Filed by sedaredgar.com - Crosshair Exploration & Mining Corp.

20-F/A 1 form20fa.htm AMENDMENT NO.1 FOR THE ANNUAL REPORT FOR THE YEAR ENDED APRIL 30, 2007 Filed by sedaredgar.com - Crosshair Exploration & Mining Corp. - Form 20-F/A

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

FORM 20-F/A
(AMENDMENT NO. 1)

[ ] REGISTRATION STATEMENT PURSUANT TO SECTION 12(b) OR (g) OF THE SECURITIES EXCHANGE ACT OF 1934

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

For the fiscal year ended April 30, 2007

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

For the transition period from ____________ to __________

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

Date of event requiring this shell company report____________

Commission file number: 001-33439

CROSSHAIR EXPLORATION & MINING CORP.
(Exact name of Registrant as specified in its charter)

British Columbia, Canada
(Jurisdiction of incorporation or organization)

Suite 1240, 1140 West Pender Street, Vancouver, B.C. Canada V6E 4G1
(Address of principal executive offices)

Mark J. Morabito, President and Chief Executive Officer
Telephone Number: (604) 681-8030
E-Mail: mark@crosshairexploration.com
Facsimile Number: (604) 681-8039
(Name, Telephone, E-Mail and/or Facsimile number and Address of Company Contact Person)

Securities registered pursuant to Section 12(b) of the Act:

Title of each class	Name of Exchange on which registered
Common Shares, without par value	American Stock Exchange

Securities registered pursuant to Section 12(g) of the Act: None

Securities for which there is a reporting obligation pursuant to Section 15(d) of the Act: None

Indicate the number of outstanding shares of each of the issuer's classes of capital or common stock
as of the close of the period covered by the annual report: 70,912,072

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

If this report is an annual or transition report, indicate by check mark if the registrant is not required to file reports pursuant
to Section 13 or 15(d) of the Securities Exchange Act of 1934.
Yes [ ] No [X]

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

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

Large accelerated filer [ ] Accelerated filer [ ] Non-accelerated filer [X]

Indicate by check mark which basis of accounting the registrant has used to prepare the financial statements included in this filing:

U.S. GAAP [ ]	International Financial Reporting Standards as issued	Other [X]
	By the International Accounting Standards Board [ ]

If “Other” has been checked in response to the previous question, indicate by check mark which financial statement item the
registrant has elected to follow:
Item 17 [X] Item 18 [ ]

If this is an annual report, indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the
Exchange Act).
Yes [ ] No [X]

Index to Exhibits on Page 45

EXPLANATORY NOTE

Crosshair Exploration & Mining Corp. (“Crosshair” or the “Company”) is a Canadian issuer eligible to file its annual report pursuant to Section 13 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), on Form 20-F. This Amendment No. 1 on Form 20-F (the “Amendment”) hereby amends Crosshair’s Form 20-F for the fiscal year ended April 30, 2007, as originally filed with the Securities and Exchange Commission (the “SEC”) on October 31, 2007 (the “Original Filing”). The Amendment is being filed solely to address those comments raised by the SEC in its comment letters to the Company dated January 30, 2008 and March 20, 2008, and to incorporate relevant portions of the disclosure contained in the Company’s amended and restated management’s discussion and analysis originally filed by the Company with the SEC as Exhibit 99.2 to Form 6-K on April 11, 2008. This Amendment does not reflect events occurring after the filing of the Original Filing and should not be viewed as updating any information contained therein. Except as described above, no other changes have been made to the Original Filing.

PART I

ITEM 4. INFORMATION ON THE COMPANY

4.A. History and Development of the Company

Introduction

Crosshair Exploration & Mining Corp. was incorporated as a specially limited company pursuant to the Company Act (British Columbia) on September 2, 1966 under the name Shasta Mines & Oil Ltd. (Non-Personal Liability). On March 5, 1986 we converted from a specially limited company into a limited company under the name of International Shasta Resources Ltd. On March 1, 2004 we changed our name to Crosshair Exploration & Mining Corp.

Our executive office is located at:

Suite 1240 - 1140 West Pender Street
Vancouver, British Columbia, Canada V6E 4G1
Telephone: (604) 681-8030
Facsimile: (604) 681-8039
Website: www.crosshairexploration.com
Email: mark@crosshairexploration.com

The contact person is: Mr. Mark J. Morabito, President.

Our fiscal year ends April 30th.

Our common shares first began trading on the Vancouver Stock Exchange under the name Shasta Mines & Oil Ltd. on March 14, 1969. Our common shares have been trading on the TSX Venture Exchange with the trading symbol “CXX” since March 1, 2004. On February 10, 2006, the Company graduated to Tier 1 on the TSX Venture Exchange. On May 7, 2007, our Common Shares began trading on the American Stock Exchange with the trading symbol “CXZ.”

On March 29, 2004, the Company Act (British Columbia) (the “Company Act”) was replaced by the Business Corporations Act (British Columbia) (the “BCBCA”). Accordingly, we are now subject to the BCBCA and are no longer governed by the Company Act. There are a number of differences under the BCBCA, which differences are designed to provide greater flexibility and efficiency for British Columbia companies.

Under the BCBCA, every company incorporated under the Company Act must complete a mandatory transition rollover under the BCBCA to substitute a Notice of Articles for its Memorandum within two years of March 29, 2004. On June 1, 2004 we replaced our Memorandum with a Notice of Articles as is required by the Business Corporations Act (British Columbia). The only information contained in the Notice of Articles is the authorized share structure of the company, the name of the company, the address of the registered and records office of the company, and the names and addresses of the directors of the company. On March 11, 2005, we changed our authorized capital to an unlimited number of common shares.

Property Acquisitions

Since the beginning of fiscal 2007, we have acquired the following properties :

Newfoundland

On May 1, 2006, we entered into an option agreement with Rubicon Minerals Corporation (“Rubicon Minerals”) to earn a 60% interest in the Golden Promise project. On December 8, 2006, Rubicon Minerals spun-off its Newfoundland mineral properties under a plan of arrangement to Paragon Minerals Corporation (“Paragon Minerals”). All references to Paragon Minerals in this report also include its predecessor, Rubicon Minerals, where the context requires. The Golden Promise claims are contiguous with those of our South Golden Promise Property. In order to earn our interest, we must spend $4.0 million over four years (including $750,000 in the first year), issue shares totaling 80,000 (including 20,000 shares in the first year) and make underlying property payments. The budget for the first year after vesting will be capped at $3.0 million unless increased by mutual consent.

On June 7, 2006, we acquired 90 additional claims from Paragon Minerals (originally optioned by Paragon Minerals from local private interests) contiguous with the southwestern portion of the South Golden Promise property in the Victoria Lake region. This is an addendum to the original Victoria Lake Property agreement signed with Paragon Minerals in February, 2003. We can earn a 60% interest in the additional 90 claims by maintaining the claims in good standing and making cash payments totaling $95,000 to the property vendors. The property vendors also maintain a 2.5% Net Smelter Return Royalty (NSR) on the property.

In July 2007, we staked an additional 34 claims contiguous with the South Golden Promise property boundary, which are subject to the terms and conditions of the option agreement signed with Paragon Minerals.

Labrador

In May 2007, we entered into an agreement with Belmont Resources Inc. and International Montoro Resources Inc. whereby we acquired the option to earn a 75% interest in 139 additional claims comprising four different mineral licences in the Central Mineral Belt of Labrador totaling 34.75 km. Three of the licences, referred to as the Stormy Lake block, are contiguous with the southern boundary of the Central Mineral Belt Project, while the other licence, referred to as the Partridge River block, is situated approximately 95 km west of the property. Under the terms of the agreement, we may earn a 75% interest in the claims by carrying out $800,000 in exploration expenditures and issuing 175,000 common shares to the vendors over a three year period.

Between April and July 2007, we staked an additional 120 claims contiguous with the Central Mineral Belt project boundaries, bringing the total number of claims to 2,999 covering 74,975 hectares. A total of $24,000 in eligible exploration expenditures must be spent on these claims before July 2008.

Property Terminations

We have not terminated our options in any of our properties since the beginning of fiscal 2007.

Capital Expenditures

Our capital expenditures, excluding property, plant and equipment, for the last three fiscal years were as follows:

Fiscal Year	Expenditures

Fiscal 2005	$1,566,346⁽¹⁾

Fiscal 2006	$1,435,954⁽²⁾

Fiscal 2007	$10,631,531⁽³⁾

____________________

(1)	These funds were spent as outlined below (Note - The total amount includes acquisition costs of $245,000, which were paid in common shares and not cash.):

		Glenwood		Wings Point-		South		North Paul’s			Beigou		Central
		Break		Titan		Golden		Pond Gold			Gold		Mineral Belt		DJ Gold
Expense ($)		Property		Property		Promise		Property			Property		Project		Property
Drilling and Trenching	$	51,712	$	126,550	$	13,076	$	2,008			--		--		--
Geology		171,706		7,270		143,655		30,756		$	64,473	$	193,243	$	6,349
Geophysics		44		2,346		23,500		11,154			--		83,137		--
Admin.		19,671		20,111		19,025		2,917			23,305		20,201		720
Technical analysis		80,219		31,232		71,449		16,043			304		41,919		937
Acquisition costs		25,000		34,360		25,000		20,000			83,362		260,000		28,580
Write off of mineral property		--		--		--		(109,878	)		--		--		(79,110	)

(2)	These funds were spent as outlined below:

														Central
		Glenwood			Wings			South			Beigou			Mineral			Otter/Portage
		Break			Point-Titan			Golden			Gold			Belt			Lake		Sinbad
Expense ($)		Property			Property			Promise			Property			Project			Properties		Claims
Drilling and trenching	$	32,349			--		$	37,929			--		$	323,008			--		--
Geology		73,089		$	10,872			145,301		$	41,410			541,753		$	400	$	8,597
Geophysics		3,562			--			98,112			--			1,085,376			--		--
Administration		4,188			2,463			36,148			17,081			152,555			--		--
Technical analysis		22,438			104			110,393			--			87,725			--		--
Acquisition costs		--			--			82,000			--			290,000			70,000		4,125
Credits received		(36,693	)		(31,326	)		(22,150	)		--			(266,300	)		--		--
Write-off of mineral
properties		(884,096	)		(374,522	)		--			(229,935	)		--			--		--

(3)	These funds were spent as outlined below:

					Central
		South	Golden		Mineral	Otter/Portage
		Golden	Promise		Belt	Lake	Sinbad
Expense ($)		Promise	Property		Project	Properties	Claims
Drilling and trenching	$	514,059	640,629	$	2,474,435	94,698	--
Geology		78,338	32,738		2,070,123	34,741	3,127
Geophysics		79,961	--		2,278,608	62,900	--
Administration		42,743	54,301		343,171	7,765	--
Technical analysis		40,189	17,336		432,758	8,261	--
Acquisition costs		223,500	110,400		710,000	276,750	--
Credits received		--	--		--	--	--

We expect to incur capital expenditures of approximately $12,000,000 for fiscal year 2008. Our capital expenditures have been financed through sales of our Common Shares.

4.B. Business Overview

Historical Corporate Development

We are a mineral exploration company engaged in the acquisition and exploration of mineral properties (primarily uranium, base and precious metals). We do not have any producing mineral properties at this time. Our business is presently focused on the exploration and evaluation of various mineral deposits in North America.

We are currently focusing our exploration activities on the following properties:

South Golden Promise, Victoria Lake and Golden Promise properties located in Newfoundland, Canada, acquired through option agreements with Paragon Minerals in February 2003 and May 2006.
Central Mineral Belt properties located in Labrador, Canada, acquired through separate option agreements in November 2004 (amended March 2005), December 2005 and May 2007, as well as through claim staking.

We are currently considering a strategy of combining the Golden Promise project, the South Golden Promise project and our Victoria Lake project into a new company, which could be spun out to our shareholders. Such a strategy would allow us to focus exclusively on our Central Mineral Belt Labrador uranium projects. Our implementation of such a strategy will depend on our exploration results and prevailing market conditions. However, we may also decide to not implement this strategy.

During fiscal 2006, we decided not to pursue exploration on certain properties. In this regard, the option-JV agreements with Paragon Minerals for the Glenwood Break and Wings Point-Titan properties were terminated and related property costs were written off. During fiscal 2005, we announced that we had completed a formal joint venture with the Liaoning Non-ferrous Geological Bureau in China for the Beigou Gold Project. However, during the third quarter of 2006, we decided to shift our main focus to our Newfoundland and Labrador properties and as a result decided not to continue with the Beijou Gold Property in China.

During fiscal 2004, we entered into agreements to acquire a 100% interest in the North Paul’s Pond Gold Property in Newfoundland and the DJ Gold Property in Shaanxi, China, which were subsequently terminated in fiscal 2006 and fiscal 2005, respectively. Related property costs were written off.

The Company’s objective is to work aggressively on the exploration and development of its mineral properties in the Province of Newfoundland and Labrador, Canada and to aggressively seek other opportunities.

Material Effects of Government Regulations

Our current and anticipated future operations, including further exploration activities, require permits from various Canadian Federal and Provincial governmental authorities. Such operations are subject to various laws governing land use, the protection of the environment, production, exports, taxes, labor standards, occupational health, waste disposal, toxic substances, well safety and other matters. Unfavorable amendments to current laws, regulations and permits governing operations and activities of resource exploration companies, or more stringent implementation thereof, could have a materially adverse impact on us and cause increases in capital expenditures which could result in our ceasing operations. We have had no material costs related to compliance and/or permits in recent years, and anticipate no material costs in the next year.

Seasonality

We can only carry out exploration when weather is favourable. Typically, we cannot carry out any work during the months of November and December for winter freeze-up and March and April for spring break-up on our Canadian properties.

Dependency upon Patents/Licenses/Contracts/Processes

Not applicable

Sources/Availability of Raw Materials

Not applicable

4.C. Organization Structure

We have no subsidiaries.

4.D. Property, Plants and Equipment

Cautionary Note to U.S. Investors concerning estimates of Inferred Resources

This section uses the term “inferred resources.” We advise U.S. investors that while this term is recognized and required by Canadian regulations, the U.S. Securities and Exchange Commission does not recognize it. “Inferred resources” have a great amount of uncertainty as to their existence, and great uncertainty as to their economic and legal feasibility. It cannot be assumed that all or any part of an Inferred Mineral Resource will ever be upgraded to a higher category. Under Canadian rules, estimates of Inferred Mineral Resources may not form the basis of feasibility or prefeasibility studies, except in rare cases. U.S. investors are cautioned not to assume that part or all of an inferred resource exists, or is economically or legally minable.

Our properties are in the exploration stage and a substantial amount of capital will have to be spent on each property before we will know if they contain commercially viable mineral deposits. Our material properties are located in the Province of Newfoundland and Labrador, Canada. Our properties are without known reserves and the work being done by us is exploratory in nature.

Our executive offices are located in rented premises of approximately 2,858 square feet at Suite 1240, 1140 West Pender Street, Vancouver, British Columbia Canada. We have occupied these facilities since 2006 and our current monthly rent is approximately $7,575. We also have a field office at 39 Sagona Avenue, Mount Pearl, Newfoundland, Canada where our current monthly rent is approximately $3,574.

Newfoundland

Golden Promise Property and Agreements

Paragon Minerals acquired an option to earn a 100% interest in the Golden Promise property subject to an underlying option agreement with William Mercer and Stephen Courtney (the “Vendors”). A total of 192 claims (4,800 hectares) comprise the option arrangement with William Mercer with payments totaling $230,000 ($155,000 paid) and 100,000 Paragon Minerals common shares, all of which have been issued. The option arrangement with Mr. Courtney involves 6 claims (150 hectares) with payments totaling $35,000. Both vendors are entitled to a 2% NSR subject to a $1 million buyback of 50% of the NSR at anytime. Paragon Minerals also staked claims in the immediate vicinity of the vendors claims to now hold a total of 1,033 claims as outlined in the Summary of Licences Under Option below.

On May 2, 2006, the Company entered into an option agreement with Paragon Minerals to earn a 60% interest in the Golden Promise Project.

The option agreement calls for:

Issuing common shares:

	Number of
	shares
Within 5 days of the execution date of the
agreement	20,000	Issued by the Company
On or before May 1, 2007	20,000	Issued by the Company
On or before May 1, 2008	20,000
On or before May 1, 2009	20,000
	80,000

ii)

Incurring a total of $4,000,000 in exploration expenditures:

		Amount
On or before May 1, 2007 (as a firm and	$	750,000	⁽¹⁾
binding commitment)
On or before May 1, 2008		900,000
On or before May 1, 2009		1,100,000
On or before May 1, 2010		1,250,000
	$	4,000,000

⁽¹⁾	As at April 30, 2007, the Company incurred $745,004 in exploration expenditures, paid $85,000 in cash, and issued 20,000 common shares at a value of $25,400 for acquisition costs.

iii)

Make cash payments on behalf of Paragon Minerals for Paragon Minerals’ obligations with respect to the Golden Promise Project and other claims as follows:

		Amount
On or before June 1, 2006	$	75,000	Paid by Paragon Minerals
On or before June 14, 2006		10,000	Paid by the Company
On or before June 14, 2007		15,000
	$	100,000

During the year ended April 30, 2007, the Company advanced $587,000 to Paragon Minerals for Golden Promise exploration costs and at April 30, 2007, Paragon Minerals had spent $742,803. As a result the Company owes Paragon Minerals $155,803.

A 14 hole, 3,073 meter program was completed in the 2006/2007 winter exploration program. This drilling was successful in extending the main Jaclyn vein system by more than 50% to a current defined strike length of 750 metres and to a depth of 225 metres, and the zone remains open. Visible gold was noted in 10 of the 14 holes completed in this phase of drilling, which included some of the highest grades reported to date.

The work completed to date has unveiled a significant gold bearing system at the main Jaclyn Zone. At Jaclyn North, which also remains open in all directions, 4 of 6 holes completed to date intersected visible gold bearing quartz veins. Given its potentially high grade nature and its close proximity to the main Jaclyn Zone, the Jaclyn North system could prove to be an extremely important component of the Golden Promise project and will be addressed with additional drilling in the future.

In advance of the planned spin out of its Newfoundland gold and base metal assets, the Company plans to commission a NI 43-101 report covering the Golden Promise (gold) and Victoria Lake (zinc/copper/silver/gold) projects.

Expenditure Schedule

Year	Work Expenditures	Shares Issued to Rubicon Minerals

Within 5 days of execution Date	--	20,000

on or before 1st anniversary	$ 750,000	20,000

on or before 2nd anniversary	$ 900,000	20,000

on or before 3rd anniversary	$ 1,100,000	20,000

on or before 4th anniversary	$ 1,250,000	Nil

In lieu of making any or all share payments as outlined above, Crosshair may elect to make cash payments of $30,000 (on the basis of $1.50 cash in lieu of each share). As of April 30, 2007, we incurred $745,004 in exploration expenditures, paid $85,000 in cash and issued 20,000 Common Shares at a value of $25,400 for acquisition costs.

The six blocks of licenses cover 25,825 hectares in 1,033 map-staked claims. Each claim is 500 by 500 metres, which is bounded by one corner of the UTM grid square and is one quarter of the square. The claims are grouped into licenses, which are the units of ownership and assessment work requirements. The details of the licenses covered by the option agreement are described as follows:

Summary of Licenses under Option

			Sec.
Licence	Claims	NTS AREA	Deposit	Renewal Date	Report Due	Expenditures Required
8904M	6	12A/16	$0.00	July 9, 2007	September 7, 2006	$600.93 by 2006/07/09
11028M	256	12A/16	$0.00	June 21, 2007	August 20, 2007	$85,929.15 by 2008/06/21
11029M	256	12A/16	$0.00	June 21, 2007	August 20, 2007	$80,698.88 by 2008/06/21
11033M	256	2D/13, 12A/16	$0.00	June 21, 2007	August 20, 2007	$99,928.62 by 2008/06/21
11034M	217	12A/16	$0.00	June 21, 2007	August 20, 2007	$94,636.18 by 2009/06/21
11057M	42	12A/16	$0.00	October 28, 2009	December 27, 2006	$5,398.54 by 2006/10/28
Total:	1,033

Paragon Minerals will be the operator (manager) overseeing the execution of the exploration programs in the first and second years for cost plus 8% fee. Subsequent to the second year, we will consider renewing Paragon Minerals as operator or elect to carry out the exploration programs on Golden Promise using in-house personnel.

Property Location

The Golden Promise Property consists of six blocks of licenses located east, and northeast of Red Indian Lake in west central Newfoundland specifically within National Topographic Series (NTS) Map Sheets 12A/16 and 2D/13, part of the Grand Falls – Buchans Electoral District. The claims are crosscut by an all season Highway (Route 370) connecting the towns of Buchans in the southwest to Badger at the Trans Canada Highway in the northeast end of the property.

Accessibility

The properties are accessible from Badger on the Trans Canada Highway via Route 370 to Buchans Junction about 43 km to the southwest. The Buchans Highway (Route 370) is the principal access road to the various blocks in the west and southwest portions of the property where most of the exploration activity has been focused. Access to the eastern and southern portions of the property is gained via logging roads trending south and west of the town of Grand Falls-Windsor, a major industrial hub for central Newfoundland. The Exploits River, the largest river system on the Island of Newfoundland, crosses the north-western part of the property. Secondary access to most of the property is provided by logging roads and snowmobile and ATV trails leading from Route 370 as well as the logging roads south and southwest of Grand Falls-Windsor.

History and Previous Work

The exploration history of the vast majority of the property dates back only as far as 2002, when a prospector working in an area burned by a major forest fire in 1999 located gold-bearing quartz boulders immediately north of Route 370 approximately 10 kilometers southwest of the town of Badger. Exploration in the region prior to 2002 traditionally focused on the massive sulphide districts located south and west of the current property boundaries. The mining town of Buchans, located about 30 kilometers west - southwest of the property, produced ores carrying extremely rich grades of zinc (14.5%), copper (1.4%), lead (7.6%), gold (1.3 grams per tonne) and silver (126 grams per tonne) for 56 years prior to closing in 1984. The massive sulphide districts of Newfoundland are renowned for their high grade and polymetallic nature.

The property was mapped by both the Provincial and Federal Geological Surveys whose efforts included regional scale geological surveys and geochemical surveys including glacial till and lake sediment sampling.

In the spring of 2002, a local prospector, William Mercer, discovered several large boulders of gold bearing float of which a composite sample from 10 boulders returned 30 grams per tonne gold. The property was subsequently optioned by Mr. Mercer to Paragon Minerals in July of 2002.

Geological Setting

The property lies within the Dunnage Zone, a major tectonic and stratigraphic succession of Cambrian to Ordovician aged volcanic and sedimentary rocks occupying much of central Newfoundland. The Dunnage Zone rocks record the opening and closing of a proto-Atlantic Ocean known as Iapetus. The Dunnage Zone can be subdivided into two subzones, the Notre Dame and the Exploits, which are separated by a major fault system known as the Red Indian Line. The bulk of the Golden Promise property is inferred to be underlain by rocks of the Exploits Subzone, which includes the Badger and Victoria Lake Groups.

Regional Geology and Mineralization

The property is largely underlain by sedimentary rocks of the Badger Group, which conformably overlie Caradocian black shale, which in turn overlie Ordovician volcanic and sedimentary rocks of the Victoria Lake Supergroup. The volcanic sequences of the Victoria Lake Supergroup are among the most prolific hosts to massive sulphide copper/lead/zinc deposits in Canada.

Property Geology and Mineralization

The property is largely underlain by sedimentary rocks of the Badger Group, consisting mainly of arkose, greywacke and shale. The Badger Group rocks sit on top of the Victoria Lake sequences of volcaniclastic and fine grained sedimentary rocks. A unit of black shale of Caradocian age separates the Badger Group from the Victoria Lake Group and is a regional stratigraphic marker. All rock units have been folded into a series of tight, isoclinal, upright, northeast plunging folds. The dominant structural trend is northeasterly as demonstrated by northeasterly faults and mafic dykes, which occupy the faults at several locations.

The mineralization at Golden Promise consists of a series of sub-parallel gold-bearing quartz veins ranging up to 4 meters in true thickness. The veins are milky white, inclusion rich and locally bladed. Gold is hosted by the veins typically occurring within narrow intervals (20-30 cms) close to vein margins. Fine grained arsenopyrite is the most common accessory mineral with lesser amounts of pyrite, galena, spahalerite and chalcopyrite (< 1%).

At least 5 known zones of gold mineralization are known to occur at Golden Promise and include the Jaclyn, Jaclyn South, Jaclyn North, Christopher and Shawn’s Shot occurrences, of which the most important are the Jaclyn, Jaclyn South and Jaclyn North Zones. The most significant mineralization occurs at the Jaclyn Zone, which has been defined by diamond drilling over a strike length of 750 meters and to a vertical depth of 270 meters. A total of 63 holes have been drilled in to the Jaclyn Zone (9,000 meters) including 11 as part of the ongoing Phase 3 program which began at the end of June 2007. Significant intersections include GP02-01 which returned 16.57 grams per tonne gold over 1.64 meters, GP02-05 which returned 11.41 grams per tonne gold over 1.80 meters, GP02-09 which returned 7.05 grams per tonne gold over 2.22 meters, GP07-83 which returned 6.51 grams per tonne gold over 1.40 meters, and GP07-90 which returned 10-14 grams per tonne gold over 1.40 meters. Drilling completed in August of 2006 intersected a new hangingwall zone of mineralization which returned 93.71 grams per tonne gold over 1.40 meters.

The Jaclyn North occurrence, located 250 meters north of the Jaclyn Zone, has been tested by 10 drill holes and has been defined over a 250 meter strike length. The occurrence has returned values up to 5.24 grams per tonne gold over 1.70 meters.

The Jaclyn South occurrence, located 300 meters southeast of the Jaclyn Zone, consists of at least 3 vein zones up to 3.4 meters thick and has been tested by four drill holes. The best result to date is 0.30 meters grading 44.6 grams per tonne gold.

Exploration and Development

In July of 2002, the property was optioned by local prospectors to Paragon Minerals who completed a Phase 1 drilling program to follow up on the discovery of high grade gold-bearing float. The 21 hole program (1,045 meters) tested the Jaclyn Zone along a 225 meter strike length and to a vertical depth of 50 meters. Subsequent drilling in late 2003 extended the Jaclyn Zone along strike and to depth, and also tested the newly discovered Jaclyn North and Jaclyn South Zones.

We optioned the Golden Promise property from Paragon Minerals on May 1, 2006 and embarked on a Phase 2 drilling program in June. The Phase 2 program, completed in February 2007, included 5,488 meters of drilling in 29 holes on the Jaclyn, Jaclyn North and Jaclyn South Zones. In late June 2007, a 3,750 meter Phase 3 drilling program was initiated on the property, of which 2,614 meters have been completed in 15 holes. The remaining eight planned drill holes of the Phase 3 program are to be completed before the end of 2007.

The first year of the agreement between Crosshair and Paragon Minerals will see Paragon Minerals manage the program and collect an 8% management fee. Paragon Minerals has carried all exploration programs since 2002 and is the best candidate for managing the program. Successive drilling programs to date have been successful in extending the known limits of the Jaclyn Zone to 750 meters along strike and to vertical depths of 270 meters.

To date over $2.5 million in exploration work has been carried out on the property since 2002. The work includes more than 80 drill holes of which 63 have been drilled on the Jaclyn Zone, 4 holes at Jaclyn South and, 10 holes at Jaclyn North, 2 holes at the Christopher Zone and 2 holes at the Shawn’s Shot occurrence. The remaining drill holes tested various geochemical and geophysical targets over the remainder of the property. The drilling followed extensive soil sampling, prospecting and trenching, which included 21surface trenches, 5,624 soil samples and 2,334 rock samples as well as geological and structural mapping surveys. An 8,250 kilometer high resolution airborne magnetic and electromagnetic survey was flown in late 2003 to assist in the geological mapping and structural interpretation of the property. The airborne survey was extremely successful in outlining the trace of the Caradocian shale, a key marker unit closely associated with the mineralization at the Jaclyn Zone in particular.

South Golden Promise Property

Paragon Minerals acquired an option to earn a 100% interest in the South Golden Promise Property pursuant to an underlying option agreement, dated January 8, 2003, with Al Keats, Calvin Keats and Kevin Keats (the "Vendors"). The Vendors are entitled to a 2.5% Net Smelter Return. Paragon Minerals can repurchase a 1.5% Net Smelter Return for $1,500,000 and has a right of first refusal with respect to the remaining 1.0% . As of September 2005, Paragon Minerals completed its obligations under its option agreement with the Vendors and now holds a 100% interest in the South Golden Promise Property subject to the 2.5% Net Smelter Return.

On February 14, 2003, we entered into an option agreement with Paragon Minerals whereby we acquired an option to purchase and earn a 60% interest in the South Golden Promise Property. In order to earn the 60% interest, we agreed to pay $1,750,000 in exploration expenditures on the property and issue 400,000 common shares to Paragon Minerals, over a four year period. The schedule of work and share issuance is as follows:

Expenditure Schedule

Year	Work Expenditures	Shares Issued to Rubicon Minerals
on Approval Date	--	100,000
on or before 1^stanniversary	$ 250,000	100,000
on or before 2^ndanniversary	$ 300,000	100,000
on or before 3^rdanniversary	$ 500,000	100,000
on or before 4^thanniversary	$ 700,000	--

As of April 30, 2007, we incurred $1,647,312 in exploration expenditures, issued 400,000 Common Shares at a value of $328,000 and paid cash of $27,500 on this property.

The two blocks of licenses cover 17,800 hectares in 712 map-staked claims. Each claim is 500 by 500 metres, which is bounded by one corner of the UTM grid square and is one quarter of the square. The claims are grouped into licenses, which are the units of ownership and assessment work requirements. The details of the licenses covered by the option agreement are described as follows:

Summary of Licenses under Option

			Sec.
Licence	Claims	NTS AREA	Deposit	Renewal Date	Report Due	Expenditures Required
SGP
		12A/09,10,
12460M	70	15,16	$0.00	November 22, 2009	January 21, 2008	$11,224.08 by 2007/11/22
12462M	256	12A/16	$0.00	August 19, 2012	October 18, 2008	$4,605.26 by 2009/08/19
13591M	23	12A/16	$0.00	November 22, 2009	January 21, 2008	$6,538.63 by 2007/11/22
13766M	34	12A/15, 16	$1,700.00	August 16, 2012	October 15, 2008	$6,800.00 by 2008/08/16
11058M	20	12A/16	$0.00	October 28, 2009	December 27, 2007	$6,921.20 by 2008/10/28
11059M	4	12A/16	$0.00	October 28, 2009	December 27, 2007	$568.64 by 2010/10/28
Victoria
08883M	166	12A/06	$0.00	July 2, 2012	September 1, 2008	$83,525.58 by 2009/07/02
12380M	139	12A/06	$0.00	July 5, 2009	September 3, 2008	$77,701.49 by 2013/07/05
Total:	712

Paragon Minerals was the contractor for the execution of the exploration programs in the first year for cost plus 8% fee. Subsequent to the first year, we have operated and carry out the exploration programs on the South Golden Promise property using in-house personnel.

We are responsible for paying for and renewing these licenses. The fee for license renewals is $25 per claim every five years and failure to pay the fee will result in the loss of the claims.

Property Location

The South Golden Promise Property consists of two blocks of Licences located east and southwest of Red Indian Lake in west central Newfoundland, in the Grand Falls – Buchans Electoral District. The property is named for the extension of similar geology of the Golden Promise property which is contiguous and immediately northeast of the South Golden Promise claims. The South Golden Promise Property also includes the Victoria Lake claims which are targeting massive sulphide deposits as opposed to the gold targets of Golden Promise and South Golden Promise

Accessibility

The properties are accessible from Badger on the Trans Canada Highway via Route 370 to Buchans Junction about 43 kilometers to the southwest of Badger, and from Grand Falls-Windsor, immediately east of the property. The Millertown – Lake Ambrose logging haulage road west southwest of Buchans Junction is the principal access road to the various claim blocks to the south and southwest. The Exploits River, the provinces largest river system, crosses the northern portion of the property. The Victoria Lake claim group, the southwestern most claims, are best accessed by the main logging road leading west from the Exploits Dam along the south shore of Red Indian Lake. Numerous older logging roads, generally in poor shape, crosscut the property and afford locally limited access.

History

The northeastern portion of the property has received the least amount of previous exploration. In fact, prior to the discovery of gold-bearing boulders at Golden Promise in 2002, most of the northern half of the property had received no previous exploration.

The bulk of exploration activity in the region focused on the highly prospective volcanic rocks to the southwest which are known to host numerous copper and zinc prospects in the region. The sedimentary sequences that host the Jaclyn gold mineralization were completely ignored by previous explorers. The volcanic sequences, most common on the south side of the Exploits River and occurring in the south central portion of the South Golden Promise property, received moderate amounts of exploration in the search for base metals (copper, lead and zinc). Noranda was most active and carried out ground surveys including, line cutting, geological mapping, soil sampling and geophysics.

Several widely spaced drill holes did not intersect any mineralization. Immediately east of the property Aur Resources (subsequently taken over by Teck/Cominco) commenced commercial production in January 2007 at the Duck Pond deposit and will produce concentrate containing copper, zinc, lead, gold and silver over the projected 10 year life of the mine.

The Victoria Lake claims have received the most intensive exploration of all of the South Golden Promise property. The claims are considered highly prospective to host significant quantities of massive sulphides rich in copper, lead, zinc, gold and silver. Noranda carried out numerous exploration programs over the past 25 years including diamond drilling. Favourably altered volcanic rocks were encountered in several localities and suggest that massive sulphide bodies could exist on the claims. Work by Paragon Minerals in 2002 located potentially significant gold mineralization in the extreme southwestern portion of the claim group. Results include sulphide-bearing quartz veins that have returned assays of 2.5 and 3.6 grams per tonne gold.

Property Geology

The South Golden Promise property, in particular the northern and central portions, is underlain mainly by sedimentary and volcanic rocks of the Ordovician Victoria Lake Group which are in turn overlain by the Badger Group sedimentary rocks. The Badger Group rocks only occur in the northern portion of the property with the vast majority of the property area underlain by rocks of the Victoria Lake Group. The Victoria Lake Group is dominated in the upper sections by fine grained sedimentary sequences, while the lower portions of the Group are dominated by mafic and felsic volcanic rocks with minor interbedded sedimentary rocks. The Victoria Lake Group and Badger Group rocks are separated by a regionally important marker horizon of Caradocian shale.

The prominent structures on the property are a major syncline - anticline pair traced by folds in the Cardocian shale. The folds are tight and upright with a gentle plunge to the northeast. Penetrative foliation is common and sub parallel to bedding. Glacial striae showing ice movement to the northeast and south-southeast are observed locally.

The Victoria Lake claims are underlain mainly by volcanic and sedimentary rocks of the Victoria Lake Group. The felsic volcanic rocks in this area are considered highly prospective for hosting significant massive sulphide deposits and several areas of favourably altered and locally mineralized volcanic rocks are known to occur. These areas will be the primary target of exploration efforts on that portion of the property.

Exploration and Development

Since acquiring the properties, we have completed several phases of exploration including prospecting, mapping, till and rock sampling as well as excavator trenching on targets defined by the other works. The Victoria Lake claims also had ground gravity surveying completed to help identify potential massive sulphide targets. Diamond drilling has been carried out on the gold targets at South Golden Promise and the massive sulphide targets at Victoria Lake.

At South Golden Promise, the work to date has outlined a significant gold-bearing quartz vein system that has been exposed on surface for 170 meters and tested to about 50 meters in diamond drilling. A total of 16 holes were completed at South Golden Promise with two holes returning visible gold bearing quartz veining returning a high of 19.5 grams per tonne gold over 1.15 meters. Further work including diamond drilling and trenching of soil geochemical anomalies is proposed for the South Golden Promise gold target.

At Victoria Lake, an 11 hole (2,197 meters) diamond drilling program was completed in 2006. The program tested several coincidental geological, rock and soil geochemical anomalies as well as geophysical (gravity) anomalies identified by Crosshair. Favorably altered, sulphide-bearing felsic volcanic units were encountered in several of the holes. The drilling program was managed by Paragon Minerals personnel who have extensive experience in the region and who received 8% of the program costs as a management fee. Further work including diamond drilling has been recommended.

Labrador—Central Mineral Belt

The Moran Lake Property

On October 14, 2004, the Company entered into an agreement with a private individual for an option to acquire a 90% interest (subject to a 2% NSR and a 10% carried interest to the vendor) in the Moran Lake Property in Central Labrador. On March 1, 2005 the Company acquired another 381 claims north of the Moran Lake Property, known as Moran Heights.

We subsequently carried out a detailed digital compilation of all the historic work that has been carried out on the property. The TSX Venture Exchange approved this transaction on November 10, 2004.

The amended and restated agreement calls for:

Making cash payments:

		Amount
Upon execution of the agreement (original)	$	25,000	(Paid October 2004)
Within 5 business days of the approval date (original agreement)		50,000	(Paid November 2004)
Upon signing of the amended and restated agreement		25,000	(Paid March 2005)
On or before November 10, 2005		100,000	(Paid November 2005)
On or before November 10, 2006		100,000	(Paid November 2006)
On or before November 10, 2007		125,000
On or before November 10, 2008		150,000
	$	575,000

ii)

Issuing common shares:

	Number of shares
Upon execution of the agreement (original)	250,000	(Issued October 2004)
Upon acceptance by the TSX Venture Exchange (amended agreement)	100,000	(Issued March 2005)
Upon the approval date of the original agreement	250,000	(Issued December 2004)
Second year share payment	250,000	(Issued October 2005)
Third year share payment	250,000	(Issued November 2006)
Fourth year share payment	250,000
Fifth year share payment	250,000
	1,600,000

iii)

Incurring a total of $3,000,000 in exploration expenditures:

		Amount
On or before November 10, 2005	$	100,000	(Requirement met)
On or before November 10, 2006		300,000	(Requirement met)
On or before November 10, 2007		500,000	(Requirement met)
On or before November 10, 2008		800,000	(Requirement met)
On or before November 10, 2009		1,300,000	(Requirement met)
	$	3,000,000

The agreement requires completion of a bankable feasibility study for the commencement of commercial production on the property within 24 months of completion of all aforementioned obligations.

We can earn a 90% interest in the Moran Lake Property by completing the following obligations:

Expenditures	Shares Issued to Lewis Murphy	Cash Payments to Lewis Murphy
$100,000 by November 10, 2005	250,000 released from trust to Lewis Murphy on November 10, 2004	$25,000 on signing of the original Moran Lake agreement
$200,000 by November 10, 2006	250,000 shares issued to Lewis Murphy on November 10, 2004	$50,000 within 5 days of November 10, 2004, the approval date of the original Moran Lake agreement
$500,000 by November 10, 2007	100,000 shares on the approval dated of the amended and restated Moran Lake agreement dated March 1, 2005	$25,000 upon the signing of the amended and restated Moran Lake agreement dated March 1, 2005
$800,000 by November 10, 2008	250,000 shares; second year share payment on or before November 10, 2005	$100,000 on or before November 10, 2005
$1,300,000 by November 10, 2009	250,000 shares; third year share payment on or before November 10, 2006	$100,000 on or before November 10, 2006
	250,000 shares; fourth year share payment on or before November 10, 2007	$125,000 on or before November 10, 2007
	250,000 shares; fifth year share payment on or before November 10, 2008	$150,000 on or before November 10, 2008
		$200,000 per year on or before November 10 of every subsequent year until the Moran Lake Property is put into commercial production

As at April 30, 2007, the Company incurred $9,861,712 (net of $266,300 credits received) in exploration expenditures, paid $300,000 in cash, and issued 1,100,000 common shares at a value of $960,000 for acquisition costs.

The Company completed over 9,400 metres of drilling in the 2007 winter exploration program on the Central Mineral Belt project. The drilling focused on the Upper and Lower C Zones and targets along strike, and the results continue to substantiate the potential for a large uranium deposit(s) within a 4.5 kilometer-long trend. This drilling, together with over 20,000 metres of drilling in 2006, will be used to greatly expand the existing NI 43-101 resource outlined by Shell Canada drilling in the late 1970s. This updated resource estimate will be completed in July 2007.

A 40,000 meter drill program utilizing three drill rigs is planned for the remainder of the year on the entire Central Mineral Belt Project. The program is designed to increase the uranium resource contained in the Upper C Zone, delineate a uranium resource at the Lower C and B Zones, continue defining known uranium zones at Area 1, Moran Heights and Croteau Lake, and test new “Blue Sky” uranium targets. Concurrently, an extensive mapping, rock sampling, geochemical and geophysical program will be carried out on the under-explored southern region of the 750 square kilometer project.

On December 2, 2005, we entered into an agreement to acquire 56 claims from Triassic Properties Limited, a private St. John’s, Newfoundland based company. The claims cover historic uranium occurrences and are strategically located within the Moran Lake property holdings. In order for us to earn a 100% interest in the Otter and Portage Lake claims, subject to a 1.5% NSR to the vendor, we must, over the 3 year term, carry out $600,000 in eligible exploration expenses, issue 225,000 common shares and pay an aggregate of $140,000. Through April 30, 2007, we have spent $208,765 in exploration costs, issued 125,000 Common Shares and made cash payments of $55,000

Property Description and Location

The Moran Lake Property is located in the Central Mineral Belt of Labrador, about 140 km north of the town of Happy Valley-Goose Bay and 85 km southwest of the coastal community of Postville on Kaipokok Bay. In a direct line to the northeast, the property is about 75 km from tidewater. The undeveloped Michelin uranium deposit is 60 km east-northeast of the Moran Lake Property. The property area is within the Naskaupi Electoral District of Labrador.

Summary of Licences under Option

			Sec.
Licence	Claims	NTS AREA	Deposit	Renewal Date	Report Due	Expenditures Required
9781M	28	13K/10	$0.00	December 1, 2008	January 30, 2008	$25,200.00 by 2016/12/01
9783M	3	13K/06	$0.00	December 1, 2008	January 30, 2008	$1,759.28 by 2015/12/01
10367M	8	13K/03	$0.00	November 15, 2009	January 15, 2008	$1,220.96 by 2012/11/15
10368M	48	13K/06	$0.00	November 15, 2009	January 15, 2008	$43,200.00 by 2016/11/15
10715M	256	13K/06, 07	$0.00	April 1, 2010	May 31, 2008	$91,696.10 by 2010/04/01
10716M	256	13K/06	$0.00	April 1, 2010	May 31, 2008	$73,303.49 by 2010/04/01
10717M	256	13K/06	$0.00	April 1, 2010	May 31, 2008	$70,765.01 by 2010/04/01
10718M	256	13K/06	$0.00	April 1, 2010	May 31, 2008	$95,002.35 by 2010/04/01
10719M	256	13K/06, 07	$0.00	April 1, 2010	May 31, 2008	$93,087.60 by 2010/04/01
10720M	256	13K/07	$0.00	April 1, 2010	May 31, 2008	$94,249.10 by 2010/04/01
10722M	201	13K/02, 03, 06	$0.00	April 1, 2010	May 31, 2008	$70,230.06 by 2010/04/01
10723M	229	13K/07	$0.00	April 1, 2010	May 31, 2008	$79,185.50 by 2010/04/01
11395M	36	13K/06	$1,800.00	November 16, 2010	January 15, 2008	$17,129.24 by 2011/11/16
11770M	140	13K/06	$7,000.00	February 28, 2011	April 30, 2008	$48,685.74 by 2011/02/28
11833M	16	13K/07	$0.00	July 22, 2012	September 20, 2008	$14,400.00 by 2017/07/22
11834M	48	13K/06, 07	$0.00	July 22, 2012	September 20, 2008	$43,200.00 by 2017/07/22
11835M	27	13K/06, 07	$0.00	July 22, 2012	September 20, 2008	$24,300.00 by 2017/07/22
12616M	79	13K/06,07, 10,11	$0.00	April 1, 2010	May 31, 2008	$13,444.14 by 2011/04/01
12617M	89	13K/10	$0.00	February 21, 2010	April 23, 2008	$18,907.05 by 2010/02/21
12618M	252	13K/07, 10	$0.00	January 31, 2010	April 2, 2008	$10,780.33 by 2012/01/31
13427M	105	13K/03	$5,250.00	May 3, 2012	July 2, 2008	$21,000.00 by 2008/05/03
13634M	5	13K/03	$250.00	July 5, 2012	September 3, 2008	$1,000.00 by 2008/05/07
13635M	10	13K/06	$500.00	July 5, 2012	September 3, 2008	$2,000.00 by 2008/05/07
12353M	66	13K/03	$3,300.00	July 24, 2011	September 22, 2008	$19,380.14 by 2011/07/24
12376M	39	13K/02, 03	$1,950.00	July 31, 2011	September 29, 2008	$12,565.46 by 2011/07/31
13332M	11	13K/03	$550.00	April 12, 2012	June 11, 2008	$2,200.00 by 2008/04/12
12352M	23	13L/02	$1,150.00	July 24, 2011	September 22, 2008	$6,939.29 by 2011/07/24

Total:	2,999

Accessibility

Helicopter, and to a lesser degree float plane service out of Goose Bay, is the most efficient means of access to the property. Local infrastructure is confined to the limited facilities of the community of Postville, which does enjoy commercial airline service from Goose Bay and commercial ferry service from St John’s, Newfoundland. Coastal boats are available to convey goods and passengers from Happy Valley to Postville. Most necessary goods and services, including charter aircraft, can be obtained in Goose Bay, which has excellent commercial airline connections to St John’s, Halifax and Montreal.

This part of Labrador has a sub-Arctic climate with short, cool summers and long, cold winters. Snow cover lasts for six to eight months. Freeze-up begins in late-October and the lakes become ice free in mid-June. Temperature ranges can be extreme from -30°C in winter to in excess of 28°C in the summer. Lengthy periods of fog and/or rain can be experienced during the summer exploration season.

The topography of the Moran Lake area consists of rolling highlands with maximum relief approaching 300m. The hilltops can be partly barren while the slopes and valleys are covered in vegetation, mostly scrubby black spruce and some deciduous trees with thick intervening growth of alders. Almost everywhere there is a thick ground cover of moss. The valleys are steep sided at many locations and are often host to boggy ground with small ponds or lakes. Moran Lake, one of the largest lakes on the property, occupies a prominent valley which trends east-northeast.

History

Uranium was first discovered near Moran Lake by British Newfoundland Exploration Limited, which conducted prospecting, geological mapping and radiometric surveying in the area from 1956 to 1958. In 1964, Mokta Co. Ltd. (Mokta) acquired a development license for the Moran Lake area and subsequently discovered uranium mineralization at Lady Lake, the site of the present C zone. In following years, Mokta completed a considerable amount of prospecting, trenching and packsack drilling in the Moran Lake A, B and C zones. In 1969 however, Mokta allowed the development license to expire at which time the license was granted to Brinex, which did no further work on the property.

In 1976, the license was granted to Commodore Mining Company Limited (Commodore) which in turn optioned the property to Shell Canada Resources Limited (Shell). During September of 1976, Shell performed geological, magnetometer and Track Etch surveys over the B zone near Henry Lake and did preliminary geological mapping on the C zone. This led to a 15 hole, 864 m drill program to test the B zone uranium mineralization during the winter of 1977.

In the summer of 1977, a full exploration program was carried out on the C zone including detailed geological mapping, systematic trench sampling, a scintillometer survey and a small drill program totalling eight holes and 497 metres. Uranium mineralization was discovered in a fault zone over which VLF-EM, magnetometer and Track Etch surveys were performed during September. In the winter of 1978, Shell completed a 17 hole, 1,542 m drill program to test the uraniferous fault zone and subsequently found high grade uranium mineralization. The following summer’s exploration program consisted of VLF- EM, magnetometer and altimeter surveys over the entire C zone, with a 15 hole, 1,581 m drill program to test the uraniferous zones. Low grade uranium mineralization was located in altered sandstones above the Aphebian-Helikian unconformity near Lady Lake. This led to a 1979 winter dril1 program of 17 drill holes totalling 1,193 m to explore the unconformity and the later named Lower C zone.

In the summer of 1979, Shell undertook a review of its Moran Lake project. Drill core from the Upper C zone (C-1 to C-35) was re-logged by one person and multiple samples were taken for thin section study and 30 element spectrographic analysis. This work led to the appreciation that the rocks were extensively altered, that the identification of primary lithologies was in many cases dubious, that the uranium mineralization was associated with alteration and that there was a definable geometry to the alteration package. The property was

considered to have good uranium potential and an 8 hole, 1,400 m drill program was proposed but never carried out as Shell abandoned its interest in the area.

Lewis Murphy acquired the Moran Lake claims in 2003 and optioned the ground to Crosshair in October of 2004. In 2003, an airborne gravity survey of the area located an interpreted 4 milligal to 8 milligal gravity anomaly, elliptical in shape, about 4 km long and centered between the Moran B and C zones. Considering the spatial association of uranium with brecciated, highly silicified, carbonatized and hematized rocks, plus locally significant concentrations of copper, silver and gold mineralization, Crosshair invoked the analogy with Iron Oxide Copper Gold (IOCG) deposit types, as at Olympic Dam in Australia.

Since acquiring the Moran Lake property in October, 2004, we have embarked on an aggressive program including airborne radiometric and magnetic surveys, compilation of previous work including sampling archived drill core from the 1970’s Shell Canada Resources drilling, and commencement of diamond drilling in January of 2006. A more detailed description of the exploration program is included below under “—Exploration.”

Property Geology

The Moran Lake Property was staked in a configuration to cover as much mineralized Paleoproterozoic stratigraphy as was available. This encompasses mostly rocks of the Moran Lake Group and the overlying Heggart Lake, Brown Lake and Sylvia Lake Formations of the Bruce River Group, both groups containing known occurrences of uranium, Cu, Pb, Zn, Ag, Fl and iron (as pyrite and hematite).

The Moran Lake Group (MLG) unconformably overlies Archean gneisses and granites of the Nain Province. The basal unit, the Warren creek Formation was deposited in a low energy, shallow shoreline or shelf environment and consists mainly of black graphitic, grey and green shale and siltstone containing local interbeds of dolostone, chert and black conglomerate with siltstone and shale clasts. The Warren Creek Formation ranges from perhaps 1,200m up to 3,000m in thickness and is overlain conformably by 100m to 300m thickness of the Joe Pond Formation, a sequence of light- to dark-green, fine grained, massive and pillowed basalt and mafic tuff with occasional interbeds of variably colored chert or grey dolostone. Rocks of the Moran Lake Group occupy a northeasterly trending belt which underlies the northern projection of the Moran Lake Property.

The Bruce River Group consists of a basal, polymictic conglomerate and sandstone of the Heggart Lake Formation overlain by polymictic conglomerate and tuffaceous sandstone of the Brown Lake Formation. The uppermost and thickest unit of the Group is the Sylvia Lake Formation, a bimodal, potassic calc-alkaline assemblage of predominantly subaerial volcanic rocks which are coeval with the plutons of the Trans Labrador Batholith. Northerly directed compression during the Grenville orogenic event folded the Bruce River Group into a northeast-trending, open, upright syncline.

Exploration

We acquired the property in October of 2004 and immediately launched a comprehensive review and compilation of all previous exploration carried out on the property. The results of the review confirmed that the property had considerable potential to host multiple uranium and uranium rich iron oxide copper gold deposits (IOCG).

Exploration work on the property by Crosshair has included line cutting, ground geophysical surveys, lake sediment sampling and till geochemical surveys, prospecting, limited hand trenching and geological mapping. The ground geophysical surveys include gravity, induced potential (IP), and horizontal loop EM (Max-Min) surveys. An airborne radiometric and magnetic survey totaling 7,312 line kilometers covering the entire property was carried out by Fugro Airborne Surveys in 2005. A supplemental airborne survey totaling 675 kilometers covering several claims acquired subsequent to the 2005 survey was carried out by Fugro in 2006. In 2007, a helicopter supported electromagnetic and magnetic (HeliGEOTEM) survey totaling approximately 4,500 line kilometers was carried out over 2 different blocks on the property. Follow-up of targets identified from interpretation of the various data has resulted in the discovery of several new showings and target areas, some of which have been drill tested as well as others that are being advanced to the drill ready stage.

A NI43-101 report was commissioned in 2007 and included a revised resource estimate for the Upper and Lower C-Zones based on our drilling to date as well as previous drilling carried out by Shell Canada Resources Limited. The estimate included an indicated resource in the Upper C-Zone of 3.19 million pounds U₃O₈(3.75 million tonnes at 0.04%), as well as inferred resources of 4.59 million pounds U₃O₈(6.32 million tonnes at 0.03%) in the Upper and Lower C-Zones.

Drilling

We launched our first drill program in February 2006, completing approximately 2,900 meters of drilling in 19 holes at the C-Zone. Further drilling using two drill rigs and totaling over 18,600 meters was carried out during the summer of 2006, followed by an additional 9,400 meters of drilling during the winter of 2007. The drilling programs focused on defining uranium mineralization at the C-Zone, which represents the most advanced uranium target on the property, but also tested targets at the B-Zone, Area 51, Moran Heights, Madsen Lake, and Area 1.

Our 2006 drill program totaled 21,486 meters and consisted of 137 holes, of which 58 tested the Upper C Zone and 10 tested the Lower C zone. The remainder of the holes tested seven other anomalies or showings on the property. From late January 2007 to late April of 2007, we carried out further drilling at the C Zone as well as limited drilling at the Armstrong and Dominion showings and Area 1. Total drilling in the winter 2007 amounted to 9,410 meters in 34 holes. At the C Zone, our 2007 winter drill program consisted of 8,211 meters in 26 holes. Fifteen of the holes tested both the Upper and Lower C Zone, 6 holes (1,042 meters) tested the Upper C Zone only, and 5 holes (1,166 meters) tested the Lower C Zone. The program expanded the C Zone mineralization along strike and to depth. The program also included the intersection of the thickest and highest grades of uranium reported from the Lower C Zone.

Significant results from the Phase 1 and 2 programs at the C-Zone include 6.03 meters grading 0.11% U₃O₈in hole ML-09, 30.30 meters grading 0.13% U₃O₈in hole ML-20, and 28.90 meters grading 0.14% U₃O₈in hole ML-32. At the B-Zone, hole ML-BZ-01 returned 0.27% U₃O₈over 7.56 meters, including 0.96% U₃O₈over 1.26 meters. At Area 1, hole ML-A1-16 intersected 11.50 meters grading 0.11% U₃O₈. All zones of mineralization reported to date are open for extension.

A third drill rig was mobilized to the property during the summer of 2007 for the Phase 3 diamond drilling program. To date over 11,000 meters have been drilled as part of the Phase 3 program at the C-Zone, Area 1, and Croteau Lake. Preliminary assay results from the Phase 3 program have returned some of the best intercepts to date from the C-Zone, including hole ML-87 which graded 0.10% U₃O₈over 45.7meters, and hole ML-90 which graded 0.10% U₃O₈ over 36.7 meters. We plan to continue drilling in 2007 with a focus on the Upper C Zone and a property wide total of 30,000 meters of drilling in all areas tested.

To date on the Moran Lake property, we have completed 136 drill holes at the C-Zone, 45 drill holes at Area 1, 12 drill holes at the B Zone, 2 holes at the Armstrong Showing, 4 holes at the Dominion Showing, 3 holes at Area 3 and 2 holes at Area 2 all located in the central portion of the Moran Lake property. Several other areas have also been drill tested, including Moran Heights (25 holes), Area 51 (13 holes), Croteau Lake (6 holes), and Madsen Lake (9 holes). All programs have been helicopter supported producing BTW size drill core.

Otter and Portage Lake Properties

On December 2, 2005, we entered into an agreement with a private company for an option to acquire a 100% interest (subject to a 1.5% NSR) in the Otter and Portage Lake properties totaling 56 claims. The new claims are located in the southern portion of the property, considered by our geological team as being highly prospective for Michelin or “shear zone type” uranium deposits. (Michelin is an advanced uranium project located 60 kilometers east-northeast of the Moran Lake property with inferred reserves of 32 million pounds of U₃O₈.) The Otter andPortage Lake properties host previously known uranium occurrences discovered in the 1950’s, but which have not been thoroughly explored. Surface sampling has returned up to 2% U₃O₈from grab sampling along a four kilometer strike length of anomalous radioactivity. Geological mapping, rock sampling, as well as Alpha Track, till sampling and lake sediment surveys are being carried out in order to prioritize targets for diamond drilling in 2008. The option agreement calls for:

i)	Making cash payments:

		Amount
Upon execution of the agreement	$	25,000	(Paid in December 2005)
On or before December 2, 2006		30,000	(Paid in December 2006)
On or before December 2, 2007		35,000
On or before December 2, 2008		50,000
	$	140,000

ii)	Issuing common shares:

	Number of shares
Upon acceptance by the TSX	Venture
Exchange	50,000	(Issued in January 2006)
On or before December 2, 2006	75,000	(Issued in December 2006)
On or before December 2, 2007	100,000
	225,000

iii)	Incurring a total of $600,000 in exploration expenditures:

		Amount
On or before December 2, 2006	$	100,000	(Requirement met)
On or before December 2, 2007 an additional		200,000
On or before December 2, 2008 an additional		300,000
	$	600,000

As at April 30, 2007, the Company incurred $208,765 in exploration expenditures, paid $55,000 in cash, and issued 125,000 common shares at a value of $291,750 for acquisition costs.

South Golden Promise (& Victoria Lake), Wings Point-Titan, Glenwood Break Properties

In February 2003, the Company entered into three option-JV agreements with Paragon Minerals (formerly Rubicon Minerals) to acquire three separate interests in up to 2,515 mineral claims in the Botwood Basin area of Central Newfoundland. The agreements cover three separate land packages known as “South Golden Promise”, “Wings Point-Titan” and “Glenwood Break”. The Company had the right to acquire a 60% interest in the properties by issuing up to 1,200,000 shares (400,000 for each property) and by incurring aggregate exploration expenditures of $5,250,000 (Glenwood Break - $2,000,000; Wings Point - $1,500,000; South Golden Promise - $1,750,000) within four years of September 2003.

Wings Point-Titan

The assay results received for Phase 2 program completed in spring 2005 were not significant enough to warrant further exploration on the property. At this time the Company has no further obligations in respect to this property and has accordingly written off a total of $374,522.

Glenwood Break Property

The Company elected to terminate the Glenwood Break option in the second quarter of 2006. At this time the Company has no further obligations in respect to this property and has accordingly written off a total of $884,096.

South Golden Promise (& Victoria Lake)

At April 30, 2007, the Company incurred $1,647,312 (net of $22,150 credits received) in exploration expenditures, issued 400,000 common shares at a value of $328,000 and paid cash to the vendor of $27,500, in relation to the South Golden Promise Project.

During the year ended April 30, 2007, the company advanced $370,000 to Paragon Minerals for Southern Golden Promise exploration costs and at April 30, 2007, Paragon Minerals had spent $562,482 on behalf of the Company. As a result the Company owes Paragon Minerals $192,482.

The first phase of reconnaissance drilling at Victoria Lake was very successful in outlining multiple horizons of strongly altered, sulphide-bearing felsic volcanic rocks that could host a significant precious-metal rich massive sulphide deposit. The encouraging results received from the widely spaced drilling are strongly suggestive of a proximal VHMS environment.

The 11 hole, 2198 meter program tested several precious metal-rich massive sulphide targets on four widely spaced grids underlain by highly prospective volcanic rocks similar to those hosting the nearby high grade Boomerang Cu-Pb-Zn massive sulphide deposit being explored by Messina Minerals.

North Paul’s Pond Gold Property

The assay results received for the diamond-drilling program completed in spring 2005, although locally anomalous, were not significant enough to warrant further exploration on the property. As a result the Company terminated its option on the North Paul’s Pond Gold property on June 22, 2005. At this time the Company has no further obligations in respect to this property and has accordingly written off a total of $139,754.

Utah

Sinbad claims

The Sinbad claims, located in Emery County, Utah, were transferred to the Company on January 17, 2006 for $4,125 and $11,724 was incurred in relation to geological work. The Company has recently entered into an agreement with Target Exploration & Mining Corp. (a related party by way of common directors with the Company) for the sale of the Sinbad claims for a cash payment in the amount of $31,698. The Company will retain a 2% net smelter royalty. Subsequently, this agreement was approved by the TSX Venture Exchange.

Liaoning Province, Northeast China

Beigou Gold Property

On September 16, 2004 the Company entered into a letter of intent with the Liaoning Non-ferrous Geological Bureau (the “Bureau”) in China for a formal joint venture of the Beigou Gold Project. On December 2, 2004, the Company announced the completion of a formal joint venture agreement with the Bureau following completion of a NI 43-101 report on the Beigou Gold project. The original agreement was amended and restated on April 18, 2005. The Company could earn an 80% interest in the Property by making exploration expenditures in the aggregate amount of US$3,500,000 and making cash payments to the Bureau in the amount of US$500,000, all over a five year period. A finder's fee of US$100,000, 1,000,000 common shares, and a 1% NSR, was to be paid to a third party over a five year period.

Based on the decision to concentrate its efforts in North America, on December 20, 2005 the Company decided not to continue with the Beijou Gold Property in China. At this time the Company has no further obligations in respect to this property and has accordingly written off a total of $229,935.

ITEM 5. OPERATING AND FINANCIAL REVIEW AND PROSPECTS

The following discussion for fiscal years 2007, 2006 and 2005 should be read in conjunction with our audited financial statements for the referenced periods and the notes thereto, and in particular Note 13 related to Differences Between Canadian and United States Generally Accepted Accounting Principles, included in this Annual Report. Our financial statements have been prepared in accordance with Canadian GAAP and reconciled to US GAAP. We are a Canadian company and therefore our financial statements have been prepared in Canadian dollars.

Overview

The Company is a mineral exploration company engaged in acquiring, exploring and developing mineral properties (primarily uranium, base and precious metals). The Company does not have any producing mineral properties at this time. The Company’s business is presently focused on the exploration and evaluation of various mineral deposits in North America. On February 10, 2006 the Company graduated to Tier 1 on the TSX Venture Exchange and as of May 2, 2007, the Company received approval to list its shares on the American Stock Exchange.

The Company is currently focusing its exploration activities on the following projects:

South Golden Promise (including South Golden Promise and Victoria Lake projects) and Golden Promise projects located in the Province of Newfoundland and Labrador, Canada, acquired through option agreements with Paragon Minerals in February 2003 and May 2006.
Central Mineral Belt Project (including Moran Lake) located in Labrador, Newfoundland and Labrador, Canada acquired through 2 separate option agreements in November 2004 and May 2007.

Critical Accounting Policies

Our accounting policies are described in Note 2 of the financial statements for the year ended April 30, 2007. We consider the following policies to be most critical in understanding our financial results:

Use of Estimates

Our management is required to make judgments, estimates and assumptions that affect our reported amounts of assets and liabilities at the date of our financial statements and the reported amounts of revenues and expenses during the reporting period. On a regular basis, we evaluate our estimates and assumptions. We base our estimates on historical experience and on various other assumptions that are believed to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources. Actual results may differ from these estimates under different assumptions or conditions.

Mineral Properties

Costs related to the acquisition, exploration and development of mineral properties are capitalized by property until the commencement of commercial production. If commercially profitable ore reserves are developed, capitalized costs of the related property are reclassified as mining assets and amortized using the unit of production method. If, after management review, it is determined that capitalized acquisition, exploration and development costs are not recoverable over the estimated economic life of the property, or the property is abandoned, or management deems there to be an impairment in value, the property is written down to its net realizable value.

Stock-Based Compensation

We have an employee stock option plan. We recognize an expense arising from stock options granted to both employees and non-employees using the fair value method. The fair value of option grants is generally established

at the date of grant using the Black Scholes option pricing model and the compensation amount, equal to the option’s fair value, is then recognized over the options vesting periods.

Recent Accounting Pronouncements

Costs associated with exit or disposal activities

In July 2002, the Financial Accounting Standards Board (“FASB”) issued Statement of Financial Accounting Standards No. 146 “Accounting for Costs Associated with Exit or Disposal Activities” (“FAS 146”). FAS 146 addresses financial accounting and reporting for costs associated with exit or disposal activities, and is effective for exit or disposal activities initiated after December 31, 2002. FAS 146 nullifies Emerging Issues Task Force Issue No. 94-3 (“EITF 94-3”) Liability Recognition for Certain Employee Termination Benefits and Other Costs to Exit an Activity (including Certain costs Incurred in Restructuring). The principal difference between FAS 146 and EITF 94-3 relates to the recognition of a liability for a cost associated with an exit or disposal activity. FAS 146 requires that the cost associated with an exit or disposal activity be recognized when the liability is incurred, whereas under EITF 94-3 the liability is recognized at the date of an entity’s commitment to an exit plan. This is substantially consistent with the CICA EIC Abstract 135, “Accounting for Costs Associated with Exit and Disposal Activities (including Costs Incurred in a Restructuring).” We are currently assessing the impact of FAS 146 and EIC Abstract 135 on our financial position and results of operations.

Guarantees

In November 2002, the FASB issued Interpretation No. 45, “Guarantor’s Accounting and Disclosure Requirements for Guarantees, Including Indirect Guarantees of Indebtedness of Others”, which requires certain disclosures to be made by a guarantor in its interim and annual financial statements for periods ending after December 15, 2002 about its obligations under guarantees. FIN 45 also requires the recognition of a liability by a guarantor at the inception of certain guarantees entered into or modified after December 31, 2003. FIN 45 requires the guarantor to recognize a liability for a non-contingent component of certain guarantees; that is, it requires the recognition of a liability for the obligation to stand ready to perform in the event that specified triggering events or conditions occur. The initial measurement of this liability is the fair value of a guarantee at inception. This is substantially consistent with the CICA Accounting Guideline AcG-14, Disclosure of Guarantees. We do not have any guarantees under these standards.

Variable interest entities

The FASB has published a revision to Interpretation 46 to clarify some of the provisions of FASB Interpretation No. 46, Consolidation of Variable Interest Entities, and to exempt certain entities from its requirements. The additional guidance is being issued in response to input received from constituents regarding certain issues arising in implementing Interpretation 46.

Under the new guidance, special effective date provisions apply to enterprises that have fully or partially applied Interpretation 46 prior to issuance of this revised Interpretation. Otherwise application of Interpretation 46R (or Interpretation 46) is required in financial statements of public entities that have interests in securities that are commonly referred to as special-purpose entities for periods ending after December 15, 2003. Application by public entities, other than small business issuers, for all other types of variable interest entities is required in financial statements for periods ending after March 15, 2004. Application by small business issuers to variable interest entities other than special-purpose entities and by nonpublic entities to all types of variable interest entities is required at various dates in 2004 and 2005. In some instances enterprises have the option of applying or continuing to apply Interpretation 46 for a short period of time before applying this revised Interpretation. We do not have any interests in variable interest entities, under this standard.

Effective May 1, 2006, the beginning of the Company’s 2007 fiscal year, the Company decided to early adopt the following new accounting standards issued by the Canadian Institute of Chartered Accountants (CICA) relating to

financial instruments. These new standards have been adopted on a prospective basis with no restatement to prior period financial statements. The following summarizes the new accounting standards:

Financial Instruments and Comprehensive Income

These new recommendations of the CICA are for the accounting for comprehensive income (CICA Handbook Section 1530), and for the classification, recognition and measurement of financial instruments (CICA Handbook Section 3855) that apply to the Company – see note 2 to the audited financial statements of the Company for the year ended April 30, 2007. The concept of comprehensive income is to include unrealized changes in the value of financial instruments in shareholders’ equity under the heading “Accumulated other comprehensive income”. The policy’s most significant impact on the Company is with respect to the treatment of the Company’s marketable securities, which are now accounted for at fair value with gains and losses reported in the statement of operations. There were no other significant impacts on the Company’s’ financial statements as a result of these new recommendations.

Hedging (CICA Handbook Section 3865). This new standard specifies the circumstances under which hedge accounting is permissible and how hedge accounting may be performed. The Company currently does not have any hedges.

Accounting changes (CICA Handbook Section 1506). This standard allows for voluntary changes in accounting policy only when such changes enhance the relevance and reliability of the financial statements and the comparability of those financial statements over time and with the financial statements of other entities. The standard requires changes in accounting policy to be applied retrospectively unless doing so is impracticable, requires prior period errors to be corrected retrospectively and calls for enhanced disclosures about the effects of changes in accounting policies, estimates and errors on the financial statements.

Any impact that the adoption of Section 1506 will have on our results of operations and financial condition will depend on the nature of future accounting changes. Its adoption has had no impact on these financial statements. There was no effect on opening equity as of May 1, 2006 as a result of applying these new standards.

Effective for fiscal periods commencing January 1, 2008, the Company will adopt new CICA standards relating to capital disclosures and financial instruments disclosure and presentation, and, effective January 1, 2009, a standard relating to goodwill and intangible assets. The Company is currently assessing the impact of these new accounting standards on its financial statements.

Capital Disclosures (Section 1535). This standard establishes standards for the disclosure of (i) an entity’s objectives, policies and processes for managing capital; (ii) quantitative data about what the entity regards as capital; (iii) whether the entity has complied with any capital requirements and (iv) if it has not complied, the consequences of such non-compliance.

Financial Instruments Disclosures (Section 3862) and Financial Instruments – Presentation (Section 3863). These two standards replace the current standard “Financial Instruments – Disclosure and Presentation” (Section 3861), revising and enhancing its disclosure requirements, and carrying forward unchanged its presentation requirements. These new Sections place increased emphasis on disclosures about the nature and extent of risks arising from financial instruments and how the entity manages those risks.

Goodwill and Intangible Assets (Section 3064). This new standard replaces the current standard for goodwill and intangible assets, Section 3062, and establishes revised standards for the recognition, measurement, presentation and disclosure of goodwill and intangible assets. The new standard also provides guidance for the treatment of preproduction and start-up costs and requires that these costs be expensed as incurred.

US GAAP Reconciliation

Under Canadian GAAP, it is acceptable to defer mineral property acquisition and exploration costs until a decision to abandon the property is made, it is determined that the property does not have economically recoverable reserves or that a company is unlikely to pursue exploration activities on the property. Under U.S. GAAP, mineral exploration costs are expensed until it can be proven that economically viable reserves are present on the property and a company has the ability and intention to pursue exploitation of these reserves.

Under Canadian GAAP, cash flows relating to mineral property exploration costs are reported as investing activities. For U.S. GAAP, these costs would be characterized as operating activities.

Under Canadian GAAP, future income taxes are calculated based on enacted or substantially enacted tax rates applicable to future years. Under U.S. GAAP, only enacted rates are used in the calculation of future income taxes. This GAAP difference did not result in a difference in our financial position, results of operations or cash flows for the years ended April 30, 2007, 2006 and 2005.

We have adopted the fair value based approach to Stock Based Compensation under the provisions of CICA 3870 and SFAS No. 148. The method of adoption applied by us is permissible under both Canadian and US standards.

5.A. Operating Results

Results of Operations for the year ended April 30, 2007 compared to the year ended April 30, 2006

For the year ended April 30, 2007, we incurred a net loss of $5,533,011 ($0.09 per share) compared to a net loss of $2,175,473 ($0.05 per share) for the prior year. We had no operating revenue in either period. The loss is comprised of the general and administrative expenses of $6,584,203, of which $3,696,601 was for stock-based compensation (2006 – $2,410,229, of which $682,213 was for stock-based compensation) and property write-offs of $Nil (2006 - $1,518,429). Management fees and interest income of $385,287 (2006 - $245,065) and realized/unrealized gains on marketable securities of $665,905 (2006 - $Nil) offsets the operating loss.

In the year ended April 30, 2007 compared to the same period in the prior year, we increased our exploration, corporate and financing activities. For example there was an increase in exploration activities on the Moran Lake Property and Golden Promise Property and we hired and appointed new employees, officers, directors and contractors. The additional administration, accounting and management time was required as we increased our business activities. As a result, our operating expenses increased by $4,173,974 in the year ended April 30, 2007 compared to the same period of 2006. The major expense categories were conferences and exhibitions $99,448 (2006 - $Nil); insurance $35,897 (2006 - $Nil); investor relations expense $143,773 (2006 - $130,364); legal fees $212,486 (2006 - $100,700); office and administration $562,642 (2006 - $339,703); stock-based compensation $3,696,601 (2006 - $682,213); travel $306,978 (2006 - $165,538); and wages and salaries expense $923,743 (2006 - $41,441). 72% of this the increase in operating expenses is related to stock-based compensation expense.

Results of Operations for the year ended April 30, 2006 compared to the year ended April 30, 2005

For fiscal 2006, we incurred a net loss of $2,175,473 (loss per share - $0.05) compared to a net loss of $645,386 (loss per share - $0.03) for fiscal 2005. The loss is comprised of general and administrative expenses of $2,410,229 in fiscal 2006 compared to $1,243,921 in fiscal 2005, and property write-offs of $1,518,429 in fiscal 2006 compared to $188,988 in fiscal 2005. The net loss was offset by management and interest income of $245,065 in fiscal 2006 compared to $32,803 in fiscal 2005 and future income tax recoveries of $1,508,120 in fiscal 2006 compared to $754,720 in fiscal 2005.

In fiscal 2006 compared to fiscal 2005, we increased our exploration, corporate and financing activities such as exploring new properties such as the Moran Lake Property, hiring and appointing new officers, directors and contractors. The additional administration, accounting and management time was required as we became more active. As a result, our operating expenses increased by $1,166,308 in fiscal 2006 compared to fiscal 2005. The

major expense categories were stock-based compensation of $682,213 in fiscal 2006 compared to $316,521 in fiscal 2005; consulting fees of $244,534 in fiscal 2006 compared to $182,227 in fiscal 2005; directors fees of $63,000 in fiscal 2006 compared to $5,000 in fiscal 2005; management fees of $225,000 in fiscal 2006 compared to $158,931 in fiscal 2005; legal fees of $100,700 in fiscal 2006 compared to $79,300 in fiscal 2005; property investigations of $93,467 in fiscal 2006 compared to $28,776 in fiscal 2005; travel expenses of $165,538 in fiscal 2006 compared to $60,623 in fiscal 2005; and office and miscellaneous expenses of $339,703 in fiscal 2006 compared to $120,993 in fiscal 2005.

Exploration Expenditures

During fiscal 2007 and fiscal 2006, we incurred the following expenditures on exploration of properties as follows:

	Apr. 07 Quarter	Jan. 07 Quarter	Oct. 06 Quarter	July 06 Quarter	April 06 Quarter	Jan. 06 Quarter	Oct. 05 Quarter	July 05 Quarter
Current Properties
Golden Promise	167,450	229,409	205,548	252,997	Nil	Nil	Nil	Nil
Moran Lake Property (Central Mineral Belt Project)	2,557,718	1,505,655	2,888,512	1,357,210	781,868	701,278	680,903	50,066
Otter / Portage Lake (Central Mineral Belt Project)	Nil	276,750	149,918	58,447	(2,400)	72,800	Nil	Nil
Sinbad Claims	Nil	Nil	2,351	776	8,597	4,125	Nil	Nil
South Golden Promise (Victoria Lake)	7,119	297,887	473,612	200,172	62,427	89,472	190,921	144,912
Properties written-off
Glenwood Break	Nil	Nil	Nil	Nil	Nil	Nil	(892,998)	107,836
Wings Point-Titan	Nil	Nil	Nil	Nil	Nil	Nil	(408,234)	15,825
Beigou Gold Property	Nil	Nil	Nil	Nil	Nil	(229,935)	21,562	24,544
Other Properties	Nil	Nil	Nil	Nil	Nil	Nil	Nil	Nil
Total	2,732,287	2,309,701	3,719,941	1,869,602	850,492	637,740	(407,846)	343,183

During the year ended April 30, 2007, we spent a total of $10,631,531 on our properties (including $242,500 paid in cash and $1,078,150 from the issuance of 445,000 common shares related to acquisition costs) compared to 2,954,385 incurred during the year ended April 30, 2006. During the year ended April 30, 2007, we had property write-offs totaling $Nil compared to $1,518,429 during the year ended April 30, 2006.

During fiscal 2006, we spent a total of $2,954,385 on our properties (including $317,000 acquisition costs paid by the issuance of 400,000 common shares and $390,368 in grant assistance received) compared to $1,755,334 (including 940,000 common shares at a value of $245,000 for property acquisition) incurred during fiscal 2005. During fiscal 2006, we had property write-offs totaling $1,518,429 compared to $188,988 during fiscal 2005.

During the second quarter of 2006, we elected to terminate our options in the Glenwood Break property and the Wings Point-Titan property and consequently mineral property costs of $884,096 and $374,522 were written off. In addition, during the second quarter of 2006, we received a total $68,019 of exploration grant assistance from the government for the Glenwood Break property and the Wings Point-Titan property. As a result of these two factors, the Glenwood Break property and the Wings Point-Titan property resulted in a negative $892,998 and $408,234 in exploration expenditures for fiscal 2006 shown in the table above.

Based on the decision to concentrate its efforts in North America, on December 20, 2005 the Company decided not to continue with the Beijou Gold Property in China. As a result $229,935 was written off in the third quarter of fiscal 2006.

5.B. Liquidity and Capital Resources

Liquidity – April 30, 2007, April 30, 2006 and April 30, 2005

We had cash on hand of $14,311,417, $13,947,976 and $4,746,707 as of April 30, 2007, 2006 and 2005, respectively. Our working capital was $15,390,704, $14,093,821 and $4,512,628 as of April 30, 2007, 2006 and 2005, respectively. We currently have sufficient cash resources to meet our ongoing obligations as they become due.

Our major source of financing is from the sale of Common Shares, the exercise of stock options and warrants, if any. We have sufficient funds to meet our working capital requirements and property maintenance costs and to carry out some exploration of our mineral properties for the next 12 months. During that period the amount of funds available for exploration of our mineral properties and acquisition of additional mineral properties are dependent on whether and how much we can raise in additional equity financing.

Financings – Fiscal 2007

During February and March 2007, we raised approximately $7.9 million through the exercise of warrants and issuance of additional Common Shares. Warrants to purchase 5,028,750 Common Shares were exercised, raising approximately $7.2 million, and a total of 490,375 additional Common Shares were issued, raising approximately $700,000.

Financings – Fiscal 2006

On November 3, 2005, we closed a brokered private placement with Pacific International Securities (the “Agent”), which consists of 4,000,000 flow-through units (the “FT Units”) at a price of $1.00 per FT Unit for aggregate proceeds of $4,000,000 and 8,977,500 non-flow-through units (the “Common Share Units”) at a price of $0.80 per Common Share Unit for aggregate proceeds of $7,182,000. Each FT Unit is comprised of one flow-through common share and one-half of one transferable non-flow through share purchase warrant. Each whole warrant entitles the holder to purchase one common share of the Company at a price of $1.75 per share until November 3, 2007. Each Common Share Unit is composed of one non-flow-through common share and one half of one transferable non-flow through share purchase warrant. Each whole warrant entitles the holder to purchase one common share of the Company at a price of $1.25 per share until November 3, 2007.

The Agent was entitled to a commission of 7% of the gross proceeds of the placement, $460,547 of which was taken in cash and $322,193 in 402,741 Common Share Units. The Agent was also issued 1,297,750 compensation options equal to 10% of the number of units sold. Each compensation option entitles the Agent to acquire one Common Share Unit of the Company at an exercise price of $0.85 for a period of two years. All securities issued pursuant to this offering are subject to a four-month hold period commencing November 3, 2005.

Financings – Fiscal 2005

During the year ended April 30, 2005, we completed five financings:

On May 31, 2004, we completed a private placement of 4,080,000 flow-through shares at a price of $0.25 per share for gross proceeds of $1,020,000. The agent received an 8% commission of the gross proceeds and 326,400 broker’s warrants exercisable into common shares at $0.25 per share for a period of 12 months. The broker’s warrants were all exercised during the year ended April 30, 2005 and provided us with another $81,600. Share issue costs of $138,896 were incurred in relation to this private placement.

On November 26, 2004, we completed a non-brokered private placement of 1,525,000 units at a price of $0.25 per unit for gross proceeds of $381,250. Each unit is comprised of one common share and one non-transferable share purchase warrant. Each warrant entitles the holder to purchase one common share at a price of $0.30 per share until November 27, 2005. The warrants contain a forced exercise provision. As of April 30, 2005, 20,000 warrants associated with this private placement were exercised. Share issue costs of $1,410 were incurred in relation to this private placement.

On December 14, 2004, we completed a non-brokered private placement of 2,750,000 units at a price of $0.40 per unit, for gross proceeds of $1,100,000. Each unit is comprised of one flow-through common share and one half of one non-transferable share purchase warrant. Each whole warrant is exercisable until December 14, 2005, and entitles the holder to purchase one common share at a price of $0.50 per share. We paid a finder’s fee equal to 7% of the aggregate gross proceeds raised from the private placement totaling 192,500 units. Each finder’s fee unit includes one common share and one share purchase warrant with the same terms. Share issue costs of $81,385 were incurred in relation to this private placement.

On January 11, 2005, we completed a private placement of 1,000,000 units at a price of $0.30 per unit for aggregate gross proceeds of $300,000. Each unit is comprised of one common share and one non-transferable share purchase warrant. The warrant entitles the holder to acquire one common share at a price of $0.40 per share until January 11, 2006. The warrants contain a forced exercise provision. In the event that the closing price our shares exceeds $0.60 per common share for 10 consecutive trading days after the four month hold period, the exercise period of the warrants will be shortened to a period of 30 days from the date that we provide written notice to the holders of the warrants of such an early expiry. Share issue costs of $2,240 were incurred in relation to this private placement.

On March 15, 2005, we completed a private placement of 5,622,220 units at a price of $0.45 per unit for aggregate gross proceed of $2,529,999. Each unit is comprised of one common share and one half of one transferable share purchase warrant. Each whole warrant entitles the holder to acquire one common share at a price of $0.75 per share until March 15, 2007. We paid a commission equal to 7% of the aggregate gross proceeds raised from the private placement totalling $177,100, of which $91,210 was taken in cash and the remainder of $85,890 in 190,867 units with the same terms. Share issue costs of $273,561 were incurred in relation to this private placement. In addition, 562,222 compensation options were issued to the broker in connection with this private placement. Each compensation option is exercisable into a unit at a price of $0.50 per unit for a period of two years. Each unit consists of one common share and one half of one transferable share purchase warrant with the same terms.

Capital Resources

Our authorized capital consists of unlimited number of common shares without par value. At April 30, 2007, we had 70,912,072 issued and outstanding common shares compared to 58,356,045 at April 30, 2006, and at September 30, 2007, we had 71,740,789 issued and outstanding common shares.

We adopted a formal written stock option plan on July 26, 2004. Under this plan, we may grant options for up to 2,752,240 common shares to directors, employees, consultants and certain other service providers at exercise price to be determined by the Board by not less than closing market price on the date preceding the grant less 25% discount. Option shares are subject to the minimum vesting requirement, with 25% of the total number of the options granted to be released every 6 months from the date of grant. The options can be granted for a maximum term of 5 years. The Stock Option Plan was approved by the TSX Venture Exchange on September 21, 2004. On February 10, 2006 we amended the Stock Option Plan to grant options for up to 11,308,528 common shares in order to reflect our increased issued and outstanding capital. On July 9, 2007 we further amended the terms of the Stock Option Plan to allow for the extension of options by up to ten business days in the event that an option expires during a time when the Company’s directors, employees and consultants are subject to a Company imposed black out period.

During the year ended April 30, 2007, 2,672,764 stock options were exercised, 700,000 stock options were cancelled or expired and 5,990,000 stock options were granted. As at April 30, 2007 the Company had 8,981,984 (of which 2,753,484 were exercisable) options outstanding at exercise prices ranging from $0.25 per share to $3.10

per share with expiry dates ranging from November 2, 2007 to April 23, 2012. Subsequent to April 30, 2007, 80,000 stock options were cancelled, 118,250 stock options and 21,500 agent’s options were exercised for total proceeds of $76,775. If exercised, the remaining 8,762,234 stock options would increase the Company’s available cash by $14,013,731.

As at April 30, 2007, we had 380,244 warrants outstanding at an exercise price of $1.25 per share with an expiry date of November 3, 2007. If exercised, these remaining warrants would increase our available cash by $475,305.

Contributed surplus was $3,888,533 as at April 30, 2007 (April 30, 2006 - $1,188,003). The increase of $2,700,530 represents $3,696,601 of the fair value of the options released in the year ended April 30, 2007 less $996,071 of the fair value of stock options and warrants exercised. The fair value of the outstanding options and compensation options was calculated using the Black-Scholes method of valuation.

5.C. Research and Development, Patents and Licenses, etc.

We are a mineral exploration company and do not engage in conventional research and development. We have not incurred research and development expenses or adopted research on development policies within the last three fiscal years.

5.D. Trend Information

We are a mineral exploration company. Consequently, there is no production, sales, or inventory in the conventional sense. Our financial success will be dependent upon the extent to which we can discover mineralization and the economic viability of developing such properties. Such development, if initiated, may take years to complete and the amount of resulting income, if any, is difficult to determine with any certainty. We have no mineral reserves and to date have not produced any revenues. The sales value of any mineralization discovered by us is largely dependent upon factors beyond our control such as the market value of the metals produced.

Other than as disclosed herein, we are not aware of any trends, uncertainties, demands, commitments or events which are reasonably likely to have a material effect upon our net sales or revenues, income from continuing operations, profitability, liquidity or capital resources, or that would cause reported financial information not necessarily to be indicative of future operating results or financial condition.

The major factors that caused significant variations in net loss were the recording of stock based compensation when stock options were granted and the write-down of properties based on a periodic review of such properties, both of which have no identifiable trend.

5.E. Off-Balance Sheet Arrangements

Not applicable

5.F. Tabular Disclosure of Contractual Obligations

As at April 30, 2007, we had the following contractual obligations:

		Payments due by period
				Less than 1						More than 5
Contractual Obligations		Total		year		1-3 years		3-5 years		years
Capital (Finance) Lease Obligations	$	--	$	--	$	--	$	--	$	--
Operating Lease Obligations		208,835		76,804		173,344		83,445		--
Total	$	208,835	$	76,804	$	173,344	$	83,445	$	--

ITEM 6. DIRECTORS, SENIOR MANAGEMENT, AND EMPLOYEES

6.A. Directors and Senior Management

Name	Age	Position

Mark J. Morabito	41	President, CEO and Director

C. Stewart Wallis ⁽²⁾	63	Director

Jay Sujir ⁽²⁾	49	Director

David Ying Tat Lee ⁽¹⁾⁽²⁾	59	Director

Geir L. Liland	58	Director

Ian B. Smith ⁽¹⁾	62	Director

Leo Power ⁽¹⁾	45	Director

Christopher Collingwood	60	Director

J. Wayne Pickett	53	Vice President, Exploration

Julie L. Bolden	43	VP Corporate Affairs and Corporate Secretary

Douglas R. Brett	54	Chief Financial Officer

Daniel McIntyre	38	VP Investor Relations

____________________

(1)	Member of Audit Committee
(2)	Member of Compensation Committee

We are an exploration stage junior exploration company. As such, we have historically operated without full-time employees and our corporate functions were primarily administered through private consulting companies owned by our current senior management. Our needs will be dependent upon our level of exploration programs and financial condition. In 2006, we began entering into employment agreements with our senior officers and currently have employment agreements with Messrs. Morabito, Pickett and McIntyre and Ms. Bolden. In addition, we entered into a consulting agreement with Douglas Brett and his affiliate for Mr. Brett to act as our Chief Financial Officer. See Item 6.B. Compensation – Employment and Consulting Agreements.

Set forth below are brief descriptions of recent employment and business experience of our directors and senior management.

Mark J. Morabito has been our President and CEO since February of 2003 and a Director since November of 1998. Mr. Morabito devotes 70% of his time during a typical work week to our business. He is also currently the CEO and a Director of Target. Target currently trades on the TSX Venture Exchange under the symbol “TEM”.

Target is not engaged, and does not plan to be engaged, in mining exploration in the same geographical areas as us, nor do we plan to pursue mining and exploration opportunities in areas in which Target operates. Mr. Morabito owns 4.48% of the issued and outstanding shares of Target. We have no formal measures in place to prevent a conflict of interest and independent directors are required to approve any transactions we complete with Target. All transactions with Target are disclosed as related party transactions and reviewed. We believe the transactions we have completed with Target have been fair to us and to our disinterested shareholders. Effective September 1, 2007, we entered into a cost sharing arrangement with Target whereby Target reimburses us for 30% of common operating expenditures including rent and salaries of certain employees who divide their time between Target and us.

Mr. Morabito also serves on the board of directors of Tequila Minerals Corp. and Silver Quest Resources Ltd. From 2000 to 2003 he was the General Counsel and Vice President of Corporate Affairs for Leisure Canada Inc. From 1995 to 2000 he was an Associate Lawyer for Owen Bird, Barristers and Solicitors in Vancouver, British Columbia and for Anfield Sujir Kennedy & Durno, Barristers and Solicitors also located in Vancouver, British Columbia. He received his Bachelor of Law degree from the University of Western Ontario located in London, Ontario in 1993 and his Bachelor of Arts Degree from Simon Fraser University in Vancouver, British Columbia in 1990.

Mr. Morabito was a director of Lima Gold Corporation (a prior name of the Company), which on February 10, 1999 was the subject of a Section 164 Cease Trade Order for failure to file financial statements. The Cease Trade Order was rescinded on April 14, 1999. At the time the Company did not have an active business and was undergoing extensive reorganization.

C. Stewart Wallis has been a member of our Board of Directors since June 2003 and is also a director of Target and Patrician Diamonds Inc. He was the Managing Director of Sundance Ventures, a private entity owned and controlled by him, from 1994 until 2000, at which time he joined Pincock, Allen & Holt Ltd. He was Principal Geologist in Vancouver with that company until he rejoined Sundance Ventures in 2002. Sundance Ventures provides geological services, including evaluations and prefeasibility studies, for individuals and mining companies based throughout the world. Mr. Wallis was the General Manager, Vancouver office, for Roscoe Postle Associates Inc. from 2003 to October 2006. He is currently consulting for a number of clients in the mining industry through Sundance Geological Ltd. a private entity owned and controlled by him. He received his Bachelor of Science Degree in Geology from McMaster University, located in Hamilton, Canada. His professional affiliations include: Association of Professional Engineers and Geoscientists of Saskatchewan, the Association of Professional Engineers and Geoscientists of British Columbia, Wyoming Professional Geologist, Certified Professional Geologist, Fellow, Society of Economic Geologists and a Member of the Society of Mining Engineers.

Jay Sujir has been a member of our Board of Directors since February 2003 and is a current director of AMI Resources Inc., Escape Group Inc., Midasco Capital Corp., Target, Tequila Minerals Corp., Uracan Resources Ltd. and Yamiri Energy and Gold Inc. Mr. Sujir is also the Chairman of bcMetals Corp. He is a securities and natural resource lawyer who has experience with advising and assisting public companies. He obtained his B.A. from the University of Victoria in 1981 and obtained his LL.B. from the University of Victoria in 1985. He has been a lawyer in the law firm of Anfield Sujir Kennedy & Durno and its predecessor firm since August 1986 and has been a partner of that firm since 1991.

David Ying Tat Lee has been a member of our Board of Directors since February 2004 and is a Director of DMR Financial Corporation, which is a private company. He received his Bachelor of Arts Degree from Occidental College in Los Angeles and his Master of Arts Degree from California State University. He has operated his own consulting firm since 1999. His services include sourcing manufacturing facilities and merchandise from China, training for Chinese banks, general financial consulting for companies operating in Canada and China, real estate acquisition and donations to charitable organizations.

Geir L. Liland joined our Board of Directors in June 2005 and served as our Chief Financial Officer from May 2, 2006 to July 31, 2007. He is currently a Director of Uranium North Resources Corp., Target, Pacific Imperial Mines Inc., Holcot Capital Corp., egX Group, Inc., Prescient NeuroPharma Inc., Tapango Resources Ltd. and HSF Capital Corporation. He was the Vice President, Corporate Finance for the TSX Venture Exchange from 1999 until 2002 and since that time he has been a consultant to companies listed on Canadian stock exchanges. He received his Bachelor of Arts (Economics and Commerce) from Simon Fraser University in Burnaby, British Columbia. From 1978 until 1982 he studied accounting, auditing and taxation at the Chartered Accountants Institute of British Columbia.

Leo Power has been a member of our Board of Directors since November 2006. Mr. Power received his MBA from the Joint Kellogg-Schulich Executive MBA Program at York University. Mr. Power has a combined 5 years experience in direct employment with the Government of Canada and the Government of Newfoundland and Labrador, and another 15 years as an independent Newfoundland and Labrador based business and government

relations consultant. Mr. Power served as Senior Assistant to the Honourable John C. Crosbie (1984-1989) during Mr. Crosbie’s tenure in the federal portfolios of Justice Minister and Attorney General of Canada, Minister of Transport and Minister of International Trade. He also acted as Principal Secretary to the former Premier of Newfoundland, the Honourable Tom Rideout, during his term of office in 1989, with wide ranging responsibilities including: coordination of federal-provincial activities, responsibility for political staff in both the Premier’s office and Ministers’ offices, and acting as senior contact person for provincial cabinet, bureaucracy, business community and interest groups. Mr. Power also serves on the board of directors of New Island Resources Inc. and Newfoundland Goldbar Resources Inc.

Ian B. Smith joined our Board of Directors in September 2006. Mr. Smith has over 40 years experience in corporate, operations, and project management and consulting within the international base, precious metals and coal industries. He has worked around the world including Africa, China, southeast Asia and extensively in the Americas. Mr. Smith was President and Founding Partner of ‘MRDI’ which became one of the largest and most successful mining consultancies in North America. Mr. Smith is CEO and a director of Tequila Minerals Corp. and is a director of Minco plc.

Christopher Collingwood has been a member of our Board of Directors since October 2007. Mr. Collingwood is the Chairman and CEO of Baine Johnston Corp. (“Baine Johnston”), a privately held Newfoundland firm and has been actively involved with Baine Johnston since 1967. Baine Johnston is active in commercial and industrial real estate, commercial insurance, Leon's Furniture Ltd. Franchised Operations for Newfoundland and has investments in a number of other Newfoundland companies. Mr. Collingwood is a board member of a number of Newfoundland and Labrador companies including Consilient Technologies Ltd. and Pan Maritime Energy Services Inc. He is also a past public director of the Investment Dealers Association of Canada. Mr. Collingwood earned a B.Comm from Memorial University in 1970.

Douglas R. Brett has been our Chief Financial Officer since August 1, 2007. Mr. Brett has more than 20 years experience in public practice accounting. He was the Chief Financial Officer of bcMetals Corporation from August 2003 to February 2007 and has served as an officer and director of other public companies. Mr. Brett is a Chartered Accountant and has been a member of the Institute of Chartered Accountants of British Columbia since December 1982. He obtained his B.Sc. in computer science and mathematics from the University of British Columbia.

J. Wayne Pickett has been our Vice President Exploration since August 14, 2007. Mr. Pickett received his Master of Science, Earth Science (Geology) from Memorial University, Newfoundland in 1989. He is a Registered Professional Geoscientist and a member of the Association of Professional Engineers and Geoscientists of Newfoundland and the Association of Professional Engineers and Geoscientists of British Columbia. He has over 25 years experience in mineral exploration in various parts of Canada, Mexico, Peru, Colombia and Ghana. He was part of the geology team that discovered the Collins Bay “B” Uranium deposit in northern Saskatchewan for Gulf Minerals and Bobby’s pond VMS deposit for Inco in Newfoundland.

Julie L. Bolden has been our Vice President Corporate Affairs and Corporate Secretary since August 28, 2006. Ms. Bolden also serves as the vice president corporate affairs and corporate secretary of Target. She devotes 95% of her time during a typical work week to our business. She received a Legal Assistant Certificate from Capilano College in May 1997. During the period from May 1987 until July 2006, Ms. Bolden worked as a paralegal at a number of Vancouver law firms and at a group of public companies.

Daniel McIntyre has been our Vice President Investor Relations since December 4, 2006. Prior to joining us, Mr. McIntyre spent two and a half years working at Fronteer Development Group and Aurora Energy Resources Inc. as manager of investor relations and corporate communications. Mr. McIntyre spent the years before joining Fronteer and Aurora working at HSBC Bank Canada focussing on Retail Banking, Information Technology and Risk Management. Mr. McIntyre received a BA (Honours) from the University of Western Ontario in 1991.

No Director and/or senior management had been the subject of any order, judgment, or decree of any governmental agency or administrator or of any court or competent jurisdiction, revoking or suspending for cause any license, permit or other authority of such person or of any corporation of which he is a Director and/or senior management,

to engage in the securities business or in the sale of a particular security or temporarily or permanently restraining or enjoining any such person or any corporation of which he is an officer or director from engaging in or continuing any conduct/practice/employment in connection with the purchase or sale of securities, or convicting such person of any felony or misdemeanor involving a security or any aspect of the securities business or of theft or of any felony.

There are no family relationships between any of the Directors or senior management. There are no arrangements or understandings with major shareholders, customers, suppliers or others, pursuant to which any person referred to above was selected as a Director or member of senior management.

6.B. Compensation

Because Mr. Collingwood was not appointed to the Board of Directors until October 25, 2007, there is no compensation disclosure related to Mr. Collingwood in this section.

Compensation of Executive Officers and Directors

The following table sets out the compensation information for the fiscal year ended April 30, 2007, for our directors and executive officers.

	Annual Compensation				Long Term Compensation
					Awards		Payouts
Name and	Year	Salary	Bonus	Other	Securities	Restricted
Principal Position		(CDN$)	(CDN$)	Annual	Under	Shares		All other
				Compensation	Options/SARs	Or	LTIP	Compen-
				(CDN$)	Granted (#)	Restricted	Payouts	sation
						Share Units	(CDN$)	(CDN$)
						(CDN$)
Mark J. Morabito President, CEO and Director	2007	$200,000	$200,000	$10,125	1,500,000	--	--	--

Gier Liland ⁽¹⁾ Chief Financial Officer and Director	2007	--	--	50,000	300,000	--	--	--

Timothy D.L. Froude ⁽²⁾ Senior VP, Exploration	2007	100,000	25,000	--	200,000	--	--	--

Stewart Wallis, Director	2007	--	--	54,390 ⁽⁴⁾	100,000	--	--	--

Jay Sujir Director	2007	--	--	13,500 ⁽⁵⁾	100,000	--	--	--

David Y.T. Lee Director	2007	--	--	13,500 ⁽³⁾	100,000	--	--	--

Leo Power Director	2007	--	--	6,500 ⁽³⁾	300,000	--	--	--

Ian Smith Director	2007	--	--	8,500 ⁽³⁾	300,000	--	--	--

	(1)	Mr. Liland ceased serving as our Chief Financial Officer as of July 31, 2007.
	(2)	Mr. Froude’s employment with the Company ceased on August 13, 2007.
	(3)	Director’s fees paid to non-executive directors.
	(4)	Includes directors’ fees in the amount of $13,500 and geological consulting fees in the amount of $40,890 paid to Sundance Geological Ltd. a private entity owned and controlled by Mr. Wallis. Excludes $33,075 of geological

		consulting fees to Roscoe Postle Associates Inc., a company for which Stewart Wallis was an employee until Oct 2006.
	(5)	Excludes $25,882 of legal fees paid to Anfield Sujir Kennedy & Durno Barristers & Solicitors, a limited liability partnership of which Jay Sujir is a partner.

During the fiscal year ended April 30, 2007, a total of 2,900,000 stock options were granted to our directors and executive officers as follows:

						Mkt. Value of
	% of Total					Securities
	Options Granted					Underlying
Name of Director or	as of year ended	Number Of		Exercise Price		Options on Date of
Executive Officer	Apr 30, 2007	Options Granted	Date of Grant	per Share ($)	Expiration Date	Grant ($)

Mark J. Morabito	16.69	1,000,000	5/1/06	1.32	5/1/11	1.27
	8.35	500,000	3/6/07	2.50	3/6/12	3.04
Tim Froude	1.67	100,000	5/24/06	1.32	5/24/12	1.35
	1.67	100,000	3/23/07	3.00	3/23/12	3.23
Geir Liland	2.50	150,000	5/24/06	1.32	5/24/12	1.35
	2.50	150,000	3/6/07	2.50	3/6/12	3.04
Leo Power	1.67	100,000	5/24/06	1.32	5/24/11	1.35
	1.67	100,000	11/17/06	2.26	11/17/11	2.65
	1.67	100,000	3/6/07	2.50	3/6/12	3.04
Ian Smith	2.50	150,000	8/ 21/06	1.43	8/21/11	1.76
	0.83	50,000	12/11/06	3.10	12/11/11	3.85
	1.67	100,000	3/ 6/07	2.50	3/6/12	3.04
Jay Sujir	1.67	100,000	3/6/07	2.50	3/6/12	3.04
David Lee	1.67	100,000	3/6/07	2.50	3/6/12	3.04
Stewart Wallis	1.67	100,000	3/6/07	2.50	3/6/12	3.04

The above listed options vest over a period of two years such that 25% become available for exercise every six months.

The following table gives certain information concerning stock option exercises during the year ended April 30, 2007 by our executive officers and directors. It also gives information concerning stock option values.

Aggregated Stock Options Exercises in Fiscal 2007
Fiscal Yearend Unexercised Stock Options
Fiscal Yearend Stock Option Values
Executive Officers/Directors

				Value of Unexercised In-
	Number of			the-Money Options at
	Shares		Number of Unexercised	Fiscal Year-End (1)
	Acquired on	Aggregate Value	Options at Fiscal Year-End	Exercisable/
Name	Exercise	Realized	Exercisable/Unexercisable	Unexercisable

Mark Morabito	300,000	$861,000	750,000/1,450,000	$1,315,000/1,388,000
Stewart Wallis	70,000	115,900	230,000/150,000	$ 492,200/96,000
Jay Sujir	100,000	289,000	100,000/150,000	$ 191,500/96,000
David Ying Tat Lee	20,000	68,000	180,000/150,000	$ 372,700/96,000

				Value of Unexercised In-
	Number of			the-Money Options at
	Shares		Number of Unexercised	Fiscal Year-End (1)
	Acquired on	Aggregate Value	Options at Fiscal Year-End	Exercisable/
Name	Exercise	Realized	Exercisable/Unexercisable	Unexercisable

Geir Liland	--	--	162,500/337,500	$ 295,750/306,250
Timothy Froude	97,500	235,575	215,000/225,000	$ 421,600/181,000
Ian Smith	--	--	37,500/262,500	$ 45,375/150,125
Leo Power	--	--	75,000/325,000	$ 120,000/238,000

(1) Based on the closing price of the Common Shares on the TSX Venture Exchange on April 30, 2007 of $2.64 per Common Share.

Director Compensation

Directors are entitled to reimbursement for reasonable travel and other out-of-pocket expenses incurred in connection with attendance at meetings of the Board of Directors. The Board of Directors may award special remuneration to any director undertaking any special services on our behalf other than services ordinarily required of a director. Due to the onerous amount of work associated with currently applicable securities legislation and ongoing compliance requirements, we have instituted a modest compensation plan for the non-management members of the Board of Directors, which commenced May 1, 2005. Under the compensation plan every director receives a monthly fee of $1,000 and an additional monthly fee of $500 in the event that the director serves on a committee. Directors’ fees may be deferred as appropriate based on our financial condition. We do not propose to pay or distribute any non-cash compensation during the current financial year, other than the possible grant of incentive stock options.

Stock Option Plan

We may grant stock options to directors, senior management and employees pursuant to our Amended Stock Option Plan dated July 9, 2007. Under the Amended Stock Option Plan, we may grant stock options to purchase up to a maximum of 11,308,528 Common Shares. During the fiscal year ended April 30, 2007, we granted stock options to purchase an aggregate of 5,990,000 Common Shares. During the year, stock options to purchase an aggregate of 2,672,764 Common Shares were exercised and stock options to purchase an aggregate of 700,000 Common Shares were cancelled.

Employment and Consulting Agreements

We have entered into employment agreements with Messrs. Morabito, Pickett and McIntyre and Ms. Bolden. Pursuant to the Agreements, the Company has agreed to pay a salary of $200,000 to Mr. Morabito, $100,000 to Mr. Pickett, $100,000 to Mr. McIntyre and $85,000 to Ms. Bolden. In addition, Messrs. Morabito and Pickett are eligible for bonuses in amounts not to exceed $200,000 and $50,000, respectively. The bonuses are to be paid in cash quarterly and the amounts will be determined in the discretion of the Company’s compensation committee. Ms. Bolden is also eligible for bonuses in an amount not to exceed $25,000 and Mr. McIntyre is eligible for bonuses in an amount up to 25% of his base salary. These bonuses will be paid in cash annually and the amounts will be determined in the Company’s discretion.

The agreements with Messrs. Morabito and Pickett and Ms. Bolden provide that they shall be provided with employee benefits comparable to those provided by the Company from time to time to other senior executives of the Company generally. The agreements with Messrs. Morabito, Pickett and McIntyre and Ms. Bolden provide for a grant of options to purchase 1,000,000, 50,000, 200,000 and 200,000 Common Shares, respectively, upon execution of the agreement and options to purchase 500,000, 100,000, 100,000 and 100,000Common Shares, respectively, on the first anniversary of the date of the initial grant and each anniversary thereafter. The initial options have an exercise price of $1.32, $1.56, $2.07 and $1.32 per Common Share, respectively, and the annual

options shall have an exercise price at the market price on the date they are granted. Mr. Morabito’s right to receive annual option grants is subject to the requirement that the aggregate number of incentive stock options held by Mr. Morabito at any given time not exceed 5% of the number of issued and outstanding Common Shares of the Company at such time. Mr. Pickett was also awarded a cash bonus of $20,000 and options to purchase 100,000 Common Shares upon his promotion to Vice President, Exploration, on August 14, 2007. Mr. Pickett’s options have an exercise price of $1.54 per Common Share and are subject to vesting over a two year period and will expire on August 14, 2012.

The employment agreements require the Company to pay severance to Messrs. Morabito and Froude and Ms. Bolden if it terminates their respective employment other than for “just cause” (as defined in the agreements) or if the respective employee resigns for “good reason” (as defined in the agreements). The severance payments will consist of either 24 months notice of termination or a lump sum payment equal to two times the employee’s annual salary, at the employee’s option, and continued participation in the annual option grants and benefit plans until the earliest of the expiration of the 24 month notice period and the death of the employee. Mr. McIntyre, upon termination without cause, would be entitled to six months’ notice or pay in lieu of notice equal to six months of base salary, or any combination thereof.

On August 1, 2007, we entered into an independent consulting services agreement (the “Consulting Agreement”) with Douglas R. Brett, Inc. (the “Contractor”) and Douglas R. Brett. Pursuant to the Consulting Agreement, we engaged the Contractor to provide financial services and appointed Mr. Brett as our Chief Financial Officer. Mr. Brett will personally provide to the Company such advisory and consulting services on behalf of the Contractor as the Company may request from time to time. According to the Consulting Agreement, Mr. Brett’s Services will require an average of between 40 and 60 hours of his time per month. In exchange for Mr. Brett’s services, the Company will pay to the Contractor $6,250 per month plus goods and services taxes. In addition, the Company agreed to grant to the Consultant options to acquire up to 200,000 Common Shares at a price per share equal to the prevailing fair market value, such options subject to the terms of the Company’s Stock Option Plan. The term of the Consulting Agreement shall automatically cease at 11:59 p.m. (Vancouver time) on August 1, 2008 (the “Term”), unless earlier terminated as hereinafter provided or unless the parties have agreed in writing to renew the Consulting Agreement. The Contractor and the Company each have the right to terminate the Consulting Agreement at any time by giving to the other party at least 30 days prior written notice of the effective date of such termination (the “Termination Date”). On the Termination Date, the Consultant will resign as Chief Financial Officer unless other arrangements are made.

Mr. Brett agreed to indemnify and save harmless the Company for any demonstrated losses, damages, costs or other amounts, including without limitation reasonable legal fees, suffered or incurred by the Company arising out of third party claims relating to his presence or activities or his representatives in performing the services to the extent that such losses, damages, costs or other amounts are caused by: any breach of Mr. Brett’s obligation to perform his services in full compliance with all applicable laws and consistent with a high degree of business ethics; and any negligence, wilful misconduct or fraud on the part of Mr. Brett in performing the services. Subject to Mr. Brett’s obligation to indemnify the Company as described above, and provided that Mr. Brett has not breached his obligation to perform his services in full compliance with all applicable laws and consistent with a high degree of business ethics, the Company agreed to indemnify and save harmless Mr. Brett for any demonstrated losses, damages, costs or other amounts, including without limitation reasonable legal fees, suffered or incurred by Mr. Brett arising out of third party claims relating to his presence or activities and/or his representatives in performing the services as would reasonably be the case for all directors and officers of the Company. In addition, the Company agreed that any directors’ and officers’ liability insurance coverage currently in place or obtained in the future by the Company will also be extended to Mr. Brett without charge to either Mr. Brett or the Contractor.

Post Employment Compensation

No funds were set aside or accrued by us during Fiscal 2007 to provide pension, retirement or similar benefits for directors or senior management.

Other than as described above, we do not have any plans or arrangements in respect of remuneration received or that may be received by our executive officers to compensate such officers in the event of termination of employment (as a result of resignation, retirement, change of control) or a change of responsibilities following a change of control, where the value of such compensation would exceed US$60,000 per person.

6.C. Board Practices

The Board of Directors presently consists of eight directors, all of whom were elected at the annual general meeting of the shareholders of the Company, held on September 10, 2007, except for Mr. Collingwood, who was appointed to the Board of Directors on October 25, 2007. The directors have served in their respective capacities since their election and/or appointment and will serve until the next annual general meeting or until a successor is duly elected, unless the office is vacated in accordance with our Articles. The Board of Directors appoints senior management who serve at the discretion of the Board of Directors. Mr. Morabito has served as a director of the Company since November 1998; Mr. Wallis has served as a director of the Company since June 2003; Mr. Sujir has served as a director of the Company since February 2003; Mr. Lee has served as a director of the Company since February 2004; Mr. Liland has served as a director of the Company since June 2005; Mr. Smith has served as a director of the Company since September 2006; and Mr. Power has served as a director of the Company since November 2006.

Board of Director Committees

We have an Audit Committee, which recommends to the Board of Directors the engagement of our independent auditors and reviews with the independent auditors the scope and results of our audits, our internal accounting controls, and the professional services furnished to us by our independent auditors. The current members of our Audit Committee are: Ian Smith, David Lee and Leo Power.

We have established a Compensation Committee, which currently consists of Stewart Wallis, Jay Sujir and David Lee. The mandate established for the Compensation Committee is for the purposes of:

1.	considering appropriate levels of compensation for the directors and officers and making recommendations to the Board as to the remuneration and other compensation to be provided to the directors, the president and the other officers of the Company;

2.	reviewing personnel policies and benefit plans available to employees and making recommendations to the Board of Directors; and

3.	carrying out periodic performance assessments of the President.

6.D. Employees

As of October 31, 2007, we had 20 full-time employees.

6.E. Share Ownership

The following table presents the beneficial ownership of the directors and those persons named in Item 6.B Compensation above as of October 31, 2007. As of October 31, 2007, we had 72,390,789 common shares issued and outstanding. The number of common shares beneficially owned by the persons listed below includes those securities exercisable into common shares within 60 days of October 31, 2007.

	Number of	Percent of Outstanding
Name	Common Shares	Common Shares
Mark J. Morabito	2,469,769 ⁽¹⁾	3.97%
C. Stewart Wallis	275,400 ⁽²⁾	*
Jay Sujir	175,000 ⁽³⁾	*
David Y.T. Lee	250,000 ⁽⁴⁾	*
Geir Liland	325,000 ⁽⁵⁾	*
Leo Power	232,700 ⁽⁶⁾	*
Ian Smith	145,000 ⁽⁷⁾	*
Christopher Collingwood	350,300 ⁽⁸⁾	*

	*	Indicates less than one percent
	(1)	Includes options to purchase 1,475,000 common shares
	(2)	Includes options to purchase 230,000 common shares
	(3)	Includes options to purchase 150,000 common shares
	(4)	Includes options to purchase 230,000 common shares
	(5)	Includes options to purchase 325,000 common shares
	(6)	Includes options to purchase 225,000 common shares
	(7)	Includes options to purchase 125,000 common shares
	(8)	Includes options to purchase 100,000 common shares

The following table presents the stock options granted to the aforementioned persons and unexercised as of October 31, 2007. The stock options are for Common Shares.

		Number of
		Underlying
	Date of	Common		Exercise	Expiration
Name	Grant	Shares	Vested *	Price	Date
Mark J. Morabito	Mar. 6, 2007	500,000	125,000	$2.50	Mar. 6, 2012
	May 1, 2006	1,000,000	750,000	1.32	May 1, 2011
	Jan. 18, 2006	400,000	300,000	1.00	Jan. 18, 2011
	Feb. 4, 2005	300,000	300,000	0.45	Feb. 4, 2010

C. Stewart Wallis	Mar. 6, 2007	100,000	25,000	$2.50	Mar. 6, 2012
	Jan. 18, 2006	100,000	75,000	1.00	Jan. 18, 2011
	Feb. 4, 2005	100,000	100,000	0.45	Feb. 4, 2010
	Jan. 21, 2004	25,000	25,000	0.25	Jan. 21, 2009
	Jun. 19, 2003	5,000	5,000	0.25	Jun. 19, 2008

Jay Sujir	Mar. 6, 2007	100,000	25,000	$2.50	Mar. 6, 2012
	Jan. 18, 2006	100,000	75,000	1.00	Jan. 18, 2011
	Feb. 4, 2005	50,000	50,000	0.45	Feb. 4, 2010

David Y.T. Lee	Mar. 6, 2007	100,000	25,000	$2.50	Mar. 6, 2012
	Jan. 18, 2006	100,000	75,000	1.00	Jan. 18, 2011
	Feb. 4, 2005	100,000	100,000	0.45	Feb. 4, 2010
	Feb. 17, 2004	30,000	30,000	0.25	Feb. 17, 2009

Geir Liland	Mar. 6, 2007	150,000	37,500	$2.50	Mar. 6, 2012
	May 24, 2006	150,000	112,500	1.32	May 24, 2011
	Jan. 18, 2006	100,000	75,000	1.00	Jan. 18, 2011
	Jun. 14, 2005	100,000	100,000	0.45	Jun. 14, 2010

		Number of
		Underlying
	Date of	Common		Exercise	Expiration
Name	Grant	Shares	Vested *	Price	Date
Leo Power	Mar. 6, 2007	100,000	25,000	$2.50	Mar. 6, 2012
	Nov. 17, 2006	100,000	50,000	2.26	Nov. 17, 2011
	May 24, 2006	100,000	75,000	1.32	May 24, 2011
	Jan. 5, 2006	100,000	75,000	0.90	Jan. 5, 2011

Ian Smith	Mar. 6, 2007	100,000	25,000	$2.50	Mar. 6, 2012
	Dec. 11, 2006	50,000	25,000	3.10	Dec. 11, 2011
	Aug. 21, 2006	150,000	75,000	1.43	Aug. 21, 2011

Christopher Collingwood	Oct. 24, 2007	150,000	Nil	$1.95	Oct. 24, 2012
	Dec. 11, 2006	50,000	25,000	3.10	Dec. 11, 2011
	May 1, 2006	50,000	37,500	1.32	May 1, 2011
	Jan. 18, 2006	50,000	37,500	1.00	Jan. 18, 2011

* Includes those options that are exercisable within 60 days of October 31, 2007.

We do not have any arrangements for involving the employees in the capital of the Company. We do not have a share purchase plan, dividend reinvestment plan for our directors, officers and employees. However, we will, from time to time, grant individual stock options to our directors, officers or employees as an incentive pursuant to our amended stock option plan.

ITEM 7. MAJOR SHAREHOLDERS AND RELATED PARTY TRANSACTIONS

7.A. Major Shareholders

To the knowledge of management, other than the entities listed below, no person beneficially owns 5% or more of our issued and outstanding Common Shares:

	Number of
Name	Common Shares	Percentage⁽¹⁾

David W. Tice & Associates, LLC	4,216,200 (2)	5.9%
John Burbank	3,320,233 (3)	4.6

____________________

(1)	Based on 71,740,789 Common Shares outstanding as of September 30, 2007.

(2)	This information is based on an amendment to Schedule 13G filed with the Securities and Exchange Commission on February 6, 2007, by David W. Tice & Associates, LLC and Prudent Bear Funds, Inc.

(3)	This information is based on an amendment to Schedule 13G filed with the Securities and Exchange Commission on February 15, 2007 by Passport Global Master Fund SPC, Ltd,. Partners Group Alternative Strategies PCC Limited Gold Iota Cell, Passport Holdings, LLC, Passport Management, LLC, Passport Capital, LLC and John Burbank.

Based on a Schedule 13G filed with the Securities and Exchange Commission on March 10, 2006, Goodman & Company as investment counsel and portfolio manager to various mutual funds and other clients, reported that it beneficially owned 6,607,400 Common Shares, including 1,087,500 common shares underlying warrants. An amendment to that Schedule 13G filed by Goodman & Company on September 11, 2006 reported that it had sold 3,955,000 Common Shares.

All of our shares, both issued and unissued, are common shares of the same class and rank equally as to dividends, voting powers and participation of powers. Accordingly, there are no special voting powers held by our major shareholders.

On September 30, 2007, we had 71,740,789 common shares issued and outstanding to approximately 101 shareholders of record. We believe that the number of beneficial owners is substantially greater than the number of record holders because a portion of its outstanding common stock is held in broker “street names” for the benefit of individual investors or other nominees. Management believes that there are 23 stockholders of record that are U.S. persons, who own an aggregate of approximately 5.2% of our outstanding Common Shares. In addition to these record holders there may be more U.S. persons holding our Common Shares in “street” name.

We are a publicly owned Canadian corporation, with shareholders in Canada, the United States and other foreign jurisdictions. We are not controlled by any foreign government or other person. There are no arrangements that would result in a change of control of the Company.

7.B. Related Party Transactions

Other than as disclosed below, for the year ended April 30, 2007 and the period from May 1, 2007 to the date of this annual report, we have not entered into any transactions or loans between us and any: (a) enterprises that directly or indirectly through one or more intermediaries, control or are controlled by, or are under common control with, us; (b) associates; (c) individuals owning, directly or indirectly, an interest in the voting power of us that gives them significant influence over us, and close members of any such individuals' family; (d) key management personnel and close members of such individuals' families; or (e) enterprises in which a substantial interest in the voting power is owned, directly or indirectly, by any person described in (c) or (d) or over which such a person is able to exercise significant influence.

The Company entered into transactions with related parties as follows:

	1.	We engaged the services of Anfield Sujir Kennedy & Durno Barristers & Solicitors for legal services relating to securities matters. One of our directors, Jay Sujir, is a partner of Anfield Sujir Kennedy & Durno. We paid fees directly to Anfield Sujir Kennedy & Durno in the amount of $25,882 for Fiscal 2007. Fees of $20,393 have been paid to Anfield Sujir Kennedy & Durno since April 30, 2007 through October 31, 2007. We currently expect to continue to utilize the legal services of Anfield Sujir Kennedy & Durno.

	2.	We engaged the services of Sundance Geological Ltd. (“Sundance”) for geological services. One of our directors, Stewart Wallis, is the principal of Sundance. We paid fees directly to Sundance in the amount of $27,245 during Fiscal 2007 and at April 30, 2007 $5,830 was owed to Sundance. Fees of $13,050 were paid to Sundance from April 30, 2007 through October 31, 2007. We currently expect to continue to utilize the services of Sundance.

	3.	On May 2, 2006, we engaged the services of Geir Liland to provide services ordinarily provided by a chief financial officer. We paid fees of $50,000 to Mr. Liland during the fiscal year ended April 30, 2007. Mr. Liland ceased serving as our Chief Financial Officer as of July 31, 2007.

	4.	Until May 1, 2006, we paid Yvonne Cole’s private consulting company management fees of $4,583 per month. As of May 1, 2006, we hired Ms. Cole as our Corporate Secretary. Ms. Cole’s employment with the Company terminated on August 24, 2006, and she was paid a severance payment of $4,583.

	5.	During the fiscal year ended April 30, 2007, we charged management fees of $40,000 to Target, a company of which several of our directors and officers serve as officers and directors. From May 1, 2007 to August 31, 2007, we received $20,000 in management fees from Target. Effective September 1, 2007, in lieu of management fees, we entered into a cost sharing arrangement with Target whereby we are reimbursed for an agreed percentage, currently 30%, of shared expenses such as rent, office and salaries of certain personnel. As of October 31, 2007, $38,089 was owed to us under this arrangement.

	6.	On August 1, 2007, we entered into the Consulting Agreement with Mr. Brett and his private consulting company, and agreed to pay $6,250 per month.

	7.	On February 12, 2007, we entered into an agreement with Target for the sale of our Sinbad claims for a cash payment in the amount of $31,698. We retained a 2% net smelter royalty.

	8.	Our directors and officers regularly incur expenses on our behalf for which they are reimbursed. As at April 30, 2007, we had outstanding expense reports from Gregory Davis as to $2,305.27, from J. Wayne Pickett as to $35.73 and from Mark J. Morabito as to $11,070.48.

	9.	During Fiscal 2006, we made an overpayment of management fees to Mark J. Morabito in the amount of $4,167. Mr. Morabito repaid this amount during Fiscal 2007.

Amounts payable to related parties have no specific terms of repayment, are unsecured, and have no interest rate.

The amounts charged to the Company for the services provided have been determined by negotiation among the parties and are covered by signed agreements.

These transactions were incurred in the normal course of operations and, in management’s opinion, were undertaken with the same terms and conditions as transactions with unrelated parties.

7.C. Interests of Experts and Counsel

Not applicable

ITEM 8. FINANCIAL INFORMATION

8.A. Consolidated Statements and Other Financial Information

Financial Statements

Our financial statements are stated in Canadian Dollars (CDN$) and are prepared in accordance with Canadian Generally Accepted Accounting Principles (GAAP), the application of which conforms in all material respects for the periods presented with United States GAAP, except as discussed in footnotes to the financial statements.

See our audited financial statements for the fiscal years ended April 30, 2007, April 30, 2006 and April 30, 2005 included under Item 17 of this annual report.

Dividend Policy

We have not declared or paid any cash dividends on our capital stock. We do not currently expect to pay cash dividends in the foreseeable future as we anticipate that all available funds will be invested to finance the growth of our business. The Board of Directors will determine if and when dividends should be declared and paid in the future based upon the Company’s financial position at the relevant time.

Legal/Arbitration Proceedings

There are no material, active or pending, legal or arbitration proceedings, including those relating to bankruptcy, receivership or similar proceedings and those involving any third party, which may have, or have had in the recent past, significant effects on our financial position or profitability. There are no legal proceedings to which the Company is a party, nor to the best of the knowledge of the Company’s management are any legal proceedings contemplated.

8.B. Significant Changes

Since April 30, 2007, the date of our most recent financial statements, the following significant changes have occurred:

Subsequent to April 30, 2007, we entered into an option agreement with Belmont Resources Inc. and International Montoro Resources Inc. to acquire a 75% interest in four mineral licenses totaling 139 claims located in the central mineral belt of Labrador, by carrying out $800,000 in exploration expenditures and issuing 175,000 common shares in the capital of the Company over a three year period. The agreement was approved by the TSX Venture Exchange on May 28, 2007.

PART II

ITEM 15. CONTROLS AND PROCEDURES

As of the end of the period covered by this report, we carried out an evaluation, under the supervision of our Chief Executive Officer and Chief Financial Officer, of the effectiveness of the design and operation of our “disclosure controls and procedures” pursuant to Exchange Act Rule 13a-15. Based upon that evaluation, our Chief Executive Officer and Chief Financial Officer concluded that our disclosure controls and procedures are effective to ensure that information required to be disclosed in the reports that we file or submit under the Exchange Act are recorded, processed, summarized and reported within the time periods specified in the U.S. Securities Exchange Commission rules and forms. In addition, our Chief Executive Officer and Chief Financial Officer concluded that our disclosure controls and procedures are effective to ensure that information required to be disclosed in the reports that we file or submit under the Exchange Act is accumulated and communicated to our management, including our Chief Executive Officer and Chief Financial Officer, so as to allow timely decisions regarding required disclosure.

Changes in Internal Control over Financial Reporting

There was no change in our internal control over financial reporting that occurred during our most recently completed fiscal year ended April 30, 2007 that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting. Nor were there any significant deficiencies or material weaknesses in our internal controls requiring corrective actions.

ITEM 16A. AUDIT COMMITTEE FINANCIAL EXPERT

The Board of Directors of the Company has determined that Ian Smith, a member of its audit committee, qualifies as an “audit committee financial expert” as defined in Item 16.A. of Form 20-F.

The Board of Directors of the Company has determined that Mr. Smith is an “independent” director in accordance with the definition set forth in Section 121 of the American Stock Exchange Company Guide.

PART III

ITEM 17. FINANCIAL STATEMENTS

Our financial statements are stated in Canadian Dollars and are prepared in accordance with Canadian Generally Accepted Accounting Principles (GAAP), the application of which, in our case, conforms in all material respects for the periods presented with United States GAAP, except as discussed in footnotes to the financial statements.

Auditors’ Report dated June 1, 2007

Balance Sheet at April 30, 2007, 2006 and 2005

Statement of Operations and Deficit for the years ended April 30, 2007, 2006 and 2005

Statement of Cash Flows for the years ended April 30, 2007, 2006 and 2005

Notes to the Financial Statements for the years ended April 30, 2007, 2006 and 2005

CROSSHAIR EXPLORATION & MINING CORP.

FINANCIAL STATEMENTS

(Expressed in Canadian Dollars)

APRIL 30, 2007

DAVIDSON & COMPANY LLP			A Partnership of Incorporated Professionals
DAVIDSON & COMPANY LLP		Chartered Accountants

INDEPENDENT AUDITORS’ REPORT

To the Shareholders of
Crosshair Exploration & Mining Corp.

We have audited the balance sheets of Crosshair Exploration & Mining Corp. as at April 30, 2007 and 2006 and the statements of operations, shareholders' equity and cash flows for the years ended April 30, 2007, 2006 and 2005. These financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on these financial statements based on our audits.

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

In our opinion, these financial statements present fairly, in all material respects, the financial position of the Company as at April 30, 2007 and 2006 and the results of its operations and cash flows for the years ended April 30, 2007, 2006 and 2005 in accordance with Canadian generally accepted accounting principles.

	"DAVIDSON & COMPANY LLP"

Vancouver, Canada	Chartered Accountants

June 1, 2007

	A Member of SC INTERNATIONAL

1200 - 609 Granville Street, P.O. Box 10372, Pacific Centre, Vancouver, BC, Canada, V7Y 1G6
Telephone (604) 687-0947 Fax (604) 687-6172

F-2

CROSSHAIR EXPLORATION & MINING CORP.
BALANCE SHEETS
AS AT APRIL 30
(Expressed in Canadian dollars)

		2007			2006

ASSETS

Current
Cash and cash equivalents	$	14,311,417		$	13,947,976
Marketable securities (Note 3)		1,787,387			-
Receivables		444,929			229,327
Due from related parties (Note 8)		-			4,167
Prepaid expenses		203,438			138,792

		16,747,171			14,320,262

Equipment (Note 4)		366,080			126,369
Mineral properties (Note 5)		14,551,292			3,919,761

	$	31,664,543		$	18,366,392

LIABILITIES AND SHAREHOLDERS' EQUITY

Current
Accounts payable and accrued liabilities	$	988,941		$	212,220
Due to related parties (Note 8)		19,241			14,221
Due to Paragon (formerly Rubicon) (Note 5a & e)		348,285			-

		1,356,467			226,441
Shareholders' equity
Capital stock (Note 6)
Authorized
Unlimited number of common shares without par value
Issued
70,912,072 (April 30, 2006 – 58,356,045) common shares		44,135,660			29,135,054
Contributed surplus (Note 6)		3,888,533			1,188,003
Deficit		(17,716,117	)		(12,183,106	)

		30,308,076			18,139,951

	$	31,664,543		$	18,366,392
Nature and continuance of operations (Note 1)
Subsequent events (Note 13)
Commitments and contingencies (Note 12)

On behalf of the Board:

“Mark Morabito”

Director

“Geir Liland”

Director

The accompanying notes are an integral part of these financial statements

F-3

CROSSHAIR EXPLORATION & MINING CORP.
STATEMENTS OF OPERATIONS
YEARS ENDED APRIL 30
(Expressed in Canadian dollars)

		2007			2006			2005


EXPENSES
Advertising	$	65,327		$	-		$	-
Amortization		43,882			7,477			745
Audit and accounting (Note 8)		38,604			143,212			83,536
Conference and exhibitions		99,448			-			-
Consulting		171,724			244,534			182,227
Directors fees (Note 8)		60,500			63,000			5,000
Insurance		35,897			-			-
Investor relations		143,773			130,364			120,880
Legal (Note 8)		212,486			100,700			79,300
Management fees (Note 8)		50,000			225,000			158,931
Office and administration		562,642			339,703			122,603
Property investigations		1,602			93,467			28,776
Rent		83,979			67,132			26,487
Stock-based compensation (Note 6)		3,696,601			682,213			316,521
Transfer agent and filing fees		87,017			106,448			58,292
Travel		306,978			165,538			60,623
Wages and salaries		923,743			41,441			-
		(6,584,203	)		(2,410,229	)		(1,243,921	)

OTHER ITEMS
Interest income		345,287			233,065			20,803
Management income (Note 8)		40,000			12,000			12,000
Realized gain - marketable securities		701,494			-			-
Unrealized loss – marketable securities		(35,589	)		-			-
Write-off of mineral properties (Note 5)		-			(1,518,429	)		(188,988	)
		1,051,192			(1,273,364	)		(156,185	)

Loss before income tax		(5,533,011	)		(3,683,593	)		(1,400,106	)

Future income tax recovery (Note 9)		-			1,508,120			754,720

Loss and comprehensive loss for the year		(5,533,011	)		(2,175,473	)		(645,386	)


Basic and diluted loss per common share	$	(0.09	)	$	(0.05	)	$	(0.03	)


Weighted average number of common shares outstanding		62,434,069			47,264,482			24,677,131

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

F-4

CROSSHAIR EXPLORATION & MINING CORP.
STATEMENTS OF CASH FLOWS
YEARS ENDED APRIL 30
(Expressed in Canadian dollars)

		2007			2006			2005

CASH FLOWS FROM OPERATING ACTIVITIES
Loss for the year	$	(5,533,011	)	$	(2,175,473	)	$	(645,386	)
Items not affecting cash:
Amortization		43,882			7,477			745
Stock-based compensation		3,696,601			682,213			316,521
Write-off of mineral properties		-			1,518,429			188,988
Future income taxes		-			(1,508,120	)		(754,720	)
Unrealized loss – marketable securities		35,589			-			-
Realized gain – marketable securities		(701,494	)

Purchase of marketable securities		(3,026,015	)		-			-
Proceeds from sales of marketable securities		1,904,533			-			-

Changes in non-cash working capital items:
Receivables		(215,602	)		(167,761	)		(41,086	)
Prepaid expenses		(64,646	)		(137,592	)		10,500
Accounts payable and accrued liabilities		52,531			(163,312	)		160,002
Due from related parties		4,167			3,210			(210	)
Due to related parties		5,020			(9,334	)		7,986

Net cash used in operating activities		(3,798,445	)		(1,950,263	)		(756,660	)

CASH FLOWS FROM INVESTING ACTIVITIES
Mineral properties		(8,480,906	)		(2,551,070	)		(1,510,334	)
Acquisition of equipment		(283,593	)		(132,108	)		-

Net cash used in investing activities		(8,764,499	)		(2,683,178	)		(1,510,334	)

CASH FLOWS FROM FINANCING ACTIVITIES
Issuance of shares for cash		12,926,385			14,395,916			6,818,624
Share issue costs		-			(561,206	)		(318,939	)

Net cash provided by financing activities		12,926,385			13,834,710			6,499,685

Net change in cash during the year		363,441			9,201,269			4,232,691

Cash and cash equivalents, beginning of year		13,947,976			4,746,707			514,016

Cash and cash equivalents, end of year	$	14,311,417		$	13,947,976		$	4,746,707

Cash and cash equivalents

Cash	$	28,402		$	3,947,976		$	615,707

Liquid short term investments		14,283,015			10,000,000			4,131,000

	$	14,311,417		$	13,947,976		$	4,746,707

Supplemental disclosures with respect to cash flows (Note 7)

The accompanying notes are an integral part of these financial statements

F-5

CROSSHAIR EXPLORATION & MINING CORP.
STATEMENT OF SHAREHOLDERS’ EQUITY
(Expressed in Canadian dollars)


	Number of								Contributed
	Shares			Price		Amount			Surplus		Deficit		Total

Balance at April 30, 2004	16,899,203				$	10,318,467		$	400,600		(9,362,247	)	1,356,820

Issued for:
Private placement (Note 6 (a))	4,080,000		$	0.25		1,020,000			-		-		1,020,000
Private placement (Note 6 (b))	1,525,000			0.25		381,250			-		-		381,250
Private placement (Note 6 (c))	2,750,000			0.40		1,100,000			-		-		1,100,000
Private placement (Note 6 (d))	1,000,000			0.30		300,000			-		-		300,000
Private placement (Note 6 (e))	5,622,220			0.45		2,529,999			-		-		2,529,999
Property acquisition (Note 6 (g))	940,000			0.20-0.60		245,000			-		-		245,000
Finder’s fee (Notes 6 (c & e))	383,367			0.40-0.45		162,890			-		-		162,890
Exercise of agent’s options and stock	397,600			0.15-0.25		174,035			-		-		174,035
options (Note 6 (h))
Exercise of broker’s warrants	1,133,150			0.25-0.35		415,730			-		-		415,730
(Note 6 (i))
Exercise of warrants (Note 6 (k))	2,974,000			0.30-0.35		1,039,900			-		-		1,039,900
Debt settlement (Note 6 (l))	60,000			0.17		10,200			-		-		10,200
Shares returned to treasury (Note 6 (j))	(154,000	)		0.25		(38,500	)		-		-		(38,500	)
Less: share issue costs	-			-		(504,942	)		-		-		(504,942	)

Fair value of warrants issued as finder’s	-			-		-			23,113		-		23,113
fee (Note 6 (a))
Stock-based compensation for the year	-			-		-			316,521		-		316,521
Less: fair market value of stock options,
agent’s options and broker’s warrants
exercised (Notes 6 (h & i))	-			-		-			(133,739	)	-		(133,739	)
Tax benefit renounced to flow-though
share subscribers	-			-		(754,720	)		-		-		(754,720	)
Loss for the year	-			-		-			-		(645,386	)	(645,386	)

Balance at April 30, 2005	37,610,540					16,399,309			606,495		(10,007,633	)	6,998,171

Issued for:
Private placement (Note 6 (f))	12,977,500			0.80-1.00		11,182,000			-		-		11,182,000
Finder’s fee (Note 6 (f))	402,741			0.80		322,193			-		-		322,193
Less: Share issue costs (Note 6 (f))	-			-		(1,536,806	)		-		-		(1,536,806	)
Property acquisition (Note 6 (p))	400,000			0.76-0.90		317,000			-		-		317,000
Exercise of agent’s options and stock	2,363,874			0.25-0.85		1,886,491			-		-		1,886,491
options (Note 6 (m))
Exercise of agent’s warrants (Note 6 (n))	438,418			0.50-0.75		280,688			-		-		280,688
Exercise of warrants (Note 6 (o))	4,162,972			0.30-1.25		1,792,299			-		-		1,792,299
Stock-based compensation for the year	-			-		-			1,335,620		-		1,335,620
Less: fair market value of stock options	-			-		-			(754,112	)	-		(754,112	)
exercised (Note 6 (m))
Tax benefit renounced to flow-through share	-			-		(1,508,120	)		-		-		(1,508,120	)
subscribers
Loss for the year	-			-		-			-		(2,175,473	)	(2,175,473	)

F-6

CROSSHAIR EXPLORATION & MINING CORP.
STATEMENT OF SHAREHOLDERS’ EQUITY
(Expressed in Canadian dollars)


	Number of					Contributed
	Shares	Price		Amount		Surplus			Deficit			Total

Continued…

Balance at April 30, 2006	58,356,045	-	$	29,135,054	$	1,188,003		$	(12,183,106	)	$	18,139,951

Issued for:
Property acquisition (Note 6 (t))	445,000	1.27-3.29		1,078,150		-			-			1,078,150
Exercise of agent’s options and stock options	2,672,764	0.23-1.32		2,400,146		-			-			2,400,146
(Note 6 (r))
Exercise of agent’s warrants (Note 6 (r))	273,863	0.75-1.25		277,571		-			-			277,571
Exercise of warrants (Note 6 (r))	8,674,025	0.75-1.75		10,537,395		-			-			10,537,395
Shares issued under incentive program (Note	490,375	1.25-1.75		707,343								707,343
6 s)
Stock-based compensation for the year	-	-		-		3,696,601			-			3,696,601
Less: value of stock options exercised (Note 6 (q))	-	-		-		(996,071	)		-			(996,071	)

Loss for the year	-	-		-		-			(5,533,011	)		(5,533,011	)

Balance at April 30, 2007	70,912,072	-	$	44,135,660	$	3,888,533		$	(17,716,117	)	$	30,308,076

F-7

CROSSHAIR EXPLORATION & MINING CORP.

NOTES TO THE FINANCIAL STATEMENTS

April 30, 2007

(Expressed in Canadian dollars)

1.	NATURE AND CONTINUANCE OF OPERATIONS

	Crosshair Exploration & Mining Corp. (the "Company") was incorporated under the laws of British Columbia on September 2, 1966. Its principal business activities are the exploration and development of resource properties. All of the Company’s resource properties are located in North America.

	The Company is in the process of acquiring, exploring and developing its resource properties and has not yet determined whether the properties contain ore reserves that are economically recoverable. The recoverability of the amounts shown for resource properties and related deferred exploration costs are dependent upon the existence of economically recoverable reserves, the ability of the Company to obtain necessary financing to complete the development of those reserves and upon future profitable production.

	These financial statements have been prepared on a going concern basis, which contemplates the realization of assets and liquidation of liabilities during the normal course of business as they come due.

	At April 30, 2007, the company has working capital of $15,390,704 and has remaining commitments to spend approximately $1,036,000 on its mineral properties before April 30, 2008. The funds required to continue operations and exploration activities during this period have been financed primarily from the issue of equity. Management believes that the successful financings over the last three years have mitigated the adverse conditions which raised substantial doubt on the Company's going concern.

	Management estimates that these funds will be sufficient to meet the company's obligations and capital expenditure plans for the coming year. The company's ability to continue as a going concern, and the recoverability of its mineral properties and equipment, is dependent on its ability to fund its exploration programs and reach profitable operations. These financial statements do not reflect the adjustments to carrying values of assets and liabilities and the reported expenses and balance sheet classifications that would be necessary should the going concern assumption be inappropriate, and these adjustments could be material.

	All amounts are in Canadian dollars unless otherwise stated.

2.	SIGNIFICANT ACCOUNTING POLICIES

	Financial Instruments - Changes in Accounting Policies

	Effective May 1, 2006, the Company decided to early adopt the following new accounting standards issued by the Canadian Institute of Chartered Accountants (CICA) relating to financial instruments. These new standards have been adopted on a prospective basis with no restatement to prior period financial statements.

	Financial Instruments-Recognition and Measurement (Section 3855)

	These standards set out criteria for the recognition and measurement of financial instruments for fiscal years beginning on or after October 1, 2006. This standard requires all financial instruments within its scope, including derivatives, to be included on a Company’s balance sheet and measured either at fair value or, in certain circumstances when fair value may not be considered most relevant, at cost or amortized cost. Changes in fair value are to be recognized in the statements of operations and comprehensive income.

	All financial assets and liabilities are recognized when the entity becomes a party to the contract creating the item. As such, any of the Company’s outstanding financial assets and liabilities at the effective date of adoption are recognized and measured in accordance with the new requirements as if these requirements had always been in effect. Any changes to the fair values of assets and liabilities prior to February 1, 2007, are recognized by adjusting opening deficit or opening accumulated other comprehensive income.

F-8

CROSSHAIR EXPLORATION & MINING CORP.

NOTES TO THE FINANCIAL STATEMENTS

April 30, 2007

(Expressed in Canadian dollars)

2.	SIGNIFICANT ACCOUNTING POLICIES (cont’d…)

	All financial instruments are classified into one of the following five categories: held for trading, held-to-maturity, loans and receivables, available-for-sale financial assets, or other financial liabilities. Initial and subsequent measurement and recognition of changes in the value of financial instruments depend on their initial classification:

	• Held for trading financial instruments are measured at fair value. All gains and losses are included in net earnings in the period in which they arise.
	• Held-to-maturity investments, loans and receivables, and other financial liabilities are initially measured at fair value and subsequently measured at amortized cost. Amortization of premiums or discounts and losses due to impairment are included in current period net earnings.
	• Available-for-sale financial assets are measured at fair value. Revaluation gains and losses are included in other comprehensive income until the asset is removed from the balance sheet.
	• All derivative financial instruments are classified as held for trading financial instruments and are measured at fair value, even when they are part of a hedging relationship. All gains and losses are included in net earnings in the period in which they arise.

	In accordance with this new standard, the Company has classified its financial instruments as follows:

	Cash and cash equivalents, and marketable securities are classified as held-for-trading; receivables are classified as loans and accounts payable are classified as other financial liabilities. All are measured at fair value and gains and losses are included in net earnings in the period in which they arise. Cash and cash equivalents are exposed to credit risk and these amounts are placed with major Canadian banks. The Company is not exposed to interest rate risk due to the short term maturity of the financial instruments.

	Hedging (Section 3865)

	This new standard specifies the circumstances under which hedge accounting is permissible and how hedge accounting may be performed. The Company currently does not have any hedges.

	Comprehensive Income (Section 1530)

	Comprehensive income is the change in shareholders’ equity during a period from transactions and other events from non-owner sources. This standard requires certain gains and losses that would otherwise be recorded as part of net earnings to be presented in other “comprehensive income” until it is considered appropriate to recognize into net earnings. This standard requires the presentation of comprehensive income, and its components in a separate financial statement that is displayed with the same prominence as the other financial statements.

	There was no effect on opening equity as of May 1, 2006, as a result of applying these new standards.

	Accounting Changes (Section 1506)

	This standard allows for voluntary changes in accounting policy only when such changes enhance the relevance and reliability of the financial statements, and the comparability of those financial statements over time and with the financial statements of other entities. The standard requires changes in accounting policy to be applied retrospectively unless doing so is impracticable, requires prior period errors to be corrected retrospectively and calls for enhanced disclosures about the effects of changes in accounting policies, estimates and errors on the financial statements.

	Any impact that the adoption of Section 1506 will have on the Company’s results of operations and financial condition will depend on the nature of future accounting changes. Its adoption has had no impact on these financial statements.

F-9

CROSSHAIR EXPLORATION & MINING CORP.

NOTES TO THE FINANCIAL STATEMENTS

April 30, 2007

(Expressed in Canadian dollars)

2.	SIGNIFICANT ACCOUNTING POLICIES (cont’d…)

	Use of estimates

	The preparation of financial statements in conformity with Canadian generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amount of assets and liabilities and the disclosure of contingent assets and liabilities at the date of the financial statements and the reported amount of revenues and expenses during the period. Actual results could differ from these estimates.

	Cash and cash equivalents

	The Company considers cash and cash equivalents to include cash on deposit and highly liquid short-term interest bearing variable rate investments. Interest earned is recognized immediately in operations.

	Marketable securities

	The Company accounts for its marketable securities at fair market value with gains and losses included in the statement of operations.

	Receivables

	Receivables are reported at face value less any provisions for uncollectible accounts considered necessary.

	Equipment

	Equipment is recorded at cost. The equipment noted below is amortized over its useful lives using the following annual rates and methods:

Computer hardware	30%	Declining balance
Computer software	45%	Declining balance
Exploration equipment	20%	Declining balance
Furniture and fixtures	20%	Declining balance
Office equipment	30%	Declining balance

Mineral properties

Any option payments received by the Company from third parties or tax credits refundable by the Government of Newfoundland are credited to the capitalized cost of the mineral property. If payments received exceed the capitalized cost of the mineral property, the excess is recognized as income in the year received.

The amounts shown for mineral properties do not necessarily represent present or future values. Their recoverability is dependent upon the discovery of economically recoverable reserves, the ability of the Company to obtain the necessary financing to complete the development, and future profitable production or proceeds from the disposition thereof.

F-10

CROSSHAIR EXPLORATION & MINING CORP.

NOTES TO THE FINANCIAL STATEMENTS

April 30, 2007

(Expressed in Canadian dollars)

2.	SIGNIFICANT ACCOUNTING POLICIES (cont’d…)

	Asset retirement obligations

	The Company recognizes the fair value of a liability for an asset retirement obligation in the year in which it is incurred when a reasonable estimate of fair value can be made. The carrying amount of the related long-lived asset is increased by the same amount as the liability. The Company does not have any significant asset retirement obligations.

	Flow-through shares

	Canadian tax legislation permits a company to issue flow-through shares whereby the deduction for tax purposes relating to qualified resource expenditures is claimed by the investors rather than the Company. Recording these expenditures for accounting purposes gives rise to taxable temporary differences.

	Effective March 19, 2004, the Emerging Issues Committee of the Canadian Institute of Chartered Accountants requires, where it is more likely than not, that when flow-through expenditures are renounced, a portion of the future income tax assets that were not recognized in previous years, due to the recording of a valuation allowance, be recognized as recovery of income taxes in the statement of operations.

	Loss per share

	Basic loss per share is computed by dividing the loss for the period by the weighted average number of common shares outstanding during the period.

	For diluted per share computations, assumptions are made regarding potential common shares outstanding during the period. The weighted average number of common shares is increased to include the number of additional common shares that would be outstanding if, at the beginning of the period, or at time of issuance, if later, all options and warrants are exercised. Proceeds from exercise are used to purchase the Company’s common shares at their average market price during the period, thereby reducing the weighted average number of common shares outstanding. If these computations prove to be anti-dilutive, diluted loss per share is the same as basic loss per share.

	Stock-based compensation

	The Company has an employee stock option plan. The Company recognizes an expense arising from stock options granted to both employees and non-employees using the fair value method. The fair value of option grants is generally established at the date of grant using the Black Scholes option pricing model and the compensation amount, equal to the option’s fair value, is then recognized over the options vesting periods.

	Income taxes

	Income taxes are accounted for using the asset and liability method. Under this method of tax allocation, future tax assets and liabilities are determined based on differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases (“temporary differences”) and losses carried forward. Future income tax assets and liabilities are measured using the enacted tax rates expected to be in effect when the temporary differences are likely to reverse. The effect on future tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the date of enactment or substantive enactment. The amount of future income tax assets recognized is limited to the amount that is more likely than not to be realized.

F-11

CROSSHAIR EXPLORATION & MINING CORP.

NOTES TO THE FINANCIAL STATEMENTS

April 30, 2007

(Expressed in Canadian dollars)

3.	MARKETABLE SECURITIES


	April 30, 2007				April 30, 2006

	Fair Market Value		Cost		Fair Market Value		Cost

$	1,787,387	$	1,822,976	$	-	$	-

4.	PROPERTY, PLANT AND EQUIPMENT

		April 30, 2007						April 30, 2006

				Accumulated		Net				Accumulated		Net
		Cost		Amortization		Book Value		Cost		Amortization		Book Value

Furniture and fixtures	$	75,112	$	14,625	$	60,487	$	60,514	$	1,990	$	58,524
Computer hardware / office equipment		67,014		13,843		53,171		16,202		5,688		10,514
Computer software		32,936		5,581		27,355		-		-		-
Exploration equipment		247,162		22,095		225,067		61,915		4,584		57,331

	$	422,224	$	56,144	$	366,080	$	138,631	$	12,262	$	126,369

F-12

CROSSHAIR EXPLORATION & MINING CORP.

NOTES TO THE FINANCIAL STATEMENTS

April 30, 2007

(Expressed in Canadian dollars)

5.	MINERAL PROPERTIES

		Central Mineral Belt Project
											Southern
		Golden					Otter / Portage				Golden			Glenwood			Wings			Beigou
		Promise		Moran Lake			Lake		Sinbad		Promise			Break			Point -Titan			Gold			Other
		Property		Property			Properties		claims		(Victoria Lake)			Property			Property			Property			Properties			Total
Balance at April 30, 2005
	$	-	$	598,500		$	-	$	-	$	536,289		$	785,163		$	392,409		$	171,444		$	-		$	2,483,805
		-
Drilling and trenching		-		323,008			-		-		37,929			32,349			-			-			55,046			448,332
Geology		-		541,753			400		8,597		145,301			73,089			10,872			41,410			7,504			828,926
Geophysics		-		1,085,376			-		-		98,112			3,562			-			-			-			1,187,050
Administration		-		152,555			-		-		36,148			4,188			2,463			17,081			561			212,996
Technical analysis		-		87,725			-		-		110,393			22,438			104			-			664			221,324
Acquisition costs		-		290,000			70,000		4,125		82,000			-			-			-			-			446,125
Credits received		-		(266,300	)		-		-		(22,150	)		(36,693	)		(31,326	)		-			(33,899	)		(390,368	)

Total expenditures for the year		-		2,214,117			70,400		12,722		487,733			98,933			(17,887	)		58,491			29,876			2,954,385

Write-off of mineral properties		-		-			-		-		-			(884,096	)		(374,522	)		(229,935	)		(29,876	)		(1,518,429	)

Balance at April 30, 2006	$	-	$	2,812,617		$	70,400	$	12,722	$	1,024,022		$	-		$	-		$	-		$	-		$	3,919,761
Drilling and trenching		640,629		2,474,435			94,698		-		514,059			-			-			-			-			3,723,821
Geology		32,738		2,070,123			34,741		3,127		78,338			-			-			-			-			2,219,067
Geophysics		-		2,278,608			62,900		-		79,961			-			-			-			-			2,421,469
Administration		54,301		343,171			7,765		-		42,743			-			-			-			-			447,980
Technical analysis		17,336		432,758			8,261		-		40,189			-			-			-			-			498,544
Acquisition costs		110,400		710,000			276,750		-		223,500			-			-			-			-			1,320,650
Credits received		-		-			-		-		-			-			-			-			-			-

Total expenditures for the year		855,404		8,309,095			485,115		3,127		978,790			-			-			-			-			10,631,531

Balance at April 30, 2007	$	855,404	$	11,121,712		$	555,515	$	15,849	$	2,002,812		$	-		$	-		$	-		$	-		$	14,551,292

F-13

CROSSHAIR EXPLORATION & MINING CORP.

NOTES TO THE FINANCIAL STATEMENTS

April 30, 2007

(Expressed in Canadian dollars)

5.	MINERAL PROPERTIES (cont’d…)

Cumulative totals as at April 30, 2007:

		Central Mineral Belt Project
											Southern
		Golden					Otter / Portage				Golden			Glenwood			Wings			Beigou
		Promise		Moran Lake			Lake		Sinbad		Promise			Break			Point -Titan			Gold			Other
		Property		Property			Property		claims		(Victoria Lake)			Property			Property			Property			Properties			Total

Drilling and trenching	$	640,629	$	2,797,441		$	94,698	$	-	$	565,064		$	84,061		$	126,550		$	-		$	57,054		$	4,365,497
Geology		32,738		2,805,121			35,141		11,724		448,585			350,739			144,147			105,883			49,833			3,983,911
Geophysics		-		3,447,121			62,900		-		325,368			272,920			5,118			-			11,154			4,124,581
Administration		54,301		515,927			7,765		-		104,400			54,694			35,842			40,386			5,224			818,539
Technical analysis		17,336		562,402			8,261		-		226,045			108,375			34,831			304			22,396			979,950
Acquisition costs		110,400		1,260,000			346,750		4,125		355,500			50,000			59,360			83,362			107,102			2,376,599
Credits received		-		(266,300	)		-		-		(22,150	)		(36,693	)		(31,326	)		-			(33,899	)		(390,368	)
Write-off of mineral properties		-		-			-		-		-			(884,096	)		(374,522	)		(229,935	)		(218,864	)		(1,707,417	)

Balance at April 30, 2007	$	855,404	$	11,121,712		$	555,515	$	15,849	$	2,002,812		$	-		$	-		$	-		$	-		$	14,551,292

F-14

CROSSHAIR EXPLORATION & MINING CORP.

NOTES TO THE FINANCIAL STATEMENTS

April 30, 2007

(Expressed in Canadian dollars)

5.	MINERAL PROPERTIES (cont’d…)

a) GOLDEN PROMISE PROJECT

On May 2, 2006, the Company entered into an option agreement with Paragon Minerals Corporation (“Paragon”) (formerly Rubicon Minerals Corporation) to earn a 60% interest in the Golden Promise Property. The option agreement calls for:

Issuing common shares:

	Number of shares
Within 5 days of the execution date of the agreement	20,000	Issued by the Company
On or before May 1, 2007	20,000	Issued by the Company
On or before May 1, 2008	20,000
On or before May 1, 2009	20,000
	80,000

ii)

Incurring a total of $4,000,000 in exploration expenditures:

		Amount
On or before May 1, 2007 (as a firm and binding commitment)	$	750,000¹
On or before May 1, 2008		900,000
On or before May 1, 2009		1,100,000
On or before May 1, 2010		1,250,000
	$	4,000,000

¹As at April 30, 2007, the Company incurred $745,004 in exploration expenditures, paid $85,000 in cash, and issued 20,000 common shares at a value of $25,400 for acquisition costs.

iii)

Make cash payments on behalf of Paragon for Paragon’s obligations with respect to the Golden Promise Property and other claims as follows:

		Amount
On or before June 1, 2006	$	75,000	Paid by Paragon
On or before June 14, 2006		10,000	Paid by the Company
On or before June 14, 2007		15,000
	$	100,000

During the year ended April 30, 2007, the Company advanced $587,000 to Paragon for Golden Promise exploration costs and at April 30, 2007, Paragon had spent $742,803. As a result the Company owes Paragon $155,803.

b) MORAN LAKE PROPERTY (PART OF CENTRAL MINERAL BELT PROJECT)

On October 14, 2004, the Company entered into an agreement with a private individual for an option to acquire a 90% interest (subject to a 2% NSR and a 10% carried interest to the vendor) in the Moran Lake Property in Central Labrador. On March 1, 2005, the Company acquired another 381 claims north of the Moran Lake Property, known as Moran Heights.

F-15

CROSSHAIR EXPLORATION & MINING CORP.

NOTES TO THE FINANCIAL STATEMENTS

April 30, 2007

(Expressed in Canadian dollars)

5.	MINERAL PROPERTIES (cont’d…) The amended and restated agreement calls for:

Making cash payments:

		Amount
Upon execution of the agreement (original)	$	25,000	(Paid October 2004)
Within 5 business days of the approval date (original agreement)		50,000	(Paid November 2004)
Upon signing of the amended and restated agreement		25,000	(Paid March 2005)
On or before November 10, 2005		100,000	(Paid November 2005)
On or before November 10, 2006		100,000	(Paid November 2006)
On or before November 10, 2007		125,000
On or before November 10, 2008		150,000
	$	575,000

ii)

Issuing common shares:

	Number of shares
Upon execution of the agreement (original)	250,000	(Issued October 2004)
Upon acceptance by the TSX Venture Exchange (amended agreement)	100,000	(Issued March 2005)
	100,000	(Issued March 2005)
Upon the approval date of the original agreement	250,000	(Issued December 2004)
Second year share payment	250,000	(Issued October 2005)
Third year share payment	250,000	(Issued November 2006)
Fourth year share payment	250,000
Fifth year share payment	250,000
	1,600,000

iii)

Incurring a total of $3,000,000 in exploration expenditures:

		Amount
On or before November 10, 2005	$	100,000	(Requirement met)
On or before November 10, 2006		300,000	(Requirement met)
On or before November 10, 2007		500,000	(Requirement met)
On or before November 10, 2008		800,000	(Requirement met)
On or before November 10, 2009		1,300,000	(Requirement met)
	$	3,000,000

The agreement requires completion of a bankable feasibility study for the commencement of commercial production on the property within 24 months of completion of all aforementioned obligations.

F-16

CROSSHAIR EXPLORATION & MINING CORP.

NOTES TO THE FINANCIAL STATEMENTS

April 30, 2007

(Expressed in Canadian dollars)

5.	MINERAL PROPERTIES (cont’d…)

c) OTTER / PORTAGE LAKE PROPERTY (PART OF CENTRAL MINERAL BELT PROJECT)

On December 2, 2005 the Company entered into an agreement with a private company for an option to acquire a 100% interest (subject to a 1.5% NSR) in the Otter and Portage Lake Properties. The option agreement calls for:

Making cash payments:

		Amount
Upon execution of the agreement	$	25,000	(Paid in December 2005)
On or before December 2, 2006		30,000	(Paid in December 2006)
On or before December 2, 2007		35,000
On or before December 2, 2008		50,000
	$	140,000

ii)

Issuing common shares:

	Number of shares
Upon acceptance by the TSX Venture Exchange	50,000	(Issued in January 2006)
On or before December 2, 2006	75,000	(Issued in December 2006)
On or before December 2, 2007	100,000
	225,000

iii)

Incurring a total of $600,000 in exploration expenditures:

		Amount
On or before December 2, 2006	$	100,000	(Requirement met)
On or before December 2, 2007 an additional		200,000
On or before December 2, 2008 an additional		300,000
	$	600,000

As at April 30, 2007, the Company incurred $208,765 in exploration expenditures, paid $55,000 in cash, and issued 125,000 common shares at a value of $291,750 for acquisition costs.

d) SINBAD CLAIMS

The Sinbad claims, located in Emery County, Utah, were transferred to the Company on January 17, 2006 for $4,125 and $11,724 was incurred in relation to geological work. The Company has recently entered into an agreement with Target Exploration & Mining Corp. (a related party by way of common directors with the Company) for the sale of the Sinbad claims for a cash payment in the amount of $31,698. The Company will retain a 2% net smelter royalty. Subsequent to April 30, 2007, this agreement was approved by the TSX Venture Exchange.

F-17

CROSSHAIR EXPLORATION & MINING CORP.

NOTES TO THE FINANCIAL STATEMENTS

April 30, 2007

(Expressed in Canadian dollars)

5.	MINERAL PROPERTIES (cont’d…)

e) SOUTHERN GOLDEN PROMISE (VICTORIA LAKE), WINGS POINT – TITAN, GLENWOOD BREAK PROPERTIES

During February 2003, the Company entered into three separate option-JV agreements with Paragon Minerals Corporation (“Paragon”) (formerly Rubicon Minerals Corporation) to acquire a 60% interest in mineral claims located in the Botwood Basin area of Central Newfoundland covering three separate land packages known as Southern Golden Promise, Wings Point – Titan, and Glenwood Break. The Company was able to earn its 60% interest in the properties by issuing up to 400,000 shares for each property and incurring $5,250,000 in exploration, both spread over a four year period with each period ending September 30, with a minimum $750,000 during the first year, $1,200,000 during the second year, and the remainder over the third and fourth years; with 60% of the expenditures to target on diamond drilling.

On September 7 and September 22, 2005, the Company elected to terminate its options on the Wings Point-Titan property and the Glenwood Break property, respectively, and returned the properties to Paragon Minerals Corporation. As a result, the Company has no further obligations and the related mineral properties costs of $1,258,618 were written-off in the second quarter of 2006.

During the year ended April 30, 2007, the company advanced $370,000 to Paragon for Southern Golden Promise exploration costs and at April 30, 2007, Rubicon had spent $562,482 on behalf of the Company. As a result the Company owes Paragon $192,482.

f) BEIGOU GOLD PROPERTY

On September 16, 2004 the Company announced that it had entered into a letter of intent with the Liaoning Non-ferrous Geological Bureau (the “Bureau”) in China for a formal joint venture of the Beigou Gold Project. On December 2, 2004, the Company announced the completion of a formal joint venture agreement with the Bureau following completion of a NI 43-101 report on the Beigou Gold project. The original agreement was amended and restated on April 18, 2005. The Company can earn up to a 80% interest in the Property by making exploration expenditures in the aggregate amount of US$3,500,000 and making cash payments to the Bureau in the amount of US$500,000, all over a five year period. A finder's fee of US$100,000, 1,000,000 common shares, and a 1% NSR, was to be paid to a third party over the five year period as the Company makes the exploration expenditures in the joint venture agreement. As at January 31, 2006, the Company incurred $146,573 in exploration expenditures and paid $18,758 of finder’s fees and $64,604 of legal fees related to the acquisition of the Beigou Gold Project.

g) OTHER PROPERTIES WRITTEN-OFF

NORTH PAUL’S POND GOLD PROPERTY

During June 2003, the Company entered into an agreement with a private individual for an option to acquire a 100% interest in the North Paul’s Pond Gold Property in North-Central Newfoundland. On June 22, 2005, the Company terminated its option on the North Paul’s Pond Gold property and as a result has no further obligations. The related costs of $109,878 were written-off in the year ended April 30, 2005 and an additional $63,775 was written-off in the first quarter of 2006.

F-18

CROSSHAIR EXPLORATION & MINING CORP.

NOTES TO THE FINANCIAL STATEMENTS

April 30, 2007

(Expressed in Canadian dollars)

5.	MINERAL PROPERTIES (cont’d…)

	NORTH PAUL’S POND GOLD PROPERTY (cont’d….)

	$33,899 was received for the North Paul’s Pond property in the third quarter of 2006. This was from the Newfoundland Government in regards to the mineral incentive program. As a result the amount of $173,653 originally written off was decreased to $139,754.

	DJ Gold Property

	During January 2004, the Company entered into an agreement to acquire up to 100% of the DJ Gold Property in the Shaanxi Province of China from Dinjialing Gold Corporation Limited. During the year ended April 30, 2005, the Company elected to terminate this option along with its obligations and related mineral property costs of $79,110 were written-off.

6.	CAPITAL STOCK AND CONTRIBUTED SURPLUS

	Share issuances

	The authorized share capital of the Company is an unlimited number of common shares without par value.

	(a)	On May 31, 2004, the Company completed a private placement of 4,080,000 flow-through shares at a price of $0.25 per share for proceeds of $1,020,000. The agent received an 8% commission of the gross proceeds along with 326,400 broker’s warrants exercisable into common shares of the Company at $0.25 per share for a period of 12 months ($23,113 representing the fair value of these warrants was added to contributed surplus). The agent’s warrants were fully exercised during the year ended April 30, 2005. Share issue costs of $138,896 were incurred in relation to this private placement.

	(b)	On November 27, 2004, the Company completed a private placement of 1,525,000 units at a price of $0.25 per unit for aggregate gross proceeds of $381,250. Each unit is comprised of one common share and one non- transferable share purchase warrant. The warrant entitles the holder to acquire one common share of the Company at a price of $0.30 per share until November 27, 2005. The warrants contain a forced exercise provision. In the event that the closing price of the Company’s listed shares exceeds $0.60 per common share for 10 consecutive trading days after the four month hold period, the exercise period of the warrants could be shortened to a period of 30 days from the date that the Company provides written notice to the holders of the warrants of such an early expiry. During the year ended April 30, 2006, all the warrants associated with this private placement were exercised (Notes 5 (k & o)). Share issue costs of $1,410 were incurred in relation to this private placement.

	(c)	On December 14, 2004, the Company completed a non-brokered private placement of 2,750,000 units at a price of $0.40 per unit for aggregate gross proceed of $1,100,000. Each unit is comprised of one flow-through common share of the Company and one half of one non-transferable share purchase warrant. Each whole warrant entitles the holder to purchase one common share of the Company at a price of $0.50 per share until December 14, 2005. The Company paid a finder’s fee equal to 7% of the aggregate gross proceeds raised from the private placement totaling 192,500 units. Each finder’s fee unit includes one common share and one share purchase warrant. Share issue costs of $81,385 were incurred in relation to this private placement. During the year ended April 30, 2006, all the warrants associated with this private placement were exercised (Notes 6 (n & o)).

F-19

CROSSHAIR EXPLORATION & MINING CORP.

NOTES TO THE FINANCIAL STATEMENTS

April 30, 2007

(Expressed in Canadian dollars)

6.	CAPITAL STOCK AND CONTRIBUTED SURPLUS

	Share issuances (cont’d…)

	(d)	On January 11, 2005, the Company completed a private placement of 1,000,000 units at a price of $0.30 per unit for aggregate gross proceeds of $300,000. Each unit is comprised of one common share and one non- transferable share purchase warrant. The warrant entitles the holder to acquire one common share of the Company at a price of $0.40 per share until January 11, 2006. The warrants contain a forced exercise provision. In the event that the closing price of the Company’s listed shares exceeds $0.60 per common share for 10 consecutive trading days after the four month hold period, the exercise period of the warrants will be shortened to a period of 30 days from the date that the Company provides written notice to the holders of the warrants of such an early expiry. Share issue costs of $2,240 were incurred in relation to this private placement. During the year ended April 30, 2006, all the warrants associated with this private placement were exercised (Note 6 (o)).

	(e)	On March 15, 2005, the Company completed a private placement of 5,622,220 units at a price of $0.45 per unit for aggregate gross proceed of $2,529,999. Each unit is comprised of one common share and one half of one transferable share purchase warrant. The Agent was also issued 562,222 compensation options equal to 10% of the number of units sold. Each whole warrant entitles the holder to acquire one common share of the Company at a price of $0.75 per share until March 15, 2007. The Company paid a commission equal to 7% of the aggregate gross proceeds raised from the private placement totaling $177,100, of which $91,210 was taken in cash and the remainder of $85,890 in 190,867 units with the same terms. Each compensation option entitles the agent to acquire one unit of the Company at a price of $0.50 per unit for a period of two years. Share issue costs of $273,561 were incurred in relation to this private placement. As of April 30, 2007, all of the warrants associated with this private placement were exercised (Note 6 (n & o)).

	(f)	On November 3, 2005, the Company completed a brokered private placement, which consisted of 4,000,000 flow-through units (the “FT Units”) at a price of $1.00 per FT Unit for aggregate proceeds of $4,000,000 and 8,977,500 non-flow-through units (the “Common Share Units”) at a price of $0.80 per Common Share Unit for aggregate proceeds of $7,182,000. Each FT Unit was comprised of one flow-through common share and one- half of one transferable non-flow through share purchase warrant. Each whole warrant entitles the holder to purchase one common share of the Company at a price of $1.75 per share until November 3, 2007. Each Common Share Unit is composed of one-non flow-through common share and one half of one transferable non-flow through share purchase warrant. Each whole warrant entitles the holder to purchase one common share of the Company at a price of $1.25 per share until November 3, 2007. The Agent was paid a commission of 7% of the gross proceeds of the placement, $460,547 of which was taken in cash and $322,193 in 402,741 Common Share Units. The Agent was also issued 1,297,750 compensation options (valued at $653,407) equal to 10% of the number of units sold. Each compensation option entitles the Agent to acquire one Common Share Unit of the Company at an exercise price of $0.85 for a period of two years. All securities issued pursuant to this offering are subject to a four-month hold period commencing November 3, 2005. Share issue costs of $1,536,806 were incurred in relation to this private placement. As of April 30, 2007, 6,126,250 of the regular warrants, 163,987 of the agent’s warrants and 1,105,766 agent’s options were exercised (Note 6 (o)).

	(g)	During the year ended April 30, 2005, 40,000 common shares valued at $0.25 per share were issued for acquisition costs associated with the North Paul’s Pond property; 300,000 common shares valued at $0.25 per share were issued for acquisition costs associated with the Company’s Glenwood Break property; and 500,000 common shares valued at $0.20 per share and 100,000 common shares valued at $0.60 per share were issued for acquisition costs associated with the Moran Lake property.

	(h)	During the year ended April 30, 2005, 148,850 agent’s options and 198,750 stock options granted to directors and consultants of the Company at a price of $0.25 per share, and 50,000 stock options granted to a consultant of the Company at a price of $0.15 per share were exercised into common shares of the Company for gross proceeds of $94,400 ($79,635, representing the fair market value of the options exercised was allocated to capital stock).

F-20

CROSSHAIR EXPLORATION & MINING CORP.

NOTES TO THE FINANCIAL STATEMENTS

April 30, 2007

(Expressed in Canadian dollars)

6.	CAPITAL STOCK AND CONTRIBUTED SURPLUS Share issuances (cont’d…)

	(i)	During the year ended April 30, 2005, 760,000 broker’s warrants were exercised at $0.35 per share, 46,750 broker’s warrants were exercised at $0.30 per share, and 326,400 broker’s warrants were exercised at $0.25 per share for total gross proceeds of $361,625 ($54,104, representing the fair market value of the broker warrants exercised was allocated to capital stock).

	(j)	On July 31, 2004, 154,000 common shares issued at a price of $0.25 per share to a consultant in fiscal 2004 were cancelled and returned to the treasury as a result of the termination of the agreement with the consultant.

	(k)	During the year ended April 30, 2005, 2,954,000 warrants were exercised at $0.35 per share and 20,000 warrants were exercised at $0.30 per share for total gross proceeds of $1,039,900.

	(l)	On February 10, 2005, the Company settled debt of $10,200 by the issuance of 60,000 common shares at a price of $0.17 per share to an officer of the Company.

	(m)	During the year ended April 30, 2006, 151,150 agent’s options and 1,027,500 stock options at a price of $0.25 per share, 50,000 stock options at a price of $0.28 per share, 346,356 agent’s options at a price of $0.50, 738,868 agent’s options at a price of $0.85, and 50,000 stock options at a price of $0.45 were all exercised for total gross proceeds of $1,132,379 ($754,112 representing the fair market value of the stock options, agent’s options, and broker’s warrants exercised was allocated to capital stock).

	(n)	During the year ended April 30, 2006, 245,918 agent’s warrants at a price of $0.75 were exercised into common shares of the Company for gross proceeds of $184,439 and 192,500 agent’s warrants at a price of $0.50 per share were exercised into common shares of the Company for gross proceeds of $96,250.

	(o)	During the year ended April 30, 2006, 1,505,000 warrants at $0.30 per share, 1,000,000 warrants at $0.40 per share, 1,375,000 warrants at a price of $0.50 per share, 200,833 warrants at a price of $0.75 per share, and 82,139 warrants at a price of $1.25 per share were exercised for total gross proceeds of $1,792,299.

	(p)	During the year ended April 30, 2006, 100,000 common shares valued at $0.82 per share were issued for acquisition costs associated with the Southern Golden Promise property, 250,000 common shares valued at $0.76 per share were issued for acquisition costs associated with the Moran Lake property and 50,000 common shares valued at $0.90 per share were issued for acquisition costs associated with the Otter and Portage Lake properties.

	(q)	During the year ended April 30, 2007, the following options were exercised for total gross proceeds of $1,404,075 ($996,071 representing the fair market value of the stock options and agent’s options exercised was allocated to capital stock):

Stock Options		Agent’s Options

200,000	$ 0.23	215,866	$ 0.50
780,000	$ 0.25	366,898	$ 0.85
175,000	$ 0.28
410,000	$ 0.45	582,764
75,000	$ 0.58
84,000	$ 0.64
35,000	$ 0.65
75,000	$ 0.90
50,000	$ 1.00
206,000	$ 1.32

2,090,000

F-21

CROSSHAIR EXPLORATION & MINING CORP.

NOTES TO THE FINANCIAL STATEMENTS

April 30, 2007

(Expressed in Canadian dollars)

6.	CAPITAL STOCK AND CONTRIBUTED SURPLUS

	Share issuances (cont’d…)

	(r)	During the year ended April 30, 2007, 2,610,275 warrants at $0.75 per share, 4,044,111 warrants at $1.25 per share, 2,000,000 shares at a price of $1.75 per share, 129,515 agent’s warrants at $0.75 per share, and 144,348 agent’s warrants at $1.25 were exercised for total gross proceeds of $10,814,966.

	(s)	During the year ended April 30, 2007, the Company issued 490,375 common shares, under a warrant incentive program, for gross proceeds of $707,343. Under the terms of the program, holders of warrants expiring on November 3, 2007 were, for the two week period between February 13, 2007 and February 26, 2007, entitled to subscribe for an additional common share of the Company for every 10 warrants exercised, at the original exercise price.

	(t)	During the year ended April 30, 2007, 20,000 common shares valued at $1.27 per share were issued for acquisition costs associated with the Golden Promise property, 100,000 common shares valued at $1.96 per share, were issued for acquisition costs associated with the Southern Golden Promise property, 250,000 common shares valued at $2.44 per share, were issued for acquisition costs associated with the Moran Lake property and 75,000 common shares valued at $3.29 per share, were issued for acquisition costs associated with the Otter/Portage Lake property.

Share purchase warrants

At April 30, 2007, the following warrants were outstanding:

Number	Exercise
of Warrants	Price	Expiry Date

362,500	$1.25	November 3, 2007⁽¹⁾
37,383	$1.25	November 3, 2007⁽²⁾
399,883

	⁽¹⁾	These warrants were granted in connection with the private placement on November 3, 2005 (Note 6(f)).
	⁽²⁾	These warrants were granted with the compensation shares to the broker on completion of the private placement on November 3, 2005 (Note 6 (f)).

Stock options

The Company adopted a formal written stock option plan on July 26, 2004. Under this plan, the Company may grant options to directors, employees, consultants and certain other service providers. Option shares are subject to the minimum vesting requirement, with 25% of the total number of the options granted to be released every 6 months from the date of grant. The options can be granted for a maximum term of 5 years.

F-22

CROSSHAIR EXPLORATION & MINING CORP.

NOTES TO THE FINANCIAL STATEMENTS

April 30, 2007

(Expressed in Canadian dollars)

6.	CAPITAL STOCK AND CONTRIBUTED SURPLUS (cont’d…)

	Stock options (cont’d…)

	The following is a summary of stock options outstanding at April 30, 2007, April 30, 2006 and April 30, 2005 and changes during the years then ended.

	April 30, 2007				April 30, 2006				April 30, 2005



				Weighted				Weighted				Weighted
	Number			Average	Number			Average	Number			Average
	of options			Exercise Price	of options			Exercise Price	of options			Exercise Price

Outstanding, beginning of year	6,364,748		$	0.68	4,774,622		$	0.34	2,361,434		$	0.24
Exercised	(2,672,764	)		0.53	(2,363,874	)		0.48	(397,600	)		0.24
Cancelled or expired	(700,000	)		0.84	(393,750	)		0.33	(316,434	)		0.20
Granted	5,990,000			2.04	4,347,750			0.91	3,127,222			0.39

Outstanding, end of year	8,981,984		$	1.62	6,364,748		$	0.68	4,774,622		$	0.34

Currently exercisable	2,753,484		$	0.83

F-23

CROSSHAIR EXPLORATION & MINING CORP.

NOTES TO THE FINANCIAL STATEMENTS

April 30, 2007

(Expressed in Canadian dollars)

CAPITAL STOCK AND CONTRIBUTED SURPLUS (cont’d…)

Stock options (cont’d…)

At April 30, 2007, the following stock options were outstanding to directors, officers and employees:

Number	Exercise Price ($)	Expiry Date
191,984	0.85	November 2, 2007*
5,000	0.25	June 19, 2008
75,000	0.25	January 21, 2009
30,000	0.25	February 17, 2009
50,000	0.25	June 17, 2009
25,000	0.28	January 1, 2010
715,000	0.45	February 4, 2010
100,000	0.45	June 14, 2010
100,000	0.45	September 14, 2010
115,000	0.68	September 26, 2010
116,000	0.64	November 14, 2010
150,000	0.90	January 5, 2011
1,100,000	1.00	January 18, 2011
75,000	1.32	April 18, 2011
389,000	1.32	April 24, 2011
1,325,000	1.32	May 1, 2011
450,000	1.32	May 24, 2011
180,000	1.32	July 1, 2011
300,000	1.43	August 21, 2011
100,000	1.43	September 21, 2011
50,000	1.56	October 1, 2011
275,000	2.07	November 4, 2011
100,000	2.26	November 17, 2011
150,000	3.10	December 11, 2011
100,000	2.66	January 12, 2012
350,000	2.50	February 1, 2012
1,600,000	2.50	March 6, 2012
40,000	2.58	March 13, 2012
475,000	3.00	March 23, 2012
100,000	3.00	April 15, 2012
150,000	3.00	April 23, 2012

8,981,984

* 1,297,750 compensation options were issued to the broker in connection with the completion of the private placement on November 3, 2005 of which 738,868 were exercised during the year ended April 30, 2006. Each compensation option is exercisable into a unit of the Company at a price of $0.85 per unit for a period of two years. Each unit consists of one common share and one half of one transferable share purchase warrant (Note 6(f)).

F-24

CROSSHAIR EXPLORATION & MINING CORP.

NOTES TO THE FINANCIAL STATEMENTS

April 30, 2007

(Expressed in Canadian dollars)

6.	CAPITAL STOCK AND CONTRIBUTED SURPLUS (cont’d…)

	Stock-based compensation

	The Company recognizes compensation expense for all stock options granted using the fair value based method of accounting. The fair value of the options vested in the year ended April 30, 2007 totaled $3,696,601. The weighted average fair value of options granted in the year was $2.16 (April 30, 2006 - $0.91, April 30, 2005 - $0.39).

	The following weighted average assumptions were used for the Black-Scholes method of valuation of stock options granted during the years:

	April 30,	April 30,	April 30,
	2007	2006	2005

Risk-free interest rate	3.79%	3.70%	2.85%
Expected life of options	5 years	5 years	5 years
Annualized volatility	239%	140%	130%
Dividend rate	0%	0%	0%

	Escrow shares

	At April 30, 2007, a total of 140,625 (April 30, 2006 – 281,250; April 30, 2005 – 562,500) shares were held in escrow. No expense was recognized for the release of these shares as the release is not considered compensatory.

	These shares were originally placed in escrow as an incentive for management to reorganize the Company. The release of these shares from escrow is subject to certain performance conditions and to the direction and determination of the TSX Venture Exchange. The performance conditions state that the shares may be released from escrow on the basis of 15% of the original number for every $100,000 expended on exploration and development of a resource property calculated proportionately after the first $100,000 expenditure. If the performance conditions are not met by February 14, 2010, the shares will be returned and cancelled.

7.	SUPPLEMENTAL DISCLOSURES WITH RESPECT TO CASH FLOWS


For the years ended April 30,		2007		2006		2005

Cash paid during the year for income taxes	$	-	$	-	$	-

Cash paid during the year for interest	$	-	$	-	$	1,610

The following were significant non-cash investing and financing transactions during the year ended April 30, 2007:

	(a)	The Company recognized fair market value of $996,071 in respect of stock options and agent’s options exercised (Note 6(q)).

	(b)	The Company issued a total of 445,000 common shares at a value of $1,078,150 for property acquisitions (Note 6(t)).

	(c)	Included in accounts payable was $810,505 related to mineral property costs.

	(d)	All amounts owed to Paragon are for mineral property costs.

F-25

CROSSHAIR EXPLORATION & MINING CORP.

NOTES TO THE FINANCIAL STATEMENTS

April 30, 2007

(Expressed in Canadian dollars)

7.	SUPPLEMENTAL DISCLOSURES WITH RESPECT TO CASH FLOWS (cont’d…)

	The following were significant non-cash investing and financing transactions during the year ended April 30, 2006:

	(a)	The Company recognized fair market value of $754,112 in respect of stock options and agent’s options exercised (Note 6 (m)).

	(b)	The Company issued a total of 400,000 common shares at a value of $317,000 for property acquisitions (Note 6 (p)).

	(c)	The Company issued a total of 402,741 common shares at a value of $322,193 for finders’ fees in conjunction with a private placement (Note 6 (f)).

	(d)	Included in mineral property costs at April 30, 2006 is $86,315 incurred through accounts payable and accrued liabilities.

	(e)	The Company recognized compensation expenses of $1,335,620 for all stock options and agent’s warrants granted using the fair value based method of accounting.

	(f)	562,222 compensation options at $0.50 per share were issued to the broker in connection with the completion of the private placement on March 15, 2005 and 1,297,750 compensation options at $0.85 per share were issued to the broker in connection with the completion of the private placement on November 3, 2005

	The following were significant non-cash investing and financing transactions during the year ended April 30, 2005:

	(a)	The Company issued a total of 940,000 common shares at a value of $245,000 for property acquisition (Note 6 (g)).

	(b)	The Company cancelled 154,000 common shares at a value of $38,500 as a result of the termination of an agreement with a consultant to perform work in the current fiscal period (Note 6 (j)).

	(c)	The Company recognized fair market value of $133,739 in respect of stock options, agent’s options and brokers’ warrants exercised (Notes 6 (h) and (i)).

	(d)	The Company issued a total of 383,367 common shares at a value of $162,890 for finders’ fees in conjunction with private placements (Notes 6 (l) and (e)).

	(e)	The Company issued 60,000 common shares to settle debt of $10,200 with an officer of the Company (Note 6 (l)).

	(f)	The Company recognized compensation expenses of $23,113 for Agent Warrants granted in connection with the private placement (Note 6 (q))

F-26

CROSSHAIR EXPLORATION & MINING CORP.

NOTES TO THE FINANCIAL STATEMENTS

April 30, 2007

(Expressed in Canadian dollars)

8.	RELATED PARTY TRANSACTIONS

	The Company entered into transactions with related parties as follows:

	During the year ended April 30, 2007, the Company recorded management fees of $40,000 (2006 - $12,000, 2005 - $12,000) from a public Company with directors in common. At April 30, 2007, $Nil (April 30, 2006 - $Nil) was owed from this party.

	During the year ended April 30, 2007, the Company incurred management fees of $50,000 (2006 – $225,000, 2005 - $150,000) to a director. At April 30, 2007, $Nil (April 30, 2006 - $Nil) was owed.

	During the year ended April 30, 2007, the Company incurred directors’ fees of $60,500 (2006 - $63,000, 2005 - $5,000), to non-executive directors. At April 30, 2007, $Nil (April 30, 2006 - $Nil) was owed to these directors.

	During the year ended April 30, 2007, the Company incurred accounting fees of $Nil (2006 - $58,529, 2005 - $58,414) to a private company controlled by a former director. At April 30, 2007, $Nil (April 30, 2006 - $2,536) was owed.

	During the year ended April 30, 2007, the Company incurred legal fees of $25,882 (2006 – $70,907, 2005 - $91,322) to a company that a director is a partner of. At April 30, 2007, $Nil (April 30, 2006 - $Nil) was owed to this party.

	During the year ended April 30, 2007, the Company incurred geological consulting fees of $33,075 (2006 - $40,701, 2005 - $10,000) to a private company owned by a director. At April 30, 2007, $5,830 (April 30, 2006 - $Nil) was owed to this party.

	At April 30, 2007, $13,411 (April 30, 2006 - $11,685, April 30, 2005 - $6,435) was owed to directors and/or officers for expenses paid on behalf of the Company.

	As at April 30, 2007, $Nil (April 30, 2006 - $4,167) was owed from a director for overpayment of management fees.

	These transactions were incurred in the normal course of operations and, in management’s opinion, were undertaken with the same terms and conditions as transactions with unrelated parties.

9.	INCOME TAXES

	A reconciliation of income taxes at statutory rates with the reported taxes is as follows:


		2007			2006			2005

Loss before income tax recovery	$	(5,533,011	)	$	(3,683,593	)	$	(1,400,106	)

Expected income tax recovery at statutory rates	$	(1,961,735	)	$	(1,388,715	)	$	(498,438	)
Non-taxable items		1,965,026			1,095,317			129,033
Unrecognized (recognized) benefit of non-capital losses and resource expenditures		(3,291	)		(1,214,722	)		(385,315	)

Total income taxes (recovery)	$	-		$	(1,508,120	)	$	(754,720	)

F-27

CROSSHAIR EXPLORATION & MINING CORP.

NOTES TO THE FINANCIAL STATEMENTS

April 30, 2007

(Expressed in Canadian dollars)

9.	INCOME TAXES (cont’d…)

	The significant components of the Company's future tax assets are as follows:

		2007			2006

Future tax assets and (liabilities):
Loss carry forwards	$	606,851		$	1,049,668
Marketable Securities		11,033			-
Equipment		17,405			4,622
Share Issuance Costs		243,054			419,880
Mineral property and related exploration expenditures		917,927			(197,576	)

		1,796,270			1,276,594

Less: valuation allowances		(1,796,270	)		(1,276,594	)

Net future tax assets ( liabilities)	$	-		$	-

	During the year ended April 30, 2006, the Company issued 4,000,000 common shares on a flow-through basis for gross proceeds of $4,000,000. The flow-through agreement requires the Company to renounce certain deductions for Canadian exploration expenditures incurred on the Company’s resource properties. Future income taxes of $1,508,120 on the exploration expenditures to be renounced to shareholders were applied against capital stock.

	The Company has available for deduction against future taxable income non-capital losses of approximately $2,784,000. These losses, if not utilized, will expire commencing in 2016. Subject to certain restrictions, the Company also has resource expenditures available to reduce taxable income in future years. Future tax benefits which may arise as a result of these non-capital losses and resource deductions have not been recognized in these financial statements and have been offset by a valuation allowance.

10.	SEGMENTED INFORMATION

	The Company operates in one reportable operating segment, being the exploration and development of mineral properties. Geographical information is as follows:

		April 30,		April 30,
		2007		2006
Equipment
Canada	$	366,080	$	126,369
USA		-		-

	$	366,080	$	126,369

Mineral properties
Canada	$	14,535,443	$	3,907,039
USA		15,849		12,722


	$	14,551,292	$	3,919,761

F-28

CROSSHAIR EXPLORATION & MINING CORP.

NOTES TO THE FINANCIAL STATEMENTS

April 30, 2007

(Expressed in Canadian dollars)

11.	FINANCIAL INSTRUMENTS

	The Company's financial instruments consist of cash and cash equivalents, marketable securities, receivables, accounts payable and accrued liabilities, due to Paragon and due from/to related parties. Unless otherwise noted, it is management's opinion that the Company is not exposed to significant interest, currency or credit risks arising from these financial instruments. The fair values of these financial instruments approximate their carrying values, unless otherwise noted.

12.	COMMITMENTS AND CONTINGENCIES

	a)	The Company has entered into an operating lease agreement for its office premises in Newfoundland and Vancouver. The annual lease commitments under these leases are as follows:

2008		$ 76,804
2009		48,586
2010		47,954
2011		35,491

13.	SUBSEQUENT EVENTS

	Subsequent to April 30, 2007, the Company entered into an option agreement with Belmont Resources Inc. and International Montoro Resources Inc. to acquire a 75% interest in four mineral licenses totalling 139 claims located in the central mineral belt of Labrador, by carrying out $800,000 in exploration expenditures and issuing 175,000 common shares in the capital of the Company over a three year period. The agreement was approved by the TSX Venture Exchange on May 28, 2007.

14.	DIFFERENCES BETWEEN CANADIAN AND UNITED STATES GENERALLY ACCEPTED ACCOUNTING PRINCIPLES

	These financial statements have been prepared in accordance with Canadian GAAP. Material variations in the accounting principles, practices and methods used in preparing these financial statements from principles, practices and methods accepted in the United States ("United States GAAP") are described and quantified below.

F-29

CROSSHAIR EXPLORATION & MINING CORP.

NOTES TO THE FINANCIAL STATEMENTS

April 30, 2007

(Expressed in Canadian dollars)

14.	DIFFERENCES BETWEEN CANADIAN AND UNITED STATES GENERALLY ACCEPTED ACCOUNTING PRINCIPLES (cont’d….)

	Balance sheets

	The impact of the differences between Canadian GAAP and United States GAAP on the balance sheets would be as follows:

					2007									2006
		Balance,			Adjustments			Balance,			Balance,			Adjustments			Balance,
		Canadian						US			Canadian						US
		GAAP						GAAP			GAAP						GAAP
Assets:
Current assets	$	16,747,171		$	-		$	16,747,171		$	14,320,262		$	-		$	14,320,262
Equipment		366,080			-			366,080			126,369			-			126,369
Mineral properties		14,551,292			(12,474,517	)		2,076,775			3,919,761			(3,163,636	)		756,125

Total assets	$	31,664,543		$	(12,474,517	)	$	19,190,026		$	18,366,392		$	(3,163,636	)	$	15,202,756

Liabilities
Current liabilities	$	1,356,467		$	-		$	1,356,467		$	226,441		$	-		$	226,441
Flow-through share
liability		-			-			-			-			401,546			401,546
Shareholders’ equity
Capital stock		44,135,660			-			44,135,660			29,135,054			1,444,640			30,579,694
Contributed surplus		3,888,533			-			3,888,533			1,188,003			-			1,188,003
Deficit		(17,716,117	)		(12,474,517	)		(30,190,634	)		(12,183,106	)		(5,009,822	)		(17,192,928	)

Total liabilities and
shareholders’ equity	$	31,664,543		$	(12,474,517	)	$	19,190,026		$	18,366,392		$	(3,163,636	)	$	15,202,756

Statements of operations

The impact of the differences between Canadian GAAP and United States GAAP on the statements of operations would be as follows:

		2007			2006			2005

				$
Loss for the year under Canadian GAAP	$	(5,533,011	)		(2,175,473	)	$	(645,386	)
Adjustments:
Mineral property expenditures incurred during the year		(9,310,881	)		(2,508,260	)		(1,279,032	)
Mineral properties written off during the year		-			1,325,707			81,886
Flow-through share premium (discount) paid in excess of
(below) market value		-			491,714			124,940
Future income tax recovery		-			(1,508,120	)		(754,720	)
Loss under US GAAP	$	(14,843,892	)	$	(4,374,432	)	$	(2,472,312	)

Weighted average number of common shares outstanding
under US GAAP		62,293,444			46,983,232			24,114,631

Loss per share under US GAAP	$	(0.24	)	$	(0.09	)	$	(0.10	)

F-30

CROSSHAIR EXPLORATION & MINING CORP.

NOTES TO THE FINANCIAL STATEMENTS

April 30, 2007

(Expressed in Canadian dollars)

14.	DIFFERENCES BETWEEN CANADIAN AND UNITED STATES GENERALLY ACCEPTED ACCOUNTING PRINCIPLES (cont’d….)

	Statements of cash flows

	The impact of the differences between Canadian GAAP and United States GAAP on the statements of cash flows would be as follows:

		2007			2006			2005
Net cash flows from operating activities
Under Canadian GAAP	$	(3,798,445	)	$	(1,950,263	)	$	(756,660	)
Mineral properties		(8,238,406	)		(2,421,945	)		(1,279,032	)
Net cash used in operating activities under US GAAP		(12,036,851	)		(4,372,208	)		(2,035,692	)

Net cash flows from financing activities
Under Canadian GAAP and US GAAP		12,926,385			13,834,710			6,499,685

Net cash flows used in investing activities
Under Canadian GAAP		(8,764,499	)		(2,683,178	)		(1,510,334	)
Mineral properties		8,238,406			2,421,945			1,279,032
Net cash provided by (used in) investing activities under		(526,093	)		(261,233	)		(231,302	)
US GAAP
Net increase in cash and cash equivalents during the year		363,441			9,201,269			4,232,691
Cash and cash equivalents, beginning the year		13,947,976			4,746,707			514,016
Cash and cash equivalents, end of year	$	14,311,417		$	13,947,976		$	4,746,707

Mineral property interests and deferred exploration costs

In accordance with EITF 04-02, the Company classifies the costs of acquiring its mineral interests as tangible assets resulting in no difference between Canadian and U.S GAAP. Under U.S. GAAP exploration costs on mineral properties, other than acquisition costs, prior to the establishment of proven or probable reserves are expensed as incurred. Under Canadian GAAP these costs may be deferred.

Under US GAAP, the Company performs evaluations of its investment in mineral properties to assess the recoverability and the residual value of its investments in these assets. All mineral properties are reviewed for impairment whenever events or circumstances change which indicates the carrying amount of an asset may not be recoverable, utilizing established guidelines based on undiscounted future net cash flows from the asset or upon the determination that certain exploration properties do not have sufficient potential for economic mineralization.

F-31

CROSSHAIR EXPLORATION & MINING CORP.

NOTES TO THE FINANCIAL STATEMENTS

April 30, 2007

(Expressed in Canadian dollars)

14.	DIFFERENCES BETWEEN CANADIAN AND UNITED STATES GENERALLY ACCEPTED ACCOUNTING PRINCIPLES (cont’d….)

	Flow-through shares

	Under Canadian income tax legislation, the Company is permitted to issue shares whereby the Company agrees to incur qualifying expenditures (as defined under the Income Tax Act of Canada) and renounce the related income tax deductions to the investors. Under Canadian GAAP, flow-through shares are accounted for as part of the issuance of capital stock at the price paid for the shares, net of any future income tax liability. Under United States GAAP, any difference between the market price of the Company's stock and the fair value of the flow-through shares must be recorded as a liability if a premium is paid by investors or as an asset if investors are purchasing the shares at a discount. The asset or liability is charged to income as the flow-through share proceeds are expended on qualifying expenditures.

	During the year the Company did not issue any flow-through shares and accordingly there was no difference between Canadian and United States GAAP.

	During the year ended April 30, 2006, the Company issued 4,000,000 flow-through shares for total proceeds of $4,000,000. As the market price of the Company’s stock was less than the fair value of the flow-through shares issued, a premium of $398,454 has been recorded for the expended cash on qualifying expenditures and a flow- through share liability of $401,546 was recorded for the unexpended amount as of April 30, 2006. During the year ended April 30, 2005, the Company issued 6,830,000 flow-through shares for total proceeds of $2,120,000. As the market price of the Company’s stock was less than the fair value of the flow-through shares issued, a premium of $124,940 was recorded for the expended cash on qualifying transactions and a flow-through share liability of $93,260 for the unexpended amount as of April 30, 2005.

	Loss per share

	Under both Canadian and United States generally accepted accounting principles basic loss per share is calculated using the weighted average number of common shares outstanding during the year.

	Under United States generally accepted accounting principles, the weighted average number of common shares outstanding excludes any shares held in escrow for which the release is subject to certain performance conditions. The weighted average number of shares outstanding under United States generally accepted accounting principles for the years ended April 30, 2007, 2006 and 2005 were 62,293,444, 46,983,232, and 24,114,631 respectively.

F-32

CROSSHAIR EXPLORATION & MINING CORP.

NOTES TO THE FINANCIAL STATEMENTS

April 30, 2007

(Expressed in Canadian dollars)

14.	DIFFERENCES BETWEEN CANADIAN AND UNITED STATES GENERALLY ACCEPTED ACCOUNTING PRINCIPLES (cont’d….)

	New accounting pronouncements

	In July 2006, the Financial Accounting Standards Board (“FASB”) issued FASB Interpretation No. 48, “Accounting for Uncertainty in Income Taxes” (“FIN 48”). FIN 48 clarifies the accounting and reporting for uncertainties in income tax law. FIN 48 prescribes a comprehensive model for the financial statement recognition, measurement, presentation, and disclosure of uncertain tax positions taken or expected to be taken in income tax returns. FIN 48 is effective for fiscal years beginning after December 15, 2006. The adoption of FIN 48 is not anticipated to have an impact on the Company’s financial position or results of operations.

	In September 2006, the FASB issued SFAS No. 157, “Fair Value Measurements”. SFAS No. 157 establishes a framework for measuring the fair value of assets and liabilities. This framework is intended to provide increased consistency in how fair value determinations are made under various existing accounting standards which permit, or in some cases require, estimates of fair market value. SFAS No. 157 is effective for fiscal years beginning after November 15, 2007, and interim periods within those fiscal years. Earlier application is encouraged, provided that the reporting entity has not yet issued financial statements for that fiscal year, including any financial statements for an interim period within that fiscal year. The Company is currently assessing the impact of SFAS No. 157 the Company’s financial position and results of operations, but does not anticipate a material impact.

	In February, 2007, the FASB issued SFAS No. 159 “The Fair Value Option for Financial Assets and Financial Liabilities”. SFAS No. 159 permits entities to choose to measure many financial assets and financial liabilities at fair value. Unrealized gains and losses on items for which the fair value option has been elected are reported in earnings. SFAS No. 159 is effective for fiscal years beginning after November 15, 2007. The Company is currently assessing the impact of SFAS No. 159 on our financial position and results of operations, but are does not anticipate a material impact.

F-33

ITEM 19. EXHIBITS

12.1	Section 302 CEO Certification

12.2	Section 302 CFO Certification

13.1	Section 906 CEO Certification

13.2	Section 906 CFO Certification

SIGNATURES

The registrant hereby certifies that it meets all of the requirements for filing on Form 20-F, as amended by Form 20-F/A (Amendment No. 1), and that it has duly caused and authorized the undersigned to sign this annual report on its behalf.

CROSSHAIR EXPLORATION & MINING CORP.

/s/ Mark J. Morabito
By: Mark J. Morabito
President and Chief Executive Officer

Date: June 25, 2008