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Item 5.02
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Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of
Certain Officers.
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On September 28, 2021,
Darren Klinck was appointed by the board of directors of Silver Bull Resources, Inc. (the “Company”) as its President, effective
as of October 1, 2021, replacing Timothy Barry in such role on that date. Timothy Barry remains the Chief Executive Officer of the
Company.
Mr. Klinck, 45, most
recently served as President (August 2017–April 2021) and Chief Executive Officer (August 2017–January 2020) of Bluestone
Resources Inc. From April 2007 to June 2017, he served in numerous roles at OceanaGold Corporation, including Executive Vice President
and Head of Corporate Development, Head of Business Development, and Vice President of Corporate and Investor Relations. Mr. Klinck
has served as a director of ValOre Metals Corp. since June 1, 2021, as a director of Gold Basin Resources Corp. since September 9,
2021, and as the President and a director of Arras Minerals Corp. since October 1, 2021. In addition, he served as a director of
Bluestone Resources Inc. from August 2017 to April 2021. Mr. Klinck has a Bachelor of Commerce degree from the Haskayne School of
Business at The University of Calgary. There are no family relationships between Mr. Klinck and any director or executive officer
of the Company, and there are no transactions between Mr. Klinck and the Company that require disclosure pursuant to Item 404
of Regulation S-K.
On October 1, 2021,
the Company entered into a consulting agreement (the “Consulting Agreement”) with Mr. Klinck’s personal service
corporation, Westcott Management Ltd. (“Westcott”), pursuant to which Mr. Klinck will serve as the President of the Company.
Pursuant to the terms and conditions of the Consulting Agreement, Westcott will receive an annual fee of C$50,000 (the “Consulting
Fee”) and will be eligible to participate in the Company’s annual bonus plans during the term of the Consulting Agreement.
Westcott will further be eligible to receive a retention bonus (each, a “Retention Bonus”) as follows, subject to Mr. Klinck’s
continued service with the Company through the applicable payment date and the achievement of the applicable market capitalization targets
by April 15, 2027: (i) an amount of C$500,000, subject to the Company’s market capitalization reaching at least C$250,000,000
for five consecutive trading days, (ii) an amount of C$500,000, subject to the Company’s market capitalization reaching at
least C$500,000,000 for five consecutive trading days, and (iii) an amount of C$1,000,000, subject to the Company’s market
capitalization reaching at least C$1,000,000,000 for five consecutive trading days. In addition, in the event that, on or prior to April 15,
2027, the Company is subject to a successful takeover bid exceeding C$250,000,000, Wescott will receive a cash bonus equal to 0.2% of
the bid price, less any Retention Bonus previously paid to Wescott pursuant to the Consulting Agreement. In the event that the Company
does not have the funds necessary to pay any Retention Bonus (including any bonus payable upon a successful takeover bid), Wescott shall
accrue interest at 5% per annum compounded on any such unpaid amount until the full payment of any such amount plus interest, provided
that the Company may settle any such amount by issuing shares of the Company to Wescott valued at the 20-trading volume-weighted average
price for the Company’s shares on the market calculated up to the day before the issuance of the shares, less 5%.
The Consulting Agreement
further provides that the Company shall reimburse Wescott for any direct out-of-pocket expenses incurred in connection with Wescott’s
services under the Consulting Agreement and will pay for (or reimburse) any insurance plan premiums for Mr. Klinck’s medical,
dental, term life, liability and disability insurance.
In the event that the Consulting
Agreement is terminated by the Company without “cause” or by Wescott for “good reason” (as such terms are defined
in the Consulting Agreement), Wescott is entitled to the following amounts, payable in a lump sum: (i) in the event that the Consulting
Agreement is terminated prior to October 1, 2022, six months of the Consulting Fee, and (ii) in the event that the Consulting
Agreement is terminated on or after October 1, 2022, six months of the Consulting Fee plus one month of the Consulting Fee for each
additional year of service from October 1, 2021, up to a maximum of 12 months of the Consulting Fee. If the Company terminates
the Consulting Agreement without “cause” within three months following a “change of control” (as such term is
defined in the Consulting Agreement), Wescott is entitled to 24 months of the Consulting Fee plus a lump-sum payment equal to the
previous annual cash bonus paid to Wescott (such payment, the “Change of Control Payment”). In addition, Wescott has the right
to terminate the Consulting Agreement for any reason within three months following a “change of control” and receive the Change
of Control Payment from the Company.
The Consulting Agreement
contains certain restrictive covenants, including a non-competition covenant and employee and customer non-solicitation covenant applicable
during the term of the Consulting Agreement and for six months following the termination thereof.
The foregoing description
of the Consulting Agreement does not purport to be complete and is qualified in its entirety by reference to the full text of the Consulting
Agreement, a copy of which is filed as Exhibit 10.1 to this Current Report on Form 8-K and incorporated herein by reference.