n/aQuarter Three- Three Months to June 30th

Nil


Nil


Nil



n/aFull Year – Twelve Months to September 30th

Nil


Nil


Nil


NilNet Income/(Loss):Quarter One - Three Months to December 31st


(15,991
)


(7,981
)


(12,772
)


n/aQuarter Two - Three Months to  March 31st


(45,375
)


(23,758
)


(5,176
)


n/aQuarter Three- Three Months to June 30th


(27,074
)


(25,334
)


(11,500
)


n/aFull Year – Twelve Months to September 30th


(126,550
)


(75,571
)


(47,022
)


(1,243
)Earnings/(Loss) per share:Quarter One - Three Months to December 31st

Nil


Nil


Nil



n/aQuarter Two - Three Months to  March 31st

Nil


Nil


Nil



n/aQuarter Three- Three Months to June 30th

Nil


Nil


Nil



n/aFull Year – Twelve Months to September 30th

Nil


Nil



(0.01
)

NilCash:Quarter One - Three Months to December 31st


23,893



4,703



21,317



n/aQuarter Two - Three Months to  March 31st


11,918



11,126



17,860



n/aQuarter Three- Three Months to June 30th


6,173



9,978



6,435



n/aFull Year – Twelve Months to September 30th


1,572



33,895



11,208



22,502Total assets:Quarter One - Three Months to December 31st


28,797



24,244



49,914



n/aQuarter Two - Three Months to  March 31st


15,090



13,567



37,385



n/aQuarter Three- Three Months to June 30th


15,079



12,751



25,582



n/aFull Year – Twelve Months to September 30th


3,354



37,039



30,706



51,099











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FISCAL
2009


FISCAL
2008


FISCAL
2007


FISCAL
2006$


$


$


$Total stockholders’ equity (deficit):Quarter One - Three Months to December 31st


(88,507
)


(4,746
)


49,061



n/aQuarter Two - Three Months to  March 31st


(133,882
)


(28,504
)


32,309



n/aQuarter Three- Three Months to June 30th


(160,957
)


(53,838
)


20,809



n/aFull Year – Twelve Months to September 30th


(199,066
)


(72,516
)


3,235



50,257Cash dividends per share:Quarter One - Three Months to December 31st

Nil


Nil


Nil



n/aQuarter Two - Three Months to  March 31st

Nil


Nil


Nil



n/aQuarter Three- Three Months to June 30th

Nil


Nil


Nil



n/aFull Year – Twelve Months to September 30th

Nil


Nil


Nil


Nil





ITEM 7.   MANAGEMENT’S DISCUSSION AND ANALYSIS OR PLAN OF OPERATIONS




Certain information included herein contains forward-looking statements that involve risks and uncertainties within the meaning of Sections 27A of the Securities Act, as amended; Section 21E of the Securities Exchange Act of 1934. These sections provide that the safe harbor for forward looking statements does not apply to statements made in initial public offerings. The words, such as "may,"
"would," "could," "anticipate," "estimate," "plans," "potential," "projects," "continuing," "ongoing," "expects," "believe," "intend" and similar expressions and variations thereof are intended to identify forward-looking statements. These statements appear in a number of places in this Form 10-K and include all statements that are not statements of historical fact regarding intent, belief or current expectations of the Company, our directors or our officers, with respect to, among other things: (i) our liquidity
and capital resources; (ii) our financing opportunities and plans; (iii) continued development of business opportunities; (iv) market and other trends affecting our future financial condition; (v) our growth and operating strategy. Investors and prospective investors are cautioned that any such forward-looking statements are not guarantees of future performance and involve risks and uncertainties, and that actual results may differ materially from those projected in the forward-looking statements as a result
of various factors. The factors that might cause such differences include, among others, the following: (i) we have incurred significant losses since our inception; (ii) any material inability to successfully develop our business plans; (iii) any adverse effect or limitations caused by government regulations; (iv) any adverse effect on our ability to obtain acceptable financing; (v) competitive factors; and (vi) other risks including those identified in our other filings with the Securities and Exchange Commission.





Operational Developments during Fiscal 2009





During the year ended September 30, 2009 the Company undertook exploration on the H33D4 property concession held by its subsidiary APM in Turkey. An examination of H33D4 done by an independent geologist showed a block of manganese mineralization measuring approximately 20 x 15 x 5 metres with a grade of approximately 45%, plus other lower
grade manganese mineralization. The visible high grade manganese deposit occurs within a complex mega-breccia (melange) deposit. Other similar manganese blocks were not visible at the surface and no drilling has yet been undertaken. These findings did not verify previous analysis of the Company that H33D4 may have an extensive high grade manganese deposit. However, there is evidence of low grade manganese mineralization hosted by a tectonised sequence of ophiolitic





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rocks. This mineralization extends for at least 400 metres along strike and is composed of a manganiferous chert approximately 3 metres thick on average. This mineralization is estimated to have a grade of approximately 1.2 – 5.7% and does not present an economical case for exploitation at this time.





RESULTS OF OPERATIONS





The following discussion and analysis covers material changes in the financial condition of Gryphon during the years ended September 30, 2009 and September 30, 2008 and the Exploration Stage Period of January 16, 2006 to September 30, 2009 (the “Exploration Stage”).





Revenues





Gryphon did not earn revenues during the periods included in the financial statements in this report.





Expenses





Our operating expenses are classified into six categories:





-  Exploration Expenses


-  Salaries & Wages


-  Professional and Consultant Fees


-  Administrative Expenses


-  Investor Relations


-  Mineral Properties Impairment





Exploration Expenses


Exploration Expenses for the year ended September 30, 2009 totaled $24,226 compared to $2,456 for the year ended September 30, 2008. Expenses for the Exploration Stage totaled $26,682. These expenses were comprised of costs for assaying and geological services on the H33D4 site in Turkey. We cannot yet predict the level of these expenses during
fiscal 2010.





Salaries & Wages


Salaries & Wages for the year ended September 30, 2009 totaled $42,336 compared to $5,074 for the year ended September 30, 2008. Expenses for the Exploration Stage totaled $47,410. These expenses were comprised of costs for three employees in our office in Turkey. We expect the level of these expenses to increase moderately during fiscal
2009 as we implement our business plans.





Professional and Consultant Fees


Professional & Consultant Fees are comprised of fees for work performed by accounting, audit and legal professionals. During the year ended September 30, 2009 these fees totaled $19,953 compared with $32,067 for the year ended September 30, 2008. For the Exploration Stage, these costs totaled $94,400. We anticipate Professional & Consultant
Fees will remain at current levels in the upcoming year.





Administrative Expenses


Administrative Expenses were $28,197 for the year ended September 30, 2009 compared with $14,923 during the year ended September 30, 2008. For the Exploration Stage, Administrative Expenses totaled $48,767. These expenses are composed of travel, Edgar agent filing fees, stock transfer agent fees and general office expenses. We anticipate Administrative
Expenses will increase moderately in the upcoming year.








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Investor Relations


Investor Relations expenses comprise costs for press releases, maintenance of the Company’s website and other investor information initiatives. During the year ended September 30, 2009, these expenses totaled $4,653 versus $nil for the year ended September 30, 2007. For the Exploration Stage, Investor Relations expenses totaled $4,653.
We anticipate Investor Relations expenses will increase in the upcoming year.





Mineral Properties Impairment


The mineral property impairment charge for the year ended September 30, 2008 related to the abandonment of three gold property claims totaling $18,998.





Net (Loss)


We incurred a net loss of $(126,550) for the twelve months ended September 30, 2009 compared with a net loss of $(75,751) for the same period ended September 30, 2008. For the Exploration Stage, the Net Loss totaled $(250,566)





Liquidity and Capital Resources





Since the date of our incorporation, we have raised $51,500 though private placements of our common shares and $105,588 through shareholder loans and 79,626 through loans from other parties. As of September 30, 2009 we had cash on hand of $1,572 and prepaid expenses of $1,782. We project we will need to attempt to raise additional funds during
the coming twelve months and expect we will receive sufficient shareholder loans from our CEO to cover our operating requirements. However, we also project we will need to raise additional equity to provide the funds necessary to explore and develop our current property and have plans to pursue further sales of common shares to existing shareholders and the public.





Off-Balance Sheet Arrangements





The Company does not have any off-balance sheet arrangements that have or are reasonably likely to have a current or future effect on our financial condition, changes in financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources that are material to investors.




Contractual Obligations





The Company has no material contractual obligations outstanding.





Material Events and Uncertainties





Our operating results are difficult to forecast. Our prospects should be evaluated in light of the risks, expenses and difficulties commonly encountered by comparable early stage companies in rapidly evolving markets.





There can be no assurance that we will successfully address such risks, expenses and difficulties.





Our financial statements are prepared in accordance with U.S. generally accepted accounting principles. We have expensed all development costs related to our establishment.











10
 Table of Contents


Employees





As of September 30, 2009, we employed three employees at our subsidiary and used contracted services to perform geological work, legal services and our bookkeeping. Going forward, the Company will use consultants with specific skills to assist with various aspects of its project evaluation, due diligence, acquisition initiatives, corporate
governance and property management and will hire additional staff as needed.





Critical Accounting Policies





Gryphon’s financial statements and related public financial information are based on the application of accounting principles generally accepted in the United States (“GAAP”). GAAP requires the use of estimates; assumptions, judgments and subjective interpretations of accounting principles that have an impact on the assets,
liabilities, revenues and expense amounts reported. These estimates can also affect supplemental information contained in our external disclosures including information regarding contingencies, risk and financial condition. We believe our use if estimates and underlying accounting assumptions adhere to GAAP and are consistently and conservatively applied. We base our estimates on historical experience and on various other assumptions that we believe to be reasonable under the circumstances. Actual results may
differ materially from these estimates under different assumptions or conditions. We continue to monitor significant estimates made during the preparation of our financial statements.





Our significant accounting policies are summarized in NOTE 2 of our financial statements. While all these significant accounting policies impact its financial condition and results of operations, Gryphon views certain of these policies as critical. Policies determined to be critical are those policies that have the most significant impact
on Gryphon’s financial statements and require management to use a greater degree of judgment and estimates. Actual results may differ from those estimates.




ITEM 7A.   QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK





We have not entered into derivative contracts either to hedge existing risk or for speculative purposes.


























11
 Table of Contents





ITEM 8.   FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA





Our financial statements, together with the report of auditors, are as follows:








INDEX TO


FINANCIAL STATEMENTS





PageReports of Independent Registered Public Accounting Firms
13Financial Statements for the years ended September 30, 2009 and September 30, 2008 and for the Exploration Stage of January 16, 2006 to September 30, 2009:Consolidated Balance Sheets
14Consolidated Statements of Operations
15Consolidated Statement of Stockholders’ Equity (Deficit)
16Consolidated Statements of Cash Flows
17Notes to Financial Statements
18
























































12
 Table of Contents





GRYPHON RESOURCES, INC. AND SUBSIDIARY


(An Exploration Stage Company)








Report of Independent Registered Public Accounting Firm





To Board of Directors and


Stockholders of Gryphon Resources, Inc. and Subsidiary (an Exploration Stage Company)





We have audited the accompanying consolidated balance sheets of Gryphon Resources, Inc. and subsidiary (the Company) (an Exploration Stage Company) as of September 30, 2009 and 2008, and the related consolidated statements of operations, stockholders’ equity and cash flows for each of the years in the two-year period ended September
30, 2009. We did not audit the consolidated statements of operations, stockholders’ equity and cash flows for the period from January 16, 2006 (inception) to September 30, 2007. Those financial statements were audited by other auditors whose report has been furnished to us. Our opinion on the consolidated statements of operations, stockholders’ equity, and cash flows for the period from January 16, 2006 (inception) to September 30, 2007 is based solely upon the report of other auditors. Gryphon Resources,
Inc. and Subsidiary (an Exploration Stage Company) management is responsible for these consolidated financial statements. Our responsibility is to express an opinion on these consolidated financial statements based on our audits.





We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. The company is not required to have, nor were we engaged
to perform, an audit of its internal control over financial reporting. Our audit included consideration of internal control over financial reporting as a basis for designing audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the company’s internal control over financial reporting. Accordingly, we express no such opinion. An audit also includes examining, on a test basis, evidence supporting the amounts and disclosures in the
financial statements, assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion.





In our opinion, the consolidated financial statements referred to above present fairly, in all material respects, the consolidated financial position of Gryphon Resources, Inc. and Subsidiary (an Exploration Stage Company) as of September 30, 2009 and 2008, and the consolidated results of its operations and its cash flows for each of the years
in the two-year period ended September 30, 2009, in conformity with accounting principles generally accepted in the United States of America.





The accompanying consolidated financial statements have been prepared assuming that the Company will continue as a going concern. The Company does not have the necessary capital for its planned activity, which raises substantial doubt about its ability to continue as a going concern. Management’s plans in regard to these matters are
described in Note 3 to the financial statements. These financial statements do not include any adjustments that might result for the outcome of this uncertainty.






/s/ Madsen & Associates CPAs, Inc.





Madsen & Associates CPAs, Inc.


Salt Lake City, Utah


January 12, 2010





13
 Table of Contents


GRYPHON RESOURCES, INC. AND SUBSIDIARY


(An Exploration Stage Company)





Consolidated Balance Sheets





September 30,
2009


September 30,
2008ASSETSCURRENT ASSETSCash (Note 2)

$
1,572


$
33,895Prepaid expenses


1,782



3,144Total current assets


3,354



37,039Total assets

$
3,354


$
37,039LIABILITIES AND STOCKHOLDERS’ (DEFICIT)CURRENT LIABILITIESAccounts payable


7,550



2,646Accrued expenses


-



500Loans payable (Note 6)


81,654



4,608Shareholder loans (Note 6)


113,216



101,801Total current liabilities

$
202,420


$
109,555Total liabilities

$
202,420


$
109,555COMMITTMENTS AND CONTINGENCIES (Notes 2, 3, 6, 9 and 10)


-



-STOCKHOLDERS’ EQUITY (DEFICIT)Common shares, 400,000,000 shares par value $0.001authorized, 96,525,000 issued and outstanding (Note 8)


4,950



4,950Paid-in Capital


46,550



46,550Accumulated deficit in the exploration stage


(249,796
)


(124,016
)Total Gryphon Resources, Inc. and Subsidiary equity


(198,296
)


(72,516
)Non-Controlling Interest (Note 2)


(770
)


-Total stockholders’ equity (deficit)


(199,066
)


(72,516
)Total liabilities and stockholders’ equity (deficit)

$
3,354


$
37,039











The accompanying notes to financial statements are an integral part of this statement





14
 Table of Contents





GRYPHON RESOURCES, INC. AND SUBSIDIARY


(An Exploration Stage Company)





Consolidated Statements of Operations





Year ended
September 30,
2009


Year ended
September 30,
2008


Exploration Stage
January 16, 2006 through
September 30,
2009EXPENSES:Exploration expenses


24,226



2,456



26,682Salaries & wages


42,336



5,074



47,410Professional and consultant fees


19,953



32,067



94,400Administrative expenses


28,197



14,923



48,767Investor relations


4,653



-



4,653Mineral properties impairment (Note 4)


-



18,998



18,998Total expenses

$
119,365


$
73,518


$
240,910Net loss from operations

$
(119,365
)

$
(73,518
)

$
(240,910
)Interest expense


(7,185
)


(2,233
)


(9,656
)Net Income (Loss)

$
(126,550
)

$
(75,751
)

$
(250,566
)Less: Net Loss attributable to Non-ControllingInterest (Note 2)


770



-



770Equals: Net Loss attributable to Gryphon Resources, Inc. and Subsidiary (Note 2)


(125,780
)


(75,751
)


(249,796
)Loss per common share (Note 2), basicand diluted

$
0.00


$
0.00Weighted average shares outstanding , basic and diluted (Notes 2 and 8)


96,525,000



96,525,000




























15
 Table of Contents





GRYPHONRESOURCES, INC. AND SUBSIDIARY


(An Exploration Stage Company)





Consolidated Statement of Stockholders’ Equity (Deficit)





Common
Shares


Common
Stock


Paid-in
Capital


Deficit Attributable to Non-Controlling Interest


Deficit Accumulated During the Exploration
Stage


Total
Stockholders’ EquityCommon shares issued for cash at $0.001January 27, 2006


48,750,000


$
2,500


$
—


$
—


$
—


$
2,500Common shares issued for cash at  $0.02 duringthe period ended September 30, 2006


47,775,000


$
2,450


$
46,550


$
—


$
—


$
49,000Net loss for the period from January 16, 2006(inception) to September 30, 2006


—


$
—


$
—


$
—


$
(1,243
)

$
(1,243
)Balance, September 30, 2006


96,525,000


$
4,950


$
46,550


$
—


$
(1,243
)

$
50,257Net loss for year ended September 30, 2007


—


$
—


$
—


$
—


$
(47,022
)

$
(47,022
)Balance, September 30, 2007


96,525,000


$
4,950


$
46,550


$
—


$
(48,265
)

$
3,235Net loss for year ended September 30, 2008


—


$
—


$
—


$
—


$
(75,751
)

$
(75,571
)Balance, September 30, 2008


96,525,000


$
4,950


$
46,550


$
—


$
(124,016
)

$
(72,516
)Net loss for year ended September 30, 2009


—


$
—


$
—


$
(770
)

$
(125,780
)

$
(126,550
)Balance, September 30, 2009


96,525,000


$
4,950


$
46,550


$
(770
)

$
(249,796
)

$
(199,066
)

































The accompanying notes to financial statements are an integral part of this statement


16
 Table of Contents


GRYPHON RESOURCES, INC. AND SUBSIDIARY


(An Exploration Stage Company)





Consolidated Statements of Cash Flows





Year ended
September 30,
2009


Year ended
September 30,
2008


Exploration Stage
January 16, 2006 through
September 30,
2009Cash flows from operating activities:Net Income (Loss) for period

$
(126,550
)

$
(75,751
)

$
(250,566
)Reconciling adjustments:Adjustments to reconcile net loss to net cashused in operating activities:Accrued interest on shareholder loans


5,175



2,215



7,628Accrued interest on loans


2,010



18



2,028Property abandonments


-



18,998



18,998Net change in operating assets and liabilities:Prepaid expenses


1,362



(2,644
)


(1,782
)Accounts payable and accrued  liabilities


4,404



(8,373
)


7,550Net cash provided (used) by operating activities


(113,599
)


(65,537
)


(216,144
)Cash flows from investing activities:Purchase of mineral properties


-



-



(18,998
)Net cash provided by investing activities


-



-



(18,998
)Cash flows from financing activities:Common stock issued for cash


-



-



51,500Loans


75,036



4,590



79,626Shareholder loans


6,240



83,634



105,588Net cash provided by financing activities


81,276



88,224



236,714Net increase (decrease) in cash


(32,323
)


22,687



1,572Cash, beginning of period


33,895



11,208



-Cash, end of period

$
1,572


$
33,895


$
1,572




















The accompanying notes to financial statements are an integral part of this statement


17
 Table of Contents


GRYPHON RESOURCES, INC. AND SUBSIDIARY


(An Exploration Stage Company)





Notes to Financial Statements








NOTE 1 – Nature of Business and Operations





Gryphon Resources, Inc. was incorporated in the State of Nevada on January 16, 2006. On April 28, 2008 we incorporated a Turkish company named APM Madencilik Limited. (“APM”) as a 99% owned subsidiary. The remaining balance of 1% of APM shares are held by our CEO. Our financial statements are presented on a consolidated basis and
include all accounts of both Gryphon Resources, Inc. and its subsidiary (hereinafter the consolidated company may be collectively referred to: “Gryphon Resources”, “Gryphon”, “We”, “Us”, the “Registrant”, or the “Company”)





We are a mineral exploration company and are seeking mineral exploration opportunities in Turkey.





Our fiscal year end is September 30th.





Exploration Stage Activities




The Company has been in the exploration stage since January 16, 2006 and has not yet realized any revenues from its operations.




NOTE 2 – Summary of Significant Accounting Policies





This summary of significant accounting policies is presented to assist in understanding Gryphon’s financial statements. The financial statements and notes are representations of the Company’s management, who is responsible for their integrity and objectivity. These accounting policies conform to generally accepted accounting principles
in the United States of America and have been consistently applied in the preparation of the financial statements, which are stated in U.S. Dollars.





The financial statements reflect the following significant accounting policies:





Exploration Stage Company





The Company is an exploration stage company as defined by SEC Industry Guide 7. The Company is devoting substantially all of its present efforts to establish a new business and none of its planned principal operations have commenced.  As an exploration stage enterprise, the Company discloses the deficit accumulated during the exploration
stage and the cumulative statements of operations and cash flows from inception to the current balance sheet date.





Exploration Costs and Mineral Property Right Acquisitions





The Company is primarily engaged in the acquisition and exploration of mining properties.  Mineral property exploration costs are expensed as incurred.  Mineral property acquisition costs are initially capitalized when incurred. The Company assesses the carrying costs for impairment under Accounting Standards 930 Extractive
Activities – Mining (AS 930) at each fiscal quarter end.  An impairment is recognized when the sum of the expected undiscounted future cash flows is less than the carrying amount of the mineral property.  Impairment losses, if any, are measured as the excess of the carrying amount of the mineral property over its estimated fair value.








18
 Table of Contents


GRYPHON RESOURCES, INC. AND SUBSIDIARY


(An Exploration Stage Company)




Notes to Financial Statements








When it has been determined that a mineral property can be economically developed as a result of establishing proven and probable reserves, the costs then incurred to develop such property, are capitalized.  Such costs will be amortized using the units-of-production method over the estimated life of the proven and probable reserves.  If
mineral properties are subsequently abandoned or impaired, any capitalized costs will be charged to operations.





Consolidation of Financial Statements





These financial statements include the accounts of the Company and its subsidiary APM Madencilik Limited on a consolidated basis. All inter-company accounts have been eliminated.





Non-Controlling Interest





As required by GAAP, the Consolidated Balance Sheet and Consolidated Statements of Operations of these financial statements include the allocation to ‘Non-Controlling Interest’ of a proportionate share of the Company’s net losses relating to the 1% ownership interest in APM Madencilik Limited which is not owned by the Company.





Use of Estimates





The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues
and expenses during the period. Actual results could differ from those estimates.





Earnings or (Loss) per Share





Basic loss per share is calculated by dividing the net loss available to common stockholders by the weighted average number of common shares outstanding for the period. The denominator in this calculation is adjusted to reflect any stock splits or stock dividends. On June 23, 2008, the Company declared an 18.5 for 1 stock dividend. The Record
date and Payment date for this stock dividend were July 3, 2008 and July 7, 2008 respectively. This dividend had the effect of increasing the issued and outstanding share capital of the Company from 4,950,000 shares to 96,525,000 shares. All references to stock issued and stock outstanding have been retroactively adjusted as if the stock split and stock dividend had taken place at the earliest date shown.





Diluted loss per share is calculated using the treasury method which requires the calculation of diluted loss per share by assuming that any outstanding stock options with an average market price that exceeds the average exercise prices of the options for the year, are exercised and the assumed proceeds are used to repurchase shares of the
Company at the average market price of the common shares for the year. An incremental per share effect is then calculated for each option. The denominator of the diluted loss per share formula is the number common shares outstanding at balance sheet date plus the incremental shares assumed to be issued from treasury for option exercises, less the number of shares assumed to be repurchased, weighted by the period they are assumed to be outstanding. This dilution calculation did not affect current fiscal year results
because the Company does not have an Option Plan and has not issued any stock options.











19
 Table of Contents


GRYPHON RESOURCES, INC. AND SUBSIDIARY


(An Exploration Stage Company)





Notes to Financial Statements








Stock Based Compensation





The Company applies the fair value method of accounting for all stock and stock option awards. Under this method the Company measures compensation expense for stock option grants based on the fair value of the option on the date of grant and amortizes this cost over the vesting period. In cases where vesting is immediate, the full cost of
the grant is recorded on grant date. This costing calculation did not affect current fiscal year results because the Company has not made any stock awards.





Estimated Fair Value of Financial Instruments





The carrying value of the Company’s financial instruments reflected in the financial statements approximates fair value due to the short-term maturity of the instruments. It is management’s opinion that the Company is not exposed to significant interest, currency or credit risks arising from these financial instruments.





Income Taxes





The Company recognizes deferred tax liabilities and assets for the expected future tax consequences of events that have been recognized in the Company’s financial statements or tax returns using the liability method. Under this method, deferred tax liabilities and assets are determined based on the temporary differences between the financial
statement carrying amounts and tax bases of assets and liabilities using enacted rates in effect in the years during which the differences are expected to reverse and upon the possible realization of net operating loss carry-forwards. Additionally, the Company has not recognized any amount for a tax position taken or expected to be taken on its tax return, or for any interest or penalties.





Valuation of Long-Lived Assets





The Company will periodically analyze its long-lived assets for potential impairment, assessing the appropriateness of lives and recoverability of unamortized balances through measurement of undiscounted operation cash flows on a basis consistent with accounting principles generally accepted in the United States of America.





Foreign Currency





The books of the Company are maintained in United States dollars and this is the Company’s functional and reporting currency. Transactions denominated in other than the United States dollar are translated as follows with the related transaction gains and losses being recorded in the Statements of Operations:





(i)
Monetary items are recorded at the rate of exchange prevailing as at the balance sheet date;


(ii)
Non-Monetary items including equity are recorded at the historical rate of exchange; and


(iii)
Revenues and expenses are recorded at the period average in which the transaction occurred











20
 Table of Contents


GRYPHON RESOURCES, INC. AND SUBSIDIARY


(An Exploration Stage Company)





Notes to Financial Statements








Cash and Cash Equivalents





The Company considers cash and cash equivalents to consist of cash on hand and demand deposits in banks with an initial maturity of 90 days or less.





Risks and Uncertainties





The Company is subject to substantial business risks and uncertainties inherent in starting a new business. There is no assurance the Company will be able to generate sufficient revenues or obtain sufficient funds necessary for launching a new business venture.





Revenue Recognition





Revenue from the sale of precious and/or base metals and co-products will be recognized when the following conditions are met: persuasive evidence of an arrangement exists; delivery has occurred in accordance with the terms of the arrangement; the price is fixed or determinable and collectability is reasonably assured. Revenue for precious
metal bullion will be recognized at the time of delivery and transfer of title to counter-parties.





Capital Assets





Capital assets will be recorded at cost. Depreciation will be recorded based on estimated useful lives of assets at time of acquisition. At present the Company has no depreciable assets.





Recent Accounting Pronouncements





Various accounting pronouncements have been issued during 2009 and 2008, none of which are expected to have a material effect on the financial statements of the Company.





Other





The Company paid no dividends during the periods presented.





The Company consists of one reportable business segment. The Company has no revenue to report from any customers.





As at year end September 30, 2009 the Company's assets with carrying value are located in the United States and Turkey.





Advertising is expensed as it is incurred.





Certain comparative figures in these statements have been reclassified to conform to current year classifications.





We did not have any off-balance sheet arrangements as at September 30, 2009 or September 30, 2008.











21
 Table of Contents


GRYPHON RESOURCES, INC. AND SUBSIDIARY


(An Exploration Stage Company)





Notes to Financial Statements








NOTE 3 – Basis of Presentation and Going Concern





Generally accepted accounting principles in the United States of America contemplate the continuation of the Company as a going concern. However, the Company had a net loss attributable to Gryphon Resources, Inc. and Subsidiary of $(125,780). Additionally it has accumulated an operating losses since its inception, a deficit in working capital
and stockholders equity and has had limited business operations, which raises substantial doubt about the Company’s ability to continue as a going concern. The continuation of the Company is dependent on many factors, many of which have a high degree of uncertainty.





During the year ended September 30, 2009, we addressed the going concern issue by raising cash of $6,240 in shareholder loans and $75,036 in loans from other parties. The Company’s ability to continue as a going concern is contingent upon the successful completion of additional financing arrangements and its ability to successfully fulfill
its business plan. Management plans to attempt to raise additional funds to finance the operating and capital requirements of the Company through a combination of equity and debt financings. While the Company is making its best efforts to achieve the above plans, there is no assurance that any such activity will generate funds that will be available for operations. The accompanying financial statements do not include any adjustments that might result from the resolution of these matters.





NOTE 4 - Impairment of Mineral Properties





During the interim period ended June 30, 2008, the Company undertook a review of the Company’s exploration projects and determined the Company should not proceed with the exploration of three gold property claims in the Province of Saskatchewan. As a result, an impairment charge was recorded and the related mineral property assets were
removed from the accounting records of the Company.





NOTE 5 – Acquisition





On April 28, 2008, the Company acquired 99 shares of the common stock (and 99% of the shares issued and outstanding) of APM Madencilik Limited (“APM”). This Company is located in Turkey. The purchase price was $15,338. The entire purchase price was allocated to APM’s cash accounts, totaling $15,338. No other assets or liabilities
were acquired; therefore, no goodwill was recorded. The remaining 1% interest in APM is held by our CEO.





NOTE 6 – Shareholder Loan and Loans Payable





At September 30, 2009, the Company had one shareholder loan outstanding from a related party of $113,216, which included $5,175 of accrued interest for the year ended September 30, 2009 and total accrued interest of $7,628 since inception. This loan is uncollateralized and has no fixed repayment date and is callable at any time. During the
twelve months ended September 30, 2009 this shareholder loan increased by $11,415, after including accrued interest.





At September 30, 2009, the Company had a loan payable to a private company in Turkey. The loan totaled $81,654, which included $2,010 of accrued interest for the year ended September 30, 2009.  The loan is uncollateralized, has no fixed repayment date and is callable at any time. During the twelve months ended September 30, 2009
this loan increased by $77,046, after including accrued interest.





22
 Table of Contents


GRYPHON RESOURCES, INC. AND SUBSIDIARY


(An Exploration Stage Company)





Notes to Financial Statements








NOTE 7 – Related Party Transactions





During the year ending September 30, 2009 related party transactions included: (i) the shareholder loan activity recorded in Note 6; and (ii) payment of $27,577 in wages to our CEO.





NOTE 8 – Common Stock





On January 27, 2006, the Company issued 2,500,000 shares of its common stock to its founding President for cash. This transaction was valued at a board approved value of $0.001 per share for total proceeds of $2,500.





During the fiscal year ending September 30, 2006, the Company issued 2,450,000 shares of its common stock in a private offering at $0.02 per share for total proceeds of $49,000.





On June 23, 2008, the Company declared an 18.5 for 1 stock dividend. The Record date and Payment date for this stock dividend were July 3, 2008 and July 7, 2008 respectively. The Company instructed its Transfer Agent to round up to one for any fractional interest which resulted in the calculation of the dividend. This dividend had the effect
of increasing the issued and outstanding share capital of the Company from 4,950,000 shares to 96,525,000 shares. All references to stock issued and stock outstanding have been retroactively adjusted as if the stock split and stock dividend had taken place at the earliest date shown.





As recorded in a Form DEF 14C filed May 15, 2009, the Company amended its Articles of Incorporation to increase the authorized number of shares of common stock from 100,000,000 shares to 400,000,000 shares, par value of $0.001 per share.





NOTE 9 – Operating Leases





Office premises in the US and Turkey are leased on a monthly basis. Gryphon’s office is located at suite 1313 East Maple Street, Suite 201-462, Bellingham, Washington 98225 and incurs monthly rent of $80. The Company’s subsidiary APM is located at 1587/1 sok. Rod-kar 2 Is merkezi, No:8, K:7 35110 Cinarli, Izmir, Turkey and incurs
monthly rent of 1,300 Turkish Lira (US$ $871). Both rental agreements may be cancelled with one month’s notice.





NOTE 10 – Income Taxes





The Company is subject to federal income taxes in the United States and Turkey. The Company had no income taxes payable during the reported periods due to net operating losses.





Deferred income taxes arise from temporary timing differences in the recognition of income and expenses for financial reporting and tax purposes. The Company's deferred tax assets consist entirely of the benefit from net operating loss carry-forwards. The Company's deferred tax assets are offset by a valuation allowance due to the uncertainty
of the realization of the net operating loss carry-forwards.  Net operating loss carry-forwards may be further limited by a change in company ownership and other provisions of the tax laws.





23
 Table of Contents


GRYPHON RESOURCES, INC. AND SUBSIDIARY


(An Exploration Stage Company)





Notes to Financial Statements








Income taxes at the statutory rate are reconciled to the Company’s actual income taxes as follows:





Income tax benefit at statutory rate resulting from net operating Loss carryforward


(35
%)Deferred income tax valuation allowance


35
%Actual tax rate


0
%





The Company's deferred tax assets, valuation allowance, and change in valuation allowance are as follows (“NOL” denotes Net Operating Loss):





Year Ending

Estimated
NOL
Carry-forward


NOL
Expires


Estimated
Tax
Benefit
from NOL


Valuation
Allowance


Net Tax
Benefit2006

$
(1,243
)


2026


$
435


$
( 435
)

$
—2007

$
(47,202
)


2027


$
16,521


$
(16,521
)

$
—2008

$
(75,571
)


2028


$
26,450


$
(26,450
)

$
—2009

$
(125,780
)


2029


$
44,023


$
(44,023
)

$
—$
(249,796
)





$
87,429


$
(87,429
)

$
—


The total valuation allowance for the year ended September 30, 2009 is $(87,429) which increased by $(44,023) for the year ended September 30, 2009.




















24
 Table of Contents





ITEM 9.  CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE





There were no disagreements with our accountants regarding accounting and financial disclosure matters.




ITEM 9A.  CONTROLS AND PROCEDURES





Evaluation of Disclosure Controls and Procedures





The Company maintains disclosure controls and procedures that are designed to ensure that information required to be disclosed in the Company's Exchange Act reports is recorded, processed, summarized and reported within the time periods specified in the SEC's rules and forms, and that such information is accumulated and communicated to the
Company's management, including its Chief Executive Officer and Chief Financial Officer, as appropriate, to allow timely decisions regarding required disclosure based closely on the definition of "disclosure controls and procedures" in Rule 13a-15(e). The Company's disclosure controls and procedures are designed to provide a reasonable level of assurance of reaching the Company's desired disclosure control objectives. In designing and evaluating the disclosure controls and procedures, management recognized that
any controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving the desired control objectives, and management necessarily was required to apply its judgment in evaluating the cost-benefit relationship of possible controls and procedures. The Company's certifying officer has concluded that the Company's disclosure controls and procedures are ineffective in reaching that level of assurance.





As of the end of the period being reported upon, the Company carried out an evaluation, under the supervision and with the participation of the Company's management, including the Company's Chief Executive Officer and the Company's Chief Financial Officer, of the effectiveness of the design and operation of the Company's disclosure controls
and procedures. Based on the foregoing, our Chief Executive Officer and Chief Financial Officer concluded that our disclosure controls and procedures were not effective.





Management's Report on Internal Control over Financial Reporting





Management of the Company is responsible for establishing and maintaining adequate internal control over financial reporting (as defined in Section 13a-15(f) of the Securities Exchange Act of 1934, as amended). Internal control over financial reporting is a process designed by, or under the supervision of, the Company's CFO to provide reasonable
assurance regarding the reliability of financial reporting and the preparation of the Company's financial statements for external reporting purposes in conformity with U.S. generally accepted accounting principles and include those policies and procedures that (i) pertain to the maintenance of records that in reasonable detail accurately and fairly reflect the transactions and disposition of the assets of the company; (ii) provide reasonable assurance that transactions are recorded as necessary to permit preparation
of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the Company are being made only in accordance with authorizations of management and directors of the Company; and (iii) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use or disposition of the Company's assets that could have a material effect on the financial statements.











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As of September 30, 2009, management conducted an assessment of the effectiveness of the Company's internal control over financial reporting based on the framework established in Internal Control-Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Based on the criteria established by
COSO management concluded that the Company's internal control over financial reporting was not effective as of September 30, 2009, as a result of the identification of the material weaknesses described below.





A material weakness is a deficiency or combination of deficiencies in internal control over financial reporting, such that there is a reasonable possibility that a material misstatement of the annual or interim financial statements will not be prevented or detected on a timely basis.





Specifically, management identified the following control deficiencies: (1) The Company has not properly segregated duties as one or two individuals initiate, authorize, and complete all transactions. The Company has not implemented measures that would prevent the individuals from overriding the internal control system. The Company does not
believe that this control deficiency has resulted in deficient financial reporting because the Chief Financial Officer is aware of his responsibilities under the SEC's reporting requirements and personally certifies the financial reports; (2) The Company has installed accounting software that does not prevent erroneous or unauthorized changes to previous reporting periods and does not provide an adequate audit trail of entries made in the accounting software. Accordingly, while the Company has identified certain
material weaknesses in its system of internal control over financial reporting, it believes that it has taken reasonable steps to ascertain that the financial information contained in this report is in accordance with generally accepted accounting principles. Management has determined that current resources would be appropriately applied elsewhere and when resources permit, they will alleviate material weaknesses through various steps.





This annual report does not include an attestation report of the Company's registered public accounting firm regarding internal control over financial reporting. Management's report was not subject to attestation by the Company's registered public accounting firm pursuant to temporary rules of the Securities Exchange Commission that permit
the Company to provide only management's report in this annual report.





Changes in Internal Control over Financial Reporting





During the last quarter of the Company’s fiscal year ended September 30, 2009, the Certifying Officers reviewed our internal control over financial reporting (as defined in rules 13a-15(f) and 15d-15(f)) under the Exchange Actas
of the Evaluation Date and concluded that no changes occurred in such control or in other factors during the last fiscal quarter that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting. Deficiencies identified include the inadequate segregations of duties, lack of controls over procedures used to enter transactions into the general ledger, and lack of appropriate review of the reconciliations and supporting workpapers used in the financial close
and reporting process. Due to the potential pervasive effect on the financial statement account balances and disclosures and the importance of the annual and interim financial closing and reporting process, in the aggregate, management concluded that there was more than a remote likelihood that a material misstatement in our annual or interim financial statements could occur and would not be prevented or detected.





Remediation Plan





Addition of staff


We have identified that additional staff will be required to properly segment the accounting duties of the Company. However, we do not currently have resources to fulfill this part of our plan and will be addressing this matter once sufficient resources are available.








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ITEM 9B.   OTHER INFORMATION





None.








PART III








ITEM 10.  DIRECTORS, EXECUTIVE OFFICERS, AND CORPORATE GOVERNANCE





Our directors and officers, as of September 30, 2009, were as set forth below. The directors hold office for their respective term and until their successors are duly elected and qualified. Vacancies in the Board are filled by a majority vote of the remaining directors. The officers serve at the will of the Board of Directors. The term of
the directors listed below is each one year.





Name
Age
Positions and Offices HeldSerdar Kirmizioglu
34
President & Chief Executive Officer, Chief Financial Officer, Principal Accounting Officer, Secretary and Treasurer*, Director and Board Chair*(subsequent to September 30, 2009, Mr. David Walker was appointed Secretary and Treasurer)





Set forth below is a brief description of the background and business experience of our executive officers and directors for the past five years.





Serdar Kirmizioglu





Mr. Kirmizioglu has extensive experience in mining operations management and engineering. He has held a series of progressively senior positions in a variety of mining and construction firms in Turkey. From 2000 to 2003 he held the position of Raw Material Manager and subsequently Quality Control Manager of Bleaching Refined Oil Processing
with Bensan Activated Bentonit Industry Co. From 2004 to 2006 he was the Project and R&D Manager and subsequently Quarry Enterprise, Production Manager for Bemas Concrete Manufacturing and Construction Materials Co. During 2006, Mr. Kirmizioglu was the Technical Manager for Asos Marble Co. and in 2007 held the position of Assistant Chairman of the Board of Directors for Kirser Mining and Construction Co. Mr. Kirmizioglu joined Gryphon Resources, Inc. as President & CEO in 2008.





Mr. Kirmizioglu is a member of the Turkish Chamber of Mining Engineers and received his degree as Bachelor of Mining Engineering from Cukurova University in 1998.





Family Relationships





There are no family relationships between or among any of our officers or directors.








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Involvement in Certain Legal Proceedings





To our knowledge, during the past five years, no present or former director or executive officer of the Company: (1) filed a petition under the federal bankruptcy laws or any state insolvency law, nor had a receiver, fiscal agent or similar officer appointed by a court for the business or present of such a person, or any partnership in which
he was a general partner at or within two years before the time of such filing, or any corporation or business association of which he was an executive officer within two years before the time of such filing; (2) was convicted in a criminal proceeding or named subject of a pending criminal proceeding (excluding traffic violations and other minor offenses); (3) was the subject of any order, judgment or decree, not subsequently reversed, suspended or vacated, of any court of competent jurisdiction, permanently
or temporarily enjoining him from or otherwise limiting the following activities:





(i) acting as a futures commission merchant, introducing broker, commodity trading advisor, commodity pool operator, floor broker, leverage transaction merchant, associated person of any of the foregoing, or as an investment advisor, underwriter, broker or dealer in securities, or as an affiliated person, director of any investment company,
or engaging in or continuing any conduct or practice in connection with such activity; (ii) engaging in any type of illegal business practice; (iii) engaging in any activity in connection with the purchase or sale of any security or commodity or in connection with any violation of federal or state securities laws or federal commodity laws; (4) was the subject of any order, judgment or decree, not subsequently reversed, suspended or vacated, of any federal or state authority barring, suspending or otherwise limiting
for more than 60 days the right of such person to engage in any activity described above under this Item, or to be associated with persons engaged in any such activity; (5) was found by a court of competent jurisdiction in a civil action or by the Securities and Exchange Commission to have violated any federal or state securities law and the judgment in subsequently reversed, suspended or vacate; (6) was found by a court of competent jurisdiction in a civil action or by the Commodity Futures Trading Commission
to have violated any federal commodities law, and the judgment in such civil action or finding by the Commodity Futures Trading Commission has not been subsequently reversed, suspended or vacated.





Audit Committee Financial Expert





In 2006 the Board delegated responsibilities of the Audit Committee to the full Board. Due to the fact that the Company is in its exploration stage, it has not yet been able to recruit and compensate a financial expert for the Audit Committee.





Compliance With Section 16(a) of the Exchange Act - Beneficial Ownership Reporting Compliance





Section 16(a) of the Exchange Act as amended requires the Company's officers and directors, and persons who own more than 10% of a registered class of the Company's equity securities (the "10% Stockholders"), to file reports of ownership and changes of ownership with the Securities and Exchange Commission. Officers, directors and 10% Stockholders
of the Company are required by Commission regulation to furnish the Company with copies of all Section 16(a) forms so filed.





Based solely upon a review of filings made and other information available to it, the Company believes that each of the Company's present Section 16 reporting persons filed all forms required of them by Section 16(a) during the year ended September 30, 2009.





Based solely upon a review of the Forms 3, 4, and 5 furnished to us for the fiscal year ended September 30, 2009, we have determined that our directors, officers, and greater than 10% beneficial owners complied with all applicable Section 16 filing requirements.








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  Code of Ethics and Conduct





The Board approved a code of ethics and conduct which was filed as an exhibit to our registration statement on Form SB-2 filed February 26, 2006 and is incorporated herein by this reference.





Director Compensation





During the year ended September 30, 2009, there were no cash payments, nor stock or option grants made to any directors.





ITEM 11.  EXECUTIVE COMPENSATION





The following tables set forth information regarding the salaries and other compensation paid to our executive officer in our most recent fiscal year ended September 30, 2009 and since inception:





SUMMARY COMPENSATION TABLEName and Principal Position

Year

Salary
($)

Bonus ($)

Other Annual Compensation
($)

Restricted Stock Awards or SARs ($) (1)

Securities Underlying Options or
SARs (#)

LTIP Payouts
($) (2)

All Other Compensation
($)Serdar Kirmizioglu President & CEO, CFO, PAO

Fiscal
2009


27,577

Nil

Nil

Nil

Nil

Nil

NilSerdar Kirmizioglu President & CEO, CFO, PAO

Fiscal
2008


1,940

Nil

Nil

Nil

Nil

Nil

NilLou Jurinak President & CEO, CFO, PAO

Fiscal
2008

Nil

Nil

Nil

Nil

Nil

Nil

NilLou Jurinak President & CEO, CFO, PAO

Fiscal
2007

Nil

Nil

Nil

Nil

Nil

Nil

NilLou Jurinak President & CEO, CFO, PAO

Fiscal
2006

Nil

Nil

Nil

Nil

Nil

Nil

Nil(1) SARs are “Stock Appreciation Rights”(2) LTIP’s are “Long-Term Incentive Plans”





Option/SAR Grants in Last Fiscal YearName

Number of Securities Underlying Options or SAR’s
(#)

Percentage of
Total Options or SARs Granted to Employee in Fiscal Year

Exercise Price
($/share)

Expiration Date

Grant Date
Value ($)(no grants made)

Nil

-

-

-

-








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Aggregated Option/SAR Exercises and Fiscal Year-End Options/SAR TableName

Shares Acquired
on Exercise
(#)

Value Realized
($)

Number of Securities
Underlying Unexercised
Options/SARs at FY-end
(#)

Value of Unexercised
In-the-Money Options/SARs
at FY-End
($)Exercisable

Unexercisable

Exercisable

Unexercisable(no grants made)

Nil

Nil

Nil

Nil

Nil

Nil


The Company has not adopted an Options Plan.





No retirement, pension, profit sharing, or insurance programs or other similar programs have been adopted by us for the benefit of our employees.





The Company has not yet established a Compensation Committee of the Board and plans to do so in the near future.





The Company does not have an employment agreement with its President & CEO and there is no policy in place which creates a relationship between corporate performance and executive or director compensation.





ITEM 12.   SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS





Under the rules of the Commission, a person (or group of persons) is deemed to be a "beneficial owner" of a security if he or she, directly or indirectly, has or shares the power to vote or to direct the voting of such security, or the power to dispose of or to direct the disposition
of such security.  Accordingly, more than one person may be deemed to be a beneficial owner of the same security. A person is also deemed to be a beneficial owner of any security, which that person has the right to acquire within 60 days, such as options or warrants to purchase our common stock.





The following table sets forth each person known by us to be the beneficial owner of five percent or more of the Company’s Common Stock and all such persons as a group. Each person has sole voting and investment power with respect to the shares shown.




Security Ownership of Certain Beneficial OwnersTitle of Class

Name and Address of Beneficial Owner

Amount and Nature of Beneficial Owner


Percent of Class (1)Common Stock

Serdar Kirmizioglu
1313 East Maple Street,
Bellingham, Washington 98225


48,750,000



50.5
%Common Stock

All Included Persons as a Group


48,750,000



50.5
%(1) The denominator for this calculation is based on the 96,525,000 issued shares of the Company.











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The following table sets the beneficial ownership of the Company’s Common Stock by all directors and officers individually and all directors and officers of the Company as a group. Each person has sole voting and investment power with respect to the shares shown.





Security Ownership of Certain Beneficial OwnersTitle of Class

Name and Address of Beneficial Owner

Amount and Nature of Beneficial Owner


Percent of ClassCommon Stock

Serdar Kirmizioglu
President & CEO, CFO, PAO,
Secretary & Treasurer,
Director and Board Chair
1313 East Maple Street,
Bellingham, Washington 98225


48,750,000



50.5
%Common Stock

David Walker
Vice President – Administration,
Secretary & Treasurer
1313 East Maple Street,
Bellingham, Washington 98225

Nil


Nil%Common Stock

All Directors & Officers
as a Group


48,750,000



50.5
%








ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR INDEPENDENCE





Transactions with Management and Others





During the year ending September 30, 2009 there were no related party transactions which exceeded $60,000 in value.





Certain Business Relationships





None to report.





ITEM 14.  PRINCIPAL ACCOUNTING FEES AND SERVICES





In its capacity as the Audit Committee, the Board of Directors pre-approves all audit (including audit-related) and permitted non-audit services to be performed by the independent auditors. The Board of Directors annually approves the scope and fee estimates for the year-end audit to be performed by the Corporation’s independent auditors
for the fiscal year. With respect to other permitted services, the Board of Directors pre-approves specific engagements, projects and categories of services on a fiscal year basis, subject to individual project and annual maximums. To date, the Company has not engaged its auditors to perform any non-audit related services.











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Audit Fees


The aggregate fees billed for the last two fiscal years for professional services rendered by the principal accountant for the audit of the Company’s annual financial statements and review of financial statements included in the Company’s Form 10-Qs or services that are normally provided by the accountant in connection with statutory
and regulatory engagements for those fiscal years was:





2009 – $7,235 – Madsen & Associates CPAs Inc.


2008 – $9,500 – Madsen & Associates CPAs Inc.





Audit - Related Fees


The aggregate fees billed in each of the last two fiscal years for assurance and related services by the principal accountants that are reasonably related to the performance of the audit or review of the Company’s financial statements and are not reported in the preceding paragraph:





2009 – $Nil – Madsen & Associates CPAs Inc.


2008 – $Nil – Madsen & Associates CPAs Inc.





Tax Fees


The aggregate fees billed in each of the last two fiscal years for professional services rendered by the principal accountant for tax compliance, tax advice, and tax planning was:





2009 – $Nil – Madsen & Associates CPAs Inc.


2008 – $Nil – Madsen & Associates CPAs Inc.





All Other Fees


The aggregate fees billed in each of the last two fiscal years for the products and services provided by the principal accountant, other than the services reported in paragraphs (1), (2), and (3) was:





2009 – $Nil – Madsen & Associates CPAs Inc.


2008 – $Nil – Madsen & Associates CPAs Inc.














PART IV








ITEM 15.  EXHIBITS, FINANCIAL STATEMENT SCHEDULES


No.
Exhibit Description3.1
Articles of Incorporation*3.2
Certificate of Amendment of Articles of Incorporation*3.2
Bylaws*14.1
Code of Ethics*31.1
Certificate of President and Chief Executive Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 200231.2
Certificate of Chief Executive Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 200232.1
Certificate of Chief Executive Officer and Chief Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002





*    Filed as an exhibit to our registration statement on Form SB-2 filed February 26, 2006 and incorporated herein reference








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SIGNATURES





Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, there unto duly authorized.





GRYPHON RESOURCES, INC.





/s/ Serdar Kirmizioglu


Serdar Kirmizioglu


President and Chief Executive Officer, Chief Financial Officer,


Principal Accounting Officer, Director and Board Chair





/s/David Walker


David Walker


Secretary and Treasurer,





Dated: January 13, 2010






Pursuant to the Securities Act of 1934, this report has been signed below by the following persons on behalf of the Registrant and in the capacities and on the dates indicated.





/s/ Serdar Kirmizioglu


Serdar Kirmizioglu


President and Chief Executive Officer, Chief Financial Officer,


Principal Accounting Officer, Director and Board Chair





/s/David Walker


David Walker


Secretary and Treasurer,





Dated: January 13, 2010











































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