Idaho Strategic Resources, Inc. 10-K

ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA 41 Table of Contents REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM To the shareholders and the board of directors of Idaho Strategic Resources, Inc. Opinion on the Financial Statements We have audited the accompanying consolidated balance sheets of Idaho Strategic Resources, Inc. (the “Company”) as of December 31, 2024 and 2023, the related consolidated statements of operations, changes in stockholders’ equity and cash flows for each of the years then ended, and the related notes (collectively referred to as the “financial statements”). In our opinion, the financial statements present fairly, in all material respects, the financial position of the Company as of December 31, 2024 and 2023, and the results of its operations and its cash flows for each of the years then ended, in conformity with accounting principles generally accepted in the United States of America. Basis for Opinion These financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on the Company’s financial statements based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (“PCAOB”) and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB. We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud. The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. As part of our audits we are required to obtain an understanding of internal control over financial reporting but not for the purpose of expressing an opinion on the effectiveness of the Company’s internal control over financial reporting. Accordingly, we express no such opinion. Our audits included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that our audits provide a reasonable basis for our opinion. Critical Audit Matter Critical audit matters are matters arising from the current-period audit of the financial statements that were communicated or required to be communicated to the audit committee and that (1) relate to accounts or disclosures that are material to the financial statements and (2) involved our especially challenging, subjective, or complex judgments. We determined that there are no critical audit matters. We have served as the Company’s independent auditor since 2003. Assure CPA, LLC Spokane, Washington March 31, 2025 PCAOB Firm ID: 444 Idaho Strategic Resources, Inc. Table of Contents Page Consolidated Balance Sheets, December 31, 2024 and 2023 F-2 Consolidated Statements of Operations for the years ended December 31, 2024 and 2023 F-3 Consolidated Statement of Changes in Stockholders’ Equity For the years ended December 31, 2024 and 2023 F-4 Consolidated Statements of Cash Flows for the years ended December 31, 2024 and 2023 F-5 Notes to Consolidated Financial Statements F-6-F-18 F-1 Table of Contents Idaho Strategic Resources, Inc. Consolidated Balance Sheets December 31, 2024 and 2023 2024 2023 ASSETS Current assets: Cash and cash equivalents $ 1,106,901 $ 2,286,999 Investment in US treasury notes 7,775,193 - Gold sales receivable 1,578,694 1,038,867 Inventories 899,924 876,681 Joint venture receivable 2,892 2,080 Investment in equity security - 5,649 Other current assets 378,469 236,837 Total current assets 11,742,073 4,447,113 Property, plant and equipment, net of accumulated depreciation 12,904,065 10,233,640 Mineral properties, net of accumulated amortization 10,573,349 7,898,878 Investment in Buckskin Gold and Silver, Inc. 341,436 338,769 Investment in joint venture 435,000 435,000 Investment in US treasury notes, non-current 7,208,930 - Reclamation bonds 249,110 251,310 Deposits 567,667 285,079 Total assets $ 44,021,630 $ 23,889,789 LIABILITIES AND STOCKHOLDERS’ EQUITY Current liabilities: Accounts payable and accrued expenses $ 1,006,078 $ 484,221 Accrued payroll and related payroll expenses 564,090 266,670 Notes payable, current portion 709,381 978,246 Total current liabilities 2,279,549 1,729,137 Asset retirement obligations 305,409 286,648 Notes payable, long term 1,023,358 1,338,406 Total long term liabilities 1,328,767 1,625,054 Total liabilities 3,608,316 3,354,191 Commitments and Contingencies (Note 5 and 12) - - Stockholders’ equity: Preferred stock, no par value, 1,000,000 shares authorized; no shares issued or outstanding - - Common stock, no par value, 200,000,000 shares authorized; 13,665,058 and 12,397,615 shares issued and outstanding, respectively 46,059,318 34,963,739 Accumulated deficit ( 8,373,953 ) ( 17,210,638 ) Total Idaho Strategic Resources, Inc. stockholders’ equity 37,685,365 17,753,101 Non-controlling interest 2,727,949 2,782,497 Total stockholders’ equity 40,413,314 20,535,598 Total liabilities and stockholders’ equity $ 44,021,630 $ 23,889,789 The accompanying notes are an integral part of these consolidated financial statements. F-2 Table of Contents Idaho Strategic Resources, Inc. Consolidated Statements of Operations For the Years Ended December 31, 2024 and 2023 2024 2023 Revenue-gold sales $ 25,765,373 $ 13,656,733 Cost of sales: Cost of sales and other direct production costs 10,861,492 8,224,994 Depreciation and amortization 1,953,388 1,466,703 Total cost of sales 12,814,880 9,691,697 Gross profit 12,950,493 3,965,036 Other operating expenses: Exploration 2,920,535 1,523,221 (Gain) loss on disposal of equipment 1,431 ( 13,026 ) Management 407,715 255,579 Professional services 432,237 556,766 General and administrative 763,040 630,126 Total other operating expenses 4,524,958 2,952,666 Income from operations 8,425,535 1,012,370 Other (income) expense: Equity income on investment in Buckskin Gold and Silver, Inc. ( 2,667 ) ( 4,517 ) Loss on investment in equity securities 453 5,451 Timber revenue ( 19,406 ) ( 20,724 ) Interest income ( 389,517 ) ( 85,491 ) Interest expense 83,295 44,202 Total other (income) expense ( 327,842 ) ( 61,079 ) Net income 8,753,377 1,073,449 Net loss attributable to non-controlling interest ( 83,308 ) ( 84,297 ) Net income attributable to Idaho Strategic Resources, Inc. $ 8,836,685 $ 1,157,746 Net income per common share-basic $ 0.68 $ 0.09 Weighted average common shares outstanding-basic 13,026,487 12,254,539 Net income per common share-diluted $ 0.67 $ 0.09 Weighted average common shares outstanding-diluted 13,197,308 12,260,539 The accompanying notes are an integral part of these consolidated financial statements. F-3 Table of Contents Idaho Strategic Resources, Inc. Consolidated Statements of Changes in Stockholders’ Equity For the Years Ended December 31, 2024 and 2023 Common Stock Shares Common Stock Amount Accumulated Deficit Attributable to Idaho Strategic Resources, Inc. Non-Controlling Interest Stockholders’ Equity Balance, December 31, 2022 12,098,070 $ 33,245,622 $ ( 18,368,384 ) $ 2,835,832 $ 17,713,070 Contribution from non-controlling interest in New Jersey Mill Joint Venture - - - 30,962 30,962 Issuance of common stock for cash, net of issuance costs 299,545 1,718,117 - - 1,718,117 Net income (loss) - - 1,157,746 ( 84,297 ) 1,073,449 Balance, December 31, 2023 12,397,615 $ 34,963,739 $ ( 17,210,638 ) $ 2,782,497 $ 20,535,598 Contribution from non-controlling interest in New Jersey Mill Joint Venture - - - 28,760 28,760 Issuance of common stock for cash, net of issuance costs 766,293 9,120,521 - - 9,120,521 Issuance of common stock for warrants exercised 289,294 1,695,047 - - 1,695,047 Issuance of common stock for stock options exercised 50,002 280,011 - - 280,011 Issuance of common stock for cashless stock options exercised 161,854 - - - - Net income (loss) - - 8,836,685 ( 83,308 ) 8,753,377 Balance, December 31, 2024 13,665,058 $ 46,059,318 $ ( 8,373,953 ) $ 2,727,949 $ 40,413,314 The accompanying notes are an integral part of these consolidated financial statements. F-4 Table of Contents Idaho Strategic Resources, Inc. Consolidated Statements of Cash Flows For the Years Ended December 31, 2024 and 2023 2024 2023 Cash flows from operating activities: Net income $ 8,753,377 $ 1,073,449 Adjustments to reconcile net income to net cash provided by operating activities: Depreciation and amortization 1,953,388 1,466,703 Accretion of asset retirement obligation 18,761 15,952 (Gain) loss on disposal of equipment 1,431 ( 13,026 ) Loss on investment in equity securities 453 5,451 Equity income on investment in Buckskin Gold and Silver, Inc. ( 2,667 ) ( 4,517 ) Write down of reclamation bond 300 - Change in operating assets and liabilities: Gold sales receivable ( 539,827 ) ( 128,870 ) Inventories ( 23,243 ) ( 258,368 ) Joint venture receivable ( 812 ) ( 154 ) Other current assets ( 141,632 ) ( 44,812 ) Accounts payable and accrued expenses 521,857 ( 95,320 ) Accrued payroll and related payroll expenses 297,420 87,521 Net cash provided by operating activities 10,838,806 2,104,009 Cash flows from investing activities: Purchases of property, plant, and equipment ( 2,219,147 ) ( 772,245 ) Proceeds from sale of equipment 6,372 8,500 Deposits on equipment ( 1,178,185 ) ( 285,079 ) Additions to mineral properties ( 2,392,822 ) ( 1,118,021 ) Purchase of reclamation bonds ( 5,000 ) - Refund of reclamation bonds 6,900 75,710 Purchase of US treasury notes ( 14,984,123 ) - Proceeds from sale of investment in equity securities 5,196 - Purchase of equity securities - ( 11,100 ) Net cash used by investing activities ( 20,760,809 ) ( 2,102,235 ) Cash flows from financing activities: Proceeds from sale of common stock, net of issuance costs 9,120,521 1,718,117 Proceeds from issuance of common stock for warrants exercised 1,695,047 - Proceeds from issuance of common stock for stock options exercised 280,011 - Principal payments on notes payable ( 2,382,434 ) ( 1,026,702 ) Principal payments on notes, related parties - ( 75,183 ) Contributions from non-controlling interest 28,760 30,962 Net cash provided by financing activities 8,741,905 647,194 Net change in cash and cash equivalents ( 1,180,098 ) 648,968 Cash and cash equivalents, beginning of year 2,286,999 1,638,031 Cash and cash equivalents, end of year $ 1,106,901 $ 2,286,999 Supplemental disclosure of cash flow information: Non-cash investing and financing activities: Deposit on equipment applied to purchase $ 895,597 $ 76,110 Notes payable for equipment 1,148,521 1,168,893 Notes payable for mineral property 650,000 - The accompanying notes are an integral part of these consolidated financial statements. F-5 Table of Contents Idaho Strategic Resources, Inc. Notes to Consolidated Financial Statements 1. Description of Business Idaho Strategic was incorporated as an Idaho corporation on July 18, 1996 . The Company’s primary business is exploring for, developing, and extracting gold, and to a lesser extent, silver, and base metal mineral resources in the Greater Coeur d’Alene Mining District of North Idaho. From an operational perspective, the Company produces gold at the Golden Chest located in the Murray Gold Belt area of the world-class Coeur d’Alene Mining District, north of the prolific Silver Valley. With over 7,000 acres of patented and unpatented land, the Company has the largest private land position in the area following its consolidation of the Murray Gold Belt for the first time in over 100-years. In addition to gold and gold production, the Company maintains an important strategic presence in the U.S. Critical Minerals sector, specifically focused on the more “at-risk” REE’s. Its business strategy is to grow its asset base and mineral production over time while advancing its REE projects. The Company’s Diamond Creek and Mineral Hill REE properties are included the U.S. national REE inventory as listed in USGS, IGS and DOE publications. Both projects are in central Idaho and participating in the USGS Earth MRI program, with the Diamond Creek Project also participating in the Idaho Department of Commerce’s IGEM program. 2. Summary of Significant Accounting Policies Principles of Consolidation The consolidated financial statements include the accounts of the Company and its majority-owned subsidiary, the New Jersey Mill JV (“NJMJV”). Intercompany accounts and transactions are eliminated. The portion of NJMJV partially owned by another investor is presented as non-controlling interest on the consolidated balance sheets, statements of operations, and statement of changes in stockholders’ equity. Accounting for Investments in JVs and Equity Method Investments Investment in JVs For JVs where the Company holds more than 50% of the voting interest and has significant influence, the JV is consolidated with the presentation of non-controlling interest. In determining whether significant influence exists, the Company considers its participation in policy-making decisions and its representation on the venture’s management committee. For JVs in which the Company does not have joint control or significant influence, the cost method is used. For those JVs in which there is joint control between the parties, the equity method is utilized whereby the Company’s share of the ventures’ earnings and losses is included in the statement of operations as earnings in JVs and its investments therein are adjusted by a similar amount. The Company periodically assesses its investments in JVs for impairment. If management determines that a decline in fair value is other than temporary it will write-down the investment and charge the impairment against operations. Equity Method Investments Investments in companies and JVs in which the Company exercises significant influence, but do not control, are accounted for under the equity method of accounting. In determining whether significant influence exists, the Company considers its participation in policy-making decisions and representation on governing bodies. Under the equity method of accounting, the Company’s share of the net earnings or losses of the investee are included in net income (loss) in the consolidated statements of operations. Upon investment, the Company assesses whether a step up in basis of the investee’s net assets has occurred and, if so, adjust its share of net earnings or losses by related depreciation and amortization expense. The Company evaluates equity method investments whenever events or changes in circumstance indicate the carrying amounts of such investments may be impaired. If a decline in the value of an equity method investment is determined to be other than temporary, a loss is recorded in earnings in the current period. As changes in ownership percentage of the Company’s investments occur, the Company assesses whether we can exercise significant influence and account for under the equity method. If the Company’s ownership percentage of the company or venture in which it has an investment changes, a gain or loss on the investment is recognized in the period of change. At December 31, 2024, the Company’s 37 % common stock holding of Buckskin Gold and Silver, Inc. (“Buckskin”) is accounted for using the equity method (Note 9). F-6 Table of Contents Idaho Strategic Resources, Inc. Notes to Consolidated Financial Statements 2. Summary of Significant Accounting Policies (continued) At December 31, 2024 and 2023, the Company’s percentage ownership and method of accounting for each JV and equity method investment is as follows: December 31, 2024 December 31, 2023 JV/Equity % Ownership Significant Influence? Accounting Method % Ownership Significant Influence? Accounting Method NJMJV 65 % Yes Consolidated 65 % Yes Consolidated Butte Highlands JV 50 % No Cost 50 % No Cost Buckskin 37 % Yes Equity 37 % Yes Equity Non-controlling Interest Non-controlling interests in the net assets of consolidated subsidiaries are identified separately from the Company’s stockholders’ equity and its net income (loss). Non-controlling interests represent non-controlling investor’s initial contribution at the date of the original acquisition, ongoing contributions, and percentage share of earnings since inception. Use of Estimates The preparation of financial statements in conformity with accounting principles generally accepted in the US requires management to make estimates and assumptions that affect the amounts reported in the financial statements and accompanying notes for items such as mineral reserves, depreciation lives and methods, potential impairment of long-lived assets and equity method investments, deferred income taxes, settlement pricing of gold sales, fair value of stock based compensation, estimation of asset retirement obligations and reclamation liabilities. Estimates are based on experience and various other assumptions that the Company believes are reasonable. Actual results may differ from those estimates. Revenue Recognition Gold Revenue Recognition and Receivables: Sales of gold sold directly to customers are recorded as revenues and receivables upon completion of the performance obligations and transfer of control of the product to the customer. For concentrate sales, the performance obligation is met, the transaction price can be reasonably estimated, and revenue is recognized generally at the time of shipment at estimated forward prices for the anticipated month of settlement. The embedded derivative contained in our concentrate sales is adjusted to fair value through earnings each period prior to final settlement. Due to the time elapsed from shipment to the customer and the final settlement with the customer, prices at which sales of our concentrates will be settled are estimated. Previously recorded sales and accounts receivable are adjusted to estimated settlement metals prices until final settlement by the customer. For sales of doré and metals from doré, the performance obligation is met, the transaction price is known, and revenue is recognized at the time of transfer of control of the agreed-upon metal quantities to the customer by the refiner. Sales and accounts receivable for concentrate shipments are recorded net of charges by the customer for treatment, refining, smelting losses, and other charges negotiated with the customers. Charges are estimated upon shipment of concentrates based on contractual terms, and actual charges typically do not vary materially from estimates. Costs charged by customers include fixed costs per ton of concentrate and price escalators. Refining, selling, and shipping costs related to sales of doré and metals from doré are recorded to cost of sales as incurred. See Note 13 for more information on our sales of products. Other Revenue Recognition: Revenue from harvest of raw timber is recognized when the performance obligation under a contract and transfer of control have both been completed. Sales of timber found on the Company’s mineral properties are not a part of normal operations. Inventories Inventories include concentrate inventory and supplies inventory. Concentrate inventory is valued at the lower of full cost of production or estimated net realizable value based on current metal prices. Costs consist of mining, transportation, royalties, and milling costs including applicable overhead, depreciation, depletion, and amortization relating to the operations. Costs are allocated based on the stage at which the ore is in the production process. Supplies inventory is stated at the lower of first-in, first-out weighted average cost or estimated net realizable value. Income Taxes Income taxes are recognized in accordance with Accounting Standards Codification 740 Income Taxes, whereby deferred income tax liabilities or assets at the end of each period are determined using the tax rate expected to be in effect when the taxes are actually paid or recovered. A valuation allowance is recognized on deferred tax assets when it is more likely than not that some or all of these deferred tax assets will not be realized. Uncertain tax positions are evaluated in a two-step process, whereby (i) it is determined whether it is more likely than not that the tax positions will be sustained based on the technical merits of the position and (ii) for those tax positions that meet the more-likely-than-not recognition threshold, the largest amount of tax benefit that is greater than 50% likely of being realized upon ultimate settlement with the related tax authority would be recognized . F-7 Table of Contents Idaho Strategic Resources, Inc. Notes to Consolidated Financial Statements 2. Summary of Significant Accounting Policies (continued) Fair Value Measurements When required to measure assets or liabilities at fair value, the Company uses a fair value hierarchy based on the level of independent, objective evidence surrounding the inputs used. The Company determines the level within the fair value hierarchy in which the fair value measurements in their entirety fall. The categorization within the fair value hierarchy is based upon the lowest level of input that is significant to the fair value measurement. Level 1 uses quoted prices in active markets for identical assets or liabilities, Level 2 uses significant other observable inputs, and Level 3 uses significant unobservable inputs. The amount of the total gains or losses for the period are included in earnings that are attributable to the change in unrealized gains or losses relating to those assets and liabilities still held at the reporting date. At December 31, 2024 and 2023, the Company did not have any assets or liabilities that were valued at a fair value measurement other than its gold sales receivable. Due to the time elapsed from shipment to the customer and the final settlement with the customer, management must estimate the prices at which sales of gold concentrates will be settled. Previously recorded sales and accounts receivable are adjusted to estimated settlement metals prices until final settlement by the customer. See Note 13 for further information. Financial Instruments The carrying amounts of financial instruments including cash and cash equivalents, reclamation bond, equity method investments, investments in US treasury notes and equity securities, and notes payable approximate their fair values. Net Income (Loss) Per Share Net income (loss) per share is computed by dividing net income (loss) attributable to the Company excluding net income (loss) attributable to a non-controlling interest by the weighted average number of common shares outstanding during the year. Diluted net income (loss) per share reflects the potential dilution that could occur from common shares issuable through stock options, warrants, and other convertible securities. For the years ended December 31, 2024, and 2023, Such common stock equivalents are included or excluded from the calculation of diluted net income per share for each period as follows: December 31, 2024 December 31, 2023 Incremental shares included in diluted net income per share Stock options 118,400 6,000 Stock purchase warrants 52,421 - 170,821 6,000 Potentially dilutive shares excluded from diluted net income per share as inclusion would have an antidilutive effect: Stock options - 321,449 Stock purchase warrants - 289,294 Total - 610,743 Cash and Cash Equivalents The Company considers cash in banks and other deposits with an original maturity of three months or less when purchased to be cash and cash equivalents. These deposit balances may at times exceed federally insured limits. No losses have been recognized because of these balances. Property, Plant and Equipment Property, plant, and equipment are stated at cost. Depreciation and amortization are based on the estimated useful lives of the assets and are computed using straight-line or units-of-production methods. The expected useful lives of most of the Company’s buildings are up to 50 years and equipment life expectancy ranges between 2 and 10 years . When assets are retired or sold, the costs and related allowances for depreciation and amortization are eliminated from the accounts and any resulting gain or loss is reflected in operations. Mineral Properties Significant payments related to the acquisition of mineral properties, mineral rights, and mineral leases are capitalized. If a commercially mineable ore body is discovered, such costs are amortized when production begins using the units-of-production method based on estimated reserves. If no commercially mineable ore body is discovered, or such rights are otherwise determined to have no value, such costs are expensed in the period in which it is determined the property has no future economic value. Consideration received by the Company pursuant to joint ventures or mineral interest agreements is applied against the carrying value of the related mineral interest. When and if payments received exceed the carrying value, the excess amount is recognized as a gain in the consolidated statement of operations in the period the consideration is received. F-8 Table of Contents Idaho Strategic Resources, Inc. Notes to Consolidated Financial Statements 2. Summary of Significant Accounting Policies (continued) Interest Capitalization When capital projects are funded within the reporting period for which cash is paid which could have been used for debt reduction an amount equal to a weighted average interest rate of qualifying outstanding debt of the capital project expenditure in interest expense is capitalized. Mine Exploration and Development Costs The Company expenses exploration costs as such in the period they occur. The exploration stage occurs up until the point ore reserves are identified. The pre-development stage begins once the Company identifies ore reserves which is based on a determination whether an ore body can be economically developed. Expenditures incurred during the pre-development stage are capitalized as deferred development costs and include such costs for drifts, ramps, and infrastructure. Costs to improve, alter, or rehabilitate primary development assets which appreciably extend the life, increase capacity, or improve the efficiency or safety of such assets are also capitalized. The pre-development stage ends when the production stage of ore reserves begins, thus entering the secondary development stage. Drilling, and related costs are either classified as exploration, pre-development or secondary development, as defined above, and charged to operations as incurred, or capitalized, based on the following criteria: · whether the costs are incurred to further define resources or exploration targets at and adjacent to existing reserve areas or intended to assist with mine planning within a reserve area; · whether the drilling or development costs relate to an ore body that has been determined to be commercially mineable, and a decision has been made to put the ore body into commercial production; and · whether, at the time the cost is incurred: (a) the expenditure embodies a probable future benefit that involves a capacity, singly or in combination with other assets, to contribute directly or indirectly to future net cash inflows, (b) we can obtain the benefit and control others’ access to it, and (c) the transaction or event giving rise to our right to or control of the benefit has already occurred. If all of these criteria are met, drilling, development and related costs are capitalized. Drilling and development costs not meeting all of these criteria are expensed as incurred. The following factors are considered in determining whether or not the criteria listed above have been met, and capitalization of drilling and development costs is appropriate: · completion of a favorable economic study and mine plan for the ore body targeted; · authorization of development of the ore body by management and/or the Board of Directors; and · there is a justifiable expectation, based on applicable laws and regulations, that issuance of permits or resolution of legal issues and/or contractual requirements necessary for us to have the right to or control of the future benefit from the targeted ore body have been met. Amortization of development costs is calculated using the units-of-production method over the expected life of the operation based on the estimated recoverable resources. Claim Fees Unpatented claim fees paid at time of staking are expensed when incurred. Recurring renewal fees which are paid annually are recorded as other current assets and expensed over the course of the year. Reclassifications Certain reclassifications have been made to conform the amounts presented in the December 31, 2023 financial statements to the current presentation. These reclassifications have no effect on the results of operations, stockholders’ equity and cash flows as previously reported. Impairment of Long-Lived Assets The Company evaluates the carrying amounts of its long-lived assets for impairment whenever events and circumstances indicate the carrying value may not be recoverable from the estimated future cash flows expected to result from its use and eventual disposition. If such events and circumstances exist, estimated undiscounted future net cash flows from each mineral property are calculated using estimated future production, three-year average metals prices, operating capital and costs, and reclamations costs. If the carrying value exceeds the undiscounted future net cash flows, estimated discounted future net cash flow is calculated. An impairment loss is recognized when the estimated discounted future cash flows expected to result from the use of an asset are less than the carrying amount of the specific asset group. The Company’s estimates of future cash flows are subject to risks and uncertainties. It is reasonably possible that changes in estimates could occur which may affect the expected recoverability of the Company’s investments in mineral properties. F-9 Table of Contents Idaho Strategic Resources, Inc. Notes to Consolidated Financial Statements 2. Summary of Significant Accounting Policies (continued) Asset Retirement Obligations and Remediation Costs Mineral properties are subject to standards for mine reclamation that have been established by various governmental agencies. Asset retirement obligations are related to the retirement of the mine when a contractual obligation has been established, and a reasonable estimate of fair value can be determined. These obligations are initially measured at fair value with the resulting cost recognized at the present value of estimated reclamation costs. The liability is accreted, and the asset amortized over the life of the related asset. Adjustments are made for changes resulting from either the timing or amount of the original estimate underlying the obligation. Separate from asset retirement obligations, the Company records liability for remediation costs when a reasonable estimate of fair value can be determined. Accrued remediation costs are not discounted. Reclamation Bonds Various laws and permits require that financial assurances be in place for certain environmental and reclamation obligations and other potential liabilities. In 2023, the Company deposited $2,890 in additional bonds for trenching activities at Lemhi Pass, and a partial refund of $78,600 occurred after reclaiming the drill pads from drilling the Diamond Creek project in 2022 . The remaining amount on this bond is expected to be refunded after revegetation is established. The balance of reclamation bonds at December 31, 2023 was $ 251,310 . In 2024 the Company deposited $ 5,000 in additional bonds for a mineral lease and received $ 6,900 of the remaining $ 7,200 on the Diamond Creek drilling bond from 2022. The final $ 300 for this bond was written off as an exploration expense during the year. The balance at December 31, 2024 is $ 249,110 . Stock Based Compensation All transactions in which goods or services are received for the issuance of shares of the Company’s common stock or options to purchase shares of common stock are measured at fair value of the equity interest issued. The fair value of common stock awards is determined based upon the closing price of the Company’s stock on the date of the award. The Company estimates the fair value of stock-based compensation of options using the Black-Scholes model, which requires the input of some subjective assumptions. These assumptions include estimating the length of time employees will retain their vested stock options before exercising them (“expected life”), the estimated volatility of the Company’s common stock price over the expected term (“volatility”), the risk-free interest rate and the dividend yield. Changes in the subjective assumptions can materially affect the estimate of the fair value of stock-based compensation. Any forfeitures of stock options are recognized as they occur. Investments in Equity Securities Investments in equity securities are generally measured at fair value. Unrealized gains and losses for equity securities resulting from changes in fair value are recognized in current earnings. If an equity security does not have a readily determinable fair value, we may elect to measure the security at its cost minus impairment, if any, plus or minus changes resulting from observable price changes in orderly transactions for an identical or similar investment in the same issuer. At the end of each reporting period, we reassess whether an equity investment security without a readily determinable fair value qualifies to be measured at cost less impairment, consider whether impairment indicators exist to evaluate if an equity investment security is impaired and, if so, record an impairment loss. At the end of each reporting period, unrealized gains and losses resulting from changes in fair value are recognized in current earnings. Upon sale of an equity security, the realized gain or loss is recognized in current earnings. Investments in US Treasury Notes The Company holds short and long term investments in US Treasury notes and are classified as held to maturity based on management’s intent and ability to hold them to maturity. Such debt securities are stated at cost, adjusted for unamortized purchase premiums and discounts and are amortized using the effective interest method over the stated terms of the securities. Amortization of the premium or discount is included in interest income on the consolidated statement of operations. Interest income is recognized when earned. Government Grant Income The Company occasionally receives grant income from various government agencies. Government grant income is recognized in earnings on a systematic basis in a manner that mirrors how the Company recognizes underlying costs for which the grant is intended to compensate. A grant receivable is recognized for expenses or losses already incurred but for which grant funding has not yet been received. Grant funding received in excess of expenses or losses incurred is recognized as deferred revenue. If a grant is received based solely on a capital expenditure, the amount of the asset is reduced by the amount received from the grant. Segment Reporting The Company operates as a single operating segment in accordance with ASU 2023-07 Segment Reporting (Topic 280): I mprovements to Reportable Segment Disclosures . All financial information is presented on a consolidated basis and reviewed by the Company’s Chief Executive Officer as the Chief Operating Decision Maker (CODM). The CODM uses consolidated net income, as presented in the consolidated statement of operations, to assess segment performance and allocate resources. The measure of segment assets is reported on the balance sheet as total consolidated assets. F-10 Table of Contents Idaho Strategic Resources, Inc. Notes to Consolidated Financial Statements 2. Summary of Significant Accounting Policies (continued) Recent Accounting Pronouncements Accounting Standards Updates Adopted In August 2023, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2023-05, Business Combinations-Joint Venture Formations (Subtopic 805-60): Recognition and Initial Measurement, which clarifies the business combination accounting for joint venture formations. The amendments in the ASU seek to reduce diversity in practice that has resulted from a lack of authoritative guidance regarding the accounting for the formation of joint ventures in separate financial statements. The amendments also seek to clarify the initial measurement of joint venture net assets, including businesses contributed to a joint venture. The guidance is applicable to all entities involved in the formation of a joint venture. The amendments are effective for all joint venture formations with a formation date on or after January 1, 2025. Early adoption and retrospective application of the amendments are permitted. We do not expect adoption of the new guidance to have a material impact on our consolidated financial statements and disclosures. In November 2023, the FASB issued ASU 2023-07, Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures, amending reportable segment disclosure requirements to include disclosure of incremental segment information on an annual and interim basis. Among the disclosure enhancements are new disclosures regarding significant segment expenses that are regularly provided to the chief operating decision-maker and included within each reported measure of segment profit or loss, as well as other segment items bridging segment revenue to each reported measure of segment profit or loss. The amendments in ASU 2023-07 are effective for fiscal years beginning after December 15, 2023, and for interim periods beginning January 1, 2025, and are applied retrospectively. The Company adopted this pronouncement for its fiscal year ended December 31, 2024. In December 2023, the FASB issued ASU 2023-09, Income Taxes (Topic 740): Improvement to Income Tax Disclosures, amending income tax disclosure requirements for the effective tax rate reconciliation and income taxes paid. The amendments in ASU 2023-09 are effective for fiscal years beginning after December 15, 2024 and are applied prospectively. Early adoption and retrospective application of the amendments are permitted. We are currently evaluating the impact of this update on our consolidated financial statements and disclosures. In November 2024, the FASB issued ASU 2024-03, Income Statement - Reporting Comprehensive Income - Expense Disaggregation Disclosures (Subtopic 220-40): Disaggregation of Income Statement Expenses, which requires disclosure about the types of costs and expenses included in certain expense captions presented on the income statement. The new disclosure requirements are effective for the Company’s annual periods for fiscal years beginning after December 15, 2026, and interim periods within fiscal years beginning after December 15, 2027, with early adoption permitted, and may be applied either prospectively or retrospectively. We are currently evaluating the ASU to determine its impact on our consolidated financial statements and disclosures. Management does not believe that any other recently issued, but not yet effective, accounting standards if currently adopted would have a material effect on the accompanying financial statements. 3. Inventories At December 31, 2024 and 2023, inventories consisted of the following: 2024 2023 Concentrate inventory In process $ - $ 28,778 Finished goods 334,033 239,361 Total concentrate inventory 334,033 268,139 Supplies inventory Mine parts and supplies 475,336 374,456 Mill parts and supplies 90,555 158,402 Core drilling supplies and materials - 75,684 Total supplies inventory 565,891 608,542 Total $ 899,924 $ 876,681 F-11 Table of Contents Idaho Strategic Resources, Inc. Notes to Consolidated Financial Statements 4. Property, Plant and Equipment Property, plant and equipment at December 31, 2024 and 2023 consisted of the following: 2024 2023 Mine Equipment 8,223,596 7,025,060 Accumulated Depreciation $ ( 3,845,349 ) $ ( 2,932,547 ) Total Mine Equipment 4,378,247 4,092,513 Mill Equipment 7,580,452 5,842,195 Accumulated Depreciation ( 2,453,673 ) ( 1,579,551 ) Total Mill Equipment 5,126,779 4,262,644 Buildings 2,715,931 1,152,406 Accumulated Depreciation ( 295,595 ) ( 252,626 ) Total Buildings 2,420,336 899,780 Land 978,703 978,703 Total $ 12,904,065 $ 10,233,640 5 . Mineral Properties Mineral properties at December 31, 2024 and 2023 are as follows: 2024 2023 Golden Chest Mineral Property $ 5,159,084 $ 4,108,710 Infrastructure 4,722,328 3,020,698 Total Golden Chest 9,881,412 7,129,408 New Jersey 256,768 256,768 McKinley-Monarch 200,000 200,000 Potosi 150,385 150,385 Park Copper/Gold 78,000 78,000 Eastern Star 250,817 250,817 Oxford 40,000 - Less accumulated amortization ( 284,033 ) ( 166,500 ) Total $ 10,573,349 $ 7,898,878 For the years ended December 31, 2024 and 2023, $ 98,330 and $ 102,727 , respectively, interest expense was capitalized in Golden Chest mineral property in association with core drilling and the ramp. Golden Chest The Golden Chest is an underground mine project currently producing for the Company located near Murray, Idaho consisting of 34 patented claims (449 acres) and 217 unpatented claims (4,300 acres). A 2% NSR is payable on production at certain portions of the Golden Chest to a former joint venture partner. Royalty expense of $510,186 and $272,535 was recognized as costs of sales and other direct production costs in the years ended December 31, 2024, and 2023, respectively . The greater Murray Area property package includes an additional 73 patented claims (1,300 acres) and 83 unpatented claims (1,660 acres) which is incorporated in the Golden Chest total. New Jersey The Coleman property is located at the New Jersey Mine area of interest and consists of 62 acres of patented mining claims, mineral rights to 108 acres of fee land, 80 acres of land for which the Company owns the surface but not the mineral rights, and approximately 130 acres of unpatented mining claims . McKinley-Monarch The McKinley-Monarch project is located near the town of Lucille, Idaho. The project consists of 28 unpatented claims totaling 560 acres. The Company started exploring the property in 2013 . F-12 Table of Contents Idaho Strategic Resources, Inc. Notes to Consolidated Financial Statements 5. Mineral Properties (continued) Potosi In 2018, the Company purchased the Potosi property near the Golden Chest. This property consists of 71 acres of patented mining claims . Park Copper/Gold In August 2021, the Company paid $78,000 in cash for 91 acres of patented mineral property in Shoshone County referred to as Park Copper/Gold . Eastern Star In 2014 the Company purchased the Eastern Star property near Elk City, Idaho for $250,817. This property consists of 11 patented claims (220 acres) and 71 unpatented claims (1,420 acres) . Oxford In 2024, the Company purchased unpatented mineral claims for $40,000. The greater Oxford property consists of 26 unpatented claims (537 acres) as well as a state mineral lease on 2,500 acres in Clearwater County, Idaho . 6. Notes Payable At December 31, 2024 and 2023, notes payable are as follows: 2024 2023 Mine Equipment Monthly payments of $ 55,803 and $ 98,752 as of December 31, 2024 and 2023, respectively $ 962,384 $ 1,859,299 Mill Equipment Monthly payments of $ 11,498 and $ 0 as of December 31, 2024 and 2023, respectively 540,773 - Buildings/Land Monthly payments of $ 2,500 and $ 2,500 as of December 31, 2024 and 2023, respectively 229,582 297,230 Other Monthly payments of $ 0 and $ 731 as of December 31, 2024 and 2023, respectively - 160,123 Total notes payable 1,732,739 2,316,652 Due within one year 709,381 978,246 Due after one year $ 1,023,358 $ 1,338,406 All notes are collateralized by the property or equipment purchased in connection with each note. Future principal payments of notes payable at December 31, 2024 are as follows: 2025 $ 709,381 2026 485,852 2027 313,374 2028 124,118 2029 100,014 Total $ 1,732,739 7. Asset Retirement Obligations The Company has established asset retirement obligations associated with the ultimate closing of its mineral properties where there has been or currently is operations. Obligations were established for the New Jersey Mill in 2014 and the Golden Chest in 2016. Activity for the years ended December 31, 2024 and 2023 is as follows: 2024 2023 Balance at January 1 $ 286,648 $ 262,217 Accretion expense 18,761 15,952 Change in asset retirement obligation estimate - 8,479 Balance at December 31 $ 305,409 $ 286,648 The change in the asset retirement obligation estimate during the year ended December 31, 2023 was due to a revision to the estimated start of the reclamation process and an updated reclamation cost estimate. F-13 Table of Contents Idaho Strategic Resources, Inc. Notes to Consolidated Financial Statements 8. Joint Venture Arrangements NJMJV Agreement In January 2011, the Company and Crescent (formerly United Mine Services, Inc.) entered into a JV agreement relating to the New Jersey Mill. To earn a 35 percent interest in the JV, Crescent provided $ 3.2 million in funding to expand the processing plant to 15 tonnes/hr. The Company is the operator of the JV and charges operating costs to Crescent for milling its ore up to 7,000 tonnes/month, retain a milling capacity of 3,000 tonnes/month, and as the operator of the JV, receive a fee of $2.50/tonne milled . No ore has been milled for Crescent since 2013. As of December 31, 2024 and 2023, an account receivable existed with the NJMJV from Crescent for $ 2,892 and $ 2,080 , respectively. Butte Highlands JV On January 29, 2016, the Company purchased a 50% interest in Butte Highlands JV, LLC (“BHJV”) for a total consideration of $ 435,000 . Highland Mining, LLC (“Highland”) is the other 50 % owner and manager of the JV. Under the operating agreement, Highland will fund all future project exploration and mine development costs. The Agreement stipulates that Highland is manager of the JV and will manage BHJV until such time as all mine development costs, less $ 2 million are distributed to Highland out of the proceeds from future mine production. The Company has determined that because it does not currently have significant influence over the JV’s activities and accounts, it will continue to account for its investment on a cost basis. 9. Investment in Buckskin In August 2021, the Company exchanged 45,940 shares of the Company’s common stock for 22 % of Buckskin. The Company’s closing share price on the date of the agreement (August 18, 2021) was recorded as the cost basis for the investment. In October 2021 the Company exchanged an additional 30,358 shares of the Company’s common stock for an additional 15 % of Buckskin. The Company’s closing share price on the date of the exchange (October 15, 2021) was recorded as the cost basis for the investment addition. This investment in Buckskin is being accounted for using the equity method and resulted in recognition of equity income on the investment of $ 2,667 and $ 4,517 during the years ended December 31, 2024 and 2023, respectively. The Company makes an annual payment of $ 12,000 to Buckskin per a lease covering 218 acres of patented mining claims. As of December 31, 2024 and 2023, the Company held 37 % of Buckskin’s outstanding shares. F-14 Table of Contents Idaho Strategic Resources, Inc. Notes to Consolidated Financial Statements 10. Income Taxes The Company did not recognize a provision (benefit) for income taxes for the years ended December 31, 2024 and 2023. The significant components of net deferred tax assets at December 31, 2024 and 2023 were as follows: 2024 2023 Deferred tax assets Net operating loss carry forwards $ 3,661,000 $ 5,205,300 Mineral properties 201,100 222,300 Asset retirement obligation 16,000 9,100 Stock based compensation 629,000 629,000 Other 26,500 24,500 Total deferred tax assets 4,533,600 6,090,200 Valuation allowance ( 3,176,700 ) ( 4,506,700 ) 1,356,900 1,583,500 Deferred tax liabilities Property, plant, and equipment ( 1,356,900 ) ( 1,583,500 ) Asset retirement obligation - - Total deferred tax liabilities ( 1,356,900 ) ( 1,583,500 ) Net deferred tax assets $ - $ - At December 31, 2024 and 2023, the Company had net deferred tax assets principally arising from the net operating loss carryforward for income tax purposes. As management of the Company cannot determine that it is more likely than not that the Company will realize the benefit of the deferred tax assets, a valuation allowance equal to 100 % of the net deferred tax asset exists at December 31, 2023 and 2022. At December 31, 2024, the Company had net operating loss carry forwards of approximately $ 14,311,000 for federal purposes, $ 4,684,000 which expire between 2030 through 2038. At December 31, 2024, the Company had net operating loss carry forwards of approximately $ 12,001,000 for state purposes, which expire between 2030 and 2042. The remaining balance of $ 9,627,000 will never expire but its utilization is limited to 80 % of taxable income in any future year. The income tax provision (benefit) for the years ended December 31, 2024 and 2023 differ from the statutory rate of 21 % as follows: 2024 2023 Provision (benefit) at statutory rate for the period $ 1,838,200 $ 225,400 State taxes, net of federal taxes 401,000 49,200 Taxable grant income 106,900 - Adjustment of prior year tax estimates ( 60,900 ) 218,200 Non-deductible items 3,400 - Depletion ( 958,600 ) - Increase (decrease) in valuation allowance ( 1,330,000 ) ( 492,800 ) Total provision (benefit) $ - $ - The Company is open to examination of its income tax filings in the United States and state jurisdictions for the 2022 through 2024 tax years. Tax attributes from years prior to that can be adjusted as a result of examinations. In the event that the Company is assessed penalties and or interest, penalties will be charged to other operating expense and interest will be charged to interest expense. The Company has reviewed its tax positions and believes it has not taken a position that would not be sustained under examination. F-15 Table of Contents Idaho Strategic Resources, Inc. Notes to Consolidated Financial Statements 11. Equity The Company has authorized 200,000,000 shares of no-par common stock at December 31, 2024 and 2023. In addition, the Company has authorized 1,000,000 shares of no-par preferred stock, none of which had been issued at December 31, 2024 or 2023. S tock Purchase Warrants Outstanding Transactions in common stock purchase warrants for the years ended December 31, 2024 and 2023 are as follows: Number of Warrants Exercise Prices Balance December 31, 2022 and 2023 289,294 $ 5.60 - 7.00 Exercised ( 289,294 ) $ 5.60 - 7.00 Balance December 31, 2024 - $ - Stock Options In April 2014, the Board of Directors of the Company established the 2014 Equity Incentive Compensation Plan to authorize the granting of stock options to officers and employees. Upon exercise of the options, shares are issued from the available authorized shares of the Company. Options reserved to any one related person on an annual basis may not, upon exercise, exceed 5% and the aggregate number of all options outstanding will not exceed 10% of the issued outstanding common shares in total as calculated at that time. In May 2023, the 2023 Equity Incentive Compensation Plan was voted on, and approved, by the shareholders of the Company. This plan allows for the issuance of up to 1,225,600 shares of the Company’s common stock in the form of stock options (which may be incentive stock options or nonqualified stock options) or other stock-based awards, such as stock appreciation rights, restricted stock, restricted stock units and performance shares. Transactions in stock options for the years ended December 31, 2024 and 2023 are as follows: Number of Options Weighted Average Exercise Prices Balance December 31, 2022 535,953 $ 5.47 Forfeited ( 58,504 ) $ 5.47 Balance December 31, 2023 477,449 $ 5.47 Exercised ( 376,590 ) $ 5.53 Forfeited ( 23,859 ) $ 5.51 Outstanding and exercisable at December 31, 2024 77,000 $ 5.17 At December 31, 2024 and 2023, the outstanding stock options have an intrinsic value of approximately $ 387,880 ($ 410,638 in 2023) and have a weighted average remaining term of 0.69 years ( 0.82 in 2023). The intrinsic value of stock options exercised for cash in the year ended December 31, 2024 was $ 263,516 . Cashless options exercised in the year ended December 31, 2024 had an intrinsic value of $ 1,958,047 . No cash or cashless options were exercised in the year ended December 31, 2023. 12. Related Party Transactions On May 10, 2023 the Company paid the remaining amount due on the note payable of $ 57,397 to Ophir Holdings, LLC, a company owned by two officers and one former officer of the Company. There has not been any other related party debt since this transaction. The Company leases office locations from certain related parties on a month-to-month basis (not long term). These related parties are NP Depot, a company owned by John Swallow, the Company’s president, and Mine Systems Design, a company partially owned by Grant Brackebusch, one of the Company’s vice presidents. Payments under these month-to-month lease arrangements totaled $ 30,684 and $ 25,175 for the years ended December 31, 2024 and 2023, respectively, and are included in general and administrative expenses on the consolidated statement of operations. F-16 Table of Contents Idaho Strategic Resources, Inc. Notes to Consolidated Financial Statements 13. Sales of Products The Company’s products consist of both gold flotation concentrates which in 2024 and 2023 were sold to a broker, H&H Metals Corp. (“H&H”), and an unrefined gold-silver product known as doré which is sold to a precious metal refinery. Revenue is recognized upon the completion of the performance obligations and transfer of control of the product to the customer, and the transaction price can be determined or reasonably estimated. For gold flotation concentrate sales, the performance obligation is met when the transaction price can be reasonably estimated, and revenue is recognized generally at the time when risk is transferred to H&H based on contractual terms. Based on contractual terms, the Company has determined the performance obligation is met and title is transferred to H&H when the Company receives its first provisional payment on the concentrate because, at that time, 1) legal title is transferred to the customer, 2) the customer has accepted the concentrate lot and obtained the ability to realize all of the benefits from the product, 3) the concentrate content specifications are known, have been communicated to H&H, and H&H has the significant risks and rewards of ownership to it, 4) it is very unlikely a concentrate will be rejected by H&H upon physical receipt, and 5) the Company has the right to payment for the concentrate. Concentrates lots that have been sold are held at the New Jersey Mill for up to 60 days, until H&H provides shipping instructions. The Company’s concentrate sales sometimes involve variable consideration, as they can be subject to changes in metals prices between the time of shipment and their final settlement. However, the Company can reasonably estimate the transaction price for the concentrate sales at the time of shipment using forward prices for the estimated month of settlement, and previously recorded sales and accounts receivable are adjusted to estimated settlement metals prices until final settlement for financial reporting purposes. The embedded derivative contained in concentrate sales is adjusted to fair value through earnings each period prior to final settlement. It is unlikely a significant reversal of revenue for any one concentrate lot will occur. As such, the Company uses the expected value method to price the concentrate until the final settlement date occurs, at which time the final transaction price is known. At December 31, 2024, metals that had been sold but not final settled included 6,466 ounces of gold of which 1,283 ounces were sold at a predetermined price with the remaining 5,183 ounces exposed to future price changes until prices are locked in based on the month of settlement. The Company has received provisional payments on the sale of these ounces with the remaining amount due reflected in gold sales receivable. Sales and accounts receivable for concentrate shipments are recorded net of charges for treatment and other charges negotiated by us with H&H, which represent components of the transaction price. Charges are estimated by the Company upon transfer of risk of the concentrates based on contractual terms, and actual charges typically do not vary materially from estimates. Costs charged by the customer include fixed treatment, refining and costs per ton of concentrate and may include penalty charges for lead and zinc content above a negotiated baseline as well as excessive moisture. For sales of doré and of metals from doré, the performance obligation is met, the transaction price is known, and revenue is recognized at the time of transfer of control of the agreed-upon metal quantities to the customer. Sales of products by metal for the years ended December 31, 2024 and 2023 were as follows: 2024 2023 Gold $ 26,406,937 $ 14,308,098 Silver 121,882 55,747 Less: Smelter and refining charges ( 763,446 ) ( 707,112 ) Total $ 25,765,373 $ 13,656,733 Sales by significant product type for the years ended December 31, 2024 and 2023 were as follows: 2024 2023 Concentrate sales to H&H $ 25,492,380 $ 13,518,628 Doré sales to refineries 272,993 138,105 Total $ 25,765,373 $ 13,656,733 In 2024 and 2023, flotation concentrates sold to H&H accounted for 99% of all gold sales. The remaining 1 % was doré sold to a third party. At December 31, 2024 and 2023, the Company’s gold sales receivable balance related to contracts with customers of $ 1,578,694 and $ 1,038,867 , respectively, consist only of amounts due from H&H. There is no allowance for doubtful accounts. The Company has determined its contracts do not include a significant financing component. For doré sales, payment is received at the time the performance obligation is satisfied. Consideration for concentrate sales is variable, and payment is received for a significant portion of the estimated value of concentrate parcels at the time the performance obligation is satisfied. F-17 Table of Contents Idaho Strategic Resources, Inc. Notes to Consolidated Financial Statements 14. Investments in US Treasury Notes The table below provides the components of investments in US Treasury notes held to maturity at amortized cost and fair value at December 31, 2024 and 2023. December 31, 2024 Amortized Cost Gross Unrealized gains Gross Unrealized losses Fair value US Treasury notes, current $ 7,775,193 $ 30,807 $ - $ 7,806,000 US Treasury notes, non-current $ 7,208,930 $ 72,070 $ - $ 7,281,000 Total $ 14,984,123 $ 102,877 $ - $ 15,087,000 December 31, 2023 US Treasury notes, current $ - $ - $ - $ - US Treasury notes, non-current $ - $ - $ - - Fair value of investments in US Treasury notes is determined using Level 1 inputs. The maturity dates for the US Treasury notes as of December 31, 2024 are as follows: Maturity Amortized Cost Due within one year $ 7,775,193 Due one year to five years $ 7,208,930 Total $ 14,984,123 15. Subsequent Events On January 15, 2025, the Company granted 400,000 stock options to employees with an exercise price of $11.50. These options expire on January 15, 2028, and vest equally on June 30, 2025, December 31, 2025, June 30, 2026 and December 31, 2026. F-18 Table of Contents ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE None.