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Item 2. Management’s Discussion and Analysis

2023-05-30 compared with 2023-02-13 · 615 added, 514 removed, 46 unchanged (96% of the section changed)

1 unchanged sentence

following discussion and analysis should be read in conjunction with our unaudited interim condensed consolidated financial statements

as of, and for the three and six months ended December 31, 2022, and the related notes thereto, which have been prepared in accordance

as of, and for the three and nine months ended March 31, 2023, and the related notes thereto, which have been prepared in accordance

with generally accepted accounting principles in the United States (“U.S.

5 unchanged sentences

Statements” below.

All currency amounts are stated in thousands

currency amounts are stated in thousands of U.S.

dollars unless noted otherwise.

As used in this report, unless the context

otherwise indicates, references to “we,” “our,” the “Company,” “NioCorp,” and “us”

refer to NioCorp Developments Ltd.

used in this report, unless the context otherwise indicates, references to “we,” “our,” the “Company,”

“NioCorp,” and “us” refer to NioCorp Developments Ltd.

and its subsidiaries, collectively.

Note Regarding Forward-Looking Statements

This Quarterly Report on Form 10-Q and

the exhibits attached hereto contain “forward-looking statements” within the meaning of Section 27A of the Securities

Act of 1933, as amended (the “Securities Act”), and Section 21E of the Securities Exchange Act of 1934, as amended

(the “Exchange Act”), and “forward-looking information” within the meaning of applicable Canadian securities

legislation (collectively, “forward-looking statements”).

Such forward-looking statements concern our anticipated results

and developments in the operations of the Company in future periods, planned exploration activities, the adequacy of the Company’s

financial resources, and other events or conditions that may occur in the future.

Forward-looking statements have been based

upon our current business and operating plans, as approved by the Company’s Board of Directors, and may include statements

regarding our cash and other funding requirements and timing and sources thereof;

results of feasibility studies;

of mineral resource and reserve estimates and assumptions on which they are based;

the results of economic assessments and exploration

and current market conditions and project development plans, and the Transaction (as defined below).

The material assumptions

used to develop the forward-looking statements and forward-looking information included in this Quarterly Report on Form 10-Q include:

our expectations of mineral prices;

our forecasts and expected cash flows;

our projected capital and operating costs;

of mineral resource estimates and resource modeling and feasibility study results;

expectations regarding mining and metallurgical

timing and reliability of sampling and assay data;

anticipated political and social conditions;

expected national and

local government policies, including legal reforms;

successful advancement of the Company’s required permitting processes;

and the ability to successfully raise additional capital;

NioCorp and GX Acquisition Corp.

II, a Delaware corporation (“GXII”),

being able to receive all required regulatory, third-party and shareholder approvals for the proposed Transaction;

the amount of

redemptions by GXII public stockholders;

the consummation of the convertible debenture transaction and the standby equity purchase

facility contemplated by the definitive agreements with YA II PN, Ltd., an investment fund managed by Yorkville Advisors Global,

LP (together with YA II PN, Ltd., “Yorkville”);

and other current estimates and assumptions regarding the proposed

Transaction and its benefits.

Forward-looking statements are frequently,

but not always, identified by words such as “expects,” “anticipates,” “believes,” “intends,”

“estimates,” “potential,” “possible,” and similar expressions, or statements that events, conditions,

or results “will,” “may,” “could,” or “should” (or the negative and grammatical

variations of any of these terms) occur or be achieved.

Any statements that express or involve discussions with respect to predictions,

expectations, beliefs, plans, projections, objectives, assumptions, or future events or performance (often, but not always, using

words or phrases such as “expects” or “does not expect,” “is expected,” “anticipates”

or “does not anticipate,” “plans,” “estimates,” or “intends,” or stating that certain

actions, events, or results “may,” “could,” “would,” “might,” or “will”

be taken, occur or be achieved) are not statements of historical fact and may be forward-looking statements.

Such forward-looking

statements reflect the Company’s current views with respect to future events and are subject to certain known and unknown

risks, uncertainties, and assumptions.

Many factors could cause actual results, performance, or achievements to be materially different

from any future results, performance, or

that may be expressed or implied by such forward-looking statements, including, among others, risks related to the following:

Risks Related to Our Business:

risks related to our ability to operate as a going concern;

risks related to our requirement of significant additional capital;

risks related to our limited operating history;

risks related to our history of losses;

risks related to the restatement of our consolidated financial statements as of and for the fiscal years ended June 30, 2022 and 2021 and the interim periods ended September 30, 2021, December 31, 2021, and March 31, 2022 (collectively, the “Affected Periods”) and the impact of such restatement on our future financial statements and other financial measures;

risks related to the material weakness in our internal control over financial reporting, our efforts to remediate such material weakness and the timing of remediation;

risks related to cost increases for our exploration and, if warranted, development projects;

risks related to a disruption in, or failure of, our information technology systems, including those related to cybersecurity;

risks related to equipment and supply shortages;

risks related to current and future offtake agreements, joint ventures, and partnerships;

risks related to our ability to attract qualified management;

risks related to the effects of the COVID-19 pandemic or other global health crises on our business plans, financial condition, and liquidity;

risks related to the ability to enforce judgment against certain of our directors.

Risks Related to Mining and Exploration:

risks related to estimates of mineral resources and reserves;

risks related to mineral exploration and production activities;

risks related to our lack of mineral production from our properties;

risks related to the results of our metallurgical testing;

risks related to the price volatility of commodities;

risks related to the establishment of a reserve and resource for Rare Earth Elements (“REEs” or “Rare Earths”) and the development of a viable recovery process for REEs;

risks related to the estimation of mineral resources and mineral reserves;

risks related to changes in mineral resource and reserve estimates;

risks related to competition in the mining industry;

risks related to the management of the water balance at the Elk Creek Niobium/Scandium/Titanium development stage property (the “Elk Creek Project”) located in southeastern Nebraska;

risks related to claims on the title to our properties;

risks related to potential future litigation;

risks related to our lack of insurance covering all our operations.

Risks Related to Government Regulations:

risks related to our ability to obtain or renew permits and licenses for production;

risks related to government and environmental regulations that may increase our costs of doing business or restrict our operations;

risks related to changes in federal and/or state laws that may significantly affect the mining industry;

risks related to the impacts of climate change, as well as actions taken or required by governments related to strengthening resilience in the face of potential impacts from climate change;

risks related to land reclamation requirements.

Risks Related to Our Debt:

risks related to covenants contained in agreements with our secured creditors that may affect our assets;

risks related to the extent to which our level of indebtedness may impair our ability to obtain additional financing.

Risks Related to Our Common Shares:

risks related to qualifying as a “passive foreign investment company” under the U.S.

Internal Revenue Code of 1986, as amended (the “Code”);

risks related to our Common Shares, including price volatility, lack of dividend payments, dilution, and penny stock rules.

Risks Related to the Proposed Transaction

risks related to the amount of any redemptions by GXII public stockholders being greater than expected, which may reduce the cash in trust available to NioCorp upon the consummation of the Transaction;

risks related to the occurrence of any event, change or other circumstances that could give rise to the termination of the Business Combination Agreement (as defined below) and/or payment of the termination fees;

risks related to the outcome of any legal proceedings that may be instituted against NioCorp or GXII following announcement of the Business Combination Agreement and the Transaction;

risks related to the inability to complete the Transaction due to, among other things, the failure to obtain NioCorp shareholder approval or GXII stockholder approval or the failure to consummate the Yorkville Financings;

risks related to the inability to complete the Yorkville Financings due to, among other things, the failure to obtain shareholder approval or regulatory approval;

the risk that the announcement and consummation of the Transaction disrupts NioCorp’s current plans;

risks relating to the ability to recognize the anticipated benefits of the Transaction;

risks relating to unexpected costs related to the Transaction;

the risks that the consummation of the Transaction is substantially delayed or does not occur, including prior to the date on which GXII is required to liquidate under the terms of its charter documents.

Should one or more of these risks or uncertainties

materialize, or should underlying assumptions prove incorrect, actual results may vary materially from those described herein.

This list is not exhaustive of the factors that may affect any of the Company’s forward-looking statements.

Regarding Forward-Looking Statements

Quarterly Report on Form 10-Q and the exhibits attached hereto contain “forward-looking statements” within the meaning

of Section 27A of the Securities Act of 1933, as amended (the “Securities Act”), and Section 21E of the Securities

Exchange Act of 1934, as amended (the “Exchange Act”), and “forward-looking information” within the meaning

of applicable Canadian securities legislation (collectively, “forward-looking statements”).

Such forward-looking statements

concern our anticipated results and developments in the operations of the Company in future periods, planned exploration activities,

the adequacy of the Company’s financial resources, and other events or conditions that may occur in the future.

Forward-looking

statements are statements about the future and are inherently uncertain, and actual achievements of the Company or other future

events or conditions may differ materially from those reflected in the forward-looking statements due to a variety of risks, uncertainties,

and other factors, including without limitation those discussed under the heading “Risk Factors” of our Annual Report

on Form 10-K/A for the fiscal year ended June 30, 2022, as well as other factors described elsewhere in this report and the Company’s

other reports filed with the Securities and Exchange Commission (“SEC”).

The Company’s forward-looking statements

contained in this Quarterly Report on Form 10-Q are based on the beliefs, expectations, and opinions of management as of the date

of this report.

The Company does not assume any obligation to update forward-looking statements if circumstances or management’s

beliefs, expectations, or opinions should change, except as required by law.

For the reasons set forth above, investors should

not attribute undue certainty to, or place undue reliance on, forward-looking statements.

Qualified Person

All technical and scientific information

that forms the basis for the Elk Creek Project disclosure included in this Quarterly Report on Form 10-Q has been reviewed and

approved by Scott Honan, M.Sc., SME-RM, NioCorp’s Chief Operating Officer.

Honan is a “Qualified Person”

as such term is defined in National Instrument 43-101 – Standards of Disclosure for Mineral Projects and subpart 1300 of

Regulation S-K.

Company Overview

NioCorp is developing the Elk Creek Project,

located in southeast Nebraska.

The Elk Creek Project is an advanced Niobium (“Nb”), Scandium (“Sc”) and

Titanium (“Ti”) development stage property.

The Company is evaluating the potential to produce several Rare Earth byproducts

from the Elk Creek Project.

Niobium is used to produce various superalloys that are extensively used in high performance aircraft

and jet turbines.

It also is used in High-Strength, Low-Alloy (“HSLA”) steel, a stronger steel used in automobiles,

bridges, structural systems, buildings, pipelines, and other applications that generally increases strength and/or reduces weight,

which can result in environmental benefits, including reduced fuel consumption and material usage and fewer air emissions.

can be combined with aluminum to make high-performance alloys with increased strength and improved corrosion resistance.

also is a critical component of advanced solid oxide fuel cells, an environmentally preferred technology for high-reliability,

distributed electricity generation.

Titanium is a component of various superalloys and other applications that are used for aerospace

applications, weapons systems, protective armor, medical implants, and many others.

It also is used in pigments for paper, paint,

and plastics.

Rare Earths are critical to electrification and decarbonization initiatives and can be used to manufacture the strongest

permanent magnets commercially available.

Our primary business strategy is to advance

our Elk Creek Project to commercial production.

We are focused on obtaining additional funds to carry out our near-term planned

work programs associated with securing the project financing necessary to complete mine development and construction of the Elk

statements have been based upon our current business and operating plans, as approved by the Company’s Board of Directors,

and may include statements regarding the anticipated benefits of the Transactions (as defined below), including NioCorp’s

ability to access the full amount of the expected net proceeds of the Yorkville Equity Facility Financing Agreement (as defined

below) over the next three years;

NioCorp’s ability to receive a final commitment of financing from the Export-Import Bank

of the United States (“EXIM”);

anticipated benefits of the listing of NioCorp’s common shares, without par value

(the “Common Shares”), on The Nasdaq Stock Market LLC (“Nasdaq”);

the financial and business performance

NioCorp’s anticipated results and developments in the operations of NioCorp in future periods;

planned exploration activities;

the adequacy of NioCorp’s financial resources;

NioCorp’s ability to secure sufficient

project financing to complete construction and commence operation of the Elk Creek Project;

NioCorp’s expectation and ability

to produce niobium, scandium, and titanium at the Elk Creek Project;

the outcome of current recovery process improvement testing,

and NioCorp’s expectation that such process improvements could lead to greater efficiencies and cost savings in the Elk

Creek Project;

Recent Corporate Events

Proposed Transaction

On September 25, 2022, the Company, GXII,

and Merger Sub, entered into the Business Combination Agreement.

Pursuant to the Business Combination Agreement, as the result

of a series of transactions, GXII will become a subsidiary of the Company (as successor by merger to the Company’s subsidiary,

ECRC), with the pre-combination public shareholders of GXII receiving Common Shares based on the Exchange Ratio of 11.1829212 Common

Shares for each GXII Class A common share held and not redeemed, and the GXII founders receiving shares in GXII (as successor by

merger to ECRC) based on the Exchange Ratio.

Pursuant to the Business Combination Agreement, after the Transaction Closing, the

GXII founders will have the right to exchange such shares for Common Shares on a one-for-one basis under certain conditions.

to the Business Combination Agreement, the Company will also assume the obligations under the issued and outstanding GXII warrants,

which will be converted into Warrants following the Transaction Closing.

The Business Combination Agreement contemplates that the

Company will undertake a reverse stock split of the Common Shares at the time of the Transaction Closing in connection with an

expected cross-listing to Nasdaq.

In addition, pursuant to the Business Combination Agreement, post-closing, the Company’s

Board of Directors will include two directors from pre-combination GXII.

The transactions contemplated by the Business Combination

Agreement and the ancillary agreements thereto are referred to collectively as the “Transaction.”

The business combination pursuant to the

Business Combination Agreement will be accounted for as a recapitalization in accordance with U.S.

Under this method of accounting,

GXII will be treated as the “acquired” company for financial reporting purposes.

Accordingly, the transaction is treated

as the equivalent of NioCorp issuing Common Shares for the net assets of GXII, accompanied by a recapitalization.

The net assets

of GXII will be stated at historical cost, with no goodwill or other intangible assets recorded.

proposed Transaction is expected to close in the first calendar quarter of 2023, subject to the satisfaction or waiver of certain

customary closing conditions contained in the Business Combination Agreement, including, among other things, (i) obtaining required

approvals of the Transaction and related matters by the respective shareholders of NioCorp and GXII, (ii) the effectiveness of

the registration statement on Form S-4 that the Company originally filed on November 7, 2022, and amended on December 22, 2022,

January 17, 2023, January 31, 2023, and February 6, 2023, and was declared effective by the SEC on February 8, 2023, (iii) receipt

of approval for listing on Nasdaq of the Common Shares to be issued in connection with the Transaction, (iv) receipt of approval

for listing on Nasdaq of the Warrants to be issued in exchange for the GXII warrants that NioCorp has agreed to assume, (v) receipt

of approval from the TSX with respect to the issuance and listing of the Common Shares issuable in connection with the Transaction,

(vi) that NioCorp and its subsidiaries (including GXII, as successor by merger to ECRC) will have at least $5.000001 million of

net tangible assets upon the consummation of the Transaction, after giving effect to any redemptions by GXII public stockholders

and after payment of underwriters’ fees or commissions,

that, at the Transaction Closing, NioCorp and its subsidiaries (including GXII, as successor by merger to ECRC) will have received

cash in an amount equal to or greater than $15.0 million, subject to certain adjustments, and (viii) the absence of any injunctions

enjoining or prohibiting the consummation of the Business Combination Agreement.

The proposed additional financings contemplated

by the LOIs will also be subject to the approval of the TSX and the Company’s shareholders.

In addition, in connection with the entry

into the Business Combination Agreement, the Company announced the signing of non-binding letters of intent for two separate financing

packages with Yorkville.

As discussed below, on January 26, 2023, the Company entered into definitive agreements with respect to

these financings.

Final proceeds will depend upon redemption

rates of current GXII shareholders at the consummation of the proposed Transaction.

In connection with the Transaction Closing,

a significant number of GXII shareholders may exercise their redemption rights.

See Part II, Item 1A, “Risk Factors—If

the Transaction is consummated, the Combined Company may not realize all or any of the anticipated benefits expected as a result

of the Transaction.”

Yorkville Financings

further discussed in Note 15 to the unaudited interim condensed consolidated financial statements as of, and for the three and

six months ended December 31, 2022, included elsewhere in the Quarterly Report on Form 10-Q, on January 26, 2023, NioCorp entered

into definitive agreements with respect to two previously announced financings with Yorkville.

The financings contemplated by

the definitive agreements include (i) up to $16.0 million aggregate principal amount of unsecured convertible debentures of NioCorp

(the “Convertible Debentures”) convertible into Common Shares and Common Share purchase warrants (the “Financing

Warrants”) entitling the holders thereof to purchase additional Common Shares (the “Yorkville Convertible Debt Financing”);

and (ii) a standby equity purchase facility pursuant to which NioCorp will have the right, but not the obligation, subject to

the conditions set out therein, to sell Common Shares to Yorkville with a maximum aggregate value of up to $65.0 million over

a period of up to 36 months (the “Yorkville Equity Facility Financing” and, together with the Yorkville Convertible

Debt Financing, the “Yorkville Financings”).

The Yorkville Financings are expected to

become effective on the date of the Transaction Closing.

NioCorp intends to use the proceeds from

the Yorkville Financings to advance its efforts to launch construction of the Elk Creek Project and move it to commercial operation,

and to satisfy the fees and expenses incurred in connection with the Transaction, if required.

Completion of the Yorkville Financings

is subject to certain conditions, including the completion of the Transaction Closing, the receipt of the approval of the TSX,

and the approval of NioCorp’s shareholders in accordance with the rules of the TSX.

Elk Creek Project Update

On October 25,

2022, the Company announced that its demonstration-scale processing plant (the “demonstration plant”), operated in

Quebec, Canada, by L3 Process Innovation (“L3”), had completed demonstrating its planned process for removing calcium

and magnesium from ore obtained from the Elk Creek Project.

This positive result is a key milestone in NioCorp’s proposed

optimization of its process flow sheet for the Elk Creek Project, which was designed by L3 and NioCorp.

Removing carbonate

minerals in this fashion is expected to reduce the size of the follow-on planned production steps and make them more efficient.

Characterization of the calcium and magnesium carbonate from the completed demonstration plant production runs has demonstrated

very low levels of impurities, and an overall 99% purity of the mixed calcium-magnesium carbonate.

On January 4,

2023, the Company announced that the demonstration plant has succeeded in obtaining a Rare Earth dissolution rate of 86-95% from

ore from the Elk Creek Project site through hydrochloric acid leaching and has achieved a loading rate of Rare Earths as high as

99% in the follow-on solvent extraction recovery step.

These relatively high rates, which were expected, point to potentially strong

rates of overall recovery of separated Rare Earth oxides, subject to additional demonstration testing over the coming weeks.

Additional solvent

extraction steps will be deployed to establish the ultimate recovery rates of potential Rare Earth products.

the Elk Creek Project’s ability to produce multiple critical metals;

the Elk Creek Project’s projected

ore production and mining operations over its expected mine life;

the completion of the demonstration plant and technical and

economic analyses on the potential addition of magnetic rare earth oxides to NioCorp’s planned product suite;

the exercise of

options to purchase additional land parcels;

the execution of contracts with engineering, procurement and construction companies;

NioCorp’s ongoing evaluation of the impact of inflation, supply chain issues and geopolitical unrest on the Elk Creek Project’s

economic model;

the impact of health epidemics, including the COVID-19 pandemic, on NioCorp’s business and the actions NioCorp

may take in response thereto;

and the creation of full time and contract construction jobs over the construction period of the

Elk Creek Project.

Forward-looking

statements are frequently, but not always, identified by words such as “expects,” “anticipates,” “believes,”

“intends,” “estimates,” “potential,” “possible,” and similar expressions, or statements

that events, conditions, or results “will,” “may,” “could,” or “should” (or the

negative and grammatical variations of any of these terms) occur or be achieved.

Any statements that express or involve discussions

with respect to predictions, expectations, beliefs, plans, projections, objectives, assumptions, or future events or performance

(often, but not always, using words or phrases such as “expects” or “does not expect,” “is expected,”

“anticipates” or “does not anticipate,” “plans,” “estimates,” or “intends,”

or stating that certain actions, events, or results “may,” “could,” “would,” “might,”

or “will” be taken, occur or be achieved) are not statements of historical fact and may be forward-looking statements.

Such forward-looking statements reflect the Company’s current views with respect to future

and are subject to certain known and unknown risks, uncertainties, and assumptions.

Many factors could cause actual results, performance,

or achievements to be materially different from any future results, performance, or achievements that may be expressed or implied

by such forward-looking statements, including, among others, risks related to the following:

NioCorp’s ability to recognize

the anticipated benefits of the Transactions, including NioCorp’s ability to access the full amount of the expected net

proceeds under the Yorkville Equity Facility Financing Agreement over the next three years;

unexpected costs related to the Transactions;

the outcome of any legal proceedings that may be instituted against NioCorp following closing of the Transactions;

ability to receive a final commitment of financing from EXIM on the anticipated timeline, on acceptable terms, or at all;

ability to continue to meet Nasdaq listing standards;

NioCorp’s ability to operate as a going concern;

risks relating to

the Common Shares, including price volatility, lack of dividend payments and dilution or the perception of the likelihood any

of the foregoing;

NioCorp’s requirement of significant additional capital;

the extent to which NioCorp’s level of

indebtedness and/or the terms contained in agreements governing NioCorp’s indebtedness or the Yorkville Equity Facility

Financing Agreement may impair NioCorp’s ability to obtain additional financing;

covenants contained in agreements with

NioCorp’s secured creditors that may affect its assets;

NioCorp’s limited operating history;

NioCorp’s history

the restatement of NioCorp’s consolidated financial statements as of and for the fiscal years ended June 30,

2022 and 2021 and the interim periods ended September 30, 2021, December 31, 2021, March 31, 2022, September 30, 2022, and December

31, 2022 and the impact of such restatement on NioCorp’s future financial statements and other financial measures;

weaknesses in NioCorp’s internal control over financial reporting, NioCorp’s efforts to remediate such material weaknesses

and the timing of remediation;

the possibility that NioCorp may qualify as a PFIC under the Code;

the potential that the Transactions

could result in NioCorp becoming subject to materially adverse U.S.

federal income tax consequences as a result of the application

of Section 7874 and related sections of the Code;

cost increases for NioCorp’s exploration and, if warranted, development

a disruption in, or failure of, NioCorp’s information technology systems, including those related to cybersecurity;

equipment and supply shortages;

current and future offtake agreements, joint ventures, and partnerships;

NioCorp’s ability

to attract qualified management;

the effects of the COVID-19 pandemic or other global health crises on NioCorp’s business

plans, financial condition and liquidity;

estimates of mineral resources and reserves;

mineral exploration and production activities;

feasibility study results;

the results of metallurgical testing;

changes in demand for and price of commodities (such as fuel

and electricity) and currencies;

competition in the mining industry;

changes or disruptions in the securities markets;

political or economic developments, including changes in federal and/or state laws that may significantly affect the mining industry;

the impacts of climate change, as well as actions taken or required by governments related to strengthening resilience in the

face of potential impacts from climate change;

the need to obtain permits and comply with laws and regulations and other regulatory

requirements;

the timing and reliability of sampling and assay data;

the possibility that actual results of work may differ from

projections/expectations or may not realize the perceived potential of NioCorp’s projects;

risks of accidents, equipment

breakdowns, and labor disputes or other unanticipated difficulties or interruptions;

the possibility of cost overruns or unanticipated

expenses in development programs;

operating or technical difficulties in connection with exploration, mining, or development activities;

the management of the water balance at the Elk Creek Project site;

land reclamation requirements related to the Elk Creek Project;

the speculative nature of mineral exploration and development, including the risks of diminishing quantities of grades of reserves

and resources;

claims on the title to NioCorp’s properties;

potential future litigation;

and NioCorp’s lack of insurance

covering all of NioCorp’s operations.

one or more of these risks or uncertainties materialize, or should underlying assumptions prove incorrect, actual results may

vary materially from those described herein.

This list is not exhaustive of the factors that may affect any of the Company’s

forward-looking statements.

Forward-looking statements are statements about the future and are inherently uncertain, and actual

achievements of the Company or other future events or conditions may differ materially from those reflected in the forward-looking

statements due to a variety of risks, uncertainties, and other factors, including without limitation those discussed under the

heading “Risk Factors” in our Annual Report on Form 10-K/A for the fiscal year ended June 30, 2022, as well as other

factors described elsewhere in this report and the Company’s other reports filed with the Securities and Exchange Commission

Company’s forward-looking statements contained in this Quarterly Report on Form 10-Q are based on the beliefs, expectations,

and opinions of management as of the date of this report.

The Company does not assume any obligation to update forward-looking

statements if circumstances or management’s beliefs, expectations, or opinions should change, except as required by law.

For the reasons set forth above, investors should not attribute undue certainty to, or place undue reliance on, forward-looking

technical and scientific information that forms the basis for the Elk Creek Project disclosure included in this Quarterly Report

on Form 10-Q has been reviewed and approved by Scott Honan, M.Sc., SME-RM, NioCorp’s Chief Operating Officer.

is a “Qualified Person” as such term is defined in National Instrument 43-101 – Standards of Disclosure for

Mineral Projects and subpart 1300 of Regulation S-K.

is developing the Elk Creek Project, located in southeast Nebraska.

The Elk Creek Project is an advanced Niobium, Scandium and

Titanium development stage property.

The Company is evaluating the potential to produce several Rare Earth byproducts from the

Elk Creek Project.

Niobium is used to produce various superalloys that are extensively used in high performance aircraft and jet

It also is used in High-Strength, Low-Alloy steel, a stronger steel used in automobiles, bridges, structural systems,

buildings, pipelines, and other applications that generally increases strength and/or reduces weight, which can result in environmental

benefits, including reduced fuel consumption and material usage and fewer air emissions.

Scandium can be combined with aluminum

to make high-performance alloys with increased strength and improved corrosion resistance.

Scandium also is a critical component

of advanced solid oxide fuel cells, an environmentally preferred technology for high-reliability, distributed electricity generation.

Titanium is a component of various superalloys and other applications that are used for aerospace applications, weapons systems,

protective armor, medical implants, and many others.

It also is used in pigments for paper, paint, and plastics.

Rare Earths are

critical to electrification and decarbonization initiatives and can be used to manufacture the strongest permanent magnets commercially

primary business strategy is to advance our Elk Creek Project to commercial production.

We are focused on obtaining additional

funds to carry out our near-term planned work programs associated with securing the project financing necessary to complete mine

development and construction of the Elk Creek Project.

Corporate Events

The GXII Transaction

On March 17, 2023 (the “Closing Date”),

the Company closed the GXII Transaction (as defined below) with GX Acquisition Corp.

II ("GXII"), pursuant to the Business

Combination Agreement, dated September 25, 2022 (the “Business Combination Agreement”), among the Company, GXII and

Big Red Merger Sub Ltd (the “Closing”).

The GXII Transaction is being accounted for as an equity raise transaction

in accordance with U.S.

At the Closing, the following transactions (collectively, the “GXII Transaction”) occurred:

a result of a series of transactions, GXII became an indirect, majority-owned subsidiary

of NioCorp and changed its name to “Elk Creek Resources Corp” (“ECRC”).

As the parent company of the merged entity, NioCorp issued 1,753,821 post-Reverse Stock Split (as defined below) Common Shares in exchange for all of the Class A shares of GXII issued and outstanding immediately prior to the Closing, including 83,770 Common Shares issued to BTIG, LLC in exchange for Class A shares of GXII that it received as partial payment for advisory services.

All of the Class B shares of GXII issued and outstanding immediately prior to the Closing (after giving effect to the surrender of certain Class B shares of GXII in accordance with the Sponsor Support Agreement, dated September 25, 2022 (the “Sponsor Support Agreement”), among GX Sponsor II LLC (the “Sponsor”), GXII, NioCorp and the other persons party thereto) were converted into 7,957,404 shares of Class B common stock of GXII (now known as ECRC) as the surviving entity of the mergers that occurred on the Closing Date as part of the GXII Transaction.

Pursuant to the Business Combination Agreement, the Sponsor Support Agreement and the Exchange Agreement, dated as of March 17, 2023 (as amended, supplemented or otherwise modified, the “Exchange Agreement”), by and among NioCorp, ECRC and the Sponsor, after the Closing, the shares of Class B common stock of ECRC are exchangeable into Common Shares on a one-for-one basis, subject to certain equitable adjustments, under certain conditions.

Of the issued and outstanding shares of Class B common stock of ECRC, 4,565,808 shares (the “Vested Shares”) were vested as of the Closing Date and are exchangeable at any time, and from time to time, until the tenth anniversary of the Closing Date (the “Ten-Year Anniversary”) and 3,391,596 shares (the “Earnout Shares”) are exchangeable until the Ten-Year Anniversary, subject to certain vesting conditions.

See Note 9 for additional information regarding the Class B common stock of ECRC.

NioCorp assumed GXII’s obligations under the agreement governing the GXII share purchase warrants (the “GXII Warrants”) and issued an aggregate of 15,666,626 warrants (the “NioCorp Assumed Warrants”) to purchase up to an aggregate of 17,519,864 Common Shares.

The NioCorp Assumed Warrants issued at the Closing consisted of (a) 9,999,959 public NioCorp Assumed Warrants (the “Public Warrants”) that were issued in respect of the GXII Warrants that were publicly traded prior to the Closing and (b) 5,666,667 NioCorp Assumed Warrants (the “Private Warrants”) that were issued to the Sponsor in respect of the GXII Warrants that it held prior to the Closing, which NioCorp Assumed Warrants were subsequently distributed by the Sponsor to its members in connection with the Closing.

See Note 10b for additional information regarding the NioCorp Assumed Warrants.

On the Closing Date, the Company also effected

a reverse stock split (the “Reverse Stock Split”) on the basis of one (1) post-Reverse Stock Split Common Share for

every ten (10) pre-Reverse Stock Split Common Shares issued and outstanding, with any fractional shares resulting from the Reverse

Stock Split rounded down to the nearest whole share.

The transactions contemplated by the Business

Combination Agreement, including the GXII Transaction, the Yorkville Convertible Debt Facility Financing (as defined below),

the Yorkville Equity Facility Financing (as defined below) and the Reverse Stock Split, are referred to, collectively, as the

“Transactions.”

The number of Common Shares issued and outstanding immediately following the consummation of the Transactions were as follows:

Common Shares

Legacy NioCorp Shareholders

Former GXII Class A Shareholders 1

Total Common Shares Outstanding Upon Completion of Transactions

– Includes 83,770 Common Shares issued to BTIG, LLC in exchange for Class A shares of GXII that it received

as partial payment for advisory services.

Represents Commitment Shares (as defined below) issued under the Yorkville Equity Facility Financing Agreement.

After consideration of GXII expenses

incurred in connection with the Transactions, the Company acquired net cash of $2,168, and assumed net liabilities of

approximately $392, Private Warrant liabilities of $3,848, and the Earnout Shares liability of $13,195.

The Company incurred

expenses related to the Transactions of $6,309, all of which were recorded as other operating expenses.

addition, in connection with the Transactions, the Common Shares and the NioCorp Assumed Warrants were listed for trading on The

Nasdaq Stock Market LLC (“Nasdaq”).

The Common Shares and the NioCorp Assumed Warrants began trading on The Nasdaq

Global Market and The Nasdaq Capital Market, respectively, on March 21, 2023, under the symbols “NB” and “NIOBW,”

respectively.

The Common Shares continued to trade on the Toronto Stock Exchange (“TSX”) under the symbol “NB,”

and began trading on the TSX on a post-Reverse Stock Split basis on March 21, 2023.

The Common Shares ceased being quoted on the

OTC Markets in connection with the commencement of trading on The Nasdaq Global Market.

In connection with the entry into the Business

Combination Agreement, the Company announced the signing of non-binding letters of intent for two separate financing packages with

Yorkville Advisors Global, LP.

On January 26, 2023, the Company entered into definitive agreements with respect to these financings,

including a Securities Purchase Agreement, dated January 26, 2023 (as amended the “Yorkville Convertible Debt Financing Agreement”),

between the Company and YA II PN, Ltd., an investment fund managed by Yorkville Advisors Global, LP (together with YA II PN, Ltd.,

“Yorkville”), and a Standby Equity Purchase Agreement, dated January 26, 2023 (the “Yorkville Equity Facility

Financing Agreement”), between the Company and Yorkville.

Pursuant to the Yorkville Equity Facility Financing Agreement,

Yorkville has committed to purchase up to $65.0 million of our Common Shares (the “Commitment Amount”), at our direction

from time to time for a period commencing upon the Closing Date and ending on the earliest of (i) the first day of the month next

following the 36-month anniversary of the Closing, (ii) the date on which Yorkville shall have made payment of the full Commitment

Amount and (iii) the date that the Yorkville Equity Facility Financing Agreement otherwise terminates in accordance with its terms

(the “Commitment Period”), subject to certain limitations and the satisfaction of the conditions in the Yorkville Equity

Facility Financing Agreement.

Pursuant to the terms of the Yorkville Equity Facility Financing Agreement, we issued 81,213 of our

Common Shares (the “Commitment Shares”) to Yorkville as consideration for its irrevocable commitment to purchase Common

Shares under the Yorkville Equity Facility Financing Agreement.

Additionally, we are required to pay Yorkville an aggregate fee

of $1,500,000 in cash (the “Cash Fee”), including $500,000 that we paid on the Closing Date and the remainder that

we will pay in installments over a 12-month period following the Closing Date, provided that, we will have the right to prepay

without penalty all or part of the remaining installments of the Cash Fee at any time.

The transactions contemplated by the Yorkville

Equity Facility Financing Agreement are collectively referred to as the “Yorkville Equity Facility Financing.”

to the Yorkville Convertible Debt Financing Agreement, at the Closing, Yorkville advanced a total amount of $15.36 million to

NioCorp in consideration of the issuance by NioCorp to Yorkville of (i) $16.0 million aggregate principal amount of unsecured

convertible debentures (the “Convertible Debentures”) and (ii) Common Share purchase warrants, exercisable for up

to 1,789,267 Common Shares for cash or, if at any time there is no effective registration statement registering, or no current

prospectus available for, the resale of the underlying Common Shares, on a cashless basis, at the option of the holder, at a price

per Common Share of approximately $8.9422, subject to adjustment to give effect to any stock dividend, stock split, reverse stock

split or similar transaction (the “Financing Warrants”).

See Notes 8 and 10 for descriptions of certain terms of the

Convertible Debentures and the Financing Warrants.

The transactions contemplated by the Yorkville Convertible Debt Financing Agreement

are collectively referred to as the “Yorkville Convertible Debt Financing.”

Direct Offering

April 28, 2023, the Company issued and sold 314,465 Common Shares in a registered direct offering at a price of $6.36 per share.

Net proceeds to the Company from the offering were approximately $1.8 million.

NioCorp intends to use the net proceeds from the

offering for working capital and general corporate purposes, including to advance its efforts to launch construction of the Elk

Creek Project and move it to commercial operation.

Creek Project Update

October 25, 2022, the Company announced that its demonstration-scale processing plant (the “demonstration plant”),

operated in Quebec, Canada, by L3 Process Innovation (“L3”), had completed demonstrating its planned process for removing

calcium and magnesium from ore obtained from the Elk Creek Project.

This positive result is a key milestone in NioCorp’s

proposed optimization of its process flow sheet for the Elk Creek Project, which was designed by L3 and NioCorp.

carbonate minerals in this fashion is expected to reduce the size of the follow-on planned production steps and make them more

Characterization of the calcium and magnesium carbonate from the completed demonstration plant production runs has

demonstrated very low levels of impurities, and an overall 99% purity of the mixed calcium-magnesium carbonate.

January 4, 2023, the Company announced that the demonstration plant has succeeded in obtaining a Rare Earth dissolution rate of

86-95% from ore from the Elk Creek Project site through hydrochloric acid leaching and has achieved a loading rate of Rare Earths

as high as 99% in the follow-on solvent extraction recovery step.

These relatively high rates, which were expected, point to potentially

strong rates of overall recovery of separated Rare Earth oxides, subject to additional demonstration testing over the coming weeks.

solvent extraction steps will be deployed to establish the ultimate recovery rates of potential Rare Earth products.

The demonstration

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iron and a very small amount of nickel.

Given the success of this initial separation step, L3 and NioCorp expect

that losses in the additional solvent extraction steps would be low.

February 6, 2023, the Company announced that overall recoveries for praseodymium oxide, neodymium oxide, terbium oxide, and

dysprosium oxide are likely to be greater than 92% and meet commercial purity specifications for magnetic rare earth oxides.

results are in line with bench- and pilot-scale testing of L3’s rare earth recovery system, as well as hydrometallurgical

performance models that have been run on the rare earth recovery process upon which the demonstration plant is based.

NioCorp is currently

focused on demonstrating its ability to recover three high-purity Rare Earth products:

(1) neodymium-praseodymium (“NdPr”)

oxide, which is the principal component of neodymium-iron-boron (“NdFeB”) permanent Rare Earth magnets, (2) Dy oxide,

and (3) Tb oxide.

Both Dy and Tb oxides are critical to the type of powerful NdFeB magnets used in the traction motors of electric

The Demonstration Plant is also expected to deliver updated metallurgical recoveries for niobium, scandium and titanium

and expects to complete operations in the first calendar quarter of 2023.

Other Activities

Our long-term financing efforts continued

during the quarter ended December 31, 2022, including the proposed Transaction, discussed above.

As funds become available through

the Company’s fundraising efforts, we expect to undertake the following activities:

Continuation of the Company’s efforts to secure federal, state, and local permits;

Continued evaluation of the potential to produce Rare Earth products;

Negotiation and completion of offtake agreements for the remaining uncommitted production from the project;

Negotiation and completion of engineering, procurement, and construction agreements;

Completion of the final detailed engineering for the underground portion of the Elk Creek Project;

Initiation and completion of the final detailed engineering for surface project facilities;

Construction of natural gas and electrical infrastructure under existing agreements to serve the Elk Creek Project site;

Completion of water supply agreements and related infrastructure to deliver fresh water to the project site;

Initiation of revised mine groundwater investigation and control activities;

Land clearing operations intended to prepare property owned by ECRC for the commencement of project construction;

Initiation of efforts to satisfy conditions of Johnson County’s Special Use Permit, including road upgrades and the provision of additional law enforcement during the construction period;

Initiation of long-lead equipment procurement activities;

Completion of the operations of the demonstration plant to address process recommendations contained in the NI 43-101 technical report for the Elk Creek Project filed on SEDAR on May 29, 2019 and to quantify REE metallurgical performance.

Financial and Operating Results

The Company has no revenues from mining

Operating expenses incurred related primarily to performing exploration activities, as well as the activities necessary

to support corporate and shareholder duties, and are detailed in the following table.

For the Three Months

Ended December 31,

For the Six Months

Ended December 31,

Given the success of this initial separation step, L3 and NioCorp

expect that losses in the additional solvent extraction steps would be low.

February 6, 2023, the Company announced that overall recoveries for praseodymium oxide, neodymium oxide, terbium oxide, and dysprosium

oxide are likely to be greater than 92% and meet commercial purity specifications for magnetic rare earth oxides.

These results

are in line with bench- and pilot-scale testing of L3’s rare earth recovery system, as well as hydrometallurgical performance

models that have been run on the rare earth recovery process upon which the demonstration plant is based.

February 20, 2023, the Company announced that it had executed a contract with Zachry Group (“Zachry“) to develop a

cost for the surface facilities associated with NioCorp’s Elk Creek Project.

The contract represents the first phase of

engineering, procurement, and construction (“EPC”) contracting for the Elk Creek Project.

NioCorp had previously selected

Zachry as its EPC firm for the Elk Creek Project’s surface facilities.

April 4, 2023, the Company announced a process breakthrough in niobium and titanium recovery achieved at the demonstration plant.

The breakthrough points to a potentially more efficient way to process niobium and titanium into higher-purity products, which

may in turn open up new markets for the Elk Creek Project’s planned products.

The demonstration plant is also expected to

deliver updated metallurgical recoveries for niobium, scandium and titanium and expects to complete operations in the second calendar

quarter of 2023.

long-term financing efforts continued during the quarter ended March 31, 2023, including consummating the Transactions, as discussed

In addition, on March 6, 2023, the Company announced the receipt of a Letter of Interest from the EXIM for potential debt

financing of up to $800 million through EXIM’s “Make More In America” initiative to fund a portion of the project

costs of the Elk Creek Project.

A project finance letter of interest from EXIM represents only a preliminary step in the formal

EXIM application process, and the Letter of Interest states that the communication “does not represent a financing commitment”

and “is not an explicit indication of the financial or commercial viability of a transaction.” NioCorp expects to

submit an application to EXIM to begin the first phase of the underwriting process (“Phase I”) as soon as possible.

As stated in the Letter of Interest, “Upon receipt of NioCorp’s application for financing, EXIM will conduct all requisite

due diligence necessary to determine if a Final Commitment may be issued for this transaction.” The process from submission

of a Phase I application to a final commitment of financing by EXIM, if any, is expected to take approximately six to nine months

and is subject to a number of risks and uncertainties.

As explained in the Letter of Interest, “Any final commitment will

be dependent on meeting EXIM’s underwriting criteria, authorization process, and finalization and satisfaction of terms

and conditions.

All Final Commitments must be in compliance with EXIM policies as well as program, legal, and eligibility requirements.”

The debt financing is subject to the satisfactory completion of due diligence, the negotiation and settlement of final terms,

and the negotiation of definitive documentation.

There can be no assurance that the debt financing will be completed on the terms

as described above or at all.

funds become available through the Company’s fundraising efforts, we expect to undertake the following activities:

of the Company’s efforts to secure federal, state, and local permits;

Continued evaluation

of the potential to produce Rare Earth products;

Negotiation and

completion of offtake agreements for the remaining uncommitted production from the project;

Negotiation and

completion of engineering, procurement, and construction agreements;

Completion of the

final detailed engineering for the underground portion of the Elk Creek Project;

Initiation and completion

of the final detailed engineering for surface project facilities;

Construction of

natural gas and electrical infrastructure under existing agreements to serve the Elk Creek Project site;

Completion of water

supply agreements and related infrastructure to deliver fresh water to the project site;

Initiation of revised

mine groundwater investigation and control activities;

Land clearing operations

intended to prepare property owned by ECRC for the commencement of project construction;

Initiation of efforts

to satisfy conditions of Johnson County’s Special Use Permit, including road upgrades and the provision of additional

law enforcement during the construction period;

Initiation of long-lead

equipment procurement activities;

Completion of the

operations of the demonstration plant.

and Operating Results

Company has no revenues from mining operations.

Operating expenses incurred related primarily to costs incurred in connection

with the Transactions, as well as performing exploration activities and the activities necessary to support corporate and shareholder

duties, and are detailed in the following table.

For the Three Months Ended March 31,

For the Nine Months Ended March 31,

Operating expenses

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Total operating expenses

Foreign exchange loss

Change in fair value of Earnout Shares liability

Change in fair value of warrant liabilities

Debt extinguishment

Foreign exchange (gain) loss

Interest expense

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Income tax benefit

Six-month period ended December 31,

2022 compared to the six-month period ended December 31, 2021

Significant items affecting operating expenses

are noted below:

Employee-related costs decreased

in 2022 as compared to 2021, primarily due to the timing of employee stock option grants.

These costs decreased in 2022 as compared

to 2021 due to stock options to purchase Common Shares (“Options”) issued in 2021, which were fully vested and expensed

on the grant date.

Exploration expenditures

increased in 2022 as compared to 2021, primarily due to the timing of demonstration plant development, start-up, and operational

costs incurred in 2022, as well as costs related to the completion and filing of the Technical Report Summary based on the Company’s

2022 Feasibility Study for the Elk Creek Project, which was filed with the SEC on September 6, 2022.

Loss attributable to noncontrolling interest

Net loss attributable to the Company

period ended March 31, 2023 compared to the nine-month period ended March 31, 2022

items affecting operating expenses are noted below:

Other operating expenses

include investor relations, general office expenditures, equity offering and proxy expenditures, board-related expenditures,

and other miscellaneous costs.

These costs decreased in 2022 as compared to 2021, primarily due to director Options issued in 2021,

which were fully vested and expensed on the grant date.

This reduction in costs associated with director Options was partially

offset by increased financial advisory fees and investor relations fees associated with our ongoing financing efforts.

Other significant items impacting the change

in the Company’s net loss are noted below :

Foreign exchange loss

is primarily due to changes in the U.S.

dollar against the Canadian dollar and reflects the timing of foreign currency transactions,

primarily U.S.

dollar-based related party loans, and subsequent changes in exchange rates.

The decline in foreign exchange loss

during 2022 as compared 2021 is due to a declining U.S.

dollar-based debt balance, partially offset by increased foreign exchange

rates in 2022.

include costs incurred in connection with the Transactions, including direct transaction expenses, and the fair value of warrant

and Earnout Shares liabilities assumed, as well as costs related to investor relations, general office expenditures, equity offering

and proxy expenditures, board-related expenditures, and other miscellaneous costs.

These costs increased in 2023 as compared to

2022 primarily due to the costs incurred in connection with the Transactions, which closed on March 17, 2023.

A summary of these

costs is presented below:

Gross cash proceeds, net of transaction costs incurred by GXII

Net liabilities assumed

Private Warrants assumed at fair value

Earnout Shares assumed at fair value

Transaction costs expensed

Yorkville Equity Facility Financing Agreement expenses

Transaction related losses incurred

Employee-related

costs increased in 2023 as compared to 2022, primarily due to the timing of board-authorized employee award payments, partially

offset by a decrease in share-based compensation expense and the impact of reduced headcount.

Share based compensation costs increased

in 2023 as compared to 2022 due to the impact of an increased Common Share price offset slightly by a decrease in the number of

Options issued.

Options granted in both 2023 and 2022 were fully vested and expensed on the grant date.

expenditures increased in 2023 as compared to 2022, primarily due to the timing of demonstration plant development, start-up,

and operational costs incurred in 2023, as well as costs related to the completion and filing of the Technical Report Summary

based on the Company’s 2022 Feasibility Study for the Elk Creek Project, which was filed with the SEC on September 6, 2022.

significant items impacting the change in the Company’s net loss are noted below :

Change in fair value of Earnout

Shares liability represents the change in fair value related to the Earnout Shares between the Closing Date and the end of

the quarter, based on the results of Monte Carlo financial modeling.

Change in fair value of warrant

liability represents the change in fair value related to the additional Warrants (the “Contingent Consent Warrants”)

that the Company agreed to issue to Lind Global Asset Management III, LLC (“Lind”) upon certain conditions in connection

with the Waiver and Consent Agreement, dated September 25, 2022, between the Company and Lind (the “Lind Consent”),

as discussed in Note 8, as well as the change in the fair value of the Private Warrants based primarily on the impacts of a lower

closing Common Share price, which increases the probability of these Contingent Consent Warrants being issued on the 18-month anniversary.

Loss on debt extinguishment

represents the loss incurred under Accounting Standards Codification (“ASC”) Topic 470, Debt, related to the convertible

security issued to Lind (the “Lind III Convertible Security”) pursuant to the Convertible Security Funding Agreement,

dated February 26, 2021, as amended by Amendment #1 to the Convertible Security Funding Agreement, dated December 2, 2021, between

the Company and Lind), as discussed in Note 3 to the interim condensed consolidated financial statements.

Interest expense decreased

in 2022 as compared to 2021 due to the impacts of conversions on the outstanding balance of the convertible security (the “Lind

III Convertible Security”) issued to Lind Global Asset Management III, LLC (“Lind”).

Three-month period ended December 31,

2022 compared to the three-month period ended December 31, 2021

Overall, the decrease in net loss for the

three-month period ended December 31, 2022, as compared to the same period in 2021, is primarily the result of the same factors

underlying the six-month changes in expense categories as discussed above.

Liquidity and Capital Resources

We have no revenue generating operations

from which we can internally generate funds.

To date, our ongoing operations have been financed by the sale of our equity securities

by way of private placements, convertible securities issuances, the exercise of incentive Options and Warrants, and related party

As of December 31, 2022, the Company had

cash of $0.4 million and a working capital deficit of $6.6 million, compared to cash of $5.3 million and working capital surplus

of $0.6 million on June 30, 2022.

We expect that the Company will operate

at a loss for the foreseeable future.

The Company’s current planned cash needs are approximately $13.5 million until June

In addition to outstanding accounts payable and short-term liabilities, our average monthly planned expenditures are

approximately $1,165 per month where approximately $405 is for corporate overhead and estimated costs related to securing financing

necessary for advancement of the Elk Creek Project.

Approximately $760 per month is planned for expenditures relating to the advancement

of Elk Creek Project by NioCorp’s wholly owned subsidiary, ECRC.

The Company’s ability to continue operations and fund

our current work plan is dependent on management’s ability to secure additional financing.

in 2023 as compared to 2022 due to the impacts of conversions on the outstanding balance of the Lind III Convertible Security during

2022, as well as the impact of debt extinguishment accounting as discussed in Note 3.

Loss attributable to noncontrolling

interest represents the portion of net loss in ECRC attributable to the Vested Shares, which are not owned by the Company.

period ended March 31, 2023 compared to the three-month period ended March 31, 2022

the increase in net loss for the three-month period ended March 31, 2023, as compared to the same period in 2022, is primarily

the result of the same factors underlying the nine-month changes in expense categories as discussed above.

The increase in employee-related

costs for the three-month period ended March 31, 2023 is due to the timing of Options issued to employees.

and Capital Resources

have no revenue generating operations from which we can internally generate funds.

To date, our ongoing operations have been financed

by the sale of our equity securities by way of private placements, convertible securities issuances, the exercise of incentive

Options and Warrants, and related party loans.

With respect to currently outstanding Options and Warrants, we believe that exercise

of these instruments, and cash proceeds from such exercises, will not occur unless and until the market price for our Common Shares

equals or exceeds the related exercise price of each instrument.

In connection with the Closing of the Transactions,

the Company received net cash proceeds of $8.7 million, as follows:

Net cash received from GXII trust account, after payment of direct and incremental transaction costs incurred

Net proceeds from the Yorkville Convertible Debt Financing Agreement

Net cash costs incurred in connection with Yorkville Equity Facility Financing Agreement

NioCorp direct and incremental transaction costs

Net proceeds from Transactions

The Transactions delivered to NioCorp

several important benefits, including a ready pathway to an up-listing to the Nasdaq, which is expected to allow additional institutional

firms to invest in the Company for the first time.

Further, we believe it has given NioCorp and the Elk Creek Project a much higher

profile among institutional investors evaluating projects in the critical materials space.

Many new investors, including institutional

and other large investment funds, are now anticipated to look more closely at NioCorp, particularly since the Common Shares and

the Public Warrants are now trading on Nasdaq.

The Yorkville Convertible Debt Financing

has provided, and the Yorkville Equity Facility Financing is expected to provide, near-term and longer-term access to capital.

The ability of the Company to draw down on the Yorkville Equity Facility Financing Agreement, at its discretion, is subject to

certain limitations and the satisfaction of certain conditions.

If and when available, the Yorkville Equity Facility Financing

Agreement provides an opportunity to actively manage the cash needs of the Company more closely.

Historically, cash has generally

been available to the Company through private placements of equity for which the timing did not always coincide with the Company’s

The Company may utilize the Yorkville Equity Facility Financing Agreement to potentially generate funds at a time

when they are in need.

Alternatively, the Company can also utilize the Yorkville Equity Facility Financing Agreement for opportunistic

of March 31, 2023, the Company had cash of $7.1 million and working capital of $2.6 million, compared to cash of $5.3 million

and working capital of $0.6 million on June 30, 2022.

April 28, 2023, the Company issued and sold 314,465 Common Shares in a registered direct offering at a price of $6.36 per share.

Net proceeds to the Company from the offering were approximately $1.8 million.

NioCorp intends to use the net proceeds from the

offering for working capital and general corporate purposes, including to advance its efforts to launch construction of the Elk

Creek Project and move it to commercial operation.

expect that the Company will operate at a loss for the foreseeable future.

The Company’s current planned cash needs are

approximately $7.7 million until June 30, 2023.

In addition to outstanding accounts payable and short-term liabilities, our average

monthly planned expenditures are approximately $1,136 per month where approximately $610 is for corporate overhead and estimated

costs related to securing financing necessary for advancement of the Elk Creek Project.

Approximately $526 per month is planned

for expenditures relating to the advancement of Elk Creek Project by NioCorp’s majority-owned subsidiary, ECRC.

The Company’s

ability to continue operations and fund our current work plan is dependent on management’s ability to secure additional

The Company anticipates that it does not

have sufficient cash to continue to fund basic operations for the next twelve months, and additional funds totaling $13.5 million

to $15.5 million are likely to be necessary to continue advancing the project in the areas of financing, permitting, and detailed

Management is actively pursuing such additional sources of debt and equity financing, and while it has been successful

in doing so in the past, there can be no assurance it will be able to do so in the future.

Elk Creek property lease commitments are

$12 until June 30, 2023.

To maintain our currently held properties and fund our currently anticipated general and administrative

costs and planned exploration and development activities at the Elk Creek Project for the fiscal year ending June 30, 2023, the

Company will likely require additional financing during the current fiscal year.

Should such financing not be available in that

timeframe, we will be required to reduce our activities and will not be able to carry out all our presently planned activities

at the Elk Creek Project.

On September 25, 2022, the Company, GXII

and Merger Sub entered into the Business Combination Agreement.

The NioCorp Board of Directors considered a number of factors as

generally supporting its decision to enter into the Business Combination Agreement, including, but not limited to, the following

material factors:

Anticipated Acceleration of Financing Efforts .

The Transaction has the potential to (1) provide NioCorp with up to $285.0 million in net cash proceeds at the consummation of the Transaction, depending upon the amount of redemptions by GXII public stockholders, and up to an additional $81.0 million over the next three years (as further discussed below), depending on the consummation of other additional financing arrangements that NioCorp and GXII intend to pursue prior to and following the expected closing of the Transaction and (2) significantly accelerate NioCorp’s efforts to obtain the required Elk Creek Project financing by increasing exposure to institutional investors looking to make strategic investments in critical minerals plays that are crucial to the world’s clean energy transition;

Yorkville Term Sheets.

The signing of non-binding LOIs for two separate financing packages with Yorkville.

The financings

contemplated by the LOIs include $16.0 million in convertible debentures that are expected to be funded at the closing of

the Transaction, and subject to certain limitations can be repaid by NioCorp in either cash or Common Shares, and a standby

equity purchase facility pursuant to which NioCorp will have the ability to require Yorkville, subject to the conditions set

out in the definitive agreements, to purchase up to $65.0 million of Common Shares;

Anticipated Benefits of Nasdaq Listing .

A listing on Nasdaq, which is an established national exchange in the United States, would provide broader access to capital and financing alternatives and would otherwise enhance NioCorp’s public profile;

Minimum Cash Condition .

The consummation of the Transaction is subject to the satisfaction or waiver of certain closing conditions contained in the Business Combination Agreement, including, among other things, that, at the closing, NioCorp and its subsidiaries (including GXII, as successor by merger to ECRC) will have received cash in an amount equal to or greater than $15.0 million, subject to certain adjustments.

The NioCorp Board of Directors also considered

a variety of uncertainties and risks and other potentially negative factors concerning the Transaction, including, but not limited

to, the following:

Risks of Failure to Complete the Transaction .

The risks that:

the Transaction may not be completed despite the parties’ efforts, including the possibility that the conditions to the parties’ obligations to complete the Transaction (which include certain conditions that are not within the control of the parties to the Business Combination Agreement) may not be satisfied or that completion of the Transaction may be unduly delayed, and any resulting adverse impacts on NioCorp, its business and the trading price of Common Shares;

the circumstances under which the Business Combination Agreement could be terminated and the impact of such termination, including the requirement that NioCorp must pay GXII (1) a Base Termination Fee of $15.0 million if it terminates the Business Combination Agreement in order to enter into an agreement providing for a Superior Proposal (as defined in the Business Combination Agreement), for a change of recommendation of the NioCorp Board, or a material breach of certain of NioCorp’s covenants relating to soliciting acquisition proposals or (2) an Intentional Breach Termination Fee of $25.0 million if GXII terminates the Business Combination Agreement as a result of a willful and material breach by NioCorp or as a result of NioCorp’s failure to consummate the closing of the Transaction within five business days after all the conditions to closing have been satisfied;

if GXII is entitled to the Base Termination Fee or the Intentional Breach Termination Fee upon termination of the Business Combination Agreement, NioCorp is also required to pay all documented and reasonable out-of-pocket expenses paid or payable by GXII and its sponsor in connection with the Business Combination Agreement and the Transaction, not to exceed $5.0 million;

the substantial costs to be incurred in connection with the Transaction, including those incurred regardless of whether the Transaction are completed;

Risks Relating to the Benefits of the Transaction.

The risks of:

not realizing all the anticipated benefits expected as a result of the Transaction, including the anticipated acceleration of its financing efforts and the benefits of the expected Nasdaq listing, and that general economic and market conditions outside the control of the parties to the Business Combination Agreement could deteriorate, any of which could result in NioCorp being unable to achieve the financing necessary to advance, complete construction and commence operation of the Elk Creek Project;

the substantial costs to be incurred in connection with the Transaction, including those incurred regardless of whether the anticipated benefits of the Transaction are realized;

Restrictions on the Conduct of Business .

The Business Combination Agreement places certain restrictions on the conduct of the NioCorp business prior to the consummation of the Transaction and other alternatives reasonably available to NioCorp if it did not pursue the Transaction, including continuing to pursue alternative financing arrangements.

Except for the Yorkville Financings discussed

in “Management’s Discussion and Analysis of Financial Condition and Results of Operations” under the heading

“ Recent Corporate Events ,” we currently have no further funding commitments or arrangements for additional financing

at this time, other than the potential exercise of Options and Warrants, and there is no assurance that we will be able to obtain

any such additional financing on acceptable terms, if at all.

The Yorkville Convertible Debt Financing Agreement also contains

certain covenants that, among other things, limit NioCorp’s ability to use the proceeds from the Yorkville Convertible Debt

Financing to repay related party debt or to enter into any variable rate transaction, including issuances of equity or debt securities

that are convertible into Common Shares at variable rates and any equity line of credit, ATM agreement or other continuous offering

of Common Shares, other than with Yorkville, subject to certain exceptions.

Notwithstanding the restrictions set forth in the Business

Combination Agreement and the Yorkville Convertible Debt Financing Agreement, there is

significant uncertainty that we would be

able to secure any additional financing in the current equity or debt markets.

have sufficient cash on hand to continue to fund basic operations for the next twelve months, and additional funds totaling $3.0

million to $5.0 million, in addition to the $1.8 million raised from the Registered Direct Offering completed on April 28, 2023,

are likely to be necessary to continue advancing the project in the areas of financing, permitting, and detailed engineering.

the Yorkville Equity Facility Financing Agreement may provide the Company with access to additional capital, the Company may require

additional capital to meet its cash needs.

Management is actively pursuing such additional sources of debt and equity financing,

and while it has been successful in doing so in the past, there can be no assurance it will be able to do so in the future.

Creek property lease commitments are nil until June 30, 2023.

To maintain our currently held properties and fund our currently

anticipated general and administrative costs and planned exploration and development activities at the Elk Creek Project for the

fiscal year ending June 30, 2023, the Company will likely require additional financing during the current fiscal year.

such financing not be available in that timeframe, we will be required to reduce our activities and will not be able to carry

out all our presently planned activities at the Elk Creek Project.

Except for potential funding under the

Yorkville Equity Facility Financing, discussed above, and the potential exercise of Options and Warrants, we currently have no

further funding commitments or arrangements for additional financing at this time, and there is no assurance that we will be able

to obtain any such additional financing on acceptable terms, if at all.

Pursuant to the Exchange Agreement, NioCorp is restricted

from issuing equity or equity-linked securities (other than Common Shares) or any preferred equity or non-voting equity if such

issuance would adversely impact the rights of the holders of the shares of Class B common stock of ECRC, without the consent of

the holders of a majority of the shares of Class B common stock of ECRC.

The Yorkville Convertible Debt Financing Agreement also

contains certain covenants that, among other things, limit NioCorp’s ability to use the proceeds from the Yorkville Convertible

Debt Financing to repay related party debt or to enter into any variable rate transaction, including issuances of equity or debt

securities that are convertible into Common Shares at variable rates and any equity line of credit, ATM agreement or other continuous

offering of Common Shares, other than with Yorkville, subject to certain exceptions.

Notwithstanding the restrictions set forth

in the Exchange Agreement and the Yorkville Convertible Debt Financing Agreement, there is significant uncertainty that we would

be able to secure any additional financing in the current equity or debt markets.

The quantity of funds to be raised and the terms

of any proposed equity or debt financing that may be undertaken will be negotiated by management as opportunities to raise funds

In addition to the proposed Transaction and Yorkville Financings, and subject to receipt of the consent of GXII as may be

required pursuant to the Business Combination Agreement, management may pursue funding sources of both debt and equity financing,

including but not limited to the issuance of equity securities in the form of Common Shares, Warrants, subscription receipts, or

any combination thereof in units of the Company pursuant to private placements to accredited investors or pursuant to public offerings

in the form of underwritten/brokered offerings, registered direct offerings, or other forms of equity financing and public or private

issuances of debt securities including secured and unsecured convertible debt instruments or secured debt project financing.

does not currently know the terms pursuant to which such financings may be completed in the future, but any such financings will

be negotiated at arm’s length.

Future financings involving the issuance of equity securities or derivatives thereof will

likely be completed at a discount to the then-current market price of the Company’s securities and will likely be dilutive

to current shareholders.

In addition, we could raise funds through the sale of interests in our mineral properties, although current

market conditions and the impacts of the COVID-19 pandemic and other recent worldwide events have substantially reduced the number

of potential buyers/acquirers of any such interests.

However, we cannot provide any assurances that we will be able to be successful

in raising such funds.

Based on the conditions

described within, management has concluded and the audit opinion and notes that accompany our financial statements for the year

ended June 30, 2022, disclose that substantial doubt exists as to our ability to continue in business.

The financial statements

included in this Quarterly Report on Form 10-Q have been prepared under the assumption that we will continue as a going concern.

Management may pursue funding sources of both debt and equity financing, including but not limited to the issuance of equity

securities in the form of Common Shares, Warrants, subscription receipts, or any combination thereof in units of the Company pursuant

to private placements to accredited investors or pursuant to public offerings in the form of underwritten/brokered offerings, registered

direct offerings, or other forms of equity financing and public or private issuances of debt securities including secured and unsecured

convertible debt instruments or secured debt project financing.

Management does not currently know the terms pursuant to which

such financings may be completed in the future, but any such financings will be negotiated at arm’s length.

Future financings

involving the issuance of equity securities or derivatives thereof will likely be completed at a discount to the then-current market

price of the Company’s securities and will likely be dilutive to

current shareholders.

In addition, we could raise funds through the sale of interests in our mineral

properties, although current market conditions and other recent worldwide events have substantially reduced the number of potential

buyers/acquirers of any such interests.

However, we cannot provide any assurances that we will be able to be successful in raising

on the conditions described within, management has concluded and the audit opinion and notes that accompany our financial statements

for the year ended June 30, 2022, disclose that substantial doubt exists as to our ability to continue in business.

The financial

statements included in this Quarterly Report on Form 10-Q have been prepared under the assumption that we will continue as a going

We are a development stage issuer and we have incurred losses since our inception.

We may not have sufficient cash to fund normal

operations and meet debt obligations for the next twelve months without deferring payment on certain current liabilities and raising

additional funds.

The COVID-19 pandemic and other recent worldwide events have created general global economic uncertainty as well

as uncertainty in capital markets, supply chain disruptions, increased interest rates, and the potential for geographic recessions.

We may not have sufficient cash to

fund normal operations and meet debt obligations for the next twelve months without deferring payment on certain current liabilities

and raising additional funds.

Recent worldwide events have created general global economic uncertainty as well as uncertainty

in capital markets, supply chain disruptions, increased interest rates and inflation, and the potential for geographic recessions.

During fiscal year 2022 and continuing into fiscal year 2023, these events continued to create uncertainty with respect to overall

4 unchanged sentences

raise substantial doubt as to our ability to continue as a going concern.

We have no exposure to any asset-backed

commercial paper.

Other than cash held by our subsidiaries for their immediate operating needs in Colorado and Nebraska, all of

our cash reserves are on deposit with major U.S.

have no exposure to any asset-backed commercial paper.

Other than cash held by our subsidiaries for their immediate operating

needs in Colorado and Nebraska, all of our cash reserves are on deposit with major U.S.

and Canadian chartered banks.

We do not believe that the credit, liquidity, or

market risks with respect thereto have increased as a result of the current market conditions.

However, in order to achieve greater

security for the preservation of our capital, we have, of necessity, been required to accept lower rates of interest, which has

also lowered our potential interest income.

Operating Activities

During the six months ended December 31,

believe that the credit, liquidity, or market risks with respect thereto have increased as a result of the current market conditions.

However, in order to achieve greater security for the preservation of our capital, we have, of necessity, been required to accept

lower rates of interest, which has also lowered our potential interest income.

During the nine months ended March 31,

2023, the Company’s operating activities consumed $11.5 million of cash (2022:

$4.4 million).

The cash used in operating activities

for the six months ended December 31, 2022, reflects the Company’s funding of losses of $4.8 million, partially offset by

the accretion of convertible debt and other non-cash transactions.

Overall, operational outflows during the six months ended December

31, 2022, increased from the corresponding period of 2021 due to an increase in exploration-related spending at the Elk Creek Project.

Going forward, the Company’s working capital requirements are expected to increase substantially in connection with the development

of the Elk Creek Project.

Financing Activities

Financing outflows were $0.5 million during

the six months ended December 31, 2022, as compared to $0.6 million of inflows during the corresponding period in 2021, with 2022 outflows reflecting the timing of vendor payments related to deferred Transaction costs incurred during the period and 2021 inflows primarily

reflecting the timing of warrant and option exercises, partially offset by a partial repayment under the related party

loan with our President, Chief Executive Officer (“CEO”) and Executive Chairman, Mark Smith.

Cash Flow Considerations

The Company has historically relied upon

debt and equity financings to finance its activities.

Subject to the restrictions set forth in the Business Combination Agreement

and the Yorkville Convertible Debt Financing Agreement, the Company may pursue additional debt and/or equity financing in the medium

The cash used in operating

activities for the nine months ended March 31, 2023, reflects the Company’s funding of losses of $35.7 million, partially

offset by net fair value losses related to NioCorp Assumed Warrants and the Earnout Shares liability, share-based compensation

and other non-cash transactions.

Overall, operational outflows during the nine months ended March 31, 2023, increased from the

corresponding period of 2022 due to cash expenses related to the Transactions and an increase in exploration-related spending at

the Elk Creek Project.

Going forward, the Company’s working capital requirements are expected to increase substantially in

connection with the development of the Elk Creek Project.

Financing inflows were $13.6 million during

the nine months ended March 31, 2023 (2022:

$0.7 million), with 2023 inflows reflecting the receipt of $14.9 million from the Yorkville

Convertible Debt Financing (net of costs), and $1.13 million of additional borrowings under the related party loan with our President,

Chief Executive Officer (“CEO”) and Executive Chairman, Mark Smith, partially offset by the repayment of the outstanding

balance at maturity of the Lind III Convertible Security, and a partial repayment of the related party loan with our CEO.

Flow Considerations

Company has historically relied upon debt and equity financings to finance its activities.

Subject to the restrictions set forth

in the Yorkville Convertible Debt Financing Agreement, the Company may pursue additional debt and/or equity financing in the medium

however, there can be no assurance the Company will be able to obtain any required financing in the future on acceptable

The Company has limited financial resources

compared to its proposed expenditures, no source of operating income, and no assurance that additional funding will be available

to it for current or future projects, although the Company has been successful in the past in financing its activities through

the sale of equity securities.

The ability of the Company to arrange additional

financing in the future will depend, in part, on the prevailing capital market conditions, including the impacts of the COVID-19

pandemic on the timing and availability of funding, and its success in developing the Elk Creek Project.

Any quoted market for

the Common Shares may be subject to market trends generally, notwithstanding any potential success of the Company in creating revenue,

cash flows, or earnings, and any depression of the trading price of the Common Shares could impact its ability to obtain equity

financing on acceptable terms.

Historically, the Company has used net

proceeds from issuances of Common Shares to provide sufficient funds to meet its near-term exploration and development plans and

other contractual obligations when due.

However, development and construction of the Elk Creek Project will require substantial

additional capital resources.

This includes near-term funding and, ultimately, funding for Elk Creek Project construction and other

See “ Liquidity and Capital Resources ” above for the Company’s discussion of arrangements related

to possible future financings.

Critical Accounting Estimates

There have been no material changes in

our critical accounting estimates discussed in “Management’s Discussion and Analysis of Financial Condition and Results

of Operations” under the heading “Critical Accounting Estimates and Recent Accounting Pronouncements” as of June

30, 2022, in our Annual Report on Form 10-K/A for the fiscal year ended June 30, 2022.

Company has limited financial resources compared to its proposed expenditures, no source of operating income, and no assurance

that additional funding will be available to it for current or future projects, although the Company has been successful in the

past in financing its activities through the sale of equity securities.

ability of the Company to arrange additional financing in the future will depend, in part, on the prevailing capital market conditions,

and its success in developing the Elk Creek Project.

Any quoted market for the Common Shares

may be subject to market trends generally,

notwithstanding any potential success of the Company in creating revenue, cash flows, or earnings, and any depression of the trading

price of the Common Shares could impact its ability to obtain equity financing on acceptable terms.

Historically,

the Company has used net proceeds from issuances of Common Shares to provide sufficient funds to meet its near-term exploration

and development plans and other contractual obligations when due.

However, development and construction of the Elk Creek Project

will require substantial additional capital resources.

This includes near-term funding and, ultimately, funding for Elk Creek

Project construction and other costs.

See “ Liquidity and Capital Resources ” above for the Company’s discussion

of arrangements related to possible future financings.

Accounting Estimates

Except as discussed below, there have been

no material changes in our critical accounting estimates discussed in “Management’s Discussion and Analysis of Financial

Condition and Results of Operations” under the heading “Critical Accounting Estimates and Recent Accounting Pronouncements”

as of June 30, 2022, in our Annual Report on Form 10-K/A for the fiscal year ended June 30, 2022.

We apply relevant accounting guidance for

warrants to purchase our stock based on the nature of the relationship with the counterparty.

For warrants issued to investors

or lenders in exchange for cash or other financial assets, we follow guidance issued within ASC 480, Distinguishing Liabilities

from Equity, and ASC Topic 815, Derivatives and Hedging, (“ASC 815”) to assist in the determination of whether the

warrants should be classified as liabilities or equity.

The fair value of warrants is estimated using Black Scholes modeling or

Monte Carlo modeling, depending on the settlement features embedded in the warrant.

Inputs under both models include inputs such

as NioCorp’s Common Share price, the risk-free interest rate, the expected term, the volatility, and the dividend rate.

that are determined to require liability classifications are measured at fair value upon issuance and are subsequently remeasured

to their then fair value at each subsequent reporting period with changes in fair value recorded in current earnings.

that are determined to require equity classifications measured at fair value upon issuance and are not subsequently remeasured

unless they are required to be reclassified.

Earnout Shares

The Earnout Shares are classified as a

liability due to failure to meet the equity classification criteria under ASC 815-40.

The fair value of the Earnout Shares on the

date of issuance and on each measurement date is estimated using a Monte Carlo simulation methodology, which includes inputs such

as NioCorp’s Common Share price, the risk-free interest rate, the expected term, the implied volatility underlying the Company’s

Public Warrants, the dividend rate, the conversion price, and the number of Earnout Shares outstanding.

Assumptions used in the

model are subjective and require significant judgment.

Federal Income Tax Considerations

NioCorp believes that it qualified as a

“passive foreign investment company” (“PFIC”) as defined under Section 1297 of the Code, in recent years,

including its taxable years ended June 30, 2022 and June 30, 2021.

However, based on the current composition of its income and

assets, as well as current business plans and financial expectations, NioCorp does not currently expect to be treated as a PFIC

for its taxable year or foreseeable future taxable years.

However, this conclusion is a factual determination that must be made

annually at the close of each taxable year and, thus, is subject to change.

In addition, it is possible notwithstanding NioCorp’s

conclusion that the IRS could assert, and that a court could sustain, a determination that NioCorp is a PFIC.

Accordingly, there

can be no assurance that NioCorp (or any of its subsidiaries) will not be treated as a PFIC for any taxable year.

Current and prospective

shareholders should consult their tax advisors as to the tax consequences of PFIC classification and the U.S.

treatment of PFICs.

Additional information on this matter is included in the “Risk Factors” section of the Company’s

Annual Report on Form 10-K/A for the fiscal year ended June 30, 2022, under the heading “Risks Related to the Common Shares.”

The Company has one class of shares, being

Common Shares.

A summary of outstanding shares, Options, Warrants, and convertible debt option as of February 13, 2023, is set

out below, on a fully-diluted basis.

Common Shares

NioCorp (or a subsidiary) is a “passive foreign investment company” (“PFIC”) for any taxable year during

the holding period of a U.S.

shareholder (as determined under applicable U.S.

federal income tax law), then certain significant

adverse tax consequences could apply to such U.S.

shareholder, including requirements to treat any gain realized upon a disposition

of Common Shares (or Warrants) as ordinary income, to include certain “excess distributions” on Common Shares in income,

and to pay an interest charge on a portion of any such gain or distribution.

NioCorp believes that it was classified as a PFIC

during the taxable years ended June 30, 2022 and 2021, and, based on the current composition of its income and assets, as well

as current business plans and financial expectations, that it may meet the PFIC qualification tests for its current taxable year

or in future taxable years.

No opinion of legal counsel or ruling from the Internal Revenue Service (the “IRS”) concerning

the PFIC status of NioCorp or any subsidiary has been obtained or is currently planned to be requested.

The determination of whether

any corporation was, or will be, a PFIC for a taxable year depends, in part, on the application of complex U.S.

federal income

tax rules, which are subject to differing interpretations.

In addition, whether any corporation will be a PFIC for any taxable

year depends on the assets and income of such corporation over the course of each such taxable year and, as a result, cannot be

predicted with certainty as of the date of this Quarterly Report on Form 10-Q.

In addition, even if NioCorp concluded that it

or any subsidiary did not qualify as a PFIC, the IRS could challenge any determination made by NioCorp (or any subsidiary) concerning

its PFIC status in any taxable year, and a court could sustain such challenge.

Accordingly, there can be no assurance that NioCorp

or any subsidiary will not be treated as a PFIC for any taxable year.

Each holder of Common Shares or other NioCorp instruments

should consult its own tax advisors regarding the PFIC status of NioCorp and each subsidiary thereof and the resulting tax consequences

to the shareholder.

See the “Risk Factors” section of this Quarterly Report on Form 10-Q.

Company has one class of shares, being Common Shares.

A summary of outstanding shares, Options, Warrants, and convertible debt

option as of May 30, 2023, is set out below, on a fully-diluted basis.

(fully diluted)

Common Shares

Convertible Debt 2

Vested Shares 1

Each exchangeable into one Common Share at any time, and from time to time, until the tenth anniversary

of the Closing Date.

Each exercisable into one Common Share.

2 Represents Common Shares issuable on conversion

of aggregate outstanding principal amounts of $0.515 million of convertible debt as of February 13, 2023, assuming a market price

per Common Share of $0.92 on that date.

Includes 15,666,626 NioCorp Assumed Warrants that are each exercisable into 1.11829212 Common Shares, and 1,737,651 Warrants that are each exercisable into one Common Share.

Represents Common Shares issuable on conversion of an aggregate outstanding principal amount of $16,147 of convertible debt as of May 30, 2023, assuming a market price per Common Share of $5.19 on that date.

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 2. Management’s Discussion and Analysis