CBLT Inc. — Audit Report / Information 2025

Sep 26, 2025

CBLT INC.

Consolidated Financial Statements

May 31, 2025 and 2024

(Expressed in Canadian Dollars)

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CBLT INC.

TABLE OF CONTENTS

PAGE

Management's Responsibility for Financial Reporting 1
Independent Auditors' Report 2-4
Consolidated Financial Statements
Consolidated Statements of Financial Position 5
Consolidated Statements of Net Income (Loss) and Comprehensive Income (Loss) 6
Consolidated Statements of Changes in Shareholders' Deficit 7
Consolidated Statements of Cash Flows 8
Notes to the Consolidated Financial Statements 9 - 30

1

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JONES & O'Connell LLP
CHARTERED PROFESSIONAL ACCOUNTANTS
43 Church Street, Suite 500 + P.O. Box 1237 + St. Catharines, ON + L2R 7A7
phone 905.688.4842 fax 905.688.1746
www.jonesoconnell.ca

Independent Auditor's Report

To the Shareholders of CBLT Inc.

Opinion

We have audited the consolidated financial statements of CBLT Inc. ("the Group"), which comprise the consolidated statements of financial position as at May 31, 2025 and May 31, 2024 and the consolidated statements of net income (loss) and comprehensive income (loss), consolidated statements of changes in shareholders' deficit and consolidated statements of cash flows for the years then ended, and notes to the consolidated financial statements, including material accounting policy information.

In our opinion, the accompanying consolidated financial statements present fairly, in all material respects, the consolidated financial position of the Group as at May 31, 2025 and May 31, 2024 and its consolidated financial performance and its consolidated cash flows for the years then ended in accordance with IFRS Accounting Standards as issued by the International Accounting Standards Board (IASB).

Basis for Opinion

We conducted our audits in accordance with Canadian generally accepted auditing standards. Our responsibilities under those standards are further described in the Auditor's Responsibilities for the Audit of the Consolidated Financial Statements section of our report. We are independent of the Group in accordance with the ethical requirements that are relevant to our audits of the consolidated financial statements in Canada, and we have fulfilled our other ethical responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.

Emphasis of Matter - Material Uncertainty Related to Going Concern

We draw attention to Note 1 in the consolidated financial statements, which indicates that the Group has a working capital deficiency of $303,655 (2024 - $59,301) and has an accumulated deficit of $5,214,077 (2024 - $4,969,723). As stated in Note 1, these conditions, along with other matters as set forth in Note 1, indicate that a material uncertainty exists that may cast significant doubt on the Company's ability to continue as a going concern. Our opinion is not modified in respect of this matter.

Key Audit Matters

Key audit matters are those matters that, in our professional judgment, were of most significance in our audit of the consolidated financial statements of the Group for the years ended May 31, 2025 and May 31, 2024. These matters were addressed in the context of our audit of the consolidated financial statements as a whole, and in forming our opinion thereon, and we do not provide a separate opinion on these matters. We have identified no other key audit matters other than the matter described in the Emphasis of Matter - Material Uncertainty Related to Going Concern section of our report.

Information Other than the Consolidated Financial Statements and Auditor's Report Thereon

Management is responsible for other information. Other information comprises the information included in Management's Discussion and Analysis for the years ended May 31, 2025 and May 31, 2024, filed with the relevant Canadian Securities Commissions. Our opinion on the consolidated financial statements does not cover the other information and we do not and will not express any form of assurance conclusion thereon. In connection with our audits of the consolidated financial statements, our responsibility is to read the other information identified above and, in doing so, consider whether the other information is materially inconsistent with the consolidated financial statements or our knowledge obtained in the audits or otherwise appears to be materially misstated. If, based on the work we have performed on this other information, we conclude that there is a material misstatement of this other information, we are required to report that fact in the auditors' report. We have nothing to report in this regard.

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Independent Auditor's Report

To the Shareholders of CBLT Inc. (Continued)

Responsibilities of Management and Those Charged with Governance for the Consolidated Financial Statements

Management is responsible for the preparation and fair presentation of the consolidated financial statements in accordance with IFRS Accounting Standards as issued by the IASB and for such internal control as management determines is necessary to enable the preparation of consolidated financial statements that are free from material misstatement, whether due to fraud or error.

In preparing the consolidated financial statements, management is responsible for assessing the Group's ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless management either intends to liquidate the Group or to cease operations, or has no realistic alternative but to do so.

Those charged with governance are responsible for overseeing the Group's financial reporting process.

Auditor's Responsibilities for the Audit of the Consolidated Financial Statements

Our objectives are to obtain reasonable assurance about whether the consolidated financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor's report that includes our opinion. Reasonable assurance is a high level of assurance, but it is not a guarantee that an audit conducted in accordance with Canadian generally accepted auditing standards will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these consolidated financial statements.

As a part of an audit in accordance with Canadian generally accepted auditing standards, we exercise professional judgement and maintain professional skepticism throughout the audit. We also:

• Identify and assess the risks of material misstatement of the consolidated financial statements, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as a fraud may involve collusion, forgery, intentional omissions, misrepresentations or the override of internal control.
• Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Group's internal control.
• Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by management.
• Conclude on the appropriateness of management's use of the going concern basis of accounting and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the Group's ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our auditor's report to the related disclosures in the consolidated financial statements or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditor's report. However, future events or conditions may cause the Group to cease to continue as a going concern.
• Evaluate the overall presentation, structure and content of the consolidated financial statements, including the disclosures, and whether the consolidated financial statements represent the underlying transactions and events in a manner that achieves fair presentation.
• Plan and perform the group audit to obtain sufficient appropriate audit evidence regarding the financial information of the entities or business units within the Group as a basis for forming an opinion on the group consolidated financial statements. We are responsible for the direction, supervision and review of the audit work performed for purposes of the group audit. We remain solely responsible for our audit opinion.

JONES & O'Connell LLP
CHARTERED PROFESSIONAL ACCOUNTANTS

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Independent Auditor's Report

To the Shareholders of CBLT Inc. (Continued)

Auditor's Responsibilities for the Audit of the Consolidated Financial Statements (Continued)

We communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit and significant audit findings, including any significant deficiencies in internal control that we identify during our audit.

We also provide those charged with governance with a statement that we have complied with relevant ethical requirements regarding independence, and to communicate with them all relationships and other matters that may reasonably be thought to bear on our independence, and where applicable, related safeguards.

From the matters communicated with those charged with governance, we determine those matters that were of most significance in the audit of the consolidated financial statements of the current period and are therefore the key audit matters. We describe these matters in our auditor's report unless law or regulation precludes public disclosure about the matter, or when, in extremely rare circumstances, we determine that a matter should not be communicated in our report because the adverse consequences of doing so would reasonably be expected to outweigh the public interest benefits of such communication.

The engagement partner on the audit resulting in this independent auditor's report is Wayne O'Connell.

Jones & O'Connell LLP

Jones & O'Connell LLP
Chartered Professional Accountants
Licensed Public Accountants
St. Catharines, Ontario
September 25, 2025

JO Jones & O'Connell LLP
CHARTERED PROFESSIONAL ACCOUNTANTS

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CBLT INC.
Consolidated Statements of Financial Position
May 31, 2025 and 2024
(Expressed in Canadian dollars)

	2025	2024
ASSETS
Current
Cash and cash equivalents	$ 5,757	$ 173,480
Investments (Note 4)	24,300	28,667
Sundry receivables	19,618	7,071
Prepaid expenses	13,610	18,335
	$ 63,285	$ 227,553
LIABILITIES
Current
Accounts payable and accrued liabilities (Note 6)	$ 196,305	$ 120,545
Liability for flow-through shares (Note 14)	2,635	10,309
Provision for indemnification of flow-through subscribers (Note 10)	168,000	156,000
	366,940	286,854
SHAREHOLDERS' DEFICIT
Share capital (Note 7)	4,380,364	4,380,364
Contributed surplus (Notes 7, 8, and 9)	530,058	530,058
Deficit	(5,214,077)	(4,969,723)
	(303,655)	(59,301)
	$ 63,285	$ 227,553

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

Nature of business and going concern (Note 1)
Commitments and contingencies (Note 14)
Subsequent events (Note 16)

APPROVED BY THE BOARD
(s) Peter Clausi Director
(s) Brian Crawford Director

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6

CBLT INC.

Consolidated Statements of Net Income (Loss) and Comprehensive Income (Loss)

(Expressed in Canadian Dollars)

	May 31, 2025	May 31, 2024
Expenses
	$
General and administrative (Note 6)	151,955	$ 175,223
Professional fees	21,083	25,385
Filing and transfer agent fees	20,540	17,151
Share-based compensation (Notes 6 and 8)	-	50,019
General exploration expenditures (Note 3)	42,083	46,773
	(235,661)	(314,551)
Other income (expense)
Government grant (Note 5)	-	20,000
Gain on sale of mineral properties (Note 3)	-	180,000
Settlement of flow-through premium liability	7,674	3,074
(Loss) on financial instruments held at fair value through profit and loss unrealized (Note 4)	(4,367)	(64,975)
Provision for indemnification of flow-through subscribers (Note 10)	(12,000)	215,231
	(8,693)	353,330
Net (loss) income and comprehensive (loss) income	$ (244,354)	$ 38,779
Income (loss) per share-basic and diluted	$ (0.00)	$ (0.00)
Weighted average number of shares outstanding – basic	77,177,073	76,556,854
– diluted	77,177,073	76,556,854

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

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CBLT INC.
Consolidated Statements of Changes in Shareholders' Deficit
(Expressed in Canadian Dollars)

	Common Shares	Contributed Surplus	Deficit	Total
Balance, May 31, 2023	$ 4,355,364	$ 504,461	$ (5,044,541)	$ (184,716)
Shares issued for cash	38,383	11,617	-	50,000
Flow-through premium	(13,383)	-	-	(13,383)
Share-based compensation	-	50,019	-	50,019
Options and warrants expired	-	(36,039)	36,039	-
Net income and comprehensive income	-	-	38,779	38,779
Balance, May 31, 2024	$ 4,380,364	$ 530,058	$ (4,969,723)	$ (59,301)
Net loss and comprehensive loss	-	-	(244,354)	(244,354)
Balance, May 31, 2025	$ 4,380,364	$ 530,058	$ (5,214,077)	$ (303,655)

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

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CBLT INC.
Consolidated Statements of Cash Flows
May 31, 2025 and 2024
(Expressed in Canadian Dollars)

	May 31, 2025	May 31, 2024
Cash provided by (used in)
OPERATING ACTIVITIES
Net income (loss) and comprehensive income (loss) for the year	$ (244,354)	$ 38,779
Settlement of flow-through premium liability	(7,674)	(3,074)
Unrealized loss (gain) on investments	4,367	64,975
Gain on sale of mineral property	-	(180,000)
Accretion	-	1,701
Provision for indemnification of flow-through subscribers	12,000	(215,231)
Share-based compensation	-	50,019
Government grant	-	(20,000)
Changes in non-cash working capital items
Sundry receivables	(12,547)	(220)
Prepaid expenses	4,725	2,318
Accounts payable and accrued liabilities	75,760	(55,877)
	(167,723)	(316,610)
INVESTING ACTIVITIES
Proceeds on sale of mineral properties-net	-	180,000
	-	180,000
FINANCING ACTIVITIES
Repayment of CEBA loan	-	(40,000)
Proceeds on issuance of flow through units	-	50,000
	-	10,000
Change in cash	(167,723)	(126,610)
Cash and cash equivalents, beginning of year	173,480	300,090
Cash and cash equivalents, end of year	$ 5,757	$ 173,480

Supplemental Cash Flow Information (Note 15)

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

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CBLT INC.

Notes to the Consolidated Financial Statements

May 31, 2025 and 2024

(Expressed in Canadian dollars)

1. NATURE OF BUSINESS AND GOING CONCERN

CBLT Inc. (the "Company"), was incorporated under the Canada Business Corporations Act on April 28, 2008, and was continued under the Ontario Business Corporations Act on April 24, 2017.

The Company's shares are listed on the TSX Venture Exchange. The head office, principal address and records office of the Company are located at Suite 200, 3310 South Service Road Burlington, Ontario, Canada L7N 3M6.

The Company is primarily engaged in the business of acquiring, exploring and dealing in mineral properties in Canada. There has been no determination whether properties held contain economically recoverable mineral resources.

The Company needs equity capital and financing for its working capital and for the costs of exploration and development of its properties. As at May 31, 2025, the Company has a working capital deficiency of $303,655 (2024 - $59,301) and accumulated deficit of $5,214,077 (2024 - $4,969,723). Although the Company has been successful in raising funds to date, there can be no assurance that adequate funding will be available in the future, or available under terms favourable to the Company. These material uncertainties cast significant doubt upon the Company's ability to continue as a going concern. These consolidated financial statements have been prepared on a going concern basis that assumes the Company will be able to continue to realize its assets and discharge its liabilities and commitments in the normal course of business. In assessing whether the going concern assumption is appropriate, management takes into account all available information about the future, which is at least, but is not limited to, twelve months from the end of the reporting period. These consolidated financial statements do not reflect adjustments or classifications which might be necessary if the Company was not able to continue as a going concern. These adjustments could be material.

2. MATERIAL ACCOUNTING POLICIES

Statement of compliance with International Financial Reporting Standards

These consolidated financial statements of the Company have been prepared in accordance with International Financial Reporting Standards ("IFRS") as issued by the International Accounting Standards Board ("IASB") and interpretations of the IFRS Interpretations Committee ("IFRIC").

The accounting policies set out below have been applied consistently to all periods presented in these consolidated financial statements.

The policies applied in these consolidated financial statements are based on IFRS issued and effective as of May 31, 2025. The Board of Directors approved the consolidated financial statements on September 25, 2025.

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CBLT INC.

Notes to the Consolidated Financial Statements

May 31, 2025 and 2024

(Expressed in Canadian dollars)

2. MATERIAL ACCOUNTING POLICIES – continued

Basis of preparation

The consolidated financial statements of the Company include the accounts of its wholly owned subsidiary AgAuCu Canada Inc. and have been prepared on a historical cost basis. In addition, these consolidated financial statements have been prepared using the accrual basis of accounting except for cash flow information.

Functional and presentation currency

The presentation currency of the Company and its subsidiary and the functional currency of the Company and its subsidiary is the Canadian dollar.

Exploration and evaluation assets

Costs incurred with respect to exploration and evaluation (“E&E”) of the Company’s mineral properties, including acquisition costs, are expensed as incurred until the technical feasibility and commercial viability of extracting the mineral resource is determined.

Once the technical feasibility and commercial viability of extracting the mineral resource has been determined, the property is considered to be a mine under development and is classified as “mines under construction.

Revenue Recognition

Interest income from financial instruments (mainly cash and equivalents), is recognized using the effective interest method. Dividend income is recognized when the right to receive payment is established.

The Company has no ongoing revenue other than nominal interest income on cash balances, however, from time to time the Company sells or options Exploration and Evaluation assets (E&E assets) for cash and or shares of other exploration companies (or a combination of both). Any shares received are valued when received at fair market value. The value of the cash and or shares received are treated as income and shown as gain or loss on disposition of E&E properties as the Company’s E&E properties are being expensed.

Cash and cash equivalents

Cash and cash equivalents comprise cash at banks and on hand, and short-term deposits with an original maturity of three months or less, which are readily convertible into a known amount of cash.

Income taxes

Income taxes are accounted for using the asset and liability method. Under this approach, deferred income tax assets and liabilities are determined based on differences between the carrying amounts and the tax basis of assets and liabilities and are measured using the substantively enacted tax rates and laws that are expected to apply when the amounts are realized. Deferred income tax assets are recognized to the extent that it is probable there will be sufficient taxable profits against which to utilize the benefits in the future.

The tax expense includes current and deferred tax. This expense is recognized in net loss, except for income tax related to the components of other comprehensive income or of equity.

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CBLT INC.
Notes to the Consolidated Financial Statements
May 31, 2025 and 2024
(Expressed in Canadian dollars)

1. MATERIAL ACCOUNTING POLICIES – continued

Income taxes – continued

In these specific cases, the tax expense is recognized in other comprehensive income or equity, respective Income tax receivables and payables are obligations or claims for the

current and prior periods to be paid to (or recovered from) taxation authorities that are still outstanding at the end of the reporting period. Current tax is computed on the basis of tax profit, which differs from accounting profit, using tax rates and laws which are substantially enacted at the end of the reporting period.

Valuation of equity units issued in private placements

The Company has adopted a residual value method with respect to the measurement of shares and warrants issued as private placement units. The residual value method first allocates value to common shares issued in the private placements at their fair value as determined by the closing quoted bid price on the announcement date. The balance, if any, is allocated to the warrants. Any fair value attributed to the warrants is recorded as warrants in contributed surplus. Share issue costs are netted against share proceeds.

Flow-through shares

The Company will, from time to time, issue flow-through common shares to finance a significant portion of its exploration program. Pursuant to the terms of the flow-through share agreements, these shares transfer the tax deductibility of qualifying resource expenditures to investors. On issuance, the Company bifurcates the flow-through share into i) a flow-through share premium, equal to the estimated premium if any received from the investor, which is recognized as a liability, and ii) share capital. Upon expenses being incurred, the Company derecognizes the liability and recognizes a deferred tax liability for the amount of tax reduction renounced to the shareholders. The premium is recognized as a deferred income tax recovery and the resulting deferred tax is recognized as a tax provision.

Proceeds received from the issuance of flow-through shares are restricted to be used only for Canadian resource property exploration expenditures within a two-year period.

The Company may also be subject to a Part XII.6 tax on flow-through proceeds renounced under the look-back Rule, in accordance with Government of Canada flow-through regulations. When applicable, this tax is accrued as a financial expense until paid.

Restoration, rehabilitation and environmental obligations

A legal or constructive obligation to incur restoration, rehabilitation and environmental costs may arise when environmental disturbance is caused by the exploration, development or ongoing production of a mineral property interest. Such costs arising from the decommissioning of a plant and other site preparation work, discounted to their net present value, are provided for and capitalized to the carrying amount of the asset, as soon as the obligation to incur such costs arises. Discount rates using a pre-tax rate that reflects the time value of money are used to calculate the net present value. The related liability is adjusted for each period for the unwinding of the discount rate and for changes to the current market based discount rate, amount or timing of the underlying cash flows needed to settle the obligation.

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CBLT INC.

Notes to the Consolidated Financial Statements

May 31, 2025 and 2024

(Expressed in Canadian dollars)

2. MATERIAL ACCOUNTING POLICIES – continued

Impairment of non-financial assets

At the end of each reporting period, the Company reviews the carrying amounts of its tangible and intangible assets to determine whether there is an indication that those assets have suffered an impairment loss. If any such indication exists, the recoverable amount of the asset is estimated in order to determine the extent of the impairment loss (if any). Where it is not possible to estimate the recoverable amount of an individual asset, the Company estimates the recoverable amount of the cash generating unit to which the assets belong.

Recoverable amount is the higher of fair value less costs to sell and value in use. In assessing value in use, the estimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects current market assessments of the time value of money and the risks specific to the asset.

If the recoverable amount of an asset (or cash-generating unit) is estimated to be less than its carrying amount, the carrying amount of the asset (or cash-generating unit) is reduced to its recoverable amount. An impairment loss is recognized immediately in net loss.

Where an impairment loss subsequently reverses, the carrying amount of the asset (or cash-generating unit) is increased to the revised estimate of its recoverable amount, so that the increased carrying amount does not exceed the carrying amount that would have been determined had no impairment loss been recognized for the asset (or cash-generating unit) in prior years.

Provisions

A provision is recognized when the Company has a present legal or constructive obligation as a result of a past event, it is probable that an outflow of economic benefits will be required to settle the obligation, and the amount of the obligation can be reliably estimated. If the effect is material, provisions are determined by discounting the expected future cash flows at a pre-tax rate that reflects current market assessments of the time value of money and, where appropriate, the risks specific to the liability. See Note 11.

Foreign currencies

Transactions in currencies other than the functional currency are recorded at the exchange rate prevailing at the date of the transaction. Monetary assets and liabilities denominated in foreign currencies are translated at period-end rates. Non-monetary items that are measured in terms of historical cost in a foreign currency are not retranslated. Any resulting differences are included in net loss.

Financial instruments

Financial instruments are measured on initial recognition at fair value, plus, in the case of financial instruments other than those classified as fair value through profit or loss ("FVTPL"), directly attributable transaction costs. Financial instruments are recognized when the Company becomes party to the contracts that give rise to them and are classified as amortized cost, fair value through profit or loss or fair value through other comprehensive income, as appropriate.

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CBLT INC.
Notes to the Consolidated Financial Statements
May 31, 2025 and 2024
(Expressed in Canadian dollars)

2. MATERIAL ACCOUNTING POLICIES – continued

Financial instruments – continued

The Company has made the following classifications:

Cash	FVTPL
Investments	FVTPL
Sundry receivables	Amortized cost
Accounts payable	Amortized cost

Financial assets at FVTPL

Financial assets at FVTPL include cash along with financial assets held for trading and financial assets not designated upon initial recognition as amortized cost or fair value through other comprehensive income ("FVOCI"). A financial asset is classified in this category principally for the purpose of selling in the short term, or if so designated by management. Transaction costs are expensed as incurred. On initial recognition, a financial asset that otherwise meets the requirements to be measured at amortized cost or FVOCI may be irrevocably designated as FVTPL if doing so eliminates or significantly reduces an accounting mismatch that would otherwise arise. Financial assets measured at FVTPL are measured at fair value with changes in fair value recognized in the statements of net loss and comprehensive loss. Investments in shares and warrants are classified as FVTPL.

Financial assets at FVOCI

On initial recognition of an equity investment that is not held for trading, an irrevocable election is available to measure the investment at fair value upon initial recognition plus directly attributable transaction costs and at each period end, changes in fair value are recognized in other comprehensive income ("OCI") with no reclassification to the statements of operations. The election is available on an investment-by-investment basis.

Financial assets at amortized cost

A financial asset is measured at amortized cost if it is held within a business model whose objective is to hold assets to collect contractual cash flows and its contractual terms give rise on specified dates to cash flows that are solely payments of principal and interest on the principal amount outstanding and is not designated as FVTPL. Financial assets classified as amortized cost are measured subsequent to initial recognition at amortized cost using the effective interest method.

Financial liabilities

Financial liabilities are classified as measured at amortized cost or FVTPL. A financial liability is classified as at FVTPL if it is classified as held-for-trading, it is a derivative or it is designated as such on initial recognition. Financial liabilities at FVTPL are measured at fair value and net gains and losses, including any interest expense, are recognized in profit or loss. Other financial liabilities are subsequently measured at amortized cost using the effective interest method. Gains and losses are recognized in net loss when the liabilities are derecognized as well as through the amortization process. Borrowing liabilities are classified

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CBLT INC.

Notes to the Consolidated Financial Statements

May 31, 2025 and 2024

(Expressed in Canadian dollars)

2. MATERIAL ACCOUNTING POLICIES – continued

Financial instruments – continued

as current liabilities unless the Company has an unconditional right to defer settlement of the liability for at least 12 months after the statement of financial position date. Accounts payable and accrued liabilities are classified as and measured at amortized cost. Dividends payable are recognized at fair value through profit and loss.

De-recognition of financial assets and liabilities

A financial asset is derecognised when either the rights to receive cash flows from the asset have expired or the Company has transferred its rights to receive cash flows from the asset or has assumed an obligation to pay the received cash flows in full without material delay to a third party. If neither the rights to receive cash flows from the asset have expired nor the Company has transferred its rights to receive cash flows from the asset, the Company will assess whether it has relinquished control of the asset or not. If the Company does not control the asset then derecognition is appropriate. A financial liability is derecognised when the associated obligation is discharged or canceled or expires. When an existing financial liability is replaced by another from the same lender on substantially different terms, or the terms of an existing liability are substantially modified, such an exchange or modification is treated as the derecognition of the original liability and the recognition of a new liability. The difference in the respective carrying amounts is recognized in net loss.

Impairment of financial assets:

A loss allowance for expected credit losses is recognized in net loss for financial assets measured at amortized cost. At each statement of financial position date, on a forward-looking basis, the Company assesses the expected credit losses associated with its financial assets carried at amortized cost and FVOCI. The impairment methodology applied depends on whether there has been a significant increase in credit risk. The impairment model does not apply to FVTPL instruments.

The expected credit losses are required to be measured through a loss allowance at an amount equal to the 12-month expected credit losses (expected credit losses that result from those default events on the financial instrument that are possible within 12 months after the reporting date) or full lifetime expected credit losses (expected credit losses that result from all possible default events over the life of the financial instrument). A loss allowance for full lifetime expected credit losses is required for a financial instrument if the credit risk of that financial instrument has increased significantly since initial recognition.

Financial instruments recorded at fair value:

The fair value of quoted investments is determined by reference to market prices at the close of business on the statement of financial position date. Where there is no active market, fair value is determined using valuation techniques. These include using recent arm's length market transactions; reference to the current market value of another instrument which is substantially the same; discounted cash flow analysis; and, pricing models.

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CBLT INC.

Notes to the Consolidated Financial Statements

May 31, 2025 and 2024

(Expressed in Canadian dollars)

2. MATERIAL ACCOUNTING POLICIES – continued

Financial instruments that are measured at fair value subsequent to initial recognition are grouped into a hierarchy based on the degree to which the fair value is observable as follows:

• Level 1 - valuation based on quoted prices (unadjusted) in active markets for identical assets or liabilities;
• Level 2 - valuation techniques based on inputs other than quoted prices included in Level 1 that are observable for the asset or liability, either directly (i.e. as prices) or indirectly (i.e. derived from prices); and
• Level 3 - valuation techniques using inputs for the asset or liability that are not based on observable market data (unobservable inputs).

As at May 31, 2025, the carrying value of investments is recorded at fair value on the statement of financial position. Investment in public company shares which are traded in an active market, such as a recognized stock exchange, are carried at fair value using the quoted trading share price and would be considered Level 1. Investment in public company shares which are not traded in an active market are carried at fair value using inputs from observable markets where possible, but where this is not feasible, a degree of judgement and assumptions provided by management is required in establishing fair value. Changes in assumptions relating to these factors could affect the reported fair value of these financial instruments. These are included in Level 3 of the fair value hierarchy.

Comprehensive loss

Comprehensive loss is the change in the Company's net assets that results from transactions, events and circumstances from sources other than the Company's shareholders and includes items that are not included in profit or loss.

Share-based payments

The fair value of share options granted is measured at grant date, using an option pricing model, and is recognized over the vesting period of the options. The fair value is recognized as an expense with a corresponding increase in contributed surplus. For options with graded vesting, each tranche is measured separately, and the amount recognized as expense is adjusted to reflect the number of share options expected to vest. If the stock options are exercised, the proceeds are credited to share capital and the fair value at the date of grant is reclassified from contributed surplus to share capital.

Share-based payment arrangements in which the Company receives goods or services as consideration for its own equity instruments are accounted for at the fair value of the goods or services received, unless the fair value cannot be estimated reliably. If the Company cannot reliably estimate the fair value of the goods or services received, the Company measures their value by reference to the fair value of the equity instruments granted.

Critical areas of judgment and estimation uncertainty

The preparation of financial statements in conformity with IFRS requires management to make judgments, estimates and assumptions that affect the reported amounts of assets and

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CBLT INC.

Notes to the Consolidated Financial Statements

May 31, 2025 and 2024

(Expressed in Canadian dollars)

2. MATERIAL ACCOUNTING POLICIES – continued

Critical areas of judgment and estimation uncertainty – continued

liabilities and disclosures of contingent assets and liabilities as at the date of the financial statements and the reported amounts of revenues and expenses during the reporting periods presented. These judgments and estimates are continuously evaluated and are based on management's experience and knowledge of the relevant facts and circumstances. Actual results may differ from the amounts included in the audited consolidated financial statements.

Areas of significant judgment and estimates affecting the amounts recognized in the audited consolidated financial statements include:

(i) Valuation of share-based payments

The Company records all share-based payments using the fair value method. The Company uses the Black-Scholes model to determine the fair value of stock options. The main factor affecting the estimates of the fair value of stock options is the stock price expected volatility used. The Company currently estimates the expected volatility of its common shares based on the trading history of the Company taking into consideration the expected life of the options.

(ii) Valuation of financial instruments

A number of the Company's accounting policies and disclosures require the measurement of fair values, for the Company's financial instruments. When the measurement of fair values cannot be determined, based on quoted prices in active markets, fair value is measured using valuation techniques and models. The inputs to these models are taken from observable markets where possible but, where this is not feasible, a degree of judgment is required in establishing fair values. Changes in assumptions about these inputs to these models could affect the reported fair value of the Company's financial instruments.

When measuring fair value of an asset or liability, the Company uses market observable data to the extent that it is possible. To the extent that these estimates differ from those realized, the measured asset or liability, net earnings (loss), and/or comprehensive income (loss) will be affected in future periods.

(iii) Going Concern

The assessment of the going concern assumption requires management to take into account all available information about the future, which is at least, but is not limited to, 12 months from the end of the reporting period. The Company is aware that material uncertainties related to events or conditions may cast significant doubt upon the Company's ability to continue as a going concern.

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CBLT INC.

Notes to the Consolidated Financial Statements

May 31, 2025 and 2024

(Expressed in Canadian dollars)

2. MATERIAL ACCOUNTING POLICIES – continued

Loss per common share

Basic loss per share is computed by dividing the loss for the year by the weighted average number of common shares outstanding during the year, including contingently issuable shares which are included when the conditions necessary for the issuance have been met. Diluted earnings per share is calculated in a similar manner, except that the weighted average number of common shares outstanding is increased to include potentially issuable common shares from the assumed exercise of common share purchase options and warrants, if dilutive. The number of additional shares included in the calculation is based on the treasury stock method for options and warrants. Diluted loss per share does not include the effect of potentially issuable common shares if their effect is anti-dilutive.

Share capital

Financial instruments issued by the Company are classified as equity only to the extent they do not meet the definition of a financial liability or financial asset. The Company's common shares and flow-through shares are classified as equity instruments. Incremental costs directly attributable to the issuance of equity instruments are recognized as a deduction from the proceeds in equity in the period where the transaction occurs.

Segment disclosures

The Company currently operates in a single segment, the acquisition, exploration and development of mineral properties. All of the company's activities are conducted in Canada.

Adoption of new accounting standards

Future changes in accounting policies

Amendments to IFRS 9 Financial Instruments and IFRS 7 Financial Instruments: Disclosures. The amendments clarify the classification of financial assets with environmental, social and corporate governance and similar features and addresses concerns raised regarding the settlement of liabilities through electronic payment systems. The amendments are effective for annual periods beginning on or after January 1, 2026 with early adoption permitted.

In April 2024, the IASB issued IFRS 18 Presentation and Disclosure in Financial Statements which will replace IAS 1. This standard aims to improve the consistency and clarity of financial statement presentation and disclosures by providing updated guidance on the structure and content of financial statements. IFRS 18 is effective January 1, 2027, with early adoption permitted. The Company is assessing the impact on the Company's financial statements.

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CBLT INC.

Notes to the Consolidated Financial Statements

May 31, 2025 and 2024

(Expressed in Canadian dollars)

3. EXPLORATION AND EVALUATION PROPERTIES

During the year ended May 31, 2025 the following Exploration and Evaluation expenditures were incurred by the Company:

	2025	2024
Claims maintenance	12,914	18,363
Geological services	29,169	23,911
Prospecting	-	4,500
Total	42,083	46,773

Copper Prince

On June 14, 2016, the Company acquired a 100% interest in the Copper Prince property. As consideration the Company made a cash payment of $10,000 and issued 200,000 common shares at $0.08 per common share in favour of the vendor.

The property is subject to a 2% net smelter return royalty.

Copper Prince – continued

On August 4, 2016, the Company staked 4 mineral claims for a cash cost of $4,400. The claims are not adjacent to the Copper Prince property.

During 2025 fiscal year, the Company carried out $6,311 in exploration and evaluation activities.

Chilton Cobalt

On February 27, 2017, the Company acquired a 100% interest in the Chilton Cobalt property located in the Laurentian Region of Quebec. As consideration the Company issued 150,000 common shares at $0.07 per common share and 150,000 share purchase warrants exercisable at $0.10 per common share in favour of the vendor. The share purchase warrants issued for one property were assigned a fair value of $13,788 using the Black-Scholes valuation model with the following assumptions: expected dividend yield of 0%; volatility of 192%; risk-free interest rate of 1.20%; and an expected maturity of one year.

During the 2023 fiscal year, the Company entered into an option agreement with PowerStone Metals Corp. Terms of the option agreement include receipt of 1,000,000 special warrants convertible into 1,000,000 common shares of the optionee, completion of a private placement financing of $250,000 by the optionee, and the incurrence of $250,000 of exploration and evaluation expenditures over a two-year period. In the event common shares of the optionee were not listed on the Canadian Securities Exchange by September 30, 2023, the optionee would issue an additional 500,000 common shares to the Company. The optionee listed its common shares on the Canadian Securities Exchange during March 2023.

Geneva Lake

On November 12, 2012, the Company acquired a 100% interest in the Geneva Lake property. As consideration, the Company issued 200,000 common shares at a deemed price

18

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CBLT INC.
Notes to the Consolidated Financial Statements
May 31, 2025 and 2024
(Expressed in Canadian dollars)

1. EXPLORATION AND EVALUATION PROPERTIES – continued

Geneva lake – continued

of $0.10 per common share and 200,000 share purchase warrants exercisable at $0.20 per common share in favour of the vendor.

The property is subject to a 2.0% net smelter return royalty of which the Company can purchase a 50% interest at any time for $500,000.

During 2025 fiscal year, the Company carried out no exploration and evaluation activities.

Big Duck Lake

On March 12, 2019, the Company acquired a 100% interest in the Big Duck Lake property.

The Big Duck Lake property, located in Northern Ontario, is subject to a 2% net smelter return royalty in favour of previous owners of the claims. The Company may purchase one-half of the royalty for an aggregate amount of $1,000,000 at any time.

During 2025 fiscal year, the Company carried out $500 in exploration and evaluation activities.

Burnt Pond

On March 12, 2019, the Company acquired a 100% interest in the Burnt Pond property.

The Burnt Pond property is a Zinc-Copper Property located in central Newfoundland. The property is located in the Tally Pond volcanic belt which hosts Teck Resources Ltd's Duck Pond Mine and a number of other Copper-Zinc-Silver-Gold massive sulphide deposits.

During 2025 fiscal years, the Company carried out no exploration and evaluation activities.

Ryliejack

On January 31, 2012, the Company acquired a 100% interest in the Ryliejack property.

The property is subject to a 2.5% net smelter return royalty of which the Company can purchase a 50% interest at any time for $1,000,000.

During the 2024 fiscal year, the Company carried out no exploration and evaluation activities.

During the 2024 fiscal year, the Company sold the Ryliejack property for cash consideration of $180,000 and the granting of a 2% NSR.

Mikayla

On March 2, 2012, the Company acquired a 100% interest in the Mikayla property. On November 4, 2012, the Company acquired a 100% interest in properties adjoining the Mikayla property.

The property is subject to a 2.5% net smelter return royalty of which the Company can purchase a 50% interest at any time for $1,000,000.

19

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CBLT INC.
Notes to the Consolidated Financial Statements
May 31, 2025 and 2024
(Expressed in Canadian dollars)

1. EXPLORATION AND EVALUATION PROPERTIES – continued

Mikayla – continued
During 2025 fiscal year, the Company determined that the Mikayla would not be a part of the Company's holdings and allowed the claims comprising the Mikayla property to lapse.

Shatford Lake
During the 2021 fiscal the Company acquired the Shatford Lake property. The Shatford Lake property consists of two mining claims located in the Bird River Greenstone Belt in Manitoba.

Consideration for the acquisition include a cash payment in the amount of $25,000 and the granting of a 2% NSR 50% of which can be acquired by the Company for $1,000,000.

During the 2025 fiscal year, the Company carried out no exploration and evaluation activities.

Cape Victoria
During fiscal 2023, the Company staked 23 claim units comprising the Cape Victoria property which is located approximately 5 km east of Terrace Bay in Northern Ontario.

During the 2025 fiscal year, the Company determined that It had no further interest in the Cape Victoria property and allowed the claims to lapse.

Falcon Gold
On May 31, 2023, the Company purchased a 100% interest in the Falcon Gold property consisting of six patented mining claims. Consideration for the acquisition included a cash payment including transaction costs in the amount of $35,110 and the granting of a 2% NSR.

During the 2025 fiscal year, the Company carried out $35,272 in exploration and evaluation activities.

1. INVESTMENTS

	2025	2024
Newpath Resources Inc.	$ 14,300	$ 17,417
PowerStone Metals Corp.	10,000	11,250
	$ 24,300	$ 28,667

The investment on Newpath Resources Inc. (formerly Ready Set Gold Corp.) consists of 357,499 common shares less 18,333 common shares to be distributed as finders' fees. The fair value of the shares reflects the consideration received on the sale of a mineral property to an unrelated entity. Newpath Resources Inc. is listed on the Canadian Securities Exchange. During the year the carrying value of the investment was adjusted to the market value of the shares resulting in an unrealized loss of $3,117 (2024-$57,475).

The investment in PowerStone Metals Corp. ("PowerStone") initially consisted of 1,000,000 special warrants convertible to 1,000,000 common shares. The special warrants were received as consideration pursuant to an option agreement in connection with a mineral

20

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CBLT INC.
Notes to the Consolidated Financial Statements
May 31, 2025 and 2024
(Expressed in Canadian dollars)

4. INVESTMENTS – continued

property. PowerStone was a private company whose business model is the acquisition and development of mineral properties in Quebec. The special warrants have been valued initially at face amount of $20,000 subsequently adjusted to reflect the price at which securities were issued to unrelated third parties, resulting in an unrealized gain of $80,000.

PowerStone cleared a prospectus at which time the 1,000,000 special warrants were converted to 1,000,000 common shares.

On March 6, 2023, the Company declared a dividend with a Record Date of March 8, 2023, in the amount of $75,000 to be paid in shares of PowerStone. Payment of the dividend resulted in the distribution of 750,000 shares of PowerStone on March 10, 2023. Subsequently, PowerStone listed its common shares on the Canadian Securities Exchange. Adjustment to market value of the PowerStone common shares resulted in an unrealized loss of $6,250 for fiscal 2023. During the 2025 fiscal year, adjustment to market value of the PowerStone common shares resulted in an unrealized loss of $1,250 (2024-$7,500).

5. CEBA

During the 2021 fiscal year, the Company received a non-interest bearing loan of $60,000 from the Government of Canada through the Canada Emergency Business Account (CEBA) program. The loan is due on December 31, 2023 and payment by the due date will result in $20,000 forgiveness of the loan. The Company has the discounted amount of the balance of the loan in the amount of $12,331 as government assistance. During the 2024 fiscal year, accretion of $1,701 was recorded with respect to the discounted amount, the Company repaid $40,000 of the loan, and recognized $20,000 as income.

6. RELATED PARTY TRANSACTIONS

Related parties include the Board of Directors and officers, close family members and enterprises that are controlled by these individuals as well as certain consultants performing similar functions.

The Company had the following transactions in the normal course of operations with related parties during the year ended 2025 and 2024:

	2025	2024
Management fees (i)	$ 132,000	$ 132,000
Share-based compensation (ii)	-	50,019
	$ 132,000	$ 182,019

(i) The Company paid or accrued $66,000 (2024 - $66,000) in management fees to the CEO of the Company and $66,000 (2024 - $66,000) to the CFO of the Company. Management fees were paid to the respective holding companies of the CEO and CFO, Maplegrow Capital Inc. and Brant Capital Partners Inc. respectively.

21

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CBLT INC.
Notes to the Consolidated Financial Statements
May 31, 2025 and 2024
(Expressed in Canadian dollars)

1. RELATED PARTY TRANSACTIONS - continued

(ii) The Company granted 2,150,000 options to directors and officers during the 2024 fiscal year.

Accounts payable and accrued liabilities include $73,865 (2024 - $nil) due to related parties. These amounts are unsecured, non-interest bearing and have no fixed terms of repayment.

1. SHARE CAPITAL

Authorized
Unlimited number of common shares without par value

Issued and outstanding

	Number of Shares	Share Capital
Balance May 31, 2023	76,177,073	$ 4,355,364
Issued during the year	1,000,000	25,000
Balance May 31, 2024	77,177,073	$ 4,380,364
Issued during the year	-	-
Balance May 31, 2025	77,177,073	$ 4,380,364

Share issuances

2025

There were no share issuances during the year ended May 31, 2025.

2024

On December 27, 2023, the Company issued 500,000 units at $0.05 per unit for gross proceeds of $25,000, with each unit consisting of one common share designated as a flow-through share and one common share purchase warrant exercisable at $0.06 per common share for a period of twenty-four months from the date of issue.

On January 30, 2024, the Company issued 500,000 units at $0.05 per unit for gross proceeds of $25,000, with each unit consisting of one common share designated as a flow-through share and one common share purchase warrant exercisable at $0.06 per common share for a period of twenty-four months from the date of issue

1. SHARE-BASED PAYMENTS

The Company has established a stock option plan whereby the Board of Directors may grant options to directors, officers and consultants to purchase common shares of the Company. The stock option plan is a rolling plan and the maximum number of authorized but unissued

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CBLT INC.
Notes to the Consolidated Financial Statements
May 31, 2025 and 2024
(Expressed in Canadian dollars)

1. SHARE-BASED PAYMENTS – continued

shares available to be granted shall not exceed 10% of its issued and outstanding common shares. Each stock option granted is for a term not exceeding five years unless otherwise specified.

The following table summarizes the continuity of the Company's stock options:

	Number of Options	Weighted Average Exercise Price
Balance May 31, 2023	3,600,000	$ 0.05
Granted	2,150,000	0.05
Cancelled or expired	(600,000)	0.05
Balance May 31, 2024	5,150,000	$ 0.05
Granted	-	-
Cancelled or expired	-	-
Balance May 31, 2025	5,150,000	$ 0.05

At May 31, 2025, the Company had outstanding stock options, enabling holders to acquire common shares as follows:

Number of options outstanding	Number of options Exercisable	Exercise price	Expiry date
1,000,000	1,000,000	0.05	August 20, 2025
1,900,000	1,900,000	0.055	November 29, 2026
100,000	100,000	0.05	April 6, 2027
2,150,000	2,150,000	0.05	September 10, 2028
5,150,000	5,150,000

The weighted average contractual life of the options outstanding at May 31, 2025 is 2.00 years (2024-3.00 years).

The total number of options exercisable as at May 31, 2025 is 5,150,000 (May 31, 2024 - 5,150,000).

Options Issued to Employees

Options issued to employees are measured at fair value at the grant date using a Black-Scholes option pricing model that takes into account the exercise price, the term of the option, the impact of dilution, the share price at grant date, the expected price volatility of the underlying share, the expected dividend yield, expected forfeitures and the risk-free interest rate for the term of the option.

Options Issued to Non-Employees

Options issued to non-employees are measured based on the fair value of the goods or services received, at the date of receiving those goods or services. If the fair value of the goods or services received cannot be estimated reliably, the options are measured by

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CBLT INC.
Notes to the Consolidated Financial Statements
May 31, 2025 and 2024
(Expressed in Canadian dollars)

1. SHARE-BASED PAYMENTS - continued

determining the fair value of the options granted using the Black-Scholes option pricing model.

Total expenses arising from the share-based payment transactions recognized during the year as part of share-based compensation expense was $nil (May 31, 2024 - $50,919).

Model inputs for options granted during the year ended May 31, 2024 include.

Grant date	Expiry date	Share price at grant date	Exercise price	Risk-free interest rate	Expected life	Volatility factor	Dividend yield
September 10, 2023	September 10, 2028	$ 0.025	$ 0.05	3.96%	5 years	172%	0%

1. WARRANTS

The following common share purchase warrants entitle the holders thereof the right to purchase one common share for each common share purchase warrant. Warrant transactions and the number of share purchase warrants outstanding as at May 31, 2025 are summarized as follows:

	Exercise Price	Expiry Date	Number Outstanding May 31, 2024	Number Outstanding May 31, 2025
Private placement	$0.06	December 27, 2025	500,000	500,000
Private placement	$0.06	January 30, 2026	500,000	500,000

1. PROVISION FOR INDEMNIFICATION OF FLOW-THROUGH SUBSCRIBERS

The following table summarizes the continuity of the provision:

	2025	2024
Opening Balance	$ 156,000	$ 387,000
Adjustment to provision	-	(5,000)
Interest accretion	12,000	14,000
Reversal of previous provision	-	(224,231)
Transfer of provision to accounts payable	-	(15,769)
Closing Balance May 31	$ 168,000	$ 156,000

As at December 31, 2021, the Company was committed to incur $ 232,830 in qualifying Canadian exploration expenditures prior to January 1, 2023, pursuant to a 2021 private placements for which flow-through share proceeds had been received by the Company and then renounced to subscribers effective December 31, 2021.

24

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CBLT INC.
Notes to the Consolidated Financial Statements
May 31, 2025 and 2024
(Expressed in Canadian dollars)

1. PROVISION FOR INDEMNIFICATION OF FLOW-THROUGH SUBSCRIBERS - continued

The Company incurred actual qualifying expenditures of $24,152 in 2022, leaving a shortfall of $208,678 as at December 31, 2022. Accordingly, effective December 31, 2022 the Company recorded (in other expenses and current liabilities) a $147,000 provision for the estimated cost to indemnify flow-through share subscribers for their expected personal.

income tax reassessments by Canada Revenue Agency attributable to each subscriber's proportionate share of the shortfall. The indemnifications are provided for in the underlying subscription agreements for the private placement. The governmental audit/reassessment process may be lengthy; therefore, it may be several months or longer before the Company's final liability is exigible.

The Company has made the following assumptions in estimating the subscriber indemnification provision:

• Ontario subscribers have a combined personal income tax rate of 53.53% and are eligible for both the federal 15% and the provincial 5% investment tax credits;
• The $208,678 shortfall applies to Ontario subscribers; and
• Subscribers will be assessed two year's interest on reassessed amounts.

As at May 31, 2024 and 2025, the Company has also accrued in accounts payable and accrued liabilities, the estimated Federal Part XII.6 tax for the 2022 year.

As at December 31, 2022, the Company had a $57,036 flow-through share premium liability which was transferred to the deferred tax provision effective December 31, 2022, in recognition of the Company's indemnification accrual.

During the year 2024, the Company derecognized the balance of the provision related to 2017.

1. FINANCIAL RISK FACTORS

The Company's activities expose it to a variety of financial risks: credit risk, liquidity risk and market risk (including interest rate, foreign exchange rate and commodity price risk). Risk management is carried out by the Company's management team with guidance from the Audit Committee and Board of Directors. The Board of Directors also provides regular guidance for overall risk management.

Fair value

The methods and assumptions used to develop fair value measurements, for those financial instruments where fair value is recognized in the statement of financial position, have been prioritized into three levels to classify fair value measurements using a fair value hierarchy that reflects the significance of the inputs used in making the measurements. The fair value hierarchy has the following levels:

a. quoted prices (unadjusted) in active markets for identical assets or liabilities (Level 1);

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CBLT INC.

Notes to the Consolidated Financial Statements

May 31, 2025 and 2024

(Expressed in Canadian dollars)

11. FINANCIAL RISK FACTORS - continued

Fair value - continued

b. inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly (i.e., as prices) or indirectly (i.e., derived from prices) (Level 2); and each subscriber's proportionate share of the shortfall. The indemnifications are provided for in the underlying subscription agreements for the private placements. The governmental audit/reassessment process may be lengthy; therefore, it may be several months or longer before the Company's final liability is exigible.

c. inputs for the asset or liability that are not based on observable market data (unobservable inputs) (Level 3).

The level in the fair value hierarchy within which the fair value measurement is categorized in its entirety is determined on the basis of the lowest level input that is significant to the fair value measurement in its entirety. For this purpose, the significance of an input is assessed against the fair value measurement in its entirety. If a fair value measurement uses observable inputs that require significant adjustment based on unobservable inputs, that measurement is a Level 3 measurement. Assessing the significance of a particular input to the fair value measurement in its entirety requires judgment, considering factors specific to the asset or liability.

The Company's financial instruments measured at amortized cost include accounts payable and accrued liabilities. The carrying values of this financial instrument approximate fair value due to their short-term maturity.

Credit risk

Credit risk is the risk of loss associated with a counterparty's inability to fulfill its payment obligations. The Company's credit risk is primarily attributable to cash and cash equivalents and sundry receivables. The Company has no significant concentration of credit risk arising from operations. Cash and cash equivalents are held with a reputable Canadian chartered bank. Management believes that the credit risk concentration with respect to financial instruments is minimal.

Liquidity risk

Liquidity risk is the risk that the Company will not have sufficient cash resources to meet its financial obligations as they come due. The Company's liquidity and operating results may be adversely affected if the Company's access to the capital markets is hindered, whether as a result of a downturn in stock market conditions generally or related to matters specific to the Company. The Company generates cash flow primarily from its financing activities.

As at May 31, 2025, the Company had cash and cash equivalents of $5,757 (May 31, 2024 - $173,480) to meet obligations of $366,940 (May 31, 2024-$286,864). All of the Company's financial liabilities have contractual maturities of less than 30 days and are subject to normal trade terms. The Company regularly evaluates its cash position to ensure preservation and security of capital as well as maintenance of liquidity.

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CBLT INC.
Notes to the Consolidated Financial Statements
May 31, 2025 and 2024
(Expressed in Canadian dollars)

11. FINANCIAL RISK FACTORS – continued

Market risk

(a) Interest rate risk

The Company has a cash balance and no interest-bearing debt. The Company is not exposed to significant interest rate risk due to the short-term maturity of its monetary assets and liabilities.

(b) Foreign currency risk

Foreign currency risk is the risk that future cash flows will fluctuate as a result of changes in foreign currency rates. The Company is not currently exposed to any significant foreign currency risk.

Price risk

The Company is exposed to price risk with respect to commodity prices. Commodity price risk is defined as the potential adverse impact on earnings and economic value due to commodity price movements and volatilities. The Company closely monitors commodity prices as they relate to gold to determine the appropriate course of action to be taken.

12. CAPITAL MANAGEMENT

The Company manages its capital with the following objectives:

• to ensure sufficient financial flexibility to achieve the ongoing business objectives including funding of future growth opportunities, and pursuit of accretive acquisitions; and
• to maximize shareholder return through enhancing the share value.

The Company monitors its capital structure and makes adjustments according to market conditions in an effort to meet its objectives given the current outlook of the business and industry in general. The Company may manage its capital structure by issuing new shares, repurchasing outstanding shares, adjusting capital spending, or disposing of assets. The capital structure is reviewed by management and the Board of Directors on an ongoing basis. The Company considers its capital to be total shareholders' equity, comprising share capital, contributed surplus and deficit which at May 31, 2025 totaled ($303,655) (May 31, 2024 – ($59,301)).

The Company manages capital through its financial and operational forecasting processes. The Company reviews its working capital and forecasts its future cash flows based on operating expenditures, and other investing and financing activities. The forecast is updated based on

activities related to its mineral properties. Selected information is provided to the Board of Directors of the Company. The Company's capital management objectives, policies and processes have remained unchanged during the year ended May 31, 2025. The Company is not subject to any capital requirements imposed by a lending institution.

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CBLT INC.

Notes to the Consolidated Financial Statements

May 31, 2025 and 2024

(Expressed in Canadian dollars)

13. INCOME TAXES

Provision for Income Taxes

The following table reconciles the expected income tax provision at the statutory income tax rate of 26.5% (2024 - 26.5%) to the amounts recognized in the statements of loss and comprehensive loss:

	2025	2024
Income (loss) before income taxes	$ (244,354)	$ 38,799
Expected income tax recovery at the statutory tax rate	(64,754)	10,282
Share-based compensation	-	13,255
Loss (gain) on financial instruments held at fair value through profit and loss unrealized	1,157	17,218
Gain on sale of mineral properties	-	(47,700)
Share issue costs	(293)	(294)
Other	11,152	(9,115)
Benefit of tax losses not recognized	52,738	16,354
Benefit of deferred tax assets recognized	-	-
Income tax (recovery)	$ -	$ (3,074)

Provision for income taxes consists of the following

Deferred income taxes (recovery)	-	-
Non-capital loss carry-forward	-	-
	$ -	$ -

The following temporary differences have not been recognized in the consolidated financial statements.

	2025	2024
Non-capital loss carry-forwards	$ 3,873,000	$ 3,681,000
Share issuance costs	-	1,000
Marketable securities	1,169,000	1,165,000
Resource related assets	35,000	42,000
Other temporary differences	-	-
	$ 5,077,000	$ 4,889,000

Tax loss carry-forwards

As at May 31, 2025, the Company had approximately $3,873,000 (2024 - $3,681,000) of non-capital losses which can be used to reduce taxable income in future years.

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CBLT INC.
Notes to the Consolidated Financial Statements
May 31, 2025 and 2024
(Expressed in Canadian dollars)

14. COMMITMENTS AND CONTINGENCIES

Flow-through Shares

On issuance, the Company bifurcates the flow-through share into i) a flow-through share premium, equal to the estimated premium if any, investors pay for the flow-through feature, which is recognized as a liability, and ii) share capital. Upon expenses being incurred, the Company derecognizes the liability and recognizes a deferred tax liability for the amount of tax reduction renounced to the shareholders. The premium is recognized as a tax provision and the related deferred tax is recognized as a tax provision. Other liabilities include the premium that has not yet been used to incur qualifying exploration expenditures. The following is a continuity schedule of the liability portion of the flow-through shares issuances

Balance at May 31, 2024	$	38,516
Expenditure commitment on flow-through shares issued during the year		-
Settlement of flow-through share liability on incurring expenditures		(28,669)
Balance at May 31, 2025	$	9,847

15. SUPPLEMENTAL CASH FLOW INFORMATION

Supplemental schedule of non-cash transactions:	2025	2024
Interest paid	$ -	$ -
Taxes paid	-	-
Sale of mineral property	-	-
Repayment of promissory note and accrued interest	-	-

16. SUBSEQUENT EVENTS

On June 6, 2025, the Company received a loan from a shareholder in the amount of $25,000.

On June 6, 2025, the Company received a promissory note in exchange for cash of $20,000. The promissory note bears interest at 8% per annum.

On August 30, 2025, 1,000,000 stock options exercisable at $0.05, expired unexercised.

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