UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, DC 20549

FORM 10-Q

☒ Quarterly Report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

For the quarterly period ended September 30, 2020

☐ Transition Report pursuant to 13 or 15(d) of the Securities Exchange Act of 1934

For the transition period _____________to______________

Commission File Number: 000-53565

BLOX, INC.

(Exact name of registrant as specified in its charter)

Nevada		20-8530914
(State or other jurisdiction of		(I.R.S. Employer
incorporation of organization)		Identification No.)

5th Floor, 1177 Avenue of Americas, New York		NY 10036
(Address of principal executive offices)		(ZIP Code)

Registrant’s telephone number, including area code: (604) 314-9293


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

Indicate by check mark whether the issuer (1) 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 and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). ☒ Yes ☐ No

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, 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	☐	Accelerated filer	☐
Non-accelerated filer	☐	Small 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. ☐

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

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). ☐ Yes ☒ No

State the number of shares outstanding of each of the issuer’s classes of common equity, as of the latest practicable date: 264,541,664 shares of common stock as of November 20, 2020.

Transitional Small Business Disclosure Format ☐ Yes ☒ No

BLOX, INC.

Quarterly Report on Form 10-Q

For The Quarterly Period Ended

September 30, 2020

INDEX

PART I - FINANCIAL INFORMATION	2
Item 1. Financial Statements	2
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations	17
Item 3. Quantitative and Qualitative Disclosures About Market Risk	22
Item 4. Controls and Procedures	22
PART II - OTHER INFORMATION	23
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	23
Item 4. Mine Safety Disclosure	23
Item 5. Other Information	23
Item 6. Exhibits	24
SIGNATURES	25

PART I

As used in this quarterly report on Form 10-Q, the terms “we”, “us” “our”, the “Company” or the “registrant” refer to Blox, Inc., a Nevada corporation, and its wholly-owned subsidiaries.

Our financial statements are stated in United States Dollars (US$) unless otherwise stated and are prepared in accordance with United States Generally Accepted Accounting Principles.

In this quarterly report, unless otherwise specified, all references to “common shares” refer to the common shares in our capital stock.

Forward-Looking Statements

This quarterly report contains “forward-looking statements”. All statements other than statements of historical fact are “forward-looking statements” for purposes of federal and state securities laws, including, but not limited to, any projections of earnings, revenue or other financial items; any statements of the plans, strategies and objections of management for future operations; any statements concerning proposed new services or developments; any statements regarding future economic conditions or performance; any statements or belief; and any statements of assumptions underlying any of the foregoing.

Forward-looking statements may include the words “may,” “could,” “estimate,” “intend,” “continue,” “believe,” “expect” or “anticipate” or other similar words. These forward-looking statements present our estimates and assumptions only as of the date of this report. Accordingly, readers are cautioned not to place undue reliance on forward-looking statements, which speak only as of the dates on which they are made. Except as required by applicable law, including the securities laws of the United States, we do not intend, and undertake no obligation, to update any forward-looking statement.

Although we believe the expectations reflected in any of our forward-looking statements are reasonable, actual results could differ materially from those projected or assumed in any of our forward-looking statements. Our future financial condition and results of operations, as well as any forward-looking statements, are subject to change and inherent risks and uncertainties. The factors impacting these risks and uncertainties include, but are not limited to:

●

our current lack of working capital;

●

our ability to obtain any necessary financing on acceptable terms;

●

timing and amount of funds needed for capital expenditures;

●

timely receipt of regulatory approvals;

●

our management team’s ability to implement our business plan;

●

effects of government regulation;

●

general economic and financial market conditions;

●

our ability to secure exploration permits for our prospective properties in Ghana;

●

our ability to develop our green mining business in Africa; and

●

the fact that our accounting policies and methods are fundamental to how we report our financial condition and results of operations, and they may require our management to make estimates about matters that are inherently uncertain.

PART I - FINANCIAL INFORMATION

Item 1. Financial Statements

The following unaudited interim consolidated financial statements of Blox, Inc. are included in this quarterly report on Form 10-Q.

Blox, Inc.

Condensed Interim Consolidated Balance Sheets

(Unaudited – Expressed in U.S. Dollars)

	As At			As At
	September 30, 2020			March 31, 2020
				(Audited)

ASSETS
Current Assets
Cash and cash equivalent	$	18,036		$	27,551
Prepaid expenses		11,167			5,167
Total Current Assets		29,203			32,718

Long term investments (Note 4)		146,192			61,091
Equipment (Note 5)		71,560			71,560
Total Assets	$	246,955		$	165,369

LIABILITIES
Current Liabilities
Accounts payable and accrued liabilities (Note 12)	$	295,771		$	294,379
Due to shareholder (Note 9)		391,214			391,214
Loan payable		428			-
Convertible debenture (Note 10)		61,130			120,480
Loan interest payable (Note 10)		5,129			4,706
Total Liabilities		753,672			810,779

STOCKHOLDERS’ DEFICIENCY
Common Stock (Note 7) - 400,000,000 authorized - 264,541,664 issued (March 31, 2020 – 144,647,664)		2,527			1,328
Additional Paid-in Capital		7,636,122			7,382,603
Contributed Surplus		27,213,786			27,279,356
Deficit		(35,359,152	)		(35,308,697	)
Total Stockholders’ Deficiency		(506,717	)		(645,410	)
Total Liabilities and Stockholders’ Deficiency	$	246,955		$	165,369

See accompanying notes to the condensed interim consolidated financial statements.

Blox, Inc.

Condensed Interim Consolidated Statements of Comprehensive Loss

(Unaudited - Expressed in U.S. Dollars)

	Three Months Ended						Six Months Ended
	September 30, 2020			September 30, 2019			September 30, 2020			September 30, 2019

Operating Expenses
Consulting and professional fees (Note 12)	$	21,033		$	42,997		$	43,824		$	77,502
Default penalties (Note 7)		-			-			35,000			-
Exploration (Note 6)		-			10,408			-			35,513
Foreign exchange		4,140			964			9,218			2,741
Office and administration fees		12,165			15,772			19,933			21,520
Travel		-			(263	)		-			-
Total Operating Expenses		(37,338	)		(69,878	)		(107,975	)		(137,276	)

Other Expenses
Interest expenses (Note 10)		(1,507	)		(626	)		(2,390	)		(626	)
Loss on investment in warrants		-			(65,507	)		-			(20,854	)
Accretion (Note 10)		(9,130	)		(16,788	)		(18,391	)		(16,788	)
Debt issuance cost – cash (Note 10)		-			(10,000	)		(6,800	)		(10,000	)
Unrealized gain (loss) on investment in common shares (Note 4)		34,899			(100,113	)		85,101			(31,837	)
Net Income (Loss) and Comprehensive Income (Loss) for the Period	$	(13,076	)	$	(262,912	)	$	(50,455	)	$	(217,381	)

Income (Loss) Per Common Share	$	0.00		$	(0.00	)	$	(0.00	)	$	(0.00	)
Weighted Average Number of Shares Outstanding – Basic and diluted		264,541,664			143,001,468			235,943,970			142,912,555

See accompanying notes to the condensed interim consolidated financial statements.

Blox, Inc.

Consolidated Statements of Changes in Stockholders’ Equity (Deficiency)

Six Months ended September 30, 2020 and 2019

(Expressed in U.S. Dollars)

	Common Stock				Additional Paid-in		Contributed						Total Stockholders’ Equity
	Shares		Amount		Capital		Surplus			Deficit			(Deficiency)

April 1, 2019		142,822,664	$	1,309	$	7,337,352	$	15,658,030		$	(22,414,509	)	$	582,182
Net income for the period		-		-		-		-			45,531			45,531
June 30, 2019		142,822,664		1,309		7,337,352		15,658,030			(22,368,978	)		627,713
Commitment shares issued		300,000		1		13,838		-			-			13,839
Warrants exercised		50,000		1		3,744		(1,245	)		-			2,500
Warrants issued		-		-		-		50,867			-			50,867
Convertible debenture - equity portion		-		-		-		46,638			-			46,638
Net loss for the period		-		-		-		-			(262,912	)		(262,912	)
September 30, 2019		143,172,664	$	1,311	$	7,354,934	$	15,754,290		$	(22,631,890	)	$	478,645

April 1, 2020		144,647,664	$	1,328	$	7,382,603	$	27,279,356		$	(35,308,697	)	$	(645,410	)
Warrants exercised (Note 7)		32,894,589		329		50,537		(50,866	)		-			-
Convertible debenture – equity portion (Note 10)		-		-		-		25,000			-			25,000
Convertible debenture -converted to shares (Note 10)		66,999,411		670		168,182		(39,704	)		-			129,148
Convertible debenture – default penalty shares (Note 7)		20,000,000		200		34,800		-			-			35,000
Net loss for the period		-		-		-		-			(37,379	)		(37,379	)
June 30, 2020		264,541,664		2,527		7,636,122		27,213,786			(35,346,076	)		(493,641	)
Net income for the period		-		-		-		-			(13,076	)		(13,076	)
September 30, 2020		264,541,664	$	2,527	$	7,636,122	$	27,213,786		$	(35,359,152	)	$	(506,717	)

See accompanying notes to the condensed interim consolidated financial statements.

Blox, Inc.

Condensed Interim Consolidated Statements of Cash Flows

(Unaudited – Expressed in U.S. Dollars)

	Six Months Ended
	September 30, 2020			September 30, 2019
CASH PROVIDED BY (USED IN):
OPERATING ACTIVITIES
Net loss for the period	$	(50,455	)	$	(217,381	)
Non-cash items:
Loss on investment in warrants		-			20,854
Unrealized (gain) loss on investment in common shares		(85,101	)		31,837
Default penalties		35,000			-
Accretion		18,391			16,788
Interest accrued on convertible debenture		2,390			626
Convertible debenture transaction costs		6,800			-
Changes in non-cash working capital:
Prepaid expenses		(6,000	)		(6,000	)
Accounts payable and accrued liabilities		1,460			16,343
Due to shareholder		-			60,593
		(77,515	)		(76,340	)

FINANCING ACTIVITIES
Proceeds from convertible debenture		74,800			150,000
Convertible debenture transaction costs		(6,800	)		(15,000	)
Warrants exercised		-			2,500
		68,000			137,500

(Decrease) Increase in Cash		(9,515	)		61,160
Cash, Beginning of Period		27,551			9,792
Cash, End of Period	$	18,036		$	70,952

Supplemental disclosure of cash flow information
Cash paid for interest	$	-		$	-
Cash paid for taxes	$	-		$	-
Issuance of common stock for loan interest payable	$	1,607		$	-

See accompanying notes to the condensed interim consolidated financial statements.

Blox, Inc.

Notes to Condensed Interim Consolidated Financial Statements

Six Months Ended September 30, 2020 and 2019

(Unaudited – Expressed in U.S. Dollars)

Description of Business

Blox, Inc. (the “Company”) was incorporated on July 21, 2005 under the laws of the state of Nevada. The address of the Company is #1177 Avenue of Americas 5th Floor, New York, NY 10036.

The Company is primarily engaged in developing mineral exploration projects in Guinea, West Africa.

Basis of Presentation

(a)

Statement of Compliance

These condensed interim consolidated financial statements are presented in accordance with generally accepted accounting principles in the United States (“US GAAP”) and the rules and regulations of the Securities and Exchange Commission (“SEC”) and are expressed in U.S. dollars. The Company’s fiscal year-end is March 31.

(b)

Basis of Presentation

The condensed interim consolidated financial statements of the Company comprise the Company and its subsidiaries, Blox Energy Inc. and Blox Minerals Guinea. These condensed interim consolidated financial statements are prepared on the historical cost basis. These condensed interim consolidated financial statements have also been prepared using the accrual basis of accounting, except for cash flow information. In the opinion of management, all adjustments (including normal recurring ones), considered necessary for the fair statement of results have been included in these condensed interim consolidated financial statements. All intercompany balances and transactions have been eliminated upon consolidation. The interim results are not necessarily indicative of results for the full year ending March 31, 2021, or future operating periods. For further information, see the Company’s annual consolidated financial statements for the year ended March 31, 2020, including the accounting policies and notes thereto.

(c)

Reporting and Functional Currencies

The functional currency of an entity is the currency of the primary economic environment in which the entity operates. The functional currency of the parent company is the Canadian dollar (“CAD”) and the functional currency of the subsidiaries is the US dollar. The Company’s reporting currency is the US dollar.

Transactions:

Monetary assets and liabilities denominated in foreign currencies are translated into functional currencies of the Company and its subsidiaries using period end foreign currency exchange rates and expenses are translated using the exchange rate approximating those in effect on the date of the transactions during the reporting periods in which the expenses were transacted. Non-monetary assets and liabilities are translated at their historical foreign currency exchange rates. Gains and losses resulting from foreign exchange transactions are included in the determination of net income or loss for the period.

Blox, Inc.

Notes to Condensed Interim Consolidated Financial Statements

Six Months Ended September 30, 2020 and 2019

(Unaudited – Expressed in U.S. Dollars)

Basis of Presentation (continued)

(d)

Significant Accounting Judgments and Estimates

The preparation of these condensed interim consolidated financial statements requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements and reported amounts of expenses during the period. Actual outcomes could differ from these estimates. Revisions to accounting estimates are recognized in the period in which the estimate is revised and may affect both the period of revision and future periods.

In applying the Company’s accounting policies, management has made certain judgments that may have a significant effect on the condensed interim consolidated financial statements. Such judgments include the determination of the functional currencies and use of the going concern assumption.

Significant areas requiring the use of management estimates include assumptions and estimates relating to asset impairment analysis, share-based payments and warrants, and valuation allowances for deferred income tax assets.

(i)

Determination of Functional Currencies

In determining the Company’s functional currency, it periodically reviews its primary and secondary indicators to assess the primary economic environment in which the entity operates in determining the Company’s functional currencies. The Company analyzes the currency that mainly influences labor, material and other costs of providing goods or services which is often the currency in which such costs are denominated and settled. The Company also analyzes secondary indicators such as the currency in which funds from financing activities such as equity issuances are generated and the funding dependency of the parent company whose predominant transactional currency is the Canadian dollar. Determining the Company’s predominant economic environment requires significant judgment.

(ii)

Going Concern

These condensed interim consolidated financial statements have been prepared on a going concern basis, which assumes the Company will continue to realize its assets and discharge its liabilities in the normal course of business. The Company has incurred a net loss of $50,455 for the six months ended September 30, 2020 and has incurred cumulative losses since inception of $35,359,152 as at September 30, 2020.

These factors raise substantial doubt about the ability of the Company to continue as going concern. The continuation of the Company as a going concern is dependent upon the continued financial support from its shareholders, the ability of the Company to obtain necessary debt and/or equity financing to continue operations. These condensed interim consolidated financial statements do not include any adjustments to the recoverability and classification of recorded asset amounts and classification of liabilities that might be necessary should the Company be unable to continue as a going concern. Management of the Company has undertaken steps as part of a plan to sustain operations for the next fiscal year including plans to raise additional equity financing, control costs and reduce operating losses.

Recent Accounting Pronouncements

The Company has implemented all new accounting pronouncements that are in effect. These pronouncements did not have any material impact on the condensed interim consolidated financial statements unless otherwise disclosed, and the Company does not believe that there are any other new accounting pronouncements that have been issued that might have a material impact on its financial position or results of operations.

Blox, Inc.

Notes to Condensed Interim Consolidated Financial Statements

Six Months Ended September 30, 2020 and 2019

(Unaudited – Expressed in U.S. Dollars)

Long Term Investments

			Fair Value as at
			September 30,		March 31,
	Number		2020		2020
Common shares		3,333,333	$	112,455	$	46,993
		1,000,000		33,737		14,098
Total investment:			$	146,192	$	61,091

On March 28, 2018, the Company participated in a private placement offering by its strategic partner, Ashanti Sankofa Inc (TSX.V- ASI) (“Ashanti” or “ASI”), which shares the same management group and board of directors as the Company (Note 12). The Company purchased 3,333,333 units at CAD$0.03 per unit for a total cost of $77,510 (CAD$100,000). Each unit consists of one common share and one transferable share purchase warrant with each warrant entitling the holder to acquire one additional common share at a price of CAD$0.05 for a period of 24 months from the closing of the private placement. On the date of issuance, the Company determined the fair value of the common share and warrants to be $44,331 and $33,179, respectively.

On April 16, 2018, the Company participated in a private placement offering by Ashanti. The Company purchased 1,000,000 units at CAD$0.03 per unit for a total cost of $23,850 (CAD$30,000). Each unit consists of one common share and one transferable share purchase warrant with each warrant entitling the holder to acquire one additional common share at a price of CAD$0.05 for a period of 24 months from the closing of the private placement. On the date of issuance, the Company determined the fair value of the common share and warrants to be $13,420 and $10,430, respectively.

As at September 30, 2020, the fair value of common shares was $146,192 which resulted in an unrealized gain of $85,101 (2019 – unrealized loss of $31,837) that was recorded in profit or loss. The share purchase warrants of ASI expired during the year ended March 31, 2020.

In January 2016, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) 2016-01, “Financial Instruments – Overall: Recognition and Measurement of Financial Assets and Financial Liabilities.” ASU 2016-01 requires equity investments (except those accounted for under the equity method of accounting, or those that result in consolidation of the investee) to be measured at fair value with changes in fair value recognized in net income, requires public business entities to use the exit price notion when measuring the fair value of financial instruments for disclosure purposes, requires separate presentation of financial assets and financial liabilities by measurement category and form of financial asset, and eliminates the requirement for public business entities to disclose the method(s) and significant assumptions used to estimate the fair value that is required to be disclosed for financial instruments measured at amortized cost. These changes became effective for the fiscal year beginning April 1, 2018. The most significant change for the Company, once ASU 2016-01 was adopted, was the accounting treatment for long term investments that were classified as available-for-sale. The accounting treatment used for the Consolidated Financial Statements through fiscal 2018 was that the long term investments, classified as available-for-sale, were carried at fair value, with net unrealized holding gains and losses being excluded from earnings and reported as a separate component of Stockholders’ Deficiency until realized and the change in net unrealized holding gains and losses being reflected as comprehensive income (loss). Under ASU 2016-01, effective April 1, 2018, these long term investments continue to be measured at fair value, however, the changes in net unrealized holding gains and losses are now recognized through net income.

Blox, Inc.

Notes to Condensed Interim Consolidated Financial Statements

Six Months Ended September 30, 2020 and 2019

(Unaudited – Expressed in U.S. Dollars)

Equipment

	Machinery		Total
Cost
Balance at September 30 & March 31, 2020	$	232,620	$	232,620
Accumulated Depreciation
Balance at September 30 & March 31, 2020	$	161,060	$	161,060
Carrying amounts
As at September 30 & March 31, 2020	$	71,560	$	71,560

Machinery in the amount of $71,560 has not been placed into production and is not currently being depreciated.

Mineral Property Interest

The Company entered into a Deed of Assignment and Assumption Agreement dated July 24, 2014 (the “Assumption Agreement”) among Joseph Boampong Memorial Institute Ltd. (“JBMIL”) and Equus Mining Ltd. (“EML”), Burey Gold Guinee sarl (“BGGs”) and Burey Gold Limited (“BGL”) and, collectively with EML and BGGs, (the “Vendors”), pursuant to which the Company agreed to assume JBMIL’s right to acquire a 78% beneficial interest in the Mansounia Concession (the “Property”) from the Vendors. The Company exercised that right and acquired a 78% beneficial interest in the Property.

The Property lies in the southwest margin of the Siguiri Basin, in the Kouroussa Prefecture, Kankan Region, in Guinea, West Africa.

An exploration permit for the Property was granted by the Ministère des Mines et de la Géologie on August 20, 2013. As part of its due diligence, the Company obtained a legal opinion which confirmed that the license was in good standing at the time of acquisition. It is the Company’s intention to obtain an exploitation permit to allow the Company the right to mine and dispose of minerals for 15 years, with a possible 5-year extension. The Company has commenced work on the feasibility study required for obtaining this permit.

In consideration for the acquisition of the interest in the Property, the Company paid in cash $100,000 to BGL and $40,000 to EML and issued BGL and EML an aggregate of 6,514,350 shares of common stock of the Company (the “First Tranche Shares”), at a deemed price of $0.1765 per share, for an aggregate deemed value of $1,150,000. The First Tranche Shares were issued to BGL and EML in the proportions of 71.43% and 28.57%, respectively. For accounting purposes, the Company recorded the cash payment of $140,000, and $10,000 for an independent valuation of the Property. Additionally, $781,722 was capitalized to mineral property interests, being the fair value of the first tranche of shares. The fair value of the first tranche shares was based on the closing price of the Company’s shares on the OTCQB on July 24, 2014.

Within 14 days of commercial gold production being publicly declared from ore mined from the Property, the Company will issue BGL and EML a second tranche of shares of common stock of the Company (the “Second Tranche Shares”). The number of Second Tranche Shares to be issued shall be calculated by dividing $1,150,000 by the volume weighted average share price of the Company’s common stock over a 20-day period preceding the issuance date. The Second Tranche Shares shall be issued to BGL and EML in the proportions of 71.43% and 28.57%, respectively.

Blox, Inc.

Notes to Condensed Interim Consolidated Financial Statements

Six Months Ended September 30, 2020 and 2019

(Unaudited – Expressed in U.S. Dollars)

Mineral Property Interest (continued)

The exploration license, which was originally granted on August 20, 2013, was extended by the Company until January 30, 2020, pending the results of its application for a mining license for the property (first submitted December 7, 2018). On February 17, 2020, the Company received notice from Minister of Mines and Geology, Republic of Guinea, revoking the Company’s exploration license for the Mansounia Gold Project. As a result of the revocation of the Company’s exploration license, all rights held by the Company and its partners in the Mansounia Gold Project have been terminated. The Company has since confirmed that its mining license application cannot proceed without a valid exploration license, and that it is ineligible to re-apply for an exploration license due to the expiration of its previous license. At March 31, 2020, management decided to write off the mineral property interest.

	Mansounia Property, West Africa
Acquisition of mineral property interest
Cash payment	$	150,000
Issuance of 6,514,350 common shares		781,722
Write-off mineral property interest		(931,722	)
Balance, March 31 & September 30, 2020	$	-

During the six months ended September 30, 2020, the Company spent $Nil (2019 – $35,513) on the property.

Common Stock

(a)

Private Placement

Year ended March 31, 2020

There were no shares issued from private placement for the year ended March 31, 2020.

Six months ended September 30, 2020

There were no shares issued from private placement for the six months ended September 30, 2020.

(b)

Convertible debenture shares issuance

Year ended March 31, 2020

On August 16, 2019, the Company issued 300,000 commitment shares to two convertible debenture holders. The fair value of the common shares was $60,000 (Note 10).

In March 2020, $22,300 principal of convertible debenture was converted to 1,475,000 common shares of the Company at price range of $0.03 to $0.17 (Note 10).

Six Months ended September 30, 2020

From April 1 to June 30, 2020, $127,273 principal of convertible debenture was converted to 66,999,411 common shares of the Company at a price range of $0.01 to $0.02 (Note 10).

On May 28, 2020, the Company received a notice from one convertible debenture holder that $17,500 of default penalty will be converted into 10,000,000 shares. On June 1, 2020, the 10,000,000 common shares were issued to settle the default penalty of $17,500. The penalty incurred is due to the loss of Mansounia property.

On June 8, 2020, the Company received a notice from one convertible debenture holder that $17,500 of default penalty will be converted into 10,000,000 shares. On June 8, 2020, the 10,000,000 common shares were issued to settle the default penalty of $17,500.

Blox, Inc.

Notes to Condensed Interim Consolidated Financial Statements

Six Months Ended September 30, 2020 and 2019

(Unaudited – Expressed in U.S. Dollars)

Common Stock (continued)

(c)

Warrants

Year ended March 31, 2020

On August 7, 2019, 50,000 warrants were exercised for common shares at $0.05 per share.

On August 16, 2019, the Company issued 1,111,110 warrants to two convertible debenture holders with a fair value of $220,541 (Note 10). On the issuance date of the warrants, the share price was $0.20. The warrants expire five years from the date of issuance and are exercisable at $0.135 per share. The fair value of these warrants was determined with the Black-Scholes option pricing model using the following assumptions: risk free interest rate of 1.57%, volatility of 231.6%, annual rate of dividend of 0%, and expected life of 5 years.

On February 27, 2020, the Company extended the term of 88,000,000 share purchase warrants from February 27, 2020 to February 27, 2021, no other terms were changed.

Six months ended September 30, 2020

On May 7, 2020, the Company entered into an Amendment #1 with one convertible debenture holder that the 555,555 warrant shares issued on August 16, 2019 are subject to anti-dilution protection. The Company agreed that the number of warrant shares should be equal to 10,000,000. On May 13, 2020, the convertible debt holder exercised 10,000,000 warrants to common shares via cashless exercise.

On May 28 and June 8, 2020, the Company received an Exercise Notice from another convertible debenture holder that 10,844,805 and 12,049,784 warrant shares were exercised to common shares via cashless exercise.

The 1,111,110 warrants were cancelled on June 8, 2020 due to the warrant shares that were issued.

The following table summarizes historical information about the Company’s warrants:

	Number of Warrants			Weighted Average Exercise Price ($)		Weighted Average Life Remaining (Years)

Balance, March 31, 2020		118,604,860			0.05		1.41
Warrants issued		32,894,589			0.001		-
Warrants exercised		(32,894,589	)		0.001		-
Warrants cancelled		(1,111,110	)
Balance, September 30, 2020		117,493,750			0.05		0.96

As at September 30, 2020, the following warrants were outstanding and exercisable:

Number of Warrants		Exercise Price		Expiry Date

	87,543,750	$	0.05	February 27, 2021
	29,950,000	$	0.05	April 24, 2023
	117,493,750

Blox, Inc.

Notes to Condensed Interim Consolidated Financial Statements

Six Months Ended September 30, 2020 and 2019

(Unaudited – Expressed in U.S. Dollars)

Common Stock (continued)

(d)

Stock Options

Year ended March 31, 2020

650,000 options expired on August 7, 2019.

Six months ended September 30, 2020

1,500,000 options were cancelled on May 27, 2020 due to the optionee no longer being an officer of the Company. There were no stock options granted for the six months ended September 30, 2020.

The following table summarizes historical information about the Company’s incentive stock options:

	Number of options			Weighted Average Exercise Price ($)		Weighted Average Life Remaining (Years)

Balance, March 31, 2020		1,500,000			0.27		2.90
Cancelled		(1,500,000	)		0.27
Balance, September 30, 2020		-			-		-

At September 30, 2020, there were no stock options outstanding.

Blox, Inc.

Notes to Condensed Interim Consolidated Financial Statements

Six Months Ended September 30, 2020 and 2019

(Unaudited – Expressed in U.S. Dollars)

Fair Value of Financial Instruments

The following provides an analysis of financial instruments that are measured subsequent to initial recognition at fair value, grouped into Levels 1 to 3 and based on the degree to which fair value is observable:

Level 1 – fair value measurements are those derived from quoted prices (unadjusted) in active markets for identical assets or liabilities;

Level 2 – fair value measurements are those derived from inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly (i.e. as prices) or indirectly (i.e. derived from prices); and

Level 3 – fair value measurements are those derived from valuation techniques that include inputs for the asset or liability that are not based on observable market data (unobservable inputs).

Level 2 and 3 financial instruments are measured using management’s best estimate of fair value, where the inputs into the determination of fair value require significant management judgment to estimation. Valuations based on unobservable inputs are highly subjective and require significant judgments. Changes in such judgments could have a material impact on fair value estimates. In addition, since estimates are as of a specific point in time, they are susceptible to material near-term changes. Changes in economic conditions may also dramatically affect the estimated fair values.

The following table sets forth the Company’s financial assets measured at fair value by level within the fair value hierarchy:

	Level 1		Level 2		Level 3		Total September 30, 2020
Cash and cash equivalent	$	18,036	$	-	$	-	$	18,036
Long-term investment – Shares		146,192		-		-		146,192
Total	$	164,228	$	-	$	-	$	164,228

	Level 1		Level 2		Level 3		Total March 31, 2020
Cash and cash equivalent	$	27,551	$	-	$	-	$	27,551
Long-term investment – Shares		61,091		-		-		61,091
Total	$	88,642	$	-	$	-	$	88,642

The following table sets forth the Company’s financial liabilities measured at fair value by level within the fair value hierarchy:

	Level 1		Level 2		Level 3		Total September 30, 2020
Accounts payable	$	295,771	$	-	$	-	$	295,771
Due to shareholder	$	391,214	$	-	$	-	$	391,214
Loan payable	$	428	$	-	$	-	$	428
Convertible debt	$	61,130	$	-	$	-	$	61,130
Total	$	748,543	$	-	$	-	$	748,543

	Level 1		Level 2		Level 3		Total March 31, 2020
Accounts payable	$	294,379	$	-	$	-	$	294,379
Due to shareholder	$	391,214	$	-	$	-	$	391,214
Loan payable	$	-	$	-	$	-	$	-
Convertible debt	$	120,480	$	-	$	-	$	120,480
Total	$	806,073	$	-	$	-	$	806,073

Blox, Inc.

Notes to Condensed Interim Consolidated Financial Statements

Six Months Ended September 30, 2020 and 2019

(Unaudited – Expressed in U.S. Dollars)

Due to Shareholder

During the period ended September 30, 2020, the Company received advances from Waratah Capital Ltd. (“Waratah”), a controlling shareholder of the Company, in the amount of $Nil (year ended March 31, 2020 - $61,868). As at September 30, 2020, the Company was indebted to Waratah for $391,214 (March 31, 2020 - $391,214). The advances from shareholder are unsecured, non-interest bearing and have no fixed repayment terms.

10.

Convertible Debenture

Year ended March 31, 2020

On August 16, 2019, the Company entered into security purchase agreements with two private investors, issuing two convertible promissory notes in an aggregate principal amount of $150,000, with a $15,000 original issue discount and $10,000 in legal fees, paid in cash to the investors and the legal counsel. Each note accrues interest at an annual rate of 5% and is to be repaid nine months after the dates of actual funding received. The investors have rights to convert a portion, or all, of the principal amount plus interest of each note at a lowest conversion price of i) $0.09 (fixed conversion price); or ii) 50% multiplied by the lowest closing bid price of the Common Stock during the 25 consecutive trading day period immediately preceding the date of the respective conversion (alternative conversion price) into common shares of the Company after 180 days and prior to May 16, 2020.

In addition, the Company issued 300,000 commitment shares to the two investors with a fair value of $60,000 and 1,111,110 warrants with a fair value of $220,541. The two warrant holders are entitled to purchase up to 1,111,110 common shares of the Company at an exercise price of $0.135 with a 5-year expiry date (Note 7 (b) & (c))

Based on a discount factor of 66%, the debt portion of the promissory note was valued at $102,567 and the conversion feature portion of the notes was valued at $202,208. The conversion feature was valued using the Black Scholes model with the following assumptions: risk free interest rate of 1.61%, volatility of 100.01%, dividend rate of 0% and expected life of 9 months.

The net proceeds received by the Company were allocated to the convertible debt and associated financial instruments based on their relative fair values as below:

	Proceeds Allocation
Debt	$	23,656
Conversion feature		46,638
Warrants		50,867
Shares		13,839
Total proceeds	$	135,000

Blox, Inc.

Notes to Condensed Interim Consolidated Financial Statements

Six Months Ended September 30, 2020 and 2019

(Unaudited – Expressed in U.S. Dollars)

10.

Convertible Debenture (continued)

For the year ended March 31, 2020, $22,300 of debt principal was converted to 1,475,000 common shares of the Company at price range of $0.03 to $0.17 (Note 7 (b)).

Six months ended September 30, 2020

On June 8, 2020, the Company entered into security purchase agreements with a private investor, issuing one convertible promissory note in an aggregate principal amount of $74,800, with a $6,800 original issue discount, $500 in due diligence fees and $2,500 in legal fees, paid in cash to the investors and the legal counsel. Each note accrues interest at an annual rate of 8% and is to be repaid on June 8, 2021. The investors have rights to convert a portion, or all, of the principal amount plus interest at variable conversion price to Common Stock of the Company after 180 days and prior to June 8, 2021 (Note 14(c)).

For the period ended September 30, 2020, $127,541 debt principal was converted to 66,999,411 common shares of the Company at price range of $0.01 to $0.02 (Note 7 (b)). Accretion for the note was calculated as $18,391 (2019 - $16,788) and interest expense of $2,390 (2019 - $626) was recorded. As of September 30, 2020, $149,572 debt principal were converted to commons shares.

	September 30, 2020			March 31, 2020
Convertible debenture – beginning of the period	$	120,480		$	-
Debt proceeds received		74,800			23,656
Debt converted to common shares		(127,541	)		(20,753	)
Equity portion of convertible debenture		(25,000	)		-
Finance cost - accretion		18,391			117,577
Carrying value – end of the period	$	61,130		$	120,480

The total principal value of the convertible debenture as at September 30, 2020 is $74,800 (March 31, 2020 - $150,000) As at September 30, 2020 $5,129 (March 31, 2020 - $4,706) of interest is accrued in relation to the convertible debenture.

11.

Commitments

On June 22, 2013, the Company entered into a share purchase agreement with Waratah Capital Ltd. (“Waratah”) where the Company agreed to purchase all of Waratah’s right, title, and interest in the Quivira Gold (“Quivira”) shares, of which Waratah holds 100% of the outstanding shares. As consideration for the Quivira shares, the Company will issue to Waratah 60,000,000 shares of common stock and 60,000,000 warrants. Each warrant entitles the holder to purchase one additional common share at $0.05 for a period of five years from the closing date. Quivira, a subsidiary of Waratah Investments, owns and operates gold and diamond mining properties in Ghana.

The closing of the agreement is subject to the completion of due diligence and the completion of a private placement for $1,500,000. The private placement closed during the year ended March 31, 2019. As of the issuance date of these financial statements, the due diligence has not yet been completed.

Blox, Inc.

Notes to Condensed Interim Consolidated Financial Statements

Six Months Ended September 30, 2020 and 2019

(Unaudited – Expressed in U.S. Dollars)

12.

Related Party Transactions

The Company’s related parties include its key management personnel, controlling shareholders, and strategic partner. Transactions with related parties for goods and services are based on the exchange amount as agreed to by the related parties.

The Company incurred the following expenses with related parties during the six months ended September 30, 2020 and 2019:

	Six Months Ended September 30,
	2020		2019
Compensation – CEO	$	25,740	$	27,000
Compensation – Former Officer		-		14,841
	$	25,740	$	41,841

As at September 30, 2020, the Company was indebted to its related parties for the amounts as below:

	September 30, 2020		March 31, 2020

Accounts payable and accrued liabilities	$	141,117	$	122,651
Due to shareholder (Note 9)		391,214		391,214
Investment in related party (Note 4)		146,192		61,091

These amounts owing are unsecured, non-interest bearing and have no fixed repayment terms.

13.

Geographical Area Information

	Canada		Africa		Total

September 30, 2020:

Current assets	$	26,841	$	2,362	$	29,203
Long term investments		162,435		-		162,435
Equipment		-		71,560		71,560
Total assets	$	189,276	$	73,922	$	263,198

Total liabilities	$	654,875	$	98,797	$	753,672

March 31, 2020:

Current assets	$	30,575	$	2,143	$	32,718
Long term investments		61,091		-		61,091
Equipment		-		71,560		71,560
Total assets	$	91,666	$	73,703	$	165,369

Total liabilities	$	718,237	$	92,545	$	810,779

14.

Subsequent Events

(a)

On October 8, 2020, the Company’s common shares was removed from OTCQB and demoted to the OTC Pink reporting tier due to OTCQB bid price deficiency.

(b)

On October 8, 2020, the Company received $92,040 in cash from a significant shareholder by issuing a one-year convertible promissory note with interest at 8% per annum.

(c)

On October 9, 2020, the Company terminated the convertible promissory issued on June 8, 2020 by paying the convertible promissory holder an aggregate amount of $92,042, including principal amount of $74,800, accrued interest $1,902 and prepayment penalty of $15,340.

Item 2.

Management’s Discussion and Analysis of Financial Condition and Results of Operations

The following discussion should be read in conjunction with our financial statements and the related notes that appear elsewhere in this quarterly report. The following discussion contains forward-looking statements that reflect our plans, estimates and beliefs. Our actual results could differ materially from those discussed in the forward-looking statements. Factors that could cause or contribute to such differences include those discussed below and elsewhere in this quarterly report on Form 10-Q.

Overview

We were incorporated in the State of Nevada on July 21, 2005, under the name “Nava Resources, Inc.” for the purpose of conducting mineral exploration activities. We were authorized to issue 400,000,000 shares of common stock, having a par value of $0.001 per share. On January 4, 2007, we obtained written consent from our shareholders to amend our Articles of Incorporation to change the par value of our common stock from $0.001 to $0.00001 per share, which change was effected on February 28, 2007. Effective July 30, 2013, we changed our name from “Nava Resources, Inc.” to “Blox, Inc.”.

On July 9, 2020, the Company received notice from OTC Markets Group that the closing bid price of our common shares has closed below $0.01 for more than 30 consecutive calendar days and no longer meets the Standards for Continued Eligibility for the OTCQB quotation tier as per the OTCQB Standards Section 2.3(2), which states that the Company must “maintain proprietary priced quotations published by a Market Maker in OTC Link with a minimum closing bid price of $0.01 per share on at least one of the prior thirty consecutive calendar days.”

As per Section 4.1 of the OTCQB Standards, the company will be granted a cure period of 90 calendar days during which the minimum closing bid price for the Company’s common stock must be $0.01 or greater for ten consecutive trading days in order to continue trading on the OTCQB marketplace. If the requirement is not met by October 7, 2020, the Company will be removed from the OTCQB marketplace and demoted to the OTC Pink reporting tier. In addition, if the Company’s closing bid price falls below $0.001 at any time for five consecutive trading days, the Company will be immediately removed from the OTCQB and demoted to the OTC Pink reporting tier. On October 8, 2020, the Company’s common shares started trading at OTC Pink sheet.

Recent Developments

Recently Discontinued Projects

Mansounia Property, Guinea, West Africa

Our former Mansounia exploration permit was acquired in 2013 and was secured based on our technical and financial capabilities to obtain a mining permit. The 2013 exploration permit was near expiration when acquired and was subsequently renewed for the maximum of four times permitted by the Guinea Mining Code. In December 2019, the Company submitted its final mining permit proposal to the Ministry of Mines. The ministry requested, in its discretion, that we provide evidence of funding to account for 15% of the capital required for project financing. The Company was unable to secure the required financing during prior to expiration of the final permit extension, and the permit was withdrawn by decree from the Ministry of Mines. Although it is our understanding the Ministry of Mines exercises considerable discretion regarding the extension and revocation of permits and the grant of mining licenses, the decree to revoke our exploration permit suggests that our application is no longer under consideration. With respect to the fate of the project, we anticipate that we will attempt to renegotiate a position for the Mansounia project once Guinea reopens its border to international travel (the country has been inaccessible due to COVID-19).

Current Business:

Pramkese, Osenase and Asamankese, Ghana, West Africa

On June 22, 2013, we entered into a share purchase agreement with Waratah Investments Limited (“Waratah”) whereby we agreed to purchase all of Waratah’s right, title, and interest in the Quivira Gold (“Quivira”) shares, of which Waratah holds 100% of the outstanding shares. As consideration for the Quivira shares, we agreed to issue to Waratah 60,000,000 shares of common stock and 60,000,000 warrants. Each warrant entitles the holder to purchase one additional common share at $0.05 for a period of five years from the closing date. Quivira, a subsidiary of Waratah, owns and operates gold and diamond mining properties in Ghana.

The closing of the agreement was subject to the completion of a private placement financing of up to US$1,500,000, which private placement was completed in April 2018. We issued 30,000,000 units (the “Units”) at a price of US$0.05 per unit for aggregate gross proceeds of US$1,500,000. US$1,100,000 of the proceeds were advanced as non-interest bearing loans since 2014 and were utilized to cover general and administrative expenses, as well as to carry out exploration work on our mineral properties. The remaining balance of US$400,000 was received by April 2018. Each Unit consists of one common share and one share purchase warrant entitling the holder thereof to purchase one additional common share at a price of $0.05 per share for a term of five years from the date of issuance.

Closing the Agreement is also conditional upon receiving legal opinions of Ghana counsel confirming various matters relating to the laws of Ghana, including corporate and title opinions; the Company receiving legal opinions of Australian counsel confirming various matters relating to the laws of Australia, including corporate and title opinions; completion of certain ongoing transactions by Quivira relating to the transfer of title to certain assets and to an assignment of debt; and preparation of U.S. GAAP consolidated financial statements for Quivira.

Our directors conducted their first visit to Ghana in August 2015, when they visited the Birim Region where the three Ghanaian concessions are located. The objective was to carry out a geological reconnaissance over the areas to identify potentially favourable lithologies. The directors inspected the existing field programs in Ghana and oversaw the planning and implementation of programs for the near future. Field work on the three concessions has since ceased and associated exploration permits have expired. Neither the Company nor Quivira holds any right title or claim to the concessions, but the Company endeavors to renew permits subject to securing sufficient financing. There is no guarantee that sufficient financing will be raise in a timely manner, if at all.

We intend to renew permits for three concessions in Ghana for their gold and diamond potential, and to explore the market for other viable assets. All three licences have expired and require an estimated $100,000 to renew. We are currently in discussions with with prospective equity investors to finance the renewal costs, however no agreement has been secured. Nevertheless, in order to secure necessary financing, we will be required to increase our authorized capital. The Asamankese, Osenase and Pramkese concessions are located near Asamankese, Akim Oda and Kade towns respectively. The concession is dominated by broad pene plain, dotted with moderate to high hills and remnant of rain forest. The area is hilly and rugged, running from 180m to 300m in elevation. Around the licences is the Atewa range about 1050m above sea level. There are little published records of extensive widely scattered gold mineralization old pits, shafts and adits, as well as artisanal gold workings in the concessions. In the mid-sixties, the Geological Survey Department of Ghana undertook reconnaissance mapping and soil geochemical survey in the area during which traces of gold were recorded in panned concentrates of geochemical samples.

Osenase

Osenase is in the Birim Central Municipal District. The nearest town to the project area is the District Capital Akim Oda. This project has seen limited amount of gold exploration. The concession was previously held by Cornucopia Resources in the 1990s and was engaged in potential for a diamond resource. Paramount Mining Corporation held the concession for almost 6 years with limited amount of work. The limited work done was focused on diamondiferous hard rock potential at Atiankama Nkwanta. The presence of diamonds in what appears to be an in-situ unit exposed by the Francis Pits at Atiakama Nkwanta provides an opportunity to explain the source of some of the diamonds in the region. S Two oriented grids were sampled in 2007 but were never analysed for gold. The samples have been stored at the Manso camp to be analysed later. No subsequent work has been carried out to establish gold or diamond potential, and there is no guarantee that ore is present in economically significant quantity.

Asamankese

Asamankese is a 150Km2 Prospecting License (PL) in the West Akim District. The nearest town to the project area is the District Capital Asamankese. Asamankese was originally part of Osenase under a reconnaissance licence. In 2006, about 4 soil-oriented grids on 800m x 50m was established and sampled. The samples were stored at the Manso camp to be analysed later. The samples are still in storage at the Manso camp. A total of 436 samples representing two of the gridlines L1600N and L2400N at 800m apart were later on analysed for gold. The samples were sent to SGS Tarkwa for 2kg BLEG analysis. Results received were not encouraging for gold, with only one modest spike of 170 ppb Au, associated with alluvials. A limited stream sediment program began in November 2008 but could not be completed due to financial constraints. About 108 stream sediment samples were collected and panned for visible gold out of a total 183 planned. No laboratory analysis was carried out. About 80 sample points are still yet to be sampled.

Pramkese

Pramkese is a 66 square kilometres Prospecting License (PL) in the Kwaebibirim District located in the Birim Diamond Field. The nearest town to the project area is the District Capital Kade. Limited reconnaissance work was carried out in 2009 and the licence was converted to a Prospecting Licence. The exercise concentrated on the south of the town of Pramkese. Ten (10) alluvial pits were dug and sampled. The samples collected were panned and hand jigged for gold and diamond respectively. In the early 90’s, a fair amount of work was done on the concession for both alluvial gold and diamond by Basogard. Basogard defined some alluvial gold and diamond resources which were never investigated.

The company is now in discussions with various potential partners to explore and define the potential of these concessions, however no definitive agreements have been reached. There is no guarantee that any agreements will be reached or that permits will be secured.

Going Concern

Our financial statements are prepared using generally accepted accounting principles in the United States of America applicable to a going concern, which contemplates the realization of assets and liquidation of liabilities in the normal course of business. We have not yet established an ongoing source of revenues sufficient to cover our operating costs and to allow us to continue as a going concern. We have incurred a net loss of $50,455 for the six months ended September 30, 2020, and have incurred cumulative losses since inception of $35,359,152. These factors raise substantial doubt about the ability of the Company to continue as going concern. Our ability to continue as a going concern is dependent on our ability to continue obtaining adequate capital to fund operating losses until we become profitable. If we are unable to obtain adequate capital, we could be forced to significantly curtail or cease operations.

We will need to raise additional funds to finance continuing operations. However, there are no assurances that we will be successful in raising additional funds. Without sufficient additional financing, it would be unlikely for us to continue as a going concern. Our ability to continue as a going concern is dependent upon our ability to successfully accomplish the plans described in this quarterly report and eventually secure other sources of financing and attain profitable operations.

Results of Operations

Three Months Ended September 30, 2020 and 2019

The net loss and comprehensive loss for the three months ended September 30, 2020 was $13,076 as compared to the net loss and comprehensive loss for three months ended September 30, 2019 of $262,912. Operating expenses for the 2^nd quarter totaled $37,338 compared to $69,878, in 2019 a decrease of $32,540. Some of the more items contributing to the net loss and comprehensive loss for the 2^nd quarter of 2020 and 2019 were as follows:

●

Exploration expenses of $Nil (2019 - $10,408). The Company currently will not involve the exploration activities due to the loss of Mansounia exploration license.

●

Consulting and professional fees of $21,033 (2019 - $42,997). The decrease is result of cutting back the management fees in the current quarter.

●

Loss on the investment in warrants of $Nil (2019 - $65,507). The fair value of warrants of ASI is $Nil in the current quarter due to the warrants expired.

●

Accretion of $9,130 (2019 - $16,788). The decrease in accretion is due to only one convertible note is still outstanding in the current quarter when compared to two convertible notes in 2019.

●

Unrealized gain on the investment in common shares of $34,899 (2019 - $100,113 unrealized loss). The unrealized gain is due to holding the investment in Ashanti Sankofa Inc’s (TSX.V-ASI)’ common shares. The market value of ASI’s common shares increased for the current quarter.

Six Months Ended September 30, 2020 and 2019

The net loss and comprehensive loss for the six months ended September 30, 2020 was $50,455 as compared to the net loss for the six months ended September 30, 2019 of $217,381. Operating expenses for two quarters totaled $107,975 compared to $137,276 in 2019 a decrease of $29,301. Some of the more items contributing to the net loss and comprehensive loss for two quarters of 2020 and 2019 were as follows:

●

Exploration expenses of $Nil (2019 - $35,513). The Company currently will not involve the exploration activities due to the loss of Mansounia exploration license.

●

Consulting and professional fees of $43,824 (2019 - $77,502). The decrease is result of cutting back the management fees in the current quarter.

●

Loss on the investment in warrants of $Nil (2019 - $20,854). The fair value of warrants of ASI is Nil in the current quarter due to the warrants expired.

●

Accretion of $18,391 (2019 - $16,788). The accretion of the convertible debenture was recognized in both 2020 and 2019.

●

Default penalties of $35,000 (2019 - $Nil). The Default penalties, a non-cash expense incurred is due to the loss of Mansounia property.

●

Unrealized gain on the investment in common shares of $85,101 (2019 - $31,837 unrealized loss). The unrealized gain is due to holding the investment in Ashanti Sankofa Inc’s (TSX.V-ASI)’ common shares. The market value of ASI’s common shares decreased for the current quarter.

Management anticipates operating expenses will materially increase in future periods as we focus on green mineral development and incur increased costs as a result of being a public company with a class of securities registered under the Securities Exchange Act of 1934.

Liquidity and Capital Resources

Working Capital

Continuing Operations	September 30, 2020			March 31, 2020
Current Assets	$	29,203		$	32,718
Current Liabilities		753,672			810,779
Working Capital Deficit	$	(724,469	)	$	(778,061	)

Current Assets

The nominal decrease in current assets as of September 30, 2020 compared to March 31, 2020 was primarily due to a decrease in cash from $27,551 to $18,036.

Current Liabilities

Current liabilities as at September 30, 2020 decreased by $57,107 since March 31, 2020, primarily due to the conversion of convertible debentures into common shares during the current quarters.

Cash Flow

Our cash flow was as follows:

	Six Months Ended September 30
	2020 $			2019 $
Net cash used in operating activities		(77,515	)		(76,340	)
Net cash used in investing activities		-			-
Net cash provided by financing activities		68,000			137,500
Decrease (increase) in cash and cash equivalents		(9,515	)		61,160

Operating activities

The increase in net cash used in operating activities for the six months ended September 30, 2020, compared to the same period in 2019 was primarily as a result of increased operating activities in the current quarter.

Investing activities

For the six months ended September 30, 2019 and 2020, there were no investing activities incurred.

Financing activities

There were convertible promissory notes issued in the six months ended September 30, 2020 and September 30, 2019.

Critical Accounting Policies

There have been no significant changes to the critical accounting policies as described in our Annual Form 10-K for the year ended March 31, 2020.

Cash Requirements

Our current cash position is not sufficient to meet our present and near-term cash needs. We will require additional cash resources, including the sale of equity or debt securities, to meet our planned capital expenditures and working capital requirements. For the next 12 months we estimate that our capital needs will be $500,000 to $750,000 and we currently have approximately $18,000 in cash. We will seek to sell additional equity or debt securities or obtain additional credit facilities. The sale of additional equity securities will result in dilution to our stockholders. The incurrence of indebtedness will result in increased debt service obligations and could require us to agree to operating and financial covenants that could restrict our operations or modify our plans to grow the business. Financing may not be available in amounts or on terms acceptable to us, if at all. Any failure by us to raise additional funds on terms favorable to us, or at all, will limit our ability to expand our business operations and could harm our overall business prospects.

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, capital expenditures or capital resources that is material to our stockholders.

Contractual Obligations

Not applicable.

Item 3.

Quantitative and Qualitative Disclosures About Market Risk

We are a smaller reporting company as defined by Rule 12b-2 of the Exchange Act and are not required to provide the information required under this item.

Item 4.

Controls and Procedures

Evaluation of Disclosure Controls and Procedures

We maintain “disclosure controls and procedures,” as such term is defined in Rule 13a-15(e) under the Securities Exchange Act of 1934 (the “Exchange Act”), that are designed to ensure that information required to be disclosed in our Exchange Act reports is recorded, processed, summarized and reported within the time periods specified in the Securities and Exchange Commission rules and forms, and that such information is accumulated and communicated to our management, including our Principal Executive Officer and Principal Financial Officer, as appropriate, to allow timely decisions regarding required disclosure. We conducted an evaluation under the supervision and with the participation of our Principal Executive Officer and Principal Financial Officer, of the effectiveness of the design and operation of our disclosure controls and procedures as of the end of the period covered by this report pursuant to Rule 13a-15 of the Exchange Act. Based on this Evaluation, our Principal Executive Officer and Principal Financial Officer concluded that our Disclosure Controls were effective as of the end of the period covered by this report.

Changes in Internal Control Over Financial Reporting

There were no changes in our internal controls that occurred during the quarter covered by this report that have materially affected, or are reasonably likely to materially affect our internal controls.

PART II - OTHER INFORMATION

Item 1.

Legal Proceedings

We are not a party to any pending legal proceeding. Management is not aware of any threatened litigation, claims or assessments.

Item 1A.

Risk Factors

We are a smaller reporting company as defined by Rule 12b-2 of the Exchange Act and are not required to provide the information required under this item.

Item 2.

Unregistered Sales of Equity Securities and Use of Proceeds

On September 29, 2017, the Company entered into an agreement with Waratah Capital Ltd. (“Waratah”), a controlling shareholder, whereby Waratah and the Company agreed that in order to allow the Company to finalize its acquisition of Quivira Gold Ltd. pursuant to the Share Purchase Agreement dated June 22, 2013 among the Company, Quivira Gold Ltd. and Waratah (the “Quivira Agreement”), the Bridge Loan Agreement dated as of April 17, 2015, and amended on April 28, 2016 and November 1, 2016 between the Company and Waratah would be cancelled and the Company will utilize the loan proceeds advanced to close a private placement of $1,500,000 required to consummate the Company’s acquisition of Quivira Gold Ltd.

On April 24, 2018, the Company closed the private placement as part of the Quivira acquisition and issued 30,000,000 units at a price of $0.05 per unit for gross proceeds of $1,500,000. Each unit consists of one common share and one transferable share purchase warrant exercisable at a price of $0.05 per share for a term of five years.

The above securities were issued to non-US persons (as that term is defined in Regulation S of the Securities Act of 1933), in offshore transactions relying on Regulation S of the Securities Act of 1933, as amended.

Item 3.

Defaults Upon Senior Securities

None.

Item 4.

Mine Safety Disclosure

Not applicable.

Item 5.

Other Information

On June 30, 2020, Ronald Renee was appointed as the Interim Chief Financial Officer the Company.

Item 6. Exhibits

Number		Exhibit Description
31.1		Certification of the Chief Executive Officer pursuant to Rule 13a-14 Or 15d-14 of the Securities Exchange Act Of 1934, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
31.2		Certification of the Chief Financial Officer pursuant to Rule 13a-14 Or 15d-14 of the Securities Exchange Act Of 1934, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
32.1		Certification of the Chief Executive Officer pursuant to 18 U.S.C. Section 1350 as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
32.2		Certification of the Chief Financial Officer pursuant to 18 U.S.C. Section 1350 as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
101 **		Interactive data files formatted in XBRL (eXtensible Business Reporting Language): (i) the Consolidated Balance Sheets, (ii) the Consolidated Statements of Operations, (iii) the Consolidated Statements of Cash Flows, and (iv) the Notes to the Consolidated Financial Statements.
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

XBRL (Extensible Business Reporting Language) information is furnished and not filed or a part of a registration statement or prospectus for purposes of Sections 11 or 12 of the Securities Act of 1933, as amended, is deemed not filed for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, and otherwise is not subject to liability under these sections.

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.

BLOX INC.

By:	/s/ Ronald Renee
Name:	Ronald Renee
Title:	Chief Executive Officer

Date:	November 20, 2020

Blox, Inc. 10-Q