Golden Minerals Co 10-K

ITEM 7: MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS You should read the following discussion and analysis of our financial condition and results of operations together with our financial statements and related notes beginning on page F-1 in this Form 10-K. This section contains forward-looking statements that involve risks, uncertainties and assumptions. Our actual results may differ materially from those anticipated in these forward-looking statements as a result of many factors, including those set forth under “Risk Factors” in this Form 10-K. Our Company We were incorporated in Delaware in March 2009 under the Delaware General Corporation Law. We are an exploration company holding or controlling majority interests in the Desierto and Sarita Este concessions, adjoining gold-silver-copper exploration projects located in northwest Salta Province Argentina. We have also earned in a 60% interest in Sand Canyon, an exploration-stage, gold-silver project in northwestern Nevada, and have interests in other immaterial mineral exploration properties located primarily in or near historical precious metals producing regions in Argentina and Mexico. We are primarily focused on advancing exploration activities at the Sarita Este/Desierto project. We continue to review additional exploration opportunities, primarily in South America. We restarted mining at our Velardeña Properties in December 2023 and continued through the end of February 2024 when it was determined that the initial performance of both the mine and the plant did not achieve expected results. We processed all the mineralized material that had been mined, shut down the sulfide processing plant at the end of March 2024 and held the Velardeña Properties for short-term sale as we evaluated options to realize value from the assets. We entered into the Velardeña Sales Agreements to sell the Velardeña and Chicago mines, both sulfide and oxide processing plants, water wells, and related equipment of the Velardeña Properties to the Velardeña Buyer in exchange for an aggregate purchase price of $5.5 million in cash, plus VAT. The first three of the Velardeña Sales Agreements which included the combined sales of the Velardeña and Chicago mines, the sulfide processing plant and various related equipment were completed on June 20, 2024, and the titles to the assets were transferred to the Velardeña Buyer. The Velardeña Buyer agreed to pay $3.0 million plus VAT on July 1, 2024, to complete the fourth and final of the Velardeña Sales Agreements which covered the oxide processing plant and water wells. We received the $3.0 million purchase price in a series of periodic payments, with the Velardeña Buyer making the final payment on October 10, 2025. With this closing, we have transferred the title to the oxide plant and the water wells to the Velardeña Buyer and have now fully divested our Velardeña operations, allowing us to concentrate our resources on advancing our exploration portfolio. In October 2024, we completed the sale of Silex Argentina, which was the sole owner of El Quevar, our advanced exploration property in Argentina for $3.5 million. We also completed the sale of our Yoquivo exploration property in Mexico in November 2024 for $570,000 plus VAT and the sale of a Mexican subsidiary holding tax losses for $445,000. In April 2025 we completed the sale of an additional Mexican subsidiary holding tax losses and 5 minor property concessions for $600,000. During December 2025 we completed the sale of two additional subsidiaries in Mexico for $65,000 and transferred net operating losses, inflation-adjusted capital contributions, and several liabilities, including past due payables, labor claims and the Rodeo mining concession, along with its reclamation obligation of approximately $450,000. The Company continues to hold an interest in several remaining exploration properties, including Sarita Este/Desierto, a gold-silver-copper exploration project located in northwest Salta Province Argentina and Sand Canyon, an exploration stage, gold-silver project in northwestern Nevada. Because we have divested our mining operations at Velardeña and Rodeo, our only near-term opportunity to generate cash flow is from the sale of additional assets or new sources of debt or equity capital. The Company is evaluating and pursuing alternatives to obtain funds to continue as a going concern, including the potential sale of the Company, seeking buyers or partners for certain of the Company’s other assets or obtaining equity or other external financing. In the absence of additional cash inflows, the Company anticipates that its cash resources will be exhausted in the second quarter of 2026. If we are unable to obtain additional cash resources or sell the Company, we will be forced to cease operations and liquidate. 34 2025 Highlights The Company has achieved a significant reduction in liabilities and a significant decrease in its cost structure through its restructuring efforts in 2024 which continued during 2025. These combined actions have allowed us to strengthen our balance sheet and preserve capital, enabling us to shift focus toward our most promising exploration assets as further described below. Sarita Este / Desierto Project The Desierto project, located in the Puna geological region of Salta Province, Argentina, has been the subject of surface exploration that identified zones of alteration, including clay and silica-rich areas typically associated with precious metal systems. The Company controls 67% of the Desierto Project. In 2025 the Company completed joint venture agreements for the Sarita Este property, 51% owned, with Cascadero, and remains in negotiation with Cascadero regarding joint venture arrangements for Desierto. Pending the resolution of the joint venture agreement, the Company anticipates initiating a Phase I drill program designed to test extensions of gold mineralization observed at the adjacent Sarita Este property into Desierto. The timing and scope of any such drilling program will depend on the completion of joint venture agreements and the Company’s ability to secure additional funding. Data obtained from the initial drilling program is expected to support refinement of the Desierto geological model and further evaluation of potential synergies with the Sarita Este project . Sand Canyon Project In January 2025, the Company exercised its option to earn a 60% interest in the Sand Canyon project, located in Humboldt County, Nevada, pursuant to its agreement with Golden Gryphon Explorations, Inc. The parties are currently working to finalize joint venture documentation. The Company is continuing to review and integrate historical exploration data and technical studies to inform future exploration plans. Sale of Minera de Cordilleras In April 2025, the Company completed the sale of its wholly owned subsidiary, Minera de Cordilleras S. de R.L. de C.V., for total consideration of $600,000. The subsidiary held five non-core mining concessions in Mexico and accumulated tax loss carryforwards and inflation-adjusted capital contributions. Sale of Additional Subsidiaries in Mexico On December 30, 2025, the Company completed the sale of its wholly owned subsidiaries, Servicios Velardeña S.A. de. C.V. and GMC Equipos S.A. de C.V., to a privately held Mexican group. Servicios Velardeña S.A. de. C.V. and GMC Equipos S.A. de C.V. held net operating losses, inflation-adjusted capital contributions, several liabilities including past-due accounts payable, the remaining labor claim in Mexico of $56,000, and the Rodeo mining concession, along with its associated asset retirement obligation with a value of approximately $450,000. This transaction, along with completion of the sale of our Velardeña Properties, represents a significant step forward in the Company’s planned exit from Mexico, allowing us to substantially eliminate our liabilities in the country and reduce ongoing overhead and administrative costs to a minimum, enabling us to focus on other regions. Results of Operations For the results of operations discussed below, we compare the results of operations for the year ended December 31, 2025, to the results of operations for the year ended December 31, 2024. 35 Exploration expense. Our exploration expense, including property holding costs and allocated administrative expenses, totaled $0.9 million and $0.6 million for the years ended December 31, 2025 and 2024, respectively. Our costs were higher in 2025 due to option payments on our projects in Argentina as well as recognition of contingent liability for certain labor claims, described below. Administrative expense. Administrative expenses totaled $2.3 million for the year ended December 31, 2025, compared to approximately $3.6 million for the year ended December 31, 2024. Administrative expenses, including costs associated with being a public company, are incurred primarily by our corporate activities in support of our exploration portfolio. The lower administrative expense we incurred during 2025 is primarily related to our cost reduction efforts. Stock-based compensation. During the years ended December 31, 2025 and 2024, we incurred approximately $0.3 million and $0.4 million, respectively, of expense related to stock-based compensation. Stock-based compensation varies from period to period depending on the number and timing of awards granted, the type of grant, the market value of the shares on the date of grant and other variables. Interest and other income, net. We recorded a nominal amount of interest and other income, net for the years ended December 31, 2025 and 2024. Our interest income pertains primarily to the interest earned on cash balances held in bank accounts. Loss on foreign currency transactions. We recorded a nominal amount of loss on foreign currency transactions for the years ended December 31, 2025 and 2024. Foreign currency gains and losses are primarily related to the effect of currency fluctuations on monetary assets net of liabilities held by our foreign subsidiaries that are denominated in currencies other than U.S. dollars. Income Taxes. We recorded zero income tax expense for the years ended December 31, 2025 and 2024. Income (Loss) from discontinued operations, net of taxes. In 2024, certain businesses were classified as assets held for sale and discontinued operations, including the Rodeo and Velardeña Properties in Mexico and the El Quevar property in Argentina. We recognized income from discontinued operations during 2025 of $6.1 million compared to a loss of $3.0 million during the year ended December 31, 2024. Income (loss) from discontinued operations, net of taxes included the following major components: ● Sale of metals . Revenue from the sale of metals decreased from $1.4 million for the year ended December 31, 2024 to $nil for the year ended December 31, 2025 primarily due to ceasing mining operations at the Rodeo and Velardeña Properties. ● Cost of metals sold . For the years ended December 31, 2025 and 2024, we recorded $nil and $6.4 million of cost of metals sold, respectively. The decrease in costs was due to the discontinuation of mining operations. ● Exploration . These costs primarily include property holding costs, limited exploration activities, and other costs associated with maintaining the projects held for sale. Exploration and other operation costs were $0.9 million compared to $1.1 million for the years ended December 31, 2025 and 2024, respectively, as we continued to wind down the operations at these properties. ● Reclamation and accretion expense. During the years ended December 31, 2025 and 2024, we incurred approximately $0.3 million of reclamation expense related to the accretion of asset retirement obligations at the Velardeña and Rodeo properties. ● Asset impairment expense. During the year ended December 31, 2024, in accordance with ASC 360, the Company recorded an asset impairment expense of $0.6 million, reducing the remaining book value of the oxide plant and water wells to the salvage value. 36 ● Other operating income, net . We recorded a nominal amount of other operating income for the year ended December 31, 2025. We recorded $0.4 million of other operating income for the year ended December 31, 2024 primarily related to toll mineral processing services. ● Gain on sale of assets held for sale. We recorded $7.3 million in gain from the sale of Minera de Cordilleras, Servicios Velardeña S.A. de. C.V. and GMC Equipos S.A. de C.V, as well as from the finalization of the sale of the Velardeña Properties during 2025. All amounts received from the Velardeña Buyer were accounted for as deferred revenue and were recorded as gain on sale of assets held for sale upon the receipt of the entire consideration of $3.0 million during 2025. During the year ended December 31, 2024, we recorded $3.6 million of gain on sale of the Velardeña sulfide plant, the Velardeña and Chicago mines, Minera Labri, Silex Argentina, and Yoquivo. ● Depreciation and amortization . For the years ended December 31, 2025 and 2024, we recorded $nil and $0.1 million of depreciation and amortization, respectively. For additional details on the major components of the loss from discontinued operations, please refer to “ Item 8 Financial Statements and Supplementary Data—Note 4. Assets Held for Sale and Discontinued Operations ” in this Form 10-K. Liquidity, Capital Resources and Going Concern Liquidity Forecast and Going Concern Qualification We do not currently have sufficient resources to meet our expected cash needs for a period of twelve months beyond the filing date of this 2025 Annual Report on Form 10-K. At December 31, 2025, we had current assets of approximately $1.9 million, consisting primarily of our cash and cash equivalents, and restricted cash. On the same date, we had accounts payable and other current liabilities of approximately $1.4 million. The Company’s only near-term opportunity to generate cash flow to meet its expected cash requirements is from the sale of its remaining exploration assets, equity or other external financing. The Company is evaluating and pursuing alternatives, including the potential sale of the Company, seeking buyers or partners for the Company’s remaining exploration assets or obtaining equity or other external financing. In the absence of additional cash inflows, the Company anticipates that its cash resources will be exhausted in approximately the second quarter of 2026. If we are unable to obtain additional cash resources or sell the Company, we will be forced to cease operations and liquidate. The Company’s consolidated financial statements have been prepared on a going concern basis under which an entity is considered to be able to realize its assets and satisfy its liabilities in the normal course of business. However, as noted above, our continuing long-term operations will be dependent upon our ability to secure sufficient funding to generate future profitable operations. The underlying value and recoverability of the amounts shown as property, plant and equipment in our consolidated financial statements are dependent on our ability to generate positive cash flows from operations and to fund general administrative, and exploration activities that would lead to additional profitable mining and processing activities or to generate proceeds from the disposition of property, plant and equipment. The ability of the Company to maintain a positive cash balance for a period of twelve months beyond the filing date of this 2025 Annual Report on Form 10-K is dependent upon its ability to generate sufficient cash flow from selling assets, reducing expenses, and raising sufficient funds through equity financings or other external sources. These material uncertainties cast significant doubt on the Company’s ability to continue as a going concern. Therefore, the Company cannot conclude that substantial doubt does not exist as to the Company’s ability to continue as a going concern for the twelve months following the filing date of this Annual Report on Form 10-K. The financial statements do not include any adjustments relating to the recoverability and classification of recorded assets or liabilities which might be necessary should the Company not continue as a going concern. 37 2025 Liquidity Discussion At December 31, 2025, our aggregate cash and cash equivalents totaled $1.3 million, compared to $3.2 million in similar assets held at December 31, 2024. This decrease is the result of the following expenditures and cash inflows for the year ended December 31, 2025. ● $1.0 million cash spent on discontinued operations, primarily related to care and maintenance cost of the projects in Mexico; ● $2.7 million in general and administrative and exploration expenditures. The above expenditures were partially offset by cash inflows of $1.8 million from the following: ● $1.2 million of proceeds received from the sale of Velardeña Plant 2 and water wells; and ● $0.6 million from the sale of certain Mexican subsidiaries. Critical Accounting Policies and Estimates The selection and application of accounting policies is an important process that has developed as our business activities have evolved and as the accounting rules have changed. Accounting rules generally do not involve a selection among alternatives, but involve implementation and interpretation of existing rules, and the use of judgment, to the specific set of circumstances existing in our business. Discussed below are the accounting policies that we believe are critical to our financial statements due to the degree of uncertainty regarding the estimates or assumptions involved and the magnitude of the asset, liability, revenue or expense being reported. Mineral Reserves We do not have defined mineral reserves pursuant to S-K 1300 and all of our mining properties are in the exploration stage. When and if we determine that a mining property has mineral reserves, subsequent development costs will be capitalized to those properties. When and if we commence extraction at our mining properties with defined mineral reserves, capitalized costs would be charged to operations using the units-of-production method. We cannot be certain that any part of the deposits at our properties will ever be confirmed or converted into S-K 1300 compliant reserves. Asset Retirement Obligations We record asset retirement obligations in accordance with ASC 410, “Asset Retirement and Environmental Obligations” (“ASC 410”), which establishes a uniform methodology for accounting for estimated reclamation and abandonment costs. According to ASC 410, the fair value of a liability for an asset retirement obligation (“ARO”) is recognized in the period in which it is incurred if a reasonable estimate of fair value can be made. To the extent that the ARO is related to fixed plant and equipment, an offsetting asset retirement cost is capitalized as part of the carrying value of the assets with which it is associated and depreciated over the useful life of the asset. The Company’s asset retirement obligations as at December 31, 2025 were $nil. Long-Lived Assets Long-lived assets are recorded at cost and per the guidance of ASC 360 “Long-Lived Assets,” we assess the recoverability of our long-lived assets, including goodwill, whenever events or changes in circumstances indicate that the carrying value of the assets may not be recoverable. If the sum of estimated future net cash flows on an undiscounted basis is less than the carrying amount of the related asset, impairment is considered to exist. The related impairment loss is 38 measured by comparing estimated future net cash flows on a discounted basis or by comparing other market indicators to the carrying amount of the asset. Functional Currency Our potential revenue and external funding are primarily denominated in U.S. dollars. Additionally, substantially all of our significant expenditures are made with reference to U.S. dollars. Accordingly, the Company and its subsidiaries use the U.S. dollar as their functional and reporting currency. ITEM 8: FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA The consolidated financial statements and supplementary information filed as part of this Item 8 are listed under Part IV, Item 15, “Exhibits, Financial Statement Schedules” and contained in this Form 10-K at page F-1. ITEM 9: CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE None.