Capital Gold Corporation is a gold production and exploration company with a growing presence in Mexico and a singular mission — to become the next mid-tier producer in Latin America.

Capital Gold owns and operates the El Chanate open pit gold mine in Sonora, Mexico, which is currently producing at an annualized rate of about 60,000 ounces. Capital Gold achieved profitability within six months of operation and is today one of the lowest cost gold producers.

On August 3, 2010, the Company acquired Nayarit Gold, Inc. and merged it into Capital Gold's wholly-owned subsidiary. Capital Gold is focused on increasing production at the El Chanate open pit operations and advancing to production the Del Norte deposit in Nayarit, Mexico.

Capital Gold also owns and leases mineral concessions in Sonora that are undergoing preliminary exploration for gold and silver mineralization.

The Company’s shares are traded on the Toronto Stock Exchange, under the symbol CGC, and the NYSE Amex, under the symbol CGC.

For the nine months ended April 30, 2010, gold sales were $42.48 million versus $32.94 million in the prior year. Net income was $8.68 million ($0.17 per share) versus net income of $7.69 million ($0.15 per share) for the nine months of fiscal 2009.

In the third quarter, gold sales were $17.53 million versus $12.40 million in the prior year, advancing 41%. Net income from operations was $2.78 million versus $2.55 million for third quarter of fiscal 2009. Cash costs were $403 per ounce of gold sold for the three months ended April 30, 2010.

In February 2009, Capital Gold announced that the Company has settled with Standard Bank PLC the remaining 58,233 ounces of gold under the original Gold Price Protection arrangements entered into in March 2006. This enabled Capital Gold to move forward as a completely unhedged producer.

In 2008, Capital Gold restuctured its loan with Standard Bank PLC and the Company anticipates paying it off by December 2011.

El Chanate Mine — Sonora, Mexico

Through its Mexican subsidiaries and affiliates, Capital Gold owns 100% of 16 mining concessions located in the Municipality of Altar, State of Sonora, Republic of Mexico. The El Chanate concessions total approximately 3,544 hectares (8,756 acres) and are located approximately 37 kilometers northeast of the town of Caborca, Sonora and nine kilometers from a paved road. It is accessible by an all-weather dirt road.

Project construction of El Chanate open pit mine began in August of 2006, and, in less than one year, the mine was producing gold. The project was completed on time and within the $18 million capital budget. In the first fiscal year, Capital Gold produced approximately 40,000 ounces of gold, with cash costs among the lowest in the industry. The Company began expansion of El Chanate in 2007 and financed all upgrades through operating cash flow. The El Chanate mine is currently producing at an annualized rate of over 60,000 ounces.

In October 2009, Capital Gold announced an updated reserve statement and mine plan showing increased reserves for its 100% owned El Chanate open pit gold mine in Sonora, Mexico. Net of depletion, proven and probable reserves were increased from 913,000 ounces to 1,504,000 ounces — a 64.7% increase. At the projected 2010 production rate of 70,000 ounces per year, recoverable ounces now provide for over a 12-year mine life.

As of September 30, 2009, the mine had produced approximately 100,000 ounces of gold.

Orion Project — Nayarit, Mexico

The Orion Project lies in the Sierra Madres Occidental, a prolific mining district in Western Mexico, and contains approximately 257,000 acres (104,000 hectares) of mining concessions.

The Project has a NI 43-101 compliant Preliminary Economic Assessment showing the potential for the mining of 1.182 million tonnes with a gold grade of 2.79 g/t and silver grade of 267.0 g/t. Geotechnical drilling of five holes is being planned for fiscal 2011, as well as a detailed topographic mapping of the project.

Saric Exploration Property — Sonora, Mexico

In April 2008, Capital Gold leased 12 mining concessions totaling 1,790 hectares located northwest of Saric, Sonora. In addition, the Company owns a claim for approximately 2,304 additional hectares adjacent to this property.

During FY 09 (July), Capital Gold began exploration of 4,100 hectares of owned and leased concessions near the town of Saric, northeast of El Chanate. The Saric Project is accessible by paved roads and has nearby electrical power.

The Company has completed a Phase I exploration program consisting of geological mapping, systematic geochemical sampling of rock and soils, geophysical surveys, trenching and 32 reverse circulation drill holes totaling 2,560 meters. The results of this exploration have justified an expanded exploration campaign which began early October 2009. The Phase II program included 23 reverse circulation drill holes varying in depth from 100 to 150 meters and totaling 2,100 meters. The goal is to potentially identify a near surface heap leach target in the northern part of the concession group. After reviewing the preliminary data with SRK Consulting of Lakewood, Colorado, Capital Gold has decided to drill an additional 18 reverse circulation holes for a total of 1,560 meters. This additional drilling will bring the total number of holes to 73.

STEPHEN M. COOPER,
Chairman of the Board of Directors.
Mr. Cooper has over 20 years experience in the mining and petroleum industries. He has a Ph.D. in Mining and a bachelor’s degree in Mining Engineering, both from Nottingham University.

COLIN P. SUTHERLAND,
President and Director
Mr. Sutherland has over 10 years of business and professional experience. Prior to joining Capital Gold Corporation, Mr. Sutherland was President and CEO of Nayarit Gold.  Mr. Sutherland was previously a Director and Chief Financial Officer of Gammon Gold Inc. and Mexgold Resources Inc. Mr. Sutherland is a Chartered Accountant and a graduate of Saint Francis Xavier University.

SCOTT HAZLITT,
Chief Operating Officer and Director.
Mr. Hazlitt was appointed Chief Operating Officer in 2010 and has been with Capital Gold Corporation since 1999. Mr. Hazlitt received a Bachelor of Science degree in Geology from Fort Lewis College in 1974 and a Master of Science degree in Economic Geology from Colorado State University in 1985.

JOHN W. CUTLER,
Director,
has over 35 years of experience in the investment management and securities industries. Mr. Cutler received a BS in Finance from the University of Virginia - McIntire School of Commerce.

CHRISTOPHER M. CHIPMAN,
Chief Financial Officer and Corporate Secretary.
Mr. Chipman has been Capital Gold's Chief Financial Officer since March 1, 2006. He received a Bachelor of Arts in Economics from Ursinus College and is a member of the American and Pennsylvania Institute of Certified Public Accountants.

2010 Third Quarter Report on Form 10-Q

Standard & Poor's Factual Stock Report, August 5, 2010

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