COBA 10-Q Quarter ended Sept. 30, 2025

Earnings (Loss) Per Share

The weighted-average common shares outstanding for both basic and diluted earnings per share for all periods presented was calculated, in accordance with the Financial Accounting Standards Board’s (the “FASB”) Accounting Standards Codification (“ASC”) 260, Earnings Per Share. To the extent that stock options, warrants and convertible preferred stock are anti-dilutive, they are excluded from the calculation of diluted earnings (loss) per share. As of the three and nine-month periods ended September 30, 2025 and 2024, the Company excluded the following shares from the calculation of diluted loss per share because such amounts were anti-dilutive:

Fair Value Measurements

The Company uses fair value measurements to record fair value adjustments to certain assets and liabilities, as necessary, and to determine fair value disclosures of financial instruments on a recurring basis.

Consistent with ASC Topic 820, Fair Value Measurements (“ASC 820”), assets and liabilities that are required to be recorded at fair value are done so at the price that would be received to sell an asset or the price that would be paid to transfer a liability in an orderly transaction between market participants at the measurement date. When measuring fair value, and consistent with the fair value hierarchy in ASC 820, the Company maximizes the use of observable inputs and minimizes the use of unobservable inputs consistent with the following fair value hierarchy:

For assets and liabilities measured at fair value when there is limited or no observable market data, management applies judgment to estimate fair value and considers factors such as current pricing policy, the economic and competitive environment, the characteristics of the asset or liability, and other factors. The amounts estimated by management cannot be determined with precision and may not be realized in an actual sale or immediate settlement of the asset or liability. Inherent limitations in any such fair value calculation technique, including changes in discount rates, estimates of future cash flows, and other underlying assumptions, could significantly affect the results of current or future value.

Use of Estimates

The preparation of condensed consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the condensed consolidated financial statements, and the reported amounts of revenue and expenses during the reporting periods. Significant estimates and assumptions reflected in these condensed consolidated financial statements include but are not limited to the applicability of accrued expenses and volatility used in the determination of stock-based expenses. Estimates are periodically reviewed in light of changes in circumstances, facts, and experience. There have been no changes in estimates during the periods presented. Actual results could differ from the Company’s estimates and those differences may be material.

Cash

Cash amounts consist of cash on hand, bank deposits, and money market accounts. Cash equivalents consist of all liquid debt instruments with original maturities of three months or less. As of September 30, 2025, and December 31, 2024, the Company’s cash balances were $ 189,157 and $ 331,309 , respectively, and the Company’s cash equivalents were $- 0 - and $- 0 -, respectively.

Subscriptions Receivable and Stock Compensation

The Company typically reflects subscriptions receivable in stockholders’ equity, unless there is substantial evidence of the intent and ability of the subscriber to pay the amounts in a reasonable amount of time, in which case the subscriptions receivable are instead reflected as an asset on the balance sheet.

The subscriptions receivable of $ 73,431 was reflected as an asset on the balance sheet as of December 31, 2024, as the amounts were received from the subscribers within days after year-end, which was considered substantial evidence of the intent and ability of the subscribers to pay the amounts in a reasonable amount of time.

The Company reflects stock-based compensation at the intrinsic value of the compensation ratably across the periods in which the compensation is earned. When stock is issued for services, the intrinsic value of the stock issued is amortized ratably over the period in which the compensation is earned. In the initial period of amortization, the amortized portion is reflected in preferred or common stock, as applicable, for both shares and the full par value with any residual reflected in additional paid-in capital. The amortization for each subsequent period is reflected entirely in additional paid-in capital.

Value Added Tax (“VAT Tax”)

The Company’s subsidiary historically has paid significant amounts of VAT Tax to the Chilean government on certain operating purchases. The tax paid can be offset against future VAT Tax due. The Company has not recorded any VAT tax receivables as of September 30, 2025, and December 31, 2024, because the Company’s ability to fund future expenditures necessary to recover VAT taxes paid in, is currently indeterminable.

Property and Equipment

Property, plant, and equipment are stated at cost, less accumulated depreciation. Acquired property, plant and equipment are recognized at their estimated fair value. Capitalized costs may include computers, vehicles, furniture and fixtures, machinery, and equipment, and are depreciated using the straight-line method or unit-of-production method at rates sufficient to depreciate such costs over the shorter of estimated productive lives or the useful life of the individual assets. Useful lives range from 3 to 10 years. Capitalized costs may also include buildings or improvements to land, which if applicable, have useful lives ranging from 20 to 40 years.

Gains and losses are reflected in income or expense upon sale or retirement of assets. Expenditures that extend the useful lives of property, plant and equipment or increase productivity are capitalized. Ordinary repairs and maintenance are expensed as incurred through operating expense. We periodically evaluate whether events or circumstances indicate that the net book value of our property, plant and equipment may not be recoverable.

Costs are capitalized when it has been determined an ore body can be economically developed. The development stage begins at new projects when our management and/or board of directors make the decision to bring a mine into commercial production and ends when the production state, or extraction of reserves, begins. The production stage of a mine commences when salable materials, beyond a de minimis amount, are produced.

Exploration costs include those relating to activities carried out (a) in search of previously unidentified mineral deposits or (b) at undeveloped concessions. Pre-development activities involve costs incurred in the exploration stage that may ultimately benefit production and are expensed due to a lack of evidence of economic development, which is necessary to demonstrate future recoverability of these expenses. Costs for exploration, evaluation, and pre-development, including drilling costs related to those activities (discussed further below), and repairs and maintenance on capitalized property and equipment are charged to operations as incurred.

Drilling, development, and related costs are either classified as exploration, pre-development or secondary development as defined above, and charged to operations as incurred, or capitalized based on the following criteria:

If all of these criteria are met, drilling, development and related costs are capitalized. Drilling and development costs not meeting all of these criteria are expensed as incurred. The following factors are considered in determining whether or not the criteria listed above have been met, and whether capitalization of drilling and development costs is appropriate:

Drilling and related costs at our properties as of and for the nine-months ended September 30, 2025, and September 30, 2024, respectively, and the three-months ended September 30, 2025, and September 30, 2024, respectively, did not meet our criteria for capitalization.

When assets are retired or sold, the costs and related allowances for depreciation and amortization are eliminated from the accounts and any resulting gain or loss is reflected in the current period net income (loss).

Impairment of Long-lived Assets

Long-lived assets consist of property and equipment. Long-lived assets to be held and used are tested for recoverability whenever events or changes in business circumstances indicate that the carrying amount of the assets may not be fully recoverable. Factors that the Company considers in deciding when to perform an impairment review include significant underperformance of the business in relation to expectations, significant negative industry or economic trends, and significant changes or planned changes in the use of the assets. If an impairment review is performed to evaluate a long-lived asset for recoverability, the Company compares forecasts of undiscounted cash flows expected to result from the use and eventual disposition of the long-lived asset to its carrying value. An impairment loss would be recognized when estimated undiscounted future cash flows expected to result from the use and eventual disposition of an asset are less than its carrying amount. The impairment loss would be based on the excess of the carrying value of the impaired asset over its fair value less cost to sell or dispose, determined based on discounted cash flows.

During the three-months and nine-months ended September 30, 2025 and 2024, we recorded $ 1,881,082 and $ 0 , respectively, impairment loss in those periods. The decision to write-down the mining concessions acquired on September 12, 2025 was driven by the lack of reliability of and availability of independent valuations for these unique assets, as necessary to substantiate their value on these financial statements. Baltum presently owns 6,377 hectares of exploitation-level mining concessions in the San Juan mining district, which were recorded as fully impaired and written down to $-0- value from approximately $10.7 million on the Company’s facilities located in the San Juan mining district of Chile. Under a funding level that allows the Company to focus on exploration, Baltum will continue its exploration activities under these mining concessions toward proving the existence of cobalt and/or copper. Depending on the outcome of the exploration activities, the Company would then consider seeking a preliminary economic assessment, preliminary feasibility study, or definitive feasibility study to validate the expected profitability of constructing a plant to extract the target minerals and process them into saleable products.

Environmental Obligations

We provide for environmental-related obligations when they are probable and amounts can be reasonably estimated. Where the available information is sufficient to estimate the amount of liability, that estimate has been used.

Included in our environmental liabilities are costs for the operation, maintenance and monitoring of site remediation plans (“OM&M”). If applicable, such reserves are based on our best estimates for these OM&M plans. Over time we could incur OM&M costs in excess of these reserves. However, we are unable to reasonably estimate an amount in excess of any recorded reserves because we cannot reasonably estimate the period for which such OM&M plans will need to be in place or the future annual cost of such remediation, as conditions at environmental sites change over time. If applicable, such additional OM&M costs could be significant in total but would be incurred over an extended period of years.

Environmental remediation charges represent the costs for continuing charges associated with environmental remediation at operating sites from previous years and from products that are no longer manufactured and are currently not applicable.

Leases

The Company determines if an arrangement is a lease at the inception of the contract. If applicable, our operating leases are included in Operating lease right-of-use (“ROU”) assets, operating lease liabilities – current, and Operating lease liabilities – long term in the condensed consolidated balance sheets. The operating lease ROU assets and operating lease liabilities are recognized based on the present value of future minimum lease payments over the lease term at commencement date. As most leases do not provide an implicit interest rate, we utilize an estimated incremental borrowing rate based on the information available at commencement date in determining the present value of future payments. In determining the discount rate used in the present value calculation, the Company has elected to apply the portfolio approach for leases provided the leases commenced at or around the same time. This election allows the Company to account for leases at a portfolio level provided that the resulting accounting at this level would not differ materially from the accounting at the individual lease level. Lease expense for minimum lease payments is recognized on a straight-line basis over the lease term.

If leases are applicable, the Company has elected not to separate lease and non-lease components and accounts for each separate lease component and non-lease component associated with that lease component as a single lease component. Operating lease ROU assets include all contractual lease payments and initial direct costs incurred less any lease incentives. Facility leases generally only contain lease expense and non-component items such as taxes and pass-through charges. Additionally, we have elected not to apply the recognition requirements of ASC 842 to leases which have a lease term of less than one year at the commencement date.

Mining Concessions

Mining concessions are recorded at cost based on the payments required under the contracts. Amortization begins when placed in service after the mining concession is exercised. Mining concessions are amortized over their useful life based on the pattern over which the mining concessions are consumed or otherwise used up. Determination of expected useful lives for amortization calculations is made on a property-by-property or asset-by-asset basis at least annually. At the time an ore body can be economically developed, the basis of the mining concession will be amortized on a units-of-production basis. Pursuant to our policy on the impairment of long-lived assets, if it is determined that a mining concession cannot be economically developed or its innate value has not been independently substantiated, the basis of the mining concession is reduced to its fair value and an impairment loss is recorded to expense in the period in which it is determined to be impaired.

Finite-lived intangible assets are tested for impairment when events or changes in circumstances indicate that the carrying value of the asset may not be recoverable. Intangible assets that are not subject to amortization are tested for impairment annually and more frequently if events or changes in circumstances indicate that is more likely than not, meaning more than 50%, that the asset is impaired.

The value of the exploitation mining concessions owned by Baltum has yet to be independently substantiated by a valuation or any level of feasibility study. As of September 30, 2025, and December 31, 2024, these mining concessions had a value of $- 0 - and $- 0 -, respectively on the Company’s condensed consolidated balance sheet.

Restructuring and Other Charges

We continually perform strategic reviews and assess the returns on our businesses. In the event that this results in a plan to restructure the operations of our business, we record an accrual for severance and other exit costs under the provisions of the relevant accounting guidance.

Research and Development

Research and development costs are expensed as incurred.

Foreign Currency

The reporting currency of the Company is the U.S. dollar. The functional currency of Baltum, the Company’s wholly-owned subsidiary, is the Chilean Peso. The assets and liabilities of Baltum are translated into U.S. dollars based on exchange rates at the end of each reporting period. Expenses are translated at average exchange rates during the reporting period. Gains and losses arising from the translation of assets and liabilities are included as a component of accumulated other comprehensive income or loss within the Company’s condensed consolidated balance sheet. Gains and losses resulting from foreign currency transactions are reflected within the Company’s condensed consolidated statements of operations. Transactions denominated in foreign currency other than our functional currency of the foreign operation are recorded upon initial recognition at the exchange rate at the date of the transaction. After initial recognition, monetary assets and liabilities denominated in foreign currency are remeasured at each reporting date into the functional currency at the exchange rate at that date. The Company has not utilized foreign currency hedging strategies to mitigate the effect of its foreign currency exposure. We recorded transaction and remeasurement gains of $- 0 .0- million and $- 0 .0- million for the three-months ended September 30, 2024 and 2025, respectively, and $- 0 .0- million and $- 0 .0- million for the nine-months ended September 30, 2024 and 2025, respectively.

Income Taxes

The Company accounts for income taxes using the asset and liability method, which requires the recognition of deferred tax assets and liabilities for the expected future tax consequences of events that have been recognized in the consolidated financial statements or in the Company’s tax returns. Deferred taxes are determined based on the differences between the consolidated financial statements and tax basis of assets and liabilities using enacted tax rates in effect in the years in which the differences are expected to reverse. Changes in deferred tax assets and liabilities are recorded in the provision for income taxes. The Company assesses the likelihood that its deferred tax assets will be recovered from future taxable income and, to the extent it believes, based upon the weight of available evidence, that is more likely than not that all or a portion of the deferred tax assets will not be realized, a valuation allowance is established through a charge to income tax expense. The potential for recovery of deferred tax assets is evaluated by estimating the future taxable profits expected and considering prudent and feasible tax planning strategies. The Company’s wholly owned subsidiary is subject to foreign corporate tax in foreign taxing jurisdictions. We do not provide income taxes on the equity in undistributed earnings of consolidated foreign subsidiaries as it is our intention that such earnings will remain invested in those companies.

The Company accounts for income taxes in accordance with ASC 740, “Accounting for Income Taxes” (“ASC 740”). Under ASC 740, income tax expense includes federal and state taxes currently payable and deferred taxes arising from temporary differences between income for financial reporting and income tax purposes.

In accordance with ASC 740, the Company has evaluated its tax positions. A tax position is recognized as a benefit only if it is “more likely than not” that the tax position would be sustained in a tax examination, with a tax examination being presumed to occur. The amount recognized is the largest amount of tax benefit that has a likelihood of being realized on examination of more than 50 percent. For tax positions not meeting the “more likely than not” test, no tax benefit is recorded. Under the “more likely than not” threshold guidelines, the Company believes no significant uncertain tax positions exist, either individually or in the aggregate, that would give rise to the non-recognition of an existing tax benefit. The Company’s policy is to account for interest expense and penalties related to unrecognized tax benefits as a component of income tax expense. The Company is currently not under examination with any federal, state, or foreign taxing authorities. In addition, the Company had no material unrecognized tax benefits or accrued interest and penalties as of and for the nine-months ended September 30, 2025.

Concentration of Credit Risk and of Significant Vendors

The Company maintains cash balances at financial institutions in the U.S. and Chile. The Company holds all cash balances at accredited financial institutions, in amounts that exceed federally insured limits in the United States of America. The Company does not believe that it is subject to unusual credit risk beyond the normal credit risk associated with commercial banking relationships.

Segment Reporting

The Company has not yet begun generating revenues from its planned principal operations and operates as a single reportable segment for its cobalt-copper / copper-cobalt projects in Chile. The chief operating decision maker is the Company’s chief executive officer, who assesses the performance based on total expenses, cash flows and progress made in the Company’s ongoing development efforts. All of the Company’s long-lived assets are located in Chile.

Recently Issued and Adopted Accounting Pronouncements

The Company’s management has evaluated all the recently issued accounting pronouncements through the filing date of these financial statements and does not believe that any of these pronouncements will have a material impact on the Company’s current financial position and results of operations.