FORWARD LOOKING STATEMENTS
The following discussion of our financial condition and results of operations
for the three months ended February 29, 2020 and February 29, 2019 should be
read in conjunction with the consolidated financial statements and the notes to
those statements that are included elsewhere in this report. Our discussion
includes forward-looking statements based upon current expectations that involve
risks and uncertainties, such as our plans, objectives, expectations and
intentions. Actual results and the timing of events could differ materially from
those anticipated in these forward-looking statements because of several
factors, including those set forth under the Part I, Item 1A, Risk Factors and
Business sections in our Annual Report on Form 10-K/A for the fiscal year ended
November 30, 2019, as filed with the SEC on May 13, 2021, this report, and our
other filings with the SEC. We use words such as "anticipate," "estimate,"
"plan," "project," "continuing," "ongoing," "expect," "believe," "intend,"
"may," "will," "should," "could," and similar expressions to identify
forward-looking statements. In addition, any statements that refer to
projections of our future financial performance, our anticipated growth and
trends in our businesses, and other characterizations of future events or
circumstances are forward-looking statements. Such statements are based on our
current expectations and could be affected by the uncertainties and risk factors
described throughout this report.
General Overview
We were incorporated in the State of Nevada on April 29, 2008, under the name
"Mayetok, Inc.". As Mayetok, Inc. we were engaged in the development of a
website to market vacation properties in the Ukraine.
On June 8, 2010, we initiated a one (1) old for 35 new forward stock split of
our issued and outstanding common stock. As a result, our authorized capital
increased from 100,000,000 to 3,500,000,000 shares of common stock and the
issued and outstanding increased from 2,200,000 shares of common stock to
77,000,000 shares of common stock, all with a par value of $0.001.
Also, on June 8, 2010, we changed our name from "Mayetok, Inc." to "First
American Silver Corp.", by way of a merger with our wholly owned subsidiary
First American Silver Corp., which was formed solely for the change of name. We
changed the name of our company to reflect the new direction of our company in
the business of acquiring, exploring and developing mineral properties. As of
June 2010, we had abandoned our former business plan of seeking to market
vacation properties.
Our name change and forward stock split became effective with the
Over-the-Counter Bulletin Board at the opening of trading on June 16, 2010, on
which date we adopted the new stock symbol "FASV".
On June 18, 2018, we changed our name from "First American Silver Corp." to
"Century Cobalt Corp", by way of a merger with our wholly owned subsidiary
Century Cobalt Corp., which was formed solely for the change of name. We changed
the name of our company to reflect the new direction of our company in the
business of acquiring, exploring and developing mineral properties. Our name
change became effective with the Over-the-Counter Bulletin Board at the opening
of trading on June 18, 2018, on which date we adopted the new stock symbol
"CCOB"
Our Current Business
On August 7, 2018, we entered into an assignment agreement with Oriental Rainbow
Group Ltd., in regards to the acquisition of certain mineral claims in Lemhi
County, Idaho known as the "Idaho Cobalt Belt".
Oriental Rainbow and Plateau Ventures LLC had entered into a purchase agreement
dated September 4, 2017, wherein Oriental Rainbow had acquired from Plateau a
100% interest in the property, subject to certain subsequent payments and
conditions. The claims comprising the property (649 claims) initially totaled
approximately 12,980 acres, subject to an option under the purchase agreement
for the acquisition of additional claims. Such option had been exercised with
additional claims acquired, resulting in a total of 695 claims comprising
approximately 13,900 acres.
Oriental Rainbow has assigned its interest in the property to us in
consideration for 2,500,000 restricted shares of common stock (the
"Consideration Shares"). We have assumed all of Oriental Rainbow's obligations
under the purchase agreement, which material obligations include: the issuance
of up to 500,000 restricted shares of common stock to Plateau upon listing on a
recognized stock exchange; paying pending BLM fees for the claims in the amount
of $108,000; and paying Plateau $1,000,000 in four equal staged payments upon
completion of a positive feasibility study on the property.
Century Cobalt's, acreage, known as the "Emperium Cobalt Project," as noted
above totals 12,980 Acres / 5,625 Hectares, making it larger than the combined
land claims of the 5 largest publicly traded companies currently active in the
Idaho Cobalt Belt. The project is located approximately 16 miles (26 km)
southwest of Salmon, Idaho. As of March 2020, the Company's land position has
been reduced to 694 claims.
On March 17, 2021 we executed on an opportunity to expand our asset base and
change our strategic focus. Pursuant to this, the company, together with Block
Commodities Limited, it entered into an option agreement to acquire 70 percent
interest (the "Acquisition") in a Medicinal Cannabis license granted to Magnus
Cannabis Group (Private) Limited ("Magnus") by the government of Zimbabwe. Block
Commodities Ltd. is listed on the Aquis Stock Exchange, trading with ticker code
BLCC.PL ("BLCC").
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The acquiring parties will each hold 35 percent. The stake in the Magnus
license, will secure supply of medicinal grade cannabis for the production of
Nutraceuticals.
The option is for an exclusivity period of 90 days to complete the Acquisition.
The proposed terms of the Acquisition are as follows:
· Payment of an Option fee of £50,000 (approximately $69,000), to be
apportioned equally between the acquiring parties, and
· Payment by BLCC of £1,500,000 (approximately $2,095,000) through the issue
of 2,142,857,142 fully paid ordinary shares in BLCC (calculated at 0.07p
per share) upon exercise of the option, and contemporaneously the payment
by CCOB of £1.5m of CCOB fully paid ordinary shares, price based on a
30-day VWAP (using the US$/GB£ closing middle market exchange rate
published by Bloomberg on the day immediately prior to completion).
We believe that this opportunity will enhance shareholder value over the longer
term.
Given the foregoing, we had been exploring further options regarding the
monetization of its Emperium Cobalt Project, which may include the sub-licensing
or sale of the assets. Further to these efforts, on March 17, 2021, we signed an
MOU and entered into discussions with UK-based Technology Minerals Limited
("Technology Minerals") for Technology Minerals to acquire the Company's entire
interest ("the assets") in the Emperium Cobalt Project.
Technology Minerals is comprised of mining assets and a major recycling group,
laying the foundations for the UK's first meaningful green circular economy in
the battery industry and is currently in the process of becoming a UK-listed
Company on the on the Standard List of the London Stock Exchange, by way of a
Reverse Take Over.
Technology Minerals will extract the raw materials required for Li-ion Battery
cathodes and then help solve the ecological issue of spent Li-ion batteries by
recycling them for reuse by battery manufacturers.
To date, as noted herein, Century Cobalt has focused on exploring and developing
its large Emperium Cobalt Project to take advantage of the growing demand for
secure, domestic cobalt supplies, but the Directors believe that a sale of its
assets to Technology Minerals represents an attractive and quicker route to
monetize the Project.
If the negotiations are successful and the sale of the Project is completed, the
Company will change its strategic direction and focus on the above noted
medicinal cannabis license opportunity in partnership with its UK listed
partner, Block Commodities Limited.
Results of Operations
Three Months Ended February 29, 2020 Compared to the Three Months Ended February
28, 2019
Revenue
We have not earned any revenues since our inception and we do not anticipate
earning revenues in the upcoming quarter.
Net loss
We had a net loss of $160,491 for the three-month period ended February 29, 2020
which was $77,948 higher than the net loss of $82,543 for the three-month period
ended February 28, 2019. The change in our net loss over the two periods are
primarily a result of an approximate $37,000 increase in consulting fees and
stock-based compensation paid primarily to our president and COO during the
three months ended February 29, 2020, an approximate $32,000 increase in
exploration fees, an approximate $14,000 increase in interest expense from our
new loans to support the business and an $14,000 debt forgiveness during the
three months ended February 28, 2019, offset by an approximate $11,000 decrease
in professional fees from reduced public company reporting activity, an
approximately $8,000 decrease in general administrative expenses from travel,
rent expense, and other expenses.
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Liquidity and Capital Resources
Our balance sheet as of February 29, 2020 reflects current assets of $71,881. We
had cash in the amount of $9 and working capital deficit of $845,866 as of
February 29, 2020. We do not have sufficient working capital to enable us to
carry out our stated plan of operation for the next twelve months.
We anticipate generating losses and, therefore, may be unable to continue
operations further in the future.
Cash Flows
Operating Activities
Net cash used in operating activities during the three-months ended February 29,
2020 was $109,331, a $25,223 increase from the $84,108 net cash outflow during
the three-months ended February 28, 2019 as a result of our work towards
building the business.
Financing Activities
Cash provided by financing activities during the three-months ended February 29,
2020 was $105,415 as compared to $87,000 in cash provided by financing
activities during the three-months ended February 28, 2019 from two stock
subscriptions and promissory notes payable from corporations and related
parties.
We estimate that our operating expenses and working capital requirements for the
12 months ended November 30, 2021 to be as follows:
Estimated Net Expenditures During The Next Twelve Months
Expense Cost
General and administrative expenses $ 25,000
Management and administrative costs $ 300,000
Legal Fees $ 10,000
Auditor Fees $ 15,000
Exploration $ 150,000
Total $ 500,000Of the $500,000 that we require for the next 12 months, we had $9 in cash as of
February 29, 2020 and a working capital deficit of $845,866. In order to improve
our liquidity, we plan to pursue additional equity or debt financing from
private investors or possibly a registered public offering. We do not currently
have any definitive arrangements in place for the completion of any further
financings and there is no assurance that we will be successful in completing
any further financings. If we are unable to achieve the necessary additional
financing, then we plan to reduce the amounts that we spend on our business
activities and administrative expenses in order to be within the amount of
capital resources that are available to us.
We are not aware of any known trends, demands, commitments, events or
uncertainties that will result in or that are reasonably likely to result in our
liquidity increasing or decreasing in any material way.
Future Financings
We anticipate continuing to rely on equity sales of our common stock in order to
continue to fund our business operations. Issuances of additional shares will
result in dilution to our existing stockholders. There is no assurance that we
will achieve any additional sales of our equity securities or arrange for debt
or other financing to fund our planned business activities.
We presently do not have any arrangements for additional financing for the
expansion of our exploration operations, and no potential lines of credit or
sources of financing are currently available for the purpose of proceeding with
our plan of operations.
Off-Balance Sheet Arrangements
We have no off-balance sheet arrangements that have or are reasonably likely to
have a current or future effect on our financial condition, changes in financial
condition, revenues or expenses, results of operations, liquidity, and capital
expenditures or capital resources that are material to stockholders.
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Critical Accounting Policies
Please refer to Note 2 - Summary of Significant Accounting Policies in the
accompanying Notes to the Consolidated Financial Statements.
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CENTURY COBALT CORP. 
