Cornerstone Capital Resources Inc.
TSX VENTURE : CGP

Cornerstone Capital Resources Inc.

June 13, 2005 18:29 ET

Cornerstone Private Placement Completed

MOUNT PEARL, NEWFOUNDLAND--(CCNMatthews - June 13, 2005) - Cornerstone Capital Resources Inc. (TSX VENTURE:CGP) confirms completion of the $2.0 million private placement announced May 2, 2005. The company is pleased to announce that the offering was fully subscribed, including the 15% over-allotment provided for in the agreement with First Associates Investments Inc., for total proceeds of $2.3 million.

Under the financing, 3,289,000 flow-through units and 3,834,100 non-flow-through units were sold. Each flow-through unit was priced at $0.35 per unit and comprised one flow-through common share and one-half share purchase warrant. Each non-flow-through unit was priced at $0.30 per unit and comprised one non-flow-through common share and whole share purchase warrant. Each whole warrant entitles the holder to acquire one additional common share at a price of $0.40 per share for a period of one year after closing of the offering, and thereafter at $0.50 per share for one additional year. The Company will have the right to accelerate the expiry date of the warrants to thirty (30) days from the date of the exercise of such acceleration right by providing holders of the warrants with written notice of such reduction in the exercise period. The right to accelerate will be triggered in the event that the closing price of the Company's common shares is $0.60 or more per share over a period of twenty (20) consecutive trading days during the first twelve months after the closing of the offering, or $0.75 or more per share over a period of twenty (20) consecutive trading days during the second twelve months.

As agent, First Associates is receiving a commission of 8% of the gross amount raised, paid from the proceeds of the offering. As additional consideration, First Associates was granted non-transferable options (the "Agent's Compensation Options") entitling First Associates to purchase 890,388 units, representating 12.5% of the number of units sold under the offering. The Agent's Compensation Options may be exercised at the offering price for a period of 12 months from closing of the offering.

All shares issued pursuant to the placement will bear a legend restricting transfer until October 14, 2005.

Participants in the private placement include senior industry letter writers, leading brokerage houses and their principals, the institutional funds NCE Diversified Flow-Through (05) Limited Partnership, managed by Sentry Select Capital Corp., and Norrep Performance 2005 Flow-Through Limited Partnership, managed by Hesperian Capital Management Ltd., and sophisticated private investors. About 50% of the investment was made by non-Canadian investors and about 25% was made by funds that are new shareholders. The balance came primarily from Western Canadian investors. Cornerstone wishes to welcome the new shareholders and to express appreciation to all shareholders for their continued trust and confidence.

The proceeds of the issuance will be used to advance existing properties, to generate and acquire new exploration properties and to provide working capital to the Corporation.

On May 26, 2005 the Company issued 605,000 options to purchase shares in Cornerstone to Insiders, Employees and Consultants. In accord with company policy, the options were priced at $0.30 each, which is the price at market close plus $0.01.

On Behalf of the Board of Directors

Glen H. McKay, President

The TSX Venture Exchange does not accept responsibility for the adequacy or accuracy of this release.

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