OMB APPROVALOMB Number: 3235-0288
Expires: January 31, 2012
Estimated average burden hours per response.2611.00  UN1TED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549  Form 20-F/A-1 Amendment No. 1 (Mark One)   ̈ REGISTRATION STATEMENT PURSUANT TO SECTION 12(b) OR (g) OF THE SECURITIES EXCHANGE ACT OF 1934  OR   ̈ ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the fiscal year ended  OR  þ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934  For the transition period from February 1, 2009to December 31, 2009_  OR   ̈SHELL COMPANY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 Date of event requiring this shell company report..  Commission file 0-31100  Kiska Metals Corporation (fka Rimfire Minerals Corporation) (Exact name of Registrant as specified in its charter)  Not Applicable (Translation of Registrants name into English)  Yukon (Jurisdiction of incorporation or organization)  Suite 575  510 Burrard Street, Vancouver, British Columbia, Canada, V6C 3A8 (Address of principal executive offices)  -1-  Jason S. Weber Telephone (604) 669-6660 Fax (604) 669-0898 (Name, Telephone, E-mail and/or Facsimile number and Address of Company Contact  Securities registered or to be registered pursuant to Section 12(b) of the Act.  NONE.  Title of each class Name of each exchange on which registered  Securities registered or to be registered pursuant to Section 12(g) of the Act.  Common Shares without par value (Title of Class)  Securities for which there is a reporting obligation pursuant to Section 15(d)of the Act.  Not Applicable (Title of Class) Indicate the number of outstanding shares of each of the issuers classes of capital or common stock as of the close of the period covered by the transition report. 56,741,361  Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act.  ̈YesþNo If this report is an annual or transition report, indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934.  ̈YesþNo Note Checking the box above will not relieve any registrant required to file reports pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 from their obligations under those Sections.  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. þYes ̈No Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, or a non-accelerated filer. See definition of accelerated filer and large accelerated filer in Rule 12b-2 of the Exchange Act. (Check one):  Large accelerated filer  ̈ Accelerated filer ̈ Non-accelerated filer þ   -2-  Indicate by check mark which basis of accounting the registrant has used to prepare the financial statements included in this filing:


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|U.S. GAAP  ̈ | International Financial Reporting Standards as issued by the International Accounting Standards Board  ̈ | Otherþ

If Other has been checked in response to the previous question, indicate by check mark which financial statement item the registrant has elected to follow. þItem l7 ̈Item l8  If this is an annual report, indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).  ̈YesþNo  (APPLICABLE ONLY TO ISSUERS INVOLVED IN BANKRUPTCY PROCEEDINGS DURING THE PAST FIVE YEARS)  Indicate by check mark whether the registrant has filed all documents and reports required to be filed by Sections 12, 13 or 15(d) of the Securities Exchange Act of 1934 subsequent to the distribution of securities under a plan confirmed by a court.  ̈Yes ̈No      Currency: All dollar amounts set forth in this report are in Canadian dollars, except where otherwise indicated.    -3-  EXPLANATORY NOTE  This Amendment No. 1 to the Registrants Transition Report on Form 20-F for the fiscal year ended December 31, 2009 is filed in response to comments from the British Columbia Securities Commissions Staff with respect to the Registrants disclosures under Item 3 (Key Information), Item 4 (Information on the Corporation), Item 5 (Operating Review and Financial Prospects), Item 8 (Financial Information), Item 17 (Financial Statements) and Item 19 (Exhibits). Pursuant to Rule 12b-15 under the Exchange Act, this Amendment No. 1 sets forth the complete text of the above-referenced Items and all amendments thereto, and includes new certifications pursuant to Rules 13a-14(a) or 15d-14(a) and Rules 13a-14(b) or 15d-14(b) under the Exchange Act.  Other than as expressly set forth above, this Amendment No. 1 does not, and does not purport to, amend, update or restate the information in any Item of the Registrants Transition Report on Form 20-F for the fiscal year ended December 31, 2009, or reflect any events that have occurred after the Form 20-F was filed on April 23, 2010.  -4-


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|----------------- | ----------------------------------------------------------------------------------------------------------------------------------------
|Glossary of Terms
|andesite          | a dark-coloured, fine-grained extrusive rock                                                                                            
|antimony          | a chemical element, chemical symbol Sb                                                                                                  
|arsenic           | a chemical element, chemical symbol As                                                                                                  
|arsenopyrite      | a mineral composed of iron, arsenic and sulfur (FeAsS)                                                                                  
|As                | chemical symbol for arsenic                                                                                                             
|Au                | chemical symbol for gold                                                                                                                
|Ba                | chemical symbol for barium                                                                                                              
|barite            | a mineral composed of barium, sulfur and oxygen (BaSO4)                                                                                 
|basalt            | a fine-grained extrusive rock with a lower silica content than andesite                                                                 
|Bi                | chemical symbol for bismuth                                                                                                             
|bismuth           | a chemical element, chemical symbol Bi                                                                                                  
|breccia           | rock composed of angular broken rock fragments held together by a mineral cement or in a fine-grained matrix                            
|chalcopyrite      | a mineral composed of copper, iron and sulfur (CuFeS2)                                                                                  
|chert             | a hard, dense or compact sedimentary rock consisting dominantly of interlocking quartz crystals or amorphous silica                     
|clastic           | composed of sedimentary grains                                                                                                          
|Cretaceous        | final period of the Mesozoic era spanning 135 to 65 million years before the present                                                    
|Cu                | chemical symbol for copper                                                                                                              
|dacite            | a fine-grained extrusive rock with more potassium and sodium than andesite                                                              
|enargite          | a grayish-black mineral, composed of copper, arsenic and sulfur (Cu3AsS4)                                                               
|Eocene            | the second epoch of the Tertiary period spanning 58 and 37 million years before present                                                 
|feldspar          | a major rock forming silicate mineral                                                                                                   
|gossan            | an iron-bearing weathered product overlying a sulphide deposit                                                                          
|granite           | an igneous rock consisting of quartz and orthoclase with hornblende or biotite as mafic constituents                                    
|granodiorite      | a plutonic igneous rock consisting of quartz, calcic feldspar, and orthoclase with biotite, hornblende or pyroxene as mafic constituents
|hectare (ha)      | metric unit of area equal to 10,000 square meters (2.471 acres)                                                                         

-5-


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|Glossary of Terms        
|hydrothermal              | a term applied to heated water or fluid                                                                                                                                  
|Induced Polarization (IP) | A method of ground geophysical survey that measures the voltage decay of electrical charge in the Earth following the cessation of an applied current pulse to the Earth.
|Jurassic                  | second period of the Mesozoic era spanning 190 to 135 million years before the present                                                                                   
|mafic                     | applied to an igneous rock having dark-colored minerals (ferromagnesian) containing iron and/or magnesium                                                                
|marcasite                 | light yellow or grayish mineral composed of iron and sulfur (FeS2) resembling pyrite                                                                                     
|mesothermal               | conditions of ore deposition of intermediate temperatures and depths                                                                                                     
|Mesozoic                  | era of geologic time spanning 245 to 66 million years before the present                                                                                                 
|mineral tenure number     | number assigned by Provincial, Territorial or State authorities to mineral claims                                                                                        
|minerals                  | a homogeneous naturally occurring chemical substance                                                                                                                     
|net smelter return (NSR)  | the proceeds received from a smelter or refinery after the deduction of processing, shipping costs and related costs                                                     
|ore                       | a mineral or aggregate of minerals which can be mined at a profit                                                                                                        
|monzonite                 | plutonic rocks intermediate between syenite and diorite containing approximately equal amounts of alkali feldspar and plagioclase                                        
|orthogneiss               | a metamorphic rock derived from gneiss                                                                                                                                   
|PIMA                      | Portable infrared mineral analyzer (spectrometer) that can be used for qualitative identification of minerals in the field                                               
|plutonic rocks            | igneous rocks formed below the earths surface                                                                                                                           
|porphyry                  | an igneous rock of any composition that contains conspicuous crystals in a fine-grained groundmass                                                                       
|ppm                       | abbreviation for units of measure in parts per million                                                                                                                   
|pyrite                    | a mineral composed of iron and sulfur (FeS2)                                                                                                                             
|rhyolite                  | extrusive igneous rocks with high potassium and silica content                                                                                                           
|tetrahedrite              | a steel-gray to iron-black isometric mineral composed of copper, antimony and sulfur (Cu112Sb4S13)                                                                       
|Triassic                  | the first period of the Mesozoic era thought to have covered a span of time between 245 and 208 million years before the present                                         

-6-


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|----------------- | -----------------------------------------------------------------------------------------------------------------------------------------------------
|Glossary of Terms
|tuff              | a general term for all consolidated rocks formed by volcanic explosion or aerial expulsion from a volcanic vent                                      
|tungsten          | a metallic element with the chemical symbol W                                                                                                        
|UTEM              | University of Toronto Electromagnetic System used to measure variances in ground conductivity which may indicate the presence of mineralized material
|VHMS              | volcanic-hosted massive sulphide  a style of mineral deposit thought to have been emplaced on ancient seafloor                                      
|VLF-EM            | very low frequency electromagnetic survey used to identify variances in ground conductivity which may indicate the presence of mineralized material  

-7-  FORWARD-LOOKING STATEMENTS   This Transition Report contains forward looking statements within the meaning of the U.S. Private Securities Litigation Reform Act of 1995. Certain statements in this Report constitute forward looking statements. These forward looking statements are not guarantees of the Corporations future operational or financial performance and are subject to risks and uncertainties. When used in this Transition Report, the words estimate, intend, expect, anticipate and similar expressions are intended to identify forward-looking statements. Readers are cautioned not to place undue reliance on these statements, which speak only as of the date of this Transition Report. These statements are subject to risks and uncertainties that could cause results to differ materially from those contemplated in such forward-looking statements.  Actual operational and financial results may differ materially from the Corporations expectations contained in the forward looking statements as a result of various factors, many of which are beyond the control of the Corporation. These factors include, but are not limited to, the need for additional financing to fully execute the Corporations business plan, the risk factors as set forth in more detail in Item 3 - Key Information - Risk Factors, adverse technical factors associated with exploration and development of the Corporations properties, changes in Canadian or U.S. tax or other laws or regulations, and material changes in capital expenditures.  All mineral resources referenced in this transition report on Form 20-F have been estimated in accordance with the definition standards on mineral resources and mineral reserves of the Canadian Institute of Mining, Metallurgy and Petroleum referred to in NI 43-101. U.S. reporting requirements for disclosure of mineral properties are governed by the SEC Industry Guide 7 ("Guide 7"). NI 43-101 and Guide 7 standards are substantially different. The terms "mineral reserve", "proven mineral reserve" and "probable mineral reserve" are Canadian mining terms as defined in accordance with NI 43-101. These definitions differ from the definitions of "proven (measured) reserves" and "probable (indicated) reserves" in Guide 7. Under Guide 7 standards, a "final" or "bankable" feasibility study is required to report reserves, the three-year historical average price is used in any reserve or cash flow analysis to designate reserves and the primary environmental analysis or report must be filed with the appropriate governmental authority.  This transition report on Form 20-F may include the terms "mineral resource," "indicated mineral resource" and "inferred mineral resource". We advise investors that these terms are defined in and required to be disclosed by NI 43-101. However, these terms are not defined terms under Guide 7 and are normally not permitted to be used in reports and registration statements filed with the SEC. Investors are cautioned not to assume that any part or all of mineral deposits in these categories will ever be converted into reserves. "Inferred mineral resources" have a great amount of uncertainty as to their existence and economic and legal feasibility. It cannot be assumed that all or any part of an inferred mineral resource will ever be upgraded to a higher category. Under Canadian rules, estimates of inferred mineral resources may not form the basis of feasibility or pre-feasibility studies, except in rare cases. Investors are cautioned not to assume that all or any part of an inferred mineral resource exists or is economically or legally mineable.  Please consult the Corporation's public filings at www.sedar.com and www.sec.gov for further, more detailed information concerning these matters.  -8-


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|        | TABLE OF CONTENTS                                                      |     
|        |                                                                        |     
|        | PART I                                                                 | Page
|        |                                                                        |     
|ITEM 1  | IDENTITY OF DIRECTORS, SENIOR MANAGEMENT AND ADVISERS
Not amended      | 10  
|ITEM 2  | OFFER STATISTICS AND EXPECTED TIMETABLE
Not amended                    | 10  
|ITEM 3  | KEY INFORMATION                                                        | 10  
|ITEM 4  | INFORMATION ON THE CORPORATION                                         | 23  
|ITEM 5  | OPERATING AND FINANCIAL REVIEW AND PROSPECTS                           | 71  
|ITEM 6  | DIRECTORS, SENIOR MANAGEMENT AND EMPLOYEES
Not amended                 | 81  
|ITEM 7  | MAJOR SHAREHOLDERS AND RELATED PARTY TRANSACTIONS
Not amended          | 92  
|ITEM 8  | FINANCIAL INFORMATION                                                  | 95  
|ITEM 9  | THE OFFER AND LISTING
Not amended                                      | 95  
|ITEM 10 | ADDITIONAL INFORMATION
Not amended                                     | 97  
|ITEM 11 | QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
Not amended | 109 
|ITEM 12 | DESCRIPTION OF SECURITIES OTHER THAN EQUITY SECURITIES
Not amended     | 112 

-9-


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|         | TABLE OF CONTENTS                                                                        |     
|         |                                                                                          |     
|         | PART II                                                                                  | Page
|         |                                                                                          |     
|ITEM 13  | DEFAULTS, DIVIDEND ARREARAGES AND DELINQUENCIES
Not amended                              | 113 
|ITEM 14  | MATERIAL MODIFICATIONS TO THE RIGHTS OF SECURITY HOLDERS AND USE OF PROCEEDS
Not amended | 113 
|ITEM 15  | CONTROLS AND PROCEDURES
Not amended                                                      | 113 
|ITEM 16A | AUDIT COMMITTEE FINANCIAL EXPERT
Not amended                                             | 114 
|ITEM 16B | CODE OF ETHICS
Not amended                                                               | 115 
|ITEM 16C | PRINCIPAL ACCOUNTANT FEES AND SERVICES
Not amended                                       | 115 
|ITEM 16D | EXEMPTION FROM THE LISTING STANDARDS FOR AUDIT COMMITTEES
Not amended                    | 116 
|ITEM 16E | PURCHASES OF EQUITY SECURITIES BY THE ISSUER AND AFFILIATED PURCHASERS
Not amended       | 116 
|ITEM 16F | CHANGE IN REGISTRANTS CERTIFYING ACCOUNTANT
Not amended                                 | 116 
|ITEM 16G | CORPORATE GOVERNANCE
Not amended                                                         | 120 




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|------- | -------------------------------- | ---
|        | PART III                         |    
|        |                                  |    
|ITEM 17 | FINANCIAL STATEMENTS             | 120
|ITEM 18 | FINANCIAL STATEMENTS
Not amended | 120
|ITEM 19 | EXHIBITS                         | 121
|        |                                  |    

-10-  PART I     ITEM 1   IDENTITY OF DIRECTORS, SENIOR MANAGEMENT AND ADVISERS    Not Applicable.  ITEM 2   OFFER STATISTICS AND EXPECTED TIMETABLE Not Applicable.   ITEM 3   KEY INFORMATION CURRENCY AND EXCHANGE RATES  All dollar amounts set forth in this report are in Canadian dollars, except where otherwise indicated. The following tables set forth:  (i) the average rates of exchange between the Canadian dollar and the U.S. dollar for each of the five most recent financial years of Kiska Metals Corporation (hereinafter Kiska or the Corporation), calculated by using the average of the exchange rates on the last day of each month during the period; and  (ii) the high and low daily exchange rate for each month during the previous six months,  in each case based on the closing exchange rate for U.S. dollars as published on the Bank of Canada website (http://www.bankofcanada.ca/en/rates/exchange-look.html).


|                               |         |         |         |         |        
|------------------------------ | ------- | ------- | ------- | ------- | -------
|Fiscal Year ended 
December 31 | 2009    | 2008    | 2007    | 2006    | 2005   
|Average Rate During Period     | $0.8760 | $0.9338 | $0.9376 | $0.8844 | $0.8284




|          |              |               |              |               |               |             
|--------- | ------------ | ------------- | ------------ | ------------- | ------------- | ------------
|          | March 2010   | February 2010 | January 2010 | December 2009 | November 2009 | October 2009
|High Rate | $     0.9898 | $ 0.9611      | $    0.9771  | $    0.9580   | $    0.9565   | $    0.9748 
|Low Rate  | 0.9601       | $ 0.9307      | 0.9352       | 0.9343        | 0.9278        | 0.9221      

On March 31, 2010, the closing rate as published on the Bank of Canada website was $0.9845 US = $1.00 CDN.   -11-  SELECTED FINANCIAL DATA  The selected consolidated financial information set out below has been obtained from financial statements which reflect the Corporation's operations in the mineral exploration business.  On August 5, 2009, Kiska Metals Corporation (formerly Geoinformatics Exploration Inc. ("Geoinformatics) and its wholly-owned subsidiaries (collectively the Corporation or Kiska) completed the 100% acquisition of Rimfire Minerals Corporation (Rimfire). The Company expects there will be synergies in exploration in those areas where both Geoinformatics and Rimfire were active, and a reduction of overhead costs by combining the companies. As a result of the acquisition, the consolidated statements of operations and comprehensive loss and cash flows for the year ended December 31, 2009 includes the results of operations and cash flows of Geoinformatics until August 5 and the combined entity from August 6 to December 31, 2009. The comparative consolidated annual statements of operations and comprehensive loss and cash flows for the years ended December 31, 2008 and 2007 include only the results of operations and cash flows of Geoinformatics in accordance with generally accepted accounting principles for business combinations. The summary information presented below for years ended 2005 to 2008 contains information only for Geoinformatics. Comparative consolidated annual financial statement information for Rimfires three most recent fiscal years and summary information for Rimfires five most recent fiscal years, as disclosed under Item 3 are available in the annual report on Form 20-F filed on EDGAR by Rimfire (now the Corporation) effective May 8, 2009.  The following table summarizes information pertaining to operations of the Corporation for the last five fiscal years.


|                                                        |                 |                 |                 |                 |                
|------------------------------------------------------- | --------------- | --------------- | --------------- | --------------- | ---------------
|                                                        | Year
Ended
2009 | Year
Ended
2008 | Year
Ended
2007 | Year
Ended
2006 | Year
Ended
2005
|Mineral Property Revenue                                | $      273,051  | $      897,315  | $   1,358,045   | $  1,728,740    | $ 3,094,127    
|Net Loss                                                | (18,684,503)    | (16,260,741)    | (14,474,635)    | (9,868,724)     | (5,028,352)    
|Per Share                                               | (0.51)          | (1.84)          | (3.73)          | (3.25)          | (2.17)         
|                                                        |                 |                 |                 |                 |                
|Current Assets                                          | 1,848,613       | 1,293,202       | 7,620,730       | 7,245,835       | 4,330,882      
|Mineral Property Interests                              | -               | -               | -               | -               | -              
|Other Assets                                            | 479,282         | 1,352,141       | 2,034,642       | 531,545         | 517,107        
|Total Assets                                            | 2,327,895       | 2,645,343       | 9,655,372       | 7,777,380       | 4,847,989      
|Current Liabilities                                     | 284,751         | 641,071         | 1,663,823       | 1,342,480       | 1,360,387      
|Long-Term Liabilities                                   | 401,391         | -               | 16,914,189      | 9,082,066       | 105,649        
|Shareholders Equity                                    | 1,641,753       | 2,004,272       | (8,922,640)     | (2,647,166)     | 3,381,953      
|                                                        |                 |                 |                 |                 |                
|Weighted Average 
Shares Outstanding
(number of shares) | 36,876,491      | 8,831,930       | 3,859,409       | 3,033,247       | 2,314,312      

The Corporations financial statements have been prepared in accordance with accounting principles generally accepted in Canada. Except as disclosed in Note 18 of the financial statements, the financial statements conform in all material respects with U.S. GAAP.   -12-  CURRENT CANADIAN ACCOUNTING CHANGES  Section 3064  Goodwill and Intangible Assets  The Canadian Institute of Chartered Accountants (CICA) has issued Handbook Section 3064, Goodwill and Intangible Assets, which replaced Section 3062, Goodwill and Intangible Assets. The new standard is applicable for interim and annual financial statements relating to fiscal years beginning on or after October 1, 2008. Section 3064 establishes revised standards for the recognition, measurement, presentation and disclosure of goodwill subsequent to its initial recognition, and of intangible assets. Section 3064 also provides guidance for the treatment of preproduction and start-up costs and generally requires that these costs be expensed as incurred. The Corporation adopted Section 3064 as of January 1, 2009, and its adoption had no impact on the Corporations consolidated financial statements.  Business Combinations  Section 1582  In January 2009, the CICA issued Handbook Section 1582, Business Combinations, which will provide the Canadian equivalent to International Financial Reporting Standards (IFRS) 3, Business Combinations and replace the existing Handbook Section 1581, Business Combinations. The new standard will apply prospectively to business combinations for which the acquisition date is on or after January 1, 2011. Earlier adoption is permitted as of the beginning of a fiscal year, in which case an entity would also be required to early adopt Handbook Section 1601, Consolidated Financial Statements and Handbook Section 1602, Non-controlling Interests. The Corporation adopted these sections as of January 1, 2009, and accounted for its acquisition of Rimfire in accordance with Section 1582.  Consolidated Financial Statements  Section 1601  In January 2009, the CICA also issued Handbook Section 1601, Consolidated Financial Statements, which establishes standards for the preparation of consolidated financial statements and, along with Section 1602, will replace the existing Handbook Section 1600, Consolidated Financial Statements. The new standard is effective for interim and annual financial statements relating to fiscal years beginning on or after January 1, 2011. Earlier adoption is permitted as of the beginning of a fiscal year, in which case an entity would also be required to early adopt Handbook Section 1582, Business Combinations and Handbook Section 1602, Non-Controlling Interests.  The Corporation adopted these sections as of January 1, 2009, and the adoption of Section 1601 had no impact on the Corporations consolidated financial statements.  Non-Controlling Interests  Section 1602  In January 2009, the CICA also issued Handbook Section 1602, Non-Controlling Interests, which establishes standards for accounting for a non-controlling interest in a subsidiary in consolidated financial statements subsequent to a business combination. It is equivalent to the corresponding provisions of International Accounting Standard IAS 27, Consolidated and Separate Financial Statements. The new standard is effective for interim and annual financial statements relating to fiscal years beginning on or after January 1, 2011. Earlier adoption is permitted as of the beginning of a fiscal year, in which case an entity would also be required to early adopt Handbook Section 1582, Business Combinations and Handbook Section 1601, Consolidated Financial Statements. The Corporation adopted these sections as of January 1, 2009, and the adoption of Section 1602 had no impact on the Corporations consolidated financial statements.   -13-  Credit Risk and Fair Value of Financial Assets and Financial Liabilities  EIC 173  In January 2009, the Emerging Issues Committee (EIC) of the CICA issued Emerging Issues Committee Abstract 173, Credit Risk and the Fair Value of Financial Assets and Financial Liabilitieswhich provides guidance on the implications of credit risk in determining the fair value of an entitys financial assets and financial liabilities. The guidance clarifies that an entitys own credit risk and the credit risk of counterparties should be taken into account in determining the fair value of financial assets and financial liabilities, including derivative instruments, for presentation and disclosure purposes. The Corporations fair value disclosures incorporate this new guidance.  Accounting Changes  Section 1506  In June 2009, the CICA amended Handbook Section 1506 Accounting Changes. The amendment excludes changes in accounting policies upon the complete replacement of an entitys primary basis of accounting, as will occur when an entity adopts IFRS for the first time, from the scope of Section 1506.  Financial Instruments - Disclosures  Section 3862  In June 2009, the CICA also amended Handbook Section 3862, Financial Instruments  Disclosures to provide the Canadian equivalent to amendments made to IFRS 7, Financial Instruments: Disclosures. The amendments require enhanced disclosure requirements, which include:  · classifying and disclosing fair value measurements based on a three-level hierarchy · Level 1  inputs are unadjusted quoted prices in active markets for identical assets or liabilities; · Level 2  inputs other than quoted prices in Level 1 that are observable for the asset or liability, either directly or indirectly; and · Level 3  inputs for the asset or liability that are not based on observable market data. · reconciling beginning balances to ending balances for Level 3 measurements · identifying and explaining movements between levels of the fair value hierarchy · providing a maturity analysis for derivative financial liabilities based on how the entity manages liquidity risk, and · disclosing the remaining expected maturities of non-derivative financial liabilities if liquidity risk is man­aged on that basis.  These amendments are applicable to financial statements for fiscal years ending after September 30, 2009 and comparative information is not required in the year these amendments are first implemented. Applicable disclosures have been included in Note 5 to the consolidated financial statements.  Equity  Section 3251  In August 2009, the CICA issued amendments to Handbook Section 3251, Equity as a consequence of issuing Section 1602, Non-controlling Interests. The amendments require non-controlling interests to be recognized as a separate component of equity.   -14-  The new standard is effective for interim and annual financial statements relating to fiscal years beginning on or after January 1, 2011. Earlier adoption is permitted as of the beginning of a fiscal year, in which case an entity would also be required to early adopt Handbook Section 1602, Non-Controlling Interests. The Corporation adopted these sections as of January 1, 2009, and their adoption had no impact on the Corporations consolidated financial statements.  Financial Instruments  Recognition and Measurement  Section 3855  In August 2009, the CICA also amended Handbook Section 3855,Financial Instruments  Recognition and Measurement, bringing greater consistency between Canadian GAAP, IFRS and US GAAP on the timing of impairment recognition for debt instruments. Companies that have classified financial assets as held-to-maturity investments are now required to assess those financial assets using the impairment requirements of Handbook Section 3025,Impaired Loans. Section 3025 was consequentially amended to accommodate the changes to Section 3855. The amendments allow more debt instruments to be classified as loans and receivables. This allows those instruments to be evaluated for impairment using Section 3025. In addition, the amendments require reversal of previously recognized impairment losses on available-for-sale financial assets in specified circumstances and require that loans and receivables that an entity intends to sell immediately or in the near term be classified as held for trading. These amendments did not affect the recognition or measurement of the Corporations financial instruments.  FUTURE ACCOUNTING CHANGES:  Convergence with International Financial Reporting Standards  In 2006, the Accounting Standards Board of the CICA ratified a strategic plan that will result in Canadian GAAP, as used by public companies, evolving and being converged with International Financial Reporting Standards over a transitional period currently expected to be completed by 2011. The International Accounting Standards Board currently has projects underway that should result in new pronouncements which will be included in the convergence process.  The Corporation is in the process of completing a detailed assessment of the requirements of the transition to IFRS, with the intention of identifying: (i) the timing of the implementation of the transition, (ii) major differences from existing accounting policies (iii) new accounting policies which are appropriate for the Corporation, (iv) the appropriate disclosures in financial statements prepared under IFRS and (v) developing an implementation plan.  RECENT UNITED STATES ACCOUNTING PRONOUNCEMENTS  Standards Codification Financial Accounting Standards Board (FASB) has published the Accounting Standards Codification which supersedes all previous US GAAP pronouncements for interim and annual financial periods ending after September 15, 2009. The references to the standards are changed to new codified standards (ASC) but do not affect the actual application of US GAAP for the Corporation. The following discussion focuses on differences between Canadian GAAP and US GAAP which affect presentation of financial Information for the Corporation. The following tables summarize the difference in the consolidated statements of operations and the consolidated balance sheets.   -15-  ASC 805 Business Combinations (FAS141R)  This standard establishes principles and requirements for how the acquirer (1) recognizes and measures in its financial statements the identifiable assets acquired, the liabilities assumed and any non-controlling interest in the acquiree, (2) recognizes and measures the goodwill acquired in the business combination or a gain from a bargain purchase, and (3) determines what information to disclose to enable users of the financial statements to evaluate the nature and financial effects of the business combination.  This standard is to be applied prospectively to business combinations for which the acquisition date is on or after the beginning of the first reporting period after December 15, 2008.  This standard is consistent with the CICA Handbook Section 1582, Business Combinations, which the Corporation adopted during the year.  ASC 815 Derivatives and Hedging (FAS161)  This standard was issued in March 2008 and is effective for financial statements issued for fiscal years beginning after November 15, 2008, with early adoption encouraged.  The intent is to improve financial instruments standards for derivative instruments and hedging activities by requiring enhanced disclosures to enable investors to better understand their effects on an entitys financial position, financial performance, and cash flows. Since the Corporation does not apply hedge accounting and has no derivatives, the adoption of this standard has no material impact on the Corporations financial statement presentation.  ASC 855 Subsequent Events (FAS165)  The standard sets out the period after the balance sheet date during which management should evaluate events that occur for potential recognition or disclosure in the financial statements. An entity should apply the requirements of this statement to interim and annual financial periods ending after June 15, 2009. The adoption of this standard has no material impact on the Companys financial statement presentation.  ACCOUNTING STANDARDS UPDATES ("ASU")  ASU2010-06 Fair Value Measurements and Disclosures  The new disclosure requirements regarding inputs and valuation techniques for Level 2 fair value measurements are effective for interim and annual reporting periods beginning after December 15, 2009, and are consistent with IFRS 7 Financial Instruments: Disclosures. The Corporation uses Level 1 inputs (Quoted prices in active market) for determination of fair value of available-for-sale securities. The Corporation uses Level 2 inputs (significant observable inputs) to estimate the fair value of incentive stock options when determining compensation expense to be recognized. It is not anticipated that there will be a change in the nature of inputs or in the valuation techniques applied so there will be no material impact on the Corporation's financial statements. The Corporation is assessing the required disclosure to prepare for implementation for the first interim period of the fiscal year ending December 31, 2010.   -16-  ASU2010-02 Consolidation  This standard update addresses recognition of changes in a parents ownership interest in a subsidiary and is effective for interim and annual reporting periods beginning after December 15, 2009. The standard requires that all changes which occur while the parent retains its controlling financial interest in the subsidiary shall be accounted for as equity transactions with no gain or loss recognized in either consolidated net income or comprehensive income. The Corporation is assessing the impact of this update on the financial statements.  OTHER DIFFERENCES BETWEEN CANADIAN AND UNITED STATES ACCOUNTING STANDARDS  Flow  through shares (SFAS 109  ASC740-10)  Under Canadian income tax legislation, the Company is permitted to issue shares whereby the Company agrees to incur qualifying expenditures and renounce the related income tax deductions to the investors. Under Canadian GAAP, the Company has recorded the full amount of the proceeds received on issuance as share capital.  Upon renouncing the income tax deductions, share capital is reduced by the amount of the future income tax benefits recognized.  Under U.S. GAAP, the recognition of this future income tax benefit is limited to the extent that the issue price of the flow-through shares exceeds the fair value of the Companys shares on the date that the flow-through shares are sold.  Mineral Property Acquisition Costs  The Company's accounting policy under Canadian GAAP is to expense the acquisition of mineral properties as incurred until there are identifiable reserves on a property, when they will be capitalized and amortized over production from the property. With the introduction of Emerging Issues Task Force (EITF) Abstract 04-2, effective April 30, 2004, now contained within ASC 930-805, mineral property acquisition costs are capitalized under U.S. GAAP, unless there is evidence that they are impaired and not recoverable, when they are written off.  The following table shows the effect of these differences on the summary financial information:


|                           |                 |                 |                 |                 |                
|-------------------------- | --------------- | --------------- | --------------- | --------------- | ---------------
|                           | Year
Ended
2009 | Year
Ended
2008 | Year
Ended
2007 | Year
Ended
2006 | Year
Ended
2005
|Net Loss                   | $(18,177,376)   | $(17,112,758)   | $(15,771,997)   | $(1,808,564)    | $(1,454,655)   
|Loss Per Share             | (0.49)          | (1.94)          | (4.09)          | (0.60)          | (0.63)         
|Mineral Property Interests | 1,159,723       | 652,596         | 493,626         | 295,106         | 129,586        
|Total Assets               | 3,487,618       | 3,297,939       | 10,148,978      | 8,072,486       | 4,977,575      
|Shareholders Equity       | 2,801,476       | 2,656,868       | (8,429,034)     | (2,352,060)     | 3,511,539      

CAPITALIZATION AND INDEBTEDNESS  Not Applicable.   -17-  REASONS FOR THE OFFER AND USE OF PROCEEDS  Not Applicable.  RISK FACTORS  The Corporation is engaged in the business of preliminary or early stage mineral exploration and mine development. The Corporation holds no interests in any producing mines or commercial ore deposits. The Corporation is subject to many of the material risks customarily encountered by early stage exploration and mine development companies. Additional risks are included which are specific to the operations and business plan of the Corporation.  Specific Corporate Risks  Competitive Conditions  The mineral exploration and development business is highly competitive. Kiska competes with numerous other companies and individuals in the acquisition, exploration, financing and development of mineral properties. Many of these companies are larger and better capitalized than Kiska. The Corporations competitive position depends on its ability to successfully fund and economically explore, acquire and develop new and existing mineral properties. The Corporation seeks to differentiate itself by making use of a variety of innovative targeting and exploration technologies. The risk of direct competition may be mitigated by Kiska technological capabilities, however, others could adopt or may have adopted these strategies. This competition is not only for the acquisition of mining interests, but also for retention of the services of qualified employees. The Corporation seeks to provide a supportive working environment which will foster a cooperative team atmosphere to attract and retain high caliber employees for all positions.  Employment Contracts/Reliance Upon Officers  The Corporation is largely dependent upon the personal efforts and abilities of its corporate officers. The loss or unavailability to the Corporation of these individuals may have a materially adverse effect upon the Corporation's business. Investors will be relying on management's judgment with respect to the operation of the Corporation. The Corporation does not presently have "key person" life insurance on the lives of any of its officers. (See Item 6 "Directors, Senior Management and Employees").  The services of David A. Caulfield, Director, Business Development, are provided to the Corporation pursuant to a January 1, 2010 management agreement with Equity Exploration Consultants Ltd., incorporated herein by reference to Exhibit 4.30 of this Form 20-F. (See Item 6 "Directors, Senior Management and Employees").   -18-  Conflict of Interest  Certain of the directors of the Corporation are also directors and officers of other corporations engaged in the business of mineral exploration, mine development or resource investment. It is possible that a conflict of interest may arise between their duties as a director of the Corporation and their duties as a director or officer of other corporations. All such conflicts of interest must be disclosed by a director under Yukon corporate law and a director must act in the best interest of both corporations. A director in such a conflict of interest position must abstain from voting on all resolutions with respect to the two competing corporations. (See Item 6: Certain Affiliations)  Legal Proceedings Against Foreign Directors  The Corporation is incorporated under the laws of the Yukon Territory, Canada, and five of the Corporations seven directors and all of its officers are residents of Canada. Consequently, it may be difficult for United States investors to effect service of process within the United States upon the Corporation or upon those directors or officers who are not residents of the United States, or to realize in the United States upon judgments of United States courts predicated upon civil liabilities under the United States Securities Exchange Act of 1934, as amended. Furthermore, it may be difficult for investors to enforce judgments of the U.S. courts based on civil liability provisions of the U.S. federal securities laws in a Canadian court against the Corporation or any of the Corporations non-U.S. resident executive officers or directors. There is substantial doubt whether an original lawsuit could be brought successfully in Canada against any of such persons or the Corporation predicated solely upon such civil liabilities.  Shareholder Dilution  The Corporation raises working capital funds primarily through the sale of its common shares from treasury. An investors proportional interest in the Corporation will decrease over time as additional common shares are issued. In the current economic climate, necessary financing may have to be carried out at lower prices per share than the Corporation would prefer. The Corporation has carefully prepared budgets for planned exploration programs and will pursue financing at the highest available price to minimize this dilution.  Classification as a Passive Foreign Investment Company  The Corporation believes it is a Passive Foreign Investment Company (PFIC), as that term is defined in Section 1297 of the Internal Revenue Code of 1986, as amended, and believes it will continue to be a PFIC for the coming fiscal year. Consequently, this classification may result in adverse tax consequences for U.S. holders of the Corporations shares. For an explanation of these effects on taxation, see Item 10, Taxation. U.S. shareholders and prospective holders of the Corporations shares are also encouraged to consult their own tax advisers.   -19-  General Exploration and Mining Risks  Stage of Development  The Corporation has no production revenue. It does not have an operating history upon which investors may rely. Moreover, the Corporation has no commercially viable properties at this time.  Capital Expenditures; Need for Future Financing  The Corporation has limited financial resources. Sufficient funding for future exploration and development of its properties or to fulfill its obligations under current agreements may not be available when and as required. Failure to obtain such future financing will result in delay or indefinite postponement of further exploration and development of its projects. Failure to obtain such future financing will also result in default under certain of the current agreements and the Corporation will forfeit its interest in such properties. The Corporations accumulated deficit as at December 31, 2009 was $61,796,434.  Commercial development of any of the Corporations properties will only occur if sufficient quantities of minerals with a sufficient average grade are discovered. If a mineral discovery is made, substantial financial resources will be required to establish ore reserves, develop metallurgical processes to extract metal from the ore and develop mining and processing facilities at a given site. If the Corporation is unable to finance such development on its own, it will be required to sell all or a portion of its interest in such property to one or more parties capable of financing such development.  Resource Estimation Risks  The Corporations mineral resources are estimates, and no assurance can be given that the estimated resources are accurate or that the indicated level of gold, copper or any other mineral will be produced. Such estimates are, in large part, based on interpretations of geological data obtained from drill holes and other sampling techniques. Actual mineralization or formations may be different from those predicted. Further, it may take many years from the initial phase of drilling before production is possible at certain locations, and during that time the economic feasibility of exploiting a discovery may change.  The resource estimation is based on assumed or estimated future metals prices, cut-off grades, operating costs, capital costs, and expenditures and other factors that each may prove to be inaccurate. Therefore the technical report and other studies may prove to be unreliable if the assumptions or estimates do not reflect actual facts and events.  The resource estimation included some economic parameters but relies heavily on geological interpretation of the drill sections and analytical results. A full-scale feasibility study incorporating the processing and recovery described earlier, a mine plan and economic considerations could result in significantly different resources or reserves. Upon application for permits for operation of the mine, additional considerations such as infrastructure requirements and capital expenditures could affect the economic viability of developing the Whistler project into a mine.   -20-  Operating Risks  The exploration and, if warranted, development of mining properties is a high-risk industry. Presently, none of the Corporations properties have a known body of commercial ore. Unusual or unexpected formations, formation pressures, fires, power outages, labor disruptions, flooding, explorations, cave-ins, landslides, and the inability to obtain adequate machinery, equipment or labor are all risks involved in the operation of mines and the conduct of exploration programs.  Volatility in Mineral Prices  The cost of developing gold and other mineral properties is affected by the cost of operations, variations in ore grade, fluctuations in metal markets and the cost of processing equipment. Government regulations regarding prices, taxes, royalties, allowable production, importing and exporting of minerals, land use, land tenure and environmental protection also affect economic viability.  The Corporation cannot control the marketability of the minerals it discovers. Metal prices have fluctuated widely in recent years, and are affected by numerous factors beyond the Corporations control. International economic and political trends, expectations of inflation, currency exchange fluctuations, interest rates, global or regional consumption patterns, speculative activities and worldwide production levels all may affect metal prices.  The trading price of mineral exploration and mining companies is largely influenced by international metal prices. As the Corporation raises funds through the sale of its common shares, a significant decrease in the price of precious and base metals will adversely affect the Corporations ability to fund its operations.  Forfeiture of Mineral Claims  The Corporation holds an interest in a number of exploration properties with respect to which certain cash payments, exploration expenditures and share issuances are required to maintain the Corporations interests in such properties. For those of the Corporations properties acquired through the staking of claims, a failure by the Corporation to incur exploration expenditures or make cash payments to the appropriate government agency in lieu of exploration expenditures will result in the forfeiture of the title to the mining claims back to Alaska, Nevada, New Mexico, Yukon Territory, British Columbia, or New South Wales, Australia, as the case may be. Once forfeited, the areas previously covered by the claims will be available for staking by other parties.  For those of the Corporations properties held under option agreement, if the Corporation does not fulfill its obligations under the terms of any such option agreement, such agreement will terminate and title to the property will revert to the grantor of the original option.  Government policy may impact the Corporations ability to develop mineral exploration properties if protected areas legislation, traditional territory designation or other restrictive land use regulations affecting mineral properties are enacted.   -21-  No Assurance of Titles  The Corporations mineral property interests may be subject to prior unregistered agreements, transfers or native land claims and title may be affected by undetected defects. Substance and continuity of title may also be affected by political instability and the vagaries of law as they exist and are applied in foreign jurisdictions. Surveys have not been carried out on all of the Corporations mineral properties and therefore, in accordance with the laws of the jurisdiction in which such properties are situated, their existence and area could be in doubt.  Foreign Operations  Some of the Corporations mineral property interests are located outside of Canada and are subject to the risks associated with foreign investment, including increases in taxes and royalties, renegotiations of contracts, currency exchange fluctuations and political uncertainty. The Corporations flagship property is located in Alaska, and the majority of expenditures related to the Whistler Project are denominated in United States dollars. Since the Corporations treasury is primarily denominated in Canadian dollars, there is a risk of increased foreign exchange rates increasing the cost of exploration and development. Other foreign currencies are not material to the Corporations activities.  General Operating Risks  Permits and Licenses  The operations of the Corporation require licenses and permits from various governmental authorities. The Corporation may not be able to obtain all necessary licenses and permits that may be required to carry out exploration, development and mining operations at its projects. All properties are presently without any known body of commercial ore.  The Corporation holds interests in 439 claims covering 187,047 hectares in British Columbia, Canada. All of these mineral claims are governed by the Mineral Tenure Act and the Mines Act (British Columbia) and are subject to a required assessment work or cash in lieu of $4.00 per hectare in each of the first 3 years and $8.00 in the fourth and subsequent years after their location dates. As the Corporation has paid all required assessments and filing fees, valid title to the mineral claims is recorded in the name of the Corporation or the Joint Venture partner of each property with the Ministry of Energy and Mines in British Columbia.  The Corporations Boulevard and Wernecke Breccia Properties are located in Yukon Territory, Canada. The Boulevard Property consists of 238 claims and the Wernecke Breccias Property is comprised of 1,926 claims. All of these mineral claims are governed by the Quartz Mining Act and are subject to a required assessment work or cash in lieu of $100 each year. As the Corporation has paid all required assessments and filing fees, valid title to the mineral claims is recorded in the name of the Corporation or the Joint Venture partner.  The Corporations Colorback and Hilltop Properties are located in Nevada. The properties consist of 202 mining claims totaling 4,040 acres. The mineral claims are subject to a Bureau of Land Management claim rental fee of U.S. $140 per claim plus a Lander County renewal fee of U.S. $8.50 per claim plus filing fees. As the Corporation has paid all required claim rental and filing fees, valid title to the mining claims is recorded in the name of the Corporation.   -22-  The Corporations San Juan Property is located in New Mexico. The property consists of 51 mining claims covering 1,020 acres and five mining leases totaling 2,558 acres. The mineral claims are subject to a Bureau of Land Management claim rental fee of U.S. $140 per claim plus filing fees. The leases are subject to annual rental of $10 per acre. As the Corporation has paid all required claim rental and filing fees, valid title to the mining claims is recorded in the name of the Corporation.  The Corporations Goodpaster, Uncle Sam and Whistler Properties are located in Alaska. The properties consist of 2,489 state mining claims totaling 286,400 acres. The mineral claims are subject to a required assessment or cash in lieu of U.S. $2.50 per acre per year. The annual claim rental fees of U.S. $60-. $100 per claim, depending on size and location date, are due in November. As the Corporation has paid all required assessments and filing fees, valid title to the mining claims is recorded in the name of the Corporation with the Alaska Department of Natural Resources.  The Corporations Lachlan Project is located in the State of New South Wales, Australia. The project consists of two Exploration Licenses covering 27,513 hectares. The Exploration Licenses are subject to minimum expenditure requirements of A$20,000 plus A$500 per unit per year. The Corporations Victoria Goldfields project is located in the State of Victoria, Australia. The project consists of three Exploration Licenses covering 86,679 hectares. Valid title to these tenements remains with the vendor.  The Corporations Mexico properties are located in the states of Sonora, Sinaloa and Durango. Each property requires semi-annual payment of tenement taxes that vary depending on the grant date and size of the project. The Corporation has paid all required taxes and completed exploration reports for previous years. Accordingly, valid title to the claims is registered in the name of Minera Geoinformatica S.A. de C.V. with the Directorate General of Mines.  There is currently no mining activity or commercial production from any of the Corporations British Columbia, Yukon, Alaska, Nevada, New Mexico, Mexico or Australia mineral properties.  Share Price Fluctuations, Price Volatility  Securities markets in Canada have experienced a high level of price and volume volatility in recent years, with many resource companies experiencing wide price fluctuations not necessarily related to operating performance or underlying asset values of such companies. The Corporations Common Shares traded between $0.14 and $0.28 during 2006, between $0.12 and $0.30 during 2007, between $0.01 and $0.42 during 2008, between $0.33 and $1.16 during 2009, and between $0.65 and $0.91 during the first quarter of fiscal 2010. It is probable that the Corporations share price and volume will continue to fluctuate materially.  Environmental Regulations  All phases of the Corporations operations are subject to laws and regulations governing exploration, development, tenure, production, taxes, labor standards, occupational health, waste disposal, protection and remediation of the environment, reclamation, site and mine safety, toxic substances and other matters promulgated by government agencies from time to time. Environmental legislation is evolving in a manner which means stricter standards and enforcement, more stringent fines and penalties for non-compliance. Environmental assessments of proposed projects carry a heightened degree of responsibility for the Corporation and its directors, officers and employees. Environmental protection requirements have not had a material effect on the capital expenditures, and competitive position of the Corporation in the current fiscal year and are not expected to have a material effect on the capital expenditures, and  -23-  competitive position of the Corporation in the near future. Future changes in environmental regulation, if any, may adversely affect the Corporations operations.  The Corporations current operations are not expected to be impacted by climate change legislation as the greenhouse gas generated by direct operations is limited. However any future development, with increased carbon footprint, could be negatively affected by climate change legislation. Monitoring and reporting requirements are expected to increase the cost of exploration and development. It would also increase the capital cost of development of the mineral properties.  There is insufficient data to determine if global climate change has affected the Corporations access to mineral properties or suitable weather conditions for exploration programs. None of the Corporations mineral properties have been directly affected by physical impacts such as changes in sea level. Weather is always a factor to be considered in planning an exploration program and none of the programs to date have experienced delays outside of the normal expected range.   ITEM 4   INFORMATION ON THE CORPORATION  HISTORY AND DEVELOPMENT OF THE CORPORATION  The Corporation was incorporated under the Company Act (British Columbia) on March 21, 1980 under the name Goldmax Resource Inc. On October 10, 1996, the Corporation was continued from British Columbia to the Yukon and thereafter underwent a series of name changes: Aegean Gold Inc. (April 26, 1999), Aegean International Gold Inc. (December 8, 1999) and MinRes Resources Inc. (October 20, 2003). On January 28, 2005, Geoinformatics Explorations Limited (GEL) completed a reverse takeover of the Corporation, following which, on February 1, 2005, the name of the Corporation was changed to Geoinformatics Exploration Inc.(Geoinformatics) Pursuant to the reverse takeover, GEL changed its name to 2012860 Ontario Limited and became a wholly-owned subsidiary of Geoinformatics. On August 5, 2009, the Corporation completed the 100% acquisition of Rimfire Minerals Corporation and the name of the Corporation was changed to Kiska Metals Corporation (Kiska).  The Company acquired 100% of Rimfire by issuing 22,365,258 common shares and issuing 1,905,300 options to purchase common shares, for an aggregate fair value of $12,786,175. The fair value of the common shares, amounting to $12,412,717, was based on the bid price of the common shares on the date of acquisition, and the fair value of the options issued, amounting to $373,458, was determined using the Black-Scholes option pricing model using the following weighted average assumptions: volatility of 89%, risk free interest rate of 1.8%, an expected life of 2.7 years, and a dividend yield of 0%.   -24-  The Company accounted for this transaction using the acquisition method. The fair value of the net assets acquired was:  Cash and cash equivalents$     4,463,269Amounts receivable51,918Marketable securities162,630Prepaid expenses and deposits358,058Property, plant and equipment104,188Mineral property interests7,974,288Future income tax assets-Goodwill-Accounts payable and accrued liabilities(282,614)Reclamation obligations(45,562)Consideration paid$   12,786,175  Acquisition costs of $633,875 were expensed and included in consulting and outsourced services ($592,743), general and administrative ($39,864) and marketing services ($1,268) in the Consolidated Statement of Operations for the year ended December 31, 2009. Acquisition costs of $18,000 were included in the current years share issue costs.  There were 56,741,361 common shares issued and outstanding as fully paid and non-assessable as of December 31, 2009. The head office of the Corporation is located at Suite 1350, 650 West Georgia Street, Vancouver, British Columbia, V6B 4N9 and its registered office is located at 200  204 Lambert Street, Whitehorse, Yukon Territory Y1A 3T2.  RECENT HISTORY OF THE CORPORATION Fiscal Year 2006  In August 2006, the Corporation and Kennecott Exploration Company (Kennecott) entered into a Master Strategic Alliance Agreement (the Master Agreement) governing a strategic exploration alliance between the companies with respect to the Corporation using technological expertise to identify, evaluate and prioritize certain exploration drill targets over a minimum two-year period (with potential for renewal of up to three additional years) within a geographical region that covers parts of northern Mexico, the western United States and Canada. The Master Agreement consolidated certain earlier agreements between the Corporation and Kennecott. Under the Master Agreement, the Corporation agreed to spend a minimum of US$20 million over the two-year period to explore and drill at least 30 targets developed by the Corporation, largely from its proprietary analysis of regional geological data, a portion of which had been supplied by Kennecott. The Master Agreement also provided that Kennecott would transfer four targets-of-merit to the Corporation during the initial two-year term of the Master Agreement. The Azulitas property in Sinaloa Province, Mexico was the first target-of-merit to be transferred to the Corporation by Kennecott.  -25-  Under the Master Agreement, the Corporation was responsible to undertake exploration for deposits of base metals, precious metals and uranium, of a size and quality to be of interest to Kennecott. The Master Agreement provided that the properties offered to the Corporation would be subject to Kennecotts reserved royalty and back-in rights. The Master Agreement makes reference to a standardization of back-in rights agreement (Standardization Agreement) effective as of November 4, 2005. The Standardization Agreement modifies the terms and conditions for Kennecott to exercise its back-in rights under a prior agreement. Under the Standardization Agreement, the back-in right on the properties would allow Kennecott to acquire a 51% or 60% interest in the properties and would be exercisable for a limited time following delivery by the Corporation of a positive order of magnitude study, which was to include an estimation of the size and grade of the mineralization on the applicable property. The back-in right to acquire a 51% interest could be exercised by Kennecott by paying to the Corporation a multiple of the qualified expenditures incurred on the property by the Corporation and by Kennecott carrying the property through to a positive pre-feasibility study. Thereafter, Kennecott would be able to increase its interest to 60% by completing a positive feasibility study on the applicable property. If Kennecott elected not to exercise its back-in right, its sole interest in the property would revert to a 2% net smelter return royalty (NSR).  In May 2006, the Corporation finalized a short-term loan facility with GRF for $4.5 million (the Bridge Loan). In August 2006, the Corporation and GRF agreed to increase the Bridge Loan to $10 million and to secure the Bridge Loan with the Corporations Great Basin properties. The extension to and increase of the Bridge Loan was intended to give the Corporation time to fulfill the conditions to the drawdown of the Convertible Facility, which included the completion of a $4 million equity financing by December 31, 2006. The Bridge Loan bore interest at a rate of 6% per annum and was payable quarterly in arrears. The Bridge Loan matured and the principal amount became immediately due and payable (together with any unpaid accrued interest) upon the drawdown of the first tranche under the Convertible Facility which occurred in January 2007.  In August 2006, the Corporation executed formal loan documentation with Geologic Resource Fund LP (GRF) pursuant to which GRF agreed to make available to the Corporation a US$20 million convertible unsecured loan facility (the Convertible Facility), on a secured basis, following the approval by minority shareholders of the Corporation for the Convertible Facility at an annual and special meeting held on June 27, 2006. Advances under the Convertible Facility bore interest at 5% per year and GRF had the option of converting the interest payments to common shares in the capital of the Corporation (the Geoinformatics Shares) at a conversion rate of $0.25 per share during the initial two years and $0.275 per share in the third year. The Corporation used the proceeds from the Convertible Facility to fund its obligations under the Master Agreement and for general working capital purposes.  In November 2006, the Corporation finalized security arrangements, which provided for the security of the Bridge Loan and, subsequently, the Convertible Facility by a limited recourse guarantee from the Corporation indirect subsidiary, Geoinformatics Alaska Exploration, Inc. with recourse limited to certain mineral claims owned by it in the Great Basin region of Nevada.  In December 2006, the Corporation raised $4,272,808 from the issuance of 23,737,820 flow-through units at a price of $0.18 per unit. The proceeds from this financing were used to advance the Corporations Canadian projects.   -26-  Fiscal Year 2007  In January 2007, pursuant to the Master Agreement, Kennecott Canada Exploration Inc., a wholly-owned subsidiary of Kennecott, transferred 11 Crown claim groups to the Corporation and also assigned three option-to-purchase agreements it had entered with private land holders to the Corporation. The subject properties were located in the Thunder Bay area of western Ontario and included the Thunder project which was offered to the Corporation by Kennecott as the second target-of-merit under the terms of the Master Agreement.  Also in January 2007, the Corporation completed an initial drawdown of US$10 million under the Convertible Facility. Proceeds from the initial drawdown were used to satisfy the outstanding amount under the Bridge Loan with GRF and the balance was used to fund obligations under the Master Agreement and for general working capital purposes. In April 2007, the Corporation completed the drawdown of the second tranche of US$10 million under the Convertible Facility with GRF.  In February 2007, the Corporation signed an option agreement with Commander Resources Ltd. (Commander), pursuant to which the Corporation could earn up to an 80% interest in a package of five properties located in the Omineca Mining District in British Columbia, subject to a third-party NSR on a portion of the properties. On February 20, 2008, the Corporation terminated the option agreement with Commander after completing the minimum $750,000 in exploration expenditures in 2007.  In March 2007, the Corporation entered into a strategic alliance agreement (the Laurion Agreement) with Laurion Mineral Exploration Inc. (Laurion) effective March 27, 2007, whereby the Corporation was to provide geological analysis and project management services to explore for nickel-copper-platinum group elements in Ontario in exchange for a combination of cash, shares and share purchase warrants of Laurion. The Laurion Agreement provided that the joint venture was to be funded by Laurion and managed by the Corporation. Under the terms of the Laurion Agreement, the Corporation received 2,000,000 common shares and 1,000,000 purchase share warrants of Laurion.  In June 2007, Kennecott offered the Corporation under the Master Agreement a goldcopper porphyry project (the Whistler Project) for exploration in Alaska. The Whistler Project was transferred to the Corporation at no cost as the third target-of-merit under the Master Agreement and was subject to separate provisions that specified that expenditures made and targets drilled on the Whistler Project would not constitute expenditures or targets toward the Corporation obligations under the Master Agreement.  In July 2007, the Corporation wholly-owned Australian subsidiary, Clancy, completed an initial public offering of its shares. The funds raised by Clancy were used primarily for the further exploration of Clancys copper-gold porphyry projects in New South Wales, Australia. Following completion of the initial public offering, the Corporation retained an approximate 48% equity interest in Clancy.  In August 2007, the Corporation accepted a copper-gold porphyry project near the town of Stockton, Utah, from Kennecott as the fourth target-of-merit required to be conveyed to the Corporation pursuant to the terms of the Master Agreement. However, this project has subsequently been returned to Kennecott.   -27-  Fiscal Year 2008  In July 2008, the Corporation strengthened its ownership position in its La Noria project in Sinaloa, Mexico when Kennecott relinquished its back-in right on the project but retained a 2% NSR as its only interest in the property.  In August 2008, Geologic Resource Partners LLP (GRP) offered to extend a short-term loan (the "2008 Loan") of up to $5.5 million at 12% interest per year on a secured basis to the Corporation to fund the Corporations on-going exploration programs and working capital requirements. The 2008 Loan was to mature in March 2009.  In August 2008, the Corporation entered into binding agreements with GRP with respect to (i) the 2008 Loan, and (ii) a private placement of the Corporation Shares at a price of $0.05 per share for gross proceeds of up to approximately $27 million. As security for the 2008 Loan, the Corporation pledged all of the shares of its material subsidiaries.  The placement was completed in October 2008, following approval by minority shareholders. The Corporation issued 19,552,000 common shares to GRP at a subscription price of $0.15 per share and received net proceeds of $2,521,500 following the repayment of the US$20 million Convertible Facility and amounts drawn down under the 2008 Loan. The remaining funds were used to advance the Whistler Project and for working capital purposes. Also in October 2008, the Corporation issued 1,065,907 shares to GRF in satisfaction of the outstanding interest on the Convertible Facility in the amount of $943,328 for the period January 1, 2008 to October 16, 2008. In December 2008, the Corporation completed a one for ten stock consolidation.  Fiscal Year 2009  During the first quarter of 2009, the Corporation focused on corporate opportunities in an effort to secure future funding for its key projects. It attempted to develop strategic opportunities to improve the Corporations financial position in the short term and to build shareholder value in the longer term. Chief among the objectives was preserving and developing the Corporations key assets and retaining key personnel.  On March 9, 2009, the Corporation negotiated a $2.6 million line of credit with GRP, bearing an annual interest rate of 15% payable on maturity. The line of credit matures on September 30, 2010. On March 27, 2009, the Corporation drew $1 million under the line of credit and on June 8, 2009 drew a further $750,000.  On May 15, 2009, the Corporation and Kennecott entered into a partial termination agreement and a first amendment to the partial termination agreement (collectively, the Partial Termination Agreement), whereby the parties terminated the provisions of the Master Agreement with respect to the requirements to form strategic alliances on possible targets in certain regions. The Master Agreement and Standardization Agreement will still apply to the existing projects and to the areas of interest set out in the Partial Termination Agreement. The Kliyul, Whistler, New Mexico and Mexico projects are the only remaining areas of interest under this agreement.   -28-  On June 11, 2009, the Corporation and Rimfire Minerals Corporation (Rimfire) executed a definitive acquisition agreement (the Acquisition Agreement) to complete a business combination by way of a statutory plan of arrangement. Pursuant to the terms and conditions of the Acquisition Agreement, the Corporation agreed to acquire all of the issued and outstanding common shares of Rimfire at an exchange ratio of 0.87 Geoinformatics Shares per common share of Rimfire (following a consolidation of Geoinformatics Shares on the basis of three (3) old Geoinformatics Shares for one (1) new Geoinformatics Share) and change the name of the Corporation to Kiska Metals Corporation. The Acquisition was completed effective August 5, 2009, following the approval of shareholders from both Kiska and Rimfire. The shareholder meetings were held on July 30, 2009 with shareholders of each company voting overwhelmingly to approve the Acquisition. Rimfire management and staff have been integrated into the Corporation.  On June 12, 2009, the Corporation and Kennecott entered into the first amendment to the Standardization Agreement (the Amended Standardization Agreement). Kennecott and the Corporation decided to amend certain provisions of the Standardization Agreement with respect to the back-in rights of Kennecott on the Whistler Project due to its geographic size. The amendments dealt with, among other things, the formation of a technical committee, the design of the exploration program, the responsibilities for the costs of the exploration program and the delivery of the exploration results, in addition to Kennecotts rights to exercise the back-in-rights with respect to the Whistler Project.  BUSINESS OVERVIEW  The Corporation is a natural resource company engaged in the acquisition and exploration of precious and base metal mineral properties. The Corporation has interests in properties located in Canada, the United States, Australia and Mexico.  The Corporation also has an equity interest in Clancy Exploration Limited (Clancy), which has properties located in Australia. The Corporation used a scientific and technology platform that integrates data aggregation, data mining and processing and three dimensional modeling to identify and prioritize exploration drill targets.  The process has been designed to assist in understanding and quantifying risk at an early stage of the exploration cycle. The Corporation has evolved from a technology service company to an exploration company through its alliances with strategic partners within the mining and exploration industry. Over the past several years, Kiska acquired a portfolio of exploration projects under the Master Agreement with Kennecott. A description of the Corporation's mineral exploration properties is set out below in this Item 4 under the subheading Property, Plants and Equipment.  NONE OF THE MINERAL PROPERTIES IN WHICH THE CORPORATION HOLDS AN INTEREST CONTAIN ANY KNOWN ORE OR MINERAL RESERVES. ALL EXPLORATION PROGRAMS PROPOSED FOR ANY MINERAL PROPERTIES IN WHICH THE CORPORATION HAS AN INTEREST ARE EXPLORATORY IN NATURE.  The Common Shares of the Corporation are listed and posted for trading on the TSX Venture Exchange under the trading symbol KSK.   -29-  The Corporation does not prepare business plans for any of its properties. Business plans are not customarily prepared for mineral exploration programs or properties. As is industry standard, the Corporation will prepare a work program for each of the mineral properties upon which it will carry out exploration work. Although a program is completed within a specified budget, the specific nature and type of exploration work completed may vary from the original work program depending on results obtained during the program.  The Corporation has raised and will continue to raise all but a very minor portion of its future working capital and exploration funds through the sale of its securities from treasury. The Corporation may periodically receive cash payments and securities as property option payments from third parties pursuant to the terms of existing or future option agreements.  The Corporation's long-term goal is to identify high potential mineral properties that have received little if any recent exploration work, enhance their value through initial exploration and market them to joint venture partners. The Corporation plans to maintain significant interests in a number of projects and have joint venture partners raise and spend the money necessary to thoroughly evaluate the potential of such mineral properties.  The Corporations medium term goal is to complete the required exploration program for Kennecotts decision regarding the Whistler program. Completion of the program will provide all the data necessary for Kennecott to decide whether to elect its one-time right to purchase a 51% interest in the Whistler Project by refunding 200% of the projects exploration expenditures and by advancing the project to a positive prefeasibility study. Kennecott can then earn an additional 9% project interest by advancing Whistler to a production decision. The Corporations interest in the property will be carried through this stage.  Prior to commencing any exploration activities in any of Australia, Alaska, Nevada, Yukon or British Columbia, the Corporation or the party intending to carry out a work program on a mineral property is required to apply to the appropriate Mining Division of the State, Territorial or Provincial government for a number of permits or licenses related to mineral exploration activities. These permits or licenses include nomination of operator, water and surface use permits, occupation permits, fire permits, and timber permits. Prior to being issued the various permits or licenses, the applicant must file a detailed work plan with the applicable government agency. Permits are issued on the basis of the work plan submitted and approved by the governing agency. Additional work on a given mineral property or a significant change in the nature of the work to be completed would require an amendment to the original permit or license.  As part of the permit or licensing requirements, the applicant may be required to post an environmental reclamation bond in respect to the work to be carried out on the mineral property. The amount of such bond is determined by the amount and nature of the work proposed by the applicant. The amount of a bond may also be increased with increased levels of development on the property.  The Corporation has or will make application to the appropriate agencies for permits and licenses relating to those properties upon which the Corporation intends to carry out work during the 2010 exploration season. For those mineral properties in which the Corporation has an interest but is not the operator of the work programs, application for the required permits and licenses and the posting of the reclamation bonds will be made by the party entitled to carry out exploration work on the property. The Corporation believes that it is currently in compliance with all applicable environmental laws and regulations in, Australia, Alaska, Nevada, Yukon Territory and British Columbia.  -30-  The Corporation is unaware of any legal proceedings, either threatened or pending, to which the Corporation is or is likely to be a party, or of which any of its properties or assets is or is likely to be the subject, that are material to the business and affairs of the Corporation.  The Corporation does not anticipate any unusual delays or restricted access to mineral properties due to global climate change. Weather is always a factor to be considered in planning an exploration program and none of the programs have experienced delays outside of the normal expected range. Most of the North American mineral properties are located in areas that experience significant low temperatures and snowfall in winter, therefore the exploration season is generally limited to the June-October window of more clement weather. Exploration on the Corporations Mexican and Australian properties can be conducted on a year-round basis. Planning for exploration and compilation of reports on completed programs and new project research continues on a year-round basis.  The table below illustrates the Corporations expenditures on exploration activities for the last three fiscal years. The figures below have been prepared in accordance with generally accepted accounting principles (GAAP) in Canada. Except as explained in Note 18 of the Corporations financial statements, the figures below are consistent with U.S. GAAP.  Year
Ended
2009Year
Ended
2008Year
Ended
2007Exploration Costs$    5,853,537$    7,205,248$   11,664,530Mineral Property Acquisition330,598158,990198,500  Note: All figures shown above are in Canadian Dollars.  The Corporations plan for fiscal 2010 is to complete the required drill and geophysical exploration program on the Whistler program in order to provide sufficient information for Kennecott to make a back-in decision.  The other focus will be to divest the numerous properties in the Corporations portfolio to reduce holding costs while returning some value to the Corporation. The plan is to obtain joint venture partners to continue exploration of the Gillis, Grizzly, Kliyul, Redton, Thorn and Williams properties in BC. The properties in Mexico will be sold or joint-ventured as a group along with the exploration office infrastructure in Hermosillo. The Corporation has assigned the option agreement for the Victoria Goldfields project in Australia and will be operator for the program. There will be drill programs on at least one property with a joint venture partner; however, there is no requirement for the Corporation to finance these exploration programs.  Under the Wernecke Breccia Property agreement, Fronteer Development Group Inc. (Fronteer) has completed their initial earn-in of $2,000,000 in exploration. The Corporation can choose to participate by paying 20% of the expenditures or can choose dilution of ownership based on initial deemed contributions of $2,000,000 by the Corporation and $8,000,000 by Fronteer. Other option agreements are also close to completing their initial earn-in. If and when the initial earn-in is complete, the Corporation will be required to share exploration expenditures with the joint venture partner on a 49/51, or 40/60 basis depending on the option agreements. (See Item 4: Property Plants and Equipment below).  -31-  For the basis of statements made by the Corporation regarding its competitive position, please see the disclosure under Item 3  Risk Factors  Specific Corporate Risks  Competitive Conditions on page 18 of the transition report on Form 20-F.  ORGANIZATIONAL STRUCTURE  The Corporations subsidiaries and their respective jurisdictions consist of the following:


|                                             |                                    |             |             
|-------------------------------------------- | ---------------------------------- | ----------- | ------------
|                                             | Year of incorporation/
acquisition | % Ownership | Jurisdiction
|Geoinformatics Exploration Australia Pty Ltd | 2002                               | 100%        | Australia   
|Rimfire Australia Pty Ltd.                   | 2009                               | 100%        | Australia   
|2012860 Ontario Limited                      | 2002                               | 100%        | Canada      
|Geoinformatics Exploration Canada Limited    | 2005                               | 100%        | Canada      
|Rimfire Minerals Corporation                 | 2009                               | 100%        | Canada      
|Geoinformatics Explorations Ireland Limited  | 2002                               | 100%        | Ireland     
|Minera Geoinformatica S.A de C.V.            | 2004                               | 100%        | Mexico      
|Geoinformatics Alaska Exploration, Inc.      | 2003                               | 100%        | USA         
|GXL USA, Inc.                                | 2007                               | 100%        | USA         
|Rimfire Alaska, Ltd.                         | 2009                               | 100%        | USA         
|Rimfire Nevada Ltd.                          | 2009                               | 100%        | USA         

INTERCORPORATE RELATIONSHIPS  [kiskaannual20fa1001.jpg]  -32-   [kiskaannual20fa1002.jpg]  -33-  PROPERTY, PLANT AND EQUIPMENT  The Corporation is in the exploration stage and its properties are presently without a known body of commercial ore. Its mineral property interests are the following:  · Gillis Property located in the Nicola Mining Division of British Columbia, approximately 30 kilometers south of Merritt, British Columbia.  · Grizzly Property located in the Liard Mining Division of British Columbia, approximately 120 kilometers northwest of Stewart, British Columbia.  · Kizmet Property located in the Atlin Mining Division of British Columbia, approximately 130 kilometers northwest of Telegraph Creek, British Columbia.  · Kliyul Property located in the Omineca Mining Division of British Columbia, approximately 115 kilometers north of Takla Landing, British Columbia.  · Poker Creek Property located in the Liard Mining Division of British Columbia, approximately 16 kilometers west of Telegraph Creek, British Columbia.  · Quesnel Trough Project, consisting of 7 properties, is located in the Cariboo Mining Division of British Columbia, from 15 kilometers south of Prince George to 40 kilometers north of Fort St. James, British Columbia  · RDN Property located in the Liard Mining Division of British Columbia, approximately 120 kilometers northwest of Stewart, British Columbia and 50 kilometers north of the Eskay Creek Mine.  · Redton Property located in the Omineca Mining Division of British Columbia, approximately 140 kilometers northwest of Fort St. James, British Columbia.  · Thorn Property located in the Atlin Mining Division of British Columbia, approximately 120 kilometers northwest of Telegraph Creek, British Columbia.  · Tide Property located in the Skeena Mining Division of British Columbia, approximately 36 kilometers north of Stewart, British Columbia.  · Williams Property located in the Liard Mining Division of British Columbia, approximately 150 kilometers southeast of Dease Lake, British Columbia and 330 kilometers north of Smithers, British Columbia.  · Goodpaster Properties located in the Fairbanks Recording District, Alaska, 65 kilometers northeast of Delta Junction, Alaska.  · Uncle Sam Property located in the Fairbanks Recording District, Alaska, 75 kilometers southeast of Fairbanks, Alaska.  · Whistler Property located in the Anchorage Recording District, Alaska, 160 kilometers northwest of Anchorage, Alaska.   -34-   · Boulevard Property located in Whitehorse Mining District of Yukon Territory, approximately 135 kilometers south of Dawson City, Yukon.  · Wernecke Breccia Property located in the Mayo Mining District of Yukon Territory, approximately 180 kilometers northeast of Mayo, Yukon.  · Colorback/Hilltop Properties located in Lander County Nevada approximately 100 kilometers southwest of Elko, Nevada.  · San Juan Property located in Socorro County New Mexico approximately 45 kilometers southwest of San Antonio, New Mexico  · Barmedman and Walmer properties located in the Lachlan Fold Belt, New South Wales Australia.  · Victoria Goldfields properties located in the Stawell Corridor, Victoria, Australia.  · Nine projects in Sonora, Durango and Sinaloa States in Mexico.  At present, the Corporation does not intend to undertake any exploration at its own expense on the Australia, Boulevard, Goodpaster, Grizzly, Kizmet, Poker Creek, RDN, Redton, Thorn, Tide, Williams, Werneckes, Uncle Sam or Mexico properties for the fiscal year ending December 31, 2010. Option agreements in place require other corporations to complete exploration programs on some of these properties. These are described in more detail in the description of each property in this Item 4 below.  In the event that joint venture partners are not obtained for the remaining properties, the Corporation may pay the required carrying costs from working capital or allow these claims to be returned to the vendor or be forfeited to the State, Province or Territory as the case may be.  The Corporations head office occupies 2,974 square feet of office space sub-leased under agreement with Nexterra Energy. The Corporation has purchased furnishings, computers and office equipment, and leased a photocopier. The rent, as of March 31, 2010, is $10,617 per month. Telephone and internet access charges are in addition to this amount.  The Corporations mineral properties are detailed below.   -35-  Whistler Property, Anchorage Recording District, Alaska  [kiskaannual20fa1003.jpg] Map showing the location of the Whistler Project relative to Anchorage and possible land access routes.  Location and Introduction  The Whistler property, consisting of 869 claims, covering 132,800 acres, is located 160 kilometers northwest of Anchorage, Alaska in the Yentna Mining District of Alaska. The property boundaries have not been legally surveyed. The Whistler Property is owned 100% by the Corporation subject to a one-time back in right by Kennecott and two underlying agreements.  The project is located in the drainage of the Skwentna River. Elevation varies from about 400 metres above sea level in the valley floors to over 5,000 metres in the highest peaks. Access to the project area is solely by aircraft. A base camp is established near Rainy Pass, a lodge serviced with a gravel airstrip for wheel-based aircrafts. The camp is equipped with diesel generators, a satellite communication link and tent structures on wooden floors. Although chiefly used for summer field programs the camp can be winterized.   -36-  Property History  Mineral exploration in the Whistler area was initiated by Cominco Alaska in 1986, and continued through 1989. During this period, the Whistler and the Island Mountain copper-gold porphyry occurrences were discovered and partially tested by drilling. In 1990, Comincos interest waned and all cores from the Whistler region were donated to the State of Alaska. The property was allowed to lapse.  In 1999, Kent Turner staked twenty-five State of Alaska mining claims at Whistler and leased the property to Kennecott. From 2004 through 2006 Kennecott conducted extensive exploration of Whistler region, including geological mapping, soil, rock and stream sediments sampling, ground induced polarization, the evaluation of the Whistler copper-gold occurrence with fifteen core boreholes (7,948 metres) and reconnaissance core drilling at other targets in the Whistler region (4,184 metres). Over that period Kennecott invested over US$6.3 million in exploration. In June 2007, Kennecott offered the Whistler project to the Corporation under the Master Agreement. The Whistler Project was transferred at no cost as the third target-of-merit under the Master Agreement and was subject to separate provisions that specified that expenditures made and targets drilled on the Whistler Project would not constitute expenditures or targets toward Geoinformatics obligations under the Master Agreement. Between July and October 2007, Geoinformatics drilled seven core boreholes (3,321 metres) to infill the deposit to sections spaced at seventy-five metres and to test for the north and south extensions of the deposit. Property Acquisition  The Corporations rights to the Whistler project were acquired from Kennecott in consideration of exploration expenditures totaling a minimum of US$5.0 million over two years subject to two underlying agreements. Kennecott retains certain back-in rights to acquire up to sixty percent of the project.  The first underlying agreement is a Mineral Lease Agreement between Mr. Kent Turner and Kennecott dated July 3, 2003 granting to Kennecott and its successors a renewable 30-year lease on twenty-five unpatented State of Alaska Claims containing the Whistler copper-gold deposit. In consideration of the lease, Kent Turner is entitled to advance annual royalty payments of US$50,000 at the anniversary of the agreement and deductible against a certain production royalty. The agreement also provides for minimum annual exploration expenditures US$100,000 since February 1, 2006.  The second underlying agreement is an earlier agreement between Cominco American Incorporated (now Teck Resources Limited) and Mr. Kent Turner dated October 1, 1999. This agreement concerns a 2% net profit interest held by Teck Resources Limited in connection with the Turner Claims.  During 2009, the Corporation staked an additional 100 claims surrounding the existing claims.   -37-  The following table details the claims that comprise the Whistler property with legal identification (Mineral Tenure) and location.


|                    |                      |                                                  
|------------------- | -------------------- | -------------------------------------------------
|Claim               | Mineral Tenure (ADL) | Location                                         
|BT 001-BT099        | 667647-667745        | Seward M., T.S. 19N-20N, Range 19W-20W           
|IM 1-IM 18          | 645698-646065        | Seward M., T.S. 19N-20N, Range 19W-20W           
|IM 19-IM 24         | 645709-645714        | Seward M., T.S. 20N, Range 19W                   
|IM 25-IM 27         | 646066-646068        | Seward M., T.S. 20N, Range 20W                   
|IM 28-IM 35         | 645715-645722        | Seward M., T.S. 20N, Range 19W                   
|IM 36               | 646069               | Seward M., T.S. 20N, Range 20W                   
|IM 37-IM 42         | 645723-645728        | Seward M., T.S. 20N, Range 19W                   
|IM 43               | 646070               | Seward M., T.S. 20N, Range 20W                   
|IM 44-IM 49         | 645729-645734        | Seward M., T.S. 20N, Range 19W                   
|IM 50               | 646071               | Seward M., T.S. 20N, Range 20W                   
|IM 51-IM 54         | 645735-645738        | Seward M., T.S. 20N, Range 19W                   
|IM 55               | 646072               | Seward M., T.S. 20N, Range 20W                   
|IM 56-IM 59         | 645739-645742        | Seward M., T.S. 20N, Range 19W                   
|IM 60-IM 70         | 646073-646083        | Seward M., T.S. 19N, Range 19W-20W               
|IM 71-IM 128        | 646764-646821        | Seward M., T.S. 20N, Range 19W                   
|MUD 1-MUD 43        | 650959-651001        | Seward M., T.S. 20N-21N, Range 19W-20W           
|MUD 44-MUD 51       | 656421-656428        | Seward M., T.S. 20N, Range 20W                   
|Port 2151-Port-2153 | 633446-633448        | Seward M., T.S. 22N, Range 18W                   
|Port 2251-Port-2253 | 633446-633451        | Seward M., T.S. 22N, Range 18W                   
|Port 2351-Port-2355 | 633452-633456        | Seward M., T.S. 22N, Range 18W                   
|Port 2454-Port-2459 | 633457-633462        | Seward M., T.S. 22N, Range 18W                   
|Port 2555-Port-2559 | 633463-633467        | Seward M., T.S. 22N, Range 18W                   
|Port 2655-Port-2657 | 633468-633470        | Seward M., T.S. 22N, Range 18W                   
|SAM 1  SAM 37      | 667206-667242        | Seward M., T.S. 21N-22N, Range 17W-18W           
|Whisper 1 - 182     | 641197-641319        | Seward M., T.S. 22N-23N, Range 18W-19W           
|Whisper 183         | 644845               | Seward M., T.S. 23N, Range 19W                   
|Whisper 184         | 646084               | Seward M., T.S. 23N, Range 19W                   
|Whisper 185 - 187   | 644846-644848        | Seward M., T.S. 23N, Range 19W                   
|Whisper 188 - 236   | 646085-646133        | Seward M., T.S. 22N-23N, Range 17W,18W,19W       
|Whisper 240 - 250   | 646137-646147        | Seward M., T.S. 22N, Range 17W-18W               
|Whisper 265 - 269   | 646162-646166        | Seward M., T.S. 22N, Range 18W                   
|Whisper 284 - 290   | 646181-646186        | Seward M., T.S. 22N, Range 16W, 18W              
|Whisper 305 - 311   | 646202-646208        | Seward M., T.S. 22N, Range 16W,18W               
|Whisper 326 - 332   | 646223-646229        | Seward M., T.S. 22N, Range 16W,18W               
|Whisper 336  342   | 646233-646239        | Seward M., T.S. 22N, Range 17W                   
|Whisper 347  361   | 646244-646258        | Seward M., T.S. 22N, Range 16W,17W, 18W          
|Whisper 365 - 617   | 646262-646977        | Seward M., T.S. 21N-22N, 
Range 16W,17W, 18W, 19W

-38-  Regional Geology  Alaskan geology consists of a collage of various terranes that were accreted to the western margin of North America as a result of complex plate interactions through most of the Phanerozoic. The southern most Pacific margin is underlain by the ChugachPrince William composite terrane, a Mesozoic-Cenozoic accretionary prism developed seaward from the Wrangellia composite terrane. It comprises arc batholiths and associated volcanic rocks of Jurassic, Cretaceous and early Tertiary age.  The Alaska Range represents a long-lived continental arc characterized by multiple magmatic events ranging in age from about 70 million years (Ma) to 30Ma and associated with a wide range of base and precious metals hydrothermal sulphide-bearing mineralization.  Property Geology  The geology of Whistler project is characterized by a thick succession of Cretaceous to early Tertiary (ca. 97 to 65Ma) volcano-sedimentary rocks intruded by a diverse suite of plutonic rocks of Jurassic to mid-Tertiary age. Five main intrusive suites are important in the Whistler project area.  The Whistler Igneous Suite comprises alkali-calcic basalt-andesite, diorite and monzonite intrusive rocks generally older than 75.5Ma with restricted extrusive equivalent. These intrusions are commonly associated with copper-gold porphyry-style mineralization characterized by low arsenic and low antimony.  The Summit Lake, Kichatna and Hartman River Intrusions (74 to 61Ma) are calc-alkalic granodiorite to diorite intrusions occurring northeast of the Whistler region. These intrusions are generally auriferous and hydrothermal mineralization is commonly arsenical.  The Composite Intrusions vary in composition from peridotite to granite and their ages span from 67 to about 64 Ma. Copper-gold veinlets and pegmatitic occurrences are characteristics of the Composite plutons.  The Crystal Creek Intrusions form a suite of calc-alkalic granite and granite porphyry intrusions with extrusive rhyolite ranging in age from 61 to 65Ma. Andesite and diorite rocks may represent higher level or border phases of this intrusive suite.  The Merrill Pass igneous suite forms a north-trending belt of differentiated calc-alkalic volcanic and intrusive rocks (44 to 30Ma) related to the emergence of the Aleutian arc. They are associated with porphyry copper mineralization and are generally barren.  Mineralization  The Whistler project was acquired by the Corporation for its potential to host magmatic hydrothermal gold and copper mineralization. Magmatic hydrothermal deposits represent a wide spectrum of mineral deposits formed by the circulation of hydrothermal fluids into fractured rocks and associated with the intrusion of magma into the crust. Exploration work completed by Kennecott has uncovered several copper-gold sulphide occurrences exhibiting characteristics indicative of magmatic hydrothermal processes and suggesting that the project area is generally highly prospective for porphyry copper-gold deposits.   -39-  The Whistler copper-gold deposit is the most important exploration target on the Whistler project. Drilling by Cominco, Kennecott and Geoinformatics was successful in delineating copper-gold sulphide mineralization associated with at least three diorite porphyry intrusive phases. The oldest phase exhibits the best copper-gold mineralization, while the third and youngest is typically barren. On surface, the copper gold mineralization extends over an area measuring 750 by 250 metres and from the surface to depths ranging between 200 and 750 metres.  Surface Exploration, Geophysics and Drill Programs  There are partial records documenting sixteen shallow core boreholes (1,677 metres) drilled on the Whistler copper-gold deposit in 1988 and 1989. The records contain descriptions of the core, with drilling logs and assay results. Apparently, the core from these holes was donated to the State of Alaska in 1990. Few details are available for the sampling procedures used by Cominco Alaska (Teck Resources Ltd.).  Kennecott carried out systematic exploration of the project area between 2003 and 2006. This work included reconnaissance mapping and prospecting, airborne geophysical and radiometric surveying, rock, soil and stream sediments sampling, detailed mapping over selected areas and ground Induced Polarization (IP) surveys.  Between 2004 and 2006, Kennecott drilled a total of thirty-five core holes (12,694 metres) on the Whistler project. Fifteen of those core holes (7,948 metres) were drilled on the Whistler deposit. Drilling at Whistler aimed at testing the copper-gold sulphide mineralization on six east-west sections spaced at 150 to 200 metres with inclined boreholes drilled towards the east and the west. Two inclined holes were drilled with a south azimuth to test the depth extension of the sulphide mineralization.  A total of twenty boreholes (4,746 metres) were drilled by Kennecott to investigate other exploration targets. Targets selected for drilling were typically chosen based on a combination of geology, geochemical and geophysical criteria interpreted to be indicative of magmatic hydrothermal processes. The drilling strategy involved testing selected targets with vertical or angled drill holes to validate the geological model. One or more boreholes were drilled, depending on results, in an attempt to vector towards the potassic core of a magmatic hydrothermal system known to be associated with better copper and gold sulphide mineralization in this area.  When the Corporation acquired the Whistler project, a review of project data was completed. A field program was initiated in 2007 consisting of infill drilling at Whistler and follow-up reconnaissance work on other targets in order to prepare them for drilling. In total, seven inclined holes totaling 3,321 metres were drilled in 2007.  Kennecott used industry best practices to collect, handle and assay soil, rock and core samples collected during the period 2004-2006. All assay samples were prepared by the Alaska Assay Laboratory, in Fairbanks, Alaska and assayed at either the Alaska Assay Laboratory (2004) or the accredited ALS-Chemex laboratory in Vancouver, British Columbia. Samples were assayed for gold by conventional fire assay and a suite of elements including the usual metals by aqua regia [and 4-acid] digestion and inductively coupled plasma atomic emission spectroscopy. Kennecott used industry best practices quality control measures during its exploration at Whistler. The Corporation continued exploration using the procedures developed by Kennecott for this project.   -40-  [kiskaannual20fa1004.jpg]  In June 2009, The Corporation negotiated an amended agreement with Kennecott. The Corporation agreed to complete a specified work program with defined amounts of geophysics and drilling on several targets within the Whistler project area. Once the full program is completed, Kennecott will decide whether to exercise its right to back-in or relinquish back-in rights and revert to a royalty. The program will consist of:  - Up to 341 line kilometers of 2D and 3D Induced Polarization geophysics on regional targets. - Drilling of a minimum of 20 holes with a minimum depth of 200m per hole, for at least 7000m in aggregate.  The work program will be supervised by a technical committee comprised of two geoscientists from each of Kiska and Kennecott. In the event of a split decision, final determination lies with Kennecott.   -41-  Upon completion of the program and presentation of a report, Kennecott must either elect to:  - Within 90 days, relinquish its back-in right and revert to a 2% NSR, or - Within 90 days, exercise its back-in right on the project to earn an initial 51% interest by refunding two times Geoinformatics' total qualifying exploration expenditures. Kennecott may then elect to increase its interest to 60% by funding all programs and budgets until the project reaches a development decision, or - Within 30 days, agree to fund a supplemental exploration drill program. Within 30 days of receiving the results from the completed supplemental program, Kennecott must make a final decision on whether to exercise or relinquish its back-in rights as described above. If Kennecott elects to back in after the supplemental program, Kennecott can offset the costs of the supplemental program to a maximum of 6% of two times Geoinformatics' total exploration costs. The supplemental program shall not exceed 180 days.  On August 6, 2009 Kiska commenced a regional IP geophysical survey totaling 341 line-kilometres. The program involved geophysical crews from Aurora Geosciences (Alaska) Ltd. of Anchorage and SJ Geophysics of Vancouver and used a combination of 2D and 3D IP techniques. The 40 line-kilometer 2D portion of the IP survey was completed on September 24th 2009. The 3D portion of the survey was approximately 78% completed when it was suspended in early November due to frozen ground conditions. Kiska undertook the new geophysical surveys to investigate the entire 18 by 9 kilometer Whistler Corridor and to generate a three-dimensional geophysical model of the subsurface for drill target optimization. Data processing and modeling are complete and the three-dimensional geophysical model was integrated with other data by the end of February. This information was used to further refine targets in thin gravel-covered areas to prioritize targets for drilling as part of agreed program during 2010.  A five hole diamond drill program totaling approximately 1500 metres was completed at Whistler during the late 2009 quarter as part of the agreed program. Five targets were tested.  · Lightning - outcropping quartz veins hosted by diorite porphyry located approximately 0.9 kilometers southwest of the Whistler Deposit. No significant results were returned from this hole (WH09-001).  · Raintree West - follow-up on the 2008 discovery where the only hole to-date returned 160 metres averaging 0.59 grams/tonne gold, 6.02 grams/tonne silver, 0.10% copper including 24 meters averaging 1.37 grams/tonne gold, 6.32 grams/tonne silver and 0.13% copper located 1.5 kilometres east of the Whistler Deposit. One hole drilled at this target in 2009 (WH09-002) returned a 471.6 meter intersection that averaged 0.38 grams/tonne gold, 4.7 grams/tonne silver, 0.09% copper, 0.15% lead, and 0.35% zinc (0.93 grams/tonne gold-equivalent). The hole ends in mineralization and this intersection represents the entire length of the hole.  · Digger - a magnetic anomaly approximately 500 meters in diameter with no outcrop exposure located approximately 3.5 kilometres southeast of the Whistler Deposit. Soil sampling results at Digger returned anomalous results comparable to soil sampling over the Whistler Deposit. No significant results were returned from this hole (WH09-003).   -42-   · Island Mountain Breccia - a 150 meter diameter intrusive breccia body hosted by diorite porphyry located approximately 23.5 kilometers southwest of the Whistler Deposit. The first and only hole in this target (IM09-001) returned 0.68 grams/tonne gold over 382.9 meters, including an upper copper and silver-bearing interval and a lower gold-only intersection. The upper interval of 150.0 metres in drilled length averaged 0.72 grams/tonne gold (previously reported), 2.37 grams/tonne silver and 0.16% copper (1.06 grams/tonne gold equivalent). A second interval averaged 1.22 grams/tonne gold, 0.69 grams/tonne silver and 0.05% copper over the bottom 106.9 metres of the drill hole.  · Island Mountain Cirque - an extensive outcrop of gossanous monzonite porphyry located approximately 22 kilometers southwest of the Whistler Deposit. Hole IM09-002 was drilled to test this target returning 0.13 grams/tonne gold over 202.3 metres. Although anomalous in gold over its entire length, the hole was lost due to technical reasons prior to reaching target depth.  Mineral Resource Estimation  In September 2004, Kennecott submitted three composite core samples for metallurgical testing at Dawson Metallurgical Laboratories Inc. in Salt Lake City, Utah. Preliminary test work on the three composite samples included gravity concentration or flotation to recover the copper and gold. Recovery of copper and gold focused on flotation as the process option in later test work.  In general 90% to 92% copper recovery was achieved into a 6% copper rougher concentrate. Also recovered in this concentrate was 80% of the gold at a rougher grade of 20 grams/tonne. These recoveries were accomplished at laboratory flotation times of 5 to 6 minutes and a grind of 80% passing 162 microns. This grind size and flotation time is typical of porphyry copper flotation response and grind requirements.  Three stage open circuit cleaner tests carried out on the rougher concentrate resulted in overall recoveries to the third cleaner concentrate of 80% of the copper and 60% of the gold. The grade of the final concentrate was 22.5% copper and 65 grams/tonne Au. The cleaning tests were carried out at a grind of 80% passing approximately 50 microns.  The 10% copper loss in the cleaning circuit is not untypical of open circuit cleaning and better recoveries could be achieved in plant operation and would likely be indicated in locked cycle (closed circuit) cleaning tests or pilot plant testing. The final concentrate copper grade is not in the typical range of 25% to 30%. Better results with respect to both grade and recovery are likely to be achieved by further optimization of the reagent regime and a finer regrind prior to the cleaner flotation. One would expect to see a required grind in the range of 80% passing 30 to 40 microns.  Given that the bulk of the value lies in the gold rather than the copper in this material the high losses to both the rougher tails and the cleaner circuit tails are of significant concern. Approximately 20% of the gold is lost in each of these streams. Finer grinding of the rougher stream increased copper recoveries slightly while not improving gold recoveries. Future work should address the form of this gold loss and investigate options to improve it.  The mineral resource model presented in the technical report prepared by SRK Consulting Canada Inc. and filed on the Internets System for Electronic Document Analysis and Retrieval (SEDAR) on February 22, 2008 represents the first resource evaluation for the Whistler copper-gold deposit. This initial mineral resource model was prepared to provide an initial assessment of copper and gold sulphide  -43-  zones delineated by drilling on this project and to provide management an independent assessment to justify additional exploration and development work. The resource estimate was completed by George H. Wahl, P.Geo an independent qualified person as this term is defined in National Instrument 43-101. The effective date of this resource estimate is December 31, 2007.  Estimated mineral resources fall into two broad categories dependent on whether the economic viability of them has been established and these are namely resources (economic viability not established) and ore reserves (viable economic production is feasible). Resources are sub-divided into categories depending on the confidence level of the estimate based on level of detail of sampling and geological understanding of the deposit. The categories, from lowest confidence to highest confidence, are inferred resource, indicated resource and measured resource. Reserves are similarly sub-divided by order of confidence into probable (lowest) and proven (highest). The resource classifications used below can be more particularly described as follows:  inferred mineral resource is that part of a mineral resource for which quantity and grade or quality can be estimated on the basis of geological evidence and limited sampling and reasonably assumed, but not verified, geological grade and continuity. The estimate is based on limited information and sampling gathered through appropriate techniques from locations such as outcrops, trenches, pits, workings and drill holes.  indicated mineral resource is that part of a mineral resource for which quantity, grade or quality, densities, shape and physical characteristics can be estimated with a level of confidence sufficient to allow the appropriate application of technical and economic parameters, to support mine planning and evaluation of the economic viability of the deposit. The estimate is based on detailed and reliable exploration and testing information gathered through appropriate techniques from locations such as outcrops, trenches, pits, workings and drill holes that are spaced closely enough for geological and grade continuity to be reasonably assumed.  All mineral resources referenced in the technical report have been estimated in accordance with the definition standards on mineral resources and mineral reserves of the Canadian Institute of Mining, Metallurgy and Petroleum referred to in NI 43-101. U.S. reporting requirements for disclosure of mineral properties are governed by the SEC Industry Guide 7 ("Guide 7"). NI 43-101 and Guide 7 standards are substantially different. The terms "mineral reserve", "proven mineral reserve" and "probable mineral reserve" are Canadian mining terms as defined in accordance with NI 43-101. These definitions differ from the definitions of "proven (measured) reserves" and "probable (indicated) reserves" in Guide 7. Under Guide 7 standards, a "final" or "bankable" feasibility study is required to report reserves, the three-year historical average price is used in any reserve or cash flow analysis to designate reserves and the primary environmental analysis or report must be filed with the appropriate governmental authority.  The technical report uses or may use the terms "mineral resource," "indicated mineral resource" and "inferred mineral resource". We advise investors that these terms are defined in and required to be disclosed by NI 43-101. However, these terms are not defined terms under Guide 7 and are normally not permitted to be used in reports and registration statements filed with the SEC. Investors are cautioned not to assume that any part or all of mineral deposits in these categories will ever be converted into reserves. "Inferred mineral resources" have a great amount of uncertainty as to their existence and economic and legal feasibility. It cannot be assumed that all or any part of an inferred mineral resource will ever be upgraded to a higher category. Under Canadian rules, estimates of inferred mineral resources may not form the basis of feasibility or pre-feasibility studies, except in rare cases. Investors are cautioned not to assume that all or any part of an inferred mineral resource exists or is economically or legally mineable.  -44-  Mineral Resource Statement for the Whistler Gold Deposit, Alaska Prepared by SRK Consulting (Canada) Inc December 31, 2007.


|                        |                   |                       |              |            |               |            |              |              |               
|----------------------- | ----------------- | --------------------- | ------------ | ---------- | ------------- | ---------- | ------------ | ------------ | --------------
|                        | Tonnes and Grades | Total Contained Metal
|Resource Category       | Tonnage
(Mt)      | Gold (g/t)            | Silver
(g/t) | Copper
(%) | Gold 
Eq3 g/t | Gold
(Moz) | Silver
(Moz) | Copper
(Mlb) | Gold Eq3 (Moz)
|Indicated (open-pit1)   | 30                | 0.87                  | 2.46         | 0.24       | 1.35          | 0.84       | 2.37         | 159          | 1.31          
|Total Indicated         | 30                | 0.87                  | 2.46         | 0.24       | 1.35          | 0.84       | 2.37         | 159          | 1.31          
|Inferred (open-pit1)    | 123               | 0.59                  | 2.07         | 0.19       | 0.98          | 2.33       | 8.19         | 515          | 3.86          
|Inferred (underground2) | 11                | 1.16                  | 3.55         | 0.24       | 1.66          | 0.41       | 1.26         | 58           | 0.59          
|Total Inferred4         | 134               | 0.64                  | 2.18         | 0.20       | 1.05          | 2.74       | 9.44         | 573          | 4.44          

1. Reported within a conceptual pit shell and based at a cut-off grade of 0.3 g/t gold equivalent adjusted for metallurgical recovery. 2. Reported based on an underground bulk mining method using a cut-off grade of 1.1 g/t gold equivalent adjusted for metallurgical recovery; 3. Gold equivalent grade estimated based on 75 percent recovery for gold and silver; 85 percent recovery for copper; US$550 per ounce gold, US$8 per ounce silver and US$1.50 per pound of copper; 4. Totals may vary due to rounding.  Subsequent to the date of the Whistler Technical Report, approximately 40% of the recommended drilling on the Whistler Project was completed with a further five holes (2,462 metres) drilled on the Whistler Zone in 2008 at a cost of approximately US$3.1 million. Approximately 26% of the regional exploration core drilling program was completed in the 2008 season with six holes (1,840 metres) drilled on regional targets.  Future Exploration Programs  The drilling program, consisting of a minimum of 5500 metres and approximately fifteen holes commenced in mid-March, and will continue to test targets generated from IP geophysics, field mapping and sampling, and 1500 metres (in five holes) of drilling completed during late 2009. The initial 2010 program will be overseen by a joint committee of technical management from both Kiska and Kennecott Exploration Inc. Completion of the program will provide all the data necessary for Kennecott to decide whether to elect its one-time right to purchase a 51% interest in the Whistler Project by refunding 200% of the projects exploration expenditures and by advancing the project to a positive prefeasibility study. Kennecott can then earn an additional 9% project interest by advancing Whistler to a production decision.  The Qualified Person for this property is Mark Baknes, P.Geo. Vice President, Exploration for the Corporation. The SRK technical report with the initial resource estimate was filed on SEDAR on February 22, 2008.  The Corporations other British Columbia and Yukon properties include:   -45-  Adam Property, Skeena Mining Division, BC  The Adam Property, covering 1,823 hectares, is approximately 70 kilometers northwest of Stewart, British Columbia. The Corporation sold 100% of these claims to Paget Resources Ltd. for a cash payment of $10,000. The Corporation retains a 2% NSR.  Boulevard Property, Whitehorse Mining District, Yukon  The Boulevard Property, consisting of 238 claims, is located approximately 135 kilometers south of Dawson City, Yukon. The Boulevard Property was held jointly by Kiska (40%) and Northgate Minerals (60%), with each company having funded the initial $330,000 in exploration that led to staking of the property. Northgate solely funded the next exploration program to earn an additional 10% interest.  Effective July 22, 2009, the Corporation signed an option agreement with Silver Quest Resources Ltd. (Silver Quest) under which Silver Quest can acquire the Corporations 40% interest in the property. Silver Quest will make staged cash payments totaling $80,000 ($16,000 upon regulatory acceptance), issue an aggregate of 400,000 shares (80,000 upon regulatory acceptance) and complete exploration expenditures of $3,000,000 ($200,000 the first year) over a five year period. The Corporation retains a 1% net smelter royalty (NSR) on the property, with Silver Quest having the right to buyback 0.5% of the NSR for $375,000. In addition, should Silver Quest complete a 43-101 compliant resource estimate on the property in excess of 1,000,000 ounces of gold in an indicated category, they will be required to make a one-time bonus payment of an additional 500,000 shares of its capital stock to Kiska and Northgate. All cash and share payments are to be split between Kiska and Northgate.  Silver Quest also purchased from the Corporation and Northgate certain data pertaining to soil, silt and rock sampling completed in areas around or near the property. If Silver Quest acquires open ground by staking within defined areas, the company will be required to issue additional common shares, up to a maximum of 500,000, and the additional property, if any, will be further subject to a NSR in favor of the two original partners. Silver Quest would be entitled to buyback 1% of the NSR for $1,000,000. Late in 2009, Silver Quest acquired claims by staking and issued an additional 100,000 shares to the Corporation.  The Boulevard area was selected from a much larger regional compilation and reconnaissance silt sampling program that led to the identification of anomalous gold and pathfinder elements in creeks draining the Boulevard. Detailed soil sampling in 2007 outlined the multi-element geochemical anomaly that was tested by trenching in July 2008. In light of positive trench results the Corporation and Northgate staked additional claims.  Diamond drilling in September 2008 was focused on trenched areas with significant widths of gold mineralization. Additional targets were identified from results of a magnetometer survey and previous soil geochemistry data. A total of 525 meters of core was drilled in seven holes from six different locations. In total, 4.85 line kilometers of IP and 45 line kilometers of magnetometer survey were completed. The soil survey grid was extended southeast from the existing Boulevard grid. The drilling intersected gold mineralization in five of seven holes. Drilling tested the mineralization in the discovery trench and targets along the apparent strike of this mineralization, within a large multi-element soil geochemical anomaly.  Silver Quest completed a preliminary program of trenching and geochemical sampling in 2009.   -46-  Gillis Property, Nicola Mining Division, BC  The Gillis property consists of 14 claims covering 6,182 hectares of rolling upland terrain 30 km southwest of the town of Merritt, British Columbia. Access to the property is primarily by a Bell 206 helicopter based out of Merritt. Although the areas where most of the exploration is focused are not road accessible, future road access could be facilitated from gravel forestry roads that circle the property.  Previous work on the Gillis property was limited to reconnaissance stream sediment and soil geochemical surveys carried out by Almaden Minerals Ltd. in 2005 and 2006 focused on follow up of regional stream sediment geochemical gold anomalies in 2005-2006. This work had identified anomalous gold-in-silt geochemistry in a number of drainages and very limited follow-up defined anomalous gold soil geochemistry with a few rock samples returning weakly anomalous gold values.  The Corporation signed an option agreement to earn a 100% interest in the Gillis property, subject to a 2% NSR, 1.5% of which can be purchased for $1.5 million. The Corporation is to: make cash payments of 2.5% of mineral exploration expenditures and: · $15,000 within 10 days of the execution of the agreement (paid) · $25,000 on or before September 5, 2009 (paid) · $50,000 on or before September 5, 2010 · $75,000 on or before September 5, 2011.  fund exploration expenditures of: · not less than $75,000 on or before September 5, 2009 (completed) · an aggregate $125,000 on or before September 5, 2010 (completed) · an aggregate $200,000 on or before September 5, 2011 · an aggregate $300,000 on or before September 5, 2012  issue 217,500 common shares to the vendors within 10 days of announcement of NI 43-101 compliant gold resource of 500,000 oz.  During October 2008, Rimfire Minerals Corporation carried out a mapping, prospecting, and geochemical sampling program on the Gillis property. The sampling work was contracted to RIO Minerals Ltd. who completed 80 kilometers of soil lines, collecting a total of 1712 soil samples. A total of 64 rock samples were taken during prospecting and mapping which focused on previously defined soil and silt anomalies in the western and central portions of the property. Prospecting led to the discovery of three showings that have anomalous values of gold and silver in combination with other pathfinder elements.  No exploration program has been planned for 2010. The Corporation intends to seek joint venture partners for some or all of the claims.   -47-  Grizzly & RDN Properties, Liard Mining Division, BC  The RDN/Grizzly Property is located in the Liard Mining Division of British Columbia approximately 120 kilometers northwest of Stewart, British Columbia and 50 kilometers north of the Eskay Creek Mine. The RDN property is comprised of 14 claims, covering approximately 8,576 hectares while the contiguous Grizzly property is comprised of 8 claims covering 2,652 hectares.  Regional exploration in the area was conducted by several mining companies from the 1960's to the early 1980's, which resulted in the discovery of porphyry and vein style mineralization at the nearby Snip, Johnny Mountain and Sulphurets areas. In 1989, Noranda Exploration Company carried out a program of sampling and conducted airborne magnetic and aeromagnetic surveys over the property. They continued the exploration with geochemical and geophysical surveys and a 15 hole diamond drilling program in 1990 followed by expanded geophysical surveys and the drilling of an additional 15 diamond drill holes in 1991. Pathfinder Resources Limited carried out work programs which included soil sampling, geological mapping, prospecting, and geophysical surveying between 1994 and 1996. Rimfire Minerals Corporation purchased the property in 1997, subject to 1.34% NSR, one-half of which may be bought for $666,666. On December 14, 2005, Rimfire Minerals Corporation purchased 100% of the LL property, which is contiguous with the RDN, for $30,000 cash with a net smelter return royalty of 2%. This royalty can be purchased at any time for $2,000,000. In 1999, Rimfire Minerals performed a surface exploration program followed by a 574 meter, 9 hole drill program testing targets at the Marcasite Gossan, Jungle and Main Zones. In 2000 Newmont Canada Limited (Newmont) optioned the property and carried out a 27 kilometer UTEM geophysical survey later that year. In 2002 Newmont completed a 13 hole program totaling 2256 meters, in the Wedge Zone, Sand Lake, Marcasite Gossan and Boundary Zones. In late 2002 Newmont dropped their option and by 2003 Barrick Gold Corporation (Barrick) optioned the property and carried out a program of mapping, prospecting and contour soil sampling focused on areas underlain by rhyolitic volcanics including the Arctic Grid and Boundary Zone. During 2002 Barrick completed a 9 hole 1125 meter drill program testing targets at the Jungle and Carcass Valley areas.  The Corporation signed an option agreement and subsequent amendments with Northgate Minerals Corporation (Northgate) which provides that Northgate can earn a 51% interest in the RDN Property on completion of the following:  Fund exploration expenditures of: · not less than an aggregate of $3,000,000 on or before December 31, 2006
(as revised December 2, 2005) (completed) · not less than an aggregate of $5,000,000 (requirement suspended on February 21, 2007 until a later date, to be mutually agreed upon) Cash payments of: · an aggregate of $125,000 on or before March 1, 2006(received) · $75,000 (requirement suspended on February 21, 2007 until a later date, to be mutually agreed upon) The Corporation will be project operator until Northgate has earned its 51% interest. Northgate may earn an additional 9% by completing a feasibility study and funding all expenditures up to completion of the feasibility study.  The Corporation signed an amendment suspending the terms of the option agreement with Northgate until such time as road access to the RDN property is constructed. The Teck /Novagold partnership developing the Galore Creek deposit is constructing this road to access their project. Much of the road has been completed, but construction has been suspended until such time that a decision to continue the  -48-  mine construction is made by Teck. Some of the RDN claims were split into a separate property to be referred to as the Grizzly Property. The Grizzly Property is owned 100% by the Corporation subject to the underlying NSR.  During 2004, Northgate completed 2499 meters of drilling in nine holes. Several precious-metal bearing intervals were intersected; however, these are interpreted as veins and breccias that are unlikely to have economic significance. During 2005, six drillholes were completed for a total of 1,470 meters in two target areas: the Blind Fault and Arctic Grid. Continuous surface channel sampling in the Blind Fault area returned 24.7 meters averaging 24.9 grams/tonne silver, which were largely duplicated in the subsequent drill holes. Drilling at the Arctic Grid target intersected stratigraphy equivalent in age and geological setting to that hosting the Eskay Creek deposit. During 2006, an airborne geophysical survey was conducted over the Arctic Grid and LL areas of the property, and a four hole (1350 meter) drill program on the Arctic Grid target successfully tested the Eskay Creek time equivalent mudstone  rhyolite contact, but failed to intersect significant mineralization.  In 2008, Inmet Mining Corporation conducted a two-phase exploration program on the Grizzly property investigating porphyry-style mineralization exposed in a hand trench where a continuous chip sample returned 38 meters grading 1.09 grams/tonne gold and 0.74% copper.. The first phase program consisted of geological mapping, rock sampling, a soil geochemical survey and a 32 line-kilometer IP geophysical survey. The second phase of the program consisted of 2,128 meters of diamond drilling from 11 holes. Results from the drill program failed to intersect mineralization similar in grade to that sampled in the hand trench. Inmet later dropped their option on the property and no exploration program has been planned for 2010. The Corporation intends to seek joint venture partners for some or all of the claims.    Kizmet Property, Atlin Mining Division, BC  The Kizmet property consisting of eight claims (5,471 hectares) is located in northwest British Columbia approximately 90 kilometers south of Atlin, British Columbia. The main target of exploration on this property is epithermal gold-copper-silver-lead-zinc vein and breccia mineralization analogous to that found on the Corporations Thorn property to the south. It is believed that the epithermal mineralization in the district is strongly linked to a newly recognized suite of Cretaceous aged volcanic and plutonic rocks informally referred to as the Windy Table Suite that are formed on a basement of Triassic and Jurassic Stikine-Terrane sedimentary and volcanic rocks.. The Kizmet property was a joint venture with Barrick Gold Corporation (Barrick). Rimfire Minerals contributed claims totaling 27,939 hectares to the joint venture while Barrick contributed claims covering an area of 67,865 hectares. In November 2006, Barrick gave notice of termination of the joint venture. The claims have reverted to 100% ownership by the Corporation, subject to a 1% NSR in favour of RGLD Gold Canada, Inc.  A regional sampling, prospecting and mapping program was conducted by the Corporation during the late summer of 2004. Geological mapping and age-dating identified a Cretaceous-aged belt of volcanic and associated intrusive rocks distinct in age with coincident strong gold-silver-arsenic geochemical signature and local occurrences of precious metal-rich base metal veins, a zone of precious metal-rich silicified sedimentary rock, iron-zinc skarn and sedimentary-hosted gold-bearing disseminated sulphides. During the summer of 2005, Barrick conducted a prospecting, mapping and stream sediment sampling program that identified several anomalous areas. A technical report has not been filed on the Kizmet Project.   -49-  No exploration program has been planned for 2010. The Corporation has retained the core group of claims and permitted the outlying claims to lapse. The Corporation intends to seek joint venture partners for some or all of the remaining claims.  Kliyul Property, Omineca Mining Division, BC  The Kliyul property consists of 54 claims covering 3,728 hectares located approximately 115 kilometres north of Takla Landing. The Corporation has a 30% interest in the Kliyul property in a joint venture with Kennecott holding 45% and Daylight Energy Ltd. holding the remaining 25%. The property features an extensive copper-gold intrusive related system.  Poker Creek, Liard Mining Division  The Poker Creek property, consisting of 12 claims (5,035 hectares), is located approximately 16 kilometers west of the town of Telegraph Creek. The Property and surrounding area are underlain by mid-Paleozoic and Mesozoic island arc successions belonging to Stikinia, which have been intruded by numerous igneous bodies of Triassic and Jurassic age. The claims were staked to cover potential copper gold porphyry mineralization.  During the period 1989-1991 four short duration reconnaissance prospecting, geochemical and mapping surveys were conducted over what is now the Poker Creek property by two different operators. Work defined Triassic sediments and volcanics of the Stuhini Group intruded by a variety of equigranular to porphyritic intrusions. Work was focused on both porphyry potential and gold-bearing mesothermal vein mineralization. Local areas of mineralization were noted and consist of weakly developed quartz-carbonate gold-silver and base metal-bearing veins with a sometime inferred spatial relation to porphyritic dykes and sills. Some moderately gold and copper anomalous silt sample results were obtained.  In August 2008, Rimfire carried out a helicopter supported seven day reconnaissance program of soil sampling, prospecting and geological mapping on the claims. Two soil lines returned highly anomalous results in copper and to a lesser extent gold over a roughly 1 by 1 kilometer area. Adjacent silt sample results indicate an area in excess of three kilometers east to west that is highly anomalous in both copper and gold. The metal signature and local geology of the area indicate potential for porphyry copper-gold-style mineralization.  No exploration program has been planned for 2010. The Corporation intends to seek joint venture partners for some or all of the claims.   -50-  Quesnel Trough Project, Cariboo Mining Division, BC  A total of seven properties, covering 34,570 hectares, comprise the Quesnel Trough project and are located from 15 kilometers south of Prince George to 40 kilometers north of Fort St. James. The Corporation owns 100% of these claims. The project is targeting possible porphyry coppergold mineralization based on regional geophysical anomalies. An approximately 2000 line-kilometer helicopter airborne magnetics survey was completed during November 2007.  During 2008, Rimfire completed surface reconnaissance programs over all seven target areas. Alteration consistent with porphyry copper  gold mineralization systems was encountered on three targets including anomalous copper geochemistry in rocks on two of these targets and anomalous copper and gold geochemistry in soil samples from one target area. The remaining geophysical targets all occur beneath till or young basalt cover.  Xstrata Canada Corporation (Xstrata) signed an option agreement to explore the Quesnel Trough properties. The terms of the agreement grant Xstrata the option to earn a 51% interest in the property by completing a preliminary assessment and spending $3,000,000 by December 31, 2013. In addition, Xstrata must spend no less than $250,000 in each calendar year commencing in 2010. Xstrata may earn an additional 24% (total 75%) by completing a feasibility study and incurring no less than $20 million in feasibility study expenditures which must be completed within the Bump-up period which ends on the tenth anniversary of Xstrata earning its 51% interest.  Xstrata carried out reconnaissance soil sampling programs employing selective leach geochemistry (MMI) designed for detecting glacial till covered mineralization. A total of 1824 samples were collected and encouraging results were detected on six of the seven claim blocks. Xstrata plans to carry out follow-up auger sampling on some of the more prospective geochemical anomalies and will conduct a small scale drill program in 2010. Xstrata will act as operator and fund the exploration programs.  Redton Property, Omineca Mining Division, BC  The Redton Property is comprised of a total of 217 mining claims and covers 96,151 hectares. It is located approximately 140 kilometers northwest of Fort St. James, British Columbia. The property contains three porphyry copper prospects. The project adjoins the Kwanika property and is within 1,500 metres of the recent discovery made by Serengeti Resources Inc. on the Kwanika property. Kiska has earned an 85% interest, subject to underlying royalties, in the project by spending in excess of $4.75 million. Redton Resources Inc. holds the other 15% interest.  During 2008, the Corporation drilled a total of eight diamond drill holes totaling 2,996 metres with all eight holes intersecting visible molybdenite (MoS2) mineralization. Results from the drilling confirm a mineralized envelope of at least 440 metres by 475 metres which extends from surface to depths of at least 418 metres and is open in all directions.     -51-  Thorn Property, Atlin Mining Division, BC  The property consists of 18 mineral claims (14,689 hectares) and is located in the Atlin Mining Division, approximately 120 kilometers northwest of Telegraph Creek. The earliest known work on the Thorn property was carried out by Kennco Explorations (Western) Limited in 1959 during a regional exploration program, followed by three years of seasonal exploration from 1963-65.  In 1983, Inland Recovery Group Ltd. acquired the Thorn property and carried out mapping, soil sampling and VLF-EM surveying near the junction of Camp and La Jaune creeks. In 1986, Inland Recovery and American Reserve Mining Corp. drilled eight holes (688 meters).  Kohima Pacific Gold Corp. (Kohima) staked the Stuart 1-3 claims in 1997 and acquired an option on the Checkmate claim. In 1998, Kohima conducted an alteration mineralogy study using a portable infrared spectrometer (PIMA) on select outcrops in Camp Creek, and drill core from three diamond drill holes from the 1986 campaign. Rimfire Minerals Corporation was granted an option to acquire a 100% interest in the Thorn property (four claims). The Corporation exercised the option by making staged cash payments of $230,000 by March 2, 2005, issuing a total of 200,000 shares by March 1, 2003 and incurring exploration expenditures of $50,000 by March 1, 2001. The Corporation subsequently staked an additional seven claims surrounding the initial claim block, but lying within the Kohima area of interest covered by that agreement. A further 19 claims were staked over favourable geochemical targets between April 2003 and May 2004. This total of 30 claims was converted to 21 larger claims in the Mineral Titles Online map-staking initiative. Subsequently three claims were permitted to lapse resulting in 18 active claims. Kohima has retained a 3.5% net smelter return royalty, of which the Corporation can purchase a 57% interest (being 2% of the 3.5% interest) for $3 million. In addition to the above, the Corporation will issue 174,000 common shares to Kohima upon the commencement of commercial mining operations on the Thorn property.  Rimfire Minerals signed an option agreement with Cangold Limited, formerly First Au Strategies Corporation (Cangold) under which Cangold earned a 51% interest in the property by making staged cash payments totaling $190,000, issuing a total of 250,000 shares to the Corporation and by incurring exploration expenditures of $1.2 million. Effective April 11, 2008, Rimfire signed a purchase agreement to acquire Cangolds interest in the property by making a cash payment of $100,000 and issuing 100,000 shares. In the event a third party partner becomes involved in the exploration and development of the property, the Corporation will pay to Cangold 25% of any cash or share payments received from the third party partner.  Exploration on the Thorn property is directed at two deposit types: (1) high-sulphidation epithermal mineralization of the El Indio/Lepanto style; and (2) breccia  hosted silver-gold-lead-zinc mineralization discovered in the Oban Zone in 2002. A number of pyrite+enargite+tetrahedrite+quartz veins are hosted by sericitized and argillized feldspar-quartz-biotite porphyry of the Thorn Stock over an area of 1,400 x 2,000 meters. A strong structural control is evident for the veining, much of which trends 070° and dips steeply.  A seven-hole, 498 meter drill program conducted on behalf of Cangold tested three showings over a 1.2 kilometer trend in 2002. Three shallow holes were collared at the Oban Breccia to test surface mineralization. All three holes intersected weakly mineralized breccia. A total of four holes were drilled to test the I Zone and Tamdhu Zone. All four holes intersected the target structures, confirming the continuity of vein mineralization.   -52-  In 2003, work focused on trenching within the Oban soil geochemical anomaly and drill-testing the Oban breccia pipe. 841 meters of trenching exposed approximately 10% outcrop consisting of weakly mineralized breccia pipe. Eight diamond drill holes totaling 876 meters were completed. Four holes intersected significant zones of fine-grained mineralization occurring as matrix infill between breccia clasts. The high grade intersections define a steeply northwest-dipping mineralized zone with an apparent width of 14-26 meters. Generally lower-grade zones (12-25 meter apparent width) flank this mineralized core.  In 2004, an IP geophysical survey demonstrated a significant correlation between the IP geophysics and known silver-gold mineralization but also identified several new targets in areas of no outcrop. Later in the year, a drill program was completed consisting of 1810 meters in 12 holes targeting the Oban Breccia Zone, massive sulphide veins in the Camp Creek Structural Corridor and IP geophysical anomalies. Drill hole THN04-29 tested part of a 500 meter long IP anomaly and intersected 56.1 meters of 1.27 grams per tonne gold, 16.7 grams per tonne silver and 0.19% copper in a new zone dubbed the Talisker Zone. Prospecting prior to the commencement of the drill program resulted in the discovery of a quartz-barite boulder assaying 265 grams per tonne (7.7 ounces/ton) gold two kilometers north of the Camp Creek Structural Corridor in an area of the property that has not seen previous work.  Highlights of the 2005 exploration program included 17.4 kilometers of IP geophysical surveying and 655.8 meters of drilling in five holes. The 2005 IP helped to further outline and define the Talisker Zone, and located two new anomalies further north. Geological mapping and rock sampling during 2005 focused on the margins of the Thorn Stock and the overlying Windy Table Formation volcanic units as recent age dating of these rocks revealed that they may be affected by mineralizing events at the Thorn.  Two holes were drilled at the Talisker Zone, which was extended over a strike length of at least 200 meters with intercepts in both 2005 step out holes. Two holes, which tested the new IP target at the Cutty Sark anomaly, intersected the first occurrences of lithologically controlled alteration on the property. One hole tested the far eastern extent of the Balvenie Zone, another vein system parallel to the Talisker Zone. A technical report was filed on SEDAR on May 12, 2006. Cangold Limited was operator for this project and no work was completed on the project during 2006, 2007, or 2008.  In 2009, the Corporation undertook a re-interpretation of all the geophysical data for Thorn including three dimensional inversion processing. The resulting products have enabled the Corporation to better target mineralization under cover rocks for future exploration programs.  The next stage of exploration on the Thorn property will be a diamond drill program focused on resource definition at the Talisker Zone and exploration drilling at several other IP geophysical targets identified in 2004 and 2005. The Corporation is seeking a partner to advance exploration on the project. There are currently no plans to conduct exploration on the property in 2010.   -53-  Tide Property, Skeena Mining Division, BC  The Tide Property, consists of four claims covering 2,964 hectares and is located approximately 36 kilometers north of Stewart, British Columbia The Tide property covers a group of precious metal-bearing polymetallic mineral occurrences in the Stewart area of northwestern British Columbia. They were discovered in the 1980s through follow-up of highly anomalous silt and soil geochemistry.  The first recorded work on the Tide property was done by Northair Mines Ltd., who carried out extensive silt and soil sampling from 1980 to 1986, discovering and blast-trenching several gold-bearing showings, and drilling 455 meters in two holes. Austral Pacific Gold Corporation and Claimstaker Resources Ltd. optioned the Tide property from 1988 to 1990, carrying out extensive mapping and ground geophysical surveys. Claimstaker drilled four holes totaling 120 meters in 1990, but three were abandoned in overburden. The Northair claims were allowed to lapse in 1993 and were re-staked by Hemlo Gold Mines Inc. (now Newmont Canada Limited) as the Bow-1 to -4 and Arrow claims, which constitute most of the current Tide property. In 1994, Hemlo carried out property-wide mapping and took soil samples on reconnaissance contour and ridge/spur lines.  Rimfire Minerals Corporation purchased the Tide property from Newmont Canada Limited for a total cash expenditure of $10 with an underlying 1.5% NSR in the event the property becomes commercially feasible to mine. This NSR has been transferred to Franco-Nevada Corporation.  On October 28, 2002, and amended on July 25, 2003, October 20, 2003 and November 20, 2003, Rimfire granted Plutonic Capital Corp. (Plutonic) an option to earn a 51% interest in the property on completion of a combination of cash and share payments and exploration expenditures. In consideration of the second extension, dated October 20, 2003, Plutonic issued an additional 100,000 common shares to Rimfire. In an option amendment agreement dated November 20, 2003, Plutonic assigned the agreement to Serengeti Resources Inc. (Serengeti). As compensation for this amendment, Serengeti issued 100,000 shares to Rimfire. Effective October 27, 2006, this agreement was assigned to American Creek Resources Ltd. (American Creek). Upon exercise of the option, Serengeti retains a 1% NSR upon the 51% interest earned by American Creek. American Creek has earned their 51% interest in the property: On February 8, 2007, Rimfire signed a letter of agreement with American Creek for a second option whereby American Creek can earn an additional 9% interest by funding a further $3.5 million in exploration on or before December 31, 2010. Their interest can be increased to 65% interest by funding a bankable feasibility study, and, at the Corporations election, to 70% interest by providing 100% of the initial project development financing. American Creek is operator for the project.  In 2004, Serengeti conducted two phases of exploration: an early summer program of geological mapping, prospecting and soil geochemical sampling infilling areas with poor sample coverage followed by a fall program of diamond drilling consisting of four holes totaling 598 meters and further prospecting.. Significant gold mineralization was intersected at the 36 Zone. This intersection is significant in that it tested a soil geochemical anomaly measuring 450 x 350 meters of greater than 0.5-gram per tonne gold that remains open in all directions. The hole was collared in the middle of the soil anomaly which is reflected in the mineralization found throughout its entire length. Prospecting work undertaken in conjunction with the drilling resulted in the discovery of a high grade vein structure, coined the 52 Zone, in the northeast corner of the property.   -54-  An airborne magnetics and electromagnetics geophysical survey was flown over the property in the spring of 2005 to aid in drill targeting and identifying structural trends on the property. The primary focus of the 2005 drilling was to follow up the 2004 drilling discovery of gold mineralization. Eight holes totaling 967 meters were drilled, four targeting the 36 Zone and four targeting the 52 Zone. The holes in the 36 Zone had mineralized intervals which extended the zone to the northeast, southwest and in depth. Infill soil geochemical sampling between the 36 Zone and the South Pit soil anomalies to the south showed that the two anomalies are continuous as defined by gold values in excess of 500 ppb (0.5 grams per tonne) gold. This gold-arsenic+/-antimony anomaly is now approximately 500 meters by 2,100 meters in size, with diamond drilling having tested an area of 170 by 350 meters. Prospecting and trenching were completed at the 52 Zone. The diamond drilling, combined with the surface results, has shown mineralization in this zone to be highly variable in nature.  Exploration on the Tide property continued with a geological mapping, fracture density surveying and channel sampling program completed in September, 2006. In 2007, American Creek conducted an exploration program consisting of 1,835 meters of diamond drilling in eight holes to test extensions to the 36 Zone and other bulk tonnage gold targets within the Crest soil anomaly. In addition to drilling, crews completed 318 meters of surface channel sampling (121 samples) and detailed geological mapping on selected drill sections and between drill holes to sample east-west trending mineralized fractures that are the dominant gold-bearing host. Every hole drilled in the 2007 program returned anomalous gold values over large widths. A technical report was filed on SEDAR on April 30, 2008. There have been no material changes since that date. No work was completed on the Tide during 2008 or 2009. The operator, American Creek, has not proposed a program for 2010.  Wernecke Breccia, Mayo Mining District, Yukon  The Wernecke Breccia properties, consisting of 1,926 claims, are situated in the Wernecke Mountains, approximately 180 kilometers northeast of Mayo in east-central Yukon Territory. Access to the property is via fixed wing aircraft to Copper Point airstrip and then by helicopter to the property. In January 2006, Rimfire Minerals Corporation signed an agreement with Fronteer Development Group Inc. (Fronteer) to acquire 700 mineral claims and a proprietary geoscience dataset covering the Wernecke Breccia property from Newmont Exploration Canada Limited (Newmont) and NVI Mining Ltd., a subsidiary of Breakwater Resources Ltd. (NVI).  Fronteer has completed the required $2 million in exploration expenditures. Newmont and NVI retain a total 2% NSR. There is a 7.5% to 15% Net Profits Interest payable to the underlying vendors. Fronteer is operator of the project and has funded 100% of the exploration costs to earn an 80% interest, with Rimfire earning the remaining 20% interest. Effective November 15, 2006, a Joint Venture was formed between Fronteer and Rimfire Minerals Corporation, and ongoing exploration expenses were shared pro-rata subject to dilution for non participation. Should either partys interest fall below 5%, their interest will be converted to a 3% Net Profits Interest after payback of capital and elimination of the vendors Net Profits Interest.  The Wernecke Breccias have been explored for copper, uranium and gold in the 1960s, 1970s, and 1980s. However, as iron oxide copper-gold (IOCG) deposits are relatively recently described, early exploration was not able to take advantage of this model. In the mid 1990s, Newmont Exploration Limited made a strong effort to advance the exploration of the Wernecke Breccias for their gold and copper potential, spending a total of U.S.$5.5 million on more than 20 properties. Newmont flew a regional airborne magnetic and radiometric survey and conducted extensive geochemical sampling and geological mapping prior to drilling twelve prospects for a total of 14,600 meters.  -55-   During 2006, Fronteer completed a $2.8 million exploration program comprised of prospecting, geological mapping, geochemical sampling and a 9,750-line-kilometer airborne gravity geophysical survey. Survey data was combined with surface geochemistry results and proprietary magnetic and radiometric data obtained from Newmont Exploration of Canada Ltd. to select drill targets for 2007 programs. Through the course of the 2006 program, Fronteer evaluated 48 target areas for their potential to host Olympic Dam-style copper-gold-uranium and stand-alone uranium deposits. Surface sample results have been compiled for two target areas; the Thunder Mountain property and Fireweed prospect.  The Thunder Mountain property is a new gold-uranium-copper anomaly. A total of 25 samples were taken over an area of approximately 400 by 550 meters. Copper-bearing breccia was also noted nearby. The Fireweed prospect is a new uranium prospect where 93 boulders of iron oxide-potassium feldspar-silica altered chlorite schist were collected over a 200 by 400 meter area and averaged 0.22% U3O8. Twenty-two samples assayed in excess of 0.14% U3O8.  Fronteer commenced a $6 million exploration program early in 2007. A series of high priority drill targets designed to test iron-oxide-copper-gold systems +/- uranium and stand alone uranium targets were identified, all of which are characterized by coincident geophysical, geological and geochemical anomalies. Many of these targets were newly defined in 2006, while some are historical targets that remain open for expansion and have been reinterpreted in light of new data. A total of 3,150 soil samples, 112 silt samples, and 906 rock samples were collected amongst the various target areas. A total of 6,538 meters in 28 holes were drilled.  The most encouraging results from the 2007 drilling have been returned from the Hoover Zone. New results, combined with nine historical drill holes completed in the mid-1990s, indicate the Hoover Zone mineralization has the potential to expand along strike to the north and south as well as down dip. Mineralization has been intersected in 11 widely spaced holes and over approximately 500 meters of strike length. At the Pagisteel prospect the only hole drilled returned a 6.1 meter interval of 2.57% copper and 0.97 grams per tonne gold. The Pagisteel prospect is characterized by a 4-kilometers long trend of anomalous gold and copper soil and rock geochemistry that is largely covered with overburden. A technical report was filed on SEDAR on April 29, 2008. There have been no material changes since that date.  No work was completed during 2009 nor is any work planned for 2010. Fronteer and the Corporation will be seeking joint venture partners to continue exploration of the property.  Williams Property, Liard Mining Division, BC  The Williams property consists of 21 claims covering 10,727 hectares of mountainous terrain in north-central British Columbia, 330 kilometers north of Smithers. The two main prospects (T-Bill and GIC) on the Williams property were independently discovered in the early 1980s by Cominco and Du Pont, following up highly anomalous stream geochemistry. These companies joined forces to drill a total of 3,023 meters on the T-Bill prospect in 1983 and 1984 before allowing the property to lie dormant. On May 17, 2001 Rimfire Minerals Corporation acquired a 100% interest in the property, subject to a 1.25% NSR. Rimfire has earned the interest by paying the property vendors an aggregate $57,500 and issuing to the property vendors an aggregate 125,000 common shares. The Corporation will issue an additional 43,500 shares upon commencement of commercial production from the property. The Corporation can purchase 0.75% of the net smelter return for $1,000,000. Commencing in December 2005, an advance royalty payment of $5,000 per year is required to maintain the option agreement in good standing. All  -56-  advance royalty payments have been made.  Stikine Gold Corporation, during their tenure as optionor, staked an additional 6 claims, surrounding the original claim block to be included in the agreement. Rimfire also staked additional claims based on results of field work.  The Williams property hosts two main styles of alteration and gold-bearing mineralization; orogenic gold and arsenic-bearing veins and disseminations (T-Bill prospect); and porphyry-style copper, gold and molybdenum (GIC prospect). Previous drilling attempted to evaluate the T-Bill mineralization, however, that work was unsuccessful in determining with any certainty the orientation of the veins and associated alteration. In 2003, WG03-10 targeted the T-Bill prospect and intersected 6.92 meters of mineralization plus three other quartz vein zones with visible gold. An oriented core system was employed during the drilling suggesting a northwest  southeast trend to these high grade veins.  An initial program of prospecting, silt and soil geochemistry and core re-examination and sampling was carried out in July 2001. Reconnaissance soil samples were collected along contour or compass lines in areas where previous soil geochemical anomalies had not been closed off, and where gold-bearing silt samples had never been followed up. Core from the 1984 diamond drilling, stored at the 2001 campsite, was examined and 14 previously unsampled sections were split for analysis.  Stikine carried out a 3-D Induced Polarization (IP) geophysical survey in September 2002. The survey defined a large chargeability anomaly, measuring 400 by 300 meters, immediately north of the area tested by the previous drilling. This anomaly is also coincident with a broad 700 by 1,000 meters resistivity anomaly. Contour soil samples from the northwest portion of the chargeability/resistivity anomaly are highly anomalous in gold for over 800 meters. In 2003, Stikine conducted an 11-hole (2,855 meter) drill program targeting the resistivity anomaly, returning only anomalous gold values. One hole, WG03-10, targeted the T-Bill prospect and intersected high grade vein mineralization.  The 2005 exploration program focused on the GIC prospect. Mapping, prospecting, and soil sampling followed by geophysical surveys outlined a compelling new copper-gold porphyry target. IP surveys at the GIC prospect identified a strong 600 by 1,800 meter chargeability high anomaly coincident with and adjacent to known gold and copper mineralization. A 500 x 1,400 meter, east-west trending copper soil geochemical anomaly, enclosing two discrete 300 x 500 to 750 meter gold soil anomalies lies to the north, partially overlapping the northern edge of the GIC chargeability anomaly. The rest of the geophysical anomaly is masked by glacial till except for an isolated outcrop where a chip sample returned 0.22 % copper and 0.22 grams per tonne gold over 3.73 meters. Several gossans lie within the soil anomaly.  During 2006, Arcus conducted a five-hole (881 meter) program of diamond drilling. The program confirmed that alteration mineralogy and mineralization consistent with porphyry-style hydrothermal systems is present at the GIC. All holes intersected anomalous gold, copper and molybdenum concentrations over broad intervals. Drilling mainly targeted the till-covered southern flank and core of the IP chargeability, which drilling has shown to be a result of strong pyrite mineralization. An exploration program consisting of reconnaissance mapping, soil and stream sediment sampling was conducted during August and September 2007. Work covering unexplored jarosite gossans east of the GIC area drilled in 2006, led to the identification of the LN Anomaly, a 450 by 900 meter molybdenum, copper+/-gold-in-soil anomaly. The anomaly, which remains open to the east, is coincident with an airborne magnetic high.   -57-  The focus of the 2007 program at the T-Bill was to confirm the orientation of quartz-carbonate-arsenopyrite veins in order to refine targets for subsequent drilling. This program included hand trenching in select areas to expose veining that previous workers had intersected in drilling. Hand trenching of the T-Bill veining confirmed managements interpretation that the vein swarm is steeply dipping with a northwest/southeast strike. A technical report was filed on SEDAR on February 27, 2007. No material changes have occurred since the report was filed.  No exploration program is planned for the Williams property in 2010. The Corporation is seeking joint venture partners to continue exploration on the property.  Goodpaster Properties, Goodpaster Mining District, Alaska  The Corporation holds an interest in four mineral exploration properties in the Goodpaster Mining District of Alaska, through its wholly-owned subsidiary, Rimfire Alaska, Ltd. (Rimfire Alaska)The Corporation currently owns 100% of the Bou-Swede, California-Surf, Eagle-Hawk, and ER-Ogo-Fire Properties. These properties lie within east-central Alaska, 65 kilometers northeast of Delta Junction.  In 1998, Rimfire Alaska completed a comprehensive compilation of all publicly available data for a large area in east central Alaska, creating an exploration model to identify plutonic-related gold targets. This model provided a basis for the systematic definition and priority ranking of specific geological and geophysical targets in the area. Rimfire Alaska then staked or acquired from arms-length third parties interests in over 1,600 mining claims in the Goodpaster Mining District (the Goodpaster Properties). Rimfire Alaska staked additional claims in August 2003 and March 2004. Property agreements have been amended to include 37 claims staked by AngloGold Ashanti (U.S.A.) Exploration (AngloGold). Late in 2005, data from previous programs and newly published government surveys was re-interpreted and new targets defined. Subsequently, Rimfire Alaska staked additional claims. The Corporation now has an interest in 1,426 claims totaling 145,840 acres (59,019 hectares)  Rimfire Alaska signed an option agreement with Evanachan Limited, which was subsequently assigned to Rubicon Minerals Corporation (Rubicon) to earn a 60% interest in the Alaska properties. The terms of the agreement provide that Rubicon will fund exploration expenditures of: · USD$750,000 on or before November 27, 2007 (completed) · an aggregate of USD$1,500,000 on or before November 27, 2008 (completed) · an aggregate of USD$2,250,000 o on or before November 27, 2009 (completed) · an aggregate of USD$3,000,000 on or before November 27, 2010 · an aggregate of USD$3,800,000 on or before November 27, 2011; and · an aggregate of USD$4,800,000 on or before November 27, 2012  Upon vesting, Rubicon may obtain a further 10% interest in the properties by completing a feasibility study, and at the Corporations election, may obtain an additional 5% interest (for a total of 75%) by providing a project financing loan to be repaid from the Corporations free cash flow upon production.  A technical report was filed on SEDAR on May 7, 2008. The operator, Rubicon, has not proposed a program for 2010.   -58-  California-Surf  The Corporation, through Rimfire Alaska held a 30% joint venture interest in these properties. The joint venture partner, Western Keltic Mines Alaska Inc. (Western Keltic), held the remaining 70% interest in the properties.  In August 2003, Western Keltic sold its 70% interest in these claims to Rimfire Alaska, subject to a 1.75% NSR (of which 1% may be bought for $1,000,000), for the following payments (all payments in Canadian currency): Western Keltics interest in the property has been acquired by Capstone Mining Corporation.  · $25,000, or 50,000 common shares at the election of the Corporation, upon completion of $1,500,000 exploration expenditures subsequent to the agreement, (completed) · $50,000, or 43,500 common shares at the election of the Corporation, upon completion of an aggregate $3,000,000 exploration expenditures subsequent to the agreement, · 87,000 shares upon obtaining a positive feasibility study for placing any part of the property into commercial production.  An exploration, development and mine operating agreement, dated June 22, 2004 was signed with AngloGold which was terminated in November 2004. During this period, AngloGold completed a program of soil sampling along the anomalous portions of lines sampled in 1999 and 2000 to verify previously defined anomalies. Very little sampling was done beyond the areas of previous work.  Rimfire Alaskas 2006 field program investigated the claims staked in 2005 as well as high priority targets generated in previous programs. A total of 243 silt, 1,403 soil and 158 rock samples were collected.The 2007 exploration program initially consisted of 4 holes drilled on the California-Surf group for a total of 957 meters. A combination of grid and reconnaissance mapping, prospecting and soil sampling was carried out on the California-Surf property. Results obtained in hole CN07-1 included a 7.4 meter quartz vein intersection that averaged 1.2 grams per tonne gold including 2.5 meters averaging 2.2 grams per tonne gold. An extension to the first phase program was conducted in August of 2007 and consisted of three drill holes, for a total of 793 meters, to follow up the result of CN07-1. Significant assay results from a 12.2 meter section of quartz-pyrite stringers returned anomalous levels of gold.  During 2008, Rubicon funded an expanded reconnaissance and drilling exploration program on the Goodpaster properties. This program generated 118 rock samples and 27 pan concentrates during a 60 man-day program conducted between mid-May and late August.  Eagle-Hawk Property  On January 30, 2002, Rimfire Alaska signed an exploration, development and mine operating agreement with AngloGold whereby AngloGold could earn a 50% interest in the Eagle property. A December 17, 2003 amendment included the Sand claims (staked by Rimfire Alaska) and the EX claims (staked by AngloGold) in the agreement. Effective December 31, 2005, a termination agreement was signed whereby AngloGold relinquished 100% ownership of the claims subject to an NSR of 2%, one-half of which can be purchased for US $1,000.000.  The Eagle property is located along the Big Swede magnetic trend. The Eagle property is underlain by mid-Cretaceous aged granitic rocks and older intrusive rocks known as orthogneiss. A magnetic low feature corresponds closely with the granitic body. During September 2000, Hyder Gold Inc. completed a  -59-  five hole, 274.3 meter diamond drilling program on the Eagle property. The aim of the program was to test portions of the gold soil geochemical anomaly. In 2002 and 2003, AngloGold conducted auger soil surveys as well as tree bark sampling for biogeochemical studies. Both techniques defined areas of anomalous gold-arsenic and bismuth geochemistry. These geochemical results define a 1,500 meter by 3,000 meter gold-arsenic-bismuth-tungsten soil anomaly. Recovery of rock chips from soil sample pits revealed extensive alteration and in some instances quartz-carbonate stringer-style mineralization.  Two phases of work were completed on the Eagle property in 2004; soil sampling to expand the previous focused soil grid to its current length of 6 kilometers with lines ranging from 0.7 to 1.8 kilometers in length, and a drill program of 9 holes totaling 2,778 meters. Mineralization intersected during drilling consisted of quarts-sulphide vein stockworks containing gold hosted in a granitic stock. A deep penetrating EM survey was carried out late in the season which defined a strong northeast fault zone coincident with anomalous geochemistry.  During 2006, Rimfire Alaska conducted a regional exploration program on these claims. Of particular significance are anomalous gold in silt results obtained from a continuous area to the east, southeast and south of the granitic body that has thus far been the focus of exploration. This anomalous zone extends 5 kilometers outward from the granitic body forming a 10 kilometer arc. In 2007, a combination of grid and reconnaissance mapping, prospecting and soil sampling was carried out on the Eagle-Hawk property.  Following analysis of previous field program results, the 2008 exploration program was designed to conduct project-scale prospecting and reconnaissance exploration work on areas not previously examined and to conduct prospect-scale mapping, sampling and follow-up drilling on targets not previously drilled. Field work was carried out between mid-May and late August from a helicopter-support base camp near Delta Junction.  ER-Ogo-Fire Property  On January 30, 2002, Rimfire Alaska signed an exploration, development and mine operating agreement with AngloGold whereby AngloGold could earn a 50% interest in the ER-Ogo-Fire property. A December 17, 2003 amendment included the Jazz claims (staked by Rimfire Alaska) and the Zappa claims (staked by AngloGold) in the agreement. Effective December 31, 2005, a termination agreement was signed whereby AngloGold relinquished 100% ownership of the claims subject to an NSR of 2%, one-half of which can be purchased for US $2,000.000.  The ER-Ogo-Fire Property is underlain by gneisses of the Paleozoic Yukon-Tanana Terrane representing strongly metamorphosed sedimentary and igneous rocks. The gneisses are intruded by late Cretaceous aged granitic intrusions which outcrop extensively on the property. Gold-bearing quartz vein material has been sampled on a ridge lying between the two areas of intrusive outcrop.  Auger soil sampling surveys in 2003 expanded the geochemically anomalous area beyond that outlined by reconnaissance style surveys conducted in 2002. Results of the geochemical survey defined a 1,500 by 300 meter gold-arsenic-bismuth-antimony soil anomaly. Six diamond drill holes totaling 2,161 meters tested four widely spaced areas within the soil anomaly. A ground geophysical survey conducted late in the season appears to outline early granitic phases that are believed to form a prospective host rock for veining.   -60-  During 2004, AngloGold completed a NSAMT (Natural Source Audio Frequency Magneto-Telluric) geophysical survey, soil geochemical sampling and three drill holes totaling 997 meters on the ER project. Drilling further defined a northwest trending vein structure that is open to the northwest and downdip. Hole ER04-7, following up on a 0.5 meter intercept that assayed 63 grams per tonne gold in 2003, intersected 4.1 grams per tonne gold over 1.3 meters.  During 2006, Rimfire Alaska conducted a regional exploration program on these claims. Soil and silt sampling gave generally spotty anomalous results to the northwest of past drilling., However, a small cluster of anomalous gold in soils were obtained in association with large quartz boulders approximately 3.5 kilometers to the southwest of previous drilling. No work was completed on the ER-Ogo-Fire property during 2007.  During 2008, Rubicon funded an expanded reconnaissance and drilling exploration program which generated 359 rock samples and 9 pan concentrates. One high priority target was subsequently drilled. Three drill holes were completed at the ER target for a total of 335 meters. Two of these holes intersected narrow quartz veins with anomalous concentrations of gold in them.  Bou-Swede Property  The Bou-Swede group of claims is located along the Pogo Trend. Rimfire Alaska holds a 100% interest in the property with no underlying royalties. Rocks underlying the Bou property are almost exclusively granite. Mineralization on this property consists of quartz veins and mineralized and altered granite has been found in two general areas. At the Thunder showing, quartz vein boulders with gold, arsenic and antimony have been found over a 300 by 300 meter area, along the trace of a northeast trending fault structure. The Cairn showing lies 2 kilometers south of the Thunder and is defined by a gold-bearing quartz vein boulder train measuring 50 by 300 meters that extends along the trace of an east-west structure. Strongly anomalous gold, bismuth, arsenic and antimony soil anomalies extend beyond the current limits of sample coverage. In 2007, a combination of grid and reconnaissance mapping, prospecting and soil sampling was carried out on the Bou-Swede property.  Following analysis of previous field program results, the 2008 exploration program was designed to conduct project-scale prospecting and reconnaissance exploration work on areas not previously examined and to conduct prospect-scale mapping, sampling and follow-up drilling on targets not previously drilled.  Uncle Sam Property, Richardson Mining District, Alaska  The Uncle Sam Property, which consists of 194 claims covering 7,760 acres (3,140 hectares), is an intrusion-related gold target, located approximately 75 kilometres southeast of Fairbanks. It is hosted in a similar age of rocks to those which host the Pogo Gold Mine in east-central Alaska approximately 60 kilometres away. The Uncle Sam property was identified by reconnaissance ridge and spur soil sampling in 1999, augmented by power auger soil sampling and RC drilling in the first quarter of 2000. This work outlined a very large gold-in-soil anomaly in an area some 8 by 5 kilometers in size, but broken up by broad valleys in which deep overburden and permafrost prevented soil sampling.   -61-  On November 2, 2009 the Corporation signed an option agreement with Millrock Resources Inc. (Millrock) giving Millrock the option to earn a 100% interest in the Uncle Sam property in Alaska. Under the terms of the agreement Millrock will make cash payments totaling US$200,000 over four years with US$40,000 being paid upon TSX approval. In addition, Millrock will issue 1,000,000 shares to Kiska over four years and has made a commitment to spend US$2,700,000 on exploration over four years. There is an underlying 2% NSR payable to Royal Gold Inc.  Australia [kiskaannual20fa1005.jpg]  Lachlan Fold Belt Properties, New South Wales  Location and Introduction  The Lachlan Fold Belt in New South Wales Australia is richly endowed with a diversity of deposit types that host in excess of 150 million ounces of gold. Significant porphyry copper gold, epithermal gold, volcanogenic massive sulphide (VMS), gold-copper skarn, sediment-hosted disseminated gold and intrusion-related gold deposits are located within the belt.   -62-  Property Acquisition  The Corporation, through its wholly-owned subsidiary Rimfire Australia Pty. Ltd., (Rimfire Australia) holds two exploration licenses covering 27,513 hectares in the Lachlan Fold Belt, New South Wales, Australia. Rimfire Australia originally was granted nine licenses to encompass all available high-priority targets identified in a Neural Network data study conducted by a private company, BWG. BWG granted Rimfire Australia a two-year exclusive right to use the study's target maps and data to acquire licenses and conduct exploration in the 120,000-square-kilometer study area. Rimfire Australia paid a fee for use of the study and upon designation of project areas, Rimfire Australia paid additional fees based on project designation and exploration expenditures. BWG will retain a 2% net smelter royalty in all designated projects. During the two-year license period, Rimfire Australia completed the required eligible exploration expenditures of at least USD$150,000. Some of the licences were evaluated then cancelled when it was determined that the areas did not merit additional exploration.  The BWG study involved the compilation of Landsat, topography, geophysical (gravity, magnetic and radiometric), geochemical, lithological, structural geology and drilling databases. The neural network techniques applied to the databases yielded numerous high-priority targets, including the ones covered by Rimfire Australia's exploration license applications.  Rimfire Australia signed a Farm-in agreement with Inmet Mining (Australia) Pty. Ltd. to earn a 60% interest in the Barmedman Property on completion of the following:  Cash payments to the Corporation of: · A$50,000 within 5 days of the execution of the agreement (paid) · A$50,000 on or before March 31, 2010 · A$50,000 on or before March 31, 2010 · A$50,000 on or before March 31, 2011 · A$50,000 on or before March 31, 2012  Fund exploration expenditures of: · not less than A$400,000 on or before April 11, 2009 (completed) · an additional A$400,000 on or before March 31, 2010 · an additional A$1,000,000 on or before December 12, 2010 · an additional A$1,200,000 on or before December 12, 2011 · an additional A$2,000,000 on or before December 12, 2012  The specific tenements in the State of New South Wales in which the Corporation holds an interest are set out in the following table:


|          |                     |           |             
|--------- | ------------------- | --------- | ------------
|Name      | Exploration Licence | Size (Ha) | Expiry Date 
|Walmer    | 6781                | 12,439    | May 22, 2011
|Barmedman | 6782                | 15,074    | May 22, 2011

-63-  Regional Geology  The Eastern Lachlan Fold belt constitutes a subsection of the Tasman Fold Belt, which stretches from the Queensland-New South Wales border across Victoria and into Tasmania. The Neoproterozoic to Triassic orogenic belt preserves accreted arc and back-arc terrains and subduction zones sediments all of which were subjected to extensional and contractional tectonics. Silurian-Devonian post orogenic granitoids intrude the supracrustal rocks. Ordovician and Silurian island arc intermediate to mafic volcanics, sub-volcanics and intrusions of the Macquarie Arc, preserved as fault bound north-south trending belts, contain the bulk of the known copper-gold mineralization in the region. Furthermore, high grade copper-gold porphyry deposits are most closely constrained to distinctive alkalic magmatic suites.  Exploration  A limited property examination tour was conducted late in 2006. In early 2008, Rimfire Australia completed reconnaissance exploration programs on 5 of 9 licences in the Lachlan Fold Belt (Barmedman, Walmer, Gollan, Goulburn, and Mt. MacDonald) for a total of $330,000 in exploration. These programs consisted of soil and silt sampling, prospecting and geological mapping. In addition, Induced Polarization (IP) geophysical surveys were completed on the Barmedman and Walmer licences. The Barmedman survey consisted of 26 line-kilometer of dipole-dipole IP with 100 meter a spacing and 400 meter line spacing. The Walmer survey consisted of 10 line-kilometer of dipole-dipole IP with the same survey parameters. Both surveys were performed by Zonge Engineering and Research Organization Limited.  In September 2008, Rimfire Australia completed a diamond drilling program at the Trounce prospect on the Walmer property. This program was targeting geological and geophysical targets identified in the early 2008 reconnaissance exploration program. The Trounce prospect consists of a small outcropping of silicified sediments with quartz - pyrite veining and stockwork. Two of seven grab samples from the showing returned strongly anomalous gold values and the remaining five returned weakly anomalous gold values. On surface, the showing occurs within a subtle, north-south striking topographic high, coincident with anomalous gold soil geochemistry and a 40 meter-wide by 500 meter long induced polarization chargeability and resistivity high. The diamond drilling program consisted of four diamond drill holes totaling 287 meters which returned no significant results. No future work is planned at Trounce.  During early 2009, Rimfire Australia completed a soil sampling survey and diamond drilling program on the Barmedman exploration licence, targeting IP anomalies and Mobile Metal Ion (MMI) geochemical anomalies identified during the 2008 exploration program. This program, operated by Rimfire Australia, had a total budget of A$400,000 and was funded 100% by Inmet. The program consisted of eight line-kilometres of partial leach soil geochemistry over the IP anomaly. Partial leach geochemistry is a specialized geochemical method utilized to detect buried mineralization under transported cover. Kiska has tested this technique with orientation surveys over areas of known mineralization under deep overburden cover in the region and has found it to be effective in identifying buried copper-gold porphyry deposits. The diamond drilling program consisted of five diamond drill holes for a total of 1508 metres. Drilling targeted coincident IP and partial leach geochemical anomalies returning only weakly anomalous gold and copper results.  In late 2009, Kiska conducted soil geochemical surveys expanding on the work programs conducted earlier in the year. The program targeted two new areas: Target A, a 1.5 by 0.5 km area anomalous copper, gold and molybdenum soil geochemistry, and Target B, a 0.4 by 0.5 km area of anomalous copper geochemistry. Both target areas were identified via partial leach geochemical analyses. A drill  -64-  program started in early March consisting of approximately 900 metres of aircore/diamond drilling in three holes to target the copper geochemical anomalies.  The Qualified Person for this property is Mark Baknes, P.Geo. Vice President, Exploration for the Corporation. A technical report has not been filed for this project.  Future Exploration Programs  Additional exploration will depend on the results of the current drill program. Inmet will make their decision to continue the option upon receipt of the drill results.  Victoria Goldfields Properties  Location and Introduction  The Stawell Corridor is a 240 kilometer long belt bound by the Congee and Moyston faults and is anchored by Northgate Australian Ventures Corporation Pty. Ltd.s five million ounce Stawell Gold Mine. Mineralization at Stawell consists of gold-bearing quartz veins in iron-rich sediments associated with basalt centers. This deposit has been studied extensively, resulting in the identification of large-scale characteristics that can be used in the exploration for similar deposits elsewhere in the district. Geophysical techniques such as gravity and magnetics surveys have proven effective in targeting basalt centers associated with mineralization. These techniques will be important in evaluating the rest of the Stawell Corridor and refining targets for drilling.  Property Acquisition  Effective July 28th 2008, Rimfire Australia entered into a new exploration partnership with Northgate Minerals Corporation, which granted Rimfire Australia an option on its Stawell Corridor gold exploration properties in the State of Victoria, Australia.  Rimfire Australia agreed to conduct exploration to maintain the licenses in good standing for the current year (approximately A$370,000). Rimfire Australia can then elect to conduct further exploration on any or all three of the licenses, earning a 50% interest on each by funding exploration of A$500,000 per license by March 31, 2011 with a minimum expenditure of A$150,000 per property per year. Northgate then has the option on each license to: 1) carry out the next A$1.5 million to earn back a 10% interest (total 60%) and another 10% by reaching a production decision; 2) not participate and allow the Corporation to earn a 100% interest in the property by spending, or causing to have spent, an additional A$2 million over 4 years; or 3) participate in a 50/50 joint venture.   -65-  The specific tenements in the State of Victoria in which the Corporation holds an interest are set out in the following table:


|             |                     |           |                  
|------------ | ------------------- | --------- | -----------------
|Name         | Exploration Licence | Size (Ha) | Expiry Date      
|Murtoa       | 3941                | 29,475.25 | December 17, 2010
|Ararat South | 4695                | 38,151.41 | April 16, 2011   
|Dundonnel    | 4730                | 19,051.89 | November 18, 2011

Regional Geology  Interpretation of regional aeromagnetic and gravity imagery indicates that the Moornambool Metamorphic Complex, located along the western margin of the Stawell Zone of the Lachlan Fold Belt, (Vandenberg et al 2000) continues under Murray Basin unconsolidated sediments within the majority of EL3941. The Moornambool Metamorphic Complex is bounded by the Coongee Fault to the east and Moyston Fault to the west, forming a ~20 kilometer wide corridor (the Stawell Corridor) that hosts the majority of the 6 million ounces of gold endowment in the Ararat and Stawell areas.  The near surface geology of the Victoria Goldfields properties is dominated by unconsolidated Murray Basin sediments in the north, and Tertiary basalt cover rocks in the south. Interpretation of regional aeromagnetic and gravity imagery indicates that the Cambrian Moornambool Metamorphic Complex, located along the western margin of the Stawell Zone of the Lachlan Fold Belt, continues under the Murray Basin sediment and Tertiary basalt cover within the majority of the tenements. The Moornambool Metamorphic Complex is bounded by the Coongee Fault to the east and the Moyston Fault to the west, forming a ~20 kilometer (12.5 mile) wide corridor (the Stawell Corridor) that hosts the majority of the 6 million ounces of gold endowment in the Ararat and Stawell areas. Gold mineralization at Stawell is hosted by a reverse fault system in sulphidic sedimentary rocks on the western margin of a basalt dome. The basalt dome and sulphidic sedimentary rocks have traditionally been detected in the Stawell Corridor using a combination of detailed gravity and magnetic geophysics to see beneath the cover rocks.  Exploration  The Corporation will be exploring three licences, totaling 120 kilometers of the corridor length, representing all ground outside of a buffer around the Stawell Gold Mine. In addition to greenfields opportunities, more advanced targets exist including the 10 kilometer-long Murtoa target, which surrounds the Kewell gold resource. The Kewell resource, which Northgate has opted to exclude from this agreement, is reported to contain a non 43-101 compliant 100,000 ounce resource grading 6 grams per tonne gold defined by 25 drillholes. Additional targets include kilometer-scale gravity anomalies that have been confirmed through drilling to reflect basalt centers at depth, with coincident gold and pathfinder element geochemical anomalies on surface.  In 2009 the Corporation carried out orientation surveys employing partial leach geochemistry on the Murtoa, Ararat South and Dundonnell Licenses. Partial leach geochemistry is a specialized geochemical method utilized to detect buried mineralization under transported cover. Kiska has tested this technique with orientation surveys over areas of known mineralization under deep overburden cover in the region and has found it to be effective in identifying buried copper and gold deposits. Detailed gravity surveys and IP survey techniques were employed on the Ararat South and Dundonnell Licenses to identify  -66-  basaltic centres and sulphide mineralization. Both geochemical methods and geophysical surveys outlined encouraging exploration targets as well as confirming the utility of partial leach geochemistry in this type of environment.   The Qualified Person for this property is Mark Baknes, P.Geo. Vice President, Exploration for the Corporation. A technical report has not been filed for this project.  Future Exploration Programs  An Induced Polarization (IP) program and gravity geophysical program, to be conducted on targets on the Ararat South and Dundonnel licences, is planned for early 2010.   Mexico  [kiskaannual20fa1006.jpg] The Corporation holds 100% interest in nine properties in the states of Sonora, Sinaloa and Durango in Mexico. Each property is subject to a 2% NSR held by Minera Kennecott S.A. de C.V., a subsidiary of Rio Tinto.   -67-  Suaqui Verde  The Suaqui Verde property, which consists of three claims covering 5,518 hectares, is porphyry copper  molybdenum-gold target, located 130 kilometers south east of Hermosillo, the capital of Sonora State, Mexico. Two target areas exist on the property, Adriana on the western side, and the Suaqui Verde extension on the eastern side. Both targets are hosted in similar aged Laramide intrusive rocks that host the producing Cananea and La Caridad porphyry copper  molybdenum mines in Sonora State.  The Adriana target covers an area approximately 800 meters by 1000 meters where oxidized stockworks and potassically altered andesites and quartz monzonites occur and correspond with 500 meter by 500 meter copper soil anomaly. Limited drilling within this target has returned long intervals of anomalous copper mineralization. The Suaqui Verde extension target covers a 500 meter by 500 meter copper soil anomaly with associated copper oxide mineralization at the property boundary that has not been drill tested.  The Corporation is seeking a Joint Venture partner to advance the property. If no partner is found, the Corporation does not anticipate conducting any exploration on the property.  Cumobabi  The Cumobabi property, which consists of nine claims covering 40,864 hectares, is a porphyry and breccia copper  molybdenum-silver target, located 130 kilometers north east of Hermosillo, the capital of Sonora State, Mexico.  The main porphyry target at Cumobabi is a greater than 10 km2 airborne geophysical magnetic and gravity low with associated anomalous copper stream sediment data and clay/iron oxide alteration as interpreted from satellite imagery called Cerro Santine. This target is hosted in similar aged Laramide intrusive rocks that host the producing Cananea and La Caridad porphyry copper  molybdenum mines in Sonora State. The Cerro Santine target has not received any systematic exploration efforts. Breccia mineralization discovered by Kiska adjacent to this porphyry target at an area called Potreritos returned strongly anomalous copper and silver mineralization in limited drilling including, 26 meters of 0.55% copper and 4 grams/tonne silver and 9.15 meters of 2.65% copper and 21 grams/tonne silver.  The Corporation is seeking a Joint Venture partner to advance the property. If no partner is found, the Corporation does not anticipate conducting any exploration on the property.  La Palma  The La Palma property, which consists of one claim covering 5,400 hectares, is a porphyry copper  gold target, located 120 kilometers north east of Hermosillo, the capital of Sonora State, Mexico.  The property covers a 1000 meter by 600 meter copper  gold mineralized porphyry system as defined by soil and rock sampling. Host rocks to mineralization are monzonite and granodiorite intrusives of unknown age. Drilling in three holes has defined the mineralized system over 350 meters of strike and is open to depth and along strike in both directions. All drill holes returned long intervals of anomalous copper and gold mineralization in oxidized and mixed oxide/sulphide material at a near 1:1 copper to gold ratio. The sulphide core of the system remains largely untested. The Corporation is seeking a Joint Venture partner to advance the property. If no partner is found, the Corporation does not anticipate conducting any exploration on the property.  -68-  La Noria  The La Noria property, which consists of two claims covering 18,453 hectares, is a porphyry and breccia copper  molybdenum  silver - gold target, located 60 kilometers north east of Mazatlan in Sinaloa State, Mexico.  The main porphyry and breccia targets at La Noria are hosted in Laramide aged granodiorite intrusive rocks. Los Laureles is the premier breccia target discovered to date at La Noria and measures 750 meters by 250 meters at surface. It is a quartz-tourmaline breccia with pyrite, chalcopyrite and molybdenite mineralization. Drilling in five holes has returned moderate intervals of strongly anomalous molybdenum, copper and silver mineralization including, highlight drilling results of: 107 meters of 0.12% molybdenum, 0.14% copper and 11.8 grams/tonne silver and 67 meters of 0.08% molybdenum, 0.36% copper and 13.9 grams/tonne silver. El Naranjos, an example of porphyry related fracture hosted mineralization, is defined by a large zoned copper  molybdenum  silver soil anomaly measuring 1600 meters by 600 meters. Further target refinement and definition achieved by conducting induced polarization geophysics and drilling in six holes defined long intervals of anomalous copper and silver mineralization in three holes over 385 meters of strike length including, 171 meters of 0.1% copper and 2.2 grams/tonne silver and 83 meters of 0.12% copper and 2.3 grams/tonne silver.  Two large, unexplored soil anomalies also exist on the La Noria property that could be host to porphyry or breccia style mineralization called El Zapote and El Tiro. El Zapote is defined a 1500 meter by 700 meter copper  silver  molybdenum  lead  zinc soil anomaly. Limited rock trenching within the soil anomaly has returned short intervals of moderately anomalous silver, gold and copper mineralization. The El Tiro soil anomaly measures 2700 meters by 1200 meters and is anomalous in copper, silver and gold. Only two rock samples have been collected at El Tiro returning anomalous copper and silver concentrations. No geophysical surveys, trenching or drilling has been undertaken.  The Corporation is seeking a Joint Venture partner to advance the property. If no partner is found, the Corporation does not anticipate conducting any exploration on the property.  Cardelena  The Cardelena property, which consists of two claims covering 2,949 hectares, is a gold  silver vein target, located 130 kilometers south east of Hermosillo, the capital of Sonora State, Mexico.  The primary target at Cardelena is gold silver mineralization hosted in a series of east  west trending oxidized quartz +/- tourmaline veins peripheral to a quartz-tourmaline breccia body. Host rocks are Cretaceous aged andesitic volcanic and Laramide aged granodioritic intrusive rocks. Extensive cover gravels exist immediately to the east of the mineralized trend. Mineralization has been defined by trenching and drilling over 600 meters of strike before encountering gravels that cover the mineralization to the east. Mineralization occurs in, and adjacent to, veins ranging from 4 to 124 meters wide (not true width). Results from drilling include 27.4 meters of 2.04 grams/tonne gold and 9.9 grams/tonne silver and 28.26 meters of 0.69 grams/tonne gold and 6.5 grams/tonne silver in oxidized material.  The Corporation is seeking a Joint Venture partner to advance the property. If no partner is found, the Corporation does not anticipate conducting any exploration on the property.   -69-  Batacosa  The Batacosa property, which consists of one claim covering 3,591 hectares, is porphyry copper  molybdenum target, located 225 kilometers south east of Hermosillo, the capital of Sonora State, Mexico.  Batacosa covers a mineralized copper porphyry system defined by a 3000 meter by 1000 meter greater than 300 grams/tonne copper soil anomaly. Host rocks to mineralization consist of a Laramide aged granodiorite batholith intruded by porphyritic monzonite intrusives and breccias. These Laramide aged rocks are similar to those that host the producing Cananea and La Caridad porphyry copper  molybdenum mines in Sonora State. Mineralization is obscured to the south by younger cover rhyolite tuff volcanic rocks. A total of 25 historic reverse circulation and diamond drill holes conducted by Teck Resources and Phelps Dodge returned long intervals of anomalous copper mineralization including, 300 meters of 0.1% copper and 30 meters of 0.2% copper oxide.  The Corporation is seeking a Joint Venture partner to advance the property. If no partner is found, the Corporation does not anticipate conducting any exploration on the property.  San Nicolas  The San Nicolas property, which consists of one claim covering 2,631 hectares, is a porphyry and breccia copper  molybdenum target, located 180 kilometers southeast of Hermosillo, the capital of Sonora State, Mexico.  The San Nicolas property covers a portion of a large Laramide aged granodiorite intrusive batholith. These Laramide aged rocks are similar to those that host the producing Cananea and La Caridad porphyry copper  molybdenum mines in Sonora State. Little systematic exploration has taken place at San Nicolas, but mapping and sparse rock sampling has defined an area measuring 5000 meters by 3000 meters with phyllic alteration and anomalous copper geochemistry. Detailed targeting for porphyry style mineralization within this area has not been undertaken. Short widths of moderate molybdenum, silver and copper mineralization has been defined in drilling in a porphyritic monzonite rock on the edge of the La Buffa quartz tourmaline breccia body including, 3.6 meters of 0.14% molybdenum and 16 meters of 0.49% copper and 11.5 grams/tonne silver.  The Corporation is seeking a Joint Venture partner to advance the property. If no partner is found, the Corporation does not anticipate conducting any exploration on the property.  Arroyo Amarillo  The Arroyo Amarillo property, which consists of one claim covering 896 hectares, is a porphyry polymetallic vein copper  molybdenum  silver - lead target, located 5 kilometers north  northeast of San Nicolas and 180 kilometers south east of Hermosillo, the capital of Sonora State, Mexico.  Host rocks at Arroyo Amarillo are Cretaceous andesite volcanic rocks that form the basement to the same Laramide aged intrusive batholith encountered at San Nicolas. The property has received little systematic exploration, but extensive argillic and silicic alteration has been defined by mapping and observed in road cuts. Rock sampling of polymetallic vein mineralization has returned moderately anomalous gold, lead and silver values over average widths of 3 to 4 meters.   -70-  The Corporation is seeking a Joint Venture partner to advance the property. If no partner is found, the Corporation does not anticipate conducting any exploration on the property.  El Nilo  The El Nilo property, which consists of one claim covering 7,391 hectares, is an intrusive related gold stockwork target, located 100 kilometers north of Durango, the capital of Durango State, Mexico. The El Nilo property covers a conceptual airborne magnetics low geophysical target. This signature is similar to that of a gold  silver  zinc mineralized dacite porphyry located to the east of the property. The entire property is covered by gravels and younger rhyolite tuff rocks such that the target dacite porphyry is blind to the surface. No geophysical testing, such as induced polarization, or drilling has been conducted to test the target.  The Corporation is seeking a Joint Venture partner to advance the property. If no partner is found, the Corporation does not anticipate conducting any exploration on the property.  Nevada  Colorback and Hilltop Properties  The Corporation holds an interest in two mineral properties in located in Lander County, Nevada approximately 100 kilometers southwest of Elko. The Colorback property consists of 120 claims covering 2,400 acres (971 hectares) while the Hilltop property is comprised of 82 claims covering 1,640 acres (663 hectares). In 2008, a dispute arose with two other groups who hold Bureau of Land Management placer mining claims in the area and as a result the Corporation has subsequently agreed to relinquish approximately 50% of its lode claims to settle the dispute. Despite this relinquishment, the Corporation still retains valid lode claims covering the Discovery Zone and the Myers Hill prospects at Colorback.  The Colorback and Hilltop projects occur in the center of the prolific CortezBattle Mountain Trend. Mineralization on the property is hosted in a structurally overlapping package of Upper Plate siliciclastic rocks overtop Devonian Slaven Cherts, which are in turn intruded by Eocene granodiorite. Significant untested potential remains in these Upper Plate rocks in settings similar to those in the Battle Mountain district, however, the most compelling conceptual exploration model for the property involves testing the Lower Plate stratigraphy at depth in a setting analogous to the nearby Cortez and Pipeline deposits.  At the Discovery Zone, silicified breccias are associated with strongly developed faults and porphyritic intrusive rocks. In 2006, the Corporation drilled 3 short holes on the target intersecting oxidized breccias and numerous gold-bearing intervals. Significant mineralization has been produced from structural zones in Upper Plate rocks. Basic exploration techniques including sampling and ground geophysics would help to outline shallow targets in Upper Plate stratigraphy. This same work could also be designed to help focus deep drilling for targets in the Lower Plate stratigraphy.  No exploration program is planned for the Colorback and Hilltop properties in 2010. The Corporation is seeking joint venture partners to continue exploration on the property.   -71-  New Mexico  San Juan Property  The Corporation holds an interest in 51 mineral claims and 5 mining leases located in Socorro County New Mexico approximately 45 kilometers southwest of San Antonio, New Mexico. The claims contain gold-molybdenum-silver targets that are untested by drilling. Induced polarization surveys indicate that a chargeable body exists under cover material that could represent coppergoldsilver mineralized material. No exploration program is planned for the San Juan property in 2010. The Corporation is seeking joint venture partners to continue exploration on the property.  Estimated Administrative Expenditures  The Corporation expects that total administrative costs to carry out the Corporations proposed exploration and development programs for the period January 1, 2010 to December 31, 2010 will be approximately $1,770,750. The estimated administrative expenses will be financed from existing working capital. The estimated average monthly breakdown is as follows:  ITEMAverage Month12 Month PeriodAccounting & legal$9,667$116,000Insurance3,50042,000Investor services3,46041,520Management and director services19,583235,000Office6,43377,200Marketing and promotion45,282543,380Rent14,530174,360Salaries & support services43,899526,790Travel & entertainment1,20814,500TOTAL$147,562$1,770,750  ITEM 5   OPERATING AND FINANCIAL REVIEW AND PROSPECTS  Overview  The Corporation has no producing properties and, consequently, has no current operating income or cash flow from its mineral property exploration and development operations.  The Corporation did not engage, does not currently engage, nor does it expect to engage, in any hedging transactions to protect against fluctuations between Canadian currency and the U.S currency. The Corporations expenses are denominated in Canadian dollars.  The following discussion of the operating results and financial position of the Corporation should be read in conjunction with the Corporations consolidated financial statements (and related notes).   -72-  OPERATING RESULTS  The Corporation has commenced planning for transition of Canadian generally accepted accounting principles (Canadian GAAP) to International Financial Reporting Standards (IFRS) as developed by the International Accounting Standards Board. During the fiscal year ended December 31, 2009, the Corporation undertook a comprehensive review of IFRS and determined which standards will affect financial recording and reporting for the Corporation. It was determined that there will be no material differences between statements prepared under Canadian GAAP and those prepared according to IFRS. The differences are primarily presentation differences for the financial statements and extensive additional disclosure required under IFRS. The final transition date for Canadian GAAP to IFRS is for the fiscal year ended December 31, 2011. The requirements for transition stipulate extensive qualitative and quantitative disclosure of the changes starting with the first interim statements in 2010.  The Corporation adopted accounting recommendations of the Canadian Institute of Chartered Accountants for the recognition and measurement of financial instruments with related disclosure in a Statement of Comprehensive Income for the fiscal year ending December 31, 2007. At each balance sheet date, the Corporations financial instruments are measured at their fair value. Gains and losses are recognized in other comprehensive income for instruments considered to be available for sale and in net income for other instruments.  Year Ended December 31, 2009  For the year ended December 31, 2009 Kiska incurred a net loss of $18,684,503 ($0.51 per share) compared to a net loss of $16,260,741 ($1.84 per share) in the previous year, after taking into account the three for one share consolidation. The most significant factor contributing to the net loss is the mineral property acquisition costs associated with the acquisition of Rimfire Minerals Corporation. An impairment loss on these properties was recognized as at September 30, 2009 increasing the net loss by $7,974,288. Mineral property revenues decreased by 70% from $897,315 to $273,051 while interest revenue remained steady at $26,138 compared to $24,702. Exploration expenditures decreased by 12% ($6,530,166) from the previous year ($7,364,238). In the first half of the year, strenuous efforts were made to limit exploration to strategic initiatives in order to conserve cash. General and administrative expenses were reduced by 50% from the previous year, primarily related to the repayment of debt with significant reductions in financing expense.  Mineral property revenues decreased in the current year to $273,051 from $897,315 in the previous year as the Corporation concentrated on exploration of the Whistler property rather than managing exploration programs for other companies. In the first half of the year, management was seeking an agreement for the Corporation as a whole instead of negotiating joint venture and option agreements for individual properties. During the second half of the year, the Corporation commenced the process of disposition of mineral properties resulting in some option proceeds being reported for the second half of the year.  Exploration expenditures, excluding those by joint-venture partners, totaled $5,853,537 compared to $7,204,248 in 2008, and property acquisition expenditures totaled $330,598 compared to $158,990 in 2008. The majority of the exploration expenditures were made on the Whistler property in Alaska.  At the acquisition date, the mineral properties acquired from Rimfire Minerals were valued at $156,500. These costs were expensed in accordance with the Corporations accounting policies. At the end of the fiscal year, reclamation obligations for active properties were estimated and an expense of $355,829 was included in mineral property expenditures.  -73-  The British Columbia Mineral Exploration Tax Credit Program will reimburse the Corporation for 20% of eligible expenditures in that jurisdiction. For the fiscal year ended December 31, 2009 exploration tax credits are $9,798. The severity of the Mountain Pine Beetle infestation has resulted in designation of an area where the tax credit will be 30% rather than the previous 20%. Most of the Corporations active mineral properties fall within the designated zone. There were no exploration tax credits in 2008 as the Corporation renounced flow-through expenditures which would otherwise have been eligible for exploration tax credits.  The most significant change in general and administrative expense is financing expense. During the year ended December 31, 2009 all remaining debt was paid off resulting in total financing expense of $59,660 compared to the previous year financing expense of $3,565,047. The other significant changes were in salaries which were reduced from $1,615,644 in 2008 to $680,828 in 2009 and outsourced services which increased from $507,815 in 2008 to $1,073,104. Most of the increase in outsourced services relates to the corporate acquisition costs associated with the acquisition of Rimfire Minerals Corporation in August 2009. This is not expected to be a recurring cost.  Year Ended December 31, 2008  For the year ended December 31, 2008, the Corporation incurred a net loss of $16,260,741 (or $1.84 per share) on revenues of $897,315 compared with a net loss of $14,474,635 ($3.73 per share) on revenues of $1,358,045 for the year ended December 31, 2007. The increased loss in 2008 was the result of a foreign exchange loss of $3,130,547 and higher financing fees associated with a convertible loan facility and bridge loan, both of which were repaid during the year, offset by lower exploration expenses.  Revenues for the year ended December 31, 2008 totaled $897,315 compared with revenues of $1,358,045 for the same period in 2007. The decrease is the result of the Corporation managing fewer exploration programs in 2008 than in 2007. The Corporation does not anticipate incurring the same level of revenues going forward as it is focusing resources on the development of its own property portfolio.  Salaries & employee benefits expense decreased to $1,615,644 for the year ended December 31, 2008 from $2,549,385 for the year ended December 31, 2007. The decrease is due to lower salaries from the Australian operations as employment levels were significantly reduced during 2008. Selling, general and administrative expense for the year ended December 31, 2008 was $1,126,200 compared with $1,736,104 in 2007, a decrease of 35%. The decrease is due to lower general and administrative expenses, traveling expenses and communication costs in 2008 as the Corporation focused on cost cutting initiatives. Consulting and outsourced services decreased from $971,895 in 2007 to $513,723 in 2008, due to lower legal expenses as the Corporation entered into fewer earn-in arrangements with strategic partners during 2008 than 2007.  Exploration expenditures were $7,364,238 in 2008 compared to $11,863,030 in 2007. The decrease is due to the winding down of the Master Strategic Alliance Agreement (MSAA) as the Corporation completed its exploration and financial obligations pursuant to the MSAA during 2008. The Corporation completed exploration programs on its Whistler Project, Redton Project, Ontario projects and Mexican projects.   -74-  The Corporation accounts for stock options using the fair-value method under which compensation expense for stock options granted is valued at the date-of-grant using the Black-Scholes valuation model and is recognized as stock-based compensation expense over the vesting period of the options. The Corporation recognized $76,461 for the year ended December 31, 2008 compared with $761,482 in the year ended December 31, 2007.  Financing expenses were $3,565,047 for year ended December 31, 2008 compared with $2,359,900 for the year ended December 31, 2007. Financing expenses for the year ended December 31, 2008 include $2,465,774 (2007 - $1,157,426) in accretion expense and $943,328 (2007 - $1,001,979) in interest both in connection with a convertible loan facility. Interest income was $24,702 and $381,149 for the years ended December 31, 2008 and 2007, respectively.  The Corporation recorded a foreign exchange loss of $3,130,547 during the year ended December 31, 2008 in connection with the repayment of the convertible loan facility on October 17, 2008 which was denominated in US dollars. Included in the foreign exchange loss is an amount of $428,000 on a bridge loan which was drawn in US dollars due to the weakening of the Canadian dollars relative to the US dollar.  Year Ended December 31, 2007  For the year ended December 31, 2007, the Corporation incurred a net loss of $14,474,635 ($3.73 per share) on revenues of $1,358,045 compared with a net loss of $9,868,724 ($3.25 per share) on revenues of $1,728,740 for the year ended December 31, 2006. The increased loss in 2007 was the result of higher exploration expenses on the Corporations exploration projects and financing expenses in connection with a convertible loan facility offset by a dilution gain and interest income.  On July 7, 2007, the Corporation recorded a dilution gain of $1,646,124 in the statement of operations upon the successful listing of Clancy Exploration Limited (Clancy) on the Australian Stock Exchange on July 7, 2007. On the same date, Clancy closed its initial public offering of 25,000,000 common shares at a price of A$0.20 per common share for gross proceeds of A$5,000,000. The Corporation did not participate in the public offering and as a result its ownership interest decreased from 100% to 47.7%. At that time the Corporation ceased to consolidate Clancys results and began using the equity method.  Revenues for 2007 totaled $1,358,045, representing a decrease of 21% from revenues of $1,728,740 in 2006. The decrease is due to the reduction of exploration management fees earned by the Corporations wholly-owned subsidiary, Clancy.  Salaries & employee benefits expense remained consistent with 2006 with $2,549,385 being incurred in the year ended December 31, 2007 and $2,557,338 being incurred for the same period in 2006. Selling, general and administrative expense for the year ended December 31, 2007 was $1,736,104 compared with $2,233,320 in 2006, a decrease of 22%. The decrease is due to lower traveling expenses incurred in 2007 and lower communication costs. Consulting and outsourced services decreased from $1,488,474 in 2006 to $971,895 in 2007, due to legal fees incurred in 2006 for the preparation and execution of the MSAA and security documentation for the Corporations Great Basin properties in connection with the short-term note payable. Depreciation and amortization was $211,426 for the year ended December 31, 2007 and $208,810 for the year ended December 31, 2006. The slight increase is due to additional  -75-  computer equipment and furniture and fixtures for the Mexican office. Exploration expenditures increased significantly in 2007 to $11,863,030 compared with $4,834,206 in 2006, due to the acquisition and aggressive exploration of the Corporations exploration portfolio in Alaska, Utah, British Columbia, Mexico and Nevada, mainly pursuant to the terms and commitments under the MSAA.  The Corporation accounts for stock options using the fair-value method under which compensation expense for stock options granted is valued at the date-of-grant using the Black-Scholes valuation model and is recognized as stock-based compensation expense over the vesting period of the options. The Corporation recognized $761,482 in the year ended December 31, 2007 compared with $444,835 for the prior year. Financing expenses were $2,359,900 for the year ended December 31, 2007 compared with $354,222 for the year ended December 31, 2006. The increase is due to a commitment fee, 5% interest payable and an accretion expense of $1,157,426 on the convertible loan facility which is held by a related party.  The Corporation drew down US$10 million on January 16, 2007 and April 3, 2007, respectively, for total proceeds of US$20 million under a convertible loan facility. The gross proceeds were allocated to the relative fair values of the loan (US$8,141,300 and US$7,981,192) and the holders option to convert the principal balance into common shares (US$1,858,700 and US$2,018,808) (the Conversion Option). The US$16,122,492 fair value of the loan is classified as a liability, while the US$3,877,508 allocated to the Conversion Option is classified as a separate component within shareholders equity. Over their three year term, the loans are accreted to their face value through a periodic charge to accretion expense with a corresponding credit to the liability component. The accretion expense is based on the effective interest rate method.  For the year ended December 31, 2007, the Corporation recorded accretion expense of $1,157,426 related to the loans, which is included in financing expense. Interest income was $381,149 and $33,038, for the years ended December 31, 2007 and 2006, respectively. The increase is due to the drawdown of US$20 million under a convertible loan facility which was drawn down in two separate tranches during 2007. Funds were invested in short-term term deposits which earned interest at a rate of 5% to 5.31% per annum.  LIQUIDITY AND CAPITAL RESOURCES  LIQUIDITY  Year Ended December 31, 2009  The Corporations working capital as of December 31, 2009 was $1,563,862 comprised primarily of cash and term deposits, compared to $652,131 at the end of the previous fiscal year. The term deposits are intended to take advantage of higher returns available with slightly less liquidity while maintaining the integrity of the principal invested. These investments have maturities ranging from 4 months to one year at rates up to 1% above those available on cash in the bank. The increase in working capital is attributable to the acquisition of Rimfire Minerals and completion of a brokered private placement during the third quarter of 2009. The Corporation arranged a private placement subsequent to the end of the year which provided sufficient working capital for the Corporations present requirements.  The Companys cash and cash equivalents balance at December 31, 2009 was $1,071,695 compared with $762,560 at December 31, 2008. In addition, the Company has restricted cash of $202,707 (2008-$82,228) representing reclamation and performance deposits for mineral properties.  -76-  The Corporations number of issued and outstanding shares was 56,741,361 at December 31, 2009. The one for three consolidation and issue of 22,365,258 share to Rimfire shareholders, effective August 5, 2009, as part of the corporate acquisition accounts for most of the difference from 25,235,276 common shares that were issued and outstanding at the previous fiscal year-end. During the year, 3,353,328 employee stock options were granted at a weighted average strike price of $0.65 and 1,520,896 options expired or were forfeited. 140,827 options were exercised at a weighted average price of $0.42. At the end of the year, the balance of options outstanding was 4,383,844 with expiry dates up to December 2014.  On September 16, 2009, the Corporation completed a brokered private placement consisting of 9,000,000 units at $0.55 for gross proceeds of $4,950,000. Each unit consisted of one common share and one half of one non-transferable share purchase warrant. Each whole warrant entitles the holder to purchase one common share at a price of $0.80 per share until March 16, 2011. The terms of the warrants provide that if, during the term of any unexercised warrant commencing on January 17, 2010, the closing price of the common shares of the Corporation on any exchange is greater than $1.10 for a period of 20 consecutive trading days the Corporation may, at its option and by notice in writing to each holder, require the holder of the warrant to exercise such warrant within 30 days, failing which the warrant will be deemed to have expired. The units issued under the offering were subject to a four-month hold period expiring on January 17, 2010. The funds from this placement were utilized to continue the exploration of the Whistler project and for general corporate purposes.  A cash commission of 6% of the total gross proceeds realized from the placement was payable in cash together with 540,000 agents warrants, equal to 6% of the number of units placed. Each agents warrant will entitle the holder to purchase one common share at a price of $0.80 per share until March 16, 2011  Subsequent to year end, the Corporation arranged a non-brokered private placement of 9,092,500 units at a price of $0.66 per unit, for gross proceeds of $6 million. Each unit consisted of one common share and one-half of one non-transferable share purchase warrant. Each whole warrant entitles the holder to purchase, for a period of one year from the closing of the private placement (the "Closing"), one common share at a price of $0.92 per share. The warrants will contain a provision that will enable the Corporation to force exercise of the warrants if, during the term of any unexercised warrant commencing four months after the Closing, the common shares of the Corporation trade on any exchange for a period of 20 consecutive trading days at a price of $1.40 per share or greater. This placement closed in two tranches on March 2 and March 11, 2010. The Corporation paid share issue costs of $218,300 and issued 135,300 Brokers Warrants in connection with the financing. Net cash proceeds were $5,782,750. A total of 9,092,500 shares were issued subject to a four-month hold and 4,546,250 share purchase warrants exercisable at $0.92 for one year from the Closing. The funds raised will be used to further exploration of the Whistler Project and for general corporate purposes.  The Corporations financial instruments are all fully cashable at any time so there are no restrictions on availability of funds. There is no long-term debt. The Corporations current obligations include sublease commitments for office space. The lease for head office space expires November 30, 2010. Lease commitments for the remainder of the current fiscal year total $95,555. Other current obligations are statutory withholding and payroll taxes.   -77-  Year Ended December 31, 2008  The Corporations working capital as of December 31, 2008 was $652,131 compared to $5,956,907 at the end of the previous fiscal year. The decrease in working capital is attributable to the funding of exploration activities during the year.  On October 10, 2008, the Corporation closed a $5.5 million short-term bridge loan (the Bridge Loan) with Geologic Resource Partners LP (GRP), allowing it to draw down, as necessary, the full amount of the Bridge Loan. The Corporation had drawn a total of US$2.5 million under the Bridge Loan as at October 10, 2008. GRP is the investment manager for a group of funds (collectively GRF) who owned approximately 17% of the outstanding common shares of the Corporation as at October 10, 2008.  Advances under the Bridge Loan bore interest at a rate equal to 12% per annum. The Bridge Loan matured on March 2, 2009, subject to GRPs right to accelerate repayment in the event of a default under the Bridge Loan. As security for the Bridge Loan, the Corporation pledged all of the shares of its direct material subsidiary. On October 20, 2008, the Corporation closed a private placement and used a portion of those proceeds to repay the US$2.5 million outstanding balance of the Bridge Loan. The Corporation incurred a total of $33,014 in interest charges during the term of the Bridge Loan which is included in its statement of operations.  On December 22, 2008, the Corporation completed a 1 for 10 stock consolidation which had been approved at a special meeting of shareholders held on October 15, 2008.  On October 17, 2008, the Corporation completed a private placement with GRP raising gross proceeds of $29,328,000 by issuing 19,552,000 common shares at a price of $0.15 per common share. The proceeds from the financing were used to (i) repay the convertible loan facility in the amount of US$20 million held by GRF; (ii) repay US$2.5 million of advances under a bridge loan made by GRP; and (iii) for working capital purposes. Net cash proceeds received by the Corporation were $2,521,500. The private placement was approved by the Corporations shareholders at the Corporations special meeting of shareholders held in Vancouver, British Columbia on October 15, 2008. Minority shareholders (which excluded GRF) voted 97% in favour of the transaction.  In addition, Kiska issued 1,065,907 common shares to GRF in satisfaction of the interest on the convertible loan facility for the period of January 1, 2008 to October 16, 2008.  On March 30, 2008, the Corporation renounced the right to the deduction of exploration expenditures for income tax purposes in the amount of $3,486,230 in connection with the exercise of flow-through warrants in June, July and August 2007. The future income tax liability created by the renunciation amounted to $1,167,887 which has been charged to share issue costs. The renunciation of flow-through benefits resulted in an income tax recovery on the Consolidated Statement of Operations since the tax losses represented by these benefits are not likely to be realized by the Corporation.  The Corporations number of issued and outstanding shares was 25,235,276 at December 31, 2008, after giving effect to the one for ten consolidation in 2008 and the subsequent one for three consolidation in 2009. During the year, 3,600 employee stock options were granted at a strike price of $7.50 and 188,275 options expired or were forfeited. 18,300 options were exercised at a weighted average price of $5.40. At the end of the year, the balance of options outstanding was 134,808 with expiry dates up to March 2012.   -78-  Year Ended December 31, 2007  The Corporations working capital as of December 31, 2007 was $5,956,907 compared to $5,903,355 at the end of the previous fiscal year. The increase in working capital is attributable to marketable securities acquired in 2007 and input tax credits as a result of higher exploration expenditures eligible for the credit.  In January 2007, the Corporation drew down US$10 million under a convertible loan facility with a related party. In April 2007, a further US$10 million was drawn upon. The proceeds of the facility were used to fund the exploration expenditure obligation under the MSAA.  The Corporations number of issued and outstanding shares was 4,486,560 at December 31, 2007 after giving effect to subsequent share consolidations in 2008 and 2009. The warrants from the 2006 placement (see paragraph immediately below) represented most of the increase from the 3,789,763 common shares that were issued and outstanding at the previous fiscal year-end. During the year, 140,500 employee stock options were granted and 3,327 options were exercised. A total of 64,183 option expired or were forfeited. At the end of the year, the balance of options outstanding was 337,783.  On December 15, 2006, the Corporation completed an equity financing raising gross proceeds of $4,272,808 from the issuance of 791,261 flow-through units at a price of $5.40 per unit. Each unit consisted of one flow-through common share and one flow-through common share purchase warrant. Each flow-through warrant entitled the holder to purchase one common share to be issued on a flow-through basis at a price of $0.20 per share until August 15, 2007. The Corporation could accelerate this expiry date if the closing price of the Corporations common shares on the TSX Venture Exchange exceeded $0.40 for not less than 20 consecutive days in any 30-day trading period. On March 12, 2007, the Corporation renounced the right to the deduction of exploration expenditures for income tax purposes in the amount of $4,272,808 in connection with the flow-through shares issued on December 15, 2006. The future income tax liability created through the renunciation amounted to $1,538,338 which was charged to share issue costs in 2007.  General Liquidity Considerations  The Corporation holds an interest in a number of exploration properties with respect to which certain cash payments, exploration expenditures and share issuances are required to maintain the Corporations interests in such properties. The nature of the Corporations interest in its properties and the financial obligations associated with maintaining such interests are set out for the specific properties under Item 4, in the section entitled Property, Plants and Equipment contained within this transition report on Form 20-F.  For those of the Corporations properties acquired through the staking of claims, a failure by the Corporation to incur exploration expenditures or make cash payments to the appropriate government agency in lieu of exploration expenditures will result in the forfeiture of the title to the mining claims back to Alaska, Nevada, British Columbia or Yukon Territorial government, as the case may be. Once forfeited, the areas previously covered by the claims will be available for staking by other parties.  In the event that the Corporation does not fulfill its obligations under the terms of any of its option agreements, such agreement or agreements will terminate and title to the property will revert to the grantor of the original option.   -79-  CAPITAL RESOURCES  Year Ended December 31, 2009  The Corporations objectives when managing capital are to safeguard the Corporations ability to continue as a going concern in order to pursue the development of its mineral properties. The Corporation considers its capital to be shareholders equity and working capital. The Corporation manages and adjusts its capital structure when changes to the risk characteristics of the underlying assets or changes in economic conditions occur. To maintain or adjust the capital structure, the Corporation may issue new shares or acquire or dispose of mineral property interests.  In order to facilitate the management of its capital requirements, the Corporation prepares annual expenditure budgets which are revised periodically based on the results of its exploration programs, availability of financing and industry conditions. Annual and materially updated budgets are approved by the Board of Directors.  The Corporation does not pay out dividends in order to maximize cash available for ongoing development expenditures. The Corporations investment policy is to invest any excess cash in liquid short-term interest-bearing instruments with maturities one year or less. When utilized, these instruments are selected with regard to the expected timing of expenditures from continuing operations.  During the fiscal year ended December 31, 2009, the Corporation used $8,330,702 of its cash resources for operating activities, which included a net loss for the year of $10,866,715. This reflects the emphasis on exploration activity subsequent to the corporate acquisition and the acquisition expenses which totaled $633,875. The Corporation increased cash resources by $90,099 from the sale of marketable securities received as mineral property option proceeds. The Corporation issued 9,000,000 shares for cash proceeds of $4,950,000 pursuant to a brokered private placement. An additional 140,827 shares were issued upon exercise of options for proceeds of $59,552. Total share issue costs were $590,618. As of December 31, 2009, consolidated cash amounted to $1,071,695, an increase of $309,135 from the beginning of the year. Non-cash costs associated with the acquisition were primarily the exchange of Kiska shares for Rimfire shares and the conversion of existing employee stock options to new stock options.  It is anticipated that the Corporation will continue to use significant cash resources for mineral property expenditures as exploration and development of the Corporations mineral property interests is the primary focus of the Corporation. The Corporation budgets exploration programs carefully to ensure that funds are available when required and that expenditures do not exceed available resources. In the event that cash flows are predicted to exceed available cash, programs would be scaled back to where they could be funded from available cash. The Corporation will continue to sell marketable securities when the price is appropriate.   -80-  Year Ended December 31, 2008  During the fiscal year ended December 31, 2008, the Corporation used $9,559,189 of its cash resources for operating activities, which included a net loss for the year of $16,260,741. During the year, the Corporation issued 19,552,000 shares for net proceeds of $29,328,000 in a private placement. An additional 1,178,416 shares with a value of $1,440,335 were issued in satisfaction of interest. 18,300 shares with a value of $173,594 were issued pursuant to share purchase options. Total share issue costs were $1,235,721. As of December 31, 2008, consolidated cash amounted to $762,560, a decrease of $1,962,862 from the beginning of the year.  During the fiscal year ended December 31, 2008, the Corporation converted debt to equity by issuing shares in satisfaction of interest and by using the proceeds from a private placement to repay debt. The Corporation does not expect to use this strategy in future. Instead the Corporation will arrange private placements to raise the necessary financing for mineral property exploration programs.  Year Ended December 31, 2007  During the year ended December 31, 2007, the Corporation used $16,154,566 of its cash resources for operating activities, which included a net loss for the year of $14,474,635. The Corporation was in the first years of a strategic alliance agreement with Kennecott which required substantial exploration expenditures. The Corporation increased cash resources by $59,879 from the sale of marketable securities. During the year, the Corporation issued 581,039 shares for net proceeds of $3,503,381. There were share issue costs of $91.896. As of December 31, 2007, consolidated cash amounted to $2,725,422, an increase of $995,523 from the beginning of the year. In addition, the Corporation held $2,660,227 as cash restricted for flow-through expenditures which were used for eligible mineral property expenditures during 2008.  RESEARCH AND DEVELOPMENT, PATENTS AND LICENSES, ETC.  Not Applicable.  TREND INFORMATION  The Corporation does not know of any trends, demands, commitments, events or uncertainties that will result in, or that are reasonably likely to result in, the Corporations liquidity either materially increasing or decreasing at present or in the foreseeable future. Material increases or decreases in the Corporations liquidity will be substantially determined by the success or failure of the Corporations exploration programs or the future acquisition of projects.  Current equity market conditions are somewhat volatile as world economies commence recovery from the global economic crisis. This will make it more challenging for the Corporation to generate cash through the sale of marketable securities. Equity financing will be possible but may result in substantial dilution for current shareholders at current market prices for the Corporations shares.  OFF-BALANCE SHEET ARRANGEMENTS  The Corporation does not utilize off-balance sheet arrangements.   -81-  CONTRACTUAL OBLIGATIONS


|                                                 |                        |              |            |                   |           
|------------------------------------------------ | ---------------------- | ------------ | ---------- | ----------------- | ----------
|Contractual Obligations                          | Payments due by period
|Total                                            | Less than 1 year       | 1-3 years    | 3-5 years  | More than 5 years
|Long-Term Debt Obligations                       | Nil                    | Nil          | Nil        | Nil               | Nil       
|Lease Obligations [1]                            | $     95,555           | $   95,555   | Nil        | Nil               | Nil       
|Mineral Property Interests  Option Payments [2] | 1,019,882              | 196,132      | 357,500    | 230,000           | 236,250   
|Mineral Property Interests  Filing Fees[2]      | 3,216,998              | 561,046      | 1,138,727  | 680,203           | 837,022   
|Other Long-Term Liabilities [3]                  | 388,214                | 388,214      | Nil        | Nil               | Nil       
|Total                                            | $   4,720,649          | $  1,240,947 | $1,496,227 | $910,203          | $1,073,272

[1]Sublease agreement is effective until November 30, 2010. [2]Mineral property interest costs are contingent on retaining an interest in the property. Most agreements are subject to cancellation without penalty. This table does not include fees which other parties are obligated to pay. Filing fees, which include claim rental fees and tenement taxes, do not have to be paid if the property is forfeited to the appropriate government authority. [3]Canadian GAAP requires the Corporation to estimate the asset retirement obligation for each mineral property. The amount on this line is the current mineral property reclamation obligation as shown in the Corporations financial statements.    ITEM 6   DIRECTORS, SENIOR MANAGEMENT AND EMPLOYEES  Not Amended  ITEM 7    MAJOR SHAREHOLDERS AND RELATED PARTY TRANSACTIONS  Not Amended   ITEM 8   FINANCIAL INFORMATION  CONSOLIDATED STATEMENTS AND OTHER FINANCIAL INFORMATION  The following financial statements are attached and incorporated herein:   -82-


|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          | 
|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | 
|Description of Statement

Consolidated Balance Sheets for the fiscal years ended December 31, 2009 and 2008
Consolidated Statements of Operations, Consolidated Statements of Cash Flows,
Consolidated Statements of Comprehensive Loss,
Consolidated Statements of Shareholders Equity, and
Consolidated Statements of Mineral Property Expenditures
all for the fiscal years ended December 31, 2009 2008, and 2007
Notes to Consolidated Financial Statements
Management Discussion and Analysis for the year ended December 31, 2009 | 

There are no legal or arbitration proceedings, including those relating to bankruptcy, receivership or similar proceedings and those involving any third party, which may have, or have had in the recent past, significant effects on the Corporation's financial position or profitability.  The Corporation has not paid any dividends since its incorporation and does not anticipate the payment of dividends in the foreseeable future. At present, the Corporations policy is to retain earnings, if any, to finance exploration on its properties. The payment of dividends in the future will depend upon, among other factors, the Corporations earnings, capital requirements and operating conditions.  SIGNIFICANT CHANGES  Based on further analysis and review subsequent to April 26, 2010, the Corporation has concluded that that the characterization of $7,817,788 as goodwill was inappropriate under Canadian GAAP. The Corporation has determined that the appropriate method of accounting for the events which occurred after the completion of the acquisition transaction, including the change in the board and management, and the detailed review of the Corporations properties and operations, is on a prospective basis. Therefore the consolidated financial statements for the year ended December 31, 2009 and the Management Discussion and Analysis for the year ended December 31, 2009 have been restated and re-issued.  ITEM 9   THE OFFER AND LISTING  Not Amended  ITEM 10   ADDITIONAL INFORMATION  Not Amended  ITEM 11   QUANTITATIVE AND QUALITATIVE DISCLOSURE ABOUT MARKET RISK  Not Amended  ITEM 12   DESCRIPTION OF SECURITIES OTHER THAN EQUITY SECURITIES  Not Amended     -83-  PART II  ITEM 13   DEFAULTS, DIVIDEND ARREARAGES AND DELINQUENCIES  Not Amended  ITEM 14   MATERIAL MODIFICATIONS TO THE RIGHTS OF SECURITY HOLDERS AND USE OF PROCEEDS  Not Amended  ITEM 15   CONTROLS AND PROCEDURES  Not Amended    ITEM 16A   AUDIT COMMITTEE FINANCIAL EXPERT  Not Amended  ITEM 16B   CODE OF ETHICS  Not Amended   ITEM 16C   PRINCIPAL ACCOUNTANT FEES AND SERVICES  Not Amended   ITEM 16D   EXEMPTION FROM THE LISTING STANDARDS FOR AUDIT COMMITTEES  Not applicable  ITEM 16E   PURCHASES OF EQUITY SECURITIES BY THE ISSUER AND AFFILIATED PURCHASERS  Not applicable    ITEM 16F   CHANGE IN REGISTRANTS CERTIFYING ACCOUNTANT  Not Amended  ITEM 16G   CORPORATE GOVERNANCE  Not applicable   -84-  PART III     ITEM 17   FINANCIAL STATEMENTS  The following financial statements are attached and incorporated herein:


|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             | 
|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | 
|Description of Statement

Consolidated Balance Sheets for the fiscal years ended December 31, 2009 and 2008
Consolidated Statements of Operations, Consolidated Statements of Cash Flows,
Consolidated Statements of Comprehensive Loss,
Consolidated Statements of Shareholders Equity, and
Consolidated Statements of Mineral Property Expenditures
all for the fiscal years ended December 31, 2009, 2008, and 2007
Notes to Consolidated Financial Statements
Management Discussion and Analysis for the year ended December 31, 2009
Schedule II  Valuation Allowance | 

ITEM 18   FINANCIAL STATEMENTS  Not amended  -85-  ITEM 19   EXHIBITS


|               |                                                                                                                                                 |         
|-------------- | ----------------------------------------------------------------------------------------------------------------------------------------------- | --------
|Exhibit Number | Description                                                                                                                                     | Footnote
|1.1            | Amended Articles of Incorporation effective August 5, 2009                                                                                      | (2)     
|3.1            | Voting Agreements between Geoinformatics shareholders, Geoinformatics Exploration Inc. and Rimfire Minerals Corporation effective June 11, 2009 | (3)     
|4.30           | Management Contract between Equity Exploration Consultants Ltd. and Kiska Metals Corporation effective January 1, 2010                          | (2)     
|4.31           | Line of Credit Agreement between Geologic Resource Partners LLP and Geoinformatics Exploration Inc. effective March 9, 2009.                    | (2)     
|4.32           | Partial Termination Agreement and First Amendment Thereto between
Kennecott Exploration Company and the Corporation effective May 15, 2009      | (2)     
|4.33           | Acquisition Agreement between Geoinformatics Exploration Inc. and Rimfire Minerals Corporation effective June 11, 2009                          | (4)     
|4.34           | Amended Standardization Agreement between Geoinformatics Exploration Inc.
And Kennecott Exploration Company effective June 12, 2009             | (2)     
|8.1            | List of Subsidiary Companies of Kiska Metals Corporation                                                                                        | (2)     
|12.1           | Sarbanes-Oxley Section 302 Certification by Chief Executive Officer                                                                             | (1)     
|12.2           | Sarbanes-Oxley Section 302 Certification by Chief Financial Officer                                                                             | (1)     
|13.1           | Sarbanes-Oxley Section 906 Certification by Chief Executive Officer                                                                             | (1)     
|13.2           | Sarbanes-Oxley Section 906 Certification by Chief Financial Officer                                                                             | (1)     
|15.1           | Letter/Consent from former principal accountant Ernst & Young LLP                                                                               | (2)     
|15.2           | Letter/Consent from former principal accountant McGovern, Hurley, Cunningham, LLP                                                               | (2)     

(1) Filed as exhibits to this amended transition report on Form 20-F/A-1 for the fiscal year ended December 31, 2009.  (2) Filed as exhibits to the transition report on Form 20-F for the fiscal year ended December 31, 2009 as filed on April 23, 2010.  (3) Filed under cover of Form 6-K on EDGAR effective June 22, 2009.  (4) Filed under cover of Form 6-K on EDGAR effective June 19, 2009.   -86-  SIGNATURES The registrant hereby certifies that it meets all of the requirements for filing on Form 20-F and that it has duly caused and authorized the undersigned to sign this Transition Report on its behalf.   KISKA METALS CORPORATION  By:Jason S. WeberJason S. WeberPresident & Director  Date: November 24, 2010    -87-


KISKA METALS CORPORATION  Schedule II - Valuation Allowance


|                                             |  |                              |                                             |               |           |                       
|-------------------------------------------- |  | ---------------------------- | ------------------------------------------- | ------------- | --------- | ----------------------
|Classification                               |  | Balance at beginning of year | Additions charged to costs and expenses [1] | Deductions[2] | Other[3]  | Balance at end of year
|                                             |  |                              |                                             |               |           |                       
|Valuation Allowance for Deferred Tax Assets: |  |                              |                                            
|Year Ended                                   |  |                              |                                             |               |           |                       
|2009                                         |  | $(14,304,581)                | $(3,847,795)                                | $1,088,589    | $(71,062) | $(17,134,849)         
|2008                                         |  | (10,175,459)                 | (4,470,053)                                 | 1,019,800     | (678,869) | (14,304,581)          

[1] The 2008 and 2009 increases in the valuation allowance for deferred tax assets are related to the tax effect of current period losses and deductible temporary differences. [2] The decrease in valuation allowance for deferred tax assets reflects changes in the enacted tax rate applicable to the Corporation. [3] Other changes reflect the tax effect of fair value of marketable securities.


-88-    [kiskaannual20fa1007.jpg]  Kiska Metals Corporation (formerly Geoinformatics Exploration Inc.)   Consolidated Financial Statements Years Ended December 31, 2009, 2008 and 2007  AMENDED AND RESTATED     Amended and Restated  KISKA METALS CORPORATION   MANAGEMENTS RESPONSIBILITY FOR FINANCIAL REPORTING  The accompanying consolidated financial statements of Kiska Metals Corporation and all information in this annual report are the responsibility of management. The consolidated financial statements have been prepared in accordance with Canadian generally accepted accounting principles and, where appropriate, include managements best estimates and judgments. Management has reviewed the financial information presented throughout this report and has ensured it is consistent with the consolidated financial statements.  Management maintains a system of internal controls designed to provide reasonable assurance that assets are safeguarded from loss or unauthorized use, and that financial information is timely and reliable.  The Board of Directors is responsible for ensuring that management fulfils its responsibilities for financial reporting and is ultimately responsible for reviewing and approving the consolidated financial statements. The Board carries out this responsibility principally through its Audit Committee.  The Board of Directors appoints the Audit Committee, and all of its members are independent directors. The Audit Committee meets periodically with management and the shareholders auditors to review the financial statements and reports prepared by management, internal controls, audit results, accounting policies and related matters. The Board of Directors approves the consolidated financial statements on recommendation from the Audit Committee.    Hay and Watson, a firm of Independent Registered Chartered Accountants, was appointed by the shareholders at the last annual meeting to examine the consolidated financial statements and provide the independent professional opinion which follows. Jason S. Weber Dorothy G. Miller  Jason S. Weber, P.Geo Dorothy G. Miller President & Chief Executive Officer Chief Financial Officer  November 24, 2010    Suite 575, 510 Burrard St., Vancouver, BC, Canada V6C 3A8 Tel: 604.669.6660 | Fax: 604.669.0898 | www.kiskametals.com   -90-    [kiskaannual20fa1009.gif]   REPORT OF INDEPENDENT REGISTERED CHARTERED ACCOUNTANTS  To the Shareholders of Kiska Metals Corporation  We have audited the amended and restated consolidated balance sheet of Kiska Metals Corporation (the Company) as at December 31, 2009 and the amended and restated consolidated statements of operations and comprehensive loss, shareholders equity, and cash flows for the year then ended (all expressed in Canadian dollars). These financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on these financial statements based on our audit. We conducted our audit in accordance with Canadian generally accepted auditing standards and the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform an audit to obtain reasonable assurance whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. In our opinion, these amended and restated consolidated financial statements present fairly, in all material respects, the financial position of the Company as at December 31, 2009 and the results of its operations and its cash flows for the year then ended in accordance with Canadian generally accepted accounting principles. Our previous report dated March 29, 2010 on the original consolidated financial statements as at and for the year ended December 31, 2009 has been withdrawn as those  financial statements have been revised for the change in the recording of goodwill on the balance sheet arising from the acquisition of Rimfire Minerals Corporation, the recording of mineral property impairment on the statement of operations and the disclosure of differences between generally accepted accounting principles in Canada and the United States.  For further explanation of the revisions, see Note 3 to the amended and restated consolidated financial statements. Canadian generally accepted accounting principles vary in certain significant respects from accounting principles generally accepted in the United States of America. The effect of the application of United States generally accepted accounting principles on the net loss for each year and the total assets and shareholders equity at the end of each year in these consolidated financial statements is summarized in Note 19 to the amended and restated consolidated financial statements. The consolidated financial statements as at December 31, 2008 and for the years ended December 31, 2008 and 2007 were, except as to Note 19, audited by other auditors who expressed an opinion without reservation on those statements in their reports dated April 17, 2009 and April 23, 2008.  We have audited the information in Note 19 for the years ended December 31, 2008 and 2007 and, in our opinion, such information is presented fairly in all material respects.  Hay & Watson Independent Registered Chartered Accountants Vancouver, Canada March 29, 2010, except as to Notes 1, 3, 15, 18, and 19 which are as of November 18, 2010   -91-    [kiskaannual20fa1011.gif]  Comment by Independent Registered Chartered Accountants on Canada  United States of America Reporting Difference  The standards of the Public Company Oversight Board (United States) for auditors require the addition of an explanatory paragraph (following the opinion paragraph) when the financial statements are affected by conditions and events that cast substantial doubt on the Company's ability to continue as a going concern, such as those described in Note 1 to the financial statements. Our report to the shareholders dated March 29, 2010, except as to Notes 1, 3, 15, 18 and 19 which are as of November 18, 2010, is expressed in accordance with Canadian reporting standards which do not permit a reference to such events and conditions in the report of the independent registered chartered accountants when these are adequately disclosed in the financial statements. Hay & Watson Independent Registered Chartered Accountants Vancouver, Canada March 29, 2010, except as to Notes 1, 3, 15, 18 and 19which are as of November 18, 2010    -92-


Amended and Restated  KISKA METALS CORPORATION Consolidated Statements of Operations and Comprehensive Loss Years Ended December 31 (Expressed in Canadian Dollars)  Mineral Property OperationsNote2009
Restated Note 320082007RevenueOption proceeds$           157,951$                       -$                       -Project management fees115,100897,3151,358,045273,051897,3151,358,045ExpensesAcquisition expenditures330,598158,990198,500Exploration expenditures5,853,5377,205,24811,664,530Exploration tax credits(9,798)--Reclamation obligations13355,829--Impairment loss on mineral properties37,817,78814,347,9547,364,23811,863,030Loss from mineral property operations(14,074,903)(6,466,923)(10,504,985)Other OperationsSalaries and employee benefits680,8281,615,6442,549,385Consulting and outsourced services1,073,104507,815940,586Marketing services164,340--General and administrative473,9061,126,2001,736,104Depreciation and amortization240,496251,303211,426Share-based compensation14(b)424,51676,461761,4823,057,1903,577,4236,198,983Operating loss before the following(17,132,093)(10,044,346)(16,703,968)Financing expense10(a)/11(59,660)(3,565,047)(2,359,900)Interest income26,18324,702381,149Equity loss in investment8(1,176,145)(916,181)(217,161)(Loss) gain on sale of investment6(240,285)(3,760)112,619Impairment loss on investment6(130,000)--Loss on disposal of assets(44,026)--Dilution gain8--1,646,124Gain on repayment of convertible loan11-279,859-Foreign exchange gain (loss)1168,760(3,130,547)1,137,511Loss before income taxes(18,687,266)(17,355,320)(16,003,626)Recovery of income taxes152,7631,094,5791,528,991Net loss(18,684,503)(16,260,741)(14,474,635)Unrealized foreign exchange loss on investment-(7,668)(18,538)Realized loss on sale of investment240,285--Impairment loss on available-for-sale investment130,000--Net change in unrealized gains (losses) on available for sale investment52,167(656,525)455,347Tax effect of changes in other comprehensive income (loss)(2,763)19,807(96,014)Comprehensive loss$   (18,264,814)$    (16,905,127)$   (14,133,840)Basic and diluted net loss per share$              (0.51)$               (1.84)$              (3.73)Basic and diluted weighted average number of shares outstanding during the year36,876,4918,831,9303,859,409


-93-


Amended and Restated   KISKA METALS CORPORATION Consolidated Balance Sheets December 31 (Expressed in Canadian Dollars)  Note2009
Restated Note 32008AssetsCurrent assetsCash and cash equivalents$                 1,071,695$                  762,560Restricted cash5202,70782,228Marketable securities6370,417120,532Amounts receivable51,756258,337Prepaid expenses and deposits152,03869,545Total current assets1,848,6131,293,202Mineral property interests7--Equity investment8-765,747Property, plant and equipment, net9479,282580,811Other assets-5,583Goodwill3--Total Assets$               2,327,895$              2,645,343Liabilities and Shareholders EquityAccounts payable and accrued liabilities$                    241,097$                 416,071Due to related party10(c)11,340225,000Joint venture partner deposits32,314-Current liabilities284,751641,071Reclamation obligations13401,391-Total liabilities686,142641,071Shareholders EquityShare capital14(a)65,659,03850,048,042Contributed surplus14(b,c)5,581,4943,290,195Accumulated other comprehensive income (loss)15,443(404,246)Accumulated deficit(69,614,222)(50,929,719)Total shareholders equity1,641,7532,004,272Total Liabilities and Shareholders Equity$               2,327,895$               2,645,343APPROVED BY THE BOARDDavid A. CaulfieldDirectorJason S. WeberDirector  The accompanying notes are an integral part of these consolidated financial statements


-94-


Amended and Restated  KISKA METALS CORPORATION Consolidated Statements of Cash Flows Years Ended December 31 (Expressed in Canadian Dollars)  2009 
Restated Note 320082007Cash Flows Used for Operating ActivitiesNet loss$    (18,684,503)$    (16,260,741)$ (14,474,635)Add (deduct) items not involving cash:Mineral property option proceeds(99,665)--Mineral property acquisition cost156,500--Reclamation obligation expense355,829--Impairment loss on mineral properties7,817,788Depreciation and amortization240,496251,303211,426Dilution gain--(1,646,124)Equity loss in investment1,176,145916,181217,161Financing expense59,6603,427,5701,157,426Foreign exchange loss(68,760)3,313,734-Future income tax recovery(2,763)(1,063,300)(1,528,991)Gain on settlement of convertible loan facility-(279,859)-Loss (gain) on sale of investments and assets284,3113,760(112,619)Impairment loss on available-for-sale investment130,000--Share-based compensation expense544,87176,461761,482(8,090,091)(9,614,891)(15,414,874)Reclassify interest income(26,183)(24,702)(381,149)Net change in non-cash working capital balances related to operations:Amounts receivable258,499569,905(202,308)Prepaid expenses and deposits166,009552,569(468,133)Accounts payable and accrued liabilities(638,934)(1,042,070)311,898(8,330,700)(9,559,189)(16,154,566)Cash Flows From (Used for) Investing ActivitiesRestricted cash(10,923)2,577,9991,637,581Proceeds from sale of marketable securities90,099-59,879Interest income received52,46624,702381,149Purchase of equity investment(410,398)-(59,403)Purchase of property, plant and equipment(85,168)(523,057)(32,595)(363,924)2,079,6441,986,611Cash Flows From (Used for) Financing ActivitiesProceeds from issuance of shares and warrants5,009,74729,430,6753,503,381Payment of share issue costs(438,496)(172,421)(91,896)Proceeds from sale of assets-20,980-Proceeds from note payable / convertible loan1,750,000-23,319,000Cash acquired on acquisition (Note 1)4,463,269--Repayment of note payable / convertible loan(1,821,712)(23,828,000)(9,000,000)Repayment of capital lease obligations-(18,228)(35,075)8,962,8085,433,00617,695,410Effects of foreign currency translation on cash and cash equivalents40,95183,677(2,531,932)


-95-


Amended and Restated  KISKA METALS CORPORATION Consolidated Statements of Cash Flows Years Ended December 31 (Expressed in Canadian Dollars)   2009 
Restated Note 320082007Increase (Decrease) in Cash and Cash Equivalents309,135(1,962,862)995,523Cash and Cash Equivalents, Beginning of Year762,5602,725,4221,729,899Cash and Cash Equivalents, End of Year$    1,071,695$         762,560$     2,725,422Cash and Cash Equivalents are comprised of:Cash$       571,695$    712,560$    2,725,422Term deposits500,00050,000-$    1,071,695$   762,560$    2,725,422Supplemental InformationIncome taxes paid$              541$         104,463$         54,253Flow-through penalty tax paid84,067--Interest paid74,65934,502206,670Non-cash transactionsMarketable securities received for mineral property interest option proceeds99,665-220,000Shares issued for fees and interest on convertible loan-1,440,336704,764Shares and options issued for the acquisition of Rimfire Minerals Corporation (Note 1)12,786,175--


-96-


Amended and Restated  KISKA METALS CORPORATION Consolidated Statements of Shareholders Equity Years Ended December 31 (Expressed in Canadian Dollars)   Note2009
Restated Note 320082007Share capital14(a)Balance, beginning of year$   50,048,042$     20,342,562$    17,751,886Issued in satisfaction of convertible loan commitment fee and interest11-1,440,335704,764Issued for corporate acquisition112,412,717--Issued for cash in private placement4,950,00029,328,000-Value attributable to warrants issued in private placement(1,267,650)--Issued upon exercise of stock options/warrants59,747102,6753,503,381Transfer from contributed surplus on exercise of stock options46,80070,19117,764Share issue costs(590,618)(1,235,721)(1,635,233)Balance, end of year65,659,03850,048,04220,342,562Equity component of convertible loan11Balance, beginning of year-4,523,973-Equity component of convertible loan-(4,523,973)4,523,973Balance, end of year--4,523,973Contributed surplus14(b,c)Balance, beginning of year3,290,1953,283,9262,540,208Options issued for corporate acquisition1373,458--Share-based compensation544,87276,461761,482Transfer to common shares on exercise of options(46,800)(70,192)(17,764)Value attributable to warrants issued in private placement1,267,650--Value attributable to brokers warrants issued in private placement152,119--Balance, end of year5,581,4943,290,1953,283,926Accumulated DeficitBalance, beginning of year(50,929,719)(37,313,241)(22,838,606)Impact of repayment of convertible loan11-(2,644,263)-Net loss(18,684,503)(16,260,741)(14,474,635)Balance, end of year(69,614,222)(50,929,719)(37,313,241)Accumulated other comprehensive income (loss)Balance, beginning of year(404,246)240,140(100,655)Unrealized foreign exchange loss on available-for-sale investment-(7,668)(18,538)Realized loss on disposal of available-for-sale investments240,285--Impairment loss on available-for-sale-investments130,000--Net change in unrealized gains (losses) on available-for-sale investments52,167(656,525)455,347Tax effect of changes in other comprehensive income (loss)(2,763)19,807(96,014)Balance, end of year15,443(404,246)240,140Total shareholders equity (deficiency)$   1,641,754$    2,004,272$   (8,922,640) The accompanying notes are an integral part of these consolidated financial statements


-97-  KISKA METALS CORPORATION  Notes to the Consolidated Financial Statements December 31, 2009, 2008 and 2007 (Expressed in Canadian Dollars)     1. ORGANIZATION AND OPERATIONS  These consolidated financial statements have been prepared in accordance with accounting principles generally accepted (GAAP) in Canada, which, with respect to the Company, conform in all material respects with accounting principles generally accepted in the United States of America, except as described in Note 19 to the consolidated financial statements.  Operations and Basis of Consolidation Kiska Metals Corporation (formerly Geoinformatics Exploration Inc. or "Geoinformatics) and its wholly-owned subsidiaries (collectively the Company or Kiska) is a global resources company which has developed a unique and innovative approach to mineral exploration. Geoinformatics was incorporated on March 21, 1980 under the laws of the Province of British Columbia. On August 29, 1996, Geoinformatics was continued in the Yukon Territory from the Province of British Columbia. On August 5, 2009, the Company completed the 100% acquisition of Rimfire Minerals Corporation (Rimfire), and changed its name to Kiska Metals Corporation. As a result of the acquisition, the consolidated statements of operations and comprehensive loss and cash flows for the year ended December 31, 2009 includes the results of operations and cash flows of Geoinformatics until August 5 and the combined entity from August 6 to December 31, 2009. The comparative consolidated annual statements of operations and comprehensive loss and cash flows for the years ended December 31, 2008 and 2007 include only the results of operations and cash flows of Geoinformatics in accordance with generally accepted accounting principles for business combinations.  The Company acquired 100% of Rimfire by issuing 22,365,258 common shares and issuing 1,905,300 options to purchase common shares, for an aggregate fair value of $12,786,175. The fair value of the common shares, amounting to $12,412,717, was based on the bid price of the common shares on the date of acquisition, and the fair value of the options issued, amounting to $373,458, was determined using the Black-Scholes option pricing model using the following weighted average assumptions: volatility of 89%, risk free interest rate of 1.8%, an expected life of 2.7 years, and a dividend yield of 0%.  The Company accounted for this transaction using the acquisition method. The fair value of the net assets acquired was:  Cash and cash equivalents$     4,463,269Amounts receivable51,918Marketable securities162,630Prepaid expenses and deposits358,058Property, plant and equipment104,188Mineral property interests (restated  Note 3)7,974,288Future income tax assets-Goodwill-Accounts payable and accrued liabilities(282,614)Reclamation obligations(45,562)Consideration paid$   12,786,175  -98-  KISKA METALS CORPORATION  Notes to the Consolidated Financial Statements December 31, 2009, 2008 and 2007 (Expressed in Canadian Dollars)     1. ORGANIZATION AND OPERATIONS (continued)  The fair value of the amounts receivable are equivalent to the gross contractual amounts receivable. Acquisition costs of $633,875 were expensed and included in consulting and outsourced services ($592,743), general and administrative ($39,864) and marketing services ($1,268) in the Consolidated Statement of Operations for the year ended December 31, 2009. Acquisition costs of $18,000 were included in the current years share issue costs.  Total revenues of $60,644 and the net loss of $1,578,442 of Rimfire have been included in the consolidated statement of operations and comprehensive loss since the date of acquisition.  Had the acquisition of Rimfire occurred at the beginning of the year, the revenue of the combined entity would have been $301,241 (2008 - $1,146,902) with a net loss of $19,636,744 (2008 - $19,234,879).  The Company is in the development stage as defined by the Canadian Institute of Chartered Accountants (CICA) Accounting Guideline 11 - Enterprises in the Development Stage and it is in the process of exploring its mineral properties. As such, the Company has not yet determined whether these properties contain reserves that are economically recoverable. Due to the nature of mineral exploration and the Companys business strategy, the Company expenses all acquisition and exploration expenditures as incurred until such time as the Company does establish that the property contains such reserves, at which time ongoing exploration and development expenditures will be capitalized. The acquisition of Rimfire resulted in an allocation of $7,974,288 to the fair value of the acquisition costs of the mineral property interests. Subsequent to the acquisition, a re-evaluation of the fair value of the mineral property interests was conducted, and an impairment loss of $7,817,788 was recognized as at September 30, 2009 to reduce the carrying value of the properties acquired to their estimated fair values (Note 3).  The business of mining and exploring for minerals involves a high degree of risk and there can be no assurance that current exploration programs will result in profitable mining operations. Some of the Companys mineral property interests are located outside of Canada and are subject to the risks associated with foreign investment, including increases in taxes and royalties, renegotiations of contracts, currency exchange fluctuations and political uncertainty. Although the Company has taken steps to verify title to the properties on which it is conducting exploration and in which it has an interest, these procedures do not guarantee the Companys title. Property title may be subject to unregistered prior agreements and non-compliance with regulatory requirements.   -99-  KISKA METALS CORPORATION  Notes to the Consolidated Financial Statements December 31, 2009, 2008 and 2007 (Expressed in Canadian Dollars)     1. ORGANIZATION AND OPERATIONS (continued)  The Companys subsidiaries and their respective jurisdictions consist of the following:


|                                             |                                    |             |             
|-------------------------------------------- | ---------------------------------- | ----------- | ------------
|                                             | Year of incorporation/
acquisition | % Ownership | Jurisdiction
|Geoinformatics Exploration Australia Pty Ltd | 2002                               | 100%        | Australia   
|Rimfire Australia Pty Ltd.                   | 2009                               | 100%        | Australia   
|2012860 Ontario Limited                      | 2002                               | 100%        | Canada      
|Geoinformatics Exploration Canada Limited    | 2005                               | 100%        | Canada      
|Rimfire Minerals Corporation                 | 2009                               | 100%        | Canada      
|Geoinformatics Explorations Ireland Limited  | 2002                               | 100%        | Ireland     
|Minera Geoinformatica S.A de C.V.            | 2004                               | 100%        | Mexico      
|Geoinformatics Alaska Exploration, Inc.      | 2003                               | 100%        | USA         
|GXL USA, Inc.                                | 2007                               | 100%        | USA         
|Rimfire Alaska, Ltd.                         | 2009                               | 100%        | USA         
|Rimfire Nevada Ltd.                          | 2009                               | 100%        | USA         

Going Concern  These consolidated financial statements have been prepared on the basis that the Company is a going concern, which contemplates the realization of its assets and the settlement of its liabilities in the normal course of operations. However, the Company has no significant source of revenue and has experienced recurring losses. The Companys ability to continue as a going concern is dependent on the Companys ability to obtain additional debt or equity financing to successfully advance the exploration and development of mineral property interests in its exploration portfolio and to be able to derive material proceeds from the sale or divesture of those properties and/or other assets such as royalty rights and equity interests (see Note 20 Subsequent Events). These consolidated financial statements do not include any adjustments to the amounts and classification of assets and liabilities that may be necessary should the Company be unable to continue as a going concern. Such adjustments and classifications could be material.  -100-  KISKA METALS CORPORATION  Notes to the Consolidated Financial Statements December 31, 2009, 2008 and 2007 (Expressed in Canadian Dollars)     2. SIGNIFICANT ACCOUNTING POLICIES  These consolidated financial statements reflect the following other significant accounting policies:  Foreign Currency Translation The functional currency of the Company is the Canadian dollar. The Company and its subsidiaries operate in Canada, the United States, Mexico, and Australia.  The Companys subsidiaries are considered integrated foreign operations. Monetary assets and liabilities denominated in foreign currencies are translated into Canadian dollars at exchange rates prevailing at the balance sheet date, and non-monetary assets and liabilities are translated at exchange rates prevailing at the transaction date. Revenue and expense items are translated at exchange rates prevailing at the time of the transaction. Foreign exchange gains and losses are included in operations.  Use of Estimates The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions about future events that affect the reported amount of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amount of revenues and expenses during the reporting periods. Actual results could differ from these estimates.  Significant estimates used in these financial statements include, amongst others, estimates of reclamation expense, the recoverability of amounts receivable, the calculation of stock based compensation, the fair value of marketable securities and warrants issued, and the recoverability of property, plant and equipment, goodwill and future income tax assets.  Cash and Cash Equivalents Cash and cash equivalents includes cash and highly-liquid term deposits that are readily convertible to known amounts of cash.  Restricted cash Restricted cash consists of term deposits in favour of regulatory authorities held as site restoration deposits or performance bonds for mineral properties (see Note 5).  Marketable securities Marketable securities consist of investments in common shares of publicly listed companies that are designated as available-for-sale. Unrealized gains and losses related to available-for-sale investments are excluded from operations and are included in Accumulated Other Comprehensive Income (Loss) until such gains and losses are realized or an other-than-temporary decline in value is determined to have occurred.    -101-  KISKA METALS CORPORATION  Notes to the Consolidated Financial Statements December 31, 2009, 2008 and 2007 (Expressed in Canadian Dollars)    2. SIGNIFICANT ACCOUNTING POLICIES (continued)   Equity investments Investments in shares of incorporated companies in which the Company has significant influence are accounted for using the equity method. Significant influence is the ability to influence the strategic operating, investing and financing policies of the investee, but where control does not exist.  Under the equity method, investments are carried at cost as adjusted for the Companys proportionate share of the earnings or losses of the investee, less any loss in value of the investment that is other than temporary.  Financial Assets and Financial Liabilities The Companys financial assets, other than cash and cash equivalents (including restricted cash), and financial liabilities are classified as follows: · Amounts receivable are classified as loans and receivables. They are measured at amortized cost. At December 31, 2009 and 2008, the recorded amounts approximate fair value. · Marketable securities are classified as available for sale. Available for sale assets and liabilities are measured at fair value with unrealized gains and losses recorded in other comprehensive income (loss) until the instrument is either sold or suffers an impairment that is other than temporary. · Accounts payable, due to related party, and joint venture partner deposits are classified as other financial liabilities and are measured at amortized cost. At December 31, 2009 and 2008, the recorded amounts approximate fair value.  Transaction costs directly attributable to the acquisition or issue of a financial asset or financial liability are added to the carrying amount of the financial asset or financial liability, and are amortized to operations using the effective interest rate method.  Mineral Property Interests The Companys mineral property interests are composed of mineral properties owned by the Company and rights to ownership of mineral properties which the Company can earn through cash or share payments, incurring exploration expenditures and combinations thereof. The Companys property ownership and rights to property ownership are described in Note 7.   -102-  KISKA METALS CORPORATION  Notes to the Consolidated Financial Statements December 31, 2009, 2008 and 2007 (Expressed in Canadian Dollars)    2. SIGNIFICANT ACCOUNTING POLICIES (continued)   Mineral Property Interests (continued) The Company accounts for its mineral property interests whereby all acquisition and exploration costs are charged to operations as incurred, and all property sales and option proceeds received are credited to operations. The Company expenses the acquisition costs as there are currently no identifiable mineral reserves on its property interests and, therefore, there is no basis on which to estimate future cash flows for purposes of assessing the recoverability of those costs. When the existence of a mineral reserve on a property has been established, future acquisition, exploration and development costs will be capitalized for that property. After commercial production on a property commences, the net capitalized costs will be charged to future operations using the unit of production method based on estimated recoverable reserves on the property.  Property, Plant and Equipment Property plant and equipment are recorded at cost, and sub-divided into component parts where applicable based on their estimated useful lives. Depreciation is provided at annual rates considered sufficient to amortize the cost of the assets over their estimated useful lives as follows: Appliances3 yearsCamp structures3 yearsComputer software2 yearsComputer equipment3.5 yearsField equipment5 yearsLeasehold improvementsTerm of leaseMobile equipment2.5 yearsNiton Analyzer3.5 yearsOffice equipment and furniture8 years  The Company reviews the carrying values of its property, plant and equipment whenever events or changes in circumstances indicate that their carrying values may exceed their estimated net recoverable amounts determined by reference to estimated future operating results and undiscounted net cash flows. An impairment loss is recognized when the carrying value of those assets is not recoverable and exceeds their fair value.   -103-  KISKA METALS CORPORATION  Notes to the Consolidated Financial Statements December 31, 2009, 2008 and 2007 (Expressed in Canadian Dollars)    2. SIGNIFICANT ACCOUNTING POLICIES (continued)   Mineral Property Reclamation Obligations The Company recognizes the fair value of a liability for a reclamation obligation on mineral property interests when the obligation is incurred and the fair value can be reasonably estimated. The fair value of the obligation is based on the estimated cash flow required to settle the obligation, discounted using the prime lending rate of the Companys primary financial institution adjusted for the Companys credit rating. The fair value of the obligation is recorded as a liability and charged to mineral property expenses. The liability is adjusted for accretion expense representing the increase in the fair value of the obligation due to the passage of time. Changes resulting from revisions to the timing or the amount of the original estimate of undiscounted cash-flows are recognized as an increase or a decrease to the carrying amount of the liability and charged to mineral property expenses. When the existence of a mineral reserve on a property has been established, future reclamation obligation costs will be capitalized to that property.  Flow-Through Shares In prior years the Company financed a portion of its exploration activities through the issuance of flow-through shares pursuant to which the Company renounced the right to claim the exploration expenditures for tax purposes in an amount equal to the gross proceeds of the flow-through share issue, and the tax deductibility of the exploration expenditures was effectively transferred to the investors.  Proceeds received from such issuance have been credited to share capital and the related exploration expenditures are expensed as incurred. The Company records the related future income tax liability as a cost of issuing the flow-through shares to the investors when the flow-through share expenditures are renounced. When the Company has loss carry-forwards and/or deductible temporary differences that it has not recognized in previous years, the Company reverses the valuation allowance against that portion of its unrecognized future tax assets as a recovery of income taxes in the consolidated statements of operations.   -104-  KISKA METALS CORPORATION  Notes to the Consolidated Financial Statements December 31, 2009, 2008 and 2007 (Expressed in Canadian Dollars)    2. SIGNIFICANT ACCOUNTING POLICIES (continued)   Revenue recognition Revenue is recognized as services are performed and client-reimbursable expenses are incurred in respect of each project. Services performed can take the form of project management and execution or other management services. Option payments are recognized when they become due, pursuant to binding agreements with exploration joint venture partners. In addition to these revenues earned, the Company may become entitled to future revenue streams, under contracts with these partners deriving from:  · net smelter royalties once mining production has commenced or the sale of the rights to these royalties; · free-carried or joint venture interests in projects that become producing mines or the sale of such free-carried or joint venture interests; and · direct equity interests in mining operations or operating companies or the sale of such interests in mineral properties or share interests in operating companies.  Revenue is not recognized in respect of these future potential revenue streams until earned and the Company can reasonably estimate the related amounts.  Exploration Tax Credits The Company may receive refundable exploration tax credits and grants from provincial jurisdictions in Canada equal to a specified rate of qualifying exploration expenditures incurred on mineral property interests located within that jurisdiction. The Company records these exploration tax credits or grants as it incurs the related exploration expenditures.  Share-Based Compensation The Company issues options to purchase shares under the terms of an incentive plan described in Note 13. When options to purchase shares are issued to employees, officers or directors, the fair value of the options on the date of the grant is recognized as compensation expense, with a corresponding increase in contributed surplus, over the period during which the related options vest. The proportion of the share-based compensation attributable to employee activity on each mineral property is charged to exploration expense. When options to purchase shares are issued to non-employees in return for goods and services, the fair value of the options issued is recognized as an expense, with a corresponding increase in contributed surplus, in the period in which the goods or services are received or are expected to be received.  The consideration received on the exercise of share options is credited to share capital. When options are exercised, previously recorded compensation expense is reclassified from contributed surplus to share capital to fully reflect the consideration for the shares issued.   -105-  KISKA METALS CORPORATION  Notes to the Consolidated Financial Statements December 31, 2009, 2008 and 2007 (Expressed in Canadian Dollars)    2. SIGNIFICANT ACCOUNTING POLICIES (continued)   Income Taxes The Company follows the asset and liability method of accounting for income taxes. Under this method, future income tax assets and liabilities are recorded based on temporary differences between the carrying amount of balance sheet items and their corresponding tax bases. In addition, the future tax benefits of unused tax losses and other deductions carried forward are recognized, subject to a valuation allowance, to the extent that it is more likely than not that such future benefits will ultimately be realized. Future income tax assets and liabilities are measured using enacted or substantively enacted tax rates and laws expected to apply when the tax liabilities or assets are to be either settled or realized.  Loss per Share The basic loss per share is computed by dividing the net loss by the weighted average number of common shares outstanding during the year. The diluted loss per share reflects the potential dilution of common share equivalents, such as the outstanding share purchase options and warrants, in the weighted average number of common shares outstanding during the year, if dilutive. For this purpose, the treasury stock method is used for the assumed proceeds upon the exercise of share purchase options and warrants that are used to purchase common shares at the average market price during the year. Common share equivalents (Note 14) have been excluded from the computation of the diluted loss per share for the periods presented as including them would have been anti-dilutive. All comparative figures have been reclassified to reflect the changes in the number of common shares outstanding due to share consolidations.  Comprehensive Income (Loss) Comprehensive income (loss) comprises the Companys net income (loss) and other comprehensive income (loss). Other comprehensive income (loss) represents changes in shareholders equity during a period arising from non-owner sources and, for the Company, principally includes unrealized gains and losses on available for sale financial assets, net of income taxes. The Companys comprehensive income (loss), components of other comprehensive income (loss), and accumulated other comprehensive income (loss) are presented in the Consolidated Statements of Operations and Comprehensive Loss and the Consolidated Statements of Shareholders Equity.   -106-  KISKA METALS CORPORATION  Notes to the Consolidated Financial Statements December 31, 2009, 2008 and 2007 (Expressed in Canadian Dollars)       3. RESTATEMENT  Background  The Company acquired all the outstanding shares of Rimfire Minerals Corporation (Rimfire) on August 5, 2009, for the purpose of obtaining:  · sufficient cash to continue and materially advance the exploration of the Whistler Project in Alaska owned by the Company. · an enhanced precious metals portfolio of properties located in stable, mining-friendly jurisdictions; Alaska, Nevada, British Columbia, Yukon, and Australia. · a strong post-acquisition board of directors who have expertise in capital markets and project advancement, and an enhanced management team which is skilled in leveraging the potential of exploration properties through strong project management and strategic partnerships.  At the time of the acquisition, the Company accounted for this transaction as the purchase of assets, allocating the fair value of the consideration (trading shares of the Company) to the assets acquired. When preparing the information circular relating to the acquisition of Rimfire, the Company described the allocation of the estimated fair value of the consideration to the acquired assets of Rimfire as:  Net assets acquired:Cash and cash equivalents$              5,345,582Restricted cash108,406Accounts receivable128,691Marketable securities139,968Prepaid expenses44,937Lease deposits21,234Property and equipment22,600Mineral properties7,146,311Accounts payable and accrued liabilities(518,831)Mineral property reclamation obligations(47,552)Consideration paid$            12,391,346  This allocation was subsequently revised to include the updated information available to the Company at the conclusion of the acquisition. The revised figures were also disclosed in the interim financial statements for the nine months ended September 30, 2009.  Following the completion of the acquisition, the changes planned in the composition of the board of directors and the transfer of the management of the Company to the former management of Rimfire were completed.  -107-  KISKA METALS CORPORATION  Notes to the Consolidated Financial Statements December 31, 2009, 2008 and 2007 (Expressed in Canadian Dollars)     3. RESTATEMENT (continued)  Background (continued)  The new board and management team conducted a detailed review of the Companys properties and operations, and concluded that, considering the market conditions for obtaining additional funding at the time of the detailed review and the short and long-term potential of its portfolio of mineral properties, it was prudent to devote the majority of the Companys existing resources to the development of the Whistler Project.  Based on this evaluation, the new management revised the fair value of the mineral properties acquired, based on expected minimal future expenditures on these properties, to $156,500. The new management consequently reallocated the balance of the acquisition fair value of $7,817,788 previously allocated to the mineral properties, to Goodwill, representing the estimated fair value of a strong post-acquisition board of directors who have expertise in capital markets and project advancement and an enhanced management team which is skilled in leveraging the potential of exploration properties through strong project management and strategic partnerships.  These revised estimated fair values were used in the preparation of the Companys amended consolidated financial statements for the nine months ended September 30, 2009 (as amended and filed May 25, 2010) and the year ended December 31, 2009 (filed on April 26, 2010), and the assets acquired were reported therein as:  Cash and cash equivalents$     4,463,269Amounts receivable51,918Marketable securities162,630Prepaid expenses and deposits358,058Property, plant and equipment104,188Mineral property interests156,500Future income tax assets-Goodwill7,817,788Accounts payable and accrued liabilities(282,614)Reclamation obligations(45,562)Consideration paid$   12,786,175  Restatement  Based on further analysis and review conducted after April 26, 2010, the Company has concluded that that the characterization of $7,817,788 as goodwill was inappropriate under Canadian GAAP. The Company has determined that the appropriate method of accounting for the events which occurred after the completion of the acquisition transaction, including the change in the board and management, and the detailed review of the Companys properties and operations, is on a prospective basis.  -108-  KISKA METALS CORPORATION  Notes to the Consolidated Financial Statements December 31, 2009, 2008 and 2007 (Expressed in Canadian Dollars)     3. RESTATEMENT (continued)  These consolidated financial statements have therefore been restated to present the $7,817,788, which was previously presented as Goodwill, as a cost of the acquired mineral property interests of Rimfire consistent with the allocation previously disclosed in the Companys information circular prepared in connection with the acquisition. In addition, a subsequent impairment loss of $7,817,788 was recognized on re-evaluation of the fair value of the mineral property interests acquired and was charged to operations. In accordance with the Companys accounting policy for mineral properties, the other acquisition costs were then expensed in the period in which they were incurred. The previously reported amounts in the consolidated financial statements for the year ended December 31, 2009 have therefore been changed to:  Previously ReportedChangesRestatedConsolidated Statement of Operations and Comprehensive LossImpairment loss recognized on mineral properties$                  -7,817,788$   7,817,788Net loss(10,866,715)(7,817,788)(18,684,503)Comprehensive loss(10,447,026)(7,817,788)(18,264,814)Basic and diluted net loss per share(0.29)(0.22)(0.51)Consolidated Balance SheetGoodwill$      7,817,788$  (7,817,788)$                     -Accumulated deficit(61,796,434)(7,817,788)(69,614,222)Consolidated Statement of Cash FlowsNet loss$  (10,866,715)$  (7,817,788)$ (18,684,503)Impairment loss on mineral properties-7,817,7887,817,788Consolidated Statement of Shareholders EquityNet loss$  (10,866,715)$  (7,817,788)$ (18,684,503)Accumulated deficit, end of year(61,796,434)(7,817,788)(69,614,222)  4. NEW ACCOUNTING STANDARDS  Current Accounting Changes  Section 3064  Goodwill and Intangible Assets The Canadian Institute of Chartered Accountants (CICA) has issued Handbook Section 3064, Goodwill and Intangible Assets, which replaced Section 3062, Goodwill and Intangible Assets. The new standard is applicable for interim and annual financial statements relating to fiscal years beginning on or after October 1, 2008. Section 3064 establishes revised standards for the recognition, measurement, presentation and disclosure of goodwill subsequent to its initial recognition, and of intangible assets. Section 3064 also provides guidance for the treatment of preproduction and start-up costs and generally requires that these costs be expensed as incurred. The Company adopted Section 3064 as of January 1, 2009, and its adoption had no impact on the Companys consolidated financial statements.  -109-  KISKA METALS CORPORATION  Notes to the Consolidated Financial Statements December 31, 2009, 2008 and 2007 (Expressed in Canadian Dollars)     4. NEW ACCOUNTING STANDARDS (continued)  Current Accounting Changes (continued)  Business Combinations  Section 1582 In January 2009, the CICA issued Handbook Section 1582, Business Combinations, which will provide the Canadian equivalent to International Financial Reporting Standards (IFRS) 3, Business Combinations and replace the existing Handbook Section 1581, Business Combinations. The new standard will apply prospectively to business combinations for which the acquisition date is on or after January 1, 2011. Earlier adoption is permitted as of the beginning of a fiscal year, in which case an entity would also be required to early adopt Handbook Section 1601, Consolidated Financial Statements and Handbook Section 1602, Non-controlling Interests. The Company adopted these sections as of January 1, 2009, and accounted for its acquisition of Rimfire in accordance with Section 1582 (Note 1).  Consolidated Financial Statements  Section 1601 In January 2009, the CICA also issued Handbook Section 1601, Consolidated Financial Statements, which establishes standards for the preparation of consolidated financial statements and, along with Section 1602, will replace the existing Handbook Section 1600, Consolidated Financial Statements. The new standard is effective for interim and annual financial statements relating to fiscal years beginning on or after January 1, 2011. Earlier adoption is permitted as of the beginning of a fiscal year, in which case an entity would also be required to early adopt Handbook Section 1582, Business Combinations and Handbook Section 1602, Non-Controlling Interests.  The Company adopted these sections as of January 1, 2009, and the adoption of Section 1601 had no impact on the Companys consolidated financial statements.  Non-Controlling Interests  Section 1602 In January 2009, the CICA also issued Handbook Section 1602, Non-Controlling Interests, which establishes standards for accounting for a non-controlling interest in a subsidiary in consolidated financial statements subsequent to a business combination. It is equivalent to the corresponding provisions of International Accounting Standard IAS 27, Consolidated and Separate Financial Statements. The new standard is effective for interim and annual financial statements relating to fiscal years beginning on or after January 1, 2011. Earlier adoption is permitted as of the beginning of a fiscal year, in which case an entity would also be required to early adopt Handbook Section 1582, Business Combinations and Handbook Section 1601, Consolidated Financial Statements. The Company adopted these sections as of January 1, 2009, and the adoption of Section 1602 had no impact on the Companys consolidated financial statements.   -110-  KISKA METALS CORPORATION  Notes to the Consolidated Financial Statements December 31, 2009, 2008 and 2007 (Expressed in Canadian Dollars)     4. NEW ACCOUNTING STANDARDS (continued)  Current Accounting Changes (continued)  Credit Risk and Fair Value of Financial Assets and Financial Liabilities  EIC 173 In January 2009, the Emerging Issues Committee (EIC) of the CICA issued Emerging Issues Committee Abstract 173, Credit Risk and the Fair Value of Financial Assets and Financial Liabilitieswhich provides guidance on the implications of credit risk in determining the fair value of an entitys financial assets and financial liabilities. The guidance clarifies that an entitys own credit risk and the credit risk of counterparties should be taken into account in determining the fair value of financial assets and financial liabilities, including derivative instruments, for presentation and disclosure purposes.  The Companys fair value disclosures incorporate this new guidance.  Accounting Changes  Section 1506 In June 2009, the CICA amended Handbook Section 1506 Accounting Changes. The amendment excludes changes in accounting policies upon the complete replacement of an entitys primary basis of accounting, as will occur when an entity adopts IFRSs for the first time, from the scope of Section 1506.  Financial Instruments - Disclosures  Section 3862 In June 2009, the CICA also amended Handbook Section 3862, Financial Instruments  Disclosures to provide the Canadian equivalent to amendments made to IFRS 7, Financial Instruments: Disclosures. The amendments require enhanced disclosure requirements, which include:  · classifying and disclosing fair value measurements based on a three-level hierarchy · Level 1  inputs are unadjusted quoted prices in active markets for identical assets or liabilities; · Level 2  inputs other than quoted prices in Level 1 that are observable for the asset or liability, either directly or indirectly; and · Level 3  inputs for the asset or liability that are not based on observable market data. · reconciling beginning balances to ending balances for Level 3 measurements · identifying and explaining movements between levels of the fair value hierarchy · providing a maturity analysis for derivative financial liabilities based on how the entity manages liquidity risk, and · disclosing the remaining expected maturities of non-derivative financial liabilities if liquidity risk is man­aged on that basis.  These amendments are applicable to financial statements for fiscal years ending after September 30, 2009 and comparative information is not required in the year these amendments are first implemented. Applicable disclosures have been included in Note 6 to the consolidated financial statements.   -111-  KISKA METALS CORPORATION  Notes to the Consolidated Financial Statements December 31, 2009, 2008 and 2007 (Expressed in Canadian Dollars)     4. NEW ACCOUNTING STANDARDS (continued)  Current Accounting Changes (continued)  Equity  Section 3251 In August 2009, the CICA issued amendments to Handbook Section 3251, Equity as a consequence of issuing Section 1602, Non-controlling Interests. The amendments require non-controlling interests to be recognized as a separate component of equity.  The new standard is effective for interim and annual financial statements relating to fiscal years beginning on or after January 1, 2011. Earlier adoption is permitted as of the beginning of a fiscal year, in which case an entity would also be required to early adopt Handbook Section 1602, Non-Controlling Interests. The Company adopted these sections as of January 1, 2009, and their adoption had no impact on the Companys consolidated financial statements.  Financial Instruments  Recognition and Measurement  Section 3855 In August 2009, the CICA also amended Handbook Section 3855, Financial Instruments  Recognition and Measurement, bringing greater consistency between Canadian GAAP, IFRSs and US GAAP on the timing of impairment recognition for debt instruments. Companies that have classified financial assets as held-to-maturity investments are now required to assess those financial assets using the impairment requirements of Handbook Section 3025, Impaired Loans. Section 3025 was consequentially amended to accommodate the changes to Section 3855. The amendments allow more debt instruments to be classified as loans and receivables. This allows those instruments to be evaluated for impairment using Section 3025. In addition, the amendments require reversal of previously recognized impairment losses on available-for-sale financial assets in specified circumstances and require that loans and receivables that an entity intends to sell immediately or in the near term be classified as held for trading.  These amendments did not affect the recognition or measurement of the Companys financial instruments.  Future Accounting Changes  Convergence with International Financial Reporting Standards In 2006, the Accounting Standards Board of the CICA ratified a strategic plan that will result in Canadian GAAP, as used by public companies, evolving and being converged with International Financial Reporting Standards over a transitional period currently expected to be completed by 2011. The International Accounting Standards Board currently has projects underway that should result in new pronouncements which will be included in the convergence process.  The Company is in the process of completing a detailed assessment of the requirements of the transition to IFRS, with the intention of identifying: (i) the timing of the implementation of the transition, (ii) major differences from existing accounting policies (iii) new accounting policies which are appropriate for the Company, (iv) the appropriate disclosures in financial statements prepared under IFRS and (v) developing an implementation plan.  -112-  KISKA METALS CORPORATION  Notes to the Consolidated Financial Statements December 31, 2009, 2008 and 2007 (Expressed in Canadian Dollars)     4. NEW ACCOUNTING STANDARDS (continued)  Future Accounting Changes (continued)  Comprehensive Revaluation of Assets and Liabilities  Section 1625 In August 2009, the CICA also amended Handbook Section 1625, Comprehensive Revaluation of Assets and Liabilities for consistency with new Handbook Section 1582, Business Combinations. The amendments require that, when push-down accounting is used following the acquisition of an enterprise, the assets and liabilities are to be measured at the values used in accounting for the purchase transaction or transactions in accordance with Section 1582. The amendments also require that, when a future income tax asset that arose prior to the date of a comprehensive revaluation and that was not recognized in the comprehensive revaluation is subsequently recognized; the benefit should be recognized in accordance with Section 1582 and Handbook Section 3465, Income Taxes.  The amendments apply prospectively to comprehensive revaluations of assets and liabilities occurring in fiscal years beginning on or after January 1, 2011. Early adoption is permitted as of the beginning of a fiscal year. An entity adopting this Section for a fiscal year beginning before January 1, 2011 would also be required to adopt Section 1582.   5. RESTRICTED CASH  Restricted cash of $202,707 (2008 - $82,228) represents project reclamation deposits in favour of regulatory authorities held as site restoration deposits. The amount of the deposit is determined at the time the exploration program is planned and a notice of work is submitted to the regulatory authority. If the work is more extensive than previously planned, the amount of the deposit will be increased. When reclamation work is completed on a project, the deposit is released to the Company.    -113-  KISKA METALS CORPORATION  Notes to the Consolidated Financial Statements December 31, 2009, 2008 and 2007 (Expressed in Canadian Dollars)     6. MARKETABLE SECURITIES  The following table summarizes the components of available-for-sale financial instruments reported as marketable securities at December 31:  Number of SharesCost2009 
Fair Value2008
Fair ValueAfrican Consolidated Resources plc-$                -$              -$    80,532Arcus Development Group Inc.150,00021,00017,250-Capstone Mining Corporation8,70726,73024,467-Island Arc Exploration Corporation200,00018,00021,000-It's Your Nickel Exploration200,000---Laurion Minerals Exploration Inc.2,000,00090,00090,00040,000Millrock Resources Inc.250,00057,50050,000-Plutonic Power Corporation30,00096,90095,700-Silver Quest Resources Ltd.180,00042,08072,000-Balance$   352,210$  370,417$  120,532  African Consolidated Resources shares were sold during the year for gross proceeds of $90,099, on which the Company realized a loss of $240,285. The Company has also recorded an impairment loss in the statement of operations of $130,000 on the Laurion Minerals Exploration Inc. shares as subsequent to the year end they were sold at a loss for gross proceeds of $90,000.  The following table summarizes the classification of the Companys marketable securities within the fair value hierarchy at December 31, 2009:  Quoted prices in active markets for identical assets (Level 1)Significant other observable inputs (Level 2)Significant unobservable inputs (Level 3)TotalPublic securities$  370,417$                -$               -$     370,417Private security----$  370,417$                -$               -$     370,417  There were no transfers between levels of the fair value hierarchy during the year.   -114-  KISKA METALS CORPORATION  Notes to the Consolidated Financial Statements December 31, 2009, 2008 and 2007 (Expressed in Canadian Dollars)     6. MARKETABLE SECURITIES (continued)  The aggregate fair value of investments with unrealized losses and the aggregate amount of the unrealized losses are:  Unrealized Loss Position for Less than 12 monthsFair ValueUnrealized LossesPublic securities$    187,417$   (14,713)  There are four investment positions in an unrealized loss position, all of which are publicly traded securities. These investments have been in an unrealized loss position for less than 12 months, and the temporary impairment has been determined to be due to current market conditions and therefore is included in other comprehensive loss  . 7. MINERAL PROPERTY INTERESTS  Some of the property commitments listed below were assumed at the time of the acquisition of Rimfire and relate to prior property option or purchase agreements.  The Companys commitments to earn or acquire its mineral property interests and commitments by exploration joint venture partners to option mineral property interests from the Company are included in the Companys Annual Information Form which is filed with regulatory authorities along with these financial statements. Summaries of each property agreement are included below.  British Columbia  Gillis Property The Company signed an option agreement to earn a 100% interest in the Gillis property, subject to a 2% Net Smelter Return (NSR), 1.5% of which can be purchased for $1.5 million. The Company is required to complete aggregate exploration expenditures of $300,000, make cash payments of 2.5% of mineral exploration expenditures and other cash payments totaling $165,000 on or before September 5, 2012 and issue 217,500 common shares within 10 days of announcing a National Instrument 43-101 compliant gold resource of at least 435,000 ounces.   -115-  KISKA METALS CORPORATION  Notes to the Consolidated Financial Statements December 31, 2009, 2008 and 2007 (Expressed in Canadian Dollars)    7. MINERAL PROPERTY INTERESTS (continued)   RDN Property The Company acquired a 100% interest in the RDN mineral claims, subject to a 1.34% NSR. The Company may purchase one-half of the NSR for $666,666. The Company signed an option agreement with Northgate Minerals Corporation (Northgate) which provides that Northgate can earn a 51% interest in the RDN Property on completion of aggregate exploration expenditures of $5,000,000 and cash payments of $200,000. The Company is the project operator until Northgate has earned its 51% interest. Northgate may earn an additional 9% interest by completing a feasibility study and funding all expenditures up to completion of the feasibility study. This agreement was amended to suspend the terms of the option agreement until such time as road access to the RDN property is constructed.  The Company (40%) and Northgate (60%) purchased 100% of the LL property, which is contiguous with the RDN property, for $30,000 cash, subject to an NSR of 2%. This royalty can be purchased at any time for $2,000,000.  Redton Project Under the terms of an option agreement, the Company has an option to fund $4.75 million in exploration expenditures to earn an 85% interest in the Alkali Gold Project (Redton) located in British Columbia, with such expenditures to be incurred over the five-year period ending June 3, 2010. As at December 31, 2008, the Company had incurred in excess of $4.75 million in exploration expenditures and earned its 85% interest in Redton. Redton Resources Inc. holds the other 15% interest.  Thorn Property The Company holds a 100% interest in the Thorn mineral property, subject to a 3.5% NSR. The Company can purchase 2% of the NSR for $3,000,000. The Company is required to issue an additional 174,000 shares upon commencement of commercial production from the property. Cangold Limited (Cangold) subsequently earned a 51% interest in the Thorn property. The Company signed a purchase agreement to acquire Cangolds interest in the property by making a cash payment of $100,000 and issuing 100,000 shares. In the event a third party partner becomes involved in the exploration and development of the property, the Company will pay Cangold 25% of any cash or share payments received from the third party partner.  Tide Property The Company purchased the Tide mineral property from Newmont Canada Limited subject to a 1.5% NSR in the event the property becomes commercially feasible to mine. American Creek Resources Ltd. (American Creek) has earned a 51% interest in the property subject to a 1% NSR upon their interest in favour of Serengeti Resources Inc. The Company signed a letter of agreement with American Creek for a second option whereby American Creek can earn an additional 9% interest by funding a further $3.5 million in exploration on or before December 31, 2010; an additional 5% interest by funding a bankable feasibility study, and, at the Companys election, another 5% interest (for a total of 70%) by providing 100% of the initial project development financing.  -116-  KISKA METALS CORPORATION  Notes to the Consolidated Financial Statements December 31, 2009, 2008 and 2007 (Expressed in Canadian Dollars)    7. MINERAL PROPERTY INTERESTS (continued)   Williams Property The Company acquired a 100% interest in the Williams property, subject to a 1.25% NSR. The Company is required to issue an additional 43,500 common shares upon commencement of commercial production from the property. The Company can purchase 0.75% of the NSR for $1,000,000. Advance royalty payments of $5,000 per year are payable to the underlying vendor.  Yukon  Boulevard Property (Northgate Alliance) The Boulevard Property was staked on behalf of an alliance with Northgate Minerals, who earned a 60% interest in the property. The Company signed an option agreement with Silver Quest Resources Ltd. (Silver Quest) whereby Silver Quest can acquire the Companys 40% interest in the property by making staged cash payments totaling $80,000, issuing an aggregate of 400,000 shares and completing exploration expenditures of $3,000,000 over a five year period. The Company retains a 1% net smelter royalty (NSR) on the property, with Silver Quest having the right to buy back 0.5% of the NSR for $375,000. If additional claims are staked within the areas of interest, Silver Quest will issue additional shares and the NSR will be extended to the new claims.  Wernecke Breccia Property The Company signed an agreement with Fronteer Development Group Inc. (Fronteer) to acquire 700 mineral claims and a proprietary geoscience dataset covering a large region of the northern Yukon known as the Wernecke Breccias, from Newmont Exploration Canada Limited and NVI Mining Ltd., a subsidiary of Breakwater Resources Ltd. Fronteer is the operator of the project and funded 100% of the required $2 million in exploration expenditures to earn an 80% interest, with the Company earning the remaining 20% interest. Newmont and NVI retain a total 2% NSR. There is a 7.5% to 15% Net Profits Interest (NPI) payable to the underlying vendors. A Joint Venture has been formed between Fronteer and the Company, and ongoing exploration expenses will be shared pro-rata subject to dilution for non-participation. Should either partys interest fall below 5%, their interest will be converted to a 3% NPI after payback of capital.  Alaska  Goodpaster Properties The Company signed an option agreement with Rubicon Minerals Corporation (Rubicon). The terms of the agreement provide that Rubicon is required to fund a total of USD$4.8 million in exploration expenditures over 6 years to earn a 60% interest in the properties. Upon vesting, Rubicon may acquire a further 10% interest in the properties by completing a feasibility study, and, at the Companys election, may acquire an additional 5% interest (for a total of 75%) by providing a project financing loan to be repaid from the Companys free cash flow upon production.  -117-  KISKA METALS CORPORATION  Notes to the Consolidated Financial Statements December 31, 2009, 2008 and 2007 (Expressed in Canadian Dollars)    7. MINERAL PROPERTY INTERESTS (continued)   Uncle Sam Property On November 2, 2009, the Company signed an option agreement with Millrock Resources Inc. (Millrock) giving Millrock the option to earn a 100% interest in the Uncle Sam property in Alaska. Under the terms of the agreement Millrock is required to make cash payments totaling US$200,000 over four years with US$40,000 being paid upon the TSX Venture Exchanges approval of the agreement. In addition, Millrock is required to issue 1,000,000 shares to Kiska over fours years and has made a commitment to spend US$2,700,000 on exploration over four years. There is an underlying 2% NSR payable to International Royalty Corporation.  Whistler Property Under the terms of a letter agreement dated June 2007 with Kennecott Exploration Company (Kennecott), the Company spent a total of US$5.0 million by December 31, 2008 and earned a 100% interest in the Whistler Project subject to a back-in right in favor of Kennecott or a 2% NSR if the back-in right is not exercised. An amendment to the agreement effective June 18, 2009 defines the required program which must be completed prior to Kennecott exercising the back in right. If Kennecott exercises its back-in rights it must refund two times the aggregate of the Companys exploration expenditures on the property and fund the Whistler exploration through a positive pre-feasibility study to achieve a 51% interest. Kennecott can elect to fund the project through to a positive development decision to earn a 60% interest.  Australia  Lachlan Fold Belt Project The Company signed a farm-in agreement with Inmet Mining (Australia) Pty. Ltd. (Inmet Australia) to explore the Barmedman licence. Inmet Australia can earn a 60% interest in the project by funding exploration expenditures of Australian (A) $5,000,000 over four years and making cash payments to the Company of A$250,000. The Company will be operator until completion of the option requirements. The property is subject to an underlying agreement which requires payment of fees based on exploration expenditures and includes a 2% NSR.   -118-  KISKA METALS CORPORATION  Notes to the Consolidated Financial Statements December 31, 2009, 2008 and 2007 (Expressed in Canadian Dollars)    7. MINERAL PROPERTY INTERESTS (continued)   Victoria Goldfields Effective June 27, 2008, the Company signed a letter of agreement for a farm-in and joint venture with Northgate Australian Ventures (Northgate Ventures) for three mining tenements in the Stawell Corridor of the Victoria Goldfields. The Company can earn a 50% interest in one or all of the three properties by funding an additional A$500,000 per property by March 31, 2011 with a minimum expenditure of A$150,000 per property per year.  Upon the Company earning a 50% interest in one or more properties, Northgate Ventures will have the option to earn a 60% interest in the property by funding an additional A$1.5 million in exploration expenditures within 3 years, to form a 50:50 joint venture with the Company or elect not to contribute and allow the Company to earn a 100% interest in the property by funding an additional A$2 million in exploration expenditures over 4 years.  Mexico  At year end, the company held an interest in fifteen projects in Sonora, Durango and Sinaloa States in Mexico. Twelve projects were held in a 60/40 Joint Venture with Azure Minerals Limited (60%). All projects were subject to certain back in rights held by Minera Kennecott Exploration S.A. de C.V. (MKE) with the exception of La Noria in Sinaloa State where MKE has relinquished its back in rights and now holds a 2% Net Smelter Royalty. Subsequent to year end, MKE relinquished its back in rights and now holds a 2% Net Smelter Royalty on all projects. At the same time, an agreement was concluded with Azure Minerals Limited terminating the joint venture. The Company retains 100% interest in a total of nine properties, subject to the 2% NSR in favour of MKE, including six of the former joint venture properties.     -119-  KISKA METALS CORPORATION  Notes to the Consolidated Financial Statements December 31, 2009, 2008 and 2007 (Expressed in Canadian Dollars)     8. EQUITY INVESTMENT  As at December 31, 2009, the Company owned 28,506,883 ordinary shares of Clancy Exploration Limited (Clancy), which represents 37.9% of Clancys issued and outstanding shares.  On March 9, 2007, Clancy completed a stock split of 100:1, resulting in the Company owning 12,000,000 shares in Clancy, representing 100% of the outstanding shares. On March 7, 2007 and May 8, 2007, Clancy issued 2,600,000 and 800,000 shares, respectively, to Clancys then-parent company, Geoinformatics Exploration Australia Pty Ltd ("GEA"), a subsidiary of the Company, in partial satisfaction of an inter-company loan arising from services provided and expenditures incurred from December 1, 2007 to April 30, 2007. On May 8, 2007, Clancy issued 4,600,000 shares to GEA as consideration for the acquisition of a 100% interest in the share capital of Geoinformatics Exploration Tasmania Pty Ltd. (Tasmania). On May 8, 2007, Clancy issued 2,643,750 shares to GEA as consideration for the acquisition of 911,250 shares in Bass Metals Limited and an additional 161,756 shares were issued to GEA as consideration for the acquisition of 250,000 unlisted options and 56,250 listed options, in Bass Metals Limited.  On May 22, 2007, Clancy filed its prospectus with the Australian Stock Exchange (ASX) for an initial public offering of common shares (IPO). Clancys shares began trading on the ASX on July 7, 2007 under the trading symbol CLY. On the same date, Clancy closed its IPO of 25,000,000 common shares at a price of Australian dollars $0.20 per common share for gross proceeds of A$5,000,000. The Company did not participate in the public offering and as a result its ownership interest decreased from 100% to 47.7%.  Prior to July 1, 2007, the Company consolidated the accounts of Clancy and Tasmania. Effective July 1, 2007, the Company commenced accounting for its investment in Clancy on an equity basis, and as a result, the following assets and liabilities were deconsolidated at that date: cash of A$381,465, current assets of A$41,667 and current liabilities of A$803,736. Following the dilution of the Companys shareholding interest in Clancy, the Company recognized a dilution gain and equity loss on its investment in Clancy.  During June 2009, Clancy completed a rights offering whereby Clancy ordinary shares were offered at A$0.08 per share (the Rights Offering) raising approximately A$1,000,000. Pursuant to the Rights Offering the Company acquired an additional 5,701,377 ordinary shares for a total cash consideration of A$456,110 (C$410,398). In December 2009, Clancy completed a share purchase plan in which the Company did not participate. Including private placements during the year, Clancy issued 14,621,793 shares. As a result the Companys interest decreased from 47.7% to 37.9%.   -120-  KISKA METALS CORPORATION  Notes to the Consolidated Financial Statements December 31, 2009, 2008 and 2007 (Expressed in Canadian Dollars)     8. EQUITY INVESTMENT (continued)  For the years ended December 31, 2009, 2008 and 2007, the Company recorded an equity loss on its investment on Clancy as follows:  200920082007Balance, beginning of year$           765,747$    1,681,928$        252,965Acquisition of ordinary shares410,398--Dilution gain on issuance of shares by Clancy--1,646,124Equity in loss of Clancy(1,176,145)(916,181)(217,161)Balance, end of year$                       -$       765,747$     1,681,928  For the years ended December 31, the Company had the following transactions with Clancy.  2009
A$2008
         A$2007
   A$Revenue earned from services provided to Clancy$             -$    137,268$   154,746Revenue earned from equipment sold to Clancy1964,246-Expenses paid by the Company on behalf of Clancy--10,000Services purchased from Clancy-6,24015,619Expenses paid by Clancy on behalf of the Company2,60811,3903,310Amounts received from Clancy in settlement of trade and other receivables116158,682-Amounts paid to Clancy on trade and other payables-26,156-Loan repayment by Clancy, on behalf of its subsidiary, 
Geoinformatics Exploration Tasmania Pty Ltd.-1,649-  The average foreign exchange rate for the year ended December 31, 2009 for $1 Canadian dollar was A$1.1003 (2008 A$1.1269, 2007 - A$1.1160).  The carrying value and market value of the Clancy shares held by the Company and accounted for using the equity basis are as follows:  20092008Investment in Clancy on an equity basis$                          -$               765,747Market value of Clancy shares3,767,8691,169,922    -121-  KISKA METALS CORPORATION  Notes to the Consolidated Financial Statements December 31, 2009, 2008 and 2007 (Expressed in Canadian Dollars)     9. PROPERTY PLANT AND EQUIPMENT  December 31, 2009CostAccumulated depreciationNet book valueAppliances$          98,094$          (37,593)$          60,501Camp structures286,309(109,937)176,372Computer software36,456(24,103)12,353Computer equipment122,843(87,713)35,130Field equipment73,548(15,249)58,299Leasehold improvements20,502(6,407)14,095Mobile equipment121,821(75,739)46,082Niton Analyzer43,586(20,149)23,437Office equipment and furniture62,124(9,111)53,013$       865,283$        (386,001)$       479,282  December 31, 2008CostAccumulated depreciationNet book valueAppliances$          92,019$          (2,343)$          89,676Camp structures275,097(7,012)268,085Computer software43,039(30,591)12,448Computer equipment480,337(421,530)58,807Field equipment64,361(20,488)43,873Leasehold improvements28,697(25,332)3,365Mobile equipment84,699(40,156)44,542Niton Analyzer43,586(5,732)37,855Office equipment and furniture59,019(36,859)22,160$      1,170,854$        (590,043)$       580,811   10. RELATED PARTY TRANSACTIONS  The following transactions are measured at the exchange amount, which is the amount of the consideration established and agreed to by the related parties.   -122-  KISKA METALS CORPORATION  Notes to the Consolidated Financial Statements December 31, 2009, 2008 and 2007 (Expressed in Canadian Dollars)     10. RELATED PARTY TRANSACTIONS (continued)  (a) Note Payable On March 9, 2009, the Company announced it had negotiated a line of credit with Geologic Resource Partners LP (GRP), a company with directors in common, allowing it to draw down, as necessary, a maximum amount of $2.6 million. The line of credit bore interest at an annual rate of 15%, payable at maturity. On March 27, 2009 and June 8, 2009, the Company drew $1,000,000 and $750,000, respectively, under the line of credit. The entire amount of note payable including accrued interest of $71,712 was repaid on August 5, 2009.  On October 10, 2008, the Company closed a $5.5 million short-term bridge loan (the Bridge Loan) with GRP, allowing it to draw down, as necessary, the full amount of the Bridge Loan. The Company had drawn a total of US$2.5 million under the Bridge Loan as at October 10, 2008. GRP is the investment manager for Geologic Resource Opportunities Fund LP and Geologic Resource Fund LP (collectively GRF). GRF owned approximately 17% of the outstanding common shares of the Company as at October 10, 2008.  Advances under the Bridge Loan bore interest at a rate equal to 12% per annum. As security for the Bridge Loan, the Company pledged all of the shares of its direct material subsidiary. Advances under the Bridge Loan were used by the Company to fund its exploration activities and for general working capital purposes. On October 17, 2008, the Company closed a private placement with GRF and used a portion of those proceeds to repay the US$2.5 million outstanding balance of the Bridge Loan. The Company incurred a total of $33,014 in interest charges during the term of the Bridge Loan which is included in its statement of operations.  (b) ZED Financial Partners (ZED) ZED is a financial advisory firm which provided certain services to the Company and a former director of the Company is a principal of ZED. The Company engaged ZED, commencing April 1, 2006, on a monthly retainer of $13,000 which was terminated October 31, 2007. During the years ended December 31, 2009 and 2008, no amounts were paid to ZED (2007 - $130,000).  (c) Due to related party Some of the Companys mineral property evaluation and exploration projects are managed by Equity Exploration Consultants Ltd. and Equity Geoscience, Ltd. (collectively Equity), companies partially owned (indirectly) by a director of the Company. Balances payable to Equity for fees and reimbursement of costs incurred on behalf of the Company have been separately disclosed as part of Due to Related Party. Fees charged to the Company by Equity are on the same basis as those charged by Equity to unrelated third parties. It is anticipated that Equity will continue to provide geological consulting and administrative support services to the Company from time to time, and will be remunerated for such services at the rate charged by Equity to all its customers.   -123-  KISKA METALS CORPORATION  Notes to the Consolidated Financial Statements December 31, 2009, 2008 and 2007 (Expressed in Canadian Dollars)     10. RELATED PARTY TRANSACTIONS (continued)  (c) Due to related party At December 31, 2009, the Company was indebted to Equity in the amount of $11,340 (2008 - $nil) for project expenses and consulting services provided by Equity to the Company. During the year ended December 31, 2009, the Company paid Equity $54,000 (2008 - $nil, 2007 - $nil) for providing management services, which has been included in consulting and outsourced services on the Statement of Operations and Comprehensive Loss.  Included in due to related party at December 31, 2008 is an amount of $225,000 representing the severance payment due to an officer upon a change of control of the Company.  (d) Mineral property interests One of the directors indirectly owns 11% of a 7.5% to 15% Net Profits Interest (NPI) in the Wernecke Breccia property. The claims were originally staked and explored by a company in which he holds an interest. When the property was sold to the Newmont and NVI Mining Ltd, that company retained an NPI of varying amounts depending on the claim group.  (e) Fractal Technologies Pty Ltd. (Fractal) Fractal is a wholly-owned subsidiary of Fractal Holdings Pty Ltd., which held a 15.6% interest in Geoinformatics up until June 30, 2007. On June 30, 2007, Fractal Holdings Pty Ltd. distributed its holding of 20 million Geoinformatics common shares to its two shareholders pursuant to a corporate reorganization. The shares were transferred equally to Geocrust Pty Ltd., a corporation controlled by Geoinformatics previous Chief Executive Officer and his spouse, and Geo Holdings (IIF) Pty Ltd., a corporation controlled by Foundation IIF Partnership, an Australian venture capital fund.  Fractal is a developer of database software which licenses its commercial software to mining and resource industry users. Geoinformatics entered into a software licensing agreement with Fractal in 2002, under which Geoinformatics was charged a monthly licensing fee of AUD$3,500 by Fractal for use of its software. During the years ended December 31, 2009 and 2008, the Company did not have any transactions with Fractal, other than the payment of the monthly licensing fee, which is no longer considered a related party transaction.  Transactions with Fractal for the six months ended June 30, 2007, the date at which Fractal ceased to be a related party, are summarized as follows:


|                                                          |                  |                  |             
|--------------------------------------------------------- | ---------------- | ---------------- | ------------
|Description of transaction                                | 2009             | 2008             | 2007        
|Software licensing fees incurred by Geoinformatics        | $              - | $              - | $     21,152
|Services provided by Fractal to Geoinformatics            | -                | -                | 1,674       
|Expenses incurred by Geoinformatics reimbursed by Fractal | -                | -                | 6,255       

-124-  KISKA METALS CORPORATION  Notes to the Consolidated Financial Statements December 31, 2009, 2008 and 2007 (Expressed in Canadian Dollars)     11. CONVERTIBLE LOAN FACILITY  On February 12, 2006, the Company entered into a binding letter agreement with Geologic Resource Fund LP (GRF) in which GRF agreed to make available to the Company a US$20 million unsecured convertible loan facility (the Facility) in two tranches, subject to certain terms and conditions. On August 29, 2006, the Company and GRF executed formal loan documentation amending and implementing the February 2006 letter agreement, pursuant to which GRF made the Facility available to the Company, on a secured basis.  On January 17, 2007, the Company completed the initial drawdown of US$10 million (Cdn$11,746,000) under the Facility and, on April 3, 2007, the Company completed the second drawdown of US$10 million (Cdn$11,573,000). Advances under the Facility bore interest at 5% per annum payable semi-annually and was convertible into common shares of the Company at the option of GRF at a conversion rate of $0.25 per share until August 28, 2008 and thereafter at a conversion rate of $0.275 per share. The Facility was to mature on August 28, 2009.  The Chief Investment Officer of GRF was a member of the Board of Directors of the Company. GRF owned a 40.4% interest in the Company as at December 31, 2009 (2008 - 84.9%, 2007  15.4%).  The Company paid a commitment fee of 5% per annum in respect of the funds available under the second tranche of the Facility from August 29, 2006 until it was drawn upon on April 3, 2007. The Company had the option of paying both interest and the commitment fee on the Facility in either cash or shares with the effective issue price of the shares equal to the average closing price of the Companys shares for the 20 trading days ending 5 business days prior to such payment date.  On January 16, 2007, the Company issued 39,878 common shares at a price of $5.00 to GRF in satisfaction of a commitment fee of $199,793 for the period August 29, 2006 to December 31, 2006. On August 2, 2007, the Company issued 72,553 common shares at a price of $6.96 to GRF in satisfaction of (i) the commitment fee of $134,270 from January 1, 2007 to the drawdown of the second tranche and (ii) interest of $370,701 for the period January 17, 2007 to June 30, 2007.  On January 16, 2007 and April 3, 2007, the dates of the draw downs of the first and second tranches, respectively, the gross proceeds of US$10 million (Cdn$11,746,000) and US$10 million (Cdn$11,573,000) were allocated to the relative fair values of the loan (US$8,141,300 and US$7,981,192) and the holders option to convert the principal balance into common shares (US$1,858,700 and US$2,018,808) (the Conversion Option). The US$16,122,492 (Cdn$16,876,642) fair value of the loans was classified as a liability, while the US$3,877,508 (Cdn$4,523,973) allocated to the Conversion Option was classified as a separate component within shareholders equity.   -125-  KISKA METALS CORPORATION  Notes to the Consolidated Financial Statements December 31, 2009, 2008 and 2007 (Expressed in Canadian Dollars)     11. CONVERTIBLE LOAN FACILITY (continued)  On January 28, 2008, the Company issued 112,509 common shares at a price of $4.42 to GRF in satisfaction of accrued interest in the amount of $497,008 for the period July 1, 2007 to December 31, 2007.  Over their term, the loans were accreted to their face value through a periodic charge to accretion expense with a corresponding credit to the liability component. The accretion expense was based on the effective interest rate method.  For the year ended December 31, 2008, the Company recorded accretion expense of $2,465,774 (2007 - $1,157,426) related to the loans, which is included in financing expense.  On October 20, 2008, the Company closed an equity financing and used a portion of the proceeds to repay the outstanding balance of US$20 million under the convertible loan facility. The Company recorded a settlement gain of $279,859 upon repayment and a realized foreign exchange loss of $2,885,734. In addition, the Company issued 1,065,907 common shares to GRF in satisfaction of the interest of $943,327 on the convertible loan facility for the period from January 1, 2008 to October 16, 2008.   12. LEASE OBLIGATIONS  The Company has a sublease, which expires November 30, 2010, for office space occupied by its head office. The Company has made a prepayment of the final two months lease payments. At December 31, 2009, the Company has future minimum annual lease commitments as follows:  December 31, 2010December 31, 2011 and beyondLease payment$    54,603$               -Operating costs (estimate)40,952-Total$   95,555$               -    -126-  KISKA METALS CORPORATION  Notes to the Consolidated Financial Statements December 31, 2009, 2008 and 2007 (Expressed in Canadian Dollars)     13. RECLAMATION OBLIGATIONS  The Companys exploration activities are subject to various federal, provincial and state laws and regulations governing the protection of the environment. These laws and regulations are continually changing and generally becoming more restrictive. The Company conducts its operations so as to protect public health and the environment, and believes its operations are materially in compliance with all applicable laws and regulations. The Company has made, and expects to make in the future, expenditures to comply with such laws and regulations. Managements current estimate of reclamation and other future site restoration costs to be incurred for existing mineral property interests has been included in these financial statements as reclamation obligations. The undiscounted amount of the estimated cash flows required to settle the obligations, which are expected to be paid over the next four years, is $392,118.  The discount rate used to determine the present value of the estimated cash flows is 2.25%.  Balance, December 31, 2007 and 2008$                     -Reclamation obligations assumed on acquisition (Note 1)45,562Reclamation obligations recognized355,829Balance, December 31, 2009$         401,391  14. SHARE CAPITAL  (a) Common shares  Authorized: Unlimited common shares without par value Issued and fully paid common shares Number of SharesAmountDecember 31, 20063,789,822$17,751,886Issued in satisfaction of convertible loan interest and commitment fee112,432704,764Issued upon exercise of options including transfer
 from contributed surplus3,26734,914Issued upon exercise of flow-through warrants581,0393,486,231Share issue costs-(1,635,233)December 31, 20074,486,56020,342,562Issued for cash on private placement19,552,00029,328,000Issued in satisfaction of interest on convertible loan1,178,4161,440,335Issued upon exercise of options including transfer 
from contributed surplus18,300172,866Share issue costs-(1,235,721)December 31, 200825,235,27650,048,042  -127-  KISKA METALS CORPORATION  Notes to the Consolidated Financial Statements December 31, 2009, 2008 and 2007 (Expressed in Canadian Dollars)     14. SHARE CAPITAL (continued)  (a) Common shares  December 31, 200825,235,27650,048,042Issued for acquisition (Note 1)22,365,25812,412,717Issued for cash on private placement9,000,0004,950,000Allocation to fair value of warrants issued in private placement-(1,267,650)Issued upon exercise of options including transfer 
from contributed surplus140,827106,547Share issue costs-(590,618)December 31, 200956,741,361$65,659,038  On December 22, 2008, the Company completed a 1 for 10 stock consolidation which had been approved at a special meeting of shareholders held on October 15, 2008. On August 5, 2009, the Company completed a further 1 for 3 stock consolidation which had been approved at a special meeting of shareholders held on July 30, 2009. All share amounts in these consolidated financial statements have been revised to reflect the effects of the stock consolidations.  On September 16, 2009 the Company closed a private placement upon which it issued 9,000,000 common shares at $0.55 for proceeds of $4,950,000, and granted warrants for the purchase of 4,500,000 common shares at $0.80 per share, expiring on March 16, 2011. The Company also granted broker warrants for the purchase of 540,000 common shares at $0.80 per share, expiring on March 16, 2011.  The Company issues share purchase options to directors, officers and employees of the Company and persons who provide ongoing services to the Company under an incentive stock option plan. The aggregate number of shares of the Company that may be granted pursuant to the Plan is limited to 10% of the issued and outstanding shares of the Company. The Plan is administered by the Board of Directors, which determines individual eligibility under the Plan, the number of shares optioned to each grantee and the vesting period. The exercise price of share purchase options will be no less than the closing price of the shares on the TSX Venture Exchange on the date on which the option is granted. Options will expire no later than five years from the grant date, except that they will expire within thirty days when the holder is no longer qualified to hold the option (other than for cause, when the option will expire immediately). Individual grants vest over two years with one-half vesting immediately, one-quarter vesting on the first anniversary date of the grant and the remaining one-quarter vesting on the second anniversary date. Individual grants of up to 25,000 shares vest immediately.   -128-  KISKA METALS CORPORATION  Notes to the Consolidated Financial Statements December 31, 2009, 2008 and 2007 (Expressed in Canadian Dollars)     14. SHARE CAPITAL (continued)  (b) Incentive stock options (continued)  Details of outstanding share purchase options are as follows:


| |                                    |                   |                                 |                   |                  |                                
| | ---------------------------------- | ----------------- | ------------------------------- | ----------------- | ---------------- | -------------------------------
| |                                    | December 31, 2009 |                                 | December 31, 2008
| |                                    | Number of shares  | Weighted average exercise price |                   | Number of shares | Weighted average exercise price
| | Outstanding at beginning of year   | 134,808           | $         8.61                  |                   | 337,783          | $         7.47                 
| | Granted                            | 3,353,328         | 0.65                            |                   | 3,600            | 7.50                           
| | Issued on acquisition (Note 1)     | 1,905,300         | 1.51                            |                   | -                | -                              
| | Exercised                          | (140,827)         | 0.42                            |                   | (20,200)         | 6.90                           
| | Expired                            | (169,650)         | 1.33                            |                   | (18,300)         | 5.40                           
| | Forfeit/Cancelled                  | (699,115)         | 1.87                            |                   | (168,075)        | 6.66                           
| | Outstanding at end of year         | 4,383,844         | $         1.06                  |                   | 134,808          | $         8.61                 
| | Options exercisable at end of year | 2,771,982         | $         1.30                  |                   | 125,318          | $          7.32                

The following share purchase options are outstanding at December 31, 2009.


| |                   |                                        |                                        |                 |                                
| | ----------------- | -------------------------------------- | -------------------------------------- | --------------- | -------------------------------
| | Expiry Date       | Options Outstanding
(number of shares) | Options Exercisable
(number of shares) | Exercise price  | Weighted Average Remaining Life
| | March 10, 2010    | 1,333                                  | 1,333                                  | $          9.30 | 0.19                           
| | December 22, 2010 | 87,000                                 | 87,000                                 | 1.36            | 0.98                           
| | June 27, 2011     | 7,500                                  | 7,500                                  | 7.50            | 1.49                           
| | July 17, 2011     | 556,800                                | 556,800                                | 1.90            | 1.54                           
| | January 11, 2012  | 100,050                                | 100,050                                | 2.29            | 2.03                           
| | July 16, 2012     | 287,100                                | 287,100                                | 2.24            | 2.54                           
| | August 1, 2012    | 14,331                                 | 14,331                                 | 6.90            | 2.59                           
| | December 10, 2012 | 208,800                                | 208,800                                | 1.84            | 2.95                           
| | July 16, 2013     | 78,300                                 | 78,300                                 | 0.98            | 3.54                           
| | December 19, 2013 | 208,800                                | 193,575                                | 0.17            | 3.97                           
| | March 1, 2014     | 130,500                                | 65,250                                 | 0.25            | 4.17                           
| | March 19, 2014    | 1,183,330                              | 394,443                                | 0.45            | 4.22                           
| | December 15, 2014 | 1,520,000                              | 777,500                                | 0.90            | 4.96                           
| |                   | 4,383,844                              | 2,771,982                              |                 | 3.81                           

-129-  KISKA METALS CORPORATION  Notes to the Consolidated Financial Statements December 31, 2009, 2008 and 2007 (Expressed in Canadian Dollars)     14. SHARE CAPITAL (continued)  (b) Incentive stock options (continued)  The weighted average grant-date fair value of share purchase options granted during the year ended December 31, 2009 was $0.41 per share (2008 - $0.37; 2007 - $0.53). The Company determines the fair value of the options for the purposes of determining share-based compensation expense using the Black-Scholes option pricing model and used the following weighted average assumptions:


| |                         |                   |  |                   |  |                  
| | ----------------------- | ----------------- |  | ----------------- |  | -----------------
| |                         | December 31, 2009 |  | December 31, 2008 |  | December 31, 2007
| | Volatility              | 96%               |  | 105%              |  | 78.32% & 105%    
| | Risk-free interest rate | 2.02%             |  | 2.88%             |  | 3.68% & 4.3%     
| | Expected life           | 4.3 years         |  | 5 years           |  | 5 years          
| | Expected dividend yield | -                 |  | -                 |  | -                

The expected life of options is determined using historical records comparing grate date to exercise or forfeiture date for each of the option groups (employees, officers and directors). The volatility is calculated using the closing price of the common shares over the same period as the expected life of the option granted. The riskfree interest rate is determined from the latest zero-coupon yield rate as published by the Bank of Canada for the period which most closely matches the expected life of the option.  The total share-based compensation expense charged against operations for the year ended December 31, 2009 was $544,872 (2008 - $76,461, 2007 - $761,482), of which $120,356 has been allocated to exploration expenditures (2008 - $nil, 2007 - $nil). The total share-based compensation cost related to non-vested awards not yet recognized is $640,616, to be recognized over a weighted-average 1.1 years.   -130-  KISKA METALS CORPORATION  Notes to the Consolidated Financial Statements December 31, 2009, 2008 and 2007 (Expressed in Canadian Dollars)     14. SHARE CAPITAL (continued)  (c) Warrants  Details of outstanding warrants are as follows:


| |                                  |                   |                                 |                   |                  |                                
| | -------------------------------- | ----------------- | ------------------------------- | ----------------- | ---------------- | -------------------------------
| |                                  | December 31, 2009 |                                 | December 31, 2008
| |                                  | Number of shares  | Weighted average exercise price |                   | Number of shares | Weighted average exercise price
| | Outstanding at beginning of year | -                 | $               -               |                   | -                | $               -              
| | Issued on equity financing       | 5,040,000         | 0.80                            |                   | -                | -                              
| | Exercised                        | -                 | -                               |                   | -                | -                              
| | Expired                          | -                 | -                               |                   | -                | -                              
| | Outstanding at end of year       | 5,040,000         | $        0.80                   |                   | -                | $               -              

The following warrants are outstanding at December 31, 2009.  Number ofIssue PriceSharesPer ShareExpiry DateBroker Warrants540,000$       0.80March 16, 2011Share Purchase Warrant4,500,0000.80March 16, 20115,040,000       15. INCOME TAXES  The Companys future income tax assets and liabilities are:


| |                                        |                                 |                          |                                 |                          
| | -------------------------------------- | ------------------------------- | ------------------------ | ------------------------------- | -------------------------
| |                                        |                                 | December 31             
| |                                        |                                 | 2009                     |                                 | 2008                     
| | Future income tax assets (liabilities) |                                 |                          |                                
| |                                        | Mineral property interests      | $              2,483,279 |                                 | $                 830,749
| |                                        | Other assets                    | 3,572                    |                                 | 571,067                  
| |                                        | Marketable securities           | 669                      |                                 | 131,196                  
| |                                        | Investments                     | 168,938                  |                                 | (37,183)                 
| |                                        | Tax loss carry-forwards         | 14,478,391               |                                 | 12,808,752               
| |                                        |                                 | 17134,849                |                                 | 14,304,581               
| |                                        | Valuation allowance             | (17,134,849)             |                                 | (14,304,581)             
| | Net future income tax assets           | $                             - |                          | $                             -

-131-  KISKA METALS CORPORATION  Notes to the Consolidated Financial Statements December 31, 2009, 2008 and 2007 (Expressed in Canadian Dollars)     15. INCOME TAXES (continued)  A reconciliation of the provision for income taxes is as follows:


| |                                                                |                                                             |                                    |                  |             |                      |             |          
| | -------------------------------------------------------------- | ----------------------------------------------------------- | ---------------------------------- | ---------------- | ----------- | -------------------- | ----------- | ---------
| |                                                                |                                                             | Year ended December 31            
| |                                                                |                                                             | 2009                               |                  | 2008        |                      | 2007       
| | Loss before income taxes                                       | $     (18,687,266)                                          |                                    | $   (17,355,320) |             | $    (16,003,626)   
| |                                                                |                                                             |                                    |                  |             |                     
| | Combined Canadian and provincial statutory tax rates           | 30.0%                                                       |                                    | 32.5%            |             | 36.12%              
| |                                                                |                                                             |                                    |                  |             |                     
| | Recovery of income taxes based on combined statutory tax rates | $         5,606,180                                         |                                    | $   5,640,479    |             | $          5,780,510
| |                                                                |                                                             |                                    |                  |             |                      |            
| | Add (deduct):                                                  |                                                             |                                    |                  |             |                     
| |                                                                | Higher (lower) effective tax rates in foreign jurisdictions | 67,116                             |                  | 127,074     |                      | (108,081)  
| |                                                                | Impact of renunciation of flow-through expenditures         |                                    |                  |             |                      | 1,543,338  
| |                                                                | Non-deductible expenses                                     |                                    |                  |             |                      |            
| |                                                                |                                                             | Share-based compensation           | (130,217)        |             | (24,850)             |             | (275,047)
| |                                                                |                                                             | Equity investment dilution gain    | -                |             | -                    |             | 594,580  
| |                                                                |                                                             | Accretion expense                  |                  |             | (801,377)            |             | (418,063)
| |                                                                |                                                             | Mineral property acquisition costs | (2,392,286)      |             | -                    |             | -        
| |                                                                |                                                             | Other                              | (546,570)        |             | 319,594              |             | 90,786   
| |                                                                | Tax effect of current period losses not recognized          | (2,604,223)                        |                  | (4,166,341) |                      | (5,679,032)
| |                                                                | Future income tax asset not previously recognized           | 2,763                              |                  | -           |                      |            
| | Income tax recovery                                            | $                2,763                                      |                                    | $     1,094,579  |             | $        1,528,991  

-132-  KISKA METALS CORPORATION  Notes to the Consolidated Financial Statements December 31, 2009, 2008 and 2007 (Expressed in Canadian Dollars)     15. INCOME TAXES (continued)  At December 31, 2009, the Company has unrecognized losses for income tax purposes of approximately $50,074,000 which may be used to offset taxable incomes of future years. If unused, these losses will expire as follows:  2010$3,304,0002014933,00020152,460,000202310,000202423,0002025177,00020265,323,000202712,217,000202818,122,00020297,505,000$50,074,000  The Company also has unrecognized resource related tax deductions of approximately $8,042,000 available for deduction against future Canadian taxable income, which can be carried forward indefinitely.  In assessing the Companys ability to utilize future tax assets, management considers whether it is more likely than not that some portion or all of the future tax assets will be realized. The ultimate realization of future tax assets is dependent upon the generation of future taxable income during the periods in which those temporary differences are or become deductible or during the periods before expiry of the loss carryforwards. Management considers the scheduled reversal of future tax liabilities, projected future taxable income, and tax planning strategies in making this assessment. Based upon the level of historical taxable income and projections for future taxable income over the periods in which tax assets are deductible, management currently believes it is more likely than not that the Company will not realize the benefits of the future income tax assets.    -133-  KISKA METALS CORPORATION  Notes to the Consolidated Financial Statements December 31, 2009, 2008 and 2007 (Expressed in Canadian Dollars)     16. CAPITAL MANAGEMENT  The Companys objective when managing capital, which is unchanged from prior years, is to safeguard the Companys ability to continue as a going concern so that it can continue to provide returns to shareholders and benefits for other stakeholders in the development of its mineral properties. The Company considers its capital to include the components of shareholders equity.  The Companys capital structure reflects that of a company focused on mineral exploration and financing both internal and external growth opportunities. The exploration for and development of mineral deposits involves significant risk which even a combination of careful evaluation, experience and knowledge may not adequately mitigate.  The Company manages and adjusts its capital structure when changes to the risk characteristics of the underlying assets or changes in economic conditions occur. To maintain or adjust the capital structure, the Company may issue new shares or acquire or dispose of mineral property interests. The Company is not subject to externally imposed capital requirements.  In order to facilitate the management of its capital requirements, the Company prepares annual expenditure budgets which are revised periodically based on the results of its exploration programs, availability of financing and industry conditions. Annual and materially updated budgets are approved by the Board of Directors.  In order to maximize ongoing development efforts, the Company does not pay out dividends. The Companys investment policy is to invest any excess cash in liquid short-term interest-bearing instruments with maturities of one year or less. When utilized, these instruments are selected with regard to the expected timing of expenditures from continuing operations.   -134-  KISKA METALS CORPORATION  Notes to the Consolidated Financial Statements December 31, 2009, 2008 and 2007 (Expressed in Canadian Dollars)     17. RISK MANAGEMENT  The Companys activities expose it to a variety of financial risks, which include market risk, foreign currency risk, interest rate risk, credit risk and liquidity risk. The Companys risk management program focuses on the unpredictability of financial markets and seeks to minimize potential adverse effects on the Companys financial performance.  Market Risk The Companys financial instruments include marketable securities which are publicly traded and therefore are subject to the market risks that affect all publicly traded securities. Some of these investments are thinly traded which could result in lower quoted market values. The Company monitors the market of these securities and sells appropriate portions of the portfolio when price and market conditions permit. When the value of individual marketable securities is determined to have suffered impairment due to investee circumstances or project developments, the resulting loss is reported in the statement of operations as a loss on marketable securities.  Foreign Currency Risk The Company incurs certain expenses in currencies other than the Canadian dollar which is the functional currency for the Company. The Company is subject to foreign exchange risk as a result of fluctuations in exchange rates. The Company manages this risk by maintaining bank accounts in US Dollars, Australian Dollars and Mexican Pesos related to its United States, Australian and Mexican operations, to pay these foreign currency expenses as they arise. Receipts in foreign currencies are maintained in those currencies. The Company does not undertake currency hedging activities. The Company also does not attempt to hedge the net investment and equity of integrated foreign operations. During the year ended December 31, 2009, as a result of fluctuations of the Canadian dollar, the Company recognized a foreign exchange gain of $68,760 in operations. During the year ended December 31, 2008, the Company recognized a foreign exchange loss of $3,130,547 (2007  gain of $1,137,511) which was mainly attributable to the US denominated convertible loan facility as described in Note 11.  Interest Rate Risk The Companys financial instruments may include bankers acceptances and treasury bills. These instruments bear a fixed rate of interest and a fixed maturity date of one year or less. If the Company is required to liquidate them prior to the maturity date, there is a risk that interest rates will have increased such that the market value of the instrument is less than the carrying or face value. As at December 31, 2009, the Company did not hold any of this type of financial instrument. The Company maintains term deposits with varying maturity dates to take advantage of changing interest rates and to ensure that sufficient funds are available when required.   -135-  KISKA METALS CORPORATION  Notes to the Consolidated Financial Statements December 31, 2009, 2008 and 2007 (Expressed in Canadian Dollars)     17. RISK MANAGEMENT (continued)  Credit Risk Credit risk is the risk of an unexpected loss if a customer or third party to a financial instrument fails to meet its contractual obligations. To reduce credit risk, cash and cash equivalents are on deposit at major financial institutions. Credit risk relating to amounts receivable arises from the possibility that any counterparty to an instrument fails to perform. The majority of the Companys receivables relate to recoveries of the Goods and Services Tax, and the Company is not aware of any counterparty risk that could have an impact on the fair value of such receivables.  Liquidity Risk Liquidity risk is the risk that the Company will not be able to meet its financial obligations as they fall due. Accounts payable and accruals are due within the current operating period. The Company manages liquidity risk through the management of its capital structure (Note 16).  The Company uses sensitivity analysis to measure the effect on total assets or total receipts of reasonably foreseen changes in interest rates and foreign exchange rates. The analysis is used to determine if these risks are material to the financial position of the Company. On the basis of current market conditions, the Company has determined that a 1% change in interest rates would affect the expected total receipts by 4.6% and a 10% change in foreign exchange rates would affect the fair value of total assets by 4.0%. Actual financial results for the coming year will vary since the balances of financial assets are expected to decline as funds are used for Company expenses.   18. OPERATING SEGMENTS  The Company operates in one industry segment, mineral exploration, within four geographic areas: Canada, United States, Australia, and Mexico. All subsidiaries are operated as one entity with management in common located at the Companys head office. There is an inactive subsidiary in Ireland.   -136-  KISKA METALS CORPORATION  Notes to the Consolidated Financial Statements December 31, 2009, 2008 and 2007 (Expressed in Canadian Dollars)     18. OPERATING SEGMENTS (continued)  The following table shows the assets attributable to each geographical area at the balance sheet dates:


|                  |                                    |               |             |            |               |                      |             
|----------------- | ---------------------------------- | ------------- | ----------- | ---------- | ------------- | -------------------- | ------------
|December 31, 2009 | Canada                             | United States | Australia   | Mexico     | Ireland       | Total               
|                  | (Restated  
Note 3)               |               |             |            |               | (Restated 
 Note 3)
|Current Assets    |                                    |               |             |            |               |                     
|                  | Cash and cash equivalents          | $     665,016 | $    51,966 | $  325,760 | $  28,837     | $           116      | $  1,071,695
|                  | Restricted cash                    | 106,346       | 27,500      | 18,882     | -             | 49,979               | 202,707     
|                  | Marketable securities              | 370,417       | -           | -          | -             | -                    | 370,417     
|                  | Amounts receivable                 | 40,116        | 2           | 2,156      | 9,482         | -                    | 51,756      
|                  | Prepaid expenses and deposits      | 78,650        | 69,623      | 3,765      | -             | -                    | 152,038     
|                  | 1,260,545                          | 149,091       | 350,563     | 38,319     | 50,095        | 1,848,613           
|                  |                                    |               |             |            |               |                      |             
|                  | Equity investment                  | -             | -           | -          | -             | -                    | -           
|                  | Property, plant and equipment, net | 116,915       | 341,696     | 1,450      | 19,221        | -                    | 479,282     
|                  | Goodwill                           | -             | -           | -          | -             | -                    | -           
|Total Assets      | $  1,377,459                       | $  490,787    | $  352,013  | $   57,540 | $      50,095 | $  2,327,895        
|                  |                                    |               |             |            |               |                     




|                  |                                    |               |              |             |               |                |              
|----------------- | ---------------------------------- | ------------- | ------------ | ----------- | ------------- | -------------- | -------------
|December 31, 2008 | Canada                             | United States | Australia    | Mexico      | Ireland       | Total         
|Current Assets    |                                    |               |              |             |               |               
|                  | Cash and cash equivalents          | $    603,139  | $      9,651 | $   68,819  | $   33,230    | $       47,721 | $     762,560
|                  | Restricted cash                    | 41,559        | 40,669       | -           | -             | -              | 82,228       
|                  | Marketable securities              | 120,532       | -            | -           | -             | -              | 120,532      
|                  | Amounts receivable                 | 219,527       | -            | 22,304      | 16,506        | -              | 258,337      
|                  | Prepaid expenses and deposits      | 52,606        | -            | 12,771      | 4,168         | -              | 69,545       
|                  | 1,037,363                          | 50,320        | 103,894      | 53,904      | 47,721        | 1,293,202     
|                  |                                    |               |              |             |               |                |              
|                  | Equity investment                  | 765,747       | -            | -           | -             | -              | 765,747      
|                  | Property, plant and equipment, net | 68,423        | 476,169      | 8694        | 27,525        | -              | 580,811      
|                  | Other assets                       | 5,583         | -            | -           | -             | -              | 5,583        
|Total Assets      | $ 1,877,116                        | $  526,489    | $  112,588   | $    81,429 | $      47,721 | $  2,645,343  

-137-  KISKA METALS CORPORATION  Notes to the Consolidated Financial Statements December 31, 2009, 2008 and 2007 (Expressed in Canadian Dollars)     18. OPERATING SEGMENTS (continued)  Revenues are derived from option receipts and the management of exploration programs for joint venture partners and are allocated to the jurisdiction based on where the underlying agreement and services were delivered. During 2009, four customers individually comprised 37% ($111,956), 33% ($99,871), 19% ($58,080) and 10% (28,566), respectively, of total revenues across all geographic segments. During 2008, four customers individually comprised 33% (300,000), 26% ($236,775), 20% ($182,421) and 13% ($116,229), respectively, of total revenues. During 2007, four customers represented 44% ($596,814), 19% ($262,753), 13% ($182,302) and 12% ($161,720), respectively, of total revenues.   Year endedYear endedYear ended200920082007RevenuesCanada$            170,036$            719,196$               779,115United States99,871--Australia3,144161,239424,516Mexico-16,880104,414Ireland--50,000$            273,051$            897,315$            1,358,045


|                                              |                                                  |                     |                     |                     |           |               |                    
|--------------------------------------------- | ------------------------------------------------ | ------------------- | ------------------- | ------------------- | --------- | ------------- | -------------------
|                                              |                                                  | Canada              | United States       | Australia           | Mexico    | Ireland       | Total              
|                                              |                                                  | (Restated 
Note 3) | (Restated 
Note 3) | (Restated 
Note 3) |           |               | (Restated 
Note 3)
|Net Loss for the year ended
December 31, 2009 | $(9,616,209)                                     | $(6,844,866)        | $(1,677,528)        | $(499,080)          | $(46,820) | $(18,684,503)
|Included in Net Loss                          |                                                  |                     |                     |                     |           |              
|                                              | Mineral property revenue                         | 170,036             | 99,871              | 3,144               | -         | -             | 273,051            
|                                              | Mineral property expenditure                     | (5,825,476)         | (6,361,696)         | (1,813,376)         | (347,406) | -             | (14,347,954)       
|                                              | Interest income                                  | 23,308              | 259                 | 2,585               | 31        | -             | 26,183             
|                                              | Loss on sale of marketable securities            | (240,285)           | -                   | -                   | -         | -             | (240,285)          
|                                              | Impairment loss on available for sale investment | (130,000)           | -                   | -                   | -         | -             | (130,000)          
|                                              | Future income tax recovery                       | 2,763               | -                   | -                   | -         | -             | 2,763              
|                                              | Equity loss in investment                        | (1,176,145)         | -                   | -                   | -         | -             | (1,176,145)        
|                                              | Depreciation and amortization                    | (25,809)            | (190,900)           | (15,021)            | (8,766)   | -             | (240,496)          
|                                              | Share-based compensation                         | (397,273)           | -                   | -                   | (27,243)  | -             | (424,516)          
|                                              | Foreign exchange gain/(loss)                     | 70,691              | (1,015)             | -                   | (916)     | -             | 68,760             

-138-  KISKA METALS CORPORATION  Notes to the Consolidated Financial Statements December 31, 2009, 2008 and 2007 (Expressed in Canadian Dollars)     18. OPERATING SEGMENTS (continued)


|                                              |                                       |              |               |              |             |                |            
|--------------------------------------------- | ------------------------------------- | ------------ | ------------- | ------------ | ----------- | -------------- | -----------
|                                              |                                       | Canada       | United States | Australia    | Mexico      | Ireland        | Total      
|                                              |                                       |              |               |              |             |                |            
|Net Loss for the year ended
December 31, 2008 | $ (8,561,353)                         | $(4,394,496) | $ (1,819,236) | $(1,440,493) | $(45,163)   | $ (16,260,741)
|Included in Net Loss                          |                                       |              |               |              |             |               
|                                              | Mineral property revenue              | 719,196      | -             | 161,239      | 16,880      | -              | 897,315    
|                                              | Mineral property expenditure          | (1,906,110)  | (4,407,266)   | -            | (1,050,862) | -              | (7,364,238)
|                                              | Interest income                       | 23,087       | 548           | 1,067        | -           | -              | 24,702     
|                                              | Loss on sale of marketable securities | (3,760)      | -             | -            | -           | -              | (3,760)    
|                                              | Future income tax recovery            | 1,094,579    | -             | -            | -           | -              | 1,094,579  
|                                              | Equity loss in investment             | (180,726)    | -             | (735,455)    | -           | -              | (916,181)  
|                                              | Financing expense                     | (3,565,047)  | -             | -            | -           | -              | (3,565,047)
|                                              | Gain on repayment of convertible loan | 279,859      | -             | -            | -           | -              | 279,859    
|                                              | Depreciation and amortization         | (55,939)     | (17,579)      | (159,596)    | (18,189)    | -              | (251,303)  
|                                              | Share-based compensation              | (76,461)     | -             | -            | -           | -              | (76,461)   
|                                              | Foreign exchange gain/(loss)          | (3,406,389)  | 12,951        | 225,348      | 30,023      | 7,520          | (3,130,547)




|                                              |                                       |              |               |              |             |                |             
|--------------------------------------------- | ------------------------------------- | ------------ | ------------- | ------------ | ----------- | -------------- | ------------
|                                              |                                       | Canada       | United States | Australia    | Mexico      | Ireland        | Total       
|                                              |                                       |              |               |              |             |                |             
|Net Loss for the year ended
December 31, 2007 | $ (5,844,463)                         | $(4,893,561) | $ (1,104,695) | $(2,660,184) | $  28,268   | $ (14,474,635)
|Included in Net Loss                          |                                       |              |               |              |             |               
|                                              | Mineral property revenue              | 779,115      | -             | 424,516      | 104,414     | 50,000         | 1,358,045   
|                                              | Mineral property expenditure          | (4,276,852)  | (4938,434)    | (412,424)    | (2,235,320) | -              | (11,863,030)
|                                              | Interest income                       | 380,870      | -             | 279          | -           | -              | 381,149     
|                                              | Loss on sale of marketable securities | -            | -             | 112,619      | -           | -              | 112,619     
|                                              | Future income tax recovery            | 1,583,244    | -             | (54,253)     | -           | -              | 1,528,991   
|                                              | Equity loss in investment             | -            | -             | (217,161)    | -           | -              | (217,161)   
|                                              | Financing expense                     | (2,353,130)  | -             | (6,770)      | -           | -              | (2,359,900) 
|                                              | Dilution gain                         | -            | -             | 1,646,124    | -           | -              | 1,646,124   
|                                              | Depreciation and amortization         | (59,759)     | (387)         | (134,991)    | (16,289)    | -              | (211,426)   
|                                              | Share-based compensation              | (761,482)    | -             | -            | -           | -              | (761,482)   
|                                              | Foreign exchange gain/(loss)          | 767,576      | 295,951       | 53,551       | 22,478      | (2,044)        | 1,137,511   

-139-  KISKA METALS CORPORATION  Notes to the Consolidated Financial Statements December 31, 2009, 2008 and 2007 (Expressed in Canadian Dollars)     19. DIFFERENCES BETWEEN GENERALLY ACCEPTED ACCOUNTING PRINCIPLES IN
       CANADA AND THE UNITED STATES  These financial statements have been prepared in accordance with Canadian generally accepted accounting principles (Canadian GAAP) which, with respect to the Company, differ in certain material respects from United States generally accepted accounting principles (U.S. GAAP).  The Financial Accounting Standards Board (FASB) has published the Accounting Standards Codification ("ASC") as the sole source of authoritative non-governmental U.S. GAAP.  The references to the standards reflect the new ASC, which is not intended to change U.S. GAAP but rather reorganize existing guidance by accounting topic to allow easier identification of applicable standards.  The following discussion focuses on material differences between Canadian GAAP and US GAAP which affect presentation of financial Information for the Company. The following tables summarize the differences in the consolidated statements of operations and the consolidated balance sheets:   Consolidated Statements of Operations200920082007(Restated  
Note 3)Net loss under Canadian GAAP$   (18,684,503)$   (16,260,741)$ (14,474,635)Mineral property acquisition costs330,598158,990198,500Impairment of mineral property acquisition costs(98,221)--Net mineral property interest acquisition costs (a)232,377158,990198,500Equity loss in investment (a)274,750--Future income tax recovery (b)-(1,063,300)(1,543,338)Deferred tax benefit (b)-52,29347,476507,127(852,017)(1,297,362Net loss under U.S. GAAP$   (18,177,376)$   (17,112,758)$ (15,771,997)Basic and diluted loss per share 
under U.S. GAAP$              (0.49)$              (1.94)$             (4.09)Comprehensive loss under Canadian GAAP$   (18,264,814)$   (16,905,127)$ (14,133,840)Net adjustments to consolidated statements of operations per above507,127(852,017)(1,297,362)Comprehensive loss under U.S. GAAP$   (17,757,687)$   (17,757,144)$  (15,431,202)  -140-  KISKA METALS CORPORATION  Notes to the Consolidated Financial Statements December 31, 2009, 2008 and 2007 (Expressed in Canadian Dollars)     19. DIFFERENCES BETWEEN GENERALLY ACCEPTED ACCOUNTING PRINCIPLES IN CANADA AND THE UNITED STATES (continued)   Consolidated Balance Sheets2009Canadian GAAPAdjustmentsU.S. GAAP(Restated  Note 3)Mineral property interests (a)$                       -$       884,973$         884,973Equity investment (a)-274,750274,750Share capital (b)65,659,0382,895,51668,554,554Deficit (a,b)(69,614,222)(1,735,793)(71,350,015)2008Mineral property interests (a)$                       -$     652,596$         652,596Share capital (b)50,048,0422,895,51652,943,558Deficit (a,b)(50,929,719)(2,242,920)(53,172,639)   Consolidated Statements of Cash Flows200920082007Cash Flows Used for Operating Activities under Canadian GAAP$  (8,330,700)$  (9,559,189)$  (16,154,566)Net mineral property interest acquisition costs (a)232,377158,990198,500Cash Flows Used for Operating Activities under U.S. GAAP$  (8,098,327)$  (9,400,199)$  (15,956,066)Cash Flows Used for Investing Activities
under Canadian GAAP$     (363,924)$    2,079,644$      1,986,611Net adjustments to consolidated statements of operations(232,377)(158,990)(198,500)Cash Flows Used for Investing Activities
under U.S. GAAP$     (596,301)$    1,920,654$     1,788,111   -141-  KISKA METALS CORPORATION  Notes to the Consolidated Financial Statements December 31, 2009, 2008 and 2007 (Expressed in Canadian Dollars)     19. DIFFERENCES BETWEEN GENERALLY ACCEPTED ACCOUNTING PRINCIPLES IN CANADA AND THE UNITED STATES (continued)  (a) Acquisition costs of mineral property interests The Company's accounting policy under Canadian GAAP is to expense the acquisition of mineral properties as incurred until there are identifiable reserves on a property, when they will be capitalized and amortized over production from the property. With the introduction of Emerging Issues Task Force (EITF) Abstract 04-2, effective April 30, 2004, now contained within ASC 930-805, mineral property acquisition costs are capitalized under U.S. GAAP, unless there is evidence that they are impaired and not recoverable, when they are written off. This difference has also been reflected in the equity loss in investment, as Clancy also expenses the acquisition costs of mineral property interests.  (b) Flow-through shares Under Canadian income tax legislation, the Company is permitted to issue shares whereby the Company agrees to incur qualifying expenditures and renounce the related income tax deductions to the investors. Under Canadian GAAP, the Company has recorded the full amount of the proceeds received on issuance as share capital.  Upon renouncing the income tax deductions, share capital is reduced by the amount of the future income tax benefits recognized.  Under U.S. GAAP, the recognition of this future income tax benefit is limited to the extent that the issue price of the flow-through shares exceeds the fair value of the Companys shares on the date that the flow-through shares are sold.  Impact of recently adopted United States accounting pronouncements:  ASC 805 Business Combinations (FAS141R)  This standard establishes principles and requirements for how the acquirer (1) recognizes and measures in its financial statements the identifiable assets acquired, the liabilities assumed and any non-controlling interest in the acquiree, (2) recognizes and measures the goodwill acquired in the business combination or a gain from a bargain purchase, and (3) determines what information to disclose to enable users of the financial statements to evaluate the nature and financial effects of the business combination.  This standard is to be applied prospectively to business combinations for which the acquisition date is on or after the beginning of the first reporting period after December 15, 2008.  This standard is consistent with the CICA Handbook Section 1582, Business Combinations, which the Company adopted during the year.   -142-  KISKA METALS CORPORATION  Notes to the Consolidated Financial Statements December 31, 2009, 2008 and 2007 (Expressed in Canadian Dollars)     19. DIFFERENCES BETWEEN GENERALLY ACCEPTED ACCOUNTING PRINCIPLES IN CANADA AND THE UNITED STATES (continued)  ASC 815 Derivatives and Hedging (FAS161)  This standard was issued in March 2008 and is effective for financial statements issued for fiscal years beginning after November 15, 2008, with early adoption encouraged.  The intent is to improve financial instruments standards for derivative instruments and hedging activities by requiring enhanced disclosures to enable investors to better understand their effects on an entitys financial position, financial performance, and cash flows. Since the Company does not apply hedge accounting and has no derivatives, the adoption of this standard has no material impact on the Companys financial statement presentation.  ASC 855 Subsequent Events (FAS165)  The standard sets out the period after the balance sheet date during which management should evaluate events that occur for potential recognition or disclosure in the financial statements. An entity should apply the requirements of this statement to interim and annual financial periods ending after June 15, 2009. The adoption of this standard has no material impact on the Companys financial statement presentation.  Accounting Standards Updates ("ASU")  ASU2010-06 Fair Value Measurements and Disclosures  The new disclosure requirements regarding inputs and valuation techniques for Level 2 fair value measurements are effective for interim and annual reporting periods beginning after December 15, 2009, and are consistent with IFRS 7 Financial Instruments: Disclosures. The Company uses Level 1 inputs (Quoted prices in active market) for determination of fair value of available-for-sale securities. The Company uses Level 2 inputs (significant observable inputs) to estimate the fair value of incentive stock options when determining compensation expense to be recognized. It is not anticipated that there will be a change in the nature of inputs or in the valuation techniques applied so there will be no material impact on the Company's financial statements. The Company is assessing the required disclosure to prepare for implementation for the first interim period of the fiscal year ending December 31, 2010.  ASU2010-02 Consolidation  This standard update addresses recognition of changes in a parents ownership interest in a subsidiary and is effective for interim and annual reporting periods beginning after December 15, 2009. The standard requires that all changes which occur while the parent retains its controlling financial interest in the subsidiary shall be accounted for as equity transactions with no gain or loss recognized in either consolidated net income or comprehensive income. The Company is assessing the impact of this update on the financial statements.   -143-  KISKA METALS CORPORATION  Notes to the Consolidated Financial Statements December 31, 2009, 2008 and 2007 (Expressed in Canadian Dollars)     20. COMPARATIVE AMOUNTS  The comparative amounts have been reclassified where necessary to conform to the presentation used in the current year.   21. SUBSEQUENT EVENTS  On February 22, 2010, the Company announced a non-brokered private placement of up to 9,000,000 units at a price of $0.66 per unit, for gross proceeds of up to $5.94 million. Each unit will consist of one common share and one-half of one non-transferable share purchase warrant. Each whole warrant entitles the holder to purchase, for a period of one year from the closing of the private placement (the "Closing"), one common share at a price of $0.92 per share. The warrants will contain a provision that will enable the Company to force exercise of the warrants if, during the term of any unexercised warrant commencing four months after the Closing, the common shares of the Company trade on any exchange for a period of 20 consecutive trading days at a price of $1.40 per share or greater. The funds raised will be used to further exploration of the Whistler Project and for general corporate purposes.  The first tranche of the placement closed on March 2, 2010. There were 6,720,000 common shares issued and 3,360,000 share purchase warrants, each of which permits the holder to purchase one common share at $0.92 before March 2, 2011. The shares are subject to a four-month hold period expiring on July 3, 2010. In addition, a cash commission of $114,840 was paid and 24,000 broker warrants were issued. The broker warrants have the same exercise provisions as the share purchase warrants. The value ascribed to the broker warrants in this tranche was $5,309 which was charged against share issue costs. Net cash proceeds from this placement were $4,320,360.  The second tranche of the placement closed on March 11, 2010. There were 2,372,500 common shares issued and 1,186,250 share purchase warrants, each of which permits the holder to purchase one common share at $0.92 before March 11, 2011. The shares are subject to a four-month hold period expiring on July 12, 2010. In addition, a cash commission of $73,458 was paid and 111,300 broker warrants were issued. The broker warrants have the same exercise provisions as the share purchase warrants. The value ascribed to the broker warrants in this tranche was $28,415 which was charged against share issue costs. The net cash proceeds from this placement were $1,492,392.         -144-  KISKA METALS CORPORATION  Notes to the Consolidated Financial Statements December 31, 2009, 2008 and 2007 (Expressed in Canadian Dollars)        KISKA METALS CORPORATION  (formerly Geoinformatics Exploration Inc.)   Managements Discussion and Analysis of Financial Results  AMENDED AND RESTATED  For the year ended December 31, 2009        -145-    KISKA METALS CORPORATION (formerly GEOINFORMATICS EXPLORATION INC.) MANAGEMENTS DISCUSSION AND ANALYSIS For the year ended December 31, 2009  This Managements Discussion and Analysis (MD&A) of financial position and results of Kiska Metals Corporation (formerly Geoinformatics Exploration Inc.) (the Company or Kiska) was revised subsequent to year end to conform to the restated audited consolidated financial statements and related notes for the year ended December 31, 2009. Refer to Note 3 in the financial statements for details of the restatement.  The Company re-evaluated the allocation of part of the purchase price for the acquisition of Rimfire Minerals Corporation to goodwill  The principal changes are to recognize an impairment loss of $7,817,788 as at September 30, 2009 to reduce the carrying value of the properties acquired as part of the acquisition of Rimfire Minerals Corporation to their estimated fair values. This resulted in an increase in the net loss for the year ended December 31, 2009 and for the quarter ended September 30, 2009. Reclassifications have been made to the consolidated balance sheets as at December 31, 2009 and the consolidated statements of operations and cash flows for the year ended December 31, 2009. Other information, not affected by the restatement, has not been updated.  This MD&A has been prepared based on information available to the Company April 10, 2010 and should be read in conjunction with the Companys audited consolidated financial statements and related notes for the year ended December 31, 2009. Readers are cautioned that the MD&A contains forward-looking statements and that actual events may vary from managements expectations. Readers are encouraged to read the Forward Looking Statement included with this MD&A The consolidated financial statements and MD&A are presented in Canadian dollars and have been prepared in accordance with Canadian generally accepted accounting principles (CDN GAAP).  About Kiska  Kiska is a mineral exploration company with a large portfolio of assets anchored by the Whistler Project, a multi-million ounce gold resource in Alaska. In addition to Alaska, the Company has additional propertiesin British Columbia, Mexico and Australia. The Company strives for the highest technical expertise in exploration combining an innovative targeting approach developed by the Company since inception with more traditional exploration methods. One of the unique aspects of the Companys approach is the use of probabilistic models to rank potential exploration drill targets. Kiska is listed on the TSX Venture Exchange, trading under the symbol KSK.  Over the past five years, the Company has evolved from a technology service company to a pure exploration company through its alliances with strategic partners within the mining and exploration industry. Over the past several years, the Company has acquired a large portfolio of exploration projects from its own exploration activities and under the Master Strategic Alliance Agreement (MSAA) with Kennecott Exploration Company (Kennecott).   -146-  KISKA METALS CORPORATION MANAGEMENTS DISCUSSION AND ANALYSIS For the year ended December 31, 2009   Effective August 5, 2009, Kiska acquired all of the outstanding shares of Rimfire Minerals Corporation (Rimfire). Under the agreement, the Company completed a 3 for 1 share consolidation and name change from Geoinformatics Exploration Inc. to Kiska Metals Corporation. The Company then acquired all of the issued and outstanding shares of Rimfire at an agreed exchange ratio of 0.87 Kiska shares for each Rimfire share. The transaction was completed by way of a statutory plan of arrangement following the approval of shareholders from Kiska and Rimfire. The shareholder meetings were held on July 30, 2009 with shareholders of each company voting overwhelmingly to approve the Transaction. Rimfire management and staff have been integrated into the Company. The Company expects there will be synergies in exploration in those areas where Geoinformatics and Rimfire were both active, and a reduction of overhead costs.  1.2  Overview  During the first half of 2009, the Company focused on corporate opportunities in order to secure future funding for the Company to ensure the advancement of its key projects. Following the acquisition of Rimfire, Toronto office functions were moved to a combined Kiska-Rimfire office in Vancouver under the direction of the newly appointed management team. This consolidation has resulted in significant savings and efficiencies. This trend is expected to continue in future months.  Kiskas technical staff has examined each project in the combined portfolio to determine the best way to derive value from the portfolio of exploration properties. Shareholder value will be optimized through strategic partnerships, option/joint ventures and property dispositions. The final decision on most of the projects depends on results of data compilation from site visits and technical reviews. During the fourth quarter, the Company entered into discussions with potential joint venture partners for some of the properties and prepared plans for advancing other projects.  During the summer of 2009, the Company commenced an exploration program on the Whistler project located approximately 160 kilometres northwest of Anchorage. The exploration program consisted of 275 line-kilometres of Induced Polarization (IP) geophysical surveys of which 235 line-kilometres being carried out in a three-dimensional array. In conjunction with the geophysical surveys, surface geological mapping and sampling of the grid were completed. Additional targets on the property were evaluated to define drill targets. The first phase of a helicopter supported drill program was completed and the second phase commenced in March 2010. This drill program will test a combination of geophysical targets defined by the IP survey and targets defined by the surface work program and earlier drill program.     KISKA METALS CORPORATION MANAGEMENTS DISCUSSION AND ANALYSIS For the year ended December 31, 2009   On September 16, 2009, the Company completed a brokered private placement consisting of 9,000,000 units at $0.55 for gross proceeds of $4,950,000. Each unit consisted of one common share and one half of one non-transferable share purchase warrant. Each whole warrant entitles the holder to purchase one common share at a price of $0.80 per share until March 16, 2011. The terms of the warrants provide that if, during the term of any unexercised warrant commencing on January 17, 2010, the closing price of the common shares of the Company on any exchange is greater than $1.10 for a period of 20 consecutive trading days the Company may, at its option and by notice in writing to each holder, require the holder of the warrant to exercise such warrant within 30 days, failing which the warrant will be deemed to have expired. The units issued under the offering are subject to a four-month hold period expiring on January 17, 2010.  The funds from this placement will be utilized to continue the exploration of the Whistler project and for general corporate purposes.  1.3  Selected Annual Performance  2009
(restated)20082007Mineral Property Revenues$  273,051$    897,315$    1,358,045Net Income (Loss)(18,684,503)(16,260,741)(14,474,635)Per Share(0.51)(1.84)(3.73)Total assets2,327,8952,645,3439,655,372Long-Term Liabilities401,391-16,914,189Shareholders Equity (deficit)1,641,7532,004,272(8,922,640)Cash dividends declaredNILNILNIL  Restatement  Based on further analysis and review subsequent to April 26, 2010, the Company has concluded that that the characterization of $7,817,788 as goodwill was inappropriate under Canadian GAAP. The Company has determined that the appropriate method of accounting for the events which occurred after the completion of the acquisition transaction, including the change in the board and management, and the detailed review of the Companys properties and operations, is on a prospective basis. The consolidated financial statements have therefore been restated to present the $7,817,788, that was previously presented as Goodwill, as a cost of the acquired mineral properties of Rimfire Minerals Corporation consistent with the allocation disclosed in the information circular. In accordance with the Companys accounting policy for mineral properties, these costs were then expensed in the period in which they were incurred.   -148-  KISKA METALS CORPORATION MANAGEMENTS DISCUSSION AND ANALYSIS For the year ended December 31, 2009   1.4  Results of Operations Exploration Projects Alaska Whistler Project  As part of the amended Kennecott Agreement negotiated in June 2009, the Company agreed to complete a specified work program with defined amounts of geophysics and drilling on several targets within the Whistler project area. Once the full program is completed, Kennecott will decide whether to exercise its right to back in or relinquish back-in rights and revert to a royalty. The program will consist of:  - Up to 341 line kilometers of 2D and 3D Induced Polarization geophysics on regional targets. - Drilling of a minimum of 20 holes with a minimum depth of 200m per hole, for at least 7000m in aggregate.  The work program will be supervised by a technical committee comprised of two geoscientists from each of Kiska and Kennecott.  Upon completion of the program and presentation of a report, Kennecott must either elect to: Within 90 days, relinquish its back-in right and revert to a 2% NSR, or - Within 90 days, exercise its back-in right on the project to earn an initial 51% interest by refunding two times Geoinformatics' total qualifying exploration expenditures. Kennecott may then elect to increase its interest to 60% by funding all programs and budgets until the project reaches a development decision, or - Within 30 days, agree to fund a supplemental exploration drill program. Within 30 days of receiving the results from the completed supplemental program, Kennecott must make a final decision on whether to exercise or relinquish its back-in rights as described above. If Kennecott elects to back in after the supplemental program, Kennecott can offset the costs of the supplemental program to a maximum of 6% of two times Geoinformatics' total exploration costs. The supplemental program shall not exceed 180 days.  On August 6, 2009 Kiska commenced a regional Induced Polarization (IP) geophysical survey totaling 341 line kilometres. The program involved geophysical crews from Aurora Geosciences (Alaska) Ltd. of Anchorage and SJ Geophysics of Vancouver and used a combination of 2D and 3D IP techniques. The 2D portion of the IP survey was completed on September 24th 2009. The 3D portion of the survey was approximately 78% complete in early November when it was terminated due to frozen ground conditions. The survey will be used to further refine targets in thin gravel-covered areas to prioritize targets for drilling as part of agreed program during 2010.  A five hole diamond drill program totaling approximately 1500 metres was completed at Whistler during the third quarter as part of the agreed program. Five targets were tested.  -149-  KISKA METALS CORPORATION MANAGEMENTS DISCUSSION AND ANALYSIS For the year ended December 31, 2009   Alaska Whistler Project (continued)  · Lightning - outcropping quartz veins hosted by diorite porphyry located approximately 0.9 kilometers southwest of the Whistler Deposit. No significant results were returned from this hole (WH09-001). · Raintree West - follow-up on the 2008 discovery where the only hole to-date returned 160 metres averaging 0.59g/t gold, 6.02g/t silver, 0.10% copper including 24 meters averaging 1.37g/t gold, 6.32g/t silver and 0.13% copper located 1.5 kilometres east of the Whistler Deposit. One hole drilled at this target in 2009 (WH09-002) returned a 471.6 meter intersection that averaged 0.38g/t gold, 4.7g/t silver, 0.09% copper, 0.15% lead, and 0.35% zinc (0.93g/t gold-equivalent). The hole ends in mineralization and this intersection represents the entire length of the hole · Digger - a magnetic anomaly approximately 500 meters in diameter with no outcrop exposure located approximately 3.5 kilometres southeast of the Whistler Deposit. Soil sampling results at Digger returned anomalous results comparable to soil sampling over the Whistler Deposit. No significant results were returned from this hole (WH09-003). · Island Mountain Breccia - a 150 meter diameter intrusive breccia body hosted by diorite porphyry located approximately 23.5 kilometers southwest of the Whistler Deposit.  The first and only hole in this target (IM09-001) returned 0.68 g/t gold over 382.9 meters, including an upper copper and silver-bearing interval and a lower gold-only intersection. The upper interval of 150.0 metres in drilled length averaged 0.72 g/t gold, 2.37 g/t silver and 0.16% copper (1.06 g/t gold equivalent). A second interval averaged 1.22 g/t gold, 0.69 g/t silver and 0.05% copper over the bottom 106.9 metres of the drill hole · Island Mountain Cirque - an extensive outcrop of gossanous monzonite porphyry located approximately 22 kilometers southwest of the Whistler Deposit. Hole IM09-002 was drilled to test this target returning 0.13 g/t gold over 202.3 metres. Although anomalous in gold over its entire length, the hole was lost due to technical reasons prior to reaching target depth  A further 15 holes are planned to test regional targets as part of the current spring 2010 program and will be targeted on the basis of the Induced Polarization geophysical survey as well as geological mapping, geochemistry and previously collected airborne magnetic data. Including the completed drilling, a total of 7,000 metres in at least 20 drill holes is planned for completion by mid-2010.  The IP and drill program constitute the entire work program required for Kennecott Exploration to make a decision regarding its back-in rights on the project.  The mineral resource model presented in the technical report prepared by SRK Consulting Canada Inc. and filed on SEDAR on February 22, 2008 represents the first resource evaluation for the Whistler copper-gold deposit. This initial mineral resource model was prepared to provide an initial assessment of copper and gold sulphide zones delineated by drilling on this project and to provide management an independent assessment to justify additional exploration and development work. The resource estimate was completed by George H. Wahl, P.Geo an independent qualified person as this term is defined in National Instrument 43-101. The effective date of this resource estimate is December 31, 2007.   -150-  KISKA METALS CORPORATION MANAGEMENTS DISCUSSION AND ANALYSIS For the year ended December 31, 2009   Alaska Whistler Project (continued)  Mineral Resource Statement for the Whistler Gold Deposit, Alaska Prepared by SRK Consulting (Canada) Inc. December 31, 2007


|                        |                   |                       |              |            |             |            |              |              |              
|----------------------- | ----------------- | --------------------- | ------------ | ---------- | ----------- | ---------- | ------------ | ------------ | -------------
|                        | Tonnes and Grades | Total Contained Metal
|Resource Category       | Tonnage (Mt)      | Gold (g/t)            | Silver (g/t) | Copper (%) | Gold Eq3g/t | Gold (Moz) | Silver (Moz) | Copper (Mlb) | Gold Eq3(Moz)
|Indicated (open-pit1)   | 30                | 0.87                  | 2.46         | 0.24       | 1.35        | 0.84       | 2.37         | 159          | 1.31         
|Total Indicated         | 30                | 0.87                  | 2.46         | 0.24       | 1.35        | 0.84       | 2.37         | 159          | 1.31         
|Inferred (open-pit1)    | 123               | 0.59                  | 2.07         | 0.19       | 0.98        | 2.33       | 8.19         | 515          | 3.86         
|Inferred (underground2) | 11                | 1.16                  | 3.55         | 0.24       | 1.66        | 0.41       | 1.26         | 58           | 0.59         
|Total Inferred4         | 134               | 0.64                  | 2.18         | 0.20       | 1.05        | 2.74       | 9.44         | 573          | 4.44         

1. Reported within a conceptual pit shell and based at a cut-off grade of 0.3 g/t gold equivalent adjusted for metallurgical recovery. 2. Reported based on an underground bulk mining method using a cut-off grade of 1.1 g/t gold equivalent adjusted for metallurgical recovery; 3. Gold equivalent grade estimated based on 75 percent recovery for gold and silver; 85 percent recovery for copper; US$550 per ounce gold, US$8 per ounce silver and US$1.50 per pound of copper; 4. Totals may vary due to rounding.  The SRK technical report and NI 43-101 resource estimate statements on the Whistler Project are available on SEDAR at www.sedar.com under the Kiska Metals Corporation filing profile. The Qualified Person for this project is Mark Baknes, P.Geo, Vice President Exploration for the Company.  Uncle Sam Project  The Uncle Sam Gold Project is an intrusion-related gold target, located approximately 76 kilometres southeast of Fairbanks, hosted in a similar age of rocks to those which host the Pogo Gold Mine in east-central Alaska approximately 60 kilometres away. The Pogo Mine was discovered in the mid 1990s and hosts over 5 million ounces of gold. The Uncle Sam project consists of extensive anomalous surface gold geochemistry highlighted by a drill intersection of 10.6 metres averaging 6.1g/t gold.  On November 2, the Company signed an option agreement with Millrock Resources Inc. (Millrock) giving Millrock the option to earn a 100% interest in the Uncle Sam property in Alaska. Under the terms of the agreement Millrock will make cash payments totaling US$200,000 over four years with US$40,000 being paid upon TSX approval. In addition, Millrock will issue 1,000,000 shares to Kiska over four years and has made a commitment to spend US$2,700,000 on exploration over four years. There is an underlying 2% NSR payable to International Royalty Corporation.   -151-  KISKA METALS CORPORATION MANAGEMENTS DISCUSSION AND ANALYSIS For the year ended December 31, 2009   Alaska Goodpaster Properties  The Goodpaster Properties, located 65 kilometres northeast of Delta Junction, Alaska consist of four claim groups totaling 183,920 acres (74,430 hectares). Rubicon Minerals Corporation (Rubicon) has an option agreement to explore the properties. Rubicon will fund a total of USD$4.8 million in exploration over 6 years to earn a 60% interest in the Alaska properties. Upon vesting, they may obtain a further 10% interest in the properties by completing a feasibility study, and at the Companys election, may obtain an additional 5% (for a total of 75% interest) by providing a project financing loan to be repaid from the Companys free cash flow upon production.  The ER-Ogo-Fire and portions of the Eagle-Hawk claim groups are subject to a 2% NSR in favour of AngloGold Ashanti (U.S.A.) Exploration Inc. Portions of the California-Surf are subject to a 1.75% NSR in favour of Capstone Mining Corp. Bou-Swede is wholly owned by Rimfire Alaska, Ltd., a wholly-owned subsidiary of the Company.  As operator Rubicon completed a US $750,000 program in 2008 that included property-wide reconnaissance exploration including geological mapping, prospecting and soil sampling with limited drilling on the ER-Ogo-Fire property. Drilling targeted new mineralization found approximately 300 metres northwest of an area drilled in 2003 and 2004 by then-partner AngloGold Ashanti. Three holes, totaling 300 metres, were completed to test this mineralization. Rubicon has not conducted an exploration program for these properties in 2009.  Australia Lachlan Fold Belt Properties  The Company holds two exploration licences covering 27,513 hectares in the Lachlan Fold Belt, New South Wales, Australia. The Lachlan Fold Belt is richly endowed with a diversity of deposit types that host in excess of 150 million ounces of gold. Deposit types include copper gold porphyry, epithermal gold, volcanogenic massive sulphide (VMS), gold-copper skarn, sediment-hosted disseminated gold and intrusion-related gold deposits.  Effective December 12, 2008, the Company signed a Farm-in agreement for the Barmedman exploration licence with Inmet Mining (Australia) Pty. Ltd. Under the terms of the agreement, Inmet can earn a 60% interest by funding at least A$5 million in exploration on the property over four years, including A$400,000 in the first year. Inmet will make staged cash payments totalling A$250,000 over the earn-in period.  In the first quarter of 2009, the Company completed a soil sampling survey and diamond drilling program on the Barmedman exploration licence, targeting IP anomalies and Mobile Metal Ion (MMI) geochemical anomalies identified during the 2008 exploration program. This program, operated by the Company, had a total budget of A$400,000 and was funded 100% by Inmet. The program consisted of eight line-kilometres of partial leach soil geochemistry over the IP anomaly. Partial leach geochemistry is a specialized geochemical method utilized to detect buried mineralization under transported cover. The diamond drilling program consisted of five diamond drill holes for a total of 1508 metres. Drilling targeted coincident IP and partial leach geochemical anomalies.  -152-  KISKA METALS CORPORATION MANAGEMENTS DISCUSSION AND ANALYSIS For the year ended December 31, 2009   Australia Lachlan Fold Belt Properties (continued)  Additional geochemical soil surveys, funded by Inmet, were completed in late November and December to expand on the work programs conducted earlier in the year. The program targeted two new areas of anomalous copper geochemistry. Both target areas were identified via partial leach geochemical analyses. A drill program started in early March consisting of approximately 900 metres of aircore/diamond drilling in three holesto target the copper geochemical anomalies. Victoria Goldfields Properties  Effective July 28th 2008, the Company entered into a new exploration partnership with Northgate Minerals Corporation, which granted the Company an option on its Stawell Corridor gold exploration properties in the State of Victoria, Australia. The Company will be exploring three licences, Murtoa, Ararat South and Dundonnell, totaling 120 km of the corridor length, representing all ground outside of a 50 km buffer around the Stawell Gold Mine. In addition to greenfields opportunities, more advanced targets exist including the 10 kilometre-long Murtoa target, which surrounds the Kewell gold resource.  The Stawell Corridor is a 240 km long belt bound by the Congee and Moyston faults and is anchored by Northgate's five million ounce Stawell Gold Mine (20 Mt at 8 g/t gold). Mineralization at Stawell consists of gold-bearing quartz veins in iron-rich sediments associated with basalt centres. This deposit has been studied extensively, resulting in the identification of large-scale characteristics that can be used in the exploration for similar deposits elsewhere in the district. Geophysical techniques such as gravity and magnetics surveys have proven effective in targeting basalt centres associated with mineralization. These techniques will be important in evaluating the rest of the Stawell Corridor and refining targets for drilling.  British Columbia and Yukon Projects  The Company controls an extensive property portfolio in British Columbia and the Yukon. Projects include:  • Boulevard Property, consisting of 238 claims, is located approximately 135 kilometres south of Dawson City, Yukon. Silver Quest Resources Ltd. (Silver Quest) can acquire the Companys 40% interest in the property by making staged cash payments totaling $80,000, issuing an aggregate of 400,000 shares and completing exploration expenditures of $3,000,000 over a five year period. Northgate receives the other 60% of the property payments. The Company retains a 1% net smelter royalty (NSR) on the property, with Silver Quest having the right to buyback 0.5% of the NSR for $375,000.   -153-  KISKA METALS CORPORATION MANAGEMENTS DISCUSSION AND ANALYSIS For the year ended December 31, 2009   British Columbia and Yukon Projects (continued)  • Gillis Property, covering 6,182 hectares, is located in the Nicola Mining Division of British Columbia, approximately 30 kilometres southwest of Merritt. The Company signed an option agreement effective September 5, 2008 to earn a 100% interest in the property by funding a total of $300,000 in exploration and making cash payments totalling $165,000 by the third anniversary. The vendor will also be paid 2.5% of annual exploration expenditures until a positive decision to mine. Upon a public announcement by the Company of a NI 43-101 compliant gold resource of at least 500,000 oz, the Company will issue 217,500 shares to the vendors.  • Grizzly Property, covering 2,652 hectares, is located in the Liard Mining Division of British Columbia, approximately 50 kilometres east of the Galore Creek project and within four kilometres of the partially completed Galore Creek access road. The Company owns a 100% interest in these claims, subject to an underlying 2% NSR, 100% of which can be purchased for $2 million.  • Kliyul Property, covering 3,656 hectares, is located in the Omineca Mining Division of British Columbia, approximately 115 kilometres north of Takla Landing. The Company has a 30% interest in the Kliyul property in a joint venture with Kennecott holding 45% and Daylight Energy Ltd. holding the remaining 25%.  • Poker Creek Property, covering 2,516 hectares, is located in the Liard Mining Division of British Columbia, approximately 16 kilometres west of Telegraph Creek. The Company owns 100% of these claims.  • RDN Property, covering approximately 8,576 hectares, is located in the Liard Mining Division of British Columbia, approximately 120 kilometres northwest of Stewart, British Columbia. This property is currently optioned to Northgate Minerals Corporation, subject to an underlying NSR. On February 21, 2007, the Company signed an amendment suspending the terms of the Joint Venture Option agreement until such time as the Galore Creek road access is constructed across the RDN property.  • Redton Project is located in the Quesnel Trough in northern British Columbia. The project adjoins the Kwanika property and is within 1,500 metres of the recent discovery made by Serengeti Resources Inc. on the Kwanika property Kiska has earned an 85% interest, subject to underlying royalties, in the project by spending in excess of $4.75 million. Redton Resources Inc. holds the other 15% interest.   -154-  KISKA METALS CORPORATION MANAGEMENTS DISCUSSION AND ANALYSIS For the year ended December 31, 2009   British Columbia and Yukon Projects (continued)  • Quesnel Trough Project, covering 34,570 hectares, is located in the Cariboo Mining Division of British Columbia. A total of seven properties comprise the project and are located from 15 kilometres south of Prince George to 40 kilometres north of Fort St. James. The Company owns 100% of these claims. Xstrata Canada Corporation signed an option agreement to earn a 51% interest in the property by completing a preliminary assessment and spending $3,000,000 by December 31, 2013. In addition, Xstrata must spend no less than $250,000 in each calendar year commencing in 2010. Xstrata may earn an additional 24% (total 75%) by completing a feasibility study and incurring no less than $20 million in feasibility study expenditures which must be completed before the tenth anniversary of Xstrata earning its 51% interest. Xstrata completed MMI soil geochemical surveys on the properties in 2009. Follow up work is expected to be undertaken in 2010.  • Thorn property, covering 14,689 hectares is located in the Atlin Mining Division of British Columbia, approximately 120 kilometres northwest of Telegraph Creek. The Company owns 100% of this property subject to payments to Cangold Limited in the event a third party partner becomes involved and an underlying NSR. The Company engaged Mira Geosciences Ltd. to complete 3-D modeling of the airborne geophysical data and ground Induced Polarization data to generate targets similar to the geophysical signature of known mineralization on the property.  • Tide Property, covering 2,964 hectares, is located in the Skeena Mining Division of British Columbia, approximately 36 kilometres north of Stewart, British Columbia. American Creek Resources Ltd. has earned 51% of the project. American Creek can earn an additional 9% interest by funding a further $3.5 million in exploration on or before December 31, 2010. Their interest can be increased to 65% interest by funding a bankable feasibility study, and, at the Companys election, to a 70% interest by providing 100% of the initial project development financing. American Creek is operator and did not conduct exploration on the property in 2009.  • Wernecke Breccia Project, consisting of 1926 claims, is situated in the Wernecke Mountains approximately 180 kilometers northeast of Mayo in east-central Yukon Territory. During 2007, the field program focused on a series of high priority drill targets designed to test iron-oxide-copper-gold systems +/- uranium and stand alone uranium targets, all of which are characterized by coincident geophysical, geological and geochemical anomalies. Many of these targets were newly defined in 2006, while some were historical targets that remain open for expansion. No exploration was undertaken in 2009. Fronteer, who owns 80% of the project, and the Company will be seeking joint venture partners to continue exploration of the property.  • Williams Property, covering 26,136 hectares, is located in the Liard Mining Division of British Columbia, approximately 150 kilometres southeast of Dease Lake, British Columbia and 330 kilometres north of Smithers. The Company owns 100% of the property subject to underlying royalties and is actively seeking a joint venture partner for the Williams Property.   -155-  KISKA METALS CORPORATION MANAGEMENTS DISCUSSION AND ANALYSIS For the year ended December 31, 2009   Mexico  The company held an interest in fifteen projects in Sonora, Durango and Sinaloa States in Mexico. Twelve projects were held in a 60/40 Joint Venture with Azure Minerals Limited (60%).  All projects were subject to certain back in rights held by Minera Kennecott S.A. de C.V., (MKE) a subsidiary of Rio Tinto. Subsequent to year end, the Joint Venture was terminated and MKE relinquished its back in rights on all projects. The Company now holds 100% interest in nine projects each of which is subject to a 2% NSR held by MKE including six of the former joint venture properties.  The majority of the projects have been targeted for their porphyry coppergoldmolybdenum potential, while some projects show potential for epithermal goldsilverbase metal mineralization. The projects span a range from grassroots to exploration drilling levels of advancement.  The Company conducted property examinations of all the Mexican projects in October to assess the potential for development and to determine the next steps in deriving value from each project in the future.  Nevada and New Mexico Properties  The Company controls three projects which include:  • Colorback Property, consisting of 202 claims, located in Lander County, Nevada approximately 100 kilometers southwest of Elko.  • Hilltop Property, consisting of 82 claims, located in Lander County, Nevada approximately 100 kilometers southwest of Elko.  • San Juan Property,consisting of 51 claims and 5 state mining leases, located in Socorro County, New Mexico approximately 42 kilometers southwest of San Antonio. The San Juan claims contain gold-molybdenum-silver targets that are untested by drilling.   -156-  KISKA METALS CORPORATION MANAGEMENTS DISCUSSION AND ANALYSIS For the year ended December 31, 2009   Expenditures for the year ended December 31, 2009 are summarized in the following table: (all amounts in Canadian dollars)


|                                      |                   |                      |                       |             |                     |                 
|------------------------------------- | ----------------- | -------------------- | --------------------- | ----------- | ------------------- | ----------------
|                                      | Alaska
(restated) | Australia
(restated) | BC & Yukon
(restated) | Mexico      | Nevada & New Mexico | Total
(restated)
|Acquisition costs                     | $     816,834     | $ 1,798,632          | $ 5,527,714           | $     4,929 | $        277        | $  8,148,386    
|                                      |                   |                      |                       |             |                     |                 
|Exploration costs                     |                   |                      |                       |             |                     |                 
|Aircraft and helicopter               | 1,733,842         | -                    | 5,397                 | -           | -                   | 1,739,239       
|Camp and support                      | 331,085           | 1,770                | 5,692                 | 14,848      | 1,087               | 354,482         
|Chemical analysis                     | 26,244            | 247                  | 5,502                 | 17,235      | 730                 | 49,958          
|Data management and maps              | 308               | 30                   | 610                   | 6,008       | 23                  | 6,979           
|Drilling & trenching                  | 291,603           | -                    | -                     | -           | -                   | 291,603         
|Geological and engineering            | 774,182           | 10,415               | 96,715                | 158,453     | 18,523              | 1,058,288       
|Geophysical surveying                 | 1,403,373         | -                    | 19,182                | -           | -                   | 1,422,555       
|Materials and supplies                | 205,648           | 635                  | 971                   | 3,337       | 1,704               | 212,295         
|Project management                    | 9,490             | -                    | 65,149                | -           | -                   | 74,639          
|Reclamation expense                   | -                 | -                    | 5,769                 | -           | 3,835               | 9,604           
|Recording and filing                  | 273,887           | -                    | 75,349                | 129,601     | 49,350              | 528,187         
|Travel                                | 93,526            | 1,647                | 1,603                 | 8,563       | 369                 | 105,708         
|                                      | 5,143,188         | 14,744               | 281,939               | 338,045     | 75,621              | 5,853,537       
|                                      |                   |                      |                       |             |                     |                 
|Exploration tax credits               | -                 | -                    | (9,798)               | -           | -                   | (9,798)         
|Joint venture payments                | -                 | -                    | -                     | -           | -                   | -               
|Reclamation obligation                | 306,746           | -                    | 25,622                | 4,432       | 19,029              | 355,829         
|                                      | 5,449,934         | 14,744               | 297,763               | 342,477     | 94,650              | 6,199,568       
|                                      |                   |                      |                       |             |                     |                 
|Total Acquisition & Exploration Costs | 6,266,768         | 1,813,376            | 5,825,477             | 347,406     | 94,927              | 14,347,954      
|Option proceeds                       | (99,871)          | -                    | (58,080)              | -           | -                   | (157,951)       
|Net Expenditures                      | $ 6,166,897       | $ 1,813,376          | $ 5,767,397           | $ 347,406   | $    94,927         | $ 14,190,003    

-157-  KISKA METALS CORPORATION MANAGEMENTS DISCUSSION AND ANALYSIS For the year ended December 31, 2009   Financial Results  For the year ended December 31, 2009 Kiska incurred a net loss of $18,684,503 ($0.51 per share) compared to a net loss of $16,260,741 ($1.84 per share) in the previous year, after taking into account the three for one share consolidation. The most significant factor contributing to the net loss is the mineral property acquisition costs associated with the acquisition of Rimfire Minerals Corporation. These costs were expensed during the year increasing the net loss by $7,974,288. Mineral property revenues decreased by 70% from $897,315 to $273,051 while interest revenue remained steady at $26,138 compared to $24,702. Exploration expenditures decreased by 12% ($6,530,166) from the previous year ($7,364,238). In the first half of the year, strenuous efforts were made to limit exploration to strategic initiatives in order to conserve cash. General and administrative expenses were reduced by 50% from the previous year, primarily related to the repayment of debt with significant reductions in financing expense.  For the three months ended December 31, 2009, the Company incurred a net loss of $3,369,393 ($0.06 per share) compared with a net loss of $5,131,640 (or $0.25 per share) for the three months ended December 31, 2008. There was a significant increase in exploration expenditures during the third and fourth quarters of 2009 as exploration programs commenced on the Whistler project. During the same period of 2008, the Company was completing drill programs on both the Whistler and Redton properties.  Mineral property revenues decreased in the current year ($273,051) compared to the previous year ($897,315) as the Company concentrated on exploration of the Whistler property rather than managing exploration programs for other companies. In the first half of the year, management was seeking an agreement for the Company as a whole instead of negotiating joint venture and option agreements for individual properties. The process of disposition of mineral properties was commenced in the second half of the year resulting in recognition of option proceeds.  The most significant change in general and administrative expense is financing expense. During the year ended December 31, 2009 all remaining debt was paid off resulting in total financing expense of $59,660 compared to the previous year figure of $3,565,047. The other significant changes were in salaries which were reduced from $1,615,644 in 2008 to $680,828 in 2009 and outsourced services which increased from $507,815 in 2008 to $1,073,104. Most of the increase in outsourced services relates to the corporate acquisition costs associated with the acquisition of Rimfire Minerals Corporation in August 2009. This is not expected to be a recurring cost.  Exploration expenditures, excluding those by joint-venture partners, totaled $5,853,537 ($7,204,248), and property acquisition expenditures totaled $8,148,386 ($158,990). These costs were offset by exploration tax credits totaling $9,798 ($Nil). The majority of the exploration expenditures were made on the Whistler property in Alaska.  At the acquisition date, the mineral properties acquired from Rimfire Minerals were valued at $7,974,288. These costs were expensed in accordance with the Companys accounting policies.  At the end of the fiscal year, reclamation obligations for active properties were estimated and an expense of $355,829 was included in mineral property expenditures.   -158-  KISKA METALS CORPORATION MANAGEMENTS DISCUSSION AND ANALYSIS For the year ended December 31, 2009   The British Columbia Mineral Exploration Tax Credit Program will reimburse the Corporation for 20% of eligible expenditures in that jurisdiction. For the fiscal year ended December 31, 2009 exploration tax credits are $9,798. The severity of the Mountain Pine Beetle infestation in British Columbia has resulted in designation of an area where the tax credit will be 30% rather than the previous 20%. Most of the Companys active mineral properties fall within the designated zone.  1.5  Summary of Quarterly Results  Selected quarterly information for each of the eight most recently completed financial periods isset out below: (figures in thousands)


|                      |             |                    |               |               |             |            |             |            
|--------------------- | ----------- | ------------------ | ------------- | ------------- | ----------- | ---------- | ----------- | -----------
|                      | Q4
2009     | Q3
2009
(restated) | Q2
2009       | Q1
2009       | Q4
2008     | Q3
2008    | Q2
2008     | Q1
2008    
|Revenues              | $       205 | $         68       | $           - | $           - | $       542 | $       20 | $       249 | $        86
|Loss from operations  | (3,234)     | (12,353)           | (817)         | (728)         | (1,645)     | (3,948)    | (1,717)     | (2,734)    
|Net loss              | (3,369)     | (12,226)           | (1,618)       | (1,221)       | (5,152)     | (5,924)    | (2,718)     | (2487)     
|Loss per common share | $   (0.07)  | $   (0.31)         | $   (0.06)    | $   (0.05)    | $   (0.25)  | $   (0.45) | $   (0.60)  | $   (0.54) 

Expenditures generally exhibit a seasonal variation being lower in the first and last quarters and higher during the second and third quarters of each year. This variation is due to the climate where exploration is taking place, which restricts exploration to the summer months.  1.6  Liquidity  The Companys cash and cash equivalents balance at December 31, 2009 was $1,071,695 compared with $762,560 at December 31, 2008. The cash and cash equivalents were comprised of term deposits and cash as in the previous year. In addition, the Company has restricted cash of $202,707 (2008-$82,228) representing reclamation and performance deposits for mineral properties. The Company had working capital of $1,563,862 at December 31, 2009 compared with working capital of $652,131 at December 31, 2008. The increase in working capital is attributable to the acquisition of Rimfire Minerals and completion of a brokered private placement during the third quarter of 2009.  During the year, cash used in operating activities was $8,330,702 (2008-$9,559,189, 2007-$16,154,566). This reflects the emphasis on exploration activity subsequent to the corporate acquisition and the acquisition expenses which totaled $633,875. Non-cash costs associated with the acquisition were primarily the exchange of Kiska shares for Rimfire shares and the conversion of existing employee stock options to new stock options.  The Company increased cash resources by $90,099 from the sale of marketable securities received as mineral property option proceeds. The Corporation issued 9,000,000 shares for cash proceeds of $4,950,000 pursuant to a brokered private placement. An additional 140,827 shares were issued upon exercise of options for proceeds of $59,747. Total share issue costs were $438,496. As of December 31, 2009, consolidated cash amounted to $1,071,695, an increase of $309,135 from the beginning of the year.  -159-  KISKA METALS CORPORATION MANAGEMENTS DISCUSSION AND ANALYSIS For the year ended December 31, 2009   1.6  Liquidity (continued)  The Companys financial instruments are all fully cashable at any time so there are no restrictions on availability of funds. There is no long-term debt. The Companys current obligations include lease commitments for office space. The lease expires November 30, 2010. Lease commitments for the remainder of the current fiscal year total $95.555. The other current obligations are statutory withholding and payroll taxes.  1.7  Capital Resources  The Companys number of issued and outstanding shares was 56,741,361 at December 31, 2009. The one for three consolidation and issue of 22,365,258 shares to Rimfire shareholders, effective August 5, 2009, as part of the corporate acquisition accounts for most of the difference from 25,235,276 common shares that were issued and outstanding at the previous fiscal year-end. During the year, 3,353,328 employee stock options were granted at a weighted average strike price of $0.65 and 1,520,896 options expired or were forfeited. 140,827 options were exercised at a weighted average price of $0.42. At the end of the year, the balance of options outstanding is 4,383,844 with expiry dates up to December 2014.  The Company acquired 100% of Rimfire by issuing 22,365,258 common shares and issuing 1,905,300 options to purchase common shares, for an aggregate fair value of $12,786,175. The fair value of the common shares, amounting to $12,412,717, was based on the bid price of the common shares on the date of acquisition, and the fair value of the options issued, amounting to $373,458, was determined using the Black-Scholes option pricing model using the following weighted average assumptions: volatility of 89%, risk free interest rate of 1.8%, an expected life of 2.7 years, and a dividend yield of 0%.  The Company accounted for this transaction using the acquisition method. The fair value of the net assets acquired was:  Cash and cash equivalents$     4,463,269Amounts receivable51,918Marketable securities162,630Prepaid expenses and deposits358,058Property, plant and equipment104,188Mineral property interests (restated)7,974,288Future income tax assets-Goodwill-Accounts payable and accrued liabilities(282,614)Reclamation obligations(45,562)Consideration paid$   12,786,175  The mineral property interest acquisition costs were expensed during the year. Transaction costs of $633,875 were expensed and included in consulting and outsourced services ($592,743), general and administrative ($39,864) and marketing services ($1,268) in the Consolidated Statement of Operations for the year ended December 31, 2009. Acquisition costs of $18,000 were included in the current years share issue costs.  -160-  KISKA METALS CORPORATION MANAGEMENTS DISCUSSION AND ANALYSIS For the year ended December 31, 2009   1.7  Capital Resources (continued)  On September 16, 2009, the Company completed a brokered private placement consisting of 9,000,000 units at $0.55 for gross proceeds of $4,950,000. Each unit consisted of one common share and one half of one non-transferable share purchase warrant. Each whole warrant entitles the holder to purchase one common share at a price of $0.80 per share until March 16, 2011. The terms of the warrants provide that if, during the term of any unexercised warrant commencing on January 17, 2010, the closing price of the common shares of the Company on any exchange is greater than $1.10 for a period of 20 consecutive trading days the Company may, at its option and by notice in writing to each holder, require the holder of the warrant to exercise such warrant within 30 days, failing which the warrant will be deemed to have expired. The units issued under the offering were subject to a four-month hold period expiring on January 17, 2010. The funds from this placement will be utilized to continue the exploration of the Whistler project and for general corporate purposes.  A cash commission of 6% of the total gross proceeds realized from the placement was payable in cash together with 540,000 agents warrants, equal to 6% of the number of units placed. Each agents warrant will entitle the holder to purchase one common share at a price of $0.80 per share until March 16, 2011.  Subsequent to year end, the Corporation arranged a non-brokered private placement of 9,092,500 units at a price of $0.66 per unit, for gross proceeds of $6 million. Each unit consisted of one common share and one-half of one non-transferable share purchase warrant. Each whole warrant entitles the holder to purchase, for a period of one year from the closing of the private placement (the "Closing"), one common share at a price of $0.92 per share. The warrants will contain a provision that will enable the Company to force exercise of the warrants if, during the term of any unexercised warrant commencing four months after the Closing, the common shares of the Company trade on any exchange for a period of 20 consecutive trading days at a price of $1.40 per share or greater. This placement closed in two tranches on March 2 and March 11, 2010. The Company paid share issue costs of $218,300 and issued 135,300 Brokers Warrants in connection with the financing. Net cash proceeds were $5,782,750. A total of 9,092,500 shares were issued subject to a four-month hold and 4,546,250 share purchase warrants exercisable at $0.92 for one year from the Closing. The funds raised will be used to further exploration of the Whistler Project and for general corporate purposes.  Contractual Obligations  Kiska has future obligations under various contracts relating to operating leases and minimum conditional and non-conditional exploration commitments to keep properties and tenements in good standing. The obligations for any conditional exploration expenditures are non-binding, as the Company has the option to relinquish these licenses and tenements and any rights to the properties at any time.   -161-  KISKA METALS CORPORATION MANAGEMENTS DISCUSSION AND ANALYSIS For the year ended December 31, 2009   1.7  Capital Resources (continued)  The table below provides a summary of these contractual obligations (based on undiscounted cash flows) as at December 31, 2009:


|                                     |                   |                   |                        |                    |                  
|------------------------------------ | ----------------- | ----------------- | ---------------------- | ------------------ | -----------------
|                                     | Total             | Less than 1 year  | 1  3 years            | 3  5 years        | More than 5 years
|Operating leases                     | $          95,555 | $          95,555 | $                    - | $                - | $              - 
|Conditional exploration expenditures | 4,236,880         | 757,178           | 1,496,227              | 910,203            | 1,073,272        
|Total contractual obligations        | $     4,332,435   | $        852,733  | $     1,496,227        | $    910,203       | $1,073,272       

1.8  Off-Balance Sheet Arrangements  As a policy, the Company does not enter into off-balance sheet arrangements with special-purpose entities in the normal course of its business, nor does it have any unconsolidated affiliates.  1.9  Transactions with Related Parties  (a) Note Payable  On March 9, 2009, the Company announced it had negotiated a line of credit with Geologic Resource Partners LP (GRP), allowing it to draw down, as necessary a maximum amount of $2.6 million. The line of credit bore interest at an annual rate of 15%, payable at maturity. On March 27, 2009 and June 8, 2009, the Company drew $1,000,000 and $750,000, respectively, under the line of credit. The entire amount of note payable including accrued interest was repaid on August 5, 2009.  (b) Due to related party  Due to related party at December 31, 2009 includes amounts payable to Equity Exploration Consultants Ltd. Some of the Companys mineral property evaluation and exploration projects are managed by Equity Exploration Consultants Ltd. and Equity Geoscience, Ltd. (collectively Equity), companies partially owned (indirectly) by a director of the Company. Balances payable to Equity for fees and reimbursement of costs incurred on behalf of the Company have been separately disclosed as Due to related party. Fees charged to the Company by Equity are on the same basis as those charged by Equity to unrelated third parties. It is anticipated that Equity will continue to provide geological consulting and administrative support services to the Company from time to time, and will be remunerated for such services at the rate charged by Equity to all its customers.   -162-  KISKA METALS CORPORATION MANAGEMENTS DISCUSSION AND ANALYSIS For the year ended December 31, 2009   1.9  Transactions with Related Parties (continued)  (b) Due to related party (continued)  As at December 31, 2009, the Corporation was indebted to Equity, in the amount of $11,340 for management services provided by Equity During the year ended December 31, 2009, the Corporation paid Equity $54,000 (2008 - $Nil, 2007 - $Nil) for providing management services. There were no other transactions with Equity during the year.  Included in due to related party at December 31, 2008 is an amount of $225,000 representing the severance payment due to an officer upon a change of control of the Company.  (c) Mineral property interests  One of the directors indirectly owns 11% of a 7.5 to 15% Net Profits Interest (NPI) in the Wernecke Breccia property. The claims were originally staked and explored by a company in which he holds an interest. When the property was sold to the Newmont and NVI Mining Ltd, their company retained an NPI of varying amounts depending on the claim group.  1.10  Fourth Quarter  The Company has an incentive stock option plan for directors and employees. During the fourth quarter, the directors authorized the granting of stock options to directors, officers and employees. Since the company has adopted a policy of accounting for share-based compensation at fair market value, this resulted in a significant increase in expense for the fourth quarter. Expenditures for salaries and support during the fourth quarter were slightly higher than average since unused compensatory time off is paid in cash at the end of each calendar year.  Reclamation obligations for each property with substantial exploration programs under the direction of the Company were re-evaluated to determine if allowances which had been previously estimated were still valid. Several properties had significant changes in exploration undertaken or reclamation work completed during 2009 which resulted in changes to the estimates for reclamation obligations. The new figures are reflected in the financial statements as a liability for the Company. When the reclamation activities are completed, this liability will be reduced by the actual costs incurred with any variance reported as reclamation obligation expense in that period. Several properties do not have reclamation obligations accrued as yet since no exploration work has been undertaken.  The Company is committed to sustainable resource development and ensures all its activities comply with regulatory requirements and strives to meet or exceed industry best practices. During the last quarter of 2009, the Company commenced a community consultation and engagement process for the Whistler project. In addition, completion of exploration work and compilation of the data derived from the geophysical surveys increased exploration expenditures in a period which typically would have lower exploration costs.   -163-  KISKA METALS CORPORATION MANAGEMENTS DISCUSSION AND ANALYSIS For the year ended December 31, 2009   1.11  Proposed Transactions  The Company has a business plan that includes identifying exploration projects, conducting initial exploration then optioning the project to a partner. Acquisitions and dispositions are an essential and on-going part of this plan.  1.12  Critical Accounting Estimates  Not applicable  1.13  Changes in Accounting Policies including Initial Adoption  The Canadian Institute of Chartered Accountants (CICA) has issued Handbook Section 3064, Goodwill and Intangible Assets, which replaced Section 3062, Goodwill and Intangible Assets. The new standard is applicable for interim and annual financial statements relating to fiscal years beginning on or after October 1, 2008. Section 3064 establishes revised standards for the recognition, measurement, presentation and disclosure of goodwill subsequent to its initial recognition, and of intangible assets. Section 3064 also provides guidance for the treatment of preproduction and start-up costs and generally requires that these costs be expensed as incurred. The Company adopted Section 3064 as of January 1, 2009, and its adoption had no impact on the Companys consolidated financial statements.  In January 2009, the CICA issued Handbook Section 1582, Business Combinations, which will provide the Canadian equivalent to International Financial Reporting Standards (IFRS) 3, Business Combinations and replace the existing Handbook Section 1581, Business Combinations. The new standard will apply prospectively to business combinations for which the acquisition date is on or after January 1, 2011. Earlier adoption is permitted as of the beginning of a fiscal year, in which case an entity would also be required to early adopt Handbook Section 1601, Consolidated Financial Statements and Handbook Section 1602, Non-controlling Interests. The Company adopted these sections as of January 1, 2009, and accounted for its acquisition of Rimfire in accordance with Section 1582.  In January 2009, the CICA also issued Handbook Section 1601, Consolidated Financial Statements, which establishes standards for the preparation of consolidated financial statements and, along with Section 1602, will replace the existing Handbook Section 1600, Consolidated Financial Statements. The new standard is effective for interim and annual financial statements relating to fiscal years beginning on or after January 1, 2011. Earlier adoption is permitted as of the beginning of a fiscal year, in which case an entity would also be required to early adopt Handbook Section 1582, Business Combinations and Handbook Section 1602, Non-Controlling Interests.  The Company adopted these sections as of January 1, 2009, and the adoption of Section 1601 had no impact on the Companys consolidated financial statements.   -164-  KISKA METALS CORPORATION MANAGEMENTS DISCUSSION AND ANALYSIS For the year ended December 31, 2009   1.13  Changes in Accounting Policies including Initial Adoption (continued)  In January 2009, the CICA also issued Handbook Section 1602, Non-Controlling Interests, which establishes standards for accounting for a non-controlling interest in a subsidiary in consolidated financial statements subsequent to a business combination. It is equivalent to the corresponding provisions of International Accounting Standard IAS 27, Consolidated and Separate Financial Statements. The new standard is effective for interim and annual financial statements relating to fiscal years beginning on or after January 1, 2011. Earlier adoption is permitted as of the beginning of a fiscal year, in which case an entity would also be required to early adopt Handbook Section 1582, Business Combinations and Handbook Section 1601, Consolidated Financial Statements. The Company adopted these sections as of January 1, 2009, and the adoption of Section 1602 had no impact on the Companys consolidated financial statements.  In January 2009, the Emerging Issues Committee (EIC) of the CICA issued Emerging Issues Committee Abstract 173, Credit Risk and the Fair Value of Financial Assets and Financial Liabilitieswhich provides guidance on the implications of credit risk in determining the fair value of an entitys financial assets and financial liabilities. The guidance clarifies that an entitys own credit risk and the credit risk of counterparties should be taken into account in determining the fair value of financial assets and financial liabilities, including derivative instruments, for presentation and disclosure purposes. The Companys fair value disclosures incorporate this new guidance.  In June 2009, the CICA amended Handbook Section 1506 Accounting Changes. The amendment excludes changes in accounting policies upon the complete replacement of an entitys primary basis of accounting, as will occur when an entity adopts IFRSs for the first time, from the scope of Section 1506.  In June 2009, the CICA also amended Handbook Section 3862, Financial Instruments  Disclosures to provide the Canadian equivalent to amendments made to IFRS 7, Financial Instruments: Disclosures. The amendments require enhanced disclosure requirements, which include:  · classifying and disclosing fair value measurements based on a three-level hierarchy · Level 1  inputs are unadjusted quoted prices in active markets for identical assets or liabilities; · Level 2  inputs other than quoted prices in Level 1 that are observable for the asset or liability, either directly or indirectly; and · Level 3  inputs for the asset or liability that are not based on observable market data. · reconciling beginning balances to ending balances for Level 3 measurements · identifying and explaining movements between levels of the fair value hierarchy · providing a maturity analysis for derivative financial liabilities based on how the entity manages liquidity risk, and · disclosing the remaining expected maturities of non-derivative financial liabilities if liquidity risk is managed on that basis.  These amendments are applicable to financial statements for fiscal years ending after September 30, 2009 and comparative information is not required in the year these amendments are first implemented. Applicable disclosures have been included in Note 5 to the consolidated financial statements.  -165-  KISKA METALS CORPORATION MANAGEMENTS DISCUSSION AND ANALYSIS For the year ended December 31, 2009   1.13  Changes in Accounting Policies including Initial Adoption (continued)  In August 2009, the CICA issued amendments to Handbook Section 3251, Equity as a consequence of issuing Section 1602, Non-controlling Interests. The amendments require non-controlling interests to be recognized as a separate component of equity.  The new standard is effective for interim and annual financial statements relating to fiscal years beginning on or after January 1, 2011. Earlier adoption is permitted as of the beginning of a fiscal year, in which case an entity would also be required to early adopt Handbook Section 1602, Non-Controlling Interests. The Company adopted these sections as of January 1, 2009, and their adoption had no impact on the Companys consolidated financial statements.  In August 2009, the CICA also amended Handbook Section 3855, Financial Instruments  Recognition and Measurement, bringing greater consistency between Canadian GAAP, IFRSs and US GAAP on the timing of impairment recognition for debt instruments. Companies that have classified financial assets as held-to-maturity investments are now required to assess those financial assets using the impairment requirements of Handbook Section 3025, Impaired Loans. Section 3025 was consequentially amended to accommodate the changes to Section 3855. The amendments allow more debt instruments to be classified as loans and receivables. This allows those instruments to be evaluated for impairment using Section 3025. In addition, the amendments require reversal of previously recognized impairment losses on available-for-sale financial assets in specified circumstances and require that loans and receivables that an entity intends to sell immediately or in the near term be classified as held for trading. These amendments did not affect the recognition or measurement of the Companys financial instruments.  Future Accounting Changes  Convergence with International Financial Reporting Standards  In 2006, the Accounting Standards Board of the CICA ratified a strategic plan that will result in Canadian GAAP, as used by public companies, evolving and being converged with International Financial Reporting Standards over a transitional period currently expected to be completed by 2011. The International Accounting Standards Board currently has projects underway that should result in new pronouncements which will be included in the convergence process.  The Company is in the process of completing a detailed assessment of the requirements of the transition to IFRS, with the intention of identifying: (i) the timing of the implementation of the transition, (ii) major differences from existing accounting policies (iii) new accounting policies which are appropriate for the Company, (iv) the appropriate disclosures in financial statements prepared under IFRS and (v) developing an implementation plan. The Company has put some systems in place to ensure adequate data collection and is developing disclosure templates to ensure compliance with the standards at the transition date.   -166-  KISKA METALS CORPORATION MANAGEMENTS DISCUSSION AND ANALYSIS For the year ended December 31, 2009   1.14 Financial Instruments and Other Instruments  The company does not employ a hedging strategy or a foreign exchange protection strategy. The majority of the Companys income and expenses are denominated in Canadian dollars. The income which is received in U.S. Dollars is preserved in a U.S. Dollar account for use in paying U.S. Dollar denominated expenses.  1.15  Other Requirements  Risks Factors and Uncertainties Overview  The Company is subject to many risks that may affect future operations over which the Company has little control. These risks include, but are not limited to, market conditions and the Companys ability to access new sources of capital, the results from property exploration and development activities, and currency fluctuations. Access to Capital  The exploration and subsequent development of mineral properties is capital intensive. Should it not be possible to raise additional equity funds when required, the Company may not be able to continue to fund its operations which would have a material adverse effect on the Companys potential profitability and ability to continue as a going concern. Speculative Nature of Mineral Exploration and Development  The exploration for and development of mineral deposits involves significant risk which even a combination of careful evaluation, experience and knowledge may not adequately mitigate.  While the discovery of an ore body may result in substantial rewards, few properties which are explored are ultimately developed into producing mines.  There is no assurance that commercial quantities of ore will be discovered on any of Kiskas sole-risk or ventured properties. Even if commercial quantities of ore are discovered, there is no assurance that the mineral property will be brought into production.  Whether a mineral deposit will be commercially viable depends on a number of factors, including the particular attributes of the deposit, such as its size, grade and proximity to infrastructure; commodity prices, which have fluctuated widely in recent years; and government regulations, including those relating to taxes, royalties, land tenure, land use, aboriginal rights, importing and exporting of minerals and environmental protection.  The exact effect of these factors cannot be accurately predicted, but Kiskas business may be adversely affected by the inability of Kiska or those companies with which Kiska forms exploration or development alliances, to bring projects into commercial production.  -167-  KISKA METALS CORPORATION MANAGEMENTS DISCUSSION AND ANALYSIS For the year ended December 31, 2009   Risks Factors and Uncertainties (continued) Commodity Prices  The prices of gold, copper, zinc and other minerals have fluctuated widely in recent years and are affected by a number of factors beyond the control of Kiska, including international economic and political conditions, expectations of inflation, international currency exchange rates, consumption patterns, and levels of supply and demand.  Fluctuations in commodity prices will influence the willingness of investors to fund mining and exploration companies and the willingness of such companies to participate in joint ventures with Kiska and the level of their financial commitment. Similarly, the ability of Kiska to monetize assets may also be affected by fluctuations in commodity prices. Competition  Other exploration and geoscience technology companies, including those with greater financial resources than Kiska, could adopt or may have adopted the business strategies of Kiska and thereby compete directly with Kiska, or may seek to acquire and develop mineral claims in areas targeted by Kiska. While the risk of direct competition may be mitigated by Kiskas experience and technological capabilities, there can be no assurance that competition will not increase or that Kiska will be able to compete successfully. Conflicts of Interest  Certain directors and officers of Kiska also serve as directors, officers and advisors of other companies involved in natural resource exploration and development. To the extent that such companies may participate in ventures with Kiska, such directors and officers may have conflicts of interest in negotiating and concluding the terms respecting the extent of such participation.  Such other companies may also compete with Kiska for the acquisition of mineral property rights.  In the event that any such conflict of interest arises, Kiskas policy is that such director or officer will disclose the conflict to the board of directors and, if the conflict involves a director, such director will abstain from voting on the matter. In accordance with the Business Corporations Act (Yukon), the directors and officers of Kiska are required to act honestly, in good faith with a view to the best interests of Kiska.  Government Regulation  The Company operates in an industry which is governed by environmental regulations as well as occupation health and safety regulations. Most of the Companys mineral properties are subject to government tenure requirements. At present, the Company fully complies with all regulations and holds clear title to the mineral property interests. However, it is possible that regulations or tenure requirements could be changed by the respective government resulting in additional costs or barriers to development of the properties. This would adversely affect the value of properties and ability to hold onto them without incurring significant additional costs.   -168-  KISKA METALS CORPORATION MANAGEMENTS DISCUSSION AND ANALYSIS For the year ended December 31, 2009   Other Information  The Company files technical reports on all material properties, press releases and material change reports on SEDAR at www.sedar.com. The company is a foreign private issuer as defined by the Securities and Exchange Commission in the United States. As such, the Company files an annual report on Form 20-F and interim reports and other filings on Form 6-K. These reports are available on EDGAR at www.sec.gov/edgar. Additional information about the company can be accessed at the companys website (www.kiskametals.com)  Forward-Looking Statements  This document includes certain forward looking statements concerning the future performance of Kiskas business, its operations and its financial performance and condition, as well as managements objectives, strategies, beliefs and intentions. Forward-looking statements are frequently identified by such words as may, will, plan, expect, anticipate, estimate, intend and similar words referring to future events and results.  Forward-looking statements are based on the current opinions and expectations of management.  All forward-looking information is inherently uncertain and subject to a variety of assumptions, risks and uncertainties. Factors that may cause actual results to vary include, but are not limited to, the Companys ability to access capital, the speculative nature of mineral exploration and development, fluctuating commodity prices, competitive risks and reliance on key personnel, as described in more detail in this document under Risk Factors and Uncertainties.  Statements relating to estimates of reserves and resources are also forward-looking statements as they involve risks and assumptions (including but not limited to assumptions with respect to future commodity prices and production economics) that the reserves and resources described exist in the quantities and grades estimated and are capable of economic extraction. Actual events or results may differ materially from those projected in the forward-looking statements and we caution against placing undue reliance thereon.  All mineral resources referenced in the technical report filed for the Whistler Property have been estimated in accordance with the definition standards on mineral resources and mineral reserves of the Canadian Institute of Mining, Metallurgy and Petroleum referred to in NI 43-101. U.S. reporting requirements for disclosure of mineral properties are governed by the SEC Industry Guide 7 ("Guide 7"). NI 43-101 and Guide 7 standards are substantially different. The terms "mineral reserve", "proven mineral reserve" and "probable mineral reserve" are Canadian mining terms as defined in accordance with NI 43-101. These definitions differ from the definitions of "proven (measured) reserves" and "probable (indicated) reserves" in Guide 7. Under Guide 7 standards, a "final" or "bankable" feasibility study is required to report reserves, the three-year historical average price is used in any reserve or cash flow analysis to designate reserves and the primary environmental analysis or report must be filed with the appropriate governmental authority.  The technical report uses or may use the terms "mineral resource," "indicated mineral resource" and "inferred mineral resource". We advise investors that these terms are defined in and required to be disclosed by NI 43-101. However, these terms are not defined terms under Guide 7 and are normally not permitted to be used in reports and registration statements filed with the SEC. Investors are cautioned not to assume that any part or all of mineral deposits in these categories will ever be converted into reserves. "Inferred mineral resources" have a great amount of uncertainty as to their existence and economic and legal feasibility. It cannot be assumed that all or any part of an inferred mineral resource will ever be upgraded to a higher category. Under Canadian rules, estimates of inferred mineral resources may not form the basis of feasibility or pre-feasibility studies, except in rare cases. Investors are cautioned not to assume that all or any part of an inferred mineral resource exists or is economically or legally mineable.   -169-