ABOUT
THIS PROSPECTUS
This
prospectus is part of a registration statement that we have filed with the Securities and Exchange Commission (the “SEC”)
pursuant to which the selling stockholder named herein may, from time to time, offer and sell or otherwise dispose of the shares of our
common stock covered by this prospectus. You should not assume that the information contained in this prospectus is accurate on any date
subsequent to the date set forth on the front cover of this prospectus or that any information we have incorporated by reference is correct
on any date subsequent to the date of the document incorporated by reference, even though this prospectus is delivered or shares of common
stock are sold or otherwise disposed of on a later date. It is important for you to read and consider all information contained in this
prospectus, including the documents incorporated by reference therein, in making your investment decision. You should also read and consider
the information in the documents to which we have referred you under “Where You Can Find Additional Information” and “Information
Incorporated by Reference” in this prospectus.
We
have not authorized anyone to give any information or to make any representation to you other than those contained or incorporated by
reference in this prospectus. You must not rely upon any information or representation not contained or incorporated by reference in
this prospectus. This prospectus does not constitute an offer to sell or the solicitation of an offer to buy any of our shares of common
stock other than the shares of our common stock covered hereby, nor does this prospectus constitute an offer to sell or the solicitation
of an offer to buy any securities in any jurisdiction to any person to whom it is unlawful to make such offer or solicitation in such
jurisdiction. Persons who come into possession of this prospectus in jurisdictions outside the United States are required to inform themselves
about, and to observe, any restrictions as to the offering and the distribution of this prospectus applicable to those jurisdictions.
PROSPECTUS
SUMMARY
This
summary description about us and our business highlights selected information contained elsewhere in this prospectus or incorporated
by reference into this prospectus. It does not contain all the information you should consider before investing in our securities. Important
information is incorporated by reference into this prospectus. To understand this offering fully, you should read carefully the entire
prospectus, including “Risk Factors” and “Cautionary Note Regarding Forward-Looking Statements,” together with
the additional information described under “Information Incorporated by Reference.” Unless the context indicates or suggests
otherwise, references to “we,” “our,” “us,” the “Company,” or the “Registrant”
refer to Bunker Hill Mining Corp., a Nevada corporation. References to “$” refer to monetary amounts expressed in U.S. dollars.
All references to “C$” refer to monetary amounts expressed in Canadian dollars.
Note
Regarding Financial Statements
On
February 12, 2021, the Company’s Board of Directors (the “Board”) approved a change in our fiscal year end from the
last day of June to a calendar fiscal year ending on the last day of December of each year, effective January 1, 2021. In this report,
references to “fiscal year” refer to years ending June 30. References in this report to the “transition period”
refer to the six-month period ended December 31, 2020.
Our
Business
Corporate
Information
The
Company was incorporated for the purpose of engaging in mineral exploration and development activities. The Company’s sole focus
is the Bunker Hill mine (the “Mine”), as described below.
Corporate
History
The
Company was incorporated under the laws of the State of Nevada, U.S.A, on February 20, 2007 under the name Lincoln Mining Corp. On February
11, 2010, the Company changed its name to Liberty Silver Corp and subsequently, on September 29, 2017, the Company changed its name to
Bunker Hill Mining Corp. The Company’s registered office is located at 1802 N. Carson Street, Suite 212, Carson City, Nevada 89701,
and its head office is located at 82 Richmond Street East, Toronto, Ontario, Canada, M5C 1P1, and its telephone number is 416-477-7771.
The Company’s website is www.bunkerhillmining.com. Information appearing on the website is not incorporated by reference into this
report.
On
August 28, 2017, the Company announced that it signed a definitive agreement with Placer Mining Corporation (“Placer Mining”),
the current owner of the Mine, for the lease and option to purchase the Mine in Idaho (the “Lease and Option Agreement”).
The
Mine remains the largest single producing mine by tonnage in the Coeur d’Alene lead, zinc and silver mining district in Northern
Idaho. Historically and according to the Bunker Hill Mines Annual Report 1980, the Mine produced over 35,000,000 tonnes of ore grading
on average 8.76% lead, 3.67% zinc, and 155 g/t silver. The Mine is the Company’s only focus, with a view to raising capital to
rehabilitate the mine and put it back into production.
On
November 1, 2019, the Lease and Option Agreement was amended (the “Amended Agreement”). Under the terms of the Amended Agreement,
the Company has an option to purchase the marketable assets of the Mine for a purchase price of $11,000,000 at any time prior to the
expiration of the Amended Agreement, payable $6,200,000 in cash, and $4,800,000 in unregistered Common Shares of the Company (calculated
using the market price at the time of exercise of the purchase option). Upon signing the Amended Agreement, the Company paid a one-time,
non-refundable cash payment of $300,000 to Placer Mining. This payment will be applied to the cash portion of the purchase price upon
execution of the purchase option. In the event the Company elects not to exercise the purchase option, the payment shall be treated as
an additional care and maintenance payment. An additional term of the Amended Agreement provides for the elimination of all royalty payments
that were to be paid to Placer Mining.
Under
the terms of the Amended Agreement, during the term of the lease, the Company must make care and maintenance payments in the amount of
$60,000 monthly plus other expenses, i.e. taxes, utilities and mine rescue payments.
On
July 27, 2020, the Company announced that it secured, for a $150,000 cash payment, a further extension to the Lease and Option, Amended
and Extension Agreements to purchase the Mine from Placer Mining (the “Second Extension”). The Second Extension is for a
further 18 months and is in addition to the 6-month extension. This Second Extension expires on August 1, 2022. This Second Extension
provides the Company with more time to invest the proceeds of the ongoing financing in ways that compile and digitize fully over 95 years
of historical and geological data, verify the historical reserves, and explore the high-grade silver targets within the Mine complex.
On
November 20, 2020 the Company successfully renegotiated the Amended Agreement. Under the new terms, the purchase price has been decreased
from $11,000,000 to $7,700,000, with $5,700,000 payable in cash (with an aggregate of $300,000 to be credited toward the purchase price
of the Mine as having been previously paid by the Company and an aggregate of $5,400,000 payable in cash outstanding) and $2,000,000
in Common Shares of the Company. The reference price for the payment in Common Shares will be based on the share price of the last equity
raise before the option is exercised. The Company will continue to make a monthly care and maintenance payment of $60,000 to the Lessor
in return for on-going technical support to the Company. Under this amendment to the Amended Agreement, the Company’s contingent
obligation to settle $1,787,300 of accrued payments due to the Lessor has been waived. Further, under the amendment to the Amended Agreement,
the Company is to make an advance payment of $2,000,000 to Placer Mining, which shall be credited toward the purchase price of the Mine
when the Company elects to exercise its purchase right. In the event that the Company irrevocably elects not to exercise its purchase
right, the advance payment of $2,000,000 will be repaid to the Company within twelve months from the date of such election. The Company
made this advance payment, which had the effect of decreasing the remaining amount payable to purchase the Mine to an aggregate of $3,400,000
payable in cash and $2,000,000 in Common Shares of the Company.
As
a part of the purchase price, the Amended Agreement also requires payments pursuant to an agreement with the U.S. Environmental Protection
Agency (“EPA”) whereby for so long as the Company leases, owns and/or occupies the Mine, the Company will make payments to
the EPA on behalf of Placer Mining in satisfaction of the EPA’s claim for cost recovery. These payments, if all are made, will
total $20,000,000. The agreement calls for payments starting with $1,000,000 30 days after a fully ratified agreement was signed (which
payment was made) followed by $2,000,000 on November 1, 2018 and $3,000,000 on each of the next 5 anniversaries with a final $2,000,000
payment on November 1, 2024. In addition to these payments, the Company is to make semi-annual payments of $480,000 on June 1 and December
1 of each year, to cover the EPA’s estimated costs of maintaining and treating water at the water treatment facility with a true-up
to be paid by the Company once the actual costs are determined. The November 1, 2018, December 1, 2018, June 1, 2019, November 1, 2019
and November 1, 2020 payments, totaling $8,960,000, were not made, and concurrent with discussions concerning the long-term water management
solutions the Company is having discussions with the EPA in an effort to reschedule these payments in ways that enable the sustainable
operation of the Mine as a viable long-term business.
Management
believes the Amended Agreement will provide the Company time to complete exploratory drilling, engineering studies, produce a mine plan
and raise the money needed to move forward. Management continues to push forward and advance the timeline to realizing shareholder value.
The
Company believes that there are numerous exploration targets of opportunity left in the Mine from surface, in parallel to known and mined
mineralization and at depth, below existing workings. In addition to the zinc-rich zones, these also include high-grade lead-silver veins
which are currently the primary focus of the Company’s exploration programs.
Recent
Developments
Board
and Officer Appointments
On
March 27, 2020, the Company appointed Mr. Richard Williams to the Company’s Board and as Executive Chairman of the Company.
On
April 14, 2020, Mr. Sam Ash was appointed as President and CEO of the Company to replace in this position Mr. John Ryan. Mr. Ryan continued
to serve the Company as a non-executive member of the Board until his resignation on November 2, 2020.
On
October 30, 2020, the Company appointed Ms. Pamela Saxton to serve as an independent director, and Chair of the Audit Committee, replacing
Hugh Aird.
On
November 2, 2020, the Company appointed Ms. Cassandra Joseph to the Board as an independent director, and Chair of the new Governance
Committee, replacing John Ryan who retired from the Board after serving since 2016.
Effective
as of January 12, 2021, the Board appointed Mr. David Wiens to the role of Chief Financial Officer and Corporate Secretary of the Company,
replacing Mr. Wayne Parsons, who continues to serve on the Board.
Financing
Transactions
On
April 24, 2020, the Company extended the demand date of a promissory note payable to August 1, 2020. In consideration, the Company issued
400,000 Common Share purchase warrants to the lender at an exercise price of C$0.50. The Common Share purchase warrants expire on November
13, 2021.
On
May 12, 2020, the Company issued 107,143 Common Shares at a price of $0.56 per Common Share (the “May $0.56 Issuance”), pursuant
to the terms of a private placement of Common Shares at $0.56 per Common Share. The previous tranche closed on February 26, 2020. The
May $0.56 Issuance was made in consultation with the Canadian Securities Exchange (“CSE”). Additionally, the Company issued
two promissory notes. The first promissory note was in the amount of $362,650 (C$500,000), net of $89,190 of debt issue costs (the “First
Note”). The First Note bears no interest and is due on demand 90 days after the issue date. Subsequent to June 30, 2020, the balance
of the First Note was repaid in full. The second promissory note was in the amount of $141,704 (C$200,000), net of $35,676 of debt issue
costs (the “Second Note”). The Second Note bears no interest and is due on demand 90 days after the issue date. The Second
Note was settled in full by shares issued subsequent to June 30, 2020.
On
June 30, 2020, the Company issued a promissory note in the amount of $75,000 (C$103,988). The note bears no interest and is due on demand.
The promissory note was repaid in full subsequent to June 30, 2020.
On
June 30, 2020, the Company issued a promissory note in the amount of $75,000 (C$103,988) to a director of the Company. The note bears
no interest and is due on demand. The promissory note was repaid in full subsequent to June 30, 2020
In
addition, the Company entered into a loan agreement with an arm’s length third party for an unsecured loan facility of $1,200,000
(the “Loan”) due August 31, 2020. As consideration for the Loan, the Company agreed to pay the lender a one-time origination
fee of $360,000. The purpose of the Loan is to provide the Company with working capital pending the completion of an equity financing.
In addition, the Company announced that it has entered into an extension agreement with Placer Mining to extend the Lease and Option
and Amended Agreements for the Mine (the “Extension”) for an additional six-month term subject to the same terms and conditions
of the Lease. The term of the Extension began on August 2, 2020 and will expire on February 1, 2021. In connection with the Extension,
a one-time payment of $60,000 was paid to Placer Mining.
On
August 14, 2020, the Company closed the first tranche of the brokered private placement of units of the Company (the “August 2020
Offering”), issuing 35,212,142 units of the Company (the “August 2020 Units”) at C$0.35 per August 2020 Unit for gross
proceeds of C$12,324,250. Each August 2020 Unit consisted of one Common Share and one Common Share purchase warrant of the Company (“August
2020 Warrant”). Each August 2020 Warrant is exercisable into a Common Share of the Company at C$0.50 per August 2020 Warrant until
August 31, 2023. In connection with the first tranche of the August 2020 Offering, the Company paid cash compensation of C$739,455 and
issued 2,112,729 compensation options (the “August 2020 Compensation Options”). Each August 2020 Compensation Option is exercisable
into one August 2020 Unit until August 31, 2023.
On
August 25, 2020, the Company closed the second tranche of the August 2020 Offering, issuing 20,866,292 August 2020 Units at C$0.35 per
August 2020 Unit for gross proceeds of C$7,303,202. In connection with the second tranche of the August 2020 Offering, the Company paid
cash compensation of C$314,512 and issued 1,127,178 August 2020 Compensation Options. The Company also issued 2,205,714 August 2020 Units
to settle C$772,000 of debt. The registration statement of which this report is a part was filed by the Company as a result of an agreement
with the placement agents in the August 2020 Offering.
On
October 9, 2020, the Company issued 5,572,980 shares at a deemed price of C$0.50 based on the fair value of the share issued to settle
$1,600,000 of convertible loan payable and $500,000 of interest payable. As a result, the Company recorded a loss on debt settlement
of $106,113.
On
December 28, 2020, the Company announced that early-stage strategic investors have entered into voluntary lock up agreements pursuant
to which they will not sell, transfer or pledge any of the Company shares acquired in the 2019 recapitalization. This represents approximately
35 million shares or 24.5% of the issued share capital of the Company. The lock-up includes shares held by Hummingbird Resources PLC
(“Hummingbird”) as well as management and advisors and is in effect until December 31, 2021. In addition, the term of the
Common Share purchase warrants issued with the 2019 recapitalization has been amended to December 31, 2025, and the exercise price has
been amended from C$0.25 to C$0.59.
On
February 24, 2021, the Company closed a non-brokered private placement of 19,994,080 Units of the Company at $0.40 per Unit for gross
proceeds of approximately C$8,000,000. Each Unit consists of one Common Share of the Company and one Common Share purchase warrant. Each
whole warrant entitles the holder to acquire one Common Share of the Company at a price of C$0.60 per Common Share for a period of five
years. Pursuant to the offering, certain directors and officers of the Company acquired 626,580 Units. This issuance of such Units in
connection with the offering was considered a “related party transaction” as such term is defined under Multilateral Instrument
61-101 – Protection of Minority Security Holders in Special Transactions (“MI 61-101”).
On
September 23, 2021, the Company announced that it entered into a loan of $2,500,000 to support near-term working capital requirements,
and also to purchase a land parcel contiguous to the Mine for approximately $200,000. The purchased land will be available as security
on the loan. The loan has a maturity date of the earlier of March 15, 2022, or the date at which more than US$10,000,000 of equity in
the Company is raised in aggregate, beginning September 22, 2021. Interest on the outstanding principal balance shall accrue daily and
be calculated, in arrears, at the rate of 15% per annum and payable at maturity. There are no other fees or costs payable in relation
to the Loan, which may also be repaid at any time prior to maturity without penalty.
Bunker
Hill Mine Restart Developments
Since
March 2020, the Company has been working systematically to validate in accordance with National Instrument 43-101 – Standards
of Disclosure for Mineral Projects (“NI 43-101”) standards up to 9 million tons of primarily zinc ore contained within
the UTZ, Quill and Newgard Ore Bodies. This work was conducted between April and July 2020, and involved over 9,000 feet of drilling
from Underground and extensive sampling from the many open stopes above the water-level. These zones could provide the majority of the
early feed if the Company were to achieve a restart of the Mine.
On
September 28, 2020, the Company announced its maiden mineral resources estimate consisting of a total of 8.9 million tons in the Inferred
category, containing 11 million ounces of silver, 880 million pounds of zinc, and 410 million pounds of lead, which represented the result
of the Company’s extensive drilling and sampling efforts conducted between April and July 2020.
On
November 12, 2020, the Company announced the launch of a Preliminary Economic Assessment (“PEA”) to assess the potential
for a rapid restart of the Mine for minimal capital by focusing on the de-watered upper areas of the Mine, utilizing existing infrastructure,
and based on truck haulage and toll milling methods.
On
January 26, 2021, the Company reported continued progress towards completing the previously announced PEA, and further detail regarding
the potential parameters of the restart, including: i) low up-front capital costs through utilization of existing infrastructure, potentially
enabling a rapid production restart; ii) a staged approach to mining, potentially supporting a long-life operation; iii) underground
processing and tailings deposition with potential for high recovery rates; iv) development of a sustainable operation with minimal environmental
footprint; and v) potential increase in the existing resource base.
To
support the Company’s strategy of targeting a rapid production restart as outlined above, development drilling subsequent to November
2020 focused on targets in the upper levels of the Mine located in close proximity to existing infrastructure, aimed at expanding the
resource base for the PEA.
On
March 19, 2021, the Company announced a mineral resource estimate (the “Mineral Resource Estimate” or “MRE”)
consisting of a total of: 4.4 million tons in the Indicated category, containing 3.0 million ounces of silver, 487 million pounds of
zinc, and 176 million pounds of lead; 5.6 million tons in the Inferred category, containing 8.3 million ounces of silver, 548 million
pounds of zinc, and 312 million pounds of lead.
On
April 20, 2021, the Company announced the results of its PEA for the Mine. The PEA contemplates a $42 million initial capital cost (including
20% contingency) to rapidly restart the Mine, generating approximately $20 million of annual average free cash flow over a 10-year mine
life, and producing over 550 million pounds of zinc, 290 million pounds of lead, and 7 million ounces of silver at all-in sustaining
costs of $0.65 per payable pound of zinc (net of by-products). The PEA contemplates a low environmental footprint, long-term water management
solution, and significant positive economic impact for the Shoshone County, Idaho community. The PEA is based on the Mineral Resource
Estimate described above and published on May 3, 2021, following the drilling program conducted in 2020 and early 2021 to validate the
historical reserves. The PEA includes a mining inventory of 5.5Mt, which represents a portion of the 4.4Mt Indicated mineral resource
and 5.6Mt Inferred mineral resource that comprise the Mineral Resource Estimate. The PEA is preliminary in nature and includes Inferred
mineral resources that are considered too speculative geologically to have the economic considerations applied to them that would enable
them to be categorized as mineral reserves. There is no certainty that the project described in the PEA will be realized. Mineral resources
that are not mineral reserves do not have demonstrated economic viability.
On
May 3, 2021, the Company filed a technical report with further detail regarding the MRE entitled “Technical Report for the Bunker
Hill Mine, Coeur d’Alene Mining District, Shoshone County, Idaho, USA” with an effective date of March 22, 2021. This technical
report was prepared in accordance with the requirements of subpart 1300 of Regulation S-K (the “SEC Mining Modernization Rules”)
and Canadian National Instrument 43-101 — Standards of Disclosure for Mineral Projects (“NI 43-101”).
On
June 4, 2021, the Company filed a technical report entitled “Technical Report And Preliminary Economic Assessment For Underground
Milling And Concentration Of Lead, Silver And Zinc At The Bunker Hill Mine, Bunker Hill Mine, Coeur d’Alene Mining District, Shoshone
County, Idaho, USA” in support of the PEA that it announced on April 20, 2021 (as described above). This technical report was prepared
in accordance with the requirements of the SEC Mining Modernization Rules and NI 43-101
On
September 20, 2021, the Company announced the results of an updated PEA for the Mine. The updated PEA contemplates a $44 million initial
capital cost (including 20% contingency) to rapidly restart the Mine, generating approximately $25 million of annual average free cash
flow over an 11-year mine life, and producing over 590 million pounds of zinc, 320 million pounds of lead, and 8 million ounces of silver
at all-in sustaining costs of $0.47 per payable pound of zinc (net of by-products). As with the PEA published on June 4, 2021, the updated
PEA is based on the Mineral Resource Estimate described above and published on May 3, 2021, following the drilling program conducted
in 2020 and early 2021 to validate the historical reserves. The PEA includes a mining inventory of 6.4Mt, which represents a portion
of the 4.4Mt Indicated mineral resource and 5.6Mt Inferred mineral resource that comprise the Mineral Resource Estimate.
On
October [27], 2021, the Company filed a technical report entitled “Technical Report And Preliminary Economic Assessment For Underground
Milling And Concentration Of Lead, Silver And Zinc At The Bunker Hill Mine, Bunker Hill Mine, Coeur d’Alene Mining District, Shoshone
County, Idaho, USA” in support of the updated PEA that it announced on September 20, 2021 (as described above). This technical
report was prepared in accordance with the requirements of the SEC Mining Modernization Rules and NI-43-101 and is filed as an exhibit
to the Registration Statement of which this prospectus is a part.
Further
details regarding the MRE, including estimation methodologies, can be found in the technical report which is filed as an exhibit to the
Registration Statement of which this prospectus is a part.
Silver-Focused
Exploration
With
the completion of exploration drilling related to the MRE, the Company’s exploration strategy has been focused on high-grade silver
targets within the upper areas of the Mine that have been identified by the data review and digitization process. The aim of this program
is to identify, develop and add high-grade silver resources in ways that materially increase the relative quantity of silver resources
relative to lead and zinc.
Consistent
with that strategy and concurrent with the announcement of the updated mineral resources estimate, the Company announced the identification
of a new silver exploration opportunity in the hanging wall of the Cate Fault which it intends to include in its ongoing drilling campaign.
In conjunction with this drilling campaign, continued digitization, geologic modeling and interpretation will continue to focus on identifying
additional high grade silver exploration targets.
On
March 29, 2021, the Company announced multiple high-grade silver mineralization results through chip-channel sampling of newly accessible
areas of the Mine identified through the Company’s proprietary 3D digitization program, and as part of its ongoing silver-focused
drilling program. An area was identified on the 9-level that resulted in ten separate chip samples greater than 900 g/t AgEq(1),
each with minimum 0.6m length. Mineralization remains open up dip, down dip and along strike from the sampling location. The Company
also reported drill results including a 3.8m intercept with a grade of 996.6 g/t AgEq(1), intersected at the down-dip extension
of the UTZ zone at the 5-level. The Company will continue to report mineralized drill intercepts concurrent with its ongoing exploration
program that is currently envisaged to comprise 10,000 to 12,000 feet in 2021.
On
August 23, 2021, the Company announced further drill results, including intercepts from silver-lead vein extensions delineated through
testing of the down-dip and off-set portions of the Jersey-Deadwood vein system on the 9-level.
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Prices
used to calculate Ag Eq are as follows: Zn=$1.16/lb; Pb=$0.92/lb; and Ag=$20/oz.
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General
Risk Factors
The
Company’s ability to operate as a going concern is in doubt.
The
audit opinion and notes that accompany the Company’s Financial Statements disclose a going concern qualification to its ability
to continue in business. The accompanying Financial Statements have been prepared under the assumption that the Company will continue
as a going concern. The Company is an exploration stage company and has incurred losses since its inception. The Company has incurred
losses resulting in an accumulated deficit of $56,245,378 as of September 30, 2021 and further losses are anticipated in
the development of its business.
The
Company currently has no historical recurring source of revenue and its ability to continue as a going concern is dependent on its ability
to raise capital to fund its future exploration and working capital requirements or its ability to profitably execute its business plan.
The Company’s plans for the long-term return to and continuation as a going concern include financing its future operations through
sales of its Common Shares and/or debt and the eventual profitable exploitation of the Mine. Additionally, the volatility in capital
markets and general economic conditions in the U.S. and elsewhere can pose significant challenges to raising the required funds. These
factors raise substantial doubt about the Company’s ability to continue as a going concern.
The
Company’s consolidated financial statements do not give effect to any adjustments required to realize its assets and discharge
its liabilities in other than the normal course of business and at amounts different from those reflected in the accompanying Financial
Statements.
The
Company will require significant additional capital to fund its business plan.
The
Company will be required to expend significant funds to determine whether proven and probable mineral reserves exist at its properties,
to continue exploration and, if warranted, to develop its existing properties, and to identify and acquire additional properties to diversify
its property portfolio. The Company anticipates that it will be required to make substantial capital expenditures for the continued exploration
and, if warranted, development of the Mine. The Company has spent and will be required to continue to expend significant amounts of capital
for drilling, geological, and geochemical analysis, assaying, and feasibility studies with regard to the results of its exploration at
the Mine. The Company may not benefit from some of these investments if it is unable to identify commercially exploitable mineral reserves.
The
Company’s ability to obtain necessary funding for these purposes, in turn, depends upon a number of factors, including the status
of the national and worldwide economy and the price of metals. Capital markets worldwide were adversely affected by substantial losses
by financial institutions, caused by investments in asset-backed securities and remnants from those losses continue to impact the ability
for the Company to raise capital. The Company may not be successful in obtaining the required financing or, if it can obtain such financing,
such financing may not be on terms that are favorable to us.
The
Company’s inability to access sufficient capital for its operations could have a material adverse effect on its financial condition,
results of operations, or prospects. Sales of substantial amounts of securities may have a highly dilutive effect on the Company’s
ownership or share structure. Sales of a large number of shares of the Company’s Common Shares in the public markets, or the potential
for such sales, could decrease the trading price of the Common Shares and could impair the Company’s ability to raise capital through
future sales of Common Shares. The Company has not yet commenced commercial production at any of its properties and, therefore, has not
generated positive cash flows to date and has no reasonable prospects of doing so unless successful commercial production can be achieved
at the Mine. The Company expects to continue to incur negative investing and operating cash flows until such time as it enters into successful
commercial production. This will require the Company to deploy its working capital to fund such negative cash flow and to seek additional
sources of financing. There is no assurance that any such financing sources will be available or sufficient to meet the Company’s
requirements. There is no assurance that the Company will be able to continue to raise equity capital or to secure additional debt financing,
or that the Company will not continue to incur losses.
The
Company has a limited operating history on which to base an evaluation of its business and prospects.
Since
its inception, the Company has had no revenue from operations. The Company has no history of producing products from the Bunker Hill
property. The Mine is a historic, past producing mine with very little recent exploration work. Advancing the Mine into the development
stage will require significant capital and time, and successful commercial production from the Mine will be subject to completing feasibility
studies, permitting and re-commissioning of the Mine, constructing processing plants, and other related works and infrastructure. As
a result, the Company is subject to all of the risks associated with developing and establishing new mining operations and business enterprises,
including:
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completion
of feasibility studies to verify reserves and commercial viability, including the ability to find sufficient ore reserves to support
a commercial mining operation;
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the
timing and cost, which can be considerable, of further exploration, preparing feasibility studies, permitting and construction of
infrastructure, mining and processing facilities;
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the
availability and costs of drill equipment, exploration personnel, skilled labor, and mining and processing equipment, if required;
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the
availability and cost of appropriate smelting and/or refining arrangements, if required;
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compliance
with stringent environmental and other governmental approval and permit requirements;
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the
availability of funds to finance exploration, development, and construction activities, as warranted;
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potential
opposition from non-governmental organizations, local groups or local inhabitants that may delay or prevent development activities;
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potential
increases in exploration, construction, and operating costs due to changes in the cost of fuel, power, materials, and supplies; and
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potential
shortages of mineral processing, construction, and other facilities related supplies.
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The
costs, timing, and complexities of exploration, development, and construction activities may be increased by the location of its properties
and demand by other mineral exploration and mining companies. It is common in exploration programs to experience unexpected problems
and delays during drill programs and, if commenced, development, construction, and mine start-up. In addition, the Company’s management
and workforce will need to be expanded, and sufficient housing and other support systems for its workforce will have to be established.
This could result in delays in the commencement of mineral production and increased costs of production. Accordingly, the Company’s
activities may not result in profitable mining operations and it may not succeed in establishing mining operations or profitably producing
metals at any of its current or future properties, including the Mine.
The
Company has a history of losses and expects to continue to incur losses in the future.
The
Company has incurred losses since inception, has had negative cash flow from operating activities, and expects to continue to incur losses
in the future. While the Company earned net income of $9,843,495 during the nine months ended September 30, 2021,
substantially all of this income from a non-cash change in derivative liability. The Company has incurred the following losses from operations
during each of the following periods:
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$12,384,474 for the nine months ended September 30,
2021; and $11,058,237 for the nine months ended September 30, 2020; and
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$9,454,396
for the transition period ended December 31, 2020; and $5,841,502 for the six months ended December 31, 2019; and
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$10,793,823
for the year ended June 30, 2020; and $8,113,926 for the year ended June 30, 2019.
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The
Company expects to continue to incur losses unless and until such time as the Mine enters into commercial production and generates sufficient
revenues to fund continuing operations. The Company recognizes that if it is unable to generate significant revenues from mining operations
and dispositions of its properties, the Company will not be able to earn profits or continue operations. At this early stage of its operation,
the Company also expects to face the risks, uncertainties, expenses, and difficulties frequently encountered by smaller reporting companies.
The Company cannot be sure that it will be successful in addressing these risks and uncertainties and its failure to do so could have
a materially adverse effect on its financial condition.
Epidemics,
pandemics or other public health crises, including COVID-19, could adversely affect the Company’s business.
The
Company’s operations could be significantly adversely affected by the effects of a widespread outbreak of epidemics, pandemics
or other health crises, including the recent outbreak of respiratory illness caused by the novel coronavirus (“COVID-19”),
which was declared a pandemic by the World Health Organization on March 12, 2020. The Company cannot accurately predict the impact COVID-19
will have on its operations and the ability of others to meet their obligations with the Company, including uncertainties relating to
the ultimate geographic spread of the virus, the severity of the disease, the duration of the outbreak, and the length of travel and
quarantine restrictions imposed by governments of affected countries. In addition, a significant outbreak of contagious diseases in the
human population could result in a widespread health crisis that could adversely affect the economies and financial markets of many countries,
resulting in an economic downturn that could further affect the Company’s operations and ability to finance its operations.
Risks
Related to Mining and Exploration
The
Mine is in the exploration stage. There is no assurance that the Company can establish the existence of any mineral reserve on the Mine
or any other properties the Company may acquire in commercially exploitable quantities. Unless and until the Company does so, the Company
cannot earn any revenues from these properties and if the Company does not do so, the Company will lose all of the funds that it expends
on exploration. If the Company does not discover any mineral reserve in a commercially exploitable quantity, the exploration component
of its business could fail.
The
Company has not established that any of its mineral properties contain any mineral reserve according to recognized reserve guidelines,
nor can there be any assurance that the Company will be able to do so.
The
Company has not established that any of its mineral properties contain any mineral reserve according to recognized reserve guidelines,
nor can there be any assurance that the Company will be able to do so. In general, the probability of any individual prospect having
a “reserve” that meets the requirements of the SEC is small, and the Mine may not contain any “reserves” and
any funds that the Company spends on exploration could be lost. Even if the Company does eventually discover a mineral reserve on the
Mine, there can be no assurance that it can be developed into a producing mine and that the Company can extract those minerals. Both
mineral exploration and development involve a high degree of risk, and few mineral properties that are explored are ultimately developed
into producing mines.
The
commercial viability of an established mineral deposit will depend on a number of factors including, by way of example, the size, grade,
and other attributes of the mineral deposit, the proximity of the mineral deposit to infrastructure such as processing facilities, roads,
rail, power, and a point for shipping, government regulation, and market prices. Most of these factors will be beyond its control, and
any of them could increase costs and make extraction of any identified mineral deposit unprofitable.
The
nature of mineral exploration and production activities involves a high degree of risk and the possibility of uninsured losses.
Exploration
for and the production of minerals is highly speculative and involves much greater risk than many other businesses. Most exploration
programs do not result in the discovery of mineralization, and any mineralization discovered may not be of sufficient quantity or quality
to be profitably mined. The Company’s operations are, and any future development or mining operations the Company may conduct will
be, subject to all of the operating hazards and risks normally incidental to exploring for and development of mineral properties, including,
but not limited to:
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economically
insufficient mineralized material;
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fluctuation
in production costs that make mining uneconomical;
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labor
disputes;
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unanticipated
variations in grade and other geologic problems;
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environmental
hazards;
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water
conditions;
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difficult
surface or underground conditions;
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industrial
accidents;
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metallurgic
and other processing problems;
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mechanical
and equipment performance problems;
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failure
of dams, stockpiles, wastewater transportation systems, or impoundments;
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unusual
or unexpected rock formations; and
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personal
injury, fire, flooding, cave-ins and landslides.
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Any
of these risks can materially and adversely affect, among other things, the development of properties, production quantities and rates,
costs and expenditures, potential revenues, and production dates. If the Company determines that capitalized costs associated with any
of its mineral interests are not likely to be recovered, the Company would incur a write-down of its investment in these interests. All
of these factors may result in losses in relation to amounts spent that are not recoverable, or that result in additional expenses.
Commodity
price volatility could have dramatic effects on the results of operations and the Company’s ability to execute its business plan.
The
price of commodities varies on a daily basis. The Company’s future revenues, if any, will likely be derived from the extraction
and sale of base and precious metals. The price of those commodities has fluctuated widely, particularly in recent years, and is affected
by numerous factors beyond its control including economic and political trends, expectations of inflation, currency exchange fluctuations,
interest rates, global and regional consumptive patterns, speculative activities and increased production due to new extraction developments
and improved extraction and production methods. The effect of these factors on the price of base and precious metals, and therefore the
economic viability of the Company’s business, could negatively affect its ability to secure financing or its results of operations.
The
Company’s production, development plans and cost estimates in the PEA or pre-feasibility study (“PFS”) may vary and/or
not be achieved.
The
PEA is preliminary in nature and will include Inferred mineral resources that are considered too speculative geologically to have the
economic considerations applied to them that would enable them to be categorized as mineral reserves. Consequently, there is no certainty
that the PEA will be realized. The decision to implement the Mine restart scenario to be included in the PEA will not be based on a feasibility
study of mineral reserves demonstrating economic and technical viability, and therefore there is increased risk that the PEA results
will not be realized. If the Company is unable to achieve the results in the PEA, it may have a material negative impact on the Company
and its capital investment to implement the restart scenario may be lost.
The
Company also intends to proceed with a PFS later in 2021 to further assess a rapid restart of the Mine, which is expected to include
estimates of future production, development plans, operating and capital costs and other economic and technical estimates. Such estimates
will be based on a variety of factors and assumptions and there is no assurance that such production, plans, costs or other estimates
will be achieved. Actual production, costs and financial returns may vary significantly from the estimates depending on a variety of
factors many of which are not within the Company’s control. These factors include, but are not limited to: actual ore mined varying
from estimates of grade, tonnage, dilution, and metallurgical and other characteristics; short-term operating factors such as the need
for sequential development of ore bodies and the processing of new or different ore grades from those planned; mine failures, slope failures
or equipment failures; industrial accidents; natural phenomena such as inclement weather conditions, floods, droughts, wildfires, rock
slides and earthquakes; encountering unusual or unexpected geological conditions; changes in power costs and potential power shortages;
exchange rate and commodity price fluctuations; shortages of principal supplies needed for operations, including explosives, fuels, chemical
reagents, water, equipment parts and lubricants; labor shortages or strikes; epidemics, pandemics and public health emergencies, including
those related to the outbreak of COVID-19; high rates of inflation; civil disobedience and protests; and restrictions (including changes
to the taxation regime) or regulations imposed by governmental or regulatory authorities, including permitting and environmental regulations,
or other changes in the regulatory environments. Failure to achieve estimates or material increases in costs could have a material adverse
impact on the Company’s future cash flows, profitability, results of operations and financial condition.
Estimates
of mineralized material and resources are subject to evaluation uncertainties that could result in project failure.
Its
exploration and future mining operations, if any, are and would be faced with risks associated with being able to accurately predict
the quantity and quality of mineralized material and resources/reserves within the earth using statistical sampling techniques. Estimates
of any mineralized material or resource/reserve on the Mine would be made using samples obtained from appropriately placed trenches,
test pits, underground workings, and intelligently designed drilling. There is an inherent variability of assays between check and duplicate
samples taken adjacent to each other and between sampling points that cannot be reasonably eliminated. Additionally, there also may be
unknown geologic details that have not been identified or correctly appreciated at the current level of accumulated knowledge about the
Mine. This could result in uncertainties that cannot be reasonably eliminated from the process of estimating mineralized material and
resources/reserves. If these estimates were to prove to be unreliable, the Company could implement an exploitation plan that may not
lead to commercially viable operations in the future.
Any
material changes in mineral resource/reserve estimates and grades of mineralization will affect the economic viability of placing a property
into production and a property’s return on capital.
As
the Company has not commenced actual production, mineralization resource estimates may require adjustments or downward revisions. In
addition, the grade of ore ultimately mined, if any, may differ from that indicated by future feasibility studies and drill results.
Minerals recovered in small scale tests may not be duplicated in large scale tests under on-site conditions or in production scale.
The
Company’s exploration activities may not be commercially successful, which could lead the Company to abandon its plans to develop
the Mine and its investments in exploration.
The
Company’s long-term success depends on its ability to identify mineral deposits on the Mine and other properties the Company may
acquire, if any, that the Company can then develop into commercially viable mining operations. Mineral exploration is highly speculative
in nature, involves many risks, and is frequently non-productive. These risks include unusual or unexpected geologic formations, and
the inability to obtain suitable or adequate machinery, equipment, or labor. The success of commodity exploration is determined in part
by the following factors:
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the
identification of potential mineralization based on surficial analysis;
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availability
of government-granted exploration permits;
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the
quality of its management and its geological and technical expertise; and
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the
capital available for exploration and development work.
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Substantial
expenditures are required to establish proven and probable reserves through drilling and analysis, to develop metallurgical processes
to extract metal, and to develop the mining and processing facilities and infrastructure at any site chosen for mining. Whether a mineral
deposit will be commercially viable depends on a number of factors that include, without limitation, the particular attributes of the
deposit, such as size, grade, and proximity to infrastructure; commodity prices, which can fluctuate widely; and government regulations,
including, without limitation, regulations relating to prices, taxes, royalties, land tenure, land use, importing and exporting of minerals,
and environmental protection. The Company may invest significant capital and resources in exploration activities and may abandon such
investments if the Company is unable to identify commercially exploitable mineral reserves. The decision to abandon a project may have
an adverse effect on the market value of the Company’s securities and the ability to raise future financing.
The
Company is subject to significant governmental regulations that affect its operations and costs of conducting its business and may not
be able to obtain all required permits and licenses to place its properties into production.
The
Company’s current and future operations, including exploration and, if warranted, development of the Mine, do and will require
permits from governmental authorities and will be governed by laws and regulations, including:
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laws
and regulations governing mineral concession acquisition, prospecting, development, mining, and production;
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laws
and regulations related to exports, taxes, and fees;
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labor
standards and regulations related to occupational health and mine safety; and
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environmental
standards and regulations related to waste disposal, toxic substances, land use reclamation, and environmental protection.
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Companies
engaged in exploration activities often experience increased costs and delays in production and other schedules as a result of the need
to comply with applicable laws, regulations, and permits. Failure to comply with applicable laws, regulations, and permits may result
in enforcement actions, including the forfeiture of mineral claims or other mineral tenures, orders issued by regulatory or judicial
authorities requiring operations to cease or be curtailed, and may include corrective measures requiring capital expenditures, installation
of additional equipment, or costly remedial actions. The Company cannot predict if all permits that it may require for continued exploration,
development, or construction of mining facilities and conduct of mining operations will be obtainable on reasonable terms, if at all.
Costs related to applying for and obtaining permits and licenses may be prohibitive and could delay its planned exploration and development
activities. The Company may be required to compensate those suffering loss or damage by reason of the mineral exploration or its mining
activities, if any, and may have civil or criminal fines or penalties imposed for violations of, or its failure to comply with, such
laws, regulations, and permits.
Existing
and possible future laws, regulations, and permits governing operations and activities of exploration companies, or more stringent implementation
of such laws, regulations and permits, could have a material adverse impact on the Company’s business and cause increases in capital
expenditures or require abandonment or delays in exploration. The Mine is located in Northern Idaho and has numerous clearly defined
regulations with respect to permitting mines, which could potentially impact the total time to market for the project.
The
Company’s activities are subject to environmental laws and regulations that may increase its costs of doing business and restrict
its operations.
Both
mineral exploration and extraction require permits from various federal, state, and local governmental authorities and are governed by
laws and regulations, including those with respect to prospecting, mine development, mineral production, transport, export, taxation,
labor standards, occupational health, waste disposal, toxic substances, land use, environmental protection, mine safety and other matters.
There can be no assurance that the Company will be able to obtain or maintain any of the permits required for the exploration of the
mineral properties or for the construction and operation of the Mine at economically viable costs. If the Company cannot accomplish these
objectives, its business could fail. The Company believes that it is in compliance with all material laws and regulations that currently
apply to its activities but there can be no assurance that the Company can continue to remain in compliance. Current laws and regulations
could be amended, and the Company might not be able to comply with them, as amended. Further, there can be no assurance that the Company
will be able to obtain or maintain all permits necessary for its future operations, or that it will be able to obtain them on reasonable
terms. To the extent such approvals are required and are not obtained, the Company may be delayed or prohibited from proceeding with
planned exploration or development of the mineral properties.
Environmental
hazards unknown to the Company, which have been caused by previous or existing owners or operators of the Mine, may exist on the properties
in which the Company holds an interest. Many of its properties in which the Company has ownership rights are located within the Coeur
d’Alene Mining District, which is currently the site of a Federal Superfund cleanup project. It is possible that environmental
cleanup or other environmental restoration procedures could remain to be completed or mandated by law, causing unpredictable and unexpected
liabilities to arise.
Regulations
and pending legislation governing issues involving climate change could result in increased operating costs, which could have a material
adverse effect on the Company’s business.
A
number of governments or governmental bodies have introduced or are contemplating legislative and/or regulatory changes in response to
concerns about the potential impact of climate change. Legislation and increased regulation regarding climate change could impose significant
costs on the Company, on its future venture partners, if any, and on its suppliers, including costs related to increased energy requirements,
capital equipment, environmental monitoring and reporting, and other costs necessary to comply with such regulations. Any adopted future
climate change regulations could also negatively impact the Company’s ability to compete with companies situated in areas not subject
to such limitations. Given the emotional and political significance and uncertainty surrounding the impact of climate change and how
it should be dealt with, the Company cannot predict how legislation and regulation will ultimately affect its financial condition, operating
performance, and ability to compete. Furthermore, even without such regulation, increased awareness and any adverse publicity in the
global marketplace about potential impacts on climate change by the Company or other companies in its industry could harm the Company’s
reputation. The potential physical impacts of climate change on its operations are highly uncertain, could be particular to the geographic
circumstances in areas in which the Company operates and may include changes in rainfall and storm patterns and intensities, water shortages,
changing sea levels, and changing temperatures. These impacts may adversely impact the cost, production, and financial performance of
the Company’s operations.
There
are several governmental regulations that materially restrict mineral exploration. The Company will be subject to the federal regulations
(environmental) and the laws of the State of Idaho as the Company carries out its exploration program. The Company may be required to
obtain additional work permits, post bonds and perform remediation work for any physical disturbance to the land in order to comply with
these laws. While the Company’s planned exploration program budgets for regulatory compliance, there is a risk that new regulations
could increase its costs of doing business and prevent it from carrying out its exploration program.
Land
reclamation requirements for the Company’s properties may be burdensome and expensive.
Although
variable depending on location and the governing authority, land reclamation requirements are generally imposed on mineral exploration
companies (as well as companies with mining operations) in order to minimize long term effects of land disturbance.
Reclamation
may include requirements to:
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control
dispersion of potentially deleterious effluents;
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treat
ground and surface water to drinking water standards; and
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reasonably
re-establish pre-disturbance landforms and vegetation.
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In
order to carry out reclamation obligations imposed on the Company in connection with its potential development activities, the Company
must allocate financial resources that might otherwise be spent on further exploration and development programs. The Company plans to
set up a provision for its reclamation obligations on its properties, as appropriate, but this provision may not be adequate. If the
Company is required to carry out unanticipated reclamation work, its financial position could be adversely affected.
The
mineral exploration and mining industry is highly competitive.
The
mining industry is intensely competitive in all of its phases. As a result of this competition, some of which is with large established
mining companies with substantial capabilities and with greater financial and technical resources than the Company’s, the Company
may be unable to acquire additional properties, if any, or financing on terms it considers acceptable. The Company also competes with
other mining companies in the recruitment and retention of qualified managerial and technical employees. If the Company is unable to
successfully compete for qualified employees, its exploration and development programs may be slowed down or suspended. The Company competes
with other companies that produce its planned commercial products for capital. If the Company is unable to raise sufficient capital,
its exploration and development programs may be jeopardized or it may not be able to acquire, develop, or operate additional mining projects.
The
silver industry is highly competitive, and the Company is required to compete with other corporations and business entities, many of
which have greater resources than its does. Such corporations and other business entities could outbid the Company for potential projects
or produce minerals at lower costs, which would have a negative effect on the Company’s operations.
Metal
prices are highly volatile. If a profitable market for its metals does not exist, the Company may have to cease operations.
Mineral
prices have been highly volatile and are affected by numerous international economic and political factors over which the Company has
no control. The Company’s long-term success is highly dependent upon the price of silver, as the economic feasibility of any ore
body discovered on its current property, or on other properties the Company may acquire in the future, would, in large part, be determined
by the prevailing market price of the minerals. If a profitable market does not exist, the Company may have to cease operations.
A
shortage of equipment and supplies could adversely affect the Company’s ability to operate its business.
The
Company is dependent on various supplies and equipment to carry out its mining exploration and, if warranted, development operations.
Any shortage of such supplies, equipment, and parts could have a material adverse effect on the Company’s ability to carry out
its operations and could therefore limit, or increase the cost of, production.
Joint
ventures and other partnerships, including offtake arrangements, may expose the Company to risks.
The
Company may enter into joint ventures, partnership arrangements, or offtake agreements, with other parties in relation to the exploration,
development, and production of the properties in which the Company has an interest. Any failure of such other companies to meet their
obligations to the Company or to third parties, or any disputes with respect to the parties’ respective rights and obligations,
could have a material adverse effect on the Company, the development and production at its properties, including the Mine, and on future
joint ventures, if any, or their properties, and therefore could have a material adverse effect on its results of operations, financial
performance, cash flows and the price of its Common Shares.
The
Company may experience difficulty attracting and retaining qualified management to meet the needs of its anticipated growth, and the
failure to manage its growth effectively could have a material adverse effect on its business and financial condition.
The
Company is dependent on a relatively small number of key employees, including its Chief Executive Officer (the “CEO”) and
Chief Financial Officer (the “CFO”). The loss of any officer could have an adverse effect on the Company. The Company has
no life insurance on any individual, and the Company may be unable to hire a suitable replacement for them on favorable terms, should
that become necessary.
The
Company’s results of operations could be affected by currency fluctuations.
The
Company’s properties are currently all located in the U.S. and while most costs associated with these properties are paid in U.S.
dollars, a significant amount of its administrative expenses are payable in Canadian dollars. There can be significant swings in the
exchange rate between the U.S. dollar and the Canadian dollar. There are no plans at this time to hedge against any exchange rate fluctuations
in currencies.
Title
to the Company’s properties may be subject to other claims that could affect its property rights and claims.
There
are risks that title to the Company’s properties may be challenged or impugned. The Mine is located in Northern Idaho and may be
subject to prior unrecorded agreements or transfers and title may be affected by undetected defects.
The
Company may be unable to secure surface access or purchase required surface rights.
Although
the Company obtains the rights to some or all of the minerals in the ground subject to the mineral tenures that the Company acquires,
or has the right to acquire, in some cases the Company may not acquire any rights to, or ownership of, the surface to the areas covered
by such mineral tenures. In such cases, applicable mining laws usually provide for rights of access to the surface for the purpose of
carrying on mining activities; however, the enforcement of such rights through the courts can be costly and time consuming. It is necessary
to negotiate surface access or to purchase the surface rights if long-term access is required. There can be no guarantee that, despite
having the right at law to access the surface and carry on mining activities, the Company will be able to negotiate satisfactory agreements
with any such existing landowners/occupiers for such access or purchase of such surface rights, and therefore the Company may be unable
to carry out planned mining activities. In addition, in circumstances where such access is denied, or no agreement can be reached, the
Company may need to rely on the assistance of local officials or the courts in such jurisdiction, the outcomes of which cannot be predicted
with any certainty. The Company’s inability to secure surface access or purchase required surface rights could materially and adversely
affect its timing, cost, or overall ability to develop any mineral deposits the Company may locate.
The
Company’s properties and operations may be subject to litigation or other claims.
From
time to time the Company’s properties or operations may be subject to disputes that may result in litigation or other legal claims.
The Company may be required to take countermeasures or defend against these claims, which will divert resources and management time from
operations. The costs of these claims or adverse filings may have a material effect on its business and results of operations.
There
are amounts due and owing under the Company’s agreement with the EPA that have not been paid in accordance with the agreed upon
payment schedule. In the event that the EPA or Placer Mining assert default under the terms of the agreement or the Amended Agreement,
respectively, the Company may lose its ability to exercise its right to purchase the Mine, which would have a material adverse impact
on the Company.
Pursuant
to the terms of the Company’s agreement with the EPA, the Company is required to make certain payments to the EPA on behalf of
Placer Mining in the amount of $20,000,000 for cost recovery. The Company has made one payment of $1,000,000 but has not paid the other
payments as they have become due. Failure to pay could be considered a default under the terms of the agreement with the EPA and the
Amended Agreement with Placer Mining. While the Company has been in discussions with the EPA related to the restructuring of the required
payments, there is no guarantee that such efforts will be successful. To date, the Company and the EPA have not come to terms on a restructuring
of the payments required by the agreement. In the event the EPA or Placer Mining declares a default under the terms of the agreement
or the Amended Agreement, respectively, the Company could lose its right to purchase the Mine, which would have a material adverse impact
on the business of the Company.
Mineral
exploration and development is subject to extraordinary operating risks. The Company currently insures against these risks on a limited
basis. In the event of a cave-in or similar occurrence, the Company’s liability may exceed its resources and insurance coverage,
which would have an adverse impact on the Company.
Mineral
exploration, development and production involve many risks. The Company’s operations will be subject to all the hazards and risks
inherent in the exploration for mineral resources and, if the Company discovers a mineral resource in commercially exploitable quantity,
its operations could be subject to all of the hazards and risks inherent in the development and production of resources, including liability
for pollution, cave-ins or similar hazards against which the Company cannot insure or against which the Company may elect not to insure.
Any such event could result in work stoppages and damage to property, including damage to the environment. As of the date hereof, the
Company currently maintains commercial general liability insurance and umbrella liability insurance against these operating hazards,
in connection with its exploration program. The payment of any liabilities that arise from any such occurrence that would not otherwise
be covered under the current insurance policies would have a material adverse impact on the Company.
Risks
Related to the Common Shares
The
Company’s Common Share price may be volatile and as a result investor could lose all or part of their investment.
In
addition to volatility associated with equity securities in general, the value of an investor’s investment could decline due to
the impact of any of the following factors upon the market price of the Common Shares:
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disappointing
results from the Company’s exploration efforts;
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decline
in demand for its Common Shares;
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downward
revisions in securities analysts’ estimates or changes in general market conditions;
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technological
innovations by competitors or in competing technologies;
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investor
perception of the Company’s industry or its prospects; and
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general
economic trends.
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The
Company’s Common Share price on the CSE has experienced significant price and volume fluctuations. Stock markets in general have
experienced extreme price and volume fluctuations, and the market prices of securities have been highly volatile. These fluctuations
are often unrelated to operating performance and may adversely affect the market price of the Common Shares. As a result, an investor
may be unable to sell any Common Shares such investor acquires at a desired price.
Potential
future sales under Rule 144 may depress the market price for the Company’s Common Shares.
In
general, under Rule 144, a person who has satisfied a minimum holding period of between 6 months and one-year and any other applicable
requirements of Rule 144, may thereafter sell such shares publicly. A significant number of the Company’s currently issued and
outstanding Common Shares held by existing shareholders, including officers and directors and other principal shareholders, are currently
eligible for resale pursuant to and in accordance with the provisions of Rule 144. The possible future sale of the Company’s Common
Shares by its existing shareholders, pursuant to and in accordance with the provisions of Rule 144, may have a depressive effect on the
price of its Common Shares in the over-the-counter market.
The
Company’s Common Shares currently deemed a “penny stock”, which may make it more difficult for investors to sell their
Common Shares.
The
SEC has adopted regulations which generally define “penny stock” to be any equity security that has a market price less than
$5.00 per Common Share or an exercise price of less than $5.00 per Common Share, subject to certain exceptions. The Company’s s
securities are covered by the penny stock rules, which impose additional sales practice requirements on broker-dealers who sell to persons
other than established customers and “accredited investors”. The term “accredited investor” refers generally
to institutions with assets in excess of $5,000,000 or individuals with a net worth in excess of $1,000,000, exclusive of their principal
residence, or annual income exceeding $200,000 or $300,000 jointly with their spouse. The penny stock rules require a broker-dealer,
prior to a transaction in a penny stock not otherwise exempt from the rules, to deliver a standardized risk disclosure document in a
form prepared by the SEC which provides information about penny stocks and the nature and level of risks in the penny stock market. The
broker-dealer also must provide the customer with current bid and offer quotations for the penny stock, the compensation of the broker-dealer
and its salesperson in the transaction and monthly account statements showing the market value of each penny stock held in the customer’s
account. The bid and offer quotations, and the broker-dealer and salesperson compensation information, must be given to the customer
orally or in writing prior to effecting the transaction and must be given to the customer in writing before or with the customer’s
confirmation. In addition, the penny stock rules require that prior to a transaction in a penny stock not otherwise exempt from these
rules, the broker-dealer must make a special written determination that the penny stock is a suitable investment for the purchaser and
receive the purchaser’s written agreement to the transaction. These disclosure requirements may have the effect of reducing the
level of trading activity in the secondary market for the stock that is subject to these penny stock rules. Consequently, these penny
stock rules may affect the ability of broker-dealers to trade its securities. The Company believes that the penny stock rules may discourage
investor interest in and limit the marketability of its Common Shares.
The
Company has never paid dividends on its Common Shares.
The
Company has not paid dividends on its Common Shares to date, and it does not expect to pay dividends for the foreseeable future. The
Company intends to retain its initial earnings, if any, to finance its operations. Any future dividends on Common Shares will depend
upon the Company’s earnings, its then-existing financial requirements, and other factors, and will be at the discretion of the
Board.
FINRA
has adopted sales practice requirements, which may also limit an investor’s ability to buy and sell the Company’s Common
Shares.
In
addition to the “penny stock” rules described above, FINRA has adopted rules that require that in recommending an investment
to a customer, a broker-dealer must have reasonable grounds for believing that the investment is suitable for that customer. Prior to
recommending speculative low-priced securities to their non-institutional customers, broker-dealers must make reasonable efforts to obtain
information about the customer’s financial status, tax status, investment objectives and other information. Under interpretations
of these rules, FINRA believes that there is a high probability that speculative low-priced securities will not be suitable for at least
some customers. FINRA requirements make it more difficult for broker-dealers to recommend that their customers buy the Company’s
Common Shares, which may limit an investor’s ability to buy and sell its stock and have an adverse effect on the market for the
Common Shares.
Investors’
interests in the Company will be diluted and investors may suffer dilution in their net book value per share of Common Shares if the
Company issues additional employee/director/consultant options or if the Company sells additional Common Shares and/or warrants to finance
its operations.
In
order to further expand the Company’s operations and meet its objectives, any additional growth and/or expanded exploration activity
will likely need to be financed through sale of and issuance of additional Common Shares, including, but not limited to, raising funds
to explore the Mine. Furthermore, to finance any acquisition activity, should that activity be properly approved, and depending on the
outcome of its exploration programs, the Company likely will also need to issue additional Common Shares to finance future acquisitions,
growth, and/or additional exploration programs of any or all of its projects or to acquire additional properties. The Company will also
in the future grant to some or all of its directors, officers, and key employees and/or consultants options to purchase Common Shares
as non-cash incentives. The issuance of any equity securities could, and the issuance of any additional Common Shares will, cause the
Company’s existing shareholders to experience dilution of their ownership interests.
If
the Company issues additional Common Shares or decides to enter into joint ventures with other parties in order to raise financing through
the sale of equity securities, investors’ interests in the Company will be diluted and investors may suffer dilution in their net
book value per share of Common Shares depending on the price at which such securities are sold.
The
issuance of additional shares of Common Shares may negatively impact the trading price of the Company’s securities.
The
Company has issued Common Shares in the past and will continue to issue Common Shares to finance its activities in the future. In addition,
newly issued or outstanding options, warrants, and broker warrants to purchase Common Shares may be exercised, resulting in the issuance
of additional Common Shares. Any such issuance of additional Common Shares would result in dilution to the Company’s shareholders,
and even the perception that such an issuance may occur could have a negative impact on the trading price of the Common Shares.
The
Company is subject to the continued listing criteria of the CSE, and its failure to satisfy these criteria may result in delisting of
its Common Shares from the CSE.
The
Company’s Common Shares are currently listed for trading on the CSE. In order to maintain the listing on the CSE or any other securities
exchange the Company may trade on, the Company must maintain certain financial and share distribution targets, including maintaining
a minimum number of public shareholders. In addition to objective standards, these exchanges may delist the securities of any issuer
if, in the exchange’s opinion: its financial condition and/or operating results appear unsatisfactory; if it appears that the extent
of public distribution or the aggregate market value of the security has become so reduced as to make continued listing inadvisable;
if the Company sells or disposes of its principal operating assets or ceases to be an operating company; if the Company fails to comply
with the listing requirements; or if any other event occurs or any condition exists which, in their opinion, makes continued listing
on the exchange inadvisable.
If
the CSE, the OTC QB or any other exchange or quotation service were to delist the Common Shares, investors may face material adverse
consequences, including, but not limited to, a lack of trading market for the Common Shares, reduced liquidity, decreased analyst coverage,
and/or an inability for the Company to obtain additional financing to fund its operations.
The
Company faces risks related to compliance with corporate governance laws and financial reporting standards.
The
Sarbanes-Oxley Act of 2002, as well as related new rules and regulations implemented by the SEC and the Public Company Accounting Oversight
Board, require changes in the corporate governance practices and financial reporting standards for public companies. These laws, rules
and regulations, including compliance with Section 404 of the Sarbanes-Oxley Act of 2002 relating to internal control over financial
reporting, referred to as Section 404, materially increase the Company’s legal and financial compliance costs and make certain
activities more time-consuming and burdensome.
PLAN
OF DISTRIBUTION
We
are registering the Common Shares to permit the resale of those Common Shares under the Securities Act from time to time after the date
of this Prospectus at the discretion of the holders of such Common Shares. We will not receive any of the proceeds from the sale by the
selling shareholders of the Common Shares. We will bear all fees and expenses incident to our obligation to register the Common Shares.
Each
selling shareholder and any of their pledgees, assignees and successors-in-interest may, from time to time, sell any or all of their
Common Shares on the CSE, or any other stock exchange, market, quotation service or trading facility on which the shares are traded or
in private transactions, provided that all applicable Canadian laws and other applicable local laws are satisfied. The selling shareholders
may also sell their Common Shares directly or through one or more underwriters, broker-dealers, or agents. If the Common Shares are sold
through underwriters or broker-dealers, the selling shareholders will be responsible for underwriting discounts or commissions or agent’s
commissions. The Common Shares may be sold in one or more transactions at fixed prices, at prevailing market prices at the time of the
sale, at varying prices determined at the time of sale, or at negotiated prices. A selling shareholder may use any one or more of the
following methods when selling shares:
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●
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ordinary
brokerage transactions and transactions in which the broker-dealer solicits purchasers;
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●
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block
trades in which the broker-dealer will attempt to sell the shares as agent but may position and resell a portion of the block as
principal to facilitate the transaction;
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●
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purchases
by a broker-dealer as principal and resale by the broker-dealer for its account;
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●
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an
exchange distribution in accordance with the rules of the applicable exchange;
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●
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privately
negotiated transactions;
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●
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settlement
of short sales entered into after the effective date of the registration statement of which this Prospectus is a part;
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●
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broker-dealers
may agree with the selling shareholders to sell a specified number of such shares at a stipulated price per share;
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●
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through
the writing or settlement of options or other hedging transactions, whether through an options exchange or otherwise;
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●
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a
combination of any such methods of sale; and
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●
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any
other method permitted pursuant to applicable law.
|
The
selling shareholders may also sell shares pursuant to Rule 144 under the Securities Act, if available, rather than under this Prospectus.
If
the selling shareholders effect such transactions by selling Common Shares to or through underwriters, broker-dealers, or agents, such
underwriters, broker-dealers, or agents may receive commissions in the form of discounts, concessions, or commissions from the selling
shareholders or commissions from purchasers of the Common Shares for whom they may act as agent or to whom they may sell as principal
(which discounts, concessions, or commissions as to particular underwriters, broker-dealers, or agents may be in excess of those customary
in the types of transactions involved). Broker-dealers engaged by any selling shareholder may arrange for other brokers-dealers to participate
in sales. Broker-dealers may receive commissions or discounts from the selling shareholder (or, if any broker-dealer acts as agent for
the purchaser of shares, from the purchaser) in amounts to be negotiated, but, except as set forth in a supplement to this Prospectus,
in the case of an agency transaction not in excess of a customary brokerage commission in compliance with FINRA Rule 2440; and in the
case of a principal transaction a markup or markdown in compliance with FINRA IM-2440.
In
connection with sales of Common Shares or interests therein, the selling shareholders may enter into hedging transactions with broker-dealers
or other financial institutions, which may in turn engage in short sales of the Common Shares in the course of hedging in positions they
assume. The selling shareholders may also sell Common Shares short and deliver Common Shares covered by this Prospectus to close out
their short positions and to return borrowed shares in connection with such short sales. The selling shareholders may also loan or pledge
Common Shares to broker-dealers that in turn may sell such Common Shares. The selling shareholders may also enter into option or other
transactions with broker-dealers or other financial institutions or the creation of one or more derivative securities which require the
delivery to such broker-dealer or other financial institution of Common Shares offered by this Prospectus, which Common Shares such broker-dealer
or other financial institution may resell pursuant to this Prospectus (as supplemented or amended to reflect such transaction).
The
selling shareholders and any broker-dealers or agents that are involved in selling the Common Shares may be deemed to be “underwriters”
within the meaning of the Securities Act, in connection with such sales. In such event, any commissions received by, or any discounts
or concessions allowed to, any such broker-dealer or agent and any profit on the resale of any Shares purchased by them may be deemed
to be underwriting commissions or discounts under the Securities Act. At the time a particular offering of the Common Shares is made,
a prospectus supplement, if required, will be distributed that will set forth the aggregate amount of Common Shares being offered and
the terms of the offering, including the name or names of any broker-dealers or agents, any discounts, commissions, and other terms constituting
compensation from the selling shareholders and any discounts, commissions, or concessions allowed or re-allowed or paid to broker-dealers.
Each
selling shareholder has informed us that it does not have any written or oral agreement or understanding, directly or indirectly, with
any person to distribute the Common Shares.
Because
the selling shareholders may be deemed to be “underwriters” within the meaning of the Securities Act, they will be subject
to the prospectus delivery requirements of the Securities Act, including Rule 172 thereunder. Once this registration statement becomes
effective we intend to file the final prospectus with the SEC in accordance with SEC Rules 172 and 424. Provided we are not the subject
of any SEC stop orders and we are not subject to any cease and desist proceedings, the obligation to deliver a final prospectus to a
purchaser will be deemed to have been met.
There
is no underwriter or coordinating broker acting in connection with the proposed sale of the resale shares by the selling shareholders.
Under
the securities laws of some states, the Common Shares may be sold in such states only through registered or licensed brokers or dealers.
In addition, in some states the Common Shares may not be sold unless such shares have been registered or qualified for sale in such state,
or an exemption from registration or qualification is available and is complied with.
There
can be no assurance that any selling shareholder will sell any or all of the Common Shares registered pursuant to the registration statement
of which this Prospectus forms a part.
Under
applicable rules and regulations under the Exchange Act, any person engaged in the distribution of the Common Shares may not simultaneously
engage in market making activities with respect to the Common Shares for the applicable restricted period, as defined in Regulation M,
prior to the commencement of the distribution. In addition, the selling shareholders will be subject to applicable provisions of the
Exchange Act, and the rules and regulations thereunder, including Regulation M, which may limit the timing of purchases and sales of
Common Shares by the selling shareholders or any other person. All of the foregoing provisions may affect the marketability of the Common
Shares and the ability of any person or entity to engage in market-making activities with respect to the Common Shares.
We
will pay all expenses of the registration of the Common Shares, estimated to be approximately $55,000 in total, including, without limitation,
SEC filing fees, expenses of compliance with state securities or “blue sky” laws, and legal and accounting fees; provided,
however, that a selling shareholder will pay all underwriting discounts and selling commissions, if any. We will indemnify the selling
shareholders against liabilities, including some liabilities under the Securities Act, in accordance with applicable registration rights
agreements, if any, or the selling shareholders will be entitled to contribution. We may be indemnified by the selling shareholders against
civil liabilities, including liabilities under the Securities Act, that may arise from any written information furnished to us by the
selling shareholder specifically for use in this Prospectus, in accordance with the related registration rights agreement, or we may
be entitled to contribution.
We
agreed to keep this Prospectus effective until the earlier of (i) the date on which the Common Shares may be resold by the selling shareholders
without registration and without the requirement to be in compliance with Rule 144(c)(1) and otherwise without restriction or limitation
pursuant to Rule 144 or (ii) all of the Common Shares have been sold pursuant to this Prospectus or Rule 144 under the Securities Act
or any other rule of similar effect.
Once
sold under the registration statement of which this Prospectus forms a part, the Common Shares will be freely tradable in the hands of
persons other than our affiliates.
LEGAL
PROCEEDINGS
Other
than as described below, neither the Company nor its property is the subject of any current, pending, or threatened legal proceedings.
The Company is not aware of any other legal proceedings in which any director, officer or affiliate of the Company, any owner of record
or beneficially of more than 5% of any class of the Company’s voting securities, or any associate of any such director, officer,
affiliate or security holder of the Company, is a party adverse to the Company or any of its subsidiaries or has a material interest
adverse to the Company or any of its subsidiaries.
On
or about June 14, 2021, a lawsuit was filed in the US District Court for the District of Idaho brought by a purported personal representative
of the estate of a minority shareholder of Placer Mining. The named defendants include Placer Mining, certain of Placer Mining’s
shareholders, the Company, and certain of the Company’s shareholders. The lawsuit alleges that Placer Mining entered into a series
of transactions, including amendments to the Company’s lease with Placer Mining, in breach of an agreement dated August 31, 2018
which allegedly restricted the sale of shares in Placer Mining by certain shareholders. On August 13, 2021, the Company filed a motion
to dismiss the claim for lack of jurisdiction and standing.
On
July 28, 2021, a lawsuit was filed in the US District Court for the District of Idaho brought by Crescent Mining, LLC (“Crescent”).
The named defendants include Placer Mining, Robert Hopper Jr., and the Company. The lawsuit alleges that Placer Mining and Robert Hopper
Jr. intentionally flooded the Crescent Mine during the period from 1991 and 1994, and that the Company is jointly and severally liable
with the other defendants for unspecified past and future costs associated with the presence of AMD in the Crescent Mine. The plaintiff
has requested unspecified damages.
The
Company believes the claims in both lawsuits, as they relate to Bunker Hill, are without merit and intends to defend them vigorously.
WHERE
YOU CAN FIND ADDITIONAL INFORMATION
We
are subject to the information requirements of the Exchange Act and we therefore file periodic reports, proxy statements and other information
with the SEC relating to our business, financial statements and other matters. The reports, proxy statements and other information we
file may be inspected and copied at prescribed rates at the SEC’s Public Reference Room located at 100 F Street, N.E., Washington,
D.C. 20549. You may obtain information on the operation of the SEC’s Public Reference Room by calling the SEC at 1-800-SEC-0330.
The SEC also maintains web site that contains reports, proxy and information statements and other information regarding issuers like
us that file electronically with the SEC. The address of the SEC’s web site is http://www.sec.gov.
This
prospectus constitutes part of a registration statement filed under the Securities Act with respect to the shares of common stock covered
hereby. As permitted by the SEC’s rules, this prospectus omits some of the information, exhibits and undertakings included in the
registration statement. You may read and copy the information omitted from this prospectus but contained in the registration statement,
as well as the periodic reports and other information we file with the SEC, at the public reference room and web site of the SEC referred
to above. You may also access our filings with the SEC on our web site, which is located at http://www.bunkerhillmining.com/. Except
as specifically incorporated by reference into this Prospectus, the information contained on our web site is not part of this prospectus.
Statements
contained in this prospectus as to the contents of any contract or other document are not necessarily complete, and in each instance
we refer you to the copy of the contract or other document filed or incorporated by reference as an exhibit to the registration statement
or as an exhibit to our Exchange Act filings, each such statement being qualified in all respects by such reference.
INFORMATION
INCORPORATED BY REFERENCE
We
are allowed to incorporate by reference information contained in documents that we file with the SEC. This means that we can disclose
important information to you by referring you to those documents and that the information in this prospectus is not complete and you
should read the information incorporated by reference for more detail. Information in this prospectus supersedes information incorporated
by reference that we filed with the SEC prior to the date of this prospectus, while information that we file later with the SEC will
automatically update and supersede the information in this prospectus.
We
incorporate by reference the documents listed below and any future filings we will make with the SEC under Section 13(a), 13(c), 14 or
15 (d) of the Exchange Act (i) after the date of the initial filing of the registration statement of which this prospectus is a part
and prior to effectiveness of such registration statement and (ii) from the date of this prospectus but prior to the termination of the
offering of the securities covered by this prospectus (other than Current Reports or portions thereof furnished under Item 2.02 or 7.01
of Form 8-K):
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our
Transition Report on Form 10-K for the transition period ended December 31, 2020, filed with the SEC on April 1, 2021;
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our
Quarterly Reports on Form 10-Q for the quarter ended March 31, 2021, filed with the SEC on May 17, 2021, for the quarter ended June
30, 2021, filed with the SEC on August 16, 2021, and for the quarter ended September 30, 2021, filed with the SEC on November
15, 2021;
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our
Current Reports on Form 8-K filed with the SEC on May 4, 2021, September 24, 2021, and November 8, 2021; and
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the
description of our common stock set forth in the registration statement on Form S-1 on December 16, 2020, including any amendments
or reports filed for purposes of updating such description.
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We
will provide to each person, including any beneficial owner, to whom a prospectus is delivered, a copy of any or all of the information
that is incorporated by reference in this prospectus but not delivered with this prospectus, including exhibits that are specifically
incorporated by reference in such documents. You may request a copy of such documents, which will be provided to you at no cost, by writing
or telephoning us at the following address or telephone number:
BUNKER
HILL MINING CORP.
82
Richmond Street East
Toronto,
Ontario, Canada M5C 1P1
Attention:
Chief Financial Officer
Telephone:
416-477-7771
PART
II. INFORMATION NOT REQUIRED IN PROSPECTUS
Item
13. Other Expenses of Issuance and Distribution.
The
estimated expenses of the offering (assuming all shares are sold), all of which are to be paid by the Registrant, are as follows:
|
SEC Registration Fee
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US$
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Printing Expenses
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US$
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1500
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Accounting Fees and Expenses
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US$
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3500
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|
Legal Fees and Expenses
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US$
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20000
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Blue Sky Fees/Expenses
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0
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Transfer Agent Fees
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0
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TOTAL
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$
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Item
14. Indemnification of Directors and Officers.
The
only statute, charter provision, bylaw, contract, or other arrangement under which any controlling person, director or officer of the
Registrant is insured or indemnified in any manner against any liability which he may incur in his capacity as such, is as follows:
Nevada
Law
Section
78.7502 of the Nevada Revised Statutes permits a corporation to indemnify any person who was or is a party or is threatened to be made
a party to any threatened, pending or completed action, suit or proceeding, whether civil, criminal, administrative or investigative,
except an action by or in the right of the corporation, by reason of the fact that he is or was a director, officer, employee or agent
of the corporation, or is or was serving at the request of the corporation as a director, officer, employee or agent of another corporation,
partnership, joint venture, trust or other enterprise, against expenses, including attorneys’ fees, judgments, fines and amounts
paid in settlement actually and reasonably incurred by him in connection with the action, suit or proceeding if he:
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(a)
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is
not liable pursuant to Nevada Revised Statute 78.138, or
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(b)
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acted
in good faith and in a manner which he reasonably believed to be in or not opposed to the best interests of the corporation, and,
with respect to any criminal action or proceeding, had no reasonable cause to believe his conduct was unlawful.
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In
addition, Section 78.7502 permits a corporation to indemnify any person who was or is a party or is threatened to be made a party to
any threatened, pending or completed action or suit by or in the right of the corporation to procure a judgment in its favor by reason
of the fact that he is or was a director, officer, employee or agent of the corporation, or is or was serving at the request of the corporation
as a director, officer, employee or agent of another corporation, partnership, joint venture, trust or other enterprise against expenses,
including amounts paid in settlement and attorneys’ fees actually and reasonably incurred by him in connection with the defense
or settlement of the action or suit if he:
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(a)
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is
not liable pursuant to Nevada Revised Statute 78.138; or
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(b)
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acted
in good faith and in a manner which he reasonably believed to be in or not opposed to the best interests of the corporation.
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To
the extent that a director, officer, employee or agent of a corporation has been successful on the merits or otherwise in defense of
any action, suit or proceeding referred to above, or in defense of any claim, issue or matter, the corporation is required to indemnify
him against expenses, including attorneys’ fees, actually and reasonably incurred by him in connection with the defense.
Section
78.751 of the Nevada Revised Statutes provides that such indemnification may also include payment by the Company of expenses incurred
in defending a civil or criminal action or proceeding in advance of the final disposition of such action or proceeding upon receipt of
an undertaking by the person indemnified to repay such payment if he shall be ultimately found not to be entitled to indemnification
under Section 78.751. Indemnification may be provided even though the person to be indemnified is no longer a director, officer, employee
or agent of the Company or such other entities.
Section
78.752 of the Nevada Revised Statutes allows a corporation to purchase and maintain insurance or make other financial arrangements on
behalf of any person who is or was a director, officer, employee or agent of the corporation or is or was serving at the request of the
corporation as a director, officer, employee or agent of another corporation, partnership, joint venture, trust or other enterprise for
any liability asserted against him and liability and expenses incurred by him in his capacity as a director, officer, employee or agent,
or arising out of his status as such, whether or not the corporation has the authority to indemnify him against such liability and expenses.
Other
financial arrangements made by the corporation pursuant to Section 78.752 may include the following:
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(a)
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the
creation of a trust fund;
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(b)
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the
establishment of a program of self-insurance;
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(c)
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the
securing of its obligation of indemnification by granting a security interest or other lien on any assets of the corporation; and
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(d)
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the
establishment of a letter of credit, guaranty or surety
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No
financial arrangement made pursuant to Section 78.752 may provide protection for a person adjudged by a court of competent jurisdiction,
after exhaustion of all appeals, to be liable for intentional misconduct, fraud or a knowing violation of law, except with respect to
the advancement of expenses or indemnification ordered by a court.
Any
discretionary indemnification pursuant to NRS 78.7502, unless ordered by a court or advanced pursuant to an undertaking to repay the
amount if it is determined by a court that the indemnified party is not entitled to be indemnified by the corporation, may be made by
the corporation only as authorized in the specific case upon a determination that indemnification of the director, officer, employee
or agent is proper in the circumstances. The determination must be made:
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(b)
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by
the board of directors by majority vote of a quorum consisting of directors who were not parties to the action, suit or proceeding;
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(c)
|
if
a majority vote of a quorum consisting of directors who were not parties to the action, suit or proceeding so orders, by independent
legal counsel in a written opinion, or
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(d)
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if
a quorum consisting of directors who were not parties to the action, suit or proceeding cannot be obtained, by independent legal
counsel in a written opinion.
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The
articles of incorporation and bylaws limit director liability and provide for indemnification to the fullest extent provided by Nevada
law.
Item
15 Recent Sales of Unregistered Securities
On
November 20, 2017, the Company issued 1,366,320 (non-consolidated) shares in a private placement transaction at a purchase price of C
$1.25 per share in a transaction that was exempt from registration under Regulation D for section 4 (a) (2) of the Securities Act of
1933 or Regulation S for transactions outside of the United States.
On
December 1, 2017, the Company issued 204,000 (non-consolidated) shares in a private placement transaction at a purchase price of C $1.25
per share in a transaction that was exempt from registration under Regulation D for section 4 (a) (2) of the Securities Act of 1933 or
Regulation S for transactions outside of the United States.
On
December 6, 2017, the Company issued 4,000,000 (non-consolidated) shares in a private placement transaction at a purchase price of C
$1.25 per share in a transaction that was exempt from registration under Regulation S for transactions outside of the United States.
On
December 11, 2017, the Company issued 390,000 (non-consolidated) shares in a private placement transaction at a purchase price of C $1.25
per share in a transaction that was exempt from registration under Regulation D for section 4 (a) (2) of the Securities Act of 1933 or
Regulation S for transactions outside of the United States.
On
August 8, 2018, the Company issued 1,604,076 (non-consolidated) shares in a private placement transaction at a purchase price of C $0.45
per share in a transaction that was exempt from registration under Regulation S for transactions outside of the United States.
On
November 27, 2018, the Company issued 6,058,664 (non-consolidated) shares in a private placement transaction at a purchase price of C
$0.075 per share in a transaction that was exempt from registration under Regulation S for transactions outside of the United States.
On
November 28, 2018, the Company issued 400,000 (non-consolidated) shares in a private placement transaction at a purchase price of C $0.075
per share in a transaction that was exempt from registration under Regulation S for transactions outside of the United States.
On
June 27, 2019, the Company issued 11,660,000 (non-consolidated) shares in a private placement transaction at a purchase price of C $0.05
per share in a transaction that was exempt from registration under Regulation S for transactions outside of the United States.
On
August 1, 2019, the Company issued 23,769,000 (non-consolidated) shares in a private placement transaction at a purchase price of C $0.05
per share in a transaction that was exempt from registration under Regulation D for section 4 (a) (2) of the Securities Act of 1933 or
Regulation S for transactions outside of the United States.
On
August 23, 2019, the Company issued 31,912,000 (non-consolidated) shares in a private placement transaction at a purchase price of C
$0.05 per share in a transaction that was exempt from registration under Regulation D for section 4 (a) (2) of the Securities Act of
1933 or Regulation S for transactions outside of the United States.
On
August 30, 2019, the Company issued 1,000,000 (non-consolidated) shares in a private placement transaction at a purchase price of C $0.05
per share in a transaction that was exempt from registration under Regulation S for transactions outside of the United States.
On
February 25, 2020, the Company issued 3,687,501 shares in a private placement transaction at a purchase price of C $0.56 per share in
a transaction that was exempt from registration under Regulation S for transactions outside of the United States.
On
May 12, 2020, the Company issued 3,687,501 shares in a private placement transaction at a purchase price of C $0.56 per share in a transaction
that was exempt from registration under Regulation S for transactions outside of the United States.
On
August 14, 2020, the Company issued 35,212,142 shares and 35,212,142 warrants in a private placement transaction at a purchase price
of C $0.35 per share in a transaction that was exempt from registration under Regulation D for section 4 (a) (2) of the Securities Act
of 1933 or Regulation S for transactions outside of the United States.
On
August 25, 2020, the Company issued 10,940,534 shares and 10,940,534 warrants in a private placement transaction at a purchase price
of C $0.35 per share in a transaction that was exempt from registration under Regulation D for section 4 (a) (2) of the Securities Act
of 1933 or Regulation S for transactions outside of the United States.
Sprott
Capital Partners LP and Cormark Securities Inc. (the “Agents”) acted as agents in connection with the latter two placements
and were paid a cash commission of C$1,086,685 in the aggregate and were issued 3,239,907 compensation warrants (“Broker Warrants”)
as compensation for their services. Broker Warrants are exercisable into Units at an exercise price equal to C$0.35 until August 31,
2023.
On
February 24, 2021, the Company closed a non-brokered private placement of 19,994,080 Units of the Company at $0.40 per Unit for gross
proceeds of approximately C$8,000,000 in a transaction that was exempt from registration under Regulation D for section 4 (a) (2) of
the Securities Act of 1933 or Regulation S for transactions outside of the United States. Each Unit consists of one Common Share of the
Company and one Common Share purchase warrant. Each whole warrant entitles the holder to acquire one Common Share of the Company at a
price of C$0.60 per Common Share for a period of five years.
Item
16. Exhibits.
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3.1
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Articles
of Incorporation (included as exhibit to Form S-1 filed with the Securities and Exchange Commission on April 1, 2008).
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3.2
|
Bylaws
(included as exhibit to Form S-1 filed with the Securities and Exchange Commission on April 1, 2008).
|
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3.3
|
Articles of Amendment (included as exhibit to Form 8-K filed with the Securities and Exchange Commission on February 12, 2010).
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3.3
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Amended Bylaws (included as exhibit to Form 8-K filed with the Securities and Exchange Commission on October 25, 2010).
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3.4
|
Amended and Restated Bylaws of Liberty Silver Corp., December 14, 2011 (included as exhibit to Form 8-K filed with the Securities and Exchange Commission on December 14, 2011).
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3.5
|
Amended and Restated Articles of Incorporation of Liberty Silver Corp, (included as exhibit to Form 8-K filed with the Securities and Exchange Commission on December 28, 2012)
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3.6
|
Amended and Restated Bylaws of Liberty Silver Corp., dated December 21, 2012. (included as exhibit to Form 8-K filed with the Securities and Exchange Commission on December 28, 2012)
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3.7
|
Certificate of Amendment to Articles of Incorporation for Nevada Profit Corporations, effective September 29, 2017 (included as an exhibit to the Form 8-K filed with the Securities and Exchange Commission on September 18, 2017).
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3.8
|
Amended and Restated Articles of Incorporation of Liberty Silver Corp.*
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3.9
|
Amended and Restated Articles of Incorporation of Liberty Silver Corp.*
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3.10
|
Certificate of Change dated May 1, 2019*
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3.11
|
Certificate of Amendment dated September 11, 2020*
|
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4.1
|
Warrant Indenture dated as of August 14, 2020*
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|
5.1
|
Opinion regarding Legality**
|
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10.1
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Mineral Property Purchase Agreement corporation (included as exhibit to Form S-1 filed with the Securities and Exchange Commission on April 1, 2008).
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10.2
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Exploration Earn-In Agreement dated March 29, 2010, by and between Liberty Silver Corp, a Nevada corporation, and AuEx Ventures, Inc., a Nevada corporation (included as exhibit to Form S-1/A filed with the Securities and Exchange Commission on February 19, 2013).
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10.3
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Purchase Agreement Hi Ho Silver Mining Claims dated October 15, 2012 (included as exhibit to Form S-1/A filed with the Securities and Exchange Commission on January 24, 2013).
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10.4
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Registration Rights Agreement dated October 15, 2012 (included as exhibit to Form 8-K filed with the Securities and Exchange Commission on October 16, 2012).
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10.5
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Memorandum of Exploration Earn-In Agreement, effective March 29, 2010 (included as exhibit to Form S-1/A filed with the Securities and Exchange Commission on January 24, 2013).
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10.6
|
Letter Agreement re Assignment of Exploration Earn-In Agreement, effective July 1, 2010 (included as exhibit to Form S-1/A filed with the Securities and Exchange Commission on January 24, 2013).
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10.7
|
Mining Lease with Option to Purchase, by and between Liberty Silver Corp. and Placer Mining Corporation, dated August 17, 2017 (included as exhibits to Form 8-K filed with the Securities and Exchange Commission on August 23, 2017).
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10.8
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Standstill Agreement dated May 16, 2017 (included as an exhibit to Form 8-K filed with the Securities and Exchange Commission on May 25, 2017).
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10.9
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First Amendment to the Amended and Restated Loan Agreement and Notice, dated January 20, 2017 (included as exhibits to the Form 8-K filed with the Securities and Exchange Commission on January 24, 2017).
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10.10
|
Settlement Agreement with EPA*
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10.11
|
Lease with Option to Purchase dated November 1, 2017*
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10.12
|
Lease Amendment*
|
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10.13
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Clarification and Second Amendment to Lease*
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10.14
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Reinstatement and Amendment to Lease*
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|
10.15
|
Fourth Amendment to Lease*
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10.16
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Notice of intention to extend the Lease*
|
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10.17
|
Second Agreement to Extend Lease*
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10.18
|
Notice of Lease Extension*
|
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23.1
|
Consent of MNP LLP**
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23.2
|
Consent of J.P. Galda & Co. (Included in Exhibit 5)**
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23.3
|
Consent of Deepak Malhorta, PhD.**
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23.4
|
Consent of Robert H. Todd**
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23.5
|
Consent of Scott E. Wilson**
|
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96.1
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Technical Report and Preliminary Economic Assessment for Ungergrioupnd Milling and Concentration of Lead, Zinc and Silver at the Bunker Hill Mine, November 3, 2021 (incorporated by reference to Form 8-K dated November 8, 2021
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Item
17. Undertakings.
A.
The undersigned Registrant hereby undertakes:
(1)
To file, during any period in which offers or sales are being made, a posteffective amendment to this Registration Statement to:
(a)
include any prospectus required by Section 10(a)(3) of the Securities Act;
(b)
reflect in the prospectus any facts or events arising after the effective date of this Registration Statement (or the most recent post
effective amendment thereof) which, individually or in the aggregate, represent a fundamental change in the information set forth in
this Registration Statement. Notwithstanding the foregoing, any increase or decrease in the volume of securities offered (if the total
dollar value of securities offered would not exceed that which was registered) and any deviation from the low or high end of the estimated
maximum offering range may be reflected in the form of prospectus filed with the Commission pursuant to Rule 424(b) under the Securities
Act if, in the aggregate, the changes in volume and price represent no more than a 20% change in maximum aggregate offering price set
forth in the “Calculation of Registration Fee” table in the effective Registration Statement; and
(c)
include any additional or changed material information with respect to the plan of distribution.
(2)
That, for the purpose of determining any liability under the Securities Act, each such posteffective amendment shall be deemed to be
a new registration statement relating to the securities offered herein, and the offering of such securities at that time shall be deemed
to be the initial bona fide offering thereof.
(3)
To remove from registration by means of a posteffective amendment any of the securities being registered which remain unsold at the termination
of the offering.
(4)
For purposes of determining any liability under the Securities Act, the information omitted from the form of prospectus filed as part
of a registration statement in reliance upon Rule 430A and contained in the form of prospectus filed by the Registrant pursuant to Rule
424(b)(1) or (4) or 497(h) under the Securities Act shall be deemed to be part of the Registration Statement as of the time it was declared
effective.
(5)
For the purpose of determining any liability under the Securities Act, each posteffective amendment that contains a form of prospectus
shall be deemed to be a new Registration Statement relating to the securities offered therein, and the offering of such securities at
that time shall be deemed to be the initial bona fide offering thereof.
(6)
For the purpose of determining liability under the Securities Act to any purchaser:
Each
prospectus filed pursuant to Rule 424(b) under the Securities Act as part of a registration statement relating to an offering, other
than registration statements relying on Rule 430B or other than prospectuses filed in reliance on Rule 430A (§§230.430A of
this chapter), shall be deemed to be part of and included in the Registration Statement as of the date it is first used after effectiveness.
Provided however, that no statement made in a registration statement or prospectus that is part of the Registration Statement or made
in a document incorporated or deemed incorporated by reference into the registration statement or prospectus that is part of the Registration
Statement will, as to a purchaser with a time of contract of sale prior to such first use, supersede or modify any statement that was
made in the registration statement or prospectus that was part of the Registration Statement or made in any such document immediately
prior to such date of first use.
(7)
For the purpose of determining liability of the Registrant under the Securities Act to any purchaser in the initial distribution of securities:
The
Registrant undertakes that in a primary offering of securities of the Registrant pursuant to this Registration Statement, regardless
of the underwriting method used to sell the securities to the purchaser, if the securities are offered or sold to such purchaser by means
of any of the following communications, the Registrant will be a seller to the purchaser and will be considered to offer or sell such
securities to such purchaser:
(a)
Any preliminary prospectus or prospectus of the Registrant relating to the offering required to be filed pursuant to Rule 424 of this
chapter;
(b)
Any free writing prospectus relating to the offering prepared by or on behalf of the Registrant or used or referred to by the Registrant;
(c)
The portion of any other free writing prospectus relating to the offering containing material information about the Registrant or its
securities provided by or on behalf of the Registrant; and
(d)
Any other communication that is an offer in the offering made by the Registrant to the purchaser.
B.
Insofar as indemnification for liabilities arising under the Securities Act may be permitted to directors, officers and controlling
persons of the Company pursuant to the foregoing provisions, or otherwise, the Company has been advised that in the opinion of the Securities
and Exchange Commission such indemnification is against public policy as expressed in the Securities Act and is, therefore, unenforceable.
In the event that a claim for indemnification against such liabilities (other than the payment by the small business issuer of expenses
incurred or paid by a director, officer or controlling person of the small business issuer in the successful defense of any action, suit
or proceeding) is asserted by such director, officer or controlling person in connection with the securities being registered, the Company
will, unless in the opinion of its counsel the matter has been settled by controlling precedent, submit to a court of appropriate jurisdiction
the question whether such indemnification by it is against public policy as expressed in the Securities Act and will be governed by the
final adjudication of such issue.
C.
The undersigned Registrant hereby undertakes that:
(1)
For purposes of determining any liability under the Securities Act of 1933, the information omitted from the form of prospectus filed
as part of this Registration Statement in reliance upon Rule 430A and contained in a form of prospectus filed by the registrant pursuant
to Rule 424(b)(1) or (4) or 497(h) under the Securities Act shall be deemed to be part of this Registration Statement as of the time
it was declared effective.
(2)
For the purpose of determining any liability under the Securities Act of 1933, each posteffective amendment that contains a form of prospectus
shall be deemed to be a new registration statement relating to the securities offered therein, and the offering of such securities at
that time shall be deemed to be the initial bona fide offering thereof.