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UNITED STATESSECURITIES AND EXCHANGE COMMISSIONWashington, D.C. 20549

FORM 10-K

(Mark One)

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

For the fiscal year ended June 30, 2010

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

For the transition period from _____ to _____

Commission File Number:000-33189

CANYON COPPER CORP.(Exact
name of registrant as specified in its charter)

|NEVADA                                                               | 88-0452792                                      
|-------------------------------------------------------------------- | ------------------------------------------------
|(State or other jurisdiction of incorporation or
      organization) | (I.R.S. Employer Identification
      No.)      
|                                                                     |                                                 
|Suite 408 - 1199 West Pender Street                                  |                                                 
|Vancouver, BC, Canada                                                | V6E 2R1                                         
|(Address of principal executive offices)                             | (Zip Code)                                      
|                                                                     |                                                 
|Registrants telephone number, including area code                   | (604) 331-9326                                  
|                                                                     |                                                 
|Securities registered under Section 12(b) of the Exchange
      Act: | NONE.                                           
|Securities registered under Section 12(g) of the Exchange
      Act: | Common Stock, $0.00001
      Par Value per Share

Indicate by check mark if the registrant is a well-known
seasoned issuer, as defined by Rule 405 of the Securities Act. Yes [ 
 ]    No [X]

Indicate by check mark if the registrant is not required to file
reports pursuant to Section 13 or Section 15(d) of the Act. Yes [ 
 ]    No [X]

Indicate by check mark whether the registrant (1) has filed all
reports required to be filed by Section 13 or 15(d) of the Securities Exchange
Act of 1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to such
filing requirements for the past 90 days. Yes [X]No [   ]

Indicate by check mark whether the registrant has submitted
electronically and posted on its corporate Web site, if any, every Interactive
Data File required to be submitted and posted pursuant to Rule 405 of Regulation
S-T (s. 229.405 of this chapter) during the preceding 12 months (or for such
shorter period that the registrant was required to submit and post such files).
Yes [   ]    No [   ]

Indicate by check mark if disclosure of delinquent filers
pursuant to Item 405 of Regulation S-K (s229.405 of this chapter) is not
contained herein, and will not be contained, to the best of registrants
knowledge, in definitive proxy or information statements incorporated by
reference in Part III of this Form 10-K or any amendment to this Form 10-K.
[   ]

Indicate by check mark whether the registrant is a large
accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller
reporting company. See the definitions of large accelerated filer,
accelerated filer and smaller reporting company in Rule 12b-2 of the
Exchange Act.

|Large accelerated filer [   ] |                                                     | Accelerated
      filer                     
       [   ]
|----------------------------- | --------------------------------------------------- | ---------------------------------------------------------
|Non-accelerated filer   [   ] | (Do not check if
      a smaller reporting company) | Smaller reporting company
      [X]                      

Indicate by check mark whether the registrant is a shell company
(as defined in Rule 12b-2 of the Act). Yes [   ]  
 No [X]

State the aggregate market value of the voting and non-voting
common equity held by non-affiliates computed by reference to the price at which
the common equity was sold, or the average bid and asked price of such common
equity, as of the last business day of the registrants most recently completed
second fiscal quarter. $4,292,248, based on a closing price of $0.06 of the
issuers common stock on December 31, 2009.

State the number of shares outstanding of each of the issuers
classes of common equity, as of the latest practicable date:78,390,307, as at September 21, 2010.

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CANYON COPPER CORP.ANNUAL REPORT ON FORM 10-KFOR THE YEAR ENDED JUNE 30, 2010

TABLE OF CONTENTS

|               |                                                                                                                          | **PAGE**
|-------------- | ------------------------------------------------------------------------------------------------------------------------ | --------
|               |                                                                                                                          |         
|PART I         |                                                                                                                          | 4       
|               |                                                                                                                          |         
|ITEM 1.        | BUSINESS                                                                                                                 | 4       
|ITEM 1A.       | RISK FACTORS                                                                                                             | 8       
|ITEM 2.        | PROPERTIES                                                                                                               | 13      
|ITEM 3.        | LEGAL PROCEEDINGS                                                                                                        | 20      
|               |                                                                                                                          |         
|PART II        |                                                                                                                          | 21      
|               |                                                                                                                          |         
|ITEM 5.        | MARKET FOR REGISTRANTS
      COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY
      SECURITIES | 21      
|ITEM 7.        | MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
      AND RESULTS OF OPERATIONS.                             | 22      
|ITEM 8.        | FINANCIAL STATEMENTS AND SUPPLEMENTARY
      DATA.                                                                       | 26      
|ITEM 9.        | CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING
      AND FINANCIAL DISCLOSURE                               | 27      
|ITEM 9AT.      | CONTROLS AND PROCEDURES.                                                                                                 | 27      
|ITEM 9B.       | OTHER INFORMATION.                                                                                                       | 29      
|               |                                                                                                                          |         
|PART III       |                                                                                                                          | 30      
|               |                                                                                                                          |         
|ITEM 10.       | DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE                                                                   | 30      
|ITEM 11.       | EXECUTIVE COMPENSATION.                                                                                                  | 33      
|ITEM 12.       | SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
      AND RELATED STOCKHOLDER MATTERS                     | 34      
|ITEM 13.       | CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR
      INDEPENDENCE.                                         | 37      
|ITEM 14.       | PRINCIPAL ACCOUNTING FEES AND SERVICES.                                                                                  | 38      
|ITEM 15.       | EXHIBITS, FINANCIAL STATEMENT SCHEDULES.                                                                                 | 39      
|               |                                                                                                                          |         
|**SIGNATURES** | 43                                                                                                                      

2

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CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING
STATEMENTS

Certain statements contained in this Annual Report
constitute "forward-looking statements. These statements, identified by words
such as plan, "anticipate, "believe, "estimate, "should, "expect" and
similar expressions include our expectations and objectives regarding our future
financial position, operating results and business strategy. Forward-looking
statements involve known and unknown risks, uncertainties, assumptions and other
factors that may cause the actual results, performance or achievements of the
Company to be materially different from any future results, performance or
achievements expressed or implied by the forward-looking statements. Such
factors include, among others, general business, economic, competitive,
political and social uncertainties; the actual results of current exploration
activities; actual results of reclamation activities; conclusions of economic
evaluations; changes in project parameters as plans continue to be refined;
changes in labour costs or other costs of production; future mineral prices;
equipment or processes to operate as anticipated; accidents, labour disputes and
other risks of the mining industry, including but not limited to environmental
hazards, cave-ins, pit-wall failures, flooding, rock bursts and other acts of
God or unfavourable operating conditions and losses; political instability,
insurrection or war; delays in obtaining governmental approvals or financing or
in the completion of development or construction activities, as well as those
factors discussed in the section titled "Item 1A. Risk Factors" in this Annual
Report.

Forward looking statement are based on a number of material
factors and assumptions, including the results of exploration and drilling
activities, the availability and final receipt of required approvals, licenses
and permits, that sufficient working capital is available to complete proposed
exploration and drilling activities, that contracted parties provide goods
and/or services on the agreed time frames, the equipment necessary for
exploration is available as scheduled and does not incur unforeseen break downs,
that no labour shortages or delays are incurred and that no unusual geological
or technical problems occur. While the Company considers these assumptions may
be reasonable based on information currently available to it, they may prove to
be incorrect. Actual results may vary from such forward-looking information for
a variety of reasons, including but not limited to risks and uncertainties
disclosed in the section titled Item 1A. Risk Factors in this Annual Report.

CAUTIONARY NOTE TO U.S. INVESTORS REGARDING ESTIMATES OF
MEASURED, INDICATED AND INFERRED RESOURCES

This Annual Report uses the terms measured, indicated
and inferred resource in accordance with National Instrument 43-101 
Standards of Disclosure for Mineral Projects, as required by Canadian securities
regulatory authorities. We advise U.S. investors that while these terms are
recognized and required by Canadian regulations, the SEC does not recognize
them. Inferred resources have a great amount of uncertainty as to their
existence, and great uncertainty as to their 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 a feasibility study or
prefeasibility studies, except in rare cases. The SEC normally only permits
issuers to report mineralization that does not constitute reserves as in-place
tonnage and grade without reference to unit measurements. U.S. investors are cautioned not to assume that any part or all of a
measured, indicated or inferred resource exists or its economically or legally
mineable.

As used in this Annual Report, the terms we, us, our,
Canyon Copper, and the Company refer to Canyon Copper Corp., unless
otherwise indicated. All dollar amounts in this Annual Report are expressed in
U.S. dollars, unless otherwise indicated.

3

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PART I

ITEM
1.            
BUSINESS.

OVERVIEW

We were incorporated on January 21, 2000 under the laws of the
State of Nevada.

We are an exploration stage company engaged in the acquisition,
exploration and development of mineral properties. We currently hold 100% title
in two major claim blocks comprising a total of 1,293 mineral claims, covering
approximately 25,860 acres located in Mineral County, Nevada (the New York
Canyon Claims). We also hold 21 patented mineral claims covering an area of
approximately 420 acres, located within the vicinity of the New York Canyon
Claims area. We collectively refer to the New York Canyon Claims and the
patented claims as the New York Canyon Project.

We have not earned any revenues to date and do not anticipate
earning revenues until such time as we enter into commercial production of our
mineral properties. We are presently in the exploration stage of our business
and we can provide no assurance that commercially viable mineral deposits exist
on our claims or that we will discover commercially exploitable levels of
mineral resources on our properties, or if such deposits are discovered, that we
will enter into further substantial exploration programs.

RECENT CORPORATE DEVELOPMENTS

Since the filing of our Quarterly Report for the fiscal quarter
ended March 31, 2010 with the SEC on April 14, 2010, we experienced the
following significant corporate developments:

|1. | On August 5, 2010, we entered into a purchase agreement
      with ESO Uranium Corp. (ESO) whereby we transferred 39 mineral claims to
      ESO for consideration of a 2% net smelter returns royalty over any future
      production on the transferred claims.                                                                                              
|-- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|   |                                                                                                                                                                                                                                                                                                                                                                   
|2. | On August 24, 2010, we dismissed Manning Elliott LLP, as
      our independent public accountants. Our Board of Directors and Audit
      Committee approved the dismissal of Manning Elliott LLP. See Item 9.
      Changes in and Disagreements with Accountants on Accounting and Financial
      Disclosure.                                                
|   |                                                                                                                                                                                                                                                                                                                                                                   
|3. | Also on August 24, 2010, we appointed Saturna Group
      Chartered Accountants LLP ("Saturna") as our new independent registered
      public accounting firm. Our Board of Directors and Audit Committee
      approved the engagement of Saturna. See Item 9. Changes in and
      Disagreements with Accountants on Accounting and Financial
    Disclosure.

NEW YORK CANYON PROJECT

Property Option Agreement with Nevada Sunrise, LLC

Effective March 16, 2007, we acquired 100% title to the mineral
claims underlying the New York Canyon Claims. The acquisition of title to the
claims was completed pursuant to the terms of the Property Option Agreement (the
Property Option Agreement) we entered into with Nevada Sunrise LLC (Nevada
Sunrise), Robert Weicker, Sharon Weicker, Kurt Schendel, and Tami Schendel
(collectively, the Optionors) on March 18, 2004.

Under the terms of the Property Option Agreement, we exercised
our option to acquire the New York Canyon Claims by: (i) paying $460,000 to the
Optionors; (ii) issuing 2,000,000 shares of our common stock to the Optionors;
and (iii) incurring exploration expenditures of a minimum of $2,250,000 on the
New York Canyon Claims.

The Optionors also retained a 2% net smelter returns royalty
(the Royalty) over any future production. We have the option to reduce the
Royalty to 1% by making a lump sum payment of $1,000,000 to the Optionors.

In accordance with the terms of the Property Option Agreement
and upon our acquisition of the New York Canyon Claims, Nevada Sunrise assigned
us its interest under two lease agreements. On October 9, 2004, Nevada Sunrise
entered into a lease agreement with Tammy Gentry and Pat Hannigan pursuant to
which it obtained a nine year lease over the Copper Queen #2 patented
mineral claim. As a result of the assignment of this lease to us, we are
required to pay $1,500 per quarter commencing on October 1, 2004. We have the
option to acquire Copper Queen #2 by paying $50,000, of which the quarterly
payments may be applied, to the lessors.

4

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In addition, on January 1, 2005, Nevada Sunrise entered into a
lease agreement with Clifford DeGraw and Richard Markiewicz pursuant to which it
obtained a seven year lease over the Mildred and Copper Queen #1 patented
mineral claim. As a result of the assignment of these leases to us, we are
required to pay:

| | (a) | $2,500 per quarter commencing on April 1, 2005 (which
      payments have been made);        
| | --- | ---------------------------------------------------------------------------------------------
| |     |                                                                                              
| | (b) | $3,500 per quarter commencing on April 1, 2006 (which
      payments have been made);        
| |     |                                                                                              
| | (c) | $4,000 per quarter commencing on April 1, 2007 (which
      payments have been made);        
| |     |                                                                                              
| | (d) | $5,000 per quarter commencing on April 1, 2008 (which
      payments have been made); and    
| |     |                                                                                              
| | (e) | $7,500 per quarter commencing on April 1, 2009 (which
      payments have been made to date).

We also have the option to acquire the Mildred and Copper Queen
#1 patented claims by paying $130,000, of which the quarterly payments may be
applied, to the lessors.

Lease Agreement with Jaycor Mining Inc.

On July 21, 2004, we entered into a lease agreement (the Lease
Agreement) with Jaycor Mining, Inc. (Jaycor). Under the terms of the Lease
Agreement, we were granted rights to explore and, if proved feasible, develop 18
patented mineral claims held by Jaycor (the Jaycor Claims). These rights were
granted as a lease for an initial term of 15 years, and are renewable for a
further 15 years. The claims cover a geographic area of approximately 361 acres,
located within the vicinity of the New York Canyon Project area.

As consideration for the lease of the Jaycor Claims, we are
required to pay Jaycor the following amounts prior to the commencement of any
future production activities:

| | (a) | $25,000 on execution of the Lease Agreement (which
      payments have been made);                                                                                                                                                     
| | --- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |     |                                                                                                                                                                                                                                        
| | (b) | $1,000 monthly commencing on July 21, 2005, the first
      anniversary of the effective date of the Lease Agreement (which payments
      have been made);                                                                            
| |     |                                                                                                                                                                                                                                        
| | (c) | $2,000 monthly commencing on July 21, 2006, the second
      anniversary of the effective date of the Lease Agreement (which payments
      have been made);and                                                                        
| |     |                                                                                                                                                                                                                                        
| | (d) | $3,000 monthly commencing on July 21, 2007, the third
      anniversary of the effective date of the Lease Agreement, and continuing
      for as long as the Lease Agreement is in effect (collectively, the
      Minimum Payments)

In addition to the Minimum Payments, we issued 10,000 shares of
its common stock in 2005 to Jaycor and a further 15,000 common shares in 2006
pursuant to the terms of the Lease Agreement. As of the date of this Annual
Report, we have made all required Minimum Payments under the Lease Agreement and
are in good standing under the Lease Agreement.

The Minimum Payments are considered to be minimum advance
royalty payments. If the production commences in the future, of which there can
be no assurance, the Minimum Payments would be credited against any actual
future royalty payments. If actual royalties payable from production exceed
$9,000 per quarter, the Minimum Payments would cease. If actual royalty payments
are less than $9,000 quarterly, we would be required to pay the difference
between the actual royalty payments and the Minimum Payments. We are also
required to perform at least $100,000 of exploration work annually on the Jaycor
Claims over a four-year period.

The Jaycor Claims under the Lease Agreement are subject to an
overriding royalty deed granted to Kookaburra Resources Ltd. (Kookaburra) by
Jaycor. Upon commencement of production, we are required to pay Kookaburra a net smelter returns royalty of 1.75%, up to a
maximum of $2,000,000. In addition, we have also agreed to pay Jaycor a net
smelter return royalty of 0.5% until such time as Kookaburra has been paid
$2,000,000, at which time the royalty payable to Jaycor will then increase to
1.5% . The 1.5% rate payable is subject to a maximum of $2,000,000, at which
time the ongoing royalty payment to Jaycor will be reduced to 0.5% for as long
as the Lease Agreement is in effect.

5

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The Jaycor Claims are located in Sections 32, 33 and 34 T8N;
R35E MDBM in Mineral County, Nevada and are recorded as follows:

Name of Claim
    Mineral Survey No.
    US Patent #
    County Land ParcelMayflower
    38
    10541
    009-170-11Wall Street
    43
    21509
    009-170-09Turk
    44
    21510
    009-170-09Footwall
    3447
    264845
    009-170-03Nora Higgins
    3447
    264845
    009-170-02Willie Higgins
    3447
    264845
    009-170-02Annex No. 1
    3447
    264845
    009-170-03Annex No. 2
    3447
    264845
    009-170-03Annex No. 3
    3447
    264845
    009-170-03Annex No. 4
    3447
    264845
    009-170-03Iron Gate
    4444
    806518
    009-170-02Velvet
    4444
    806518
    009-170-02Saddle
    4444
    806518
    009-170-02Vacation
    4571
    982162
    009-170-12Goodenough
    4612
    989401
    009-170-02Copper Butte
    4612
    989401
    009-170-02Copper Bar
    4612
    989401
    009-170-02Hecla
    4612
    989401
    009-170-02


The holders of patented minerals claims generally retain all
mineral and property rights, and the permitting procedures for both exploration
and development can be streamlined and fast tracked.

PRODUCTS, MARKETS, DISTRIBUTION, SUPPLIERS, AND CUSTOMERS

We do not currently produce any products, metals, or minerals
nor do we offer any products for sale. We are not party to any distribution
arrangements, and have no principal customers or suppliers. We do not anticipate
any changes in this status for at least the next 12 months, or until such time
as there is a commercially viable mineral or metal deposits located on our
mineral property.

COMPETITION

We are an exploration stage company. We compete with other
mineral resource exploration and development companies for financing and for the
acquisition of new mineral properties. Many of the mineral resource exploration
and development companies with whom we compete have greater financial and
technical resources than us. Accordingly, these competitors may be able to spend
greater amounts on acquisitions of mineral properties of merit, on exploration
of their mineral properties and on development of their mineral properties. In
addition, they may be able to afford greater geological expertise in the
targeting and exploration of mineral properties. This competition could result
in competitors having mineral properties of greater quality and interest to
prospective investors who may finance additional exploration and development.
This competition could adversely impact on our ability to finance further
exploration and to achieve the financing necessary for us to develop our mineral
properties.

MARKETS AND ECONOMICS

Although we compete with other junior exploration companies for
financing, properties of merit, and subcontractors, there is no competition for
the exploration or removal of mineralized material from the New York Canyon
Project. Although there can be no assurance, large and well capitalized markets
are readily available for all metals and precious metals throughout the world. A
very sophisticated futures market for the pricing and delivery of future production also exists. At present there are
no limitations with respect to the sale of metals or precious metals other than
price. The price for metals is affected by a number of global factors, including
economic strength and resultant demand for metals for production, fluctuating
supplies, mining activities and production by others in the industry, and new
and or reduced uses for subject metals.

6

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DESCRIPTION OF MINING INDUSTRY

The mining industry is highly speculative and of a very high
risk nature. As such, mining activities involve a high degree of risk, which
even a combination of experience, knowledge and careful evaluation may not be
able to overcome. Few mining projects actually become operating mines.

The mining industry is subject to a number of factors,
including intense industry competition, high susceptibility to economic
conditions (such as price of metal, foreign currency exchange rates, and capital
and operating costs), and political conditions (which could affect such things
as import and export regulations, foreign ownership restrictions). Furthermore,
the mining activities are subject to all hazards incidental to mineral
exploration, development and production, as well as risk of damage from
earthquakes, any of which could result in work stoppages, damage to or loss of
property and equipment and possible environmental damage. Hazards such as
unusual or unexpected geological formations and other conditions are also
involved in mineral exploration and development.

GOVERNMENTAL CONTROLS AND APPROVALS

Exploration and development activities are all subject to
stringent national, state and local regulations. All permits for exploration and
testing must be obtained through the local Bureau of Land Management (BLM)
offices of the Department of Interior in the State of Nevada. The granting of
permits requires detailed applications and filing of a bond to cover the
reclamation of areas of exploration. From time to time, an archaeological
clearance may need to be obtained prior to proceeding with any exploration
programs.

We plan to secure all necessary permits for any future
exploration. We must provide for all environmental concerns and ensure no
discharge of water into any body of water regulated by environmental law or
regulation. Indigenous and endangered species must only be subject to very
minimal or nil disturbances. Restoration of the disturbed land will be completed
according to applicable regulations and laws. All holes, pits and shafts will be
sealed upon abandonment of the property. It is difficult to estimate the cost of
compliance with the environmental laws since the full nature and extent of our
proposed activities cannot be determined until we start our operations.

We have applied for and received permits from the BLM to
conduct drilling activities on BLM administered lands within the New York Canyon
Project. The BLM reference the property as case file NV N-79198. We are required
to adhere to the stipulations of the permit, primarily to plug all drill holes
as they are completed and to reclaim roads and drill sites when they are no
longer necessary. Reclamation work is ongoing but not complete as the project
remains active.

Our mining operation is regulated by Mine and Safety Health
Administration (MSHA). MSHA inspectors periodically visit our project to
monitor health and safety for the workers, and to inspect equipment and
installations for code requirements. All of our workers have completed MSHA
safety training and must take refresher courses annually when working on our
project. A safety officer for the project is also on site.

Other regulatory requirements monitor the following:

| | (a) | Explosives and explosives handling.                                   
| | --- | ----------------------------------------------------------------------
| | (b) | Use and occupancy of site structures associated with
      mining.    
| | (c) | Hazardous materials and waste disposal.                               
| | (d) | State Historic site preservation.                                     
| | (e) | Archaeological and paleontological finds associated with
      mining.

We believe that we are in compliance with all laws and plans to
continue to comply with the laws in the future. We believe that compliance with
the laws will not adversely affect its business operations. There is however no
assurance that any change in government regulation in the future will not
adversely affect our business operations.

7

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Federal Claim Maintenance Fees

In order to maintain our New York Canyon Project claims each
year we must pay a maintenance fee of $140 per claim to the Nevada State Office
of the Bureau of Land Management and on November 1 of each year we must file an
affidavit and Notice of Intent to Hold the claims in Mineral County. We have
paid the required maintenance fees and filed the affidavits required in order to
extend the claims to August 31, 2011.

Environmental Liability

The New York Canyon Project property has a history of
exploration and development dating back to the early 1900s. As such there are a
series of prospect pits, exploration and mine shafts, road cuts and general
mining debris scattered throughout the property. None of this is considered to
be an environmental hazard; however, open mine workings are required to be
fenced for public safety. Operators during the bulk of the exploration of the
property during the 1960s through 1990s conducted their activities in
compliance with BLM requirements. This work has been either reclaimed or
accepted by the BLM. We are not responsible for existing disturbance from prior
activities on the New York Canyon Project.

PATENTS AND TRADEMARKS

We do not own, either legally or beneficially, any patents or
trademarks.

RESEARCH AND DEVELOPMENT ACTIVITIES AND COSTS

We have no plans to undertake any research and development
activities in the foreseeable future, and have not incurred research and
development expenditures to date.

EMPLOYEES

Aside from our officers and directors, we have no employees at
present.

ITEM
1A.           RISK
FACTORS.

The following are some of the important factors that could
affect our financial performance or could cause actual results to differ
materially from estimates contained in our forward-looking statements. We may
encounter risks in addition to those described below. Additional risks and
uncertainties not currently known to us, or that we currently deem to be
immaterial, may also impair or adversely affect our business, financial
condition or results of operation.

We lack an operating history and have losses which we expect
to continue into the future. As a result, we may have to suspend or cease
exploration activities and if we do not obtain sufficient financing, our
business will fail.

We were incorporated on January 21, 2000 and to date have been
involved primarily in organizational activities, the acquisition of mineral
claims and the exploration and development on these claims. We have no
exploration history upon which an evaluation of our future success or failure
can be made. Our ability to achieve and maintain profitability and positive cash
flow is dependent upon:

| | - | our ability to locate a
      profitable mineral property; and
| | - | --------------------------------------------------------------
| |   |                                                               
| | - | our ability to generate revenues.                             

Our plan of operation calls for significant expenses in
connection with the exploration of the New York Canyon Project, which will
require us to obtain financing. We recorded a net loss of $1,057,292 for the
year ended June 30, 2010 and have an accumulated deficit of $20,985,487 since
inception. As at June 30, 2010, we had cash of $252,918 and for the next twelve
months, management anticipates that the minimum cash requirements to fund our
proposed exploration program and our continued operations will be $942,000.
Accordingly we do not have sufficient funds to meet our planned expenditures
over the next twelve months and will need to seek financing to meet our planned
expenditures.

8

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Obtaining financing would be subject to a number of factors,
including the market prices for the mineral property and base and precious
metals. These factors may make the timing, amount, terms or conditions of
additional financing unavailable to us. Since our inception, we have used our
common stock to raise money for our operations and for our property
acquisitions. We have not attained profitable operations and are dependent upon
obtaining financing to pursue our plan of operation. For these reasons, our
independent auditors believe there exists a substantial doubt about our ability
to continue as a going concern.

Because we anticipate our operating expenses will increase
prior to our earning revenues, we may never achieve profitability.

Prior to completion of our exploration stage, we anticipate
that we will incur increased operating expenses without realizing any revenues.
We therefore expect to incur significant losses into the foreseeable future. We
recognize that if we are unable to generate significant revenues from the
exploration of our mineral claims and the production of minerals thereon, if
any, we will not be able to earn profits or continue operations. There is no
history upon which to base any assumption as to the likelihood that we will
prove successful, and we may not be able to ever generate any operating revenues
or achieve profitable operations. If we are unsuccessful in addressing these
risks, our business will most likely fail.

9

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Because we are an exploration stage company, our business
has a high risk of failure.

As noted in the financial statements that are included with
this report, we are an exploration stage company that has incurred net losses
since inception, we have not attained profitable operations and we are dependent
upon obtaining adequate financing to complete our exploration activities. These
conditions, as indicated in our audit report included in this Annual Report on
Form 10-K for the year ended June 30, 2010, raise substantial doubt as to our
ability to continue as a going concern. The success of our business operations
will depend upon our ability to obtain further financing to complete our planned
exploration program and to attain profitable operations. If we are not able to
complete a successful exploration program and attain sustainable profitable
operations, then our business will fail.

Because we have not commenced business operations, we face a
high risk of business failure.

We have not earned any revenues as of the date of this Annual
Report. Potential investors should be aware of the difficulties normally
encountered by new mineral exploration companies and the high rate of failure of
such enterprises. The likelihood of success must be considered in light of the
problems, expenses, difficulties, complications and delays encountered in
connection with the exploration of the mineral properties that we plan to
undertake. These potential problems include, but are not limited to,
unanticipated problems relating to exploration, and additional costs and
expenses that may exceed current estimates.

We have no known mineral reserves and if we cannot find any,
we will have to cease operations.

We have no mineral reserves. Mineral exploration is highly
speculative. It involves many risks and is often non-productive. Even if we are
able to find mineral reserves on our property our production capability is
subject to further risks including:

|- | Costs of bringing the property into production including
      exploration work, preparation of production feasibility studies, and
      construction of production facilities, all of which we have not budgeted
      for;
|- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|- | Availability and costs of financing;                                                                                                                                                                                         
|- | Ongoing costs of production; and                                                                                                                                                                                             
|- | Environmental compliance regulations and restraints.                                                                                                                                                                         

The marketability of any minerals acquired or discovered may be
affected by numerous factors which are beyond our control and which cannot be
accurately predicted, such as market fluctuations, the lack of milling
facilities and processing equipment near the New York Canyon Project and such
other factors as government regulations, including regulations relating to
allowable production, exporting of minerals, and environmental protection. If we
do not find a mineral reserve or define a mineral inventory containing gold,
silver, copper, zinc or iron or if we cannot explore the mineral reserve, either
because we do not have the money to do it or because it will not be economically
feasible to do it, we will have to cease operations and investors will lose
their investment.

In order to maintain our rights to the New York Canyon
Project, we will be required to make annual filings with federal and state
regulatory agencies and/or be required to complete assessment work on the New
York Canyon Project.

In order to maintain our rights to the New York Canyon Project,
we will be required to make annual filings with federal and state regulatory
authorities. Currently the amount of these fees is approximately $195,000;
however, these maintenance fees are subject to adjustment. In addition, we may
be required by federal and/or state legislation or regulations to complete
minimum annual amounts of mineral exploration work on the New York Canyon
Project. A failure by us to meet the annual maintenance requirements under
federal and state laws could cause our rights to the New York Canyon Project to
lapse.

Because of the inherent dangers involved in mineral
exploration, there is a risk that we may incur liability or damages if and when
we conduct mineral exploration activities.

The search for valuable minerals involves numerous hazards. As
a result, if and when we conduct exploration activities we may become subject to
liability for such hazards, including pollution, cave-ins and other hazards
against which we cannot insure or against which we may elect not to insure. The
payment of such liabilities may have a material adverse effect on our financial
position.

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If the price of base and precious metals declines, our
financial condition and ability to obtain future financings will be
impaired.

The price of base and precious metals is affected by numerous
factors, all of which are beyond our control. Factors that tend to cause the
price of base and precious metals to decrease include the following:

| | (a) | Sales or leasing of base and precious metals by
      governments and central banks;                                                                                                                                      
| | --- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |     |                                                                                                                                                                                                                           
| | (b) | A low rate of inflation and a strong US dollar;                                                                                                                                                                           
| |     |                                                                                                                                                                                                                           
| | (c) | Speculative trading;                                                                                                                                                                                                      
| |     |                                                                                                                                                                                                                           
| | (d) | Decreased demand for base and precious metals industrial,
      jewelry and investment uses;                                                                                                                              
| |     |                                                                                                                                                                                                                           
| | (e) | High supply of base and precious metals from production,
      disinvestment, scrap and hedging;                                                                                                                          
| |     |                                                                                                                                                                                                                           
| | (f) | Sales by base and precious metals producers and foreign
      transactions and other hedging transactions; and                                                                                                            
| |     |                                                                                                                                                                                                                           
| | (g) | Devaluing local currencies (relative to base and precious
      metals price in US dollars) leading to lower production costs and higher
      production in certain major base and precious metals producing
    regions.

Our business is dependent on the price of base and precious
metals. We have not undertaken hedging transactions in order to protect us from
a decline in the price of base and precious metals. A decline in the price of
base and precious metals may also decrease our ability to obtain future
financings to fund our planned development and exploration programs.

If we are unable to hire and retain key personnel, we may
not be able to implement our business plan.

Our success is dependent upon the performance of key personnel
working full-time in management, supervisory and administrative capacities or as
consultants. This is particularly true in highly technical businesses such as
mineral exploration. These individuals are in high demand and we may not be able
to attract the personnel we need. The loss of the services of senior management
or key personnel could have a material and adverse effect on us, our business
and results of operations. Failure to hire key personnel when needed, or on
acceptable terms, would have a significant negative effect on our business.

As we undertake exploration of our mineral claims, we will
be subject to compliance with government regulation that may increase the
anticipated cost of our exploration program.

There are several governmental regulations that materially
restrict mineral exploration. We are required to obtain work permits, post bonds
and perform remediation work for any physical disturbance to the land in order
to comply with these laws. If we enter the production phase, the cost of
complying with permit and regulatory environment laws will be greater because
the impact on the project area is greater. Permits and regulations will control
all aspects of the production program if the project continues to that stage.
Examples of regulatory requirements include:

| | (a) | Water discharge will have to meet drinking water
      standards;                                              
| | --- | ---------------------------------------------------------------------------------------------------------------
| |     |                                                                                                                
| | (b) | Dust generation will have to be minimal or otherwise
      re-mediated;                                        
| |     |                                                                                                                
| | (c) | Dumping of material on the surface will have to be
      re-contoured and re-vegetated with natural vegetation;
| |     |                                                                                                                
| | (d) | An assessment of all material to be left on the surface
      will need to be environmentally benign;          
| |     |                                                                                                                
| | (e) | Ground water will have to be monitored for any potential
      contaminants;                                   

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| | (f) | The socio-economic impact of the project will have to be
      evaluated and if deemed negative, will have to be re-mediated;
  and             
| | --- | ------------------------------------------------------------------------------------------------------------------------------------------------
| |     |                                                                                                                                                 
| | (g) | There will have to be an impact report of the work on the
      local fauna and flora including a study of potentially endangered
      species.

There is a risk that new regulations could increase our costs
of doing business and prevent us from carrying out our exploration program. We
will also have to sustain the cost of reclamation and environmental remediation
for all exploration work undertaken. Both reclamation and environmental
remediation refer to putting disturbed ground back as close to its original
state as possible. Other potential pollution or damage must be cleaned-up and
renewed along standard guidelines outlined in the usual permits. Reclamation is
the process of bringing the land back to its natural state after completion of
exploration activities. Environmental remediation refers to the physical
activity of taking steps to remediate, or remedy, any environmental damage
caused. The amount of these costs is not known at this time as we do not know
the extent of the exploration program that will be undertaken beyond completion
of the recommended work program. If remediation costs exceed our cash reserves
we may be unable to complete our exploration program and have to abandon our
operations.

If we become subject to increased environmental laws and
regulation, our operating expenses may increase.

Our development and production operations are regulated by both
US Federal and Nevada state environmental laws that relate to the protection of
air and water quality, hazardous waste management and mine reclamation. These
regulations will impose operating costs on us. If the regulatory environment for
our operations changes in a manner that increases costs of compliance and
reclamation, then our operating expenses would increase with the result that our
financial condition and operating results could be adversely affected.

If we complete a financing through the sale of additional
shares of our common stock, shareholders will experience dilution.

The most likely source of future financing presently available
to us is through the issuance of our common stock. Any sale of share capital
will result in dilution to existing shareholders. The only other anticipated
alternative for the financing of further exploration would be the offering by us
of an interest in our properties to be earned by another party or parties
carrying out further exploration thereof, which is not presently contemplated.

Because our stock is a penny stock, stockholders will be
more limited in their ability to sell their stock.

The SEC has adopted rules that regulate broker-dealer practices
in connection with transactions in penny stocks. Penny stocks are generally
equity securities with a price of less than $5.00, other than securities
registered on certain national securities exchanges or quoted on the Nasdaq
system, provided that current price and volume information with respect to
transactions in such securities is provided by the exchange or quotation
system.

Because our securities constitute "penny stocks" within the
meaning of the rules, the rules apply to us and to our securities. The rules may
further affect the ability of owners of shares to sell our securities in any
market that might develop for them. As long as the quotation price of our common
stock is less than $5.00 per share, the common stock will be subject to Rule
15g-9 under the Exchange Act. The penny stock rules require a broker-dealer,
prior to a transaction in a penny stock, to deliver a standardized risk
disclosure document prepared by the SEC, that:

|1. | contains a description of the nature and level of risk in
      the market for penny stocks in both public offerings and secondary
      trading;                                                                                        
|-- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|   |                                                                                                                                                                                                                                          
|2. | contains a description of the broker's or dealer's duties
      to the customer and of the rights and remedies available to the customer
      with respect to a violation to such duties or other requirements of
      securities laws;
|   |                                                                                                                                                                                                                                          
|3. | contains a brief, clear, narrative description of a
      dealer market, including bid and ask prices for penny stocks and the
      significance of the spread between the bid and ask
price;                                           

12

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|4. | contains a toll-free telephone number for inquiries on
      disciplinary actions;                                                                         
|-- | -----------------------------------------------------------------------------------------------------------------------------------------------------------
|   |                                                                                                                                                            
|5. | defines significant terms in the disclosure document or
      in the conduct of trading in penny stocks; and                                               
|   |                                                                                                                                                            
|6. | contains such other information and is in such form,
      including language, type, size and format, as the SEC shall require by
      rule or regulation.

The broker-dealer also must provide, prior to effecting any
transaction in a penny stock, the customer with: (a) bid and offer quotations
for the penny stock; (b) the compensation of the broker-dealer and its
salesperson in the transaction; (c) the number of shares to which such bid and
ask prices apply, or other comparable information relating to the depth and
liquidity of the market for such stock; and (d) a monthly account statements
showing the market value of each penny stock held in the customer's account. In
addition, the penny stock rules require that, prior to a transaction in a penny
stock not otherwise exempt from those rules, the broker-dealer must make a
special written determination that the penny stock is a suitable investment for
the purchaser and receive the purchaser's written acknowledgment of the receipt
of a risk disclosure statement, a written agreement to transactions involving
penny stocks, and a signed and dated copy of a written suitability statement.
These disclosure requirements may have the effect of reducing the trading
activity in the secondary market for our stock.

ITEM
2.            
PROPERTIES.

We rent approximately 1,606 square feet of office space located
at Suite 408 - 1199 West Pender Street, Vancouver, British Columbia, Canada from
ESO Uranium Corp. at a cost of approximately $1,500 per month. This rental is on
a month-to-month basis with no formal agreements.

We currently do not own any real property. We currently hold
100% title in two major claim blocks comprising a total of 1,293 mineral claims,
covering approximately 25,860 acres in Mineral County, Nevada (the New York
Canyon Claims). We also hold 21 patented mineral claims covering an area of
approximately 420 acres, located within the vicinity of the New York Canyon
Claims area. We collectively refer to the New York Canyon Claims and the
patented mineral claims as the New York Canyon Project.

NEW YORK CANYON PROJECT

We hold 100% title to our New York Canyon Claims, subject to
certain royalties, and pursuant to various lease agreements, we were granted a
seven year lease to explore and develop the Copper Queen #2 patented mineral
claim, a nine year lease to explore and develop the Mildred and Copper Queen #1
patented mineral claims and a 15 year lease to explore and develop the Jaycor
Claims.

Our New York Canyon Claims consist of two major claim blocks
covering a total of 1,293 mineral claims, covering approximately 25,860 acres
located in Mineral County, Nevada. We refer to the first block of claims as the
"Copper Queen Claims, and the second contiguous block of claims as the
"Longshot Ridge Claims. Further, we hold 21 patented mineral claims covering an
area of approximately 420 acres, located within the vicinity of the New York
Canyon Claims.

13

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Figure 1  New York Canyon Property



14

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Location and Access, Climate, Local Resources, and
Physiography

The New York Canyon Project is approximately five miles east of
Luning and 30 miles east of Hawthorne, the seat of Mineral County, in the
sparsely populated westcentral part of Nevada. The largest full-service city
with daily commercial air flights to most major American cities is Reno, located
169 miles north-northwest of the New York Canyon Project via paved highway US95.
Access to the Project from Hawthorne is via paved highway US95 for 25 miles to
Luning and then by 5 miles of all-weather gravel road.

The New York Canyon Project is at the south end of the Gabbs
Valley Range with part of the Project extending westward into Soda Spring
Valley. The terrain is part of the Basin and Range physiographic province
consisting of steep rugged hills at elevations from 5,500 to 7,000 feet
separated by broad basins ranging from 4,600 to 5,500 feet elevation.

The climate is semi-arid with two seasons: a wet cold winter
and a dry hot summer. The main period of snow occurs between November and March.
Annual rainfall for the last several years has ranged from 2 to 6 inches per
year with temperatures ranging from 25°F to 95°F. The prevailing vegetation
consists of grasses, low shrubs (most commonly sagebrush) and occasional patches
of pinion pine and juniper trees at higher elevations. The local economy is
based largely on ranching and mining with many people employed by the Hawthorne
Naval Ammunition Depot.

During the past twenty years, a number of mines have operated
in this part of Nevada, mostly gold and silver mines with some by-product base
metals. As a result, the community contains a small pool of experienced labor
sufficient for the needs of many short-term mining operations.

History

The New York Canyon Project has a long history of exploration,
development and production beginning with discovery of the copper oxide deposits
in 1875. The districts first recorded production occurred from 1906 to 1929
when the Wall Street Copper Company consolidated various holdings in the
district and commenced copper production at the Anderson, Champion, Mayflower,
New York, Turk, Vacation and Wall Street Mines. An estimated 8.9 million pounds
of copper was recovered from approximately 110,000 tons of ore at an average
grade of 5.5% copper during this period.

1965 to 1979 A total of 107 exploration drill
holes (98,433 feet) were drilled during 1965 to 1979 in the New York Canyon
Project area, initially by Amax but primarily by Conoco Oil Company, who
subsequently operated the Project from 1977 to 1981. Exploration was focused
mainly on porphyry copper-molybdenum sulfide targets at the Copper Queen and
Champion prospects. This historic drilling by Conoco, from 1977 to 1981,
indicated 13.2 million tons of mineralized material with an average grade of
0.55% copper for the Longshot Ridge area and 142 million tons grading 0.35% and
0.015% molybdenum for the Copper Queen deposit.

In 1979, Conoco contracted Hazen Research, Inc. to conduct a
preliminary testing program for copper recovery using sulfuric acid bottle roll
leaching tests and flotation tests on drill core sample composites. Hazen
prepared composites based on five rock types crushed to minus 0.5 inch size.
Drill core from the Copper Queen deposit yielded recoveries ranging from 65% to
75% copper over the six-day leach period with acid consumptions of 160 pounds
per ton for porphyry copper mineralized rock to 509 pounds of sulfuric acid
(H2SO4) per ton of carbonate-rich host rock. Copper oxide material provided
recoveries ranging from 75.0% to 84.45% from the six-day bottle roll test with
corresponding acid consumption of 232 to 349 pounds H2SO4 per ton of ore.

1992 to 1997 Kookaburra Resources Ltd.
(Kookaburra) and its various joint venture partners  including Coca Mines and
Phelps Dodge  conducted the next stage of exploration from 1992 to 1997,
drilling 54 holes totaling 13,018 feet to test the Longshot Ridge and Copper
Queen skarns. In 1993, Peter Cowdery, PhD., P.Eng. of CORE Engineering and
Associates conducted an estimate of the mineralized material at the Longshot
Ridge copper oxide deposit for Kookaburra Resources Ltd. The CORE technical
report indicated 17.7 million tons of mineralized material with an average grade
of 0.55% copper using a 0.23% copper cutoff.

Prior to our acquisition of the New York Canyon Project,
Kookaburra commissioned Mountain States R & D International, Inc. to conduct
a simulated vat leach test to determine copper recovery in relation to acid
consumption on minus three-quarter inch copper mineralized material from
Longshot Ridge. A 13.67 kilogram composite of typical copper oxide material was placed into a 51⁄2
foot high column and leached with 25 gram per liter sulfuric acid for 19 days.
Results of the test indicated a 39.41% copper recovery with total acid
consumption of 174.7 pounds per ton of mineralized material.

15

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General Geology

The New York Canyon Project lies within the central portion of
the Walker Lane structural belt, a broad zone of northwest-southeast striking
parallel to sub-parallel, right lateral strike-slip faults extending for more
than 400 miles through western Nevada and into northern California. The
structural belt was initiated during the Jurassic period, at which time a number
of important porphyry copper deposits and related skarn deposits, such as
Yerington, were formed. Volcanism and related hydrothermal mineralization, often
of Tertiary age, are recognized along the length of this structural trend.
Significant mining districts associated with the Walker Lane Belt, in addition
to Yerington, include Comstock, Goldfield, Rawhide, Tonopah-Hall, Dome Hill and
numerous other copper and/or gold-silver occurrences.

The New York Canyon area stratigraphy is comprised mostly of
conformable marine sedimentary units of Triassic and Jurassic ages which are
intruded by granitic rocks of Cretaceous age. Tertiary-age non-mineralized
volcanic flows locally cover these older rocks on the hills and Quaternary-age
alluvium and colluvium cover them in the valleys. At New York Canyon, the rocks
are disrupted by structures mostly related to the Walker Lane structural belt.
These structures provide conduits for mineralizing fluids and often subsequently
disrupt mineralized zones.

The oldest rocks belong to the middle to late Triassic age
Luning Formation, consisting predominately of dolomite, dolomitic limestone and
limestone with minor shale, argillite and conglomerate. Project mapping and
logging of drill holes indicate this sequence is approximately 2000 thinner in
the Project area than its regionally mapped thickness of more than 10,000 feet.
The Luning limestones are thin to medium bedded and intercalated with siltstones
in the bottom 1000 feet of the sequence, and massive to thick bedded in the top
4000 feet of the sequence.

The late Triassic age Gabbs Formation conformably overlies the
Luning Formation. The Gabbs Formation consists of three members: a thin bedded
fossiliferous limestone, argillaceous limestone, and calcareous tuffaceous
siltstone. The type locality of the Gabbs Formation is in New York Canyon, where
its thickness is measured as 400 feet, but drill logs indicate it is up to 650
feet thick.

The Jurassic age Sunrise Formation conformably overlies the
Gabbs Formation. The Sunrise Formation consists of five members with quartz
latite porphyry flows near the base overlain by thin bedded limestones,
siltstones, silty limestone, tuffaceous siltstone, shale and claystone totaling
about 800 feet in thickness in the New York Canyon area.

The Jurassic age Dunlap Formation conformably overlies the
Sunrise Formation. The Dunlap Formation is a 3000-foot thick sequence of basal
conglomerate, limestones, clastic sediments, and volcanic flows of andesitic and
rhyolitic composition.

The strata of New York Canyon are intruded by Jurassic to
Cretaceous age multiphase domes, plugs, dikes and sills consisting primarily of
diorite and granodiorite with areas of quartz monzonite, granite and other
associated felsic rock types.

Numerous Tertiary age units (mostly Oligocene and Miocene age)
consisting of mafic to felsic volcanics, volcanoclastics, flows, tuffs,
tuffaceous sediments, and continental sediments locally overlie the older rocks.
These lithologies are of varying thicknesses ranging from 100s of feet to more
than 1000 feet.

Quaternary age deposits consisting of various alluvial and
lacustrine sediments comprise the youngest units in the area and fill the valley
bottoms and form pediments along the range fronts. These young units may be 200
feet or more thick.

Property Geology at New York Canyon

The upper New York Canyon area consists primarily of the Luning
Formation which is overlain by the Gabbs and Sunrise Formations in the Longshot
Ridge area. The Luning Formation exposed beneath the Longshot Ridge area consists of gray to tan colored, thickbedded limestone and
dolomite. Felsic sills and dikes intrude all units in the area.

16

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The Gabbs Formation at Longshot Ridge is extremely
calc-silicate altered. It was originally a very thin bedded to laminated
limestone and silty limestone intercalated with siltstone and shale. The Gabbs
Formation is comprised of three members: (#1) the lowest member, which is 250
feet thick, consisting of thick black bioclastic limestone intercalated with
siltstone, (#2) the middle member, 200 feet thick, consisting of predominately
argillaceous limestone intercalated with calcareous and tuffaceous siltstone,
and (#3) the upper member, from 0 to 200 feet thick, consisting of argillaceous
limestone intercalated with siltstone. The black bioclastic carbonaceous
limestone at the base of the Gabbs Formation is a distinct unit which provides a
clear marker for the contact with the underlying Luning Formation.

The two lowest members of the Sunrise Formation at Longshot
Ridge are also calcsilicate altered. The Sunrise consists of five members: (#1)
the lowest member, 100 feet thick, consisting of argillaceous limestone
intercalated with siltstone and some quartz latite porphyry flows near the base,
overlain by (#2), 50 feet thick, consisting of thick-bedded fossiliferous
limestone intercalated with siltstone and silty limestone, overlain by (#3), 250
feet thick, consisting of shale and siltstone, overlain by (#4), 200 feet thick,
consisting of silty limestone and limestone, and capped by (#5), 200 feet thick,
consisting of claystone and limestone.

The Dunlap formation, mentioned in the previous description of
regional geology, is not present in the Longshot Ridge area. Similarly, only one
of the Tertiary-age volcanic sequences exists along the flank of Longshot Ridge.

The intrusive rocks (Fi) on Longshot Ridge are primarily sills
with some local dikes. Rock types mapped at the surface and encountered in drill
holes consist of granodiorite porphyry, porphyritic quartz monzonite, quartz
monzonite porphyry and quartz-feldspar porphyry. These sills and dikes are
typically only 5 to 20 feet thick but are relatively common throughout the area.

Rock strata on Longshot Ridge average N75°E in strike dip about
35°. The rocks are severely faulted and folded. Drag and overturned features are
common. The major faults are curvilinear with fairly high dip angles that
commonly change along the strike of the structure. The faults generally trend
either northeast or northwest, but there are some local faults that strike north
and dip steeply east. For the most part, the faults appear to have normal
displacements ranging from 50 to 200 feet.

Deposit Types at New York Canyon Project

Mineralization in the New York Canyon Project occurs
principally as contact metasomatic copper skarn deposits and as possible copper
porphyry deposits within intrusive bodies at depth beneath the skarns.

Contact metasomatic deposits include a variety of types such as
those that are copper-rich, ironrich, tungsten-rich, etc. The deposits are
commonly referred to as skarns when rich in copper and tactites when rich in
tungsten. Minerals associated with the copper-rich skarn deposits typically
include chalcopyrite, bornite, magnetite, specularite, pyrite, pyrrhotite,
sphalerite, and molybdenite. Alteration associated with the skarn deposits
converts limestone and limy sediments to higher temperature calc-silicate
minerals consisting of garnet, epidote, diopside, tremolite and calcite.

Skarn deposits are always adjacent to small to moderate sized
intrusive bodies of intermediate composition such as monzonite and granodiorite.
These intrusive bodies  occurring mainly as sills, dikes, plugs or stocks  are
the sources for the mineralizing and altering hydrothermal fluids and for the
heat that drives the fluids. Skarn mineralization develops along specific
altered beds of carbonate rock in zones of strong deformation or faulting
adjacent to the intrusive bodies.

The New York Canyon copper skarns closely fit these
descriptions. The skarns either consist mostly of oxidized minerals, as at
Longshot Ridge, or they consist of both oxidized and sulfide minerals as at the
Champion prospect west of Longshot Ridge.

Skarn type copper deposits are occasionally associated with
larger intrusive bodies that are hosts for porphyry type copper-molybdenum
deposits, such as the major Carr Fork copper skarns associated with the
world-class Bingham Canyon porphyry copper deposit in Utah. Sizes can range from
10 million to 100 million tons or more with grades of 1% to 2% Cu. Associated metallic minerals
include chalcopyrite, bornite, magnetite, specularite, pyrite, pyrrhotite,
sphalerite, and molybdenite. Other examples of significant skarn deposits
associated with large porphyry-copper deposits include Santa Rita-Pinos Altos in
New Mexico, Mason Valley-Copper Canyon in Nevada, and Mission-Pima in Arizona.

17

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Porphyry-type copper-molybdenum deposits are closely associated
with and related to moderate sized intrusive rock bodies of intermediate to
felsic composition. Porphyry-type mineralization consists of disseminated
sulfides and crosscutting stockwork quartz-sulfide veins or veinlets occurring
within the intrusive body and extending outward into the surrounding rocks. The
intrusive bodies are commonly 0.3 to 1 mile or more across and their emplacement
produces large volumes of altered and intensely fractured ground.

At Copper Queen, the westernmost New York Canyon target, known
mineralization, incompletely explored to date, consists of both non-oxidized
copper sulfide skarns and potential porphyry-type copper-molybdenum sulfides in
the underlying intrusive body. The porphyry mineralization remains an
exploration target of possible large size based on (1) the widespread
occurrences of oxide copper showings on the surface, (2) limited geophysical
surveys, (3) apparent doming of the overlying sediments, and (4) the districts
location within the Walker Lane structural belt which hosts several large
porphyry systems such as Yerington to the northwest and Hall Mountain to the
southeast. Exploration targets for the project might range from 150 million to
400 million tons as grades of 0.4% to 0.5% copper with possible credits in
molybdenum.

Mineralization at New York Canyon Project

Mineralization in the New York Canyon Project consists of three
principal copper target areas: Longshot Ridge on the east, Champion in the
center, and Copper Queen on the west. These target areas are aligned along a
west-northwest trend that probably reflects deeper basement structures.

The Longshot Ridge and Champion prospects both contain numerous
widespread showings of copper skarn mineralization exposed in surface outcrops
and in old mine workings. In contrast, the Copper Queen prospect has no exposed
mineralization at the surface but contains copper sulfide skarn at depth and an
incompletely tested copper-molybdenum sulfide porphyry system at greater depth.
Recent exploration in the New York Canyon Project has focused mainly on the
extensive oxide copper skarn mineralization at Longshot Ridge. This
mineralization is the subject of this report.

Hydrothermal alteration and mineralization at Longshot Ridge
has formed copper-rich skarn in porous and permeable zones within sedimentary
rock strata of the Luning, Gabbs and Sunrise Formations. Additionally
copper-rich stockwork veinlets in permeable fractures occur in some of the
felsic porphyry intrusive dikes and sills that intrude the rock strata. The
alteration associated with the intrusive bodies consists of argillization,
phyllic, and silicification which are typical for rocks of this type.

The oxide copper minerals abundantly present at Longshot Ridge
are apparently products of the supergene weathering and oxidation of primary
copper sulfide minerals which were present in the original skarn. The copper
mineralization consists almost entirely of secondary copper minerals,
principally malachite, azurite, chrysocolla and copper wad. Additionally, some
copper-rich limonite (goethite) is reported. A fairly common greenish clay
alteration mineral is thought to be a zinc-bearing clay. Because limestones tend
to buffer the solutions that carry copper in a supergene environment, the copper
weathered from sulfides in the skarn migrates to the non-skarn limestone units
where it may be enriched by as much as 300 to 400 percent.

About 90 percent of the Longshot Ridge mineralization is within
the two upper units of the Gabbs Formation. Drilling results indicate that the
strongest, thickest and most continuous mineralization occurs in a
northeast-trending zone, 200 feet wide by 1300 feet long, which is crossed by
two northwest-trending structurally-controlled high grade zones, each about 100
feet wide and from 400 to 700 feet long. Mineralization in these trends is from
100 feet to 200 feet thick and covers an area of 500,000 square feet down to a
depth of 350 feet, using a 0.30% Cu/ft cutoff. Within this area are many smaller
higher-grade zones. A comparison of adjacent holes and twins of previously
drilled holes indicates this copper mineralization has good continuity.

The copper skarns and supergene enriched zones are relatively
flat lying to only gently dipping (less than 30o dip to the south). For this
reason, the thicknesses of mineralization intersected by the vertical holes
drilled to test this system represent the approximate true thicknesses of the
mineralization.

18

---

Lunig Formation -these carbonates consist primarily of
dolomite and limestone. Alteration associated with these rocks includes a skarn
mineral suite consisting primarily of serpentine, talc, garnet, magnetite, and
locally diopside. The serpentine and talc minerals in skarn form sinuous veins
along the structures within the dolomite and are very diagnostic of skarn
formation in dolomite. Due to the massive nature of the Luning Formation, the
altering and mineralizing solutions closely followed high-angle cross-cutting
structures and formed limited skarn halos with only small areas of moderately
high grade copper ineralization.

The Luning also has some small local zones of hematite and
dolomite containing jasperoid veins a few feet thick. These consist of
fine-grained silica, hematite, goethite, limonite and copper oxides.
Historically, all the higher-grade copper shipped from this district during
World War I was from the copper skarns in the Luning, not from the copper skarns
in the Gabbs.

Gabbs FormationThe principal host for
the Longshot Ridge copper skarn deposits are impure thin-bedded sandy limestone
and siltstone in the upper two units of the Gabbs Formation. The alteration
associated with these rocks is either a skarn mineral suite consisting of
garnet, diopside and magnetite in the limestone, or is hornfels developed in the
siltstone. The copper mineralization is much more widespread, but lower grade
for the reasons stated in the previous Luning skarn description. The
diopside-rich Gabbs skarns are more abundantly fractured and mineralized due to
the brittle nature of diopside, and for this reason these skarns are slightly
higher grade than the garnet-rich skarn. Commonly the Gabbs skarns are only a
few feet thick (5 to 15 feet), but there are many of them.

The lowest Gabbs unit, a carbonaceous bioclastic limestone, is
the location of the marble line, which is the alteration boundary between
marbleized and calc-silicate altered limestone. This unit rarely forms skarns.
The upper two units are hosts for the plentiful skarns and hornfels formed when
the hydrothermal solutions traveled up structures and outward along permeable
units. These same structures and permeable beds were later intruded by
granodiorite porphyry dikes and sills. The intrusive bodies proximal to the
skarns are most commonly sills but dikes are locally present.

Sunrise FormationThe two lowest
sedimentary units of the Sunrise Formation are impure thin-bedded sandy
limestone and siltstone which are altered and mineralized. The alteration occurs
as either a skarn mineral suite consisting of garnet, diopside and magnetite in
the limestone, or as hornfels developed in the siltstone. The copper
mineralization is much more widespread, but lower grade for the reasons stated
above in the previous Luning skarn description. The diopside-rich skarns are
more abundantly fractured and mineralized due to the brittle nature of diopside
and for this reason these skarns are slightly higher grade than the garnet-rich
skarns. The skarns in the Sunrise Formation are commonly very thick (50 feet).
The largest of these is the Mayflower Mine, which was mined on a fairly large
scale. This thick skarn is capped by a thick hornfels.

Canadian National Instrument 43-101 Mineral Resource
Estimate

We completed a Canadian National Instrument 43-101 mineral
resource estimate (mineralized material under SEC Industry Guide 7) on the
Longshot Ridge copper skarn deposit at the New York Canyon Project. The resource
estimate was completed by Gary Giroux, P. Eng., of Giroux Consultants Ltd.,
using industry standard methods that conform with Canadian Institute of Mining,
Metallurgy and Petroleum (CIM) Definition Standards on Mineral Resources and
Mineral Reserves referred to in National Instrument 43-101 - Standards of
Disclosure for Mineral Projects. A copy of the National Instrument 43-101
Technical Report is available on SEDAR at www.sedar.com.

The mineral resource estimate is based on 58 historical drill
holes and 38 drill holes completed by the Company during the period from 2004 to
2005. This data was complemented with samples from 34 surface trenches and road
cuts obtained from Longshot Ridge by previous exploration operators. The mineral
resource estimate did not incorporate a further 33 drill holes (7 HQ diamond
drill holes and 26 reverse circular holes) completed by the Company in 2006. Our
consulting geologists have recommended that the 2006 drilling program be
re-assayed prior to being incorporated into a mineral resource estimate.

Using CIM definition standards, at a cut off grade of 0.20% Cu,
total indicated resources of 16,250,000 tons at an average grade of 0.43% Cu and
inferred resources of 2,900,000 tons at an average grade of 0.31% of Cu. Cautionary Note to U.S. Investors. Mineral
resources are not mineral reserves and there is no assurance that any mineral
resources will ultimately be reclassified as proven or probable reserves.
Mineral resources which are not mineral reserves do not have
demonstrated economic viability. U.S. Investors should read the Cautionary Note
to U.S. Investors Regarding Reserve and Resource Estimates above concerning the
difference between resources and reserves.

19

---

Current Exploration Program

Due to insufficient financing, we did not conduct any
exploration work on our New York Canyon Project during the year ended June 30,
2010. Our exploration program for the New York Canyon Project involves the
following:

| | - | Re-analysis of 2006 Longshot Ridge drill pulps, duplicate
      samples, blank samples and standards by an independent laboratory to
      determine the correct copper values;
| | - | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | - | Acquiring representative mineralized material at Longshot
      Ridge for metallurgical testwork samples to determine the optimal copper
      beneficiation process;          
| | - | Initiate environmental base line studies for permitting
      advanced exploration.                                                                                            

We anticipate this exploration program will cost approximately
$600,000. Our ability to complete our exploration program of the New York Canyon
Project is subject to our obtaining substantial financing, of which there is no
assurance.

ITEM
3.             LEGAL
PROCEEDINGS.

On January 29, 2007, we received a statement of claim filed in
the Ontario Superior Court of Justice from a company claiming unpaid investor
relations fees of $25,916 and requesting the balance of an alleged retainer of
$84,000. Canyon Copper is vigorously disputing this claim and believes this
action is without merit.

20

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PART II

|ITEM 5. | MARKET FOR REGISTRANTS COMMON EQUITY, RELATED
      STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES.
|------- | -------------------------------------------------------------------------------------------------------------------

MARKET INFORMATION

Quotations for our common stock are currently on the
Over-The-Counter Bulletin Board (the OTC Bulletin Board) under the symbol
"CNYC." The following is the high and low bid information for our common stock
during each fiscal quarter of our last two fiscal years.

FISCAL QUARTER
    HIGH ($)
    LOW ($)1stQuarter 2009
    0.45
    0.122ndQuarter 2009
    0.18
    0.013rdQuarter 2009
    0.04
    0.0154thQuarter 2009
    0.10
    0.0151stQuarter 2010
    0.2
    0.052ndQuarter 2010
    0.10
    0.053rdQuarter 2010
    0.085
    0.034thQuarter 2010
    0.03
    0.03


The above quotations have been adjusted to reflect our 1-for-3
reverse stock split effective May 15, 2009. Quotations entered on the OTC
Bulletin Board reflect inter-dealer prices, without retail mark-up, markdown or
commission and may not represent actual transactions.

HOLDERS OF OUR COMMON STOCK

As of September 21, 2010, we had 89 registered stockholders
holding 78,390,307 of our issued and outstanding common stock.

DIVIDENDS

There are no restrictions in our Articles of Incorporation or
Bylaws that prevent us from declaring dividends. Our governing statutes, Chapter
78 of the Nevada Revised Statutes, however, do prohibit us from declaring
dividends where, after giving effect to the distribution of the dividend:

|(a) | We would not be able to pay our debts as they become due
      in the usual course of business; or                                                                                                                                          
|--- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|    |                                                                                                                                                                                                                                             
|(b) | Our total assets would be less than the sum of our total
      liabilities plus the amount that would be needed to satisfy the rights of
      stockholders who have preferential rights superior to those receiving the
      distribution.

We have not declared any dividends and we do not plan to
declare any dividends in the foreseeable future.

RECENT SALES OF UNREGISTERED SECURITIES

All unregistered sales of our equity securities made during the
fiscal year ended June 30, 2010 have been previously reported in our Quarterly
Reports on Form 10-Q and our Current Reports on Form 8-K.

21

---

ITEM 7.
    MANAGEMENT'S DISCUSSION
      AND ANALYSIS OF FINANCIAL CONDITION
      AND RESULTS OF OPERATIONS.


PLAN OF OPERATION

Over the next twelve months, our plan of operation is to
re-analyze the 2006 Longshot Ridge drill pulps and to initiate environmental
base line studies, which will permit us to conduct advanced exploration if
warranted. In order to implement our exploration program and to continue our
operations, we anticipate that we will require the following:

ITEM AND ACTIVITY
    12 Month Total
      BudgetLAND STATUS2011 - 2012 unpatented claim maintenance fees
    $                   
       195,000Monthly Payments  Patented Claims
    72,000EXPLORATION PROGRAMRe-assay 2006 Longshot Ridge drill pulps
    180,000Metallurgical sampling and testing
    125,000Environmental base line study work
    85,000Geological mapping
    30,000Filed supplies and support
    30,000Management fee
    50,000Contingency
    55,000GENERAL AND ADMINISTRATIVE EXPENSESGeneral and Administrative
    120,000TOTAL
    $                     942,000


As at June 30, 2010, we had cash of $252,918 and, for the next
twelve months, management anticipates that the minimum cash requirements to fund
our proposed exploration program and our continued operations will be $942,000.
We do not have sufficient funds to meet our planned expenditures over the next
twelve months and will need to seek financing to meet our planned expenditures.
However, there is no assurance we will be successful in raising the necessary
funding or on terms that are acceptable to us. Since inception, we have been
dependent on investment capital and debt financing from third parties as our
primary source of liquidity. We anticipate continuing to rely on sales of shares
of our common stock and loans in order to continue to fund our business
operations. Issuances of additional shares will result in further dilution of
our existing shareholders.

RESULTS OF OPERATIONS

Summary of Year End Results

|                       |   | Year Ended June 30 |  
|---------------------- | - | ------------------ | -
|                       |   |                    |  
|                       |   | 2010               |  
|Revenue                | $ | -                  |  
|Operating Expenses     |   | (1,056,103         | )
|Other Income (Expense) |   | (1,169             | )
|Net Loss               | $ | (1,057,272         | )

Revenue

We have not earned any revenues to date and do not anticipate
earning revenues until such time as we enter into commercial production of our
mineral properties. There can be no assurance that we will be successful in
discovering commercial quantities or that we can commercially produce metals or
minerals. We are presently an exploration stage company engaged in the search
for mineral reserves. We can provide no assurances that we will be able to
discover any commercially exploitable levels of mineral resources on our
property, or, even if such resources are discovered, that we will be able to
enter into commercial production of our mineral properties.

22

---

Expenses

The major components of our expenses for the year are outlined
in the table below:

|                                            |   | Year Ended June 30 | 
|------------------------------------------- | - | ------------------ | 
|                                            |   |                    | 
|                                            |   | 2010               | 
|Operating expenses:                         |   |                    | 
|Foreign exchange loss (gain)                | $ | 29,448             | 
|General and administrative                  |   | 716,684            | 
|Mineral exploration costs                   |   | 309,971            | 
|Sub-total                                   | $ | 1,056,103          | 
|Other (income) expenses:                    |   |                    | 
|Accretion of discounts on convertible debt  | $ | -                  | 
|Gain on change in fair values of derivative |   | -                  | 
|liability                                   |   |                    | 
|Interest expense                            |   | 1,169              | 
|Debt conversion expense                     |   | -                  | 
|Loss of extinguishments of debt             |   | -                  | 
|Recovery on investment securities           |   | -                  | 
|Gain on write-off of accounts payable       |   | -                  | 
|Sub-total                                   | $ | 1,169              | 
|Total Expenses                              | $ | 1,057,272          | 

Our operating expenses increased from $588,020, during the year
ended June 30, 2009, to $1,056,103, during the year ended June 30, 2010. The
increase in our operating expenses is due to increases in general and
administrative expenses, mineral exploration expenses and foreign exchange loss.

General and administration expenses primarily consisted of: (i)
consulting fees incurred for services provided by our executive officers; (ii)
stock based compensation expenses; and (iii) legal and accounting fees in
connection with meeting our ongoing reporting requirements under the Exchange
Act. The significant increase in general and administrative expenses in fiscal
2010 is due to the fact that we recorded a stock-based compensation of $362,614.

Mineral exploration costs consisted of annual payments to
maintain the New York Canyon Project in good standing, mineral lease payments
and consulting fees in connection with our New York Canyon Project.

The decrease in our net loss is primarily a result of the fact
that we experienced a debt conversion expense of $2,010,076 in fiscal 2009. The
debt conversion expense is related to the issuance of 19,637,947 units to settle
an outstanding indebtedness of $785,518.

We anticipate that our expenses will increase over the next
twelve months due to our ongoing planned exploration activities on the New York
Canyon Project.

LIQUIDITY AND CAPITAL RESOURCES

Working Capital

|                        |   |                        |   |   |                        |   |  | Percentage          | 
|----------------------- | - | ---------------------- | - | - | ---------------------- | - |  | ------------------- | 
|                        |   | At
      June 30, 2010 |   |   | At
      June 30, 2009 |   |  | Increase / Decrease | 
|Current Assets          | $ | 256,918                |   | $ | 427,896                |   |  | (40.0)%             | 
|Current Liabilities     |   | (437,523               | ) |   | (539,492               | ) |  | (18.9)%             | 
|Working Capital Deficit | $ | (180,605               | ) | $ | (111,596               | ) |  | 61.8%               | 

23

---

|Cash Flows                                            |   |                     |   |   |                     |  
|----------------------------------------------------- | - | ------------------- | - | - | ------------------- | -
|                                                      |   | Year Ended          |   |   | Year Ended          |  
|                                                      |   | June
      30, 2010 |   |   | June
      30, 2009 |  
|Cash Flows used in Operating
      Activities         | $ | (709,687            | ) | $ | (665,989            | )
|Cash Flows used in Investing Activities               |   | -                   |   |   | 14,809              |  
|Cash Flows provided by
      Financing Activities     |   | 535,489             |   |   | 1,062,716           |  
|Net Increase (decrease) in Cash During the
      Year | $ | (174,198            | ) | $ | 411,536             |  

The increase in our working capital deficit from $111,596, as
at June 30, 2009, to $180,605, as at June 30, 2010, was primarily a result of an
a decrease in cash in order to meet ongoing operating expenses and to decrease
our accounts payable and liabilities.

During the year ended June 30, 2010, we completed the following
equity financings:

|(a) | On August 10, 2009, we issued 12,850,000 shares of our
      common stock for proceeds of $514,000; and
|--- | -------------------------------------------------------------------------------------------------------
|    |                                                                                                        
|(b) | On August 31, 2009, we issued 1,375,000 shares of our
      common stock for proceeds of $55,000.      

Future Financings

Our plan of operation calls for significant expenses in
connection with the exploration of the New York Canyon Project and requires us
to obtain financing. We recorded a net loss of $1,057,272 for the year ended
June 30, 2010 and have an accumulated deficit of $20,985,487 since inception. As
at June 30, 2010, we had cash of $252,918 and, for the next twelve months,
management anticipates that the minimum cash requirements to fund our proposed
exploration program and our continued operations will be $942,000. Accordingly,
we do not have sufficient funds to meet our planned expenditures over the next
twelve months and will need to seek financing to meet our planned expenditures.
There is no assurance that we will be able to obtain financing in the future.

Obtaining financing is subject to a number of factors,
including the market prices for the mineral property and copper. These factors
may make the timing, amount, terms or conditions of additional financing
unavailable to us. Since our inception, we have used our common stock to raise
money for our operations and for our property acquisitions. We have not attained
profitable operations and are dependent upon obtaining financing to pursue our
plan of operation. For these reasons, our independent auditors believe there
exists a substantial doubt about our ability to continue as a going concern.

OFF-BALANCE SHEET ARRANGEMENTS

None.

CRITICAL ACCOUNTING POLICIES

We have identified certain accounting policies, described
below, that are most important to the portrayal of our current financial
condition and results of operations. Our significant accounting policies are
disclosed in Note 2 to our audited financial statements included in this Annual
Report for the year ended June 30, 2010.

24

---

Mineral Property Costs

We have been in the exploration stage since our inception on
January 21, 2000 and have not yet realized any revenues from our planned
operations. We are primarily engaged in the acquisition and exploration of
mining properties. Mineral property exploration costs are expensed as incurred.
Mineral property acquisition costs are initially capitalized. We assess the
carrying costs for impairment under ASC 360, Property, Plant, and Equipment at
each fiscal quarter end. When we have been determined that a mineral property
can be economically developed as a result of establishing proven and probable
reserves, the costs then incurred to develop such property, are capitalized.
Such costs will be amortized using the units-of-production method over the
estimated life of the probable reserve. If mineral properties are subsequently
abandoned or impaired, any capitalized costs will be charged to operations.

Long-Lived Assets

In accordance with ASC 360, Property Plant and
Equipment, we test long-lived assets or asset groups for recoverability when
events or changes in circumstances indicate that their carrying amount may not
be recoverable. Circumstances which could trigger a review include, but are not
limited to: significant decreases in the market price of the asset; significant
adverse changes in the business climate or legal factors; accumulation of costs
significantly in excess of the amount originally expected for the acquisition or
construction of the asset; current period cash flow or operating losses combined
with a history of losses or a forecast of continuing losses associated with the
use of the asset; and current expectation that the asset will more likely than
not be sold or disposed significantly before the end of its estimated useful
life. Recoverability is assessed based on the carrying amount of the asset and
its fair value which is generally determined based on the sum of the
undiscounted cash flows expected to result from the use and the eventual
disposal of the asset, as well as specific appraisal in certain instances. An
impairment loss is recognized when the carrying amount is not recoverable and
exceeds fair value.

Stock-Based Compensation

We record stock-based compensation in accordance with ASC 718,
Compensation  Stock Based Compensation and ASC 505, Equity Based Payments to
Non-Employees, which requires the measurement and recognition of compensation
expense based on estimated fair values for all share-based awards made to
employees and directors, including stock options.

ASC 718 requires companies to estimate the fair value of
share-based awards on the date of grant using an option-pricing model. We use
the Black-Scholes option-pricing model as its method of determining fair value.
This model is affected by our stock price as well as assumptions regarding a
number of subjective variables. These subjective variables include, but are not
limited to our expected stock price volatility over the term of the awards, and
actual and projected employee stock option exercise behaviours. The value of the
portion of the award that is ultimately expected to vest is recognized as an
expense in the statement of operations over the requisite service period.

All transactions in which goods or services are the
consideration received for the issuance of equity instruments are accounted for
based on the fair value of the consideration received or the fair value of the
equity instrument issued, whichever is more reliably measurable.

25

---

ITEM
8.            
FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA.

Index to Financial Statements

|1. | Report
      of Independent Registered Public Accounting Firm (Saturna Group Chartered
      Accountants LLP);                  
|-- | --------------------------------------------------------------------------------------------------------------------------------
|   |                                                                                                                                 
|2. | Report
      of Independent Registered Public Accounting Firm (Manning Elliott LLP);                                            
|   |                                                                                                                                 
|3. | Balance
      Sheets as at June 30, 2010 and 2009;                                                                              
|   |                                                                                                                                 
|4. | Statements
      of Operations for the years ended June 30, 2010 and 2009 and accumulated
      from inception to June 30, 2010;
|   |                                                                                                                                 
|5. | Statements
      of Cash Flows for the years ended June 30, 2010 and 2009 and accumulated
      from inception to June 30, 2010;
|   |                                                                                                                                 
|6. | Statement
      of Stockholders Equity (Deficit) for the period from inception to June
      30, 2010; and                     
|   |                                                                                                                                 
|7. | Notes
      to the Financial Statements.                                                                                        

26

---

Canyon Copper Corp.
  (An Exploration Stage Company) 
  June
  30, 2010 
(Expressed in U.S. dollars)

|                                                              | Index
|------------------------------------------------------------- | -----
|                                                              |      
|Report of Independent
      Registered Public Accounting Firm | F1  
|                                                              |      
|Report of Independent
      Registered Public Accounting Firm | F2  
|                                                              |      
|Balance Sheets                                                | F3  
|                                                              |      
|Statements of
      Operations                                | F4  
|                                                              |      
|Statement of
      Stockholders Equity (Deficit)             | F5  
|                                                              |      
|Statements of Cash
      Flows                                | F10 
|                                                              |      
|Notes to the Financial
      Statements                       | F11 

---



REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To the Board of Directors and Stockholders of 
  Canyon Copper
  Corp. 
  (An Exploration Stage Company)

We have audited the accompanying balance sheet of Canyon Copper
  Corp. (An Exploration Stage Company) as of June 30, 2010, and the related
  statements of operations, stockholders equity (deficit), and cash flows for the
  year then ended and accumulated from July 1, 2009 to June 30, 2010. 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 the standards of the
  Public Company Accounting Oversight Board (United States). Those standards
  require that we plan and perform the audit to obtain reasonable assurance about
  whether the financial statements are free of material misstatement. An audit
  includes examining, on a test basis, evidence supporting the amounts and
  disclosures in the financial statements. The Company is not required to have,
  nor were we engaged to perform, an audit of its internal control over financial
  reporting. An audit includes consideration of internal control over financial
  reporting as a basis for designing audit procedures that are appropriate in the
  circumstances, but not for the purpose of expressing an opinion on the
  effectiveness of internal control over financial reporting. Accordingly, we
  express no such opinion. An audit also includes assessing the accounting
  principles used and significant estimates made by management, as well as
  evaluating the overall financial statement presentation. We believe that our
  audit provides a reasonable basis for our opinion.

In our opinion, the financial statements referred to above
  present fairly, in all material respects, the financial position of the Company
  as of June 30, 2010, and the results of its operations and its cash flows for
  the year then ended and accumulated from July 1, 2009 to June 30, 2010, in
  conformity with accounting principles generally accepted in the United States.

The accompanying financial statements have been prepared
  assuming the Company will continue as a going concern. As discussed in Note 1 to
  the financial statements, the Company has not generated any revenues, has a
  working capital deficit, and has incurred operating losses since inception.
  These factors raise substantial doubt about the Companys ability to continue as
  a going concern. Managements plans in regard to these matters are also
  discussed in Note 1 to the financial statements. The financial statements do not
  include any adjustments that might result from the outcome of this uncertainty.

/s/ SATURNA GROUP CHARTERED ACCOUNTANTS LLP

Saturna Group Chartered Accountants LLP

Vancouver, Canada

September 24, 2010

---



Report of Independent Registered Public Accounting
  Firm

To the Stockholders and Directors 
  of Canyon Copper
  Corp.
  (An Exploration Stage Company)

We have audited the accompanying balance sheets of Canyon
  Copper Corp. (An Exploration Stage Company) as of June 30, 2009 and the related
  statements of operations, cash flows and stockholders deficit for the years
  then ended and accumulated for the period from January 21, 2000 (Date of
  Inception) to June 30, 2009. 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 audits.

We conducted our audits in accordance with the standards of the
  Public Company Accounting Oversight Board (United States). Those standards
  require that we plan and perform the audits to obtain reasonable assurance about
  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. The Company is not required to have,
  nor were we engaged to perform, an audit of its internal control over financial
  reporting. An audit includes consideration of internal control over financial
  reporting as a basis for designing audit procedures that are appropriate in the
  circumstances, but not for the purpose of expressing an opinion on the
  effectiveness of internal control over financial reporting. Accordingly, we
  express no such opinion. 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, the financial statements referred to above
  present fairly, in all material respects, the financial position of Canyon
  Copper Corp. (An Exploration Stage Company), as of June 30, 2009 and the results
  of its operations and its cash flows for the years then ended and accumulated
  for the period from January 21, 2000 (Date of Inception) to June 30, 2009, in
  conformity with generally accepted accounting principles used in the United
  States.

The accompanying financial statements have been prepared
  assuming the Company will continue as a going concern. As discussed in Note 1 to
  the financial statements, the Company has not generated any revenue, has a
  working capital deficit and has incurred significant operating losses since
  inception. These factors raise substantial doubt about the Companys ability to
  continue as a going concern. Managements plans in regard to these matters are
  also discussed in Note 1. The financial statements do not include any
  adjustments that might result from the outcome of this uncertainty.

/s/ MANNING ELLIOTT LLP

CHARTERED ACCOUNTANTS

Vancouver, Canada

September 22, 2009

---

Canyon Copper Corp. 
  (An Exploration Stage Company) 
  Balance Sheets 
  (Expressed in U.S. dollars)

|                                                                                                                                                                   |  | June 30,    |   |  | June 30,    |  
|------------------------------------------------------------------------------------------------------------------------------------------------------------------ |  | ----------- | - |  | ----------- | -
|                                                                                                                                                                   |  | 2010        |   |  | 2009        |  
|                                                                                                                                                                   |  | $           |   |  | $           |  
|ASSETS                                                                                                                                                             |  |             |   |  |             |  
|Current Assets                                                                                                                                                     |  |             |   |  |             |  
|Cash                                                                                                                                                               |  | 252,918     |   |  | 427,116     |  
|Prepaid expenses and deposits                                                                                                                                      |  | 3,351       |   |  | 780         |  
|Total Assets                                                                                                                                                       |  | 256,269     |   |  | 427,896     |  
|                                                                                                                                                                   |  |             |   |  |             |  
|LIABILITIES AND STOCKHOLDERS DEFICIT                                                                                                                              |  |             |   |  |             |  
|Current Liabilities                                                                                                                                                |  |             |   |  |             |  
|Accounts payable (Note 5)                                                                                                                                          |  | 142,655     |   |  | 257,864     |  
|Accrued liabilities (Note 4)                                                                                                                                       |  | 2,288       |   |  | 24,295      |  
|Due to related parties (Note 5)                                                                                                                                    |  | 292,580     |   |  | 257,333     |  
|Total Liabilities                                                                                                                                                  |  | 437,523     |   |  | 539,492     |  
|Nature of Operations and Continuance of
      Business (Note 1)                                                                                                    |  |             |   |  |             |  
|Contingent Liability (Note 10)                                                                                                                                     |  |             |   |  |             |  
|Subsequent Event (Note 13)                                                                                                                                         |  |             |   |  |             |  
|Stockholders Deficit                                                                                                                                              |  |             |   |  |             |  
|Preferred
      stock 
         Authorized: 100,000,000 shares, par value
      $0.00001 
       Issued and outstanding: 500,000 shares                            |  | 5           |   |  | 5           |  
|Common stock 
         Authorized:
      166,666,666 shares, par value $0.00001 
         Issued
    and outstanding: 78,390,080 shares (2009  64,165,080 shares) |  | 784         |   |  | 642         |  
|Additional paid-in capital                                                                                                                                         |  | 20,803,444  |   |  | 19,871,972  |  
|Stock subscriptions receivable                                                                                                                                     |  |            |   |  | (56,000     | )
|Deficit accumulated during the exploration stage                                                                                                                   |  | (20,985,487 | ) |  | (19,928,215 | )
|Total
      Stockholders Deficit                                                                                                                                  |  | (181,254    | ) |  | (111,596    | )
|Total Liabilities and Stockholders Deficit                                                                                                                        |  | 256,269     |   |  | 427,896     |  

(The accompanying notes are an integral part of these financial
  statements)

F-3

---

Canyon Copper Corp. 
  (An Exploration Stage Company) 
  Statements of Operations 
  (Expressed in U.S. dollars)

|                                                            |  |            |   |  |                     |   |  | Accumulated from |  
|----------------------------------------------------------- |  | ---------- | - |  | ------------------- | - |  | ---------------- | -
|                                                            |  |            |   |  |                     |   |  | January 21, 2000 |  
|                                                            |  | Year Ended |   |  | (date of inception) |  
|                                                            |  | June 30,   |   |  | to June 30,         |  
|                                                            |  | 2010       |   |  | 2009                |   |  | 2010             |  
|                                                            |  | $          |   |  | $                   |   |  | $                |  
|                                                            |  |            |   |  |                     |   |  |                  |  
|Revenue                                                     |  |           |   |  |                    |   |  |                 |  
|                                                            |  |            |   |  |                     |   |  |                  |  
|Operating Expenses                                          |  |            |   |  |                     |   |  |                  |  
|                                                            |  |            |   |  |                     |   |  |                  |  
|Depreciation                                                |  |           |   |  |                    |   |  | 5,540            |  
|Foreign exchange loss (gain)                                |  | 29,448     |   |  | (39,133             | ) |  | (24,481          | )
|General and administrative
      (Note 5)                   |  | 716,684    |   |  | 370,402             |   |  | 9,469,394        |  
|Impairment of mineral property costs                        |  |           |   |  |                    |   |  | 2,759,130        |  
|Impairment of property
      and equipment                  |  |           |   |  |                    |   |  | 10,811           |  
|Mineral exploration costs (Note 5)                          |  | 309,971    |   |  | 256,751             |   |  | 4,925,473        |  
|                                                            |  |            |   |  |                     |   |  |                  |  
|Total Operating Expenses                                    |  | 1,056,103  |   |  | 588,020             |   |  | 17,145,867       |  
|                                                            |  |            |   |  |                     |   |  |                  |  
|Operating Loss                                              |  | (1,056,103 | ) |  | (588,020            | ) |  | (17,145,867      | )
|                                                            |  |            |   |  |                     |   |  |                  |  
|Other Income (Expense)                                      |  |            |   |  |                     |   |  |                  |  
|                                                            |  |            |   |  |                     |   |  |                  |  
|Accretion of discounts on convertible
      debt            |  |           |   |  | (241,193            | ) |  | (799,963         | )
|Debt conversion
      expense                               |  |           |   |  | (2,010,076          | ) |  | (2,010,076       | )
|Gain on change in fair values of
      derivative liability |  |           |   |  | 327,389             |   |  | 432,715          |  
|Gain on settlement
      of related party debt              |  |           |   |  |                    |   |  | (2,871           | )
|Gain on write-off of accounts payable                       |  |           |   |  | 3,020               |   |  | 3,020            |  
|Interest expense                                            |  | (1,169     | ) |  | (105,218            | ) |  | (338,744         | )
|Loss on extinguishment of debt                              |  |           |   |  | (252,454            | ) |  | (252,454         | )
|Loss on sale of
      investment securities                 |  |           |   |  |                    |   |  | (411,430         | )
|Recovery (impairment) of investment securities              |  |           |   |  | 14,809              |   |  | (459,817         | )
|                                                            |  |            |   |  |                     |   |  |                  |  
|Total Other Income
      (Expense)                          |  | (1,169     | ) |  | (2,263,723          | ) |  | (3,839,620       | )
|                                                            |  |            |   |  |                     |   |  |                  |  
|Net Loss                                                    |  | (1,057,272 | ) |  | (2,851,743          | ) |  | (20,985,487      | )
|                                                            |  |            |   |  |                     |   |  |                  |  
|Net Loss Per Share,
      Basic and Diluted                 |  | (0.01      | ) |  | (0.11               | ) |  |                  |  
|                                                            |  |            |   |  |                     |   |  |                  |  
|Weighted Average Shares
      Outstanding                   |  | 76,717,000 |   |  | 25,513,000          |   |  |                  |  

(The accompanying notes are an integral part of these financial
  statements)

F-4

---

Canyon Copper Corp. 
  (An Exploration Stage Company) 
  Statement of Stockholders Equity (Deficit) 
  From January 21, 2000 (Date
  of Inception) to June 30, 2010 
  (Expressed in U.S. dollars)

DefictAccumulated
      
      
      AccumulatedPreferred Stock
      
      Common Stock
      
      
      Additional
      
      
      Common
      
      
      Stock
      
      
      Other
      
      
      During thePar
      
      
      
      
      Par
      
      
      Paid-in
      
      
      Stock
      
      
      Subscriptions
      
      
      Comprehensive
      
      
      ExplorationShares
      
      
      Value
      
      Shares
      
      
      Value
      
      
      Capital
      
      
      Subscribed
      
      
      Receivable
      
      
      Loss
      
      
      Stage
      
      
      Total#
      
      
      $
      
      #
      
      
      $
      
      
      $
      
      
      $
      
      
      $
      
      
      $
      
      
      $
      
      
      $Balance, January 21, 2000 (date of inception)
      
      
      
      
      
      
      
      
      
      
      
      
      
      
      
      
      
      
      
      
      
      
      
      
      
      
      Issuance of stock for
        services and payment 
           of advances for $0.006
        per share
      
      
      
      
      
      46,000,000
      
      
      460
      
      
      274,540
      
      
      
      
      
      
      
      
      
      
      
      
      
      
      275,000Net loss for the period
      
      
      
      
      
      
      
      
      
      
      
      
      
      
      
      
      
      
      
      
      
      
      
      (290,820
      )
      
      (290,820
      )Balance  June 30, 2000
      
      
      
      
      
      46,000,000
      
      
      460
      
      
      274,540
      
      
      
      
      
      
      
      
      
      
      
      (290,820
      )
      
      (15,820
      )Net loss for the year
      
      
      
      
      
      
      
      
      
      
      
      
      
      
      
      
      
      
      
      
      
      
      
      (11,766
      )
      
      (11,766
      )Balance, June 30, 2001
      
      
      
      
      
      46,000,000
      
      
      460
      
      
      274,540
      
      
      
      
      
      
      
      
      
      
      
      (302,586
      )
      
      (27,586
      )Issuance of stock for
        cash at $0.011 per 
           share
      
      
      
      
      
      6,844,938
      
      
      68
      
      
      74,333
      
      
      
      
      
      
      
      
      
      
      
      
      
      
      74,401Net loss for the year
      
      
      
      
      
      
      
      
      
      
      
      
      
      
      
      
      
      
      
      
      
      
      
      (43,817
      )
      
      (43,817
      )Balance, June 30, 2002
      
      
      
      
      
      52,844,938
      
      
      528
      
      
      348,873
      
      
      
      
      
      
      
      
      
      
      
      (346,403
      )
      
      2,998Net loss for the year
      
      
      
      
      
      
      
      
      
      
      
      
      
      
      
      
      
      
      
      
      
      
      
      (17,713
      )
      
      (17,713
      )Balance, June 30, 2003
      
      
      
      
      
      52,844,938
      
      
      528
      
      
      348,873
      
      
      
      
      
      
      
      
      
      
      
      (364,116
      )
      
      (14,715
      )Cancellation of stock owned
        by a director
      
      
      
      
      
      (29,333,333
      )
      
      (293
      )
      
      293
      
      
      
      
      
      
      
      
      
      
      
      
      
      
      Conversion of debentures
      
      
      
      
      
      
      
      
      
      
      
      
      
      
      902,126
      
      
      
      
      
      
      
      
      
      
      
      902,126Issuance of stock for
        cash at $4.50 per 
           share
      
      
      
      
      
      233,333
      
      
      2
      
      
      1,049,998
      
      
      
      
      
      
      
      
      
      
      
      
      
      
      1,050,000Stock issuance costs
      
      
      
      
      
      
      
      
      
      
      
      (105,000
      )
      
      
      
      
      
      
      
      
      
      
      
      
      
      (105,000
      )Net loss for the year
      
      
      
      
      
      
      
      
      
      
      
      
      
      
      
      
      
      
      
      
      
      
      
      (1,601,036
      )
      
      (1,601,036
      )Balance, June 30, 2004
      
      
      
      
      
      23,744,938
      
      
      237
      
      
      1,294,164
      
      
      902,126
      
      
      
      
      
      
      
      
      (1,965,152
      )
      
      231,375


(The accompanying notes are an integral part of these financial
  statements)

F-5

---

Canyon Copper Corp. 
  (An Exploration Stage Company) 
  Statement of Stockholders Equity (Deficit) 
  From January 21, 2000 (Date
  of Inception) to June 30, 2010 
  (Expressed in U.S. dollars)

DeficitAccumulated
      
      
      AccumulatedPreferred Stock
      
      Common Stock
      
      
      Additional
      
      
      Common
      
      
      Stock
      
      
      Other
      
      
      During thePar
      
      
      
      
      Par
      
      
      Paid-in
      
      
      Stock
      
      
      Subscriptions
      
      
      Comprehensive
      
      
      ExplorationShares
      
      
      Value
      
      Shares
      
      
      Value
      
      
      Capital
      
      
      Subscribed
      
      
      Receivable
      
      
      Loss
      
      
      Stage
      
      
      Total#
      
      
      $
      
      #
      
      
      $
      
      
      $
      
      
      $
      
      
      $
      
      
      $
      
      
      $
      
      
      $Balance, June 30, 2004
      
      
      
      
      
      23,744,938
      
      
      237
      
      
      1,294,164
      
      
      902,126
      
      
      
      
      
      
      
      
      (1,965,152
      )
      
      231,375Issuance of stock for consulting
        services
      
      
      
      
      
      133,333
      
      
      1
      
      
      761,999
      
      
      
      
      
      
      
      
      
      
      
      
      
      
      762,000Cancellation of stock issued
        for 
         consulting services
      
      
      
      
      
      (66,667
      )
      
      (1
      )
      
      (727,999
      )
      
      
      
      
      
      
      
      
      
      
      
      
      
      (728,000
      )Issuance of stock pursuant
        to the exercise 
         of options
      
      
      
      
      
      133,333
      
      
      1
      
      
      199,999
      
      
      
      
      
      
      
      
      
      
      
      
      
      
      200,000Issuance of stock pursuant
        to conversion 
         of debentures
      
      
      
      
      
      183,135
      
      
      2
      
      
      902,124
      
      
      (902,126
      )
      
      
      
      
      
      
      
      
      
      
      Issuance of stock pursuant
        to 
         mineral property option agreements
      
      
      
      
      
      470,000
      
      
      5
      
      
      1,876,495
      
      
      
      
      
      
      
      
      
      
      
      
      
      
      1,876,500Issuance of stock to settle
        related party debt
      
      
      
      
      
      65,878
      
      
      1
      
      
      73,123
      
      
      
      
      
      
      
      
      
      
      
      
      
      
      73,124Cancellation of stock owned
        by the 
         President of the Company
      
      
      
      
      
      (6,666,667
      )
      
      (67
      )
      
      67
      
      
      
      
      
      
      
      
      
      
      
      
      
      
      Issuance of preferred stock
        for investment 
         securities
      500,000
      
      
      5
      
      
      
      
      
      
      
      1,382,013
      
      
      
      
      
      
      
      
      
      
      
      
      
      
      1,382,018Unrealized loss on investment
        securities
      
      
      
      
      
      
      
      
      
      
      
      
      
      
      
      
      
      
      
      
      (437,712
      )
      
      
      
      
      (437,712
      )Fair value of stock options
        granted
      
      
      
      
      
      
      
      
      
      
      
      384,144
      
      
      
      
      
      
      
      
      
      
      
      
      
      
      384,144Intrinsic value of beneficial conversion 
         features
      
      
      
      
      
      
      
      
      
      
      
      180,183
      
      
      
      
      
      
      
      
      
      
      
      
      
      
      180,183Net loss for the year
      
      
      
      
      
      
      
      
      
      
      
      
      
      
      
      
      
      
      
      
      
      
      
      (4,025,401
      )
      
      (4,025,401
      )Balance, June 30, 2005
      500,000
      
      
      5
      
      17,997,283
      
      
      179
      
      
      6,326,312
      
      
      
      
      
      
      
      
      (437,712
      )
      
      (5,990,553
      )
      
      (101,769
      )


(The accompanying notes are an integral part of these financial
  statements)

F-6

---

Canyon Copper Corp. 
  (An Exploration Stage Company) 
  Statement of Stockholders Equity (Deficit) 
  From January 21, 2000 (Date
  of Inception) to June 30, 2010 
  (Expressed in U.S. dollars)

DeficitAccumulated
      
      
      AccumulatedPreferred Stock
      
      Common Stock
      
      
      Additional
      
      
      Common
      
      
      Stock
      
      
      Other
      
      
      During thePar
      
      
      
      
      Par
      
      
      Paid-in
      
      
      Stock
      
      
      Subscriptions
      
      
      Comprehensive
      
      
      ExplorationShares
      
      
      Value
      
      Shares
      
      
      Value
      
      
      Capital
      
      
      Subscribed
      
      
      Receivable
      
      
      Loss
      
      
      Stage
      
      
      Total#
      
      
      $
      
      #
      
      
      $
      
      
      $
      
      
      $
      
      
      $
      
      
      $
      
      
      $
      
      
      $Balance, June 30, 2005
      500,000
      
      
      5
      
      17,997,283
      
      
      179
      
      
      6,326,312
      
      
      
      
      
      
      
      
      (437,712
      )
      
      (5,990,553
      )
      
      (101,769
      )Issuance of stock for cash
        at $0.75 per share
      
      
      
      
      
      1,666,667
      
      
      17
      
      
      1,249,983
      
      
      
      
      
      
      
      
      
      
      
      
      
      
      1,250,000Issuance of stock for cash
        at $0.90 per share
      
      
      
      
      
      500,000
      
      
      5
      
      
      449,995
      
      
      
      
      
      
      
      
      
      
      
      
      
      
      450,000Issuance of stock for geological
        data at a fair 
           value of $1.17 per share
      
      
      
      
      
      8,333
      
      
      
      
      
      9,750
      
      
      
      
      
      
      
      
      
      
      
      
      
      
      9,750Issuance of stock to settle
        debt at a fair value 
           of $1.11 per share
      
      
      
      
      
      21,248
      
      
      
      
      
      23,585
      
      
      
      
      
      
      
      
      
      
      
      
      
      
      23,585Issuance of stock for cash
        at $1.20 per share
      
      
      
      
      
      1,491,667
      
      
      15
      
      
      1,789,985
      
      
      
      
      
      
      
      
      
      
      
      
      
      
      1,790,000Share issuance costs
      
      
      
      
      
      
      
      
      
      
      
      (222,668
      )
      
      
      
      
      
      
      
      
      
      
      
      
      
      (222,668
      )Issuance of stock pursuant
        to a mineral
            property agreement
      
      
      
      
      
      166,667
      
      
      2
      
      
      284,998
      
      
      
      
      
      
      
      
      
      
      
      
      
      
      285,000Fair value of stock options
        granted
      
      
      
      
      
      
      
      
      
      
      
      3,229,195
      
      
      
      
      
      
      
      
      
      
      
      
      
      
      3,229,195Issuance of stock pursuant
        to the 
           exercise of stock options
      
      
      
      
      
      50,000
      
      
      1
      
      
      52,499
      
      
      
      
      
      
      
      
      
      
      
      
      
      
      52,500Unrealized loss on investment
        securities   
           recognized as an impairment
        loss
      
      
      
      
      
      
      
      
      
      
      
      
      
      
      
      
      
      
      
      
      437,712
      
      
      
      
      
      437,712Net loss for the year
      
      
      
      
      
      
      
      
      
      
      
      
      
      
      
      
      
      
      
      
      
      
      
      (7,692,137
      )
      
      (7,692,137
      )Balance, June 30, 2006
      500,000
      
      
      5
      
      21,901,865
      
      
      219
      
      
      13,193,634
      
      
      
      
      
      
      
      
      
      
      
      (13,682,690
      )
      
      (488,832
      )


(The accompanying notes are an integral part of these financial
  statements)

F-7

---

Canyon Copper Corp. 
  (An Exploration Stage Company) 
  Statement of Stockholders Equity (Deficit) 
  From January 21, 2000 (Date
  of Inception) to June 30, 2010 
  (Expressed in U.S. dollars)

DeficitAccumulated
      
      
      AccumulatedPreferred Stock
      
      Common Stock
      
      
      Additional
      
      
      Common
      
      
      Stock
      
      
      Other
      
      
      During thePar
      
      
      
      
      Par
      
      
      Paid-in
      
      
      Stock
      
      
      Subscriptions
      
      
      Comprehensive
      
      
      ExplorationShares
      
      
      Value
      
      Shares
      
      
      Value
      
      
      Capital
      
      
      Subscribed
      
      
      Receivable
      
      
      Loss
      
      
      Stage
      
      
      Total#
      
      
      $
      
      #
      
      
      $
      
      
      $
      
      
      $
      
      
      $
      
      
      $
      
      
      $
      
      
      $Balance, June 30, 2006
      500,000
      
      
      5
      
      21,901,865
      
      
      219
      
      
      13,193,634
      
      
      
      
      
      
      
      
      
      
      
      (13,682,690
      )
      
      (488,832
      )Issuance of stock for cash at
        $0.75 per share
      
      
      
      
      
      865,333
      
      
      9
      
      
      648,991
      
      
      
      
      
      
      
      
      
      
      
      
      
      
      649,000Issuance of stock for cash at
        $0.90 per share
      
      
      
      
      
      55,556
      
      
      1
      
      
      49,999
      
      
      
      
      
      
      
      
      
      
      
      
      
      
      50,000Issuance of shares pursuant
        to mineral property agreement
      
      
      
      
      
      171,667
      
      
      2
      
      
      172,948
      
      
      
      
      
      
      
      
      
      
      
      
      
      
      172,950Issuance of shares to settle
        debt
      
      
      
      
      
      133,333
      
      
      1
      
      
      99,999
      
      
      
      
      
      
      
      
      
      
      
      
      
      
      100,000Issuance of shares to settle
        related party debt
      
      
      
      
      
      7,067
      
      
      
      
      
      5,300
      
      
      
      
      
      
      
      
      
      
      
      
      
      
      5,300Issuance of shares to settle
        convertible debentures
      
      
      
      
      
      458,979
      
      
      5
      
      
      344,229
      
      
      
      
      
      
      
      
      
      
      
      
      
      
      344,234Intrinsic value of beneficial
        conversion features
      
      
      
      
      
      
      
      
      
      
      
      254,749
      
      
      
      
      
      
      
      
      
      
      
      
      
      
      254,749Net loss for the year
      
      
      
      
      
      
      
      
      
      
      
      
      
      
      
      
      
      
      
      
      
      
      
      (2,177,278
      )
      
      (2,177,278
      )Balance, June 30, 2007
      500,000
      
      
      5
      
      23,593,800
      
      
      237
      
      
      14,768,849
      
      
      
      
      
      
      
      
      
      
      
      (15,859,968
      )
      
      (1,089,877
      )Issuance of stock for cash at
        $0.75 per share
      
      
      
      
      
      400,000
      
      
      4
      
      
      299,996
      
      
      
      
      
      
      
      
      
      
      
      
      
      
      300,000Fair value of stock options
        granted
      
      
      
      
      
      
      
      
      
      
      
      578,932
      
      
      
      
      
      
      
      
      
      
      
      
      
      
      578,932Net loss for the year
      
      
      
      
      
      
      
      
      
      
      
      
      
      
      
      
      
      
      
      
      
      
      
      (1,216,504
      )
      
      (1,216,504
      )Balance, June 30, 2008
      500,000
      
      
      5
      
      23,993,800
      
      
      241
      
      
      15,647,777
      
      
      
      
      
      
      
      
      
      
      
      (17,076,472
      )
      
      (1,427,449
      )


(The accompanying notes are an integral part of these financial
  statements)

F-8

---

Canyon Copper Corp. 
  (An Exploration Stage Company) 
  Statement of Stockholders Equity (Deficit) 
  From January 21, 2000 (Date
  of Inception) to June 30, 2010 
  (Expressed in U.S. dollars)

DeficitAccumulated
      
      
      AccumulatedPreferred Stock
      
      Common Stock
      
      
      Additional
      
      
      Common
      
      
      Stock
      
      
      Other
      
      
      During thePar
      
      
      
      
      Par
      
      
      Paid-in
      
      
      Stock
      
      
      Subscriptions
      
      
      Comprehensive
      
      
      ExplorationShares
      
      
      Value
      
      Shares
      
      
      Value
      
      
      Capital
      
      
      Subscribed
      
      
      Receivable
      
      
      Loss
      
      
      Stage
      
      
      Total#
      
      
      $
      
      #
      
      
      $
      
      
      $
      
      
      $
      
      
      $
      
      
      $
      
      
      $
      
      
      $Balance, June 30, 2008
      500,000
      
      
      5
      
      23,993,800
      
      
      241
      
      
      15,647,777
      
      
      
      
      
      
      
      
      
      
      
      (17,076,472
      )
      
      (1,427,449
      )Issuance of stock for cash
        at $0.30 per share
      
      
      
      
      
      1,633,333
      
      
      16
      
      
      489,984
      
      
      
      
      
      
      
      
      
      
      
      
      
      
      490,000Issuance of stock for cash
        at $0.04 per share
      
      
      
      
      
      18,900,000
      
      
      189
      
      
      755,811
      
      
      
      
      
      (56,000
      )
      
      
      
      
      
      
      
      700,000Share issuance costs
      
      
      
      
      
      
      
      
      
      
      
      (2,767
      )
      
      
      
      
      
      
      
      
      
      
      
      
      
      (2,767
      )Issuance of shares to settle convertible
        debentures
      
      
      
      
      
      19,637,947
      
      
      196
      
      
      2,980,167
      
      
      
      
      
      
      
      
      
      
      
      
      
      
      2,980,363Net loss for the year
      
      
      
      
      
      
      
      
      
      
      
      
      
      
      
      
      
      
      
      
      
      
      
      (2,851,743
      )
      
      (2,851,743
      )Balance, June 30, 2009
      500,000
      
      
      5
      
      64,165,080
      
      
      642
      
      
      19,871,972
      
      
      
      
      
      (56,000
      )
      
      
      
      
      (19,928,215
      )
      
      (111,596
      )Issuance of stock for cash at $0.04 per
        share
      
      
      
      
      
      14,225,000
      
      
      142
      
      
      568,858
      
      
      
      
      
      
      
      
      
      
      
      
      
      
      569,000Fair value of stock options granted
      
      
      
      
      
      
      
      
      
      
      
      362,614
      
      
      
      
      
      
      
      
      
      
      
      
      
      
      362,614Subscriptions received
      
      
      
      
      
      
      
      
      
      
      
      
      
      
      
      
      
      56,000
      
      
      
      
      
      
      
      
      56,000Net loss for the year
      
      
      
      
      
      
      
      
      
      
      
      
      
      
      
      
      
      
      
      
      
      
      
      (1,057,272
      )
      
      (1,057,272
      )Balance, June 30, 2010
      500,000
      
      
      5
      
      78,390,080
      
      
      784
      
      
      20,803,444
      
      
      
      
      
      
      
      
      
      
      
      (20,985,487
      )
      
      (181,254
      )


(The accompanying notes are an integral part of these financial
  statements)

F-9

---

Canyon Copper Corp. 
  (An Exploration Stage Company) 
  Statements of Cash Flows 
  (Expressed in U.S. dollars)

|                                                                                   |  |            |   |  |                     |   |  | Accumulated from |  
|---------------------------------------------------------------------------------- |  | ---------- | - |  | ------------------- | - |  | ---------------- | -
|                                                                                   |  |            |   |  |                     |   |  | January 21, 2000 |  
|                                                                                   |  | Year Ended |   |  | (date of inception) |  
|                                                                                   |  | June 30,   |   |  | to June 30,         |  
|                                                                                   |  | 2010       |   |  | 2009                |   |  | 2010             |  
|                                                                                   |  | $          |   |  | $                   |   |  | $                |  
|Operating Activities                                                               |  |            |   |  |                     |   |  |                  |  
|                                                                                   |  |            |   |  |                     |   |  |                  |  
|Net loss                                                                           |  | (1,057,272 | ) |  | (2,851,743          | ) |  | (20,985,487      | )
|                                                                                   |  |            |   |  |                     |   |  |                  |  
|Adjustments to reconcile net loss
      to net cash used in  operating activities: |  |            |   |  |                     |   |  |                  |  
|                                                                                   |  |            |   |  |                     |   |  |                  |  
|                                                                                   |  |            |   |  |                     |   |  |                  |  
|Accretion of discounts on
      convertible debt                                   |  |           |   |  | 241,193             |   |  | 799,963          |  
|Amortization
      of deferred financing costs                                     |  |           |   |  |                    |   |  | 27,475           |  
|Bad debts                                                                          |  |           |   |  |                    |   |  | 3,000            |  
|Depreciation                                                                       |  |           |   |  |                    |   |  | 5,540            |  
|Foreign exchange translation
      loss on debt                                    |  |           |   |  | (9,156              | ) |  | (32,195          | )
|Gain on change
      in fair values of derivative liability                        |  |           |   |  | (327,389            | ) |  | (432,715         | )
|Gain on recovery of accounts
      payable                                         |  |           |   |  | (3,020              | ) |  | (3,020           | )
|Impairment
      of mineral property costs                                         |  |           |   |  |                    |   |  | 2,747,630        |  
|Impairment of property and
      equipment                                         |  |           |   |  |                    |   |  | 10,811           |  
|Loss on conversion
      of debt                                                   |  |           |   |  | 2,010,076           |   |  | 2,010,076        |  
|Loss on extinguishment of
      debt                                               |  |           |   |  | 252,454             |   |  | 252,454          |  
|Loss on sale
      of investment securities                                        |  |           |   |  |                    |   |  | 411,430          |  
|Loss on settlement of related
      party debt                                     |  |           |   |  |                    |   |  | 2,871            |  
|Recovery
      (impairment) of investment securities                               |  |           |   |  | (14,809             | ) |  | 564,223          |  
|Stock-based compensation                                                           |  | 362,614    |   |  |                    |   |  | 4,872,104        |  
|                                                                                   |  |            |   |  |                     |   |  |                  |  
|Changes in operating assets and liabilities:                                       |  |            |   |  |                     |   |  |                  |  
|                                                                                   |  |            |   |  |                     |   |  |                  |  
|Amount receivable                                                                  |  |           |   |  |                    |   |  | (3,000           | )
|Prepaid expenses
      and deposits                                                |  | (2,571     | ) |  | 9,655               |   |  | (3,351           | )
|Accounts payable and accrued liabilities                                           |  | (137,216   | ) |  | (70,118             | ) |  | 390,016          |  
|Due to related parties                                                             |  | 124,758    |   |  | 96,868              |   |  | 478,376          |  
|                                                                                   |  |            |   |  |                     |   |  |                  |  
|Net Cash Used in Operating Activities                                              |  | (709,687   | ) |  | (665,989            | ) |  | (8,883,799       | )
|                                                                                   |  |            |   |  |                     |   |  |                  |  
|Investing Activities                                                               |  |            |   |  |                     |   |  |                  |  
|                                                                                   |  |            |   |  |                     |   |  |                  |  
|Proceeds received on sale
      of investment securities                           |  |           |   |  | 14,809              |   |  | 432,060          |  
|Acquisition of mineral properties                                                  |  |           |   |  |                    |   |  | (413,138         | )
|Purchase of property and equipment                                                 |  |           |   |  |                    |   |  | (16,351          | )
|                                                                                   |  |            |   |  |                     |   |  |                  |  
|Net Cash Provided by Investing Activities                                          |  |           |   |  | 14,809              |   |  | 2,571            |  
|                                                                                   |  |            |   |  |                     |   |  |                  |  
|Financing Activities                                                               |  |            |   |  |                     |   |  |                  |  
|                                                                                   |  |            |   |  |                     |   |  |                  |  
|Advances from related party                                                        |  |           |   |  | 24,575              |   |  | 147,019          |  
|Proceeds from issuance of notes and loans
      payable                            |  |           |   |  |                    |   |  | 448,363          |  
|Proceeds from issuance
      of convertible debentures                             |  |           |   |  |                    |   |  | 1,684,655        |  
|Repayment of notes payable                                                         |  | (89,511    | ) |  |                    |   |  | (319,792         | )
|Repayment of convertible
      debentures                                          |  |           |   |  | (149,092            | ) |  | (149,092         | )
|Debt financing costs                                                               |  |           |   |  |                    |   |  | (250,143         | )
|Proceeds from share subscriptions
    and issuance of common stock                 |  | 625,000    |   |  | 1,187,233           |   |  | 7,573,136        |  
|                                                                                   |  |            |   |  |                     |   |  |                  |  
|Net Cash Provided
      by Financing Activities                                    |  | 535,489    |   |  | 1,062,716           |   |  | 9,134,146        |  
|                                                                                   |  |            |   |  |                     |   |  |                  |  
|Increase (Decrease) in Cash                                                        |  | (174,198   | ) |  | 411,536             |   |  | 252,918          |  
|                                                                                   |  |            |   |  |                     |   |  |                  |  
|Cash, Beginning of
      Period                                                    |  | 427,116    |   |  | 15,580              |   |  |                 |  
|                                                                                   |  |            |   |  |                     |   |  |                  |  
|Cash, End of Period                                                                |  | 252,918    |   |  | 427,116             |   |  | 252,918          |  

Supplementary Cash Flow Information (Note 12)

(The accompanying notes are an integral part of these financial
  statements)

F-10

---

Canyon Copper Corp. 
  (An Exploration Stage Company) 
  Notes to the Financial Statements 
  June 30, 2010 
  (Expressed in U.S. dollars)

|1. | Nature of Operations and Continuance of
      Business                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|-- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|   | Canyon Copper Corp., (the Company), was incorporated in
      the State of Nevada, U.S.A. on January 21, 2000 under the name Aberdene
      Mines Limited. On August 7, 2006, the Company changed its name to Canyon
      Copper Corp. The Company is an exploration stage company, as defined by
      Financial Accounting Standards Board (FASB) Accounting Standards
      Codification (ASC) 915, Development Stage Entities. The Companys
      principal business plan is to acquire, explore and develop mineral
      properties and ultimately seek earnings by exploiting mineral
      claims.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|   | The Company has been in the exploration stage since its
      formation in January 2000 and has not yet realized any revenues from its
      planned operations. It is primarily engaged in the acquisition,
      exploration and development of mineral properties. Upon location of a
      commercial mineable reserve, the Company will actively prepare the site
      for extraction and enter a development stage. At present, management
      devotes most of its activities to raising sufficient funds to further
      explore and develop its mineral properties. Planned principal activities
      have not yet begun. The ability of the Company to emerge from the
      exploration stage with respect to any planned principal business activity
      is dependent upon its successful efforts to raise additional debt or
      equity financing and/or attain profitable mining operations. As at June
      30, 2010, the Company has not generated any revenue, has a working capital
      deficit of $181,254, and has accumulated losses of $20,985,487 since
      inception. The Company also has significant mineral property acquisition
      and exploration commitments. There is no guarantee that the Company will
      be able to complete any of the above objectives. These factors raise
      substantial doubt regarding the Companys ability to continue as a going
      concern.
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|   | Managements plan for the next twelve months is to
      continue initial exploration activities on the New York Canyon Project in
      Nevada. The agreements pursuant to which the Company acquired its
      interests in the New York Canyon Project provide for a series of cash
      payments and annual filing maintenance costs. If the Company fails to make
      such payments or expenditures in a timely fashion, it may lose its
      interest in those properties. As at June 30, 2010, the Company had cash of
      $252,918 on hand, and for the next twelve months, management anticipates
      that the minimum cash requirements to fund its proposed exploration
      program and continued operations will be $942,000. Accordingly, the
      Company does not have sufficient funds to meet planned expenditures over
      the next twelve months, and will need to seek additional debt or equity
      financing to meet its planned expenditures. There is no assurance that the
      Company will be able to raise sufficient cash to fund its future
      exploration programs and operational expenditures.                                                                                                                                                                                                                                                                              
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|2. | Summary of Significant Accounting Policies                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|   | a)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|   | b)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|   | c)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 

F-11

---

Canyon Copper Corp. 
  (An Exploration Stage Company) 
  Notes to the Financial Statements 
  June 30, 2010 
  (Expressed in U.S. dollars)

|2. | Summary of Significant Accounting Policies
      (continued)
|-- | ------------------------------------------------------------
|   |                                                             
|   | d)                                                          
|   |                                                             
|   |                                                             
|   |                                                             
|   |                                                             
|   |                                                             
|   | e)                                                          
|   |                                                             
|   |                                                             
|   |                                                             
|   | f)                                                          
|   |                                                             
|   |                                                             
|   |                                                             
|   | g)                                                          
|   |                                                             
|   |                                                             
|   |                                                             
|   | h)                                                          
|   |                                                             
|   |                                                             

F-12

---

Canyon Copper Corp. 
  (An Exploration Stage Company) 
  Notes to the Financial Statements 
  June 30, 2010 
  (Expressed in U.S. dollars)

|2. | Summary of Significant Accounting Policies
      (continued)
|-- | ------------------------------------------------------------
|   |                                                             
|   | h)                                                          
|   |                                                             
|   |                                                             
|   |                                                             
|   |                                                             
|   |                                                             
|   |                                                             
|   |                                                             
|   | i)                                                          
|   |                                                             
|   |                                                             
|   |                                                             
|   | j)                                                          
|   |                                                             
|   |                                                             

Level 1

Level 1 applies to assets or
  liabilities for which there are quoted prices in active markets for identical
  assets or liabilities.

Level 2

Level 2 applies to assets or
  liabilities for which there are inputs other than quoted prices that are
  observable for the asset or liability such as quoted prices for similar assets
  or liabilities in active markets; quoted prices for identical assets or
  liabilities in markets with insufficient volume or infrequent transactions (less
  active markets); or model-derived valuations in which significant inputs are
  observable or can be derived principally from, or corroborated by, observable
  market data.

Level 3

Level 3 applies to assets or
  liabilities for which there are unobservable inputs to the valuation methodology
  that are significant to the measurement of the fair value of the assets or
  liabilities.

The Companys financial instruments
  consist principally of cash, accounts payable, accrued liabilities, and amounts
  due to related parties. Pursuant to ASC 820, the fair value of cash is
  determined based on Level 1 inputs, which consist of quoted prices in active
  markets for identical assets. The recorded values of all other financial
  instruments approximate their current fair values because of their nature and
  respective maturity dates or durations.

F-13

---

Canyon Copper Corp. 
  (An Exploration Stage Company) 
  Notes to the Financial Statements 
  June 30, 2010 
  (Expressed in U.S. dollars)

|2. | Summary of Significant Accounting Policies
      (continued)
|-- | ------------------------------------------------------------
|   |                                                             
|   | k)                                                          
|   |                                                             
|   |                                                             
|   |                                                             
|   | l)                                                          
|   |                                                             
|   |                                                             
|   |                                                             
|   | m)                                                          
|   |                                                             
|   |                                                             
|   |                                                             
|   |                                                             
|   |                                                             
|   |                                                             
|   |                                                             
|   | n)                                                          
|   |                                                             
|   |                                                             
|   |                                                             
|   |                                                             
|   |                                                             
|   |                                                             
|   |                                                             
|   |                                                             

F-14

---

Canyon Copper Corp. 
  (An Exploration Stage Company) 
  Notes to the Financial Statements 
  June 30, 2010 
  (Expressed in U.S.
  dollars)

|3. | Mineral Properties 
|-- | -------------------
|   |                    
|   | a)                 
|   |                    
|   |                    
|   |                    
|   |                    
|   |                    
|   | b)                 
|   |                    
|4. | Accrued Liabilities

| |                                            |  | 2010  |  |  | 2009   | 
| | ------------------------------------------ |  | ----- |  |  | ------ | 
| |                                            |  | $     |  |  | $      | 
| |                                            |  |       |  |  |        | 
| | Interest accrued on debt                   |  |      |  |  | 24,028 | 
| | Professional fees
      and other accruals |  | 2,288 |  |  | 267    | 
| |                                            |  |       |  |  |        | 
| |                                            |  | 2,288 |  |  | 24,295 | 

|5. | Related Party Transactions
|-- | --------------------------
|   |                           
|   | a)                        
|   |                           
|   | b)                        
|   |                           
|   |                           
|   |                           
|   |                           
|   |                           
|   |                           

F-15

---

Canyon Copper Corp. 
  (An Exploration Stage Company) 
  Notes to the Financial Statements 
  June 30, 2010 
  (Expressed in U.S. dollars)

|5. | Related Party Transactions
      (continued)
|-- | --------------------------------------------

| | iv) | $Nil (2009 - $21,504 (Cdn$25,000)) in advances which bear
      interest at 15% per annum, are secured by a promissory note, and was due
      on November 8, 2009. On January 13, 2009, the maturity date on the notes
      was extended to February 8, 2010. The Company repaid the note on July 31,
      2009; and
| | --- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |     |                                                                                                                                                                                                                                                                                                                        
| | v)  | $Nil (2009 - $25,000) in advances which bear interest at
      15% per annum, are secured by a promissory note, and was due on October 1,
      2008. On January 13, 2009, the maturity date on the notes was extended to
      January 1, 2010. The Company repaid the note on July 31,
      2009.                   

| | c) | As at June 30, 2010, the Company was indebted to the
      Chief Financial Officer of the Company for $292 (2009 - $267) which is
      non-interest bearing, unsecured and due on demand.                                                                                                               
| | -- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |    |                                                                                                                                                                                                                                                                                                          
| | d) | As at June 30, 2010, $10,190 (2009 - $70,190) is owed to
      a former Vice President of Finance of the Company and is included in
      accounts payable. The amount due is non-interest bearing, unsecured and
      due on demand.                                                                   
| |    |                                                                                                                                                                                                                                                                                                          
| | e) | As at June 30, 2010, $nil (2009 - $6,980) is owed to a
      former Vice President of the Company and is included in accounts payable.
      The amount due is non-interest bearing, unsecured and due on
      demand.                                                                                  
| |    |                                                                                                                                                                                                                                                                                                          
| | f) | During the year ended June 30, 2010, the Company incurred
      management fees of $60,505 (2009 - $53,830), $56,898 (2009 - $51,211), and
      $69,300 (2009 - $88,200) to the Chief Executive Officer of the Company,
      President of the Company, and Chief Financial Officer,
      respectively.
| |    |                                                                                                                                                                                                                                                                                                          
| | g) | During the year ended June 30, 2010, the Company incurred
      geological support fees of $20,000 (2009 - $nil), office and general
      expenses of $20,000 (2009 - $nil), and rent of $16,956 (2009 - $15,661) to
      a company with common directors and officers.                                
| |    |                                                                                                                                                                                                                                                                                                          
| | h) | As at June 30, 2010, $7,071 (Cdn$7,500) (2009 - $25,807
      (Cdn$30,000)) is owed to a company with common directors and officers and
      is included in accounts payable. The amount due is non-interest bearing,
      unsecured and due on demand.                                                

|6. | Convertible Debt
|-- | ----------------
|   |                 
|   | a)              
|   |                 
|   | b)              

F-16

---

Canyon Copper Corp. 
  (An Exploration Stage Company) 
  Notes to the Financial Statements 
  June 30, 2010 
  (Expressed in U.S. dollars)

|6. | Convertible Debt (continued)
|-- | ----------------------------

| |    | On November 27, 2006, the convertible loans were amended
      to modify the conversion privileges and the maturity date for the APF loan
      was extended to April 11, 2007 and the maturity date for the Aton loan was
      extended to April 12, 2007. The loans are convertible into units at the
      lesser of $0.90 per unit or the closing price of the Companys shares on
      the business day preceding the date that the Company receives a notice of
      conversion. Each unit will consist of one share of common stock and one
      half of a share purchase warrant. Each whole share purchase warrant is
      exercisable at $1.20 per common share for a period of one year from the
      date of issuance. In accordance with ASC 470-20 the Company deemed the
      terms of the amendment to be substantially different and treated the
      original convertible loans extinguished and exchanged for new convertible
      loans. The Company determined that the conversion feature of the
      convertible loans met the criteria of an embedded derivative and therefore
      the conversion features of the loans needed to be bifurcated and accounted
      for as a derivative. The Company recorded accretion of the discount of
      $148,077 up to November 27, 2006. On November 27, 2006, the Company
      recognized the difference of $44,843 between the fair value of the
      conversion feature before and after the amendment. The Company will adjust
      the carrying value of the conversion feature to its fair value at each
      reporting date.
| | -- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
| |    | On April 11, 2007, the maturity date of the APF loan was
      extended to October 11, 2007 and on April 12, 2007 the maturity date of
      the Aton loan was extended to October 12, 2007. In accordance with ASC
      470-20, the Company determined it should not apply extinguishment
      accounting as the fair value of the embedded conversion option was not
      greater than 10% of the carrying amount of the original debt instrument
      immediately prior to the modification. To October 12, 2007, the Company
      recorded accretion of the discount of $71,766 increasing the carrying
      value of the convertible loans to $500,000.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
| |    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
| |    | On November 30, 2007, the maturity date of the APF loan
      was extended to January 11, 2009 and the maturity date of the Aton loan
      was extended to January 12, 2009. In accordance with ASC 470-20, the
      Company determined it should apply extinguishment accounting as the fair
      value of the embedded conversion option was greater than 10% of the
      carrying amount of the original debt instrument immediately prior to the
      modification. On November 30, 2007, the Company recognized a gain of
      $41,201 upon extinguishment of the modified debt. In addition, the Company
      recognized a discount of $151,502 and increased the derivative liability
      to $151,502. During the year ended June 30, 2008, the Company recorded
      accretion of the discount of $78,996 increasing the carrying value of the
      convertible loans to $427,494 and recorded a gain on the change in the
      fair values of the derivative liabilities of $60,484, decreasing the fair
      value of the derivative liabilities to $91,017.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
| |    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
| |    | On January 13, 2009, the maturity dates of the APF loan
      and the Aton loan were extended to April 11, 2010 and April 12, 2010,
      respectively. In accordance with ASC 470-20, the Company determined it
      should apply extinguishment accounting as the fair value of the embedded
      conversion option was greater than 10% of the carrying amount of the
      original debt instrument immediately prior to the modification. On January
      13, 2009, the Company recognized a loss of $252,454 upon extinguishment of
      the modified debt. In addition, the Company recognized a discount of
      $500,000 and increased the derivative liability to $752,454. As at June
      15, 2009, the Company recorded accretion of the discount of $241,193
      increasing the carrying value of the convertible loans to $168,688. The
      Company recorded a gain on the change in the fair values of the derivative
      liabilities of $236,372, decreasing the fair value of the derivative
      liabilities to $516,082 on June 15, 2009.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
| |    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
| |    | On June 15, 2009, the Company entered into a Debt
      Settlement Agreement with Aton and APF, whereby the terms of the loans
      were amended. Upon their election to participate and pursuant to the
      agreement, the conversion price for the loans was amended to $0.04 per
      unit. Each unit consists of one share of common stock and one half of a
      share purchase warrant. Each whole share purchase warrant is exercisable
      at $0.06 per common share for a period of two years from the date of
      issuance. On June 30, 2009, the Company issued 15,629,454 units upon the
      conversion of principal of $500,000 and accrued interest of $125,178. The
      Company recognized an expense of $1,463,437 equal to the fair value of all
      securities and other consideration transferred in the transaction in
      excess of the fair value of securities issuable pursuant to the original
      conversion terms as a result of the amendment.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
| |    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
| | c) | On March 20, 2007, the Company received a loan of
      $120,000 from Aton Select Fund Limited. The loan bears interest at a rate
      of 15% per annum, was unsecured and due on demand. On April 25, 2007, the
      Company secured this loan by issuing a convertible note. The note is due
      on March 20, 2008 and is convertible at $0.90 per unit with each unit to
      consist of one common share and one share purchase warrant exercisable at
      $1.05 per common shares for a period of two years. In accordance with ASC
      470-20, the Company recognized the intrinsic value of the embedded
      beneficial conversion feature of $36,041 as additional paid-in capital and
      an equivalent discount which was expensed over the term of the convertible
      loan. During the year ended June 30, 2008, the Company recorded accretion
      of the discount of $36,041 increasing the carrying value of the
      convertible loan to $120,000. On May 9, 2008, the maturity date on the
      note was extended to June 20, 2009. This modification had no accounting
      impact.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            

F-17

---

Canyon Copper Corp. 
  (An Exploration Stage Company) 
  Notes to the Financial Statements 
  June 30, 2010 
  (Expressed in U.S.
  dollars)

|6. | Convertible Debt (continued)
|-- | ----------------------------

On June 15, 2009, the Company entered
  into a Debt Settlement Agreement with Aton Select Fund Limited, whereby the
  terms of the loan were amended. Upon their election to participate and pursuant
  to the agreement, the conversion price for the loan has been amended to $0.04
  per unit. Each unit consists of one share of common stock and one half of a
  share purchase warrant. Each whole share purchase warrant is exercisable at
  $0.06 per common share for a period of two years from the date of issuance. On
  June 30, 2009, the Company issued 4,008,493 units upon the conversion of
  principal of $120,000 and accrued interest of $40,340. The Company recognized an
  expense of $546,638 equal to the fair value of all securities and other
  consideration transferred in the transaction in excess of the fair value of
  securities issuable pursuant to the original conversion terms as a result of the
  amendment.

|7. | Common Stock                                              
|-- | ----------------------------------------------------------
|   |                                                           
|   | Stock transactions for the year ended June 30,
      2010:
|   |                                                           
|   | a)                                                        
|   |                                                           
|   | b)                                                        
|   |                                                           
|   | c)                                                        
|   |                                                           
|   |                                                           
|   |                                                           
|   | d)                                                        
|   |                                                           
|   | e)                                                        
|   |                                                           
|   | f)                                                        
|   |                                                           
|   | g)                                                        

|8. | Stock Options                                                                                                                                                                                                                                                                                                                                                             
|-- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|   |                                                                                                                                                                                                                                                                                                                                                                           
|   | On August 21, 2009, the Board of Directors of the Company
      adopted the Companys 2009 Stock Option Plan (the 2009 Plan). A total of
      7,800,000 shares of the Companys common stock are available for issuance
      under the 2009 Plan. As at June 30, 2010, the Company had 3,850,000 stock
      options available for granting pursuant to the 2009 Plan.
|   |                                                                                                                                                                                                                                                                                                                                                                           
|   | On August 21, 2009, prior to the adoption of the 2009
      Plan, the Board of Directors of the Company decided to suspend and/or
      terminate prior stock option plans in order to limit the number of shares
      that may be optioned by the Company as follows:                                                                                                   
|   |                                                                                                                                                                                                                                                                                                                                                                           
|   | i.                                                                                                                                                                                                                                                                                                                                                                        
|   |                                                                                                                                                                                                                                                                                                                                                                           
|   | ii.                                                                                                                                                                                                                                                                                                                                                                       
|   |                                                                                                                                                                                                                                                                                                                                                                           
|   | iii.                                                                                                                                                                                                                                                                                                                                                                      

F-18

---

Canyon Copper Corp. 
  (An Exploration Stage Company) 
  Notes to the Financial Statements 
  June 30, 2010 
  (Expressed in U.S. dollars)

|8. | Stock Options (continued)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|-- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|   | On August 21, 2009, the Company issued non-qualified
      stock options to purchase a total of 4,100,000 shares of common stock to
      various employees, officers, directors and consultants of the Company, of
      which 3,950,000 stock options were issued pursuant to the 2009 Plan. The
      options were granted with an exercise price of $0.10 per share and expire
      on August 20, 2014. The fair value of these stock options was estimated at
      the date of grant using the Black-Scholes option-pricing model assuming an
      expected life of 5 years, a risk-free rate of 2.58%, an expected
      volatility of 213%, and a 0% dividend yield. The weighted average fair
      value of stock options granted was $0.09 per option.
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|   | During the year ended June 30, 2010, the Company recorded
      stock-based compensation of $362,614 as general and administrative
      expense.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|   | A summary of the Companys stock option activity is as
      follows:                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              

| |                                                  |  |           |   |  | Weighted |  |  |                 | 
| | ------------------------------------------------ |  | --------- | - |  | -------- |  |  | --------------- | 
| |                                                  |  |           |   |  | Average  |  |  |                 | 
| |                                                  |  |           |   |  | Exercise |  |  | Aggregate       | 
| |                                                  |  | Number of |   |  | Price    |  |  | Intrinsic Value | 
| |                                                  |  | Options   |   |  | $        |  |  | $               | 
| |                                                  |  |           |   |  |          |  |  |                 | 
| | Outstanding, June 30, 2008                       |  | 1,391,667 |   |  | 0.78     |  |  |                 | 
| |                                                  |  |           |   |  |          |  |  |                 | 
| | Expired                                          |  | (200,000  | ) |  | 0.75     |  |  |                 | 
| |                                                  |  |           |   |  |          |  |  |                 | 
| | Outstanding, June 30, 2009                       |  | 1,191,667 |   |  | 0.77     |  |  |                 | 
| |                                                  |  |           |   |  |          |  |  |                 | 
| | Granted                                          |  | 4,100,000 |   |  | 0.10     |  |  |                 | 
| | Expired                                          |  | (799,999  | ) |  | 0.46     |  |  |                 | 
| |                                                  |  |           |   |  |          |  |  |                 | 
| | Outstanding and
      exercisable, June 30, 2010 |  | 4,491,668 |   |  | 0.21     |  |  |                | 

|   | As at June 30, 2010, the weighted average remaining
      contractual life of the outstanding stock options is 3.84 years.
|-- | --------------------------------------------------------------------------------------------------------------------------
|   |                                                                                                                           
|   | As at June 30, 2010, the Company had no unvested options
      outstanding.                                               
|   |                                                                                                                           
|9. | Share Purchase Warrants                                                                                                   
|   |                                                                                                                           
|   | The following table summarizes the continuity of the
      Companys share purchase warrants:                             

| |                              |  |            |   |  | Weighted | 
| | ---------------------------- |  | ---------- | - |  | -------- | 
| |                              |  |            |   |  | Average  | 
| |                              |  |            |   |  | Exercise | 
| |                              |  | Number of  |   |  | Price    | 
| |                              |  | Warrants   |   |  | $        | 
| |                              |  |            |   |  |          | 
| | Balance, June 30, 2008       |  | 455,556    |   |  | 0.94     | 
| |                              |  |            |   |  |          | 
| | Issued                       |  | 11,452,305 |   |  | 0.10     | 
| | Expired                      |  | (55,556    | ) |  | 1.20     | 
| |                              |  |            |   |  |          | 
| | Balance, June 30, 2009       |  | 11,852,305 |   |  | 0.13     | 
| |                              |  |            |   |  |          | 
| | Expired                      |  | (400,000   | ) |  | 0.90     | 
| |                              |  |            |   |  |          | 
| | Balance, June 30,
      2010 |  | 11,452,305 |   |  | 0.10     | 

As at June 30, 2010, the following
  share purchase warrants were outstanding:

ExerciseNumber of
      PriceWarrants
      $
      Expiry Date1,633,333
      0.36
      August 17, 20109,818,972
      0.06
      June 30, 201111,452,305


F-19

---

Canyon Copper Corp. 
  (An Exploration Stage Company) 
  Notes to the Financial Statements 
  June 30, 2010 
  (Expressed in U.S. dollars)

|10. | Contingent Liability                                                                                                                                                                                                                                                                                                     
|--- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|    |                                                                                                                                                                                                                                                                                                                          
|    | On January 23, 2007, Focused Investor Relations Marketing
      Inc. commenced an action in Ontario, Canada against the Company seeking
      payment in the amount of $84,000 pursuant to an oral agreement. The
      Company believes that this action is without merit and will defend its
      position vigorously.
|    |                                                                                                                                                                                                                                                                                                                          
|11. | Income Taxes                                                                                                                                                                                                                                                                                                             
|    |                                                                                                                                                                                                                                                                                                                          
|    | The Company has net operating losses carried forward of
      $6,486,282 available to offset taxable income in future years which expire
      beginning in fiscal 2020.                                                                                                                                                 
|    |                                                                                                                                                                                                                                                                                                                          
|    | The Company is subject to United States federal and state
      income taxes at an approximate rate of 35%. The reconciliation of the
      provision for income taxes at the United States federal statutory rate
      compared to the Companys income tax expense as reported is as
      follows:                   

| |                                                             |  | 2010       |   |  | 2009       |  
| | ----------------------------------------------------------- |  | ---------- | - |  | ---------- | -
| |                                                             |  | $          |   |  | $          |  
| | Net loss before income taxes per financial
      statements |  | (1,057,272 | ) |  | (2,851,743 | )
| | Income tax rate                                             |  | 35%        |   |  | 35%        |  
| | Income tax recovery                                         |  | 370,045    |   |  | 998,110    |  
| | Permanent differences and other                             |  | (126,914   | ) |  | (762,774   | )
| | Change in valuation allowance                               |  | (243,131   | ) |  | (235,336   | )
| | Provision for
      income taxes                            |  |           |   |  |           |  

The significant components of deferred
  income tax assets and liabilities at June 30, 2010 and 2009 are as follows:

| |                                      |  | 2010       |   |  | 2009       |  
| | ------------------------------------ |  | ---------- | - |  | ---------- | -
| |                                      |  | $          |   |  | $          |  
| |                                      |  |            |   |  |            |  
| | Mineral property costs               |  | 2,689,611  |   |  | 2,581,121  |  
| | Net operating losses carried forward |  | 2,270,199  |   |  | 2,135,558  |  
| | Valuation allowance                  |  | (4,959,810 | ) |  | (4,716,679 | )
| |                                      |  |            |   |  |            |  
| | Net deferred income tax asset        |  |           |   |  |           |  

|    | As at June 30, 2010, the Company is in arrears on filing
      its statutory corporate income tax returns and the amounts presented above
      are based on estimates. The actual losses available could differ from
      these estimates.
|--- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|    |                                                                                                                                                                                                                                             
|12. | Supplemental Cash Flow
      Information                                                                                                                                                                                                    

| |                                                          |  |            |  |  |                     |  |  | Accumulated from | 
| | -------------------------------------------------------- |  | ---------- |  |  | ------------------- |  |  | ---------------- | 
| |                                                          |  |            |  |  |                     |  |  | January 21, 2000 | 
| |                                                          |  | Year Ended |  |  | (date of inception) | 
| |                                                          |  | June 30,   |  |  | to June 30,         | 
| |                                                          |  | 2010       |  |  | 2009                |  |  | 2010             | 
| |                                                          |  | $          |  |  | $                   |  |  | $                | 
| |                                                          |  |            |  |  |                     |  |  |                  | 
| | Non-cash Investing and Financing Activities:             |  |            |  |  |                     |  |  |                  | 
| |                                                          |  |            |  |  |                     |  |  |                  | 
| | Preferred stock
      issued for investment securities   |  |           |  |  |                    |  |  | 1,535,575        | 
| | Investment securities used to pay
      the finders fee |  |            |  |  |                     |  |  |                  | 
| | for the preferred
      stock issuance                   |  |           |  |  |                    |  |  | 153,557          | 
| | Common stock issued to settle debt                       |  |           |  |  | 2,980,363           |  |  | 3,528,100        | 
| | Common stock issued
      for mineral property lease     |  |           |  |  |                    |  |  | 2,334,492        | 
| |                                                          |  |            |  |  |                     |  |  |                  | 
| | Supplemental Disclosures:                                |  |            |  |  |                     |  |  |                  | 
| |                                                          |  |            |  |  |                     |  |  |                  | 
| | Interest paid                                            |  | 26,729     |  |  | 49,650              |  |  | 98,850           | 
| | Income
      taxes paid                                  |  |           |  |  |                    |  |  |                  | 

F-20

---

Canyon Copper Corp. 
  (An Exploration Stage Company) 
  Notes to the Financial Statements 
  June 30, 2010 
  (Expressed in U.S. dollars)

|13. | Subsequent Event                                                                                                                                                                                                                                                                              
|--- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|    |                                                                                                                                                                                                                                                                                               
|    | On August 5, 2010, the Company entered into an agreement
      with a company with common directors and officers whereby it transferred
      39 mineral claims for consideration of $10 and a 2% net smelter return
      royalty over any future production on the transferred
      claims.

F-21

---

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


Dismissal of Independent Registered Public Accounting
Firm

On August 24, 2010, we dismissed Manning Elliott LLP (the
Former Auditor), as our independent public accountants. Our Board of Directors
and Audit Committee approved the dismissal of the Former Auditor.

The Former Auditors reports on our financial statements for
the years ended June 30, 2009 and 2008 did not contain an adverse opinion or
disclaimer of opinion, nor were they modified or qualified as to uncertainty,
audit scope or accounting principles with the exception of a statement regarding
the uncertainty of our ability to continue as a going concern.

There have been no disagreements during the fiscal years ended
June 30, 2009 and 2008 and the subsequent interim period up to and including the
date of dismissal between us and the Former Auditor on any matter of accounting
principles or practices, financial statement disclosure or auditing scope or
procedure, which, if not resolved to the satisfaction of the Former Auditor,
would have caused them to make reference to the subject matter of the
disagreement in connection with the Former Auditors report for the financial
statements for the past year and any subsequent interim period up to and
including to the date of the Former Auditors dismissal.

Appointment of Independent Registered Public Accounting
Firm

On August 24, 2010, we appointed Saturna Group Chartered
Accountants LLP ("Saturna") as our new independent registered public accounting
firm. Our Board of Directors and Audit Committee approved the engagement of
Saturna.

We did not consult with Saturna during the fiscal years ended
June 30, 2009 and 2008 and any subsequent interim period prior to their
engagement regarding: (i) the application of accounting principles to a specific
completed or proposed transaction or the type of audit opinion that might be
rendered on our financial statements, and either a written report was provided
to us or advice was provided that the newly appointed accountant concluded was
an important factor in reaching a decision as to the accounting, auditing or
financial reporting issue; or (ii) any matter that was either the subject of a
disagreement or a reportable event in response to paragraph (a)(1)(iv) of Item
304 of Regulation S-K, promulgated under the Exchange Act.

ITEM
9AT.         CONTROLS AND
PROCEDURES.

Disclosure Controls and Procedures

We carried out an evaluation of the effectiveness of our
disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e)
and 15d-15(e)) as of June 30, 2010 (the Evaluation Date). This evaluation was
carried out under the supervision and with the participation of our Chief
Executive Officer and Chief Financial Officer. Based upon that evaluation, our
Chief Executive Officer and Chief Financial Officer concluded that our
disclosure controls and procedures were not effective as of the Evaluation Date
as a result of the material weaknesses in internal control over financial
reporting discussed below.

Disclosure controls and procedures are those controls and
procedures that are designed to ensure that information required to be disclosed
in our reports filed or submitted under the Exchange Act are recorded,
processed, summarized and reported within the time periods specified in the
SEC's rules and forms. Disclosure controls and procedures include, without
limitation, controls and procedures designed to ensure that information required
to be disclosed in our reports filed under the Exchange Act is accumulated and
communicated to management, including our Chief Executive Officer and Chief
Financial Officer, to allow timely decisions regarding required disclosure.

Notwithstanding the assessment that our internal control over
financial reporting was not effective and that there were material weaknesses as
identified in this report, we believe that our financial statements contained in
our Annual Report on Form 10-K for the year ended June 30, 2010 fairly present
our financial condition, results of operations and cash flows in all material
respects.

27

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Management's Annual Report on Internal Control Over
Financial Reporting

Our management is responsible for establishing and maintaining
adequate internal control over financial reporting, as such term is defined in
Rules 13a-15(f) and 15d-15(f) under the Exchange Act, for the Company.

Internal control over financial reporting includes those
policies and procedures that: (1) pertain to the maintenance of records that, in
reasonable detail, accurately and fairly reflect the transactions and
dispositions of our assets; (2) provide reasonable assurance that transactions
are recorded as necessary to permit preparation of financial statements in
accordance with generally accepted accounting principles, and that our receipts
and expenditures are being made only in accordance with authorizations of its
management and directors; and (3) provide reasonable assurance regarding
prevention or timely detection of unauthorized acquisition, use or disposition
of our assets that could have a material effect on the financial statements.

Management recognizes that there are inherent limitations in
the effectiveness of any system of internal control, and accordingly, even
effective internal control can provide only reasonable assurance with respect to
financial statement preparation and may not prevent or detect material
misstatements. In addition, effective internal control at a point in time may
become ineffective in future periods because of changes in conditions or due to
deterioration in the degree of compliance with our established policies and
procedures.

A material weakness is a significant deficiency, or combination
of significant deficiencies, that results in there being a more than remote
likelihood that a material misstatement of the annual or interim financial
statements will not be prevented or detected.

Under the supervision and with the participation of our Chief
Executive Officer and Chief Financial Officer, management conducted an
evaluation of the effectiveness of our internal control over financial
reporting, as of the Evaluation Date, based on the framework set forth in
Internal Control-Integrated Framework issued by the Committee of Sponsoring
Organizations of the Treadway Commission (COSO). Based on its evaluation under
this framework, management concluded that our internal control over financial
reporting was not effective as of the Evaluation Date.

Management assessed the effectiveness of the Companys internal
control over financial reporting as of Evaluation Date and identified the
following material weaknesses:

Inadequate Segregation of Duties: We have an inadequate
number of personnel to properly implement control procedures.

Insufficient Written Policies & Procedures:We have
insufficient written policies and procedures for accounting and financial
reporting.

Inadequate Financial Statement Closing Process:We have
an inadequate financial statement closing process.

Lack of Audit Committee Financial Expert:Our audit
committee has deficiencies due to the fact that it does not have an audit
committee financial expert.

Management is committed to improving its internal controls and
will (1) continue to use third party specialists to address shortfalls in
staffing and to assist the Company with accounting and finance responsibilities,
(2) increase the frequency of independent reconciliations of significant
accounts which will mitigate the lack of segregation of duties until there are
sufficient personnel and (3) prepare and implement sufficient written policies
and checklists for financial reporting and closing processes and (4) may
consider appointing outside directors and audit committee members in the future.

Management, including our Chief Executive Officer and the Chief
Financial Officer, has discussed the material weakness noted above with our
independent registered public accounting firm. Due to the nature of this
material weakness, there is a more than remote likelihood that misstatements
which could be material to the annual or interim financial statements could
occur that would not be prevented or detected.

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

28

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Changes in internal control over financial reporting

There were no changes in our internal control over financial
reporting that occurred during the fiscal year ended June 30, 2010 that have
materially affected, or that are reasonably likely to materially affect, our
internal control over financial reporting.

Limitations on the effectiveness of controls and procedures

Our management, including our Chief Executive Officer and the
Chief Financial Officer, do not expect that the our controls and procedures will
prevent all potential errors or fraud. A control system, no matter how well
conceived and operated, can provide only reasonable, not absolute, assurance
that the objectives of the control system are met.

ITEM
9B.           OTHER
INFORMATION.

None.

29

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PART III

ITEM
10.           DIRECTORS,
EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE.

Our executive officers and directors and their respective ages
and titles are as follows:

NAME OF DIRECTOR / OFFICER
    AGE
    POSITIONAnthony Harvey
    76
    Director,
      Chairman and Chief Executive OfficerBenjamin Ainsworth
    69
    Director, President And SecretaryKurt Bordian
    42
    Chief Financial
      Officer and TreasurerBryan Wilson
    60
    DirectorMilton Datsopoulos
    68
    DirectorJames E. Yates
    68
    Director


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

Anthony Harvey(Director, Chairman, and Chief Executive
Officer): On May 30, 2006, Mr. Anthony Harvey was appointed as our Chairman,
Chief Executive Officer and as a member of our Board of Directors. Mr. Anthony
Harvey has over 40 years of consulting experience on numerous mining projects
internationally with capital costs ranging up to and exceeding $400 million. Mr.
Harvey has spent 30 years working with Wright Engineers Ltd. Fluor Daniels in
various management positions, including Senior Project Manager, involved in the
design and construction of 14 mines world wide on behalf of major mining
corporations.

Mr. Harvey is presently the founder and board member of ARH
Management Limited, which has provided management and consulting services to the
resource industry. Mr. Harvey is also currently chairman and a director of ESO
Uranium Corp. (ESO-TSX.V), a uranium exploration company with properties located
in Saskatchewan and Northeastern Ontario.

Also, Mr. Harvey was a director of Terra Energy Inc.
(TTR-TSX.V) from August 2002 to May 2007, a petroleum and natural gas company
based in Calgary, Alberta. Mr. Harvey was a former founder, president and
chairman of Azco Mining Inc. (AZCO-TSX/AMEX) from 1988 to 2000, former founder,
chairman and director of Oremex Resources Inc. (ORM-TSX.V), and former chairman
and director of Lakeshore Gold Corp. (LSG-TSX).

Benjamin Ainsworth(Director, President and Secretary):
On May 30, 2006, Mr. Benjamin Ainsworth was appointed as our Secretary and a
member of our Board of Directors. Since November 7, 2007, Mr. Ainsworth has
served as our President.

Mr. Ainsworth is a senior geologist and mining consultant who
has been involved in the mining industry for over thirty-five years. Mr.
Ainsworth joined Placer Development in 1965 and held positions of Senior
Geologist, Chief Geochemist, Exploration Manager  Eastern Canada, Exploration
Manager  Chile, and President  Placer Chile, South America. Throughout the
1970s, Mr. Ainsworth was involved in the design, budgeting and implementation
of exploration programs that included large and small drill programs,
geophysical surveys, geological mapping, geochemical surveys, and a full range
of project evaluation studies.

Mr. Ainsworth is the principal, senior geologist and mining
consultant of Ainsworth Jenkins Holdings Inc. The consulting firm has been
responsible for concept, design and implementation of a number of exploration
projects. Since November 1995, Mr. Ainsworth has been a director of Black
Panther Mining Corp. (BPC.TSX.V). Mr. Ainsworth is also a director of several
reporting companies including ESO Uranium Corp. (ESO-TSX.V), Columbia Yukon
Explorations Inc. (CYU-TSX.V), Consolidated Venturex Holdings Ltd. (CVA-TSX.V),
Sultan Minerals Inc. (SUL-TSX.V), Hathor Exploration Ltd. (HAT-TSX.V) and Dajin
Resources Ltd. (DJI-TSX.V).

Kurt Bordian (Chief Financial Officer and Treasurer):
Mr. Kurt Bordian was appointed as our Chief Financial Officer on January 6, 2006
and as our Treasurer on November 7, 2007. Mr. Bordian is responsible for our
financial management functions. He has worked primarily in the mineral
exploration and oil and gas industries over the past 12 years.

30

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Mr. Bordian currently serves as a director or officer on a
number mineral exploration and development companies, including: Chief Financial
Officer of ESO Uranium Corp. (ESO-TSX.V) since November 2006; director of Thor
Explorations Ltd. (THX-TSX.V); director of Calypso Uranium Corp. (CLP-TSX.V)
since April 2006 and former Chief Financial Officer from February 2006 to March
2007; director of Cap-link Ventures Ltd. (CAV-TSX.V) since March 2008; director
of Palo Duro Energy Inc. (PDE-TSX.V) since August, 2006 and former Chief
Financial Officer from August, 2006 to September, 2006; and director of Waymar
Resources Ltd. (WYM-TSX.V) since May 2007.

Previously, Mr. Bordian has served as a director or officer on
the following public companies: director of Legal Access Technologies Inc. from
November 2004 to January 2006 and Chief Financial Officer from November 2004 to
April 2005; Chief Financial Officer of Mexoro Minerals Ltd. from February 2007
to June 2007; director of Bordeaux Energy Inc. (BDO-TSX.V) from July 2006 to
June 2007 and chief financial officer from July 2006 to September 2006; Chief
Financial Officer, Secretary and director of Black Tusk Minerals Inc.
(BKTK-OTCBB) from August 2005 to September 2008; Chief Financial Officer of Gold
Point Energy Corp. (GPE-TSX.V); and President, CEO and director of Magnate
Ventures Inc. (MGV.H-NEX) from May, 2007 to August 2009.

Mr. Bordian is a Certified General Accountant in Canada, and
holds a Bachelor of Commerce (Honors) Degree from the University of Manitoba.

Bryan Wilson (Director): Bryan Wilson has served as a
member of our Board of Directors since March 6, 2006. Mr. Wilson also served as
our President and Treasurer from May 30, 2006 to November 7, 2007.

Mr. Wilson obtained a Bachelor of Science from the University
of Waterloo in 1975. He has worked in the fields of mining exploration and
development for 18 years and financial services for 12 years. He has filled
various roles such as a Mining Analyst for C.M. Oliver and Dominick &
Dominick Securities Inc. and as a Corporate Finance Specialist for Thames
Capital. Since September 2008, Mr. Wilson has served as Director, Exploration
Business Development of Centerra Gold (CG  TSX), a company engaged in the
acquisition, development and production of gold properties in Central Asia, the
former Soviet Union and emerging markets. Mr. Wilson previously served as
President and CEO of Gee-Ten Ventures Inc. (GTV  TSX.V), a company engaged in
the exploration and development of mineral projects, from February 2008 to
September 2008 and as a director of Gee-Ten Ventures Inc. from February 2008 to
February 2010. Since September 1999, Mr. Wilson has acted as a director of
Spider Resources Inc. (SPQ-TSX.V), a junior exploration company, and was the CEO
and President of Spider Resources Inc. from June 2003 to June 2005.

In addition to the companies above, Mr. Wilson also acted as
CEO, President and Director of Vencan Gold Corp. (now known as Red Pine
Exploration Inc. (RPX  TSX.V)), an company engaged on the exploration of
various gold projects, from April 2003 to September 2005. Mr. Wilson also served
as President, CEO and director of St. Genevieve Resources Ltd. (SGVL-CNSX,
STGIF-OTCBB), a mining exploration and development company, from January 2003 to
March 2008.

Milton Datsopoulos (Director): Mr. Datsopoulos joined
our Board of Directors on July 1, 2004 and served as Chairman of the Board from
April 12, 2005 to May 30, 2006. Mr. Datsopoulos is the founder of and partner in
Datsopoulos, MacDonald, and Lind, P.C., a multi-disciplinary law firm located in
Missoula, Montana which specializes in business, environmental, and
transportation law with a U.S. and international clientele. He has served on and
continues to serve as a Genutec board member and director of numerous business
organizations including public and private companies, including Montana Rail
Link, Leigh Resource Corporation, Montana World Trade Center, Criticare Systems
Inc. (CMD  AMEX) and Healthrite Corporation.

Mr. Datsopoulos earned a bachelor's in Economics with high
honors and a law degree with honors, both from the University of Montana. Mr.
Datsopoulos and his partners have achieved the highest legal rating from the
most recognized national publication that rates attorneys based upon evaluations
by local attorneys and judges. He is a member of the State Bar of Montana,
American Bar Association, Montana Trial Lawyers Association, and the Association
of Trial Lawyers of America. Mr. Datsopoulos specializes in personal injury law,
criminal law, medical malpractice and general litigation practice.

James E. Yates (Director): Mr. Yates joined our Board of
Directors on April 15, 2009. Mr. Yates has over twenty years experience in the
mineral exploration industry and has served as a director and officer of several
public mining companies. From 1982 to 1988 he was the Founder, President and
Director of Hycroft Resources, which successfully brought the Crofoot Mine into
production. Mr. Yates has overseen the corporate management and financing of a number of projects in North America including
American Bullion Minerals, Zappa Resources, and Jersey Goldfields, having raised
in excess of $20 million for mineral exploration development. Mr. Yates is
currently a director of ESO Uranium Corp. (ESO  TSX.V), a mineral exploration
company focused on uranium exploration, and Nevada Geothermal Power Inc. (NGP 
TSX.V), a company engaged in producing geothermal electrical power from
geothermal resources in the United States.

31

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TERM OF OFFICE

Our directors are appointed for a one-year term to hold office
until the next annual general meeting of our stockholders or until removed from
office in accordance with our bylaws. Our officers are appointed by our board of
directors and hold office until removed by the board.

COMMITTEES OF THE BOARD OF DIRECTORS

Audit Committee

Our audit committee currently consists of Anthony Harvey and
James E. Yates. Mr. Harvey is not an independent director as he currently acts
as our Chairman and Chief Executive Officer. Mr. Yates is an independent member
of our Board of Directors.

Audit Committee Financial Expert

Our Board of Directors has determined that we do not presently
have a director who meets the definition of an audit committee financial
expert. We believe that the cost related to appointing a financial expert to
our Board of Directors at this time is prohibitive.

Disclosure Committee and Charter

We have a disclosure committee and disclosure committee
charter. The disclosure committee is comprised of all of our officers and
directors. The purpose of the committee is to provide assistance to the Chief
Executive Officer and the Chief Financial Officer in fulfilling their
responsibilities regarding the identification and disclosure of material
information about us, and the accuracy, completeness and timeliness of our
financial reports.

CODE OF ETHICS

We adopted a Code of Ethics applicable to our Chief Executive
Officer, Chief Financial Officer, Corporate Controller and certain other finance
executives, which is a "code of ethics" as defined by applicable rules of the
SEC. Our Code of Ethics was attached as an exhibit to our Annual Report on Form
10-KSB for the year ended June 30, 2003, filed with the SEC on August 26, 2003.
If we make any amendments to our Code of Ethics other than technical,
administrative, or other non-substantive amendments, or grant any waivers,
including implicit waivers, from a provision of our Code of Ethics to our chief
executive officer, chief financial officer, or certain other finance executives,
we will disclose the nature of the amendment or waiver, its effective date and
to whom it applies in a Current Report on Form 8-K filed with the SEC.

COMPLIANCE WITH SECTION 16(a) OF THE SECURITIES EXCHANGE ACT

Section 16(a) of the Exchange Act requires our executive
officers and directors, and persons who own more than 10% of a registered class
of our securities (Reporting Persons), to file reports of ownership and
changes in ownership with the SEC. Reporting Persons are required by SEC
regulations to furnish us with copies of all forms they file pursuant to Section
16(a). Based solely on our review of such reports received by the Company, other
than as described below, we believe that, during the year ended June 30, 2010,
all Reporting Persons complied with all Section 16(a) filing requirements
applicable to them.

The following persons have failed to file, on a timely basis,
the identified reports required by Section 16(a) of the Exchange Act:

32

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Name and Principal Position
    Number of Late Insider
      Reports
    Transactions Not Timely
      Reported
    Known Failures to File a
      Required FormAnthony Harvey Director,
      Chairman and Chief Executive Officer
    None
    None
    NoneBenjamin Ainsworth Director, President
      And Secretary
    None
    None
    NoneKurt Bordian Chief
      Financial Officer and Treasurer
    None
    None
    NoneBryan Wilson Director
    None
    None
    NoneMilton Datsopoulos
      Director
    None
    None
    NoneJames E. Yates Director
    None
    None
    NoneAndrew Malim Former
      Director
    Two
    Two
    None


ITEM
11.           EXECUTIVE
COMPENSATION.

SUMMARY COMPENSATION TABLE

The following table sets forth the total compensation paid to
or earned by our named executive officers, as that term is defined in Item
402(m)(2) of Regulation S-K as of our fiscal years ended June 30, 2010 and 2009:

Name &
      Principal Position
    Year
    Salary
      ($)
    Bonus
      ($)
    Stock Awards
      ($)
    Option
      Awards ($)
    Non- Equity
      Incentive Plan Compen- sation
      ($)
    Non- qualified
      Deferred Compen- sation
      Earnings ($)
    All Other
      Compen- sation ($)
    Total
      ($)Anthony Harvey, Director,
      Chairman and CEO(1)
    2010 2009
    60,505 53,830
    - -
    - -
    106,131 -
    - -
    - -
    - -
    166,636 53,830Kurt Bordian, CFO and
      Treasurer(2)
    2010 2009
    69,300 88,200
    - -
    - -
    44,221 -
    - -
    - -
    - -
    113,521 88,200Benjamin Ainsworth,
      Director, President and Secretary(3)
    2010 2009
    56,898 51,211
    - -
    - -
    53,066 -
    - -
    - -
    - -
    109,964 51,211


Notes:

|(1) | Mr. Harvey was appointed as our CEO, Chairman and as a
      member of our Board of Directors on May 30, 2006. Mr. Harvey is
      compensated for his services pursuant to a management consultant agreement
      dated December 1, 2007 among Canyon Copper, ARH Management Ltd. (ARH)
      and Mr. Harvey. Under the terms of the agreement, ARH is to be paid a
      consulting fee of CDN $5,000 per month.
|--- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(2) | Mr. Bordian was appointed as our Chief Financial Officer
      on January 6, 2006. Pursuant to the terms of a consultant agreement, we
      pay Mr. Bordian $3,675 per month. We also pay Mr. Bordian an additional
      $3,675 per month for various consulting and bookkeeping services performed
      by Mr. Bordian.                                                                                          
|(3) | Mr. Ainsworth was appointed as our President on November
      7, 2007. Mr. Ainsworth is compensated for his services pursuant to a
      management consultant agreement dated December 1, 2007 among Canyon
      Copper, Ainsworth-Jenkins Holdings Inc. (AJ Holdings) and Mr. Ainsworth.
      Under the terms of the agreement, AJ Holdings is to be paid a consulting
      fee of CDN $5,000 per month.     

33

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OUTSTANDING EQUITY AWARDS AT FISCAL YEAR END

The following table provides information concerning unexercised
options for each of our named executive officers, as that term is defined in
Item 402(m)(2) of Regulation S-K as of our fiscal year ended June 30, 2010:

Name and Principal
      Position
    Number of Securities
      Underlying Unexercised Options (#)
      Exercisable
    Number of Securities
      Underlying Unexercised Options (#)
      Unexercisable
    Equity Incentive Plan
      Awards: Number of Securities
      Underlying Unexercised Unearned Options
    Option
      Exercise Price
    Option
      Expiration DateAnthony Harvey Director, Chairman
      and CEO
    1,200,000 166,667
    - -
    - -
    $0.10 $0.75
    Aug 20, 2014
      Dec 2, 2012Kurt Bordian CFO and Treasurer
    500,000 166,667
    - -
    - -
    $0.10 $0.75
    Aug 20, 2014 Dec 2, 2012Benjamin Ainsworth Director, President
      and Secretary
    600,000 166,667
    - -
    - -
    $0.10 $0.75
    Aug 20, 2014
      Dec 2, 2012


DIRECTOR COMPENSATION

The following table sets forth the compensation paid to our
directors for the fiscal year ended June 30, 2010.

Name
    Fees Earned or Paid
      in Cash ($)
    Stock Awards
      ($)
    Option
      **Awards**($)
    Non-Equity Incentive
      Plan Compensation ($)
    Nonqualified Deferred
      Compensation Earnings ($)
    All Other
      Compensation ($)
    Total ($)Andrew Malim(1)
    -
    -
    35,377
    -
    -
    -
    35,377Bryan Wilson
    -
    -
    26,533
    -
    -
    -
    26,533Milton Datsopoulos
    -
    -
    26,533
    -
    -
    -
    26,533James E. Yates
    -
    -
    35,377
    -
    -
    -
    35,377


Note:

|(1) | On January 26, 2010, Andrew Malim resigned as a member of
      our Board of Directors.
|--- | ---------------------------------------------------------------------------------------

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

SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND
MANAGEMENT

The following table sets forth certain information concerning
the number of shares of our common stock owned beneficially as of September 21,
2010 by: (i) each of our directors and nominees, (ii) each of our named
executive officers, and (iii) officers and directors as a group. Other than as
described below, no person or group is known by us to beneficially own more than
5% of our outstanding shares of common stock. Unless otherwise indicated, the
stockholders listed possess sole voting and investment power with respect to the
shares shown.

34

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Title of Class
      Name and Address of Beneficial
        Owner
      Amount and Nature of Beneficial
        Ownership(1)
      Percentage of Common Stock(1)Directors and OfficersCommon Stock
      Anthony Harvey 
        Director, Chairman and Chief Executive Officer
      3,328,335 shares 
        Direct and Indirect(2)
      4.2%Common Stock
      Benjamin Ainsworth 
        Director, President and Secretary
      1,408,334 shares 
        Direct(3)
      1.8%Common Stock
      Kurt Bordian 
        Chief Financial Officer and Treasurer
      1,685,834 shares 
        Direct and Indirect(4)
      2.1%Common Stock
      Bryan Wilson 
        Director
      505,334 shares 
        Direct and Indirect(5)
      *Common Stock
      Milton Datsopoulos 
        Director
      2,275,000 shares 
        Direct(6)
      2.9%Common Stock
      James Yates 
        Director
      1,216,667 shares 
        Direct and Indirect(7)
      1.5%Common Stock
      All Officers and Directors 
        as a Group (6 persons)
      10,419,501 shares
      12.7%5% StockholdersCommon Stock
      Aton Ventures Fund Ltd. 
        3076 Sir Francis Drakes Hwy 
        Road Town, Tortola, BVI
      5,860,531 shares 
        Direct(8)
      7.3%Common Stock
      Barroco Foundation 
        Edificio Universal 50 Calle 50 No. 102 World 
        Panama, Republic of Panama
      5,861,559 shares 
        Direct(9)
      7.3%Common Stock
      Bonefin Trust Reg 
        Kirchstrasse 39 
        Vaduz, Liechtenstein FL 9490
      4,450,000 shares 
        Direct
      5.7%Common Stock
      Cornucopia Holdings Limited
        
        Herrengasse 2 PO Box 562 
        Vaduz, Liechtenstein FL 9490
      5,300,000 shares 
        Direct
      6.8%Common Stock
      Knightwall Invest Inc. 
        3076 Sir Francis Drakes Highway 
        Road Town, Tortola BVI
      6,250,000 shares 
        Direct
      8.0%Common Stock
      Silver BF Energy Ventures 
        SDN BHD 16thFloor Menara MIDF 82 Jalan 
        Raja Chulan, Kuala Lumpur Malaysia 50200
      5,860,531 shares 
        Direct(10)
      7.3%Common Stock
      Centrum Bank AG 
        Kirchstrasse 3 9490 Vaduz 
        Principality of Liechtenstein
      11,682,868 shares 
        Direct
      14.9%


Notes

|*   | Less than 1%.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|--- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(1) | Applicable percentage of ownership is based on 78,390,307
      shares of common stock outstanding as of September 21, 2010 together with
      securities exercisable or convertible into shares of Common Stock within
      60 days of September 21, 2010 for each stockholder. Beneficial ownership
      is determined in accordance with the rules of the SEC and generally
      includes voting or investment power with respect to securities. Shares of
      common stock subject to securities exercisable or convertible into shares
      of common stock that are currently exercisable or exercisable within 60
      days of September 21, 2010 are deemed to be beneficially owned by the
      person holding such options for the purpose of computing the percentage of
      ownership of such person, but are not treated as outstanding for the
      purpose of computing the percentage ownership of any other person.
|(2) | The number of shares listed as beneficially owned by Mr.
      Harvey consists of: (i) 1,908,334 shares of common stock owned directly by
      Mr. Harvey; (ii) 53,334 shares of common stock held by Mr. Harveys
      spouse; (iii) options to purchase 166,666 shares of common stock at a
      price of $0.75 per share until December 2, 2012; and (iv) the option to
      purchase 1,200,000 shares of common stock at a price of $0.10 per share
      until August 20, 2014.                                                                                                                                                                                                                                                                                                                                                                                                                                                        

35

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|(3)  | The number of shares listed as beneficially owned by Mr.
      Ainsworth consists of: (i) 641,667 shares of common stock owned directly
      by Mr. Ainsworth; (ii) options to purchase 166,666 shares of common stock
      at a price of $0.75 per share until December 2, 2012; and (iii) options to
      purchase 600,000 shares of common stock at a price of $0.10 per share
      until August 20, 2014.                                                                                                     
|---- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(4)  | The number of shares listed as beneficially owned by Mr.
      Bordian consists of: (i) 406,667 shares of common stock owned directly by
      Mr. Bordian; (ii) 612,500 shares of common stock held by Mr. Bordians
      spouse; (iii) options to purchase 166,666 shares of common stock
      exercisable at $0.75 per share until December 2, 2012 and (iv) the option
      to purchase 500,000 shares of common stock at $0.10 per share exercisable
      at $0.10 per share until August 20, 2014.          
|(5)  | The number of shares listed as beneficially owned by Mr.
      Wilson consists of: (i) 100,000 shares of common stock held directly by
      Mr. Wilson; (ii) 38,667 shares of common stock held by Rocknest Corp, of
      which Mr. Wilson is the sole shareholder; (iii) options to purchase 66,667
      shares of common stock at a price of $0.75 per share until December 2,
      2012; and (iv) options to purchase 300,000 shares of common stock at a
      price of $0.10 per share until August 20, 2014.
|(6)  | The number of shares listed as beneficially owned by Mr.
      Datsopoulos consists of: (i) 1,875,000 shares of common stock owned
      directly by Mr. Datsopoulus; (ii) options to purchase 100,000 shares of
      common stock at a price of $0.75 per share until December 2, 2012; and
      (iii) options to purchase 300,000 shares of common stock at a price of
      $0.10 per share until August 20, 2014.                                                                                               
|(7)  | The number of shares listed as beneficially owned by Mr.
      Yates consists of: (i) 416,667 shares of common stock owned directly by
      Mr. Yates; (ii) 400,000 shares of common stock held by Mr. Yates spouse;
      (iii) options to purchase 400,000 shares of common stock at a price of
      $0.10 per share until August 20, 2014.                                                                                                                                                                      
|(8)  | The number of shares listed as beneficially owned by Aton
      Ventures Fund Limited (Aton Ventures) consists of: (i) 3,907,021 shares
      of common stock directly held by Aton Ventures; and (ii) warrants to
      purchase 1,953,510 shares of common stock at a price of $0.06 per share
      until June 29, 2011.                                                                                                                                                                                         
|(9)  | The number of shares listed as beneficially owned by
      Barroco Foundation (Barroco) consists of: (i) 3,907,706 shares of common
      stock directly held by Barroco; and (ii) warrants to purchase 1,953,853
      shares of common stock at a price of $0.06 per share until June 29,
      2011.                                                                                                                                                                                                             
|(10) | The number of shares listed as beneficially owned by
      Silver BF Energy Ventures (Silver) consists of: (i) 3,907,021 shares of
      common stock directly held by Silver; and (ii) warrants to purchase
      1,953,510 shares of common stock at a price of $0.06 per share until June
      29, 2011.                                                                                                                                                                                                        

Change in Control

We are not aware of any arrangement that might result in a
change of control.

EQUITY COMPENSITION PLAN INFORMATION

The following table sets forth certain information concerning
all equity compensation plans previously approved by stockholders and all
previous equity compensation plans not previously approved by stockholders, as
at June 30, 2010.

EQUITY COMPENSATION PLAN INFORMATION AS
        AT JUNE 30, 2010Plan Category
      Number of securities
        to be issued upon exercise of outstanding
        options, warrants and rights (a)
      Weighted-average
        exercise price of outstanding options,
        warrants and rights (b)
      Number of securities
        remaining available for future issuance under
        equity compensation plans (excluding securities
        reflected in column (a)) (c)Equity Compensation Plans 
        approved by security holders
      Nil
      N/A
      NilEquity Compensation Plans 
        not approved by security 
        holders
      4,491,688
      $0.21 per share
      4,100,000Total
      4,491,688
      $0.21 per share
      4,100,000


36

---

2007 Stock Incentive Plan

On December 3, 2007, our Board of Directors adopted our 2007
Stock Incentive Plan (the "2007 Plan"). The number of common shares subject to
issuance pursuant to outstanding options, in the aggregate, cannot exceed
2,333,333 shares (the Initial Maximum Shares). The Initial Maximum Shares will
increase effective the first day of each of our fiscal quarters, beginning with
the fiscal quarter commencing January 1, 2008 by an amount equal to the lesser
of: (i) 10% of the total increase in the number of shares of common stock
outstanding during the previous fiscal quarter, or (ii) a lesser number of
shares of common stock as may be determined by the Board.

The exercise price of the options granted to Participants (as
defined in the 2007 Plan) other than Consultant Participants (as defined in the
2007 Plan): (i) cannot be less than the minimum exercise price that is at least
100% of the Fair Market Value of the common stock of the Company on the day of
grant, and in the case of a participant who owns more than 10% of the total
combined voting power of all classes of the our stock or of its parent or
subsidiary corporations at least 110% of the Fair Market Vale of the common
stock on the day of grant, and (ii) cannot be less than 85% of the Fair Market
Value of our common stock on the day of grant with respect to Non-Qualified
Stock Options.

On August 21, 2009, our Board of Directors determined that: (a)
no new options may be granted under the 2007 Plan; and (b) the 2007 Plan is to
be terminated once all outstanding options have been granted under the 2007 Plan
have been exercised, expired or otherwise terminated.

2009 Stock Option Plan

Our Board of Directors adopted our 2009 Stock Option Plan dated
August 21, 2009 (the "2009 Plan"). The number of common shares subject to
issuance pursuant to outstanding options, in the aggregate, cannot exceed
7,800,000 shares. The maximum number of shares will increase effective the first
day of each of our fiscal quarters, beginning with the fiscal quarter commencing
October 1, 2009 by an amount equal to the lesser of: (i) 10% of the total
increase in the number of shares of common stock outstanding during the previous
fiscal quarter, or (ii) a lesser number of shares of common stock as may be
determined by the Board.

The exercise price of the options granted to Participants (as
defined in the 2009 Plan) other than Consultant Participants (as defined in the
2009 Plan): (i) cannot be less than the minimum exercise price that is at least
100% of the Fair Market Value of the common stock of the Company on the day of
grant, and in the case of a participant who owns more than 10% of the total
combined voting power of all classes of the our stock or of its parent or
subsidiary corporations at least 110% of the Fair Market Vale of the common
stock on the day of grant, and (ii) cannot be less than 75% of the Fair Market
Value of our common stock on the day of grant with respect to Non-Qualified
Stock Options.

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


CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

None of the following parties has, during the past two fiscal
years, had any material interest, direct or indirect, in any transaction with us
or in any presently proposed transaction that has or will materially affect us,
other than as noted in this section:

| | (i)   | Any of our directors or executive officers;                                                                                                                                
| | ----- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | (ii)  | Any person proposed as a nominee for election as a
      director;                                                                                                         
| | (iii) | Any person who beneficially owns, directly or indirectly,
      shares carrying more than 5% of the voting rights attached to our
      outstanding shares of common stock;
| | (iv)  | Any of our promoters; and                                                                                                                                                  
| | (v)   | Any member of the immediate family (including spouse,
      parents, children, siblings and in-laws) of any of the foregoing
      persons.                                

37

---

As at June 30, 2010, we are indebted to Mr. Harvey, our CEO,
Chairman and a member of our Board of Directors, in the principal amount of
$146,144 (CDN$155,000) for unpaid consulting fees. This amount is non-interest
bearing, unsecured and due on demand.

As at June 30, 2010, we are indebted to Mr. Ainsworth, our
President, Secretary and a member of Board of Directors, in the amount of
$146,144 (CDN$155,000) for unpaid consulting fees. This amount is non-interest
bearing, unsecured and due on demand.

DIRECTOR INDEPENDENCE

Our common stock is listed on the OTC Bulletin Board
inter-dealer quotation system, which does not have director independence
requirements. For the purpose of determining director independence, we have
applied the definitions set out in NASDAQ Rule 5605(a)(2). Under NASDAQ Rule
5605(a)(2), a director is not considered independent if he or she is an
executive officer or employee of the corporation. Our board of directors have
determined that James Yates, Bryan Wilson and Milton Datsopoulos are independent
directors as defined under NASDAQ Rule 5605(a)(2). During the year ended June
2010, Mr. Yates served on the audit committee and the disclosure committee.

ITEM
14.           PRINCIPAL
ACCOUNTING FEES AND SERVICES.

Audit Fees

The aggregate fees billed for the two most recently completed
fiscal years ended June 30, 2010 and June 30, 2009 for professional services
rendered by the principal accountant for the audit of our annual financial
statements and review of the financial statements included our Quarterly Reports
on Form 10-Q and services that are normally provided by the accountant in
connection with statutory and regulatory filings or engagements for these fiscal
periods were as follows:

Year Ended June 30, 2010
      Year Ended June 30, 2009(Saturna Group)
      (Manning Elliott LLP)
      (Manning Elliott LLP)Audit Fees
      $10,418
      $ 7,577
      $39,274Audit Related Fees
      -
      -
      -Tax Fees
      -
      -
      -All Other Fees
      -
      -
      -Total
      $10,418
      $ 7,577
      $39,274


Policy on Pre-Approval by Audit Committee of Services
Performed by Independent Auditors

The policy of our Audit Committee is to pre-approve all audit
and permissible non-audit services to be performed by our independent auditors
during the fiscal year. Non-audit services that are prohibited to be provided by
our independent auditors may not be pre-approved. In addition, prior to the
granting of any pre-approval, our Audit Committee must be satisfied that the
performance of the services in question will not compromise the independence of
the independent auditors.

No services related to Audit-Related Fees, Tax
Fees or All Other Fees described above were approved by the Audit
Committee pursuant to the waiver of pre-approval provisions set forth in the
applicable rules of the SEC.

38

---

ITEM
15.           EXHIBITS,
FINANCIAL STATEMENT SCHEDULES.

|Exhibit |                                                                                                                                                                                  
|------- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|Number  | Description of Exhibit                                                                                                                                                           
|        |                                                                                                                                                                                  
|3.1     | Amended and Restated Articles of
      Incorporation.(14)                                                                                                                        
|        |                                                                                                                                                                                  
|3.2     | Certificate of Change Pursuant to NRS 78.209 decreasing
      the authorized capital of common stock to 166,666,666 shares, par value
      $0.00001 per share.(24)              
|        |                                                                                                                                                                                  
|3.3     | Bylaws.(1)                                                                                                                                                                       
|        |                                                                                                                                                                                  
|4.1     | Specimen Stock Certificate.(14)                                                                                                                                                  
|        |                                                                                                                                                                                  
|10.1    | 2004 Nonqualified Stock Option Plan.(4)                                                                                                                                          
|        |                                                                                                                                                                                  
|10.2    | 2006 Stock Incentive Plan dated April 5,
      2006.(10)                                                                                                                         
|        |                                                                                                                                                                                  
|10.3    | Convertible Preferred Stock Purchase Agreement dated July
      29, 2004 between the Company and Langley Park Investments
      PLC.(5)                                          
|        |                                                                                                                                                                                  
|10.4    | Property Option Agreement dated March 18, 2004 among the
      Company, Robert & Sharon Weicker, Kurt & Tami Schendel, and Nevada
      Sunrise LLC (New York Canyon Project).(3)
|        |                                                                                                                                                                                  
|10.5    | Lease Agreement dated July 21, 2004 between the Company
      and Jaycor Mining, Inc.(6)                                                                                         
|        |                                                                                                                                                                                  
|10.6    | Consulting Agreement dated April 5, 2005 between the
      Company and Anthony Harvey.(7)                                                                                        
|        |                                                                                                                                                                                  
|10.7    | Consulting Agreement dated August 5, 2005 between the
      Company and Chris Broili.(11)                                                                                        
|        |                                                                                                                                                                                  
|10.8    | Consulting Agreement dated August 10, 2005 between the
      Company and Mel Klohn.(11)                                                                                          
|        |                                                                                                                                                                                  
|10.9    | Consulting Agreement dated August 22, 2005 between the
      Company and Carlo Civelli.(11)                                                                                      
|        |                                                                                                                                                                                  
|10.10   | Consulting Agreement dated September 20, 2005 between the
      Company and Richard Dixon.(8)                                                                                    
|        |                                                                                                                                                                                  
|10.11   | Consulting Agreement dated September 20, 2005 between the
      Company and Richard Kehmeier.(8)                                                                                 
|        |                                                                                                                                                                                  
|10.12   | Consulting Agreement dated January 6, 2006 between the
      Company and Kurt Bordian.(9)                                                                                        
|        |                                                                                                                                                                                  
|10.13   | Consulting Agreement dated January 19, 2006 between the
      Company and Mark A. Reynolds.(8)                                                                                   
|        |                                                                                                                                                                                  
|10.14   | Consulting Agreement dated February 1, 2006 between the
      Company and Linda Erdman.(8)                                                                                       
|        |                                                                                                                                                                                  
|10.15   | Consulting Agreement dated February 1, 2006 between the
      Company and Geoffrey Goodall.(8)                                                                                   
|        |                                                                                                                                                                                  
|10.16   | Consulting Agreement dated February 1, 2006 between the
      Company and Robert Young.(11)                                                                                      
|        |                                                                                                                                                                                  
|10.17   | Debt Settlement Agreement dated November 8, 2005 between
      the Company and Cameron Reynolds.(11)                                                                             
|        |                                                                                                                                                                                  
|10.18   | Mineral Processing Research Agreement dated March 22,
      2006 among the Company, Nevada Sunrise, LLC and INTOR Resources
      Corporation.(11)                               
|        |                                                                                                                                                                                  
|10.19   | Loan Agreement dated September 12, 2006 between the
      Company and Aton Ventures Fund Ltd.(12)                                                                                
|        |                                                                                                                                                                                  
|10.20   | Loan Agreement dated September 11, 2006 between the
      Company and Asset Protection Fund Ltd.(12)                                                                             
|        |                                                                                                                                                                                  
|10.21   | Convertible Promissory Note dated September 12, 2006
      between the Company and Aton Ventures Fund Ltd.(12)                                                                   
|        |                                                                                                                                                                                  
|10.22   | Convertible Promissory Note dated September 11, 2006
      between the Company and Asset Protection Fund Ltd.(12)                                                                
|        |                                                                                                                                                                                  
|10.23   | Promissory Note dated August 16, 2006 between the Company
      and Anthony Harvey.(13)                                                                                          
|        |                                                                                                                                                                                  
|10.24   | First Amendment Loan Agreement dated November 27, 2006
      between the Company and Aton Ventures Fund Ltd.(15)                                                                 
|        |                                                                                                                                                                                  
|10.25   | First Amendment to Loan Agreement dated November 27, 2006
      between the Company and Asset Protection Fund Ltd.(15)                                                           
|        |                                                                                                                                                                                  
|10.26   | Convertible Promissory Note dated November 27, 2006
      between the Company and Aton Ventures Fund Ltd.(15)                                                                    

39

---

|Exhibit |                                                                                                                                                    
|------- | ---------------------------------------------------------------------------------------------------------------------------------------------------
|Number  | Description of
      Exhibit                                                                                                                       
|        |                                                                                                                                                    
|10.27   | Convertible Promissory Note dated November 27, 2006
      between the Company and Asset Protection Fund Ltd.(15)                                   
|        |                                                                                                                                                    
|10.28   | Quitclaim Deed for the New York Canyon Project dated
      March 12, 2007.(16)                                                                     
|        |                                                                                                                                                    
|10.29   | Sponsorship Agreement dated March 29, 2007 between the
      Company and Union Securities Ltd.(17)                                                 
|        |                                                                                                                                                    
|10.30   | Engagement Letter dated March 29, 2007 between the
      Company and Union Securities Ltd.(17)                                                     
|        |                                                                                                                                                    
|10.31   | Second Amendment to Loan Agreement dated April 12, 2007
      between the Company and Aton Ventures Fund Ltd.(17)                                  
|        |                                                                                                                                                    
|10.32   | Second Amendment to Loan Agreement dated April 11, 2007
      between the Company and Asset Protection Fund Ltd.(17)                               
|        |                                                                                                                                                    
|10.33   | Loan Agreement dated April 25, 2007 between the Company
      and Aton Select Fund Limited.(17)                                                    
|        |                                                                                                                                                    
|10.34   | Loan Agreement dated April 25, 2007 between the Company
      and Anthony Harvey for the loan of CDN$50,000.(17)                                   
|        |                                                                                                                                                    
|10.35   | Loan Agreement dated April 25, 2007 between the Company
      and Anthony Harvey for the loan of $100,000.(17)                                     
|        |                                                                                                                                                    
|10.36   | Promissory Note dated April 25, 2007 between the Company
      and Aton Select Fund Limited.(17)                                                   
|        |                                                                                                                                                    
|10.37   | Promissory Note dated April 25, 2007 between the Company
      and Anthony Harvey for the loan of CDN$50,000.(17)                                  
|        |                                                                                                                                                    
|10.38   | Promissory Note dated April 25, 2007 between the Company
      and Anthony Harvey for the loan of $100,000.(17)                                    
|        |                                                                                                                                                    
|10.39   | Termination Agreement dated September 25, 2007 between
      the Company and Mark Reynolds.(18)                                                    
|        |                                                                                                                                                    
|10.40   | Third Amendment to Loan Agreement dated November 30, 2007
      between the Company and Aton Ventures Fund Ltd.(19)                                
|        |                                                                                                                                                    
|10.41   | Third Amendment to Loan Agreement dated November 30, 2007
      between the Company and Asset Protection Fund Ltd.(19)                             
|        |                                                                                                                                                    
|10.42   | Convertible Promissory Note dated November 30, 2007
      between the Company and Aton Ventures Fund Ltd.(19)                                      
|        |                                                                                                                                                    
|10.43   | Convertible Promissory Note dated November 30, 2007
      between the Company and Asset Protection Fund Ltd.(19)                                   
|        |                                                                                                                                                    
|10.44   | Management Consulting Agreement dated December 1, 2007
      between the Company, ARH Management Ltd. and Anthony
      Harvey.(19)                
|        |                                                                                                                                                    
|10.45   | Management Consulting Agreement dated December 1, 2007
      between the Company, Ainsworth-Jenkins Holdings Inc. and Benjamin
      Ainsworth.(19)
|        |                                                                                                                                                    
|10.46   | 2007 Stock Incentive Plan.(19)                                                                                                                     
|        |                                                                                                                                                    
|10.47   | Form of Non-Qualified Stock Option Agreement between the
      Company and Directors and Officers.(19)                                             
|        |                                                                                                                                                    
|10.48   | Loan Agreement dated April 1, 2008 between the Company
      and Anthony Harvey.(20)                                                               
|        |                                                                                                                                                    
|10.49   | Promissory Note dated April 1, 2008 between the Company
      and Anthony Harvey.(20)                                                              
|        |                                                                                                                                                    
|10.50   | Loan Agreement dated May 8, 2008 between the Company and
      Anthony Harvey.(21)                                                                 
|        |                                                                                                                                                    
|10.51   | Promissory Note dated May 8, 2008 between the Company and
      Anthony Harvey.(21)                                                                
|        |                                                                                                                                                    
|10.52   | First Amendment to Loan Agreement dated May 9, 2008
      between the Company and Aton Select Fund Limited.(21)                                    
|        |                                                                                                                                                    
|10.53   | Convertible Promissory Note dated May 9, 2008 between the
      Company and Aton Select Fund Limited.(21)                                          
|        |                                                                                                                                                    
|10.54   | First Amendment to Loan Agreement dated May 9, 2008
      between the Company and Anthony Harvey for the loan of
      $100,000.(21)               

40

---

|Exhibit |                                                                                                                                                             
|------- | ------------------------------------------------------------------------------------------------------------------------------------------------------------
|Number  | Description of Exhibit                                                                                                                                      
|        |                                                                                                                                                             
|10.55   | Convertible
        Promissory Note dated May 9, 2008 between the Company and Anthony Harvey
        for the loan of $100,000.(21)                          
|        |                                                                                                                                                             
|10.56   | First Amendment
        to Loan Agreement dated May 9, 2008 between the Company and Anthony Harvey
        for the loan of CDN$50,000.(21)                  
|        |                                                                                                                                                             
|10.57   | Convertible
        Promissory Note dated May 9, 2008 between the Company and Anthony Harvey
        for the loan of CDN$50,000.(21)                        
|        |                                                                                                                                                             
|10.58   | Loan Agreement
        dated July 7, 2008 between the Company and Anthony Harvey for the loan
        of CDN $25,000.(22)                                   
|        |                                                                                                                                                             
|10.59   | Promissory Note
        dated July 7, 2008 between the Company and Anthony Harvey for the loan
        of CDN $25,000.(22)                                  
|        |                                                                                                                                                             
|10.60   | Fourth Amendment
        to Loan Agreement dated January 13, 2009 between the Company and Aton
        Ventures Fund Ltd.(23)                               
|        |                                                                                                                                                             
|10.61   | Convertible
        Promissory Note dated January 13, 2009 between the Company and Aton Ventures
        Fund Ltd.(23)                                      
|        |                                                                                                                                                             
|10.62   | Fourth Amendment
        to Loan Agreement dated January 13, 2009 between the Company and Asset
        Protection Fund Ltd.(23)                            
|        |                                                                                                                                                             
|10.63   | Convertible
        Promissory Note dated January 13, 2009 between the Company and Asset Protection
        Fund Ltd.(23)                                   
|        |                                                                                                                                                             
|10.64   | First Amendment
        to Loan Agreement dated January 13, 2009 between the Company and Anthony
        Harvey for the loan of $25,000 USD.(23)            
|        |                                                                                                                                                             
|10.65   | Convertible
        Promissory Note dated January 13, 2009 between the Company and Anthony
        Harvey for the loan of $25,000 USD.(23)                  
|        |                                                                                                                                                             
|10.66   | First Amendment
        to Loan Agreement dated January 13, 2009 between the Company and Anthony
        Harvey for the loan of $25,000 CDN.(23)            
|        |                                                                                                                                                             
|10.67   | Convertible
        Promissory Note dated January 13, 2009 between the Company and Anthony
        Harvey for the loan of $25,000 CDN.(23)                  
|        |                                                                                                                                                             
|10.68   | First Amendment
        to Loan Agreement dated January 13, 2009 between the Company and Anthony
        Harvey for the loan of $25,000 CDN.(23)            
|        |                                                                                                                                                             
|10.69   | Convertible
        Promissory Note dated January 13, 2009 between the Company and Anthony
        Harvey for the loan of $25,000 CDN.(23)                  
|        |                                                                                                                                                             
|10.70   | Subscription
        and Debt Settlement Agreement dated for reference June 15, 2009 between
        the Company and Aton Ventures Fund Ltd.(25)            
|        |                                                                                                                                                             
|10.71   | Subscription
        and Debt Settlement Agreement dated for reference June 15, 2009 between
        the Company and Silver BF Energy Ventures Sdn. Bhd.(25)
|        |                                                                                                                                                             
|10.72   | Subscription
        and Debt Settlement Agreement dated for reference June 15, 2009 between
        the Company and Asset Protection Fund Ltd.(25)         
|        |                                                                                                                                                             
|10.73   | Subscription
        and Debt Settlement Agreement dated for reference June 15, 2009 between
        the Company and Barroco Foundation.(25)                
|        |                                                                                                                                                             
|10.74   | Subscription
        and Debt Settlement Agreement dated for reference June 15, 2009 between
        the Company and Aton Select Fund Limited.(25)          
|        |                                                                                                                                                             
|10.75   | 2009 Stock Option
        Plan.(26)                                                                                                                         
|        |                                                                                                                                                             
|10.76   | Form of Non-Qualified
        Stock Option Agreement between Canyon Copper Corp. and Directors and Officers.(26)                                            
|        |                                                                                                                                                             
|10.77   | Purchase
        and Sale Agreement dated August 5, 2010 between Canyon Copper Corp. and
        ESO Uranium Corp.                                          
|        |                                                                                                                                                             
|14.1    | Code of Ethics.(2)                                                                                                                                          
|        |                                                                                                                                                             
|31.1    | Certification
        of Principal Executive Officer pursuant to Section 302 of the Sarbanes-Oxley
        Act of 2002.                                     
|        |                                                                                                                                                             
|31.2    | Certification
        of Principal Financial Officer pursuant to Section 302 of the Sarbanes-Oxley
        Act of 2002.                                     

41

---

|Exhibit |                                                                                                                                                                       
|------- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------
|Number  | Description of Exhibit                                                                                                                                                
|        |                                                                                                                                                                       
|32.1    | Certification
        of Principal Executive Officer pursuant to 18 U.S.C. Section 1350, as
        adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
|        |                                                                                                                                                                       
|32.2    | Certification
        of Principal Financial Officer pursuant to 18 U.S.C. Section 1350, as
        adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
|        |                                                                                                                                                                       
|99.1    | Audit Committee
        Charter.(2)                                                                                                                                   
|        |                                                                                                                                                                       
|99.2    | Disclosure Committee
        Charter.(2)                                                                                                                              

Notes:

|(1)  | Filed with the SEC as an exhibit to our Registration
      Statement on Form SB-2 originally filed on April 26, 2000.
|---- | ---------------------------------------------------------------------------------------------------------------------
|(2)  | Filed with the SEC as an exhibit to our Annual Report on
      Form 10-KSB filed on August 26, 2003.                 
|(3)  | Filed with the SEC as an exhibit to our Current Report on
      Form 8-K filed on April 8, 2004.                     
|(4)  | Filed with the SEC as an exhibit to our Registration
      Statement on Form S-8 filed on June 17, 2004.             
|(5)  | Filed with the SEC as an exhibit to our Current Report on
      Form 8-K filed on August 20, 2004.                   
|(6)  | Filed with the SEC as an exhibit to our Annual Report on
      Form 10-KSB filed on October 8, 2004.                 
|(7)  | Filed with the SEC as an exhibit to our Quarterly Report
      on Form 10-QSB filed on May 23, 2005.                 
|(8)  | Filed with the SEC as an exhibit to our Current Report on
      Form 8-K filed on February 7, 2006.                  
|(9)  | Filed with the SEC as an exhibit to our Quarterly Report
      on Form 10-QSB filed on February 16, 2006.            
|(10) | Filed with the SEC as an exhibit to our Current Report on
      Form 8-K filed on April 10, 2006.                    
|(11) | Filed with the SEC as an exhibit to our Quarterly Report
      on Form 10-QSB filed on May 22, 2006.                 
|(12) | Filed with the SEC as an exhibit to our Current Report on
      Form 8-K filed on September 15, 2006.                
|(13) | Filed with the SEC as an exhibit to our Current Report on
      Form 8-K filed on September 7, 2006.                 
|(14) | Filed with the SEC as an exhibit to our Annual Report on
      Form 10-KSB filed on October 13, 2006.                
|(15) | Filed with the SEC as an exhibit to our Current Report on
      Form 8-K filed on December 13, 2006.                 
|(16) | Filed with the SEC as an exhibit to our Current Report on
      Form 8-K filed on March 26, 2007.                    
|(17) | Filed with the SEC as an exhibit to our Quarterly Report
      on Form 10-QSB filed on May 21, 2007.                 
|(18) | Filed with the SEC as an exhibit to our Annual Report on
      Form 10-KSB filed on September 28, 2007.              
|(19) | Filed with the SEC as an exhibit to our Current Report on
      Form 8-K filed on December 6, 2007.                  
|(20) | Filed with the SEC as an exhibit to our Current Report on
      Form 8-K filed on April 7, 2008.                     
|(21) | Filed with the SEC as an exhibit to our Quarterly Report
      on Form 10-Q filed on May 15, 2008.                   
|(22) | Filed with the SEC as an exhibit to our Current Report on
      Form 8-K filed on July 11, 2008.                     
|(23) | Filed with the SEC as an exhibit to our Current Report on
      Form 8-K filed on January 20, 2009.                  
|(24) | Filed with the SEC as an exhibit to our Current Report on
      Form 8-K filed on May 19, 2009.                      
|(25) | Filed with the SEC as an exhibit to our Current Report on
      Form 8-K filed on July 6, 2009.                      
|(26) | Filed with the SEC as an exhibit to our Current Report on
      Form 8-K filed on August 24, 2009.                   

42

---

SIGNATURES

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

| |     | **CANYON COPPER CORP.**             
| | --- | ------------------------------------
| |     |                                     
| |     |                                     
| | By: | /s/
      Anthony Harvey            
| |     | ANTHONY HARVEY                      
| |     | Chairman and Chief Executive Officer
| |     | Director                            
| |     | (Principal Executive Officer)       
| |     | Date: September 27, 2010            
| |     |                                     
| |     |                                     
| |     |                                     
| | By: | /s/
      Kurt Bordian              
| |     | KURT BORDIAN                        
| |     | Chief Financial Officer             
| |     | (Principal Financial Officer)       
| |     | Date: September 27, 2010            

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

Signature
    
    Title
    DateChairman, Chief Executive Officer and/s/
      Anthony Harvey
    
    Director
    September 27, 2010ANTHONY HARVEY
    
    (Principal Executive Officer)/s/
      Benjamin Ainsworth
    
    President, Treasurer and Director
    September 27, 2010BENJAMIN AINSWORTH/s/ Kurt
      Bordian
    
    Chief Financial Officer
    September 27, 2010KURT BORDIAN
    
    (Principal Financial Officer)/s/
      Bryan Wilson
    
    
    September 27, 2010BRYAN WILSON
    
    Director/s/
      James Yates
    
    
    September 27, 2010JAMES YATES
    
    Director


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