TMC the metals Co Inc. 10-Q

Item 1. Financial Statements TMC the metals company Inc. Condensed Consolidated Balance Sheets (in thousands of US Dollars, except share amounts) (Unaudited) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ As at ​ As at ​ ​ March 31, December 31, ASSETS Note 2025 2024 Current ​ ​ ​ ​ ​ Cash ​ ​ ​ $ 2,346 $ 3,480 Receivables and prepayments ​ ​ ​ 5,012 ​ 1,851 ​ ​ ​ ​ 7,358 ​ 5,331 Non-current ​ ​ ​ ​ ​ ​ Exploration assets ​ ​ 42,951 ​ 42,951 Equipment ​ ​ ​ 713 ​ 771 Software development costs ​ ​ ​ ​ 1,958 ​ ​ 1,928 Right-of-use asset ​ 6 ​ ​ 3,337 ​ ​ 3,814 Investment ​ 7 ​ ​ 8,168 ​ ​ 8,203 ​ ​ ​ ​ 57,127 ​ 57,667 ​ ​ ​ ​ ​ ​ ​ ​ ​ TOTAL ASSETS ​ ​ ​ $ 64,485 $ 62,998 ​ ​ ​ ​ ​ ​ ​ ​ ​ LIABILITIES ​ ​ ​ ​ ​ ​ Current ​ ​ ​ ​ ​ ​ Accounts payable and accrued liabilities 9 ​ 45,245 ​ 42,754 Short-term debt ​ 6,15 ​ ​ 9,978 ​ ​ 11,775 ​ ​ ​ ​ 55,223 ​ 54,529 Non-current ​ ​ ​ ​ ​ ​ Deferred tax liability ​ ​ 10,675 ​ 10,675 Royalty liability ​ 7 ​ ​ 14,000 ​ ​ 14,000 Warrants liability 12 ​ 1,353 ​ 912 ​ ​ ​ ​ ​ 26,028 ​ ​ 25,587 ​ ​ ​ ​ ​ ​ ​ ​ ​ TOTAL LIABILITIES ​ ​ ​ $ 81,251 $ 80,116 ​ ​ ​ ​ ​ ​ ​ ​ ​ EQUITY ​ ​ ​ ​ ​ ​ Common shares (unlimited shares, no par value – issued: 356,617,022 (December 31, 2024 – 340,708,460 )) ​ ​ 495,804 ​ 477,217 Special Shares ​ ​ ​ ​ — ​ ​ — Additional paid in capital ​ ​ ​ 140,656 ​ 138,303 Accumulated other comprehensive loss ​ ​ ​ ( 1,203 ) ​ ( 1,203 ) Deficit ​ ​ ​ ( 652,023 ) ​ ( 631,435 ) TOTAL EQUITY ​ ​ ​ ( 16,766 ) ​ ( 17,118 ) ​ ​ ​ ​ ​ ​ ​ ​ ​ TOTAL LIABILITIES AND EQUITY ​ ​ ​ $ 64,485 $ 62,998 ​ Nature of Operations (Note 1) Contingent Liabilities (Note 16) Subsequent Event (Note 19) The accompanying notes are an integral part of these unaudited interim condensed consolidated financial statements. 5 Table of Contents TMC the metals company Inc. Condensed Consolidated Statements of Loss and Comprehensive Loss (in thousands of US Dollars, except share and per share amounts) (Unaudited) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Three months ended ​ Three months ended ​ ​ March 31, ​ March 31, ​ Note 2025 2024 Operating expenses ​ ​ ​ ​ Exploration and evaluation expenses 8 ​ $ 9,515 $ 18,123 General and administrative expenses ​ ​ ​ ​ 8,500 ​ 6,559 Operating loss ​ ​ ​ ​ 18,015 ​ 24,682 ​ ​ ​ ​ ​ ​ ​ ​ ​ Other items ​ ​ ​ ​ ​ ​ Equity-accounted investment loss ​ 7 ​ ​ 35 ​ ​ 78 Change in fair value of warrants liability ​ 12 ​ ​ 441 ​ ​ 531 Foreign exchange loss (gain) ​ ​ ​ 1,095 ​ ( 266 ) Interest income ​ ​ ​ ​ ( 19 ) ​ ( 102 ) Fees and interest on borrowing and credit facilities ​ 6 and 15 ​ ​ 1,021 ​ 271 ​ ​ ​ ​ ​ ​ ​ ​ ​ Loss and comprehensive loss for the period ​ ​ ​ $ 20,588 $ 25,194 ​ ​ ​ ​ ​ ​ ​ ​ ​ Loss per share ​ ​ ​ ​ ​ ​ - basic and diluted ​ ​ $ 0.06 $ 0.08 ​ ​ ​ ​ ​ ​ ​ ​ ​ Weighted average number of Common Shares outstanding – basic and diluted ​ ​ ​ 345,346,393 ​ 311,521,854 ​ The accompanying notes are an integral part of these unaudited interim condensed consolidated financial statements. ​ ​ 6 Table of Contents TMC the metals company Inc. Condensed Consolidated Statements of Changes in Equity (in thousands of US Dollars, except share amounts) (Unaudited) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Accumulated ​ ​ ​ ​ ​ ​ ​ ​ Common Shares ​ ​ ​ ​ Additional ​ Other ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Special ​ Paid in ​ Comprehensive ​ ​ ​ ​ ​ ​ Three months ended March 31, 2025 Shares ​ Amount Shares Capital Loss Deficit Total December 31, 2024 ​ 340,708,460 ​ $ 477,217 ​ $ — $ 138,303 $ ( 1,203 ) $ ( 631,435 ) $ ( 17,118 ) Issuance of shares and warrants under Registered Direct Offering, net of expenses (Note 10) ​ 5,000,000 ​ ​ 2,237 ​ ​ — ​ ​ 2,763 ​ ​ — ​ ​ — ​ ​ 5,000 Shares issued as per At-the-Market Equity Distribution Agreement (Note 11) ​ 2,975,226 ​ ​ 5,562 ​ ​ — ​ ​ — ​ ​ — ​ ​ — ​ ​ 5,562 Conversion of restricted share units, net of shares withheld for taxes (Note 13) ​ 7,933,336 ​ ​ 10,788 ​ ​ — ​ ​ ( 10,788 ) ​ ​ — ​ ​ — ​ ​ — Share-based compensation and Expenses settled with equity (Note 13) ​ — ​ ​ — ​ ​ — ​ ​ 10,378 ​ ​ — ​ ​ — ​ ​ 10,378 Loss for the period ​ — ​ ​ — ​ ​ — ​ — ​ — ​ ( 20,588 ) ​ ( 20,588 ) March 31, 2025 ​ 356,617,022 ​ $ 495,804 ​ $ — $ 140,656 $ ( 1,203 ) $ ( 652,023 ) $ ( 16,766 ) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Accumulated ​ ​ ​ ​ ​ ​ ​ ​ Common Shares ​ ​ ​ Additional Other ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Special ​ Paid in ​ Comprehensive ​ ​ ​ ​ ​ ​ Three months ended March 31, 2024 Shares Amount Shares Capital Loss Deficit Total December 31, 2023 ​ 306,558,710 ​ $ 438,239 ​ $ — ​ $ 122,797 ​ $ ( 1,216 ) ​ $ ( 548,902 ) ​ $ 10,918 Issuance of shares and warrants under Registered Direct Offering, net of expenses 4,500,000 ​ ​ 7,447 ​ ​ — ​ 1,553 ​ — ​ — ​ 9,000 Exercise of stock options ​ 120,000 ​ ​ 144 ​ ​ — ​ ​ 46 ​ ​ — ​ ​ — ​ ​ 190 Conversion of restricted share units, net of shares withheld for taxes ​ 7,112,673 ​ ​ 8,601 ​ ​ — ​ ​ ( 8,601 ) ​ ​ — ​ ​ — ​ ​ — Share-based compensation and Expenses settled with equity — ​ ​ — ​ ​ — ​ 6,896 ​ — ​ — ​ 6,896 Loss for the period — ​ ​ — ​ ​ — ​ — ​ — ​ ( 25,194 ) ​ ( 25,194 ) March 31, 2024 318,291,383 ​ $ 454,431 ​ $ — $ 122,691 $ ( 1,216 ) $ ( 574,096 ) $ 1,810 ​ The accompanying notes are an integral part of these unaudited interim condensed consolidated financial statements. ​ ​ ​ 7 Table of Contents TMC the metals company Inc. Condensed Consolidated Statements of Cash Flows (in thousands of US Dollars) (Unaudited) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Three months ended ​ Three months ended ​ ​ March 31, March 31, ​ Note 2025 2024 Cash provided by (used in) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Operating activities ​ ​ ​ ​ ​ ​ ​ Loss for the period ​ ​ $ ( 20,588 ) $ ( 25,194 ) Items not affecting cash: ​ ​ ​ ​ ​ ​ Amortization ​ ​ ​ ​ 58 ​ ​ 85 Accrued interest on credit facilities ​ ​ ​ ​ 558 ​ ​ ​ Lease expense ​ 6 ​ ​ 477 ​ ​ 477 Share-based compensation and expenses settled with equity ​ 13 ​ ​ 10,378 ​ ​ 6,896 Equity-accounted investment loss 7 ​ ​ 35 ​ 78 Change in fair value of warrants liability 12 ​ ​ 441 ​ 531 Unrealized foreign exchange movement ​ ​ ​ ​ 2,345 ​ ​ ( 293 ) Interest paid short-term debt ​ 15 ​ ​ ( 103 ) ​ ​ — Changes in working capital: ​ ​ ​ ​ ​ ​ Receivables and prepayments ​ ​ ​ ( 3,161 ) ​ 25 Accounts payable and accrued liabilities ​ ​ ​ 213 ​ 5,543 Net cash used in operating activities ​ ​ ​ ​ ( 9,347 ) ​ ( 11,852 ) ​ ​ ​ ​ ​ ​ ​ ​ ​ Investing activities ​ ​ ​ ​ ​ ​ Acquisition of equipment and software ​ ​ ​ ​ ( 70 ) ​ ​ ( 340 ) Net cash used in investing activities ​ ​ ​ ​ ( 70 ) ​ ( 340 ) ​ ​ ​ ​ ​ ​ ​ ​ ​ Financing activities ​ ​ ​ ​ ​ ​ Proceeds from registered direct offering ​ 10 ​ ​ 5,000 ​ ​ 9,000 Expenses paid for registered direct offering ​ 10 ​ ​ ( 472 ) ​ ​ ( 142 ) Proceeds from Shares issued from ATM ​ 11 ​ ​ 5,562 ​ ​ — Repayment of Debt ​ 15 ​ ​ ( 1,797 ) ​ ​ — Proceeds from exercise of stock options ​ ​ ​ ​ — ​ ​ 190 Net cash provided by financing activities ​ ​ ​ ​ 8,293 ​ ​ 9,048 ​ ​ ​ ​ ​ ​ ​ ​ ​ Decrease in cash ​ ​ $ ( 1,124 ) $ ( 3,144 ) Impact of exchange rate changes on cash ​ ​ ​ ( 10 ) ​ 293 Cash - beginning of period ​ ​ ​ 3,480 ​ 6,842 Cash - end of period ​ ​ $ 2,346 $ 3,991 ​ The accompanying notes are an integral part of these unaudited interim condensed consolidated financial statements. ​ ​ ​ 8 Table of Contents TMC the metals company Inc. Notes to Interim Condensed Consolidated Financial Statements (in thousands of US Dollars, except share and per share amounts and unless otherwise stated) (Unaudited) 1. Nature of Operations TMC the metals company Inc. (“TMC” or the “Company”) was incorporated as a Cayman Islands exempted company limited by shares on December 18, 2019, 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 10th floor, 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”), with NORI Area D located approximately 1,500 miles southwest of San Diego, California. These nodules contain high grades of four metals (nickel, copper, cobalt, manganese) which can be used as (i) feedstock for battery cathode precursors (nickel, cobalt and manganese sulfates, or intermediate nickel-copper-cobalt matte or nickel-copper-cobalt alloy) for nickel-rich lithium-ion batteries, (ii) copper cathode for electric wiring, energy transmission and other applications and (iii) manganese silicate for manganese alloy production required for steel manufacturing. 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 or 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 199,895 square kilometers. The submitted commercial recovery permit application is to secure exploitation rights for a subset of the TMC USA Zone A area covering over 25,160 square kilometers. The commercial recovery application is the first submission under DSHMRA for commercial recovery of polymetallic nodules. Both Nauru Ocean Resources Inc. (NORI) and Tonga Offshore Mining Limited (TOML) continue to hold their exploration licenses granted by the International Seabed Authority (ISA) and continue pursuing their efforts under these licenses. 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 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 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. 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. ​ 9 Table of Contents TMC the metals company Inc. Notes to Interim Condensed Consolidated Financial Statements (in thousands of US Dollars, except share and per share amounts and unless otherwise stated) (Unaudited) 2. Basis of Presentation These unaudited condensed consolidated interim financial statements are prepared in accordance with U.S. Generally Accepted Accounting Principles (“U.S. GAAP”) for interim financial statements. Accordingly, certain information and footnote disclosures required by U.S. GAAP have been condensed or omitted in these unaudited condensed consolidated interim financial statements pursuant to such rules and regulation. In management’s opinion, these unaudited condensed consolidated interim financial statements include all adjustments of a normal recurring nature necessary for the fair presentation of the Company’s statement of financial position, operating results for the periods presented, comprehensive loss, shareholder’s equity and cash flows for the interim periods, but are not necessarily indicative of the results of operations to be expected for the full year ending December 31, 2025 or for any other period. These unaudited condensed consolidated interim financial statements should be read in conjunction with the audited annual consolidated financial statements for the year ended December 31, 2024. The Company has applied the same accounting policies as in the prior year. 3. 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 reflected in these condensed consolidated interim financial statements include, but are not limited to, the evaluation of going concern, the valuation of share-based payments, including valuation of stock options (Note 13), valuation of Class B warrants (Note 12) as well as the valuation of private warrants (Note 12), the valuation of the Royalty liability (Note 7) and the valuation of leases (Note 6). Actual results could differ materially from those estimates. 4. Fair Value of Financial Instruments Fair value estimates of financial instruments are made at a specific point in time, based on relevant information about financial markets and specific financial instruments. As these estimates are subjective in nature, involving uncertainties and matters of significant judgment, they cannot be determined with precision. Changes in assumptions can significantly affect estimated fair value. The Company measures fair value as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the reporting date. In accordance with US GAAP, the Company utilizes a three-tier hierarchy, which prioritizes the inputs used in the valuation methodologies in measuring fair value: ● Level 1  - Valuations based on quoted prices in active markets for identical assets or liabilities that an entity has the ability to access. ● Level 2  - Valuations based on quoted prices for similar assets or liabilities, quoted prices for identical assets or liabilities in markets that are not active, or other inputs that are observable or can be corroborated by observable data for substantially the full term of the assets or liabilities. ● Level 3  - Valuations based on inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities. In some circumstances, the inputs used to measure fair value might be categorized within different levels of the fair value hierarchy. In those instances, the fair value measurement is categorized in its entirety in the fair value hierarchy based on the lowest level input that is significant to the fair value measurement. There were no transfers between fair value measurement levels during the three months ended March 31, 2025, and 2024. 10 Table of Contents TMC the metals company Inc. Notes to Interim Condensed Consolidated Financial Statements (in thousands of US Dollars, except share and per share amounts and unless otherwise stated) (Unaudited) As at March 31, 2025, and December 31, 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 7 and Note 12, respectively. 5. Recent Accounting Pronouncements Issued and Adopted There were no recent accounting pronouncements issued and adopted by the Company during the period. 6. Strategic Alliance with Allseas 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 period ended March 31, 2025, Allseas provided the Company with engineering, project management and vessel use services consisting of lay-up and transit costs totaling $ 2.3 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 8) (For three months ended March 31, 2024: $ 3.7 million). 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. Allseas can terminate the agreement if the Company ceases normal operations, assigns assets to creditors, initiates bankruptcy proceedings, or faces unresolved bankruptcy-related actions. For the three months ended March 31, 2025, the Company has recognized $ 0.5 million as lease expense recorded as exploration and evaluation expense (For the three months ended March 31, 2024: $ 0.5 million). ​ ​ ​ ​ ​ ​ Right-of-use Asset Balance as at December 31, 2023 ​ $ 5,721 Lease expense during the year ​ 1,907 Balance as at December 31, 2024 ​ $ 3,814 Lease expense during the period ​ ​ 477 Balance as at March 31, 2025 ​ $ 3,337 ​ ​ 11 Table of Contents TMC the metals company Inc. Notes to Interim Condensed Consolidated Financial Statements (in thousands of US Dollars, except share and per share amounts and unless otherwise stated) (Unaudited) 2023 Credit Facility and Loan Agreements with Company Related to Allseas 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 24, 2025, the Company entered into a Letter Agreement with the Lender, pursuant to which the undrawn, unsecured credit facility was cancelled with the only obligation being the underutilization fees amounting to $ 2 million as payable. During the three months ended March 31, 2025 and 2024, the Company incurred $ 0.2 million as underutilization fees in both periods. 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 $ 7.5 million (the “Working Capital Loan”) 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 Lender. 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 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 being repayable on that date. For the three months ended March 31, 2025, the Company did not repay any portion of the drawn amount of $ 7.5 million and incurred $ 0.2 million as interest expense. As at March 31, 2025, the total amount payable to Allseas and its affiliates was $ 37.1 million, with $ 7.5 million of this amount recorded as short-term debt and the remaining balance recorded in accrued liabilities in the Condensed Consolidated Balance Sheet (Note 9) (December 31, 2024: $ 33.3 million, recorded as accrued liabilities and $ 7.5 million recorded as short-term debt). As at March 31, 2025, Allseas and its affiliates owned 53.8 million TMC common shares (2024: 53.8 million TMC common shares) which constituted 15.1 % (December 31, 2024: 15.8 %) of total common shares outstanding. ​ 7. Investment in Low Carbon Royalties 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 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. During the three months ended March 31, 2025, there was no change to the Company’s ownership in Low Carbon Royalties which remained at 32 % (December 31, 2024: 32 %). 12 Table of Contents TMC the metals company Inc. Notes to Interim Condensed Consolidated Financial Statements (in thousands of US Dollars, except share and per share amounts and unless otherwise stated) (Unaudited) For the three months ended March 31, 2025, the Company’s share of the net loss generated by the Low Carbon Royalties was $ 35 thousand (For the three months ended March 31, 2024: $ 78 thousand). ​ ​ ​ ​ ​ ​ Investment Investment as at December 31, 2023 ​ $ 8,429 Equity-accounted investment loss for the 2024 year ​ ​ ( 226 ) Investment as at December 31, 2024 ​ $ 8,203 Equity-accounted investment loss for the period ended March 31, 2025 ​ ​ ( 35 ) Investment as at March 31, 2025 ​ $ 8,168 ​ 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 March 31, 2025, remained unchanged at $ 14 million. ​ Financial results of Low Carbon Royalties as at and for the three months ended March 31, 2025, and 2024 are summarized below: ​ ​ ​ ​ ​ ​ ​ ​ As at March 31, As at March 31, ​ 2025 2024 Current Assets ​ $ 1,871 1,257 Non-Current Assets ​ 25,028 26,009 Current Liabilities ​ 47 86 ​ ​ ​ ​ ​ ​ ​ ​ Three months ended March 31, ​ 2025 2024 Royalty Income ​ $ 252 394 Total Revenue ​ 269 404 Comprehensive Loss for the Period ​ $ ( 110 ) ( 241 ) ​ ​ 8 . Exploration and Evaluation Expenses The detail of exploration and evaluation expenses is as follows: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Three months ended March 31, ​ 2025 2024 Environmental Studies $ 1,270 $ 1,830 Exploration Labor ​ 2,587 ​ 2,334 Share-Based Compensation (Note 13) ​ 1,928 ​ 971 Mining, Technological and Process Development ​ 2,950 ​ 11,598 Prefeasibility Studies ​ ​ 41 ​ ​ 290 Sponsorship, Training and Stakeholder Engagement ​ 633 ​ 873 Other ​ 106 ​ 227 ​ $ 9,515 $ 18,123 ​ ​ ​ 13 Table of Contents TMC the metals company Inc. Notes to Interim Condensed Consolidated Financial Statements (in thousands of US Dollars, except share and per share amounts and unless otherwise stated) (Unaudited) 9. Accounts Payable and Accrued Liabilities Accounts payable and accrued liabilities outstanding at March 31, 2025, and 2024 are as follows: ​ ​ ​ ​ ​ ​ ​ ​ ​ March 31 December 31 ​ ​ 2025 ​ 2024 Accounts Payable ​ $ 2,558 ​ $ 6,198 Accrued Liabilities (1) ​ 42,687 ​ 36,556 ​ ​ $ 45,245 ​ $ 42,754 (1) As at March 31, 2025, accrued liabilities included $ 29.6 million related to Allseas (Note 6) (December 31, 2024 - $ 25.8 million). 10. Financing Activity 2024 Registered Direct Offering In the last quarter of 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”) 19,900,000 common shares and issue Class B Warrants to purchase 9,950,000 Common Shares (“Class B Warrants”) (Note 12). 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. 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. On February 6, 2025, the Company received the final balance of committed funding from the 2024 Registered Direct Offering of $ 5 million and issued 5,000,000 common shares and 2,500,000 Class B Warrants. Out of the total $ 5 million net proceeds received in the three months ended March 31, 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 12). 11. Shares issued as per At-the-Market Equity Distribution Agreement (“ATM”) In December 2022, the Company filed a prospectus supplement with the Securities and Exchange Commission to sell up to $ 30 million of the Company’s common shares from time to time through an ATM. In the three months ended March 31, 2025, the Company issued 2,975,226 common shares (For three months ended March 31, 2024: nil ) at an average share price of $ 1.93 , resulting in net proceeds of $ 5.6 million, after incurring $ 0.2 million as commission and fees. 12 . Warrants Public Warrants As at March 31, 2025, 15,000,000 Public Warrants were outstanding (December 31, 2024 – 15,000,000 ). Public Warrants may only be exercised for a whole number of shares. The exercise price for the Public Warrants is $ 11.50 per common share. The Public Warrants will expire on September 9, 2026 or earlier upon redemption or liquidation. As at March 31, 2025, the value of outstanding Public Warrants of $ 19.5 million was recorded in additional paid in capital. 14 Table of Contents TMC the metals company Inc. Notes to Interim Condensed Consolidated Financial Statements (in thousands of US Dollars, except share and per share amounts and unless otherwise stated) (Unaudited) Private Warrants As at March 31, 2025, 9,500,000 Private Warrants were outstanding (December 31, 2024 – 9,500,000 ). The exercise price for the Private Warrants is $ 11.50 per common share. The Private Warrants will expire on September 9, 2026 or earlier upon redemption or liquidation. The Private Warrants were valued using a Black-Scholes model, which resulted in a Level 3 fair value measurement. The primary unobservable input utilized in determining the fair value of the Private Warrants was the expected volatility of the Company’s common shares. 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. As at March 31, 2025, the fair value of outstanding Private Warrants of approximately $ 1.4 million is recorded as warrants liability. The following table presents the changes in the fair value of warrants liability: ​ ​ ​ ​ ​ ​ Private ​ ​ Warrants Warrants liability as at December 31, 2024 ​ $ 912 Increase in fair value of warrants liability ​ 441 Warrants liability as at March 31, 2025 ​ $ 1,353 ​ As at March 31, 2025, the fair value of the Private Warrants was estimated using the following assumptions: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ March 31, ​ December 31, ​ ​ 2025 2024 ​ Exercise price ​ $ 11.50 ​ $ 11.50 ​ Share price ​ $ 1.72 ​ $ 1.12 ​ Volatility ​ ​ 103.44 % 108.97 % Term ​ ​ 1.44 years 1.69 years Risk-free rate ​ ​ 3.89 % 4.14 % Dividend yield ​ ​ 0.0 % 0.0 % ​ Class A Warrants As at March 31, 2025, 6,230,770 Class A Warrants were outstanding (December 31, 2024 – 6,230,770 ). Class A Warrants may only be exercised for a whole number of shares. The exercise price for the Public Warrants is $ 2 per common share. The Class A Warrants will expire on December 31, 2027 or earlier upon redemption or liquidation. As at March 31, 2025, the value of outstanding Class A Warrants of $ 5.3 million was recorded in additional paid in capital. Class B Warrants As a part of the 2024 Registered Direct Offering (Note 10), which closed in November 2024, the Company issued 7,450,000 Class A Warrants to purchase common shares at an exercise price of $ 2.00 per share. These Class B Warrants were valued on November 14, 2024, at a fair value of $ 0.60 per warrant, using a Monte Carlo valuation. As on December 31, 2024, 7,450,000 Class B Warrants were outstanding, and the Company recorded the fair value of the Class B Warrants amounting to $ 4.4 million as additional paid in capital. 15 Table of Contents TMC the metals company Inc. Notes to Interim Condensed Consolidated Financial Statements (in thousands of US Dollars, except share and per share amounts and unless otherwise stated) (Unaudited) During the three months ended March 31, 2025, the Company issued the remaining 2,500,000 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 issued was determined using a Monte Carlo simulation. The Class B Warrants were valued as follows: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ January 29, January 30, February 6, ​ ​ 2025 ​ 2025 ​ 2025 Units issued ​ 900,000 650,000 950,000 ​ Fair value per warrant ​ $ 0.98 1.11 1.22 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Assumptions used: ​ ​ ​ ​ ​ ​ ​ ​ Exercise price ​ $ 2.00 2.00 2.00 ​ Share price ​ $ 1.48 1.65 1.82 ​ Call price threshold ​ $ 5.00 5.00 5.00 ​ Volatility ​ 107.66 % 107.66 % 107.66 % Term (years) ​ 5.00 5.00 5.00 ​ Risk-free rate ​ 4.23 % 4.23 % 4.23 % Dividend yield ​ 0.0 % 0.0 % 0.0 % ​ 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. ​ Similar to the Class B Warrants issued in financial year ended December 31, 2024, the Company classified the Class B Warrants issued in the three months ended March 31, 2025, as equity (per ASC 815) and recorded the fair value of $ 2.8 million as additional paid in capital. As at March 31, 2025, the value of the outstanding 9,950,000 Class B Warrants of $ 7.2 million was recorded in 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 three months ended March 31, 2025. ​ 13 . 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 at March 31, 2025, there were a total of 70,262,856 common shares reserved for issuance under the Incentive Plan out of which 43,565,373 common shares remained available for future issuances. These amounts include 13,628,338 shares added to the Incentive Plan in January 2025 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. 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. Prior to the 2021 Incentive Plan, the Company had granted share-based awards under the 2018 Stock Option Plan (“2018 Plan”). 16 Table of Contents TMC the metals company Inc. Notes to Interim Condensed Consolidated Financial Statements (in thousands of US Dollars, except share and per share amounts and unless otherwise stated) (Unaudited) Stock options A continuity schedule summarizing the movements in the Company’s stock options under the various plans is as follows: ​ ​ ​ ​ ​ ​ ​ ​ ​ Number of Number of Number of ​ ​ Short-Term ​ Long-term ​ Options ​ ​ Options ​ Options Outstanding ​ ​ Outstanding ​ Outstanding under ​ ​ under 2018 Plan under 2018 Plan Incentive Plan Outstanding – December 31, 2023 15,074,240 9,783,922 ​ — Granted ​ — ​ — ​ 3,940,000 Expired ( 57,893 ) ( 139,048 ) ​ — Exercised ( 715,772 ) — ​ — Outstanding – December 31, 2024 14,300,575 9,644,874 ​ 3,940,000 Granted ​ — ​ — ​ 1,250,000 Outstanding – March 31, 2025 14,300,575 9,644,874 ​ 5,190,000 ​ During the three months ended March 31, 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 weighted average assumptions: ​ ​ ​ ​ ​ ​ ​ March 4, 2025 Exercise price ​ $ 1.71 ​ Share price ​ $ 1.68 ​ Volatility ​ 103.85 % Term (1) ​ 4.5 years Risk-free rate ​ 3.92 % Dividend yield ​ 0.0 % (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; and 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. ​ 17 Table of Contents TMC the metals company Inc. Notes to Interim Condensed Consolidated Financial Statements (in thousands of US Dollars, except share and per share amounts and unless otherwise stated) (Unaudited) 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. 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 the achievement of performance of these conditions at March 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 Tranche 1 and Tranche 2 options were estimated on the date of grant using the Monte Carlo method and the following assumptions: ​ ​ ​ ​ ​ ​ ​ March 14, 2025 Exercise price ​ $ 1.73 ​ Share price ​ $ 1.85 ​ Volatility ​ 100.62 % Term (1) ​ 3.22 years Risk-free rate ​ 3.93 % Dividend yield ​ 0.0 % ​ During the three months ended March 31, 2025, the Company recognized $ 0.5 million of share-based compensation expense for stock options as general and administrative expenses in the statement of loss and comprehensive loss (For the three months ended March 31, 2024, the Company recognized $ 47 thousand of share-based compensation expense for stock options of which $ 14 thousand was related to exploration and evaluation activities and $ 33 thousand was related to general and administrative expenses). The Company has not granted any options under the 2018 Plan since September 9, 2021 (date of the Business Combination) and has fully recognized the fair value of the options issued under the 2018 Plan in the prior periods. Restricted Share Units (“RSU”) The Company may, from time to time, grant RSUs to directors, officers, employees, and consultants of the Company and its subsidiaries under the 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 continuity schedule summarizing the RSU activity is as follows: ​ ​ ​ ​ ​ Number of RSUs ​ ​ Outstanding Outstanding – December 31, 2023 12,484,880 Granted 33,079,041 Forfeited ( 516,685 ) Exercised ( 10,734,581 ) Outstanding – December 31, 2024 ​ 34,312,655 Granted ​ 11,999,006 Forfeited ​ ( 456,913 ) Exercised ​ ( 7,933,336 ) Outstanding – March 31, 2025 37,921,412 ​ ​ 18 Table of Contents TMC the metals company Inc. Notes to Interim Condensed Consolidated Financial Statements (in thousands of US Dollars, except share and per share amounts and unless otherwise stated) (Unaudited) The details of RSUs granted by the Company during the period are as follows: ​ ​ ​ ​ ​ ​ ​ Three months ​ Three months ​ ​ ended March 31, ​ ended March 31, Vesting Period 2025 2024 Vesting Immediately (1) ​ 2,619,585 ​ 3,800,435 Vesting fully within the first anniversary of the grant date (2) 60,000 17,241 Vesting in thirds on each anniversary of the grant date (3) 8,818,935 7,144,348 Vesting in fourths on each anniversary of the grant date 176,302 — Vesting based on performance conditions ​ 324,184 ​ — Total Units Granted ​ 11,999,006 ​ 10,962,024 (1) Of the 2,619,585 RSUs granted during the three months ended March 31, 2025, 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. In addition, during the three months ended March 31, 2025, the Company granted 150,000 RSUs, to consultants (three months ended March 31, 2024: 46,333 RSUs) resulting in $ 0.3 million, charged as general and administrative expenses (three months ended March 31, 2024: $ 0.1 million charged as general and administrative expenses). (2) During the three months ended March 31, 2025, 60,000 RSUs vesting on July 1, 2025, were issued to a consultant, resulting in $ 24 thousand charged as general and administrative expenses. (3) The Company granted 8,818,935 RSUs, as payment for the 2024 LTIP awards (three months ended March 31, 2024: 7,144,348 RSUs were issued as payment for the 2023 LTIP awards). The grant date fair value of all RSUs granted in three months ended March 31, 2025, is equivalent to the closing share price of the Company’s common shares on the date of grant. During the three months ended March 31, 2025, a total of $ 5.4 million was charged to the statement of loss and comprehensive loss as share-based compensation expense for RSUs (three months ended March 31, 2024: $ 3.2 million) of which share-based compensation expense related to exploration and evaluation activities amounted to $ 1.9 million (three months ended March 31, 2024 - $ 1.2 million) and share-based compensation expense related to general and administration matters amounted to $ 3.5 million (three months ended March 31, 2024 - $ 2 million). As at March 31, 2025, the total unrecognized share-based compensation expense for RSUs was $ 29.4 million (December 31, 2024 - $ 20.5 million). As at March 31, 2025, an aggregate of 64,727 vested RSUs were being processed and due to be converted into common shares. Employee Stock Purchase Plan On May 31, 2022, TMC’s 2021 Employee Stock Purchase Plan (“ESPP”) was approved at the Company’s 2022 annual shareholders meeting. As at March 31, 2025, there were 14,055,707 common shares reserved for issuance under the ESPP. This included 3,407,085 shares added to the ESPP in January 2025 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. During the first quarter of 2025, a total of $ 1 thousand (three months ended March 31, 2024: $ 9 thousand) was recorded as exploration and evaluation expenses in the statement of loss and comprehensive loss as share-based compensation expense, representing the share price purchase discount offered by the Company. ​ 19 Table of Contents TMC the metals company Inc. Notes to Interim Condensed Consolidated Financial Statements (in thousands of US Dollars, except share and per share amounts and unless otherwise stated) (Unaudited) 14 . Loss per Share Basic loss per share is computed by dividing the loss by the weighted-average number of common shares of the Company outstanding during the period. Diluted loss per share is computed by giving effect to all common share equivalents of the Company, including outstanding stock options, RSUs, warrants, Special Shares and options to purchase Special Shares, to the extent these are dilutive. Basic and diluted loss per share was the same for each period presented as the inclusion of all common share equivalents would have been anti-dilutive. Anti-dilutive equivalent common shares were as follows: ​ ​ ​ ​ ​ ​ ​ ​ Three months ended ​ Three months ended ​ ​ March 31, ​ March 31, ​ 2025 2024 Outstanding options to purchase common shares ​ 29,135,449 24,599,114 Outstanding RSUs ​ 37,921,412 16,108,177 Outstanding shares under ESPP ​ 4,499 ​ 28,796 Outstanding warrants ​ 40,680,770 ​ 30,730,770 Outstanding Special Shares and options to purchase Special Shares ​ 136,011,413 ​ 136,239,964 Total anti-dilutive common equivalent shares ​ 243,753,543 207,706,821 ​ ​ 15 . Related Party Transactions 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. All amounts drawn under the 2024 Credit Facility will bear interest at the 6-month Secured Overnight Funding Rate (SOFR), 180 -day average plus 4.0 % per annum payable in cash semi - annually (or plus 5 % if paid - in - kind at maturity, at our 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 2024 Credit Facility. The 2024 Credit Facility also contains customary events of default. 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). 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 . As per the Third Amendment to the 2024 Credit Facility, the 2024 Lenders have an option to terminate the credit facility upon certain financing events. During the three months ended March 31, 2025, the Company repaid $ 1.8 million of the drawn amount and did not draw from the 2024 Credit Facility any further (For three months ended March 31, 2024, the Company did not draw or repay any amounts from the 2024 Credit Facility). For the first quarter of 2025, the Company incurred $ 0.1 million as interest expense and $ 0.5 million as underutilization fees (For first quarter of 2024, the interest amounted to nil and underutilization fees amounted to $ 22 thousand). During the three months ended March 31, 2025, the Company repaid interest amounting to $ 0.1 million (For three months ended March 31, 2024: nil ). Apart from the above-mentioned transactions, the Company had transactions with Allseas which are detailed in Note 6. ​ 20 Table of Contents TMC the metals company Inc. Notes to Interim Condensed Consolidated Financial Statements (in thousands of US Dollars, except share and per share amounts and unless otherwise stated) (Unaudited) 16 . Contingent Liabilities 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 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. We understand that Mr. Leonard is now deceased. As of the date of this filing, plaintiffs have not filed a motion to substitute his estate, and it is unclear whether they intend to continue the claims against his estate. 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. v. Sustainable Opportunities Acquisition Corp. n/k/a TMC The Metals Company Inc., Index No. 650449/2023 (N.Y. Sup. Ct.). The Company filed a motion to dismiss on March 31, 2023, after which the plaintiffs filed an amended complaint on June 5, 2023. The amended complaint alleges that the Company breached the representations and warranties in the plaintiffs’ private placement Subscription Agreements and breached the covenant of good faith and fair dealing. The Plaintiffs are seeking to recover compensable damages caused by the alleged wrongdoings. The Company denies any allegations of wrongdoing and filed a motion to dismiss the amended complaint on July 28, 2023. 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 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. Such losses or range of possible losses cannot be reliably estimated. ​ 21 Table of Contents TMC the metals company Inc. Notes to Interim Condensed Consolidated Financial Statements (in thousands of US Dollars, except share and per share amounts and unless otherwise stated) (Unaudited) 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. 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. 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 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 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 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. On February 6, 2025, the Court appointed a lead plaintiff. An amended complaint was filed on March 6, 2025. Pursuant to court-approved scheduling, the Company filed a motion to dismiss on April 10, 2025. The lead plaintiff is expected to file an opposition by May 15, 2025, and the Company is expecting 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. ​ 17. Fair Value Accounting The following tables set forth the Company’s assets and liabilities measured at fair value (Note 4): ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Fair Value at March 31, 2025 ​ Total Level 1 Level 2 Level 3 Assets: ​ ​ ​ ​ Cash ​ $ 2,346 ​ $ 2,346 ​ $ — ​ $ — Receivables and prepayments ​ 5,012 ​ — ​ 5,012 ​ — Exploration contracts ​ 42,951 ​ — ​ — ​ 42,951 Right of use asset ​ 3,337 ​ — ​ — ​ 3,337 Equipment ​ 713 ​ — ​ — ​ 713 Software ​ 1,958 ​ — ​ — ​ 1,958 Investment ​ 8,168 ​ — ​ — ​ 8,168 ​ ​ $ 64,485 ​ $ 2,346 ​ $ 5,012 ​ $ 57,127 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Liabilities: ​ ​ ​ ​ Accounts payable and accrued liabilities ​ $ 45,245 ​ $ — ​ $ 45,245 ​ $ — Short-term debt ​ 9,978 ​ — ​ 9,978 ​ — Deferred tax liability ​ 10,675 ​ — ​ 10,675 ​ — Royalty liability ​ 14,000 ​ — ​ — ​ 14,000 Warrants liability ​ 1,353 ​ — ​ — ​ 1,353 ​ ​ $ 81,251 ​ $ — ​ $ 65,898 ​ $ 15,353 ​ ​ 22 Table of Contents TMC the metals company Inc. Notes to Interim Condensed Consolidated Financial Statements (in thousands of US Dollars, except share and per share amounts and unless otherwise stated) (Unaudited) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Fair Value at December 31, 2024 ​ Total Level 1 Level 2 Level 3 Assets: ​ ​ ​ ​ Cash ​ $ 3,480 ​ $ 3,480 ​ $ — ​ $ — Receivables and prepayments ​ 1,851 ​ — ​ 1,851 ​ — Exploration contracts ​ 42,951 ​ — ​ — ​ 42,951 Right of use asset ​ 3,814 ​ — ​ — ​ 3,814 Equipment ​ 771 ​ — ​ — ​ 771 Software ​ 1,928 ​ — ​ — ​ 1,928 Investment ​ 8,203 ​ — ​ — ​ 8,203 ​ ​ $ 62,998 ​ $ 3,480 ​ $ 1,851 ​ $ 57,667 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Liabilities: ​ ​ ​ ​ Accounts payable and accrued liabilities ​ $ 42,754 ​ $ — ​ $ 42,754 ​ $ — Short-term debt ​ 11,775 ​ — ​ 11,775 ​ — Deferred tax liability ​ 10,675 ​ — ​ 10,675 ​ — Royalty liability ​ 14,000 ​ — ​ — ​ 14,000 Warrants liability ​ 912 ​ — ​ — ​ 912 ​ ​ $ 80,116 ​ $ — ​ $ 65,204 ​ $ 14,912 ​ ​ 18. 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. Details on the geographical segmentation of the Company’s long-lived assets based on where each legal entity is domiciled are as follows: ​ ​ ​ ​ ​ ​ ​ ​ ​ March 31, December 31, Equipment ​ 2025 ​ 2024 Nauru ​ $ 713 ​ $ 771 Tonga ​ — ​ — Total ​ $ 713 ​ $ 771 ​ ​ ​ ​ ​ ​ ​ ​ ​ March 31, December 31, Software ​ 2025 ​ 2024 Singapore ​ 1,958 ​ 1,928 Total ​ $ 1,958 ​ $ 1,928 ​ ​ 19. Subsequent Events On May 12, 2025, the Company entered into a securities purchase agreement with certain new and existing investors, including an existing strategic investor, for the sale of an aggregate of 12,333,333 common shares (the "Shares") and accompanying Class C warrants (the "Class C Warrants"), in a registered direct offering. The offering price was $ 3.00 per Share (gross proceeds of $ 37.0 million), with each Share including an accompanying Class C Warrant to purchase one common share. The Class C Warrants are exercisable immediately upon issuance at a price of $ 4.50 per share and expire three years from issuance. ​ ​ ​ 23 ​ Table of Contents