| Filed Pursuant to Rule 424(b)(3) |
| Registration No. 333-270541 |
PROSPECTUS
NioCorp Developments Ltd.
10,495,370 Common Shares
This prospectus relates to the offer and sale
from time to time of up to an aggregate of 10,495,370 of our common shares, without par value (“Common Shares”), by YA II
PN, Ltd. (“YA”), certain private placement investors (collectively, the “Private Placement Investors”), and Research
Capital Corporation and Red Cloud Mining Capital Inc. (together, the “Finders” and, collectively with YA and the Private Placement
Investors, the “Selling Shareholders”).
The Common Shares being registered hereunder
consist of (a) up to 8,211,892 Common Shares issuable to YA upon conversion of up to $16.0 million aggregate principal amount of, plus
accrued interest on, unsecured convertible debentures (the “Convertible Debentures”), which, together with the Financing Warrants
(as defined below), were issued to YA on March 17, 2023, pursuant to a Securities Purchase Agreement, dated January 26, 2023 (as amended,
the “Yorkville Convertible Debt Financing Agreement”), between us and YA, for total cash consideration of $15.36 million,
(b) up to 1,789,267 Common Shares issuable to YA upon exercise of Common Share purchase warrants, exercisable 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,
and expiring on the terms as described herein (the “Financing Warrants”), (c) up to 487,701 Common Shares issuable upon exercise
of Common Share purchase warrants, each exercisable for one Common Share for cash at a price per Common Share of C$11.00, subject to adjustment
for recapitalizations, stock splits, reverse stock splits and similar events, expiring June 30, 2024 (the “Private Placement Warrants”),
which were issued to the Private Placement Investors in connection with the Company’s June 2022 non-brokered private placement (the
“June 2022 Private Placement”) of units of the Company, comprised of one-tenth of one Common Share and one-tenth of one Private
Placement Warrant (after giving effect to the Reverse Stock Split (as defined herein)) (the “Units”), for C$0.96 per Unit,
and (d) up to 6,510 Common Shares issuable upon exercise of Common Share purchase warrants, each exercisable for one Common Share for
cash at a price per Common Share of C$11.00, subject to adjustment for recapitalizations, stock splits, reverse stock splits and similar
events, expiring June 30, 2024 (the “Finder Warrants” and, collectively with the Financing Warrants and the Private Placement
Warrants, the “Warrants”), which were issued to the Finders as part of a finder’s fee for services rendered in connection
with the June 2022 Private Placement.
We are not selling any securities under this
prospectus and will not receive any of the proceeds from the sale of our Common Shares by the Selling Shareholders. However, upon exercise,
we will receive the cash exercise price of the Warrants (assuming, with respect to the Financing Warrants, that the holders do not exercise
their Financing Warrants on a cashless basis). We believe the likelihood that Warrant holders will exercise their Warrants, and therefore
the amount of cash proceeds that we would receive, is, among other things, dependent upon the market price of our Common Shares. For so
long as the market price for our Common Shares is less than the applicable exercise price (as is the case as of the date of this prospectus),
we believe such holders will be unlikely to exercise their Warrants. We expect to use the net proceeds that we receive from the exercise
of the Warrants, if any, for working capital and general corporate purposes, including to advance our efforts to launch construction of
the Elk Creek Project and move it to commercial operation. See “Use of Proceeds.”
Our registration of the Common Shares covered
by this prospectus does not mean that the Selling Shareholders will offer or sell any Common Shares. The Selling Shareholders may offer
the Common Shares in one or more transactions at fixed prices, at prevailing market prices at the time of sale, at varying prices determined
at the time of sale, at negotiated prices, or in trading markets for our Common Shares. The Securities and Exchange Commission (the “SEC”)
may take the position that the Selling Shareholders are deemed “underwriters” within the meaning of Section 2(a)(11) of the
Securities Act of 1933 (the “Securities Act”) in connection with such sales. Any profits realized by the Selling Shareholders
and the compensation of any broker-dealer may be deemed to be underwriting discounts and commissions.
Additional information on the Selling Shareholders,
and the times and manner in which they may offer and sell Common Shares under this prospectus, is set forth in the sections entitled “Selling
Shareholders” and “Plan of Distribution” beginning on pages 15 and 41, respectively, of this prospectus.
The Selling Shareholders will pay all brokerage
fees, commissions and similar expenses in connection with the offer and sale of the Common Shares by the Selling Shareholders pursuant
to this prospectus. We will pay the expenses (except
brokerage fees, commissions and similar expenses) incurred in registering
under the Securities Act the offer and sale of the Common Shares included in this prospectus by the Selling Shareholders. See “Plan
of Distribution.”
If all of the Common Shares covered by this
prospectus were issued and outstanding, they would represent a substantial percentage of our public float and of our outstanding Common
Shares. As of May 4, 2023, the Common Shares covered by this prospectus would represent approximately 25.67% of the total number
of outstanding Common Shares (assuming all of the Common Shares covered by this prospectus were issued and outstanding and not including
Common Shares issuable upon exercise of outstanding stock options, or reserved for future issuance, under the NioCorp Developments Ltd.
Long-Term Incentive Plan (the “LTIP”), Common Shares issuable in respect of the Commitment Amount (as defined herein) pursuant
to the Yorkville Equity Facility Financing Agreement (as defined herein) or Common Shares issuable upon exercise or exchange of other
outstanding securities, as described herein). Upon their acquisition of the Common Shares covered by this prospectus, the Selling Shareholders
will be able to sell such Common Shares for so long as the registration statement of which this prospectus is a part is available for
use. Accordingly, the sale of the Common Shares covered by this prospectus, or the perception that such sales may occur, could result
in a significant decline in the public trading price of our Common Shares. Moreover, the sale of additional Common Shares by us or by
other security holders, or the perception that such sales may occur, could result in a further decline in the public trading price of
our Common Shares. See “Risk Factors—Additional Risks Related to this Offering and Our Common Shares.”
In addition, as described herein, the Common
Shares issuable upon conversion of the Convertible Debentures covered by this prospectus may be acquired by YA at a discount to the market
price of the Common Shares. Accordingly, subject to the Floor Price (as defined herein) and the restrictions on conversion pursuant to
the Yorkville Convertible Debt Financing Agreement and the terms of the Convertible Debentures, each as described herein, YA may have
an incentive to sell the Common Shares that it acquires upon conversion of the Convertible Debentures, even if the market price of our
Common Shares declines, that is not shared by other shareholders because the price at which it will be deemed to have purchased such Common
Shares may still be lower than the then-prevailing market price of the Common Shares. Similarly, to the extent that the Warrants are exercised,
the holders of such Common Shares issued upon exercise thereof may have an incentive to sell the Common Shares that is not shared by other
shareholders because the Common Shares issued upon the exercise of the Warrants may have been purchased for less than the then-prevailing
market price of the Common Shares. As a result, the Selling Shareholders may experience a positive rate of return on the Common Shares
covered by this prospectus due to the potential differences between the conversion or exercise prices of such securities and the market
price of the underlying Common Shares, and other shareholders may not experience a similar rate of return due to the differences in the
purchase prices and the then-prevailing market price of the Common Shares. See “Risk Factors—Additional Risks Related to this
Offering and Our Common Shares.”
Our Common Shares trade on The Nasdaq Global
Market under the symbol “NB” and on the Toronto Stock Exchange (the “TSX”) under the symbol “NB.”
On May 4, 2023, the last reported sale price of our Common Shares on The Nasdaq Global Market and the TSX was $6.09 per Common Share and
C$8.22 per Common Share, respectively. The public NioCorp Assumed Warrants (as defined herein) trade on The Nasdaq Capital Market under
the symbol “NIOBW.” On May 4, 2023, the last reported sale price of the public NioCorp Assumed Warrants on The Nasdaq Capital
Market was $0.60 per public NioCorp Assumed Warrant. Our principal executive office is located at 7000 South Yosemite Street, Suite 115,
Centennial, Colorado 80112, and our telephone number is (855) 264-6267.
Investing in our Common Shares involves a
high degree of risk. You should review carefully the risks and uncertainties referenced under the heading “Risk Factors” beginning
on page 6 of this prospectus.
Neither the SEC nor any state securities
commission has approved or disapproved of these securities or determined if this prospectus is truthful or complete. Any representation
to the contrary is a criminal offense.
The date of this
prospectus is May 4, 2023.
TABLE
OF CONTENTS
Page
ABOUT THIS PROSPECTUS
This prospectus is part of a registration statement
on Form S-3 that we filed with the SEC using a “shelf” registration process. The Selling Shareholders may, from time to time,
sell the Common Shares described in this prospectus.
You should rely only on the information provided
in this prospectus, as well as the information incorporated by reference into this prospectus and any applicable prospectus supplement.
Neither we nor the Selling Shareholders have authorized anyone to provide you with different information. Neither we nor the Selling Shareholders
have authorized anyone to provide you with any information or to make any representations other than those contained in this prospectus
or any applicable prospectus supplement or any free writing prospectuses prepared by or on behalf of us or to which we have referred you.
Neither we nor the Selling Shareholders take responsibility for, and can provide no assurance as to the reliability of, any other information
that others may give you. You should not assume that the information in this prospectus or any applicable prospectus supplement is accurate
as of any date other than the date of the applicable document. Since the date of this prospectus and the documents incorporated by reference
into this prospectus, our business, financial condition, results of operations and prospects may have changed. Neither we nor the Selling
Shareholders will make an offer to sell these securities in any jurisdiction where the offer or sale is not permitted.
We may also provide a prospectus supplement
or post-effective amendment to the registration statement of which this prospectus is a part to add information to, or update or change
information contained in, this prospectus and the registration statement of which this prospectus is a part. You should read this prospectus
and any applicable prospectus supplement or post-effective amendment to the registration statement of which this prospectus is a part
together with the additional information to which we refer you in the sections of this prospectus entitled “Where You Can Find More
Information” and “Incorporation of Documents by Reference.”
Unless we state otherwise or the context
otherwise requires, the terms “we,” “us,” “our,” “our business” “NioCorp,”
“the Company” and similar references refer to NioCorp Developments Ltd. and its consolidated subsidiaries.
Unless we state otherwise or the context
otherwise requires, the term “ECRC” refers to Elk Creek Resources Corp. (formerly known as GX Acquisition Corp. II), a Delaware
corporation and a majority-owned subsidiary of NioCorp, as the surviving entity of the mergers that occurred on the Closing Date (as
defined herein) as part of the Transactions, and the term “GXII” refers to GX Acquisition Corp. II, a Delaware corporation,
as it existed prior to the Closing (as defined herein).
This prospectus contains our registered and
unregistered trademarks and service marks, as well as trademarks and service marks of third parties. Solely for convenience, these trademarks
and service marks are referenced without the ®, ™ or similar symbols, but such references are not intended to indicate, in anyway,
that we will not assert, to the fullest extent under applicable law, our rights to these trademarks and service marks. All brand names,
trademarks and service marks appearing in this prospectus are the property of their respective holders.
WHERE YOU CAN
FIND MORE INFORMATION
This prospectus is part of a registration statement
on Form S-3 that we filed with the SEC under the Securities Act and does not contain all the information set forth or incorporated by
reference in the registration statement. Whenever a reference is made in this prospectus to any of our contracts, agreements or other
documents, the reference may not be complete and you should refer to the exhibits that are a part of the registration statement of which
this prospectus is a part or the exhibits to the reports or other documents incorporated by reference into this prospectus for a copy
of such contract, agreement or other document. You may obtain copies of the registration statement and its exhibits via the SEC’s
EDGAR database.
We file annual, quarterly and current reports,
proxy statements and other information with the SEC under the Securities Exchange Act of 1934 (the “Exchange Act”). The SEC
maintains a website that contains reports, proxy and information statements and other information regarding issuers, including us, that
file electronically with the SEC. You may obtain documents that we file with the SEC at www.sec.gov.
We make available, free of charge, on our website
at www.niocorp.com, our annual reports on Form 10-K, quarterly reports on Form 10-Q, current reports on Form 8-K, proxy statements and
amendments to those reports and statements as soon as reasonably practicable after they are filed with the SEC. We do not incorporate
the information on or accessible through any website into this prospectus or any prospectus supplement, and you should not consider any
information on, or that can be accessed through, any website as part of this prospectus or any prospectus supplement. Our website address
and the SEC’s website address are included in this prospectus as inactive textual references only.
INCORPORATION
OF DOCUMENTS BY REFERENCE
SEC rules permit us to incorporate information
by reference into this prospectus and any applicable prospectus supplement. This means that we can disclose important information to you
by referring you to another document filed separately with the SEC. The information incorporated by reference is considered to be part
of this prospectus and any applicable prospectus supplement, except for information superseded by information contained in this prospectus
or the applicable prospectus supplement itself or in any subsequently filed incorporated document. This prospectus and any applicable
prospectus supplement incorporate by reference the documents set forth below that we have previously filed with the SEC, other than information
in such documents that is deemed to be furnished and not filed. These documents contain important information about us and our business
and financial condition. Any report or information within any of the documents referenced below that is furnished, but not filed, shall
not be incorporated by reference into this prospectus:
| • | our Annual Report on Form 10-K for the fiscal
year ended June 30, 2022, filed with the SEC on September 6, 2022, as amended by Amendment No. 1 to our Annual Report on Form 10-K/A for
the fiscal year ended June 30, 2022, filed with the SEC on October 31, 2022; |
| • | our Quarterly Reports on Form 10-Q for the quarter
ended September 30, 2022, filed with the SEC on November 14, 2022, and for the quarter ended December 31, 2022, filed with the SEC on
February 13, 2023; |
| • | our Current Reports on Form 8-K, filed with the SEC on September 29, 2022,
October 21, 2022, December 15, 2022 (as amended by our Current Report on Form 8-K/A filed on April 3, 2023), January 27, 2023 (Items 1.01,
2.03, 3.02 and 9.01 (Exhibits 4.1, 4.2, 4.3, 4.4 and 10.1) only), February 13, 2023, February 24, 2023, February 28, 2023, March 1, 2023,
March 6, 2023, March 10, 2023, March 14, 2023, March 17, 2023 (Items 1.01, 2.01, 3.01, 3.02, 3.03, 5.02, 8.01 and 9.01 (Exhibits 2.1,
3.1, 4.1, 4.2, 4.3, 10.1, 10.2, 10.3 and 10.4) only) and April 19, 2023; and |
| • | a description of our Common Shares, contained
in our Registration Statement on Form 8-A, filed with the SEC on March 17, 2023, and any subsequently filed amendments and reports filed
for the purpose of updating that description. |
We also incorporate by reference any future
filings made by us with the SEC under Section 13(a), 13(c), 14 or 15(d) of the Exchange Act (excluding any information furnished to, rather
than filed with, the SEC), including after the date of the initial registration statement of which this prospectus is a part and prior
to effectiveness of the registration statement, and after effectiveness of the registration statement and prior to the termination of
the offering of the securities made by this prospectus. Information in such future filings updates and supplements the information provided
in this prospectus. Any statements in any such future filings will automatically be deemed to modify and supersede any information in
any document we previously filed with the SEC that is incorporated or deemed to be incorporated herein by reference to the extent that
statements in the later filed document modify or replace such earlier statements.
You may request a copy of these filings, at
no cost, by writing or calling us at the following address or telephone number below:
NioCorp Developments Ltd.
7000 South Yosemite Street, Suite 115
Centennial, Colorado 80112
Phone: (855) 264-6267
Those copies will not include exhibits, unless
the exhibits have specifically been incorporated by reference in this document or you specifically request them.
SUMMARY
This summary highlights selected information
appearing in this prospectus. Because it is a summary, it may not contain all of the information that may be important to you. To understand
this offering fully, you should read this entire prospectus carefully, including the information set forth in the section entitled “Risk
Factors” contained in this prospectus and under similar headings in the other documents that are incorporated by reference into
this prospectus. You should also carefully read the information incorporated by reference into this prospectus, including our consolidated
financial statements and related notes and the exhibits to the registration statement of which this prospectus is a part, before making
an investment decision. This prospectus includes forward-looking statements that involve risks and uncertainties. See “Cautionary
Note Regarding Forward-Looking Statements.”
NioCorp Developments Ltd.
NioCorp is a mineral exploration company engaged
in the acquisition, exploration, and development of mineral properties. NioCorp, through its indirect, majority-owned subsidiary, ECRC,
is developing a superalloy materials project that, if and when developed, will produce niobium, scandium, and titanium products. Known
as the “Elk Creek Project,” it is located near Elk Creek, Nebraska, in the southeast portion of the state.
| ● | 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 enables those applications to be stronger and lighter in mass. This “lightweighting” benefit often
results in environmental benefits, including reduced fuel consumption and material usage, which can result in fewer air emissions. |
| ● | Scandium can be combined with aluminum to make super-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. |
During fiscal year 2022, the Company also advanced
work on the determination of the economic potential of expanding its currently planned product suite from the Elk Creek Project to include
rare earth elements.
Our primary business strategy is to advance
our Elk Creek Project to commercial production. We are focused on obtaining additional funds to carry out our near-term planned work programs
associated with securing the project financing necessary to complete mine development and construction of the Elk Creek Project.
Background
Completion of the Transactions
On March 17, 2023 (the “Closing Date”),
NioCorp consummated the transactions contemplated by the previously-announced Business Combination Agreement, dated as of September 25,
2022 (the “Business Combination Agreement”), among NioCorp, GXII and Big Red Merger Sub Ltd (the “Closing”). The
transactions contemplated by the Business Combination Agreement, including the reverse stock split at a ratio of 10-for-1 effectuated
by each of NioCorp and ECRC on the Closing Date (the “Reverse Stock Split”), are referred to, collectively, as the “Transactions.”
In connection with the Closing, GXII, as the
surviving entity of the mergers that occurred on the Closing Date as part of the Transactions, changed its name to Elk Creek Resources
Corp. and became an indirect, majority-owned subsidiary of NioCorp, with the pre-combination public shareholders of GXII receiving Common
Shares based on a fixed exchange ratio of 11.1829212 (or 1.11829212 after giving effect to the Reverse Stock Split) (the “Exchange
Ratio”) Common Shares for each Class A common share of GXII held and not redeemed, and the GXII founders receiving shares of Class
B common stock of ECRC based on the Exchange Ratio. Pursuant to the Business Combination Agreement, the Sponsor Support Agreement, dated
as of September 25, 2022 (as amended,
supplemented or otherwise modified), by and among GXII, NioCorp,
GX Sponsor II LLC, in its capacity as a stockholder of GXII (the “Sponsor”), and certain other stockholders of GXII, and the
Exchange Agreement, dated as of March 17, 2023 (as amended, supplemented or otherwise modified), by and among NioCorp, ECRC and the Sponsor,
after the Closing, the GXII founders have the right to exchange such shares of Class B common stock of ECRC for Common Shares on a one-for-one
basis, subject to certain equitable adjustments, under certain conditions.
In connection with the Closing, pursuant to
the Business Combination Agreement, the Company assumed the Warrant Agreement, dated as of March 17, 2021 (the “GXII Warrant Agreement”),
by and between GXII and Continental Stock Transfer & Trust Company (“CST”), as warrant agent, and each share purchase
warrant of GXII thereunder (the “GXII Warrants”) that was issued and outstanding immediately prior to the Closing Date was
converted into one purchase warrant of the Company, exercisable for 1.11829212 Common Shares at a price per 1.11829212 Common Shares of
$11.50 (each, a “NioCorp Assumed Warrant”), pursuant to the GXII Warrant Agreement, as amended by an assignment, assumption
and amendment agreement, dated the Closing Date (the GXII Warrant Agreement, as so amended, the “NioCorp Assumed Warrant Agreement”),
among NioCorp, GXII, CST, as existing warrant agent, and Computershare Inc. and its affiliate Computershare Trust Company, N.A., together
as successor warrant agent (the “NioCorp Assumed Warrant Agent”). See “Description of Capital Stock—NioCorp Assumed
Warrants” for a description of certain terms of the NioCorp Assumed Warrants.
Yorkville Financings
In connection with the entry into the Business
Combination Agreement, the Company announced the signing of non-binding letters of intent for two separate financing packages with Yorkville
Advisors Global, LP. On January 26, 2023, the Company entered into definitive agreements with respect to these financings, including the
Yorkville Convertible Debt Financing Agreement and a Standby Equity Purchase Agreement, dated January 26, 2023 (the “Yorkville Equity
Facility Financing Agreement”), between the Company and YA. Pursuant to the Yorkville Equity Facility Financing Agreement, YA has
committed to purchase up to $65.0 million of our Common Shares (the “Commitment Amount”), at our direction from time to time
for a period commencing upon the Closing Date and ending on the earliest of (i) the first day of the month next following the 36-month
anniversary of the Closing, (ii) the date on which YA shall have made payment of the full Commitment Amount and (iii) the date that the
Yorkville Equity Facility Financing Agreement otherwise terminates in accordance with its terms (the “Commitment Period”),
subject to certain limitations and the satisfaction of the conditions in the Yorkville Equity Facility Financing Agreement. Pursuant to
the terms of the Yorkville Equity Facility Financing Agreement, we issued 81,213 of our Common Shares (the “Commitment Shares”)
to YA as consideration for its irrevocable commitment to purchase Common Shares under the Yorkville Equity Facility Financing Agreement.
Additionally, we are required to pay YA an aggregate fee of $1,500,000 in cash (the “Cash Fee”), including $500,000 that we
paid on the Closing Date and the remainder that we will pay in installments over a 12-month period following the Closing Date, provided
that, we will have the right to prepay without penalty all or part of the remaining installments of the Cash Fee at any time.
Pursuant to the Yorkville Convertible Debt
Financing Agreement, at the Closing, YA advanced a total amount of $15.36 million to NioCorp in consideration of the issuance by NioCorp
to YA of (i) $16.0 million aggregate principal amount of Convertible Debentures and (ii) Financing Warrants, exercisable for up to 1,789,267
Common Shares for cash or, if at any time there is no effective registration statement registering, or no current prospectus available
for, the resale of the underlying Common Shares, on a cashless basis, at the option of the holder, at a price per Common Share of approximately
$8.9422, subject to adjustment to give effect to any stock dividend, stock split, reverse stock
split or similar transaction. The Convertible Debentures and the Financing Warrants were offered to YA on a private offering basis
pursuant to the exemption from the registration requirements of the Securities Act provided by Section 4(a)(2) thereof and/or Rule 506
of Regulation D promulgated thereunder. See “Description of Capital Stock—Yorkville Convertible Debentures” and “Description
of Capital Stock—Financing Warrants,” respectively, for descriptions of certain terms of the Convertible Debentures and the
Financing Warrants.
The Yorkville Convertible Debt Financing Agreement
contains customary representations, warranties, conditions and indemnification obligations by each party. The representations, warranties
and covenants contained in the Yorkville Convertible Debt Financing Agreement were made only for purposes of the Yorkville Convertible
Debt Financing 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 Yorkville Convertible Debt Financing Agreement
also contains covenants that, among other things, limit NioCorp’s ability to use the proceeds from the Yorkville Convertible Debt
Financing to repay related party debt or to enter into any variable rate transaction other than with Yorkville, subject to certain exceptions.
On January 26, 2023, in connection with the
Yorkville Convertible Debt Financing Agreement, NioCorp and Yorkville also entered into a registration rights agreement (the “Convertible
Debt Financing Registration Rights Agreement”) pursuant to which, among other matters, NioCorp has agreed to file with the SEC a
registration statement registering under the Securities Act the resale by YA of the Common Shares issuable upon the conversion of the
Convertible Debentures and the exercise of the Financing Warrants, as soon as practicable but no later than 21 calendar days following
the Closing Date, and to use its reasonable best efforts to have the Convertible Debt Financing Registration Statement declared effective
as soon as practicable after the filing thereof, but in no event later than the 45th calendar day following the filing date thereof. NioCorp
further agreed to use its reasonable best efforts to cause the Convertible Debt Financing Registration Statement to remain continuously
effective for a period that will terminate upon the first date on which all of the Common Shares issuable upon the conversion of the Convertible
Debentures and the exercise of the Financing Warrants may be sold without restriction, including volume and manner-of-sale restrictions,
pursuant to Rule 144 under the Securities Act or have been sold by Investors. NioCorp also granted to YA certain demand rights for underwritten
shelf takedowns and piggyback registration rights with respect to the Common Shares issuable upon the conversion of the Convertible Debentures
and the exercise of the Financing Warrants.
We are filing the registration statement of
which this prospectus is a part, among other reasons, to satisfy our obligations under the Convertible Debt Financing Registration Rights
Agreement with respect to registering the Common Shares issuable upon conversion of the Convertible Debentures and exercise of the Financing
Warrants.
June 2022 Private Placement
On June 30, 2022, the Company issued 4,981,035
Units at a price of C$0.96 per Unit for aggregate gross proceeds of approximately C$4.78 million, in connection with the closing of the
June 2022 Private Placement. Each Unit consisted of one-tenth of one Common Share and one-tenth of one Private Placement Warrant (after
giving effect to the Reverse Stock Split). Each Private Placement Warrant may be exercised for one Common Share for cash at a price of
C$11.00 until June 30, 2024. Additionally, in connection with the June 2022 Private Placement, as consideration for services rendered
as finders, we issued an aggregate of 6,510 Finder Warrants to the Finders, each of which is exercisable for one Common Share for cash
at a price of C$11.00 until June 30, 2024.
In connection with the June 2022 Private Placement,
the Company entered into subscription agreements (collectively, the “Subscription Agreements”) with each Private Placement
Investor. The Subscription Agreements contain customary representations, warranties, conditions and indemnification obligations of the
parties. The representations, warranties and covenants were made only for purposes of such agreements and as of specific dates, were solely
for the benefit of the parties to such agreements and may be subject to limitations agreed upon by the contracting parties. The Units
were issued on a private offering basis to investors with whom the Company had a pre-existing relationship pursuant to (i) in the case
of investors outside of the United States that were not, and were not acting for the account or benefit of, a U.S. person (as defined
in Regulation S under the Securities Act), the exclusion from the registration requirements of the Securities Act provided by Rule 903
of Regulation S thereunder, and (ii) in the case of investors inside the United States or that were, or were acting for the account or
benefit of, a U.S. person, the exemption from the registration requirements of the Securities Act provided by Rule 506(b) of Regulation
D thereunder and Section 4(a)(2) thereof, in each case, pursuant to the representations and covenants the investors made to the Company
in connection with their purchase of the Units.
Corporate Information
Our Common Shares trade on The Nasdaq Global
Market under the symbol “NB” and on the TSX under the symbol “NB.” The public NioCorp Assumed Warrants trade on
The Nasdaq Capital Market under the symbol “NIOBW.” Our principal executive office is located at 7000 South Yosemite Street,
Suite 115, Centennial, CO 80112, and our telephone number is (855) 264-6267. Our website address is www.niocorp.com. This website address
is not intended to be an active link, and information on, or accessible through, our website is not incorporated by reference into this
prospectus and you should not consider any information on, or that can be accessed from, our website as part of this prospectus or any
accompanying prospectus supplement.
SECURITIES
OFFERED
| Common Shares Offered by the Selling
Shareholders |
Up to 10,495,370
Common Shares consisting of:
(a) up to 8,211,892 Common Shares issuable upon conversion of the Convertible Debentures;
(b) up to 1,789,267 Common Shares issuable upon exercise of the Financing Warrants;
(c) up to 487,701 Common Shares issuable upon exercise of the Private Placement Warrants; and
(d) up to 6,510 Common Shares issuable upon exercise of the Finder Warrants. |
| Common Shares Outstanding Prior to this Offering(1) |
30,396,120 Common Shares (as of May 4, 2023). |
| Common Shares Outstanding After this Offering(1) |
40,891,490 Common Shares, assuming the issuance of (i)
8,211,892 Common Shares upon conversion of the Convertible Debentures, (ii) 1,789,267 Common Shares upon exercise of the Financing
Warrants, (iii) 487,701 Common Shares upon exercise of the Private Placement Warrants and (iv) 6,510 Common Shares upon exercise of
the Financing Warrants. |
| Use of Proceeds |
We will not receive any proceeds
from the sale of Common Shares included in this prospectus by the Selling Shareholders. However, we will receive the cash exercise
price of the Warrants upon exercise thereof (assuming, with respect to the Financing Warrants, that the holders do not exercise their
Financing Warrants on a cashless basis, which they may not do for so long as there is an effective registration statement registering,
and a current prospectus available for, the resale of the Common Shares thereunder, including this prospectus and the registration
statement of which this prospectus is a part). We believe the likelihood that Warrant holders will exercise their Warrants, and therefore
the amount of cash proceeds that we would receive, is, among other things, dependent upon the market price of our Common Shares.
For so long as the market price for our Common Shares is less than the applicable exercise price of the Warrants (as is the case
as of the date of this prospectus), we believe such holders will be unlikely to exercise their Warrants. We expect to use the net
proceeds that we receive from the exercise of the Warrants, if any, for working capital and general corporate purposes, including
to advance our efforts to launch construction of the Elk Creek Project and move it to commercial operation. See “Use of Proceeds.” |
| Market for Common Shares |
Our Common Shares trade on
The Nasdaq Global Market under the symbol “NB” and on the TSX under the symbol “NB.” |
| Risk Factors |
See “Risk Factors”
and other information included in this prospectus for a discussion of factors you should consider before investing in our securities. |
| • | Common Shares issuable upon exercise of outstanding stock options under the
LTIP; |
| • | Common Shares reserved for future issuance under the LTIP; |
| • | Common Shares issuable in respect of the Commitment Amount pursuant to the
Yorkville Equity Facility Financing Agreement; |
| • | an aggregate of 7,957,404 Common Shares issuable under certain conditions
upon exchange of shares of Class B common stock of ECRC; |
| • | an aggregate of 17,519,864 Common Shares issuable upon exercise of NioCorp
Assumed Warrants; and |
| • | an aggregate of 1,307,411 Common Shares issuable upon exercise of other outstanding
Common Share purchase warrants with a weighted-average exercise price of approximately C$11.94. |
RISK FACTORS
Investing in our Common Shares involves a high
degree of risk. Before making a decision to invest in our Common Shares, you should carefully consider the risks described below and under
the heading “Risk Factors” in the applicable prospectus supplement, and discussed under Part I, Item 1A. “Risk Factors”
contained in our most recent Annual Report on Form 10-K, and Part II, Item 1A. “Risk Factors” contained in our subsequent
Quarterly Reports on Form 10-Q, as well as any amendments thereto, which are incorporated by reference into this prospectus and the applicable
prospectus supplement in their entirety, together with other information in this prospectus and the applicable prospectus supplement and
the documents incorporated by reference herein and therein. See the sections of this prospectus entitled “Where You Can Find More
Information” and “Incorporation of Documents by Reference.” Additional risks and uncertainties not presently known to
us or that we currently deem immaterial may also affect our business, financial condition or results of operations. The occurrence of
any of these known or unknown risks might cause you to lose all or part of your investment in our Common Shares.
Additional Risks Related to this Offering
and Our Common Shares
Future sales, or the perception of future sales, of Common
Shares covered by this prospectus by the Selling Shareholders could adversely affect prevailing market prices for the Common Shares.
Under this prospectus, the Selling Shareholders
may sell (a) up to 8,211,892 Common Shares issuable to YA upon conversion of up to $16.0 million aggregate principal amount of, plus accrued
interest on, the Convertible Debentures, which are convertible on the terms of the Yorkville Convertible Debt Financing Agreement and
the Convertible Debentures, as described herein, at the Conversion Price (as defined below), (b) up to 1,789,267 Common Shares issuable
to YA upon exercise of the Financing Warrants, which are exercisable 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, (c) up to 487,701 Common Shares issuable
upon exercise of the Private Placement Warrants, each exercisable for one Common Share for cash at a price per Common Share of C$11.00,
subject to adjustment for recapitalizations, stock splits, reverse stock splits and similar events, and (d) up to 6,510 Common Shares
issuable upon exercise of the Finder Warrants, each exercisable for one Common Share for cash at a price per Common Share of C$11.00,
subject to adjustment for recapitalizations, stock splits, reverse stock splits and similar events.
The “Conversion Price” with respect
to the Convertible Debentures means, as of any Conversion Date (as defined below) or other date of determination, the greater of (i) 90%
of the average of the daily U.S. dollar volume-weighted average price of the Common Shares on the principal U.S. market for the Common
Shares as reported by Bloomberg Financial Markets during the five consecutive trading days immediately preceding the date on which the
holder exercises its conversion right in accordance with the requirements of the Yorkville Convertible Debt Financing Agreement (the “Conversion
Date”) or other date of determination, but not lower than the Floor Price, and (ii) the five-day volume-weighted average price of
the Common Shares on the TSX (or on the principal U.S. market if the majority of the trading volume and value of the Common Shares occurred
on The Nasdaq Stock Market LLC (“Nasdaq”) during the relevant period) for the five consecutive trading days immediately prior
to the Conversion Date or other date of determination less the maximum applicable discount allowed by the TSX.
Because the Common Shares issuable upon conversion
of the Convertible Debentures covered by this prospectus may be acquired by YA at a discount to the market price of the Common Shares,
however, YA will have an incentive to convert its Convertible Debentures and may have an incentive to sell the Common Shares that it acquires
upon conversion of the Convertible Debentures even if the market price of our Common Shares declines. Similarly, to the extent that the
Warrants are exercised, the holders of the Common Shares issued upon exercise thereof may have an incentive to sell such Common Shares
because the Common Shares issued upon the exercise of the Warrants may have been purchased for less than the then-prevailing market price
of the Common Shares. However, for so long as the market price for our Common Shares is less than the applicable exercise price of the
Warrants (as is the case as of the date of this prospectus), we believe holders of the Warrants will be unlikely to exercise their Warrants.
If all of the Common Shares covered by this
prospectus were issued and outstanding, they would represent a substantial percentage of our public float and of our outstanding Common
Shares. As of May 4, 2023, the
Common Shares covered by this prospectus would represent approximately
25.67% of the total number of outstanding Common Shares (assuming all of the Common Shares covered by this prospectus were issued and
outstanding and not including Common Shares issuable upon exercise of outstanding stock options, or reserved for future issuance, under
the LTIP, Common Shares issuable in respect of the Commitment Amount pursuant to the Yorkville Equity Facility Financing Agreement or
Common Shares issuable upon exercise or exchange of other outstanding securities). Upon their acquisition of the Common Shares covered
by this prospectus, the Selling Shareholders will be able to sell such Common Shares into the public market for so long as the registration
statement of which this prospectus is a part is available for use. Accordingly, the sale of the Common Shares covered by this prospectus,
or the perception that such sales may occur, could result in a significant decline in the public trading price of our Common Shares.
We may not recognize the full value of the Yorkville Equity
Facility Financing Agreement and may not receive any proceeds from the exercise of the Warrants, the NioCorp Assumed Warrants and our
other outstanding Common Share purchase warrants, and the potential adverse effect on the prevailing market prices for our Common Shares
as a result of sales, or the perception of future sales, of Common Shares covered by this prospectus by the Selling Shareholders could
adversely affect our ability to raise additional capital and you could lose all or part of your investment.
Although we have entered into the Yorkville
Equity Facility Financing Agreement, we may not recognize the full value thereof. Specifically, our ability to sell Common Shares to YA
pursuant to the Yorkville Equity Facility Financing Agreement is subject to certain restrictions and limitations, which may prevent us
from selling the full Commitment Amount prior to the expiration of the Commitment Period. Our ability to recognize the full value of the
Yorkville Equity Facility Financing Agreement may be further impeded by the potential negative pressure on the market price of our Common
Shares as a result of sales, or the perception of future sales, of the Common Shares covered by this prospectus by the Selling Shareholders.
As a result, there can be no assurance that we will receive all or even a significant portion of the proceeds that we expect to receive
in connection with the Yorkville Equity Facility Financing Agreement.
In addition, we are not selling any securities
under this prospectus and will not receive any of the proceeds from the sale of our Common Shares by the Selling Shareholders. However,
upon exercise, we will receive the cash exercise price of the Warrants (assuming, with respect to the Financing Warrants, that the holders
do not exercise their Financing Warrants on a cashless basis). Further, we will receive the cash exercise price of the NioCorp Assumed
Warrants and our other outstanding Common Share purchase warrants upon exercise (assuming, with respect to the NioCorp Assumed Warrants,
that they are not exercised on a cashless basis). We believe the likelihood that holders of the Warrants, the NioCorp Assumed Warrants
or other outstanding Common Share purchase warrants will exercise their Warrants, NioCorp Assumed Warrants or other outstanding Common
Share purchase warrants, and therefore the amount of cash proceeds that we would receive, is, among other things, dependent upon the market
price of our Common Shares. For so long as the market price for our Common Shares is less than the applicable exercise price of the Warrants,
the NioCorp Assumed Warrants or other outstanding Common Share purchase warrants (as is the case as of the date of this prospectus), we
believe such holders will be unlikely to exercise their Warrants, NioCorp Assumed Warrants or other outstanding Common Share purchase
warrants. The potential adverse effect on the prevailing market price of our Common Shares as a result of sales of Common Shares covered
by this prospectus by the Selling Shareholders, or the perception that such sales may occur, could keep the market price for our Common
Shares below the applicable exercise price of the Warrants, the NioCorp Assumed Warrants or other outstanding Common Share purchase warrants.
Accordingly, the holders of the Warrants, the NioCorp Assumed Warrants or other outstanding Common Share purchase warrants may not exercise
their Warrants, NioCorp Assumed Warrants or other outstanding Common Share purchase warrants before they expire, and we may not receive
any proceeds from the exercise of the Warrants, the NioCorp Assumed Warrants or other outstanding Common Share purchase warrants.
We incurred significant debt in connection
with the Transactions, including upon issuance of the Convertible Debentures, and we require significant additional capital to operate
our business. For example, notwithstanding whether we are able to recognize the full value of the Yorkville Equity Facility Financing
Agreement or receive the cash exercise price of the Warrants, the NioCorp Assumed Warrants or other outstanding Common Share purchase
warrants, we are obligated to repay or issue Common Shares upon settlement of the full $16.0 million aggregate principal amount of the
Convertible Debentures. Such significant additional debt could adversely affect our
business, which may prevent us from fulfilling our obligations with
respect to our existing debt or obtaining future financing. Further, the Yorkville Convertible Debt Financing Agreement restricts us from
pursuing certain variable rate financing transactions, which could impair our ability to obtain additional financing on terms that are
favorable, or at all. In addition, if the market price of the Common Shares were to drop as a result of sales, or the perception of future
sales, of the Common Shares covered by this prospectus by the Selling Shareholders, this might impede our ability to raise additional
capital. Our inability to obtain additional financing on terms that are favorable, or at all, could have a material adverse effect on
our financial condition, results of operations and prospects, and you may lose all or part of your investment.
Future sales, or the perception of future sales, of Common
Shares by existing shareholders or by us, or future dilutive issuances of Common Shares by us, could adversely affect prevailing market
prices for the Common Shares.
In addition to the Common Shares that may be
sold by the Selling Shareholders under this prospectus, subject to compliance with applicable securities laws, sales of a substantial
number of Common Shares in the public market could occur at any time, including issuances and sales of additional Common Shares by us
and sales by other security holders. These sales, or the market perception that the holders of a large number of Common Shares or securities
convertible, exercisable or exchangeable into Common Shares intend to sell Common Shares, could reduce the prevailing market price of
the Common Shares. The effect, if any, that future public sales of these securities or the availability of these securities for sale will
have on the market price of the Common Shares is uncertain. If the market price of the Common Shares were to drop as a result, this might
impede our ability to raise additional capital and might cause remaining shareholders to lose all or part of their investment.
Following the Closing, the Sponsor, the members
of the Sponsor, the advisors of GXII that received Common Shares as part of their fee in connection with the Closing, as well as the pre-Closing
directors and officers of NioCorp, are subject to “lock-up” restrictions. The provisions of these “lock-up” restrictions
may be waived under limited circumstances and allow us to, among other things, issue additional Common Shares, or allow the directors
and officers of NioCorp or its shareholders to sell their Common Shares at any time. There are no pre-established conditions for the grant
of such a waiver by the relevant parties, and any decision by the applicable parties to waive those conditions may depend on a number
of factors, which might include market conditions, the performance of the Common Shares in the market and our financial condition at that
time. If the “lock-up” restrictions of the applicable shareholders or the directors and officers of NioCorp are waived, additional Common Shares will be available
for sale into the public market, subject to applicable securities laws, which, in both cases, could reduce the prevailing market price
for the Common Shares.
Additionally, pursuant to the Yorkville Equity
Facility Financing Agreement, YA has committed to purchase up to $65.0 million of our Common Shares, at our direction from time to time
during the Commitment Period, subject to certain limitations and the satisfaction of the conditions in the Yorkville Equity Facility Financing
Agreement. Pursuant to the terms of the Yorkville Equity Facility Financing Agreement, we issued 81,213 Commitment Shares to YA as consideration
for its irrevocable commitment to purchase Common Shares under the Yorkville Equity Facility Financing Agreement. We have agreed to file
a registration statement under the Securities Act covering resales by YA of the Common Shares issuable pursuant to the Yorkville Equity
Facility Financing Agreement. Accordingly, any Common Shares that we issue pursuant to the Yorkville Equity Facility Financing Agreement
will be available for sale into the public market, subject to applicable securities laws, which could reduce the prevailing market price
for the Common Shares.
Also, in connection with the Closing, pursuant
to the Business Combination Agreement, the Company issued an aggregate of 15,666,626 NioCorp Assumed Warrants, which are exercisable for
an aggregate of up to 17,519,864 Common Shares. 5,666,667 NioCorp Assumed Warrants are held by members of the Sponsor and are subject
to the “lock-up” restrictions described above, but 9,999,959 NioCorp Assumed Warrants are currently publicly traded. Pursuant
to the NioCorp Assumed Warrant Agreement, we have agreed to file a registration statement under the Securities Act covering the offering,
issuance and sale of the Common Shares issuable upon exercise of the NioCorp Assumed Warrants. Accordingly, any Common Shares that we
issue upon exercise of NioCorp Assumed Warrants will be available for sale into the public market, subject to applicable securities laws,
which could reduce the prevailing market price for the Common Shares.
The Selling Shareholders may acquire the Common Shares covered
by this prospectus at a price below the prevailing market price of our Common Shares, and may experience a positive rate of return based
on such market price. Our future investors may not experience a similar rate of return.
The Common Shares issuable upon conversion
of the Convertible Debentures may be acquired by YA at a discount to the market price of the Common Shares. Accordingly, subject to the
Floor Price and the restrictions on conversion pursuant to the Yorkville Convertible Debt Financing Agreement and the terms of the Convertible
Debentures, each as described herein, YA may have an incentive to sell the Common Shares that it acquires upon conversion of the Convertible
Debentures, even if the market price of our Common Shares declines, that is not shared by other shareholders because the price at which
it will be deemed to have purchased such Common Shares may be lower than the then-prevailing market price of the Common Shares. Similarly,
to the extent that the Warrants are exercised, the holders of such Common Shares issued upon exercise thereof may have an incentive to
sell the Common Shares that is not shared by other shareholders because the Common Shares issued upon the exercise of the Warrants may
have been purchased for less than the then-prevailing market price of the Common Shares. As a result, the Selling Shareholders may experience
a positive rate of return on the Common Shares covered by this prospectus due to the potential differences between the conversion or exercise
prices of such securities and the market price of the underlying Common Shares, and other shareholders may not experience a similar rate
of return due to the differences in the purchase prices and the then-prevailing market price of the Common Shares.
There can be no assurance that we will be able to comply with
the continued listing standards of Nasdaq.
Our Common Shares are currently listed on The
Nasdaq Global Market under the symbol “NB.” If Nasdaq delists the Common Shares from trading on its exchange for failure to
meet Nasdaq continued listing standards, the Company and its shareholders could face significant material adverse consequences, including:
| ● | a limited availability of market quotations for our securities; |
| ● | a determination that our Common Shares are a “penny stock,” which will require brokers trading in Common Shares to adhere
to more stringent rules, possibly resulting in a reduced level of trading activity in the secondary trading market for Common Shares; |
| ● | a limited amount of analyst coverage; and |
| ● | a decreased ability to issue additional securities or obtain additional financing in the future. |
The Articles of NioCorp, as amended in connection with the
Transactions (the “Amended Articles”), permit us to issue an unlimited number of Common Shares without seeking shareholder
approval.
The Amended Articles permit us to issue an
unlimited number of Common Shares. It is anticipated that we will, from time to time, issue additional Common Shares in the future. Subject
to the requirements of the British Columbia Business Corporations Act (“BCBCA”), Nasdaq and the TSX, we will not be required
to obtain the approval of the NioCorp shareholders for the issuance of additional Common Shares. Any further issuances of Common Shares
will result in immediate dilution to existing shareholders and may have an adverse effect on the value of their shareholdings.
NioCorp may be a “passive foreign investment company”
for the current taxable year and for one or more future taxable years, which may result in materially adverse U.S. federal income tax
consequences for U.S. investors.
If NioCorp is a passive foreign investment
company (“PFIC”) for any taxable year, or portion thereof, that is included in the holding period of a U.S. Holder (as defined
in “Certain United States Federal Income Tax Considerations,” below) of Common Shares, such U.S. Holder may be subject to
certain adverse U.S. federal income tax consequences and additional reporting requirements. NioCorp believes it was classified as a PFIC
during its taxable years ended June 30, 2022 and June 30, 2021 and, based on the current composition of its income and assets, as well
as current business plans and financial expectations, may be treated as a PFIC for the taxable year in which the Transactions occurred
or in future taxable years. Any conclusion regarding PFIC status is a factual determination that must be made annually at the close of
each taxable year and, thus, is subject to change. In addition, even if NioCorp concluded it did not qualify as a PFIC, it is possible
that the U.S. Internal Revenue Service (the “IRS”) could assert, and that a court could sustain, a determination that NioCorp
is a PFIC.
Accordingly, there can be no assurance that NioCorp will not be
treated as a PFIC for any taxable year. Each holder of Common Shares should consult its own tax advisors regarding the PFIC rules and
the U.S. federal income tax consequences of the acquisition, ownership, and disposition of such securities. See “Certain United
States Federal Income Tax Considerations” below, for further details regarding this issue.
The Transactions could result in NioCorp becoming subject
to materially adverse U.S. federal income tax consequences.
Section 7874 and related sections of the U.S.
Internal Revenue Code of 1986, as amended (the “Code”), provide for certain adverse tax consequences when the stock of a U.S.
corporation is acquired by a non-U.S. corporation in certain transactions in which former shareholders of the U.S. corporation come to
own 60% or more of the stock of the non-U.S. corporation (by vote or value, and applying certain specific counting and ownership rules).
These adverse tax consequences include (i) potential additional required gain recognition by the U.S. corporation, (ii) treatment of certain
payments to the non-U.S. corporation that reduce gross income as “base erosion payments,” (iii) an excise tax on certain options
and stock-based compensation of the U.S. corporation, (iv) disallowance of “qualified dividend” treatment for distributions
by the non-U.S. corporation, and (v) if former shareholders of the U.S. corporation come to own 80% or more of the stock of the non-U.S.
corporation, treatment of the non-U.S. corporation as a U.S. corporation subject to U.S. federal income tax on its worldwide income (in
addition to any tax imposed by non-U.S. jurisdictions). If the Transactions result in the application of any of these, or any other, adverse
tax consequences, NioCorp could incur significant additional tax costs. While NioCorp currently does not believe the Transactions will
cause such adverse tax consequences as a result of section 7874 and related sections of the Code, this determination is subject to significant
legal and factual uncertainty. NioCorp has not sought and will not seek any rulings from the IRS as to the tax treatment of any of the
Transactions. Further, there can be no assurance that your tax advisor, the IRS, or a court, will agree with the position that NioCorp
is not subject to these adverse tax consequences.
CAUTIONARY NOTE
REGARDING FORWARD-LOOKING STATEMENTS
This
prospectus and the other documents incorporated by reference into this prospectus contain or may contain “forward-looking statements”
within the meaning of Section 27A of the Securities Act and Section 21E of the Exchange Act, and “forward-looking information”
within the meaning of applicable Canadian securities laws (collectively, “forward-looking statements”).
Forward-looking
statements have been based upon our current business and operating plans, as approved by the Company’s Board of Directors, and may
include statements regarding the anticipated benefits of the Transactions, including NioCorp’s ability to access the full amount
of the expected net proceeds of the Yorkville Equity Facility Financing Agreement over the next three years; NioCorp’s ability to
receive a final commitment of financing from the Export-Import Bank of the United States (“EXIM”); anticipated benefits of
the listing of the Common Shares on Nasdaq; 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 Elk Creek Project; NioCorp’s expectation and ability to produce niobium, scandium, and titanium at the Elk Creek Project; the
outcome of current recovery process improvement testing, and NioCorp’s expectation that such process improvements could lead to
greater efficiencies and cost savings in the Elk Creek Project; the Elk Creek Project’s ability to produce multiple critical metals;
the Elk Creek Project’s projected ore production and mining operations over its expected mine life; the completion of the demonstration
plant and technical and economic analyses on the potential addition of magnetic rare earth oxides to NioCorp's planned product suite;
the exercise of options to purchase additional land parcels; the execution of contracts with engineering, procurement and construction
companies; NioCorp’s ongoing evaluation of the impact of inflation, supply chain issues and geopolitical unrest on the Elk Creek
Project’s economic model; the impact of health epidemics, including the COVID-19 pandemic, on NioCorp’s business and the actions
NioCorp may take in response thereto; and the creation of full time and contract construction jobs over the construction period of the
Elk Creek Project.
Forward-looking
statements are frequently, but not always, identified by words such as “expects,” “anticipates,” “believes,”
“intends,” “estimates,” “potential,” “possible,” and similar expressions, or statements
that events, conditions, or results “will,” “may,” “could,” or “should” (or the negative
and grammatical variations of any of these terms) occur or be achieved. Any statements that express or involve discussions with respect
to predictions, expectations, beliefs, plans, projections, objectives, assumptions, or future events or performance (often, but not always,
using words or phrases such as “expects” or “does not expect,” “is expected,” “anticipates”
or “does not anticipate,” “plans,” “estimates,” or “intends,” or stating that certain
actions, events, or results “may,” “could,” “would,” “might,” or “will” be
taken, occur or be achieved) are not statements of historical fact and may be forward-looking statements. Such forward-looking statements
reflect the Company’s current views with respect to future 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 ability to recognize the anticipated benefits of the Transactions, including NioCorp’s ability
to access the full amount of the expected net proceeds under the Yorkville Equity Facility Financing Agreement over the next three years;
unexpected costs related to the Transactions; the outcome of any legal proceedings that may be instituted against NioCorp following closing
of the Transactions; NioCorp’s ability to receive a final commitment of financing from EXIM on the anticipated timeline, on acceptable
terms, or at all; NioCorp’s ability to continue to meet Nasdaq listing standards; NioCorp’s ability to operate as a going
concern; risks relating to the Common Shares, including price volatility, lack of dividend payments and dilution or the perception of
the likelihood any of the foregoing; NioCorp’s requirement of significant additional capital; the extent to which NioCorp’s
level of indebtedness and/or the terms contained in agreements governing NioCorp’s indebtedness or the Yorkville Equity Facility
Financing Agreement may impair NioCorp’s ability to obtain additional financing; covenants contained in agreements with NioCorp’s
secured creditors that may affect its assets; NioCorp’s limited operating history; NioCorp’s history of losses; the restatement
of NioCorp’s consolidated financial statements as of and for the fiscal years ended June 30, 2022 and 2021 and the interim periods
ended September 30, 2021, December 31, 2021, and March 31, 2022 and the impact of such restatement on NioCorp’s future financial
statements and other financial measures; the material weakness in NioCorp’s internal control over financial reporting, NioCorp’s
efforts to remediate such material weakness and the timing of remediation; the possibility that NioCorp may qualify as a PFIC under the
Code; the potential that the Transactions could result in
NioCorp becoming subject to materially adverse U.S. federal income
tax consequences as a result of the application of Section 7874 and related sections of the Code; cost increases for NioCorp’s exploration
and, if warranted, development projects; a disruption in, or failure of, NioCorp’s information technology systems, including those
related to cybersecurity; equipment and supply shortages; current and future offtake agreements, joint ventures, and partnerships; NioCorp’s
ability to attract qualified management; the effects of the COVID-19 pandemic or other global health crises on NioCorp’s business
plans, financial condition and liquidity; estimates of mineral resources and reserves; mineral exploration and production activities;
feasibility study results; the results of metallurgical testing; changes in demand for and price of commodities (such as fuel and electricity)
and currencies; competition in the mining industry; changes or disruptions in the securities markets; legislative, political or economic
developments, including changes in federal and/or state laws that may significantly affect the mining industry; the impacts of climate
change, as well as actions taken or required by governments related to strengthening resilience in the face of potential impacts from
climate change; the need to obtain permits and comply with laws and regulations and other regulatory requirements; the timing and reliability
of sampling and assay data; the possibility that actual results of work may differ from projections/expectations or may not realize the
perceived potential of NioCorp’s projects; risks of accidents, equipment breakdowns, and labor disputes or other unanticipated
difficulties or interruptions; the possibility of cost overruns or unanticipated expenses in development programs; operating or technical
difficulties in connection with exploration, mining, or development activities; the management of the water balance at the Elk Creek Project
site; land reclamation requirements related to the Elk Creek Project; the speculative nature of mineral exploration and development, including
the risks of diminishing quantities of grades of reserves and resources; claims on the title to NioCorp’s properties; potential
future litigation; and NioCorp’s lack of insurance covering all of NioCorp’s operations.
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 Part I, Item 1A. “Risk Factors” contained in our most
recent Annual Report on Form 10-K, and Part II, Item 1A. “Risk Factors” contained in our subsequent Quarterly Reports on Form
10-Q, as well as any amendments thereto, which are incorporated by reference into this prospectus and the applicable prospectus supplement
in their entirety, together with other information in this prospectus and the applicable prospectus supplement and the documents incorporated
by reference herein and therein. See the sections of this prospectus entitled “Where You Can Find More Information” and “Incorporation
of Documents by Reference.”
The Company’s
forward-looking statements contained in this prospectus are based on the beliefs, expectations, and opinions of management as of the date
of this prospectus. 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.
USE OF PROCEEDS
This prospectus relates to Common Shares that
may be offered and sold from time to time by the Selling Shareholders. All of the Common Shares offered by the Selling Shareholders pursuant
to this prospectus will be sold by the Selling Shareholders for their own account. We will not receive any of the proceeds from these
sales.
However, we will receive the cash exercise
price of the Warrants upon exercise thereof (assuming, with respect to the Financing Warrants, that the holders do not exercise their
Financing Warrants on a cashless basis, which they may not do for so long as there is an effective registration statement registering,
and a current prospectus available for, the resale of the Common Shares thereunder, including this prospectus and the registration statement
of which this prospectus is a part). We believe the likelihood that Warrant holders will exercise their Warrants, and therefore the amount
of cash proceeds that we would receive, is, among other things, dependent upon the market price of our Common Shares. For so long as the
market price for our Common Shares is less than the applicable exercise price (as is the case as of the date of this prospectus), we believe
such holders will be unlikely to exercise their Warrants. We expect to use the net proceeds that we receive from the exercise of the Warrants,
if any, for working capital and general corporate purposes, including to advance our efforts to launch construction of the Elk Creek Project
and move it to commercial operation.
DETERMINATION
OF OFFERING PRICE
We cannot currently determine the price or
prices at which Common Shares may be sold by the Selling Shareholders under this prospectus as the price will be determined by the prevailing
public market price for our Common Shares, by negotiations between the Selling Shareholders and the buyers of Common Shares in private
transactions or as otherwise described in “Plan of Distribution.”
SELLING SHAREHOLDERS
This prospectus relates to the offer and sale
from time to time of up to an aggregate of 10,495,370 Common Shares, consisting of (a) up to 8,211,892 Common Shares issuable to YA upon
conversion of the Convertible Debentures, (b) up to 1,789,267 Common Shares issuable to YA upon exercise of the Financing Warrants, which
are exercisable for cash or, if at any time there is no effective registration statement registering, or no current prospectus available
for, the resale of the Common Shares thereunder, 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, (c) up to 487,701 Common Shares issuable upon exercise of the Private Placement Warrants, each exercisable
for one Common Share for cash at a price per Common Share of C$11.00, subject to adjustment for recapitalizations, stock splits, reverse
stock splits and similar events, and (d) up to 6,510 Common Shares issuable upon exercise of the Finder Warrants, each exercisable for
one Common Share for cash at a price per Common Share of C$11.00, subject to adjustment for recapitalizations, stock splits, reverse stock
splits and similar events. For additional information regarding the issuances of Common Shares covered by this prospectus, see the section
titled “Summary—Background.” Except for the transactions contemplated by the Yorkville Convertible Debt Financing Agreement
and the Yorkville Equity Facility Financing Agreement, YA does not, and has not had, any material relationship with us. With the exception
of Lind Global Asset Management III, LLC, none of the Private Placement Investors has, or has had, any material relationship with us.
The Company previously issued to Lind Global Asset Management III, LLC a convertible security, which is no longer outstanding, and Common
Share purchase warrants, exercisable at a price per Common Share of C$9.70, expiring February 19, 2025 (the “Lind Warrants”),
pursuant to a convertible security funding agreement, dated as of February 16, 2021.
The table below presents information regarding
the Selling Shareholders and the Common Shares that they may offer from time to time under this prospectus. This table is prepared based
on information supplied to us by the Selling Shareholders. The number of Common Shares in the column “Maximum Number of Common Shares
to be Offered Pursuant to this Prospectus” represents all of the Common Shares that the Selling Shareholders may offer under this
prospectus. The Selling Shareholders may sell some, all or none of their Common Shares covered by this prospectus in this offering. We
do not know how long the Selling Shareholders will hold the Common Shares before selling them, and we currently have no agreements, arrangements
or understandings with the Selling Shareholders regarding the sale of any of the Common Shares the Selling Shareholders may offer under
this prospectus.
Beneficial ownership is determined in accordance
with Rule 13d-3(d) promulgated by the SEC under the Exchange Act, and includes Common Shares with respect to which the Selling Shareholders
have voting or investment power. The percentage of Common Shares beneficially owned by the Selling Shareholders prior to and after the
offering shown in the table below is based on an aggregate of 30,396,120 Common Shares outstanding on May 4, 2023. The number
of Common Shares that may actually be issued by us upon conversion of the Convertible Debentures and exercise of the Warrants may be fewer
than the number of Common Shares being offered by this prospectus. The fourth column assumes the issuance of all of the Common Shares
offered by the Selling Shareholders pursuant to this prospectus.
Except as otherwise described below, based
on the information provided to us by the Selling Shareholders, none of the Selling Shareholders is a broker-dealer or an affiliate of
a broker-dealer.
Name
of Selling Shareholder |
Number
of Common Shares Beneficially Owned
Prior to Offering
|
Maximum
Number of
Common Shares to
be Offered
Pursuant to this
Prospectus
|
Number
of Common Shares Beneficially Owned
After Offering
|
Number |
Percent |
Number |
Percent |
| YA II PN, Ltd. (1) |
10,082,372 |
24.96% |
10,001,159 |
81,213 |
* |
| Lind Global Asset Management III, LLC (2) |
962,188 |
3.07% |
36,458 |
925,730 |
2.21% |
| Steve Everhart (3) |
392,774 |
1.29% |
65,337 |
327,437 |
* |
Name
of Selling Shareholder |
Number of Common
Shares Beneficially Owned
Prior to Offering
|
Maximum
Number of
Common Shares to
be Offered
Pursuant to this
Prospectus
|
Number of Common
Shares Beneficially Owned
After Offering
|
Number |
Percent |
Number |
Percent |
| Gerardus M.M. Op De Weegh (4) |
1,000 |
* |
1,000 |
— |
— |
| Luc Jansen (5) |
62,500 |
* |
6,000 |
56,500 |
* |
| Kenneth Thoonen (6) |
23,985 |
* |
6,000 |
17,985 |
* |
| Eva Jasja van der Haar (7) |
5,000 |
* |
750 |
4,250 |
* |
| Wim Bakker (8) |
1,770 |
* |
520 |
1,250 |
* |
| Benedikt Bruggeman (9) |
21,500 |
* |
5,000 |
16,500 |
* |
| Rene Clignett (10) |
61,530 |
* |
6,500 |
55,030 |
* |
| Klaas de Groot (11) |
6,250 |
* |
2,000 |
4,250 |
* |
| Jozef D'Hauwe (12) |
3,600 |
* |
1,000 |
2,600 |
* |
| Willemina Johanna de Vries-Mulder (13) |
13,250 |
* |
5,000 |
8,250 |
* |
| Hassan Ghrib (14) |
13,630 |
* |
5,000 |
8,630 |
* |
Bennie
Hoornveld (15) |
7,696 |
* |
3,000 |
4,696 |
* |
| Hans Janshen (16) |
32,300 |
* |
10,000 |
22,300 |
* |
| Marc Joosten (17) |
29,600 |
* |
10,000 |
19,600 |
* |
| La Montagne Beheer B.V. (18) |
2,200 |
* |
1,000 |
1,200 |
* |
| Alwin Leltz (19) |
3,000 |
* |
1,000 |
2,000 |
* |
| Ramon Salceda (20) |
8,086 |
* |
1,000 |
7,086 |
* |
| Alwin Tetteroo (21) |
22,574 |
* |
6,000 |
16,574 |
* |
| Peter Tromp (22) |
24,750 |
* |
10,000 |
14,750 |
* |
Toon van
Ginderen (23) |
9,500 |
* |
5,000 |
4,500 |
* |
Christa van
Ittersum (24) |
21,291 |
* |
10,000 |
11,291 |
* |
| Dirk MCA van Meteren (25) |
60,000 |
* |
2,500 |
57,500 |
* |
| Renny van Wijk (26) |
20,000 |
* |
10,000 |
10,000 |
* |
| Joannes Peter van Wijk (27) |
8,300 |
* |
2,500 |
5,800 |
* |
Anthonie van
Zalk (28) |
11,500 |
* |
5,000 |
6,500 |
* |
Martin
Vandamme (29) |
19,500 |
* |
9,000 |
10,500 |
* |
| Edo Veenis (30) |
14,000 |
* |
3,000 |
11,000 |
* |
| Jozeph Verbon (31) |
17,150 |
* |
5,000 |
12,150 |
* |
Adrianus
Verburg (32) |
18,190 |
* |
6,000 |
12,190 |
* |
| Mark Verhaaren (33) |
5,000 |
* |
2,500 |
2,500 |
* |
| Kees Volders (34) |
10,921 |
* |
1,000 |
9,921 |
* |
| Earth Labs Inc. (35) |
25,000 |
* |
12,500 |
12,500 |
— |
| James Rowland (36) |
2,680 |
* |
1,340 |
1,340 |
* |
| Advisir Venture (37) |
10,416 |
* |
10,416 |
— |
|
Gloria
Christilaw (38) |
17,663 |
* |
7,100 |
10,563 |
* |
Name
of Selling Shareholder |
Number of Common
Shares Beneficially Owned
Prior to Offering
|
Maximum
Number of
Common Shares to
be Offered
Pursuant to this
Prospectus
|
Number of Common
Shares Beneficially Owned
After Offering
|
Number |
Percent |
Number |
Percent |
David Christilaw and/or Gloria Christilaw
JTWROS (39) |
13,073 |
* |
7,200 |
5,873 |
* |
| Sarah Christilaw (40) |
18,569 |
* |
7,000 |
11,569 |
* |
Adam Christilaw and/or Hayley Christilaw
JTWROS (41) |
15,583 |
* |
4,900 |
10,683 |
* |
Hayley
Christilaw (42) |
12,515 |
* |
4,000 |
8,515 |
* |
| Don Heath (43) |
39,730 |
* |
14,800 |
24,930 |
* |
| Debby Heath (44) |
23,830 |
* |
8,100 |
15,730 |
* |
| Vance Merson and/or Ellen Merson JTWROS (45) |
5,600 |
* |
3,100 |
2,500 |
* |
| Maria Elizabeth Moore (46) |
47,900 |
* |
12,250 |
35,650 |
* |
| Donna Kings (47) |
12,500 |
* |
3,000 |
9,500 |
* |
| Don Ambeau (48) |
14,900 |
* |
4,700 |
10,200 |
* |
| Marva Usher (49) |
13,480 |
* |
5,000 |
8,480 |
* |
| Michelle Amey (50) |
16,516 |
* |
5,000 |
11,516 |
* |
| David Christilaw (51) |
121,321 |
* |
36,100 |
85,221 |
* |
| Adam Christilaw (52) |
61,120 |
* |
20,850 |
40,270 |
* |
| Colleen Fox (53) |
25,640 |
* |
10,000 |
15,640 |
* |
| Chris Young (54) |
91,800 |
* |
17,900 |
73,900 |
* |
| Weber Investment Corporation (55) |
174,500 |
* |
45,000 |
129,500 |
* |
| Robert M Laird (56) |
11,669 |
* |
3,380 |
8,289 |
* |
| Research Capital Corporation (57) |
14,276 |
* |
6,480 |
7,796 |
* |
| Red Cloud Mining Capital Inc. (58) |
30 |
* |
30 |
— |
— |
| Total |
12,787,218 |
29.61% |
10,495,370 |
2,291,848 |
7.25% |
| * | Represents ownership of less than 1%. |
| (1)
|
Beneficial
ownership includes (a) 81,213 Commitment Shares; (b) an estimated 8,211,892 Common Shares issuable upon conversion of the
Convertible Debentures, assuming (i) the conversion of all $16,000,000 aggregate principal amount of the Convertible Debentures,
plus $1,602,192 of accrued interest, (ii) a conversion price equal to the Floor Price (as defined herein) of $2.1435 and (iii) none
of the limitations on conversion of the Convertible Debentures set forth in the Yorkville Convertible Debt Financing Agreement
apply; and (c) 1,789,267 Common Shares issuable upon exercise of the Financing Warrants, assuming (i) none of the holders of the
Financing Warrants elects cashless exercise and (ii) none of the limitations on exercise of the Financing Warrants set forth the
Yorkville Convertible Debt Financing Agreement apply. Pursuant to the terms of the Convertible Debentures and the Financing
Warrants, YA may not convert Convertible Debentures or exercise Financing Warrants into Common Shares in an amount that would result
in YA (or its affiliates) beneficially owning (as determined in accordance with Section 13(d) of the Exchange Act and the rules
promulgated thereunder) more than 4.99% of the Common Shares outstanding immediately after giving effect to such conversion or
exercise or receipt of shares (the “Beneficial Ownership Limitation”); provided that YA may waive the Beneficial
Ownership Limitation upon not less than 65 days’ prior notice to NioCorp. In accordance with Rule 13d-3(d) under the Exchange
Act, we have excluded from the number of Common Shares beneficially owned prior to and after the offering all of the Common Shares
that YA may be required to purchase under the Yorkville Equity Facility Financing Agreement, because the issuance of such Common
Shares is solely at our discretion and is subject to conditions contained in the Yorkville Equity Facility Financing Agreement, the
satisfaction of which are entirely outside of YA’s control. YA is a fund managed by Yorkville Advisors Global, LP. Yorkville
Advisors Global II, LLC is the General Partner of Yorkville Advisors Global, LP. All investment decisions for YA are made by
Yorkville Advisors Global II, LLC’s President and Managing Member, Mr. Mark Angelo. The business address of YA is 1012
Springfield Avenue, Mountainside, NJ 07092. |
| (2)
|
The
Selling Shareholder, Lind Global Asset Management III, LLC, is the registered owner of the Common Shares. The jurisdiction of the
Selling Shareholder is the United States. Each of Lind Global Macro Fund, LP, the sole member of Lind Global Asset Management III,
LLC, Lind Global Partners LLC, the general partner of Lind Global Macro Fund, LP, and Jeff Easton, the managing member of Lind Global
Macro Fund, LP, have voting and investment power over the Common Shares and may be deemed to be a beneficial owner. Beneficial ownership
includes (a) 855,800 Common Shares issuable upon exercise of the Lind Warrants, (b) 69,930 Common Shares issuable upon exercise
of Common Share purchase warrants, exercisable at a price per Common Share of C$16.30, expiring May 10, 2023, issued in the Company’s
May 2021 non-brokered private placement (the “May 2021 Warrants”), and (c) 36,458 Common Shares issuable upon exercise
of Private Placement Warrants. The Selling Shareholder is offering pursuant to this prospectus 36,458 Common Shares issuable upon
exercise of Private Placement Warrants. |
| (3)
|
The
Selling Shareholder, Steve Everhart, has sole voting and investment power over the Common Shares. The jurisdiction of the Selling
Shareholder is the United States. Beneficial ownership includes (a) 312,500 Common Shares, (b) 14,937 Common Shares issuable upon
exercise of May 2021 Warrants, and (c) 65,337 Common Shares issuable upon exercise of Private Placement Warrants. The Selling Shareholder
is offering pursuant to this prospectus 65,337 Common Shares issuable upon exercise of Private Placement Warrants. |
| (4)
|
The
Selling Shareholder, Gerardus M.M. Op De Weegh, has sole voting and investment power over the Common Shares. The jurisdiction of
the Selling Shareholder is Aruba. Beneficial ownership includes 1,000 Common Shares issuable upon exercise of Private Placement Warrants.
The Selling Shareholder is offering pursuant to this prospectus 1,000 Common Shares issuable upon exercise of Private Placement Warrants. |
| (5)
|
The
Selling Shareholder, Luc Jansen, has sole voting and investment power over the Common Shares. The jurisdiction of the Selling Shareholder
is Belgium. Beneficial ownership includes (a) 56,500 Common Shares and (b) 6,000 Common Shares issuable upon exercise of Private
Placement Warrants. The Selling Shareholder is offering pursuant to this prospectus 6,000 Common Shares issuable upon exercise of
Private Placement Warrants. |
| (6)
|
The
Selling Shareholder, Kenneth Thoonen, has sole voting and investment power over the Common Shares. The jurisdiction of the Selling
Shareholder is Belgium. Beneficial ownership includes (a) 17,985 Common Shares and (b) 6,000 Common Shares issuable upon exercise
of Private Placement Warrants. The Selling Shareholder is offering pursuant to this prospectus 6,000 Common Shares issuable upon
exercise of Private Placement Warrants. |
| (7)
|
The
Selling Shareholder, Eva Jasja van der Haar, has sole voting and investment power over the Common Shares. The jurisdiction of the
Selling Shareholder is The Netherlands. Beneficial ownership includes (a) 4,250 Common Shares and (b) 750 Common Shares issuable
upon exercise of Private Placement Warrants. The Selling Shareholder is offering pursuant to this prospectus 750 Common Shares issuable
upon exercise of Private Placement Warrants. |
| (8)
|
The
Selling Shareholder, Wim Bakker, has sole voting and investment power over the Common Shares. The jurisdiction of the Selling Shareholder
is The Netherlands. Beneficial ownership includes (a) 500 Common Shares, (b) 750 Common Shares issuable upon exercise of May 2021
Warrants, and (c) 520 Common Shares issuable upon exercise of Private Placement Warrants. The Selling Shareholder is offering pursuant
to this prospectus 520 Common Shares issuable upon exercise of Private Placement Warrants. |
| (9)
|
The
Selling Shareholder, Benedikt Bruggeman, has sole voting and investment power over the Common Shares. The jurisdiction of the Selling
Shareholder is Belgium. Beneficial ownership includes (a) 15,000 Common Shares, (b) 1,500 Common Shares issuable upon exercise of
May 2021 Warrants, and (c) 5,000 Common Shares issuable upon exercise of Private Placement Warrants. The Selling Shareholder is offering
pursuant to this prospectus 5,000 Common Shares issuable upon exercise of Private Placement Warrants. |
| (10)
|
The
Selling Shareholder, Rene Clignett, has sole voting and investment power over the Common Shares. The jurisdiction of the Selling
Shareholder is The Netherlands. Beneficial ownership includes (a) 53,530 Common Shares, (b) 1,500 Common Shares issuable upon exercise
of May 2021 Warrants, and (c) 6,500 Common Shares issuable upon exercise of Private Placement Warrants. The Selling Shareholder is
offering pursuant to this prospectus 6,500 Common Shares issuable upon exercise of Private Placement Warrants. |
| (11)
|
The
Selling Shareholder, Klaas de Groot, has sole voting and investment power over the Common Shares. The jurisdiction of the Selling
Shareholder is The Netherlands. Beneficial ownership includes (a) 2,000 Common Shares, (b) 2,250 Common Shares issuable upon exercise
of May 2021 Warrants, and (c) 2,000 Common Shares issuable upon exercise of Private Placement Warrants. The Selling Shareholder is
offering pursuant to this prospectus 2,000 Common Shares issuable upon exercise of Private Placement Warrants. |
| (12)
|
The
Selling Shareholder, Jozef D'Hauwe, has sole voting and investment power over the Common Shares. The jurisdiction of the Selling
Shareholder is Belgium. Beneficial ownership includes (a) 2,600 Common Shares and (b) 1,000 Common Shares issuable upon exercise
of Private Placement Warrants. The Selling Shareholder is offering pursuant to this prospectus 1,000 Common Shares issuable upon
exercise of Private Placement Warrants. |
| (13)
|
The
Selling Shareholder, Willemina Johanna de Vries-Mulder, has sole voting and investment power over the Common Shares. The jurisdiction
of the Selling Shareholder is The Netherlands. Beneficial ownership includes (a) 6,750 Common Shares, (b) 1,500 Common Shares issuable
upon exercise of May 2021 Warrants, and (c) 5,000 Common Shares issuable upon exercise of Private Placement Warrants. The Selling
Shareholder is offering pursuant to this prospectus 5,000 Common Shares issuable upon exercise of Private Placement Warrants. |
| (14)
|
The
Selling Shareholder, Hassan Ghrib, has sole voting and investment power over the Common Shares. The jurisdiction of the Selling Shareholder
is The Netherlands. Beneficial ownership includes (a) 7,130 Common Shares, (b) 1,500 Common Shares issuable upon exercise of May
2021 Warrants, and (c) 5,000 Common Shares issuable upon exercise of Private Placement Warrants. The Selling Shareholder is offering
pursuant to this prospectus 5,000 Common Shares issuable upon exercise of Private Placement Warrants. |
| (15)
|
The
Selling Shareholder, Bennie Hoornveld, has sole voting and investment power over the Common Shares. The jurisdiction of the Selling
Shareholder is The Netherlands. Beneficial ownership includes (a) 3,196 Common Shares, (b) 1,500 Common Shares issuable upon exercise
of May 2021 Warrants, and (c) 3,000 Common Shares issuable upon exercise of Private Placement Warrants. The Selling Shareholder is
offering pursuant to this prospectus 3,000 Common Shares issuable upon exercise of Private Placement Warrants. |
| (16)
|
The
Selling Shareholder, Hans Janshen, has sole voting and investment power over the Common Shares. The jurisdiction of the Selling Shareholder
is The Netherlands. Beneficial ownership includes (a) 20,800 Common Shares, (b) 1,500 Common Shares issuable upon exercise of May
2021 Warrants, and (c) 10,000 Common Shares issuable upon exercise of Private Placement Warrants. The Selling Shareholder is offering
pursuant to this prospectus 10,000 Common Shares issuable upon exercise of Private Placement Warrants. |
| (17)
|
The
Selling Shareholder, Marc Joosten, has sole voting and investment power over the Common Shares. The jurisdiction of the Selling Shareholder
is The Netherlands. Beneficial ownership includes (a) 16,600 Common Shares, (b) 3,000 Common Shares issuable upon exercise of May
2021 Warrants, and (c) 10,000 Common Shares issuable upon exercise of Private Placement Warrants. The Selling Shareholder is offering
pursuant to this prospectus 10,000 Common Shares issuable upon exercise of Private Placement Warrants. |
| (18)
|
The
Selling Shareholder, La Montagne Beheer B.V., is the registered owner of the Common Shares. The jurisdiction of the Selling Shareholder
is The Netherlands. PJ van Bergen, Director of La Montagne Beheer B.V., has voting and investment power over the Common Shares and
may be deemed to be a beneficial owner. Beneficial ownership includes (a) 1,200 Common Shares and (b) 1,000 Common Shares issuable
upon exercise of Private Placement Warrants. The Selling Shareholder is offering pursuant to this prospectus 1,000 Common Shares
issuable upon exercise of Private Placement Warrants. |
| (19)
|
The
Selling Shareholder, Alwin Leltz, has sole voting and investment power over the Common Shares. The jurisdiction of the Selling Shareholder
is The Netherlands. Beneficial ownership includes (a) 2,000 Common Shares and (b) 1,000 Common Shares issuable upon exercise of Private
Placement Warrants. The Selling Shareholder is offering pursuant to this prospectus 1,000 Common Shares issuable upon exercise of
Private Placement Warrants. |
| (20)
|
The
Selling Shareholder, Ramon Salceda, has sole voting and investment power over the Common Shares. The jurisdiction of the Selling
Shareholder is The Netherlands. Beneficial ownership includes (a) 7,086 Common Shares and (b) 1,000 Common Shares issuable upon exercise
of Private Placement Warrants. The Selling Shareholder is offering pursuant to this prospectus 1,000 Common Shares issuable upon
exercise of Private Placement Warrants. |
| (21)
|
The
Selling Shareholder, Alwin Tetteroo, has sole voting and investment power over the Common Shares. The jurisdiction of the Selling
Shareholder is The Netherlands. Beneficial ownership includes (a) 15,074 Common Shares, (b) 1,500 Common Shares issuable upon exercise
of May 2021 Warrants, and (c) 6,000 Common Shares issuable upon exercise of Private Placement Warrants. The Selling Shareholder is
offering pursuant to this prospectus 6,000 Common Shares issuable upon exercise of Private Placement Warrants. |
| (22)
|
The
Selling Shareholder, Peter Tromp, has sole voting and investment power over the Common Shares. The jurisdiction of the Selling Shareholder
is The Netherlands. Beneficial ownership includes (a) 14,000 Common Shares, (b) 750 Common Shares issuable upon exercise of May 2021
Warrants, and (c) 10,000 Common Shares issuable upon exercise of Private Placement Warrants. The Selling Shareholder is offering
pursuant to this prospectus 10,000 Common Shares issuable upon exercise of Private Placement Warrants. |
| (23)
|
The
Selling Shareholder, Toon van Ginderen, has sole voting and investment power over the Common Shares. The jurisdiction of the Selling
Shareholder is The Netherlands. Beneficial ownership includes (a) 4,500 Common Shares issuable upon exercise of May 2021 Warrants
and (b) 5,000 Common Shares issuable upon exercise of Private Placement Warrants. The Selling Shareholder is offering pursuant to
this prospectus 5,000 Common Shares issuable upon exercise of Private Placement Warrants. |
| (24)
|
The
Selling Shareholder, Christa van Ittersum, has sole voting and investment power over the Common Shares. The jurisdiction of the Selling
Shareholder is The Netherlands. Beneficial ownership includes (a) 11,291 Common Shares and (b) 10,000 Common Shares issuable
upon exercise of Private Placement Warrants. The Selling Shareholder is offering pursuant to this prospectus 10,000 Common Shares
issuable upon exercise of Private Placement Warrants. |
| (25)
|
The
Selling Shareholder, Dirk MCA van Meteren, has sole voting and investment power over the Common Shares. The jurisdiction of the Selling
Shareholder is The Netherlands. Beneficial ownership includes (a) 54,500 Common Shares, (b) 3,000 Common Shares issuable upon
exercise of May 2021 Warrants and (c) 2,500 Common Shares issuable upon exercise of Private Placement Warrants. The Selling Shareholder
is offering pursuant to this prospectus 2,500 Common Shares issuable upon exercise of Private Placement Warrants. |
| (26)
|
The
Selling Shareholder, Renny van Wijk, has sole voting and investment power over the Common Shares. The jurisdiction of the Selling
Shareholder is The Netherlands. Beneficial ownership includes (a) 10,000 Common Shares and (b) 10,000 Common Shares issuable upon
exercise of Private Placement Warrants. The Selling Shareholder is offering pursuant to this prospectus 10,000 Common Shares issuable
upon exercise of Private Placement Warrants. |
| (27)
|
The
Selling Shareholder, Joannes Peter van Wijk, has sole voting and investment power over the Common Shares. The jurisdiction of the
Selling Shareholder is The Netherlands. Beneficial ownership includes (a) 5,800 Common Shares and (b) 2,500 Common Shares issuable
upon exercise of Private Placement Warrants. The Selling Shareholder is offering pursuant to this prospectus 2,500 Common Shares
issuable upon exercise of Private Placement Warrants. |
| (28)
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The
Selling Shareholder, Anthonie van Zalk, has sole voting and investment power over the Common Shares. The jurisdiction of the Selling
Shareholder is The Netherlands. Beneficial ownership includes (a) 5,000 Common Shares, (b) 1,500 Common Shares issuable upon exercise
of May 2021 Warrants, and (c) 5,000 Common Shares issuable upon exercise of Private Placement Warrants. The Selling Shareholder is
offering pursuant to this prospectus 5,000 Common Shares issuable upon exercise of Private Placement Warrants. |
| (29)
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The
Selling Shareholder, Martin Vandamme, has sole voting and investment power over the Common Shares. The jurisdiction of the Selling
Shareholder is Belgium. Beneficial ownership includes (a) 9,000 Common Shares, (b) 1,500 Common Shares issuable upon exercise of
May 2021 Warrants, and (c) 9,000 Common Shares issuable upon exercise of Private Placement Warrants. The Selling Shareholder is offering
pursuant to this prospectus 9,000 Common Shares issuable upon exercise of Private Placement Warrants. |
| (30)
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The
Selling Shareholder, Edo Veenis, has sole voting and investment power over the Common Shares. The jurisdiction of the Selling Shareholder
is The Netherlands. Beneficial ownership includes (a) 11,000 Common Shares and (b) 3,000 Common Shares issuable upon exercise of
Private Placement Warrants. The Selling Shareholder is offering pursuant to this prospectus 3,000 Common Shares issuable upon exercise
of Private Placement Warrants. |
| (31)
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The
Selling Shareholder, Jozeph Verbon, has sole voting and investment power over the Common Shares. The jurisdiction of the Selling
Shareholder is The Netherlands. Beneficial ownership includes (a) 12,150 Common Shares and (b) 5,000 Common Shares issuable upon
exercise of Private Placement Warrants. The Selling Shareholder is offering pursuant to this prospectus 5,000 Common Shares issuable
upon exercise of Private Placement Warrants. |
| (32)
|
The
Selling Shareholder, Adrianus Verburg, has sole voting and investment power over the Common Shares. The jurisdiction of the Selling
Shareholder is The Netherlands. Beneficial ownership includes (a) 12,190 Common Shares and (b) 6,000 Common Shares issuable upon
exercise of Private Placement Warrants. The Selling Shareholder is offering pursuant to this prospectus 6,000 Common Shares issuable
upon exercise of Private Placement Warrants. |
| (33)
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The
Selling Shareholder, Mark Verhaaren, has sole voting and investment power over the Common Shares. The jurisdiction of the Selling
Shareholder is The Netherlands. Beneficial ownership includes (a) 2,500 Common Shares and (b) 2,500 Common Shares issuable upon exercise
of Private Placement Warrants. The Selling Shareholder is offering pursuant to this prospectus 2,500 Common Shares issuable upon
exercise of Private Placement Warrants. |
| (34)
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The
Selling Shareholder, Kees Volders, has sole voting and investment power over the Common Shares. The jurisdiction of the Selling Shareholder
is The Netherlands. Beneficial ownership includes (a) 9,171 Common Shares, (b) 750 Common Shares issuable upon exercise of May 2021
Warrants, and (c) 1,000 Common Shares issuable upon exercise of Private Placement Warrants. The Selling Shareholder is offering pursuant
to this prospectus 1,000 Common Shares issuable upon exercise of Private Placement Warrants. |
| (35)
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The
Selling Shareholder, Earth Labs Inc., is the registered owner of the Common Shares. The jurisdiction of the Selling Shareholder is
Canada. Mathew Wilson has voting and investment power over the Common Shares and may be deemed a beneficial owner. Beneficial ownership
includes (a) 12,500 Common Shares and (b) 12,500 Common Shares issuable upon exercise of Private Placement Warrants. The Selling
Shareholder is offering pursuant to this prospectus 12,500 Common Shares issuable upon exercise of Private Placement Warrants. |
| (36)
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The
Selling Shareholder, James Rowland, has sole voting and investment power over the Common Shares. The jurisdiction of the Selling
Shareholder is the United States. Beneficial ownership includes (a) 1,340 Common Shares and (b) 1,340 Common Shares issuable upon
exercise of Private Placement Warrants. The Selling Shareholder is offering pursuant to this prospectus 1,340 Common Shares issuable
upon exercise of Private Placement Warrants. |
| (37)
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The
Selling Shareholder, Advisir Venture, is the registered owner of the Common Shares. The jurisdiction of the Selling Shareholder is
Canada. Advisir Venture is a wholly owned subsidiary of Report Card Canada Media. Gary Kelly has voting and investment power over
the Common Shares and may be deemed to be a beneficial owner. Beneficial ownership includes 10,416 Common Shares issuable upon exercise
of Private Placement Warrants. The Selling Shareholder is offering pursuant to this prospectus 10,416 Common Shares issuable upon
exercise of Private Placement Warrants. |
| (38)
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The
Selling Shareholder, Gloria Christilaw, has sole voting and investment power over the Common Shares. The jurisdiction of the Selling
Shareholder is Canada. Beneficial ownership includes (a) 7,763 Common Shares, (b) 2,800 Common Shares issuable upon exercise of May
2021 Warrants, and (c) 7,100 Common Shares issuable upon exercise of Private Placement Warrants. The Selling Shareholder is offering
pursuant to this prospectus 7,100 Common Shares issuable upon exercise of Private Placement Warrants. Gloria Christilaw also has
voting and investment power over Common Shares that she beneficially owns with David Christilaw. See footnote 39. |
| (39)
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The
Selling Shareholders, David Christilaw and/or Gloria Christilaw JTWROS, have shared voting and investment power over the Common Shares.
The jurisdiction of the Selling Shareholders is Canada. Beneficial ownership includes (a) 5,873 Common Shares and (b) 7,200 Common
Shares issuable upon exercise of Private Placement Warrants. The Selling Shareholders are offering pursuant to this prospectus 7,200
Common Shares issuable upon exercise of Private Placement Warrants. |
| (40)
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The
Selling Shareholder, Sarah Christilaw, has sole voting and investment power over the Common Shares. The jurisdiction of the Selling
Shareholder is Canada. Beneficial ownership includes (a) 7,569 Common Shares, (b) 4,000 Common Shares issuable upon exercise of May
2021 Warrants, and (c) 7,000 Common Shares issuable upon exercise of Private Placement Warrants. The Selling Shareholder is offering
pursuant to this prospectus 7,000 Common Shares issuable upon exercise of Private Placement Warrants. |
| (41)
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The
Selling Shareholders, Adam Christilaw and/or Hayley Christilaw JTWROS, have shared voting and investment power over the Common Shares.
The jurisdiction of the Selling Shareholders is Canada. Beneficial ownership includes (a) 3,413 Common Shares, (b) 7,270 Common Shares
issuable upon exercise of May 2021 Warrants, and (c) 4,900 Common Shares issuable upon exercise of Private Placement Warrants. The
Selling Shareholders are offering pursuant to this prospectus 4,900 Common Shares issuable upon exercise of Private Placement Warrants. |
| (42)
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The
Selling Shareholder, Hayley Christilaw, has sole voting and investment power over the Common Shares. The jurisdiction of the Selling
Shareholder is Canada. Beneficial ownership includes (a) 4,015 Common Shares, (b) 4,500 Common Shares issuable upon exercise of May
2021 Warrants, and (c) 4,000 Common Shares issuable upon exercise of Private Placement Warrants. The Selling Shareholder is offering
pursuant to this prospectus 4,000 Common Shares issuable upon exercise of Private Placement Warrants. Hayley Christilaw also has
voting and investment power over Common Shares that she beneficially owns with Adam Christilaw. See footnote 41. |
| (43)
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The
Selling Shareholder, Don Heath, has sole voting and investment power over the Common Shares. The jurisdiction of the Selling Shareholder
is Canada. Beneficial ownership includes (a) 15,800 Common Shares, (b) 9,130 Common Shares issuable upon exercise of May 2021 Warrants,
and (c) 14,800 Common Shares issuable upon exercise of Private Placement Warrants. The Selling Shareholder is offering pursuant to
this prospectus 14,800 Common Shares issuable upon exercise of Private Placement Warrants. |
| (44)
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The
Selling Shareholder, Debby Heath, has sole voting and investment power over the Common Shares. The jurisdiction of the Selling Shareholder
is Canada. Beneficial ownership includes (a) 10,100 Common Shares, (b) 5,630 Common Shares issuable upon exercise of May 2021 Warrants,
and (c) 8,100 Common Shares issuable upon exercise of Private Placement Warrants. The Selling Shareholder is offering pursuant to
this prospectus 8,100 Common Shares issuable upon exercise of Private Placement Warrants. |
| (45)
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The
Selling Shareholders, Vance Merson and/or Ellen Merson JTWROS, have shared voting and investment power over the Common Shares. The
jurisdiction of the Selling Shareholder is Canada. Beneficial ownership includes (a) 2,500 Common Shares and (b) 3,100 Common Shares
issuable upon exercise of Private Placement Warrants. The Selling Shareholder is offering pursuant to this prospectus 3,100 Common
Shares issuable upon exercise of Private Placement Warrants. |
| (46)
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The
Selling Shareholder, Maria Elizabeth Moore, has sole voting and investment power over the Common Shares. The jurisdiction of the
Selling Shareholder is Canada. Beneficial ownership includes (a) 25,250 Common Shares, (b) 10,400 Common Shares issuable upon exercise
of May 2021 Warrants, and (c) 12,250 Common Shares issuable upon exercise of Private Placement Warrants. The Selling Shareholder
is offering pursuant to this prospectus 12,250 Common Shares issuable upon exercise of Private Placement Warrants. |
| (47)
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The
Selling Shareholder, Donna Kings, has sole voting and investment power over the Common Shares. The jurisdiction of the Selling Shareholder
is Canada. Beneficial ownership includes (a) 6,000 Common Shares, (b) 3,500 Common Shares issuable upon exercise of May 2021 Warrants,
and (c) 3,000 Common Shares issuable upon exercise of Private Placement Warrants. The Selling Shareholder is offering pursuant to
this prospectus 3,000 Common Shares issuable upon exercise of Private Placement Warrants. |
| (48)
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The
Selling Shareholder, Don Ambeau, has sole voting and investment power over the Common Shares. The jurisdiction of the Selling Shareholder
is Canada. Beneficial ownership includes (a) 6,700 Common Shares, (b) 3,500 Common Shares issuable upon exercise of May 2021 Warrants,
and (c) 4,700 Common Shares issuable upon exercise of Private Placement Warrants. The Selling Shareholder is offering pursuant to
this prospectus 4,700 Common Shares issuable upon exercise of Private Placement Warrants. |
| (49)
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The
Selling Shareholder, Marva Usher, has sole voting and investment power over the Common Shares. The jurisdiction of the Selling Shareholder
is Canada. Beneficial ownership includes (a) 4,980 Common Shares, (b) 3,500 Common Shares issuable upon exercise of May 2021 Warrants,
and (c) 5,000 Common Shares issuable upon exercise of Private Placement Warrants. The Selling Shareholder is offering pursuant to
this prospectus 5,000 Common Shares issuable upon exercise of Private Placement Warrants. |
| (50)
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The
Selling Shareholder, Michelle Amey, has sole voting and investment power over the Common Shares. The jurisdiction of the Selling
Shareholder is Canada. Beneficial ownership includes (a) 8,016 Common Shares, (b) 3,500 Common Shares issuable upon exercise of May
2021 Warrants, and (c) 5,000 Common Shares issuable upon exercise of Private Placement Warrants. The Selling Shareholder is offering
pursuant to this prospectus 5,000 Common Shares issuable upon exercise of Private Placement Warrants. |
| (51)
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The
Selling Shareholder, David Christilaw, has sole voting and investment power over the Common Shares. The securities beneficially owned
and offered hereunder are held by David Christilaw both through David Christilaw CHARTERED ACCOUNTANT PROFESSIONAL CORPORATION, a
professional corporation organized under the laws of Ontario and through a solely owned entity, 939042 Ontario Inc., a corporation
incorporated under the laws of Ontario, Canada. David Christilaw is the person at David Christilaw CHARTERED ACCOUNTANT PROFESSIONAL
CORPORATION and 939042 Ontario Inc. that exercises voting and investment power over the Common Shares. The jurisdiction of the Selling
Shareholder is Canada. Beneficial ownership includes (a) 55,521 Common Shares, (b) 29,700 Common Shares issuable upon exercise
of May 2021 Warrants, and (c) 36,100 Common Shares issuable upon exercise of Private Placement Warrants. The Selling Shareholder
is offering pursuant to this prospectus 36,100 Common Shares issuable upon exercise of Private Placement Warrants. David Christilaw
also has voting and investment power over Common Shares of the Company that he beneficially owns with Gloria Christilaw. See footnote
39. |
| (52)
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In addition to the Common
Shares and Common Share purchase warrants he owns individually, the Selling Shareholder, Adam Christilaw, has sole voting and investment
power over and may be deemed to be a beneficial owner of the Common Shares and Common Share purchase warrants registered in the name
of 2064501 Ontario Inc, a corporation incorporated under the laws of Canada. The jurisdiction of the Selling Shareholder is Canada.
Beneficial ownership includes (a) 18,710 Common Shares, (b) 21,560 Common Shares issuable upon exercise of May 2021 Warrants, and
(c) 20,850 Common Shares issuable upon exercise of Private Placement Warrants. The Selling Shareholder is offering pursuant to this
prospectus 20,850 Common Shares issuable upon exercise of Private Placement Warrants. Adam Christilaw also has voting and investment
power over Common Shares of the Company that he beneficially owns with Hayley Christilaw. See footnote 41. |
| (53)
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In
addition to the Common Shares and Common Share purchase warrants she owns individually, Colleen Fox has sole voting and investment
power over and may be deemed to be a beneficial owner of the Common Shares and Common Share purchase warrants registered in the name
of 2506764 Ontario Inc., a corporation incorporated under the laws of Canada. The jurisdiction of the Selling Shareholder is Canada.
Beneficial ownership includes (a) 10,010 Common Shares, (b) 5,630 Common Shares issuable upon exercise of May 2021 Warrants and (c)
10,000 Common Shares issuable upon exercise of Private Placement Warrants. The Selling Shareholder is offering pursuant to this prospectus
10,000 Common Shares issuable upon exercise of Private Placement Warrants. |
| (54)
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In
addition to the Common Shares and Common Share purchase warrants he owns individually, Chris Young has sole voting and investment
power over and may be deemed to be a beneficial owner of the Common Shares and Common Share purchase warrants registered in the name
of 1589835 Ontario Inc., a corporation incorporated under the laws of Canada. The jurisdiction of the Selling Shareholder is Canada.
Beneficial ownership includes (a) 52,900 Common Shares, (b) 21,000 Common Shares issuable upon exercise of May 2021 Warrants, and
(c) 17,900 Common Shares issuable upon exercise of Private Placement Warrants. The Selling Shareholder is offering pursuant to this
prospectus 17,900 Common Shares issuable upon exercise of Private Placement Warrants. |
| (55)
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The
Selling Shareholder, Weber Investment Corporation, is the registered owner of the Common Shares and Common Share purchase warrants.
The jurisdiction of the Selling Shareholder is Canada. Gary Weber has sole voting and investment power over the Common Shares and
may be deemed to be a beneficial owner. Beneficial ownership includes (a) 95,000 Common Shares, (b) 34,500 Common Shares issuable
upon exercise of May 2021 Warrants, and (c) 45,000 Common Shares issuable upon exercise of Private Placement Warrants. The Selling
Shareholder is offering pursuant to this prospectus 45,000 Common Shares issuable upon exercise of Private Placement Warrants. |
| (56)
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The
Selling Shareholder, Robert M Laird, has sole voting and investment power over the Common Shares. The jurisdiction of the Selling
Shareholder is the United States. Beneficial ownership includes (a) 8,289 Common Shares and (b) 3,380 Common Shares issuable upon
exercise of Private Placement Warrants. The Selling Shareholder is offering pursuant to this prospectus 3,380 Common Shares issuable
upon exercise of Private Placement Warrants. |
| (57)
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The
Selling Shareholder, Research Capital Corporation, is the registered owner of Common Share purchase warrants. The jurisdiction of
the Selling Shareholder is Canada. Patrick Walsh has sole voting and investment power over the Common Shares and may be deemed to
be a beneficial owner. Beneficial ownership includes (a) 7,796 Common Shares issuable upon exercise of Common Share purchase warrants,
exercisable at C$16.30, expiring May 10, 2023, and (b) 6,480 Common Shares issuable upon exercise of Finder Warrants. The Selling
Shareholder is offering pursuant to this prospectus 6,480 Common Shares issuable upon exercise of Finder Warrants. Research Capital
Corporation received the Finder Warrants being offered pursuant to this prospectus as part of a finder’s fee for services rendered
in connection with the June 2022 Private Placement. |
| (58)
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The
Selling Shareholder, Red Cloud Mining Capital Inc., is the registered owner of Common Share purchase warrants. The jurisdiction of
the Selling Shareholder is Canada. Bruce Tatters, the Chief Executive Officer of Red Cloud Mining Capital Inc., has sole voting and
investment power over the Common Shares and may be deemed to be a beneficial owner. Beneficial ownership includes 30 Common Shares
issuable upon exercise of Finder Warrants. The Selling Shareholder is offering pursuant to this prospectus 30 Common Shares issuable
upon exercise of Finder Warrants. Red Cloud Mining Capital Inc. received the Finder Warrants being offered pursuant to this prospectus
as part of a finder’s fee for services rendered in connection with the June 2022 Private Placement. |
Description
of Capital Stock
Common Shares
The authorized capital of the Company consists
of an unlimited number of Common Shares, without par value. The holders of Common Shares are entitled to receive notice of and attend
all meetings of shareholders, with each Common Share held entitling the holder to one vote on any resolution to be passed at such shareholder
meetings. The holders of Common Shares are entitled to dividends if, as and when declared by the Company’s Board of Directors. The
Common Shares are entitled, upon liquidation, dissolution, or winding up of the Company, to receive the remaining assets of the Company
available for distribution to shareholders. There are no pre-emptive, conversion, or redemption rights attached to the Common Shares.
Exchange Controls
There are no governmental laws, decrees, or
regulations in Canada that restrict the export or import of capital, including foreign exchange controls, or that affect the remittance
of dividends, interest or other payments to non-resident holders of the securities of the Company, other than as discussed below and Canadian
withholding tax. See “Certain Canadian Federal Income Tax Considerations for U.S. Residents” below.
Competition Act
Limitations on the ability to acquire and hold
Common Shares may be imposed by the Competition Act (Canada). This legislation permits the Commissioner of Competition of Canada (the
“Commissioner”) to review any acquisition of a significant interest in the Company. This legislation grants the Commissioner
jurisdiction to challenge such an acquisition before the Canadian Competition Tribunal if the Commissioner believes that it would, or
would be likely to, result in a substantial lessening or prevention of competition in any market in Canada.
Investment Canada Act
The Investment Canada Act subjects an acquisition
of control of a company by a non-Canadian to government review if the enterprise value of such company, as calculated pursuant to the
legislation, exceeds a threshold amount. A reviewable acquisition may not proceed unless the relevant minister is satisfied that the investment
is likely to result in a net benefit to Canada. Under the national-security-review regime in the Investment Canada Act, review on a discretionary
basis may also be undertaken by the federal government in respect of a broad range of investments by a non-Canadian. No financial threshold
applies to a national security review. The relevant test is whether such investment by a non-Canadian could be “injurious to national
security.”
Warrants
From time to time, the Company has outstanding
Common Share purchase warrants, with each Common Share purchase warrant exercisable for one Common Share. The exercise price per Common
Share and the number of Common Shares issuable upon exercise of Common Share purchase warrants is subject to adjustment upon the occurrence
of certain events, including, but not limited to, the following:
| • | the subdivision or re-division of the outstanding
Common Shares into a greater number of Common Shares; |
| • | the reduction, combination or consolidation of
the outstanding Common Shares into a lesser number of Common Shares; |
| • | the issuance of Common Shares or securities exchangeable
for, or convertible into, Common Shares to all or substantially all of the holders of Common Shares by way of stock dividend or other
distribution (other than a distribution of Common Shares upon the exercise of Common Share purchase warrants or any outstanding options); |
| • | the reorganization of the Company or the consolidation
or merger or amalgamation of the Company with or into another body corporate; and |
| • | a reclassification or other similar change to
the outstanding Common Shares. |
The Company will issue the Common Shares issuable upon exercise of Common
Share purchase warrants within five business days following its receipt of notice of exercise and payment of the exercise price, subject
to surrender of the Common Share purchase warrants. Prior to the exercise of any Common Share purchase warrants, holders of the Common
Share purchase warrants will not have any of the rights of holders of the Common Shares issuable upon exercise, including the right to
vote or to receive any payments of dividends on the Common Shares issuable upon exercise.
NioCorp Assumed Warrants
In connection
with the Closing, pursuant to the Business Combination Agreement, the Company assumed the GXII Warrant Agreement and each GXII Warrant
thereunder that was issued and outstanding immediately prior to the Closing Date was converted into
one NioCorp Assumed Warrant pursuant to the NioCorp Assumed Warrant Agreement. In connection with the Closing, NioCorp issued (a) 9,999,959
public NioCorp Assumed Warrants in respect of the GXII Warrants that were publicly traded prior to the Closing and (b) 5,666,667 NioCorp
Assumed 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.
Both
the public NioCorp Assumed Warrants and the NioCorp Assumed Warrants issued to the Sponsor are subject to the terms of the NioCorp
Assumed Warrant Agreement and are identical, with certain exceptions applicable to the NioCorp Assumed
Warrants issued to the Sponsor for so long as such NioCorp Assumed Warrants are held by the Sponsor, its members, or their respective
affiliates and other permitted transferees. In accordance with the NioCorp Assumed Warrant Agreement, any NioCorp Assumed Warrants issued
to the Sponsor that are held by someone other than the Sponsor, its members, or their respective affiliates and other permitted transferees,
are treated as public NioCorp Assumed Warrants.
Each
NioCorp Assumed Warrant is exercisable on and after the 30th day following the Closing Date until its expiration for 1.11829212 Common
Shares at a price of $11.50 per 1.11829212 Common Shares (subject to adjustments for stock
splits, stock dividends, reorganizations, recapitalizations and the like). Under the terms of NioCorp Assumed Warrant Agreement, for so
long as the NioCorp Assumed Warrants issued to the Sponsor are held by the Sponsor, its members, or their respective affiliates and other
permitted transferees, such holders have the right to elect to exercise those NioCorp Assumed Warrants on a cashless basis. For such NioCorp
Assumed Warrants exercised on a cashless basis after the Closing, the holder will be entitled to pay the exercise price for those NioCorp
Assumed Warrants by surrendering all or portion of the cash and/or Common Shares (valued at their fair market value) into which those
NioCorp Assumed Warrants are exercisable as shall be elected by the holder. For this purpose, Common Shares so surrendered will be deemed
to have a “fair market value” equal to the average reported last sale price of the Common Shares for the 10 trading days ending
on the third trading day prior to the date of exercise of the applicable NioCorp Assumed Warrants.
The NioCorp
Assumed Warrants will expire five years after the Closing Date, at 5:00 p.m., New York City time, or earlier upon redemption or liquidation.
The Company
will not be obligated to deliver any Common Shares pursuant to the exercise of a NioCorp Assumed Warrant and will have no obligation to
settle such exercise unless a registration statement under the Securities Act with respect to the Common Shares underlying the NioCorp
Assumed Warrants is then effective and a prospectus relating thereto is current, subject to the Company satisfying its obligations described
below with respect to registration. No NioCorp Assumed Warrant will be exercisable and the Company will not be obligated to issue Common
Shares upon exercise of a NioCorp Assumed Warrant unless Common Shares issuable upon such exercise have been registered, qualified or
deemed to be exempt under the securities laws of the state of residence of the registered holder of the NioCorp Assumed Warrants. In the
event that the conditions in the two immediately preceding sentences are not satisfied with respect to a NioCorp Assumed Warrant, the
holder of such NioCorp Assumed Warrant will not be entitled to exercise such NioCorp Assumed Warrant and such NioCorp Assumed Warrant
may have no value and expire worthless. In no event will the Company be required to net cash settle any NioCorp Assumed Warrant.
The NioCorp
Assumed Warrants, and the underlying Common Shares issuable upon the exercise thereof, were registered under the Securities Act pursuant
to the Company’s registration statement on Form S-4, originally filed on November 7, 2022, as subsequently amended,
which was declared effective by the SEC on February 8, 2023. The Company is registering the ongoing offering of the Common Shares
underlying the NioCorp Assumed Warrants pursuant to a registration statement on Form S-3 separate from the registration statement of which
this prospectus is a part.
The Company
will have the right to call the public NioCorp Assumed Warrants for redemption at any time following the Closing Date:
| · | in whole and not in part; |
| · | at a price of $0.01 per NioCorp Assumed Warrant; |
| · | upon not less than 30 days’ prior written notice of redemption
(the “30-day redemption period”) to each public NioCorp Assumed Warrant holder; |
| · | if, and only if, the reported last sale price of the Common Shares
equals or exceeds approximately $16.10 per share (subject to certain adjustments) for any 20 trading days within a 30-trading day period
commencing once the NioCorp Assumed Warrants become exercisable and ending three business days before the Company sends the notice of
redemption to the public NioCorp Assumed Warrant holders; and |
| · | if there is an effective registration statement covering the Common
Shares issuable upon exercise of the NioCorp Assumed Warrants, and a current prospectus relating thereto, available throughout the 30-day
redemption period. |
The NioCorp
Assumed Warrants issued to the Sponsor are not redeemable by the Company for so long as such
NioCorp Assumed Warrants are held by the Sponsor, its members, or their respective affiliates or other permitted transferees. In addition,
the Company may not exercise its redemption right if the issuance of Common Shares upon exercise of the NioCorp Assumed Warrants is not
exempt from registration or qualification under applicable state blue sky laws or the Company is unable to effect such registration or
qualification.
If the
Company calls the public NioCorp Assumed Warrants for redemption as described above, the Company will have the option to require any holder
that wishes to exercise its public NioCorp Assumed Warrant to do so on a “cashless basis.” In determining whether to require
all holders to exercise their public NioCorp Assumed Warrants on a “cashless basis,” the Company will consider, among other
factors, its cash position, the number of NioCorp Assumed Warrants that are outstanding and the dilutive effect on the Company’s
shareholders of issuing the maximum number of Common Shares issuable upon the exercise of
the NioCorp Assumed Warrants. If the Company takes advantage of this option, all holders of public NioCorp Assumed Warrants would pay
the exercise price by surrendering their NioCorp Assumed Warrants for that number of Common Shares equal to the quotient obtained by dividing
(x) the product of the number of Common Shares underlying the public NioCorp Assumed Warrants, multiplied by the difference between the
exercise price of the NioCorp Assumed Warrants and the “fair market value” (defined below) by (y) the fair market value. The
“fair market value” shall mean the average reported last sale price of the Common Shares for the 10 trading days ending on
the third trading day prior to the date on which the notice of redemption is sent to the holders of public NioCorp Assumed Warrants. If
the Company takes advantage of this option, the notice of redemption will contain the information necessary to calculate the number of
Common Shares to be received upon exercise of the NioCorp Assumed Warrants, including the “fair market value” in such case.
Requiring a cashless exercise in this manner will reduce the number of Common Shares to be issued and thereby lessen the dilutive effect
of a redemption of the public NioCorp Assumed Warrants. If the Company calls the public NioCorp Assumed Warrants for redemption and does
not take advantage of this option, the Sponsor, its members, and their respective affiliates and other permitted transferees would still
be entitled to exercise their NioCorp Assumed Warrants for cash or on a cashless basis using the same formula described above that other
NioCorp Assumed Warrant holders would have been required to use had all NioCorp Assumed Warrant holders been required to exercise their
NioCorp Assumed Warrants on a cashless basis, as described in more detail below.
A holder
of a NioCorp Assumed Warrant may notify the Company in writing in the event it elects to be subject to a requirement that such holder
will not have the right to exercise such NioCorp Assumed Warrant, to the extent
that after giving effect to such exercise, such holder (together
with such holder’s affiliates), to the NioCorp Assumed Warrant Agent’s actual knowledge,
would beneficially own in excess of 4.9% or 9.8% (or such other amount as a holder may specify) of the Common Shares outstanding immediately
after giving effect to such exercise.
The NioCorp
Assumed Warrants have certain anti-dilution and adjustments rights upon certain events.
The NioCorp
Assumed Warrants may be exercised upon surrender of the certificate representing such NioCorp Assumed Warrants on or prior to
the expiration date at the offices of the NioCorp Assumed Warrant Agent, with the exercise form on the reverse side of such certificate
completed and executed as indicated, accompanied by full payment of the exercise price (or on a cashless basis, if applicable), by certified
or official bank check payable to the order of the NioCorp Assumed Warrant Agent or by wire transfer, for the number of NioCorp Assumed
Warrants being exercised. The NioCorp Assumed Warrant holders will not have the rights or privileges of holders of Common Shares or any
attendant voting rights until they exercise their NioCorp Assumed Warrants and receive Common Shares. After the issuance of Common Shares
upon exercise of the NioCorp Assumed Warrants, each holder will be entitled to one (1) vote for each Common Share held of record on all
matters to be voted on by NioCorp shareholders.
If, upon
exercise of the NioCorp Assumed Warrants, a holder would be entitled to receive a fractional interest in a share, the Company will, upon
exercise, round down to the nearest whole number of Common Shares to be issued to the NioCorp Assumed Warrant holder.
The NioCorp
Assumed Warrants were issued in registered form under the NioCorp Assumed Warrant Agreement. The NioCorp Assumed Warrant Agreement may
be amended by the parties thereto without the consent of any registered holder (i) for the purpose of curing any ambiguity, or curing,
correcting or supplementing any mistake, or adding or changing any other provisions with
respect to matters or questions arising under NioCorp Assumed Warrant Agreement as the parties may deem necessary or desirable and that
the parties deem shall not adversely affect the interest of the registered holders of the NioCorp Assumed Warrants, and (ii) to provide
for the delivery of such kind and amount of Common Shares or other securities or property (including cash) receivable upon a reclassification,
reorganization, merger or consolidation, or upon a dissolution following any such sale or transfer, that the holder of NioCorp Assumed
Warrants would have received if such holder had exercised his, her or its NioCorp Assumed Warrants immediately prior to such event. All
other modifications or amendments, including any amendment to increase the warrant price or shorten the exercise period, shall require
the vote or written consent of the registered holders of a majority of the then outstanding public NioCorp Assumed Warrants. Any amendment
solely to the NioCorp Assumed Warrants issued to the Sponsor and that are held by the Sponsor, its members, or their respective affiliates
or other permitted transferees, shall require the vote or written consent of a majority of the holders of the then outstanding NioCorp
Assumed Warrants issued to the Sponsor.
Convertible Debentures
On January 26, 2023, NioCorp entered into the
Yorkville Convertible Debt Financing Agreement with YA. Pursuant to the Yorkville Convertible Debt Financing Agreement, YA advanced a
total amount of $15,360,000 to NioCorp in consideration of the issuance by NioCorp to YA of $16,000,000 aggregate principal amount of
Convertible Debentures at the time of Closing (the “Debenture Closing”).
Each Convertible Debenture issued under the
Yorkville Convertible Debt Financing Agreement is an unsecured obligation of NioCorp, has an 18-month term from the Debenture Closing,
which may be extended for one six-month period in certain circumstances at the option of NioCorp, and incurs a simple interest rate obligation
of 5.0% per annum (which will increase to 15.0% per annum upon the occurrence of an event of default). The outstanding principal amount
of, accrued and unpaid interest, if any, on, and premium, if any, on the Convertible Debentures must be paid by NioCorp in cash when the
same becomes due and payable under the terms of the Convertible Debentures at their stated maturity, upon their redemption or otherwise.
Subject to certain limitations contained within
the Yorkville Convertible Debt Financing Agreement and the Convertible Debentures, including those as described below, holders of the
Convertible Debentures will be entitled to convert the principal amount of, and accrued and unpaid interest, if any, on each Convertible
Debenture, in whole or in part, from time to time over their term, into a number of Common Shares equal to the quotient of the principal
amount and accrued and unpaid interest, if any, being converted divided by the Conversion Price. The “Conversion
Price” means, as of any Conversion Date (as defined below)
or other date of determination, the greater of (i) 90% of the average of the daily U.S. dollar volume-weighted average price of the Common
Shares on the principal U.S. market for the Common Shares as reported by Bloomberg Financial Markets during the five consecutive trading
days immediately preceding the date on which the holder exercises its conversion right in accordance with the requirements of the Yorkville
Convertible Debt Financing Agreement (the “Conversion Date”) or other date of determination, but not lower than the Floor
Price (as defined below), and (ii) the five-day volume-weighted average price of the Common Shares on the TSX (or on the principal U.S.
market if the majority of the trading volume and value of the Common Shares occurred on Nasdaq during the relevant period) for the five
consecutive trading days immediately prior to the Conversion Date or other date of determination less the maximum applicable discount
allowed by the TSX. The “Floor Price” means a price of $2.1435 per share, which is equal to the lesser of (a) 30% of the average
of the daily volume-weighted average price of the Common Shares on the principal U.S. market for the Common Shares as reported by Bloomberg
Financial Markets during the five consecutive trading days immediately preceding the Debenture Closing and (b) 30% of the average of the
volume-weighted average price of the Common Shares on the principal U.S. market for the Common Shares as reported by Bloomberg Financial
Markets during the five consecutive trading days immediately following the Debenture Closing, subject to certain adjustments to give effect
to any stock dividend, stock split, reverse stock split, recapitalization or similar event.
The terms of the Convertible Debentures restrict
the number of Convertible Debentures that may be converted during each calendar month by YA at a Conversion Price below a fixed price
equal to the quotient of (i) $10.00 divided by (ii) 1.11829212 (being the number of Common Shares that were exchanged for each share of
GXII at the Closing, after giving effect to the Reverse Stock Split), subject to adjustment to give effect to any stock dividend, stock
split, reverse stock split, recapitalization or similar event. The Convertible Debentures are subject to customary anti-dilution adjustments.
The terms of the Convertible Debentures restrict the
conversion of Convertible Debentures by YA if such a conversion would cause YA to exceed certain beneficial ownership thresholds in NioCorp
or such a conversion would cause the aggregate number of Common Shares issued pursuant to the Yorkville Convertible Debt Financing Agreement
to exceed the thresholds for issuance of Common Shares under the rules of the TSX and Nasdaq, unless prior shareholder approval is obtained.
Financing Warrants
In conjunction
with the Debenture Closing, NioCorp issued to YA Financing Warrants to purchase 1,789,267 Common Shares, which is equal to the quotient
of the principal amount of Convertible Debentures issued in such Debenture Closing divided by the “Exercise Price,” which
is equal to approximately $8.9422 (i.e., the quotient of $10.00 divided by 1.11829212 (being the number of Common Shares that were
exchanged for each share of GXII at the Closing, after giving effect to the Reverse Stock Split)), in each case, subject to adjustment
to give effect to any stock dividend, stock split, reverse stock split, recapitalization or similar
event.
The
Financing Warrants are exercisable, in whole or in part, but not in increments of less than $50,000 aggregate Exercise Price (unless
the remaining aggregate Exercise Price is less than $50,000), beginning on the earlier of
(a) six months following the issuance of the applicable Financing Warrants or (b) the effective date of the initial registration statement
registering under the Securities Act the resale of the Common Shares issuable upon conversion of the Convertible Debentures and upon
exercise of the Financing Warrants (the “Convertible Debt Financing Registration Statement”) and may be exercised at any
time prior to their expiration. Holders of the Financing Warrants may exercise their Financing Warrants, at their election, by paying
the Exercise Price in 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 exercise basis. On each
of the first 12 monthly anniversaries of the later of (a) the date that is six months following the issuance of the applicable Financing
Warrants and (b) the effective date of the initial Convertible Debt Financing Registration Statement, 1/12th of the Financing Warrants
will expire.
The Financing
Warrants have customary anti-dilution adjustments to be determined in accordance with the requirements of the applicable
stock exchanges, including the TSX.
The terms
of the Financing Warrants restrict the exercise of Financing Warrants by YA if such an exercise would cause YA to exceed certain
beneficial ownership thresholds in NioCorp or such an exercise would cause the aggregate number of Common Shares issued pursuant to the
Yorkville Convertible Debt Financing Agreement to exceed the thresholds for issuance of Common Shares under the rules
of the TSX and Nasdaq, unless prior shareholder approval is obtained.
CERTAIN UNITED
STATES FEDERAL INCOME TAX CONSIDERATIONS
The following is a general summary of certain
U.S. federal income tax considerations applicable to a U.S. Holder (as defined below) arising from and relating to the acquisition, ownership,
and disposition of the Common Shares. This summary is for general information purposes only and does not purport to be a complete analysis
or listing of all potential U.S. federal income tax considerations that may apply to a U.S. Holder arising from and relating to the acquisition,
ownership, and disposition of Common Shares. In addition, this summary does not take into account the individual facts and circumstances
of any particular U.S. Holder that may affect the U.S. federal income tax consequences to such U.S. Holder, including, without limitation,
specific tax consequences to a U.S. Holder under an applicable income tax treaty. Accordingly, this summary is not intended to be, and
should not be construed as, legal or U.S. federal income tax advice with respect to any U.S. Holder. This summary does not address any
tax consequences to U.S. Holders of the acquisition, ownership, and disposition of Common Shares arising from the U.S. federal alternative
minimum tax or the Medicare tax on investment income, U.S. federal estate, gift and other non-income taxes, U.S. state and local taxes,
or any non-U.S. tax. In addition, except as specifically set forth below, this summary does not discuss applicable tax reporting requirements.
Each prospective U.S. Holder should consult its own tax advisors regarding the U.S. federal, U.S. federal alternative minimum, U.S. federal
estate and gift, U.S. state and local, and non-U.S. tax consequences relating to the acquisition, ownership and disposition of the Common
Shares.
No legal opinion from U.S. legal counsel or
ruling from the IRS has been requested, or will be obtained, regarding the U.S. federal income tax consequences of the acquisition, ownership,
and disposition of the Common Shares. This summary is not binding on the IRS, and the IRS is not precluded from taking a position that
is different from, and contrary to, the positions taken in this summary. In addition, because the authorities on which this summary is
based are subject to various interpretations, the IRS and the U.S. courts could disagree with one or more of the conclusions described
in this summary.
Scope of this Summary
Authorities
This summary is based on the Code, Treasury
Regulations (whether final, temporary, or proposed), published rulings and administrative positions of the IRS, the Convention Between
Canada and the United States of America with Respect to Taxes on Income and on Capital, signed September 26, 1980, as amended (the “Canada-U.S.
Tax Convention”), and U.S. court decisions that are applicable, and, in each case, as in effect and available, as of the date of
this document. Any of the authorities on which this summary is based could be changed in a material and adverse manner at any time, and
any such change could be applied retroactively. This summary does not discuss the potential effects, whether adverse or beneficial, of
any proposed legislation.
U.S. Holders
For purposes of this summary, the term “U.S.
Holder” means a beneficial owner of Common Shares that is for U.S. federal income tax purposes:
| • | an individual who is a citizen or resident of
the United States; |
| • | a corporation (or other entity treated as a corporation
for U.S. federal income tax purposes) organized under the laws of the United States, any state thereof or the District of Columbia; |
| • | an estate whose income is subject to U.S. federal
income taxation regardless of its source; or |
| • | a trust that (1) is subject to the primary supervision
of a court within the U.S. and the control of one or more U.S. persons for all substantial decisions or (2) has a valid election in effect
under applicable Treasury Regulations to be treated as a U.S. person. |
U.S. Holders Subject to Special U.S.
Federal Income Tax Rules Not Addressed
This summary does not address the U.S. federal
income tax considerations applicable to U.S. Holders that are subject to special provisions under the Code, including, but not limited
to, U.S. Holders that: (a) are tax-exempt organizations, qualified retirement plans, individual retirement accounts, or other tax-deferred
accounts; (b) are financial institutions, underwriters, insurance companies, real estate investment trusts, or regulated investment companies;
(c) are broker-dealers, dealers, or traders in securities or currencies that elect to apply a mark-to-market accounting method; (d) have
a “functional currency” other than the U.S. dollar; (e) own Common Shares as part of a straddle, hedging transaction, conversion
transaction, constructive sale, or other arrangement involving more than one position; (f) acquire Common Shares in connection with the
exercise of employee stock options or otherwise as compensation for services; (g) hold Common Shares other than as a capital asset within
the meaning of Section 1221 of the Code (generally, property held for investment purposes); or (h) own, have owned or will own (directly,
indirectly, or by attribution) 10% or more of the total combined voting power of the outstanding shares of the Company. This summary also
does not address the U.S. federal income tax considerations applicable to U.S. Holders who are: (a) U.S. expatriates or former long-term
residents of the U.S.; (b) persons that have been, are, or will be a resident or deemed to be a resident in Canada for purposes of the
Income Tax Act (Canada) (the “Tax Act”); (c) persons that use or hold, will use or hold, or that are or will be deemed to
use or hold Common Shares in connection with carrying on a business in Canada; (d) persons whose Common Shares constitute “taxable
Canadian property” under the Tax Act; or (e) persons that have a permanent establishment in Canada for the purposes of the Canada-U.S.
Tax Convention. U.S. Holders that are subject to special provisions under the Code, including, but not limited to, U.S. Holders described
immediately above, should consult their own tax advisors regarding tax consequences relating to the acquisition, ownership and disposition
of Common Shares.
If an entity or arrangement that is classified
as a partnership (or other “pass-through” entity) for U.S. federal income tax purposes holds Common Shares, the U.S. federal
income tax consequences to such entity or arrangement and the partners (or other owners or participants) of such entity or arrangement
generally will depend on the activities of the entity or arrangement and the status of such partners (or owners or participants). This
summary does not address the tax consequences to any such partner (or owner or participants). Partners (or other owners or participants)
of entities or arrangements that are classified as partnerships or as “pass-through” entities for U.S. federal income tax
purposes should consult their own tax advisors regarding the U.S. federal income tax consequences arising from and relating to the acquisition,
ownership, and disposition of Common Shares.
General Rules Applicable to the Ownership
and Disposition of Common Shares
Distributions on Common Shares
A U.S. Holder that receives a distribution,
including a constructive distribution, with respect to a Common Share will be required to include the amount of such distribution in gross
income as a dividend (without reduction for any Canadian income tax withheld from such distribution) to the extent of the current and
accumulated “earnings and profits” of the Company, as computed for U.S. federal income tax purposes. To the extent that a
distribution exceeds the current and accumulated “earnings and profits” of the Company, such distribution will be treated,
first, as a tax-free return of capital to the extent of a U.S. Holder’s tax basis in the Common Shares and thereafter as gain from
the sale or exchange of such Common Shares. However, the Company may not maintain the calculations of its earnings and profits in accordance
with U.S. federal income tax principles, and U.S. Holders may have to assume that any distribution by the Company with respect to the
Common Shares will constitute ordinary dividend income. Dividends received on Common Shares by a corporate U.S. Holder (other than certain
10% corporate shareholders) generally will not be eligible for a “dividends received deduction.” Provided that (1) the Company
is eligible for the benefits of the Canada-U.S. Tax Convention or (2) the Common Shares are readily tradable on a United States securities
market (and certain holding period and other conditions are satisfied), dividends paid by the Company to non-corporate U.S. Holders ,
including individuals, will be eligible for the preferential tax rates applicable to long-term capital gains for dividends unless the
Company is classified as a PFIC in the tax year of distribution or in the preceding tax year. See “—Passive Foreign Investment
Company Rules—Risk of PFIC Status for the Company” below. The dividend rules are complex, and each U.S. Holder should consult
its own tax advisors regarding the application of such rules.
Sales or Other Taxable Dispositions of
Common Shares
Upon the sale or other taxable disposition
of Common Shares, subject to the potential application of the PFIC rules as described below, a U.S. Holder generally will recognize capital
gain or loss in an amount equal to the difference between (i) the U.S. dollar value of cash received plus the fair market value of any
property received and (ii) such U.S. Holder’s adjusted tax basis in such Common Shares sold or otherwise disposed of. A U.S.
Holder’s tax basis in Common Shares generally will be determined initially by the holder’s U.S. dollar cost for the Common
Shares (subject to any adjustments provided under the PFIC rules, described below). Subject again to the PFIC rules, gain or loss recognized
on such sale or other disposition generally will be long-term capital gain or loss if, at the time of the sale or other disposition, the
Common Shares have been held for more than one year. Any gain or loss will generally be U.S. source for U.S. foreign tax credit purposes.
Preferential tax rates currently apply to long-term
capital gain of a U.S. Holder that is an individual, estate, or trust. There are currently no preferential tax rates for long-term capital
gain of a U.S. Holder that is a corporation. Deductions for capital losses are subject to significant limitations under the Code. If the
Company is determined to be a PFIC, any gain realized on the Common Shares could be ordinary income under the rules discussed below.
Passive Foreign Investment Company Rules
Risk of PFIC Status for the Company
If the Company were to constitute a PFIC under
the meaning of Section 1297 of the Code for any taxable year during a U.S. Holder’s holding period, then certain potentially adverse
U.S. federal income tax rules may apply to a U.S. Holder of Common Shares. While this summary cannot describe all of the potentially adverse
consequences that would result if the Company were treated as a PFIC for a relevant taxable year, certain material consequences and related
considerations are described below.
The Company believes that it was classified
as a PFIC during the tax years ended June 30, 2022 and 2021, and, based on the current composition of its income and assets, as well as
current business plans and financial expectations, may meet the PFIC qualification tests for its current tax year or in future tax years.
No opinion of legal counsel or ruling from the IRS concerning the PFIC status of the Company 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 tax 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 tax year depends on the assets and income of such corporation over the course of each such tax year
and, as a result, cannot be predicted with certainty as of the date of this document. In addition, even if the Company concluded that
it or any Subsidiary did not qualify as a PFIC, the IRS could challenge any determination made by the Company (or any subsidiary of the
Company) concerning its PFIC status in any taxable year, and a court could sustain such challenge. Accordingly, there can be no assurance
that the Company or any Subsidiary will not be treated as a PFIC for any taxable year. Each U.S. Holder should consult its own tax advisors
regarding the PFIC status of the Company and each subsidiary of the Company.
In any taxable year in which the Company is
classified as a PFIC, a U.S. Holder will be required to file an annual report with the IRS containing such information as Treasury Regulations
and/or other IRS guidance may require. IRS Form 8621 is currently used for such filings. In addition to penalties, a failure to satisfy
such reporting requirements may result in an extension of the time period during which the IRS can assess a tax. U.S. Holders should consult
their own tax advisors regarding the requirements of filing such information returns under these rules, including the requirement to file
an IRS Form 8621 annually.
The Company generally would be a PFIC for a
taxable year if, for such year, (a) 75% or more of the gross income of the Company is passive income (the “PFIC income test”)
or (b) 50% or more of the value of the Company’s assets either produce passive income or are held for the production of passive
income, based on the quarterly average of the fair market value of such assets (the “PFIC asset test”). “Gross income”
generally includes all sales revenues less the cost of goods sold, plus income from investments and from incidental or outside operations
or sources, and “passive income” generally includes, for example, dividends, interest, certain rents and royalties, certain
gains from the sale of stock and securities, and certain gains from commodities transactions.
Active business gains arising from the sale
of commodities generally are excluded from passive income if substantially all of a foreign corporation’s business is as an active
producer, processor, merchant or handler of commodities, and certain other requirements are satisfied.
For purposes of the PFIC income test and PFIC
asset test described above, if the Company owns, directly or indirectly, 25% or more of the total value of the outstanding shares of another
corporation, the Company will be treated as if it (a) held a proportionate share of the assets of such other corporation and (b) received
directly a proportionate share of the income of such other corporation. In addition, for purposes of the PFIC income test and PFIC asset
test described above, and assuming certain other requirements are met, “passive income” does not include certain interest,
dividends, rents, or royalties that are received or accrued by the Company from certain “related persons” (as defined in Section
954(d)(3) of the Code) also organized in Canada, to the extent such items are properly allocable to the income of such related person
that is neither passive income nor income connected with a U.S. trade or business.
Under certain attribution rules, if the Company
is a PFIC, U.S. Holders will generally be deemed to own their proportionate share of the Company’s direct or indirect equity interest
in any company that is also a PFIC (a “Subsidiary PFIC”), and will generally be subject to U.S. federal income tax on their
proportionate share of (a) any “excess distributions,” as described below, on the stock of a Subsidiary PFIC and (b) a disposition
or deemed disposition of the stock of a Subsidiary PFIC by the Company or another Subsidiary PFIC, both as if such U.S. Holders directly
held the shares of such Subsidiary PFIC. In addition, U.S. Holders may be subject to U.S. federal income tax on any indirect gain realized
on the stock of a Subsidiary PFIC on the sale or disposition of Common Shares. Accordingly, U.S. Holders should be aware that they could
be subject to tax under the PFIC rules even if no distributions are received on the Common Shares and no redemptions or other dispositions
of Common Shares are made.
Default PFIC Rules
If the Company is a PFIC for any tax year during
which a U.S. Holder owns Common Shares, the U.S. federal income tax consequences to such U.S. Holder of the acquisition, ownership, and
disposition of Common Shares will depend on whether and when such U.S. Holder makes an election to treat the Company and each Subsidiary
PFIC, if any, as a “qualified electing fund” (“QEF”) under Section 1295 of the Code (a “QEF Election”)
or makes a mark-to-market election under Section 1296 of the Code (a “Mark-to-Market Election”). A U.S. Holder that does not
make either a QEF Election or a Mark-to-Market Election will be referred to in this summary as a “Non-Electing U.S. Holder.”
A Non-Electing U.S. Holder will be subject
to the rules of Section 1291 of the Code (described below) with respect to (a) any gain recognized on the sale or other taxable disposition
of Common Shares and (b) any “excess distribution” received on the Common Shares. A distribution generally will be an “excess
distribution” to the extent that such distribution (together with all other distributions received in the current tax year) exceeds
125% of the average distributions received during the three preceding tax years (or during a U.S. Holder’s holding period for the
Common Shares, if shorter).
If the Company is a PFIC, under Section 1291
of the Code, any gain recognized on the sale or other taxable disposition of Common Shares (including an indirect disposition of the stock
of any Subsidiary PFIC), and any “excess distribution” received on Common Shares or deemed received with respect to the stock
of a Subsidiary PFIC, must be ratably allocated to each day in a Non-Electing U.S. Holder’s holding period for the respective Common
Shares. The amount of any such gain or excess distribution allocated to the tax year of disposition or distribution of the excess distribution,
or allocated to years before the entity became a PFIC, if any, would be taxed as ordinary income at the rates applicable for such year
(and not eligible for certain preferred rates). The amounts allocated to any other tax year would be subject to U.S. federal income tax
at the highest tax rate applicable to ordinary income in each such year. In addition, an interest charge would be imposed on the tax liability
for each such year, calculated as if such tax liability had been due in each such year. A Non-Electing U.S. Holder that is not a corporation
must treat any such interest paid as “personal interest,” which is not deductible.
If the Company is a PFIC for any tax year during
which a Non-Electing U.S. Holder holds Common Shares, the Company will continue to be treated as a PFIC with respect to such Non-Electing
U.S. Holder, regardless of whether the Company ceases to be a PFIC in one or more subsequent tax years. A Non-Electing U.S. Holder may
terminate
this deemed PFIC status by making a “purging” election
to recognize gain (which will be taxed under the rules of Section 1291 of the Code discussed above), but not loss, as if such Common Shares
were sold on the last day of the last tax year for which the Company was a PFIC.
In addition to the rules described above applying
to “excess distributions” and certain other dispositions of Common Shares, certain other adverse U.S. federal income tax rules
may apply with respect to a U.S. Holder if the Company is a PFIC, including in some cases even if the U.S. Holder makes a QEF Election
(as described below). Each U.S. Holder should consult its own tax advisors regarding the full tax consequences of potential PFIC status
for the Company and each subsidiary of the Company.
QEF Election
If the Company is a PFIC, a U.S. Holder that
makes a timely and effective QEF Election for the tax year in which the holding period of its Common Shares begins generally will not
be subject to the rules of Section 1291 of the Code discussed above with respect to such Common Shares. A U.S. Holder that makes such
a QEF Election will be subject to U.S. federal income tax on such U.S. Holder’s pro rata share (based on its ownership of Common
Shares) of (a) the net capital gain of the Company, which will be taxed as long-term capital gain to such U.S. Holder, and (b) the ordinary
earnings of the Company, which will be taxed as ordinary income to such U.S. Holder. Generally, “net capital gain” is the
excess of (a) net long-term capital gain over (b) net short-term capital loss, and “ordinary earnings” are the excess of (a)
“earnings and profits” over (b) net capital gain. A U.S. Holder that makes a QEF Election will be subject to U.S. federal
income tax on such amounts for each tax year in which the Company is a PFIC, regardless of whether such amounts are actually distributed
to such U.S. Holder by the Company. However, for any tax year in which the Company is a PFIC and has no net income or gain, U.S. Holders
that have made a QEF Election would not have any income inclusions as a result of the QEF Election. If a U.S. Holder that made a QEF Election
has an income inclusion, such a U.S. Holder may, subject to certain limitations, elect to defer payment of current U.S. federal income
tax on such amounts, subject to an interest charge. If such U.S. Holder is not a corporation, any such interest paid will be treated as
“personal interest,” which is not deductible.
A U.S. Holder that makes a timely and effective
QEF Election with respect to the Company generally (a) may receive a tax-free distribution from the Company to the extent that such distribution
represents “earnings and profits” of the Company that were previously included in income by the U.S. Holder because of such
QEF Election and (b) will adjust such U.S. Holder’s tax basis in the Common Shares to reflect the amount included in income or allowed
as a tax-free distribution because of such QEF Election. A U.S. Holder that makes a QEF Election generally will recognize capital gain
or loss on the sale or other taxable disposition of Common Shares.
A U.S. Holder may make a timely QEF Election
by filing the appropriate QEF Election documents (currently IRS Form 8621) at the time such U.S. Holder files a U.S. federal income tax
return for such year. If a U.S. Holder does not make a timely QEF Election for the first year in the U.S. Holder’s holding period
in which the Company is a PFIC, the U.S. Holder may still be able to make an effective QEF Election in a subsequent year if such U.S.
Holder meets certain requirements and makes a “purging” election to recognize gain (which will be taxed under the rules of
Section 1291 of the Code discussed above) as if such Common Shares were sold for their fair market value on the day the QEF Election is
effective. If a U.S. Holder makes a QEF Election but does not make a “purging” election to recognize gain as discussed in
the preceding sentence, then such U.S. Holder shall be subject to the QEF Election rules and shall continue to be subject to tax under
the rules of Section 1291 discussed above with respect to its Common Shares. If a U.S. Holder owns PFIC stock indirectly through another
PFIC, separate QEF Elections must be made for the PFIC in which the U.S. Holder is a direct shareholder and the Subsidiary PFIC for the
QEF rules to apply to both PFICs.
A QEF Election will apply to the tax year for
which such QEF Election is timely made and to all subsequent tax years, unless such QEF Election is invalidated or terminated or the IRS
consents to revocation of such QEF Election. If a U.S. Holder makes a QEF Election and, in a subsequent tax year, the Company ceases to
be a PFIC, the QEF Election will remain in effect (although it will not be applicable) during those tax years in which the Company is
not a PFIC. Accordingly, if the Company becomes a PFIC in another subsequent tax year, the QEF Election will be effective, and the U.S.
Holder will be subject to the QEF rules described above during any subsequent tax year in which the Company qualifies as a PFIC.
The Company will endeavor to provide U.S. Holders
with the required information to allow U.S. Holders to make a QEF Election with respect to the Common Shares in the event that the Company
determines it is treated as a PFIC for any taxable year. There can be no assurance, however, that the Company will timely provide such
information for any particular year, or that the Company’s determination regarding its PFIC status will be upheld. U.S. Holders
should consult their tax advisors to determine whether any of these QEF Elections will be available and if so, what the consequences of
these elections would be in their particular circumstances.
A U.S. Holder makes a QEF Election by attaching
a completed IRS Form 8621, including a PFIC Annual Information Statement, to a timely filed United States federal income tax return. However,
if the Company does not timely provide the required information with regard to the Company or any of its Subsidiary PFICs, U.S. Holders
may not be able to make a QEF Election for such entity and, unless they make the Mark-to-Market Election discussed in the next section,
will continue to be subject to the rules of Section 1291 of the Code discussed above that apply to Non-Electing U.S. Holders with respect
to the taxation of gains and excess distributions.
Mark-to-Market Election
A U.S. Holder may make a Mark-to-Market Election
only if the Common Shares are marketable stock. The Common Shares generally will be “marketable stock” if the Common Shares
are regularly traded on (a) a national securities exchange that is registered with the SEC, (b) the national market system established
pursuant to section 11A of the Exchange Act, or (c) a foreign securities exchange that is regulated or supervised by a governmental authority
of the country in which the market is located, provided that the foreign exchange meets certain trading volume and other requirements.
If such stock is traded on such a qualified exchange or other market, such stock generally will be “regularly traded” for
any calendar year during which such stock is traded, other than in de minimis quantities, on at least 15 days during each calendar quarter.
The Company expects that the Common Shares will meet the definition of “marketable stock,” although there can be no assurance
of this, especially as regards the required trading frequency.
If a U.S. Holder that makes a Mark-to-Market
Election for any taxable year with respect to its Common Shares, it generally will not be subject to the rules of Section 1291 of the
Code discussed above with respect to such Common Shares for such taxable year. However, if a U.S. Holder does not make a Mark-to-Market
Election beginning in the first tax year of such U.S. Holder’s holding period for which the Company is a PFIC and such U.S. Holder
has not made a timely QEF Election, the rules of Section 1291 of the Code discussed above will apply to dispositions of, and certain distributions
on, the Common Shares.
A U.S. Holder that makes a Mark-to-Market Election
will include in ordinary income, for each tax year in which the Company is a PFIC, an amount equal to the excess, if any, of (a) the fair
market value of the Common Shares, as of the close of such tax year over (b) such U.S. Holder’s adjusted tax basis in such Common
Shares. A U.S. Holder that makes a Mark-to-Market Election will be allowed a deduction in an amount equal to the excess, if any, of (a)
such U.S. Holder’s adjusted tax basis in the Common Shares, over (b) the fair market value of such Common Shares (but only to the
extent of the net amount of previously included income as a result of the Mark-to-Market Election for prior tax years).
A U.S. Holder that makes a Mark-to-Market Election
will also generally adjust its tax basis in the Common Shares to reflect the amount included in gross income or allowed as a deduction
because of such Mark-to-Market Election. Upon a sale or other taxable disposition of Common Shares, a U.S. Holder that makes a Mark-to-Market
Election will recognize ordinary income or ordinary loss (and such ordinary loss may be treated as capital or subject to limitations in
certain cases).
A U.S. Holder makes a Mark-to-Market Election
by attaching a completed IRS Form 8621 to a timely filed United States federal income tax return. A Mark-to-Market Election applies to
the tax year in which such Mark-to-Market Election is made and to each subsequent tax year, unless the Common Shares cease to be “marketable
stock” or the IRS consents to revocation of such election. Each U.S. Holder should consult its own tax advisors regarding the requirements
for, and procedure for making, a Mark-to-Market Election.
Although a U.S. Holder may be eligible to make
a Mark-to-Market Election with respect to the Common Shares, no such election may be made with respect to the stock of any Subsidiary
PFIC that a U.S. Holder is treated as owning, because such stock is not marketable. Hence, the Mark-to-Market Election will not be effective
to avoid
the application of the default rules of Section 1291 of the Code
described above with respect to deemed dispositions of Subsidiary PFIC stock or excess distributions from a Subsidiary PFIC to its shareholder.
AS THE PFIC RULES ARE COMPLEX AND UNCERTAIN, U.S. HOLDERS SHOULD
CONSULT WITH THEIR TAX ADVISORS TO DETERMINE THE POTENTIAL APPLICATION OF THE PFIC RULES TO THEM AND THEIR COMMON SHARES AND ANY RESULTANT
TAX CONSEQUENCES.
Additional Considerations
Receipt of Foreign Currency
The amount of any distribution paid to a U.S.
Holder in foreign currency, or on the sale, exchange or other taxable disposition of Common Shares, generally will be equal to the U.S.
dollar value of such foreign currency based on the exchange rate applicable on the date of receipt (regardless of whether such foreign
currency is converted into U.S. dollars at that time). A U.S. Holder will have a basis in the foreign currency equal to its U.S. dollar
value on the date of receipt. Any U.S. Holder who converts or otherwise disposes of the foreign currency after the date of receipt may
have a foreign currency exchange gain or loss that would be treated as ordinary income or loss, and generally will be U.S. source income
or loss for foreign tax credit purposes. Different rules apply to U.S. Holders who use the accrual method of tax accounting. Each U.S.
Holder should consult its own U.S. tax advisors regarding the U.S. federal income tax consequences of receiving, owning, and disposing
of foreign currency.
Foreign Tax Credit
Subject to the potential application of the
PFIC rules discussed above, a U.S. Holder that pays (whether directly or through withholding) Canadian income tax with respect to dividends
paid on the Common Shares generally will be entitled, at the election of such U.S. Holder, to receive either a deduction or a credit for
such Canadian income tax. Generally, a credit will reduce a U.S. Holder’s U.S. federal income tax liability on a dollar-for-dollar
basis, whereas a deduction will reduce a U.S. Holder’s income that is subject to U.S. federal income tax. This election is made
on a year-by-year basis and applies to all foreign taxes paid (whether directly or through withholding) by a U.S. Holder during a year.
Complex limitations apply to the foreign tax
credit, including the general limitation that the credit cannot exceed the proportionate share of a U.S. Holder’s U.S. federal income
tax liability that such U.S. Holder’s “foreign source” taxable income bears to such U.S. Holder’s worldwide taxable
income. In applying this limitation, a U.S. Holder’s various items of income and deduction must be classified, under complex rules,
as either “foreign source” or “U.S. source.” Generally, dividends paid on the Common Shares should be treated
as foreign source for this purpose, and gains recognized on the sale of Common Shares by a U.S. Holder should be treated as U.S. source
for this purpose, except as otherwise provided in an applicable income tax treaty, and if an election is properly made under the Code.
However, the amount of a distribution with respect to the Common Shares that is treated as a “dividend” may be lower for U.S.
federal income tax purposes than it is for Canadian federal income tax purposes, resulting in a reduced foreign tax credit allowance to
a U.S. Holder. In addition, this limitation is calculated separately with respect to specific categories of income. The foreign tax credit
rules are complex, and each U.S. Holder should consult its own U.S. tax advisors regarding the foreign tax credit rules.
Information Reporting and Backup Withholding
Certain U.S. Holders may be subject to certain
reporting obligations with respect to Common Shares if the aggregate value of these and certain other “specified foreign financial
assets” exceeds an applicable dollar threshold. If required, this disclosure is made by filing Form 8938 with the IRS. Significant
penalties can apply if a U.S. Holder is required to make this disclosure and fails to do so. In addition, a U.S. Holder should consider
the possible obligation to file online a FinCEN Form 114—Foreign Bank and Financial Accounts Report, as a result of holding Common
Shares in certain accounts. Holders are urged to consult their U.S. tax advisors with respect to these and other reporting requirements
that may apply to their acquisition of Common Shares.
Dividend payments (including constructive dividends)
with respect to Common Shares and proceeds from the sale, exchange or redemption of Common Shares may be subject to information reporting
to the IRS and possible United States backup withholding. Backup withholding (currently at a rate of 24%) will not apply, however, to
a
U.S. Holder who furnishes a correct taxpayer identification number
(generally on an IRS Form W-9 provided to the paying agent of the U.S. Holder’s broker) and makes other required certifications,
or who is otherwise exempt from backup withholding and establishes such exempt status. Backup withholding is not an additional tax. Any
amounts withheld under the U.S. backup withholding tax rules may be allowed as a credit against a U.S. Holder’s U.S. federal income
tax liability, if any, provided the required information is timely furnished to the IRS.
THE ABOVE SUMMARY IS NOT INTENDED TO CONSTITUTE A COMPLETE ANALYSIS
OF ALL TAX CONSIDERATIONS APPLICABLE TO U.S. HOLDERS WITH RESPECT TO THE ACQUISITION, OWNERSHIP, AND DISPOSITION OF COMMON SHARES. U.S.
HOLDERS SHOULD CONSULT THEIR OWN TAX ADVISORS AS TO THE TAX CONSIDERATIONS APPLICABLE TO THEM IN THEIR OWN PARTICULAR CIRCUMSTANCES.
Certain Canadian
federal Income Tax Considerations for U.S. Residents
The following generally summarizes certain
Canadian federal income tax consequences generally applicable under the Income Tax Act (Canada) and the regulations enacted thereunder
(collectively, the “Canadian Tax Act”) and the Canada-United States Tax Convention (1980) (the “Convention”) to
the holding and disposition of Common Shares.
Comment is restricted to holders of Common
Shares each of whom, at all material times for the purposes of the Canadian Tax Act and the Convention, (i) is resident solely in the
United States for tax purposes, (ii) is a “qualifying person” under and entitled to the benefits of the Convention, (iii)
holds all Common Shares as capital property, (iv) holds no Common Shares that are “taxable Canadian property” (as defined
in the Canadian Tax Act) of the holder, (v) deals at arm’s length with and is not affiliated with NioCorp, (vi) does not and is
not deemed to use or hold any Common Shares in a business carried on in Canada, (vii) is not an insurer that carries on business in Canada
and elsewhere, and (viii) is not an “authorized foreign bank” (as defined in the Canadian Tax Act) (each such holder, a “U.S.
Resident Holder”).
Certain U.S.-resident entities that are fiscally
transparent for United States federal income tax purposes (including limited liability companies) may not in all circumstances be entitled
to the benefits of the Convention. Members of or holders of an interest in such an entity that holds Common Shares should consult their
own tax advisers regarding the extent, if any, to which the benefits of the Convention will apply to the entity in respect of its Common
Shares.
Generally, a U.S. Resident Holder’s Common
Shares will be considered to be capital property of such holder provided that the U.S. Resident Holder is not a trader or dealer in securities,
did not acquire, hold, or dispose of the Common Shares in one or more transactions considered to be an adventure or concern in the nature
of trade (i.e., speculation) and does not hold the Common Shares in the course of carrying on a business.
This summary is based on the current provisions
of the Canadian Tax Act and the Convention in effect on the date hereof, all specific proposals to amend the Canadian Tax Act and Convention
publicly announced by or on behalf of the Minister of Finance (Canada) on or before the date hereof, and the current published administrative
and assessing policies of the Canada Revenue Agency (the “CRA”). It is assumed that all such amendments will be enacted as
currently proposed, and that there will be no other material change to any applicable law or administrative or assessing practice, whether
by way of judicial, legislative or governmental decision or action, although no assurance can be given in these respects. This summary
is not exhaustive of all possible Canadian federal income tax considerations. Except as otherwise expressly provided, this summary does
not take into account any provincial, territorial, or foreign tax considerations, which may differ materially from those set out herein.
This summary is of a general nature only,
is not exhaustive of all possible Canadian federal income tax considerations, and is not intended to be and should not be construed as
legal or tax advice to any particular U.S. Resident Holder. U.S. Resident Holders are urged to consult their own tax advisers for advice
with respect to their particular circumstances. The discussion below is qualified accordingly.
Generally, a U.S. Resident Holder’s Common
Shares will not constitute “taxable Canadian property” of such holder at a particular time at which the Common Shares are
listed on a “designated stock exchange” (which currently includes the TSX and Nasdaq) unless both of the following conditions
are concurrently met:
| (i) | at any time during the 60-month period that ends at the particular time, 25% or more of the issued shares of any class of the capital
stock of NioCorp were owned by or belonged to one or any combination of |
| (A) | the U.S. Resident Holder, |
| (B) | persons with whom the U.S. Resident Holder did not deal at arm’s length, and |
| (C) | partnerships in which the U.S. Resident Holder or a person referred to in clause (B) holds a membership
interest directly or indirectly through one or more partnerships, and |
| (ii) | at any time during the 60-month period that ends at the particular time, more than 50% of the fair market value of the Common Shares
was derived directly or indirectly from, one or any combination of, real or immovable property situated in Canada, “Canadian resource
properties” (as defined in the Canadian Tax Act), “timber resource properties” (as defined in the Canadian Tax Act),
or options in respect of, or interests in any of the foregoing, whether or not the property exists. |
Common Shares may also be deemed to be “taxable
Canadian property” in certain circumstances set out in the Canadian Tax Act.
A U.S. Resident Holder who disposes or is deemed
to dispose of one or more Common Shares generally should not thereby incur any liability for Canadian federal income tax in respect of
any capital gain arising as a consequence of the disposition.
A U.S. Resident Holder to whom NioCorp pays or credits
or is deemed to pay or credit a dividend on such holder’s Common Shares will be subject to Canadian withholding tax, and NioCorp
will be required to withhold the tax from the dividend and remit it to the CRA for the holder’s account. The rate of withholding
tax under the Canadian Tax Act is 25% of the gross amount of the dividend, but should generally be reduced under the Convention to 15%
(or, if the U.S. Resident Holder is a company which is the beneficial owner of at least 10% of the voting stock of NioCorp, 5%) of the
gross amount of the dividend. For this purpose, a company that is a resident of the United States for purposes of the Canadian Tax Act
and the Convention and is entitled to the benefits of the Convention shall be considered to own the voting stock of NioCorp owned by an
entity that is considered fiscally transparent under the laws of the United States and that is not a resident of Canada, in proportion
to such company’s ownership interest in that entity.
PLAN OF DISTRIBUTION
We are registering the resale by the Selling
Shareholders, or their permitted transferees, from time to time, of up to 10,495,370 Common Shares. We will not receive any of the proceeds
from the sale of the Common Shares by the Selling Shareholders. The aggregate proceeds to the Selling Shareholders will be the purchase
price of the Common Shares less any discounts and commissions borne by the Selling Shareholders. We are required to pay all fees and expenses
incident to the registration of the Common Shares to be offered and sold pursuant to this prospectus. The Selling Shareholders will bear
all commissions and discounts, if any, attributable to their sale of such Common Shares.
The Common Shares beneficially owned by the
Selling Shareholders covered by this prospectus may be offered and sold from time to time by the Selling Shareholders. The term “Selling
Shareholders” includes donees, pledgees, transferees or other successors in interest selling Common Shares covered by this prospectus
and received after the date of this prospectus from the Selling Shareholders as a gift, pledge, partnership distribution or other transfer.
The Selling Shareholders will act independently of us in making decisions with respect to the timing, manner and size of each sale. Such
sales may be made on one or more exchanges or in the over-the-counter market or otherwise, at prices and under terms then prevailing or
at prices related to the then current market price or in negotiated transactions. The Selling Shareholders may sell Common Shares by one
or more of, or a combination of, the following methods:
| • | purchases by a broker-dealer as principal and
resale by such broker-dealer for its own account pursuant to this prospectus; |
| • | ordinary brokerage transactions and transactions
in which the broker solicits purchasers; |
| • | block trades in which the broker-dealer so engaged
will attempt to sell the Common Shares as agent but may position and resell a portion of the block as principal to facilitate the transaction; |
| • | an over-the-counter distribution in accordance
with the rules of Nasdaq; |
| • | through trading plans entered into by the Selling
Shareholders pursuant to Rule 10b5-1 under the Exchange Act in place at the time of an offering pursuant to this prospectus and any applicable
prospectus supplement hereto that provide for periodic sales of their Common Shares on the basis of parameters described in such trading
plans; |
| • | distributions to employees, members, limited
partners or stockholders of the Selling Shareholders; |
| • | through the writing or settlement of options
or other hedging transactions, whether through an options exchange or otherwise; |
| • | by pledge to secure debts and other obligations; |
| • | delayed delivery arrangements; |
| • | to or through underwriters or broker-dealers; |
| • | in “at the market” offerings, as
defined in Rule 415 under the Securities Act, at negotiated prices, at prices prevailing at the time of sale or at prices related to such
prevailing market prices, including sales made directly on a national securities exchange or sales made through a market maker other than
on an exchange or other similar offerings through sales agents; |
| • | in privately negotiated transactions; |
| • | in options transactions; |
| • | through a combination of any of the above methods
of sale; or |
| • | any other method permitted pursuant to applicable
law. |
In addition, any Common Shares that qualify
for sale pursuant to Rule 144 or another exemption from registration under the Securities Act or other such exemption may be sold under
Rule 144 or such other exemption rather than pursuant to this prospectus.
To the extent required, this prospectus may
be amended or supplemented from time to time to describe a specific plan of distribution. In connection with such transactions, broker-dealers
or other financial institutions may engage in short sales of the Common Shares in the course of hedging the positions they assume with
the Selling Shareholders. The Selling Shareholders may pledge Common Shares to a broker-dealer or other financial institution, and, upon
a default, such broker-dealer or other financial institution may effect sales of the pledged Common Shares pursuant to this prospectus
(as supplemented or amended to reflect such transaction).
In effecting sales, broker-dealers or agents
engaged by the Selling Shareholders may arrange for other broker-dealers to participate. Broker-dealers or agents may receive commissions,
discounts or concessions from the Selling Shareholders in amounts to be negotiated immediately prior to the sale.
In offering the Common Shares covered by this
prospectus, the Selling Shareholders and any broker-dealers who execute sales for the Selling Shareholders may be deemed to be “underwriters”
within the meaning of the Securities Act in connection with such sales. Any profits realized by the Selling Shareholders and the compensation
of any broker-dealer may be deemed to be underwriting discounts and commissions.
In order to comply with the securities laws
of certain states, if applicable, the Common Shares must be sold in such jurisdictions only through registered or licensed brokers or
dealers. In addition, in certain states the Common Shares may not be sold unless they have been registered or qualified for sale in the
applicable state or an exemption from the registration or qualification requirement is available and is complied with.
We also have agreed to indemnify YA and certain
other persons against certain liabilities in connection with the offering of Common Shares offered by YA hereby, including liabilities
arising under the Securities Act or, if such indemnity is unavailable, to contribute amounts required to be paid in respect of such liabilities.
YA has agreed to indemnify us against liabilities under the Securities Act that may arise from certain written information furnished to
us by YA specifically for use in this prospectus or, if such indemnity is unavailable, to contribute amounts required to be paid in respect
of such liabilities. Insofar as indemnification for liabilities arising under the Securities Act may be permitted to our directors, officers,
and controlling persons, we have been advised that in the opinion of the SEC this indemnification is against public policy as expressed
in the Securities Act and is therefore, unenforceable.
YA has represented to us that, during the period
commencing as of the time that YA first contacted the Company or the Company’s agents regarding the specific investment in the Company
contemplated by the Yorkville Convertible Debt Financing Agreement and ending immediately prior to the execution of the Yorkville Convertible
Debt Financing Agreement, YA has not directly or indirectly, nor has any person acting on behalf of or pursuant to any understanding with
YA, engaged in any transactions in the securities of the Company (including, without limitation, any short sale involving the Company’s
securities). YA has agreed that from and after the date of the Yorkville Convertible Debt Financing Agreement and ending when no Convertible
Debentures remain outstanding, none of YA or any of its officers, or any entity managed or controlled by YA, shall, directly or indirectly,
engage in any (i) “short sale” (as such term is defined in Rule 200 of Regulation SHO of the Exchange Act) of the Common Shares
or (ii) put equivalent position or any hedging transaction which establishes a net short position with respect to any securities of the
Company (including the Common Shares), with respect to each of clauses (i) and (ii) hereof, either for its own principal account or for
the principal account of any other such person or entity.
In addition, we will make copies of this prospectus
available to the Selling Shareholders for the purpose of satisfying the prospectus delivery requirements of the Securities Act. The Selling
Shareholders may indemnify any broker-dealer that participates in transactions involving the sale of the Common Shares against certain
liabilities, including liabilities arising under the Securities Act.
At the time a particular offer of Common Shares
is made, if required, a prospectus supplement will be distributed that will set forth the number of Common Shares being offered and the
terms of the offering, including the name of any underwriter, dealer or agent, the purchase price paid by any underwriter, any discount,
commission and other item constituting compensation, any discount, commission or concession allowed or reallowed or paid to any dealer,
and the proposed selling price to the public.
The Common Shares being offered by YA hereby
will not be qualified for distribution by prospectus in any jurisdiction of Canada, and may not be offered for sale, sold, assigned or
transferred in any jurisdiction of Canada except pursuant to a prospectus or exemption from the prospectus requirement under applicable
securities laws in Canada. YA shall not offer or sell any Common Shares directly or indirectly to any person whom, to YA’s knowledge,
is resident or located in a jurisdiction of Canada or acquiring such Common Shares for the benefit of another person resident or located
in a jurisdiction of Canada, or on any “marketplace” (as such term is defined in National Instrument 21-101 Marketplace
Operation) in Canada.
LEGAL MATTERS
The validity of the Common Shares offered by
this prospectus will be passed upon for us by Blake, Cassels & Graydon LLP, Vancouver, British Columbia, Canada.
EXPERTS
The consolidated financial statements of NioCorp
Developments Ltd. as of June 30, 2022 and 2021 and for each of the three years in the period ended June 30, 2022, incorporated by reference
in this prospectus and in the registration statement have been so incorporated in reliance on the report of BDO USA, LLP, an independent
registered public accounting firm, incorporated herein by reference given on the authority of said firm as experts in auditing and accounting.
The report on the consolidated financial statements contains an explanatory paragraph regarding NioCorp Developments Ltd.’s ability
to continue as a going concern.
The financial statements of GX Acquisition
Corp. II as of December 31, 2022 and 2021 and for the years ended December 31, 2022 and 2021, have been audited by Marcum LLP, an independent
registered public accounting firm, as set forth in their report (which contains an explanatory paragraph relating to substantial doubt
about the ability of GX Acquisition Corp. II to continue as a going concern as described in Note 1 to GXII’s financial statements),
and are incorporated by reference in this prospectus and in the registration statement of which this prospectus is a part have been so
incorporated in reliance on such report given upon such firm as experts in auditing and accounting.
The technical report summary for the Elk Creek
Project prepared in accordance with subpart 1300 of Regulation S-K (the “S-K 1300 Elk Creek Technical Report Summary”), which
is incorporated by reference in this prospectus, and the information summarized or quoted from the S-K 1300 Elk Creek Technical Report
Summary included or incorporated by reference in this prospectus have been so included or incorporated by reference with the consent
of the following qualified persons, as such term is defined in Item 1300 of Regulation S-K, who prepared the S-K 1300 Elk Creek Technical
Report Summary and reviewed and approved such information summarized or quoted therefrom included or incorporated by reference in this
prospectus: Dahrouge Geological Consulting USA Ltd.; Understood Mineral Resources Ltd.; Optimize Group; Tetra Tech; Adrian Brown Consultants
Inc.; Metallurgy Concept Solutions; Magemi Mining Inc.; L3 Process Development; Olsson; A2GC; Scott Honan, M.Sc, SME-RM, NioCorp; Everett
Bird, P.E., Cementation; Matt Hales, P.E., Cementation; Mahmood Khwaja, P.E., CDM Smith; Martin Lepage, P.Eng, Cementation; and Wynand
Marx, M.Eng, BBE Consulting. A matrix of the sections of the S-K 1300 Elk Creek Technical Report Summary for which each qualified person
is responsible is included in the S-K 1300 Elk Creek Technical Report Summary. Except for Scott Honan, none of the qualified persons
is affiliated with NioCorp. Mr. Honan is the Chief Operating Officer of NioCorp.
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