VetaNova Inc. - Annual Report: 2010 (Form 10-K)

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

FORM 10-K

(Mark one)

[x] Annual report under Section 13 or 15(d) of the Securities Exchange Act of 1934

For the Fiscal Year April 30, 2010

or

[ ] Transition report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

For the transition period from ______to _________

Commission file number: 000-51068

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

139 Grand River St. N., PO Box 510
Paris, Ontario N3L 3T6 Canada
(Address of principal executive offices) (Zip Code)

Registrant's telephone number, including area code: 210-495-8777

Securities registered under Section 12(b) of the Exchange Act: None

Securities registered under Section 12(g) of the Exchange Act:

Common Stock, par value $0.0001 per share

Indicate by check mark if the registrant is a well-known seasoned issuer as defined by Rule 405 of the Securities Act

Yes [ ]         No [X]

Indicate by check mark if the registrant is not required to file reports pursuant to Rule 13 or Section 15(d) of the Act

Yes [ ]             No [X]

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

Yes [X]             No [ ]

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate web site, if any, every Interactive Data File required to be submitted and posted pursuant Rule 405 of Regulation S-T (s 220.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files.

Yes [ ]             No [X]

Check if disclosure of delinquent filers in response to Item 405 of Regulation S-K is not contained in this form, and no disclosure will be contained, to the best of registrant's knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K. [ ]

Indicate by check mark whether the registrant is a large accelerated filer, a non-accelerated filer or a smaller reporter.

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).

Yes [ ]             No [X]

Issuer's revenues for its most recent fiscal year: $0.

The aggregate market value of the Common Stock held by non-affiliates of the issuer, as of April 30, 2010 was approximately $69,554 for the issuer’s Common Stock reported for such date on the OTC Bulletin Board. For purposes of this disclosure, shares of Common Stock held by persons who the issuer believes beneficially own more than 5% of the outstanding shares of Common Stock and shares held by officers and directors of the issuer have been excluded because such persons may be deemed to be affiliates of the issuer. This determination is not necessarily conclusive.

As of April 30, 2010, 41,839,535 shares of the issuer’s Common Stock were outstanding.

Transitional Small Business Disclosure

Yes [ ]             No [x]

TABLE OF CONTENTS

FINANCIAL STATEMENTS

Page No.

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To the Board of Directors and Stockholders of
Yukon Gold Corporation, Inc.
(An Exploration Stage Company)

We have audited the accompanying consolidated balance sheets of Yukon Gold Corporation, Inc. as at April 30, 2010 and 2009 and the related consolidated statements of operations, cash flows and stockholders’ deficiency for the years ended April 30, 2010 and 2009 and for the period from incorporation to April 30, 2010. These consolidated financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on these consolidated financial statements based on our audits.

We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion.

The company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. Our audit included consideration of internal control over financial reporting as a basis for designing audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the company’s internal controls over financial reporting. Accordingly, we express no such opinion. In our opinion, the consolidated financial statements referred to above present fairly, in all material respects, the financial position of Yukon Gold Corporation, Inc. as at April 30, 2010 and 2009 and the results of its operations and its cash flows for the years ended April 30, 2010 and 2009 and for the period from incorporation to April 30, 2010 in conformity with United States generally accepted accounting principles.

The accompanying consolidated financial statements have been prepared assuming that the Company will continue as a going concern. As discussed in Note 2 to the consolidated financial statements, the Company is an exploration stage mining company and has no established source of revenues. These conditions raise substantial doubt about its ability to continue as a going concern. Management’s plans regarding these matters are also described in the notes to the consolidated financial statements. The consolidated financial statements do not include any adjustments that might result from the outcome of this uncertainty.

1167 Caledonia Road
Toronto, Ontario M6A 2X1
T e l : 416 785 5353
F a x : 416 785 5663

F-1

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

APPROVED ON BEHALF OF THE BOARD

/s/ J. L. Guerra, Jr.
J. L. Guerra, Jr., Director and Chairman

/s/ Douglas Oliver
Douglas Oliver, CEO and Director

F-2

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

F-3

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

F-4

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

F-5

F-6

F-7

F-8

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

F-9

1. BASIS OF PRESENTATION

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

2. GOING CONCERN

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 has no source for operating revenue and expects to incur significant expenses before establishing operating revenue. Because of continuing operating losses, negative working capital, stockholders’ deficiency and cash outflows from operations, the Company’s continuance as a going concern is dependent upon its ability to obtain adequate financing and to reach profitable levels of operation. In the event that the Company is unable to raise additional capital, as to which there is no assurance, the Company will not be able to continue doing business. Further, the Company subsidiary has a court order to pay a penalty for $118,269 (CDN $120,138) for early termination of its office lease. The prior landlord had made the said claim in the Ontario Superior Court of Justice. The Company’s future success is dependent upon its continued ability to raise sufficient capital, not only to maintain its operating expenses, but to explore for reserves. There is no guarantee that such capital will be available on acceptable terms, if at all or if the Company will attain profitable levels of operation.

The Company is actively pursuing equity and short-term bridge loan financing, which may include financing backed by a pledge of some or all of the Company’s exploration property assets. The Company also is simultaneously exploring opportunities to effect business combinations or joint ventures involving additional mining assets that may provide opportunities for greater long-term financing.

These consolidated financial statements have been prepared in accordance with United States generally acceptable accounting principles applicable to a going concern. Accordingly, they do not give effect to adjustments that would be necessary should the Company be unable to continue as a going concern and therefore be required to realize its assets and liquidate its liabilities and commitments in other than the normal course of business and at amounts different from those in the accompanying consolidated financial statements.

3. NATURE OF OPERATIONS

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 mining properties. Mineral property exploration costs are expensed as incurred. Mineral property payments are initially capitalized in accordance with the ASC 805-20-55-37, previously referenced as EITF 04-2 when incurred. The Company assesses the carrying costs for impairment under Accounting Standards 930 Extractive Activities – Mining (AS 930) at each fiscal quarter end. An impairment is recognized when the sum of the expected undiscounted future cash flows is less than the carrying amount of the mineral property. Impairment losses, if any, are measured as the excess of the carrying amount of the mineral property over its estimated fair value. 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. Once capitalized, such costs will be amortized using the units-of-production method over the estimated life of the probable reserves. If mineral properties are subsequently abandoned or impaired, any capitalized costs will be charged to operations. The Company assesses the carrying costs for impairment at each fiscal quarter end. The Company has determined that all property payments are impaired and accordingly has written off the acquisition costs to project expense.

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4. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES a) Use of Estimates

Preparation of financial statements in accordance with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the amounts reported in the financial statements and related notes to financial statements. These estimates are based on management's best knowledge of current events and actions the Company may undertake in the future. Actual results may ultimately differ from such estimates. Significant estimates include accruals, valuation allowance and estimates for calculation of stock based compensation.

b) Cash

Cash includes amounts due from banks The carrying amounts approximate fair values because of the short maturity of those instruments.

c) Financial Instruments

The fair market value of the Company’s financial instruments comprising cash, loan from director, accounts payable and accrued liabilities and obligations under capital leases were estimated to approximate their carrying values due to immediate or short-term maturity of these financial instruments. The Company maintains cash balances at financial institutions. The Company has not experienced any material losses in such accounts.

FASB defines fair value as the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. Valuation techniques used to measure fair value must maximize the use of observable inputs and minimize the use of unobservable inputs. The standard describes a fair value hierarchy based on three levels of inputs, of which the first two are considered observable and the last unobservable, that may be used to measure fair value, which are the following:

Commodity Price Risk: The ability of the Company to develop its properties and the future profitability of the Company is directly related to the market price of certain minerals.

Foreign Exchange Risk:

The Company conducts most of its operating activities in Canadian dollars. The Company is therefore subject to gains or losses due to fluctuations in Canadian currency relative to the US dollar.

d) Property, Plant and Equipment

Property, Plant, and Equipment are recorded at cost less accumulated amortization. Amortization is provided commencing in the month following acquisition using the following annual rate and method:

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4. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

d) Property, Plant and Equipment-Cont’d

e) Operating and Capital Leases

Costs associated with operating leases are expensed as incurred. The cost of assets acquired via capital leases are capitalized and amortized over their useful lives. An offsetting liability is established to reflect the future obligation under capital leases. This liability is reduced by the future principal payments.

f) Foreign Currency Translation

The Company’s operating subsidiary is a foreign private company and maintains its books and records in Canadian dollars (the functional currency). The subsidiary’s financial statements are converted to US dollars for consolidation purposes. The translation method used is the current rate method, where the functional currency is the foreign currency. Under the current rate method all assets and liabilities are translated at the current rate, stockholders’ equity accounts are translated at historical rates and revenues and expenses are translated at average rates for the year.

Due to the fact that items in the financial statements are being translated at different rates according to their nature, a translation adjustment is created. This translation adjustment has been included in Accumulated Other Comprehensive Income (Loss).

g) Income taxes

Deferred tax assets and liabilities are recorded for differences between the financial statement and tax basis of the assets and liabilities that will result in taxable or deductible amounts in the future based on enacted tax laws and rates. Valuation allowances are established when necessary to reduce deferred tax assets to the amount expected to be realized. Income tax expense is recorded for the amount of income tax payable or refundable for the period increased or decreased by the change in deferred tax assets and liabilities during the period.

h) Revenue Recognition

The Company’s revenue recognition policies are expected to follow common practice in the mining industry. Revenue is recognized when concentrate or dore bars, in the case of precious metals, is produced in a mill processing ore from one or more mines. The only condition for recognition of revenue in these instances is the production of the dore or concentrate. In order to get the ore to a concentrate stage the ore must be mined and transported to a mill where it is crushed and ground. The ground product is then processed by gravity separation and/or flotation to produce a concentrate. In some circumstances chemical treatment is used to extract the precious metals from the concentrate into a solution. This solution is then subjected to various processes to precipitate the precious metals back to a solid state that can be melted down and poured into a mould to produce a dore bar (a combination of gold and silver).

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4. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES-CONT’D

i) Comprehensive Income

The Company reports comprehensive income or loss in its consolidated financial statements. In addition to items included in net income, comprehensive income includes items currently charged or credited directly to stockholders’ equity, such as foreign currency translation adjustments.

j) Long-Lived Assets

The Company records impairment of long-lived assets to be held and used or to be disposed of when indicators of impairment are present and the undiscounted cash flows estimated to be generated by those assets are less than the carrying amount. At April 30, 2010 and April 30, 2009, the Company recognized impairment of $nil and $88,069 respectively. Amortization expense for the years ended April 30, 2010 and 2009 was $11,315 and $33,769 respectively.

k) Acquisition, Exploration and Evaluation Expenditures

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 mining properties. Mineral property exploration costs are expensed as incurred. Mineral property payments are initially capitalized in accordance with the ASC 805-20-55-37, previously referenced as EITF 04-2 when incurred. The Company assesses the carrying costs for impairment under Accounting Standards 930 Extractive Activities – Mining (AS 930) at each fiscal quarter end. An impairment is recognized when the sum of the expected undiscounted future cash flows is less than the carrying amount of the mineral property. Impairment losses, if any, are measured as the excess of the carrying amount of the mineral property over its estimated fair value. 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. Once capitalized, such costs will be amortized using the units-of-production method over the estimated life of the probable reserves. If mineral properties are subsequently abandoned or impaired, any capitalized costs will be charged to operations. The Company has determined that all property payments are impaired and accordingly has written off the acquisition costs to project expense.

l) Stock Based Compensation

All awards granted to employees and non-employees after October 31, 2005 are valued at fair value by using the Black-Scholes option pricing model and recognized on a straight line basis over the service periods of each award. The Company accounts for equity instruments issued in exchange for the receipt of goods or services from other than employees using the estimated fair market value of the consideration received or the estimated fair value of the equity instruments issued, whichever is more reliably measurable. The value of equity instruments issued for consideration other than employee services is determined on the earlier of a performance commitment or completion of performance by the provider of goods or services. As of April 30, 2010 and April 30, 2009, there was $ nil and $5,869 of unrecognized expense related to non-vested stock-based compensation arrangements granted. The total stock-based compensation expense relating to all employees and non employees for the years ended April 30, 2010 and 2009 was $5,869 and $31,858 respectively.

m) Earnings or Loss per Share

Basic loss per share is computed by dividing net loss by the weighted average number of common shares outstanding for the year. Diluted loss per share is computed by dividing net loss by the weighted average number of common shares outstanding plus common stock equivalents (if dilutive) related to stock options and warrants for each year. There were no common equivalent shares outstanding at April 30, 2010 and 2009 that have been included in dilutive loss per share calculation as the effects would have been anti-dilutive. At April 30, 2010, there were 664,000 options from the 2003 Stock Option Plan and 637,500 options from the 2006 Stock Option Plan and 500,000 warrants outstanding. At April 30, 2009, there were 1,566,000 options from the 2003 Stock Option Plan and 1,487,500 options from the 2006 Stock Option Plan and 4,913,141 warrants outstanding.

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4. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES-CONT’D

n) Flow-Through Financing

The Company has financed a portion of its exploration activities through the issue of flow-through shares, which transfer the Canadian tax deductibility of exploration expenditure to the investor. Proceeds received from the issuance of such shares are allocated between the offering of shares and the sale of tax benefits. The allocation is made based on the difference between the quoted price of the existing shares and the amount the investor pays for the shares. A liability is recognized for the difference. Resource expenditure deductions for income tax purposes related to exploration and development activities funded by flow-through share arrangements are renounced to investors in accordance with the income tax legislation in Canada. On such renunciation, a deferred tax liability is created and the liability recognized at issuance reversed. The Company recognized the benefit of tax losses to offset the deferred tax liability resulting in an income tax recovery.

o) Recent Pronouncements

FASB ASC TOPIC 805 – “Business Combinations.” The objective of this topic is to enhance the information that an entity provides in its financial reports about a business combination and its effects. The Topic mandates: (i) how the acquirer recognizes and measures the assets acquired, liabilities assumed and any non-controlling interest in the acquiree; (ii) what information to disclose in its financial reports and; (iii) recognition and measurement criteria for goodwill acquired. This Topic is effective for any acquisitions made on or after December 15, 2008. The adoption of this Topic did not have a material impact on the Company’s financial statements and disclosures.

FASB ASC TOPIC 810 – “Noncontrolling Interests.” The objective of this Topic is to improve the relevance, comparability, and transparency of the financial information that a reporting entity provides in its consolidated financial statements by establishing accounting and reporting standards that require: (i) the ownership interests in subsidiaries held by parties other than the parent be clearly identified, labeled, and presented in the consolidated statement of financial position within equity, but separate from the parent's equity; (ii) the amount of consolidated net income attributable to the parent and to the noncontrolling interest be clearly identified and presented on the face of the consolidated statement of income; (iii) changes in a parent's ownership interest while the parent retains its controlling financial interest in its subsidiary be accounted for consistently; (iv) when a subsidiary is deconsolidated, any retained noncontrolling equity investment in the former subsidiary be initially measured at fair value. The gain or loss on the deconsolidation of the subsidiary is measured using the fair value of any noncontrolling equity investment rather than the carrying amount of that retained investment and; (v) entities provide sufficient disclosures that clearly identify and distinguish between the interests of the parent and the interests of the non-controlling owners. This Topic is effective for fiscal years, and interim periods within those fiscal years, beginning on or after December 15, 2008. Earlier adoption is prohibited. The adoption of this Topic did not have a material impact on the Company’s financial statements and disclosures.

FASB ASC TOPIC 815 – “Derivatives and Hedging.” The use and complexity of derivative instruments and hedging activities have increased significantly over the past several years. This Topic requires enhanced disclosures about an entity's derivative and hedging activities and thereby improves the transparency of financial reporting. This Topic is effective for financial statements issued for fiscal years and interim periods beginning after November 15, 2008, with early application encouraged. The adoption of this Topic did not have a material impact on the Company’s financial statements and disclosures

FASB ASC TOPIC 944 – “Financial Services – Insurance.” Diversity exists in practice in accounting for financial guarantee insurance contracts by insurance enterprises. That diversity results in inconsistencies in the recognition and measurement of claim liabilities because of differing views about when a loss has been incurred. This Topic requires that an insurance enterprise recognize a claim liability prior to an event of default (insured event) when there is evidence that credit deterioration has occurred in an insured financial obligation. This Topic is effective for financial statements issued for fiscal years beginning after December 15, 2008 and all interim periods within those fiscal years, except for some disclosures about the insurance enterprise's risk-management activities. The adoption of this Topic did not have a material impact on the Company’s financial statements and disclosures

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4. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES-CONT’D

FASB ASC TOPIC 855 - “Subsequent Events.” In May 2009, the FASB issued Topic 855, which establish general standards of accounting and disclosure of events that occur after the balance sheet date but before financial statements are issued or are available to be issued. In particular, this Topic sets forth : (i) the period after the balance sheet date during which management of a reporting entity should evaluate events or transactions that may occur for potential recognition or disclosure in the financial statements, (ii) the circumstances under which an entity should recognize events or transactions occurring after the balance sheet date in its financial statements, (iii) the disclosures that an entity should make about events or transactions that occurred after the balance sheet date. This Topic should be applied to the accounting and disclosure of subsequent events. This Topic does not apply to subsequent events or transactions that are within the scope of other applicable accounting standards that provide different guidance on the accounting treatment for subsequent events or transactions. This Topic was effective for interim and annual periods ending after June 15, 2009, which was October 31, 2009 for the Company. The adoption of this Topic did not have a material impact on the Company’s financial statements and disclosures.

FASB ASC TOPIC 105 - “The FASB Accounting Standard Codification and the Hierarchy of Generally Accepted Accounting Principles.” In June 2009, the FASB issued Topic 105, which became the source of authoritative GAAP recognized by the FASB to be applied by nongovernmental entities. Rules and interpretive releases of the SEC under authority of federal securities laws are also sources of authoritative GAAP for SEC registrants. On the effective date of this Topic, the Codification will supersede all then-existing non-SEC accounting and reporting standards. All other non-SEC accounting literature not included in the Codification will become non-authoritative. This Topic identifies the sources of accounting principles and the framework for selecting the principles used in preparing the financial statements of nongovernmental entities that are presented in conformity with GAAP and arranged these sources of GAAP in a hierarchy for users to apply accordingly. This Topic is effective for financial statements issued for interim and annual periods ending after September 15, 2009. The adoption of this topic did not have a material impact on the Company’s disclosure of the financial statements.

FASB ASC TOPIC 320 - “Recognition and Presentation of Other-Than-Temporary Impairments.” In April 2009, the FASB issued Topic 320 amends the other-than-temporary impairment guidance in GAAP for debt securities to make the guidance more operational and to improve the presentation and disclosure of other-than-temporary impairments on debt and equity securities in the financial statements. This Topic does not amend existing recognition and measurement guidance related to other-than-temporary impairments of equity securities. The Topic is effective for interim and annual reporting periods ending after June 15, 2009, with early adoption permitted for periods ending after March 15, 2009. Earlier adoption for periods ending before March 15, 2009, is not permitted. This Topic does not require disclosures for earlier periods presented for comparative purposes at initial adoption. In periods after initial adoption, this Topic requires comparative disclosures only for periods ending after initial adoption. The adoption of this Topic did not have a material impact on the Company’s financial statements and disclosures.

FASB ASC TOPIC 860 - “Accounting for Transfer of Financial Assets and Extinguishment of Liabilities.” In June 2009, the FASB issued additional guidance under Topic 860 which improves the relevance, representational faithfulness, and comparability of the information that a reporting entity provides in its financial statements about a transfer of financial assets; the effects of a transfer on its financial position, financial performance, and cash flows; and a transferor’s continuing involvement, if any, in transferred financial assets. This additional guidance requires that a transferor recognize and initially measure at fair value all assets obtained (including a transferor’s beneficial interest) and liabilities incurred as a result of a transfer of financial assets accounted for as a sale. Enhanced disclosures are required to provide financial statement users with greater transparency about transfers of financial assets and a transferor’s continuing involvement with transferred financial assets. This additional guidance must be applied as of the beginning of each reporting entity’s first annual reporting period that begins after November 15, 2009, for interim periods within that first annual reporting period and for interim and annual reporting periods thereafter. Earlier application is prohibited. This additional guidance must be applied to transfers occurring on or after the effective date. The adoption of this Topic is not expected to have a material impact on the Company’s financial statements and disclosures.

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4. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES-CONT’D

FASB ASC TOPIC 810 - “Consolidation of Variables Interest and Special Purpose Entities.” In June 2009, the FASB issued Topic 810, which requires an enterprise to perform an analysis to determine whether the enterprise’s variable interest or interests give it a controlling financial interest in a variable interest entity. This analysis identifies the primary beneficiary of a variable interest entity as the enterprise that has both of the following characteristics: (i) The power to direct the activities of a variable interest entity that most significantly impact the entity’s economic performance and (ii) The obligation to absorb losses of the entity that could potentially be significant to the variable interest entity or the right to receive benefits from the entity that could potentially be significant to the variable interest entity. Additionally, an enterprise is required to assess whether it has an implicit financial responsibility to ensure that a variable interest entity operates as designed when determining whether it has the power to direct the activities of the variable interest entity that most significantly impact the entity’s economic performance. This Topic requires ongoing reassessments of whether an enterprise is the primary beneficiary of a variable interest entity and eliminate the quantitative approach previously required for determining the primary beneficiary of a variable interest entity, which was based on determining which enterprise absorbs the majority of the entity’s expected losses, receives a majority of the entity’s expected residual returns, or both. This Topic is effective as of the beginning of each reporting entity’s first annual reporting period that begins after November 15, 2009, for interim periods within that first annual reporting period, and for interim and annual reporting periods thereafter. Earlier application is prohibited. The adoption of this Topic is not expected to have a material impact on the Company’s financial statements and disclosures.

FASB ASC TOPIC 820 - “Fair Value measurement and Disclosures”, an Accounting Standard Update. In September 2009, the FASB issued this Update to amendments to Subtopic 82010, “Fair Value Measurements and Disclosures”. Overall, for the fair value measurement of investments in certain entities that calculates net asset value per share (or its equivalent). The amendments in this Update permit, as a practical expedient, a reporting entity to measure the fair value of an investment that is within the scope of the amendments in this Update on the basis of the net asset value per share of the investment (or its equivalent) if the net asset value of the investment (or its equivalent) is calculated in a manner consistent with the measurement principles of Topic 946 as of the reporting entity’s measurement date, including measurement of all or substantially all of the underlying investments of the investee in accordance with Topic 820. The amendments in this Update also require disclosures by major category of investment about the attributes of investments within the scope of the amendments in this Update, such as the nature of any restrictions on the investor’s ability to redeem its investments at the measurement date, any unfunded commitment, and the investment strategies of the investees. The major category of investment is required to be determined on the basis of the nature and risks of the investment in a manner consistent with the guidance for major security types in GAAP on investments in debt and equity securities in paragraph 320-10-50-lB. The disclosures are required for all investments within the scope of the amendments in this Update regardless of whether the fair value of the investment is measured using the practical expedient. The amendments in this Update apply to all reporting entities that hold an investment that is required or permitted to be measured or disclosed at fair value on a recurring or non recurring basis and, as of the reporting entity’s measurement date, if the investment meets certain criteria The amendments in this Update are effective for the interim and annual periods ending after December 15, 2009. Early application is permitted in financial statements for earlier interim and annual periods that have not been issued. The adoption of this Update is not expected to have a material impact on the Company’s financial statements and disclosures.

FASB ASC TOPIC 740 - “Income Taxes”, an Accounting Standard Update. In September 2009, the FASB issued this Update to address the need for additional implementation guidance on accounting for uncertainty in income taxes. For entities that are currently applying the standards for accounting for uncertainty in income taxes, the guidance and disclosure amendments are effective for financial statements issued for interim and annual periods ending after September 15, 2009. The adoption of this Update did not have a material impact on the Company’s financial statements and disclosures.

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5. COMPREHENSIVE LOSS

The components of comprehensive loss are as follows:

The foreign currency translation adjustments are not currently adjusted for income taxes as the Company’s operating subsidiary is located in Canada and the adjustments relate to the translation of the financial statements from Canadian dollars into United States dollars, which are done as disclosed in note 4 (g).

6. PREPAID EXPENSES AND OTHER

Included in prepaid expenses and other is an amount of $11,083 (CDN$11,258) (prior year: $4,254 (CDN$5,075)) being Goods & Services tax receivable from the Federal Government of Canada. Included in prepaid expenses and other is also a deposit of $nil (prior year: $8,597 (CDN$10,256)) with a contractor for diamond drilling at drill sites to be selected by the Company. Also included in prepaid expenses and other is a deposit of $nil (prior year: $15,088 (CDN$18,000)) with a company for consulting advice on mergers and acquisitions.

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7. DEMAND LOAN FROM DIRECTOR

The Company received loans for $64,500 on September 21, 2009 and $37,500 on October 5, 2009 for a total of $102,000 from a director of the Company which carries simple interest at the rate of seven percent (7%) of the outstanding principal balance per annum. The entire principal balance outstanding and any interest thereon shall be payable on demand by the holder of the Promissory Notes, but no later than three years from the date of the loan. The Company has accrued interest payable of $4,242 as of April 30, 2010.

8. PROPERTY, PLANT AND EQUIPMENT

During the years ended April 30, 2010 and April 30, 2009, the Company reviewed the impairment on property, plant and equipment and wrote down a total of $nil and $88,069 respectively from the cost. Several factors are taken into account for such write down, including but not limited to, management’s plans for future operations and projected undiscounted cash flows. Amortization for the year ended April 30, 2010 and April 30, 2009 amounted to $11,315 and $33,769 respectively.

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9. ACCOUNTS PAYABLE AND ACCRUED LIABILITIES

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10. CAPITAL STOCK

a) Authorized

150,000,000 Common shares, $0.0001 par value (150,000,000 in 2008)

b) Issued

41,839,535 Common shares (40,489,535 in 2009)

c) Changes to Issued Share Capital

Year ended April 30, 2010

The Company received subscriptions for 1,100,000 common shares at $0.04 per share for a total consideration of $44,000 through a non-brokered private placement. The Company issued 1,100,000 common shares.

On September 28, 2009 the Company entered into an employment agreement (“Agreement”) with Douglas Oliver (the “Employee”) to serve as its President and Chief Executive Officer. As per the terms of the said agreement, the Company issued to the employee 250,000 common shares of the Company’s common stock, The Employee acknowledges that such shares will be “restricted shares” subject to limitations on re-sale. The Employee further acknowledges that he will be considered as affiliate for purposes of Rule 144.

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10. CAPITAL STOCK-CONT'D

c) Changes to Issued Share Capital-cont'd

Year ended April 30, 2009

On July 7, 2008, the Company issued 476,189 common shares in settlement of a property payment on the Mount Hinton property. These shares represent $58,887 (CDN$60,000), which is 40% of the contracted payment, and were valued at $0.123 (CDN$0.126) each. The balance of the property payment in the amount of $88,330 (CDN$90,000) was paid in cash.

On May 16, 2008, the Company entered into a consulting agreement with Clarke Capital Group Inc. (“Clarke”) pursuant to which Clarke was retained to provide the Company with investor relations and business communications services for an initial term of 6 months, renewable thereafter for an additional 6-month term. Upon execution of the Clarke Agreement the Company paid Clarke $14,648 (CDN$15,000). Pursuant to the Clarke Agreement, the Company issued Clarke 50,000 shares of common stock on July 14, 2008 which was valued at market price for $7,500.

On July 23, 2008, the Company closed a non-brokered private placement to $976,563 (CDN$1,000,000). The Company completed the sale of 4,134,000 common shares on a flow-through basis at a price of $0.15 (CDN$0.15) per share for gross proceeds of $613,778 (CDN$620,100). The Company paid a 5% finders fee on this private placement. The private placement was exempt from registration under the Securities Act of 1933, pursuant to an exemption afforded by Regulation S. The flow-through shares were issued at market without any additional price charged for sale of taxable benefits.

The Company assumed the rights to acquire the Marg Property under a Property Purchase Agreement (“Agreement”) with Atna Resources Ltd. (“Atna”). The Company had agreed to make subsequent payments under the Agreement of: $163,066 (CDN$200,000) in cash and/or common shares of the Company (or some combination thereof to be determined) on or before December 12, 2008. On December 4, 2008 the Company and Atna Resources Ltd. (“Atna”) entered into a letter agreement (the “Amendment Agreement”) amending the purchase agreement by which the Company acquired its Marg Property (the “Marg Acquisition Agreement”). Under the terms of the Marg Acquisition Agreement the Company was required to pay to Atna $163,066 (CDN$200,000) (in cash or shares of the Company’s common stock) on December 12, 2008. In lieu of making such payment, the Amendment Agreement permits the Company to pay Atna $19,980 (CDN$25,000) in cash on December 12, 2008 (paid) and $188,600 (CDN$225,000) (payable in cash or shares of the Company’s common stock) on April 30, 2009. On April 30, 2009, the Company issued to Atna 6,838,906 common shares which represent $188,600 (CDN $225,000), whereby common shares were valued at $0.0276 (CDN $0.0329) each.

F-21

10. CAPITAL STOCK-CONT'D

d) Purchase Warrants

The Company did not issue any stock purchase warrants during the years ended April 30, 2010 and April 30, 2009 respectively.

The warrants do not confer upon the holders any rights or interest as a shareholder of the Company.

At April 30, 2010 and April 30, 2009, the weighted average contractual term of the total outstanding, and the total exercisable warrants were as follows:

F-22

11. STOCK BASED COMPENSATION

Per SEC Staff Accounting Bulletin 107, Topic 14.F, “Classification of Compensation Expense Associated with Share-Based Payment Arrangements” stock based compensation expense is being presented in the same lines as cash compensation paid.

The Company adopted a new Stock Option Plan at its shareholders meeting on January 19, 2007 (the “2006 Stock Option Plan”). The 2006 Stock Option Plan will be administered by the board of directors of the Company or, in the board of directors’ discretion, by a committee appointed by the board of directors for that purpose. The TSX approved the 2006 Stock Option plan on March 9, 2007.

Subject to the provisions of the 2006 Stock Option Plan, the aggregate number of shares which may be issued under the 2006 Stock Option Plan shall not exceed 2,000,000 shares ("Total Shares"). On March 18, 2008 at the Annual and Special Meeting of Shareholders, the Shareholders of the Company approved an amendment to the 2006 Stock Option Plan increasing the number of Shares reserved for issuance there under from 2,000,000 to 2,899,044. Any Stock Option granted under the 2006 Stock Option Plan which has been exercised shall again be available for subsequent grant under the 2006 Stock Option Plan, effectively resulting in a re-loading of the number of shares available for grant under the 2006 Stock Option Plan. Any shares subject to an option granted under the 2006 Stock Option Plan which for any reason is surrendered, cancelled or terminated or expires without having been exercised shall again be available for subsequent grant under the 2006 Stock Option Plan.

Under the 2006 Stock Option Plan, at no time shall: (i) the number of shares reserved for issuance pursuant to Stock Options granted to any one optionee exceed 10% of the Total Shares; (ii) the number of shares, together with all security based compensation arrangements of the Company in effect, reserved for issuance pursuant to Stock Options granted to any "insiders" (as that term is defined under the Securities Act (Ontario)) exceed 10% of the total number of issued and outstanding shares. In addition, the number of shares issued to insiders pursuant to the exercise of Stock Options, within any one year period, together with all security based compensation arrangements of the Company in effect, shall not exceed 10% of the total number of issued and outstanding shares.

F-23

11. STOCK BASED COMPENSATION-CONT'D

The purchase price (the “Price”) per share under each Stock Option shall be determined by the board of directors or a committee, as applicable. The Price shall not be lower than the closing market price on the TSX, or another stock exchange where the majority of the trading volume and value of the Shares occurs, on the trading day immediately preceding the date of grant, or if not so traded, the average between the closing bid and asked prices thereof as reported for the trading day immediately preceding the date of the grant; provided that if the shares have not traded on the TSX or another stock exchange for an extended period of time, the “market price” will be the fair market value of the shares at the time of grant, as determined by the board of directors or committee. The board of directors or committee may determine that the Price may escalate at a specified rate dependent upon the date on which an option may be exercised by the Eligible Participant.

Options shall not be granted for a term exceeding ten years (the “Option Period”).

Year ended April 30, 2009.

During the year ended April 30, 2009, the following stock options were granted under the 2006 stock option plan:

On July 28, 2008 the board of directors granted options to a consultant to acquire 250,000 shares, to vest 50,000 immediately and the balance of 50,000 each at three-month intervals. These options can be exercised over a period of five (5) years. The exercise price was set at $0.15 (CDN$0.15) per share. These options were granted under the Company’s 2006 stock option plan. On December 12, 2008, the Company and the consultant mutually agreed to terminate the agreement effective October 31, 2008 and cancelled the 250,000 options on January 31, 2009.

Year ended April 30, 2010

The company did not issue any stock options during the year ended April 30, 2010.

F-24

11. STOCK BASED COMPENSATION-CONT'D

Cancellation/Expiration/Forfeiture of Stock Options :

Year ended April 30, 2010.

On June 24, 2009 200,000 stock options held by a former officer were forfeited.

On August 4, 2009 340,000 stock options held by a former director were forfeited.

On October 24, 2009 the Company cancelled 200,000 stock options held by a former officer.

On December 15, 2009 250,000 stock options held by a former director expired.

On January 5, 2010 12,000 stock options held by an officer expired.

On January 19, 2010 350,000 stock options held by a former director were forfeited.

On January 29, 2010 400,000 stock options held by a former director were forfeited.

Year ended April 30, 2009

On June 11, 2008, 200,000 stock options held by a former officer were forfeited.

On December 12, 2008, the Company and a consultant mutually agreed to terminate the consulting agreement effective October 31, 2008, which resulted in the cancellation of 250,000 stock options on January 31, 2009.

On March 11, 2009 150,000 stock options held by a former director were forfeited.

F-25

11. STOCK BASED COMPENSATION-CONT'D

For the year ended April 30, 2010, the Company has recognized in the financial statements, stock-based compensation costs as per the following details. The fair value of each option used for the purpose of estimating the stock compensation is based on the grant date using the Black-Scholes option pricing model with the following weighted average assumptions:

F-26

11. STOCK BASED COMPENSATION-CONT'D

As of April 30, 2010 there was $nil of unrecognized expenses related to non-vested stock-based compensation arrangements granted. The stock-based compensation expense for the years ended April 30, 2010 and April 30, 2009 was $11,315 and $31,858 respectively.

The following table summarizes the options outstanding as at April 30:

F-27

11. STOCK BASED COMPENSATION-CONT’D

At April 30, 2010 and April 30, 2009, the weighted average contractual term of the total outstanding, and the total exercisable options under the Stock Option Plan were as follows:

F-28

12. SALE OF MOUNT HINTON MINING PROPERTY CLAIMS

On May 21, 2009, the Company, through its wholly owned subsidiary, YGC, sold its interest in the Mount Hinton Property to the Hinton Syndicate. All of the claims comprising the Mount Hinton Property were conveyed by the Company’s subsidiary to a member of the Hinton Syndicate. The Hinton Syndicate paid the Company (i) $110,306 (CDN$125,000) on May 21, 2009 and (ii) granted to the Company’s subsidiary a 2% “Net Smelter Royalty (an “NSR”) on the Mount Hinton Property claims. Such 2% NSR may be terminated at any time by payment to Yukon Gold of the following:

In addition, Yukon Gold’s subsidiary assigned its work permit to a member of the Hinton Syndicate and the Hinton Syndicate became responsible for any reclamation costs imposed by the government of Yukon in connection with the work permit. As of May 21, 2009, the Company has no further interest or obligations with respect to this property.

13. SHORT-TERM INVESTMENT IN AVAILABLE- FOR- SALE SECURITIES

Year ended April 30, 2008

The Company entered into a subscription agreement dated as of April 3, 2007 (the “Agreement”) with Industrial Minerals, Inc. (“Industrial Minerals”) to acquire (i) 5,000,000 common shares of Industrial Minerals at a price of $0.05 per share and (ii) a Warrant entitling the holder: (a) to purchase 5,000,000 common shares of Industrial Minerals at a purchase price of $0.05 per share (the “option price”) or, at the option of the holder, (b) to surrender the Warrant for a number of common shares to be determined by application of an anti-dilution formula which would result in a larger number of shares issued to the holder if the market price of the common stock is less than the option price at the time of exercise. The Warrant expired on April 3, 2008. The total subscription price paid by the Company was $250,000. The Company entered into the Agreement as of May 14, 2007. The common stock of Industrial Minerals is quoted on the Over-the-Counter Bulletin Board under the symbol, “IDSM.” The Company accounted for this investment as a short term investment in available-for-sale securities. On August 17, 2007, the Company entered into an agreement with Global Capital SPE-1 LLC (“Global”) pursuant to which Global agreed to purchase 2 million shares of Industrial Minerals Inc. (“IDSM”) held by the Company for consideration of $140,000. Pursuant to the Agreement, Global had the option to purchase from the Company an additional 3 million shares of IDSM for consideration of $210,000. The Company also assigned to Global 5 million warrants to purchase IDSM stock. The Company will receive up to $100,000 in the event that Global exercises all or a portion of the warrants. Global consummated the purchase of the first 2 million shares of IDSM on September 6, 2007 and another 1,000,000 shares on January 30, 2008 and paid the Company a total of $210,000. The Company accounted for $60,000 as realized gain on sale of securities to Global as a credit to the general and administrative expenses and reduced the unrealized gain of $100,000 to $40,000.

F-29

13. SHORT-TERM INVESTMENT IN AVAILABLE- FOR- SALE SECURITIES-CONT'D

During the periods of March and April 08, the Company sold an additional 1,550,000 common shares in the open market for a total consideration of $130,040.

The Company accounted for $60,000 as realized gain on sale of securities to Global as a credit to the general and administrative expenses and reduced the unrealized gain of $100,000 to $40,000. During the periods of March and April 08, the Company sold an additional 1,550,000 common shares in the open market for a total consideration of $130,040.

The Company accounted for $52,540 as realized gain on sale of securities in the open market as a credit to the general and administrative expense and reduced the unrealized gain further by $31,000 to $9,000.

Year ended April 30, 2009

During the year ended April 30, 2009, the Company sold the balance of 450,000 shares of Industrial Minerals, Inc. at an average selling price of $.0655 for a total consideration of $29,460 in the open market

14. COMMITMENTS AND CONTINGENCIES

The Marg Property

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

The Company assumed the rights to acquire the Marg Property under a Property Purchase Agreement (“Agreement”) with Atna Resources Ltd. (“Atna”). Under the terms of the Agreement the Company paid $119,189 (CDN$150,000) cash and 133,333 common shares as a down payment. The Company made payments under the Agreement for $43,406 (CDN$50,000) cash and an additional 133,333 common shares of the Company on December 12, 2005; $86,805 (CDN$100,000) cash and an additional 133,334 common shares of the Company on December 12, 2006. On December 12, 2007 the Company paid $98,697 (CDN$100,000) being the next payment then due.

The Company agreed to make subsequent payments under the Agreement of: $167,645 (CDN$200,000) in cash and/or common shares of the Company (or some combination thereof to be determined) on or before December 12, 2008. On December 4, 2008 the Company and Atna Resources Ltd. (“Atna”) entered into a letter agreement (the “Amendment Agreement”) amending the purchase agreement by which the Company acquired its Marg Property (the “Marg Acquisition Agreement”). Under the terms of the Marg Acquisition Agreement the Company was required to pay to Atna $167,645 (CDN$200,000) (in cash or shares of the Company’s common stock) on December 12, 2008. In lieu of making such payment, the Amendment Agreement permitted the Company to pay Atna $19,980 (CDN$25,000) in cash on December 12, 2008 (paid) and $188,600 (CDN$225,000) (payable in cash or shares of the Company’s common stock) on April 30, 2009. On April 30, 2009, the Company issued to Atna 6,838,906 common shares which represent $188,600 (CDN $225,000), whereby the common shares were valued at $0.0276 (CDN$0.0329) each. Upon the commencement of commercial production at the Marg Property, the Company will pay to Atna $935,191 (CDN$1,000,000) in cash and/or common shares of the Company, or some combination thereof to be determined.

On April 2, 2007 the Company accepted a proposed work program, budget and cash call schedule for the Marg project. The Company has paid cash calls in the amount of $2,100,528 (CDN$2,281,880) for the 2007 Work Program. The Company had approximately $515,561 (CDN$550,000) on deposit left over from the 2006 cash call schedule. On May 15, 2007 the Company paid $703,037 (CDN$750,000), on June 15, 2007 the Company paid $703,037 (CDN$750,000), and on July 15, 2007 the Company paid $703,037 (CDN$750,000) being three of the four cash call payments.

F-30

14. COMMITMENTS AND CONTINGENCIES-CONT’D

The fourth and final payment of $402,244 (CDN$380,000) was paid on August 15, 2007. On August 31, 2007 the Company re-allocated $537,864 (CDN$508,120) being the balance of the third cash call payment for the Mount Hinton 2007 Work Program from cash call funds previously allocated to the Marg Project. These re-allocated funds were not needed for the Marg Project. On January 23, 2008 the Company was refunded $388,524 (CDN$390,000) as these funds were not needed for the Marg Project.

On September 17, 2009, the Company, Bellhaven Copper and Gold, Inc. (“Bellhaven”) and Minera Cerro Quema S.A., a private company organized under the laws of Panama that is a subsidiary of Bellhaven (“Minera”) fully executed a Memorandum of Understanding (the “MOU”) dated as of September 15, 2009 pursuant to which Bellhaven granted to the Company an option to buy a 75% equity interest in Minera. Minera owns the Cerro Quema development stage gold project located the Tonosi, Province of Los Santos, Republic of Panamá. The MOU called for a 60-day due diligence period during which the Company was required to make a series of non-refundable deposits totaling $400,000 as milestones for due diligence and development of definitive documents . The total consideration for the Minera interest was $19,915,000, which included the purchase price and project financing to be provided by the Company. Upon exercise of the "Option to Purchase" Yukon Gold would own 75% of the outstanding shares of Minera and Bellhaven would hold the remaining 25%. The Property was also subject to a 2% NSR (net smelter royalty) in favor of Compania de Exploracion Minera S.A. and a 9% NPI in favor of Bellhaven. Yukon Gold agreed to purchase the 9% NPI from Bellhaven for consideration of $75,000, payable at Closing. While it performed due diligence, the Company was seeking financing for the transaction. On September 21, 2009 the Company paid $37,500 of the $75,000 being the first non-refundable due diligence deposit milestone. October 5, 2009 the Company paid the balance $37,500. During the quarter ended January 31, 2010 the Company was unable to complete its due diligence, or to make the balance of the non-refundable due diligence deposits, or to raise the $19,915,000. On November 13, 2009 Bellhaven issued a press release stating that they were terminating the MOU with the Company. The Company expensed $75,000 to General and Administration expense.

On October 1, 2009 the Company’s board of directors ratified a retainer agreement (the “Agreement”) dated August 28, 2009 with a Panamerican corporation (the “Consultant”) to provide certain exclusive advisory services for financing, acquisition, collaboration, product or services sales transactions and strategies, for a period of twelve (12) months (the “Term”) from the date of execution. If at any time during the Term the Company wishes to terminate the exclusivity of the Consultant, the Company will give the Consultant ten (10) days prior written notice and pay the Consultant $200,000. The Agreement states that a monthly cash fee of $50,000 and the Consultant’s out-of-pocket expenses shall accrue and be payable only at such time as the Company secures a minimum of $5,000,000 in financing during the Term of this agreement at which time the total amount accrued shall be due and payable in full without interest. In the event that the Company fails to timely pay any of the compensation, as defined in the Agreement, each shall bear interest at the rate of six percent (6%) until paid in full. The Consultant has the right upon written notice to the Company of its election to receive gold or other minerals in lieu of cash prior to or concurrent with the closing of any financing transactions (“Financing Transactions”). Compensation payable in kind shall not bear any interest.

F-31

14. COMMITMENTS AND CONTINGENCIES-CONT'D

If an acquisition or divestiture is consummated during the Term of the Agreement or for a period of one (1) year thereafter, the Company shall pay a transaction fee (“TF”) to the Consultant based on the following transaction values (“TVs”): (i) 5% TF up to and including $1,000,000 TVs, plus (ii) 4% TF on all TVs from $1,000,000 to $1,999,999, plus (iii) 3% TF on all TVs from $2,000,000 to $2,999,999, plus (iv) 2% on all TVs from $3,000,000 to $3,999,999, plus (v) 1% on all TVs from $4,000,000 to $4,999,999, plus (vi) 1% on all TVs equal to and exceeding $5,000,000. During the Term of the Agreement or for a period of one (1) year after termination, the Company will pay the Consultant a finder’s fee equal to two percent (2%) of the total amount of each and every Financing Transaction successfully undertaken by the Company. In addition the Company shall grant to the Consultant options to purchase that number of shares of the Company’s common stock determined by multiplying two percent (2%) equal to the total number of equity shares placed/and or issued, or if convertible debt, two percent (2%) of the number of common equity shares as if the convertible debt was converted at its earliest possible date. Such options shall be exercisable for a period of five (5) years at an exercise price equal to the five-day weighted average trading price (WATP) for the five (5) consecutive trading days immediately prior to the granting of the Company’s stock options. In addition to the foregoing fees, the Company shall grant to the Consultant a fully-vested option (“Equity Fee”) to acquire a number of shares equal to eight and one-half percent (8.5%) of the total common shares issued and outstanding at the time of the execution of the Agreement. Such options shall be exercisable for a period of five (5) years at an exercise price equal to the five-day WATP for the five (5) consecutive trading days immediately prior to the granting of the Company’s stock options. The number of stock options shall be subject to any and all adjustments of the common shares during the five-year exercise period. Upon the Company entering into any definitive agreement, during the Term, to acquire any properties/projects, as defined in the Agreement, an additional fully-vested performance option shall be granted to the Consultant to acquire a number of shares equal to eight and one-half percent (8.5%) of the then issued and outstanding common shares of the Company. Such options shall be exercisable for a period of five (5) years at an exercise price equal to the five-day WATP for the five (5) consecutive trading days immediately prior to the execution of the definitive agreement. The number of performance options shall be subject to any and all adjustments of the common shares during the five-year exercise period. If any acquisition transaction is contemplated by the Company during the Term or for a period of one (1) year after the Company will grant to the Consultant the absolute right to participate, on a pro rata basis, in up to a ten percent (10%) interest in the Company’s acquisition. The Consultant shall also be responsible for all pro rata future development and operating costs of said acquisition when paid by the parties owning the other 90% interests. Notwithstanding anything within the Agreement to the contrary, any stock or equity-based compensation must be pre-cleared by the Toronto Stock Exchange (TSX). If any Financing Transaction(s) described in paragraphs 2 A and B of Schedule A to this Agreement are concluded during the Term, or for a period of one (1) year thereafter, provided such Financing Transaction(s) results from parties identified in writing by the Consultant in performing the Services, the Company will pay to the Consultant, or a designee of the Consultant, the following: (i) with respect to any equity financing, a cash fee equal to seven percent (7%) of the total amount of the Financing Transaction (gross proceeds, without offset for costs or fees), (ii) with respect to any debt financing, a cash fee equal to four percent (4%) of the total amount of such Financing Transaction (gross proceeds, without offset for costs or fees), and (iii) in addition, upon the completion of any Financing Transaction of the Company or its, parents, subsidiaries or affiliates, the Company shall grant to the Consultant the right and option to purchase that number of shares, units or interests in the Company determined by dividing five percent (5%) of the amount of the Financing Transaction by an amount equal to equal to the five-day WATP for the five (5) consecutive trading days immediately prior to the payment of Yukon Gold Corporation stock options.

F-32

14. COMMITMENTS AND CONTINGENCIES-CONT'D

Such rights shall be exercisable, for a period of five (5) years, from date of issue and shall possess “most favored nation” registration rights, i.e., registration rights equal to the best/most favorable rights/treatment of any issued/outstanding registration rights provisions applicable to any securities of the Company, specifically including, but not limited to demand and “piggy back” registration rights, including the right to include such shares in any offering undertaken by the Company, i.e., “tag-along” rights. Such Fee shall be paid by the Company to the Consultant within ten (10) calendar days after the closing of each Financing Transaction, or, if such Financing Transaction closes in several tranches, within ten (10) calendar days after the closing of each tranche, until paid in full.

On October 1, 2009 the Company’s board of directors ratified a letter agreement dated September 10, 2009 with a former officer to act as an agent to facilitate the sale of the Company’s Marg property and to secure bridge loan financing. The Company has agreed to pay the agent a fee equal to five percent (5%) of the transaction value of each completed transaction. The letter agreement has a term of three months. On December 10, 2009 the letter agreement terminated.

On October 1, 2009 the Company’s board of directors ratified a consulting agreement (the “Agreement”), dated September 20, 2009, with an individual to provide services as a special advisor (the “Consultant”). The Agreement states that the Consultant will receive 450,000 restricted common shares no later than ten (10) business days from the date of signing the Agreement. During the quarter and subsequent to the period ended January 31, 2010, the Company has not issued these shares to the Consultant but the Company has expensed the cost at fair value. The Consultant is entitled to receive a cash fee of two and one-half percent (2.5%) on the aggregate value of a financing(s) or transaction(s) entered into by the Company during the term of the Agreement or within the twelve (12) months following the term of this Agreement if the discussions regarding the financial transaction(s) were initiated by the Consultant during the term of this Agreement. Further it was agreed that the Consultant would receive a bonus of up to 1,000,000 restricted common shares of the Company of any financing or transaction, such bonus to be awarded on transactions values (“TV”) as follows: (i) up to a $1,000,000 TV, 200,000 shares (ii) between a $1,000,000 up to a $6,000,000 TV, an additional 300,000 shares and (iii) over a $6,000,000 TV, an additional 500,000 shares. Upon receipt of an itemized invoice the Consultant will be reimbursed for all traveling and other actual legitimate expenses. The Agreement is for a three month minimum term and may be extended by the mutual agreement of both parties in writing. On December 20, 2009 the agreement terminated and the Consultant was not successful in raising any financing.

On October 1, 2009 the Company’s board of directors ratified an engagement letter dated September 24, 2009 with two limited market dealers (collectively referred to herein as the “Agents”) to arrange a bridge financing, within two weeks of signing the engagement letter, in the amount of $500,000 related to the $400,000 due diligence payments agreed to in the Bellhaven MOU and to provide working capital. In exchange for the Agents successfully completing the bridge financing the Company agreed to pay the Agents collectively a fee of ten percent (10%) and issue common share purchase warrants (“Broker Warrants”) equal to ten percent (10%) of the total units sold by the Agents under the financing. Each Broker Warrant entitles the holder to acquire one additional common share of the Company for a period of 24 months from the date of issue exercisable at a price of $0.05 per share. The Company also agreed to reimburse the Agents for out of pocket expenses. The engagement letter has a term of six months and is non-exclusive. Either party may terminate the agreement upon 30 days written notice. As of the date of these statements, the Agents were not successful in raising any of the $500,000.

F-33

14. COMMITMENTS AND CONTINGENCIES-CONT'D

On September 28, 2009 the Company entered into an employment agreement (“Agreement”) with Douglas Oliver (the “Employee”) to serve as its President and Chief Executive Officer. During the employment term, the Company will pay the Employee a base salary at the annual rate of one hundred and eighty thousand ($180,000) dollars per year ("Base Salary"). Half of the Employee’s Base Salary shall be deferred and shall accrue interest at the LIBOR rate plus five percent (5%). Deferred Base Salary shall be payable to the Employee with interest no sooner than the Cerro Quema gold project entering production but may be further deferred at the Employee’s discretion. In the event that this Agreement is terminated for any reason, the Employee shall be entitled to all deferred Base Salary, with interest, to be paid within three (3) months of such termination. The Agreement further states that the Employee immediately shall be awarded 250,000 shares of the Company’s common stock, which were issued in the last quarter of the year. The Employee acknowledges that such shares will be “restricted shares” subject to limitations on re-sale. The Employee further acknowledges that he will be considered as affiliate for purposes of Rule 144. The Company agrees to register such shares as part of any registration statement it files under the Securities Act of 1933. Additional stock options shall be awarded to Employee based upon the Company’s achieving certain production goals and in accordance with the Company’s 2006 Stock Option Plan. Employee and the Company shall agree upon the goals and option amounts within two (2) months of the execution of this Agreement. As of the date of these statements, the option amounts were not agreed upon. The Employee may terminate employment at any time after providing forty-five (45) days’ prior written notice to the Company. The Company may terminate the Employee's employment without cause at any time after providing written notice to Employee and paying all unpaid salaries and benefits. In addition, an amount equal to twelve (12) months of Base Salary (at the rate in effect as of the date of the Employee’s termination without cause) will be paid to the Employee if this Agreement is terminated by the Company at any time prior to the second anniversary of the date of this Agreement.

F-34

14. COMMITMENTS AND CONTINGENCIES-CONT'D

On October 23, 2009 the Company accepted a letter agreement (the “Agreement”) dated October 21, 2009 with an exclusive placement agent (the “Agent”) in connection with the offer and proposed sale (the “Financing(s)”) of the Company’s common shares (the “Equity Securities”) on an Efforts Basis. The Agreement continues until February 21, 2010 (the “Term”) with a further 24-month tail period (the “Tail Period”). For the Agents services the Company agrees to pay a cash placement fee (the “Cash Fee”) equal to seven percent (7%) of the gross proceeds of the Financing(s) completed during the Term, except for those completed under the consulting agreement dated September 20, 2009. In addition the Agent shall also receive broker warrants (the “Broker Warrants”) entitling the Agent to purchase from the Company such number of common shares as is equal to seven percent (7%) of the number of Equity Securities issued in the Financing (together with the Cash Fee set forth herein, the “Financing Fee”). The Broker Warrants shall be assignable and shall expire 24 months from the date of issuance. The exercise price of the Broker Warrants shall be equal to the purchase price of the Equity Securities sold under the Financing. For financings completed under the consulting agreement dated September 20, 2009, the Agent will receive 20% of the fees, cash and broker warrants, paid under said consulting agreement, payable upon closing of the financing. The Agreement states further that the Company grants to the Agent a first right of refusal to act as any future financings for a period of twelve (12) months commencing on the closing of the Financing. The Agreement also states that the Company shall pay to the Agent the Financing Fee in respect of each Financing completed or entered into during the Tail Period. The letter agreement expired on February 21, 2010 and as of the date of these statements, the Agent was not successful in raising any financing.

On October 26, 2009 the Company entered into a letter agreement with a former officer to act as a consultant providing accounting and administration services for $1,969 (CDN$2,000) per month and to warehouse the Company records for $492 (CDN$500) per month. The Company further agreed to reimburse the consultant for any out of pocket expenses and that either party may give 30 days notice in writing of their intention to terminate the letter agreement.

F-35

14. COMMITMENTS AND CONTINGENCIES-CONT'D

The Company subsidiary has been served an Ontario Court order to pay a penalty for $118,269 (CDN $120,138) for early termination for its office lease. The prior landlord had made the said claim in the Ontario Superior Court of Justice.

15. RELATED PARTY TRANSACTIONS

Year ended April 30, 2010

The Company and its subsidiary expensed a total of $5,301 in consulting fees & wages to one Company Director, and $217,693 to five of its officers.

No director or officer exercised stock options during the year ended April 30, 2010.

Year ended April 30, 2009

The Company and its subsidiary expensed a total of $118,407 in consulting fees & wages to five Company Directors, and $301,300 to five of its officers.

No director or officer exercised stock options during the year ended April 30, 2009.

F-36

16. INCOME TAXES

a) Deferred Income Taxes

The Company has deferred income tax assets as follows:

Reconciliation between the statutory federal income tax rate and the effective income tax rate of income tax expense for the period ended April 30, 2010 and 2009 is as follows:

The Company has determined that realization of a deferred tax asset is not likely and therefore a valuation allowance has been recorded against this deferred income tax asset.

b) Current Income Taxes

As of April 30, 2010 the Company has non-capital losses of approximately $13,529,718 available to offset future taxable incomes which expire as follows:

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17. CHANGES IN OFFICERS AND DIRECTORS

On May 4, 2009 Mr. Howard Barth resigned as a director of the Company.

On May 13, 2009 the board of directors of YGC, the Company’s wholly owned Canadian subsidiary, appointed Mrs. Kathy Chapman Corporate Secretary of YGC.

On June 19, 2009 the Company advised Mrs. Lisa Rose that her employment as Corporate Secretary and Administrator was terminated due to the down-sizing of the Company.

On July 10, 2009 the Company advised Mrs. Kathy Chapman that her employment as Chief Administrative Officer of the Company would be terminated effective September 4, 2009 due to the down-sizing of the Company. Mrs. Chapman will remain Interim Corporate Secretary of the Company and Corporate Secretary of YGC, the Company’s wholly-owned Canadian subsidiary.

On September 28, 2009 the board of directors accepted the resignation of J.L. Guerra, Jr. as President and Chief Executive Officer of the Company. Mr. Guerra, Jr. remains the Chairman of the Board of Directors of the Company.

On September 28, 2009 the board of directors appointed Mr. Douglas Oliver President and Chief Executive Officer and a director of the Company.

On September 28, 2009 the board of directors appointed Mr. Paul Pitman Vice President of Corporate Development and Exploration, Corporate Secretary and a director of the Company.

On October 21, 2009 Mr. Paul Pitman resigned as Vice President of Corporate Development and Exploration, Corporate Secretary and a director of the Company.

On October 19, 2009 Mr. Robert Van Tassell resigned as a director and member of the Audit Committee of the Company.

On October 23, 2009 the board of directors appointed Mr. Charles William Reed a director and member of the Audit Committee of the Company.

On October 29, 2009 Mr. Kenneth J. Hill resigned as a director and member of both the Audit and Executive Committee of the Company and as a director of Yukon Gold Corp., the Company’s wholly owned Canadian subsidiary.

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18. FAIR VALUE OF FINANCIAL INSTRUMENTS

The fair values of financial assets and financial liabilities measured in the balance sheet as of April 30, 2010 are as follows:

The fair values of financial assets and financial liabilities measured in the balance sheet as April 30, 2009 are as follows:

Fair value measurements of the Corporation’s cash are classified under Level 1 because such measurements are determined using quoted prices in active markets for identical assets.

Fair value measurements of accounts payable and accrued liabilities, Loan from Director and obligations under capital lease are classified under Level 3 because inputs are generally unobservable and reflect management’s estimates of assumptions that market participants would use in pricing the asset or liability.

19. SUBSEQUENT EVENTS

On June 17, 2010 the Company’s financial institution received a Notice of Garnishment from the Ontario Superior Court of Justice, Canada, dated June 15, 2010, in the amount of $118,269 (CDN$120,138) with the previous landlord named as the creditor, the Company’s wholly owned Canadian subsidiary (YGC) named as the debtor, and the Company’s financial institution as the garnishee. YGC did not have the funds to settle the Notice of Garnishment.

The Company received loans for $8,000 on June 28, 2010, $7,798 on July 20, 2010 and $9,900 on August 6, 2010 for a total of $25,698 from a director of the Company. The Company issued Promissory Notes to the director which carries simple interest at the rate of seven percent (7%) of the outstanding principal balance per annum. The entire principal balance outstanding and any interest thereon shall be payable on demand by the holder of the Promissory Notes, but no later than three years from the date of the loan.

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PART I

This Annual Report on Form 10-K contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, which include, without limitation, statements about our explorations, development, efforts to raise capital, expected financial performance and other aspects of our business identified in this Annual Report, as well as other reports that we file from time to time with the Securities and Exchange Commission. Any statements about our business, financial results, financial condition and operations contained in this Annual Report that are not statements of historical fact may be deemed to be forward-looking statements. Without limiting the foregoing, the words “believes,” “anticipates,” “expects,” “intends,” “projects,” or similar expressions are intended to identify forward-looking statements. Our actual results could differ materially from those expressed or implied by these forward-looking statements as a result of various factors, including the risk factors described below and elsewhere in this report. We undertake no obligation to update publicly any forward-looking statements for any reason, except as required by law, even as new information becomes available or other events occur in the future.

Item 1. Description of Business.

In this report, the terms “Yukon Gold”, “Company,” “we,” “us” and “our” refer to Yukon Gold Corporation, Inc. The term “common stock” refers to the Company’s common stock, par value $0.0001 per share.

Yukon Gold is an exploration stage mining company. Our objective is to explore and, if warranted and feasible, to develop mineralized material on the mineral claims located in the Mayo Mining District of Yukon, Canada. We hold these claims through our wholly owned subsidiary, Yukon Gold Corp., an Ontario, Canada Corporation (“YGC”). All of our exploration activities are undertaken through YGC. Our mineral claims are referred to herein collectively as the “Marg Property.” We cannot ascertain at this time whether a commercially viable mineral resource exists on the Marg Property.

On May 21, 2009, the Company sold all of its rights to the Mount Hinton Property, as further described in Note 12 in the Consolidated Financial Statements for the year ended April 30, 2010 included in this report.

RISK FACTORS

Yukon Gold has no working capital to maintain its ongoing operations, to prepare and file regular reports required to meet the disclosure requirements of the Securities and Exchange Commission or the Ontario Securities Commission or to meet the requirements of the exchanges on which our stock trades. On August 26, 2009, the Toronto Stock Exchange ("TSX"), announced the de-listing of the Company’s common shares, effective at the close of the market on September 25, 2009. The decision was based upon the Company’s failure to meet multiple listing requirements of TSX. On November 2, 2009 the Company’s common shares began trading on the NEX exchange. Effective at the close of business on April 7, 2010, and in accordance with NEX Policy, section 15, the common shares of Yukon Gold were delisted from NEX, for failure to pay their NEX Listing Maintenance Fee. The Company continues to trade on OTCBB. We run the risk of being de-listed on all exchanges in which our stock currently trades.

Yukon Gold must immediately secure additional financing to remain viable. Management of Yukon Gold believes that we must identify and purchase new mineral properties in order to obtain such financing.

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Yukon Gold has rights in certain mineral claims located in Yukon, Canada. To date we have done limited exploration of the property covered by our mineral claims. We do not have a mine or a mining business of any kind. There is no assurance that we will develop an operating business in the future.

Currently, we have no source of revenue, we do not have working capital to complete our exploration programs (including feasibility studies) and we do not have any commitments to obtain additional financing. We have no operating history upon which an evaluation of our future success or failure can be made. Our ability to achieve and maintain profitability and positive cash flow is dependent upon:

• our ability to raise the capital necessary to conduct this exploration and preserve our interest in these mineral claims;

• our ability to raise capital to develop the Marg Property, establish a mining operation, and operate this mine in a profitable manner; and.

• our ability to raise capital to purchase additional properties that may make our business more attractive to investors in exploration stage mining companies.

Failure to raise the necessary capital to continue exploration and development could cause us to go out of business.

The Company has included a “going concern” qualification in the Consolidated Financial Statements to the effect that we are an exploration stage company and have no established sources of revenue. In the event that we are unable to raise additional capital and/or locate mineral resources, as to which in each case there can be no assurance, we may not be able to continue our operations. Further, the Company subsidiary has a court order to pay a penalty of $118,269 (CDN $120,138) for early termination of its office lease. The prior landlord had made the said claim in the Ontario Superior Court of Justice, Canada. In addition, the existence of the “going concern” qualification in our auditor’s report may make it more difficult for us to obtain additional financing. If we are unable to obtain additional financing, you may lose all or part of your investment.

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, 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.

The Company conducts the majority of its business activities in Canadian dollars. Consequently, the Company is subject to gains or losses due to fluctuations in Canadian currency relative to the US dollar.

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Item 2. Description of Property

The Marg Property

The Marg Property consists of 402 contiguous mineral claims covering approximately 20,000 acres. Access to the claim group is possible either by helicopter, based in Mayo, Yukon Territory, Canada, located approximately 80 km to the southwest or by small aircraft to a small airstrip located near the Marg deposit. A 50 kilometer winter road from Keno City to the property boundary was completed in 1997. The camp site on the property provides accommodation for up to 12 people. Presently the hydroelectric power grid terminates at Keno City some 50km to the southwest and water is available from the Keno Ladue River, which flows through the property.

The rock formations of the Marg property and the immediate area are divided into four major units which are repeated by southeast dipping thrust faults. The two major faults are the Tombstone Thrust and the Robert Service Thrust. One thrust panel contains the Marg Zone mineralization. Within the thrust panel he rocks within the thrust sheets appear to be tabular. The thrust panel containing the Marg Zone is composed of repeated sequences of quartzite, quartz-sericite phyllite and black graphite phyllite. The quartz-sericite phyllite is probably metamorphosed equivalents of volcanic rocks and metasedimentary rocks. The graphite phyllite is the metamorphosed equivalent of a black shale.

Our claims, held in the name of our wholly owned subsidiary “Yukon Gold Corp,” are registered in the Mining Recorders Office in the Mayo Mining District of the Yukon Territory and give us the right to explore and mine minerals from the property covered by the claims. These claims are tabulated below:

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Marg Property Claims
held by
Yukon Gold Corp.

Marg Acquisition Agreement

The following is a description of the Company’s acquisition of the Marg property. On April 30, 2009 the Company completed its acquisition of the Marg property and currently owns it outright.

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In March of 2005, our wholly owned Canadian subsidiary, YGC, acquired from Medallion Capital Corp. (“Medallion”) all of Medallion's rights to purchase and develop the Marg Property which consists of 402 contiguous mineral claims covering approximately 20,000 acres located in the central area of Yukon, Canada. The price paid by the Company was Medallion's cost to acquire the interest. Medallion is owned and controlled by a former director of the Company, Stafford Kelley. The rights acquired by YGC arise under a Property Purchase Agreement between Medallion and Atna Resources Ltd. (“Atna”), hereinafter referred to as the “Marg Acquisition Agreement.” Under the terms of the Marg Acquisition Agreement the Company paid $119,189 (CDN$150,000) cash and 133,333 common shares as a down payment. The Company made payments under the Marg Acquisition Agreement of $43,406 (CDN$50,000) cash and an additional 133,333 common shares of the Company on December 12, 2005; $86,805 (CDN$100,000) cash and an additional 133,334 common shares of the Company on December 12, 2006 and $98,697 (CDN$100,000) in cash on December 12, 2007. The Company agreed to make subsequent payments under the Agreement of: $167,645 (CDN$200,000) in cash and/or common shares of the Company (or some combination thereof to be determined) on or before December 12, 2008. On December 4, 2008 the Company and Atna Resources Ltd. (“Atna”) entered into a letter agreement (the “Amendment Agreement”) amending the purchase agreement by which the Company acquired its Marg Property (the “Marg Acquisition Agreement”). Under the terms of the Marg Acquisition Agreement the Company was required to pay to Atna $167,645 (CDN$200,000) (in cash or shares of the Company’s common stock) on December 12, 2008. In lieu of making such payment, the Amendment Agreement permitted the Company to pay Atna $19,980 (CDN$25,000) in cash on December 12, 2008 (paid) and $188,600 (CDN$225,000) (payable in cash or shares of the Company’s common stock) on April 30, 2009. On April 30, 2009, the Company issued to Atna 6,838,906 common shares which represent $188,600 (CDN$225,000), whereby the common shares were valued at $0.0276 (CDN $0.0329) each. Upon the commencement of commercial production at the Marg Property, the Company will pay to Atna $838,223 (CDN$1,000,000) in cash and/or common shares of the Company, or some combination thereof to be determined.

Our expenditures for exploration on the Marg Property are as follows: On May 16, 2006 the Company accepted a proposed work program, budget and cash call schedule for the Marg Property totaling $1,674,866 (CDN$1,872,500) for the 2006 Work Program. On May 15, 2006 the Company paid $199,016 (CDN$222,500) to the contractor, on June 1, 2006 the Company paid $536,673 (CDN$600,000) to the contractor, and on July 20, 2006 the Company paid $357,782 (CDN$400,000) to the contractor. The fourth payment of $357,782 (CDN$400,000) was paid on August 20, 2006 and the fifth payment of $223,613 (CDN$250,000) paid on September 20, 2006. On April 2, 2007 the Company accepted a proposed work program, budget and cash call schedule for the Marg project totaling $3,026,916 (CDN$3,180,000) for the 2007 Work Program. The Company had approximately $515,561(CDN $550,000) on deposit left over from the 2006 cash call schedule. On May 15, 2007 the Company paid $703,037 (CDN$750,000), on June 15, 2007 the Company paid $703,037 (CDN$750,000), and on July 15, 2007 the Company paid $703,037 (CDN$750,000) being three of the four cash call payments. The fourth and final payment of $402,244 (CDN$380,000) was paid on August 15, 2007. On August 31, 2007 the Company re-allocated $537,864 (CDN$508,120), being the balance of the third cash call payment for the Mount Hinton 2007 Work Program from cash call funds previously allocated to the Marg Project. These re-allocated funds were not needed for the Marg Project. As of January 23, 2008, unused funds of $388,524 (CDN$390,000) were refunded by our work program manager to the Company.

Exploration at Marg Property

The Marg property has had an extensive exploration history with numerous owners and work programs. The area was first staked in 1965 to follow-up anomalous results in a government stream sediment survey. The initial exploration was directed towards finding silver bearing veins but when none were discovered the claims were allowed to lapse. In 1982 the ground was re-staked by a consortium looking for “SEDEX” style lead-zinc mineralization and this resulted in the discovery of the Marg mineralization. In the following years, exploration consisted of geochemical and geophysical surveying, geological mapping, hand trenching and diamond drilling which progressively expanded the limits of the known mineralization. This work was done by various companies who entered into agreements to explore the ground or relinquish their interests. To date a total of 34,203 meters of diamond drilling has been performed on the Marg property.

Yukon Gold started its exploration efforts in 2005 when 1,184.6 meters were drilled in four holes. Exploration continued in 2006 and 2007 when nine holes totaling 2,986 meters and 3,307 were drilled respectively. The programs were managed by Archer Cathro & Associates (1981) and were designed to test the “down-dip” extent of the mineralization. During 2008 the company completed 3,674 meters of drilling in ten holes. There was no drilling during 2009 and 2010.

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Corporate Mailing Office

The Company’s mailing address, as of the date of this report is 139 Grand River Street, N., P.O. Box 510, Paris, Ontario N3L 3T6. The Company currently does not have a corporate office.

Item 3. Legal Proceedings.

On June 17, 2010 the Company’s financial institution received a Notice of Garnishment from the Ontario Superior Court of Justice, Canada, dated June 15, 2010, in the amount of $118,269 (CDN$120,138) with the previous landlord named as the creditor, the Company’s wholly owned Canadian subsidiary (YGC) named as the debtor, and the Company’s financial institution as the garnishee. YGC did not have the funds to settle the Notice of Garnishment. It is possible that one or more other creditors of the Company will bring an action to enforce a debt.

Item 4. Submission of Matters to Vote of Security Holders.

None. Our last annual meeting was held on March 18, 2008.

PART II

Item 5. Market for Common Equity and Related Stockholder Matters.

As of April 30, 2010, there were 41,839,535 shares of common stock outstanding, held by 606 shareholders of record. 40,489,535 common shares were issued and outstanding as of April 30, 2009.

Private Placements of Securities for the Year Ended April 30, 2009

On July 23, 2008, the Company closed a non-brokered private placement for up to $976,563 (CDN$1,000,000). The Company completed the sale of 4,134,000 common shares on a flow-through basis at a price of $0.15 (CDN$0.15) per share for gross proceeds of $613,778 (CDN$620,100). The Company paid a 5% finders fee on this private placement. The proceeds from the private placement of flow-through shares were used by Yukon Gold for program expenditures on the Marg Property and the Mount Hinton Property (then partially owned by the Company). The flow-through shares were issued at market without any additional price charged for sale of taxable benefits. The private placement was exempt from registration under the Securities Act, pursuant to an exemption afforded by Regulation S.

Private Placements for the Year ended April 30, 2010

The Company received subscriptions for 1,100,000 common shares at $0.04 per share for a total consideration of $44,000 through a non-brokered private placement. The Company issued 1,100,000 common shares on April 29, 2010.

Other Sales or Issuances of Unregistered Securities

Year ended April 30, 2009

On July 7, 2008, the Company issued 476,189 common shares in settlement of a property payment on the Company’s former Mount Hinton property. These shares represent $58,887 (CDN$60,000), which is 40% of the contracted payment, and were valued at $0.123 (CDN$0.126) each. The balance of the property payment in the amount of $88,330 (CDN$90,000) was paid in cash.

On May 16, 2008, the Company entered into a consulting agreement with Clarke Capital Group Inc. (“Clarke”) pursuant to which Clarke was retained to provide the Company with investor relations and business communications services for an initial term of 6 months, renewable thereafter for an additional 6-month term. Upon execution of the Clarke Agreement the Company paid Clarke $14,648 (CDN$15,000). Pursuant to the Clarke Agreement, the Company issued Clarke 50,000 shares of common stock on July 14, 2008.

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The Company assumed the rights to acquire the Marg Property under a Property Purchase Agreement with Atna Resources Ltd. (“Atna”). The Company had agreed to make subsequent payments under the Agreement of: $163,066 (CDN$200,000) in cash and/or common shares of the Company (or some combination thereof to be determined) on or before December 12, 2008. On December 4, 2008 the Company and Atna Resources Ltd. (“Atna”) entered into a letter agreement (the “Amendment Agreement”) amending the purchase agreement by which the Company acquired its Marg Property (the “Marg Acquisition Agreement”). Under the terms of the Marg Acquisition Agreement the Company was required to pay to Atna $163,066 (CDN$200,000) (in cash or shares of the Company’s common stock) on December 12, 2008. In lieu of making such payment, the Amendment Agreement permitted the Company to pay Atna $19,980 (CDN$25,000) in cash on December 12, 2008 (paid) and $188,600 (CDN$225,000) (payable in cash or shares of the Company’s common stock) on April 30, 2009. On April 30, 2009, the Company issued to Atna 6,838,906 common shares which represent $188,600 (CDN$225,000), whereby common shares were valued at $0.0276 (CDN$0.0329) each. As a result, the Company owns 100% of the Marg property.

Year ended April 30, 2010

On September 28, 2009 the Company entered into an employment agreement (“Agreement”) with Douglas Oliver (the “Employee”) to serve as its President and Chief Executive Officer. As per the terms of the said agreement, the Company issued to the employee 250,000 common shares of the Company’s common stock on April 29, 2010, The Employee acknowledges that such shares will be “restricted shares” subject to limitations on re-sale. The Employee further acknowledges that he will be considered as affiliate for purposes of Rule 144.

Purchase Warrants

The following table summarizes the warrants outstanding as of the year ended April 30, 2010.