10-Q

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, DC  20549

FORM 10-Q

[X]  QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE

SECURITIES EXCHANGE ACT OF 1934

FOR THE QUARTERLY PERIOD ENDED APRIL 30, 2008

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)
3108 Ponte Morino Drive, Suite 210 Cameron Park, CA		95682
(Address of Principal Executive Offices)		Zip Code
Issuer's telephone number:	(530) 677-5974

Check 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  

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

Large accelerated filer	Accelerated filer
Non-accelerated filer	Smaller reporting company      X

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

YES    NO      X     

Common stock, $0.001 par value, 130,845,543 issued and outstanding as of  May 30, 2008.

INDEX

		Page
PART I - FINANCIAL INFORMATION		3
	ITEM 1. FINANCIAL STATEMENTS	3
	ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OR PLAN OF OPERATIONS	18
	ITEM 4T. CONTROLS AND PROCEDURES	24
PART II - OTHER INFORMATION		24
	ITEM 1. LEGAL PROCEEDINGS	24
	ITEM 1A. FACTORS AFFECTING FUTURE OPERATING RESULTS	25
	ITEM 2. UNREGISTERD SALES OF EQUITY SECURITIES	27
	ITEM 5. OTHER INFORMATION	28
	ITEM 6. EXHIBITS	28

PART I - FINANCIAL INFORMATION

ITEM 1. FINANCIAL STATEMENTS

FIRSTGOLD CORP.

INDEX TO UNAUDITED FINANCIAL STATEMENTS

	Page
Condensed Balance Sheet as of April 30, 2008 (Unaudited)
and for fiscal year ended January 31, 2008 (Audited)	4
Condensed Statements of Operations for the three months ended
April 30, 2008 and 2007 (Unaudited)	6
Condensed Statements of Cash Flows for the three months
ended April 30, 2008 and 2007 (Unaudited)	7
Notes to Unaudited Financial Statements	10

3

FIRSTGOLD CORP.

(A DEVELOPMENT STAGE COMPANY)

BALANCE SHEET

	April 30,		January 31,
	2008		2008
	(unaudited)
ASSETS
Current assets:
Cash	$	1,168,620	$	383,223
Receivables		58,383		196,811
Deposits		98,968		295,281
Prepaid expense		282,009		242,577
Inventory		289,362		7,721
Total current assets		1,897,342		1,125,613
Property, plant and equipment, net of accumulated depreciation of    $310,271 and $205,084 at April 30 and January 31, 2008, respectively		10,704,704		8,438,997
Other Assets
Restricted cash		674,850		674,850
Deferred reclamation costs		680,326		680,326
Total other assets		1,355,176		1,355,176
Total assets	$	13,957,222	$	10,919,786

LIABILITIES AND SHAREHOLDERS' DEFICIT

Current liabilities
Accounts payable	$	798,622	$	2,730,596
Accrued expenses		570,310		538,987
Notes payable		116,264		163,726
Total current liabilities		1,485,196		3,433,309
Long-term liabilities
Convertible debenture net of deferred  financing  costs of
$133,172 and $148,480 at April 30 and January 31, 2008, respectively		701,360		694,211
Accrued reclamation costs		680,326		680,326
Deferred revenue		800,000		937,650
Total long-term liabilities		2,181,686		2,312,187
Total liabilities		3,666,882		5,745,496

4

FIRSTGOLD CORP.

(A DEVELOPMENT STAGE COMPANY)

BALANCE SHEET

	April 30,			January 31,
	2008			2008
	(unaudited)
Commitments and contingencies
Shareholders' surplus (deficit)
Common stock, $0.001 par value
250,000,000 shares authorized at April 30 and January 31, 2008, respectively
130,256,006 and 117,432,317 shares issued and outstanding at
April 30 and January 31, 2008, respectively		130,256			117,432
Additional paid in capital		44,146,538			36,447,996
Deficit accumulated during the exploration stage		(33,986,454	)		(31,391,142	)
Total shareholders' surplus (deficit)		10,290,340			5,174,290
Total liabilities and shareholders' surplus	$	13,957,222		$	10,919,786

5

FIRSTGOLD CORP.

(A DEVELOPMENT STAGE COMPANY)

STATEMENTS OF OPERATIONS

For the Three Months Ended April 30, 2008 and 2007

and for the Period from January 1, 1995 to April 30, 2008

							For the Period
							From January 1,
	For the Three Months Ended April 30,						1995 to April 30,
	2008			2007			2008
Net sales	$	275,793		$	-		$	827,072
Exploration and maintenance costs		(1,391,411	)		(126,681	)		(5,480,763	)
Gross loss		(1,115,618	)		(126,681	)		(4,653,691	)
Operating expenses		(1,466,154	)		(985,685	)		(23,049,128	)
Loss from operations		(2,581,772	)		(1,112,366	)		(27,702,822	)
Other income (expense)
Interest income		21,063			5,966			299,734
Dividend income		-			-			30,188
Other income		-			-			6,565
Adjustments to fair value of derivatives		-			(1,623,255	)		(2,277,166	)
Interest expense		(34,605	)		(247,959	)		(3,910,061	)
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		-			-			(334,927	)
Loss on disposal of bond		-			-			(21,000	)
Total other income (expense)		(8,795	)		(1,865,248	)		(5,341,839	)
Net loss	$	(2,595,314	)	$	(2,977,614	)	$	(33,044,661	)
Basic and diluted loss per share	$	(0.02	)	$	(0.04	)
Basic and diluted weighted-average   shares outstanding		125,370,254			80,160,412

6

  FIRSTGOLD CORP.

  (A DEVELOPMENT STAGE COMPANY)
  STATEMENTS OF CASH FLOWS

For the Three Months Ended April 30, 2008 and 2007

  and for the Period from January 1, 1995 to January 31, 2008

							For the Period
	For the Three Months Ended April 30,						From January 1, 1995
	2008			2007			to April 30, 2008
Cash flows from operating activities
Net loss	$	(2,595,314	)	$	(2,977,614	)	$	(33,044,661	)
Adjustments to reconcile net loss to net cash
used in operating activities:
Accretion of warrants issued as a debt discount		10,553			10,533			1,341,606
Accretion of beneficial conversion		-			-			107,468
Accretion of debt discount		-			150,931			531,110
Adjustments to  fair value of derivatives		-			1,623,255			1,357,904
Loss from joint venture		-			-			859,522
Loss on sale of marketable securities		-			-			281,063
Depreciation and amortization		109,942			39,649			509,399
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		-			183,933			2,108,452
Assigned value of stock options issue for compensation		59,311			27,063			895,864
Gain on write off of note payable		-			-			(7,000	)
Judgment loss accrued		-			-			250,000
(Increase) decrease in:
Restricted cash		-			(423,869	)		(674,850	)

Receivables	138,428		100,000		(54,383	)
Deposits	196,313		-		(94,468	)
Deferred reclamation costs	-		-		214,848
Prepaid expenses	(39,432	)	12,481		(284,909	)
Inventory	(281,641	)	(7,721	)	(289,362	)
Reclamation bonds	-		-		185,000
Other assets	-		-		(1,600	)
Increase (decrease) in:
Accounts payable	(1,931,974	)	75,800		517,662
Accrued expenses	(31,323	)	55,220		1,063,320
Net cash used by operating activities	(4,302,491	)	(1,130,319	)	(19,160,132	)

7

FIRSTGOLD CORP.

  (A DEVELOPMENT STAGE COMPANY)
  STATEMENTS OF CASH FLOWS

For the Three Months Ended April 30, 2008 and 2007

  and for the Period from January 1, 1995 to January 31, 2008

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	(2,370,894	)	(357,035	)	(13,966,483	)
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	(2,370,894	)	(357,035	)	(14,576,328	)
Cash flows from financing activities
Proceeds from the issuance of common stock	7,652,064		2,908,349		28,258,782
Proceeds from notes payable	-		910,000		8,646,733
Principal repayments of notes payable	(111,586	)	(1,843	)	(2,631,443	)
Repayment of advances to affiliate	-		-		(231,663	)
Deferred revenue	(137,650	)	-		800,000
Net cash provided by financing activities	7,402,828		3,816,506		34,842,409

Net increase  in cash		785,397		2,329,152		1,175,307
Cash, beginning of year		383,223		150,647		6,687
Cash, end of year	$	1,168,620	$	2,479,799	$	1,168,620

8

FIRSTGOLD CORP.

(A DEVELOPMENT STAGE COMPANY)

 STATEMENTS OF CASH FLOWS

For the Three Months Ended April 30, 2008 and 2007

and for the Period from January 1, 1995 to April 30, 2008

Supplemental cash flow information for the three months ended April 30, 2008 and 2007 and January 1, 1995 through April 30, 2008 as follows:
					For the Period
					From January 1,
	For the Three Months Ended April 30,				1995 to April
	2008		2007			30, 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	$	-	$	244,678	$	2,093,573
Conversion of convertible debentures to common stock, including interest of $217,151	$	3,186,203	$	1,173,406	$	4,359,609
Issuance of warrants as financing costs in connection with convertible debt	$	-	$	173,114	$	2,093,573
Issuance of common stock as payment for settlement of liabilities	$	-	$	206,375	$	2,093,573

9

FIRSTGOLD CORP.

(A DEVELOPMENT STAGE COMPANY)

NOTES TO FINANCIAL STATEMENTS

For the Three Months Ended April 30, 2008

NOTE 1 - ORGANIZATION AND LINE OF BUSINESS

Firstgold Corp. has been in the business of acquiring, exploring, developing, and producing gold properties.  Firstgold had rights to mine properties in Nevada and Montana.  Its primary focus was on the Relief Canyon mine located near Lovelock, Nevada, where it has performed development and exploratory drilling and was in the process of obtaining permits to allow operation of the Relief Canyon Mine.  In December 1997, Firstgold placed the Relief Canyon Mine on care and maintenance status.  From mid-2001 until the beginning of 2003 Firstgold was essentially inactive, only continuing with some of the care and maintenance at Relief Canyon, as provided for by a non-affiliate company owned by the Chief Operating Officer of Firstgold.

Firstgold has embarked on a business strategy whereby it will invest in and/or manage the exploration of gold and other mineral producing properties.  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 located at that site.  Firstgold’s business will be to acquire, explore and, if warranted, develop various mining properties located in the state of Nevada.  Firstgold plans to carryout comprehensive exploration and development programs on its properties.  Firstgold plans to conduct these activities itself, although some activities may be outsourced.  Consequently, Firstgold's current plan will require the hiring of significant amounts of mining employees to carry out its future mining and current exploration activities.

NOTE 2 - GOING CONCERN

These financial statements have been prepared on a going concern basis.  During the years ended January 31, 2008 and 2007 and the period from January 1, 1995 to January 31, 2008, Firstgold incurred net losses of approximately $7,632,537, $4,728,070,  and $30,449,347, respectively.  In addition, Firstgold has been in the exploration stage since inception and through April 30, 2008.  Information for the three months ended April 30, 2008 include a net loss of $2,595,314 negative cash flows from operations of $4,302,491 and an accumulated shareholders’ surplus of $10,290,340.  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 equity and debt securities.

Management plans to continue to provide for its capital needs during the year ending January 31, 2009 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 Firstgold 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-KSB, as filed with the SEC for the year ended January 31, 2008.

Exploration Stage Company

Effective January 1, 1995 (date of inception), the Company is considered a development stage Company as defined in SFAS No. 7.  The Company’s development stage activities consist of the development of several mining properties located in Nevada. Sources of financing for these development 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.

10

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.

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 UOP 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.

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.

Risks Associated with Gold Mining

The business of gold mining is subject to certain types of risks, including environmental hazards, industrial accidents, and theft.  Prior to suspending operations, Firstgold carried insurance against certain property damage loss (including business interruption) and comprehensive general liability insurance.  While Firstgold maintained 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.  Firstgold has not obtained environmental liability insurance because such coverage is not considered by management to be cost effective.  Firstgold currently carries no insurance on any of its properties due to the current status of the mine and Firstgold’s current financial condition.

Comprehensive Income

Firstgold 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 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 Firstgold's financial statements since Firstgold did have unrealized gain (loss) from changes in equity from available-for-sale marketable securities.

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

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

11

	2008		2007
Warrants		47,455,918		39,500,976
Stock options		5,421,038		3,750,000

Recent Accounting Pronouncements

In February 2007, the FASB issued SFAS No. 159, “The Fair Value Option for Financial Assets and Financial Liabilities” (SFAS 159).  Under the provisions of SFAS 159, Companies may choose to account for eligible financial instruments, warranties and insurance contracts at fair value on a contract-by-contract basis. Changes in fair value will be recognized in earnings each reporting period. SFAS 159 is effective for financial statements issued for fiscal years beginning after November 15, 2007, and interim periods within those fiscal years.  The Company is required to and plans to adopt the provisions of SFAS 159 beginning in the first quarter of 2008. The Company is currently assessing the impact of the adoption of SFAS 159.

NOTE 4 - PROPERTY AND EQUIPMENT

Property and equipment was recorded at $11,014,975 and $1,305,914 at April 30, 2008 and 2007, respectively.  Depreciation expense was $105,187 and $24,789 for the three months ended April 30, 2008 and 2007, respectively

NOTE 5 - NOTES PAYABLE

Notes payable consist of the following at April 30, 2008:

Equipment notes payable	$	60,298
The first note does not bear any interest and is due in December 2010.  The second note bears interest at 8.6% and is due June 2011.  The loans are secured by a Caterpillar loader and backhoe.
Insurance premium note payable		55,966
The note bears interest at 5.6%, is payable in monthly installments of $6,218 and is due February 2009.
Total notes payable	$	116,264

Firstgold recorded interest expense of $34,605 and $247,959 for the three months ended April 30, 2008 and 2007, respectively.

NOTE 6 – CONVERTIBLE DEBENTURES

September 26, 2006 Convertible Debenture

On September 26, 2006, Firstgold entered into a Securities Purchase Agreement (the “Purchase Agreement”) and other agreements, as amended on November 1, 2006, in connection with the private placement of convertible debentures, in the aggregate principal amount of $3,000,000 and bearing interest at 8% per annum (the “Debenture”).  The Debentures were funded $1,000,000 on September 26, 2006, $1,000,000 upon the filing of a resale registration statement with the SEC on December 1, 2006 and $1,000,000 on March 15, 2007.  Of the $1,000,000 funded on September 26, 2006, $120,000 was paid for various loan fees and closing costs; of the $1,000,000 funded December 1, 2006, $90,000 was paid for various loan fees and closing costs; and of the $1,000,000 funded March 19, 2007, $90,000 was paid for various loan fees and closing costs.  

12

The Debentures are due and payable three years after the issue date unless it is converted into shares of common stock or is repaid prior to its expiration date.  The conversion rate is adjustable and at any conversion date, will be the lower of $0.45 per share or 95% of the Market Conversion Price.  On July 13, 2007 $450,000 of the Debenture dated March 15, 2007 was converted into 1,000,000 shares of common stock. On September 13, 2007 the $1,000,000 Debenture dated September 26, 2006 was converted into 2,222,222 shares of common stock. On October 12, 2007 $450,000 of the Debenture dated December 1, 2006 was converted into 1,000,000 shares of common stock. On October 16, 2007 $450,000 of the Debenture dated December 1, 2006 was converted into 1,000,000 shares of common stock. On October 30, 2007 1,444,444 shares of common stock were issued in conversion of the remaining $650,000 in principal of outstanding Secured Convertible Debentures.  An additional 413,784 shares of common stock was issued in conversion of $186,203 of accrued interest on the Secured Convertible Debentures.

October 10, 2006 Convertible Debentures

On October 10, 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.

NOTE 7 - COMMITMENTS AND CONTINGENCIES

Except for the advance royalty and rent payments noted below, Firstgold is not obligated under any capital leases or non-cancelable operating lease with initial or remaining lease terms in excess of one year as of April 30, 2008.  However, minimum annual royalty payments are required to retain the lease rights to Firstgold’s properties.

Relief Canyon Mine

Our mining property rights are represented by 146 unpatented mill site and mining lode claims which were re-staked in October 2004 and June 2006.  Unpatented mining claims are generally considered subject to greater title risks than patented mining claims or real property interests that are owned in fee simple.  To remain valid, such unpatented claims are subject to annual maintenance fees.  As of April 30, 2008, we were current in the payment of such maintenance fees.

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.

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).  

13

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, 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.  Firstgold is currently evaluating this lawsuit and expects to vigorously defend this action.

Firstgold 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 Firstgold’s financial position, results of operations or liquidity.

NOTE 8 - SHAREHOLDERS' SURPLUS

Common Stock

In February 2008 warrants to purchase 250,000 shares of common stock were exercised at an average exercise price of $0.25 per share.

In February 2008 Firstgold received proceeds of $3,450,975 upon the issuance of Units consisting of 5,309,193 shares of common stock and warrants to purchase 2,654,460 shares of common stock at an exercise price of $0.80 per share.   The warrants have a term of 18 months.

In March 2008 Firstgold received proceeds of $4,261,822 upon the issuance of Units consisting of 6,556,650 shares of common stock and warrants to purchase 3,278,325 shares of common stock at an exercise price of $0.80 per share.   The warrants have a term of 18 months.

In April 2008 Firstgold received proceeds of $330,100 upon the issuance of Units consisting of 507,846 shares of common stock and warrants to purchase 253,923 shares of common stock at an exercise price of $0.80 per share.   The warrants have a term of 18 months.

In April 2008 warrants to purchase 200,000 shares of common stock were exercised at an exercise price of $0.50 per share.

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Warrants

The fair market value of warrants issued during the three months ended April 30, 2008 in conjunction with the issuance of common stock was determined to be $1,498,387 and was calculated under the Black-Scholes option pricing model with the following assumptions used:

Expected life	1.5 years
Risk free interest rate	1.53% to 2.19%
Volatility	63.39%
Expected dividend yield	None

The fair value of these warrants has been recorded as both a debit and credit to additional paid in capital.

The following table presents warrant activity from January 31, 2008 through April 30, 2008:

	Number of Shares			Weighted- Average Exercise Price
Outstanding, January31, 2008		39,507,146		$	0.47
Exercised		(450,000	)	$	(0.36	)
Granted		8,398,772		$	0.80
Outstanding, April 30, 2008		47,455,918		$	0.53
Exercisable, April 30, 2008		47,455,918		$	0.53

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).

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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.

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.

For the three months ended April 30, 2008 the Company’s calculations were made using the Black-Scholes option pricing model with the following weighted average assumptions: expected life, 36 months following the grant date; stock volatility, 63.4%; risk-free interest rates of 1.77% to 2.19%; and no dividends during the expected term. 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:

			Weighted Ave.		Aggregate
	# of Shares		Exercise Price		Intrinsic Value
Outstanding as of January 31, 2008		4,650,000	$	0.61	$	0
Granted		771,038	$	0.68	$	0
Exercised		0	$	0.00
Cancelled		0	$	0.00
Outstanding as of April 30, 2008		5,421,038	$	0.62	$	0
Exercisable as of April 30, 2008		2,137,500	$	0.55	$	0

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Additional information regarding options outstanding as of April 30, 2008 is as follows:

				Options outstanding			Options exercisable
				Weighted average	Weighted				Weighted
Range of				remaining	average				average
exercise		Number		contractual	exercise		Number		exercise
prices		outstanding		life (years)	price		exercisable		price
	$0.35		250,000	8.75	$	0.35		125,000	$	0.35
	$0.50		2,150,000	8.40	$	0.50		1,700,000	$	0.50
	$0.65-$0.70		2,021,038	9.15	$	0.66		1,317,760	$	0.66
	$0.85		750,000	9.50	$	0.85		375,000	$	0.85
	$0.94		250,000	9.50	$	0.94		62,500	$	0.94
			5,421,038	8.9	$	0.62		3,580,260	$	0.60

The weighted-average grant-date fair value of options granted during the three months ended April 30, 2008 was $0.68. At April 30, 2008 there was $418,447 of total unrecognized compensation costs related to non-vested stock options granted under the Plan, which will be recognized over a period not to exceed three years. At April 30, 2008, 4,578,962 shares were available for future grants under the Stock Option Plan.

NOTE 9 – SUBSEQUENT EVENT

In May 2008, Firstgold issued a convertible debenture in the principal amount of $1,000,000 and bearing interest of 10% per annum.  The Debenture and accrued interest are convertible into shares of Firstgold common stock at a conversion rate of $0.80 per share.  The Debentures are due and payable 20 months 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 1,100,000 shares of Firstgold common stock exercisable at $0.80 per warrant.

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ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OR PLAN OFOPERATIONS

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-KSB as well as throughout this Form 10-Q and should be considered carefully.

Overview

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. Since February 1, 2007 we have completed drilling 83 reverse circulation drill holes .  We have also drilled a total of  57 sonic holes reverse circulation 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 October 2006, we entered into a Mineral Lease Agreement to explore, and, if warranted, develop up to 25,000 acres of property called Antelope Peak located in Elko County, Nevada.  The Lease allows us the exclusive right to explore for, and, if warranted, develop gold, silver and barite minerals on the leased property.  Exploration activity has commenced on this property.

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.  

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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.  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.

Plan of Operations for the Next Twelve Months

Certain key factors and objectives will affect our future financial and operating results.  These include, but are not limited to the following:

●      Gold prices, and to a lesser extent, silver prices;

●      Current mineralization at the Relief Canyon Mine are estimated by us (based on past exploration by Firstgold and work done by others).

●      Our proposed exploration of properties now include 146 mill site and unpatented mining claims contained in about 1,000 acres of the Relief Canyon Property; the 25,000 acre Antelope Peak property; and approximately 4,200 acres in the Horse Creek area of Nevada.

●      Our operating plan is to continue exploration work on the Relief Canyon mining property during calendar 2008.    During 2008, we plan to resume heap leaching at the Relief Canyon mine and we anticipate realizing production revenue from the Relief Canyon mine thereafter.  Through the sale of additional securities and/or the use of joint ventures, royalty arrangements and partnerships, we intend to progressively enlarge the scope and scale of our exploration, mining and processing operations, thereby potentially increasing our chances of locating commercially viable ore deposits which could increase both our annual revenues and ultimately our net profits.  Our objective is to achieve annual growth rates in revenue and net profits for the foreseeable future.

●      We expect to make capital expenditures in calendar years 2008 and 2009 of between $5 million and $10 million, including costs related to the exploration, development and operation of the Relief Canyon mining property.  We will have to raise additional outside capital to pay for these activities and the resumption of exploration activities and possible future production at the Relief Canyon mine.

●      Additional funding or the utilization of other venture partners will be required to fund exploration, research, development and operating expenses at the Horse Creek,  Antelope Peak, Fairview-Hunter and Honorine Gold properties when and if such activity is commenced at these properties. In the past we have been dependent on funding from the private placement of our securities as well as loans from related and third parties as the sole sources of capital to fund operations.

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●      Completion of the ore processing facility at the Relief Canyon site and installation of a new jaw crushing unit.

●      Completion of a state-of-the-art mineral assay laboratory being installed in 10,000 square feet of leased space outside of Lovelock, Nevada.

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) a mineral lease to explore approximately 25,000 acres of property located in Elko County, Nevada; ii) the staking of approximately 4200 acres of property located in Humboldt County, Nevada; (iii) claims to explore 2300 acres of property located near Fairview, Nevada; and (iv) mineral leases on 3300 acres of property located near Winnemucca, Nevada.

Operating Results for the Fiscal Quarters Ended April 30, 2008 and 2007

Although we commenced efforts to re-establish our mining business early in fiscal year 2004, no mining operations have commenced and no revenues from mining operations have been recognized during the quarters ended April 30, 2008 and 2007, respectively.  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 first quarter of fiscal year 2009 we recognized revenue of $275,793 from the leasing of drill rigs and crew to other nearby mining operations.

During the quarter ended April 30, 2008 we spent $1,391,411 for exploration, reclamation and maintenance expenses related to our mining properties.  Reclamation and maintenance expenses expended during the same quarter ended April 30, 2007 were $126,681.  These expenses relate primarily to exploration, maintenance and retention costs required to maintain our mining claims.  The increase in costs was due to extensive building and facility expansion at the Relief Canyon mine and significant exploration drilling.  During the quarter ended April 30, 2008 we expended approximately $56,250 on preliminary exploration activities at the Antelope Peak, Horse Creek, Fairview-Hunter and Honorine Gold properties.  We incurred operating expenses of $1,466,154 during the quarter ended April 30, 2008.  Of this amount, $78,299 reflects promotion expense, $228,460 reflects officer and director compensation during the quarter and $394,378 reflect fees for outside professional services.  $259,798 of the outside professional services reflects legal costs associated with the litigation involving the Crescent Red Caps LLC.    We incurred operating expenses of $985,685 during the quarter ended April 30, 2007.  Of this amount, $222,933 reflects outside director compensation expense, $188,769 reflects promotion expense, $93,500 reflects officer compensation and related payroll taxes during the quarter and $124,533 reflect fees for outside professional services.  

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A large portion of the outside professional services reflects legal and accounting work pertaining to our annual and quarterly reporting on Form 10-KSB and Form 10-QSB occurring in fiscal year 2008 as well as the preparation and filing of a Form SB-2.  It is anticipated that both mining costs and operating expenses will increase significantly as we continue our exploration program and prepare for mining operations.

We incurred interest expense of $34,606 during the quarter ended April 30, 2008 which compares to interest expenses of $247,959 incurred during the same quarter of 2007.  The principal balance of loans outstanding during the first quarter of fiscal year 2009 decreased by $2,827,609 to $950,797 compared to a principal balance of $3,778,406 outstanding at the end of the first quarter of fiscal year 2008, which was primarily the result of a decrease in convertible debentures.  The decrease in interest expense during the quarter ended April 30, 2008 was primarily due to the decrease in the principal balance of loans outstanding during the period offset by the write-off of unamortized debt costs related to convertible debt which was converted in full during the period.

Our total net loss for the quarter ended April 30, 2008 decreased to $2,595,314 compared to a net loss of $2,977,614 incurred for the same quarter ended April 30, 2007.  The larger net loss in the first quarter of fiscal 2008 reflects the increase in the adjustment to fair value of derivatives of $1,623,255.  In addition, the decrease in net loss for the quarter ended April 30, 2008 reflects the net sales revenue recognized during the quarter compared to no revenues recorded in the same quarter of 2007.

Liquidity and Capital Resources

We have incurred significant operating losses since inception and during the three months ended April 30, 2008 which has resulted in an accumulated deficit of $33,986,454 as of April 30, 2008.  At April 30, 2008, we had cash and other current assets of $1,897,342 compared to $1,125,613 at January 31, 2008 and net working capital of $­­­412,145 as of April 30, 2008.  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 April 30, 2008, we had outstanding debentures and notes payable in the gross principal amount of $950,797 (net balance of $817,624 after $(148,480) of deferred financing costs) which reflects a decrease in the gross principal balance of $2,827,609 compared to notes payable in the gross principal amount of $3,778,406, (net balance of $5,958,845 after $(2,365,659) of note payable discount and deferred financing costs and $4,546,098 of derivative liabilities) as of April 30, 2007.

By attempting to resume mining operations, we will require approximately $5 million to $10 million in working capital above the amounts realized during calendar year 2008 to bring the Relief Canyon Mine into full production and carry out planned exploration on our other properties.  We believe we have sufficient working capital to fund our current business plan for Relief Canyon.  However, should additional funds become necessary, our intention would be to pursue several possible funding opportunities including the sale of additional securities, entering into joint venture arrangements, or incurring additional debt.

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Due to our continuing losses from business operations, the independent auditor’s report dated May 15, 2008, 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 April 30, 2008, Firstgold’s principal commitments included its obligation to pay ongoing maintenance fees on 146 unpatented mining claims, the annual minimum rent due on the Winchell Ranch  mineral lease and mortgage payments relating to its offices in Lovelock, Nevada.

It is likely that we will need to raise additional capital to fund the long-term or expanded development, promotion and conduct of our mineral exploration.  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 fund our future operations.  Although we believe that our creditors and investors would continue to fund Firstgold’s expenses if such became necessary based upon their significant debt and/or equity interest in Firstgold, there is no assurance that such investors would continue to pay our expenses in the future.  If adequate funds are not available in the future, through public or private financing as well as borrowing from other sources, Firstgold might not be able to establish or sustain its mineral exploration or mining program.

Recent financing Transactions

During February, March and April of 2008, Firstgold received gross proceeds of $8,042,897 upon the private placement of Units consisting of 12,373,689 shares of common stock and warrants to purchase 6,186,845 shares of common stock at an exercise price of $0.80 per share.   The warrants have a term of 18 months.

On May 1, 2008, we issued a Convertible Debenture in the principal amount of $1,100,000 and bearing interest or 10% per annum. The transaction included the issuance of warrants to purchase 1,100,000 shares of Firstgold common stock at an exercise price of $1.00 per share.

Off-Balance Sheet Arrangements

During the fiscal quarter ended April 30, 2008, Firstgold did not engage in any off-balance sheet arrangements as defined in Item 303(c) of the SEC’s Regulation S-B.

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 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.

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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.

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.

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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.

ITEM 4T.         CONTROLS AND PROCEDURES

Disclosure Controls and Procedures.

Firstgold maintains a set of disclosure controls and procedures designed to ensure that information required to be disclosed in reports that it files or submits under the Securities and Exchange Act of 1934 is recorded, processed, summarized and reported within the time periods specified in Securities and Exchange Commission rules and forms.  In addition, the disclosure controls and procedures ensure that information required to be disclosed is accumulated and communicated to management, including the chief executive officer (CEO) and the chief financial officer (CFO), allowing timely decisions regarding required disclosure.  As discussed in Firstgold’s Annual Report on Form 10-KSB for the year ended January 31, 2008, based on evaluation carried out by the CEO and CFO, of the effectiveness of our disclosure controls and procedures, the CEO and CFO have concluded that Firstgold’s disclosure controls and procedures are ineffective.

Changes in Internal Control Over Financial Reporting.

Firstgold is in the process of developing and implementing remediation plans to address our material weaknesses. Management has taken the following actions described below to improve the internal controls over financial reporting.

• Improve period-end closing procedures by ensuring that account reconciliations and analyses for significant financial statement accounts are prepared on a timely basis and reviewed for completeness and accuracy by qualified accounting personnel.
• Hire additional qualified accounting personnel to create an improved segregation of duties environment.
• Implement a new mining industry based accounting and financial reporting software system to address the expansion of Firstgold’s business.

PART II - OTHER INFORMATION

ITEM 1. LEGAL PROCEEDINGS

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).  The complaint sought the termination of the leasehold rights granted to ASDi, LLC and quiet title and punitive damages. In late March 2008, the parties reached a settlement agreement and the case was dismissed by the Court on April 4, 2008.  

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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 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). Firstgold filed an Answer on April 15, 2008 and on May 5, 2008 filed a Counterclaim seeking reimbursement of all costs of this lawsuit. Firstgold expects to vigorously defend this action.

ITEM 1A. FACTORS AFFECTING FUTURE OPERATING RESULTS

We are a development stage company and an investment in, or ownership position in our common stock is inherently risky.  Some of these risks 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 these risks and investors could lose all or part of an investment in our company as a result of any of these risks 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 future mining and exploration activities.  We currently have cash reserves and a working capital surplus of $412,146 as of April 30, 2008.  However, our ability to fully implement our business plan and 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 cash flows from operations, enter into joint ventures or other arrangements with capital sources, or secure other sources of financing to fund operations. Our continuing reliance on outside capital is a consequence of our negative cash flows from operations.  

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At any time, a serious deficiency in cash flows 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.

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, and January 31, 2007 to include an explanatory paragraph related to our ability to continue as a going concern, stating, in the audit report dated May 15, 2008, that “the Company has incurred a net loss of $7,632,537 and had negative cash flow from operations of $4,832,217.  In addition, the Company had an accumulated deficit of $31,391,142 and a shareholders’ surplus of $5,174,290 at January 31, 2008.”  These factors, among others, as discussed in “Note 2- Going Concern” to the financial statements, raise substantial doubt about our 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 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.

The price of gold has experienced an increase in value over the past five years, generally reflecting among other things relatively low interest rates in the United States; worldwide instability due to terrorism; inflation affecting the US dollar and a slow recovery from the global economic slump.  Any significant drop in the price of gold may have a materially adverse affect on the results of our operations unless we are able to offset such a price drop by substantially increased production.

We have no proven or probable reserves and have no ability to currently measure or prove our reserves other then estimating such reserves relying on information produced in the 1990’s and thus may be unable to actually recover the quantity of gold anticipated.  We have retained SRK Engineering to perform a resource evaluation.  We can only estimate a potential mineral resource which is a subjective process which depends in part on the quality of available data and the assumptions used and judgments made in interpreting such data.  There is significant uncertainty in any resource estimate such that the actual deposits encountered or reserves validated and the economic viability of mining the deposits may differ materially from our expectations.

Gold exploration is highly speculative in nature.  Success in exploration is dependent upon a number of factors including, but not limited to, quality of management, quality and availability of geological data and availability of exploration capital.  Due to these and other factors, the probability of our exploration program identifying individual prospects having commercially significant reserves cannot be predicted.  It is likely that many of the claims explored will not contain any commercially viable reserves.  Consequently, substantial funds will be spent on exploration which may identify only a few, if any, claims having commercial development potential.  In addition, if commercially viable reserves are identified, significant amounts of capital will be required to mine and process such reserves.

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Our mining property rights consist of 146 mill site and unpatented mining claims at the Relief Canyon Mine, our leasehold interest in the Antelope Peak, Fairview-Hunter and Honorine Gold properties, and recently staked claims in the Horse Creek area of Nevada.  The validity of unpatented mining claims is often uncertain and is always subject to contest.  Unpatented mining claims are generally considered subject to greater title risk than patented mining claims, or real property interests that are owned in fee simple.  If title to a particular property is successfully challenged, we may not be able to carryout exploration programs on such property or to retain our royalty or leasehold interests on that property should production take place, which could reduce our future revenues.

Mining is subject to extensive regulation by state and federal regulatory authorities.  State and federal statutes regulate environmental quality, safety, exploration procedures, reclamation, employees’ health and safety, use of explosives, air quality standards, pollution of stream and fresh water sources, noxious odors, noise, dust, and other environmental protection controls as well as the rights of adjoining property owners.  We believe that we are currently operating in substantial compliance with all known safety and environmental standards and regulations applicable to our Nevada property.  However, there can be no assurance that our compliance could not be challenged or that future changes in federal or Nevada laws, regulations or interpretations thereof will not have a material adverse affect on our ability to resume and sustain mining operations.

The business of gold mining is subject to certain types of risks, including environmental hazards, industrial accidents, and theft.  We carry insurance against certain property damage loss (including business interruption) and comprehensive general liability insurance.  While we maintain 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.  We have not obtained environmental liability insurance because such coverage is not considered by management to be cost effective.  We currently carry insurance on our property, plant and equipment as well as comprehensive general liability insurance.

As of May 1, 2008, Firstgold had approximately 130,717,460 shares of Common Stock outstanding and options and warrants to purchase a total of 52,195,756 shares of our Common Stock were outstanding as of May 1, 2008.  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

During February, and March of 2008, Firstgold issued a total of 12,019,843 units at a price of $0.65 per unit.  Each unit consisted of one share of Firstgold common stock and ½ warrant to purchase a share of Firstgold common stock at an exercise price of $0.80 per share.  Firstgold raised gross proceeds of $7,712,797 from the same of the units.  From this amount, Firstgold paid a Selling Agent Fee of $539,896 and issued 1,201,984 broker warrants to the Selling Agent as compensation units.  The warrants expire eighteen (18) months from the date of issuance. These units were offered and sold exclusively to individuals residing or entities formed outside the United States and were not deemed to be “U.S. persons” as that term is defined under Regulation S.  Each investor represented that it was purchasing such shares for its own account.  Both the offer and the sale of the Firstgold shares were made outside the United States and were deemed to be “offshore transactions” as that term is defined under Regulation S under the Securities Act of 1933 (the “Securities Act”).  The share certificates contain a legend indicating that such shares can only be transferred in compliance with the provisions of Regulation S. In light of the foregoing, such sales were deemed exempt from registration pursuant to Regulation S of the Securities Act.  The shares were deemed to be “restricted shares” as defined in Rule 144 under the Securities Act.

In April 2008, Firstgold issued 707,846 units at a price of $0.65 per unit.  Each unit consisted of one share of Firstgold common stock and ½ warrant to purchase a share of Firstgold common stock at an exercise price of $0.80 per share.  The warrants expire (18) months from the date of issuance.  Firstgold raised gross proceeds of $460,100 from the sale of the units and paid a finder’s fee of $32,207. The issuance of stock and warrants were made without any public solicitation to a limited number of investors 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 stock and warrants were issued pursuant to the private placement exemption provided by Section 4(2) and Regulation D there under or Section 4(6) of the Securities Act.  These are deemed to be “restricted securities” as defined in Rule 144 under the Securities Act and the warrant certificates and stock certificates bear a legend limiting the resale thereof.

27

ITEM 5. OTHER INFORMATION

In January 2008, Firstgold filed an application to become listed on the Toronto Stock Exchange (“TSX”).  This application had been pending with the TSX while Firstgold satisfied various listing requirements, including securing additional capital.  Subsequent to the end of the first fiscal quarter, on May 12, 2008, the TSX approved Firstgold’s application for listing its common shares and, effective May 14, 2008, Firstgold’s shares became listed for trading under the symbol “FGD”.  Firstgold’s common stock continues to be listed for trading on the OTC Bulletin Board market under the symbol “FGOC”.

During the quarter ended April 30, 2008, Firstgold adopted a 401k retirement savings plan. The Plan is available to all Firstgold employees and is voluntary. The Plan does not provide for any matching or other contributory obligation by Firstgold. Firstgold will pay the administrative costs of implementing and operating the Plan.

ITEM 6. EXHIBITS

 10.22 Employment Agreement for Stephen Akerfeldt.

 10.23 Revised Employment Agreement for A. Scott Dockter.

 10.24 Voting Trust and Escrow Agreement for A. Scott Dockter.

10.25	Form of Subscription Agreement for Regulation S offering in February 2008.
10.26	Convertible Debenture Dated May 1, 2008

 31.1 Certification of CEO pursuant to Section 302 of the Sarbanes-Oxley Act of2002.

 31.2 Certification of CFO pursuant to Section 302 of the Sarbanes-Oxley Act of2002.

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

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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: June 23, 2008	By:	/s/ Stephen Akerfeldt
		Stephen Akerfeldt, Chief Executive Officer
		/s/ James Kluber
		James Kluber, Principal Accounting Officer and Chief Financial Officer

EX-10.22

Exhibit 10.22

EMPLOYMENT AGREEMENT

 THIS EMPLOYMENT AGREEMENT (the "Agreement") made effective on the 4th day of January, 2008 (the "Effective Date").

BETWEEN:

FIRSTGOLD CORP.

a corporation incorporated pursuant to the laws of Delaware

(hereinafter called the "Company")

-and-

STEPHEN AKERFELDT,

an individual residing in the Province of Ontario

(hereinafter called the "Executive")

WHEREAS the Company has offered to employ the Executive in the position of Chief Executive Officer, upon and subject to the terms and conditions set forth in this Agreement, and the Executive wishes to accept such employment;

NOW THEREFORE in consideration of the mutual covenants herein contained, and for other good and valuable consideration, the parties hereto agree as follows:

TERM

1.           The Executive's employment hereunder shall be for a one (1) year term, commencing on the Effective Date, subject to termination by either party in accordance with the provisions of this Agreement (the "Term"). Notwithstanding the foregoing, this Agreement shall automatically renew for successive one (1) year terms (each, a "Successive Term") unless the Company provides no less than sixty (60) days written notice to the Executive (a "Non-Renewal Notice") notifying the Executive that the Agreement shall conclude upon the expiration of the Term or Successive Term, as the case may be, and not automatically renew.

DUTIES

2.           The Executive shall serve the Company in the capacity of Chief Executive Officer and shall perform such duties and exercise such powers pertaining to the management and operation of the Company as may be determined from time to time by the board of directors of the Company, consistent with the office of Chief Executive Officer. The Executive shall perform those duties that may reasonably be assigned to him, diligently and faithfully to the best of his abilities. The Executive shall devote such amount of working time and attention to the business affairs of the Company as is required (as determined by the Company, acting in good faith) to perform the functions consistent with the office of Chief Executive Officer, it being acknowledged that the Executive acts as independent director to certain other companies and is also involved in the management of Ritz Plastics, Inc. The Executive further acknowledges that he is bound to follow the policies and procedures established by the Company, from time to time, including any code of business conduct adopted by the Company (including any future revisions of such policy or procedure and code of conduct). In carrying out his duties and responsibilities as Chief Executive Officer of the Company, the Executive shall comply with all lawful instructions as may be given from time to time by the Company.

COMPENSATION

3.           The Executive shall be entitled to salary and bonuses, as follows:

(a)           Salary. The Executive shall receive a base salary in the amount of USD$250,000 per annum, payable in accordance with the Company's normal payroll cycle.

(b)           Bonus. In addition to the Executive's base salary, the Executive shall be eligible to participate in any discretionary employee bonus plan, which is implemented by the Company in its sole and unfettered discretion, at a level commensurate with his position.

(c)           Options. The Company and Executive agree that the Executive shall receive options to purchase 250,000 common shares of the Company pursuant to the Company's stock option plan. In the event Executive's employment is terminated other than for cause, the term of the options shall extend for a period of twelve months from the termination date, and the vesting provisions of such options shall continue to run for such twelve-month period.

BENEFITS

4.           The Executive shall be entitled to participate in all of the Company's benefit plans generally available to its senior level employees from time to time. The Executive's rights under these benefit plans shall be determined entirely by the terms and conditions of the plans and the Executive shall have no independent rights as against the Company in connection with the said benefits.

VACATION

5.           During his employment hereunder, the Executive shall be entitled to six (6) weeks paid vacation per calendar year, to be scheduled at such times as are acceptable to the board of directors of the Company having regard to the business requirements of the Company

EXPENSES

6.           The Executive shall be reimbursed at cost for all reasonable travel, cell phone and other out-of-pocket expenses, which the Executive incurs in connection with carrying out his duties hereunder, in accordance with and subject to the terms of Company's expense policy, as amended from time to time. For all such expenses the Executive shall furnish the Company with appropriate receipts.

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TERMINATION

7.            For Cause. The Company may terminate the employment of the Executive for cause, without notice or any payment in lieu thereof. "Cause" shall mean just cause at common law.

8.           Without Cause. The Company may terminate the Executive's employment at any time without just cause provided, however, that in the event of such termination without cause, the Company shall provide the Executive with the following payments and benefits, in lieu of notice:

(a) the Company shall pay to the Executive the amount of all outstanding salary and bonuses earned by the Executive under section 3 hereof to the date of termination;

(b) the Company shall pay to the Executive a lump sum payment equal to three (3) months of the Executive's then current annual base salary for each year or portion thereof that the Executive has been employed by the Company in the capacity of Chief Executive Officer. For clarity, during the first (1st) year (or portion thereof) of the Executive's employment pursuant to this Agreement, the Executive shall be entitled to a lump sum payment equal to three (3) months of the Executive's then current annual base salary. During the second (2nd) year (or portion thereof) of the Executive's employment pursuant to this Agreement, the Executive shall be entitled to a lump sum payment equal to six (6) months of the Executive's then current annual base salary, etc.;

The lump sum payments referred to above shall be paid within thirty (30) calendar days of the termination of the Executive's employment.

It is acknowledged by the Executive that delivery of a Non-Renewal Notice shall not constitute termination without cause pursuant to this Section 8 and shall not entitle the Executive to any termination payment, other than payment of all outstanding salary and bonuses earned by the Executive under section 3 hereof to the date of expiration of the Agreement.

The Executive acknowledges and agrees that payment by the Company as provided for in

Section 8 shall be in full and final settlement of any and all claims, demands, actions and suite whatsoever which the Executive has or may have against the Company, its affiliates and any of their directors, officers, employee and their successors and assigns. The Executive further agrees, that if required by the Company, he will sign a release in favor of the Company.

9.           Resignation by Executive. The Executive may terminate his employment hereunder at any time, by giving to the Company two (2) months written notice of his intention to resign. The Company may waive all or a part of such notice provided, however, that the Executive shall be paid the amount of any salary, bonus and benefits that would have been earned by him, had he continued to work until the expiry of such two (2) months notice of resignation.

- 3 -

10.           Termination upon Death or Disability. The employment of the Executive and this Agreement shall automatically terminate without liability to the Company beyond amounts due and owing through the date of the termination, provided that (i) if death or disability occurs in the course of the Executive carrying out his duties as Chief Executive Officer, such occurrence shall be deemed a termination without cause and the Executive shall have the benefits contemplated under Section 8 hereof, and (ii) nothing hereunder shall disentitle the Executive or the Executive's estate or beneficiaries to any entitlements that would properly arise as a result of the death or disability of the Executive under the terms of any applicable benefits plan, upon the happening of any of the following:

(a) the death of the Executive;

(b) the Executive remaining totally disabled, as that term is defmed in any long term disability plan in effect for employees of the Company (or, if such plan is not in effect, meaning the Executive's physical or mental incapacity which, in the reasonable, good faith determination of the board of directors of the Company, renders him incapable of carrying out her duties under this Agreement), for a consecutive period of one hundred and twenty (120) days or a cumulative period of one hundred and twenty (120) days in any six (6) month period, subject to the provisions of the Ontario Human Rights Code. Any statutorily required payments due to the Executive shall be payable as per the applicable legislation. All other payments due to the Executive shall be payable as prescribed with this Agreement or within thirty (30) calendar days of receipt of an executed release.

11.           Termination upon Change ofControl. In the event the Company experiences a change in control through the purchase of over fifty percent (50%) of the Company's issued and outstanding shares by a third party, or corporate reorganization having the same effect, and notice of termination is given by the Company within 6 months thereafter, then the lump sum payment stipulated in 8(b) above shall be increased to 18 months, and stock options with vesting provisions will vest immediately.

CONFIDENTIALITY

12.  The Executive acknowledges and agrees that he will not, during his employment hereunder and following the termination of such employment, whether voluntary or involuntary, directly or indirectly disclose to any person or in any way make use of (other than for the benefit of the Company), any confidential information concerning the business and affairs of the Company. Nothing in this section shall preclude the Executive from disclosing such information if such disclosure is required by law or a court of competent jurisdiction.

MISCELLANEOUS

13.           Amendment. If both parties agree, this agreement may be amended in whole or in part, as long as any such amendments are in writing and signed by the parties hereto.

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14.           Governing Law. This Agreement shall be governed by and construed in accordance with the laws of the Province of Ontario, and the federal laws applicable therein.

15.           Successors and Assigns. This Agreement shall be binding on and enure to the benefit of the successors and assigns of the Company.

16.           Notices. Any notice or other communication required or permitted to be given hereunder shall be in writing and either delivered by hand, mailed by prepaid registered mail or sent by facsimile or other electronic communication. At any time other than during a general discontinuance of postal service due to strike, lock-out or otherwise, a notice so mailed shall be deemed to have been received three business days after the postmarked date thereof or, if delivered by hand, shall be deemed to have been received at the time it is delivered or, if delivered by facsimile or other electronic communication, shall be deemed to have been received on the next business day after it is sent. If there is a general discontinuance of postal service due to strike, lock-out or otherwise, a notice sent by prepaid registered mail shall be deemed to have been received three business days after the resumption of postal service. Notice shall be addressed as follows:

(a)	If to the Company:
	3108 Ponte Morino Dr.
	Suite 210
	Cameron Park, CA 95682
	Email: info@frrstgoldcorp.com

(b) If to the Executive, the last address of the Executive in the records of the Company.

17.           Withholdings. If required by applicable law, all taxable amounts set forth ill this Agreement are subject to applicable withholding or source deductions.

18.           Entire Agreement. This Agreement constitutes the entire agreement and understanding of the parties hereto, with respect to the subject matter hereof, and supersedes all prior written or verbal agreements and understandings between the Company and the Executive relating to such subject matter.

IN WITNESS WHEREOF the parties hereto have executed this Agreement as of the date first above written.

	FIRSTGOLD CORP.
/s/Stephen Akerfeldt	Per:	/s/Stephen Akerfeldt
Stephen Akerfeldt		Authorized Signatory

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EX-10.23

Exhibit 10.23

EMPLOYMENT AGREEMENT

THIS EMPLOYMENT AGREEMENT (the "Agreement") made effective on the    second    day of   January  , 2008 (the "Effective Date").

BETWEEN:

FIRSTGOLD CORP.,

a corporation incorporated pursuant to the laws of Delaware

(hereinafter called the "Company")

-and-

A.  SCOTT DOCKTER,

an individual residing in the State of California

(hereinafter called the "Executive")

WHEREAS the Executive has been employed by the Company in the position of Chief Executive Officer and President pursuant to an Employment Agreement dated the 1st day of February, 2006 (the "Prior Agreement");

AND WHEREAS the Executive and the Company wish to amend the terms by which the Executive is employed by the Company to provide for, among other things, revised employment terms including additional base salary for the Executive, and, in connection therewith, the Executive and the Company have agreed to terminate the Prior Agreement and replace same with the terms herein contained;

NOW THEREFORE in consideration of the mutual covenants herein contained, and for other good and valuable consideration (including, without limitation, revised employment terms including additional base salary for the Executive), the parties hereto agree as follows:

TERM

1.           The Executive's employment shall commence on the Effective Date and, subject to termination by either party in accordance with the provisions of this Agreement, shall conclude on the 31st day of January, 2009 (the "Initial Term"). Notwithstanding the foregoing, this Agreement shall automatically renew for successive one (1) year terms (each, a "Successive Term") unless the Company provides no less than sixty (60) days written notice (a "Non-Renewal Notice") to the Executive notifying the Executive that the Agreement shall conclude upon the expiration of the Initial Term or Successive Term, as the case may be, and not automatically renew.

DUTIES

2.           The Executive shall serve the Company in the capacity of Chief Operating Officer and shall perform such duties and exercise such powers pertaining to the management and operation of the Company as may be determined from time to time by the board of directors and Chief Executive Officer of the Company, consistent with the description set forth in Schedule A attached hereto. The Executive shall perform those duties that may reasonably be assigned to him, diligently and faithfully to the best of ·his abilities. The Executive shall devote such amount of working time and attention to the business affairs of the Company as is required (as determined by the Company, acting in good faith) to perform the functions consistent with the office of Chief Operating Officer. The Executive further acknowledges that he is bound to follow the policies and procedures established by the Company, from time to time, including any code of business conduct adopted by the Company (including any future revisions of such policy or procedure and code of conduct). Incarrying out his duties and responsibilities as Chief Operating Officer of the Company, the Executive shall comply with all lawful instructions as may be given from time to time by the Company.

COMPENSATION

3.           The Executive shall be entitled to salary and bonuses, as follows:

(a)           Salary. The Executive shall receive a base salary in the amount of USD$225,000 per annum, payable in accordance with the Company's normal payroll cycle, which base salary shall be reviewed at least annually by the board of directors of the Company. The board of directors shall have sole discretion and authority to increase the Executive's base salary, although, at a minimum, the Executive shall be entitled to an annual base salary adjustment based on the annual change in the United States Consumer Price Index.

(b)           Bonus. Inaddition to the Executive's base salary, the Executive shall be eligible to participate in any discretionary employee bonus plan or other plan, which is implemented by the Company in its sole and unfettered discretion, at a level commensurate with his position.

(c)           Stock Option Plan. Upon establishment of a Company stock option plan, the Executive will participate, according to the terms and conditions thereof, to the same degree as other Company employees of like grade and status.

BENEFITS

4.           The Executive shall be entitled to participate in all of the Company's benefit plans generally available to its senior level employees from time to time. The Executive's rights under these benefit plans shall be determined entirely by the terms and conditions of the plans and the Executive shall have no independent rights as against the Company in connection with the said benefits.

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VEHICLE ALLOWANCE

5.           The Company shall provide the Executive with a company-owned vehicle for use in connection with services provided hereunder.

VACATION

6.           During his employment hereunder, the Executive shall be entitled to four (4) weeks paid vacation per calendar year, to be scheduled at such times as are acceptable to the board of directors of the Company having regard to the business requirements of the Company

EXPENSES

7.           The Executive shall be reimbursed at cost for all reasonable travel, cell phone and other out-of-pocket expenses, which the Executive incurs in connection with carrying out his duties hereunder, in accordance with and subject to the terms of Company's expense policy, as amended from time to time. For all such expenses the Executive shall furnish the Company with appropriate receipts.

TERMINATION

8.            For Cause. The Company may terminate the employment of the Executive for cause, without notice or any payment in lieu thereof. "Cause" shall mean just cause at common law.

9.           Without Cause. The Company may terminate the Executive's employment at any time without just cause provided, however, that in the event of such termination without cause, the Company shall provide the Executive with the following payments and benefits, in lieu of notice:

(a) the Company shall pay to the Executive the amount of all outstanding salary and bonuses earned by the Executive under section 3 hereof to the date of termination;

(b) the Company shall pay to the Executive a lump sum payment equal to three (3) months of the Executive's then current annual base salary for each year or portion thereof that the Executive has been employed by the Company in the capacity of Chief Operating Officer, or prior thereto, as Chief Executive Officer and President.

The lump sum payments referred to above shall be paid within thirty (30) calendar days of the termination of the Executive's employment.

It is acknowledged by the Executive that delivery of a Non-Renewal Notice shall not constitute termination without cause pursuant to this section 9 and shall not entitle the Executive to any termination payment, other than payment of all outstanding salary and bonuses earned by the Executive under section 3 hereof to the date of expiration of the Agreement.

The Executive acknowledges and agrees that payment by the Company as provided for in Section 8 shall be in full and final settlement of any and all claims, demands, actions and suite whatsoever which the Executive has or may have against the Company, its affiliates and any of their directors, officers, employee and their successors and assigns. The Executive further agrees, that if required by the Company, he will sign a release in favour of the Company.

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10.           Resignation by Executive. The Executive may terminate his employment hereunder at any time, by giving to the Company two (2) months written notice of his intention to resign. The Company may waive all or a part of such notice provided, however, that the Executive shall be paid the amount of any salary, bonus and benefits that would have been earned by him, had he continued to work until the expiry of such two (2) months notice of resignation.

11.           Termination upon Death or Disability. The employment of the Executive and this Agreement shall automatically terminate without liability to the Company beyond amounts due and owing through the date of the termination, provided that (i) if death or disability occurs in the course of the Executive carrying out his duties as Chief Operating Officer, such occurrence shall be deemed a termination without cause and the Executive shall have the benefits contemplated under Section 8 hereof, and (ii) nothing hereunder shall disentitle the Executive or the Executive's estate or beneficiaries to any entitlements that would properly arise as a result of the death or disability of the Executive under the terms of any applicable benefits plan, upon the happening of any of the following:

(a) the death of the Executive;

(b) the Executive remaining totally disabled, as that term is defined in any long term disability plan in effect for employees of the Company (or, if such plan is not in effect, meaning the Executive's physical or mental incapacity which, in the reasonable, good faith determination of the board of directors of the Company, renders him incapable of carrying out her duties under this Agreement), for a consecutive period of one hundred and twenty (120) days or a cumulative period of one hundred and twenty (120) days in any six (6) month period, subject to the provisions of the Ontario Human Rights Code. Any statutorily required payments due to the Executive shall be payable as per the applicable legislation. All other payments due to the Executive shall be payable as prescribed with this Agreement or within thirty (30) calendar days of receipt of an executed release.

12.           Termination upon Change of Control. Inthe event the Company experiences a change in control through the purchase of over fifty percent (50%) of the Company's issued and outstanding shares by a third party, or corporate reorganization having the same effect, and notice of termination is given by the Company within 6 months thereafter, then the lump sum payment stipulated in 9(b) above shall be increased to 18 months, and stock options with vesting provisions will vest immediately.

CONFIDENTIALITY

13.           The Executive acknowledges and agrees that he will not, during his employment hereunder and following the termination of such employment, whether voluntary or involuntary, directly or indirectly disclose to any person or in any way make use of (other than for the benefit of the Company), any confidential information concerning the business and affairs of the Company. Nothing in this section shall preclude the Executive from disclosing such information if such disclosure is required by law or a court of competent jurisdiction.

- 4 - -

MISCELLANEOUS

14.           Amendment. If both parties agree, this agreement may be amended in whole or in part, as long as any such amendments are in writing and signed by the parties hereto.

15.           Governing Law. This Agreement shall be governed by and construed in accordance with the laws of the State of California, and the federal laws applicable therein.

16.           Successors and Assigns. This Agreement shall be binding on and enure to the benefit of the successors and assigns of the Company.

17.           Notices. Any notice or other communication required or permitted to be given hereunder shall be in writing and either delivered by hand, mailed by prepaid registered mail or sent by facsimile or other electronic communication. At any time other than during a general discontinuance of postal service due to strike, lock-out or otherwise, a notice so mailed shall be deemed to have been received three business days after the postmarked date thereof or, if delivered by hand, shall be deemed to have been received at the time it is delivered or, if delivered by facsimile or other electronic communication, shall be deemed to have been received on the next business day after it is sent. If there is a general discontinuance of postal service due to strike, lock-out or otherwise, a notice sent by prepaid registered mail shall be deemed to have been received three business days after the resumption of postal service. Notice shall be addressed as follows:

(a) If to the Company:

3108 Ponte Morino Dr.

Suite 210

Cameron Park, CA 95682

Attention: Chief Executive Officer

(b) If to the Executive, the last address of the Executive In the records of the Company.

18.           Withholdings. All taxable amounts set forth in this Agreement are subject to applicable withholding or source deductions.

19.           Entire Agreement. This Agreement constitutes the entire agreement and understanding of the parties hereto, with respect to the subject matter hereof, and supersedes all prior written or verbal agreements and understandings between the Company and the Executive relating to such subject matter.

- 5 - -

IN WITNESS WHEREOF the parties hereto have executed this Agreement as of the date first above written.

	FIRSTGOLD CORP.
/s/ A. Scott Dockter	Per:	/s/ Stephen Akerfeldt
A. Scott Dockter		Authorized Signatory

- 6 - -

SCHEDULE A

The Chief Operating Officer shall have, subject always to the general or specific instructions and directions of the Chief Executive Officer, full power and authority to oversee the operations of the Company (except only the matters and duties as by law must be transacted or performed by the Board of Directors or by the shareholders of the Company in general meeting), and to perform such duties and exercise such powers generally performed or exercised by chief operating officers, as may be assigned to him, from time to time, by the Chief Executive Officer or the Board of Directors of the Company, as the case may be.

The Chief Operating Officer shall provide timely reports to the Chief Executive Officer, on the general affairs of the Company, including changes in strategy, changes in material contracts, emergence of sensitive customer or regulatory issues and a monthly written report to the Chief Executive Officer with financial results and highlights and a commentary on operations.

The Chief Operating Officer shall conform to all lawful instructions and directions given to him by the Chief Executive Officer from time to time, and obey and carry out the policies, practices and procedures of the Company, as they exist from time to time.

EX-10.24

Exhibit 10.24

VOTING TRUST AND ESCROW AGREEMENT

THIS AGREEMENT dated the eighth day of May, 2008.

BETWEEN

FIRSTGOLD CORP.

a corporation incorporated

under the laws of Delaware

(hereinafter called "Firstgold")

OF THE FIRST PART

And

A. SCOTT DOCKTER

(hereinafter called "Dockter")

OF THE SECOND PART

And

EQUITY TRANSFER & TRUST COMPANY

(hereinafter called the "Trustee")

OF THE THIRD PART

WHEREAS:

A.           Pursuant to this Voting Trust and Escrow Agreement (the "Agreement"), Dockter agrees to deliver for transfer to the Trustee 2,943,641 fully paid common shares in the capital of Firstgold, which constitutes all of his direct and beneficial shareholdings in the capital of Firstgold that are unsecured (the "Unsecured Shares"), together with a duly completed power of attorney to transfer such shares with signature guaranteed by either a Canadian Schedule I Chartered Bank or a financial institution that is a member of a recognized STAMP Medallion Signature Guarantee Program, and 4,329,000 fully paid common shares in the capital of Firstgold that are subject to security and pledge agreements (the "Secured Shares"), which constitutes all of his direct and beneficial holdings in the capital of Firstgold that are secured and not presently available for transfer to the Trustee. The Trustee shall register such Unsecured Shares in the name of "Equity Transfer & Trust Company, as Voting Trustee", and the Secured Shares shall be so registered as and when they are delivered to the Trustee for transfer in accordance with paragraph 2 hereof.

B.           The Unsecured Shares transferred to the Trustee and the Secured Shares upon transfer to the Trustee in accordance with the terms hereof are herein called the "Trust Shares".

NOW THEREFORE THIS AGREEMENT WITNESSES that in consideration of the premises and the covenants herein contained, the parties agree as follows:

1.           By execution hereof, Dockter hereby agrees to transfer to the Trustee the Trust Shares, to be held in trust by the Trustee in accordance with the terms contained herein. The Trustee agrees to hold the Trust Shares in its name or in the name of its nominee and vote or cause to bevoted the Trust Shares in the manner herein provided.

2.           Dockter hereby acknowledges and agrees that should any security underlying the Secured Shares be discharged, upon such discharge the Secured Shares so released to Dockter or should Dockter acquire any additional common shares in the capital of Firstgold ("Additional Shares"), he shall forthwith deliver for transfer with a duly completed power of attorney to transfer such Additional Shares and Secured Shares to the Trustee in order to cause such Additional Shares and Secured Shares to be subject to the terms and conditions of this Agreement.

3.           In the event Dockter shall hold, at anytime during the term of this Agreement, in excess of 10% of the outstanding shares in the share capital of Firstgold, on a fully diluted basis, Dockter hereby agrees not to acquire additional shares of Firstgold, or other securities convertible into shares of Firstgold, other than ratably with other shareholders, it being understood that the foregoing restriction is intended to maintain Dockter's pro rata interest in Firstgold. Notwithstanding the foregoing, Dockter shall be permitted to acquire common shares issued on the exercise of stock options granted in the normal course in accordance with Firstgold's stock option plan, or on the exercise of outstanding share purchase warrants, which shall be aggregated with his shareholdings in determining his right to participate ratably with other shareholders. For greater certainty, neither the Trustee nor the transfer agent for Firstgold will be responsible or liable for ensuring Dockter's compliance with this provision and the Trustee will only be required to take notice of the common shares that are actually deposited with it.

4.           Nothing herein shall be construed so as to preclude Dockter from disposing of any or all of the Trust Shares (the "Sold Shares") on the open market to a non-related or unassociated third party (within the meaning given to such terms in the Securities Act (Ontario) and Regulation 61101 - Respecting protection of minority security holders in special transactions) purchasers (each a "Purchaser") and the Trustee hereby undertakes to transfer the ownership of such Sold Shares over to the Purchaser's broker as directed by Dockter upon delivery of a signed certificate, in the form annexed hereto as Schedule "A", confirming that such sale is on the open market to an unrelated or unassociated party.

5.           The Trustee hereby agrees to vote the Trust Shares in such manner as may from time to time be directed by Dockter; provided, however that the number of votes so exercised shall at no time exceed 9.9% of the votes, attached to the common shares in the capital of Firstgold, eligible to be cast at any meeting of shareholders of Firstgold, and the remaining Trust Shares shall not be voted. Dockter further agrees that no votes may be cast in respect of Secured Shares, that, when aggregated with the Trust Shares, would exceed 9.9010 of the votes attached to the common shares in the capital of Firstgold, eligible to be cast at any meeting of shareholders of Firstgold, and the Trustee expressly disclaims any responsibility or duty with repect to this covenant. Firstgold covenants to provide the Trustee with an Officer's Certificate, forthwith after the mailing of the notice of any meeting of the common shareholders, certifying to it the total number of Trust Shares that may be voted at the upcoming meeting.

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6.           The Trustee shall not incur any liability or responsibility hereunder by reason of any error of law or mistake or any matter or thing done or omitted to be done under or in relation to this Agreement and the trust hereby created except by its own willful neglect or default in carrying out its obligations hereunder.

7.           Firstgold and Dockter each agree to jointly and severally indemnify the Trustee, and its directors, officers, employees and agents and save them harmless from and against all claims, actions, suits, loss or damage which may be incurred or suffered by the Trustee in the proper performance of its duties as Trustee hereunder. This indemnification will survive the termination or discharge of this Agreement and the resignation or removal of the Trustee.

8.           Firstgold covenants to pay the Trustee's reasonable remuneration for all the services to be performed by it hereunder and for any costs and expenses (including the charges of its nominee and the reasonable compensation and disbursements of its counsel and other advisors) incurred by the Trustee in the performance of such services. The Trustee shall not be required to effect any partial or full release of the shares unless its fees and expenses are paid in full.

The Trustee shall be fully protected in acting and relying on any document, certificate, statement, instrument, opinion, report or notice, believed by it to be genuine and to have been signed, sent by or on behalf of the proper party or parties or delivered to it pursuant to this Agreement as to its due execution, validity and effectiveness and as to the truth and accuracy of any information contained therein.

The Trustee will have the right not to act and will not be liable for refusing to act unless it has received clear and reasonable documentation that complies with the terms of this Agreement. Such documentation must not require the exercise of any discretion or independent judgment.

The Trustee may resign and be discharged from all further duties and liabilities hereunder, by giving to Firstgold and Dockter not less than 30 days' prior notice in writing or such shorter prior notice as they may accept as sufficient. In the event of the Trustee resigning or being dissolved, becoming bankrupt, going into liquidation or otherwise becoming incapable of acting hereunder, Firstgold and Dockter shall forthwith appoint a new trustee; failing such appointment by them, the retiring Trustee, at the expense of Firstgold, may apply to a justice of the Ontario Superior Court of Justice on such notice as such justice may direct, for the appointment of a new trustee. On any such appointment the new trustee shall be vested with the same powers, rights, duties and responsibilities as if it had been originally named herein as trustee hereunder.

9.           This Agreement shall, subject to the written consent of Toronto Stock Exchange (the "TSX"), terminate forthwith upon the expiration of three (3) years from the date hereof and upon termination of this Agreement and after receipt by the Trustee of payment of any remuneration to which it may then be entitled hereunder, including any costs and expenses, the Trustee will transfer the Trust Shares to or to the order of Dockter. This Agreement may not be amended without the prior written consent of the TSX.

10.            Any monies received by the Trustee from Firstgold by way of cash dividend or return of capital on the Trust Shares shall be distributed to Dockter. Any distribution of stock arising from a stock split, stock dividend or corporate reorganization shall be subject to the terms of this Agreement.

11.           This Agreement shall be construed in accordance with the laws of the Province of Ontario and the laws of Canada applicable therein.

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12.           This Agreement may be executed in several parts in the same form and such parts as so Executed shall together form one original agreement, such parts if more than one shall be read together and construed as ifall signing parties hereto had executed one copy of this Agreement.

13.            Any notices given hereunder shall be deemed to besufficiently given if sent to:

Trustee:

Equity Transfer & Trust Company

200 University Avenue, Suite 400

Toronto, ON

M5H 4Hl

Attention: Manager, Corporate Trust Department

Fax: 416-361-0470

Firstgold:

Firstgold Corp.

Corporate Headquarters

3108 Ponte Morino Dr.

Suite 210

Cameron Park, CA 95682

Attention: Stephen Akerfeldt

Fax: [1-530-677-7626 ]

Dockter:

c/o

Firstgold Corp.

Corporate Headquarters

3108 Ponte Morino Dr.

Suite 210

Cameron Park, CA 95682

Attention: Mr. Scott Dockter

Fax: [1-530-677-7626 ]

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IN WITNESS WHEREOF the parties hereto have executed this Agreement.

	FIRSTGOLD CORP.
	By:	/s/ Stephen Akerfeldt
		Stephen Akerfeldt
/s/		/s/ A. Scott Dockter
Witness		A. Scott Dockter

EQUITY TRANSFER & TRUST COMPANY
By:	/s/ Carol Mikos
	Authorized Signatory
By:	/s/ Shelley Martin
	Authorized Signatory

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Schedule "A"

Direction to Transfer

To:  Equity Transfer & Trust Company, as Trustee  200 University Avenue, Suite 400 Toronto, ON M5H 4Hl Attention: Manager, Corporate Trust Department

Re: Voting Trust and Escrow Agreement dated as of May [   ],2008 between Firstgold Corp., A. Scott Dockter, and Equity Transfer & Trust Company

Pursuant to Section 4 of the referenced Agreement, the undersigned hereby certifies that [] common shares of Firstgold Corp. have been sold on the open market to a non-related or unassociated third party (within the meaning given to such terms in the Securities Act (Ontario) and Regulation 61-101 - Respecting protection of minority security holders in special transactions) and accordingly, requests that the Trustee transfer the equivalent number of Trust Shares to the party named below and this shall be your good and sufficient authority for doing so.

Registration:

Address:

Please deliver such common shares to:

Dated this [    ] day of [       ], 200

A.Scott Dockter

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Scott Dockter Summary of Outstanding Shares

1,329,000	Pledged to Triangle Equities
1,000,000	Pledged to Triangle Equities
2,000,000	Pledged to Stern Capital
40,000	On account with Finance 500
1,882,934	On account with Finance 500
900,000	On account with Finance 500
6,200	In possession
38,236	In possession
76,271	In possession

Total shares In security/pledge agreements	4,329,000
Total shares to be transferred to voting trust	2,943,541

EX-10.25

Exhibit 10.25

FIRSTGOLD CORP.

SUBSCRIPTION AGREEMENT FOR UNITS

(For British Columbia, Alberta, Ontario and Offshore Subscribers)

TO:	FIRSTGOLD CORP. (the “Corporation”)
AND TO:	D&D SECURITIES COMPANY (the “Agent”)

The undersigned (the “Subscriber”) hereby irrevocably subscribes for and agrees to purchase from the Corporation that number of units of the Corporation (each, a “Unit”) set out below at a price of US$0.65 per Unit. Each Unit consists of one common share in the capital of the Corporation (each, a “Share”) and one-half of one common share purchase warrant (each whole common share purchase warrant, a “Warrant”).  Each Warrant will entitle the holder thereof to purchase one common share of the Corporation (each, a “Warrant Share”) at a price of US$0.80 per Warrant Share (the “Exercise Price”) for a period of 18 months from the Closing Date (as hereinafter defined).

The Subscriber agrees to be bound by the terms and conditions set forth in the attached “Terms and Conditions of Subscription for Units” including without limitation the representations, warranties and covenants set forth in the applicable schedules attached thereto. The Subscriber further agrees, without limitation, that the Corporation and theAgent (as hereinafter defined) may rely upon the Subscriber’s representations, warranties and covenants contained in such documents.

Please print all information (other than signatures), as applicable, in the space provided below

	Number of Units:X US$0.65
(Name of Subscriber)
	Aggregate Subscription Price:
(Account Reference, if applicable)	("Subscription Price")
Per:
(Authorized Signature)	If the Subscriber is signing as agent for a beneficial purchaser ("Disclosed Principal") and is not a trust  company or portfolio manager, in either case, purchasing as trustee or agent for accounts fully managed by it, complete the following:
(Official Capacity of Title, if Subscriber is not an individual)
(Name of individual whose signature appears above if different  from the name of the Subscriber printed above.)	(Name of Disclosed Principal)
(Subscriber's Residential Address/Unit & Street)	(Disclosed Principal's Residential Address (Unit & Street)
(Municipality, Province, Postal Code)	(Municipality, Province, Postal Code)
(Subscriber's Fax Number)	(Disclosed Principal's Fax Number)
(Subscriber's Telephone Number)	(Disclosed Principal's Telephone Number)
Registered Shareholder Information (if different from Subscriber):	Delivery Instructions as set forth below:
(Name)	(Name)
(Account Reference, if applicable)	(Account Reference, if applicable)
(Address/Unit & Street)	(Address/Unit & Street)
(Municipality, Province, Postal Code)	(Municipality, Province, Postal Code)
	(Contact Name)     (Telephone Number)

ACCEPTANCE: The Corporation hereby accepts the subscription as set forth above on the terms and conditions contained in this Subscription Agreement and the Corporation represents and warrants to the Subscriber that the representations and warranties made by the Corporation to the Agent in the Agency Agreement (as defined herein) are true and correct in all material respects as of the Closing Date (as defined herein) and that the Subscriber is entitled to rely thereon and on the terms, conditions and covenants contained in the Agency Agreement (save and except as waived by the Agent) as if the Subscriber were a party thereto.

    This         day of           , 2008 FIRSTGOLD CORP.   (Authorized Signatory)

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TERMS AND CONDITIONS OF SUBSCRIPTION FOR

UNITS

ARTICLE 1 -  INTERPRETATION

1.1   Definitions

Whenever used in this Subscription Agreement, unless there is something in the subject matter or context inconsistent therewith, the following words and phrases shall have the respective meanings ascribed to them as follows:

“Agency Agreement” means the agency agreement to be entered into between  the Agent and the Corporation in respect of the Offering.

“Agent”means D&D Securities Company, together with any of its affiliates and any other investment dealers included in the syndicate for the Offering.

“Business Day” means a day other than a Saturday, Sunday or any other day on which the principal chartered banks located in Toronto are not open for business.

“Closing” shall have the meaning ascribed to such term in Section 4.1.

“Closing Date” shall have the meaning ascribed to such term in Section 4.1.

“Closing Time” shall have the meaning ascribed to such term in Section 4.1.

“Common Shares” means shares of common stock of the Corporation as constituted on the date hereof.

“Corporation” means Firstgold Corp. and includes any successor corporation to or of the Corporation.

“Disclosed Principal” shall have the meaning ascribed to such term on the face page of this Subscription Agreement.

“Exercise Price” shall have the meaning ascribed to such term on the face page of this Subscription Agreement.

“NI 45-106” shall have the meaning ascribed to such term in Section 5.1(j)(i).

“Offering” means the offering of up to a maximum of 7,692,307 Units.

“person” means any individual (whether acting as an executor, trustee administrator, legal representative or otherwise), corporation, firm, partnership, sole proprietorship, syndicate, joint venture, trustee, trust, unincorporated organization or association, and pronouns have a similar extended meaning.

“SEC” means the United States Securities and Exchange Commission.

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“Securities” means, collectively, the Units, the Shares, the Warrants and the Warrant Shares.

“Securities Laws” means the securities laws, instruments, regulations, rules, rulings and orders in the provinces of British Columbia, Alberta, and Ontario and in the United States of America, as applicable, and the policy statements issued by the Securities Regulators.

“Securities Regulators” means the securities regulatory authorities or securities commissions in the provinces of British Columbia, Alberta and Ontario and the SEC.

“Shares” shall have the meaning ascribed to such term on the face page of this Subscription Agreement.

“Subscriber” means the subscriber for the Units as set out on the face page of this Subscription Agreement.

“Subscription Agreement” means this subscription agreement (including any schedules hereto) and any instrument amending this Subscription Agreement; “hereof”, “hereto”, “hereunder”, “herein” and similar expressions mean and refer to this Subscription Agreement and not to a particular Article or Section; and the expression “Article” or “Section” followed by a number means and refers to the specified Article or Section of this Subscription Agreement.

“Subscription Price” shall have the meaning ascribed to such term on the face page of this Subscription Agreement.

“United States” means the United States of America, its territories and possessions, any State of the United States and the District of Columbia.

“Units” shall have the meaning ascribed to such term on the face page of this Subscription Agreement.

“U.S. Person” means a U.S. Person as that term is defined in Rule 902(k) of Regulation S under the U.S. Securities Act.

“U.S. Securities Act” means the United States Securities Act of 1933, as amended.

“Warrants” means the Common Share purchase warrants forming part of the Units.

“Warrant Shares” means the Common Shares issuable upon exercise of the Warrants.

1.2   Gender and Number

Words importing the singular number only shall include the plural and vice versa, words importing the masculine gender shall include the feminine gender and words importing persons shall include firms and corporations and vice versa.

1.3   Currency

Unless otherwise specified, all dollar amounts in this Subscription Agreement, including the symbol “$”, are expressed in United States dollars.

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1.4   Subdivisions, Headings and Table of Contents

The division of this Subscription Agreement into Articles, Sections, Schedules and other subdivisions and the inclusion of headings are for convenience of reference only and shall not affect the construction or interpretation of this Subscription Agreement.  The headings in this Subscription Agreement are not intended to be full or precise descriptions of the text to which they refer.  Unless something in the subject matter or context is inconsistent therewith, references herein to an Article, Section, Subsection, paragraph, clause or Schedule are to the applicable article, section, subsection, paragraph, clause or schedule of this Subscription Agreement.

ARTICLE 2 - SCHEDULES

2.1   Description of Schedules

The following are the Schedules attached to and incorporated in this Subscription Agreement by reference and deemed to be a part hereof:

Schedule“A”-	Representation Letter
Schedule “B”-	Certificate – Additional Representations, Warranties

and Covenants for Non-Canadian Subscribers (other than

U.S. Persons)

Schedule “C”- Term Sheet

ARTICLE 3 - SUBSCRIPTION AND DESCRIPTION OF UNITS

3.1   Subscription for the Units

The Subscriber hereby confirms its irrevocable subscription for and offer to purchase the Units from the Corporation, on and subject to the terms and conditions set out in this Subscription Agreement, for the Subscription Price which is payable as described in Article 4 hereto.

3.2   Description of Units

Each Unit consists of one Share and one-half of one Warrant.  Subject to the anti-dilution provisions contained in the instrument under which the Warrants will be governed, each Warrant shall entitle the holder thereof to acquire upon payment of the Exercise Price one Warrant Share for a period of 18 months following the Closing Date.

3.3   Acceptance and Rejection of Subscription by the Corporation

The Subscriber acknowledges and agrees that the Corporation reserves the right, in its absolute discretion, to reject this subscription for Units, in whole or in part, at any time prior to the Closing Time.  If this subscription is rejected in whole, any cheques or other forms of payment delivered to the Agent representing the Subscription Price will be promptly returned to the Subscriber without interest or deduction.  If this subscription is accepted only in part, a cheque representing any refund of the Subscription Price for that portion of the subscription for the Units which is not accepted, will be promptly delivered to the Subscriber without interest or deduction.

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ARTICLE 4 - - CLOSING

4.1   Closing

Issuance, sale and delivery of the Units and payment of the Subscription Price will be completed (the “Closing”) at the offices of Stikeman Keeley Spiegel Pasternack LLP, 220 Bay Street, Suite 500, Toronto, Ontario, Canada at 10:00 a.m. (Toronto time) (the “Closing Time”) on February Ÿ, 2008 or such other place or date or time as the Corporation and the Agent may agree (the “Closing Date”).

4.2   Conditions of Closing

The Subscriber acknowledges and agrees (on its own behalf and, if applicable, on behalf of the Disclosed Principal) that as the sale of the Units will not be qualified by a prospectus, such sale and issuance is subject to the condition that the Subscriber (or, if applicable, the Disclosed Principal for whom it is contracting hereunder) sign and return to the Corporation and/or the Agent all relevant documentation required by the Securities Laws.  The Subscriber acknowledges and agrees that the Corporation and/or the Agent may be required to provide the Securities Regulators with a list setting forth the identities of the Disclosed Principal, if any.  Notwithstanding that the Subscriber may be purchasing Units as agent on behalf of an undisclosed principal, the Subscriber agrees to provide, on request, particulars as to the identity of the Disclosed Principal or any undisclosed principal as may be required by the Corporation in order to comply with the foregoing.

The Subscriber acknowledges and agrees (on its own behalf and, if applicable, on behalf of the Disclosed Principal) that the obligations of the Corporation hereunder are conditional on the accuracy and truth of the representations and warranties of the Subscriber contained in this Subscription Agreement as of the date of this Subscription Agreement, and as of the Closing Time as if made at and as of the Closing Time, and the fulfillment of the following additional conditions as soon as possible and in any event not later than the Closing Time:

(a)    the Corporation accepts the Subscriber's subscription in whole or in part;

(b)    unless other arrangements acceptable to the Corporation and the Agent have been made, payment by the Subscriber of the Subscription Price by certified cheque or bank draft in United States dollars payable to “D&D Securities Company”;

(c)    the Subscriber having properly completed, signed and delivered this Subscription Agreement to:

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    D&D Securities Company

    150 York Street, Suite 1714

    Toronto, Ontario

    M5H 3S5

    Attention: Wendy Rose

    Fax: (416) 363.3316

(d)    the Subscriber having properly completed, signed and delivered one of the certificates as set forth in Schedule “A” or Schedule “B” hereto, as applicable;

(e)    the Subscriber having properly completed, signed and delivered to the Corporation such other documents as may be required pursuant to terms of this Subscription Agreement; and

(f)    the Corporation obtaining all orders, permits, approvals, waivers, consents, licenses or similar authorizations of the Securities Regulators necessary to complete the offer, sale and issuance of the Securities; and

(g)    the conditions of closing contained in the Agency Agreement being satisfied or waived by the relevant party.

 4.3   Authorization of the Agent

A)The Subscriber irrevocably authorizes the Agent in its discretion, to act as the Subscriber’s representative at the Closing, and hereby appoints the Agent, with full power of substitution, as its true and lawful attorney with full power and authority in the Subscriber’s place and stead:

(a)    to receive certificates representing the Units, to execute in the Subscriber’s name and on its behalf all closing receipts and required documents, to complete and correct any errors or omissions in any form or document provided by the Subscriber in connection with the subscription for the Units and to exercise any rights of termination contained in the Agency Agreement;

(b)    to extend such time periods and to waive, in whole or in part, any representations, warranties, covenants or conditions for the Subscriber’s benefit contained in this Subscription Agreement, the Agency Agreement or any ancillary or related document in its absolute discretion, and as deemed appropriate;

(c)    to terminate this Subscription Agreement if any condition precedent is not satisfied, in such manner and on such terms and conditions as the Agent in its sole discretion may determine; and

(d)    without limiting the generality of the foregoing, to negotiate, settle, execute, deliver and amend the Agency Agreement.

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ARTICLE 5 - REPRESENTATIONS, WARRANTIES AND COVENANTS BY THE CORPORATION

5.1  Acknowledgements, Representations, Warranties and Covenants of the Corporation

The Corporation hereby represents and warrants to the Subscriber (and acknowledges that the Subscriber is relying thereon) that:

(a)    the Corporation has been duly incorporated and is validly subsisting and in good standing under the laws of the State of Delawareand has all requisite corporate power and capacity to enter into and carry out its obligations under this Subscription Agreement;

(b)    on the Closing Date, the Corporation will have taken all corporate steps and proceedings necessary to approve the transactions contemplated hereby, including the execution and delivery of this Subscription Agreement;

(c)    no order ceasing or suspending trading in the securities of the Corporation nor prohibiting the sale of such securities has been issued to the Corporation or its directors, officers or promoters and, to the best of the knowledge of the Corporation, no investigations or proceedings for such purposes are pending or threatened;

(d)    at the Closing Time, the Shares will be duly and validly authorized, allotted and be issued as fully paid and non-assessable Common Shares and upon the exercise of the Warrants, the Warrant Shares will be duly and validly authorized, allotted and be issued as fully paid and non-assessable Common Shares;

(e)    the Corporation has complied, or will comply, with all applicable corporate and securities laws and regulations in connection with the offer, sale and issuance of the Units;

(f)    upon acceptance by the Corporation this Subscription Agreement will constitute a binding obligation of the Corporation enforceable in accordance with its terms;

ARTICLE 6 - ACKNOWLEDGEMENTS, REPRESENTATIONS, WARRANTIES AND COVENANTS OF THE SUBSCRIBER

6.1   Acknowledgements, Representations, Warranties and Covenants of the Subscriber

The Subscriber, on its own behalf and, if applicable, on behalf of the Disclosed Principal, hereby represents and warrants to, and covenants with, the Corporation as follows and acknowledges that the Corporation and the Agent are relying on such representations and warranties in connection with the transactions contemplated herein:

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(a)    The Subscriber and, if applicable, the Disclosed Principal,  were offered the Units in and, are resident in the jurisdiction set out on the face page of this Subscription Agreement as the "Subscriber's Residential Address" and the "Disclosed Principal's Residential Address" (as the case may be) or are otherwise subject to the Securities Laws.  Such addresses were not created and are not used solely for the purpose of acquiring the Units and the Subscriber and, if applicable, the Disclosed Principal were solicited to purchase the Units solely in such jurisdiction.

(b)    The Subscriber and, if applicable, the Disclosed Principal have knowledge in financial and business affairs, are capable of evaluating the merits and risks of an investment in the Units and are able to bear the economic risk of such investment even if the entire investment is lost.

(c)    The Subscriber, on its own behalf and, if applicable, on behalf of the Disclosed Principal, makes the representations, warranties and covenants set out in Schedule “A” or Schedule “B” to this Subscription Agreement, as applicable, to the Corporation and the Subscriber and, if applicable, the Disclosed Principal may avail itself of one or more of the categories of prospectus exempt purchasers listed in Schedule “A” or Schedule “B”, as applicable.

(d)    The Subscriber has properly completed, executed and delivered within applicable time periods to the Corporation the applicable certificate (dated as of the date hereof) set forth in Schedule “A” or Schedule “B” to this Subscription Agreement and the information contained therein is true and correct.

(e)    The representations, warranties and covenants contained in Schedule “A” or Schedule “B”, as applicable, to this Subscription Agreement will be true and correct both as of the date of execution of this Subscription Agreement and as of the Closing Time.

(f)    The Subscriber and, if applicable, the Disclosed Principal are neither U.S. Persons nor subscribing for the Units for the account of a U.S. Person or for resale in the United States and the Subscriber confirms that the Units have not been offered to the Subscriber or the Disclosed Principal (as the case may be) in the United States and that this Subscription Agreement has not been signed in the United States.

(g)    Neither the Subscriber nor any Disclosed Principal will offer, sell or otherwise dispose of the Warrants in the United States or to a U.S. Person or for the account or benefit of a person in the United States or a U.S. Person.

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(h)    If the Subscriber or, if applicable, the Disclosed Principal is not a person resident in Canada, the subscription for the Units by the Subscriber, or if applicable, the Disclosed Principal does not contravene any of the applicable securities legislation in the jurisdiction in which the Subscriber or such other person resides.

(i)    The execution and delivery of this Subscription Agreement, the performance and compliance with the terms hereof, the subscription for the Units and the completion of the transactions described herein by the Subscriber or any beneficial purchaser for whom it is acting will not result in any material breach of, or be in conflict with or constitute a material default under, or create a state of facts which, after notice or lapse of time, or both, would constitute a material default under any term or provision of the constating documents, by-laws or resolutions of the Subscriber or any beneficial purchaser for whom it is acting, the Securities Laws or any other laws applicable to the Subscriber or any beneficial purchaser for whom it is acting, if applicable, or any other contract, instrument, undertaking, covenant or agreement to which the Subscriber or any beneficial purchaser for whom it is acting is a party, or any judgment, decree, order, statute, rule or regulation applicable to the Subscriber or any beneficial purchasers for whom it is acting.

(j)    Unless the Subscriber is purchasing under Section 6.1(k) hereof, it is purchasing the Units as principal for its own account, not for the benefit of any other person, for investment only and not with a view to the resale or distribution of all or any of the Common Shares or Warrants, it is resident in or otherwise subject to applicable securities laws of the jurisdiction set out as the “Subscriber’s Residential Address” on the face page of this Subscription Agreement and it fully complies with one of the criteria set forth below:

(i)    it is an “accredited investor”, as such term is defined in National Instrument 45-106 - “Prospectus and Registration Exemptions” (“NI 45-106”), it was not created or used solely to purchase or hold securities as an “accredited investor” as described in paragraph (m) of the definition of “accredited investor” in NI 45-106 and it has concurrently executed and delivered a Representation Letter in the form attached as Schedule “A” to this Subscription Agreement and has initialled in Appendix “I” thereto indicating that the Subscriber satisfies (and will satisfy at the Closing Time) one of the categories of “accredited investor” set forth in such definition;

(ii)   the aggregate acquisition cost of the Units to the Subscriber is not less than CDN$150,000 and it was not created or used solely to purchase or hold securities in reliance on the prospectus exemption or the dealer registration exemption set out in Section 2.10 of NI 45-106; or

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(iii)  it is a resident of, or otherwise subject to, the securities legislation of a jurisdiction other than Canada or the United States and it has concurrently executed and delivered the certificate attached as Schedule “B” to this Subscription Agreement.

(k)    If the Subscriber is purchasing the Units and is acting as agent for the Disclosed Principal, such Disclosed Principal is purchasing as principal for its own account, not for the benefit of any other person, for investment only and not with a view to the resale or distribution of all or any of the Shares or Warrants and such Disclosed Principal complies with subsection (i) or subsection (ii) of Section 6.1(j) hereof, the Subscriber acknowledges the Corporation is required by law to disclose to certain regulatory authorities the identity of Disclosed Principal for whom it may be acting, the Subscriber is resident in or otherwise subject to applicable securities laws of the jurisdiction set out as the “Subscriber’s Residential Address” on the face page of this Subscription Agreement and the Disclosed Principal is resident in or otherwise subject to applicable securities laws of the jurisdiction set out as the “Disclosed Principal's Residential Address” on the face page of this Subscription Agreement.

(l)    In the case of a subscription for the Units by the Subscriber acting as trustee or agent (including, for greater certainty, a portfolio manager or comparable adviser) for a principal, the Subscriber is duly authorized to execute and deliver this Subscription Agreement and all other necessary documentation in connection with such subscription on behalf of each such beneficial purchaser, each of whom is subscribing as principal for its own account, not for the benefit of any other person and not with a view to the resale or distribution of the Common Shares and Warrants, and this Subscription Agreement has been duly authorized, executed and delivered by or on behalf of and constitutes a legal, valid and binding agreement of, such principal, and the Subscriber acknowledges that the Corporation and/or the Agent may be required by law to disclose the identity of any undisclosed beneficial purchaser for whom the Subscriber is acting.

(m)    In the case of a subscription for the Units by the Subscriber acting as principal, this Subscription Agreement and all other documentation in connection with such subscription has been duly authorized, executed and delivered by, and constitutes a legal, valid and binding agreement of, the Subscriber.  This Subscription Agreement is enforceable in accordance with its terms against the Subscriber and any beneficial purchaser, including the Disclosed Principal, on whose behalf the Subscriber is acting.

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(n)    If the Subscriber is:

(i)      a corporation, the Subscriber is duly incorporated and is validly subsisting under the laws of its jurisdiction of incorporation and has all requisite legal and corporate power and authority to execute and deliver this Subscription Agreement, to subscribe for the Units as contemplated herein and to carry out and perform its obligations under the terms of this Subscription Agreement;

(ii)     a partnership, syndicate or other form of unincorporated organization, the Subscriber has the necessary legal capacity and authority to execute and deliver this Subscription Agreement and to observe and perform its covenants and obligations hereunder and has obtained all necessary approvals in respect thereof;

(iii)    an individual, the Subscriber is of the full age of majority in the jurisdiction in which it is resident and has the legal capacity and competency to execute and deliver this Subscription Agreement and to observe and perform his or her covenants and obligations hereunder; and

(iv)    subscribing on its own behalf, this Subscription Agreement has been duly executed and delivered by the Subscriber and constitutes a legal, valid and binding agreement of the Subscriber enforceable against him or her in accordance with its terms.

(o)    Other than the Agent (and any group of investment dealers managed by the Agent for purposes of offering the Units for sale), there is no person acting or purporting to act in connection with the transactions contemplated herein who is entitled to any brokerage or finder’s fee.  If any person establishes a claim that any fee or other compensation is payable in connection with this subscription for the Units, the Subscriber covenants to indemnify and hold harmless the Corporation, the Agent and any such registrant with respect thereto and with respect to all costs reasonably incurred in the defence thereof.

(p)    The Subscriber and, if applicable, the Disclosed Principal are not purchasing Units with knowledge of material information concerning the Corporation which has not been generally disclosed.

(q)    If required by the Securities Laws or the Corporation, the Subscriber will execute, deliver and file or assist the Corporation in filing such reports, undertakings and other documents with respect to the issue of the Securities as may be required by any securities commission, stock exchange or other regulatory authority (including, if applicable, the Representation Letter in the form attached hereto as Schedule “A”).

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(r)    The Subscriber and, if applicable, the Disclosed Principal have been advised to consult their own legal advisors with respect to the execution, delivery and performance by it of this Subscription Agreement and the transactions contemplated by this Subscription Agreement, including but not limited to, trading in the Securities and with respect to the resale restrictions imposed by the Securities Laws and other applicable securities laws, and acknowledges that no representation has been made respecting the applicable hold periods imposed by the Securities Laws or other resale restrictions applicable to such securities which restrict the ability of the Subscriber (or, if applicable, the Disclosed Principal) to resell such securities, that the Subscriber (or, if applicable, the Disclosed Principal) is solely responsible to find out what these restrictions are and the Subscriber is solely responsible (and neither the Corporation nor the Agent are in any way responsible) for compliance with applicable resale restrictions and the Subscriber (and, if applicable, the Disclosed Principal) is aware that it may not be able to resell such securities except in accordance with limited exemptions under the Securities Laws and other applicable securities laws.

(s)    The Subscriber has not received or been provided with a prospectus, offering memorandum (as such term is defined in the Securities Laws), or any similar document in connection with the Offering and the Subscriber’s decision to subscribe for the Units was not based upon, and the Subscriber has not relied upon, any verbal or written representations as to facts made by or on behalf of the Corporation, the Agent or any other employees or agent.  The Subscriber’s decision to subscribe for the Units was based solely upon information about the Corporation which is publicly available (any such information having been obtained by the Subscriber without independent investigation or verification by the Agent) and agrees that the Agent and the Agent's counsel assume no responsibility or liability of any nature whatsoever for the accuracy, adequacy or completeness of the publicly available information or as to whether all information concerning the Corporation required to be disclosed by the Corporation has been generally disclosed and acknowledges that the Agent's counsel and the Corporation’s counsel are acting as counsel to the Agent and the Corporation, respectively, and not as counsel to the Subscriber.

(t)    No person has made any written or oral representations:

(i)      that any person will resell or repurchase any of the Securities;

(ii)     that any person will refund the Subscription Price; or

(iii)    as to the future price or value of any of the Securities.

(u)    The subscription for the Units has not been made through or as a result of, and the distribution of the Units is not being accompanied by any advertisement, including without limitation in printed public media, radio, television or telecommunications, including electronic display, or as part of a general solicitation.

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(v)    The funds representing the Subscription Price which will be advanced by the Subscriber hereunder will not represent proceeds of crime for the purposes of the Proceeds of Crime (Money Laundering) and Terrorist Financing Act (Canada) and the Subscriber acknowledges that the Corporation or the Agent may in the future be required by law to disclose the Subscriber’s name and other information relating to this Subscription Agreement and the Subscriber’s subscription hereunder, on a confidential basis, pursuant to the Proceeds of Crime (Money Laundering) and Terrorist Financing Act (Canada) and to the best of the Subscriber’s knowledge: (i) none of the subscription funds to be provided by the Subscriber (A) have been or will be derived from or related to any activity that is deemed criminal under the law of Canada, the United States, or any other jurisdiction, or (B) are being tendered on behalf of a person or entity who has not been identified to the Subscriber; and (ii) it shall promptly notify the Corporation and the Agent if the Subscriber discovers that any of such representations ceases to be true, and to provide the Corporation and the Agent with appropriate information in connection therewith.

6.2   Acknowledgments of the Subscriber

The Subscriber (on its own behalf and, if applicable, on behalf of the Disclosed Principal) acknowledges and agrees as follows:

(a)    The Subscriber acknowledges that the aggregate gross proceeds of the Offering will be up to US$5,000,000, that the Corporation is effecting a concurrent private placement of up to US$6,500,000 aggregate principal amount of secured convertible debentures, convertible, subject to adjustment, at $1 per share, plus 3,076,190 common share purchase warrants convertible at prices from $1.25 to $1.75 for a period of 5 years from Closing, and that closing of the Offering is not conditional on the completion of such concurrent placement.

(b)    No prospectus or registration statement has been filed with any Securities Regulators or the SEC in connection with the Offering.

(c)    No securities commission, agency, governmental authority, regulatory body, stock exchange or other regulatory body has reviewed or passed on the merits of an investment in or endorsement of the Securities.

(d)    The Securities will be subject to statutory resale restrictions under the Securities Laws and under other applicable securities laws, and the Subscriber covenants that it will not resell any Securities except in compliance with such laws and the Subscriber acknowledges that it is solely responsible (and neither the Corporation nor the Agent are in any way responsible) for such compliance.  There is currently no market for the Securities in Canada, and accordingly, the Securities offered hereunder may be subject to indefinite resale restrictions in Canada.  The Corporation may make a notation on its records or give instructions to any transfer agent of the Common Shares or Warrants in order to implement such resale restrictions;

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(e)    The Corporation may complete additional financings in the future in order to develop the business of the Corporation and fund its ongoing development, and such future financings may have a dilutive effect on current securityholders of the Corporation, including the Subscriber but there is no assurance that such financing will be available, on reasonable terms or at all, and if not available, the Corporation may be unable to fund its ongoing development;

(f)    (A) The Securities have not been registered under the U.S. Securities Act, are being sold in reliance upon an exemption from registration afforded by Regulation S promulgated under the U.S. Securities Act; and the Securities have not been registered with any state securities commission or authority; (B) pursuant to the requirements of Regulation S, the Securities may not be transferred, sold or otherwise exchanged unless in compliance with the provisions of Regulation S and/or pursuant to registration under the U.S. Securities Act, or pursuant to an available exemption thereunder; and (C) the Corporation is under no obligation to register the Securities under the U.S. Securities Act or any state securities law, or to take any action to make any exemption from any such registration provisions available;

(g)    The certificates (and any replacement certificates issued prior to the expiration of the applicable hold periods or ownership statements issued under a direct registry system or other electronic book entry system) representing the Shares and Warrants will bear, as of the Closing Date, legends substantially in the following form and with the necessary information inserted:

“UNLESS PERMITTED UNDER SECURITIES LEGISLATION, THE HOLDER OF THIS SECURITY MUST NOT TRADE THE SECURITY BEFORE THE DATE THAT IS 4 MONTHS AND A DAY AFTER THE LATER OF (i) [INSERT THE DISTRIBUTION DATE], AND (ii) THE DATE THE ISSUER BECAME A REPORTING ISSUER IN ANY PROVINCE OR TERRITORY.”

(h)    In the event that holders of Warrants convert or exercise such securities prior to the expiry of the hold periods applicable thereto in Canada, the Warrant Shares will bear legends substantially in the following form and with the necessary information inserted:

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“UNLESS PERMITTED UNDER SECURITIES LEGISLATION, THE HOLDER OF THIS SECURITY MUST NOT TRADE THE SECURITY BEFORE THE DATE THAT IS 4 MONTHS AND A DAY AFTER (i) [INSERT THE DISTRIBUTION DATE], AND (ii) THE DATE THE ISSUER BECAME A REPORTING ISSUER IN ANY PROVINCE OR TERRITORY.”

(i)    The certificates representing the Shares, Warrants and Warrant Shares originally issued to a person, other than a U.S. Person, a person in the United States or a person for the account or benefit of a U.S. Person or a person in the United States, as well as all certificates issued in exchange for or in substitution of the foregoing securities, shall bear the following additional legend:

“THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE BEEN OFFERED AND SOLD IN AN “OFFSHORE TRANSACTION” IN RELIANCE UPON REGULATION S AS PROMULGATED BY THE SECURITIES AND EXCHANGE COMMISSION. ACCORDINGLY, THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933 (THE “SECURITIES ACT”) AND MAY NOT BE TRANSFERRED OTHER THAN IN ACCORDANCE WITH REGULATION S, PURSUANT TO REGISTRATION UNDER THE SECURITIES ACT, OR PURSUANT TO AN AVAILABLE EXEMPTION FROM REGISTRATION UNDER THE SECURITIES ACT, THE AVAILABILITY OF WHICH IS TO BE ESTABLISHED TO THE SATISFACTION OF THE COMPANY. THE SECURITIES REPRESENTED BY THIS CERTIFICATE CANNOT BE THE SUBJECT OF HEDGING TRANSACTIONS UNLESS SUCH TRANSACTIONS ARE CONDUCTED IN COMPLIANCE WITH THE SECURITIES ACT.”

(j)    The Subscriber (on its own behalf and, if applicable, on behalf of the Disclosed Principal) shall execute, deliver, file and otherwise assist the Corporation and the Agent with filing all documentation required by the Securities Laws to permit the subscription for the Units and the issuance of the Shares, Warrants or Warrant Shares, as may be required.

(k)    The Corporation and the Agent are relying on the representations, warranties and covenants contained herein and in one of Schedule “A” or Schedule “B” attached hereto to determine the Subscriber’s eligibility to subscribe for the Units under the Securities Laws and the securities laws of the United States and the Subscriber agrees to indemnify the Corporation, the Agent and each of their respective directors and officers against all losses, claims, costs, expenses, damages or liabilities which any of them may suffer or incur as a result of or arising from reliance thereon. The Subscriber undertakes to immediately notify the Corporation and the Agent of any change in any statement or other information relating to the Subscriber set forth in such applicable Schedule which takes place prior to the Closing Time.

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(l)    The Agent and/or its directors, officers, employees, agents and representatives assume no responsibility or liability of any nature whatsoever for the accuracy or adequacy of any publicly available information concerning the Corporation that is required to be disclosed or filed by the Corporation under the Securities Laws or any other applicable laws has been so disclosed or filed.

(m)    The Corporation is relying on an exemption from the requirement to provide the Subscriber with a prospectus under the Securities Laws and the securities laws of the United States and, as a consequence of acquiring the Units pursuant to such exemption, certain information, protections, rights and remedies provided by such securities laws will not be available to the Subscriber.

(n)    The Subscriber and, if applicable, the Disclosed Principal are responsible for obtaining such legal and tax advice as they consider appropriate in connection with the execution, delivery and performance of this Subscription Agreement and the transactions contemplated under this Subscription Agreement.  The Subscriber and, if applicable, the Disclosed Principal, are not relying on the Corporation, the Agent or their respective affiliates or counsel in this regard.

(o)    There is no government or other insurance covering the Securities.

(p)    There are risks associated with the purchase of the Securities and the Subscriber and any beneficial purchaser for whom it is acting, including any Disclosed Principal, may lose his, her or its entire investment.

6.3   Reliance on Representations, Warranties, Covenants and Acknowledgements

The Subscriber acknowledges and agrees (on its own behalf and, if applicable, on behalf of the Disclosed Principal) that the representations, warranties, covenants and acknowledgements made by the Subscriber in this Subscription Agreement are made with the intention that they may be relied upon by the Corporation and the Agent in determining the Subscriber’s eligibility (and, if applicable, the eligibility of the Disclosed Principal) to purchase the Units under the Securities Laws or other applicable securities laws. The Subscriber further agrees that by accepting the Units, the Subscriber shall be representing and warranting that such representations, warranties, acknowledgements and covenants are true as at the Closing Time with the same force and effect as if they had been made by the Subscriber at the Closing Time and that they shall survive the purchase by the Subscriber of the Units and shall continue in full force and effect notwithstanding any subsequent disposition by the Subscriber of any of the Common Shares, Warrants or Warrant Shares.

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ARTICLE 7 - SURVIVAL OF REPRESENTATIONS, WARRANTIES AND COVENANTS

7.1   Survival of Representations, Warranties and Covenants of the Corporation

The representations, warranties, acknowledgements and covenants of the Corporation contained in this Subscription Agreement shall survive the Closing and, notwithstanding such Closing or any investigation made by or on behalf of the Subscriber with respect thereto, shall continue in full force and effect for the benefit of the Subscriber and the Agent.

7.2   Survival of Representations, Warranties and Covenants of the Subscriber

The representations, warranties, acknowledgements and covenants of the Subscriber contained in this Subscription Agreement shall survive the Closing and, notwithstanding such Closing or any investigation made by or on behalf of the Corporation with respect thereto, shall continue in full force and effect for the benefit of the Corporation and the Agent.

ARTICLE 8 - COMMISSION

8.1    The Subscriber understands that in connection with the issue and sale of the Units pursuant to the Offering: (a) the Agent will receive from the Corporation on Closing, a cash commission equal to 7% of the gross proceeds of the Offering and (b) the Corporation will grant to the Agent warrants (the “Broker’s Warrants”) equal in number to 10% of the number of Units sold pursuant to the Offering.  Subject to anti-dilution provisions contained in the instrument under which the Broker’s Warrants will be governed, each Broker Warrant will entitle the Agent to purchase one Unit at an exercise price of US$0.65 or such other price as may be prescribed by Toronto Stock Exchange for a period of eighteen (18) months following the Closing Date.  No other fee or commission is payable by the Corporation in connection with the completion of the Offering.

ARTICLE 9 - COLLECTION OF PERSONAL INFORMATION

9.1   Collection of Personal Information

The Subscriber acknowledges that this Subscription Agreement and Schedule “A” hereto require the Subscriber to provide certain personal information to the Corporation.  Such information is being collected by the Corporation for the purposes of completing the Offering, which includes, without limitation, determining the Subscriber’s eligibility (or, if applicable, the eligibility of the Disclosed Principal) to purchase the Units under applicable securities legislation, preparing and registering certificates representing the Units to be issued hereunder and completing filings required by any stock exchange or securities regulatory authority.  The Subscriber’s personal information (and, if applicable, the Disclosed Principal’s personal information) may be disclosed by the Corporation to: (a) stock exchanges or securities regulatory authorities, (b) the Corporation’s registrar and transfer agent, (c) any government agency, board or other entity; and (d) any of the other parties involved in the Offering, including the Corporation, the Agent and their respective legal counsel, and may be included in record books in connection with the Offering.  

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By executing this Subscription Agreement, the Subscriber (and, if applicable, the Disclosed Principal) is deemed to be consenting to the foregoing collection, use and disclosure of the Subscriber’s personal information (and, if applicable, the Disclosed Principal’s personal information).  The Subscriber (and, if applicable, the Disclosed Principal) also consents to the filing of copies or originals of any of the documents described in Section 6.1(r) of this Subscription Agreement as may be required to be filed with any stock exchange or securities regulatory authority in connection with the transactions contemplated hereby and consents to the disclosure of such information to the public through the filing of a report of trade with applicable Securities Regulators.  The Subscriber (and, if applicable, the Disclosed Principal) further acknowledges that it has been notified by the Corporation of and authorizes (a) the delivery to the Ontario Securities Commission (the “OSC”) of the full name, residential address and telephone number of the Subscriber (and, if applicable, the Disclosed Principal), the number and type of securities purchased, the total purchase price, the exemption relied upon and the date of distribution; (b) that this information is being collected indirectly by the OSC under the authority granted to it in securities legislation; (c) that this information is being collected for the purposes of the administration and enforcement of the securities legislation of Ontario; and (d) that the Administrative Assistant to the Director of Corporate Finance can be contacted at Ontario Securities Commission, Suite 1903, Box 55, 20 Queen Street West, Toronto, Ontario M5H 3S8, or at (416) 593-8086, regarding any questions about the OSC’s indirect collection of this information.

ARTICLE 10 - MISCELLANEOUS

10.1   Further Assurances

Each of the parties hereto upon the request of each of the other parties hereto, whether before or after the Closing Time, shall do, execute, acknowledge and deliver or cause to be done, executed, acknowledged and delivered all such further acts, deeds, documents, assignments, transfers, conveyances, powers of attorney and assurances as may reasonably be necessary or desirable to complete the transactions contemplated herein.

10.2   Notices

(a)    Any notice, direction or other instrument required or permitted to be given to any party hereto shall be in writing and shall be sufficiently given if delivered personally, or transmitted by facsimile tested prior to transmission to such party, as follows:

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(i)    in the case of the Corporation, to:

Firstgold Corp.

3108 Ponte Morino Drive, Suite 210

Cameron Park

CA  95682

Attention:  Mr. Steve Akerfeldt

Fax:  (416) 656-4519

with a copy to:

Stikeman Keeley Spiegel Pasternack LLP

220 Bay Street

Suite 500

Toronto, ON M5J 2W4

Attention:  Robert Spiegel

Fax:  (416) 365-1813

(ii)   in the case of the Subscriber, at the address specified on the face page hereof;

(iii)  in the case of the Agent, to:

D&D Securities Company

150 York Street, Suite 1714

Toronto, Ontario

M5H 3S5

Attention:  Bob Rose

Fax:  (416) 363.3316

(b)    Any such notice, direction or other instrument, if delivered personally, shall be deemed to have been given and received on the day on which it was delivered, provided that if such day is not a Business Day then the notice, direction or other instrument shall be deemed to have been given and received on the first Business Day next following such day and if transmitted by fax, shall be deemed to have been given and received on the day of its transmission, provided that if such day is not a Business Day or if it is transmitted or received after the end of normal business hours then the notice, direction or other instrument shall be deemed to have been given and received on the first Business Day next following the day of such transmission.

(c)    Any party hereto may change its address for service from time to time by notice given to each of the other parties hereto in accordance with the foregoing provisions.

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10.3   Time of the Essence

Time shall be of the essence of this Subscription Agreement and every part hereof.

10.4   Costs and Expenses

All costs and expenses (including, without limitation, the fees and disbursements of legal counsel) incurred in connection with this Subscription Agreement and the transactions herein contemplated shall be paid and borne by the party incurring such costs and expenses.

10.5   Applicable Law

This Subscription Agreement shall be construed and enforced in accordance with, and the rights of the parties shall be governed by, the laws of the Province of Ontario and the federal laws of Canada applicable therein. Any and all disputes arising under this Subscription Agreement, whether as to interpretation, performance or otherwise, shall be subject to the non-exclusive jurisdiction of the courts of the Province of Ontario and each of the parties hereto hereby irrevocably attorns to the jurisdiction of the courts of the Province of Ontario and waives objection to the venue of any proceeding in such court or that such court provides an inconvenient forum.

10.6   Entire Agreement

This Subscription Agreement, including the Schedules hereto, constitutes the entire agreement between the parties hereto with respect to the transactions contemplated herein and cancels and supersedes any prior understandings, agreements, negotiations and discussions between the parties. There are no representations, warranties, terms, conditions, undertakings or collateral agreements or understandings, express or implied, between the parties hereto other than those expressly set forth in this Subscription Agreement or in any such agreement, certificate, affidavit, statutory declaration or other document as set out in this Subscription Agreement. This Subscription Agreement may not be amended or modified in any respect except by written instrument executed by each of the parties hereto.

10.7   Counterparts

This Subscription Agreement may be executed in two or more counterparts, each of which shall be deemed to be an original and all of which together shall constitute one and the same Subscription Agreement. Counterparts may be delivered either in original or faxed form and the parties adopt any signature received by a receiving fax machine as original signatures of the parties.

10.8   Assignment

This Subscription Agreement may not be assigned by either party except with the prior written consent of the other parties hereto.

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10.9   Enurement

This Subscription Agreement shall enure to the benefit of and be binding upon the parties hereto and their respective heirs, executors, successors (including any successor by reason of the amalgamation or merger of any party), administrators and permitted assigns.

10.10   Beneficial Subscribers

Whether or not explicitly stated in this Subscription Agreement, any acknowledgement, representation, warranty, covenant or agreement made by the Subscriber in this Subscription Agreement, including the Schedules will be treated as if made by the Disclosed Principal, if any.

10.11   Language of Documents

It is the express wish of the parties to this Agreement that this Agreement and all related documents be drafted in English.  Les parties aux présentes conviennent et exigent que cette convention ainsi que tous les documents s'y rattachant soient rédigés en langue Anglais.

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SCHEDULE “A”

REPRESENTATION LETTER

TO:	Firstgold Corp. (the “Corporation”)
AND TO:	D&D Securities Company (the“Agent”)

In connection with the agreement to purchase Units by the undersigned Subscriber or, if applicable, the Disclosed Principal on whose behalf the undersigned is purchasing as agent, the Subscriber hereby represents, warrants, covenants and certifies to the Corporation and the Agent that:

1. The undersigned Subscriber is resident in the jurisdiction set out as the "Subscriber's Residential Address" on the face page of the Subscription Agreement and, if the undersigned Subscriber is acting as agent for a Disclosed Principal, the Disclosed Principal is resident in the jurisdiction set out at the "Disclosed Principal's Residential Address" on the face page of the Subscription Agreement.

2. The undersigned Subscriber or, if the Subscriber is acting as agent for a Disclosed Principal, the Disclosed Principal is purchasing the Units as principal for its own account (NOTE: For this purpose, a trust company or trust corporation described in paragraph (p) in Appendix “I” to this Representation Letter (other than a trust company or trust corporation registered under the laws of Prince Edward Island that is not registered or authorized under the Trust and Loan Companies Act (Canada) or under comparable legislation in another jurisdiction of Canada) and a person described in paragraph (q) in Appendix “I” to this Representation Letter is deemed to be purchasing as principal).

3.The undersigned Subscriber (or if the undersigned Subscriber is purchasing as agent for a Disclosed Principal, the Disclosed Principal) is and will be at the Closing Time an “accredited investor” within the meaning of NI 45-106 by virtue of satisfying the indicated criterion as set out in Appendix “I” to this Representation Letter.

4.The undersigned Subscriber (or if the undersigned Subscriber is purchasing as agent for a Disclosed Principal, the Disclosed Principal) was not created or used solely to purchase or hold securities as described in paragraph (m) of the definition of "accredited investor" in NI 45-106.

5.Upon execution of this Schedule “A” by the Subscriber, this Schedule “A” shall be incorporated into and form a part of the Subscription Agreement to which this Schedule is attached.

Dated: , 2008
	Print name of Subscriber, or person signing as agent for the Disclosed Principal
	/s/
	Signature
	Print name of Signatory (if different from Subscriber or agent, as applicable)
	Title

** PLEASE INITIAL THE APPLICABLE PROVISION IN APPENDIX “I” ON THE FOLLOWING PAGES **

A-1

APPENDIX “I”

TO SCHEDULE “A”

NOTE: THE INVESTOR MUST INITIAL BESIDE THE APPLICABLE PORTION OF THE DEFINITION BELOW.

Accredited Investor - (defined in NI 45-106) means:

(a)a Canadian financial institution, or a Schedule III bank; or

(b)the Business Development Bank of Canada incorporated under the Business Development Bank of Canada Act (Canada); or

(c)a subsidiary of any person referred to in paragraphs (a) or (b), if the person owns all of the voting securities of the subsidiary, except the voting securities required by law to be owned by directors of that subsidiary; or

(d)a person registered under the securities legislation of a jurisdiction of Canada as an adviser or dealer, other than a person registered solely as a limited market dealer under one or both of the Securities Act (Ontario) or the Securities Act (Newfoundland and Labrador); or

(e)an individual registered or formerly registered under the securities legislation of a jurisdiction of Canada as a representative of a person referred to in paragraph (d); or

(f)the Government of Canada or a jurisdiction of Canada, or any crown corporation, agency or wholly owned entity of the Government of Canada or a jurisdiction of Canada; or

(g)a municipality, public board or commission in Canada and a metropolitan community, school board, the Comité de gestion de la taxe scolaire de l’ile de Montréal or an intermuncipal management board in Québec; or

(h)any national, federal, state, provincial, territorial or municipal government of or in any foreign jurisdiction, or any agency of that government; or

(i)a pension fund that is regulated by either the Office of the Superintendent of Financial Institutions (Canada) or a pension commission or similar regulatory authority of a jurisdiction of Canada; or

(j)an individual who, either alone or with a spouse, beneficially owns, directly or indirectly, financial assets having an aggregate realizable value that before taxes, but net of any related liabilities, exceeds $1,000,000; or

**Note: if individual accredited investors wish to purchase through wholly-owned holding companies or similar entities, such purchasing entities must qualify under (t) below, which must be initialled.

(k)an individual whose net income before taxes exceeded $200,000 in each of the 2 most recent calendar years or whose net income before taxes combined with that of a spouse exceeded $300,000 in each of the 2 most recent calendar years and who, in either case, reasonably expects to exceed that net income level in the current calendar year; or

**Note: if individual accredited investors wish to purchase through wholly-owned holding companies or similar entities, such purchasing entities must qualify under (t) below, which must be initialled.

I-1

(l)an individual who, either alone or with a spouse, has net assets of at least $5,000,000; or

**Note: if individual accredited investors wish to purchase through wholly-owned holding companies or similar entities, such purchasing entities must qualify under (t) below, which must be initialled.

(m)a person, other than an individual or investment fund, that has net assets of at least $5,000,000 as shown on its most recently prepared financial statements; or

(n)an investment fund that distributes or has distributed its securities only to:

(i)  a person that is or was an accredited investor at the time of the distribution,

(ii) a person that acquires or acquired securities in the circumstances referred to in sections 2.10 [Minimum amount investment] of NI 45-106, and 2.19 [Additional investment in investment funds] of NI 45-106, or

(iii)a person described in paragraph (i) or (ii) that acquires or acquired securities under section 2.18 [Investment fund reinvestment] of NI 45-106; or

(o)an investment fund that distributes or has distributed securities under a prospectus in a jurisdiction of Canada for which the regulator or, in Quebec, the securities regulatory authority, has issued a receipt; or

(p)a trust company or trust corporation registered or authorized to carry on business under the Trust and Loan Companies Act (Canada) or under comparable legislation in a jurisdiction of Canada or a foreign jurisdiction, acting on behalf of a fully managed account managed by the trust company or trust corporation, as the case may be; or

(q)a person acting on behalf of a fully managed account managed by that person, if that person:

(i)  is registered or authorized to carry on business as an adviser or the equivalent under the securities legislation of a jurisdiction of Canada or a foreign jurisdiction, and

(ii) in Ontario, is purchasing a security that is not a security of an investment fund; or

(r)a registered charity under the Income Tax Act (Canada) that, in regard to the trade, has obtained advice from an eligibility adviser or an adviser registered under the securities legislation of the jurisdiction of the registered charity to give advice on the securities being traded; or

(s)an entity organized in a foreign jurisdiction that is analogous to any of the entities referred to in paragraphs (a) to (d) or paragraph (i) in form and function; or

(t)a person in respect of which all of the owners of interests, direct, indirect or beneficial, except the voting securities required by law to be owned by directors, are persons that are accredited investors; or

(u)an investment fund that is advised by a person registered as an adviser or a person that is exempt from registration as an adviser; or

(v)a person that is recognized or designated by the securities regulatory authority or, except in Ontario and Quebec, the regulator as:

(i)  an accredited investor, or

(ii) an exempt purchaser in Alberta or British Columbia after NI 45-106 came into force.

I-2

For the purposes hereof:

an issuer is an “affiliate” of another issuer if

(a)  one of them is the subsidiary of the other, or

(b)  each of them is controlled by the same person;

“bank” means a bank named in Schedule I or II of the Bank Act (Canada);

“Canadian financial institution” means

(a)  an association governed by the Cooperative Credit Associations Act (Canada) or a central cooperative credit society for which an order has been made under section 473(1) of that Act, or

(b)  a bank, loan corporation, trust company, trust corporation, insurance company, treasury branch, credit union, caisse populaire, financial services cooperative, or league that, in each case, is authorized by an enactment of Canada or a jurisdiction of Canada to carry on business in Canada or a jurisdiction in Canada;

“company” means any corporation, incorporated association, incorporated syndicate or other incorporated organization;

a person (first person) is considered to “control” another person (second person) if

(a)  the first person, directly or indirectly, beneficially owns or exercises control or direction over securities of the second person carrying votes which, if exercised, would entitle the first person to elect a majority of the directors of the second person, unless that first person holds the voting securities only to secure an obligation,

(b)  the second person is a partnership, other than a limited partnership, and first person holds more than 50% of the interests of the partnership, or

(c)  the second person is a limited partnership and the general partner of the limited partnership is the first person;

“director” means

(a)  a member of the board of directors of a company or an individual who performs similar functions for a company, and

I-3

(b)  with respect to a person that is not a company, an individual who performs functions similar to those of a director of a company;

“entity” means a company, syndicate, partnership, trust or unincorporated organization;

“financial assets” means

(a)  cash,

(b)  securities, or

(c)  a contract of insurance, a deposit or an evidence of a deposit that is not a security for the purposes of securities legislation;

“foreign jurisdiction” means a country other than Canada or a political subdivision of a country other than Canada;

“fully managed account” means an account of a client for which a person makes the investment decisions if that person has full discretion to trade in securities for the account without requiring the client’s express consent to a transaction;

“investment fund” means a mutual fund or non-redeemable investment fund, and, for greater certainty, in British Columbia includes an employee venture capital corporation that does not have a restricted constitution, and is registered under Part 2 of the Employee Investment Act (British Columbia), R.S.B.C. 1996 c. 112, and whose business objective is making multiple investments and a venture capital corporation registered under Part 1 of the Small Business Venture Capital Act (British Columbia), R.S.B.C. 1996 c.429 whose business objective is making multiple investments;

“jurisdiction” means a province or territory of Canada except when used in the term “foreign jurisdiction”;

“individual” means a natural person, but does not include

(a)  a partnership, unincorporated association, unincorporated syndicate, unincorporated organization or a trust, or

(b)  a natural person in his or her capacity as trustee, executor, administrator or other legal personal representative;

I-4

“mutual fund” includes an issuer whose primary purpose is to invest money provided by its security holders and whose securities entitle the holder to receive on demand, or within a specified period after demand, an amount computed by reference to the value of a proportionate interest in the whole or in a part of the net assets, including a separate fund or trust account, of the issuer of the securities;

“non-redeemable investment fund” means an issuer,

(a)  whose primary purpose is to invest money provided by its securityholders,

(b)  that does not invest,

(A)  for the purpose of exercising or seeking to exercise control of an issuer, other than an issuer that is a mutual fund or a non-redeemable investment fund, or

(B)  for the purpose of being actively involved in the management of any issuer in which it invests, other than an issuer that is a mutual fund or a non-redeemable investment fund, and

(c)  that is not a mutual fund;

“person” includes

(a)  an individual,

(b)  a corporation,

(c)  a partnership, trust, fund and an association, syndicate, organization or other organized group of persons, whether incorporated or not, and

(d)  an individual or other person in that person’s capacity as a trustee, executor, administrator or personal or other legal representative;

“regulator” means, for the local jurisdiction, the person referred to in Appendix D of National Instrument 14-101 “Definitions” (“NI 14-101”) opposite the name of the local jurisdiction;

“related liabilities” means:

(a)  liabilities incurred or assumed for the purpose of financing the acquisition or ownership of financial assets; or

(b)  liabilities that are secured by financial assets;

“Schedule III bank” means an authorized foreign bank named in Schedule III of the Bank Act (Canada);

“securities legislation” means, for the local jurisdiction, the instruments listed in Appendix B of NI 14-101 opposite the name of the local jurisdiction

I-5

“securities regulatory authority” means, for the local jurisdiction, the securities commission or similar regulatory authority listed in Appendix C of NI 14-101 opposite the name of the local jurisdiction;

“spouse” means an individual who,

(a)  is married to another individual and is not living separate and apart within the meaning of the Divorce Act (Canada), from the other individual,

(b)  is living with another individual in a marriage-like relationship, including a marriage-like relationship between individuals of the same gender, or

(c)  in Alberta, is an individual referred to in paragraph (a) or (b), or is an adult interdependent partner within the meaning of the Adult Interdependent Relationships Act (Alberta); and

“subsidiary” means an issuer that is controlled directly or indirectly by another issuer and includes a subsidiary of that subsidiary.

I-6

SCHEDULE “B”

CERTIFICATE

ADDITIONAL REPRESENTATIONS, WARRANTIES AND COVENANTS

FOR NON-CANADIAN SUBSCRIBERS

(OTHER THAN U.S. SUBSCRIBERS)

The Subscriber, on its own behalf and (if applicable) on behalf of others for whom it is acting hereunder, further represents, warrants and covenants to and with the Corporation and the Agent and their respective counsel (and acknowledges that the Corporation, the Agent and their respective counsel are relying thereon) that it is, and (if applicable) any beneficial purchaser for whom it is acting hereunder is, a resident of, or otherwise subject to, the securities legislation of a jurisdiction other than Canada or the United States, and:

(a)    the Subscriber is, and (if applicable) any other purchaser for whom it is acting hereunder, is:

(i)    a purchaser that is recognized by the securities regulatory authority in the jurisdiction in which it is, and (if applicable) any other purchaser for whom it is acting hereunder is resident or otherwise subject to the securities laws of such jurisdiction as an exempt purchaser and is purchasing the Units as principal for its, or (if applicable) each such other purchaser’s, own account, and not for the benefit of any other person, for investment only and not with a view to resale or distribution and no other person, corporation, firm or other organization has a beneficial interest in the said securities being purchased, or purchasing the securities as agent or trustee for the principal disclosed on the cover page of this Agreement and each disclosed principal for whom the Subscriber is acting is purchasing as principal for its own account, and not for the benefit of any other person, and is purchasing for investment only and not a view to resale or distribution; or

(ii)    a purchaser which is purchasing Units pursuant to an exemption from any prospectus or securities registration requirements (particulars of which are enclosed herewith) available to the Corporation, the Agent, the Subscriber and any such other purchaser under applicable securities laws of their jurisdiction of residence or to which the Subscriber and any such other purchaser are otherwise subject to, and the Subscriber and any such other purchaser shall deliver to the Corporation and the Agent such further particulars of the exemption and their qualification thereunder as the Corporation or the Agent may reasonably request;

(b)    the purchase of Units by the Subscriber, and (if applicable) each such other purchaser, does not contravene any of the applicable securities laws in such jurisdiction and does not trigger: (i) any obligation of the Corporation to prepare and file a prospectus, an offering memorandum or similar document, or (ii) any obligation of the Corporation to make any filings with or seek any approvals of any kind from any regulatory body in such jurisdiction or any other ongoing reporting requirements with respect to such purchase or otherwise; or (iii) any registration or other obligation on the part of the Corporation or the Agent;

B-1

(c)    all acts of solicitation, conduct or negotiations directly or indirectly in furtherance of the purchase of securities occurred outside of Canada and the United States;

(d)    no offer was made to the Subscriber in Canada or the United States and the buy order in respect of the subscription was not placed from within Canada or the United States;

(e)    the Subscriber is knowledgeable of, and has been independently advised as to, the securities laws of such jurisdiction as applicable to this Subscription Agreement; and

(f)    the Subscriber, and (if applicable) any other purchaser for whom it is acting hereunder will not sell or otherwise dispose of any the Shares, Warrants and Warrant Shares underlying the Units (the “Underlying Securities”), except in accordance with applicable Canadian securities laws, and if the Subscriber, or (if applicable) such beneficial purchaser sell or otherwise dispose of Underlying Securities to a person other than a resident of Canada, the Subscriber, and (if applicable) such beneficial purchaser, will obtain from such purchaser representations, warranties and covenants in the same form as provided in this Schedule “B” and shall comply with such other requirements as the Corporation may reasonably require.

Dated at _______________ this ____ day of ____________, 2008.

Name of Subscriber

 Signature of Subscriber

 Title of Subscriber

B-2

SCHEDULE “C”

TERM SHEET

FIRSTGOLD CORP.

UP TO US$5,000,000

PRIVATE PLACEMENT OF UNITS

Issuer:	Firstgold Corp. (the “Corporation”)
Issue:	Up to 7,692,307 Units (the “Units”), each Unit consisting of one common share in the capital of the Corporation (each, a “Share”) and one-half of one common share purchase warrant (each whole warrant, a “Warrant”).
Warrants:	Each whole Warrant will entitle the holder thereof to purchase one common share of the Corporation (each, a “Warrant Share”) at a price of US$0.80 per Warrant Share (the “Exercise Price”) for a period of 18 months from the closing date.
Amount:	Up to US$5,000,000.
Issue Price:	US$0.65 per Unit.
Form of Financing:	Best efforts agency private placement to institutional and “accredited” investors in Canada.
Agent:	D&D Securities Company
Use of Proceeds:	The net proceeds of the offering shall be used for exploration and development of the Corporation’s Relief Canyon project, as well as for general and administrative expenses.
Hold Period:	The Shares, Warrants and Warrant Shares will be subject to applicable hold periods in Canada and the United States. In Canada the hold period is four months from the date the Company becomes a reporting issuer and in the United States the hold period is six months from the date of Closing for the Shares so long as the Corporation maintains its public information requirements.
Fees:	Fees equal to 7.0% cash commission based on the gross proceeds raised in the Financing and 10.0% Broker’s Warrants (calculated on the basis of the number of Units issued upon closing of the Financing) with each broker warrant entitling the holder to purchase one Common Share and one-half of one Warrant at an exercise price equal to the offering price of the Units and expiring 18 months from closing of the Offering.
Closing:	On or about February 15, 2008 or as the Corporation and the Agent may otherwise agree.

C-1

EX-10.26

Exhibit 10.26

Certificate No. (Specimen)

CONVERTIBLE DEBENTURE

OF

FIRSTGOLD CORP.

ISSUE OF CONVERTIBLE DEBENTURE

OF US $1,100,000 PRINCIPAL SUM

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No.  Principal Amount US $1,100,000

UNLESS PERMITTED UNDER SECURITIES LEGISLATION, THE HOLDER OF THE SECURITIES SHALL NOT TRADE THE SECURITIES BEFORE THE DATE THAT IS 4 MONTHS AND A DAY AFTER THE LATER OF (i) [DATE OF CLOSING] AND (ii) THE DATE THE ISSUER BECAME A REPORTING ISSUER IN ANY PROVINCE OR TERRITORY.

CONVERTIBLE DEBENTURE

FIRSTGOLD CORP.

A Delaware Corporation

NOW THEREFORE it is hereby covenanted, agreed and declared as follows:

ARTICLE I

INTERPRETATION

1.1 Definitions.  In this Debenture, including the preamble, unless there is something in the subject matter or context inconsistent therewith, the following expressions shall have the following meanings namely:

(a) "Business Day" means any day other than a Saturday, Sunday, legal holiday or a day on which banking institutions are closed in Toronto, Ontario;

(b) "Common Shares" means the common shares of the Corporation as such shares are constituted on the date hereof;

(c) "Corporation" means Firstgold Corp., a Delaware corporation, and its successors and assigns;

(d)   "Conversion Notice" has the meaning ascribed to that term in Section 4.1 hereof;

(e) "Conversion Price"means the price per Debenture Share at which the Principal Sum outstanding under this Debenture shall from time to time be convertible into Common Shares pursuant to a Holder Conversion, being US$0.80 per Debenture Share, subject to adjustment;

(f) "Debenture Shares" means the Common Shares issuable upon the due conversion of Debentures;

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(g) "this Debenture", the "Debenture", "herein", "hereby", "hereof", "hereto", "hereunder" and similar expressions mean or refer to this convertible, subordinated, unsecured debenture and any debenture, deed or instrument supplemental or ancillary thereto and any schedules hereto or thereto and not to any particular article, section, subsection, clause, subclause or other portion hereof; the "Debentures" means this Debenture together with all others, being part of a series of like debentures except as to principal amount thereof;

(h) "Event of Default" means any of the events specified in Section 5.1 hereof;

(i) "Holder" or "Debentureholder" has the meaning ascribed hereto in Section 2.1 hereof;

(j) "Maturity Date" means January ●, 2010;

(k) "person" means an individual, corporation, partnership, unincorporated syndicate, unincorporated organization, trust, trustee, executor, administrator, or other legal representative, or any group or combination thereof;

(l)   "Principal Sum" means $US 1.1 million;

(m) "Redemption Amount" has the meaning ascribed to that term in Section 2.2 hereof;

(n) "Redemption Date" has the meaning ascribed to that term in Section 2.2 hereof.

1.2 Gender.  Whenever used in this Debenture, words importing the singular number only shall include the plural, and vice versa, and words importing the masculine gender shall include the feminine gender.

1.3 Numbering of Articles, etc.  Unless otherwise stated, a reference herein to a numbered or lettered article, section, subsection, clause, subclause or schedule refers to the article, section, subsection, clause, subclause or schedule bearing that number or letter in this Debenture.

1.4 Day not a Business Day.  In the event that any day on or before which any action is required to be taken hereunder is not a Business Day, then such action shall be required to be taken on or before the requisite time on the next succeeding day that is a Business Day.  If the payment of any amount is deferred for any period, then such period shall be included for purposes of the computation of any interest payable hereunder.

1.5 Computation of Time Period.  Except to the extent otherwise provided herein, in the computation of a period of time from a specified date to a later specified date, the word "from" means "from and including" and the words "to" and "until" each mean "to but excluding".

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ARTICLE II

PROMISE TO PAY

2.1 Indebtedness.  The Corporation, for value received, and in consideration of the premises hereby acknowledges itself indebted and promises and covenants to pay to _____________________, the registered holder hereof for the time being (the "Holder"):

(a)That amount of the Principal Sum outstanding on January ●, 2010 (the "Maturity Date") or sooner in accordance with Section 2.2 or upon the occurrence of an Event of Default or upon such other date as specified herein, subject to the reduction of such Principal Sum from time to time upon the exercise of the conversion rights set out in Article IV hereof, at the principal office of the Corporation in Cameron Park, California;

(b)interest on any monies owing by the Corporation to the Holder hereunder, all as specifically calculated hereunder; and

(c)all other monies which may be owing by the Corporation to the Holder pursuant to this Debenture.

2.2 Early Redemption.  After six (6) months from the Closing Date, this Debenture may be prepaid in whole prior to the Maturity Date at the Corporation’s option by providing the Holder with at least five (5) days prior written notice, for an amount equal to the sum of the following: (i) the Principal Sum then outstanding, and (ii) accrued and unpaid interest to the date fixed for early redemption (the "Redemption Date"); and (iii) a premium of 10% of the Principal Sum (the “Redemption Premium”) (the sum of (i), (ii) and (iii) (being the "Redemption Amount").

Notice of redemption shall be sent to the Holder not less than five (5) days prior to the Redemption Date and shall state:

(a)the Redemption Date; and

(b)the place where this Debenture is to be surrendered for payment of the Redemption Amount thereof.

Notice of redemption having been given as aforesaid, this Debenture shall, on the Redemption Date, become due and payable at the Principal Sum thereof and on and after such date such Debentures shall only bear interest if the Corporation shall default in the payment of the Redemption Amount on the Redemption Date.  Upon surrender of this Debenture for redemption in accordance with such notice, such Debenture shall be paid by the Corporation.  In addition, and for greater certainty, until this Debenture has been redeemed in accordance with this Section 2.2, the Holder retains the right to convert the Principal Sum to Debenture Shares in accordance with Article IV hereof.

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This Debenture may also be prepaid in part provided that any partial redemption is in the minimum amount of US$350,000; and further provided that the Corporation pay to the Holder the Redemption Premium on any amount so partially redeemed.

Notice of partial redemption shall be sent to the Holder not less than five (5) days prior to the date set for such partial redemption (the “Partial Redemption Date”) and shall state:

(a)the Partial Redemption Date;

(b)the amount of such partial redemption (the “Partial Redemption Amount”); and

(c)the place where this Debenture is to be surrendered for payment of the partial redemption amount thereof.

Notice of partial redemption having been given as aforesaid, this Debenture shall, on the Partial Redemption Date, become due and payable as to the Partial Redemption Amount thereof and on and after such date such Debenture shall only bear interest on the remaining Principal Sum.  Upon surrender of this Debenture for partial redemption in accordance with such notice, such Debenture shall be replaced with a new Debenture evidencing the remaining Principal Sum.

ARTICLE III

INTEREST

3.1 Calculation and Payment of Interest, etc.  The Corporation shall pay interest on the Principal Sum at the rate of 10.00% per annum, calculated and payable monthly in arrears (less any tax required by law to be deducted or withheld).  Contemporaneous with the delivery of this Debenture to the Holder duly executed by the Corporation (the “Closing Date”), the Corporation shall prepay an amount equal to the aggregate interest payable (without compounding interest) for a period of six (6) months.  Subsequent interest payments shall commence on the first business day of the eighth (8th) month following the calendar month in which the Closing Date occurs and shall continue on the first business day of each subsequent month while any Principal Amount remains outstanding hereunder

3.2 Overdue Interest.  All interest payable hereunder on becoming overdue shall be forthwith treated, as to the payment of interest thereon, as principal and thereafter shall bear interest calculated at the same rate and in the same manner as if it were principal.  Overdue interest shall be payable forthwith without demand by the Holder.  Any interest amount added to the Principal Sum by operation of this section may only be converted into Common Shares upon receipt of all required regulatory approvals which approvals may or may not be granted and if not granted, such additional interest amount will only be payable in cash.

3.3 No Merger In Judgement.  The covenant of the Corporation to pay interest at the rate provided herein shall not merge in any judgement in respect of any obligation of the Corporation hereunder and such judgement shall bear interest in the manner set out in this Article III and be payable on the same days when interest (whether hereunder or otherwise) is payable hereunder.

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ARTICLE IV 

CONVERSION OF DEBENTURE

4.1 Conversion.  The Holder may, at its election, upon surrender (either in person, by mail (postage prepaid) or other means of delivery) of this Debenture along with a completed notice of conversion (the "Conversion Notice") in the form attached hereto as Schedule "A" at the principal office of the Corporation in the Cameron Park, California at any time prior to the close of business on the earlier of (a) the Redemption Date; and (b) January ●, 2010, convert that portion of the Principal Sum so surrendered into Debenture Shares (without adjustment for interest accrued but unpaid hereon or for dividends on Common Shares issuable upon conversion) ("Holder Conversion").  Debentures may be converted on or prior to the Maturity Date or the Redemption Date, as the case may be, at a conversion price equal to the Conversion Price per Debenture Share; provided, however, that the Holder shall not be entitled to a Holder Conversion if, upon issuance of the Debenture Shares, the Holder would own, either directly or beneficially, in excess of 4.99% of the outstanding Common Shares of the Corporation.  The delivery of the Conversion Notice duly executed by the Holder and the surrender of the Debenture shall be deemed to constitute a contract between the Holder and the Corporation whereby (i) the Holder subscribes for the number of Debenture Shares which he shall be entitled to receive upon such Holder Conversion, (ii) the Holder releases the Corporation from all liability thereon or from all liability with respect to the portion of the Principal Sum thereof to be converted, as the case may be, and (iii) the Corporation agrees that the surrender of the Debenture for Holder Conversion constitutes full payment of the subscription price for the Debenture Shares issuable on such Holder Conversion and that the Debenture Shares will be issued as fully paid and non-assessable Common Shares in the capital of the Corporation.

As promptly as possible after receipt of the Conversion Notice and the Debenture but subject to Section 4.3 hereto, the Corporation shall issue or cause to be issued and deliver or cause to be delivered to the Holder a certificate or certificates in the name or names of the person or persons specified in the Conversion Notice for the number of Debenture Shares deliverable upon the Holder Conversion. Upon completion of the conversion transaction, the rights of the Holder to receive, in respect of the amount hereof so converted, the Principal Sum and interest thereon, shall cease and the Holder or the other person or persons in whose name or names any certificate or certificates for Common Shares shall be deliverable upon such Holder Conversion shall be deemed to have become on such date the holder or holders of record of such Common Shares represented thereby.  Interest will be payable on the Principal Sum up to the date of Holder Conversion.

In the event that only a portion of the Principal Sum is subject to Holder Conversion, the Holder will be entitled to receive a replacement Debenture representing the Principal Sum not subject to Holder Conversion on the same terms and provisions contained herein.  In this event, interest shall continue to be payable on the remainder of the Principal Sum.

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4.2 Adjustment.

(a) If and whenever the Corporation shall (i) subdivide or redivide the outstanding Common Shares into a greater number of Common Shares; (ii) reduce, combine or consolidate the outstanding Common Shares into a smaller number of Common Shares; (iii) issue any Common Shares to the holders of all or substantially all of the outstanding Common Shares by way of a stock dividend, the number of Common Shares which may be acquired pursuant to this Article 4 on and at any time after the effective date of such subdivision, redivision, reduction, combination or consolidation or on the record date for such issue of Common Shares by way of a stock dividend, as the case may be, shall be increased, in the case of the events referred to in (i) and (iii) above, in the proportion which the number of Common Shares outstanding before such subdivision, redivision or dividend bears to the number of Common Shares outstanding after such subdivision, redivision or dividend, or shall be decreased, in the case of the events referred to in (ii) above, in the proportion which the number of Common Shares outstanding before such reduction, combination, or consolidation bears to the number of Common Shares outstanding after such reduction, combination or consolidation and in each case the price at which the Holder Conversion shall occur will be adjusted to reflect the change in the number of Common Shares that become issuable under this Article 4.  Any such issue of Common Shares by way of a stock dividend shall be deemed to have been made on the record date fixed for such stock dividend for the purpose of calculating the number of outstanding Common Shares under this Section 4.2(a) or Section 4.2(c).

(b) In the case of any reclassification of, or other change in, the outstanding Common Shares other than a subdivision, redivision, reduction, combination or consolidation, subject to the approval of the Toronto Stock Exchange (if applicable), the Holder shall be entitled to receive upon conversion pursuant to Article IV, and shall accept in lieu of the number of Common Shares to which it was theretofore entitled upon such conversion, the kind and amount of shares and other securities or property which the Holder would have been entitled to receive as a result of such reclassification if, on the effective date thereof, it had been the registered holder of the number of Common Shares to which it was theretofore entitled upon conversion.  If necessary, appropriate adjustments shall be made in the application of the provisions set forth in this Article IV with respect to the rights and interests thereafter of the Holder to the end that the provisions set forth in this Article IV shall thereafter correspondingly be made applicable as nearly as may be possible in relation to any shares or other securities or property thereafter deliverable upon the conversion of any Debenture.  Any such adjustments shall be made by and set forth in a supplemental certificate approved by the directors of the Corporation and shall for all purposes be conclusively deemed to be an appropriate adjustment, after reasonable consultation with the Holder.

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(c) If and whenever the Corporation shall issue or distribute to all or substantially all the holders of Common Shares (i) shares of the Corporation of any class; (ii) rights, options or warrants (that shall not have expired unexercised, unconverted or unexchanged at the time a Holder converts any Debenture, in whole or in part); (iii) evidences of indebtedness; or (iv) any other assets or securities and if such issuance or distribution does not result in an adjustment as provided for in Section 4.2(a) or Section 4.2(b), subject to the approval of the Toronto Stock Exchange (if applicable), the price at which the Principal Amount may be converted into Common Shares pursuant to Article IV shall be adjusted effective immediately before the record date at which the holders of Common Shares are determined for purposes of any such issuance or distribution as aforesaid in such manner as the directors of the Corporation determine to be appropriate on a basis consistent with this Section 4.3.

(d) If, at any time, the Holder exercises its conversion rights before the record date and before the occurrence of an event, for which this Section 4.2 requires that an adjustment shall become effective immediately before the record date for such event, the Corporation may defer issuing to the Holder the additional Common Shares issuable upon such conversion, by reason of the adjustment required by such event, until the occurrence of such event.  In the event of such an adjustment, the Corporation shall deliver to the Holder an appropriate instrument evidencing the Holder's right to receive such additional Common Shares upon the occurrence of the event requiring such adjustment and the right to receive any distributions made on such additional Common Shares declared in favour of the holders of Common Shares on and before the date of conversion or such later date as such holder would, but for the provisions of this Section 4.2, have become the holder of record of such additional Common Shares.

(e) If a dispute shall at any time arise with respect to adjustments of the Conversion Price or the number of Common Shares issuable upon the conversion of this Debenture, such disputes shall be conclusively determined by the auditors of the Corporation or if they are unable or unwilling to act, by such other firm of independent chartered accountants accredited by the United States Public Company Accounting Oversight Board as may be selected by the directors and any such determination shall be conclusive evidence of the correctness of any adjustment made pursuant to this Section 4.2 hereof and shall be binding upon the Corporation and the Holder.

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4.3 No Fractional Common Shares.  Notwithstanding anything herein contained, the Corporation shall in no case be required to issue fractional Common Shares or to pay any cash adjustment in lieu of any fractional Common Share upon the conversion of the Debenture.  Any fractions will be rounded to the nearest whole number with fractions of one-half or greater being rounded to the next higher whole number and fractions of less than one-half being rounded to the next lower whole number.

4.4 Reservation of Common Shares.  The Corporation shall at all times while the Debenture remains convertible into Debenture Shares as herein provided, reserve and keep available out of its authorized but unissued share capital, for the purpose of effecting the conversion of the Debenture, such number of Common Shares as shall from time to time be sufficient to effect the conversion of the Debenture.  In the event that the Corporation does not have available such number of Common Shares required to satisfy full conversion of this Debenture into Debenture Shares, the Corporation agrees to hold a special meeting of shareholders in order to increases the number of Common Shares authorized and reserved in order to meet its obligations hereunder.

ARTICLE V 

DEFAULT

5.1 Acceleration of Maturity on Default.  Upon the happening of any one or more of the following events (herein sometimes called "Events of Default") namely:

(a) if the Corporation does not pay on the Maturity Date any principal, interest or other amount payable by it under the Debenture at the place and in the currency in which such amount is expressed to be payable;

(b) if the Corporation makes a general assignment for the benefit of creditors; or any proceeding is instituted by it seeking relief as debtor, or to adjudicate it a bankrupt or insolvent, or seeking liquidation, winding-up, reorganization, arrangement, adjustment or composition of it or its debts or for an order for similar relief under any law relating to bankruptcy, insolvency, reorganization or relief of debtors (including under any statutes relating to the incorporation of companies) or seeking appointment of a receiver or trustee, or other similar official for it or for any substantial part of its properties or assets; or any corporate or partnership action is taken to authorize any of the actions referred to in this Section 5.1(b);

(c) if any proceedings are instituted against the Corporation seeking to adjudicate it a bankrupt or insolvent, or seeking liquidation, winding-up, reorganization, arrangement, adjustment or composition of it or its debts or an order for similar relief under any law relating to bankruptcy, insolvency, reorganization or relief of debtors (including under any statutes relating to the incorporation of companies) or seeking appointment of a receiver, trustee or other similar official for it or for any substantial part of its properties or assets and such proceeding is not dismissed within sixty (60) days of its service on the Corporation;

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(d) if the Corporation takes any corporate proceedings for its dissolution, liquidation or if the corporate existence of the Corporation shall be terminated by expiration, forfeiture or otherwise, or if the Corporation ceases or threatens to cease, to carry on all or a substantial part of its business;

(e) the date the Holder intends to convert this Debenture into Debenture Shares in accordance with the terms set out herein, the Corporation fails to have available out of its authorized but unissued share capital, for the purpose of effecting the conversion of this Debenture, such number of Common Shares as shall from time to time be sufficient to effect the conversion of this Debenture; and

(f) if the Corporation is in material breach of the listing requirements of the Toronto Stock Exchange

then in each and every such event, and provided that the Corporation has been provided with fifteen (15) days to cure such Event of Default (except for Subsection 5.1(c) which allows sixty (60) days to cure), the Principal Sum and interest on the Debenture shall forthwith become immediately due and payable to the Holder, anything herein contained to the contrary notwithstanding, and the Corporation shall forthwith pay to the Holder of the Debenture the amount of the Principal Sum and interest then accrued but unpaid on the Debenture and all other moneys payable under the provisions hereof together with interest at the rate of interest borne by the Debenture on such Principal Sum and interest from the date of the said Event of Default until payment is received by the Holder, and any moneys so received by the Holder shall be applied in the manner provided in Section 8.1.  Notwithstanding the foregoing, the Holder shall have the option, if it so chooses, at any time upon the occurrence of an Event of Default that remains uncured at the conclusion of the applicable cure period referenced herein, to convert this Debenture into Common Shares (the “Event of Default Conversion”) at the lower of (i) US$0.80, or (ii) the volume weighted average trading price of the Common Shares as indicated on the Toronto Stock Exchange, or if not then listed on the Toronto Stock Exchange, then on the OTCBB for the ten (10) consecutive trading days immediately preceding the date set for the Event of Default Conversion, provided that such price will not be  less than  $0.50 per share.

5.2 Waiver of Corporation's Rights.  To the full extent that it may lawfully do so, the Corporation for itself and its successors and assigns hereby waives and disclaims any benefit of, and shall not have or assert any right under, any statute or rule of law pertaining to the marshaling of assets, discussion, division or other matter whatever, to defeat, reduce or affect the rights of the Holder under the terms of this Debenture.

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ARTICLE VI

SECURITY

6.1 Security. Payment of the Principal Sum and of any Interest is secured by a first lien on the assets of the Corporation and its subsidiaries, subject to permitted encumbrances (the “Secured Interest”). To this effect, the security interest provided to and granted in favour of the Holder hereunder shall be documented by the relevant instrument under the Uniform Commercial Code and be filed with all necessary regulatory authorities, and be registered in all necessary public registers, such that a legal, valid and enforceable security interest on the Security Interest be created exclusively in favour of the Holder. Such Secured Interest shall remain in full force and effect for so long as any obligation of the Corporation hereunder remains outstanding. Without limiting the foregoing, the Secured Interest shall include a pledge and assignment agreement as well as a general security agreement, both of which must be in recordable form acceptable to Holder’s counsel, acting reasonably.

ARTICLE VII

WAIVER

7.1 Waiver.  The Holder may waive any breach of any of the provisions contained in this Debenture or any default by the Corporation in the observance or performance of any covenant, condition or obligation required to be observed or performed by it under the terms of this Debenture.  No waiver, consent, act or omission by the Holder shall extend to or be taken in any manner whatsoever to affect any other or subsequent breach or default or the rights resulting therefrom and no waiver or consent by the Holder shall bind the Holder unless it is in writing.  The inspection or approval by the Holder of any document or matter or thing done by the Corporation shall not be deemed to be a warranty or holding out of the adequacy, effectiveness, validity or binding effect of such document, matter or thing or a waiver of the Corporation's obligations.

ARTICLE VIII 

OTHER RIGHTS OF THE HOLDER

8.1 Rights of Set-Off.  The Corporation acknowledges and agrees that the Principal Sum and the other obligations hereunder shall be paid, satisfied and discharged to the Holder without regard to such dealings as may from time to time occur as between any one or more of the Holder, the Corporation and any other person and without regard to such equities or rights of set-off or counterclaim which may from time to time exist between any one or more of the Holder, the Corporation or any other person, and that the Principal Sum and other obligations hereof shall be paid without regard to any equities between the Corporation and the Holder hereof or any set-off or cross-claims and the receipt of the Holder for the payment of the Principal Sum will be a good discharge to the Corporation in respect thereof.

8.2 No Merger.  Neither the taking of any judgement nor the exercise of any rights hereunder shall operate to extinguish the obligation of the Corporation to pay the monies under this Debenture and shall not operate as a merger of any covenant in this Debenture, and the acceptance of any payment shall not constitute or create a novation, and the taking of a judgement or judgements under a covenant herein contained shall not operate as a merger of those covenants and affect the Holder's right to interest under this Debenture.

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ARTICLE IX

ADMINISTRATIVE PROVISIONS

9.1 Transfer of Debenture.  This Debenture may be transferred only by transfer in writing in the form attached hereto as Schedule "B", and will only be effective as regards the Corporation when delivered at the registered office of the Corporation in Cameron Park, California accompanied by this Debenture together with such evidence of identity or title as the Corporation may reasonably require and upon payment of all applicable transfer taxes.  Thereupon, the Corporation will record such transfer on its books and issue a new debenture to the transferee in exchange for this Debenture.

9.2 Registered Holders.  The person in whose name this Debenture shall be registered shall be deemed and regarded as the owner and holder hereof for all purposes, and the payment to and/or receipt of any Holder for any Principal Sum or interest hereby secured shall be a good discharge of the Corporation for the same, and the Corporation shall not be bound to enter in the register notice of any trust or to inquire into the title of any Holder or to recognize any trust or equity affecting the title hereof save as ordered by some court of competent jurisdiction or as required by statute.

ARTICLE X

MISCELLANEOUS

10.1 Time.  Time shall be of the essence of this Debenture.

10.2 Governing Law.  This Debenture shall be governed by, and construed in accordance with, the laws of the Province of Ontario and the laws of Canada applicable therein but the reference to such laws shall not, by conflict of laws rules or otherwise, require the application of the law of any jurisdiction other than the Province of Ontario.  The Corporation hereby irrevocably attorns to the jurisdiction of the Courts of the Province of Ontario except that US law shall apply to UCC matters.

10.3 Severability.  If any one or more of the provisions or parts thereof contained in this Debenture should be or become invalid, illegal or unenforceable, the remaining provisions or parts thereof contained herein shall be and shall be conclusively deemed to be, severable therefrom and the validity, legality or enforceability of such remaining provisions or parts thereof shall not in any way be affected or impaired by the severance of the provisions or parts thereof severed.

10.4 Headings.  The headings of the articles, sections, subsections and clauses of this Debenture have been inserted for convenience and reference only and do not define, limit, alter or enlarge the meaning of any provision of this Debenture.

10.5 Binding Effect.  This Debenture and all of its provisions shall enure to the benefit of the Holder, its successors and assigns, and shall be binding upon the Corporation and its successors and permitted assigns.  The expression the "Holder" as used herein shall include the Holder's assigns whether immediate or derivative.

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10.6 Notices.  Any notice required or permitted to be given under any of this Debenture or any tender or delivery of documents may be given by personal delivery or by facsimile transmission to the parties at the following addresses:

(a)       to the Holder at:

l

(b)       to the Corporation at:

Firstgold Corp.

3108 Ponte Morino Drive, Suite 210

Cameron Park

CA 95682

Attention: Mr. Steve Akerfeldt

Fax: (530) 698-4995

Any notice or delivery shall be given as herein provided or to such other addresses or telecopier number or in care of such other person as a party may from time to time advise by notice in writing as aforesaid.  The date of receipt of such notice or delivery shall be the date of actual delivery to the address specified if delivered or the date of actual transmission to the telecopier number if telecopied, unless such date is not a Business Day, in which event the date of receipt shall be the next Business Day immediately following the date of such delivery or transmission.

ARTICLE XI

11.1  Arranging Fee.  Upon Closing, the Corporation shall pay to the Holder or as the Holder may direct the amount of US$100,000, which amount will be netted out of the Principal Sum advanced at Closing .

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IN WITNESS WHEREOF the Corporation has duly executed these presents as of the date first above by its duly authorized officer.

FIRSTGOLD CORP.
Per:	/s/ Stephen Akerfeldt
Name:	Stephen Akerfeldt
Title:	Chief Executive Officer

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SCHEDULE "A"

CONVERSION FORM

TO:           FIRSTGOLD CORP. (the "Corporation")

The undersigned registered holder of the convertible debenture (the "Debenture") represented by the within certificate hereby subscribes for Debenture Shares of the Corporation pursuant to the within Debenture certificate on the terms specified in the within Debenture certificate, to the extent of US$______________ of Principal Sum, which certificate is hereby tendered to the Corporation and which will, upon due issuance of the Units aforesaid and, if required, any replacement certificate for any portion of the Debenture not converted, be null and void.

The Debenture Shares subscribed for will be issued as set forth below and will be mailed to the address set forth below.

DATED this   day of  , 200 

If subscriber is a corporation:
	By:
	Name:
	Title:

If subscriber is an individual:
Witness	Signature of Subscriber

Signature guaranteed:

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The signature must be guaranteed by a Canadian chartered bank or a member of a recognized stock exchange or other entity acceptable to the Trustee.

Print below the name and address in full of the Person in whose name the Debenture Shares subscribed for are to be issued.  If the Debenture Shares subscribed for are to be issued to more than one person, similar information must be provided for each person, as well as the number of Debenture Shares to be issued to each.  (If any of the Debenture Shares are to be issued to a person or persons other than the holder of the within Debenture certificate, the holder must pay to the Corporation all requisite taxes.)

Name:
Address:
Social Insurance Number	Postal Code

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SCHEDULE "B"

TRANSFER FORM

FOR VALUE RECEIVED, the undersigned hereby sells, assigns and transfers to (name of transferee) US$ (indicate principal amount of debentures being transferred) principal amount of convertible debentures of Firstgold Corp. represented by certificate(s) no.  (indicate number(s) of certificate(s) being transferred) and irrevocably constitutes and appoints  (indicate name of transferee) attorney to transfer such debenture(s) on the securities register of Firstgold Corp., with full power of substitution.

DATED:                                                            

IF TRANSFEROR IS A CORPORATION:

By:

Name:

Title:

If transferor is an individual:
Witness	Signature of Transferor

Signature guaranteed:

The signature must be guaranteed by a Canadian chartered bank or a member of a recognized stock exchange or other entity acceptable to the Trustee.

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EX-31.1

Exhibit 31.1

CERTIFICATION FOR QUARTERLY REPORTS ON FORM 10-Q

I, Stephen Akerfeldt, certify that:

1.           I have reviewed this quarterly report on Form 10-Q of Firstgold Corp. (“Registrant”);

2           Based on my knowledge, this quarterly report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this quarterly report;

3.           Based on my knowledge, the financial statements, and other financial information included in this quarterly report, fairly present in all material respects the financial condition, results of operations and cash flows of the Registrant as of, and for, the periods presented in this quarterly report;

4.           The Registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-14 and 15d-14) for the Registrant and we have:

a)           designed such disclosure controls and procedures to ensure that material information relating to the Registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this quarterly report is being prepared;

b)           evaluated the effectiveness of the Registrant's disclosure controls and procedures as of a date within 90 days prior to the filing date of this quarterly report (the "Evaluation Date"); and

c)           presented in this quarterly report our conclusions about the effectiveness of the disclosure controls and procedures based on our evaluation as of the Evaluation Date;

5.           The Registrant's other certifying officer and I have disclosed, based on our most recent evaluation, to the Registrant's auditors and the audit committee of Registrant's board of directors (or persons performing the equivalent function):

a)           all significant deficiencies in the design or operation of internal controls which could adversely affect the Registrant's ability to record, process, summarize and report financial data and have identified for the Registrant's auditors any material weaknesses in internal controls; and

b)           any fraud, whether or not material, that involves management or other employees who have a significant role in the Registrant's internal controls; and

6.           The Registrant's other certifying officer and I have indicated in this quarterly report whether or not there were significant changes in internal controls or in other factors that could significantly affect internal controls subsequent to the date of our most recent evaluation, including any corrective actions with regard to significant deficiencies and material weaknesses.

Date:  June 23, 2008	/s/ Stephen Akerfeldt
	Stephen Akerfeldt, Chief Executive Officer

EX-31.2

Exhibit 31.2

CERTIFICATION FOR QUARTERLY REPORTS ON FORM 10-Q

I, James Kluber, certify that:

1.           I have reviewed this quarterly report on Form 10-Q of Firstgold Corp. (“Registrant”);

2.           Based on my knowledge, this quarterly report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this quarterly report;

3.           Based on my knowledge, the financial statements, and other financial information included in this quarterly report, fairly present in all material respects the financial condition, results of operations and cash flows of the Registrant as of, and for, the periods presented in this quarterly report;

4.           The Registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-14 and 15d-14) for the Registrant and we have:

a)           designed such disclosure controls and procedures to ensure that material information relating to the Registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this quarterly report is being prepared;

b)           evaluated the effectiveness of the Registrant's disclosure controls and procedures as of a date within 90 days prior to the filing date of this quarterly report (the "Evaluation Date"); and

c)           presented in this quarterly report our conclusions about the effectiveness of the disclosure controls and procedures based on our evaluation as of the Evaluation Date;

5.           The Registrant's other certifying officer and I have disclosed, based on our most recent evaluation, to the Registrant's auditors and the audit committee of Registrant's board of directors (or persons performing the equivalent function):

a)           all significant deficiencies in the design or operation of internal controls which could adversely affect the Registrant's ability to record, process, summarize and report financial data and have identified for the Registrant's auditors any material weaknesses in internal controls; and

b)           any fraud, whether or not material, that involves management or other employees who have a significant role in the Registrant's internal controls; and

6.           The Registrant's other certifying officer and I have indicated in this quarterly report whether or not there were significant changes in internal controls or in other factors that could significantly affect internal controls subsequent to the date of our most recent evaluation, including any corrective actions with regard to significant deficiencies and material weaknesses.

Date: June 23, 2008	/s/ James Kluber
	James Kluber, Chief Financial Officer

EX-32.2

Exhibit 32

CERTIFICATION

PURSUANT TO SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

(SUBSECTIONS (a) AND (b) OF SECTION 1350, CHAPTER 63 OF

TITLE 18, UNITED STATES CODE)

Pursuant to section 906 of the Sarbanes-Oxley Act of 2002 (subsections (a) and (b) of section 1350, chapter 63 of Title 18, United States Code), the undersigned officers of Firstgold, Corp., a Delaware corporation (the “Company”), do hereby certify with respect to the Quarterly Report of Firstgold on Form 10-Q for the quarter ended April 30, 2008 as filed with the Securities and Exchange Commission (the "10-Q Report") that:

(1)           the 10-Q Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

(2)           the information contained in the 10-Q Report fairly presents, in all material respects, the financial condition and results of operations of Firstgold.

	FIRSTGOLD CORP.
Dated: June 23, 2008	/s/ Stephen Akerfeldt
	Stephen Akerfeldt, Chief Executive Officer
Dated: June 23, 2008	/s/ James Kluber
	James Kluber, Chief Financial Officer