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Item 8. Financial Statements and Supplementary Data

2022-03-28 compared with 2021-03-10 · 1421 added, 1017 removed, 390 unchanged (86% of the section changed)

Financial Statements and Supplementary Data

ITEM 8 FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

CONSOLIDATED FINANCIAL STATEMENTS

DECEMBER 31, 2021 AND 2020

Reports of Independent Registered Public Accounting Firms

Report of Independent Registered Public Accounting Firm ( Assure CPA, LLP , Spokane, WA , PCAOB ID:

Consolidated Balance Sheets

Consolidated Statements of Operations

Consolidated Statements of Changes in Equity

Consolidated Statements of Changes in Stockholders' Equity

Consolidated Statements of Cash Flows

1 unchanged sentence

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To the Board of Directors and Stockholders of Comstock Mining Inc.

To the Board of Directors and Stockholders

Comstock Mining Inc.

Opinion on the Financial Statements

We have audited the accompanying consolidated balance sheet of Comstock Mining Inc.

and subsidiaries (“the Company”) as of December 31, 2020 and the related consolidated statements of operations, changes in equity and cash flows for the year 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, 2020 and the results of its operations and its cash flows for the year then ended, in conformity with accounting principles generally accepted in the United States of America.

We have audited the accompanying consolidated balance sheets of Comstock Mining Inc.

(“the Company”) as of December 31, 2021 and 2020, and the related consolidated statements of operations, of changes in stockholders’ equity and of cash flows for the years then ended, and the related notes (collectively referred to as the “consolidated financial statements”).

In our opinion, the consolidated financial statements present fairly, in all material respects, the financial position of the Company as of December 31, 2021 and 2020, and the results of its operations and its cash flows for 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 audit.

These consolidated financial statements are the responsibility of the Company’s management.

Our responsibility is to express an opinion on the Company’s consolidated 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 audit in accordance with the standards of the PCAOB.

Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud.

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 consolidated financial statements are free of material misstatement, whether due to error or fraud.

The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting.

As part of our audit, we are required to obtain an understanding of internal control over financial reporting, but not for the purpose of expressing an opinion on the effectiveness of the Company’s internal control over financial reporting.

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 audit included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks.

Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements.

Our audit also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements.

We believe that our audit provides a reasonable basis for our opinion.

Our audits included performing procedures to assess the risks of material misstatement of the consolidated 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 consolidated 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 consolidated financial statements.

We believe that our audits provide a reasonable basis for our opinion.

Critical Audit Matters

The critical audit matter communicated below is a matter arising from the current-period audit of the financial statements that was communicated or required to be communicated to the audit committee and that (1) relates to accounts or disclosures that are material to the financial statements and (2) involved our especially challenging, subjective, or complex judgments.

The communication of critical audit matters does not alter in any way our opinion on the financial statements, taken as a whole, and we are not, by communicating the critical audit matter below, providing a separate opinion on the critical audit matter or on the accounts or disclosures to which it relates.

Fair Value Measurements associated with the sale of the Company’s subsidiary to Tonogold Resources, Inc.

– Refer to Note 2 and Note 15 to the financial statements.

Business Combinations and Asset Acquisition– Refer to Notes 2 and 15 to the consolidated financial statements

Critical Audit Matter Description

The Company’s sale of a subsidiary as described in Note 2 to the consolidated financial statements under the heading Tonogold Resources Inc.

Securities, Purchase, Lease and Option Agreements contained convertible preferred shares, a contingent forward asset, and a convertible note receivable, all of which are financial instruments subject to fair value measurements during the year ended December 31, 2020.

Under accounting principles generally accepted in the United States of America, these specific financial instruments are classified as Level 3 in the fair value hierarchy.

Unlike the fair value of other assets and liabilities that are readily observable, the valuation of these financial instruments classified as Level 3 was inherently subjective and involved the use of complex valuation models and unobservable inputs.

Note 15 to the financial statements describes the valuation models and various inputs used for each of these financial instruments.

We identified the valuation of these financial instruments as a critical audit matter because of the complex valuation models and unobservable inputs management used to estimate fair value, which required a high degree of auditor judgment and an increased extent of effort.

The Company had various business combinations and an asset acquisition transaction in 2021.

The purchase price associated with these transactions was allocated to the assets acquired and liabilities assumed, in each case based on estimates of their respective fair values at the acquisition dates.

Assets acquired included developed technology intangible assets totaling approximately $18.3 million.

In addition, consideration paid in certain of the acquisitions included shares of the Company’s common stock that contained provisions restricting the holder’s ability to transfer or sell the shares for a period of time.

Such shares had an estimated fair value on the acquisition dates totaling approximately $31.0 million.

Fair values of the developed technologies and restricted shares were estimated by the Company with the assistance of its third-party specialists.

Management exercised significant judgment to select the valuation methods;

to select appropriate inputs and

and to develop assumptions used in the measurement of the fair value.

Certain assumptions were forward-looking and could be affected by future economic and market conditions.

We identified the assessment of the acquisition-date fair value of developed technologies and restricted stock as a critical audit matter.

The principal considerations for our determination included the use of the following:

(i) significant assumptions, (ii) significant unobservable inputs, and (iii) the use of valuation models.

Auditing these elements involved especially subjective auditor judgment due to the nature and extent of audit effort required to address these matters, including the extent of specialized skill or knowledge needed.

The revenue growth rates and the discount rate used to determine the fair value of the developed technologies were challenging to evaluate as there was limited observable market information and minor changes to those assumptions could have a significant effect on the acquisition-date fair value of the intangible asset.

How the Critical Audit Matter was Addressed in the Audit

Our audit procedures related to valuation models and unobservable inputs used by management to estimate the fair value of the financial instruments described above included the evaluation and assessment of the following, among others:

• Management’s process for determining the fair value of the financial instruments, including an evaluation of the methodologies used and the appropriateness of significant inputs (e.g., the discount and default rates) and of key probability factors (e.g., redemption, conversion, prepayment, and maturity date extension).

• The consistency by which management applied significant unobservable valuation assumptions and utilized particular valuation models.

• The competence, capabilities, and objectivity of the valuation specialist that management engaged to assist in the development of significant assumptions and to calculate the fair value by applying selected valuation models.

• The reasonableness of inputs for discount and defaults rates which included comparison to rate ranges developed using publicly available market data for comparable entities and other industry factors.

• The reasonableness of the basis of management’s determination of probability factors including whether assumptions were consistent with evidence obtained in other areas of the audit and consideration of contrary information.

We performed to following to address the critical audit matter:

Obtained an understanding of management’s process related to the determination of the fair value of acquired intangible assets and restricted stock issued, including the related revenue growth rates and the discount rates.

With the assistance of third-party valuation specialists, we:

tested the completeness, accuracy and relevance of underlying data used in the analysis;

assessed the reasonableness of significant underlying assumptions which included:

(i) comparing to historical information and available market data and (ii) comparing prospective financial information to current industry trends;

Assessed the appropriateness of various valuation models utilized by management to determine the fair values of the assets acquired;

Performed sensitivity analyses around significant assumptions that affect projected cash flows.

/s/Assure CPA, LLC

We have served as the Company’s auditor since 2020.

Spokane, Washington

March 28, 2022

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To the Stockholders and the Board of Directors of Comstock Mining Inc.

Opinion on the Financial Statements

We have audited the accompanying consolidated balance sheet of Comstock Mining Inc.

and subsidiaries (the "Company") as of December 31, 2019, the related consolidated statements of operations, changes in stockholders' equity, and cash flows for the year 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, 2019, and the results of its operations and its cash flows for the year then ended, in conformity with accounting principles generally accepted in the United States of America.

Going Concern

The accompanying financial statements have been prepared assuming that the Company will continue as a going concern.

As discussed in Note 1 to the financial statements, the Company has incurred recurring losses and cash outflows from operations, has an accumulated deficit and has debt maturing within twelve months from the issuance date of the financial statements that raise substantial doubt about its ability to continue as a going concern.

Management's plans in regard to these matters are also described in Note 1.

The financial statements do not include any adjustments that might result from the outcome of this uncertainty.

Basis for Opinion

These financial statements are the responsibility of the Company's management.

Our responsibility is to express an opinion on the Company's financial statements based on our audit.

federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

We conducted our audit in accordance with the standards of the PCAOB.

Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud.

The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting.

As part of our audit, we are required to obtain an understanding of internal control over financial reporting but not for the purpose of expressing an opinion on the effectiveness of the Company’s internal control over financial reporting.

Accordingly, we express no such opinion.

Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements.

Our audit also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements.

We believe that our audit provides a reasonable basis for our opinion.

/s/ Deloitte & Touche LLP

Salt Lake City, Utah

March 30, 2020

We began serving as the Company’s auditor in 2011.

In 2020 we became the predecessor auditor.

We have served as the Company’s auditor since 2020.

COMSTOCK MINING INC.

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CONSOLIDATED BALANCE SHEETS

DECEMBER 31, 2020 AND 2019

December 31, 2020 December 31, 2019

AS OF DECEMBER 31, 2021 AND 2020

12/31/21 12/31/20

Current Assets:

Cash and cash equivalents $ 5,912,188 $ 2,431,944

Assets held for sale (Note 4) 6,328,338 10,512,066

Investments in equity securities (Note 15) 3,979,723 —

Notes receivable and advances, net - current portion (Note 3) 7,148,500 —

Derivative asset related to Mercury Clean Up, LLC (Note 2) 265,127 —

Prepaid expenses and other current assets (Note 5) 681,078 1,821,627

Assets held for sale — 6,328,338

Investments in equity securities 925,819 3,979,723

Notes receivable and advances, net - current portion 4,964,545 7,148,500

Derivative assets 342,000 265,127

Deposits, current portion 347,454 145,600

Prepaid expenses and other current assets 1,336,983 535,478

Total current assets 13,828,989 20,834,710

Mineral rights and properties, net (Note 6) 5,790,885 5,690,885

Properties, plant and equipment, net (Note 7) 9,431,459 7,935,021

Reclamation bond deposit (Note 8) 2,695,704 2,688,962

Retirement obligation asset (Note 12) 57,963 115,926

Investment in Tonogold Resources, Inc.

preferred shares (Note 2) — 9,080,000

Investment in Mercury Clean Up, LLC (Note 2) 2,010,113 —

Investment in MCU Philippines, Inc (Note 2) 323,770 —

Investment in Pelen Limited Liability Company (Note 2) 603,714 —

Investment in Sierra Springs Opportunity Fund, Inc.

(Note 2) 335,000 335,000

Notes receivable and advances, net (Note 3) 860,940 —

Investments 25,850,879 3,272,597

Mineral rights and properties 6,669,111 6,597,644

Properties, plant and equipment, net 14,563,672 8,624,700

Reclamation bond deposit 2,695,944 2,695,704

Retirement obligation asset — 57,963

Notes receivable and advances, net 8,853,841 860,940

Intangible assets, net 23,175,301 —

Goodwill 12,788,671 —

Finance lease - right of use asset, net 15,033,000 —

Deposits 3,219,607 —

Other assets 275,617 179,304

Total noncurrent assets 113,125,643 22,288,852

TOTAL ASSETS $ 126,954,632 $ 43,123,562

2 unchanged sentences

Accounts payable $ 633,223 $ 313,772

Accrued expenses and other liabilities (Note 9) 534,947 1,855,431

Accrued expenses and other liabilities 939,443 534,947

Deposits 420,183 419,266

Liabilities held for sale, net (Note 4) — 1,019,705

Long-term debt, net - current portion (Note 11) 3,557,705 328,068

Derivative liabilities 8,873,162 —

Finance lease - right of use lease liability 13,043,499 —

Debt — 3,557,705

Total current liabilities 23,909,510 4,825,690

Long-term Liabilities:

Long-term debt, net (Note 11) — 5,084,006

Long-term reclamation liability (Note 12) 6,054,919 6,034,208

Other liabilities (Notes 9 and 10) 463,747 514,977

Reclamation liability 5,445,672 6,054,919

Debt, net 4,486,256 —

Other liabilities 142,672 463,747

Total long-term liabilities 10,074,600 6,518,666

Total liabilities 33,984,110 11,344,356

COMMITMENTS AND CONTINGENCIES (Note 13)

COMMITMENTS AND CONTINGENCIES

Stockholders' Equity

Preferred Stock $ .000666 par value, 50,000,000 shares authorized, no shares outstanding

Common stock, $ .000666 par value, 158,000,000 shares authorized,

34,980,766 and 27,236,489 shares issued and outstanding at

Common stock, $ .000666 par value, 158,000,000 shares authorized, 71,207,832 and 34,980,766 shares issued and outstanding at

December 31, 2021 and 2020, respectively

47,065 22,937

Treasury stock ( 3,870,000 ) —

Additional paid-in capital 338,936,145 252,715,337

Accumulated deficit ( 245,542,688 ) ( 220,959,068 )

Total Comstock Mining Inc.

stockholders' equity 31,779,206 23,223,019

Noncontrolling interest — 269,541

Total equity 89,570,522 31,779,206

TOTAL LIABILITIES AND EQUITY $ 43,123,562 $ 39,569,892

See notes to the consolidated financial statements.

Non-controlling interest 3,400,000 —

Total stockholders' equity - Comstock Mining Inc.

92,970,522 31,779,206

TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY $ 126,954,632 $ 43,123,562

The accompanying notes to the Consolidated Financial Statements are an integral part of these statements .

COMSTOCK MINING INC.

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CONSOLIDATED STATEMENTS OF OPERATIONS

YEARS ENDED DECEMBER 31, 2020 AND 2019

Revenue - mining $ — $ —

Revenue - real estate 201,700 179,632

Total revenues

201,700 179,632

COST AND EXPENSES

Costs applicable to mining 218,252 1,498,672

Real estate operating costs 802,307 37,562

Exploration and pre-development costs 835,202 750,647

Mine claims and costs 135,859 174,173

Environmental and reclamation 132,541 ( 244,164 )

General and administrative 3,551,800 3,307,195

Total cost and expenses

FOR THE YEARS ENDED DECEMBER 31, 2021 AND 2020

12/31/21 12/31/20

Revenue $ 862,165 $ 201,700

Cost of goods sold 272,082 51,890

Gross profit 590,083 149,810

Operating expenses:

Selling, general and administrative expenses 5,546,767 4,401,633

Research and development 414,751 —

Depreciation and amortization 1,034,486 1,222,438

Total operating expenses 6,996,004 5,624,071

Loss from operations ( 6,405,921 ) ( 5,474,261 )

Other Income (Expense)

Gain (loss) on investments ( 2,244,951 ) 3,152,702

Gain on sale of membership interests in Comstock Mining, LLC — 18,275,846

Change in estimated fair value of contingent forward asset — 765,880

Interest expense ( 168,881 ) ( 421,887 )

Interest income 1,017,947 473,681

Change in fair value of derivative instruments ( 13,155,946 ) 427,838

Impairment of goodwill and intangible assets ( 6,394,610 ) —

Other income (expense) ( 2,979,363 ) ( 2,267,829 )

Total other income (expense), net ( 23,925,804 ) 20,406,231

20,406,231 1,538,586

Net income (loss) before deferred income tax benefit ( 30,331,725 ) 14,931,970

Deferred income tax benefit 5,748,105 —

Net income (loss) $ ( 24,583,620 ) $ 14,931,970

net loss attributable to noncontrolling interest — ( 765 )

NET INCOME (LOSS) ATTRIBUTABLE TO COMSTOCK MINING INC.

$ 14,931,970 $ ( 3,805,102 )

Basic income (loss) per common share:

Net income (loss) per share $ 0.49 $ ( 0.20 )

Weighted average common shares outstanding 30,526,895 19,455,505

Diluted income (loss) per share:

Net income (loss) per common share $ 0.49 $ ( 0.20 )

Weighted average common shares outstanding 30,561,168 19,455,505

See notes to the consolidated financial statements.

Weighted average common shares outstanding, basic 50,417,979 30,526,895

Weighted average common shares outstanding, diluted 50,417,979 30,561,168

Earnings per Share - Basic:

Net income (loss) per share - basic $ ( 0.49 ) $ 0.49

Earnings per Share - Diluted:

Net income (loss) per share - diluted $ ( 0.49 ) $ 0.49

The accompanying notes to the Consolidated Financial Statements are an integral part of these statements .

COMSTOCK MINING INC.

AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY

YEARS ENDED DECEMBER 31, 2020 AND 2019

Comstock Mining Inc.

Preferred Stock Common Stock Additional Paid-in Capital Accumulated

Deficit Non-controlling Interest

Shares Amount Shares Amount Amount Amount Amount Total

BALANCE - January 1, 2019 $ — 15,067,655 $ 50,175 $ 241,419,897 $ ( 232,085,170 ) $ 9,384,902

Share reverse split adjustment ( 67,650 ) 67,650 —

Issuance of common stock 8,282,124 22,671 4,455,792 4,478,463

Issuance of common stock for convertible preferred 2,240,441 7,461 1,266,539 1,274,000

Common stock issuance cost — — ( 645,751 ) ( 645,751 )

Issuance of convertible preferred stock 1,083 1 1,082,999 1,083,000

Preferred stock issuance costs 191 432,000 432,000

Preferred stock converted to common ( 1,274 ) ( 1 ) ( 1,273,999 ) ( 1,274,000 )

Payment for mineral rights 746,269 2,485 480,015 482,500

Investment in Mercury Clean Up, LLC 900,000 2,997 748,053 751,050

Termination of share option with Tonogold ( 2,200,000 ) ( 2,200,000 )

Noncontrolling interest in Comstock Mining LLC 13,261,957 270,306 13,532,263

( 3,805,102 ) ( 765 ) ( 3,805,867 )

CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY

FOR THE YEARS ENDED DECEMBER 31, 2021 AND 2020

Preferred Stock Common Stock Additional Accumulated Treasury Stock Non-Controlling

Shares Amount Shares Amount Paid in Capital Deficit Amount Interest Total

BALANCE - December 31, 2019 — $ — 27,236,489 $ 18,139 $ 259,095,152 $ ( 235,890,272 ) — $ 269,541 $ 23,492,560

5 unchanged sentences

Deposit for investment in Mercury Clean Up, LLC 625,000 416 314,271 314,687

Comstock Mining Inc.

Preferred Stock Common Stock Additional Paid-in Capital Accumulated

Deficit Non-controlling Interest

Shares Amount Shares Amount Amount Amount Amount Total

Director compensation 315,000 210 176,190 176,400

Investment in Pelen LLC 585,000 585,000

Employee share-based compensation 27,849 27,849

Payment for mineral rights 343,058 228 482,272 482,500

Employee and director share-based compensation 27,849 27,849

Payment to Northern Comstock LLC for mineral rights 343,058 228 482,272 482,500

Deconsolidation of Comstock Mining LLC ( 20,499,141 ) ( 766 ) ( 313,854 ) ( 20,813,761 )

2 unchanged sentences

BALANCE - December 31, 2020 — $ — 34,980,766 $ 22,937 $ 252,715,337 $ ( 220,959,068 ) $ — $ — $ 31,779,206

See notes to consolidated financial statements.

Issuance of common stock for cash 9,220,123 6,140 27,393,859 27,399,999

Non-cash issuance of common stock 143,787 97 499,906 500,003

Common stock issuance costs — — ( 1,564,502 ) ( 1,564,502 )

Employee and director share-based compensation — — 463,986 463,986

Repurchase of employee stock options — — ( 247,156 ) ( 247,156 )

Investment in LINICO Corporation 6,500,000 4,329 14,003,833 ( 3,870,000 ) 3,400,000 13,538,162

Acquisition of Renewable Process Solutions 1,000,000 666 2,304,140 2,304,806

Investment in GenMat 3,000,000 1,998 10,528,002 10,530,000

Acquisition of MANA Corporation 4,200,000 2,797 6,525,656 6,528,453

Payment to Northern Comstock LLC for mineral rights 163,156 109 482,391 482,500

Acquisition of Plain Sight Innovations Corporation 8,500,000 5,661 14,947,145 14,952,806

Investment in LP Biosciences LLP 3,500,000 2,331 10,812,669 10,815,000

Warrants associated with debt — — 70,879 — — 70,879

Net loss ( 24,583,620 ) ( 24,583,620 )

BALANCE - December 31, 2021 — $ — 71,207,832 $ 47,065 $ 338,936,145 $ ( 245,542,688 ) $ ( 3,870,000 ) $ 3,400,000 $ 92,970,522

The accompanying notes to the Consolidated Financial Statements are an integral part of these statements .

COMSTOCK MINING INC.

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CONSOLIDATED STATEMENTS OF CASH FLOWS

YEARS ENDED DECEMBER 31, 2020 AND 2019

OPERATING ACTIVITIES:

FOR THE YEARS ENDED DECEMBER 31, 2021 AND 2020

12/31/21 12/31/20

CASH FLOW FROM OPERATING ACTIVITIES

Net income (loss) $ ( 24,583,620 ) $ 14,931,970

1 unchanged sentence

Depreciation, amortization and depletion 522,728 1,217,217

Amortization of intangibles 569,721 —

Accretion (reduction) of reclamation liability ( 609,247 ) 20,711

Amortization of discount on MCU Philippines, Inc.

Accretion of discount on MCU Philippines, Inc.

note receivable ( 107,238 ) ( 5,074 )

Gain on sale of mineral rights and properties, plant, and equipment ( 152,000 ) ( 4,625 )

Cancellation of Tonogold Resources, Inc.

share option — ( 2,200,000 )

Gain on sale of mineral rights and properties — ( 152,000 )

Amortization of debt discount and other debt-related items ( 38,656 ) 240,219

Preferred shares issuance expense — 432,000

Loss on early retirement of long-term debt — 252,486

Employee share based compensation cost 204,249 —

Change in fair value of make whole liabilities ( 261,661 ) 540,179

Unrealized gain on investments in securities ( 1,624,633 ) —

Equity loss from affiliates 2,131 —

Change in fair value of derivative asset ( 265,127 ) —

Realized gain on sale of Tonogold Resources, Inc.

common shares ( 1,528,069 ) —

Employee and director share based compensation 463,986 204,249

Change in fair value of derivatives 13,155,946 ( 526,788 )

Gain on sale of membership interest in Comstock Mining LLC — ( 18,275,846 )

Gain (loss) on investments in securities 2,244,951 ( 3,152,702 )

Loss from equity method investments 2,049,070 2,131

Impairment of goodwill and intangible assets 6,394,610 —

Write off LPB note receivable and deposit 576,258 —

Writedown of uncollectible receivable 300,000 —

Change in fair value of Tonogold Resources, Inc.

convertible preferred shares — 2,544,000

Non-cash Tonogold reimbursements and fees ( 2,175,000 ) —

Change in fair value of Tonogold Resources, Inc.

note receivable 418,500 642,997

Gain on sale of membership interests in Comstock Mining LLC ( 18,275,846 ) —

Change in fair value of contingent forward asset — ( 765,880 )

Gain on final settlement of accounts payable — ( 144,473 )

Impairment of asset held for sale — 496,090

Deferred tax benefit ( 5,748,105 ) —

Changes in operating assets and liabilities:

Prepaid expenses ( 717,822 ) ( 60,501 )

Deposits 479,881 —

Other assets ( 85,817 ) 192,500

1 unchanged sentence

Accrued expenses, other liabilities and deposits 104,456 ( 212,996 )

NET CASH USED IN OPERATING ACTIVITIES ( 3,764,575 ) ( 2,307,174 )

INVESTING ACTIVITIES:

Net cash used by operating activities ( 7,492,402 ) ( 3,764,575 )

CASH FLOW FROM INVESTING ACTIVITIES:

Investments in LINICO Corporation ( 6,025,034 ) —

Investment in Quantum Generative Materials LLC ( 4,250,000 ) —

Investment in Plain Sight Innovations LLC ( 1,875,503 ) —

Investment in Mercury Clean Up, LLC ( 820,000 ) ( 413,093 )

Investment in MCU Philippines, Inc.

( 1,000 ) ( 1,180,000 )

Investment in Pelen LLC — ( 17,500 )

Acquisition-related costs ( 224,948 ) —

Payments to LP Biosciences LLC ( 576,258 ) —

Payments on Pelen LLC option and obligations ( 100,000 ) ( 297,943 )

Advances to Sierra Springs Opportunity Fund, Inc.

( 3,285,000 ) ( 1,650,000 )

12/31/21 12/31/20

Advances to Solid Carbon Products ( 300,000 ) —

Purchase of mineral rights and properties, plant and equipment ( 78,467 ) ( 130,750 )

Proceeds from principal payment on note receivable 9,058 2,795

6 unchanged sentences

convertible preferred shares — 2,616,000

Proceeds from Mercury Clean Up, LLC derivative asset settlement 762,377 —

Payments received on Tonogold Resources, Inc.

note receivable — 900,000

Deposits received on the sale of properties to Sierra Springs Opportunity Fund 100,000 300,000

Purchase of mineral rights and properties, plant and equipment ( 130,750 ) ( 2,436,354 )

Investment in Sierra Springs Opportunity Fund, Inc.

— ( 335,000 )

Advance to Sierra Springs Opportunity Fund, Inc.

( 1,650,000 ) —

Investment in Pelen Limited Liability Company ( 17,500 ) —

Investment in Mercury Clean Up, LLC ( 413,093 ) ( 750,000 )

Investment in MCU Philippines, Inc.

( 1,180,000 ) —

Payment on Pelen Limited Liability Company make whole liability ( 197,943 ) —

Payment for option to purchase additional membership interests in Pelen Limited Liability Company ( 100,000 ) —

Deposits received on the sale of properties to Sierra Springs Opportunity Fund, Inc.

Down payment for Flux Photon Corporation asset acquisition ( 350,000 ) —

Cash acquired in acquisitions 219,217 —

Change in reclamation bond deposit ( 240 ) ( 6,742 )

NET CASH PROVIDED BY INVESTING ACTIVITIES 3,207,696 2,642,249

FINANCING ACTIVITIES:

Net cash provided by (used) in investing activities ( 16,097,485 ) 3,207,696

CASH FLOWS FROM FINANCING ACTIVITIES:

Principal payments on debt ( 3,568,214 ) ( 7,564,586 )

Proceeds from issuance of promissory notes payable 4,550,000 5,470,000

Proceeds from the issuance of common stock 27,399,999 4,197,622

Common stock issuance costs ( 1,064,498 ) ( 130,070 )

Proceeds from the issuance of convertible preferred stock — 1,083,000

Proceeds from issuance of unsecured promissory notes 5,470,000 —

Repurchase of employee stock options ( 247,156 ) —

Net cash provided by financing activities 27,070,131 1,972,966

INCREASE IN CASH AND CASH EQUIVALENTS 1,416,087 527,200

CASH AND CASH EQUIVALENTS, BEGINNING OF YEAR 1,015,857 488,657

CASH AND CASH EQUIVALENTS, END OF YEAR $ 2,431,944 $ 1,015,857

Net increase in cash 3,480,244 1,416,087

Cash at beginning of year 2,431,944 1,015,857

Cash at end of year $ 5,912,188 $ 2,431,944

SUPPLEMENTAL CASH FLOW INFORMATION:

Cash paid for interest (Note 11) $ 783,325 $ 551,087

Cash paid for interest $ 107,499 $ 783,325

Cash paid for income taxes $ — $ —

NON-CASH INVESTING AND FINANCING ACTIVITIES:

Issuance of common shares for Mercury Clean Up, LLC make whole liability (Note 2) $ 314,687 $ —

Investment in Pelen LLC (Note 2) $ 585,000 $ —

Issuance of common stock for acquisitions:

Renewable Process Solutions, Inc.

$ 2,304,806 $ —

MANA Corporation 6,528,453 —

Plain Sight Innovations Corporation 14,952,806 —

LINICO Corporation 7,255,831 —

Issuance of common shares for investments:

LINICO Corporation 6,250,000 —

Quantum Generative Materials LLC 10,000,000 —

LP Biosciences LLC 4,173,000 —

Issuance of common shares for derivative assets:

LINICO Corporation 500,000 —

Quantum Generative Materials LLC 530,000 —

LP Biosciences LLC 6,642,000 —

Increase in Tonogold note receivable in exchange for non-cash reimbursements 1,812,500 —

Issuance of common shares for Northern Comstock LLC mineral rights payments 482,500 482,500

Issuance of common shares for stock issuance costs 500,002 125,000

Issuance of common shares for investment in Mercury Clean Up, LLC (Note 2) $ — $ 751,050

Issuance of common shares for mineral rights $ 482,500 $ 482,500

Receipt of Tonogold convertible preferred stock for Comstock Mining LLC sale $ — $ 7,607,263

Asset held for sale transferred to property, plant and equipment 6,328,338 —

Conversion of Tonogold convertible preferred stock to Tonogold common stock — 3,920,000

Receivable related to sale of Tonogold common stock to Wingfield Tono, LP $ 200,000 $ —

See notes to consolidated financial statements.

Issuance of common shares for Mercury Clean Up, LLC make whole liability — 314,687

Investment in Pelen LLC — 585,000

The accompanying notes to the Consolidated Financial Statements are an integral part of these statements .

COMSTOCK MINING INC.

AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

AS OF AND FOR THE YEARS ENDED DECEMBER 31, 2020 AND 2019

Summary of Significant Accounting Policies

Basis of Presentation and Principles of Consolidation

Comstock Mining Inc.

is a Nevada-based, precious and strategic metal-based exploration, economic resource development, mineral production and metal processing business with a strategic focus on high-value, cash-generating, environmentally friendly, and economically enhancing mining and processing technologies and businesses.

The Company has extensive, contiguous property in the historic Comstock and Silver City mining districts (collectively, the “Comstock District”), is an emerging leader in sustainable, responsible mining and processing, and is currently commercializing environment-enhancing, metal-based technologies, products, and processes for precious and strategic metals recovery.

As used in the notes to the consolidated financial statements, we refer to Comstock Mining Inc., and its wholly-owned subsidiaries as "Comstock", the "Company", "we", “us”, or "our."

The consolidated financial statements are prepared in accordance with accounting principles generally accepted in the United States ("GAAP") and include the accounts of Comstock Mining Inc.

and its wholly-owned subsidiaries, Comstock Processing LLC, Comstock Northern Exploration LLC, Comstock Exploration and Development LLC, Comstock Real Estate Inc., Comstock Industrial LLC, Downtown Silver Springs LLC ("DTSS") and, prior to its sale in September 2020, Comstock Mining LLC.

Intercompany transactions and balances have been eliminated.

On September 8, 2020, the Company completed the sale to Tonogold Resources, Inc.

("Tonogold") of its remaining 50 % membership interests in Comstock Mining LLC (“Comstock LLC”).

The consolidated financial statements do not include Comstock LLC subsequent to that date (Note 2).

Variable interest entities (VIEs) are consolidated when the Company is the primary beneficiary.

The Company is the primary beneficiary when it has power over the activities that impact the VIE’s economic performance and, at the same time, has the obligation to absorb losses or the right to receive benefits that could potentially be significant to the VIE.

NOTE 1 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

REFERENCES TO THE COMPANY

Unless context otherwise indicates, the terms we , us , our , Comstock , or the Company mean Comstock Mining Inc., and its subsidiaries on a consolidated basis.

DESCRIPTION OF THE BUSINESS

Comstock innovates technologies that contribute to global decarbonization and circularity by efficiently converting massive supplies of under-utilized natural resources into renewable fuels and electrification products that contribute to balancing global uses and emissions of carbon .

We intend to use our technologies to build, own, and operate a fleet of advanced carbon neutral extraction and refining facilities, to sell of complimentary process solutions and related services, and to provide license rights to qualified strategic partners.

Our strategic plan is based on innovating and using our technologies and the renewable energy products that they enable to reduce reliance on long cycle fossil fuels, to shift to and maximize throughput of short cycle fuels, and to lead and support the adoption and growth of a highly profitable, balanced worldwide short cycle ecosystem that continuously offsets, recycles, and contributes to neutralizing global carbon emissions by rapidly growing and replenishing vast quantities of feedstock for renewable circular fuels.

We also make strategic and other investments that contribute to our mission of enabling systemic decarbonization and help to realize our vision of a net zero carbon world..

Comstock historically focused on natural resource exploration, development, and production, with an emphasis on mining gold and silver resources from its extensive contiguous property holdings in the historic Comstock and Silver City mining districts in Nevada (collectively, the “Comstock Estate”).

Between 2012 and 2021, we mined and processed about 2.6 million tons of mineralized material from the Comstock Mineral Estate, producing 59,515 ounces of gold and 735,252 ounces of silver.

During 2020 and 2021, we completed a series of transactions that were designed to build on our competencies and position us to address and capitalize on the global transition to clean energy.

Those transactions primarily included (i) our sale of Comstock Mining LLC, the owner of our Lucerne resource area in Storey County, Nevada, and related permits, (ii) our acquisitions of 100 % of Comstock Innovations Corporation (F/K/A Plain Sight Innovations Corporation), 100 % of Comstock Engineering Corporation (F/K/A Renewable Process Solutions, Inc.), 100 % of MANA Corporation, and 90 % of LINICO Corporation, (iii) our acquisition of intellectual property assets from FLUX Photon Corporation, and (iv) our purchase of 48.19 % of Quantum Generative Materials LLC, 25 % of Mercury Clean Up LLC, 50 % of MCU Philippines, Inc.

and 25 % of Pelen Limited Liability Company.

Collectively, these transactions added the management, employees, facilities, intellectual properties, and other assets we needed to restructure and transform our Company and business into an emerging leader in the innovation and sustainable production of renewable energy products, including cellulosic fuels and electrification metals.

Additional information on these transactions is provided in Note 2, Acquisitions and Investments .

CONSOLIDATED FINANCIAL STATEMENTS

The Consolidated Financial Statements herein are prepared in accordance with accounting principles generally accepted in the United States ("GAAP") and include the accounts of Comstock Mining Inc.

and its wholly-owned subsidiaries which include the following:

• Comstock Innovations Corporation (formerly Plain Sight Innovations Corporation) ("Comstock Innovations") since its acquisition in September 2021;

• Comstock Fuels Corporation ("Comstock Fuels");

• Comstock Metals Corporation ("Comstock Metals"), owner of 90 % of LINICO Corporation since its acquisition on December 30, 2021, fully included 100 % in the consolidated financial statements ;

• Comstock Engineering Corporation (formerly Renewable Process Solutions, Inc.) ("Comstock Engineering") since its acquisition in June 2021;

• Comstock IP Holdings LLC (formerly Plain Sight Innovations LLC) (“Comstock IP Holdings”), since its acquisition in September 2021;

• Comstock Royalty Holdings LLC (“CRH”);

• Comstock Exploration and Development LLC (“CED”);

• Comstock Northern Exploration LLC (“CNE”);

• Comstock Processing LLC (“CP”);

• Comstock Real Estate, Inc.

• Downtown Silver Springs LLC (“DTSS”);

• Comstock Industrial LLC (“CI”);and

• MANA Corporation, since its acquisition in July 2021;

All significant intercompany balances and transactions have been eliminated on a consolidated basis for reporting purposes.

SEGMENT INFORMATION

We evaluate a reporting unit by first identifying its operating segments.

The chief operating decision maker ("CODM") over the segments is the Executive Management Committee.

We then evaluate each operating segment to determine if it includes one or more components that constitute a business.

If there are components within an operating segment that meet the definition of a business, we evaluate those components to determine if they must be aggregated into one or more reporting units.

If applicable, when determining if it is appropriate to aggregate different operating segments, we determine if the segments are economically similar and, if so, the operating segments are aggregated.

We have the following two segments and reporting units:

production and sale of renewable energy products and strategic and other investments.

While sales for our renewable energy products segment have just commenced with certain engineering services sales, we organize and operate each segment as a distinct business.

Our renewable energy products segment will sell biomass-derived carbon neutral oil, ethanol, gasoline, renewable diesel, jet fuel, marine fuel, and other renewable replacements for long cycle fossil derivatives, intermediates and precursors thereto, and derivatives thereof;

lithium, graphite, nickel, cobalt, copper, aluminum, and other metals, as well as derivative electrification products extracted from lithium ion batteries and other residues produced throughout the electrification supply chain;

an array of design, engineering, fabrication, procurement, and construction solutions;

and, rights to selected technologies to qualified, third-party licensees in exchange for license and royalty fees.

Our strategic and other investments segment includes all other activities, including real estate, mining and our equity method investments, which will generate gains based on the extent to which we are successful in selling or otherwise monetizing invested assets for amounts which exceed our cost basis.

Each segment will likewise have a distinct cost structure with dedicated management personnel with reporting responsibility to the Company’s senior management team.

The Company accumulates discrete financial information for each segment, for review as distinct operating segments, using financial and other information rendered meaningful only by the fact that such information is presented and reviewed on a segment specific basis.

Discrete financial information is available for each operating segment (See Note 20, Segment Reporting ).

BUSINESS COMBINATIONS

The Company applies the acquisition method of accounting for business combinations to all acquisitions where the Company gains a controlling interest, regardless of whether consideration was exchanged.

With respect to business combinations, the Company (a) recognizes and measures the identifiable assets acquired, the liabilities assumed, and any non-controlling interest in the acquiree;

(b) recognizes and measures the goodwill acquired in the business combination or a gain from a bargain purchase;

and, (c) discloses the nature and financial effects of the business combination.

Accounting for acquisitions requires us to recognize, separately from goodwill, the assets acquired and the liabilities assumed at their acquisition-date fair values.

Goodwill as of the acquisition date is measured as the excess of the fair value of consideration transferred and the net acquisition-date fair values of the assets acquired and liabilities assumed.

While the Company uses our best estimates and assumptions to accurately value assets acquired and liabilities assumed at the acquisition date, the estimates inherently are uncertain and subject to refinement.

As a result, during the measurement period, which may be up to one year from the acquisition date, the Company may record adjustments to the assets, including intangible assets acquired and liabilities assumed with corresponding offsets to goodwill.

Upon the conclusion of the measurement period or final determination of the values of

assets acquired and liabilities assumed, whichever comes first, any subsequent adjustments are recorded to our consolidated statements of operations.

Deferred tax liabilities (“DTLs”) created in business combinations for the difference between the historical carryover basis of assets for tax purposes and the stepped-up fair value basis for book purposes are recognized as an increase to goodwill.

ASSET ACQUISITIONS

The cost of a group of assets acquired in an asset acquisition includes the carrying amount of any previously held equity interest, the fair value of any noncontrolling interests, and the fair value of any consideration transferred at the date of acquisition.

The cost is allocated to the individual assets acquired or liabilities assumed based on their relative fair values and goodwill is not recognized.

If it is determined that the cost of the acquisition exceeds the fair value of the assets acquired, the difference is allocated pro rata on the basis of relative fair values to increase certain of the assets acquired.

All identifiable assets, including intangible assets, are identified and recognized.

DTLs created in asset acquisitions for the difference between the historical carryover basis for tax purposes and the stepped-up fair value basis for book purposes are calculated using a simultaneous equation under the gross up approach and recognized as an increase to the assets to which they relate.

VARIABLE INTEREST ENTITIES

A variable interest entity (“VIE”) refers to a legal business structure wherein an investor has a controlling interest despite not having a majority of voting rights, including when the entity invested in is thinly capitalized and its equity is not sufficient to fund its activities without additional subordinated financial support.

An investor in a VIE has a controlling interest if the investor is determined to be the primary beneficiary of the VIE, defined as having the (i) power to direct the activities of the VIE that most significantly impact the VIE’s economic performance, or (ii) obligation to absorb losses of the VIE that could potentially be significant to the VIE, or (iii) right to receive benefits from the VIE that could be significant to the VIE.

The Company has investments in Quantum Generative Materials LLC (“GenMat”) and Sierra Springs Opportunity Fund, Inc.

(“SSOF”), that the Company has determined to be VIEs.

The Company has also determined that the Company does not have a controlling interest in any of these companies, as the Company does not meet the definition of primary beneficiary cited above.

Accordingly, the accounts of these companies are not included in our Consolidated Financial Statements.

The Company has an investment in Sierra Springs Opportunity Fund, Inc.

(“SSOF”), of which the Company's CEO is an executive (Note 2).

(“SSOF”), of which the Company's CEO is an executive (see Note 2, Acquisitions and Investments ).

Management concluded that SSOF is a VIE of the Company because the Company has both operational and equity risk related to SSOF, and SSOF currently has insufficient equity at risk.

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As the Company is not the primary beneficiary, SSOF is not consolidated.

At December 31, 2020 and 2019, the Company’s investment in SSOF is presented on the consolidated balance sheets as a non-current investment.

At December 31, 2020, the Company’s maximum exposure to loss as a result of its involvement with SSOF is limited to its investment of $ 0.4 million and the advances of $ 1.65 million.

Reclassifications

Certain prior year amounts have been reclassified to conform to the 2020 financial statement presentation.

Reclassifications had no effect on net income (loss), stockholders' equity, or cash flows as previously reported.

At December 31, 2021 and December 31, 2020, the Company’s investment in SSOF is presented on the consolidated balance sheets as a non-current investment.

At December 31, 2021, the Company’s maximum exposure to loss as a result of its involvement with SSOF is limited to its investment of $ 335,000 and the advances of $ 4,935,000 .

LIQUIDITY AND CAPITAL RESOURCES

The consolidated financial statements are prepared on the going concern basis of accounting, which assumes the realization of assets and the satisfaction of liabilities in the ordinary course of business.

The Company has recurring net losses from operations and an accumulated deficit of $ 221.0 million as of December 31, 2020.

As of December 31, 2020, the Company has cash and cash equivalents of $ 2.4 million and $ 13.6 million of other net working capital.

During 2021, management expects proceeds from planned sales of Tonogold common shares, collection of a note receivable due on September 20, 2021 from Tonogold, and the planned sale of the Company’s Silver Springs properties (the "Silver Springs Properties") to Sierra Springs Enterprises, Inc.

Management believes the Company will be able to pay its obligations that are due over the next twelve months from the issuance date of the financial statements.

The Consolidated Financial Statements are prepared on the going concern basis of accounting that assumes the realization of assets and the satisfaction of liabilities in the ordinary course of business.

The Company has had recurring net losses from operations and had an accumulated deficit of $ 245.5 million at December 31, 2021.

For the year ended December 31, 2021, the Company recognized a net loss of $ 24.6 million and cash and cash equivalents increased by $ 3.5 million from $ 2.4 million at December 31, 2020 to $ 5.9 million at December 31, 2021.

The Company intends to fund our operations over the next twelve months from (i) existing cash and cash equivalents, (ii) sales of engineering services and technology licenses (iii) the repayment of advances from SSOF, (iv) planned sales of Tonogold Resources, Inc.

("Tonogold") common shares and other Tonogold reimbursements and (v) sales of equity securities.

Based on these expected funding sources, management believes the Company will have sufficient funds to sustain our operations and meet our commitments under our investment agreements during the 12 months following the date of issuance of the Consolidated Financial Statements included herein.

While the Company has been successful in the past in obtaining the necessary capital to support our operations, including registered equity financings from our existing shelf registration statement, borrowings and other means, there is no assurance the Company will be able to obtain additional equity capital or other financing, if needed.

Risks to our liquidity include future operating expenditures above management’s expectations, including but not limited to exploration, pre-development, research and development, selling, general and administrative, and investment related expenditures in excess of planned proceeds from the sale of Tonogold securities, repayment of advances to SSOF, the sale of the Silver Springs Properties, and amounts to be raised from the issuance of equity under our existing shelf registration statement.

Declines in the market value of properties held for sale, or declines in the share price of our common stock would also adversely affect our results of operations, financial condition and cash flows.

If the Company is unable to obtain any necessary additional funds, this could have an immediate material adverse effect on liquidity and raise substantial doubt about our ability to continue as a going concern.

In such case, the Company could be

required to limit or discontinue certain business plans, activities or operations, reduce or delay certain capital expenditures or investments, or sell certain assets or businesses.

There can be no assurance that the Company would be able to take any such actions on favorable terms, in a timely manner, or at all.

USE OF ESTIMATES

In preparing financial statements in conformity with GAAP, we are required to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements, and related income, costs, expenses, receipts

and expenditures during the reported periods.

In preparing GAAP financial statements, the Company is required to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements, and related income, costs, expenses, receipts and expenditures during the reported periods.

Actual results could differ materially from those estimates.

Estimates may include those pertaining to the useful lives and valuation of properties, plant and equipment, carrying value of assets held for sale and, mineral rights, deferred tax assets, derivative assets and liabilities, the Tonogold Series D Convertible Junior Participating Non-Cumulative Perpetual Preferred Stock ("CPS"), note receivable accounted for at fair value, discount rates on non-interest bearing notes, reclamation liabilities, stock-based compensation, and contingent liabilities.

Estimates may pertain to:

• impairment of equity investments;

• notes receivable accounted for at fair value or amortized cost;

• discount rates on non-interest bearing notes receivable;

• derivative assets and liabilities;

• the useful lives and valuation of properties, plant and equipment;

• carrying values of assets held for sale and mineral rights;

• realization of net deferred tax assets;

• fair values of net assets acquired;

• useful lives of intangible assets;

• impairment of intangibles and goodwill;

• reclamation liabilities;

• contingent liabilities;

• revenue contract progress toward completion

• stock-based compensation;

• restricted stock.

CASH, CASH EQUIVALENTS

Cash and cash equivalents include bank deposits and highly liquid investments purchased with maturities of three months or less.

Cash deposits with banks may exceed Federal Deposit Insurance Corporation insured limits.

At December 31, 2021, the Company held $ 500,000 in an escrow account related to our investment in LPB and classified as restricted cash.

This amount was written off at year-end (see Note 2, Acquisitions and Investments , and Note 22, Subsequent Events ).

RECEIVABLES AND CREDIT CONCENTRATION

Accounts receivable are uncollateralized, non-interest-bearing customer obligations due under normal trade terms requiring payment within 30 days from the invoice date.

Accounts receivable are stated at the amount billed to the customer.

Accounts receivable in excess of 90 days old are evaluated for delinquency.

In addition, we consider historical bad debts and current economic trends in evaluating the allowance for doubtful accounts.

Payments of accounts receivable are allocated to the specific invoices identified on the customer’s remittance advice or, if unspecified, are applied to the oldest unpaid invoices.

Management reviews valuation allowances on a quarterly basis.

Investments in Debt and Equity Securities

From time to time, the Company holds investments in the form of debt securities and other instruments, and equity securities.

Investments in debt are classified as trading, available for sale or held to maturity.

In certain cases we elect to record the investment under the fair value option.

Upon sale of a debt security, the realized gain or loss is recognized in current earnings.

At the end of each reporting period, the Company considers whether impairment indicators exist to evaluate if a debt investment security or loan is impaired and, if so, record an impairment loss (see Note 2, Acquisitions and Investments , and Note 15, Fair Value Measurements ).

Investments in equity securities are generally measured at fair value.

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, the Company 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, the Company reassesses 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.

Investments in Joint Ventures and Other Companies

Investments in companies and joint ventures for which the Company has the ability to exercise significant influence, but do not control, are accounted for under the equity method.

Under the equity method of accounting, our share of the net earnings or losses of the investee are included in other income (expense) in the consolidated statements of operations.

Upon investment, the Company assesses whether a step up in the basis of the investee's net assets has occurred and, if so, adjust our share of net earnings or losses by related depreciation and amortization expense.

At the end of each reporting period, the Company considers whether impairment indicators exist to evaluate whether an equity method investment is impaired and, if so, record an impairment loss.

Investments are accounted for on a one-quarter lag.

INTANGIBLE ASSET S

Purchased intangible assets represent the estimated acquisition date fair value of acquired intangible assets used in our business.

Intangible assets with definite lives are amortized over their estimated useful lives.

We amortize definite-lived intangible assets on a straight-line basis, generally over periods ranging from one to ten years .

Costs incurred to renew or extend the life of our intangible assets are capitalized.

We review purchased intangible assets for impairment when events or changes in circumstances indicate that the carrying amount may not be recoverable.

We review indefinite-lived intangibles for impairment annually and more frequently if events or changes in circumstances indicate that it is more likely than not that the asset is impaired.

We measure recoverability of these assets by comparing the carrying amounts to the future undiscounted cash flows that the assets or asset group are expected to generate.

If the carrying value of the assets or asset group are not recoverable, impairment is measured and recorded as the amount by which the carrying value exceeds its fair value.

Goodwill represents the cost in excess of the consideration paid over the fair value of net assets acquired in a business combination.

The Company allocates goodwill to reporting units based on the expected benefit from the business combination.

The Company evaluates our reporting units periodically, as well as when changes in our operating segments occur.

For changes in reporting units, the Company reassigns goodwill using a relative fair value allocation approach.

Goodwill is tested for impairment at the reporting unit level on an annual basis, and on an interim basis if an event occurs or circumstances change that would more likely than not reduce the fair value of a reporting unit below its carrying value.

The Company performs its annual goodwill impairment tests at December 31.

FAIR VALUE MEASUREMENTS

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Categorization within the fair value hierarchy is based on the lowest level of input that is significant to the fair value measurement.

The fair value hierarchy is defined into the following three categories:

Quoted market prices in active markets for identical assets or liabilities.

Observable market-based inputs or unobservable inputs that are corroborated by market data.

Unobservable inputs that are not corroborated by market data.

The fair value hierarchy is as follows:

Level 1 quoted prices (unadjusted) in active markets for identical assets or liabilities that the Company has the ability to access as of the measurement date.

Financial assets and liabilities utilizing Level 1 inputs include active exchange-traded securities and exchange-based derivatives

Level 2 inputs other than quoted prices included within Level 1 that are directly observable for the asset or liability or indirectly observable through corroboration with observable market data.

Financial assets and liabilities utilizing Level 2 inputs include fixed income securities, non-exchange-based derivatives, mutual funds, and fair-value hedges

Level 3 unobservable inputs for the asset or liability only used when there is little, if any, market activity for the asset or liability at the measurement date.

Financial assets and liabilities utilizing Level 3 inputs include infrequently-traded, non-exchange-based derivatives and commingled investment funds, and are measured using present value pricing models

The carrying values of the Company's reclamation bond deposits approximate its fair value.

The carrying values of the Company’s long-term debt approximate their fair values based upon a comparison of the interest rate and terms of such debt to the rates and terms of debt currently available.

DERIVATIVE INSTRUMENTS

Derivative instruments are recognized as either assets or liabilities on the consolidated balance sheets at fair value.

The accounting for changes in the fair value of derivative instruments depends on their intended use and resulting hedge designations.

Changes in the fair value of derivative instruments not designated as hedges are recorded in the consolidated statements of operations as a component of other income (expense).

The accounting for changes in the fair value of derivative instruments depends on their intended use.

Changes in the fair value of derivative instruments are recorded in current earnings.

The Company evaluates and accounts for embedded derivatives in its financial instruments based on three criteria that, if met, require bifurcation of embedded derivatives from their host instruments and accounting for them as free standing derivative financial instruments.

These three criteria include circumstances in which (a) the economic characteristics and risks of the embedded derivative instrument are not clearly and closely related to the economic characteristics and risks of the host contract, (b) the hybrid instrument that embodies both the embedded derivative instrument and the host contract is not required to be re-measured at fair value and (c) a separate instrument with the same terms as the embedded derivative instrument would be considered a derivative instrument.

The result of this accounting treatment could be that the fair value of a financial instrument is classified as a derivative financial instrument, and is shown at its fair value at each balance sheet date and recorded as an asset or liability with the change in fair value recorded in the consolidated statements of operations as other income (expense).

Cash and Cash Equivalents

Cash and cash equivalents include bank deposits and highly liquid investments purchased with maturities of three months or less.

Cash deposits with banks may exceed FDIC insured limits.

Investments in Securities:

From time to time, the Company holds investments in the form of both debt and equity securities.

Debt and convertible debt securities are classified as trading, available for sale or held to maturity, in certain cases electing the fair value option.

Upon sale of a debt security, the realized gain or loss is recognized in earnings.

At December 31, 2020, the Company is the holder of two investments in debt securities, a convertible note receivable from Tonogold and a note receivable from MCU Philippines, Inc ("MCU-P").

The Company has elected the fair value option for the Tonogold note receivable with unrealized gains and losses recognized in current earnings.

The MCU-P note receivable is classified as held to maturity and accounted for at amortized cost (Note 2).

Unrealized gains and losses from available for sale debt securities are excluded from current earnings and reported in other comprehensive income until realized.

Equity securities are generally measured at fair value.

Unrealized gains and losses for equity securities are included in earnings.

At the end of each reporting period, the Company reassesses whether an equity security without a readily determinable fair value qualifies to be measured at cost minus impairment, considers whether impairment indicators exist to evaluate whether the investment is impaired and, if so, records an impairment loss.

Upon sale of an equity security, the realized gain or loss is recognized in earnings.

At December 31, 2020, the Company holds two investments in equity securities, Tonogold common shares and Eclipse Gold Mining Corporation common shares, that have readily determinable fair values for which unrealized gains or losses are recognized in earnings.

At December 31, 2020, the Company has an investment in one equity security, Investment in SSOF, that does not have a readily determinable fair value and, accordingly, is accounted for at its cost minus impairment (Note 2).

Investments - Equity Method and Joint Ventures:

Investments in companies and joint ventures in which we have the ability to exercise 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, our share of the net earnings or losses of the investee are included in net income (loss) in the consolidated statements of operations.

We evaluate 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.

At December 31, 2020, the Company's 25 % membership interests in Pelen Limited Liability Company (“Pelen”), 15 % membership interests in Mercury Clean Up, LLC ("MCU") and 50 % common stock holdings of MCU-P are accounted for using the equity method (Note 2).

For companies and joint ventures where the Company holds more than 50% of the voting interests, but less than 100%, and has significant influence, the company or joint venture is consolidated, and other investor interests are presented as noncontrolling.

The Company’s investment in Comstock LLC was consolidated with presentation of noncontrolling interest through September 8, 2020 when the Company’s remaining membership interests were sold (Note 2).

Long-Lived Assets

We review the carrying amount of our long-lived assets for impairment whenever there are negative indicators of impairment.

An asset is considered impaired when estimated future undiscounted cash flows are less than the carrying amount of the asset.

In the event the carrying amount of such asset is not considered recoverable, the asset is adjusted to its fair value.

Fair value is generally determined based on discounted future cash flows.

Mineral Rights and Properties

We defer acquisition costs until we determine the viability of the property.

Since we do not have proven and probable reserves as defined by Securities and Exchange Commission ("SEC") Industry Guide 7 or by regulation S-K 1300, exploration expenditures are expensed as incurred.

We expense mineral lease costs and repair and maintenance costs as incurred.

We review the carrying value of our properties for impairment, including mineral rights upon the occurrence of events or changes in circumstances that indicate the related carrying amounts may not be recoverable.

Our estimate of precious metal prices, mineralized materials, operating capital, and reclamation costs are subject to risks and uncertainties affecting the recoverability of our investment in all of these properties.

Although we have made our best, most current estimate of these factors, it is possible that near term changes could adversely affect estimated net cash flows from our properties and mineral claims, and possibly require future asset impairment write-downs.

Where estimates of future net operating cash flows are not available and where other conditions suggest impairment, we assess recoverability of carrying value from other means, including net cash flows generated by the sale of the asset.

We use the units-of-production method to deplete the mineral rights and mining properties.

PROPERTIES, PLANT AND EQUIPMENT

We record properties, plant and equipment at historical cost.

We provide depreciation and amortization in amounts sufficient to match the cost of depreciable assets to operations over their estimated service lives or productive value.

We capitalize expenditures for improvements that significantly extend the useful life of an asset.

When an asset is sold, we recognize a gain (loss) in the consolidated statements of operations based upon the proceeds received on the sale less the net carrying value of

We charge expenditures for maintenance and repairs to operations when incurred.

The Company records properties, plant and equipment at historical cost.

The Company provides depreciation and amortization in amounts sufficient to match the cost of depreciable assets to operations over their estimated service lives or productive value.

The Company capitalizes expenditures for improvements that significantly extend the useful life of an asset.

When an asset is sold, the Company recognizes a gain (loss) in the consolidated statements of operations based upon the proceeds received on the sale less the net carrying value of the asset.

The Company charges expenditures for maintenance and repairs to operations when incurred.

Depreciation is computed using the straight-line method over estimated useful lives as follows:

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Furniture and fixtures 2 to 3 years

The Company reviews the carrying amount of our property, plant and equipment for impairment whenever there are negative indicators of impairment.

An asset is considered impaired when estimated future undiscounted cash flows are less than the carrying amount of the asset.

In the event the carrying amount of such asset is not considered recoverable, the asset is adjusted to its fair value.

Fair value is generally determined based on discounted future cash flows.

RECLAMATION LIABILITIES AND ASSET RETIREMENT OBLIGATIONS

Minimum standards for site reclamation and closure have been established for us by various government agencies and contractual obligations with lessors.

Asset retirement obligations are recognized when incurred and recorded as liabilities at fair value.

Asset retirement obligations are recognized when an obligation is incurred, either through regulatory requirements in the jurisdictions in which we operate or by contractual obligation with one of our lessors, and recorded as liabilities when a reasonable estimate of fair value can be determined.

An expected present value technique is used to estimate the fair value of the liability.

This includes inflating the estimated costs in today’s dollars using a reasonable inflation rate up to the date of expected retirement, and discounting the inflated costs using a credit-adjusted risk-free rate.

Upon initial recognition of the liability, the carrying amount of the related long-lived asset is increased by the same amount.

The liability is accreted over time through periodic charges to earnings.

In addition, the asset retirement cost is capitalized and amortized over the life of the related asset.

Reclamation costs are periodically adjusted to reflect changes in the estimated present value resulting from the passage of time and revisions to the estimates of either the timing or amount of the reclamation and abandonment costs.

The Company reviews, on an annual basis, unless otherwise deemed necessary, the asset retirement obligation at each mine site.

Separately, we accrue costs associated with environmental remediation obligations when it is probable that such costs will be incurred and they are reasonably estimable.

In addition, the asset retirement cost is amortized over the life of the related asset.

Changes resulting from revisions to the timing or amount of the original estimate of undiscounted cash flows are recognized as either an increase or a decrease in the carrying amount of the liability for an asset retirement obligation and the related asset

retirement cost capitalized as part of the carrying amount of the related long-lived asset.

Upward revisions of the amount of undiscounted estimated cash flows are discounted using the current credit-adjusted risk-free rate.

Downward revisions in the amount of undiscounted estimated cash flows are discounted using the credit-adjusted risk-free rate that existed when the original liability was recognized.

When asset retirement costs change as a result of a revision to estimated cash flows, the amount of the asset retirement cost is adjusted and allocated to expense in the period of the change if the change affects that period only or in the period of change and future periods if the change affects more than one period.

The Company reviews, on an annual basis, unless otherwise deemed necessary, the asset retirement obligations.

Separately, the Company accrues costs associated with environmental remediation obligations when it is probable that such costs will be incurred and they are reasonably estimable.

MINERAL RIGHTS AND PROPERTIES

The Company capitalizes acquisition costs until the Company determines the economic viability of the property.

Since the Company does not have proven and probable reserves as defined by Securities and Exchange Commission ("SEC") regulation S-K 1300, exploration expenditures are expensed as incurred.

The Company expenses mineral lease costs and repair and maintenance costs as incurred.

The Company reviews the carrying value of our properties for impairment, including mineral rights upon the occurrence of events or changes in circumstances that indicate the related carrying amounts may not be recoverable.

Although the Company has made our best, most current estimate of these factors, it is possible that near term changes could adversely affect estimated net cash flows from our properties and mineral claims, and possibly require future asset impairment write-downs.

Where estimates of future net operating cash flows are not available and where other conditions suggest impairment, the Company assesses recoverability of carrying value from other means, including net cash flows generated by the sale of the asset.

The Company uses the units-of-production method to deplete the mineral rights and mining properties when in operations.

TREASURY STOCK

When the Company’s stock is acquired for purposes it is initially valued at cost and presented as treasury stock.

Other than formal or constructive retirement or when ultimate disposition has not yet been decided, the cost of the acquired stock is presented as treasury stock separately as a deduction from the total of common stock, additional paid-in capital and retained earnings.

Gains on sales of treasury stock not previously accounted for as constructively retired are credited to additional paid-in capital, and losses are charged to additional paid-in capital to the extent that previous net gains from sales or retirements of the same class of stock are included therein, with the remainder charged to retained earnings.

When the Company's stock is retired or purchased for constructive retirement, any excess purchase price over par value is allocated between additional paid-in capital to the extent that previous net gains from sales or retirements are included therein, and the remainder to retained earnings.

REVENUE RECOGNITION

The Company has no contracts with customers as it does not have active mining operations.

When the Company resumes active mining operations and has revenue, it will account for revenue from contracts with customers by evaluating the following five steps:

(1) identify the contract with the customer;

(2) identify the performance obligations in the contract;

(3) determine the transaction price;

(4) allocate the transaction price to the performance obligations;

and (5) recognize revenue when (or as) performance obligations are satisfied.

Real estate revenue is recognized when rental income is earned under the related leasing agreements.

Renewable Energy Products Segment

For the majority of our operations, services revenues are recognized when services are performed and are contractually billable.

For service contracts, principally engineering and construction management service, we recognize revenue over a period of time based on estimated progress toward completion.

Service contracts that include multiple performance obligations are segmented between types of services.

For contracts with multiple performance obligations, we allocate the transaction price to each performance obligation using an estimate of the stand-alone selling price of each distinct service in the contract.

Revenue recognized on service contracts that has not been billed to clients is recorded as contract assets.

Amounts billed to clients in excess of revenue recognized on service contracts to date are recorded as contract liabilities.

Customer payments are typically due within 30 to 45 days of billing, depending on the contract.

Strategic and Other Investments

We generate rental revenues from tenants via long-term lease contracts in various forms, including lease and sublease agreements.

Providing access to the leased land and facilities, and performing specified repair and maintenance services over the length of the tenant contract term represent our performance obligations under our tenant contracts.

Tenant rental payments are typically due monthly or quarterly, depending on the contract.

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 accounted for based on the fair value of the equity interest issued.

The fair value of shares of common stock is determined based upon the closing price per share of the Company’s common stock on the date of the award.

The Company estimates the fair value of stock-based compensation (e.g., option) using the Black-Scholes model, which requires the input of various 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.

Reverse Stock Split

Effective November 28, 2019, the Company completed a 1-for-5 (reverse) stock split of its authorized and outstanding shares of common stock, as approved by its Board of Directors.

All common shares and per share amounts herein give effect to this reverse split.

The Company’s income tax expense and deferred tax assets and liabilities reflect management’s best assessment of estimated future taxes to be paid.

All transactions in which goods or services are received for the issuance of shares of our common stock or options to purchase shares of our common stock are accounted for based on the fair value of the equity interest issued.

The fair value of shares of common stock is determined based upon the closing price per share of our common stock on the date of issuance and other applicable inputs.

The Company recognizes stock-based compensation for common stock grants evenly over the related vesting period.

The fair value of market condition performance share awards is determined based on path-dependent valuation techniques and inputs including the closing price per share of our common stock at date of grant, volatility and the risk-free interest rate.

The Company recognizes stock-based compensation for market condition performance share awards evenly over the derived service period resulting from the path-dependent valuation.

The fair value of performance condition share awards is determined based on the closing price per share of our common stock at date of grant and the probability of achieving the performance condition during the term of the award agreement.

The Company recognizes stock-based compensation for performance condition share awards evenly over the term of the award agreement.

The Company recognizes forfeitures of unvested common stock, performance shares and stock option grants as they occur.

RECLASSIFICATIONS

Certain prior year amounts have been reclassified to conform to the 2021 financial statement presentation.

Reclassifications had no effect on net income (loss), stockholders' equity, or cash flows as previously reported.

The Company’s income tax expense and deferred tax assets and liabilities reflect management’s best assessment of estimated future taxes to be paid or refunded.

Significant judgments and estimates are required in determining the consolidated income tax expense.

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In projecting future taxable income, the Company develops assumptions including the amount of future state and federal pretax operating income, the reversal of temporary differences, and the implementation of feasible and prudent tax planning strategies.

These assumptions require significant judgment about the forecasts of future taxable income and the assumptions are consistent with the plans and estimates that the Company is using to manage the

underlying businesses.

These assumptions require significant judgment about the forecasts of future taxable income and the assumptions are consistent with the plans and estimates that the Company is using to manage its underlying businesses.

The Company provides a valuation allowance for deferred tax assets that the Company does not consider more likely (than not) to be realized.

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Parties, which can be entities or individuals, are considered to be related if either party has the ability, directly or indirectly, to control or exercise significant influence over the other party in making financial and operational decisions.

Entities and individuals are also considered to be related if they are subject to the common control or significant influence of another party (Notes 3 and 21).

Entities and individuals are also considered to be related if they are subject to the common control or significant influence of another party (See Note 3, Notes Receivable and Advances , Net and Note 21, Related Party Transactions ).

The Company determines if a contract is or contains a lease at its inception and evaluates if a contract gives the right to obtain substantially all of the economic benefits from use of an identified asset and the right to direct the use of the asset, in order to determine if a contract contained a lease.

The Company has one existing lease contract classified as an operating lease contract.

For this lease, the Company recognized a right-of-use asset and a corresponding operating lease liability on its consolidated balance sheets.

The Company has two existing lease contracts one classified as an operating lease contract and one finance lease.

For these leases, the Company recognized a right-of-use asset and a corresponding lease liability on its consolidated balance sheets.

Right-of-use assets represent the Company’s right to use an underlying asset for the lease term, and lease liabilities represent obligations by the Company to make lease payments which arise from a lease.

Lease right-of-use assets and liabilities are recognized at the inception date based on the present value of lease payments over the lease term.

of-use assets and liabilities are recognized at the inception date based on the present value of lease payments over the lease term.

As the Company’s lease contracts do not provide an implicit rate, the Company uses its incremental borrowing rate based on the information available at the inception date in order to determine the present value of lease payments.

Lease expense for lease payments is recognized on a straight-line basis over the lease term, in real estate operating costs.

For operating leases, fixed lease payments are recognized as lease expense on a straight-line basis over the lease term.

For finance leases, the initial right-of-use asset is depreciated on a straight-line basis over the lease term, along with recognition of interest expense associated with accretion of the lease liability, which is ultimately reduced by the related fixed payments.

For leases with a term of 12 months or less, lease payments are recognized on a straight-line basis over the lease term and are not recognized on the consolidated balance sheets.

The outbreak in 2020 of the novel coronavirus (“COVID-19”) resulted in governments worldwide enacting emergency measures to combat the spread of the virus.

These measures, including the implementation of social distancing measures, quarantine periods and travel bans, have caused material disruptions to many businesses and negatively impacted economic activities.

Global equity markets have experienced significant volatility.

Governments and their central banks have reacted with significant fiscal and monetary interventions designed to mitigate the impacts and stabilize economic conditions.

The impact and ultimate duration of the COVID-19 outbreak is currently unknown, as is the efficacy of these governmental interventions.

For nearly two years in Nevada, local governments, state health officials, emergency managers, local health authorities and community partners have come together in a statewide response to COVID-19.

Processes continue to be in place to support testing, contact tracing, disease investigation and vaccine rollout in communities throughout the state.

On January 18, 2022, Nevada Health Response provided an update on county risk levels as posted by the Centers for Disease Control and Prevention (CDC).

As of that date, all Nevada counties were listed as high risk of transmission.

Cases continued to increase rapidly across the state with the recent omicron variant surge.

According to Directive 045 signed by Nevada Governor Steve Sisolak, everyone, regardless of vaccination status, will be required to wear masks in indoor settings again.

On February 10, 2022, after a marked decline in new omicron variant cases, Nevada Governor Steve Sisolak announced that the state was dropping its statewide mask mandate, "effective immediately".

We are operating in alignment with these guidelines for protecting the health of our employees, partners and suppliers.

RECENTLY ISSUED ACCOUNTING PRONOUNCEMENTS

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The Company is currently evaluating the impact of adopting this standard on its consolidated financial statements.

In January 2020, the FASB issued ASU No.

2020-01, Clarifying the Interactions Between Topic 321, Topic 323 and Topic 815.

ASU 2020-01 which makes improvements related to accounting for certain equity securities when the equity method of accounting is applied or discontinued, and scope considerations related to forward contracts and purchased options on certain securities.

ASU 2020-01 is effective for fiscal years beginning after December 15, 2020.

The Company is currently evaluating the impact of adopting this standard on its consolidated financial statements.

In October 2018, the FASB issued ASU No.

2018-17, Targeted Improvements to Related Party Guidance for Variable Interest Entities (“ASU 2018-17”), which expands the application of a specific private company alternative related to VIEs and changes the guidance for determining whether a decision-making fee is a variable interest.

Under the new guidance, to determine whether decision-making fees represent a variable interest, an entity considers indirect interests held through related parties under common control on a proportionate basis, rather than in their entirety.

ASU 2018-17 is effective for annual periods beginning after December 15, 2019, including interim periods within those fiscal years, and early adoption is permitted in any

interim period.

ASU 2018-17 is required to be applied retrospectively from the date the guidance is first applied.

The Company's adoption of this standard on January 1, 2020 did not have a material impact on its consolidated financial statements.

In August 2018, the FASB issued ASU 2018-13, Fair Value Measurement (Topic 820):

Disclosure Framework - Changes to the Disclosure Requirements for Fair Value Measurement, which removes, modifies and adds various disclosure requirements related to fair value disclosures.

Disclosures related to transfers between fair value hierarchy levels will be removed and further detail around changes in unrealized gains and losses for the period and unobservable inputs used in determining level 3 fair value measurements will be added, among other changes.

ASU 2018-13 is effective for interim and annual reporting periods beginning after December 15, 2019, and early adoption is permitted.

The Company modified the disclosures beginning in the first quarter of 2020 to conform to this guidance.

The Company's adoption of this standard on January 1 2020 did not have a material impact on its consolidated financial statements.

The outbreak of the coronavirus (aka “COVID-19”) has resulted in governments worldwide enacting emergency measures to combat the spread of the virus.

Global equity markets have experienced significant volatility.

Governments and their central banks have reacted with significant fiscal and monetary interventions designed to mitigate the impacts and stabilize economic conditions.

The impact and ultimate duration of the COVID-19 outbreak is currently unknown, as is the efficacy of these governmental interventions.

The Company is operating in alignment with these state and federal guidelines for protecting the health of our employees, partners, and suppliers, and limiting the spread of COVID-19, that have already resulted in delays of MCU’s plans for commencing mercury recovery testing on the Comstock and in the Philippines (Note 2).

It is not currently possible to reliably estimate the length and severity of these delays and the impact on the Company's financial condition, and that of its subsidiaries and partners, in future periods.

Significant Transactions

Tonogold Resources Inc.

Securities, Purchase, Lease and Option Agreements

There are three agreements between the Company and Tonogold:

the Membership Interest Purchase Agreement, the Mineral Exploration and Mining Lease, and the Lease Option Agreement for the Company's American Flat processing facility.

Membership Interest Purchase Agreement

On January 24, 2019, the Company entered into an agreement, as amended and restated on September 8, 2020, to sell its interests in Comstock LLC, a wholly-owned subsidiary with sole net assets of the Lucerne properties and related permits, to Tonogold (the "Purchase Agreement”), with the initial closing on November 18, 2019.

On September 8, 2020, 100 % of Comstock LLC membership interests were transferred to Tonogold.

On November 18, 2019, Tonogold received 50 % of the membership interests of Comstock LLC, in exchange for the consideration paid to date of $ 5.9 million in cash and CPS with fair value when received of $ 7.6 million.

The Company retained all management control and authority over Comstock LLC until Tonogold's membership interests totaled 100 %.

Accordingly, Tonogold’s membership interests in Comstock LLC were accounted for as a noncontrolling interest in the consolidated financial statements through September 8, 2020.

The Company recorded the fair value received from Tonogold in excess of the noncontrolling interest as additional paid in capital in 2019.

Consideration received in 2020 prior to the close on September 8, 2020 totaled $ 1,140,000 ($ 100,000 of which was additional contribution, $ 140,000 additional compensation at closing, and $ 900,000 payments on the note receivable).

The additional contribution was allocated between additional paid in capital and the non-controlling interest based upon the percentage ownership at the time the consideration was received.

On September 8, 2020, the Purchase Agreement was finalized, and 100 % of the membership interests in Comstock LLC were acquired by Tonogold.

The fair value of the consideration delivered by Tonogold in 2019 and 2020 for the membership interests in Comstock LLC was $ 18.8 million, and included cash, CPS, and the note receivable.

In March 2021, the FASB issued ASU 2021-07 (Topic 323), Investments – Equity Method and Joint Ventures.

The new guidance eliminates the requirement that when an investment qualifies for use of the equity method as a result of an increase in the level of ownership interest or degree of influence, an investor must adjust the investment, results of operations, and retained earnings retroactively on a step-by-step basis as if the equity method had been in effect during all previous periods that the investment had been held.

The guidance is effective for fiscal years, beginning after December 15, 2021.

Early adoption is permitted.

The Company is currently evaluating the possible impact of ASU 2021-07, but does not anticipate that it will have a material impact on the Company's consolidated financial statements.

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.

NOTE 2 ACQUISITIONS AND INVESTMENTS

Acquisition of Comstock Innovations Corporation (F/K/A Plain Sight Innovations Corporation)

On September 7, 2021, we acquired 100 % of the issued and outstanding equity and voting shares of Comstock Innovations Corporation (F/K/A Plain Sight Innovations Corporation) (“Comstock Innovations”), in exchange for 8,500,000 restricted shares of our common stock with a fair value of $ 14,952,806 (see Note 15, Fair Values Measurements ).

We incurred $ 28,825 of legal expense in connection with the acquisition, that has been recognized as selling, general and administrative expense on the consolidated statements of operations for the year ended December 31, 2021.

The PSI acquisition brings an array of patented, patent-pending and proprietary process technologies that were designed to convert low cost, ubiquitous woody biomass feedstocks into renewable fuels and other carbon neutral alternatives for fossil fuel derivatives.

Comstock Innovations operates a commercial pilot cellulosic fuel facility that converts woody biomass into cellulosic ethanol and co-product precursors for renewable diesel and other carbon neutral alternatives to fossil fuels.

In connection with the Comstock Innovations closing, the Company agreed to appoint a designee of one of the former shareholders of Comstock Innovations, Triple Point Asset Management LLC (“TPAM”), to the Company’s board of directors and as Comstock’s president and chief financial officer, and agreed to appoint a designee of another one of the former shareholders of Comstock Innovations, Global Catalytic Disruptor Fund LLC (“GCDF”), to serve as Comstock’s chief technology officer.

TPAM’s appointee is Kevin Kreisler, the beneficial owner and sole manager, executive officer and director of TPAM.

GCDF’s appointee is David Winsness, the beneficial owner and sole manager, executive officer and director of GCDF.

The Comstock Innovations purchase price consideration and provisional allocation to net assets acquired is presented below:

Fair value of consideration transferred:

Comstock shares of common stock issued ( 8,500,000 at $ 1.76 per share)

Loans to Plain Sight Innovations LLC prior to acquisition 1,423,328

Total fair value of consideration transferred 16,376,134

Recognized amounts of identifiable assets acquired

Cash and cash equivalents $ 100,147

Intangible assets - Intellectual property

Developed technologies 6,579,400

License agreements 494,133

Deferred tax liability ( 1,383,942 )

Total identifiable assets 5,789,738

Goodwill $ 10,586,396

The goodwill is attributable to the workforce of the acquired business and the significant synergies expected to arise from the acquisition of PSI.

The goodwill is not deductible for tax purposes.

All of the $ 10,586,396 goodwill was assigned to the Renewable Energy Products segment.

From the acquisition date through December 31, 2021, Comstock Innovations recognized no revenue and incurred a loss before deferred income tax benefit of $ 1,303,969 .

There are no nonrecurring pro forma adjustments directly attributable to the business combination other than the deferred tax benefit included in the reported pro forma earnings.

The pro forma financial information below represents the combined results of operations for the year ended December 31, 2021 as if the acquisition had occurred as of Comstock Innovations' March 1, 2021 date of incorporation, with pro forma amortization expense related to acquired intangible assets included from January 1, 2021.

The unaudited pro forma financial information is presented for informational purposes only and is neither indicative of the results of operations that would have occurred if the acquisition had taken place at the beginning of the period presented nor indicative of future operating results.

December 31, 2021

Revenue $ 868,165

Net loss $ ( 25,777,145 )

Acquisition of Assets from FLUX Photon Corporation

On September 7, 2021, we purchased all of the intellectual property assets of PSI’s affiliate, FLUX Photon Corporation (“FPC”), in exchange for performance-based cash payments equal to 20 % of our future consolidated Net Cash Flow (as defined in the related Asset Purchase Agreement) up to $ 18,000,000 .

The acquired FPC intellectual property includes new approaches to carbon capture and utilization, atmospheric water harvesting, waste heat and energy recovery, industrial photosynthesis for mass scale decarbonization, and the sustainable production of very large agricultural outputs for fractional inputs.

On December 10, 2021, the Asset Purchase Agreement was amended to provide for the payment by the Company of a $ 350,000 down payment against the purchase price, corresponding to a potential performance-based cash payment of $ 17,650,000 required under the Asset Purchase Agreement.

The FPC intangible assets were valued at $ 9,771,750 at the acquisition date.

We have not recorded the purchased assets or related contingent purchase consideration (other than the $ 350,000 down payment mentioned above), as we have determined the fair value of the intellectual property is not realizable in the foreseeable future, and the contingent purchase consideration is neither probable nor reasonably estimable.

The FPC intangible assets will recognized as payments are made under the Asset Purchase Agreement or when payments become probable and reasonably estimable.

Acquisition of MANA Corporation

On July 23, 2021, we acquired 100 % of the issued and outstanding equity and voting shares of MANA (“MANA”), an industrial hemp technology development, marketing, and management company, in exchange for 4,200,000 restricted shares of the our common stock with a fair value of $ 6,528,453 (See Note 15, Fair Value Measurements ).

Industrial hemp is a natural resource with numerous known applications, including food, feed, fuel, and fiber, and an array of emerging applications in batteries, bioplastics, and other renewable alternatives to fossil fuel derived products.

We expect MANA to provide a suite of complementary technology, marketing and other management services, with a focus on acquiring and using pre-existing and new feedstock and offtake arrangements.

Following the acquisition, Comstock transferred its ownership interests in LPB to MANA.

The purchase consideration for MANA was based on part on MANA's contingent payment obligation equal to 20 % of MANA's future Net Cash Flow (as defined in the related agreement) up to $ 8.6 million.

We have not recorded the assumed contingent liability, as we have determined it is neither probable nor reasonably estimable.

The MANA purchase price consideration and provisional allocation to net assets acquired is presented below:

Fair value of consideration transferred:

Comstock shares of common stock issued ( 4,200,000 at $ 1.55 per share)

Total fair value of consideration transferred 6,528,453

Recognized amounts of identifiable assets acquired and liabilities assumed:

Intangible assets - Customer agreements (Note 9) $ 461,528

Deferred tax liability ( 96,921 )

Total identifiable net assets 364,607

Goodwill $ 6,163,846

From the acquisition date through December 31, 2021, MANA recognized $ 100,000 of revenue and incurred a loss before deferred income tax benefit of $ 13,442,547 (including impairment of goodwill and intangible assets of $ 6,394,610 and a $ 6,300,000 decrease in the fair value of the LPB derivative asset).

There are no nonrecurring pro forma adjustments directly attributable to the business combination other than the deferred tax benefit included in the reported pro forma earnings.

The pro forma financial information below represents the combined results of operations for the year ended December 31, 2021, as if the acquisition had occurred as of MANA’s February 16, 2021 date of incorporation, with pro forma amortization expense related to acquired intangible assets included from January 1, 2021.

December 31, 2021

Revenue $ 862,165

Net loss $ ( 24,756,693 )

The Company fully impaired the MANA intangible asset related to the LPB contract, which was terminated during the first quarter 2022 and recognized an impairment loss of $ 230,764 in other income (expenses) in the statement of operations during the year ended December 31, 2021 in the renewable energy products segment.

The Company assessed the remaining value in the MANA reporting unit and determined the fair value to be nominal.

The fundamental economic substance of the MANA acquisition was related to the management team’s ability to develop the hemp business through the LPB contract.

With the loss of LPB, the assumptions underlying the value assigned in the purchase price allocation of MANA have changed significantly, resulting in a full loss in the value of goodwill totaling $ 6,163,846 related to the acquisition.

The MANA organization has been redeployed, primarily into Comstock Fuels and other related corporate activities.

Acquisition of Assets in LINICO Corporation

On February 15, 2021, the Company, Aqua Metals, Inc.

(“AQMS”) and LINICO entered into a Series A Preferred Stock Purchase Agreement (“February Agreement”).

Judd Merrill, a member of the Company’s board of directors, is the chief financial officer of AQMS.

Pursuant to the February Agreement, we purchased 6,250 shares of LINICO Series A 8% Convertible Preferred Stock (“Series A Preferred”) and issued 3,000,000 shares of our restricted common stock with a fair value of $ 6,750,000 in payment of the purchase price;

$ 6,250,000 of which was in connection with our investment and $ 500,000 of which was recognized as a related derivative asset (see Note 15, Fair Value Measurements ).

The Series A Preferred has a conversion price of $ 1.25 per share of LINICO common stock.

Following the purchase of the Series A Preferred, we owned 45.45 % of LINICO in substance common shares and 48.78 % of voting shares.

Our chief executive officer is a member and Chairman of the LINICO board of directors.

Under the February Agreement, we also agreed to make $ 4,500,000 in cash payments to LINICO (“Cash Commitment”), payable in a series of installments between February 26, 2021 and December 31, 2021.

At December 30, 2021, $ 4,500,000 had been paid, and recorded as adjustment to the derivative asset related to LINICO on the consolidated balance sheets.

We incurred $ 70,273 of legal expense in connection with the LINICO investment and recognized $ 1,282,336 in equity loss from affiliates for our investment in LINICO prior to December 30, 2021.

On December 30, 2021, the Company entered into an agreement to acquire 3,129,081 LINICO common shares from its former chief executive officer and director equating to 90 % ownership.

The former chief executive officer resigned from LINICO as a member of its board of directors and in all other capacities, effective as of such date.

In connection with the acquisition of such LINICO shares, the Company issued 3,500,000 common shares of the Company (“Comstock Shares”) to the former chief executive officer.

If and to the extent that the sale of the Comstock shares results in net proceeds greater than $ 7,258,162 , then the former chief executive officer is required to pay all of such excess proceeds to the Company.

If and to the extent that the sale of the Comstock Shares results in net proceeds less than $ 7,258,162 , then the Company is required to pay cash to the former chief executive officer equal to such shortfall.

The Company retained the right to purchase the Comstock Shares from the former chief executive officer for the purchase price of $ 7,258,162 less the amount of cash proceeds received by the former chief executive officer from any previous sale of the Comstock Shares by the former chief executive officer, at any time during or prior to his sale of the Comstock shares.

At December 30, 2021, we owned 90 % of LINICO's issued and outstanding equity and the remaining 10 % was owned by Aqua Metals Inc.

The fair value of the 1,700,000 shares held by AQMS at the date of acquisitions was $ 3,400,000 , which was calculated at $ 2.00 per share.

The LINICO purchase price consideration and provisional allocation to net assets acquired is presented below:

Fair value of consideration transferred:

Previously held equity interest $ 8,140,725

Cash contributions 6,025,034

Common shares 7,258,162

Non-controlling interest - fair value 3,400,000

Total fair value of consideration and non-controlling interest $ 24,823,921

Recognized amounts of identifiable assets acquired and liabilities assumed:

Cash and cash equivalents $ 94,689

Other current assets 222,568

Investment in Green Li-ion 4,577,000

Investment in equity securities (Comstock common stock) 3,870,000

Properties, plant and equipment, net 64,000

Deposits 3,897,526

Finance lease right of use asset 15,033,000

Intangible assets —

Developed technologies 11,803,000

Lease intangible 3,622,488

Trademarks 6,000

Accounts payable ( 975,357 )

Accrued expenses and other liabilities ( 97,268 )

Finance lease liability ( 13,043,499 )

Deferred tax liability ( 4,250,226 )

Total identifiable net assets $ 24,823,921

Acquisition of Renewable Process Solutions, Inc.

On June 18, 2021, we acquired 100 % of the issued and outstanding equity and voting shares of Comstock Engineering Corporation (F/K/A Renewable Process Solutions, Inc.), a process engineering and renewable technology development company, in exchange for 1,000,000 restricted shares of our common stock, with a fair value of $ 2,304,806 .

(See Note 15, Fair Value Measurements ).

RPS was acquired to increase our core competencies in process engineering and renewable technology development necessary to facilitate the development and growth of our acquired companies and equity method investments.

The purchase price consideration and provisional allocation to net assets acquired is presented below:

Fair value of consideration transferred:

Comstock shares of common stock issued ( 1,000,000 at $ 2.30 per share)

Total fair value of consideration transferred 2,304,806

Recognized amounts of identifiable assets acquired and liabilities assumed:

Cash and cash equivalents 24,385

Notes receivable, net 38,459

Prepaid expenses and other current assets 4,072

Intangible assets

License agreements 16,619

Customer agreements 122,885

Distribution agreements 19,733

Accounts payable ( 33,882 )

Deferred tax liability ( 33,440 )

Accrued expenses and other liabilities ( 56,300 )

Total identifiable net assets 102,531

Goodwill $ 2,202,275

From the acquisition date through December 31, 2021, the Company's revenue and net income before deferred income tax benefit were $ 983,380 and $ 426,803 , respectively.

There are no nonrecurring pro forma adjustments directly attributable to the business combination other than the deferred income tax benefit included in the reported pro forma earnings.

The goodwill is attributable to the workforce of the acquired business and the significant synergies expected to arise from the acquisition of RPS.

The goodwill is not deductible for tax purposes.

All of the $ 2,202,275 goodwill was assigned to the Renewable Energy Products segment.

The pro forma financial information below represents the combined results of operations for the year ended December 31, 2021 and 2020 as if the acquisition had occurred at the beginning of the periods presented.

The unaudited pro forma financial information is presented for informational purposes only and is neither indicative of the results of operations that would have occurred if the acquisition had taken place at the beginning of the periods presented nor indicative of future operating results.

Unaudited Unaudited

December 31, 2021 December 31, 2020

Revenue $ 983,380 $ 226,630

Net income (loss) $ ( 24,720,177 ) $ 14,445,248

Summary of Investments

Our investments are accounted for under the equity method, with one investment accounted for at cost less impairment.

At December 31, 2021 and 2020, our non-current investments include:

December 31, 2021 December 31, 2020

Investment Ownership % Investment Ownership %

Quantum Generative Materials LLC $ 13,645,946 48.19 % $ — — %

LP Biosciences LLC 4,227,587 50.00 % — — %

Green Li-ion 4,577,000 20.00 % — — %

Mercury Clean Up, LLC 1,975,026 25.00 % 2,010,113 15.00 %

MCU Philippines, Inc.

499,269 50.00 % 323,770 50.00 %

Pelen Limited Liability Company 591,051 25.00 % 603,714 25.00 %

Total equity method investments 25,515,879 2,937,597

Sierra Springs Opportunity Fund, Inc., at cost 335,000 335,000

Total Investments $ 25,850,879 $ 3,272,597

Summary financial information for affiliated companies ( 20 % to 50 %-owned) accounted for by the equity method is as follows:

December 31, 2021 * December 31, 2020

Current assets $ 8,336,962 $ 1,193,362

Non-current assets 12,985,338 4,212,385

Current liabilities 3,173,869 354,009

Non-current liabilities 2,000,000 1,000,000

Revenues 352,263 562,500

Gross Profit ( 74,048 ) ( 111,064 )

Net income (loss) and net income (loss) attributable to the entity $ ( 3,730,954 ) $ ( 580,346 )

* Information presented as of and for the years ended September 30, 2021 and 2020.

All equity method investments are

accounted for on a one-quarter lag.

The excess of our investment values over the net assets of the individual investees is primarily comprised of goodwill.

We periodically assess the net assets of our equity method investees and confirm there are no other assets that may require additional adjustments.

Significant amounts due to and from equity method investees included in the summarized financial information include the aggregate value of the Company's stock held by investees and any make-whole derivatives of $ 8 million, which is included in non-current assets and long-term debt due to the Company of $ 2 million, which is included in non-current liabilities as of December 31, 2021.

Long-term debt due to the Company of $ 1 million is included in non-current liabilities as of December 31, 2020.

Investment in Quantum Generative Materials LLC

On June 24, 2021, we invested in the equity of GenMat, a developer of quantum computing technologies with the goal of accelerating material science discovery and development, and partnering in the commercialization of new quantum generated materials.

GenMat is developing a proprietary quantum operating system to harness emerging quantum computing technologies and develop new materials for use in our strategically aligned fields of interest, including global mining, battery recycling, and carbon capture.

We incurred $ 71,659 of legal expense in connection with the GenMat investment, which has been recorded to non-current investments on the consolidated balance sheets at December 31, 2021.

At closing, we received 465,000 membership units and committed $ 5,000,000 in cash and $ 10,000,000 in stock for a total of $ 15,000,000 for the initial seed investment and committed an additional $ 35,000,000 based upon GenMat’s realization of key development milestones, for up to 50 % ownership of GenMat membership units.

At December 31, 2021, we have paid $ 4,250,000 in cash toward the $ 5,000,000 in scheduled cash commitment, At closing, we issued 3,000,000 restricted shares of our common stock with a fair value of $ 10,530,000 toward the $ 10,000,000 required stock purchase price and recorded a $ 530,000 related derivative asset (see Note 14, Equity and Note 15, Fair Value Measurements ).

For the year ended December 31, 2021, the Company recorded $ 675,713 in equity loss from affiliates for the investment in GenMat.

At December 31, 2021 , we hold 48.19 % of GenMat membership units and 37.50 % of voting membership units.

We represent 50 % of GenMat's governing body, through three of the six voting members of the management committee.

Our chief executive officer is a member and chair of the GenMat management committee, along with our president and chief financial officer, and another company designee.

Investment in LP Biosciences LLC

On July 23, 2021, we executed a series of agreements with Lakeview Energy LLC (“Lakeview”) and its subsidiaries, including LP Nutrition LLC ("LPN"), pursuant to which we acquired 50 % of the equity of Lakeview’s subsidiary, LPB, and agreed to provide the financing needed to retrofit LPB’s pre-existing industrial scale solvent extraction and valorization facility in Merrill, Iowa (“LPB Facility”), for the production of an array of wholesale products from up to 200,000 pounds per day of industrial hemp.

The Company also purchased 500,000 Class A Units, representing 50 % of the issued and outstanding voting equity of LP Biosciences LLC (“LPB”), from LPN, a subsidiary of Lakeview Energy LLC.

In connection with the foregoing, the Company entered into a Note Purchase Agreement to purchase a secured note with a face value of $ 17,000,000 from LPB (the “LPB Note”) in exchange for a purchase price of $ 15,000,000 to fund the completion of the facility retrofit.

The Company issued 3,500,000 restricted shares of its common stock with a fair value of $ 10,800,000 , paid $ 1,076,258 in cash and agreed to pay an initial $ 1,500,000 in cash in connection with its foregoing equity purchase and financing commitments.

The LPB Note was to mature on July 31, 2026, and the interest rate is 13.5 % per annum.

In connection with the LPB Note, LPB granted a leasehold security interest in the Facility to the Company, subject to a mortgage of approximately $ 4.6 million on the LPB Facility held by LPB’s landlord for the benefit of the landlord’s lender.

The Company, LPN, and LPB simultaneously entered into a Partnership Interest Purchase Agreement and a Limited Liability Company Operating Agreement for LPB, pursuant to which, among other terms, LPB agreed to pay LPN the first $ 3,000,000 of cash proceeds received from the sale of the Company’s common stock, and a $ 5,000,000 preferred distribution at the same time and in the same proportion as principal prepayments on the LPB Note, with up to 20 % of LPB’s after debt net cash flow commencing 20 days after LPB commences ordinary course operations.

The Company assigned its Class A Units in LPB to MANA upon completion of the LPB transaction.

Subsequent to December 31, 2021, on February 28, 2022, the Company and Nutrition mutually agreed to terminate the LPB transaction documents.

Upon termination, each of the parties were relieved of their respective rights, liabilities, expenses, and obligations.

3,500,000 restricted shares of the Company’s common stock were transferred back to the Company for cancellation upon receipt.

In the first quarter of 2022, the Company incurred expenses of approximately $ 750,000 in connection with the termination of the transaction documents as of the filing date.

As of December 31, 2021, the notes receivable, prepaid assets and other deposits associated with LP Biosciences of $ 1,076,258 were written off, including $ 500,000 of restricted cash held in escrow, which LPB had rights to under the termination agreement.

Transactions Involving Comstock Minerals, Sale of Comstock Mining LLC

On January 24, 2019, the Company entered into a membership interest purchase agreement, as amended and restated on September 8, 2020, to sell its interests in Comstock Mining LLC, a wholly-owned subsidiary with sole net assets of the Lucerne properties and related permits (“Comstock Lucerne”), to Tonogold Resources, Inc.

("Tonogold").

The Convertible Preferred Stock ("CPS") became convertible into Tonogold common shares commencing May 22, 2020, at a rate equal to the lower of (1) $ 0.18 cents per share, or (2) 85 % of the 20 -day volume weighted average closing price of Tonogold common shares.

Tonogold could redeem the CPS prior to conversion, at a redemption price 120 % of the face value of the CPS.

On November 18, 2019, 50 % of Comstock Lucerne was transferred to Tonogold.

The remaining 50 % was transferred on September 8, 2020.

The Company retained all management control and authority over Comstock Lucerne until Tonogold's membership interests totaled 100 %.

Accordingly, Tonogold’s membership interests in Comstock Mining LLC were accounted for as a noncontrolling interest in the Company’s Consolidated Financial Statements through September 8, 2020.

On September 8, 2020, the remaining membership interests of Comstock Mining LLC were purchased by Tonogold.

There are two agreements between the Company and Tonogold associated with the September 2020 sale of the membership interests of Comstock Mining LLC:

the Membership Interest Purchase Agreement, the Mineral Exploration and Mining Lease, and a Lease Option Agreement for our American Flat processing facility.

Under the two agreements, Tonogold is required to reimburse certain payments made by Comstock including but not limited to all costs associated with owning certain properties, and certain option, interest expense and lease payments.

On March 3, 2021, we made a $ 812,500 accelerated payment to Northern Comstock pursuant to the Northern Comstock operating agreement.

Primarily as a result of the Northern Comstock accelerated payment, the Tono Note was amended in March 2021, which included adding $ 812,500 for Tonogold’s Northern Comstock accelerated payment reimbursement obligation and an amendment fee of $ 262,500 to the principal amount of the Tono Note, increasing the principal amount to $ 5,550,000 .

The Note was further amended in June 2021, to add $ 1.0 million for certain Tonogold, Northern Comstock and other reimbursement obligations and an amendment fee of $ 100,000 which were added to the principal amount of the Tono Note, increasing the principal amount to $ 6,650,000 and extending the maturity date to March 31, 2022.

A total of $ 362,500 of amendment fees were recognized as other income in 2021.

The fair value of the consideration delivered by Tonogold in 2019 and 2020 for the membership interests in Comstock Lucerne was $ 18.8 million, and included cash, CPS, and the Tono Note.

The Company's gain on the sale was $ 18.3 million, recorded during the year ended December 31, 2020 in the consolidated statements of operations.

Total consideration received from Tonogold in 2019 and 2020:

The total consideration received by the Company from Tonogold under the Lucerne Purchase Agreement is summarized in the following table:

Cash $ 7,065,000

Non-cash items, fair value on date received

Tonogold CPS 7,607,263

Tonogold note receivable 6,141,497

CPS 7,607,263

Tono Note 6,141,497

Contingent forward asset, fair value on settlement date ( 1,998,832 )

Total consideration 18,814,928

Net carrying value Comstock Mining LLC ( 539,082 )

Net carrying value of Comstock Lucerne ( 539,082 )

Net gain on sale $ 18,275,846

The gain was recognized in the consolidated statements of operations for the year ended December 31, 2020.

As a result of the sale of 100 % membership interest in Comstock LLC, the Company deconsolidated Comstock LLC which resulted in a decrease in additional paid in capital of $ 20.5 million and elimination of the non-controlling interest of $ 0.3 million.

Other features of the Purchase Agreement include Tonogold guaranteeing the Company’s future payments of capital contributions required under the operating agreement of Northern Comstock LLC, which owns and leases certain mineral properties in the Lucerne area, the assumption of certain reclamation liabilities, and the reimbursement of certain operating costs.

The Company also retains a 1.5 % net smelter return ("NSR") royalty on the Lucerne properties.

Cash - Through September 8, 2020, the Company received $ 7.1 million in a series of cash payments from Tonogold, starting with a $ 1.0 million non-refundable deposit in January 2019, and concluding with $ 140,000 at closing of the Purchase Agreement.

The Company received cash payments of $ 1.1 million and $ 5.9 million for the years ended December 31, 2020 and 2019, respectively.

Tonogold CPS and Common Shares - The consideration received under the Purchase Agreement included the CPS.

During 2019, the Company received $ 6.1 million face value in Tonogold CPS.

The CPS was recorded by the Company at a fair value of $ 7.6 million when received.

The CPS became convertible into common shares on May 22, 2020.

The conversion price for the CPS was the lower of (1) $ 0.18 cents per share, or (2) 85 % of the 20 -day volume weighted average closing price of Tonogold common shares.

Tonogold could redeem the CPS prior to conversion, at a redemption price 120 % of the face value of the CPS.

On May 22, 2020 and September 29, 2020, the Company elected to convert CPS with a face value of $ 1.1 million and $ 2.8 million, respectively, at $ 0.18 per common share, for a total of 21.8 million Tonogold common shares.

On October 2, 2020, Tonogold redeemed the remaining $ 2.2 million face value of CPS for $ 2.6 million in cash, representing 120 % of face value.

During the years ended December 31, 2020 and 2019, the Company recognized gains (losses) on the change in fair value of the CPS of $( 2.5 ) million and $ 1.5 million, respectively.

During the year ended December 31, 2020, the Company sold 8.7 million Tonogold common shares at an average price of $ 0.37 per share for gross proceeds of $ 2.9 million (plus a $ 0.2 million related receivable).and realized a gain of $ 1.5 million.

At December 31, 2020, the Company held 13.1 million Tonogold common shares with a fair value of $ 3.9 million.

The fair value of the common shares is based on the $ 0.30 closing share price (OTC:

TNGL) on December 31, 2020 (Note 15).

During the year ended December 31, 2020, the Company recognized a gain on the change in fair value of the common shares of $ 1.6 million.

Tonogold Note Receivable - The consideration received for Tonogold's acquisition of Comstock LLC included a note receivable (the "Note").

The Note had an initial principal balance of $ 5,475,000 when the Note was issued on March 20, 2020.

The outstanding principal balance was $ 4,475,000 when the Purchase Agreement closed on September 8, 2020.

The Note has an interest rate of 12 % per annum, with interest payable monthly.

The outstanding principal balance is due on September 20, 2021, unless extended by the Company (Note 15).

The fair value of the Note on September 8, 2020 and December 31, 2020 was $ 6.1 million and $ 5.5 million, respectively.

During the year ended December 31, 2020, the Company recognized a loss on the change in fair value of the Note of $ 0.6 million.

Contingent Forward - Upon its issuance on March 20, 2020 and prior to the close of the sale of Comstock LLC, the Note contained a contingent forward.

In evaluating the accounting for the Note, the Company determined upon issuance the Note represented a legal form debt, but should be evaluated and accounted for based on the substance of the arrangement rather than its legal form.

The Company concluded the Note contained a contingent forward for the Company’s right to sell its membership interests in Comstock LLC to Tonogold at a future date in exchange for cash consideration or common stock of Tonogold if certain options were elected (the “Contingent Forward”).

During 2020, Comstock Lucerne was deconsolidated as a result of completing the sale of the 100 % membership interest, which resulted in a decrease in additional paid in capital of $ 20,499,141 and elimination of the non-controlling interest of $ 313,854 .

The Company recognized a loss on the change in fair value of the CPS of $ 2,544,000 during the year ended December 31, 2020.

During 2020, the Company elected to convert a portion of the CPS with a face value of $ 3.9 million at $ 0.18 per common share, for a total of 21.8 million Tonogold common shares.

On October 2, 2020, Tonogold redeemed a $ 2.2 million portion of the CPS for $ 2.6 million in cash, representing 120 % of face value.

During the year ended December 31, 2020, the Company sold approximately 5.3 million Tonogold common shares at an average price of $ 0.3957 per share for gross proceeds of $ 2,944,929 .

During the year ended December 31, 2021, the Company sold approximately 4.3 million Tonogold common shares at an average price of $ 0.1865 per share for gross proceeds of $ 798,313 .

The Tono Note had an outstanding principal balance of $ 6,650,000 and $ 4,475,000 at December 31, 2021 and 2020, respectively.

The Tono Note bears interests 12 % per annum, payable monthly in arrears, and matures on March 31, 2022, unless extended by the Company (see Note 15, Fair Value Measurements ).

The fair value of the Tono Note on December 31, 2021 and December 31, 2020 was $ 7,255,000 and $ 5,498,500 , respectively.

During the years ended December 31, 2021 and 2020, the Company recognized a loss on the change in fair value of the Tono Note of $ 418,500 and $ 642,997 , respectively.

As of the amendment date in March 2020, the Company concluded the Tono Note contained a contingent forward for the Company’s right to sell its membership interests in Comstock Lucerne to Tonogold at a future date in exchange for cash consideration or common stock of Tonogold if certain options were elected (the “Contingent Forward”).

The Company identified the Contingent Forward as a derivative which was adjusted to fair value at the end of each reporting period.

On March 20, 2020, the Company recorded the $ 1.2 million initial fair value of the Contingent Forward asset in additional paid in capital on the consolidated balance sheets as Tonogold, a related party at the time, owned 50 % of the membership interests of Comstock LLC.

The fair value of the Contingent Forward asset on September 8, 2020 was $ 2.0 million, and was an offset against the consideration received for the sale of Comstock LLC recorded on that date.

Upon closing of the Purchase Agreement, the contingencies were eliminated, and the Note was recorded as a current asset on the consolidated balance sheets.

During the year ended December 31, 2020, the Company recognized a gain for the change in fair value of the Contingent Forward of $ 765,880 (Note 15).

Mineral Exploration and Mining Lease for Storey County Properties

On September 16, 2019, as amended and restated on December 23, 2019, the Company, as lessor, entered into a 10-year , renewable mineral exploration and mining lease with Tonogold for certain mineral properties owned or controlled by the Company in Storey County, Nevada (the "Exploration Lease").

The Exploration Lease grants Tonogold the right to use these properties for mineral exploration and development, and ultimately the production, removal and sale of minerals and certain other materials.

Tonogold pays to the Company a quarterly lease fee of $ 10,000 .

The lease fee will escalate 10 % each year on the anniversary date of the Exploration Lease.

Tonogold also reimburses the Company for all costs associated with owning the properties, including, but not limited to, lease payments for underlying, third-party leases.

The Exploration Lease also provides for royalty payments when mining operations commence.

For the first year following the commencement of mining, royalties will be paid to the Company at the rate of 3.0 % of NSR for the properties.

The rate will be reduced to 1.5 % of NSR thereafter.

Lease Option Agreement for the American Flat Processing Facility

On November 18, 2019, the Company, as lessor, entered into an agreement to lease its permitted American Flat property, plant and equipment to Tonogold for crushing, leaching and processing material from the Lucerne Mine (the "Lease Option Agreement").

Under the Lease Option Agreement, Tonogold is required to reimburse the Company approximately $ 1.1 million in expenses per year to maintain the option.

If the option is exercised, Tonogold will then pay the Company a rental fee of $ 1.0 million per year plus $ 1 per processed ton up to and until the first $ 15.0 million in rental fees are paid to the Company, and then stepping down to $ 1.0 million per year plus $ 0.50 per processed ton for the next $ 10.0 million paid to the Company.

The Lease Option Agreement remains in effect, but has not yet been exercised.

The Lease Option Agreement expires in November 2025.

Reimbursements

Total reimbursements under the three Tonogold agreements, including but not limited to all costs associated with owning the properties, lease and option payments and lease income for the years ended December 31, 2020 and 2019 were $ 2.9 million and $ 2.2 million, respectively.

Mercury Clean Up LLC Pilot and Joint Venture Agreements

The MCU Agreement

On March 20, 2020, the Company recorded the $ 1,232,952 initial fair value of the Contingent Forward asset in additional paid in capital on the consolidated balance sheets as Tonogold, a related party at the time, owned 50 % of the membership interests of

Comstock Lucerne.

The fair value of the Contingent Forward asset on September 8, 2020 was $ 1,998,832 and was an offset against the consideration received for the sale of Comstock Lucerne recorded on that date.

Upon closing of the Lucerne Purchase Agreement, the contingencies were eliminated.

During the year ended December 31, 2020, the Company recognized a gain for the change in fair value of the Contingent Forward of $ 765,880 (see Note 15, Fair Value Measurements ).

At December 31, 2021, the Company was in direct and continuing discussions with Tonogold management with the intention of exchanging the Note for Comstock Lucerne plus an option for Tonogold to acquire Comstock Lucerne in the future (see Note 22, Subsequent Events ).

Investment in Mercury Clean Up LLC

On June 21, 2019, as amended July 3, 2019, April 10, 2020 and December 4, 2020, the Company entered into a Mercury Remediation Pilot, Investment and Joint Venture Agreement (the “MCU Agreement”) with MCU.

2 unchanged sentences

Completing $ 2.0 million of such financing entitles the Company to an additional 10 % of the fully-diluted membership interests of MCU.

MCU Investment

Cash - The Company made cash payments to MCU of $ 750,000 during 2019, and $ 400,000 during 2020, bringing the total to $ 1.15 million in cash and satisfying the required cash contribution.

Shares of Common Stock - The MCU Agreement contains a provision whereby the Company is required to issue additional shares of its common stock for the make whole difference between the value of the Company's common shares received by MCU and the required stock-based investment of $ 850,000 .

The Company has made cash payments to MCU of $ 1,150,000 in cash and satisfying the required cash contribution.

The MCU Agreement contained a provision whereby the Company is required to issue additional shares of its common stock for the make whole difference between the value of the Company's common shares received by MCU and the required stock-based investment of $ 850,000 .

On July 18, 2019, the Company issued 900,000 shares of restricted common stock with a fair value of $ 751,050 to fund the MCU capital contribution.

7 unchanged sentences

The December 4, 2020 third amendment to the MCU Agreement clarified the provision that when MCU sells its remaining 625,000 shares of the Company’s common stock, the Company is entitled to the portion of the proceeds that is in excess of its original required contribution.

See MCU Derivative Asset below.

MCU Philippines Inc.

During January and February 2021, MCU sold the 625,000 common shares for net proceeds of $ 1.1 million, resulting in a $ 0.8 million excess contribution, which was paid to us in February 2021 (see Note 15, Fair Value Measurements ).

For the year ended December 31, 2021 and 2020, respectively, the Company recorded $ 35,086 and $ 1,767 in equity loss from affiliates for the investment in MCU.

Investment in MCU Philippines, Inc.

On April 10, 2020, the Company entered into a second amendment of the MCU Agreement, wherein MCU and the Company have identified an opportunity to remediate mercury in the Philippines, specifically in the province of Davao d' Oro (the “Philippine Opportunity”).

2 unchanged sentences

On December 4, 2020, the Company became fully entitled to 50 % participation in the Joint Ventures and was issued 50 % of the common stock of MCU-P.

During 2020, the Company made cash loans of $ 1.2 million, in the form of senior secured interest free loans, and committed up to another $ 1.8 million in secured loans.

During 2020, the Company made cash loans of $ 1,180,000 , in the form of senior secured interest free loans, and committed up to another $ 1.8 million in secured loans.

When the Company's loans to MCU-P reach $ 2.0 million, the Company will receive an additional 10 % membership interest in MCU.

8 unchanged sentences

The investment is accounted for under the equity method.

MCU Derivative Asset

As part of the 15 % membership interests purchase price, in May 2020, the Company issued 625,000 shares of its common stock to MCU.

As of December 31, 2020, the fair value of these shares in excess of the $ 2.0 million purchase price (less $ 1,150,000 of cash payments to and $ 465,127 of proceeds from sales of common shares previously issued to MCU by the Company) is expected to be paid by MCU to MCU-P on behalf of the Company as an additional senior secured interest free loan due December 31, 2024.

The Company has recognized this right as a derivative asset that had a fair value of $ 271,377 on December 4, 2020.

As a derivative asset, its carrying value is adjusted to fair value each reporting period end with the resulting gain (loss)

recognized in the consolidated statements of operations.

The fair value of the derivative asset at December 31, 2020 is $ 265,127 and is a current asset on the consolidated balance sheets.

A loss on the change in fair value of $ 6,250 was recognized during the year ended December 31, 2020 (Note 15).

Pelen Limited Liability Company Membership Interest

Investment in Pelen Limited Liability Company Membership Interest

Pelen owns 100 % of the historic Sutro Tunnel Company ("Sutro") which, in turn, owns the Sutro townsite, the historic 6-mile Sutro Tunnel, the federal land grants and mining rights extending 1,000 feet on each side of the 6-mile tunnel, the rights to the tunnel’s water, and patented mining claims and private lands on Gold Hill.

In January 2018, the Company issued 295,082 shares of restricted common stock as initial payment to acquire 25 % of the total membership interests of Pelen.

If all of the shares of restricted common stock had been sold by the seller of the membership interests and the aggregate proceeds received were less than $ 0.6 million, then the Company was required to pay the make whole liability shortfall in either additional shares of the Company’s common stock or cash, at the Company’s election.

In August, September and October 2018, the original 295,082 shares of restricted common stock were sold for total proceeds of $ 236,476 .

In November 2018, the Company issued 351,637 shares of restricted common stock based on the make whole liability shortfall resulting from the aggregate sales proceeds for the initial shares.

In December 2019, the agreement was amended to revise the cut-off date for closing the transaction to March 31, 2020.

On April 24, 2020, the Company completed the acquisition of 25 % of the total membership interests of Pelen.

The total purchase price paid since 2018 of $ 602,500 (including shares with fair value of $ 585,000 on date of issuance and $ 17,500 paid in cash), has been recorded as investment in Pelen Limited Liability Company, a non-current asset on the consolidated balance sheets.

The investment is accounted for under the equity method.

In addition, in connection with the investment, $ 197,943 of cash payments were made against the make whole liability and $ 31,190 of cash payments were made in connection with interest expense during 2019 and 2020.

Accrued Make Whole for Pelen Limited Liability Company

The agreement with the member from whom the Company acquired the 25 % interest contained a provision whereby the Company was required to issue additional shares of its common stock for the make whole difference between the valuation of the Company's common shares received by the member and the required stock-based investment.

The accrued make whole was valued based on the difference between the valuation of the outstanding shares held by the seller of the Pelen membership interests at the volume-weighted average price per share for five consecutive trading days preceding the date of determination.

At December 31, 2019, the make whole liability was $ 0.2 million based on the Company's closing price per share of common stock of $ 0.47 , as compared to the remaining aggregate proceeds due.

In April 2020, the Company completed the purchase of 25 % of the membership interests in Pelen, settling all remaining amounts due.

No make whole accrual remains on the consolidated balance sheets at December 31, 2020.

Tonogold reimbursed $ 234,934 of costs associated with the Pelen investment.

For the years ended December 31, 2020 and 2019, the changes in fair value of the make whole liability of $ 24,659 and $( 87,439 ), respectively, were recorded in other income (expense) in the consolidated statements of operations.

Purchase Option for Pelen Limited Liability Company

On September 1, 2020, the Company paid $ 100,000 for a one-year option to purchase the remaining 75 % of the membership interests of Pelen (the "Option"), for a purchase price of $ 3,750,000 .

The Option can be extended for a second year for an additional option fee of $ 100,000 , with the purchase price increased to $ 4,400,000 ;

and can be extended for a third year for another additional option fee of $ 100,000 , with the purchase price increased again to $ 5,000,000 .

If the Option is exercised, half of all option payments will be credited to the purchase price.

The $ 100,000 option payment is included in prepaid expenses and other current assets on the consolidated balance sheets at December 31, 2020.

Sutro Tunnel Company Mineral Exploration and Mining Lease

On September 1, 2020, the Company entered into a new mineral exploration and mining lease with Sutro, 100 % owned by Pelen.

The lease covers patented mining claims, exploration rights, and access over and through town lots in Gold Hill and Virginia City, Nevada.

The lease also provides the right to explore the Sutro Tunnel.

The previous lease with Sutro expired December 31, 2017, and had been extended on a month-to-month basis.

Sierra Springs Opportunity Fund Inc.

At December 31, 2020, the net balance of the note receivable was $ 860,940 .

On March 5, 2021, we loaned an additional $ 820,000 to MCU-P, increasing the face value of the non-interest-bearing note receivable to $ 2,000,000 .

Implied interest of $ 189,337 for the additional loan increased the value of our investment in MCU-P.

The discounted present value was calculated using a rate of 7.1 %, which was based on the alternative borrowing cost of MCU-P, considering market data for companies with comparable credit ratings.

The additional loan amount resulted in our ownership interest in MCU increasing from 15 % to 25 %.

At December 31, 2021, the net balance of the note receivable is $ 1,598,841 which is recorded on the consolidated balance sheets in notes receivable and advances, net.

For the years ended December 31, 2021 and 2020, we recognized implied interest income of $ 107,239 and $ 5,074 , respectively.

The note receivable matures on December 31, 2024.

For the year ended December 31, 2021 and 2020, respectively, the Company recorded $ 13,838 and $ 364 in equity loss from affiliates for the investment in MCU-P.

Investment in Sierra Springs Opportunity Fund, Inc.

During 2018 and 2019, Comstock’s Board of Directors approved the Company entering into an investment in a certain opportunity zone fund in northern Nevada.

During 2019, Comstock invested $ 335,000 into a qualified opportunity zone fund Sierra Springs Opportunity Fund, Inc.

("SSOF") and a qualified opportunity zone business Sierra Springs Enterprises, Inc.

("SSE"), which is wholly owned by SSOF.

The Company expects to own approximately 9 % of SSOF upon issuance by SSOF of 75.0 million authorized shares to investors.

The Company owns 12.1 % of SSOF as of December 31, 2020.

As of December 31, 2020, SSOF has received $ 11.6 million in equity from investors, including $ 0.3 million from the Company and $ 0.5 million ( 16.5 % ownership) from officers and directors of the Company, including the Company's chief executive officer, who owns 16.2 % of SSOF.

The Company’s chief executive officer is the president and a director of SSOF and an executive and a director of SSE.

Comstock’s $ 335,000 investment in SSOF is recorded on the consolidated balance sheets at December 31, 2020 and 2019, as Investment in Sierra Springs Opportunity Fund, Inc., a non-current asset.

The investment is accounted for at cost less impairment because there is no ready market for the investment units.

During 2019, the Company invested $ 335,000 into a qualified opportunity zone fund, Sierra Springs Opportunity Fund ("SSOF") which owns Sierra Springs Enterprises, Inc.

("SSE"), a qualified opportunity zone business.

We expect to own 9 % of SSOF upon issuance by SSOF of all 75 million authorized shares to investors.

At December 31, 2021, our $ 335,000 investment in SSOF and 6,700,000 voting shares represent 12 % of total as converted SSOF common shares .

The SSOF investment is accounted for at cost less impairment because there is no ready market for the investment units and is recorded to non-current investments on the consolidated balance sheets.

Management identified no events or changes in circumstances that might have had a significant adverse effect on the carrying value of the investment.

Management concluded it was impractical to estimate fair value due to the early stages of the fund and the absence of a public market for its stock.

Silver Springs Properties

On September 26, 2019, as amended on November 30, 2019, December 26, 2019, March 31, 2020, June 30, 2020, October 1, 2020, and December 30, 2020, the Company entered into agreements with SSE to sell the Company's two Silver Springs Properties.

The agreements include the sale of 98 acres of industrial land and senior water rights for $ 6.5 million and 160 acres of commercial land along with its rights in the membership interests in DTSS for $ 3.6 million.

Accordingly, the properties are classified as assets held for sale on the consolidated balance sheets at December 31, 2020 and 2019.

On December 9, 2019, the Company purchased 100 % of the membership interests in DTSS, including 160 acres of centrally located land in Silver Springs, Nevada, and related approvals for a commercial downtown development.

The DTSS acquisition was accounted for as an asset acquisition, as DTSS did not meet the definition of a business.

The Company paid total consideration of $ 4.1 million consisting of $ 3.1 million cash payments toward the purchase price of the land parcel, $ 0.5 million in interest and closing costs and, $ 0.5 million cash payments to the former membership interest holders of DTSS.

Based on the agreement with SSE to sell the Silver Springs Properties, the carrying value of the land was adjusted to the contract value of $ 3.6 million less estimated costs to sell, resulting in an impairment of $ 0.5 million, charged to other expense in the consolidated statements of operations for the year ended December 31, 2019.

As of December 31, 2020, the Company has received deposits in cash and escrow from SSE totaling $ 0.4 million and $ 0.3 million towards the purchase of the Silver Springs Properties, recorded in deposits under current liabilities on the consolidated balance sheets.

The transactions are expected to close during 2021.

Advance to Sierra Springs Opportunity Fund Inc.

As of December 31, 2020, the Company had advanced SSOF $ 1.65 million to be used by SSOF for deposits and payments on land and other facilities related to investments in qualified businesses in the opportunity zone.

The advances are non-interest-bearing and are expected to be repaid during 2021, upon the sale of the Company’s Silver Springs Properties to SSE.

The Company made no such advances in 2019.

As of December 31, 2020, the advances totaling $ 1.65 million are included on the consolidated balance sheets in Notes receivable and advances, net.

Notes Receivable and Advances, Net

The Company additionally provided SSOF with a total of $ 4,935,000 (“SSOF Advances”), including $ 3,285,000 and $ 1,650,000 provided during the years ended December 31, 2021, and 2020, respectively to be used by SSOF for deposits and payments on land and other facilities related to investments in qualified businesses in the opportunity zone.

The advances are non-interest-bearing and are expected to be repaid on or before the sale of our Silver Springs Properties to SSE during the first half of 2022 ( see Note 4, Assets Held for Sale ).

The $ 4,935,000 of advances are recorded on the consolidated balance sheets at December 31, 2021 in notes receivable and advances, net.

The Company’s executive chairman and chief executive officer co-founded SSOF and SSE, and serves as the chief executive officer of SSOF and as an executive of SSE along with a diverse team of qualified financial, capital markets, real estate and operational professionals that together govern, lead and manage SSOF and SSE.

The $ 450,000 investment and 9,000,000 voting shares of our CEO and two of our directors represent 16.4 % of total as converted SSOF common shares.

The Company's executive chairman and chief executive officer has not received compensation of any kind from either SSOF or SSE.

NOTE 3 NOTES RECEIVABLE AND ADVANCES, NET

Notes receivable and advances, net at December 31, 2021 and 2020 include:

12/31/21 12/31/20

Current portion

Tonogold note receivable, face value $ — $ 4,475,000

Estimated fair value adjustments 1,023,500 —

Tonogold note receivable, fair value (Notes 2 and 15) 5,498,500 —

SSOF advances receivable (Note 2) 1,650,000 —

Total notes receivable and advances, net - current portion $ 7,148,500 $ —

Unrealized gain — 1,023,500

Tonogold note receivable, fair value — 5,498,500

Sierra Springs advances receivable 4,935,000 1,650,000

Other notes receivable 29,545 —

Total notes receivable and advances, current portion $ 4,964,545 $ 7,148,500

Non-current portion

Tonogold note receivable, face value 6,650,000 —

Unrealized gain 605,000 —

Tonogold note receivable, fair value 7,255,000 —

MCU-P note receivable, face value 2,000,000 1,180,000

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( 401,159 ) ( 319,060 )

MCU-P note receivable, fair value (Notes 2 and 15) - non-current 860,940 —

MCU-Philippines note receivable, non-current portion, net 8,853,841 860,940

Total notes receivable and advances, net $ 13,818,386 $ 8,009,440

Assets and Liabilities Held for Sale

The Company previously committed to a plan to sell certain land, buildings, and water rights.

As of December 31, 2020, and 2019, the Company had assets with a net book value of $ 6.3 million and $ 10.5 million, respectively, that met the criteria to be classified as assets held for sale.

Those criteria specify that the asset must be available for immediate sale in its present condition (subject only to terms that are usual and customary for sales of such assets), the sale of the asset must be probable, and its transfer expected to qualify for recognition as a completed sale generally within one year.

We expect the Tonogold Note to be cancelled in exchange for the membership interests of Comstock Mining LLC (see Note 22, Subsequent Events ), which investment is classified as a non-current asset at December 31, 2021.

NOTE 4 ASSETS HELD FOR SALE

The Company had classified the Silver Springs Properties as assets held for sale at December 31, 2020.

We previously committed to a plan to sell certain land and water rights.

On September 26, 2019, we entered into the Silver Springs Purchase Agreement with SSE, which calls for the sale by the Company to SSE of 98 acres of industrial land with senior water rights for $ 6,500,000 (“SSP Tract I”), and 160 acres of commercial land with Downtown Silver Springs LLC (“DTSS”) membership interest rights for $ 3,600,000 (“SSP Tract II”), for a total purchase price of $ 10,100,000 .

At December 31, 2021, we have received deposits in cash and escrow from SSE totaling $ 400,000 towards the purchase of the Silver Springs Properties, which is recorded in deposits under current liabilities on the Company’s consolidated balance sheets.

As a result of the delay in sale of the Silver Springs Properties, the Company was not certain the sale would occur within the next year, and the assets were reclassified to assets held for use and are included in properties, plant and equipment on the consolidated balance sheets at December 31, 2021.

Assets held for sale at December 31, 2021 and 2020 include:

12/31/21 12/31/20

Silver Springs Properties

DTSS (Land) $ 3,589,876 $ 3,589,876

Industrial Park (Land and water rights) 2,738,462 2,738,462

Daney Ranch (Land and buildings) (Note 10) — 2,146,575

Lucerne Mine (Mineral rights and properties) (Note 2) — 1,558,787

Gold Hill Hotel (Land and buildings) — 478,366

SSP Tract 1 $ — $ 3,589,876

SSP Tract II — 2,738,462

Total assets held for sale $ — $ 6,328,338

Liabilities held for sale at December 31, 2020, and 2019 include:

Lucerne Properties (reclamation liabilities) (Note 12) $ — $ 1,019,705

Total liabilities held for sale $ — $ 1,019,705

Assets Held for Sale - Silver Springs, Nevada

On September 26, 2019, as amended on November 30, 2019, December 26, 2019, March 31, 2020, June 30, 2020, October 1, 2020, and December 30, 2020, the Company entered into agreements with SSE, a subsidiary of SSOF (Note 2), to sell the two Silver Springs Properties.

The agreements include the sale of 98 acres of industrial land and senior water rights for $ 6.5 million, and 160 acres of commercial land along with its rights in the membership interests in DTSS for $ 3.6 million.

The carrying value of the 160 acres of commercial land and DTSS membership rights were adjusted to the contract value of $ 3.6 million less estimated costs to sell, resulting in an impairment of $ 0.5 million, charged to other expense in the consolidated statements of operations for the year ended December 31, 2019.

During 2020 and 2019, the Company received $ 0.1 and $ 0.3 million, respectively, in escrowed deposits from SSE for the sale of these assets and expects the sales to close in 2021.

Total deposits of $ 0.4 million and $ 0.3 million are included in deposits on the consolidated balance sheets as of December 31, 2020, and 2019, respectively.

Proceeds from the sale of the Silver Springs Properties must satisfy certain obligations due under the terms of the Promissory Notes (Note 11).

Properties No Longer Classified Held for Sale

The Company had classified the Daney Ranch as an asset held for sale at December 31, 2019.

On September 1, 2020, the Company, as lessor, entered into an agreement to lease the Daney Ranch for $ 9,000 per month, with lease payments applicable

to the purchase price through an option to purchase the property for $ 2.7 million, if closed by September 1, 2022.

The lease is extendable for a third year, with lease payments increasing to $ 10,000 per month, with only the last twelve months of lease payments applicable to the purchase price, if closed by September 1, 2023.

As a result of this agreement, the property was reclassified to an asset held for use and is included in properties, plant and equipment on the consolidated balance sheets at December 31, 2020.

Upon the change in classification, the Company recorded depreciation expense of $ 0.5 million included in real estate operating costs in the consolidated statements of operations, to recognize the depreciation that would have been recognized had the property not been held for sale.

On September 8, 2020, the Purchase Agreement with Tonogold closed (Note 2), and the Company transferred to Tonogold 100 % of the membership interests in Comstock LLC, the entity that owns the Lucerne Mine, resource area and related permits.

At that time, the associated assets and liabilities held for sale were removed from the consolidated balance sheets.

The Company had classified the Gold Hill Hotel as an asset held for sale at December 31, 2019.

On September 28, 2020, management decided to retain the Gold Hill Hotel as an income-producing property, and canceled its listing for sale.

As a result, the property was reclassified to an asset held for use and is included in properties, plant and equipment on the consolidated balance sheets at December 31, 2020.

Upon the change in classification, the Company recorded depreciation expense of $ 0.2 million included in real estate operating costs in the consolidated statements of operations, to recognize the depreciation that would have been recognized had the property not been held for sale.

Prepaid Expenses and Other Current Assets

NOTE 5 PREPAID EXPENSES AND OTHER CURRENT ASSETS

Prepaid expenses and other current assets at December 31, 2021 and 2020 consisted of the following:

Land and property deposits $ 12,600 $ 10,100

Insurance 139,527 110,558

Receivable on sale of investment in equity securities

Purchase option for 75 % membership interest in Pelen LLC (Note 2)

Deposit for Mercury Clean Up LLC (Note 2) — 1,501,050

12/31/21 12/31/20

Accounts receivable - service income $ 25,944 $ —

Accounts receivable - Tonogold reimbursements 407,127 —

Accrued interest receivable 487,651

Surety bond and insurance 229,124 139,527

Receivable on sale of equity securities — 200,000

Other 187,137 195,951

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On December 23, 2020, the Company transferred 3,333,333 Tonogold common shares to Wingfield for total proceeds of $ 1.1 million.

As of December 31, 2020, the Company had received $ 0.9 million and recorded a receivable of $ 0.2 million on the consolidated balance sheets in connection with the first closing under the securities purchase agreement.

Mineral Rights and Properties, Net

Mineral rights and properties at December 31, 2020, and 2019 consisted of the following:

Dayton resource area $ 2,932,226 $ 2,932,226

Spring Valley area 910,000 810,000

Oest area 260,707 260,707

Occidental area 1,002,172 1,002,172

Northern extension 157,205 157,205

Northern targets 121,170 121,170

At December 31, 2020, the Company had received $ 0.9 million in connection with the securities purchase agreement.

The remaining $ 200,000 was a receivable as of December 31, 2020.

On April 13, 2021, Wingfield returned 606,601 of the Tonogold common shares previously transferred under the Wingfield securities purchase agreement.

The return of the shares eliminated a $ 200,000 receivable from Wingfield and terminated the securities purchase agreement.

Deposits at December 31, 2021 and 2020 consisted of the following:

12/31/21 12/31/20

Security deposits $ 5,399 $ —

Land and property deposits 40,100 42,600

Pelen option 200,000 100,000

Vendor deposits 101,955 3,000

Total deposits, current 347,454 145,600

Vendor deposits, non-current 3,219,607 —

Total $ 3,567,061 $ 145,600

At December 31, 2021, LINICO had $ 3,219,607 in deposits with various vendors for the plant and equipment which have been classed as non-current deposits on the consolidated balance sheet.

On September 1, 2020, we paid $ 100,000 for a one-year option to purchase 75 % of the membership interests of Pelen LLC ("Pelen") not owned by the Company for a purchase price of $ 3,750,000 .

On August 26, 2021, we paid an additional $ 100,000 for a one-year extension of the option increasing the purchase price to $ 4,400,000 .

NOTE 6 PROPERTY, PLANT AND EQUIPMENT, NET AND MINERAL RIGHTS

Properties, plant and equipment at December 31, 2021 and 2020, respectively, include the following:

12/31/21 12/31/20

Land $ 6,328,338 $ —

Real property leased to third parties 3,298,311 3,298,311

Property, plant and equipment for mineral processing 27,644,745 27,644,744

Other property and equipment 4,438,657 4,367,229

Accumulated depreciation ( 27,146,379 ) ( 26,685,584 )

Total property, plant and equipment, net $ 14,563,672 $ 8,624,700

During the years ended December 31, 2021 and 2020, the Company recognized depreciation expense of $ 0.5 million and $ 1.2 million, respectively.

Mineral Rights and Properties

Comstock and its subsidiaries own, control, or retain an interest in 9,358 acres located in Storey and Lyon Counties, Nevada, just south of Virginia City, Nevada (referred to collectively herein as the “Comstock Mineral Estate”), including 2,396 acres of patented claims and surface parcels, approximately 6,962 acres of unpatented claims administered by the BLM, five mineral leases, one joint venture (providing exclusive rights to exploration, development, mining and production), royalty interests, and fee ownership of real property, including 126 patented and 392 unpatented mineral lode claims, as well as 39 unpatented placer claims.

Our properties at December 31, 2021 and December 31, 2020 consisted of the following:

12/31/21 12/31/20

Comstock Mineral Estate $ 6,261,706 $ 6,190,239

Other mineral properties 317,405 317,405

1 unchanged sentence

Total mineral rights and properties $ 6,669,111 $ 6,597,644

These mineral rights and properties are segmented based on the Company’s identified mineral resource areas and exploration targets.

During the years ended December 31, 2020 and 2019, the Company did no t recognize any depletion expense as none of the properties are in operation.

On February 25, 2020 and September 17, 2020, the Company sold two patented mining claims and five unpatented mining claims (the "Wild Horse" properties) and eight unpatented mining claims (the "Como Comet" properties), respectively, to Hercules Gold USA LLC ("Hercules") for a total purchase price of $ 100,000 and 100,000 shares of common stock of Eclipse Gold Mining Corporation (the parent company of Hercules), with a fair value of $ 52,000 , plus a 2 % NSR royalty on future mineral production from these properties.

Hercules has the option to purchase the royalty for $75,000 for each one percent (1%) per each patented or unpatented claim.

Since the Wild Horse and Como Comet properties had no recorded carrying value, the entire purchase price represented a total gain of $ 152,000 recorded in other income in the consolidated statements of operations for the year ended December 31, 2020.

On May 5, 2020, the Company, as lessee, renewed a lease with Fred Garrett et al.

for one patented mining claim located in Storey County, Nevada.

The new lease terms provide for a five-year Exploration Term followed by a 15 -year Development Term.

The lease remains in effect as long as exploration, development, mining, or processing operations are being conducted on a continuous basis, without a lapse of activity for more than 180 days.

The lease fee is $ 250 per month, increasing to $ 1,000 per month when all permits for placing the property into production have been obtained.

On May 21, 2020, the Company exercised its option with New Daney Company Inc.

("New Daney") to purchase seven unpatented lode mining claims located in Spring Valley, Nevada, south of the Company's Dayton resource area.

These claims have been leased from New Daney since 2010.

The claims were purchased for a total of $ 100,000 , inclusive of a 3 % NSR royalty.

The Company paid $ 10,000 upon signing, five payments of $ 1,000 and a final payment of $ 85,000 on October 8, 2020.

The total purchase price is recorded in mineral rights and properties, net on the consolidated balance sheets as of December 31, 2020.

On July 9, 2020, the Company, as lessee, amended a lease with Renegade Mineral Holdings, LLC for 26 unpatented mining claims in the area of our Occidental exploration target.

Under the terms of the amendment, the Additional Term was lengthened to ten years , and an optional 10-year Second Additional Term was added, which would extend the lease through September 30, 2039.

The lease payment remains $ 2,250 per quarter, and will increase to $ 3,000 per quarter in the Second Additional Term.

The work commitment was increased to $ 250,000 by September 30, 2021, and a cumulative $ 500,000 by September 30, 2023.

On September 1, 2020, the Company entered into a new mineral exploration and mining lease with the Sutro (a related party through the Company's 25 % interest in Pelen, owner of Sutro).

The lease covers patented mining claims, exploration rights, and access over and through town lots in Gold Hill and Virginia City, Nevada.

The lease also provides the right to explore the Sutro Tunnel.

The previous lease with Sutro expired December 31, 2017, and had been extended on a month-to-month basis.

The new Sutro lease provides the right to explore, develop, and mine all minerals on or in the property, including surface dumps.

The lease is for a term of five years , with automatic renewals for an additional ten years , and then continues thereafter for so long as operations continue on the property, or on a month-to-month basis so long as the Company continues to make the monthly rental payments, unless explicitly terminated.

The rental payment is $ 5,000 per month for the first five years , increasing to $ 10,000 per month and then $ 15,000 per month in the second and third five-year periods, respectively.

During the extended period after the first fifteen years , the rental payment increases to $ 20,000 per month.

Total mineral lease payments to Sutro were $ 26,000 and $ 12,000 for the years ended December 31, 2020 and 2019, respectively.

All the Company's mineral exploration and mining lease payments are classified as costs applicable to mining in the consolidated statements of operations.

Properties, Plant and Equipment, Net

Properties, plant and equipment at December 31, 2020 and 2019, consisted of the following:

Land and building $ 12,186,090 $ 9,140,805

Vehicle and equipment 2,267,916 2,267,916

Processing and laboratory 21,113,177 21,113,177

Furniture and fixtures 549,860 549,860

36,117,043 33,071,758

Less accumulated depreciation ( 26,685,584 ) ( 25,136,737 )

Total properties, plant and equipment $ 9,431,459 $ 7,935,021

For each of the years ended December 31, 2020 and 2019, the Company recognized depreciation expense of $ 1.2 million and $ 1.8 million, respectively.

This included $ 0.7 million of depreciation, included in real estate operating costs for the year ended December 31, 2020, for the Gold Hill Hotel and Daney Ranch properties, to recognize the depreciation that would have been recognized had the properties not been held for sale (Note 4).

As of December 31, 2020 and 2019, land and building leased to others was $ 2,101,887 and $ 208,162 , respectively, which was net of accumulated depreciation of $ 1,196,425 and $ 75,615 , respectively.

Reclamation Bond Deposit

The Comstock Mineral Estate is partitioned for management purposes based on identified resource areas and exploration targets.

During the years ended December 31, 2021 and 2020, we did not record any depletion expense, as none of the properties are in production.

All of our mineral exploration and mining lease payments are classified as mining and mining claims costs and expenses in the consolidated statements of operations.

NOTE 7 RECLAMATION BOND DEPOSIT

The Nevada Revised Statutes and Regulations require a surety bond to be posted for mining projects so that after the completion of such mining projects the sites are left safe, stable and capable of productive post-mining uses.

The bond is intended to cover the estimated costs required to safely reclaim the natural environment to the regulatory standards established by the State of Nevada’s Division of Environmental Protection.

Accordingly, the Company has a $ 6.8 million reclamation surety bond through the Lexon Surety Group (“Lexon”) with the State of Nevada’s Bureau of Mining Regulation and Reclamation as of December 31, 2020.

In addition, the Company has a $ 0.5 million surety bond with Storey County related to mine reclamation as of December 31, 2020.

The Company also has a $ 0.5 million surety bond with Storey County for mine reclamation at December 31, 2021.

As part of the surety agreement, the Company agreed to pay a 2.0 % annual bonding fee.

The total cash collateral, per the surety agreement, was $ 2.6 million at December 31, 2021, and 2020.

The total cash collateral is a component of the reclamation bond deposit on the consolidated balance sheets.

The reclamation bond deposit at December 31, 2021 and 2020 consisted of the following:

12/31/21 12/31/20

Lexon surety bond cash collateral 2,589,008 2,588,768

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The Lexon collateral at December 31, 2021 and 2020 includes earned income of $ 89,009 and $ 88,768 respectively, which has been left on deposit at BNY Mellon.

Accrued Expenses and Other Liabilities

The total cash collateral is a component of the reclamation bond deposit on the consolidated balance sheets at the years ended December 31, 2021 and 2020.

NOTE 8 INTANGIBLE ASSETS AND GOODWILL

The Company’s intangible assets at December 31, 2021 and 2020 include the following:

Description Estimated Economic Life December 31, 2021 December 31, 2020

Developed technologies 10 years $ 18,882,401 $ —

Lease intangible 30 years 3,621,488

License agreements 10 years 510,752 —

In-process research and development 10 years 350,000

Customer agreements 1 year 122,885 —

Distribution agreements 8 years 19,733 —

Trademarks 10 years 7,000

Accumulated amortization ( 338,958 ) —

Intangible assets, net $ 23,175,301 $ —

Accumulated amortization as of December 31, 2021 and 2020 consisted of the following:

December 31, 2021 December 31, 2020

Developed technologies $ 231,920 $ —

License agreements 20,625 —

In-process research and development 2,991 —

Customer agreements 81,923 —

Distribution agreements 1,499 —

Accumulated amortization $ 338,958 $ —

Amortization expense related to intangible assets of $ 569,721 was recorded for the year ended December 31, 2021.

Accumulated amortization of $ 230,763 was written off as part of the impairment of the MANA customer agreement intangible asset during the year ended December 31, 2021.

The estimated economic lives shown above were at the closing dates of the respective acquisitions.

The estimated economic lives of license agreements and developed technologies are based on the midpoint of the indicated lives derived from the related valuation analyses.

The estimated economic lives of customer and distribution agreements are based on the specified terms of the respective agreements.

The Company is party to three license agreements with American Science and Technology Corporation (“AST”), pursuant to which Comstock Innovations agreed to license AST’s intellectual properties for use at three facilities in exchange for three facility-specific license fees of $ 500,000 each, and a royalty fee equal to 1.0 % of the gross revenue of each of the first three licensed facilities.

Comstock IP Holdings is also party to a research agreement with Virginia Polytechnic Institute and State University (“Virginia Tech”), and an exclusive license agreement with Virginia Tech’s affiliate, Virginia Tech Intellectual Properties, Inc.

(“VTIP”) pursuant to which Comstock IP Holdings agreed to (i) pay Virginia Tech $ 438,410 to conduct sponsored research;

and (ii), license VTIP’s related intellectual property on a worldwide exclusive basis in exchange for a royalty fee equal to 1.0 % of the applicable net sales, subject to a minimum annual royalty of $ 5,000 per year.

The Company also has developed technologies valued at $ 18,882,401 (See Note 2, Acquisitions and Investments ).

Amortization of intangible assets was $ 338,958 for the year ended December 31, 2021.

Future minimum amortization expense is as follows at December 31, 2021:

2022 $ 2,148,222

2023 2,103,108

2024 2,098,956

2025 2,098,956

2026 2,098,956

Thereafter 12,627,103

Changes in the intangible assets and goodwill balances for the year ended December 31, 2021 are presented below:

As of December 31, 2020 Acquisitions Additions Impairment Amortization As of December 31, 2021

Intangible assets — 23,125,786 850,000 ( 461,527 ) 23,514,259

Accumulated amortization — — 230,763 ( 569,721 ) ( 338,958 )

Goodwill — 18,952,517 — ( 6,163,846 ) — 12,788,671

Total intangible assets and goodwill — 42,078,303 850,000 ( 6,394,610 ) ( 569,721 ) 35,963,972

All intangibles and goodwill are associated with the Renewable Energy Products segment.

NOTE 9 ACCRUED EXPENSES AND OTHER LIABILITIES

Accrued expenses and other liabilities at December 31, 2021, and 2020, consisted of the following:

Accrued make whole for MCU (Note 2) $ — $ 452,740

12/31/21 12/31/20

Accrued interest expense 12,329 —

1 unchanged sentence

Accrued payroll costs 817,062 153,615

Accrued make whole for Pelen LLC — 222,602

Accrued board of directors' fees 60,000 120,000

Accrued directors fees — 60,000

Accrued vendor liabilities 77,062 136,499

1 unchanged sentence

Total accrued expenses $ 939,443 $ 534,947

The Northern Comstock LLC operating agreement between the Company and other members of Northern Comstock LLC, a related party (Note 21), requires the Company to make monthly cash payments of $ 30,000 and an annual capital contribution in the amount of $ 482,500 in stock or cash.

In addition to the balance accrued for Northern Comstock LLC in the table above, the Company has a long-term liability to Northern Comstock LLC in the amount of $ 413,956 and $ 476,048 recorded in other liabilities on the consolidated balance sheets as of December 31, 2020 and 2019, respectively.

The long-term liability is being amortized over the term of the agreement, which expires September 1, 2027.

Lease Expense

NOTE 10 LEASES

The Company has the following lease balances recorded on the consolidated balance sheets as follows:

Lease Assets and Liabilities Classification December 31, 2021 December 31, 2020

Finance lease right-of-use asset Right of use asset $ 15,033,000 $ —

Operating lease right-of-use asset Other assets 46,897 51,294

Total right of use assets $ 15,079,897 $ 51,294

Operating lease liability - current Accrued expenses and other liabilities $ 4,388 $ 3,650

Operating lease liability - long-term Other liabilities 45,403 49,791

Finance lease liability Lease liability 13,043,499 $ —

Total lease liabilities $ 13,093,290 $ 53,441

The Company has the following lease costs recorded in the consolidated statements of operations as follows:

Year Ending December 31,

Finance lease cost:

Amortization of right-of-use assets $ — $ —

Interest on lease liabilities — —

Operating lease cost 10,099 10,099

Total lease cost $ 10,099 $ 10,099

Other information

Cash paid for amounts included in the measurement of lease liabilities $ — $ —

Operating cash flows from finance leases — —

Operating cash flows from operating leases 9,350 9,050

Financing cash flows from finance leases — —

Right-of-use assets and finance lease liabilities acquired with LINICO transaction (Note 2) 15,033,000 —

Weighted-average remaining lease term - finance leases 0.75 —

Weighted-average remaining lease term - operating leases 6.75 7.75

Weighted-average discount rate - finance leases 6 % — %

Weighted-average discount rate - operating leases 11 % 11 %

Finance Lease

On February 15, 2021, LINICO Corporation (“LINICO”) and Aqua Metals Reno Inc.

(the “Landlord”), a subsidiary of Aqua Metals Inc.

(“AQMS”), entered into an industrial lease (the “AQMS Lease Agreement”), for the land, buildings and related improvements (the “Battery Recycling Facility”).

The AQMS Lease Agreement is for a two-year term and commences on April 1, 2021, and provides for lease payments of $ 68,000 per month during months 1 to 12, $ 81,600 per month during months 13 to 18 and $ 100,640 per month during months 19 to 24.

Pursuant to the AQMS Lease Agreement, LINICO also has the right to purchase the Battery Recycling Facility for (i) $ 14,250,000 , if the purchase is made on or prior to October 1, 2022, or (ii) $ 15,250,000 , if the purchase is made after October 1, 2022 (“Purchase Option”).

LINICO paid the initial $ 1,250,000 nonrefundable deposit under the AQMS Lease Agreement that was due on or before October 15, 2021, which is included in deposits on the consolidated balance sheets as of December 31, 2021.

The payment will be applied to the purchase price if the Purchase Option is exercised.

The AQMS Lease Agreement also grants the Company the right to consummate the Purchase Option if LINICO and the Landlord agree that LINICO will not exercise the Purchase Option.

We assumed we will exercise the option to purchase the Battery Recycling Facility on or before October 1, 2022.

We recognized the AQMS lease as a new finance lease as part of the asset acquisition of LINICO with an assumed lease term of ten months , total payments of $ 13,693,600 payable through the purchase option date of October 1, 2022, discounted at the Company's incremental borrowing rate of 6 % and an estimated useful life of 30 years for the right-of-use asset.

The value of the right-of-use asset and lease liability upon acquisition, including the pro rata allocation of excess value from the asset acquisition was $ 15,033,000 .

We acquired the lease on December 30, 2021 and no interest expense or amortization of the right-of-use asset was recorded during the year ended December 31, 2021.

We used judgment in estimating the expected timing of exercise of the purchase option, the purchase option price and the discount rate applied in calculating the right-of-use asset and lease liability.

Timing of exercise of the option and the related exercise price may differ from our estimates.

We recognized a lease intangible asset as part of the LINICO asset acquisition in the amount of $ 3,622,488 (see Note 2, Acquisitions and Investments ), representing the value of the purchase option at the date of acquisition.

Operating Lease

The Company has an operating lease, as lessee, with Sutro as lessor, for a property located adjacent to the Gold Hill Hotel, which is primarily used as a room rental.

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For the years ended December 31, 2021 and 2020, the fixed operating lease expense was $ 10,099 and $ 10,099 , respectively with a remaining term of 6.8 years.

The Company has the following lease balances recorded on the consolidated balance sheets:

Lease Assets and Liabilities Classification December 31, 2020 December 31, 2019

Operating lease right-of-use asset Other assets $ 51,294 $ 45,485

Operating lease liability - current Accrued expenses and other liabilities 3,650 9,000

Operating lease liability - long-term Other liabilities 49,791 36,668

Total operating lease liabilities $ 53,441 $ 45,668

Maturities of lease liabilities by fiscal year for the Company's operating lease are as follows:

Maturities of lease liabilities by fiscal year for the Company's operating lease is as follows:

Thereafter 31,500

Total operating lease payments 81,250

Total lease payments 71,900

Imputed interest at 11 %

Present value of lease liabilities $ 49,791

Maturities of lease payments by fiscal year for the Company's operating leases on our land and buildings leased to others are as follows:

Maturities of lease liabilities for the Company's finance lease are $ 13,693,600 , all payable in 2022, with imputed interest of $ 650,101 .

Operating Lease Income

Revenues from operating leases on our land and building leased to others totaled $ 228,123 and $ 201,700 for the years ended December 31, 2021 and 2020, respectively.

Maturities of lease payments for operating leases to others are as follows:

2021 $ 180,025

Thereafter 384,000

Total Minimum Lease Income $ 849,075

The Daney Ranch lease expires August 31, 2023 and provides the lessee an option to purchase the property for $ 2.7 million.

All lease payments received from the lessee and credits for drilling services performed by the lessee during the lease term will reduce the purchase price.

The Gold Hill Hotel lease expired March 31, 2020 and was extended on a month-to month-basis in April 2020.

The land lease expired July 31, 2020 and was extended on a month-to-month basis in August 2020.

All other leases are either on a month-to-month basis or will be month-to-month in 2021, with no extension options.

Long-Term Debt

Long-term debt at December 31, 2020 and 2019 consisted of the following:

Senior Secured Debenture (GF Comstock 2) - 11 % interest, paid in 2020

NOTE 11 DEBT OBLIGATIONS

Debt at December 31, 2021 and 2020 consisted of the following:

12/31/21 12/31/20

GHF Secured Promissory Note – 6 % interest, due December 15, 2024

$ 5,000,000 $ —

Georges Trust Unsecured Promissory Notes - 12 % interest, due September 2021

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Note Payable (Caterpillar Financial Services) - 5.7 % interest.

404,373 645,891

Total debt 5,000,000 3,683,748

long-term debt discounts and deferred issuance costs ( 126,043 ) ( 163,094 )

Total debt, net of discounts and deferred issuance costs 3,557,705 5,412,074

current portion of long-term debt ( 3,557,705 ) ( 328,068 )

Long-term debt, net of discounts and deferred issuance costs $ — $ 5,084,006

Debt Obligations

debt discounts and issuance costs ( 513,744 ) ( 126,043 )

Total debt, net of discounts 4,486,256 3,557,705

current maturities — ( 3,557,705 )

Long-term debt, net of discounts and issuance costs $ 4,486,256 $ —

Concorde Trust, Bean Trust, Georges Trust, GHF, Inc.

Jolcover Unsecured Promissory Notes

We entered into a long-term promissory note ("GHF 2021 Note") with GHF, Inc.

on December 15, 2021, with a principal amount of $ 5,000,000 , of which $ 4,550,000 was funded and $ 450,000 was an original issue discount ("OID").

The full principal is due on December 15, 2024.

Interest is payable monthly at a rate of 6 % annually.

Prepayment is allowed in full or in part at any time without premium or penalty.

The loan is secured by all non-mining related assets of the Company, Silver Springs land and water rights, and the Daney Ranch, excluding the Lucerne and Dayton properties.

The Company is required to prepay the promissory note with any net cash proceeds received in the sale of any collateral.

If the promissory note has not been paid in full on or prior to December 15, 2022, the Company will issue warrants to GHF allowing them to purchase 1,000,000 shares of the Company’s common stock, half of which are exercisable at a price per share of 150 % of the 20 -day volume weighted average closing price (“VWAP”) of the Company’s common stock on its primary trading market for the 20 consecutive trading days preceding December 15, 2021, and the remainder at a price per share of 135 % of the 20 -day VWAP as determined on December 15, 2022.

At December 31, 2021, the warrants were valued at $ 70,879 .

We recognized interest expense of $ 19,720 during the year ended December 31, 2021 in connection with the GHF 2021 Note.

On August 6, 2020, the Company entered into three unsecured promissory notes (together with the additional promissory notes with the Concorde Trust and GHF Inc.

described below, the "Promissory Notes") in order to refinance existing indebtedness on more favorable terms.

The Promissory Notes, with the Concorde Trust, Bean Trust, and Mr.

Jolcover (a former employee of the Company), had an original aggregate principal amount of $ 4,475,000 , were issued at an original issue discount ("OID") of $ 225,000 , bear interest at a rate of 12 % per annum payable monthly, and mature on September 20, 2021.

described below, the "Promissory Notes") with an original aggregate principal amount of $ 4,475,000 , an original issue discount ("OID") of $ 225,000 , and an interest rate of 12 % per annum payable monthly, and a maturity date of September 20, 2021.

On October 1, 2020, the Company revised and divided the Concorde Trust promissory note of $ 3.68 million into two separate Promissory Notes totaling the same amount, that is, a new promissory note to Georges Trust for $ 3.04 million and a revised promissory note to Concorde Trust for $ 0.64 million, representing entities under common control with one another but not with the Company.

On October 1, 2020, the Company paid the former employee's promissory note in full, with a principal payment of $ 150,000 plus OID of $ 1,216 .

As of December 31, 2020, the former employee had no outstanding Promissory Notes, and had received $ 2,876 in payments of interest and $ 151,216 in payments of principal during the year ended December 31, 2020.

This note was paid in full during 2021.

On October 1, 2020, the Company paid the Scott H.

Jolcover promissory notes in full, with a principal payment of $ 150,000 plus OID of $ 1,216 .

At December 31, 2020, the former employee had no outstanding Promissory Notes, and had received $ 2,876 in payments of interest and $ 151,216 in payments of principal during the year ended December 31, 2020.

On October 5, 2020, the Company paid $ 1.7 million in principal for the Georges, Concorde, and Bean Promissory Notes, plus earned OID of $ 15,143 .

On October 9, 2020, the Company paid an additional $ 0.5 million in principal for the remaining Promissory Notes, plus earned OID of $ 4,716 .

These early payments reduced the principal balance on the notes to approximately $ 1.9 million.

On December 4, 2020, the Company entered into two additional Promissory Notes with the Concorde Trust and GHF Inc., which had an original aggregate principal amount of $ 1,309,589 , were issued at an original issue discount of $ 59,589 , bear interest at a rate of 12 % per annum payable monthly, and mature on September 20, 2021.

Interest expense on the Promissory Notes was $ 223,543 for the year ended December 31, 2020, which includes OID amortization of $ 66,868 .

Accrued interest of $ 31,700 was included in accounts payable on the consolidated balance sheets as of December 31, 2020.

The Promissory Notes are unsecured, but contain covenants that prohibit the Company from incurring debt that matures prior to the maturity date of the Promissory Notes or that is senior in right of payment, and require the Company to prepay the Promissory Notes with at least 80 % of the net cash proceeds received by the Company with respect to the sale of the Company's Silver Springs Properties.

The Company is permitted to defer payment for an additional two years of up to 34 % of the original principal balances (or approximately $ 1.9 million) due on the maturity date of the Promissory Notes (i.e., until September 20, 2023), in exchange for two-year warrants to purchase the Company’s common stock based on a 10 % discount to its 20-day volume weighted average price on the original maturity date of the Promissory Notes.

Based on a separate valuation analysis, the Company has concluded that the cash proceeds received approximate the fair value of the Promissory Notes.

In assessing the values of the term extension and contingent warrants derivatives, the valuation model considers the probability of the derivatives being value-accretive and, on an average basis, the related costs exceed the benefits.

As a result, the Company has concluded that the cash proceeds received approximate the fair value of the Promissory Notes.

Accordingly, the value ascribed to the derivatives by the Company is $ 0 on issuance date and at December 31, 2020.

These payments reduced the principal balance on the notes to approximately $ 1.9 million.

This note was paid in full during 2021.

On December 4, 2020, the Company entered into two additional Promissory Notes with the Concorde Trust and GHF Inc., which had an original aggregate principal amount of $ 1,309,589 , were issued at an original issue discount of $ 59,589 , bore interest at a rate of 12 % per annum payable monthly, and mature on September 20, 2021.

This note was paid in full during 2021.

Interest expense on the Promissory Notes was $ 139,213 for the year ended December 31, 2021, including OID amortization of $ 71,289 .

Accrued interest of $ 31,700 was included in accounts payable on the consolidated balance sheets at December 31,

Interest expense on the Promissory Notes was $ 223,543 for the year ended December 31, 2020 including OID amortization of $ 66,868 .

GF Comstock 2 LP

On January 13, 2017, the Company issued the Debenture to GF Comstock 2 LP due January 13, 2021, in an aggregate principal amount of $ 10.7 million.

On January 13, 2017, the Company issued a $ 10.7 million Debenture to GF Comstock 2 LP ("Debenture") due January 13, 2021.

Interest was payable semi-annually.

The Debenture was collateralized by (1) substantially all of the assets of the Company, and (2) a pledge of 100 % of the equity of its subsidiaries.

Hard Rock Nevada Inc., controlled by the former employee, and another related party who is a significant shareholder of the Company, participated in this financing.

In addition, J.

Clark Gillam, a former director of the Company is a manager and member of the general partner of GF Capital 2 LP.

Gillam resigned from the Company's Board of Directors on September 20, 2020.

The Debenture was issued at a discount of approximately $ 0.6 million and with additional issuance costs of approximately $ 0.5 million.

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The discount, issuance costs and make whole obligation were amortized to interest expense during the term of the Debenture.

On August 11, 2020, the Company retired the Debenture by paying the remaining principal balance of approximately $ 4.0 million, plus the remaining make whole obligation of $ 0.2 million.

Upon retirement, all securing collateral was released.

The Company recognized a loss on early retirement of debt of $ 51,000 .

Interest expense on the Debenture was $ 0.4 million and $ 1.3 million for the years ended December 31, 2020 and 2019, respectively.

Tonogold reimbursed $ 0.3 million and $ 0.4 million of the Debenture interest for the years ended December 31, 2020 and 2019, respectively, which was netted against interest expense in the consolidated statements of operations.

On August 11, 2020, the Company retired the Debenture by paying the remaining principal balance of $ 4.0 million, plus the remaining make whole obligation of $ 0.2 million and recognized a loss on early retirement of debt of $ 51,000 .

Interest expense on the Debenture was $ 0.4 million for the year ended December 31, 2020 of which Tonogold reimbursed $ 0.3 million for the year ended December 31, 2020, which was netted against interest expense in the consolidated statements of operations.

Caterpillar Equipment Facility

On June 27, 2016, the Company completed an agreement with Caterpillar Financial Services Corporation ("CAT") relating to certain finance and lease agreements (the “CAT Agreement”).

The Company entered into the CAT Agreement that required the Company to complete the sale of certain financed and leased equipment and modified the payment schedule under the related finance and lease arrangements.

Under the terms of the CAT Agreement, the Company paid down its obligations with the net proceeds from the financed and leased equipment sold during the second and third quarters of 2016, with the remaining balance to be paid off from a monthly payment schedule of primarily $ 29,570 monthly payments until the amounts have been paid in full.

The note bears an interest rate of 5.7 % per annum.

On June 27, 2016, the Company completed an agreement with Caterpillar Financial Services Corporation ("CAT") relating to certain finance and lease agreements for equipment (the “CAT Agreement”).

The Company paid down its obligations with the net proceeds from the financed and leased equipment sold during the second and third quarters of 2016, with the remaining balance to be paid off from a monthly payment schedule of primarily $ 29,570 monthly payments until the amounts have been paid in full.

The note held an interest rate of 5.7 % per annum.

The obligations were recorded at face value on the consolidated balance sheets, which approximated fair value.

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Interest payable for the four deferred payments was added to principal, after which payment amounts were increased to $ 37,817 per month, beginning on September 1, 2020.

Loan Commitment Agreement

In 2017 (and amended in February 2019), the Company entered into a loan commitment agreement with Legend Merchant Group that provides up to $ 10.0 million in borrowing capacity and expires in 2021 with an 11 % interest rate.

Principal amounts borrowed under this agreement are not due until 2021.

No amounts have been borrowed under this agreement and the Company has $ 9.5 million (after consideration of fees due at the time of borrowing) of available borrowing capacity.

There are no maturities due after November 1, 2021.

Long-term Reclamation Liability and Retirement Obligation Asset

The Company is required to mitigate long-term environmental impacts by stabilizing, contouring, re-sloping, and re-vegetating various portions of our sites after mining and mineral processing operations are completed.

These reclamation efforts are conducted in accordance with plans reviewed and approved by appropriate regulatory agencies.

As of December 31, 2020 and 2019, we have accrued a long-term liability of $ 6.1 million, and $ 6.0 million.

On March 4, 2021, we retired the Caterpillar Financial Services loan by paying the remaining principal balance of $ 296,171 .

NOTE 12 LONG-TERM RECLAMATION LIABILITY

We are required to mitigate long-term environmental impacts by stabilizing, contouring, re-sloping, and re-vegetating various portions of our sites after mining and mineral processing operations are completed.

These reclamation actions are conducted in accordance with plans reviewed and approved by appropriate regulatory agencies.

At December 31, 2021 and 2020, we accrued an asset retirement obligation of $ 5,445,672 , and $ 6,054,919 .

respectively, for our obligation to reclaim our mine facilities based on our most recent reclamation plan, as revised, submitted and approved by the Nevada State Environmental Commission and Division of Environmental Protection.

Our total reclamation liability includes cost estimates for our American Flat processing facility, Dayton project and enhanced reclamation obligations in Storey County.

As of December 31, 2019, $ 1.0 million of the accrued long-term liability associated with the Lucerne mineral property was reclassified to liabilities held for sale.

We do not currently have a schedule for final reclamation of the American Flat processing facility.

Under the Lease Option Agreement with Tonogold, we must preserve the property and equipment in its current state for possible resumption of processing by Tonogold.

Tonogold has not yet announced specific plans or a definitive schedule for future processing.

In conjunction with recording the reclamation liability, we recorded a retirement obligation asset on the consolidated balance sheets that is being amortized over the period of the anticipated land disturbance and operations.

Such costs are based on management’s original estimate of then expected amounts for remediation work, assuming the work is performed in accordance with current laws and regulations.

It is reasonably possible that, due to uncertainties associated with the application of laws and regulations by regulatory authorities and changes in reclamation or remediation technology, the ultimate cost and timing of reclamation and remediation could change in the future.

We periodically review the accrued reclamation liability for information indicating that our assumptions should change.

The accretion of the reclamation liability for the years ended December 31, 2020 and 2019 totaled $ 20,711 and $ 22,840 , respectively, and was a component of environmental and reclamation expenses in the consolidated statements of operations.

The amortization of the retirement obligation asset for the years ended December 31, 2020 and 2019 totaled $ 57,963 and $ 67,758 , respectively, and was a component of environmental and reclamation expenses in the consolidated statements of operations.

On April 30, 2019, the Company was notified by the Nevada Division of Environmental Protection that the Company’s successful reclamation of parts of the Lucerne Mine area had reduced the Lucerne project reclamation cost estimate with an updated reclamation bond requirement of $ 6.8 million, resulting in a $ 0.4 million reduction in the obligation, which was a component of environmental and reclamation expenses in the consolidated statements of operations in 2019.

Following is a reconciliation of the mining retirement liability associated with our reclamation plan for the mining projects for the years ended December 31, 2020, and 2019:

Long-term reclamation liability — beginning of year $ 6,034,208 $ 7,441,091

Reduction of obligation — ( 410,018 )

Amount reclassified to liabilities held for sale — ( 1,019,705 )

Effective January 1, 2021, we updated the expected reclamation commencement date from December 31, 2022 to December 31, 2025.

This resulted in a reduction in the liability of $ 926,434 using a discount rate of 6.02 %.

The adjustment in excess of the net retirement obligation asset of $ 57,963 was $ 868,471 at January 1, 2021 and was recorded in the consolidated statements of operations.

Following is a reconciliation of the mining retirement asset associated with our reclamation plan for the mining projects for the years ended December 31, 2021, and 2020:

12/31/21 12/31/20

Long-term reclamation liability — beginning of period $ 6,054,919 $ 6,034,208

Reduction of obligation due to extension of time ( 926,434 ) —

Accretion of reclamation liability 317,187 20,711

Long-term reclamation liability — end of year $ 6,054,919 $ 6,034,208

Following is a reconciliation of the mining retirement obligation asset for the years ended December 31, 2020 and 2019:

Retirement obligation asset — beginning of year $ 115,926 $ 203,274

Amount reclassified to assets held for sale — ( 19,590 )

Amortization of retirement obligation asset ( 57,963 ) ( 67,758 )

Retirement obligation asset — end of year $ 57,963 $ 115,926

Commitments and Contingencies

The Company leases certain mineral rights and properties under operating leases expiring at various dates through 2040.

Future minimum annual lease payments, including royalty and rental payments, under these existing lease agreements are as follows as of December 31, 2020:

Year Ended December 31, Leases

Long-term reclamation liability — end of period $ 5,445,672 $ 6,054,919

NOTE 13 COMMITMENTS AND CONTINGENCIES

CONTINGENT PAYMENT OBLIGATIONS

FLUX Photon Corporation

The purchase price payable for the FPC Assets is $ 18,000,000 payable in cash to FPC with 20 % of the future monthly consolidated sales, less total variable costs, less operating expenses, maintenance, tax payments, and debt service payments of the Company and its now and hereafter-existing subsidiaries, until the purchase price of $ 18,000,000 has been fully paid.

On December 10, 2021, the Asset Purchase Agreement was amended to provide for the payment by the Company of a $ 350,000 down payment against the purchase price, which reduced the stated purchase price to $ 17,650,000 at December 31, 2021.

MANA Corporation

On July 23, 2021, the Company entered into a Securities Exchange Agreement to purchase 100 % of the issued and outstanding equity of MANA Corporation.

MANA provides industrial hemp origination, toll processing, sales, marketing, commodities, co-products management, and related products and services.

MANA has a contingent payment obligation equal to 20 % of MANA’s future net cash flow deriving from sales of industrial hemp and its derivatives, as defined in the applicable agreement, in an amount up to $ 8,600,000 .

This amount has not been recorded in our consolidated financial statements for the year ended December 31, 2021, as it has been determined to be neither probable nor reasonably estimable.

Comstock Innovations - Pilot Facility

Comstock Innovations, our wholly-owned technology research and development subsidiary, is subject to an asset purchase agreement with American Science and Technology Corporation (“AST”), pursuant to which the Company agreed to purchase substantially all of the real and personal property located at 6445 Packer Drive, Wausau, Wisconsin 54401 (“Pilot Facility”), including pilot scale processing equipment used in connection with some of our cellulosic fuels and electrification metals extraction and refining processes.

The purchase agreement calls for a purchase price of $ 3,920,000 in installments of $ 35,000 per month from May 1, 2022 to April 30, 2023, $ 1,750,000 on April 30, 2023, and $ 1,750,000 on April 30, 2024.

The costs associated with the Pilot Facility’s research and development support operations are allocated (on a time and materials basis at cost) to our cellulosic fuels, electrification metals, cleantech engineering, technology licensing, and strategic and other investments segments, as applicable.

LINICO Corporation

At December 31, 2021, LINICO had $ 3,219,607 in deposits with various vendors for the plant and equipment.

COMSTOCK MINERAL ESTATE LEASE PAYMENTS

We lease certain mineral rights and properties under leases expiring at various dates through 2040.

Future minimum annual lease payments, including royalty and rental payments, under these existing lease agreements are as follows at December 31, 2021:

2022 $ 114,000

Thereafter 1,536,250

Expense under leases for each of the years ended December 31, 2020 and 2019 was $ 0.1 million.

Royalty Agreements

The Company has minimum royalty obligations with certain of its mineral properties and leases.

Minimum royalty payments were $ 66,400 for the year ended December 31, 2020.

For most of the mineral properties and leases, the Company is subject to a range of royalty obligations once production commences.

These royalties range from 0.5 % to 5 % of NSR from minerals produced on the properties with the majority being under 3 %.

Some of the factors that will influence the amount of the royalties include ounces extracted and prices of gold.

Royalty expense, including both NSR and minimum royalty obligations, was $ 0.1 million for each of the years ended 2020 and 2019.

The Company’s mining and exploration activities are subject to various laws and regulations governing the protection of the environment.

These laws and regulations are continually changing and are generally becoming more restrictive.

Total minimum annual lease payments $ 2,132,250

We have minimum royalty obligations with certain of its mineral properties and leases.

For most of the mineral properties and leases, we are subject to a range of royalty obligations to the extent that production commences.

These royalties range from 0.5 % to 5 % of Net Smelter Returns ("NSR") from minerals produced on the properties, with the majority being under 3 %.

Some of the factors that will influence the amount of the royalties include ounces extracted and the price of extracted metals.

Our mining and exploration activities are subject to various laws and regulations governing the protection of the environment.

These laws and regulations are continually changing and generally become more restrictive.

The Company believes its operations are in compliance with applicable laws and regulations in all material respects.

The Company has made, and expects to make in the future, expenditures to comply with such laws and regulations, but cannot predict the full amount of such future expenditures.

Comstock Residents Association

Mineral and Mining Leases

The Company is party to lease agreements with Tonogold.

Tonogold pays to the Company a quarterly lease fee of $ 10,000 .

The lease fee will escalate 10 % each year on the anniversary date of the Exploration Lease.

Tonogold also reimburses the Company for all costs associated with owning the properties, including, but not limited to, lease payments for underlying, third-party leases.

The Exploration Lease also provides for royalty payments when mining operations commence.

On November 18, 2019, the Company, entered into an agreement to lease its permitted American Flat property, plant and equipment to Tonogold for crushing, leaching and processing material from the Lucerne Mine (the "Lease Option Agreement").

Under the Lease Option Agreement, Tonogold is required to reimburse the Company approximately $ 1,100,000 in expenses per year to maintain the option.

The Lease Option Agreement remains in effect, but has not yet been exercised.

The Lease Option Agreement expires in November 2025.

Total reimbursements under the Tonogold agreements for the years ended December 31, 2021 and 2020 were approximately $ 2,800,000 and $ 2,600,000 , respectively.

Total reimbursements receivable under the Tonogold agreements for the years ended December 31, 2021 and 2020 were approximately $ 800,000 and $ 0 .

On September 1, 2020, the Company entered into a new mineral exploration and mining lease with Sutro.

The lease covers patented mining claims, exploration rights, and access over and through town lots in Gold Hill and Virginia City, Nevada.

The lease also provides the right to explore the Sutro Tunnel.

On January 31, 2014, the Comstock Residents Association (the “CRA”) and two of its members filed a civil action in the Third Judicial District Court in Lyon County, Nevada (the “District Court”) against the Lyon County Board of Commissioners (the “Commissioners”) and the Company, asking the District Court to reverse the Commissioners’ decision to grant an application for master plan amendment and zone change submitted and approved by the Commissioners in 2014 (the “Application”).

Prior to approval of the Application, the master plan designation and zoning precluded mining on certain property of the Company in the area of Silver City, Nevada.

In April 2015, the District Court ruled in favor of the Company and the Commissioners.

The written Order Denying Petition for Judicial Review was filed and mailed to all parties on June 15, 2015.

On July 14, 2015, the CRA and one individual (together “Appellants”) filed a Notice of Appeal of the Court Order, appealing the decision to the Nevada Supreme Court.

On December 9, 2015, Appellants filed their Opening Brief in the Nevada Supreme Court, generally repeating the arguments that were made at the District Court.

On January 15, 2016, the Company and the Commissioners jointly filed an Answering Brief.

Briefing in the Nevada Supreme Court was completed with the Appellants’ filing of a Reply Brief on March 3, 2016.

Oral arguments before a three-judge panel took place on September 14, 2016.

On December 2, 2016, the Nevada Supreme Court entered an order affirming all three of the District Court’s decisions associated with 1) the Commissioners’ discretion and authority for changing master plans and zoning, 2) their compliance with Nevada’s Open Meeting Law and 3) their compliance with Nevada statutory provisions.

Specifically, the Supreme Court affirmed the District Court’s conclusions that Lyon County did not abuse its discretion and that it acted with substantial evidence in support of its decision that the County did not violate Nevada’s Open Meeting Law or any other statutes.

The Supreme Court reversed the District Court’s dismissal of CRA’s claim of a due process violation, concluding that this claim should not have been dismissed and that further proceedings are necessary in the District Court on this single claim.

District Court concluded that the Supreme Court's reversal of CRA's due process claim required that CRA be afforded the opportunity to conduct discovery and allowed CRA the time to conduct discovery on its due process claim.

The Company responded to the CRA discovery request on February 20, 2018, and the District Court held a hearing on April 23, 2018.

Additional discovery was also allowed by the District Court.

On May 14, 2019, the Court held a hearing on CRA’s due process claim and issued its ruling from the bench.

The Court concluded that CRA, having been afforded the opportunity to conduct discovery, was unable to meet its burden to establish by a preponderance of the evidence that Lyon County had denied CRA of its due process rights.

The Court, therefore, denied CRA's due process claim.

On July 11, 2019, the Court issued and filed a formal judgment in favor of Lyon County and Comstock.

The Company and Lyon County have filed a motion to recover attorney's fees and costs from the CRA.

On August 14, 2019, the CRA filed a Notice of Appeal, appealing the judgment to the Nevada Supreme Court.

CRA filed their Opening Brief on January 24, 2020.

The Company’s Answering Brief was filed on March 25, 2020.

The appellate briefing was completed with the filing of CRA’s Reply Brief on May 8, 2020.

On January 11, 2021, the Nevada Supreme Court issued a final order affirming the District Court's judgment in favor of Lyon County and Comstock.

On January 11, 2021, the Nevada Supreme Court issued a final order affirming the District Court's judgment in favor of Lyon County and Comstock Mining.

On January 29, 2021, the CRA filed a Petition for Rehearing to the Nevada Supreme Court.

On February 25, 2021, the Nevada Supreme Court issued an order denying a rehearing.

As such, no amounts have been accrued as it relates to this complaint.

Precious Royalties LLC

On July 12, 2018, Precious Royalties LLC (“Precious”) filed a complaint against the Company in the First Judicial District Court of the State of Nevada, in Storey County, alleging that the Company failed to properly pay Precious a NSR royalty in accordance with a settlement agreement dated September 24, 2012, and seeking $ 510,000 in damages, plus interest at 18 % per annum.

On November 16, 2018, the Company filed a Motion for a More Definite Statement on the basis that the complaint is too vague to allow a responsive pleading.

On May 16, 2019, the Court granted the Company’s Motion, which required Precious to revise and re-file its complaint in order to proceed with the action.

Precious re-filed the complaint on June 5, 2019.

On July 3, 2019, the Company answered the amended claim by Precious and filed a counterclaim that, among other things, requests reimbursement of legal fees and related interest.

On July 26, 2019, Precious filed an answer to the counterclaim and a four-day trial was set for July 20, 2020.

On January 13, 2020, the Company and Precious negotiated a definitive and final settlement of all claims and counterclaims between the parties, and made a one-time payment to Precious of $ 60,000 .

OSHA Complaint

On or about February 27, 2020, the Company received notice that three former employees had filed a complaint with OSHA regarding alleged wrongful termination of employment in 2019, seeking backpay, frontpay and other compensatory damages (for mental anguish and reputational harm) as well as interest and legal fees and costs.

We believe that those terminations were lawful and intend to vigorously defend the complaint.

As of December 31, 2020, the Company has accrued severance of $ 84,166 in connection with this complaint, which is recorded in accrued expenses and other liabilities on the consolidated balance sheets.

From time to time, we are involved in claims, investigations and proceedings that arise in the ordinary course of business.

On March 8, 2021, the CRA filed a Petition for En Banc Reconsideration to the Nevada Supreme Court.

On April 9, 2021, the Nevada Supreme Court responded to the petition by issuing an order denying en banc reconsideration, once again, in favor of Lyon County and Comstock Mining.

On July 30, 2021 Judge Estes of the Third Judicial District Court in Lyon County, Nevada ruled in favor of Lyon County and the Company and awarded attorney fees and costs to be paid by the plaintiffs in the sum of $ 50,000 to Lyon County and $ 203,151 to the Company.

On August 27, 2021 the CRA filed a notice of appeal to the Nevada Supreme Court.

On or about February 27, 2020, we received notice that three former employees had filed a complaint with OSHA regarding alleged wrongful termination of employment in 2019, seeking backpay, front pay and other compensatory damages as well as interest and legal fees and costs.

On September 8, 2021, OSHA notified the three former employees that it was dismissing their complaint after OSHA was informed that the former employees were instead planning to file a complaint in federal court.

On August 20, 2021, the former employees filed a lawsuit against the Company, its Board of Directors, its Audit and Finance Committee, its Chief Executive Officer and certain of its managers for the wrongful termination of their employment.

We believe those terminations were lawful and we are vigorously defending the complaint.

At December 31, 2021, the Company has accrued severance and related costs for this complaint in accrued expenses and other liabilities on the consolidated balance sheets (see Note 22, Subsequent Events ).

From time to time, we are involved in claims and proceedings that arise in the ordinary course of business.

There are no matters pending that we expect to have a material adverse impact on our business, results of operations, financial condition or cash flows.

Equity Issuance Agreements

In July 2020, the Company entered into an equity purchase agreement (the "2020 Triton Equity Agreement") with Triton Funds L.P.

("Triton") to offer and sell registered shares of common stock at an aggregate offering price of up to $ 1.25 million, from time to time, at the Company's option.

In July 2020, the Company issued to Triton 2,040,483 common shares with an aggregate sales price of $ 1.25 million, at an average price per share of $ 0.61 , and paid related cash fees of $ 15,000 .

As of December 31, 2020, the 2020 Triton Equity Agreement has no remaining capacity

Also in July 2020, the Company entered into an equity purchase agreement (the "2020 Leviston Sales Agreement") with Leviston Resources LLC ("Leviston") to offer and sell registered shares of common stock at an aggregate offering price of up to

NOTE 14 EQUITY

ISSUANCE OF REGISTERED SHARES OF COMMON STOCK

On February 8, 2021, we entered into an equity purchase agreement (“2021 Leviston Sales Agreement”) with Leviston to offer and sell registered shares of common stock at an aggregate offering price of up to $ 5.0 million from time to time, at our option, on terms we deem favorable.

The term of the agreement was 24 months.

We agreed to deliver to Leviston additional shares of common stock in payment of due diligence and commitment fees with a fair value of $ 250,003 , for no additional consideration, on the first settlement date with respect to a put notice delivered by us.

For the year ended December 31, 2021, we issued to Leviston 1,551,760 common shares under this agreement with an aggregate sales price of $ 5.0 million, at an average price per share of $ 3.22 , and an additional 50,907 common shares in commitment and due diligence fees.

At December 31, 2021, the 2021 Leviston Sales Agreement has no capacity.

On March 2, 2021, we entered into equity purchase agreements (“Equity Purchase Agreements”) with certain investors to issue and sell in a registered direct offering (“Offering”) 4.0 million shares of common stock at a price of $ 4.00 per share.

The Equity Purchase Agreements contain customary representations, warranties and agreements of the Company, and customary conditions to closing, indemnification rights and obligations of the parties.

The Offering of the shares closed on March 4, 2021.

We paid Noble Capital Markets, Inc., the placement agent for the Offering, an aggregate cash fee of $ 960,000 (equal to 6 % of the aggregate gross proceeds raised in the Offering), and $ 30,000 for other expenses, resulting in net proceeds of $ 15,010,000 .

On September 28, 2021, we entered into an equity purchase agreement (“2021 Leviston Equity Agreement”) with Leviston Resources LLC (“Leviston”) to offer and sell registered shares of common stock at an aggregate offering price of up to $ 5.0 million from time to time, at our option, on terms we deem favorable.

The term of the agreement is 24 months.

We agreed to deliver to Leviston additional shares of common stock, for no additional consideration, with a fair value of $ 100,000 in due diligence fees, on the first settlement date with respect to a put notice delivered by us, and $ 150,000 in commitment fees upon the written request of Leviston.

For the year ended December 31, 2021, we issued to Leviston 2,668,363 common shares under this agreement with an aggregate sales price of $ 5.0 million, at an average price per share of $ 1.87 , and an additional 92,880 common shares in due diligence fees.

At December 31, 2021, the 2021 Leviston Equity Agreement has no capacity.

On December 3, 2021, the Company sold 1,000,000 shares of unregistered securities at a price of $ 1.40 per common shares, for net proceeds of $ 1.4 million for the year ended December 31, 2021.

In July 2020, the Company entered into an equity purchase agreement (the "2020 Leviston Sales Agreement") with Leviston Resources LLC ("Leviston") to offer and sell registered shares of common stock at an aggregate offering price of up to

$ 2.5 million, from time to time, at the Company's option, and paid a commitment fee of $ 125,000 in shares of common stock and $ 52,500 of cash fees.

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As of December 31, 2020, the 2020 Leviston Sales Agreement has no remaining capacity.

In October 2019, the Company entered into an equity purchase agreement (the "2019 Leviston Sales Agreement") with Leviston up to offer and sell registered shares of common stock at an aggregate offering price of up to $ 1.25 million, from time to time, at the Company’s option, subject to certain restrictions and a $ 125,000 fee payable to Leviston in shares of common stock.

In October 2019, the Company issued to Leviston 1,863,150 common shares with an aggregate sales price of $ 0.8 million, at an average price per share of $ 0.43 , and an additional 284,852 common shares in commitment fees.

From March through July 2020, the Company issued to Leviston an additional 913,539 common shares with an aggregate sales price of $ 0.4 million, at an average price per share of $ 0.49 .

As of December 31, 2020, the 2019 Leviston Sales Agreement has no remaining capacity.

In February 2019, the Company entered into an equity purchase agreement (the “2019 Murray Equity Agreement”) with the Murray Family Office (“Murray”) to offer and sell shares of common stock at an aggregate offering price of up to $ 5.0 million, from time to time, at the Company’s option, subject to certain restrictions, at a 10 % discount to a volume weighted average sales price per common share, and paid a fee of $ 250,000 in shares of common stock and cash fees of $ 50,715 .

From May through September 2019, the Company issued to Murray 2,988,120 common shares with an aggregate sales price of $ 1.9 million, at an average price per share of $ 0.65 , and an additional 131,556 common shares in fees.

As of December 31, 2020, the 2019 Murray Equity Agreement has no remaining capacity.

In August 2018, the Company entered into an equity purchase agreement (the “2018 Leviston Sales Agreement”) with Leviston to offer and sell registered shares of common stock at an aggregate offering price of up to $ 2.25 million, from time to time, at the Company’s option, subject to certain restrictions.

In January and February 2019, the Company issued to Leviston 1,090,400 common shares for net proceeds of $ 0.8 million, at an average price per share of $ 0.75 .

As of December 31, 2020, the 2018 Leviston Sales Agreement has no remaining capacity.

Convertible Preferred Stock

In June 2019, the Company entered into the securities purchase agreement with Temple Tower Group LLC ("Temple") providing for the issuance and sale to Temple of 1,274 shares of convertible preferred stock with a stated value of $ 1,000 per share, for net proceeds to the Company of $ 1.1 million with 191 of the Preferred Shares representing due diligence fees.

The total of 1,274 preferred shares had a stated value of $ 1.3 million and a fair value of $ 1.5 million based on a third-party valuation study.

The Company recorded the difference between the net proceeds of $ 1.1 million and the fair value of $ 1.5 million as a cost of issuing the preferred shares.

The preferred shares were convertible into shares of the Company’s common stock.

The number of common shares issuable upon conversion was determined by dividing the stated value of the Preferred Shares by the conversion price.

The conversion price was calculated as 90 % of the lowest reported volume-weighted average price per share of for the Company’s common stock as reported at the close of trading on the NYSE American stock exchange during the seven trading days ending on, and including, the date of the notice of conversion.

From July through September 2019, Temple converted all of the preferred shares for 2,240,441 common shares at an average conversion price per share of $ 0.57 .

Reverse Stock Split

In November 2019, the Board of Directors of the Company approved a one-for-five (1:5) reverse stock split (the “Reverse Split”) for all issued and outstanding shares of the Company’s common stock, par value $ 0.000666 , and a contemporaneous one-for-five (1:5) reduction in the number of shares of the Company’s authorized common stock from 790,000,000 to 158,000,000 shares.

The Reverse Split resulted in each outstanding five pre-split shares of common stock automatically combining into one new share of common stock without any action on the part of the stockholders.

No fractional shares were issued as a result of the Reverse Split.

Fractional shares were rounded up to the nearest whole share requiring the issuance of 9,114 additional shares of common stock, included in issuance of common stock in the consolidated statements of changes in equity.

The Reverse Split was effective for trading purposes on November 29, 2019.

The total number of outstanding common shares was reduced from 126,970,215 to 25,394,043 on the effective date.

All common shares and per share amounts set forth herein give effect to this Reverse Split.

The Reverse Split also applies to awards available for issuance under the 2011 Equity Incentive Plan.

Gross proceeds from and cash fees related to the issuance of shares of the Company's common stock pursuant to registered equity issuance and exempt private placement agreements, and conversion of preferred shares are presented below for the years ended December 31, 2020 and 2019:

Gross proceeds from and cash fees related to the issuance of shares of the Company's common stock pursuant to registered equity issuance and exempt private placement agreements, are presented below for the years ended December 31, 2021 and 2020:

12/31/21 12/31/20

Number of shares sold 9,220,123 5,747,608

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Average gross proceeds per share $ 2.97 $ 0.73

Stock-based Transactions

Following is a reconciliation of stock-based transactions for the years ended December 31, 2020 and 2019:

Shares outstanding as of beginning of year 27,236,489 15,067,655

Shares issued for:

Equity issuance agreements 5,747,608 5,941,670

Issuance of common stock for convertible preferred — 2,240,441

Private placement agreements — 1,833,332

Reverse split fractional shares — 9,114

Common stock issuance costs 173,611 498,008

Share contributions for mineral rights 343,058 746,269

Investment in Mercury Clean Up, LLC 625,000 900,000

Director compensation 315,000 —

Director restricted stock grants 540,000 —

Total shares issued 7,744,277 12,168,834

Shares outstanding as of end of year 34,980,766 27,236,489

The table above includes:

During 2020 and 2019, the Company issued 343,058 and 746,269 common shares, respectively, valued at $ 0.5 million each in satisfaction of annual payments pursuant to the Northern Comstock LLC operating agreement, a related party.

During 2020 and 2019, the Company issued 625,000 and 900,000 common shares, valued at $ 0.4 million and $ 0.8 million, respectively, in connection with the purchase of membership interests in MCU.

In May 2020, the Company issued 315,000 common shares, valued at $ 0.2 million, to its non-executive directors in compensation for services rendered and, in December 2020, granted 540,000 restricted common shares to its non-executive directors that will vest evenly on January 1, 2022, 2023 and 2024.

ISSUANCE OF UNREGISTERED SHARES OF COMMON STOCK

Issuance of restricted shares of our common stock in connection with acquisitions, investments and other endeavors for the year ended December 31, 2021 are as follows:

Issuance Date

Acquisition/Investment

Common Shares Issued

Restriction Period

February 16, 2021

LINICO Corporation

June 18, 2021

Renewable Process Solutions, Inc.

June 24, 2021

Quantum Generative Materials LLC

July 23, 2021

MANA Corporation

July 23, 2021

LP Biosciences LLC

August 27, 2021

Northern Comstock LLC

September 7, 2021

Plain Sight Innovations Corporation

December 30, 2021

LINICO Corporation

Total common shares issued

28 % six months from issuance date;

additional 8 % becomes unrestricted semi-annually through 5 years from issuance date.

Six months from issuance date.

On December 31, 2021, we filed a prospectus on Form S-3 with the Securities and Exchange Commission to register the 3,500,000 shares of common stock issued to LPB for resale at a proposed maximum offering price per unit of $ 2.71 .

Effective February 28, 2022, these shares were transferred back to the Company for cancellation upon receipt (See Note 22, Subsequent Events).

Nine months from issuance date.

Shares must be sold during the six -month period commencing nine months from the issuance date and ending 15 months from the issuance date pursuant to a Rule 10b5-1 plan.

Noncontrolling Interest

On January 24, 2019, the Company entered into an agreement, as amended on April 30, 2019, May 22, 2019, June 21, 2019, August 15, 2019, September 20, 2019, October 14, 2019, and November 17, 2019, to sell to Tonogold its interests in Comstock LLC, a wholly-owned subsidiary of the Company, with sole assets of the Lucerne properties and related permits.

At the initial closing on November 18, 2019, a 50 % membership interest in Comstock LLC was delivered to Tonogold with the Company retaining all management control and authority over Comstock LLC until 100% of consideration for all Comstock LLC

membership interests was delivered.

Accordingly, Tonogold’s membership interest in Comstock LLC was accounted for as a noncontrolling interest shown in the consolidated financial statements of the Company.

On September 8, 2020, 100% of the membership interests of Comstock LLC were acquired by Tonogold and the noncontrolling interest was eliminated as part of the purchase (Note 2).

Fair Value Measurements

On December 30, 2021, we entered into an agreement with LINICO to purchase additional shares resulting in a 90 % controlling interest (see Note 2, Acquisitions and Investments ).

The remaining 10 % ownership is held by AQMS (see Note 21, Related Party ) and is accounted for as a noncontrolling interest in our consolidated financial statements.

On January 24, 2019, we entered into an agreement, as amended on April 30, 2019, May 22, 2019, June 21, 2019, August 15, 2019, September 20, 2019, October 14, 2019, and November 17, 2019, to sell to Tonogold its interests in Comstock Mining LLC, a wholly-owned subsidiary of the Company, with sole assets of the Lucerne properties and related permits.

At the initial closing on November 18, 2019, a 50 % membership interest in Comstock Mining LLC was delivered to Tonogold with the Company retaining all management control and authority over Comstock Mining LLC until 100 % of consideration for all membership interests was delivered.

Accordingly, Tonogold’s membership interest in Comstock Mining LLC was accounted for as a noncontrolling interest shown in the consolidated financial statements of the Company.

On September 8, 2020, 100 % of the membership interests of Comstock Mining LLC were acquired by Tonogold and the noncontrolling interest was eliminated as part of the purchase (see Note 2, Acquisitions and Investments ).

Treasury Stock

Our treasury stock consists of 3,000,000 shares held by our 90 % owned subsidiary LINICO.

We expect LINICO will sell the shares and we have presented the cost of the acquired stock as a deduction from equity.

The fair value on the date of acquisition is $ 3,870,000 (See Note 2, Acquisitions and Investments).

There were no gains on sales during the year ended December 31, 2021.

NOTE 15 FAIR VALUE MEASUREMENTS

ASSETS AND LIABILITIES MEASURED AT FAIR VALUE ON A RECURRING BASIS

The following table presents our assets and liabilities at December 31, 2020, which were measured at fair value on a recurring basis:

The following table presents our assets and liabilities measured at fair value on a recurring basis at December 31, 2021:

Fair Value Measurements at

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(Level 2) Significant

Common shares of Tonogold (Note 2) $ 3,939,558 $ 3,939,558 $ — $ —

Tonogold note receivable (Note 3) 5,498,500 — — 5,498,500

MCU derivative asset (Note 2) 265,127 — 265,127 —

Commons shares of Eclipse (Note 2) 40,165 — 40,165 —

Total Assets $ 9,743,350 $ 3,939,558 $ 305,292 $ 5,498,500

Tonogold common shares $ 910,558 $ 910,558 $ — $ —

Tonogold note receivable 7,255,000 — — 7,255,000

LPB derivative asset 342,000 — 342,000 —

Other equity securities 15,260 15,260 — —

Total assets measured at fair value $ 8,522,818 $ 925,818 $ 342,000 $ 7,255,000

LINICO acquisition derivative liability $ ( 2,743,162 ) $ ( 2,743,162 ) $ — $ —

GenMat derivative $ ( 6,130,000 ) $ — $ ( 6,130,000 ) $ —

Total liabilities measured at fair value $ ( 8,873,162 ) $ ( 2,743,162 ) $ ( 6,130,000 ) $ —

The following table presents our assets and liabilities at December 31, 2020, which are measured at fair value on a recurring basis:

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(Level 2) Significant

Tonogold convertible preferred shares $ 9,080,000 $ — $ — $ 9,080,000

Total Assets $ 9,080,000 $ — $ — $ 9,080,000

Accrued make whole for Pelen LLC (Note 2) $ 222,602 $ — $ 222,602 $ —

Accrued make whole for MCU (Note 2) 452,740 — 452,740 —

Total Liabilities $ 675,342 $ — $ 675,342 $ —

Tonogold common shares $ 3,939,558 $ 3,939,558 $ — $ —

Tonogold note receivable 5,498,500 — — 5,498,500

MCU derivative asset 265,127 — 265,127 —

Other equity securities 40,165 — 40,165 —

Total assets measured at fair value $ 9,743,350 $ 3,939,558 $ 305,292 $ 5,498,500

During the year ended December 31, 2021, the common shares of Elevation Gold Mining Corporation, previously Northern Vertex ("Elevation") were transferred from Level 2 to Level 1 as a result of the restriction period expiring on March 1, 2021.

During the year ended December 31, 2020, we converted Tonogold CPS to common shares, resulting in a transfer from Level 3 to Level 1.

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The following table provides reconciliation between the beginning and ending balance of investments measured at fair value on a recurring basis using significant unobservable inputs (Level 3).

12/31/21 12/31/20

Beginning Balance $ 5,498,500 $ 9,080,000

Total income (losses) recognized in earnings

Total change in fair value recognized in earnings

Tonogold convertible preferred shares — ( 2,544,000 )

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( 418,500 ) ( 2,421,117 )

Tonogold convertible preferred shares — 7,607,263

Tonogold contingent forward asset — 1,232,952

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Ending balance $ 7,255,000 $ 5,498,500

VALUATION METHODOLOGIES

Following is a description of the valuation methodologies used for the Company's financial instruments measured at fair value on a recurring basis as well as the general classification of such instruments pursuant to the valuation hierarchy.

Tonogold Convertible Preferred Shares

The consideration received for Tonogold's acquisition of Comstock LLC included shares of the Tonogold CPS (Note 2).

Since the CPS shares are not listed securities, and have no readily available market, the Company elected the fair value option for this financial instrument.

CPS was recorded on the consolidated balance sheets at fair value when received and adjusted to fair value at the end of each reporting period, with changes in fair value reported in net earnings.

The Company recorded the receipt of the CPS on the consolidated balance sheets at a fair value of $ 7.6 million when received at various dates in 2019.

The Company recognized changes in fair value of the CPS of $ 2.5 million in other expense and $ 1.5 million in other income in the consolidated statements of operations for the years ended December 31, 2020 and 2019, respectively.

At issuance, the fair value of the Tonogold CPS was based on a Monte Carlo model with various inputs including the Tonogold common share price of $ 0.40 , volatility of 82 %, risk-free rate of 1.58 %, cost of debt of 11.81 %, private placement conversion price ceiling of $ 0.18 , redemption probability of 50 %, and illiquidity discount of 10 % - 15 %.

On October 2, 2020, Tonogold issued a redemption notice for the remaining $ 2.2 million (face value) of CPS held by the Company.

The redemption price of $ 2.6 million in cash, representing 120 % of face value, was received October 2, 2020.

The CPS were classified within Level 3 of the valuation hierarchy.

Tonogold Common Shares

On May 22, 2020, the Company converted $ 1.1 million face value of CPS ( 1,100 Tonogold preferred shares) into 6,111,111 Tonogold common shares.

On September 29, 2020, the Company converted $ 2.8 million face value of CPS ( 2,820 Tonogold

preferred shares) into 15,666,667 Tonogold common shares.

During 2020, the Company sold 8,645,918 of these common shares for total proceeds of $ 2.9 million and held 13,131,860 Tonogold common shares with a fair value of $ 3.9 million based on the $ 0.30 closing price per share (OTC:TNGL) on December 31, 2020.

The investment in Tonogold common shares is classified within Level 1 of the valuation hierarchy.

The fair value of our investment in common shares of Tonogold is based on the closing price per share of the stock.

At December 31, 2021 and December 31, 2020, we held 8,671,985 and 13,131,860 Tonogold common shares with fair values of $ 910,558 and $ 3,939,558 , respectively.

The fair values of the common shares are based on the $ 0.11 and $ 0.30 closing share prices (OTC:

TNGL), respectively.

We recorded a loss of $ 2,286,867 and a gain of $ 1,636,468 for the gain (loss) on investments in the consolidated statements of operations for the years ended December 31, 2021 and December 31, 2020.

Tonogold Note Receivable

In connection with Tonogold's acquisition of Comstock LLC (Note 2), on September 8, 2020, the Company recorded the Note due from Tonogold on the consolidated balance sheets, with a principal amount of $ 4,475,000 and a 12 % annual interest rate.

Interest is due and payable monthly with the principal due and payable on September 20, 2021 (the “Maturity Date”).

The Note may be converted into Tonogold common shares, at the sole discretion of the Company, at the Maturity Date, upon an event of default or upon a partial or whole prepayment by Tonogold.

The Maturity Date may be extended at the Company’s option if an event of default has occurred or is expected to occur or a fundamental transaction (as defined in the Note) has been announced but not yet closed.

Because of the embedded features, the Company made the irrevocable election to report the Tonogold Note Receivable on a fair value basis.

The Tonogold Note may be converted into Tonogold common shares, at the sole discretion of the Company, at the Maturity Date, upon an event of default or upon a partial or whole prepayment by Tonogold.

The Maturity Date may be extended at the Company’s option if an event of default has occurred or is expected to occur or a fundamental transaction (as defined by the Note) has been announced but not yet closed.

Because of the embedded features, the Company made the irrevocable election to report the Note on a fair value basis.

The Note principal was originally due and payable on September 20, 2021, and has been extended to March 31, 2022.

The Note was amended on March 31, 2021 and June 1, 2021 to its current principal balance of $ 6,650,000 .

The Note includes the following features:

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and 4) an option for the Company to extend the maturity date.

On September 8, 2020, the fair value of the Note was $ 6.1 million, based on a Monte Carlo model with various inputs, including the Tonogold common share price of $ 0.35 , volatility of 96 %, risk-free rate of 0.15 %, cost of debt of 11.12 %, required conversion premium of 30 %, probability of prepayment of 5 %, probability of change of control of 5 % and probability of default of 27 %.

September 8, 2020, the fair value of the Note was $ 6.1 million, based on a Monte Carlo model with various inputs, including the Tonogold common share price of $ 0.35 , volatility of 96 %, risk-free rate of 0.15 %, cost of debt of 11.12 %, required conversion premium of 30 %, probability of prepayment of 5 %, probability of change of control of 5 % and probability of default of 27 %.

At December 31, 2021, the fair value of the Tonogold Note was $ 7,255,000 based on probability weighted fair value with several scenarios, including a 10 % probability of Tonogold repayment upon maturity, a 10 % probability of Tonogold defaulting on the Note, a 75 % probability of a swap of the collateral to us prior to maturity with exercise of an option to repurchase the assets, and a 5 % probability of a swap of the collateral to us prior to maturity and assuming no exercise of the option to repurchase.

Under scenario 1, the value of $ 7,198,000 was derived from a Monte Carlo model with the following inputs:

Tonogold common share price - $ 0.11 ;

volatility – 61 %;

risk free rate – 0.06 %;

cost of debt – 20 %;

conversion premium – 30 %;

probability of prepayment – 5 % at both March and June 2021;

probability of change in control – 0% at December 2021;

probability of default is considered separately in other scenarios at December 31, 2021.

The Company recorded a loss of $ 418,500 for the change in fair value in other expense in the consolidated statements of operations for the year ended December 31, 2021.

Under scenario 2, we assumed default upon the March 2022 maturity date and a 24 month term for the settlement process, with an assumed settlement of $ 10,550,401 in March 2024.

The settlement amount represents the outstanding principal and interest obligation on the note.

A yield assumption of 20 % was applied to the settlement amount.

The value of scenario 2 was $ 7,000,000 .

Under scenario 3, we assumed the Lucerne mine and related assets would be sold back to us, with Tonogold paying $ 750,000 at the maturity date of the Note (the "Swap") with a call option issued to Tonogold whereby the assets could be repurchased at the end of 2022 for $ 7,500,000 .

A discount rate of 25 % was applied in this scenario, reflecting the rates of return on venture capital investments.

We assumed Tonogold exercised the option in this scenario.

The value of scenario 3 was $ 6,709,000 .

Under scenario 4, we assumed the Swap in scenario 3 and no exercise of the option by Tonogold to repurchase the assets.

We assumed a 24 month process to sell the assets to an investor for $ 30,000,000 , which is similar to the purchase price of the assets to Tonogold in 2020.

A discount rate of 25 % was applied in this scenario, reflecting rates of return on venture capital investments.

The value of scenario 4 was $ 16,069,000 .

The probability factors were applied to each scenario and the resulting value of the Note at December 31, 2021 was $ 7,255,000 .

The significant unobservable inputs used in the fair value measurement of the Tonogold Note are the probability factors applied to each scenario and the settlement amounts and timing.

Significant increases or decreases in any of these inputs in isolation may have resulted in a significantly higher or lower fair value measurement.

At December 31, 2020, the fair value of the Tonogold Note was $ 5.5 million based on a Monte Carlo model with the following inputs:

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The Company recorded a loss of $ 0.6 million for the change in fair value in other expense in the consolidated statements of operations for the year ended December 31, 2020.

The Tonogold Note is classified within Level 3 of the valuation hierarchy.

MCU Derivative Asset

On December 4, 2020, the Company recorded a derivative asset on the consolidated balance sheets in connection with its $ 2.0 million purchase of 15 % of MCU membership interests.

On that date, the $ 271,377 fair value of the derivative asset was determined based on the excess of the value of 625,000 shares of the Company’s common stock issued to and held by MCU over $ 384,873 of the purchase price.

The value of the shares was based on the $ 1.05 closing price per share of the Company’s common stock on that date.

At December 31, 2020, the $ 265,127 fair value of the derivative asset is based on the same number of shares and portion of the purchase price, and the $ 1.04 closing price per share of the Company’s common stock.

The derivative asset is classified within Level 2 of the valuation hierarchy.

Eclipse Common Shares

During 2020, the Company sold certain mining claims in exchange for 100,000 shares of common stock of Eclipse Gold Mining Corporation (“Eclipse”).

The fair value of the Company’s investment in common shares of Eclipse is based on the closing price per share of the stock less a discount for a trading restriction on the investment.

Upon receipt of the shares, the fair value of the Company’s investment was based on the $ 0.57 closing price per share of the stock with a discount of $ 5,200 calculated based on a holding period of 0.34 years, risk-free rate of 0.09 % and volatility of 78.0 %.

December 31, 2020, the fair value of the Company’s investment is based on the $ 0.43 closing price per share of the stock with a discount of $ 3,010 calculated based on a holding period of 0.17 years, risk-free rate of 0.08 % and volatility of 74.0 %.

The Eclipse common shares are classified within Level 2 of the valuation hierarchy.

The Tonogold Note was classified within Level 3 of the valuation hierarchy at the year ended December 31, 2020.

Tonogold Contingent Forward

On March 20, 2020, Tonogold issued a senior secured convertible note with a principal amount of $ 5,475,000 to the Company, reflecting Tonogold’s intent to purchase additional membership interests in Comstock LLC (Note 2) in the future at a specified price (the “Contingent Forward”).

On March 20, 2020, Tonogold issued to the Company a senior secured convertible note with a principal amount of $ 5,475,000 reflecting Tonogold’s intent to purchase additional membership interests in Comstock Mining LLC (see Note 2, Acquisitions and Investments ) in the future at a specified price.

The Contingent Forward included the following features:

1) conversion feature allowing Comstock, at the Company’s sole option, to elect payment in Tonogold common shares upon certain events;

1) conversion feature allowing Comstock, at our sole option, to elect payment in Tonogold common shares upon certain events;

2) change of control redemption right allowing Comstock, to redeem the note in cash at a 125 % premium;

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and 4) a payment modification included in the Contingent Forward.

The fair value of the Contingent Forward at inception on March 20, 2020 was based on a Monte Carlo model with various inputs.

These inputs include the Tonogold common share price of $ 0.22 , volatility of 96.0 %, risk-free rate of 0.26 %, cost of debt of 18.23 %, required conversion premium of 30.0 %, probability of prepayment of 0 %, probability of change in control of 5 % and probability of default of 32 %.

As of September 8, 2020, these inputs include the Tonogold common share price of $ 0.35 , volatility of 96.0 %, risk-free rate of 0.15 %, cost of debt of 11.12 %, required conversion premium of 30.0 %, probability of prepayment of 5 %, probability of change in control of 5 % and probability of default of 27 %.

The Company recorded a change in fair value of the Contingent Forward of $ 0.8 million in other income in the consolidated statements of operations for the year ended December 31, 2020.

The contingent forward asset was netted against the gain on sale of Comstock LLC recorded for the year ended December 31, 2020.

Accrued Make Whole for Pelen

The accrued make whole was valued based on the difference between the valuation of the outstanding shares held by the seller of the membership interests at the volume-weighted price per share for five consecutive trading days preceding the date of determination of $ 0.47 at December 31, 2019.

The Pelen Make Whole liability was classified within Level 2 of the valuation hierarchy.

In April 2020, the Company purchased the membership interest in Pelen LLC, settling all amounts due.

Accrued Make Whole for MCU

At December 31, 2019, the accrued make-whole was valued based on the difference between the value of the outstanding shares delivered to MCU at the $ 0.44 closing price per share of the Company's common stock and the required investment value of $ 850,000 .

The MCU make whole liability was classified within Level 2 of the valuation hierarchy.

On December 4, 2020, the 625,000 remaining common shares held by MCU became transferable and the parties agreed the make whole obligation had been satisfied.

The fair value of the Contingent Forward was based on a Monte Carlo model with various inputs.

These inputs included the Tonogold common share price of $ 0.35 on September 8, 2020, volatility of 96.0 %, risk-free rate of 0.15 %, cost of debt of 11.12 %, required conversion premium of 30.0 %, probability of prepayment of 5 %, probability of change in control of 5 % and probability of default of 27 %.

We recorded a change in fair value of the Contingent Forward of $ 0.8 million in other income in the consolidated statements of operations for the year ended December 31, 2020.

The contingent forward asset was netted against the gain on sale of Comstock Mining LLC recorded for the year ended December 31, 2020.

Tonogold Convertible Preferred Shares

The consideration received for Tonogold's acquisition of Comstock Mining LLC included shares of the Tonogold CPS.

Since the CPS were not listed securities, and had no readily available market, we elected the fair value option for this instrument.

The value of the CPS at December 31, 2020 was based on 120 % of par value as a result of several factors, which made it likely that Tonogold would be able to apply the redemption provision of the CPS.

We recorded $ 2,544,000 in gain (loss) on investments in other income and expense related to the changes in fair value of the CPS in the consolidated statements of operations year ended December 31, 2020.

LINICO Derivative Instruments

On February 15, 2021, we recorded a derivative asset on the consolidated balance sheets in connection with the LINICO Stock Purchase Agreement.

On that date, the February 15, 2021, the fair value of the derivative asset was determined based on the excess of the fair value of 3,000,000 shares of our common stock issued to and held by LINICO over the $ 6,250,000 contractual consideration required under the agreement.

The fair value of the shares was based on the $ 2.25 closing price per share of our common stock on that date.

The increase in fair value of $ 2,049,966 was recognized as a change in fair value of the derivative instruments in the consolidated statements of operations for the year ended December 31, 2021.

On December 30, 2021, the Company entered into an agreement to acquire 3,129,081 LINICO common shares from its former chief executive officer and director in exchange for 3,500,000 Comstock Shares.

If and to the extent that the sale of the LODE Shares results in net proceeds greater than $ 7,258,162 , then former chief executive officer is required to pay all of such excess proceeds to the Company.

If and to the extent that the sale of the Comstock Shares results in net proceeds less than $ 7,258,162 , then the Company is required to pay the former chief executive officer equal to such shortfall.

At December 31, 2021, the fair value of the shares was based on the closing price per share of our common stock of $ 1.29 .

The resulting shortfall of $ 2,743,162 was recognized as a derivative liability in the consolidated balance sheet and change in fair value of derivative instruments in the statement of operations at and for the year ended December 31, 2021.

GenMat Derivative Instruments

On June 24, 2021, we recorded a derivative asset on the consolidated balance sheets in connection with the GenMat Membership Interest Purchase Agreement.

On that date, the $ 530,000 fair value of the derivative asset was determined based on the excess of the fair value of 3,000,000 shares of our common stock issued to and held by GenMat over the $ 10,000,000 contractual stock consideration required under the agreement.

The value of the shares was based on the $ 3.51 closing price per share of our common stock on that date.

At December 31, 2021, the $ 6,130,000 fair value of the derivative liability is based on the same number of shares and the $ 1.29 closing price per share of our common stock on that date.

The decrease in fair value of $ 6,660,000 was recognized as a change in fair value of the derivative instruments in the consolidated statements of operations for the year ended December 31, 2021.

The derivative liability is classified within Level 2 of the valuation hierarchy.

LPB Derivative Instrument

On July 23, 2021, we recorded a derivative asset on the consolidated balance sheets in connection with the LPB Contribution Agreement.

On that date, the $ 6,642,000 fair value of the derivative asset was determined based on the excess of the fair value of 3,500,000 shares of our common stock issued to and held by LPB over the $ 4,173,000 fair value of our contractual consideration under the LPB Partnership Interest Purchase Agreement.

The value of the shares was based on the $ 3.09 closing price per share of our common stock on that date.

At December 31, 2021, the $ 342,000 fair value of the derivative asset is

based on the same number of shares and the $ 1.29 closing price per share of our common stock on that date.

The decrease in fair value of $ 6,300,000 was recognized as a change in fair value of the derivative instruments in the consolidated statements of operations for the year ended December 31, 2021.

The derivative liability is classified within Level 2 of the valuation hierarchy.

MCU Derivative Instrument

On December 4, 2020, the Company recorded a derivative asset on the consolidated balance sheets in connection with its $ 2.0 million purchase of 15 % of MCU membership interests.

At December 31, 2020, the $ 271,377 fair value of the derivative asset was based 625,000 shares of the our common stock issued as a portion of the purchase price, and the $ 1.04 closing price per share of our common stock.

During the year ended December 31, 2021, MCU sold 625,000 shares, resulting in a final derivative asset fair value of $ 762,377 based on the excess of actual net proceeds and cash payments to MCU over the $ 2,000,000 purchase price.

We received a cash payment of $ 762,377 from MCU in February 2021 in full satisfaction of any excess proceeds from the sale of the stock, which was applied to the derivative asset, resulting in no remaining fair value at December 31, 2021.

The increase in fair value of $ 497,250 for the change in fair value of the derivative instruments in the consolidated statements of operations for the year ended December 31, 2021.

The derivative liability is classified within Level 2 of the valuation hierarchy.

Other Financial Instruments

The carrying amount of cash and cash equivalents and trade payables approximates fair value because of the short-term maturity of these financial instruments.

At December 31, 2020, and December 31, 2019, the fair value of long-term debt approximated $ 3.6 million and $ 5.1 million, respectively, as determined by borrowing rates estimated to be available to the Company for debt with similar terms and conditions.

The fair value of assets and liabilities with carrying values approximating fair value is determined using Level 2 inputs, with the exception of cash and cash equivalents (Level 1).

Stock-Based Compensation

At December 31, 2021, the carrying amount of cash and cash equivalents and notes receivable carried at amortized costs, approximates fair value because of the short-term maturity of these financial debt.

ASSETS AND LIABILITIES MEASURED AT FAIR VALUE ON A NONRECURRING BASIS

Following is a description of the valuation methodologies used in determining the fair values of the nonrecurring stock purchase price consideration and intangible assets recorded in connection with the three acquisitions completed during the year ended December 31, 2021, all of which are classified within Level 3 of the valuation hierarchy

PSI Stock Purchase Price Consideration

On September 7, 2021, the Company entered into and closed under a Securities Exchange Agreement with the shareholders of Comstock Innovations Corporation (F/K/A Plain Sight Innovations Corporation) (“Comstock Innovations”), in order to acquire 100 % of the issued and outstanding equity of the Company, in exchange for 8,500,000 restricted shares of the Company’s common stock with a fair value of $ 14,952,806 .

Such shares are subject to transfer restrictions, of which 28 % will be released from the Lock-Up 180 days after closing, and the remaining 72 % will be released in eight (8) equal installments of 9 % every six months thereafter.

In determining the fair value of the shares issued, we assessed the lack of marketability of the shares issued utilizing the European and Asian Protective Put Models and, in order to estimate the volatility for Comstock's future business, we evaluated selected guideline companies from the same industry to determine discounts for lack of marketability associated with the lockup restrictions of 18.2 % for the six-month lockup and 54.0 % for the longer-term lockups.

Related inputs for the six-month lockup include stock price $ 1.00 , exercise price $ 1.00 , term 0.5 years, volatility 101.3 %, risk free rate 0.05 % and dividend yield 0.0 %.

Related inputs for the longer-term lockups include stock price $ 1.00 , exercise price $ 1.00 , term 2.5 years, volatility 130.5 %, risk free rate 0.30 % and dividend yield 0.0 %.

The purchase price consideration is classified within Level 2 of the valuation hierarchy.

Comstock Innovations Intangible Assets

The Company’s intangible assets acquired from PSI consist of technology-related assets, including third-party license agreements and internally developed technology.

Because adequate information is not available to determine the fair value of one of the license agreements using income (economic benefit stream) or market (comparable assets) valuation approaches, the fair values are based on a cost approach (to replace the future service capability of the asset) and an 80.0 % opportunity cost to negotiate the agreement over a one-month period, resulting in an estimated fair value of $ 10,800 .

The second license agreement has been recorded at the cost of the minimum license fee less amortization, resulting in an estimated fair value of $ 483,333 .

The estimated fair value of the internally developed technology is based on the relief from royalty approach, estimating the present value of related future cash flows after tax discounted at an estimated 80.0 % per annum weighted average cost of capital, resulting in an estimated fair value of $ 6,579,400 .

All three intangible assets are being amortized on a straight line basis over their 10-year estimated useful lives.

The intangible assets are classified within Level 3 of the valuation hierarchy.

MANA Stock Purchase Price Consideration

On July 23, 2021, we entered into a Securities Purchase Agreement to purchase 100 % of MANA equity and voting shares from the former shareholders of MANA.

Under the agreement, the purchase price was paid through the issuance of 4,200,000 restricted shares of our common stock to the former shareholders, with an estimated fair value of $ 6,528,453 .

The restricted shares issued are subject to lockup provisions wherein 28 % of the restricted shares are released from resale restrictions $180 days, or six months, after the closing.

The remaining 72 % of the restricted shares are released from resale restrictions in eight equal installments of 9 %% every six months thereafter.

In determining the fair value of the shares issued, we assessed the lack of marketability of the shares issued utilizing the European and Asian Protective Put Models and, in order to estimate the volatility for Comstock's future business, we evaluated selected guideline companies from the same industry to determine discounts for lack of marketability associated with the lockup restrictions of 39.4 % for the six-month lockup and 53.7 % for the longer-term lockups.

Related inputs for the six-month lockup include stock price $ 1.00 , exercise price $ 1.00 , term 0.5 years, volatility 209.9 %, risk free rate 0.05 % and dividend yield — %.

Related inputs for the longer-term lockups include stock price $ 1.00 , exercise price $ 1.00 , term 2.5 years, volatility 129.6 %, risk free rate 0.30 % and dividend yield — %.

The purchase price consideration is classified within Level 2 of the valuation hierarchy.

RPS Stock Purchase Price Consideration

On June 18, 2021, we entered into a Securities Purchase Agreement to purchase 100 % of RPS equity and voting shares from the former shareholder of RPS.

Under the agreement, the purchase price is paid through the issuance of 1,000,000 restricted shares of our common stock to the former shareholder, with an estimated fair value of $ 2,304,806 .

The restricted shares issued are subject to lockup provisions wherein 28.0 % of the restricted shares are released from resale restrictions 180 days, or six months, after the closing.

The remaining 72.0 % of the restricted shares are released from resale restrictions in eight equal installments of 9.0 % every six months thereafter.

In determining the fair value of the shares issued, we assessed the lack of marketability of the shares issued utilizing the European and Asian Protective Put Models and, in order to estimate the volatility for Comstock's future business, we evaluated selected guideline companies from the same industry to determine discounts for lack of marketability associated with the lockup restrictions of 26.2 % for the six-month lockup and 37.5 % for the longer-term lockups.

Related inputs for the six-month lockup include stock price $ 1.00 , exercise price $ 1.00 , term 0.5 years, volatility 142.4 %, risk free rate 0.06 % and dividend yield — %.

Related inputs for the longer-term lockups include stock price $ 1.00 , exercise price $ 1.00 , term 2.49 years, volatility 90.8 %, risk free rate 0.36 % and dividend yield — %.

The purchase price consideration is classified within Level 2 of the valuation hierarchy.

RPS Intangible Assets

RPS intangible assets acquired consist of technology-related and contract-related assets.

The technology-related asset is a third-party license agreement with an estimated fair value of $ 16,619 , and the contract-related assets include a third-party distribution agreement with an estimated fair value of $ 19,733 , and a customer contract with an estimated fair value of $ 122,885 .

Because adequate information is not available to determine the fair values of the license and distribution agreements using income (economic benefit stream) or market (comparable assets) valuation approaches, their fair values are based on a cost approach (to replace the future service capability of the assets) and an 11.8 % opportunity cost to negotiate the agreements over a six-month period.

The fair values of the license and distribution agreements are being amortized on a straight line basis over their estimated 24 and 79 month estimated useful lives, respectively.

The fair value of the customer contract is based on the income approach, estimating the present value of related future cash flows after tax discounted at an estimated 11.8 % per annum weighted average cost of capital.

The customer contract is being amortized on a straight line basis over the estimated nine-month period to complete the related services.

The intangible assets are classified within Level 3 of the valuation hierarchy.

LINICO Intangible Assets

LINICO intangible assets acquired consist of internally developed technology with an estimated fair value of $ 11,803,000 , a lease intangible related to a purchase option with an estimated fair value of $ 3,621,488 , and a trademark with an estimated fair value of $ 7,000 .

The estimated fair value of the internally developed technology is based on a relief from royalty method, with estimated revenue over 12 years, attrition of 8.3 %, gross royalty charges of 7 % and a discount rate of 74.0 %.

The lease intangible is based on a Black Scholes model with an estimated fair value of the battery recycling facility of $ 17,130,000 , a purchase option price of $ 14,250,000 , a term of 0.8 years, a risk-free rate of 0.29 % and volatility of 21.6 %.

The trademark is valued based on a cost model, which includes attorney advice and preparation of the trademark application, plus filing costs.

The developed technology and trademark will be amortized on a straight line basis over their 10 -year estimated useful lives and the lease intangible will be amortized on a straight-line basis over its 10 -month estimated useful life.

Intangible assets of $ 15,431,488 were recognized upon acquisition based on their relative fair value to the fair value of other net assets acquired.

The intangible assets are classified within Level 3 of the valuation hierarchy.

NOTE 16 STOCK-BASED COMPENSATION

2020 EQUITY INCENTIVE PLAN

In 2020, the Company adopted the Comstock Mining Inc.

2020 Equity Incentive Plan (the “2020 Plan”).

The maximum number of shares of the Company’s common stock that may be delivered pursuant to awards granted under the 2020 Plan is 1,800,000 , including the 540,000 shares granted to Non-executive directors and vesting in three equal increments of 180,000 shares each on January 1, 2022, January 1, 2023 and January 1, 2024.

The remaining availability under the 2020 Plan is 1,260,000 shares.

The plan provides for the grant of various types of awards, including but not limited to restricted stock (including performance awards), restricted stock units, stock options, and other types of stock-based awards.

On December 30,2020, Comstock’s Board of Directors resolved to grant certain share-based compensation payable to the board members, in lieu of cash, in consideration of future board service to the Company.

These share-based payments are granted under the approved 2020 Equity Compensation Plan.

Non-executive board members were granted a total of 540,000 shares of common stock on December 30, 2020, vesting in three equal increments of 180,000 shares each on January 1, 2022, January 1, 2023 and January 1, 2024.

The fair value of the common shares issued was $ 1.06 per share, based on the Company's closing price on December 30, 2020.

Compensation cost totaling $ 572,400 will be recognized straight line over the three years vesting period.

No stock compensation was recognized in connection with these shares for the year ended December 31, 2020.

As of December 31, 2020, there are 1,260,000 shares available for issuance under the 2020 plan.

2020 Equity Incentive Plan (“2020 Plan”).

The maximum number of shares of our common stock that may be delivered pursuant to awards granted under the 2020 Plan is 1,800,000 .

The plan provides for the grant of various types of grants, including but not limited to restricted stock (including performance awards), restricted stock units, stock options, and other types of stock-based compensation.

In December 2020, 540,000 shares were granted to non-executive directors under the 2020 Plan, which vest in three equal increments of 180,000 shares each on January 1, 2022, January 1, 2023 and January 1, 2024.

The fair value of the common shares issued was $ 1.06 per share, based on the closing price of our common stock on December 30, 2020.

Compensation expense for these grants totaling $ 572,400 and will be recognized on a straight-line basis over the three year vesting period.

Compensation expense for these grants totaling $ 190,800 was recorded as a selling, general and administrative expense in the consolidated statements of operations for the year ended December 31, 2021.

Unamortized stock-based compensation of $ 381,600 at December 31, 2021 will be amortized over the remaining 24 months vesting term.

In 2021, we granted, 1,170,000 performance shares to employees under the 2020 Plan.

The vesting of 50 % of the employee performance share awards is contingent on the achievement of performance goals over the next three years , and vesting of the remaining 50 % is contingent on the achievement of our common stock market price goals over the next five years , defined on a per share basis.

Vesting is dependent on the employee remaining with the Company from the grant date through the vesting date.

The performance shares that vest based on the achievement of performance goals were valued using the Company's common stock price on the grant date, and stock-based compensation was determined based on the probability of achieving each goal.

The performance vesting based on the Company share price were valued using a path-dependent model with the following inputs:

January 4, 2021 June 8, 2021 July 12, 2021 August 30, 2021

Total shares granted 1,055,000 60,000 25,000 30,000

Performance condition valuation inputs:

Performance condition shares 527,500 30,000 12,500 15,000

Stock price at grant date $ 1.10 $ 3.51 $ 3.17 $ 3.04

Market condition valuation inputs:

Market condition shares 527,500 30,000 12,500 15,000

Beginning stock price $ 1.10 $ 3.51 $ 3.17 $ 3.04

Volatility 77 % 93 % 93 % 95 %

Risk-free rate 0.36 % 0.79 % 0.71 % 0.65 %

Number of iterations 100,000 100,000 100,000 100,000

Fair value per share $ 0.41 $ 2.71 $ 2.38 $ 2.26

Term (in years) 3.2 1.7 1.8 1.8

Stock-based compensation for all employee performance share grants totaling $ 273,186 was recorded in the consolidated statements of operations for the year ended December 31, 2021.

At December 31, 2021, unamortized stock-based compensation for performance goals-based grants of $ 605,451 will be amortized over the remaining 24 months vesting term, and the $ 253,363 associated with market price-based grants will be amortized over the remaining 26 months, 12 months and 15 months derived vesting terms, as applicable.

No shares have vested at December 31, 2021.

2011 EQUITY INCENTIVE PLAN

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The maximum number of shares of the Company’s common stock that could be delivered pursuant to awards granted under the 2011 Plan was 1,200,000 .

There is no availability of shares under the 2011 Plan.

The plan provided for the grant of various types of awards, including, but not limited to, restricted stock (including performance awards), restricted stock units, stock options, and other types of stock-based awards.

On May 28, 2020, Comstock’s Board of Directors resolved to grant certain share-based compensation payable to non-executive board members, in lieu of cash, in consideration of certain past and current service to the Company and also resolved to grant certain share-based compensation to members of management, including the chief executive officer and other key employees of the Company, in consideration of service to the Company.

These share-based payments were granted under the previously approved 2011 Equity Compensation Plan.

The grant date for both the shares and the options is May 28, 2020.

Non-executive board members were granted a total of 135,000 common shares for past services and 180,000 common shares for current services for a total of 315,000 common shares.

The 2011 Plan expired June 23, 2021.

At December 31, 2021, there are no shares available to be issued under the plan.

In May 2020, non-executive board members were granted a total of 135,000 common shares for past services and 180,000 common shares for current services for a total of 315,000 common shares.

The fair value of the common shares issued was $ 0.56 per share, based on the closing price of the Company's common shares on May 28, 2020.

Compensation cost totaling $ 176,400 was recorded as a general and administrative expense in the consolidated statements of operations for the year ended December 31, 2020.

Employees were granted 138,800 fully vested options to acquire common shares with an exercise price equal to the closing price of the Company's common shares on the date of the grant, or $ 0.56 per share, and expiring on the second anniversary of the grant.

Also in May 2020, employees were granted 138,800 fully vested options to acquire common shares with an exercise price equal to the closing price of our common stock on the date of the grant and expiring on the second anniversary of the grants.

Fair value of stock options was calculated using a Black-Scholes model with the following inputs:

stock price on the grant date and exercise price - $ 0.56 per share;

stock price on the grant date and exercise price of - $ 0.56 per share;

expected term - 1 year;

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Based on these inputs, the fair-value option price is $ 0.20 per share.

Compensation cost for the options issued totaled $ 27,849 and was recorded in the consolidated statements of operations for the year ended December 31, 2020.

There were no options issued or outstanding for the year ended December 31, 2019.

No options were exercised from the date of issuance through December 31, 2020.

The intrinsic value of these options was $ 66,624 at December 31, 2020.

As of December 31, 2020, there are no other outstanding grants and no remaining shares available for issuance under the 2011 plan.

The Company recognizes forfeitures under the 2011 and 2020 Plans as they occur.

Other Income and Expense

Compensation expense for the stock options issued totaled $ 27,849 and was recorded as additional paid in capital on the consolidated balance sheets for the year ended December 31, 2020.

During 2021, 66,150 of the stock options have been repurchased and cancelled in lieu of being exercised.

Cash paid for the stock options totaling $ 247,156 for the year ended December 31, 2021 was deemed to be the incremental fair value of the stock options at the repurchase date, and was recorded as a reduction in additional paid-in capital on the consolidated balance sheets.

At December 31, 2021, the intrinsic value of the remaining 72,650 stock options outstanding was $ 53,035 .

NOTE 17 OTHER INCOME AND EXPENSES

Other income (expense) net consisted of the following for the years ended December 31, 2021 and 2020:

Change in fair value of contingent forward asset $ 765,880 $ —

Change in fair value of derivative asset related to Mercury Clean Up LC 265,127 —

Change in fair value of make whole liabilities 261,661 —

Gain on sale of mining claims 152,000 —

12/31/21 12/31/20

Impairment of LPB related assets ( 1,076,258 ) —

Equity loss in affiliates ( 2,049,070 ) ( 2,131 )

Tonogold reimbursement of Pelen LLC acquisition costs — 234,944

Change in fair value of Tonogold preferred shares — ( 2,544,000 )

Change in value MCU make whole — ( 452,740 )

Preferred shares issuance cost — ( 432,000 )

Realized gain on sale of Tonogold common shares 1,528,069 —

Change in fair value Tonogold note receivable ( 418,500 ) ( 642,997 )

Unrealized gain on investments in securities 1,624,633 —

Tonogold note receivable amendment fee income 362,500 —

Writedown of uncollectible receivable ( 300,000 ) —

Recognition of grant from CARES Act PPP loan — 261,170

Gain on termination of Tonogold option agreement — 2,200,000

LINICO dividend income 426,763 —

Other 75,202 425,185

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On April 30, 2020, the Company received a Paycheck Protection Program (“PPP”) grant of $ 261,170 , as part of the Coronavirus Aid, Relief, and Economic Security Act (the "CARES Act"), and the rules promulgated thereunder.

The amounts received were used to fund payroll and other qualifying costs and the Company expects all proceeds received to be forgiven.

Due to ongoing losses and available income tax carryforwards, no tax provision (benefit) has been recognized during the years ended December 31, 2020 and 2019.

The provision (benefit) for income taxes from continuing operations for the years ended December 31, 2020 and 2019 consist of the following:

The amounts received were used to fund payroll and other qualifying costs and the all proceeds received were forgiven during 2021 .

NOTE 18 INCOME TAXES

The results of the Company’s operations are included in a federal income tax return.

The Company provides deferred income taxes on the net differences between the carrying amounts of assets and liabilities for financial and income tax reporting.

The difference between the provision for income taxes reported in the consolidated financial statements and the provision for income taxes based on federal statutory rates results principally from 1) valuation allowance adjustments, 2) goodwill impairment and 3) certain other permanent differences.

The provision for income taxes for the years ended December 31, 2021 and December 31, 2020 consisted of the following:

12/31/21 12/31/20

Current provision:

Federal $ — $ —

Total current provision — —

Deferred provision (benefit) for tax:

Federal - due to acquisition of intangibles ( 5,748,105 ) —

Total deferred provision (benefit) for tax ( 5,748,105 ) —

Total provision for tax $ ( 5,748,105 ) $ —

Reconciliation of the statutory federal income tax rates consist of the following :

12/31/21 12/31/20

Federal statutory rate ( 21.0 ) % ( 21.0 ) %

Goodwill impairment 4.3 % — %

Change in valuation allowance ( 1.6 ) % 21.3 %

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Total ( 19.0 ) % — %

Deferred income taxes at December 31, 2020 and 2019 consisted of the following:

The Company’s total deferred income taxes at December 31, 2021 and 2020 consisted of the following:

12/31/21 12/31/20

Asset retirement obligation $ 1,143,591 $ 1,259,361

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Mining exploration, development, claims, and permit costs 335,572 174,122

Deferred gain on membership sales proceeds — 2,525,250

Lease liability 2,739,135 —

Net operating loss carryforward 41,897,036 40,316,072

Capital loss carryforward — 655,780

Mark-to-market adjustments 3,697,424 —

Other 453,712 88,841

Total deferred tax asset 51,438,877 43,727,550

Valuation allowance ( 43,102,265 ) ( 43,579,484 )

Total net deferred tax assets $ — $ —

At December 31, 2020, the Company has net operating loss carryforwards of approximately $ 168.2 million for federal income tax purposes which, if not utilized, will begin to expire in 2024 and could be subject to certain limitations under section 382 of the Internal Revenue Code.

Additionally, as of December 31, 2020, the Company has net operating loss carryforwards of approximately $ 23.8 million for federal income tax purposes with no expiration, but which are subject to 80 % limitation upon utilization.

At December 31, 2020, the Company had capital loss carryforwards of approximately $ 3.1 million that will expire after 2025.

Net deferred tax assets 8,336,612 148,066

Deferred tax liabilities:

Right of use asset – leases ( 2,739,135 ) —

Mark-to market adjustments — ( 148,066 )

Intangible assets ( 5,597,477 ) —

Total deferred tax liabilities ( 8,336,612 ) —

Net deferred tax assets and liabilities $ — $ 148,066

The Company records a valuation allowance if, based on the weight of all available evidence, it is more likely than not that some or all of the deferred tax assets will not be realized.

As of December 31, 2020, and 2019, the Company has determined that a full valuation allowance is necessary against its net deferred tax assets based on the weight of all available evidence.

The resulting valuation allowance recorded against the net deferred tax assets of the Company is $ 43.6 million and $ 46.8 million as of December 31, 2020, and 2019, respectively.

The CARES Act was enacted on March 27, 2020.

The CARES Act, among other things, includes provisions relating to refundable payroll tax credits, deferment of employer side payroll tax, Paycheck Protection Program, net operating loss carryback periods, alternative minimum tax credit refunds, and modifications to the net interest deduction limitations.

The most significant impact to the Company from the CARES Act relates to the Paycheck Protection Program.

As of December 31, 2020, and 2019, the Company did not have any unrecognized tax benefits.

A portion of the change is due to net operating losses released due to acquisitions.

At December 31, 2021, and 2020, the Company has determined that a full valuation allowance is necessary against its net deferred tax assets based on the weight of all available evidence.

The resulting valuation allowance recorded against the net deferred tax assets of the Company is $ 43.1 million and $ 43.6 million at December 31, 2021, and 2020, respectively.

At December 31, 2021, the Company has net operating loss carryforwards of approximately $ 168.2 million for federal income tax purposes which, if not utilized, will begin to expire in 2024 and could be subject to certain limitations under section 382 of the Internal Revenue Code.

Additionally, at December 31, 2021, the Company has net operating loss carryforwards of approximately $ 31.3 million for federal income tax purposes with no expiration, but which are subject to 80 % limitation upon utilization.

At December 31, 2021, the Company had no capital loss carryforwards.

At December 31, 2021, and 2020, the Company did not have any unrecognized tax benefits.

The Company’s policy is to recognize interest and penalties related to income tax matters in income tax expense.

The Company currently has no federal or state tax examinations in progress nor has it had any federal or state tax examinations since its inception.

The Company currently has no federal or

state tax examinations in progress nor has it had any federal or state tax examinations since its inception.

The Company is subject to U.S.

federal and state income tax examination for tax years 2019 and forward.

Net Income (Loss) Per Common Share

Tax returns for years prior to 2018 may remain open with respect to net operating loss carryforwards that are utilized in a later year, as tax attributes from prior years can be adjusted during an audit of a later year.

NOTE 19 NET INCOME (LOSS) PER COMMON SHARE

Basic earnings per share is computed by dividing net income (loss) available to common shareholders by the weighted average number of shares of common stock outstanding during the period.

Diluted income (loss) per share reflects the potential dilution that could occur if outstanding stock options were exercised into common stock.

For the years ended December 31, 2021, and 2020, we had no common stock equivalent shares that were dilutive.

The following is a reconciliation of the numerator and denominator used in the basic and diluted computation of net loss per share:

12/31/21 12/31/20

Net income (loss) attributable to Comstock Mining Inc.

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Diluted EPS $ ( 0.49 ) $ 0.49

For the year ended December 31, 2020, common stock equivalent shares consisted of stock options and were included in the calculation of dilutive earnings per share.

During the year ended December 31, 2019, the Company had no common stock equivalent shares.

Segment Reporting

Our management organizes the Company into two operating segments, mining and real estate.

Our mining segment consists of all activities and expenditures associated with mining, exploration and mine development.

Our real estate segment consists of land, real estate rental properties, including the Gold Hill Hotel and the Daney Ranch.

We evaluate the performance of our operating segments based on income (loss) from operations.

All intercompany transactions have been eliminated.

Financial information relating to our reportable operating segments and consolidated totals follows:

Mining $ — $ —

Real estate 201,700 179,632

Total revenues 201,700 179,632

Cost and Expenses

Mining $ ( 4,873,654 ) $ ( 5,486,523 )

Real estate ( 802,307 ) ( 37,562 )

Total cost and expenses ( 5,675,961 ) ( 5,524,085 )

Income (Loss) From Operations

Mining $ ( 4,873,654 ) $ ( 5,486,523 )

Real estate ( 600,607 ) 142,070

Total loss from operations ( 5,474,261 ) ( 5,344,453 )

Other income (expense), net 20,406,231 1,538,586

The weighted average number of shares outstanding, for the purpose of calculating earnings per share, were reduced by 2,694,300 , which is the number of shares deemed to be owned by us through our ownership in LINICO.

NOTE 20 SEGMENT REPORTING

We have the following segments and reporting units:

production and sale of renewable energy products and strategic and other investments.

Summarized financial information relating to our reportable segments is provided below.

Certain amounts have been reclassified to conform to the current period presentation, most notably to reclassify our historical activities to our all other segment.

We have created a new operating segment, renewable energy products, which includes our new technologies and the resulting renewable energy products.

Our strategic and other investments segment includes all other activities, including real estate, mining, equity method investments and general corporate costs.

Strategic and other investments revenue is from real estate activities.

At December 31, 2021:

Renewable Energy Products:

Strategic and Other Investments Inter-segment Elimination Total

Revenue from external customers $ 634,042 228,123 $ — $ 862,165

Inter-segment revenue 371,900 — ( 371,900 ) —

Total segment revenue 1,005,942 228,123 ( 371,900 ) 862,165

Costs of goods sold:

Costs of goods sold 257,351 14,731 — 272,082

Inter-segment eliminations — — —

Total costs of goods sold 257,351 14,731 — 272,082

Gross Profit 748,591 213,392 ( 371,900 ) 590,083

Operating expenses

Depreciation and amortization 567,520 466,966 — 1,034,486

Other operating expenses 1,982,666 4,350,752 ( 371,900 ) 5,961,518

Total costs and expenses 2,550,186 4,817,718 ( 371,900 ) 6,996,004

Loss from Operations ( 1,801,595 ) ( 4,604,326 ) — ( 6,405,921 )

Other income (expense)

Gain (loss) on investments — ( 2,244,951 ) — ( 2,244,951 )

Interest expense ( 72,194 ) ( 163,651 ) 66,964 ( 168,881 )

Interest income 3,897 1,081,014 ( 66,964 ) 1,017,947

Change in fair value of derivative instruments — ( 13,155,946 ) — ( 13,155,946 )

Equity loss in affiliates — ( 2,049,070 ) — ( 2,049,070 )

Impairment of goodwill and intangible assets ( 6,394,610 ) — — ( 6,394,610 )

Other income (expenses) ( 6,328,429 ) 5,398,136 — ( 930,293 )

Total other income (expense), net ( 12,791,336 ) ( 11,134,468 ) — ( 23,925,804 )

Net income (loss) ( 14,592,931 ) ( 15,738,794 ) — ( 30,331,725 )

Deferred income tax benefit 1,514,303 4,233,802 — 5,748,105

Net income (loss) attributable to Comstock Mining Inc $ ( 13,078,628 ) $ ( 11,504,992 ) $ — $ ( 24,583,620 )

Capital Expenditures:

Mining $ 100,000 $ —

Real estate 30,750 2,436,354

Total capital expenditures $ 130,750 $ 2,436,354

Depreciation, Amortization and Depletion

Mining $ 472,022 $ 1,804,808

Real estate (includes depreciation expense recognized upon reclassification of held for sale assets to held for use assets) 745,195 12,406

Total depreciation, amortization and depletion $ 1,217,217 $ 1,817,214

As of December 31,

Mining $ 34,338,192 $ 30,106,865

Real estate 8,785,370 9,463,027

$ 78,467 $ — $ — $ 78,467

Related Party Transactions

The Company identifies related parties, and accounts for and discloses related party transactions.

Parties, which can be entities

or individuals, are considered to be related if either party has the ability, directly or indirectly, to control or exercise significant influence over the other party in making financial and operational decisions.

Entities and individuals are also considered to be related if they are subject to the common control or significant influence of another party (Note 2).

In addition to related party transactions discussed in Note 2 and Note 11, the following related party transactions occurred during the years ended December 31, 2020 and 2019.

Northern Comstock LLC

The Company has an operating agreement with Northern Comstock LLC ("Northern Comstock"), an entity controlled by a related party.

As part of the operating agreement, the Company obtained the exclusive rights of production and exploration on certain parcels in Storey County, Nevada.

The terms of the operating agreement, as amended, provide the Company make monthly cash capital contributions of $ 30,000 and annual capital contributions in the amount of $ 482,500 payable in stock or cash, at the Company's option, unless the Company has cash or cash equivalents in excess of $ 10.5 million on the date of such payments, whereupon the Company would then be required to pay in cash or in certain circumstances, shares of the Company’s common stock.

The number of shares to be delivered is calculated by dividing the amount of the capital contribution by the volume-weighted average closing price of the Company’s common stock on its primary trading market for the previous 20 consecutive trading days prior to such capital contribution.

The operating agreement also provides for a one-time acceleration of $ 812,500 of the capital contributions payable when the Company receives net cash proceeds from sources other than operations that exceed $ 6,250,000 .

The agreement also includes an ongoing acceleration of the Company’s capital contribution obligations equal to 3 % of NSR generated by the properties subject to the agreement.

The agreement also provides that if the Company defaults in its obligation to make the scheduled capital contributions, then the remaining capital contribution obligations may be converted into the principal amount of a 6 % per annum promissory note payable by the Company on the same schedule as the capital contributions, and secured by a mortgage on the properties and rights owned or controlled by Northern Comstock.

The operating agreement requires that these capital contributions commence in October 2015, and end in September 2027, unless prepaid by the Company.

As of December 31, 2020, the capital contribution obligations of the Company total $ 5.6 million.

For each the years ended December 31, 2020 and 2019, the Company made payments under the Northern Comstock operating agreement in shares of common stock in the amounts of $ 482,500 annually, with the number of shares being, 343,058 and 746,269 , respectively (as adjusted for the November 2019 1-for-5 stock split).

For each year, the Company incurred total expense of $ 0.8 million related to the Northern Comstock contributions.

During the years ended December 31, 2020 and 2019, the Company recognized $ 0.8 million in reimbursements each year from Tonogold for the Northern Comstock payments as a reduction of mine claims and costs in the consolidated statements of operations.

Mercury Clean Up, LLC and MCU Philippines, Inc.

In connection with the Company’s investments in MCU and MCU-P, the Company has provided certain services relating to feasibility studies and permitting that are separate from those investments and not included as obligations under the MCU Agreement.

Subsequent Events

Sierra Springs Opportunity Fund, Inc.

On January 4, 2021, the Company made additional advances to SSOF of $ 1.5 million, used toward deposits for contracted property purchases.

SSOF assigned the Company all rights, title and interest to the extent assignable, in the property purchases, until such time that the advances are repaid.

Performance Share Grants

On January 4, 2021, the Compensation Committee of the Board of Directors of the Company authorized a grant of 1,260,000 performance share units to key employees of the Company.

The Executive Chairman and CEO of the Company was among the recipients of such performance share units, with a grant of 500,000 performance share units.

Vesting of the awards is conditioned upon the achievement of strategic performance objectives of the Company over three years , as described in the Comstock Mining Inc.

2020 Equity Incentive Plan, for half of the award, and achieving a price per share of the Company's common stock of $ 12 or greater for the other half of the award.

Comstock Residents Association

On January 11, 2021, the Nevada Supreme Court issued a final order affirming the District Court's judgment in favor of Lyon County and Comstock.

On January 29, 2021, the CRA filed a Petition for Rehearing to the Nevada Supreme Court.

On February 25, 2021, the Nevada Supreme Court issued an order denying a rehearing.

On March 8, 2021, the CRA petitioned the Nevada Supreme Court for reconsideration.

Tonogold Common Shares Purchase

On January 11, 2021, the Company entered into an agreement with Pieter Busscher for the Company to sell 800,000 shares of its investment in Tonogold common stock at a fixed price of $ 0.31 per share, for proceeds of $ 248,000 .

Mercury Clean Up LLC

In January 2021, MCU sold the 625,000 shares of the Company's common stock for $ 1.1 million, a $ 1.84 average price per share, resulting in excess proceeds of $ 0.8 million, payable to the Company.

On February 25, 2021, the Company received the $ 0.8 million in excess proceeds from MCU and, pursuant to the MCU Agreement, on March 5, 2021 loaned an additional $ 0.8 million to MCU-P, and became entitled to an additional 10 % membership interest in MCU, bringing the Company's total membership interests in MCU to 25 % (Note 2).

Leviston Purchase Agreement

On February 8, 2021, the Company entered into an equity purchase agreement (the “2021 Leviston Sales Agreement”) with Leviston to offer and sell registered shares of common stock at an aggregate offering price of up to $ 5.0 million from time to time, at the Company’s option, on terms deemed favorable to the Company.

The term of the agreement is 24 months.

The Company agreed to deliver to Leviston additional shares of common stock with a fair value of $ 250,000 , for no additional consideration, on the first settlement date with respect to a put notice delivered by the Company.

Purchase of LINICO Preferred Stock

On February 15, 2021, the Company, Aqua Metals Inc., a Delaware corporation (“AQMS”) and LINICO Corporation, a Nevada corporation (“LiNiCo”) entered into a Series A Preferred Stock Purchase Agreement (the “Stock Purchase Agreement”).

Pursuant to the Stock Purchase Agreement, and subject to the satisfaction or waiver of specified conditions, the Company will make an initial purchase 6,250 shares of LINICO Series A Convertible Preferred Stock (“Series A Preferred”) in exchange for 3,000,000 shares of the Company's restricted common stock (“Stock Consideration”) and $ 4.5 million in cash payments (“Cash Consideration” and together with the Stock Consideration, the “Consideration”).

The Cash Consideration will be paid in a series of payments between February 26, 2021 and September 30, 2021.

AQMS will purchase 1,500 shares of Series A Preferred in exchange for 375,000 shares of AQMS.

The Company can convert the Series A Preferred shares to LiNiCo common shares at a conversion price of $ 1.25 per share.

The Stock Purchase Agreement provides that LiNiCo will use the proceeds to fund (i) technology-based lithium-ion battery recycling and cathode production equipment, (ii) an industrial facility lease-purchase, (iii) startup costs and general working capital;

(iv) a $ 1.0 million investment in Green Li-ion Pte.

and (v) the repurchase of common stock with a value of $ 500,000 .

After the initial purchase of Series A Preferred, the Company and AQMS will own 45.45 % and 10.91 %, respectively, of LiNiCo on a fully diluted basis.

Pursuant to the Stock Purchase Agreement, the Company and AQMS entered into warrant agreements wherein the Company has the right to purchase 2,500 shares of Series A Preferred for a total exercise amount of $ 2.5 million and AQMS has the right to purchase 500 shares of Series A Preferred for a total exercise amount of $ 500,000 .

The consideration for the exercise of the warrants is subject to the following:

• The value of the Consideration between $ 6.3 million and $ 8.8 million will be applied to the Company’s exercise amount (such value is to be determined by combining the Cash Consideration with the net proceeds of the Stock Consideration (which cannot be sold until after August 15, 2021)).

• The value of the AQMS shares in excess of $ 1.5 million will be applied to AQMS’s exercise amount.

The Series A Preferred received by the Company pursuant to the exercise of the warrant may be converted into common stock at conversion price of (i) $ 1.25 , if exercised on or before February 15, 2022 or (ii) $ 2.00 , if exercised after February 15, 2022.

Assuming the exercise of the warrants, the Company and AQMS will own 52.27 % and 11.94 %, respectively, of LiNiCo on a fully diluted basis.

In the event the cash proceeds from the Consideration is less than $ 6.3 million, the Company is obligated to provide LiNiCo with additional shares or cash to make up the shortfall.

However, if cash proceeds from the Consideration exceed $ 10.8 million, the excess must be returned to the Company (the $ 4.5 million differential is automatically applied to exercise of the warrant ($ 2,500,000 ) and the additional deposit pursuant to the Lease Agreement ($ 2.0 million)).

Similarly, if the cash proceeds from the sale of 75 % of the AQMS shares is less than $ 1.5 million, AQMS is obligated to provide LINICO with additional cash to make up the shortfall.

Total Assets:

$ 43,001,837 $ 83,952,795 $ — $ 126,954,632

Investments $ 8,804,587 $ 17,046,292 $ — $ 25,850,879

Goodwill $ 12,788,671 $ — $ — $ 12,788,671

At December 31, 2020 Renewable Energy Products:

Strategic and Other Investments Inter-segment Elimination Total

Revenue from external customers $ — $ 201,700 $ — $ 201,700

Inter-segment revenue — — — —

Total segment revenue — 201,700 — 201,700

Costs of Goods Sold:

Costs of Goods Sold — 51,890 — 51,890

Inter-segment eliminations — — —

Total costs of goods sold — 51,890 — 51,890

Gross Profit — 149,810 — 149,810

Operating expenses

Depreciation and amortization — 1,222,438 — 1,222,438

Other operating expenses — 4,401,633 — 4,401,633

Total costs and expenses — 5,624,071 — 5,624,071

Loss from Operations — - 5,474,261 — ( 5,474,261 )

Other income (expense)

Gain (loss) on investments — 3,152,702 — 3,152,702

Gain on sale of membership interest in Comstock Mining LLC — 18,275,846 — 18,275,846

Changes in estimated fair value of contingent forward asset — 765,880 — 765,880

Interest expense — ( 421,887 ) — ( 421,887 )

Interest income — 473,681 — 473,681

Change in fair value of derivative instruments — 427,838 — 427,838

Equity loss in affiliates — ( 2,131 ) — ( 2,131 )

Impairment of goodwill and intangible assets — — — —

Other income (expenses) — ( 2,265,698 ) — ( 2,265,698 )

Total other income (expense), net — 20,406,231 — 20,406,231

Net income (loss) — 14,931,970 — 14,931,970

Deferred income tax benefit — 0 — —

Net income (loss) attributable to Comstock Mining Inc $ — $ 14,931,970 $ — $ 14,931,970

Capital Expenditures:

$ — $ 130,750 $ — $ 130,750

Total Assets:

$ — $ 43,123,562 $ — $ 43,123,562

Investments $ — $ 3,272,597 $ — $ 3,272,597

Goodwill $ — $ — $ — $ —

Prior to December 30, 2021, RPS other services revenue of $ 905,942 were recognized for LINICO prior to our acquisition.

Of this amount, $ 371,900 was considered intersegment revenue and was eliminated in consolidation.

RPS's revenue is included in the Renewable Energy Products segment.

NOTE 21 RELATED PARTY TRANSACTIONS

In addition to the related party disclosures included in Note 2, Acquisitions and Investments , the following related party transactions occurred during the years ended December 31, 2021 and 2020.

AMENDMENT TO ASSET PURCHASE AGREEMENT

On September 7, 2021, the Company entered and closed under an Asset Purchase Agreement with Flux Photon Corporation (“FPC”), in order to acquire certain intellectual property and related photovoltaic and photocatalysis laboratory equipment (the “FPC Assets”).

The Company assigned the FPC Assets to its wholly-owned Comstock IP Holdings subsidiary immediately after closing.

Kevin Kreisler, the Company’s president and chief financial officer, and David Winsness, the Company’s chief technology officer, are indirect beneficiaries of all payments made to FPC under the Asset Purchase Agreement.

The Company additionally agreed to appoint Mr.

Kreisler to the Company’s board of directors in connection with the Company’s acquisition of Comstock Innovations Corporation (F/K/A Plain Sight Innovations Corporation) (“Comstock Innovations”) on September 7, 2021 (see Note 2, Acquisitions and Investments ).

ACQUISITION OF MAJORITY EQUITY INTEREST IN LINICO CORPORATION

During 2021, we executed and closed under a series of agreements under which we acquired 90 % of the issued and outstanding equity of LINICO Corporation (“LINICO”), in exchange for aggregate consideration of $ 4,500,000 in cash and 6,500,000 shares of Company common stock.

On February 15, 2021, Comstock, Aqua Metals Inc.

(“AQMS”), and LINICO entered into a Series A Preferred Stock Purchase Agreement (the “Stock Purchase Agreement”), pursuant to which (i) the Company purchased 6,250 shares of LINICO Series A Convertible Preferred Stock (“Series A Preferred”), corresponding to 45.45 % of LINICO’s issued and outstanding capital stock, in exchange for 3,000,000 shares of Company restricted common stock (“Stock Consideration”) and $ 4.5 million in cash payments (“Cash Consideration” and, together with the Stock Consideration, the “Consideration”), subject to the satisfaction or waiver of specified conditions;

and (ii), AQMS purchased 4,500,000 LINICO Series A Preferred shares, corresponding to 10.91 % of LINICO’s issued and outstanding capital stock, in exchange for 375,000 shares of AQMS.

The Company, AQMS, and LINICO additionally entered into warrant agreements in connection with the closing of the Stock Purchase Agreement, pursuant to which the Company has the right to purchase an additional 2,500 shares of LINICO Series A Preferred in exchange for $ 500,000 , and AQMS has the right to purchase an additional 500 shares of LINICO Series A Preferred in exchange for $ 500,000 .

If the cash proceeds from the Consideration are less than $ 6,250,000 , the Company agreed to provide LINICO with additional shares or cash to make up the shortfall.

However, if cash proceeds from the Consideration exceed $ 10,750,000 , the excess must be returned to the Company, after the $ 4,500,000 differential above $ 6,250,000 is applied to exercise of the

warrant ($ 2,500,000 ) and the additional deposit due under the AQMS Lease Agreement ($ 2,000,000 ) (see Note 2, Acquisitions and Investments , Note 6, Property, Plant and Equipment , Note 15, Fair Value Measurements ).

Similarly, if the cash proceeds from the sale of 75 % of the AQMS shares is less than $ 1,500,000 , AQMS is obligated to provide LINICO with additional cash to make up the shortfall.

LINICO is obligated to hold the remaining 25 % of AQMS shares for at least six months after the date of the Stock Purchase Agreement.

After such date, the gross proceeds in excess of $ 2.0 million from the sale of all the AQMS shares must be returned to the AQMS (the $ 500,000 differential is automatically applied to the exercise of the AQMS warrants).

Additional Lease Deposit

The Lease Agreement requires LiNiCo to make an additional deposit (to be credited towards the purchase price of the facility) by November 1, 2022 in an amount equal to $ 2.0 million.

The Stock Purchase Agreement grants the Company the option to fund such deposit with additional Company shares (in no event will the Company issues shares to LiNiCo pursuant to the Stock Purchase Agreement that exceed 19.9 % of the total issued and outstanding common shares of the Company as of February 15, 2021).

In the event the option is exercised, the Company and AQMS would own an estimated 64.02 % and 10.66 % of LiNiCo, respectively, on a fully diluted basis.

LiNiCo Lease Agreement

On February 15, 2021, LiNiCo and Aqua Metal Reno Inc.

(the “Landlord”) entered into an Industrial Lease for the land, buildings and related improvements located at 2500 Peru Drive, McCarran, Nevada 89343 (the “Lease Agreement”).

The Lease Agreement is for a two-year term and commences on April 1, 2021.

The rental costs are $ 68,000 per month for the first 12 months and escalate to $ 81,600 for months 13 to 18 and $ 100,640 for months 19 to 24.

LiNiCo will use a portion of the Consideration to pay the initial $ 1.3 million nonrefundable deposit (the “Deposit”) that is due on or before October 15, 2021.

The Deposit is to be applied to the purchase price if the Purchase Option (as defined below) is exercised.

Pursuant to the Lease Agreement, LiNiCo has the right to purchase the premises for (i) $ 14.3 million, if purchased on or before October 1, 2022 or (ii) $ 15.3 million, if the purchase is made after October 1, 2022 (“Purchase Option”).

The Lease Agreement also grants the Company the right to consummate the Purchase Option if LiNiCo and the Landlord agree LiNiCo will not exercise the Purchase Option.

On February 22, 2021, the Company issued 3,000,000 shares of restricted common stock to LINICO in exchange for 6,250 shares of Series A Preferred.

Equity Issuance Agreements

On March 2, 2021, the Company entered into equity purchase agreements (the “Equity Purchase Agreements”) with certain investors to issue and sell in a registered direct offering (the “Offering”) 4.0 million shares of common stock at a price of $ 4.00 per share.

The Equity Purchase Agreements contain customary representations, warranties and agreements of the Company, and customary conditions to closing, indemnification rights and obligations of the parties.

The Offering of the shares closed on March 4, 2021.

The Company paid Noble Capital Markets, Inc., the placement agent for the Offering, an aggregate cash fee equal to 6 % of the aggregate gross proceeds raised in the offering, and agreed to pay up to $ 30,000 for other fees and expenses, resulting in expected net offering proceeds of $ 15.0 million.

On March 4 2021, the Company repaid $ 3.2 million, representing all amounts outstanding under the Promissory Notes, including principal, earned original issue discount and accrued interest expense.

On March 4, 2021, the Company made an $ 812,500 payment to Northern Comstock LLC representing, pursuant to the Northern Comstock operating agreement, a one-time acceleration of required capital contributions when the Company receives net cash proceeds from sources other than operations that exceed $ 6,250,000 (Note 21).

Changes and Disagreements with Accountants on Accounting and Financial Disclosure

On September 23, 2020, the Audit Committee of the Board of Directors of the Company, upon completion of a formal proposal process with independent registered public accounting firms, dismissed Deloitte & Touche LLP (“D&T”) as its independent registered public accounting firm and selected Assure CPA, LLC (a successor-in-interest of DeCoria, Maichel & Teague, P.S.

formed on November 3, 2020) (“Assure”), as the independent registered public accounting firm to audit the financial statements of Comstock and its consolidated subsidiaries for the fiscal year ending December 31, 2020.

The reports of D&T on the consolidated financial statements of Comstock as of and for the fiscal years ended December 31, 2017, 2018 and 2019 did not contain any adverse opinion or disclaimer of opinion.

These reports were not qualified or modified as to uncertainty, audit scope or accounting principles.

During the fiscal years ended December 31, 2017, 2018 and 2019 there were no disagreements between D&T and Comstock on any matter of accounting principles or practices, financial statement disclosure, or auditing scope or procedure, which disagreements, if not resolved to the satisfaction of D&T, would have caused D&T to make reference to the subject matter of the disagreements in connection with their reports.

Furthermore, during the fiscal years ended December 31, 2017, 2018 and 2019, there were no reportable events (as described in Item 304(a)(1)(v) of Regulation S-K).

The fiscal years ended December 31, 2018 and 2019 are Comstock’s two most recent completed fiscal years prior to the end of D&T’s engagement.

During the fiscal years ended December 31, 2017, 2018 and 2019 neither Comstock nor anyone on its behalf consulted Assure regarding either (i) the application of accounting principles to a specified transaction (either completed or proposed), or the type of audit opinion that might be rendered on Comstock's consolidated financial statements, or (ii) any matter that was either the subject of a disagreement (as described in Item 304(a)(1)(iv) of Regulation S-K) or a reportable event (as described in Item 304(a)(1)(v) of Regulation S-K).

Comstock provided D&T with a disclosure and requested D&T to furnish Comstock with a letter addressed to the Securities and Exchange Commission stating whether it agrees with such statements.

A copy of D&T’s letter is filed as Exhibit 16.1 to our Form 8-K filed on September 28, 2020.

After such date, the gross proceeds in excess of $ 2,000,000 from the sale of all AQMS shares must be returned to the AQMS (the February 15, 2021 differential is automatically applied to the exercise of the AQMS warrants).

On December 30, 2021, the Company entered into an agreement to acquire $ 3,129,081 LINICO common shares from its former chief executive officer and director equating to 90 % ownership.

The former chief executive officer resigned from LINICO as a member of its board of directors and in all other capacities, effective at such date.

In connection with the acquisition of such LINICO shares, the Company issued 3,500,000 common shares of the Company (“Comstock Shares”) to the former chief executive officer.

If and to the extent that the sale of the LODE Shares results in net proceeds greater than $ 7,258,162 , then the former chief executive officer is required to pay all of such excess proceeds to the Company.

The Company retained the right to purchase the Comstock Shares from the former chief executive officer for the purchase price of $ 7,258,162 (less the amount of cash proceeds received by the former chief executive officer from any previous sale of the Comstock Shares by the former chief executive officer), at any time during or prior to his sale of the Comstock Shares.

At December 31, 2021, the remaining 10 % of LINICO’s issued and outstanding equity was owned by Aqua Metals Inc.

One of the members of the Company’s board of directors, is the chief financial officer of AQMS.

LEASE AND PURCHASE AGREEMENT FOR BATTERY RECYCLING FACILITY

On February 15, 2021, LINICO and Aqua Metals Reno Inc.

(the “Landlord”), a subsidiary of AQMS, entered into an industrial lease (the “AQMS Lease Agreement”), for the 136,750 square foot facility, land, and related improvements located at 2500 Peru Drive, McCarran, Nevada 89343 (the “Battery Recycling Facility”).

The AQMS Lease Agreement commences April 1, 2021 and expires on March 31, 2023.

During the lease term, LINICO has the option to purchase the land and facilities at a purchase price of $ 14,250,000 if the option is exercised and the sale is completed by October 1, 2022, and $ 15,250,000 if the option is exercised and the sale is completed after October 1, 2022 and prior to March 31, 2023.

The purchase option is subject to LINICO’s payment of a nonrefundable deposit of $ 1,250,000 by October 15, 2021, and a second nonrefundable deposit of $ 2,000,000 by November 22, 2022, both of which will be applied towards the purchase price.

The lease agreement is a triple-net lease pursuant to which LINICO will be responsible for all fixed costs, including maintenance, utilities, insurance, and property taxes.

The lease agreement provides for LINICO’s monthly lease payments starting at $ 68,000 per month and increasing to $ 100,640 in the last six months of the lease.

The lease agreement allows AQMS to retain the use of a portion of the facility for ongoing research and development activities, including operation of the lab and the use of office space.

TRANSACTIONS INVOLVING SIERRA SPRINGS OPPORTUNITY FUND

The Company provided SSOF with a total of $ 4,935,000 in advances (“SSOF Advances”), including $ 3,285,000 and $ 1,650,000 provided during the years ended December 31, 2021 and 2020, respectively.

SSOF was required to use the corresponding proceeds to pay deposits and other payments on land and other facilities related to investments in qualified businesses in the opportunity zone.

The SSOF Advances are non-interest-bearing and are expected to be repaid on or before the closing of the Company’s sale of the Silver Springs Properties to SSE (see Note 2, Acquisitions and Investments ).

SSOF has assigned all assignable rights, title and interest in SSOF’s property purchases until such time as the SSOF Advances are repaid.

SSOF is currently raising additional equity financing, including sufficient proceeds to fully pay the $ 4,935,000 SSOF Advances and the $ 9,740,000 required to close under its pending purchase agreement for Comstock’s Silver Springs Properties.

The Company expects that transaction to be completed during 2022, thereby providing the Company with $ 14,635,000 in estimated cash proceeds.

The $ 450,000 investment and 9,000,000 voting shares of our CEO and two of our directors represent 16.4 % of total as converted SSOF common shares.

The Company's chief executive officer has not received compensation of any kind from either SSOF or SSE.

NOTE 22 SUBSEQUENT EVENTS

On January 3, 2022, the Company made an additional SSOF Advance of $ 1,300,000 , for use by SSE in paying deposits for contracted property purchases.

SSE assigned all assignable rights, title and interest in SSE’s property purchases to the Company until such time as the SSOF Advances are repaid.

On January 20, 2022, the Compensation Committee of the Company’s Board of Directors authorized a special cash award of $ 150,000 to William McCarthy, the Company’s Chief Operating Officer, for superlative efforts.

LP Biosciences LLC

On February 28, 2022, the Company and the other parties to the LP Biosciences transactions mutually agreed to terminate the Transaction Documents.

Upon termination of the transactions, each of the parties were relieved of their respective rights, liabilities, expenses, and obligations under the transactions except for payment obligations under the termination agreement and tax obligations in respect of their ownership of LPB through the date of termination.

In connection with the termination, 3,500,000 restricted shares of the Company’s common stock were transferred back to the Company for cancellation upon receipt.

The Company incurred additional expenses of approximately $ 250,000 in connection with the termination of the transaction.

On August 20, 2021, the former employees filed a wrongful termination lawsuit against the Company, its Board of Directors, its Audit and Finance Committee, its Chief Executive Officer and certain of its managers for the termination of their employment.

On March 4, 2022, the Company and the former employees agreed to a settlement, which will result in the litigation being dismissed.

At December 31, 2021, the Company has accrued the agreed upon severance and related costs.

Tonogold Option Agreement, Reconveyance of Lucerne mine and related assets, and Tonogold Note Receivable

On March 26, 2022, the Company entered into an Option Agreement with Tonogold (the “Lucerne Option”).

Subject to certain conditions under the Lucerne Option (including the obligation to complete certain capital raising thresholds and technical reports), Tonogold will re-convey 100 % of the previously sold membership interests of Comstock Mining LLC, the entity that owns the Lucerne mine, to the Company, in exchange for the Company forgiving Tonogold’s payment obligations under secured note in the principal amount of $ 6,650,000 owed by Tonogold to the Company.

Under the Lucerne Option, Tonogold will pay the Company a non-refundable $ 750,000 option fee for the right to purchase the membership interests of Comstock Mining LLC for $ 7,750,000 on or prior to December 31, 2022.

Tonogold will also be entitled to pay an additional $ 500,000 non-refundable extension fee to extend the last day of the option exercise period from December 31, 2022, to July 1, 2023.

In order to maintain its right to exercise the option, Tonogold bears the responsibility for certain reclamation liabilities, assumes responsibility for the guarantee of the Company’s future payments of capital contributions required under the operating agreement of Northern Comstock and provide payment for all obligations that Tonogold would have otherwise been required to assume under the original purchase agreement and related documents, including the NSR royalty on the Lucerne properties, mineral exploration and mining lease payments, payments related to the Lease Option Agreement, and for certain other properties acquired by Tonogold.

ITEM 9 CHANGES AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND

FINANCIAL DISCLOSURE

Not applicable.

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-K

Item 8. Financial Statements and Supplementary Data