Platinum Metals : 2020 Fourth Quarter Report (772 KB)

Platinum Group Metals Ltd.

Consolidated Financial Statements

(all amounts in thousands of United States Dollars unless otherwise noted) For the year ended August 31, 2020

Filed: November 25, 2020

Report of Independent Registered Public Accounting Firm

To the Shareholders and Board of Directors of Platinum Group Metals Ltd.

Opinion on the Consolidated Financial Statements

We have audited the accompanying consolidated statements of financial position of Platinum Group Metals Ltd. and its subsidiaries (together, the Company) as of August 31, 2020 and 2019, and the related consolidated statements of loss and comprehensive loss, changes in equity and cash flows for each of the three years in the period ended August 31, 2020, including the related notes (collectively referred to as the consolidated financial statements). In our opinion, the consolidated financial statements present fairly, in all material respects, the financial position of the Company as of August 31, 2020 and 2019, and its financial performance and its cash flows for each of the three years in the period ended August 31, 2020 in conformity with International Financial Reporting Standards as issued by the International Accounting Standards Board.

Substantial Doubt About the Company's Ability to Continue as a Going Concern

The accompanying consolidated financial statements have been prepared assuming that the Company will continue as a going concern. As discussed in Note 1 to the consolidated financial statements, the Company has suffered recurring losses from operations and has a net capital deficiency, negative working capital and has significant amounts of debt payable without any current source of operating income which raise substantial doubt about its ability to continue as a going concern. Management's plans in regard to these matters are also described in Note 1. The consolidated financial statements do not include any adjustments that might result from the outcome of this uncertainty.

Basis for Opinion

These consolidated financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on the Company's consolidated financial statements based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (PCAOB) and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

We conducted our audits of these consolidated financial statements in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the consolidated financial statements are free of material misstatement, whether due to error or fraud. The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. As part of our audits we are required to obtain an understanding of internal control over financial reporting but not for the purpose of expressing an opinion on the effectiveness of the Company's internal control over financial reporting. Accordingly, we express no such opinion.

PricewaterhouseCoopers LLP

PricewaterhouseCoopers Place, 250 Howe Street, Suite 1400, Vancouver, British Columbia, Canada V6C 3S7 T: [phone], F: [phone]

"PwC" refers to PricewaterhouseCoopers LLP, an Ontario limited liability partnership.

Our audits included performing procedures to assess the risks of material misstatement of the consolidated financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the consolidated financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the consolidated financial statements. We believe that our audits provide a reasonable basis for our opinion.

/s/PricewaterhouseCoopers LLP

Chartered Professional Accountants

Vancouver, Canada

November 25, 2020

We have served as the Company's auditor since 2007.

PLATINUM GROUP METALS LTD.

Consolidated Statements of Financial Position (in thousands of United States Dollars)

		August 31,		August 31,
		2020		2019
ASSETS
Current
Cash	$	1,308	$	5,550
Amounts receivable		218		507
Prepaid expenses		385		298
Total current assets		1,911		6,355
Performance bonds and other assets		108		65
Exploration and evaluation assets (Note 4)		34,939		36,792
Right to use asset (leased corporate offices)		175		-
Property, plant and equipment		282		451
Total assets	$	37,415	$	43,663
LIABILITIES
Current
Accounts payable and other liabilities	$	1,412	$	4,022
Brokerage fees payable (Note 12)		2,890		2,775
Total current liabilities		4,302		6,797
Loan payable (Note 6,7)		19,337		18,785
Convertible notes (Note 7)		17,212		16,075
Share based liabilities		509		112
Lease liability		198		-
Warrant derivative (Note 9)		-		3,051
Total liabilities	$	41,558	$	44,820
SHAREHOLDERS' EQUITY
Share capital (Note 8)	$	861,890	$	855,270
Contributed surplus		28,278		26,777
Accumulated other comprehensive loss		(164,124)		(159,743)
Deficit		(746,313)		(738,912)
Total shareholders' deficit attributable to		(20,269)		(16,608)
shareholders of Platinum Group Metals Ltd.
Non-controlling interest		16,126		15,451
Total shareholders' deficit		(4,143)		(1,157)
Total liabilities and shareholders' deficit	$	37,415	$	43,663

Going Concern (Note 1)

Contingencies and Commitments (Note 12)

Subsequent Events (Note 19)

Approved by the Board of Directors and authorized for issue on November 25, 2020

/s/ Stuart Harshaw		/s/ Diana Walters
Stuart Harshaw, Director		Diana Walters, Director

The accompanying notes are an integral part of the consolidated financial statements. 2

PLATINUM GROUP METALS LTD.

Consolidated Statements of Loss and Comprehensive Loss

(in thousands of United States Dollars except share and per share data)

						Years Ended
				August 31,	August 31,	August 31,
					2020		2019		2018
Expenses
	General and administrative (Note 15)	$	3,726	$	4,677	$	6,084
	Interest				5,493		8,355		18,414
	Foreign exchange (gain) loss				(740)		1,006		4,068
	Share of joint venture expenditures - Lion Battery (Note 5)				369		595		-
	Stock compensation expense (Note 8)				1,569		787		77
	Closure, care and maintenance costs (recovery)				-		(509)		14,437
				$	10,417	$	14,911	$	43,080
Other Income
Loss (Gain) on fair value derivatives and warrants (Note 7,9)				(3,203)		2,732		(3,726)
Loss on Asset Held for Sale				-		-		2,304
(Gain) Loss on fair value of marketable securities				-		(609)		105
Net finance income				(158)		(364)		(739)
Loss for the year before income taxes			$	7,056	$	16,670	$	41,024
Deferred income tax expense				72		106		-
Loss for the year	$	7,128	$	16,776	$	41,024
Items that may be subsequently reclassified to net loss:
	Currency translation adjustment				4,487		(105)		(6,350)
	Tax impact of previously recorded to comprehensive loss				-		-		(15,527)
Comprehensive loss for the year	$	11,615	$	16,671	$	19,147
Loss attributable to:
	Shareholders of Platinum Group Metals Ltd.				7,128		16,776		38,682
	Non-controlling interests				-		-		2,342
		$	7,128	$	16,776	$	41,024
Comprehensive loss attributable to:
	Shareholders of Platinum Group Metals Ltd.				11,615		16,671		16,805
	Non-controlling interests				-		-		2,342
		$	11,615	$	16,671	$	19,147
Basic and diluted loss per common share	$	0.11	$	0.52	$	2.03
Weighted average number of common shares outstanding:
	Basic and diluted	61,537,004		32,534,646	19,053,144

The accompanying notes are an integral part of the consolidated financial statements.

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PLATINUM GROUP METALS LTD.

Consolidated Statements of Changes in Equity

(in thousands of United States Dollars, except # of Common Shares)

	# of Common		Share		Contributed		Accumulated		Deficit		Attributable to		Non-		Total
	Shares		Capital		Surplus		Other				Shareholders		Controlling
							Comprehensive				of the Parent		Interest
							Income (loss)				Company
Balance August 31, 2017	14,846,938	$	800,894	$	25,870	$	(170,505)	$	(667,617)	$	(11,358)	$	(11,908)	$	(23,266)
Stock based compensation	-		-		80		-		-		80		-		80
Shares issued for interest on convertible note	1,001,987		1,416		-		-		-		1,416		-		1,416
Units issued - financing	13,254,486		18,557		-		-		-		18,557		-		18,557
Unit issuance costs	-		(2,413)		-		-		-		(2,413)		-		(2,413)
Non-controlling interest impact of the sale of Maseve	-		-		-		(11,114)		(7,690)		(18,804)		18,804		-
Equity impact from the partial sale of Waterberg	-		-		-		-		14,172		14,172		1,962		16,134
Contributions of Waterberg JV Co	-		-		-		-		-		-		4,636		4,636
Foreign currency translation adjustment	-		-		-		6,350		-		6,350		-		6,350
Tax impact from Waterberg and other equity transactions	-		-		-		15,527		(15,527)		-		-		-
Net loss for the year	-		-		-		-		(38,682)		(38,682)		(2,342)		(41,024)
Balance August 31, 2018	29,103,411	$	818,454	$	25,950	$	(159,742)	$	(715,344)	$	(30,682)	$	11,152	$	(19,530)
IFRS 9 transition adoption on September 1, 2018	-		-		-		-		(5,781)		(5,781)		-		(5,781)
Balance September 1, 2018 (restated)	29,103,411	$	818,454	$	25,950	$	(159,742)	$	(721,125)	$	(36,463)	$	11,152	$	(25,311)
Stock based compensation	-		-		827		-		-		827		-		827
Shares issued for interest on convertible note	545,721		687		-		-		-		687				687
Share issuance - financing	27,077,885		35,024		-		-		-		35,024				35,024
Share issuance costs	-		(1,876)		-		-		-		(1,876)		-		(1,876)
Warrants exercised	1,048,770		1,981		-		-		-		1,981		-		1,981
Shares issued for loan facility	800,000		1,000		-		-		-		1,000		-		1,000
Contributions of Waterberg JV Co	-		-		-		-		(1,117)		(1,117)		4,299		3,182
Foreign currency translation adjustment	-		-		-		105		-		105		-		105
Net loss for the year	-		-		-		-		(16,776)		(16,776)		-		(16,776)
Balance August 31, 2019	58,575,787	$	855,270	$	26,777	$	(159,637)	$	(739,018)	$	(16,608)	$	15,451	$	(1,157)
Stock based compensation	-				1,501		-		-		1,501		-		1,501
Shares issued for interest on convertible note	1,043,939		1,374		-		-		-		1,374		-		1,374
Share issuance - financing	4,447,307		5,705		-		-		-		5,705		-		5,705
Share issuance costs	-		(514)		-		-		-		(514)		-		(514)
Warrants exercised	28,040		55		-		-		-		55		-		55
Contributions of Waterberg JV Co.	-		-		-		-		(167)		(167)		675		508
Foreign currency translation adjustment	-		-		-		(4,487)		-		(4,487)		-		(4,487)
Net loss for the year	-		-		-		-		(7,128)		(7,128)		-		(7,128)
Balance August 31, 2020	64,095,073		861,890		28,278		(164,196)		(746,241)		(20,269)		16,126		(4,143)

The accompanying notes are an integral part of the consolidated financial statements.

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PLATINUM GROUP METALS LTD.

Consolidated Statements of Cash Flows

(in thousands of United States Dollars)

			For the year ended
		August 31,		August 31,		August 31,
		2020		2019		2018
OPERATING ACTIVITIES
Loss for the year	$	(7,128)	$	(16,776)	$	(41,024)
Add items not affecting cash:
Depreciation		177		235		347
Interest expense		5,493		8,355		18,414
Unrealized foreign exchange gain (loss)		128		13		(65)
Share of joint venture expenditures		369		595		-
Loss on assets held for sale		-		-		2,305
Gain (Loss) on fair value of convertible debt derivatives		(3,203)		2,732		(3,726)
(Gain) Loss on marketable securities		-		(609)		105
Deferred tax expense		72		106		-
Stock compensation expense		1,569		787		77
Directors fees paid in deferred share units		142		112		-
Net change in non-cash working capital (Note 13)		(739)		(502)		209
	$	(3,120)	$	(4,952)		(23,358)
FINANCING ACTIVITIES
Share issuance - warrant exercise	$	48	$	1,783	$	-
Proceeds from issuance of equity		5,705		25,024		19,882
Equity issuance costs		(514)		(1,876)		(2,562)
Cash received from sale of Maseve		-		-		62,000
Costs associated with convertible note		-		-		(95)
Convertible note interest paid		-		(687)		-
Cash proceeds from debt		-		20,000		10,000
Costs associated with debt		(40)		(228)		(866)
Sprott principal repayments		-		-		(50,000)
Sprott interest paid		(2,237)		(73)		(3,401)
Lease payments made		(66)		-		-
Repayment of Liberty debt and production payment termination		-		(41,023)		(23,163)
Cash received from Waterberg partners		1,697		3,522		2,756
		4,593		6,442		14,551
INVESTING ACTIVITIES
Proceeds from partial sale of interest in Waterberg	$	-	$	-	$	16,124
Fees paid on asset held for sale		-		-		(1,000)
Transfer to restricted cash (Waterberg)		-		-		(5,000)
Expenditures from restricted cash (Waterberg)		-		126		4,874
Investment in Lion Battery		(350)		(554)		-
Cash received from sale of marketable securities		-		7,951		-
Proceeds from the sale of concentrate		-		-		2,016
Performance bonds		(67)		19		-
Waterberg exploration expenditures		(4,953)		(6,990)		(9,125)
		(5,370)		552		7,889
Net decrease in cash and cash equivalents		(3,897)		2,042		(918)
Effect of foreign exchange on cash and cash equivalents		(345)		491		521
Cash and cash equivalents, beginning of year		5,550		3,017		3,414
Cash and cash equivalents, end of year	$	1,308	$	5,550	$	3,017
The accompanying notes are an integral part of the consolidated financial statements.			5

PLATINUM GROUP METALS LTD.

Notes to the Consolidated Financial Statements

(in thousands of United States Dollars except share and per share data)

1. NATURE OF OPERATIONS AND GOING CONCERN

Platinum Group Metals Ltd. (the "Company") is a British Columbia, Canada, company formed by amalgamation on February 18, 2002. The Company's shares are publicly listed on the Toronto Stock Exchange ("TSX") in Canada and the NYSE American LLC ("NYSE American") in the United States (formerly the NYSE MKT LLC). The Company's address is Suite 838-1100 Melville Street, Vancouver, British Columbia, V6E 4A6.

The Company is an exploration and development company conducting work on mineral properties it has staked or acquired by way of option agreements in the Republic of South Africa.

These financial statements consolidate the accounts of the Company and its subsidiaries. The Company's subsidiaries, associates and joint ventures (collectively with the Company, the "Group") as at August 31,

2020 are as follows:

		Place of	Proportion of ownership
		incorporation	interest and voting power held
		and	August 31,	August 31,
Name of subsidiary	Principal activity	operation	2020	2019
Platinum Group Metals (RSA) (Pty) Ltd.	Exploration	South Africa	100.0%	100.0%
Mnombo Wethu Consultants (Pty) Limited.1	Exploration	South Africa	49.9%	49.9%
Waterberg JV Resources (Pty) Ltd.1,2	Exploration	South Africa	37.05%	37.05%
Lion Battery Technologies Inc.3	Research	Canada	55.00%	57.69%

1. The Company controls and consolidates Mnombo Wethu Consultants (Pty) Limited ("Mnombo") and Waterberg JV Resources (Pty) Ltd. ("Waterberg JV Co.") for accounting purposes.
2. Effective ownership of Waterberg JV Co. is 63.05% when Mnombo's ownership portion is combined with Platinum Group Metals (RSA) (Pty) Ltd. ("PTM RSA") ownership portion.
3. Lion Battery Technologies is accounted for using the equity method as the Company jointly controls the investee despite having the majority of the shares.

These consolidated financial statements have been prepared in accordance with the International Financial Reporting Standards ("IFRS") applicable to a going concern which contemplates that the Company will be able to realize its assets and settle its liabilities in the normal course as they come due for the foreseeable future. During the year the Company incurred a loss of $7.1 million and used cash in operating activities of $3.1 million. The Company had a working capital deficit of $2.4 million at August 31, 2020 and was also indebted $20 million pursuant to the Sprott Loan Facility (as defined below). This debt is due August 14, 2021 with the Company holding the option to extend the maturity date by one year in exchange for a payment in common shares or cash of three percent of the outstanding principal amount. Additional payments/interest are also due on the convertible debt. The Company currently has limited financial resources and has no sources of operating income at present. Subsequent to year end the Company has completed a private placement for $2.5 million and through an At-The-Market Offering has raised a further $10 million. Please see Note 19 Subsequent Events for further details.

In March 2020 the World Health Organization declared coronavirus COVID-19 a global pandemic. The contagious disease outbreak, which has continued to spread, and any related adverse public health developments, has adversely affected workforces, economies and financial markets globally, potentially leading to an economic downturn. It is not possible for the Company to predict the duration or magnitude of the adverse results of the outbreak and its effects on the Company's business or ability to raise funds.

The Company's ability to continue operations in the normal course of business will therefore depend upon its ability to secure additional funding by methods that could include debt refinancing, equity financing, the sale of assets and strategic partnerships. Management believes the Company will be able to secure further funding as required although there can be no assurance that these efforts will be successful. Nonetheless, there exist material uncertainties resulting in substantial doubt as to the ability of the Company to continue to meet its obligations as they come due and hence, the ultimate appropriateness of the use of accounting principles applicable to a going concern.

These consolidated financial statements do not include adjustments or disclosures that may result should the Company not be able to continue as a going concern. If the going concern assumption were not

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PLATINUM GROUP METALS LTD.

Notes to the Consolidated Financial Statements

(in thousands of United States Dollars except share and per share data)

appropriate for these consolidated financial statements, then adjustments would be required to the carrying value of assets and liabilities, the expenses, the reported comprehensive loss and balance sheet classifications used that would be necessary if the Company were unable to realize its assets and settle its liabilities as a going concern in the normal course of operations. These adjustments could be material.

2. BASIS OF PRESENTATION AND SIGNIFICANT ACCOUNTING POLICIES

These consolidated financial statements have been prepared by management and are in accordance with International Financial Reporting Standards ("IFRS") as issued by the International Accounting Standards Board. The consolidated financial statements have been prepared under the historical cost convention except for certain financial assets and liabilities measured at fair value.

Significant Accounting Policies

The principal accounting policies applied in the preparation of these consolidated financial statements are set out below. The Company has consistently applied the accounting policies used in the preparation of its IFRS financial statements throughout all years presented, as if these policies had always been in effect except for the adoption of IFRS 16 Leases, ("IFRS 16") effective for the 2020 fiscal year.

a. Consolidation

The consolidated financial statements include those of the Company, its subsidiaries, joint ventures and structured entities that it controls, using uniform accounting policies. Control exists when the Company has (i) power over the investee, (ii) exposure, or rights, to variable returns from its involvement with the investee, and (iii) the ability to use its power to affect its returns.

Non-controlling interests in the net assets of consolidated subsidiaries are identified separately from the Company's equity.

Subsidiaries are all entities over which the Company has control. Subsidiaries are fully consolidated from the date on which control is transferred to the Group. They are de-consolidated from the date that control ceases.

Inter-company transactions, balances and unrealized gains on transactions between Group companies are eliminated on consolidation. Unrealized losses are also eliminated unless the transaction provides evidence of an impairment of the asset transferred.

b. Translation of foreign currencies

Functional currency

Items included in the financial statements of the Company and each of the Company's subsidiaries and equity accounted investees are measured using the currency of the primary economic environment in which the entity operates (the functional currency) as follows:

Platinum Group Metals Ltd.	Canadian Dollars
Lion Battery Technologies Inc.	United States Dollars
Platinum Group Metals (RSA) (Pty) Ltd.	South African Rand
Mnombo Wethu Consultants (Pty) Limited	South African Rand
Waterberg JV Resources (Pty) Ltd	South African Rand

Presentation Currency

The Company's presentation currency is the United States Dollar ("USD")

Foreign Exchange Rates Used

The following exchange rates were used when preparing these consolidated financial statements:

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PLATINUM GROUP METALS LTD.

Notes to the Consolidated Financial Statements

(in thousands of United States Dollars except share and per share data)

Rand/USD
Year-end rate:	R16.8916 (2019 R15.2099)
Year average rate:	R16.0676 (2019 R14.3314)
CAD/USD
Year-end rate:	C$1.3042 (2019 C$1.3295)
Year average rate:	C$1.3458 (2019 C$1.3255)

Transactions and balances

Foreign currency transactions are translated into the relevant entity's functional currency using the exchange rates prevailing at the date of the transaction. Foreign currency gains and losses resulting from the settlement of such transactions and from the translation at period-end exchange rates of monetary assets and liabilities denominated in foreign currencies are recognized in the income statement.

Subsidiaries

The results and financial position of subsidiaries that have a functional currency different from the presentation currency are translated into the presentation currency as follows:

1. • Assets and liabilities are translated at the closing rate at the reporting date;
   • Income and expenses are translated at average exchange rates for the period; and
   • All resulting exchange differences are recognized in other comprehensive income as cumulative translation adjustments.
2. Joint Arrangements

The Company treats its investment in Lion Battery Technologies Inc. as a joint venture. A joint venture is a joint arrangement whereby the parties that have joint control have rights to the net assets. Joint ventures are accounted for using the equity method of accounting.

d. Change in ownership interests

The Company treats transactions with non-controlling interests that do not result in a loss of control as transactions with equity owners. A change in ownership interest results in an adjustment between the carrying amounts of the controlling and non-controlling interests to reflect their relative interest in the subsidiary. Any difference between the amount of the adjustment to non-controlling interests and any consideration received is recognized in a separate line in retained earnings.

e. Cash and cash equivalents

Cash and cash equivalents consist of cash and short-term deposits, which are readily convertible to cash and have original maturities of 90 days or less.

1. Exploration and evaluation assets

Exploration and evaluation activity involves the search for mineral resources, the determination of technical feasibility and the assessment of commercial viability of an identified resource.

Exploration and evaluation activity includes:

• acquiring the rights to explore;
• researching and analyzing historical exploration data;
• gathering exploration data through topographical, geochemical and geophysical studies;
• exploratory drilling, trenching and sampling;
• determining and examining the volume and grade of the resource;
• surveying transportation and infrastructure requirements; and

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PLATINUM GROUP METALS LTD.

Notes to the Consolidated Financial Statements

(in thousands of United States Dollars except share and per share data)

• compiling pre-feasibility and feasibility studies.

Exploration and evaluation expenditures on identifiable properties are capitalized. Exploration and evaluation assets are shown separately until technical feasibility and commercial viability is achieved at which point the relevant asset is transferred to development assets under property, plant and equipment. Capitalized costs are all considered to be tangible assets as they form part of the underlying mineral property.

Capitalized exploration and evaluation assets are reviewed for impairment when facts or circumstances suggest an asset's carrying amount may exceed its recoverable amount and when the exploration and evaluation assets are transferred to development assets. If impairment is considered to exist, the related asset is written down to the greater of its value in use and its fair value less costs to sell.

1. Property, plant and equipment

Property, plant and equipment are stated at cost less accumulated depreciation and accumulated impairment losses. The cost of an item of property, plant and equipment includes the purchase price or construction cost, any costs directly attributable to bringing the asset to the location and condition necessary for its intended use, an initial estimate of the costs of dismantling and removing the item and restoring the site on which it is located, and for qualifying assets, the associated borrowing costs.

Where an item of property, plant and equipment is comprised of major components with different useful lives, the components are accounted for as separate items of property, plant and equipment.

Once a mining project has been established as technically feasible and commercially viable, expenditure other than on land, buildings, plant and equipment is capitalised as part of "development assets" together with any related amount transferred from "exploration and evaluation assets". Capitalization of costs incurred ceases when the property is capable of operating at levels intended by management.

Subsequent costs are included in the asset's carrying amount only when it is probable that future economic benefits associated with the item will flow to the Company and the cost of the item can be reliably measured. All repairs and maintenance are expensed to profit or loss during the financial period in which they are incurred.

An item of property, plant and equipment is derecognized upon disposal or when no future economic benefits are expected to arise from the continued use of the asset. Any gain or loss arising on the disposal, retirement or scrapping of an item of property, plant and equipment is determined as the difference between the sales proceeds and the carrying amount of the asset and is recognized in profit or loss.

Property plant and equipment are recorded at cost and are depreciated on a straight-line basis over the following periods:

Vehicles	3-5 years
Computer Equipment and software	3-5 years
Furniture and Fixtures	5 years

1. Impairment

Tangible assets are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount may not be recoverable.

The Company conducts internal reviews of asset values which are used to assess for any indications of impairment. External factors such as changes in expected future prices, costs and other market factors including market capitalization are also monitored to assess for indications of impairment.

If any such indication exists an estimate of the recoverable amount is undertaken, being the higher of an asset's fair value less costs to sell and its value in use. If the asset's carrying amount exceeds its

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PLATINUM GROUP METALS LTD.

Notes to the Consolidated Financial Statements

(in thousands of United States Dollars except share and per share data)

recoverable amount, then an impairment loss is recognized.

Fair value is determined as the amount that would be obtained from the sale of the asset in an arm's length transaction between knowledgeable and willing parties. Fair value of mineral assets is generally determined as the present value of the estimated future cash flows expected to arise from the use of the asset, including any expansion prospects.

Value in use is determined as the present value of the estimated future cash flows expected to arise from the continued use of the asset in its present form and from its ultimate disposal.

Tangible assets that have been impaired are tested for possible reversal of the impairment whenever events or changes in circumstances indicate that the impairment may have reversed. When a reversal of a previous impairment is recorded, the reversal amount is adjusted for depreciation that would have been recorded had the impairment not taken place.

1. Trade payables

Trade payables are obligations to pay for goods or services that have been acquired in the ordinary course of business from suppliers. Accounts payable are classified as current liabilities if payment is due within one year or less. If not, they are presented as non-current liabilities.

Trade payables are recognised initially at fair value and subsequently measured at amortized cost using the effective interest method.

1. Convertible Notes

At inception the debt component of the convertible notes is deemed to be the residual value of the net proceeds after the fair value of the embedded derivatives are separated. The debt component is then measured at amortized cost using the effective interest method. The embedded derivatives are revalued at each reporting period with the change in fair value being recorded in profit or loss in each reporting period.

1. Share Capital

Common shares are classified as equity. Incremental costs directly attributable to the issue of common shares and share options are recognized as a deduction from equity, net of any tax effect.

1. Share-basedpayment transactions

Stock options

Stock options are settled in equity. The fair values for stock-based awards have been estimated using the Black-Scholes model and recorded as compensation cost over the period of vesting. The compensation cost related to stock options granted is expensed or capitalized to mineral properties, as applicable. Cash received on exercise of stock options is credited to share capital and the related amount previously recognized in contributed surplus is reclassified to share capital.

Restricted share units

Restricted share units ("RSU") represent an entitlement to one common share of the Corporation, upon vesting. RSUs provide the option of being settled in cash upon election by the Board of Directors. The fair value of RSUs granted is recognized as an expense over the vesting period and is measured at the time of grant.

Deferred share units

Deferred share units ("DSU's") are measured at fair value on grant date. The expense for DSU's is recognized over the vesting period. DSU liabilities are adjusted at each financial position reporting date

10

PLATINUM GROUP METALS LTD.

Notes to the Consolidated Financial Statements

(in thousands of United States Dollars except share and per share data)

for changes in fair value. When the directors retire from all positions with the Company the DSU liability is settled in cash.

1. Income taxes

Income tax expense represents the sum of the tax currently payable and deferred tax.

Current tax

Current tax expense is based on taxable profit for the year. Taxable profit differs from 'profit before tax' as reported in the consolidated statement of loss and other comprehensive loss because of items of income or expense that are taxable or deductible in other years and items that are never taxable or deductible. The Company's current tax is calculated using tax rates that have been enacted or substantively enacted by the end of the reporting period.

Deferred tax

Deferred tax is recognised on temporary differences between the carrying amounts of assets and liabilities in the consolidated financial statements and the corresponding tax bases used in the computation of taxable profit. Deferred tax liabilities are generally recognised for all taxable temporary differences. Deferred tax assets are generally recognised for all deductible temporary differences to the extent that it is probable that taxable profits will be available against which those deductible temporary differences can be utilised. Such deferred tax assets and liabilities are not recognised if the temporary difference arises from the initial recognition (other than in a business combination) of assets and liabilities in a transaction that affects neither the taxable profit nor the accounting profit.

The carrying amount of deferred tax assets is reviewed at the end of each reporting period and reduced to the extent that it is no longer probable that sufficient taxable profits will be available to allow all or part of the asset to be recovered.

Deferred tax liabilities and assets are measured at the tax rates that are expected to apply in the period in which the liability is settled or the asset realised, based on tax rates (and tax laws) that have been enacted or substantively enacted by the end of the reporting period.

The measurement of deferred tax liabilities and assets reflects the tax consequences that would follow from the manner in which the Group expects, at the end of the reporting period, to recover or settle the carrying amount of its assets and liabilities.

1. Loss per common share

Basic loss per common share is calculated using the weighted average number of common shares outstanding. The Company uses the treasury stock method for the calculation of diluted earnings per share. Diluted per share amounts reflect the potential dilution that could occur if securities or other contracts to issue common shares were exercised or converted to common shares. In periods when a loss is incurred, the effect of the potential issuances of shares is anti-dilutive, and accordingly basic and diluted loss per share are the same.

1. Financial instruments

Classification

The Company classifies its financial instruments in the following categories: at fair value through profit and loss, at fair value through other comprehensive income (loss), or at amortized cost. The Company determines the classification of financial assets at initial recognition. The classification of debt instruments is driven by the Company's business model for managing the financial assets and the debt's contractual cash flow characteristics. Equity instruments that are held for trading are classified as FVTPL. For other equity instruments, on the day of acquisition the Company can make an irrevocable election (on an instrument-by-instrument basis) to designate them as at FVTOCI. Financial liabilities are measured at amortized cost, unless they are required to be measured at FVTPL (such as instruments held for trading

11

PLATINUM GROUP METALS LTD.

Notes to the Consolidated Financial Statements

(in thousands of United States Dollars except share and per share data)

or derivatives) or if the Company has opted to measure them at FVTPL.

Measurement

Financial assets and liabilities at amortized cost are initially recognized at fair value plus or minus transaction costs, respectively, and subsequently carried at amortized cost less any impairment. Financial assets and liabilities carried at FVTPL are initially recorded at fair value and transaction costs are expensed in the consolidated statements of comprehensive loss. Realized and unrealized gains and losses arising from changes in the fair value of the financial assets and liabilities held at FVTPL are included in the consolidated statements of comprehensive loss in the period in which they arise.

Derecognition of Financial assets

The Company derecognizes financial assets only when the contractual rights to cash flows from the financial assets expire, or when it transfers the financial assets and substantially all of the associated risks and rewards of ownership to another entity. Gains and losses on derecognition are generally recognized in the consolidated statements of comprehensive loss.

1. Accounting Standards Adopted

Recently Issued Accounting Pronouncements

The following new accounting standard was adopted by the Company during the year:

1. IFRS 16, Leases
   In January 2016, the IASB issued IFRS 16. IFRS 16 sets out the principles for the recognition, measurement, presentation and disclosure of leases for both parties to a contract, which is the customer ("lessee") and the supplier ("lessor"). IFRS 16 replaced IAS 17, Leases and related interpretations. Save for limited exceptions, all leases result in the lessee obtaining the right to use an asset at the start of the lease and, if lease payments are made over time, also obtaining financing. Accordingly, IFRS 16 eliminated the classification of leases as either operating leases or finance leases as previously required by IAS 17 and, instead, introduced a single lessee accounting model. Applying that model, a lessee is required to recognize:
2. 1. Assets and liabilities for all leases with a term of more than 12 months, unless the underlying assets is of low value; and
   2. Depreciation of lease assets separately from interest on lease liabilities in the statement of income.

The new standard became effective for annual periods beginning on or after January 1, 2019. As the Company's year end is August 31st, the first effective year was fiscal 2020. The adoption of this standard did not have a significant impact on the financial statements of the Company based on its leasing activity at September 1, 2019.

3. SIGNIFICANT ACCOUNTING JUDGEMENTS AND ESTIMATES

The preparation of the financial statements in conformity with IFRS requires the use of judgments and estimates that affect the amount reported and disclosed in the consolidated financial statements and related notes. These judgments and estimates are based on management's best knowledge of the relevant facts and circumstances, having regard to previous experience, but actual results may differ materially from the amounts included in the financial statements. Information about such judgments and estimation is contained in the accounting policies and notes to the financial statements, and the key areas are summarized below.

Areas of judgment and key sources of estimation uncertainty that have the most significant effect on the amounts recognized in these consolidated financial statements are:

• Determination of ore reserves and mineral resource estimates
• Fair value of embedded derivatives including convertible debt derivative
• Assumption of control of Mnombo for accounting purposes

12

PLATINUM GROUP METALS LTD.

Notes to the Consolidated Financial Statements

(in thousands of United States Dollars except share and per share data)

Each of these judgments and estimates is considered in their respective notes or in more detail below.

Fair value of embedded derivatives

Where the fair value of financial liabilities recorded in the financial statements cannot be derived from active markets, their fair value is determined using various other valuation techniques. Inputs to the estimation are taken from observable markets where possible, but where this is not feasible, an increased degree of estimation uncertainty arises when establishing fair values. The estimates include considerations of inputs such as liquidity risk, credit risk and volatility. Changes in assumptions about these factors could affect the reported fair value of financial instruments. When measuring the fair value of an asset or liability, the Company uses observable market data as far as possible.

Determination of ore reserve and mineral resource estimates

The Company estimates its ore reserves and mineral resources based on information compiled by Qualified Persons as defined by NI 43-101. There are numerous uncertainties inherent in estimating ore reserves, and assumptions that are valid at the time of estimation and they may change significantly when new information becomes available. Changes in the forecast prices of commodities, exchange rates, production costs or recovery rates may change the economic status of reserves and may, ultimately, result in reserves being restated.

Assumption of control of Mnombo and Waterberg JV Resources for accounting purposes

The Company has judged that it controls Mnombo for accounting purposes as it owns 49.9% of the outstanding shares of Mnombo and has contributed all material capital to Mnombo since acquiring its 49.9% share. Currently there are no other sources of funding known to be available to Mnombo. If in the future Mnombo is not deemed to be controlled by the Company, the assets and liabilities of Mnombo would be derecognized at their carrying amounts. Amounts recognized in other comprehensive income would be transferred directly to retained earnings. If a retained interest remained after the loss of control it would be recognized at its fair value on the date of loss of control. Although the Company controls Mnombo for accounting purposes, it does not have omnipotent knowledge of Mnombo's other shareholders activities. Mnombo's 50.1% shareholders are historically disadvantaged South Africans. The Company also determined that it controls Waterberg JV Resources given its control over Mnombo as well as its power over the investee.

4. EXPLORATION AND EVALUATION ASSETS

Since mid-2015, the Company's only active exploration project has been the Waterberg Project located on the North Limb of the Western Bushveld Complex. Total capitalized exploration and evaluation expenditures for all exploration properties held by the Company are as follows:

Balance, August 31, 2018	$	29,406
Additions		8,362
Foreign exchange movement		(976)
Balance, August 31, 2019	$	36,792
Additions		2,988
Recoveries from 100% Impala funded implementation budget		(1,285)
Foreign exchange movement		(3,556)
Balance, August 31, 2020	$	34,939

13

PLATINUM GROUP METALS LTD.

Notes to the Consolidated Financial Statements

(in thousands of United States Dollars except share and per share data)

Waterberg Project

At August 31, 2020 the Waterberg Project consisted of granted prospecting rights and an applied for mining right with a combined active project area of 81,329.60 ha, located on the Northern Limb of the Bushveld Complex, approximately 85 km north of the town of Mokopane (formerly Potgietersrus). As of late October 2020, the Company is in process to apply for closure on one prospecting right located north of the known mineralized area, measuring 13,158.92 ha. The Waterberg Project comprises the former Waterberg JV Property and the Waterberg Extension Property.

On August 21, 2017, PTM RSA completed the cession of legal title for all Waterberg Project prospecting rights into Waterberg JV Co. after earlier receiving Section 11 approval of the 2nd Amendment (defined below). On September 21, 2017, Waterberg JV Co. also issued shares to all existing Waterberg partners pro rata to their joint venture interests, resulting in the Company holding a 45.65% direct interest in Waterberg JV Co., the Japan Oil, Gas and Metals National Corporation ("JOGMEC") holding a 28.35% interest and Mnombo, as the Company's Black Economic Empowerment ("BEE") partner, holding 26%.

Implats Transaction

On November 6, 2017, the Company closed a transaction (the "Implats Transaction"), originally announced on October 16, 2017, whereby Impala Platinum Holdings Ltd. ("Implats"):

1. Purchased an aggregate 15.0% equity interest in Waterberg JV Co (the "Initial Purchase") for $30 million. The Company sold an 8.6% interest for $17.2 million and JOGMEC sold a 6.4% interest for $12.8 million. From its $17.2 million in proceeds, the Company committed $5.0 million towards its pro rata share of remaining Definitive Feasibility Study ("DFS") costs, which was held as restricted cash until it was fully spent in October 2018. Implats contributed its 15.0% pro rata share of DFS costs incurred subsequent to the Initial Purchase. Following the Initial Purchase, the Company held a direct 37.05% equity interest, JOGMEC held a 21.95% equity interest and Black Economic Empowerment partner Mnombo maintained a 26.0% equity interest. The Company holds a 49.9% interest in Mnombo, bringing its overall direct and indirect ownership in Waterberg JV Co. to 50.02%.
2. Acquired a right of first refusal to enter into an offtake agreement, on commercial arms-length terms, for the smelting and refining of mineral products from the Waterberg Project ("Offtake ROFR"). JOGMEC or its nominee will retain a right to receive, at market prices, platinum, palladium, rhodium, gold, ruthenium, iridium, copper and nickel in refined mineral products at the volumes produced from the Waterberg Project.
3. Acquired an option (the "Purchase and Development Option") whereby Implats had the right within 90 business days of the completion of the DFS to exercise an option to increase its interest to 50.01% in Waterberg JV Co by committing to purchase an additional 12.195% equity interest in Waterberg JV Co. from JOGMEC for $34.8 million and an expenditure of $130.2 million in development work. The DFS was completed and approved by Waterberg JV Co. on December 5, 2019. As per the February 27, 2020 amendment (see below) this deadline was amended to occur 90 days following the receipt of an executed Mining Right on the Waterberg Project.
4. On February 27, 2020 the Company announced that shareholders of Waterberg JV Co had agreed to amend the Purchase and Development Option effective at February 1, 2020. The Purchase and Development Option was amended to expire 90 calendar days following the receipt of an executed Mining Right for the Waterberg Project. In exchange for this extension Impala agreed to fund 100% of a new implementation budget and work program, effective February 1, 2020, aimed at increasing confidence in specific areas of the DFS. At year end total Waterberg JV Co. expenditures recovered through this work program were $1,285.
   On June 15, 2020, Implats delivered a formal notice of their election not to exercise their Purchase and Development Option due to increased economic uncertainty and reduced risk appetite in the short, medium and long-term as a result of the COVID-19 pandemic. Implats will retain a 15.0% participating project interest and their Offtake ROFR and the Company will retain a controlling 50.02% direct and indirect interest in the project. Impala continued to be responsible for the costs of an implementation

14

PLATINUM GROUP METALS LTD.

Notes to the Consolidated Financial Statements

(in thousands of United States Dollars except share and per share data)

budget and work program, as described above, until September 13, 2020. The Company remains the Manager of the Waterberg Project, as directed by the technical committee of the Waterberg JV Co.

Acquisition and Development of the Waterberg Project

In October 2009, PTM RSA, JOGMEC and Mnombo entered into a joint venture agreement with regard to the Waterberg Project (the "JOGMEC Agreement"). Under the terms of the JOGMEC Agreement, in April 2012, JOGMEC completed a $3.2 million work requirement to earn a 37% interest in the former Waterberg JV property, leaving the Company with a 37% interest and Mnombo with a 26% interest. Following JOGMEC's earn-in, the Company funded Mnombo's 26% share of costs, totalling $1.12 million, until the earn-in phase of the joint venture ended in May 2012.

On November 7, 2011, the Company entered an agreement with Mnombo to acquire 49.9% of the issued and outstanding shares of Mnombo in exchange for a cash payment of R1.2 million and the Company's agreement to pay for Mnombo's 26% share of costs on the Waterberg JV property until the completion of a feasibility study. Mnombo's share of expenditures prior to this agreement, and Mnombo's share of expenditures post DFS, are still owed to the Company ($4.8 million at August 31, 2020). The portion of Mnombo not owned by the Company is accounted for as a non-controlling interest, calculated at $7.1 million at August 31, 2020 ($6.9 million - August 31, 2019).

On May 26, 2015, the Company announced a second amendment (the "2nd Amendment") to the existing JOGMEC Agreement. Under the terms of the 2nd Amendment the Waterberg JV and Waterberg Extension properties are to be combined and contributed into the newly created operating company Waterberg JV Co. On August 3, 2017, the Company received Section 11 transfer approval from the South African Department of Mineral Resources ("DMR") and title to all of the Waterberg prospecting rights held by the Company were ceded into Waterberg JV Co. on September 21, 2017.

Under the 2nd Amendment, JOGMEC committed to fund $20 million in expenditures over a three-year period ending March 31, 2018. This requirement was completed by $8 million in funding from JOGMEC to March 31, 2016, followed by two $6 million tranches funded by JOGMEC in each of the following two 12-month periods ending March 31, 2018.

To August 31, 2020 an aggregate total of $75.2million has been funded by all parties on exploration and engineering on the Waterberg Project. Up until the Waterberg property was transferred to Waterberg JV Company, all costs incurred by other parties were treated as cost recoveries by the Company.

5. LION BATTERY

On July 12, 2019 the Company and Anglo American Platinum Limited ("Amplats") entered into agreements to launch a new venture named Lion Battery Technologies Inc. ("Lion"). Lion was incorporated on June 17, 2019 to research new lithium battery technology utilizing platinum and palladium. The Company invested $4 as the original founder of Lion in exchange for 400,000 common shares of Lion at a price of $0.01 per share. On July 12, 2019 the Company and Amplats each invested $550 as a first tranche of funding into Lion in exchange for 1,100,000 Lion preferred shares each at a price of $0.50 per share. On August 21, 2020 the Company and Amplats each invested $350 as a second tranche of funding in exchange for 700,000 Lion preferred shares each at a price of $0.50 per shares. At August 31, 2020 the Company owned a 55% interest in Lion.

On July 12, 2019 Lion entered into a Sponsored Research Agreement ("SRA") with Florida International University ("FIU") to fund a $3.0 million research program over approximately three years. Both the Company and Amplats have agreed to equally invest up to an aggregate of $4.0 million into Lion, of which approximately $1.0 million would be for general and administrative expenses and the commercialization of the technology developed, subject to certain conditions. All funding into Lion by the Company or Amplats is to be in exchange for preferred shares of Lion at a price of $0.50 per share over an approximate three to four year period (see above paragraph). The Company accounts for Lion using equity accounting as Lion is jointly controlled with Amplats. Lion pays a fee of $3 per month to the Company for general and administrative services. As at August 31, 2020, Lion batteries has $34 (2019 - $54) in current assets and $22 (2019 - $26) in current liabilities and for the year ended August 31, 2020, loss from operations

15

PLATINUM GROUP METALS LTD.

Notes to the Consolidated Financial Statements

(in thousands of United States Dollars except share and per share data)

and comprehensive loss is $716 (2019 - $1,076).

Research work commenced at FIU during September 2019. During calendar 2020 FIU completed the first milestone research requirements pursuant to the SRA, which triggered the second tranche of funding to Lion in August 2020 for an aggregate amount of $700, of which $667 was provided by Lion to FIU for continued research.

Under the agreement with FIU, Lion will have exclusive rights to all intellectual property developed and will lead all commercialization efforts. Lion is also currently reviewing several additional and complementary opportunities focused on developing next-generation battery technology using platinum and palladium.

1. SPROTT LOAN
   On August 15, 2019 the Company announced it had entered into a credit agreement with Sprott Private Resource Lending II (Collector), LP ("Sprott") and other lenders party thereto (the "Sprott Lenders") pursuant to which the Sprott Lenders advanced $20.0 million principal senior secured credit facility ("Sprott Facility"). The loan was immediately drawn and is due August 14, 2021, with the Company holding the option to extend the maturity date by one year in exchange for a payment in common shares or cash of three percent of the outstanding principal amount. All amounts outstanding will be charged interest of 11% per annum compounded monthly. Interest payments are made monthly with interest of $2,237 having been paid to Sprott during the year ended August 31, 2020 (August 31, 2019 - $73).
   The Company is required to maintain certain minimum working capital and cash balances under the Sprott loan and are in compliance with these covenants at period end.
   All fees directly attributable to the Sprott Facility are recorded against the loan balance and amortized using the effective interest method over the life of the loan. In connection with the advance the Company issued Sprott 800,000 common shares worth $1,000. Effective interest of $2,809 was recognized during the year ended August 31, 2020 (August 31, 2019 - $83).
   Subsequent to year end, the Company repaid a principal amount of $1.9 million to Sprott, reducing the principal amount outstanding to $18.1 million.
2. CONVERTIBLE NOTES
   On June 30, 2017, the Company closed a private placement of $20 million aggregate principal amount of convertible senior subordinated notes ("Convertible Notes") due 2022. The Convertible Notes bear interest at a rate of 6 7/8% per annum, payable semi-annually on January 1 and July 1 of each year, beginning on January 1, 2018, in cash or at the election of the Company, in common shares of the Company or a combination of cash and Common Shares, and will mature on July 1, 2022, unless earlier repurchased, redeemed or converted. An additional interest charge of 0.25% for the period January 1, 2018 to March 31, 2018, plus a further 0.25% for the period April 1, 2018 to July 1, 2018, was added to the coupon rate of the Convertible Notes at the Company's election to not file a prospectus and a registration statement for the Convertible Notes with Canadian securities regulatory authorities and with the U.S. Securities and Exchange Commission. After July 1, 2018, at which time the Convertible Notes became freely tradable by holders other than affiliates, the Convertible Notes once again bear interest at the coupon rate of 6 7/8% per annum.
   Upon maturity the Convertible Notes are to be settled by the Company in cash. The Convertible Notes are convertible at any time prior to maturity at the option of the holder, and conversion may be settled, at the Company's election, in cash, Common Shares, or a combination of cash and Common Shares. If any Convertible Notes are converted on or prior to the three and one half year anniversary of the issuance date, the holder of the Convertible Notes will also be entitled to receive an amount equal to the remaining interest payments on the converted notes to the three and one half year anniversary of the issuance date, discounted by 2%, payable in Common Shares. The initial conversion rate of the Convertible Notes was 1,001.1112 Common Shares per $1,000 principal amount of Convertible Notes, which is equivalent to an initial conversion price of approximately $0.9989 per Common Share, representing a conversion premium

16

PLATINUM GROUP METALS LTD.

Notes to the Consolidated Financial Statements

(in thousands of United States Dollars except share and per share data)

of approximately 15% above the NYSE American closing sale price for the Company's Common Shares of $0.8686 per share on June 27, 2017. After giving effect to the December 13, 2018 share consolidation, the conversion rate is 100.1111 per US$1,000 which is equivalent to a conversion price of approximately $9.989 per common share.

The Convertible Notes contain multiple embedded derivatives (the "Convertible Note Derivatives") relating to the conversion and redemption options. The Convertible Note Derivatives were valued upon initial recognition at fair value using partial differential equation methods at $5,381 (see below). At inception, the debt portion of the Convertible Notes were reduced by the estimated fair value of the Convertible Note Derivatives of $5,381 and transaction costs relating to the Convertible Notes of $1,049 resulting in an opening balance of $13,570. The Convertible Notes are measured at amortized cost and will be accreted to maturity over the term using the effective interest method.

On January 2, 2018, the Company issued 244,063 common shares in settlement of $691 of bi-annual interest payable on $19.99 million of outstanding Convertible Notes.

On July 3, 2018, the Company issued 757,924 common shares in settlement of $724 of bi-annual interest payable on $19.99 million of outstanding Convertible Notes.

On January 2, 2019 the Company issued 545,721 common shares in settlement of $687 of bi-annual interest payable on $19.99 million of outstanding Convertible Notes.

On July 1, 2019 the Company paid $687 of bi-annual interest payable on outstanding Convertible Notes.

On January 2, 2020 the Company issued 517,468 common shares in settlement of $687 of bi-annual interest payable on $19.99 million of outstanding Convertible Notes.

On July 2, 2020 the Company issued 526,471 common shares in settlement of $687 of bi-annual interest payable on $19.99 million of outstanding Convertible Notes.

The components of the Convertible Notes are as follows:

Convertible Note balance August 31, 2018	$	14,853
Transactions costs incurred		(79)
Interest payments		(1,374)
Accretion and interest incurred during the year		2,487
Loss on embedded derivatives during the year ended August 31, 2019 (see below)		188
Convertible Note balance August 31, 2019	$	16,075
Interest payments		(1,374)
Accretion and interest incurred during the year		2,668
Gain on embedded derivatives during the year ended August 31, 2020 (see below)		(157)
Convertible Note balance August 31, 2020	$	17,212

Embedded Derivatives

The Convertible Note Derivatives were valued upon initial recognition at a fair value of $5,381 using partial differential equation methods and are subsequently re-measured at fair value at each period-end through the consolidated statement of net loss and comprehensive loss. The fair value of the Convertible Note Derivatives was measured at $197 at August 31, 2019, then $40 at August 31, 2020 resulting in a gain of $157 for the year. Combined with the gain on the warrant derivative (Note 9) of $3,046, this results in a gain of $3,203.

8. SHARE CAPITAL

1. Authorized
   Unlimited common shares without par value.

17

PLATINUM GROUP METALS LTD.

Notes to the Consolidated Financial Statements

(in thousands of United States Dollars except share and per share data)

1. Issued and outstanding
   On November 20, 2018 the Company announced a consolidation of its common shares on the basis of one new share for ten old shares (1:10). The purpose of the consolidation was to increase the Company's common share price to be in compliance with the NYSE American's low selling price requirement. All share and loss per share numbers in these financial statements are presented on a post consolidation basis.
   At August 31, 2020, the Company had 64,095,073 shares outstanding. Fiscal 2020
   On June 17, 2020 the Company closed a non-brokered private placement for 1,221,500 common shares at a price of US$1.40 each for gross proceeds of $1.7 million, of which 500,000 common shares were subscribed for by Deepkloof Limited ("Deepkloof"), a subsidiary of existing major shareholder Hosken Consolidated Investments Limited ("HCI"), bringing HCI's ownership in the Company to approximately 31.59%. A 6% finders fee in the amount of $38 was paid on a portion of this private placement.
   On December 19, 2019 the Company closed a non-brokered private placement for 3,225,807 common shares at a price of US$1.24 each for gross proceeds of $4.0 million, of which 1,612,931 common shares were subscribed for by Deepkloof on behalf of HCI. A 6% finders fee in the amount of $54 was paid on a portion of this private placement.
   During fiscal 2020 the Company issued 28,040 shares upon the exercise of 28,040 warrants.
   On January 2, 2020, the Company issued 517,468 shares in settlement of $687 of bi-annual interest payable on $19.99 million outstanding on the Convertible Notes.
   On July 2, 2020 the Company issued 526,471 common shares in settlement of $687 of bi-annual interest payable on $19.99 million of outstanding Convertible Notes.
   Fiscal 2019
   On August 21, 2019, the Company closed a bought deal financing of 8,326,957 common shares at a price of US$1.25 per share for gross proceeds of $10.4 million. Also, on August 21, 2019 the Company completed the sale of 7,575,758 common shares to existing shareholder Liberty Metals & Mining Holdings, LLC ("LMM"), a subsidiary of Liberty Mutual Insurance, and 6,940,000 common shares to Deepkloof on behalf of HCI, both at price of US$1.32 per share for gross proceeds of $10.0 million and $9.1 million respectively. Total fees of $1,769 were paid on the August 21, 2019 transactions including a 6% finders fee of $624.
   On June 28, 2019 the Company closed a non-brokered private placement with Deepkloof for gross proceeds of $1.3 million. The Company issued an aggregate of 1,111,111 common shares to Deepkloof at a price of US$1.17 per common share. On a non-diluted basis and after giving effect to the private placement, HCI's ownership in the Company (through subsidiary Deepkloof) was increased from 20.05% to 22.60% of the Company's then issued and outstanding common shares. The Company did not pay any finder's fees in connection with this private placement.
   On February 4, 2019, the Company completed a non-brokered private placement of 3,124,059 shares at a price of US$1.33 per share for gross proceeds of $4.16 million. A 6% finders fee of $72 was paid on a portion of this private placement, with total issuance costs (including the finders fee) totalling $107.
   During fiscal 2019, the Company issued 1,048,770 shares upon the exercise of 1,048,770 warrants.
   On January 2, 2019 the Company issued 545,721 shares in settlement of $687.16 of bi-annual interest payable on $19.99 million of outstanding Convertible Notes.
2. Incentive stock options

18

PLATINUM GROUP METALS LTD.

Notes to the Consolidated Financial Statements

(in thousands of United States Dollars except share and per share data)

The Company has entered into Incentive Stock Option Agreements under the terms of its share compensation plan with directors, officers, consultants and employees. Under the terms of the stock option agreements, the exercise price of each option is set, at a minimum, at the fair value of the common shares at the date of grant. Stock options of the Company are subject to vesting provisions. All exercise prices are denominated in Canadian Dollars.

The following tables summarize the Company's outstanding stock options:

		Average Exercise
	Number of Shares	Price CAD$
Options outstanding at August 31, 2018	308,550	45.20
Forfeited/Cancelled	(308,550)	45.20
Granted	1,554,000	2.61
Options outstanding at August 31, 2019	1,554,000	2.61
Granted	1,628,500	1.81
Options outstanding at August 31, 2020	3,182,500	2.20

Number Outstanding	Number Exercisable	Exercise Price	Average Remaining
at August 31, 2020	at August 31, 2020			Contractual Life (Years)
1,554,000	388,500	C$	2.61	3.61
1,628,500	-		1.81	4.26
3,182,500	388,500			3.94

During the year ended August 31, 2020 the Company granted 1,628,500 stock options. The stock options granted during the year vest in three tranches on the first, second and third anniversary of their grant. The Company recorded $1,157 ($1,032 expensed and $125 capitalized to mineral properties) of compensation expense during fiscal 2020.

The Company used the Black-Scholes model to determine the grant date fair value of stock options granted. The following assumptions were used in valuing stock options granted during the years ending August 31, 2020 and August 31, 2019:

Year ended	August 31, 2020	August 31, 2019
Risk-free interest rate	1.56%	1.6%
Expected life of options	3.9 years	3.9 years
Annualized volatility1	82%	74%
Forfeiture rate	2.1%	2.1%
Dividend rate	0.0%	0.0%

1The Company uses its historical volatility as the basis for the expected volatility assumption in the Black Scholes option pricing model.

1. Deferred Share Units
   The Company has established a DSU plan for non-executive directors. Each DSU has the same value as one Company common share. DSU's must be retained until the director leaves the Board of Directors, at which time the DSU's are paid.
   The DSU liability at August 31, 2020 was $509. During the year ended August 31, 2020 an expense of $387 was recorded in relation to the outstanding DSUs (August 31, 2019 - $113), with $245 recorded as share-based compensation (August 31, 2019, $63) and $142 recorded as director fees (August 31, 2019, $50). At August 31, 2020, 575,070 DSUs have been issued with 93,928 having been cancelled during the year. 163,220 DSU's had vested as at August 31, 2020.
2. Restricted Share Units
   The Company has established an RSU plan for certain employees of the Company. Each RSU has the

19

PLATINUM GROUP METALS LTD.

Notes to the Consolidated Financial Statements

(in thousands of United States Dollars except share and per share data)

same value as one Company common share. RSU's vest over a three year period.

The RSU liability at August 31, 2020 was $447. During the year ended August 31, 2020 an expense of $343 was recorded ($292 expensed and $51 capitalized) in relation to the outstanding RSUs, (August 31, 2019 $102, $86 expensed, $15 capitalized). At August 31, 2020, 393,897 RSU's have been issued with 74,473 vested. Subsequent to year end a total of 42,629 vested RSUs have been redeemed by holders.

1. WARRANT DERIVATIVE
   The exercise price of the Company's outstanding warrants was denominated in US Dollars; however, the functional currency of PTM Canada (the warrant issuer) is the Canadian Dollar. The warrants were required to be recognized and measured at fair value at each reporting period. Any changes in fair value from period to period were recorded as non-cash gain or loss in the consolidated statement of loss and comprehensive loss.
   The warrants were issued May 15, 2018 and were initially valued using the residual value method. An initial valuation of $1,171 was attributed to the warrants, which included $157 of unit issuance costs being attributed to the value of the warrants. As the warrants were publicly traded on the TSX, the value of the warrants at each period was estimated by using the warrant TSX closing price on the last day of trading in the applicable period. The warrants expired November 22, 2019 with a $Nil value. The $3,046 value attributed to the remaining warrants, which expired, was recognized as a gain during the year ended August 31, 2020 (August 31, 2019 - $2,605 loss). When combined with the gain on the embedded derivatives in the Convertible Notes (see Note 7) this results in a gain of $3,203 on derivatives.
2. NON-CONTROLLINGINTEREST
   The table below shows details of non-wholly owned subsidiaries of the Group that have material non- controlling interests:

Company	Proportion of	Loss allocated to	Accumulated
	ownership and	non-controlling	non-controlling
	voting rights held	interests	interests
	by non-controlling
	interests
	2020	2019	2020	2019	2020	2019
Mnombo Wethu Consultants (Pty)	50.1%	50.1%	-	-	7,064	6,889
Limited
Waterberg JV Co1	63.05%	63.05%	-	-	9,062	8,562
				Total
				16,126	$ 15,451
1Includes the 26% owned by Mnombo

11. RELATED PARTY TRANSACTIONS

1. All amounts receivable and amounts payable owing to or from related parties are non-interest bearing with no specific terms of repayment. Transactions with related parties are in the normal course of business and are recorded at consideration established and agreed to by the parties. Transactions with related parties are as follows:

2. During the year ended August 31, 2020 $313 ($326 - August 31, 2019) was paid or accrued to independent directors for directors' fees and services.
3. During the year ended August 31, 2020, the Company paid or accrued payments of $54 ($54 - August 31, 2019) from West Vault Mining Inc. ("West Vault" formerly West Kirkland Mining Inc.), a company with two directors in common, for accounting and administrative services. All amounts due from West Kirkland have been paid subsequent to year end.

20

PLATINUM GROUP METALS LTD.

Notes to the Consolidated Financial Statements

(in thousands of United States Dollars except share and per share data)

1. In fiscal 2018, the Company closed a private placement with Deepkloof whereby HCI acquired a right to nominate one person to the board of directors of the Company and a right to participate in future equity financings of the Company to maintain its pro-rata interest. HCI has exercised its right to nominate one person to the board of directors. In February, August and December 2019, then in June and October 2020 through private placements Deepkloof subscribed for 2,141,942, 6,940,000, 612,931, 500,000 and 1,146,790 shares respectively. At August 31, 2020 HCI's total ownership interest was approximately 31.33%.
   Key Management Compensation
   The remuneration the CEO, CFO and other key management personnel and the directors during the years ended August 31, 2020 to 2018 is as follows:

Year ended	August 31, 2020	August 31, 2019	August 31, 2018
Salaries	$	916	$	927	$	963
Directors fees		261		171		184
Share-based payments - management		907		393		13
Share-based payments - directors		52		155		12
Total	$	2,136	$	1,646	$	1,172

12. CONTINGENCIES AND COMMITMENTS

The Company's remaining minimum payments under its office and equipment lease agreements in Canada and South Africa total approximately $313 to March 2022.

Contractor payments are based on approximate costs to complete services remaining at Waterberg. From year end the Company's aggregate commitments are as follows:

Payments Due By Year

		< 1 Year		1 - 3 Years		4 - 5 Years	> 5 Years			Total
Lease Obligations	$	103	$	168	$	42	$	-	$	313
Convertible Note		1,374		21,364		-		-		22,738
Sprott Facility (Note 6)		22,726		-		-		-		22,726
Totals	$	24,203	$	21,532	$	42	$	-	$	45,777

Africa Wide Legal Action

In April 2018 the Company completed a transaction whereby Maseve Investments 11 (Pty) Ltd. ("Maseve") was acquired (the "Maseve Sale Transaction") by Royal Bafokeng Platinum Ltd. ("RBPlats"). Maseve owned and operated the Maseve Mine. In September 2018 the Company reported receipt of a summons issued by Africa Wide Mineral Prospecting and Exploration Proprietary Limited ("Africa Wide") whereby Africa Wide instituted legal proceedings in South Africa against PTM RSA, RBPlats and Maseve in relation to the Maseve Sale Transaction. Africa Wide held 17.1% of the shares in Maseve prior to completion of the Maseve Sale Transaction. Africa Wide is seeking, at this late date, to set aside or be paid increased value for, the closed Maseve Sale Transaction. RBPlats consulted with senior counsel, both during the negotiation of the Maseve Sale Transaction and in regard to the current Africa Wide legal proceedings. The Company has received legal advice to the effect that the Africa Wide action, as issued, is ill-conceived and is factually and legally defective.

Tax Audit South Africa

For the 2014, 2015 and 2016 fiscal years, PTM RSA claimed unrealized foreign exchange losses as income tax deductions in its South African corporate tax returns in the amount of Rand 1.4 billion. The exchange losses emanate from a Canadian dollar denominated shareholder loan advanced to PTM RSA.

21

PLATINUM GROUP METALS LTD.

Notes to the Consolidated Financial Statements

(in thousands of United States Dollars except share and per share data)

Under applicable South African tax legislation, exchange losses can be claimed if the shareholder loan is a current liability as determined by IFRS. For the years in question, the intercompany debt was classified as current in PTM RSA's stand alone audited financial statements.

During 2018, the South African Revenue Service ("SARS") conducted an income tax audit of the 2014 to 2016 years of assessment and issued PTM RSA with a letter of audit findings on November 5, 2018 proposing that the exchange losses be disallowed on the basis that the shareholder loan was not a current liability.

The Company and its advisors responded to SARS during 2019 and refuted the issues raised.

On June 30, 2020 the Company received a letter from SARS reporting the finalization of the above income tax audit with no reassessment or adjustment to the Company's tax returns for the three years audited.

Brokerage Fees Payable

There were certain deferred brokerage fees related to the Maseve Sale Transaction and the Implats Transaction that became payable as soon as practicable after the Company repaid a $40 million secured loan facility due to LMM (the "LMM Facility"). The outstanding fee amount payable of $2,890 was reclassified to current liabilities after repayment of the LMM Facility on August 21, 2019. Subsequent to year end an amount of $1.4 million was paid against the outstanding fee amount payable, reducing the aggregate balance due to $1.5 million.

13.	SUPPLEMENTARY CASH FLOW INFORMATION
	Net change in non-cash working capital:
		Year ended	August		August		August
		31, 2020		31, 2019		31, 2018
		Amounts receivable, prepaid expenses and other assets $	234	$	195	$	(42)
		Accounts payable and other liabilities	(973)		(6971)		251
	$	(739)	$	(502)	$	209

1Prior year reclassification: An amount of $112 has been reclassified from Accounts payable and other liabilities for the year ended August 31, 2019. The classification was made to present DSU's as a separate line to conform with the current year presentation.

Other Items:
Capitalized stock option expense	$	175	$	108	$	3

14. SEGMENTED REPORTING

Segmented information is provided on the basis of geographical segments as the Company manages its business and exploration activities through geographical regions - Canada and South Africa. The Chief Operating Decision Makers ("CODM") reviews information from the below segments separately so the below segments are separated. This represents a change from prior years and comparative information has been represented to reflect the way the CODM currently reviews the information

22

PLATINUM GROUP METALS LTD.

Notes to the Consolidated Financial Statements

(in thousands of United States Dollars except share and per share data)

The Company evaluates performance of its operating and reportable segments as noted in the following table:

					At August 31, 2020			Assets			Liabilities
					Canada	$		2,101	$		40,922
					South Africa			35,314			636
						$		37,415	$		41,558
					At August 31, 2019			Assets			Liabilities
					Canada	$		4,983	$		39,278
					South Africa			38,680			5,542
						$		43,663	$		44,820
					Comprehensive Loss for the year ended		August 31, 2020	August 31, 2019
					Canada	$		10,681	$	16,471
					South Africa			934		200
						$		11,615	$	16,671
15.	GENERAL AND ADMINISTRATIVE EXPENSES
				GENERAL AND ADMINISTRATIVE			Year Ending		Year Ending
				EXPENSES			August 31,		August 31,
								2020		2019
				Salaries and benefits		$	1,407	$	1,423
				Professional/consulting fees				960		1,230
				Shareholder relations				284		173
				Insurance				241		193
				Regulatory Fees				214		214
				Travel				174		323
				Depreciation				177		235
				Asset Impairment				-		344
				Equipment rental and storage				-		342
				Other				269		200
				Total		$	3,726	$	4,677

16. CAPITAL RISK MANAGEMENT

The Company's objectives in managing its liquidity and capital are to safeguard the Company's ability to continue as a going concern and provide financial capacity to meet its strategic objectives. The capital structure of the Company consists of share capital, contributed surplus, accumulated other comprehensive loss and accumulated deficit.

The Company manages the capital structure and makes adjustments to it in light of changes in economic conditions and the risk characteristics of the underlying assets. To maintain or adjust the capital structure, the Company may issue new shares, issue new debt, acquire or dispose of assets.

In order to facilitate the management of its capital requirements, the Company regularly updates the Board of

23

PLATINUM GROUP METALS LTD.

Notes to the Consolidated Financial Statements

(in thousands of United States Dollars except share and per share data)

Directors with regard to budgets, forecasts, results of capital deployment and general industry conditions. The Company does not currently declare or pay out dividends.

As at August 31, 2020, the Company is subject to externally imposed capital requirements under the Sprott Facility. Please see Note 6 for further details.

17. FINANCIAL INSTRUMENTS AND RISK MANAGEMENT

The Company examines the various financial risks to which it is exposed and assesses the impact and likelihood of occurrence. These risks may include credit risk, liquidity risk, currency risk, interest rate risk and other price risks.

1. Credit risk

Credit risk arises from the risk that the financial asset counterparty, may default or not meet its obligations timeously. The Company minimizes credit risk by monitoring the reliability of counterparties to settle assets. The maximum exposure to the credit risk is represented by the carrying amount of all the financial assets. There is no material concentration of credit risk in cash and cash equivalents, trade and other receivables and loans.

1. Cash

In order to manage credit and liquidity risk the Company holds cash only with Canadian chartered and South African banks.

1. Performance Bonds

In order to explore and develop its properties in South Africa, the Company was required to post performance bonds as financial guarantees against future reclamation work. These funds are held with Standard Bank of South Africa Limited with the DMR as beneficiary in accordance with the Mineral and Petroleum Resources Development Act (the "MPRDA") and the Company's environmental management programme.

1. Liquidity risk

The Company has in place a planning and budgeting process to help determine the funds required to support the Company's normal operating requirements and its exploration and development plans. The Company regularly updates the Board of Directors with regard to budgets, forecasts, results of capital deployment and general industry conditions.

The Company may be required to source additional financing by way of private or public offerings of equity or debt or the sale of project or property interests in order to have sufficient cash to make debt repayments and working capital for continued exploration on the Waterberg Projects, as well as for general working capital purposes.

Any failure by the Company to obtain additional required financing on acceptable terms could cause the Company to delay development of its material projects or could result in the Company being forced to sell some of its assets on an untimely or unfavourable basis. Any such delay or sale could have a material and adverse effect on the Company's financial condition, results of operations and liquidity. Also refer to Note 1 for discussion of going concern risk.

1. Currency risk

The Company's functional currency is the Canadian dollar, while the consolidated presentation currency is the United States Dollar. The functional currency of all South African subsidiaries is the Rand, while the functional currency of Lion Battery Technology Inc. is the US Dollar. The Company's operations are in both Canada and South Africa; therefore, the Company's results are impacted by fluctuations in the value of foreign currencies in relation to the Rand and Canadian and United States dollars. The Company's significant foreign currency exposures on financial instruments comprise cash, loans payable, warrants, convertible notes, accounts

24

PLATINUM GROUP METALS LTD.

Notes to the Consolidated Financial Statements

(in thousands of United States Dollars except share and per share data)

payable and accrued liabilities. The Company has not entered into any agreements or purchased any instruments to hedge possible currency risks at this time.

The Company is exposed to foreign exchange risk through the following financial instruments denominated in a currency other than Canadian dollars:

Year ended		August 31,		August 31,
	2020		2019
Cash (Rand)	$	100	$	1,204
Cash (USD)		1,189		3,708
Accounts receivable (Rand)		140		436
Accounts payable (Rand)		636		2,767
Loan Payable (USD)		19,337		18,785
Convertible Note (USD)		17,212		16,075

The Company's comprehensive loss is affected by changes in the exchange rate between its operating currencies and the United States dollar. At August 31, 2020, based on this exposure a 10% strengthening/weakening in the United States dollar versus Rand foreign exchange rate and Canadian dollar would give rise to a decrease/increase in comprehensive loss for the year presented of approximately $3.5 million, (August 31, 2019 - $3.4 million).

1. Interest rate risk

The Company's interest income earned on cash and on short term investments is exposed to interest rate risk. At August 31, 2020, based on this exposure a 1% change in the average interest rate would give rise to an increase/decrease in the net loss for the year of approximately $12.

At August 31, 2020, the carrying amounts of cash, amounts receivable, performance bonds and accounts payable and accrued liabilities are considered to be reasonable approximations of their fair values due to the short-term nature of these instruments.

18. INCOME TAXES

The income taxes shown in the consolidated earnings differ from the amounts obtained by applying statutory rates to the earnings before provision for income taxes due to the following:

		2020		2019		2018
Loss before income taxes	$	7,056	$	16,670	$	40,024
Income tax recovery at statutory rates		(1,905)		(4,503)		(10,941)
Difference of foreign tax rates		(8)		(2)		(231)
Non-deductible expenses and non-taxable portion of capital gains		(216)		1,316		358
Changes in unrecognized deferred tax assets and other		2,201		3,295		10,814
Income tax expense (recovery)		72		106		-
Income tax expense (recovery) consists of:
Current income taxes	$	-	$	-	$	-
Deferred income taxes		72		106		-
	$	72	$	106	$	-

25

PLATINUM GROUP METALS LTD.

Notes to the Consolidated Financial Statements

(in thousands of United States Dollars except share and per share data)

The gross movement on the net deferred income tax account is as follows:

				2020		2019		2018
		Deferred tax liability at the beginning of the year	$	-	$	-	$	-
		Tax (expense) relating to the loss from continuing		(72)		(106)		(15,527)
		operations
		Tax recovery relating to components of other		72		106		-
		comprehensive loss
		Tax recovery recorded in deficit		-		-		15,527
		Deferred tax liability at the end of the year	$	-	$	-	$	-
		The significant components of the Company's net deferred income tax liabilities are as
		follows:
				2020		2019		2018
		Convertible notes	$	(661)	$	(1,024)	$	-
		Loans payable		(247)		(339)		-
		Mineral properties		(2,221)		(2,354)		(2,434)
		Loss carry-forwards		3,129		3,717		2,434
			$	-	$	-	$	-
		Unrecognized deductible temporary differences, unused tax losses and unused tax credits are
		attributed to the following:
				2020		2019		2018
		Tax Losses:
		Operating loss carry-forwards - Canada	$	137,029	$	125,851	$	106,058
		Operating loss carry-forwards - South Africa		100,409		28,925		23,026
		Net capital loss carry-forwards		-		204		621
			$		$	154,980	$	129,705
		Temporary Differences:
		Mineral properties	$	7,672	$	7,526	$	7,664
		Financing Costs		7,539		13,357		18,831
		Property, plant and equipment		697		807		735
		Other		603		381		254
			$	16,511	$	22,071	$	27,484
		Investment Tax Credits:	$	318	$	312	$	318

The Company's Canadian operating loss carry-forwards expire between 2026 and 2040. The Company's South African operating loss carry-forwards do not expire. The Company's Canadian unused investment tax credit carry- forwards expire between 2029 and 2035. The Company's Canadian net capital loss carry-forwards do not expire.

• 19. SUBSEQUENT EVENTS

• On September 4, 2020 the Company announced it had entered into an equity distribution agreement ("ATM") with BMO Capital Markets. Under the sales agreement the Company may sell its common shares from time to time for up to $12 million in aggregate sales proceeds in "at the market" transactions. At the conclusion of the trading day on November 24th the Company had sold 4,617,177 common shares at an average price of $2.16 for gross proceeds of $10 pursuant to the ATM.
• On October 15, 2020 the Company announced it had closed a non-brokered private placement with HCI. An aggregate of 1,146,790 shares were issued for US$2.18 per share resulting in gross proceeds of $2.5 million to the Company. Closing the private placement allowed the HCI to maintain a greater than 31% interest in the Company.

26

Platinum Group Metals Ltd.

(An Exploration and Development Stage Company)

Supplementary Information and Management's Discussion and Analysis

For the year ended August 31, 2020

This Management's Discussion and Analysis is prepared as of November 25, 2020 A copy of this report will be provided to any shareholder who requests it.

PLATINUM GROUP METALS LTD.

(An Exploration and Development Stage Company) Supplementary Information and MD&A

For the year ended August 31, 2020

MANAGEMENT'S DISCUSSION AND ANALYSIS

This management's discussion and analysis ("MD&A") of Platinum Group Metals Ltd. ("Platinum Group", the "Company" or "PTM") is dated as of November 25, 2020 and focuses on the Company's financial condition cash flows and results of operations as at and for the year ended August 31, 2020. This MD&A should be read in conjunction with the Company's consolidated financial statements for the year ended August 31, 2020 together with the notes thereto (the "Financial Statements").

The Company prepares its financial statements in accordance with International Financial Reporting Standards ("IFRS"), as issued by the International Accounting Standards Board. All dollar figures included therein and in the following MD&A are quoted in United States Dollars unless otherwise noted. All references to "U.S. Dollars", "$" or to "US$" are to United States Dollars. All references to "C$" are to Canadian Dollars. All references to "R" or to "Rand" are to South African Rand. The Company uses the U.S. Dollar as its presentation currency.

PRELIMINARY NOTES

NOTE REGARDING FORWARD-LOOKING STATEMENTS:

This MD&A and the documents incorporated by reference herein contain "forward-looking statements" within the meaning of the United States Private Securities Litigation Reform Act of 1995 and "forward-looking information" within the meaning of applicable Canadian securities legislation (collectively, "Forward-LookingStatements"). All statements, other than statements of historical fact, that address activities, events or developments that the Company believes, expects or anticipates will, may, could or might occur in the future are Forward-Looking Statements. The words "expect", "anticipate", "estimate", "may", "could", "might", "will", "would", "should", "intend", "believe", "target", "budget", "plan", "strategy", "goals", "objectives", "projection" or the negative of any of these words and similar expressions are intended to identify Forward- Looking Statements, although these words may not be present in all Forward-Looking Statements. Forward-Looking Statements included or incorporated by reference in this MD&A may include, without limitation, statements related to:

• the timely completion of additional required financings and potential terms thereof;
• the repayment, and compliance with the terms of, indebtedness;
• the projections set forth or incorporated into, or derived from, the September 2019 Technical Report (as defined below), including, without limitation, estimates of mineral resources and mineral reserves, and projections relating to future prices of metals, commodities and supplies, currency rates, capital and operating expenses, production rate, grade, recovery and return, and other technical, operational and financial forecasts;
• the approval of a mining right and environmental authorizations for, and other developments related to, a deposit area discovered by the Company on the Waterberg property (the "Waterberg Project") located on the Northern Limb of the Bushveld Complex, approximately 85 km north of the town of Mokopane (formerly Potgietersrus);
• the adequacy of capital, financing needs and the availability of and potential for obtaining further capital;
• cash flow estimates and assumptions;
• future events or future performance;
• development of next generation battery technology by the Company's new battery technology joint venture (described below);
• governmental and securities exchange laws, rules, regulations, orders, consents, decrees, provisions, charters, frameworks, schemes and regimes, including interpretations of and compliance with the same;
• developments in South African politics and laws relating to the mining industry;
• anticipated exploration, development, construction, production, permitting and other activities on the Company's properties;
• project economics;
• the identification of several large-scale water basins that could provide mine process and potable water for the Waterberg Project and local communities;

2

PLATINUM GROUP METALS LTD.

(An Exploration and Development Stage Company) Supplementary Information and MD&A

For the year ended August 31, 2020

• the Company's expectations with respect to the outcomes of litigation; and
• potential changes in the ownership structures of the Company's projects.

Forward-Looking Statements are subject to a number of risks and uncertainties that may cause the actual events or results to differ materially from those discussed in the Forward-Looking Statements, and even if events or results discussed in the Forward-Looking Statements are realized or substantially realized, there can be no assurance that they will have the expected consequences to, or effects on, the Company. Factors that could cause actual results or events to differ materially from current expectations include, among other things:

• the inability of the Company to generate sufficient additional cash flow or raise sufficient additional capital to make payment on its indebtedness under the Sprott Facility (defined below) and the Notes, and to comply with the terms of such indebtedness, and the restrictions imposed by such indebtedness;
• the Company's additional financing requirements;
• the Company's $20.0 million initial principal secured credit facility (the "Sprott Facility") (principal balance $18.1 as at the current date) with Sprott Private Resource Lending II (Collector), LP ("Sprott") and the other lenders party thereto (the "Sprott Lenders"), as amended by a Credit Agreement Modification Agreement dated as of September 8, 2020 ("Modification Agreement") is, and any new indebtedness may be, secured and the Company has pledged its shares of Platinum Group Metals (RSA) Proprietary Limited, the Company's wholly owned subsidiary located in South Africa ("PTM RSA"), and PTM RSA has pledged its shares of Waterberg JV Resources Proprietary Limited ("Waterberg JV Co.") to Sprott under the Sprott Facility, which potentially could result in the loss of the Company's interest in PTM RSA and the Waterberg Project, in the event of a default under the Sprott Facility or any new secured indebtedness, and Mnombo (as defined below);
• the Company's history of losses and negative cash flow;
• the Company's ability to continue as a going concern;
• uncertainty of estimated production, development plans and cost estimates for the Waterberg Project;
• discrepancies between actual and estimated mineral reserves and mineral resources, between actual and estimated development and operating costs, between actual and estimated metallurgical recoveries and between estimated and actual production;
• fluctuations in the relative values of the U.S. Dollar, the Rand and the Canadian Dollar;
• volatility in metals prices;
• Implats or another third party may not enter into appropriate contractual smelting and/or refining arrangements with Waterberg JV Co.;
• the failure of the Company or the other shareholders of Waterberg JV Co. to fund their pro rata share of funding obligations for the Waterberg Project;
• any disputes or disagreements with the Company's other shareholders of Waterberg JV Co. or Mnombo Wethu Consultants (Pty) Ltd., a South African Broad-Based Black Economic Empowerment company ("Mnombo");
• the Company is subject to assessment by various taxation authorities, who may interpret tax legislation in a manner different from the Company, which may negatively affect the final amount or the timing of the payment or refund of taxes;
• the inability of Waterberg JV Co. to obtain the mining right for the Waterberg Project for which it has applied;
• the ability of the Company to retain its key management employees and skilled and experienced personnel;
• contractor performance and delivery of services, changes in contractors or their scope of work or any disputes with contractors;
• conflicts of interest among the Company's officers and directors;
• any designation of the Company as a "passive foreign investment company" and potential adverse U.S. federal income tax consequences for U.S. shareholders;

3

PLATINUM GROUP METALS LTD.

(An Exploration and Development Stage Company) Supplementary Information and MD&A

For the year ended August 31, 2020

• "non-acceleratedfiler" status and the reduced disclosure requirements may make securities less attractive to investors;
• litigation or other legal or administrative proceedings brought against the Company, including the current litigation brought by Africa Wide Mineral Prospecting and Exploration (Pty) Limited ("Africa Wide"), the former 17.1% shareholder of Maseve Investments 11 Proprietary Limited ("Maseve");
• actual or alleged breaches of governance processes or instances of fraud, bribery or corruption;
• exploration, development and mining risks and the inherently dangerous nature of the mining industry, including environmental hazards, industrial accidents, unusual or unexpected formations, safety stoppages (whether voluntary or regulatory), pressures, mine collapses, cave ins or flooding and the risk of inadequate insurance or inability to obtain insurance to cover these risks and other risks and uncertainties;
• property and mineral title risks including defective title to mineral claims or property;
• changes in national and local government legislation, taxation, controls, regulations and political or economic developments in Canada, South Africa or other countries in which the Company does or may carry out business in the future;
• equipment shortages and the ability of the Company to acquire the necessary access rights and infrastructure for its mineral properties;
• environmental regulations and the ability to obtain and maintain necessary permits, including environmental authorizations and water use licences;
• extreme competition in the mineral exploration industry;
• delays in obtaining, or a failure to obtain, permits necessary for current or future operations or failures to comply with the terms of such permits;
• any adverse decision in respect of the Company's mineral rights and projects in South Africa under the Mineral and Petroleum Resources Development Act of 2002 (the "MPRDA");
• risks of doing business in South Africa, including but not limited to, labour, economic and political instability and potential changes to and failures to comply with legislation;
• the failure to maintain or increase equity participation by historically disadvantaged South Africans in the Company's prospecting and mining operations and to otherwise comply with the Broad-BasedSocio-Economic Empowerment
  Charter for the South African Mining Industry, 2018 ("Mining Charter 2018");
• certain potential adverse Canadian tax consequences for foreign-controlled Canadian companies that acquire the Common Shares;
• the risk that the Common Shares may be delisted;
• volatility in the price of the Common Shares;
• possible dilution to holders of Common Shares upon the exercise or conversion of any outstanding stock options, warrants or the Notes, as applicable;
• global financial conditions; and
• other risks disclosed under the heading "Risk Factors" in this Annual Report and in our 2020 20-F (defined below).

These factors should be considered carefully, and investors should not place undue reliance on the Company's Forward- Looking Statements. In addition, although the Company has attempted to identify important factors that could cause actual actions or results to differ materially from those described in Forward-Looking Statements, there may be other factors that cause actions or results not to be as anticipated, estimated or intended.

Any Forward-Looking Statement speaks only as of the date on which it is made and, except as may be required by applicable securities laws, the Company disclaims any intent or obligation to update any Forward-Looking Statement, whether as a result of new information, future events or results or otherwise.

4

PLATINUM GROUP METALS LTD.

(An Exploration and Development Stage Company) Supplementary Information and MD&A

For the year ended August 31, 2020

LEGISLATION AND MINING CHARTER

The MPRDA, the Mining Charter 2018 and related regulations in South Africa require that Waterberg JV Co.'s Black Economic Empowerment ("BEE") shareholders own a 26% equity interest in Waterberg JV Co. to qualify for the grant of a mining right. Within 5 years of the effective date of the mining right, this BEE shareholding must be increased to 30%. The Department of Mineral Resources and Energy ("DMR") had obtained an exemption from applying the Generic BEE Codes under the BEE Act until October 31, 2016 and had applied for a further extension until December 31, 2016. While this exemption was extended to December 31, 2016, no further exemption was obtained thereafter, and, as a matter of law, the Generic BEE Codes now apply to the issuance and maintenance of licenses and other authorizations. As a matter of practice, the DMR has continued to apply the provisions of Mining Charter 2018 rather than the Generic BEE Codes.

For a comprehensive discussion of Mining Charter 2018, please refer to the section entitled "Risk Factors" in the Company's annual report on Form 20-F for the year ended August 31, 2020 ("the 2020 20-F"), which was also filed as the Company's form of AIF for 2020, as well as in the documents incorporated by reference therein. The 2020 20-F may be found on EDGAR at www.sec.govand the AIF may be found on SEDAR at www.sedar.com.

MINERAL RESERVES AND RESOURCES

The mineral resource and mineral reserve figures referred to in this MD&A and the documents incorporated herein by reference are estimates and no assurances can be given that the indicated levels of platinum, palladium, rhodium and gold (collectively referred to as "4E") will be produced. Such estimates are expressions of judgment based on knowledge, mining experience, analysis of drilling results and industry practices. Valid estimates made at a given time may significantly change when new information becomes available. By their nature, mineral resource and mineral reserve estimates are imprecise and depend, to a certain extent, upon statistical inferences which may ultimately prove unreliable. Any inaccuracy or future reduction in such estimates could have a material adverse impact on the Company.

NOTE TO U.S. INVESTORS REGARDING RESERVE AND RESOURCE ESTIMATES:

Estimates of mineralization and other technical information included or incorporated by reference herein have been prepared in accordance with National Instrument 43-101 - Standards of Disclosure for Mineral Projects ("NI 43-101"). The definitions of proven and probable reserves used in NI 43-101 differ from the definitions in SEC Industry Guide 7 ("Guide 7") of the U.S. Securities and Exchange Commission (the "SEC"). Under Guide 7 standards, a "final" or "bankable" feasibility study is required to report reserves, the three-year historical average price is used in any reserve or cash flow analysis to designate reserves and the primary environmental analysis or report must be filed with the appropriate governmental authority. As a result, the reserves reported by the Company in accordance with NI 43-101 may not qualify as "reserves" under Guide 7 standards. In addition, the terms "mineral resource," "measured mineral resource," "indicated mineral resource" and "inferred mineral resource" are defined in and required to be disclosed by NI 43-101; however, these terms are not defined terms under Guide 7 and have not historically been permitted to be used in reports and registration statements filed with the SEC subject to Guide 7. Mineral resources that are not mineral reserves do not have demonstrated economic viability. Investors are cautioned not to assume that any part or all of the mineral deposits in these categories will ever be converted into reserves. Inferred mineral resources have a great amount of uncertainty as to their existence, and great uncertainty as to their economic and legal feasibility. It cannot be assumed that all or any part of an inferred mineral resource will ever be upgraded to a higher category. Under Canadian securities laws, estimates of inferred mineral resources may not form the basis of feasibility or prefeasibility studies, except in rare cases. Additionally, disclosure of "contained ounces" in a resource is permitted disclosure under Canadian securities laws; however, Guide 7 normally only permits issuers to report mineralization that does not constitute "reserves" by SEC standards as in place tonnage and grade without reference to unit measurements. Accordingly, information contained in this MD&A and the documents incorporated by reference herein containing descriptions of the Company's mineral deposits may not be comparable to similar information made public by U.S. companies subject to Guide 7. The Company has not disclosed or determined any mineral reserves under the current SEC Industry Guide 7 standards in respect of any of its properties.

On October 31, 2018, the SEC adopted a final rule ("New Final Rule") that will replace Industry Guide 7 with new disclosure requirements that are more closely aligned with current industry and global regulatory practices and standards, including NI 43-101. Companies must comply with the New Final Rule for the company's first fiscal year beginning on or after January 1, 2021, which for Platinum Group would be the fiscal year beginning September 1, 2021. While early voluntary compliance with the New Final Rule will be permitted, Platinum Group has not elected to comply with the New Final Rule at this time.

5

PLATINUM GROUP METALS LTD.

(An Exploration and Development Stage Company) Supplementary Information and MD&A

For the year ended August 31, 2020

TECHNICAL AND SCIENTIFIC INFORMATION:

The technical and scientific information contained in this MD&A, including, but not limited to, all references to and descriptions of technical reports and studies included in this MD&A, has been reviewed and approved by R. Michael Jones, P.Eng, President and Chief Executive Officer and a director of the Company. Mr. Jones is a non-independent "qualified person" as defined in NI 43-101 (a "Qualified Person").

NON-GAAP MEASURES:

This MD&A may include certain terms or performance measures commonly used in the mining industry that are not defined under IFRS as issued by the International Accounting Standards Board, which is incorporated in the CPA Canada Handbook. We believe that, in addition to conventional measures prepared in accordance with IFRS, certain investors use this information to evaluate our performance. The data presented is intended to provide additional information and should not be considered in isolation or as a substitute for measures of performance prepared in accordance with IFRS. Any such non-GAAP measures should be read in conjunction with our financial statements.

1. DESCRIPTION OF BUSINESS OVERVIEW

Platinum Group Metals Ltd. is a British Columbia, Canada, company formed on February 18, 2002 pursuant to an order of the Supreme Court of British Columbia approving an amalgamation between Platinum Group Metals Ltd. and New Millennium Metals Corporation. The Company is a palladium and platinum focused exploration and development company conducting work primarily on mineral properties it has staked or acquired by way of option agreements or applications in the Republic of South Africa.

The Company's main business is currently focused on the exploration and development engineering of the Waterberg Project, which was discovered in 2011 as the result of a regional exploration initiative by the Company targeting a previously unknown extension to the Northern Limb of the Bushveld Complex in South Africa. The project area is now comprised of two adjacent property areas formerly known as the Waterberg joint venture project (the "Waterberg JV Project") and the Waterberg extension project (the "Waterberg Extension Project").

On November 6, 2017, the Company, along with Japan Oil, Gas and Metals National Corporation ("JOGMEC") and Mnombo closed a strategic transaction to sell Impala Platinum Holdings Ltd. ("Implats") 15% of the Waterberg Project for $30 million (the "Implats Transaction"). The Company sold an 8.6% interest for $17.2 million and JOGMEC sold a 6.4% interest for $12.8 million. Implats also acquired an option (the "Purchase and Development Option") within 90 days of the completion and approval of a definitive feasibility study by Waterberg JV Co. to increase its stake to 50.01% through additional share purchases from JOGMEC for an amount of $34.8 million and earn-in arrangements for $130 million to fund development work on the Waterberg Project, as well as a right of first refusal to smelt and refine Waterberg concentrate (the "Offtake ROFR"). JOGMEC, or their nominee retained a right to receive platinum, palladium, rhodium, gold, ruthenium, iridium, copper and nickel refined mineral products at the volumes produced from the Waterberg Project. The Company received $17.2 million for its sale of an 8.6% project interest to Implats. See details below.

On September 24, 2019, the Company published the results of the Definitive Feasibility Study for the Waterberg Project (the "Waterberg DFS") and it was approved by all Waterberg JV Co. shareholders on December 5, 2019. On October 7, 2019 the Waterberg DFS technical report entitled "Independent Technical Report, Waterberg Project Definitive Feasibility Study and Mineral Resource Update, Bushveld Complex, South Africa" (the "DFS Technical Report") was filed on SEDAR at www.sedar.comand on EDGAR at www.sec.gov. The DFS Technical Report is dated October 3, 2019 and was prepared by Michael Murphy, P. Eng. of Stantec Consulting Ltd., Charles J Muller, B. Sc. (Hons) Geology, Pri. Sci. Nat. of CJM Consulting (Pty) Ltd., and Gordon I Cunningham, B. Eng. (Chemical), Pr. Eng., FSAIMM of Turnberry Projects (Pty) Ltd. DRA Projects SA (Pty) Ltd., an experienced South African engineering and EPCM firm, provided the plant design and compiled the capital cost estimates for the project qualified persons. The DFS Technical Report also supports the disclosure of an updated independent mineral resource estimate effective September 4, 2019.

After the approval of the Waterberg DFS by Waterberg JV Co. shareholders on December 5, 2019, Implats had 90 business days (until April 17, 2020) to elect whether to exercise the Purchase and Development Option. The Purchase and Development Option was formally modified by the execution of an amending agreement on March 31, 2020 (the "Implats

6

PLATINUM GROUP METALS LTD.

(An Exploration and Development Stage Company) Supplementary Information and MD&A

For the year ended August 31, 2020

Option Amendment") wherein the deadline for Implats to exercise the Purchase and Development Option was extended to 90 days after the grant of a Mining Right. In exchange for the extension Implats agreed to fund 100% of an optimization budget and work program (the "2020 Work Program") beginning February 1, 2020. The 2020 Work Program, as approved by Waterberg JV Co., was aimed at increasing confidence in specific areas of the Waterberg DFS while awaiting the expected grant of a Mining Right and Environmental Authorization and was budgeted to cost approximately R55 million (US$4 million when announced). Except for budgeted geotechnical drilling, which could not be carried out before the grant of a Mining Right, the 2020 Work Program was completed at a cost of approximately $1.46 million on September 15, 2020.

On June 15, 2020 Implats delivered a formal notice that they did not intend to exercise their Purchase and Development Option to acquire and earn into a 50.01% interest in the Waterberg Project. Impala reported that notwithstanding the positive progress achieved to date, and the strategic alignment between the Waterberg Project and Implats stated portfolio objectives, the unprecedented events brought about by the COVID-19 pandemic has necessitated Implats management and Board to re-evaluate the impact of the increased economic uncertainty on Implats' strategy and risk appetite in the short, medium and long term. Implats reiterated their support of both the Waterberg Project and the JV Partners and plans to remain an active participant, including funding of their share of costs, subject to future considerations.

Implats retains a 15.0% participating project interest and their Offtake ROFR and the Company retains a controlling 50.02% direct and indirect interest in the project. The Company remains the Manager of the Waterberg Project, as directed by the technical committee of the Waterberg JV Co.

LION BATTERY TECHNOLOGIES INC.

On July 11, 2019, the Company, together with an affiliate of Anglo American Platinum Limited ("AAP"), launched a new venture through a jointly owned company, Lion Battery Technologies Inc. ("Lion") to accelerate the development of next generation battery technology using platinum and palladium. AAP and the Company have agreed together to invest up to a total of $4.0 million, subject to certain conditions, in exchange for preferred shares of Lion at a price of $0.50 per share over approximately a three to four year period. AAP and the Company have each invested an initial $550,000 into Lion in exchange for 1,100,000 preferred shares, while in June 2020 the Company and AAP invested a further $350,000 each into Lion in exchange for 700,000 preferred shares. The Company also invested $4,000 as the original founder's round into Lion in exchange for 400,000 common shares at a price of $0.01 per share.

Lion entered into an agreement (the "Sponsored Research Agreement") with Florida International University ("FIU") to fund a $3.0 million research program over approximately a three year period utilizing platinum and palladium to unlock the potential of Lithium Air and Lithium Sulphur battery chemistries to increase their discharge capacities and cyclability. Under the Sponsored Research Agreement, Lion will have exclusive rights to all intellectual property developed and will lead all commercialization efforts. Lion is to advance funding to FIU in four tranches. The first tranche, totaling $1.0 million plus a one-time fee of $50,000, was funded by Lion in mid July 2019, with a second tranche of $666,667 funded in June 2020 after FIU had reasonably completed a first set of specific research milestones. Two subsequent tranches of $666,667 each will be funded approximately every six to nine months based on the attainment of research milestones by FIU. Research work commenced at FIU during September 2019. Investment into Lion by AAP and the Company in excess of the $3.05 million earmarked for FIU is to be utilized by Lion for general and administrative costs and for future commercialization efforts by Lion. If the Company should fail to contribute its share of a required subscription to Lion, it would be in breach of its agreement with Lion and its interest in Lion may be subject to dilution.

In September 2020, the Company reported that the U.S. Patent and Trademark Office had issued Patent No. 10,734,636 B2 entitled "Battery Cathodes for Improved Stability" to FIU. Under the Sponsored Research Agreement, Lion has exclusive rights to all technology being developed by FIU with Lion's funding, including patents granted. The patent includes the use of platinum group metals and carbon nanotubes and other innovations in a lithium battery.

PERSONNEL

The Company's current complement of managers, staff and consultants in Canada consists of 6 individuals. The Company's complement of managers, staff, consultants, security and casual workers in South Africa currently consists of 7 individuals, as further described below:

• Including managers and staff there are five employees at the Company's Johannesburg office.
• There is one senior consultant acting as financial manager at the Company's Johannesburg office.

7

PLATINUM GROUP METALS LTD.

(An Exploration and Development Stage Company) Supplementary Information and MD&A

For the year ended August 31, 2020

• There are two individuals active at the Waterberg Project conducting engineering and geotechnical activities related to the 2020 Work Program.

The Waterberg Project is currently operated by the Company utilizing its own staff, consultants and personnel. Contract drilling, geotechnical, engineering and support services are utilized as required.

In addition to the above personnel, there are two persons whose employment with the Company ended by mutual agreement on May 31, 2020 that are temporarily serving as consultants at the Johannesburg office until December 31, 2020.

2. PROPERTIES

Under IFRS, the Company defers all acquisition, exploration and development costs related to mineral properties. The recoverability of these amounts is dependent upon the existence of economically recoverable mineral reserves, the ability of the Company to obtain the necessary financing to complete the development of the property, and any future profitable production, or alternatively upon the Company's ability to dispose of its interests on an advantageous basis. The Company evaluates the carrying value of its property interests on a regular basis. Management is required to make significant judgements to identify potential impairment indicators. Any properties management deems to be impaired are written down to their estimated net recoverable amount.

For more information on mineral properties, see below and Note 3 of the Company's August 31, 2020 consolidated financial statements.

MATERIAL MINERAL PROPERTY INTERESTS

Waterberg Project

Recent Activities

During the year ended August 31, 2020, approximately $3.0 million was spent at the Waterberg Project for engineering and exploration activities. At year end, $34.9 million in accumulated net costs had been capitalized to the Waterberg Project. Total expenditures on the property since inception from all investor sources are approximately $75.2 million.

Subsequent to the completion of the Waterberg DFS and the Implats Option Amendment, the 2020 Work Program funded by Implats until September 15, 2020 completed the following optimization and risk mitigation studies:

• Dry stacking of tailings to reduce water use and reduce tailings impoundment footprint.
• Confirmation of portal positions and detailed designs.
• Review of initial mining method, stope and sub level designs.
• Detailed benchmarking to comparable operations around the world and specifically in Africa.
• Detailed simulation of underground mining and surface systems.
• Possible use of battery electric underground vehicles and resulting reduced ventilation and cooling requirements, reduced electrical power requirements, and opex/capex implications.
• Possible use of Mobile Tunnel Boring.
• Review of water demand and supply and test drilling to confirm water resources.

Geotechnical drilling of boxcuts/portals and along planned decline pathways, budgeted at approximately R 27 million, was not completed before September 15, 2020 as such work first required the grant of a Mining Right. Total cost of the 2020 Work Program funded by Implats amounted to approximately $1.46 million (R24.7 million).

Waterberg DFS

On September 24, 2019, the Company published the results of the Waterberg DFS. Waterberg JV Co. shareholders approved the Waterberg DFS on December 5, 2019. Highlights of the Waterberg DFS include:

8

PLATINUM GROUP METALS LTD.

(An Exploration and Development Stage Company) Supplementary Information and MD&A

For the year ended August 31, 2020

• A significant increase in Mineral Reserves from the Project's 2016 Pre-Feasibility Study ("PFS") for a large-scale, shallow, decline-accessible, mechanised, palladium, platinum, gold and rhodium mine. Use of backfill in the Waterberg DFS design lowers risk and increases mined ore extraction rates.
• Annual Steady State production rate of 420,000 4E ounces. Estimated mine life of 45 years on current reserves. The planned production rate is by careful design in order to reduce capital costs and simplify construction and ramp-up.
• After-taxNet Present Value ("NPV") of $982 million, at an 8% real discount rate, using spot metal prices as at September 4, 2019 (Incl. $1,546 Pd/oz) ("Spot Prices").
• After-taxNPV of US$ 333 million, at an 8% real discount rate, using three-year trailing average metal prices up until
  September 4, 2019 (Incl. $1,055 Pd/oz) ("Three Year Trailing Prices").
• After-taxInternal Rate of Return ("IRR") of 20.7% at Spot Prices and 13.3% at Three Year Trailing Prices.
• Estimated project capital of approximately $874 million, including $87 million in contingencies. Peak project funding estimated at $617 million.
• On site Life of Mine average cash cost (inclusive of by-product credits and smelter discounts) for the Spot Metal Price scenario equates to $640 per 4E ounce.
• Updated measured and indicated mineral resources of 242 million tonnes at 3.38g/t 4E for 26.4 million 4E ounces (using 2.5 g/t 4E cut-off) and the deposit remains open on strike to the north and below an arbitrary depth cut-off of 1,250- meters.
• Proven and probable mineral reserves of 187 million tonnes at 3.24 g/t 4E for 19.5 million 4E ounces (using 2.5 g/t 4E cut-off).

The mineral resources for the Waterberg Project increased slightly based on in-fill drilling done during preparation of the Waterberg DFS. The mineral resources have been estimated based on 441 diamond drill holes and 583 deflections and has been stated at a 2.5 g/t 4E cut-off (the base-case). In the Waterberg DFS, a 2.5 g/t 4E cut-off grade has been applied to the mineral resource model as an input into the mine design. At the 2.5 g/t 4E cut-off grade, the total measured and indicated mineral resources are estimated at 242 million tonnes grading 3.38 g/t 4E for an estimated 26.4 million ounces 4E. Total mineral reserves at a 2.5 g/t 4E grade cut-off are estimated at 187 million tonnes for 19.5 million ounces 4E.

The mineral reserves are a subset of the mineral resource envelope at a 2.5 g/t 4E cut-off and they include only measured and indicated mineral resources with dilution and stope shapes considered. A minimum mining thickness of 2.4 meters and sublevel planning of 20 meters to 40 meters was considered in the mine plan for mineral reserves.

The mineral resources for the Waterberg Project are categorized and reported in terms of NI 43-101 and are tabulated below.

Mineral Resource Estimate at 2.5 g/t 4E cut-off, effective September 4, 2019 on 100% Project basis:

T Zone at 2.5 g/t (4E) Cut-off

	Mineral	Cut-off	Tonnage	Grade							Metal
	Resource	4E		Pt	Pd	Rh	Au	4E	Cu	Ni	4E
	Category
	g/t	Tonnes	g/t	g/t	g/t	g/t	g/t	%	%	kg	Moz
	Measured2.5		4,443,483	1.17	2.12	0.05	0.87	4.20	0.150	0.080	18,663	0.600
	Indicated	2.5	17,026,142	1.37	2.34	0.03	0.88	4.61	0.200	0.094	78,491	2.524
	M+I	2.5	21,469,625	1.34	2.29	0.03	0.88	4.53	0.189	0.091	97,154	3.124
	Inferred	2.5	21,829,698	1.15	1.92	0.03	0.76	3.86	0.198	0.098	84,263	2.709

F Zone at 2.5 g/t (4E) Cut-off

9

PLATINUM GROUP METALS LTD.

(An Exploration and Development Stage Company) Supplementary Information and MD&A

For the year ended August 31, 2020

	Mineral	Cut-off		Tonnage		Grade																Metal
	Resource	4E			Pt		Pd		Rh		Au		4E		Cu		Ni		4E
	Category	g/t		Tonnes		g/t		g/t		g/t		g/t		g/t		%		%			kg		Moz
		Measured	2.5		54,072,600		0.95		2.20		0.05		0.16		3.36		0.087		0.202		181,704		5.842
		Indicated	2.5		166,895,635		0.95		2.09		0.05		0.15		3.24		0.090		0.186		540,691		17.384
		M+I	2.5		220,968,235		0.95		2.12		0.05		0.15		3.27		0.089		0.190		722,395		23.226
		Inferred	2.5		44,836,851		0.87		1.92		0.05		0.14		2.98		0.064		0.169		133,705		4.299
		Waterberg Aggregate Total 2.5 g/t (4E) Cut-off
		Mineral	Cut-off	Tonnage	Grade															Metal
		Resource	4E	Pt	Pd	Rh	Au	4E	Cu	Ni	4E
		Category	g/t	Tonnes	g/t	g/t	g/t	g/t	g/t	%	%		kg	Moz
		Measured	2.5	58,516,083	0.97	2.19		0.05	0.21	3.42	0.092	0.193		200,367	6.442
		Indicated	2.5	183,921,777	0.99	2.11		0.05	0.22	3.37	0.100	0.177		619,182	19.908
		M+I	2.5	242,437,860	0.98	2.13		0.05	0.22	3.38	0.098	0.181		819,549	26.350
		Inferred	2.5	66,666,549	0.96	1.92		0.04	0.34	3.27	0.108	0.146		217,968	7.008
	Mineral	Resource	Prill Split Waterberg Project Aggregate
	Pt					Pd						Rh					Au
	Category
				%					%						%					%
		Measured			28.2				64.4					1.5				5.9
		Indicated			29.4				62.6					1.5				6.5
		M+I			29.1				63.0					1.5				6.4
		Inferred			29.5				58.9					1.2				10.4

Notes:

1. 4E elements are platinum, palladium, rhodium and gold.
2. Cut-offsfor mineral resources were established by a QP after a review of potential operating costs and other factors.
3. Conversion factor used for kilograms ("kg") to ounces ("oz") is 32.15076
4. A 5% and 7% geological loss was applied to the measured/indicated and inferred mineral resources categories, respectively.
5. The mineral resources are classified in accordance with NI 43-101. Mineral resources that are not mineral reserves do not have demonstrated economic viability and inferred mineral resources have a high degree of uncertainty.
6. The mineral resources are provided on a 100% Project basis, inferred and indicated categories are separate and the estimates have an effective date of 4 September 2019.
7. Mineral resources were completed by Mr. CJ Muller of CJM Consulting.
8. Mineral resources were estimated using kriging methods for geological domains created in Datamine from 441 mother holes and 583 deflections. A process of geological modelling and creation of grade shells using indicating kriging was completed in the estimation process.
9. The mineral resources may be materially affected by metal prices, exchange rates, labour costs, electricity supply issues or many other factors detailed in the Company's 2018 Annual Information Form.
10. The data that formed the basis of the mineral resources estimate are the drill holes drilled by Platinum Group as project operator, which consist of geological logs, drill hole collars surveys, downhole surveys and assay data. The area where each layer was present was delineated after examination of the intersections in the various drill holes.
11. Numbers may not add due to rounding.

10

PLATINUM GROUP METALS LTD.

(An Exploration and Development Stage Company) Supplementary Information and MD&A

For the year ended August 31, 2020

Proven Mineral Reserve Estimate at 2.5 g/t 4E cut-off, effective September 4, 2019 on 100% Project basis:

	Proven Mineral Reserve Estimate at 2.5 g/t 4E cut-off
							Pt			Pd			Rh			Au			4E			Cu			Ni			4E Metal
	Zone			Tonnes			(g/t)			(g/t)			(g/t)			(g/t)			(g/t)			(%)			(%)			Kg			Moz
	T Zone	3,963,694		1.02		1.84		0.04		0.73		3.63		0.13		0.07		14,404		0.463
	F Central	17,411,606		0.94		2.18		0.05		0.14		3.31		0.07		0.18		57,738		1.856
	F South	-		-		-		-		-		-		-		-		-		-
	F North	16,637,670		0.85		2.03		0.05		0.16		3.09		0.10		0.20		51,378		1.652
	F Boundary North	4,975,853		0.97		2.00		0.05		0.16		3.18		0.10		0.22		15,847		0.509
	F Boundary South	5,294,116		1.04		2.32		0.05		0.18		3.59		0.08		0.19		19,020		0.611
	F Zone Total	44,319,244		0.92		2.12		0.05		0.16		3.25		0.09		0.20		143,982		4.629
	Waterberg Project			48,282,938			0.93			2.10			0.05			0.20			3.28			0.09			0.19			158,387			5.092
	Total

Probable Mineral Reserve Estimate at 2.5 g/t 4E cut-off, effective September 4, 2019 on 100% Project basis:
Probable Mineral Reserve Estimate at 2.5 g/t 4E cut-off
			Pt	Pd	Rh	Au	4E	Cu	Ni	4E Metal
Zone		Tonnes	(g/t)	(g/t)	(g/t)	(g/t)	(g/t)	(%)	(%)	Kg	Moz
T Zone		12,936,870	1.23	2.10	0.02	0.82	4.17	0.19	0.09	53,987	1.736
F Central		52,719,731	0.86	1.97	0.05	0.14	3.02	0.07	0.18	158,611	5.099
F South		15,653 ,961	1.06	2.03	0.05	0.15	3.29	0.04	0.13	51,411	1.653
F North		36,984,230	0.90	2.12	0.05	0.16	3.23	0.09	0.20	119,450	3.840
F Boundary North	13,312,581	0.98	1.91	0.05	0.17	3.11	0.10	0.23	41,369	1.330
F Boundary South	7,616,744	0.92	1.89	0.04	0.13	2.98	0.06	0.18	22,737	0.731
F Zone Total		126,287,248	0.91	2.01	0.05	0.15	3.12	0.08	0.18	393,578	12.654
Waterberg	Project	139,224,118	0.94	2.02	0.05	0.21	3.22	0.09	0.18	447,564	14.390
Total

Proven & Probable Mineral Reserve Estimate at 2.5 g/t 4E cut-off, effective September 4, 2019 on 100% Project basis:

Total Estimated Mineral Reserve at 2.5 g/t 4E cut-off

							Pt			Pd			Rh			Au			4E			Cu			Ni			4E Metal
	Zone			Tonnes			(g/t)			(g/t)			(g/t)			(g/t)			(g/t)			(%)			(%)			Kg			Moz
	T Zone	16,900,564		1.18		2.04		0.03		0.80		4.05		0.18		0.09		68,391		2.199
	F Central	70,131,337		0.88		2.02		0.05		0.14		3.09		0.07		0.18		216,349		6.956
	F South	15,653,961		1.06		2.03		0.05		0.15		3.29		0.04		0.13		51,411		1.653
	F North	53,621,900		0.88		2.09		0.05		0.16		3.18		0.10		0.20		170,828		5.492
	F Boundary North	18,288,434		0.98		1.93		0.05		0.17		3.13		0.10		0.23		57,216		1.840
	F Boundary South	12,910,859		0.97		2.06		0.05		0.15		3.23		0.07		0.19		41,756		1.342
	F Zone Total	170,606,492		0.91		2.04		0.05		0.15		3.15		0.08		0.19		537,560		17.283
	Waterberg Project			187,507,056			0.94			2.04			0.05			0.21			3.24			0.09			0.18			605,951			19.482
	Total

11

PLATINUM GROUP METALS LTD.

(An Exploration and Development Stage Company) Supplementary Information and MD&A

For the year ended August 31, 2020

Notes:

1. The estimated mineral reserves have an effective date of September 4, 2019.
2. A 2.5 g/t 4E stope cut-off grade was used for mine planning for the T Zone and the F Zone mineral reserves estimate. The cut- off grade considered April 2018 metal spot prices.
3. Tonnes and grade estimates include planned dilution, geological losses, external overbreak dilution, and mining losses.
4. 4E elements are platinum, palladium, rhodium and gold.
5. Numbers may not add due to rounding.

The Project financial performance has been estimated both at Spot Prices and at Three Year Trailing Average Prices as set out in the table below. The long-term real US$/Rand exchange rate for the Spot Price scenario is set at 15.00, which is based on an intra-day traded spot rate as of September 4, 2019. The US$/Rand exchange rates for the Three Year Trailing Price scenario, is based on Bloomberg's nominal consensus forward-curve as at June 2019, which translates into a long- term real US$/Rand rate of 15.95. The price deck assumptions for each scenario are tabled below.

Waterberg DFS Technical Report Price Deck Assumptions in $US

							Spot Prices			Three Year
	Parameter			Unit					Trailing Prices
					(Sept 4, 2019)
									(Sept 4, 2019)
	US$ / Rand (Long-term Real)		US$/Rand (Real July 2019)	15.00		15.95
	Platinum		US$/oz (Real July 2019)	980		931
	Palladium		US$/oz (Real July 2019)	1,546		1,055
	Gold		US$/oz (Real July 2019)	1,548		1,318
	Rhodium		US$/oz (Real July 2019)	5,036		1,930
	Basket Price (4E)		US$/oz (Real July 2019)	1,425		1,045
	Copper		US$/lb (Real July 2019)	2.56		2.87
	Nickel		US$/lb (Real July 2019)	8.10		5.56
	Smelter Payability: 4E Metal		% Gross Sale Value	85%		85%
	Smelter Payability: Copper		% Gross Sale Value	73%		73%
	Smelter Payability: Nickel		% Gross Sale Value	68%		68%

Readers are directed to review the full text of the DFS Technical Report, available for review under the Company's profile on SEDAR at www.sedar.comand on EDGAR at www.sec.govfor additional information.

The known deposit strike length on the Waterberg Project is 13 km long so far, remains open along strike and begins from a depth of 140 meters vertical. The Waterberg DFS mine plan covers a strike length of approximately 8.5 km. The deposit is known to continue down dip below the arbitrary 1,250 meter cut off depth applied to the deposit for resource estimation purposes. The Waterberg Project and the deposit is still open for expansion. Based on airborne gravity surveys and drilling completed to date, additional drilling northward along strike is recommended for the future.

As a result of its shallow depth, good grade and a fully mechanized mining approach, the Waterberg Project can be a safe mine within the lowest quartile of the Southern Africa platinum group element industry cost curve.

The Waterberg DFS mine plan models production at 4.8 million tonnes of ore per annum and 420,000 4E ounces per year in concentrate. The mine initially accesses the orebody using two sets of twin decline tunnels with mining by fully mechanised long hole stoping methods with paste backfill. Paste backfill allows for a high mining extraction ratio as mining can be completed next to backfilled stopes without leaving internal pillars. Maintaining safety and reliability were key mine design criteria. As a result of the scale of the orebody, bulk mining on 20 to 40 meter sublevels with large underground equipment and conveyors for ore and waste transport provides high efficiency. Many of the larger successful underground mines in the world use the same method of mining with backfill and estimated costs were benchmarked against many of these operations.

12

PLATINUM GROUP METALS LTD.

(An Exploration and Development Stage Company) Supplementary Information and MD&A

For the year ended August 31, 2020

Mining Right

1. formal Mining Right Application ("MRA") for the Waterberg Project, including a Social and Labour Plan ("SLP"), was accepted by the South African Department of Mineral Resources and Energy ("DMR") on September 14, 2018. The
   Company held local public meetings on numerous occasions in advance of the MRA. A program of public consultation as part of the formal MRA and Environmental Authorisation applications for the Project was completed in August 2019. The Environmental Impact Assessment and Environmental Management Program were filed with the DMR on August 15, 2019. An Environmental Authorization was granted for the Waterberg Project on August 12, 2020, subject to a public notice period and finalization of issues raised by affected parties, which process was completed with the issue of the final EA on November 10, 2020.

Training for a new mechanised mining workforce is an important part of the Waterberg DFS and the MRA. Planning has been undertaken with the assistance of global mine training leader, Norcat, of Sudbury, Ontario. The Waterberg DFS modelled a significant investment in training, focussed on the immediate area of the Project, working in co-operation with local colleges and facilities.

All the above work forms a part of the MRA. Notwithstanding delays from previous guidance as a result of South African stay at home orders and regulations in 2020 aimed at halting the spread of the COVID-19 virus, a decision by the DMR regarding the grant of the Waterberg Mining Right is expected in late 2020 or early 2021.

Infrastructure planning and option assessments were components of the 2020 Work Program. Detailed hydrological work studying the utilization of known sources for significant volumes of ground water has been conducted. In 2018 a cooperation agreement was entered between Waterberg JV Co. and the local Capricorn Municipality for the development of water resources to the benefit of local communities and the mine. Hydrological work has also identified several large-scale water basins that are likely able to provide mine process and potable water for the Waterberg Project and local communities. Test drilling of these water basins has been completed resulting in the identification of sufficient water supply for the mine. An earlier drilling program conducted by the Capricorn District Municipality identified both potable and high mineral unpotable water resources in the district. Drilling by Waterberg JV Co. has identified some potable water resources. Several boreholes proximal to the Waterberg Project identified large volumes of high mineral unpotable water not suitable for agriculture. Hydrological and mill process specialists have tested the use of this water as mine process water. In general, ground water resources identified proximal to the Waterberg Project have the potential for usage for both mining and local communities. Further water definition work and drilling is planned.

The establishment of servitudes for power line routes and detailed planning and permitting for an Eskom electrical service to the project are also advancing. Power line environmental and servitude work is being completed by TDxPower in coordination with Eskom. TDxPower has progressed electrical power connection planning for approximately a 70 km, 137MvA line to the project. Engineering refinement of steady state power requirements has resulted in a reduced demand of approximately 90MvA at steady state. Bulk power design and costing work for steady state requirements has commenced. Eskom is engaged with project engineers to determine electrical power sources and availability. A temporary power line for the construction period from the nearby grid at Bochum is being designed and costed. Community engagement regarding power line routes and completion of an environmental impact assessment is in process.

Subsequent to Implats June 15, 2020 formal notice that they do not intend to exercise their Purchase and Development Option, the Company and Waterberg JV Co. have begun a process to assess commercial alternatives for mine development financing and concentrate offtake. Several parties are currently in discussions with the Company. The Implats Offtake ROFR requires that any offtake arrangement with Implats at least match any bona fide third party commercial offtake terms offered. Concentrate offtake negotiations with Implats also continue.

History of Acquisition

The Waterberg JV Project is comprised of adjacent, granted and applied for prospecting rights and applied for Mining Rights with a combined active project area of approximately 81,329.60 ha, located on the Northern Limb of the Bushveld Complex, approximately 85 km north of the town of Mokopane (formerly Potgietersrus). The Waterberg Project is comprised of the former Waterberg JV Property and the Waterberg Extension Property.

Prospecting rights in South Africa are valid for a period of five years, with one renewal of up to three years. Furthermore,

13

PLATINUM GROUP METALS LTD.

(An Exploration and Development Stage Company) Supplementary Information and MD&A

For the year ended August 31, 2020

the MPRDA provides for a retention period after prospecting of up to three years with one renewal of up to two years, subject to certain conditions. The holder of a prospecting right granted under the MPRDA has the exclusive right to apply for and, subject to compliance with the requirements of the MPRDA, to be granted, a Mining Right in respect of the prospecting area in question.

On September 28, 2009, PTM RSA, JOGMEC and Mnombo entered into a joint venture agreement, as later amended on May 20, 2013 (the "JOGMEC Agreement") whereby JOGMEC could earn up to a 37% participating interest in the Waterberg JV Project for an optional work commitment of $3.2 million over four years, while at the same time Mnombo could earn a 26% participating interest in exchange for matching JOGMEC's expenditures on a 26/74 basis ($1.12 million).

On November 7, 2011, the Company executed an agreement with Mnombo to acquire 49.9% of the issued and outstanding shares of Mnombo in exchange for cash payments totaling R1.2 million and an agreement that the Company would pay for Mnombo's 26% share of costs on the Waterberg JV Project until the completion of the Waterberg DFS.

On May 26, 2015, the Company announced a second amendment to the JOGMEC Agreement (the "2nd Amendment") whereby the Waterberg JV Project and the Waterberg Extension Project were to be consolidated and contributed into operating company, Waterberg JV Co. The transfer of Waterberg prospecting rights into Waterberg JV Co pursuant to the 2nd Amendment was given section 11 approval by the DMR in August 2017 and the transfer was completed on September 21, 2017. This transaction was considered a taxable item in South Africa, that was offset with other tax-deductible losses and utilization of unrecognized taxable losses. Under the 2nd Amendment, JOGMEC committed to fund $20 million in expenditures over a three-year period ending March 31, 2018. The Company remained the Project operator under the 2nd Amendment.

On March 8, 2018, JOGMEC announced that it had signed a memorandum of understanding with HANWA Co., Ltd ("HANWA") to transfer 9.755% of its 21.95% interest in Waterberg JV Co. to HANWA, which was the result of HANWA winning JOGMEC's public tender held on February 23, 2018. In March 2019, the South African government approved this transaction and the entire transfer process has been completed. Under the terms of the transaction, Hanwa has also acquired the marketing right to solely purchase all the metals produced from the Waterberg Project at market prices.

3. DISCUSSION OF OPERATIONS AND FINANCIAL CONDITION

1. Liquidity, Capital Resources and Going Concern

Share Consolidation

On November 20, 2018, the Company announced a consolidation of its common shares based on one new share for ten old shares (1:10), effective at 9:00 a.m. (New York time) on December 13, 2018 (the "2018 Share Consolidation"). All share, stock option, warrant and per share numbers reported in this MD&A are on a post 2018 Share Consolidation basis, unless otherwise noted.

The Company's consolidated common shares began trading on the Toronto Stock Exchange and NYSE American when the markets opened on December 17, 2018. The purpose of the consolidation was to increase the Company's common share price to be in compliance with the NYSE American's low selling price requirement. All share, stock option, warrant and per share numbers reported in this MD&A are on a post-consolidation basis unless otherwise noted.

Recent Equity Financings

On October 15, 2020, the Company announced it had closed a non-brokered private placement with to Deepkloof Limited ("Deepkloof"), a subsidiary of Hosken Consolidated Investments Limited ("HCI"). An aggregate of 1,146,790 shares were issued for US$2.18 per share resulting in gross proceeds of $2.5 million to the Company. Closing the private placement allowed the HCI to maintain a greater than 31% interest in the Company.

On September 4, 2020, the Company announced it had entered into an At-The-Market-Offering-Sales-Agreement ("2020 ATM") with BMO Capital Markets. Under the sales agreement the Company may sell its common shares from time to time for up to $12 million in aggregate sales proceeds in "at the market" transactions. At the conclusion of the trading day on November 24, 2020, the Company had sold 4,617,177 common shares at an average price of $2.16 for gross proceeds of $10 million pursuant to the 2020 ATM.

14

PLATINUM GROUP METALS LTD.

(An Exploration and Development Stage Company) Supplementary Information and MD&A

For the year ended August 31, 2020

On June 17, 2020, the closed a non-brokered private placement of 1,221,500 shares at a price of US$1.40 for gross proceeds of $1.7 million. A 6% finders fee of $37,926 was paid in cash on a portion of the private placement.

On December 19, 2019, the Company closed a non-brokered private placement of 3,225,807 shares at a price of US$1.24 for gross proceeds of $4.0 million. A 6% finders fee of $54,232 was paid on a portion of the private placement.

On August 21, 2019, the Company closed a bought deal financing of 8,326,957 common shares at a price of US$1.25 per share for gross proceeds of $10.4 million. Also, on August 21, 2019 the Company announced the sale of 7,575,758 common shares to LMM and 6,940,000 common shares to HCI both at a price of US$1.32 per share for gross proceeds of $10.0 million and $9.2 million respectively. Total fees of $1,769 were paid on the August 21, 2019 transactions including a 6% finders fee of $624.

On June 28, 2019, the Company closed a non-brokered private placement with HCI for gross proceeds of $1.3 million. In connection with the private placement, the Company issued an aggregate of 1,111,111 common shares to Deepkloof at a price of US$1.17 per common share. On a non-diluted basis and after giving effect to the private placement, HCI's ownership in the Company was increased from 20.05% to 22.60% of the Company's issued and outstanding common shares. The Company did not pay any finder's fees in connection with the private placement.

On June 20, 2019 HCI increased its ownership interest in the Company as a result of the exercise of certain common share purchase warrants to purchase 80,000 common shares at US$1.70 per common share. Following the warrant exercise, HCI beneficially held 6,782,389 common shares of the Company, representing 20.05% of the Company's issued and outstanding common shares as of June 20, 2019.

During the year ended August 31, 2019 the Company received $1.7 million from the early exercise of common share purchase warrants and issued 1,026,270 common shares at a price of US$1.70 each. In fiscal 2020, the Company received $47,668 from the issue of 28,040 shares pursuant to the exercise of common share purchase warrants. All remaining $1.70 warrants have since expired on November 22, 2019.

On February 4, 2019, the Company announced it had closed a non-brokered private placement of 3,124,059 common shares at a price of $1.33 per share to raise gross proceeds of $4.16 million. A 6% finders fee of $72,000 was paid on a portion of the private placement, with total issuance costs (including the finders fee) totalling $107,000.

The following is a reconciliation for the use of proceeds from recent financings to August 31, 2020 (in thousands of dollars):

								Actual
								Use of
	February	June 28,	August		Dec 19,	June 17,		Proceeds
	4, 2019	2019	21, 2019	August	2019	2020		to
Use of	Private	Private	Private	21, 2019	Private	Private	Aggregate	Aug 31,
Proceeds	Placement	Placement	Placement	Offering	Placement	Placement	Proceeds	2020
Repayment	$0	$0	$13,000	$10,000	$0	$0	$23,000	$23,000
of the LMM
Facility and
termination
fees.
General	$4,048	$1,300	$6,161	$409	$3,946	$1,710	$17,574	$19,283
corporate
purposes
TOTAL	$4,048	$1,300	$19,161	$10,409	$3,946	$1,710	$40,574	$42,283

Convertible Senior Subordinated Notes

On June 30, 2017, the Company issued and sold to certain institutional investors $20 million aggregate principal amount of 6 7/8% convertible senior subordinated notes due 2022 (the "Notes"). The net proceeds from the offering of Notes were

15

PLATINUM GROUP METALS LTD.

(An Exploration and Development Stage Company) Supplementary Information and MD&A

For the year ended August 31, 2020

used primarily to fund direct expenditures relating to the operation, closure and care and maintenance of the Maseve mine until completion of the sale of the Maseve mine. The Notes bear interest at a rate of 6 7/8% per annum, payable semi- annually on January 1 and July 1 of each year, beginning on January 1, 2018, in cash or at the election of the Company, in common shares of the Company or a combination of cash and common shares, and will mature on July 1, 2022, unless earlier repurchased, redeemed or converted. An additional interest charge of 0.25% for the period January 1, 2018 to March 31, 2018, plus a further 0.25% for the period April 1, 2018 to July 1, 2018, was added to the coupon rate of the Notes at the Company's election to not file a prospectus and a registration statement for the Notes with Canadian securities regulatory authorities and with the U.S. Securities and Exchange Commission. After July 1, 2018, at which time the Notes became freely tradable by holders other than affiliates, the Notes once again bear interest at the coupon rate of 6 7/8% per annum.

Subject to certain exceptions, the Notes will be convertible at any time at the option of the holder, and may be settled, at the Company's election, in cash, common shares, or a combination of cash and common shares. If any Notes are converted on or prior to the three and one-half year anniversary of the issuance date, the holder of the Notes will also be entitled to receive an amount equal to the remaining interest payments on the converted Notes to the three and one-half year anniversary of the issuance date, discounted by 2%, payable in common shares. The initial conversion rate of the Notes was 1,001.1112 common shares (on a pre-consolidation basis) per $1,000 principal amount of Notes, which was equivalent to an initial conversion price of approximately $0.9989 per common share (on a pre-consolidation basis), representing a conversion premium of approximately 15% above the NYSE American closing sale price for the Company's common shares of $0.8686 per share on June 27, 2017. After giving effect to the 2018 Share Consolidation, the conversion rate is 100.1111 per $1,000 which is equivalent to a conversion price of approximately $9.989 per common share. The conversion rate will be subject to adjustment upon the occurrence of certain events. If the Company pays interest in common shares, such shares will be issued at a price equal to 92.5% of the simple average of the daily volume-weighted average price of the common shares for the 10 consecutive trading days ending on the second trading day immediately preceding the payment date, on the NYSE American exchange or, if the common shares are not then listed on the NYSE American exchange, on the principal U.S. national or other securities exchange or market on which the common shares are then listed.

Notwithstanding the foregoing, no holder will be entitled to receive common shares upon conversion of Notes to the extent that such receipt would cause the converting holder or persons acting as a "group" to become, directly or indirectly, a "beneficial owner" (as defined in the indenture governing the Notes (the "Indenture")) of more than 19.9% of the common shares outstanding at such time or, in the case of a certain note holder, if it or its affiliates would become a "beneficial owner" of more than 4.9% of the common shares outstanding at such time. In addition, the Company will not issue an aggregate number of common shares pursuant to the Notes that exceeds 19.9% of the total number of common shares outstanding on June 30, 2017, which was 14,845,619. As of the date of this MD&A, the Company has issued a total of 2,592,966 common shares pursuant to conversions of and interest payments on the Notes, leaving approximately 361,312 common shares eligible for issuance pursuant to further interest payments or conversions. Any payments in excess of such amounts must be made in cash, which will have an adverse effect on the Company's cash flows.

After July 1, 2020, until the maturity date, the Company has the right to redeem all or part of the outstanding Notes at a price, payable in cash, of 100% of the principal amount of the Notes to be redeemed, plus accrued and unpaid interest, if any, to, but excluding, the redemption date.

Upon the occurrence of a fundamental change as defined in the Indenture, the Company must offer to purchase the outstanding Notes at a price, payable in cash, equal to 100% of the principal amount of the Notes, plus accrued and unpaid interest, if any.

The Notes are unsecured senior subordinated obligations and are subordinated in right of payment to the prior payment in full of all the Company's existing and future senior indebtedness pursuant to the Indenture. The Company may issue additional Notes in accordance with the terms and conditions set forth in the Indenture. The Indenture contains certain additional covenants, including covenants restricting asset dispositions, issuances of capital stock by subsidiaries, incurrence of indebtedness, business combinations and share exchanges.

Effective January 1, 2020 the Company issued 517,468 common shares in settlement of $687,156 of bi-annual interest payable on $19.99 million of outstanding Notes. Also, effective July 2, 2020 the Company issued 526,741 common shares in settlement of $687,156 of bi-annual interest payable on $19.99 million of outstanding Notes. The common shares issued were priced based on a simple average of their daily volume weighted average price for ten consecutive trading days, ending on the second trading day immediately preceding the payment date, multiplied by 92.5%.

16

PLATINUM GROUP METALS LTD.

(An Exploration and Development Stage Company) Supplementary Information and MD&A

For the year ended August 31, 2020

Sprott Facility

On August 14, 2019, the Company entered into the Sprott Facility, pursuant to which the Sprott Lenders advanced $20 million bearing interest at 11% per annum, compounded monthly. Monthly interest payments totaling $2.2 million were paid to Sprott in fiscal 2020, with a further $0.4 million in interest paid subsequent to year end. The loan is due August 14, 2021 with the Company holding the option to extend the maturity date by one year in exchange for a payment in common shares or cash equal to three percent of the outstanding principal amount. The Company is required to maintain certain minimum working capital and cash balances under the Sprott loan.

The Sprott Facility requires that a cash sweep of 50% of the Company's net proceeds from equity offerings or new debt securities be applied to repayment of the Sprott Facility. However, Sprott will only require that 50% of the net proceeds of the 2020 ATM, plus the net proceeds from any concurrent equity offering or private placement, in excess of $1,000,000 be applied to the Sprott Facility, and for net proceeds in excess of $2,000,000, 25% is to be applied to repayment of the Sprott Facility and 12.5% be paid to Macquarie Capital Markets Canada Ltd. ("Macquarie") in payment of outstanding 2017 bank advisory fees ("Bank Advisory Fees"), as described below. After payment of the Macquarie Bank Advisory Fees the cash sweep payable to Sprott will return to 50%. On November 3, 2020 the principal balance of the Sprott Facility was paid down by $1.88 million to an aggregate amount due of $18.12 million.

Bank Advisory Fees

BMO Nesbitt Burns Inc. ("BMO") and Macquarie have provided strategic advisory services to the Company. Effective October 22, 2018 the formal agreement between the Company and Macquarie was terminated by mutual consent. Pursuant to the Maseve Sale Transaction and the Implats Transaction, BMO and Macquarie earned aggregate fees of approximately $3.8 million. In October 2017, the Company paid BMO and Macquarie an aggregate of $1.0 million after the closing of the Implats Transaction of the Implats Transaction and also agreed to pay them an aggregate balance of approximately $2.9 million for their strategic advisory fees earned, as soon as practicable following the final repayment of all secured debt. On November 3, 2020, the balance of past advisory fees due to BMO and Macquarie were paid down equally by an aggregate $1.38 million, leaving an aggregate amount due of $1.51 million.

Going Concern

The Company currently has limited financial resources. The Company incurred a loss of $7.1 million during the year ended August 31, 2020 and used cash in operating activities of $3.1 million. The Company had a working capital deficit of $2.4 million at August 31, 2020 and was indebted $20 million pursuant to the Sprott Facility. As of the date of this MD&A the Sprott Facility was paid down to $18.12 million. This debt is due August 14, 2021, subject to the Company's option to extend the maturity date by one year in exchange for a payment in common shares or cash of three percent of the outstanding principal amount. The Company has no sources of operating income at present. The Company's ability to continue operations in the normal course of business will depend upon its ability to secure additional funding by methods which could include debt refinancing, equity financing, sale of assets and strategic partnerships. The Company will continue to work closely with its major shareholders and lenders. Management believes the Company will be able to secure further funding as required although there can be no assurance that these efforts will be successful. Material uncertainties exist resulting in substantial doubt as to the ability of the Company to continue to meet its obligations as they come due and hence, the ultimate appropriateness of the use of accounting principles applicable to a going concern.

Contractual Obligations

The following table discloses the Company's contractual obligations as at August 31, 2020 (in thousands of dollars):

Payments Due By Year

		< 1 Year		1 - 3 Years		4 - 5 Years	> 5 Years			Total
Lease Obligations	$	103	$	168	$	42	$	-	$	313
Notes1		1,374		21,364		-		-		22,738
Sprott Facility		22,726		-		-		-		22,726
Totals	$	24,203	$	21,532	$	42	$	-	$	45,777

T1Subject to certain limitations, the Notes and related interest may be settled in cash or common shares of the Company.

17

PLATINUM GROUP METALS LTD.

(An Exploration and Development Stage Company) Supplementary Information and MD&A

For the year ended August 31, 2020

Other contingencies: Refer to section 8 below - Risk factors

Accounts Receivable and Payable

Accounts receivable at August 31, 2020 totaled $0.2 million (August 31, 2019 - $0.5 million) being comprised mainly of South African value added taxes refundable.

Accounts payable and accrued liabilities at August 31, 2020, totaled $1.4 million (August 31, 2019 - $4.0 million) mainly comprising of payables related to the Waterberg Project.

1. Results of Operations

Year Ended August 31, 2020

For the year ended August 31, 2020, the Company incurred a net loss of $7.1 million (August 31, 2019 - net loss of $16.7 million). The loss in the current period is lower in part due to a gain recognized on the fair value movement of derivatives and warrants of $3.2 million in the current year (August 31, 2019 - $2.7 million loss). The gain results from warrants valued at $3.0 million at August 31, 2019 expiring during fiscal 2020. Interest in the current period ($5.5 million) dropped as compared to the previous comparable period (August 31, 2019 - $8.3 million) due to lower debt levels in 2020. Also, in the previous comparable period a gain of $0.6 million was recognized on the value of marketable securities held by the Company, whereas no marketable securities were held in the current period. The currency translation adjustment recognized in the period was a loss of $4.5 million (August 31, 2019 - $0.1 million gain) due to the Rand decreasing in value in the current year relative to the US Dollar.

Three Month Period Ended August 31, 2020

For the three-month period ended August 31, 2020, the Company incurred a net loss of $1.2 million (August 31, 2019 - net loss of $3.5 million). The smaller loss in the current period is due to a foreign exchange gain of $1.9 million ($1.1 gain August 31, 2019). This foreign exchange gain is due to the increased value of the Canadian Dollar relative to the U.S. Dollar in the current period. During the previous comparable period a loss of $1.8 million was recognized on the revaluation of warrants, whereas there were no warrants outstanding during the current period. The currency translation adjustment recognized in the period is a loss of $0.4 million (August 31, 2019 - $2.3 million loss) due to the Rand decreasing in value relative to the U.S. Dollar.

Quarterly Financial Information

The following tables set forth selected quarterly financial data for each of the last eight quarters (In thousands of dollars, except for share data):

Quarter ended		Aug. 31,		May 31,		Feb. 29,		Nov. 30,
		2020		2020		2020		2019
Net finance income(1)	$	24	$	28	$	43	$	63
Net (earnings) loss(2)		1,230		3,352		3,100		(554)
Basic (earnings) loss per share(3)		0.02		0.05		0.05		(0.01)
Total assets(2)		37,415		40,545		41,140		41,769

Quarter ended		Aug. 31,		May 31,		Feb. 28,		Nov. 30,
		2019		2019		2019		2018
Net finance income(1)	$	26	$	18	$	43	$	277
Net loss(2)		3,639		3,682		3,815		5,640
Basic loss per share(3)		0.10		0.11		0.11		0.19
Total assets(2)		43,633		38,321		40,038		46,225

Notes:

1. The Company earns income from interest bearing accounts and deposits. Rand balances earn much higher rates of interest than can be earned at present in Canadian or U.S. Dollars. Interest income varies relative to cash on hand.

18

PLATINUM GROUP METALS LTD.

(An Exploration and Development Stage Company) Supplementary Information and MD&A

For the year ended August 31, 2020

1. Net loss by quarter and total assets are affected by the timing and recognition of one-off large transactions. In November 2019, the Company incurred a gain of $3.1 million on the cancellation of expired warrants. In November 2018 the Company recovered some care and maintenance costs relating to the closure of the Maseve Mine.
2. Basic (gain) loss per share is calculated using the weighted average number of common shares outstanding. The Company uses the treasury stock method to calculate diluted earnings per share. Diluted per share amounts reflect the potential dilution that could occur if securities or other contracts to issue common shares were exercised or converted to common shares. In periods when a loss is incurred, the effect of share issuances under options would be anti-dilutive, resulting in basic and diluted loss per share being the same.

Annual Financial Information (in thousands of dollars, except for share data)

	Year ended	Year ended	Year ended
	August 31, 2020	August 31, 2019	August 31, 2018
Interest Income	$158(1)	$364(1)	$739(1)
Net loss	$7,128(2)	$16,776(2)	$41,024(2)
Basic loss per share	$0.11(3)	$0.52(3)	$2.03(3)
Diluted loss per share	$0.11(3)	$0.52(3)	$2.03(3)
Total assets	$37,415	$43,706	$41,849
Long term debt	$19,337	$21,560	$42,291
Notes	$17,212	$18,785	$14,853
Dividends	Nil	Nil	Nil

Notes:

1. The Company's only significant source of income during the years ending August 31, 2018 to 2020 was interest income from interest bearing accounts held by the Company.
2. Net loss was affected in 2018 by closure care and maintenance costs on the Maseve Mine.
3. Basic loss per share is calculated using the weighted average number of common shares outstanding. The Company uses the treasury stock method for the calculation of diluted earnings per share. Diluted per share amounts reflect the potential dilution that could occur if securities or other contract to issue common shares were exercised or converted to common shares. In periods where a loss is incurred, the effect of potential issuances of shares under options and share purchase warrants would be anti-dilutive, and accordingly basic and diluted loss per share are the same. On December 31, 2018 the Company announced that effective December 17, 2018 its common shares would be consolidated on the basis of one new share for ten old shares (1:10). All information regarding the issued and outstanding common shares, options and weighted average number and per share information has been retrospectively restated to reflect the fiscal 2019 ten to one consolidation.

4. Dividends

The Company has never declared nor paid dividends on its common shares. The Company has no present intention of paying dividends on its common shares, as it anticipates that in the foreseeable future all available funds will be invested to finance its business. The Company does intend to consider a dividend policy upon the successful establishment of positive cash flow.

5. Related Party Transactions

Transactions with related parties are as follows (in thousands of dollars):

1. During the year ended August 31, 2020 $313 ($326 - August 31, 2019) was paid or accrued to independent directors for directors' fees and services.
2. During the year ended August 31, 2020, the Company was paid or accrued payments of $54 ($54 - August 31, 2019) from West Vault Mining Inc. ("West Vault", formerly West Kirkland Mining Inc.), a company with two directors in common, for accounting and administrative services.
3. In fiscal 2018, Company closed a private placement with Deepkloof whereby HCI acquired a right to nominate one person to the board of directors of the Company and a right to participate in future equity financings of the Company to maintain its pro-rata interest. HCI has exercised its right to nominate one person to the board of directors. In February, August and December 2019, then June and October 2020 through private placements Deepkloof subscribed for 2,141,942, 6,940,000, 612,931, 500,000 and 1,146,790 shares respectively. At August 31, 2020 HCI's total ownership interest was approximately 31.33% and as of the date of this MD&A is approximately 30.42%.

19

PLATINUM GROUP METALS LTD.

(An Exploration and Development Stage Company) Supplementary Information and MD&A

For the year ended August 31, 2020

All amounts receivable and accounts payable owing to or from related parties are non-interest bearing with no specific terms of repayment. These transactions are in the normal course of business and are recorded at consideration established and agreed to by the parties.

Key Management Compensation

The remuneration the CEO, CFO and other key management personnel and the directors during the years ended August 31, 2020 to 2018 is as follows:

Year ended	August 31, 2020	August 31, 2019	August 31, 2018
Salaries	$	916	$	927	$	963
Directors fees		261		171		184
Share-based payments - management		907		393		13
Share-based payments - directors		52		155		12
Total	$	2,136	$	1,646	$	1,172

6. Off-Balance Sheet Arrangements

The Company does not have any special purpose entities nor is it party to any off-balance sheet arrangements.

7. Outstanding Share Data

The Company has an unlimited number of common shares authorized for issuance without par value. At August 31, 2020, there were 64,095,073 common shares outstanding and 3,182,500 incentive stock options outstanding. At November 25, 2020 69,788,247 shares are outstanding.

Compliance with NYSE American Listing Requirements

On May 23, 2018 and on April 10, 2019 the Company received letters from NYSE American stating that it was not in compliance with the continued listing standards as set forth in Sections 1003(a)(i), 1003(a)(ii) and 1003(a)(iii) of the NYSE American Company Guide (the "Company Guide") with respect to stockholders' equity, or in Section 1003(f)(v) of the Company Guide with respect to the selling price of the Company's Common Shares.

The Company regained compliance with Section 1003(f)(v) of the Company Guide subsequent to the 2018 Share Consolidation. On October 10, 2019, the NYSE American confirmed that the Company had resolved its listing deficiency with respect to Section 1003(a) and successfully regained compliance with the NYSE American's continued listing standards.

8. Risk Factors

The Company is subject to a number or risks and uncertainties, each of which could have an adverse effect on results, business prospects or financial position. For a comprehensive list of the risks and uncertainties affecting our business, please refer to the section entitled "Risk Factors" in the Company's 20-F, which was also filed as the Company's form of AIF, and as well as in the documents incorporated by reference therein. The 2020 20-F may be found on EDGAR at www.sec.gov and the AIF may be found on SEDAR at www.sedar.com. Certain risk factors are discussed below in more detail.

Impact of COVID-19

In December 2019, a novel strain of coronavirus known as SARS-CoV-2 which is responsible for the coronavirus disease known as COVID-19 surfaced in Wuhan, China and has spread around the world, with resulting business and social disruption. COVID-19 was declared a worldwide pandemic by the World Health Organization on March 11, 2020. The speed and extent of the spread of COVID-19, and the duration and intensity of resulting business disruption and related financial and social impact, are uncertain. Further, the extent and manner to which COVID-19, and measures taken by governments,

20

PLATINUM GROUP METALS LTD.

(An Exploration and Development Stage Company) Supplementary Information and MD&A

For the year ended August 31, 2020

the Company or others to attempt to reduce the spread of COVID-19, may affect the Company and cannot be predicted with certainty.

COVID-19 and the related measures taken by government have had and may continue to have an adverse impact on many aspects of the Company's business including, employee health, workforce productivity and availability, travel restrictions, contractor availability, supply availability, the Company's ability to maintain its controls and procedures regarding financial and disclosure matters and the availability of insurance and the costs thereof, some of which, individually or when aggregated with other impacts, may be material to the Company.

With effect from March 26, 2020 the Government of South Africa ordered a hard national lockdown until April 21, 2020, where all residents of South Africa could only leave their residence under strictly controlled circumstances (e.g. to buy food, seek medical assistance) in order to address the COVID-19 pandemic. The hard lockdown was thereafter extended to April 30, 2020. Currently, South Africa is under a phased risk-alert lockdown process, with Level 5 being the hard, drastic lockdown that was imposed during April 2020 and Level 1 being a return to normalcy, but retaining the use of masks, sanitisers and social distancing. Level 1 was re-implemented on September 21, 2020. The relaxation of the hard lockdown has seen the number of infections increasing and accelerating in South Africa. The Company cannot provide any assurances that governments in Canada or South Africa will not implement measures that result in suspension or reduction of development operations at Waterberg or other projects the Company is involved in.

In addition, the actual or threatened spread of COVID-19 globally, and responses of governments and others to such actual or threatened spread, could also have a material adverse effect on the global economy, could continue to negatively affect financial markets, including the price of palladium and platinum and the trading price of the Company's shares, could adversely affect the Company's ability to raise capital, and could cause continued interest rate volatility and movements that could make obtaining financing or refinancing debt obligations more challenging or more expensive. Furthermore, with regard to the Company, the COVID-19 pandemic and the measures implemented for the prevention, mitigation and management thereof may result in delays in the grant of the Waterberg mining right application or environmental authorisation, or any other authorisations and permits required for the Waterberg Project by reason of regulatory officials not being available, the restriction on the movement of persons to conduct inspections and site visits and the inability to meet with community consultative forums.

Africa Wide

On September 20, 2018, the Company reported receipt of a summons issued by Africa Wide, formerly the holder of a 17.1% interest in Maseve, commencing legal proceedings in South Africa against PTM RSA, RBPlat and Maseve in relation to the Maseve Transaction. Africa Wide is seeking to set aside the closed Maseve Transaction. On an exception application, RBPlat successfully challenged, with costs, Africa Wide's claim on the grounds that its particulars of claim were vague and embarrassing and/or lacked averments necessary to sustain a cause of action. Africa Wide was given leave to amend its particulars of claim and filed amended particulars of claim on April 17, 2019.

On May 9, 2019, PTM filed notice in the High Court requiring Africa Wide to produce those agreements and documents upon which it has based its claim. Africa Wide responded to the effect that the requested documentation was either in our possession or not required for the defendants to plead. We filed a plea of our defences to Africa Wide's claims on July 19, 2019. RBPlat and Maseve likewise filed pleas of their defences on the same date. All of the defendants, when so doing, also raised a special plea of non-joinder, on the basis that Africa Wide has not, on its own version of the facts and events contended for, joined all parties to the proceedings who have a direct and substantial interest in the relief that Africa Wide seeks. After initially resisting these special pleas, Africa Wide has subsequently conceded the need to join additional defendants. Pursuant to bringing a joinder application, Africa Wide has made further amendments to its particulars of claim.

While both the Company and RBPlat believe, after receiving legal advice, that the Africa Wide action, as amended, remains procedurally, factually and legally defective in certain material respects, no assurance can be provided that we will prevail in this action. If Africa Wide were successful, it could have a material adverse effect on the Company.

Tax Audit South Africa

During the 2014, 2015 and 2016 fiscal years, PTM RSA claimed unrealized foreign exchange losses as income tax deductions in its South African corporate tax returns in the amount of Rand 1.4 billion. The exchange losses emanate from a Canadian dollar denominated shareholder loan advanced to PTM RSA. Under applicable South African tax legislation,

21

PLATINUM GROUP METALS LTD.

(An Exploration and Development Stage Company) Supplementary Information and MD&A

For the year ended August 31, 2020

exchange losses can be claimed if the shareholder loan is a current liability as determined by IFRS. For the years in question, the intercompany debt was classified as current in PTM RSA's stand alone audited financial statements.

During 2018, the South African Revenue Service ("SARS") conducted an income tax audit of the 2014 to 2016 years of assessment and issued PTM RSA with a letter of audit findings on November 5, 2018 proposing that the exchange losses be disallowed on the basis that the shareholder loan was not a current liability. The Company and its advisors responded to SARS during 2019 and refuted the issues raised.

On June 30, 2020 the Company received a letter from SARS reporting the finalization of the above income tax audit with no reassessment or adjustment to the Company's tax returns for the three years audited.

9. Outlook

The Company's key business objective is to advance the palladium dominant Waterberg Project to a development and construction decision. The next major milestone for the Company is the grant of a Mining Right for the project. Although platinum demand and pricing has been stagnant in recent years, the markets for palladium, gold and rhodium have improved in 2019 and 2020, resulting in a higher overall 4E metal basket price. We expect a strong forward market for palladium and rhodium based on the trend of increasing car sales in China where the largest amount of palladium and rhodium are used.

The Company continues to work on advancing project permitting, infrastructure servitudes and community relationships with its partners Implats, JOGMEC, Hanwa and Mnombo through a technical committee of Waterberg JV Co. The Company and Waterberg JV Co. have begun a process to assess commercial alternatives for mine development financing and concentrate offtake. Several parties are currently in discussions with the Company. The Implats Offtake ROFR allows Implats the opportunity to match any offtake terms offered by a bona fide third party. Concentrate offtake discussions and negotiations with Implats also continue.

The Company's battery technology initiative through Lion with AAP represents an exciting opportunity in the high-profile lithium battery research and innovation field. The investment in Lion creates a potential vertical integration with a broader industrial market development strategy to bring new technologies to market which use palladium and platinum. Research and development efforts by FIU on behalf of Lion continue and additional patent applications are in process.

The Company will continue to follow government health directives in the months ahead and will make the health and safety of employees a priority. The Company plans to drive ahead with its core business objectives while reducing costs where possible in this period of market uncertainty.

As well as the discussions within this MD&A, the reader is encouraged to also see the Company's disclosure made under the heading "Risk Factors" in the Company's Form 20-F, which was also filed as the Company's AIF in Canada.

10. Critical Accounting Estimates and Judgements

The preparation of the Company's consolidated financial statements in conformity with IFRS required management to use estimates and assumptions that affect the reported amounts of assets and liabilities, as well as income and expenses. The Company's accounting policies are described in Note 3 of the Company's audited consolidated financial statements for the year ended August 31, 2020.

Fair value of embedded derivatives

Where the fair value of financial liabilities recorded in the financial statements cannot be derived from active markets, their fair value is determined using valuation techniques including the partial differential equation method. The inputs to this model are taken from observable markets where possible, but where this is not feasible, a degree of judgment is required in establishing fair values. The judgments include considerations of inputs such as liquidity risk, credit risk and volatility. Changes in assumptions about these factors could affect the reported fair value of financial instruments. When measuring the fair value of an asset or liability, the Company uses observable market data as far as possible.

22

PLATINUM GROUP METALS LTD.

(An Exploration and Development Stage Company) Supplementary Information and MD&A

For the year ended August 31, 2020

Determination of ore reserve and mineral resource estimates

The Company estimates its ore reserves and mineral resources based on information compiled by Qualified Persons as defined by NI 43-101. Reserves determined in this way are used in the calculation of depreciation, amortization and impairment charges, and for forecasting the timing of the payment of closure and restoration costs. In assessing the life of a mine for accounting purposes, mineral resources are only taken into account where there is a high degree of confidence of economic extraction. There are numerous uncertainties inherent in estimating ore reserves, and assumptions that are valid at the time of estimation and they may change significantly when new information becomes available. Changes in the forecast prices of commodities, exchange rates, production costs or recovery rates may change the economic status of reserves and may, ultimately, result in reserves being restated. Such changes in reserves could impact depreciation and amortization rates, asset carrying values and provisions for close down and restoration costs.

Assumption of control of Mnombo and Waterberg JV Resources for accounting purposes

The Company has judged that it controls Mnombo for accounting purposes as it owns 49.9% of the outstanding shares of Mnombo and has contributed all material capital to Mnombo since acquiring its 49.9% share. From inception to date, the Company has funded both the Company's and Mnombo's share of expenditures on the Waterberg Project. At August 31, 2020 Mnombo owed the Company approximately $4.8 million for funding provided. Currently there are no other sources of funding known to be available to Mnombo. If in the future Mnombo is not deemed to be controlled by the Company, the assets and liabilities of Mnombo would be derecognized at their carrying amounts. Amounts recognized in other comprehensive income would be transferred directly to retained earnings. If a retained interest remained after the loss of control it would be recognized at its fair value on the date of loss of control. Although the Company controls Mnombo for accounting purposes, it does not have omnipotent knowledge of Mnombo's other shareholders activities. Mnombo's 50.01% shareholders are historically disadvantaged South Africans. The Company also determined that it controls Waterberg JV Resources given its control over Mnombo as well as its power over the investee.

Deferred tax assets and liabilities and resource taxes

The determination of our future tax liabilities and assets involves significant management estimation and judgment involving a number of assumptions. In determining these amounts the Company interprets tax legislation in a variety of jurisdictions and makes estimates of the expected timing of the reversal of future tax assets and liabilities. We also make estimates of our future earnings which affect the extent to which potential future tax benefits may be used. We are subject to assessment by various taxation authorities, which may interpret tax legislation in a manner different from our view. These differences may affect the final amount or the timing of the payment of taxes. When such differences arise, we make provision for such items based on our best estimate of the final outcome of these matters.

11. Change in Accounting Policies

On September 1, 2019, the Company adopted IFRS 16, Leases ("IFRS 16") which replaces IAS 17, Leases. IFRS 16 eliminates the classification as an operating lease and requires lessees to recognize a right-of-use asset and a lease liability in the statement of financial position for all leases, with exemptions permitted for short-term leases and leases of low value assets. In addition, IFRS 16 changes the definition of a lease and sets requirements on how to account for the asset and liability. Under IFRS 16, a lessee recognizes a right-of-use asset representing its right to use the underlying asset and a lease liability representing its obligation to make lease payments. The right-of-use asset is initially measured at cost, which comprises the initial amount of the lease liability adjusted for any lease payments made at or before the commencement date. Lease liabilities are initially measured at the present value of future lease payments and subsequently measured at amortized cost using the effective interest method.

The Company adopted IFRS 16 using the modified retrospective approach without restatement of comparative amounts. An assessment was made and the impact to the Company's consolidated financial statements was to set up a lease liability and a corresponding right-of-use asset of $0.2 million for its office lease as at September 1, 2019. Certain contracts qualify as short-term or low value leases and meet the scope exemption for disclosure only. No other significant differences have been identified in relation to the adoption of IFRS 16. See note 2 to the consolidated financial statements as at August 31, 2020 for further information related to the adoption of IFRS 16.

23

PLATINUM GROUP METALS LTD.

(An Exploration and Development Stage Company) Supplementary Information and MD&A

For the year ended August 31, 2020

12. Disclosure Controls and Internal Control Over Financial Reporting

The Company maintains a set of disclosure controls and procedures designed to ensure that information required to be disclosed in filings made pursuant to both SEC and Canadian Securities Administrators requirements are recorded, processed, summarized and reported in the manner specified by the relevant securities laws applicable to the Company. Disclosure controls and procedures include, without limitation, controls and procedures designed to ensure that information required to be disclosed by an issuer in the reports that it files or submits under the applicable securities legislation is accumulated and communicated to the issuer's management, including its principal executive and principal financial officers, or persons performing similar functions, as appropriate to allow timely decisions regarding required disclosure.

Changes in Internal Controls over Financial Reporting

Management is responsible for establishing and maintaining adequate internal controls over financial reporting. Any system of internal control over financial reporting, no matter how well designed, has inherent limitations. Therefore, even those systems determined to be effective can provide only reasonable assurance with respect to financial statement preparation and presentation. There has been no change in our internal control over financial reporting during the year ended August 31, 2017 that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.

Exemption from Section 404(b) of the Sarbanes-Oxley Act

Under the Jumpstart Our Business & Startups Act ("JOBS Act") emerging growth companies are exempt from Section 404(b) of the Sarbanes-Oxley Act, which generally requires public companies to provide an independent auditor attestation of management's assessment of the effectiveness of their internal control over financial reporting. The Company qualifies as an emerging growth company under the JOBS Act and therefore has not obtained an independent auditor attestation of management's assessment of the effectiveness of its internal control over financial reporting for the year ended August 31, 2020.

13. Other Information

Additional information relating to the Company for the period ended August 31, 2020 may be found on SEDAR at www.sedar.comand on EDGAR at www.sec.gov. Readers are encouraged to review the Company's audited annual consolidated financial statements for the year ended August 31, 2020 together with the notes thereto as well as the Company's Form 20-F, which was also filed as the Company's form of AIF.

14. List of Directors and Officers

Directors	Officers
R. Michael Jones	R. Michael Jones (CEO)
Frank R. Hallam	Frank R. Hallam (CFO & Corporate Secretary)
Tim Marlow	Kris Begic (VP, Corporate Development)
Diana Walters
John Copelyn
Stuart Harshaw

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