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May 15, 2008
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Lake Shore Gold Announces Approval of Special Resolutions at Annual and Special
Meeting
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TORONTO, ONTARIO--(Marketwire - May 15, 2008) - Lake Shore Gold Corp. (TSX:LSG) ("Lake Shore Gold" or "the Company") today announced that shareholders have voted in favour of all resolutions at its annual and special meeting held today in Toronto.
In addition to voting on regular business such as the election of directors and the appointment of auditors, shareholders today voted, by over a 90% majority of votes cast, to accept three special business resolutions, including resolutions to:
- terminate the Company's Shareholders' Rights Plan ("Rights Plan");
- approve the issuance of common shares of the Company to Hochschild Mining Holdings Ltd. ("Hochschild"), which will result in Hochschild holding a minimum of 35% of issued and outstanding shares on a non-diluted basis and a maximum of 40% on a fully-diluted basis; and,
- have the Company continued under and thereafter governed by the Canada Business Corporations Act instead of the British Columbia Business Corporations Act.
As a result of the outcome of the shareholder vote, the Company now plans to proceed with a private placement transaction with Hochschild, first announced on April 16, 2008, through which the Company will sell 32.9 million common shares to Hochschild at a price of $2.40 per share for total proceeds of approximately $79.0 million. The transaction, which is expected to be completed by the end of the month, will increase Hochschild's interest in Lake Shore Gold to 35% from the current level of 19.9%. Based on an existing agreement, a standstill arrangement is in place which limits Hochschild's shareholdings in the Company to no more than 40%, on a fully diluted basis, until November 22, 2010.
Anthony (Tony) Makuch, President and CEO of Lake Shore Gold, commented: "We very much appreciate the strong support shown by our shareholders for the Hochschild transaction, and shown by Hochshild through its additional investment in the Company and its belief in our vision to become Canada's next intermediate gold producer. With attractive assets, such as Timmins West, the Bell Creek mill and excellent exploration potential, and a well funded balance sheet, we expect to build Lake Shore Gold into a profitable, highly competitive gold company by the end of 2010."
About Lake Shore Gold
Lake Shore Gold Corp. is a mineral development and exploration company that is rapidly moving towards gold production through a portfolio which includes an existing processing facility and a number of quality mineral properties located in the Timmins gold mining district of northern Ontario and Quebec. The Company has completed a pre-feasibility study and is moving forward with an advanced exploration program at its Timmins West property, has begun refurbishing work at its 100%-owned Bell Creek mill and is continuing drilling programs at a number of other prospective properties. The Company's common shares trade on the Toronto Stock Exchange under the symbol LSG.
Forward-looking Statements
Certain statements in this press release relating to the Company's private placement transaction with Hochschild and the advancement and development of the Company's projects, are "forward-looking statements" within the meaning of securities legislation. The Company does not intend, and does not assume any obligation, to update these forward-looking statements. These forward-looking statements represent management's best judgment based on current facts and assumptions that management considers reasonable, including that demand for products develops as anticipated, that operating and capital plans will not be disrupted by issues such as mechanical failure, unavailability of parts and supplies, labour disturbances, interruption in transportation or utilities, or adverse weather conditions, and that there are no material unanticipated variations in the cost of energy or supplies. The Company makes no representation that reasonable business people in possession of the same information would reach the same conclusions.
Forward-looking statements include, but are not limited to, statements with respect to the future price of gold and other metals, the estimation of mineral resources, the realization of mineral resource estimates, the timing and amount of estimated future production, costs of production, capital expenditures, costs and timing of the development of new deposits, timing of completion of pre-feasibility studies, success of exploration and development activities, permitting time lines, currency fluctuations, requirements for additional capital, government regulation of exploration operations, environmental risks, unanticipated reclamation expenses, title disputes or claims, completion of acquisitions and their potential impact on the Company and its operations, limitations on insurance coverage and the timing and possible outcome of pending litigation. In certain cases, forward-looking statements can be identified by the use of words such as "plans", "expects" or "does not expect", "is expected", "budget", "scheduled", "estimates", "forecasts", "intends", "anticipates" or "does not anticipate", or "believes", or variations of such words and phrases or statements that certain actions, events or results "may", "could", "would", "might" or "will be taken", "occur" or "be achieved".
Forward-looking statements involve known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements of the Company to be materially different from any future results, performance or achievements expressed or implied by the forward-looking statements. Such factors include, among others, risks related to the completion and integration of acquisitions and actual effects of the acquisitions; risks related to joint venture operations; actual results of current exploration activities; actual results of current reclamation activities; conclusions of future economic evaluations; changes in project parameters as plans continue to be refined; future prices of gold and other metals; possible variations in ore resources, grade or recovery rates; failure of plant, equipment or processes to operate as anticipated; accidents, labour disputes and other risks of the mining industry; delays in obtaining governmental approvals or financing or in the completion of development or construction activities; as well as those factors discussed in the section entitled "Risk Factors" in the Company's Annual Information Form filed with Canadian provincial securities regulatory authorities. Although the Company has attempted to identify important factors that could cause actual actions, events or results to differ materially from those described in forward-looking statements, there may be other factors that cause actions, events or results not to be as anticipated, estimated or intended. There can be no assurance that forward-looking statements will prove to be accurate, as actual results and future events could differ materially from those anticipated in such statements. Accordingly, readers should not place undue reliance on forward-looking statements.
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CONTACT INFORMATION:
Lake Shore Gold
Tony Makuch
President & CEO
(416) 703-6298
Fax: (416) 703-7764
Email: info@lsgold.com
or
Lake Shore Gold
Mark Utting
Vice-President, Investor Relations
(416) 703-6298
Fax: (416) 703-7764
Email: info@lsgold.com
Website: www.lsgold.com
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INDUSTRY: Manufacturing and Production - Mining and Metals
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