Liberty Silver Corp. Announces Letter of Intent to Acquire Bunker Hill Mine
Liberty Silver Corp. Announces Letter of Intent to
Acquire Bunker Hill Mine
May 16, 2017 - Toronto, Ontario. Liberty Silver Corp. (“ Liberty” or the
“Company”) is pleased to announce that it has entered into a non-binding
letter of intent to acquire the Bunker Hill Mine Complex located in Kellogg,
Idaho, in the Silver Valley from Placer Mining Corp. (the “Letter of Intent”).
Pursuant to the terms and conditions of the Letter of Intent dated November
27, 2016 and amended on March 29, 2017 , the acquisition is subject to due
diligence, regulatory approval and definitive documentation, which the
Company is required to complete by the close of business on June 29, 2017
(the “Closing Date”).
The acquisition would include all mining rights and claims, surface rights,
easements, existing infrastructure at Milo Gulch, and the majority of
machinery and buildings at the Kellogg Tunnel porta l level , as well as all
equipment and infrastructure anywhere underground at the Bunker Hill Mine
Complex. The acquisition wo uld also include all current and historic data
relating to the Bunker Hill Mine Complex, such as drill logs, reports, maps,
and similar information located at the mine site or any other location.
The Bunker Hill Mine is one of the most storied base metal and silver mines
in American history. Initial discovery and development of the property
began in 1885, and from that time until the mine closed in 1981 it produced
over 35.8 million tons of ore at an average mined grade of 8.76% lead, 4.52
ounces per ton silver, and 3.67% zinc (Bunker Limited Partnership,1985) .
Throughout its long history, over 40 different orebodies were discovered and
mined at the Bunker Hill, primarily consisting of Zinc -Lead-Silver
mineralization. The Bunker Hill and Sullivan Mining Co mpany had a strong
history of regular dividend payment s to shareholders from the time the
Company went public in 1905 until it was acquired in a hostile takeover by
Gulf Resources in 1968. When the mine closed in 1981, it was estimated to
still contain significant resources. (Bunker Limited Partnership,1985)
The Mine and Smelter Complex were closed in 1981 after the then owner,
Gulf Resources, was not able to continue to comply with the new regulatory
structures brought on by the passage of environmental statutes and as then
enforced by the Environmental Protection Agency (EPA). In summary, the
reasons for the mine and smelter complex closures were primarily a result of
compliance with stringent smelter emissions standards, not regulatory issues
with the mine itself.
The Bunker Hill Lead Smelter, Electrolytic Zinc Plant and historic milling
facilities were demolished about 25 years ago , and the area became part of
the “National Priority List” for cleanup under EPA regulations, thereby
pausing development of the Bunker Hill M ine for over 30 years. All of the
cleanup of the old smelter , zinc plant, and associated sites h as now been
completed and the Mine is now poised for fu rther development and an
eventual return to production. The Company has been in conta ct with
government officials who have expressed strong support and cooperation for
the Company efforts to return the mine to being a productive mining asset.
The acquisition price, as described in the Letter of Intent, is a total of
US$30,000,000. The initial US$15,000,000 of the total acquisition price
shall be paid annually over the course of 5 years from the Closing Date, of
which, US$150,000 has been paid upon execution of the Letter of Intent and
US$3,350,000 will become due on the Closing Date, and US$3,500,000 on
the first anniversary, US$3,000,000 on the second anniversary,
US$2,000,000 on the third and fourth anniversaries and US$1,000,000 on
the fifth anniversary. The balance of US$15,000,000 shall become due in 15
equal installments beginning o n June 29, 2023 and on each anniversary of
the Closing Date thereafter. The Letter of Intent provides for conditions
under which the fifteen payments of US$1,000,000 may be accelerated and
paid in shares based on prevailing market prices and share volumes . In
addition, a net smelter return royalty with an aggregate maximum payment
of US$60,000,000 shall be granted, at a rate of 2% for the first
US$15,000,000, 1% for the next US$15,000,000 and 0.5% for the remaining
US$30,000,000. The Company has also made payments totalling
US$280,000 with respect to certain property carrying costs and, for up to
two years after closing, the Company shall hire certain local managerial
staff.
Further announcements will be made on the status of the acquisition of the
Bunker Hill Mine Complex. Technical information in this press release was
reviewed and approved by James Baughman, P.Geo., a consultant to Liberty,
and a Qualified Person under National Instrument 43-101.
About Liberty Silver Corp.
Liberty has the right to earn a joint venture interest in the 10,020 -acre
Trinity Silver Project pursuant to the terms of an earn- in agreement with
Renaissance Exploration Inc. The Trinity Silver Project, located in Pershing
County, Nevada, is Liberty’s flagship project. Liberty has e ntered into the
Letter of Intent to Acquire the Bunker Hill Mine Complex which is subject
to due diligence and definitive documentation.
Information about Liberty is available on its website,
www.libertysilvercorp.com, or in the SEDAR and EDGAR databases.
For additional information contact:
Howard M. Crosby, Chief Executive Officer
(509) 526-3491
Cautionary Statements
Certain statements in this news release are forward -looking and involve a number of risks and uncertainties. Such
forward-looking statements are within the meaning of that term in Section 27A of the Securities Act of 1933, as
amended, and Section 21E of the Securities Exchange Act of 1934, as amended, as well as wi thin the meaning of the
phrase ‘forward- looking information’ in the Canadian Securities Administrators’ National Instrument 51-102 –
Continuous Disclosure Obligations. The forward looking statements made herein are based on information currently
available to the Company and the Company provides no assurance that actual results wil l meet management's
expectations or assumptions with respect to, among other things, the ability of Liberty to successfully complete due
diligence on the Bunker Hill Mine Complex, settle a definitive agreement on the terms as provided in the Letter of
Intent or other satisfactory terms or at all, and fund the initial purchase payment for which Liberty does not have funds
at this time, the ability of Liberty to preserve its interes ts in the Trinity Silver Projec t which is dependent on the
completion of a feasibility study, the Company’s present and future financial condition, the Company’s ability to secure
financing, the Company’s ability to secure a public market for its securities, and the state of financial markets.
Forward-looking statements include estimates and statements that describe the Company ’s future plans, objectives or
goals, including words to the effect that the Company or management expects a stated condition or resul t to occur.
Forward-looking statements may be identified by such terms as “believes”, “anticipates”, “expects”, “estimates”,
“may”, “could”, “would”, “will”, or “plan”, and may include statements regarding, among other things, the terms of
the Letter of Intent to acquire the Bunker Hill Mine Complex, complet ion of the necessary due diligence and funding of
the acquisition. Since forward-looking statements are based on assumptions and address future events and conditions,
by their very nature they involve inherent risks and uncertainties. Actual results relating to, among other things, results
of exploration, project development, and the Company’s financial condition and prospects, could differ materially from
those currently anticipated in such statements for many reasons such as: the inability of Liberty to successfully
complete due diligence on the Bunker Hill Mine Complex, settle a definitive agreement on the terms as provided in the
Letter of Intent or other satisfactory terms or at all, and fund the init ial purchase payment for which Liberty does not
have funds at this time; the inability of Liberty to complete a feasibility study pursuant to the terms of the Trinity Silver
Project earn-in agreement; the in ability of the Company to budget and manage its l iquidity in light of the failure to
obtain additional financing; the inability of the Company to secure a public market for its securities and whether an
active public market can be developed or sustained; development of changes in general economic conditi ons and
conditions in the financial markets; changes in demand and prices for precious metals ; litigation, legislative,
environmental and other judicial, regulatory, political and competitive developments; operational difficulties
encountered in connection with the activities of the Company ; and other matters discussed in this news releas e. This
list is not exhaustive of the factors that may affect any of the Company ’s forward-looking statements. These and other
factors made in public disclosures and filings by the Company should be considered carefully and readers should not
place undue reliance on the Company ’s forward-looking statements. The Company does not undertake to update any
forward-looking statement that may be made from time to time by the Company or on its behalf, except in accordance
with applicable securities laws.