What changed in this filing

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Item 7. Management’s Discussion and Analysis

2025-03-12 compared with 2024-03-22 · 96 added, 90 removed, 193 unchanged (49% of the section changed)

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Although our mineral properties may be developed in the future by us, through a joint venture or by a third party, we have never developed a mineral property.

In addition to focusing on our current mineral exploration properties, we also from time to time evaluate potential strategic transactions for the acquisition of new precious and base metal properties and assets with exploration potential.

In addition to focusing on our current mineral exploration properties, from time to time we also evaluate potential strategic transactions for the acquisition of new precious and base metal properties and assets with exploration potential.

Our current geographic focus for the evaluation of potential mineral properties is in North and South America;

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At December 31, 2024, we consider our Golden Crest project in South Dakota, our carried interest in our Florida Canyon project in Peru, and our interest in the Lik project in Alaska to be our core mineral property assets.

We also have an interest in our Cat Creek project in Colorado, an early-stage exploration project.

We are conducting independent exploration activities in Peru and through joint ventures operated by our partners in Peru and the United States.

We conduct potential acquisition evaluations in other countries in both North and South America.

As of December 31, 2023, we have balances of cash and short-term investments that we anticipate using, in part, to fund planned 2024 exploration, to further the exploration of our Lik and Golden Crest projects, conduct reconnaissance exploration and to potentially acquire additional mineral properties.

As of December 31, 2024, we have balances of cash and short-term investments that we anticipate using, in part, to fund planned 2025 exploration, to further the exploration of our Lik, Golden Crest and Cat Creek projects, conduct reconnaissance exploration and to potentially acquire additional mineral properties.

The fluctuations in commodity prices of base and precious metals have contributed to a challenging environment for mineral exploration and development, which has created opportunities as well as challenges for the potential acquisition of advanced mineral exploration projects or other related assets at potentially attractive terms.

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and (viii) joint venture payments, including delay rental payments.

During 2024 we issued 1,802,060 shares pursuant to our ATM program, described below, for net proceeds of $1,218,000, after commissions and expenses.

During 2023 we issued a total of 13,298,485 shares of our common stock in private transactions for net proceeds of $7,352,000.

During 2022 we issued a total of 2,650,724 shares of our common stock pursuant to our ATM Program for net proceeds of $2,023,000.

We did not record any mineral property income from the sale of mineral properties during 2024 or 2023.

We have reduced our exposure to the costs of our exploration activities in the past through the use of joint ventures.

Although we anticipate the use of joint venture funding for some of our exploration activities will continue for the foreseeable future, we can provide no assurance that these or other sources of capital will be available in sufficient amounts to meet our needs, if at all.

Although we anticipate the use of funding through our joint venture parties for some of our exploration activities will continue for the foreseeable future, we can provide no assurance that these or other sources of capital will be available in sufficient amounts to meet our needs, if at all.

Results of Operations

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We had a net loss of $5,368,000 or $0.07 per basic and diluted share for the year ended December 31, 2024 compared to a net loss of $3,754,000 or $0.05 per basic and diluted share for the year ended December 31, 2023.

As explained in more detail below, the primary reasons for the decrease in net loss during 2023 compared to 2022 was (i) an increase in interest income to $191,000 during 2023 compared to interest income of $131,000 during 2022;

(ii) a recorded gain on derivative instruments of $31,000 during 2023 compared to a loss on derivative instruments of $4,000 during 2022;

(iii) a loss on sale of marketable equity securities of $201,000 during 2022, compared with no sales of marketable equity securities during 2023;

(iv) an unrealized gain on short-term investments of $56,000 during 2023 compared to an unrealized loss on short-term investments of $108,000 during 2022;

and (v) an unrealized gain of $83,000 on marketable equity securities during 2023 compared to an unrealized loss on marketable equity securities of $94,000 during 2022.

Partially offsetting these factors that contributed to the decrease in our net loss in 2023 were the following (i) an increase in our exploration expense to $2,378,000 during 2023 compared to exploration expense of $2,283,000 during 2022 and (ii) an increase in general and administrative expense to $1,712,000 during 2023 compared to general and administrative expense of $1,360,000 during 2022.

As explained in more detail below, the primary reasons for the increase in net loss during 2024 compared to 2023 were (i) an increase in our exploration expense to $4,148,000 during 2024 compared to exploration expense of $2,378,000 during 2023;

(ii) an increase in general and administrative expense to $1,879,000 during 2024 compared to general and administrative expense of $1,712,000 during 2023;

(iii) a loss on derivative instruments of $29,000 during 2024 compared to a gain on derivative instruments of $31,000 during 2023;

and (iv) an unrealized gain on short-term investments of $56,000 during 2023 with no similar item in 2024.

Partially offsetting these factors that contributed to an increased loss during 2024 compared to 2023 were (i) an increase in interest income to $372,000 during 2024 compared to interest income of $191,000 during 2023;

(ii) a gain on sale of marketable equity securities of $54,000 during 2024, compared with no sales of marketable equity securities during 2023;

and (iii) an unrealized gain of $289,000 on marketable equity securities during 2024 compared to an unrealized gain on marketable equity securities of $83,000 during 2023.

Each of these items is discussed in greater detail below.

Our primary exploration activities during 2024 and 2023 were related to our Golden Crest project in South Dakota and our Lik project in Alaska.

We recorded $1,798,000 of exploration costs at Golden Crest during 2023 compared to $1,505,000 during 2022.

The Golden Crest expenditures during 2023 and 2022 consisted primarily of geologic evaluation of claims for staking, mapping and soil and rock sampling with related assay costs.

In addition to these exploration costs, we also capitalized $340,000 of mineral acquisition costs at Golden Crest for our initial acquisition costs related to leasing, staking and filings on claims acquired during 2022 compared to 2023 when we had no staking, leasing or other initial acquisition costs and, accordingly we did not capitalize any initial acquisition costs during 2023.

All future exploration and filing costs related to these claims will be expensed as incurred.

We recorded exploration costs of $3,884,000 at Golden Crest during 2024 compared to $1,798,000 during 2023.

The Golden Crest expenditures during 2024 were primarily related to the drilling program where we completed 11 drill holes during 2024, with direct drilling costs of approximately $2,042,000.

During 2023 our Golden Crest expenditures consisted primarily of geologic evaluation of claims for staking, mapping and soil and rock sampling with related assay costs.

In addition to these exploration costs, we capitalized $43,000 of mineral acquisition costs at Golden Crest for initial acquisition costs related to leasing, staking and filings on new claims acquired during 2024 compared to 2023 when we had no staking, leasing or other initial acquisition costs and, accordingly we did not capitalize any initial acquisition costs during 2023.

All future exploration and filing costs related to our Golden Crest claims will be expensed as incurred.

Solitario’s share of exploration expenses at our Lik project in Alaska was $142,000 during 2024 compared to exploration costs at our Lik project of $404,000 during 2023.

Teck completed a single drill hole during 2022 compared to a three-hole drilling program during 2022 which accounted for the decrease in expenses during 2023 compared to 2022.

Teck completed a single drill hole during 2023, and there was no drilling at Lik during 2024 which accounted for the decrease in expenses during 2024 compared to 2023.

In addition, Teck performed on-going geologic evaluation of the Lik project during both 2024 and 2023, which included on-site geophysics, mapping and analysis of prior drilling and permitting, as well as on-going site environmental monitoring, evaluation and clean-up as part of a 50/50 exploration program managed by Teck.

The geophysical surveys were successful in defining a low-amplitude gravity anomaly that requires further follow-up work.

We are evaluating, along with Teck, the completed 2023 and 2022 drilling programs for planned exploration in 2024.

We are planning additional geotechnical work for 2025 as well as further environmental monitoring and clean-up at the site.

We spent approximately $35,000 during 2024 at our Cat Creek project, a new early-stage exploration project, with no similar amount during 2023.

Given that the exploration program at our Florida Canyon project in Peru is fully funded by our joint venture partner, Nexa, we incurred relatively small exploration expenses at Florida Canyon of $14,000 during 2024 compared to $41,000 in 2023.

The remaining exploration expenditures during 2024 and 2023 were reconnaissance work, including the evaluation of potential mineral properties for acquisition.

Our planned 2024 total exploration and development budget, excluding any new projects, in which we may acquire an interest, is approximately $3,927,000, which reflects planned work at the Golden Crest project, including $2,000,000 for drilling the Golden Crest project, depending on permitting.

Our planned 2025 total exploration and development budget, excluding any new projects, in which we may acquire an interest, is approximately $3,910,000, which reflects planned work at the Golden Crest project, including $1,911,000 for drilling at the Golden Crest project, depending on permitting.

Our planned exploration activities in 2025 may be modified, as necessary for any drilling programs we may undertake at Golden Crest or projects we may acquire, changes related to any number of factors including, potential acquisition of new properties, joint venture funding, commodity prices and changes in the deployment of our capital.

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Excluding these costs, general and administrative costs were $1,213,000 during 2024 compared to $1,465,000 during 2023.

The major components of our general and administrative costs were (i) salary and benefits expense which increased to $795,000 during 2023 compared to $411,000 during 2022, as a result of increased salaries and an increase in bonuses to $382,000 in 2023 compared to a bonus of $57,000 during 2022;

(ii) legal and accounting costs which decreased to $253,000 during 2023 compared to $287,000 during 2022 primarily due to increased accounting costs in 2022 to comply with initial SK-1300 disclosure requirements during 2022;

(iii) travel and investor relation costs which increased to $287,000 during 2023 compared to $205,000 during 2022 as a result of additional travel and investor conferences attended during 2023 compared to 2022;

The major components of our general and administrative costs were (i) salary and benefits expense which decreased to $399,000 during 2024 compared to $795,000 during 2023, as a result of fewer personnel and a decrease in bonuses to $27,000 in 2024 compared to a bonus of $382,000 during 2023;

(ii) legal and accounting costs which decreased to $220,000 during 2024 compared to $253,000 during 2023 primarily due fees related to private placement financings during 2023 compared to 2024 with no corresponding transactions.;

(iii) travel and investor relation costs which increased to $450,000 during 2024 compared to $287,000 during 2023 as a result of having an investor relations consulting contract during 2024 as well as additional travel and investor conferences attended during 2024 compared to 2023;

and (iv) other costs related to office, insurance and miscellaneous costs which increased to $143,000 during 2024 compared to $130,000 during 2023 as a result of additional activity and general cost increases.

We anticipate general and administrative costs for 2024 to be approximately $1,331,000 which will be somewhat lower than the costs incurred during 2023;

however, this amount may vary significantly during 2024 depending on the outcome of our exploration activity at Golden Crest and Lik projects and any strategic transactions we may attempt to execute upon.

We anticipate general and administrative costs for 2025 to be approximately $1,010,000 which would be lower than the costs incurred during 2024;

however, this amount may vary significantly during 2025 depending on the outcome of our exploration activity at Golden Crest, Cat Creek and Lik projects and any strategic transactions we may attempt to execute upon.

We account for our employee stock options under the provisions of Accounting Standards Codification No.

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We recognize stock option compensation expense on the date of grant for 25% of the grant date fair value, and subsequently, based upon a straight-line amortization of the grant date fair value of each of our outstanding options.

During the year ended December 31, 2023, we recorded $247,000 of non-cash stock-based compensation expense for the amortization of our outstanding options grant date fair value with a credit to additional paid-in-capital compared to $338,000 of non-cash stock option compensation expense during 2022.

The amount was higher during 2022 primarily due to the grant of 2,360,000 options with a total grant date fair value of $876,000, of which Solitario recognized 25% on the grant date or $218,000 compared 50,000options granted during 2023, with a grant date fair value of $16,000 of which Solitario recognized 25% or $4,000 during 2023.

During the year ended December 31, 2024, we recorded $666,000 of non-cash stock-based compensation for the amortization of our outstanding options grant date fair value with a credit to additional paid-in-capital compared to $247,000 of non-cash stock option compensation expense during 2023.

The amount was higher during 2024 primarily due to the grant of 2,125,000 options with a total grant date fair value of $1,120,000, of which Solitario recognized 25% on the grant date of $280,000 compared to 50,000 options granted during 2023, with a grant date fair value of $16,000.

The remaining compensation expense was related to the straight-line amortization of our outstanding options in 2024 and 2023.

See Note 10, “Employee Stock Compensation Plans,” to our consolidated financial statements in Item 8, “Financial Statements and Supplementary Data to this Annual Report on Form 10-K” for an analysis of the changes in the fair value of our outstanding stock options and the components that are used to determine the fair value.

We recorded an unrealized gain on marketable equity securities of $83,000 during 2023 compared to an unrealized loss on marketable equity securities of $94,000 during 2022.

The net gain on marketable equity securities during 2023 was primarily related to a $196,000 unrealized gain related to an increase in the value of our holdings of Kinross common stock and an increase of $33,000 in the value of our holdings of Highlander Silver common stock, which was partially offset by an unrealized loss related to the decrease of $111,000 in the value of our holdings of Vendetta stock and a decrease in the value of our holdings of Vox common stock of $35,000 during 2023.

The loss during 2022 was primarily related to an unrealized loss on marketable equity securities of $172,000 due to a decrease in the value of our holdings of shares of Kinross common stock and an unrealized loss on marketable equity securities of $59,000 on our holdings of Vox common stock, partially offset by an unrealized gain on marketable equity securities of $137,000 in the value of our holdings of Vendetta common stock.

We recorded an unrealized gain on marketable equity securities of $289,000 during 2024 compared to an unrealized gain on marketable equity securities of $83,000 during 2023.

The net gain on marketable equity securities during 2024 was primarily related to a $322,000 unrealized gain related to an increase in the value of our holdings of Kinross common stock and an increase of $38,000 in the value of our holdings of Vox Royalty common stock, which was partially offset by an unrealized loss related to the decrease of $37,000 in the value of our holdings of Vendetta stock and a decrease in the value of our holdings of Highlander Silver common stock of $1,000 during 2024, prior to its sale during 2024.

The loss during 2023 was primarily related to an unrealized gain on marketable equity securities of $196,000 due to an increase in the value of our holdings of shares of Kinross common stock and an unrealized gain on marketable equity securities of $33,000 on our holdings of Highlander Silver common stock, partially offset by an unrealized loss on marketable equity securities of $111,000 in the value of our holdings of Vendetta common stock and an unrealized loss on marketable equity securities of $35,000 in the value of our holdings of Vox Royalty common stock.

Changes in the unrealized value of our holdings of marketable equity securities are related to the changes in the fair values of those holdings which are dependent on the market prices of the individual securities.

During 2022 we sold 1,250,000 shares of Vendetta common stock for proceeds of $63,000 and recorded a realized loss on the sales of $201,000.

During 2024 we sold 100,000 shares of Highlander Silver common stock for proceeds of $54,000 and recorded a realized gain on the sale of $54,000.

We had no sales of marketable equity securities during 2023.

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See “Liquidity and Capital Resources” below.

We recorded a gain on derivative instruments of $31,000 during 2023 compared to a loss on derivative instruments of $4,000 during 2022.

During 2023, we sold certain Kinross calls against our holdings of Kinross common stock for proceeds of $31,000.

The calls expired unexercised during 2023 and we recorded a gain of $31,000 during 2023 related to those calls.

During 2022, our warrants to acquire Vendetta common stock (“Vendetta Warrants”) expired unexercised, which resulted in the $4,000 loss on derivative instruments.

We recorded a loss on derivative instruments of $29,000 during 2024 compared to a gain on derivative instruments of $31,000 during 2023.

During 2024, we sold certain Kinross calls against our holdings of Kinross common stock for net proceeds of $38,000 and at December 31, 2024 we have outstanding Kinross covered calls covering our 100,000 shares that expire in May 2025 and have an exercise price of $10.00 per share, for which we have recorded a current liability of $67,000.

During 2023 we sold covered calls against our holdings of Kinross common stock for proceeds of $31,000 which expired unexercised during 2023 and we recorded a gain of $31,000 during 2023 related to those calls.

See Note 7, “Derivative Instruments” to our consolidated financial statements in Item 8, “Financial Statements and Supplementary Data” of this Annual Report on Form 10-K for additional discussion of our derivative instruments.

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We recorded $27,000 of depreciation and amortization during 2024 compared to $25,000 of depreciation and amortization during 2023.

The reduction in depreciation and amortization is primarily related to certain assets becoming fully depreciated during 2023 and 2022.

The increase in depreciation and amortization is primarily related the purchase of operating equipment during 2024 with the increased depreciation partially offset as older assets became fully depreciated during 2024 and 2023.

We amortize our equipment over a five-year period.

We anticipate our 2025 depreciation and amortization expense will be similar to our 2024 depreciation expense.

We recorded interest income of $191,000 during 2023 compared to interest income of $131,000 during 2022.

The increase during 2023 was primarily related to an increase in the outstanding balances of our investments in our money market account and United States Treasury securities during the majority of the year as a result of the net proceeds of $7,352,000 received from private placement sales of our common stock during 2023.

In addition, interest rates on short-term investments increased during 2023 compared to 2022.

During 2023, we recorded an unrealized gain of $56,000 related to the value of our mark-to-market short term investments in United States Treasury securities compared to an unrealized loss of $108,000 during 2022 as a result of changing interest rates.

We anticipate our unrealized gains and losses related to our mark-to-market short-term investments will decrease in 2024 compared to 2023 as a result of the use of money market funds rather than short-dated USTS during 2024, as well as a reduction in the balances of our short-term investments and our cash balances for ordinary overhead, operational costs, and the exploration, evaluation and or acquisition of mineral properties discussed above.

See “Liquidity and Capital Resources,” below, for further discussion of our cash and cash equivalent balances.

Our other income of $20,000 during 2022 was from the sale of certain exploration data on a non-owned mineral property upon which Solitario had previously done exploration activities, with no similar item in 2023.

We do not anticipate other income will be a significant source of cash in 2024, if at all.

We recorded interest and dividend income of $372,000 during 2024 compared to interest and dividend income of $191,000 during 2023.

The increase during 2024 was primarily related to an increase in the outstanding balances of our investments in our money market account during the majority of the year as a result of the net proceeds of $7,352,000 received from private placement sales of our common stock during 2023.

In addition, average interest rates on short-term investments were higher during 2024 compared to average interest rates during 2023.

We anticipate our interest and dividend income will be lower in 2025 as a result of reduced short-term investment balances during 2025 compared to 2024.

During 2023, we recorded an unrealized gain of $56,000 related to the value of our mark-to-market short term investments in United States Treasury securities with no similar gain or loss during 2024.

This unrealized gain was as a result of the effects of changing interest rates on our outstanding USTS short-term investments.

We anticipate we will not incur unrealized gains and losses related to our mark-to-market short-term investments in 2025 as a result of the use of money market funds rather than short-dated USTS during 2025.

See “Liquidity and Capital Resources,” below, for further discussion of our cash and cash equivalent and short-term asset balances.

We recorded no deferred tax expense or benefit in either 2024 or 2023 as we provide a valuation allowance for the tax benefit arising out of our net operating losses for all periods presented.

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As of December 31, 2024, we had $81,000 in cash.

We intend to utilize a portion of this cash and a portion of our short-term investments, discussed below, to fund our ordinary overhead, operational costs, exploration activities and for the potential acquisition of additional mineral properties and other assets over the next several years.

We intend to utilize a portion of this cash and a portion of our short-term investments, discussed below, to fund our ordinary overhead, operational costs, exploration activities and for the evaluation of potential acquisitions of mineral properties and other assets over the next several years.

Short-term Investments

As of December 31, 2023, we have money market investments and USTS with maturities of 1 day to two months.

At December 31, 2023 we had $7,738,000 in our money market account held in a brokerage account and USTS recorded at their fair value of $698,000.

Solitario also held CDs during 2022 which matured during 2022.

Solitario has no outstanding CDs at December 31, 2023.

The USTS are recorded at their fair value based upon quoted market prices.

Our short-term investments in the money market account and USTS are highly liquid and may be sold in their entirety at any time at their quoted market price and are classified as a current asset.

We anticipate we will roll over that portion of our short-term investments not used for operating costs or mineral property acquisitions as they mature during 2024.

At December 31, 2024 we had $4,523,000 in our money market account held in a brokerage account.

Solitario also held USTS during 2023 which matured during 2024.

Solitario has no investment in USTS at December 31, 2024.

Our short-term investments in the money market account are highly liquid and may be sold in their entirety at any time at their quoted market price and are classified as a current asset.

We anticipate we will roll over that portion of our short-term investments not used for operating costs or mineral property acquisition efforts as they mature during 2025.

Marketable Equity Securities

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We owned 100,000 shares of Kinross common stock as of December 31, 2024, which are recorded at their fair value of $927,000.

As of December 31, 2023, we own 7,750,000 shares of Vendetta common stock recorded at their fair market value of $118,000, we own 134,055 shares of Vox common stock recorded at their fair market value of $276,000, and we own 100,000 shares of Highlander Silver Corp common stock recorded at their fair market value of $33,000.

As of December 31, 2024, we own 7,750,000 shares of Vendetta common stock recorded at their fair market value of $81,000, and we own 134,055 shares of Vox Royalty common stock recorded at their fair market value of $314,000.

Changes in the fair value of marketable equity securities are recorded as gains and losses in the statements of operations.

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Our existing resources are adequate to fund these expenditures.

These expenditures include planned exploration for Golden Crest, including potential drilling, pending the receipt of required permits, as well as planned exploration at our Lik project where we are in discussions with our joint venture partner, Teck, regarding planned 2024 expenditures.

These expenditures include planned exploration for Golden Crest, including potential drilling, pending the receipt of required permits, as well as planned limited exploration at our Lik project for 2025 of approximately $400,000 at the project of which Solitario will be responsible for 50% of expenditures.

We do not expect any significant exploration expenditures at our Florida Canyon project where Nexa is responsible for all 2025 planned expenditures.

We also plan on limited exploration expenditure at our Cat Creek project.

We expect we will need additional capital if we decide to develop or operate any of our current exploration projects or any projects or assets we may acquire.

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See Note 10, “Employee Stock Compensation Plans” to our consolidated financial statements in Item 8, “Financial Statements and Supplementary Data” of this Annual Report on Form 10-K for a discussion of the activity in our 2013 Plan and our 2023 Plan during 2024 and 2023.

We do not anticipate that a significant portion of our outstanding stock options will be exercised during 2024.

We anticipate that a portion of our outstanding stock options currently in the money at December 31, 2024 will be exercised during 2025.

Equity offering private placements

We had no private placement of shares during 2024.

On July 31, 2023, we entered into a Stock Purchase Agreement (the “SPA”) with Newmont Overseas Exploration Ltd.

(“Newmont”), for the purchase and sale of 4,166,667 shares of Solitario common stock (the “Newmont Shares”), at a price of $0.60 per share for net proceeds of $2,422,000 after certain legal and regulatory offering costs of $78,000.

In connection with the sale of the Newmont Shares, we entered into an Investor Rights Agreement with Newmont, which granted Newmont certain additional rights, including a preemptive right, certain anti-dilution protections and certain other rights and notice provisions related to our Gold Crest mineral property assets.

On October 13, 2023, we completed a private placement of 8,631,818 shares of our common stock (the “Shares”) at a price of $0.55 per share for net proceeds of $4,727,000 after certain legal and regulatory offering costs of $21,000.

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We did not engage an underwriter or placement agent for the private placement, and therefore there were no underwriter discounts or commissions or placement agent fees.

On November 16, 2023, we entered into a consulting and capital markets advisory contract (the “Consulting Contract”) with an independent advisory firm, in exchange for the issuance of 500,000 shares which were issued on December 6, 2023 at a price of $0.51 per share.

On November 16, 2023, we entered into a consulting and capital markets advisory contract (the “Consulting Contract”) with an independent advisory firm, in consideration for the issuance of 500,000 shares which were issued on December 6, 2023 at a price of $0.51 per share.

The sale of the shares was made through a subscription agreement between us and the advisory firm.

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We recorded a pre-paid expense of $255,000 for the issuance of the shares.

The pre-paid expense is being amortized over the one-year term of the Consulting Contract and we recorded $32,000 in general and administrative expense during 2023 related to the Consulting Contract.

The pre-paid expense is being amortized over the one-year term of the Consulting Contract and we recorded $223,000 and $32,000, respectively, in general and administrative expense during 2024 and 2023 related to the Consulting Contract.

At the Market Offering

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The common stock is distributed at the market prices prevailing at the time of sale.

As a result, prices of the common stock sold under the ATM Program may vary as between purchasers and during the period of distribution.

As a result, prices of the common stock sold under the ATM Program may vary between purchasers and during the period of distribution.

The ATM Agreement provides that Wainwright is entitled to compensation for its services at a commission rate of 3.0% of the gross sales price per share of common stock sold.

During 2024, we sold 1,802,060 shares of our common stock under the ATM Program at an average price of $0.70 per share for net proceeds of $1,218,000 after commissions and sale expenses.

We did not sell any shares under the ATM Program during 2023.

During 2022, we sold 2,650,724 shares of our common stock under the ATM Program at a price of $0.79 per share for net proceeds of $2,023,000 after commissions and sale expenses.

Off-balance sheet arrangements

As of December 31, 2024 and 2023, we have no off-balance sheet arrangements.

Net cash used in operations during the year ended December 31, 2023 increased to $3,263,000 compared to $2,900,000 for the year ended December 31, 2022 primarily as a result of (i) the increase in exploration expense at our Golden Crest project to $1,798,000 during 2023 compared to $1,505,000 of exploration expense incurred at our Golden Crest project during 2022;

(ii) an increase in our reconnaissance exploration expenditures to $135,000 during 2023 compared to reconnaissance exploration expenditures of $94,000 during 2022;

(iii) an increase in general and administrative expense to $1,712,000 during 2023 compared to general and administrative expense of $1,360,000 during 2022;

(iv) a decrease in the cash provided from a reduction in prepaid expenses and other current assets to $20,000 during 2023 compared to cash provided from a reduction in prepaid expenses and other current assets of $265,000 during 2022;

and (v) other income of $20,000 during 2022, with no similar item during 2023.

Partially offsetting these additional expenditures and the overall uses of cash in operations during 2023 compared to 2022 were (i) a reduction in the exploration expenditures at our Lik project to $404,000 during 2023 compared to exploration expenditures of $668,000 during 2022;

(ii) an increase in accounts payable and other current liabilities of $328,000 during 2023 compared to an decrease in accounts payable and other current liabilities as a use of cash of $51,000 during 2022;

and (iii) an increase in interest and dividend income to $191,000 during 2023 compared to interest and dividend income of $131,000 during 2022.

Net cash used in operations during the year ended December 31, 2024 increased to $5,099,000 compared to $3,263,000 for the year ended December 31, 2023 primarily as a result of (i) the increase in exploration expense at our Golden Crest project to $3,884,000 during 2024 compared to $1,798,000 of exploration expense incurred at our Golden Crest project during 2023, primarily related to increased expenditures for the drilling program at Golden Crest completed during 2024;

(ii) an increase in general and administrative expense to $1,879,000 during 2024 compared to general and administrative expense of $1,712,000 during 2023;

and (iii) a use of cash resulting from a decrease in accounts payable and other current liabilities of $379,000 during 2024 compared to an provision of cash from and increase in accounts payable and other current liabilities of $328,000 during 2023.

Partially offsetting these expenditures and the overall uses of cash in operations during 2024 compared to 2023 were (i) an increase in interest and dividend income to $372,000 during 2024 compared to interest and dividend income of $191,000 during 2023;

(ii) an increase in the cash provided from a reduction in prepaid expenses and other current assets of $207,000 during 2024 compared to cash provided from a reduction in prepaid expenses and other current assets of $20,000 during 2023;

(iii) a decrease in our reconnaissance exploration expenditures to $73,000 during 2024 compared to reconnaissance exploration expenditures of $135,000 during 2023;

and (iv) a decrease in our exploration expenditures at our Lik project to $142,000 during 2024 compared to exploration expenditures at the Lik project of $404,000 during 2023.

These items are discussed in further detail above under “Results of Operations.”

Net cash used by investing activities was $4,409,000 during 2023 compared to net cash provided by investing activities of $701,000 during 2022.

The primary reasons for the increase in cash used by investing activities are (i) an increase in the cash used to purchase short-term investments of $4,429,000 during 2023 compared to the provision of cash from the sale of short-term investments of $1,028,000 during 2022;

Net cash provided by investing activities was $3,938,000 during 2024 compared to net cash used by investing activities of $4,409,000 during 2023.

The primary reasons for the decrease in cash used by investing activities are (i) an increase in the cash provided by the sale of short-term investments of $3,913,000 during 2024 compared to the use of cash from the net purchase of short-term investments of $4,429,000 during 2023;

and (ii) cash from the sale of marketable equity securities of $54,000 during 2024 compared with no sales of marketable equity securities during 2023.

Partially offsetting these items were (i) no additions to mineral properties for initial acquisition costs during 2023 compared to the use of cash of $340,000 capitalized as mineral properties for initial acquisition costs during 2022;

(ii) the sale of calls on the shares of Kinross common stock we own for cash proceeds of $31,000 with no similar sales of derivative instruments during 2022;

and (iii) a reduction in cash used for additions to other assets to $11,000 during 2023 compared to cash used for additions to other assets of $50,000 during 2022.

Partially offsetting these items were (i) additions to mineral properties for initial acquisition costs of $55,000 during 2024 compared to no initial acquisition costs for mineral properties during 2023.

We anticipate we will continue to utilize proceeds from the sale of our short-term investments and any proceeds we may derive from potential sales of marketable equity securities to fund our operations during 2025.

Our net cash provided by financing activities during 2023 was from (i) the sale of 12,798,485 shares of our common stock from private placements for net cash of $7,097,000 discussed above under “Equity offering private placements,” after certain direct costs related to the amendment of certain terms of the ATM Program of $46,000 and entering into the Consulting Contract of $6,000, discussed above;

Our net cash provided by financing activities during 2024 was from (i) the sale of 1,802,060 shares of our common stock under the ATM Program at an average price of $0.70 per share for net proceeds after expenses of $1,218,000, and (ii) the exercise of options for 250,000 shares of our common stock for net proceeds of $54,000.

and (ii) the exercise of options for 1,486,500 shares of our common stock for net proceeds of $459,000.

Our net cash provided by financing activities during 2022 was from (i) the sale of 2,650,724 shares of our common stock under the ATM Program at a price of $0.79 per share for net proceeds of $2,023,000, and (ii) the exercise of options for 114,250 shares of our common stock for net proceeds of $30,000.

We may utilize the ATM Program during 2024 to supplement our existing cash resources, however we will only use the ATM Program when we believe the market conditions based upon the quoted price of a share of our common stock is appropriate.

We do not expect the exercise of options nor the issuance of shares in private placements to be a significant source of cash during 2024.

We may utilize the ATM Program during 2025 to supplement our existing cash resources, however we intend to only use the ATM Program when we believe the market conditions based upon the quoted price of a share of our common stock is appropriate.

Although we anticipate that a portion of our outstanding stock options currently in the money at December 31, 2024 will be exercised during 2025, we have not planned that the exercise of options or the issuance of shares in private placements will be a significant source of cash during 2025.

Development Activities, Exploration Activities, Environmental Compliance and Contractual Obligations

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Our net 2024 mineral and surface property filing rental and option payments, included in exploration expense, were $493,000.

Our 2024 total exploration property rentals and option payments for properties we own, have under joint venture, or operate are estimated to be approximately $1,606,000.

Our 2025 total exploration property claim fees, rentals and option payments for properties we own, have under joint venture, or operate are estimated to be approximately $1,191,000.

Assuming that our joint ventures continue in their current status and that we do not appreciably change our property positions on existing properties, we estimate that our joint venture partners will pay on our behalf or reimburse us approximately $674,000 of these annual payments.

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The following table provides an analysis of our contractual obligations:

(in thousands)

As of December 31, 2024

Payments due by period

Less than 1 year

More than 5 years

(in thousands)

Operating Lease Obligations (1)

Mineral property option and lease payments (2)

Lease obligation on our Wheat Ridge, Colorado office.

Lease obligation payments on our Wheat Ridge, Colorado office.

Mineral property payments under lease and property claim and concession payments for the next year, net of joint venture payments.

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Solitario acquired its initial interest in the Golden Crest project during 2021.

During 2023 and 2022 Solitario conducted exploration activities on the Golden Crest project including grid soil and grab rock sampling, hand trenching, mapping, induced polarization ground geophysics, permitting and geotechnical work.

During 2022 through 2024 Solitario conducted exploration activities on the Golden Crest project including grid soil and grab rock sampling, hand trenching, mapping, induced polarization ground geophysics, permitting and geotechnical work.

Over twenty gold-enriched target areas have been identified, with fourteen of these areas containing multi-gram gold per tonne assays.

In December 2023, the USFS issued a Draft Decision Notice and Finding of No Significant Impact.

Pending the issuance of a final FONSI, and if permits to drill are received during 2024 field season, Solitario is planning to conduct a 5,000-meter drilling program consisting of approximately eight to twelve exploration core holes.

In 2024 Solitario completed drilling of eleven core holes totaling 4,346 meters.

The results included several holes with multi-gram gold mineralization as six of the eleven holes intersected gold grades exceeding one gpt.

Higher grade paleo-placer grades were intersected as well as Precambrian rock formations, which provide some confirmation of Solitario’s theoretical geologic interpretation of potential economic mineralization at depth at Golden Crest During 2025 Solitario is planning to conduct a phase-one, 4,000-meter drilling program consisting of up to 15 additional exploration core holes.

Depending on drilling results and receiving permits Solitario may initiate a phase-two drilling program during 2025 and 2026.

In addition, we will be continuing a surface exploration program during 2025 consisting of prospecting for new areas of mineralization through the collection of select rock grab samples, systematic soil sampling and, potentially, geophysics.

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Concentrates would be trucked to Nexa’s Cajamarquilla zinc smelter facility in Lima, Peru.

During 2023, Nexa advanced the project through (i) the completion and upgrade of the road access to the property and local communities;

(ii) completion of a phase 5 permit for additional drilling platforms as well as underground workings;

(iii) signing a two-year exploration agreement with local communities;

and (iv) initial drilling in the Florida Sur area which resulted in two core holes totaling 1,362 meters to test for potential extensions of the San Jorge zone to the south.

Nexa’s planned 2024 expenditures include a comprehensive evaluation of all its geologic data to develop a future drilling program.

Future drilling is expected to test extensions of the Florida Canyon area, but more importantly as many as four new totally un-drill tested prospects to the east and south.

During 2024 Nexa spent approximately $2.0 million on the Florida Canyon project including an upgrade to the access road to the project, social and community projects in the areas of health, education and commercial opportunities.

Nexa also began a re-evaluation of the Florida Canyon resource model, which will continue through 2025.

This re-evaluation is intended to evaluate the upside potential as well as identify new high-priority drill targets within the current footprint of the deposit.

The Lik project is an advanced-staged high-grade zinc project consisting of 47 contiguous Alaska state mining claims.

The project is held in a joint venture between Teck (50%) and Solitario (50%).

During 2023 and 2022 Teck completed a total of four core drill holes.

A PEA was completed in 2014 on the Lik deposit that envisioned an open pit mining operation with a 5,500 ton per day floatation mill for processing resulting in a nine-year mine life.

Concentrates would be handled through the DeLong Mountain Regional Transportation System road and port system that currently handles all concentrate produced by the nearby Red Dog zinc mine of Teck.

Alternate development scenarios might be developed utilizing Red Dog infrastructure under the control of Teck.

However, no agreements are in place to develop such plans and are therefore hypothetical.

During 2024, Teck completed its ZTEM inversion process and an airborne geophysical program it completed in 2024.

Teck also worked on a 3D geologic model and previously completed ground gravity geophysical survey as well as ongoing environmental site work.

Teck believes there is potential for additional drill targets, based on ZTEM inversion modelling, geologic mapping, and ground gravity.

Solitario and Teck are in final discussions to fund a 2025 work program, with Teck acting as project manager.

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Nexa is responsible for maintaining the property in good standing and making all concession payments to the Peruvian government.

Solitario leased a 100% interest in the Cat Creek project in south-central Colorado from a private third party in 2023.

Solitario has only conducted very limited work on the property to date and during 2024 secured permits for two drill hole locations.

Solitario is planning a limited exploration program at Cat Creek for 2025 and currently although no decision has been made to drill at Cat Creek during 2025.

2025 Planned Expenditures

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We will continue the evaluation of potential new acquisitions of properties primarily in the United States around the Golden Crest project as well as other regions of North and South America.

We expect to carry out our exploration activities during 2024 utilizing Teck at Lik, Nexa at Florida Canyon, and our own employees and contract geologists at Golden Crest and other projects.

We expect to carry out our exploration activities during 2025 utilizing Teck at Lik, Nexa at Florida Canyon, and our own employees and contract geologists at Golden Crest and Cat Creek projects.

Discontinued Projects

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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 7. Management’s Discussion and Analysis