LAKE SHORE GOLD CORP.

as Borrower and SPROTT RESOURCE LENDING PARTNERSHIP as Agent and THE SEVERAL LENDERS FROM TIME TO TIME PARTIES HERETO

THIRD CREDIT AGREEMENT MODIFICATION AGREEMENT

Dated as of August 29, 2012

Third Credit Agreement Modification Agreement

THIRD CREDIT AGREEMENT MODIFICATION AGREEMENT dated as of August 29, 2012 between Lake Shore Gold Corp., a corporation incorporated under the laws of Canada (the "Borrower"), the several lenders from time to time parties hereto as Lenders (each a "Lender" and, collectively, the "Lenders ") and Sprott Resource Lending Partnership, as administrative agent (the "Agent"). WHEREAS the Borrower, the Lenders and the Agent entered into a credit agreement dated as of June 13, 2012(the "Credit Agreement"); WHEREAS the Borrower, the Lenders and the Agent entered into a credit agreement modification agreement dated as of June 29,2012(the "Credit Agreement Modification Agreement'); WHEREAS the Borrower, the Lenders and the Agent entered into a second credit agreement modification agreement dated as of August 20, 2012 pursuant to which the Lenders agreed to make certain accommodations to permit the Borrower to proceed with the Subordinated Debenture Offering (as defined below)(the "Second Credit Agreement Modification Agreement", and together with the Credit Agreement and the Credit Agreement Modification Agreement, the "Facility Agreements"); AND WHEREAS the Borrower has requested additional accommodations of the Lenders not provided for in the Second Credit Agreement Modification Agreement, specifically to permit Material Subsidiaries of the Borrower to guarantee the obligations of the Borrower under the Subordinated Debentures and the Subordinated Debenture Indenture and to permit the payment of accrued but unpaid interest on Subordinated Debentures in cash upon the conversion of such Subordinated Debentures; NOW THEREFORE THIS AGREEMENT WITNESSES that, in consideration of the mutual covenants and agreements herein contained and for other good and valuable consideration (the receipt and sufficiency of which are hereby acknowledged), the parties hereto covenant and agree as follows: ARTICLE 1 INTERPRETATION 1.1 Defined Terms

Unless otherwise defined herein, all defined terms shall for all purposes of this Agreement, or any amendment, substitution, supplement, replacement, restatement or addition hereto, have the meanings given in the Facility Agreements. 1.2 Other Usages

References to "this Agreement', "the Agreement", "hereof', "herein", "hereto" and like references refer to this Agreement and not to any particular Article, Section or other subdivision of this Agreement. Any references herein to any agreements or documents shall mean such agreements or documents as amended, supplemented, restated or otherwise modified from time to time in accordance with the terms hereof and thereof.

Third Credit Agreement Modification Agreement

-21.3 Headings

The division of this Agreement into Articles and Sections and the insertion of headings in this Agreement are for convenience of reference only and shall not affect the construction or interpretation ofthis Agreement. 1.4 Applicable Law

This Agreement shall be governed by and construed in accordance with the laws of the Province of Ontario and the federal laws of Canada applicable therein. Any legal action or proceeding with respect to this Agreement may be brought in the courts of the Province of Ontario and, by execution and delivery of this Agreement, the parties hereby accept for themselves and in respect of their property, generally and unconditionally, the non-exclusive jurisdiction of the aforesaid courts. Each party irrevocably consents to the service of process out of any of the aforementioned courts in any such action or proceeding by the mailing of copies thereof by registered or certified mail, postage prepaid, to such party to the address prescribed by Section 12.1 of the Credit Agreement, such service to become effective five Banking Days after such mailing. Nothing herein shall limit the right of any party to serve process in any manner permitted by law or to commence legal proceedings or otherwise proceed against any other party in any other jurisdiction. 1.5 Time of the Essence Time shall in all respects be ofthe essence of this Agreement.

ARTICLE 2
CONDITIONS PRECEDENT 2.1 Conditions Precedent

Notwithstanding any other term of the Second Credit Agreement Modification Agreement, this Agreement and the Second Credit Agreement Modification Agreement are subject to and shall only become effective upon the Agent receiving the written consent of UniCredit Bank AG to the terms of this Agreement and the Second Credit Agreement Modification Agreement, in form and substance satisfactory to the Agent. Notwithstanding the preceding sentence, it is acknowledged that the Borrower will pay out and discharge all obligations owing by it under the Senior Credit Facilities and all security therefor and terminate the Senior Credit Facilities concurrently with or immediately following the issuance of the Subordinated Debentures, pursuant to a closing escrow under which the Subordinated Debentures will not be released from the closing escrow unless and until all obligations owing by the Borrower to UniCredit Bank AG under the Senior Credit Facilities have been paid in full, all security therefor discharged and tl~e Senior Credit Facilities terminated. If for any reason this does not occur, then both this Agreement and the Second Credit Agreement Modification Agreement shall be null and void and be of no force and effect as of the date hereof and thereof. 2.2 Evidence of Satisfaction of Conditions Precedent

The Borrower shall provide the Agent with evidence satisfactory to the Lender of the satisfaction of the conditions precedent set forth in Section 2.1 above, including all acknowledgements, consents, releases and discharges of UniCredit Bank AG as the Agent may require, in form and on terms

Third Credit Agreement Modification Agreement

-3acceptable to the Agent, on or before September 7, 2012 or such later date as the Agent may agree to in writing, failing which, this Agreement shall terminate and be of no force and effect. ARTICLE 3 AMENDMENTS TO DEFINITIONS 3.1 (a) Definitions The definition of"Change of Control" contained in Section 1.1 of the Credit Agreement is hereby amended by deleting that definition in its entirety and replacing it with the following: " "Change of Control" means, if after the Closing Date, (a) any Person or one or more Persons acting jointly or in concert shall(a) acquire or otherwise become possessed of beneficial ownership (whether directly or indirectly and by whatever means) of more than 20% of the voting Shares of the Borrower or all or substantially all of the assets of the Borrower, or (b) succeed in having a sufficient number of nominees elected to the board of directors of the Borrower such that such nominees, when added to any existing director remaining on the board of directors of the Borrower after such election who is a nominee of such Person, will constitute a majority of the board of directors of the Borrower; at any time, during any period of 4 consecutive calendar weeks, a number of directors of the Borrower which, in the aggregate, is equal to or greater than a majority of all of the directors of the Borrower at the beginning of such 4 calendar week period, resigns; or there shall occur a Change of Control (as that term is defined in the Subordinated Debentures or the Subordinated Debenture Indenture)."

(b)

(c)

(b)

The definition of "Distribution" contained in Section 1.1 of the Credit Agreement is hereby amended by deleting that definition in its entirety and replacing it with the following: " "Distribution" means: (a) the declaration, payment or setting aside for payment of any dividend or other distribution on or in respect of any Shares in the capital of the Borrower, other than a dividend declared, paid or set aside for payment by the Borrower which is payable in Shares of the Borrower; the redemption, retraction, purchase, retirement or other acquisition (which, for greater certainty, shall exclude the conversion of the Subordinated Debentures), in whole or in part, of any Shares in the capital of the Borrower,the Subordinated Debentures or any securities, instruments or contractual rights capable of being converted into, exchanged or exercised for Shares in the capital of the Borrower, including, without limitation, options, warrants, conversion or exchange privileges and similar rights; and

(b)

Third Credit Agreement Modification Agreement

-4(c) the payment or prepayment of interest or the repayment or prepayment of principal with respect to (i) the Subordinated Debentures or (ii) any Indebtedness ofthe Borrower which is subordinated to the Secured Obligations."

(c)

The definition of "Permitted Indebtedness" contained in Section 1.1 of the Credit Agreement is hereby amended by adding a new Subsection (k)to read as follows:

"(k) unsecured guarantees granted by any Material Subsidiary of the Borrower guaranteeing the obligations under the Subordinated Debentures and the Subordinated Debenture Indenture following the satisfaction in full of all obligations under Section 8.1(s) of the Credit Agreement in respect of such Material Subsidiary." ARTICLE 4 EVENT OF DEFAULT 4.1 (a) Event of Default Section 10.1 of the Credit Agreement is hereby amended by adding a new Subsection (s) to read as follows:

"(s) the occurrence of an Event of Default(as that term is defined in the Subordinated Debentures or the Subordinated Debenture Indenture) or any event or circumstance under which any Indebtedness is accelerated under the Subordinated Debentures or the Subordinated Debenture Indenture." 4.2 (a) Acknowledgement The Borrower has advised the Lenders that the issuance of the Subordinated Debentures by the Borrower will result in an Event of Default under the Senior Credit Facility (by virtue of the fact that the indebtedness created by the Subordinated Debentures is not Permitted Indebtedness under the Senior Credit Facility), which in turn will result in an Event of Default under the Credit Agreement. Provided that the Borrower pays out and discharges all obligations owing under the Senior Credit Facility and all security therefor concurrently with or immediately following the issuance of the Subordinated Debentures, the Lenders agree to waive the Event of Default under the Credit Agreement resulting from the issuance of the Subordinated Debentures in contravention of the terms of the Senior Credit Facility. ARTICLE 5 DISTRIBUTIONS 5.1 (a) Distributions Section 8.2(e) of the Credit Agreement, as previously amended by Section 3.1(e) of the Second Credit Agreement Modification Agreement is hereby deleted in its entirety and replaced with the following:

"(e) Distributions. The Borrower shall not make any Distributions (i) other than regularly scheduled interest payments in respect of the Subordinated Debentures, provided always that no Default or Event of Default shall have occurred and that the making of any such regularly scheduled interest payments in respect of the Subordinated Debentures would not cause or result in and could not
Third Credit Agreement Modification Agreement

-5reasonably be expected to cause or result in the occurrence of a Default or an Event of Default,(ii) other than the payment of accrued but unpaid interest on Subordinated Debentures in cash upon and in connection with the conversion of such Subordinated Debentures into common shares in the capital of the Borrower in accordance with the terms of the Subordinated Debentures and the Subordinated Debenture Indenture, (iii) other than the payment of principal and all accrued but unpaid interest, in cash or otherwise, on the Subordinated Debentures on September 30, 2017, being the stated maturity date thereof, (iv) except as permitted in Sections (i), (ii) and (iii) above, at any time before the occurrence of a Default or an Event of Default without the prior written approval of the Agent, with the consent of the Majority Lenders, which approval shall not be unreasonably withheld; or(v) at any time after the occurrence of a Default or an Event of Default." ARTICLE 6 MISCELLANEOUS 6.1 General Rule

Subject to the terms and conditions herein contained, the Facility Agreements are hereby amended to the extent necessary to give effect to the provisions of this Agreement and to incorporate the provisions of this Agreement into the Facility Agreements. 6.2 Future References to the Credit Agreement

On and after the date of this Agreement,(i) each reference in the Facility Agreements to "this Agreement ","hereunder","hereofl', or words of like import referring to the Credit Agreement, and each reference in any related document to the "Credit Agreement ", "thereunder", "thereofl', or words of like import referring to the Credit Agreement, and (ii) each reference in the other Credit Documents to the Credit Agreement, shall mean and be a reference to the Facility Agreements as amended hereby. The Facility Agreements, as amended hereby, are and shall continue to be in full force and effect and are hereby in all respects ratified and confirmed. 6.3 Enurement

This Agreement shall enure to the benefit of and shall be binding upon the parties hereto and their respective successors and permitted assigns. 6.4 Conflict

If any provision of this Agreement is inconsistent or conflicts with any provision of the Facility Agreements, the relevant provision of this Agreement shall prevail and be paramount. 6.5 Counterparts

This Agreement may be executed in one or more counterparts, each of which shall be deemed to be an original and all of which taken together shall be deemed to constitute one and the same instrument. 6.6 Entire Agreement

This Agreement amends and modifies the Facility Agreements and together with them and the agreements referred to therein and delivered pursuant thereto, constitute the entire agreement

Third Credit Agreement Modification Agreement

between the parties hereto and supersedes any prior agreements, undertakings, declarations, representations and understandings, both written and verbal, in respect of the subject matter hereof. 6.7 Amendments

This Agreement may only be amended or modified by further written instrument, executed and delivered by each of the parties hereto.

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Third Credit Agreement Modificfition Agreement

IN WITNESS WHEREOF the parties hereto have executed and delivered this Agreement on the date first written above.

LAKE SHORE GOLD CORP.

By: "Anthony Makuch" Authorized Signatory

By: "Mario Stifano" Authorized Signatory

Third Credit Agreement Modification Agreement

SPROTT RESOURCE LENDING PARTNERSHIP, by its managing partner Sprott Lending Consulting Limited Partnership, by its general partner Sprott Lending Consulting GP Inc., as Agent

By: "Peter Grosskopf" Authorized Signatory

" By: "Narinder Nags Authorized Signatory

SPROTT RESOURCE LENDING PARTNERSHIP,by its managing partner Sprott Lending Consulting Limited Partnership, by its general partner Sprott Lending Consulting GP Inc., as Lender

By: "Peter Grosskopf" Authorized Signatory

By: "Narinder Nagra" Authorized Signatory

Third Credit Agreement Modification Agreement

SAMGENPAR LTD.,as Lender

By: "Steven Rostowsky" Authorized Signatory

Third Credit Agreement Modification Agreement

EXPLORATION CAPITAL PARTNERS 2000 LIMITED PARTNERSHIP,by its general partner,Resource Capital Investment Corporation, as Lender

By: "Rick Rule" Authorized Signatory

Third Credit Agreement Modification Agreement

DUNDEE CORPORATION,as Lender

By: "Sivan Fox" Authorized Signatory

By: "Lill Mance" Authorized Signatory

Third Credit Agreement Modification Agreement

SIGNED AND DELIVERED in the presence of: "Tracy Hahn" (Signature) Tracy Hahn (Print Name) Suite 1028, 550 Burrard Street, Vancouver BC, V6C 2B5 (Address) Executive Assistant (Occupation) ) ) ) ) ) ) ) ) )

"A. Murrav Sinclair" A. MURRAY SINCLAIR

Third Credit Agreement Modification Agreement

CIDEL TRUST COMPANY,in trust for RRSP #135300(Stewart Robertson), as Lender

By: "Laura Harewood" Authorized Signatory

Third Credit Agreement Modification Agreement

LAKE SHORE GOLD CORP. as Borrower and SPROTT RESOURCE LENDING PARTNERSHIP as Agent and THE SEVERAL LENDERS FROM TIME TO TIME PARTIES HERETO

SECOND CREDIT AGREEMENT MODIFICATION AGREEMENT

Dated as of August 20,2012

Second Credit Agreement Modification Agreement

SECOND CREDIT AGREEMENT MODIFICATION AGREEMENT dated as of August 20, 2012 between Lake Shore Gold Corp., a corporation incorporated under the laws of Canada (the "Borrower"), the several lenders from time to time parties hereto as Lenders (each a "Lender" and, collectively, the "Lenders ") and Sprott Resource Lending Partnership, as administrative agent (the "Agent"). WHEREAS the Borrower, the Lenders and the Agent entered into a credit agreement dated as of June 13, 2012(the "Credit Agreement"); WHEREAS the Borrower, the Lenders and the Agent entered into a credit agreement ", modification agreement dated as of June 29, 2012 (the "Credit Agreement Modification Agreement and together with the Credit Agreement, the "Facility Agreements"); AND WHEREAS pursuant to a news release issued by the Borrower on August 17, 2012, the Borrower has publicly announced its intention to proceed with the issue of Subordinated Debentures(as defined below); AND WHEREAS the proceeds of the offering of Subordinated Debentures are to be used in part to pay out and discharge in full all indebtedness and obligations due or coming due to UniCredit Bank AG pursuant to the Senior Credit Facilities; AND WHEREAS pursuant to Section 82(fl of the Credit Agreement, the Borrower is prohibited from creating, incurring, assuming or suffering to exist any Indebtedness other than Permitted Indebtedness; AND WHEREAS pursuant to Section 8.2(e) of the Credit Agreement, the Borrower is prohibited from making any Distributions without the prior writte approval of the Agent, with the consent of the Majority Lenders; AND WHEREAS the Indebtedness to be created pursuant to the Subordinated Debentures does not constitute Permitted Indebtedness and, accordingly, the Borrower has requested that the Agent and the Lenders agree to amend the Facility Agreements to permit the Borrower to incur the Indebtedness to be created pursuant to the Subordinated Debentures; AND WHEREAS regularly scheduled payments of interest to be made by the Borrower in accordance with the terms of the Subordinated Debentures constitute Distributions and, accordingly, the Borrower has requested that the Agent and the Lenders agree to amend the Facility Agreements to permit the Borrower to make regularly scheduled payments of interest in respect of the Subordinated Debentures; AND WHEREAS the Agent and the Lenders have agreed to amend the Facility Agreements to (a) permit the Borrower to incur the Indebtedness to be created pursuant to the Subordinated Debentures and (b) permit the Borrower to make regularly scheduled payments of interest in accordance with the terms of the Subordinated Debentures on and subject to the terms of this Agreement. NOW THEREFORE THIS AGREEMENT WITNESSES that, in consideration of the mutual covenants and agreements herein contained and for other good and valuable consideration (the receipt and sufficiency of which are hereby acknowledged), the parties hereto covenant and agree as follows:

Second Credit Agreement Modification Agreement

-2ARTICLE 1 INTERPRETATION 1.1 Defined Terms

Unless otherwise defined herein, all defined terms shall for all purposes of this Agreement, or any amendment, substitution, supplement, replacement, restatement or addition hereto, have the meanings given in the Facility Agreements. 1.2 Other Usages

', "herein", "hereto" and ", "the Agreement ", "hereof References to "this Agreement like references refer to this Agreement and not to any particular Article, Section or other subdivision of this Agreement. Any references herein to any agreements or documents shall mean such agreements or documents as amended, supplemented, restated or otherwise modified from time to time in accordance with the terms hereof and thereof. 1.3 Headings

The division of this Agreement into Articles and Sections and the insertion of headings in this Agreement are for convenience of reference only and shall not affect the construction or interpretation ofthis Agreement. 1.4 Applicable Law

This Agreement shall be governed by and construed in accordance with the laws of the Province of Ontario and the federal laws of Canada applicable therein. Any legal action or proceeding with respect to this Agreement may be brought in the courts of the Province of Ontario and, by execution and delivery of this Agreement, the parties hereby accept for themselves and in respect of their property, generally and unconditionally, the non-exclusive jurisdiction of the aforesaid courts. Each party irrevocably consents to the service of process out of any of the aforementioned courts in any such action or proceeding by the mailing of copies thereof by registered or certified mail, postage prepaid, to such party to the address prescribed by Section 12.1 of the Credit Agreement, such service to become effective five Banking Days after such mailing. Nothing herein shall limit the right of any party to serve process in any manner permitted by law or to commence legal proceedings or otherwise proceed against any other party in any other jurisdiction. 1.5 Time of the Essence Time shall in all respects be ofthe essence ofthis Agreement. ARTICLE 2 CONDITIONS PRECEDENT 2.1 Conditions Precedent

Notwithstanding any other term of this Agreement, this Agreement is subject to and shall only become effective upon the satisfaction or waiver in writing by the Agent of the following conditions precedent:

Second Credit Agreement Modification Agreement

~~ (a) the payout and discharge of all liabilities and obligations under the Senior Credit Facilities; the release and discharge of all security granted in respect of the Senior Credit Facilities; the consent of UniCredit Bank AG to the terms of this Agreement; and the termination of the intercreditor agreement dated as of June 13, 2012 among the Borrower, Unicredit Bank AG and the Lender. Evidence of Satisfaction of Conditions Precedent

(b) (c) (d)

2.2

The Borrower shall provide the Agent with evidence satisfactory to the Lender of the satisfaction of the conditions precedent set forth in Section 2.1 above, including all acknowledgements, consents, releases and discharges of UniCredit Bank AG as the Agent may require, in form and on terms acceptable to the Agent, on or before September 7, 2012 or such later date as the Agent may agree to in writing, failing which, this Agreement shall terminate and be of no force and effect.

ARTICLE 3
AMENDMENTS TO DEFINITIONS 3.1 (a) Definitions Section (c) of the definition of "Distribution" contained in Section 1.1 of the Credit Agreement is hereby amended by deleting that Section (c) and replacing it with the following:

the payment or prepayment or interest or the repayment or prepayment of "(c) principal with respect to (i) the Subordinated Debentures, or (ii) any Indebtedness of the Borrower which is subordinated to the Secured Obligations." (b) The definition of "Permitted Indebtedness" contained in Section 1.1 of the Credit Agreement is hereby amended by adding a new Subsection (j)to read as follows:

" "Indebtedness in respect of the Subordinated Debentures incurred in connection with the closing of the Subordinated Debenture Offering, including the exercise of the over-allotment option, up to a maximum principal amount of CAD$103,500,000, together with interest accruing thereon at the rate of 6.25% per annum." (c) Section 1.1 of the Credit Agreement is hereby amended by deleting the definition of "Senior Credit Facilities" and replacing it with the following:

"Senior Credit Facilities" means credit facilities made available to the Borrower " pursuant to a credit agreement (the "Senior Credit Agreement') dated as of February 24, 2011 between the Borrower, the lending institutions from time to time parties thereto as lenders, and UniCredit Bank AG, as administrative agent, and any replacement thereof approved in writing by the Majority Lenders where any such replacement facility is on substantially similar terms, in either case, therein providing for a revolving term credit facility in a maximum principal amount of up to USD50,000,000." (d) Section 1.1 of the Credit Agreement is hereby amended by adding the following definitions:
Second Credit Agreement Modification Agreement

-4" "Subordinated Debenture Offering" means the offering of the Subordinated Debentures substantially in accordance with the terms set forth in the Borrower's news release dated August 17, 2012." "Subordinated Debentures" means the CAD$90,000,000 principal amount convertible " senior unsecured debentures to be issued by the Borrower at a price of $1,000 per debenture, with an interest rate of 6.25% per annum, payable semi-annually on the last day of March and September commencing on March 31, 2013, maturing on September 30, 2017, as publicly announced by the Borrower pursuant to a news release dated August 17, 2012, together with up to an additional CAD$13,500,000 principal amount convertible senior unsecured debentures to be issued by the Borrower on the same terms to cover over-allotments, if any, in connection therewith." (e) Section 8.2(e) of the Credit Agreement is hereby deleted in its entirety and replaced with the following:

"(e) Distributions. The Borrower shall not make any Distributions (i) other than regularly scheduled interest payments in respect of the Subordinated Debentures, provided always that no Default or Event of Default shall have occurred and that the making of any such regularly scheduled interest payments in respect of the Subordinated Debentures would not cause or result in and could not reasonably be expected to cause or result in the occurrence of a Default or an Event of Default,(ii) except as permitted in Section (i) above, at any time before the occurrence of a Default or an Event of Default without the prior written approval of the Agent, with the consent of the Majority Lenders, which approval shall not be unreasonably withheld; or (iii) at any time after the occurrence of a Default or an Event of Default." ARTICLE 4 EQUITY OFFERING COVENANT 4.1 Acknowledgement of Satisfaction of Equity Offering Covenant

The Lender hereby acknowledges and agrees that upon the closing and issuance of the Subordinated Debentures and the payment therefor by the subscribers thereto, the Borrower shall be deemed to have satisfied the equity offering covenant contained in Section 8.1(w) of the Credit Agreement. ARTICLE 5 FENN-GIB AND THORNE PROPERTY SECURITY 5.1 Covenant to P~-ovide Security and Title Opinion

Section 8.1(bb) of the Credit Agreement is hereby amended by deleting reference to "September 1, 2012" and replacing it with "September 15, 2012". ARTICLE 6 PRIORITY RANKING 6.1 (a) Priority Ranking Section 7.1(aa) of the Credit Agreement is hereby amended by deleting that Section in its entirety and replacing it with the following:

Second Credit Agreement Modification Agreement

-5"Priority Ranking. The payment obligations of the Borrower under the Credit Facilities rank in priority to the Subordinated Debentures and all of the Borrower's unsubordinated Indebtedness other than any such Indebtedness which is preferred by mandatory provisions of Applicable Law or outstanding under the Senior Credit Facilities." (b) Section 8.1(u) of the Credit Agreement is hereby amended by deleting that Section in its entirety and replacing it with the following:

"Priority Ranking. The Borrower shall cause its payment obligations under the Credit Facilities to rank at all times in priority to the Subordinated Debentures and all of the Borrower's unsubordinated Indebtedness other than any such Indebtedness which is preferred by mandatory provisions of Applicable Law and Indebtedness under the Senior Credit Facilities." ARTICLE 7 MISCELLANEOUS 7.1 General Rule

Subject to the terms and conditions herein contained, the Facility Agreements are hereby amended to the extent necessary to give effect to the provisions of this Agreement and to incorporate the provisions of this Agreement into the Facility Agreements. 7.2 Future References to the Credit Agreement

On and after the date of this Agreement,(i) each reference in the Facility Agreements to "this Agreement","hereunder","hereof', or words of like import referring to the Credit Agreement, and each reference in any related document to the "Credit Agreement", "thereunder", "thereof', or words of like import referring to the Credit Agreement, and (ii) each reference in the other Credit Documents to the Credit Agreement, shall mean and be a reference to the Facility Agreements as amended hereby. The Facility Agreements, as amended hereby, are and shall continue to be in full force and effect and are hereby in all respects ratified and confirmed. 7.3 Enurement

This Agreement shall enure to the benefit of and shall be binding upon the parties hereto and their respective successors and per~nitted assigns. 7.4 Conflict

If any provision of this Agreement is inconsistent or conflicts with any provision of the Facility Agreements, the relevant provision of this Agreement shall prevail and be paramount. 7.5 Counterparts

This Agreement may be executed in one or more counterparts, each of which shall be deemed to be an original and ail of which taken together shall be deemed to constitute one and the same instrument.

Second Credit Agreement Modification Agreement

7.6

entire Agreement

This Agreement amends and modifies the Facility Agreements and together with them and the agreements referred to therein and delivered pursuant thereto, constitute the entire agreement between the parties hereto and supersedes any prior agreements, undertakings, declarations, representations and understandings, both written and verbal, in respect of the subject matter hereof. 7.7 Amendments

This Agreement may only be amended or modified by further written instrument, executed and delivered by each ofthe parties hereto.

[The ieinainde~ of this page is intentionally left blink. Signatuje pages follow]

Second Credit Agreement Modification Agreement

IN WITNESS WHEREOF the parties hereto have executed and delivered this Agreement on the date first written above. LAKE SHORE GOLD CORP.

By: `Anthony Makuch" Authorized Signatory

By: "Mario Stifano" Authorized Signatory

Second Credit Agreement Modification Agreement

SPROTT RESOURCE LENDING PARTNERSHIP,by its managing partner Sprott Lending Consulting Limited Partnership, by its general partner Sprott Lending Consulting GP Inc., as Agent

By: "Jim Grosdanis" Authorized Signatory

By: "Peter Grosskopf" Authorized Signatory

SPROTT RESOURCE LENDING PARTNERSHIP,by its managing partner Sprott Lending Consulting Limited Partnership, by its general partner Sprott Lending Consulting GP Inc., as Lender

By: "Jim Grosdanis" Authorized Signatory

By: "Peter Grosskopf" Authorized Signatory

Second Credit Agreement Modification Agreement

SAMGENPAR LTD.,as Lender

By: "Steven Rostowsky" Authorized Signatory

Second Credit Agreement Modification Agreement

EXPLORATION CAPITAL PARTNERS 2000 LIMITED PARTNERSHIP,by its general partner,Resource Capital Investment Corporation, as Lender

By: "Gretchen Carter" Authorized Signatory

Second Credit Agreement Modification Agreement

DUNDEE CORPORATION,as Lender

By: "Lucie Presot"

Authorized Signatory

C "Lili Mance"

Authorized Signatory

Second Credit Agreement Modification Agreement

SIGNED AND DELIVERED in the presence of: "Tracy Hahn" (Signature) Tracy Hahn (Print Name) Suite 1028, 550 Burrard Street, Vancouver BC, V6C 2B5 (Address) Executive Assistant (Occupation) ) ) "A. Murray Sinclair" A. MURRAY SINCLAIR ) ) ) ) ) ) )

Second Credit Agreement Modification Agreement

CIDEL TRUST COMPANY,in trust for RRSP #135300(Stewart Robertson), as Lender

By: "Mohammed Patel" Authorized Signatory

By: "Bradley Gibbert" Authorized Signatory

Second Credit Agreement Modification Agreement

LAKE SHORE GOLD CORP. as Borrower and SPROTT RESOURCE LENDING PARTNERSHIP as Agent and THE SEVERAL LENDERS FROM TIME TO TIME PARTIES HERETO

CREDIT AGREEMENT MODIFICATION AGREEMENT

Dated as of June 2), 2012

Credit Agreement Modification Agreement - Execution Copy

CREDIT AGREEMENT MODIFICATION AGREEMENT dated as of June 29,2012 between Lake Shore Gold Corp., a corporation incorporated under the laws of Canada (the "Borrower"), the several lenders from time to time parties hereto as Lenders (each a "Lender" and, collectively, the "Lenders ")and Sprott Resource Lending Partnership, as administrative agent(the "Agent"). WHEREAS the Borrower, the Lenders and the Agent have entered into a credit agreement dated as of June 13, 2012(the "Credit Agreement"); AND WHEREAS pursuant to the Credit Agreement the Gold Loan Facility Availability Period ends of June 29, 2012; AND WHEREAS the Borrower has determined that additional time is required to satisfy the conditions precedent to the advance of the Gold Loan Facility as contemplated in Article 9 of the Credit Agreement; AND WHEREAS the Agent and the Lenders have agreed to extend the Gold Loan Facility Availability Period pursuant to the terms of this Agreement; NOW THEREFORE THIS AGREEMENT WITNESSES that, in consideration of the mutual covenants and agreements herein contained and for other good and valuable consideration (the receipt and sufficiency of which are hereby acknowledged), the parties hereto covenant and agree as follows: ARTICLE 1 INTERPRETATION 1.1 Defined Terms

Unless otherwise defined herein, all defined terms shall for all purposes of this Agreement, or any amendment, substitution, supplement, replacement, restatement or addition hereto, have the meanings given in the Credit Agreement. 1.2 Other Usages

', "herein", "hereto" and References to "this Agreement', "the Agreement", "hereof like references refer to this Agreement and not to any particular Article, Section or other subdivision of this Agreement. Any references herein to any agreements or documents shall mean such agreements or documents as amended, supplemented, restated or otherwise modified from time to time in accordance with the terms hereof and thereof. 1.3 Headings

The division of this Agreement into Articles and Sections and the insertion of headings in this Agreement are for convenience of reference only and shall not affect the construction or interpretation ofthis Agreement. 1.4 Applicable Law

This Agreement shall be governed by and construed in accordance with the laws of the Province of Ontario and the federal laws of Canada applicable therein. Any legal action or proceeding

Credit Agreement Modification Agreement - Execution Copy

-2with respect to this Agreement nay be brought in the courts of the Province of Ontario and, by execution and delivery of this Agreement, the parties hereby accept for themselves and in respect of their property, generally and unconditionally, the non-exclusive jurisdiction of the aforesaid courts. Each party irrevocably consents to the service of process out of any of the aforementioned courts in any such action or proceeding by the mailing of copies thereof by registered or certified mail, postage prepaid, to such party to the address prescribed by Section 12.1 of the Credit Agreement, such service to become effective five Banking Days after such mailing. Nothing herein shall limit the right of any party to serve process in any manner permitted by law or to commence legal proceedings or otherwise proceed against any other party in any other jurisdiction. 1.5 Time of the Essence Time shall in all respects be of the essence ofthis Agreement. ARTICLE 2 EXTENSION OF GOLD LOAN FACILITY AVAILABILITY PERIOD 2.1 Definition of Gold Loan Facility Availability Period

The definition of"Gold Loan Facility Availability Period" in the Credit Agreement is ". hereby amended by deleting reference to "June 29,2012" and replacing it with "July 16, 2012 2.2 (a) Termination of Credit Facilities Section 23(a)(ii) of the Credit Agreement is hereby amended by deleting reference to "June 29, 2012" and replacing it with "July 16, 2012". Section 2.3(b)(ii) of the Credit Agreement is hereby amended by deleting reference to "June 29, 2012" and replacing it with "July 16, 2012". Conditions Precedent to Initial Extension of Credit under this Agreement

(b)

2.3

Section 9.2 of the Credit Agreement is hereby amended by deleting reference in the third line to "June 29, 2012" and replacing it with "July 16, 2012". ARTICLE 3 MISCELLANEOUS 3.1 General Rule

Subject to the terms and conditions herein contained, the Credit Agreement is hereby amended to the extent necessary to give effect to the provisions of this agreement and to incorporate the provisions of this agreement into the Credit Agreement. 3.2 Future References to the Credit Agreement

On and after the date of this Agreement, (i) each reference in the Credit Agreement to "this agreement", "hereunder", "hereofl', or words of like import referring to the Credit Agreement, and each reference in any related document to the "Credit Agreement', "thereunder", "thereof', or words of like import referring to the Credit Agreement, and (ii) each reference in the other Credit Documents to the Credit Agreement, shall mean and be a reference to the Credit Agreement as amended hereby. The Credit

Credit Agreement Modification Agreement - Execution Copy

~~ Agreement, as amended hereby, is and shall continue to be in full force and effect and is hereby in all respects ratified and confirmed.

3.3

Enurement

This agreement shall enure to the benefit of and shall be binding upon the parties hereto and their respective successors and permitted assigns. 3.4 Conflict

If any provision of this agreement is inconsistent or conflicts with any provision of the Credit Agreement,the relevant provision ofthis agreement shall prevail and be paramount. 3.5 Counterparts

This Agreement may be executed in one or more counterparts, each of which shall be an original and all of which taken together shall be deemed to constitute one and the same deemed to be instrument. 3.6 Entire Agreement

This Agreement amends and modifies the Credit Agreement and together with it and the agreements referred to therein and delivered pursuant thereto, constitute the entire agreement between the parties hereto and supersedes any prior agreements, undertakings, declarations, representations and understandings, both written and verbal, in respect of the subject matter hereof. 3.7 Amendments

This Agreement may only be amended or modified by further written instrument, executed and delivered by each of the parties hereto.

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Credit Agreement Modification Agreement - Execution Copy

IN WITNESS WHEREOF the parties hereto have executed and delivered this Agreement on the date first written above. LAKE SHORE GOLD CORP.

By: `Anthony Makuch" Authorized Signatory

By: "Mario Stifano" Authorized Signatory

Credit Agreement Modification Agreement - Execution Copy

SPROTT RESOURCE LENDING PARTNERSHIP,by its managing partner Sprott Lending Consulting Limited Partnership, by its general partner Sprott Lending Consulting GP Inc., as Agent

By: "Jim Grosdanis" Authorized Signatory

By: "Peter Grosskopf" Authorized Signatory

SPROTT RESOURCE LENDING PARTNERSHIP,by its managing partner Sprott Lending Consulting Limited Partnership, by its general partner Sprott Lending Consulting GP Inc., as Lender

By: "Jim Grosdanis" Authorized Signatory

By: "Peter Grosskopf" Authorized Signatory

Credit Agreement Modification Agreement - Execution Copy

SAMGENPAIt LTU., as Lender

By: "Steven Rostowsky" Authorized Signatory

Credit Agreement Modification Agreement - Execution Copy

EXPLORATION CAPITAL PARTNERS 2000 LIMITED PARTNERSHIP,by its general partner, Resource Capital Investment Corporation, as Lender

By: "Gretchen Carter" Authorized Signatory

Credit Agreement Modification Agreement - Execution Copy

DUND~~ CORPORATION,as Lender

By: "Sivan Fox" Authorized Signatory

By: "Lucie Presot" Authorized Signatory

Credit Agreement Modification Agreement - Execution Copy

HELMSDALE BANK CORP.,as Lender

By: "Randy Barker" Authorized Signatory

Credit Agreement Modification Agreement - Execution Copy

SIGNED AND DELIVERED in the presence of: "Tracy Hahn" (Signature) Tracy Hahn (Print Name) ) `A. Murrav Sinclair" ) A. MURRAY SINCLAIR ) )

Suite 1028, 550 Burrard Street, Vancouver BC, ) V6C 2B5 ) (Address) ) Executive Assistant (Occupation) )

Credit Agreement Modification Agreement - Execution Copy

CIDEL TRUST COMPANY,in trust for RRSP #135300(Stewart Robertson), as Lender

By: "Laura Harewood " Authorized Signatory

By: "E. Adrian Meyer" Authorized Signatory

Credit Agreement Modification Agreement - Execution Copy