ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
The following discussion and analysis should be read in conjunction with our historical interim condensed consolidated financial statements and related notes included elsewhere in this Quarterly Report on Form 10-Q and the Annual Report on Form 10-K filed with the Securities and Exchange Commission (the “SEC”) for the year ended June 30, 2025 filed on September 11, 2025 (the “Annual Report on Form 10-K”), which have been prepared in accordance with generally accepted accounting principles in the United States (“U.S. GAAP”). The Company uses certain non-GAAP financial measures. For a detailed description of each of the non-GAAP measures used herein, please refer to the discussion under “—Use of Non-GAAP Financial Measures and Reconciliations.”
This discussion and analysis contains forward-looking statements and forward-looking information that involve risks, uncertainties, and assumptions. Our actual results may differ materially from those anticipated in these forward-looking statements and information as a result of many factors, including, but not limited to, those set forth elsewhere in this Quarterly Report on Form 10-Q. See “—Note Regarding Forward-Looking Statements” below.
All currency amounts are stated in thousands of U.S. dollars, except for share data ,unless noted otherwise.
As used in this Quarterly Report on Form 10-Q, unless the context otherwise indicates, references to “we,” “our,” the “Company,” “NioCorp,” and “us” refer to NioCorp Developments Ltd. and its subsidiaries, collectively.
Note Regarding Forward-Looking Statements
This Quarterly Report on Form 10-Q and the exhibits attached hereto contain “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended (the “Securities Act”), and Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), and “forward-looking information” within the meaning of applicable Canadian securities legislation (collectively, “forward-looking statements”). Such forward-looking statements concern our anticipated results and developments in the operations of the Company in future periods, planned exploration activities, the adequacy of the Company’s financial resources, and other events or conditions that may occur in the future.
Forward-looking statements have been based upon our current business and operating plans, as approved by the Board, and may include statements regarding, among other matters, the financial and business performance of NioCorp; NioCorp’s anticipated results and developments in the operations of NioCorp in future periods; NioCorp’s planned exploration activities; the adequacy of NioCorp’s financial resources; NioCorp’s ability to secure sufficient project financing to complete construction and commence operation of the Company’s niobium, scandium, and titanium project (the “Elk Creek Project”) located in southeastern Nebraska; NioCorp’s ability to receive a final commitment of financing from the Export-Import Bank of the United States (“EXIM”); the estimated timing and capital costs of the Portal Project (as defined below); the estimated total upfront capital expenditure for the Elk Creek Project; NioCorp’s expectation and ability to produce niobium, scandium, and titanium and the potential to produce rare earth elements at the Elk Creek Project; NioCorp’s plans to produce and supply specific products and market demand for those products; NioCorp’s ability to access the full amount of the expected net proceeds of 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”); NioCorp’s expectation that it will receive the full $10.0 million in reimbursement under the DoD Agreement (as defined below); the intended use of our cash balance as of December 31, 2025 as well as the proceeds from the October 2025 Offering (as defined below), the proceeds from the exercise of Common Share purchase warrants (“Warrants”) and the reimbursement payments pursuant to the DoD Agreement; the expected results of the 2025 Drilling Program (as defined below) at the Elk Creek Project; the expectation that the results of the 2025 Drilling Program will be used to update the feasibility study for the Elk Creek Project; the Elk Creek Project’s ability to produce multiple critical metals; the Elk Creek Project’s projected ore production and mining operations over its expected mine life; the completion of technical and economic analyses on the potential addition of magnetic rare earth oxides to NioCorp’s planned product suite; statements with respect to the estimation of mineral resources and mineral reserves; the exercise of options to purchase additional land parcels; the execution of contracts with engineering, procurement and construction companies; the duration and anticipated benefits of the Rights Plan (as defined below); NioCorp’s ongoing evaluation of the impact of inflation, supply chain issues, tariffs, and geopolitical unrest on the Elk Creek Project’s economic model; and the creation of full-time and contract construction jobs over the construction period of the Elk Creek Project.
Forward-looking statements are frequently, but not always, identified by words such as “expects,” “anticipates,” “believes,” “intends,” “estimates,” “potential,” “possible,” and similar expressions, or statements that events, conditions, or results “will,”
“may,” “could,” or “should” (or the negative and grammatical variations of any of these terms) occur or be achieved. Any statements that express or involve discussions with respect to predictions, expectations, beliefs, plans, projections, objectives, assumptions, or future events or performance (often, but not always, using words or phrases such as “expects” or “does not expect,” “is expected,” “anticipates” or “does not anticipate,” “plans,” “estimates,” or “intends,” or stating that certain actions, events, or results “may,” “could,” “would,” “might,” or “will” be taken, occur or be achieved) are not statements of historical fact and may be forward-looking statements. Forward-looking statements reflect material expectations and assumptions, including, without limitation, expectations and assumptions relating to: NioCorp’s ability to receive sufficient project financing for the construction of the Elk Creek Project on acceptable terms, or at all; the future price of and demand for metals, including aluminum-scandium("Al-Sc") alloy; and the stability of the financial and capital markets. Such forward-looking statements reflect the Company’s current views with respect to future events and are subject to certain known and unknown risks, uncertainties, and assumptions. Many factors could cause actual results, performance, or achievements to be materially different from any future results, performance, or achievements that may be expressed or implied by such forward-looking statements, including, among others, risks related to the following: NioCorp’s requirement of significant additional capital; NioCorp’s ability to receive sufficient project financing for the construction of the Elk Creek Project on acceptable terms, or at all; NioCorp’s ability to achieve the required milestones and receive the full $10.0 million in reimbursement under the DoD Agreement; NioCorp’s ability to receive a final commitment of financing from EXIM or other debt financing or financial support on acceptable timelines, on acceptable terms, or at all; NioCorp’s ability to access the full amount of the expected net proceeds under the Yorkville Equity Facility Financing Agreement; NioCorp’s ability to continue to meet Nasdaq listing standards; risks relating to the common shares, no par value, of the Company (“Common Shares”), including price volatility, lack of dividend payments and dilution or the perception of the likelihood of any of the foregoing; the extent to which NioCorp’s level of indebtedness and/or the terms contained in agreements governing NioCorp’s indebtedness, if any, the Yorkville Equity Facility Financing Agreement or other agreements may impair NioCorp’s ability to obtain additional financing, on acceptable terms, or at all; covenants contained in agreements with NioCorp’s secured creditors that may affect its assets; NioCorp’s limited operating history; NioCorp’s history of losses; the material weaknesses in NioCorp’s internal control over financial reporting, NioCorp’s efforts to remediate such material weaknesses and the timing of remediation; the possibility that NioCorp may qualify as a “passive foreign investment company (“PFIC”) under the Internal Revenue Code of 1986, as amended (the “Code”); the potential that the 2023 Transactions could result in NioCorp becoming subject to materially adverse U.S. federal income tax consequences as a result of the application of Section 7874 and related sections of the Code; cost increases for NioCorp’s exploration and, if warranted, development projects; a disruption in, or failure of, NioCorp’s information technology systems, including those related to cybersecurity; equipment and supply shortages; variations in the market demand for, and prices of, niobium, scandium, titanium and rare earth products; current and future offtake agreements, joint ventures, and partnerships, including our ability to negotiate extensions to existing agreements or to enter into new agreements, on favorable terms or at all; NioCorp’s ability to attract qualified management; estimates of mineral resources and reserves; mineral exploration and production activities; feasibility study results; the results of metallurgical testing; the results of technological research; changes in demand for and price of commodities (such as fuel and electricity) and currencies; competition in the mining industry; changes or disruptions in the securities markets; legislative, political or economic developments, including changes in federal and/or state laws that may significantly affect the mining and scandium alloy industries; trade policies and tensions, including tariffs; inflationary pressures; the impacts of climate change, as well as actions taken or required by governments related to strengthening resilience in the face of potential impacts from climate change; the need to obtain permits and comply with laws and regulations and other regulatory requirements; the timing and reliability of sampling and assay data; the possibility that actual results of work may differ from projections/expectations or may not realize the perceived potential of NioCorp’s projects; risks of accidents, equipment breakdowns, and labor disputes or other unanticipated difficulties or interruptions; the possibility of cost overruns or unanticipated expenses in development programs; operating or technical difficulties in connection with exploration, mining, development, or scandium alloy production activities; management of the water balance at the Elk Creek Project site; land reclamation requirements related to the Elk Creek Project; the speculative nature of mineral exploration and development, including the risks of diminishing quantities of grades of reserves and resources; claims on the title to NioCorp’s properties; the infringement or loss of NioCorp's intellectual property rights; potential future litigation; and NioCorp’s lack of insurance covering all of NioCorp’s operations.
Should one or more of these risks or uncertainties materialize, or should underlying assumptions prove incorrect, actual results may vary materially from those described herein. This list is not exhaustive of the factors that may affect any of the Company’s forward-looking statements. Forward-looking statements are statements about the future and are inherently uncertain, and actual achievements of the Company or other future events or conditions may differ materially from those reflected in the forward-looking statements due to a variety of risks, uncertainties, and other factors, including without limitation those discussed under the heading “Risk Factors” in our Annual Report on Form 10-K, as well as other factors described elsewhere in this Quarterly Report on Form 10-Q and the Company’s other reports filed with the SEC.
The Company’s forward-looking statements contained in this Quarterly Report on Form 10-Q are based on the beliefs, expectations, and opinions of management as of the date of this Quarterly Report on Form 10-Q. The Company does not assume
any obligation to update forward-looking statements if circumstances or management’s beliefs, expectations, or opinions should change, except as required by law. For the reasons set forth above, investors should not attribute undue certainty to, or place undue reliance on, forward-looking statements.
Qualified Person
All technical and scientific information that forms the basis for the Elk Creek Project disclosure included in this Quarterly Report on Form 10-Q has been reviewed and approved by Scott Honan, M.Sc., SME-RM, NioCorp’s Chief Operating Officer. Mr. Honan is a “Qualified Person” as such term is defined in National Instrument 43-101 – Standards of Disclosure for Mineral Projects and subpart 1300 of Regulation S-K.
Company Overview
NioCorp is developing the Elk Creek Project, located in southeast Nebraska. The Elk Creek Project is a development-stage property that has disclosed niobium, scandium, and titanium reserves and resources and disclosed rare earth mineral resources. The Company is continuing technical and economic studies around the rare earths contained in the Elk Creek Project’s mineral resources in order to determine whether extraction of rare earth elements can be reasonably justified and economically viable after taking into account all relevant factors. Niobium has developing applications in the formulation of solid-state lithium-ion batteries, which may reduce charging times and increase battery safety. Niobium is used to produce various superalloys that are extensively used in high performance aircraft and jet turbines. It also is used in High-Strength, Low-Alloy steel, a stronger steel used in automobiles, bridges, structural systems, buildings, pipelines, and other applications that generally increases strength and/or reduces weight, which can result in environmental benefits, including reduced fuel consumption and material usage and fewer air emissions. Scandium can be combined with aluminum to make high-performance alloys with increased strength and improved corrosion resistance. Scandium also is a critical component of advanced solid oxide fuel cells, an environmentally preferred technology for high-reliability, distributed electricity generation. Titanium is a component of various superalloys and other applications that are used for aerospace applications, weapons systems, protective armor, medical implants, and many others. It also is used in pigments for paper, paint, and plastics. Rare earths are critical to electrification and decarbonization initiatives and can be used to manufacture the strongest permanent magnets commercially available. In December 2025, the Company acquired certain manufacturing assets and intellectual property related to Al-Sc alloy production, which are intended to support a potential future domestic scandium supply chain, subject to financing and development
Our primary business strategy is to advance our Elk Creek Project to commercial production. We are focused on carrying out our near-term planned work programs associated with securing the project financing package necessary to complete mine development and construction of the Elk Creek Project.
Recent Corporate Events
On October 15, 2025, the Company issued and sold (a) 10,152,175 Common shares at an offering price of $9.34 per Common Share and (b) 5,925,000 pre-funded Warrants (the “October Pre-Funded Warrants”) to purchase up to an additional 5,925,000 Common Shares at an offering price of $9.3399 per October Pre-Funded Warrant in a registered offering (the “October 2025 Offering”) under the Company's registration statement on Form S-3 (Registration No. 333-290837), pursuant to the Placement Agency Agreement between the Company and Maxim, dated October 13, 2025. On October 17, 2025, the Company issued 5,924,942 Common Shares in connection with the cashless exercise of all of the outstanding October Pre-Funded Warrants. The Company received net proceeds from the October 2025 Offering, after deducting placement agent fees and other offering expenses payable by the Company, of approximately $139.1 million. The Company intends to use the net proceeds from the October 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.
On November 21, 2025, the Company adopted a limited-duration shareholder rights plan (the “Rights Plan”). One right (a “Right”) was issued for each Common Share outstanding as of December 4, 2025, and a Right automatically attaches to each subsequently issued Common Share until the expiration of the Rights Plan. The Rights generally become exercisable only if a person or group acquires or announces the current intention of commencing a take-over bid to acquire beneficial ownership of 20% or more of the Company’s outstanding Common Shares other than through a permitted bid made in compliance with applicable Canadian take-over bid rules. If the Rights become exercisable, each holder of a Right, other than the acquiring person, would be entitled to purchase additional Common Shares at a discount to the then-current market price.
The Board adopted the Rights Plan to help ensure that all shareholders of the Company are treated equally and fairly in the event of any unsolicited take-over bid or other attempt to acquire control of the Company (including by way of a "creeping take-over bid"). In respect of such transactions, the Rights Plan is intended to, among other things:
•encourage potential bidders to treat the Company's shareholders fairly and equally and preserve control premiums and value for shareholders; and
•provide the Board and shareholders adequate time to appropriately respond on an informed basis.
The Rights Plan was not adopted in response to any specific take-over proposal. The Plan expires on May 21, 2026, or earlier as provided by the terms of the agreement governing the Rights Plan.
On December 4, 2025, the Company, through its newly-formed subsidiary, NioCorp Advanced Metals and Alloys, LLC, completed the acquisition of the manufacturing assets and intellectual property of FEA Materials LLC for $8.4 million in cash. The acquired assets include equipment and proprietary technology used to produce Al-Sc master alloy through an innovative process that converts scandium oxide directly into Al-Sc master alloy, eliminating the need to first manufacture scandium metal. This technology is expected to meaningfully reduce processing complexity and cost relative to traditional methods. The acquisition strengthens the Company’s downstream commercialization strategy by potentially enabling the future production of Al-Sc master alloy in the United States, subject to completion and financing of the Elk Creek Project.
Elk Creek Project Update
On August 1, 2025, Elk Creek Resources Corp. (“ECRC”), an indirect, majority-owned subsidiary of the Company, closed on its option to purchase three parcels of land in Johnson County, Nebraska, pursuant to the terms of an Option to Purchase dated December 4, 2009, as amended (the “2009 Option Agreement”), and an Option to Purchase dated December 4, 2014, as amended (together with the 2009 Option Agreement, the “August Option Agreements”). Pursuant to the terms of the August Option Agreements, ECRC acquired all surface rights with respect to an approximately 80-acre parcel and both surface and associated mineral rights with respect two additional parcels totaling approximately 1.66 acres. The aggregate purchase price was approximately $2.7 million, including indirect costs of $35.
On September 8, 2025, the Company announced the successful completion of its previously announced drilling program at the Elk Creek Project (the “2025 Drilling Program”). The 2025 Drilling Program was divided into two phases. Phase I of the 2025 Drilling Program comprised 11 HQ diamond drill holes totaling approximately 7,339 meters and Phase II of the 2025 Drilling Program comprised four HQ diamond drill holes totaling approximately 2,235 meters. Two additional geomechanical drill holes totaling approximately 1,950 meters were also completed as part of an accelerated effort to support the underground mine design related to access ramp development. Assays of the drill holes completed during the 2025 Drilling Program are underway at external laboratories.
The 2025 Drilling Program and associated technical work was designed to support the conversion of a portion of the Elk Creek Project's Indicated Mineral Resources into Measured Mineral Resources and the subsequent conversion of a portion of its Probable Mineral Reserves into Proven Mineral Reserves and to help meet Mineral Resource and Mineral Reserve classification requirements associated with the ongoing review of the Company's application for up to $800 million in potential debt financing by EXIM, as further discussed under “—Liquidity and Capital Resources.”
On September 30, 2025, ECRC closed on its options to purchase two additional parcels of land in Johnson County, Nebraska (the “September Properties”), pursuant to the terms of the 2009 Option Agreement and an Amended and Restated Option to Purchase dated January 4, 2017, as amended (together with the 2009 Option Agreement, the “September Option Agreements”). The September Properties consisted of approximately 325.77 acres of land. Pursuant to the terms of the September Option Agreements, ECRC acquired all surface rights and associated mineral rights relating to the September Properties. The aggregate purchase price was approximately $11.3 million, including indirect costs of $29.
On November 7, 2025, ECRC completed the acquisition of a 40-acre parcel of land and associated mineral rights (the “November Property”) located within the one-square-mile section that comprises the Elk Creek Project area. The acquisition was completed in exchange for (i) the transfer of surface rights to a separate 40-acre tract constituting a portion of the September Properties, which lies outside the Elk Creek Project section, (ii) cash consideration of $500, and (iii) the grant of a 2% net smelter return royalty on the November Property. As a result of this transaction, the Company now holds full ownership of all surface rights within the one-square-mile section in which it plans to construct both the underground critical minerals mine and integrated surface processing facility associated with the Elk Creek Project.
On December 22, 2025, the Board approved the Company’s Mine Portal Project (the “Portal Project”), at the Elk Creek Project site. The Portal Project will establish the main entrances to the Elk Creek Project underground mine, which will serve as the primary access points for personnel, equipment, and materials for the Company’s planned underground mining operations. The Board-approved scope also includes excavating to bedrock, drilling and blasting to establish the twin mine ramps, on-site access
road construction, as well as on-site supporting infrastructure. Work with respect to the Portal Project is expected to begin in the first quarter of calendar year 2026. The current estimated capital cost for the project is approximately $44.6 million; however, there can be no assurance that the actual capital cost of the Portal Project will not be materially greater than such estimate.
Other Activities
The Company continues to execute a work plan to further advance the development of the Elk Creek Project. In addition to the expected updates to Mineral Resources and Mineral Reserves, noted above, the Company expects to finalize engineering and costing of its new and more efficient production process which incorporates the potential addition of magnetic rare earth products and the planned production of titanium in the form of titanium tetrachloride. In addition, the Company is advancing engineering to modify the design of the mine to incorporate a twin ramp for access along with a Railveyor system for material movement instead of utilizing vertical mining shafts. The updated mine design will also incorporate updated costing. This work is expected to be summarized in an updated feasibility study for the Elk Creek Project.
In addition to the work plans noted above, as funds become available through the Company’s fundraising efforts, the Company expects to undertake the following activities to further advance the Elk Creek Project and the Company is assessing and prioritizing the timing of these efforts:
•Continued evaluation of the potential to produce rare earth products and sell such products under offtake agreements;
•Negotiation and completion of offtake agreements for the remaining uncommitted production of niobium, scandium, and titanium from the Elk Creek Project, including the potential sale of titanium as titanium tetrachloride, as well as potential rare earth element production;
•Negotiation and completion of engineering, procurement, and construction agreements;
•Hiring of personnel to manage the Company’s responsibilities for construction and operations;
•Completion of the final detailed engineering for the underground portion of the Elk Creek Project;
•Completion of the final detailed engineering for surface project facilities;
•Construction of natural gas and electrical infrastructure to serve the Elk Creek Project site;
•Completion of water supply agreements and related infrastructure to deliver fresh water to the Elk Creek Project site;
•Completion of mine groundwater investigation and control activities;
•Initiation of long-lead equipment procurement activities;
•Continuation of the Company’s efforts to secure additional federal, state, and local operating permits;
•Completion of the characterization and testing of waste materials to support tailings impoundment and paste backfill plant designs; and
•Initiation of road improvements near the junction of Nebraska state highways 50 and 62, which are intended to facilitate access to the Elk Creek Project site and manage prospective increased traffic in the project vicinity.
Financial and Operating Results
The Company has no revenues from mining operations. Operating expenses incurred primarily related to costs incurred for the advancement of the Elk Creek Project and the activities necessary to support corporate and shareholder duties and are detailed in the following table.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
For the Three Months Ended December 31, |
|
|
For the Six Months Ended December 31, |
|
|
|
2025 |
|
|
2024 |
|
|
2025 |
|
|
2024 |
|
Operating expenses |
|
|
|
|
|
|
|
|
|
|
|
|
Employee related costs |
|
$ |
1,291 |
|
|
$ |
904 |
|
|
$ |
3,507 |
|
|
$ |
1,234 |
|
Professional fees |
|
|
1,313 |
|
|
|
772 |
|
|
|
2,188 |
|
|
|
1,222 |
|
Exploration expenditures |
|
|
4,632 |
|
|
|
261 |
|
|
|
11,716 |
|
|
|
399 |
|
Other operating expenses |
|
|
2,266 |
|
|
|
964 |
|
|
|
4,109 |
|
|
|
1,441 |
|
Total operating expenses |
|
|
9,502 |
|
|
|
2,901 |
|
|
|
21,520 |
|
|
|
4,296 |
|
Change in fair value of earnout shares liability |
|
|
(4,189 |
) |
|
|
(1,569 |
) |
|
|
10,307 |
|
|
|
(753 |
) |
Change in fair value of warrant liabilities |
|
|
(1,732 |
) |
|
|
(837 |
) |
|
|
15,826 |
|
|
|
(893 |
) |
Change in fair value of convertible notes |
|
|
— |
|
|
|
23 |
|
|
|
— |
|
|
|
40 |
|
Interest expense |
|
|
— |
|
|
|
4 |
|
|
|
— |
|
|
|
48 |
|
Foreign exchange (gain) loss |
|
|
8 |
|
|
|
(4 |
) |
|
|
3 |
|
|
|
4 |
|
Interest income |
|
|
(2,384 |
) |
|
|
— |
|
|
|
(2,944 |
) |
|
|
— |
|
Other gains |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
(122 |
) |
Income tax benefit |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
Less: Net loss attributable to redeemable noncontrolling interest |
|
|
(582 |
) |
|
|
(68 |
) |
|
|
(1,430 |
) |
|
|
(99 |
) |
Net loss and comprehensive loss attributable to the Company |
|
$ |
(623 |
) |
|
$ |
(450 |
) |
|
$ |
(43,282 |
) |
|
$ |
(2,521 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
Net loss per common share, basic and diluted |
|
$ |
— |
|
|
$ |
(0.01 |
) |
|
$ |
(0.44 |
) |
|
$ |
(0.06 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted net loss |
|
$ |
(5,479 |
) |
|
$ |
(1,871 |
) |
|
$ |
(13,781 |
) |
|
$ |
(3,286 |
) |
Adjusted net loss per share |
|
|
(0.04 |
) |
|
|
(0.05 |
) |
|
|
(0.13 |
) |
|
|
(0.08 |
) |
Three-month period ended December 31, 2025 compared to the three-month period ended December 31, 2024
Significant items affecting operating expenses are noted below:
Employee-related expenditures increased for the three-month period in 2025 as compared to 2024 primarily due to the timing of grants of options to purchase Common Shares ("Options") issued to employees in 2025 and the hiring of additional corporate staffing.
Professional fees increased for the three-month period in 2025 as compared to 2024 primarily due to higher legal costs incurred in connection with the preparation of the Company’s SEC registration statements filed in October 2025.
Exploration expenditures increased for the three-month period in 2025 as compared to 2024, primarily due to costs associated with the Company's current efforts to update the Elk Creek Project feasibility study.
Other operating expenses include costs related to investor relations, general office expenses, shareholder services and proxy related activities, board-related expenditures, and other miscellaneous items. These costs increased for the three-month period in 2025 as compared to 2024 primarily due the timing of Option grants issued to board members and advisors, as well as higher investor-facing service costs.
Other significant items impacting the change in the Company’s net loss and net loss per share are noted below:
Change in fair value of earnout shares liability represents the impact of changes in fair value related to shares of Class B common stock of ECRC, the rights of the holders of which to exchange such shares into Common Shares are subject to certain vesting conditions (such shares of ECRC Class B common stock, the "Earnout Shares"). The decline in fair value
for the three-month period in 2025 as compared to 2024 primarily reflect the decrease in the Company’s Common Share price in the financial modeling used to determine the period end fair value.
Change in fair value of warrant liabilities represents the impact of changes in fair value of Warrants recorded as liabilities in the condensed consolidated balance sheet. The declines in fair value for the three-month period in 2025 as compared to 2024 primarily reflect decreases in the Company’s Common Share price used in the Black-Scholes valuation of outstanding Warrant liabilities. In addition, the 2025 decline was partially offset by additional fair value expense recognized in connection with Warrants exercised during the period.
Interest income represents earnings from the investment of excess cash balances in a commercial money market account. The increase for the three-month period in 2025 as compared to 2024 is attributable to our higher cash balance resulting from our successful financing efforts during calendar year 2025.
Loss attributable to noncontrolling interest represents the portion of net loss in ECRC not owned by the Company. The increase in loss for the three-month period in 2025 as compared to 2024 is related to the increased exploration expenditures, as noted above, incurred by ECRC.
Adjusted net loss increased for the three-month period in 2025, as compared to 2024, primarily due to the increase in exploration expenditures, as noted above, incurred by ECRC. Adjusted net loss per share declined slightly due to the impact of additional Common Share issuances in 2025.
Six-month period ended December 31, 2025 compared to the six-month period ended December 31, 2024
Except as noted below, the discussion of significant variances for the three-month period also explains the majority of changes for the six-month period, including with respect to net loss and net loss per share for the six-month period ended December 31, 2025:
Exploration expenditures increased for the six-month period in 2025 as compared to 2024, primarily due to field-based costs associated with the 2025 Drilling Program, which was substantially completed by September 30, 2025, as well as expenses related to the Company’s ongoing efforts to update the Elk Creek Project feasibility study.
Change in fair value of earnout shares liability and change in fair value of warrant liabilities both increased for the six-month period ended December 31, 2025, as compared to 2024, reflecting the effect of an increase in the Company’s Common Share price on the financial modeling results for each of these liabilities.
Adjusted net loss and adjusted net loss per share both increased for the six-month period in 2025, as compared to 2024, primarily due to the increase in exploration expenditures, as noted above, incurred by ECRC.
Liquidity and Capital Resources
We have no revenue generating operations from which we can internally generate funds. To date, our ongoing operations have been financed by the sale of our equity securities by way of public and private offerings, convertible securities issuances, the exercise of Options and Warrants, and related party loans. With respect to currently outstanding Options and Warrants, we believe that exercise of these instruments, and cash proceeds from such exercises, will not occur unless and until the market price for our Common Shares equals or exceeds the related exercise price of each instrument.
As discussed above under “—Recent Corporate Events”, the Company closed the October 2025 Offering with net proceeds of approximately $139.1 million, after deducting placement agency fees and other offering expenses payable by the Company. In addition, during the three-month period ended December 31, 2025, the Company issued an aggregate of 3,957,822 Common Shares through the exercise of Warrants and Options by their holders and advances under the Yorkville Equity Facility Financing Agreement, for which the Company received proceeds totaling approximately $14.6 million. During the period from January 1, 2026 to February 6, 2026, the Company issued an aggregate of 4,527,662 Common Shares through advances under the Yorkville Equity Facility Financing Agreement, for which the Company received proceeds totaling approximately $31.1 million. The Company expects to use these net proceeds for working capital and general corporate purposes, including to advance efforts to launch construction of the Elk Creek Project and move it to commercial operation.
As of December 31, 2025, the Company had cash of $306.4 million and working capital of $297.9 million, compared to cash of $25.6 million and working capital of $24.8 million on June 30, 2025.
We expect that the Company will operate at a loss for the foreseeable future. The Company’s current planned cash outflows are approximately $70.0 million to $85.0 million for the next twelve months. Our planned cash outflows over the next twelve months are expected to consist of expenditures relating to limited, incremental activities to advance certain aspects of the Elk Creek Project by ECRC, corporate overhead costs, and estimated costs related to securing financing necessary for advancement of the Elk Creek Project. These planned expenditures include expenditures relating to the anticipated completion of an updated resource and reserve estimate and associated mine plan and an updated capital cost estimate in connection with the EXIM application process, infrastructure development, ongoing engineering and metallurgical test work, environmental and permitting activities, community and stakeholder engagement programs, corporate and administrative overhead, and advisory costs related to securing project financing.
The Company will need to secure additional capital to finance construction and achieve commercial production to support its long-term business objectives. Until sufficient funding for construction is secured, the Company expects to continue advancement activities related to the Elk Creek Project, including incremental engineering and limited underground portal-related work, while maintaining project readiness efforts. The Company also intends to evaluate strategies and potential investment opportunities that could reduce overall project costs, capital requirements, or execution risk.
The planned corporate overhead costs over the next twelve months are approximately $12.0 million, including Elk Creek property lease commitments, which are $54 through June 30, 2026, and the settlement of outstanding accounts payable as of December 31, 2025.
The estimated financing costs associated with the Elk Creek Project over the next twelve months include, but are not limited to, costs relating to the EXIM application process, the scope of which remains under discussion with EXIM. On June 6, 2023, the Company announced that it had submitted an application to EXIM for up to $800 million in debt financing (the “EXIM Financing”) to fund the project costs for the Elk Creek Project, under EXIM’s “Make More in America” initiative. The EXIM Financing is subject to, among other matters, the satisfactory completion of due diligence, the negotiation and settlement of final terms, and the negotiation of definitive documentation. The Company was informed that its application received approval by the first of three reviews by the EXIM Transaction Review Committee (the “TRC”) on October 2, 2023. In April 2024, EXIM provided the Company with a preliminary, non-binding indicative term sheet as part of a Preliminary Project Letter (the “PPL”), which also conveyed EXIM’s initial due diligence findings on the Company’s application for the EXIM Financing. The PPL identified additional project activities to be undertaken by the Company as part of EXIM’s due diligence process. These included, among other things, an updated mine plan and updated Elk Creek Project capital costs on a final or close-to-final basis reflecting updated process flows. The 2025 Drilling Program, which started in April 2025 and completed in September 2025, was designed to help meet mineral resource and mineral reserve classification requirements necessary to complete certain of the additional project activities identified by the PPL. In addition, as previously disclosed, the Company took an additional step in the process by executing a professional services agreement with SLR Consulting to conduct an independent environmental and social review as part of EXIM’s ongoing project due diligence.
The Company continues to meet with EXIM, provide responses to requests for additional information from EXIM and to the consultants that are conducting due diligence on the Company’s application on behalf of EXIM and take steps to complete the additional project activities identified by the PPL. There can be no assurance as to what further project activities or matters EXIM may request in connection with the application process. We are currently unable to estimate how long the application process may take, and there can be no assurances that we will be able to successfully negotiate a final commitment of debt financing from EXIM.
We expect our cash balance as of December 31, 2025, as well as the proceeds from Warrant and Option exercises and advances under the Yorkville Equity Facility Financing Agreement that occurred since December 31, 2025, and the reimbursement payments pursuant to the DoD Agreement, to be sufficient to fund our planned expenditures for the next twelve months. However, additional work is required in order to advance the Elk Creek Project to construction, requiring additional financing. The technical report summary for the Elk Creek Project prepared in accordance with subpart 1300 of Regulation S-K (“S-K 1300”) and filed as Exhibit 96.1 to the Company’s Annual Report on Form 10-K for the fiscal year ended June 30, 2025, includes an estimated total upfront capital expenditure for the Elk Creek Project of approximately $1,141.0 million. The actual amount of capital expenditure required to successfully achieve commercial production at the Elk Creek Project is subject to, among other factors, the timing and actual cost of further exploration, preparing feasibility studies, permitting, engineering and the construction of infrastructure, mining and processing facilities. In addition, to the extent that EXIM requests further project activities to be undertaken in connection with the diligence process, the Company would require additional funding to complete such activities. As noted above, the Company’s ability to continue operations, fund our current work plan, and construct and operate the Elk Creek Project is dependent on management’s ability to secure additional financing. When available, the Yorkville Equity Facility Financing Agreement provides an opportunity for opportunistic share sales to help fund our current work plan. However, the Yorkville Equity Facility Financing Agreement will expire by its terms on April 1, 2026.
Except for the potential funding from advances under the Yorkville Equity Facility Financing Agreement, as discussed above, and the potential exercise of Options and Warrants, we currently have no further funding commitments or arrangements for additional financing at this time. Management currently anticipates that it will fund the upfront capital expenditure amount for the Elk Creek Project through a combination of debt and equity financing, with approximately two-thirds of such amount being funded from the net proceeds of debt financing, including the amount of debt that would be represented by the EXIM Financing, if any. Management is actively pursuing additional sources of debt and equity financing to meet its long-term funding requirements, and while it has been successful in doing so in the past, there is no assurance that we will be able to obtain any such additional financing on acceptable terms, if at all. Pursuant to the Exchange Agreement, dated as of March 17, 2023 (as amended, supplemented or otherwise modified, the “Exchange Agreement”), by and among NioCorp, ECRC and GX Sponsor II LLC, NioCorp is restricted from issuing equity or equity-linked securities (other than Common Shares) or any preferred equity or non-voting equity if such issuance would adversely impact the rights of the holders of the shares of Class B common stock of ECRC, without the consent of the holders of a majority of the shares of Class B common stock of ECRC. Notwithstanding the restrictions set forth in the Exchange Agreement, there is significant uncertainty that we would be able to secure any additional financing in the current equity or debt markets. The quantity of funds to be raised and the terms of any proposed equity or debt financing that may be undertaken will be negotiated by management as opportunities to raise funds arise. Management may pursue funding sources of both debt and equity financing, including but not limited to the issuance of equity securities in the form of Common Shares, Warrants, subscription receipts, or any combination thereof in units of the Company pursuant to private placements to accredited investors or pursuant to public offerings in the form of underwritten/brokered offerings, registered direct offerings, or other forms of equity financing and public or private issuances of debt securities, including secured and unsecured convertible debt instruments, or secured debt project financing. Management does not currently know the terms pursuant to which such financings may be completed in the future, but any such financings will be negotiated at arm’s-length. Future financings involving the issuance of equity securities or derivatives thereof will likely be completed at a discount to the then-current market price of the Company’s securities and will likely be dilutive to current shareholders. In addition, we could raise funds through the sale of interests in our mineral properties, although current market conditions and other recent worldwide events have substantially reduced the number of potential buyers/acquirers of any such interests. However, we cannot provide any assurances that we will be able to be successful in raising such funds.
As defined under S-K 1300, we are a development stage issuer and we have incurred losses since our inception. The Company will require additional capital to meet its long-term operating requirements. Uncertainty in capital markets, supply chain disruptions, increased interest rates and inflation, and the potential for geographic recessions have contributed to general global economic uncertainty. During the three-month period ended December 31, 2025, these events continued to create uncertainty with respect to overall project funding and timelines. The Company will need to secure additional capital to finance construction and achieve commercial production to support its long-term business objectives.
We have no exposure to any asset-backed commercial paper. Other than cash held by our subsidiaries for their immediate operating needs in Colorado and Nebraska, all of our cash reserves are on deposit with major U.S. and Canadian chartered banks. We do not believe that the credit, liquidity, or market risks with respect thereto have increased as a result of the current market conditions. However, in order to achieve greater security for the preservation of our capital, we have, of necessity, been required to accept lower rates of interest, which has also lowered our potential interest income.
Operating Activities
During the six months ended December 31, 2025, the Company’s operating activities consumed $7.6 million of cash (2024: $2.0 million). The cash used in operating activities for the six months ended December 31, 2025, reflects the Company’s funding of losses of $44.7 million, primarily resulting from increased fair value related to the Earnout Shares and Warrant liabilities, share-based compensation, and other non-cash transactions. Overall, operational outflows during the six months ended December 31, 2025, increased from the corresponding period of 2024 due to costs and expenditures incurred in connection with the 2025 Drilling Program and the Company's current efforts to update the Elk Creek Project feasibility study. Going forward, the Company’s working capital requirements are expected to increase substantially in connection with the development of the Elk Creek Project.
Investing Activities
During the six months ended December 31, 2025, the Company’s investing activities consumed $23.0 million of cash (2024: $0). The cash used in investing activities for the six months ended December 31, 2025, reflects the acquisition of additional land and mineral rights for the Elk Creek Project as well as the acquisition of the manufacturing assets and intellectual property of FEA Materials LLC.
Financing Activities
Financing inflows were $311.3 million during the six months ended December 31, 2025 (2024: $0.5 million), with 2025 inflows reflecting the gross receipts of $305.2 million from the equity offerings, and $29.6 million from Warrant and Option exercises and advances under the Yorkville Equity Facility Financing Agreement, offset by $23.5 million of share issuance costs.
Cash Flow Considerations
The Company has historically relied upon debt and equity financings to finance its activities. Subject to the restrictions set forth in the Exchange Agreement, the Company may pursue additional debt and/or equity financing in the medium term; however, there can be no assurance the Company will be able to obtain any required financing in the future on acceptable terms, or at all.
The Company has limited financial resources compared to its proposed expenditures, no source of operating income, and no assurance that additional funding will be available to it for current or future projects, although the Company has been successful in the past in financing its activities through the sale of equity securities.
The ability of the Company to arrange additional financing in the future will depend, in part, on the prevailing capital markets conditions, and its success in developing the Elk Creek Project. Any quoted market for the Common Shares may be subject to market trends generally, notwithstanding any potential success of the Company in creating revenue, cash flows, or earnings, and any depression of the trading price of the Common Shares could impact its ability to obtain equity financing on acceptable terms.
Historically, the Company has used net proceeds from issuances of Common Shares to provide sufficient funds to meet its near-term exploration and development plans and other contractual obligations when due. However, development and construction of the Elk Creek Project will require substantial additional capital resources. This includes funding for Elk Creek Project construction and other costs. See “—Liquidity and Capital Resources” above for the Company’s discussion of arrangements related to possible future financings.
Critical Accounting Estimates
There have been no material changes in our critical accounting estimates discussed in “Management’s Discussion and Analysis of Financial Condition and Results of Operations” under the heading “Critical Accounting Estimates and Recent Accounting Pronouncements” as of June 30, 2025, in the Annual Report on Form 10-K, other than the addition of critical accounting estimates related to the valuation and impairment assessment of goodwill and identifiable intangible assets recognized in the current period.
Use of Non-GAAP Financial Measures and Reconciliations
The Company has included certain non-GAAP financial measures in this Quarterly Report on Form 10-Q such as adjusted net loss and adjusted net loss per share. Adjusted net loss for presentation purposes is our net loss attributable to the Company plus non-cash items plus (gain)/loss on non-recurring items. Adjusted net loss per share is the impact of these adjustments on the per share net losses incurred. These non-GAAP measures are intended to provide additional information and should not be considered in isolation or as a substitute for measures of performance prepared in accordance U.S. GAAP. Because these non-GAAP performance measures do not have any standardized meaning prescribed by U.S. GAAP, they may not be comparable to similar measures presented by other companies. The Company’s management believes that presenting adjusted net loss and adjusted net loss per share provides investors with additional insight into underlying operating performance by excluding the non-cash gains and losses noted above. Our presentation of certain non-GAAP financial measures should not be construed to imply that our future results will be unaffected by the types of items excluded from the calculations of non-GAAP measures. These non-GAAP measures are not presented in accordance with U.S. GAAP and the use of these terms vary from others in our industry.
Reconciliations of net loss attributable to the Company to adjusted net loss and net loss per share attributable to the Company to adjusted net loss per share are presented below:
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|
|
|
|
|
|
|
|
|
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|
|
For the Three Months Ended December 31, |
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|
For the Six Months Ended December 31, |
|
|
|
2025 |
|
|
2024 |
|
|
2025 |
|
|
2024 |
|
Net loss attributable to the Company |
|
$ |
(623 |
) |
|
$ |
(450 |
) |
|
$ |
(43,282 |
) |
|
$ |
(2,521 |
) |
Adjustments: |
|
|
|
|
|
|
|
|
|
|
|
|
Change in fair value of earnout liability |
|
|
(4,189 |
) |
|
|
(1,569 |
) |
|
|
10,307 |
|
|
|
(753 |
) |
Change in fair value of warrant liability |
|
|
(1,732 |
) |
|
|
(837 |
) |
|
|
15,826 |
|
|
|
(893 |
) |
Share based compensation |
|
|
784 |
|
|
|
781 |
|
|
|
3,086 |
|
|
|
781 |
|
Non-recurring gains |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
(122 |
) |
Other non-cash adjustments |
|
|
281 |
|
|
|
204 |
|
|
|
282 |
|
|
|
222 |
|
Adjusted net loss |
|
$ |
(5,479 |
) |
|
$ |
(1,871 |
) |
|
$ |
(13,781 |
) |
|
$ |
(3,286 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
Net loss per share attributable to the Company |
|
$ |
— |
|
|
$ |
(0.01 |
) |
|
$ |
(0.44 |
) |
|
$ |
(0.06 |
) |
Adjustments: |
|
|
|
|
|
|
|
|
|
|
|
|
Change in fair value of earnout liability |
|
|
(0.04 |
) |
|
|
(0.04 |
) |
|
|
0.11 |
|
|
|
(0.02 |
) |
Change in fair value of warrant liability |
|
|
(0.01 |
) |
|
|
(0.02 |
) |
|
|
0.17 |
|
|
|
(0.02 |
) |
Share based compensation |
|
|
0.01 |
|
|
|
0.02 |
|
|
|
0.03 |
|
|
|
0.02 |
|
Non-recurring gains |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
Other non-cash adjustments |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
Adjusted net loss per share |
|
$ |
(0.04 |
) |
|
$ |
(0.05 |
) |
|
$ |
(0.13 |
) |
|
$ |
(0.08 |
) |
Certain U.S. Federal Income Tax Considerations
If NioCorp (or a subsidiary) is a PFIC for any taxable year (or portion thereof) that is included in the holding period of a U.S. holder of Common Shares or other NioCorp securities (as determined under applicable U.S. federal income tax law), then certain significant adverse tax consequences could apply to such U.S. holder, including requirements to treat any gain realized upon a disposition of Common Shares (or other securities) as ordinary income, to include certain “excess distributions” on Common Shares in income, and to pay an interest charge on a portion of any such gain or distribution. NioCorp believes that it was classified as a PFIC during the taxable years ended June 30, 2025 and 2024, and, based on the current composition of its income and assets, as well as current business plans and financial expectations, that it may be classified as a PFIC for its current taxable year or in future taxable years. No opinion of legal counsel or ruling from the Internal Revenue Service (the “IRS”) concerning the PFIC status of NioCorp or any subsidiary has been obtained or is currently planned to be requested. The determination of whether any corporation was, or will be, a PFIC for a taxable year depends, in part, on the application of complex U.S. federal income tax rules, which are subject to differing interpretations. In addition, whether any corporation will be a PFIC for any taxable year depends on the assets and income of such corporation over the course of each such taxable year and, as a result, cannot be predicted with certainty as of the date of this Quarterly Report on Form 10-Q. In addition, even if NioCorp concluded that it or any subsidiary was not classified as a PFIC, the IRS could challenge such determination and a court could sustain the challenge. Accordingly, there can be no assurance that NioCorp or any subsidiary will not be classified as a PFIC for any taxable year. Each holder of Common Shares or other NioCorp securities should consult its own tax advisors regarding the PFIC status of NioCorp and each subsidiary thereof and the resulting tax consequences to the holder, as well as any potential to mitigate such tax consequences through a “QEF” or “mark-to-market” election. See the “Risk Factors” section of the Annual Report on Form 10-K.
Other
The Company has one class of shares, being Common Shares. A summary of outstanding Common Shares, Options, and Warrants as of February 6, 2026, is set out below, on a fully diluted basis.
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Common Shares
Outstanding |
|
|
|
(Fully Diluted) |
|
Common Shares |
|
|
125,321,172 |
|
Vested shares of ECRC Class B common stock (1) |
|
|
3,516,140 |
|
Options (2) |
|
|
4,852,500 |
|
Warrants (3) |
|
|
19,108,037 |
|
(1)Each exchangeable into one Common Share at any time, and from time to time, until March 17, 2033.
(2)Each exercisable into one Common Share.
(3)Includes 15,666,526 NioCorp Assumed Warrants that are each exercisable into 1.11829212 Common Shares and 3,441,511 Warrants that are each exercisable into one Common Share.
ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
Interest rate risk
The Company’s exposure to changes in market interest rates relates primarily to the Company’s earned interest income on cash deposits and short-term investments. The Company maintains a balance between the liquidity of cash assets and the interest rate return thereon. The carrying amount of financial assets, net of any provisions for losses, represents the Company’s maximum exposure to credit risk.
Foreign currency exchange risk
The Company incurs expenditures in both U.S. dollars and Canadian dollars. Canadian dollar expenditures are primarily related to certain Common Share-related costs and corporate professional services. As a result, currency exchange fluctuations may impact the costs of our operating activities. To reduce this risk, we maintain sufficient cash balances in Canadian dollars to fund expected near-term expenditures.
Commodity price risk
The Company is exposed to commodity price risk related to the elements associated with the Elk Creek Project. A significant decrease in the global demand for these elements may have a material adverse effect on our business. The Elk Creek Project is not in production, and the Company does not currently hold any commodity derivative positions.
ITEM 4. CONTROLS AND PROCEDURES
Disclosure Controls and Procedures
The management of NioCorp Developments Ltd. has evaluated, under the supervision of and with the participation of the Chief Executive Officer (“CEO”) and the Chief Financial Officer (“CFO”), the effectiveness of our disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act) as of December 31, 2025. Based on that evaluation, the CEO and the CFO have concluded that, as of December 31, 2025, our disclosure controls and procedures were not effective due to the material weaknesses in internal control over financial reporting described below.
Notwithstanding the material weaknesses in our internal control over financial reporting, our CEO and CFO have concluded that the interim condensed consolidated financial statements included in this Quarterly Report on Form 10-Q fairly present, in all material respects, our financial position, results of operations and cash flows for the periods presented in conformity with U.S. GAAP.
Material Weaknesses in Internal Control over Financial Reporting Existing as of December 31, 2025
The management of NioCorp Developments Ltd. is responsible for establishing and maintaining adequate internal control over financial reporting as defined in Rules 13a-15(f) and 15d-15(f) of the Exchange Act for the Company. Management assessed the effectiveness of our internal control over financial reporting as of December 31, 2025. In making this assessment, our management used the criteria set forth in the Internal Control - Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission (the “COSO Framework”). Based on that evaluation, the CEO and the
CFO have concluded that, as of December 31, 2025, our internal control over financial reporting was not effective due to the material weaknesses in internal control over financial reporting described below.
Material Weaknesses
A material weakness is a deficiency, or a combination of deficiencies, in internal control over financial reporting, such that there is a reasonable possibility that a material misstatement of our annual or interim consolidated financial statements will not be prevented or detected on a timely basis.
Management concluded that the material weaknesses disclosed in the Company’s Annual Report on Form 10-K for the fiscal year ended June 30, 2025, continued to exist as of December 31, 2025. Specifically, management identified deficiencies in the principles associated with the control environment, risk assessment, control activities, and monitoring components of internal control, based on the criteria established by the COSO Framework, that constitute material weaknesses, either individually or in the aggregate.
•Control Environment: The Company does not have sufficient personnel with the appropriate levels of knowledge, experience, and training in accounting and internal control over financial reporting commensurate with the complexity of the Company’s financing transactions and associated reporting requirements. This material weakness contributed to additional material weaknesses further described below.
•Risk Assessment: The Company does not have a formal process to identify, update, and assess financial reporting risks due to changes in the Company’s business practices, including entering into increasingly complex transactions that could significantly impact the design and operation of the Company’s control activities.
•Control Activities: Management did not maintain effective controls over:
omonitoring and assessing the work of third-party specialists, including the evaluation of the appropriateness of accounting conclusions,
othe evaluation of certain inputs and assumptions used to estimate the fair value of instruments and features associated with complex debt and equity transactions, and
othe design and implementation of effective process-level control activities related to vendor banking information.
•Monitoring Activities: Management did not appropriately:
oselect, develop, and perform ongoing evaluation to ascertain whether the components of internal controls are present and functioning, and
oevaluate and communicate internal control deficiencies in a timely manner to those parties responsible for taking corrective action.
As previously disclosed, these material weaknesses resulted in errors that required the restatement of Company’s consolidated financial statements as of and for the fiscal years ended June 30, 2022 and 2021, as well as the restatement of the Company’s condensed consolidated financial statements as of and for the interim periods ended September 30, 2021, December 31, 2021, March 31, 2022, September 30, 2022, and December 31, 2022. Additionally, these material weaknesses could result in a misstatement of the account balances or disclosures that would result in a material misstatement to the annual or interim consolidated financial statements that would not be prevented or timely detected.
Remediation Plan for the Material Weaknesses
To address our material weaknesses existing as of December 31, 2025, we have implemented and continue to develop a remediation plan to address each individual material weakness identified. While these remediation efforts are ongoing and the material weaknesses continue to exist, management has taken measured steps to strengthen the Company’s internal control environment. These actions include the following:
•We have engaged, and will continue to engage, outside accounting and internal control consultants with relevant expertise to supplement internal resources.
•We have developed a formal risk assessment process requiring periodic review and updates of current risks, internal controls, and financial reporting risks, and the results of this process are reviewed with management and periodically communicated to the Audit Committee.
•We have hired additional personnel to support accounting, finance, and internal control oversight functions.
•We have initiated the implementation of certain systems and tools intended to enhance financial reporting processes and internal controls, including enterprise accounting and financial reporting software and an initial training plan to provide incremental training to accounting and finance personnel. These initiatives are in the early stages of implementation and related controls have not yet operated for a sufficient period of time to conclude on their effectiveness.
•Management has advanced the development of a monitoring program to support the evaluation of whether controls are designed and, as implemented, are operating as intended such that there is contemporaneous evidence that the components of internal control are present and functioning and to communicate internal control deficiencies in a timely manner to those responsible for remediation.
The process of designing and maintaining effective internal control over financial reporting is a continuous effort that requires management to anticipate and react to changes in our business, economic, and regulatory environments and to expend significant resources. As we continue to evaluate our internal control over financial reporting, we may take additional actions to remediate the material weaknesses or modify the remediation actions described above.
While we continue to devote significant time and attention to these remediation efforts, the material weaknesses will not be considered remediated until management completes the design and implementation of the actions described above and the controls operate for a sufficient period of time, and management has concluded, through testing, that these controls are effective.
Changes in Internal Control over Financial Reporting
Other than as discussed above, there has been no change in our internal control over financial reporting during the quarter ended December 31, 2025, that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.
PART II — OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS
We know of no material, active, or pending legal proceedings against the Company, nor are we involved as a plaintiff in any material proceeding or pending litigation. There are no proceedings in which any of our directors, officers, or affiliates, or any registered or beneficial shareholder, is an adverse party or has a material interest adverse to our interest.
ITEM 1A. RISK FACTORS
You should carefully consider the risk factors discussed in Item 1A, “Risk Factors,” in the Company’s Annual Report on Form 10-K for the fiscal year ended June 30, 2025, which could materially affect the Company’s business, financial condition or future results.
The information set forth in this Quarterly Report on Form 10-Q, including without limitation, the risk factors presented below, updates and should be read in conjunction with, the risk factors and information disclosed in the Company’s Annual Report on Form 10-K for the fiscal year ended June 30, 2025.
Updates to the feasibility study for the Elk Creek Project may result in material changes in mineral resource/reserve estimates and grades of mineralization, and may affect the economic viability of the Elk Creek Project and its anticipated return on capital, which could have a material adverse effect on our ability to obtain sufficient financing for the Elk Creek Project, our ability to execute our business plan and our Common Share price.
As previously disclosed, the Company continues to execute a work plan to update the feasibility study for the Elk Creek Project, which is expected to incorporate, among other matters, (i) a new and more efficient production process; (ii) the potential addition of magnetic rare earth products and the planned production of titanium in the form of titanium tetrachloride; (iii) an
updated mine design; (iv) updated capital expenditure and operating cost estimates, which could be materially higher than those included in the S-K 1300 Elk Creek Technical Report Summary; and (v) and updated product pricing. These updates to the feasibility study may result in material changes in mineral resource/reserve estimates and grades of mineralization and may affect the economic viability of the Elk Creek Project and its anticipated return on capital, which could have a material adverse effect on our ability to obtain sufficient financing for the Elk Creek Project, our ability to execute our business plan and our Common Share price.
Mineral resource/reserve estimates may require adjustments or downward revisions. In addition, the grade of ore ultimately mined, if any, may differ from that indicated by our feasibility studies and drill results. The mineral resource and mineral reserve estimates included in the S-K 1300 Elk Creek Technical Report Summary and contained in our Annual Report on Form 10-K for the fiscal year ended June 30, 2025 have been, and mineral resource and mineral reserve estimates to be included in the updated feasibility study will be, determined based on assumed future prices, cut-off grades, and operating costs that may prove to be inaccurate. Extended declines in market prices for our products may render portions of our resource/reserve estimates uneconomic and may result in reduced reported resources/reserves or may adversely affect any economic viability determinations we may reach. Any material reductions in estimates of resources/reserves could have a material adverse effect on our Common Share price and on the value of our properties.
ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS
Recent Sales of Unregistered Securities
The Company issued and sold the following Common Shares in reliance on Section 4(a)(2) of the Securities Act in connection with the closing of advances under the Yorkville Equity Facility Financing Agreement and based upon representations and warranties of Yorkville in connection therewith:
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Date |
|
Gross Proceeds |
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|
Shares Issued |
|
|
Price/Share |
|
December 10, 2025 |
|
$ |
7,563.7 |
|
|
|
1,200,000 |
|
|
$ |
6.3031 |
|
ITEM 3. DEFAULTS UPON SENIOR SECURITIES
None.
ITEM 4. MINE SAFETY DISCLOSURES
Pursuant to Section 1503(a) of the Dodd-Frank Act, issuers that are operators, or that have a subsidiary that is an operator, of a coal or other mine in the United States are required to disclose specified information about mine health and safety in their periodic reports. These reporting requirements are based on the safety and health requirements applicable to mines under the Federal Mine Safety and Health Act of 1977 (the “Mine Act”) which is administered by the U.S. Department of Labor’s Mine Safety and Health Administration (“MSHA”). During the three-month period ended December 31, 2025, the Company and its subsidiaries and their properties or operations were not subject to regulation by MSHA under the Mine Act and thus no disclosure is required under Section 1503(a) of the Dodd-Frank Act.
ITEM 5. OTHER INFORMATION
Rule 10b5-1 Trading Arrangements
During the quarter ended December 31, 2025, no director or officer (as defined in Rule 16a-1(f) promulgated under the Exchange Act) of the Company adopted or terminated a “Rule 10b5-1 trading arrangement” or “non-Rule 10b5-1 trading arrangement” (as each term is defined in Item 408 of Regulation S-K).
ITEM 6. EXHIBITS
|
|
|
Exhibit No. |
|
Title |
2.1(1)*,** |
|
Asset Purchase Agreement, dated as of December 4, 2025, by and among NioCorp Advanced Metals and Alloys, LLC, FEA Materials LLC and each member of FEA Materials LLC party thereto |
3.1(2) |
|
Notice of Articles dated April 5, 2016 |
3.2(2) |
|
Articles, as amended, effective as of January 27, 2015 |
3.3(3) |
|
Amendment to Articles, effective March 17, 2023 |
|
|
|
4.1(4) |
|
Placement Agency Agreement, dated as of October 13, 2025, by and between NioCorp Developments Ltd. and Maxim Group LLC |
4.2(4) |
|
Form of October Pre-Funded Warrant (included in Exhibit 4.1) |
4.3(5) |
|
Shareholder Rights Plan Agreement, dated as of November 21, 2025, between NioCorp Developments Ltd. and Computershare Investor Services Inc. |
31.1 |
|
Certification of Chief Executive Officer pursuant to Exchange Act Rules 13a-14(a) and 15d-14(a), as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 |
31.2 |
|
Certification of Chief Financial Officer pursuant to Exchange Act Rules 13a-14(a) and 15d-14(a), as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 |
32.1 |
|
Certification of the Chief Executive Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 |
32.2 |
|
Certification of the Chief Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 |
101.INS(6) |
|
Inline XBRL Instance Document |
101.SCH(6) |
|
Inline XBRL Taxonomy Extension Schema With Embedded Linkbase Documents |
104 |
|
Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101) |
* Portions of this exhibit have been omitted pursuant to Item 601(b)(10)(iv) of Regulation S-K, which portions will be furnished to the Securities and Exchange Commission upon request.
** Certain exhibits to this agreement have been omitted pursuant to Item 601(a)(5) of Regulation S-K. A copy of any omitted exhibit will be furnished to the Securities and Exchange Commission upon request.
(1) Previously filed as an exhibit to the Company’s Current Report on Form 8-K (File No. 001-41655) filed with the SEC on December 4, 2025, and incorporated herein by reference.
(2) Previously filed as an exhibit to the Company’s Draft Registration Statement on Form S-1 (Registration No. 377-01354) submitted to the SEC on July 26, 2016, and incorporated herein by reference.
(3) Previously filed as an exhibit to the Company’s Current Report on Form 8-K (File No. 001-41655) filed with the SEC on March 17, 2023, and incorporated herein by reference.
(4) Previously filed as an exhibit to the Company’s Current Report on Form 8-K (File No. 001-41655) filed with the SEC on October 15, 2025, and incorporated herein by reference.
(5) Previously filed as an exhibit to the Company’s Current Report on Form 8-K (File No. 001-41655) filed with the SEC on November 21, 2025, and incorporated herein by reference.
(6) Submitted Electronically Herewith. Attached as Exhibit 101 to this report are the following formatted in inline XBRL (Extensible Business Reporting Language): (i) the Interim Condensed Consolidated Balance Sheets as of December 31, 2025 and June 30, 2025, (ii) the Interim Condensed Consolidated Statements of Operations and Comprehensive Loss for the Three and Six Months ended December 31, 2025 and 2024, (iii) the Interim Condensed Consolidated Statements of Cash Flows for the Six Months ended December 31, 2025 and 2024, (iv) the Interim Condensed Consolidated Statements of Shareholders’ Equity and Redeemable Noncontrolling Interest for the Three and Six Months ended December 31, 2025 and 2024 and (v) the Notes to the Interim Condensed Consolidated Financial Statements.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.
NIOCORP DEVELOPMENTS LTD.
(Registrant)
|
|
|
By: |
/s/ Mark A. Smith |
|
|
Mark A. Smith |
|
|
President, Chief Executive Officer and
Executive Chairman |
|
|
(Principal Executive Officer) |
|
|
|
|
Date: February 6, 2026 |
|
|
|
|
By: |
/s/ Neal Shah |
|
|
Neal Shah |
|
|
Chief Financial Officer |
|
|
(Principal Financial and Accounting Officer) |
|
|
|
Date: February 6, 2026 |
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