Sovereign Gold Company Limited: Gossan Hill 2013 exploration program fully funded

Sydney, Australia - Sovereign Gold Company Ltd. (Sovereign Gold) (ASX:SOC) advises that its subsidiary, Gossan Hill Gold Limited (Gossan Hill) has entered into a share subscription and option agreement (Subscription Agreement) with ICP Ltd., a company listed on the Catalist board of the Singapore Exchange Securities Trading Limited, through its wholly owned subsidiary, AceA Resources Pte. Ltd (AceA).

Highlights:

- Gossan Hill secures funding for Mt Adrah Project on a standalone basis
- Sovereign Gold retains significant interest in Gossan Hill
- Sovereign Gold continues to increase shareholder value through development of its asset portfolio

Gossan Hill currently has 96,000,000 shares on issue. Gossan Hill shareholders will be asked to approve a pro-rata issue to increase this to 192,000,000 prior to completion of the Proposed Subscription.

Under the Subscription Agreement, AceA will subscribe for 40,000,000 new ordinary shares (Subscription Shares) representing 17.2% of the enlarged share capital of Gossan Hill, at a subscription price of A$0.05 (Subscription Price) for each Subscription Share (Proposed Subscription) for a total A$2,000,000.

Additionally, pursuant to the terms of the Subscription Agreement, upon completion of the Proposed Subscription, AceA will be granted 40,000,000 options (Option), entitling AceA to subscribe for an aggregate 40,000,000 new ordinary shares (Option Shares) in the capital of Gossan Hill at A$0.10 (Exercise Price) per Option Share. The Option is exercisable to the end of 3 years from completion of the Proposed Subscription. Exercise of the Options would provide an additional A$4 million of funding to Gossan Hill.

Sovereign Gold's CEO Michael Leu said, "This direct investment in Gossan Hill, will provide funds required to complete the initial 2013 multi-pipe evaluation program at Mt Adrah without Sovereign Gold having to raise further capital to fund Gossan Hill. Sovereign Gold continues to focus on further developing its asset portfolio."

Completion of the Proposed Subscription is subject to the approval of shareholders of both ICP Ltd and Gossan Hill.

The aggregate Subscription Price and Exercise Price (if the Option is exercised) will be applied towards further drilling programs, evaluation of deposits and surrounding targets with the objective of increasing the JORC resource estimate in Mt Adrah and general working capital of Gossan Hill.

Sovereign Gold currently holds 87% of Gossan Hill.

All options will have an exercise price of A$0.10 with a term of 3 years from Completion. Exercise of all the options would provide A$13.8 million of funding to Gossan Hill.

Separately, Sovereign Gold has entered into a put option agreement with AceA, whereby AceA, at any time during the one month period commencing 1 December 2013, can require Sovereign Gold to purchase from AceA the Subscription Shares and the Option at the exercise price of A$2,000,000. This is to enable AceA to complete due diligence to its satisfaction.

To view table data on the proposed subscription, please visit:
http://media.abnnewswire.net/media/en/docs/ASX-SOC-760289.pdf

About Sovereign Gold Company Limited:

Sovereign Gold Company Ltd. (ASX:SOC) is an Australian-based gold mining company that holds a prospective tenement package covering the Rocky River-Uralla Goldfield, 21km southwest of Armidale, NSW, Australia.



Contact:

Sovereign Gold Company Ltd.
Henry Kinstlinger, Investor Relations
Telephone: +61 2 9251 7177