SVBL Silver Bull Resources Inc (QB)

United States

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-K

(Mark One)

Commission File Number: 001-33125

SILVER BULL RESOURCES, INC.

(Exact name of registrant as specified in its charter)

777 Dunsmuir Street, Suite 1605

Vancouver, B.C. V7Y 1K4

(Address of principal executive offices, including zip code)

Registrant’s telephone number, including area code: (604) 687-5800

Securities registered pursuant to Section 12(b) of the Act: None

Securities registered pursuant to Section 12(g) of the Act: Common Stock, $0.01 Par Value

Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act

Yes ☐ No ☒

Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or 15(d) of the Exchange Act.

Yes ☐ No ☒

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.

Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).

Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant has filed a report on and attestation to its management’s assessment of the effectiveness of its internal control over financial reporting under Section 404(b) of the Sarbanes-Oxley Act (15 U.S.C. 7262(b)) by the registered public accounting firm that prepared or issued its audit report. ☐

If securities are registered pursuant to Section 12(b) of the Act, indicate by check mark whether the financial statements of the registrant included in the filing reflect the correction of an error to previously issued financial statements. ☐

Indicate by check mark whether any of those error corrections are restatements that required a recovery analysis of incentive-based compensation received by any of the registrant’s executive officers during the relevant recovery period pursuant to §240.10D-1(b). ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).

Yes ☐ No ☒

As of January 26, 2024, there were 47,365,652 shares outstanding of the registrant’s $0.01 par value common stock, the registrant’s only outstanding class of voting securities. As of April 30, 2023, the aggregate market value of the registrant’s voting common stock held by non-affiliates of the registrant was approximately $5.5   million based upon the closing sale price of the common stock as reported by the OTCQB. For the purpose of this calculation, the registrant has assumed that its affiliates as of April 30, 2023 included all directors and officers.

DOCUMENTS INCORPORATED BY REFERENCE

SILVER BULL RESOURCES, INC.

ANNUAL REPORT ON FORM 10-K

TABLE OF CONTENTS

The terms “Silver Bull,” and the “Company,” are used to refer to Silver Bull Resources, Inc. and its subsidiaries, unless the context otherwise requires. Technical terms have been included that are important to an understanding of the business under “Glossary of Common Terms” at the end of this section. Throughout this document statements are made that are classified as “forward-looking.” Please refer to the “Cautionary Statement Regarding Forward-Looking Statements” section of this document for an explanation of these types of assertions.

Cautionary Statement Regarding Forward-Looking Statements

This Annual Report on Form 10-K includes certain statements that may be deemed to be “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended (the “Securities Act”), Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), and the United States Private Securities Litigation Reform Act of 1995, and “forward-looking information” within the meaning of applicable Canadian securities legislation. Words used such as “anticipate,” “continue,” “likely,” “estimate,” “expect,” “may,” “will,” “projection,” “should,” “believe,” “potential,” “could,” or similar words suggesting future outcomes (including negative and grammatical variations) to identify forward-looking statements. These statements include statements regarding the following, among other things:

• The sufficiency of existing cash resources to enable the Company to continue operations for the next 12 months as a going concern;
• The prospects of the claim process, or award, under the North American Free Trade Agreement (“NAFTA”);
• The Funding Agreement (as defined in the “Management’s Discussion and Analysis of Financial Condition and Results of Operations” section), and continued payment of legal, tribunal and external expert costs, and reimbursement of corporate operating expenses, under its terms;
• Prospects of entering the development or production stage with respect to any of the Company’s projects;
• The planned activities at the Sierra Mojada Project in 2024 and beyond;
• Whether any part of the Sierra Mojada Project will ever be confirmed or converted into SEC S-K 1300-compliant mineral reserves;
• The requirement of additional power supplies for the Sierra Mojada Project if a mining operation is determined to be feasible;
• The ability to obtain and hold additional concessions in the Sierra Mojada Project area;
• Whether the Company will be required to obtain additional surface rights if a mining operation is determined to be feasible;
• The possible impact on the Company’s operations of the blockade by a cooperative of miners on the Sierra Mojada property;
• The potential acquisition of additional mineral properties or property concessions;
• Testing of the impact of the fine bubble flotation test work on the recovery of minerals and initial rough concentrate grade;
• The impact of recent accounting pronouncements on the Company’s financial position, results of operations or cash flows and disclosures;
• The impact of changes to current state or federal laws and regulations on estimated capital expenditures, the economics of a particular project and/or the Company’s activities;
• The Company’s ability to raise additional capital and/or pursue additional strategic options, and the potential impact on its business, financial condition and results of operations of doing so or not;
• The impact of changing foreign currency exchange rates on the Company’s financial condition;

• The impairment of concession and likelihood of further impairment of other long-lived assets;

• Whether using major financial institutions with high credit ratings mitigates credit risk;
• The impact of changing economic conditions on interest rates;
• Expectations regarding future recovery of value-added taxes (“VAT”) paid in Mexico; and
• The merits of any claims in connection with, and the expected timing of any, ongoing legal proceedings.

These statements are based on certain assumptions and analyses made by the Company in light of its experience and perception of historical trends, current conditions, expected future developments and other factors it believes are appropriate in the circumstances. Such statements are subject to a number of assumptions, risks and uncertainties and actual results could differ from those expressed or implied in these forward-looking statements as a result of the factors described under “Risk Factors” in this Annual Report on Form 10-K, including:

• The Company’s ability to acquire additional mineral properties or property concessions;
• The ability of the Company to maintain its assets in Mexico given the performance of the Mexican government at various levels;
• Worldwide economic and political events affecting (i) the market prices for silver, zinc, lead, copper and other minerals that may be found on the Company’s exploration properties (ii) interest rates and (iii) foreign currency exchange rates;
• Outbreaks of disease, including the COVID-19 pandemic, and related stay-at-home orders, quarantine policies and restrictions on travel, trade and business operations;
• The amount and nature of future capital and exploration expenditures;
• Volatility in the Company’s stock price;
• The Company’s inability to obtain required permits;
• Competitive factors, including exploration-related competition;
• Timing of receipt and maintenance of government approvals;
• Unanticipated title issues;
• Changes in tax laws;
• Changes in regulatory frameworks or regulations affecting the Company’s activities;
• The ability to obtain additional financial resources on acceptable terms to (i) maintain its property concessions in Mexico and (ii) maintain general and administrative expenditures at acceptable levels;
• The Company’s ability to retain key management, consultants and experts necessary to successfully operate and grow its business; and
• Political and economic instability in Mexico and other countries in which the Company conducts its business, and future potential actions of the governments in such countries with respect to nationalization of natural resources or other changes in mining or taxation policies.

These factors are not intended to represent a complete list of the general or specific factors that could affect the Company.

All forward-looking statements speak only as of the date made. All subsequent written and oral forward-looking statements attributable to the Company, or persons acting on its behalf, are expressly qualified in their entirety by the cautionary statements. Except as required by law, the Company undertakes no obligation to update any forward-looking statement to reflect events or circumstances after the date on which it is made or to reflect the occurrence of anticipated or unanticipated events or circumstances. Undue reliance should not be placed on these forward-looking statements.

Cautionary Note Regarding Exploration Stage Companies

Silver Bull is an exploration stage company and does not currently have any known mineral reserves and cannot be expected to have known mineral reserves unless and until a feasibility study is completed for the Sierra Mojada concessions that shows proven and probable mineral reserves. There can be no assurance that the Company’s concessions contain proven and probable mineral reserves and investors may lose their entire investment. See the “Risk Factors” section below.

Cautionary Note to U.S. Residents Concerning Disclosure of Mineral Resources

Silver Bull is a U.S. domestic issuer for United States Securities and Exchange Commission (“SEC”) purposes, most of its shareholders are U.S. residents, it is required to report its financial results under accounting principles generally accepted in the United States of America, and its shares of common stock are listed on the Toronto Stock Exchange (the “TSX”) and trade on the OTCQB marketplace. However, because Silver Bull is a reporting issuer in Canada, certain prior regulatory filings required in Canada contain or incorporate by reference therein certain disclosure that satisfies the additional requirements of Canadian securities laws, which differ from the requirements of United States’ securities laws. Unless otherwise indicated, all resource estimates included in those Canadian filings, and in the documents incorporated by reference therein, had been prepared in accordance with Canadian National Instrument 43-101 - Standards of Disclosure for Mineral Projects (“NI 43-101”) and the Canadian Institute of Mining, Metallurgy and Petroleum (“CIM”) classification system. NI 43-101 is a rule developed by the Canadian Securities Administrators which establishes standards for all public disclosure an issuer makes of scientific and technical information concerning mineral projects.

Canadian standards, including NI 43-101, may differ from the requirements of subpart 1300 of Regulation S-K, as defined in the Glossary of Technical Terms (“S-K 1300”). Thus, resource information contained, or incorporated by reference, in the Company’s Canadian filings, and in the documents incorporated by reference therein, may not be comparable to similar information disclosed by companies reporting mineral reserve and mineral resource information under S-K 1300.

The terms “mineral reserve”, “proven mineral reserve” and “probable mineral reserve” are Canadian mining terms as defined in accordance with NI 43-101 and CIM standards. Pursuant to S-K 1300, the SEC recognizes estimates of “measured mineral resources,” “indicated mineral resources” and “inferred mineral resources.” In addition, the SEC has amended its definitions of “proven mineral reserves” and “probably mineral reserves” to be substantially similar to the corresponding standards of the CIM.

Investors are cautioned that while terms are substantially similar to CIM standards, there are differences in the definitions and standards under S-K 1300 and the CIM standards. Accordingly, there is no assurance any mineral reserves or mineral resources that the Company may report as “proven reserves”, “probable reserves”, “measured mineral resources”, “indicated mineral resources” and “inferred mineral resources” under NI 43-101 will be the same as the reserve or resource estimates prepared under the standards adopted under S-K 1300.

Investors are also cautioned that while the SEC now recognizes “measured mineral resources,” “indicated mineral resources” and “inferred mineral resources”, investors should not assume that any part or all of mineral deposits in these categories will ever be converted into reserves. Mineralization described using these terms has a great amount of uncertainty as to their existence, and great uncertainty as to their economic and legal feasibility. It cannot be assumed that all or any part of an “measured mineral resource,” “indicated mineral resource” or “inferred mineral resource” will ever be upgraded to a higher category. Under Canadian rules, estimates of inferred mineral resources may not form the basis of feasibility or pre-feasibility studies, except in rare cases. Investors are cautioned not to assume that all or any part of an inferred mineral resource exists or is economically or legally mineable. Disclosure of “contained ounces” in a resource is permitted disclosure under Canadian regulations; however, the SEC normally only permits issuers to report mineralization that does not constitute “reserves” by SEC standards as in place tonnage and grade without reference to unit measures.

Technical Report Summaries and Qualified Persons

The scientific and technical information concerning the Company’s mineral projects in this Annual Report on Form 10-K have been reviewed and approved by “qualified persons” under S-K 1300, including the Company’s Chief Executive Officer and Director, Timothy Barry and the Company’s Director, David Underwood. For a description of the key assumptions, parameters and methods used to estimate mineral reserves and mineral resources included in this Annual Report on Form 10-K, as well as data verification procedures and a general discussion of the extent to which the estimates may be affected by any known environmental, permitting, legal, title, taxation, sociopolitical, marketing or other relevant factors, please review the Technical Report Summaries for each of the Company’s material properties which are included as exhibits to, and incorporated by reference into, this Annual Report on Form 10-K.

Glossary of Common Terms

The following terms are used throughout this Annual Report on Form 10-K.

PART I

Items 1 and 2. BUSINESS AND PROPERTIES

Overview and Corporate Structure

Silver Bull Resources, Inc. was incorporated in the State of Nevada on November 8, 1993 as the Cadgie Company for the purpose of acquiring and developing mineral properties. The Cadgie Company was a spin-off from its predecessor, Precious Metal Mines, Inc. On June 28, 1996, the Company’s name was changed to Metalline Mining Company (“Metalline”). On April 21, 2011, the Company’s name was changed to Silver Bull Resources, Inc. The Company has not realized any revenues from its planned operations, and is considered an exploration stage company. The Company has not established any reserves with respect to its exploration projects and may never enter into the development stage with respect to any of its projects.

The Company has been engaged in the business of mineral exploration. It owns a number of property concessions in Mexico within a mining district known as the Sierra Mojada District, located in the west–central part of the state of Coahuila, Mexico. Operations are conducted in Mexico through the Company’s wholly-owned subsidiary corporations, Minera Metalin S.A. de C.V. (“Minera Metalin”), and Minas de Coahuila SBR S.A. de C.V (“Minas”).

In April 2010, Metalline Mining Delaware, Inc., a wholly-owned subsidiary incorporated in the State of Delaware, was merged with and into Dome Ventures Corporation (“Dome”), a Delaware corporation. As a result, Dome became a wholly-owned subsidiary of Silver Bull. Dome has a wholly-owned subsidiary, Dome Asia Inc., which is incorporated in the British Virgin Islands.

On June 5, 2015, the Company announced its decision to voluntarily delist its shares of common stock from the NYSE MKT due to costs associated with the continued listing and NYSE MKT exchange rules regarding maintenance of a minimum share price. On June 29, 2015, the Company’s shares began trading on the OTCQB marketplace operated by OTC Markets Group. The Company’s shares of common stock continue to trade on the TSX.

On August 12, 2020, the Company entered into an option agreement (the “Beskauga Option Agreement”) with Copperbelt AG, a corporation existing under the laws of Switzerland (“CB Parent”), and Dostyk LLP, an entity existing under the laws of Kazakhstan and a wholly-owned subsidiary of CB Parent (the “CB Sub,” and together with CB Parent, “CB”), pursuant to which the Company had the exclusive right and option to acquire CB’s right, title and 100% interest in the Beskauga property located in Kazakhstan, which consists of the Beskauga Main project (the “Beskauga Main Project”) and the Beskauga South project (the “Beskauga South Project,” and together the Beskauga Main Project, the “Beskauga Project”). The transaction contemplated by the Beskauga Option Agreement closed on January 26, 2021.

On February 5, 2021, Arras Minerals Corp. (“Arras”) was incorporated in British Columbia, Canada, as a wholly-owned subsidiary of Silver Bull. On March 19, 2021, pursuant to an asset purchase agreement with Arras, Silver Bull transferred its right, title and interest in and to the Beskauga Option Agreement, among other things, to Arras. On September 24, 2021, Silver Bull distributed to its shareholders one Arras common share for each Silver Bull share held by such shareholders, or 34,547,838 Arras common shares in total (the “Distribution”). Upon completion of the Distribution, the Company retained 1,452,162 Arras common shares, or approximately 4% of the outstanding Arras common shares, as a strategic investment, and Arras became a stand-alone company.

In December 2021 and June 2022, the Company sold 600,000 and 852,262 common shares of Arras at a price of $CDN 1.00 and $CDN 1.50 per share, respectively. Since then, the Company has not held any interest in Arras.  

On April 23, 2023, Nomad Minerals Ltd. (“Nomad Minerals”), a wholly-owned subsidiary of the Company, was incorporated in British Columbia, Canada. On April 28, 2023, Nomad Metals Limited was incorporated at Astana International Financial Centre in Astana, Republic of Kazakhstan, as a wholly-owned subsidiary of Nomad Minerals.

On June 28, 2023, the Company filed a request for arbitration (the “Arbitration”) before the World Bank’s International Centre for Settlement of Investment Disputes (“ICSID”) against the United Mexican States (“Mexico”) under the United States-Mexico-Canada Agreement (the “USMCA”) and NAFTA, (together with the USMCA, the “Treaties”).   Since the arbitration request, the ICSID arbitration has become the Company’s core focus. The ICSID arbitration seeks compensation for the losses resulting from the Mexican State’s wrongful conduct and its breaches of the Treaties’ protections, including expropriation, breach of the fair and equitable treatment standard, discrimination, and other unlawful treatment in respect of the Sierra Mojada Property. If successful in the ICSID arbitration, the Company will take appropriate steps to enforce and recover such an arbitral award (“Award”). The execution and enforcement of an Award may present material challenges and take a number of years.

The Company’s efforts and expenditures have been concentrated in the exploration of properties, principally the Sierra Mojada property located in Coahuila, Mexico (the “Sierra Mojada Property”). Silver Bull has not determined whether its exploration properties contain ore reserves that are economically recoverable. The ultimate realization of investment in exploration properties is dependent upon the success of future property sales, the existence of economically recoverable reserves, and the Company’s ability to obtain financing or make other arrangements for exploration, development and future profitable production activities. The ultimate realization of the Company’s investment in exploration properties cannot be determined at this time.

Illegal Blockade of Sierra Mojada Property

On June 1, 2018, the Company’s subsidiaries Minera Metalin and Contratistas entered into an earn-in option agreement (the “South32 Option Agreement”) with South32 International Investment Holdings Pty Ltd (“South32”), a wholly owned subsidiary of South32 Limited (ASX/JSE/LSE: S32), whereby South32 was able to obtain an option to purchase 70% of the shares of Minera Metalin and Contratistas (the “South32 Option”).

On October 11, 2019, the Company and subsidiary Minera Metalin issued a notice of force majeure to South32 pursuant to the South32 Option Agreement. Due to a blockade by Sociedad Cooperativa de Exploración Minera Mineros Norteños, S.C.L. (“Mineros Norteños”), all work was halted on the Sierra Mojada Property. The notice of force majeure was issued because of the blockade’s impact the Company and subsidiary Minera Metalin’s ability to perform their obligations under the South32 Option Agreement. Pursuant to the South32 Option Agreement, any time period provided for in the South32 Option Agreement was to be generally extended by a period equal to the period of delay caused by the event of force majeure.

On August 31, 2022, the South32 Option Agreement was mutually terminated by South32 and the Company. South32 paid $518,000 to the Company as a final payment for the exploration costs incurred by the Company during the blockade and released South32 from all claims as the date of termination.

As of January 26, 2024, the blockade by Mineros Norteños at, on and around the Sierra Mojada Property is ongoing.

ICSID Arbitration

On March 2, 2023, the Company filed the NAFTA Notice of Intent to seek compensation for losses arising out of the illegal blockade of the Sierra Mojada Property by Mineros Norteños and Mexico’s unlawful conduct in relation to the blockade (“NAFTA Notice of Intent”). The Company has been unable to access the project since the illegal blockade commenced in September 2019. Despite numerous demands and requests for action by the Company, Mexican governmental agencies have allowed this unlawful conduct to continue and, as such, failed to protect the Company’s investment, thereby expropriating the Company’s property.

On June 28, 2023, as a result of the Mexican government’s actions with respect to the Company’s investments in Mexico, the Company filed the request for arbitration in the legacy NAFTA claim at the ICSID and commenced international arbitration proceedings against Mexico under the USMCA and NAFTA.

The Company has engaged Boies Schiller Flexner (UK) LLP  as its legal advisers on the legacy NAFTA claim.

2024 Outlook

The focus of the Company for the 2024 calendar year will be to continue with the Arbitration process. If the blockade and the Arbitration proceedings are resolved, any continued exploration of the Sierra Mojada Property ultimately may require the Company to raise additional capital, identify other sources of funding or identify a strategic partner, or other strategic alternatives. The Company is also continuing to seek out other exploration projects for potential development and investment.

Sierra Mojada Project

Location, Access and Infrastructure

The Sierra Mojada Project is located within a mining district known as the Sierra Mojada District. The Sierra Mojada District is located in the west–central part of the state of Coahuila, Mexico, near the Coahuila-Chihuahua state border approximately 200 kilometers south of the Big Bend of the Rio Grande River. The principal mining area extends for approximately five kilometers in an east-west direction along the base of the precipitous, 1,000-meter high Sierra Mojada Range.

The Sierra Mojada Project site is situated to the south of the village of Esmeralda, on the northern side of a major escarpment that forms the northern margin of the Sierra Mojada range. In general, the site is approximately 1,500 meters above sea level. The project is accessible by paved road from the city of Torreon, Coahuila, which lies approximately 250 kilometers to the south. Esmerelda is served by a rail spur of the Coahuila Durango railroad. There is an airstrip east of Esmeralda, although its availability is limited, and another airstrip at the nearby Peñoles plant, which the Company can use occasionally. The Sierra Mojada District has high voltage electric power supplied by the national power company, Comisión Federal de Electricidad, C.F.E., and is supplied water by the municipality of Sierra Mojada. Although power levels are sufficient for current operations and exploration, future development of the project, if any, may require additional power supplies to be sourced.

Sierra Mojada Project facilities in Mexico include offices, accommodation for employees, workshops, warehouse buildings and exploration equipment located at Calle Mina #1, La Esmeralda, Coahuila, Mexico.

The map below shows the location of the Sierra Mojada Project:

The map below shows the concessions of the Sierra Mojada Project:

Property History

Silver and lead were first discovered by a foraging party in 1879, and mining through 1886 consisted of native silver, silver chloride, and lead carbonate ores. After 1886, silver-lead-zinc-copper sulphide ores within limestone and sandstone units were produced. No accurate production history has been found for historical mining during this period.

Approximately 95 years ago, zinc silicate and zinc carbonate minerals (“Zinc Manto Zone”) were discovered underlying the silver-lead mineralized horizon. The Zinc Manto Zone is predominantly zinc dominated, but with subordinate lead-rich manto and is principally situated in the footwall rocks of the Sierra Mojada Fault System. Since discovery and until 1990, zinc, silver, and lead ores were mined from various mines along the strike of the deposit, including from the Sierra Mojada Property. Ores mined from within these areas were hand-sorted, and the concentrate shipped mostly to smelters in the United States.

Activity during the period of 1956 to 1990 consisted of operations by the Mineros Norteños and operations by individual owners and operators of pre-existing mines. The Mineros Norteños operated the San Salvador, Encantada, Fronteriza, Esmeralda, and Parrena mines, and shipped oxide zinc ore to Zinc National’s smelter in Monterrey, while copper and silver ore were shipped to smelters in Mexico and the United States.

It is estimated that over 45 mines have produced ore from underground workings throughout the approximately five kilometers by two-kilometer area that comprises the Sierra Mojada District. It is estimated that since its discovery in 1879, the Sierra Mojada District has produced approximately 10 million tons of silver, zinc, lead and copper ore. The Sierra Mojada District does not have a mill to concentrate ore, and all mining conducted thus far has been limited to selectively mined ore of sufficient grade to direct ship to smelters. The Company believes that mill-grade mineralization that was not mined remains available for extraction. No mining operations are currently active within the area of the Sierra Mojada District, except for a dolomite quarry by Peñoles near Esmeralda.

In the 1990s, Kennecott Copper Corporation (“Kennecott”) had a joint venture agreement with USMX, Inc. (“USMX”) involving its Sierra Mojada concessions. Kennecott terminated the joint venture in approximately 1995. Metalline entered into a Joint Exploration and Development Agreement with USMX in July 1996 involving USMX’s Sierra Mojada concessions. In 1998, Metalline purchased the Sierra Mojada and the USMX concessions, and the joint exploration and development agreement was terminated. Metalline also purchased certain other concessions during this time and conducted exploration for copper and silver mineralization from 1997 through 1999.

Title and Ownership Rights

The Sierra Mojada Project is comprised of 20 concessions consisting of 6,496 hectares (about 16,052 acres). The Company periodically obtains additional concessions in the Sierra Mojada Project area, and whether it will continue to hold these additional concessions will depend on future exploration work and exploration results and its ability to obtain financing. As in prior years, the Company continually assesses its concession ownership, and may terminate its rights to certain concessions holdings.

Each mining concession enables Silver Bull to explore the underlying concession in consideration for the payment of a semi-annual fee to the Mexican government and completion of certain annual assessment work. Annual assessment work in excess of statutory annual requirements can be carried forward and applied to future periods.

Ownership of a concession provides the owner with exclusive exploration and exploitation rights to all minerals located on the concessions, but does not include the surface rights to the real property. Therefore, the Company will need to negotiate any necessary agreements with the appropriate surface landowners if it is determined that a mining operation is feasible for the concessions. The Company owns surface rights to five lots in the Sierra Mojada Property (Sierra Mojada lot #1, #3, #4, #6 and #7) but anticipates that it will be required to obtain additional surface rights if it is determined that a mining operation is feasible.

Geology and Mineralization

The Sierra Mojada concessions contain a mineral system which can be separated into two distinct zones: a silver-rich zone (the “Silver Zone”) and a zinc-rich zone (the “Zinc Zone”). These two zones lie along the Sierra Mojada Fault which trends east–west along the base of the Sierra Mojada range. The majority of the mineralization identified to date is seen as oxide, which has been derived from primary “sulphide” bodies that have been oxidized and remained in situ or remobilized into porous and fractured rock along the Sierra Mojada Fault. The formation of the Silver Zone and the Zinc Zone is a reflection of the mobility of the metals in the ground water conditions at Sierra Mojada.

The geology of the Sierra Mojada District is composed of a Cretaceous limestone and dolomite sequence sitting on top of the Jurassic “San Marcos” red sediments. This sedimentary sequence was subsequently intruded by Tertiary volcanics, which are considered to be responsible for the mineralization seen at Sierra Mojada. Historical mines are dry, and the rocks are competent for the most part. The Company believes that the thickness and attitude of the mineral resources could potentially be amenable to high volume mechanized mining methods and low-cost production.

Sierra Mojada Technical Report Summary (2023)

On January 24, 2023, Archer, Cathro & Associates (1981) Limited and Timothy Barry delivered a technical report summary (the “Sierra Mojada 2023 TRS”) on the silver and zinc mineralization at the Sierra Mojada Project in accordance with subpart 1300 of Regulation S-K. The Sierra Mojada 2023 TRS supersedes the prior mineral resources estimate released by the Company on October 30, 2018. The Sierra Mojada 2023 TRS includes an update on the silver and zinc mineralization which was estimated from 1,336 diamond drill holes, 24 reverse circulation drill holes, 9,027 channel samples and 2,346 underground long holes. Using a net smelter return (“NSR”) economic cut-off, the Sierra Mojada 2023 TRS indicates mineral resources in the optimized pit of 70.4 million tonnes at an average silver grade of 38.6 grams/tonne silver, an average zinc percentage of 3.4%, an average copper percentage of 0.04% and an average lead percentage of 0.3%. The Sierra Mojada Report used a $13.50/tonne NSR cut-off grade and assumed a silver price of $18.00/ounce and a zinc price of $1.20/pound based on a five year average.

Sampling, Analysis, Quality Control and Security

The Company’s activities conform to mining industry standard practices and follow the Best Practices Guidelines of the Canadian Institute of Mining, Metallurgy, and Petroleum (CIM). Sampling is directed and supervised by trained and experienced geologists. Drill core and other samples are processed and logged using industry standard methods. Standard samples, duplicates and blanks are periodically entered into the stream of samples submitted for assays, and campaigns of re-sampling and duplicate analyses and round-robin inter-laboratory validations are conducted periodically. ALS Chemex – Vancouver (“ALS Chemex”) laboratory is the Company’s independent primary laboratory. ALS Chemex is ISO 9001:2000 certified. All analytical results that are used in resource models are exclusively from the independent primary laboratory.

Silver Bull’s consultants perform technical audits of its operations, including a formal quality assurance/quality control (“QA/QC”) program, and recommend improvements as needed. A systematic program of duplicate sampling and assaying of representative samples from previous exploration activities was completed in 2010 under the direction and control of the Company’s consultants. Results of this study acceptably confirm the values in the project database used for resource modeling.

The Company formerly operated a sample preparation and an analytical laboratory at the project that prepared samples for shipment, performed QA/QC analyses to ensure against cross-contamination of samples during preparation and removed most low-value samples from the flow to the primary laboratory. For cost and other reasons, the internal laboratory has been shut down.

Prior Exploration Activities

Exploration efforts have been focused on two primary locations: the Silver Zone and the Zinc Zone. As further described below, various exploration activities have been conducted at the Sierra Mojada Project; however, to date, the Company has not established any reserves, and the project remains in the exploration stage and may never enter the development stage.

Prior to 2008, exploration efforts largely focused on the Zinc Zone with surface and underground drilling. In fiscal year 2009, exploration activities were scaled back and administrative costs were reduced to conserve capital while the Company tried to secure additional sources of capital resources.

After closing the transaction with Dome in April 2010, exploration activities at Sierra Mojada primarily focused on the Silver Zone, which lies largely at surface. By the end of calendar 2018, approximately 101,000 meters of diamond drilling from surface and 10,000 meters of underground drilling had been completed.

The silver contained within the Silver Zone is seen primarily as silver halide minerals. The zinc contained within the Zinc Zone is contained mostly in the mineral hemimorphite and, to a lesser amount, in the mineral smithsonite.

2023 Exploration Activities

Due to the continuing blockade by Mineros Norteños previously mentioned under the “Illegal Blockade” and the “Arbitration” sections of this Annual Report on Form 10-K, during the year ended October 31, 2023, no drilling was conducted as the drilling program remained halted.

Airborne Geophysics

Between September 2018 and November 2018, a 5,297 line kilometer helicopter-borne Versatile Time Domain Electro Magnetic (VTEM) and Magnetic Geophysical Survey was completed over the Sierra Mojada Property. The results of this survey aided in refining the design of the drilling program.

Metallurgical Studies

In May 2015, a selection of high-grade zinc material samples were shipped to a lab in Denver, Colorado for “fine bubble” flotation test work and to a group in Australia to assess their proprietary hydrometallurgy process. Previous test work completed by Silver Bull using mechanical flotation has shown an 87% recovery of zinc from the white zinc zone to produce a rough concentrate of 43% zinc, and a 72.5% recovery of zinc from the red zinc zone to produce a rough concentrate of 30% zinc. The “fine bubble” flotation test work that was performed did not improve recovery, but based on analysis of the results, it was determined that the “fine bubble” flotation test process may be able to be adjusted to improve recovery. Further testing is not planned at this time.

In addition, a metallurgical program was previously conducted to test the recovery of (i) the silver mineralization using the agitation cyanide leach method and (ii) the zinc mineralization using the SART process (sulfidization, acidification, recycling, and thickening). The test work on the Silver Zone focused on cyanide leach recovery of the silver using “Bottle Roll” tests to simulate an agitation leach system and to determine the recovery of (A) low-grade zinc that occurs in the Silver Zone and (B) high-grade zinc from the Zinc Zone that had been blended with mineralization from the Silver-rich Zone to the leach solution. The silver was recovered from the cyanide leach solution using the Merrill Crowe technique, and the zinc was recovered from the leach solution using the SART process. The SART process is a metallurgical process that regenerates and recycles the cyanide used in the leaching process of the silver and zinc and allows for the recovery of zinc that has been leached by the cyanide solution. The results showed an overall average silver recovery of 73.2%, with peak values of 89.0% and an overall average zinc recovery of 44% in the Silver Zone.

Mineral Resources

Under S-K 1300, a mineral resource is defined as “a concentration or occurrence of material of economic interest in or on the Earth’s crust in such form, grade or quality, and quantity that there are reasonable prospects for economic extraction.” A mineral resource is a “reasonable estimate of mineralization, taking into account relevant factors such as cut-off grade, likely mining dimensions, location or continuity, that, with the assumed and justifiable technical and economic conditions, is likely to, in whole or in part, become economically extractable. It is not merely an inventory of all mineralization drilled or sampled.” More information supporting assumptions, methodologies, and procedures can be found in the Technical Report Summary incorporated by reference in Exhibit 96.1 to this Annual Report on Form 10-K.

Sierra Mojada - Summary of Silver and Zinc Mineral Resources at October 31, 2023
Based on $18.00/oz Silver and $1.20/lb Zinc

Competition and Mineral Prices

Mineral Prices

Silver and zinc are commodities, and their prices are volatile. From January 1, 2023 to December 31, 2023 the price of silver ranged from a low of $20.09 per troy ounce to a high of $26.03 per troy ounce, and from January 1, 2023 to December 31, 2023 the price of zinc ranged from a low of $2,404 per tonne to a high of $3,309 per tonne. Silver and zinc prices are affected by many factors beyond the Company’s control, including prevailing interest rates and returns on other asset classes, expectations regarding inflation, speculation, currency values, governmental decisions regarding the disposal of precious metals stockpiles, global and regional demand and production, political and economic conditions and other factors. The competitive nature of the business and the risks faced are discussed further in the “Risk Factors – Risks Related to the Company’s Business” section below.

The following tables set forth, for the periods indicated, high and low silver and zinc prices on the London Metal Exchange in U.S. dollars per troy ounce and per tonne, respectively. On October 31, 2023, the closing price of silver was $23.20 per troy ounce. On October 31, 2023, the closing price of zinc was $2,448 per tonne.

Competition

The mining industry is highly competitive. Silver Bull competes with other mining and exploration companies in the acquisition and exploration of mineral properties. There is competition for a limited number of mineral property acquisition opportunities, some of which is with other companies having substantially greater financial resources, staff and facilities than the Company does. As a result, there may be difficulty acquiring attractive exploration properties, staking claims related to the Company’s properties and exploring properties. The Company’s competitive position depends upon its ability to successfully and economically acquire and explore new and existing mineral properties.

Government Regulation

Mineral exploration activities are subject to various national, state/provincial, and local laws and regulations, which govern prospecting, development, mining, production, exports, taxes, labor standards, occupational health, waste disposal, protection of the environment, mine safety, hazardous substances and other matters. Similarly, if any of the Company’s properties are developed and/or mined, those activities are also subject to significant governmental regulation and oversight. Silver Bull plans to obtain the licenses, permits and other authorizations currently required to conduct its exploration programs. The Company believes that it is in compliance in all material respects with applicable mining, health, safety and environmental statutes and the regulations applicable to the mineral interests held in Mexico.

Environment Regulations

The Company’s activities are subject to various national and local laws and regulations governing protection of the environment. These laws are continually changing and, in general, are becoming more restrictive. Silver Bull intends to conduct business in a way that safeguards public health and the environment and is in compliance with applicable laws and regulations.

Changes to current state or federal laws and regulations in Mexico could, in the future, require additional capital expenditures and increased operating and/or reclamation costs. Although the Company is unable to predict what additional legislation, if any, might be proposed or enacted, additional regulatory requirements could impact the economics of its projects.

During fiscal year 2023, Silver Bull had no material environmental incidents or non-compliance with any applicable environmental regulations.

Employees

Silver Bull has two employees. Minera Metalin, its wholly-owned operating subsidiary in Mexico, currently has one full-time employee.

Corporate Offices

Silver Bull’s corporate office is located at 777 Dunsmuir Street, Suite 1605, Vancouver, British Columbia, Canada V7Y 1K4, telephone number is (604) 687-5800.

Available Information

The Company maintains a website at http://www.silverbullresources.com. The information on the website is not incorporated by reference in this Annual Report on Form 10-K. The Company makes available on or through its website certain reports and amendments to those reports that are filed with or furnished to the SEC in accordance with the Exchange Act. Readers may also obtain this information from the SEC’s website, http://www.sec.gov.

A purchase of the Company’s securities involves a high degree of risk. The Company’s business or operating or financial condition could be harmed due to any of the following risks. Accordingly, investors should carefully consider these risks in making a decision as to whether to purchase, sell or hold securities of the Company. In addition, investors should note that the risks described below are not the only risks facing the Company. Additional risks not presently known to the Company, or risks that do not seem significant today, may impair business operations in the future. Readers should carefully consider the risks described below, as well as the other information contained in this Annual Report on Form 10-K and the documents incorporated by reference herein, before making a decision to invest in securities of the Company.

Risk factors are grouped into the following categories:

• Risks Relating to the Company’s Business;
• Risks Relating to the Mineral Exploration Industry; and
• Risks Relating to the Company’s Common Stock;

RISKS RELATING TO THE COMPANY’S BUSINESS:

There is substantial doubt about whether the Company can continue as a going concern.

To date, the Company has earned no revenues and has incurred accumulated net losses of $138,645,000. In addition, the Company has limited financial resources. As of October 31, 2023, the Company had cash and cash equivalents of $1,009,000 and working capital of $434,000. Continuation as a going concern is dependent upon the continued payment of Arbitration-related costs by Bench Walk 23P, L.P., a Delaware limited partnership (“Bench Walk”), under the Funding Agreement and achieving future financing or strategic transactions. However, there is no assurance that the Funding Agreement will not be terminated or that the Company will have the ability to be successful pursuing a financing or strategic transaction. Accordingly, there is substantial doubt as to whether existing cash resources and working capital are sufficient to enable the Company to continue its operations for the next 12 months as a going concern. Ultimately, in the event that the Funding Agreement is terminated, and the Company cannot obtain additional financial resources, or achieve profitable operations, it may have to liquidate its business interests and investors may lose their investment. The accompanying consolidated financial statements have been prepared assuming that the Company will continue as a going concern. The consolidated financial statements do not include any adjustments that may result from the outcome of this uncertainty. Such adjustments could be material.

The Company may have difficulty meeting its current and future capital requirements.

The Company’s management and the board of directors monitor overall costs and expenses and, if necessary, adjust programs and planned expenditures in an attempt to ensure that the Company has sufficient operating capital. The Company continues to evaluate its costs and planned expenditures for its ongoing Arbitration and exploration efforts at the Sierra Mojada Project. Even with the Funding Agreement in place to cover the costs of the Arbitration process, and additional financial resources from the recently closed private placement, the continued exploration and possible development of the Sierra Mojada Project and the Arbitration claim may require significant amounts of additional capital. If the Company is unable to fund future operations by way of financings, including public or private offerings of equity or debt securities, it will need to reorganize or significantly reduce its operations, which may result in an adverse impact on the Company’s business, financial condition and exploration activities. The Company does not have a credit, off-take or other commercial financing arrangement in place that would finance continued evaluation or development of the Sierra Mojada Project, and the Company believes that securing credit for this project may be difficult. Moreover, equity financing may not be available on attractive terms and, if available, will likely result in significant dilution to existing stockholders.

The Company is a mineral exploration stage company with no history of operations.

While exploration efforts to date have demonstrated positive results, the Company remains an exploration stage enterprise engaged in mineral exploration in Mexico. The Company has a very limited operating history and is subject to all the risks inherent in a new business enterprise. To date, the Company has had no revenues and has relied upon equity financing, South32 funding and sales of investments to fund its operations. The likelihood of success must be considered in light of the problems, expenses, difficulties, complications, and delays frequently encountered in connection with an exploration stage business, and the competitive and regulatory environment in which the Company operates and will operate, such as under-capitalization, personnel limitations, and limited financing sources.

Mineral resource estimates may not be reliable.

There are numerous uncertainties inherent in estimating quantities of mineral resources such as silver, zinc, lead, and copper, including many factors beyond the Company’s control, and no absolute assurance can be given that the recovery of mineral resources will be realized as projected. In general, estimates of mineral resources are based upon a number of factors and assumptions made as of the date on which the estimates were determined, including:

• geological and engineering estimates that have inherent uncertainties;
• the assumed effects of regulation by governmental agencies;
• the judgment of the engineers preparing the estimate;
• estimates of future metals prices and operating costs;
• the quality and quantity of available data;
• the interpretation of that data; and
• the accuracy of various mandated economic assumptions, all of which may vary considerably from actual results.

All estimates are, to some degree, uncertain. For these reasons, estimates of the recoverable mineral resources prepared by different engineers or by the same engineers at different times may vary. As such, there is uncertainty in any mineral resource estimate, and actual deposits encountered and the economic viability of a deposit may differ from the Company’s estimates.

The Company’s business plan is highly speculative, and its success largely depends on the successful exploration of the Sierra Mojada concessions.

The Company’s business plan has been focused on exploring the Sierra Mojada concessions to identify reserves and, if appropriate, to ultimately develop each property. Although the Company has reported mineral resources on the Sierra Mojada Project, it has not established any reserves and remains in the exploration stage. The Company may never enter the development or production stage. Exploration of mineralization and determination of whether the mineralization might be extracted profitably is highly speculative, and it may take a number of years until production is possible, during which time the economic viability of the project may change. Substantial expenditures are required to establish reserves, extract metals from ore and construct mining and processing facilities.

The Sierra Mojada Project is subject to all of the risks inherent in mineral exploration and development. The economic feasibility of any mineral exploration and/or development project is based upon, among other things, estimates of the size and grade of mineral reserves, proximity to infrastructures and other resources (such as water and power), anticipated production rates, capital and operating costs, and metals prices. To advance from an exploration project to a development project, the Company will need to overcome various hurdles, including completing favorable feasibility studies, securing necessary permits, and raising significant additional capital to fund activities. There can be no assurance that the Company will be successful in overcoming these hurdles. Because of the Company’s focus on the Sierra Mojada Project and its proximity to Torreon, Mexico, the success of its operations and profitability may be disproportionately exposed to the impact of adverse conditions unique to the region.

Due to the Company’s history of operating losses, it is uncertain that it will be able to maintain sufficient cash to accomplish its business objectives.

During the fiscal years ended October 31, 2023 and 2022, the Company incurred net losses of $1,251,000 and $3,168,000 respectively. At October 31, 2023, the Company had stockholders’ equity of $5,592,000 and cash and cash equivalents of $1,009,000. If the Blockade is resolved, significant amounts of capital would be required to continue to explore and potentially develop the Sierra Mojada concessions. The Company is not engaged in any revenue producing activities and does not expect to be in the near future. Currently, potential sources of funding consist of the sale of additional equity securities, entering into joint venture agreements or selling a portion of the Company’s interests in its assets. There is no assurance that any additional capital that the Company will require will be obtainable on terms acceptable to it, if at all. Failure to obtain such additional financing could result in delays or indefinite postponement of further exploration of the projects. Additional financing, if available, will likely result in substantial dilution to existing stockholders.

Exploration activities require significant amounts of capital that may not be recovered.

Mineral exploration activities are subject to many risks, including the risk that no commercially productive or extractable resources will be encountered. There can be no assurance that the Company’s activities will ultimately lead to an economically feasible project or that it will recover all or any portion of its investment. Mineral exploration often involves unprofitable efforts, including drilling operations that ultimately do not further exploration efforts. The cost of minerals exploration is often uncertain, and cost overruns are common. Drilling and exploration operations may be curtailed, delayed or canceled as a result of numerous factors, many of which are beyond the Company’s control, including title problems, weather conditions, protests, compliance with governmental requirements, including permitting issues, and shortages or delays in the delivery of equipment and services.

The Company’s financial condition could be adversely affected by changes in currency exchange rates, especially between the U.S. dollar and each of the Mexican peso (“$MXN”) and the Canadian dollar (“$CDN”) given its focus on the Sierra Mojada Project in Mexico and the corporate office in Vancouver, Canada.

The Company’s financial condition is affected in part by currency exchange rates, as portions of its exploration costs in Mexico and general and administration costs in Canada are denominated in the local currency. A weakening U.S. dollar relative to the $MXN and $CDN will have the effect of increasing exploration costs and general and administration costs while a strengthening U.S. dollar will have the effect of reducing exploration costs and general and administration costs. The exchange rates between the $CDN and the U.S. dollar and between the $MXN and U.S. dollar have fluctuated widely in response to international political conditions, general economic conditions and other factors beyond the Company’s control.

The Company shares certain key officers and directors with Arras, which means that those officers do not devote their full time and attention to its affairs, and the overlap may give rise to conflicts of interest.

The Company’s Chief Executive Officer and President, Timothy Barry and Chief Financial Officer, Christopher Richards also serve as President and Chief Executive Officer, and Chief Financial Officer of Arras, respectively. As a result, the Company’s executive officers do not devote their full time and attention to the Company’s affairs. There may be circumstances in which the Company’s executive officers are compelled to spend a significant portion of their time and attention to Arras’ affairs, which may mean that they are unable to devote sufficient time to the Company’s affairs. Furthermore, the Company’s Chairman, Brian Edgar, also serves as Chairman of Arras, and Timothy Barry is also a director of Arras. The overlapping officers and directors may have actual or apparent conflicts of interest with respect to matters involving or affecting each company. For example, conflicts may arise if there are issues or disputes under commercial arrangements that may exist between Arras and the Company. Any failure of the directors or officers of the Company to address these conflicts in an appropriate manner or to allocate opportunities that they become aware of to the Company could have a material adverse effect on the Company’s business, financial condition, results of operations, cash flows or prospects.

The Company needs and relies upon key personnel.

Presently, the Company employs a limited number of full-time employees, utilizes outside consultants, and in large part relies on the efforts of its officers and directors. Success will depend, in part, upon the ability to attract and retain qualified employees. In particular, the Company has only two executive officers: Timothy Barry and Christopher Richards, and the loss of the services of either of these would adversely affect the Company’s business.

The Company is exposed to information systems and cybersecurity risks.

The Company’s information systems (including those of any of its counterparties) may be vulnerable to the increasing threat of continually evolving cybersecurity risks. Unauthorized parties may attempt to gain access to these systems or information through fraud or other means of deception. The Company’s operations depend, in part, on how well it and its counterparties protect networks, equipment, information technology systems and software against damage from threats. The failure of information systems or a component of information systems could, depending on the nature of any such failure, adversely impact the Company’s reputation and results of operations. There can be no assurance that the Company or its counterparties will not incur such losses in the future. The Company’s risk and exposure to these matters cannot be fully mitigated because of, among other things, the evolving nature of these threats. As a result, cybersecurity and the continued development and enhancement of controls, processes and practices designed to protect systems, computers, software, data and networks from attack, damage or unauthorized access remain an area of attention.

RISKS RELATING TO THE MINERAL EXPLORATION INDUSTRY:

There are inherent risks in the mineral exploration industry.

The Company is subject to all of the risks inherent in the minerals exploration industry, including, without limitation, the following:

• competition from a large number of companies, most of which are significantly larger than the Company, in the acquisition, exploration, and development of mining properties;
• the possible inability to raise enough money to pay the fees and taxes and perform the labor necessary to maintain the Company’s concessions in good status;
• exploration for minerals is highly speculative, involves substantial risks and is frequently unproductive, even when conducted on properties known to contain significant quantities of mineralization, and the Company’s exploration projects may not result in the discovery of commercially mineable deposits of ore;
• the probability of an individual prospect ever having reserves that meet the requirements for reporting under S-K 1300 is remote, and any funds spent on exploration may be lost;
• the Company’s operations are subject to a variety of existing laws and regulations relating to exploration and development, permitting procedures, safety precautions, property reclamation, employee health and safety, air quality standards, pollution and other environmental protection controls, and it may not be able to comply with these regulations and controls; and
• a large number of factors beyond the Company’s control, including fluctuations in metal prices, inflation, and other economic conditions, will affect the economic feasibility of mining.

Metals prices are subject to extreme fluctuation.

The Company’s activities are influenced by the prices of commodities, including silver, zinc, lead, copper and other metals. These prices fluctuate widely and are affected by numerous factors beyond the Company’s control, including interest rates, expectations for inflation, speculation, currency values (in particular, the strength of the U.S. dollar), global and regional demand, political and economic conditions and production costs in major metal-producing regions of the world.

The Company’s ability to establish reserves through its exploration activities, its future profitability and long-term viability depend, in large part, on the market prices of silver, zinc, lead, copper and other metals. The market prices for these metals are volatile and are affected by numerous factors beyond the Company’s control, including:

• global or regional consumption patterns;
• supply of, and demand for, silver, zinc, lead, copper and other metals;
• speculative activities and producer hedging activities;
• expectations for inflation;
• political and economic conditions; and
• supply of, and demand for, consumables required for production.

Future weakness in the global economy could increase volatility in metals prices or depress metals prices, which could in turn reduce the value of the Company’s properties, make it more difficult to raise additional capital, and make it uneconomical for it to continue its exploration activities.

There are inherent risks with foreign operations.

The Company’s business activities are primarily conducted in Mexico, and as such, its activities are exposed to various levels of foreign political, economic and other risks and uncertainties. These risks and uncertainties include, but are not limited to, terrorism, hostage taking, military repression, extreme fluctuations in currency exchange rates, high rates of inflation, labor unrest, war or civil unrest, expropriation and nationalization, renegotiation or nullification of existing concessions, licenses, permits, approvals and contracts, illegal mining, changes in taxation policies, restrictions on foreign exchange and repatriation, changing political conditions (including, potential instability if the United States or Mexico withdraws from the United States-Mexico-Canada Agreement), currency controls and governmental regulations that favor or require the rewarding of contracts to local contractors or require foreign contractors to employ citizens of, or purchase supplies from, a particular jurisdiction.

Changes, if any, in mining or investment policies or shifts in political attitude in Mexico may adversely affect the Company’s exploration and possible future development activities. The Company may also be affected to varying degrees by government regulations with respect to, but not limited to, foreign investment, maintenance of claims, environmental legislation, land use, land claims of local people, water use and mine safety. Failure to comply strictly with applicable laws, regulations and local practices relating to mineral right applications and tenure could result in loss, reduction or expropriation of entitlements, or the imposition of additional local or foreign parties as joint venture partners with carried or other interests.

The occurrence of these various factors and uncertainties cannot be accurately predicted and could have an adverse effect on the Company’s operations. In addition, legislation in the United States, Canada or Mexico regulating foreign trade, investment and taxation could have a material adverse effect on the Company’s financial condition.

The Sierra Mojada Project is located in Mexico and is subject to varying levels of political, economic, legal and other risks.

The Sierra Mojada Project is in Mexico. Mexico has been subject to political instability, changes and uncertainties that have resulted in changes to existing governmental regulations affecting mineral exploration and mining activities. Mexico’s status as a developing country may make it more difficult for the Company to obtain any required financing for the Sierra Mojada Project or other projects in Mexico in the future. The Sierra Mojada Project is also subject to a variety of governmental regulations governing health and worker safety, employment standards, waste disposal, protection of historic and archaeological sites, mine development, protection of endangered and protected species and other matters. Mexican regulators have broad authority to shut down and/or levy fines against facilities that do not comply with regulations or standards.

The Company’s exploration activities in Mexico have been adversely affected by changing government regulations relating to the mining industry and shifts in political conditions that have impacted the Company’s ability to continue to advance the Sierra Mojada Project. Additional changes, if any, in mining or investment policies or shifts in political attitude may adversely affect the Company’s financial condition. Expansion of the Company’s activities will be subject to the need to obtain sufficient access to adequate supplies of water and assure the availability of sufficient power and surface rights that could be affected by government policy and competing operations in the area.

The Company also has litigation risk with respect to its operations. See Part I, Item 3 – Legal Proceedings of this Annual Report on Form 10-K for an explanation of material legal proceedings to which Silver Bull or its subsidiaries have been a party.

The occurrence of these various factors and uncertainties cannot be accurately predicted and could have an adverse effect on the Company’s financial condition. Future changes in applicable laws and regulations or changes in their enforcement or regulatory interpretation could negatively impact current or planned exploration activities with the Sierra Mojada Project or in respect to any other projects in which the Company becomes involved in Mexico. Any failure to comply with applicable laws and regulations, even if inadvertent, could result in the interruption of exploration operations or material fines, penalties or other liabilities.

Title to the Company’s properties may be challenged or defective.

The Company’s future operations, including any activities at the Sierra Mojada Project and other exploration activities, will require additional permits from various governmental authorities. The Company’s operations are and will continue to be governed by laws and regulations governing prospecting, mineral exploration, exports, taxes, labor standards, occupational health, waste disposal, toxic substances, land use, environmental protection, mine safety, mining royalties and other matters. There can be no assurance that the Company will be able to acquire all required licenses, permits or property rights on reasonable terms or in a timely manner, or at all, that such terms will not be adversely changed, that required extensions will be granted, or that the issuance of such licenses, permits or property rights will not be challenged by third parties.

The Company attempts to confirm the validity of its rights of title to, or contract rights with respect to, each mineral property in which it has a material interest. However, the Company cannot guarantee that title to its properties will not be challenged. The Sierra Mojada Property may be subject to prior unregistered agreements, interests or native land claims, and title may be affected by undetected defects. There may be valid challenges to the title of any of the claims comprising the Sierra Mojada Property that, if successful, could impair possible development and/or operations with respect to such properties in the future. Challenges to permits or property rights (whether successful or unsuccessful), changes to the terms of permits or property rights, or a failure to comply with the terms of any permits or property rights that have been obtained could have a material adverse effect on business by delaying or preventing or making continued operations economically unfeasible.

A title defect could result in Silver Bull losing all or a portion of its right, title, and interest to and in the properties to which the title defect relates. Title insurance generally is not available, and the Company’s ability to ensure that it has obtained secure title to individual mineral properties or mining concessions may be severely constrained. In addition, the Company may be unable to operate its properties as permitted or to enforce its rights with respect to its properties. The Company annually monitors the official mining records in Mexico City to determine if there are annotations indicating the existence of a legal challenge against the validity of any of its concessions. As of January 2024, and to the best of the Company’s knowledge, there are no such annotations, nor is the Company aware of any challenges from the government or from third parties, except for the matters described in Part I, Item 3 – Legal Proceedings.

In addition, in connection with the purchase of certain mining concessions, Silver Bull agreed to pay a net royalty interest on revenue from future mineral sales on certain concessions at the Sierra Mojada Project, including concessions on which a significant portion of its mineral resources are located. The aggregate amount payable under this royalty is capped at $6.875 million (the “Royalty”), an amount that will only be reached if there is significant future production from the concessions. As noted in Part I, Item 3 (Legal Proceedings), this Royalty is currently the subject of a dispute with a local cooperative. In addition, records from prior management indicate that additional royalty interests may have been created, although the continued applicability and scope of these interests are uncertain. The existence of these royalty interests may have a material effect on the economic feasibility of potential future development of the Sierra Mojada Project.

The Company is subject to complex environmental and other regulatory risks, which could expose it to significant liability and delay and potentially the suspension or termination of exploration efforts.

The Company’s mineral exploration activities are subject to federal, state and local environmental regulations in the jurisdictions where its mineral properties are located. These regulations mandate, among other things, the maintenance of air and water quality standards and land reclamation. They also set forth limitations on the generation, transportation, storage and disposal of solid and hazardous waste. No assurance can be given that environmental standards imposed by these governments will not be changed, thereby possibly materially adversely affecting the Company’s proposed activities. Compliance with these environmental requirements may also necessitate significant capital outlays or may materially affect the Company’s earning power.

Environmental legislation is evolving in a manner that will require stricter standards and enforcement, increased fines and penalties for non-compliance, more stringent environmental assessments of proposed projects, and a heightened degree of responsibility for companies and their officers, directors and employees. As a result of recent changes in environmental laws in Mexico, for example, more legal actions supported or sponsored by non-governmental groups interested in halting projects may be filed against companies operating in all industrial sectors, including the mining sector. Mexican projects are also subject to the environmental agreements entered into by Mexico, the United States and Canada in connection with the United States-Mexico-Canada Agreement.

Future changes in environmental regulations in the jurisdictions where the Company’s projects are located may adversely affect its exploration activities, make them prohibitively expensive, or prohibit them altogether. Environmental hazards may exist on the properties in which the Company currently holds interests, such as the Sierra Mojada Project, or may hold interests in the future, that are unknown to it at present and that have been caused by it or previous owners or operators, or that may have occurred naturally. The Company may be liable for remediating any damage that it may have caused. The liability could include costs for removing or remediating the release and damage to natural resources, including ground water, as well as the payment of fines and penalties.

The Company’s industry is highly competitive, attractive mineral properties and property concessions are scarce, and it may not be able to obtain quality properties or concessions.

The Company competes with other mining and exploration companies in the acquisition of mineral properties and property concessions. There is competition for a limited number of attractive mineral property acquisition opportunities, some of which is with other companies having substantially greater financial resources, staff and facilities than the Company. As a result, the Company may have difficulty acquiring quality mineral properties or property concessions.

The Company may face a shortage of water.

Water is essential in all phases of the exploration and development of mineral properties. It is used in such processes as exploration, drilling, leaching, placer mining, dredging, testing, and hydraulic mining. Both the lack of available water and the cost of acquisition may make an otherwise viable project economically impossible to complete. In November 2013, Silver Bull was granted the right to exploit up to 3.5 million cubic meters of water per year from six different well sites by the water regulatory body in Mexico, La Comisión Nacional del Agua, but it has yet to be determined if the six well sites can produce this much water over a sustained period of time.

The Company’s non-operating properties are subject to various hazards.

The Company is subject to risks and hazards, including environmental hazards, possible encounters with unusual or unexpected geological formations, cave-ins, flooding and earthquakes, and periodic interruptions due to inclement or hazardous weather conditions. These occurrences could result in damage to, or the destruction of, mineral properties or future production facilities, personal injury or death, environmental damage, delays in exploration activities, asset write-downs, monetary losses and possible legal liability. The Company may not be insured against all losses or liabilities, either because such insurance is unavailable or because it has elected not to purchase such insurance due to high premium costs or other reasons. Although the Company maintains insurance in an amount that it considers to be adequate, liabilities might exceed policy limits, in which event the Company could incur significant costs that could adversely affect its activities. The realization of any significant liabilities in connection with the Company’s activities as described above could negatively affect its activities and the price of its common stock.

RISKS RELATING TO THE COMPANY’S COMMON STOCK:

Further equity financings may lead to the dilution of the Company’s common stock.

In order to finance future operations, the Company may raise funds through the issuance of common stock or the issuance of debt instruments or other securities convertible into common stock. The Company cannot predict the size of future issuances of common stock or the size and terms of future issuances of debt instruments or other securities convertible into common stock or the effect, if any, that future issuances and sales of the Company’s securities will have on the market price of its common stock. Any transaction involving the issuance of previously authorized but unissued shares, or securities convertible into common stock, would result in dilution, possibly substantial, to present and prospective security holders. Demand for equity securities in the mining industry has been weak; therefore, equity financing may not be available on attractive terms and, if available, will likely result in significant dilution to existing shareholders.

No dividends are anticipated.

At the present time, the Company does not anticipate paying dividends, cash or otherwise, on its common stock in the foreseeable future. Future dividends will depend on the Company’s earnings, if any, its financial requirements and other factors. There can be no assurance that the Company will pay dividends.

The Company’s stock price can be very volatile.

The common stock of the Company is listed on the TSX and trades on the OTCQB. The trading price of the Company’s common stock has been, and could continue to be, subject to wide fluctuations in response to announcements of its business developments, results and progress of its exploration activities at the Sierra Mojada Project, progress reports on its exploration activities, and other events or factors. In addition, stock markets have experienced significant price volatility in recent months and years. This volatility has had a substantial effect on the share prices of companies, at times for reasons unrelated to their operating performance. These fluctuations could be in response to:

• volatility in metal prices;
• political developments in the foreign countries in which its properties are located; and
• news reports relating to trends in the industry or general economic conditions.

These broad market and industry fluctuations may adversely affect the price of the Company’s common stock, regardless of its operating performance.

The Company cannot make any predictions or projections as to what the prevailing market price for its common stock will be at any time, including as to whether its common stock will achieve or remain at levels at or near its offering price, or as to what effect the sale of shares or the availability of common stock for sale at any time will have on the prevailing market price.

None.

Not applicable.

Mineros Norteños Case

On May 20, 2014, Mineros Norteños filed an action in the Local First Civil Court in the District of Morelos, State of Chihuahua, Mexico, against the Company’s subsidiary, Minera Metalin, claiming that Minera Metalin breached an agreement regarding the development of the Sierra Mojada Property. Mineros Norteños sought payment of the Royalty, including interest at a rate of 6% per annum since August 30, 2004, even though no revenue has been produced from the applicable mining concessions. It also sought payment of wages to the cooperative’s members since August 30, 2004, even though none of the individuals were hired or performed work for Minera Metalin under this agreement and Minera Metalin did not commit to hiring them. On January 19, 2015, the case was moved to the Third District Court (of federal jurisdiction). On October 4, 2017, the court ruled that Mineros Norteños was time barred from bringing the case. On October 19, 2017, Mineros Norteños appealed this ruling. On July 31, 2019, the Federal Appeals Court upheld the original ruling. This ruling was subsequently challenged by Mineros Norteños and on January 24, 2020, the Federal Circuit Court ruled that the Federal Appeals Court must consider additional factors in its ruling. In March 2020, the Federal Appeals Court upheld the original ruling after considering these additional factors. In August 2020, Mineros Norteños appealed this ruling, which appeal the Company timely responded and objected to on October 5, 2020. On March 26, 2021, the Federal Circuit Court issued a final and conclusive resolution, affirming the Federal Appeals Court decision. Despite the judgments in favour of the Company, Mineros Norteños has continued to block access to the facilities at Sierra Mojada since September 2019.  The Company has filed criminal complaints with the State of Coahuila, federal and state authorities have been contacted to intervene and terminate the blockade, and the Company has attempted to negotiate with Mineros Norteños, without resolution to date. The Company has not accrued any amounts in its consolidated financial statements with respect to this claim.

Valdez Case

On February 15, 2016, Messrs. Jaime Valdez Farias and Maria Asuncion Perez Alonso (collectively, “Valdez”) filed an action before the Local First Civil Court of Torreon, State of Coahuila, Mexico, against the Company’s subsidiary, Minera Metalin, claiming that Minera Metalin had breached an agreement regarding the development of the Sierra Mojada Property. Valdez sought payment in the amount of $5.9 million for the alleged breach of the agreement. On April 28, 2016, Minera Metalin filed its response to the complaint, asserting various defenses, including that Minera Metalin terminated the agreement before the payment obligations arose and that certain conditions precedent to such payment obligations were never satisfied by Valdez. The Company and its Mexican legal counsel asserted all applicable defenses. In May 2017, a final judgment was entered finding for the Company, the defendant, acquitting it of all of the plaintiff’s claims and demands. However, due to a technicality in an early procedural act, Valdez was allowed to, and did, challenge the judgment before a local Appeals Court. On October 1, 2020, the Appeals Court entered a resolution overturning the previous judgment and entering a resolution in favor of Valdez in the amount of $5 million, plus court costs. In November 2020, the judgment of the Appeals Court was timely challenged by the Company by means of an “Amparo” lawsuit (Constitutional protection) before a Federal Circuit Court. In June 2021, the Federal Circuit Court ruled in favor of the plaintiff. In consultation with the Company’s Mexican legal counsel, the Company believes these judgments are contrary to applicable law. No efforts have been made by the plaintiff to enforce the Appeals Court resolution, and in the event such efforts are undertaken, the Company intends to assert a variety of further defenses. The Company believes the likelihood of the plaintiff succeeding in collecting any amount on this claim is remote, as such it has not accrued any amounts in the consolidated financial statements with respect to this claim.

ICSID Arbitration

On March 2, 2023, the Company filed a NAFTA Notice of Intent to seek compensation for losses arising out of the illegal blockade of the Sierra Mojada Property by Mineros Norteños and Mexico’s unlawful conduct in respect of the blockade.

As is required by Article 1118 of NAFTA, the Company sought to settle this dispute with Mexico through consultations. On May 30, 2023, the Company attended a meeting with Mexican government officials in Mexico City, but, notwithstanding the Company’s good faith efforts to resolve the dispute amicably, no settlement was reached. Accordingly, the Company filed a request for arbitration with the ICSID on June 28, 2023. On July 20, 2023, ICSID registered the request.

The Arbitration was initiated under the Convention on the Settlement of Investment Disputes between States and Nationals of Other States process, which falls under the auspices of ICSID.

As Arbitration proceedings are in early stages, the Company cannot determine the likelihood of succeeding in collecting any amount, as such has not accrued any amounts in the consolidated financial statements with respect to this claim.

See Note 16 – Commitments and Contingencies to the Company’s consolidated financial statements.

Not applicable.

PART II

Market Information

From May 2, 2011 to June 28, 2015, Silver Bull’s common stock traded on the NYSE MKT (the predecessor stock exchange to the NYSE American) under the symbol “SVBL.” On June 5, 2015, the Company announced its decision to voluntarily delist its shares of common stock from the NYSE MKT due to costs associated with the continued listing and NYSE MKT exchange rules regarding maintenance of a minimum share price. On June 29, 2015, Silver Bull shares began trading on the OTCQB marketplace operated by OTC Markets Group. Since August 26, 2010, the Company’s common stock has been trading on the TSX under the symbol “SVB.”

The sales prices on the OTCQB reflect inter-dealer prices, without retail mark-up, mark-down or commission and may not necessarily represent actual transactions.

Holders

As of January 26, 2024, there were 262 holders of record of the Company’s common stock. This does not include persons or entities that hold common stock in brokerage accounts or otherwise in “street name.”

Dividends

The Company has not declared or paid any cash dividends on its common stock during the last two fiscal years. The Company has no plans to pay any cash dividends in the foreseeable future.

Securities Authorized for Issuance Under Equity Compensation Plans

As of October 31, 2023, the Company had one formal equity compensation plan under which equity securities were authorized for issuance to its officers, directors, employees and consultants: the 2019 Stock Option and Stock Bonus Plan (the “2019 Plan”). The 2019 Plan was adopted by the board of directors in February 2019 and approved by the shareholders in April 2019. The 2019 Plan was amended by the board of directors in February 2022, and the amendment was approved by shareholders in April 2022 (the “Amended 2019 Plan”). Under the Amended 2019 Plan, the lesser of (i) 15,000,000 shares or (ii) 10% of the total shares outstanding will be reserved to be issued upon the exercise of options or the grant of stock bonuses. As of October 31, 2023, there were 2,436,565 shares reserved for issuance under the Amended 2019 Plan.

The following table gives information about the Company’s common stock that may be issued upon the exercise of options, warrants and rights under its compensation plans as of October 31, 2023.

Recent Sales of Unregistered Securities and Purchases of Equity Securities by the Issuer and Affiliated Purchasers

Recent Sales of Unregistered Securities

On October 30, 2023, the Company completed a private placement of an aggregate of 11,685,000 units at a purchase price of $CDN 0.11 per unit (the “$CDN 0.11 Unit”) for aggregate gross proceeds of approximately $929,786 ($CDN 1,285,350). Each $CDN 0.11 Unit consists of one share of common stock and one half of one transferable common stock purchase warrant (each whole warrant, a “$CDN 0.13 Warrant”).  Each $CDN 0.13 Warrant entitles the holder thereof to acquire one share of common stock at a price of $CDN 0.13 until October 30, 2028. The Company paid finder’s fees totaling $14,210 to agents with respect to certain purchasers who were introduced by these agents. The Company relied on the exemption from registration under Section 4(a)(2) of the Securities Act or Rule 506 of Regulation D, or Regulation S, for purposes of the $CDN 0.11 Unit private placement. 

Purchases of Equity Securities by the Company and Affiliated Purchasers

No purchases of equity securities were made by or on behalf of Silver Bull or any “affiliated purchaser” within the meaning of Rule 10b-18 under the Exchange Act during the period covered by this report.

Business Overview

Silver Bull, incorporated in Nevada, is an exploration stage company, engaged in the business of mineral exploration. The Company’s primary objective is to define sufficient mineral reserves on the Sierra Mojada Property to justify the development of a mechanized mining operation. Operations in Mexico are conducted through the Company’s wholly-owned Mexican subsidiaries, Minera Metalin and Minas. However, as noted above, Silver Bull has not established any reserves at the Sierra Mojada Property, is in the exploration stage and may never enter the development or production stage.

Silver Bull’s corporate office is located at 777 Dunsmuir Street, Suite 1605, Vancouver, British Columbia, Canada V7Y 1K4, telephone number is (604) 687-5800.

Recent Developments

2023 Private Placement

On October 30, 2023, the Company completed a private placement financing under the Canadian Listed Issuer Financing Exemption, raising gross proceeds of $929,786, by issuing 11,685,000 units consisting of one share of common stock and one half of one common stock purchase warrant as described below in the “Material Changes in Financial Condition; Liquidity and Capital Resources” section.

Litigation Funding Agreement

On September 5, 2023, the Company entered into a litigation funding agreement (“Funding Agreement” or the “LFA”) with Bench Walk. Under the terms of the Funding Agreement, Bench Walk has agreed to fund the Company with up to $9.5 million to cover the Company’s legal, tribunal and external expert costs and defined corporate operating expenses associated with the Arbitration proceedings as a purchase of a contingent entitlement to damages.

ICSID Arbitration

On June 28, 2023, the Company commenced international arbitration proceedings against Mexico under the USMCA and NAFTA, arising from Mexico’s unlawful expropriation and other unlawful treatment of Silver Bull and its investments resulting from the illegal blockade of the Company’s Sierra Mojada project.

Management and Board Changes

On April 25, 2023, Mr. Darren Klinck ceased serving as the President of the Company. Mr. Tim Barry (the Company’s Chief Executive Officer) was appointed as the Company’s President, replacing Mr. Klinck.

On March 2, 2023, Mr. William Matlack was appointed to the board of directors of the Company as an independent director. Mr. Matlack is a veteran geologist with over a 20-year career in the mining industry, working primarily with Santa Fe Pacific Gold Corp. (now Newmont Mining) and Gold Fields. Mr. Matlack was involved in the exploration and development of several world-class gold discoveries in Nevada and California. Later, he was an equity research analyst in metals & mining with Citigroup and BMO Capital Markets, and an investment banker in metals & mining with Scarsdale Equities. Mr. Matlack was interim CEO of Klondex Mines Limited (“Klondex”) in 2012 and was a director of Klondex from 2012 to 2018 during its transformation from an explorer to gold producer in Nevada. Mr. Matlack has served as a director of Timberline Resources Corp. since October 2019.

Results of Operations

Fiscal Year Ended October 31, 2023 Compared to Fiscal Year Ended October 31, 2022

For the fiscal year ended October 31, 2023, the Company reported a consolidated net loss of $1,251,000 or approximately $0.04 per share, compared to a consolidated net loss of $3,168,000 or approximately $0.09 per share during the fiscal year ended October 31, 2022. The $1,917,000 decrease in the consolidated net loss was primarily due to a $2,060,000 decrease in exploration and property holding costs (which was mainly the result of the $2,058,000 goodwill impairment during the fiscal year ended October 31, 2022) and a $110,000 decrease in administrative expenses, which was partially offset by a $255,000 decrease in other income in the 2023 fiscal year compared to the 2022 fiscal year as described below.

Exploration and Property Holding Costs

Exploration and property holding costs decreased by $2,060,000 to $332,000 in the 2023 fiscal year from $2,392,000 in the 2022 fiscal year. This decrease was mainly the result of a $2,058,000 goodwill impairment during the fiscal year ended October 31, 2022 and a $9,000 decrease in exploration and holding costs, which was offset by a $16,000 concession impairment in the 2023 fiscal year.

General and Administrative Costs

General and administrative expenses decreased by $110,000 to $935,000 in the 2023 fiscal year from $1,045,000 in the 2022 fiscal year as described below.

Stock-based compensation was a factor in the fluctuations in general and administrative expenses. Overall stock-based compensation included in general and administrative expense decreased to $73,000 in the 2023 fiscal year from $296,000 in the 2022 fiscal year. This was mainly due to stock options granted to the Company’s employees, directors and advisors in the 2022 fiscal year.

Personnel costs decreased by $161,000 to $292,000 in the 2023 fiscal year from $453,000 in the 2022 fiscal year. This decrease was mainly due to a $177,000 decrease in stock-based compensation expenses in the 2023 fiscal year to $47,000 from $224,000 in the 2022 fiscal year as a result of stock options vesting in the 2023 fiscal year having a lower fair value than stock options vesting in the 2022 fiscal year, which were partially offset by a $18,000 increase in employees’ salaries and bonuses.

Office and administrative expenses decreased by $16,000 to $219,000 in the 2023 fiscal year from $235,000 in the 2022 fiscal year. This decrease was primarily due to decreased insurance, which were partially offset by a $13,000 increase in travel costs.

Professional services increased by $291,000 to $474,000 in the 2023 fiscal year from $183,000 in the 2022 fiscal year. This increase was mainly due to arbitration-related costs incurred in relation to the Arbitration (as described in the “Recent Developments” section).

Directors’ fees decreased by $45,000 to $113,000 in the 2023 fiscal year as compared to $158,000 for the 2022 fiscal year. This decrease was primarily due to a $46,000 decrease the stock-based compensation expense to $26,000 in the 2023 fiscal year from $72,000 in the 2022 fiscal year as a result of stock options vesting in the 2023 fiscal year having a lower fair value than stock options vesting in the 2022 fiscal year.

The Company recorded a $45,000 provision for uncollectible VAT for the 2023 fiscal year as compared to a $14,000 provision for uncollectible VAT in the 2022 fiscal year. The allowance for uncollectible taxes in Mexico was estimated by management based upon a number of factors, including the length of time the returns have been outstanding, responses received from tax authorities, general economic conditions in Mexico and estimated net recovery after commissions.

In the current year, the Company recorded a contra expense of $209,000 which is comprised of funds from the litigation Funding Agreement. Bench Walk is funding the Company’s legal, tribunal and external expert costs and defined corporate operating expenses. This is a nonrecourse agreement, and the Company has no obligation to repay any funds received under the agreement. In the event of a favorable outcome, Bench Walk would recover disbursed funding as part of their investment return.

As part of that funding arrangement, Bench Walk agreed to reimburse Silver Bull $237,000 which was comprised of $97,000 for reimbursement of previously incurred expenses and $140,000 for working capital including incurred general and administrative costs. As the Funding Agreement was entered into in September 2023, there is no comparable amount in the prior year.

During the fiscal year ended October 31, 2023, the arbitration lawyers incurred $473,774 in legal costs, all of which was paid by Bench Walk directly.

Other Income

The Company recorded other income of $18,000 in the 2023 fiscal year as compared to other income of $273,000 in the 2022 fiscal year. The significant factor contributing to other income in the 2023 fiscal year was a $32,000 interest income and a $9,000 foreign currency transaction income, which was offset by $20,000 other costs related to the certain years’ VAT and corporate taxes disputes with Mexican tax authorities and a $3,000 expense related to the issuance of warrants. The significant factor contributing to other income in the 2022 fiscal year was a gain of $301,000 from selling Arras common shares and interest income of $6,000, which was offset by a $34,000 foreign currency transaction loss.

Material Changes in Financial Condition; Liquidity and Capital Resources

2023 Private Placement

On October 30, 2023, the Company completed a private placement of 11,685,000 units at a purchase price of $CDN 0.11 per unit (the “$CDN 0.11 Unit”) for aggregate gross proceeds of $929,786 ($CDN 1,285,350). Each $CDN 0.11 Unit consists of one share of common stock of the Company and one half of one transferable common stock purchase warrant (each whole warrant, a “$CDN 0.13 Warrant”).  Each $CDN 0.13 Warrant entitles the holder thereof to acquire one share of common stock at a price of $CDN 0.13 for a period of 60 months from the closing of the private placement. The Company paid finders’ fees totaling $14,210 to agents with respect to certain purchasers who were introduced by these agents. In addition, the Company incurred other offering costs of approximately $29,145.

Litigation Funding Agreement

As noted above, pursuant to the Funding Agreement, Bench Walk is paying up to an aggregate of $9.5 million to fund legal costs and other expenses incurred by the Company in connection with the Claim, including an amount for reasonably incurred day-to-day operating expenses of the Company. During the 2023 fiscal year, the Company received initial funding of $97,000 as reimbursement of corporate operating costs incurred. In January 2024, the Company received an additional reimbursement of $200,000 from Bench Walk.

The Company agreed that the Bench Walk shall be entitled to receive a share of any proceeds arising from the Claim (the “Claim Proceeds”) of up to 3.5x Bench Walk’s capital outlay (or, if greater, a return of 1.0x Bench Walk’s capital outlay plus 30% of the Claim Proceeds). The actual return to Bench Walk may be lower than the foregoing amounts depending on how quickly the Claim is resolved.

Cash Flows

During the 2023 fiscal year, cash and cash equivalents were primarily utilized to fund general and administrative expenses and exploration activities at the Sierra Mojada Property. In addition, the Company received net proceeds of $916,000  from the private placement and $97,000 from Bench Walk . As a result of the net cash proceeds received from the private placement and the arbitration funding from Bench Walk, which was partially offset by exploration activities and general and administrative expenses, cash and cash on hand increased from $887,000 at October 31, 2022 to $1,009,000 at October 31, 2023.

Cash flows used in operations for the 2023 fiscal year were $794,000 as compared to $1,255,000 for the 2022 fiscal year. The decrease was mainly due to the timing of certain payments.

Cash flows provided by investing activities for the 2023 fiscal year was $nil. Cash flows provided by investing activities for the 2022 fiscal year were $1,434,000 from the sale of Arras common shares.

Cash flows provided by financing activities for the 2023 fiscal year were $916,000 as compared to $518,000 in the 2022 fiscal year. The cash flows provided by financing activities in the 2023 fiscal year was due to the private placement the Company completed and the cash flows provided by financing activities in the 2022 fiscal year were due to funding from South32.

Capital Resources

As of October 31, 2023, the Company had cash and cash equivalents of $1,009,000 as compared to cash and cash equivalents of $887,000 as of October 31, 2022. The increase in liquidity was primarily the result of the proceeds from the private placement, which were partially offset by exploration activities and property holding costs at the Sierra Mojada Property and general and administrative expenses.

Since the Company’s inception in November 1993, it has not generated revenue and has incurred an accumulated deficit of $138,645,000. Accordingly, the Company has not generated cash flows from operations, and since inception has relied primarily upon proceeds from private placements and registered direct offerings of its equity securities, warrant exercises, the sale of investments and funding from Bench Walk and South32 as the primary sources of financing to fund operations. Based on the limited cash and cash equivalents, and history of losses, there is substantial doubt as to whether the Company’s existing cash resources are sufficient to enable it to continue operations for the next 12 months as a going concern. Management plans to pursue possible financing and strategic options, including, but not limited to, obtaining additional equity financing and the exercise of warrants by warrantholders. However, there is no assurance that the Company will be successful in pursuing these plans.

Any future additional financing in the near term will likely be in the form of the issuance of equity securities, which will result in dilution to Silver Bull’s existing shareholders. Moreover, the Company may incur significant fees and expenses in the pursuit of a financing or other strategic transaction, which will increase the rate at which its cash and cash equivalents are depleted.

Capital Requirements and Liquidity; Need for Additional Funding

The Company’s management and board of directors monitor overall costs, expenses, and financial resources and, if necessary, will adjust planned operational expenditures in an attempt to ensure that the Company has sufficient operating capital. The Company continues to evaluate its costs and planned expenditures, including its Sierra Mojada Property as discussed below.

If the blockade is resolved, and exploration of the Sierra Mojada project is restarted, the Company will require significant amounts of additional capital. As of December 31, 2023, the Company had approximately $0.3 million in cash and cash equivalents. The continued exploration of the Sierra Mojada Property ultimately would require the Company to raise additional capital, identify other sources of funding, identify a strategic partner or other strategic alternatives.

The Company will continue to evaluate its ability to obtain additional financial resources, and will attempt to reduce or limit expenditures on the Sierra Mojada Property as well as general and administrative costs if it is determined that additional financial resources are unavailable or available on terms that it determines are unacceptable. However, it may not be possible to reduce costs, and even if the Company is successful in reducing costs, it still may not be able to continue operations for the next 12 months as a going concern. Debt or equity financing may not be available on acceptable terms, if at all. Equity financing, if available, may result in substantial dilution to existing stockholders. If the Company is unable to fund future operations by way of financings, including public or private offerings of equity or debt securities, its business, financial condition and results of operations will be adversely impacted.

Off-Balance Sheet Arrangements

There are no significant off-balance sheet arrangements that have or are reasonably likely to have a current or future effect on the Company’s financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources that are material to its shareholders.

Recent Accounting Pronouncements Adopted in the Fiscal Year Ended October 31, 2023

In November 2021, Silver Bull adopted the Financial Accounting Standards Board’s (“FASB”) Accounting Standards Updated (“ASU”) 2021-10, “Government Assistance (Topic 832)” which provides guidance for required annual disclosures about transactions with a government that are accounted for by applying a grant or contribution accounting model by analogy. The Company adopted this standard as of November 1, 2022. The adoption did not have a significant impact on the Company’s financial position, results of operations or cash flows and disclosures.

Recent Accounting Pronouncements Not Yet Adopted

In November 2023, the FASB issued ASU 2023-07, Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures. The ASU expands public entities’ segment disclosures by requiring disclosure of significant segment expenses that are regularly provided to the chief operating decision maker and included within each reported measure of segment profit or loss, an amount and description of its composition for other segment items, and interim disclosures of a reportable segment’s profit or loss and assets. All disclosure requirements under ASU 2023-07 are also required for public entities with a single reportable segment. The ASU is effective for the Company’s Annual Report on Form 10-K for the fiscal year ended October 31, 2024, with early adoption permitted. The Company is currently evaluating the impact of adopting this ASU on its consolidated financial statements and disclosures.

In March 2022, the FASB issued ASU 2022-01, “Derivatives and Hedging (Topic 815): Fair Value Hedging—Portfolio Layer Method” which is intended to make amendments to the fair value hedge accounting previously issued in ASU 2017-12 “Derivatives and Hedging (Topic 815): Targeted Improvements to Accounting for Hedging Activities”. The new standard will be effective for reporting periods beginning after December 15, 2022. The standard introduced the portfolio layer method allowing multiple hedged layers of a single closed portfolio when applying fair value hedge accounting. The adoption of this update is not expected to have a significant impact on the Company’s financial position, results of operations or cash flows and disclosures.

Other recent accounting pronouncements issued by the FASB (including its Emerging Issues Task Force) and the SEC did not or are not expected to have a significant impact on the present or future consolidated financial statements of the Company.

Critical Accounting Policies and Estimates

The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America (“GAAP”) requires the Company to establish accounting policies and make estimates and assumptions that affect reported amounts of assets and liabilities at the date of the consolidated financial statements. These consolidated financial statements include some estimates and assumptions that are based on informed judgments and estimates of management. The Company evaluates its policies and estimates on an ongoing basis and discuss the development, selection and disclosure of critical accounting policies with the audit committee of the board of directors. Predicting future events is inherently an imprecise activity and as such requires the use of judgment. The Company’s consolidated financial statements may differ based upon different estimates and assumptions.

Significant accounting policies are discussed in Note 2, Summary of Significant Accounting Policies, to the consolidated financial statements. The significant accounting policies are subject to judgments and uncertainties that affect the application of such policies. The Company believes that these consolidated financial statements include the most likely outcomes with regard to amounts that are based on management’s judgment and estimates. The consolidated financial position and results of operations may be materially different when reported under different conditions or when using different assumptions in the application of such policies. If estimates or assumptions prove to be different from the actual amounts, adjustments are made in subsequent periods to reflect more current information. The Company believes that the following accounting policies are critical to the preparation of its consolidated financial statements due to the estimation process and business judgment involved in their application:

Principles of Consolidation – South32 Option Agreement

The Company consolidated entities in which it had a controlling financial interest based on either the variable interest entity (VIE) or voting interest model. Generally, the primary beneficiary of a VIE is a reporting entity that has (a) the power to direct the activities that most significantly impact the VIE’s economic performance, and (b) the obligation to absorb losses of, or the right to receive benefits from, the VIE that could potentially be significant to the VIE. Currently, the Company manages the mineral exploration program in the property concessions in Mexico through its wholly-owned subsidiary corporations Minera Metalin.

The Company determined that Minera Metalin was a variable interest entity and it was the primary beneficiary.

Management had applied judgment in reaching its conclusion with respect to accounting for the South32 Option Agreement with South32, described in Note 3 to the consolidated financial statements. Under the South32 Option Agreement, South32 was able to obtain an option to purchase 70% of the shares of Minera Metalin (the “South32 Option”). Management had determined that the South32 Option Agreement did not result in the transfer of control of the Sierra Mojada Project to South32 and that the South32 Option Agreement represented non-employee share-based compensation associated with the collaborative exploration program undertaken by the parties. The compensation cost was expensed when the associated exploration activity occurred. The share-based payments had been classified as equity instruments and valued based on the fair value of consideration received, as it was more reliably measurable than the fair value of the equity interest. In the event the South32 Option was exercised and shares were issued prior to a decision to develop a mine, such shares would have been classified as temporary equity as they would have been contingently redeemable in exchange for a net smelter royalty under circumstances not wholly in control of the Company or South32 and which were not probable. No portion of the equity value has been classified as temporary equity as the South32 Option has no intrinsic value.

Use of Estimates

The preparation of the consolidated financial statements in conformity with GAAP requires management to make estimates based on assumptions about future events that affect the amounts reported in the consolidated financial statements and related notes to the consolidated financial statements. Actual results could differ from those estimates. Estimates and assumptions are reviewed on an ongoing basis based on historical experience and other factors that are considered to be relevant under the circumstances. Revisions to estimates and assumptions are accounted for prospectively.

Significant areas involving the use of estimates include determining the allowance for uncollectible taxes, evaluating recoverability of property concessions, evaluating impairment of long-lived assets, evaluating impairment of goodwill, establishing a valuation allowance on future use of deferred tax assets, calculating a valuation for stock option liability and calculating stock-based compensation.

Accounts Receivable

Accounts Receivable consists of corporate costs that are to be reimbursed by Bench Walk pursuant to the terms of the Funding Agreement. The Company anticipates full recovery of its current receivables within three months.

Property Concessions

Property concession acquisition costs are capitalized when incurred and will be amortized using the units of production method following the commencement of production. If a property concession is subsequently abandoned or impaired, any capitalized costs will be expensed in the period of abandonment or impairment. To date, no property concessions have reached the production stage.

Acquisition costs include cash consideration and the fair market value of shares issued on the acquisition of property concessions.

Exploration Costs

Exploration costs incurred are expensed to the date of establishing that costs incurred are economically recoverable. Exploration expenditures incurred subsequent to the establishment of economic recoverability are capitalized and included in the carrying amount of the related property. To date, the Company has not established the economic recoverability of its exploration prospects; therefore, all exploration costs are being expensed.

Impairment of Long-Lived Assets

The Company reviews and evaluates its long-lived assets for impairment when events and changes in circumstances indicate that the related carrying amounts of its assets may not be recoverable. Impairment is considered to exist if the future cash flows on an undiscounted basis are less than the carrying amount of the long-lived asset. An impairment loss is measured and recorded based on the difference between book value and fair value of the asset group. In estimating future cash flows, assets are grouped at the lowest level for which there is identifiable cash flows that are largely independent of cash flows from other asset groups. In estimating future cash flows, the Company estimates the price that would be received to sell an asset group in an orderly transaction between market participants at the measurement date. Significant factors that impact this price include the price of silver and zinc, and general market conditions for exploration companies, among other factors.

Goodwill

Goodwill is the purchase premium after adjusting for the fair value of net assets acquired. Goodwill is tested for impairment at the reporting unit level at least annually, or more frequently if events or changes in circumstances indicate that the assets may be impaired. Goodwill impairment tests require judgment, including the identification of reporting units, assignment of assets and liabilities to reporting units, assignment of goodwill to reporting units, and determination of the fair value of each reporting unit. Annual goodwill impairment testing is performed on April 30^th of each fiscal year.

Income Taxes

The Tax Cuts and Jobs Act of 2017 was signed into law on December 22, 2017. The law includes significant changes to the U.S. corporate income tax system, including a federal corporate rate reduction from 35% to 21%, limitations on the deductibility of interest expense and executive compensation, and the transition of U.S. international taxation from a worldwide tax system to a territorial tax system. The law did not have a material impact on the Company’s financial position, results of operations or cash flows and disclosures.

The asset and liability method of accounting for income taxes is followed. Under this method, deferred income tax assets and liabilities are determined based on temporary differences between the tax basis and accounting basis of the assets and liabilities measured using tax rates enacted at the balance sheet date. The tax benefit from uncertain tax positions is recognized only if it is at least “more likely than not” that the tax position will be sustained on examination by the taxing authorities, based on the technical merits of the position. The tax benefits recognized in the financial statements from such a position are measured based on the largest benefit that has a greater than 50% likelihood of being realized upon settlement with the taxing authorities. This accounting standard also provides guidance on de-recognition, classification, interest and penalties, accounting in interim periods and disclosure.

A valuation allowance is recorded against deferred tax assets if management does not believe that the Company has met the “more likely than not” standard imposed by this guidance to allow recognition of such an asset. Management recorded a full valuation allowance at October 31, 2023 and October 31, 2022 against the deferred tax assets as it determined that future realization would not meet the “more likely than not” criteria.

Warrant Derivative liability

The Company classified warrants on the Company’s balance sheet as a derivative liability which is fair valued at each reporting period subsequent to the initial issuance as the Company’s functional currency is the U.S. dollar and the exercise price of the warrants is the $CDN. The Company has used the Black-Scholes pricing model to value the warrants that do not have an acceleration feature. Determining the appropriate fair-value model and calculating the fair value of warrants requires considerable judgment. Any change in the estimates used may cause the value to be higher or lower than that reported. The estimated volatility of the common stock of the Company at the date of issuance, and at each subsequent reporting period, is based on historical volatility adjusted to reflect implicit discount to historical volatilities observed in the prices of traded warrants. The risk-free interest rate is based on rates published by the government for bonds with a maturity similar to the expected remaining life of the warrants at the valuation date. The expected life of the warrants is assumed to be equivalent to their remaining contractual term. The dividend yield is expected to be none as the Company has not paid dividends nor does the Company anticipate paying any dividend in the foreseeable future.

The derivative is not traded in an active market and the fair value is determined using valuation techniques. The estimates may be significantly different from those recorded in the consolidated financial statements because of the use of judgment and the inherent uncertainty in estimating the fair value of these instruments that are not quoted in an active market. All changes in the fair value are recorded in the consolidated statement of operations and comprehensive loss each reporting period.

Stock-Based Compensation

The Black-Scholes pricing model is used as a method for determining the estimated fair value for all stock options awarded to employees, officers, directors and consultants. The expected term of the options is based upon an evaluation of historical and expected future exercise behavior. The risk-free interest rate is based on rates published by the government for bonds with a maturity similar to the expected remaining life of the options at the valuation date. Volatility is determined based upon historical volatility of the Company’s stock and adjusted if future volatility is expected to vary from historical experience. The dividend yield is assumed to be none as Silver Bull has not paid dividends nor does it anticipate paying any dividends in the foreseeable future. The graded vesting attribution method is used to recognize compensation costs over the requisite service period.

Cumulative compensation cost associated with options on subsidiary equity are classified as additional paid-in capital until exercised.

Foreign Currency Translation

During the fiscal years ended October 31, 2023 and October 31, 2022, the functional currency of Silver Bull Resources, Inc. and its subsidiaries was the U.S. dollar.

During the fiscal years ended October 31, 2023 and October 31, 2022, Silver Bull’s Mexican operations’ monetary assets and liabilities with foreign source currencies were translated into U.S. dollars at the period-end exchange rate, and non-monetary assets and liabilities with foreign source currencies were translated using the historical exchange rate. The Mexican operations’ revenue and expenses were translated at the average exchange rate during the period except for depreciation of office and mining equipment, costs of office and mining equipment sold and impairment of property concessions, all of which are translated using the historical exchange rate. Foreign currency translation gains and losses of the Mexican operations are included in the consolidated statements of operations.

Accounting for Loss Contingencies and Legal Costs

From time to time, the Company is named as a defendant in legal actions arising from its normal business activities. An accrual for the estimated loss from a loss contingency is recorded when information available prior to issuance of the financial statements indicates that it is probable that a liability has been incurred at the date of the financial statements and the amount of the loss can be reasonably estimated. Disclosure of a loss contingency is made by the Company if there is at least a reasonable possibility that a loss has been incurred, and either an accrual has not been made or an exposure to loss exists in excess of the amount accrued. In cases where only disclosure of the loss contingency is required, either the estimated loss or a range of estimated loss is disclosed or it is stated that an estimate cannot be made. Legal costs incurred in connection with loss contingencies are considered period costs and accordingly are expensed in the period services are provided.

Not applicable.

See “Index to Consolidated Financial Statements” following the signature page of this Annual Report on Form 10-K.

None.

(a)       Evaluation of Disclosure Controls and Procedures

As of October 31, 2023, the Company has carried out an evaluation under the supervision of, and with the participation of its Chief Executive Officer and Chief Financial Officer, of the effectiveness of the design and operation of its disclosure controls and procedures (as defined in Rule 13a-15(e) under the Exchange Act). Based on the evaluation as of October 31, 2023, the Company’s Chief Executive Officer and Chief Financial Officer have concluded that its disclosure controls and procedures (as defined in Rule 13a-15(e) under the Exchange Act) were effective.

Disclosure controls and procedures are designed to ensure that information required to be disclosed in the Company’s reports filed or submitted under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms. Disclosure controls and procedures include, without limitation, controls and procedures designed to ensure that information required to be disclosed in its reports filed under the Exchange Act is accumulated and communicated to management, including the Company’s principal executive officer and principal financial officer, as appropriate, to allow timely decisions regarding required disclosure.

(b)       Management’s Report on Internal Control over Financial Reporting

Management is responsible for establishing and maintaining adequate internal control over financial reporting, as that term is defined in Rule 13a-15(f) under the Exchange Act. Under the supervision and with the participation of the Company’s management, including its principal executive and principal financial officers, the Company assessed, as of October 31, 2023, the effectiveness of its internal control over financial reporting. This assessment was based on criteria established in the Internal Control-Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission. Based on the Company’s assessment using those criteria, management concluded that its internal control over financial reporting as of October 31, 2023 was effective.

Internal control over financial reporting is defined as a process designed by, or under the supervision of, the Company’s principal executive and principal financial officers and effected by its board of directors, management and other personnel to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles, and includes those policies and procedures that:

• pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the Company’s assets;
• provide reasonable assurance that transactions are recorded as necessary to permit the preparation of financial statements in accordance with U.S. generally accepted accounting principles and that receipts and expenditures are being made only in accordance with authorizations of management and directors; and
• provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of assets that could have a material effect on the financial statements.

A control system, no matter how well conceived and operated, can provide only reasonable, not absolute, assurance that the objectives of the internal control system are met. Because of the inherent limitations of any internal control system, no evaluation of controls can provide absolute assurance that all control issues, if any, within a company have been detected.

(c)       Changes in Internal Controls over Financial Reporting

There were no changes in the Company’s internal control over financial reporting during the fiscal year ended October 31, 2023 that materially affected, or were reasonably likely to materially affect, its internal control over financial reporting.

None.

Not applicable.

PART III

Information relating to this item will be included in an amendment to this report or in the proxy statement for Silver Bull’s 2024 annual meeting of shareholders and is incorporated by reference in this report.

The Company has adopted a Code of Ethics that applies to all directors and employees, including its principal executive officer, principal financial officer, principal accounting officer, and those officers performing similar functions. The full text of the Company’s Code of Ethics can be found on the Corporate Governance page of its website – at http://www.silverbullresources.com/corporate/corporate-governance/. If the board of directors approves an amendment to or waiver from any provision of the Code of Ethics, Silver Bull will disclose the required information pertaining to such amendment or waiver on its website.

Information relating to this item will be included in an amendment to this report or in the proxy statement for Silver Bull’s 2024 annual meeting of shareholders and is incorporated by reference in this report.

Information relating to this item will be included in an amendment to this report or in the proxy statement for Silver Bull’s 2024 annual meeting of shareholders and is incorporated by reference in this report.

Information relating to this item will be included in an amendment to this report or in the proxy statement for Silver Bull’s 2024 annual meeting of shareholders and is incorporated by reference in this report.

Information relating to this item will be included in an amendment to this report or in the proxy statement for Silver Bull’s 2024 annual meeting of shareholders and is incorporated by reference in this report.

PART IV

Financial Statements and Financial Statement Schedules

See “Index to Consolidated financial statements” on page F-1.

X Filed herewith.

XX Furnished herewith.

+ Indicates a management contract or compensatory plan, contract or arrangement.

† Filed herewith under Items 1 and 2 – Business and Properties.

†† Portions of this exhibit have been omitted in accordance with Item 601(b)(10) of Regulation S-K. The omitted information is not material, and the registrant customarily and actually treats such information as private and confidential. The registrant hereby agrees to furnish supplementally an unredacted copy of this exhibit to the Securities and Exchange Commission upon request.

* The following financial information from Silver Bull Resources, Inc.‘s Annual Report on Form 10-K for the fiscal year ended October 31, 2023, formatted in XBRL (Extensible Business Reporting Language): Consolidated Balance Sheets, Consolidated Statements of Operations and Comprehensive Loss, Consolidated Statement of Stockholders’ Equity, Consolidated Statements of Cash Flows.

None.

SIGNATURES

Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed by the following persons on behalf of the registrant and in the capacities and on the dates indicated.

INDEX TO CONSOLIDATED FINANCIAL STATEMENTS

SILVER BULL RESOURCES, INC.

(An Exploration Stage Company)

[The balance of this page has been intentionally left blank.]

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To the Board of Directors and Stockholders of Silver Bull Resources, Inc.:

Opinion on the Consolidated Financial Statements

We have audited the accompanying consolidated balance sheets of Silver Bull Resources, Inc. (an exploration stage company) (the “Company”) as of October 31, 2023 and 2022, and the related consolidated statements of operations and comprehensive loss, cash flows, and stockholders’ equity for the years then ended, and the related notes (collectively referred to as the “consolidated financial statements”).

In our opinion, the consolidated financial statements present fairly, in all material respects, the financial position of the Company as of October 31, 2023 and 2022, and the results of its operations and its cash flows for the years then ended, in conformity with

accounting principles generally accepted in the United States of America.

Going Concern Uncertainty

The accompanying consolidated financial statements have been prepared assuming that the Company will continue as a going concern. As discussed in Note 1 to the consolidated financial statements, the Company has suffered recurring losses from operations and has limited cash and cash equivalents at October 31, 2023. These circumstances raise substantial doubt about its ability to continue as a going concern. Management’s plans in regard to these matters are also described in Note 1. The consolidated financial statements do not include any adjustments that might result from the outcome of this uncertainty.

Basis for Opinion

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

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

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

Critical Audit Matters

Critical audit matters are matters arising from the current period audit of the consolidated financial statements that were communicated or required to be communicated to the audit committee and that: (1) relate to accounts or disclosures that are material to the consolidated financial statements and (2) involved our especially challenging, subjective, or complex judgments. The communication of critical audit matters does not alter in any way our opinion on the consolidated financial statements, taken as a whole, and we are not, by communicating the critical audit matters below, providing a separate opinion on the critical audit matters or on the accounts or disclosures to which they relate.

We have determined that there are no critical audit matters to communicate in our auditors’ report.

/s/ Smythe LLP

Smythe LLP, Chartered Professional Accountants

We have served as the Company’s auditor since 2016.

Vancouver, Canada

January 29, 2024

SILVER BULL RESOURCES, INC.

(AN EXPLORATION STAGE COMPANY)

CONSOLIDATED BALANCE SHEETS

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

SILVER BULL RESOURCES, INC.

(AN EXPLORATION STAGE COMPANY)

CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS

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

SILVER BULL RESOURCES, INC.

(AN EXPLORATION STAGE COMPANY)

CONSOLIDATED STATEMENTS OF CASH FLOWS

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

SILVER BULL RESOURCES, INC.

(AN EXPLORATION STAGE COMPANY)

CONSOLIDATED STATEMENTS OF CASH FLOWS (CONTINUED)

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

SILVER BULL RESOURCES, INC.

(AN EXPLORATION STAGE COMPANY)

CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY

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