NIOCORP DEVELOPMENTS LTD 10-K

ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA 53 REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM To the shareholders and the Board of Directors of NioCorp Developments Ltd. Opinion on the Financial Statements We have audited the accompanying consolidated balance sheet of NioCorp Developments Ltd. and subsidiaries (the “Company”) as of June 30, 2025 and 2024, the related consolidated statements of operations and comprehensive loss, cash flows, and shareholders’ equity and redeemable noncontrolling interest, for the each of the two years in the period ended June 30, 2025, the related notes (collectively referred to as the “financial statements”). In our opinion, the financial statements present fairly, in all material respects, the financial position of the Company as of June 30, 2025 and 2024, and the results of its operations and its cash flows for each of the two years in the period ended June 30, 2025 in conformity with accounting principles generally accepted in the United States of America. Going Concern The accompanying financial statements have been prepared assuming that the Company will continue as a going concern. As discussed in Note 4 to the financial statements, the Company has an accumulated deficit and does not generate any revenue. Further, the Company does not have sufficient cash on hand to fund normal operations as well as the construction necessary for mine development for the next twelve months. These conditions raise substantial doubt about its ability to continue as a going concern. Management’s plans in regard to these matters are also described in Note 4. The consolidated financial statements do not include any adjustments that might result from the outcome of this uncertainty. Basis for Opinion These financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on the Company’s financial statements based on our audit. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (PCAOB) and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB. We conducted our audit in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud. The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. As part of our audit, we are required to obtain an understanding of internal control over financial reporting but not for the purpose of expressing an opinion on the effectiveness of the Company’s internal control over financial reporting. Accordingly, we express no such opinion. Our audit included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. Our audit also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that our audit provides a reasonable basis for our opinion. Critical Audit Matter The critical audit matter communicated below is a matter arising from the current-period audit of the financial statements that was communicated or required to be communicated to the audit committee and that (1) relates to accounts or disclosures that are material to the financial statements and (2) involved our especially challenging, subjective, or complex judgments. The communication of critical audit matters does not alter in any way our opinion on the financial statements, taken as a whole, and we are not, by communicating the critical audit matter below, providing a separate opinion on the critical audit matter or on the accounts or disclosures to which it relates. 54 Warrants issued in the current year and classified as equity— Refer to Notes 3 and 10 to the financial statements Critical Audit Matter Description On September 17, 2024, November 5, 2024, January 31, 2025, and April 17, 2025, the Company issued warrants, which Management determined would be classified as equity when issued to investors or lenders, collectively referred to as the “Warrants”. For warrants issued to investors or lenders in exchange for cash or other financial assets, Management follows guidance issued within ASC 480, Distinguishing Liabilities from Equity , and ASC 815, Derivatives and Hedging , to assist in the determination of whether the warrants should be classified as liabilities or equity. Warrants that are determined to require equity classification are measured at fair value upon issuance and are not subsequently remeasured unless they are required to be reclassified. Given the significant assumptions made by management in determining the accounting classification for the Warrants, performing audit procedures to evaluate the reasonableness of management's conclusions required a high degree of auditor judgment and an increased extent of effort, including the need to involve professionals with expertise in accounting for complex financial instruments. How the Critical Audit Matter Was Addressed in the Audit Our audit procedures related to the Warrants included the following, among others: ● We evaluated management’s accounting position through the following procedures: ○ Obtained and evaluated the Company’s accounting memoranda regarding the application of the relevant accounting guidance for the Warrants. ○ Obtained, read and compared the underlying terms and conditions of the relevant contracts to the Company’s accounting memoranda and evaluated management’s identification of significant terms and conditions. ○ Evaluated the Company’s conclusions regarding the accounting treatment applied to the transactions with the assistance of professionals with expertise in accounting for complex financial instruments. ● Evaluated the completeness and accuracy of the disclosures related to the Warrants. /s/ Deloitte & Touche LLP Denver, Colorado September 11, 2025 DELOITTE & TOUCHE LLP 34 We have served as the Company’s auditor since fiscal year 2024. 55 NioCorp Developments Ltd. Consolidated Balance Sheets (expressed in thousands of U.S. dollars, except share data) As of June 30, 2025 2024 ASSETS Current Cash and cash equivalents $ 25,554 $ 2,012 Prepaid expenses and other 1,183 916 Total current assets 26,737 2,928 Non-current Deposits 37 35 Investment in equity securities 3 4 Right-of-use assets 118 181 Land and buildings, net 839 837 Mineral properties 16,085 16,085 Total assets $ 43,819 $ 20,070 LIABILITIES Current Accounts payable and accrued liabilities $ 1,795 $ 1,843 Warrant liabilities, at fair value - 2,365 Convertible debt - 7,660 Operating lease liability 98 96 Total current liabilities 1,893 11,964 Non-current Warrant liabilities, at fair value 6,852 1,651 Earnout liability, at fair value 5,880 3,817 Operating lease liability 33 104 Total liabilities 14,658 17,536 Commitments and contingencies - Redeemable noncontrolling interest 838 1,534 SHAREHOLDERS’ EQUITY Common stock, no par value, unlimited shares authorized; 58,491,196 and 38,062,647 shares outstanding, respectively 208,551 163,823 Accumulated deficit ( 179,317 ) ( 161,912 ) Accumulated other comprehensive loss ( 911 ) ( 911 ) Total shareholders’ equity 28,323 1,000 Total liabilities, redeemable noncontrolling interest, and shareholders’ equity $ 43,819 $ 20,070 The accompanying notes are an integral part of these consolidated financial statements 56 NioCorp Developments Ltd. Consolidated Statements of Operations and Comprehensive Loss (expressed in thousands of U.S. dollars, except share and per share data) For the year ended June 30, 2025 2024 Operating expenses Employee related costs $ 1,944 $ 3,509 Professional fees 2,237 3,533 Exploration expenditures 4,135 2,552 Other operating expenses 3,642 4,163 Total operating expenses 11,958 13,757 Change in fair value of earnout shares liability 2,063 ( 6,704 ) Change in fair value of warrant liabilities 4,093 ( 1,875 ) Change in fair value of convertible notes 40 2,542 Interest expense 48 4,490 Foreign exchange gain ( 5 ) ( 31 ) Interest income ( 94 ) - Other gains ( 122 ) ( 147 ) Loss on equity securities 1 5 Loss before income taxes ( 17,982 ) ( 12,037 ) Income tax benefit - ( 139 ) Net loss and comprehensive loss ( 17,982 ) ( 11,898 ) Net loss attributable to redeemable noncontrolling interest ( 577 ) ( 463 ) Net loss and net comprehensive loss attributable to the Company $ ( 17,405 ) $ ( 11,435 ) Loss per common share, basic and diluted $ ( 0.36 ) $ ( 0.31 ) Weighted average common shares outstanding 45,072,895 34,320,024 The accompanying notes are an integral part of these consolidated financial statements 57 NioCorp Developments Ltd. Consolidated Statements of Cash Flows (expressed in thousands of U.S. dollars) For the year ended June 30, 2025 2024 CASH FLOWS FROM OPERATING ACTIVITIES Net loss for the period $ ( 17,982 ) $ ( 11,898 ) Adjustments for: Change in valuation of earnout shares liability 2,063 ( 6,704 ) Change in valuation of warrant liabilities 4,093 ( 1,875 ) Change in fair value of convertible note 40 2,542 Accretion of convertible debt 43 4,490 Share-based compensation 789 2,881 Yorkville share issuances 589 105 Fair value of insider warrants 144 - Depreciation 3 2 Unrealized loss on equity securities 1 5 Noncash lease activity ( 6 ) 20 Other gains ( 122 ) ( 148 ) ( 10,345 ) ( 10,580 ) Change in working capital items: Prepaid expenses ( 267 ) 469 Accounts payable and accrued liabilities ( 48 ) ( 1,621 ) Net cash used in operating activities ( 10,660 ) ( 11,732 ) CASH FLOWS FROM INVESTING ACTIVITIES Acquisition of fixed assets ( 5 ) - Deposits ( 2 ) - Net cash used in investing activities ( 7 ) - CASH FLOWS FROM FINANCING ACTIVITIES Proceeds from issuance of common stock 45,666 6,185 Issuance of debt, net of costs - 6,935 Related party debt draws 504 - Related party debt repayments ( 504 ) - Debt repayments ( 7,223 ) ( 1,512 ) Share issue costs ( 4,234 ) ( 205 ) Net cash provided by financing activities 34,209 11,403 Change in cash and cash equivalents during period 23,542 ( 329 ) Cash and cash equivalents, beginning of period 2,012 2,341 Cash and cash equivalents, end of period $ 25,554 $ 2,012 Supplemental cash flow information: Amounts paid for interest $ 4 $ - Non-cash investing and financing transactions: Conversion of debt for common shares $ 501 $ 14,479 Value of Warrants issued 2,262 - The accompanying notes are an integral part of these consolidated financial statements 58 NioCorp Developments Ltd. Consolidated Statements of Shareholders’ Equity and Redeemable Noncontrolling Interest (expressed in thousands of U.S. dollars, except share data) Common Shares Outstanding Common Stock Accumulated Deficit Accumulated Other Comprehensive Loss Total Redeemable Noncontrolling Interest Balance, June 30, 2023 31,202,131 $ 140,421 $ ( 150,477 ) $ ( 911 ) $ ( 10,967 ) $ 2,100 Equity placements 978,432 2,995 - - 2,995 - Yorkville equity facility draws 1,358,000 3,398 - - 3,398 - Option exercises 7,800 - - - - - Redemption of vested shares 283,692 103 - - 103 ( 103 ) Debt conversions 4,232,592 14,479 - - 14,479 - Option liability valuations - ( 148 ) - - ( 148 ) - Share issuance costs - ( 204 ) - - ( 204 ) - Share-based compensation - 2,779 - - 2,779 - Loss for the year - - ( 11,435 ) - ( 11,435 ) ( 463 ) Balance, June 30, 2024 38,062,647 $ 163,823 $ ( 161,912 ) $ ( 911 ) $ 1,000 $ 1,534 Equity placements 13,321,628 30,059 - - 30,059 - Yorkville equity facility draws 5,671,742 12,941 - - 12,941 - Warrant exercises 828,235 1,809 - - 1,809 - Option exercises 512 - - - - - Redemption of vested shares 348,085 119 - - 119 ( 119 ) Debt conversions 258,347 501 - - 501 - Issuance of Lind Consent warrants - 2,262 - - 2,262 - Conversion of private warrants - 482 - - 482 - Share issuance costs - ( 4,234 ) - - ( 4,234 ) - Share-based compensation - 789 - - 789 - Loss for the year - - ( 17,405 ) - ( 17,405 ) ( 577 ) Balance, June 30, 2025 58,491,196 $ 208,551 $ ( 179,317 ) $ ( 911 ) $ 28,323 $ 838 The accompanying notes are an integral part of these consolidated financial statements 59 NioCorp Developments Ltd. Notes to the Consolidated Financial Statements June 30, 2025 (expressed in thousands of U.S. dollars, except share and per share data or as otherwise stated) 1. DESCRIPTION OF BUSINESS NioCorp Developments Ltd. (the “Company” or “NioCorp”) was incorporated on February 27, 1987, under the laws of the Province of British Columbia and currently operates in one reportable operating segment consisting of exploration and development of mineral deposits in the United States, specifically, the Elk Creek Niobium/Scandium/Titanium property (the “Elk Creek Project”) located in southeastern Nebraska. On March 17, 2023 (the “Closing Date”), the Company closed a series of transactions (the “GXII Transaction”), pursuant to the Business Combination Agreement, dated September 25, 2022 (the “Business Combination Agreement”), among the Company, GX Acquisition Corp. II (“GXII”), and Big Red Merger Sub Ltd (the “Closing”). At the Closing, the Company also closed convertible debt financings (the “Yorkville Convertible Debt Financing”) with YA II PN, Ltd., an investment fund managed by Yorkville Advisors Global, LP (together with YA II PN, Ltd., “Yorkville”), and the standby equity purchase facility with Yorkville (the “Yorkville Equity Facility Financing” and, together with the Yorkville Convertible Debt Financing, the “Yorkville Financings”) became effective. The transactions contemplated by the Business Combination Agreement, including the GXII Transaction, the Yorkville Financings and a 10-for-1 reverse stock split consummated in connection with the Closing, are referred to, collectively, as the “2023 Transactions.” The Company currently earns no operating revenues and will require additional capital in order to advance the Elk Creek Project to construction and commercial operation. As further discussed in Note 4, these matters raise substantial doubt about the Company’s ability to continue as a going concern, and the Company is dependent upon the generation of profits from mineral properties, obtaining additional financing, and maintaining continued support from its shareholders and creditors. 2. BASIS OF PREPARATION a) Basis of Preparation and Consolidation These consolidated financial statements have been prepared in conformity with generally accepted accounting principles of the United States of America (“U.S. GAAP”) and the rules and regulations of the U.S. Securities and Exchange Commission. The consolidated financial statements include the consolidated accounts of the Company and its wholly owned subsidiaries with all significant intercompany transactions eliminated. Certain transactions include reference to Canadian dollars (“C$”) where applicable. These consolidated financial statements include the accounts of the Company and the subsidiaries listed in the following table. All intercompany transactions and balances have been eliminated. Subsidiary Jurisdiction of incorporation Ownership at June 30, 2025 2024 0896800 BC Ltd. (“0896800”) British Columbia, Canada 100 % 100 % Elk Creek Resources Corp. (“ECRC”) (1) Delaware, USA 80.42 % 79.7 % NioCorp Technologies Limited United Kingdom 100 % 100 % (1) Represents 100% of Class A common stock owned by 0896800, and 3,934,031 and 4,282,116 Vested Shares and 3,391,596 and 3,391,596 Earnout Shares (each as defined below) held by third parties, and outstanding as of June 30, 2025 and 2024, respectively. b) Use of Estimates The preparation of consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities at the date of the consolidated financial statements, and the reported amounts of expenses during the reporting period. The Company regularly evaluates estimates and assumptions related to the valuation of mineral properties, deferred income tax asset valuations, convertible debt valuations, earnout valuation, derivative liabilities, warrant liabilities, and share-based compensation. The Company bases its estimates and assumptions on current facts, historical experience, and various other factors that it believes to be reasonable under the circumstances, the results of which form the basis for making judgments about the other sources. The actual results experienced by the Company may differ materially and adversely from the Company’s 60 NioCorp Developments Ltd. Notes to the Consolidated Financial Statements June 30, 2025 (expressed in thousands of U.S. dollars, except share and per share data or as otherwise stated) estimates. To the extent there are material differences between estimates and the actual results, future results of operations will be affected. 3. SIGNIFICANT ACCOUNTING POLICIES a) Development Stage Issuer The Company is considered to be a development stage issuer under Subpart 1300 of Regulation S-K of the United States Securities Act of 1933, as amended (“S-K 1300”), and it devotes substantially all of its efforts to acquiring and exploring mining interests that management believes should eventually provide sufficient net profits to sustain the Company’s existence. Until such interests are engaged in commercial production, the Company will continue to seek additional funding to support the completion of its exploration and development activities. The Company’s activities are subject to significant risks and uncertainties, including its ability to secure sufficient funding to continue operations, to obtain proven and probable reserves, to comply with industry regulations and obtain permits necessary for development of the Elk Creek Project, as well as environmental risks and market conditions. b) Cash and Cash Equivalents Cash and cash equivalents include cash on hand, cash in banks, investments in certificates of deposit with original maturities of 90 days or less, and money market funds. The Company maintains the majority of its cash balances with two financial institutions. Accounts at banks in the United States (“U.S.”) are insured by the Federal Deposit Insurance Corporation (“FDIC”) up to $250, while accounts at banks in Canada are insured by the Canada Deposit Insurance Corporation (“CDIC”) up to C$100. At June 30, 2025, the Company had $24,711 and $22 in excess of the FDIC and CDIC insured limits, respectively. c) Foreign Currency Translation Functional and reporting currency Items included in the financial statements of each of the Company’s entities are measured using the currency of the primary economic environment in which the entity operates (“the functional currency”). The functional currency for all entities is the U.S. Dollar except for NioCorp Technologies Limited, which is measured in British Pounds. The reporting currency for these consolidated financial statements is U.S. dollars. Transactions in foreign currency Transactions made in a currency other than the functional currency are remeasured to the functional currency at exchange rates at the dates of the transactions. Monetary assets and liabilities denominated in foreign currencies at the reporting date are remeasured to the functional currency at the exchange rate at that date and non-monetary assets and liabilities are remeasured at historical rates. Foreign currency translation gains and losses are included in profit or loss. Translation to reporting currency Translation gains and losses from the application of the U.S. dollar as the reporting currency, if any, are included as part of cumulative currency translation adjustment, which is reported as a component of shareholders’ equity under accumulated other comprehensive loss. d) Mineral Properties Mineral property acquisition costs, including indirectly related acquisition costs, are capitalized when incurred. Acquisition costs include cash consideration and the fair market value of common shares, no par value, of the Company (“Common Shares”) issued as consideration. Properties acquired under option agreements, whereby payments are made at the sole discretion of the Company, are capitalized as mineral property acquisition costs at such time as the payments are made. Exploration costs are expensed as incurred. When it is determined that a mining deposit can be economically and legally extracted or produced based on established proven and probable reserves under S-K 1300, and the Company’s board of directors (the “Board”) has approved the commencement of formal development activities, development costs related to such reserves and incurred after such board approval will be considered for capitalization. The establishment of proven and probable reserves is based on 61 NioCorp Developments Ltd. Notes to the Consolidated Financial Statements June 30, 2025 (expressed in thousands of U.S. dollars, except share and per share data or as otherwise stated) results of feasibility studies, which indicate whether a property is economically feasible. Upon commencement of commercial production, capitalized costs will be amortized over their estimated useful lives or units of production, whichever is a more reliable measure. Capitalized amounts relating to a property that is abandoned or otherwise considered uneconomic for the foreseeable future are written off. The recoverability of the carrying values of mineral properties is dependent upon economic reserves being discovered or developed on the properties, permitting, financing, start-up, and commercial production from, or the sale/lease of, or other strategic transactions related to these properties. Development and/or start-up of a project will depend on, among other things, management’s ability to raise sufficient capital for these purposes. We assess the carrying cost of our mineral properties for impairment whenever information or circumstances indicate the potential for impairment. This would include events and circumstances such as our inability to obtain all the necessary permits, changes in the legal status of our mineral properties, government actions, the results of exploration activities and technical evaluations and changes in economic conditions, including the price of commodities or input prices. Such evaluations compare estimated future net cash flows with our carrying costs and future obligations on an undiscounted basis. If it is determined that the estimated future undiscounted cash flows are less than the carrying value of the property, an impairment loss will be recorded. Where estimates of future net cash flows are not determinable and where other conditions indicate the potential for impairment, management uses available market information and/or third-party valuation experts to assess if the carrying value can be recovered and to estimate fair value. There was no impairment recorded to mineral properties as of June 30, 2025 or 2024, respectively. e) Long Lived Assets Long-lived assets, other than mineral properties, held and used by the Company are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. For purposes of evaluating the recoverability of long-lived assets, the recoverability test is performed using undiscounted net cash flows related to the long-lived assets. If such assets are considered to be impaired, the impairment recognized is measured by the amount by which the carrying amount of the assets exceeds the fair value of the assets. Assets to be disposed of are reported at the lower of the carrying amount or fair value less costs to sell. There was no impairment recorded to long-lived assets as of June 30, 2025 or 2024, respectively. f) Leases Under Accounting Standards Codification (“ASC”) 842, Leases , we determine if a contractual arrangement is, or contains, a lease at the inception date. Right-of-use (“ROU”) assets and liabilities related to operating leases are separately reported in the consolidated balance sheets. The Company currently has no finance leases. ROU assets and lease liabilities are recognized at the lease commencement date based on the present value of the future lease payments over the lease term. When the rate implicit to the lease cannot be readily determined, we utilize our incremental borrowing rate in determining the present value of the future lease payments. The incremental borrowing rate is derived from information available at the lease commencement date and represents the rate of interest that a lessee would have to pay to borrow an amount equal to the lease payments on a collateralized basis over a similar term in a similar economic environment. Operating lease ROU assets also include any cumulative prepaid or accrued rent when the lease payments are uneven throughout the lease term. The ROU assets and lease liabilities may include options to extend or terminate the lease when it is reasonably certain that we will exercise that option. Lease liabilities are increased by interest and reduced by payments each period, and the ROU asset is amortized over the lease term. For operating leases, interest on the lease liability and the amortization of the ROU asset result in straight-line rent expense over the lease term. Variable lease expenses are recorded when incurred. g) Convertible Debt Carried at Fair Value With regard to the Company’s debt related to the convertible promissory notes issued in April 2024 (as further discussed in Note 8), the Company has elected to account for these notes at fair value per the provisions of ASC Topic 815, Derivatives and Hedging (“ASC 815”). Under ASC 815-15-25, an election can be taken at the inception of a financial instrument to account for the instrument at fair value. The notes were recorded at fair value at inception and assessed quarterly thereafter using a Monte Carlo simulation methodology which 62 NioCorp Developments Ltd. Notes to the Consolidated Financial Statements June 30, 2025 (expressed in thousands of U.S. dollars, except share and per share data or as otherwise stated) incorporates multiple conversion scenarios. All changes in fair value subsequent to the initial recording, excluding the impact of the change in fair value related to the Company’s own credit risk, are recorded as a component of non-operating income/expense, within Change in fair value of convertible debt in the consolidated statements of operations. Changes in fair value related to the Company’s own credit risk, if any, are recorded through other comprehensive loss. h) Warrants We apply relevant accounting guidance for warrants to purchase our Common Shares (“Warrants”) based on the nature of the relationship with the counterparty. The Company has made an accounting policy election that the “greater of” Share-Price Input to the Black-Scholes Value would not preclude equity classification. The Company has not had any historical transactions that include the “greater of” Share-Price Input feature, and this is a new accounting policy election as of the current fiscal year. 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 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. Warrants 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. Warrants 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. i) Earnout Shares Earnout Shares are classified as a liability due to failure to meet the equity classification criteria under ASC 815-40. The Earnout Shares are measured at fair value upon issuance and subsequently remeasured at each reporting period 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 weighted average of historical Common Share volatility and implied volatility underlying the Company’s publicly traded 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. j) Financial Instruments The Company’s financial instruments consist of cash and cash equivalents, receivables, equity securities, and accounts payable and accrued liabilities. It is management’s opinion that the Company is not exposed to significant interest, currency or credit risks arising from its financial instruments. The fair values of these instruments approximate their carrying value unless otherwise noted. k) Concentration of Credit Risk The financial instrument which potentially subjects the Company to credit risk is cash and cash equivalents, The Company holds investments or maintains available cash primarily in two commercial banks located in Vancouver, British Columbia and Columbus, Ohio. As part of its cash management process, the Company regularly monitors the relative credit standing of these institutions. l) Asset Retirement Obligation The Company is subject to various government laws and regulations relating to environmental disturbances caused by exploration and evaluation activities. The estimated costs associated with environmental remediation obligations are accrued in the period in which the liability is incurred if it is reasonably estimable or known. Until such time that a project life is established, the Company records the corresponding cost as an exploration stage expense and has accrued $ 48 and $ 48 for estimated obligations as of June 30, 2025 and June 30, 2024, respectively. Future reclamation and environmental-related expenditures are difficult to estimate in many circumstances due to the early-stage nature of the Elk Creek Project, the uncertainties associated with defining the nature and extent of environmental disturbance, the application of laws and regulations by regulatory authorities and changes in reclamation or remediation technology. The Company periodically reviews accrued liabilities for such reclamation and remediation costs as evidence indicating that the liabilities have potentially changed becomes available. Changes in estimates are reflected in the consolidated statement of operations and comprehensive loss in the period an estimate is revised. 63 NioCorp Developments Ltd. Notes to the Consolidated Financial Statements June 30, 2025 (expressed in thousands of U.S. dollars, except share and per share data or as otherwise stated) m) Income Taxes Income taxes are provided based upon the liability method of accounting pursuant to ASC 740-10-25, “Income Taxes – Recognition.” Under the approach, deferred income taxes are recorded to reflect the tax consequences in future years of differences between the tax basis of assets and liabilities and their financial reporting amounts at each year-end. A valuation allowance is recorded against deferred tax assets if management does not believe the Company has met the “more likely than not” standard imposed by ASC 740-10-25-5 to allow recognition of such an asset. ASC 740-10-50, “Income Taxes – Disclosure,” requires the Company to evaluate its income tax positions and recognize a liability for uncertain tax positions that are not more likely than not to be sustained by tax authorities. As of June 30, 2025 and 2024, the Company believes it had no income tax uncertainties that required recognition of a liability. If the Company were to determine that uncertain tax positions meet the criteria for recognition, an estimated liability and related interest and penalties would be recognized as income tax expense. n) Redeemable Noncontrolling Interest Redeemable Noncontrolling Interest refers to non-controlling interest associated with the Vested Shares that are redeemable upon the occurrence of an event that is not solely within the Company’s control and is reported in the mezzanine section between total liabilities and shareholders’ deficit, as temporary equity in the Company’s consolidated balance sheets. The Company’s non-controlling interest is redeemable at fair value, and no adjustment to the earnings per share numerator is required because redemption at fair value is not considered an economic distribution different from other common stockholders. o) Basic and Diluted Per Share Disclosure Basic earnings (loss) per share represents net earnings (loss) attributable to common shareholders divided by the weighted average number of Common Shares outstanding during the period. The Company considers Vested Shares and Released Earnout Shares (each as defined in Note 9), to be participating securities, requiring the use of the two-class method. Diluted earnings (loss) per share represents net earnings (loss) attributable to common shareholders divided by the weighted average number of Common Shares outstanding, inclusive of the dilutive impact of all potentially dilutive securities outstanding during the period, as applicable. The Company utilizes the weighted average method to determine the impact of changes in a participating security on the calculation of loss per share. The following table sets forth the computation of the Company’s basic and diluted net loss per share attributable to common shareholders: For the year ended June 30, 2025 2024 Net loss $ ( 17,982 ) $ ( 11,898 ) Adjust: Net loss attributable to noncontrolling interest 577 458 Net loss available to participating securities ( 17,405 ) ( 11,440 ) Net loss attributable to Vested Shares 1,102 967 Net loss attributed to common shareholders - basic and diluted $ ( 16,303 ) $ ( 10,473 ) Denominator: Weighted average shares outstanding – basic and diluted 45,072,895 34,320,024 Loss per Common Share outstanding – basic and diluted $ ( 0.36 ) $ ( 0.31 ) The following shares underlying options to purchase Common Shares (“Options”), Warrants, and outstanding convertible debt were antidilutive due to a net loss in the periods presented and, therefore, were excluded from the dilutive securities computation for the periods indicated below: Schedule of excluded from the dilutive securities For the year ended June 30, Excluded potentially dilutive securities (1)(2) : 2025 2024 Options 3,020,000 2,495,500 Warrants 31,839,152 18,563,561 Convertible debt - 2,849,000 Total potentially dilutive securities 34,859,152 23,908,061 64 NioCorp Developments Ltd. Notes to the Consolidated Financial Statements June 30, 2025 (expressed in thousands of U.S. dollars, except share and per share data or as otherwise stated) (1) The number of shares is based on the maximum number of shares issuable on exercise or conversion of the related securities as of the period end. Such amounts have not been adjusted for the treasury stock method or weighted average outstanding calculations as required if the securities were dilutive. (2) Earnout Shares (as defined below) are excluded as the vesting terms were not met as of the end of the reporting period. p) Share Based Compensation The Company grants Options to directors, officers, employees, and business advisors. Option terms and vesting conditions are at the discretion of the Board. The Option exercise price is equal to the closing market price on the Nasdaq Stock Market LLC (“Nasdaq”) on the day preceding the date of the grant. The Company estimates the fair value of Options using the Black-Scholes option pricing model. The Company recognizes forfeitures as they occur. q) Recent Accounting Standards Recently Adopted Accounting Standards In fiscal year 2025, we adopted Accounting Standards Update (“ASU”) 2023-07, Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures . Management has evaluated the Company’s operations and concluded it has one reportable operating segment which will now require expanded disclosure. Adoption was made retroactively with segment disclosure included for the fiscal years ended June 30, 2025 and 2024. This standard has not changed the processing, recording, or presentation of financial data, other than providing additional disclosure regarding management oversight for the Company’s single operating segment. Issued and Not Effective In December 2023, the FASB issued ASU 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures , which includes amendments that further enhance income tax disclosures, primarily through standardization and disaggregation of rate reconciliation categories and income taxes paid by jurisdiction. The amendments are effective for the Company’s annual periods beginning July 1, 2025, with early adoption permitted, and should be applied either prospectively or retrospectively. The Company is currently evaluating the ASU to determine its impact on the Company’s disclosures. From time to time, new accounting pronouncements are issued by the FASB that are adopted by the Company as of the specified effective date. Unless otherwise discussed, management believes that the impact of recently issued standards did not or will not have a material impact on the Company’s consolidated financial statements upon adoption. 4. GOING CONCERN ISSUES The Company incurred a net loss of $ 17,405 for the year ended June 30, 2025 (2024 - $ 11,435 ) and had an accumulated deficit of $ 179,317 as of June 30, 2025. As a development stage issuer, the Company has not yet commenced its mining operations and accordingly does not generate any revenue. The Company does not have sufficient cash on hand to fund planned operations as well as the construction necessary for mine development for the next twelve months. The Company is dependent on its ability to raise capital to fund future exploration and working capital requirements. These conditions and events raise substantial doubt about the Company’s ability to continue as a going concern. In response to these conditions and events, the Company plans to obtain additional financing. As discussed in Note 17, on July 18, 2025, the Company closed a public offering which resulted in net proceeds of approximately $ 41,762 after deducting placement agent fees and discounts. Subject to the conditions discussed in Note 10a, NioCorp expects to have access to up to $ 46,917 in net proceeds from the Standby Equity Purchase Agreement, dated January 26, 2023 (the “Yorkville Equity Facility Financing Agreement”), between the Company and YA II PN, Ltd., an investment fund managed by Yorkville Advisors Global, LP (“Yorkville”), through April 1, 2026. In addition, the Company may pursue additional sources of 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. Other than the potential issuance of Common Shares under the Yorkville Equity Facility Financing Agreement, the Company did not have any further funding commitments or arrangements 65 NioCorp Developments Ltd. Notes to the Consolidated Financial Statements June 30, 2025 (expressed in thousands of U.S. dollars, except share and per share data or as otherwise stated) for additional financing as of June 30, 2025. The Company’s plans to obtain additional financing have not been finalized, are subject to market conditions, and are not within the Company’s control and therefore cannot be deemed probable. Further, the Company will be required to raise additional funds for the construction and commencement of operations. As a result, the Company has concluded that management’s plans do not alleviate substantial doubt about the Company’s ability to continue as a going concern. 5. LAND AND BUILDINGS, NET Schedule of properties As of June 30, 2025 2024 Cost Accumulated Depreciation Net Cost Accumulated Depreciation Net Land $ 807 $ - $ 807 $ 807 $ - $ 807 Buildings and other 46 14 32 41 11 30 Land and buildings, net $ 853 $ 14 $ 839 $ 848 $ 11 $ 837 6. MINERAL PROPERTIES Mineral properties consist of original acquisition costs and purchased mineral rights related to the Elk Creek Project. In addition to the land and mineral rights currently owned by the Company, the property interests of Elk Creek include seven prepaid mineral exploration option-to-purchase agreements which include a pre-determined buyout for permanent ownership of the mineral and/or surface rights. Terms of the agreements require no further significant payments, and the Company may terminate the leases, negotiate lease extensions, or elect to purchase the mineral and/or surface rights any time. Agreements that allow for the purchase of mineral rights contain provisions whereby the landowners would retain a 2% net smelter return. During the year ended June 30, 2025, the Company completed negotiations with landowners in Nebraska and entered into contract amendments which extended the option periods by approximately five years for option to purchase agreements (“OTP”) covering six parcels of land for project construction and operation which the Company does not already own. The Company recorded an exploration expense for $ 310 paid for OTP extension payments made and will make periodic payments totaling $ 93 over the extension period. 7. ACCOUNTS PAYABLE AND ACCRUED LIABILITIES Schedule of account payable and accrued liabilities As of June 30, 2025 2024 Accounts payable, trade $ 692 $ 1,417 Trade payable accruals 1,055 350 Environmental accruals 48 48 Loan origination fees payable to related party - 28 Total accounts payable and accrued liabilities $ 1,795 $ 1,843 8. CONVERTIBLE DEBT Schedule of convertible debt As of June 30, 2025 2024 Yorkville convertible debentures $ - $ 571 April 2024 notes - 7,089 Total convertible debt $ - $ 7,660 Yorkville Convertible Debentures Pursuant to the Yorkville Convertible Debt Financing Agreement, at the Closing, Yorkville advanced a total amount of $15,360 to NioCorp in consideration of the issuance by NioCorp to Yorkville of (i) $ 16,000 aggregate principal 66 NioCorp Developments Ltd. Notes to the Consolidated Financial Statements June 30, 2025 (expressed in thousands of U.S. dollars, except share and per share data or as otherwise stated) amount of unsecured convertible debentures (the “Convertible Debentures”) and (ii) 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. On July 19, 2024, the Company and Yorkville entered into a make-whole payment agreement under which Yorkville agreed to convert the remaining outstanding principal and accrued interest of $ 554 under the Convertible Debentures into Common Shares in exchange for a $ 95 make-whole payment. The Company recorded a gain on extinguishment of $ 19 as part of other gains in the condensed consolidated statements of operations and comprehensive loss. Changes in the Convertible Debentures are as follows: Schedule of changes in the convertible debentures Amount Balance, June 30, 2023 $ 10,561 Accretion expense 4,489 Principal and accrued interest converted ( 14,479 ) Balance, June 30, 2024 571 Accretion expense 43 Principal and interest converted ( 614 ) Balance, June 30, 2025 $ - The following table discloses the components of interest expense associated with the Convertible Debentures: Schedule of components of interest expense with convertible debenture For the year ended June 30, Component of Interest Expense 2025 2024 Amortization of discount and issuance costs $ 42 $ 4,210 Contractual interest 1 279 Total $ 43 $ 4,489 April 2024 Notes On April 12, 2024, the Company issued and sold to Yorkville and Lind Global Fund II LP (together with Yorkville, the “April 2024 Purchasers”), $8,000 aggregate principal amount of unsecured notes (the “April 2024 Notes”), pursuant to a securities purchase agreement, dated April 11, 2024 (the “April 2024 Purchase Agreement”), between the Company and each of the April 2024 Purchasers. The Company also issued to the April 2024 Purchasers, in proportion to the aggregate principal amount of April 2024 Notes issued to each April 2024 Purchaser, Warrants (the “April 2024 Warrants”) to purchase up to 615,385 Common Shares (the “April 2024 Warrants Shares”), which were equal to 25% of the aggregate principal amount of April 2024 Notes issued to the April 2024 Purchasers divided by the exercise price of $3.25, subject to any adjustment to give effect to any stock dividend, stock split or recapitalization. The April 2024 Warrants expire on April 12, 2027. Pursuant to the April 2024 Purchase Agreement, the April 2024 Purchasers advanced an aggregate of $6,935 to the Company in consideration of the issuance by the Company to the April 2024 Purchasers of $8,000 aggregate principal amount of the April 2024 Notes and April 2024 Warrants. Under the terms of the April 2024 Notes, subject to certain exceptions, on the first day of each calendar month, beginning on June 1, 2024 (excluding August 2024) (the “Payment Date”), the Company was required to repay a portion of the outstanding balance of all of the April 2024 Notes, on a pro-rata basis, in an amount equal to the sum of (i) $1,400 of principal (or the outstanding principal if less than such amount) in the aggregate among all of the outstanding Notes, plus (ii) 8.0% of the principal amount being paid (the “Payment Premium”), and (iii) accrued and unpaid interest, if any, as of the Payment Date. The Company was required to make payments on each Payment Date until the entire outstanding principal was repaid but did not have an obligation to make a payment on a Payment Date if certain equity conditions were satisfied. 67 NioCorp Developments Ltd. Notes to the Consolidated Financial Statements June 30, 2025 (expressed in thousands of U.S. dollars, except share and per share data or as otherwise stated) Subject to certain limitations contained within the April 2024 Notes, holders of the April 2024 Notes were entitled to convert the principal amount of, accrued and unpaid interest, if any, and any Payment Premium that has become due and payable on each April 2024 Note, from time to time over their term, into a number of Common Shares equal to the quotient of the amount being converted divided by a fixed conversion price of $2.75 per Common Share up to a maximum of 3,141,817 Common Shares (together with the April 2024 Warrant Shares, the “April 2024 Underlying Shares”). The terms of the April 2024 Notes restricted the conversion of the April 2024 Notes by a holder if such a conversion would have caused such holder to exceed certain ownership thresholds in the Company. The April 2024 Notes were the unsecured obligations of the Company and were originally scheduled to mature on December 31, 2024. The April 2024 Notes incurred a simple interest rate obligation of 0.0% per annum (which would have increased to 18.0% per annum upon the occurrence of an event of default). The April 2024 Notes were also redeemable at the Company’s option at any time and from time to time over their term at a redemption price equal to the principal amount being redeemed, plus the Payment Premium, plus accrued and unpaid interest, if any, as of the redemption date. The April 2024 Notes contained events of default customary for instruments of their type (with customer grace periods, as applicable) and provided that, upon the occurrence of an event of default arising from certain events of bankruptcy or insolvency with respect to the Company, all outstanding April 2024 Notes would become due and payable immediately without further action or notice. If any other type of event of default occurred and continued, then any holder could have declared all of its April 2024 Notes to be due and payable immediately. The April 2024 Purchase Agreement contained customary representations, warranties, conditions and indemnification obligations by each party. The representations, warranties and covenants contained in the April 2024 Purchase Agreement were made only for purposes of the April 2024 Purchase Agreement and as of specific dates, were solely for the benefit of the parties to such agreement and are subject to certain important limitations. The April 2024 Purchase Agreement also contained certain covenants that, among other things, limited NioCorp’s ability to use the proceeds from the April 2024 Purchase Agreement to repay related party debt or to enter into any variable rate transaction other than with Yorkville, subject to certain exceptions, and to distribute proceeds from the April 2024 Purchase Agreement to subsidiaries other than ECRC and 0896800 B.C. Ltd. (together with ECRC, the “Guarantors”), upon the entry by the Guarantors into a global guaranty agreement, dated as of April 11, 2024, among the Guarantors in favor of the April 2024 Purchasers (the “Guaranty Agreement”). Pursuant to the Guaranty Agreement, the Guarantors guaranteed the full, prompt and unconditional payment when due (whether at maturity, by acceleration or otherwise), and the performance of all liabilities, agreements and other obligations of NioCorp to the April 2024 Purchasers contained in the April 2024 Notes, the April 2024 Warrants, and the April 2024 Purchase Agreement, to the extent such liabilities, agreements, and obligations are payable in cash. Based upon the Company’s analysis of the criteria contained in ASC 815, the Company determined that April 2024 Warrants met the definition of a derivative liability, as any Warrant exercise that could cause the holder to exceed 19.9% ownership of NioCorp Common Shares would require shareholder approval. As such, the April 2024 Warrants are recognized as Warrant liabilities on the consolidated balance sheet and were measured at their inception date fair value and are subsequently remeasured at each reporting period with changes being recorded as a non-operating gain or loss in the consolidated statement of operations and comprehensive loss. The Company elected to value the April 2024 Notes at fair value in accordance with ASC 815-15-25. The fair value of the April 2024 Notes was estimated using a Monte Carlo simulation pricing model and the April 2024 Notes were classified as Level 3 instruments. The Company incurred transaction costs totaling $ 474 in connection with the issuance of the April 2024 Notes and due to the fair value election noted above, these costs were expensed at closing. Components and initial valuations associated with the April 2024 Notes were comprised of the following amounts: 68 NioCorp Developments Ltd. Notes to the Consolidated Financial Statements June 30, 2025 (expressed in thousands of U.S. dollars, except share and per share data or as otherwise stated) ● $902 was recorded to Warrant liabilities, representing the initial fair value of the April 2024 Warrants based on the assumptions outlined below. ● $ 10,315 was recorded to the April 2024 Notes, representing the fair value based on the assumptions outlined below. The Company also recognized an opening transaction loss of $ 4,256 , representing the difference between the fair value of the April 2024 Notes, including the fair value of the variable conversion features embedded therein, and cash received in the transaction. The following table discloses the primary inputs for the Monte Carlo model used in valuing the April 2024 Notes: Schedule of primary inputs for the Monte Carlo model Key Valuation Input June 30, 2024 April 12, 2024 Closing Common Share price $ 1.73 $ 3.11 Term (expiry) December 31, 2024 December 31, 2024 Weighted average of the equity volatility and implied volatility of the 2023 Public Warrants 80 % 66.0 % Risk-free rate 5.33 % 5.26 % Implied discount rate 15.0 % 15.0 % On September 4, 2024 and October 3, 2024, the Company entered into (i) consents and waivers (the “2024 Yorkville Consents”) to the April 2024 Notes issued and sold to Yorkville pursuant to the April 2024 Purchase Agreement and (ii) consents and waivers (together with the 2024 Yorkville Consents, the “2024 Note Consents”) to the April 2024 Notes issued and sold to Lind II pursuant to the April 2024 Purchase Agreement. The 2024 Note Consents, among other things, extended and deferred certain monthly payments and extended the maturity of the April 2024 Notes until January 31, 2025. On January 3, 2025, the Company entered into a consent and waiver (the “January Yorkville Consent”) to the April 2024 Notes issued and sold to Yorkville pursuant to the April 2024 Purchase Agreement. The January Yorkville Consent, among other things, deferred the due date for the amounts that would otherwise have been due to Yorkville on January 1, 2025 to the maturity date and extended the maturity date to February 17, 2025, and prospectively waived any term of the April 2024 Notes that would otherwise be triggered upon a failure of the Company to pay to Yorkville the remainder of the amount due on January 1, 2025. All remaining amounts due to Lind II ($176) and Yorkville ($1,000) under the April 2024 Notes were repaid on January 6, 2025, and February 7, 2025, respectively. The following table sets forth a summary of the changes in the fair value of the April 2024 Notes: Schedule of changes in the fair value of April 2024 Note Amount Fair value, April 12, 2024 $ 10,315 Principal payments ( 1,512 ) Change in fair value ( 1,714 ) Balance, June 30, 2024 7,089 Principal payments ( 7,129 ) Change in fair value 40 Balance, June 30, 2025 $ - The following table discloses the primary inputs for the Black-Scholes model used in valuing the April 2024 Warrants: Schedule of Black-Scholes model used in April 2024 Warrants Key Valuation Input June 30, 2025 June 30, 2024 Closing Common Share price $ 2.33 $ 1.73 Term (years) 1.78 2.78 Historic equity volatility 82.22 % 66.34 % Risk-free rate 3.78 % 4.57 % 69 NioCorp Developments Ltd. Notes to the Consolidated Financial Statements June 30, 2025 (expressed in thousands of U.S. dollars, except share and per share data or as otherwise stated) The following table sets forth a summary of the changes in the fair value of the April 2024 Warrant liability: Schedule of changes in fair value of April 2024 Warrant liability Amount Fair value as of April 12, 2024 $ 902 Change in fair value ( 604 ) Fair value as of June 30, 2024 298 Change in fair value 191 Fair value as of June 30, 2025 $ 489 9. CLASS B COMMON STOCK OF ECRC Holders of the Class B common stock of ECRC have the right to exchange such shares for Common Shares on a one-for-one basis, subject to certain equitable adjustments, under certain conditions. All 7,957,404 shares of Class B common stock of ECRC that were issued in connection with the Closing were issued and outstanding as of June 30, 2023. 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. Under certain circumstances, and subject to certain exceptions, NioCorp may instead settle all or a portion of any exchange pursuant to the terms of the Exchange Agreement, dated as of March 17, 2023, by and among NioCorp, ECRC, and GX Sponsor II LLC (the “Sponsor”) in cash, in lieu of Common Shares, based on a volume-weighted average price of Common Shares. On February 28, 2024 and May 16, 2024, 243,692 Vested Shares and 40,000 Vested Shares, respectively, were exchanged for an equivalent number of Common Shares, and on December 12, 2024 and December 20, 2024, 25,000 Vested Shares and 323,085 Vested Shares, respectively, were exchanged for an equivalent number of Common Shares. These exchanges resulted in a change in the Company’s ownership interest in ECRC and were accounted for as an equity transaction in accordance with ASC 810-10-45-23, with no gain or loss recognized. Accordingly, the carrying amount of the noncontrolling interest was adjusted to reflect the change in the Company’s ownership interest with a corresponding offset to equity. Both Vested Shares and Released Earnout Shares (as defined below) may be exchanged by the holders into Common Shares at any time. All Vested Shares and Earnout Shares must be exchanged for Common Shares by the Ten-Year Anniversary except for Released Earnout Shares that have been vested for a period of fewer than twenty-four months as of the Ten-Year Anniversary. Such Released Earnout Shares will be forfeited if not exchanged for Common Shares by the date that is twenty-four months after the vesting date. Vested Shares As the exchange of Vested Shares are contingently redeemable at the option of the noncontrolling interest shareholders, the Company classifies the carrying amount of the redeemable noncontrolling interest in the mezzanine section on the consolidated balance sheet, which is presented above the equity section and below liabilities. Adjustments to the carrying value of the redeemable noncontrolling interest associated with redemptions are recorded by reclassifying the proportionate amount of mezzanine equity to permanent equity. Earnout Shares The Earnout Shares vest (the “Released Earnout Shares”) in two equal tranches based upon achieving market share price milestones of approximately $12.00 per Common Share and approximately $15.00 per Common Share, respectively, prior to the Ten-Year Anniversary, or upon a change in control as defined in the underlying agreement. These shares will be forfeited if the market share price milestones or an acceleration event is not reached prior to the Ten-Year Anniversary. At such time that the Earnout Shares shall become vested, and therefore, become Released Earnout Shares, the shares will be transferred to the redeemable noncontrolling interest in the mezzanine section of the Consolidated Balance Sheet. 70 NioCorp Developments Ltd. Notes to the Consolidated Financial Statements June 30, 2025 (expressed in thousands of U.S. dollars, except share and per share data or as otherwise stated) The Earnout Shares were classified as a liability due to failure to meet the equity classification criteria under ASC 815-40, as Level 3 instruments under the fair value hierarchy and are considered a financial liability under ASC 480, Distinguishing Liabilities from Equity. The Earnout Shares were measured at fair value on the Closing Date with subsequent changes in fair value recorded in earnings. The Earnout Shares were valued utilizing a Monte Carlo simulation pricing model. The following table discloses the primary inputs into the Monte Carlo models: Schedule of key valuation input Key Valuation Input June 30, 2025 June 30, 2024 June 30, 2023 Closing Common Share price $ 2.33 $ 1.73 $ 5.03 Term (expiry) March 17, 2033 March 17, 2033 March 17, 2033 Implied volatility of the 2023 Public Warrants 75.0 % 65.0 % 33.5 % Risk-free rate 4.04 % 4.35 % 3.83 % The following table sets forth a summary of the changes in the fair value of the Earnout Shares liability for the year ended June 30, 2025: Schedule of fair value of the Earnout Shares liability Amount Fair value as of June 30, 2023 $ 10,521 Change in fair value ( 6,704 ) Fair value as of June 30, 2024 3,817 Change in fair value 2,063 Fair value as of June 30, 2025 $ 5,880 10. COMMON SHARES a) Issuances Fiscal Year 2025 Issuances On November 5, 2024, the Company closed an underwritten public offering (the “November 2024 Registered Offering”), pursuant to the underwriting agreement, dated November 3, 2024 (the “Underwriting Agreement”), with Maxim Group LLC (“Maxim”), as underwriter, which consisted of 1,592,356 Common Shares, 1,672,090 Warrants (the “Series A Public Warrants”) to purchase up to an additional 1,672,090 Common Shares and 836,045 Warrants (the “Series B Public Warrants” and, together with the Series A Public Warrants, the “November 2024 Public Warrants”) to purchase up to an additional 836,045 Common Shares. Each Common Share was sold together with one Series A Public Warrant and one-half of one Series B Public Warrant at a combined public offering price of $1.57. The gross proceeds from the November 2024 Registered Offering were $2,501 before deducting underwriting discounts and offering expenses. The November 2024 Public Warrants were classified as equity instruments and accordingly, the net proceeds were allocated based on the relative fair values of the Common Shares and the November 2024 Public Warrants on the date of issuance, with $943 allocated to the fair value of the November 2024 Public Warrants and the balance of the proceeds of $1,558 allocated to Common Shares. The Company incurred total transaction costs related to the November 2024 Registered Offering $1,226, which were treated as share issuance costs at closing. The Series A Public Warrants have an exercise price of $1.75 per underlying Common Share, are exercisable immediately, and will expire on November 5, 2026. The Series B Public Warrants have an exercise price of $2.07 per underlying Common Share, are exercisable beginning six months and one day from the date of issuance and will expire on November 5, 2029. In addition, pursuant to the Underwriting Agreement, the Company granted Maxim a 45-day over-allotment option to purchase (i) 238,853 additional Common Shares and (ii) 358,280 Option Warrants (as defined below) to purchase up to an aggregate of 358,280 Common Shares. “Option Warrant” means one Series A Public Warrant combined with one-half of one Series B Public Warrant. On November 4, 2024, Maxim partially exercised its over-allotment option to purchase 79,734 additional Series A Public Warrants and 39,867 additional Series B Public Warrants, which amounts are included in the amounts discussed above and were issued at closing of the November 2024 Registered Offering. 71 NioCorp Developments Ltd. Notes to the Consolidated Financial Statements June 30, 2025 (expressed in thousands of U.S. dollars, except share and per share data or as otherwise stated) The following table discloses the primary inputs for the Black-Scholes model used in valuing the November 2024 Public Warrants: Schedule of Black-Scholes model used in public warrants November 5, 2024 November 2024 Public Warrants: Series A Public Warrants Series B Public Warrants Closing Common Share price $ 1.455 $ 1.455 Term (years) 4.5 2.0 Historic equity volatility 67.43 % 67.13 % Risk-free rate 4.14 % 4.20 % On November 13, 2024, the Company closed a non-brokered private placement (the “November 2024 Private Offering”), pursuant to binding subscription agreements with certain accredited investors as part of a non-brokered private placement of 2,199,602 units of the Company (the “November 2024 Units”). Each November 2024 Unit consisted of one Common Share, one Warrant (a “Series A Private Warrant”) to purchase one Common Share, and one-half of one Warrant (each whole such Warrant, a “Series B Private Warrant” and, together with the Series A Private Warrants, the “November 2024 Private Warrants”), with each Series B Private Warrant entitling the holder thereof to purchase one additional Common Share. Each November 2024 Unit was issued and sold at a price of $1.57. The gross proceeds of the November 2024 Private Offering were approximately $3,500 before deducting offering expenses. Certain directors and officers of the Company (the “Insider Investors”) purchased November 2024 Units at a price of $1.7675 per November 2024 Unit, which price includes $0.1975 per November 2024 Private Warrant and allowed such directors and officers to participate in the November 2024 Private Offering in accordance with the rules of the Nasdaq. The Series A Private Warrants have an exercise price of $1.75 per underlying Common Share, are exercisable immediately, and will expire on November 13, 2026. The Series B Private Warrants have an exercise price of $2.07 per underlying Common Share, are exercisable beginning six months and one day from the date of issuance and will expire on November 13, 2029. The Company recorded a non-cash expense of $34 and $110 to other operating expenses and employee related costs, respectively, representing the excess of fair value of the November 2024 Units over the purchase price paid by Insider Investors. Based upon the Company’s analysis of the criteria contained in ASC 815, the Company determined that the November 2024 Private Warrants met the definition of a derivative liability, as any Warrant exercise that could cause the holder to exceed 19.9% ownership of NioCorp Common Shares would require shareholder approval. As such, the November 2024 Private Warrants were recognized as warrant liabilities on the consolidated balance sheet and were measured at their issuance date fair value of $ 1,928 and subsequently remeasured at each reporting period with changes being recorded as a non-operating gain or loss in the consolidated statement of operations and comprehensive loss. The remaining proceeds of the November 2024 Private Offering of $ 1,573 were allocated to Common Shares. The Company incurred total transaction costs related to the November 2024 Private Offering of $ 161 , of which $ 60 was allocated to the November 2024 Private Warrants and was expensed at closing. The following tables disclose the primary inputs for the Black-Scholes model used in valuing the November 2024 Private Warrants: Schedule of Black-Scholes model used in Private warrants November 13, 2024 November 2024 Private Warrants: Series A Private Warrants Series B Private Warrants Closing Common Share price $ 1.49 $ 1.49 Term (years) 2.0 4.5 Historic equity volatility 67.26 % 67.52 % Risk-free rate 4.20 % 4.30 % 72 NioCorp Developments Ltd. Notes to the Consolidated Financial Statements June 30, 2025 (expressed in thousands of U.S. dollars, except share and per share data or as otherwise stated) June 30, 2025 November 2024 Private Warrants: Series A Private Warrants Series B Private Warrants Closing Common Share price $ 2.33 $ 2.33 Term (years) 1.37 4.38 Historic equity volatility 86.14 % 74.26 % Risk-free rate 3.88 % 3.77 % The following table sets forth a summary of the changes in the fair value of the November 2024 Private Warrants liabilities: Schedule of changes in the fair value of Private Warrants liabilities November 2024 Private Warrants Fair value at issuance (November 13, 2024) $ 1,929 Fair value of Warrants exercised ( 338 ) Change in fair value 2,240 Fair value as of June 30, 2025 $ 3,831 On January 31, 2025, the Company closed an underwritten registered direct offering (the “January 2025 Offering”), pursuant to an underwriting agreement, dated January 29, 2025, with Maxim, as underwriter, pursuant to which the Company issued and sold 2,577,320 Common Shares, 2,577,320 Series A Warrants to purchase up to 2,577,320 Common Shares (the “January 2025 Series A Warrants”) and 1,288,660 Series B Warrants to purchase up to an additional 1,288,660 Common Shares (the “January 2025 Series B Warrants” and, together with the January 2025 Series A Warrants, the “January 2025 Warrants”). Each Common Share was sold together with one January 2025 Series A Warrant and one-half of one January 2025 Series B Warrant at a combined public offering price of $1.94. The gross proceeds from the January 2025 Offering were approximately $5,000 before deducting underwriting discounts and offering expenses. The January 2025 Warrants were classified as equity instruments, and accordingly, the net proceeds were allocated based on the relative fair values of the Common Shares and the January 2025 Warrants on the date of issuance, with $2,200 allocated to the fair value of the January 2025 Warrants and the balance of the proceeds of $2,800 allocated to Common Shares. The Company incurred total transaction costs related to the January 2025 Offering of $799, which were treated as share issuance costs at closing. The January 2025 Series A Warrants have an exercise price of $1.98 per underlying Common Share, are exercisable immediately, and will expire on August 2, 2027. The January 2025 Series B Warrants have an exercise price of $2.05 per underlying Common Share, are exercisable immediately, and will expire on January 31, 2029. The following primary inputs were used in the Black-Scholes model for valuing the January 2025 Warrants: Schedule of Black-Scholes model for warrants Series A Public Warrants Series B Public Warrants Closing Common Share price $ 2.25 $ 2.25 Term (years) 2.5 4.0 Historic equity volatility 73.18 % 73.36 % Risk-free rate 4.23 % 4.31 % On April 21, 2025, the Company closed an underwritten public offering (the “April 2025 Offering”), pursuant to an underwriting agreement, dated April 17, 2025, with Maxim, as underwriter, pursuant to which the Company issued and sold (i) 6,628,846 Common Shares at a public offering price of $2.60 per Common Share and (ii) 1,063,462 pre-funded Warrants (the “April 2025 Pre-Funded Warrants”) to purchase up to an additional 1,063,462 Common Shares at a public offering price of $2.5999. The April 2025 Pre-Funded Warrants have an exercise price of $0.0001 per underlying Common Share, are exercisable immediately, and do not have an expiration date. On April 17, 2025, Maxim partially exercised its over-allotment option to purchase 323,504 additional Common Shares at closing. The gross proceeds from the April 2025 Offering were 73 NioCorp Developments Ltd. Notes to the Consolidated Financial Statements June 30, 2025 (expressed in thousands of U.S. dollars, except share and per share data or as otherwise stated) approximately $20,841 before deducting underwriting discounts and offering expenses. The April 2025 Pre-Funded Warrants were classified as equity instruments and accordingly, the net proceeds were allocated based on the relative fair values of the Common Shares and the April 2025 Pre-Funded Warrants on the date of issuance, with $2,765 allocated to the fair value of the April 2025 Pre-Funded Warrants (based on the value of the underlying Common Shares at closing) and the balance of the proceeds of $18,076 allocated to Common Shares. The Company incurred total transaction costs related to the April 2025 Offering of $2,102, which were treated as share issuance costs at closing. Fiscal Year 2024 Issuances On September 1, 2023, the Company closed a non-brokered private placement of units of the Company (the “September 2023 Units”). A total of 250,000 September 2023 Units were issued at a price per September 2023 Unit of $ 4.00 , for total gross proceeds to the Company of $ 1,000 . Each September 2023 Unit consists of one Common Share and one Warrant (“September 2023 Warrant”). Each September 2023 Warrant entitles the holder to acquire one Common Share at a price of $ 4.60 at any time prior to September 1, 2025. The September 2023 Warrants were classified as an equity instrument and accordingly, the net proceeds of $ 962 were allocated based on the relative fair values of the Common Shares and the September 2023 Warrants on the date of issuance. The amount allocated to the fair value of the September 2023 Warrants was $ 254 and the balance of the proceeds of $ 708 was allocated to the Common Shares. The fair value of the September 2023 Warrants issued was computed using the Black Scholes pricing model using the following assumptions: an expected life of 2.0 years, a risk-free interest rate of 4.85 % , an expected volatility of 71.63 % , and an expected dividend rate of 0 % . On December 22, 2023, the Company closed a non-brokered private placement (the “December 2023 Private Placement”) of 413,432 units of the Company (the “December 2023 Units”). Each December 2023 Unit consists of one Common Share and one Warrant (“December 2023 Warrant”). Each December 2023 Warrant entitles the holder to acquire one Common Share at a price of $ 3.54 at any time until December 22, 2025. 274,587 of the December 2023 Units were issued and sold to certain accredited investors, who are not affiliated with the Company but with whom the Company had a pre-existing relationship, at a price of $ 3.08 per December 2023 Unit, and 138,845 of the December 2023 Units were issued and sold to certain officers and directors of the Company (the “Insider Investors”), at a price of $ 3.205 per December 2023 Unit. The price per December 2023 Unit paid by the Insider Investors included $0.125 per December 2023 Warrant underlying each December 2023 Unit purchased by the Insider Investors which allowed the Insider Investors to participate in the December 2023 Private Placement in accordance with the rules of Nasdaq. The Company received aggregate gross proceeds from the December 2023 Private Placement of approximately $ 1,290 . The Company recorded a non-cash expense of $ 92 and $ 10 to other operating expense and employee related costs, respectively, representing the excess of fair value of the December 2023 Units over the purchase price paid by Insider Investors. The December 2023 Warrants were classified as an equity instrument and accordingly, the estimated net proceeds of $1,241 were allocated based on the relative fair values of the Common Shares and the December 2023 Warrants on the date of issuance. The amount allocated to the fair value of the December 2023 Warrants was $ 264 and the balance of the proceeds of $ 977 was allocated to the Common Shares. The fair value of the December 2023 Warrants issued was computed using the Black Scholes pricing model using the following assumptions: an expected life of 2.0 years, a risk-free interest rate of 4.33 % , an expected volatility of 54.8 % , and an expected dividend rate of 0 % . On June 24, 2024, the Company closed a non-brokered private placement of units of the Company (the “June 2024 Units”). A total of 315,000 June 2024 Units were issued at a price per June 2024 Unit of $ 1.91 , for total gross proceeds to the Company of $ 602 . Each June 2024 Unit consists of one Common Share and one Warrant (“June 2024 Warrant”). Each June 2024 Warrant entitles the holder to acquire one Common Share at a price of $ 2.20 at any time prior to June 24, 2026. 74 NioCorp Developments Ltd. Notes to the Consolidated Financial Statements June 30, 2025 (expressed in thousands of U.S. dollars, except share and per share data or as otherwise stated) The June 2024 Warrants were classified as an equity instrument and accordingly, the net proceeds of $602 were allocated based on the relative fair values of the Common Shares and the June 2024 Warrants on the date of issuance. The amount allocated to the fair value of the June 2024 Warrants was $ 161 and the balance of the proceeds of $ 441 was allocated to Common Shares. The fair value of the June 2024 Warrants issued was computed using the Black Scholes pricing model using the following assumptions: an expected life of 2.0 years, a risk-free interest rate of 4.73 % , an expected volatility of 73.92 % , and an expected dividend rate of 0 % . Yorkville Equity Facility Financing Agreement Issuances As of June 30, 2025, the Company has access to up to $ 46,917 in net proceeds from the Yorkville Equity Facility Financing Agreement. The Yorkville Equity Facility Financing Agreement expires on April 1, 2026 . The Company issued the following Common Shares under the Yorkville Equity Facility Financing Agreement during the periods presented below: Schedule of issued Common Shares under the Yorkville Equity Facility Financing Agreement For The Year Ended June 30, 2025 2024 Common Shares issued 5,671,742 1,358,000 Gross funds received $ 12,352 $ 3,293 Market value of Common Shares issued 12,941 3,398 Loss on issuance (1) $ 589 $ 105 (1) Loss on issuance represents a non-cash amount equal to the difference between the proceeds received and the fair value of the Common Shares issued based on the Nasdaq closing price per Common Share on the issuance date and is recorded in other operating expenses in the condensed consolidated statement of operations and comprehensive loss. b) Stock Options On January 19, 2024, the Company’s shareholders voted to approve an amendment and restatement of its long-term incentive plan (the “2017 Amended Long-Term Incentive Plan”) and the granting of incentive securities thereunder until January 19, 2027. Under the 2017 Amended Long-Term Incentive Plan, the Board may, in its discretion from time to time, grant Options and share units (in the form of restricted share units and performance share units), plus dividend equivalents, to non-employee directors, employees and certain other service providers (as described in the 2017 Amended Long-Term Incentive Plan) of the Company and affiliated entities selected by the Board. Subject to adjustment as described in the 2017 Amended Long-Term Incentive Plan, the aggregate number of Common Shares that may be reserved for issuance to participants under the 2017 Amended Long-Term Incentive Plan, together with all other security-based compensation arrangements of the Company, may not exceed 10% of the issued and outstanding Common Shares from time to time, and the Common Shares reserved for issuance upon settlement of share units will not exceed 5% of the issued and outstanding Common Shares from time to time. The 2017 Amended Long-Term Incentive Plan limits the maximum number of Common Shares issued to insiders (as defined under TSX rules for this purpose) within any 1-year period, or issuable to insiders at any time, in the aggregate, under all security-based compensation arrangements (including the 2017 Amended Long-Term Incentive Plan) to 10% of the then issued and outstanding Common Shares. The 2017 Amended Long-Term Incentive Plan also limits the aggregate number of Common Shares that may be reserved for issuance to any one participant under the 2017 Amended Long-Term Incentive Plan, together with all other security-based compensation arrangements of the Company, to 5% of the then issued and outstanding Common Shares (on a non-diluted basis). Subject to the adjustment provisions of the 2017 Amended Long-Term Incentive Plan, the aggregate number of Common Shares actually issued or transferred by the Company upon the exercise of Options will also be limited, as described in the 2017 Amended Long-Term Incentive Plan. The Board has power over the granting, amendment, administration, or settlement of any award. 75 NioCorp Developments Ltd. Notes to the Consolidated Financial Statements June 30, 2025 (expressed in thousands of U.S. dollars, except share and per share data or as otherwise stated) Option transactions are summarized as follows: Schedule of option Number of Options Weighted Average Exercise Price Aggregate Intrinsic Value Weighted Average Remaining Contractual Life Balance, June 30, 2023 1,541,500 $ 7.19 Granted 1,625,000 2.99 Exercised ( 7,800 ) 3.95 Cancelled/expired ( 663,200 ) 5.88 Balance, June 30, 2024 2,495,500 4.78 Granted 945,000 1.41 Exercised ( 512 ) 1.40 Cancelled/expired ( 419,988 ) 9.44 Balance, June 30, 2025 3,020,000 $ 3.09 $ 866 3.5 years As of June 30, 2025, 99.8 % of the outstanding Options were fully vested. The total intrinsic value of Options exercised during the year ended June 30, 2025 was nil, and as of June 30, 2025, there was $ 4 of unrecognized compensation costs related to unvested share-based compensation arrangements granted. The Company recognized share-based compensation expense of $ 789 and $ 2,779 for the years ended June 30, 2025 and 2024, respectively. The following table summarizes the weighted average information and assumptions used to determine Option costs: Schedule of weighted average and assumptions used to option costs For the year ended June 30, 2025 2024 Fair value per option granted during the period $ 0.84 $ 1.71 Risk-free interest rate 4.44 % 4.25 % Expected dividend yield 0 % 0 % Expected stock price volatility (historical basis) 67.3 % 63.2 % Expected option life in years 5.0 5.0 Prior to January 1, 2024, the Company concluded that under ASU 718, Compensation – Stock Compensation (Topic 718) , Options previously issued on December 31, 2021, May 30, 2022, and March 27, 2023, which included a C$ strike price (the “CAD Options”) should remain equity-classified as management determined that the Options qualified for an exemption from liability classification as the CAD Options were denominated in a currency in which a substantial portion of the Company’s equity securities traded. Effective January 1, 2024, the Company determined that due to historically decreasing trading volume on the TSX, this exemption no longer applied and accordingly, these CAD Options were classified as a liability based on their fair values on that date. The Company recorded a mark-to-market gain of $147 in other operating expenses related to these CAD Option liabilities for the year ended June 30, 2024. The CAD Options expired at various dates during the year ended June 30, 2025, with no further gains or losses recorded in other operating expenses. On March 28, 2024, the Board approved a modification to Options previously issued on March 27, 2023, with dual strike prices of $6.95 and C$9.52, under which the option to exercise in C$ was removed. No other terms or conditions were amended by the Board. Based on this amendment, the Company re-classified these Options to equity on March 28, 2024, based on their fair value on that date. c) Warrants Warrant transactions are summarized as follows. Weighted average exercise prices related to Canadian dollar denominated Warrants were converted to U.S. dollars using end of period foreign currency exchange rates. 76 NioCorp Developments Ltd. Notes to the Consolidated Financial Statements June 30, 2025 (expressed in thousands of U.S. dollars, except share and per share data or as otherwise stated) Schedule of Weighted average exercise prices Warrants Weighted Average Exercise Price Balance, June 30, 2023 18,816,304 $ 10.98 Granted 1,593,817 3.33 Expired ( 1,846,560 ) 8.67 Balance, June 30, 2024 18,563,561 10.53 Granted 13,553,714 2.05 Exercised ( 828,235 ) 1.78 Expired ( 1,303,118 ) 7.72 Balance, June 30, 2025 29,985,922 $ 7.06 At June 30, 2025, the Company has outstanding exercisable Warrants, as follows: Schedule of outstanding exercisable Warrants Number Exercise Price Expiry Date 250,000 $ 4.60 September 1, 2025 413,432 3.54 December 22, 2025 315,000 2.20 June 24, 2026 1,117,090 1.75 November 5, 2026 1,992,214 1.75 November 13, 2026 615,385 3.25 April 12, 2027 2,577,320 1.98 August 2, 2027 15,666,626 (1) 11.50 March 17, 2028 2,816,742 2.31 September 17, 2028 1,288,660 2.05 January 31, 2029 802,045 2.07 November 5, 2029 1,067,946 2.07 November 13, 2029 1,063,462 2.60 No expiry 29,985,922 (1) Includes 11,165,324 and 4,501,302 2023 Public Warrants and 2023 Private Warrants, respectively, as defined below. Each 2023 Public Warrant and 2023 Private Warrant is exercisable into 1.11829212 Common Shares. In connection with the Closing, pursuant to the Business Combination Agreement, the Company assumed GXII’s obligations under the agreement (the “GXII Warrant Agreement”) governing the GXII share purchase Warrants (the “GXII Warrants”) and each GXII Warrant thereunder that was issued and outstanding immediately prior to the Closing Date was converted into one Warrant to purchase 1.11829212 Common Shares (the “NioCorp Assumed Warrants”) pursuant to the GXII Warrant Agreement, as amended by an Assignment, Assumption and Amendment Agreement, dated March 17, 2023, among the Company, GXII, Continental Stock Transfer & Trust Company, as the existing warrant agent, and Computershare Inc. and its affiliate, Computershare Trust Company, N.A, together as the successor warrant agent (the “NioCorp Assumed Warrant Agreement”). In connection with the Closing, NioCorp issued (a) 9,999,959 public NioCorp Assumed Warrants (the “2023 Public Warrants”) in respect of the GXII Warrants that were publicly traded prior to the Closing and (b) 5,666,667 NioCorp Assumed Warrants (the “2023 Private Warrants”) 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. Each NioCorp Assumed Warrant entitles the holder to the right to purchase 1.11829212 Common Shares at an exercise price of $11.50 per 1.11829212 Common Shares (subject to adjustments for stock splits, stock dividends, reorganizations, recapitalizations and the like). No fractional shares will be issued upon exercise of any NioCorp Assumed Warrants, and fractional shares that would otherwise be due to the exercising holder will be rounded down to the nearest whole Common Share. In no event will the Company be required to net cash settle any NioCorp Assumed Warrant. 77 NioCorp Developments Ltd. Notes to the Consolidated Financial Statements June 30, 2025 (expressed in thousands of U.S. dollars, except share and per share data or as otherwise stated) 2023 Public Warrants The Company may elect to redeem the 2023 Public Warrants subject to certain conditions, in whole and not in part, at a price of $0.01 per 2023 Public Warrant if (i) 30 days’ prior written notice of redemption is provided to the holders, (ii) the last reported sale price of the Common Shares equals or exceeds approximately $16.10 per share (as adjusted for stock splits, stock dividends, reorganizations, recapitalizations and the like) for any 20 trading days within a 30-trading day period ending on the third business day prior to the date on which the Company sends the notice of redemption to the Warrant holders and (iii) there is an effective registration statement covering the Common Shares issuable upon exercise of the 2023 Public Warrants, and a current prospectus relating thereto, available through the redemption date. Upon issuance of a redemption notice by the Company, the Warrant holders will have until the redemption date to exercise for cash, or, at the Company’s election, on a cashless basis. 2023 Private Warrants The 2023 Private Warrants: (i) will be exercisable either for cash or on a cashless basis at the holder’s option and (ii) will not be redeemable by the Company, in either case as long as the 2023 Private Warrants are held by the initial purchasers or their permitted transferees. Any 2023 Private Warrants that are held by someone other than the initial purchasers or their permitted transferees are treated as 2023 Public Warrants. The Company accounts for the 2023 Private Warrants in accordance with the guidance contained in ASC 815-40. Such guidance provides that because the 2023 Private Warrants do not meet the criteria for equity treatment thereunder, the 2023 Private Warrants must be recorded as a liability. This liability is carried as a component of Warrant liabilities on the consolidated balance sheet and is subject to re-measurement at each balance sheet date. With each such re-measurement, the warrant liability will be adjusted to its current fair value, with the change in fair value recognized in the consolidated statement of operations and comprehensive loss. The Company will reassess the classification at each balance sheet date. As provided for in the NioCorp Assumed Warrant Agreement, through June 30, 2025, a total of 1,165,365 2023 Private Warrants were exchanged for 2023 Public Warrants. Upon exchange, the Company recorded an additional fair value expense of $26 and transferred the fair value of the exchanged 2023 Public Warrants from warrant liabilities to equity. The Company classifies the 2023 Private Warrants as Level 2 instruments under the fair value hierarchy and estimated the fair value using a Black Scholes model with the following assumptions: Schedule of Company classifies the 2023 Private Warrants Key Valuation Input June 30, 2025 June 30, 2024 Stock price on valuation date $ 2.33 $ 1.73 Strike price $ 11.50 $ 11.50 Implied volatility of the 2023 Public Warrants 90.0 % 69.0 % Risk free rate 3.70 % 4.45 % Dividend yield 0 % 0 % Expected Warrant life in years 2.7 3.7 The change in the 2023 Private Warrants liability is presented below: Schedule of change in the 2023 Private Warrants liability Amount Valuation at June 30, 2023 $ 3,279 Change in valuation ( 1,926 ) Valuation at June 30, 2024 1,353 Exchange of 2023 Private Warrants for 2023 Public Warrants ( 482 ) Change in valuation 1,661 Valuation at June 30, 2025 $ 2,532 78 NioCorp Developments Ltd. Notes to the Consolidated Financial Statements June 30, 2025 (expressed in thousands of U.S. dollars, except share and per share data or as otherwise stated) Contingent Consent Warrants As consideration for entering into the previously publicly disclosed Waiver and Consent Agreement, dated September 25, 2022 (the “Lind Consent”), between the Company and Lind Global Asset Management III, LLC (“Lind III”), Lind III received, amongst other things, the right to receive additional Warrants (the “Contingent Consent Warrants”) if on September 17, 2024, the closing trading price of the Common Shares on the Toronto Stock Exchange or such other stock exchange on which such shares may then be listed, is less than C$10.00, subject to adjustments. The number of Contingent Consent Warrants to be issued, if any, is based on the Canadian dollar equivalent (based on the then current Canadian to U.S. dollar exchange rate as reported by Bloomberg, L.P.) of $5,000 divided by the five-day volume weighted average price of the Common Shares on the date of issuance. Further, the number of Contingent Consent Warrants issued would be proportionately adjusted based on the percentage of Warrants currently held by Lind III that are exercised, if any, prior to the issuance of any Contingent Consent Warrants. On September 17, 2024, the Company’s Common Share price was below the threshold price set forth in the Lind Consent, and accordingly, the Company issued 2,816,742 Contingent Consent Warrants to Lind III. Each Contingent Consent Warrant is exercisable for one Common Share at an exercise price of $ 2.308 and may be exercised at any time prior to their expiration on September 17, 2028. The number of Contingent Consent Warrants issued was based on $ 5,000 divided by the five-day volume weighted average price of the Common Shares on September 16, 2024. The Company valued the Contingent Consent Warrants at $2,262 based on a Black-Scholes valuation with the following inputs: Schedule of Black-Scholes valuation Key Valuation Input September 17, 2024 Closing Common Share price $ 1.74 Term (years) 4.0 Historic equity volatility 67.14 % Risk-free rate 3.44 % The change in the fair value of the Contingent Consent Warrants liability is presented below: Schedule of change in fair value of Warrants liability Amount Valuation at June 30, 2024 $ 2,365 Fair value of Warrants issued ( 2,262 ) Gain on issuance of Warrants ( 103 ) Ending balance $ - The Company recognized a gain of $ 103 on the issuance of the Contingent Consent Warrants. This gain was recorded as a part of other gains in the condensed consolidated statements of operations and comprehensive loss. 11. RELATED PARTY TRANSACTIONS AND BALANCES On September 11, 2024, the Company and Mark Smith, Chief Executive Officer, President, and Executive Chairman of NioCorp, entered into a loan agreement (the “Smith Loan Agreement”), which provided for a $ 2,000 non-revolving, multi-draw credit facility (the “Smith Loan”). The Smith Loan had an interest rate of 10 % per annum, calculated monthly in arrears, through the date of repayment of the Smith Loan. The Company could pre-pay the Smith Loan at any time without notice and without penalty, but any amount of principal or interest repaid by the Company prior to the earlier of the date of expiration of the Smith Loan Agreement, on June 30, 2025, and the occurrence of an event of default under the Smith Loan Agreement was subject to an early payment fee of 2.5 % of the value of any such payment. The Smith Loan was secured by all of the Company’s assets pursuant to a general security agreement between the Company and Mr. Smith dated September 11, 2024. Through October 30, 2024, the Company borrowed a total of $ 504 under the Smith Loan and subsequently the Company repaid $508, representing the balance of interest and principal outstanding under the Smith Loan, together with $ 41 related to loan origination fees payable. As of June 30, 2025, there were no amounts outstanding under the Smith Loan. 79 NioCorp Developments Ltd. Notes to the Consolidated Financial Statements June 30, 2025 (expressed in thousands of U.S. dollars, except share and per share data or as otherwise stated) 12. EXPLORATION EXPENDITURES Schedule of exploration expenditures For the year ended June 30, 2025 2024 Feasibility study and engineering $ 1,112 $ 353 Field management and other 900 503 Drilling 1,456 - Metallurgical 214 1,678 Geologists and field staff 453 18 Total $ 4,135 $ 2,552 13. LEASES As of June 30, 2025 and 2024, the Company had one corporate office lease with a remaining lease term of 1.6 years as of June 30, 2025. During the year ended June 30, 2025 and 2024, operating cash flows included cash payments of $ 96 and $ 71 , respectively related to the measurement of lease liabilities. The Company incurred lease costs as follows: For the year ended June 30, 2025 2024 Fixed rent expense $ 94 $ 90 Variable rent expense 13 14 Short term lease cost 10 9 Sublease income ( 41 ) ( 32 ) Net lease cost – other operating expense $ 76 $ 81 The maturity of lease liabilities is as follows at June 30, 2025: Fiscal Year Lease Maturities 2026 $ 98 2027 50 Total lease payments 148 Less amount of payments representing interest ( 17 ) Present value of lease payments 131 Less current portion of operating lease liability ( 98 ) Noncurrent operating lease liability $ 33 14. INCOME TAXES Domestic and foreign components of loss before income taxes for the years ended June 30, 2025 and 2024 are as follows: For the year ended June 30, 2025 2024 Canada $ ( 13,089 ) $ ( 8,319 ) United States ( 4,818 ) ( 3,679 ) United Kingdom ( 75 ) ( 39 ) Total $ ( 17,982 ) $ ( 12,037 ) 80 NioCorp Developments Ltd. Notes to the Consolidated Financial Statements June 30, 2025 (expressed in thousands of U.S. dollars, except share and per share data or as otherwise stated) The following table is a reconciliation of income taxes at statutory rates: The following table is a reconciliation of income taxes at statutory rates: For the year ended June 30, 2025 2024 Loss before income taxes $ ( 17,982 ) $ ( 12,037 ) Income tax benefit at Canadian federal rate ( 2,697 ) ( 1,806 ) Income tax benefit at Canadian provincial rate ( 2,158 ) ( 1,444 ) Warrant liability 1,105 ( 506 ) Earnout shares liability 557 ( 1,810 ) Share based compensation 239 747 Foreign rate differential 102 62 Accretion expense 11 1,138 Change in estimates related to prior years - 160 Stock issuance costs in equity ( 1,143 ) ( 55 ) Convertible note valuation ( 137 ) 607 Other 143 50 Change in valuation allowance 3,978 2,718 Income tax benefit $ - $ 139 Income tax benefit for the year ended June 30, 2024, was derived solely from our U.S. operations. The Company acquired a federal income tax payable of $ 443 in connection with the GXII Transaction. As a result of a post-transaction loss at ECRC, a partial release of the valuation allowance attributed to the reduction of the acquired federal income tax payable of $139 was recorded as an income tax benefit in the consolidated statement of operations and comprehensive loss for the year ended June 30, 2024. Deferred income taxes reflect the net tax effects of temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for income tax purposes. The significant components of deferred taxes are as follows: As of June 30, 2025 2024 Deferred tax assets Net operating losses available for future periods $ 16,125 $ 14,177 Mineral interests 10,438 9,438 Startup and organizational costs 1,842 1,987 Research and development costs 1,295 1,419 Share issuance/financing costs 1,357 635 Canadian restricted interest and financing carryforward 605 - Capital losses available for future periods 456 456 Other 41 69 Total deferred tax assets 32,159 28,181 Valuation allowance ( 32,159 ) ( 28,181 ) Net deferred tax assets $ - $ - Changes in the valuation allowance are as follows: For the year ended June 30, 2025 2024 Valuation allowance, beginning of year $ ( 28,181 ) $ ( 25,463 ) Current year additions ( 3,978 ) ( 2,718 ) Valuation allowance, end of year $ ( 32,159 ) $ ( 28,181 ) The Company establishes a valuation allowance against future income tax assets if, based on available information, it is more likely than not that all of the assets will not be realized. The valuation allowance of $ 32,159 at June 30, 2025, relates mainly to net operating loss carryforwards in Canada and mineral interests due to deferred exploration expenditures in the United States, where the utilization of such attributes is not more likely than not. 81 NioCorp Developments Ltd. Notes to the Consolidated Financial Statements June 30, 2025 (expressed in thousands of U.S. dollars, except share and per share data or as otherwise stated) The Company has the following cumulative net operating losses for Canadian and U.S. Federal income tax purposes. Canadian tax loss carryforwards will generally expire between 2028 and 2045. U.S. tax losses incurred through June 30, 2018, totaled $ 981 and will generally expire between 2031 and 2038. As a result of the Tax Cuts and Jobs Act of 2017, U.S. tax losses incurred for our tax years ending on and after June 30, 2019, totaling $ 5,645 , have no expiration. Schedule of cumulative net operating losses As of June 30, Jurisdiction 2025 2024 Canada $ 53,194 $ 47,623 United States 6,627 4,905 United Kingdom 112 39 Total $ 59,933 $ 52,567 In addition, the Company has a Canadian capital loss carryforward of $ 3,378 as of June 30, 2025, which has no expiration date and can be used to offset future capital gains, and U.S. state net operating loss carryforwards of $ 8,742 as of June 30, 2025 which generally expire between 2031 and 2045. At June 30, 2025 and 2024, we had no undistributed earnings of foreign subsidiaries that would be subject to income tax upon distribution to Canada from a foreign subsidiary. As such, as of June 30, 2025 and 2024, we did not provide for deferred taxes on any such earnings of our foreign subsidiaries. The Company had no unrecognized tax benefits as of June 30, 2025 or 2024. The Company has not recognized any interest or penalties in the fiscal years presented in these consolidated financial statements. The Company is subject to income tax in the U.S. federal jurisdiction, the United Kingdom, and Canada. Certain years remain subject to examination but there are currently no ongoing exams in any taxing jurisdictions. On July 4, 2025, the One Big Beautiful Bill Act (“OBBBA”) was enacted in the U.S., which includes a broad range of tax reform provisions affecting businesses. The OBBBA includes numerous changes to existing tax law including extending or making permanent certain business and international tax measures initially established under the 2017 Tax Cuts and Jobs Act, which were set to expire. The OBBBA contains several changes to corporate taxation including modifications to capitalization of research and development expenses, modifications to deductions for interest expense, and accelerated depreciation on certain asset additions. As the legislation was signed into law after June 30, 2025, our operating results for the year ended June 30, 2025, do not include any adjustments related to the OBBBA, and the Company does not expect a material impact to our financial statements due to the enactment of the OBBBA. 15. Fair Value Measurements The Company measures the fair value of financial assets and liabilities based on U.S. GAAP guidance which defines fair value, establishes a framework for measuring fair value, and expands disclosures about fair value measurements. The Company classifies financial assets and liabilities as held-for-trading, available-for-sale, held-to-maturity, loans and receivables, or other financial liabilities depending on their nature. Financial assets and financial liabilities are recognized at fair value on their initial recognition. Financial assets and liabilities classified as held-for-trading are measured at fair value, with gains and losses recognized in net income. Financial assets classified as held-to-maturity, loans and receivables, and financial liabilities other than those classified as held-for-trading are measured at amortized cost, using the effective interest method of amortization. Financial assets classified as available-for-sale, including investments in equity securities, are measured at fair value, with unrealized gains and losses being recognized in income. Financial instruments including receivables, accounts payable and accrued liabilities, and related party loans are carried at amortized cost, which management believes approximates fair value due to the short-term nature of these instruments. The following tables present information about the assets and liabilities that are measured at fair value on a recurring basis as of June 30, 2025, and 2024, respectively, and indicate the fair value hierarchy of the valuation techniques the 82 NioCorp Developments Ltd. Notes to the Consolidated Financial Statements June 30, 2025 (expressed in thousands of U.S. dollars, except share and per share data or as otherwise stated) Company utilized to determine such fair value. In general, fair values determined by Level 1 inputs utilize quoted prices (unadjusted) in active markets for identical instruments. Fair values determined by Level 2 inputs utilize data points that are observable, such as quoted prices, interest rates, and yield curves. Fair values determined by Level 3 inputs are unobservable data points for the financial instrument and include situations where there is little, if any, market activity for the instrument. Schedule of fair values determined by level 3 inputs are unobservable data As of June 30, 2025 Total Level 1 Level 2 Level 3 Assets: Cash and cash equivalents $ 25,554 $ 25,554 $ - $ - Investment in equity securities 3 3 - - Total $ 25,557 $ 25,557 $ - $ - Liabilities: Earnout Shares liability $ 5,880 $ - $ - $ 5,880 Warrant liabilities 6,852 - 6,852 - Total $ 12,732 $ - $ 6,852 $ 5,880 As of June 30, 2024 Total Level 1 Level 2 Level 3 Assets: Cash and cash equivalents $ 2,012 $ 2,012 $ - $ - Investment in equity securities 4 4 - - Total $ 2,016 $ 2,016 $ - $ - Liabilities: April 2024 notes $ 7,089 $ - $ - $ 7,089 Earnout Shares liability 3,817 - - 3,817 Warrant liabilities 4,016 - 1,651 2,365 Total $ 14,922 $ - $ 1,651 $ 13,271 16. SEGMENT INFORMATION The Company has one reportable segment: the United States. The United States segment conducts exploration, development, and care and maintenance activities at the Elk Creek Project. This segment holds substantially all of the Company’s non-current assets and does not presently report any revenues from operations. Through this segment, the Company seeks to position the Elk Creek Project as a development opportunity in the strategic minerals sector. The Company’s chief operating decision maker is the Chief Executive Officer (“CODM”). Financial information and annual operating plans and forecasts are prepared and reviewed by the CODM at a consolidated level. The CODM assesses performance for the single operating segment and decides how to better allocate resources based on total operating expenses, net loss, changes in cash and cash equivalents, and cash and cash-equivalent balances that are reported on the Consolidated Statement of Operations and Consolidated Statement of Cash Flows. The Company’s objective in making resource allocation decisions is to optimize the Company’s ability to develop and operate the Elk Creek Project. In addition, the CODM reviews the segment’s assets based on total assets reported on the consolidated balance sheet, and the accounting policies of our single operating segment are the same as those described in the Summary of Significant Accounting Policies herein. For additional reportable single operating segment level financial information, see the Consolidated Financial Statements. 17. SUBSEQUENT EVENTS The July 2025 Offering On July 18, 2025, the Company closed a public offering (the “July 2025 Offering”), pursuant to which the Company issued and sold 13,850,000 Common Shares at a public offering price of $3.25 per Common Share, for net proceeds of approximately $41,762 after deducting placement agent fees discounts and prior to other offering expenses. Maxim 83 NioCorp Developments Ltd. Notes to the Consolidated Financial Statements June 30, 2025 (expressed in thousands of U.S. dollars, except share and per share data or as otherwise stated) acted as sole placement agent for the July 2025 Offering. The Company intends to use the net proceeds from the July 2025 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. Other Common Share Issuances During the period from July 1, 2025 through September 11, 2025, the Company issued 5,000,312 Common Shares through the exercise of Warrants and Options by their holders and received cash totaling approximately $ 10,401 . In addition, 415,581 Vested Shares were exchanged for an equivalent number of Common Shares. Purchases of Land On August 1, 2025, ECRC closed on its option to purchase three parcels of land in Johnson County, Nebraska (the “Property”), pursuant to the terms of the Option to Purchase, dated as of December 4, 2009, as amended, and the Option to Purchase, dated December 4, 2014, as amended, each between Roger and Nancy Woltemath (the “Owners”) and ECRC (together, the “Option Agreements”). Pursuant to the terms of the Option Agreements, the Owners sold, transferred, conveyed and assigned to ECRC all of their rights, privileges, title and interest in and to the surface rights with respect to one of the parcels (consisting of the property known as Woltemath80S) and to the surface rights and associated mineral rights with respect to the other two parcels (consisting of approximately 1.66 acres of the property known as Woltemath002). The Option Agreements provided for a purchase price calculated based on the appraised value per acre of the parcels of land. The aggregate purchase price was approximately $ 2,700 . DoD Agreement On August 4, 2025, ECRC entered into a Project Sub-Agreement (the “DoD Agreement”) with Advanced Technology International (“ATI”), an entity acting on behalf of the Defense Industrial Base Consortium under the authority of the U.S. Department of Defense (“DoD”). Subject to the terms and conditions of the DoD Agreement, ECRC is entitled to receive up to an aggregate of approximately $ 10.0 million of reimbursement payments from the DoD upon the achievement of certain project milestones related to feasibility study-level engineering and additional reserve drilling, as well as preparing updated cost estimates, for the Elk Creek Project. 84 ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE. None.