Lake Shore Gold Corp.

Lake Shore Gold Corp.

March 21, 2007 08:00 ET

Lake Shore Gold Corp. Announces C$25 Million Bought Deal Financing

VANCOUVER, BRITISH COLUMBIA--(CCNMatthews - March 21, 2007) -


Lake Shore Gold Corp. (TSX:LSG) ("Lake Shore" or "the Company") has today entered into an agreement with a syndicate of underwriters led by Canaccord Capital Corporation, under which the underwriters have agreed to buy from Lake Shore 5 million units (the "Units") and 6 million flow-through common shares of the Company (the "Flow-Through Shares") at an issue price of C$2.00 per Unit and C$2.50 per Flow-Through Share for gross proceeds to the Company of C$25,000,000 (the "Offering"). Each Unit consists of one half of one common share purchase warrant (each whole common share purchase warrant, a "Warrant"). Each Warrant will entitle the holder thereof to purchase one common share at a price of C$2.50 expiring 18 months from the closing of the Offering.

Lake Shore will grant the underwriters an option to purchase additional Units and Flow Through Shares in any combination of Units and Flow-Through Shares to raise additional gross proceeds of up to 15% of the Offering exercisable within 10 days following the closing of the Offering, to cover over-allotments, if any. The Company expects to file a preliminary short form prospectus with the securities regulatory authorities to qualify the Units and Flow Through Shares for distribution.

The net proceeds of the Offering will be used for exploration and development of the Company's mineral projects and general corporate purposes. Closing is expected on or about April 16, 2007.

Any participation by insiders of Lake Shore 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.

The Offering is being made pursuant to a short form prospectus to be filed in the provinces of British Columbia, Alberta, Manitoba, Ontario and Quebec. The securities offered have not been registered under the U.S. Securities Act of 1933, as amended, and may not be offered or sold in the United States absent registration or an applicable exemption from the registration requirements. This press release shall not constitute an offer to sell or the solicitation of an offer to buy nor shall there be any sale of the securities in any State in which such offer, solicitation or sale would be unlawful.

About Lake Shore

Lake Shore is a mineral exploration company engaged in the acquisition and exploration of mineral properties with prospects for hosting gold deposits. The Company is currently active in eastern Canada and holds a number of mineral resource properties in Ontario, including the Timmins West and Vogel/Schumacher projects, either directly or through option agreements. In February 2007 Lake Shore announced its agreement to acquire the Bell Creek mine and mill complex near Timmins, Ontario from the Porcupine Joint Venture. Lake Shore is a reporting issuer in British Columbia, Alberta, Manitoba, Ontario and Quebec, and trades on the Toronto Stock Exchange under the symbol LSG.

Forward-looking Statements

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 statements.

Contact Information

  • Lake Shore Gold Corp.
    Meghan Brown
    Manager Investor Relations
    (604) 669-3533
    (604) 688-5175 (FAX)
    Lake Shore Gold Corp.
    Brian R. Booth
    (705) 525-0992
    (705) 525-7701 (FAX)