Firstgold Corp (fka FGOCQ)

[7Secret7Service7]

An $87M Equivalent Bid Recieved .29 PPS

If we get that then $87M-$32M liabilites= $55M for shareholders or PPS .29 based on our 196M O/S.

In July 2009 a Chinese company offered FGOC $26.5M for a 51% stake in the company when gold was 900/oz. A 100% offer would have been $53M. This was knowing all assets & liabilities + the NOL's. Gold is now 1374/oz. They made a great bid offer, but were rejected for security reasons by the U.S. government because FGOC is near a Navy base. Gold is now 64% higher than it was in July 2009. The $53M bid for 100% would now be $87M.

Read pages 25-29 to see the Chinese offer.

http://www.sec.gov/Archives/edgar/data/878808/000117120009001048/i00500_firstgold-10q.htm

Restructuring Transaction

On July 16, 2009 we entered into a Binding Offer Letter with Northwest Non-Ferrous International Investment Company, Limited (“Northwest”) which has its headquarters in Xi’an Shaanxi Province, China. The Binding Offer Letter was amended on August 7,

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2009. Pursuant to the Binding Offer Letter, the parties have agreed to prepare and enter into definitive agreements having an aggregate value of approximately $26,500,000 and to make certain fundamental changes to Firstgold’s Certificate of Incorporation and Bylaws to give effect to the Restructure transaction which collectively are referred to herein as the “Restructuring.” The capital infusion by Northwest will consist of three components. All dollar amounts are stated in US dollars.

Purchase of Notes

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

Working Capital Loan

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

Subscription for Shares

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

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Structural Changes Required by Northwest

As part of the Restructuring, Northwest is allowed to nominate three directors to the Firstgold Board of Directors with Mr. Sun Feng (Chairman of Northwest) being designated as the new Chairman of the Firstgold Board. In addition, the Amended and Restated Certificate of Incorporation will be amended to provide for the Chairman of the Board to have a “casting vote” meaning that in case of a tie vote on any matter properly coming before the Board, the Chairman will have two votes compared to one vote by each of the remaining Directors thus allowing the Chairman the deciding vote in case of a tie vote on the Board. Northwest will also be granted certain preemptive rights allowing it to maintain its 51% ownership interest when and if currently outstanding warrants are exercised.

Financial Changes Required by Northwest

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

Voluntary Changes Deemed Beneficial to Firstgold

In addition to the changes required by Northwest described above, the Company is seeking stockholder approval for several other changes which the Board believes to appropriate at this time including increasing its authorized shares to 900,000,000 shares, increasing the number of shares issuable pursuant to the Company’s 2006 Stock Option Plan and amending and restating the Company’s Bylaws.

Regulatory Requirements

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

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

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Due to the type of transaction involved and the nature of Northwest as a Chinese entity, Northwest and Firstgold filed an application with the Committee on Foreign Investment in the United States (“CFIUS”) on October 6, 2009. The purpose of such application is to allow CFIUS to evaluate if any issues affecting national security are included in the proposed Restructuring. While neither Northwest or Firstgold anticipated any objections based on national security concerns, such application process is anticipated to take approximately 45 to 60 days to complete. Northwest has determined to wait for CFIUS clearance before proceeding with the Restructuring Transaction. By letter dated November 6, 2009, CFIUS informed Firstgold and Northwest that additional time to evaluate the application was needed and implemented an additional 45 days to complete their review and recommendations. In early December Northwest and Firstgold representatives had several discussions with the CFIUS staff during which the CFIUS staff indicated they would disapprove the Restructuring Transaction. CFIUS noted the proximity of the Firstgold properties to the Fallon Naval Air Station. Despite further discussions to address the CFIUS concerns, CFIUS ultimately concluded by mid December that no mitigation plan could resolve the national security concerns raised in their investigation. On December 21, 2009 Northwest formally withdrew the Application and indicated it would not proceed with the Restructuring Transaction. In light of these developments Firstgold has had preliminary talks with other interested parties looking at investing in or acquiring Firstgold.

Extension of Restructuring Transaction

The purchase of the PL Notes was expected to occur on or before August 31, 2009 however this date was extended to October 31, 2009 and then to November 17, 2009. However, additional time was required to obtain necessary regulatory approvals including the filing of a joint application by Northwest and Firstgold with the Committee on Foreign Investment in the United States (“CFIUS”) on October 6, 2009 relating to the proposed acquisition of Firstgold shares by Northwest and the acquisition of the PL Notes. Due to the ongoing CFIUS review, the Lenders entered into Extension Agreements effective as of September 15, 2009 to extend the Closing Date to October 31, 2009 and effective as of October 31, 2009 to extend the Closing Date to November 17, 2009. $220,000 was paid to the Lenders as payment for the extension through the end of October. Pursuant to the October 31, 2009 extension, Firstgold is required to pay an additional $220,000 at closing to the Lenders for agreeing to extend the Closing Date.

On November 6, 2009 the Registrant was informed by CFIUS that additional time was required to complete their review of the Application pursuant to applicable authority. Until CFIUS approval is obtained, Northwest is unable to fund the transactions under the Binding Offer Letter. Consequently, the parties entered into another Extension Agreement dated November 20, 2009 (the “November Extension”). Pursuant to the November Extension Platinum/Lakewood agreed to extend the time in which Northwest had to acquire the PL Notes to December 30, 2009. In return Firstgold agreed to reduce the exercise price of Warrants held by the Lenders to acquire 15,000,000 shares of Firstgold common stock from $0.145/share to $0.075/share and extend the term from August 7, 2011 to August 7, 2012. The Lenders are also permitted, at their option, to exchange the Warrant for convertible promissory notes with an aggregate principal

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amount of $3,000,000 due on December 1, 2010 and convertible into Firstgold shares equal to 9.9% of Firstgold’s then outstanding common stock. The November Extension also required Firstgold to secure a minimum of $300,000 of working capital to fund Firstgold’s operations until December 30, 2009. As of November 27, 2009 Firstgold had raised an additional $350,000 of working capital.

Information about Northwest

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

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