UNITED
STATES SECURITIES AND EXCHANGE COMMISSION


Washington, D.C.
20549





FORM 10-Q





x
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE


SECURITIES
EXCHANGE ACT OF 1934


For
the quarterly period ended December 31, 2009





 ̈TRANSITION REPORT PURSUANT
TO SECTION 13 OR 15(d) OF THE


SECURITIES
EXCHANGE ACT OF 1934





Commission
File Number: 000-52641





INFRASTRUCTURE MATERIALS CORP.


(Exact
name of registrant as specified in its charter)





Delaware
              
              98-0492752(State
      of incorporation)
              
              (I.R.S.
      Employer Identification No.)





1135
Terminal Way, Suite 207B


Reno,
NV  89502  USA


(Address
of Principal Executive Offices) (Zip Code)





866-448-1073


(Registrant’s
telephone number, including area code)




With a
copy to:


Jonathan
H. Gardner


Kavinoky
Cook LLP


726
Exchange St., Suite 800


Buffalo,
NY 14210





Indicate
by check mark whether the registrant (1) has filed all reports required to
be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934
during the preceding 12 months (or for such shorter period that the
Registrant was required to file such reports), and (2) has been subject to
such filing requirements for the past 90 days.


Yes þ No o





Indicate
by check mark whether the registrant ha submitted electronically and posted on
its corporate Web site, if any, every Interactive Data File required to be
submitted and posted pursuant to Rule 405 of Regulation S-T (232.405 of this
chapter) during the preceding 12 months (or for such shorter period that the
registrant was required to submit and post such files).


Yes þ No o





Indicate
by check mark whether the registrant is a large accelerated filer, an
accelerated filer, a non-accelerated filer, or a smaller reporting company. See
the definitions of “large accelerated filer,” “accelerated filer” and “smaller
reporting company” in Rule 12b-2 of the Exchange Act. (Check one):




Large
      accelerated filer o
                Accelerated
      filer o
                Non-accelerated
      filer   o
                Smaller
      reporting company þ(Do
      not check if a smaller reporting
company)


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





The
number of shares of registrant’s common stock outstanding as of December 31,
2009 was 60,198,500.





INFRASTRUCTURE
MATERIALS CORP.





FORM
10-Q


FOR
THE QUARTERLY PERIOD ENDED DECEMBER 31, 2009


TABLE
OF CONTENTS





PAGEPART
      1 – FINANCIAL INFORMATIONItem
      1.
                Financial
      Statements (Unaudited)
                
                3Item
      2.
                Management’s
      Discussion and Analysis of Financial Condition and Results of
      Operations
                
                25Item
      3.
                Quantitative
      and Qualitative Disclosures About Market Risk
                
                36Item
      4T.
                Controls
      and Procedures
                
                36PART
      II – OTHER INFORMATIONItem
      1.
                Legal
      Proceedings
                
                38Item
      1A.
                Risk
      Factors
                
                38Item
      2.
                Unregistered
      Sale of Equity Securities and Use of Proceeds
                
                42Item
      3.
                Defaults
      Upon Senior Securities
                
                42Item
      4.
                Submission
      of Matters to a Vote of Security Holders
                
                42Item
      5.
                Other
      Information
                
                43Item
      6.
                Exhibits
      and Reports on Form 8-K
                
                43SIGNATURES
                
                44


- 2
-


PART
1 – FINANCIAL INFORMATION





ITEM
1                 Financial
Statements




INFRASTRUCTURE
MATERIALS CORP.


(AN
EXPLORATION STAGE MINING COMPANY)




INTERIM
CONSOLIDATED FINANCIAL STATEMENTS




December
31, 2009




(Amounts
expressed in US Dollars)




(Unaudited-Prepared
by Management)





CONTENTS





Interim
      Consolidated Balance Sheets as of December 31, 2009 (unaudited) and June
      30, 2009 (audited)
                
                4Interim
      Consolidated Statements of Operations for the six months and three months
      ended December 31, 2009 and December 31, 2008, and for the period from
      inception to December 31, 2009
                
                5Interim
      Consolidated Statements of Changes in Stockholders' Equity for the six
      months endedDecember
      31, 2009 and for the period from inception to December 31,
      2009
                
                6Interim
      Consolidated Statements of Cash Flows for the six months ended December
      31, 2009 and December 31, 2008, and for the period from inception to
      December 31, 2009
                
                7Condensed
      Notes to Interim Consolidated Financial Statements
                
                8 -
      24


- 3
-




INFRASTRUCTURE
MATERIALS CORP.


(AN
EXPLORATION STAGE MINING COMPANY)


Interim
Consolidated Balance Sheets as at


December
31, 2009 and June 30, 2009


(Amounts
expressed in US Dollars)


(Unaudited-Prepared
by Management)





Dec
      31,
                            
                            
                            June
      30,2009
                            
                            
                            2009$
                            
                            
                            $(unaudited)
                            
                            
                            (audited)ASSETSCurrentCash
      and cash equivalents
                            
                            
                            183,394
                            
                            
                            
                            420,266Short
      term investments
                            
                            
                            1,534,147
                            
                            
                            
                            3,116,803Prepaid
      expenses and other receivables
                            
                            
                            191,191
                            
                            
                            
                            205,482Total
      Current Assets
                            
                            
                            1,908,732
                            
                            
                            
                            3,742,551Plant and Equipment, net
      (note 4)
                            
                            
                            1,056,983
                            
                            
                            
                            1,141,920Total
      Assets
                            
                            
                            2,965,715
                            
                            
                            
                            4,884,471LIABILITIESCurrentAccounts
      payable
                            
                            
                            130,497
                            
                            
                            
                            187,000Accrued
      liabilities
                            
                            
                            156,706
                            
                            
                            
                            83,901Total
      Current Liabilities
                            
                            
                            287,203
                            
                            
                            
                            270,901Total
      Liabilities
                            
                            
                            287,203
                            
                            
                            
                            270,901Commitments and
      Contingencies (note 9)Related Party
      Transactions (note 10)STOCKHOLDERS'
      EQUITYCapital
      Stock (note 6)Common
      stock, $0.0001 par value, 100,000,000 shares authorized, 60,198,500 issued
      and outstanding (June 30, 2009 – 60,198,500)
                            
                            
                            6,020
                            
                            
                            
                            6,020Additional
      Paid-in Capital
                            
                            
                            17,392,021
                            
                            
                            
                            17,224,699Deferred
      Stock Compensation (note 8)
                            
                            
                            -
                            
                            
                            
                            (187,500
                            )Deficit
      Accumulated During the Exploration Stage
                            
                            
                            (14,719,529
                            )
                            
                            
                            (12,429,649
                            )Total
      Stockholders' Equity
                            
                            
                            2,678,512
                            
                            
                            
                            4,613,570Total Liabilities and
      Stockholders' Equity
                            
                            
                            2,965,715
                            
                            
                            
                            4,884,471





See
Condensed notes to the Interim Financial Statements




- 4
-




INFRASTRUCTURE
MATERIALS CORP.


(AN
EXPLORATION STAGE MINING COMPANY)


Interim
Consolidated Statements of Operations


For the
six months and three months ended December 31, 2009 and December 31, 2008 and
the Period from Inception (June 3, 1999) to December 31, 2009


(Amounts
expressed in US Dollars)


(Unaudited-Prepared
by Management)





For
      the
                                
                                
                                For
      the
                                
                                
                                For
      the
                                
                                
                                For
      thesix
      months
                                
                                
                                six
      months
                                
                                
                                three
      months
                                
                                
                                three
      monthsCumulative
                                
                                
                                ended
                                
                                
                                ended
                                
                                
                                ended
                                
                                
                                endedsince
                                
                                
                                Dec
      31,
                                
                                
                                Dec
      31,
                                
                                
                                Dec
      31,
                                
                                
                                Dec
      31,inception
                                
                                
                                2009
                                
                                
                                2008
                                
                                
                                2009
                                
                                
                                2008$
                                
                                
                                $
                                
                                
                                $
                                
                                
                                $
                                
                                
                                $Operating
      ExpensesGeneral
      and administration
                                
                                
                                6,479,656
                                
                                
                                
                                878,310
                                
                                
                                
                                1,851,144
                                
                                
                                
                                429,114
                                
                                
                                
                                1,116,784Project
      expenses
                                
                                
                                7,728,572
                                
                                
                                
                                1,346,853
                                
                                
                                
                                1,197,178
                                
                                
                                
                                561,082
                                
                                
                                
                                565,506Amortization
                                
                                
                                801,761
                                
                                
                                
                                90,368
                                
                                
                                
                                106,333
                                
                                
                                
                                45,113
                                
                                
                                
                                53,328Total
      Operating Expenses
                                
                                
                                15,009,989
                                
                                
                                
                                2,315,531
                                
                                
                                
                                3,154,655
                                
                                
                                
                                1,035,309
                                
                                
                                
                                1,735,618Loss
      from Operations
                                
                                
                                (15,009,989
                                )
                                
                                
                                (2,315,531
                                )
                                
                                
                                (3,154,655
                                )
                                
                                
                                (1,035,309
                                )
                                
                                
                                (1,735,618
                                )Other
      income-interest
                                
                                
                                380,913
                                
                                
                                
                                25,651
                                
                                
                                
                                26,312
                                
                                
                                
                                11,298
                                
                                
                                
                                14,513Interest Expense
                                
                                
                                (90,453
                                )
                                
                                
                                -
                                
                                
                                
                                -
                                
                                
                                
                                -
                                
                                
                                
                                -Loss
      before Income Taxes
                                
                                
                                (14,719,529
                                )
                                
                                
                                (2,289,880
                                )
                                
                                
                                (3,128,343
                                )
                                
                                
                                (1,024,011
                                )
                                
                                
                                (1,721,105
                                )Provision
      for income taxes
                                
                                
                                -
                                
                                
                                
                                -
                                
                                
                                
                                -
                                
                                
                                
                                -
                                
                                
                                
                                -Net
      Loss
                                
                                
                                (14,719,529
                                )
                                
                                
                                (2,289,880
                                )
                                
                                
                                (3,128,343
                                )
                                
                                
                                (1,024,011
                                )
                                
                                
                                (1,721,105
                                )Loss
      per Weighted Average Number of Shares Outstanding-Basic
      and Fully Diluted
                                
                                
                                
                                
                                
                                
                                (0.04
                                )
                                
                                
                                (0.06
                                )
                                
                                
                                (0.02
                                )
                                
                                
                                (0.03
                                )Basic
      Weighted Average Number of Shares Outstanding During the
      Periods-Basic
      and Fully Diluted
                                
                                
                                
                                
                                
                                
                                60,198,500
                                
                                
                                
                                49,726,609
                                
                                
                                
                                60,198,500
                                
                                
                                
                                51,137,920





See
Condensed notes to the Interim Financial Statements


- 5
-




INFRASTRUCTURE
MATERIALS CORP.


(AN
EXPLORATION STAGE MINING COMPANY)


Interim
Consolidated Financial Statements of Changes in Stockholders’
Equity


From
Inception (June 3, 1999) to December 31, 2009


(Amounts
expressed in US Dollars)


(Unaudited-Prepared
by Management)





DeficitAccumulatedCommon Stock
                                            
                                            
                                            Additional
                                            
                                            
                                            Deferred
                                            
                                            
                                            during the
                                            
                                            
                                            TotalNumber
                                            
                                            
                                            
                                            
                                            
                                            Paid-in
                                            
                                            
                                            Stock
                                            
                                            
                                            Exploration
                                            
                                            
                                            Stockholders'of Shares
                                            
                                            
                                            Amount
                                            
                                            
                                            Capital
                                            
                                            
                                            Compensation
                                            
                                            
                                            Stage
                                            
                                            
                                            Equity$
                                            
                                            
                                            $
                                            
                                            
                                            $
                                            
                                            
                                            $
                                            
                                            
                                            $For
      the period from inception (June 3, 1999) through July 1,
    2004
                                            
                                            
                                            1
                                            
                                            
                                            
                                            -
                                            
                                            
                                            
                                            5,895
                                            
                                            
                                            
                                            
                                            
                                            
                                            
                                            (5,895
                                            )
                                            
                                            
                                            -Net
      (loss)
                                            
                                            
                                            -
                                            
                                            
                                            
                                            -
                                            
                                            
                                            
                                            910
                                            
                                            
                                            
                                            
                                            
                                            
                                            
                                            (910
                                            )
                                            
                                            
                                            -Balance,
      June 30, 2005 (audited)
                                            
                                            
                                            1
                                            
                                            
                                            
                                            -
                                            
                                            
                                            
                                            6,805
                                            
                                            
                                            
                                            -
                                            
                                            
                                            
                                            (6,805
                                            )
                                            
                                            
                                            -Contribution
      to additional paid-in capital
                                            
                                            
                                            -
                                            
                                            
                                            
                                            -
                                            
                                            
                                            
                                            3,024
                                            
                                            
                                            
                                            
                                            
                                            
                                            
                                            
                                            
                                            
                                            
                                            3,024Cancelled
      shares
                                            
                                            
                                            (1
                                            )
                                            
                                            
                                            -
                                            
                                            
                                            
                                            (1
                                            )
                                            
                                            
                                            
                                            
                                            
                                            
                                            
                                            
                                            
                                            
                                            (1
                                            )Common
      shares issued for nil consideration
                                            
                                            
                                            14,360,000
                                            
                                            
                                            
                                            1,436
                                            
                                            
                                            
                                            (1,436
                                            )
                                            
                                            
                                            
                                            
                                            
                                            
                                            -
                                            
                                            
                                            
                                            -Common
      shares issued for cash
                                            
                                            
                                            2,050,000
                                            
                                            
                                            
                                            205
                                            
                                            
                                            
                                            414,795
                                            
                                            
                                            
                                            
                                            
                                            
                                            
                                            -
                                            
                                            
                                            
                                            415,000Subscription
      for stock
                                            
                                            
                                            
                                            
                                            
                                            
                                            
                                            
                                            
                                            
                                            300,000
                                            
                                            
                                            
                                            
                                            
                                            
                                            
                                            -
                                            
                                            
                                            
                                            300,000Stock
      issuance cost
                                            
                                            
                                            -
                                            
                                            
                                            
                                            -
                                            
                                            
                                            
                                            (24,500
                                            )
                                            
                                            
                                            
                                            
                                            
                                            
                                            -
                                            
                                            
                                            
                                            (24,500
                                            )Net
      loss
                                            
                                            
                                            -
                                            
                                            
                                            
                                            -
                                            
                                            
                                            
                                            -
                                            
                                            
                                            
                                            
                                            
                                            
                                            
                                            (87,574
                                            )
                                            
                                            
                                            (87,574
                                            )Balance,
      June 30, 2006 (audited)
                                            
                                            
                                            16,410,000
                                            
                                            
                                            
                                            1,641
                                            
                                            
                                            
                                            698,687
                                            
                                            
                                            
                                            -
                                            
                                            
                                            
                                            (94,379
                                            )
                                            
                                            
                                            605,949Common
      shares issued for cash
                                            
                                            
                                            3,395,739
                                            
                                            
                                            
                                            340
                                            
                                            
                                            
                                            548,595
                                            
                                            
                                            
                                            
                                            
                                            
                                            
                                            -
                                            
                                            
                                            
                                            548,935Common
      shares issued to agents in lieu of commission for placement of common
      shares and convertible debentures
                                            
                                            
                                            1,064,000
                                            
                                            
                                            
                                            106
                                            
                                            
                                            
                                            265,894
                                            
                                            
                                            
                                            
                                            
                                            
                                            
                                            -
                                            
                                            
                                            
                                            266,000Common
      shares issued for acquisition of interests in mineral
    claims
                                            
                                            
                                            3,540,600
                                            
                                            
                                            
                                            354
                                            
                                            
                                            
                                            884,796
                                            
                                            
                                            
                                            
                                            
                                            
                                            
                                            -
                                            
                                            
                                            
                                            885,150Common
      shares issued for acquisition of interests in mineral
    claims
                                            
                                            
                                            1,850,000
                                            
                                            
                                            
                                            185
                                            
                                            
                                            
                                            462,315
                                            
                                            
                                            
                                            
                                            
                                            
                                            
                                            -
                                            
                                            
                                            
                                            462,500Common
      shares issued for acquisition of interests in a refinery
                                            
                                            
                                            88,500
                                            
                                            
                                            
                                            9
                                            
                                            
                                            
                                            22,116
                                            
                                            
                                            
                                            
                                            
                                            
                                            
                                            -
                                            
                                            
                                            
                                            22,125Common
      shares issued for purchase of a mill with capital
    equipments
                                            
                                            
                                            6,975,000
                                            
                                            
                                            
                                            697
                                            
                                            
                                            
                                            1,743,053
                                            
                                            
                                            
                                            
                                            
                                            
                                            
                                            -
                                            
                                            
                                            
                                            1,743,750Stock
      issuance cost
                                            
                                            
                                            
                                            
                                            
                                            
                                            
                                            
                                            
                                            
                                            (59,426
                                            )
                                            
                                            
                                            
                                            
                                            
                                            
                                            
                                            
                                            
                                            
                                            (59,426
                                            )Stock
      based compensation
                                            
                                            
                                            
                                            
                                            
                                            
                                            
                                            
                                            
                                            
                                            30,026
                                            
                                            
                                            
                                            
                                            
                                            
                                            
                                            
                                            
                                            
                                            
                                            30,026Net
      loss for the year ended June 30, 2007
                                            
                                            
                                            
                                            
                                            
                                            
                                            -
                                            
                                            
                                            
                                            -
                                            
                                            
                                            
                                            -
                                            
                                            
                                            
                                            (2,845,424
                                            )
                                            
                                            
                                            (2,845,424
                                            )Balance,
      June 30, 2007 (audited)
                                            
                                            
                                            33,323,839
                                            
                                            
                                            
                                            3,332
                                            
                                            
                                            
                                            4,596,056
                                            
                                            
                                            
                                            -
                                            
                                            
                                            
                                            (2,939,803
                                            )
                                            
                                            
                                            1,659,585Common
      stock issued to consultants
                                            
                                            
                                            3,000,000
                                            
                                            
                                            
                                            300
                                            
                                            
                                            
                                            2,249,700
                                            
                                            
                                            
                                            (1,875,000
                                            )
                                            
                                            
                                            -
                                            
                                            
                                            
                                            375,000Stock
      based compensation
                                            
                                            
                                            
                                            
                                            
                                            
                                            -
                                            
                                            
                                            
                                            139,272
                                            
                                            
                                            
                                            
                                            
                                            
                                            
                                            -
                                            
                                            
                                            
                                            139,272Conversion
      of convertible debentures with accrued interest
                                            
                                            
                                            7,186,730
                                            
                                            
                                            
                                            719
                                            
                                            
                                            
                                            3,590,801
                                            
                                            
                                            
                                            -
                                            
                                            
                                            
                                            -
                                            
                                            
                                            
                                            3,591,520Common
      shares issued for acquisition of interests in mineral
      claims
                                            
                                            
                                            175,000
                                            
                                            
                                            
                                            18
                                            
                                            
                                            
                                            104,982
                                            
                                            
                                            
                                            
                                            
                                            
                                            
                                            
                                            
                                            
                                            
                                            105,000Common
      stock issued to a consultant
                                            
                                            
                                            100,000
                                            
                                            
                                            
                                            10
                                            
                                            
                                            
                                            57,990
                                            
                                            
                                            
                                            
                                            
                                            
                                            
                                            
                                            
                                            
                                            
                                            58,000Amortization
      of deferred stock compensation
                                            
                                            
                                            
                                            
                                            
                                            
                                            
                                            
                                            
                                            
                                            
                                            
                                            
                                            
                                            562,500
                                            
                                            
                                            
                                            
                                            
                                            
                                            
                                            562,500Net
      loss for the year
                                            
                                            
                                            
                                            
                                            
                                            
                                            
                                            
                                            
                                            
                                            
                                            
                                            
                                            
                                            
                                            
                                            
                                            
                                            (3,791,042
                                            )
                                            
                                            
                                            (3,791,042
                                            )Balance
      June 30, 2008 (audited)
                                            
                                            
                                            43,785,569
                                            
                                            
                                            
                                            4,379
                                            
                                            
                                            
                                            10,738,801
                                            
                                            
                                            
                                            (1,312,500
                                            )
                                            
                                            
                                            (6,730,845
                                            )
                                            
                                            
                                            2,699,835Common
      shares issued for cash (net)
                                            
                                            
                                            7,040,000
                                            
                                            
                                            
                                            704
                                            
                                            
                                            
                                            3,372,296
                                            
                                            
                                            
                                            -
                                            
                                            
                                            
                                            -
                                            
                                            
                                            
                                            3,373,000Common
      stock issued to a consultant
                                            
                                            
                                            75,000
                                            
                                            
                                            
                                            7
                                            
                                            
                                            
                                            43,493
                                            
                                            
                                            
                                            -
                                            
                                            
                                            
                                            -
                                            
                                            
                                            
                                            43,500Common
      stock issued on acquisition of a subsidiary
                                            
                                            
                                            397,024
                                            
                                            
                                            
                                            40
                                            
                                            
                                            
                                            31,722
                                            
                                            
                                            
                                            -
                                            
                                            
                                            
                                            -
                                            
                                            
                                            
                                            31,762Common
      shares issued on warrant exercises
                                            
                                            
                                            8,900,907
                                            
                                            
                                            
                                            890
                                            
                                            
                                            
                                            2,224,337
                                            
                                            
                                            
                                            -
                                            
                                            
                                            
                                            -
                                            
                                            
                                            
                                            2,225,227Stock
      based compensation
                                            
                                            
                                            
                                            
                                            
                                            
                                            
                                            
                                            
                                            
                                            814,050
                                            
                                            
                                            
                                            
                                            
                                            
                                            
                                            
                                            
                                            
                                            
                                            814,050Amortization
      of deferred stock compensation
                                            
                                            
                                            
                                            
                                            
                                            
                                            
                                            
                                            
                                            
                                            
                                            
                                            
                                            
                                            1
      ,125,000
                                            
                                            
                                            
                                            
                                            
                                            
                                            
                                            1
      ,125,000Net
      loss for the year
                                            
                                            
                                            
                                            
                                            
                                            
                                            
                                            
                                            
                                            
                                            
                                            
                                            
                                            
                                            
                                            
                                            
                                            
                                            (5,698,804
                                            )
                                            
                                            
                                            (5,698,804
                                            )Balance
      June 30, 2009 (audited)
                                            
                                            
                                            60,198,500
                                            
                                            
                                            
                                            6,020
                                            
                                            
                                            
                                            17,224,699
                                            
                                            
                                            
                                            (187,500
                                            )
                                            
                                            
                                            (12,429,649
                                            )
                                            
                                            
                                            4,613,570Stock
      based compensation
                                            
                                            
                                            
                                            
                                            
                                            
                                            
                                            
                                            
                                            
                                            167,322
                                            
                                            
                                            
                                            
                                            
                                            
                                            
                                            -
                                            
                                            
                                            
                                            167,322Amortization
      of deferred stock compensation
                                            
                                            
                                            
                                            
                                            
                                            
                                            
                                            
                                            
                                            
                                            
                                            
                                            
                                            
                                            187,500
                                            
                                            
                                            
                                            
                                            
                                            
                                            
                                            187,500Net
      loss for the six month period
                                            
                                            
                                            
                                            
                                            
                                            
                                            
                                            
                                            
                                            
                                            
                                            
                                            
                                            
                                            
                                            
                                            
                                            
                                            (2,289,880
                                            )
                                            
                                            
                                            (2,289,880
                                            )Balance
      December 31, 2009 (unaudited)
                                            
                                            
                                            60,198,500
                                            
                                            
                                            
                                            6,020
                                            
                                            
                                            
                                            17,392,021
                                            
                                            
                                            
                                            -
                                            
                                            
                                            
                                            (14,719,529
                                            )
                                            
                                            
                                            2,678,512




See Condensed notes to the Interim
Financial Statements




- 6
-




INFRASTRUCTURE
MATERIALS CORP.


(AN
EXPLORATION STAGE MINING COMPANY)


Interim
Consolidated Statements of Cash Flows


For the
six months ended December 31, 2009 and December 31, 2008


and for
the period from Inception (June 3, 1999) to December 31, 2009.


(Amounts
expressed in US Dollars)


(Unaudited-Prepared
by Management)





For
      the six
                                  
                                  
                                  For
      the sixCumulative
                                  
                                  
                                  months
      ended
                                  
                                  
                                  months
      endedSince
                                  
                                  
                                  Dec
      31,
                                  
                                  
                                  Dec
      31,Inception
                                  
                                  
                                  2009
                                  
                                  
                                  2008Cash
      Flows from Operating ActivitiesNet
      loss
                                  
                                  
                                  (14,719,529
                                  )
                                  
                                  
                                  (2,289,880
                                  )
                                  
                                  
                                  (3,128,343
                                  )Adjustment
      for:Amortization
                                  
                                  
                                  801,761
                                  
                                  
                                  
                                  90,368
                                  
                                  
                                  
                                  106,333Amortization
      of debt issuance cost
                                  
                                  
                                  247,490
                                  
                                  
                                  
                                  -
                                  
                                  
                                  
                                  -Stock
      based compensation
                                  
                                  
                                  1,150,670
                                  
                                  
                                  
                                  167,322
                                  
                                  
                                  
                                  594,612Shares
      issued for mineral claims, as part of project expenses
                                  
                                  
                                  1,452,650
                                  
                                  
                                  
                                  -
                                  
                                  
                                  
                                  -Shares
      issued for consultant services expensed
                                  
                                  
                                  2,351,500
                                  
                                  
                                  
                                  187,500
                                  
                                  
                                  
                                  606,000Shares
      issued on acquisition of subsidiary
                                  
                                  
                                  31,762
                                  
                                  
                                  
                                  -
                                  
                                  
                                  
                                  31,762Interest
      on convertible debentures
                                  
                                  
                                  90,453
                                  
                                  
                                  
                                  -
                                  
                                  
                                  
                                  -Changes
      in non-cash working capitalPrepaid
      expenses
                                  
                                  
                                  (191,191
                                  )
                                  
                                  
                                  14,291
                                  
                                  
                                  
                                  22,467Accounts
      payable
                                  
                                  
                                  130,497
                                  
                                  
                                  
                                  (56,503
                                  )
                                  
                                  
                                  (42,864
                                  )Accrued
      liabilities
                                  
                                  
                                  157,147
                                  
                                  
                                  
                                  72,805
                                  
                                  
                                  
                                  (104,001
                                  )Net
      cash used in operating activities
                                  
                                  
                                  (8,496,790
                                  )
                                  
                                  
                                  (1,814,097
                                  )
                                  
                                  
                                  (1,914,034
                                  )Cash
      Flows from Investing ActivitiesDecrease
      (Increase) in Short-term investments
                                  
                                  
                                  (1,534,147
                                  )
                                  
                                  
                                  1,582,656
                                  
                                  
                                  
                                  -Acquisition
      of plant and equipment for cash
                                  
                                  
                                  (95,203
                                  )
                                  
                                  
                                  (5,431
                                  )
                                  
                                  
                                  (8,905
                                  )Proceeds
      from sale of plant and equipment
                                  
                                  
                                  2,500
                                  
                                  
                                  
                                  -
                                  
                                  
                                  
                                  -Net
      cash provided (used) in investing activities
                                  
                                  
                                  (1,626,850
                                  )
                                  
                                  
                                  1,577,225
                                  
                                  
                                  
                                  (8,905
                                  )Cash
      Flows from Financing ActivitiesIssuance
      of common shares for cash
                                  
                                  
                                  4,790,740
                                  
                                  
                                  
                                  -
                                  
                                  
                                  
                                  3,520,000Issuance
      of common shares for warrant exercises
                                  
                                  
                                  2,225,227
                                  
                                  
                                  
                                  -
                                  
                                  
                                  
                                  -Issuance
      of convertible debentures subsequently converted to cash
                                  
                                  
                                  3,501,067
                                  
                                  
                                  
                                  -
                                  
                                  
                                  
                                  -Stock
      and debenture placement commissions paid in cash
                                  
                                  
                                  (210,000
                                  )
                                  
                                  
                                  -
                                  
                                  
                                  
                                  (147,000
                                  )Net
      cash provided by financing activities
                                  
                                  
                                  10,307,034
                                  
                                  
                                  
                                  -
                                  
                                  
                                  
                                  3,373,000Net
      Change in Cash
                                  
                                  
                                  183,394
                                  
                                  
                                  
                                  (236,872
                                  )
                                  
                                  
                                  1,450,061Cash-
      beginning of period
                                  
                                  
                                  -
                                  
                                  
                                  
                                  420,266
                                  
                                  
                                  
                                  1,553,855Cash
      - end of period
                                  
                                  
                                  183,394
                                  
                                  
                                  
                                  183,394
                                  
                                  
                                  
                                  3,003,916Supplemental
      Cash Flow InformationInterest
      paid
                                  
                                  
                                  -
                                  
                                  
                                  
                                  -
                                  
                                  
                                  
                                  -Income
      taxes paid
                                  
                                  
                                  -
                                  
                                  
                                  
                                  -
                                  
                                  
                                  
                                  -





See
Condensed notes to the Interim Financial Statements


- 7
-




INFRASTRUCTURE
MATERIALS CORP.


(AN
EXPLORATION STAGE MINING COMPANY)


Condensed
Notes to Interim Consolidated Financial Statements


December
31, 2009


(Amounts
expressed in US Dollars)


(Unaudited-Prepared
by Management)







1.
            Basis
      of Presentation





The
accompanying unaudited condensed consolidated financial statements have been
prepared in accordance with the instructions to Form 10-Q and therefore do not
include all information and footnotes necessary for a fair presentation of
financial position, results of operations and cash flows in conformity with U.S.
generally accepted accounting principles (GAAP); however, such information
reflects all adjustments (consisting solely of normal recurring adjustments),
which are, in the opinion of management, necessary for a fair statement of the
results for the interim periods.  The condensed consolidated financial
statements should be read in conjunction with the consolidated financial
statements and Notes thereto together with management’s discussion and analysis
of financial condition and results of operations contained in the Company’s
annual report on Form 10-K for the year ended June 30, 2009. In the opinion of
management, the accompanying condensed consolidated financial statements reflect
all adjustments of a normal recurring nature considered necessary to fairly
state the financial position of the Company at December 31, 2009 and June 30,
2009, the results of its operations for the six-month periods ended December 31,
2009 and December 31, 2008, and its cash flows for the six-month periods ended
December 31, 2009 and December 31, 2008. In addition, some of the Company’s
statements in this quarterly report on Form 10-Q may be considered
forward-looking and involve risks and uncertainties that could significantly
impact expected results. The results of operations for the six-month period
ended December 31, 2009 are not necessarily indicative of results to be expected
for the full year.





The
consolidated financial statements include the accounts of the Company and its
subsidiaries, Infrastructure Materials Corp. US and Silver Reserve
Corp.  All material inter-company accounts and transactions have been
eliminated.




2.
            Exploration
      Stage Activities





The
Company's financial statements are presented on a going concern basis, which
contemplates the realization of assets and satisfaction of liabilities in the
normal course of business.




The
Company is in the exploration stage and has not yet realized revenues from its
planned operations.  The Company has incurred a cumulative loss of
$14,719,529 from inception to December 31, 2009.  The Company has
funded operations through the issuance of capital stock and convertible
debentures.  In May and June of 2006, the Company closed a private
placement of its common stock for gross proceeds of $415,000.  During
the year ended June 30, 2007 the Company raised $848,935 (including $300,000
received in the prior year as stock subscriptions) through private placement of
its common stock for cash.  The Company also issued Convertible
Debentures in the amount of $1,020,862 during the year ended June 30, 2006 and
issued Convertible Debentures in the amount of $2,480,205 during the year ended
June 30, 2007.   During the three-month period ended September
30, 2008 the Company completed private placements of common stock for proceeds
of $3,373,000 net of cash expenses. During the three-month period ended March
31, 2009 as a result of warrant exercises the Company issued common stock for
proceeds of $2,225,227. Management's plan is to continue raising additional
funds through future equity or debt financing until it achieves profitable
operations from production of minerals or metals on its properties, if
feasible.


- 8
-




INFRASTRUCTURE
MATERIALS CORP.


(AN
EXPLORATION STAGE MINING COMPANY)


Condensed
Notes to Interim Consolidated Financial Statements


December
31, 2009


(Amounts
expressed in US Dollars)


(Unaudited-Prepared
by Management)





3.
            Nature
      of Operations





On
December 1, 2008, the Company amended its Certificate of Incorporation to change
its name from “Silver Reserve Corp.” to “Infrastructure Materials
Corp.”





The
Company’s focus is on the exploration and extraction of limestone, silver and
other metals, if feasible, from its claims in the States of Nevada, Idaho and
Arizona.





The
Company is an exploration stage mining company and has not yet realized any
revenue from its operations. It is primarily engaged in the acquisition and
exploration of mineral properties. Mineral property acquisition costs are
initially capitalized in accordance with ASC 805-20-55-37, previously referenced
as the FASB Emerging Issues Task Force ("EITF") Issue 04-2.  The
Company assesses the carrying costs for impairment under ASC 930 at each fiscal
quarter end.  When it has been determined that a mineral property can
be economically developed as a result of establishing proven and probable
reserves, the costs incurred to develop such property will be
capitalized.  The Company has determined that all property payments
are impaired and accordingly has written off the acquisition costs to project
expenses.  Once capitalized, such costs will be amortized using the
units-of-production method over the estimated life of the probable
reserve.





To date,
mineral property exploration costs have been expensed as incurred.  To
date the Company has not established any proven or probable reserves on its
mineral properties.





In
November of 2008, the Company expanded its business focus to include the
exploration and, if warranted, development of cement grade limestone properties,
located in the States of Nevada, Idaho and Arizona.  The Company
acquired, as a wholly-owned subsidiary, Infrastructure Materials Corp US (“IMC
US”), a Nevada Corporation, pursuant to a Share Exchange Agreement (the “Nevada
Agreement”) among the Company, IMC US and Todd D. Montgomery dated as of
November 7, 2008. Mr. Montgomery was the sole shareholder of IMC
US.  He also serves as the Company’s Chief Executive Officer and a
member of its Board of Directors. The
Nevada Agreement was approved by the disinterested members of the Company’s
Board of Directors on November 6, 2008.  Under the terms of the Nevada
Agreement, the Company acquired all of the issued and outstanding stock of IMC
US in exchange for 397,024 shares of the Company’s common stock (“Shares” or a
“Share”)  at the agreed price of $0.50 per Share. The transaction was
measured at fair value, being the market value of the equity instruments
delivered on the transaction date. The fair value of the Company’s 397,024
Shares issued at closing was measured at $31,762.





$Fair
      value of assets acquired
                    
                    
                    -Consideration
      given
                    
                    
                    31,762Goodwill
      on acquisition
                    
                    
                    31,762





Subsequent
to the acquisition of IMC US, it was determined that the Goodwill on acquisition
was impaired and thus written off.


- 9
-




INFRASTRUCTURE
MATERIALS CORP.


(AN
EXPLORATION STAGE MINING COMPANY)


Condensed
Notes to Interim Consolidated Financial Statements


December
31, 2009


(Amounts
expressed in US Dollars)


(Unaudited-Prepared
by Management)


3.
              Nature
      of Operations - Cont'd


IMC US
controls ten limestone Projects in Nevada, made up of 1,095 mineral claims
covering 22,623 acres. IMC US has leased 100% of the Mineral Rights on an
additional 1,120 acres and 50% of the Mineral Rights on 6,740 acres. In addition
IMC US controls one limestone project in Idaho consisting of 63 mineral claims
covering 1,302 acres..  The Company does not consider the claims or
mineral rights to be material at this time and has expensed this cost to project
expense.  The Company’s assessment of the claims and mineral rights
may change after exploration of the claims.





On
December 18, 2008, the Company incorporated a second wholly owned subsidiary in
the State of Delaware under its former name, “Silver Reserve Corp.” (”SRC”). The
Company assigned all fourteen of its silver/base metal projects in Nevada to
this subsidiary. The fourteen claim groups contain 556 claims covering 11,487
acres which include 9 patented claims and 2 leased patented
claims.





SRC also
has a milling facility located in Mina, Nevada on  six claims covering
124 acres.


- 10
-




INFRASTRUCTURE
MATERIALS CORP.


(AN
EXPLORATION STAGE MINING COMPANY)


Condensed
Notes to Interim Consolidated Financial Statements


December
31, 2009


(Amounts
expressed in US Dollars)


(Unaudited-Prepared
by Management)




4.
            Plant
      and Equipment, Net




Plant and
equipment are recorded at cost less accumulated
depreciation.  Depreciation is provided commencing in the month
following acquisition using the following annual rate and method:




Computer
      equipment
              
              30%
              
              declining
      balance methodOffice
      furniture and fixtures
              
              20%
              
              declining
      balance methodLeasehold
      improvements
              
              3
      years
              
              straight
      line methodPlant
      and Machinery
              
              15%
              
              declining
      balance methodTools
              
              25%
              
              declining
      balance methodVehicles
              
              20%
              
              declining
      balance methodConsumables
              
              50%
              
              declining
      balance methodMolds
              
              30%
              
              declining
      balance methodMobile
      Equipment
              
              20%
              
              declining
      balance methodFactory
      Buildings
              
              5%
              
              declining
      balance method





Dec
      31, 2009
                        
                        
                        Accumulated
                        
                        
                        June
      30, 2009
                        
                        
                        AccumulatedCost
                        
                        
                        Depreciation
                        
                        
                        Cost
                        
                        
                        Depreciation$
                        
                        
                        $
                        
                        
                        $
                        
                        
                        $Office,
      furniture and fixtures
                        
                        
                        18,830
                        
                        
                        
                        9,550
                        
                        
                        
                        18,830
                        
                        
                        
                        8,506Computer
      equipment
                        
                        
                        12,002
                        
                        
                        
                        4,628
                        
                        
                        
                        6,571
                        
                        
                        
                        3,405Leasehold
      improvements
                        
                        
                        16,230
                        
                        
                        
                        16,230
                        
                        
                        
                        16,230
                        
                        
                        
                        14,815Plant
      and Machinery
                        
                        
                        1,514,677
                        
                        
                        
                        630,132
                        
                        
                        
                        1,514,677
                        
                        
                        
                        557,350Tools
                        
                        
                        6,725
                        
                        
                        
                        3,729
                        
                        
                        
                        6,725
                        
                        
                        
                        3,281Vehicles
                        
                        
                        76,407
                        
                        
                        
                        29,754
                        
                        
                        
                        76,407
                        
                        
                        
                        24,276Consumables
                        
                        
                        64,197
                        
                        
                        
                        57,176
                        
                        
                        
                        64,197
                        
                        
                        
                        54,835Molds
                        
                        
                        900
                        
                        
                        
                        619
                        
                        
                        
                        900
                        
                        
                        
                        569Mobile
      Equipment
                        
                        
                        73,927
                        
                        
                        
                        38,212
                        
                        
                        
                        73,927
                        
                        
                        
                        34,244Factory
      Buildings
                        
                        
                        74,849
                        
                        
                        
                        11,731
                        
                        
                        
                        74,849
                        
                        
                        
                        10,1121,858,744
                        
                        
                        
                        801,761
                        
                        
                        
                        1,853,313
                        
                        
                        
                        711,393Net
      carrying amount
                        
                        
                        
                        
                        
                        
                        1,056,983
                        
                        
                        
                        
                        
                        
                        
                        1,141,920Amortization
      charges
                        
                        
                        
                        
                        
                        
                        90,368
                        
                        
                        
                        
                        
                        
                        
                        214,204




- 11
-




INFRASTRUCTURE
MATERIALS CORP.


(AN
EXPLORATION STAGE MINING COMPANY)


Condensed
Notes to Interim Consolidated Financial Statements


December
31, 2009


(Amounts
expressed in US Dollars)


(Unaudited-Prepared
by Management)





5.
            Convertible
      Debentures




During
the years ended June 30, 2006 and June 30, 2007, the Company issued convertible
debentures for $1,020,862 and $2,480,205 respectively, for a total of
$3,501,067.  During the quarter ended December 31, 2007, all holders
of the Company’s convertible debentures exercised their conversion rights.
 Under the terms of the convertible debentures, the holders converted the
principal amount of their convertible debentures into “units” at $0.50 per unit,
where each unit consisted of one Share and one warrant to purchase a Share
at a purchase price of $0.75 per Share.  An aggregate of 7,002,134
Shares and an aggregate of 7,002,134 Share purchase warrants were issued upon
conversion of the principal amount.





The
convertible debentures had a maturity of December 31, 2007 and an interest rate
of 2% per annum.  Pursuant to the terms of the convertible debentures,
the Company had the option of paying interest in Shares or in
cash.  The Company elected to pay interest in Shares, which were
restricted upon issuance.  An aggregate of 184,596 Shares were issued
upon the conversion of the convertible debentures as payment of interest
converted at one Share for each $0.49 of interest. The Shares issued upon
conversion of the convertible debentures and the Shares underlying the warrants
were subject to “lock-up” agreements limiting the re-sale of the Shares
following exercise.  All such restrictions have expired. All of these
Shares and Shares underlying the warrants were registered under the Securities
Act of 1933, as amended (the “Securities Act”), in a registration statement that
became effective on April 24, 2007.





6.
            Issuance of common shares and
      warrants





Sixmonth period endedDecember
31,
2009





There
were no securities issued during this period.




Year ended June 30,
2009





The
Company issued 25,000 Shares to Endeavor Holdings, Inc. on each of July 1,
August 1 and September 1, of 2008 for a total of 75,000 Shares valued at $43,500
in accordance with the terms of a contract dated March 3, 2008.  The
contract was terminated on October 1, 2008.





On August
12, 2008, the Company announced that it had entered into a non-binding letter of
intent (the “LOI”) dated as of August 12, 2008 to acquire, as a wholly-owned
subsidiary, Infrastructure Materials Corp US (“IMC US”), a Nevada
corporation.  The Company completed the acquisition of all of the
outstanding shares of IMC US pursuant to a Share Exchange Agreement that was
closed on November 7, 2008. IMC US holds limestone mineral properties in the
United States, and is actively engaged in acquiring additional limestone mineral
properties.  Todd Montgomery, a director and chief executive officer
of the Company, was the sole shareholder of IMC US. The transaction was approved
by the disinterested members of the Company’s Board of Directors.






- 12
-




INFRASTRUCTURE
MATERIALS CORP.
 (AN
EXPLORATION STAGE MINING COMPANY)
 Condensed
Notes to Interim Consolidated Financial Statements
 December
31, 2009
 (Amounts
expressed in US Dollars)
 (Unaudited-Prepared
by Management)


6.
              Issuance of common shares and
      warrants - Cont'd


Under the
terms of the Share Exchange Agreement, Mr. Montgomery received 397,024 Shares at
an agreed value of $0.50 per Share  in exchange for all of the
outstanding shares of IMC US.  The transaction was measured at the
fair value, being the market value of the Shares delivered on the transaction
date.  The fair value of the Company’s 397,024 Shares was measured at
$31,762.  IMC US owns certain limestone mineral claims in the States
of Nevada and Idaho which the Company does not consider material at this time
and has expensed this cost to project expense.  The Company’s
assessment of the claims may change after exploration of the
claims.





Between
February and March 2009, the Company issued 8,900,907 Shares under the exercise
of warrants at $0.25 per Share. This exercise price of $0.25 per Share was part
of a one time offer to all warrant holders (approved by the Board of Directors
on December 11, 2008) that reduced  the exercise price from $0.75 to
$0.25 per Share if the warrants were exercised prior to February 28, 2009. The
Company received $2,225,227 and issued 8,900,907 shares.





Warrants





During
the year ended June 30, 2007, the Company issued 700,214 broker warrants at an
exercise price of $0.50 per Share to purchase convertible debentures as part of
the commission due to the agents who placed the offering of common shares and
convertible debentures.  These warrants represented an amount equal to
10% of the convertible debentures placed.  The expiry date of the
above listed broker warrants, was extended by the Board of Directors
from  June 30, 2007 to December 31, 2007 and further extended to
December 31, 2008 and further extended to December 31, 2009.  All
outstanding warrants with an exercise price of $0.50 per Share expired on
December 31, 2009.





During
the year ended June 30, 2008, all holders of the Company’s convertible
debentures exercised their conversion rights. Under the terms of the convertible
debentures, the holders converted the principal amount of their convertible
debentures into “Units” at $0.50 per Unit, where each Unit consisted of a Share
and a warrant to purchase a Share at an exercise price of $0.75 per
Share.  An aggregate of 7,002,134 Shares and an aggregate of 7,002,134
share purchase warrants were issued upon conversion of the principal amount. The
expiry date of these warrants was extended to December 31, 2009 by the Board of
Directors on June 18, 2008 and the exercise price was reduced to $0.25 by the
Board on December 11, 2008. During the year ended June 30, 2009, 6,080,907
warrants were exercised at $0.25. The remaining 921,227 warrants, with an
exercise price of $0.75, expired on December 31, 2009.





On
December 11, 2008, the Board of Directors approved a  one time offer
to all warrant holders to reduce the exercise price of all unexercised warrants
from $0.75 to $0.25 per Share, if the warrants were exercised prior to February
28, 2009. The Company received elections to purchase 8,900,907 common shares
under the exercise of warrants at $0.25 per share. The Company received total
consideration of $2,225,227 and issued 8,900,907 common shares.





During
the year ended June 30, 2009, the Company completed the private placements of
7,040,000 “Units” at $0.50 per Unit.  Each Unit consisted of one Share
and one half-Share purchase warrant (a “Warrant”).  Each full Warrant
entitles the holder to purchase one share at $0.75 on or before September 1,
2010.  The Company paid a commission of $147,000 and issued 294,000 broker
warrants to purchase Units at $0.50 per Unit in connection with the private
placement.  The Units have the same terms as those sold to
investors.  The broker warrants expire on September 1, 2010. During
the year ended June 30, 2009, 2,820,000 warrants were exercised at $0.25 per
Share.  700,000 warrants and 294,000 broker warrants remain
outstanding until September 1, 2010.








- 13
-







INFRASTRUCTURE
MATERIALS CORP.


(AN
EXPLORATION STAGE MINING COMPANY)


Condensed
Notes to Interim Consolidated Financial Statements


December
31, 2009


(Amounts
expressed in US Dollars)


(Unaudited-Prepared
by Management)


6.
                Issuance of common shares and
      warrants - Cont'd


Number ofWarrants
                                                          
                                                          
                                                          ExerciseGranted
                                                          
                                                          
                                                          Prices
                                                          
                                                          Expiry Date$Outstanding
      at June 30, 2007 and average exercise price
                                                          
                                                          
                                                          700,214
                                                          
                                                          
                                                          
                                                          0.50
                                                          
                                                          Dec 31, 2009Granted
      in year 2007-2008
                                                          
                                                          
                                                          7,002,134
                                                          
                                                          
                                                          
                                                          0.25
                                                          
                                                          Dec
      31, 2009Exercised
      in year 2007-2008
                                                          
                                                          
                                                          -
                                                          
                                                          
                                                          
                                                          -Expired
      in year 2007-2008
                                                          
                                                          
                                                          -
                                                          
                                                          
                                                          
                                                          -Cancelled
                                                          
                                                          
                                                          -
                                                          
                                                          
                                                          
                                                          -Outstanding
      at June 30, 2008 and average exercise price
                                                          
                                                          
                                                          7,702,348
                                                          
                                                          
                                                          
                                                          0.73Granted
      in year 2008-2009
                                                          
                                                          
                                                          3,520,000
                                                          
                                                          
                                                          
                                                          0.75
                                                          
                                                          Sept 1, 2010Granted
      in year 2008-2009
                                                          
                                                          
                                                          294,000
                                                          
                                                          
                                                          
                                                          0.50
                                                          
                                                          Sept
      1, 2010Exercised
      in year 2008-2009
                                                          
                                                          
                                                          (8,900,907
                                                          )
                                                          
                                                          
                                                          0.75Expired
      in year 2008-2009
                                                          
                                                          
                                                          -
                                                          
                                                          
                                                          
                                                          -Cancelled
                                                          
                                                          
                                                          -
                                                          
                                                          
                                                          
                                                          -Outstanding
      at June 30, 2009and
      average exercise price
                                                          
                                                          
                                                          2,615,441
                                                          
                                                          
                                                          
                                                          0.66Granted
      during the six month
                                                          
                                                          
                                                          -
                                                          
                                                          
                                                          
                                                          -period
      ended Dec 31, 2009
                                                          
                                                          
                                                          -
                                                          
                                                          
                                                          
                                                          -Exercised
      during the six month period
                                                          
                                                          
                                                          -
                                                          
                                                          
                                                          
                                                          -ended
      Dec 31, 2009
                                                          
                                                          
                                                          -
                                                          
                                                          
                                                          
                                                          -Expired
      during the six month periodended
      Dec 31, 2009 (granted in 2007) ($0.50)
                                                          
                                                          
                                                          (700,214
                                                          )Expired
      during the six month periodended
      Dec 31, 2009 (granted in 2008) ($0.75)
                                                          
                                                          
                                                          (921,227
                                                          )Cancelled
      during six months ended Dec 31, 2009Outstanding
      at Dec 31, 2009 and average exercise price
                                                          
                                                          
                                                          994,000
                                                          
                                                          
                                                          
                                                          0.66




7.
            Stock
      Based Compensation




In April
of 2006, the Board of Directors approved an employee stock option plan ("2006
Stock Option Plan"), the purpose of which is to enhance the Company's
stockholder value and financial performance by attracting, retaining and
motivating the Company's officers, directors, key employees, consultants and its
affiliates and to encourage stock ownership by such individuals by providing
them with a means to acquire a proprietary interest in the Company's success
through stock ownership.




Under the
2006 Stock Option Plan, officers, directors, employees and consultants who
provide services to the Company may be granted options to acquire Shares of the
Company at the fair market value of the stock on the date of
grant.  Options may have a term of up to 10 years.  The
total number of Shares reserved for issuance under the 2006 Stock Option Plan is
5,000,000.








- 14
-




INFRASTRUCTURE
MATERIALS CORP.


(AN
EXPLORATION STAGE MINING COMPANY)


Condensed
Notes to Interim Consolidated Financial Statements


December
31, 2009


(Amounts
expressed in US Dollars)


(Unaudited-Prepared
by Management)


7.
              Stock
      Based Compensation - Cont'd


Six month periodendedDecember 31, 2009





On
September 14, 2009, the Company terminated its consulting services agreement
with a consultant effective as of October 15, 2009 and agreed to extend the
expiry of his options from his termination date to October 15,
2010.





On
October 23, 2009, the Company granted options to a consultant to purchase 25,000
common shares at an exercise price of $0.33 per share. These options were
granted in accordance with the terms of the Company’s 2006 Stock Option Plan and
vest at the rate of 1/3 each month until fully vested. The options granted have
a term of 5 years.




For the
six month period ended December 31, 2009, the Company recognized in the
financial statements, stock-based compensation costs as reflected in the
following table.  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.





The
expected term calculation is based upon the term the option is expected to be
held, which is the full term of the option.  The risk-free interest
rate is based upon the U.S. Treasury yield in effect at the time of grant for an
instrument with a maturity that is commensurate with the expected term of the
stock options.  The dividend yield of zero is based on the fact that
we have never paid cash dividends on our common stock and we have no present
intention to pay cash dividends.  The expected forfeiture rate of 0%
is based on the vesting of stock options in a short period of time.








- 15
-







INFRASTRUCTURE
MATERIALS CORP.


(AN
EXPLORATION STAGE MINING COMPANY)


Condensed
Notes to Interim Consolidated Financial Statements


December
31, 2009


(Amounts
expressed in US Dollars)


(Unaudited-Prepared
by Management)




7.
            Stock
      Based Compensation - Cont’d





10-Apr
                  
                  
                  17-Apr
                  
                  
                  17-May
                  
                  
                  24-Jan
                  
                  
                  2-Apr
                  
                  
                  23-Jun
                  
                  
                  12-Aug
                  
                  
                  11-Dec
                  
                  
                  11-Dec
                  
                  
                  11-Dec
                  
                  
                  19-Dec
                  
                  
                  1-Jan
                  
                  
                  3-Feb
                  
                  
                  5-Jun
                  
                  
                  23-OctDate of grant
                  
                  2007
                  
                  
                  2007
                  
                  
                  2007
                  
                  
                  2008
                  
                  
                  2008
                  
                  
                  2008
                  
                  
                  2008
                  
                  
                  2008
                  
                  
                  2008
                  
                  
                  2008
                  
                  
                  2008
                  
                  
                  2009
                  
                  
                  2009
                  
                  
                  2009
                  
                  
                  2009
                  
                  
                  TotalRisk
      free rate
                  
                  
                  4.50
                  %
                  
                  
                  4.50
                  %
                  
                  
                  4.50
                  %
                  
                  
                  5.00
                  %
                  
                  
                  5.00
                  %
                  
                  
                  5.00
                  %
                  
                  
                  5.00
                  %
                  
                  
                  2.95
                  %
                  
                  
                  2.95
                  %
                  
                  
                  2.95
                  %
                  
                  
                  2.95
                  %
                  
                  
                  2.95
                  %
                  
                  
                  2.95
                  %
                  
                  
                  2.95
                  %
                  
                  
                  2.61
                  %Volatility
      factor
                  
                  
                  50
                  %
                  
                  
                  50
                  %
                  
                  
                  50
                  %
                  
                  
                  50
                  %
                  
                  
                  90.86
                  %
                  
                  
                  111.64
                  %
                  
                  
                  112.99
                  %
                  
                  
                  149.96
                  %
                  
                  
                  149.96
                  %
                  
                  
                  149.96
                  %
                  
                  
                  166.69
                  %
                  
                  
                  168.45
                  %
                  
                  
                  170.57
                  %
                  
                  
                  155.95
                  %
                  
                  
                  156.49
                  %Expected
      dividends
                  
                  
                  0
                  %
                  
                  
                  0
                  %
                  
                  
                  0
                  %
                  
                  
                  0
                  %
                  
                  
                  0
                  %
                  
                  
                  0
                  %
                  
                  
                  0
                  %
                  
                  
                  0
                  %
                  
                  
                  0
                  %
                  
                  
                  0
                  %
                  
                  
                  0
                  %
                  
                  
                  0
                  %
                  
                  
                  0
                  %
                  
                  
                  0
                  %
                  
                  
                  0
                  %
                  
                  
                  -Forfeiture
      rate
                  
                  
                  0
                  %
                  
                  
                  0
                  %
                  
                  
                  0
                  %
                  
                  
                  0
                  %
                  
                  
                  0
                  %
                  
                  
                  0
                  %
                  
                  
                  0
                  %
                  
                  
                  0
                  %
                  
                  
                  0
                  %
                  
                  
                  0
                  %
                  
                  
                  0
                  %
                  
                  
                  0
                  %
                  
                  
                  0
                  %
                  
                  
                  0
                  %
                  
                  
                  0
                  %
                  
                  
                  -Expected
      life
                  
                  5 years
                  
                  
                  5 years
                  
                  
                  5 years
                  
                  
                  5 years
                  
                  
                  5 years
                  
                  
                  5 years
                  
                  
                  5 years
                  
                  
                  5 years
                  
                  
                  5 years
                  
                  
                  5 years
                  
                  
                  1-4 years
                  
                  
                  5 years
                  
                  
                  5 years
                  
                  
                  5 years
                  
                  
                  5 years
                  
                  
                  
                  -Exercise
      price
                  
                  $
                  0.50
                  
                  
                  $
                  0.50
                  
                  
                  $
                  0.50
                  
                  
                  $
                  0.60
                  
                  
                  $
                  0.35
                  
                  
                  $
                  0.52
                  
                  
                  $
                  0.46
                  
                  
                  $
                  0.15
                  
                  
                  $
                  0.25
                  
                  
                  $
                  0.25
                  
                  
                  $
                  0.30
                  
                  
                  $
                  0.15
                  
                  
                  $
                  0.31
                  
                  
                  $
                  0.47
                  
                  
                  $
                  0.33
                  
                  
                  
                  -Total
      number of options granted
                  
                  
                  1,850,000
                  
                  
                  
                  50,000
                  
                  
                  
                  10,000
                  
                  
                  
                  50,000
                  
                  
                  
                  400,000
                  
                  
                  
                  250,000
                  
                  
                  
                  50,000
                  
                  
                  
                  1,950,000
                  
                  
                  
                  50,000
                  
                  
                  
                  50,000
                  
                  
                  
                  1,950,000
                  
                  
                  
                  300,000
                  
                  
                  
                  150,000
                  
                  
                  
                  50,000
                  
                  
                  
                  25,000
                  
                  
                  
                  7,185,000Grant
      date fair value
                  
                  $
                  0.07
                  
                  
                  $
                  0.07
                  
                  
                  $
                  0.07
                  
                  
                  $
                  0.29
                  
                  
                  $
                  0.25
                  
                  
                  $
                  0.42
                  
                  
                  $
                  0.38
                  
                  
                  $
                  0.14
                  
                  
                  $
                  0.13
                  
                  
                  $
                  0.45
                  
                  
                  $
                  0.18-$0.27
                  
                  
                  $
                  0.14
                  
                  
                  $
                  0.29
                  
                  
                  $
                  0.43
                  
                  
                  $
                  0.33
                  
                  
                  
                  -Total
      number of options cancelled/forfeited
                  
                  
                  (1,850,000
                  )
                  
                  
                  (50,000
                  )
                  
                  
                  (10,000
                  )
                  
                  
                  (50,000
                  )
                  
                  
                  (350,000
                  )
                  
                  
                  (250,000
                  )
                  
                  
                  (50,000
                  )
                  
                  
                  (25,000
                  )
                  
                  
                  (50,000
                  )
                  
                  
                  (50,000
                  )
                  
                  
                  (50,000
                  )
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  (2,785,000
                  )Stock-based
      compensation cost expensed during the six month period ended Dec. 31,
      2009
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  $
                  125,167
                  
                  
                  
                  
                  
                  
                  $
                  2,788
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  $
                  22,392
                  
                  
                  $
                  11,041
                  
                  
                  $
                  5,934
                  
                  
                  
                  167,322Unexpended
      Stock-based compensation cost deferred over the vesting
    period
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  $
                  3,304
                  
                  
                  $
                  9,110
                  
                  
                  $
                  1.695
                  
                  
                  $
                  14,109





· Options
originally issued on April 10, 2007 and January 24, 2008 with an exercise price
of $0.50 and $0.60 respectively were cancelled and reissued with an exercise price of $0.30 on December 19, 2008
with all other terms of the original grant remaining the
same.




- 16
-




INFRASTRUCTURE
MATERIALS CORP.


(AN
EXPLORATION STAGE MINING COMPANY)


Condensed
Notes to Interim Consolidated Financial Statements


December
31, 2009


(Amounts
expressed in US Dollars)


(Unaudited-Prepared
by Management)


7.
              Stock
      Based Compensation - Cont'd


The
following table summarizes the options outstanding at December 31,
2009:





Outstanding,
      beginning of year
                  
                  
                  4,639,583Granted/re-issued
                  
                  
                  25,000Forfeited/Cancelled
                  
                  
                  (264,583
                  )Outstanding
      at December 31, 2009
                  
                  
                  4,400,000





As of
December 31, 2009, there was $14,109 of unrecognized expenses related to
non-vested stock-based compensation arrangements granted. The stock-based
compensation expense for the six-month period ended December 31, 2009 was
$167,322.




8.
            Deferred
      Stock Compensation





In fiscal
2008, the Company issued 1,500,000 Shares each to two consultants, for a total
of 3,000,000 Shares valued at $2,250,000.  The Shares issued to the
consultants are considered “restricted” and cannot be resold unless an exemption
from registration is available, such as the exemption afford by Rule 144
promulgated under the Securities Act.  The Company expensed proportionate
consulting expenses of $187,500 during the six months ended December 31, 2009
and $1,125,000 during the year ended June 30, 2009.  Consulting expenses
were fully expensed by the end of December 31, 2009 and are no longer reflected
as a deferred stock compensation expense under Stockholders’ Equity in the
Consolidated Balance Sheet as of December 31, 2009.





9.
              Commitments
      and Contingencies





On August
1, 2006, the Company acquired the Pansy Lee Claims from Anglo Gold Mining Inc.
in exchange for 1,850,000 shares of the Company’s common stock.  The
Company’s interest was acquired pursuant to an Asset Purchase Agreement dated
August 1, 2006 (the “Pansy Lee Purchase Agreement”).  Pursuant to the Pansy
Lee Purchase Agreement, in the event that any one or more claims becomes a
producing claim, the Company’s revenue is subject to a 2% net smelter return
royalty where net smelter returns are based upon gross revenue.  Gross
revenue would be calculated after commercial production commences and includes
the aggregate of the following amounts: revenue received by the Company from
arm’s length purchasers of all mineral products produced from the property, the
fair market value of all products sold by the Company to persons not dealing
with the Company at arms length and the Company’s share of the proceeds of
insurance on products.  From such revenue, the Company would be permitted
to deduct:  sales charges levied by any sales agent on the sale of
products; transportation costs for products; all costs, expenses and charges of
any nature whatsoever which are either paid or incurred by the Company in
connection with the refinement and beneficiation of products after leaving the
property and all insurance costs and taxes.








- 17
-







INFRASTRUCTURE
MATERIALS CORP.


(AN
EXPLORATION STAGE MINING COMPANY)


Condensed
Notes to Interim Consolidated Financial Statements


December
31, 2009


(Amounts
expressed in US Dollars)


(Unaudited-Prepared
by Management)


9.
                Commitments
      and Contingencies - Cont'd


On
September 14, 2007, the Company accepted a proposal from Lumos & Associates
to complete the regulatory permitting process for the Company’s Mill in Mina,
Nevada.  The total consideration to be paid under the contract is
approximately $350,000.  The permitting process is being carried out
in twelve stages. The completion date has not been determined. The Company is
required to authorize in writing each stage of the work before the work
proceeds. As at December 31, 2009, the Company had authorized and paid Lumos and
Associates $301,767 (June 30, 2009 - $134,181).





On April
4, 2008, the Company entered into a Consultant Agreement with Lumos and
Associates, to facilitate the completion of exploration drilling “Notices of
Intent” and Plans of Operation in compliance with the requirements of the United
States Bureau of Land Management. The Company estimates the costs of each Notice
of Intent plan to range from $3,000 to $4,000. Plans of Operation will be priced
separately. During the six months ended December 31, 2009, the Company did not
incur any costs for Notices of Intent. A Plan of Operation for the Blue Nose
Project is projected to cost $10,000.





On May 1,
2008, the Company entered into a Consulting Services Agreement with Lance
Capital Ltd. (“Lance”), at $12,500 per month to provide personnel and
administrative services to carry out the administration of the Company. On
November 1, 2008, the Consulting Services Agreement was amended to reduce the
monthly fee to $10,000 for the months of December 2008 and January 2009 and
thereafter to $7,500. On October 6, 2009 the Company informed Lance Capital Ltd.
of its decision to terminate the agreement with two months notice. It is the
Company’s intention to consolidate the administrative duties being provided by
Lance into its Reno, Nevada office.  It is anticipated that the
transition will be completed in February 2010 and Lance has agreed to continue
providing services as required.





On May
20, 2008, the Company entered into an option agreement (the “Option Agreement”)
with Nevada Eagle Resources, LLC and Steve Sutherland (together, the
“Optionees”) effective as of May 1, 2008 (the “Date of Closing”), to acquire 25
mineral claims located in Elko County, Nevada and known as the “Medicine
Claims.” During the term of the Option Agreement, the Company has the exclusive
right to explore and develop, if warranted, the Medicine Claims.  The
Company paid $10,000 to the Optionees upon execution of the Option Agreement.
 The Option Agreement requires the Company to make additional payments as
follows: $15,000 on the first anniversary of the Date of Closing, $30,000 on the
second anniversary of the Date of Closing, $60,000 on the third anniversary of
the Date of Closing and $80,000 on each anniversary of the Date of Closing
thereafter until the tenth anniversary of the Date of Closing. The Optionees may
elect to receive payment in cash or in Shares. Upon making the final payment on
the tenth anniversary of the Date of Closing, the Company will have earned a
100% undivided interest in the Medicine Claims. On April 7, 2009, the Company
and the Optionees amended the Option Agreement. This amendment reduced the
option payment due on May 1, 2009 from $15,000 to $10,000 and increased the
payment due May 1, 2010 from $30,000 to $35,000.








- 18
-




INFRASTRUCTURE
MATERIALS CORP.


(AN
EXPLORATION STAGE MINING COMPANY)


Condensed
Notes to Interim Consolidated Financial Statements


December
31, 2009


(Amounts
expressed in US Dollars)


(Unaudited-Prepared
by Management)


9.
                  Commitments
      and Contingencies - Cont'd


Pursuant
to the Option Agreement, the Medicine Claims are subject to a 3% net smelter
return (“NSR”) royalty payable to the Optionees.  The payments made during
the term of the Option Agreement are to be applied as advance NSR royalty
payments. Beginning on the eleventh anniversary of the Date of Closing, the
Company is required to make annual advance royalty payments of $80,000. At such
time as the Medicine Claims are in production, if ever, the Company shall make
annual royalty payments equal to the greater of the actual 3% NSR or $80,000.
 The Company may terminate the Option Agreement at any time before the
option is fully exercised upon 60 days notice to the Optionees. The Company
does not consider the Medicine Claims to be material assets at this time;
however this assessment may change upon further exploration.





Effective
as of June 23, 2008, the Company appointed Mason Douglas as the President of the
Company. Mr. Douglas is also a director of the Company. In connection with the
appointment, the Company entered into a consulting services agreement with a
corporation that is controlled by Mr. Douglas (the “Consulting Agreement”). The
Consulting Agreement has a term of one year and is then automatically renewable.
Either party may terminate the Consulting Agreement upon 90 days notice to the
other party. During the term of the Consulting Agreement the Company will pay a
fee of $8,500 per month and reimburse related business expenses. Mr. Douglas
does not receive a salary from the Company.





On
December 8, 2008 IMC US entered into a Mineral Rights Lease Agreement (the
“Lease Agreement”) with the Earl Edgar Mineral Trust (the “Lessor”) to lease
certain mineral rights in Elko County, Nevada.  The term of the Lease
Agreement is ten years and will automatically renew on the same terms and
conditions for additional ten-year periods, provided the Company is conducting
exploration, development or mining either on the surface or underground at the
property.  The rent is to be paid each year on January
1st.





$1.00 per
net acre was paid upon execution of the Lease Agreement. On January 1, of
each year commencing in 2010 and extending for so long as the Lease Agreement is
in effect the Company is obligated to make the following payments
during:




2010
                  
                  $1.00
      per net acre2011
                  
                  $2.00
      per net acre2012
                  
                  $2.00
      per net acre2013
                  
                  $3.00
      per net acre2014
                  
                  $3.00
      per net acre2015
                  
                  $4.00
      per net acre2016
                  
                  $4.00
      per net acre2017
                  
                  $5.00
      per net acre in each year for the duration of the Lease
      Agreement.








- 19
-




INFRASTRUCTURE
MATERIALS CORP.


(AN
EXPLORATION STAGE MINING COMPANY)


Condensed
Notes to Interim Consolidated Financial Statements


December
31, 2009


(Amounts
expressed in US Dollars)


(Unaudited-Prepared
by Management)




9.
                Commitments
      and Contingencies - Cont'd


The Lease
Agreement covers 100% of the mineral rights on 1,120 acres (“Property A”) and
50% of the mineral rights on 6,740 acres (“Property B”).





The
Lessor is entitled to receive a royalty of $0.50 per ton for material mined and
removed from Property A and $0.25 per ton for material mined and removed from
Property B during the term of the Lease Agreement and any renewal
thereof.





On April
9, 2009 the Board of Directors approved an Amendment to the Lease Agreement
(the “Amendment”), effective as of December 8, 2008.  The
Amendment provides for Standard Steam LLC to carry out exploration for
geothermal energy sources on the leased mineral rights property after obtaining
the written consent of the Company.  The Amendment also provides for
other cooperation with Standard Steam LLC regarding mineral rights on the
properties in which the Company holds a 50% interest in the mineral
rights.





Effective
as of January 1, 2009, the Company entered into a Consulting Agreement with
Scott Koyich (the “Consultant”) for a period of six months, which was extended
on June 29, 2009 to December 31, 2009 to provide consulting services with
respect to financial public relations, business promotion, business growth and
development.  On September 14, 2009, this agreement was terminated,
effective as of October 15, 2009. The Consultant was paid $5,000 per month for
his services during the term of the Agreement and was granted options to acquire
300,000 Shares at $0.15 per Share for a term of five years. These options vested
at the rate of 50,000 options per month and all options had vested by the
termination of the agreement. The expiry of the options was extended to October
15, 2010.





On
February 23, 2009, the Board of Directors approved a drilling contract with
Harris Exploration Drilling and Associates Inc. dated February 25, 2009, to
carry out up to 30,000 feet of drilling programs in Nevada. The Company will pay
$12.00 per foot for drilling plus various other costs related to mobilization
and demobilization, travel, down time and moving time, plus other costs
dependant on conditions and supplies. The Company paid a $25,000 refundable
deposit upon execution of the contract to be applied to the final invoice.
During the six-month period ended December 31, 2009, the Company paid Harris
Exploration Drilling $229,394 to complete 9,290 feet of drilling. During
the year ended June 30, 2009, the Company paid Harris Exploration Drilling
$223,265 to complete 10,495 feet of drilling.





On April
24, 2009, IMC US entered into a consulting agreement with PHW Consulting
(“PHW).  PHW is to provide collection, analysis and interpretation of
data pertaining to mineral claims in Clark and Lincoln counties of Nevada owned
by IMC US.  PHW is also required to write and submit Canadian National
Instrument 43-101 compliant Technical Reports on the Morgan Hill, Project in
Elko County and the Blue Nose Project in Lincoln County, both in the State of
Nevada.  The cost is $15,000 for each NI 43-101 compliant technical
report plus $500.00 per day and out-of-pocket expenses for data collection,
analysis and interpretation.  As of December 31, 2009 the Company paid
$15,150 for the 43-101 report on the Morgan Hill, Project in Elko County and
$12,943 for data collection and out-of-pocket expenses.








- 20
-







INFRASTRUCTURE
MATERIALS CORP.


(AN
EXPLORATION STAGE MINING COMPANY)


Condensed
Notes to Interim Consolidated Financial Statements


December
31, 2009


(Amounts
expressed in US Dollars)


(Unaudited-Prepared
by Management)


9.
                  Commitments
      and Contingencies - Cont'd


On May
20, 2009, IMC US hired Lumos & Associates to conduct base line studies
for the Blue Nose Project located in Lincoln County, Nevada with the intention
of determining if a suitable plant site can be located.  The study
will include analysis of rail and road access and environmental considerations
that could impede development.  The total consideration to be paid
under the contract is approximately $74,500. The Company has to authorize each
phase of the work. The Company paid Lumos & Associates $42,794 during the
six-months ended December 31, 2009 and $9,952 during the year ended June 30,
2009.





On
November 30, 2009, the Company entered into a consulting services agreement with
CLL Consulting, LLC (“CLL”) to provide for business and administrative services.
The Consulting Agreement has a term of one year and is automatically renewable
thereafter. Either party may terminate the Consulting Agreement upon 60 days
notice. During the term of the Consulting Agreement the Company will pay CLL a
fee of $6,083 per month and reimburse related business expenses. CLL received
$6,586 during the period ended December 31, 2009.





On
November 30, 2009 IMC US entered into a Mineral Rights  Agreement with
Perdriau Investment Corp. (“Perdriau”) to purchase 50% of the mineral
rights, including all easements, rights of way and appurtenant rights of any
type that run with the mineral rights in certain sections of Elko County, Nevada
(the “Property”).  The purchase price was $10 per net acre for 340 net
acres for a total purchase price of $3,400. Perdriau will be entitled to receive
a royalty of $0.25 per ton for material mined and removed from the Property.
Material mined and stored on the Property or adjacent property for reclamation
purposes will not be subject to any royalty. Material removed from the Property
for the purposes of testing or bulk sampling, provided it does not exceed 50,000
tons, will also not be subject to any royalty.  The royalty will be
calculated and paid within 45 days after the end of each calendar
quarter.





In
November 2009, the Company made a decision to expand its area of exploration to
include cement grade limestone properties located in Manitoba,
Canada.  The Company entered into an agreement to acquire, as a
wholly-owned subsidiary, Canadian Infrastructure Corp. (“CIC”), a Canadian
corporation, pursuant to a Share Exchange Agreement (the “Agreement”) between
the Company, CIC and Todd D. Montgomery dated as of December 15, 2009. Mr.
Montgomery is the sole shareholder of CIC in addition to serving as the
Company’s Chief Executive Officer and as a member of its Board of
Directors.  The Agreement was approved by the disinterested members of
the Company’s Board of Directors on November 27, 2009.  Under the
terms of the Agreement, the Company acquired all of the issued and outstanding
stock of CIC in exchange for 1,021,777 Shares at the agreed upon price of $0.40
per Share.  The total price of $408,710.90 represented Mr.
Montgomery’s cost of forming CIC, assembling the limestone properties and
obtaining exploration work and reports on the properties.  The
purchase price was significantly below an independent valuation.. The Agreement
was initially expected to close on January 1, 2010, but was extended by an
addendum dated January 14, 2010 and closed on February 9, 2010. The transaction
will be measured at the fair value, being the market value of the Shares on
the date of the Share Exchange Agreement, which was $0.20 per
Share.  CIC controls 94 quarry leases issued by the Province of
Manitoba, Canada, covering 6,090.052 hectares (15,048,846 acres) requiring
annual rental payments of  $143,465 (CAD $150,782).  See
Note 11, Subsequent Events.








- 21
-







INFRASTRUCTURE
MATERIALS CORP.


(AN
EXPLORATION STAGE MINING COMPANY)


Condensed
Notes to Interim Consolidated Financial Statements


December
31, 2009


(Amounts
expressed in US Dollars)


(Unaudited-Prepared
by Management)


9.
                  Commitments
      and Contingencies - Cont'd




The
Company is required to pay to the Department of Interior Bureau of Land
Management (“BLM”) on or before August 31st of each
year, a fee in the amount of $140 per mineral claim held by the
Company.  The total amount paid on August 31, 2009 was $172,620 for
1,233 claims held by the Company at that date.  During the six-month
period ended December 31, 2009, the Company acquired 436 mineral claims in
Lincoln County, Nevada and 44 mineral claims in Pershing County,
Nevada. Four mineral claims in Elko County, Nevada were
abandoned.





The
Company is also required to pay annual fees to counties in which the claims are
held.  At August 31, 2009, the Company paid $12,356 to nine counties
in Nevada.





The
Company also holds 9 patented claims and 2 leased patented claims in
Nevada.  A patented claim is fee simple title to the
property.  Patented claims are subject to taxes assessed by the local
community based on assessment rates set annually.





By letter
dated November 27, 2009, the U.S. Attorney’s Office asked for contribution from
the Company for the cost of putting out a fire that occurred on May 8, 2008 on
approximately 451 acres of land owned by the BLM.  The cost of putting
out the fire and rehabilitating the burned area was approximately
$550,000.  The Company has denied any responsibility for the fire and
has alerted its liability insurance carrier. The Company has not accrued any
costs for this claim in its financial statements.





10.
            Related
      Party Transactions





Sixmonths endedDecember 31, 2009





Roger M.
Hall, former Chief Operating officer and member of the Company’s Board of
Directors, received $85,390 in connection with services he performed for the
Company as a senior geologist during the six-month period ended December
31, 2009.




Joanne
Hughes served as Corporate Secretary and received $22,746 during the
six-month period ended December 31, 2009




A company
owned and operated by Mason Douglas, President and a member of the Company’s
Board of Directors, received $51,000during the six-month
period ended December 31, 2009.





- 22
-




INFRASTRUCTURE
MATERIALS CORP.


(AN
EXPLORATION STAGE MINING COMPANY)


Condensed
Notes to Interim Consolidated Financial Statements


December
31, 2009


(Amounts
expressed in US Dollars)


(Unaudited-Prepared
by Management)


10.
              Related
      Party Transactions - Cont'd


Rakesh
Malhotra, Chief Financial Officer of the Company, received $4,749. during the
six-month period ended December 31, 2009.




Sixmonths endedDecember 31, 2008




Roger M.
Hall, former Chief Operating Officer and a member of the Company’s Board of
Directors , received $86,318 in connection with services he performed for the
Company as a senior geologist during the six-month period ended December 31,
2008.




Janet
Shuttleworth, former Treasurer and Corporate Secretary, was paid $27,476. Ms.
Shuttleworth resigned on December 31, 2008.




Joanne
Hughes, Corporate Secretary, received $4,110 from July 1, 2008 to July 30, 2008
(date of resignation).  Ms. Hughes was re-appointed as Corporate
Secretary on January 1, 2009.




A Company
owned by  Mason Douglas, a member of the Company’s Board of Directors
and President, was paid $51,000 during the six-month period ended December
31, 2008.





11.
              Subsequent
      Events





The
Company has reviewed subsequent events up to February 12, 2010. Subsequent
events are as follows.





On
January 12, 2010, the Company entered into an agreement with Railroad Industries
Incorporated to prepare a market analysis for calcium carbonate, quicklime and
other materials marketable from high grade limestone deposits for the regions of
Central Canada and Western Unites States.  The cost of the study is
estimated to be between $28,875 and $39,900, depending on the number of hours
required. The Company paid a $5,000 refundable deposit upon execution of
the contract to be applied to the final invoice.





On
January 15, 2010, Roger M. Hall resigned as the Company’s Chief Operating
Officer and as a member of the Company’s Board of Directors.  Mr. Hall
subsequently resigned as Vice President - Exploration of IMC US.  As
of January 12, 2010 the  Company terminated its Independent Contractor
Agreement with Mr. Hall dated April 1, 2007. Both parties waived any applicable
notice periods and the termination was effective immediately.  As
consideration for his services, stock options previously granted to Mr. Hall
were extended and will expire as follows: 200,000 options to acquire Shares at
$0.15 per Share will expire on April 15, 2010; 200,000 options to acquire
Shares  at $0.15 per Share will expire on December 10, 2013 and
250,000 to acquire Shares  at $0.30 per Share will expire on April 9,
2012 There were no disagreements between Mr. Hall and the Company with respect
to  with the Company’s management, policies, procedures, internal
controls or public disclosure documents.




- 23
-




INFRASTRUCTURE
MATERIALS CORP.


(AN
EXPLORATION STAGE MINING COMPANY)


Condensed
Notes to Interim Consolidated Financial Statements


December
31, 2009


(Amounts
expressed in US Dollars)


(Unaudited-Prepared
by Management)


11.
                Subsequent
      Events - Cont'd


On
January 15, 2010, the Company entered into an “Independent Contractor Agreement”
with Karl Frost. Mr. Frost was given the title of Chief Geologist
and  will be responsible for the preparation and oversight of all
geological programs and activities. The Independent Contractor Agreement has a
term of one year and is automatically renewable thereafter. Either party may
terminate the agreement upon 60 days notice or in the case of breach or default
with 5 days of written notice. During the term of the agreement the Company will
pay Mr. Frost a fee of $12,500 per month and reimburse him for related business
expenses. In addition, during the first term of this agreement, the Company
granted Mr. Frost an option to purchase 250,000 common shares of the
Company at an exercise price of $0.25 per share. These options were granted
in accordance with the terms of the Company’s 2006 Stock Option Plan and vest at
the rate of 1/12 each month until fully vested. The options granted have a term
of 5 years.





On
January 15, 2010, the Company entered into a Property Lease Agreement (the
“Lease Agreement”) with the Eugene M. Hammond to lease the surface rights
on 80 acres of vacant land located in Elko County, Nevada.  The term
of the Lease Agreement is five years with an option in favor of IMC US to
purchase the property. IMC US will pay rent of $500 on the anniversary date for
so long as this Lease is in effect.





On
January 15, 2010, the Company entered into a Mineral Rights Agreement with
Eugene M. Hammond. to purchase 25% of the mineral rights, including all
easements, rights of way and appurtenant rights of any type that run with the
mineral rights on 80 acres of vacant land in certain sections of Elko County,
Nevada (the “Property”).  The purchase price was $10 per net acre for
a total purchase price of $200.





Eugene M.
Hammond will be entitled to receive a royalty of $0.125 per ton for material
mined and removed from the Property. Material mined and stored on the Property
or adjacent property for reclamation purposes will not be subject to any
royalty. Material removed from the Property for the purposes of testing or bulk
sampling, provided it does not exceed 50,000 tons, will also not be subject to
any royalty.  The royalty will be calculated and paid within 45 days
after the end of each calendar quarter.





Two
additional projects with 200 mineral claims in Elko County, Nevada were
recorded. IMC US submitted to the State of Arizona applications for leases
on 18 sections or portions of sections.





As of
February 1, 2010, the Company entered into a Consulting Services Agreement to
provide for receptionist and administrative services at its Reno, Nevada
corporate headquarters.  Pursuant to this Agreement, the Company will
pay $51,000 per year for such services.  The Agreement is terminable
by either party upon 30 days prior notice.





On
February 9, 2010 the Company completed the acquisition of Canadian
Infrastructure Corp. (“CIC”).  CIC holds three limestone properties
located in southern Manitoba, Canada.  These properties consist of 94
quarry leases issued by the Province of Manitoba, Canada covering 6,090.052
hectares (15,048,846 acres).  The transaction will be measured at the fair
value, being the market value of the Shares on the date of the Share
Exchange Agreement, which was $0.20 per Share.


- 24
-





MANAGEMENT'S
DISCUSSION AND ANALYSIS OF


FINANCIAL
CONDITION AND RESULTS OF OPERATION





Forward-Looking
Statements




Except
for historical information, this report contains forward-looking statements
within the meaning of Section 27A of the Securities Act of 1933 and Section 21E
of the Securities Exchange Act of 1934.  Such forward-looking statements
involve risks and uncertainties, including, among other things, statements
regarding our business strategy, exploration strategy, future revenues and
anticipated costs and expenses.  Such forward-looking statements include,
among others, those statements including the words “expects,” “anticipates,”
“intends,” “believes” and similar language.  Our actual results may differ
significantly from those projected in the forward-looking statements.
 Factors that might cause or contribute to such differences include, but
are not limited to, those discussed herein as well as in the “RISK FACTORS”
section herein.   You are cautioned not to place undue reliance on the
forward-looking statements, which speak only as of the date of this
report.  We undertake no obligation to publicly release any revisions
to the forward-looking statements or reflect events or circumstances after the
date of this document.




Although
we believe that the expectations reflected in these forward-looking statements
are based on reasonable assumptions, there are a number of risks and
uncertainties that could cause actual results to differ materially from such
forward-looking statements.




FOR
THE SIX MONTH AND THREE MONTH PERIODS ENDED DECEMBER 31, 2009





PLAN OF
OPERATIONS





We will
require additional capital to implement the further exploration and possible
development of our claim groups.  We expect to raise this capital
through private placements of our securities or through debt
financing or some combination of the foregoing.  We have limited
assets and no “reserves” in accordance with the definitions adopted by the
Securities and Exchange Commission, and there is no assurance that any
exploration programs that we undertake will establish reserves.





Discussion
of Operations and Financial Condition





Six
Month and Three Month Periods ended December 31, 2009





The
Company has no source of revenue and we continue to operate at a
loss.  We expect our operating losses to continue for so long as we
remain in an exploration stage and perhaps thereafter.  As at December
31, 2009, we had accumulated losses since the Company’s inception of
$14,719,529.  Our ability to emerge from the exploration stage and
conduct mining operations is dependent, in large part, upon our raising
additional capital.  We are continuing our efforts to raise capital
and are moving forward with development of our projects.




- 25
-


In
November of 2008, the Company substantially changed its business focus to the
exploration and development of cement grade limestone properties and acquired
Infrastructure Materials Corp. US with limestone properties located in the
states of Nevada and  Idaho.  In December of 2008, the
Company changed its name to Infrastructure Materials Corp.  We have
identified and recorded 1,295 claims on Department of Interior Bureau of Land
Management (“BLM”) land covering twelve projects in Nevada
and  63 claims covering one project in Idaho.  We have
applied to the State of Arizona for leases on 18 sections or portions of
sections covering two additional projects.  On private land we acquired
100% of the Mineral Rights on 1,120 acres, 50% of the Mineral Rights on 7,080
acres, all of which have potential for cement grade
limestone.  Exploration on these limestone properties indicates that
the Morgan Hill Project and the Blue Nose Project have potential for development
of substantial cement grade limestone resources.  Our efforts going
forward through our current fiscal year ending June 30, 2010, will be
concentrated on development of the Blue Nose Project and the search for other
limestone deposits in strategic locations that can service areas with a shortage
of cement production.





The
Company’s major endeavor during the six months ended December 31, 2009 has been
its effort to pursue exploration activities on its limestone
claims.  We have also completed the evaluation of all our silver/base
metal projects and determined that the Pansy Lee, Medicine, Silver Queen and
Nivloc Projects provide the best opportunity for development of resources that
could go to production. Permitting of the Red Rock mill site at Mina, Nevada is
close to completion.  The Company transferred incorporated a wholly
owned subsidiary, Silver reserve Corp in December of 2008 and transferred all of
the silver/base metal projects and the mill the this subsidiary. We are
attempting to secure a sale of its silver properties and milling facility held
by its subsidiary, Silver Reserve Corp.





The
following diagram illustrates the Company’s present structure and ownership of
its mineral properties and Milling Facility:











Stock Based
Compensation





On
September 14, 2009 the Company terminated its consulting services agreement with
a consultant effective as of October 15, 2009 and extended the expiry of
his options from his termination date to October 15, 2010.





On
October 23, 2009, the Company granted options to a consultant to
purchase 25,000 common shares at an exercise price of $0.33 per share.
 These options were granted in accordance with the terms of the Company’s
2006 Stock Option Plan and vest at the rate of 1/3 each month until fully
vested. The options granted are for a term of 5 years.




- 26
-




SELECTED FINANCIAL
INFORMATION





Three months ended
                    
                    
                    Three months endedDec. 31, 2009
                    
                    
                    Dec. 31, 2008Revenues
                    
                    $
                    Nil
                    
                    
                    $
                    NilNet
      Loss
                    
                    $
                    1,024,011
                    
                    
                    $
                    1,721,105Loss
      per share-basic and diluted
                    
                    $
                    0.02
                    
                    
                    $
                    0.03





Six months ended
                    
                    
                    Six months endedDec. 31, 2009
                    
                    
                    Dec. 31, 2008Revenues
                    
                    $
                    Nil
                    
                    
                    $
                    NilNet
      Loss
                    
                    $
                    2,289,880
                    
                    
                    $
                    3,128,343Loss
      per share-basic and diluted
                    
                    $
                    0.04
                    
                    
                    $
                    0.06





As at
                    
                    
                    As atDec. 31, 2009
                    
                    
                    June 30, 2009Total
      Assets
                    
                    $
                    2,965,715
                    
                    
                    $
                    4,884,471Total
      Liabilities
                    
                    $
                    287,203
                    
                    
                    $
                    270,901Cash
      dividends declared per share
                    
                    $
                    Nil
                    
                    
                    $
                    Nil





The total
assets as of December 31, 2009 include cash and cash equivalents
of $183,394, short term investments of $1,534,147, prepaid expenses and
other receivables of $191,191 and capital assets of $1,056,983, net of
depreciation.  As of June 30, 2009 total assets includes cash and cash
equivalents of $420,266, short-term investments of $3,116,803, prepaid expenses
of $205,482 and capital assets of $1,141,920, net of depreciation.





Revenues





No
revenue was generated by the Company’s operations during the three-month and
six-month periods ended December 31, 2009 and December 31,
2008.





Net
Loss





The
Company is an exploration stage mining company and has not yet realized any
revenue from its operations.  It is primarily engaged in the
acquisition and exploration of mineral properties. Mineral property acquisition
costs are initially capitalized when incurred in accordance with ASC
805-20-55-37, previously referenced as the FASB Emerging Issues Task Force
("EITF") Issue 04-2.  The Company assesses the carrying costs for
impairment under ASC 930 at each fiscal quarter end.  When it has been
determined that a mineral property can be economically developed as a result of
establishing proven and probable reserves, the costs incurred to develop such
property will be capitalized.  The Company has determined that all
property payments are impaired and accordingly has written off the acquisition
costs to project expenses.  Once capitalized, such costs will be
amortized using the units-of-production method over the estimated life of the
probable reserve.




- 27
-


To date,
mineral property exploration costs have been expensed as incurred.  To
date the Company has not established any proven or probable reserves on its
mineral properties.





The
Company’s expenses are reflected in the Statements of Operation under the
category of Operating Expenses.





The
significant components of expense that have contributed to the total operating
expense are discussed as follows:





(a)General and AdministrativeExpense





Included
in operating expenses for the three-month period ended December 31, 2009 is
general and administrative expense of $429,114, as compared with $1,116,784 for
the three-month period ended December 31, 2008. During the six-month period
ended December 31, 2009 the general and administrative expense was $878,310, as
compared to $1,851,144 for the six month period ended December 31, 2008. General
and administrative expense represents approximately 38% of the total operating
expense for the six-month period ended December 31, 2009 and approximately 59%
of the total operating expense for the six-month period ended December 31, 2008.
General and administrative expense represents professional, consulting, office
and general and other miscellaneous costs incurred during the six-month and
three month periods ended December 31, 2009 and December 31, 2008. General and
administrative expense decreased by $972,834 in the current six month period, as
compared to the similar six month period for the prior year. The decrease in
this expense is mainly due to a decrease in consulting fees of $461,000, and a
decrease in stock based compensation costs of $427,290.





(b) Project
Expense





Included
in operating expenses for the three-month period ended December 31, 2009 is
project expense of $561,082 as compared with $565,506 for the three-month period
ended December 31, 2008. During the six month period ended December 31, 2009,
the project expense was $1,346,853 as compared to $1,197,178 during the six
month period ended December 31, 2008. Project expense is a significant expense
and it represents approximately 58% of the total operating expense for the
six-month period ended December 31, 2009 and approximately 38% of the total
operating expense for the six-month period ended December 31,
2008.


- 28
-


Liquidity
and Capital Resources





The
following table summarizes the Company’s cash flow and cash in hand for the six
month periods:





Dec. 31, 2009
                  
                  
                  Dec. 31, 2008Cash
      and cash equivalents
                  
                  $
                  183,394
                  
                  
                  $
                  3,003,916Working
      capital
                  
                  $
                  1,621,529
                  
                  
                  $
                  2,933,458Cash
      used in operating activities
                  
                  $
                  1,814,097
                  
                  
                  $
                  1,914,034Cash
      provided (used) in investing activities
                  
                  $
                  1,577,225
                  
                  
                  $
                  (8,905
                  )Cash
      provided by financing activities
                  
                  $
                  nil
                  
                  
                  $
                  3,373,000





As at
December 31, 2009 the Company had working capital of $1,621,529 as compared to
$2,933,458 as at December 31, 2008.





Off-Balance
Sheet Arrangements





The
Company had no off-balance sheet arrangements as of December 31, 2009 and
December 31, 2008.





Contractual
Obligations and Commercial Commitments





On August
1, 2006, the Company acquired the Pansy Lee Claims from Anglo Gold Mining Inc.
in exchange for 1,850,000 shares of the Company’s common stock.  The
Company’s interest was acquired pursuant to an Asset Purchase Agreement dated
August 1, 2006 (the “Pansy Lee Purchase Agreement”).  Pursuant to the Pansy
Lee Purchase Agreement, in the event that any one or more claims becomes a
producing claim, the Company’s revenue is subject to a 2% net smelter return
royalty where net smelter returns are based upon gross revenue.  Gross
revenue would be calculated after commercial production commences and includes
the aggregate of the following amounts: revenue received by the Company from
arm’s length purchasers of all mineral products produced from the property, the
fair market value of all products sold by the Company to persons not dealing
with the Company at arms length and the Company’s share of the proceeds of
insurance on products.  From such revenue, the Company would be permitted
to deduct:  sales charges levied by any sales agent on the sale of
products; transportation costs for products; all costs, expenses and charges of
any nature whatsoever which are either paid or incurred by the Company in
connection with the refinement and beneficiation of products after leaving the
property and all insurance costs and taxes.





On
September 14, 2007 the Company accepted a proposal from Lumos & Associates
to complete the regulatory permitting process for the Company’s Mill in Mina,
Nevada.  The total consideration to be paid under the contract is
approximately $350,000.  The permitting process is being carried out
in twelve stages. The completion date has not been determined. The Company is
required to authorize in writing each stage of the work before the work
proceeds. As at December 31, 2009, the Company had authorized and paid Lumos and
Associates $301,767 (June 30, 2009 - $134,181).





On April
4, 2008, the Company entered into a Consultant Agreement with Lumos and
Associates, to facilitate the completion of exploration drilling “Notices of
Intent” and “Plans of Operation” in compliance with the requirements of the
United States Bureau of Land Management. The Company estimates the costs of each
Notice of Intent plan to range from $3,000 to $4,000. Plans of Operation will be
priced separately. During the six months ended December 31, 2009 the Company did
not incur any costs for Notices of Intent. A Plan of Operation for the Blue Nose
Project is projected to cost $10,000.




- 29
-


On May 1,
2008, the Company entered into a Consulting Services Agreement with Lance
Capital Ltd. (“Lance”), at $12,500 per month to provide personnel and
administrative services to the Company. On November 1, 2008, the Consulting
Services Agreement was amended to reduce the monthly fee to $10,000 for the
months of December 2008 and January 2009 and thereafter to $7,500. On October 6,
2009 the Company informed Lance Capital Ltd. of its decision to terminate the
agreement with two months notice. It is the Company’s intention to consolidate
the administrative duties being provided by Lance into its Reno, Nevada
office.  It is anticipated that the transition will be completed in
February 2010 and Lance has agreed to continue providing services as
required.





On May
20, 2008, the Company entered into an option agreement (the “Option Agreement”)
with Nevada Eagle Resources, LLC and Steve Sutherland (together, the
“Optionees”) effective as of May 1, 2008 (the “Date of Closing”), to acquire 25
mineral claims located in Elko County, Nevada and known as the “Medicine
Claims.” During the term of the Option Agreement, the Company has the exclusive
right to explore and develop, if warranted, the Medicine Claims.  The
Company paid $10,000 to the Optionees upon execution of the Option Agreement.
 The Option Agreement requires the Company to make additional payments as
follows: $15,000 on the first anniversary of the Date of Closing, $30,000 on the
second anniversary of the Date of Closing, $60,000 on the third anniversary of
the Date of Closing and $80,000 on each anniversary of the Date of Closing
thereafter until the tenth anniversary of the Date of Closing. The Optionees may
elect to receive payment in cash or in Shares. Upon making the final payment on
the tenth anniversary of the Date of Closing, the Company will have earned a
100% undivided interest in the Medicine Claims. On April 7, 2009, the Company
and the Optionees amended the Option Agreement. This amendment reduced the
option payment due on May 1, 2009 from $15,000 to $10,000 and increased the
payment due May 1, 2010 from $30,000 to $35,000.





Pursuant
to the Option Agreement, the Medicine Claims are subject to a 3% net smelter
return (“NSR”) royalty payable to the Optionees.  The payments made during
the term of the Option Agreement are to be applied as advance NSR royalty
payments. Beginning on the eleventh anniversary of the Date of Closing, the
Company is required to make annual advance royalty payments of $80,000. At such
time as the Medicine Claims are in production, if ever, the Company shall make
annual royalty payments equal to the greater of the actual 3% NSR or $80,000.
 The Company may terminate the Option Agreement at any time before the
option is fully exercised upon 60 days notice to the Optionees. The Company
does not consider the Medicine Claims to be material assets at this time;
however this assessment may change upon further exploration.





Effective
as of June 23, 2008, the Company appointed Mason Douglas as the President of the
Company. Mr. Douglas is also a director of the Company. In connection with the
appointment, the Company entered into a consulting services agreement with a
corporation that is controlled by Mr. Douglas (the “Consulting Agreement”). The
Consulting Agreement has a term of one year and is then automatically renewable.
Either party may terminate the Consulting Agreement upon 90 days notice to the
other party. During the term of the Consulting Agreement the Company will pay
the corporation that is controlled by Mr. Douglas a fee of $8,500 per month and
reimburse related business expenses. Mr. Douglas does not receive a salary from
the Company.




- 30
-


On
December 8, 2008 IMC US entered into a Mineral Rights Lease Agreement (the
“Lease Agreement”) with the Earl Edgar Mineral Trust (the “Lessor”) to lease
certain mineral rights in Elko County, Nevada.  The term of the Lease
Agreement is ten years and will automatically renew on the same terms and
conditions for additional ten-year periods, provided the Company is conducting
exploration, development or mining either on the surface or underground at the
property.  The rent is to be paid each year on January
1st.  $1.00 per net acre was paid upon execution of the Lease
Agreement. On January 1, of each year commencing in 2010 and extending for
so long as the Lease Agreement is in effect the Company is obligated to make the
following payments during:




2010
                  $1.00
      per net acre2011
                  $2.00
      per net acre2012
                  $2.00
      per net acre2013
                  $3.00
      per net acre2014
                  $3.00
      per net acre2015
                  $4.00
      per net acre2016
                  $4.00
      per net acre2017
                  $5.00
      per net acre in each year for the duration of the Lease
      Agreement.




The Lease
Agreement covers 100% of the mineral rights on 1,120 acres (“Property A”) and
50% of the mineral rights on 6,740 acres (“Property B”).  The Lessor
is entitled to receive a royalty of $0.50 per ton for material mined and removed
from Property A and $0.25 per ton for material mined and removed from Property B
during the term of the Lease Agreement and any renewal thereof.





On April
9, 2009 the Board of Directors approved an amendment to the Lease Agreement (the
“Amendment”), effective as of December 8, 2008.  The Amendment
provides for Standard Steam LLC to carry out exploration for geothermal energy
sources on the leased mineral rights property after obtaining the written
consent of the Company.  The Amendment also provides for other
cooperation with Standard Steam LLC regarding mineral rights on the properties
which the Company holds a 50% interest in the mineral rights.





Effective
as of January 1, 2009, the Company entered into a Consulting Agreement with
Scott Koyich (the “Consultant”) for a period of six months, which was extended
on June 29, 2009 to December 31, 2009 to provide consulting services with
respect to financial public relations, business promotion, business growth and
development.   On September 14, 2009 this agreement was
terminated, effective as of October 15, 2009. The Consultant was paid $5,000 per
month for his services during the term of the Agreement and was granted options
to acquire 300,000 Shares at $0.15 per Share for a term of five years. These
options vested at the rate of 50,000 options per month and all options had
vested by the termination of the agreement. The expiry of the options was
extended to October 15, 2010.





On
February 23, 2009, the Board of Directors approved a drilling contract with
Harris Exploration Drilling and Associates Inc. dated February 25, 2009, to
carry out up to 30,000 feet of drilling programs in Nevada. The Company will pay
$12.00 per foot for drilling plus various other costs related to mobilization
and demobilization, travel, down time and moving time, plus other costs
dependant on conditions and supplies. The Company paid a $25,000 refundable
deposit upon execution of the contract to be applied to the final invoice.
During the six-month period ended December 31, 2009, the Company paid Harris
Exploration Drilling $229,394 to complete 9,290 feet of drilling. During
the year ended June 30, 2009, the Company paid Harris Exploration Drilling
$223,265 to complete 10,495 feet of drilling.




- 31
-


On April
24, 2009, IMC US entered into a consulting agreement with PHW Consulting
(“PHW).  PHW is to provide collection, analysis and interpretation of
data pertaining to mineral claims in Clark and Lincoln counties of Nevada owned
by IMC US.  PHW is also required to write and submit Canadian National
Instrument 43-101 compliant Technical Reports on the Morgan Hill, Project in
Elko County and the Blue Nose Project in Lincoln County, both in the State of
Nevada.  The cost is $15,000 for each NI 43-101 compliant technical
report plus $500.00 per day and out—of=pocket expenses for data collection,
analysis and interpretation As of December 31, 2009 the Company paid $15,150 for
the 43-101 report on the Morgan Hill, Project in Elko County and $12,943 for
data collection and out-of-pocket expenses.





On May
20, 2009, IMC US hired Lumos & Associates to conduct base line studies
for the Blue Nose Project located in Lincoln County, Nevada with the intention
of determining if a suitable plant site can be located. The study will include
analysis of rail and road access and environmental considerations that could
impede development.  The total consideration to be paid under the
contract is approximately $74,500. The Company has to authorize each phase of
the work. The Company paid Lumos & Associates $42,794 during the six-months
ended December 31, 2009 and $9,952 during the year ended June 30,
2009.





On
November 30, 2009, the Company entered into a consulting services agreement with
CLL Consulting, LLC (“CLL”) to provide for business and administrative services.
The Consulting Agreement has a term of one year and is automatically renewable
thereafter. Either party may terminate the Consulting Agreement upon 60 days
notice. During the term of the Consulting Agreement the Company will pay CLL a
fee of $6,083 per month and reimburse related business expenses. CLL received
$6,586 during the period ended December 31, 2009.





On
November 30, 2009 IMC US entered into a Mineral Rights Agreement  with
Perdriau Investment Corp. (“Perdriau”) to purchase 50% of the mineral
rights, including all easements, rights of way and appurtenant rights of any
type that run with the mineral rights in certain sections of Elko County, Nevada
(the “Property”).  The purchase price was $10 per net acre for 340 net
acres for a total purchase price of $3,400.  Perdriau will be entitled
to receive a royalty of $0.25 per ton for material mined and removed from the
Property. Material mined and stored on the Property or adjacent property for
reclamation purposes will not be subject to any royalty. Material removed from
the Property for the purposes of testing or bulk sampling, provided it does not
exceed 50,000 tons, will also not be subject to any royalty.  The
royalty will be calculated and paid within 45 days after the end of each
calendar quarter.





In
November 2009, the Company made a decision to expand its area of exploration to
include cement grade limestone properties located in Manitoba,
Canada.  The Company entered into an agreement to acquire, as a
wholly-owned subsidiary, Canadian Infrastructure Corp. (“CIC”), a Canadian
corporation, pursuant to a Share Exchange Agreement (the “Agreement”) between
the Company, CIC and Todd D. Montgomery dated as of December 15, 2009.  Mr.
Montgomery is the sole shareholder of CIC and serves as the Company’s Chief
Executive Officer and as a member of its Board of Directors.  The
Agreement was approved by the disinterested members of the Company’s Board of
Directors on November 27, 2009.  Under the terms of the Agreement, the
Company acquired all of the issued and outstanding stock of CIC in exchange for
1,021,777 Shares at the agreed upon price of $0.40 per Share.  The
total price of $408,710.90 represented Mr. Montgomery’s  cost of
forming CIC, assembling the limestone properties and obtaining exploration work
and reports on the properties.  The purchase price was significantly
below an independent valuation.  The Agreement was initially expected
to close on January 1, 2010, but was extended by an addendum dated January 14,
2010 and closed on February 9, 2010.  The transaction will be measured at
the fair value, being the market value of the Shares on the date of the
Share Exchange Agreement, which was $0.20 per Share.  CIC controls 94
quarry leases issued by the Province of Manitoba, Canada, covering 6,090.052
hectares (15,048,846 acres) requiring annual rental payments
of  $143,465 (CAD $150,782).




- 32
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The
Company is required to pay to the Department of Interior Bureau of Land
Management (“BLM”) on or before August 31st of each
year, a fee in the amount of $140 per mineral claim held by the
Company.  The total amount paid on August 31, 2009 was $172,620 for
1,233 claims held by the Company at that date.  During the six-month
period ended December 31, 2009, the Company acquired 436 mineral claims in
Lincoln County, Nevada and 44 mineral claims in Pershing County, Nevada were
recorded and 4 mineral claims in Elko County, Nevada were
abandoned.





The
Company is also required to pay annual fees to counties in which the claims are
held.  At August 31, 2009, the Company paid $12,356 to nine
counties.





The
Company also holds 9 patented claims and 2 leased patented claims.  A
patented claim is fee simple title to the property.  Patented claims
are subject to taxes assessed by the local community based on assessment rates
set annually.





By letter
dated November 27, 2009, the U.S. Attorney’s Office asked for contribution from
the Company for the cost of putting out a fire that occurred on May 8, 2008 on
approximately 451 acres of land owned by the BLM.  The cost of putting
out the fire and rehabilitating the burned area was approximately
$550,000.  The Company has denied any responsibility for the fire and
has alerted its liability insurance carrier. The Company has not accrued any
costs for this claim in its financial statements.





Cash
Requirements





At
December 31, 2009, the Company had cash and cash equivalents of $183,394,
short-term investments of $1,534,147 and prepaid expenses of $191,191for total current assets
of $1,908,732.





Our
ability to incur planned Project expenses is subject to permitting programs with
the BLM and results of the drilling as it progresses.  The Company has
no firm commitment for additional financing and may not be able to incur planned
Project expenses unless further capital is raised.





The
Company hopes to be able to sell part or all of its precious and base metal
projects and its Red Rock Mill or its wholly owned subsidiary, Silver Reserve
Corp., that controls these assets, and use the proceeds for exploration and
drilling on the Company’s limestone projects.





Subsequent
Events





The
Company has reviewed subsequent events up to February 12, 2010. Subsequent
events are as follows.





On
January 12, 2010, the Company entered into an agreement with Railroad Industries
Incorporated to prepare a market analysis for calcium carbonate, quicklime and
other materials marketable from high grade limestone deposits for the regions of
Central Canada and Western Unites States.  The cost of the study is
estimated to be between $28,875 and $39,900, depending on the number of hours
required. The Company paid a $5,000 refundable deposit upon execution of
the contract to be applied to the final invoice.




- 33
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On
January 15, 2010, Roger M. Hall resigned as Chief Operating Officer and as a
member of the Company’s Board of Directors.  Subsequently, Mr. Hall
resigned as the Vice President – Exploration of IMC US.  As of January
15, 2010, the Company terminated its Independent Contractor Agreement dated
April 1, 2007.  Both parties waived any applicable notice periods and
the termination was effective immediately.  As consideration for his
services, options previously granted to Mr. Hall were extended and will expire
as follows: 200,000 options to acquire Shares at $0.15 per Share will expire on
April 15, 2010; 200,000 options to acquire Shares at $0.15 per Share will expire
on December 10, 2013 and 250,000 to acquire Shares at $0.30 per Share will
expire on April 9, 2012.  There were no disagreements between Mr. Hall
and the Company with respect to the Company’s management, policies, procedures,
internal controls or public disclosure documents.





On
January 15, 2010, the Company entered into an “Independent Contractor Agreement”
with a Karl Frost.  Mr. Frost was given the title of “Chief Geologist”
and will be responsible for the preparation and oversight of all geological
programs and activities.  The Independent Contractor Agreement
has a term of one year and is automatically renewable thereafter. Either party
may terminate the agreement upon 60 days notice or in the case of breach or
default with 5 days of written notice.  During the term of the
agreement the Company will pay Mr. Frost a fee of $12,500 per month and
reimburse him related business expenses. In addition, during the first term of
this agreement, the Company granted Mr. Frost an option to purchase 250,000
common shares of the Company at an exercise price of $0.25 per
share.  These options were granted in accordance with the terms of the
Company’s 2006 Stock Option Plan and vest at the rate of 1/12 each month until
fully vested.  The options granted have a term of 5 years.





On
January 15, 2010 the Company entered into a Property Lease Agreement (the “Lease
Agreement”) with the Eugene M. Hammond to lease the surface rights on 80
acres of vacant land located in Elko County, Nevada.  The term of the
Lease Agreement is five years with an option in favor of IMC US to purchase the
property. IMC US will pay rent of $500 on the anniversary date for so long as
this Lease is in effect.





On
January 15, 2010, the company entered into a Mineral Rights Agreement (the
“Purchase Agreement”) with Eugene M. Hammond. to purchase 25% of the
mineral rights, including all easements, rights of way and appurtenant rights of
any type that run with the mineral rights on 80 acres of vacant land in certain
sections of Elko County, Nevada (the “Property”).  The purchase price
was $10 per net acre for a total purchase price of $200.





Eugene M.
Hammond will be entitled to receive a royalty of $0.125 per ton for material
mined and removed from the Property. Material mined and stored on the Property
or adjacent property for reclamation purposes will not be subject to any
royalty. Material removed from the Property for the purposes of testing or bulk
sampling, provided it does not exceed 50,000 tons, will also not be subject to
any royalty.  The royalty will be calculated and paid within 45 days
after the end of each calendar quarter.





Two
additional projects with 200 mineral claims in Elko County, Nevada were
recorded. IMC US submitted applications to the State of Arizona for leases
on 18 sections or portions of sections.




- 34
-


As of
February 1, 2010, the Company entered into a Consulting Services Agreement to
provide for receptionist and administrative services at its Reno, Nevada
corporate headquarters.  Pursuant to this Agreement, the Company will
pay $51,000 per year for such services.  The Agreement is terminable
by either party upon 30 days prior notice.





On
February 9, 2010 the Company completed the acquisition of Canadian
Infrastructure Corp. (“CIC”).  CIC holds three limestone properties
located in southern Manitoba, Canada.  These properties consist of 94
quarry leases issued by the Province of Manitoba, Canada covering 6,090.052
hectares (15,048,846 acres).  The transaction will be measured at the fair
value, being the market value of the Shares on the date of the Share
Exchange Agreement, being $0.20 per Share.


- 35
-


Item
3.  Quantitative and Qualitative Disclosures About Market Risk





Not
Applicable





Item
4T. Controls and Procedures





CONTROLS
AND PROCEDURES





Based on
an evaluation, conducted by our Chief Executive Officer and Chief Financial
Officer, of the effectiveness of the design and operation of our disclosure
controls and procedures as required by Exchange Act Rule 13a-15(e), they
concluded that our disclosure controls and procedures were effective as of
December 31, 2009, to ensure that information required to be disclosed by us in
the reports that we file or submit under the Exchange Act are:





1.
            recorded,
      processed, summarized and reported within the time periods specified by
      the SEC's rules and forms, and




2.
            accumulated
      and communicated to management, including the Chief Executive Officer and
      Chief Financial Officer, as appropriate to allow timely decisions
      regarding required disclosure.




Management
of Infrastructure Materials Corp. is responsible for establishing and
maintaining adequate internal control over financial
reporting.  Internal control over financial reporting is defined in
Rule 13a-15(f) or 15d-15(f) promulgated under the Securities Exchange Act of
1934 as a process designed by, or under the supervision of, the company's
principal executive and principal financial officers and effected by the
company's board of directors, management and other personnel, to provide
reasonable assurance regarding the reliability of financial reporting and the
preparation of financial statements for external purposes in accordance with
accounting principles generally accepted in the United States and includes those
policies and procedures that:





*
 Pertain to the maintenance of records that in reasonable detail accurately
and fairly reflect the transactions and dispositions of the assets of the
company;




*
 Provide reasonable assurance that transactions are recorded as necessary
to permit preparation of financial statements in accordance with accounting
principles generally accepted in the United States and that receipts and
expenditures of the company are being made only in accordance with
authorizations of management and directors of the company; and




*
 Provide reasonable assurance regarding prevention or timely detection of
unauthorized acquisition, use or disposition of the company's assets that could
have a material effect on the financial statements.




- 36
-


Because
of its inherent limitations, internal control over financial reporting may not
prevent or detect misstatements.  Even those systems determined to be
effective can provide only reasonable assurance with respect to financial
statement preparation and presentation.  Because of the inherent
limitations of internal control, there is a risk that material misstatements may
not be prevented or detected on a timely basis by internal control over
financial reporting.  However, these inherent limitations are known
features of the financial reporting process.  Therefore, it is
possible to design into the process safeguards to reduce this risk.




In making
this assessment, management used the criteria set forth by the Committee of
Sponsoring Organizations of the Treadway Commission in Internal
Control-Integrated Framework.




Inherent
in small business is the pervasive problem of segregation of
duties.  Given that the Company has a small accounting department,
segregation of duties cannot be completely accomplished at this stage in the
corporate lifecycle.  Management has added many compensating controls
to effectively reduce and minimize the risk of a material misstatement in the
Company’s financial statements.




Based on
its assessment, management has concluded that the Company's disclosure controls
and procedures and internal control over financial reporting is effective based
on those criteria.




During
the quarter ended December 31, 2009, there have been no changes to the Company’s
internal controls over financial reporting that have materially affected, or are
reasonably likely to materially affect, the Company’s internal control over
financial reporting.


- 37
-




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
1A:        RISK FACTORS:





The
following are certain risk factors that could affect our business, financial
condition, operating results and cash flows.  These risk factors should be
considered in connection with evaluating the forward-looking statements because
they could cause actual results to differ materially from those expressed in any
forward-looking statement.  The risk factors highlighted below are not the
only ones we face. If any of these events actually occur, our business,
financial condition, operating results or cash flows could be negatively
affected.





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, limited working capital and no commitments
to obtain additional financing.  The Company will require additional
working capital to carry out its exploration programs.  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:





-
            further
      exploration of our properties and the results of that
      exploration.





-
            raising
      the capital necessary to conduct this exploration and preserve the
      Company’s Properties.





-
            raising
      capital to develop our properties, establish a mining operation, and
      operate this mine in a profitable manner if any of these activities are
      warranted by the results of our exploration programs and a feasibility
      study.





Because
the Company has no operating revenue, it expects to incur operating losses in
future periods as it continues to spend funds to explore its
properties.  Failure to raise the necessary capital to continue
exploration could cause the Company to go out of business.




- 38
-




2.
            WE
      WILL NEED TO RAISE ADDITIONAL FINANCING TO COMPLETE FURTHER
      EXPLORATION




We will
require significant additional financing in order to continue our exploration
activities and our assessment of the commercial viability of our properties.
 There can be no assurance that we will be successful in our efforts to
raise these require funds, or on terms satisfactory to us.  The continued
exploration of current and future mineral properties and the development of our
business will depend upon our ability to establish the commercial viability of
our properties and to ultimately develop cash flow from operations and reach
profitable operations. We currently are in an exploration stage and we have no
revenue from operations and we are experiencing significant cash outflow from
operating activities.  If we are unable to obtain additional
financing, we will not be able to continue our exploration activities and our
assessment of the commercial viability of our precious metal and mineral
properties.




3.
            WE
      HAVE NO RESERVES AND WE MAY FIND THAT OUR PROPERTIES ARE NOT COMMERCIALLY
      VIABLE




Our
properties do not contain reserves in accordance with the definitions adopted by
the Securities and Exchange Commission, and there is no assurance that any
exploration programs that we undertake will establish reserves. All of our
mineral properties are in the exploration stage as opposed to the development
stage and have no known body of economic mineralization. The known
mineralization at these projects has not yet been determined, and may never be
determined to be economic. We plan to conduct further exploration activities on
our properties, which future exploration may include the completion of
feasibility studies necessary to evaluate whether a commercial mineable mineral
exists on any of our properties. There is a substantial risk that these
exploration activities will not result in discoveries of commercially
recoverable quantities of minerals. Any determination that our properties
contain commercially recoverable quantities of minerals may not be reached until
such time that final comprehensive feasibility studies have been concluded that
establish that a potential mine is likely to be economic. There is a substantial
risk that any preliminary or final feasibility studies carried out by us will
not result in a positive determination that our mineral properties can be
commercially developed.




4.
            OUR
      BUSINESS IS DIFFICULT TO EVALUATE BECAUSE WE HAVE A LIMITED OPERATING
      HISTORY.




In
considering whether to invest in our common stock since there is only limited
historical financial and operating information available on which to base your
evaluation of our performance.  In addition, we have only recently
acquired our primary minerals exploration properties.




5.
            WE
      HAVE A HISTORY OF OPERATING LOSSES AND THERE CAN BE NO ASSURANCES WE WILL
      BE PROFITABLE IN THE FUTURE.





We have a
history of operating losses, expect to continue to incur losses, and may never
be profitable. Further, we have been dependent on sales of our equity securities
and debt financing to meet our cash requirements.  We have incurred losses
totaling approximately $14,719,529 from inception to December 31, 2009.  As
of December 31, 2009, we had an accumulated deficit of $14,719,529 and incurred
losses of approximately $2,289,880 during the six month period ended December
31, 2009.  Further, we do not expect positive cash flow from operations in
the near term.  There is no assurance that actual cash requirements will
not exceed our estimates.  In particular, additional capital may be
required in the event that: (i) the costs to acquire additional mineral
exploration claims are more than we currently anticipate; or (ii) exploration
and or future potential mining costs for additional claims increase beyond our
expectations.




- 39
-





6.
            THE
      RISKS ASSOCIATED WITH EXPLORATION AND DEVELOPMENT AND, IF APPLICABLE,
      MINING COULD CAUSE PERSONAL INJURY OR DEATH, ENVIRONMENT DAMAGE, DELAYS IN
      MINING, MONETARY LOSSES AND POSSIBLE LEGAL
  LIABILITY.





We are
not currently engaged in mining operations because we are in the exploration
phase and have not yet any proved minerals reserves.  We do not presently
carry property and liability insurance.  Cost effective insurance contains
exclusions and limitations on coverage and may be unavailable in some
circumstances.





7.
            BECAUSE
      OF THE UNIQUE DIFFICULTIES AND UNCERTAINTIES INHERENT IN MINERAL
      EXPLORATION VENTURES AND CURRENT DETERIORATION IN EQUITY MARKETS, WE FACE
      A HIGH RISK OF BUSINESS FAILURE.





Investors
should be aware of the difficulties normally encountered by new mineral
exploration companies and the high rate of failure of such
enterprises.  Our prospects are further complicated by a pronounced
deterioration in equity markets and constriction in equity capital available to
finance and maintain our exploration activities.  Our likelihood of
success must be considered in light of the problems, expenses, difficulties,
complications and delays encountered in connection with the exploration of the
mineral properties that we plan to undertake and the difficult economy and
market volatility that we are experiencing.  Moreover, most
exploration projects do not result in the discovery of commercial mineable
deposits.





8.           OUR
BUSINESS IS AFFECTED BY CHANGES IN COMMODITY PRICES.





Our
ability to develop our properties and the future profitability of those
operations is directly related to the market price of certain minerals such as
silver and limestone as well as the price and availability of
cement.  The Company is negatively affected by the current decline in
commodity prices





9.
            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, which could result in having to delay or abandon work on some or
all of the properties.




- 40
-


10.
            THERE
      ARE PENNY STOCK SECURITIES LAW CONSIDERATIONS THAT COULD LIMIT YOUR
      ABILITY TO SELL YOUR SHARES.





Our
common stock is considered a "penny stock" and the sale of our stock by you will
be subject to the "penny stock rules" of the Securities and Exchange
Commission.  The penny stock rules require broker-dealers to take
steps before making any penny stock trades in customer accounts.  As a
result, the market for our shares could be illiquid and there could be delays in
the trading of our stock which would negatively affect your ability to sell your
shares and could negatively affect the trading price of your
shares.





11.
            CURRENT
      LEVELS OF MARKET VOLATILITY COULD HAVE ADVERSE
  IMPACTS





The
capital and credit markets have been experiencing volatility and disruption. If
the current levels of market disruption and volatility continue or worsen, there
can be no assurance that the Company will not experience adverse effects, which
may be material. These effects may include, but are not limited to, difficulties
in raising additional capital or debt and a smaller pool of investors and
funding sources. There is thus no assurance the Company will have access to the
equity capital markets to obtain financing when necessary or
desirable.





12.
            MINING
      OPERATIONS IN GENERAL INVOLVE A HIGH DEGREE OF RISK, WHICH WE MAY BE
      UNABLE, OR MAY NOT CHOOSE TO INSURE AGAINST, MAKING EXPLORATION AND/OR
      DEVELOPMENT ACTIVITIES WE MAY PURSUE SUBJECT TO POTENTIAL LEGAL LIABILITY
      FOR CERTAIN CLAIMS.





Our
operations are subject to all of the hazards and risks normally encountered in
the exploration, development and production of minerals. These include unusual
and unexpected geological formations, rock falls, flooding and other conditions
involved in the drilling and removal of material, any of which could result in
damage to, or destruction of, mines and other producing facilities, damage to
life or property, environmental damage and possible legal
liability.  Although we plan to take adequate precautions to minimize
these risks, and risks associated with equipment failure or failure of retaining
dams which may result in environmental pollution, there can be no assurance that
even with our precautions, damage or loss will not occur and that we will not be
subject to liability which will have a material adverse effect on our business,
results of operation and financial condition.





13.
            BECAUSE
      OF THE UNIQUE DIFFICULTIES AND UNCERTAINTIES INHERENT IN MINERAL
      EXPLORATION VENTURES, WE FACE A HIGH RISK OF BUSINESS
    FAILURE.





Stockholders
should be aware of the difficulties normally encountered by new mineral
exploration companies and the high rate of failure of such
enterprises.  The likelihood of success must be considered in light of
the problems, expenses, difficulties, complications and delays encountered in
connection with the exploration of the mineral properties that we plan to
undertake.  These potential problems include, but are not limited to,
unanticipated problems relating to exploration, and additional costs and
expenses that may exceed current estimates.  Most exploration projects
do not result in the discovery of commercially mineable
deposits.  Problems such as unusual or unexpected formations and other
conditions are involved in mineral exploration and often result in unsuccessful
exploration efforts.




- 41
-


14.
            WE
      DO NOT INTEND TO PAY DIVIDENDS IN THE FORESEEABLE
  FUTURE.





We have
never declared or paid a dividend on our common stock. We intend to retain
earnings, if any, for use in the operation and expansion of our business and,
therefore, do not anticipate paying any dividends in the foreseeable
future.





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





On
September 21, 2007, the Company issued 1,500,000 Shares to each of two
consultants, for a total of 3,000,000 Shares valued at
$2,250,000.  The Shares issued to the consultants are considered
“restricted” securities and cannot be resold unless an exemption from
registration under the Securities Act is available, such as the exemption afford
by Rule 144 promulgated under the Securities Act.





The
convertible debentures issued in the fiscal years of 2006 and 2007 had a
maturity date of December 31, 2007 and an interest rate of 2% per
annum.  Pursuant to the terms of the convertible debentures, the
Company had the option of paying interest in Shares or in cash.  The
Company elected to pay interest in Shares, which were restricted upon
issuance.  An aggregate of 184,596 Shares were issued upon the
conversion of the convertible debentures as payment of interest.





On August
22, 2008, the Company completed private placements of 7,040,000 “Units” at $0.50
per Unit from accredited investors, as that term is defined in Regulation D
promulgated under the Securities Act.  Each one Unit consists of one
Share and one half of a Share purchase warrant.  Each full warrant
entitles the holder to purchase one Share at $0.75 on or before September 1,
2010.  The private placement was exempt from registration under the
Securities Act pursuant to an exemption afforded by Regulation S.  All
of the investors were non-U.S. Persons as that term is defined under Regulation
S and executed subscription agreements containing the representations and
covenants required for the exemption under Regulation S.  The Company
used the proceeds for exploration expenses and general operating
capital.  The Company paid a commission of $147,000 and issued 294,000
broker warrants to purchase Units at $0.50 per Unit in connection with the
private placement.  These Units have the same terms as those sold to
investors.  The broker warrants expire on September 1,
2010.  None of the Shares or shares underlying the warrants or broker
warrants were registered.  During the year ended June 30, 2009,
2,820,000 warrants were exercised at $0.25.  The Company received
$705,000 for 2,820,000 restricted Shares.





On
November 7, 2008 the Company completed a Share Exchange Agreement with the
Company’s CEO to acquire all of the outstanding shares of IMC US for
consideration of 397,024 Shares of the Company.  The transaction was
measured and accounted at its fair value.





ITEM
      3:
            DEFAULTS
      UPON SENIOR SECURITIES:





None.





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





None.




- 42
-


ITEM
      5:
            OTHER
      INFORMATION:





On
January 15, 2010, Roger M. Hall resigned as a Director and as Chief
Operating Officer of the Company.  Mr. Hall subsequently resigned as
Vice President-Exploration of IMC US.   There were no
disagreements between Mr. Hall and the Company with respect to the Company’s
management, policies, procedures, internal controls or public disclosure
documents.





On
October 22, 2009, Randal Ludwar resigned from his position as Chief Financial
Officer of the Company.  Mr. Ludwar will remain a member of the Company’s
Board of Directors.  There were no disagreements between Mr. Ludwar and the
Company with respect to the Company’s management, operations, policies or
financial reporting.





On
October 29, 2009, Rakesh Malhotra was appointed Chief Financial Officer of the
Company.





ITEM
      6:
            EXHIBITS
      AND REPORTS ON FORM 8-K





Exhibits:





(a)
                10.1
                Termination
      Agreement effective January 15, 2010 the Company and Roger M.
      Hall.10.2
                Independent
      Contractor Agreement effective January 15, 2010 between the Company and
      Karl Frost.10.3
                Share
      Purchase Agreement dated December 15, 2009 between the Company, Canadian
      Infrastructure Corp. and Todd Montgomery.10.4
                Addendum
      dated January 14, 2010 between the Company, Canadian Infrastructure Corp.
      and Todd Montgomery.





(b)
                31.1
                Rule
      13a-14(a)/15d-14(a) Certification of Chief Executive
    Officer.31.2
                Rule
      13a-14(a)/15d-14(a) Certification of Chief Financial
    Officer.32.1
                Certificate
      of Chief Executive Officer and Chief Financial Officer pursuant to 18
      U.S.C. Section 1350, as adopted pursuant to Section 906 of the
      Sarbanes-Oxley Act of 2002.(c)
                Current
      Report on Form 8-K, “Item 5.02: Departure of Directors or Certain
      Officers; Appointment of Certain Officers,” dated January 20,
      2010




- 43
-




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.




INFRASTRUCTURE
      MATERIALS CORP.Dated:  February
      11, 2010
                By:
                /s/Joanne
      HughesJoanne
      Hughes, Secretary




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