Lake Shore Gold Corp.

Lake Shore Gold Corp.

March 16, 2005 08:30 ET

Lake Shore Gold Corp. Announces a $6 Million Bought Deal Financing


NEWS RELEASE TRANSMITTED BY CCNMatthews

FOR: LAKE SHORE GOLD CORP.

TSX VENTURE SYMBOL: LSG

MARCH 16, 2005 - 08:30 ET

Lake Shore Gold Corp. Announces a $6 Million Bought
Deal Financing

VANCOUVER, BRITISH COLUMBIA--(CCNMatthews - March 16, 2005) - Lake Shore
Gold Corp. (TSX VENTURE:LSG)

NOT FOR DISTRIBUTION TO U.S. NEWS WIRE SERVICES OR FOR DISSEMINATION IN
THE UNITED STATES

Lake Shore Gold Corp. announced today that it has entered into an
agreement with a syndicate of underwriters led by Haywood Securities
Inc. and including Raymond James Ltd. (the "Underwriters") under which
the Underwriters have agreed to buy from Lake Shore 5,270,000 flow
through shares at a price of $0.95 per share and 1,250,000 non-flow
through shares at a price of $0.80 per share, representing an aggregate
offering of $6,006,500. Closing is expected on or about March 31, 2005.

Net proceeds from the sale of the private placement, which is subject to
regulatory approval, will be used by Lake Shore for ongoing exploration
and development programs and general working capital, subject to flow
through funding expenditure requirements. All flow through expenditures
will be incurred in the province of Ontario.

The Underwriters will be paid a cash commission of $360,390, which is 6%
of gross proceeds from the sale of all shares, and receive 391,200
compensation options. Each compensation option will entitle the holder
to purchase one common share at a price of $0.80 within two years after
closing.

Any participation by insiders of the Company in the offering, which
participation will be subject to the approval of independent directors
of the Company, will be on the same terms as arm's length investors, and
shareholdings of insiders in the Company will increase as a result of
any such participation. The private placement may close before 21 days
following the filing of the material change report regarding this
announcement, if management determines it is necessary or desirable for
sound business reasons.

Lake Shore is exploring for gold and base metals in the Archean Superior
Province of Ontario and Quebec.

Statements in this release that are forward-looking statements are
subject to various risks and uncertainties concerning the specific
factors disclosed under the heading "Risk Factors" and elsewhere in the
Company's periodic filings with Canadian securities regulators. Such
information contained herein represents management's best judgment as of
the date hereof based on information currently available. The Company
does not assume the obligation to update any forward-looking statement.

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Contact Information

  • FOR FURTHER INFORMATION PLEASE CONTACT:
    Lake Shore Gold Corp.
    Daniel G. Innes
    President
    (604) 669-3533
    (604) 688-5175 (FAX)
    info@lsgold.com
    www.lsgold.com
    The TSX Venture Exchange does not accept responsibility for the adequacy
    or accuracy of this release.