SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549

                                   FORM 10-QSB

          |X| QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE
                         SECURITIES EXCHANGE ACT OF 1934

                 FOR THE QUARTERLY PERIOD ENDED January 31, 2006

                                       OR

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

              FOR THE TRANSITION PERIOD FROM ________ TO __________

                         REGISTRATION NUMBER 333-101960

                          YUKON GOLD CORPORATION, INC.
             (Exact name of registrant as specified in its charter)

               DELAWARE                                52-2243048
     (State or other jurisdiction of                (I.R.S. Employer
      incorporation or organization)                Identification No.)

               347 BAY STREET, SUITE 408, TORONTO, ONTARIO M5H 2R7
               (Address of principal executive offices) (Zip Code)

       Registrant's telephone number, including area code: (416) 865-9790

Check whether the issuer (1) filed all reports required to be filed by Section
13 or 15 (d) of the Exchange Act during the past 12 months (or such shorter
period that the registrant was required to file such reports), and (2) has been
subject to such filing requirements for the past 90 days.

                 YES |X|                            NO |_|

State the number of shares outstanding of each of the issuer's classes of common
equity, as of the latest practicable date:

    Class                                  Outstanding As of January 31, 2006
    Common Shares $ .0001 par value                    11,000,401


<PAGE>


                          YUKON GOLD CORPORATION, INC.
                         (AN EXPLORATION STAGE COMPANY)
                    INTERIM CONSOLIDATED FINANCIAL STATEMENTS
                                JANUARY 31, 2006
                        (AMOUNTS EXPRESSED IN US DOLLARS)
                                   (UNAUDITED)


<PAGE>


                          YUKON GOLD CORPORATION, INC.
                         (AN EXPLORATION STAGE COMPANY)
                    INTERIM CONSOLIDATED FINANCIAL STATEMENTS
                    -----------------------------------------
                                JANUARY 31, 2006
                        (AMOUNTS EXPRESSED IN US DOLLARS)
                                   (UNAUDITED)

                                TABLE OF CONTENTS
                                                                         PAGE NO

Interim Consolidated Balance Sheets as of
       January 31, 2006 and April 30, 2005                                  1-2

Interim Consolidated Statements of Operations
       for the nine months and three
       months ended January 31, 2006 and January 31, 2005                      3

Interim Consolidated Statements of Cash Flows
       for the nine months ended January
       31, 2006 and January 31, 2005                                           4

Interim Consolidated Statements of Changes in
       Stockholders' Deficiency for the
       nine months ended January 31, 2006 and year
       ended April 30, 2005                                                    5

Condensed Notes to Interim Consolidated Financial Statements                6-13


<PAGE>


YUKON GOLD CORPORATION, INC.
(AN EXPLORATION STAGE COMPANY)
INTERIM CONSOLIDATED BALANCE SHEETS
AS AT JANUARY 31, 2006 AND APRIL 30, 2005
(AMOUNTS EXPRESSED IN US DOLLARS)
(UNAUDITED)


                                                        January 31,   April 30,
                                                            2006        2005
                                                              $           $
                                                        -----------  -----------
                                     ASSETS
       CURRENT ASSETS

    Cash and cash equivalents                                50,090       79,256
    Prepaid expenses and other                               70,680      103,832
    Exploration Tax Credit Receivable                          --         72,203
                                                        -----------  -----------



                                                            120,770      255,291

RESTRICTED CASH (Note 10)                                   169,465         --
PROPERTY, PLANT AND EQUIPMENT (Note 13)                      24,372        4,778

                                                        -----------  -----------
                                                            314,607      260,069
                                                        ===========  ===========


            See condensed notes to the interim consolidated financial
                                  statements.



APPROVED ON BEHALF OF THE BOARD


/s/ Ken J. Hill
    -----------
Ken J. Hill, CEO, Director


                                       1
<PAGE>


YUKON GOLD CORPORATION, INC.
(AN EXPLORATION STAGE COMPANY)
INTERIM CONSOLIDATED BALANCE SHEETS
AS AT JANUARY 31, 2006 AND APRIL 30, 2005
(AMOUNTS EXPRESSED IN US DOLLARS)
(UNAUDITED)


                                                       January 31,    April 30,
                                                          2006          2005

                                                           $             $
                                                      -----------   -----------

                                          LIABILITIES

       CURRENT LIABILITIES

    Accounts payable and accrued liabilities              232,121        83,897

    Convertible promissory note (see note 8)                   --       200,500

    Demand promissory notes (see note 5)                  250,973       498,649
                                                      -----------   -----------
                                                          483,094       783,046
                                                      -----------   -----------

                                  SHAREHOLDERS' DEFICIENCY

CAPITAL STOCK (Note 6)                                      1,101           903

ADDITIONAL PAID-IN CAPITAL                              2,286,995       854,430

     SUBSCRIPTION FOR WARRANTS (Note 7)                   584,000          --

ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS)             (14,381)       (2,475)

DEFICIT, ACCUMULATED DURING THE EXPLORATION STAGE      (3,026,202)   (1,375,835)
                                                      -----------   -----------
                                                         (168,487)     (522,977)
                                                      -----------   -----------
                                                          314,607       260,069
                                                      ===========   ===========


            See condensed notes to the interim consolidated financial
                                  statements.


                                        2
<PAGE>


YUKON GOLD CORPORATION, INC.
(AN EXPLORATION STAGE COMPANY)
INTERIM CONSOLIDATED STATEMENTS OF OPERATIONS
FOR THE NINE MONTHS AND THREE MONTHS ENDED JANUARY 31, 2006 AND JANUARY 31, 2005
(AMOUNTS EXPRESSED IN US DOLLARS)
(UNAUDITED)


<TABLE>
<CAPTION>
                                                          For the       For the       For the         For the
                                                          nine months   nine months   three months    three months
                                            Cumulative    ended         ended         ended           ended
                                               since      January 31,   January 31,   January 31,     January 31,
                                             inception       2006          2005           2006            2005
                                            -----------   -----------   -----------   ------------   ------------
                                                  $             $            $              $              $
<S>                                         <C>           <C>           <C>           <C>            <C>
REVENUE                                          --            --           --             --             --
                                            -----------   -----------   -----------   ------------   ------------
OPERATING EXPENSES

      Stock-based compensation                  139,923       139,923          --           39,823           --
      General and administration              1,185,154       648,429       215,314        377,579         83,410
      Project expenses                        1,837,399       861,261       263,257        610,740         13,924
      Exploration Tax Credit                   (140,289)         --         (44,012)          --             --
      Amortization                                4,015           754           879            258            308
                                            -----------   -----------   -----------   ------------   ------------

TOTAL OPERATING EXPENSES                      3,026,202     1,650,367       435,438      1,028,400         97,642
                                            -----------   -----------   -----------   ------------   ------------


LOSS BEFORE INCOME TAXES                     (3,026,202)   (1,650,367)     (435,438)    (1,028,400)       (97,642)

      Income taxes                                 --            --            --             --             --
                                            -----------   -----------   -----------   ------------   ------------

NET LOSS                                     (3,026,202)   (1,650,367)     (435,438)    (1,028,400)       (97,642)
                                            -----------   -----------   -----------   ------------   ------------


Earnings per share - basic and diluted                          (0.17)        (0.05)         (0.10)         (0.01)
                                                          -----------   -----------   ------------   ------------

Weighted average common shares outstanding                   9,921,522     8,815,508    10,740,830      8,815,508
                                                          -----------   -----------   ------------   ------------
</TABLE>


                 See condensed notes to the interim consolidated
                             financial statements.


                                       3
<PAGE>


YUKON GOLD CORPORATION, INC.
(AN EXPLORATION STAGE COMPANY)
INTERIM CONSOLIDATED STATEMENTS OF CASH FLOWS
FOR THE NINE MONTHS ENDED JANUARY 31, 2006 AND JANUARY 31, 2005
(AMOUNTS EXPRESSED IN US DOLLARS)
(UNAUDITED)


<TABLE>
<CAPTION>
                                                                               For the               For the
                                                                             nine months            nine months
                                                               Cumulative       ended                 ended
                                                                  since      January 31,            January 31,
                                                                inception        2006                  2005
                                                                    $              $                     $
                                                               -----------   -----------            -----------
<S>                                                            <C>           <C>                    <C>
CASH FLOWS FROM OPERATING ACTIVITIES
Net loss for the period                                         (3,026,202)   (1,650,367)              (435,438)
Items not requiring an outlay of cash:
     Amortization                                                    4,015           754                    879
     Shares issued for property payment                            314,242       100,000                   --
     Stock-based compensation                                      139,923       139,923                   --
     Issue of shares for professional services                     130,500       130,500                   --
     Issue of units against settlement of debts                     20,077        20,077                   --
     Decrease (Increase) in prepaid expenses and deposits          (69,523)       44,046                (23,726)
     Decrease (Increase) in exploration tax credit receivable         --          72,203                   --
     Increase (Decrease) in accounts payable                       231,631       148,224                 (5,904)
     Decrease (Increase) in deferred financing cost                   --            --                  (23,777)
     Decrease (Increase) in Restricted cash                       (169,465)     (169,465)                  --
                                                               -----------   -----------            -----------


NET CASH USED IN OPERATING ACTIVITIES                           (2,424,802)   (1,164,105)              (487,966)
                                                               -----------   -----------            -----------
CASH FLOWS FROM INVESTING ACTIVITIES
    Purchase of property, plant and equipment                      (26,099)      (19,315)                  --
                                                               -----------   -----------            -----------

NET CASH USED IN INVESTING ACTIVITIES                              (26,099)      (19,315)                  --
                                                               -----------   -----------            -----------


CASH FLOWS FROM FINANCING ACTIVITIES
    Repayments from a shareholder                                    1,180          --                     --
    Proceeds from Convertible promissory note                      200,500          --                  256,750
    Proceeds (Repayments) from Demand promissory notes             450,973       (47,676)               180,567
    Proceeds from exercise of warrants                              20,772        20,772                   --
    Proceeds from issuance of Units/shares                       1,255,019       613,927                   --
    Proceeds from subscription of warrants                         584,000       584,000                   --
                                                               -----------   -----------            -----------


NET CASH PROVIDED BY FINANCING ACTIVITIES                        2,512,444     1,171,023                437,317
                                                               -----------   -----------            -----------

EFFECT OF FOREIGN CURRENCY EXCHANGE
    RATE CHANGES                                                   (11,453)      (16,769)                 8,641
                                                               -----------   -----------            -----------


NET INCREASE (DECREASE) IN CASH AND CASH
   EQUIVALENTS FOR THE PERIOD                                       50,090       (29,166)               (42,008)

    Cash and cash equivalents, beginning of year                      --          79,256                134,925
                                                               -----------   -----------            -----------


CASH AND CASH EQUIVALENTS, END OF                                   50,090        50,090                 92,917
    PERIOD
                                                               ===========   ===========            ===========

INCOME TAXES PAID                                                                   --                     --
                                                                             ===========            ===========
INTEREST PAID                                                                                             3,495
                                                                                                    ===========
</TABLE>


     See condensed notes to the interim consolidated financial statements.


                                        4

<PAGE>


YUKON GOLD CORPORATION, INC.
(AN EXPLORATION STAGE COMPANY)
INTERIM CONSOLIDATED FINANCIAL STATEMENTS OF CHANGES IN STOCKHOLDERS' DEFICIENCY
FOR THE NINE MONTHS ENDED JANUARY 31, 2006 AND THE YEAR ENDED APRIL 30, 2005
(AMOUNTS EXPRESSED IN US DOLLARS) (UNAUDITED)


<TABLE>
<CAPTION>
                                                                                           Deficit,
                                                                                          accumulated                  Accumulated
                                        Number of     Common    Additional  Subscription  during the                     Other
                                         Common       Shares     Paid-in        for       exploration  Comprehensive  Comprehensive
                                         Shares       amount     Capital      warrants       stage     Income (loss)  Income (loss)
                                        ----------  ----------  ----------  ------------  -----------  -------------  -------------
<S>                                     <C>         <C>         <C>         <C>           <C>          <C>            <C>
                                                         $           $                         $             $              $

Balance as of April 30, 2004             8,815,508         882     697,299                   (567,689)      (455,702)       (12,192)
                                                                                                           =========
Issuance of Common shares
  for property payment                     133,333          13      99,987                       --              --             --
Issuance of common shares on
  Conversion of Convertible
  Promissory note                           76,204           8      57,144                       --              --             --
Foreign currency translation                                                                     --            9,717          9,717
Net loss for the year                           --          --          --                   (808,146)      (808,146)           --
                                        ----------  ----------  ----------  ------------  -----------  -------------  -------------

Balance as of April 30, 2005             9,025,045         903     854,430          --     (1,375,835)      (798,429)        (2,475)
                                                                                                           =========
Stock based compensation-directors                                  95,840
Stock based compensation-consultant          4,260
Issue of common shares and
  Warrants on retirement of
  Demand Promissory note                   369,215          37     203,031
Units issued to an outside company
  for professional services settlement      24,336           2      13,384
Units issued to an officer
  for professional services settlement      12,168           1       6,691
Units issued to a director                 149,867          15      82,412
Units issued to outside subscribers        200,000          20     109,980
Units issued to shareholder                490,909          49     269,951
Issuance of common shares
  for professional services                150,000          15     130,484
Issuance of common shares on
  Conversion of Convertible
  Promissory notes                          59,547           6      44,654
Issuance of common shares on
     Exercise of warrants                   14,000           2      11,998
Issuance of common shares on
    Conversion of Convertible
    Promissory notes                        76,525           8      57,386
Private placement of shares                150,000          15     151,485
Issuance of common shares on
   Conversion of Convertible
   Promissory notes                         34,306           4      25,905
Issuance of common shares on
   Exercise of warrants                     10,000           1       8,771
Issuance of Common shares
  for property payment                     133,333          13      99,987
Issuance of common shares on
   Conversion of Convertible
   Promissory notes                        101,150          10      76,523
Stock based compensation-
   Directors and officers                                           39,193
Stock based compensation-
   Consultant                                                          630
Issue of 400,000 Special Warrants                                                404,000
Issue of 200,000 Flow through warrants                                           180,000
Foreign currency translation                  --          --          --                         --          (11,906)       (11,906)
Net loss for the 9 months                     --          --          --            --     (1,650,367)    (1,650,367)
                                        ----------  ----------  ----------  ------------  -----------  -------------  -------------

Balance as of January 31, 2006          11,000,401       1,101   2,286,995       584,000   (3,026,202)    (1,662,273)       (14,381)
                                        ==========  ==========  ==========  ============  ===========  =============  =============
</TABLE>


            See condensed notes to the interim consolidated financial
                                  statements.


                                        5
<PAGE>


YUKON GOLD CORPORATION, INC.
(AN EXPLORATION STAGE COMPANY)
CONDENSED NOTES TO INTERIM CONSOLIDATED FINANCIAL STATEMENTS
JANUARY 31, 2006
(AMOUNTS EXPRESSED IN US DOLLARS)
(UNAUDITED)

      1. BASIS OF PRESENTATION

            The accompanying unaudited interim consolidated financial statements
            do not include all the information and footnotes required by
            generally accepted accounting principles for complete financial
            statements. In the opinion of management, all adjustments
            (consisting of all recurring accruals) considered necessary for fair
            presentation have been included. Operating results for the interim
            period are not necessarily indicative of the results that may be
            expected for the year ended April 30, 2006. Interim financial
            statements should be read in conjunction with the Company's annual
            audited financial statements.

            The interim consolidated financial statements include the accounts
            of Yukon Gold Corporation, Inc. (the "Company") and its wholly owned
            subsidiary Yukon Gold Corp. ("YGC"). All material inter-company
            accounts and transactions have been eliminated.

      2. NATURE OF OPERATIONS AND GOING CONCERN

            The Company was incorporated under the laws of the state of Delaware
            on May 31, 2000 as Realdarts International, Inc. On August 3, 2000,
            the Articles of Incorporation were amended to change the name to
            Optima 2000, Inc. On August 8, 2000 the name was changed again to
            Optima International, Inc. and again on the same date to Optima
            Global Corporation. On February 5, 2001, the Company entered into a
            merger with Optima Global Corp. (a Florida Corporation) whereby the
            corporation issued one share of its stock for each share held by the
            stockholders of the Florida Corporation. On November 20, 2002, the
            Company changed its name to Take 4, Inc. and then on October 29,
            2003 the Company became Yukon Gold Corporation, Inc.

            The Company has no source for operating revenue and expects to incur
            significant expenses before establishing revenue. The Company's
            future success is dependent upon its ability to raise sufficient
            capital, not only to maintain its general and administrative
            expenses, but also to continue to explore for ore reserves and
            develop those it has on its mining claims. There is no guarantee
            that such capital will be available on acceptable terms, if at all.

      3. REVERSE ACQUISITION

            On November 17, 2003, the Company concluded a series of transactions
            whereby it acquired 100% of the common shares of YGC. In
            consideration for this acquisition, the Company issued 4,027,932
            Common shares to the former shareholders of YGC, which represented
            59.5 % of the outstanding common shares of the Company on that date.

            Notwithstanding that the Company became the legal acquirer of YGC;
            this transaction has been accounted for in these financial
            statements as a reverse merger equivalent to the issuance of stock
            by YGC for the net monetary assets of the Company accompanied by a
            recapitalization.

      4. COMMITMENTS AND CONTINGENCIES

      (a) Mount Hinton area mining claims

            On July 7, 2002 YGC entered into an option agreement with the Hinton
            Syndicate to acquire a 75% interest in the 273 unpatented mineral
            claims covering approximately 14,000 acres in the Mayo Mining
            District of the Yukon Territory, Canada. This agreement was replaced
            with a revised and amended agreement (the "Hinton Option Agreement")
            dated July 7, 2005 which superseded the original agreement and
            amendments thereto. The new agreement is between the Company, its
            wholly owned subsidiary YGC and the Hinton Syndicate.

            YGC must make scheduled cash payments and perform certain work
            commitments to earn up to a 75% interest in the mineral claims,
            subject to a 2% net smelter return royalty in favor of the Hinton
            Syndicate, as further described below.


                                        6
<PAGE>


YUKON GOLD CORPORATION, INC.
(AN EXPLORATION STAGE COMPANY)
CONDENSED NOTES TO INTERIM CONSOLIDATED FINANCIAL STATEMENTS
JANUARY 31, 2006
(AMOUNTS EXPRESSED IN US DOLLARS)
(UNAUDITED)

      4. COMMITMENTS AND CONTINGENCIES - CONT'D.

            The schedule of Property Payments and Work Programs are as follows:

            PROPERTY PAYMENTS
            -----------------

<TABLE>
            <S>                                                                  <C>
            On execution of the July 7, 2002 Agreement                           $   19,693   (CDN  $   25,000) Paid
            On July 7, 2003                                                      $   59,078   (CDN  $   75,000) Paid
            On July 7, 2004                                                      $  118,157   (CDN  $  150,000) Paid
            On January 2, 2006                                                   $  125,313   (CDN  $  150,000) Paid
            On July 7, 2006                                                      $  131,694   (CDN  $  150,000)
            On July 7, 2007                                                      $  131,694   (CDN  $  150,000)
            On July 7, 2008                                                      $  131,694   (CDN  $  150,000)
                                                           TOTAL                 $  717,323   (CDN  $  850,000)

            WORK PROGRAM-expenditures to be incurred in the following periods:

            July 7/02 to July 6/03                                               $  118,157   (CDN  $  150,000) Incurred
            July 7/03 to July 6/04                                               $  196,928   (CDN  $  250,000) Incurred
            July 7/04 to July 6/05                                               $  256,006   (CDN  $  325,000) Incurred
            July 7/05 to Dec. 31/06                                              $  658,472   (CDN  $  750,000)
            Jan. 1/07 to Dec. 31/07                                              $  877,963   (CDN  $1,000,000)
            Jan. 1/08 to Dec. 31/08                                              $1,097,454   (CDN  $1,250,000)
            Jan. 1/09 to Dec. 31/09                                              $1,316,945   (CDN  $1,500,000)
                                                           TOTAL                 $4,521,925   (CDN  $5,225,000)
</TABLE>


            Provided all Property Payments have been made that are due prior to
            the Work Program expenditure levels being attained, YGC shall have
            earned a:

            25% interest upon Work Program expenditures of $1,316,945
                (CDN$1,500,000)

            50% interest upon Work Program expenditures of $2,194,908
                (CDN$2,500,000)

            75% interest upon Work Program expenditures of $4,521,925
                (CDN$5,225,000)


            In some cases, payments made to service providers include amounts
            advanced to cover the cost of future work. These advances are not
            loans but are considered "incurred" exploration expenses under the
            terms of the Hinton Option Agreement. Section 2.2(a) of the Hinton
            Option Agreement defines the term, "incurred" as follows: "Costs
            shall be deemed to have been "incurred" when YGC has contractually
            obligated itself to pay for such costs or such costs have been paid,
            whichever should first occur." Consequently, the term, "incurred"
            includes amounts actually paid and amounts that YGC has obligated
            itself to pay. Under the Hinton Option Agreement there is also a
            provision that YGC must have raised and have available the Work
            Program funds for the period from July 7, 2005 to December 31, 2006,
            by May 15 of 2006.

            The Hinton Option Agreement contemplates that upon the earlier of:
            (i) a production decision or (ii) investment of $4,521,925
            (CDN$5,225,000) or (iii) YGC has a minority interest and decides not
            to spend any more money on the project, YGC's relationship with the
            Hinton Syndicate will become a joint venture for the further
            development of the property. Under the terms of the Hinton Option
            Agreement, the party with the majority interest would control the
            joint venture. Once the 75% interest is earned, as described above,
            YGC has a further option to acquire the remaining 25% interest in
            the mineral claims for a further payment of $4,389,816
            (CDN$5,000,000).

            The Hinton Option Agreement provides that the Hinton Syndicate
            receive a 2% "net smelter return royalty." In the event that the
            Company exercises its option to buy-out the remaining 25% interest
            of the Hinton Syndicate (which is only possible if the Company has
            reached a 75% interest, as described above) then the "net smelter
            return royalty" would become 3% and the Hinton Syndicate would
            retain this royalty interest only. The "net smelter return royalty"
            is a percentage of the gross revenue received from the sale of the
            ore produced from the mine less certain permitted expenses.


                                       7
<PAGE>

YUKON GOLD CORPORATION, INC.
(AN EXPLORATION STAGE COMPANY)
CONDENSED NOTES TO INTERIM CONSOLIDATED FINANCIAL STATEMENTS
JANUARY 31, 2006
(AMOUNTS EXPRESSED IN US DOLLARS)
(UNAUDITED)


      4. COMMITMENTS AND CONTINGENCIES - CONT'D.

            The Hinton Option Agreement entitles the Hinton Syndicate to
            recommend for appointment one member to the board of directors of
            the Company.

            The Hinton Option Agreement provides both parties (YGC and Hinton
            Syndicate) with rights of first refusal in the event that either
            party desires to sell or transfer its interest.

            The Hinton Syndicate members each have the option to receive their
            share of property payments in stock of the Company at a 10% discount
            to the market, once the Company has obtained a listing on a Canadian
            stock exchange. YGC and the Company have a further option to pay 40%
            of any property payment due after the payment on January 2, 2006
            with common stock of the Company.

            b) The Marg Property

            In March 2005, the Company acquired rights to purchase 100% of the
            Marg Property which consists of 402 contiguous mineral claims
            covering approximately 20,000 acres located in the Mayo Mining
            District of the Yukon Territory of Canada. Title to the claims is
            registered in the name of YGC.

            The Company assumed the rights to acquire the Marg Property under a
            Property Purchase Agreement ("Agreement") with Atna Resources Ltd.
            ("Atna"). Under the terms of the Agreement the Company paid $119,189
            (CDN$150,000) cash and 133,333 common shares as a down payment. The
            Company made payments under the Agreement for $43,406 (CDN$50,000)
            cash and additional 133,333 common shares of the Company on December
            12, 2005 (see note 6).

            The Company has agreed to make subsequent payments under the
            Agreement of (i) $87,796 (CDN$100,000) cash and an additional
            133,334 common shares of the Company on or before December 12, 2006;
            (ii) $87,796 (CDN$100,000) cash on or before December 12, 2007; and
            (iii) $175,592 (CDN$200,000) in cash and/or common shares of the
            Company (or some combination thereof to be determined) on or before
            December 12, 2008. Upon the commencement of commercial production at
            the Marg Property, the Company will pay to Atna $877,960
            (CDN$1,000,000) in cash and/or common shares of the Company, or some
            combination thereof to be determined.

      5. DEMAND PROMISSORY NOTES

            On June 25, 2004 the Company issued an unsecured demand promissory
            note to an arms length shareholder for $100,000. The note is
            non-interest bearing and due on demand. The Company paid a financing
            fee of $5,000. The arms length shareholder subsequently became a
            director of the Company on November 2, 2005.

            On March 1, 2005 the Company entered into a Loan Agreement with
            Medallion Capital Corp. ("Medallion") under which it promised to pay
            Medallion on demand $198,649 (CDN$250,000). The loan bears interest
            at 9% per annum payable monthly. The obligation of the Company under
            the Loan Agreement was secured by all of its rights in and to the
            Marg Acquisition Agreement. The $198,649 (CDN$250,000) principal
            amount of the demand note represents the aggregate of $79,460
            (CDN$100,000) advanced to the Company on June 28, 2004 by Stafford
            Kelley and $119,189 (CDN$150,000) advanced by Medallion to Atna for
            the Marg Property. Mr. Kelley's $79,460 (CDN$100,000) loan was
            assigned to Medallion and that note has been cancelled. The Company
            paid $47,676 (CDN$60,000) of the principal amount of the Loan due
            Medallion on June 30, 2005. On September 12, 2005 Medallion released
            the Company from the obligation to secure the loan with the rights
            under the Marg Acquisition Agreement and the obligation is now
            secured with a demand promissory note only. Medallion is controlled
            by Stafford Kelley a former officer and director of the Company. Mr.
            Kelley has earned a $4,085 (CDN$5,000) financing fee related to the
            transaction and was paid that amount on August 31, 2005. The Company
            has agreed to repay this loan if it is successful in raising $3.0
            million as per an agreement with a placement agent in Canada as
            further described in Note 14 - SUBSEQUENT EVENTS.


                                       8
<PAGE>


YUKON GOLD CORPORATION, INC.
(AN EXPLORATION STAGE COMPANY)
CONDENSED NOTES TO INTERIM CONSOLIDATED FINANCIAL STATEMENTS
JANUARY 31, 2006
(AMOUNTS EXPRESSED IN US DOLLARS)
(UNAUDITED)


      5. DEMAND PROMISSORY NOTES - CON'T

            On April 15, 2005 the Company issued an unsecured demand promissory
            note to an arms length shareholder for $200,000. This note bears
            interest at 5% per annum. This note was repaid with the issuance of
            369,215 common shares and 184,608 share purchase warrants. (See note
            6 below)

      6. ISSUANCE OF COMMON SHARES AND WARRANTS

            On August 5, 2005 the board of directors authorized the issuance of
            369,215 common shares and 184,608 share purchase warrants in
            settlement of a demand promissory note in the amount of $200,000
            plus interest of $3,068.25. Each common share was priced at $0.545
            and each full warrant at $0.01. Each share purchase warrant entitles
            the holder to purchase one common share for $1.00 per share on or
            before August 5, 2007.

            On August 23, 2005 the board of directors approved the issuance of
            24,336 Units to an arms length investor and 12,168 Units to an
            officer of the Company at $0.55 per Unit, in settlement of an
            accounts payable for services, for a total of $20,077 (CDN$24,398).
            Each Unit consists of one common share and one half-share purchase
            warrant. Each common share was priced at $0.545 and each full
            warrant at $0.01. Each full-share purchase warrant entitles the
            holder to purchase one common share at $1.00 per share for a period
            expiring on August 15, 2007.

            On August 25, 2005 the Company entered into a Consulting Agreement
            with Endeavor Holdings, Inc. (Endeavor) of New York, New York to
            assist the Company in raising capital. Under the terms of this
            agreement the Company agreed to pay Endeavor 150,000 common shares
            at the rate of 25,000 shares per month. Either party may cancel the
            agreement on 30 days notice. As of October 31, 2005 the Company had
            issued 75,000 common shares valued at $65,250, to Endeavor. As of
            the three months ended January 31, 2006 the Company had issued the
            final 75,000 common shares valued at $65,250.

            On August 26, 2005 the board of directors approved the issuance of
            490,909 Units at $0.55 per Unit to an arms length accredited
            shareholder for a total of $270,000. Each Unit consists of one
            common share and one half-share purchase warrant. Each common share
            was priced at $0.545 and each full warrant at $0.01. Each full-share
            purchase warrant entitles the holder to purchase one common share at
            $1.00 per share, after one year and seven days following closing,
            for a period of two (2) years following the date that is one year
            and seven days after the closing. The Company received $20,000 of
            the subscription price on August 12, 2005 as a loan to be applied to
            the subscription price and $100,000 on September 15, 2005 and a
            promissory note for $150,000 due on or before October 1, 2005 for
            the balance of the subscription price. The Promissory note was paid
            in full by the due date. This arms length shareholder subsequently
            became a director of the Company on November 2, 2005.

            On August 29, 2005, the Company completed the sale of 149,867 Units
            at $0.55 per Unit to a director of the Company for $82,427
            (CDN$100,000). Each Unit consists of one common share and one
            half-share purchase warrant. Each common share was priced at $0.545
            and each full warrant at $0.01. Each full-share purchase warrant
            entitles the holder to purchase one common share at $1.00 per share
            for a period expiring on August 5, 2007.

            On August 31, 2005, the Company accepted subscriptions from four
            accredited investors and one accredited corporation, all residents
            of Canada, for a total of 200,000 Units priced at $0.55 per Unit for
            a total of $110,000. Each Unit consists of one common share and one
            half-share purchase warrant. Each common share was priced at $0.545
            and each full warrant at $0.01. Each full-share purchase warrant
            entitles the holder to purchase one common share at $1.00 per share
            for a period expiring August 31, 2007.

            On October 18, 2005 the Company authorized the issuance of 14,000
            common shares for the exercise of 14,000 warrants from a warrant
            holder in consideration of $12,000.

            On October 18 and 24, 2005 the Company issued a total of 59,547
            common shares and 29,167 warrants covering the principal amount of
            $43,750 plus interest of $910 on conversion of the convertible
            promissory notes issued on October 6, 2004.


<PAGE>


YUKON GOLD CORPORATION, INC.
(AN EXPLORATION STAGE COMPANY)
CONDENSED NOTES TO INTERIM CONSOLIDATED FINANCIAL STATEMENTS
JANUARY 31, 2006
(AMOUNTS EXPRESSED IN US DOLLARS)
(UNAUDITED)


      6. ISSUANCE OF COMMON SHARES AND WARRANTS - CON'T

            On November 9, 2005, the accredited investor converted the
            promissory note, referred to in Note 8 (b) below, on its due date
            and the Company issued 76,525 common shares and 37,500 warrants
            covering the principal amount of $56,250 and interest in the amount
            of $1,143 in accordance with the conversion provisions of the notes.
            The expiry date of the warrants was extended to 15 months after the
            conversion date.

            On December 5, 2005, the board of directors authorized the issuance
            of 150,000 common shares and 150,000 share purchase warrants in
            consideration of $100,000 in cash and a promissory note for $51,500
            due on January 15, 2006. Each common share was valued at $1.00 and
            each warrant at $0.01. Each warrant entitles the warrant holder to
            purchase one common share at $1.00 on or before December 4, 2006. As
            of January 31, 2006 an amount of $1,500 was outstanding and
            receivable against the promissory note which was subsequently paid
            (see note in subsequent events).

            On December 6, 2005, the board of directors authorized the issuance
            of 133,333 common shares in the amount of $100,000 for property
            payments to Atna Resources Ltd. along with a cash payment of $43,406
            (CDN$50,000) as per the terms of the agreement. The common shares
            along with the cash payment were delivered to Atna Resources Ltd. on
            December 12, 2005. This entire payment of $143,406 was expensed in
            the consolidated statement of operations.

            On December 7, 2005, an accredited investor converted the promissory
            notes, referred to in Note 8 (c) below on their due dates and the
            company issued 34,306 common shares and 17,001 warrants covering the
            principal amounts of $25,500 and interest in the amount of $409 in
            accordance with the conversion provisions of the notes. The expiry
            date of the warrants was extended to 15 months after the conversion
            date.

            On December 7, 2005, the board of directors authorized the issuance
            of 10,000 common shares to a shareholder for the exercise of 10,000
            warrants in consideration of 8,772 (CDN $10,000).

            On January 11, 2006 an accredited investor converted the promissory
            notes, referred to in Note 8 (d) on their due dates and the company
            issued 101,150 common shares and 50,000 warrants covering the
            principal amounts of $75,000 and interest in the amount of $1,533 in
            accordance with the conversion provisions of the notes. The expiry
            date of the warrants was extended to 15 months after the conversion
            date.


<PAGE>


YUKON GOLD CORPORATION, INC.
(AN EXPLORATION STAGE COMPANY)
CONDENSED NOTES TO INTERIM CONSOLIDATED FINANCIAL STATEMENTS
JANUARY 31, 2006
(AMOUNTS EXPRESSED IN US DOLLARS)
(UNAUDITED)


      7. SUBSCRIPTION FOR WARRANTS

            On December 15, 2005, the Company completed the sale of 400,000
            Special Warrants to an accredited investor, for $404,000. Each
            Special Warrant entitles its holder to acquire one common share of
            the Company at a purchase price of $1.00 per share and one common
            share purchase warrant which entitles the holder to purchase an
            additional common share at a purchase price of $0.01 per share. The
            Special Warrants may not be exercised until the earlier of: (i) the
            Qualification Time (as defined below), or (ii) the date which is 181
            days from the closing date of the sale of the Special Warrants (the
            "Expiry Time"). All Special Warrants will be automatically exercised
            or deemed exercised without any further action on the part of the
            holder at 4:30 p.m. (Toronto time) on the earlier of: (i) the fifth
            business day after the date upon which a registration statement to
            be filed by the Company under the Securities Act of 1933, as
            amended, has been declared effective by the Securities and Exchange
            Commission with respect to the distribution of the common shares and
            warrants issuable upon exercise of the Special Warrants (the
            "Qualification Time") or (ii) the Expiry Time. If by 4:30 p.m.
            (Toronto time) on the date which is 180 days from the closing date
            such registration statement has not been declared effective, the
            holders of Special Warrants shall thereafter be entitled to receive,
            upon the exercise or deemed exercise of the Special Warrants, 1.1
            common shares and 1.1 warrants for each Special Warrant then held by
            such holder (in lieu of one common share and one warrant otherwise
            receivable) at no additional cost. The Company has undertaken to use
            its reasonable best efforts to file a registration statement under
            the Securities Act of 1933 to qualify the shares and warrants
            underlying the Special Warrants with the objective of being declared
            effective on or before 180 days from closing.

            On December 30, 2005 the Company completed the sale of 200,000
            Flow-Through Special Warrants ("FT Special Warrants") to National
            Bank Trust Inc. for the account of a Canadian accredited investor,
            for $180,000 (CDN$205,020). Each FT Special Warrant entitles the
            holder to acquire one flow through common share of the Company
            ("Flow-Through Shares") at no additional cost. The term
            "Flow-Through Shares" is significant for tax purposes in Canada
            because it enables the issuer to allocate certain exploration tax
            credit to the holders of such shares. The FT Special Warrants may be
            exercised at any time but will automatically be exercised on the
            earlier of: (i) the FT Qualification Time (as defined below), or
            (ii) the date which is 181 days from the date of the Special Warrant
            Certificate (December 30, 2005), or such later date as may be agreed
            upon between the Company and holder of the FT Special Warrants (the
            "FT Expiry Time"). All FT Special Warrants will be automatically
            exercised without any further action by the holder at 4:30 p.m.
            (Toronto time) on the earlier of: (i) the fifth business day after
            the date upon which a registration statement to be filed by the
            Company under the Securities Act has been declared effective by the
            SEC with respect to the distribution of the Flow-Through Shares
            issuable upon exercise of the FT Special Warrants (the "FT
            Qualification Time") or (ii) the FT Expiry Time. The Company has
            undertaken to use its reasonable best efforts to file a registration
            statement with the SEC to qualify the Flow-Through Shares to become
            effective on or before 180 days after December 30, 2005, the date of
            the closing of the FT Special Warrant sale.

            Since all Canadian Exploration expenses are incurred by the
            Company's 100% owned Canadian subsidiary, which conducts mining
            explorations in the Yukon Territory of Canada, for Canadian tax
            purposes, a similar Flow-Through subscription agreement was executed
            between the Company and its 100% Canadian subsidiary. The effective
            date of renunciation for Canadian Exploration expenses is December
            31, 2005, which as per Canadian tax regulations requires the
            Canadian subsidiary to incur eligible Canadian exploration expenses
            for the entire subscription amount of $180,000 (CDN$205,020) on or
            before December 31, 2006.

      8. CONVERTIBLE PROMISSORY NOTES

            (a) On October 6, 2004 the Company borrowed $43,750 from two
            accredited investors and issued convertible promissory notes. The
            notes bear interest at 2% per annum. The notes are convertible on
            their maturity, which is one year and 7 days from the date of issue
            at the option of the holder. The notes if converted are convertible
            at the rate of $0.75 for one common share and one half share
            purchase warrant. Each full warrant entitles the holder to purchase
            one share of common stock for $1.25 per share on or before June 30,
            2006. The two accredited investors converted their promissory notes
            on October 18 and 24, 2005 and the company issued a total of 59,547
            common shares and 29,167 warrants covering the principal amount of
            $43,750 and interest in the amount of $910 in accordance with the
            conversion provisions of the notes. The expiry date of the warrants
            was extended to 15 months after the conversion date.


<PAGE>


YUKON GOLD CORPORATION, INC.
(AN EXPLORATION STAGE COMPANY)
CONDENSED NOTES TO INTERIM CONSOLIDATED FINANCIAL STATEMENTS
JANUARY 31, 2006
(AMOUNTS EXPRESSED IN US DOLLARS)
(UNAUDITED)


      8. CONVERTIBLE PROMISSORY NOTES - CON'T

            (b) On November 2, 2004 the Company borrowed $56,250 from one
            accredited investor and issued a convertible promissory note. The
            note bears interest at 2% per annum. The note is convertible on its
            maturity, which is one year and 7 days from the date of issue at the
            option of the holder. The note if converted is convertible at the
            rate of $0.75 for one common share and one half share purchase
            warrant. Each full warrant entitles the holder to purchase one share
            of common stock for $1.25 per share on or before June 30, 2006. The
            expiry date of the warrants was extended to 15 months after the
            conversion date. The investor converted the promissory note on
            November 9, 2005, and the company issued a total of 76,525 common
            shares and 37,500 warrants covering the principal amount of $56,250
            and interest in the amount of $1,143 in accordance with the
            conversion provisions of the note.

            (c) On November 30, 2004 the Company borrowed $25,500 from one
            accredited investor and issued two convertible promissory notes in
            the amounts of $20,000 and $5,500. The notes bear interest at 2% per
            annum. The notes are convertible on their maturity, which is one
            year and 7 days from the date of issue at the option of the holder.
            The notes if converted are convertible at the rate of $0.75 for one
            common share and one half share purchase warrant. Each full warrant
            entitles the holder to purchase one share of common stock for $1.25
            per share on or before June 30, 2006. The expiry date of the
            warrants was extended to 15 months after the conversion date. The
            investor converted both these promissory notes on December 7, 2005
            and the company issued an aggregate of 34,306 common shares and
            17,001 warrants covering the principal amount of $25,500 and
            interest in the amount of $409 in accordance with the conversion
            provision of the notes.

            (d) On January 4, 2005 the Company borrowed $75,000 from an
            accredited investor, and issued a convertible promissory note. The
            note bears interest at 2% per annum. The note is convertible on its
            maturity, which is one year and 7 days from the date of issue at the
            option of the holder. The note if converted is convertible at the
            rate of $0.75 for one common share and one half share purchase
            warrant. Each full warrant entitles the holder to purchase one share
            of common stock for $1.25 per share on or before June 30, 2006. The
            expiry date of the warrants was extended to 15 months after the
            conversion date. The investor converted the promissory note on
            January 11, 2006 and the company issued a total of 101,150 common
            shares and 50,000 warrants covering the principal amount of $75,000
            and interest in the amount of $1,533 in accordance with the
            conversion provisions of the notes.

      9. STOCK OPTIONS

            On June 28, 2005 the board of directors granted options to its two
            new directors to acquire 250,000 shares each, to vest at the rate of
            1/24 per month for a term of two (2) years. The exercise price was
            set at $0.55 per share based on the closing share price on July 5,
            2005.

            On September 26, 2005 the board of directors with agreement with the
            consultant, reduced the number of options granted to the consultant
            from 75,000 to 20,000. The exercise price was set at $0.58 per share
            based on the closing price on August 16, 2005 and the options expire
            on April 15, 2008.

            On December 13, 2005 the board of directors granted options to its
            two new directors to acquire 250,000 shares each, to one officer to
            acquire 250,000 shares, to one officer to acquire 200,000 shares and
            to one officer to acquire 76,000 shares. The exercise price for all
            1,026,000 options was set at $1.19 per share based on the closing
            share price on December 13, 2005. These options vest at the rate of
            1/24 per month for a term of two (2) years.

            On January 17, 2006 the board of directors granted options to a
            consultant to acquire 88,000 shares, to vest at the rate of 1/24 per
            month for a term of two (2) years. The exercise price was set at
            $1.19 per share based on the closing price on December 13, 2005.

            On January 20, 2006 the board of directors granted options to a
            director to acquire 150,000 shares, to vest at the rate of 1/24 per
            month for a term of two (2) years. The exercise price was set at
            $0.85 per share based on closing price on January 20 2006.


<PAGE>


YUKON GOLD CORPORATION, INC.
(AN EXPLORATION STAGE COMPANY)
CONDENSED NOTES TO INTERIM CONSOLIDATED FINANCIAL STATEMENTS
JANUARY 31, 2006
(AMOUNTS EXPRESSED IN US DOLLARS)
(UNAUDITED)


      9. STOCK OPTIONS - CON'T

            The Company has adopted SFAS No. 123, Accounting for Stock-Based
            Compensation, as amended by SFAS No. 148 which introduced the use of
            a fair value-based method of accounting for stock-based
            compensation. It encourages, but does not require, companies to
            recognize compensation expenses for stock-based compensation to
            employees based on the new fair value accounting rules. Accordingly,
            compensation cost for stock options is measured as the excess, if
            any, of the quoted market price of the Company's stock at the
            measurement date over the amount an employee must pay to acquire the
            stock. The Company has adopted SFAS123 (Revised) in the first
            quarter of 2006.

            For this nine month period ended January 31, 2006, the Company has
            recognized in the financial statements, stock-based compensation
            costs as per the following details. The fair value of each option
            used for the purpose of estimating the stock compensation is based
            on the grant date using the Black-Scholes option pricing model with
            the following weighted average assumptions:

<TABLE>
<CAPTION>
                                    June      August    December   January    January
                                  28, 2005   16, 2005   13, 2005   17, 2006   20, 2006     Total
                                  --------   --------   --------   --------   --------   --------
<S>                               <C>        <C>        <C>        <C>        <C>        <C>
Risk free rate                         3.0%       3.0%      3.25%      3.25%      3.25%
Volatilityfactor                     60.12%     54.27%     87.72%     93.47%     90.83%
Expected dividends                     nil        nil        nil        nil        nil
Stock-based compensation
   cost expensed for nine months
    ended January 31, 2006        $ 95,840   $  4,260   $ 39,193   $    630        nil   $139,923
Unexpended stock-based
   compensation deferred over
   the vesting period                                   $548,704     30,894   $ 63,170   $642,768
</TABLE>


            Regarding stock options granted on December 13, 2005, January 17,
            2006 and January 20, 2006, the deferred stock-based compensation
            cost of $ 642,768 will be expensed equally over the respective two
            year vesting period.


                                       10
<PAGE>


YUKON GOLD CORPORATION, INC.
(AN EXPLORATION STAGE COMPANY)
CONDENSED NOTES TO INTERIM CONSOLIDATED FINANCIAL STATEMENTS
JANUARY 31, 2006
(AMOUNTS EXPRESSED IN US DOLLARS)
(UNAUDITED)

      10. RESTRICTED CASH

            Under Canadian income tax regulations, a company is permitted to
            issue flow-through shares whereby the company agrees to incur
            qualifying expenditures and renounce the related income tax
            deductions to the investors. Notwithstanding, that there is no
            specific requirement to segregate the funds, the flow-through funds
            which are unexpended at the consolidated balance sheet date are
            considered to be restricted and are not considered to be cash or
            cash equivalents. As of January 31, 2006, unexpended flow-through
            funds were $169,465 (CDN $193,020).

      11. INCOME TAXES

            The Company did not record any recovery for income taxes for the
            period ended January 31, 2006 as the net loss carry forwards are
            fully offset by a valuation allowance.

      12. GENERAL & ADMINISTRATION EXPENSES

            Included under general and administration expense for the three and
            nine month period ended January 31, 2006, is the accrual to a
            consultant for severance cost of $181,610(CDN $206,855). This amount
            is payable to the outgoing consultant within five business days of
            the TSX listing becoming effective and will be paid from the funds
            successfully raised (refer to subsequent event note).

      13. PROPERTY PLANT & EQUIPMENT

            Included under Property Plant & Equipment is office furniture and
            equipment purchased from the outgoing consultant for $19,315 (CDN $
            22,000). This amount is payable to the outgoing consultant within
            five business days of the TSX listing becoming effective and shall
            be paid from the funds successfully raised (refer to subsequent
            event note).

      14. SUBSEQUENT EVENTS

            Subsequent to January 31, 2006, the Company received the balance
            outstanding of $1,500 relating to the promissory note for the issue
            of 150,000 common shares and 150,000 share purchase warrants on
            December 5, 2005. This promissory note and share issuance is
            described above in Note 6 - ISSUANCE OF COMMON SHARES AND WARRANTS.

            The Company entered into an agreement with a placement agent, to
            place up to $3.0 million of its securities in Canada. Under this
            agreement, the placement agent would receive a cash payment equal to
            9% of the gross proceeds of the private placement plus warrants
            equal to 10% of such gross proceeds.

            Subsequent to January 31, 2006, the Company applied for a Toronto
            Stock Exchange listing.

            On January 17, 2006, the Company's Board accepted the resignation of
            Warren Holmes in his capacity as CEO. Mr. Holmes will continue to
            sit on the Board as Chairman. There were no disagreements between
            the Company and Mr. Holmes with respect to the Company's operations,
            policies or practices.

            Also on January 17, 2006, the Company's Board accepted the
            resignation of Brian Robertson in his capacity as President. Mr.
            Robertson stated that his resignation is due to other commitments
            and that he could no longer serve the Company. There were no
            disagreements between the Company and Mr. Robertson with respect to
            the Company's operations, polices or practices.


<PAGE>


YUKON GOLD CORPORATION, INC.
(AN EXPLORATION STAGE COMPANY)
CONDENSED NOTES TO INTERIM CONSOLIDATED FINANCIAL STATEMENTS
JANUARY 31, 2006
(AMOUNTS EXPRESSED IN US DOLLARS)
(UNAUDITED)


      14. SUBSEQUENT EVENTS - CON'T

           On January 17, 2006, the Board appointed Kenneth Hill as CEO to fill
           the vacancy left by Mr. Holmes. Mr. Hill was also appointed as
           President to fill the vacancy left by Mr. Robertson. Mr. Hill is the
           founder of ProMin Consulting Associates Inc., a Canadian company
           that provides independent consulting and project management services
           to the global minerals industry. Prior to his involvement with
           ProMin Consulting Associates Inc., Mr. Hill held senior positions
           involving mine design, mine development and mine operations with
           Inmet Mining Corp., Northgate Exploration Ltd., Dome Mines Ltd. (now
           Placer Dome Inc.) and J.S. Redpath Ltd. Mr. Hill is a registered
           professional engineer and graduated with a degree in Geological
           Engineering from the Michigan Technological University. He also
           holds a degree in Mining Technology from the Haileybury School of
           Mines. Mr. Hill has over forty years of experience in the mining
           industry and has been a director of the Company since December 15,
           2004.


                                       11


<PAGE>


                     MANAGEMENT'S DISCUSSION AND ANALYSIS OF
                  FINANCIAL CONDITION AND RESULTS OF OPERATION
           FOR THE THREE AND NINE MONTH PERIODS ENDED JANUARY 31, 2006

FORWARD-LOOKING STATEMENTS
--------------------------

The statements contained in this report on Form 10QSB which are not historical
facts may contain forward-looking statements that are subject to important
factors that could cause actual results to differ materially from those in the
forward-looking statement, including the factors set forth in RISK FACTORS
below, and other public record material available on the SEC EDGAR system. The
Company does not undertake to update any forward-looking statement that may be
made from time to time by or on its behalf.

OVERVIEW
--------

The following discussion and analysis is intended to help you understand the
Company's financial condition and results of operations for the three months and
nine months ended January 31, 2006. You should read the following discussion and
analysis together with the Company's audited financial statements and the notes
to the financial statements for the year ended April 30, 2005. The Company's
planned principal activities have not yet produced revenues and the Company has
suffered recurring operating losses. The Company expects these operating losses
to continue for so long as the Company remains in an exploration stage, and
thereafter until the Company establishes a profitable mining operation. As at
January 31, 2006, the Company had accumulated losses of $3,026,202. These losses
raise substantial doubt about the Company's ability to continue as a going
concern. The Company's ability to emerge from the exploration stage and conduct
mining operations is dependent in large part upon the Company raising additional
equity or debt financing; receiving funding from related parties and
shareholders; and the future market for the minerals, which may be located in
the Company's mineral claims.

DESCRIPTION OF BUSINESS
-----------------------

Yukon Gold Corporation, Inc. (the "Company") is an exploration stage mining
company. The Company's objective is to acquire advanced projects with known
resources and mineral claims that warrant exploration for potential resources.
At present all operations are carried on through the Company's wholly owned
subsidiary Yukon Gold Corp. ("YGC") which holds a substantial mineral claim
position in the Mayo Mining District of the Yukon Territory, Canada. These
mineral claims are in two separate and distinct groups that are referred to
herein as the Marg Property and the Mount Hinton Property which are located
within 20 miles of each other. There is no assurance that the mineral resource
on the Marg Property can be economically developed or that a commercially viable
mineral resource exists on the Mount Hinton Property. Further exploration and
development will be required before a final evaluation of the economics and
feasibility of these properties is determined. There are current National
Instrument 43-101 reports describing both properties available on the Company's
Web site at www.yukongoldcorp.com.

If the Company is successful in demonstrating the economic feasibility of these
properties, it envisions a central milling facility that would be capable of
servicing both projects and possibly other projects in the area. The Company
plans to continue to seek out opportunities for other acquisitions in the area.

THE MARG PROPERTY
-----------------

In March 2005, the Company acquired rights to purchase 100% of the Marg Property
which consists of 402 contiguous mineral claims covering approximately 20,000
acres located in the Mayo Mining District of the Yukon Territory of Canada.
Title to the claims is registered in the name of YGC.

The Company assumed the rights to acquire the Marg Property under a Property
Purchase Agreement ("Agreement") with Atna Resources Ltd. ("Atna"). Under the
terms of the Agreement the Company paid $119,189 (CDN$150,000) cash and 133,333
common shares as a down payment. The Company made payments under the Agreement
for $43,406 (CDN$50,000) cash and an additional 133,333 common shares of the
Company on December 12, 2005.

The Company has agreed to make subsequent payments under the Agreement of:
(i) $87,796 (CDN$100,000) cash and an additional 133,334 common shares of the
Company on or before December 12, 2006; (ii) $87,796 (CDN$100,000) cash on or
before December 12, 2007; and (iii) $175,592 (CDN$200,000) in cash and/or common
shares of the Company (or some combination thereof to be determined) on or
before December 12, 2008. Upon the commencement of commercial production at the
Marg Property, the Company will pay to Atna $877,960 (CDN$1,000,000) in cash
and/or common shares of the Company, or some combination thereof to be
determined.


<PAGE>


DESCRIPTION
-----------

The Marg resource consists of a series of continuous to discontinuous sheets of
massive and semi-massive sulphide mineralization. Up to eight sulphide sheets
can occur on a single section although most of the mineralization occurs within
four sheets (Zones A-D). The resource classified in accordance with NI 43-101 is
stated in the table below:

<TABLE>
<CAPTION>
---------- --------------- --------------------------- ----------- ------------ ---------- --------- ----------- -----------
<S>        <C>             <C>                         <C>         <C>          <C>        <C>       <C>         <C>
  ZONE     CLASSIFICATION    AVERAGE THICKNESS (M)       TONNES      COPPER%     LEAD %     ZINC %   SILVER G/T   GOLD G/T
---------- --------------- --------------------------- ----------- ------------ ---------- --------- ----------- -----------
A          Indicated       4.8m                        57,605      1.93         3.56       6.33      105.14      1.93
---------- --------------- --------------------------- ----------- ------------ ---------- --------- ----------- -----------
           Inferred                                    75, 413     0.68         0.96       2.10      35.22       0.45
---------- --------------- --------------------------- ----------- ------------ ---------- --------- ----------- -----------
B          Indicated       3.7m                        785,497     1.70         2.21       4.08      61.90       0.90
---------- --------------- --------------------------- ----------- ------------ ---------- --------- ----------- -----------
           Inferred                                    80,548      1.46         2.22       4.34      53.29       0.87
---------- --------------- --------------------------- ----------- ------------ ---------- --------- ----------- -----------
C          Indicated       8.6m                        1,459,564   1.60         2.45       4.31      73.41       1.21
---------- --------------- --------------------------- ----------- ------------ ---------- --------- ----------- -----------
           Inferred                                    289,330     1.90         2.10       3.95      60.04       1.26
---------- --------------- --------------------------- ----------- ------------ ---------- --------- ----------- -----------
D          Indicated       5.1m                        2,343,521   1.95         2.75       5.26      59.97       0.85
---------- --------------- --------------------------- ----------- ------------ ---------- --------- ----------- -----------
           Inferred                                    435,488     1.48         1.88       3.80      46.12       0.85
---------- --------------- --------------------------- ----------- ------------ ---------- --------- ----------- -----------

---------- --------------- --------------------------- ----------- ------------ ---------- --------- ----------- -----------
TOTAL      INDICATED       6.0M                        4,646,200   1.80         2.57       4.77      65.08       0.99
---------- --------------- --------------------------- ----------- ------------ ---------- --------- ----------- -----------
TOTAL      INFERRED        6.0M                        880,800     1.55         1.90       3.75      50.42       0.95
---------- --------------- --------------------------- ----------- ------------ ---------- --------- ----------- -----------
</TABLE>


It is estimated that an additional 15-18 drill holes would be required to
upgrade the inferred resources to the indicated category. It is highly probable
that these holes would also increase the overall size of the deposit.

RESULTS
-------

The four massive sulphide zones have been termed `A' through `D' with `A' being
the footwall or lowermost zone and `D' being the hangingwall or uppermost zone.
Tonnage and grades for selected polygons have been compiled by zone.

Zone `A' is a discontinuous band of mineralization that has been traced over a
1,200 metre strike length by 17 drill intercepts. Length weighted average grades
for these intercepts are 0.90% Cu, 1.43% Pb, 2.81% Zn, 40.6 g/t Ag and 0.50 g/t
Au over 2.8m. Only 6 polygons meet the requirements to be included in the
resource estimate and when a CNSR $40 cut-off grade is applied, only two
polygons are included.

Zone `B' is 800 m long and is defined by 32 drill intercepts averaging 1.41% Cu,
1.92% Pb, 3.70% Zn, 53.9 g/t Ag, and 0.69 g/t Au over a 2.5 m thickness. The
eastern lobe of this crescent shaped horizon displays good continuity, at least
relative to the underlying `A' zone, for some 600 metres. Application of the
thickness, grade and continuity constraints results in only 12 of the
intersection polygons contributing to the resource estimate.

Zone `C' extends for 1,100 m along strike and up to 500 m in the down-dip
direction with 34 drill intercepts averaging 1.40% Cu, 2.33% Pb, 3.85% Zn, 53.0
g/t Ag and 1.08 g/t Au over 4.5 metres. Some anomalous thicknesses, up to 22.9
m, and elevated precious metal contents distinguish this zone from the others.
Drill-hole 88-02 contains 319 g/t Ag and 1.71 g/t Au which are highly anomalous.
Because this hole is very close to surface the high precious metal contents
could be due to supergene enrichment or to oxidation of the sulphide minerals
and loss of Fe and S and corresponding mass loss as suggested by very low copper
and zinc values (0.26 and 0.02, respectively). Seventeen of the 34 polygons
exceed the grade, thickness and continuity criteria and comprise 4 separate
zones, although 3 zones are semi-continuous. One polygon in this zone accounts
for nearly 25% of the contained tonnes and therefore tends to skew the average
thickness upwards.

Zone `D' is the most continuous of the zones and extends for 1,200 m along
strike and up to 650 m in the down-dip direction. There are 52 drill intercepts
with an average grade of 1.87% Cu, 2.55% Pb, 4.67% Zn, 45.8 g/t Ag, and 0.87 g/t
Au. Of the 52 intercepts, 32 polygons met the selection criteria and form a
nearly continuous zone 600 m long and 300 m down-dip with only a few outliers.
This zone contains 50.3% of the total estimated resource and remains open to
expansion.

Exploration potential within the Marg property is high. Recognition of the
structural style of the sheath folds allows the prediction of the location of
prospective stratigraphy in the sub-surface. Mapping and prospecting have
discovered structural repetitions of the volcanogenic massive sulphide host
stratigraphy that contain sulphide occurrences, such as the Leyla zone, which
highlight the potential for discovery of new zones of massive sulphide
mineralization. The previously discovered Jane zone, (on the Marg Property) is
hosted by the strike extension of the Marg deposit host rocks, and thickness of
the volcanic package and the intensity of alteration appears to be significantly
greater than that present in the Marg area, presenting a very attractive
exploration target. The deposit remains open to expansion along its edges and
drilling to upgrade the inferred part of the resource has potential to expand
the deposit size. The tendency for volcanogenic massive sulphide deposits to
cluster, as well as potential for structural repetitions, suggests that the rock
sequence hosting the Marg deposit remains highly prospective down-dip and to the
west. Deep penetration geophysics or bore-hole geophysics could play a
significant role in exploring this favorable stratigraphy.


<PAGE>


The Company completed a four (4) hole drill program on the property in early
December 2005 designed to upgrade inferred mineralization to drill indicated
resources as well as finding new extensions of the main "D" zone at depth. All
four (4) holes intercepted the targeted zone and averaged 2.39% Cu, 2.49% Pb,
5.23% Zn, 0.73 g/t Ag, and 55 g/t Au over an average width of 3.6 meters.

THE MOUNT HINTON PROPERTY
-------------------------

On July 7, 2002 YGC entered into an option agreement with the Hinton Syndicate
to acquire a 75% interest in the 273 unpatented mineral claims covering
approximately 14,000 acres in the Mayo Mining District of the Yukon Territory,
Canada. This agreement was replaced with a revised and amended agreement (the
"Hinton Option Agreement") dated July 7, 2005, which superseded the original
agreement and amendments thereto. The new agreement is between the Company, its
wholly owned subsidiary YGC and the Hinton Syndicate.

YGC must make scheduled cash payments and perform certain work commitments to
earn up to a 75% interest in the mineral claims, subject to a 2% net smelter
return royalty in favor of the Hinton Syndicate, as further described below.
The schedule of Property Payments and Work Programs are as follows:


           PROPERTY PAYMENTS
           -----------------

           On execution of the
            July 7, 2002 Agreement           $   19,693  (CDN  $   25,000) Paid

           On July 7, 2003                   $   59,078  (CDN  $   75,000) Paid

           On July 7, 2004                   $  118,157  (CDN  $  150,000) Paid

           On January 2, 2006                $  125,313  (CDN  $  150,000) Paid

           On July 7, 2006                   $  131,694  (CDN  $  150,000)

           On July 7, 2007                   $  131,694  (CDN  $  150,000)

           On July 7, 2008                   $  131,694  (CDN  $  150,000)

                                    TOTAL    $  717,323  (CDN  $  850,000)

           WORK PROGRAM-EXPENDITURES TO BE INCURRED IN THE FOLLOWING PERIODS;
           -----------------------------------------------------------------

           July 7/02 to July 6/03            $  118,157  (CDN  $  150,000)
                                                                 Incurred

           July 7/03 to July 6/04            $  196,928  (CDN  $  250,000)
                                                                 Incurred

           July 7/04 to July 6/05            $  256,006  (CDN  $  325,000)
                                                                 Incurred

           July 7/05 to Dec. 31/06           $  658,472  (CDN  $  750,000)

           Jan. 1/07 to Dec. 31/07           $  877,963  (CDN  $1,000,000)

           Jan. 1/08 to Dec. 31/08           $1,097,454  (CDN  $1,250,000)

           Jan.  1/09 to Dec. 31/09          $1,316,945  (CDN  $1,500,000)

                                    TOTAL    $4,521,925  (CDN  $5,225,000)

           Provided all Property Payments have been made that are due prior to
           the Work Program expenditure levels being attained, YGC shall have
           earned a:

                  25% interest upon Work Program expenditures of $1,316,945
                     (CDN$1,500,000)

                  50% interest upon Work Program expenditures of $2,194,908
                     (CDN$2,500,000)

                  75% interest upon Work Program expenditures of $4,521,925
                     (CDN$5,225,000)


           In some cases, payments made to service providers include amounts
           advanced to cover the cost of future work. These advances are not
           loans but are considered "incurred" exploration expenses under the
           terms of the Hinton Option Agreement. Section 2.2(a) of the Hinton
           Option Agreement defines the term, "incurred" as follows: "Costs
           shall be deemed to have been "incurred" when YGC has contractually
           obligated itself to pay for such costs or such costs have been paid,
           whichever should first occur." Consequently, the term, "incurred"
           includes amounts actually paid and amounts that YGC has obligated
           itself to pay. Under the Hinton Option Agreement there is also a
           provision that YGC must have raised and have available the Work
           Program funds for the period from July 7, 2005 to December 31, 2006,
           by May 15 of 2006.

           The Hinton Option Agreement contemplates that upon the earlier of:
           (i) a production decision or (ii) investment of $4,521,925
           (CDN$5,225,000) or (iii) YGC has a minority interest and decides not
           to spend any more money on the project, YGC's relationship with the
           Hinton Syndicate will become a joint venture for the further
           development of the property. Under the terms of the Hinton Option
           Agreement, the party with the majority interest would control the
           joint venture. Once the 75% interest is earned, as described above,
           YGC has a further option to acquire the remaining 25% interest in the
           mineral claims for a further payment of $4,389,816 (CDN$5,000,000).


<PAGE>


           The Hinton Option Agreement provides that the Hinton Syndicate
           receive a 2% "net smelter return royalty." In the event that the
           Company exercises its option to buy-out the remaining 25% interest of
           the Hinton Syndicate (which is only possible if the Company has
           reached a 75% interest, as described above) then the "net smelter
           return royalty" would become 3% and the Hinton Syndicate would retain
           this royalty interest only. The "net smelter return royalty" is a
           percentage of the gross revenue received from the sale of the ore
           produced from the mine less certain permitted expenses.

The Hinton Option Agreement entitles the Hinton Syndicate to recommend for
appointment one member to the board of directors of the Company.

The Hinton Option Agreement provides both parties (YGC and Hinton Syndicate)
with rights of first refusal in the event that either party desires to sell or
transfer its interest.

The Hinton Syndicate members, each has the option to receive their share of
property payments in stock of the Company at a 10% discount to the market and
once the Company has obtained a listing on a Canadian stock exchange YGC and the
Company have a further option to pay 40% of any property payment due after the
payment on January 2, 2006 with common stock of the Company.

The Hinton Property is located approximately 6 miles southeast of Keno City and
150 north of Whitehorse within the Tombstone Gold Belt.

DESCRIPTION
-----------

The Mount Hinton Property is located within the Tombstone Gold Belt immediately
to the east of the Keno-Elsa Silver Camp. Recognized as one of the more
prospective gold regions in the world, the Tombstone Gold Belt is comprised of
several mineral rich districts that extend more than 1000 km across the North
American Cordillera (Alaska and Yukon). Though mineralization types vary they
are all related to a distinctive northwest trending belt of plutonic intrusions
termed the Tombstone Suite.

The Mt. Hinton gold veins and silver deposits of the Keno Hill Silver Camp occur
within the Keno Hill Quartzite where brittle failure has created major fracture
zones for mineral deposition. The brittle quartzite represents a tectonic sheet
or bed separated by two major faults called the Tombstone and Robert Service
thrusts. The Keno Hill Quartzite is 600 metres thick in the silver zones and as
much as 2000 metres thick on the Mount Hinton Property.

Economic silver deposits in the Keno Hill are best developed within the
relatively brittle Keno Hill Quartzite. Within productive areas the ore zones
occur throughout the full quartzite bed from hanging wall to footwall. Strike
lengths of individual ore shoots range from 30 to 335 metres, with thicknesses
ranging from 0.3 to 30 metres. The Mount Hinton Property gold zones mirror the
physical characteristics of the Keno Hill silver zones although they are much
more enriched in gold.

Over 50 mineralized gold veins, vein segments and float trains have been
identified on the Mount Hinton Property. These veins form a broad vein fault
system, (Mt. Hinton Gold Trend), 300 metres wide and 3000 metres long. To date
gold mineralization has been found over a vertical distance of 426 metres. The
extent of this system may encompass the entire lateral and vertical extent of
the Keno Hill Quartzite bound by the Tombstone and Robert Service thrust faults.
From footwall to hanging wall the relatively shallow dipping quartzite unit
represents better then 2000 metres of thickness and 8000 metres of strike length
where it is intersected by the Mt. Hinton vein fault system. Parallel vein fault
systems may also be present.

The two strongest veins, the 19 and 52 vein systems represent the key target
area. The 19 vein has been traced through mapping, trenching and a defined air
photo lineament for 366 metres. Current exploration has extended the 52 vein for
1000 metres. Geochemical sampling has outlined a highly anomalous gold and
pathfinder element anomaly representing the projected westerly strike of the 52
Vein.

Gold and silver mineralization occurs within quartz veins as well as clay-rich
fault gouge zones that bound the veins. These clay-rich zones were never
historically sampled by previous operators whereas recent sampling by the
Company has shown that significant gold and silver values may be present across
the entire vein structures and, therefore, relatively well developed precious
metal mineralization may be present over greater widths than previously thought.
Grab samples of 52 Vein material exposed intermittently by hand trenching and
machine trenching on a steep north facing slope assayed up to 6.0 g/t Au with
2350 g/t Ag and 127.5 g/t Au with 1575 g/t Ag and a 1.30 m channel sample ran
9.0 g/t Au with 39.0 g/t Ag. Results of 2003 and 2004 exploration on the Mount
Hinton Property suggest that the 52 vein system may be well-mineralized with
significant gold and silver mineralization along its entire strike length.


<PAGE>


Other veins of merit within the same area are:

      o     21 vein, weighted average of samples over a 22 metre strike length
            ran 42.5 g/t Au and 319 g/t Ag over average width of 105 cm.

      o     35 vein, weighted average of samples over a 6.1 metre strike length
            ran 16.80 g/t Au and 614 g/t Ag over average width of 183 cm.

These individual veins delineate continuous gold mineralization over the
distances sampled and sampling was terminated because of talus thicknesses.

The two bulk metallurgical samples taken from the 15 and 21 veins by United Keno
Hill Mines Ltd. in 1967/68 returned head grades of 50.88 g/t Au, 144.96 g/t Ag
and 72.32 g/t Au, 659.2 g/t Ag respectively. The geological and structural model
developed from 100 years of mining similar structures in the Keno area,
demonstrates the potential for continuity of gold mineralization in the Mt.
Hinton trend. There is a very high probability of locating economic gold lenses
of such grade that direct shipping is possible. All attempts to further
delineate the ore shoots contained within the system have been thwarted by
coarse talus, permafrost, steep terrain and the difficulty in sampling clay
mineralization. Because of the physical setting of the known veins, the most
cost effective way to test the Mt. Hinton trend is via underground development.


DISCUSSION OF OPERATIONS & FINANCIAL CONDITION
FOR THE THREE AND NINE MONTHS ENDED JANUARY 31, 2006

REVENUES

No revenue was generated by the Company's operations during the three and
nine-month periods ended January 31, 2006 and January 31, 2005.

EXPENSES

The Company's expenses are reflected in the Interim Consolidated Statements of
Operation under the category of Operating Expenses. To meet the criteria of
United States generally accepted accounting principles ("GAAP"), all exploration
and general and administrative costs related to projects are charged to
operations in the year incurred.

The most significant component of expense which has contributed to the total
operating expense is project expense, representing approximately 52 % of the
total operating expense for the nine-month period ended January 31, 2006, and
approximately 55% of the total operating expense ( net of exploration tax
credit) for the nine-month period ended January 31, 2005. Project expenses for
the three-month period ended January 31, 2006 were approximately 59% of total
operating expense as compared to approximately 14% for the three-month period
ended January 31, 2005. Included in the project expense for the three month
ended January 31, 2006 was the issuance of 133,333 common shares in the amount
of $100,000 for property payment to Atna Resources Ltd., along with a cash
payment of $43,406 (CDN$50,000) as per terms of the agreement. This entire
payment of $143,406 was expensed to project expenses in the consolidated
financial statements. Net loss during the nine-month period ended January 31,
2006 increased by $1,214,929 over the corresponding period of the prior year.
However, for the three-month period ended January 31, 2006, our net loss was
$1,028,400 as compared to our net loss of $97,642 for the same period in the
prior year. For the three-month period ended January 31, 2006 the company
incurred capital expenditure for $19,315 (CDN$22,000), being purchase of office
furniture and equipment from an outgoing consultant.

CHANGES IN SENIOR MANAGEMENT

On January 17, 2006, the Company's Board accepted the resignation of Warren
Holmes in his capacity as CEO. Mr. Holmes will continue to sit on the Board as
Chairman. There were no disagreements between the Company and Mr. Holmes with
respect to the Company's operations, policies or practices.

 Also on January 17, 2006, the Company's Board accepted the resignation of Brian
Robertson in his capacity as President. Mr. Robertson stated that his
resignation is due to other commitments and that he could no longer serve the
Company. There were no disagreements between the Company and Mr. Robertson with
respect to the Company's operations, policies or practices.

On January 17, 2006 the Board appointed Kenneth Hill as CEO to fill the vacancy
left by Mr. Holmes. Mr. Hill was also appointed as President to fill the vacancy
left by Mr. Robertson. Mr. Hill is the founder of ProMin Consulting Associates
Inc., a Canadian company that provides independent consulting and project
management services to the global minerals industry. Prior to his involvement
with ProMin Consulting Associates Inc., Mr. Hill held senior positions involving
mine design, mine development and mine operations with Inmet Mining Corp.,
Northgate Exploration Ltd., Dome Mines Ltd. (now Placer Dome Inc.) and J.S.
Redpath Ltd. Mr. Hill is a registered professional engineer and graduated with a
degree in Geological Engineering from the Michigan Technological University. He
also holds a degree in Mining Technology from the Haileybury School of Mines.
Mr. Hill has over forty years of experience in the mining industry and has been
a director of the Company since December 15, 2004.


<PAGE>


LIQUIDITY AND CAPITAL RESOURCES

Three months ended January 31, 2006
-----------------------------------

On August 25, 2005 the Company entered into a Consulting Agreement with Endeavor
Holdings, Inc. (Endeavor) of New York, New York to assist the Company in raising
capital. Under the terms of this agreement the Company agreed to pay Endeavor
150,000 common shares at the rate of 25,000 shares per month. Either party may
cancel the agreement on 30 days notice. As of October 31, 2005 the Company had
issued 75,000 common shares valued at $65,250, to Endeavor. As of the three
months ended January 31, 2006 the Company had issued the final 75,000 common
shares valued at $65,250.

On October 18, 2005 the Company authorized the issuance of 14,000 common shares
for the exercise of 14,000 warrants from a warrant holder in consideration of
$12,000.

On October 18 and 24, 2005, the Company issued a total of 59,547 common shares
and 29,167 warrants covering the principal amount of $43,750 plus interest of
$910 in accordance with the conversion provision of the note of $43,750 received
from two accredited investors on October 6, 2004.

On November 9, 2005, one accredited investor converted the promissory note on
its due date and the company issued 76,525 common shares and 37,500 warrants
covering the principal amount of $56,250 and interest in the amount of $1,143 in
accordance with the conversion provisions of the notes. The expiry date of the
warrants was extended to 15 months after the conversion date.

On December 5, 2005, the Company authorized the issuance of 150,000 common
shares and 150,000 warrants to one accredited investor in consideration of
$151,500, payable by delivery of $100,000 in cash and a promissory note in the
principal amount of $51,500 due on January 15, 2006. Each common share was
valued at $1.00 per share and each warrant at $0.01. Each warrant entitles the
holder to purchase one common share at a purchase price of $1.00 per share on or
before December 4, 2006. As of January 31, 2006, $1,500 of the amount to be
advanced to the Company against the promissory note was still outstanding. This
amount was subsequently paid by the investor.

Also on December 5, 2005, the board of directors authorized the issuance of a
total of 34,389 common shares and 17,001 warrants to one accredited investor in
settlement of two convertible promissory notes in the total principal amount of
$25,500, plus interest in the amount of $514.55. Each common share was priced at
$0.745 per share and each warrant at $0.01. Each warrant entitles the holder to
purchase one common share at a purchase price of $1.25 per share for a period of
15 months.

On December 6, 2005, the board of directors authorized the issuance of 133,333
common shares (valued at $100,000) and a cash payment of $43,406 (CND $50,000)
to Atna Resources Inc. as a "property payment" under the Marg Property
Acquisition Agreement. These common shares and the cash payment were delivered
to Atna on December 12, 2005, the due date for the payment under the Marg
Property Acquisition Agreement. This entire payment of $143,406 was expensed in
the consolidated statements of operations

On December 7, 2005 the board of directors authorized the issuance of 10,000
common shares to a shareholder for the exercise of 10,000 warrants in
consideration of $8,772 (CDN $10,000).

On December 7, 2005, an investor converted promissory notes of the Company on
their due date. The Company issued this investor, pursuant to such conversion,
34,306 common shares and 17,001 warrants covering the principal amounts of
$25,500 and interest in the amount of $409 in accordance with the conversion
provisions of the notes. The expiry date of the warrants was extended to 15
months after the conversion date.


On January 11, 2006 the accredited investor converted the promissory notes on
their due dates and the company issued 101,150 common shares and 50,000 warrants
covering the principal amounts of $75,000 and interest in the amount of $1,533
in accordance with the conversion provisions of the notes. The expiry date of
the warrants was extended to 15 months after the conversion date.

On December 15, 2005, the Company completed the sale of 400,000 Special an
accredited investor, for $404,000. Each Special Warrant entitles its holder to
acquire one common share of the Company at a purchase price of $1.00 per share
and one common share purchase warrant which entitles the holder to purchase an
additional common share at a purchase price of $0.01 per share. The Special
Warrants may not be exercised until the earlier of: (i) the Qualification Time
(as defined below), or (ii) the date which is 181 days from the closing date of
the sale of the Special Warrants (the "Expiry Time"). All Special Warrants will
be automatically exercised or deemed exercised without any further action on the
part of the holder at 4:30 p.m. (Toronto time) on the earlier of: (i) the fifth
business day after the date upon which a registration statement to be filed by
the Company under the Securities Act of 1933, as amended, has been declared
effective by the Securities and Exchange Commission with respect to the
distribution of the common shares and warrants issuable upon exercise of the
Special Warrants (the "Qualification Time") or (ii) the Expiry Time. If by 4:30
p.m. (Toronto time) on the date which is 180 days from the closing date such
registration statement has not been declared effective, the holders of Special
Warrants shall thereafter be entitled to receive, upon the exercise or deemed
exercise of the Special Warrants, 1.1 common shares and 1.1 warrants for each
Special Warrant then held by such holder (in lieu of one common share and one
warrant otherwise receivable) at no additional cost. The Company has undertaken
to use its reasonable best efforts to file a registration statement under the
Securities Act of 1933 to qualify the shares and warrants underlying the Special
Warrants with the objective of being declared effective on or before 180 days
from closing.


<PAGE>


On December 30, 2005 the Company completed the sale of 200,000 Flow-Through
Special Warrants ("FT Special Warrants") to National Bank Trust Inc. for the
account of a Canadian accredited investor, for $180,000. Each FT Special Warrant
entitles the holder to acquire one flow through common share of the Company
("Flow-Through Shares") at no additional cost. The term "Flow-Through Shares" is
significant for tax purposes in Canada because it enables the issuer to allocate
certain exploration tax credit to the holders of such shares. The FT Special
Warrants may be exercised at any time but will automatically be exercised on the
earlier of: (i) the FT Qualification Time (as defined below), or (ii) the date
which is 181 days from the date of the Special Warrant Certificate (December 30,
2005), or such later date as may be agreed upon between the Company and holder
of the FT Special Warrants (the "FT Expiry Time"). All FT Special Warrants will
be automatically exercised without any further action by the holder at 4:30 p.m.
(Toronto time) on the earlier of: (i) the fifth business day after the date upon
which a registration statement to be filed by the Company under the Securities
Act has been declared effective by the SEC with respect to the distribution of
the Flow-Through Shares issuable upon exercise of the FT Special Warrants (the
"FT Qualification Time") or (ii) the FT Expiry Time. The Company has undertaken
to use its reasonable best efforts to file a registration statement with the SEC
to qualify the Flow-Through Shares to become effective on or before 180 days
after December 30, 2005, the date of the closing of the FT Special Warrant sale.

Since all Canadian Exploration expenses are incurred by the Company's 100% owned
Canadian subsidiary, which conducts mining explorations in the Yukon Territory
of Canada, for Canadian tax purposes, a similar Flow-Through subscription
agreement was executed between the Company and its 100% Canadian subsidiary. The
effective date of renunciation for Canadian Exploration expenses is December 31,
2005, which as per Canadian tax regulations requires the Canadian subsidiary to
incur eligible Canadian exploration expenses for the entire subscription amount
of $180,000 (CDN$205,020) on or before December 31, 2006.

ACCOUNTING PRONOUNCEMENT AND POLICIES:

The Company's discussion and analysis of its financial condition and results of
operations, including the discussion on liquidity and capital resources, are
based upon its financial statements, which have been prepared in accordance with
U.S. GAAP. The preparation of these financial statements requires the Company to
make estimates and judgments that affect the reported amounts of assets,
liabilities, revenues and expenses, and related disclosure of contingent assets
and liabilities. On an ongoing basis, the Company re-evaluates its estimates and
judgments, particularly those related to the determination of the estimated
Canadian exploration tax credit receivable. Recent accounting pronouncements are
discussed in the Notes to Financial Statements contained in the Company's Annual
Report for the year ended April 30, 2005. As of January 31, 2006, the Company is
not aware of any additional pronouncements that materially affect the Company's
financial position or results of operations.

RISK FACTORS

1.      THE COMPANY HAS NO SOURCE OF OPERATING REVENUE AND EXPECTS TO INCUR
SIGNIFICANT EXPENSES BEFORE ESTABLISHING AN OPERATING COMPANY, IF IT IS ABLE TO
ESTABLISH AN OPERATING COMPANY AT ALL.

Currently, the Company has no source of revenue, minimal working capital and no
commitments to obtain additional financing. The Company does not have enough
working capital to carry out its exploration programs or to meet contractual
commitments. The Company has no operating history upon which an evaluation of
its future success or failure can be made. The ability to achieve and maintain
profitability and positive cash flow is dependent upon:

      -     raising capital to develop the Marg Property, establish a mining
            operation, and operate this mine in a profitable manner;

      -     further exploration of the Mount Hinton Property and the results of
            that exploration;

      -     raising the capital necessary to conduct this exploration and
            preserve the Company's interests in its mineral claims.

Because the Company has no operating revenue, it expects to incur operating
losses in future periods as it continues to spend funds to explore and develop
the Mount Hinton and Marg Properties. Failure to raise the necessary capital to
continue exploration and development could cause the Company to go out of
business.

2.      IF THE COMPANY DEVELOPS OTHER MINERAL RESOURCES, THERE IS NO GUARANTEE
THAT PRODUCTION WILL BE PROFITABLE.

Even if the Company finds other commercial mineral resources, there is no
assurance that it will be able to mine them or that a mining operation would be
profitable on any of its properties.


<PAGE>

3.      THE COMPANY MUST MAKE REGULAR ONGOING EXPENDITURES IN ORDER TO MAINTAIN
ITS MINERAL CLAIMS.

The Company has an option agreement (Hinton Option Agreement) with a private
syndicate, known as the Hinton Syndicate, to acquire an interest in the Mount
Hinton Property mineral claims. The agreement with the Hinton Syndicate requires
regular ongoing expenditures. If the Company fails to make these expenditures,
it will not earn an interest in these mineral claims.

The Company acquired the rights to purchase and develop the Marg Property. This
acquisition also requires the Company to make material deferred payments on
December 12 of 2006, 2007, and 2008. If the Company is unable to raise
sufficient capital to make these payments it may lose all of its rights in the
Marg Property.

4.      WEATHER INTERRUPTIONS IN THE YUKON TERRITORY MAY DELAY PROPOSED
EXPLORATION OPERATIONS.

Weather factors could significantly affect the Company's exploration efforts.
Work above ground at higher elevations on the Mount Hinton and Marg Properties
is generally limited to late May until early October of each year, depending
upon how early snowfall occurs. This could delay work on the project, increase
costs and limit the ability to meet the requirements of the agreements, which
would adversely affect the Company's ability to continue in business.

5.      THE COMPANY IS HIGHLY DEPENDENT UPON ITS OFFICERS AND DIRECTORS. BECAUSE
OF THEIR INVOLVEMENT IN OTHER SIMILAR BUSINESSES WHICH MAY BE COMPETITORS, THEY
MAY HAVE A CONFLICT OF INTEREST.

None of the Company's directors works for the Company on a full-time basis and
only two officers of the Company work for the Company on a full-time basis.
There are no proposals or definitive arrangements to engage them on a full-time
basis. They each rely on other business activities to support themselves. Four
of the directors are officers or directors of other companies in similar
exploration businesses. Such business activities may be considered a conflict of
interest because these individuals must continually make decisions on how much
of their time they will allocate to the Company as against their other business
projects, which may be competitive, or where they will allocate new business
opportunities. Also, the Company has no key man life insurance policy on any of
these individuals. The loss of one or more of these officers or directors could
adversely affect the ability to carry on business.

6.      THE COMPANY COULD ENCOUNTER REGULATORY AND PERMITTING DELAYS.

The Company could face delays in obtaining permits to operate on the property
covered by the claims. Such delays could jeopardize financing, if any is
available, in which could result in having to delay or abandon work on the Mount
Hinton and Marg Properties.

7.      GOING CONCERN QUALIFICATION

The Company has included a "going concern" qualification in its April 30, 2005
Consolidated Financial Statements to the effect that they are an exploration
stage company and have no established sources of revenue. In the event that the
Company is unable to raise additional capital and locate ore resources, as to
which there can be no assurance, it may not be able to continue operations.


DISCLOSURE AND FINANCIAL CONTROLS AND PROCEDURES

In connection with the Company's compliance with securities laws and rules, its
board of directors evaluated the Company's disclosure controls and procedures.
The board of directors has concluded that the Company's disclosure controls and
procedures are effective. There have been no significant changes in these
controls or in other factors that could significantly affect these controls
subsequent to the date of their evaluation, including any corrective actions
with regard to significant deficiencies and material weaknesses.

Internal financial controls and procedures have been designed under the
supervision of the Company's board of directors and reviewed by an independent
auditor. The internal financial controls provide reasonable assurance regarding
the reliability of the Company's financial reporting and preparation of
financial statements in accordance with generally accepted accounting
principals. There have been no significant changes in these controls or in other
factors that could significantly affect these controls since they were
instituted, including any corrective actions with regard to significant
deficiencies and material weaknesses.

<PAGE>


                           PART II: OTHER INFORMATION

ITEM 1:     LEGAL PROCEEDINGS:

The Company is not a party to any pending legal proceeding or litigation and
none of the Company's property is the subject of a pending legal proceeding.

ITEM 2:     UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS:

Three months ended January 31, 2006
-----------------------------------

On August 25, 2005 the Company entered into a Consulting Agreement with Endeavor
Holdings, Inc. (Endeavor) of New York, New York to assist the Company in raising
capital. Under the terms of this agreement the Company agreed to pay Endeavor
150,000 common shares at the rate of 25,000 shares per month. Either party may
cancel the agreement on 30 days notice. As of October 31, 2005 the Company had
issued 75,000 common shares valued at $65,250, to Endeavor. As of the three
months ended January 31, 2006 the Company had issued the final 75,000 common
shares valued at $65,250.

On October 18, 2005 the Company authorized the issuance of 14,000 common shares
for the exercise of 14,000 warrants from a warrant holder in consideration of
$12,000.

On October 18 and 24, 2005, the Company issued a total of 59,547 common shares
and 29,167 warrants covering the principal amount of $43,750 plus interest of
$910 in accordance with the conversion provision of the note of $43,750 received
from two accredited investors on October 6, 2004.

On November 9, 2005, one accredited investor converted the promissory note on
its due date and the company issued 76,525 common shares and 37,500 warrants
covering the principal amount of $56,250 and interest in the amount of $1,143 in
accordance with the conversion provisions of the notes. The expiry date of the
warrants was extended to 15 months after the conversion date.

On December 5, 2005, the Company authorized the issuance of 150,000 common
shares and 150,000 warrants to one accredited investor in consideration of
$151,500, payable by delivery of $100,000 in cash and a promissory note in the
principal amount of $51,500 due on January 15, 2006. Each common share was
valued at $1.00 per share and each warrant at $0.01. Each warrant entitles the
holder to purchase one common share at a purchase price of $1.00 per share on or
before December 4, 2006. As of January 31, 2006, $1,500 of the amount to be
advanced to the Company against the promissory note was still outsatnding. This
amount was subsequently paid by the investor.

On December 6, 2005, the board of directors authorized the issuance of 133,333
common shares (valued at $100,000) and a cash payment of $43,406 (CND $50,000)
to Atna Resources Inc. as a "property payment" under the Marg Property
Acquisition Agreement. These common shares and the cash payment were delivered
to Atna on December 12, 2005, the due date for the payment under the Marg
Property Acquisition Agreement. This entire payment of $143,406 was expensed in
the consolidated statements of operations

On December 7, 2005 the board of directors authorized the issuance of 10,000
common shares to a shareholder for the exercise of 10,000 warrants in
consideration of $8,772 (CDN $10,000).

On December 7, 2005, an investor converted promissory notes of the Company on
their due date. The Company issued this investor, pursuant to such conversion,
34,306 common shares and 17,001 warrants covering the principal amounts of
$25,500 and interest in the amount of $409 in accordance with the conversion
provisions of the notes. The expiry date of the warrants was extended to 15
months after the conversion date.


On January 11, 2006 the accredited investor converted the promissory notes on
their due dates and the company issued 101,150 common shares and 50,000 warrants
covering the principal amounts of $75,000 and interest in the amount of $1,533
in accordance with the conversion provisions of the notes. The expiry date of
the warrants was extended to 15 months after the conversion date.


On December 15, 2005, the Company completed the sale of 400,000 Special Warrants
to an accredited investor, for $404,000. Each Special Warrant entitles its
holder to acquire one common share of the Company at a purchase price of $1.00
per share and one common share purchase warrant which entitles the holder to
purchase an additional common share at a purchase price of $0.01 per share. The
Special Warrants may not be exercised until the earlier of: (i) the
Qualification Time (as defined below), or (ii) the date which is 181 days from
the closing date of the sale of the Special Warrants (the "Expiry Time"). All
Special Warrants will be automatically exercised or deemed exercised without any
further action on the part of the holder at 4:30 p.m. (Toronto time) on the
earlier of: (i) the fifth business day after the date upon which a registration
statement to be filed by the Company under the Securities Act of 1933, as
amended, has been declared effective by the Securities and Exchange Commission
with respect to the distribution of the common shares and warrants issuable upon
exercise of the Special Warrants (the "Qualification Time") or (ii) the Expiry
Time. If by 4:30 p.m. (Toronto time) on the date which is 180 days from the
closing date such registration statement has not been declared effective, the
holders of Special Warrants shall thereafter be entitled to receive, upon the
exercise or deemed exercise of the Special Warrants, 1.1 common shares and 1.1
warrants for each Special Warrant then held by such holder (in lieu of one
common share and one warrant otherwise receivable) at no additional cost. The
Company has undertaken to use its reasonable best efforts to file a registration
statement under the Securities Act of 1933 to qualify the shares and warrants
underlying the Special Warrants with the objective of being declared effective
on or before 180 days from closing.


<PAGE>


On December 30, 2005 the Company completed the sale of 200,000 Flow-Through
Special Warrants ("FT Special Warrants") to National Bank Trust Inc. for the
account of Northern Precious Metals 2005 Limited Partnership, a Canadian
accredited investor, for $180,000. Each FT Special Warrant entitles the holder
to acquire one flow through common share of the Company ("Flow-Through Shares")
at no additional cost. The term "Flow-Through Shares" is significant for tax
purposes in Canada because it enables the issuer to allocate certain exploration
tax credit to the holders of such shares. The FT Special Warrants may be
exercised at any time but will automatically be exercised on the earlier of: (i)
the FT Qualification Time (as defined below), or (ii) the date which is 181 days
from the date of the Special Warrant Certificate (December 30, 2005), or such
later date as may be agreed upon between the Company and holder of the FT
Special Warrants (the "FT Expiry Time"). All FT Special Warrants will be
automatically exercised without any further action by the holder at 4:30 p.m.
(Toronto time) on the earlier of: (i) the fifth business day after the date upon
which a registration statement to be filed by the Company under the Securities
Act has been declared effective by the SEC with respect to the distribution of
the Flow-Through Shares issuable upon exercise of the FT Special Warrants (the
"FT Qualification Time") or (ii) the FT Expiry Time. The Company has undertaken
to use its reasonable best efforts to file a registration statement with the SEC
to qualify the Flow-Through Shares to become effective on or before 180 days
after December 30, 2005, the date of the closing of the FT Special Warrant sale.


ITEM 3:     DEFAULTS UPON SENIOR SECURITIES:

                  None.

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

                  None.

ITEM 5:     OTHER INFORMATION:

Subsequent to January 31, 2006, the Company received the balance outstanding of
$1,500 relating to a promissory note issued by the Company on December 5, 2005,
referred to above under "Item 2: UNREGISTERED SALES OF EQUITY SECURITIES AND USE
OF PROCEEDS."

The Company has an oral agreement with a placement agent, to place up to $3.0
million of its securities in Canada. Under this agreement, the placement agent
would receive a cash payment equal to 9% of the gross proceeds of the private
placement plus warrants equal to 10% of such gross proceeds.

On January 17, 2006, the Company's Board accepted the resignation of Warren
Holmes in his capacity as CEO. Mr. Holmes will continue to sit on the Board as
Chairman. There were no disagreements between the Company and Mr. Holmes with
respect to the Company's operations, policies or practices.

Also on January 17, 2006, the Company's Board accepted the resignation of Brian
Robertson in his capacity as President. Mr. Robertson stated that his
resignation is due to other commitments and that he could no longer serve the
Company. There were no disagreements between the Company and Mr. Robertson with
respect to the Company's operations, policies or practices.

On January 17, 2006 the Board appointed Kenneth Hill as CEO to fill the vacancy
left by Mr. Holmes. Mr. Hill was also appointed as President to fill the vacancy
left by Mr. Robertson. Mr. Hill is the founder of ProMin Consulting Associates
Inc., a Canadian company that provides independent consulting and project
management services to the global minerals industry. Prior to his involvement
with ProMin Consulting Associates Inc., Mr. Hill held senior positions involving
mine design, mine development and mine operations with Inmet Mining Corp.,
Northgate Exploration Ltd., Dome Mines Ltd. (now Placer Dome Inc.) and J.S.
Redpath Ltd. Mr. Hill is a registered professional engineer and graduated with a
degree in Geological Engineering from the Michigan Technological University. He
also holds a degree in Mining Technology from the Haileybury School of Mines.
Mr. Hill has over forty years of experience in the mining industry and has been
a director of the Company since December 15, 2004.


ITEM 6:     EXHIBITS & REPORTS ON FORM 8-K

Exhibits

(a)      31.1 Certification of Chief Executive Officer.
         31.2 Certification of Chief Financial Officer.
         32.1 Certificate of Chief Executive Officer and
              Chief Financial Officer.


SIGNATURE

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

Dated:  March 15, 2006                   /s/ Ken J. Hill
                                         ---------------------------------------
                                         Ken J Hill, President, CEO and Director


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