Paramount Gold and Silver Announces Common Stock Offering

OTTAWA, ONTARIO, Oct 05 (MARKET WIRE) --
PARAMOUNT GOLD AND SILVER CORP. (TSX: PZG)(NYSE Amex: PZG)(FRANKFURT:
P6G)(WKN: A0HGKQ) (the "Company" or "Paramount"), a precious metals
exploration company, is pleased to announce that it intends to offer 16
million shares of its common stock pursuant to its shelf registration
statement filed with the U.S. Securities and Exchange Commission (the
"SEC") and a shelf prospectus filed with the securities regulatory
authority in Ontario, Canada.

Paramount intends to use the net proceeds of the offering for exploration
of its San Miguel project, for newly acquired projects in the Palmarejo
mining district, for the acquisition and exploration of new precious
metals projects, if any, and for general corporate purposes.

FCMI Financial Corporation, a Toronto based corporation controlled by
Albert D. Friedberg and the Company's largest stockholder, intends to
purchase shares of common stock in the offering.

The Company intends to grant the underwriters a 30-day option to purchase
up to 2.4 million additional shares of common stock to cover
over-allotments, if any.

Dahlman Rose & Company, LLC is acting as book-running manager for the
offering and Blackmont Capital Inc. is acting as joint lead-manager for
the offering.

The offering is being made by way of a registration statement, which has
been declared effective by the SEC, and a base shelf prospectus and a
prospectus supplement, each of which has been filed with the SEC and the
securities regulatory authority for the Province of Ontario, Canada. A
copy of the preliminary prospectus supplement relating to the offering
may be obtained by accessing the SEC website at www.sec.gov, by accessing
the website maintained by the Canadian securities regulatory authorities
at www.sedar.com, or by contacting the underwriters, in the United
States, c/o Dahlman Rose & Company, LLC, Attn: Prospectus Dept., 142 West
57th Street - 18th Floor, New York, NY 10019, phone: 212-702-4521, fax:
212-920-2945, email: ecm@dahlmanrose.com, and in Canada, c/o Blackmont
Capital Inc., Attn: Equity Capital Markets, 900 - 181 Bay Street,
Toronto, Ontario, M5J 2T3, phone: 416-864-2082, fax: 416-864-9151, email:
ecm@blackmont.com.

This news release shall not constitute an offer to sell or the
solicitation of an offer to buy, nor shall there be any sale of these
securities in any state or jurisdiction in which the offer, solicitation
or sale would be unlawful prior to registration or qualification under
the securities laws of any such state or jurisdiction. The securities
being offered have not been approved or disapproved by any regulatory
authority, nor has any such authority passed upon the accuracy or
adequacy of the prospectus supplement, the base prospectus or the
Company's shelf registration statement.

Cautionary "Safe Harbor" Statement under Applicable Securities Laws

With the exception of historical matters, the matters discussed in this
press release include forward-looking statements that involve risks and
uncertainties that could cause actual results to differ materially from
projections or estimates contained herein. Such forward-looking
statements include statements regarding future sales of common stock and
the use of proceeds from such sales. Factors that could cause actual
results to differ materially from projections or estimates include, among
others, precious metals prices, economic and market conditions, as well
as other factors described in our Annual Report on Form 10-K for the
fiscal year ended June 30, 2009 and our other filings with the SEC. Most
of these factors are beyond the Company's ability to predict or control.
The Company disclaims any obligation to update any forward-looking
statement made herein, except as required by law. Readers are cautioned
not to put undue reliance on forward-looking statements.

ABOUT PARAMOUNT GOLD AND SILVER CORP.

Paramount Gold and Silver Corp. is a precious metals exploration company
listed on the Toronto Stock Exchange and the NYSE Amex under the symbol
"PZG", and on the Frankfurt Exchange under the symbol "P6G".

Paramount holds a 100% interest in the San Miguel project and has
completed 47,560 meters of diamond drilling on 213 holes and 3,743 meters
of exploration trenching at San Miguel since the summer of 2006.
Paramount has recently expanded its land holdings by acquiring a 100%
interest in the Temoris Project from Garibaldi Resources Corp., a land
package of over 54,000 hectares. Paramount's land package now includes
most of the ground surrounding the Coeur d'Alene Mines Palmarejo Mine
project, and is comprised of total claims in excess of 180,000 hectares.

Contacts:
Paramount Gold and Silver Corp.
Christopher Crupi, CEO
Larry Segerstrom, COO
Chris Theodossiou, Investor Relations.
866-481-2233 / 613-226-9881

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