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**Transition Agreement**

| Between: |                     |                       |
|----------|--------------------------|----------------------------|
|     |                     |                       |
|     | Gryphon Gold Corporation |                       |
|     |                     |                       |
|     |                     | (the "Company")  |
|     |                     |                       |
| And:     |                     |                       |
|     |                     |                       |
|     | Albert J. Matter         |                       |
|     |                     |                       |
|     |                     | (the "Employee") |

WHEREAS the Employee has expressed adesire to retire from the Company no later than 30 September 2007 and to resignas a Director of the Board at a date to be determined; 

AND WHEREAS the parties are desirousof effecting a successful transition for the Employee and the Company in thisregard; 

THEREFORE, the parties agree toresolve any and all issues as follows: 

1.     The Employee will be eligible to receive a financing bonus equal to one halfpercent of any financing initiated prior to September 30, 2007; 

2.     The Employee will be eligible to receive the fees in the same amount and at thesame time as paid to the other Directors of the Board during the period of timehe is a Director, with the exception that no fees are due and owing while theEmployee is either an Officer or employee of the Company; 

3.     As long as he is a Board member his stock options will continue to vest and therights of the stock grants will be maintained in accordance with the terms ofthe initial grants. In consideration of the fact that the Employee will beretiring from the Company, any stock options that are vested if or when heshould step down from the board will be maintained in accordance with the termsof the stock option plan for their full term. Any stock options that are notvested should he not be either an officer or Director of the Company will expireimmediately; 

4.     The Employee agrees to execute any additional reasonable documents requested bythe Company in relation to his role either as an employee or Director at thesame time as he executes this Agreement; 

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5.     The Employee and the Company will execute a mutual Release much as in the formattached as Appendix "A" at the same time as execution of this Agreement. Thisrelease is conditional upon the Company performing its obligations as identifiedin paragraphs 1, 2 , 3 and 7-13 in this Agreement; 

6.     In consideration of the performance of the Employee’s obligations as noted abovein paragraphs 4 and 5 of the Agreement, the Company agrees to pay the Employeeon a monthly basis the sum of C$12,500, less applicable statutory deductions,for the period October 1, 2007 to March 31st, 2009. In addition, theCompany will have the Board of Directors approve the granting of 112,500Restricted Stock Units, which will be vested and distributed to him in threegroups of 37,500 each starting on April 1, 2009, July 1, 2009 and October 1,2009. 

On January 10, 2007 the Board ofDirectors granted the Employee 75,000 Restricted Stock Units (RSU’s) that arevesting in units of 18,750 on April 1st, 2007, July 1st,2007, October 1st, 2007 and January 1st, 2008. Any ofthese RSU’s not vested by October 10, 2007 will expire on that date. 

On January 10, 2007 the Employee wasgranted 50,000 RSU’s that vest on July 10, 2008. The Company will have the Boardapprove an amendment of the scheduled vesting so that 2,778 units are vested foreach full month of service completed as a member of the Board of Directorsbeginning from January 1, 2007. Such units to be considered vested and issued tothe Employee concurrent with his ceasing to act as a Director. 

In the event of a change of controlor Gryphon’s treasury exceeding C$15.0 million the Employee may opt forimmediate pay-out and/or vesting of any remaining payments of cash or RSUs due;

7.     The Company will make a payment to the Employee equivalent to 2 1/2 weeksvacation pay, less statutory deductions based on an annual compensation of$150,000. This payment will be made on September 30, 2007; 

8.     The Company will continue paying the premium payments for the Employee’s medicalbenefits for an 18 month period from October 1, 2007 through March 31st,2009 and as long as the Employee applies within 30 days of March 31st,2009 he will be able to start on a new medical plan with the same benefitsprovider as long as Employee pays for the expense himself; 

9.     The Company will pay the employee a $6,000 office lease allowance on retirement.

10.   The Company will pay for the Employees parking for 18 months beginning October1, 2007 and he will be able to maintain the parking stall after that date for aslong as the Employee pays for the expense himself ; 

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11.    The Companywill transfer ownership of the laptop, home computer and blackberry, all ofwhich the Employee is currently using, to the Employee on September 30, 2007;

12.    The Companywill pay the Employees reasonable legal and accounting expenses related to thepreparation and advice of this agreement. 

13.    Upon thesigning of this Agreement by the Employee, the Employee acknowledges hisirrevocable agreement to the terms of this Agreement as does the Company; 

14.    ThisAgreement shall be governed by and interpreted in accordance with the laws ofBritish Columbia, and the courts of British Columbia shall have the exclusivejurisdiction over this Agreement and any claim or dispute arising under it; 

15.    The Employeeacknowledges that it was recommended to him by the Company that he obtainsindependent legal advice before executing this Agreement and that by executingthis Agreement he represents that he has had the opportunity to do so. 

Signed this 5 day of September 2007 in _______________________, BritishColumbia. 

_____________________________ Albert J. Matter 

Signed this 5 day of September 2007 in _______________________, BritishColumbia. 

_____________________________ Tony Ker 

CEO Gryphon Gold Corporation 

 **Supplement to Transition Agreement**    Between:      Gryphon Gold Corporation   (the "Company")And:      Albert J. Matter   (the "Employee")
Whereas the Employee and Company have entered into aTransition Agreement dated September 5, 2007; 

And whereas the Board of Directors has ratified and approvedthe Transition Agreement on September 6, 2007; 

Therefore the parties agree to resolve and clarify certainissues as follows: 

1.     The Employee has theunilateral right to request up to 40% of the value of the Restricted Stock Unitsthat will vest on October 1, 2007 in cash. The Employee will give instructionsto the Company 5 business days prior to the vesting date as to the per cent ofcash, in lieu of shares, the Employee desires. 
2.     TheEmployee acknowledges that he has no rights or claims under the agreement for50,000 Restricted Stock Units dated January 10, 2007. 
3.     TheEmployee acknowledges that the he has no right or claim under the 75,000Restricted Stock Unit Agreement dated January 10, 2007 for the 18,750 units thatwere scheduled to vest January 1, 2008. 
Signed this 13 day of September 2007 in Vancouver, BritishColumbia. 

Albert J. Matter 

Michael K. Longinotti CFO Gryphon Gold Corporation