P2 Gold Inc. (TSX-V:PGLD) (OTCQB:PGLDF) reports that, subject to TSX Venture Exchange approval, it has restructured the outstanding payment terms for the acquisition of the Gabbs Project located on the Walker-Lane Trend in the Fairplay Mining District of Nye County, Nevada. (See the Company’s news releases dated February 23, 2021, announcing the acquisition of the Gabbs Project, and May 5, 2021 and April 28, 2022, announcing amendments to the terms of the acquisition of the Gabbs Project).

“We appreciate Waterton’s support in restructuring the payment terms for the acquisition of our Gabbs Project,” commented Joe Ovsenek, President and CEO of P2. “Under the prior terms, US$8.9 million was due this May. Now, the majority of the payments have been pushed off for over three years, giving us time to advance Gabbs to the point where we can sell a royalty or stream to fund the payments due to Waterton to complete the purchase of Gabbs.”

As part of the restructuring, P2 has entered into an amending agreement with Waterton Nevada Splitter, LLC, an affiliate of Waterton Precious Metals Fund II Cayman, LP pursuant to which P2 will now issue or pay to Waterton (a) 2,659,748 shares in the capital of the Company following Exchange approval of the Amending Agreement, (b) US$150,000 on or before December 31, 2023, (c) US$250,000 on or before December 31, 2024, (d) US$2 million on or before December 31, 2025 and (e) US$2.4 million on or before December 31, 2026. The Amending Agreement also contemplates, (x) if P2 raises, through the issuance of debt or equity, in excess of C$7.5 million (excluding flow-through funds), 10% of the funds raised will be paid to Waterton against the longest dated milestone payment and (y) on the sale of an interest in, or of, Gabbs, the proceeds will be paid to Waterton up to the amount outstanding at the time.

In addition, P2 will issue to Waterton a US$4,000,000, zero coupon convertible note with a four-year term convertible at a price of C$0.30 per share provided that the Note cannot be converted if all payments due under the Amending Agreement have been made at the time the Note is called (other than if a change of control is to occur prior to repayment of the Note). The Note can be called at any time on payment of 115% in the first year, 130% in the second year and 150% thereafter and is due on maturity, an event of default or a change of control.   Also, under the Note, approval by the shareholders of the Company is required if conversion of the Note would make Waterton a Control Person (as defined in the Exchange’s Corporate Finance Manual).

If the Exchange fails to provide approval of the Amending Agreement and the Note and the transactions contemplated thereunder in accordance with applicable rules and policies of the Exchange by March 31, 2023, the Amending Agreement and the Note shall be deemed to be null and void.

Waterton currently has beneficial ownership of, and control or direction over, 15,000,000 common shares of the Company, representing approximately 16.9% of the issued and outstanding Shares. Following the issuance of 2,659,748 Shares to Waterton under the Amending Agreement, Waterton will have beneficial ownership of, and control or direction over, 17,659,748 Shares, representing approximately 19.9% of the issued and outstanding Shares following the restructuring. An early warning report will be filed with the applicable securities commission in each jurisdiction where the Company is reporting and will be available at www.sedar.com.

About P2 Gold Inc.

P2 Gold is a mineral exploration and development company focused on advancing precious metals and copper discoveries and acquisitions in the western United States and British Columbia.