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Message: Capital Gold Corporation Rejects

Timmins Proposal and Continues to Unanimously Endorse Gammon Merger


NEW YORK, Dec. 5, 2010 /PRNewswire-FirstCall/ -- Capital Gold Corporation (TSX: CGC; NYSE Amex: CGC) announced today that its Board of Directors (the "Board") has reviewed and considered the merger proposal from Timmins Gold Corp. ("Timmins"), which Timmins announced on December 3, 2010. The Board, with the assistance of the Special Committee of the Board and its advisors, considered the points raised by Timmins in such proposal and has determined that it is, in principal, the same proposal previously submitted by Timmins and does not constitute a superior proposal as that term is defined in the agreement and plan of merger with Gammon Gold ("Gammon"). Accordingly, the Board continues to unanimously recommend to its stockholders that they vote in favor of the Gammon transaction. Additional disclosure with respect to the Board's deliberations and its response to Timmins will be set forth in an amendment to the Company's Preliminary Proxy contained within Gammon's Registration Statement on Form F-4, which it expects to file with the Securities and Exchange Commission in the upcoming weeks.

About Capital Gold

Capital Gold Corporation (CGC) is a gold production and exploration company. Through its Mexican subsidiaries and affiliates, it owns 100% of the "El Chanate" gold mine located near the town of Caborca in Sonora, Mexico. On August 2, 2010, Capital Gold acquired Nayarit Gold Inc. Capital Gold is focused on optimizing the El Chanate operations and advancing the Del Norte deposit in the Orion District in the state of Nayarit, Mexico. Capital Gold also owns and leases mineral concessions near the town of Saric, also located in Sonora, that are undergoing exploration for gold and silver mineralization. Additional information about Capital Gold and the El Chanate Gold Mine is available on the Company's website,

SOURCE Capital Gold Corporation

For further information: Kelly Cody, Investor Relations Manager, Capital Gold Corporation, +1-212-344-2785, Fax: +1-212-344-4537,
[email protected]

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