UNITED STATES
SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 10-K

(Mark One)

☒ ANNUAL REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the fiscal year ended December 31, 2024

or

☐ TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from _______ to _______

Commission File Number: 000-14740

PREMIUM RESOURCES LTD.

(Exact Name of Registrant as Specified in Its Charter)

(604) 770-4334

Registrant’s telephone number, including area code

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

Common Shares
(Title of class)

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 Section 15(d) of the 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 small Reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company” or an “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 Act). Yes ☐ No ☒

The aggregate market value of the voting and non-voting common equity held by non-affiliates on June 30, 2024, was approximately US$89 million.

As of March 19, 2025, there were 428,986,474 Common Shares issued and outstanding.

PREMIUM RESOURCES LTD.

Annual Report on Form 10-K
For the year ended December 31, 2024

TABLE OF CONTENTS

Part I

Cautionary Note Regarding Forward-Looking Statements

This Annual Report on Form 10-K (this “Report”) for Premium Resources Ltd. (the “Company” or “PREM”) (as defined herein), contains forward-looking statements that relate to future events or our future financial performance. These statements involve known and unknown risks, uncertainties and other factors that may cause our actual results, levels of activity, performance or achievements to be materially different from any future results, levels of activity, performance or achievements expressed or implied by the forward-looking statements. These risks and other factors include those listed under “Risk Factors” in Part I, Item 1A and elsewhere in this Report. In some cases, you can identify forward-looking statements by terminology such as “may,” “will,” “should,” “expects,” “plans,” “anticipates,” “believes,” “estimates,” “predicts,” “potential,” “continue” or the negative of these terms or other comparable terminology.

Forward-looking statements involve known and unknown risks, uncertainties and other factors that may cause our actual results, performance or achievements to be materially different from any future results, performances or achievements expressed or implied by the forward-looking statements. We discuss many of these risks in greater detail under the heading “Risk Factors”. Given these uncertainties, you should not place undue reliance on these forward-looking statements. Also, forward-looking statements represent our management’s beliefs and assumptions only as of the date hereof. You should read this Report and the documents that we have filed as exhibits to this Report completely and with the understanding that our actual future results may be materially different from what we expect.

Except as required by law, we assume no obligation to update these forward-looking statements publicly, or to update the reasons actual results could differ materially from those anticipated in these forward-looking statements, even if new information becomes available in the future. Given these risks and uncertainties, readers are cautioned not to place undue reliance on such forward-looking statements.

Unless otherwise indicated, all references to “$”, “C$” and “dollars” in this Report refer to Canadian dollars, references to “US$” in this Report refer to United States dollars and references to “BWP” in this Report refer to Botswanan pula. On December 31, 2024, the daily exchange rate: (i) for one United States dollar expressed in Canadian dollars was US$1.00 = C$1.4389 (or C$1.00 = US$0.6950); (ii) for one Botswanan pula expressed in Canadian dollars was BWP 1.00 = C$0.1018 (or C$1.00 = BWP 9.8232); and (iii) for one Botswanan pula expressed in United States dollars was BWP 1.00 = US$0.0707 (or US$1.00 = BWP 14.1346). “This quarter” or “the quarter” means the fourth quarter (“Q4”) of 2024. “Year-to-date” or “year-to-date period” means the twelve months ended December 31 (“YTD”).

Item 1. BUSINESS.

Premium Resources Ltd. and its wholly-owned subsidiaries’ principal business activity is the exploration and evaluation of PREM’s flagship asset, the Selebi nickel-copper-cobalt sulphide mine in Botswana and, separately, the Company’s Selkirk nickel-copper-cobalt-platinum group elements sulphide mine, also in Botswana. The common shares of PREM (“Common Shares”) are listed and posted for trading on the TSX Venture Exchange (the “TSXV”) under the symbol “PREM”. Prior to November 20, 2024, the Company traded on the TSXV under its previous name and symbol, Premium Nickel Resources Ltd. and PNRL, respectively. In addition, the Common Shares are currently quoted on the OTC Pink Open Market under the symbol “PRMLF”.

The following corporate structure chart sets out details of the direct and indirect ownership of the principal subsidiaries of the Company:

Notes:

The Company’s head and registered office is located at One First Canadian Place, 100 King Street West, Suite 3400, Toronto, Ontario, Canada, M5X 1A4.

PREM is a mineral exploration and evaluation company focused on the discovery and advancement of high-quality nickel-copper-cobalt-platinum group elements (“Ni-Cu-Co-PGE”) resources. The principal assets of the Company are the Selebi and Selebi North nickel-copper-cobalt (“Ni-Cu-Co”) mines in Botswana and related infrastructure (together, the “Selebi Mines”), as well as the Ni-Cu-Co-PGE Selkirk mine in Botswana, together with associated infrastructure and four surrounding prospecting licences (collectively, the “Selkirk Mine” and together with the Selebi Mines, the “Mines”).

The Selebi and Selkirk mines are permitted with 10-year mining licences, granted in 2022, and renewable upon the submission of approved mine plans and other customary conditions, and benefit from significant local infrastructure. The Company’s flagship Selebi Mines includes two operational shafts, the Selebi and Selebi North shafts, and related infrastructure such as rail, power and roads.

Summary of Activities

In 2023, PREM commenced its Phase 2 drill program undertaking a combination of resource and continued exploration drilling at the Selebi Mines to demonstrate the size potential of the Selebi Mines mineral system, with the aim of establishing an initial mineral resource estimate on the Selebi Mines (the “Initial Selebi MRE”).

On December 23, 2024, the Company filed the Initial Selebi MRE in conformance with the United States Securities and Exchange Commission’s (“SEC”) Modernized Property Disclosure Requirements for Mining Registrants as described in Subpart 1300 of Regulation S-K, Disclosure by Registrants Engaged in Mining Operations (S-K 1300) and Item 601(b)(96) Technical Report Summary, entitled “S-K 1300 Technical Report Summary, Selebi Mines, Central District, Republic of Botswana” (the “Selebi TRS”) and dated December 17, 2024 (with an effective date of June 30, 2024) for its Selebi Mines. The Initial Selebi MRE will serve as the basis for future engineering and economic studies.

The Selebi North underground (“SNUG”) resource and exploration drilling program continued throughout 2024 and into 2025. During 2024 and up to the date of this Report, the Company has drilled approximately 45,827 metres in 87 holes, bringing the SNUG drilling program total to 63,947 metres in 162 holes. Assays for a total of 33,963 metres across 80 completed holes have not been accounted for in the Initial Selebi MRE.

The Company has begun testing the deeper borehole electromagnetic (“BHEM”) plates from N2 Limb and South Limb at SNUG. These assay results will continue to be released as they are received and confirmed by the Company.

During 2024, drill core from 17 historic holes at the Selkirk Mine were resampled to augment the historical database. Prospecting licences were explored through data compilation, differential global positioning system (“DGPS”) of historic collars, surface prospecting, and two surface electromagnetic (“EM”) surveys. Resampling of additional holes is underway with 20 holes transferred from Selkirk to the core processing facility at Selebi.

On January 31, 2025, the Company filed the Selkirk MRE in conformance with the SEC’s Modernized Property Disclosure Requirements for Mining Registrants as described in Subpart 229.1300 of Regulation S-K, Disclosure by Registrants Engaged in Mining Operations (S-K 1300) and Item 601(b)(96) Technical Report Summary, entitled “S-K 1300 Technical Report Summary, Selkirk Nickel Project, North East District, Republic of Botswana” (the “Selkirk TRS”) and dated January 8, 2025 (with an effective date of November 1, 2024) for its Selkirk Mine. The Selkirk MRE serves as a solid foundation for advancing the Selkirk deposit to an economic study.

For more information relating to the contemplated activities and milestones on the Mines, please see “Properties – Mining Properties – Selebi Mines” and “Properties – Mining Properties – Selkirk Mine” below.

Highlights and Key Developments

Corporate Social Responsibility

The Company is committed to conducting its business in a socially responsible and sustainable manner, with a focus on environmental stewardship, health and safety, community engagement and ethical conduct. The Company has established policies and procedures in its Code of Business Conduct and Ethics to ensure compliance with applicable laws and regulations, as well as industry standards for responsible mining. PREM recognizes the importance of stakeholder engagement and works closely with local communities, indigenous groups and other stakeholders to ensure their concerns and perspectives are heard and addressed.

Exploration and Evaluation Activities

The following table outlines the key milestones, estimated timing and costs related to each of the Mines, based on the Company’s reasonable expectations, intended courses of action and current assumptions and judgement, with information based as of December 31, 2024.

Notes:

Readers are cautioned that the above represents the opinions, assumptions and estimates of management considered reasonable at the date the statements are made and are inherently subject to a variety of risks and uncertainties and other known and unknown factors that could cause actual events or results to differ materially from those described above. See “Cautionary Note Regarding Forward-Looking Statements”.

Available Information

We file annual, quarterly, current reports and other information with the SEC. You may read and copy any reports, statement or other information that we file with the SEC at the SEC’s public reference room at 100 F Street, N.E., Washington, D.C. 20549. Please call the SEC at (202) 551-8090 for further information on the public reference room. These SEC filings are also available to the public from commercial document retrieval services and at the Internet site maintained by the SEC at http://www.sec.gov.

The Company’s website is https://premiumresources.com/. The Company’s website is not incorporated in this Report.

Item 1A. RISK FACTORS

The business of the Company being the exploration and evaluation of mineral properties in Botswana and Canada is speculative and involves a high degree of risk. These risks may have a material and adverse impact on the future operations, financial performance and condition of the Company and the value of the Common Shares. Although the Company has been successful in its past fund-raising activities, there is no assurance as to the success of future fundraising efforts or as to the sufficiency of funds raised in the future.

An investment in the Company’s Common Shares involves a high degree of risk. The following discussion highlights the risks and uncertainties we believe are material to the Company, but the following discussion does not necessarily include all the risks we may face and an investor in the Company’s Common Shares should not interpret the disclosure of a risk in the following discussion to state or imply that the risk has not already materialized. In evaluating an investment in the Company, the risks and uncertainties described below should be carefully considered. If any such risks occur, the business, financial condition and/or liquidity and results of operations of the Company could be materially adversely affected. In this event, the value of the Common Shares could decline and shareholders could lose all or part of their investment.

Further, the Company’s view of risks is not static, and readers are cautioned that there can be no assurance that all risks to the Company, at any point in time, can be accurately identified, assessed as to significance or impact, managed or effectively controlled or mitigated. There can be additional new or elevated risks to the Company that are not described herein or in the Company’s public filings to date.

The summary and risks that follow are organized under headings as determined to be most applicable, but such risks also may be relevant to other headings.

I. RISKS RELATED TO EXPLORATION & EVALUATION PROJECTS

Inherent risks associated with discovering commercially-viable deposits

The Company’s projects are in their exploration and evaluation stages. The exploration of mineral deposits involves significant financial risks over a prolonged period of time, which may not be eliminated even through a combination of careful evaluation, experience and knowledge.

Most exploration projects do not result in the discovery of commercially-mineralized deposits. The commercial viability of exploiting any precious or base-metal deposit is dependent on a number of factors including infrastructure and governmental regulation, in particular those relating to environment, taxes and royalties. No assurance can be given that minerals will be discovered of sufficient quality, size and grade on any of the Company’s properties to justify a commercial operation.

Development of the Company’s properties will occur only after obtaining satisfactory exploration results. Although the Company’s properties were past producing, few properties which are explored are ultimately developed into economically viable operating mines. There is no assurance that the Company’s mineral exploration activities will result in the discovery of a body of commercial ore on its exploration properties. Several years may pass between the discovery and development of commercial mineable mineralized deposits.

Exploration projects also face significant operational risks including but not limited to an inability to obtain access rights to properties, accidents, equipment breakdowns, labour disputes (including work stoppages and strikes), impact of health epidemics and other outbreaks of communicable diseases and other unanticipated interruptions

Ability to establish our mineral reserves

The Company is a mineral exploration and development company that is focused on the redevelopment of the previously producing Mines. To that end, the Company’s properties have no established mineral reserves at this time. While the Selebi and Selkirk projects have mineral resource estimates (“MREs”), the Company has not yet established any proven or probable mineral reserves on the Selebi Mines or Selkirk Mine projects. The lack of established mineral reserves means that the economic viability of the Selebi and Selkirk projects has not been confirmed. There is no assurance that further exploration will lead to the discovery of an economically viable mineral deposit.

Further, there is no assurance that any of the Company’s projects can be mined profitably. Accordingly, it is not assured that the Company will realize any profits in the short to medium term, if at all. Any profitability in the future from the business of the Company will be dependent upon the development and commercial mining of economically viable mineral deposits, which in itself is subject to numerous risk factors.

The exploration and development of mineral deposits involves a high degree of financial risk over a significant period of time that even a combination of management’s careful evaluation, experience and knowledge may not eliminate. Few properties that are explored are ultimately developed into producing mines. Major expenses may be required to establish resources and reserves by drilling and to construct mining and processing facilities at a particular site. It is impossible to ensure that current work programs of the Company will result in profitable commercial mining operations. The profitability of the Company’s operations will be, in part, directly related to the cost and success of its work programs, which may be affected by a number of factors. Substantial expenditures are required to establish mineral reserves that are sufficient to support commercial mining operations.

Inherent risks associated with the economics of developing mineral properties

Substantial expenses are required to establish and upgrade mineral resources and mineral reserves through drilling, to develop metallurgical processes to extract metal from ore and to develop the mining and processing facilities and infrastructure at any site chosen for mining. No assurance can be given that minerals will be discovered in sufficient quantities to justify commercial operation or that the funds required for development can be obtained on a timely basis.

The marketability of any minerals acquired or discovered may be affected by numerous factors which are beyond the Company’s control and which cannot be predicted, such as market fluctuations, the proximity and capacity of milling facilities, mineral markets and processing equipment, and such other factors as government regulations, including regulations relating to royalties, allowable production, importing and exporting of minerals, and environmental protection. Depending on the price of minerals produced, the Company may determine that it is impractical to commence commercial production.

II. FINANCIAL RISKS

Negative operating cash flow, reliance on additional financing, and ability to continue operations as a going concern

The Company has negative cash flow from operations. As a result of the expected expenditures to be incurred by the Company for the exploration and advancement of the Company’s material projects, the Company anticipates that negative operating cash flows will continue until one or both of the Company’s material projects enters commercial production (if at all). There can be no assurance that the Company will generate positive cash flow from operations in the future.

The Company will require additional capital in order to fund its future activities for its material projects and maintain and grow its operations. Furthermore, additional financing, whether through the issue of additional equity and/or debt securities and/or project level debt, will be required to continue the development of the Company’s material projects and there is no assurance that additional capital or other types of financing will be available or that these financings will be on terms at least as favourable to the Company as those previously obtained, or at all. These material uncertainties cast substantial doubt about the Company’s ability to continue as a going concern. The accompanying Financial Statements do not include any adjustments relating to the recoverability and classification of recorded asset amounts and classification of liabilities, and the reported expenses and comprehensive loss that might be necessary should the Company be unable to continue as a going concern. These adjustments could be material. In assessing whether a going concern assumption is appropriate, management considers all available information about the future, which is at least, but not limited to, twelve months from the date of this Report.

From time to time, the Company may issue new shares, seek debt financing, dispose of assets, or enter into transactions to acquire assets or shares of other corporations. These transactions may be financed wholly or partially with debt, which may temporarily increase the Company’s debt levels above industry standards.

Failure to obtain additional financing or to achieve profitability and positive operating cash flows will have a material adverse effect on its financial condition and results of operations.

III. OPERATIONAL RISKS

Uninsured risks and hazards

Mining is capital intensive and subject to a number of risks and hazards, including environmental pollution, accidents or spills, industrial and transportation accidents, labour disputes, changes in the regulatory environment, natural phenomena (such as inclement weather conditions, earthquakes, pit wall failures and cave-ins) and encountering unusual or unexpected geological conditions. Such risks and hazards might impact the Company’s business. Consequently, many of the foregoing risks and hazards could result in damage to, or destruction of, the Company’s mineral properties or future processing facilities, personal injury or death, environmental damage, delays in or interruption of or cessation of exploration or other activities, delay in or inability to receive required regulatory approvals, or costs, monetary losses and potential legal liability and adverse governmental action. The Company may be subject to liability or sustain loss for certain risks and hazards against which it does not or cannot insure or against which it may reasonably elect not to insure because of the cost. This lack of insurance coverage could result in material economic harm to the Company.

Risks of doing business outside Canada

The Company’s material mineral projects are located in the Republic of Botswana. The Company’s anticipated operations outside North America could subject the Company to a variety of additional risks that may negatively impact its business and operations including any of the following: changes in rules and regulations (including required royalties); failure of local parties to honour contractual relations; delays in obtaining or the inability to obtain necessary governmental permits; opposition to mining from environmental or other non-governmental organizations; limitations on foreign ownership; limitations on the repatriation of earnings; economic or tax policies; tariffs and trade barriers; regulations related to customs and import/export matters; longer payment cycles; tax issues; currency fluctuations and exchange controls; rates of inflation; challenges in collecting receivables; cultural and language differences; employment regulations; crimes, strikes, riots, civil disturbances, terrorist attacks, and wars; and deterioration of political relations with Canada or other governments or sanctions imposed by Canada or other governments. There will also be currency exchange risks in connection with the operations of the Company’s foreign mineral assets, including the Mines.

In addition, Botswana is considered an emerging market. Emerging market investments generally pose a greater degree of risk than investments in more mature market economies because the economies in the developing world are more susceptible to destabilization resulting from domestic and international developments. Further, the current, or a future government may adopt substantially different policies, take arbitrary action which might halt exploration or production, re-nationalize private assets or cancel contracts, or cancel mining or exploration rights, any of which could result in a material and adverse effect on the Company’s results of operations and financial condition.

Dependence on business and technical expertise of Management Team

The Company is dependent on the business and technical expertise of its management team. If it is unable to rely on this business and technical expertise, or if any of the expertise is inadequately performed, the business, financial condition and results of the operations of the Company could be materially adversely affected until such time as the expertise could be replaced.

IV. RISKS RELATED TO OUR COMMON STOCK

Internal and external factors could impact the volatility of our Common Share price

The price of Common Shares may be affected by a number of factors, including global macroeconomic developments and market perceptions of the attractiveness of particular industries and location of assets, which may increase the volatility of Common Share prices. The price of Common Shares will also be affected by the Company’s financial conditions or results of operations as reflected in its liquidity position and earnings reports.

Other factors unrelated to the Company’s operations and performance that may have an effect on the price of Common Shares include: reduced trading volume and general market interest in the Company’s securities may affect an investor’s ability to trade significant numbers of shares; the size of the Company’s public float may limit the ability of some institutions to invest in the Company’s securities; and a substantial decline in the price of Common Shares that persists for a significant period of time could cause the Company’s securities to be delisted, further reducing market liquidity.

As a result of any of these factors, the market price of Common Shares at any given point in time may not accurately reflect the Company’s long-term value. Securities class action litigation often has been brought against companies following periods of volatility in the market price of their securities. The Company may in the future be the target of similar litigation. Securities litigation could result in substantial costs and damages and divert management’s attention and resources.

V. ECONOMIC AND MARKET RISKS

The volatility of commodity prices could affect the economic viability of our projects

The advancement of the Company’s properties is dependent on the future prices of minerals and metals. As well, should any of the Company’s properties eventually enter commercial production, the Company’s profitability will be significantly affected by changes in the market prices of minerals and metals.

Base and precious metals prices are subject to volatile price movements, which can be material and occur over short periods of time and which are affected by numerous factors, all of which are beyond the Company’s control. Such factors include, but are not limited to, actual and expected macroeconomic and political conditions, interest and exchange rates, inflation or deflation, fluctuations in the value of the U.S. dollar and foreign currencies, global and regional supply and demand, speculative trading, the costs of and levels of base and precious metals production, the availability and costs of substitutes, investments by commodity funds and other actions of participants in the commodity markets. Such external economic factors are in turn influenced by changes in international investment patterns, monetary systems, the strength of and confidence in the U.S. dollar (the currency in which the prices of base and precious metals are generally quoted), and political developments. The effect of these factors on the prices of base and precious metals, and therefore the economic viability of any of the Company’s exploration projects, cannot be accurately determined. The prices of commodities have historically fluctuated widely, and future price declines could cause the development of (and any future commercial production from) the Company’s properties to be impracticable or uneconomical. As such, the Company may determine that it is not economically feasible to commence commercial production at some or all of its properties, which could have a material adverse impact on the Company’s financial condition and results of operations. In such a circumstance, the Company may also curtail or suspend some or all of its exploration and evaluation activities.

Foreign currency and equity market fluctuations

The Company is also exposed to risks relating to its financial instruments and foreign currency. The Company operates in Canada, Barbados and Botswana and undertakes transactions denominated in foreign currencies such as United States dollars, Euros, and the Botswanan pula, and consequently is exposed to exchange rate risks. The Company is also exposed to equity price risk; the movements in individual equity prices or general movements in the level of the stock market may potentially have an adverse impact on the Company’s earnings. The Company closely monitors individual equity movements and the stock market to determine the appropriate course of action to be taken.

Acquisition of Botswana assets and related purchase commitments

On January 31, 2022, the Company closed the acquisition of the Selebi project. However, pursuant to the terms of the acquisition, the Company has to comply with certain milestone payments, which if not satisfied, will result in the Selebi project reverting to the BCL Liquidator. There are approximately US$55 million in contingent post-closing milestone payments due to the BCL Liquidator in connection with the Selebi project, with (i) US$25 million due on January 31, 2026, and (ii) another US$30 million due upon the earlier of the commissioning and start of production at the Selebi project or four years from the Selebi mining licence renewal date. The failure of the Company to comply with all the post-closing covenants and contingent milestone payments relating to the Selebi project (if and when those milestones are achieved), could materially adversely affect the business, operations and financial conditions of the Company and impact the market price of the Common Shares. In addition, PREM closed its purchase of the Selkirk Mine in August 2022.

VI. REGULATORY RISKS

Compliance with governmental regulation

Exploration, development, and operations on the Company’s properties will be affected to varying degrees by: (i) government regulations relating to such matters as environmental protection, health, safety and labor; (ii) mining law reform; (iii) restrictions on production, price controls, and tax increases; (iv) maintenance of claims; (v) tenure; and (vi) expropriation of property. There is no assurance that future changes in such regulation, if any, will not adversely affect the Company’s operations. Changes in such regulation could result in additional expenses and capital expenditures, availability of capital, competition, reserve uncertainty, potential conflicts of interest, title risks, dilution, and restrictions and delays in operations, the extent of which cannot be predicted. The Company is at the exploration and evaluation stages on its material properties. Exploration on the Company’s properties requires responsible best-exploration practices to comply with the Company’s policies, government regulations, and maintenance of claims and tenure.

If any of the Company’s projects advance to the development stage, those operations will also be subject to various laws concerning development, production, taxes, labour standards, environmental protection, mine safety and other matters. In addition, new laws governing operations and activities of mining companies could have a material adverse impact on any project in the mine development stage that the Company may possess.

Ability to obtain or adhere to permits, licences and approvals

The operations of the Company require licences and permits from various governmental authorities. The Company believes it holds or is in the process of obtaining all necessary licences and permits to carry on the activities which it is currently conducting under applicable laws and regulations. Such licences and permits are subject to changes in regulations and in various operating circumstances. There can be no guarantee that the Company will be able to obtain all necessary licences and permits that may be required to maintain its mining activities or advance its mineral properties. In addition, if the Company proceeds to production on any exploration property, it must obtain and comply with permits and licences which may contain specific conditions concerning operating procedures, water use, the discharge of various materials into or on land, air or water, waste disposal, spills, environmental studies, abandonment and restoration plans and financial assurances. There can be no assurance that the Company will be able to obtain such permits and licences or that it will be able to comply with any such conditions.

Compliance with environmental regulations

All phases of the Company’s operations are subject to environmental regulation in the jurisdictions in which the Company operates. Environmental legislation is evolving in a manner which has been subject to stricter standards and enforcement, increased fines and penalties for non-compliance, more stringent environmental assessments of proposed properties and a heightened degree of responsibility for companies and their officers, directors and employees. There is no assurance that future changes in environmental regulations, if any, will not adversely affect the Company’s operations. The cost of compliance with changes in governmental regulations has the potential to preclude entirely the economic development of a property. The Company has or will, as applicable, adopt environmental practices designed to ensure that it will comply with or exceed all environmental regulations currently applicable to it.

Changes in tax legislation or accounting rules could affect the profitability of the Company

Changes to, or differing interpretation of, taxation laws in Canada, Barbados, Botswana, or any of the countries in which the Company’s assets or relevant contracting parties are located, could result in some or all of the Company’s profits being subject to additional taxation. New taxation rules or accounting policies enacted could result in the Company’s profits being subject to additional taxation and could have a material adverse effect on the Company’s profitability, results of operations, financial condition and the trading price of the Company’s securities. In addition, the introduction of new tax rules or accounting policies, or changes to, or differing interpretations of, or application of, existing tax rules or accounting policies could make acquiring additional resource properties by the Company less attractive to counterparties. Such changes could adversely affect the Company’s ability to acquire new assets or make future investments.

VII. EMERGING MARKETS RISKS

Operations in emerging markets

The Company has its material properties and operating subsidiaries in Botswana. It is possible that operating in Botswana may expose the Company to a certain degree of political, economic and other risks and uncertainties. In conducting its operations in Botswana, the Company has, among other things: (i) engaged and maintained experienced management and technical teams located in Botswana and/or with extensive experience in operating properties in Africa; (ii) certain members of the Board of Directors and management routinely visit the Company’s Botswana properties; (iii) retained advisors and technical experts in Botswana including its local counsel, Bookbinder Business Law (“Bookbinder”); and (iv) generally maintained robust internal control over its foreign subsidiaries, all of which are more particularly described below.

Subsidiaries and operations in Botswana

The Company’s principal business activity in Botswana is the re-development of the Mines.

The establishment and development of PNGPL and PNRPL, each of which is a Botswanan entity, adds an additional regulatory framework within which the Company operates and is supplementary to the regulatory framework existing in Canada. The Company holds its interest in the Selebi Mines and the Selkirk Mine indirectly through its 100% owned subsidiaries PNRPL and PNGPL, respectively.

The Company’s operating entities in Botswana are governed in accordance with applicable local laws and entity-wide governance principles. The directors and management of the Company’s operating entities in Botswana are generally comprised of a majority of senior management employees and where required by local laws, local residents, who are generally longstanding local management level employees, or local corporate counsel. In addition, certain members of the Company’s management have experience conducting business in Botswana, as detailed below, where the Company has maintained operations since 2021. Operating in Botswana requires greater internal controls and adherence to a regulatory framework which creates challenges in relation to decision-making, communication, and compliance. The Company has experienced management and has retained local legal advisors and consultants to help facilitate adherence to regulatory requirements of Botswana in order to meet this challenge.

We rely on our experienced Board and management

In addition to their experience with the Company, the Board of Directors and management also has extensive experience operating and managing investments and projects in Africa. Furthermore, they bring diverse expertise in areas such as global strategy, finance, exploration, technology, and corporate development. Their collective experience spans several decades and includes successful ventures in both public and private sectors. Certain members of the Board of Directors, management and senior officers of the Company have made trips to Botswana to gain a deeper understanding of the Company’s operations and projects as well as to impart their experience and knowledge of the local business, culture and practices to the other members of the Board of Directors and officers.

The Company also relies on the expertise of its local Botswana-based personnel, Mr. Borris Kamstra, Mr. Kneipe Setlhare, and Mr. Karabo Monepe, all of whom have extensive mining and government relations experience in Botswana.

Overall, the Company benefits from and relies on the collective wealth of expertise and experience in the Company’s business and operations in Botswana of its Board of Directors, management, locally based personnel and technical teams.

Use of and reliance on experts and local advisors

The Company has retained Bookbinder, a Botswanan law firm to advise on various corporate and regulatory legal issues, including the Company’s right to conduct business in Botswana and title verification over the Botswanan assets, and has relied on advice from Bookbinder with respect to such matters. Additionally, the Company has retained engineering and geoscientific services firms including SRK Consulting, SLR Consulting, DRA Global (“DRA”), SGS Mineral Services, and Expert Process Solutions. The Company ensures that any such counsel or provider retained has their credentials vetted and referenced, with considerable diligence and adherence to local licences, professional associations and regulators.

The Company’s officers and Board of Directors benefit from the advice and guidance provided by its Botswanan legal advisor as well as personnel based in Botswana of new developments in local mining regimes and new requirements that come into force from time to time, as they pertain to and affect the Company’s business and operations in Botswana. Any material developments are subject to oversight and discussion by the Board of Directors.

Language, cultural differences and business practices

English is the official language of Botswana, in which the Audit and Risk Management Committee of the Company and the Company’s external auditors are proficient. The most widely spoken language in Botswana is Setswana. The languages spoken by the Board, management and technical team of the Company and its subsidiaries include Afrikaans, English and Setswana.

The financial records of the Company and both PNGPL and PNRPL, existing under the laws of Botswana are maintained in English. The Company does not believe that any material language or cultural barriers exist.

Item 1B. UNRESOLVED STAFF COMMENTS

None.

Item 1C. CYBERSECURITY

Cybersecurity Risk Management and Strategy

Cybersecurity Governance

The governance of cybersecurity risks will be a critical function of our Board, which will have a key role in the oversight of cybersecurity and related technology risks. The Board will be tasked with monitoring the effectiveness of our cybersecurity risk management program, once adopted.

The Board will receive regular updates from management on the state of cybersecurity risks facing the Company. This includes briefings on any significant cybersecurity incidents and ongoing cybersecurity risk management efforts.

The responsibility for day-to-day management of cybersecurity risks lies with the Chief Financial Officer and Chief Executive Officer, with assistance from other members of management and contracted information technology consultants. The Company’s contracted information technology consultants consist of highly experienced professionals in the areas of network security and disaster recovery. This team will be at the forefront of our cybersecurity initiatives, coordinating both internal and external resources to anticipate, identify, and mitigate cyber threats. Our approach will include regular updates from our third-party security expert consultant, leveraging intelligence from various sources, and utilizing advanced security tools to protect our digital environment.

Item 2. PROPERTIES.

In determining the Company’s material properties, management considered both quantitative and qualitative factors, assessed in the context of the Company’s overall business and financial condition. The Company concluded that, as of the date of the filing of this Report, the Company’s only material mining properties are the Selebi Mines and the Selkirk Mine. The Company will update its assessment of individually material mines on an annual basis.

The Company also holds interests in certain exploration stage properties located in Canada, however, the Company has determined that such properties are not independently material to the Company at this time. For more information, see below under the heading “Canada Nickel Projects – Sudbury, Ontario”.

Selebi Mines

The information that follows relating to the Selebi Mines is derived from, and in some instances is an extract from, the Selebi TRS. Portions of the following information are based on assumptions, qualifications and procedures which are not fully described herein. Reference should be made to the full text of the Selebi TRS, which has been included as Exhibit 96.1 to this Report. In the event that we determine that any modifying factors, estimates and other scientific and technical information in the report materially change, we may update or file a new technical report in the future. The Selebi Mines is an exploration stage property.

Pursuant to Item 1302(b)(5) of Regulation S-K (17 C.F.R. §229.1302(b)(5)), the Company states that the Selebi TRS was prepared by SLR Consulting (Canada) Ltd (“SLR”). The qualified persons of SLR meet the qualifications specified under the definition of “qualified person” under Item 1300 of Regulation S-K.

Property Description and Location

The Selebi Mines are located in Botswana approximately 150 km southeast of the city of Francistown, and 410 km northeast of the national capital Gaborone. The Selebi Mines are readily accessed via paved and gravel roads from the town of Selebi-Phikwe, located just north of the mining licence. With a population of approximately 52,000, the town is accessed via a well-maintained paved road that branches due east from the major A1 highway at the town of Serule, 57 km from the Selebi Mines.

The Selebi Mines infrastructure includes two mines, currently on care and maintenance, Selebi (#2 Shaft) and Selebi North (#4 Shaft), and associated surface infrastructure.

Land Tenure

The Selebi Mines consists of a single mining licence covering an area of 11,504 hectares. The mining licence is centered approximately at 22°03’00”S and 27°47’00”E.

Mining licence 2022/1L was granted to PNRPL on January 31, 2022, over the Selebi Mines deposits discovered under mining licence 4/72. The original licence which had been granted to BCL Limited (“BCL”) on March 7, 1972, which covered both Selebi and Phikwe project areas, was amended several times and renewed once, and was set to expire on March 6, 2022. The current mining licence is limited to the Selebi and Selebi North deposits and their surrounding areas, expires May 26, 2032, and excludes the Phikwe mines and associated infrastructure.

History

Exploration in the Selebi Mines area was initiated in 1959 by Bamangwato Concessions Limited (“Bamangwato”) and included soil geochemistry, geological mapping, trenching, and diamond drilling over the then combined Selebi-Phikwe area. The Selebi and Phikwe discoveries were made in 1963 and 1967, respectively, and a single mining lease was granted to Bamangwato in 1967 covering both areas.

Bamangwato changed its name to BCL in 1977 and operated the combined Selebi-Phikwe project from 1970 until its closure in 2016. Nickel and copper ore was mined from an open pit at Phikwe (1971 to 1980), as well as four distinct underground production areas namely Phikwe (1981 to 2016), Southeast Extension (at Phikwe, 1997 to 2016), Selebi North (1990 to 2016) and Selebi (1980 to 2016). Head grades declined from 2010 to 2015 and in October 2016 BCL was placed into provisional liquidation and all its operations put under care and maintenance.

PREM acquired the Selebi Mines and current Selebi mining lease from the BCL Liquidator on January 31, 2022.

Geological Setting, Mineralization and Deposit

The eastern portion of Botswana forms part of the Limpopo Mobile Belt (“LMB”) which represents a deep crustal section through an orogenic province between the Kaapvaal and Zimbabwe Cratons.

The Selebi Mines are located in highly deformed and metamorphosed Archean gneisses near the north margin of the central zone (“CZ”) of the LMB. The CZ region is characterized by complex structural fold patterns accompanied by regional and cataclastic metamorphism with grades ranging from amphibolite to granulite facies and cataclastic tectonites.

The deposits in the Selebi Mines area are categorized as ortho-magmatic nickel-copper sulphide-type deposits. They are hosted within amphibolite and understood as a tectono-metamorphically modified tholeiitic magma parents with an immiscible sulphide melt which has undergone all the phases of deformation that have affected the enclosing gneisses. They form part of the Selebi-Phikwe belt of intrusions that also contain the Phikwe, Dikoloti, Lentswe, and Phokoje deposits.

All mineralization horizons pinch and swell, are conformable to the gneissic foliation, and are hosted within or at the hanging wall contact of amphibolite with the gneissic country rocks. Mineralization horizons range in thickness from very thin to over 20 m thick and are commonly one to three metres thick (deposit dependent). Orientation follows country rock foliation, and the zones can dip moderately to steeply, and can extend from 150 m to over 2,000 m.

The principal sulphide minerals are pyrrhotite, chalcopyrite, and pentlandite which occur in massive, semi-massive, and disseminated form. Pyrite occurs as localized overgrowth. Magnetite occurs as rounded inclusions in massive sulphides and as later overgrowths.

Selebi Mines Mineral Resource Estimate, June 30, 2024:

The key assumptions, parameters, and methods used to estimate the mineral resources are contained in the Selebi TRS. Readers are cautioned not to assume that all or any part of Indicated Mineral Resources will ever be converted into Mineral Reserves as defined by S-K 1300. Readers are cautioned not to assume that all or any part of an Inferred Mineral Resource exists or is economically or legally mineable, or that an Inferred Mineral Resource will ever be upgraded to a higher category.

Exploration

Exploration work completed at the Selebi Mines from 2021 through to the date of this Report consisted of the sourcing and digitization of existing historical information, confirming collar and down hole location information of selected historical holes, and drilling. PREM also completed gyro, BHEM, televiewer, and downhole physical property surveys on selected high priority historical and recent exploration holes. A focused structural model over a portion of the Selebi deposit was developed by SRK Consulting Ltd. (“SRK”), and a 3D model of mineralization for use in targeting was created at Selebi North by SLR.

Selebi North

In August 2023, an underground resource and exploration drilling program at Selebi North was initiated, which continued throughout 2024 and into 2025. During 2024 and up to the filing of this Report, the Company has drilled approximately 45,827 metres in 87 holes, bringing the SNUG drilling program total to 63,947 metres in 162 holes. Assays for a total of 33,963 metres across 80 completed holes have not been accounted for in the Initial Selebi MRE. The program is a combination of infill and exploration drilling to follow the extension of the mineralization down-dip and down-plunge. The core is sampled and sent to ALS Chemex in Johannesburg for analysis. All holes were surveyed with a gyro instrument and selected holes were surveyed with BHEM. BHEM surveys have been completed in 89 underground holes.

Selebi Main

A total of 748 metres of surface drilling has been completed at Selebi Main in 2024 and to date. Historic hole sd120 was wedged at 500 metres and sd120-W1a was drilled to a length of 1,201 metres. This new hole, sd120-W1a, completed in September 2024, intersected massive sulphides at a distance of 46 metres north-northeast (minegrid) from the historic hole. A second hole, sd102a, was wedged at 491 metres and abandoned at 538 metres.

Further information on assay results can be found in the Selebi TRS and the Company’s news releases, copies of which are available on the Company’s website (https://premiumresources.com/). The Company’s website is not incorporated in this Report. Assay results are publicly released as they are received and confirmed by the Company.

Studies

The historical BCL operations consisted of an integrated mining, concentrating and smelting complex which operated for over 40 years over the Selebi Phikwe project area. The smelter processed Selebi and Phikwe concentrates and toll treated nickel concentrates received from the Nkomati Nickel Mine and the Phoenix Mine. The concentrator plant and smelter were placed on care and maintenance in 2016 and are located adjacent to the Selebi Mines at the historical Phikwe Mine.

PREM intends to use pre-concentration methods to separate the minerals from waste materials to produce a mill feed and flotation to produce a concentrate for commercial sale, or for further refining, and does not plan to restart the existing concentrator or smelter. Concentrate options are being investigated and include a bulk concentrate and separate nickel and copper concentrates. In 2021, PREM carried out due diligence work that included metallurgical sampling and testing. Subsequent metallurgical study programs were carried out by SGS Canada Inc. (“SGS”) in Lakefield, Ontario for separate copper and nickel concentrate production at a conceptual level. In 2024, samples were collected from underground from both Selebi Main and Selebi North with flotation test work and pre-concentration studies ongoing for these samples.

Engineering trade off studies are nearing completion by DRA Global out of Johannesburg. These include alternative mining methods, electrification of the underground mining fleet, refurbishment of historical critical infrastructure, crushed ore conveying versus use of haul trucks, and blasting options.

During the year ended December 31, 2024, the Company incurred $28,017,207 (2023 - $21,469,132) in exploration and evaluation expenditures on the Selebi Mines. The Company incurred $8,735,401 to acquire the Selebi Mines, and has incurred a further $69,296,576 in exploration and evaluation expenditures project-to-date as at December 31, 2024.

Selkirk Mine

The information that follows relating to the Selkirk Mine is derived from, and in some instances is an extract from, the Selkirk TRS. Portions of the following information are based on assumptions, qualifications and procedures which are not fully described herein. Reference should be made to the full text of the Selkirk TRS, which has been included as Exhibit 96.2 to this Report. The Selkirk TRS is incorporated herein by reference and made a part hereof. In the event that we determine that any modifying factors, estimates and other scientific and technical information in the report materially change, we may update or file a new technical report in the future. The Selkirk Mine is an exploration stage property.

Pursuant to Item 1302(b)(5) of Regulation S-K (17 C.F.R. §229.1302(b)(5)), the Company states that the Selkirk TRS was prepared by SLR. The qualified persons of SLR meet the qualifications specified under the definition of “qualified person” under Item 1300 of Regulation S-K.

Property Description and Location

The Selkirk Mine is located in the northeast of Botswana approximately 28 km southeast of the city of Francistown, and 450 km northeast of the national capital Gaborone.

The Selkirk Mine is accessed year-round via paved and gravel roads from Gaborone and Francistown. The Selkirk Mine infrastructure includes relict surface infrastructure supporting the historical underground mine, and the original decline. The Selkirk Mine is quite flat, and beyond the mine footprint is covered in grassland with dispersed and clusters of trees typical of a tree savanna biome.

Land Tenure

The Selkirk Mine consists of a single mining licence covering an area of 1,458 hectares (14.58 km²) and four prospecting licences covering a total of 12,670 hectares (126.7 km²). The mining licence, 2022/7L, is centred approximately at 21°19’13” S and 27°44’17” E and is held by PNGPL, a subsidiary of PREM. The mining licence was renewed for ten years commencing on May 27, 2022, ending on May 26, 2032. The four prospecting licences (PL050/2010, PL051/2010, PL210/2010, and PL071/2011) expired September 30, 2024, and applications for renewal were submitted prior to the expiry date. The Company received verbal confirmation that they were renewed during the first quarter of 2025 and will expire September 30, 2026.

Infrastructure

The area is in a rural district and the available infrastructure is minimal. Strategic services (e.g., electricity and water supplies) could be provided by the Botswana Power Corporation and from existing governmental water pipelines within the Francistown Road Reserve, and potable water could be sourced on site from boreholes. A railway line crosses the western margin of the Selkirk area.

History

Anglo American Corporation of South Africa established the presence of nickel and copper occurrences at the sites of the ancient copper workings in the area in 1929. Significant exploration started in the mid-1960s by the Tati Territory Exploration Company. The first exploration campaigns included soil sampling, trench sampling, ground geophysics, and diamond drilling. At least four exploration and mining companies have worked on the Selkirk Mine since the 1960s and extensive work has been done to characterize the economic potential of the property.

The Selkirk underground mine was operated from 1989 to 2002 by Tati Nickel Mining Company (“TNMC”), a company created specifically to exploit the deposit. More than 1 Mt of material grading 2.6% Ni and 1.6% Cu was extracted from a semi-elliptical deposit of massive sulphide up to 20 m thick. Since 2003, extensive exploration has been completed to characterize the lower-grade/higher-tonnage halo of disseminated sulphides both surrounding and down plunge (south) of the mined-out high-grade mineralization. Exploration and conceptual studies were conducted by Lion Ore Mining Pty Ltd and subsequently by Norilsk Nickel Group of Companies through their ownership in TNMC.

Geological Setting, Mineralization, and Deposit

The Selkirk Mine lies within the Tati granite-greenstone belt of the Zimbabwe Craton. The mineralized body of the Selkirk deposit is hosted within the Selkirk Formation (>1 km thick) which consists mainly of dacitic and rhyolitic volcaniclastic rocks and minor amounts of mafic volcanic rocks, quartzites, and quartz sericite schists. The Selkirk Formation hosts the Phoenix, Selkirk, and Tekwane meta-gabbronoritic intrusions and the Sikukwe meta-peridotite intrusion and the area around the project hosts intrusive magmatic nickel-copper-platinum group element sulphide deposits, namely the Phoenix deposit, as well as the Tekwane and Cinderella exploration prospects.

Two styles of mineralization are found at Selkirk: (1) massive sulphides (mined-out), located within the metagabbro intrusion as well as small, massive sulphide accumulations at the base of the taxitic metagabbro intrusive, and (2) matrix and disseminated sulphides as a halo surrounding and down-dip of the mined-out massive sulphide body. The disseminated zone that once included the mined-out sulphide lens, lies 50 m to 100 m above the basal contact of the footwall quartz diorite and mimics the footwall contact. Currently available drilling suggests that the shallow, previously mined, massive sulphide lens was synformal in shape and measured up to 70 m to 90 m wide, averaged 20 m thick, and had a plunge extent of 200 m.

The disseminated sulphide mineralization surrounding the massive sulphides is also synformal in shape, averages 120 m wide and 100 m to 150 m thick and plunges shallowly to the south at 25°. It is defined from surface over a distance of 900 m and remains open at depth. Mineralization consists of pentlandite, pyrrhotite, chalcopyrite and pyrite. At least three generations of dykes crosscut the mineralized metagabbro. Numerous faults traversing the deposit have been described in surface and underground mapping, none of which present significant displacement at the deposit scale. The Selkirk metagabbro host has been attributed an age of 2.7 Ga.

Selkirk Mine Mineral Resource Estimate, November 1, 2024:

The key assumptions, parameters, and methods used to estimate the mineral resources are contained in the Selkirk TRS. Readers are cautioned not to assume that all or any part of an Inferred Mineral Resource exists or is economically or legally mineable, or that an Inferred Mineral Resource will ever be upgraded to a higher category.

Exploration

Exploration work completed by PREM to date has consisted of the sourcing and digitization of existing historical information, confirming collar location information on selected historical holes, re-logging selected drill core, sampling mineralized drill core found unsampled on surface, sampling underground drifts, and submitting a number of samples for proof-of-concept metallurgical testing. PREM has also initiated an internal study into the feasibility of the open pit concept and is exploring conceptually with limited test information several different processing options.

The Selkirk MRE serves as a solid foundation for advancing the Selkirk deposit to an economic study. It was prepared using results from 232 surface and 10 underground historical drillholes drilled between 2003 and 2016, five 2016 drillholes sampled by PREM in 2021, and 17 historical drillholes resampled in 2024. Analytical results from PREM re-sampling showed higher PGE values compared to historic results and additional resampling is expected to result in higher Pt and Pd grades and contained metal.

Further, the Selkirk MRE was prepared under the conceptual processing scenario of producing two separate concentrates. Additional work on alternate processing options may result in higher recoveries. Cobalt, a potentially valuable by-product, has not been included in the Selkirk MRE as cobalt analyses are not consistently available throughout the deposit. Planned metallurgical studies will determine payability of cobalt at the Selkirk Mine.

Exploration programs have also been ongoing at the prospecting licences located adjacent to the Selkirk mining licence, with a DGPS of seven historical drillhole collars and two surface electromagnetics surveys completed in Q2 2024. The strongest electromagnetic anomaly occurs over the Rooikoppie Prospect, a gossan that was targeted by BCL drill holes. These five holes were located, DGPS coordinates collected, and two holes, DRKP001 and 002, were sampled in Q3 2024. Assays showed no significant results in Ni, Cu, or PGEs.

Studies

PREM intends to use flotation to produce a concentrate for commercial sale or for further refining. Concentrate options are being investigated and include separate nickel and copper concentrates, and a bulk concentrate.

Metallurgical study programs were carried out by SGS in Lakefield for separate copper and nickel concentrate production at a conceptual level. The conceptual process flowsheet developed by SGS includes the key unit operations of crushing, grinding, and flotation. PREM analyzed select SGS test results on key flotation parameters observed in the production of separate nickel and copper concentrates to simulate estimated metal grades and recoveries for bulk concentrate.

The Company is also investigating producing a lower grade nickel concentrate suitable for hydrometallurgical processing. Phase 1 hydrometallurgical test-work using the Platsol process began in late 2023 and was completed in January 2024.

Results from the metallurgical testing showed recoveries of all the payable metals (Ni, Cu, Co, Au, Pt and Pd) to the solution phase were very high (generally >99%) in the initial batch autoclave testing. The downstream processes have been tested at bench scale and, although it is not possible to precisely quantify final metal recoveries to saleable products until continuous, integrated piloting is completed, overall recoveries of all payable metals should be >95% based on commercial experience of base metal hydrometallurgical plants. This study demonstrated that alternate processing options are potentially viable at Selkirk.

The area is in a rural district and the available infrastructure is minimal. Strategic services (e.g., electricity and water supplies) could be provided by the Botswana Power Corporation and from existing governmental water pipelines within the Francistown Road Reserve, and potable water could be sourced on site from boreholes. A railway line crosses the western margin of the Selkirk area.

During the year ended December 31, 2024, the Company incurred $1,477,696 (2023 - $1,233,342) in exploration and evaluation expenditures on the Selkirk Mine. The Company incurred $327,109 to acquire the Selkirk Mine, and has incurred a further $3,058,502 in exploration and evaluation expenditures project-to-date as at December 31, 2024.

Maniitsoq Nickel-Copper-PGM Project, Southwest Greenland

No exploration work was carried out in Greenland in 2024. In early December 2024, the Company notified the Government of Greenland that it was relinquishing its licences effective immediately and is awaiting final approval from authorities.

Canadian Nickel Projects - Sudbury, Ontario

Post Creek Property

The Post Creek property is located 35 kilometres east of Sudbury in Norman, Parkin, Alymer and Rathburn townships and consists of 64 unpatented mining claim cells in two separate blocks, covering a total area of 847 hectares held by the Company. The Company acquired the property through an option agreement in April 2010, which was subsequently amended in March 2013. As at the date of this Report, the Company holds a 100% interest in the Post Creek property and is obligated to pay advances on a net smelter return of $10,000 per annum, which will be deducted from any payments to be made under the net smelter return.

The Post Creek property lies adjacent to the Whistle Offset Dyke Structure which hosts the past–producing Whistle Offset and Podolsky Cu-Ni-PGM mines. Post Creek lies along an interpreted northeast extension of the corridor containing the Whistle Offset Dyke and Footwall deposits and accounts for a significant portion of all ore mined in the Sudbury nickel district and, as such, represents favourable exploration targets. Key lithologies are Quartz Diorite and metabreccia related to offset dykes and Sudbury Breccia associated with Footwall rocks of the Sudbury Igneous Complex which both represent potential controls on mineralization.

No exploration work was completed in 2024 on the Post Creek Property. The claims have sufficient work credits to keep them in good standing until 2027. No material expenditures or activities are contemplated on the Post Creek property at this time.

Halcyon Property

The Halcyon property is located 35 kilometres northeast of Sudbury in the Parkin and Aylmer townships and consists of 62 unpatented mining cells for a total of 1,024 hectares. Halcyon is adjacent to the Post Creek property and is approximately two kilometres north of the producing Podolsky Mine of FNX Mining. The property was acquired through an option agreement and as at the date of this Report, the Company holds a 100% interest in the Halcyon property and is obligated to pay advances on a net smelter return of $8,000 per annum, which will be deducted from any payments to be made under the net smelter return.

No exploration work was completed on the Halcyon Property in 2024. The claims are in good standing through 2027. No material expenditures or activities are contemplated on the Halcyon property at this time.

Quetico Property

The Quetico property is located within the Thunder Bay Mining District of Ontario and consisted of 99 claim cells in two blocks. Cells were acquired to assess: (a) the Quetico Sub-province corridor, which hosts intrusions with Ni-Cu-Co-PGM mineralization related to a late 2690 Ma Archean magmatic event; and (b) the Neoproterozoic (1100 Ma MCR) magmatic event and related intrusions.

No work was carried out on the Quetico property in 2024. The last remaining claims expired on April 26, 2024.

Internal Controls over the Mineral Resources Estimation Process

The Company uses an industry-standard approach to exploration and mineral resource estimation that results in reasonable and reliable estimates aligned with industry practice and reporting regulations. The Company’s systems cover exploration activities, sample preparation and analysis, mineral processing, metallurgical testing, recovery estimation, and mineral resource estimations. Controls include, but are not limited to, use of certified laboratories, formal quality assurance and quality control (“QA/QC”) protocols, standardized procedures, workflow processes, data verification, supervision and management approval, internal and external reviews, and data security covering record keeping, chain of custody and data storage.

QA/QC protocols over sampling and assaying of drill hole samples encompass the insertion of blind reference material samples including certified reference materials (CRM) and blanks, as well as coarse reject duplicate samples in the primary sample streams. Selective pulp samples are analyzed at a secondary laboratory. All results are reviewed upon receipt and actioned according to predefined failure criteria. Internal reports are prepared to monitor performance and trends over longer periods.

Data is maintained in an industry standard data management software with regular backups and internal controls. Prior to use in mineral resource estimation, a third-party check verifies the drill hole database against laboratory sourced analytical certificates and validates the data through several standard and specific tests, including review of QA/QC results.

The mineral resource estimate is prepared by a third party whose standard workflow includes rigorous internal peer and senior review processes that consider the suitability of technical and economic inputs and assumptions, the geological framework, mineralizing system, and interpolation and classification approaches and execution. Results are reviewed internally by Company management.

Item 3. LEGAL PROCEEDINGS.

We have no knowledge of any material, active, pending or threatened legal, administrative or judicial proceeding against us or our subsidiaries, nor are we, or any subsidiary, involved as a plaintiff or defendant in any material proceeding or pending litigation.

Item 4. MINE SAFETY DISCLOSURES.

Not applicable.

Part II

Item 5. MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES.

Market Information

The Common Shares are listed and posted for trading on the TSXV under the symbol “PREM”. In addition, the Common Shares are currently quoted on the OTC Pink Open Market under the symbol “PRMLF”.

Holders

As of March 18, 2025, there were 529 holders of record of Common Shares, based on information provided by the Company’s transfer agent and the recently announced financing transaction (see “Liquidity & Capital Resources – Financings”). This figure does not reflect the beneficial ownership of shares held in nominee name. The holders of Common Shares are entitled to one vote for each share held of record on all matters submitted to a vote of shareholders. Holders of Common Shares have no pre-emptive rights and no right to convert their Common Shares into any other securities. There are no redemption or sinking fund provisions applicable to the Common Shares.

Dividends

We have not paid, and do not in the foreseeable future intend to pay, any dividends on the Common Shares. The declaration and payment of future dividends to holders of our Common Shares will be at the discretion of the Board of Directors and will depend upon many factors, including our financial condition, earnings, legal requirements, restrictions in our debt agreements and other factors deemed relevant by the Board of Directors.

Recent Sales of Unregistered Securities

The following table outlines the number of Common Shares and securities that are convertible into Common Shares issued by the Company during the three months ended December 31, 2024.

Convertible Securities

Purchases of Equity Securities by the Issuer and Affiliated Purchasers

There was no repurchase activity by the Company in respect of Common Shares during the year ended December 31, 2024.

Certain Canadian Federal Income Tax Considerations for U.S. Residents  

The following general summary describes the principal Canadian federal income tax considerations under the Income Tax Act (Canada) (the “Tax Act”) generally applicable to a holder who is a beneficial owner of our Common Shares and who, at all relevant times, (i) is not, and is not deemed to be, resident in Canada for purposes of the Tax Act and any applicable income tax treaty or convention, (ii) is resident in the United States for purposes of the Treaty (as defined below) and is fully entitled to all benefits of the Treaty, (iii) deals at arm’s length with us, and is not affiliated with us, for purposes of the Tax Act, (iv) holds our Common Shares as capital property for purposes of the Tax Act, and (v) does not use or hold, and is not deemed to use or hold, our Common Shares in the course of carrying on, or otherwise in connection with, a business in Canada for purposes of the Tax Act (a “U.S. Resident Holder”). Special rules, which are not discussed in this summary, may apply to a U.S. Resident Holder that is an insurer carrying on an insurance business in Canada and elsewhere or an “authorized foreign bank” (as defined in the Tax Act). Generally, our Common Shares will be considered to be capital property to a holder provided that the holder does not use or hold such shares in the course of carrying on a business of trading or dealing in securities and such holder has not acquired them or been deemed to have acquired them in one or more transactions considered to be an adventure or concern in the nature of trade.

This summary is based upon the current provisions of the Tax Act and the regulations thereunder (the “Regulations”) in force as of the date hereof, our understanding of the administrative policies and assessing practices of the Canada Revenue Agency (the “CRA”) published in writing by the CRA prior to the date hereof, and the Canada-United States Tax Convention (1980) as amended by the Protocols thereto prior to the date hereof (the “Treaty”). This summary also takes into account all specific proposals to amend the Tax Act and the Regulations publicly announced by or on behalf of the Minister of Finance (Canada) prior to the date hereof (the “Tax Proposals”) and assumes that all such Tax Proposals will be enacted in their present form. However, no assurances can be given that the Tax Proposals will be enacted in the form proposed, or at all. This summary is not exhaustive of all possible Canadian federal income tax consequences applicable to a holder of our Common Shares and, except for the foregoing, this summary does not take into account or anticipate any changes in law, whether by legislative, administrative or judicial decision or action, nor does it take into account provincial, territorial or foreign income tax legislation or considerations, which may differ from the Canadian federal income tax consequences described herein.

This summary is of a general nature only and is not intended to be, and should not be construed to be, legal, business or tax advice to any particular holder or prospective holder of our Common Shares, and no opinion or representation with respect to the tax consequences to any holder or prospective holder of our Common Shares is made. Accordingly, holders and prospective holders of our Common Shares should consult their own tax advisors with respect to the income tax consequences of purchasing, owning and disposing of our Common Shares in their particular circumstances.

Currency

For the purposes of the Tax Act, all amounts relating to the acquisition, holding or disposition of our Common Shares (including dividends, adjusted cost base and proceeds of disposition) must be expressed in Canadian dollars based on the rate quoted by the Bank of Canada for the applicable day or such other rate of exchange that is acceptable to the CRA.

Dividends

Dividends paid or credited, or deemed to be paid or credited, on our Common Shares to a U.S. Resident Holder will be subject to Canadian withholding tax. Under the Tax Act, the rate of Canadian withholding tax is 25% of the gross amount of such dividends, which rate is subject to reduction under the Treaty. Under the Treaty, the rate of Canadian withholding tax on dividends paid or credited, or deemed to be paid or credited, on our Common Shares to a U.S. Resident Holder who is the beneficial owner of the dividends is reduced to 15% or, in the case of a U.S. Resident Holder that is the beneficial owner of the dividends and is a corporation that beneficially owns at least 10% of our voting shares, the rate is reduced to 5%. U.S. Resident Holders who may be eligible for a reduced rate of withholding tax on dividends pursuant to the Treaty should consult with their own tax advisors with respect to taking all appropriate steps in this regard.

Disposition of Common Shares

A U.S. Resident Holder generally will not be subject to tax under the Tax Act in respect of any capital gain realized on a disposition or deemed disposition of a Common Share unless the Common Share constitutes (or is deemed to constitute) “taxable Canadian property” (as defined in the Tax Act) of the U.S. Resident Holder at the time of disposition and the U.S. Resident Holder is not entitled to relief under the Treaty.

Generally, a Common Share will not constitute “taxable Canadian property” of a U.S. Resident Holder at a particular time provided that the Common Share is listed on a “designated stock exchange” (as defined in the Tax Act, which currently includes Tiers 1 and 2 of the TSXV) at that time, unless, at any time during the 60-month period that ends at that time, both: (i) one or any combination of (a) the U.S. Resident Holder, (b) persons with whom the U.S. Resident Holder did not deal at arm’s length for purposes of the Tax Act and (c) partnerships in which the U.S. Resident Holder or a person described in (b) holds a membership interest (directly or indirectly through one or more partnerships), own 25% or more of the issued shares of any class or series of our Company, and (ii) more than 50% of the fair market value of the Common Share was derived directly or indirectly from one or any combination of: (a) real or immovable property situated in Canada, (b) “timber resource properties” (as defined in the Tax Act), (c) “Canadian resource properties” (as defined in the Tax Act) or (d) options in respect of, or interests in, or for civil law rights in, any of the foregoing, whether or not the property exists. If the Common Shares are not listed on any designated stock exchange, the Common Shares would generally be “taxable Canadian property” of a U.S. Resident Holder at any time if, at any particular time during the 60-month period that ends at that time, the condition described in (ii) above is met. Notwithstanding the foregoing, in certain circumstances set out in the Tax Act, a Common Share may be deemed to be “taxable Canadian property”.

In the case of a U.S. Resident Holder for whom our Common Shares constitute “taxable Canadian property”, no Canadian taxes will generally be payable on a capital gain realized on the disposition or deemed disposition of such shares by reason of the Treaty, unless the value of such shares is derived principally from “real property situated in Canada” for purposes of the Treaty at the time of the disposition. U.S. Resident Holders for whom Common Shares may constitute “taxable Canadian property” should consult their own tax advisor as to the Canadian federal income tax consequences of the disposition, including potential compliance requirements and withholding under Section 116 of the Tax Act.

Item 6. [RESERVED].

Item 7. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS.

The following management’s discussion and analysis (this “MD&A”) of our financial condition and results of operations should be read in conjunction with the audited consolidated financial statements and accompanying notes thereto for the fiscal years ended December 31, 2024 and 2023 (the “Annual Financial Statements”) appearing elsewhere in this Report. This discussion and analysis below includes forward-looking statements that are subject to risks, uncertainties and other factors described in the “Risk Factors” section that could cause actual results to differ materially from those anticipated in these forward-looking statements as a result of various factors. Additionally, our historical results are not necessarily indicative of the results that may be expected for any period in the future. We caution you to read the “Cautionary Note Regarding Forward-Looking Statements” section of this Report.

This MD&A is intended to assist the reader to assess material changes in the financial condition of the Company during the year ended December 31, 2024, and the results of operations of the Company for the twelve-month periods ended December 31, 2024 and December 31, 2023. The Annual Financial Statements and the financial information contained in this MD&A were prepared in accordance with US GAAP and pursuant to the rules and regulations of the U.S. Securities and Exchange Commission.

In this MD&A, unless the context otherwise requires, references to the Company or PREM refer to Premium Resources Ltd. and its consolidated subsidiaries. All monetary amounts in the discussion are expressed in Canadian dollars unless otherwise indicated.

This MD&A contains forward-looking information within the meaning of applicable securities laws. All forward-looking information, including information not specifically identified herein, is made subject to cautionary language in this MD&A. Readers are cautioned to refer to the disclosure in this Report under the heading “Cautionary Note Regarding Forward-Looking Statements” when reading any forward-looking information.

Selected Financial Information and Financial Position

The following amounts are derived from the Company’s consolidated financial statements prepared under US GAAP.

Net Loss

The net loss of $42,420,283 for the year ended December 31, 2024, was higher by $10,044,214 compared to the prior year net loss of $32,376,069, largely due to increased exploration activities of $6,787,620 relating to the Botswana assets, an increase of $2,333,076 in general and administrative expenses related to share-based compensation and the retirement of the Company’s former Chief Executive Officer, and the higher interest expense and accretion on the Term Loan of $1,434,306.

Total Assets

Total assets as at December 31, 2024, decreased by $13,020,736 from the December 31, 2023, balance as a result of lower cash balances in the current period.

Current Liabilities

Current liabilities as at December 31, 2024, decreased by $1,236,107 from December 31, 2023, due to a decrease in lease liabilities resulting from the repayment of principal and interest on the Syringa Lodge and drilling equipment leases.

Overall Performance and Results of Operations

As at the date of this Report, the Company has not earned revenue nor proved the economic viability of its projects. The Company’s expenses are not subject to seasonal fluctuations or general trends other than factors affecting costs such as inflation and input prices. The Company’s expenses and cash requirements will fluctuate from period to period depending on the level of activity at the projects, which may be influenced by the Company’s ability to raise capital to fund these activities. Comparisons of activity made between periods should be viewed with this in mind. The Company’s quarterly results may be affected by many factors such as timing of exploration activity, share-based compensation costs, capital raised, marketing activities and other factors that affect the Company’s exploration and evaluation activities.

The following table summarizes the Company’s Operations for the three-month and twelve-month periods ended December 31, 2024, and December 31, 2023:

Cash Flows

The following table summarizes the Company’s cash flows:

Operating Activities

Net cash used in operating activities for 2024 increased by $8,136,574 compared to 2023 resulting from the ramp-up of drilling, geology, geophysics, mine development, and other activities at the Mines over the year.

Investing Activities

Key investing activities relate to the acquisition of property, plant and equipment. Net cash used in investing activities for 2024 decreased by $4,232,733 compared to 2023. The higher spending in 2023 was related to the acquisition of mobile equipment and the upfront purchase of tools and parts for the three drills which were leased in 2023.

Financing Activities

Net cash provided by financing activities for 2024 decreased by $24,791,702 compared to 2023. During 2023, the Company obtained a Term Loan for gross proceeds of approximately $20.0 million and closed private placements for gross proceeds of approximately $39.8 million, using a portion of those funds to repay a $7.0 million promissory note from Pinnacle Island LP. During 2024, the Company closed private placements for gross proceeds of approximately $27.5 million.

Liquidity & Capital Resources

The Company, being in the exploration and evaluation stage, is subject to risks and challenges similar to companies in a comparable stage of exploration and evaluation. These risks include the challenges of securing adequate capital for exploration and advancement of the Company’s material projects, operational risks inherent in the mining industry, and global economic and metal price volatility, and there is no assurance management will be successful in its endeavors.

The properties in which the Company currently has an interest are in the pre-revenue stage. Operating cash outflows are highly dependent upon the exploration and evaluation programs taking place at that time. As such, the Company is dependent on external financing to fund its activities and the advancement of its projects. In order to carry out the planned project advancement and cover administrative costs, the Company will need to use its existing working capital and raise additional amounts as needed.

As at December 31, 2024, the Company had $6,105,933 in available cash (December 31, 2023 – $19,245,628), with no sources of operating cash flows, and no significant credit lines in place. As at December 31, 2024, the Company had working capital (calculated as total current assets less total current liabilities) of $2,963,061 (December 31, 2023 – $14,787,484). The decrease in working capital is mainly due to lower cash balances in support of exploration and evaluation activities.

Financings

On March 18, 2025, the Company closed a significant refinancing and the deleveraging of its balance sheet with the conversion of the Term Loan into equity (the “Debt Conversion”).

The Company completed a private placement financing issuing 153,333,334 units of the Company at a price of $0.30 per unit for aggregate gross proceeds of approximately $46 million (the “March 2025 Private Placement”). Each unit consists of one Common Share and one-half of one warrant. Each warrant entitles the holder to acquire one additional Common Share at a price of $0.55 per share until March 18, 2028. In addition, the Company issued 4,000,000 Common Shares at an issue price of $0.30 per share to TriView Capital Ltd. for its services as finder.

In accordance with the previously announced debt settlement agreement, the Company has issued to Cymbria an aggregate of 69,607,843 units (“Settlement Units”) at a deemed issue price of $0.30 per unit in full satisfaction of the $20,882,353 principal amount outstanding under the Term Loan, and the settlement of the $268,896 accrued interest in cash. Each Settlement Unit consists of one Common Share and one Common Share purchase warrant (each, a “Settlement Warrant”). Each Settlement Warrant entitles the holder to acquire one additional Common Share at a price of $0.40 per Common Share until March 18, 2028.

The Company also entered into advisory services agreements which include assistance with the identification of a new CEO, the Debt Conversion, and Company strategy. The advisors will continue to provide such services on an ongoing basis until June 30, 2025. The Company issued 12,750,000 Common Shares to the advisors at a deemed price per share of $0.30 as consideration for their services. The shares remain subject to contractual resale restrictions for a 12-month period. The Company also paid its financial advisor a fee of US$1,500,000, consisting of US$500,000 in cash and US$1,000,000 in 3,586,709 Common Shares issued at a price of US$0.28 per share.

The Company also granted: (i) 5,750,000 stock options with each option having an exercise price of $0.50, a term of five years, and vesting as to one-half on the date of grant and the balance on the first anniversary of the date of grant; and (ii) 3,175,000 RSUs, each RSU vesting in full on the first anniversary of the date of grant. 

Subject to any changes in the Company’s operational plan, this transaction will provide the Company with the funds required to advance its planned activities and cover administrative costs through to the end of 2025.

On June 14, 2024, the Company closed the first tranche of the June 2024 Financing, pursuant to which the Company issued an aggregate 19,234,614 Units at a price of $0.78 per Unit (the “Issue Price”) for aggregate gross proceeds of $15,002,999. Each Unit is comprised of one Common Share and one common share purchase warrant of the Company (each, a “Warrant”). Each Warrant entitles the holder thereof to acquire one Common Share for a period expiring 60 months following the date of issuance (the “Expiry Date”) at a price of $1.10 per Common Share. If, at any time prior to the Expiry Date, the volume-weighted average trading price of the Common Shares is at least $2.00 per Common Share for a period of 20 trading days, the Company may, at its option, accelerate the Expiry Date within 30 days’ notice to the Warrant holders.

On June 21, 2024, the Company closed the second tranche of the June 2024 Financing and issued an additional 16,021,795 Units at the Issue Price for gross proceeds of $12,497,000. Together with proceeds from the first tranche, the total size of the June 2024 Financing was approximately $27.5 million. As at December 31, 2024, the Company has expended $21,178,020 of the June 2024 Financing.

On December 14, 2023, the Company closed a financing (the “December 2023 Financing”) comprised of a brokered private placement of units (the “December 2023 Private Placement”) and an amended Term Loan. Under the December 2023 Private Placement, the Company issued an aggregate of 13,133,367 Common Shares at a price of $1.20 per Common Share for aggregate gross proceeds of $15,760,040. The principal amount of the Term Loan was increased by $5,882,353 (the “Additional Principal Amount”) from $15,000,000 to $20,882,353. The Additional Principal Amount was subject to an original issue discount of approximately 15% and was advanced by Cymbria to the Company as a single advance of $5,000,000. The net proceeds from the December 2023 Financing were $19,743,845 after fees and expenses, which have been used to advance the exploration and evaluation of the Mines and for general corporate and working capital purposes. As at December 31, 2024, all of the net proceeds of the December 2023 Financing had been expended as planned.

Although the Company has been successful in its past fundraising activities, there is no assurance as to the success of future fundraising efforts or as to the sufficiency of funds raised in the future. Factors that could affect the availability of financing include the progress and results of ongoing exploration and evaluation activities at the Mines, the state of international debt and equity markets, as may be impacted by inflation and investor perceptions and expectations with respect to global commodity markets. If necessary, depending on the amount of funding raised, the Company may explore opportunities to defer the timing of certain discretionary expenditures and the Company’s planned initiatives and other work programs may be postponed, or otherwise revised.

Use of Proceeds

The following table provides a summary of the principal use of proceeds of the June 2024 Financing and the December 2023 Financing.

Notes:

Going Concern

The ability of the Company to continue operations as a going concern is ultimately dependent upon achieving profitable operations and its ability to obtain adequate financing. The Company incurred a net loss of $42,420,283 for the year ended December 31, 2024 (December 31, 2023 - $32,376,069). To date, the Company has not generated profitable operations from its resource activities. It is not possible to predict whether future financing efforts will be successful or if the Company will attain a profitable level of operations. These material uncertainties cast substantial doubt about the Company’s ability to continue as a going concern. The accompanying Annual Financial Statements do not include any adjustments relating to the recoverability and classification of recorded asset amounts and classification of liabilities, and the reported expenses and comprehensive loss that might be necessary should the Company be unable to continue as a going concern. These adjustments could be material. In assessing whether a going concern assumption is appropriate, management considers all available information about the future, which is at least, but not limited to, twelve months from the date of this Report.

Contractual Obligations and Contingencies

As of December 31, 2024, the Company had no material commitments for capital expenditures over the next 12 months, however the Company had the following contractual obligations and commitments:

Selebi Mines

As per the Selebi APA, the aggregate purchase price payable to the seller for the Selebi Mines is the sum of US$56,750,000 which amount shall be paid in three instalments:

As per the terms and conditions of the Selebi APA, the Company has the option to cancel the second and third payments and return the Selebi Mines to the BCL Liquidator if the Company determines that the Selebi Mines are not economical. The Company also has an option to pay in advance the second and third payments if the Company determines that the Selebi Mines are economical. The Company’s accounting policy is to measure and record contingent consideration when the conditions associated with the contingency are met. As of December 31, 2024, none of the conditions of the second and third instalments have been met, hence these amounts are not accrued in the Financial Statements.

In addition to the Selebi APA, the purchase of the Selebi Mines is also subject to a royalty agreement as well as a contingent consideration agreement with the BCL Liquidator. The royalty agreement consists of a net smelter royalty (“NSR”) of 2% on the net value of sales of concentrate or other materials with respect to production from the Selebi mining licence, of which the Company has the right to buy-back 50%. The contingent consideration agreement consists of two components: (i) a sliding scale payment of US$0.50/tonne of ore up to US$1.40/tonne of ore with respect to the discovery of new mineable deposits greater than 25 million tonnes of ore and; (ii) price participation of 15% on post-tax net earnings directly attributable to an increase of 25% or more in commodity prices, on a quarterly basis, for a period of seven years from the date of first shipment of concentrate or other materials.

Both the Selebi Mines and Selkirk Mine are subject to a royalty payable to the Botswana Government of 5% of all precious metals sales and 3% of all base metals sales.

Phikwe South and the Southeast Extension

In August 2023, the Company announced that it had entered into a binding commitment letter with the BCL Liquidator to acquire a 100% interest in two additional deposits, Phikwe South and the Southeast Extension, located adjacent to and immediately north of the Selebi North historical workings. The acquisition of the Phikwe South and the Southeast Extension deposits is subject to customary closing conditions and has not yet closed as of March 19, 2025.

The upfront cost to the Company to acquire these additional mineral properties is US$1,000,000. In addition, the Company has agreed to additional work commitments of US$5,000,000 in the aggregate over four years. As a result of the extension of the Selebi mining licence, the remaining asset purchase obligations of the Company outlined in the Selebi APA will each increase by 10%, US$5,500,000 in total, while the trigger events remain unchanged. The existing 2% NSR and contingent consideration agreement held by the BCL Liquidator with respect to production from the Selebi mining licence will also apply to production from these additional deposits, subject to the Company’s existing buy-back right for 50% of the NSR.

Selkirk Mine

In regard to the Selkirk Mine, the purchase agreement does not provide for a purchase price or initial payment for the purchase of the assets. The Selkirk purchase agreement provides that if the Company elects to develop Selkirk first, the payment of the second Selebi instalment of US$25 million would be due upon the approval by the Minister of MMRGTES of the Company’s Section 42 and Section 43 applications (for the further extension of the Selkirk mining licence and conversion of the Selkirk mining licence into an operating licence, respectively). For the third Selebi instalment of US$30 million, if Selkirk were commissioned earlier than Selebi, the payment would trigger on Selkirk’s commission date.

In addition to the Selkirk APA, the purchase of the Selkirk Mine is also subject to a royalty agreement as well as a contingent consideration agreement with the liquidator. The royalty agreement consists of an NSR of 1% on the net value of sales of concentrate or other materials with respect to production from the Selkirk mining licence, of which the Company has the right to buy-back in full. The contingent consideration agreement is on similar terms as the Selebi Mines contingent consideration.

NSR Option

The Company received $2,750,000 (the “Option Payment”) from Cymbria for their right to participate in the Company’s right to repurchase one-half of the Selebi NSR and the entirety of the Selkirk NSR. Cymbria has the right to put its options back to the Company in certain circumstances in return for the reimbursement of the applicable portion of the Option Payment. Cymbria also has the right to compel the Company to repurchase the applicable portion of its NSR from the relevant liquidator.

Term Loan

The Company had an outstanding Term Loan at December 31, 2024, in the amount of $20,882,353 that bore interest at a rate of 10% per annum payable quarterly in arrears, with the principal maturing on June 28, 2026. The Term Loan was subject to certain covenants and provisions on events of default, repayments and mandatory prepayments, including: (i) increase in the interest rate payable on the Term Loan to 15% per annum upon the occurrence of an event of default; (ii) the Company could prepay all or any portion of the principal amount outstanding with a minimum repayment amount of $500,000 and in an integral multiple of $100,000, together with all accrued and unpaid interest on the principal amount being repaid; and (iii) mandatory prepayment was to be made when the Company had non-ordinary course asset sales or other dispositions of property or the Company received cash from the issuance of indebtedness for borrowed money. As at December 31, 2024, the Company was in compliance with the Term Loan covenants.

In March 2025, the Company closed a significant refinancing and the deleveraging of its balance sheet with the conversion of the Term Loan into equity.

While the Company has arranged this additional financing, the proceeds are intended for the advancement of exploration and evaluation activities at the Mines. Therefore, the Company will need to arrange additional financing to meet its commitments under the asset purchase agreements.

Contingencies

There are no environmental liabilities associated with the Mines as at the acquisition dates as all liabilities incurred prior to the acquisitions are the responsibility of the sellers, BCL and TNMC. The Company has an obligation for the rehabilitation costs arising subsequent to the acquisitions. As of December 31, 2024, there were no material rehabilitation costs for which the Company expects to incur, and management is not aware of or anticipating any contingent liabilities that could impact the financial position or performance of the Company related to its exploration and evaluation assets.

The Company’s exploration and evaluation assets are affected by the laws and environmental regulations that exist in the various jurisdictions in which the Company operates. It is not possible to estimate any future contingent liabilities and the impact on the Company’s operating results due to future changes in the Company’s re-development of its projects or future changes in such laws and environmental regulations.

Related Party Transactions

Related party transactions are summarized below and include transactions with the following individuals or entities:

Key management (defined as members of the Board of Directors and certain senior officers) compensation was related to the following:

As a result of the 2023 financing transactions on June 28, 2023, and December 14, 2023, Cymbria and certain other funds managed by EdgePoint (the “Financing Parties”) acquired a total of 16,037,800 Common Shares. The Financing Parties also acquired on closing of the 2023 financing transactions an aggregate of 6,024,000 warrants with an expiration date of June 28, 2026, and an exercise price of $1.4375. Further, in connection with the June 2024 Financing, EdgePoint subscribed for 7,692,307 Units at $0.78 per Unit for gross proceeds of approximately $6.0 million.

As of December 31, 2024, EdgePoint beneficially owns 23,833,224 Common Shares and 13,716,307 Warrants, representing approximately 12.8% of the issued and outstanding Common Shares (approximately 18.8% on a partially-diluted basis assuming the exercise of all warrants held by EdgePoint). All warrants issued to EdgePoint as part of the June 2024 Financing include customary restrictions providing that EdgePoint will not exercise such number of warrants so as to bring its undiluted share ownership percentage above 20.0% of the Company’s issued and outstanding Common Shares without obtaining the requisite shareholder and Exchange approval.

In connection with the June 2024 Financing, certain insiders of the Company subscribed for an aggregate of 1,389,140 Units for gross proceeds of $1,083,529.

For the year ended December 31, 2024, the Company paid interest of $2,082,830 (2023 - $793,392) to the Financing Parties.

Segmented Disclosure

The Company operates in one reportable operating segment being that of the acquisition, exploration and evaluation of mineral properties in three geographic segments being Canada, Barbados, and Botswana. The Company’s geographic segments are as follows:

The Company’s exploration and evaluation activities are assessed at the individual project level. The Selebi and Selkirk projects below make up the Botswana geographic segment.