NIOCORP DEVELOPMENTS LTD 10-Q

ITEM 4. CONTROLS AND PROCEDURES Disclosure Controls and Procedures The management of NioCorp Developments Ltd. has evaluated, under the supervision of and with the participation of the Chief Executive Officer (“CEO”) and the Chief Financial Officer (“CFO”), the effectiveness of our disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act) as of March 31, 2026. Based on that evaluation, the 29 CEO and the CFO have concluded that, as of March 31, 2026, our disclosure controls and procedures were not effective due to the material weaknesses in internal control over financial reporting described below. Notwithstanding the material weaknesses in our internal control over financial reporting, our CEO and CFO have concluded that the interim condensed consolidated financial statements included in this Quarterly Report on Form 10-Q fairly present, in all material respects, our financial position, results of operations and cash flows for the periods presented in conformity with U.S. GAAP. Material Weaknesses in Internal Control over Financial Reporting Existing as of March 31, 2026 The management of NioCorp Developments Ltd. is responsible for establishing and maintaining adequate internal control over financial reporting as defined in Rules 13a-15(f) and 15d-15(f) of the Exchange Act for the Company. Management assessed the effectiveness of our internal control over financial reporting as of March 31, 2026. In making this assessment, our management used the criteria set forth in the Internal Control - Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission (the “COSO Framework”). Based on that evaluation, the CEO and the CFO have concluded that, as of March 31, 2026, our internal control over financial reporting was not effective due to the material weaknesses in internal control over financial reporting described below. Material Weaknesses A material weakness is a deficiency, or a combination of deficiencies, in internal control over financial reporting, such that there is a reasonable possibility that a material misstatement of our annual or interim consolidated financial statements will not be prevented or detected on a timely basis. Management concluded that the material weaknesses disclosed in the Company’s Annual Report on Form 10-K for the fiscal year ended June 30, 2025, continued to exist as of March 31, 2026. Specifically, management identified deficiencies in the principles associated with the control environment, risk assessment, control activities, and monitoring components of internal control, based on the criteria established by the COSO Framework, that constitute material weaknesses, either individually or in the aggregate. • Control Environment : The Company does not have sufficient personnel with the appropriate levels of knowledge, experience, and training in accounting and internal control over financial reporting commensurate with the complexity of the Company’s financing transactions and associated reporting requirements. This material weakness contributed to additional material weaknesses further described below. • Risk Assessment : The Company does not have a formal process to identify, update, and assess financial reporting risks due to changes in the Company’s business practices, including entering into increasingly complex transactions that could significantly impact the design and operation of the Company’s control activities. • Control Activities : Management did not maintain effective controls over: o monitoring and assessing the work of third-party specialists, including the evaluation of the appropriateness of accounting conclusions, o the evaluation of certain inputs and assumptions used to estimate the fair value of instruments and features associated with complex debt and equity transactions, and o the design and implementation of effective process-level control activities related to vendor banking information. • Monitoring Activities : Management did not appropriately: o select, develop, and perform ongoing evaluation to ascertain whether the components of internal controls are present and functioning, and o evaluate and communicate internal control deficiencies in a timely manner to those parties responsible for taking corrective action. As previously disclosed, these material weaknesses resulted in errors that required the restatement of Company’s consolidated financial statements as of and for the fiscal years ended June 30, 2022 and 2021, as well as the restatement of the Company’s condensed consolidated financial statements as of and for the interim periods ended September 30, 2021, December 31, 2021, March 31, 2022, September 30, 2022, and December 31, 2022. Additionally, these material weaknesses could result in a 30 misstatement of the account balances or disclosures that would result in a material misstatement to the annual or interim consolidated financial statements that would not be prevented or timely detected. Remediation Plan for the Material Weaknesses To address our material weaknesses existing as of March 31, 2026, we have implemented and continue to develop a remediation plan to address each individual material weakness identified. While these remediation efforts are ongoing and the material weaknesses continue to exist, management has taken measured steps to strengthen the Company’s internal control environment. These actions include the following: • We have engaged, and will continue to engage, outside accounting and internal control consultants with relevant expertise to supplement internal resources. • We have developed a formal risk assessment process requiring periodic review and updates of current risks, internal controls, and financial reporting risks, and the results of this process are reviewed with management and periodically communicated to the Audit Committee. • We continue to evaluate and hire additional personnel to support accounting, finance, and internal control oversight functions. • We have initiated the implementation of certain systems and tools intended to enhance financial reporting processes and internal controls, including enterprise accounting and financial reporting software and an initial training plan to provide incremental training to accounting and finance personnel. These initiatives have been implemented, however the related controls have not yet operated for a sufficient period of time to conclude on their effectiveness. • Management has advanced the development of a monitoring program to support the evaluation of whether controls are designed and, as implemented, are operating as intended such that there is contemporaneous evidence that the components of internal control are present and functioning and to communicate internal control deficiencies in a timely manner to those responsible for remediation. The process of designing and maintaining effective internal control over financial reporting is a continuous effort that requires management to anticipate and react to changes in our business, economic, and regulatory environments and to expend significant resources. As we continue to evaluate our internal control over financial reporting, we may take additional actions to remediate the material weaknesses or modify the remediation actions described above. While we continue to devote significant time and attention to these remediation efforts, the material weaknesses will not be considered remediated until management completes the design and implementation of the actions described above and the controls operate for a sufficient period of time, and management has concluded, through testing, that these controls are effective. Changes in Internal Control over Financial Reporting Other than as discussed above, there has been no change in our internal control over financial reporting during the quarter ended March 31, 2026, that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting. PART II — OTHER INFORMATION