Silver Bull Secures US$9.5M Litigation Funding to Pursue Damages Claim Against the Mexican Government - Seite 2

“The substantial litigation funding secured under the LFA is a testament to the strength of Silver Bull’s claims. The US$9.5 million funding facility is non-dilutive to Silver Bull shareholders and will cover the full legal budget of the claim, expert, and ancillary costs, as well as Silver Bull’s operating expenses. Bench Walk will have a contingent entitlement to damages in the event that damages are awarded.”

Mr. Barry continued, “We note that other companies have successfully enforced their rights through international arbitration and received substantial sums for damages. Recent examples of this include (i) a US$110 million award issued by the World Bank International Centre for Settlement of Investment Disputes (“ICSID”) tribunal in August 2023 to Indiana Resources Ltd. regarding the revocation of its mining license by the Tanzanian Government in 2018, which case was led by our legal counsel Tim Foden from BSF, and (ii) a US$5.8 billion award issued by the World Bank ICSID tribunal to Barrick Gold/Antofagasta regarding Pakistan’s unlawful denial of a mining permit for the Reko Diq copper project.”

BACKGROUND TO THE CLAIM: The arbitration has been initiated under the Convention on the Settlement of Investment Disputes between States and Nationals of Other States process, which falls under the auspices of the World Bank’s International Centre for Settlement of Investment Disputes (ICSID), to which Mexico is a signatory.

Silver Bull officially notified Mexico on March 2, 2023 of its intention to initiate an arbitration owing to Mexico’s breaches of NAFTA by unlawfully expropriating Silver Bull’s investments without compensation, failing to provide Silver Bull and its investments with fair and equitable treatment or full protection and security, and not upholding NAFTA’s national treatment standard.

Silver Bull held a meeting with Mexican government officials in Mexico City on May 30, 2023, in an attempt to explore amicable settlement options and avoid arbitration. However, the 90-day period for amicable settlement under NAFTA expired on June 2, 2023, without a resolution.

Despite repeated demands and requests for action by the Company, Mexico’s governmental agencies have allowed the unlawful blockade to continue, thereby failing to protect Silver Bull’s investments. Consequently, Silver Bull will seek to recover an amount of approximately US$178 million in damages that it has suffered due to Mexico’s breach of its obligations under NAFTA, which includes sunk costs of approximately US$82.5 million, usually considered minimum damages in such cases.