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UNITED STATES
SECURITIES AND EXCHANGE COMMISSIONWashington, DC 20549


FORM 10-Q

xQUARTERLY REPORT UNDER SECTION 13
OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
FOR THE QUARTERLY PERIOD ENDED July 31, 2009

Commission File
Number      0-20722

|                                                                 
|-----------------------------------------------------------------
|FIRSTGOLD
 CORP.                                                 
|                                                                 
|(Exact name of small business issuer as specified in its charter)

|                                                               |  |                                        
|-------------------------------------------------------------- |  | ---------------------------------------
|DELAWARE                                                       |  | 16-1400479                             
|                                                               |  |                                        
|(State of other jurisdiction of incorporation or organization) |  | (I.R.S. Employer Identification Number)
|                                                               |  |                                        
|1055 Cornell Avenue                                            |  |                                        
|Lovelock, NV                                                   |  | 89419                                  
|                                                               |  |                                        
|(Address of Principal Executive Offices)                       |  | Zip Code                               
|                                                               |  |                                        
|Issuers telephone number:                                     |  | (775) 273-7800                         

Indicate by
check mark whether the issuer (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 issuer was required to file such
reports), and (2) has been subject to such filing requirements for the past 90
days:

YES x           NO
o

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

YES o                NO
x

Common stock,
$0.001 par value, of which 182,447,224 were issued and outstanding as
of September 30, 2009.

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

YES x            NO
o

| |                            |                              | 
| | -------------------------- | ---------------------------- | 
| | Large
 accelerated filer o | Accelerated
 filer o         | 
| |                            |                              | 
| | Non-accelerated
 filer o   | Smaller
 reporting company x | 

1

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INDEX

|                                                                    |      | 
|------------------------------------------------------------------- | ---- | 
|                                                                    | Page
|                                                                    |     
|                                                                    |      | 
|PART I - FINANCIAL INFORMATION                                      | 3    | 
|                                                                    |      | 
|ITEM 1. FINANCIAL STATEMENTS                                        | 3    | 
|                                                                    |      | 
|ITEM 2. MANAGEMENTS DISCUSSION AND
 ANALYSIS OR PLAN OF OPERATIONS | 24   | 
|                                                                    |      | 
|ITEM 4T. CONTROLS AND PROCEDURES                                    | 36   | 
|                                                                    |      | 
|PART II - OTHER INFORMATION                                         | 37   | 
|                                                                    |      | 
|ITEM 1A. FACTORS AFFECTING FUTURE OPERATING
 RESULTS                | 37   | 
|                                                                    |      | 
|ITEM 2. UNREGISTERD SALES OF EQUITY
 SECURITIES                     | 39   | 
|                                                                    |      | 
|ITEM 3. DEFAULTS UPON SENIOR SECURITIES                             | 40   | 
|                                                                    |      | 
|ITEM 5. OTHER INFORMATION                                           | 41   | 
|                                                                    |      | 
|ITEM 6. EXHIBITS                                                    | 41   | 

2

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PART I - FINANCIAL
INFORMATION

|        |                     
|------- | --------------------
|ITEM 1. | FINANCIAL STATEMENTS

FIRSTGOLD CORP.
INDEX TO UNAUDITED FINANCIAL STATEMENTS

|                                                                                                              |     
|------------------------------------------------------------------------------------------------------------- | ----
|                                                                                                              | Page
|                                                                                                              |     
|                                                                                                              |     
|Condensed Balance Sheet as of July 31, 2009 (Unaudited) and for
 fiscal year ended January 31, 2009 (Audited) | 4   
|                                                                                                              |     
|Condensed Statements of Operations for the three and six months ended
 July 31, 2009 and 2008 (Unaudited)     | 6   
|                                                                                                              |     
|Condensed Statements of Cash Flows for the six months ended July 31,
 2009 and 2008 (Unaudited)               | 7   
|                                                                                                              |     
|Notes to Unaudited Financial Statements                                                                       | 9   

3

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|                              
|------------------------------
|FIRSTGOLD CORP.               
|(AN EXPLORATION STAGE COMPANY)
|BALANCE SHEET                 
|                              
|                              

|                                                                                                                                                                                         |  |                |            |                   |   |            | 
|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- |  | -------------- | ---------- | ----------------- | - | ---------- | 
|                                                                                                                                                                                         |  | July 31,
 2009 |            | January 31,
 2009 |  
|                                                                                                                                                                                         |  |                |            |                   |  
|                                                                                                                                                                                         |  | (unaudited)    |            |                   |   |           
|                                                                                                                                                                                         |  |                |            |                   |   |           
|ASSETS                                                                                                                                                                                  
|                                                                                                                                                                                        
|Current assets:                                                                                                                                                                          |  |                |            |                   |   |            | 
|Cash                                                                                                                                                                                     |  | $              | 81,918     |                   | $ | 15,666     | 
|Receivables                                                                                                                                                                              |  |                | 4,365      |                   |   | 81,339     | 
|Deposits                                                                                                                                                                                 |  |                | 7,368      |                   |   | 7,368      | 
|Prepaid expense                                                                                                                                                                          |  |                | 77,683     |                   |   | 285,180    | 
|                                                                                                                                                                                         |  |                |            |                   |   |            | 
|Total current assets                                                                                                                                                                     |  |                | 171,334    |                   |   | 389,553    | 
|                                                                                                                                                                                         |  |                |            |                   |   |            | 
|Property, plant and equipment,
 net of accumulated depreciation of $1,531,333 and $936,744 at July 31, and
 January 31, 2009, respectively                                               |  |                | 15,386,738 |                   |   | 16,452,452 | 
|                                                                                                                                                                                         |  |                |            |                   |   |            | 
|Other Assets                                                                                                                                                                             |  |                |            |                   |   |            | 
|Restricted cash                                                                                                                                                                          |  |                | 2,858,704  |                   |   | 2,967,983  | 
|                                                                                                                                                                                         |  |                |            |                   |   |            | 
|                                                                                                                                                                                         |  |                |            |                   |   |            | 
|Total assets                                                                                                                                                                             |  | $              | 18,416,776 |                   | $ | 19,809,988 | 
|                                                                                                                                                                                         |  |                |            |                   |   |            | 
|                                                                                                                                                                                         |  |                |            |                   |   |            | 
|                                                                                                                                                                                         |  |                |            |                   |   |            | 
|LIABILITIES AND SHAREHOLDERS DEFICIT                                                                                                                                                   
|                                                                                                                                                                                         |  |                |            |                   |   |            | 
|Current liabilities                                                                                                                                                                      |  |                |            |                   |   |            | 
|Accounts payable                                                                                                                                                                         |  | $              | 3,421,710  |                   | $ | 2,543,137  | 
|Accrued expenses                                                                                                                                                                         |  |                | 4,373,820  |                   |   | 1,716,169  | 
|Senior secured notes net of deferred
 financing costs of $4,290,118 and $5,701,291 and original issue discount of
 $711,959 and $1,275,808at July 31, and January 31, 2009, respectively |  |                | 7,005,123  |                   |   | 5,022,901  | 
|Convertible debentures net of deferred
 financing costs of $2,992 and $32,132 at July 31, and January 31, 2009,
 respectively                                                            |  |                | 447,008    |                   |   | 637,338    | 
|Notes payable                                                                                                                                                                            |  |                | 1,780,832  |                   |   | 1,265,675  | 
|                                                                                                                                                                                         |  |                |            |                   |   |            | 
|Total current liabilities                                                                                                                                                                |  |                | 17,028,493 |                   |   | 11,185,220 | 
|                                                                                                                                                                                         |  |                |            |                   |   |            | 
|Long-term liabilities                                                                                                                                                                    |  |                |            |                   |   |            | 
|Accrued reclamation costs                                                                                                                                                                |  |                | 2,866,989  |                   |   | 2,866,989  | 
|Deferred revenue                                                                                                                                                                         |  |                | 800,000    |                   |   | 800,000    | 
|                                                                                                                                                                                         |  |                |            |                   |   |            | 
|Total long-term liabilities                                                                                                                                                              |  |                | 3,666,989  |                   |   | 3,666,989  | 
|                                                                                                                                                                                         |  |                |            |                   |   |            | 
|                                                                                                                                                                                         |  |                |            |                   |   |            | 
|Total liabilities                                                                                                                                                                        |  |                | 20,695,482 |                   |   | 14,852,209 | 

4

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|                              
|------------------------------
|FIRSTGOLD CORP.               
|(AN EXPLORATION STAGE COMPANY)
|BALANCE SHEET                 
|                              
|                              

|                                                                                                                                                                                        |  |          |             |             |   |             |  
|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- |  | -------- | ----------- | ----------- | - | ----------- | -
|                                                                                                                                                                                        |  | July 31, |             | January 31, |  
|                                                                                                                                                                                        |  | 2009     |             | 2009        |  
|                                                                                                                                                                                        |  |          |             |             |  
|                                                                                                                                                                                        |  |          | (unaudited) |             |   |             |  
|                                                                                                                                                                                        |  |          |             |             |  
|                                                                                                                                                                                        |  |          |             |             |   |             |  
|Commitments and contingencies                                                                                                                                                           |  |          |             |             |   |             |  
|                                                                                                                                                                                        |  |          |             |             |   |             |  
|Shareholders surplus (deficit)                                                                                                                                                         |  |          |             |             |   |             |  
|Common stock, $0.001 par value                                                                                                                                                          |  |          |             |             |   |             |  
|250,000,000 shares authorized at July 31,
 and January 31, 2009, respectively 145,303,888 and 136,565,544 shares issued
 and outstanding at July 31, and January 31, 2009, respectively |  |          | 145,303     |             |   | 136,566     |  
|Additional paid in capital                                                                                                                                                              |  |          | 52,257,189  |             |   | 50,656,578  |  
|Deficit accumulated during the exploration
 stage                                                                                                                                       |  |          | (54,648,110 | )           |   | (45,835,365 | )
|                                                                                                                                                                                        |  |          |             |             |   |             |  
|Total shareholders surplus (deficit)                                                                                                                                                   |  |          | (2,245,618  | )           |   | 4,957,779   |  
|                                                                                                                                                                                        |  |          |             |             |   |             |  
|                                                                                                                                                                                        |  |          |             |             |   |             |  
|Total liabilities and shareholders surplus
 (deficit)                                                                                                                                  |  | $        | 18,416,776  |             | $ | 19,809,988  |  
|                                                                                                                                                                                        |  |          |             |             |   |             |  

5

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FIRSTGOLD CORP.
(AN EXPLORATION STAGE COMPANY)
STATEMENTS OF OPERATIONS
For the Six and Three Months Ended July 31, 2009 and 2008
and for the Period from January 1, 1995 to July 31, 2009

|                                                       |  |                                    |             |                                       |    |                                                          |   |      |             |   |    |             |   |   |             |  
|------------------------------------------------------ |  | ---------------------------------- | ----------- | ------------------------------------- | -- | -------------------------------------------------------- | - | ---- | ----------- | - | -- | ----------- | - | - | ----------- | -
|                                                       |  | For the Six Months Ended
 July 31, |             | For the Three Months
 Ended
 July 31, |    | For the
 Period
 From January 1,
 1995
 to July 31, 2009 |  
|                                                       |  |                                    |             |                                       |    |                                                         
|                                                       |  | 2009                               |             | 2008                                  |    | 2009                                                     |   | 2008 |             |  
|                                                       |  |                                    |             |                                       |    |                                                          |   |      |             |   |   
|Services revenue                                       |  | $                                  | 171,538     |                                       | $  | 645,360                                                  |   | $    | 82,819      |   | $  | 369,567     |   | $ | 1,569,036   |  
|                                                       |  |                                    |             |                                       |    |                                                          |   |      |             |   |    |             |   |   |             |  
|Costs and expenses                                     |  |                                    |             |                                       |    |                                                          |   |      |             |   |    |             |   |   |             |  
|Costs of services                                      |  |                                    | (273,336    | )                                     |    | (1,221,718                                               | ) |      | (14,269     | ) |    | (761,891    | ) |   | (2,647,389  | )
|Exploration and maintenance costs                      |  |                                    | (1,673,131  | )                                     |    | (2,189,006                                               | ) |      | (265,359    | ) |    | (1,239,859  | ) |   | (10,379,285 | )
|General and administrative                             |  |                                    | (3,135,307  | )                                     |    | (2,331,128                                               | ) |      | (1,884,446  | ) |    | (984,472    | ) |   | (29,270,756 | )
|Depreciation                                           |  |                                    | (631,146    | )                                     |    | (238,586                                                 | ) |      | (300,424    | ) |    | (133,399    | ) |   | (1,616,705  | )
|                                                       |  |                                    |             |                                       |    |                                                          |   |      |             |   |    |             |   |   |             |  
|Total costs and expenses                               |  |                                    | (5,712,920  | )                                     |    | (5,980,438                                               | ) |      | (2,464,498  | ) |    | (3,119,621  | ) |   | (43,914,135 | )
|                                                       |  |                                    |             |                                       |    |                                                          |   |      |             |   |    |             |   |   |             |  
|Loss from operations                                   |  |                                    | (5,541,382  | )                                     |    | (5,335,078                                               | ) |      | (2,381,679  | ) |    | (2,750,054  | ) |   | (42,345,099 | )
|                                                       |  |                                    |             |                                       |    |                                                          |   |      |             |   |    |             |   |   |             |  
|                                                       |  |                                    |             |                                       |    |                                                          |   |      |             |   |    |             |   |   |             |  
|Other (expense)                                        |  |                                    |             |                                       |    |                                                          |   |      |             |   |    |             |   |   |             |  
|Interest income                                        |  |                                    | 45,344      |                                       |    | 22,532                                                   |   |      | 21,466      |   |    | 1,469       |   |   | 380,310     |  
|Dividend income                                        |  |                                    |             |                                       |    |                                                          |   |      |             |   |    |             |   |   | 30,188      |  
|                                                       |  |                                    |             |                                       |    |                                                          |   |      |             |   |    |             |   |   |             |  
|Gain on settlement of obligations                      |  |                                    | (87,786     | )                                     |    | 22,851                                                   |   |      |            |   |    | 22,851      |   |   | (81,221     | )
|Other income                                           |  |                                    |             |                                       |    |                                                          |   |      |             |   |    |             |   |   | 1,149,375   |  
|Adjustments to fair value of derivatives               |  |                                    |             |                                       |    |                                                          |   |      |             |   |    |             |   |   | (1,357,903  | )
|Interest expense                                       |  |                                    | (3,253,899  | )                                     |    | (155,911                                                 | ) |      | (1,764,866  | ) |    | (121,305    | ) |   | (10,029,273 | )
|Loss from joint venture                                |  |                                    |             |                                       |    |                                                          |   |      |             |   |    |             |   |   | (859,522    | )
|                                                       |  |                                    |             |                                       |    |                                                          |   |      |             |   |    |             |   |   |             |  
|Loss on sale of marketable securities                  |  |                                    |             |                                       |    |                                                          |   |      |             |   |    |             |   |   | (281,063    | )
|Bad debt expense                                       |  |                                    |             |                                       |    |                                                          |   |      |             |   |    |             |   |   | (40,374     | )
|                                                       |  |                                    |             |                                       |    |                                                          |   |      |             |   |    |             |   |   |             |  
|Loss on disposal of plant, property and
 equipment     |  |                                    |             |                                       |    |                                                          |   |      | (87,786     | ) |    |             |   |   | (275,713    | )
|Loss on disposal of bond                               |  |                                    |             |                                       |    |                                                          |   |      |             |   |    |             |   |   | (21,000     | )
|                                                       |  |                                    |             |                                       |    |                                                          |   |      |             |   |    |             |   |   |             |  
|                                                       |  |                                    |             |                                       |    |                                                          |   |      |             |   |    |             |   |   |             |  
|Total other income (expense)                           |  |                                    | (3,296,341  | )                                     |    | (110,528                                                 | ) |      | (1,831,186  | ) |    | (96,985     | ) |   | (11,386,196 | )
|                                                       |  |                                    |             |                                       |    |                                                          |   |      |             |   |    |             |   |   |             |  
|                                                       |  |                                    |             |                                       |    |                                                          |   |      |             |   |    |             |   |   |             |  
|Net loss                                               |  | $                                  | (8,837,723  | )                                     | $  | (5,445,606                                               | ) | $    | (4,212,865  | ) | $  | (2,847,039  | ) | $ | (53,731,295 | )
|                                                       |  |                                    |             |                                       |    |                                                          |   |      |             |   |    |             |   |   |             |  
|                                                       |  |                                    |             |                                       |    |                                                          |   |      |             |   |    |             |   |   |             |  
|Basic and diluted loss per share                       |  | ($                                 | 0.06        | )                                     | ($ | 0.06                                                     | ) | ($   | 0.03        | ) | ($ | 0.03        | ) |   |             |  
|                                                       |  |                                    |             |                                       |    |                                                          |   |      |             |   |    |             |   |   |             |  
|                                                       |  |                                    |             |                                       |    |                                                          |   |      |             |   |    |             |   |   |             |  
|Basic and diluted weighted-average shares
 outstanding |  |                                    | 142,764,961 |                                       |    | 94,725,487                                               |   |      | 144,396,648 |   |    | 109,455,871 |   |   |             |  
|                                                       |  |                                    |             |                                       |    |                                                          |   |      |             |   |    |             |   |   |             |  

6

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|                                                         
|---------------------------------------------------------
|FIRSTGOLD CORP.                                          
|(AN EXPLORATION STAGE COMPANY)                           
|STATEMENTS OF CASH FLOWS                                 
|For the Six Months Ended July 31, 2009 and
 2008         
|and for the Period from January 1, 1995 to
 July 31, 2009
|                                                         
|                                                         

|                                                                            |  |                                   |            |      |   |                                                         |   |   |             |  
|--------------------------------------------------------------------------- |  | --------------------------------- | ---------- | ---- | - | ------------------------------------------------------- | - | - | ----------- | -
|                                                                            |  |                                   |            |      |   | For the Period
 From January 1,
 1995 to July
 31, 2009 |  
|                                                                            |  | For the Six Months Ended July 31, |            |     
|                                                                            |  |                                   |            |     
|                                                                            |  | 2009                              |            | 2008 |   |                                                        
|                                                                            |  |                                   |            |      |   |                                                         |  
|Cash flows from operating activities                                        |  |                                   |            |      |   |                                                         |   |   |             |  
|Net loss                                                                    |  | $                                 | (8,837,723 | )    | $ | (7,632,537                                              | ) | $ | (53,731,295 | )
|Adjustments to reconcile net loss to net
 cash used in operating activities |  |                                   |            |      |   |                                                         |   |   |             |  
|Accretion of warrants issued as a debt
 discount                            |  |                                   | 914,207    |      |   | 43,278                                                  |   |   | 3,166,487   |  
|Accretion of original issue discount                                        |  |                                   | 563,849    |      |   |                                                        |   |   | 1,088,041   |  
|Accretion of debt discount                                                  |  |                                   | 506,636    |      |   | 279,438                                                 |   |   | 614,104     |  
|Accretion of beneficial conversion                                          |  |                                   |           |      |   |                                                        |   |   | 1,173,330   |  
|Adjustments to fair value of derivatives                                    |  |                                   |           |      |   | 703,992                                                 |   |   | 1,357,902   |  
|Loss from joint venture                                                     |  |                                   |           |      |   |                                                        |   |   | 859,522     |  
|Loss on sale of marketable securities                                       |  |                                   |           |      |   |                                                        |   |   | 281,063     |  
|Depreciation and amortization                                               |  |                                   | 935,923    |      |   | 210,572                                                 |   |   | 2,758,045   |  
|Loss on disposal of property, plant and
 equipment                          |  |                                   |           |      |   |                                                        |   |   | 334,927     |  
|Impairment in value of property, plant and
 equipment                       |  |                                   |           |      |   |                                                        |   |   | 807,266     |  
|Loss on disposal of bond                                                    |  |                                   |           |      |   |                                                        |   |   | 21,000      |  
|Impairment in value of Relief Canyon Mine                                   |  |                                   |           |      |   |                                                        |   |   | 3,311,672   |  
|Impairment in value of joint investments                                    |  |                                   |           |      |   |                                                        |   |   | 490,000     |  
|Bad debt                                                                    |  |                                   |           |      |   |                                                        |   |   | 40,374      |  
|Assigned value of stock and warrants
 exchanged for services                |  |                                   | 42,000     |      |   | 168,431                                                 |   |   | 2,312,632   |  
|Assigned value of stock options issue for
 compensation                     |  |                                   |           |      |   | 786,842                                                 |   |   | 321,648     |  
|Gain on write off of note payable                                           |  |                                   |           |      |   |                                                        |   |   | (7,000      | )
|Judgment loss accrued                                                       |  |                                   |           |      |   |                                                        |   |   | 250,000     |  
|(Increase) decrease in                                                      |  |                                   |            |      |   |                                                         |   |   |             |  
|Restricted cash                                                             |  |                                   | 109,279    |      |   | (423,869                                                | ) |   | (2,858,704  | )
|Receivables                                                                 |  |                                   | 76,974     |      |   | (82,074                                                 | ) |   | 161,709     |  
|Deposits                                                                    |  |                                   |           |      |   | (287,913                                                | ) |   | (2,868      | )
|Deferred reclamation costs                                                  |  |                                   |           |      |   | 39,300                                                  |   |   | 2,401,511   |  
|Prepaid expenses                                                            |  |                                   | 207,497    |      |   | (110,298                                                | ) |   | (80,583     | )
|Reclamation bonds                                                           |  |                                   |           |      |   |                                                        |   |   | 185,000     |  
|Other assets                                                                |  |                                   |           |      |   |                                                        |   |   | (1,600      | )
|Increase (decrease) in                                                      |  |                                   |            |      |   |                                                         |   |   |             |  
|Accounts payable                                                            |  |                                   | 878,573    |      |   | 2,131,808                                               |   |   | 3,140,750   |  
|Accrued expenses                                                            |  |                                   | 3,248,271  |      |   | (659,187                                                | ) |   | 5,520,092   |  
|                                                                            |  |                                   |            |      |   |                                                         |   |   |             |  
|Net cash used by operating activities                                       |  |                                   | (1,354,514 | )    |   | (4,832,217                                              | ) |   | (26,084,975 | )
|                                                                            |  |                                   |            |      |   |                                                         |   |   |             |  
|                                                                            |  |                                   |            |      |   |                                                         |   |   |             |  
|Cash flows from investing activities                                        |  |                                   |            |      |   |                                                         |   |   |             |  
|Proceeds from sale of marketable securities                                 |  |                                   |           |      |   |                                                        |   |   | 34,124      |  
|Investment in marketable securities                                         |  |                                   |           |      |   |                                                        |   |   | (315,188    | )
|Advances from shareholder                                                   |  |                                   |           |      |   |                                                        |   |   | 7,436       |  
|Contribution from joint venture partner                                     |  |                                   |           |      |   |                                                        |   |   | 775,000     |  
|Purchase of joint venture partner interest                                  |  |                                   |           |      |   |                                                        |   |   | (900,000    | )
|Capital expenditures                                                        |  |                                   | (9,925     | )    |   | (7,695,202                                              | ) |   | (18,265,255 | )
|Proceeds from disposal of property, plant
 and equipment                    |  |                                   |           |      |   |                                                        |   |   | 278,783     |  
|Investments in joint ventures                                               |  |                                   |           |      |   |                                                        |   |   | (490,000    | )
|Note receivable                                                             |  |                                   |           |      |   |                                                        |   |   | 268,333     |  
|Repayment of note receivable                                                |  |                                   |           |      |   |                                                        |   |   | (268,333    | )
|                                                                            |  |                                   |            |      |   |                                                         |   |   |             |  
|Net cash used by investing activities                                       |  |                                   | (9,925     | )    |   | (7,695,202                                              | ) |   | (18,875,100 | )
|                                                                            |  |                                   |            |      |   |                                                         |   |   |             |  
|                                                                            |  |                                   |            |      |   |                                                         |   |   |             |  
|Cash flows from financing activities                                        |  |                                   |            |      |   |                                                         |   |   |             |  
|Proceeds from the issuance of common stock                                  |  |                                   | 890,008    |      |   | 12,396,177                                              |   |   | 29,936,048  |  
|Proceeds from notes payable                                                 |  |                                   | 620,474    |      |   | 250,685                                                 |   |   | 19,813,988  |  
|Principal repayments of notes payable                                       |  |                                   | (79,791    | )    |   | (24,517                                                 | ) |   | (4,116,685  | )
|Repayment of advances to affiliate                                          |  |                                   |           |      |   |                                                        |   |   | (231,663    | )
|Deferred revenue                                                            |  |                                   |           |      |   | 137,650                                                 |   |   | 799,950     |  
|                                                                            |  |                                   |            |      |   |                                                         |   |   |             |  
|Net cash provided by financing activities                                   |  |                                   | 1,430,691  |      |   | 12,759,995                                              |   |   | 46,201,638  |  
|                                                                            |  |                                   |            |      |   |                                                         |   |   |             |  
|                                                                            |  |                                   |            |      |   |                                                         |   |   |             |  
|Net increase (decrease) in cash                                             |  | $                                 | 66,252     |      |   | 232,576                                                 |   |   | 88,605      |  
|Cash, beginning of year                                                     |  |                                   | 15,666     |      |   | 150,647                                                 |   |   | 6,687       |  
|                                                                            |  |                                   |            |      |   |                                                         |   |   |             |  
|Cash, end of year                                                           |  | $                                 | 81,918     |      | $ | 383,223                                                 |   | $ | 81,918      |  
|                                                                            |  |                                   |            |      |   |                                                         |   |   |             |  

7

---



Supplemental cash flow information for the
six months ended July 31, 2009 and 2008 and January 1, 1995 through July 31,
2009 as follows:

|                                                                                                  |  |      |        |      |                                     |   |                                                         |   |           | 
|------------------------------------------------------------------------------------------------- |  | ---- | ------ | ---- | ----------------------------------- | - | ------------------------------------------------------- | - | --------- | 
|                                                                                                  |  |      |        |      | For the Six
 Months Ended
 July 31, |   | For the Period
 From January 1,
 1995 to July
 31, 2009 |  
|                                                                                                 
|                                                                                                  |  |      |        |      |                                     |   |                                                        
|                                                                                                  |  | 2009 |        | 2008 |                                     |  
|                                                                                                  |  |      |        |      |                                     |   |                                                        
|                                                                                                  |  |      |        |      |                                     |   |                                                         |   |           | 
|Cash paid for interest                                                                            |  | $    |       |      | $                                   |  |                                                         | $ | 161,107   | 
|Cash paid for income taxes                                                                        |  | $    |       |      | $                                   |  |                                                         | $ |          | 
|                                                                                                  |  |      |        |      |                                     |   |                                                         |   |           | 
|Non Cash Investing and Financing
 Activities:                                                     |  |      |        |      |                                     |   |                                                         |   |           | 
|Conversion of related party note payable to
 common stock, including interest payable of $446,193 |  | $    |       |      | $                                   |  |                                                         | $ | 1,848,935 | 
|Conversion of convertible debentures to
 common stock, including interest of $217,151             |  | $    |       |      | $                                   |  |                                                         | $ | 4,359,609 | 
|Issuance of warrants as financing costs in
 connection with convertible debt                      |  | $    |       |      | $                                   |  |                                                         | $ | 173,114   | 
|Issuance of common stock as payment for
 settlement of liabilities                                |  | $    | 42,000 |      | $                                   |  |                                                         | $ | 81,000    | 

8

---



|                                                                                                                       |  | 
|---------------------------------------------------------------------------------------------------------------------- |  | 
|FIRSTGOLD CORP.
 (AN EXPLORATION STAGE COMPANY)
 NOTES TO FINANCIAL STATEMENTS
 For the Six Months Ended July 31, 2009 |  | 
|                                                                                                                       | 
|                                                                                                                       | 
|                                                                                                                       | 
|                                                                                                                      

|                                           |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|------------------------------------------ | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|NOTE 1 - ORGANIZATION AND LINE OF BUSINESS
|                                           |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|                                           | Firstgold Corp. has a business strategy whereby it will invest in,
 explore and if warranted, conduct mining operations of its current mining
 properties and other mineral producing properties. Firstgold is a public
 company that in the past has been engaged in the acquisition and exploration
 of gold-bearing properties in the continental United States. Currently,
 Firstgolds principal assets include various mineral leases associated with
 the Relief Canyon Mine located near Lovelock, Nevada along with various items
 of mining equipment and improvements located at that site. Firstgold has
 staked claims in anticipation of exploring on approximately 9,800 acres of
 property located in the Horse Creek, Fairview Hunter and Honorine Gold areas
 of Nevada.                                                                                                                                                                                                                                                                                 
|                                           |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|                                           | From 1995 until the beginning of 2000, Firstgold had followed the
 above described business activity focusing on the exploration and mining of
 gold and silver ore deposits. At the beginning of 2000, Firstgolds business
 strategy became focused on investing in Internet start-up companies. That
 strategy was not successful and by mid-2001 Firstgold had abandoned such
 investments. From approximately July 2001 until February 2003 Firstgold had
 been inactive. During the period of inactivity, ASDi LLC, an entity
 controlled by A. Scott Dockter who was also the Chief Operating Officer of Firstgold,
 made the necessary expenditures to maintain the current status of the Relief
 Canyon mining claims. In February 2003, Firstgold resumed its business of
 acquiring, exploring and if warranted developing its mining properties.                                                                                                                                                                                                               
|                                           |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|NOTE 2 - GOING CONCERN                    
|                                           |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|                                           | These financial statements have been prepared on a going concern
 basis. During the years ended January 31, 2009 and 2008 and the period from
 January 1, 1995 to January 31, 2009, Firstgold incurred net losses of
 approximately $14,444,225, $7,632,537, and $44,893,572, respectively. In
 addition, Firstgold has been in the exploration stage since inception and
 through July 31, 2009. Information for the six months ended July 31, 2009
 include a net loss of $8,837,723, negative cash flows from operations of
 $1,354,514 and a deficit accumulated during the exploration stage of
 $54,648,110. The Companys ability to continue as a going concern is
 dependent upon its ability to generate profitable operations in the future
 and/or to obtain the necessary financing to meet its obligations and repay
 its liabilities arising from normal business operations when they come due.
 The outcome of these matters cannot be predicted with any certainty at this
 time. Since inception, the Company has satisfied its capital needs by issuing

9

---



|                                                     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|---------------------------------------------------- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|                                                     | equity and debt securities.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|                                                     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|                                                     | Management plans to continue to provide for its capital needs during
 the year ending January 31, 2010 by issuing equity securities or incurring
 additional debt financing, with the proceeds to be used to re-establish
 mining operations at Relief Canyon as well as improve its working capital
 position. These financial statements do not include any adjustments to the
 amounts and classification of assets and liabilities that may be necessary
 should the
 Company be unable to continue as a going concern.                                                                                                                        
|                                                     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|NOTE 3 - SUMMARY OF SIGNIFICANT ACCOUNTING
 POLICIES
|                                                     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|                                                     | Basis of Presentation                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|                                                     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|                                                     | These financial statements have been prepared in accordance with the
 rules and regulations of the Securities and Exchange Commission (SEC).
 Certain information and footnotes normally included in financial statements
 prepared in accordance with generally accepted accounting principles in the
 United States of America have been condensed or omitted pursuant to these
 rules and regulations. These consolidated financial statements should be read
 in conjunction with the consolidated financial statements and the notes
 thereto included in Firstgolds Form 10-K, as filed with the SEC for the year
 ended January 31, 2009.
|                                                     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|                                                     | Exploration Stage Company                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|                                                     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|                                                     | Effective January 1, 1995 (date of inception), the Company is
 considered an exploration stage Company as defined in SFAS No. 7. The
 Companys exploration stage activities consist of the development of several
 mining properties located in Nevada. Sources of financing for these
 exploration stage activities have been primarily debt and equity financing.
 The Company has, at the present time, not paid any dividends and any
 dividends that may be paid in the future will depend upon the financial requirements
 of the Company and other relevant factors.                                                                       
|                                                     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|                                                     | Cash and Cash Equivalents                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|                                                     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|                                                     | For the purpose of the statements of cash flows, Firstgold considers
 all highly liquid investments purchased with original maturities of three
 months or less to be cash equivalents.                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|                                                     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|                                                     | Restricted Cash                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|                                                     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|                                                     | Restricted cash represents a certificate of deposit with Umpqua Bank
 to serve as collateral for a reclamation bond with the Nevada Department of
 Environmental Protection at the Relief Canyon Mine.                                                                                                                                                                                                                                                                                                                                                                                                                                             
|                                                     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|                                                     | Property and Equipment                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             

10

---



| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
| | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | Depreciation, depletion and amortization of
 mining properties, mine exploration costs and major plant facilities will be
 computed principally by the units-of-production method based on estimated
 proven and probable ore reserves once production begins. Proven and probable
 ore reserves reflect estimated quantities of ore which can be economically
 recovered in the future from known mineral deposits. Such estimates are based
 on current and projected costs and prices. Other equipment (prior to
 production, all equipment) is depreciated using the straight-line method
 principally over the estimated useful life of the respective asset.                                                                                                                                                          
| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
| | Deferred Reclamation Costs                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
| | In August 2001, the Financial Accounting Standards Board (FASB)
 issued Statement of Financial Accounting Standards (SFAS) No. 143,
 Accounting for Asset Retirement Obligations, which established a uniform
 methodology for accounting for estimated reclamation and abandonment costs.
 The statement was adopted February 1, 2003. The reclamation costs will be
 allocated to expense over the life of the related assets and will be adjusted
 for changes resulting from the passage of time and revisions to either the
 timing or amount of the original present value estimate.                                                                                                                                                                                                                            
| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
| | Prior to adoption of SFAS No. 143, estimated future reclamation costs
 were based principally on legal and regulatory requirements. Such costs
 related to active mines were accrued and charged over the expected operating
 lives of the mines using the Units Of Production method based on proven and
 probable reserves. Future remediation costs for inactive mines were accrued
 based on managements best estimate at the end of each period of the
 undiscounted costs expected to be incurred at a site. Such cost estimates
 included, where applicable, ongoing care, maintenance and monitoring costs.
 Changes in estimates at inactive mines were reflected in earnings in the
 period an estimate was revised.                                                                                             
| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
| | Exploration Costs                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
| | Exploration costs are expensed as incurred. All costs related to
 property acquisitions are capitalized.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
| | Mine Development Costs                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
| | Mine development costs consist of all costs associated with bringing
 mines into production, to develop new ore bodies and to develop mine areas
 substantially in advance of current production. The decision to develop a
 mine is based on assessment of the commercial viability of the property and
 the availability of financing. Once the decision to proceed to development is
 made, development and other expenditures relating to the project will be
 deferred and carried at cost with the intention that these will be depleted
 by charges against earnings from future mining operations. No depreciation
 will be charged against the property until commercial production commences.
 After a mine has been brought into commercial production, any additional work
 on that property will be expensed as

11

---



| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
| | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | incurred, except for large development programs, which will be
 deferred and depleted.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
| | Financing Costs                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
| | Financing costs, including interest, are capitalized when they arise
 from indebtedness incurred to finance development and construction activities
 on properties that are not yet subject to depreciation or depletion.
 Capitalization is based upon the actual interest on debt specifically incurred
 or on the average borrowing rate for all other debt except where shares are
 issued to fund the cost of the project.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
| | Depreciation, Depletion and Amortization                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
| | Assets other than mining properties and mineral rights are
 depreciated using the straight-line method over their estimated useful lives.
 Capitalized development costs are amortized on the units of production method
 considering proven and probable reserves. Depreciation and depletion rates
 are subject to periodic review to ensure that asset costs are amortized over
 their useful lives.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
| | Impairment                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
| | Mining projects and properties are reviewed for impairment whenever
 events or changes in circumstances indicate that the carrying amount of these
 assets may not be recoverable. If estimated future cash flows expected to
 result from the use of the mining project or property and its eventual
 disposition are less than the carrying amount, impairment is recognized based
 on the estimated fair value of the mining project or property. Fair value
 generally is based on the present value of estimated future net cash flows
 for each mining project or property, calculated using estimates of proven and
 probable mineable reserves, geological resources, future prices, operating
 costs, capital requirements and reclamation costs. A provision for impairment
 in valuation of development costs and property, plant and equipment amounted
 to $800,000 for the year ended January 31, 2002 and was charged to operating
 expense. After these adjustments all development costs and property, plant
 and equipment have been fully written off.
| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
| | Managements estimates of future cash flows are subject to risks and
 uncertainties. Therefore, it is reasonably possible that changes could occur
 which may affect the recoverability of the Companys investment in mineral
 properties.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
| | Risks Associated with Gold Mining                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
| | The business of gold mining is subject to certain types of risks,
 including environmental hazards, industrial accidents, and theft. While the
 Company maintains insurance consistent with industry practice, it is not
 possible to insure against all risks associated with the mining business, or
 prudent to assume that insurance will continue to be available at a
 reasonable cost. The Company has not obtained environmental liability
 insurance because such coverage is not                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               

12

---



| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
| | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | considered by management to be cost effective.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
| | Reclamation Costs                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
| | Reclamation costs and related accrued liabilities, which are based on
 the Companys interpretation of current environmental and regulatory
 requirements, are accrued and expensed, upon determination.                                                                                                                                                                                                                                                                                                                                                                                                                                                             
| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
| | Based on current environmental regulations and known reclamation
 requirements, management has included its best estimates of these obligations
 in its reclamation accruals. However, it is reasonably possible that the
 Companys best estimates of its ultimate reclamation liabilities could change
 as a result of changes in regulations or cost estimates.                                                                                                                                                                                                                                                                                                   
| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
| | Valuation of Derivative Instruments                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
| | FAS No. 133 Accounting for Derivative Instruments and Hedging
 Activities requires
 bifurcation of embedded derivative instruments and measurement of their fair
 value for accounting purposes. In determining the appropriate fair value, the
 Company uses the Black Scholes model as a valuation technique. Derivative
 liabilities are adjusted to reflect fair value at each period end, with any
 increase or decrease in the fair value being recorded in results of
 operations as Adjustments to Fair Value of Derivatives. In addition, the fair
 values of freestanding derivative instruments such as warrants are valued
 using Black Scholes models.
| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
| | Revenue Recognition                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
| | Revenues will be recognized when deliveries of gold are made, title
 and risk of loss passes to the buyer and collectibility is reasonably
 assured. Deferred revenue represents non-refundable cash received in exchange
 for royalties on net smelter returns on the Relief Canyon Mine. Deferred
 revenue will be amortized to earnings based on estimated production in
 accordance with the royalty agreement.                                                                                                                                                                                                                                                  
| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
| | Fair Value of Financial Instruments                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
| | The carrying amount reflected in the balance sheets for cash, cash
 equivalents, loans and notes payable approximate the respective fair values
 due to the short maturities of these instruments. Available-for-sale
 marketable securities and hedging instruments also are recorded at fair value
 in the balance sheets. The fair values for held-to-maturity marketable debt
 securities, investments, receivables, and long-term debt are based primarily
 on quoted market prices for those or similar instruments.                                                                                                                                           
| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
| | Comprehensive Income                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
| | The Company utilizes SFAS No. 130, Reporting Comprehensive Income.
 This statement establishes standards for reporting comprehensive income and
 its components in a financial statement. Comprehensive income as defined
 includes                                                                                                                                                                                                                                                                                                                                                                                                                                

13

---



| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
| | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | all changes in equity (net assets) during a period from non-owner
 sources. Examples of items to be included in comprehensive income, which are
 excluded from net income, include foreign currency translation adjustments,
 minimum pension liability adjustments, and unrealized gains and losses on
 available-for-sale marketable securities. Comprehensive income is presented
 in the Companys financial statements since the Company did have unrealized
 gain (loss) from changes in equity from available-for-sale marketable
 securities.                                                                                                                                                                                                                  
| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
| | Income Taxes                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
| | The Company accounts for income taxes under the liability method,
 which requires the recognition of deferred tax assets and liabilities for the
 expected future tax consequences of events that have been included in the
 financial statements or tax returns. Under this method, deferred income taxes
 are recognized for the tax consequences in future years of differences
 between the tax basis of assets and liabilities and their financial reporting
 amounts at each period end based on enacted tax laws and statutory tax rates
 applicable to the periods in which the differences are expected to affect
 taxable income. Valuation allowances are established, when necessary, to reduce
 deferred tax assets to the amount expected to be realized.
| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
| | As of January 31, 2009, the deferred tax assets related to the
 Companys net operating loss carry-forwards are fully reserved. Due to the
 provisions of Internal Revenue Code Section 382, the Company may not have any
 net operating loss carry-forwards available to offset financial statement or
 tax return taxable income in future periods as a result of a change in
 control involving 50 percentage points or more of the issued and outstanding securities
 of the Company.                                                                                                                                                                                                                                                                              
| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
| | Estimates                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
| | The preparation of financial statements requires management to make
 estimates and assumptions that affect the reported amounts of assets and
 liabilities and disclosure of contingent assets and liabilities at the date
 of the financial statements and the reported amounts of revenue and expenses
 during the reporting period. Actual results could differ from those
 estimates.                                                                                                                                                                                                                                                                                                                                                                              
| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
| | Loss Per Share                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
| | The Company utilizes SFAS No. 128, Earnings per Share. Basic loss
 per share is computed by dividing loss available to common shareholders by
 the weighted-average number of common shares outstanding. Diluted loss per
 share is computed similar to basic loss per share except that the denominator
 is increased to include the number of additional common shares that would
 have been outstanding if the potential common shares had been issued and if
 the additional common shares were dilutive. Common equivalent shares are
 excluded from the computation if their effect is anti-dilutive.                                                                                                                                                          
| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
| | The following common stock equivalents were excluded from the
 calculation of                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          

14

---



| |                                                                         
| | ------------------------------------------------------------------------
| | diluted loss
per share since their effect would have been anti-dilutive:

| |          |  |      |            |      |  |            |  | 
| | -------- |  | ---- | ---------- | ---- |  | ---------- |  | 
| |          |  | 2009 |            | 2008 |  |           
| |          |  |      |            |      |  |           
| |          |  |      |            |      |  |            |  | 
| | Warrants |  |      | 31,672,164 |      |  | 64,582,841 |  | 

|                                |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|------------------------------- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|                                | Concentrations of Credit Risk                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|                                |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|                                | Financial instruments which potentially subject the Company to
concentrations of credit risk consist of cash and cash equivalents. The
Company places its cash and cash equivalents with high credit, quality
financial institutions. At times, such cash and cash equivalents may be in
excess of the Federal Deposit Insurance Corporation insurance limit of
$250,000. The Company has not experienced any losses in such accounts and
believes it is not exposed to any significant credit risk on cash and cash
equivalents.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|                                |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|                                | Recent Accounting Pronouncements                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|                                |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|                                | In December 2007, the FASB released FAS 141R, Business Combinations
and FAS 160, Non-controlling Interests in Consolidated Financial
Statements. Both standards will be effective for transactions that occur
after January 1, 2009. FAS 141R applies to all business combinations and will
require the acquiring entity to recognize the assets and liabilities acquired
at their respective fair value. This standard changes the accounting for
business combinations in several areas. If we complete an acquisition after the
effective date of FAS 141R, some of these changes could result in increased
volatility in our results of operations and financial position. For example,
transaction costs, which are currently capitalized in a business combination,
will be expensed as incurred. Additionally, pre-acquisition contingencies
(such as in-process lawsuits acquired) and contingent consideration (such as
additional consideration contingent on specified events in the future) will
be recorded at fair value at the acquisition date, with subsequent changes in
fair value reflected in our results of operations. Under current accounting
guidance, adjustments to these contingencies are reflected in the allocation
of purchase price if they occur within a certain period of time after the acquisition
date.
|                                |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|NOTE 4 - PROPERTY AND EQUIPMENT

| |                                     |  |             |            |               |   |            |   | 
| | ----------------------------------- |  | ----------- | ---------- | ------------- | - | ---------- | - | 
| |                                     |  | At July 31, |            | At January 31 |   |           
| |                                     |  |             |            |               |   |           
| |                                     |  | 2009        |            | 2009          |   |           
| |                                     |  |             |            |               |   |           
| |                                     |  |             |            |               |   |            |   | 
| | Land                                |  | $           | 266,977    |               | $ | 266,977    |   | 
| | Buildings                           |  |             | 433,952    |               |   | 433,952    |   | 
| | Mining equipment                    |  |             | 2,499,287  |               |   | 2,922,637  |   | 
| | Crushing system                     |  |             | 2,609,183  |               |   | 2,609,183  |   | 
| | Process plant                       |  |             | 4,263,925  |               |   | 4,263,925  |   | 
| | Site costs                          |  |             | 1,542,885  |               |   | 1,535,882  |   | 
| | Lab & equipment                     |  |             | 1,165,855  |               |   | 1,162,934  |   | 
| | Other                               |  |             | 1,269,018  |               |   | 1,326,717  |   | 
| | Asset retirement costs              |  |             | 2,866,989  |               |   | 2,866,989  |   | 
| |                                     |  |             |            |               |   |            |   | 
| | Total property, plant and equipment |  |             | 16,918,071 |               |   | 17,389,196 |   | 
| | Less accumulated depreciation       |  |             | (1,531,333 | )             |   | (936,744   | ) | 
| |                                     |  |             |            |               |   |            |   | 
| | Total                               |  | $           | 15,386,738 |               | $ | 16,452,452 |   | 
| |                                     |  |             |            |               |   |            |   | 

15

---



NOTE 5 - NOTES PAYABLE

| |                                                         
| | --------------------------------------------------------
| | Notes
payable consist of the following at July 31, 2009:

| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  |  |   |           | 
| | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------ |  | - | --------- | 
| | Equipment
notes payable                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |  | $ | 138,674   | 
| | The fourth
bears interest at 9% and is due December 2011. The fifth note bears interest
at 7.5% and is due June 2013. The loan is secured by various items of
machinery and equipment.                                                                                                                                                                                                                                                                                                           |  |   |           | 
| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  |  |   |           | 
| | Mortgage
notes payable                                                                                                                                                                                                                                                                                                                                                                                                                                                                           |  |   | 313,153   | 
| | The first
note of $245,653 bears interest at 6.75% with monthly principal and interest
payments and is due in September 2013. The second note of $67,500 bears
interest at 6.75% and is due December 31, 2010 with accrued interest and
principal due at maturity. If Firstgold completes required water line
improvements to the property by the due date of the second note then the
second note will be forgiven. The loans are secured by a building and five
acres of land in Lovelock, NV. |  |   |           | 
| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  |  |   |           | 
| | Short term
notes payable                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |  |   | 809,274   | 
| | In November
2008 Firstgold entered into a note payable with a six month term and bears
interest at 50% per annum. In May 2009 Firstgold entered into promissory
notes due in one year that bear interest at 18%.                                                                                                                                                                                                                                                                                 |  |   |           | 
| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  |  |   |           | 
| | Promissory
note due March 2010 with interest at 8%                                                                                                                                                                                                                                                                                                                                                                                                                                               |  |   | 500,000   | 
| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  |  |   |           | 
| | Insurance
premium notes payable                                                                                                                                                                                                                                                                                                                                                                                                                                                                  |  |   | 24,731    | 
| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  |  |   |           | 
| | The note
bears interest at 9.6%, is payable monthly and is due November 2009.                                                                                                                                                                                                                                                                                                                                                                                                                    |  |   |           | 
| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  |  |   |           | 
| | Total notes
payable                                                                                                                                                                                                                                                                                                                                                                                                                                                                              |  | $ | 1,780,732 | 
| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  |  |   |           | 

| |                                                                                                                                                                                                                                        
| | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | Firstgold
recorded interest expense of $1,764,866 and $3,253,899 for the three months
and six months ended July 31, 2009 compared to interest expense of $121,305
and $155,911 for the three months and six months ended July 31, 2008.

16

---



NOTE 6  CONVERTIBLE DEBENTURES AND SENIOR
SECURED NOTES

| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
| | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | October 2006
 Convertible Debentures                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
| | In October 2006, Firstgold issued convertible debentures in the
 aggregate principal amount of $650,000 and bearing interest of 8% per annum.
 The Debentures and accrued interest are convertible into shares of Firstgold
 common stock at a conversion rate of $0.405 per share. The Debentures are due
 and payable three years from the date of issue unless they are converted into
 shares of the Companys common stock or are repaid prior to their expiration
 date. Additionally, the investors were issued warrants to purchase an
 aggregate of 746,843 shares of Firstgold common stock exercisable at $0.45
 per warrant. The warrants were issued as financing costs and total deferred
 financing cost of $173,114 was recorded in relation to this debt.                                                                                                                                                                                                                                                                                                                                                                              
| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
| | August/September
 2008 Senior Secured Promissory Notes                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
| | On August 7, 2008, Firstgold Corp. (the Company) entered into a
 Note and Warrant Purchase Agreement (the Agreement) with Platinum Long-Term
 Growth, LLC and Lakewood Group, LLC, two US-based investment funds (the
 Lenders). Pursuant to the Agreement, the Lenders will fund up to
 $15,750,000 in Senior Secured Promissory Notes. Funding of the loan will
 occur in five tranches of which the first occurred at the initial closing on
 August 7, 2008 in the aggregate amount of $6,742,625 (the Initial Note
 Amount). A first interim funding occurred August 27, 2008 in the amount of
 $472,973. A second interim funding occurred September 10, 2008 in the amount
 of $1,351,351. The second close funding occurred September 29, 2008 in the
 amount of $3,433,051. Three additional tranches of $1,250,000 each will be
 available during the months of November and December, 2008 and January 2009 subject
 to the Company achieving certain operational conditions. The loans bear an
 interest rate of 4% per annum with interest payments commencing in September,
 2008. The loans are due and payable on March 1, 2010.
| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
| | During the time that any debt remains owed to the Lenders the
 Agreement limits the Companys ability to incur any additional indebtedness
 and, the Company must obtain the Lenders consent to enter into certain
 future transactions including any future merger, sale of a substantial
 portion of its assets or becoming involved in any partnership or joint
 venture.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
| | In conjunction with the making of the loan, the lenders were issued,
 on a pro rata basis, Warrants to purchase up to 15,000,000 shares of the
 Companys common stock at an exercise price of $.4357 cents per share which
 may be adjusted downward based on future market conditions. The Warrants have
 a term of 3 years. The Warrants also provide for a Put Right in which the
 Warrant holder after August 7, 2009 may require the Company to repurchase the
 Warrants at a redemption price of $.30 per Warrant. The Put Right is
 exercisable for a period of                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 

17

---



|                                       |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|-------------------------------------- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|                                       | one year.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|                                       |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|                                       | The cost of the loan transaction includes an original issue discount
 of 15% on each note amount plus a 4% origination fee and 7% brokers
 commission.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|                                       |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|                                       | In July 2009 Firstgold entered into a Binding Offer Letter and
 certain implementing agreements, documenting an agreement in principle with a
 new investor, to acquire the two currently outstanding senior secured
 promissory notes. Among other things, the investor would assume the security
 interests and title liens currently held by the existing senior secured
 lenders thus making the investor Firstgolds primary secured lender. As part
 of the transaction, the investor has also agreed to subscribe for common
 shares of Firstgold representing 51% of the outstanding common shares (after
 giving effect to the subscription) for US $9,500,000 and has also agreed to
 provide a US $5,500,000 loan facility to Firstgold to fund working capital.
 The proposed transaction is subject to a number of conditions, including
 completion of due diligence by the investor to its satisfaction, negotiation
 and execution of definitive agreements and documents contemplated by the
 transaction, and obtaining all required government, regulatory and
 shareholder approvals. Pre-loan funding representing an initial deposit
 provided for in the Binding Offer Letter was received on July 16, 2009. Upon
 closing of the transaction, the current secured lenders have agreed to drop
 all legal actions against the Company and its officers. On September 23, 2009
 the new investor and Firstgold entered into a Letter of Undertakings which,
 among other things, extends the closing to December 1, 2009.
|                                       |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|NOTE 7 - COMMITMENTS AND CONTINGENCIES
|                                       |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|                                       | Except for the advance royalty and rent payments noted below, the
 Company is not obligated under any capital leases or non-cancelable operating
 leases with initial or remaining lease terms in excess of one year as of
 July 31, 2009. However, minimum annual royalty payments are required to
 retain the lease rights to the Companys properties.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|                                       |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|                                       | Relief
 Canyon Mine                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|                                       |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|                                       | The Company purchased the Relief Canyon Mine from J.D. Welsh
 Associates (Welsh) in January 1995. The mine consisted of 39 claims and a
 lease for access to an additional 800 acres contiguous to the claims. During
 1997, the Company staked an additional 402 claims. Subsequent to January 31,
 1998, the Company reduced the total claims to 50 (approximately 1,000 acres).
 The annual payment to maintain these claims is $5,000. As part of the
 original purchase of Relief Canyon Mine, Welsh assigned the lease from Santa
 Fe Gold Corporation (Santa Fe) to the Company. The lease granted Santa Fe the
 sole right of approval of transfer to any subsequent owner of the Relief
 Canyon Mine. Santa Fe had accepted lease and minimum royalty payments from
 the Company, but has declined to approve the transfer. Due to Welshs
 inability to transfer the Santa Fe lease, the original purchase price of $500,000
 for Relief Canyon Mine was                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             

18

---



| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
| | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | reduced by
 $50,000 in 1996 to $450,000.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
| | Subsequent to January 31, 1998, the lease was terminated by Santa Fe.
 Management believes loss of the Santa Fe lease will have no material adverse
 affect on the remaining operations of the mine operation or the financial
 position of the Company.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
| | During 1996, Repadre Capital Corporation (Repadre) purchased for
 $500,000 a net smelter return royalty (Repadre Royalty). Repadre was to
 receive a 1.5% royalty from production at each of the Relief Canyon Mine and
 Mission Mines. In July 1997, an additional $300,000 was paid by Repadre for
 an additional 1% royalty from the Relief Canyon Mine. In October, 1997, when
 the Mission Mine lease was terminated, Repadre exercised its option to
 transfer the Repadre Royalty solely to the Relief Canyon Mine resulting in a
 total 4% royalty. The total amount received of $800,000 has been recorded as
 deferred revenue in the accompanying financial statements.                                                                                                                                                                                                                                                                                                                                                         
| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
| | Litigation                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
| | On February 8, 2007, a complaint was filed against ASDi, LLC,
 Crescent Red Caps LLC, Firstgold, and Scott Dockter by the Lessors of the
 Crescent Valley and Red Caps mining properties. The complaint was filed in
 the Sixth Judicial District Court of Lander County, Nevada (Case No. 9661).
 In the complaint the plaintiffs allege that ASDi, LLC wrongfully assigned its
 lessee rights in the Crescent Valley and Red Caps mining properties to
 Crescent Red Caps LLC (of which Firstgold is the Managing Member). In late
 March, 2008 the parties reached a settlement agreement and the case was
 dismissed by the Court on April 4, 2008. As a result of the Settlement,
 Firstgold paid $150,000 to Plaintiffs and Firstgold, ASDi LLC and Crescent
 Red Caps LLC relinquished all right, title and interest in the Red Caps and
 Crescent Valley leases to the Plaintiffs. Consequently, Firstgold no longer
 has any interest in these leases and will not pursue any further exploration
 activity on such leased property.
| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
| | On September 24, 2007, a complaint was served on Firstgold by Swartz
 Private Equity, LLC. The complaint was filed in the District Court for the
 Western District of New York (Case No. 07CV6447). In the complaint, plaintiff
 alleges that pursuant to an Investment Agreement dated October 4, 2000, and
 entered into with Firstgolds former management, it is entitled to the
 exercise of certain warrants in the amount of 1,911,106 shares of Firstgold
 common stock or the equivalent cash value of $0.69 per share and a
 termination fee of $200,000. Firstgold filed an answer to the complaint on
 December 3, 2007 and expects to vigorously defend this action. The lawsuit is
 now in the discovery phase.                                                                                                                                                                                                                                                                                                                
| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
| | On January 30, 2008, a complaint was served on Firstgold by Park
 Avenue Consulting Group, Inc. The complaint was filed in the Supreme Court of
 the State of New York but was subsequently removed to the Federal District
 Court for the Southern District of New York (Case No. 08CV01850). In the
 complaint,                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            

19

---



|                                |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|------------------------------- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|                                | plaintiff alleges that pursuant to a Retainer Agreement entered into
 on September 1, 2000, it is entitled to $100,000 in retainer fees, $43,874 in
 expenses, and 850,000 shares of common stock during the term of the
 agreement. In late October 2008 the parties reached a settlement agreement
 with an amendment to the settlement agreement reached in July 2009. As a
 result of the Settlement, Firstgold is to pay to the Plaintiff $225,000 cash
 of which $50,000 has been paid and $175,000 remains outstanding as of January
 31, 2009; issue 1,900,000 shares of common stock and issue 250,000 warrants
 to purchase shares of common stock at a price of $0.4357 for a term of 3
 years. As of July 31, 2009 a total of $378,000 has been recognized as
 expense, which consists of the $225,000 cash settlement and $153,000 as the
 fair value of the stock on the date issued. Additionally $30,188 was
 accounted for as both a debit and credit to additional paid in capital for
 the fair value of the warrants issued under the Black-Scholes option pricing
 model.
|                                |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|                                | The Company is involved in various other claims and legal actions
 arising in the ordinary course of business. In the opinion of management, the
 ultimate dispositions of these matters will not have a material adverse
 effect on the Companys financial position, results of operations or
 liquidity.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|                                |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|NOTE 8 -
 SHAREHOLDERS SURPLUS
|                                |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|                                | Common Stock                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|                                |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|                                | In February 2009 warrants to purchase 2,080,000 shares of common
 stock were exercised at an exercise price of $0.15 per share.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|                                |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|                                | In March 2009 warrants to purchase 4,088,933 shares of common stock
 were exercised at an exercise price of $0.15 per share.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|                                |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|                                | In April 2009 the two senior secured lenders converted $72,414 of
 accrued interest into 487,758 shares of common stock at a price of $0.145 per
 share.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|                                |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|                                | In June 2009 a convertible note holder converted outstanding
 principal and accrued interest plus another short term note payable totaling
 $302,564 into 2,086,653 shares of common stock at a price of $0.145 per
 share.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   

20

---



| |                                                                                            
| | -------------------------------------------------------------------------------------------
| | Warrants                                                                                   
| |                                                                                            
| | The following table presents warrant activity from January 31, 2009
 through July 31, 2009:

|                              |  |                  |            |                               |   |       |  
|----------------------------- |  | ---------------- | ---------- | ----------------------------- | - | ----- | -
|                              |  | Numberof
 Shares |            | Weighted-AverageExercisePrice |  
|                              |  |                  |            |                               |  
|Outstanding,
 January31, 2009 |  |                  | 38,421,097 |                               | $ | 0.53  |  
|Exercised                     |  |                  | (6,168,933 | )                             | $ | (0.15 | )
|Expired                       |  |                  | (580,000   | )                             | $ | (0.39 | )
|Granted                       |  |                  |           |                               | $ |      |  
|                              |  |                  |            |                               |   |       |  
|Outstanding,
 July 31, 2009   |  |                  | 31,672,164 |                               | $ | 0.61  |  
|                              |  |                  |            |                               |   |       |  
|                              |  |                  |            |                               |   |       |  
|Exercisable,
 July 31, 2009   |  |                  | 31,672,164 |                               | $ | 0.61  |  
|                              |  |                  |            |                               |   |       |  

| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
| | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | Stock options                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
| | The 2006 Plan provides for the issuance of non-qualified or incentive
 stock options to employees, non-employee members of the board and
 consultants. The exercise price per share is not to be less than the fair
 market value per share of the Companys common stock on the date of grant.
 The Board of Directors has the discretion to determine the vesting schedule.
 Options may be either immediately exercisable or in installments, but
 generally vest over a three-year period from the date of grant. In the event
 the holder ceases to be employed by the Company, all unvested options
 terminate and all vested installment options may be exercised within an
 installment period following termination. In general, options expire ten
 years from the date of grant. Stockholders voting at the 2007 Annual
 Stockholders meeting held on September 20, 2007 approved an increase in the
 shares issuable under the 2006 Plan to a total of 10,000,000.
| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
| | Effective February 1, 2006, the Company adopted Statement of
 Financial Accounting Standards (SFAS) No. 123(R), Share-Based
 Payment (SFAS 123(R)), which requires the measurement and recognition of
 compensation expense for all share-based payment awards made to employees and
 directors, including stock options based on their fair values. Firstgold had
 not previously issued any stock options prior to adoption of the 2006 Plan.
 In March 2005, the SEC issued Staff Accounting Bulletin
 No. 107 (SAB 107) to provide guidance on SFAS 123(R). The Company
 has applied SAB 107 in its adoption of SFAS 123(R).                                                                                                                                                                                                                                                                                                                                              
| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
| | The Company adopted SFAS 123(R) using the modified prospective
 transition method as of and for the three months ended April 30, 2008. In
 accordance with the modified prospective transition method, the Companys
 financial statements for prior periods have not been restated to reflect, and
 do not include, the impact of SFAS 123(R). Share-based compensation expense
 recognized is based on the value of the portion of share-based payment awards
 that is ultimately expected to vest. Share-based compensation expense
 recognized in the Companys Statement of Operations during the three months
 ended April 30, 2008 includes compensation expense for share-based
 payment awards granted during the current fiscal year.                                                                                                                                                                                                                               

21

---





| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
| | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | In conjunction with the adoption of SFAS 123(R), the Company elected
 to attribute the value of share-based compensation to expense using the
 straight-line method. Share-based compensation expense related to stock
 options and restricted stock grants was $59,311 for the three months ended
 April 30, 2008, and was recorded in the financial statements as operating
 expense.                                                                                                                                                           
| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
| | As stock-based compensation expense recognized in the consolidated
 statement of operations pursuant to SFAS No. 123(R) is based on awards
 ultimately expected to vest, expense for grants beginning upon adoption of
 SFAS No. 123(R) on February 1, 2006 will be reduced for estimated
 forfeitures. SFAS No. 123(R) requires forfeitures to be estimated at the time
 of grant and revised, if necessary, in subsequent periods if actual
 forfeitures differ from those estimates. Forfeitures are estimated based on
 historical experience.
| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
| | A summary of the Companys stock option activity is as follows:                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   

|                                    |  |             |            |                                  |   |                                 |  |   |   | 
|----------------------------------- |  | ----------- | ---------- | -------------------------------- | - | ------------------------------- |  | - | - | 
|                                    |  | # of Shares |            | Weighted 
 Ave.
 Exercise
 Price |   | Aggre-
 gate 
 Intrinsic
 Value | 
|                                    |  |             |            |                                  |   |                                 | 
|                                    |  |             |            |                                  |   |                                 |  |   |   | 
|Outstanding
 as of January 31, 2009 |  |             | 5,793,999  |                                  | $ | 0.61                            |  | $ | 0 | 
|Granted                             |  |             | 0          |                                  | $ | 0.00                            |  |   |   | 
|Exercised                           |  |             | 0          |                                  | $ | 0.00                            |  |   |   | 
|Cancelled                           |  |             | (1,756,935 | )                                | $ | 0.00                            |  |   |   | 
|                                    |  |             |            |                                  |   |                                 |  |   |   | 
|                                    |  |             |            |                                  |   |                                 |  |   |   | 
|Outstanding
 as of July 31, 2009    |  |             | 4,037,064  |                                  | $ | 0.58                            |  | $ | 0 | 
|                                    |  |             |            |                                  |   |                                 |  |   |   | 
|                                    |  |             |            |                                  |   |                                 |  |   |   | 
|Exercisable
 as of July 31, 2009    |  |             | 3,643,532  |                                  | $ | 0.58                            |  | $ | 0 | 
|                                    |  |             |            |                                  |   |                                 |  |   |   | 

NOTE 9  SUBSEQUENT EVENTS

| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
| | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | In September 2009 six lenders loaned Firstgold $600,000. The loans
 bear interest of 12%, with principal and accrued interest due in one year.
 The loans are convertible into common shares of Firstgold at a conversion
 price of $0.15 per share. Additionally the lenders received a right to
 purchase from future gold production of Firstgold gold at $500 per ounce for
 every $200 advanced by the lenders. Accordingly the lenders can purchase in
 total up to 3,000 ounces of gold from future production.
| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
| | In September 2009 a convertible note holder converted outstanding
 principal and accrued interest and outstanding warrants totaling $503,885
 into 13,858,619 shares of common stock at a price of $0.0363 per share.                                                                                                                                                                                                                                                                                                 

22

---



| |                                                                                                                                                                                                                                                                          
| | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | In September 2009 a promissory note holder converted outstanding
 principal totaling $70,703 plus options to purchase 1,871 ounces of gold from
 future production of Firstgold into 16,384,717 shares of common stock at a
 price of $0.043 per share.                  
| |                                                                                                                                                                                                                                                                          
| | In September 2009 a promissory note holder converted outstanding
 principal and accrued interest totaling $115,000 plus options to purchase 575
 ounces of gold from future production of Firstgold into 6,900,000 shares of
 common stock at a price of $0.05 per share.

23

---



|        |                                                            
|------- | -----------------------------------------------------------
|ITEM 2. | MANAGEMENTS DISCUSSION AND ANALYSIS OR PLAN OF
 OPERATIONS

Caution About Forward-Looking Statements

This Form 10-Q includes forward-looking statements about future
financial results, future business changes and other events that havent yet
occurred. For example, statements like Firstgold expects, anticipates or
believes are forward-looking statements. Investors should be aware that
actual results may differ materially from Firstgolds expressed expectations
because of risks and uncertainties about the future. Firstgold does not
undertake to update the information in this Form 10-Q if any forward-looking
statement later turns out to be inaccurate. Details about risks affecting
various aspects of Firstgolds business are discussed in Firstgolds Form 10-K
as well as throughout this Form 10-Q and should be considered carefully.

Overview of Operations

We are an exploration-stage company engaged in the acquisition,
exploration and, if warranted, development of various mining properties located
in the State of Nevada. We are currently conducting a comprehensive exploration
and development program on various mineral leases associated with our Relief
Canyon Mine property located near Lovelock, Nevada. The Relief Canyon Mine
Property consists of 166 claims including 120 mill site claims and 46
unpatented mining claims. Since February 1, 2007 we have completed drilling 83
reverse circulation drill holes. We have also drilled a total of 57 sonic holes
in the existing heap leach pads to assess the economic potential of
reprocessing the ore and extracting any remaining gold. These drill results
will be added to the historic drill hole database to help develop a new mining
plan for Relief Canyon Mine property.

In preparation for the resumption of ore processing at the Relief
Canyon Mine, on August 7, 2007 we received an Approval of the Relief Canyon Mine Heap
reprocessing amendment to the Plan of Operations from the Bureau of Land
Management (BLM). In conjunction with the BLM action, Firstgold increased its
posted reclamation bond to $2.8 million with the BLM.

On August 16, 2008 an Amended Reclamation Permit No. 264 issued by
the Nevada Division of Environmental Protection (NDEP) became final. In
addition, Firstgold has recently received its Water Pollution Control Permit
and Air quality Permit from the NDEP.

The above approvals and permits allow Firstgold to begin construction
of a new heap leach pad and to construct and operate an ADR Process Plant and
crushing facility at the Relief Canyon Mine site. On December 15, 2008 we
completed the new heap leach pad and on December 16, 2008 commenced stacking
ore on the pad. We began reprocessing material on existing heaps in November,
2008 and began applying cyanide solution to the material on our heap leach pads
in February, 2009. As a result of the application of the

24

---



cyanide solution, the resulting solution began flowing through the
recently completed processing facility and on March 5, 2009 the first carbon
filters were extracted and shipped off-site for processing.

We have conducted preliminary sampling of approximately 4,200 acres of
potentially mineralized ground in the Horse Creek area located approximately
100 miles northeast of Reno, Nevada. During the course of the property
evaluation, rock chip samples were collected showing the potential presence of
intrusion-related mineral systems. During the third quarter we commenced the
extensive mapping of the areas bedrock geology. Additionally, we plan to
conduct an airborne geophysical survey to map the magnetic character of the
rocks. Geochemical exploration efforts continued with more rock chip sampling
as well as an in-depth soil sampling survey.

On January 11, 2008 we secured claims on approximately 2,300 acres of
potentially mineralized ground near Fairview, Nevada referred to as the
Fairview-Hunter property. We are conducting preliminary sampling of the area.
During the course of the property evaluation, rock chip samples were collected.
The next phase of this project will be to conduct extensive mapping of the
areas bedrock geology. Additionally, we plan to conduct an airborne
geophysical survey to map the magnetic character of the rocks. Geochemical
exploration efforts will continue with more rock chip sampling as well as an
in-depth soil sampling survey.

On February 22, 2008, we secured claims on approximately 3,300 acres of
potentially mineralized ground north of Winnemucca, Nevada referred to as the
Honorine Gold property. We are conducting preliminary sampling of the area.
During the course of the property evaluation, rock chip samples were collected.
The next phase of this project will be to conduct extensive mapping of the
areas bedrock geology. We completed the initial sampling and 6 drill holes on
the project. Drill results from this first round of drilling are expected only
to provide basic geologic information and direction for future drill work.
Additionally, we plan to conduct an airborne geophysical survey to map the
magnetic character of the rocks. Geochemical exploration efforts will continue
with more rock chip sampling as well as an in-depth soil sampling survey.

In July 2008, Firstgold opened a full service metals and mineral assay
laboratory in leased buildings located in Lovelock, Nevada. The laboratory will
process mineral samples from Firstgolds Relief Canyon Mine, other Firstgold
exploration properties and provide excess capacity to process mined samples
from other outside mining and exploration companies.

Restructuring Transaction

On July 16, 2009 we entered into a Binding Offer Letter with Northwest
Non-Ferrous International Investment Company, Limited (Northwest) which has
its headquarters in Xian Shaanxi Province, China. The Binding Offer Letter was
amended on August 7, 2009. Pursuant to the Binding Offer Letter, the parties
have agreed to prepare and enter into definitive agreements having an aggregate
value of approximately $26,500,000 and to make certain fundamental changes to
Firstgolds Certificate of Incorporation and

25

---



Bylaws to give effect to the Restructure transaction which collectively
are referred to herein as the Restructuring. The capital infusion by
Northwest will consist of three components. All dollar amounts are stated in US
dollars.

Purchase of Notes

The first capital investment component of the Restructuring provides
for Northwest to acquire the currently outstanding Senior Secured Promissory
Notes held by Firstgolds primary creditors, Platinum Long Term Growth, LLC
(Platinum) and Lakewood Group LLC (Lakewood) for a one-time payment of
$11,500,000. The Binding Offer Letter provides for Northwest to make an initial
pre-loan payment of $1,000,000 of which $500,000 was allocated to Platinum and
Lakewood as a nonrefundable deposit and $500,000 was transferred to Firstgold
to be used for working capital purposes. These funds were received by
Firstgolds Canadian counsel on July 16, 2009. The balance of $11,000,000 will
be paid by Northwest to Platinum/Lakewood and Northwest will assume the
existing secured promissory notes currently held by Platinum and Lakewood.
Among other things, Northwest would assume all the security interests and title
liens currently held by Platinum and Lakewood thus making Northwest our primary
secured lender.

Working Capital Loan

The next capital investment component of the Restructuring is a
$5,500,000 loan to be made by Northwest to Firstgold which will be used to
discharge indebtedness to unsecured creditors and for general working capital.
The loan will bear interest at a fixed rate of 10% per annum and the principal
amount of the loan will be repaid in 24 equal monthly installments commencing
on September 1, 2010. $500,000 of the loan proceeds were previously advanced to
Firstgold on July 16, 2009 with the balance to be advanced to Firstgold on or
before August 31, 2009. See Extension of
Restructuring Transactionbelow.

Subscription for Shares

The third capital investment component of the Restructuring is the
purchase of shares of Firstgold common stock whereby, on or about September 30,
2009, and subject to shareholder approval and regulatory approval, Northwest
will subscribe for that number of shares from the authorized but unissued
(post-split) shares which will equal 51% of the then issued and outstanding
shares of Firstgold common stock for an amount of $9,500,000 (the Subscription
Transaction) and result in a change of control of Firstgold. The proceeds from
this subscription Transaction will be used for general working capital
including the resumption of gold exploration and processing at Firstgolds
Relief Canyon mining site.

Structural Changes Required by Northwest

As part of the Restructuring, Northwest is allowed to nominate three
directors to the Firstgold Board of Directors with Mr. Sun Feng (Chairman of
Northwest) being designated as the new Chairman of the Firstgold Board. In
addition, the Amended and

26

---



Restated Certificate of Incorporation will be amended to provide for
the Chairman of the Board to have a casting vote meaning that in case of a
tie vote on any matter properly coming before the Board, the Chairman will have
two votes compared to one vote by each of the remaining Directors thus allowing
the Chairman the deciding vote in case of a tie vote on the Board. Northwest
will also be granted certain preemptive rights allowing it to maintain its 51%
ownership interest when and if currently outstanding warrants are exercised.

Financial Changes Required by Northwest

As a further condition of the Restructuring, Firstgold was required to
reduce the amount of debt owed to creditors. Consequently, Firstgold has
entered into arms length settlement arrangements with certain of its largest
unsecured creditors whereby it will issue up to 72,151,842 shares of common
stock, together with cash in the amount of approximately $4,838,000 in exchange
for the discharge of $8,408,735 of original indebtedness and the cancellation of
outstanding warrants exercisable into at least 44,394,000 shares of common
stock. In addition, 31,300,000 shares are to be issued to settle compensation
and other amounts owed to directors, officers and employees of Firstgold.

Voluntary Changes Deemed Beneficial to
Firstgold

In addition to the changes required by Northwest described above, the
Company is seeking stockholder approval for several other changes which the
Board believes to appropriate at this time including a 1-for-5 consolidation of
its outstanding common stock, increasing its authorized shares to 500,000,000
shares, allowing for automatic adjustments to the number of shares issuable
pursuant to the Companys 2006 Stock Option Plan and amending and restating the
Companys Bylaws.

Regulatory Requirements

In light of the fact that the above described transaction with
Northwest will result in a change of control in Firstgold, this proxy statement
is intended to meet the notice requirements of Regulation 14f-1 of the Proxy
Rules promulgated under the Securities Exchange Act of 1934 to disclose the
proposed change in control of the Firstgold Board of Directors as described
above.

Since the Firstgold common shares are currently listed on the Toronto
Stock Exchange (TSX), certain TSX rules and regulations require that: (i) the
issuance of shares by Firstgold to Northwest in an amount equal to 51% of the
then-outstanding shares resulting in a change of control, (ii) the proposed
issuance of shares representing more than 25% of the currently issued and outstanding
shares at a discount to the market price in settlement of indebtedness and
(iii) the issuance of share compensation to certain officers and directors of
the Company, must be approved by Firstgolds stockholders and are set forth
below as Proposal number 2, 3 and 10.

Due to the type of transaction involved and the nature of Northwest is
a Chinese entity, Northwest has been advised that an application should be made
to the Committee on

27

---



Foreign Investment in the United States (CFIUS). The purpose of such
application is to allow CFIUS to evaluate if any issues affecting national
security are included in the proposed Restructuring. While neither Northwest
nor Firstgold anticipate any objections based on national security concerns,
such application process is anticipated to take approximately 45 to 60 days to
complete. Northwest has determined to wait for CFIUS clearance before
proceeding with the Restructuring Transaction.

Information about Northwest

Northwest Nonferrous International Investment Company Ltd. is 100%
owned by the Northwest Mining and Geological Exploration Group Co. for
Nonferrous Metals (NWME) and is based in Xian city of Shaanxi province, China.
Northwest has more than 6,000 employees including 800 geologists,
technologists, and engineers.

Northwest is one of the top five exploration and mining Bureaus in
China amongst around 100 provincial Bureaus in terms of revenue and technical
capacity. Northwest was one of the first Bureaus in China to conduct
exploration projects in partnership with overseas companies. In 2007, Northwest
incorporated a joint venture with Yukon Nevada Gold Corporation to carry out
exploration on new acquisitions. In 2008, Northwest, in partnership with
Jinduicheng Molybdenum Group Co., Ltd., acquired Yukon Zinc Corporation.

Extension of Restructuring Transaction

Due to the need to prepare and file the CFIUS application referred to
above, the parties have agreed to extend the closing dates for each of the
Restructuring components as originally contemplated in the Binding Offer
Letter. It is now anticipated that the purchase of the Platinum/Lakewood Notes
and the working capital loan will occur in October, 2009 (upon receipt of CFIUS
clearance) and the subscription of shares is expected to take place on or before
December 1, 2009. In recognition of this extended timetable, Platinum/Lakewood
were allowed to draw down the $500,000 deposit posted by Northwest and will be
paid 1% of the outstanding Note balances per month until the purchase of the
Notes by Northwest occurs. In addition, Northwest will advance or cause to be
advanced to Firstgold approximately $500,000 to meet current operating capital
requirements until the Restructuring Transaction can be consummated.

Results of Operation

Our current business strategy is to invest in, explore and if
warranted, conduct mining operations of our current mining properties and other
mineral producing properties. Firstgold is a public company that in the past
has been engaged in the exploration, acquisition and development of
gold-bearing properties in the continental United States. Currently, our
principal assets include various mineral leases associated with the Relief
Canyon Mine located near Lovelock, Nevada along with various items of mining
equipment and improvements located at that site. We have also entered into (i)
the staking of approximately 4,200 acres of property located in Humboldt
County,

28

---



Nevada; (ii) claims to explore 2,300 acres of property located near
Fairview, Nevada; and (iii) mineral leases on 3,300 acres of property located
near Winnemucca, Nevada.

Operating Results for the Fiscal Quarters Ended July 31, 2009 and 2008

Although we commenced efforts to re-establish our mining business early
in fiscal year 2004, only minor mining operations were commenced earlier in the
year and only minimal revenues from mining operations have been recognized
during the quarter ended July 31, 2009 due to the fact that we were forced to
suspend mining and process activities due to the lack of funds at our primary
property, the Relief Canyon mine, and placed it on a care and maintenance
status as of April 2009. Revenue of $82,819 was recognized for the quarter
ended July 31, 2009 compared to $369,567 of revenue recognized during the same
quarter of 2008. During the second quarter of fiscal year 2010 we recognized
revenue from the refining of gold and performing assays for customers at our
lab. During the second quarter of fiscal year 2009 we recognized revenue from
the leasing of drill rigs and crews to other nearby mining operations. Costs of
services expended during the quarter ended July 31, 2009 were $14,269 compared
to $761,891 costs of services during the same quarter ended 2008. We have
granted a 4% net smelting return royalty to a third party related to the Relief
Canyon mining property which has been recorded as an $800,000 deferred option
income.

During the quarter ended July 31, 2009 we spent $265,359 for
exploration, reclamation and maintenance expenses related to our mining
properties. Reclamation and maintenance expenses expended during the same
quarter ended July 31, 2008 were $1,239,859. These expenses relate primarily to
exploration activities and installation of processing facilities at the Relief
Canyon Mine. During the quarter ended July 31, 2008 we expended approximately
$78,099 on preliminary exploration activities at the Horse Creek,
Fairview-Hunter and Honorine Gold properties. The decrease in costs was due
primarily to the lack of capital during the quarter to fully fund necessary
operational expenses and reducing the mine operations to a minimal care and
maintenance status. We incurred general and administrative expenses of $1,884,446
during the quarter ended July 31, 2009. Of this amount, $219,497 reflects
salary for administrative staff, payroll taxes and benefits, $1,375,852
reflects officer and director compensation during the quarter and $150,378
reflect fees for outside professional services. A large portion of the increase
in officer and director compensation reflects severance arrangements negotiated
with the former Chief Executive Officer and Chief Operating Officer of
Firstgold and the increase in board of Director meetings due to the proposed
restructuring transactions referred to above. We incurred general and
administrative expenses of $984,472 during the quarter ended July 31, 2008. Of
this amount, $35,206 reflects promotion expense; $135,433 reflects officer and
director compensation and related payroll taxes during the quarter and
$286,085reflect fees for outside professional services.

Professional services incurred for the quarter ended July 31, 2009
reflects legal and accounting work pertaining to our annual and quarterly
reporting on Form 10-K and Form 10-Q occurring in fiscal year 2010 and work
relating to the Restructuring

29

---



transaction. It is anticipated that both mining costs and operating
expenses will be significantly curtailed until we are able to secure necessary
additional financing to continue our exploration program and implement our
mining operations.

We incurred interest expense of $1,764,866 during the quarter ended
July 31, 2009 which compares to interest expenses of $121,305 incurred during
the same quarter of 2008. The principal balance of loans outstanding at the end
of the second quarter of fiscal year 2010 increased by $12,167,087 to
$14,238,032 compared to a principal balance of $2,070,945 outstanding at the
end of the second quarter of fiscal year 2009, which was primarily the result
of an increase in senior secured promissory notes issued during the third
quarter of fiscal 2009. The increase in accrued interest expense during the
quarter ended July 31, 2009 was primarily due to the increase in the principal
balance of promissory notes outstanding during the period and the imposition of
an 18% default rate of interest as of December 15, 2008.

Our total net loss for the quarter ended July 31, 2009 increased to
$4,212,865 compared to a net loss of $2,847,039 incurred for the same quarter
ended July 31, 2008. The larger net loss in the quarter ending July 31, 2009
reflects the increase in the general and administrative expense as well as a
substantial increase in interest expense. The increase in net loss for the
quarter ended July 31, 2009 was partially offset by the lower costs of services
and exploration and maintenance costs during the quarter and a small amount of
revenue.

Operating results for the Six Months Ended July 31, 2009 and 2008

During the six months ended July 31, 2009 we recognized revenue of
$171,538 from the initial mineral recovery of gold and silver and from
performing assays for customers at our lab. During the six months ended July
31, 2008 we recognized revenue of $645,360 from the leasing of drill rigs and
crew to other nearby mining operations. Costs of services expended during the
six months ended July 31, 2009 were $273,336 compared to $1,221,718 costs of
services during the same six month period ended 2008. We have granted a 4% net
smelting return royalty to a third party related to the Relief Canyon mining
property which has been recorded as an $800,000 deferred option income.

During the six months ended July 31, 2009, we spent $1,673,131 on
exploration, reclamation and maintenance expenses related to our mining
properties. Exploration, reclamation and maintenance expenses expended during
the six months ended July 31, 2008, were $2,189,006. The decrease in costs was
due primarily to the lack of capital during the quarter to fully fund necessary
operational expenses and reducing the mine operations to a minimal care and
maintenance status. We incurred general and administrative expenses of
$3,135,307 during the six months ended July 31, 2009. Of this amount, $569,409
reflects salary for administrative staff, payroll taxes and benefits,
$1,623,102 reflects officer and director compensation during the quarter and
$223,045 reflect fees for outside professional services. A large portion of the
increase in officer and director compensation reflects severance arrangements
negotiated with the former Chief Executive Officer and Chief Operating Officer
of Firstgold and the increase in

30

---



board of Director meetings due to the proposed restructuring
transactions referred to above. A large portion of the outside professional
services reflects legal and accounting work pertaining to our annual and
quarterly reporting on Form 10-K and Form 10-Q, legal costs associated with the
litigation involving the Crescent Red Caps LLC and the Restructuring
transaction. During the six months ended July 31, 2008, we incurred general and
administrative expenses of $2,331,128, of which $113,505 reflects promotional
expenses; $363,893 represented officer and director compensation, and
$1,253,900 reflected fees for outside professional services. It is anticipated
that both mining costs and operation costs will be significantly lower as we
continue to operate on a significantly reduced basis pending the consummation
of the Restructuring transaction.

We incurred interest expense of $3,253,899 during the six months ended
July 31, 2009, which compares to interest expenses of $155,911 incurred during
the same six months of 2008. The principal balance of loans outstanding at the
end of the second quarter of fiscal year 2010 increased by $12,167,087 to
$14,238,032 compared to a principal balance of $2,070,945 outstanding at the
end of the second quarter of fiscal year 2009, which was primarily the result
of an increase in senior secured promissory notes issued during the third
quarter of fiscal 2009 and other short term bridge notes. The increase in
additional interest expense during the six months ended July 31, 2009, was
primarily due to the increase in outstanding debt and the imposition of an 18%
default rate on our senior promissory notes.

Our total net loss of the six months ended July 31, 2009, increased to
$8,837,723 compared to a net loss of $5,445,606 incurred for the same six
months ended July 31, 2008. The increased net loss was due primarily to a
reduction in service revenue and a sharp increase in interest expenses during
the first six months of fiscal 2010.

Liquidity and Capital Resources

We have incurred significant operating losses since inception which has
resulted in an accumulated deficit of $54,648,110 as of July 31, 2009. At July
31, 2009, we had cash and other current assets of $171,334 compared to $389,553
at January 31, 2009 and a net working capital deficit of $16,824,071. Since the
resumption of our business in February 2003, we have been dependent on borrowed
or invested funds in order to finance our ongoing operations. As of July 31,
2009, we had outstanding notes payable in the gross principal amount of
$13,788,032 (net balance of $8,782,963 after $4,293,110 of deferred financing
costs and $711,959 of original issue discount) which reflects an increase of
$11,638,124 compared to notes payable in the gross principal amount of
$2,149,908, (net balance of $1,984,341 after $165,567 of deferred financing
costs) as of July 31, 2008.

We have posted with the United States Department of the Interior,
Bureau of Land Management a letter of credit which is secured by a certificate
of deposit in the amount of $613,500. Additionally, we have posted with the
United States Department of the Interior, Bureau of Land Management a cash bond
deposit in the amount of $2,183,846. The letter of credit and the cash bond
deposit cover future reclamation costs as required by the Nevada Division of
Environmental Protection relating to the Relief Canyon Mine.

31

---



In April, 2009 Firstgolds two primary lenders declared defaults under
their respective Senior Secured Promissory Notes aggregating $13,528,160 of
principal and interest as of July 31, 2009. On May 22, 2009 the lenders
commenced foreclosure proceedings under their Deeds of Trust and UCC Security
interests. If we are unsuccessful in closing the Restructuring transaction with
Northwest or in securing alternative financing if the Northwest Transaction is
not completed, these lenders could commence seizing and selling virtually all
of Firstgolds assets. In light of the pending Restructuring transaction, as of
September 15, 2009 the lenders had agreed to refrain from taking further action
against Firstgold on a month-to-month basis for the payment of $110,000 per
month in order to allow Firstgold to complete its Restructuring transaction. In
the interim, until new financing can be secured we have been forced to suspend
any additional processing activity at the plant and will maintain the Relief
Canyon Mine property on a care and maintenance basis until such time as full
operations can be restored.

We will require up to $13 million to cure the existing defaults under
the Senior Secured Promissory Notes and an additional approximately $5 million
to $10 million to bring the Relief Canyon Mine into full production and carry
out planned exploration on our other properties. We do not have sufficient
working capital to fund our current business plan for Relief Canyon. We are
currently pursuing the Restructuring transaction with Northwest which, if
completed, would provide for the purchase of the Senior Secured Promissory
Notes and provide us with critical working capital to resume operations at the
Relief Canyon mine. However, the sale of additional securities or incurring
additional debt must now be approved by the holders of our Senior Secured
Promissory Notes until such notes are paid off.

Due to our continuing losses from business operations, the independent
auditors report dated August 31, 2009, includes a going concern explanation
relating to the fact that Firstgolds continuation is dependent upon obtaining
additional working capital either through significantly increasing revenues or
through outside financing. As of January 31, 2009, Firstgolds principal commitments
included its obligation to pay a minimum of $400,000 per month on the Senior
Secured Promissory Notes (which Firstgold is not currently able to pay),
ongoing maintenance fees on 166 unpatented mining claims and the annual minimum
rent due on the three mineral leases and mortgage payments relating to its
offices and laboratory in Lovelock, Nevada.

We will need to raise additional capital to pay down our existing debt
and fund the long-term or expanded development, promotion and conduct of our
mineral exploration and mining operations. Due to our limited cash flow,
operating losses and limited assets, it is unlikely that we could obtain
financing through commercial or banking sources. Consequently, any future
capital requirements will be dependent on cash infusions from our major
stockholders or other outside sources in order to pay our current debts and
fund our future operations. If adequate funds are not available in the near
future, through public or private financing as well as borrowing from other sources,
Firstgold will not be able to pay its debts and its assets could be exposed to
forfeiture or bankruptcy.

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Recent Financing Transactions

In May 2009 three lenders loaned Firstgold $300,703 represented by
convertible loans. The loans bear interest of 18%, with principal and accrued
interest due in one year. The loans are convertible into common shares of
Firstgold at a conversion price of $0.15 per share. Additionally the lenders
received a right to purchase from future gold production of Firstgold gold at
$500 per ounce for every $200 advanced by the lenders. Accordingly the lenders
can purchase in total up to 1,503 ounces of gold from future production.

In May 2009 four directors and officers plus three employees converted
$252,571 owed to them for various fees and salary into convertible loans. The
loans bear interest of 18%, with principal and accrued interest due in one
year. The loans are convertible into common shares of Firstgold at a conversion
price of $0.15 per share. Additionally the lenders received a right to purchase
from future gold production of Firstgold gold at $500 per ounce for every $200
advanced by the lenders. Accordingly the lenders can purchase in total up to
1,246 ounces of gold from future production.

In May 2009 a note payable for $320,000 became past due. The lender has
not demanded payment and currently Firstgold is negotiating with the lender
regarding this matter.

In June 2009 $302,565 of convertible debt and accrued interest were
converted into 2,086,653 shares of common stock at a price of $0.145 per share.

A second mortgage for $67,500 due in June 2009 became past due and was
in default. In July 2009 the lender began foreclosure proceedings on the
building and improvements. In August 2009 Firstgold and the lender completed a
forbearance agreement whereby Firstgold will prepay one year of interest at 7%
on the mortgage while continuing to maintain its obligations to complete the
water line improvements referred to Note 5 above.

In September 2009 six lenders loaned Firstgold $600,000. The loans bear
interest of 12%, with principal and accrued interest due in one year. The loans
are convertible into common shares of Firstgold at a conversion price of $0.15
per share. Additionally the lenders received a right to purchase from future
gold production of Firstgold gold at $500 per ounce for every $200 advanced by
the lenders. Accordingly the lenders can purchase in total up to 3,000 ounces
of gold from future production.

Off-Balance Sheet Arrangements

During the fiscal quarter ended July 31, 2009, Firstgold did not engage
in any off-balance sheet arrangements as defined in Item 303(a)(4) of the SECs
Regulation S-K.

Critical Accounting Policies

The discussion and analysis of our financial conditions and results of
operations are based upon our financial statements, which have been prepared in
accordance with generally accepted accounting principles in the United States.
The preparation of

33

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financial statements
requires management to make estimates and disclosures on the date of the
financial statements. On an on-going basis, we evaluate our estimates,
including, but not limited to, those related to revenue recognition. We use
authoritative pronouncements, historical experience and other assumptions as
the basis for making judgments. Actual results could differ from those
estimates. We believe that the following critical accounting policies along
with those set forth in Note 3 to the financial statements, affect our more
significant judgments and estimates in the preparation of our financial
statements.

Valuation of
long-lived assets

Long-lived assets,
consisting primarily of property and equipment, patents and trademarks, and
goodwill, comprise a significant portion of our total assets. Long-lived assets
are reviewed for impairment whenever events or changes in circumstances
indicate that their carrying values may not be recoverable. Recoverability of
assets is measured by a comparison of the carrying value of an asset to the
future net cash flows expected to be generated by those assets. The cash flow
projections are based on historical experience, managements view of growth
rates within the industry, and the anticipated future economic environment.

Factors we consider
important that could trigger a review for impairment include the following:

(a)          significant
underperformance relative to expected historical or projected future operating
results,

(b)          significant
changes in the manner of its use of the acquired assets or the strategy of its
overall business, and

(c)          significant
negative industry or economic trends.

When we determine that
the carrying value of long-lived assets and related goodwill and
enterprise-level goodwill may not be recoverable based upon the existence of
one or more of the above indicators of impairment, we measure any impairment
based on a projected discounted cash flow method using a discount rate
determined by our management to be commensurate with the risk inherent in its
current business model.

Deferred
Reclamation Costs

In
August 2001, the Financial Accounting Standards Board (FASB) issued Statement
of Financial Accounting Standards (SFAS) No. 143, Accounting for Asset
Retirement Obligations, which established a uniform methodology for accounting
for estimated reclamation and abandonment costs. The statement was adopted
February 1, 2003. The reclamation costs will be allocated to expense over the
life of the related assets and will be adjusted for changes resulting from the
passage of time and revisions to either the timing or amount of the original
present value estimate.

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Prior
to adoption of SFAS No. 143, estimated future reclamation costs were based principally
on legal and regulatory requirements. Such costs related to active mines were
accrued and charged over the expected operating lives of the mines using the
units-of-production method based on proven and probable reserves. Future
remediation costs for inactive mines were accrued based on managements best
estimate at the end of each period of the undiscounted costs expected to be
incurred at a site. Such cost estimates included, where applicable, ongoing
care, maintenance and monitoring costs. Changes in estimates at inactive mines
were reflected in earnings in the period an estimate was revised.

Exploration Costs

Exploration costs are
expensed as incurred. All costs related to property acquisitions are
capitalized.

Mine Development
Costs

Mine development costs
consist of all costs associated with bringing mines into production, to develop
new ore bodies and to develop mine areas substantially in advance of current
production. The decision to develop a mine is based on assessment of the
commercial viability of the property and the availability of financing. Once
the decision to proceed to development is made, development and other
expenditures relating to the project will be deferred and carried at cost with
the intention that these will be depleted by charges against earnings from
future mining operations. No depreciation will be charged against the property
until commercial production commences. After a mine has been brought into
commercial production, any additional work on that property will be expensed as
incurred, except for large development programs, which will be deferred and
depleted.

Reclamation Costs

Reclamation costs and
related accrued liabilities, which are based on our interpretation of current
environmental and regulatory requirements, are accrued and expensed, upon
determination.

Based on current
environmental regulations and known reclamation requirements, management has
included its best estimates of these obligations in its reclamation accruals.
However, it is reasonably possible that our best estimates of our ultimate
reclamation liabilities could change as a result of changes in regulations or
cost estimates.

Valuation
of Derivative Instruments

FAS
No. 133 Accounting for Derivative Instruments and Hedging Activities requires bifurcation of embedded
derivative instruments and measurement of their fair value for accounting
purposes. In determining the appropriate fair value, the Company uses the Black
Scholes model as a valuation technique. Derivative liabilities are adjusted to
reflect fair value at each period end, with any increase or decrease in the
fair value being

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recorded
in results of operations as Adjustments to Fair Value of Derivatives. In
addition, the fair values of freestanding derivative instruments such as
warrants are valued using Black Scholes models.

Stock-Based
Compensation

We currently account for
the issuance of stock options to employees using the fair market value method
according to SFAS No. 123R, Share-Based
Payment.

Adopted Accounting
Pronouncements

See Note 3 to the Financial Statements.

|         |                        
|-------- | -----------------------
|ITEM 4T. | CONTROLS AND PROCEDURES

Disclosure
Controls and Procedures.

We have adopted and
maintain disclosure controls and procedures (as such term is defined in Rules
13a-15 (e) and 15d-15 (e) under the Securities Exchange Act of 1934, as amended
(the Exchange Act)) that are designed to ensure that information required to
be disclosed in our reports under the Exchange Act, is recorded, processed,
summarized and reported within the time periods required under SECs rules and
forms and that the information is gathered and communicated to our management,
including our Chief Executive Officer (CEO) and Chief Financial Officer (CFO),
as appropriate, to allow for timely decisions regarding required disclosure.

As required by SEC Rule
15d-15 (b) we carried out an evaluation, under the supervision and with the
participation of management, including our CEO and CFO, of the effectiveness of
the design and operation of our disclosure controls and procedures pursuant to
Exchange Act 15d-14 as of the end of the fiscal quarter covered by this report.
Based upon that evaluation, our CEO and CFO concluded that our disclosure
controls and procedures were effective in timely alerting them to material
information relating to Firstgold that is required to be included in our
periodic SEC reports and to ensure that information required to be disclosed in
our periodic SEC reports is accumulated and communicated to our management,
including our CEO and CFO, to allow timely decisions regarding disclosure as a
result of any deficiency detected in our internal control over financial
reporting.

Changes in Internal
Control Over Financial Reporting

During the quarter covered by this report, there was
no change in Firstgolds internal control over financial reporting that has
materially affected, or is reasonably likely to materially effect, the
Companys internal control over financial reporting.

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PART II - OTHER INFORMATION

|         |                                            
|-------- | -------------------------------------------
|ITEM 1A. | FACTORS AFFECTING FUTURE OPERATING
 RESULTS

In addition to the risk
factors disclosed in the Firstgold Form 10-K for the fiscal year ended January
31, 2009, the following risks have changed or been added to the risk factors
previously disclosed in the Firstgold 10-K.

We are an exploration
stage company and an investment in, or ownership position in our common stock
is inherently risky. Some of the risks set forth in our Form 10-K or in this
Form 10-Q (together referred to as the Firstgold Risk Factors) pertain to our
business in general, and others are risks which would only affect our common
stock. The price of our common stock could decline and/or remain adversely
affected due to any of the Firstgold Risk Factors and investors could lose all
or part of an investment in our company as a result of any of the Firstgold
Risk Factors coming to pass. Readers of this Report should, in addition to
considering these risks carefully, refer to the other information contained in
this Report, including disclosures in our financial statements and all related
notes. If any of the events described below were to occur, our business,
prospects, financial condition, or results of operations or cash flow could be
materially adversely affected. When we say that something could or will have a
material adverse effect on Firstgold, we mean that it could or will have one or
more of these effects. We also refer readers to the information in this Report,
discussing the impact of Forward-Looking Statements on the descriptions
contained in this Report and included in the Factors discussed below.

As an exploration stage
company with no proven mineral reserves, we may not be able to prove viable
mineral reserves or achieve positive cash flows and our limited history of
operations makes evaluation of our future business and prospects difficult. We
reactivated our business operations in early 2003 and we have not generated any
revenues, other than leasing certain of our drill rigs and crew for short
periods of time, since our reactivation. As a result, we have only a limited
operating history upon which to evaluate our future potential performance. Our
prospects must be considered in light of the risks and difficulties encountered
by companies which have not yet established their mining operations.

We
will need additional funds to finance our mining and exploration activities as
well as fund our current operations. Due to our lack of funds, we had to
suspend operations at the Relief Canyon mine site and lay-off most of our
employees. Our ability to meet our long-term obligations in the ordinary course
of business is dependent upon our ability to raise additional capital through
public or private equity financings, establish increasing cash flow from
operations, entering into joint ventures or other arrangements with capital
sources, or secure other sources of financing to fund operations. We are
currently in negotiations with Northwest to provide up to $9,500,000 in
operating capital to Firstgold. However, this transaction is not expected to
close until October, 2009 and may not close

37

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at
all if various conditions to closing, including completion of due diligence and
stockholder approvals, are not achieved in a timely manner.

We do not have sufficient
funds to finance our near-term mining activities at the Relief Canyon Mine or
pursue preliminary exploration activities at our other properties. We had cash
reserves of $81,918 and a working capital deficit of $16,824,071 as of July 31,
2009. As a result, we have been forced to suspend operations at the Relief
Canyon Mine and put the mine site in a care and maintenance status and cease
all exploration activities. Our ability to resume operations at the Relief
Canyon Mine, implement our business plan and meet our long-term obligations in
the ordinary course of business is dependent upon closing the Restructuring
transaction with Northwest or raising additional capital through public or
private equity financings, establishing cash flows from operations, entering
into joint ventures or other arrangements with capital sources, or securing
other sources of financing to fund operations. Our continuing reliance on
outside capital is a consequence of our negative cash flows from operations.

On
August 7, 2008 Firstgold entered into a Note and Warrant Purchase Agreement
(the Agreement) which created a long-term debt obligation in the aggregate
amount of $12,000,000. Pursuant to the Agreement commencing on December 15,
2008 and continuing in each month thereafter, Firstgold is required to make
monthly principal reduction payments equal to the greater of: i) 40% of
Firstgolds free cash flow (as defined in the Agreement) in the preceding
calendar month, and ii) $400,000. Firstgold has not paid any of the principal
reduction payments. Therefore, as of December 16, 2008, Firstgold was in
default for non-payment of the required principal payment of $400,000 on the
Senior Secured Promissory Notes. As a result of the default, the $12 million
principal balance could be called immediately due and payable by the Lenders
and the Lenders began charging a default interest rate of 18% per annum.
Additionally, the loans are secured by a first priority interest in all of
Firstgolds assets including its equipment, its mining rights existing at its
Relief Canyon mine as well as any future mining rights Firstgold may develop in
certain other properties. On June 17, 2009 these lenders filed an application
to have a receiver appointed to oversee Firstgolds operations and assets. Due
to the current negotiations with Northwest which, among other things, would
assume the lenders Senior Secured Promissory Notes for payment of $11,500,000,
the lenders have agreed to refrain from any further action until the Northwest
transaction is consummated or terminated. Commencing September 1, 2009,
Firstgold is required to pay a monthly extension fee of $110,000. The September
extension fee was paid on September 15, 2009.

A
second mortgage for $67,500 due in June 2009 became past due and was in
default. In July 2009 the lender began foreclosure proceedings on the building
and improvements. In August 2009 Firstgold and the lender completed a
forbearance agreement whereby Firstgold will prepay one year of interest at 7%
on the mortgage while continuing to maintain its obligations to complete the
water line improvements.

Our current independent
certified public accountants have expanded their opinion contained in our
financial statements as of and for the years ended January 31, 2008,

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through January 31, 2009
to include an explanatory paragraph related to our ability to continue as a
going concern, stating, in the audit report dated August 31, 2009, that the
Company had an accumulated deficit of $45,835,365 at January 31, 2009. These
factors, among others, as discussed in Note 2- Going Concern to the financial
statements, raise substantial doubt about the Companys ability to continue as
a going concern. The auditors recognize that the cash flow uncertainty makes
their basic assumptions about value uncertain. When it seems uncertain whether
an asset will be used in a going concern or sold at auction, the auditors
assume that the business is a going concern for purposes of all their work,
and then they disclose that there is material uncertainty about that
assumption. It is definitely a consequence of our negative cash flows from
operations that we continually need additional cash. At any time, a serious
deficiency in cash reserves could occur and it is not always possible or
convenient to raise additional capital. A problem in raising capital could
result in temporary or permanent insolvency and consequently potential claims
by unpaid creditors and perhaps closure of the business. All of these things
are possibilities. It is certain, in any case, that analysts and investors view
unfavorably any report of independent auditors expressing substantial doubt
about a companys ability to continue as a going concern.

As of July 31, 2009,
Firstgold had approximately 145,303,888 shares of Common Stock outstanding and
options and warrants to purchase a total of 35,709,228 shares of our Common
Stock were outstanding as of July 31, 2009. In addition, 103,451,842 shares are
planned to be issued in exchange for cancellation of debt and outstanding
warrants. The possibility that substantial amounts of our outstanding Common
Stock may be sold by investors or the perception that such sales could occur,
often called equity overhang, could adversely affect the market price of our
Common Stock and could impair our ability to raise additional capital through
the sale of equity securities in the future.

|        |                                         
|------- | ----------------------------------------
|ITEM 2. | UNREGISTERED SALES OF EQUITY
 SECURITIES

In May 2009 three lenders
loaned Firstgold $300,703. The loans bear interest of 18%, with principal and
accrued interest due in one year. The loans are convertible into common shares
of Firstgold at a conversion price of $0.15 per share. Additionally the lenders
received a right to purchase from future gold production of Firstgold gold at
$500 per ounce for every $200 advanced by the lenders. Accordingly the lenders
can purchase in total up to 1,503 ounces of gold from future production.

In May 2009 four
directors and officers plus three employees converted $249,271 owed to them for
various fees and salary into convertible loans. The loans bear interest of 18%,
with principal and accrued interest due in one year. The loans are convertible
into common shares of Firstgold at a conversion price of $0.15 per share.
Additionally the lenders received a right to purchase from future gold
production of Firstgold gold at $500 per ounce for every $200 advanced by the
lenders. Accordingly the lenders can purchase in total up to 1,246 ounces of
gold from future production.

In June 2009 $302,565 of
convertible debt and accrued interest were converted into

39

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2,086,653 shares of
common stock at a price of $0.145 per share.

The issuance of the
above-referenced debt instruments and conversion of debt for equity were made
without any public solicitation and to a limited number of investors, including
officers and directors or related individuals or entities. Each investor
represented to us that the securities were being acquired for investment
purposes only and not with an intention to resell or distribute such
securities. Each of the individuals or entities had access to information about
our business and financial condition and was deemed capable of protecting their
own interests. The debt instruments and the shares issued in conversion of debt
were issued pursuant to the private placement exemption provided by Section
4(2) and/or Section 4(6) of the Securities Act of 1933 (the Securities Act).
The notes and shares issued are deemed to be restricted securities as defined
in Rule 144 under the Securities Act and stock certificates issued upon
conversion of debt bear a legend limiting the resale thereof.

|        |                                
|------- | -------------------------------
|ITEM 3. | DEFAULTS UPON SENIOR SECURITIES

On
August 7, 2008 Firstgold entered into a Note and Warrant Purchase Agreement
(the Agreement) which created a long-term debt obligation in the aggregate
amount of $12,000,000. Pursuant to the Agreement commencing on December 15,
2008 and continuing in each month thereafter, Firstgold is required to make
monthly principal reduction payments equal to the greater of: i) 40% of
Firstgolds free cash flow (as defined in the Agreement) in the preceding
calendar month, and ii) $400,000. Firstgold has not paid any of the principal
reduction payments. Therefore, as of December 16, 2008, Firstgold was in
default for non-payment of the required principal payment of $400,000 on the
Senior Secured Promissory Notes. As a result of the default, the $12 million principal
balance could be called immediately due and payable by the Lenders and the
Lenders began charging a default interest rate of 18% per annum. Additionally,
the loans are secured by a first priority interest in all of Firstgolds assets
including its equipment, its mining rights existing at its Relief Canyon mine
as well as any future mining rights Firstgold may develop in certain other
properties. On March 31, 2009 Firstgold entered into a Notice of Default and
Forbearance Agreement whereby the Lenders agreed to forbear from further
default proceedings until April 30, 2009. However, on April 22, 2009 the
secured lenders terminated the Forbearance Agreement and declared defaults
under their respective Senior Secured Notes. On June 17, 2009 these lenders
filed an application to have a receiver appointed to oversee Firstgolds
operations and assets. Due to the current negotiations with Northwest which,
among other things, would assume the lenders Senior Secured Promissory Notes
for payment of $11,500,000, the lenders have agreed to refrain from any further
action until the Northwest transaction is consummated or terminated.

A second mortgage for
$67,500 due in June 2009 became past due and was in default. In July 2009 the
lender began foreclosure proceedings on the building and improvements. In
August 2009 Firstgold and the lender completed a forbearance agreement whereby
Firstgold will prepay one year of interest at 7% on the mortgage while
continuing to maintain its obligations to complete the water line improvements.

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In June, 2009, Firstgold vacated its offices in Cameron Park,
California. The Amended Office Building Lease requires a monthly rent of $9,526
and expires on January 31, 2011. As of July 31, 2009 Firstgold owed back rent,
late fees and interest aggregating $51,072. Firstgold is currently negotiating
a settlement of this lease obligation and the landlord is attempting to
re-lease the premises.

|        |                  
|------- | -----------------
|ITEM 5. | OTHER INFORMATION

On June 17, 2009 the common shares of Firstgold ceased to be listed on
the OTC Bulletin Board system but continue to be quoted and traded in the
over-the-counter market in the US.

Subsequent to the end of the quarter, the Investment Industry
Regulatory Organization of Canada (IIROC) issued a trading halt for the
common stock of Firstgold listed on the Toronto Stock Exchange (TSX). It is
anticipated that upon the filing of the Firstgold Form 10-Qs for the 1st
and 2nd fiscal quarters which will bring Firstgold current in its
filing requirements under the 1934 Act, the IIROC will allow Firstgold common
shares to resume trading on the TSX.

|        |         
|------- | --------
|ITEM 6. | EXHIBITS

| |      |                                                                                        
| | ---- | ---------------------------------------------------------------------------------------
| | 31.1 | Certification
 of CEO pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.       
|
| | 31.2 | Certification
 of CFO pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.       
|
| | 32.  | Certification
 by CEO and CFO pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

SIGNATURES

In accordance with the requirements of the Securities Exchange Act of
1934, the Registrant has caused this report to be signed on its behalf by the undersigned,
thereunto duly authorized.

|                        |                  |                                                                        
|----------------------- | ---------------- | -----------------------------------------------------------------------
|                        | FIRSTGOLD
 CORP.
|                        |                  |                                                                        
|Dated:
 October 6, 2009 | By:              | /s/ Terrence Lynch                                                     
|                        |                  |                                                                        
|                        |                  | Terrence
 Lynch, Chief Executive Officer                               
|                       
|                        |                  | /s/ James Kluber                                                       
|                        |                  |                                                                        
|                        |                  | James
 Kluber, Principal Accounting Officer and Chief Financial Officer

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