What changed in this filing

/stocks — the workspaceLOADING

Item 8. Financial Statements and Supplementary Data

2026-03-31 compared with 2025-03-27 · 716 added, 461 removed, 722 unchanged (62% of the section changed)

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Our responsibility is to express an opinion on the Company’s financial statements based on our audits.

We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (the “PCAOB”) and are required to be independent with respect to the Company in accordance with the U.S.

We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (“PCAOB”) and are required to be independent with respect to the Company in accordance with the U.S.

federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

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We believe that our audits provide a reasonable basis for our opinion.

Critical Audit Matters

The critical audit matter communicated below is a matter arising from the current period audit of the financial statements that was communicated or required to be communicated to the audit committee and that:

(1) relates to accounts or disclosures that are material to the financial statements and (2) involved our especially challenging, subjective or complex judgments.

The communication of the critical audit matter does not alter in any way our opinion on the consolidated financial statements, taken as a whole, and we are not, by communicating the critical audit matter below, providing a separate opinion on the critical audit matter or on the account or disclosure to which it relates.

Valuation of royalty liability

Description of the Matter

At December 31, 2025, the fair value of the NORI D Royalty (“royalty liability”) was $130.0 million, as disclosed in Note 10 to the consolidated financial statements.

The royalty liability was recognized in accordance with ASC 470 Debt , and the Company measures the royalty liability at fair value through profit and loss at the end of each reporting period.

Specifically at December 31, 2025, the Company determined the fair value of the royalty liability using an income approach.

This required management to make significant assumptions with respect to the discount rate, future metal prices, production levels, repurchase options and certain operational matters that include permitting and project timelines.

Auditing management’s estimate of the fair value of the royalty liability was complex due to the significant estimation uncertainty and judgement applied by management in determining these significant assumptions.

This required the involvement of specialists.

How We Addressed the Matter in Our Audit

To test the fair value of the royalty liability we performed the following procedures, amongst others.

We involved valuation specialists to evaluate the discount rate against current industry and economic trends, compared future metal prices against market data, evaluated management’s sensitivity on the economics of triggering the repurchase options from a market participant’s perspective and performed sensitivity analyses over certain assumptions to assess the impact on the fair value.

We assessed the reasonableness of permitting assumptions and project timelines based on the latest available information, and tested the completeness, accuracy, and relevance of underlying data used in the Company’s models.

We involved our mining specialists to assist in evaluating the methods and assumptions used by management’s specialists to estimate production levels.

We also involved our mining specialists in evaluating the methods and assumptions employed by management regarding certain operational matters that form the basis of cash flow estimates, including permitting assumptions.

Further, we assessed the adequacy of the consolidated financial statement disclosures.

/s/ Ernst & Young LLP

Chartered Professional Accountants

We have served as the Company’s auditor since 2012.

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Receivables and prepayments

Exploration contracts

Exploration assets

Right of use asset

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Short-term debt

Warrants liability

Deferred tax liability

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422,966,333 (December 31, 2024 – 340,708,460 ))

Class A - J Special Shares

Additional paid - in capital

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Commitments and Contingent Liabilities (Note 22)

Subsequent Events (Note 25)

Subsequent Event (Note 25)

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

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Operating loss

Nauru and Tonga warrant costs

Change in fair value of royalty liability

Equity-accounted investment loss

Gain on dilution of investment

Loss on termination of contract

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Loss and comprehensive loss for the year

Loss per share - Basic and diluted

Loss per share

- Basic and diluted

Weighted average number of common shares outstanding – basic and diluted

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January 1, 2025

Shares and warrants issued under Registered Direct Offering, net of expenses (Note 13)

Adjustment to Class A Warrant (Note 15)

Issuance of shares and warrants to Korea Zinc (Notes 14, 16)

Issuance of shares and warrants under 2025 Registered Direct Offering, net of expenses (Notes 14, 16)

Issuance of shares and warrants under 2024 Registered Direct Offering, net of expenses (Notes 14, 16)

Shares issued from At-the-Market Equity Distribution Agreement (Note 15)

Exercise of Class A warrants (Note 16)

Exercise of Class B warrants (Note 16)

Exercise of Class C warrants (Note 16)

Conversion of restricted share units, net of shares withheld for taxes (Note 18)

Shares issued as per At-the-Market Equity Distribution Agreement (Note 14)

Exercise of stock options (Note 18)

Share purchase under Employee Share Purchase Plan (Note 17)

Share-based compensation and expenses settled with equity (Note 17)

Foreign currency translation adjustment

Loss for the year

Share purchases under Employee Stock Purchase Plan (Note 18)

Nauru and Tonga warrant cost (Note 16)

Share-based compensation and expenses settled with equity (Notes 11, 12, 18)

Loss for the period

December 31, 2025

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January 1, 2024

Shares issued to Allseas

Exercise of warrant by Allseas

Shares and warrants issued under 2024 Registered Direct Offering, net of expenses

Adjustment to Class A warrant

Conversion of restricted share units, net of shares withheld for taxes

Share purchase under Employee Share Purchase Plan

Shares issued as per At-the-Market Equity Distribution Agreement

Exercise of stock options

Share purchases under Employee Stock Purchase Plan

Share-based compensation and expenses settled with equity

Foreign currency translation adjustment

Loss for the year

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(in thousands of US Dollars)

For the year ended

For the year ended December 31,

Cash provided by (used in)

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Items not affecting cash:

Nauru and Tonga warrant costs

Lease expense

1 unchanged sentence

Share-based compensation and expenses settled with equity

Equity-accounted investment loss

Equity-accounted investment loss (gain)

Gain on dilution of investment

Change in fair value of royalty liability

Change in fair value of warrants liability

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Unrealized foreign exchange

Interest paid on Short-Term Debt

Interest paid on amounts drawn from credit facilities and short-term debt

Corporate income taxes paid during the year

Changes in working capital:

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Investing activities

Proceeds from investee distribution

Acquisition of equipment and software

Net cash used in investing activities

Net cash provided by (used in) investing activities

Financing activities

Proceeds from registered direct offering

Expenses paid for registered direct offering

Proceeds from Shares issued from ATM

Proceeds from Korea Zinc Private Placement

Proceeds from Registered Direct Offerings

Expenses paid for Registered Direct Offerings

Proceeds from shares issued from At-the-Market Distribution Agreement

Proceeds from exercise of Class A warrants

Proceeds from exercise of Class B warrants

Proceeds from exercise of Class C warrants

Proceeds from drawdown of Credit Facilities

Repayment of drawn amount on Credit Facilities

Proceeds from drawdown of Allseas Short-Term Debt

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Proceeds from drawdown of Allseas Working Capital Loan Agreement

Proceeds from Low Carbon Royalties Investment

Proceeds from employee stock plans

Repayment of Allseas Working Capital Loan

Proceeds from Employee Stock Purchase Plan

Proceeds from exercise of stock options

Proceeds from exercise of warrants by Allseas

Proceeds from issuance of shares

Net cash provided by financing activities

Decrease in cash

Increase/(Decrease) in cash

Impact of exchange rate changes on cash

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TMC the metals company Inc.

(“TMC” or the “Company”) has been operating as a corporation under the laws of the province of British Columbia, Canada since September 9, 2021.

(“TMC” or the “Company”) was incorporated as a Cayman Islands exempted company limited by shares on December 18, 2019.

On September 9, 2021, the Company completed its business combination with DeepGreen Metals Inc.

(“DeepGreen”), a Canadian - registered company founded in 2011, after which DeepGreen became a wholly - owned subsidiary and the combined company began operating as TMC the metals company Inc.

and continued as a corporation under the laws of the province of British Columbia, Canada on September 9, 2021.

The Company’s corporate office, registered address and records office is located at 1111 West Hastings Street, 15 th Floor, Vancouver, British Columbia, Canada, V6E 2J3.

The Company’s common shares and warrants to purchase common shares are listed for trading on the Nasdaq Global Select Market (“Nasdaq”) under tickers “TMC” and “TMCWW”, respectively.

The Company is a deep-sea minerals exploration company focused on the collection and processing of polymetallic nodules found on the seafloor in international waters of the Clarion Clipperton Zone in the Pacific Ocean (“CCZ”), located approximately 1,300 nautical miles southwest of San Diego, California.

These nodules contain four metals (nickel, copper, cobalt, manganese) which can be used as (i) feedstock for battery cathode precursors (nickel and cobalt sulfates, or intermediary nickel-copper-cobalt matte, or nickel-copper-cobalt alloy) for electric vehicles (“EV”) and energy storage markets, (ii) copper cathode for EV wiring, energy transmission and other applications and (iii) manganese silicate for manganese alloy production required for steel production.

Exploration and exploitation of seabed minerals in international waters is regulated by the International Seabed Authority (“ISA”), an intergovernmental organization established pursuant to the 1994 Agreement Relating to the Implementation of the United Nations Convention on the Law of the Sea.

The ISA grants contracts to sovereign states or to private contractors who are sponsored by a sovereign state.

The Company’s wholly owned subsidiary, Nauru Ocean Resources Inc.

(“NORI”), was granted an exploration contract (the “NORI Exploration Contract”) by the ISA in July 2011 under the sponsorship of the Republic of Nauru (“Nauru”) giving NORI exclusive rights to explore for polymetallic nodules in an area covering 74,830 square kilometers in the CCZ (“NORI Area”).

On March 31, 2020, the Company acquired Tonga Offshore Mining Limited (“TOML”), which was granted an exploration contract (the “TOML Exploration Contract”) by the ISA in January 2012 under the sponsorship of the Kingdom of Tonga (“Tonga”) and has exclusive rights to explore for polymetallic nodules covering an area of 74,713 square kilometers in the CCZ (“TOML Area”).

In 2013, the Company through its subsidiary DeepGreen Engineering Pte.

(“DGE”) entered into an option agreement (the “Marawa Option Agreement”) with Marawa Research and Exploration Limited (“Marawa”) which granted DGE exclusive rights to manage and carry out all exploration and exploitation in the Marawa Area in return for a royalty payable to Marawa.

On November 14, 2024, DGE issued a formal termination notice to Marawa pursuant to DGE’s right to terminate for convenience under the Agreement.

The termination became effective on January 14, 2025.

The Company is a deep seabed minerals developer focused on the collection, processing and refining of polymetallic nodules found on the seafloor in international waters of the Clarion Clipperton Zone in the Pacific Ocean (“CCZ”), with NORI Area D located approximately 1,500 miles (or 2,400 kilometers) southwest of San Diego, California.

These nodules contain high grades of four metals (nickel, copper, cobalt, manganese) and rare earth elements (REE) which will initially be transformed into nickel, cobalt and copper-bearing intermediate and metal cathode products as well as a manganese silicate product of approximately 40% manganese comparable to medium-grade manganese ore.

Once in production, the Company will explore expanding into other product formats including silicomanganese alloy, battery-grade sulfates and precursor Cathode Active Materials (pCAM), as well as extracting REEs contained in nodules.

On April 28, 2025, the Company’s wholly owned subsidiary, The Metals Company USA, LLC (“TMC USA”), formally submitted applications for two exploration licenses and one commercial recovery permit to the National Oceanic and Atmospheric Administration (“NOAA”) pursuant to the Deep Seabed Hard Mineral Resources Act of 1980 (“DSHMRA”).

The submitted exploration license applications are to secure exploration rights over two areas in the CCZ, namely TMC USA-A and TMC USA-B, covering a total area of 187,017 square kilometers.

The submitted commercial recovery permit application is to secure commercial recovery rights for a subset of the TMC USA-A area covering over 25,160 square kilometers.

The commercial recovery application is the first submission under DSHMRA for commercial recovery of polymetallic nodules.

On January 22, 2026, TMC USA formally submitted a consolidated application to NOAA for an exploration license and a commercial recovery permit for polymetallic nodules in the CCZ.

The application was filed under NOAA’s new consolidated application and review process.

The consolidated application covers approximately 65,000 km 2 exploration and commercial recovery area in the CCZ, compared to a commercial recovery area of 25,160 km 2 in TMC USA’s initial commercial recovery permit application filed in April 2025.

Two of the Company’s wholly owned subsidiaries, Nauru Ocean Resources Inc.

(“NORI”) and Tonga Offshore Mining Limited (TOML) continue to hold and comply with the terms of their exploration contracts granted by the International Seabed Authority (ISA).

The realization of the Company’s assets and attainment of profitable operations is dependent upon many factors including, among other things:

financing being arranged by the Company to continue operations, development of a nodule collection system for the recovery of polymetallic nodules from the seafloor as well as development of processing technology for the treatment of polymetallic nodules at commercial scale, the establishment of mineable reserves, the commercial and technical feasibility of seafloor polymetallic nodule collection and processing, metal prices, and regulatory approvals and environmental permitting for commercial operations.

financing being arranged by the Company to continue the scaling of the nodule collection system for the recovery of polymetallic nodules from the seafloor and the processing technology for the treatment of polymetallic nodules at commercial scale, the continued establishment of mineable reserves, the commercial and technical feasibility of seafloor polymetallic nodule collection and processing, metal prices, and regulatory approvals and permitting for commercial operations.

The outcome of these matters cannot presently be determined because they are contingent on future events and may not be fully under the Company’s control.

Basis of Presentation

Statement of Compliance

These consolidated financial statements have been prepared in accordance with Generally Accepted Accounting Principles in the United States (“U.S.

GAAP”) and include the accounts of TMC and its wholly-owned subsidiaries.

The comparative figures reported in the Consolidated Balance Sheet for software development costs and equipment have been reclassified to conform to the current year’s presentation.

TMC the metals company Inc.

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(in thousands of US Dollars, except share, per share amounts and unless otherwise stated)

Basis of Presentation

Statement of Compliance

These consolidated financial statements have been prepared in accordance with Generally Accepted Accounting Principles in the United States (“U.S.

GAAP”) and include the accounts of TMC and its wholly-owned subsidiaries and equity accounted investments.

Basis of Measurement

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Interest Held

Subsidiary (1)

Principal Activity

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The Metals Company USA, LLC

Holding Company

Development Company

DeepGreen TOML Holding 1 Ltd.

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Mineral exploration

(1) The Company’s wholly owned subsidiaries Nauru Education and Training Foundation Inc.

and Nauru Health and Foundation Inc.

were voluntarily dissolved on June 30, 2024.

(2) PT Seafloor Mineral Ventures was incorporated on May 17, 2024.

(1) DeepGreen Metals ULC was merged into TMC the metals company Inc.

(its Canadian parent) on January 1, 2026.

All intra-group balances have been eliminated on consolidation.

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All gains and losses on translation of these foreign currency transactions are included in the statements of loss and comprehensive loss.

Use of Estimates

The preparation of financial statements in conformity with U.S.

GAAP requires management to make estimates and assumptions that affect the reported amounts in the consolidated financial statements and the notes thereto.

Significant estimates and assumptions

TMC the metals company Inc.

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(in thousands of US Dollars, except share, per share amounts and unless otherwise stated)

reflected in these consolidated financial statements include, but are not limited to, the evaluation of going concern, the valuation of share-based payments, including valuation of incentive stock options (Note 17), as well as the valuation of warrants liability (Note 15), and the valuation of the royalty liability (Note 9).

Actual results could differ materially from those estimates.

Loss Per Share

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A financial liability is derecognized when the obligation specified in the contract is discharged, cancelled, or expires.

The Company’s financial instruments consist of cash and cash equivalents, receivables, short-term debt, accounts payable and accrued liabilities which are recorded at cost as well as royalty liability and warrants to acquire common shares of the Company which are measured at fair value.

The Company’s financial instruments consist of cash, receivables (Note 6), short-term debt, accounts payable, accrued liabilities (Note 13) which are initially recognized and subsequently measured at amortized cost, while royalty liability (Note 10), and warrants to acquire common shares of the Company (Note 16) are initially recognized and subsequently measured at fair value with changes in fair value recognized in the consolidated statements of loss and comprehensive loss in the period in which they arise.

Fair Value of Financial Instruments

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As at December 31, 2025, and 2024, the carrying values of cash, receivables, short-term debt, accounts payable and accrued liabilities approximate their fair values due to the short-term nature of these instruments.

The financial instruments also include royalty liability and warrants which are recorded at fair value as disclosed in Note 9.

Cash and Cash Equivalents

Cash includes cash on hand and term deposits with a remaining term to maturity at acquisition of three months or less.

As at December 31, 2024 and 2023, the Company had no cash equivalents.

The Company’s financial instruments measured at fair value at each reporting period (Note 20) consist of its royalty liability (Note 10) and warrants (Note 16).

Cash includes cash on deposit with banking institutions and term deposits with a remaining term to maturity at acquisition of three months or less when purchased.

Equipment and Software

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The Company will amortize the cost of the software over its useful life after it is put in use, on commencement of nodule collection and treatment at a commercial scale.

Exploration Contracts

The Company is in the exploration stage with respect to its investment in exploration contracts and follows the practice of capitalizing costs related to the acquisition of such exploration contracts.

The cost of exploration contracts will be charged to operations using a unit-of-production method based on proven and probable reserves once commercial production commences in the future.

The Company evaluates impairment indicators on its exploration contracts at each reporting period and adjusts its carrying value if an impairment is identified.

Exploration Assets

The Company is in the development stage with respect to its investment in exploration contracts and follows the practice of capitalizing costs related to the acquisition of such exploration contracts.

The Company capitalizes costs incurred to renew or extend the term of exploration contracts upon filing for such extension.

The cost of exploration assets will be charged to operations using a unit-of-production method based on proven and probable reserves once commercial production commences in the future.

The Company evaluates impairment indicators on its exploration assets at each reporting period and adjusts its carrying value if an impairment is identified.

Exploration and Evaluation Expenses

While in the exploration phase, the Company expenses all costs related to exploration and development of exploration contracts.

Such exploration and development costs include, but are not limited to, exploration contract management, geological, geochemical and geophysical studies, environmental studies and process development.

While in the exploration and early development phases, the Company expenses all costs related to exploration and development of exploration contracts.

Such exploration and development costs include, but are not limited to environmental studies, mining, technological and process development, prefeasibility studies, sponsorship, training and stakeholder engagement, and personnel costs, including shared-based compensation.

TMC the metals company Inc.

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(in thousands of US Dollars, except share, per share amounts and unless otherwise stated)

We align our operating expenses based on activity performed by our personnel which allocates some of these costs to Exploration and Evaluation expenses.

This alignment is adjusted throughout the year to reflect changes in business activities.

Share-Based Compensation

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The Company records share-based compensation from the issuance of stock options and restricted share units (“RSUs”) to employees with service-based conditions using the accelerated attribution method.

TMC the metals company Inc.

Notes to Consolidated Financial Statements

(in thousands of US Dollars, except share, per share amounts and unless otherwise stated)

For stock options and restricted share units issued with performance conditions (Note 18), the Company recognizes share-based compensation cost when the specific performance targets become probable of being achieved using the accelerated attribution method.

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The Company evaluates all of its financial instruments, including issued share purchase warrants, to determine if such instruments are derivatives or contain features that qualify as embedded derivatives, pursuant to U.S.

GAAP Accounting Standard Coding (“ASC”) 480, Distinguishing Liability from Equity (“ASC 480”), and ASC 815, Derivatives and Hedging (“ASC 815”).

GAAP Accounting Standard Codification (“ASC”) 480, Distinguishing Liability from Equity (“ASC 480”), and ASC 815, Derivatives and Hedging (“ASC 815”).

The classification of derivative instruments, including whether such instruments should be recorded as liabilities or as equity, is re-assessed at the end of each reporting period.

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Fair value changes in the Private Warrants are recognized in the Company’s statement of loss and comprehensive loss.

The Company issued Class A Warrants and Class B Warrants in 2024.

The Class A Warrants and Class B Warrants met the criteria for equity classification and were recorded under additional paid in capital (Note 15).

The Company issued several other warrants in 2024 and 2025.

All these warrants met the criteria for equity classification and were recorded under additional paid-in capital (Note 16).

TMC the metals company Inc.

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Deferred tax benefits, including non-capital loss, capital loss, and tax credit carryforwards are recognized to the extent that realization of such benefits is considered more likely than not.

The effect on deferred tax assets and liabilities of a change in tax rates is recognized in the consolidated income statement in the period that enactment occurs.

The effect on deferred tax assets and liabilities of a change in tax rates is recognized in the consolidated statements of loss and comprehensive loss in the period that enactment occurs.

When realization of deferred income tax assets does not meet the more likely than not criterion for recognition, a valuation allowance is provided.

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The discount rate used to calculate the present value of lease payments is the rate implicit in the lease.

Lease liabilities due within the subsequent 12 months of the reporting date are classified as current lease liabilities and are included in accounts payable and accrued liabilities on the Company’s condensed consolidated balance sheet.

Lease liabilities payable after the subsequent 12 months of the reporting date are classified as non-current lease liabilities and are presented as non-current lease liability in the condensed consolidated balance sheet.

ROU assets are valued at the initial measurement of the lease liability, plus any indirect costs or rent prepayments, and reduced by any lease incentives and any deferred lease payments.

ROU assets are recorded as Right-of-use assets, net of any amortization on the condensed consolidated balance sheet.

ROU assets are recorded as Right-of-use assets, net of any amortization on the consolidated balance sheet.

Operating ROU assets are amortized on a straight-line basis over the lease term, whereas Finance ROU assets are amortized on a front-loaded basis.

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the present value of the remaining lease payments), adjusted for the remaining balance of any lease incentives received, any cumulative prepaid or accrued rent if the lease payments are uneven throughout the lease term and any unamortized initial direct costs.

The ROU assets for a finance lease are subsequently measured by amortizing them on a straight-line basis over the shorter of the lease term or useful life and also adjustment for any impairments.

The ROU assets for a finance lease are subsequently measured by amortizing them on a straight-line basis over the shorter of the lease term or useful life and also adjusted for any impairments.

TMC the metals company Inc.

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The Company consolidates investments over which it has control in accordance with ASC 810, Consolidation (“ASC 810”).

Where the Company does not have control over the investment, but has significant influence, the Company records the investment in accordance with ASC 323, Investments-Equity Method and Joint Ventures , whereby, after recording the initial investment, the Company recognizes its proportional share of results of operations of the affiliate in its consolidated financial statements.

Where the Company does not have control over the investment, but has significant influence, the Company records the investment in accordance with ASC 323, Investments-Equity Method and Joint Ventures , whereby, after recording the initial investment at cost, the Company recognizes its proportional share of results of operations and distributions from the affiliates in its consolidated financial statements.

The value of the equity method investments is impaired if it is determined that there is an other-than-temporary decline in value.

Short term debt

The Company records the results of certain equity method investees on a one-quarter reporting lag due to the timing when financial information becomes available.

The Company applies the cumulative earnings approach in determining the classification of distributions received from equity method investees in the statement of cash flows.

Short-term debt and credit facilities

The Company records borrowings under its short-term debt and line of credit at the amount drawn, net of any directly attributable financing costs.

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The accrued interest payable amount on the short-term debt and line of credit is disclosed under Accounts payable and accrued liabilities and classified as current liability.

The Company expenses advertising costs as incurred and are included in general and administrative expenses.

Advertising costs are not material for the periods presented.

Significant Accounting Estimates and Judgements

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Actual results may differ from these estimates.

Significant estimates and assumptions reflected in these consolidated financial statements include, but are not limited to, the evaluation of going concern, the valuation of share-based payments, including equity awards (Note 18), the valuation of warrants (Note 16), and the valuation of the royalty liability (Note 10).

Actual results may differ materially from these estimates.

Significant management judgments and estimates were applied to the following areas:

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Valuation of Share-Based Payments

The fair market value of share-based awards granted to employees, non-employees and directors is based on the closing market price of the Company’s shares, on the date these were granted (Note 17).

This valuation approach involves the use of estimates, judgments and assumptions that are subjective, such as those regarding the probability of future events.

The fair market value of RSUs granted to employees, non-employees and directors is based on the closing market price of the Company’s shares, on the date these were granted (Note 18).

TMC the metals company Inc.

Notes to Consolidated Financial Statements

(in thousands of US Dollars, except share, per share amounts and unless otherwise stated)

The valuation of other share-based awards, including stock options and any awards with market-based vesting conditions involves the use of estimates, judgments and assumptions that are subjective, such as those regarding the probability of future events.

Changes in these estimates and assumptions impact the Company’s valuation as of the valuation date and may have a material impact on the valuation of the Company’s common shares.

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The fair value of the Private Warrants was estimated using a Black-Scholes option pricing model whereby the expected volatility was estimated using a binomial model that assigned equal weight to the implied volatility of the Company’s Public Warrants, adjusted for the call feature triggered at prices above $ 18.00 over 20 trading days within any 30 -day period, and the historical volatility of the common share price.

TMC the metals company Inc.

Notes to Consolidated Financial Statements

(in thousands of US Dollars, except share, per share amounts and unless otherwise stated)

During the year the Company issued Class A warrants and Class B warrants (Note 15).

The warrants were valued using a Monte Carlo simulation by running 250,000 trials.

During 2025, the Company issued warrants to Republic of Nauru (“Nauru”) and to Kingdom of Tonga (“Tonga”) (Note 16).

These warrants are contingently exercisable and may only be exercised if the Company obtains a license to engage in deep seabed mineral recovery and elects to pursue such activities.

Accordingly, the Company measures the fair value of the warrants using a probability-weighted approach.

Under the scenario in which the license is obtained, fair value is estimated using a Black-Scholes option pricing model based on the implied share price under that scenario.

If the license is not obtained, the warrants are assumed to have no economic value.

Expected volatility is estimated using an equal-weighted blend of historical share price volatility and the implied volatility of the Company’s publicly traded warrants.

The Company also has outstanding Class A Warrants, Class B Warrants, Class C Warrants (each, as defined below) and warrants issued to Korea Zinc (Note 16) which were valued using a Monte Carlo simulation by running 250,000 trials.

The model assumed that the Company’s share price follows geometric Brownian motion which is a standard assumption used in Monte Carlo univariate pricing models.

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Valuation of Royalty Liability

The Company re-measures the fair value of its royalty liability at each reporting date (Note 9).

As NORI is in an advanced exploration stage and pre-production, the fair value of the royalty liability is measured by using a market approach which entails examining recent royalty transactions prior to the reporting date, focusing on those transactions that involve similar metals as contained in NORI’s polymetallic nodules.

The Company compares the specific characteristics of these transactions to estimate the fair value of its royalty liability at the reporting date.

The Company remeasures the fair value of its royalty liability at each reporting date (Note10).

The valuation of the royalty liability requires significant judgment and is dependent on the stage of development of the underlying assets and the availability of observable market data.

For areas that remain in an advanced exploration stage, the fair value is determined using a market approach.

This approach involves analyzing recent royalty transactions prior to the reporting date, with particular focus on transactions involving similar metals to those contained in the Company’s polymetallic nodules.

The Company evaluates the specific terms and characteristics of comparable transactions and applies judgment to estimate the fair value.

For areas supported by a pre-feasibility study (PFS), the fair value is determined using an income approach.

This approach applies a discounted cash flow model based on projected production and cash flows derived from the PFS.

Key assumptions include forecast metal prices, estimated operating and capital costs, production profiles, and a discount rate that reflects the risks specific to the project.

Changes in assumptions related to market conditions, permitting, project timelines, production forecasts, metal prices, repurchase options or discount rates could result in material changes to the estimated fair value of the royalty liability in future periods.

TMC the metals company Inc.

Notes to Consolidated Financial Statements

(in thousands of US Dollars, except share, per share amounts and unless otherwise stated)

Recent Accounting Pronouncements Issued and Adopted

In November 2023, Accounting Standard Update (“ASU”) 2023-07 was issued which improves disclosures about a public entity’s reportable segments and addresses requests from investors and other allocators of capital for additional, more detailed information about a reportable segment’s expenses and assets.

The ASU applies to all public entities that are required to report segment information in accordance with ASC 280.

The adoption of this update did not have a material impact on the Company’s consolidated financial statements or disclosures.

In December 2023, the Financial Accounting Standards Board (“FASB”) issued ASU 2023-09, Income Taxes (Topic 740):

Improvements to Income Tax Disclosures , which enhances the transparency and decision usefulness of income tax disclosures, including modifications to the rate reconciliation and income taxes paid disclosures.

The guidance is effective for public business entities for annual periods beginning after December 15, 2024.

The Company adopted ASU 2023-09 in 2025 on a prospective basis, as permitted by the standard (Note 24).

The adoption affected the presentation of income tax disclosures but did not impact the Company’s consolidated balance sheet, consolidated statement of loss and comprehensive loss and consolidated statement of cash flows.

Receivables and Prepayments

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Taxes and other receivables

TMC the metals company Inc.

Notes to Consolidated Financial Statements

(in thousands of US Dollars, except share, per share amounts and unless otherwise stated)

Equipment and Software

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(1) The software is under development and not in use.

Strategic Alliance with Allseas and Affiliates

TMC the metals company Inc.

Notes to Consolidated Financial Statements

(in thousands of US Dollars, except share, per share amounts and unless otherwise stated)

Strategic Alliance with Allseas Group S.

and Affiliates

Development of Project Zero Offshore Nodule Collection System

On March 16, 2022, NORI and Allseas entered into a non-binding term sheet for the development and operation of a commercial nodule collection system.

During the year ended December 31, 2024, Allseas provided the Company with engineering, project management and vessel use services consisting of lay-up and transit costs totaling $ 11.9 million, as part of the development of the commercial nodule collection system:

On March 16, 2022, NORI and Allseas Group S.A.

(“Allseas”) entered into a non-binding term sheet for the development and operation of a commercial nodule collection system.

For the year ended December 31, 2025, Allseas provided the Company with engineering, project management and vessel use services consisting of lay-up costs totaling $ 5.0 million, as part of the development of the commercial nodule collection system.

These costs were recorded as mining, technological and process development within exploration and evaluation expenses (Note 11) (2024:

1 unchanged sentence

Exclusive Vessel Use Agreement with Allseas

On August 1, 2023, the Company entered into an Exclusive Vessel Use Agreement with Allseas pursuant to which Allseas will give exclusive use of the vessel (“ Hidden Gem”) to the Company in support of the development of the Project Zero Offshore Nodule Collection System until the system is completed or December 31, 2026, whichever is earlier.

On August 1, 2023, the Company entered into an Exclusive Vessel Use Agreement with Allseas pursuant to which Allseas will give exclusive use of the vessel (“ Hidden Gem”) to the Company in support of the development of a commercial nodule collection system until the system is completed or December 31, 2026, whichever is earlier.

In consideration of the exclusivity term, the Company, on August 14, 2023, issued 4.15 million common shares to Allseas.

1 unchanged sentence

The Company recorded a lease liability and right-of-use asset of $ 6.5 million, which represents the fair value of 4.15 million common shares issued to Allseas on August 14, 2023, as consideration, and equal to the present value of the lease payments.

As the entire lease liability was settled within 14 days of the commencement of the lease, the discount rate for calculating the present value of lease payments was determined to be insignificant.

TMC the metals company Inc.

Notes to Consolidated Financial Statements

(in thousands of US Dollars, except share, per share amounts and unless otherwise stated)

The entire lease liability was settled within 14 days of the commencement of the lease and the discount rate for calculating the present value of lease payments was determined to be insignificant.

For the year ended December 31, 2025, the Company has recognized $ 1.9 million as lease expense recorded as exploration and evaluation expense (December 31, 2024:

$ 1.9 million).

As at December 31, 2024, the net amount of the lease liability was $ nil and right-of-use asset is as follows:

Lease Liability

Balance as at August 1, 2023

Payments made on August 14, 2023, by issuing 4.15 million common shares

Balance as at December 31, 2023 and 2024

As at December 31, 2025, the net amount of right-of-use asset was as follows:

Right-of-use Asset

Balance as on August 1, 2023

Balance as at December 31, 2023

Lease expense during the year

4 unchanged sentences

On March 22, 2023, the Company entered into an Unsecured Credit Facility Agreement, which was amended on July 31, 2023 (“2023 Credit Facility”), with Argentum Cedit Virtuti GCV (the “Lender”), the parent of Allseas Investments S.A.

(“Allseas Investments”) and an affiliate of Allseas, pursuant to which, the Company may borrow from the Lender up to $ 25 million in the aggregate, from time to time, subject to certain conditions.

All amounts drawn under the 2023 Credit Facility will bear interest based on the 6-month Secured Overnight Financing Rate, 180 -day average plus a margin of 4.0 % per annum payable in cash semi-annually (or plus a margin of 5 % if paid-in-kind at maturity, at the Company’s election) on the first business day of each of June and January.

The Company will pay an underutilization fee equal to 4.0 % per annum payable semi-annually for any amounts that remain undrawn under the 2023 Credit Facility.

The Company has the right to pre-pay the entire amount outstanding under the 2023 Credit Facility at any time before the 2023 Credit Facility’s maturity.

The Company has the ability to settle certain charges under the 2023 Credit Facility in cash or in equity at the discretion of the Company.

The 2023 Credit Facility also contains customary events of default.

On March 22, 2024, the Company entered into the Second Amendment to the Unsecured Credit Facility with the Lender, to extend the 2023 Credit Facility to August 31, 2025 and to provide that the underutilization fee thereunder shall cease to be payable after the date on which the Company or the Lender gives notice of termination of the agreement.

Under the amended 2023 Credit Facility, the Company may borrow from the Lender up to $ 25 million in the aggregate through August 31, 2025.

On August 16, 2024, the Company entered into the Third Amendment to the 2023 Credit Facility, to increase the borrowing limit of the 2023 Credit Facility to $ 27.5 million.

On November 14, 2024, as a result of the 2024 Registered Direct Offering (Note 13) the borrowing limit of the 2023 Credit Facility was returned to $ 25 million.

During the year ended December 31, 2024, the Company has not drawn any amount from the 2023 Credit Facility and has incurred $ 1 million as underutilization fees (December 31, 2023:

$ 0.8 million).

On May 27, 2024, the Company entered into a short-term loan agreement with the Lender.

In accordance with the agreement, the Lender provided a short-term loan to the Company amounting to $ 2 million (the “Short-Term Loan”) on May 30, 2024.

The Short-Term Loan matured on September 10, 2024 (maturity date) and accrued interest at a rate of 8 % per annum.

On the maturity date, Company repaid the entire Loan of $ 2 million and the accrued interest amounting to $ 46 thousand., which was recorded as interest expense.

On September 9, 2024, the Company entered into a working capital loan agreement (the “Working Capital Loan Agreement”) with Allseas Investments, a company related to Allseas.

In accordance with the Working Capital Loan Agreement, Allseas Investments provided a loan to the Company of $ 5 million (the “Working Capital Loan”) on September 10, 2024, to be used towards general corporate purposes and for the repayment of all outstanding amounts under the Short-Term Loan between the Company and the

(“Allseas Investments”) and an affiliate of Allseas, pursuant to which, the Company could borrow from the Lender up to $ 25 million in the aggregate, from time to time, subject to certain conditions.

All amounts drawn under the 2023 Credit Facility bore interest based on the 6-month Secured Overnight Financing Rate, 180 -day average plus a margin of 4.0 % per annum payable in cash semi-annually (or plus a margin of 5 % if paid-in-kind at maturity, at the Company’s election) on the first business day of each of June and January.

The Company had to pay an underutilization fee equal to 4.0 % per annum payable semi-annually for any amounts that remained undrawn under the 2023 Credit Facility.

The Company had the ability to settle certain charges under the 2023 Credit Facility in cash or in equity at the discretion of the Company.

The 2023 Credit Facility also contained customary events of default.

On March 24, 2025, the Company entered into a Letter Agreement with the Lender, pursuant to which the 2023 Credit Facility was cancelled with the only obligation remaining being the underutilization fees amounting to $ 2 million.

TMC the metals company Inc.

1 unchanged sentence

(in thousands of US Dollars, except share, per share amounts and unless otherwise stated)

The Working Capital Loan is payable to Allseas Investments on or before the earlier of (i) the occurrence of certain financing events and (ii) April 1, 2025 (the “Repayment Date”).

The Working Capital Loan will bear interest based on the 6-month Secured Overnight Financing Rate, 180 -day average plus a margin of 4.0 % per annum and is payable in two installments on January 2, 2025, and the Repayment Date (or plus a margin of 5.0 % if all interest payments are deferred to the Repayment Date, at the Company’s election).

On October 18, 2024, the Company entered into the First Amendment to the Working Capital Loan Agreement with Allseas Investments, resulting in a further draw of $ 2.5 million by the Company and a total Working Capital Loan drawn amount of $ 7.5 million.

On March 24, 2025, the Company entered into a Letter Agreement with Allseas Investments and Argentum Cedit Virtuti GCV, pursuant to which the Repayment Date under the Working Capital Loan Agreement was extended to September 30, 2025, with principal and interest now repayable on that date.

Additionally, under the same Letter Agreement, the Company and Argentum Cedit Virtuti GCV agreed to cancel the unsecured credit facility established under the 2023 Facility Agreement with no outstanding amounts remaining, other than the Company’s obligation to pay Argentum the Underutilization Fee.

During the year ended December 31, 2024, the Company incurred $ 0.2 million as interest expense.

As at December 31, 2024, the total amount payable to Allseas and its affiliates was $ 33.3 million, with $ 7.5 million of this amount recorded as short-term debt and the remaining balance recorded in accrued liabilities in the Consolidated Balance Sheet (Note 12) (December 31, 2023:

$ 13.8 million, recorded as accrued liabilities).

As at December 31, 2024, Allseas and its affiliates owned 53.8 million TMC common shares (2023:

During the year ended December 31, 2025, the Company did no t draw down any amount from the 2023 Credit Facility (December 31, 2024 - $ nil ) and incurred $ 0.2 million as underutilization fees (December 31, 2024:

$ 1 million).

On September 9, 2024, the Company entered into a working capital loan agreement (the “Working Capital Loan Agreement”) with Allseas Investments, a company related to Allseas, and on the next day received initial principal amount of $ 5 million (“Working Capital Loan”).

Pursuant to an amendment dated October 18, 2024, the agreement was amended to increase the loan amount to $ 7.5 million, reflecting an additional $ 2.5 million draw.

The Working Capital Loan was payable to Allseas Investments on or before the earlier of (i) the occurrence of certain financing events and (ii) April 1, 2025 (the “Repayment Date”).

The Working Capital Loan bore interest based on the 6-month Secured Overnight Financing Rate, 180 -day average plus a margin of 4.0 % per annum and was payable in two installments on January 2, 2025, and the Repayment Date (or plus a margin of 5.0 % if all interest payments are deferred to the Repayment Date, at the Company’s election).

On March 24, 2025, the Company entered into a Letter Agreement with Allseas Investments, pursuant to which the Repayment Date under the Working Capital Loan Agreement was extended to September 30, 2025, with principal and interest repayable on that date.

On June 4, 2025, the Company repaid the outstanding loan principal and interest, amounting to $ 7.5 million and $ 0.5 million, respectively, thereby cancelling the Working Capital Loan Agreement.

For the year ended December 31, 2025, the Company incurred $ 0.3 million as interest expense (December 31, 2024:

$ 0.2 million).

Other Activity

On May 12, 2025, the Company entered into a securities purchase agreement with Allseas (Note 14) pursuant to which the Company issued 2,333,333 common shares of the Company, and 2,333,333 Class C Warrants to Allseas in exchange for gross proceeds of $ 7 million.

As at December 31, 2025, the total amount payable to Allseas and its affiliates was $ 34.2 million of which $ 32.2 million related to the development of the nodule collection system and $ 2 million related to the underutilization fees payable on the 2023 Credit facility.

These amounts were recorded in accrued liabilities in the consolidated balance sheet which can be settled in cash or equity at the Company’s discretion (Note 13) (December 31, 2024:

$ 33.3 million, of which $ 25.8 recorded as accrued liabilities and $ 7.5 million recorded as short-term debt).

As at December 31, 2025, Allseas and its affiliates owned 56.1 million common shares of the Company (2024:

53.8 million TMC common shares) which constituted 13.3 % (December 31, 2024:

15.8 %) of total common shares outstanding.

Investment in Low Carbon Royalties

TMC the metals company Inc.

Notes to Consolidated Financial Statements

(in thousands of US Dollars, except share, per share amounts and unless otherwise stated)

On February 21, 2023 (the “Closing Date”), the Company and its wholly-owned subsidiary, NORI, entered into an investment agreement (the “Royalty Agreement”) with Low Carbon Royalties Inc.

(“Low Carbon Royalties”).

In connection with the Royalty Agreement, NORI contributed a 2 % gross overriding royalty (the “NORI Royalty”) on the Company’s NORI project area in the CCZ to Low Carbon Royalties.

In consideration of the NORI Royalty, TMC received 35.0 % of the common shares issued by Low Carbon Royalties and $ 5 million in cash, as of the Closing Date.

On March 21, 2023, Low Carbon Royalties acquired additional gross overriding royalties on natural gas fields in Latin America.

The royalty acquisitions were financed through the issuance of Low Carbon Royalties common shares to the third-party vendor of such royalties, thereby reducing the Company’s ownership in the Partnership to 32 % from 35 %.

In connection with the Royalty Agreement, NORI contributed a 2 % gross overriding royalty (the “NORI Royalty”) (Note 10) on the Company’s NORI project area in the CCZ to Low Carbon Royalties.

In consideration of the NORI Royalty, TMC received an ownership in Low Carbon Royalties and $ 5 million in cash, as of the Closing Date.

In connection with the Royalty Agreement the Company entered into an Investor Rights Agreement with Low Carbon Royalties and a shareholder of Low Carbon Royalties, pursuant to which the Company and this shareholder each have a right, subject to certain percentage maintenance, to nominate a director to Low Carbon Royalties’ board of directors, along with registration and information rights.

Based on the fair value of the NORI Royalty granted and the cash received, the Company recorded $ 9 million as investment in Low Carbon Royalties on the Closing Date.

In the third quarter of 2025, Low Carbon Royalties changed its name to The Metals Royalty Company Inc.

(“The Metals Royalty Company”) and formed 1554997 B.C.

As a condition of closing the Royalty Agreement, the parties entered into an agreement with Low Carbon Royalties to mitigate risks associated with the potential termination of the exploitation license granted for one of the royalty-producing natural gas fields in Latin America (the “Exploitation License”).

1 unchanged sentence

The CVR would convert into 5 million additional shares of Low Carbon Royalties all of which would be issued to NORI, in the event the Exploitation License is found, in a final decision, to be invalid by the Colombian National Agency of Hydrocarbons prior to the earlier of (1) five years from the issuance of the CVR and (2) the date Low Carbon Royalties becomes a publicly listed entity.

Based on the fair value of the NORI Royalty granted and the cash received, the Company recorded $ 9 million as investment in Low Carbon Royalties on the Closing Date.

For the year ended December 31, 2024, the Company’s share of the net loss generated by the Low Carbon Royalties was $ 0.2 million (2023:

0.6 million).

During 2025, The Metals Royalty Company issued 3,443,699 common shares against stock option exercise and 4,569,770 common shares through various private placement, raising $ 25.0 million of gross proceeds.

The Company did not participate in the offering, which reduced its ownership interest from 32.27 % to 27.2 %.

(December 31, 2024:

As the shares were issued at a price higher than The Metals Royalty Company’s book value per share, the Company recorded a dilution gain of $ 5.6 million.

In the fourth quarter of 2025, The Metals Royalty Company transferred its oil and gas royalty assets to 1554997 B.C.

in exchange for shares of 1554997 B.C.

Ltd (“Spin-Out transaction’).

The Metals Royalty Company subsequently distributed the shares of 1554997 B.C.

to its existing shareholders as a return of capital on a one -for-one basis for each common share of The Metals Royalty Company, resulting in The Metals Royalty Company retaining no ownership interest in 1554997 B.C.

Following the Spin-Out transaction, the Company recognized its investment in 1554997 B.C.

at its proportionate share ( 27.2 %) of the fair value of the net assets transferred.

Following completion of the Spin-Out transaction, the Company evaluated its investment in 1554997 B.C.

under ASC 810, “ Consolidation” and concluded that consolidation was not required as the Company does not have a controlling financial interest in 1554997 B.C.

The Company holds 27.2 % ownership interest and has representation on the board of directors of 1554997 B.C.

Ltd., providing the Company with the ability to exercise significant influence over 1554997 B.C.

Ltd.’s operating and financial policies.

Accordingly, the investment is accounted for under the equity method in accordance with ASC 323 ( Investments ).

As the financial information of 1554997 B.C.

is not available on a timely basis, the Company records its share of the results in 1554997 B.C.

Ltd on a one-quarter reporting lag.

As at December 31, 2025, The Metals Royalty Company had 872,250 stock options and 1,569,000 restricted share units outstanding, the settlement of which may significantly affect the Company’s share of reported earnings or losses.

TMC the metals company Inc.

1 unchanged sentence

(in thousands of US Dollars, except share, per share amounts and unless otherwise stated)

Fair value of NORI Royalty

Cash received

Cost of Investment on Closing Date

Equity-accounted investment loss for the year ended 2023

The below table summarizes the changes in the Company’s investments during the year:

The Metals Royalty

Investment as at December 31, 2023

1 unchanged sentence

Investment as at December 31, 2024

The NORI Royalty was recorded as a royalty liability in the consolidated Balance Sheet in accordance with ASC 470, Debt (“ASC 470”).

The Company elected to account for the royalty liability at fair value through profit and loss.

The fair value was determined using a market approach which entails examining recent royalty transactions prior to the reporting date, focusing on those transactions that involve similar metals as contained in NORI’s polymetallic nodules.

The Company compares the specific characteristics of these transactions to estimate the fair value.

The fair value of the royalty liability as at December 31, 2024 remained unchanged at $ 14 million.

Financial results of Low Carbon Royalties as at and for the years ended December 31, 2024 and 2023 are summarized below:

Spin-Out transaction

Return of capital (1)

Dilution gain

Equity-accounted investment gain for the year ended 2025

Investment as at December 31, 2025

(1) During 2025, both investees declared and paid a return of capital of $ 0.025 per share with the Company’s share of return of capital amounting to $ 0.3 million from each investee.

Financial results of The Metals Royalty Company at and for the years ended December 31, 2025 and 2024 are summarized below:

Current assets

1 unchanged sentence

Current liabilities

Royalty Income

Total Revenue

Comprehensive Loss for the Year

Exploration Contracts

Operating expenses

Loss from continuing operations

Net income (loss)

Financial information for 1554997 B.C.

is not presented as the Company reports its share of results in this investment on a one-quarter reporting lag and the investment was acquired in the fourth quarter of 2025.

Royalty Liability

The NORI Royalty (including Areas A to D) (Note 9) was recorded as a royalty liability in the consolidated Balance Sheet in accordance with ASC 470, Debt .

The Company elected to account for the royalty liability at fair value through profit and loss.

The fair value of Areas A to C was determined using a market approach which entails examining recent royalty transactions prior to the reporting date, focusing on those transactions that involve similar metals as contained in NORI’s polymetallic nodules.

The Company compared the specific characteristics of these transactions and estimated the fair value for Areas A to C at $ 15 million as at December 31, 2025.

The fair value of Area D was determined using an income approach following the Company’s completion and release of its PFS with respect to NORI Area D filed in August 2025 resulting with a fair value for Area D of $ 130 million as at December 31, 2025.

The discounted cash flow fair value reflects updated operational and economic assumptions, including the use of forward metal prices and a discount rate of approximately 10.6 %, related to the NORI Area D project used in support of the PFS.

TMC the metals company Inc.

Notes to Consolidated Financial Statements

(in thousands of US Dollars, except share, per share amounts and unless otherwise stated)

The following table presents the changes in the fair value of the royalty liability:

Royalty Liability

Royalty liability as at December 31, 2024

Increase in fair value of royalty liability

Royalty liability as at December 31, 2025

Exploration Assets

Significant Exploration Agreements

NORI Exploration Contract:

The Company’s wholly-owned subsidiary, NORI, was granted the NORI Exploration Contract on July 22, 2011 under the sponsorship of Nauru.

The Company’s wholly-owned subsidiary, NORI, was granted an exploration contract (“NORI Exploration Contract”) on July 22, 2011 under the sponsorship of Nauru.

The contract application fee of $ 0.3 million, provides NORI with exclusive rights to explore for polymetallic nodules in the NORI Area for an initial term of 15 years (renewable for successive five-year periods) subject to complying with the exploration contract terms (Note 22) and provides NORI with the priority right to apply for an exploitation contract to collect polymetallic nodules in the same area.

The NORI Exploration Contract terminates on July 22, 2026, and the Company has filed for an extension.

NORI has a right to renounce, without penalty, in whole or part of its rights in the NORI Area at any time and therefore does not have a fixed commitment with relation to the NORI Exploration Contract (Note 22).

TMC the metals company Inc.

Notes to Consolidated Financial Statements

(in thousands of US Dollars, except share, per share amounts and unless otherwise stated)

TOML Exploration Contract:

TOML was granted the TOML Exploration Contract on January 11, 2012 under the sponsorship of Tonga.

TOML was granted an exploration contract (“TOML Exploration Contract”) on January 11, 2012 under the sponsorship of Tonga.

The TOML Exploration Contract provides TOML with exclusive rights to explore for polymetallic nodules in the TOML Area for an initial term of 15 years (renewable for successive five-year periods) subject to complying with the exploration contract terms and a priority right to apply for an exploitation contract to collect polymetallic nodules in the same area.

The TOML Exploration Contract terminates on January 11, 2027.

On March 31, 2020, the Company entered into an acquisition agreement with Deep Sea Mining Finance Ltd.

1 unchanged sentence

Total purchase price of the TOML Acquisition, before transaction costs, was $ 32.0 million comprising of $ 42.7 million for exploration contracts offset by $ 10.7 million for deferred tax liability.

TOML holds an ISA exploration contract in the CCZ (“TOML Exploration Contract”) and some exploration related equipment.

TOML holds the TOML Exploration Contract and some exploration related equipment.

Reconciliation – Exploration Contracts

1 unchanged sentence

December 31, 2023

Termination of Marawa Agreement

Termination of Marawa Option Agreement

December 31, 2024

Changes during the year

December 31, 2025

TMC the metals company Inc.

Notes to Consolidated Financial Statements

(in thousands of US Dollars, except share, per share amounts and unless otherwise stated)

The detail of exploration and evaluation expenses is as follows:

For the year ended December 31, 2024

Environmental Studies

Exploration Labor

Share-Based Compensation (Note 17)

Mining, Technological and Process Development

Prefeasibility Studies

Sponsorship, Training and Stakeholder Engagement

Permit Application Activities

For the year ended December 31, 2023

For the year ended

Environmental studies

4 unchanged sentences

Sponsorship, training and stakeholder engagement

TMC the metals company Inc.

Notes to Consolidated Financial Statements

(in thousands of US Dollars, except share, per share amounts and unless otherwise stated)

Exploration and Evaluation Expenses

Reflects underlying project-related work performed by the Company’s personnel.

Mining, technological and process development include $ 0.1 million of expenses settled with RSUs in 2025 (2024:

$ nil ) (Note 18).

General and Administrative Expenses

General and administrative expenses for the years ended December 31, 2025 and 2024 are as follows:

For the year ended

8 unchanged sentences

Travel expenses

Other expenses

General and Administrative Expenses

Professional and consulting fees include $ 3.6 million of expenses settled with RSUs in 2025 (2024:

$ 0.4 million).

$ 1.2 million) (Note 18).

Includes $ 58.9 million related to 6,500,000 options and 11,915,676 RSUs granted to some directors and a consultant on August 28, 2025 (Note 18).

(3) Reflects underlying corporate-related activities performed by the Company’s personnel.

TMC the metals company Inc.

Notes to Consolidated Financial Statements

(in thousands of US Dollars, except share, per share amounts and unless otherwise stated)

Accounts Payable and Accrued Liabilities

2 unchanged sentences

Accrued Liabilities (2)

(1) The accounts payable balance includes $ 0.7 million of underutilisation fees payable to the related parties under 2024 Credit facility (Note 21).

As at December 31, 2025, accrued liabilities totaled $ 43.8 million (December 31, 2024 - $36.5 million), of which $ 34.2 million relates to Allseas (Note 8) (December 31, 2024 - $ 25.8 million).

1 unchanged sentence

2024 Registered Direct Offering

On August 14, 2023, the Company entered into a securities purchase agreement (the “2023 Purchase Agreement”) with certain investors, pursuant to which the Company agreed to sell and issue, in a registered direct offering (the “2023 Registered Direct Offering”) 12,461,540 common shares and issue Class A Warrants to purchase 6,230,770 common shares (“Class A Warrants”) (Note 15).

Each common share and accompanying Class A Warrant were sold at a price of $ 2.00 per unit.

The exercise price to purchase one common share under the Class A Warrants is $ 3.00 , subject to adjustment as provided in the warrant agreement.

On January 30, 2024, the Company received the final balance of the committed funding amounting to $ 9 million (representing 4,500,000 common shares and 2,250,000 Class A Warrants) from an investor affiliated with the Company.

As at December 31, 2024, all common shares and Class A Warrants to purchase common shares under the 2023 Registered Direct Offering had been issued and the Company received gross proceeds amounting to $ 24.9 million.

The Company incurred $ 1.3 million as offering expenses, resulting in net proceeds received of $ 23.6 million.

Out of the total net proceeds received of $ 23.6 million, the net proceeds attributable to common shares were $ 18.9 million (Note 16) and the net proceeds attributable to Class A Warrants were $ 4.7 million (Note 15).

In the last quarter of 2024, the Company entered into a securities purchase agreement with certain investors, pursuant to which the Company agreed to sell and issue, in a registered direct offering (the “2024 Registered Direct Offering”) an aggregate of 19,900,000 common shares and issue Class B Warrants to purchase 9,950,000 Common Shares (“Class B Warrants”) (Note 16).

The purchase price per common share and accompanying Class B Warrant was set at $ 1.00 .

On February 6, 2025, the Company received the final balance of committed funding from the 2024 Registered Direct Offering amounting to $ 5 million and issued 5,000,000 common shares and 2,500,000 Class B Warrants.

Out of the total net proceeds of $ 5 million received in 2025, the net proceeds attributable to common shares were $ 2.2 million and the net proceeds attributable to Class B Warrants were $ 2.8 million (Note 16).

2025 Registered Direct Offering

On May 12, 2025, the Company entered into a securities purchase agreement with certain new and existing investors pursuant to which the Company in consideration of gross proceeds of $ 37 million, agreed to sell and issue, in a registered direct offering (the “2025 Registered Direct Offering”), an aggregate of 12,333,333 common shares of the Company, and accompanying Class C warrants to purchase an aggregate of 12,333,333 common shares (“Class C Warrants”) to such new and existing investors (Note 16).

The purchase price per common share and accompanying Class C Warrant was set at $ 3.00 .

As of December 31, 2025, the Company received the entire gross proceeds of $ 37 million and issued 12,333,333 common shares and 12,333,333 Class C Warrants.

The total expenses related to the 2025 Registered Offering were $ 0.3 million resulting in net proceeds of $ 36.7 million.

Agreement with Korea Zinc

On June 16, 2025, the Company entered into a securities purchase agreement (the “Korea Zinc Agreement”) with Korea Zinc Company, Ltd.

(“Korea Zinc”), pursuant to which the Company in consideration of gross cash receipt of $ 85.2 million, agreed to issue and sell to Korea Zinc 19,623,376 common shares of the Company and accompanying warrants to purchase an aggregate of 6,868,181 common shares (Note 16).

The purchase price per share and accompanying warrant was set at $ 4.34 .

As at December 31 2025, the Company received the entire purchase amount of $ 85.2 million and issued 19,623,376 common shares and accompanying warrants to purchase an aggregate of 6,868,181 common shares.

The total expenses related to the Korea Zinc agreement were $ 1.9 million paid in equity.

TMC the metals company Inc.

1 unchanged sentence

(in thousands of US Dollars, except share, per share amounts and unless otherwise stated)

2024 Registered Direct Offering

On November 14, 2024, the Company entered into a securities purchase agreement (the “2024 Purchase Agreement”) with certain investors, pursuant to which the Company agreed to sell and issue, in a registered direct offering (the “2024 Registered Direct Offering”) 17,500,000 common shares and issue Class B Warrants to purchase 8,750,000 Common Shares (“Class B Warrants”) (Note 15).

Each common share and accompanying Class B Warrant were sold at a price of $ 1.00 per unit.

The exercise price to purchase one common share under the Class B Warrants is $ 2.00 , subject to adjustment as provided in the 2024 Purchase Agreement.

On November 26, 2024, the Company and the requisite initial investors entered into the First Amendment to the 2024 Purchase Agreement, pursuant to which the Company agreed to sell and issue an additional 2,400,000 common shares and accompanying Class B Warrants to purchase 1,200,000 common shares to new investors on the same terms and conditions as initially offered.

Including the First Amendment to the 2024 Purchase Agreement, the Company agreed to sell and issue in aggregate 19,900,000 common shares and Class B Warrants to purchase 9,950,000 common shares.

As at December 31, 2024, 14,900,000 common shares and Class B Warrants to purchase 7,450,000 common shares under the 2024 Registered Direct Offering had been issued following the receipt of gross proceeds of $ 14.9 million.

The Company incurred $ 0.7 million as offering expenses, resulting in net proceeds received of $ 14.2 million.

Out of the total net proceeds received of $ 14.2 million, the net proceeds attributable to common shares were $ 9.7 million (Note 16) and the net proceeds attributable to Class B Warrants were $ 4.5 million (Note 15).

On February 6, 2025, the Company received the final balance of committed funding of $ 5 million (representing 5,000,000 common shares and 2,500,000 Class B Warrants).

Pursuant to the Korea Zinc Agreement, subject to certain exceptions, Korea Zinc will have a right to participate in any public offering or private placement of any common shares or common share equivalents of the Company primarily for capital raising purposes (each a “Proposed Offering”) up to such amount of securities to maintain its percentage ownership in the Company at the time of such Proposed Offering.

Such right to participate in future financings will expire upon the earlier to occur of (i) June 16, 2030, (ii) the date on which Korea Zinc owns less than all of the common shares it purchased and subscribed pursuant to the Korea Zinc Agreement and (iii) immediately after a closing of a Proposed Offering where Korea Zinc does not exercise its participation right in full.

Additionally, the Korea Zinc Agreement provides that a representative of Korea Zinc may serve as a non-voting observer to the Company’s board of directors, which representative may have access to certain information and attend and provide input at meetings of the Company’s board of directors, subject to certain limitations.

Shares issued as per At-the-Market Equity Distribution Agreement (“ATM”)

1 unchanged sentence

In 2025, the Company issued 7,542,996 common shares (2024:

nil ) at an average share price of $ 1.53 , resulting in net proceeds of $ 4.9 million, after incurring $ 113 thousand as commission and fees (Note 16).

3,251,588 ) (Note 17) at an average share price of $ 2.02 (2024:

$ 1.53 ), resulting in net proceeds of $ 14.8 million (2024:

$ 4.9 million), after incurring $ 0.5 million (2024:

$ 0.1 million) as commission and fees.

The ATM expired in October 2025.

Public Warrants

As at December 31, 2025, 15,000,000 Public Warrants were outstanding:

there were no exercises or issuances during 2025 (December 31, 2024 – 15,000,000 ).

Each whole Public Warrant entitles the holder to purchase one common share at a price of $ 11.50 per share beginning on October 9, 2021, subject to restrictions as described further.

5 unchanged sentences

No Public Warrants will be exercisable and the Company will not be obligated to issue a common share upon exercise of a Public Warrant unless the common share issuable upon such warrant exercise has been registered, qualified or deemed to be exempt under the securities laws of the state of residence of the registered holder of the warrants.

In the event that the conditions in the two immediately preceding sentences are not satisfied with respect to a Public Warrant, the holder of such warrant will not be entitled

In the event that the conditions in the two immediately preceding sentences are not satisfied with respect to a Public Warrant, the holder of such warrant will not be entitled to exercise such warrant and such warrant may have no value and expire worthless.

In no event will the Company be required to net cash settle any Public Warrants.

In the event that a registration statement is not effective for the exercised Public Warrants, the purchaser of a unit containing such warrant will have paid the full purchase price for the unit solely for the common share underlying such unit.

TMC the metals company Inc.

1 unchanged sentence

(in thousands of US Dollars, except share, per share amounts and unless otherwise stated)

to exercise such warrant and such warrant may have no value and expire worthless.

In no event will the Company be required to net cash settle any Public Warrants.

The Company may call the Public Warrants for redemption:

5 unchanged sentences

● the quotient obtained by dividing (x) the product of the number of common shares underlying such warrant, multiplied by the excess of the average reported closing price of common shares for the ten trading days ending on the third trading day prior to the date on which the notice of redemption is sent to the holders (“Fair Market Value”) over the warrant price by (y) the Fair Market Value, and

As at December 31, 2024, the value of outstanding Public Warrants of $ 19.5 million was recorded in additional paid in capital.

As at December 31, 2025, the value of outstanding Public Warrants of $ 19.5 million (2024:

$ 19.5 million) was recorded in additional paid-in capital.

Private Warrants

As at December 31, 2024, 9,500,000 Private Warrants were outstanding.

The Private Warrants (including the common shares issuable upon exercise of the Private Warrants) were not transferable, assignable or salable until October 9, 2021, except to permitted transferees.

As at December 31, 2025, 9,500,000 Private Warrants were outstanding (December 31, 2024 – 9,500,000 ).

The Private Warrants are identical to the Public Warrants, except that so long as they are held by the Sponsor or any of its permitted transferees:

4 unchanged sentences

● the quotient obtained by dividing (x) the product of the number of common shares underlying the warrants, multiplied by the excess of the average reported closing price of the common shares for the ten trading days ending on the third trading day prior to the date on which the notice of warrant exercise is sent to the warrant agent (“fair market value”) over the exercise price of the warrants by (y) the fair market value.

If the Private Warrants are held by a holder other than the Sponsor or any of its permitted transferees, the Private Warrants are redeemable by the Company in all redemption scenarios applicable to the Public Warrants and exercisable by such holders on the same basis as the Public Warrants.

The Private Warrants will expire on September 9, 2026.

TMC the metals company Inc.

1 unchanged sentence

(in thousands of US Dollars, except share, per share amounts and unless otherwise stated)

The Company evaluated the Private Warrants under ASC 815-40, in conjunction with the SEC Statement , and concluded that they do not meet the criteria to be classified in shareholders’ equity.

6 unchanged sentences

Warrants liability as at December 31, 2024

Decrease in fair value of warrants liability

Increase in fair value of warrants liability

Warrants liability as at December 31, 2025

6 unchanged sentences

Class A Warrants

Under the 2023 Registered Direct Offering (Note 13) which closed on August 14, 2023, the Company issued 3,980,770 Class A Warrants to purchase common shares at an exercise price of $ 3.00 per share.

These Class A Warrants were valued on August 14, 2023, at a fair value of $ 0.80 per warrant, using a Monte Carlo valuation.

As at December 31, 2025, 4,317,500 Class A warrants, which we issued as part of a registered direct offering in 2023, were outstanding (the “Class A Warrants”).

Each whole Class A Warrant entitles the holder to purchase one common share at an exercise price of $ 2.00 per share and will expire on December 31, 2027.

The Class A Warrants contain a call provision under which if the Volume Weighted Average Price “VWAP” for 30 consecutive trading days exceeds $ 6.50 , and the warrant holder does not possess material non-public information provided by the Company, the Company may call for cancellation of the unexercised warrants, offering $ 0.0001 per Warrant Share.

1 unchanged sentence

The Class A Warrants were not determined to be liabilities under ASC 480 as they were not required to be redeemed.

The Company classified the Class A Warrants as equity (per ASC 815), as the warrants entailed physical settlement and were also considered to be indexed to the Company’s share, wherein, upon exercise, a fixed number of common shares would be issued on payment of a

TMC the metals company Inc.

1 unchanged sentence

(in thousands of US Dollars, except share, per share amounts and unless otherwise stated)

fixed exercise price.

As at December 31, 2023, the Company recorded the total fair value of these Class A Warrants amounting to $ 3.2 million as additional paid in capital.

On January 30, 2024, the Company received the final balance of the committed funding under the 2023 Registered Direct Offering (Note 13) and on January 31, 2024, issued 2,250,000 Class A Warrants to purchase common shares at an exercise price of $ 3.00 per share.

The Class A Warrants issued on January 31, 2024 had the same terms as the Class A Warrants issued in 2023.

The remaining 2,250,000 Class A Warrants were valued on January 31, 2024, using a Monte Carlo simulation, resulting in a fair value of $ 0.69 per warrant, with the total fair value of these warrants amounting to $ 1.6 million which was recorded as additional paid in capital.

The fair value of the Class A Warrants issued on January 31, 2024 was estimated using the following assumptions:

A continuity schedule summarizing the movement in Class A Warrants is below:

Number of Class A

Outstanding – December 31, 2023

Outstanding – December 31, 2024

Exercised (1)

( 1,913,270 )

Outstanding – December 31, 2025

During 2025, 1,913,270 Class A Warrants were exercised for which the Company received the exercise amount of $ 3.8 million.

As at December 31, 2025, the value of the outstanding 4,317,500 Class A Warrants (December 31, 2024:

6,230,770 ) amounting to $ 3.6 million (December 31, 2024:

5.3 million) was recorded in additional paid-in capital.

Class B Warrants

As a part of the 2024 Registered Direct Offering (Note 14), the Company issued an aggregate of 9,950,000 Class B Warrants for the purchase of common shares at an exercise price of $ 2.00 per share.

The Class B Warrants expire 5 years from the issuance date.

The valuation of the Class B Warrants was determined using a Monte Carlo simulation as on the date of issuance as per below.

Fair value per warrant

Assumptions used:

Exercise price

2 unchanged sentences

Dividend yield

The 2023 Purchase Agreement stipulates a down round feature wherein if between August 14, 2023, and December 31, 2024, the Company, or its subsidiaries issue, sell, or grant options or rights to purchase common shares or equivalents at a price lower than either i) $ 2.00 or ii) the exercise price in effect, the exercise price of the outstanding Class A Warrants will automatically reset to the lower of these two amounts.

On reset of the exercise price, the number of shares issuable will not change.

On November 14, 2024, the Company entered into the 2024 Purchase Agreement (Note 13), pursuant to which the Company agreed to sell and issue one common share and the accompanying Class B Warrant to purchase one half of a common share at a price of $ 1.00 .

As the issuance under the 2024 Purchase Agreement was less than $ 2.00 per common share, the down round feature of the Class A Warrants was triggered on November 14, 2024 (the “Trigger date”) and the exercise price was reset from $ 3.00 per share to $ 2.00 per share.

In accordance with ASC 260, Earnings per Share , on the Trigger date, the Company measured the difference between the fair values of the Class A Warrants using an exercise price of $ 3.00 per share and an exercise price of $2.00 per share.

The fair values of the Class A Warrants on November 14, 2024, with an exercise price of $ 2.00 per share and an exercise price of $ 3.00 per share were $ 0.50 per warrant and $ 0.41 per warrant, respectively, and were estimated using Monte Carlo simulations based on the following assumptions:

Call price threshold

The Class B Warrants contain a call provision under which if the Volume Weighted Average Price “VWAP” for 30 consecutive trading days exceeds $ 5.00 , and the warrant holder does not possess material non-public information provided by the Company, the Company may call for cancellation the unexercised warrants, offering $ 0.0001 per Warrant Share.

If conditions for the call are met, the unexercised portion of these warrants will be cancelled ten trading days after the call notice is received.

As the Class B Warrants had the same features as the above-mentioned Class A Warrants, the Company classified the Class B Warrants as equity (per ASC 815) and recorded the fair value of the Class B Warrants amounting to $ 7.2 million as additional paid-in capital.

TMC the metals company Inc.

Notes to Consolidated Financial Statements

(in thousands of US Dollars, except share, per share amounts and unless otherwise stated)

On June 17, 2025, the Company waived the limitation set forth in the Class B Warrants with respect to the cashless exercise thereof so that the holders of the Class B Warrants may now exercise the Class B Warrants through a cashless exercise, whether or not a registration statement registering the issuance of the common shares underlying the Class B Warrants under the Securities Act, is then effective or available.

As a result of the waiver, each Class B Warrant may now be immediately exercised by way of a cashless exercise, meaning that the holder may elect to not pay a cash purchase price upon exercise and instead receive upon such exercise the net number of common shares determined according to the formula set forth in the Class B Warrants, subject to the other terms and conditions of the Class B Warrants.

A continuity schedule summarizing the movements in Class B Warrants is below:

Number of Class B

Outstanding – December 31, 2023

Outstanding – December 31, 2024

Exercised (1)

( 9,935,000 )

Outstanding – December 31, 2025

(1) During 2025, 9,935,000 Class B Warrants were exercised for which the Company received the exercise amount of $ 4.2 million.

Out of the 9,935,000 Class B Warrants exercised during 2025, 5,035,000 Class B warrants were exercised by way of cashless exercises against which 3,533,096 common shares were issued.

As at December 31, 2025, the value outstanding of 15,000 Class B Warrants (December 31, 2024 - 7,450,000 Class B Warrants) amounting to $ 9 thousand (December 31, 2024 - $ 4.5 million) was recorded in additional paid-in capital.

Class C Warrants

As a part of the 2025 Registered Direct Offering (Note 14), the Company issued an aggregate of 12,333,333 Class C Warrants to purchase common shares at an exercise price of $ 4.50 per share with an expiration date of May 12, 2028.

The valuation of the Class C Warrants issued was determined using a Monte Carlo simulation on the date of issuance.

Fair value per warrant

Exercise price

Risk-free rate

Dividend yield

The difference in the above-mentioned fair values was $ 0.09 per warrant, or $ 0.6 million in aggregate.

In accordance with ASC 260, the difference in the fair values was considered to be a deemed dividend and was recorded as additional paid in capital on November 14, 2024.

The Class C Warrants contain a call provision under which if the Volume Weighted Average Price “VWAP” for 20 consecutive trading days exceeds $ 7.00 , and the warrant holder does not possess material non-public information provided by the Company, the Company may call for cancellation of the unexercised warrants, offering $ 0.0001 per Warrant Share.

If conditions for the call are met, the unexercised portion of these warrants may be cancelled ten trading days after the call notice is received.

TMC the metals company Inc.

1 unchanged sentence

(in thousands of US Dollars, except share, per share amounts and unless otherwise stated)

As at December 31, 2024, 6,230,770 Class A Warrants were outstanding.

Class B Warrants

As a part of the 2024 Registered Direct Offering (Note 13), the Company issued 7,450,000 Class B Warrants for the purchase of common shares at an exercise price of $ 2.00 per share.

The Class B Warrants expire on November 14, 2029.

The valuation of these Class B Warrants was determined using a Monte Carlo simulation.

The Class B Warrants were valued on November 14, 2024 at a fair value of $ 0.60 per warrant.

The fair value of the Class B Warrants was estimated using the following assumptions:

As the Class C Warrants had the same features as the above-mentioned Class A Warrants and Class B Warrants, the Company classified the Class C Warrants as equity (per ASC 815) and recorded the value amounting to $ 12.5 million in additional paid-in capital.

A continuity schedule summarizing the movements in Class C Warrants is below:

Number of Class C

Outstanding – December 31, 2024

Exercised (1)

( 2,330,000 )

Outstanding – December 31, 2025

(1) During 2025, 2,330,000 Class C Warrants were exercised for which the Company received the exercise amount of $ 10.5 million.

As at December 31, 2025, the value of the outstanding 10,003,333 Class C Warrants amounting to $ 10.2 million was recorded in additional paid-in capital.

Warrants issued to Korea Zinc

As part of the Korea Zinc Agreement (Note 14), the Company on June 25, 2025 issued 6,868,181 warrants to Korea Zinc to purchase common shares of the Company at an exercise price of $ 7.00 per share with an expiration date of June 25, 2028.

The fair value of the warrants issued to Korea Zinc was determined using a Monte Carlo simulation on June 25, 2025, resulting with a fair value of $ 3.35 per warrant.

The fair value of the warrants was estimated using the following assumptions:

Exercise price

Call price threshold

Risk-free rate

Dividend yield

The warrants issued to Korea Zinc contain a call provision under which if the VWAP for 20 consecutive trading days exceeds $ 10 , and Korea Zinc does not possess material non-public information provided by the Company, the Company may call for cancellation of the unexercised warrants, offering $ 0.0001 per warrant Share.

If conditions for the call are met, the unexercised portion of these warrants will be cancelled ten trading days after the call notice is received.

As the Class B Warrants had the same features as the above-mentioned Class A Warrants, the Company classified the Class B Warrants as equity (per ASC 815) and on November 14, 2024, recorded the fair value of the Class B Warrants amounting to $ 4.5 million as additional paid in capital.

There were no exercises or redemptions of the Public Warrants, Private Warrants, Class A Warrants and Class B Warrants during the year ended December 31, 2024.

As on December 31, 2024, 7,450,000 Class B Warrants were outstanding.

On February 6, 2025, the Company received the final balance of committed funding and issued the remaining 2,500,000 Class B Warrants.

Similar to the Class A, Class B and Class C Warrants, the Company classified the warrants issued to Korea Zinc as equity (per ASC 815) and the value of the warrants amounting to $ 11.5 million was recorded in additional paid-in capital.

A continuity schedule summarizing the movement in Warrants issued to Korea Zinc is below:

Number of Warrants

Outstanding – December 31, 2024

Outstanding – December 31, 2025

TMC the metals company Inc.

1 unchanged sentence

(in thousands of US Dollars, except share, per share amounts and unless otherwise stated)

Warrants issued to Republic of Nauru

In accordance with the revised sponsorship agreement dated May 29, 2025, between the Nauru Seabed Minerals Authority, Nauru and NORI, the Company on May 30, 2025, issued 9,146,268 warrants (“Nauru Warrants”) to Nauru to purchase the common shares of the Company at an exercise price of $ 4.72 per share with an expiration date of May 30, 2030.

The Nauru Warrants cannot be exercised through a cashless or net exercise.

The fair value of the Nauru Warrants was calculated using a Black-Scholes valuation on May 30, 2025, resulting with a fair value of $ 3.62 per warrant.

The fair value of the Nauru Warrants was estimated using the following assumptions:

Exercise price

Risk-free rate

Dividend yield

The Nauru Warrants cannot be exercised until the following conditions have been met:

● A subsidiary of the Company other than NORI obtains a permit, license or other authorization from the United States for the conduct of deep seabed mineral activities;

● The subsidiary other than NORI commences commercial recovery activities of deep seabed minerals pursuant to that permit, license or other authorization.

The Nauru Warrants were not determined to be liabilities under ASC 480 as they were not mandatorily redeemable.

The Company classified the Nauru Warrants as equity (per ASC 815), as the warrants require physical settlement and were also considered to be indexed to the Company’s share, wherein, upon exercise, a fixed number of common shares would be issued on payment of a fixed exercise price.

As at December 31, 2025, the fair value of the Nauru Warrants amounting to $ 33.1 million was recorded in additional paid-in capital.

Since the Company receives no form of consideration from Nauru in return for issuing the Nauru Warrants, the entire fair value of the Nauru warrants amounting to $ 33.1 million is recorded as an expense in 2025 under Nauru and Tonga warrant costs in the consolidated statement of loss and comprehensive loss.

Warrants issued to the Kingdom of Tonga

In accordance with the revised sponsorship agreement dated August 4, 2025, between the Tonga Seabed Minerals Authority and TOML, the Company issued, on August 4, 2025, 1,000,000 warrants (“Tonga Warrants”) to Tonga to purchase the common shares of the Company at an exercise price of $ 5.87 per share with an expiration date of August 4, 2033.

The Tonga Warrants cannot be exercised through a cashless or net exercise.

TMC the metals company Inc.

Notes to Consolidated Financial Statements

(in thousands of US Dollars, except share, per share amounts and unless otherwise stated)

The fair value of the Tonga Warrants was calculated on issuance using a Black-Scholes valuation, 2025, resulting with a fair value of $ 5 per warrant.

The fair value of the Tonga Warrants was estimated using the following assumptions:

Exercise price

Risk-free rate

Dividend yield

The Tonga Warrants cannot be exercised until the following conditions have been met:

● A subsidiary of the Company other than TOML obtains a permit, license or other authorization from the US for the conduct of deep seabed mineral activities;

● The subsidiary other than TOML commences commercial recovery activities of deep seabed minerals pursuant to that permit, license or other authorization.

The Tonga Warrants were not determined to be liabilities under ASC 480 as they were not mandatorily redeemable.

The Company classified the Tonga Warrants as equity (per ASC 815), as the warrants require physical settlement and were also considered to be indexed to the Company’s share, wherein, upon exercise, a fixed number of common shares would be issued on payment of a fixed exercise price.

As at December 31, 2025, the fair value of the Tonga Warrants amounting to $ 5 million was recorded in additional paid-in capital.

Since the Company receives no form of consideration from the State in return for issuing the Tonga Warrants, the entire fair value of the Tonga Warrants was recorded as an expense in 2025 under Nauru and Tonga warrant costs in the consolidated statement of loss and comprehensive loss.

Common Shares

Authorized and Issued

As at December 31, 2024, the authorized, issued and outstanding common shares and Special Shares of the Company are as follows:

As at December 31, 2025, the authorized, issued and outstanding common shares of the Company and special shares of the Company (the “Special Shares”) are as follows:

Common Shares

Unlimited , with no par value

Preferred Shares

Unlimited , with no par value

Class A Special Shares

18 unchanged sentences

741,000 , with no par value

TMC the metals company Inc.

Notes to Consolidated Financial Statements

(in thousands of US Dollars, except share, per share amounts and unless otherwise stated)

The holders of the Company’s common shares are entitled to one vote for each common share held.

The shares do not have an expiration date and remain outstanding until redeemed or converted in accordance with their terms.

Each class of Special Shares do not have voting rights and do not participate in earnings.

The Special Shares automatically convert to TMC common shares if TMC common shares trade at a price on any 20 trading days within any 30 -trading day period that is greater than or equal to the specific trigger price for the respective class of Special Share.

Below is a summary of the Special Shares and their respective vesting thresholds, assuming the full number of Special Shares from Rollover Options are issued:

The Special Shares automatically convert to common shares of the Company if the common shares trade at a price on any 20 trading days within any 30 -trading day period that is greater than or equal to the specific trigger price for the respective class of Special Share.

Below is a summary of the Special Shares and their respective vesting thresholds, assuming the full number of special shares from underlying certain outstanding options to purchase common shares and Special Shares are issued:

Special Share Class

2 unchanged sentences

As the Special Shares meet the indexation and equity classification criteria under ASC 815-40, the Special Shares have been classified as equity instruments at issuance.

TMC the metals company Inc.

Notes to Consolidated Financial Statements

(in thousands of US Dollars, except share, per share amounts and unless otherwise stated)

Common Share Continuity

1 unchanged sentence

December 31, 2023

Issuance of shares under 2023 Registered Direct Offering (Note 13)

Exercise of warrant by Allseas

Shares issued to Allseas

Exercise of stock options (Note 17)

Conversion of restricted share units (Note 17)

Share purchase under Employee Stock Purchase Plan (Note 17)

Issuance of shares under 2023 Registered Direct Offering

Issuance of shares under 2024 Registered Direct Offering

Shares issued as per At-the Market Equity Distribution Agreement

Conversion of restricted share units

Exercise of stock options

Share purchase under Employee Stock Purchase Plan

December 31, 2024

Issuance of shares to Korea Zinc (Note 14)

Issuance of shares under 2025 Registered Direct Offering (Note 14)

3 unchanged sentences

Exercise of stock options (Note 18)

Share purchase under Employee Stock Purchase Plan (Note 17)

Exercise of Class A Warrants (Note 16)

Exercise of Class B Warrants (Note 16)

Exercise of Class C Warrants (Note 16)

Shares purchased under Employee Stock Purchase Plan (Note 18)

December 31, 2025

TMC the metals company Inc.

Notes to Consolidated Financial Statements

(in thousands of US Dollars, except share, per share amounts and unless otherwise stated)

Share-Based Compensation

The Company’s 2021 Incentive Equity Plan (the “ Incentive Plan”) provides that the aggregate number of common shares reserved for future issuance under the Incentive Plan.

As of December 31, 2024, there were a total of 56,634,518 common shares reserved for issuance under the Incentive Plan out of which 37,870,371 common shares remained available for future issuances.

These amounts include 12,262,348 shares added to the Incentive Plan in January 2024 pursuant to the Incentive Plan’s automatic annual increase provision, provided that 2,243,853 of the outstanding common shares shall only be available for awards made to non-employee directors of the Company.

The Company’s 2021 Incentive Equity Plan (the “Incentive Plan”) provides an aggregate number of common shares reserved for future issuance under the Incentive Plan.

As at December 31, 2025, there were a total of 110,262,856 common shares reserved for issuance under the Incentive Plan.

This amount includes 40,000,000 common shares added to the plan pursuant to the shareholder’s approval obtained at the special meeting of the Company’s shareholders held on August 28, 2025.

With this increase, as of December 31, 2025, 11,690,432 common shares remained available for future issuance under the Incentive Plan, provided that 2,243,853 of the outstanding common shares shall only be available for awards made to non-employee directors of the Company.

On the first day of each fiscal year from 2022 to 2031, the number of common shares that may be issued pursuant to the Incentive Plan is automatically increased by an amount equal to the lesser of 4 % of the number of outstanding common shares or an amount determined by the board of directors.

Share-based awards consisting of Restricted Share Units (“RSU”) and options under the Short-Term Incentives Plan (“STIP”) and Long-Term Incentives Plan (“LTIP”) have been issued under the 2021 Incentive Equity Plan.

Share-based awards consisting of RSUs and options under the Short-Term Incentives Plan (“STIP”) and Long-Term Incentives Plan (“LTIP”) have been issued under the 2021 Incentive Equity Plan.

Prior to the 2021 Incentive Plan, the Company had granted share-based awards under the 2018 Stock Option Plan (“2018 Plan”).

Following the special shareholders meeting, 6,500,000 options and 11,915,676 RSUs were granted on August 28, 2025.

Stock options

Outstanding under the Incentive Plan.

On April 9, 2024, the Company entered into a consulting agreement with Mr.

Jurvetson, a director of the Company.

As per the agreement, Mr.

Jurvetson would serve as a special advisor to the Company’s Chief Executive Officer for a term of five years .

As the sole compensation for his advisory services, Mr.

Jurvetson was granted stock options to purchase 3,440,000 of the Company’s common shares, with an exercise price equal to $ 1.71 , under the Incentive Plan.

The options vest in thirds on each anniversary of the grant date of the options provided that Mr.

Jurvetson is still providing services to the Company at such time and expire on April 9, 2031.

On April 9, 2024, the Company also granted stock options to purchase 500,000 shares to a consultant in exchange for advisory services over a 5-year period ending April 9, 2029.

A continuity schedule summarizing the movements in the Company’s stock options under the Incentive Plan is as follows:

value of stock

contractual life

Outstanding – December 31, 2023

Outstanding – December 31, 2024

Outstanding – December 31, 2025

Outstanding – December 31, 2025 - Vested and exercisable

A summary of the Company’s stock options granted and outstanding under the Company’s Incentive Plan as at December 31, 2025 is as follows:

Number of Options

Weighted average

Outstanding and

Exercise price

life to expiry (years)

April 9, 2031

March 4, 2032

As on December 31, 2025, 11,190,000 stock options were outstanding under the Incentive plan.

TMC the metals company Inc.

1 unchanged sentence

(in thousands of US Dollars, except share, per share amounts and unless otherwise stated)

The Company determined the fair value of the options to be $ 1.36 per unit using the Black-Scholes valuation method.

The fair value was estimated using the following assumptions:

During the first quarter of 2025, the Company granted 1,250,000 stock options out of which 500,000 stock options vest in thirds on each anniversary of the grant date.

The fair value of the stock options vesting in thirds was estimated on the date of grant using the Black-Scholes method and the following assumptions:

Exercise price

1 unchanged sentence

Dividend yield

(1) As these were the first options granted under the Incentive Plan, the expected term was estimated using the simplified method which is calculated as the average of the time to vest for each tranche from the grant date and the 7-year contractual term.

During the year, the Company recognized $ 1.3 million of share-based compensation expense related to the amortization of stock options, reported under general and administrative expenses in the statement of loss and comprehensive loss.

There were no forfeitures and exercises during the year and as at December 31, 2024, there were 3,940,000 options outstanding under the Company’s 2021 Incentive Plan (2023:

The intrinsic value of the outstanding stock options was $ nil and was calculated by considering the closing market price of the Company’s common shares as the fair value of the Company’s common share.

The total unrecognized share-based compensation expense of $ 4 million is expected to be recognized over a period of approximately two years .

(1) As there has been no exercise of options granted under the Incentive Plan, the expected term was estimated using the simplified method which is calculated as the average of the time to vest for each tranche from the grant date and the 7-year contractual term.

The remaining 750,000 stock options vest as follows:

Tranche 1 - 25 % when the Company’s market capitalization equals $ 3 billion;

Tranche 2 - 35 % when the Company’s market capitalization equals $ 6 billion;

Tranche 3 – 20 % upon the date that the ISA grants an exploitation contract to the Company;

Tranche 4 – 20 % upon the commencement of the first commercial production following the grant of the exploitation contract.

Tranche 1 and Tranche 2 vest based on market conditions of the Company’s market capitalization reaching $ 3 billion and $ 6 billion, respectively.

Accordingly, these options are determined to be market-based awards for which the Company has calculated fair value and derived a service period through which to expense the related fair value.

The options included in Tranche 1 and Tranche 2 had a grant date fair value of $ 1.09 per share and $ 0.90 per share and derived service periods of 1.40 years and 1.88 years, respectively.

The Company will expense these awards rateably over the remaining service period.

Tranche 3 and Tranche 4 of the stock options granted vest based on the date the ISA grants an exploitation contract and the commencement of commercial production.

These options are determined to be performance-based awards.

In 2025, Tranche 1 vested, and the Company recognized the entire fair value of the options under that tranche.

The options included in Tranche 3 and Tranche 4 had a grant date fair value of $ 1.20 and $ 1.24 per share respectively.

The Company will recognize compensation costs for the performance-based awards when the Company concludes that it is probable that the performance conditions will be achieved.

As the achievement of performance of these conditions at December 31, 2025 was not probable, the Company has not recorded any compensation expense for the performance-based awards.

The Company will reassess the probability of the vesting of the performance-based awards at each reporting period and adjust the compensation cost when the criteria is determined to be probable.

The fair values of the options in Tranche 1 and Tranche 2 were estimated on the date of grant using the Monte Carlo method whereas the fair values of the options in Tranche 3 and Tranche 4 were determined using the Black-Scholes valuation and the following assumptions:

March 14, 2025

Tranches 1 and 2

Exercise price

Risk-free rate

Dividend yield

TMC the metals company Inc.

Notes to Consolidated Financial Statements

(in thousands of US Dollars, except share, per share amounts and unless otherwise stated)

On August 28, 2025, and in consideration for strategic consulting services rendered, the Company granted 6,500,000 options out of which 5,000,000 options were granted to a director of the Company.

The 6,500,000 options vest as follows:

50 % vest upon the Company’s share price trading above $ 5 for ten consecutive days, or the Company’s market capitalization reaches or exceeds $ 2.2 billion, for ten consecutive days.

50 % vest upon the Company’s share price trading above $ 7 for ten consecutive days, or the Company’s market capitalization reaches or exceeds $ 3 billion, for ten consecutive days.

These options were determined to be market-based awards and the grant date fair value of both tranches was calculated at $ 4.10 per unit using Black-Scholes valuation and the following assumptions.

Exercise price

Risk-free rate

Dividend yield

As the vesting conditions were met as of the date of the grant, the Company amortized the entire fair value of the options amounting to $ 26.7 million in the third quarter of 2025.

During the year, the Company recognized $ 28.8 million of share-based compensation expense (2024:

$ 1.3 million) related to the amortization of stock options out of which $ 28.6 million was recorded under general and administrative expenses in the statement of loss and comprehensive loss (2024:

$ 1.3 million) and $ 0.2 million was recorded under exploration and evaluation expenses (2024:

The intrinsic value of the outstanding stock options was $ 30.7 million (2024:

$ nil ) and was calculated by considering the closing market price of the Company’s common shares as the fair value of the Company’s common share.

The total unrecognized share-based compensation expense of $ 2.6 million (2024:

$ 4 million) is expected to be recognized over a period of approximately two years .

Outstanding under the Company’s 2018 Plan.

No new stock options were granted by the Company as STIPs or LTIPs under the 2018 Plan during 2025 and 2024.

TMC the metals company Inc.

Notes to Consolidated Financial Statements

(in thousands of US Dollars, except share, per share amounts and unless otherwise stated)

Outstanding STIPs under the 2018 plan:

A continuity schedule summarizing the movements in the Company’s stock options under the STIP plan is as follows:

A continuity schedule summarizing the movements in the Company’s stock options under the STIP plan granted under the 2018 Plan is as follows:

Outstanding – December 31, 2023

Outstanding – December 31, 2024

( 4,051,304 )

Outstanding – December 31, 2025 Vested and exercisable

TMC the metals company Inc.

Notes to Consolidated Financial Statements

(in thousands of US Dollars, except share, per share amounts and unless otherwise stated)

A summary of the Company’s stock options granted and outstanding under the Company’s STIP as at December 31, 2024 is as follows:

A summary of the Company’s stock options outstanding under the Company’s STIP under the 2018 Plan as at December 31, 2025 is as follows:

Weighted average

3 unchanged sentences

Exercise price

December 31, 2025

January 27, 2026

2 unchanged sentences

June 30, 2028

The total grant date fair value of STIP stock options that vested during the year ended December 31, 2024, was $ 1 million.

As at December 31, 2025, all the options are vested and the total unrecognized share-based compensation expense was $ nil .

As at December 31, 2024, the closing market price of the Company’s common shares is considered to be the fair value of the Company’s common share to determine the intrinsic value of outstanding stock options.

The closing market price of the Company’s common shares is considered to be the fair value of the Company’s common share to determine the intrinsic value of outstanding stock options.

The aggregate intrinsic value of stock options exercised during the year ended December 31, 2025, was $ 22.6 million (2024:

During the year, the Company recognized $ 47 thousand of share-based compensation expense for STIP stock options in the statement of loss and comprehensive loss (2023:

$ 0.5 million) out of which share-based compensation expense related to exploration and evaluation activities amounted to $ 14 thousand (2023 - $ 0.2 million) and the share-based compensation expense recognized related to general and administrative matters amounted to $ 33 thousand (2023 - $ 0.3 million).

$ 0.7 million).

The Company did no t recognize any share-based compensation expense related to STIP stock options in the statement of loss and comprehensive loss for the current period, as the full fair value of the STIP stock options was expensed by the end of 2024 (2024:

Total $ 47 thousand of which $ 14 thousand related to exploration and evaluation activities and $ 33 thousand related to general and administrative matters).

Outstanding LTIPs under the 2018 plan:

On March 4, 2021, the Company granted 9,783,922 stock options as LTIP.

On March 4, 2021, the Company granted 9,783,922 stock options as LTIP under the 2018 Plan.

These stock options have an exercise price of $ 0.65 per option and expire on June 1, 2028.

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(2) Tranche 2 - 35 % when the Company’s market capitalization equals $ 6 billion;

TMC the metals company Inc.

Notes to Consolidated Financial Statements

(in thousands of US Dollars, except share, per share amounts and unless otherwise stated)

(3) Tranche 3 - 20 % upon the date that the ISA grants an exploitation contract to the Company;

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The Company expensed these awards ratably over the remaining service period.

The total fair value of Tranche 1 and Tranche 2 was expensed by the end of 2022.

Tranche 1 vested during the second quarter of 2025 as the Company’s market capitalization exceeded $ 3 billion.

Tranche 3 and Tranche 4 of the LTIP stock options vest based on the date the ISA grants an exploitation contract and the commencement of commercial production.

1 unchanged sentence

The Company will recognize compensation costs for the performance-based awards if and when the Company concludes that it is probable that the performance conditions will be achieved.

As at December 31, 2024, no compensation expense related to the performance-based

TMC the metals company Inc.

Notes to Consolidated Financial Statements

(in thousands of US Dollars, except share, per share amounts and unless otherwise stated)

awards was recorded as the awarding of an ISA contract is outside the control of the Company.

As at December 31, 2025, no compensation expense related to the performance-based awards was recorded as the awarding of an ISA contract is outside the control of the Company.

The Company will reassess the probability of the vesting of the performance-based awards at each reporting period and adjust the compensation cost when determined to be probable.

The aggregate intrinsic value of LTIP stock options as at December 31, 2024, was $ 4.5 million.

An aggregate 139,048 LTIP stock options were forfeited during 2024 and as at December 31, 2024, none of the LTIP stock options were exercisable.

The Company expects LTIP options to vest as and when the market and performance milestones described below are achieved.

As at December 31, 2024, an aggregate of 9,644,875 LTIP stock options were outstanding.

A continuity schedule summarizing the movements in the Company’s stock options under the LTIP plan granted under the 2018 Plan is as follows:

exercise price

intrinsic value

of stock options

Outstanding – December 31, 2023

Outstanding – December 31, 2024

Outstanding – December 31, 2025

Outstanding – December 31, 2025 - Vested and exercisable

As at December 31, 2025, total unrecognized share-based compensation expense for the LTIP stock options was $ 23 million (2024:

In 2024, the Company reversed $ 0.6 million of previously recognized share-based compensation expense to record the forfeiture of unvested LTIP stock options in the statement of loss and comprehensive loss (2023:

$ nil ), evenly apportioned between exploration and evaluation expenses (Note 10) and general and administration expenses.

$ 23 million).

The aggregate intrinsic value of stock options exercised during the year ended December 31, 2025, was $ 4.4 million (2024:

Restricted Share Units

The Company may, from time to time, grant RSUs to directors, officers, employees, and consultants of the Company and its subsidiaries under the Plan.

The Company may, from time to time, grant RSUs to directors, officers, employees, and consultants of the Company and its subsidiaries under the Incentive Plan.

On each vesting date, RSU holders are issued common shares equivalent to the number of RSUs held provided the holder is providing service to the Company on such vesting date.

A summary of the RSU activity in 2024 is presented in the table below:

TMC the metals company Inc.

Notes to Consolidated Financial Statements

(in thousands of US Dollars, except share, per share amounts and unless otherwise stated)

A summary of the RSU activity in 2025 and 2024 is presented in the table below:

Number of RSUs

5 unchanged sentences

( 1,076,371 )

( 20,296,128 )

Outstanding – December 31, 2025

2 unchanged sentences

Vesting immediately (1)

Vesting fully on the first anniversary of the grant date (2)

Vesting fully within and on the first anniversary of the grant date (2)

Vesting in thirds on each anniversary of the grant date (3)

Vesting in fourths on each anniversary of the grant date

Vesting three years from grant date (4)

Vesting four years from grant date (5)

Vesting based on performance conditions (6)

Vesting based on market conditions (7)

Total Units Granted

TMC the metals company Inc.

Notes to Consolidated Financial Statements

(in thousands of US Dollars, except share, per share amounts and unless otherwise stated)

(1) Of the 3,432,724 RSUs granted during 2025 and vesting immediately, 2,469,585 RSUs were issued to settle liabilities with a carrying amount of $ 4.1 million, at a weighted average grant date fair value of $ 1.68 per RSU (2024:

2,812,802 RSUs were issued to settle liabilities with a carrying amount of $ 4.1 million, at a weighted average grant date fair value of $ 1.44 per RSU).

In addition, the Company granted 661,428 RSUs, to consultants (2024:

274,912 RSUs) resulting in $ 1.1 million, charged as general and administrative expenses (2023:

720,155 RSUs) resulting in $ 2.2 million, charged as general and administrative expenses and $ 0.1 million charged as exploration and evaluation expenses (2024:

$ 1.1 million charged as general and administrative expenses).

In 2024, the Company also granted 57,756 RSUs, to consultants as a prepayment for their services (2023:

43,478 units).

(2) Of the 493,430 units granted during 2024, an aggregate amount of 476,189 RSUs (2023:

1,014,349 RSUs) were granted to the Company’s non-employee directors under the Company’s Non-employee Director Compensation Policy, which will vest at the Company’s 2025 annual shareholders meeting.

In the second quarter of 2025, the Company granted 91,512 RSUs to non-employee directors in lieu of cash compensation.

The remaining 210,199 RSUs were granted to employees in 2025.

(2) Of the 282,878 RSUs, granted during 2025, an aggregate of 134,226 RSUs were granted to the Company’s non-employee directors under the Company’s Non-employee Director Compensation Policy, which will vest at the Company’s 2026 annual shareholders meeting (2024:

476,189 RSUs issued to Company’s non-employee directors).

The total fair value of units granted as annual grants to non-employee directors amounted to $ 0.6 million (2024:

$ 0.7 million).

The remaining 148,652 units were granted to consultants resulting in $ 0.2 million charged to general and administrative expenses in 2025 (2024:

the remaining 17,241 units were granted to a director as annual fees for consulting services to be provided, which were fair valued at $ 25 thousand).

(3) Of the 7,212,374 units granted during 2024, the Company granted 7,144,347 RSUs, as payment for the 2023 LTIP awards (2023:

(3) The Company granted 8,818,935 RSUs in the first quarter of 2025, as payment for the 2024 LTIP awards (2024:

7,144,347 RSUs were issued as payment for the 2023 LTIP awards).

The remaining 68,027 units were granted to a non-employee director of the Company as an initial grant, as prescribed under the Company’s Non-employee Director Compensation Policy.

(4) On April 16, 2024, the Company entered into a new employment agreement with Gerard Barron, the Company’s Chief Executive Officer and Chairman (the “Employment Agreement”) that replaced and superseded Mr.

Barron’s existing employment agreement.

Under the Employment Agreement, the Company granted Mr.

Barron a one-time signing bonus award of market-based restricted stock units (the “Signing RSUs”) amounting to 20,000,000 of the Company’s common shares.

The Signing RSUs will vest upon the common shares achieving the following closing prices per common share, based on the trailing 30 -day average price (the “Closing Price”), on or prior to April 16, 2029 (maturity date), subject to Mr.

Barron’s continued service with the Company on the applicable vesting date:

one -third of the Signing RSUs vest on achievement of a Closing Price of $ 7.50 , a further one -third vest on achievement of a Closing Price of $ 10.00 and the final one -third vest on achievement of a Closing Price of $ 12.50 (each subject to equitable adjustment for any stock splits, combinations, reclassifications, stock dividends and the like).

Pursuant to the Employment Agreement, Mr.

Barron has agreed not to sell any of the common shares issuable upon vesting of the Signing RSUs until after the fifth anniversary of entering into the Employment Agreement.

The Company determined the fair value of the options using the Monte-Carlo valuation method.

The fair value of each tranche and the derived service period are as follows:

Fair Value per RSU

Derived Service Period

Achievement of a Closing Price of $ 7.50

1.58 years from the grant date

Achievement of a Closing Price of $ 10

1.87 years from the grant date

Achievement of a Closing Price of $ 12.50

2.10 years from the grant date

The fair value of the Signing RSUs was estimated using the following assumptions:

April 16, 2024

In the third quarter of 2025 415,676 RSUs were granted out of which 237,529 RSUs were granted to a director of the Company in exchange for consulting services and the remaining units were granted to a consultant resulting in an aggregate of $ 0.3 million charged to general and administrative expenses in 2025 (2024:

68,027 units were granted to a non-employee director of the Company as an initial grant, as prescribed under the Company’s Non-employee Director Compensation Policy).

TMC the metals company Inc.

Notes to Consolidated Financial Statements

(in thousands of US Dollars, except share, per share amounts and unless otherwise stated)

(4) The Company issued a special retention grant to one of the Company’s non-employee directors.

The fair value of the grant amounted to $ 0.3 million.

(5) 1,750,000 RSUs were granted to a director of the Company in exchange for consulting services resulting in an aggregate of $ 0.8 million charged to general and administrative expenses in 2025 (Note 21).

(6) 688,969 units issued based on performance conditions.

In 2025, all these RSUs were vested as the performance conditions were achieved resulting in $ 2.7 million charged to general and administrative expenses and $ 0.1 million charged to exploration and evaluation expenses.

(7) From the 19,750,000 RSUs granted in 2025, 18,750,000 RSUs were issued in the third quarter of 2025 and the remaining 1,000,000 RSUs were granted in the last quarter of 2025.

Out of 18,750,000 RSUs issued in the third quarter of 2025, 9,000,000 RSUs were granted to certain employees (“Retention Grants”), vesting in two equal tranches based on market and service conditions:

50 % upon the 30 -day average share price reaching $ 10 and Tranche 2:

50 % upon the 30 -day average share price reaching $ 12.50 , subject to continued employment through specific target dates per the grant terms.

The Company calculated the fair value of the Retention Grants using Monte Carlo simulation and below assumptions.

The fair value of Tranche 1 and Tranche 2 was calculated as $ 5.82 per unit and $ 5.58 per unit respectively.

September 23,

Performance Period to achieve market conditions

September 23, 2025 – April 16, 2029

Risk-free rate

Dividend yield

The remaining 9,750,000 RSUs were considered as granted on August 28, 2025, out of which 7,500,000 were granted to a director of the Company (Note 21) in return for consulting services and the remaining 2,250,000 were granted to a consultant.

The RSUs vest in three equal tranches as described below:

Vesting upon share price reaching or exceeding $ 10 for 10 consecutive trading days, or the Company’s market capitalization reaching or exceeding $ 3.3 billion, for ten consecutive days.

Vesting upon share price reaching or exceeding $ 12.50 for 10 consecutive trading days, or the Company’s market capitalization reaching or exceeding $ 4 billion, for ten consecutive days.

Vesting upon share price reaching or exceeding $ 15 for 10 consecutive trading days, or the Company’s market capitalization reaching or exceeding $ 5 billion, for ten consecutive days.

The Company determined the fair value of the 9,750,000 RSUs using a Monte-Carlo valuation method and below assumptions.

Performance Period

April 16, 2024 – April 16, 2029

June 4, 2025 – June 4, 2029

Risk-free rate

Cost of Equity

Dividend yield

The grant date fair value of all RSUs, apart from the Signing RSUs, is equivalent to the closing share price of the Company’s common shares on the date of grant.

The grant date fair value of the RSUs vesting based on market conditions was determined

TMC the metals company Inc.

1 unchanged sentence

(in thousands of US Dollars, except share, per share amounts and unless otherwise stated)

using the Monte-Carlo valuation method.

During the year, a total of $ 19.5 million was charged to the statement of loss and comprehensive loss as share-based compensation expense for RSUs (2023:

The fair value of each tranche and the derived service period are as follows:

Fair Value per RSU

Derived Service Period

In the last quarter of 2025, the Company granted 1,000,000 RSUs to an employee with the same conditions as the Retention Grants granted in the third quarter of 2025.

The Company calculated the fair value of the grant issued in the last quarter of 2025 using a Monte Carlo simulation and below assumptions.

The fair value of Tranche 1 and Tranche 2 was calculated as $ 5.84 per unit and $ 5.62 per unit respectively.

December 30, 2025

Performance Period to achieve market conditions

December 30, 2025 – April 16, 2029

Risk-free rate

Dividend yield

In 2024, the Company entered into a new employment agreement with Gerard Barron, the Company’s Chief Executive Officer and Chairman as per which a one-time signing bonus award of 20,000,000 market-based restricted stock units were granted.

The grant date fair value of all RSUs, apart from the ones mentioned in footnote 7 in the table above, is equivalent to the closing share price of the Company’s common shares on the date of grant.

During 2025, a total of $ 60.1 million was charged to the statement of loss and comprehensive loss as share-based compensation expense for RSUs (2024:

$ 19.5 million) of which share-based compensation expense related to exploration and evaluation activities amounted to $ 15.1 million (2024 - $ 10.7 million) and share-based compensation expense related to general and administration matters amounted to $ 45 million (2024 - $ 8.8 million).

1 unchanged sentence

The fair value of shares vested during the year ended December 31, 2025, amounted to $ 24.6 million (2024 - $ 14.1 million).

As at December 31, 2024, an aggregate of 128,642 vested RSUs were being processed and due to be converted into common shares.

As at December 31, 2025, an aggregate of 81,198 vested RSUs were being processed and due to be converted into common shares (December 31, 2024:

128,642 units).

Employee Stock Purchase Plan

1 unchanged sentence

As of December 31, 2025, there were a total of 14,395,117 common shares reserved for issuance under the ESPP out of which 14,016,582 common shares remained available for future issuance under the ESPP.

These amounts include 3,065,587 shares added to the ESPP in January 2024 pursuant to the ESPP’s automatic annual increase provision.

Under the ESPP, the number of shares reserved for issuance is subject to an annual increase provision which provides that on the first day of each of the Company’s fiscal years starting in 2022, common shares equal to the lesser of (i) 1 % percent of the common shares outstanding on the last day of the immediately preceding fiscal year, or (ii) such lesser number of shares as is determined by the board of directors will be added to the ESPP.

TMC the metals company Inc.

Notes to Consolidated Financial Statements

(in thousands of US Dollars, except share, per share amounts and unless otherwise stated)

Participation in the ESPP is available to all full-time and certain part-time employees, subject to certain conditions.

11 unchanged sentences

47,809 common shares) to its employees as part of its ESPP program.

The Company recognizes share-based compensation for its ESPP based on the purchase discount, which is amortized on a straight-line basis over the purchase period.

A total of $ 27 thousand was charged to the statement of loss and comprehensive loss as share-based compensation expense for the year ended December 31, 2025, representing the share price purchase discount offered by the Company (2024:

3 unchanged sentences

$ 18 thousand).

TMC the metals company Inc.

Notes to Consolidated Financial Statements

(in thousands of US Dollars, except share, per share amounts and unless otherwise stated)

Loss per Share

11 unchanged sentences

Total anti-dilutive common equivalent shares

TMC the metals company Inc.

Notes to Consolidated Financial Statements

(in thousands of US Dollars, except share, per share amounts and unless otherwise stated)

Financial Instruments

The following table presents the Company’s financial instruments, including those measured at fair value on a recurring basis and their classification within the fair value hierarchy.

Categories of Financial Instruments

3 unchanged sentences

Amortized cost

Taxes and other receivables (Note 6)

Commodity taxes and other receivables (Note 6)

Financial liabilities

Amortized cost

Accounts payable and accrued liabilities

Accounts payable and accrued liabilities (Note 13)

Short-term debt

Fair value through profit or loss

Royalty liability

Warrants liability

Royalty liability (Note 10)

Warrants liability (Note 16)

Related Party Transactions

One of the Company’s subsidiaries has a consulting agreement with SSCS Pte.

(“SSCS”) to manage offshore engineering studies.

A director of DGE is employed through SSCS.

Consulting services during the year ended December 31, 2024, totaled $ 75 thousand, (2023:

$ 212 thousand), out of which a total of $ 53 thousand (2023:

$ 170 thousand), is disclosed as exploration labor within exploration and evaluation expenses (Note 10) and $ 22 thousand is disclosed as general and administrative expenses (2023:

$ 42 thousand).

As at December 31, 2024, the amount payable to SSCS was $nil (December 31, 2023 - $ 17 thousand).

One of the Company’s directors, who was appointed at the Company’s annual general meeting held on May 31, 2024, is the Chairman of Stonehaven Campaigns Limited and Robertsbridge Consultants Limited, which provide the Company with consulting

TMC the metals company Inc.

Notes to Consolidated Financial Statements

(in thousands of US Dollars, except share, per share amounts and unless otherwise stated)

From May 31, 2024, until December 31, 2024, Stonehaven Campaigns Limited and Robertsbridge Consultants Limited, provided consulting services amounting to $ 18 thousand and $ 26 thousand respectively, recorded in general and administrative expenses.

As at December 31, 2024, the amount payable to both Stonehaven Campaigns Limited and Robertsbridge Consultants Limited was $nil.

On January 30, 2024, as part of the Registered Direct Offering (Note 13), the Company received the remaining committed funding of $ 9 million from ERAS Capital LLC, the investment fund of one of the Company’s directors.

On March 22, 2024, the Company entered into an Unsecured Credit Facility (the “2024 Credit Facility”) with Gerard Barron, the Company’s Chief Executive Officer and Chairman, and ERAS Capital LLC, the family fund of one of the Company’s directors, (collectively, the “2024 Lenders”), pursuant to which, the Company may borrow from the 2024 Lenders up to $ 20 million in the aggregate ($ 10 million from each of the 2024 Lenders), from time to time, subject to certain conditions.

1 unchanged sentence

The Company will pay an underutilization fee equal to 4.0 % per annum payable semi-annually for any amounts that remain undrawn under the 2024 Credit Facility.

The Company has the right to pre-pay the entire amount outstanding under the 2024 Credit Facility at any time, before the 2024 Credit Facility’s maturity of September 22, 2025.

The 2024 Credit Facility also contains customary events of default.

The 2024 Credit Facility will terminate automatically if the Company or any of its subsidiaries raise at least $ 50 million in the aggregate (i) through the issuance of any of the Company’s or its subsidiaries’ debt or equity securities, or (ii) in prepayments under an off-take agreement or similar commercial agreement.

On August 13, 2024, the Company entered into the First Amendment to the 2024 Credit Facility with the 2024 Lenders, to increase the borrowing limit of the 2024 Credit Facility to $ 25 million in the aggregate ($ 12.5 million from each of the 2024 Lenders).

Under the terms of the First Amendment, the borrowing limit will return to $ 20 million in the aggregate ($ 10 million from each of the 2024 Lenders) upon certain financing events.

On November 14, 2024, the Company entered into the Second Amendment to the 2024 Credit Facility with the 2024 Lenders, to increase the borrowing limit to $ 38 million in the aggregate ($ 19 million from each of the 2024 Lenders) and to extend the maturity of the 2024 Credit Facility to December 31, 2025 .

As per the Second Amendment, the rate of underutilization fee was retroactively increased from March 22, 2024, to 6.5 % on any undrawn amounts under the 2024 Credit Facility.

On March 26, 2025, the Company entered into the Third Amendment to the 2024 Credit Facility with the 2024 Lenders, to, among other things, increase the borrowing limit to $ 44 million in the aggregate ($ 22 million from each of the 2024 Lenders) and extend the maturity of the 2024 Credit Facility to June 30, 2026 .

During the year ended December 31, 2024, the Company has drawn $ 4.3 million from the 2024 Credit Facility and incurred $ 0.2 million as interest expense.

During 2024, the Company incurred $ 1.1 million, as underutilization fees, which would be payable only in the event the 2024 Credit Facility is not drawn down at the time such fees are payable.

During the year, the Company repaid interest amounting to $ 25 thousand, and underutilization fees amounting to $ 0.1 million to the 2024 Lenders.

On January 31, 2025, the Company repaid the drawn amount and outstanding interest on the 2024 Credit Facility amounting to $ 1.8 million and $ 0.1 million, respectively.

Apart from the above-mentioned transactions, the Company had transactions with Allseas which are detailed in Note 8 and issued share-based grants to the Company’s directors which are detailed in Note 17.

Commitments and Contingent Liabilities

NORI Exploration Contract

NORI is currently implementing its approved 2022 to 2026 five-year plan.

The cost of the estimated work plan for 2025 onwards is dependent on the ISA’s approval of the NORI Area D exploitation application.

Should the approval of NORI’s exploitation application for NORI Area D be delayed or rejected, NORI intends to revise its estimated future work plan in respect of its NORI Area.

Work plans are reviewed annually by the Company, agreed with the ISA and may be subject to change depending on the Company’s progress to date.

NORI’s exploration contract expires on July 21, 2026.

NORI is required to submit an application for

As per the Third Amendment to the 2024 Credit Facility, the underutilization fees are to be paid quarterly in cash or shares at the 2024 Lenders election and the 2024 Lenders have an option to terminate the credit facility upon certain financing events.

During the year ended December 31, 2025, the Company repaid $ 4.3 million respectively of the drawn amount and did not draw from the 2024 Credit Facility any further (December 31, 2024:

The Company drew $ 4.3 million from the 2024 Credit Facility and made no repayments).

For the year ended December 31, 2025, the Company incurred $ 0.1 million as interest expense, and $ 2.6 million as underutilization fees (December 31, 2024, the interest incurred amounted to $ 0.2 million and underutilization fees incurred amounted to $ 1.1 million).

In 2025, the Company repaid interest amounting to $ 0.4 million (December 31, 2024:

$ 25 thousand), and underutilization fees amounting to $ 2.8 million (December 31, 2024:

$ 0.1 million).

As of December 31, 2025, the amount payable as underutilization fees was $ 0.7 million and was recorded as accounts payable (Note 13).

TMC the metals company Inc.

1 unchanged sentence

(in thousands of US Dollars, except share, per share amounts and unless otherwise stated)

extension no later than six months before the expiration of the contract.

NORI intends to submit an application for a five-year extension in 2025.

The 2025 Registered Direct Offering included $ 20 million from the participation of parties related with one of the Company’s directors appointed in the Annual General Meeting held in the second quarter of 2025.

During the second quarter of 2025, the Company entered into consulting agreements with two individuals who subsequently became directors to provide strategic advisory services to the Company.

The consideration for the consulting services provided by the directors was in the form of RSUs and stock options (Note 18).

During the year ended December 31, 2025, the Company incurred consulting fees of $ 0.3 million paid to immediate family members of management, which are included in general and administrative expenses (2024:

$ 0.1 million).

As at December 31, 2025, consulting fees payable to immediate family members of management was $ 57 thousand (2024:

$ 14 thousand).

One of the Company’s directors is the Chairman of Robertsbridge Consultants Limited, which provides the Company with consulting services.

During the year ended December 31, 2025, Robertsbridge Consultants Limited provided consulting services amounting to $ 5 thousand, recorded in general and administrative expenses (2024:

$ 26 thousand).

As at December 31, 2025 , the amount payable to Robertsbridge Consultants Limited was $ nil .

Commitments and Contingent Liabilities

NORI Exploration Contract

As part of the NORI Exploration Contract with the ISA, NORI submitted a periodic review report to the ISA which included a five-year plan covering 2022 to 2026:

NORI is currently implementing its approved five-year plan.

NORI’s exploration contract expires on July 21, 2026.

NORI submitted an application for a five-year extension that is currently under review.

The cost of the proposed five-year plan of work included in NORI’s extension application is dependent on the ISA’s approval of the NORI extension.

Work plans are reviewed annually by NORI, agreed with the ISA and may be subject to change depending on NORI’s progress to date.

TOML Exploration Contract

TOML is currently implementing its approved 2022 to 2026 five-year plan, which included an estimated five-year expenditure of up to $ 44 million.

As part of the TOML Exploration Contract with the ISA, TOML submitted a periodic review report to the ISA which included a five-year plan covering 2022 to 2026:

TOML is currently implementing its approved plan, which included an estimated five-year expenditure of up to $ 44 million.

The five-year estimated expenditure is indicative and subject to change, TOML will review the program regularly and TOML will inform the ISA of any changes through its annual reports.

TOML’s exploration contract expires on January 10, 2027.

TOML is required to submit an application for extension no later than six months before the expiration of the contract.

TOML intends to submit an application for a five-year extension in 2026.

Offtake Agreements

4 unchanged sentences

Glencore may also terminate the agreement by giving twelve months’ notice.

Sponsorship Agreements

On July 5, 2017, Nauru, the Nauru Seabed Minerals Authority and NORI entered into a sponsorship agreement formalizing certain obligations of the parties in relation to NORI’s exploration and potential exploitation of the NORI Area.

Upon reaching the minimum recovery level within the exploitation contract area, NORI will pay Nauru a seabed mineral recovery payment based on the polymetallic nodules recovered from the exploitation contract area.

In addition, NORI will pay an administration fee each year to Nauru for such administration and sponsorship, which is subject to review and increase in the event NORI is granted an ISA exploitation contract.

NORI has begun discussions with the Government of Nauru to renegotiate the existing sponsorship agreement and has also committed to ensuring NORI pays corporate income tax within Nauru.

On March 8, 2008, Tonga and TOML entered into a sponsorship agreement formalizing certain obligations of the parties in relation to TOML’s exploration and potential exploitation of the TOML Area (“TOML Sponsorship Agreement”).

Upon reaching the minimum recovery level within the exploitation contract area, TOML has agreed to pay Tonga a seabed mineral recovery payment based on the polymetallic nodules recovered from the exploitation contract area.

In addition, TOML has agreed to pay reasonable direct costs incurred by Tonga to administer the obligations of Tonga to the ISA.

On September 23, 2021, the Company and Tonga updated the TOML Sponsorship Agreement harmonizing the terms of its engagement with TOML with those held by NORI with Nauru.

TOML expects to renegotiate the existing sponsorship agreement with Tonga prior to entering into operations in the TOML area and has committed to paying corporate income tax within Tonga.

Contingent Liability

On October 28, 2021, a shareholder filed a putative class action against the Company, one of the Company’s executives and a former director in federal district court for the Eastern District of New York, captioned Caper v.

TMC the metals company Inc.

F/K/A Sustainable Opportunities Acquisition Corp., Gerard Barron and Scott Leonard.

The complaint alleges that all defendants violated Section 10(b) of the Exchange Act and Rule 10b-5 promulgated thereunder, and Messrs.

Barron and Leonard violated Section 20(a) of the Exchange Act, by making false and/or misleading statements and/or failing to disclose information about the Company’s operations and prospects during the period from March 4, 2021 and October 5, 2021.

On November 15, 2021, a second complaint containing substantially the same allegations was filed, captioned Tran v.

TMC the Metals Company, Inc.

These cases have been consolidated.

On March 6, 2022, a lead plaintiff was selected.

An amended complaint was filed on May 12, 2022, reflecting substantially similar allegations, with the Plaintiff seeking to recover compensable damages caused by the alleged wrongdoings.

The Company denies any allegations of wrongdoing and filed and served the plaintiff a motion to dismiss on July 12, 2022 and intend to defend against this lawsuit.

On July 12, 2023, an oral hearing on the motion to dismiss was held.

The parties are

Notes to Consolidated Financial Statements

(in thousands of US Dollars, except share, per share amounts and unless otherwise stated)

Sponsorship Agreements

On July 5, 2017, the Republic of Nauru, the Nauru Seabed Minerals Authority and NORI entered into a sponsorship agreement (the “NORI Sponsorship Agreement”) formalizing certain obligations of the parties in relation to NORI’s exploration and potential collection of nodules within the NORI Contract Area of the CCZ.

On May 29, 2025 the Republic of Nauru and NORI signed a revised Sponsorship Agreement, updating the terms of the Agreement signed between the parties in 2017.

The revised Sponsorship Agreement will remain in force unless terminated by mutual agreement of the parties or earlier terminated in accordance with its terms, including in the event of a material breach by either party or upon the assignment of NORI’s rights and the transfer of sponsorship to another sponsoring State.

Under the agreement, NORI will pay the Republic of Nauru a seabed mineral recovery payment of $ 2 per tonne of polymetallic nodules recovered under an ISA contract, subject to annual inflation adjustment.

In addition, NORI will pay an annual administration fee, initially capped at $ 500,000 , to support the Republic’s administration of its sponsorship and regulatory oversight.

The agreement also provides for potential continuity payments to the Republic with the applicable payment amounts and schedule to be determined in accordance with the terms of the agreement.

During any period in which such continuity payments are made, NORI has agreed to maintain an office in Nauru and make annual investments in local presence, community initiatives and training and capacity-building programs for Nauruan nationals.

In connection with the revised Sponsorship Agreement, the Company issued to the Republic of Nauru warrants to purchase common shares of the Company on terms previously disclosed.

On March 8, 2008, Tonga and TOML entered into the TOML Sponsorship Agreement formalizing certain obligations of the parties in relation to TOML’s exploration and potential exploitation of a proposed application to the ISA (subsequently granted) known as the TOML Area.

TOML updated the sponsorship agreement with Tonga in September 2021 and again on August 4, 2025.

The revised Sponsorship Agreement between the Government of the Kingdom of Tonga, and TOML will remain in force unless terminated by mutual agreement of the parties or earlier terminated in accordance with its terms, including in the event of a material breach by either party.

Under the agreement, the Kingdom of Tonga will continue to sponsor TOML’s seabed mineral activities in the ISA contract area.

Upon commencement of commercial recovery of polymetallic nodules under an ISA contract, TOML will pay the Tonga Seabed Minerals Authority a commercial recovery payment of $ 2 per tonne of polymetallic nodules recovered from the contract area, subject to annual inflation adjustment.

In addition, TOML will pay an annual administration fee of $ 90,000 , which may increase by up to 5 % annually, to support the administration of Tonga’s sponsorship and regulatory oversight.

The agreement also provides for potential continuity benefit payments to Tonga.

The applicable payment amounts and schedule will be determined in accordance with the terms of the agreement.

During any period in which such continuity benefits are provided, TOML has agreed to maintain an office in Tonga and make annual investments in local presence, community initiatives and training and capacity-building programs for Tongan nationals.

TMC the metals company Inc.

1 unchanged sentence

(in thousands of US Dollars, except share, per share amounts and unless otherwise stated)

currently awaiting a ruling.

There is no assurance, however, that the Company or the other defendants will be successful in the Company’s defense of this lawsuit or that insurance will be available or adequate to fund any settlement or judgment or the litigation costs of this action.

If the motion to dismiss is unsuccessful, there is a possibility that the Company may incur a loss in this matter.

Such losses or range of possible losses cannot be reliably estimated.

A resolution of this lawsuit adverse to the Company or the other defendants, however, could have a material effect on the Company’s financial position and results of operations in the period in which the lawsuit is resolved.

Contingent Liability

On January 23, 2023, investors in the 2021 private placement from the Business Combination filed a lawsuit against the Company in the Commercial Division of New York Supreme Court, New York County, captioned Atalaya Special Purpose Investment Fund II LP et al.

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On December 7, 2023, the Court granted the Company’s motion to dismiss the claim for breach of the covenant of good faith and fair dealing and denied the Company’s motion to dismiss the breach of the Subscription Agreement claim.

The Company filed a notice of appeal regarding the Court’s denial of our motion to dismiss the breach of the Subscription Agreement claim.

The Company filed a notice of appeal regarding the Court’s denial of the Company’s motion to dismiss the breach of the Subscription Agreement claim.

The appeal was heard on November 8, 2024.

The NY Appellate Division upheld the lower court’s ruling in December 2024, moving the case into the discovery phase.

There is no assurance that the Company will be successful in our defense of this lawsuit or that insurance will be available or adequate to fund any settlement or judgment or the litigation costs of this action.

The NY Appellate Division upheld the lower court’s ruling in December 2024, moving the case into the discovery phase, which is currently ongoing.

At this time no further court proceedings or trial date have been set.

There is no assurance that the Company will be successful in its defense of this lawsuit or that insurance will be available or adequate to fund any settlement or judgment or the litigation costs of this action.

Such losses or range of possible losses cannot be reliably estimated.

On November 8, 2024, a shareholder filed a putative class action against the Company and certain of its executives in federal district court for the Central District of California, captioned Lin v.

On November 8, 2024, a shareholder filed a putative class action against the Company and certain executives in federal district court for the Central District of California, captioned Lin v.

TMC The Metals Company Inc., Gerard Barron, and Craig Shesky.

The complaint alleges that all defendants violated Section 10(b) of the Exchange Act and Rule 10b-5 promulgated thereunder, and Messrs.

Barron and Shesky violated Section 20(a) of the Exchange Act, by making false and/or misleading statements and/or failing to disclose information regarding the classification of the non-financial asset received from our partnership with Low Carbon Royalties Inc.

Barron and Shesky violated Section 20(a) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”) by making false and/or misleading statements and/or failing to disclose information regarding the classification of the non-financial asset received from the Company’s partnership with Low Carbon Royalties Inc.

and the derecognition of the capitalized exploration contract related to NORI.

The alleged misstatements and omissions pertain to the Company’s initial classification of this non-financial asst as a gain on disposition (being a sale of future revenue) and subsequent reclassification thereof as a royalty liability (and re-capitalization of the exploration contract) and the restatement of our previously issued financial statements as a result thereof for the three months ended March 31, 2023, the six months ended June 30, 2023 and the nine months ended September 30, 2023 in March 2024.

The alleged misstatements and omissions pertain to our initial classification of this non-financial asset as a gain on disposition (being a sale of future revenue) and subsequent reclassification thereof as a royalty liability (and re-capitalization of the exploration contract) and the restatement of the Company’s previously issued financial statements as a result thereof for the three months ended March 31, 2023, the six months ended June 30, 2023 and the nine months ended September 30, 2023 in March 2024.

The complaint purports to represent a class of shareholders who acquired the Company’s securities between May 12, 2023, and March 25, 2024, and seeks to recover compensable damages caused by the alleged wrongdoings.

1 unchanged sentence

An amended complaint was filed on March 6, 2025.

Pursuant to court-approved scheduling, we are expected to serve a motion to dismiss by April 10, 2025, the lead plaintiff is expected to file an opposition by May 15, 2025, and we are expected to reply by June 5, 2025.

The Company intends to defend against the lawsuit.

There can be no assurance, however, that the Company will be successful in its defense, or that insurance will be available or adequate to fund any settlement or judgment or the litigation costs of this action.

Due to the early stage of this litigation, such losses or range of possible losses cannot be reliably estimated.

Fair Value Accounting

The following tables set forth the Company’s assets and liabilities measured at fair value (Note 3):

Fair Value at December 31, 2024

Receivables and prepayments

Exploration contracts

Pursuant to court-approved scheduling, the Company filed a motion to dismiss on April 10, 2025.

The lead plaintiff filed an opposition on May 15, 2025, and the Company filed its reply on June 5, 2025.

On June 18, 2025, the Court granted the Company’s motion to dismiss in full but granted plaintiffs leave to amend.

The plaintiffs filed a Second Amended Complaint on July 2, 2025.

The Company’s motion to dismiss the Second Amended Complaint was filed on August 6, 2025, the plaintiff’s opposition was filed on September 9, 2025, and the Company’s reply was filed by September 23, 2025.

On January 20, 2026, the Court granted the Company’s motion to dismiss with prejudice, and the case was dismissed in its entirety.

No appeal was filed, and the matter is now considered closed.

On January 16, 2026, American Metal Inc.

and American Metal Resources LLC filed a civil claim against TMC The Metals Company Inc.

and The Metals Company USA LLC in the Supreme Court of British Columbia, Vancouver Registry, captioned American Metal Inc.

and American Metal Resources LLC v.

TMC The Metals Company Inc.

and The Metals Company USA LLC, No.

The complaint alleges, among other things, breach of contract, breach of confidence and related claims arising from discussions between the parties regarding potential collaboration and the submission of applications for deep seabed mineral exploration licenses to the NOAA.

On March 3, 2026, the Company filed a response denying the material allegations and asserting a counterclaim against Robert Heydon and the plaintiffs alleging, among other things, breach of contract, breach of confidence and breach of fiduciary duty in connection with the alleged misuse of the Company’s confidential information.

The litigation is in its early stages and no trial date has been set.

The Company intends to vigorously defend against the claims and pursue our counterclaim.

At this time, the Company is unable to estimate the potential loss, if any, associated with this matter.

TMC the metals company Inc.

Notes to Consolidated Financial Statements

(in thousands of US Dollars, except share, per share amounts and unless otherwise stated)

Right of use asset

Accounts payable and accrued liabilities

Short-term debt

Deferred tax liability

Royalty liability

Warrants liability

Fair Value at December 31, 2023

Receivables and prepayments

Exploration contracts

Right of use asset

Accounts payable and accrued liabilities

Deferred tax liability

Royalty liability

Warrants liability

Segmented Information

The Company’s business consists of only one operating segment, namely exploration of seafloor polymetallic nodules, which includes the development of a metallurgical process to treat such seafloor polymetallic nodules.

The Company’s Chief Executive Officer is the chief operating decision maker (“CODM”) and reviews financial information on a consolidated basis to allocate resources and assess performance.

Accordingly, the Company operates as a single operating and reportable segment, namely exploration of seafloor polymetallic nodules, which includes the development of a metallurgical process to treat such seafloor polymetallic nodules.

Details on the geographical segmentation of the Company’s long-lived assets based on where each legal entity is domiciled are as follows:

1 unchanged sentence

December 31, 2024

Reconciliation of Effective Tax Rate

The Company is subject to Canadian federal statutory tax for the estimated assessable profit for the years ended December 31, 2025 at a rate of 25 %.

The Company has made no assessable profit during the abovementioned years.

TMC the metals company Inc.

1 unchanged sentence

(in thousands of US Dollars, except share, per share amounts and unless otherwise stated)

Reconciliation of Effective Tax Rate

The Company is subject to Canadian federal and provincial tax for the estimated assessable profit at a rate of 26.72 % for the year ended December 31, 2024 (2023:

The Company had no assessable profit in Canada for all periods disclosed.

The income tax expense at statutory rates for the Company can be reconciled to the reported loss for the years 2024 and 2023 per the statement of loss and comprehensive loss as follows:

For the year ended

Loss for the year, before taxes

Canadian Federal and Provincial income tax rates

Income tax recovery based on the above rates

Permanent differences

Effect of differences in future and foreign tax rates

Valuation allowance changes affecting the provision of income taxes

Total income taxes

(1) Comparative amounts for the year ended December 31, 2023 are restated based on actual tax returns filed.

The tax expense at statutory rates for the Company can be reconciled to the reported loss for the years 2025 and 2024 per the statement of loss and comprehensive loss as follows:

December 31, 2025

December 31, 2024 (1)

Net income (loss) before tax

Canadian federal statutory tax rates

State and local income taxes, net of federal income tax effect

Provincial and local rates (net of federal income tax effects)

Total federal, state and local income tax

Foreign tax effects

United States

Statutory tax rate difference between United States and Canada

Other foreign jurisdictions

Statutory tax rate difference between other jurisdictions and Canada

Total foreign tax effects

Effect of changes in tax laws or rates enacted in the current period

Non-taxable or Non-deductible Items

Stock based compensation

Change in fair value of warrant liability

Change in fair value of royalty liability

Total Non-taxable or non-deductible items

Prior year’s adjustments relating to tax provision and tax returns

Change in unrecognized deferred tax assets

Other adjustments

Income tax expense

The Company adopted ASU 2023-09 prospectively in 2025, as permitted by the standard.

Accordingly, the prior period comparative information has not been recast to conform to the current presentation.

TMC the metals company Inc.

Notes to Consolidated Financial Statements

(in thousands of US Dollars, except share, per share amounts and unless otherwise stated)

The majority (>50%) of the statutory tax impact on state and local tax expense arises from taxation in Canada, the United States and NORI:

Statutory rate

United States

The Company currently has no uncertain tax positions and is therefore not reflecting any adjustments.

8 unchanged sentences

Deferred tax asset recognized

Deferred Tax Liability

Deferred Tax Liabilities

Difference between the book value and the tax basis of the TOML exploration contract (Note 11)

Deferred tax liability recognized

TMC the metals company Inc.

Notes to Consolidated Financial Statements

(in thousands of US Dollars, except share, per share amounts and unless otherwise stated)

Deferred tax liabilities recognized

Net deferred tax assets (liabilities)

In assessing the recoverability of deferred tax assets, management considers whether it is more likely than not that some portion or all of the deferred tax assets will be realized.

The ultimate realization of deferred tax assets is dependent upon the generation of future taxable income during the periods in which those temporary differences become deductible.

A valuation allowance is provided against deferred income tax assets where it is not more likely than not that the Company will realize its benefits.

Deductible temporary differences, unused tax losses and unused tax credits are as follows:

5 unchanged sentences

Not applicable

Share issuance costs

Share issuance costs and others

Restricted interest and financing expenses

1 unchanged sentence

As at December 31, 2025, the Company had non-capital loss carry-forwards of $ 161.3 million that may be used to offset future taxable income.

TMC the metals company Inc.

Notes to Consolidated Financial Statements

(in thousands of US Dollars, except share, per share amounts and unless otherwise stated)

These losses, if not utilized, will expire as follows:

7 unchanged sentences

As at December 31, 2025, the 2025 tax year filings for the Company and its subsidiaries (where applicable) remain unfiled and have not been assessed by the relative tax authorities.

Subsequent Events

On March 24, 2025, we entered into a Letter Agreement (the “Letter Agreement”) with Allseas Investments and Argentum Cedit Virtuti GCV, pursuant to which the repayment date under our Working Capital Loan agreement with Allseas Investments dated September 9, 2024 was extended to September 30, 2025.

Additionally, under the Letter Agreement, we and Argentum Cedit Virtuti GCV agreed to cancel the unsecured credit facility established in 2023 with no outstanding amounts remaining, other than our obligation to pay the underutilization fee thereunder.

On March 27, 2025, the Company announced that it initiated a process with the U.S.

National Oceanic and Atmospheric Administration and the U.S.

Department of Commerce under the U.S.

Deep Seabed Hard Mineral Resources Act to consider a U.S.-based regulatory pathway for the commercial production of deep-sea polymetallic nodules in the CCZ.

Subsequent Event

On March 25, 2026, the 2024 Lenders extended the maturity date of the 2024 Credit Facility by one year, expiring on June 30, 2027, subject to further extension to June 30, 2028 at the election of the 2024 Lenders.

CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-K

Item 8. Financial Statements and Supplementary Data