Sandstorm Gold Announces Agreement to Acquire Premier Royalty

Sandstorm Gold Ltd. ("Sandstorm" or the "Company")

and Premier Royalty Inc. ("Premier Royalty") are pleased to announce that they have entered into an arrangement agreement (the "Arrangement Agreement") pursuant to which Sandstorm will acquire 100% of the outstanding common shares in the capital of Premier Royalty (the "Premier Royalty Shares"), other than the common shares of Premier Royalty currently owned by Sandstorm, by way of a plan of arrangement under section 182 of the Business Corporations Act (Ontario) (the "Arrangement"). Summary of the Arrangement Premier Royalty shareholders will receive common shares of Sandstorm (the "Sandstorm Shares") on the basis of 0.145 of a Sandstorm Share for each Premier Royalty Share held. The Arrangement values the Premier Royalty Shares at approximately C$0.89 per Premier Royalty Share, which represents a premium of 16% to the 20-day volume weighted average trading price of the Premier Royalty Shares on the Toronto Stock Exchange (the "TSX") of approximately C$0.77. Based on Sandstorm's closing share price on August 13, 2013, the total value of this transaction would be approximately C$28.3 million. In accordance with the terms of the outstanding warrants to acquire Premier Royalty Shares (each, a "Premier Royalty Warrant"), each holder of a Premier Royalty Warrant outstanding immediately prior to the effective time of the Arrangement will receive on subsequent exercise of such holder's Premier Royalty Warrant, in accordance with its terms, for the same aggregate consideration payable for such warrant, 0.145 of a Sandstorm Share. In addition, in accordance with the terms of the outstanding options to acquire Premier Royalty Shares (each, a "Premier Royalty Option"), each holder of a Premier Royalty Option outstanding immediately prior to the effective time of the Arrangement will receive on subsequent exercise of such holder's Premier Royalty Option, in accordance with its terms, for the same aggregate consideration payable for such option, 0.145 of a Sandstorm Share. The Arrangement is subject to the approval of at least two-thirds of the votes cast by Premier Royalty shareholders at a special meeting of Premier Royalty shareholders, which is expected to be held in September 2013. The Arrangement is a related party transaction for purposes of Multilateral Instrument 61-101 - Protection of Minority Security Holders in Special Transactions ("MI 61-101"). Prior to executing the Arrangement Agreement, the Board of Directors of Premier Royalty obtained a formal valuation from Paradigm Capital Inc. as required by MI 61-101. The valuation was prepared under the supervision of a special committee of the Board of Directors of Premier Royalty consisting of independent directors. The valuation will be included in the management information circular being mailed to shareholders of Premier Royalty. The approval of the disinterested shareholders of Premier Royalty will be required in order for the Arrangement to proceed, however, all shareholders of Premier Royalty will be treated on the same basis and no additional consideration or benefit is available to any shareholder of Premier Royalty. Completion of the Arrangement is also subject to the approval of the Ontario Superior Court of Justice, the TSX, the receipt of all other necessary regulatory and third party approvals, and other customary conditions. In the event that the Arrangement is not completed under certain circumstances, Premier Royalty has agreed to pay Sandstorm a termination fee equal to C$2 million. In addition, the Arrangement Agreement includes standard non-solicitation and superior proposal provisions and Premier Royalty has provided Sandstorm with certain other customary rights, including a right to match competing offers. Full details of the transaction will be included in the management information circular of Premier Royalty to be mailed to Premier Royalty shareholders in due course. A copy of the Arrangement Agreement will be filed under each of Sandstorm's and Premier Royalty's profiles on SEDAR at www.sedar.com.