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Silver Elephant Mining Corp
Symbol ELEF
Shares Issued 219,559,041
Close 2021-09-23 C$ 0.26
Recent Sedar Documents

Silver Elephant continues Ni, V project spinouts

2021-09-23 13:02 ET - News Release

Mr. John Lee reports

SILVER ELEPHANT PROVIDES UPDATE AND SCHEDULE ON PLAN OF ARRANGEMENT

Silver Elephant Mining Corp. has provided the following update further to its news release dated Aug. 26, 2021, with respect to the company's proposed plan of arrangement to spin out its Manitoba-based Minago nickel project, its Nevada-based Gibellini vanadium project and battery metals royalties into Flying Nickel Mining Corp., Nevada Vanadium Mining Corp. and Battery Metals Royalties Corp. (the SpinCos)

Further to the news release of the company dated Sept. 6, 2021, assuming the full completion of proposed previously announced private placement of common shares of the company for aggregate gross proceeds of up to $3.3-million and that no further securities of Silver Elephant are issued prior to the record date of the arrangement, which is presently expected to be in December, 2021, Silver Elephant will have approximately 235 million common shares and 32 million warrants and options issued and outstanding on the record date.

Subject to applicable laws, the policies of and approval by the Toronto Stock Exchange, the receipt of shareholder approval and court approval, and satisfaction of other closing conditions, it is presently expected that, pursuant to the arrangement:

  1. Each Silver Elephant share outstanding on the record date will be consolidated on the basis of one postconsolidation common share for every 10 preconsolidation shares of Silver Elephant.
  2. Each Silver Elephant shareholder will receive one share of each of Flying Nickel and Nevada Vanadium for every postconsolidation Silver Elephant share by such shareholder on the record date and two shares of Battery Royalties for every postconsolidation Silver Elephant share held by such shareholder on the record date.

Accordingly, upon completion of the arrangement (including the consolidation), there will be approximately:

  1. 23.5 million Silver Elephant shares and 3.2 million warrants and options of Silver Elephant issued and outstanding;
  2. 50 million common shares in the capital of Flying Nickel issued and outstanding;
  3. 50 million common shares in the capital of Nevada Vanadium issued and outstanding;
  4. 80 million common shares in the capital of Battery Royalties issued and outstanding.

Silver Elephant securityholders (common share, option and warrant) on the record date, assuming exercise of all warrants and options of Silver Elephant, will collectively directly hold approximately:

  1. 26.7 million Flying Nickel shares, representing approximately 53.4 per cent of the Flying Nickel shares issued and outstanding;
  2. 26.7 million Nevada Vanadium shares, representing approximately 53.4 per cent of the Nevada Vanadium shares issued and outstanding;
  3. 53.4 million Battery Royalties shares, representing approximately 66.8 per cent of the Battery Royalties shares issued and outstanding.

Any remaining Flying Nickel shares and Nevada Vanadium shares held directly by Silver Elephant (upon completion of the prior distribution to shareholders and reservation of Flying Nickel and Nevada Vanadium shares for distribution upon exercise of warrants and options of Silver Elephant) will be transferred to Battery Royalties as part of the arrangement.

Upon completion of the arrangement, it is currently expected that the company and each SpinCo will focus on its corresponding core business with:

  1. Silver Elephant holding a 100-per-cent interest in its Pulacayo silver and El Triunfo gold-silver projects in Bolivia and approximately 26.6 million (representing 33.2 per cent of) Battery Royalties shares as a long-term investment;
  2. Nevada Vanadium, holding a 100-per-cent interest in its Gibellini vanadium project in Nevada;
  3. Flying Nickel, holding a 100-per-cent interest in its Minago nickel project at the Thompson nickel belt in Manitoba;
  4. Battery Royalties, holding 2-per-cent royalties of each of the assets referenced above and approximately 23.3 million (representing 46.6 per cent of) Flying Nickel shares and 23.3 million (representing 46.6 per cent of) Nevada Vanadium shares as a long-term investment.

While the foregoing has been prepared on the basis that no additional securities of each SpinCo will be issued, it is presently expected that each SpinCo will complete a financing in connection with the arrangement to provide for working capital and other corporate purposes. Further details on SpinCo financings will be provided when available.

John Lee, chairman of Silver Elephant, states: "After the spinout, green energy institutional fund managers, precious metals fund managers and royalty-focused investors will be able to buy nickel, vanadium, silver or royalty company shares of their choice from our plan. We also aim to list Flying Nickel, Nevada Vanadium and Battery Royalties on the TSX Venture Exchange to facilitate trading liquidity and support future business expansion."

There can be no assurance that the arrangement will be completed on the terms described herein or at all or that any of the SpinCos will be listed on any stock exchange. Completion of the arrangement is subject to applicable laws, the policies of and approval by the Toronto Stock Exchange, the receipt of shareholder approval and court approval, and satisfaction of other closing conditions.

Subject to applicable laws, the policies of and approval by the TSX and the receipt of court approval, the company presently expects to call a shareholder meeting to be held in early to mid-December, 2021, to approve the arrangement. Further details regarding the arrangement will be contained in an information circular of the company to be mailed to shareholders in early November.

About Silver Elephant Mining Corp.

Silver Elephant Mining is a premier mining and exploration company in silver, nickel and vanadium.

We seek Safe Harbor.

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