UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 20-F

(Amendment No. 1)

(Amending Item 8)

[  ]	REGISTRATION STATEMENT PURSUANT TO SECTION 12(b) OR (g) OF THE SECURITIES EXCHANGE ACT OF 1934
OR
[X]	ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For fiscal year ended February 28, 2011
OR
[  ]	TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from ____ to ______
OR
[  ]	SHELL COMPANY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
Date of event requiring this shell company report:
Commission file number: 000-30084
Linux Gold Corp.
(Exact name of Registrant as specified in its charter)
N/A
(Translation of Registrant’s name into English)
British Columbia, Canada
(Jurisdiction of incorporation or organization)
240-11780 Hammersmith Way, Richmond, British Columbia V7A 5E9, Canada
(Address of principal executive offices)
John Robertson, President
240-11780 Hammersmith Way, Richmond, British Columbia V7A 5E9, Canada Phone: 604-278-5996 Fax 604-278-3409
(Name, Telephone, E-mail and/or Facsimile number and Address of Company Contact Person)
Securities registered or to be registered pursuant to Section 12(b) of the Act.
None
Securities registered or to be registered pursuant to Section 12(g) of the Act.
Common Shares, No Par Value
(Title of Class)
Securities for which there is a reporting obligation pursuant to Section 15(d) of the Act.
Not Applicable
(Title of Class)
Indicate the number of outstanding shares of each of the issuer’s classes of capital or common stock as of the close of the period covered by the annual report.
97,893,825 Common Shares outstanding as of February 28, 2011

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

If this report is an annual or transition report, indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934.

[  ] Yes [X] No

Note – Checking the box above will not relieve any registrant required to file reports pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 from their obligations under those Sections.

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.

[X] Yes [  ] No

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

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

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

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

If “Other” has been checked in response to the previous question, indicate by check mark which financial statement item the registrant has elected to follow.

Item 17. [  ] Item 18. [X]

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

PART I

ITEM 8.   FINANCIAL INFORMATION

A. CONSOLIDATED STATEMENTS AND OTHER FINANCIAL INFORMATION

Our consolidated financial statements and the accompanying notes have been prepared in conformity with accounting principles generally accepted in the United States (“GAAP”) and are presented in Canadian dollars. These financial statements have been prepared in accordance with the FASB ASC 915 “Development-Stage Entities”. A development-stage enterprise is one in which planned principal operations have not commenced or if its operations have commenced, there has been no significant revenue therefrom. Development-stage companies report cumulative loss from the inception of its development-stage activities. These consolidated financial statements for the fiscal year ended February 28, 2011, contain:

- Report of Independent Registered Public Accounting Firm dated June 28, 2011 of ACAL Group, Chartered Accountants

- Consolidated Balance Sheets as at February 28, 2011 and February 28, 2010 (Restated)

- Consolidated Statements of Operations and Comprehensive Loss as at February 28, 2011, February 28, 2010 (Restated) and February 28, 2009

- Consolidated Statements of Cash Flows as at February 28, 2011, February 28, 2010 and February 28, 2009

- Consolidated Statements of Stockholders’ Deficit, March 1, 2003 to February 28, 2011

- Notes to the Consolidated Financial Statements as at February 28, 2011 and 2010

Legal Proceedings and Regulatory Actions

During the fiscal year ended February 28, 2011, we were not and are not currently a party to, nor are any of our properties the subject of, any legal proceedings for which the outcome could have a material adverse affect on our company, nor, to our knowledge, are we to be a party to any contemplated legal proceedings, the outcome of which could have a material adverse affect on our company.

There have been no penalties or sanctions imposed against us by a court relating to securities legislation or by a securities regulatory authority during the fiscal year ended February 28, 2011, or any other time that would likely be considered important to a reasonable investor making an investment decision in our company, and we have during the fiscal year ended February 28, 2011.

Dividend Distribution Policy

We have not paid any cash dividends to date and we do not intend to pay cash dividends in the foreseeable future.

B. SIGNIFICANT CHANGES

None.

2

ITEM 19.   EXHIBITS

EXHIBIT #
1.1	Memorandum and articles of incorporation with bylaws dated February 27, 1979	(1)
1.2	Altered memorandum and special resolution dated September 20, 1993 increasing the authorized capital to 100,000,000 common shares from 90,000,000 and redesignating Class “A” Common voting shares without par value as common shares without par value and redesignating Class “B” Common non-voting shares as common shares without par value	(1)
1.3	Altered memorandum and special resolution dated March 15, 2000 changing the name of the Company from Flame Petro-Minerals Corp. to LinuxWizardry Systems, Inc.	(3)
1.4	Altered memorandum and special resolution dated February 20, 2003 changing the name of the Company from LinuxWizardry Systems, Inc. to Linux Gold Corp.	(5)
1.5	Memorandum and articles of incorporation amended effective September 15, 2004	(7)
2.1	Specimen copy of Registrant’s common share certificate	(2)
4.1	Commitment by John G. Robertson dated July 16, 1999 to provide financing to the Registrant as required for ongoing operations	(2)
4.2	Share Purchase Agreement dated January 7, 2000 between Flame Petro-Minerals Corp. and Mike Carpenter and LinuxWizardry, Inc.	(3)
4.3	Purchase order dated May 22, 2000 between LinuxWizardry, Inc. and Motorola, Inc., Personal Communications Sector	(4)
4.4	License Agreement dated June 30, 2000 between LinuxWizardry Systems, Inc. and LinuxWizardry, Inc. and Lineo, Inc	(4)
4.5	Vendor Agreement dated January 5, 2001 between Merrimack Services Corporation d/b/a PC Connection  and LinuxWizardry Systems, Inc.	(4)
4.6	Joint Venture Agreement between Linux Gold Corp. and Teryl Resources Corp. dated March 5, 2002	(5)
4.7	Amendment to Joint Venture Agreement between Linux Gold Corp. and Teryl Resources Corp. dated November 4, 2002	(5)
4.8	Edward Skoda Purchase Agreement – TY Gold Property	(6)
4.9	Edward Skoda Purchase Agreement – ORO Mineral Claims	(6)
4.10	Property Option Agreement – Peter Tse	(6)
4.11	Amendment to Joint Venture Agreement between Linux Gold Corp. and Teryl Resources Corp. dated March 5, 2007	(8)
4.12	Amendment to Joint Venture Agreement between Linux Gold Corp. and Teryl Resources Corp. dated March 5, 2009	(11)
4.13	Premises Lease Agreement between Linux Gold Corp. and Pensionfund Realty Limited dated November 1, 2009	(11)
4.14	Exploration Rights Agreement between Linux Gold Corp. and Peter S. Frantz dated January 20, 2010 for the Coho Claims, Alaska	(11)
4.15	Exploration Rights Agreement between Linux Gold Corp. and Peter S. Frantz dated January 20, 2010 for the Trout Claims, Alaska	(11)
4.16	Amendment to Joint Venture Agreement between Linux Gold Corp. and Teryl Resources Corp. dated March 5, 2010	(11)
11.1	Code of Business Conduct and Ethics	(12)
12.1	Certification of CEO pursuant to Title 18, United States Code, Section 1350 as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002	(13)
12.2	Certification of CFO pursuant to Title 18, United States Code, Section 1350 as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002	(13)
13.1	Certification of CEO pursuant to Title 18, United States Code, Section 1350 as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002	(13)
13.2	Certification of CFO pursuant to Title 18, United States Code, Section 1350 as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002	(13)
15.1	Consent of Independent Registered Public Accounting Firm	(13)

(1) incorporated by reference to our Registration Statement on Form 20-F filed on June 4, 1999 with the SEC

(2) incorporated by reference to our Amendment No. 1 to the Registration Statement dated July 22, 1999

(3) incorporated by reference to our annual report on Form 20-F filed on September 14, 2000

(4) incorporated by reference to our annual report on Form 20-F filed on July 14, 2001

(5) incorporated by reference to our annual report on Form 20-F filed on August 25, 2003

(6) incorporated by reference to our annual report on Form 20-F filed on July 19, 2004

(7) incorporated by reference to our annual report on Form 20-F filed on July 19, 2005

(8) incorporated by reference to our annual report on Form 20-F filed on July 23, 2007

(9) incorporated by reference to our annual report on Form 20-F filed on September 2, 2008

(10) incorporated by reference to our annual report on Form 20-F filed on September 14, 2009

(11) incorporated by reference to our annual report on Form 20-F filed on June 6, 2010

(12) incorporated by reference to our Form 6-K filed on March 16, 2011

(13) filed herewith in this amended annual report on Form 20-F

3

SIGNATURE PAGE

The Registrant hereby certifies that it meets all of the requirements for filing on Form 20-F and that it has duly caused and authorized the undersigned to sign this transitional report on its behalf.

		LINUX GOLD CORP.
		Registrant
Dated: May 11, 2012	By:	/s/ John G. Robertson
		John G. Robertson
		President, Chairman of the Board and Director

4

Linux Gold Corp.

(An Exploration Stage Company)

Amended Consolidated Financial Statements

(Expressed in Canadian Dollars)

28 February 2011

5

1066 WEST HASTINGS STREET

VANCOUVER, BC V6E 3X2

T: 604.683.3850 F: 604.688.8479 ACAL GROUP CHARTERED ACCOUNTANTS PCAOB & CPAB Registrant

REPORT ON INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To:	the Board of Directors and Stockholders of
	Linux Gold Corp. (An Exploration Stage Company)

We have audited the accompanying consolidated balance sheets of Linux Gold Corp. (the “Company”) (An Exploration Stage Company) as of February 28, 2011 and 2010, and the related consolidated statements of operations and comprehensive loss, stockholders’ equity (deficit), and cash flows for the years ended February 28, 2011 and 2010. These financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on these consolidated financial statements based on our audits. The consolidated financial statements of the Company for the year ended February 28, 2009 were reported upon by other auditors whose report, dated June 15, 2009, expressed an unqualified opinion on those statements and included an explanatory paragraph regarding the Company’s ability to continue as a going concern. The other auditors’ report have been furnished to us, and our opinion, insofar as it relates to amounts included for such prior periods, is based solely on the report of such other auditors.

We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. The company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. Our audits included consideration of internal control over financial reporting as a basis for designing audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the company’s internal control over financial reporting. Accordingly, we express no such opinion. An audit also includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements, assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion.

In our opinion, the consolidated financial statements present fairly, in all material respects, the financial position of the Company as of February 28, 2011 and 2010, and the results of its operations and its cash flows for the years ended February 28, 2011 and 2010 in conformity with accounting principles generally accepted in the United States of America.

The accompanying consolidated financial statements have been prepared assuming that the Company will continue as a going concern. As discussed in Note 1 to the consolidated financial statements, the Company has not generated revenues since inception, has incurred losses in developing its business, and further losses are anticipated. The Company requires additional funds to meet its obligations and the costs of its operations. These factors raise substantial doubt about the Company’s ability to continue as a going concern. Management’s plans in this regard are described in Note 1. The consolidated financial statements do not include any adjustments that might result from the outcome of this uncertainty.

As described in Note 15, the consolidated financial statements for the year ended February 28, 2010 have been restated.

As described in Note 16, the consolidated statements of operations and comprehensive loss and cash flows for the period from inception of exploration stage on March 1, 2003 through February 28, 2011, and the consolidated statements of stockholders’ equity (deficit) for the period from March 1, 2003 through February 28, 2008 with the related disclosures in the Notes have been marked as “Unaudited”.

“ACAL Group”

Chartered Accountants

Vancouver, British Columbia

June 28, 2011, (except as to Note 16 which is as of May 10, 2012)

F-1

Linux Gold Corp.

(An Exploration Stage Company)

Consolidated Balance Sheets

(Expressed in Canadian Dollars)

	As at  28 February 2011 $			As at  28 February 2010 (Restated Note 15) $
Assets
Current
Cash and cash equivalents		2,210			182
Goods and services tax receivable		5,300			3,922
Marketable securities (Note 3)		102,255			191,330
Prepaid expenses and deposits		3,738			3,863
		113,503			199,297
Property and equipment (Note 4)		5,326			6,947
		118,829			206,244
Liabilities
Current
Accounts payable (Note 6)		90,170			131,628
Accrued liabilities		19,500			19,000
Due to related parties (Note 7)		350,964			313,490
Current derivative liabilities (Note 13)		138,465			8,939
		599,099			473,057
Non-current derivative liabilities (Note 13)		-			475,419
Stockholders’ deficit
Capital stock (Note 9)
Authorized
200,000,000 common shares without par value
Issued and outstanding
28 February 2011 –  97,893,825 common shares
28 February 2010 –  92,650,825 common shares		13,573,641			13,407,308
Donated capital		478,566			423,030
Accumulated other comprehensive loss		-			(76,687	)
Deficit, accumulated from prior operations		(7,524,145	)		(7,524,145	)
Deficit, accumulated during the exploration stage		(7,008,332	)		(6,971,738	)
		(480,270	)		(742,232	)
		118,829			206,244

Nature and Continuance of Operations (Note 1), Commitments (Note 10) and Subsequent Events (Note 14)

On behalf of the Board:

“John Robertson” Director “Jennifer Lorette” Director

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

F-2

Linux Gold Corp.

(An Exploration Stage Company)

Consolidated Statements of Operations and Comprehensive Loss

(Expressed in Canadian Dollars)

	Cumulative from inception of exploration stage on 1 March 2003 to 28 February 2011 (Unaudited)			For the year ended 28 February 2011			For the year ended 28 February 2010 (Restated – Note 15)			For the year ended 28 February 2009
	$			$			$			$
General and administrative expenses
Amortization of debt issue costs		205,242			-			-			-
Amortization of property and equipment		30,668			1,621			2,151			2,867
Bad debt expense		84,952			-			-			-
Consulting and subcontracts		1,692,480			137,398			137,281			124,751
Filing and regulatory fees		172,075			13,261			18,841			22,034
Foreign exchange loss (gain)		(38,470	)		(2,938	)		(26,010	)		29,459
Imputed interest (Note 7)		273,066			55,536			39,069			26,143
Interest expense		2,302,583			-			-			-
Management fees (Note 8)		244,750			30,000			30,000			30,000
Mineral property exploration and development costs (Note 5)		1,920,338			54,276			50,975			61,885
Office, rent and telephone		735,601			38,759			39,167			57,228
Professional fees		448,943			34,456			37,323			79,189
Travel and promotion		981,096			23,570			77,825			104,249
Net loss before other items		(9,053,324	)		(385,939	)		(406,622	)		(537,805	)
Other items
Realized gain (loss) on sale of marketable security		56,146			(1,306	)		57,452			-
Realized (loss) on reallocation from Accumulated Other Comprehensive Loss		(91,303	)		(30,900	)		(60,403	)		-
Impairment on available-for-sale investments		(57,837	)		(57,837	)		-			-
Fair value adjustment of derivative liabilities		1,807,110			439,388			343,588			-
Mineral property acquisition costs written off		(126,417	)		-			-			-
Accounts payable written off		46,281			-			-			-
Income from discontinued operations		369,213			-			-			-
Interest income		41,799			-			-			1,604
Net loss for the period		(7,008,332	)		(36,594	)		(65,985	)		(536,201	)
Basic and diluted net loss per share					(0.00	)		(0.00	)		(0.01	)
Weighted average number of common shares used in per share calculations					94,040,367			89,464,012			86,536,209
Comprehensive loss
Net loss for the period		(7,008,332	)		(36,594	)		(65,985	)		(536,201	)
Loss realized on investments disposal transferred to earning		91,303			30,900			60,403			-
Unrealized holding gain (loss) on available-for-sale investments		(91,303	)		45,787			130,910			(208,000	)
Comprehensive income (loss)		(7,008,332	)		40,093			125,328			(744,201	)
Comprehensive loss per share					(0.00	)		(0.00	)		(0.01	)

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

F-3

Linux Gold Corp.

(An Exploration Stage Company)

Consolidated Statements of Cash Flows

(Expressed in Canadian Dollars)

	Cumulative from inception of exploration stage on 1 March 2003 to 28 February 2011 (Unaudited)			For the year ended 28 February 2011			For the year ended 28 February 2010			For the year ended 28 February 2009
	$			$			$			$
Cash flows used in operating activities
Net loss for the period		(7,008,332	)		(36,594	)		(65,985	)		(536,201	)
Adjustments to reconcile loss to net cash used by operating activities
Amortization of debt issue costs		205,242			-			-			-
Amortization of property and equipment		30,668			1,621			2,151			2,867
Receipt of marketable securities for property		(16,000	)		-			-			-
Accretion of discount on convertible debt		2,291,794			-			-			-
Bad debt expense		84,952			-			-			-
Imputed interest		273,066			55,536			39,069			26,143
Accounts payable written off		(46,281	)		-			-			-
Mineral property acquisition costs written off		126,417			-			-			-
Stock-based compensation		269,845			505			790			-
Shares issued for services		120,000			-			-			-
Shares issued for settlement of rent obligation		19,200			-			-			-
Impairment on investments		57,837			57,837			-			-
Fair value adjustment of derivative liabilities		(1,807,110	)		(439,388	)		(343,588	)		-
Net loss on sale of marketable securities		35,157			32,206			2,951			-
Income from discontinued operations		(369,213	)		-			-			-
Changes in operating assets and liabilities
Goods and Services Tax receivable		39,605			(1,378	)		4,016			(3,647	)
Prepaid expenses and deposits		(3,247	)		125			149			14,419
Accounts payable and accrued liabilities		(169,209	)		(40,958	)		(38,159	)		(120,587	)
Due to related parties		293,384			37,474			102,350			(15,657	)
		(5,572,225	)		(333,014	)		(296,256	)		(632,663	)
Cash flows used in investing activities
Mineral interest acquisition costs		(66,417	)		-			-			-
Disposal (purchase) of marketable securities		(99,249	)		75,719			75,032			-
Purchase of property and equipment		(35,994	)		-			-			-
		(201,660	)		75,719			75,032			-
Cash flows from financing activities
Advances from related parties		16,238			-			-			-
Debt issue costs		(205,242	)		-			-			-
Proceeds from convertible debt		2,226,251			-			-			-
Repayment of debt		(153,400	)		-			-			-
Proceeds from issuance of common shares		3,921,971			267,810			207,512			713,842
Share subscriptions received		52,277			-			-			(40,062	)
Share issue costs		(93,134	)		(8,487	)		-			(35,459	)
		5,764,961			259,323			207,512			638,321
Increase (decrease) in cash and cash equivalents		(8,924	)		2,028			(13,712	)		5,658
Cash and cash equivalents, beginning of period		11,134			182			13,894			8,236
Cash and cash equivalents, end of period		2,210			2,210			182			13,894

Supplemental Disclosures with Respect to Cash Flows (Note 11)

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

F-4

Linux Gold Corp.

(An Exploration Stage Company)

Consolidated Statements of Changes in Stockholders’ Equity (Deficit)

(Expressed in Canadian Dollars)

(with the period from March 1, 2003 to February 28, 2008 unaudited)

	Shares of common stock issued		Common stock and paid-in capital			Subscriptions received, net			Donated capital		Deficit accumulate from prior operations			Deficit accumulate during the exploration stage			Accumulated other comprehensive income (loss)			Total stockholders’ equity (deficit)
			$			$			$		$			$			$			$
Balance from prior operations at 1 March 2003		57,458,413		6,804,412			-			205,500		(7,524,145	)		-			-			(514,233	)
Common stock issued for mineral property		175,000		17,500			-			-		-			-			-			17,500
Common stock issued for services		1,000,000		100,000			-			-		-			-			-			100,000
Common stock issued for settlement of rent obligation		200,000		19,200			-			-		-			-			-			19,200
Options exercised		150,000		19,812			-			-		-			-			-			19,812
Warrants exercised		1,300,000		280,922			-			-		-			-			-			280,922
Imputed interest		-		-			-			22,960		-			-			-			22,960
Marketable securities adjustment		-		-			-			-		-			-			44,000			44,000
Net loss for the year		-		-			-			-		-			(3,738	)		-			(3,738	)
Balance at 29 February 2004		60,283,413		7,241,846			-			228,460		(7,524,145	)		(3,738	)		44,000			(13,577	)
Common stock issued for mineral property		125,000		45,384			-			-		-			-			-			45,384
Common stock issued for cash		4,205,610		860,089			-			-		-			-			-			860,089
Options exercised		87,500		10,606			-			-		-			-			-			10,606
Warrants exercised		250,000		37,500			-			-		-			-			-			37,500
Imputed interest		-		-			-			35,013		-			-			-			35,013
Stock-based compensation		-		82,000			-			-		-			-			-			82,000
Marketable securities adjustment		-		-			-			-		-			-			(54,000	)		(54,000	)
Net loss for the year		-		-			-			-		-			(748,369	)		-			(748,369	)
Balance at 29 February 2005		64,951,523		8,277,425			-			263,473		(7,524,145	)		(752,107	)		(10,000	)		254,646
Common stock issued for mineral property		50,000		20,500			-			-		-			-			-			20,500
Common stock issued for cash		3,100,000		715,127			-			-		-			-			-			715,127
Options exercised		93,750		10,838			-			-		-			-			-			10,838
Warrants exercised		92,500		21,825			-			-		-			-			-			21,825
Share issue costs		-		(42,571	)		-			-		-			-			-			(42,571	)
Imputed interest		-		-			-			31,722		-			-			-			31,722
Stock-based compensation		-		2,280			-			-		-			-			-			2,280
Marketable securities adjustment		-		-			-			-		-			-			2,000			2,000
Net loss for the year		-		-			-			-		-			(810,105	)		-			(810,105	)
Balance at 28 February 2006		68,287,773		9,005,424			-			295,195		(7,524,145	)		(1,562,212	)		(8,000	)		206,262
Subscriptions received		-		-			52,277			-		-			-			-			52,277
Common stock issued for debt		2,586,076		644,749			-			-		-			-			-			644,749
Options exercised		323,750		75,670			-			-		-			-			-			75,670
Warrants exercised		52,500		15,329			(14,600	)		-		-			-			-			729
Share issue costs		-		(2,613	)		-			-		-			-			-			(2,613	)
Imputed interest		-		-			-			53,657		-			-			-			53,657
Intrinsic value of beneficial conversion feature of convertible debentures		-		963,670			-			-		-			-			-			963,670
Fair value of warrants issued with convertible debentures		-		1,262,580			-			-		-			-			-			1,262,580
Stock-based compensation		-		109,228			-			-		-			-			-			109,228
Marketable securities adjustment		-		-			-			-		-			-			(130,000	)		(130,000	)
Net loss for the year		-		-			-			-		-			(3,571,183	)		-			(3,571,183	)
Balance at 28 February 2007		71,250,099		12,074,037			37,677			348,852		(7,524,145	)		(5,133,395	)		(138,000	)		(334,974	)
Subscriptions received		-		-			40,062			-		-			-			-			40,062
Common stock issued for debt redemption		8,378,226		1,493,911			-			-		-			-			-			1,493,911
Common stock issued for cash		2,825,000		615,195			(52,277	)		-		-			-			-			562,918
Options exercised		212,500		24,020			-			-		-			-			-			24,020
Warrants exercised		430,000		94,501			14,600			-		-			-			-			109,101
Share issue costs		-		(4,003	)		-			-		-			-			-			(4,003	)
Imputed interest		-		-			-			8,966		-			-			-			8,966
Stock-based compensation		-		75,042			-			-		-			-			-			75,042
Marketable securities adjustment		-		-			-			-		-			-			78,000			78,000
Net loss for the year		-		-			-			-		-			(2,260,291	)		-			(2,260,291	)
Balance at 29 February 2008		83,095,825		14,372,703			40,062			357,818		(7,524,145	)		(7,393,686	)		(60,000	)		(207,248	)

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

F-5

Linux Gold Corp.

(An Exploration Stage Company)

Consolidated Statements of Changes in Stockholders’ Equity (Deficit), continued

(Expressed in Canadian Dollars)

(with the period from March 1, 2003 to February 28, 2008 unaudited)

	Shares of common stock issued		Common stock and paid-in capital			Subscriptions received, net			Donated capital		Deficit accumulate from prior operations			Deficit accumulate during the exploration stage			Accumulated other comprehensive income (loss)			Total stockholders’ equity (deficit)
			$			$			$		$			$			$			$
Balance at 29 February 2008		83,095,825		14,372,703			40,062			357,818		(7,524,145	)		(7,393,686	)		(60,000	)		(207,248	)
Common stock issued for cash		4,555,000		507,867			(40,062	)		-		-			-			-			467,805
Fair value of warrants issued with common shares		-		205,975			-			-		-			-			-			205,975
Share issue costs		-		(35,459	)		-			-		-			-			-			(35,459	)
Imputed interest		-		-			-			26,143		-			-			-			26,143
Unrealized holding loss on available-for-sale investment		-		-			-			-		-			-			(208,000	)		(208,000	)
Net loss for the year		-		-			-			-		-			(536,201	)		-			(536,201	)
Balance at 28 February 2009		87,650,825		15,051,086			-			383,961		(7,524,145	)		(7,929,887	)		(268,000	)		(286,985	)
Cumulative effect related to the adoption of ASC 815-40 (Note 15)		-		(1,568,889	)		-			-		-			1,024,134			-			(544,755	)
Common stock issued for cash		5,000,000		85,277			-			-		-			-			-			85,277
Fair value of warrants issued with common shares		-		122,235			-			-		-			-			-			122,235
Transfer derivative liabilities for warrants issued and extended in the year		-		(283,191	)		-			-		-			-			-			(283,191	)
Imputed interest		-		-			-			39,069		-			-			-			39,069
Stock-based compensation		-		790			-			-		-			-			-			790
Realized loss reallocated on disposal of investments		-		-			-			-		-			-			60,403			60,403
Marketable securities adjustment		-		-			-			-		-			-			130,910			130,910
Net loss for the year (Restated – Note 15)		-		-			-			-		-			(65,985	)		-			(65,985	)
Balance at 28 February 2010 (Restated – Note 15)		92,650,825		13,407,308			-			423,030		(7,524,145	)		(6,971,738	)		(76,687	)		(742,232	)
Common stock issued for cash		5,243,000		165,828			-			-		-			-			-			165,828
Fair value of warrants issued with common shares		-		93,495			-			-		-			-			-			93,495
Transfer derivative liabilities for warrants issued in the year		-		(93,495	)		-			-		-			-			-			(93,495	)
Imputed interest		-		-			-			55,536		-			-			-			55,536
Stock-based compensation		-		505			-			-		-			-			-			505
Realized loss reallocated on disposal of investments		-		-			-			-		-			-			30,900			30,900
Marketable securities adjustment		-		-			-			-		-			-			45,787			45,787
Net loss for the period		-		-			-			-		-			(36,594	)		-			(36,594	)
Balance at 28 February 2011		97,893,825		13,573,641			-			478,566		(7,524,145	)		(7,008,332	)		-			(480,270	)

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

F-6

Linux Gold Corp.

(An Exploration Stage Company)

Notes to Consolidated Financial Statements

(Expressed in Canadian Dollars)

For the Years Ended February 28, 2011 and 2010

1. Nature and Continuance of Operations

Linux Gold Corp. (the “Company”) was incorporated on 27 February 1979 in Canada under the British Columbia Company Act and was extra-provincially registered in the Province of Alberta on 12 October 1995. The Company’s stock trades on the Over the Counter Bulletin Board in the United States under the symbol “LNXGF”.

On 20 February 2003, the shareholders approved a change of name to Linux Gold Corp. and increased the authorized share capital to 200,000,000 common shares without par value. The Company had been previously pursuing various business opportunities and, effective 1 March 2003, the Company changed its principal operations to mineral exploration. Accordingly, as of 1 March 2003, the Company is considered to be an exploration stage company.

The Company’s consolidated financial statements as at 28 February 2011 and for the year then ended have been prepared on a going concern basis, which contemplates the realization of assets and the settlement of liabilities and commitments in the normal course of business. The Company has a loss of $36,594 for the year ended 28 February 2011 (28 February 2010 – $65,985) and has a working capital deficit of $485,596 at 28 February 2011 (28 February 2010 – $273,760).

Management cannot provide assurance that the Company will ultimately achieve profitable operations or become cash flow positive, or raise additional debt and/or equity capital. Management believes that the Company’s capital resources should be adequate to continue operating and maintaining its business strategy. However, if the Company is unable to raise additional capital in the near future, due to the Company’s liquidity problems, management expects that the Company will need to curtail operations, liquidate assets, seek additional capital on less favorable terms and/or pursue other remedial measures. These consolidated financial statements do not include any adjustments related to the recoverability and classification of assets or the amounts and classification of liabilities that might be necessary should the Company be unable to continue as a going concern.

At 28 February 2011, the Company has suffered losses from exploration stage activities to date. Although management is currently seeking additional sources of equity or debt financing, there is no assurance these activities will be successful. These factors raise substantial doubt about the ability of the Company to continue as a going concern. The consolidated financial statements do not include any adjustments that might result from the outcome of this uncertainty.

2. Significant Accounting Policies

Basis of accounting

These consolidated financial statements are prepared in conformity with accounting principles generally accepted in the United States (“GAAP”) and are presented in Canadian dollars. The accompanying financial statements have been prepared in accordance with the FASB ASC 915 "Development-Stage Entities". A development-stage enterprise is one in which planned principle operations have not commenced or if its operations have commenced, there has been no significant revenue there from. Development-stage companies report cumulative loss from the inception of its development stage activities.

F-7

Linux Gold Corp.

(An Exploration Stage Company)

Notes to Consolidated Financial Statements

(Expressed in Canadian Dollars)

For the Years Ended February 28, 2011 and 2010

2. Significant Accounting Policies (continued)

Principles of consolidation

These consolidated financial statements include the accounts of the Company and its inactive wholly-owned subsidiary LinuxWizardry Inc., a United States corporation. All significant inter-company balances and transactions have been eliminated.

Foreign currency translation

The Company’s functional and reporting currency is the Canadian dollar. The consolidated financial statements of the Company are translated to Canadian dollars in accordance with FASB ASC 830 “Foreign Currency Matters”. Foreign currency transactions are primarily undertaken in U.S. dollars. Monetary assets and liabilities denominated in U.S. dollars are translated using the exchange rate prevailing at the balance sheet date. Gains and losses arising on translation or settlement of foreign currency denominated transactions or balances are included in the determination of income. The Company has not, to the date of these consolidated financial statements, entered into derivative instruments to offset the impact of foreign currency fluctuations.

Use of estimates

The preparation of financial statements in conformity with accounting principles generally accepted in the United States necessarily requires management to make estimates and assumptions which 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 amount of revenues and expenses during the reporting period. Significant areas requiring the use of management estimates include the determination of rates for amortization, the impairment of marketable securities, fair value of imputed interest and the assumptions used in computing the fair value of stock-based compensation and warrants. Actual results could differ from those estimates.

Basic and diluted net loss per share

The Company computes net loss per share in accordance with FASB ASC 260, “Earnings per Share”, which requires presentation of both basic and diluted earnings per share (“EPS”) on the face of the income statement. Basic EPS is computed by dividing net loss available to common shareholders (numerator) by the weighted average number of shares outstanding (denominator) during the period. Diluted EPS gives effect to all potentially dilutive common shares outstanding during the period using the treasury stock method and convertible preferred stock using the if-converted method. In computing diluted EPS, the average stock price for the period is used in determining the number of shares assumed to be purchased from the exercise of stock options or warrants. Diluted EPS excludes all potentially dilutive shares if their effect is anti-dilutive.

F-8

Linux Gold Corp.

(An Exploration Stage Company)

Notes to Consolidated Financial Statements

(Expressed in Canadian Dollars)

For the Years Ended February 28, 2011 and 2010

2. Significant Accounting Policies (continued)

Stock-based compensation

The Company records stock-based compensation in accordance with FASB ASC 718 “Compensation – Stock Compensation” which establishes accounting for stock-based payment transactions for employee services and goods and services received from non-employees.

The Company uses the fair-value based method to account for all stock-based payments to employees and non-employees granted by measuring the compensation cost of the stock-based payments using the Black-Scholes option-pricing model. Stock options which vest immediately are recorded at the date of grant. Stock options that vest over time are recorded over the vesting period using the straight line method. Stock options issued to outside consultants that vest over time are valued at the grant date and subsequently re-valued on each vesting date. The fair value of the stock-based compensation is recorded as a charge to net earnings based on the vesting period with a credit to contributed surplus. Upon exercise of the stock options, consideration paid by the option holder, together with the amount previously recognized in contributed surplus, is recorded as an increase to share capital. In calculating compensation to be recognized for employees, it is required to estimate forfeitures while, in general, estimated forfeitures for non-employees equal to the entire term of options.

Cash and cash equivalents

The Company considers all highly liquid investments with a maturity of three months or less at the time of issuance to be cash equivalents.

Marketable securities

The Company reports investments in debt and marketable equity securities at fair value based on quoted market prices or, if quoted prices are not available, discounted expected cash flows using market rates commensurate with credit quality and maturity of the investment. All investment securities are designated as available-for-sale with unrealized gains and losses included in stockholders’ equity. Unrealized losses that are other than temporary are recognized in earnings. Realized gains and losses are accounted for on the specific identification method.

Mineral exploration expenditures

The Company is primarily engaged in the acquisition, exploration and development of mineral properties.

Mineral property acquisition costs are capitalized when management has determined that probable future benefits consisting of a contribution to future cash inflows have been identified and adequate financial resources are available or are expected to be available as required to meet the terms of property acquisition and budgeted exploration and development expenditures. Mineral property acquisition costs are expensed as incurred if the criteria for capitalization are not met. In the event that mineral property acquisition costs are paid with Company shares, those shares are recorded at the estimated fair value at the time the shares are due in accordance with the terms of the property agreements.

F-9

Linux Gold Corp.

(An Exploration Stage Company)

Notes to Consolidated Financial Statements

(Expressed in Canadian Dollars)

For the Years Ended February 28, 2011 and 2010

2. Significant Accounting Policies (continued)

Mineral exploration expenditures (continued)

Mineral property exploration costs are expensed as incurred.

When it has been determined that a mineral property can be economically developed as a result of establishing proven and probable reserves and pre feasibility, the costs incurred to develop such property are capitalized.

Estimated future removal and site restoration costs, when determinable are provided over the life of proven reserves on a units-of-production basis. Costs, which include production equipment removal and environmental remediation, are estimated each period by management based on current regulations, actual expenses incurred, and technology and industry standards. Any charge is included in exploration expense or the provision for depletion and depreciation during the period and the actual restoration expenditures are charged to the accumulated provision amounts as incurred.

As of the date of these consolidated financial statements, the Company has incurred only exploration costs which have been expensed.

To date the Company has not established any proven or probable reserves on its mineral properties.

Asset retirement obligation

The basis of this policy is the recognition of a legal liability for obligations related to the retirement of property, plant and equipment and obligations arising from the acquisition, construction, development or normal operations of those assets. Such asset retirement costs must be recognized at fair value when a reasonable estimate of fair value can be estimated, and accretion expense is recognized over time as the discounted fair value is accreted to the expected settlement value. A corresponding increase to the carrying amount of the related asset, when one is identifiable, is recorded and amortized over the life of the asset. Where a related future value is not easily identifiable with a liability, the change in fair value over the course of the year is expensed. The amount of the liability is subject to re-measurement at each reporting period. The estimates are based principally on legal and regulatory requirements.

It is possible that the Company’s estimates of its ultimate reclamation and closure liabilities could change as a result of changes in regulations, changes in the extent of environmental remediation required, changes in the means of reclamation, or changes in cost estimates. Changes in estimates are accounting for prospectively commencing in the period the estimate is revised. To date, the Company has not recognized any asset retirement obligations as a reasonable estimate cannot be made at this time.

Long-lived assets

Long-lived assets, including property and equipment and the carrying value of intangible assets are reviewed on a regular basis for the existence of facts or circumstances that may suggest impairment. The Company recognizes impairment when the sum of the expected undiscounted future cash flows is less than the carrying amount of the asset. Impairment losses, if any, are measured as the excess of the carrying amount of the asset over its estimated fair value.

F-10

Linux Gold Corp.

(An Exploration Stage Company)

Notes to Consolidated Financial Statements

(Expressed in Canadian Dollars)

For the Years Ended February 28, 2011 and 2010

2. Significant Accounting Policies (continued)

Property and equipment

Property and equipment consists of office furniture and vehicle, which are recorded at cost. Office furniture is amortized on a declining-balance basis at 20% per annum and the vehicle is amortized on a declining-balance basis at 30% per annum.

Financial instruments

Fair Value

The carrying values of the Company’s financial instruments, consisting of cash and cash equivalents, marketable securities, amounts due to related parties and accounts payable approximate their fair values because of the short-term maturity of these financial instruments.

Interest Rate Risk

The Company is not exposed to significant interest rate risk due to the short-term maturity of its monetary assets and liabilities.

Credit Risk

The Company’s financial asset that is exposed to credit risk consists primarily of cash. To manage the risk, cash is placed with major financial institutions.

Currency Risk

The Company’s functional and reporting currency is the Canadian dollar. Monetary assets and liabilities denominated in foreign currencies are translated using the exchange rate prevailing at the balance sheet date. Gains and losses arising on translation or settlement of foreign currency denominated transactions or balances are included in the determination of income. Foreign currency transactions are primarily undertaken in U.S. dollars. The Company has not, to the date of these consolidated financial statements, entered into derivative instruments to offset the impact of foreign currency fluctuations.

Fair value measurement

The Company adopted FASB ASC 820-10-50, “Fair Value Measurements”. This guidance defines fair value, establishes a three-level valuation hierarchy for disclosures of fair value measurement and enhances disclosure requirements for fair value measures. The three levels are defined as follows:

- Level 1 inputs to the valuation methodology are quoted prices (unadjusted) for identical assets or liabilities in active markets.

- Level 2 inputs to the valuation methodology include quoted prices for similar assets and liabilities in active markets, and inputs that are observable for the assets or liability, either directly or indirectly, for substantially the full term of the financial instrument.

- Level 3 inputs to valuation methodology are unobservable and significant to the fair measurement.

All of the Company’s financial instruments measured at fair value are applied using Level 1 inputs.

F-11

Linux Gold Corp.

(An Exploration Stage Company)

Notes to Consolidated Financial Statements

(Expressed in Canadian Dollars)

For the Years Ended February 28, 2011 and 2010

2. Significant Accounting Policies (continued)

Income taxes

The Financial Accounting Standards Board (FASB) has issued FASB ASC 740-10. FASB ASC 740-10 clarifies the accounting for uncertainty in income taxes recognized in an enterprise’s financial statements in accordance with prior literature FASB Statement No. 109, Accounting for Income Taxes. This standard requires a company to determine whether it is more likely than not that a tax position will be sustained upon examination based upon the technical merits of the position. If the more likely than not threshold is met, a company must measure the tax position to determine the amount to recognize in the financial statements. As a result of the implementation of this standard, the Company performed a review of its material tax positions in accordance with recognition and measurement standards established by FASB ASC 740-10.

Deferred taxes are provided on a liability method whereby deferred tax assets are recognized for deductible temporary differences and operating loss and tax credit carry-forwards and deferred tax liabilities are recognized for taxable temporary differences. Temporary differences are the differences between the reported amounts of assets and liabilities and their tax basis. Deferred tax assets are reduced by a valuation allowance when, in the opinion of management, it is more likely than not that some portion or all of the deferred tax assets will not be realized. Deferred tax assets and liabilities are adjusted for the effects of changes in tax laws and rates on the date of enactment.

Comprehensive loss

FASB ASC 220, “Comprehensive Income”, establishes standards for the reporting and display of comprehensive loss and its components in the financial statements. As at 28 February 2011 and 2010, the Company’s only component of other comprehensive loss was unrealized holding gains and losses on available-for-sale securities.

Recent accounting pronouncements

In June 2009, the FASB issued FASB ASC 105, “The FASB Accounting Standards Codification and the Hierarchy of Generally Accepted Accounting Principles – a replacement of FASB Statement No. 162”. Under FASB ASC 105 the “FASB Accounting Standards Codification” (“Codification”) will become the source of authoritative US GAAP to be applied by nongovernmental entities. Rules and interpretive releases of the Securities and Exchange Commission (“SEC”) under authority of federal securities laws are also sources of authoritative GAAP for SEC registrants. The Codification became effective for financial statements issued for interim and annual periods ending after September 15, 2009. On the effective date, the Codification will supersede all then-existing non-SEC accounting and reporting standards. All other non-grandfathered non-SEC accounting literature not included in the Codification will become non-authoritative. The Company changed the Company’s references to U.S. GAAP accounting standards but did not impact the Company’s results of operations, financial position or cash flows.

F-12

Linux Gold Corp.

(An Exploration Stage Company)

Notes to Consolidated Financial Statements

(Expressed in Canadian Dollars)

For the Years Ended February 28, 2011 and 2010

2. Significant Accounting Policies (continued)

Recent accounting pronouncements (continued)

In June 2009, the Securities and Exchange Commission’s Office of the Chief Accountant and Division of Corporation Finance announced the release of Staff Accounting Bulletin (SAB) No. 112. This staff accounting bulletin amends or rescinds portions of the interpretive guidance included in the Staff Accounting Bulletin Series in order to make the relevant interpretive guidance consistent with current authoritative accounting and auditing guidance and Securities and Exchange Commission rules and regulations. Specifically, the staff is updating the Series in order to bring existing guidance into conformity with recent pronouncements by the Financial Accounting Standards Board, namely, Statement of Financial Accounting Standards No. 141 (revised 2007) (ASC Topic 805), Business Combinations, and Statement of Financial Accounting Standards No. 160 (ASC Topic 810), Non-controlling Interests in Consolidated Financial Statements. The statements in staff accounting bulletins are not rules or interpretations of the Commission, nor are they published as bearing the Commission's official approval. They represent interpretations and practices followed by the Division of Corporation Finance and the Office of the Chief Accountant in administering the disclosure requirements of the Federal securities laws.

In April 2009, an update was made to the FASB ASC 820, “Fair Value Measurements and Disclosures”, that provides additional guidance for estimating fair value when the volume and level of activity for the assets or liability have significantly decreased. This update is effective for interim and annual periods ending after June 15, 2009 with early adoption permitted for periods ending after March 15, 2009. The adoption of this guidance did not impact the Company’s results of operations, financial position or cash flows.

In April 2009, an update was made to FASB ASC 825, “Financial Instruments”, which requires a publicly traded company to include disclosures about the fair value of its financial instruments whenever it issues summarized financial information for interim reporting periods. This update is effective for interim reporting periods ending after June 15, 2009, with early adoption permitted for periods ending after March 15, 2009. The adoption of this guidance did not impact the Company’s results of operations, financial position or cash flows.

In May 2009, the FASB announced the issuance of FASB ASC 855, “Subsequent Events”, formerly referenced as SFAS No. 165, Subsequent Events. FASB ASC 855 should not result in significant changes in the subsequent events that an entity reports. Rather, FASB ASC 855 introduces the concept of financial statements being available to be issued. Financial statements are considered available to be issued when they complete in a form and format that complies with generally accepted accounting principles (GAAP) and all approvals necessary for issuance have been obtained. The Company has already adopted this policy and its full disclosure is included in Note 14.

In April 2010, the FASB issued Accounting Standards Update 2010-13, “Compensation – Stock Compensation (ASC 718)”, which addresses the classification of an employee share-based payment award with an exercise price denominated in the currency of a market in which the underlying equity security trades. The Update provides guidance on the classification of a share-based payment award as either equity or a liability. A share-based payment award that contains a condition that is not a market, performance, or service condition is required to be classified as a liability. The amendments in this Update are effective for fiscal years, and interim periods within those fiscal years, beginning on or after December 15, 2010. The Company is currently evaluating the impact of this update on the financial statements.

F-13

Linux Gold Corp.

(An Exploration Stage Company)

Notes to Consolidated Financial Statements

(Expressed in Canadian Dollars)

For the Years Ended February 28, 2011 and 2010

3. Marketable Securities

	28 February 2011				28 February 2010
	Cost		Fair value		Cost		Fair value
	$		$		$		$
601,500 (28 February 2010 – 1,007,000) common shares of Teryl Resources Corp.		160,092		102,255		268,017		191,330

During the year ended 28 February 2011 a total of 405,500 (2010 – 293,000) shares of Teryl Resources Corp. were sold for total proceeds of $75,720 (2010 - $75,032) with total cost of $107,925.

4. Property and Equipment

					Net book value
	Cost		Accumulated Amortization		28 February 2011		28 February 2010
	$		$		$		$
Office furniture		11,194		7,493		3,701		4,627
Vehicle		15,531		13,906		1,625		2,320
		26,725		21,399		5,326		6,947

During the year ended February 28, 2011, total additions to property, plant and equipment were $nil (2010 - $nil).

5. Mineral Properties

Alaska Mineral Properties

Dime Creek Property

The Company has 12 mining claims in Dime Creek, which are located near Nome in the State of Alaska.

Livengood Property

The Company has a total of 13 mining claims located in the Livengood-Tolovana Mining District, Alaska, USA, known as the Livengood Claims.

F-14

Linux Gold Corp.

(An Exploration Stage Company)

Notes to Consolidated Financial Statements

(Expressed in Canadian Dollars)

For the Years Ended February 28, 2011 and 2010

5. Mineral Properties

Fish Creek Property

The Company has a 50% joint lease interest in 30 claims located in the Fairbanks Mining Division, Alaska, USA, known as the Fish Creek Claims. During fiscal 2003, the Company optioned a 50% interest in the lease to Teryl Resources Corp. (“Teryl”), a related company (Note 8). Under the terms of the agreement, Teryl issued 200,000 common shares to the Company at a fair value of $80,000 and must expend $500,000 over three years.

The Company retained a 5% net royalty interest, until US$2,000,000 has been received, and may convert into a 25% working interest. The Company entered into an amending agreement with Teryl to extend the term of the original agreement until 7 March 2007, in which Teryl issued 100,000 common shares to the Company, and also agreed to expend a minimum of US$500,000 within two years from the date of that amending agreement. All other terms of the original agreement remain the same. Subsequently, the Company entered into a further agreement with Teryl to extend the term of the original agreement until 5 March 2012.

Trout Claims

On January 27, 2010 the Company entered into a mining agreement with the 100% owner (the “Owner”) of eleven mining claims named Trout Claims located in the Fairbanks Recording District, Alaska, for an option to execute a five year lease. In accordance with the mining agreement, upon payment of US$7,500 (paid) to the Owner the Company obtained the option to execute the five year lease. The terms of the lease option are as follows:

- Initial non-refundable payment of US$1,500 at signing of the lease agreement (paid);

- Annual work commitment of US$10,000;

- Consideration to the Owner on August 1 of each of the five years:

§ 2011: Cash payment of US$5,000

§ 2012: Cash payment of US$10,000

§ 2013: Cash payment of US$15,000 and issuance of 10,000 common shares of the Company

§ 2014: Cash payment of US$15,000 and issuance of 50,000 common shares of the Company

§ 2015: Cash payment of US$500,000 and issuance of the Company’s common shares valued at US$500,000 to a maximum of one million shares and granting of 4% Net Smelter Return to the Owner in exchange for 100% ownership in Trout Claims

Coho Claims

On January 27, 2010 the Company entered into a mining agreement with the 100% owner (the “Owner”) of ten mining claims named Coho Claims located in the Fairbanks Recording District, Alaska, for an option to execute a five year lease. In accordance with the mining agreement, upon payment of US$7,500 (paid) to the Owner the Company obtained the option to execute the five year lease. The terms of the lease option are as follows:

F-15

Linux Gold Corp.

(An Exploration Stage Company)

Notes to Consolidated Financial Statements

(Expressed in Canadian Dollars)

For the Years Ended February 28, 2011 and 2010

5. Mineral Properties (continued)

Coho Claims (continued)

- Initial non-refundable payment of US$1,500 at signing of the lease agreement (paid);

- Annual work commitment of US$10,000;

- Consideration to the Owner on August 1 of each of the five years:

§ 2011: Cash payment of US$5,000

§ 2012: Cash payment of US$10,000

§ 2013: Cash payment of US$15,000 and issuance of 10,000 common shares of the Company

§ 2014: Cash payment of US$15,000 and issuance of 50,000 common shares of the Company

§ 2015: Cash payment of US$500,000 and issuance of the Company’s common shares valued at US$500,000 to a maximum of one million shares and granting of 4% Net Smelter Return to the Owner in exchange for 100% ownership in Coho Claims

The following is a summary of mineral property expenditures related to the Alaska Mineral Properties for years ended February 28, 2011 and 2010:

	For the Year Ended February 28, 2011		For the Year Ended February 28, 2010		For the Year Ended February 28, 2009
	$		$		$
Exploration and development costs
Assaying		16,046		1,910		363
Field supplies and other		-		212		-
Geological consulting		3,041		7,837		14,121
Staking and recording fees		35,189		41,016		47,401
Transportation		-		-		-
		54,276		50,975		61,885

6. Accounts Payable

Accounts payable are non-interest bearing, unsecured and have settlement dates within one year.

7. Due to Related Parties

Amounts due to related parties are unsecured, non-interest bearing and have no fixed terms of repayment. During the year ended February 28, 2011, imputed interest at 15%, totalling $55,536 (2010 - $39,069) was charged to operations and treated as donated capital (Note 11). As at February 28, 2011, amounts due to related parties consist of advances or repayments to the President, Chief Executive Officer (“CEO”) and shareholder of the Company and/or companies controlled by the President, CEO and shareholder of the Company.

F-16

Linux Gold Corp.

(An Exploration Stage Company)

Notes to Consolidated Financial Statements

(Expressed in Canadian Dollars)

For the Years Ended February 28, 2011 and 2010

7. Due to Related Parties (continued)

	February 28, 2010		Advances (repayments)			February 28, 2011
	$		$			$
Access Information		1,106		(1,106	)		-
Imaging Technologies		1,018		(1,018	)		-
Information Highway.com		2,500		(2,500	)		-
IAS Energy, Inc.		1,700		(1,700	)		-
JGR Petroleum, Inc.		102,760		14,217			116,977
John Robertson		-		10,290			10,290
KLR Petroleum Ltd.		32,868		(10,155	)		22,713
Rainbow Networks		4,369		(4,369	)		-
Reg Technologies Inc.		1,210		(1,210	)		-
REGI U.S., Inc.		1,176		(1,176	)		-
SMR Investments Ltd.		49,450		32,000			81,450
Teryl Resources Corp.		115,333		4,201			119,534
		313,490		37,474			350,964

8. Related Party Transactions

Pursuant to a management services agreement, during the year ended February 28, 2011 the Company paid or accrued management fees of $30,000 (2010 - $30,000) to a company of which the President of the Company is a director. At February 28, 2011, the Company had an outstanding balance of $81,450 (2010 - $49,450) owed to this related party.

During the year ended February 28, 2011, the Company paid or accrued investor relations fees of $2,500 (2010 - $3,500) to a company related to the Company by way of a common director.

During the year ended February 28, 2011, the Company paid consulting fees of $15,190 (2010 - $14,362) to a company where the President of the Company is a director.

The Company had certain mineral property transactions and a joint venture agreement with related parties (Note 5).

Related party transactions incurred during the normal course of the Company’s operations and are measured at the exchange amount, which is the amount agreed between the related parties.

F-17

Linux Gold Corp.

(An Exploration Stage Company)

Notes to Consolidated Financial Statements

(Expressed in Canadian Dollars)

For the Years Ended February 28, 2011 and 2010

9. Capital Stock

Authorized

The Company’s authorized capital is 200,000,000 common shares without par value.

Issued and outstanding

The total issued and outstanding capital stock is 97,893,825 common shares without par value.

On October 19, 2009 the Company issued 5,000,000 units pursuant to a private placement at a price of US$0.04 per unit for gross proceeds of $207,512 (US$200,000). Each unit consists of one common share and one share purchase warrant. Each warrant entitles the holder to purchase one additional share of common stock at a price of US$0.075 in the first year or at a price of US$0.10 in the second year from the date of issue. The Company allocated $85,277 to the common shares and $122,235 to the share purchase warrants based on the relative fair values.

On November 9, 2010 the Company issued 2,473,000 units pursuant to a private placement at a price of US$0.05 per unit for gross proceeds of $126,377 (US$123,650). Each unit consists of one common share and one share purchase warrant, with each warrant entitling the holder to purchase one share at an exercise price of US$0.075 per share for a one year term expiring from date of closing. The Company allocated $84,480 to the common shares and $41,897 to the share purchase warrants based on the relative fair values.

On December 6, 2010 the Company issued 2,770,000 units pursuant to a private placement at a price of US$0.05 per unit for gross proceeds of $141,433 (US$138,500). Each unit consists of one common share and one share purchase warrant, with each warrant entitling the holder to purchase one share at an exercise price of US$0.075 per share for a one year term expiring from date of closing. The Company allocated $89,835 to the common shares and $51,598 to the share purchase warrants based on the relative fair values.

Warrants

On June 1, 2009, the Company extended the expiry date of 1,412,500 share purchase warrants issued on June 1, 2008 to June 1, 2010, resulting in a further $26,335 allocated to these warrants. The additional fair value of warrants was determined using the Black-Scholes warrant pricing model using the following weighted average assumptions: risk free interest rate of 1.01%, expected life of 1 year, annualized volatility of 193.40% and expected dividend of 0%.

On June 5, 2009 the Company extended the expiry date of 4,055,000 share purchase warrants issued on June 5, 2008 to June 5, 2010, resulting in a further $123,476 allocated to the value of these warrants. The additional fair value of warrants was determined using the Black-Scholes warrant pricing model using the following weighted average assumptions: risk free interest rate of 1.31%, expected life of 1 year, annualized volatility of 194.66% and expected dividend of 0%.

F-18

Linux Gold Corp.

(An Exploration Stage Company)

Notes to Consolidated Financial Statements

(Expressed in Canadian Dollars)

For the Years Ended February 28, 2011 and 2010

9. Capital Stock (continued)

Warrants (continued)

The following share purchase warrants were outstanding at February 28, 2011:

Expiry date	Exercise price		Number of warrants		Remaining contractual life
	US$				(years)
May 8, 2011*		0.20		9,275,000		0.19
June 28, 2011*		0.20		3,125,000		0.33
October 19, 2011		0.075/0.10		5,000,000		0.63
November 9, 2011		0.075		2,473,000		0.70
December 6, 2011		0.075		2,770,000		0.77
				22,643,000		0.43

* These warrants were issued with a private placement financing during May, 2006. These warrants were subject to a price adjustment clause whereby any future equity financing at a share price less than the exercise price of the warrants would result in the re-pricing of the warrants exercise price to equal the share price of the financing and additional warrants would be issued so that the aggregate exercise price of the re-priced warrants would equal the aggregate exercise price of the originally issued warrants. Subsequent to February 28, 2011, these warrants expired (Note 14).

The following is a summary of the Company’s warrant activities during the year ended February 28, 2011:

	Number of warrants			Weighted average exercise price
				US$
Outstanding and exercisable at February 28,  2010		23,367,500			0.18
Issued		5,243,000			0.075
Expired		(5,967,500	)		0.15
Outstanding and exercisable at February 28, 2011		22,643,000			0.16
Weighted average fair value of warrants issued during the year		-			0.018

The weighted average fair value of warrants issued during the year ended February 28, 2011 was $0.018 per warrant. The fair value of each warrant granted was determined using the Black-Scholes warrant pricing model using the following weighted average assumptions: risk free interest rate of 1.27%-1.31%, expected life of 1 year, annualized volatility of 149%-154% and expected dividend of 0%.

Stock Options

The Company has a stock option plan to issue up to 10% of the issued common shares to certain directors and employees. All options granted under the plan vest upon date of grant and are subject to the following exercise schedule:

F-19

Linux Gold Corp.

(An Exploration Stage Company)

Notes to Consolidated Financial Statements

(Expressed in Canadian Dollars)

For the Years Ended February 28, 2011 and 2010

9. Capital Stock (continued)

Stock Options (continued)

i) Up to 25% of the options may be exercised at any time during the term of the option (the “First Exercise”);

ii) The second 25% of the options may be exercised at any time after 90 days from the date of the First Exercise (the “Second Exercise”);

iii) The third 25% of the options may be exercised at any time after 90 days from the date of the Second Exercise (the “Third Exercise”); and

iv) The fourth and final 25% of the options may be exercised at any time after 90 days from the date of the Third Exercise.

On April 22, 2009, 75,000 stock options exercisable at a price of US$0.30 per common share expired.

On April 22, 2009, the Company granted 75,000 stock options to two consultants of the Company. The options are exercisable at a price of US$0.10 per common share for five years expiring on April 22, 2014.

On November 9, 2009, 12,500 stock options exercisable at a price of US$0.20 per common share expired.

On December 18, 2009 the Company granted 25,000 stock options to a consultant of the Company. The options are exercisable at a price of US$0.10 per common share for five years expiring on December 18, 2014.

On April 19, 2010 the Company granted to a consultant of the Company 50,000 stock options exercisable into the Company’s common shares at a price of $0.10 per share for five years expiring April 19, 2015.

During the year ended February 28, 2011, the Company recorded stock-based compensation of $505 (2010 - $791) for options granted.

The following stock options were outstanding and exercisable at February 28, 2011:

Expiry date	Exercise price		Number of options outstanding		Number of options exercisable		Remaining contractual life
	US$						(years)
August 9, 2011		0.35		1,500,000		375,000		0.44
November 2, 2011		0.25		25,000		6,250		0.67
December 8, 2011		0.25		50,000		12,500		0.77
November 7, 2012		0.31		50,000		12,500		1.69
February 21, 2013		0.10		1,525,000		381,250		1.98
April 22, 2014		0.10		75,000		18,750		3.14
December 18, 2014		0.10		25,000		6,250		3.81
April 19, 2015		0.10		50,000		12,500		4.14
				3,300,000		825,000		1.32

F-20

Linux Gold Corp.

(An Exploration Stage Company)

Notes to Consolidated Financial Statements

(Expressed in Canadian Dollars)

For the Years Ended February 28, 2011 and 2010

9. Capital Stock (continued)

Stock Options (continued)

The following is a summary of the Company’s stock option activities during the year ended February 28, 2011:

	Number of options		Weighted average exercise price
			US$
Outstanding at February 28, 2010		3,250,000		0.22
Granted		50,000		0.10
Outstanding at February 28, 2011		3,300,000		0.22
Exercisable at February 28, 2011		825,000		0.22
Weighted average fair value of stock options granted during the period				0.01

The fair value of each option granted was estimated on the date of the grant or modification using the Black-Scholes pricing model with the following assumptions:

	For the  Year ended  February 28, 2011			For the  Year ended  February 28, 2010
Risk free interest rate		3.02	%		1.63 - 2.32%
Expected life		5 years			4 – 5 years
Annualized volatility		126.59	%		78.17 – 124.38%
Expected dividends		-			-

Option pricing models require the input of highly subjective assumptions including the expected price volatility. Changes in the subjective input assumptions can materially affect the fair value estimate, and therefore the existing models do not necessarily provide a reliable single measure of the fair value of the Company’s stock options.

F-21

Linux Gold Corp.

(An Exploration Stage Company)

Notes to Consolidated Financial Statements

(Expressed in Canadian Dollars)

For the Years Ended February 28, 2011 and 2010

10. Commitments

On September 17, 2009 the Company entered into an office rent agreement for the duration of November 1, 2009 to October 31, 2010 at monthly rate of $3,355. The Company shares the office space and rent fees equally with two related parties. The agreement is renewed for one year at $3,690 per month for the duration of November 1, 2010 to October 31, 2011.

11. Supplemental Disclosures With Respect to Cash Flows

	Cumulative from inception of exploration stage on 1 March 2003 to February 28, 2011 (Unaudited)	For the year ended February 28, 2011	For the year ended February 28, 2010	For the year ended February 28, 2009
	$	$	$	$
Cash paid during the year for interest	-	-	-	-
Cash paid during the year for income taxes	-	-	-	-

During the year ended February 28, 2011, imputed interest at 15% per annum totalling $55,536 (2010 - $39,069) on amounts due to related parties was charged to operations and treated as donated capital (Note 7).

12. Income Taxes

Income tax expense differs from the amount that would result from applying the Canadian federal and provincial income tax rates to earnings before income taxes. These differences result from the following items:

	2011 $			2010 $
Loss before income taxes		(36,594	)		(65,985	)
Canadian federal and provincial income tax rates		28	%		29	%
Income tax recovery based on the above rates		(10,246	)		(19,136	)
Increase due to:
Non-deductible and deductible items		21,198			(85,788	)
Expiry of non-capital losses		86,857			7,049
Change in valuation allowance		(96,696	)		83,402
Change in statutory tax rates		(1,113	)		14,473
Income tax recovery		-			-

F-22

Linux Gold Corp.

(An Exploration Stage Company)

Notes to Consolidated Financial Statements

(Expressed in Canadian Dollars)

For the Years Ended February 28, 2011 and 2010

12. Income Taxes (continued)

The components of future income taxes are as follows:

	2011 $			2010 $
Future income tax assets
Non-capital losses		758,377			860,049
Mineral property costs		687,421			673,852
Property and equipment		3,953			3,548
Marketable securities and other		17,269			26,267
Total future income tax assets		1,467,020			1,563,716
Valuation allowance		(1,467,020	)		(1,563,716	)
Net future income tax assets		-			-

The Company has non-capital loss carry-forwards of approximately $3,033,509 that may be available for tax purposes. The loss carry-forwards are all in respect of Canadian operations and expire as follows:

	$
2015		311,763
2026		402,360
2027		1,036,715
2028		417,682
2029		472,218
2030		392,771
		3,033,509

Additionally, the Company has approximately $2,749,683 of development expenses and exploration expenditures as at February 28, 2011 which, under certain circumstances, may be utilized to reduce taxable income of future years. The Company also has approximately $35,157 of capital losses that may be carried forward and applied against future capital gains. The potential income tax benefits of these losses have been offset by a full valuation allowance.

F-23

Linux Gold Corp.

(An Exploration Stage Company)

Notes to Consolidated Financial Statements

(Expressed in Canadian Dollars)

For the Years Ended February 28, 2011 and 2010

13. Derivative Liabilities

Derivate liabilities consist of warrants that were originally issued in private placements that have exercise prices denominated in United States dollars, which differs from the Company’s functional currency (Canadian dollars) (Note 15). The fair value of these warrants as at February 28, 2011 is $138,465 (2010 - $484,358). The fair value of warrants as at February 28, 2011 was determined using the Black-Scholes warrant pricing model using the following weighted average assumptions: risk free interest rate of 1.00%-1.27% (2010 – 0.19-1.12% ), expected life of 0.19 year-0.77 year (2010 – 0.07-1.63 years), volatility of 167.66% (2010 – 131.81%) and expected dividend of 0% (2010 – 0%).

14. Subsequent Events

Stock Options Granted

On April 14, 2011 the Company granted to a consultant of the Company 400,000 stock options exercisable into the Company’s common shares at a price of US$0.10 per share for five years expiring April 14, 2016.

Warrants Expired

As of the issuance date of these consolidated financial statements, 12,400,000 warrants with exercise prices of $0.20 expired, unexercised.

The Company has evaluated subsequent events through the date of these consolidated financial statements were issued in accordance with FASB ASC 855 and all material subsequent events have been disclosed as stated above.

15. Restatement

The consolidated financial statements for the year ended February 28, 2010 have been restated to account for the accounting for warrants that were issued in connection with a previous private placement. The exercise price of these warrants is denominated in United States dollars, which differs from the Company’s functional currency (Canadian dollars) and therefore these warrants cannot be considered to be indexed to the Company’s own stock. Accordingly the fair value of the warrants must be accounted for as a derivative liability with changes in fair value recorded in the consolidated statement of operations.

The effect of the resulting adjustments on the company’s consolidated financial statements for the year ended February 28, 2010 is as follows:

F-24

Linux Gold Corp.

(An Exploration Stage Company)

Notes to Consolidated Financial Statements

(Expressed in Canadian Dollars)

For the Years Ended February 28, 2011 and 2010

15. Restatement (Continued)

	As previously reported			Adjustment			As Restated
Consolidated Balance Sheet as at February 28, 2010
Current derivative liabilities	$	-		$	8,939		$	8,939
Non-current derivative liabilities		-			475,419			475,419
Capital stock		15,259,388			(1,852,080	)		13,407,308
Deficit, accumulated during the exploration stage		(8,339,460	)		1,367,722			(6,971,738	)
Consolidated Statement of Operations and Comprehensive Loss for the year end February 28, 2010
Fair value adjustment of derivative liabilities		-			(343,588	)		(343,588	)
Net loss		(409,573	)		343,588			(65,985	)
Loss per share		(0.01	)		0.01			(0.00	)

The fair value adjustment on derivative liabilities has no effect on the Company’s consolidated statement of cash flows for the year end February 28, 2010.

16. Amendment

The consolidated statements of operations and comprehensive loss and cash flows for the period from inception of exploration stage on March 1, 2003 through February 28, 2011, and the consolidated statements of stockholders’ equity (deficit) for the period from March 1, 2003 through February 28, 2008 with the related disclosures in the Notes have been marked as “Unaudited”.

F-25