Key Gold Holding Inc. and Pangolin Diamonds Corp. Engage Paradigm Capital Inc. as Sponsor for Proposed Reverse-Take-Over

TORONTO, ONTARIO -- (Marketwire - Aug. 8, 2012) - Key Gold Holding Inc. (TSX VENTURE:KGH) (the "Company" or "Key Gold") and Pangolin Diamonds Corp. ("Pangolin") are pleased to announce that they have jointly engaged Paradigm Capital Inc. ("Paradigm") to act as sponsor in connection with the proposed transaction resulting in a reverse take-over of Key Gold by the shareholders of Pangolin (the "Proposed Transaction") previously announced on February 21, 2012.

Subject to completion of satisfactory due diligence, Paradigm has agreed to act as sponsor in connection with the Proposed Transaction in accordance with the policies of the TSX Venture Exchange ("TSXV"). An agreement to sponsor should not be construed as any assurance with respect to the merits of the Proposed Transaction or the likelihood of completion.


Satisfaction of Financing Condition

As previously announced by Key Gold and Pangolin, the completion of the Proposed Transaction is subject to a number of conditions, including the completion by Pangolin of a private placement financing (the "Offering") for minimum gross proceeds of not less than $1,000,000 at an issue price of $0.10 per Pangolin share and maximum gross proceeds of $1,500,000(the "Financing Condition").

Pangolin is pleased to announce that the Financing Condition has successfully been met in excess of the $1,000,000 minimum under the terms of the Transaction.


Submission and acceptance of the NI 43-101 Technical Report

Pangolin and Key Gold are also pleased to announce that a National Instrument 43-101 - Standards of Disclosure for Mineral Projects ("NI 43-101") technical report in relation to Pangolin's Tsabong North property located in Botswana, Africa (the "Technical Report") has been reviewed and accepted by the TSXV. The Technical Report will be filed on SEDAR when Key Gold files its circular with respect to the Proposed Transaction.


About Pangolin Diamonds Corp.

Pangolin Diamonds Corp. is building a leading diamond exploration and development company in the heart of diamond country in Botswana, Africa. Jwaneng is the richest mine in the world, and Orapa is the second largest diamond mine in the world. There are four non-De Beers mines in Botswana and the country supplies 21% of global rough diamond production.

Pangolin holds eleven prospecting licenses that cover an area of 5,307 square kilometres and consist of five project areas namely: Tsabong North, Jwaneng South, Lorolwane, Malatswae and Madinare.

Of the prospecting licenses, the Tsabong North property is the priority target. It covers an area of 1,546 square kilometres and is located 100 kilometres north of Tsabong (located in the southwestern portion of Botswana). Tsabong North property is situated on the western edge of the Archaean Kaapvaal craton, immediately north of the diamondiferous Tsabong kimberlite field. Soil sampling has produced highly anomalous concentrations of kimberlite indicators within the project area. Microprobe analyses of garnets have confirmed the presence of G10 garnets, indicative of the presence of a mantle conducive to the crystallization of diamonds. A detailed aeromagnetic survey has identified 50 targets. Soil trace element results are consistent with orientation trace element results over known kimberlites. The craton margin location of the project is similar to that of kimberlites in Lesotho known to host large, high-value Type II diamonds.

Dr. Leon Daniels, Ph.D, a director of Pangolin, is a "qualified person" under National Instrument 43-101 and has reviewed the technical disclosure regarding Pangolin in this press release.


About Key Gold Holding Inc.

Key Gold Holding Inc. is a mineral exploration company that is currently mainly focused on the acquisition, exploration and development of gold and copper properties.

Key Gold has 28,252,790 common shares outstanding and is listed on the TSXV under the symbol KGH and remains halted until such time the proposed transaction has been completed and or canceled.


Reader Advisory

This press release contains forward-looking statements with respect to the Proposed Transaction and matters concerning the business, operations, strategy, and financial performance of Pangolin and Key Gold, and the resulting merged entity should the Proposed Transaction be completed (the "Resulting Issuer"). These statements generally can be identified by use of forward looking word such as "may", "will", "expect", "estimate", "anticipate", "intends", "believe" or "continue" or the negative thereof or similar variations. The completion of the Proposed Transaction and the future business, operations and performance of the Resulting Issuer discussed herein could differ materially from those expressed or implied by such statements. Such forward-looking statements are qualified in their entirety by the inherent risks and uncertainties surrounding future expectations, including that the Proposed Transaction contemplated herein is completed. Forward-looking statements are based on a number of assumptions which may prove to be incorrect, including, but not limited to: the ability of Key Gold and Pangolin to obtain necessary shareholder approval to complete the Proposed Transaction or to satisfy the requirements of the TSXV with respect to the Proposed Transaction. The cautionary statements qualify all forward-looking statements attributable to Key Gold and Pangolin and persons acting on their behalves. Unless otherwise stated, all forward-looking statements speak only as of the date of this press release and Key Gold and Pangolin have no obligation to update such statements except as required by law.

Completion of the Proposed Transaction is subject to a number of conditions, including but not limited to, TSXV acceptance and disinterested shareholder approval. The Proposed Transaction cannot close until the required shareholder approval is obtained. There can be no assurance that the Proposed Transaction will be completed as proposed or at all.

Investors are cautioned that, except as disclosed in the management information circular prepared in connection with the Proposed Transaction, any information released or received with respect to the Proposed Transaction may not be accurate or complete and should not be relied upon. Trading in the securities of Key Gold Holding Inc. should be considered highly speculative.

The TSXV has in no way passed upon the merits of the Proposed Transaction and has neither approved nor disapproved the contents of this press release.

Neither the TSXV nor its Regulation Services Provider (as that term is defined in the policies of the TSXV) accepts responsibility for the adequacy or accuracy of this release.



Contact

Key Gold Holding Inc.
Graham Warren, C.F.O.
416.594.0473
g.warren@sympatico.ca

Pangolin Diamonds Corp.
Dr. Willem Smuts, President & CEO
+27.83.782.2346
wjsmuts@pangolindiamondscorp.com
www.pangolindiamondscorp.com