ARRAS MINERALS CORP. (Form: 20FR12G/A, Received: 08/09/2021 17:13:35)

As filed with the Securities and Exchange Commission on August 9, 2021

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

Amendment No. 1

FORM 20-F

☒	REGISTRATION STATEMENT PURSUANT TO SECTION 12(b) OR (g) OF THE SECURITIES EXCHANGE ACT OF 1934

☐	ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the fiscal year ended___________________________________________________________________

☐	TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from ______________________________ to ______________________________

☐	SHELL COMPANY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 Date of event requiring this shell company report _______________________________________________

Commission File Number: __________

Arras Minerals Corp.

(Exact name of registrant as specified in its charter)

N/A

(Translation of Registrant’s name into English)

British Columbia

(Jurisdiction of incorporation or organization)

777 Dunsmuir Street, Suite 1610

Vancouver, British Columbia V7Y 1K4

Canada

(Address of principal executive office)

Timothy T. Barry

President and Chief Executive Officer

777 Dunsmuir Street, Suite 1610

Vancouver, British Columbia V7Y 1K4

Canada

Tel: (604) 687-5800

(Name, Telephone, Email and/or Facsimile number and Address of Company Contact Person)

Copies to:

Brian Boonstra

Davis Graham & Stubbs LLP

1550 Seventeenth Street, Suite 500

Denver, CO 80202

Tel: (303) 892-7348

Securities registered or to be registered pursuant to Section 12(b) of the Act.


Title of each class	Trading Symbol(s)	Name of each exchange on which registered

Securities for which there is a reporting obligation 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. Not applicable.

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 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, or an emerging growth company. See definition of “large accelerated filer,” “accelerated filer,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer ☐

Accelerated filer ☐

Non-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 period for complying with any new or revised financial accounting standards† provided pursuant to Section 13(a) of the Exchange Act. ☐

†	The term “new or revised financial accounting standard” refers to any update issued by the Financial Accounting Standards Board to its Accounting Standards Codification after April 5, 2012.

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 the 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 ☐

, 2021

Dear Shareholders of Silver Bull Resources, Inc.:

On May 25, 2021, Silver Bull Resources, Inc., a Nevada corporation (“Silver Bull”), announced its intention to “spin off” its assets and operations located in Kazakhstan to its shareholders in a new British Columbia incorporated company called Arras Minerals Corp. (“Arras”). Arras is currently a subsidiary of Silver Bull, which holds approximately 88% of the outstanding shares of Arras, with the remaining shares of Arras being held by certain investors following the completion of a private placement of Arras common shares on April 1, 2021. The spin-off will be structured as a pro-rata distribution of shares of Arras to Silver Bull shareholders. Approximately 34.3 million shares of Arras are expected to be distributed, with one Arras share to be distributed to Silver Bull shareholders for each share of Silver Bull common stock held. I am pleased to report that we expect to effect the proposed distribution on or around , 2021. Immediately following the spin-off, Silver Bull will retain an approximately 4% ownership interest, or approximately 1.7 million shares, in Arras.

The spin-off is expected to:

provide investors with the potential for greater value than a single company by unlocking a premium value for the Beskauga and Sierra Mojada projects separately;

create two separate companies that have clear commodity and regional demarcation, allowing for targeted branding and marketing;

allow each company flexibility in allocating resources and deploying capital in a manner consistent with the separate business strategies;

broaden the appeal of the potential investor base for both companies, with Kazakhstan potentially appealing to European and Middle Eastern investors and Mexico potentially appealing to North American investors; and

facilitate the ability of the companies to separately finance the Beskauga and Sierra Mojada projects based on the unique characteristics of each project and jurisdiction.

Completion of the spin-off is subject to a number of conditions and associated risks. In addition, following the spin-off, common shares of Arras will not be listed or posted for trading on any stock exchange or market. We invite you to learn more about Arras and the spin-off by reviewing the enclosed registration statement.

Sincerely,

Timothy T. Barry

Chief Executive Officer of Silver Bull Resources, Inc.

TABLE OF CONTENTS

Page

INTRODUCTION AND USE OF CERTAIN TERMS	1
MARKET INFORMATION	1
CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING STATEMENTS	2
SUMMARY	5
PART I
ITEM 1. IDENTITY OF DIRECTORS, SENIOR MANAGEMENT AND ADVISERS.	18
ITEM 2. OFFER STATISTICS AND EXPECTED TIMETABLE.	18
ITEM 3. KEY INFORMATION.	18
ITEM 4. INFORMATION ON THE COMPANY.	32
ITEM 4A. UNRESOLVED STAFF COMMENTS.	53
ITEM 5. OPERATING AND FINANCIAL REVIEW AND PROSPECTS.	53
ITEM 6. DIRECTORS, SENIOR MANAGEMENT AND EMPLOYEES.	54
ITEM 7. MAJOR SHAREHOLDERS AND RELATED PARTY TRANSACTIONS.	65
ITEM 8. FINANCIAL INFORMATION.	67
ITEM 9. THE OFFER AND LISTING.	67
ITEM 10. ADDITIONAL INFORMATION.	68
ITEM 11. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK.	87
ITEM 12. DESCRIPTION OF SECURITIES OTHER THAN EQUITY SECURITIES.	88
PART II
ITEM 13. DEFAULTS, DIVIDEND ARREARAGES AND DELINQUENCIES.	89
ITEM 14. MATERIAL MODIFICATIONS TO THE RIGHTS OF SECURITY HOLDERS AND USE OF PROCEEDS.	89
ITEM 15. CONTROLS AND PROCEDURES.	89
ITEM 16. [RESERVED].	89
ITEM 16A. AUDIT COMMITTEE AND FINANCIAL EXPERT.	89
ITEM 16B. CODE OF ETHICS.	89
ITEM 16C. PRINCIPAL ACCOUNTANT FEES AND SERVICES.	89
ITEM 16D. EXEMPTIONS FROM THE LISTING STANDARDS FOR AUDIT COMMITTEES.	89
ITEM 16E. PURCHASES OF EQUITY SECURITIES BY THE ISSUER AND AFFILIATED PURCHASERS.	89
ITEM 16F. CHANGE IN REGISTRANT’S CERTIFYING ACCOUNTANT.	89
ITEM 16G. CORPORATE GOVERNANCE.	89
ITEM 16H. MINE SAFETY DISCLOSURE.	89
PART III
ITEM 17. FINANCIAL STATEMENTS.	90
ITEM 18. FINANCIAL STATEMENTS.	90
ITEM 19. EXHIBITS.	90
SIGNATURES	91

INTRODUCTION AND USE OF CERTAIN TERMS

We have prepared this registration statement on Form 20-F (the “Form 20-F”) using a number of conventions, which you should consider when reading the information contained herein. In this Form 20-F, the “Company,” “we,” “us,” “our” and “Arras” shall refer to Arras Minerals Corp. as the context may require. As used in this Form 20-F, the terms “Mineral Resource,” “Measured Mineral Resource,” “Indicated Mineral Resource,” “Measured Mineral Resource,” and “Inferred Mineral Resource” and any grammatical variations thereof are based on the definitions of such terms set forth in Item 1300 of Regulation S-K.

We publish financial statements expressed in U.S. dollars. Our financial statements are prepared in accordance with International Financial Reporting Standards (“IFRS”) as issued by the International Accounting Standards Board (“IASB”).

We have prepared this Form 20-F to register common shares, without par value, of Arras under the Securities Exchange Act of 1934, as amended (the “Exchange Act”), in connection with the proposed distribution of our common shares held by Silver Bull to its shareholders by way of a special dividend, on the basis of one common share of Arras for each share of common stock in the capital of Silver Bull.

MARKET INFORMATION

This Form 20-F contains industry and market data prepared by our management on the basis of such industry sources and our management’s knowledge of and experience in the industry and markets in which we operate (including management’s estimates and assumptions relating to such industry and markets based on that knowledge). Our management has developed its knowledge of such industry and markets through its experience and participation in these markets.

CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING STATEMENTS

This Form 20-F uses certain statements that may be deemed to be “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended (the “Securities Act”), Section 21E of the Exchange Act, and the United States Private Securities Litigation Reform Act of 1995, and “forward-looking information” within the meaning of applicable Canadian securities legislation. We use words such as “anticipate,” “continue,” “likely,” “estimate,” “expect,” “may,” “will,” “projection,” “should,” “believe,” “potential,” “could,” or similar words suggesting future outcomes (including negative and grammatical variations) to identify forward-looking statements. These statements include statements regarding the following, among other things:

the timing, conditions, mechanics, income tax consequences, and other aspects of the proposed distribution of our common shares held by Silver Bull to its shareholders by way of a special dividend;

the sufficiency of our existing cash resources to enable us to continue our operations for the next 12 months as a going concern;

future exploration expenditures on the Beskauga Property, the potential exercise of the Beskauga Option and potential bonus payments under the Beskauga Option Agreement;

the prospects of entering the development or production stage with respect to any of our projects;

our planned activities at the Beskauga Project in 2021 and beyond;

whether any part of the Beskauga Project will ever be confirmed or converted into Regulation S-K 1300-compliant “reserves”;

our ability to obtain and hold additional concessions in the Beskauga Project area;

the timing, duration and overall impact of the novel coronavirus (“COVID-19”) pandemic on the Company’s business;

the sufficiency of our surface rights in respect of the Beskauga Property if a mining operation is determined to be feasible;

the potential acquisition of additional mineral properties or property concessions;

the impact of recent accounting pronouncements on our financial position, results of operations or cash flows and disclosures;

our ability to raise additional capital and/or pursue additional strategic options, and the potential impact on our business, financial condition and results of operations of doing so or not;

the requirement for Arras shareholder approval of the issuance of certain options to purchase Arras common shares; and

the impact of changing foreign currency exchange rates on our financial condition.

These statements are based on certain assumptions and analyses made by us in light of our experience and our perception of historical trends, current conditions, expected future developments and other factors we believe are appropriate in the circumstances. Such statements are subject to a number of assumptions, risks and uncertainties, and our actual results could differ from those expressed or implied in these forward-looking statements as a result of the risk factors discussed in more detail in this Form 20-F under “Item 3. Key Information—Risk Factors,” including without limitation, risks associated with the following:

our ability to continue as a going concern as a single-project company;

the lack of an existing public market for our common shares;

some or all of the expected benefits of the Spin-off may not be achieved;

the Spin-off could result in significant tax liability to certain shareholders;

we are uncertain that we will be able to maintain sufficient cash to accomplish our business objectives;

our exploration activities require significant amounts of capital that may not be recovered;

our ability to meet our current and future capital requirements on favorable terms or at all;

risks relating to the results of future exploration at the Beskauga Property and our ability to raise the capital for exploration expenditures on the Beskauga Property to maintain the effectiveness of the Beskauga Option;

our operations may be disrupted, and our financial results may be adversely affected, by global outbreaks of contagious diseases, including the COVID-19 pandemic;

we are an exploration stage mining company with no history of operations;

we have no commercially mineable ore body;

the reliability of our Mineral Resource estimates;

our ability to acquire additional mineral properties or property concessions;

inherent risks in the mineral exploration industry;

risks relating to fluctuations of metal prices;

risks relating to competition in the mining industry;

risks relating to the title to our properties;

risks relating to our option and joint venture agreements;

risks associated with joint ventures;

our ability to obtain required permits;

timing of receipt and maintenance of government approvals;

compliance with laws is costly and may result in unexpected liabilities;

our success depends on developing and maintaining relationships with local communities and other stakeholders;

risks relating to social and environmental activism;

risks relating to evolving corporate governance and public disclosure regulations;

risks relating to foreign operations;

risks relating to worldwide economic and political events;

risk of political and economic instability in Kazakhstan;

our financial condition could be adversely affected by changes in currency exchange rates;

risks relating our “foreign private issuer” status;

risks relating to our possible status as a passive foreign investment company;

risks relating to volatility in our share value;

further equity financings leading to the dilution of our common shares;

our common shares continuing not to pay dividends;

risks relating to information systems and cybersecurity;

our ability to retain key management, consultants and experts necessary to successfully operate and grow our business;

our overlapping officers and directors with Silver Bull may give rise to conflicts of interest;

our reliance on international advisors and consultants;

risks relating to changes in tax laws; and

risks relating to changes in regulatory frameworks or regulations affecting our activities.

All forward-looking statements speak only as of the date made. All subsequent written and oral forward-looking statements attributable to us, or persons acting on our behalf, are expressly qualified in their entirety by the cautionary statements. Except as required by law, we undertake no obligation to update any forward-looking statement to reflect events or circumstances after the date on which it is made or to reflect the occurrence of anticipated or unanticipated events or circumstances. You should not place undue reliance on these forward-looking statements.

Cautionary Note Regarding Exploration Stage Companies

We are an exploration stage company and do not currently have any known reserves and cannot be expected to have known reserves unless and until a feasibility study is completed for the Beskauga Property concessions that shows proven and probable reserves. There can be no assurance that our concessions contain proven and probable reserves or that even if such reserves are found, that we will be successful in economically recovering them. Investors may lose their entire investment.

SUMMARY

This summary highlights selected information from this Form 20-F and provides an overview of our company, our separation from Silver Bull and the distribution by Silver Bull of our common shares to its shareholders. For a more complete understanding of our business and the Spin-off, you should read this entire Form 20-F carefully, particularly the discussion under “Item 3. Key Information—Risk Factors” and our financial statements and the notes to those financial statements appearing elsewhere in this Form 20-F.

Overview

Arras is an exploration stage company, engaged in the business of mineral exploration. The Company’s exploration is focused on discovering and delineating Mineral Resources at the Company’s material property, the Beskauga Project, which is comprised of three contiguous licenses located in Kazakhstan. We have not realized any revenues. We have not established any reserves with respect to our exploration projects and may never enter into the development stage with respect to any of our projects.

We are currently a subsidiary of Silver Bull, which holds approximately 88% of our outstanding shares, with the remaining shares of Arras being held by certain investors following the completion of a private placement of common shares on April 1, 2021. Immediately following the Spin-off, Silver Bull will retain an approximately 4% ownership interest in Arras. We do not own any interest in another entity, whether wholly or partially.

Reasons for the Spin-off

We and Silver Bull believe that the Spin-off will provide a number of benefits to our business, to the business of Silver Bull and to the shareholders of Silver Bull. As two distinct companies, Silver Bull and Arras will be better positioned to capitalize on significant growth opportunities and focus resources on their respective businesses and strategic priorities. Silver Bull and its board of directors (the “Silver Bull Board”) considered a wide variety of factors in their initial evaluation of the proposed Spin-off, including the following potential benefits:

provide investors with the potential for greater value than a single company by unlocking a premium value for the Beskauga and Sierra Mojada projects separately;

create two separate companies that have clear commodity and regional demarcation, allowing for targeted branding and marketing;

allow each company flexibility in allocating resources and deploying capital in a manner consistent with the separate business strategies;

facilitate the ability of the companies to separately finance the Beskauga and Sierra Mojada projects based on the unique characteristics of each project and jurisdiction.

Neither we nor Silver Bull can assure you that, following the Spin-off, any of the benefits described above or otherwise in this Form 20-F will be realized to the extent or at the time anticipated or at all. See also “Item 3. Key Information—Risk Factors.”

Silver Bull and the Silver Bull Board also considered a number of potentially negative factors in their initial evaluation of the potential Spin-off, including the following:

potential disruption to the businesses of Arras and Silver Bull;

management distraction due to the significant amount of time and effort required to complete the Spin-off;

the significant one-time costs of separating the two companies;

challenges for management of Arras who will continue to have operational responsibilities for Silver Bull;

incremental costs on the resulting companies, including, among others, the costs of being a stand-alone company and potential tax inefficiencies;

greater susceptibility to market fluctuations and other adverse events as a stand-alone company, including as a result of reduced business diversification; and

risk that the Spin-off is not consummated or does not achieve its intended benefits.

Silver Bull and the Silver Bull Board believe that the potential benefits of the Spin-off outweigh these potentially negative factors. The completion of the Spin-off remains subject to the satisfaction, or waiver by the Silver Bull Board, of a number of conditions. We describe these benefits and certain other factors considered by Silver Bull and the Silver Bull Board, as well as conditions to the closing, in greater detail under “Item 4. Information on the Company—The Spin-off.”

Summary of Risks Associated with Our Business and the Spin-off

Our business is subject to numerous risks, including: