SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549

                                   FORM 10KSB

[X]      ANNUAL  REPORT  PURSUANT  TO  SECTION  13 OR  15(d)  OF THE  SECURITIES
         EXCHANGE ACT OF 1934 For the fiscal year ended January 31, 2005

[   ]    TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
         SECURITIES EXCHANGE ACT OF 1934
         For the transition period from _________ to ____________

         Commission File No. 000-49995

                            AMERICAN GOLDFIELDS INC.
             (Exact name of Registrant as specified in its charter)

          NEVADA                                          71-0867612
-------------------------------------                     ----------
(State or other jurisdiction of                  (I.R.S. Employer
incorporation or organization)                   Identification Number)

200-4170 STILL CREEK DRIVE
BURNABY, B.C. CANADA, V5C 6C6                                 V5C 6C6
------------------------------------                          -------
(Address of principal executive offices)                    (Zip Code)

Registrant's telephone number, including area code:           (604) 299-6600
                                                              --------------

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

Securities registered pursuant to Section 12 (g) of the Act:
COMMON STOCK, PAR VALUE $0.001 PER SHARE

Check  whether  the issuer  (l) has filed all  reports  required  to be filed by
Section 13 or 15(d) of the  Exchange  Act during the past 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. [ X ] Yes [ ]
No

Check if there is no disclosure of delinquent  filers in response to Item 405 of
Regulation  S-B is not  contained  in  this  form,  and no  disclosure  will  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-KSB
or any amendment to this Form 10-KSB. [ ]

Revenues for fiscal year ended January 31, 2005 were 0.

The  aggregate  market  value of the voting stock held by  non-affiliates  as of
April 28, 2005 is: $37,106,182

The number of shares of the issuer's  Common Stock  outstanding  as of April 28,
2005 is 25,842,878.

Transitional Small Business Disclosure Format (check one):  Yes [   ]   No [X ]


<PAGE>


                                     PART I

ITEM 1.  DESCRIPTION OF BUSINESS

GENERAL

American Goldfields Inc. (the "Company" or "we"), f/k/a Baymont Corporation,  is
a natural  resource  exploration  stage company  engaged in the  acquisition and
exploration of properties for deposits of gold or silver.  We were  incorporated
on December 21, 2001 under the laws of the State of Nevada.  Since then, we have
engaged  primarily in the  acquisition  and  exploration of mining  interests in
properties  that may potentially  have deposits of gold and silver.  To date, we
have not earned any revenues.

In December 2001, we caused the  incorporation  of our wholly owned  subsidiary,
Baymont  Explorations  Inc.,  under the laws of British  Columbia.  Through this
subsidiary  we acquired a 75%  undivided  interest in a group of mineral  claims
known as the Bor Claims,  being four mineral claims covering a total area of 247
acres  located  in the  Omineca  Mining  Division  of the  Province  of  British
Columbia,  Canada.  The interest was purchased from Lorne B. Warren of Smithers,
British  Columbia,  the beneficial owner of the claims,  for US$2,500.  In April
2004 we terminated our interest in this property.

On various  dates in 2004 and 2005,  we entered into  separate  agreements  with
MinQuest Inc.  ("MinQuest") granting us an option to purchase 100% of MinQuest's
mining  interests in six  different  properties  located in various parts of the
State of Nevada, which we plan to explore for the purpose of determining whether
there are any commercially  exploitable  deposits of gold or silver. None of the
properties  presently has any mineral  deposits.  The properties are undeveloped
and do not contain any open-pit or underground  mines.  There is no mining plant
or  equipment  located on the  properties,  and there is no power  supply to the
properties.  Our planned  exploration  program is  exploratory  in nature and no
mineral reserves may ever be found.

Further  exploration  of all of our mineral  claims is  required  before a final
determination as to their viability can be made. No commercially  viable mineral
deposit may exist on our mineral claims.  Our plan of operations is to carry out
exploration  work on these  claims in order to  ascertain  whether  they possess
deposits of gold or silver.  We can provide no assurance  to investors  that our
mineral claims contain a commercially  viable mineral deposit until  appropriate
exploratory work is done and an evaluation based on that work concludes  further
work programs are justified. At this time, we definitely have no reserves on our
mineral claims.

CORPORATE HISTORY

From the date of its  incorporation  until  February  5, 2004,  the  Company was
controlled  by its sole  officer  and  director,  Mr.  Alfredo De  Lucrezia.  On
February 5, 2004 Mr.  Lucrezia  appointed  Donald Neal and Gregory  Crowe to the
Board and resigned as the Company's sole officer. Mr. Neal was duly appointed as
the Chief Executive Officer, Chief Financial Officer, Treasurer and Secretary of
the Company. Mr. Neal's appointment to the Board became effective on February 5,
2004,  and Mr. Crowe became a member of the Board on February 23, 2004, ten days
after the mailing of the Information  Statement  regarding such changes. On such
date, Mr. Lucrezia resigned as a director of the Company.

On February 10, 2004, Mr. Lucrezia sold 3,000,000 shares of Common Stock to each
of Donald Neal and Gregory  Crowe.  The purchase  price for each share of Common
Stock was $0.035.  Mr.  Lucrezia no longer holds any shares of capital  stock or
other equity in the Company.

On February  23, 2004,  the Company  approved a 6:1 forward  stock  split.  As a
result of the stock split, an additional  44,928,565 shares of common stock were
issued. The par value of the common stock remains unchanged at $0.001 per common
share but the authorized  number of common stock  increased to 600,000,000  from
100,000,000.

On February 24, 2004,  the Company and a majority of the Company's  stockholders
authorized  the changing of the Company's name to American  Goldfields  Inc. The
name change became effective March 31, 2004.

On March 31, 2004,  each of Messrs.  Neal and Crowe returned  15,000,000  shares
(such  number  reflects  the 6:1 stock split) of common stock to treasury for no
proceeds.  The  Company  did not  record  a gain or  loss  as a  result  of this
transaction.  Since it is customary for a mining exploration  company to acquire
properties with the issuance of stock, this is an option which Messrs.  Neal and
Crowe  considered  not only feasible and  reasonable,  but the only  practicable
method for the  company to acquire  property in light of the  company's  current
financial  condition.  The  stockholders/directors  determined  that they  would
prefer to dilute their personal equity  interests in the company now rather than
have the stockholders  incur significant  dilution in the future when, and if, a
potential seller feels that the directors of the company have too significant of
an equity interest.

On May 26, 2004,  Mr. Richard Kern joined the Board of Directors of the Company.
Mr. Kern is also the  President of MinQuest  Inc. All of the  Company's  current
mineral properties have been optioned from MinQuest.  In addition,  MinQuest has
been  engaged by the Company as its  principal  exploration  contractor  for all
exploration  performed  on the  Company's  current  properties.  As a result,  a
significant portion of the Company's expenses have been the result of activities
performed  directly  by Mr.  Kern or by  subcontractors  managed by Mr.  Kern or
MinQuest.

COMPETITION

The mineral exploration  industry,  in general,  is intensively  competitive and
even if  commercial  quantities  of ore are  discovered,  a ready market may not
exist for sale of same.  Numerous  factors  beyond  our  control  may affect the
marketability  of  any  substances  discovered.  These  factors  include  market
fluctuations,  the  proximity  and  capacity  of natural  resource  markets  and
processing equipment, government regulations,  including regulations relating to
prices,  taxes,  royalties,  land tenure,  land use,  importing and exporting of
minerals and environmental protection.  The exact effect of these factors cannot
be accurately predicted,  but the combination of these factors may result in our
not receiving an adequate return on invested capital.

COMPLIANCE WITH GOVERNMENT REGULATION

We will be required  to comply with all  regulations,  rules and  directives  of
governmental  authorities and agencies applicable to the exploration of minerals
in the  United  States.  The  federal  government  and  various  state and local
governments  have adopted  laws and  regulations  regarding  the  protection  of
natural  resources,  human  health and the  environment.  We will be required to
conduct all  exploration  activities in accordance  with all applicable laws and
regulations.  These may include  requiring  working  permits for any exploration
work that  results in physical  disturbances  to the land and  locating  claims,
posting claims and reporting work performed on the mineral claims.  The laws and
regulations may tell us how and where we can explore for natural  resources,  as
well as environmental  matters relating to exploration and development.  Because
these laws and  regulations  change  frequently,  the costs of  compliance  with
existing  and  future   environmental   regulations  cannot  be  predicted  with
certainty.

Any  exploration or production on United States Federal land will have to comply
with the Federal Land Management  Planning Act which has the effect generally of
protecting the environment.  Any exploration or production on private  property,
whether owned or leased, will have to comply with the Endangered Species Act and
the Clean Water Act. The costs of complying  with  environmental  concerns under
any of these acts varies on a case by case basis. In many instances the cost can
be prohibitive to development.  Environmental costs associated with a particular
project must be factored into the overall cost  evaluation of whether to proceed
with the project.

There are no costs to us at the present time in connection  with compliance with
environmental laws. However, since we do anticipate engaging in natural resource
projects,  these  costs could  occur at any time.  Costs  could  extend into the
millions of dollars for which we could be liable. In the event of liability,  we
would be entitled to contribution from other owners so that our percentage share
of a particular  project would be the percentage  share of our liability on that
project.  However,  other owners may not be willing or able to share in the cost
of the  liability.  Even if liability is limited to our  percentage  share,  any
significant liability would wipe out our assets and resources.

EMPLOYEES

We have no employees  as of the date of this report other than Mr.  Donald Neal,
our sole  officer.  Our sole  officer and three  directors  (one of which is Mr.
Neal) provide planning and organizational services for us on a part-time basis.

Any other services  required will be conducted  largely through  consultants and
other third parties.

RESEARCH AND DEVELOPMENT EXPENDITURES

We have  not  incurred  any  research  or  development  expenditures  since  our
incorporation.

SUBSIDIARIES

We  have  incorporated  a  wholly-owned  British  Columbia  subsidiary,  Baymont
Explorations Inc.

PATENTS AND TRADEMARKS

We do not own any patent or trademark.

FACTORS THAT MAY AFFECT FUTURE RESULTS

WE HAVE A GOING CONCERN  OPINION FROM OUR AUDITORS,  INDICATING THE  POSSIBILITY
THAT WE MAY NOT BE ABLE TO CONTINUE TO OPERATE.

The Company has incurred net losses of $418,970 for the period from December 21,
2001  (inception)  to January  31,  2005,  and has no  revenues.  We  anticipate
generating  losses for future  periods.  Therefore  we may be unable to continue
operations  in the  future  as a going  concern.  Our  plans to deal  with  this
uncertainty  include raising  capital.  There can be no assurance that our plans
can be  realized.  No  adjustment  has been made in the  accompanying  financial
statements to the amounts and  classification  of assets and  liabilities  which
could result  should we be unable to continue as a going  concern.  If we cannot
continue  as a viable  entity,  our  shareholders  may lose some or all of their
investment in American Goldfields Inc.

WE WILL REQUIRE  ADDITIONAL FUNDS TO ACHIEVE OUR CURRENT  BUSINESS  STRATEGY AND
OUR INABILITY TO OBTAIN FUNDING WILL CAUSE OUR BUSINESS TO FAIL.

Based upon current plans, we expect to incur operating losses in future periods.
This will happen because there are expenses  associated with the acquisition and
exploration of the natural resource properties. We will need to raise additional
funds  through  public  or  private  debt or  equity  sales in order to fund our
operations and fulfill our contractual obligations.  These financings may not be
available when needed.  Even if these  financings  are  available,  it may be on
terms that we deem unacceptable or are materially adverse to your interests with
respect  to   dilution  of  book  value,   dividend   preferences,   liquidation
preferences,  or other terms.  Our inability to obtain  financing  would have an
adverse  effect on our ability to implement our current  exploration  in Nevada,
and as a result,  could  require us to diminish or suspend  our  operations  and
possibly cease our existence. Obtaining additional financing would be subject to
a number of factors,  including the market  prices for the mineral  property and
silver  and  copper.  These  factors  may  make  the  timing,  amount,  terms or
conditions of additional financing unavailable to us.

IF WE DO NOT  COMPLETE  THE REQUIRED  OPTION  PAYMENTS  AND CAPITAL  EXPENDITURE
REQUIREMENTS  MANDATED IN OUR RESPECTIVE  AGREEMENTS WITH MINQUEST, WE WILL LOSE
OUR INTEREST IN THAT RESPECTIVE PROPERTY AND OUR BUSINESS MAY FAIL.

If we do not make all of the property payments to MinQuest or incur the required
expenditures  in accordance with the respective  property  option  agreements we
will lose our option to purchase the  respective  property for which we have not
made the  payments  and may not be able to  continue  to  execute  our  business
objectives if we are unable to find an alternate exploration interest. Since our
payment obligations are non-refundable,  if we do not make any payments, we will
lose any payments previously made and all our rights to the properties.

OUR DIRECTORS  HAVE THE ABILITY TO EXERCISE  SIGNIFICANT  INFLUENCE OVER MATTERS
SUBMITTED  FOR  SHAREHOLDER  APPROVAL AND THEIR  INTERESTS MAY DIFFER FROM OTHER
SHAREHOLDERS.

By virtue of a  Shareholders'  Agreement dated February 10, 2004 between Messrs.
Neal and Crowe our directors have the ability to nominate and appoint a majority
to our Board.  Since the agreement also provides that the two shareholders shall
vote their respective 3,000,000 shares together, they have significant influence
in  determining  the  outcome  of any  corporate  transaction  or  other  matter
submitted to the shareholders for approval. This could have a significant impact
on  mergers,  acquisitions,  and  the  sale of all or  substantially  all of our
assets, and also to prevent or cause a change of control.

BECAUSE ALL OF OUR MINERAL  PROPERTIES  HAVE BEEN OPTIONED FROM MINQUEST AND ONE
OF THE  DIRECTORS  OF THE  COMPANY IS ALSO A  DIRECTOR  OF  MINQUEST,  POTENTIAL
CONFLICTS OF INTEREST  COULD IMPACT OUR  BUSINESS.

Mr. Kern joined the Board of Directors of the Company on May 26, 2004.  Mr. Kern
is also the president of MinQuest.  All of the Company's mineral properties have
been  optioned  from  MinQuest.  As a result,  MinQuest and Mr. Kern are related
parties to the  Company  and both  MinQuest  and Mr.  Kern  receive  substantial
payments from the Company.  In addition,  the Company has agreed to use Mr. Kern
as the  primary  contractor  on  exploration  undertaken  to  date on all of its
properties. The potential exists for conflicts of interest to occur from time to
time that could  adversely  affect the Company's  ability  conduct its business.
Also,  Mr. Kern is the most  knowledgeable  person  regarding the historical and
current state of exploration on the mineral properties currently optioned by the
Company.  If Mr. Kern were to terminate his relationship  with the Company,  the
Company would be adversely  affected while we found a suitable  replacement.  To
date,  there have not been any  conflicts  of  interest  between the Company and
MinQuest or Mr.  Kern.

BECAUSE OF THE  SPECULATIVE  NATURE OF EXPLORATION AND  DEVELOPMENT,  THERE IS A
SUBSTANTIAL RISK THAT OUR BUSINESS WILL FAIL.

The search for valuable  natural  resources as a business is extremely risky. We
can provide  investors  with no assurance  that the property we have optioned in
Nevada  contains  commercially  exploitable  reserves.  Exploration  for natural
reserves is a speculative  venture  involving  substantial  risk. Few properties
that are explored are ultimately developed into producing  commercially feasible
reserves. Problems such as unusual or unexpected formations and other conditions
are involved in mineral exploration and often result in unsuccessful exploration
efforts.  In such a case,  we would be unable to  complete  our  business  plan.

BECAUSE OUR SOLE EXECUTIVE OFFICER DOES NOT HAVE FORMAL TRAINING SPECIFIC TO THE
TECHNICALITIES OF MINERAL EXPLORATION,  THERE IS A HIGHER RISK OUR BUSINESS WILL
FAIL

Mr.  Neal,  our sole  executive  officer,  does not have  formal  training  as a
geologist or in the technical  aspects of  management  of a mineral  exploration
company.  Our management lacks technical  training and experience with exploring
for,  starting,  and operating a mine.  With no direct training or experience in
these areas, our management may not be fully aware of the specific  requirements
related to working within this industry. Consequently, our operations, earnings,
and ultimate financial success could suffer irreparable harm due to management's
lack of experience in this industry.

BECAUSE  WE HAVE  NOT  COMMENCED  BUSINESS  OPERATIONS,  WE FACE A HIGH  RISK OF
BUSINESS FAILURE DUE TO OUR INABILITY TO PREDICT THE SUCCESS OF OUR BUSINESS

We have just begun the initial stages of exploration of our mineral claims,  and
thus have no way to evaluate the likelihood  that we will be able to operate the
business  successfully.  We were  incorporated  on December 21, 2001 and to date
have been involved primarily in organizational  activities,  and the acquisition
and exploration of the mineral claims. We have not earned any revenues as of the
date of this report.

BECAUSE  OF THE  UNIQUE  DIFFICULTIES  AND  UNCERTAINTIES  INHERENT  IN  MINERAL
EXPLORATION AND THE MINING BUSINESS, WE FACE A HIGH RISK OF BUSINESS FAILURE

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.

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, 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 can provide  investors with no assurance that we will
generate any operating revenues or ever achieve profitable operations. If we are
unsuccessful in addressing these risks, our business will most likely fail.

BECAUSE OF THE SPECULATIVE NATURE OF EXPLORATION OF MINERAL PROPERTIES, THERE IS
SUBSTANTIAL  RISK THAT NO MINERAL  DEPOSITS WILL BE FOUND AND THIS BUSINESS WILL
FAIL

The search for valuable  minerals as a business is extremely risky.  Exploration
for minerals is a speculative  venture necessarily  involving  substantial risk.
The  expenditures  to be made by us in the exploration of the mineral claims may
not result in the  discovery of mineral  deposits.  Problems  such as unusual or
unexpected  formations and other conditions are involved in mineral  exploration
and often result in unsuccessful  exploration  efforts. In such a case, we would
be unable to complete our business plan.

BECAUSE OF THE INHERENT DANGERS INVOLVED IN MINERAL EXPLORATION, THERE IS A RISK
THAT WE MAY INCUR LIABILITY OR DAMAGES AS WE CONDUCT OUR BUSINESS

The search for valuable minerals involves numerous hazards.  As a result, 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.

BECAUSE ACCESS TO OUR MINERAL CLAIMS MAY BE RESTRICTED BY INCLEMENT WEATHER,  WE
MAY BE DELAYED IN OUR EXPLORATION

Access to our mineral  properties may be restricted through some of the year due
to weather in the area. As a result, any attempt to test or explore the property
is largely  limited to the times when  weather  permits such  activities.  These
limitations can result in significant delays in exploration efforts. Such delays
can have a significant negative effect on our results of operations.

BECAUSE OUR  PRESIDENT  HAS ONLY  AGREED TO PROVIDE HIS  SERVICES ON A PART-TIME
BASIS,  HE MAY NOT BE ABLE OR WILLING TO DEVOTE A  SUFFICIENT  AMOUNT OF TIME TO
OUR BUSINESS OPERATIONS, CAUSING OUR BUSINESS TO FAIL

Mr. Neal,  our sole  officer,  provides his  management  services to a number of
companies. Because we are in the early stages of our business, Mr. Neal will not
be  spending a  significant  amount of time  working for the  Company.  Mr. Neal
expects to expend  approximately five hours per week on our business.  Later, if
the demands of our business  require the full  business  time of Mr. Neal, he is
prepared to adjust his timetable to devote more time to our  business.  However,
it still  may not be  possible  for Mr.  Neal to devote  sufficient  time to the
management of our business, as and when needed, especially if the demands of Mr.
Neal's other interests  increase.  Competing demands on Mr. Neal's time may lead
to a divergence between his interests and the interests of other shareholders.

RISKS RELATED TO LEGAL UNCERTAINTY AND REGULATIONS

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 will be  subject  to the  federal,  state and local laws of the
United  States and  Nevada as we carry out our  exploration  program.  We may be
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.  While our
planned exploration program budgets for regulatory  compliance,  there is a risk
that new  regulations  could increase our costs of doing business and prevent us
from carrying out exploration program.


ITEM 2.  DESCRIPTION OF PROPERTIES

We  currently  maintain  our  corporate  office at 200-4170  Still Creek  Drive,
Burnaby,  B.C.,  Canada,  at a cost of  $400  per  month.  This  rental  is on a
month-to-month basis without a formal contract

We have interests in the following real properties:

GILMAN PROPERTY

On May 7, 2004, the Company  completed the formal agreement with MinQuest for an
option to acquire a 100% interest in a property known as the "Gilman  Property."
Concurrently, the company made the first $10,000 option payment to MinQuest. The
agreement  requires certain  additional  minimum annual property option payments
with a total of $75,000  required to be paid by May 15, 2009. The agreement also
requires minimum annual exploration  expenditures with a grand total of $450,000
in  expenditures  required to be incurred on the property by May 15,  2009.  The
agreement is subject to a 3% royalty  payable to MinQuest with the Company being
able to repurchase up to  two-thirds of the royalty for  $1,000,000  for each 1%
repurchased.  The  Company  is not  required  to use  MinQuest  for  exploration
undertaken on the Gilman Property.  However, at its discretion,  the Company has
engaged MinQuest as the principal contractor for exploration  performed to date.
On March 22, 2005,  the Company  executed an  amendment  to the Gilman  Property
Option  Agreement.  As a result of the  amendment,  the Company's  obligation to
incur $50,000 in exploration expenditures on the Gilman Property by May 2005 was
moved to May 2009.  All other terms and  commitments  of the original  agreement
remain unchanged.

DESCRIPTION AND LOCATION OF THE GILMAN PROPERTY

The Gilman  Property  is  located  in Lander  County,  Nevada  approximately  28
kilometers  south of the  town of  Austin,  282  kilometers  east of  Reno.  The
property  consists  of 19  contiguous,  unpatented  mineral  claims  covering an
approximate  390 acre area over the eastern  flank of the  Toiyabe  Range on the
North  Toiyabe  Peak  and  Kingston  US  Geological  Survey  7  1/2'  quadrangle
mapsheets.  The property is accessed from Austin by following  State Highway 376
for 16  kilometers.  A gravel road leads west 3.5 kilometers to the main area of
interest on the property.

Land claims in the  district  are  administered  under  Department  of Interior,
Bureau of Land Management ("BLM") and Department of Agriculture,  Forest Service
("USFS")  under the Federal Land Policy and  Management  Act of 1976. The Gilman
claims cover  portions of Sections 7, 8, 17, and 18 in Township 16 North,  Range
44 East in Lander County, Nevada. None of the claims have been legally surveyed.
All of the  claims  are on USFS  administered  lands,  while  the  access to the
property is across BLM land.

Three of the claims on the Gilman  Property  are  registered  in the name of Mr.
Herb Duerr.  Under a Letter  Agreement dated July 25, 2002,  MinQuest leased the
three claims.  The Letter Agreement  permits MinQuest to assign the property and
terms of the agreement to third parties.  This  agreement  covers an approximate
1.6  kilometer  area.  MinQuest  located an  additional 16 claims which all fall
within the area of  interest  covered  by the  agreement  MinQuest  has with Mr.
Duerr. Mr. Duerr subsequently  granted to MinQuest the rights necessary to allow
MinQuest  to enter into  agreements  with third  parties for the  additional  16
claims. To maintain the claims in good standing,  maintenance fees totaling $135
per  claim  are  payable  to the BLM on or  before  September  1 of  each  year.
Recording fees of approximately $15 per claim are required by Lander County each
year.

All of the Gilman Property is within the Toiyabe National  Forest,  administered
by the USFS.  Exploration  within national forest lands must be permitted by the
USFS. Prior to undertaking  exploration  activities a Plan of Operations must be
submitted to the USFS for review.  An environmental  assessment and public input
is required necessitating an approximate four month lead time before undertaking
any  disturbance.  A  reclamation  bond to cover costs of such  disturbances  is
required to be posted with the USFS. Access to the Gilman Property is across BLM
administered land. As there are existing roads and tracks in place, no permit is
required to cross these lands. No permits have been applied for or are currently
issued for the Gilman Property.

EXPLORATION HISTORY OF THE GILMAN PROPERTY

Silver was discovered in Austin in 1862.  Fifty  kilometers  south of the Gilman
Property,  gold was  discovered in veins at Round  Mountain in 1901.  Production
from lode veins in the Round Mountain district  continued  intermittently  until
1969 while large tonnage, low-grade mining activity continues in the area to the
current  day.  There is no known  production  or  history  data from the  Gilman
Property,  but  several  pits and two adits are  evidence  of prior  exploration
activities.  Numerous  companies  conducted  property  reviews  and  sampled the
showings in the area, which have locally returned high concentrations of gold.

GEOLOGY OF THE GILMAN MINERAL CLAIMS

The geology of the property is described in a December,  2002 report by Geoffrey
N.  Goodall,   President  of  Global  Geological  Consultants  Ltd.,  a  private
consulting  firm.  Mineralization  on the Gilman  Property is associated  with a
steep, easterly dipping and northerly trending range front fault.  Jasperoid and
massive  quartz  veining  have  developed  along the fault  zone and local  east
trending faults offset the jasperoid. Sulphide rich quartz veining occurs at the
base of the  silicified  fault  zone.  Sulphides  identified  at Gilman  include
pyrite, arsenopyrite,  galena, chalcopyrite and sphalerite. The primary focus of
exploration  at the  Gilman  Property  is  for  structurally  hosted  high-grade
gold/silver  mineralization.  Mineralization  at Gilman  consists of a gossanous
shear zone and quartz  veins along the base of a range  front fault zone.  Gold,
silver,  and copper  associated  with the fault  system have been located in the
area.

CURRENT STATE OF EXPLORATION

The Gilman claims presently do not have any mineral reserves.  The property that
is the subject to our  mineral  claims is  undeveloped  and does not contain any
open-pit or underground  mines. There is no mining plant or equipment located on
the property that is the subject of the mineral  claim.  Currently,  there is no
power  supply  to  the  mineral  claim.  Our  planned   exploration  program  is
exploratory in nature and no mineral reserves may ever be found.

GEOLOGICAL EXPLORATION PROGRAM

Evaluation of the Gilman claims to date has  consisted of the  preparation  of a
topographic  base  map,  and  surface  and  underground   geochemical  sampling.
Significant  gold and silver  values have been found  associated  with the range
front  quartz  vein.  Values up to 1.41 oz/ton gold and 24.9 oz/ton  silver have
been  obtained in surface and  underground  sampling.  Future  exploration  will
include  drilling of the range front fault.  Scheduling of drilling is difficult
because  of the  unknown  time to permit  holes on Forest  Service  lands.  This
process can often take six months or more.

IMPERIAL PROPERTY

On June 30, 2004,  the Company  entered into an agreement  with  MinQuest for an
option  to  acquire  a 100%  interest  in a  property  known  as  the  "Imperial
Property." The company made the first  scheduled  option payment of $60,000 upon
signing the agreement.  The agreement requires certain additional minimum annual
property option payments with a total of $80,000  required to be paid by July 1,
2008. The agreement also requires minimum annual exploration expenditures with a
grand total of $500,000 in expenditures  required to be incurred on the property
by the July 1, 2009.  The property  option  agreement is subject to a 3% royalty
payable to MinQuest.  The Company is required to use  MinQuest  for  exploration
conducted on the Imperial Property.

DESCRIPTION AND LOCATION OF THE IMPERIAL PROPERTY

The Imperial Property is located in Esmeralda County,  Nevada,  approximately 60
kilometres southwest of Tonopah and 300 kilometers northwest of Las Vegas in the
Railroad  Springs Mining  District.  The property  consists of 22 mineral claims
elongated in an east-west direction, covering approximately 450 acres located in
Railroad Pass between the  Montezuma  Range to the northeast and the Silver Peak
Range  to the  southwest.  The  property  covers  portions  of two  adjacent  US
Geological Survey 7 1/2' quadrangle map sheets:  Lida Wash, Nevada and Montezuma
Peak, SW Nevada.  The center of the property is situated at  approximately  117o
31' 43" West longitude and 37o 33' North latitude.

Land claims in the  district  are  administered  under  Department  of Interior,
Bureau of Land  Management  ("BLM") under the Federal Land Policy and Management
Act of 1976.  The Imperial  claims cover  portions of Sections 34, 35, and 36 in
Township 4S, Range 40East in Esmeralda County,  Nevada.  None of the claims have
been legally  surveyed.  The property is most easily accessed from the community
of Silver Peak, Nevada by following US route 95 west from Tonopah for a distance
of 35  kilometers  and  turning  south  onto  paved  State  Highway  295  for 21
kilometers  and then  west on a  secondary  gravel  road for 500  meters  to the
eastern claim boundary.

MinQuest is the  registered  owner of 12 of the claims that make up the Imperial
Property.  Ten of the claims (Lida 1 to Lida 10) are registered to Richard Kern,
Michael Forth, and James Motter. Under the terms of a Letter Agreement, the Lida
claims have been leased to MinQuest  for a period of 20 years.  The lease allows
MinQuest to transfer  title to third  parties  providing  all  conditions of the
original agreement are met. To maintain the claims in good standing, maintenance
fees totaling $135 per claim are payable to the BLM on or before  September 1 of
each year.  Recording fees of approximately $15 per claim are required by Lander
County each year.

EXPLORATION HISTORY OF THE IMPERIAL PROPERTY

The Imperial was first  developed in the 1920's but  apparently had little or no
production  until the late 1930's.  The  Imperial  Mine  produced  approximately
10,000 tons of ore grading +0.5 oz/ton was probably  shut down at the  beginning
of World War II. The mine has two adits, the longest of which has  approximately
2,600 feet of drifts and crosscuts.  A 200 foot shaft,  which is not accessible,
is also located on the property.

The property has been explored by Energy Reserves Group, Goldsil Mining, Felmont
Oil, and Nevada Star  Resource  Corporation.  Felmont  conducted the bulk of the
work during 1983 - 1984 including drilling 19 reverse circulation holes. Five of
these holes intercepted significant thickness of +0.03 oz/ton oxide gold "Carlin
style"  mineralization.  Six of their holes were drilled on the area that hosted
the  Imperial  Mine.  The best  hole has a 30 meter  intercept  of 0.036  oz/ton
including 6 meters of 0.062  oz/ton.  No other holes were drilled on this target
that is more than a mile long.  Felmont dropped the property partly because they
lost the  rights to the  portion of the claim  covering  the  Imperial  Mine and
partly because they were taken over by Homestake.

Nevada Star  conducted a soil survey over the  non-Imperial  Mine claim block in
1987 and partially  tested the area around two of the better  Felmont holes with
shallow  close-spaced  (33 m) grid drilling.  This work which defined an area of
gold  mineralization  and confirmed the presence of  Carlin-style  gold in silty
rocks  adjacent  to  northeast  trending  high angle  feeder  faults,  was to be
followed up by drill testing of this and several other targets.  However, Nevada
Star was unable to raise the capital  needed to continue  and  relinquished  the
property.

GEOLOGY OF THE IMPERIAL MINERAL CLAIMS

The geology of the property is described in a December,  2002 report by Geoffrey
N.  Goodall,   President  of  Global  Geological  Consultants  Ltd.,  a  private
consulting firm. Regionally,  the Imperial Property is located within the Walker
Lane which hosts several  precious  metal  deposits.  Two distinct types of gold
mineralization occur on the Imperial Property. The first type is associated with
high angle bodies of  jasperoid  that outcrop  along the  east-west  axis of the
property.  The second type of  mineralization is identified from drill hole data
in the eastern part of the property. Here gold mineralization is associated with
flat lying  bedding  and is  disseminated  throughout  highly  altered  limonite
stained decalcified siltstones.

Structurally,  two fault sets  appear  closely  related to  mineralization.  The
Imperial  Fault  and  other  associated  west-northwest  structural  zones  have
received the bulk of the  exploration  within the district.  Numerous  northeast
trending  faults,  some of which are shown by soil  geochemistry,  have received
little attention as possible feeders. Nearly all gold anomalies from the eastern
half of the claims have a northeast  trend.  These  anomalies  are thought to be
leakage along feeder faults.

Three primary  Carlin-type  targets are present at Imperial.  The first and most
important is the Imperial  Target that has only one hole on the favourable  side
of the approximately 1,600 meter long structure.  The second target,  called the
Central  Target is an  open-ended  500 meter long gold in soil  anomaly  along a
northeast  trending fault system.  A final target is a large anomaly under cover
in the central  portion of the claim  group.  The anomaly is 400 meters long and
has gold in soil anomaly at its west end.

A final target is a high-grade gold mineralization hosted by the Imperial fault.
Gold grades up to 2 oz/ton are recorded on underground stope maps.

CURRENT STATE OF EXPLORATION

The Imperial  claims  presently do not have any mineral  reserves.  The property
that is the subject to our mineral  claims is  undeveloped  but does contain two
adits,  the  longest  of  which  has  approximately  2,600  feet of  drifts  and
crosscuts. There is no mining plant or equipment located on the property that is
the subject of the mineral  claim.  Currently,  there is no power  supply to the
mineral claim.

Exploration  of  the  enargite-bearing   high-grade  vein  system  is  warranted
simultaneously with Carlin-style exploration. Our planned exploration program is
exploratory in nature and no mineral reserves may ever be found.

GEOLOGICAL EXPLORATION PROGRAM

The Company has budgeted  approximately $180,000 for an exploration program that
will focus on the five high-grade vein and disseminated  gold targets within the
Imperial  Property.  The  program is  expected  to take a total of six months to
complete and will include approximately 30 reverse circulation holes for a total
of 4,500 feet of  drilling.  As of the end of  February,  2005,  the Company had
completed  10 holes for a total of 2,995 feet.  In addition to the  drilling the
Company has also conducted underground sampling. A total of 40 samples have been
taken of quartz vein related mineralization underground. This work confirmed the
presence  of high grade  values in the two adits  sampled  and will help  target
further drilling.

Of the first six drill holes drilled,  several intersected stopes which were not
visible on existing underground maps. This was to be expected to some extent, as
Phase  I of the  drill  program  was  designed  to  test  an  area  of  previous
underground  mining  which had already had  extensive  workings.  Of  particular
interest was drill hole IR-4 which  intersected 10 feet of high grade gold. This
10 foot  interval  (105' to 115')  averages  0.50 oz/ton gold occurs within a 40
foot interval (110' to 140') that averages 0.154 oz/ton gold.

Significant results for IR-4 by 5 foot intervals are as follows:
<TABLE>
<CAPTION>
      HOLE NO.           FROM (FT)          TO (FT)        INTERCEPT (FT)        PPM AU (OZ/TON)
  ------------------ ------------------- --------------- -------------------- ----------------------
<S>                      <C>               <C>               <C>                  <C>
        IR-4                100               105               0.88                 (0.026)
                            105               110               11.60                (0.338)
                            110               115               22.80                (0.666)
                            115               120               2.06                 (0.060)
                            120               125               0.89                 (0.026)
                            125               130               2.01                 (0.059)
                            130               135               1.27                 (0.037)
                            135               140               0.76                 (0.022)
</TABLE>

Phase II of the drilling  program is expected to begin in April,  2005. The goal
of the second phase of the program is intended to test additional high grade and
disseminated gold targets.

A total of 40 channel  samples were taken across veins  exposed in the upper and
lower adits. Results of the channel samples are noted in the table below.

                            IMPERIAL UPPER ADIT RESULTS

     SAMPLE NUMBER       WIDTH (FT)        GOLD (OZ/TON)        SILVER (OZ/TON)
  -------------------- ---------------- -------------------- -------------------
  -------------------- ---------------- -------------------- -------------------
         IUA 0               6.0               0.232                 0.123
        IUA 10               4.0               0.507                 0.464
        IUA 30               4.0               0.035                 0.020
        IUA 40               4.0               0.275                 0.079
        IUA 50               2.5               0.248                 0.201
        IUA 65               3.0               0.340                 0.239
        IUA 70               3.0               0.271                 0.213
        IUA 80               3.0               0.165                 0.239
        IUA 93               2.0               0.249                 0.181
        IUA 105              4.0               0.331                 0.175
        IUA 120              3.0               0.615                 0.978
        IUA 128              2.5               1.517                 1.083
        IUA 140              1.5               0.106                 0.149
        IUA 150              1.5               0.045                 0.018
        IUA 175              2.5               7.636                 0.251
        IUA 190              3.0               0.112                 0.032
        IUA 210              3.0               0.127                 0.114
        IUA 230              2.5               0.012                <0.015
        IUA 250              2.0               0.014                 0.018


                            IMPERIAL LOWER ADIT RESULTS

     SAMPLE NUMBER       WIDTH (FT)        GOLD (OZ/TON)        SILVER (OZ/TON)
  -------------------- ---------------- -------------------- -------------------
  -------------------- ---------------- -------------------- -------------------
        ILA 50               1.0               0.143                 0.742
        ILA 70               1.5               0.033                 0.053
        ILA 90               2.5               0.183                 0.850
        ILA 110              3.0               0.154                 0.844
        ILA 137              2.0               0.506                 1.451
        ILA 152              1.5               0.045                 0.085
        ILA 170              1.5               0.004                 0.015
        ILA 202              2.0               0.048                 0.020
        ILA 250              2.5               0.053                <0.015
        ILA 300              3.0               0.004                 0.035
        ILA 350              3.0               0.002                 0.064
        ILA 400              2.0               0.013                 0.015
        ILA 420              2.5               0.341                 0.044
        ILA 430              1.5               0.379                 0.020
        ILA 444              2.0               0.159                 0.020
        ILA 450              3.0               0.102                 0.023
        ILA 460              1.5               0.089                 0.053
        ILA 500              2.5               0.178                 0.397
        ILA 510              3.0               0.497                 0.131
        ILA 520              3.0               0.148                 0.155
        ILA 527              2.0               0.113                 0.018

HERCULES PROPERTY

On October 22, 2004, the Company  entered into an agreement with MinQuest for an
option  to  acquire  a 100%  interest  in a  property  known  as  the  "Hercules
Property."  Concurrent  with the signing of the agreement,  the Company made the
first  property  option  payment of  $20,000.  The  agreement  requires  certain
additional minimum annual property option payments totaling $200,000 and minimum
annual exploration  expenditures  totaling  $4,050,000 to be paid or incurred by
November 25, 2014. The agreement is subject to a 3% royalty  payable to MinQuest
with the Company  being able to  repurchase  up to two-thirds of the royalty for
$3,000,000.

DESCRIPTION AND LOCATION OF THE HERCULES PROPERTY

The  Hercules  Property  is located in Lyon  County,  Nevada,  approximately  40
kilometers southwest of Reno. Access is via 11 kilometers of paved and dirt road
from Dayton.  Hercules is  approximately  16 kilometres  from the Comstock lode.
Land claims in the  district  are  administered  under  Department  of Interior,
Bureau of Land  Management  ("BLM") under the Federal Land Policy and Management
Act of 1976.  MinQuest  holds a 100%  interest  in these  claims via  unpatented
mining claims.

EXPLORATION HISTORY OF THE HERCULES PROPERTY

The Hercules Property was first discovered in 1860 by pioneers during the famous
"Washoe  Rush".  Production  from high grade veins  started as early as 1870 and
occurred  as late as 1956.  The  Hercules  Mine,  located on the  property,  had
production of 5,000 ounces of gold and 20,000 ounces of silver as indicated from
stoping. Recent exploration efforts began in the early 1980's when placer mining
was attempted on the eastern  portion of the property,  below the Hercules Mine.
Since then,  Asamera,  St. Joe,  Horizon Gold,  Phelps Dodge and Adamas\GSL have
conducted  exploration  efforts  totaling  over  US$2,000,000  in  expenditures.
Drilling undertaken by predecessor companies are as follows:

  o   St. Joe        1985        11 RC holes for 2,715 feet (882 m)
  o   Asamera        1985        10 Core holes for 4,314 feet (1,400 m)
  o   Horizon Gold   1986-90     138 RC holes for 18,091 feet (5,874 m)
  o   Phelps-Dodge   1995-97     17 RC holes for a total of 8,805 feet (2,859 m)

A total of 33,925  feet  (11,015  m) in 176 holes  have  been  completed  on the
property.   The  vast  majority  of  the  drilling  targeted  shallow  open  pit
heap-leachable gold mineralization.  No systematic exploration of the high-grade
vein targets has been completed.

GEOLOGY OF THE HERCULES MINERAL CLAIMS

The property lies within the Walker Lane structural corridor. Major mines within
the Walker Lane include the  Comstock,  Tonopah,  Goldfield  and  Bullfrog.  The
Walker Lane is characterized by a strong northwesterly structural fabric causing
easterly  rifting.  As with much of the Walker  Lane rocks at  Hercules  consist
dominantly of Tertiary age pyroclastic  volcanics and  volcaniclastic  sediments
cover the entire property.  The pyroclastic  rocks have been intruded by several
volcanic vents and plugs.  Thin  post-mineral  basalt and rhyodacite of Pliocene
age cover mineralization on the northern and western sides of the property.

The  Hercules   Property   contains  one  of  the  most   significant   untested
Comstock-type  vein systems in the Western U.S.  Although  some mining  occurred
near-surface,  the bulk of the 8.4  million  ounces  of gold and  193.5  million
ounces of silver  mined at  Comstock  occurred  below  1,200 feet (400 m).  This
bonanza grade mineralization  averaged 2.0 oz/ton gold and 50 oz/ton silver. The
depth of erosion of the Hercules  vein system  appears  identical to that of the
nearby Comstock as evidenced by the following:

         1. Multiple parallel veins that should merge at depth.
         2. Presence of low-temperature  alteration minerals such as chalcedony,
         calcite, and kaolinite in exist in veins at current surface.
         3. Presence of low  temperature  elements such as mercury,  arsenic and
         antimony.
         4. A low silver to gold ratio relative to bonanza horizon.
         5. Low base metal content (lead, zinc) relative to bonanza horizon.
         6. Localized  high-grade gold (+0.5 oz/ton) in veins at current erosion
         surface.

The Hercules  mineralization  is largely  localized along two parallel  dip-slip
multi-vein  structures  which trend  north-northeast,  parallel to the  Comstock
structure.  The structures have  near-vertical  dips and have been offset by two
east-west faults.  Gold/silver is hosted by permeable  volcanics/volcaniclastics
as well as by the high-angle structures. The highest grade mineralization occurs
in quartz veins  within the faults.  Silicification  and banded  quartz-adularia
veins are  surrounded  by intense  clay  alteration  grading to weak  propylitic
alteration.

The second target type at Hercules is bulk-minable  heap-leachable  gold/silver.
According to reserves  studies done by Pioneer  Mining  Corporation  and Horizon
Gold Shares,  Inc. the property contains a resource of roughly 217,000 ounces of
gold and  1,571,000  ounces of silver  using  results  from 176 drill  holes and
numerous  channel samples  collected from outcrops,  trenches and road cuts. The
above total contains +0.03 oz/ton (1 g/t)  reserve/resources  from the following
individual target areas:

o        Zones C/D/E  contain 2.4 million tons  grading  0.040 oz/ton (1.36 g/t)
         gold and 0.37  oz/ton  (13 g/t)  silver  within  three  separate  pods.
         Drilling is wide spaced and incomplete between the three pods. The pods
         remain open ended along strike and down dip.  These pods may join along
         strike.  Two claims not owned by MinQuest  cover part of this resource.
         In the past, these claims were leased for reasonable terms.

o        Zone A/B is an extension of the C/D/E/ zone.  The A/B zone  contains an
         additional  +0.03 oz/ton  resource of 300,000 tons grading 0.033 oz/ton
         (1.14 g/t) gold and 0.20 oz/ton (1.37 g/t) silver.

o        The West Cliff Zone  contains an  additional  resource of 1.011 million
         tons  grading  0.047  oz/ton  (1.56 g/t) gold and 0.20 oz/ton (6.8 g/t)
         silver as indicated  in widely  spaced  drilling  and surface  sampling
         results.  Untested  mineralization  occurs  north  of  the  West  Cliff
         resource.  This  area has a 5,000  feet  (1620 m)  strike  length  with
         surface samples including 60 feet (27 m) grading 0.033 oz/ton (1.1 g/t)
         gold).

o        The Loaves Zone has a calculated  +0.03 oz/ton gold resource of 500,000
         tons of 0.040 oz/ton gold and 0.20 oz/ton silver.

All of these resources remain open along strike and at depth.

St. Joe and Horizon Gold  performed  bulk tests from drill  cuttings and surface
samples.  The average recovery for gold was 88%. The process  involved  crushing
and  pulverizing  the sample and completing a bottle roll using over 50 separate
samples.  Although the tests are  encouraging,  further  metallurgy is needed to
determine recoveries of various size fractions.

A bonanza  grade  Comstock  type  gold/silver  deposit is the primary  target at
Hercules.  All of the mineralized vein structures listed previously are targets.
Exploration should begin in areas with higher-grade gold values at surface, with
higher  silver/gold  ratios,  more base metals,  higher  temperature  alteration
suites and where multiple veins occur.  This will ensure the shallowest  targets
will be tested  first.  The most  likely site to start as  indicated  by initial
study is area D and E of the Hercules Mine target. Accurate drilling down dip in
100 m steps will allow  spot  coring of the target  horizon at 300-400 m beneath
the surface.

The secondary  target is open pit  bulk-minable  heap leachable  gold/silver for
which some resources have already been established.  The size and grade of these
resources could be increased by drilling  across their feeder  structures and by
drilling possible extensions.

The West Cliff target is located in the southwest portion of the property.  This
resource is defined by 17 widely spaced drill holes and  underground and surface
channel  sampling  results.   Soil  sampling  and  drilling  suggests  a  second
en-echelon  zone occurs 300 feet (100 m) east of the main zone.  The resource is
open ended for 1000 feet  (305m)  north,  600 feet (180 m) south and down dip to
the west. Only two holes have tested the parallel zone.

The Loaves target consists of a zone of silicified  volcanics  containing banded
quartz  veins.  The zone has a strike  length of over  5,000  feet  (1520 m) and
extends under cover to the northwest. This zone is probably the offset extension
of the West Cliffs  resource.  Only two of ten holes drilled to date have tested
the structure.  These two holes contain  intercepts of +50 feet (15m)  averaging
+0.02 oz/ton (0.67 g/t) gold.  Previous  drilling has targeted the footwall side
of the fault.  Even so, long intervals of anomalous gold with  occasional  short
intervals of higher grade were encountered.  This target requires angle drilling
to test the hanging wall side of the  structure  to penetrate  the fault zone at
depth and along strike.

The  Hercules  Mine and  Extensions  (C\D\E)  targets  cover  the main  Hercules
structure and parallel fault zones.  Drilling and sampling from  underground and
outcrop areas have  encountered  relatively thick intercepts of gold and silver.
This wide spaced drilling (both core and RC) and underground  sampling  indicate
multiple mineralized structures with associated disseminated mineralization. The
core  samples  were only  partially  assayed and may  contain  more gold than is
displayed  on the cross  sections.  The zone remains open for at least 1000 feet
(300 m) north, over 1000 feet (300 m) south. Parallel mineralized structures are
known to exist further to the east within the claim block.  Surface samples from
these structures contain up to 2.5 g/t gold.

The southern of three Loaves targets  contains a small resource from 3 holes and
surface panel  sampling.  Recent channel  sample results  include 33 feet (10 m)
averaging 0.062 oz/ton (2.10 g/t) gold and 0.34 oz/ton (11.6 g/t) silver (Adamas
news release).  Soil sampling  suggests a minimum of 1700 feet (515 m) of strike
length that remains untested.

CURRENT STATE OF EXPLORATION

The Hercules claims have had a significant  amount of exploration  undertaken in
their history.  However,  they do not currently have any mineral  reserves.  The
property that is the subject to our mineral claims is  undeveloped.  There is no
mining  plant or equipment  located on the  property  that is the subject of the
mineral claim.  Currently,  there is no power supply to the mineral  claim.  Our
planned exploration program is exploratory in nature and no mineral reserves may
ever be found.

GEOLOGICAL EXPLORATION PROGRAM

The exploration potential at the Hercules Property is considered excellent.  The
Comstock  target is untested.  Several of the  near-surface  targets were poorly
tested  and are open  between  the  current  resources.  Obvious  extensions  of
drilling,  soil and rock gold  anomalies  and high grade  veins in old  workings
suggest not only an excellent  chance of increasing  the known  resource of open
pit mineralization but of finding a world class bonanza  gold/silver  deposit at
depth.  During the next six months a drilling  program  will be conducted on the
property.  The proposed budget is $180,000.  Shallow percussion drilling will be
conducted  in the area of  previously  drilled  resources  to explore for feeder
structures. The vast majority of the previous resource drilling was vertical and
did not test for these  potentially  higher grade fault zones. Once these feeder
zones are  identified  a second round of drilling is planned to explore for deep
high grade gold/silver bearing quartz veins similar to the Comstock. This second
program will probably not occur until the following year.

CORTEZ PROPERTIES

On February 28, 2005, the Company entered into an agreement with MinQuest for an
option to acquire a 100%  interest in properties  known as the  "Crescent  Fault
Project,"  the  "Bankop   Property,"   and  the  "Bullion   Mountain   Property"
(collectively,  the  "Cortez  Properties").  Concurrent  with the signing of the
agreement,  the Company made the first property  option payment of $65,000.  The
agreement  requires certain  additional  minimum annual property option payments
totaling  $445,000  and  minimum  annual   exploration   expenditures   totaling
$1,150,000 to be paid or incurred by February 15, 2010. The agreement is subject
to a 3% royalty payable to MinQuest. In addition, the Company is required to use
MinQuest for exploration activities undertaken on the properties.

CRESCENT FAULT PROJECT

DESCRIPTION AND LOCATION OF THE CRESCENT FAULT PROJECT

The Crescent Fault Property is located in Eureka County,  Nevada and consists of
6  unpatented  claims.  Access to the  property is via paved  highway and graded
gravel  road.  The  property  is located  just three  miles from the Mill Canyon
Deposit  drilled by Newmont and five miles from the Cortez Mine.  Land claims in
the district  are  administered  under  Department  of Interior,  Bureau of Land
Management ("BLM") under the Federal Land Policy and Management Act of 1976. All
claims  are  held by  Desert  Pacific  Exploration  (`DPE')  and  under a Letter
Agreement  dated  February 26, 2005  MinQuest  acquired the rights to the claims
comprising  the Crescent Fault  Property from DPE. The Letter  Agreement  allows
MinQuest to assign its interest to third parties.

EXPLORATION HISTORY OF THE CRESCENT FAULT PROJECT

The Crescent Fault Property was explored by Homestake from 1983 to 1986, Noranda
from 1992 to 1994, and North Mining from 1995 to 1996. Past exploration includes
considerable  rock  chip  sampling,  geologic  mapping,  and  drilling.  Clastic
sediments have been  silicified  and argillized  along a range front fault zone.
Mineralization encountered in drilling includes 20 feet grading .11 opt, 25 feet
grading .05 opt and 20 feet grading  .035 opt.  Au.  Drilling has tested part of
the range front and some of the down dropped  section.  Drilling on the property
is summarized as follows:

Homestake                  1985-1986      2 holes drilled for 1,855 feet
Noranda                    1992-1993      8 holes drilled for 4,436 feet
North                      1995           8 holes drilled for 3,930 feet

Drill  intercepts  include 10 feet grading  0.155 opt gold, 20 feet grading 0.11
opt gold,  25 feet grading 0.056 opt gold and numerous  intercepts  from .011 to
..044 opt gold.  Silver  values  range  from 15 to 35 grams per ton over 10 to 40
feet  thicknesses.  Drilling has also  intersected  significant  sphalerite  and
galena over 10 to 20 foot thickness.  The lead-zinc mineralization appears to be
related to  epidote-chlorite  skarn.  The  drilling  has  focused on testing the
surface  expression of pyritic  jasperoid and quartz  veining  developed  within
parallel to  sub-parallel  faults to the range  front.  Potential  down  dropped
sections of mineralization may exist under alluvial cover. Outcrops of jasperoid
are developed along low angle thrust faults and high angle shear zones. Tertiary
age dikes have been noted along high angle faults trending northwesterly.

GEOLOGY OF THE CRESCENT FAULT PROJECT MINERAL CLAIMS

The property was discovered  while  prospecting  along the Crescent  fault.  One
short adit and a few small  prospect  pits were the only  evidence  of  previous
exploration  efforts  prior to the first drill  holes.  The drilling has focused
along the range front, intersecting significant alteration and mineralization.

The regional geology consists of a package of Pennsylvanian to Permian carbonate
to  siliciclastic  sediments.  This  sediment  package  has been  intruded  by a
possible Cretaceous  granodiorite to porphyry rhyolite.  The range front has had
both strike-slip and dip-slip  movement,  down dropped along the Crescent fault.
Placer Dome has  determined  the  strike-slip  movement to be up to 1 mile in an
east-northeasterly  direction.  Many parts of the Crescent  fault have been down
dropped over 1000 feet under  alluvial  cover.  In the vicinity of the property,
drilling and geophysical  data indicate a shelf of bedrock has been preserved at
depths  ranging  from 250 to 400 feet  deep for up to 1000  feet  from the fault
zone.  Potential for a preserved  portion of mineralized  bed rock at reasonable
depth is very good.

The  Crescent  fault  bisects  the  Cortez  Mine  some 8  miles  west.  Tertiary
volcanoclastics  on the  eastern  part of the  property  are  altered and quartz
veined along strike of the fault.  Jasperoid shows  slickensides  indicating two
movements,  one down dropped and one left lateral.  Low angle faulting was noted
near the top of the ridge and has been down faulted  along the range  front,  in
the next section west. The low angle faulting is represented by Ordovician chert
and quartzite thrust over Pennsylvanian  carbonate.  North to northwest trending
faults  bisect  the  range  front  fault  zone,  down  dropping  and  offsetting
mineralization  in several  areas.  Possible  Tertiary  age dikes and sills have
intruded and healed  several  northwesterly  faults and the crescent fault zone.
These dikes are argillized, iron stained and in a few places, quartz veined.

The property  covers a well defined zone of  alteration  exposed along the range
front  fault zone  bounding  the  southeast  portion  of  Crescent  Valley.  The
alteration is composed of jasperoid,  decalcified  limestone,  silicified shale,
and  quartz  veining  filling  faults  and  fractures  in  intrusive  rocks  and
siliciclastic  sediments.  Tertiary age dikes have  intruded the  sediments  and
older intrusive rocks,  generally  following a northwesterly  trend.  Alteration
zones carry low values in gold, silver and copper along with minor elevations of
trace elements  typically  identified in other disseminated gold deposits of the
area.  The  jasperoid is vuggy with weak,  erratic gold and  anomalous  arsenic,
mercury and antimony on the surface.

The Jasperoid target dips northwesterly under alluvium, paralleling the Crescent
Fault.  Drilling has intercepted  relatively shallow bedrock under the alluvium,
but no gold has been encountered to date.  Extensions of the zone will be mapped
and sampled to further define this target area.

Skarn  mineralization is hidden. Skarn is weakly developed and spotty throughout
the area.  Drilling has encountered high grade gold and base metals in carbonate
rocks  similar  to the nearby  Newmont  discovery  at Mill  Creek  about 6 miles
southwest.  Mapping of alteration  phases may better define the Skarn target. At
present,  the best potential  target is a blind skarn zone with  high-grade gold
potential.

CURRENT STATE OF EXPLORATION

The  Crescent  Fault  claims  presently  do not have any mineral  reserves.  The
property that is the subject to our mineral claims is  undeveloped  and does not
contain any open-pit or underground mines. There is no mining plant or equipment
located on the  property  that is the subject of the mineral  claim.  Currently,
there is no power supply to the mineral claim. Our planned  exploration  program
is exploratory in nature and no mineral reserves may ever be found.

Paved roads come within 5 miles of the property and well maintained gravel roads
provide  access  within 1,000 feet of the property  boundary.  A dirt road is in
place and provides  adequate  access  throughout  the  property.  All  currently
proposed drilling can be done without further road building.

GEOLOGICAL EXPLORATION PROGRAM

Potential   exists  for  the  existence  of  relatively   high-grade  gold.  The
exploration completed to date has identified  significant  mineralization within
fault zones  parallel to the range front fault.  Sampling has  indicated  weakly
anomalous  gold  values  exist  over  12,000  feet of strike  length.  A limited
exploration   program  is   recommended   to  test  for   extensions   of  known
mineralization.  Angle drilling is recommended to test for the  continuation  of
gold  mineralization  by  offsetting  known gold  values in  previous  drilling.
Assuming  positive  results in the first phase of  drilling,  a second  phase is
suggested that will test for down-dropped mineralization under alluvial cover as
well as close spaced, definition drilling of the mineralized zone. Additionally,
a geophysical  program  should be  considered  to pinpoint  targets and depth to
bedrock within the boundaries of the claim group.

BANKOP PROPERTY

DESCRIPTION AND LOCATION OF THE BANKOP PROPERTY

The Bankop property is located in eastern Lander County,  Nevada,  approximately
40  kilometers  (25 miles)  southeast of Battle  Mountain and six  kilometers (4
miles)  northwest of the Pipeline Mine.  The property  consists of 24 unpatented
mining claims.  Land claims in the district are administered under Department of
Interior,  Bureau of Land  Management  ("BLM") under the Federal Land Policy and
Management  Act of 1976.  All  claims  are held by  Desert  Pacific  Exploration
(`DPE') and under a Letter  Agreement dated February 26, 2005 MinQuest  acquired
the rights to the claims  comprising  the Bankop  Property  from DPE. The Letter
Agreement allows MinQuest to assign its interest to third parties.

EXPLORATION HISTORY OF THE BANKOP PROPERTY

The Bullion district, which includes the Tenabo and Mud Springs sub-districts to
the north and the Gold Acres sub-district to the southeast, was first prospected
in the  1860's.  Gold was  discovered  at Tenabo in 1905 and mined  until  1912.
Placer  gold  mining was  conducted  at Mud  Springs and Mill Creek in the early
1930's and the first gold was mined at Gold Acres in 1935.  Recorded  production
for the district through 1977 is listed as 300,000 ounces gold, 1 million ounces
silver, 1.3 million pounds copper, and 500,000 tons barite and turquoise.

The Pipeline deposit,  located 6 kilometers (4 miles) southeast of the Utah Camp
property,  was discovered in 1991.  Additional  deposits were  discovered to the
south shortly thereafter. There has been no production from the Bankop claims.

Historic  prospect pits,  adits, and shafts occur throughout the low lying hills
of the area. The property has seen recent exploration efforts beginning as early
as 1965.  Exploration  companies  involved  include  U.S Mining and  Exploration
Company,  Inc.,  Phelps  Dodge,  Inc.,  Placer Amex,  Inc.,  Cyprus  Exploration
Company,  Homestake Mining Company,  U.S Borax,  Placer Dome U.S. Inc.,  Noranda
Exploration, Inc. (Hemlo Gold, Inc.), Uranerz U.S.A., Inc. and Minorca Resources
Inc.  This very large volume of geologic  information  is an extremely  valuable
tool for further study of the property.

GEOLOGY OF THE BANKOP MINERAL CLAIMS

Regionally, the Utah Camp property is situated within the Battle Mountain-Eureka
Trend,  a  northwest  striking  30 to 40 mile  wide (45 to 60 km) belt of mostly
Paleozoic  rocks  which are  intruded  by numerous  Cretaceous  to Tertiary  age
intrusives. Most importantly, this trend defines the second most productive gold
province in the U.S. All bedrock mapped to date on the Bankop  property is Upper
Plate  fine-grained  clastic  rocks.  Although  these  rocks  are  dominated  by
siliceous   lithologies,   they  do  contain   an   appreciable   thickness   of
carbonate-rich  rocks.  Deep  drilling  by Uranerz  contains  thick  sections of
calcareous  siltstone  within  the  Valmy.   Calcareous  sandstones  make  up  a
significant portion of the middle Elder Formation.  Both of these rock types are
good host rocks for Carlin style mineralization.

A significant portion of the property is covered by Quaternary alluvium. Outcrop
is normally sparse,  except where thick sections of quartzite  occur.  Colluvial
cover is  relatively  thick once the break in slope is reached  traversing  from
ridge top to valley.

Besides the bedding plane faults  associated  with thrust  slices,  several high
angle faults have been mapped. The dominant trend is northeast and the next most
abundant trend is northwest.  East-west high angle structures are most common in
the southern portion of the property.

Mineralization occurring within the property is gold associated with arsenic and
mercury.  The main  alteration  type is clay, and therefore,  it is rare for the
mineralization  to outcrop.  Instead it is usually found in topographic lows. At
Uranerz drill site UUT-2, bulldozer work has exposed decalcified sandstone which
assays up to 1.00 g/t gold.  This and several other gold  anomalies in rocks and
soils within the property are indications of Carlin style  mineralization.  Gold
Acres, located three miles (4.5 km) to the southeast, is the closest Carlin-type
mine.

Significant  gold  intercepts  of Carlin  style  mineralization  occur  around a
bulldozer  trench  where  sampling  detected up to 1.4 g/t gold.  Several  holes
drilled in this area had a high of 0.7 g/t over 5 feet (1.5 m). All of the above
holes were drilled vertically.

A number of  companies  have  explored  for  Carlin  style  systems  within  the
property.  Although  these  efforts  provide an  excellent  database for further
studies  they failed to define or test a single  feeder  structure.  Because the
property is underlain by upper plate rocks not known to host large gold deposits
elsewhere in the district,  the emphasis has been on deep drilling to test lower
plate carbonate  rocks.  Without an associated  feeder fault this effort will be
fruitless.

CURRENT STATE OF EXPLORATION

The Bankop claims presently do not have any mineral reserves.  The property that
is the subject to our  mineral  claims is  undeveloped  and does not contain any
open-pit or underground  mines. There is no mining plant or equipment located on
the property that is the subject of the mineral  claim.  Currently,  there is no
power  supply  to  the  mineral  claim.  Our  planned   exploration  program  is
exploratory in nature and no mineral reserves may ever be found.

GEOLOGICAL EXPLORATION PROGRAM

The  recommended  program  at  the  Utah  Camp  for  gold  exploration  involves
identifying  gold bearing  feeder faults using improved  exploration  techniques
such as continuous reading ground magnetics, auger soil sampling and analysis of
soil size fractions to determine the best gold results.  Initial drilling should
be shallow  angle holes  across  potential  feeder  structures  to identify  the
attitude of the structures and the intensity of alteration/mineralization.  Deep
drilling  for  lower  plate  Pipeline  style  targets  is then  recommended  for
identified large, mineralized structures.

BULLION MOUNTAIN PROPERTY

DESCRIPTION AND LOCATION OF THE BULLION MOUNTAIN PROPERTY

The Bullion Mountain  Property is located in Lander County,  Nevada within T29N,
R46E and consists of 38 mining claims. A portion of the claims is made up of the
Bully and Chief  groups of claims.  Access is via gravel  road south from Battle
Mountain.   The  property  is  located   along  the  prolific   Pipeline   trend
approximately 6 miles  northwest of the Pipeline  deposit and 12 miles southeast
of  Battle  Mountain.  Land  claims  in  the  district  are  administered  under
Department of Interior, Bureau of Land Management ("BLM") under the Federal Land
Policy  and  Management  Act of 1976.  All  claims  are held by  Desert  Pacific
Exploration  (`DPE')  and  under a Letter  Agreement  dated  February  26,  2005
MinQuest  acquired  the rights to the claims  comprising  the  Bullion  Mountain
Property from DPE. The Letter  Agreement  allows MinQuest to assign its interest
to third parties.

EXPLORATION HISTORY OF THE BULLION MOUNTAIN PROPERTY

The property  may have been  prospected  as early as the 1870's  during the Utah
Camp and Cortez  silver boom.  Numerous  prospect pits and shallow adits dot the
top of the ridge  that  makes up part of Bullion  Mountain.  The most  extensive
prospecting occurs along low and high angle fault zones with clear quartz veins.
The fault zones generally trend east-northeasterly. These veins can assay over a
half ounce of gold across 1 meter.

The property lies along the Pipeline fault zone which has been defined by Placer
Dome as having a northwesterly trend. Pipeline is about 8 miles southeast of the
property.  The Chief and Bully  claims have been  previously  explored by Placer
Dome, Asarco,  Hemlo, Lac, Barrick, and Pallum. Recent work includes drilling by
Asarco on the Bully  claims and  drilling by Placer Dome and Pallum on the Chief
claims.

Numerous  surface  samples have  identified  high grade gold (>0.5 opt) in fault
zones in upper plate rocks. Drilling by Asarco has encountered 3 meters of 0.204
opt gold on the Bully claims.  Drilling by Pallum encountered 1.5 meters of 0.08
opt gold and 15 meters of 0.02 opt gold on the Chief claims.  Drilling by Placer
Dome and Pallum  has  outlined a small,  low grade  gold  resource  on the Chief
Claims.

GEOLOGY OF THE BULLION MOUNTAIN MINERAL CLAIMS

Upper  plate  Silurian  to  Devonian  siliciclastic  rocks have been thrust over
Cambrian to Silurian  carbonate facies. The entire package of sediments has been
intruded by Tertiary age granite  (Bullion  Mountain  granite).  The Upper Plate
assemblage is hornfelsed and bleached near the margin of the intrusive.

The entire area within the claim block is structurally complex with both low and
high angle faulting.  High angle faults have displaced all rock types.  Dominant
NNW faults can be traced from the Hilltop mine through the  Pipeline  pits.  ENE
faults on the Bully claims contain  significant  gold values.  Many of these ENE
faults and shears have been healed with quartz veins and jasperoid silica.  Gold
is generally found associated with clear,  crystalline  quartz veins and narrow,
argillized  dikes.  Many of the  faults  of the  area  show  secondary  movement
represented by several stages of quartz veining. Recent exploration efforts have
been  limited to low angle fault zones on the Chief claims and within a discreet
area on the Bully claims.

Drilling  has  identified  significant  gold values on the Chief and Bully Claim
groups. The nearby gold deposits of Hilltop and Dean occur within the same upper
plate rocks.  Both the Hilltop and Dean deposits contain  significant high grade
gold in veins with lower grade gold values  hosted by breccia  zones.  The Bully
target area  contains  several  high grade fault zones  within a breccia zone of
lower grade material similar to the Hilltop.  The Chief area has been drilled on
a grid with roughly 200 foot centers.  The drilling  suggests a shallow  dipping
fault breccia zone with consistent gold values.  Both target areas may have high
angle faults  providing  plumbing for the gold  mineralization  in the area.  At
present, a feeder fault has not been identified within the Chief claim boundary.
Exploratory drilling in the valley between Chief and Bully has encountered minor
gold values in upper plate rocks. Further work in this area is also recommended.

CURRENT STATE OF EXPLORATION

The Bullion  Mountain  claims  presently do not have any mineral  reserves.  The
property that is the subject to our mineral claims is  undeveloped  and does not
contain any open-pit or underground mines. There is no mining plant or equipment
located on the  property  that is the subject of the mineral  claim.  Currently,
there is no power supply to the mineral claim. Our planned  exploration  program
is exploratory in nature and no mineral reserves may ever be found.

GEOLOGICAL EXPLORATION PROGRAM

Recommended  exploration  work at the Bully and Chief  portion  on the  property
includes detailed geologic mapping and sampling of the claim blocks. Drilling is
recommended  within the  previously  defined  resource area on the Chief claims.
Previous  sampling on the Bully claims has identified  high grade gold in narrow
veins  throughout  the claim block.  Infrastructure  is well  established in the
Chief area.  Access  roads may have to be built into much of the Bully  area.  A
modest program of infill sampling and detailed  mapping should help define drill
targets  within the Bully claim group.  Permitting  should be relatively  simple
since  roads  are in and the  surrounding  area  is a well  known  mining  field
situated on land administered by the US Bureau of Land Management.

ITEM 3.  LEGAL PROCEEDINGS

We know of no existing or pending legal proceedings against our Company, nor are
we involved as a plaintiff in any proceeding or pending litigation. There are no
proceedings  in which  any of our  directors,  officers  or  affiliates,  or any
registered  or  beneficial  shareholder,  is an adverse  party or has a material
interest adverse to our interest.

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

No matters were  submitted to our security  holders for a vote during the fiscal
year ended January 31, 2004.

On February 12, 2004, a Schedule 14f-1 was filed with the SEC and distributed to
our shareholders regarding the change in control from Mr. Alfredo De Lucrezia to
Donald Neal and Gregory  Crowe,  our current  directors.  On March 10, 2004,  an
Information  Statement was distributed to our shareholders  regarding the action
by the  stockholders  of the  Company  holding  a  majority  of the  issued  and
outstanding shares to change the name of the company from "Baymont  Corporation"
to "American Goldfields Inc."

                                     PART II

ITEM 5. MARKET FOR REGISTRANT'S COMMON EQUITY AND RELATED STOCKHOLDER MATTERS

MARKET INFORMATION

In April 2004 our common  stock began  trading on the Over the Counter  Bulletin
Board sponsored by the National  Association of Securities  Dealers,  Inc. under
the symbol  "AGFL.OB".  The Over the Counter Bulletin Board is maintained by the
NASDAQ Stock Market,  but does not have any of the  quantitative  or qualitative
standards  such as those  required for companies  listed on the NASDAQ Small Cap
Market or National  Market System.  The following  table sets forth the range of
quarterly  high  and low  closing  bids  of the  common  stock  as  reported  on
http://finance.yahoo.com  during the fiscal  years  ending  January 31, 2004 and
January 31, 2005:

        Financial Quarter                   Bid Information*
        -----------------                   ---------------
 Fiscal Year       Quarter            High Bid           Low Bid
 ----------------------------------------------------------------------
 2004        Fourth Quarter       $3.32            $1.70
             Third Quarter        $3.00            $2.07
             Second Quarter       $2.15            $2.10
             First Quarter        N/A              N/A
 2003        Fourth Quarter       N/A              N/A
             Third Quarter        N/A              N/A
             Second Quarter       N/A              N/A
             First Quarter        N/A              N/A
 ----------------------------------------------------------------------

*The quotations reflect inter-dealer prices,  without retail mark-up,  mark-down
or commission and may not represent actual transactions.

HOLDERS OF OUR COMMON STOCK

The Company  estimates that as of April 28, 2005, we had 46 (forty-six)  holders
of record of shares of common stock.

RECENT SALES OF UNREGISTERED SECURITIES

On  November 4, 2004,  the  Company  closed a private  placement  consisting  of
403,600  units at $2.50 per unit for total  proceeds  of  $1,009,000.  Each unit
consists of one common share and three non-transferable share purchase warrants,
designated Class A, Class B and Class C. Each warrant entitles the subscriber to
purchase  one common  share of the  Company  for a period of five years from the
date that the warrant first becomes  exercisable.  The warrants have an exercise
price of $1.50 per share for the Class A warrants, $2.00 per share for the Class
B warrants  and $2.50 per share for the Class C  warrants.  The Class A warrants
are  exercisable   commencing  November  4,  2005,  the  Class  B  warrants  are
exercisable  commencing  May 4, 2006,  and the Class C warrants are  exercisable
commencing  November  4, 2006.  There  were no  underwriters  or  broker-dealers
involved in the issuance of such units and therefore no  underwriting  discounts
or  commissions  were paid.  The shares  were  offered  and issued  pursuant  to
Regulation S promulgated by the Securities Act of 1933.

DIVIDEND POLICY

As of April 28,  2005,  there had been no  dividends  declared on the  Company's
Common Stock.  We have never  declared or paid any cash  dividends on our common
stock nor do we anticipate paying any in the foreseeable future. Furthermore, we
expect to retain any future  earnings to finance our  operations  and expansion.
The payment of cash  dividends  in the future will be at the  discretion  of our
Board  of  Directors  and  will  depend  upon  our  earnings   levels,   capital
requirements,  any  restrictive  loan  covenants  and  other  factors  the Board
considers relevant.

There are no  restrictions  in our  articles  of  incorporation  or bylaws  that
prevent us from declaring  dividends.  The Nevada Revised Statutes,  however, do
prohibit  us  from  declaring  dividends  where,  after  giving  effect  to  the
distribution of the dividend:

     1.  We would not be able to pay our debts as they  become  due in the usual
         course of business; or

     2.  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
         shareholders who have  preferential  rights superior to those receiving
         the distribution.

SECURITIES AUTHORIZED FOR ISSUANCE UNDER EQUITY COMPENSATION PLANS

In March 2004,  the Board of Directors  adopted the American  Goldfields  Inc.'s
2004 Stock Option Plan (the 2004 Plan)  reserving  5,000,000  common  shares for
grant to employees, directors and consultants.

Set forth below is certain  information as of April 28, 2005,  regarding  equity
compensation plans that have not been approved by our shareholders.

EQUITY COMPENSATION PLANS NOT APPROVED BY STOCKHOLDERS AS OF APRIL 28, 2005.
<TABLE>
<CAPTION>

              Plan Category          Number of securities to be   Weighted average exercise    Number of securities
                                      issued upon exercise of        price of outstanding
                                   outstanding options, warrants           options,          remaining available for
                                             and rights              warrants and rights         future issuance
       ----------------------------------------------------------------------------------------------------------------

<S>                                       <C>                            <C>                     <C>
       2004 Stock Option Plan                5,000,000                      $0.06                   3,300,000
</TABLE>

As of April 28, 2005, there were a total of 1,700,000  options granted under the
plan with a $0.06  exercise  price.  Of these,  175,000 remain  outstanding  and
exercisable at an exercise price of $0.06 per option as of April 28, 2005.

The following discussion describes material terms of grants made pursuant to the
stock option plans:

Pursuant  to the  2004  Stock  Option  Plan,  grants  of  shares  can be made to
employees,  officers,  directors,  consultants  and  independent  contractors of
non-qualified  stock  options  as well as for the  grant  of  stock  options  to
employees  that  qualify as incentive  stock  options  under  Section 422 of the
Internal  Revenue Code of 1986 ("Code") or as non-qualified  stock options.  The
Plan is  administered  by the Option  Committee of the Board of  Directors  (the
"Committee"), which has, subject to specified limitations, the full authority to
grant options and establish  the terms and  conditions  for vesting and exercise
thereof. Currently the entire Board functions as the Committee.

In order to exercise an option granted under the Plan, the optionee must pay the
full exercise price of the shares being  purchased.  Payment may be made either:
(i) in cash; or (ii) at the discretion of the Committee, by delivering shares of
common stock  already  owned by the optionee that have a fair market value equal
to the applicable exercise price.

Subject to the  foregoing,  the Committee  has broad  discretion to describe the
terms and conditions applicable to options granted under the Plan. The Committee
may at any  time  discontinue  granting  options  under  the  Plan or  otherwise
suspend,  amend or terminate  the Plan and may, with the consent of an optionee,
make such  modification of the terms and conditions of such optionee's option as
the Committee shall deem advisable.

PURCHASES OF EQUITY SECURITIES BY THE ISSUER AND AFFILIATED PURCHASERS

None.


ITEM 6. MANAGEMENT'S  DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS AND PLAN OF OPERATIONS

The following  discussion  of our financial  condition and results of operations
should be read in  conjunction  with the  financial  statements  and the related
notes  thereto  included  elsewhere in this Form 10-KSB.  The matters  discussed
herein contain  forward-looking  statements within the meaning of Section 21E of
the  Securities  Exchange  Act of  1934,  as  amended,  and  Section  27A of the
Securities Act of 1933, as amended,  which involve risks and uncertainties.  All
statements other than statements of historical  information  provided herein may
be deemed to be forward-looking statements.  Without limiting the foregoing, the
words "believes",  "anticipates", "plans", "expects" and similar expressions are
intended to identify forward-looking statements. Factors that could cause actual
results  to  differ  materially  from  those  reflected  in the  forward-looking
statements  include,  but are not limited to, those  discussed under the heading
"Factors  that May Affect  Future  Results" and elsewhere in this report and the
risks discussed in our other filings with the SEC.  Readers are cautioned not to
place  undue  reliance  on  these  forward-looking  statements,   which  reflect
management's  analysis,  judgment,  belief  or  expectation  only as of the date
hereof.  We undertake no  obligation  to publicly  revise these  forward-looking
statements to reflect events or circumstances that arise after the date hereof.

PLAN OF OPERATIONS

Our business plan is to proceed with the  exploration  of the Gilman,  Imperial,
Hercules and Cortez  Properties  to  determine  whether  there are  commercially
exploitable reserves of gold and silver or other metals. We had $847,199 in cash
and $815,588 in working capital as of January 31, 2005.

During our exploration stage, our president will only be devoting  approximately
five hours per week of his time to our  business.  We do not foresee the limited
involvement  of our President as negatively  impacting our company over the next
twelve months as all exploratory work is being performed by outside consultants.
Additionally, we will not have a need to hire any employees over the next twelve
months;  nor do we plan to make any purchases of equipment  over the next twelve
months due to reliance upon outside  consultants to provide all tools needed for
the exploratory work being conducted.

RESULTS OF OPERATIONS FOR THE FISCAL YEAR ENDED JANUARY 31, 2005

We did not earn any revenues  during the fiscal year ended  January 31, 2005. We
do not  anticipate  earning  revenues  until such time as we have  entered  into
commercial  production  of  our  mineral  properties.  We are  presently  in the
exploration  stage of our business and we can provide no assurance  that we will
discover commercially exploitable levels of mineral resources on our properties,
or if  such  resources  are  discovered,  that  we will  enter  into  commercial
production of our mineral properties.

For the year ended  January 31,  2005 we had a net loss of $325,261  compared to
$28,366 for the prior  year,  an  increase  of  $296,895.  Our loss for 2005 has
increased  substantially  over 2004 as a result  of the  Company  making  option
payments  totaling  $90,000  with respect to the  Hercules  ($20,000),  Imperial
($60,000) and Gilman  ($10,000)  property  option  agreements.  In addition,  an
exploration drill program began on the Imperial Property in the third quarter of
the  current  year  resulting  in  approximately  $114,000  in mineral  property
expenses.  In the prior year,  property  expenditures of $7,600 were incurred on
the Company's former joint venture, the Bor claims. Also in the current year the
Company  recorded  $43,200 in  stock-based  compensation  in relation to options
granted to  non-employees  for  services  provided  to the Company and $5,500 in
amortization  relating to  web-site  development  costs.  Neither of these items
occurred in the year ended January 31, 2004.  Costs to  restructure  the Company
including  the  relocation  and  setting-up  of the  Company's  new office  were
incurred in the current period but not in the prior period.

LIQUIDITY AND CAPITAL RESOURCES

We had cash of $847,199 and working  capital of $815,588 as of January 31, 2005.
We anticipate that we will incur over the next twelve months:

     o   $120,000 in  connection  with property  payments on the Company's  four
         option agreements.  Of this amount,  $65,000 was paid by the Company on
         February  28,  2005  upon  execution  of  the  Cortez  Property  Option
         Agreement;

     o   $375,000  in  property  exploration  expenses  in  order  to  meet  the
         requirements of the Company's property option agreements;

     o   $50,000 for operating expenses,  including working capital and general,
         legal, accounting and administrative expenses associated with reporting
         requirements under the Securities Exchange Act of 1934.

Net cash used in operating activities during the year ended January 31, 2005 was
$250,649  compared  to $18,764  during  the year ended  January  31,  2004.  The
increased  cash used in  operations  was primarily due to an increase in the net
loss in 2005  ($325,261)  compared to 2004  ($28,366).  The effect of the higher
loss was  partially  offset  by two  non-cash  items  included  in the loss from
operations in the current year.  The Company  recorded  $43,200 in  non-employee
stock-based  compensation and $5,500 related to the amortization of its web-site
development costs. Also partially offsetting the effect of the increased loss in
the current year was an increase in accounts payable and accrued  liabilities of
$26,012.

Cash from  financing  for the year  ended  January  31,  2005 was the  result of
$1,009,000  received from a private placement.  The Company issued 403,600 units
at $2.50 per unit. The Company also received  $90,000 from the exercise of stock
options.  During the year,  the Company  obtained a $60,000 bridge loan that was
repaid within the current fiscal year. Cash used in investing activities related
to the payment of a refundable reclamation deposit to the state of Nevada on the
Imperial Property. There was no financing or investing activity in 2004.

Current  cash  on hand  is  sufficient  for  the  Company's  requirements  until
approximately  the second  quarter of fiscal 2007. We shall  require  additional
funding in the future and we anticipate that such funding will be in the form of
equity financing from the sale of our common stock.  However,  we cannot provide
investors  with any assurance that we will be able to raise  sufficient  funding
from the sale of our common stock to fund  additional  phases of the exploration
program, should we decide to proceed. We believe that debt financing will not be
an alternative  for funding any further phases in our exploration  program.  The
risky  nature  of this  enterprise  and  lack of  tangible  assets  places  debt
financing  beyond  the  credit-worthiness  required  by most  banks  or  typical
investors of corporate debt until such time as an  economically  viable mine can
be demonstrated.  We do not have any arrangements in place for any future equity
financing.

OFF BALANCE SHEET ARRANGEMENTS

We do not have any off balance sheet  arrangements that are reasonably likely to
have a current or future effect on our financial condition, revenues, results of
operations, liquidity or capital expenditures.


<PAGE>



ITEM 7.  FINANCIAL STATEMENTS

Index to Consolidated Financial Statements:

1. Auditors' Report;

2. Audited  Consolidated  Financial  Statements  for the year ended  January 31,
2005, including:

         a.       Consolidated Balance Sheets as at January 31, 2005 and 2004;

         b.       Consolidated  Statements  of  Operations  for the years  ended
                  January 31, 2005 and 2004 and for the period from inception on
                  December 21, 2001 to January 31, 2005;

         c.       Consolidated  Statements  of Cash  Flows for the  years  ended
                  January 31, 2005 and 2004 and for the period from inception on
                  December 21, 2001 to January 31, 2005;

         d.       Statements of Stockholders' Equity for the years ended January
                  31,  2005  and  2004  and for the  period  from  inception  on
                  December 21, 2001 to January 31, 2005;

         e.       Notes to the Consolidated Financial Statements.




<PAGE>




                            AMERICAN GOLDFIELDS INC.
                         (FORMERLY BAYMONT CORPORATION)
                         (AN EXPLORATION STAGE COMPANY)


                        CONSOLIDATED FINANCIAL STATEMENTS


                                JANUARY 31, 2005
                            (STATED IN U.S. DOLLARS)



<PAGE>



             REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM




To the Board of Directors and Stockholders of
American Goldfields Inc.
(Formerly Baymont Corporation)
(An exploration stage company)

We  have  audited  the  accompanying  consolidated  balance  sheet  of  American
Goldfields Inc. (formerly Baymont Corporation) (an exploration stage company) as
at  January  31,  2005 and  2004  and the  related  consolidated  statements  of
operations,  cash flows,  and  stockholders'  equity for each of the two periods
ended January 31, 2005. 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  an audit to obtain  reasonable  assurance  whether  the  financial
statements are free of material misstatement.  An audit includes examining, on a
test basis,  evidence  supporting  the amounts and  disclosures in the financial
statements.  An audit also includes assessing the accounting principles used and
significant  estimates  made by  management,  as well as evaluating  the overall
financial  statement  presentation.   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 at January 31,
2005 and the  results  of its  operations  and its  cash  flows  for the  period
indicated 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 incurred a net loss of $418,970 since inception, has not
attained  profitable   operations  and  is  dependent  upon  obtaining  adequate
financing to fulfill its exploration activities. These factors raise substantial
doubt that the Company will be able 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.


Vancouver, Canada                                        /s/ "Morgan & Company"

April 15, 2005                                           Chartered Accountants




<PAGE>



                            AMERICAN GOLDFIELDS INC.
                         (FORMERLY BAYMONT CORPORATION)
                         (AN EXPLORATION STAGE COMPANY)

                           CONSOLIDATED BALANCE SHEETS
                            (STATED IN U.S. DOLLARS)
<TABLE>
<CAPTION>
--------------------------------------------------------------------------------- ----------------------------------
                                                                                            JANUARY 31
                                                                                         2005              2004
--------------------------------------------------------------------------------- - --------------- -- -------------
<S>                                                                               <C>               <C>
ASSETS

CURRENT ASSETS
      Cash and cash equivalents                                                   $      847,199    $      12,104
      Prepaid expenses                                                                       430              330
                                                                                  - --------------- -- -------------
                                                                                         847,629           12,434

RECLAMATION DEPOSIT (note 4)                                                              13,256               -
WEB-SITE DEVELOPMENT COSTS, net (note 5)                                                  12,500               -
                                                                                  - --------------- -- -------------

                                                                                  $      873,385    $      12,434
================================================================================= = =============== == =============

LIABILITIES

CURRENT LIABILITIES
     Accounts payable and accrued liabilities                                     $       32,041    $      10,572
                                                                                  - --------------- -- -------------

STOCKHOLDERS' EQUITY

SHARE CAPITAL (NOTE 7)
     Authorized:
         600,000,000 (January 31, 2004 - 100,000,000) common shares with a par
           value of $0.001 per share
         100,000,000 preferred shares with a par value of $0.001 per share
     Issued:
            25,817,878 (January 31, 2004 - 53,914,278) common shares issued and
               outstanding at January 31, 2005                                            25,818           53,914

     Additional paid-in capital                                                          532,232           41,657
     Additional paid-in capital - warrants                                               702,264                -

DEFICIT ACCUMULATED DURING THE EXPLORATION STAGE                                        (418,970)         (93,709)
                                                                                  - --------------- -- -------------
TOTAL STOCKHOLDERS' EQUITY                                                               841,344            1,862
                                                                                  - --------------- -- -------------

                                                                                  $      873,385    $      12,434
================================================================================= = =============== == =============
</TABLE>

Commitments (Note 8)

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


<PAGE>


                            AMERICAN GOLDFIELDS INC.
                         (FORMERLY BAYMONT CORPORATION)
                         (AN EXPLORATION STAGE COMPANY)

                      CONSOLIDATED STATEMENTS OF OPERATIONS
                            (STATED IN U.S. DOLLARS)


<TABLE>
<CAPTION>
------------------------------------------------------ ----------------------- ----------------- -------------------
                                                                                                    DECEMBER 21,
                                                                                                        2001
                                                                YEAR ENDED JANUARY 31,             (INCEPTION) TO
                                                       -----------------------------------------
                                                                                                     JANUARY 31
                                                               2005                 2004                2005
------------------------------------------------------ --------------------- ------------------- -------------------
<S>                                                    <C>                   <C>                 <C>
REVENUE                                                $               -     $               -   $              -
                                                       -- ------------------ -- ---------------- -- ----------------

EXPENSES
     Mineral claim payments and exploration
       expenditures                                              246,529                  7,600          261,053
     Office and sundry                                            35,941                  2,117           39,116
     Rent                                                          4,922                  1,155            6,862
     Professional fees                                            24,272                 11,589           89,077
     Transfer agent fees                                           3,300                    905            5,565
     Amortization                                                  5,500                      -            5,500
     Interest expense                                              1,070                      -            1,070
     Directors' fees                                                   -                  5,000            5,000
     Consulting fees                                               3,727                      -            5,727
                                                       -- ------------------ -- ---------------- -- ----------------

                                                                 325,261                28,366           418,970
                                                       -- ------------------ -- ---------------- -- ----------------


NET LOSS FOR THE PERIOD                                $        (325,261)    $         (28,366)  $      (418,970)
====================================================== == ================== == ================ == ================


BASIC AND DILUTED LOSS PER SHARE OF COMMON STOCK
                                                       $         (0.01)      $          0.00
====================================================== == ================== == ================


WEIGHTED AVERAGE NUMBER OF SHARES OUTSTANDING -
  BASIC AND DILUTED                                           29,808,982            53,914,278
====================================================== == ================== == ================
</TABLE>








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


<PAGE>


                            AMERICAN GOLDFIELDS INC.
                         (FORMERLY BAYMONT CORPORATION)
                         (AN EXPLORATION STAGE COMPANY)

                      CONSOLIDATED STATEMENTS OF CASH FLOWS
                            (STATED IN U.S. DOLLARS)
<TABLE>
<CAPTION>
-------------------------------------------------------------- --------------- ------------------- -------------------
                                                                                                      DECEMBER 21,
                                                                                                          2001
                                                                     YEAR ENDED JANUARY 31,          (INCEPTION) TO
                                                               -----------------------------------
                                                                                                       JANUARY 31
                                                                     2005              2004               2005
-------------------------------------------------------------- ------------------ ---------------- -------------------
<S>                                                            <C>                <C>              <C>
CASH PROVIDED BY (USED IN):

CASH FLOWS USED IN OPERATING ACTIVITIES
     Net loss for the period                                   $      (325,261)   $     (28,366)   $        (418,970)

    ADJUSTMENTS TO RECONCILE NET LOSS TO NET
    CASH FLOWS USED IN OPERATING ACTIVITIES:
      Stock-based compensation                                          43,200                -               43,200
      Amortization                                                       5,500                -                5,500
    Changes in assets and liabilities
      Prepaid expenses                                                    (100)            (330)                (430)
      Accounts payable and accrued liabilities                          26,012            9,932               36,584
                                                               -- --------------- -- ------------- -- ----------------
                                                                      (250,649)         (18,764)            (334,116)
                                                               -- --------------- -- ------------- -- ----------------

CASH FLOWS FROM (USED IN) FINANCING ACTIVITY
     Proceeds from loan                                                 60,000                -               60,000
     Repayment of loan principal                                       (60,000)               -              (60,000)
     Proceeds from the exercise of stock options                        90,000                -               90,000
     Proceeds from the issue of common stock                         1,009,000                -            1,104,571
                                                               -- --------------- -- ------------- -- ----------------
                                                                     1,099,000                -            1,194,571
                                                               -- --------------- -- ------------- -- ----------------

CASH FLOWS USED IN INVESTING ACTIVITY
      Reclamation deposit                                              (13,256)               -              (13,256)
                                                               -- --------------- -- ------------- -- ----------------
                                                                       (13,256)               -              (13,256)
                                                               -- --------------- -- ------------- -- ----------------

INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS DURING THE
    YEAR                                                               835,095          (18,764)             847,199

CASH AND CASH EQUIVALENTS, BEGINNING OF YEAR
                                                                        12,104           30,868                    -
                                                               -- --------------- -- ------------- -- ----------------

CASH AND CASH EQUIVALENTS, END OF YEAR                         $       847,199    $      12,104    $         847,199
============================================================== == =============== == ============= == ================

SCHEDULE OF NON-CASH ACTIVITIES
       Settlement of accounts payable by contribution
         from a stockholder                                   $        4,543      $       -        $        4,543
       Web-site development costs related to
         non-employee stock-based compensation                $      18,000      $         -       $      18,000
</TABLE>



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


<PAGE>


                            AMERICAN GOLDFIELDS INC.
                         (FORMERLY BAYMONT CORPORATION)
                         (AN EXPLORATION STAGE COMPANY)


                 CONSOLIDATED STATEMENT OF STOCKHOLDERS' EQUITY

                                JANUARY 31, 2005
                            (STATED IN U.S. DOLLARS)


<TABLE>
<CAPTION>
                                                 COMMON STOCK                                   DEFICIT
                                   -----------------------------------------
                                                                               ADDITONAL      ACCUMULATED
                                     NUMBER OF                 ADDITIONAL       PAID IN        DURING THE           TOTAL
                                       COMMON         PAR        PAID IN        CAPITAL       EXPLORATION       STOCKHOLDERS'
                                       SHARES        VALUE       CAPITAL       WARRANTS          STAGE              EQUITY
                                   --------------- ---------- -------------- -------------- ----------------- -------------------
<S>                                <C>            <C>         <C>            <C>            <C>               <C>
Shares issued for cash on
    Incorporation at $0.001 per     36,000,000     $    36,000 $  (30,000)    $         -    $           -     $          6,000
share
Shares issued for cash at $0.03
    per share                       17,914,278       17,914         71,657              -                -               89,571
Net loss for the period                      -               -           -              -          (10,745)             (10,745)
                                   --------------- ---------- -------------- -------------- ----------------- -------------------

Balance, January 31, 2002           53,914,278      $ 53,914   $    41,657    $         -    $     (10,745)    $         84,826

Net loss for the year                        -               -           -              -          (54,598)            (54,598)
                                   --------------- ---------- -------------- -------------- ----------------- -------------------

Balance, January 31, 2003             53,914,278    $ 53,914     $ 41,657     $         -    $     (65,343)    $        30,228

Net loss for the period                   -             -            -                  -          (28,366)            (28,366)
                                   --------------- ---------- -------------- -------------- ----------------- -------------------

Balance, January 31, 2004             53,914,278    $ 53,914     $ 41,657          $ -          $ (93,709)          $ 1,862

Contributions by shareholders             -             -          4,543            -               -                4,543

Cancellation of common shares       (30,000,000)    (30,000)      30,000            -               -                  -

Stock-based compensation                  -             -         61,200            -               -                61,200

Exercise of common stock options      1,500,000       1,500       88,500            -               -                90,000

Private placement, common share
  issuances for cash at $2.50
  per unit in November, 2004            403,600        404        306,332        702,264            -              1,009,000
  (Note 7)

Net loss for the year                     -             -            -              -           (325,261)          (325,261)
                                   --------------- ---------- -------------- -------------- ----------------- -------------------

Balance, January 31, 2005             25,817,878    $ 25,818     $ 532,232      $ 702,264      $ (418,970)         $ 841,344

                                   =============== ========== ============== ============== ================= ===================
</TABLE>











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


<PAGE>


                            AMERICAN GOLDFIELDS INC.
                         (FORMERLY BAYMONT CORPORATION)
                         (AN EXPLORATION STAGE COMPANY)

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

                            JANUARY 31, 2005 AND 2004
                            (STATED IN U.S. DOLLARS)


1.   NATURE OF OPERATIONS

     Organization

     The Company was  incorporated in the State of Nevada,  U.S.A.,  on December
     21, 2001. On February 24, 2004, the Company and a majority of the Company's
     stockholders  authorized  the  changing of the  Company's  name to American
     Goldfields Inc. The name change became effective March 31, 2004.

     On February 23, 2004,  the Board of  Directors  authorized a 6-for-1  stock
     split of the Company's  $0.001 par value common  stock.  As a result of the
     split  44,928,565  additional  shares were issued,  and additional  paid-in
     capital  was  reduced  by  $44,928.  All  references  in  the  accompanying
     financial  statements to the number of common shares and per-share  amounts
     for 2004 have been restated to reflect the stock split.

     Exploration Stage Activities

     The Company has been in the  exploration  stage since its formation and has
     not yet realized any revenues from its planned operations.  It is primarily
     engaged in the  acquisition  and  exploration  of mining  properties.  Upon
     location of a commercial,  minable reserve, the Company expects to actively
     prepare the site for its extraction and enter a development stage.

     Going Concern

     The  accompanying  financial  statements  have been  prepared  assuming the
     Company will continue as a going  concern.  This  contemplates  that assets
     will be realized and liabilities  and  commitments  satisfied in the normal
     course of business.

     As shown in the accompanying  consolidated financial statements the Company
     has incurred a net loss of $418,970  for the period from  December 21, 2001
     (inception) to January 31, 2005 and has no source of revenue. The future of
     the  Company is  dependent  upon its ability to obtain  financing  and upon
     future  acquisition,  exploration and development of profitable  operations
     from its  mineral  properties.  Management  has  plans  to seek  additional
     capital  through a private  placement  and  public  offering  of its common
     stock. These conditions raise substantial doubt about the Company's ability
     to continue  as a going  concern.  Although  there are no  assurances  that
     management's plans will be realized,  management  believes that the Company
     will be able to continue operations in the future. The financial statements
     do  not  include  any  adjustments   relating  to  the  recoverability  and
     classification of recorded assets, or the amounts of and  classification of
     liabilities  that  might be  necessary  in the  event  the  Company  cannot
     continue in existence.


<PAGE>


                            AMERICAN GOLDFIELDS INC.
                         (FORMERLY BAYMONT CORPORATION)
                         (AN EXPLORATION STAGE COMPANY)

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

                            JANUARY 31, 2005 AND 2004
                            (STATED IN U.S. DOLLARS)



2.   SIGNIFICANT ACCOUNTING POLICIES

     The consolidated  financial statements have, in management's  opinion, been
     properly  prepared within  reasonable  limits of materiality and within the
     framework of the significant accounting policies summarized below:

     Basis of Presentation

     These consolidated financial statements include the accounts of the Company
     and its wholly-owned Canadian subsidiary, Baymont Explorations Inc.

     The consolidated  financial statements of the Company have been prepared in
     accordance  with  generally  accepted  accounting  principles in the United
     States.

     Capital Assets

     Web-site  development is recorded at cost.  Web-site  development costs are
     amortized  on a  straight-line  basis over their  estimated  useful life of
     three years.

     Mineral Claim Payments and Exploration Expenditures

     The Company expenses all costs related to the acquisition,  maintenance and
     exploration costs relating to unproven mineral properties,  to which it has
     secured   exploration   rights.  When  proven  and  probable  reserves  are
     determined for a property and a feasibility  study prepared with respect to
     the property,  then subsequent  exploration  and  development  costs of the
     property will be capitalized.  To date, the Company has not established the
     commercial feasibility of its exploration prospects.  Therefore,  all costs
     have been expensed.

     Use of Estimates

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


<PAGE>


                            AMERICAN GOLDFIELDS INC.
                         (FORMERLY BAYMONT CORPORATION)
                         (AN EXPLORATION STAGE COMPANY)

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

                            JANUARY 31, 2005 AND 2004
                            (STATED IN U.S. DOLLARS)



2. SIGNIFICANT ACCOUNTING POLICIES (Continued)

     Environmental Costs

     Environmental expenditures that relate to current operations are charged to
     operations or capitalized as  appropriate.  Expenditures  that relate to an
     existing  condition caused by past operations,  and which do not contribute
     to  current  or future  revenue  generation,  are  charged  to  operations.
     Liabilities  are recorded when  environmental  assessments  and/or remedial
     efforts are probable, and the cost can be reasonably estimated.  Generally,
     the timing of these accruals  coincides with the earlier of completion of a
     feasibility  study or the Company's  commitments to plan of action based on
     the then known facts.

     Cash and Cash Equivalents

     The Company considers all liquid investments,  with an original maturity of
     three months or less when purchased, to be cash equivalents.

     Foreign Currency Translation

     The Company's  functional currency is the U.S. dollar.  Transactions in
     foreign currency are translated into U.S. dollars as follows:

     i) monetary  items at the rate  prevailing at the balance  sheet date;  ii)
     non-monetary items at the historical exchange rate;
     iii)revenue and expense at the average rate in effect during the applicable
     accounting period.

     Exchange  gains or losses  arising on  translation  are  included in income
(loss) for the year.

     Income Taxes

     The Company has adopted Statement of Financial Accounting Standards No. 109
     - "Accounting for Income taxes" (SFAS 109). This standard  requires the use
     of an asset and liability approach for financial accounting,  and reporting
     on income taxes.  If it is more likely than not that some portion or all of
     a  deferred  tax asset  will not be  realized,  a  valuation  allowance  is
     recognized.


<PAGE>


                            AMERICAN GOLDFIELDS INC.
                         (FORMERLY BAYMONT CORPORATION)
                         (AN EXPLORATION STAGE COMPANY)

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

                            JANUARY 31, 2005 AND 2004
                            (STATED IN U.S. DOLLARS)

2. SIGNIFICANT ACCOUNTING POLICIES (Continued)

     Loss Per Share

     Basic earnings (loss) per share of common stock is computed by dividing net
     income  (loss)  available to common  shareholders  by the  weighted-average
     number of common shares  outstanding for the period.  Diluted  earnings per
     share of common stock  reflect the  potential  dilution that could occur if
     securities  or other  contracts  to issue  common  stock were  exercised or
     converted  into common  stock or resulted in the  issuance of common  stock
     that then shared in the earnings of the Company.

     At January 31, 2005, potential common shares of 1,410,800 (January 31, 2004
     - Nil) related to common stock  options and warrants were excluded from the
     computation   of  diluted   earnings   per  share  since  their  effect  is
     anti-dilutive.

     Financial Instruments

     The  Company's  financial  assets  and  liabilities  consist  of cash,  and
     accounts payable and accrued liabilities.  Except as otherwise noted, it is
     management's  opinion  that  the  Company  is not  exposed  to  significant
     interest or credit risks arising from these financial instruments. The fair
     values of these financial instruments approximate their carrying values due
     to the short-term maturities of these instruments.

     New Accounting Pronouncements

     On December 16, 2004,  the Financial  Accounting  Standards  Board ("FASB")
     issued  Statement  of  Financial  Accounting  Standards  ("SFAS")  No.  123
     (revised  2004),  "Share-Based  Payment." SFAS No. 123(R) would require our
     company to measure all  employee  stock-based  compensation  awards using a
     fair value  method and record such  expense in its  consolidated  financial
     statements. In addition, SFAS No. 123(R) will require additional accounting
     related to the income tax effects and additional  disclosure  regarding the
     cash flow effects  resulting from  share-based  payment  arrangements.  For
     public  entities that file as a small business  issuer,  SFAS No. 123(R) is
     effective for the first interim or annual  reporting period beginning after
     December 31, 2005.

     The  implementation of this new standard is not expected to have a material
     effect on the Company's financial statements.

     In  December  2004,  FASB  issued  SFAS  No.  153 to  amend  Opinion  29 by
     eliminating the exception for non-monetary  exchanges of similar productive
     assets and replaces it with general exception for exchanges of non-monetary
     assets that do not have commercial  substance.  A non-monetary  exchange is
     defined to have commercial substance if the future cash flows of the entity
     are expected to change significantly as a result of the exchange.


<PAGE>


                            AMERICAN GOLDFIELDS INC.
                         (FORMERLY BAYMONT CORPORATION)
                         (AN EXPLORATION STAGE COMPANY)

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

                            JANUARY 31, 2005 AND 2004
                            (STATED IN U.S. DOLLARS)


2. SIGNIFICANT ACCOUNTING POLICIES (Continued)

     The  implementation of this new standard is not expected to have a material
     effect on the Company's financial statements.


3.   MINERAL PROPERTY INTERESTS

     BOR Claims

     By an agreement dated December 28, 2001, as amended, the Company acquired a
     75%  interest in the BOR Claims  located in British  Columbia,  Canada,  in
     consideration  of a cash  payment  of $2,500.  Based on the  results of the
     exploration  programs undertaken by the Company, the Company terminated the
     BOR Agreement on April 20, 2004.

     Gilman Property

     On May 7, 2004,  the Company  completed the formal  agreement with MinQuest
     Inc.  (`MinQuest')  for an option to acquire a 100%  interest in the Gilman
     Property. Concurrently, the company made the first scheduled option payment
     of  $10,000.  The Gilman  property  consists of 19  contiguous,  unpatented
     mineral claims covering  approximately  390 acres located in Lander County,
     Nevada,  U.S.A. The agreement  requires certain  additional  minimum annual
     option payments  totaling $75,000 to be paid by May 15, 2009. The agreement
     also requires minimum annual exploration expenditures with a grand total of
     $450,000 in expenditures required to be incurred on the property by May 15,
     2009. The agreement is subject to a 3% royalty payable to MinQuest with the
     Company  being able to  repurchase  up to  two-thirds  of the  royalty  for
     $1,000,000 for each 1% repurchased.

     Imperial Property

     On June 30, 2004,  the Company  entered into an agreement with MinQuest for
     an option to acquire a 100% interest in the Imperial Property.  The company
     made the first  scheduled  option  payment  of  $60,000  upon  signing  the
     agreement  (see  also  note  6).  The  Imperial  Property  consists  of  22
     contiguous,  unpatented  mineral claims  covering  approximately  450 acres
     located in Esmeralda County,  Nevada, U.S.A. The agreement requires certain
     additional  minimum annual option payments  totaling  $80,000 to be paid by
     July 1, 2008.  The  agreement  also  requires  minimum  annual  exploration
     expenditures with a grand total of $500,000 in expenditures  required to be
     incurred on the property by the July 1, 2009. The property option agreement
     is subject to a 3% royalty payable to MinQuest.  The Company is required to
     use MinQuest for exploration conducted on the Imperial Property.


<PAGE>


                            AMERICAN GOLDFIELDS INC.
                         (FORMERLY BAYMONT CORPORATION)
                         (AN EXPLORATION STAGE COMPANY)

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

                            JANUARY 31, 2005 AND 2004
                            (STATED IN U.S. DOLLARS)



3. MINERAL PROPERTY INTERESTS (Continued)

     Hercules Property

     On October 22, 2004,  the Company  entered into an agreement  with MinQuest
     for an  option  to  acquire  a 100%  interest  in  the  Hercules  Property.
     Concurrent  with the signing of the  agreement,  the Company made the first
     option  payment of $20,000.  The Hercules  Property  consists of 40 mineral
     claims located in Lyon County,  Nevada, USA. The agreement requires certain
     additional  minimum annual option  payments  totaling  $200,000 and minimum
     annual exploration  expenditures totaling $4,050,000 to be paid or incurred
     by November 25, 2014.  The agreement is subject to a 3% royalty  payable to
     MinQuest  with the Company being able to repurchase up to two-thirds of the
     royalty for $3,000,000.


4.   RECLAMATION DEPOSIT

     The Company has been granted a drilling permit from the state of Nevada for
     the Imperial Property. As part of the application process, the Company paid
     a  refundable  deposit  to the state for the  estimated  reclamation  costs
     associated with the planned drill program.  Upon completion of any required
     reclamation, the Company will receive a refund of the deposit.


5.   WEB-SITE DEVELOPMENT COSTS

     Web-site development costs,  totaling $18,000,  represent capitalized costs
     of design, configuration, coding, installation and testing of the Company's
     web-site up to initial installation.  Ongoing web-site  post-implementation
     costs will be charged to operations as incurred.


6.   LOAN PAYABLE

     On July 5, 2004 the Company  entered into a loan  agreement with a minority
     shareholder.  The total  proceeds  of the loan of $60,000  were used by the
     Company  to make  the  initial  option  payment  on the  Imperial  Property
     Agreement  (note 3). No security was provided for the loan. On November 15,
     2004,  the  Company  repaid the  balance of the loan of $60,000  along with
     $1,070 of interest at the agreed rate of Bank of Canada Prime  Lending Rate
     plus 1%.


<PAGE>


                            AMERICAN GOLDFIELDS INC.
                         (FORMERLY BAYMONT CORPORATION)
                         (AN EXPLORATION STAGE COMPANY)

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

                            JANUARY 31, 2005 AND 2004
                            (STATED IN U.S. DOLLARS)



7.   SHARE CAPITAL

     a)  Issued Shares

         i)   On February 23,  2004,  the Company  approved a 6:1 forward  stock
              split.  As a result of the stock split,  an additional  44,928,565
              shares of common  stock were  issued.  The par value of the common
              stock  remained  unchanged  at  $0.001  per  common  share but the
              authorized  number of common stock  increased to 600,000,000  from
              100,000,000.

         ii)  On March 31, 2004,  two Directors of the company  returned a total
              of 30,000,000 shares (such number reflects the 6:1 stock split) of
              common stock to treasury for no proceeds.

         iii) On  November  4,  2004,  the  Company  closed a private  placement
              consisting of 403,600  units at $2.50 per unit for total  proceeds
              of  $1,009,000.  Each unit  consists of one common share and three
              non-transferable  share  purchase  warrants,  designated  Class A,
              Class B and Class C.  Each  warrant  entitles  the  subscriber  to
              purchase  one  common  share of the  Company  for a period of five
              years from the date that the warrant  first  becomes  exercisable.
              The  warrants  have an  exercise  price of $1.50 per share for the
              Class A  warrants,  $2.00 per share for the Class B  warrants  and
              $2.50 per share for the Class C warrants. The Class A warrants are
              exercisable  commencing November 4, 2005, the Class B warrants are
              exercisable  commencing  May 4, 2006, and the Class C warrants are
              exercisable commencing November 4, 2006.

     b)  Stock Options

         The Company applies  Accounting  Principles  Board Opinion No. 25 ("APB
         No. 25") and related  interpretations  in  accounting  for its employee
         common  stock  option  plans.   Accordingly,   compensation  costs  are
         recognized as the difference  between the exercise price of each option
         and the market price of the Company's  stock at the date of each grant.
         The Company has not granted any stock options to employees or directors
         in either of the years ended January 31, 2005 or 2004.


<PAGE>


                            AMERICAN GOLDFIELDS INC.
                         (FORMERLY BAYMONT CORPORATION)
                         (AN EXPLORATION STAGE COMPANY)

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

                            JANUARY 31, 2005 AND 2004
                            (STATED IN U.S. DOLLARS)



7. SHARE CAPITAL (Continued)

     b) Stock Options (Continued)

         The Company  accounts for the grant of options to  non-employees  using
         the fair  value-based  method  prescribed  in  Statement  of  Financial
         Accounting  Standard  ("SFAS") No. 123 (as amended by SFAS 143),  using
         the  Black-Scholes  option  pricing  model.  Compensation  for unvested
         options is  amortized  over the vesting  period.  The  Company  granted
         1,700,000 stock options to non-employees  during the year ended January
         31, 2005  (January  31, 2004 - Nil).  The options were valued using the
         Black-Scholes option pricing model with the following assumptions:  (1)
         dividend  yield of 0%, (2) expected  volatility of 165%,  (3) risk free
         interest  rate of 3% and,  (4)  expected  life of 1 year.  The weighted
         average  fair value of options  granted for the year ended  January 31,
         2005  was  $0.036.  As a  result  of  the  recognition  of  stock-based
         compensation,   the  following   amounts  have  been  included  in  the
         Consolidated Statement of Loss at January 31, 2005:

         Mineral property acquisition and exploration expenditures     $ 32,400
         Office and sundry                                                7,200
         Consulting                                                       3,600
                                                                     ----------
                                                                       $ 43,200

         In addition,  web site development  costs in the amount of $18,000 have
         been  capitalized  pursuant  to  the  granting  of  non-employee  stock
         options.

         In March 2004, the Board of Directors  adopted the American  Goldfields
         Inc.'s  2004  Stock  Option  Plan (the 2004 Plan)  reserving  5,000,000
         common  shares  for  grant to  employees,  directors  and  consultants.
         Because  additional  stock options are expected to be granted in future
         periods,   the   above   stock-based   compensation   expense   is  not
         representative of the effects on reported  financial results for future
         periods.

         Activity under the 2004 Plan is summarized as follows:

                                    OPTIONS OUTSTANDING    WEIGHTED AVERAGE
                                                            EXERCISE PRICE
                                    -------------------- ---------------------
Balance, January 31, 2003 and 2004                -             -
Options granted                           1,700,000      $   0.06
Options exercised                        (1,500,000)     $   0.06
                                    -------------------- ---------------------
Balance, January 31, 2005                   200,000      $   0.06
                                    -------------------- ---------------------



<PAGE>


                            AMERICAN GOLDFIELDS INC.
                         (FORMERLY BAYMONT CORPORATION)
                         (AN EXPLORATION STAGE COMPANY)

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

                            JANUARY 31, 2005 AND 2004
                            (STATED IN U.S. DOLLARS)



7. SHARE CAPITAL (Continued)

     b) Stock Options (Continued)

         The following table summarizes  information  concerning outstanding and
         exercisable  common  stock  options  under the 2004 Plan at January 31,
         2005:
<TABLE>
<CAPTION>
                                        REMAINING     WEIGHTED      NUMBER OF       WEIGHTED
                                       CONTRACTUAL     AVERAGE       OPTIONS         AVERAGE
 RANGE OF EXERCISE       OPTIONS          LIFE        EXERCISE      CURRENTLY       EXERCISE
       PRICES          OUTSTANDING     (IN YEARS)       PRICE      EXERCISABLE        PRICE
--------------------- --------------- -------------- ------------ --------------- --------------
<C>                   <C>             <C>            <C>          <C>             <C>
$  0.06               200,000         9.17           $   0.06     200,000         $   0.06
--------------------- --------------- -------------- ------------ --------------- --------------
</TABLE>

     c)  Warrants

                                    WARRANTS
                                                       OUTSTANDING
                                                     ----------------
Balance, January 31, 2003 and 2004                           -
Warrants granted                                     1,210,800
                                                     ----------------
Balance, January 31, 2005                            1,210,800
                                                     ----------------

         The  following  table lists the common share  warrants  outstanding  at
         January 31, 2005. Each warrant is exchangeable for one common share.

                               EXERCISE                  EXERCISE
         QUANTITY                PRICE                    PERIOD
---------------------- ---------------- ----------------------------------------

403,600                $ 1.50           November 4, 2005 to November 4, 2010
403,600                $ 2.00           May 4, 2006 to May 4, 2011
403,600                $ 2.50           November 4, 2006 to November 4, 2011
---------------------- ---------------- ----------------------------------------
1,210,800
---------------------- ---------------- ----------------------------------------

         At January 31, 2005, none of the warrants outstanding are exercisable.



<PAGE>


                            AMERICAN GOLDFIELDS INC.
                         (FORMERLY BAYMONT CORPORATION)
                         (AN EXPLORATION STAGE COMPANY)

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

                            JANUARY 31, 2005 AND 2004
                            (STATED IN U.S. DOLLARS)



8.   COMMITMENTS

     The Company has the following  commitments  at January 31, 2005 relating to
its property option agreements:
<TABLE>
<CAPTION>

       TWELVE
       MONTHS            IMPERIAL PROPERTY            GILMAN PROPERTY             HERCULES PROPERTY
       ENDING        PROPERTY     EXPLORATION     PROPERTY     EXPLORATION    PROPERTY     EXPLORATION
    DECEMBER 31,     PAYMENTS     EXPENDITURES    PAYMENTS    EXPENDITURES    PAYMENTS     EXPENDITURES      TOTAL
  ----------------- ------------ --------------- ------------ -------------- ------------ --------------- ------------
<S>                 <C>          <C>             <C>          <C>            <C>          <C>             <C>
  2005              $20,000      $  75,000       $15,000      $  50,000      $20,000      $150,000        $330,000
  2006              $20,000      $100,000        $15,000      $ 75,000       $20,000      $200,000        $430,000
  2007              $20,000      $100,000        $15,000      $100,000       $20,000      $300,000        $555,000
  2008              $20,000      $100,000        $15,000      $100,000       $20,000      $400,000        $655,000
  2009              -            $125,000        $15,000      $125,000       $20,000      $500,000        $785,000
  2010              -            -               -            -              $20,000      $500,000        $520,000
  2011              -            -               -            -              $20,000      $500,000        $520,000
  2012              -            -               -            -              $20,000      $500,000        $520,000
  2013              -            -               -            -              $20,000      $500,000        $520,000
  2014              -            -               -            -              $20,000      $500,000        $520,000
  ----------------- ------------ --------------- ------------ -------------- ------------ --------------- ------------

                    $ 80,000     $500,000        $75,000      $450,000       $200,000     $4,050,000      $5,355,000
  ----------------- ------------ --------------- ------------ -------------- ------------ --------------- ------------
</TABLE>


9.   RELATED PARTY TRANSACTIONS

     On May 26, 2004, Mr. Richard Kern joined the Company's  Board of Directors.
     Mr. Kern is also the President of MinQuest.  The Imperial  Property  option
     agreement  requires the Company to use  MinQuest as the primary  contractor
     for exploration  activity undertaken on the property.  All exploration work
     undertaken on any of the Company's  properties will be at the direction and
     discretion of the Company. For the year ended January 31, 2005, the Company
     paid  MinQuest a total of $90,000  (January 31, 2004 - $Nil) related to the
     initial  property  option  payments  for the Imperial  ($60,000),  Hercules
     ($20,000) and Gilman ($10,000) Properties. Included in the net loss for the
     twelve months ended  January 31, 2005 is an amount of $15,400  (January 31,
     2004 - $Nil) with respect to fees paid to Mr. Kern for geological  services
     rendered to the Company.  In addition,  the Company has reimbursed Mr. Kern
     or MinQuest a combined  total of  $52,372.36  (January 31, 2004 - $Nil) for
     expenses including  subcontractor  costs, claim filing fees,  documentation
     preparation,  field sample costs and travel related to exploration activity
     on the Company's properties.


<PAGE>


                            AMERICAN GOLDFIELDS INC.
                         (FORMERLY BAYMONT CORPORATION)
                         (AN EXPLORATION STAGE COMPANY)

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

                            JANUARY 31, 2005 AND 2004
                            (STATED IN U.S. DOLLARS)



10.    SUBSEQUENT EVENTS

       On February 28, 2005, the Company entered into an agreement with MinQuest
       for an option to acquire a 100%  interest in the Crescent  Fault  Claims,
       the Bankop Property, and the Bullion Mountain Property (collectively, the
       `Cortez Properties'). The company made the first scheduled option payment
       of $65,000 upon signing the agreement.  The Cortez Properties  consist of
       an aggregate of  approximately  68 mineral  claims  located in Eureka and
       Lander Counties, Nevada, U.S.A. The agreement requires certain additional
       minimum annual property option payments with a total of $445,000 required
       to be paid by February 15, 2010.  The  agreement  also  requires  minimum
       annual  exploration  expenditures  with a grand  total of  $1,150,000  in
       expenditures  required to be incurred on the property by the February 15,
       2010. The property option agreement is subject to a 3% royalty payable to
       MinQuest  and the  Company is required to use  MinQuest  for  exploration
       conducted on the Cortez Properties.

       On March 22,  2005,  the  Company  executed  an  amendment  to the Gilman
       Property  Option  Agreement with MinQuest.  As a result of the amendment,
       the Company's obligation to incur $50,000 in exploration  expenditures on
       the Gilman  Property  by May 2005 was moved to May 2009.  All other terms
       and commitments of the original  agreement  remain unchanged (see notes 3
       and 8).



ITEM  8.  CHANGES  IN AND  DISAGREEMENTS  WITH  ACCOUNTANTS  ON  ACCOUNTING  AND
FINANCIAL DISCLOSURE

We have had no  disagreements  with its  independent  auditors on  accounting or
financial disclosures.

ITEM 8A.          CONTROLS AND PROCEDURES.

DISCLOSURE CONTROLS AND PROCEDURES. The issuer's principal executive officer and
principal financial  officers,  are responsible for establishing and maintaining
disclosure  controls and procedures (as defined in Exchange Act Rules  13a-15(e)
and  15d-15(e))  and internal  control over  financial  reporting (as defined in
Exchange Act Rules 13a-15(f) and 15d-15(f)) for the issuer and has:

         - designed  such  disclosure  controls and  procedures,  or caused such
disclosure  controls and procedures to be designed under their  supervision,  to
ensure  that  material  information  relating  to  the  issuer,   including  its
consolidated  subsidiaries,  is  made  known  to  them by  others  within  those
entities, particularly during the period in which the periodic reports are being
prepared;

         - designed such internal  control over financial  reporting,  or caused
such  internal  control  over  financial  reporting  to be designed  under their
supervision,  to provide  reasonable  assurance  regarding  the  reliability  of
financial  reporting and the  preparation  of financial  statements for external
purposes in accordance with generally accepted accounting principles;

         - evaluated the effectiveness of the issuer's  disclosure  controls and
procedures as of the end of the fiscal year (the "Evaluation Date").

         Based on their  evaluation as of the  Evaluation  Date,  his conclusion
about the  effectiveness  of the disclosure  controls and  procedures  were that
nothing indicated:

         - any  significant  deficiencies in the design or operation of internal
controls which could adversely affect the issuer's  ability to record,  process,
summarize and report financial data;

         - any fraud, whether or not material, that involves management or other
employees who have a significant role in the issuer's internal controls; or

         - any material weaknesses in internal controls that have been or should
be identified for the issuer's  auditors and disclosed to the issuer's  auditors
and the audit  committee of the board of directors  (or persons  fulfilling  the
equivalent function).

In addition,  the issuer's  disclosure  controls and procedures are effective in
recording, processing, summarizing and reporting, on a timely basis, information
required to be  disclosed by the Company in the reports that it files or submits
under the Exchange Act.

INTERNAL  CONTROL OVER FINANCIAL  REPORTING.  There have not been any changes in
the Company's internal control over financial reporting (as such term is defined
in Rules  13a-15(f)  under the Exchange Act) during the Company's  fourth fiscal
quarter that have materially  affected,  or are reasonably  likely to materially
affect, the Company's internal control over financial reporting.

                                    PART III

ITEM 9.  DIRECTORS AND EXECUTIVE  OFFICERS OF THE  REGISTRANT,  COMPLIANCE  WITH
SECTION 16(A) OF THE EXCHANGE ACT

Set forth  below is  certain  information  concerning  the  Company's  executive
officers and directors during the year ended January 31, 2005.

DIRECTOR:

Name of Director                            Age
----------------------                      -----
Donald Neal                                 54
Gregory Crowe                               50
Richard Kern                                58

EXECUTIVE OFFICER:

Name of Officer            Age              Office
--------------------       -----             -------
Donald Neal                54               President, Treasurer and Secretary

On February 5, 2004, Mr.  Lucrezia  resigned from his position with the Company.
On the same date, Mr. Donald Neal, (54) and Mr. Greg Crowe,  (50) were appointed
as Directors with Mr. Neal elected as President,  Chief Executive Officer, Chief
Financial Officer, Secretary, and Treasurer.

The following is a brief  account of the  education  and business  experience of
each director and executive officer during the past five years:

MR.  DONALD  NEAL,  age 54, is a  professional  engineer  with a  background  in
Projects Engineering  Management.  In his 30 year career, Mr. Neal has developed
extensive  industrial  expertise  in areas  relating to power plant and refinery
engineering and design. He has been involved in the construction supervision and
start-up  phases of plants  throughout  the world,  including the United States,
Canada,  Europe  and Asia.  His  experience  in  industrial  project  management
encompasses  a  range  of  capabilities   including  field  service   expertise,
performance  testing,  failure  analysis and  pulverized  coal firing,  milling,
feeding and fuel conveying systems.  Mr. Neal is a graduate of the University of
Waterloo (Applied  Science),  and is a member of the Association of Professional
Engineers and Geoscientists of British Columbia.  From 2000 to present, Mr. Neal
has worked as an independent  consultant for Mocait's Development Corp. which is
a privately held corporation.  Prior to his present position, Mr. Neal worked as
an Engineering Manager for Utility and Recovery Engineering Ltd.

MR.  GREGORY  CROWE,  age 50,  is a  registered  Professional  Geologist  in the
Canadian provinces of Alberta and British Columbia.  Mr. Crowe has over 20 years
of  exploration,   business  and  entrepreneurial  experience  throughout  North
America, Latin America,  Africa and Southeast Asia. Currently,  Mr. Crowe is the
President,  CEO,  and  Director of Entree Gold Inc.  which is a public  Canadian
junior gold mining company. Over the past five years prior to his appointment to
his current  position,  Mr. Crowe  provided  consulting  services to a number of
mining companies in several countries.  Mr. Crowe also holds a Master of Science
(Geo.).

RICHARD KERN, age 58, is an exploration  geologist with over  twenty-five  years
experience in base and precious metals exploration in the United States, Central
and South America, and Australia.  Mr. Kern worked for Homestake Mining for over
thirteen  years,  where  his  positions  included  Exploration  Manager  Eastern
Australia  and District  Geologist  Western  United  States.  Mr. Kern  directly
managed major exploration  programs in diverse  locations,  including  Malaysia,
Ecuador,  Mexico and the Western U.S. In Nevada,  his team drilled the discovery
holes  into  a 1.6  million  ounce  gold  deposit  which  has  since  gone  into
production,  and a 9 million ounce gold-equivalent deposit in Australia, also in
production.  Mr.  Kern  has  operated  as  an  independent  mineral  exploration
geologist for the last several years, with a focus on the Western United States.
He holds a Bachelor of Science in Geology  (Montana State) and Master of Science
in Geology (Idaho State).

None of our  directors  holds any  directorships  in  companies  with a class of
securities  registered  pursuant to Section 12 of the Securities Exchange Act or
subject  to the  requirements  of  Section  15(d)  of  such  Act or any  company
registered as an investment company under the Investment Company Act of 1940, as
amended.

Our  Directors  are  appointed for a one-year term to hold office until the next
annual  general  meeting of our  shareholders  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.

The Board of Directors has not  established an audit committee and does not have
an audit committee  financial expert.  The Board is of the opinion that an audit
committee is not necessary  since the Company's  directors have been  performing
the functions of an audit committee.

The Board has established an Option Committee and a Compensation Committee, each
consisting of Messrs. Neal and Crowe. The Option Committee recommends and grants
options to  individuals  under the option  plans  adopted  by the  company.  The
Compensation  Committee  recommends and grants  compensation  to individuals who
work for the company.

The Board  does not have a  nominating  committee,  the  functions  of which are
performed by the Board.

SECTION 16(A) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE

Section  16(a) of the Exchange Act requires the  Company's  executive  officers,
directors and persons who  beneficially  own more than 10% of a registered class
of the Company's equity  securities to file with the Commission  initial reports
of  ownership  and  reports of changes in  ownership  of Common  Stock and other
equity  securities  of the  Company.  Such  persons are  required by  Commission
regulations  to furnish the Company with copies of all Section  16(a) forms they
filed.

We are not aware of any instances in fiscal year 2005 when an executive officer,
director  or  owners of more than 10% of the  outstanding  shares of our  common
stock failed to comply with the reporting  requirements  of Section 16(a) of the
Securities Exchange Act of 1934.

The Company has adopted a code of ethics that applies to its principal executive
officer,   principal   financial  officer,   principal   accounting  officer  or
controller,  or persons performing similar functions. For purposes of this Item,
the term code of ethics means written standards that are reasonably  designed to
deter wrongdoing and to promote:

- honest and  ethical  conduct,  including  the  ethical  handling  of actual or
apparent conflicts of interest between personal and professional  relationships;
- full, fair,  accurate,  timely, and  understandable  disclosure in reports and
documents that the issuer files with, or submits to, the Commission and in other
public   communications  made  by  the  issuer;  -  compliance  with  applicable
governmental  laws,  rules and regulations;  - the prompt internal  reporting of
violations of the code to the board of directors or another  appropriate  person
or persons; and - accountability for adherence to the code.

The Company  hereby  undertakes to provide to any person  without  charge,  upon
request,  a copy of such code of ethics.  Such request may be made in writing to
the board of directors at the address of the issuer.

ITEM 10. EXECUTIVE COMPENSATION

The table below  summarizes all  compensation  awarded to, earned by, or paid to
persons  serving as our chief  executive  officer  during the fiscal  year ended
January  31, 2005 for all  services  rendered  in all  capacities  to us for the
fiscal  years ended  January 31, 2005,  2004 and,  2003.  None of our  executive
officers  received  compensation  in excess of  $100,000  during the fiscal year
ended January 31, 2005.

ANNUAL COMPENSATION TABLE
<TABLE>
<CAPTION>
                                Annual Compensation                 Long Term Compensation
--------------- -------------- ------- -------- --------- ---------------- ------------- ------------ ---------- -----------------
Name            Title          Year    Salary   Bonus     Other    Annual  Restricted    Warrants  &  LTIP       All Other
                                                          Compensation     Stock         Options      Payouts    Compensation
                                                                           Awarded                    ($)
--------------- -------------- ------- -------- --------- ---------------- ------------- ------------ ---------- -----------------
<S>             <C>            <C>     <C>      <C>       <C>              <C>           <C>          <C>        <C>
Alfredo         Director,      2005    0        0         0                0             0            0          0
Javier      De  President,
Lucrezia (1)    Secretary,
                and Treasurer
                               2004    5,000    0         0                0             0            0          0
                               2003    0        0         0                0             0            0          0
--------------- -------------- ------- -------- --------- ---------------- ------------- ------------ ---------- -----------------
Donald Neal     Director,
                President,     2005    0        0         0                0             0            0          0
                Secretary,
                and Treasurer
                               2004    0        0         0                0             0            0          0
                               2003    0        0         0                0             0            0          0
--------------- -------------- ------- -------- --------- ---------------- ------------- ------------ ---------- -----------------
</TABLE>

(1) On  February 5, 2004,  Mr.  Lucrezia  resigned  from his  position  with the
Company.  On the same date,  Mr.  Donald Neal was  appointed  as a Director  and
elected  as  President,   Chief  Executive  Officer,  Chief  Financial  Officer,
Secretary, and Treasurer.

STOCK OPTION GRANTS

We did not grant any option, stock appreciation  rights,  warrants or other type
of securities  during the fiscal year ended January 31, 2004. On March 12, 2004,
the Company  granted  1,100,000  stock  options and on April 2, 2004 the Company
granted 600,000 stock options to consultants of the Company.  All of the options
vested immediately and were granted at $0.06 per option.

We  have  no  employment  agreements  with  any of  our  executive  officers  or
employees.

ITEM 11. 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 April 20, 2004 by: (i) each
person  (including  any group) known to us to own more than five percent (5%) of
any  class of our  voting  securities,  (ii)  each of our  directors,  and (iii)
officers and directors as a group.  Information relating to beneficial ownership
of common  stock by our  principal  stockholders  and  management  is based upon
information furnished by each person using "beneficial ownership" concepts under
the rules of the Securities and Exchange Commission. Under these rules, a person
is deemed to be a  beneficial  owner of a security  if that person has or shares
voting  power,  which  includes  the power to vote or direct  the  voting of the
security,  or investment  power,  which includes the power to vote or direct the
voting of the  security.  The person is also deemed to be a beneficial  owner of
any  security of which that person has a right to acquire  beneficial  ownership
within 60 days.

Under the Securities and Exchange  Commission rules, more than one person may be
deemed to be a  beneficial  owner of the same  securities,  and a person  may be
deemed to be a beneficial owner of securities as to which he or she may not have
any pecuniary beneficial interest.

The percentages  below are calculated based on 25,842,878 shares of common stock
issued and outstanding

      Officers, Directors,
         5% Shareholder              No. of Shares       Beneficial Ownership %
        -----------------            -------------       ----------------------

Donald Neal                          3,000,000     (1)            11.6%
6231 Gibbons Drive, Richmond,
B.C., Canada, V7C 2C9

Gregory Crowe                        3,000,000     (1)            11.6%
1679 Eaglecliff Road, Bowen
Island, B.C., Canada, V0N 1G0



All directors and executive
officers as a group (2 persons)
                                     6,000,000                    23.2%


            (1) Each of  Donald  Neal and  Gregory  Crowe  purchased  18,000,000
(giving  effect to the 6:1 forward stock split) shares from Alfredo De Lucrezia,
the  Company's  former  officer and director on February 10, 2004.  On March 31,
2004, each of Messrs. Neal and Crowe returned 15,000,000 shares to the Company.

The persons or entities  named in this table,  based upon the  information  they
have provided to us, have sole voting and  investment  power with respect to all
shares of common stock beneficially owned by them.

CHANGE IN CONTROL

Alfredo De Lucrezia had legal and beneficial ownership of  6,000,000(pre-forward
split)  shares of Common  Stock,  or 66.8% of the issued and  outstanding  share
capital of the Company.  Pursuant to the Purchase and Sale Agreement dated as of
February 10, 2004, among Gregory Crowe, Donald Neal and Alfredo De Lucrezia, Mr.
Lucrezia sold 3,000,000 shares to each of Messrs.  Crowe and Neal. The per share
purchase price was $0.035 per share, or an aggregate of $105,000 paid by each of
Messrs. Crowe and Neal.

Messrs.  Neal and  Crowe  are  party to a  Shareholders'  Agreement  dated as of
February 10, 2004.  The agreement  provides that for so long as the person holds
any of the  3,000,000  shares which he received  from  Alfredo De Lucrezia,  the
directors  shall vote such shares to maintain two persons on our board,  or such
number as the shareholders  agree. Upon any vote to appoint  representatives  to
the Board,  each shareholder  agreed that he shall vote his shares for the other
shareholder.  If one of the  shareholders is no longer a shareholder,  or if the
Board or our  shareholders  decided to remove one of the Board  members,  or the
shareholder  no longer holds any of the 3,000,000  shares which he received from
Mr.  Lucrezia,  then the other  shareholder  agreed to vote his shares to either
maintain  the  number of Board  members  as one or to  nominate  a second  Board
member.  The agreement  also provides that for all other matters in which shares
are voted,  the two  shareholders  shall vote their 3,000,000 shares together as
determined by the unanimous decision of the shareholders.

Each of the shareholders  also agreed that he will not,  directly or indirectly,
sell,  pledge,  gift or in any other way dispose of any of the 3,000,000  shares
which he received from Mr. Lucrezia.  This transfer  restriction  shall apply to
such shares in all situations during all times that such individual holds any of
the 3,000,000 shares.

Other than as described above, there is no agreement or arrangement  between Mr.
Crowe and Mr. Neal with respect to the 6,000,000 shares held by said persons.

ITEM 12. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

Mr. Kern joined the Board of Directors of the Company on May 26, 2004.  Mr. Kern
is also the president of MinQuest.  All of the Company's mineral properties have
been  optioned  from  MinQuest.  As a result,  MinQuest and Mr. Kern are related
parties to the  Company  and both  MinQuest  and Mr.  Kern  receive  substantial
payments from the Company.  In addition,  the Company has agreed to use Mr. Kern
as the  primary  contractor  on  exploration  undertaken  to  date on all of its
properties. The potential exists for conflicts of interest to occur from time to
time that could adversely  affect the Company's  ability conduct its business of
exploration.  Also,  Mr. Kern is the most  knowledgeable  person  regarding  the
historical and current state of exploration on the mineral properties  currently
optioned by the Company. If Mr. Kern were to terminate his relationship with the
Company,  the  Company  would be  adversely  affected  while we found a suitable
replacement.  To date, there have not been any conflicts of interest between the
Company and MinQuest or Mr. Kern.

Other than as described above, none of the following parties has, since our date
of  incorporation,  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:

     o   Any of our directors or officers;
     o   Any person proposed as a nominee for election as a director;
     o   Any  person who  beneficially  owns,  directly  or  indirectly,  shares
         carrying more than 10% of the voting rights attached to our outstanding
         shares of common stock;
     o   Any of our promoters;
     o   Any relative or spouse of any of the  foregoing  persons who has the
same house as such person.

ITEM 13.          EXHIBITS

<TABLE>
<CAPTION>
---------------- -------------------------------------------- -----------------------------------------------
  Exhibit No.                    Description                                   Where Found
---------------- -------------------------------------------- -----------------------------------------------
<S>              <C>                                          <C>
3.1              Articles of Incorporation                    Previously filed with the Company's Form
                                                              SB-2, filed with the SEC on March 13, 2002,
                                                              as amended on Jun 12, 2002, July 18, 2002,
                                                              and August 22, 2002
---------------- -------------------------------------------- -----------------------------------------------
3.2              Bylaws                                       Previously filed with the Company's Form
                                                              SB-2, filed with the SEC on March 13, 2002,
                                                              as amended on Jun 12, 2002, July 18, 2002,
                                                              and August 22, 2002
---------------- -------------------------------------------- -----------------------------------------------
4.1              Share Certificate                            Previously filed with the Company's Form
                                                              SB-2, filed with the SEC on March 13, 2002,
                                                              as amended on Jun 12, 2002, July 18, 2002,
                                                              and August 22, 2002
---------------- -------------------------------------------- -----------------------------------------------
4.2              Form of Class A Warrant                      Previously filed with the Company's Current
                                                              Report on Form 8-K, filed with the SEC on
                                                              November 8, 2004
---------------- -------------------------------------------- -----------------------------------------------
4.3              Form of Class A Warrant                      Previously filed with the Company's Current
                                                              Report on Form 8-K, filed with the SEC on
                                                              November 8, 2004
---------------- -------------------------------------------- -----------------------------------------------
4.4              Form of Class A Warrant                      Previously filed with the Company's Current
                                                              Report on Form 8-K, filed with the SEC on
                                                              November 8, 2004
---------------- -------------------------------------------- -----------------------------------------------
4.5              Form of Private Placement Subscription       Previously filed with the Company's Current
                 Agreement                                    Report on Form 8-K, filed with the SEC on
                                                              November 8, 2004
---------------- -------------------------------------------- -----------------------------------------------
10.1             Property Option Agreement  (relating to      Previously filed with the Company's Current
                 the Gilman Property)                         Report on Form 8-K, filed with the SEC on May
                                                              13, 2004
---------------- -------------------------------------------- -----------------------------------------------
10.2             Property Option Agreement  (relating to      Previously filed with the Company's Current
                 the Imperial Property)                       Report on Form 8-K, filed with the SEC on
                                                              July 9, 2004
---------------- -------------------------------------------- -----------------------------------------------
10.3             Property Option Agreement  (relating to      Previously filed with the Company's Current
                 the Hercules Property)                       Report on Form 8-K, filed with the SEC on
                                                              November 1, 2004
---------------- -------------------------------------------- -----------------------------------------------
10.4             Property Option Agreement  (relating to      Previously filed with the Company's Current
                 the Cortez Properties)                       Report on Form 8-K, filed with the SEC on
                                                              March 2, 2005
---------------- -------------------------------------------- -----------------------------------------------
31.              Rule 13a-14(a)/15d14(a) Certifications Attached Hereto
---------------- -------------------------------------------- -----------------------------------------------
32.              Section 1350 Certifications Attached Hereto
---------------- -------------------------------------------- -----------------------------------------------
</TABLE>

ITEM 14. PRINCIPAL ACCOUNTANT FEES AND SERVICES.

Morgan & Company  has served as the  Company's  Principal  Accountant  since the
Company's  incorporation.  Their fees billed to the Company for the fiscal years
ending January 31, 2005 and 2004 are set forth below:

                           FISCAL YEAR ENDING    FISCAL YEAR ENDING
                            JANUARY 31, 2005      JANUARY 31, 2004
                          ---------------------  --------------------
                            -------------------   -------------------
Audit Fees                $              5,000   $             5,000
Audit Related Fees                         NIL                   NIL
Tax Fees                  $                NIL                   NIL
All Other Fees            $                NIL   $               NIL


As of  January  31,  2005,  the  Company  did  not  have  a  formal,  documented
pre-approval  policy  for the  fees of the  principal  accountant.  It is in the
process of adopting such a policy.




<PAGE>


                                   SIGNATURES

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

                           AMERICAN GOLDFIELDS, INC.
                                             By /S/ Donald Neal
   DATED: APRIL 28, 2005                          -------------
                                                  Donald Neal
                                                  President, Chief Executive
                                                  and Operating Officer,
                                                  Secretary and Treasurer


                                             By  /s/ Greg Crowe
                                                 --------------
   DATED: APRIL 28, 2005                         Greg Crowe
                                                 Director


                                             By  /s/ Richard Kern
                                                 ----------------
   DATED: APRIL 28, 2005                         Richard Kern
                                                 Director



         In accordance  with the Exchange Act, this report has been signed below
by the following  persons on behalf of the  registrant and in the capacities and
on the dates indicated.


                      President, Chief Executive         Dated: April 28, 2005
/s/ Donald Neal       And Operating Officer, Secretary and Treasurer
--------------------------------------------------------------------------------
Donald Neal
                      (Principal  Executive Officer and
                      Principal Financial Officer)
                      Director



 /s/ Greg Crowe                                          Dated: April 28, 2005
--------------------------------------------------------------------------------
Greg Crowe



                      Director
 /s/ Richard Kern                                        Dated: April 28, 2005
--------------------------------------------------------------------------------
Richard Kern