Gold Mountain Announces Reliance on Financial Hardship Exemption in Connection With Debt Settlements and Deferrals and Private Placement Offering Up to $750,000 - Seite 2

Insider Participation

None of the creditors currently own (directly or indirectly) any securities of the Company. Upon completion of the Debt Settlements (assuming no settlement of unsecured debts and prior to closing of the Private Placement) Hedge would own 39.38% of the Company's common shares (non-diluted) and Nhwelmen would own 39.65% of the Company's common shares (non-diluted). Assuming settlement of all $1.5 million of the unsecured debt and closing of the Private Placement of $750,000 in gross proceeds, Hedge would own 23.64%, Nhwelmen would own 23.80% and the unsecured creditors would own 28.60% the Company's common shares, all on a non-diluted basis. As a result of such ownership, Nhwelmen and Hedge will become "insiders" of the Company for purposes of the TSX Company Manual and a "related party" of the Company pursuant to Multilateral Instrument 61-101 - Protection of Minority Security Holders in Special Transactions ("MI 61-101"). Depending on the participation of the unsecured creditors, such unsecured creditors may also become "insiders" and "related parties" and the Company will make such disclosure in future press releases once determined. The Debt Settlements will result in a change of control of the Company as both Nhwelmen and Hedge will become control persons in the Company, owning more than 20% of the current issued and outstanding. The Company does not anticipate that any of subscribers pursuant to the Private Placement will become "insiders" or "related parties" of the Company.

The Debt Settlement is a "related party transaction" within the meaning of MI 61-101. However, in light of the fact that the Board and Special Committee have determined that the Company is in serious financial difficulty and that the Debt Settlement is designed to improve the Company's financial situation, the Company is relying on the exemption from the formal valuation and minority approval requirements of MI 61-101 contained in Section 5.5(g) and Section 5.7(1)(e) of MI 61-101, respectively, on the basis of the "financial hardship" exemption therein.

Special Committee

A special committee of the board of directors of the Company (the "Special Committee") was constituted and considered the fairness of the Debt Settlements and related matters. The Special Committee is comprised of two independent directors. The Special Committee has determined that the Debt Settlements are reasonable for the Company in the circumstances and recommends that the Company proceed with the Debt Settlement.