UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

Form 10-Q

 

(Mark One)

☒     QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

 

For the quarterly period ended February 28, 2021

 

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 000-54327

 

CENTURY COBALT CORP.

(Exact name of registrant as specified in its charter)

 

Nevada		98-0579157
(State or other jurisdiction of incorporation or organization)		(I.R.S. Employer Identification No.)
10100 Santa Monica Blvd., Suite 300, Century City, Los Angeles, CA		90067
(Address of principal executive offices)		(Zip Code)

 

(310) 772-2209

(Registrant’s telephone number, including area code)

 

_____________________________________________________________ 

(Former name, former address and former fiscal year, if changed since last report)

 

Securities registered pursuant to Section 12(b) of the Act:

 

Title of each class		Trading Symbol(s)		Name of exchange on which registered
Common Stock		CCOB		OTC Pink
Preferred Stock		N/A		N/A

 

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 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, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company” and “emerging growth company” in Rule 12b-2 of the Exchange Act. (Check one):

 

Large accelerated filer	☐	Non-accelerated filer	☒
Accelerated filer	☐	Smaller reporting company	☒
		Emerging growth company	☐

 

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 is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐     No ☒

 

APPLICABLE ONLY TO CORPORATE ISSUERS

 

As of June 29, 2021, there were 87,075,750 shares of common stock outstanding.

 

 

TABLE OF CONTENTS

 

PART I - FINANCIAL INFORMATION
Item 1.	Financial Statements		4
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations		19
Item 3.	Quantitative and Qualitative Disclosures About Market Risk		22
Item 4.	Controls and Procedures		22
PART II - OTHER INFORMATION
Item 1.	Legal Proceedings		23
Item 1A.	Risk Factors		23
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds		23
Item 3.	Defaults Upon Senior Securities		24
Item 4.	Mine Safety Disclosures		24
Item 5.	Other Information		24
Item 6.	Exhibits		25
SIGNATURES			26

 

2

 

CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS

 

This report includes forward-looking statements that relate to future events or our future financial performance and involve known and unknown risks, uncertainties and other factors that may cause our actual results, levels of activity, performance or achievements to differ materially from any future results, levels of activity, performance or achievements expressed or implied by these forward-looking statements. Words such as, but not limited to, “believe,” “expect,” “anticipate,” “estimate,” “intend,” “plan,” “targets,” “likely,” “aim,” “will,” “would,” “could,” and similar expressions or phrases identify forward-looking statements. We have based these forward-looking statements largely on our current expectations and future events and financial trends that we believe may affect our financial condition, results of operation, business strategy and financial needs. Forward-looking statements include, but are not limited to, statements about risks associated with:

 

	•	Risks related to our business, including:
		•	we have a history of losses;
		•	our auditors have raised substantial doubts about our ability to continue as a going concern;
		•	we have a working capital deficit and need to raise additional capital to continue our business model;
		•	the adverse impact of COVID-19 on our company; and
		•	our reliance on our sole officer and director.
	•	Risks related to regulation applicable to our industry, including:
		•	compliance with existing laws and regulations and possible future changes in laws and regulations; and
		•	any failure to protect personal data;
	•	Risks related to the ownership of our securities, including:
		•	the applicability of penny stock rules; and
		•	material weaknesses in our internal control over financial reporting; and

 

You should read thoroughly this report and the documents that we refer to herein with the understanding that our actual future results may be materially different from and/or worse than what we expect. We qualify all of our forward-looking statements by these cautionary statements including those made in Part I. Item 1A. Risk Factors appearing in our Annual Report on Form 10-K for the fiscal year ended November 30, 2020 as filed with the Securities and Exchange Commission (the “SEC”) on June 16, 2021 and our other filings with the SEC. New risk factors emerge from time to time and it is not possible for our management to predict all risk factors, nor can we assess the impact of all factors on our business or the extent to which any factor, or combination of factors, may cause actual results to differ materially from those contained in any forward-looking statements. Except for our ongoing obligations to disclose material information under the Federal securities laws, we undertake no obligation to release publicly any revisions to any forward-looking statements, to report events or to report the occurrence of unanticipated events. These forward-looking statements speak only as of the date of this report, and you should not rely on these statements without also considering the risks and uncertainties associated with these statements and our business.

 

All references in this report to the “Company”, “Century Cobalt”, “we”, “us,” or “our” are to Century Cobalt Corp., a Nevada corporation and our wholly-owned subsidiary Emperium 1 Holdings Corp., a Nevada corporation.

 

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PART I - FINANCIAL INFORMATION

 

Item 1. Financial Statements

 

Our unaudited interim financial statements for the three-month period ended February 28, 2021 form part of this quarterly report. They are stated in United States Dollars (US$) and are prepared in accordance with United States Generally Accepted Accounting Principles.

 

CENTURY COBALT CORP.
CONSOLIDATED BALANCE SHEETS
		February 28, 2021				November 30, 2020
		(Unaudited)
Assets
Current assets:
Cash		$	6,030			$	19,482
Prepaid expenses			69,171				99,909
Total current assets			75,201				119,391
Other assets
Resource property			248,000				248,000
Total other assets			248,000				248,000
Total Assets		$	323,201			$	367,391
Liabilities and Stockholders' Equity (Deficit)
Current liabilities:
Accounts payable		$	158,107			$	159,341
Accounts payable - related parties			264,539				216,074
Accrued interest			122,233				97,303
Accrued interest - related parties			76,703				68,453
Due to related parties			60,823				60,823
Notes payable - current portion			174,575				174,575
Notes payable to related parties - current portion			364,954				314,124
Convertible notes, net of discount of $2,705 and $8,114
at February 28, 2021 and November 30, 2020, respectively			418,055				259,942
Total current liabilities			1,639,989				1,350,635
Long term liabilities:
Convertible notes, net of discount of $-0- at February 28, 2021 and November 30, 2020			-				134,542
Total long term liabilities			-				134,542
Total liabilities			1,639,989				1,485,177
Commitments and contingencies			-				-
Stockholders' equity (deficit):
Preferred stock, $0.001 par value; 20,000,000 shares authorized, -0- preferred stock shares issued and outstanding as of February 28, 2021 and November 30, 2020			-				-
Common stock, $0.001 par value, 3,500,000,000 shares authorized, 79,061,929 issued and outstanding as of February 28, 2021 and November 30, 2020			79,062				79,062
Additional paid-in capital			2,270,384				2,270,384
Common stock payable			373,693				368,578
Accumulated other comprehensive loss			(48,125	)			(26,052	)
Accumulated deficit			(3,991,802	)			(3,809,758	)
Total stockholders' equity (deficit)			(1,316,788	)			(1,117,786	)
Total Liabilities and Stockholders' equity (deficit)		$	323,201			$	367,391

 

The accompanying notes are an integral part of these financial statements.

 

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CENTURY COBALT CORP.
CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED)
		For the Three Months Ended
		February 28, 2021				February 29, 2020
Operating expenses:
Accounting and legal		$	18,912			$	5,406
Transfer agent and filing fees			1,698				4,791
Consulting			80,493				72,467
Exploration			30,738				34,072
General and administrative			15,579				17,174
Total operating expenses			147,420				133,910
Net operating income (loss)			(147,420	)			(133,910	)
Other income (expense):
Interest expense			(34,624	)			(26,581	)
Total Other income (expense)			(34,624	)			(26,581	)
Net loss		$	(182,044	)		$	(160,491	)
Basic and diluted income (loss) per share		$	(0.00	)		$	(0.00	)
Weighted average number of common shares outstanding - basic and diluted			79,061,929				78,941,929

 

The accompanying notes are an integral part of these financial statements.

 

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CENTURY COBALT CORP.
CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS (UNAUDITED)
		For the Three Months Ended
		February 28, 2021				February 29, 2020
Net loss		$	(182,044	)		$	(160,491	)
Other comprehensive gain (loss):
Foreign currency translation adjustment			(22,073	)			2,292
Total comprehensive loss		$	(204,117	)		$	(158,199	)

 

The accompanying notes are an integral part of these financial statements.

 

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CENTURY COBALT CORP.
CONSOLIDATED STATEMENT OF STOCKHOLDERS' EQUITY (DEFICIT)
		Common Stock								Preferred Stock								Additional Paid-In				Common Stock To Be				Accumulated Other Comprehensive				Accumulated				Total Stockholders'
		Shares				Amount				Shares				Amount				Capital				Issued				Loss				Deficit				Deficiency
For the three months ended February 29, 2020
Balance at November 30, 2019			78,941,929			$	78,942				-			$	-			$	2,261,538			$	247,358			$	(15,254	)		$	(3,225,247	)		$	(652,663	)
Shares earned for stock options																			2,986																2,986
Stock based compensation and stock subscriptions																							106,150												106,150
Other comprehensive income (loss)																											2,292								2,292
Net loss																															(160,491	)			(160,491	)
Balance at February 29, 2020 (unaudited)			78,941,929			$	78,942				-			$	-			$	2,264,524			$	353,508			$	(12,962	)			(3,385,738	)		$	(701,726	)
For the three months ended February 28, 2021
Balance at November 30, 2020			79,061,929			$	79,062				-			$	-			$	2,270,384			$	368,578			$	(26,052	)		$	(3,809,758	)		$	(1,117,786	)
Stock based compensation and accrued expenses																							5,115												5,115
Other comprehensive income (loss)																											(22,073	)							(22,073	)
Net loss																															(182,044	)			(182,044	)
Balance at February 28, 2021 (unaudited)			79,061,929			$	79,062				-			$	-			$	2,270,384			$	373,693			$	(48,125	)			(3,991,802	)		$	(1,316,788	)

 

The accompanying notes are an integral part of these financial statements.

 

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CENTURY COBALT CORP.
CONSOLIDATED STATEMENTS OF CASH FLOW (UNAUDITED)
		For the Three Months Ended
		February 28, 2021				February 29, 2020
Cash flows from operating activities:
Net income (loss)		$	(182,044	)		$	(160,491	)
Adjustments to reconcile net loss to net cash used in operating activities:
Stock based compensation			2,865				3,721
Debt discount interest			5,409				7,995
Changes in operating assets and liabilities:
Prepaid expenses			30,738				29,977
Accounts payable			48				14,429
Accounts payable expenses - related parties			48,465				(23,851	)
Accrued expenses			21,036				11,554
Accrued expenses - related parties			8,179				7,335
Net cash used in operating activities			(65,304	)			(109,331	)
Cash flows from financing activities
Proceeds from stock subscriptions			-				105,415
Proceeds from notes payable to related parties			46,921				-
Net cash provided by financing activities			46,921				105,415
Net increase (decrease) in cash			(18,383	)			(3,916	)
Effect of foreign exchange adjustment			4,931				(151	)
Cash - beginning of the year			19,482				4,076
Cash - end of the year		$	6,030			$	9
Supplemental disclosures:
Interest paid		$	-			$	-
Income taxes		$	-			$	-

 

The accompanying notes are an integral part of these financial statements.

 

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CENTURY COBALT CORP.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) FEBRUARY 28, 2021

 

NOTE 1 – NATURE OF OPERATIONS

 

Century Cobalt Corp. (formerly First American Silver Corp.) was incorporated in the state of Nevada on April 29, 2008. The Company’s principal office is located at 10100 Santa Monica Boulevard, Suite 300, Century City, California 90067. The Company’s principal business activity is the identification and exploration of mineral properties for the purposes of discovering economical cobalt assets.

 

NOTE 2 – SIGNIFICANT ACCOUNTING POLICIES

 

Basis of Presentation

 

The Company’s unaudited consolidated financial statements have been prepared on an accrual basis of accounting, in conformity with accounting principles generally accepted in the United States of America (US GAAP) for interim financial information applicable for a going concern, which assumes that the Company will realize its assets and discharge its liabilities in the ordinary course of the business, and in accordance with the instructions for Form 10-Q and Article 8 of Regulation S-X promulgated under the Securities Exchange Act of 1934, as amended. Certain information and disclosures included in the financial statements prepared in accordance with US GAAP have been condensed or omitted pursuant to such rules and regulations.

 

In the opinion of management, the consolidated financial statements contain all material adjustments, consisting only of normal recurring adjustments necessary to present fairly the financial condition, results of operations, and cash flows of the Company for the interim periods presented.

 

The results for the three months ended February 28, 2021 are not necessarily indicative of the results of operations for the full year. These unaudited financial statements and related footnotes should be read in conjunction with the consolidated financial statements and footnotes thereto included in the Company’s Annual Report on Form 10-K for the year ended November 30, 2020 filed with the Securities and Exchange Commission on June 16, 2021.

 

These consolidated financial statements comprise the accounts of the Company and its wholly owned subsidiary Emperium 1 Holdings Corp. Emperium 1 Holdings Corp. was incorporated as a wholly owned subsidiary on October 8, 2018 by the Company through the issuance of 100 common shares at $0.01 per share for proceeds of $1. As Emperium 1 Holdings Corp. is a holding company and, as such, has no accounts or activity. The Company owns 100% of the issued and outstanding shares of Emperium 1 Holdings Corp. All intercompany balance between the Company and Emperium 1 are eliminated in consolidation.

 

Accounting Basis

 

The Company uses the accrual basis of accounting and accounting principles generally accepted in the United States of America (“US GAAP” accounting). The Company has adopted a November 30 fiscal year end.

 

Risks and Uncertainties

 

The Company’s operations are subject to significant risk and uncertainties including financial, operational, technological, and regulatory risks including the potential risk of business failure. See Note 3 regarding going concern matters.

 

Cash and Cash Equivalents

 

The Company considers all highly liquid investments with maturities of three months or less to be cash equivalents. At February 28, 2021 and November 30, 2020, respectively, the Company had $6,030 and $19,482 of unrestricted cash to be used for future business operations.

 

The Company’s bank accounts are deposited in insured institutions. The funds are insured up to $250,000. At times, the Company’s bank deposits may exceed the insured amount. Management believes it has little risk related to the excess deposits.

 

Prepaid Expenses

 

The Company considers all items incurred for future services to be prepaid expenses.

 

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Fair Value of Financial Instruments

 

Fair value of certain of the Company’s financial instruments including cash, prepaid expenses, accounts payable, accrued expenses, notes payable, and other accrued liabilities approximate cost because of their short maturities. The Company measures and reports fair value in accordance with ASC 820, “Fair Value Measurements and Disclosure” defines fair value, establishes a framework for measuring fair value in accordance with generally accepted accounting principles and expands disclosures about fair value investments.

 

Fair value, as defined in ASC 820, is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The fair value of an asset should reflect its highest and best use by market participants, principal (or most advantageous) markets, and an in-use or an in-exchange valuation premise. The fair value of a liability should reflect the risk of nonperformance, which includes, among other things, the Company’s credit risk.

 

Valuation techniques are generally classified into three categories: the market approach; the income approach; and the cost approach. The selection and application of one or more of the techniques may require significant judgment and are primarily dependent upon the characteristics of the asset or liability, and the quality and availability of inputs. Valuation techniques used to measure fair value under ASC 820 must maximize the use of observable inputs and minimize the use of unobservable inputs. ASC 820 also provides fair value hierarchy for inputs and resulting measurement as follows:

 

Level 1: Quoted prices (unadjusted) in active markets that are accessible at the measurement date for identical assets or liabilities.

 

Level 2: Quoted prices for similar assets or liabilities in active markets; quoted prices for identical or similar assets or liabilities in markets that are not active; inputs other than quoted prices that are observable for the asset or liability; and inputs that are derived principally from or corroborated by observable market data for substantially the full term of the assets or liabilities; and

 

Level 3: Unobservable inputs for the asset or liability that are supported by little or no market activity, and that are significant to the fair values.

 

Fair value measurements are required to be disclosed by the Level within the fair value hierarchy in which the fair value measurements in their entirety fall. Fair value measurements using significant unobservable inputs (in Level 3 measurements) are subject to expanded disclosure requirements including a reconciliation of the beginning and ending balances, separately presenting changes during the period attributable to the following: (i) total gains or losses for the period (realized and unrealized), segregating those gains or losses included in earnings, and a description of where those gains or losses included in earning are reported in the statement of income. All assets and liabilities of the Company approximate fair value.

 

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Valuation of Long-Lived and Intangible Assets

 

We assess the impairment of long-lived assets periodically, or at least annually, and whenever events or changes in circumstances indicate that the carrying value may not be recoverable. Factors considered important, which could trigger an impairment review, include the following: significant underperformance relative to historical or projected future cash flows; significant changes in the manner of use of the assets or the strategy of the overall business; and significant negative industry trends. When management determines that the carrying value of long-lived and intangible assets may not be recoverable, impairment is measured as the excess of the assets’ carrying value over the estimated fair value. Management is not aware of any impairment changes that may currently be required; however, we cannot predict the occurrence of events that might adversely affect the reported values in the future.

 

Concentrations of Credit Risk

 

The Company maintains its cash in bank deposit accounts, the balances of which at times may exceed federally insured limits. The Company continually monitors its banking relationships and consequently has not experienced any losses in such accounts. The Company believes it is not exposed to any significant credit risk on cash and cash equivalents.

 

Stock-Based Compensation

 

The Company accounts for share-based compensation in accordance with the fair value recognition provisions of the Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) No. 718 and No. 505. After December 15, 2018, the scope of Topic 718, Compensation—Stock Compensation, was expanded to include share-based payments issued to nonemployees for goods and services. The Company issues restricted stock to employees and consultants for their services. Cost for these transactions are measured at the fair value of the equity instruments issued at the date of grant. These shares are considered fully vested and the fair market value is recognized as expense in the period granted. The Company recognized consulting expenses and a corresponding increase to additional paid-in-capital related to stock issued for services. For agreements requiring future services, the consulting expense is to be recognized ratably over the requisite service period.

 

Total stock-based compensation amounted to $2,865 and $3,721 for the three months ended February 28, 2021 and February 29, 2020, respectively.

 

Income Taxes

 

Income taxes are computed using the asset and liability method. Under the asset and liability method, deferred income tax assets and liabilities are determined based on the differences between the financial reporting and tax bases of assets and liabilities and are measured using the currently enacted tax rates and laws. A valuation allowance is provided for the amount of deferred tax assets that, based on available evidence, are not expected to be realized. It is the Company’s policy to classify interest and penalties on income taxes as interest expense or penalties expense. As of February 28, 2021, there have been no interest or penalties incurred on income taxes.

 

Use of Estimates

 

The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date the financial statements and the reported amount of revenues and expenses during the reporting period. Actual results could differ from those estimates.

 

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Revenue Recognition

 

Revenue is recognized when a customer obtains control of promised goods or services and is recognized in an amount that reflects the consideration that an entity expects to receive in exchange for those goods or services. In addition, the standard requires disclosure of the nature, amount, timing, and uncertainty of revenue and cash flows arising from contracts with customers. The amount of revenue that is recorded reflects the consideration that the Company expects to receive in exchange for those goods. The Company applies the following five-step model in order to determine this amount: (i) identification of the promised goods in the contract; (ii) determination of whether the promised goods are performance obligations, including whether they are distinct in the context of the contract; (iii) measurement of the transaction price, including the constraint on variable consideration; (iv) allocation of the transaction price to the performance obligations; and (v) recognition of revenue when (or as) the Company satisfies each performance obligation.

 

Once a contract is determined to be within the scope of ASC 606 at contract inception, the Company reviews the contract to determine which performance obligations the Company must deliver and which of these performance obligations are distinct. The Company recognizes as revenues the amount of the transaction price that is allocated to the respective performance obligation when the performance obligation is satisfied or as it is satisfied. Generally, the Company’s performance obligations are transferred to customers at a point in time, typically upon delivery.

 

Basic Income (Loss) Per Share

 

Basic income (loss) per share is calculated by dividing the Company’s net loss applicable to common shareholders by the weighted average number of common shares during the period. Diluted earnings per share is calculated by dividing the Company’s net income available to common shareholders by the diluted weighted average number of shares outstanding during the year. The diluted weighted average number of shares outstanding is the basic weighted number of shares adjusted for any potentially dilutive debt or equity. The convertible debt to common shares and unissued stock earned could potentially amount to approximately 20,500,000 additional shares issued by the Company. The Company’s convertible notes and unissued shares are excluded from the computation of diluted earnings per share as they are anti-dilutive due to the Company’s losses for the three months ended February 28, 2021 and February 29, 2020.

 

Foreign Currency Translation

 

The functional and presentation currency of the Company is the U.S. dollar. Transactions denominated in a currency other than the functional currency are recorded on the initial recognition at the exchange rate at the date of the transaction. Assets and liabilities that are not denominated in the functional currency are remeasured into the functional currency with any related gain or loss recorded in earnings. The Company translates assets and liabilities of its non-U.S. dollar functional currency foreign transactions into the U.S. dollar reporting currency at exchange rates in effect at the balance sheet date. The Company translates income and expense items of such foreign transactions into the U.S. dollar reporting currency at the exchange rate on the date of the transaction. Accumulated translation adjustments are reported in stockholders’ equity, as a component of accumulated other comprehensive income (loss).

 

Recent Accounting Pronouncements

 

In December 2019, the FASB issued ASU 2019-12, Simplifying the Accounting for Income Taxes, as part of its Simplification Initiative to reduce the cost and complexity in accounting for income taxes. ASU 2019-12 removes certain exceptions related to the approach for intra-period tax allocation, the methodology for calculating income taxes in an interim period and the recognition of deferred tax liabilities for outside basis differences. ASU 2019-12 also amends other aspects of the guidance to help simplify and promote consistent application of US GAAP. The guidance is effective for interim and annual periods beginning after December 15, 2020, with early adoption permitted. The Company is currently evaluating the effect ASU 2019-12 will have on the consolidated financial statements and related disclosures.

 

In August 2020, the FASB issued ASU 2020-06, Debt—Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging—Contracts in Entity’s Own Equity (Subtopic 815-40)—Accounting for Convertible Instruments and Contracts in an Entity’s Own Equity. ASU 2020-06 reduces the number of accounting models for convertible debt instruments and convertible preferred stock. For convertible instruments with conversion features that are not required to be accounted for as derivatives under Topic 815, Derivatives and Hedging, or that do not result in substantial premiums accounted for as paid-in capital, the embedded conversion features no longer are separated from the host contract. ASU 2020-06 also removes certain conditions that should be considered in the derivatives scope exception evaluation under Subtopic 815-40, Derivatives and Hedging—Contracts in Entity’s Own Equity, and clarify the scope and certain requirements under Subtopic 815-40. In addition, ASU 2020-06 improves the guidance related to the disclosures and earnings-per-share (EPS) for convertible instruments and contract in entity’s own equity. ASU 2020-06 is effective for public business entities that meet the definition of a Securities and Exchange Commission (SEC) filer, excluding entities eligible to be smaller reporting companies as defined by the SEC, for fiscal years beginning after December 15, 2021, including interim periods within those fiscal years. For all other entities, the amendments are effective for fiscal years beginning after December 15, 2023, including interim periods within those fiscal years. Early adoption is permitted, but no earlier than fiscal years beginning after December 15, 2020, including interim periods within those fiscal years. The Board specified that an entity should adopt the guidance as of the beginning of its annual fiscal year. The Company is currently evaluation the impact this ASU will have on its consolidated financial statements.

 

Management believes recently issued accounting pronouncements will have no impact on the financial statements of the Company.

 

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Mineral Properties

 

Costs of exploration are expensed as incurred. Mineral property acquisition costs are capitalized including licenses and lease payments. Although the Company has taken steps to verify title to mineral properties in which it has an interest, these procedures do not guarantee the Company’s title. Such properties may be subject to prior agreements or transfers and title may be affected by undetected defects.

 

Mineral properties are analyzed for impairment on an annual basis, or more often if warranted by circumstances. Impairment losses are recorded on mineral properties used in operations when indicators of impairment are present.

 

Capitalization

 

Only assets with a cost of $5,000 and a useful life of over 1 year are capitalized. All other costs are expensed in the period incurred.

 

Reclassifications

 

Certain prior year amounts have been reclassified for comparative purposes to conform to the current-year financial statement presentation. These reclassifications had no effect on previously reported results of operations.

 

NOTE 3 – GOING CONCERN

 

The accompanying financial statements have been prepared assuming that Century Cobalt Corp., Inc. will continue as a going concern. The Company has a working capital deficit, has not yet received revenue from sales of products or services, and has incurred losses from operations. These factors raise substantial doubt about the Company’s ability to continue as a going concern. Without realization of additional debt or capital, it would be unlikely for the Company to continue as a going concern. The financial statements do not include any adjustments that might result from this uncertainty.

 

The Company’s activities to date have been supported by debt and equity financing. It has sustained losses in all previous reporting periods with an inception to date loss of $3,991,802 as of February 28, 2021. Management continues to seek funding from its shareholders and other qualified investors.

 

NOTE 4 – PREPAID EXPENSES

 

Prepaid expenses include the prepayment of the annual mining claims renewal fees.

 

Prepaid expenses are as follows:

 

		February 28, 2021				November 30, 2020
Annual mining claims renewal fees		$	69,171			$	99,909
Total		$	69,171			$	99,909

 

NOTE 5 – RESOURCE PROPERTY

 

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 by issuing a further 500,000 common shares valued at $20,000 to Plateau Ventures LLC. Such option had been exercised with additional claims acquired, resulting in a total of 695 claims comprising approximately 13,900 acres. The value of the claims was $248,000 at February 28, 2021 and November 30, 2020 and recorded at resource property in the accompanying consolidated balance sheets. The Company perform an annual impairment test at November 30, 2020 and determined an impairment charge was not necessary.

 

Oriental Rainbow has assigned its interest in the property to us in consideration for 2,500,000 restricted shares (issued) of common stock valued at $100,000 (the “Consideration Shares”). The Company has 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, valued at $20,000, to Plateau upon listing on a recognized stock exchange (issued) and paying Plateau $1,000,000 in four equal staged payments upon completion of a positive feasibility study on the property. The vendor retains a 1% royalty on revenue derived from the sale of cobalt concentrate and other ore extracts from the property. The Company has the option to purchase this 1% royalty at any time for $1,000,000 in cash or common shares. As of February 28, 2021 and November 30, 2020, respectively, the Company has invested $248,000 into the above-mentioned mineral claims. These amounts are reported in the accompanying consolidated balance sheet.

 

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NOTE 6 – NOTES PAYABLE

 

Notes payable consisted of the following at February 28, 2021:

 

Date of Note		Principal Amount at Issuance ($)				Interest Rate				Maturity Date		Interest Accrued ($)
October 20, 2016 (1)			5,000				8	%		October 20, 2017			1,745
January 9, 2017 (1)			9,000				8	%		January 9, 2018			2,981
April 24, 2017 (1)			10,000				8	%		April 24, 2018			3,081
June 19, 2017 (1)			7,000				8	%		June 19, 2018			2,072
September 18, 2017 (1)			6,000				8	%		September 18, 2018			1,655
January 5, 2018 (1)			10,000				8	%		January 5, 2019			2,520
April 17, 2018 (1)			30,000				8	%		April 17, 2019			6,892
July 27, 2018 (1)			31,700				12	%		July 27, 2019			9,869
August 15, 2018 (1)			108,000				12	%		August 15, 2019			32,951
September 7, 2018 (1)			15,000				12	%		July 31, 2020			4,463
September 12, 2018 (1)			20,500				12	%		August 15, 2020			6,066
September 27, 2018 (1)			10,000				12	%		July 31, 2020			2,909
October 10, 2018 (1)			42,000				12	%		July 31, 2020			12,041
November 20, 2018 (1)			7,905				12	%		July 31, 2020			2,160
November 20, 2018 (1)			7,970				12	%		July 31, 2020			2,177
December 18, 2018 (1)			25,000				12	%		July 31, 2020			6,600
January 24, 2019 (1)			42,000				12	%		August 15, 2020			10,578
February 18, 2019 (1)			20,000				12	%		February 18, 2020			4,873
March 6, 2019 (1)			10,000				12	%		August 15, 2020			2,383
May 3, 2019 (1)			25,000				12	%		July 31, 2020			5,482
July 1, 2019 (3)			34,805				10	%		December 30, 2021			7,537
July 15, 2019 (3)			34,805				10	%		December 30, 2021			7,404
July 31, 2019 (3)			34,805				10	%		December 30, 2021			7,252
August 30, 2019 (2) (4)			111,376				10	%		April 16, 2021			18,943
September 3, 2019 (3)			20,883				10	%		December 30, 2021			4,157
September 4, 2019 (2) (4)			27,844				10	%		April 16, 2021			4,697
October 8, 2019 (3)			11,138				10	%		December 30, 2021			2,109
November 6, 2019 (3)			4,177				10	%		December 30, 2021			759
March 3, 2020 (4)			2,228				10	%		April 16, 2021			443
July 10, 2020			13,922				5	%		June 18, 2021			444
September 1, 2020 (4)			138,700				10	%		April 16, 2021			20,710
September 2, 2020			13,921				5	%		June 18, 2021			340
November 27, 2020			20,883				5	%		June 18, 2021			266
December 22, 2020			20,883				5	%		June 18, 2021			195
January 12, 2021			27,844				5	%		June 18, 2021			180
Sub Total			960,289										198,936
Less Debt Discounts			2,705										-
Grand Total			957,584										198,936

 

(1)	The Company is not compliant with the repayment terms of the notes payable. There are no penalties associated with notes past the due date.
(2)	Interest partially paid by Company prior to November 30, 2019 for $3,883.

 

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Convertible notes payable consisted of the following at February 28, 2021:

 

(3)	On July 30, 2019, the Company entered into a convertible unsecured term loan facility of £200,000 ($253,900) for funding working capital requirements. The promissory note has a maturity date of October 30, 2020, an interest rate of 10% and a conversion rate of $0.08 per share. After maturity, the interest rate increases to 8% above the Bank of England Base Rate. In addition, a 5% facility fee is added to the loan. The Company may draw the loan in installments of £25,000 ($31,735) at any time on or after the date of this agreement. During the year ended November 30, 2019, the Company has drawn six installments against the loan facility for an aggregate of $130,633. The Company calculated the fair value of the beneficial conversion feature as the difference between the conversion price and the fair market value of the Company’s common stock into on the date of issuance. The fair value of the conversion option in connection with the note on the date of issuance aggregated $12,654, and was recorded as debt discount. The debt discount was amortized through the term of the note. The unpaid balance including accrued interest was $169,830 and $159,183 at February 28, 2021 and November 30, 2020, respectively.
(4)	On August 14, 2019, the Company entered into a convertible unsecured term loan facility of £200,000 ($241,220) for funding working capital requirements. The promissory note has a maturity date of April 30, 2021, an interest rate of 10% and a conversion rate of $0.03 per share. After maturity, the interest rate increases to 8% above the Bank of England Base Rate. In addition, a 5% facility fee is added to the loan. The Company may draw the loan in installments at any time on or after the date of this agreement. During the year ended November 30, 2019, the Company has drawn two installments against the loan facility for an aggregate of $129,340. The Company calculated the fair value of the beneficial conversion feature as the difference between the conversion price and the fair market value of the Company’s common stock into on the date of issuance. The fair value of the conversion option in connection with the note on the date of issuance aggregated $34,853, and was recorded as debt discount. The debt discount was amortized through the term of the note. During the three months ended May 31, 2020, the Company received a third installment for $2,050. The Company calculated the fair value of the beneficial conversion feature as the difference between the conversion price and the fair market value of the Company’s common stock into on the date of issuance. The fair value of the conversion option in connection with the note on the date of issuance was $-0-. During the three months ended August 31, 2020, the Company received a third installment for $130,646. The Company calculated the fair value of the beneficial conversion feature as the difference between the conversion price and the fair market value of the Company’s common stock into on the date of issuance. The fair value of the conversion option in connection with the note on the date of issuance was $-0-. The unpaid balance including accrued interest was $324,941 and $297,562 at February 28, 2021 and November 30, 2020, respectively.

  

As of February 28, 2021, the total short-term loans - convertible amounted to $494,771 which includes $74,011 of accrued interest. The conversion price of the note was fixed and determinable on the date of issuance and as such in accordance with ASC Topic 815 “Derivatives and Hedging” (“ASC 815”), the embedded conversion option of the note was not considered a derivative liability. The beneficial conversion features of certain convertible notes are at a price below fair market value. The Company recorded interest expense on the debt discount of $5,409 and $7,995 for the three months ended February 28, 2021 and February 29, 2020, respectively. The unamortized debt discount was $2,705 and $8,114 at February 28, 2021 and November 30, 2020, respectively.

 

Notes payable and convertible notes payable transactions during the three months ended February 28, 2021 consisted of the following:

 

Balance, November 30, 2020		$	891,295
Borrowings			46,921
Plus, foreign exchange adjustment			22,073
Balance, February 28, 2021		$	960,289

 

Notes payable and convertible notes payable transactions principal repayment schedule consisted of the following:

 

Fiscal year ended November 30, 2021		$	819,677
Fiscal year ended November 30, 2022			140,612
Total		$	960,289

 

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NOTE 7 – RELATED PARTY TRANSACTIONS

 

As at February 28, 2021, accounts payable and compensation owing to stockholders and officers of the Company were $264,539 (November 30, 2020: $216,074).

 

As at February 28, 2021, the Company owed $60,823 to its President and Director (November 30, 2020: $60,823).

 

On February 28, 2021, notes payable owing to related parties was $364,954 (November 30, 2020: $314,124) and accrued interest owing to related parties was $76,703 (November 30, 2020: $68,453).

 

On September 11, 2018, the Company signed a Consulting Agreement for the Company’s former Chief Operating Officer (COO) beginning August 1, 2018 through December 31, 2020. Effective April 1, 2018, the former COO is compensated £200 (approximately $250) for each day performing services to the Company (approximately one day per week). Effective August 1, 2018, the former COO was compensated with 250,000 unregistered shares of the Company’s common stock valued at $10,000 or $0.04 per share. On February 1, 2019 the CCO was compensated with 250,000 unregistered shares of the Company’s common stock valued at $36,750 or $0.147 share. On August 1, 2019 the CCO was compensated with 250,000 unregistered shares of the Company’s common stock valued at $24,375 or $0.0975 share. The COO resigned on December 1, 2020 and will serve the company in other capacities. The cash compensation amounted to $-0- and $4,578 for the three months ended February 28, 2021 and February 29, 2020, respectively.

 

On September 17, 2018, the Company signed a three-year Consulting Agreement for the Company’s President. Effective June 1, 2018, the President is compensated $8,500 per month for an aggregate of $102,000 per year. Effective August 1, 2018, the President was compensated with 5,000,000 unregistered shares of the Company’s common stock valued at $200,000 or $0.04 per share. In addition, on August 1 of each year for this agreement, the President will be compensated with 1,000,000 unregistered shares of the Company’s common stock. On August 1, 2018, 1,000,000 unregistered shares of the Company’s common stock were earned by the Company’s President. The shares were valued at $40,000 or $0.04 share. On August 1, 2019, 1,000,000 unregistered shares of the Company’s common stock were earned by the Company’s President. The shares were valued at $97,500 or $0.975 share. Effective August 1, 2019, the President compensation was increased to $15,000 per month for an aggregate of $180,000 per year. On August 1, 2020, 1,000,000 unregistered shares of the Company’s common stock were earned by the Company’s President. The shares were valued at $18,600 or $0.0186 share. The cash compensation amounted to $45,000 for the three months ended February 28, 2021 and February 29, 2020.

 

NOTE 8 – CAPITAL STOCK

 

The Company has 20,000,000 preferred shares authorized at a par value of $0.001 per share. As of February 28, 2021, no rights have been assigned to the preferred shares and the rights will be established upon issuance.

 

As at February 28, 2021, the Company has 3,500,000,000 common shares authorized at a par value of $0.001 per share.

 

On February 1, 2019, the Company granted 250,000 at $0.147 per share, valued at $36,750, unregistered common shares pursuant to a consulting agreement for the Company’s former Chief Operating Officer (COO). As of February 28, 2021, the shares have not been issued to the former COO.

 

On April 1, 2019, the Company granted 163,132 at $0.1226 per share, valued at $20,000, unregistered common shares as per an option agreement to explore and evaluate the battery materials in South Dakota. See Note 5. As of February 28, 2021, the shares have not been issued to the individual.

 

On June 5, 2019, the Company entered into an agreement with a consultant to provide finance and accounting services to the Company. The Consultant is compensated with a combination of cash and unregistered shares of the Company’s common stock. In addition, the consultant was granted 50,000 shares of the Company’s common stock valued at $4,990 or .0998 per share. The consultant has earned 42,883 shares valued at $2,468 or $0.0575 per share for the three months ended February 28, 2021 and 503,341 shares valued at $13,465 or $0.0268 per share at November 30, 2020, for an aggregate of 546,224 shares valued at $15,932 or $0.0292 per share. As of February 28, 2021, the shares have not been issued to the consultant.

 

On August 1, 2019, the Company granted 1,000,000 unregistered common shares, at $0.0975 per share, valued at $97,500, to the Company’s president pursuant to a consulting agreement for annual share compensation. As of February 28, 2021, the shares have not been issued to the Company’s president.

 

On August 1, 2019, the Company granted 250,000 at $0.0975 per share, valued at $24,375, unregistered common shares for services to the Company for the Company’s former Chief Operating Officer (COO). As of February 28, 2021, the shares have not been issued to the Company’s former COO.

 

On October 8, 2019, the Company issued a stock subscription for 120,000 unregistered shares of the Company’s common stock to an investor. The shares were valued at $5,980 or $0.05 per share. The subscription amount was funded on October 9, 2019. On April 27, 2020, the Company issued 120,000 unregistered shares of the Company’s common stock to the investor. The Company used the proceeds for working capital.

 

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On November 13, 2019, the Company issued a stock subscription for 1,693,809 unregistered shares of the Company’s common stock to an investor. The shares were valued at $40,652 or $0.024 per share. The subscription amount was funded on November 13, 2019. The shares were issued to the investor on November 26, 2019. The Company used the proceeds for working capital.

 

On December 23, 2019, the Company issued a stock subscription for 912,310 unregistered shares of the Company’s common stock to an investor. The shares were valued at $45,616 or $0.05 per share. The subscription amount was funded on December 24, 2019. As of February 28, 2021, the shares have not been issued to the investor. The Company used the proceeds for working capital.

 

On August 1, 2020, the Company granted 1,000,000 unregistered common shares, at $0.0186 per share, valued at $18,600, to the Company’s president pursuant to a consulting agreement for annual share compensation. As of February 28, 2021, the shares have not been issued to the Company’s president.

 

On February 3, 2020, the Company issued a stock subscription for 2,174,545 unregistered shares of the Company’s common stock to an investor. The shares were valued at $59,800 or $0.0275 per share. The subscription amount was funded on February 7, 2020. As of February 29, 2020, the shares have not been issued to the investor. The Company used the proceeds for working capital.

 

On January 11, 2021, the Company issued a stock subscription for 176,966 unregistered shares of the Company’s common stock to pay a past due balance from one of the Company’s vendors. The shares were valued at $5,309 or $0.03 per share. As of February 28, 2021, the shares have not been issued to the vendor.

 

As of February 28, 2021, the Company had 79,061,929 (November 30, 2020: 79,061,929) common shares issued and outstanding.

 

NOTE 9 – MATERIAL CONTRACTS

 

On January 9, 2019, the Company entered an agreement with a consultant to head the Company’s Advisory Board to provide essential prospective on technology and public policy developments that are shaping the cobalt markets. In addition, the consultant will provide press releases, additional messaging and focus on exploring potential relationships with major cobalt users. The agreement terminates on December 31, 2019. After December 31, 2019, the agreement automatically renews unless the Company or consultant provide 30 days written notice. The consultant is compensated with a $5,000 retainer which commences the first of the month following the completion of the Company’s next capital raise. In addition, the Company granted the consultant a three-year option to purchase 250,000 shares of the Company’s unregistered common stock at $0.10 per share. The option vested as to 100,000 shares on the grant date, vests 100,000 shares on August 9, 2019 and 50,000 on January 9, 2020. The fair value of the option was $23,891. The Company uses a Black-Scholes-Merton option pricing model to estimate the fair value option with the following assumptions:

 

Risk-free interest rate			2.54	%
Expected life (in years)			3
Expected volatility			310.6	%
Grant date fair value		$	.097

 

On March 11, 2019, the Company signed a twelve-month lease agreement for a four-bedroom living unit. The lease starts on April 1, 2019 and ends on March 31, 2020. The monthly rental is $1,200 and an aggregate of $14,400 over the term of the lease. The lease terminated on March 31, 2020 and was not renewed.

 

On April 2, 2019, the Company signed a twelve-month lease agreement for office space. The lease starts on 1 July, 2019 and ends on 30 June, 2020. The monthly rental is $730 and an aggregate of $8,761 over the term of the lease. The lease was renewed on a twelve-month lease agreement ending on June 30, 2021 for $770 per month and an aggregate of $9,240 over the term of the lease.

 

The rent expense recognized was $2,309 and $6,684 for three months ended February 28, 2021and February 29, 2020.

 

On September 14, 2019, the Company entered an agreement with a consultant as the Company’s Business Development Director including such other management advisory services as may be reasonably requested by the Company. The agreement terminates on August 31, 2021. The consultant is compensated with $4,000 a month beginning September 1, 2019. For three months ended February 28, 2021 and February 29, 2020, the Consultant has earned $12,000.

 

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NOTE 10 – SUBSEQUENT EVENTS

 

Subsequent to February 28, 2021, the Company has drawn an additional three (3) installments for $125,783 under a loan agreement dated On June 18, 2020 with a related party. The loan bears interest at 5% and has a maturity date of June 18, 2021. As of June 29, 2021, the Company has drawn seven (8) installments under the agreement for an aggregate of $218,456.

 

On March 17, 2021 the Company signed an option agreement together with Block Commodities Limited to acquire a 70 percent interest in a Medicinal Cannabis license granted to Magnus Cannabis Group Limited (“Magnus”) by the government of Zimbabwe. Block Commodities Ltd. is listed on the Aquis Stock Exchange, trading with ticker code BLCC.PL (“BLCC”).

 

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 $2,095,000) through the issue of 2,142,857,142 fully paid ordinary shares in BLCC (valued at 0.07p, per share) upon exercise of the option, and contemporaneously the payment by CCOB of £1.5m of CCOB fully paid ordinary shares, price based on a 30-day VWAP (using the US$/GB£ closing middle market exchange rate published by Bloomberg on the day immediately prior to completion).

 

On March 18, 2021, the Company issued 2,000,000 unregistered shares of the Company’s common stock to the Company’s CEO. The shares were earned on August 1, 2018 and August 1, 2019 from a consulting agreement with the Company’s CEO. The shares were valued at $137,500 or $0.0688 per share.

 

On April 19, 2021, the Company issued 176,966 unregistered shares of the Company’s common stock to a vendor. The shares were issued to convert a post due payable balance from the vendor. The shares were valued on January 11, 2021. The shares were valued at $5,309 or $0.03 per share.

 

On May 21, 2021, the Company issued 1,750,000 unregistered shares of the Company’s common stock to the Company’s former COO. The shares were earned on May 21, 2021 from a consulting agreement with the Company’s former COO. The shares were valued at $40,425 or $0.0231 per share.

 

On December 23, 2019, the Company issued a stock subscription for 912,310 unregistered shares of the Company’s common stock to an investor. The shares were valued at $45,616 or $0.05 per share. The subscription amount was funded on December 24, 2019. The shares were issued on May 21, 2021.

 

On February 3, 2020, the Company issued a stock subscription for 2,174,545 unregistered shares of the Company’s common stock to an investor. The shares were valued at $59,800 or $0.0275 per share. The subscription amount was funded on February 7, 2020. The shares were issued on May 21, 2021.

 

On May 21, 2021, the Company issued 1,000,000 unregistered shares of the Company’s common stock to the Company’s CEO. The shares were earned on August 1, 2020 from a consulting agreement with the Company’s CEO. The shares were valued at $18,600 or $0.0186 per share.

 

The Company has evaluated all events occurring subsequently to these financial statements through June 29, 2021 and determined there were no other items to disclose.

 

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Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations

 

FORWARD LOOKING STATEMENTS

 

The following discussion of our financial condition and results of operations for the three and nine months ended February 28, 2021 and February 29, 2020 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 for the fiscal year ended November 30, 2020, as filed with the SEC on June 16, 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.

 

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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”).

 

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 28, 2021 Compared to the Three Months Ended February 29, 2020

 

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 $182,044 for the three-month period ended February 28, 2021 which was $21,553 higher than the net loss of $160,491 for the three-month period ended February 29, 2020. The change in our net loss over the two periods are primarily a result of an approximate $10,000 increase in professional fees as we work towards returning to full SEC reporting status, an approximate $8,000 increase in consulting fees primarily from a new agreement with our former COO and an approximate $8,000 increase in interest expense from our new loans and related debt discounts to support the business, offset by approximate $3,000 decrease in exploration fees for potential mining operations and an approximately $1,000 decrease in general administrative expenses.

 

Liquidity and Capital Resources

 

Our balance sheet as of February 28, 2021 reflects current assets of $75,201. We had cash in the amount of $6,030 and working capital deficit of $1,564,788 as of February 28, 2021. 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.

 

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Cash Flows

 

Operating Activities

 

Net cash used in operating activities during the three months ended February 28, 2021 was $65,304, a $44,027 decrease from the $109,331 net cash outflow during the three months ended February 29, 2020 as a result of the Company’s decreased activity from our operations due to the Covid-19 pandemic.

 

Financing Activities

 

Cash provided by financing activities during the three months ended February 28, 2021 was $46,921 as compared to $105,415 in cash provided by financing activities during the three months ended February 29, 2020 from a related party promissory notes payable during the three months ended February 28, 2021 and two stock subscription during the three months ended February 29, 2020.

 

We estimate that our operating expenses and working capital requirements for the 12 months ended February 28, 2022 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		$	500,000

 

Of the $500,000 that we require for the next 12 months, we had $6,030 in cash as of February 28, 2021 and a working capital deficit of $1,564,788. 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.

 

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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.

 

Critical Accounting Policies

 

Please refer to Note 2 - Summary of Significant Accounting Policies in the accompanying Notes to the Consolidated Financial Statements.

 

Item 3. Quantitative and Qualitative Disclosures About Market Risk

 

As a “smaller reporting company”, we are not required to provide the information required by this Item.

 

Item 4. Controls and Procedures

 

Management’s Report on Disclosure Controls and Procedures

 

We maintain disclosure controls and procedures that are designed to ensure that information required to be disclosed in our reports filed under the Securities Exchange Act of 1934 , as amended, is recorded, processed, summarized and reported within the time periods specified in the Securities and Exchange Commission’s rules and forms, and that such information is accumulated and communicated to our management, including our president (our principal executive officer, principal financial officer and principle accounting officer) to allow for timely decisions regarding required disclosure.

 

As of the end of the quarter covered by this report, we carried out an evaluation, under the supervision and with the participation of our president (our principal executive officer, principal financial officer and principal accounting officer), of the effectiveness of the design and operation of our disclosure controls and procedures. Based on the foregoing, our president (our principal executive officer, principal financial officer and principal accounting officer) concluded that our disclosure controls and procedures were not effective as of the end of the period covered by this quarterly report.

 

Changes in Internal Control Over Financial Reporting

 

During the period covered by this report there were no changes in our internal control over financial reporting that materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

 

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PART II - OTHER INFORMATION

 

Item 1. Legal Proceedings

 

We know of no material, existing or pending legal proceedings against our company, nor are we involved as a plaintiff in any material proceeding or pending litigation. There are no proceedings in which any of our directors, executive officers or affiliates, or any registered or beneficial stockholder, is an adverse party or has a material interest adverse to our interest.

 

Item 1A. Risk Factors

 

We incorporate by reference the risk factors disclosed in Part I, Item 1A of our Annual Report on Form 10-K for the fiscal year ended November 30, 2020 as filed with the SEC on June 16, 2021.

 

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds

 

On August 1, 2018, the Company granted 1,000,000 unregistered common shares, at $0.04 per share, valued at $40,000, to the Company’s president pursuant to a consulting agreement for annual share compensation. The Shares were issued to the Company’s president on March 18, 2021.

 

On February 1, 2019, the Company granted 250,000 at $0.147 per share, valued at $36,750, unregistered common shares pursuant to a consulting agreement for the former Company’s Chief Operating Officer (COO). As of June 29, 2021, the shares have not been issued to the former COO.

 

On April 1, 2019, the Company granted 163,132 at $0.1226 per share, valued at $20,000, unregistered common shares as per an option agreement to explore and evaluate the battery materials in South Dakota. See Note 5. As of June 29, 2021, the shares have not been issued to the individual.

 

On June 5, 2019, the Company entered into an agreement with a consultant to provide finance and accounting services to the Company. The Consultant is compensated with a combination of cash and unregistered shares of the Company’s common stock. In addition, the consultant was granted 50,000 shares of the Company’s common stock valued at $4,990 or .0998 per share. As of June 29, 2021, the consultant has earned an aggregate of 546,224 shares valued at $15,932 or $0.0292 per share. As of June 29, 2021, the shares have not been issued to the consultant.

 

On August 1, 2019, the Company granted 1,000,000 unregistered common shares, at $0.0975 per share, valued at $97,500, to the Company’s president pursuant to a consulting agreement for annual share compensation. The Shares were issued to the Company’s president on March 18, 2021.

 

On August 1, 2019, the Company granted 250,000 at $0.0975 per share, valued at $24,375, unregistered common shares for services to the Company for the former Company’s Chief Operating Officer (COO). As of June 29, 2021, the shares have not been issued to the Company’s former COO.

 

On October 8, 2019, the Company issued a stock subscription for 120,000 unregistered shares of the Company’s common stock to an investor. The shares were valued at $5,980 or $0.05 per share. The subscription amount was funded on October 9, 2019. The shares were issued to the investor on April 27, 2020. The Company used the proceeds for working capital.

 

On December 23, 2019, the Company issued a stock subscription for 912,310 unregistered shares of the Company’s common stock to an investor. The shares were valued at $45,616 or $0.05 per share. The subscription amount was funded on December 24, 2019. The shares were issued on May 21, 2021 to the investor. The Company used the proceeds for working capital.

 

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On February 3, 2020, the Company issued a stock subscription for 2,174,545 unregistered shares of the Company’s common stock to an investor. The shares were valued at $59,800 or $0.0275 per share. The subscription amount was funded on February 7, 2020. The shares were issued on May 21, 2021 to the investor. The Company used the proceeds for working capital.

 

On August 1, 2020, the Company granted 1,000,000 unregistered common shares, at $0.0186 per share, valued at $18,600, to the Company’s president pursuant to a consulting agreement for annual share compensation. The shares were issued on May 21, 2021 to the Company’s president.

 

On January 11, 2021, the Company issued a stock subscription for 176,966 unregistered shares of the Company’s common stock to pay a past due balance from one of the Company’s vendors. The shares were valued at $5,309 or $0.03 per share. The shares were issued to the vendor on April 19, 2021.

 

On May 21, 2021, the Company awarded 1,750,000 unregistered common shares, at $0.0231 per share, valued at $45,425, to the Company’s former COO as a bonus for services to the Company. The shares were issued on May 21, 2021 to the Company’s former COO.

 

Item 3. Defaults Upon Senior Securities

 

None.

 

Item 4. Mine Safety Disclosures

 

Not applicable.

 

Item 5. Other Information

 

None.

 

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Item 6. Exhibits

 

Exhibit Number		Description
(3)		(i) Articles of Incorporation; (ii) By-laws
3.1		Articles of Incorporation (Incorporated by reference to our Registration Statement filed on Form S-1 on February 25, 2009).
3.2		By-laws (Incorporated by reference to our Registration Statement filed on Form S-1 on February 25, 2009)
3.3		Certificate of Amendment (Incorporated by reference to our Registration Statement filed on Form S-1 on February 25, 2009).
3.4		Articles of Merger (Incorporated by reference to our Current Report filed on Form 8-K on July 15, 2010).
3.5		Certificate of Change (Incorporated by reference to our Current Report filed on Form 8-K on July 15, 2010).
3.6		Articles of Merger (Incorporated by reference to our Current Report filed on Form 8-K on June 25, 2018).
(10)		Material Contracts
10.1		2011 Stock Option Plan (incorporated by reference to our Current Report filed on Form 8-K on November 14, 2011).
10.2		Foxglove Promissory Note dated June 28, 2015 (incorporated by reference to our Quarterly Report filed on Form 10-Q on October 14, 2015).
10.3		$7,000 Convertible Promissory Note dated October 15, 2015 issued to Consorcio Empresarial Vesubio SA (incorporated by reference to our Quarterly Report filed on Form 10-Q on October 14, 2015).
10.4		Assignment Agreement dated effective August 7, 2018 between Oriental Rainbow Group Ltd. and Century Cobalt Corp. (incorporated by reference to our Current Report filed on Form 8-K on August 14, 2018).
10.5		Consulting Agreement with Alexander Stanbury, dated September 14, 2018. (incorporated by reference to Exhibit 10.10 to our Quarterly Report filed on Form 10-Q on October 22, 2018).
10.6		Consulting Agreement with Lester Kemp, dated September 11, 2018. (incorporated by reference to Exhibit 10.11 to our Quarterly Report filed on Form 10-Q on October 22, 2018).
10.7		On September 14, 2019, the Company entered a consulting agreement with Mathew McGahan for Business Development including other management advisory services (incorporated to our Annual Report filed on Form 10-K/A on May 11, 2021).
31.1*		Certification pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 of the Principal Executive Officer, Principal Financial Officer and Principal Accounting Officer.
(32)		Section 1350 Certifications
32.1*		Certification pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 of the Principal Executive Officer, Principal Financial Officer and Principal Accounting Officer.
101*		Interactive Data File
101.INS		XBRL Instance Document
101.SCH		XBRL Taxonomy Extension Schema Document
101.CAL		XBRL Taxonomy Extension Calculation Linkbase Document
101.DEF		XBRL Taxonomy Extension Definition Linkbase Document
101.LAB		XBRL Taxonomy Extension Label Linkbase Document
101.PRE		XBRL Taxonomy Extension Presentation Linkbase Document

 

* Filed herewith.

 

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SIGNATURES

 

Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

 

	CENTURY COBALT CORP.
	(Registrant)
Dated: June 29, 2021	/s/ Alexander Stanbury
	Alexander Stanbury
	President, Chief Executive Officer, Treasurer, Secretary and Director
	(Principal Executive Officer, Principal Financial Officer and Principal Accounting Officer)

 

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