Form 20F-2020 Annual Report (AIF)
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UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 20-F ☐ REGISTRATION STATEMENT PURSUANT TO SECTION 12(b) OR (g) OF THE SECURITIES EXCHANGE ACT OF 1934. OR ☒ ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the fiscal year ended December 31, 2020 OR ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from _____________to _____________ OR ☐ SHELL COMPANY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 Commission file number: 000-55985 SILVER ELEPHANT MINING CORP. (Exact name of Registrant as specified in its charter) British Columbia, Canada (Jurisdiction of incorporation or organization) Suite 1610 - 409 Granville Street Vancouver, British Columbia, Canada V6C 1T2 (Address of principal executive offices) John Lee Suite 1610 - 409 Granville Street Vancouver, British Columbia, Canada V6C 1T2 Telephone: 604-569-3661, Facsimile: 604-569-3617 Email: [email protected] (Name, Telephone, E-Mail and/or Facsimile number and Address of Company Contact Person) Copy of communications to: James Guttman Dorsey & Whitney LLP Brookfield Place 161 Bay Street, Suite 4310 Toronto, Ontario, Canada M5J 2S1 Telephone: (416) 367-7376 Facsimile: (416) 367-7371 Securities registered or to be registered pursuant to Section 12 (b) of the Act: None Securities registered or to be registered pursuant to Section 12 (g) of the Act. Common Shares without par value (Title of Class) Securities for which there is a reporting obligation pursuant to Section 15(d) of the Act: None Indicate the number of outstanding shares of each of the issuer’s classes of capital or common stock as of the close of the period covered by the annual report: 180,518,828 Common Shares as at December 31, 2020 Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. Yes ☐ No ☒ If this report is an annual or transition report, indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 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 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 and posted 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 and post such files). Yes ☒ No ☐ Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or an emerging growth company. See the definition of “large accelerated filer,” “accelerated filer,” and “emerging growth company” in Rule 12b-2 of the Exchange Act. Non-accelerated filer ☒ Large accelerated filer ☐ Accelerated filer ☐ Emerging growth company ☒ If an emerging growth company that prepares its financial statements in accordance with U.S. GAAP, 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. ☐ Indicate by check mark which basis of accounting the registrant has used to prepare the financial statements included in this filing: ☒ ☐ U.S. GAAP ☐ International Financial Reporting Standards as issued By the International Accounting Standards Board Other If “Other” has been checked in response to previous question, indicate by check mark which financial statement item the registrant has elected to follow. Item 17 ☐ Item 18 ☐ If this is an annual report, indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). ☐ ☒ Yes No TABLE OF CONTENTS Page 8 ITEM 1. IDENTITY OF DIRECTORS, SENIOR MANAGEMENT AND ADVISERS 8 ITEM 2. OFFER STATISTICS AND EXPECTED TIMETABLE 8 ITEM 3. KEY INFORMATION 8 A. Selected Financial Data 8 B. Capitalization and Indebtedness 8 C. Reasons for the Offer and Use of Proceeds 8 D. Risk Factors 8 ITEM 4. INFORMATION ON THE COMPANY 15 A. History and Development of the Company 15 B. Business Overview 21 C. Organizational Structure 22 D. Property, Plants and Equipment 23 ITEM 4A UNRESOLVED STAFF COMMENTS 60 ITEM 5. OPERATING AND FINANCIAL REVIEW AND PROSPECTS 60 A. Operating Results 60 B. Liquidity and Capital Resources 62 C. Research and Development, Patents and Licenses, etc. 64 D. Trend Information 64 E. Off-Balance Sheet Arrangements 64 F. Tabular Disclosure of Contractual Obligations 64 G. Safe Harbor 64 ITEM 6. DIRECTORS, SENIOR MANAGEMENT AND EMPLOYEES 65 A. Directors and Senior Management 65 B. Compensation 67 C. Board Practices Overview 69 D. Employees 70 E. Share Ownership 70 ITEM 7. MAJOR SHAREHOLDERS AND RELATED PARTY TRANSACTIONS 71 A. Major Shareholders 71 B. Related Party Transactions 71 C. Interests of Experts and Counsel 72 ITEM 8. FINANCIAL INFORMATION 72 A. Consolidated Statements and Other Financial Information 72 B. Significant Changes 73 ITEM 9. THE OFFER AND LISTING 73 A. Offer and Listing Details 73 B. Plan of Distribution 73 C. Markets 73 D. Selling Shareholders 73 E. Dilution 73 F. Expenses of the Issue 73 ITEM 10. ADDITIONAL INFORMATION 73 A. Share Capital 73 B. Memorandum and Articles of Association 73 C. Material Contracts 75 D. Exchange Controls 75 E. Taxation 75 F. Scope of this Summary 75 G. Dividends and Paying Agents 78 H. Statement by Experts 78 I. Documents on Display 78 J. Subsidiary Information 79 ITEM 11. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK 79 ITEM 12. DESCRIPTION OF SECURITIES OTHER THAN EQUITY SECURITIES 79 A. A.-C. 79 D. American Depository Receipts 79 79 ITEM 13. DEFAULTS, DIVIDEND ARREARAGES AND DELINQUENCIES 79 ITEM 14. MATERIAL MODIFICATIONS TO THE RIGHTS OF SECURITY HOLDERS AND USE OF PROCEEDS 79 3 ITEM 15. CONTROLS AND PROCEDURES 79 A. Disclosure Controls and Procedures 79 B. Management’s Annual Report on Internal Control Over Financial Reporting 79 C. Attestation Report of the Registered Public Accounting Firm 80 D. Changes in Internal Control Over Financial Reporting 80 ITEM 16. [RESERVED] 80 ITEM 16A AUDIT COMMITTEE FINANCIAL EXPERT 80 ITEM 16B CODE OF ETHICS 80 ITEM 16C PRINCIPAL ACCOUNTANT FEES AND SERVICES 80 ITEM 16D EXEMPTIONS FROM THE LISTING STANDARDS FOR AUDIT COMMITTEES 80 ITEM 16E PURCHASES OF EQUITY SECURITIES BY THE ISSUER AND AFFILIATED PURCHASERS 80 ITEM 16F CHANGE IN REGISTRANT’S CERTIFYING ACCOUNTANT 80 ITEM 16G CORPORATE GOVERNANCE 80 ITEM 16H MINE SAFETY DISCLOSURE 80 81 ITEM 17. FINANCIAL STATEMENTS 81 ITEM 18. FINANCIAL STATEMENTS 81 ITEM 19. EXHIBITS 81 4 INTRODUCTORY NOTES GENERAL INFORMATION In this annual report on Form 20-F (the “Annual Report”), the terms “we”, “our”, “us”, the “Company” refer, unless the context requires otherwise, to Silver Elephant Mining Corp. and its subsidiaries. References herein to "Common Shares" are references to the Common Shares without par value of the Company. PRESENTATION OF FINANCIAL AND OTHER DATA We prepare our audited consolidated financial statements in accordance with International Financial Reporting Standards, or “IFRS”, as issued by the International Accounting Standards Board, or the “IASB”. The financial information and related discussion and analysis contained in this annual report on Form 20-F are presented in Canadian dollars, unless stated otherwise. The financial information analysis in this annual report on Form 20-F is based on our consolidated financial statements as of December 31, 2020, 2019 and 2018, included elsewhere in this document. Percentages and some amounts in this annual report on Form 20-F have been rounded for ease of presentation. Any discrepancies between totals and the sums of the amounts listed are due to rounding. CURRENCY Unless otherwise indicated, all references to “dollars” or “$” are to Canadian dollars and all references to “US dollars,” “USD”, "US$" or "USD$" are to United States of America dollars. SHARE CONSOLIDATIONS AND FORWARD SPLIT 2016 Share Consolidation On June 7, 2016, we completed a consolidation of our issued and outstanding Common Shares on the basis of one post consolidation Common Share, option and warrant, for 100 pre- consolidation Common Shares, options and warrants, as applicable (we refer to this as the "2016 Consolidation"). Forward Split On August 8, 2018, we completed a split of our issued and outstanding Common Shares on the basis of ten post-split Common Shares, options and warrants for 1 pre-split Common Share, option and warrant, as applicable (the "Forward Split"). 2020 Share Consolidation On March 16, 2020, the shareholders approved a consolidation of our issued and outstanding Common Shares on the basis of one (1) new Common Share for every five (5) to ten (10) issued and outstanding Common Shares (we refer to this as the "2020 Consolidation"). The 2020 Consolidation has not yet been effected. All Common Share and "per share" information in this Annual Report have been retroactively adjusted to reflect the Forward Split and the cumulative effect of the 2016 Consolidation and Forward Split, as applicable, for all periods presented, unless otherwise indicated.