GoldON Resources Ltd V.GLD

Rest of MDA

[pastorboy]

multi-element.

Diamond Drilling Program

In January 2011, the Company completed a nine-hole diamond drilling program on the

northeast portion of its primary claim block concentrated on the Field Zone, which borders PC

Gold Inc.’s property near its recent No. 20 Vein discovery, and the Southwest Powderhouse

Zone, explored most recently in 2004 by the former holder of the property with incomplete

historical disclosure. Highlights of the drilling include:

Hole Number

From

(feet)

To

(feet)

Length

(feet)

Gold

(grams per tonne)

NCM-10-01 367 387 20 0.66

including 377 382 5 1.51

NCM-10-06 39 54 15 2.63

including 44 49 5 6.50

NCM-10-07 99 189 90 0.52

including 119 124 5 4.28

and including 174 189 15 1.39

Samples were selected in the field under the supervision of Brian H. Newton P.Geo, transported

by bonded courier to the facilities of Activation Laboratories Ltd. in Thunder Bay, and assayed

using Fire Assay ICPOES for gold and Total Digestion ICP (total) for other metals.

The holes drilled in this program are summarized as follows:

Field Zone

Holes NCM-10-01 through NCM-10-04 were exploration holes planned to determine an

extension of the No. 20 Vein discovery adjacent to PC Gold Inc.’s property to the east. Each

hole reported some level of gold mineralization; in particular NCM-10-01 intersected 1.51 grams

of gold per tonne over five feet from 377 feet to 382 feet down the hole as stated above. In

addition

regarding

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In additi

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CM-10-05 th

Historically, t

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results of t

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stent approa

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ed 2.63 gram

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Banded Iron F

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old from 1.7

sted in Iron F

s in both the

outheast and

meters belo

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zation seen

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-10-09 were

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LF anomalie

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licified and o

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10-01 over

mpilation st

d Iron Forma

focus on t

The historic

the project

7 million tons

Formation w

e quartz and

d are interpr

ow surface.

- 6 -

ovide valuab

silicified and

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of quartz v

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atricia Gold

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- 7 -

hosts several gold showings, as well as having approximately 30,000 ounces of historical

production reported as coming from the Company’s claims adjoining the Central Patricia Mine.

The Company is planning a program to test the possible extensions of Iron Formation-hosted

gold zones interpreted to lie below the limits of the Central Patricia Mine workings. Based on the

recent discovery by PC Gold Inc. of a shallow-lying, large-scale gold arsenic system at their

Central Pat East project, the Company will also conduct appropriate exploration to examine the

extensive land package held between the historical Central Patricia Mine and the PC Gold Inc.

discovery to identify similar mineralization.

Mollie River Property

The Company owns a 100% interest in three mineral claims covering 592 hectares located in

Benneweis Township in the Swayze greenstone belt area of northwestern Ontario. In April

2010, the Company completed a geophysical survey of the property. Vision Exploration of

Timmins, Ontario undertook line cutting and followed up immediately with a 30-line-kilometre

magnetometer and induced polarization survey.

In November 2010, the Company granted an option to First Lithium Resources Inc. to earn up to

a 75% interest in the property. First Lithium may earn a 60% undivided interest in the property

by paying and issuing to Newcastle $15,000 cash (received) and 500,000 First Lithium shares

(received), issuing an additional 500,000 shares and incurring $250,000 of exploration

expenditures within one year, and incurring an additional $250,000 of exploration expenditures

within two years.

First Lithium may acquire an additional 15% undivided interest by issuing to Newcastle an

additional 750,000 First Lithium shares within two years and incurring an additional $500,000 of

exploration expenditures within three years.

Chester Township Property

The Company owns a 100% interest in one mineral claim covering 29 hectares located in

Chester Township in northwestern Ontario.

The property is approximately one kilometre from Trelawney Resources’ (TRR-TSXV) Cote

Lake deposit and is surrounded by Augen Gold Corp’s (GLD-TSXV) South Swayze Project.

While Trelawney continues its successful exploration in the Cote Lake area, Augen Gold

commenced drilling several deep holes in January 2011 on the eastern part of its claim group

bordering Trelawney Resources’ Cote Lake deposit.

Trelawney’s project area is host to at least 12 known mineralized structures characterized by

wide zones of low to moderate grade gold +/- copper associated with brecciated intermediate to

felsic (locally mafic) intrusive rocks. Newcastle’s Chester Township Property comprises felsic

intrusive and felsic metavolcanic rocks. Mineralization in Trelawney’s project area consists of

disseminated and fracture controlled sulphides that generally correlate to gold values. The Cote

Lake deposit has now been intersected on seven sections spaced 100 metres apart and traced

to depths of up to 500 metres. It is open along strike and to depth on all sections.

In January 2011, the Company commenced line cutting and a three line–kilometre induced

polarization (IP) survey on the Chester Township Property. This IP survey follows up on a VLFEM

and Magnetics survey that was completed in June of 2010 that was successful in outlining

several prospective areas that warrant further exploration. Results from the VLF-EM survey may

be reflecting disseminated or semi-massive accumulations of sulphide minerals similar to those

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associated with the mineralized zones on Trelawney’s Chester Project. The current IP survey

will enhance the understanding of these anomalous zones as they are often prospective for gold

and base metal mineralization.

Summary of Unaudited Quarterly Results

2011 2010 2009

2nd Quarter 1st Quarter 4th Quarter 3rd Quarter 2nd Quarter 1st Quarter 4th Quarter 3rd Quarter

Revenue $ - $ - $ - $ - $ - $ - $ - $ -

Operating loss (129,227) (142,981) (411,479) (437,693) (109,682) (163,683) (68,179) (59,307)

Operating loss per share (0.002) (0.002) (0.006) (0.008) (0.002) (0.004) (0.003) (0.002)

Net income (loss) (46,673) 236,653 (1,382,917) (441,630) (72,504) (163,683) (64,029) (55,307)

Net income per share (0.001) 0.003 (0.022) (0.008) (0.001) (0.004) (0.002) (0.002)

Variations in operating loss from quarter to quarter typically result from increases or decreases

in property acquisition and exploration activity. During periods of greater activity, professional

fees, consulting fees, costs relating to regulatory approvals and travel costs will typically

increase.

During the first quarter of 2011, gains on marketable securities of $402,821 resulted in an

overall net profit for the quarter. The net losses in the second quarters of 2011 and 2010 were

reduced by non-cash recoveries of future income taxes of $226,069 and $26,000, respectively.

During the third and fourth quarters of 2010, non-cash stock-based compensation expense

increased the operating loss by $307,011 and $207,889, respectively. During the fourth quarter

of 2010, net loss increased when management deemed it prudent to sell or write down the value

of three mineral properties.

During each of the two quarters of 2009, management endeavoured to minimize operating

expenses in light of the economic conditions at that time.

Liquidity and Capital Resources

The Company does not yet generate positive cash flow from operations, and is therefore reliant

upon the sale of common shares to fund its operations. As of the December 31, 2010 quarterend,

management believed the Company was adequately funded for the short term, with cash

resources of approximately $573,000.

The Company is able to meet its ongoing financial obligations as they become due. It has no

debt obligations and no commitments other than as described herein and in its financial

statements for the period ended December 31, 2010, which financial statements are

incorporated by reference. Management believes it has sufficient working capital to fund

operating costs through at least June 2011.

Outstanding Share Data

As of the date hereof, the Company has 78,931,022 common shares issued and outstanding.

The Company has, as of the date hereof, outstanding warrants issued pursuant to private

placements, which may be exercised to purchase a total of 7,167,382 shares. Of this total,

2,700,000 warrants may be exercised at
.10 per share until July 20, 2011, 3,153,332 warrants

may be exercised at
.12 per share until October 16, 2011, 500,000 warrants may be

- 9 -

exercised at
.15 per share until October 16, 2011, 274,500 broker warrants may be exercised

at
.15 per share until October 16, 2011, and 539,550 broker warrants may be exercised at

.09 per share until March 16, 2012.

In addition, the Company has outstanding options which may be exercised to purchase a total of

5,150,000 shares as of the date hereof. Of this total, 650,000 options may be exercised at
.10

per share until March 14, 2011, 2,500,000 options may be exercised at
.10 per share until

January 12, 2015, 500,000 options may be exercised at
.10 per share until March 5, 2015,

500,000 options may be exercised at
.10 per share until March 30, 2012, and 1,000,000

options may be exercised at
.105 per share until May 31, 2015.

Transactions With Related Parties

During the quarter ended December 31, 2010, the Company made certain payments to officers

and a corporation controlled by a director in respect of the management of the company. Refer

to note 11 to the Company=s December 31, 2010 financial statements, which financial

statements are incorporated by reference.

Changes in Accounting Policies Including Initial Adoption

The Company expects to adopt the following accounting standards updates during its financial

year commencing July 1, 2011.

International Financial Reporting Standards (AIFRS@)

The AcSB requires all public companies to adopt International Financial Reporting Standards

(“IFRS”) for interim and annual financial statements for fiscal years beginning on or after

January 1, 2011. Companies will be required to provide IFRS comparative information for the

previous fiscal period. The transition from Canadian Generally Accepted Accounting Principles

to IFRS will be applicable for the Company’s first quarter ending September 30, 2011. Although

IFRS employs a conceptual framework that is similar to Canadian GAAP, there are some

differences in recognition, measurement, and disclosure. It is anticipated, however, that the

Company’s financial results and financial position as disclosed in the Company’s current

Canadian GAAP financial statements will not be significantly different when presented in

accordance with IFRS.

Management has developed and is implementing a project plan to ensure full compliance with

this requirement by June 30, 2011. The following is a summary of the four primary phases of the

plan and the expected timing of activities related to the Company’s transition to IFRS.

Diagnostic impact assessment phase

This phase consists of performing an initial analysis of key areas for which changes to

accounting policies may be required. While an analysis will be required for all current accounting

policies, the Company expects to complete by March 31, 2011 its review of the most significant

areas, including:

1. IFRS 1 – First-time Adoption of International Financial Reporting Standards

2. IFRS 2 – Share-based Payment

3. IFRS 6 – Exploration for and Evaluation of Mineral Resources

4. IAS 1 – Presentation of Financial Statements

5. IAS 12 – Income Taxes

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6. IAS 36 – Impairment of Assets

Design, planning and solution development phase

This phase involves the development of the detailed plan for convergence and implementation,

analyses of policy alternatives allowed under IFRS, the specification of changes required to

existing accounting policies, and the development of solutions for information systems and

business processes. The Company expects to complete this phase by March 31, 2011. The

Company will identify accounting differences and policy alternatives, including one-time

accounting alternatives under IFRS. As part of its analysis of potential changes to significant

accounting policies, the Company will assess what changes may be required to its accounting

systems and processes. The financial reporting impact of the transition to IFRS has not been

estimated at this time.

Implementation phase

This phase includes the completion and formal authorization of recommended changes to

accounting policies, including transition elections to apply changes retroactively or

prospectively, the execution of changes to information systems and business processes,

delivery of training programs and the preparation of the opening balance sheet and the quarterly

and annual financial statements for both 2012 and the comparative 2011 financial years. In

addition, the impact of IFRS on contractual arrangements will be considered. The Company

expects to complete this phase by July 1, 2011.

Post implementation phase

This phase involves a compliance review of the conversion project to assess the accuracy and

consistency with which IFRS accounting policies are being applied, the adoption of sustainable

processes and procedures and the adequacy of information technology solutions, training

programs and other business impact solutions.

Business combinations

In January 2009, the CICA issued Handbook Section 1582, “Business Combinations,” which

replaces the existing standards. This section establishes the standards for the accounting of

business combinations, and states that all assets and liabilities of an acquired business will be

recorded at fair value. Estimated obligations for contingent considerations and contingencies will

also be recorded at fair value at the acquisition date. The standard also states that acquisitionrelated

costs will be expensed as incurred and that restructuring charges will be expensed in the

periods after the acquisition date. This standard is applied prospectively to business

combinations with acquisition dates on or after January 1, 2011. This standard is equivalent to

the International Financial Reporting Standards on business combinations. Earlier adoption is

permitted.

Consolidated financial statements

In January 2009, the CICA issued Handbook Section 1601, “Consolidated Financial

Statements,” which replaces the existing standards. This section establishes the standards for

preparing consolidated financial statements and is effective for interim and annual consolidated

financial statements beginning on or after January 1, 2011. This standard is equivalent to the

International Financial Reporting Standards on consolidated financial statements. Earlier

adoption is permitted.

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Non-controlling interests

In January 2009, the CICA issued Handbook Section 1602, “Non-controlling Interests,” which

establishes standards for the accounting of non-controlling interests of a subsidiary in the

preparation of consolidated financial statements subsequent to a business combination and is

effective for interim and annual consolidated financial statements beginning on or after January

1, 2011. This standard is equivalent to the International Financial Reporting Standards on

consolidated and separate financial statements. Earlier adoption is permitted.

The Company is required to adopt Sections 1582, 1601 and 1602 concurrently; however, the

Company does not anticipate adopting these sections prior to the adoption of IFRS and

therefore does not expect any impact to its financial statements.

Financial Instruments and Other Instruments

The Company’s financial instruments consist of cash, accounts receivable, marketable

securities, deposits, and accounts payable and accrued liabilities. The fair value of these

financial instruments approximates their carrying value due to the short-term nature of these

financial statements. It is management’s opinion that the Company is not exposed to significant

interest, currency, or credit risks arising from these financial instruments. The Company does

not maintain non-financial instruments.

Other Information

Additional information relating to the Company is available from the Company=s website at

www.newcastleminerals.com and on SEDAR at www.sedar.com.

ON BEHALF OF THE BOARD

Signed AMichael Romanik@

Michael Romanik, President