What changed in this filing

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Item 8. Financial Statements and Supplementary Data

2025-03-12 compared with 2024-03-22 · 111 added, 141 removed, 427 unchanged (37% of the section changed)

2 unchanged sentences

Report of Independent Registered Public Accounting Firm ( Assure CPA, LLC , Spokane, Washington , PCAOB ID 444 )

Report of Independent Registered Public Accounting Firm (Plante & Moran, PLLC, Denver, Colorado, PCAOB ID 166)

Consolidated Balance Sheets as of December 31, 2024 and 2023

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We have audited the accompanying consolidated balance sheet of Solitario Resources Corp.

(“the Company”) as of December 31, 2023, and the related consolidated statement of operations, statement of shareholders’ equity and cash flows for the year 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, 2023, 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.

(“the Company”) as of December 31, 2024 and 2023, and the related consolidated statement of operations, statement of shareholders’ equity and 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, 2024 and 2023, 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.

Basis for Opinion

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 audit.

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.

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 consolidated financial statements, whether due to error or fraud, and performing procedures that respond to those risks.

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 audit 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.

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 audit provides a reasonable basis for our opinion.

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March 11, 2025

Report of Independent Registered Public Accounting Firm

To the Shareholders and Board of Directors of Solitario Resources Corp.

Opinion on the Consolidated Financial Statements

We have audited the accompanying consolidated balance sheet of Solitario Resources Corp.

(fka Solitario Zinc Corp.) (the “Company”) as of December 31, 2022, the related consolidated statements of operations, shareholders' 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 referred to above present fairly, in all material respects, the financial position of the Company as of December 31, 2022, 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.

Basis for Opinion

The Company's management is responsible for these financial statements.

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

We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (the “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.

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.

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.

Critical Audit Matters

Critical audit matters are matters arising from the current period audit of the financial statements that were communicated or required to be communicated to the audit committee and that:

(1) relate to accounts or disclosures that are material to the financial statements and (2) involved especially challenging, subjective, or complex judgments.

We determined that there are no critical audit matters.

/s/ Plante & Moran, PLLC

We served as the Company’s auditor from 2004 through 2023.

Denver, Colorado

March 15, 2023

SOLITARIO RESOURCES CORP.

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(in thousands of U.S.

dollars, except share and per share amounts)

Dollars, except share amounts)

Current assets:

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Mineral properties

Restricted cash – mineral property reclamation bonds

Liabilities and Shareholders’ Equity

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Accounts payable

Kinross call option liability

Operating lease liability

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Long-term liabilities:

Asset retirement obligation – Lik

Asset retirement obligation and reclamation liabilities

Operating lease liability

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Exploration expense

Depreciation and amortization

General and administrative

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Interest and dividend income

Gain (loss) on derivative instruments

Loss on sale of marketable equity securities

Unrealized gain (loss) on short-term investments

Unrealized gain (loss) on marketable equity securities

Total other income (expense)

(Loss) gain on derivative instruments

Gain on sale of marketable equity securities

Unrealized gain on short-term investments

Unrealized gain on marketable equity securities

Total other income

Net loss per common share

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Weighted average shares outstanding

Basic and diluted

Basic and diluted (in thousands)

See Notes to Consolidated Financial Statements.

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Balance at December 31, 2022

Stock-based compensation

Issuance of shares – option exercises

Issuance of shares – ATM, net

Balance at December 31, 2022

Stock-based compensation expense

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Balance at December 31, 2023

Stock-based compensation expense

Issuance of shares – ATM

Issuance of shares – option exercises

Balance at December 31, 2024

See Notes to Consolidated Financial Statements.

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Adjustments to reconcile net loss to net cash used in operating activities:

Unrealized (gain) loss on marketable equity securities

Unrealized (gain) loss on short-term investments

Loss on sale of marketable equity securities

Gain (loss) on derivative instruments

Unrealized gain on marketable equity securities

Unrealized gain on short-term investments

Gain on sale of marketable equity securities

Loss (gain) on derivative instruments

Stock-based compensation expense

Amortization of right of use lease asset

Increase in asset retirement and reclamation liabilities

Changes in operating assets and liabilities:

Current assets

Current liabilities

Prepaid expenses and other current assets

Accounts payable and other current liabilities

Net cash used in operating activities

Investing activities:

(Purchase) sale of short-term investments – net

Additions to mineral property

Sale (purchase) of short-term investments – net

Additions to mineral properties

Sale of marketable equity securities

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Net cash provided by financing activities

Net decrease in cash and cash equivalents

Cash and cash equivalents, beginning of year

Cash and cash equivalents, end of year

Net increase (decrease) in cash and cash equivalents

Cash, cash equivalents and restricted cash, beginning of year

Cash, cash equivalents and restricted cash, end of year

Non-cash financing and investing activities:

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Solitario is primarily focused on the acquisition and exploration of precious metal, zinc and other base metal exploration mineral properties.

In addition to focusing on its mineral exploration properties and the evaluation of mineral properties for acquisition, Solitario also evaluates potential strategic transactions for the acquisition of new precious and base metal properties and assets with exploration potential or business combinations that Solitario determines to be favorable to Solitario.

In addition to focusing on its mineral exploration properties and the evaluation of mineral properties for acquisition, Solitario from time to time also evaluates potential strategic transactions for the acquisition of new precious and base metal properties and assets with exploration potential or business combinations that Solitario determines to be favorable to Solitario.

Solitario has recorded revenue in the past from the sale of mineral properties, including the sale of certain mineral royalties.

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Solitario currently considers its carried interest in the Florida Canyon zinc project in Peru (the “Florida Canyon project"), its interest in the Lik zinc project in Alaska (the “Lik project”), and its Golden Crest project in South Dakota (the “Golden Crest project”) to be its core mineral property assets.

Solitario also has its Cat Creek project, an early-stage exploration project in Colorado (the “Cat Creek project”).

Nexa Resources, Ltd.

(“Nexa”), Solitario’s joint venture partner, is continuing the exploration and furtherance of the Florida Canyon Project and Solitario is monitoring progress at Florida Canyon.

(“Nexa”), Solitario’s joint venture partner, is continuing the exploration and furtherance of the Florida Canyon project and Solitario is monitoring progress at the Florida Canyon project.

Solitario is working with its 50% joint venture partner in the Lik project, Teck American Incorporated, a wholly-owned subsidiary of Teck Resources Limited (both companies are referred to as “Teck”), to further the exploration and evaluate potential development plans for the Lik project.

Solitario is conducting mineral exploration on the Golden Crest Project on its own.

As of December 31, 2023, Solitario has balances of cash and short-term investments that Solitario anticipates using, in part, to further the development of the Florida Canyon project, the Lik project and the Golden Crest project and to potentially acquire additional mineral property assets.

Solitario is conducting mineral exploration on the Golden Crest project and the Cat Creek project on its own.

As of December 31, 2024, Solitario has balances of cash and short-term investments that Solitario anticipates using, in part, to further the development of the Florida Canyon project, the Lik project, the Golden Crest project and the Cat Creek project, and to potentially acquire additional mineral property assets.

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

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Redemption is permitted daily without written notice.

Solitario’s money market funds of $ 4,523,000 and $ 7,738,000 , respectively, at December 31, 2024 and 2023 are included in short-term investments.

Restricted cash

Solitario’s restricted cash represents investments in certificates of deposit and are restricted primarily for reclamation funding or surety bonds.

Restricted cash and cash equivalents balances are carried at fair value.

Non-current restricted cash is reported in a separate line on the consolidated balance sheets and totaled $ 230,000 at December 31, 2024.

There were no restricted cash amounts at December 31, 2023.

Cash, excluding restricted cash, at December 31, 2024 and 2023 was $ 81,000 and $ 200,000 , respectively.

Short-term investments

Solitario’s investments in short-term securities are classified as held for sale securities and recorded at their quoted fair market values.

Solitario’s short-term investments at December 31, 2024 consists of its investment of $ 4,523,000 in a money market account held in a brokerage firm.

At December 31, 2023 Solitario’s short term investments included a money market account of $ 7,738,000 and United States Treasury Securities (“USTS”) of $ 698,000 with maturities between one and two months.

Interest income and unrealized gains or losses are recorded in the statement of operations in the period when they occur.

At December 31, 2023, Solitario has United States Treasury securities (“USTS”) with maturities of less than two months, recorded at their fair value of $ 698,000 compared to USTS recorded at their fair value of $ 3,951,000 at December 31, 2022.

Solitario has included $ 7,738,000 in a money market fund held in a brokerage account in short-term investments.

The short-term investments 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.

During the year ended December 31, 2023 the unrealized gain on USTS (increase) in the fair value of its short-term investments, due primarily to changes in interest rates on held securities, was $ 56,000 .

During the year ended December 31, 2022 the unrealized loss (decrease) in the fair value of its short-term investments, due primarily to changes in interest rates on held securities, was $ 108 ,000.

Mineral properties

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The grant date fair value is amortized on a straight-line basis over the vesting term of the option, and the stock-based compensation is charged to the statement of operations and credited to additional-paid-in-capital.

Solitario accounts for forfeitures in the year they occur.

See Note 10, “Employee Stock Compensation Plans,” below.

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Expected reclamation costs are periodically reviewed and adjusted to reflect changes related to on-going exploration activities, inflation and on-going activities that reduce potential future reclamation liabilities.

Exploration reclamation liabilities on properties without asset retirement obligations are charged to expense when incurred.

Solitario does not apply a discount rate to its asset retirement obligation as the estimated time frame for reclamation on its exploration projects is not currently known, as reclamation is not expected to occur until the end of project life, which would follow future development and operations, the start of which cannot be estimated or assured at this time.

Additionally, no depreciation will be recorded on the related asset for the asset retirement obligation until the project goes into operation, which cannot be assured.

Segment reporting

Solitario operates as a single operating segment in accordance with FASB ASU 2023-07 Segment Reporting (Topic 280):

Improvements to Reportable Segment Disclosures .

All financial information is presented on a consolidated basis and reviewed by Solitario’s Chief Executive Officer as the Chief Operating Decision Maker (CODM).

The CODM uses consolidated net loss, as presented in the consolidated statement of operations, to assess segment performance and allocate resources.

The measure of segment assets is reported on the balance sheet as total consolidated assets.

Adopted accounting pronouncements

The Company has adopted ASU No.

2023-07, “Segment Reporting (Topic 280):

Improvements to Reportable Segment Disclosures.” This amended guidance applies to all public entities and aims to improve reportable segment disclosure requirements, primarily through enhanced disclosures about significant segment expenses, to enable investors to develop more decision-useful financial analyses.

This guidance is effective for fiscal years beginning after December 15, 2023 and interim periods within fiscal years beginning after December 15, 2024.

Recent accounting pronouncements

In August 2023, the FASB issued ASU 2023-05, Business Combinations - Joint Venture Formations (Subtopic 805-60):

In August 2023, the FASB issued Accounting Standards Update (“ASU”) 2023-05, Business Combinations - Joint Venture Formations (Subtopic 805-60):

Recognition and Initial Measurement, which clarifies the business combination accounting for joint venture formations.

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Solitario does not anticipate early adoption.

Solitario is evaluating the new guidance and has not determined the impact of ASU No.

2023-05 on its consolidated financial statements.

Solitario is evaluating the new guidance and has not yet determined the impact of ASU 2023-05 on its consolidated financial statements.

In December 2023, the FASB issued ASU 2023-09, Income Taxes (Topic 740):

Improvement to Income Tax Disclosures, amending income tax disclosure requirements for the effective tax rate reconciliation and income taxes paid.

The amendments in ASU 2023-09 are effective for fiscal years beginning after December 15, 2024 and are applied prospectively.

Improvements to Income Tax Disclosures, amending income tax disclosure requirements for the effective tax rate reconciliation and income taxes paid.

The amendments in ASU 2023-09 are effective for public business entities for fiscal years beginning after December 15, 2024 and are applied prospectively.

Early adoption and retrospective application of the amendments are permitted.

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Solitario is subject to various risks and uncertainties that are specific to the nature of its business and the exploration of its mineral properties.

Solitario also faces various macro risks and uncertainties, such as risks related to health epidemics, pandemics, and other outbreaks or resurgences of communicable diseases, the occurrence of natural disasters, environmental impacts including compliance with environmental laws and permitting requirements, rising geopolitical tension and instability, acts of war or terrorism, global economic uncertainty, inflationary pressures, increased interest rates, and volatility and disruption in national and international financial markets.

These risks and uncertainties could significantly disrupt Solitario’s operations and may materially and adversely affect its business and financial condition.

Solitario will continue taking proactive steps to monitor and address the impacts of these risks and uncertainties on its operations, financial condition, and liquidity.

Such steps may include, for example, modifying the scope of exploration projects to the extent necessary to respond to public-health emergencies, a step Solitario and its joint venture partners took to address the impacts of the COVID-19 pandemic;

reducing costs and increasing operational efficiency in response to inflationary stress and economic downturn;

and performing ongoing evaluations of the potential impacts of market volatility, general economic uncertainty, and rising geopolitical tension on Solitario’s ability to access future traditional funding sources on the same or reasonably similar terms as in past periods.

While Solitario will continue to monitor and address the effects of these risks and uncertainties, the extent to which they ultimately impact Solitario’s business, including its exploration and other activities and the market for its securities, will depend on future developments, which are highly uncertain and cannot be predicted at this time.

Solitario also faces various macro-economic risks and uncertainties, such as risks related to health epidemics, pandemics, and other outbreaks or resurgences of communicable diseases, the occurrence of natural disasters, rising geopolitical tension and instability, acts of war or terrorism, global economic uncertainty, inflationary pressures, interest rate volatility, and volatility and disruption in national and international financial markets.

Mineral Properties :

The following table details Solitario’s capitalized mineral property:

The following table details Solitario’s capitalized mineral properties:

(in thousands)

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Golden Crest (South Dakota – US)

Total exploration mineral property

Cat Creek (Colorado – US)

Total exploration mineral properties

Exploration property

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Through December 31, 2024, Solitario has staked additional mineral claims, including some claims included in an area of interest of the GC Claims and claims not related to the GC Claims, as part of the Golden Crest project.

As of December 31, 2023 and 2022 Solitario has capitalized costs for staking, initial filing fees, legal and other costs of $ 1,035,000 as initial acquisition costs related to the Golden Crest project.

As of December 31, 2024, Solitario has capitalized costs for staking, initial filing fees, legal and other costs of $ 1,078,000 as initial acquisition costs related to the Golden Crest project.

During 2024 Solitario purchased a certificate of deposit of $ 100,000 for reclamation bonding as part of the Golden Crest drilling permit received and is recorded as restricted cash in the consolidated balance sheet at December 31, 2024.

Solitario holds a 50% operating interest in the Lik zinc-lead sliver property in northwest Alaska, which we acquired as part of the acquisition of Zazu Metals Corporation (“Zazu”) in July 2017.

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Nexa is required to fund 100% of exploration expenditures at the Florida Canyon project, until Nexa commits to put the project into production based upon a positive feasibility study, at which time Nexa’s interest will increase from its current 61% interest to a 70% interest.

During 2023 Solitario entered into a lease agreement with Cat Creek LLC, the underlying owner of certain mineral claims in Colorado covering the Cat Creek project (the “Cat Creek Agreement”).

During 2024 Solitario capitalized its initial payments of $ 12,000 related to the Cat Creek project.

Per the terms of the Cat Creek Agreement, to maintain the lease, Solitario has agreed to pay, at its option, additional annual payments totaling $ 127,000 through July 2028, of which $ 12,000 has been paid through December 31, 2024.

In addition, to maintain the lease, Solitario has agreed to escalating work commitments on the Cat Creek claims and the related area of interest around the Cat Creek claims totaling $ 2,270,000 through December 31, 2029, with additional work commitments totaling $ 750,000 per year until December 2033.

Solitario has exceeded the minimum exploration expenditure required through December 31, 2024.

The underlying owner retained a 2.0 % Net Smelter Return royalty.

Solitario will have the option, but not the obligation, to reduce the Net Smelter Return royalty to 1.0 % by paying the owner $ 1,000,000 .

During 2024 Solitario purchased a certificate of deposit of $ 130,000 for reclamation bonding as part of the Cat Creek drilling permit received and is recorded as restricted cash in the consolidated balance sheet at December 31, 2024.

Exploration Expense

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Total exploration expense

Asset Retirement Obligation

Asset Retirement Obligation and Reclamation Liabilities

Solitario recorded an asset retirement obligation of $ 125,000 upon the acquisition of the Lik project for Solitario’s estimated reclamation cost of the existing disturbance at the Lik project.

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The estimate was based upon estimated cash costs for reclamation as determined by Solitario and its joint venture partner Teck and is supported by a permitting bond required by the State of Alaska, for which Solitario has retained a reclamation bond insurance policy in the event Solitario or its 50% partner, Teck, do not complete required reclamation.

Solitario has not applied a discount rate to the recorded asset retirement obligation as the estimated time frame for reclamation is not currently known, as completion reclamation is not expected to occur until the end of the related project life, which would follow future development and operations, the start of which cannot be estimated or assured at this time.

Additionally, no depreciation will be recorded on the related asset for the asset retirement obligation until the Lik project goes into operation, which cannot be assured.

As of December 31, 2024 and 2023, Solitario has no reclamation liability at its Florida Canyon project as Nexa is responsible for the costs at Florida Canyon, including reclamation, if any.

In addition, the activities to date at Solitario’s Golden Crest project of staking claims and mapping, soil and rock sampling, and assaying have not created any material environmental or other disturbances.

Historically Solitario’s exploration activities have not resulted in any long-term environmental disturbances or liabilities and where there have been required restoration of disturbances, these have been completed contemporaneously with the completion of our mineral exploration activities.

As of December 31, 2023 and 2022 Solitario has no reclamation liability at its Golden Crest project, as all of the activities to date at Golden Crest have consisted of hand-collected surface sampling and related non-disturbance geophysical studies.

Certain minimal disturbances, such as trenching, which has been limited to existing roads, are concurrently remediated and do not require on-going or future reclamation.

In addition, the activities to date at Solitario’s Cat Creek project of staking claims and mapping, soil and rock sampling, and assaying have not created any material environmental or other disturbances.

Solitario is also involved in certain matters concerning its 2024 drilling program remediation at its Golden Crest project.

Generally, the bulk of remediation at Golden Crest associated with its 2024 drilling program was carried out concurrently with drilling activities, with only ongoing contouring and reseeding of drill sites remaining as of December 31, 2024.

At December 31, 2024, Solitario has recorded a reclamation liability of $ 20,000 , included in asset retirement and reclamation liabilities related to the Golden Crest project.

Marketable Equity Securities

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

During 2024 Solitario sold 100,000 shares of Highlander Silver Corp.

common stock for proceeds of $ 54,000 and recorded a realized gain on sale of $ 54,000 .

Solitario did not sell any of its marketable equity securities during 2023.

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Marketable equity securities at fair value

The following table represents changes in marketable equity securities:

(in thousands)

Cost of marketable equity securities sold

Realized loss on marketable equity securities sold

Proceeds from the sale of marketable equity securities sold

Net gain (loss) on marketable equity securities

Change in marketable equity securities at fair value

The following table represents the realized and unrealized gain (loss) on marketable equity securities:

(in thousands)

Unrealized gain (loss) on marketable equity securities

Realized loss on marketable equity securities sold

Net gain (loss) on marketable equity securities

During 2022, Solitario sold rights to certain exploration data on a non-owned mineral property upon which Solitario had previously done exploration activities.

The data was sold to Highlander Silver Corp., a Canadian exploration company (“Highlander”) for $ 20,000 cash and 200,000 shares of Highlander common stock.

On the date of sale, the Highlander common stock carried a restrictive legend.

The shares were not available for trade on the date of sale and at December 31, 2022 and no value has been assigned to the common stock as of December 31, 2022.

Solitario recorded $20,000 of other income on the date of the sale.

The change to the value of the Highlander common stock owned by Solitario during 2023 was included in the changes in value of marketable equity securities.

Unrealized gain on marketable equity securities

Realized gain on marketable equity securities sold

Net gain on marketable equity securities

Operating Lease

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The discount rate within the WR Lease is not determinable and Solitario applied a discount rate of 7 % based upon Solitario’s estimate of its cost of capital in recording the WR Lease.

Solitario has $ 96,000 remaining cash payments as of December 31, 2023.

The following is supplemental cash flow information related to our operating lease for 2023 and 2022:

(in thousands)

Year ended December 31, 2023

Year ended December 31, 2022

Cash paid for amounts included in the measurement of lease liabilities:

Operating cash outflows from WR Lease payments

Non-cash amounts related to the WR lease:

Right of use assets recorded in exchange for new operating lease liabilities

Solitario has $ 52,000 remaining cash payments as of December 31, 2024, of which $ 2,000 is imputed interest on the WR Lease, and Solitario has recorded the remaining $ 50,000 lease liability as $ 43,000 as a current liability and $ 7,000 as non-current liability in the consolidated balance sheet.

The following items comprised other assets:

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Stock option compensation expense

Unrealized loss on derivative securities

Unrealized loss on short-term investments

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State income tax

Expiration of Capital Loss and Foreign Tax Credit Carryovers

Adjustment to Deferred Taxes

Foreign currency exchange

Change in valuation allowance

Change in Tax Rates

Prior year return reconciliation

Permanent differences and other

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Federal NOL carryovers incurred prior to 2018 expire after 20 years.

Solitario has Federal NOL carryovers incurred prior to 2018 which begin expiring in 2027.

Solitario has $ 12,769,000 of Federal NOL carryovers incurred prior to 2018 which begin expiring in 2027.

Solitario has State NOL carryovers in Colorado, Montana, and Alaska of $ 27,833,000 which begin expiring in 2026.

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Derivative Instruments:

Covered call options:

From time-to-time Solitario has sold covered call options against its holdings of shares of common stock of Kinross included in Marketable Equity Securities.

The business purpose of selling covered calls is to provide additional income on a limited portion of shares of Kinross that Solitario may sell in the near term, which is generally defined as less than one year and any changes in the fair value of its covered calls are recognized in the statement of operations in the period of the change.

During 2024, Solitario sold covered calls against its holdings of Kinross for net proceeds of $ 38,000 , recorded an unrecognized loss of $ 29,000 during the year ended December 31, 2024 and recorded a liability for its outstanding covered call at December 31, 2024 of $ 67,000 .

At December 31, 2024 Solitario has outstanding covered calls against all of its holdings of Kinross common stock with an exercise price of $ 10.00 per share with an exercise date of May 16, 2025.

During 2023, Solitario sold covered calls against its holdings of Kinross for cash proceeds of $ 31,000 all of which expired unexercised.

During 2022, Solitario recorded a loss of $ 4,000 related to certain Vendetta warrants it held, which expired unexercised during 2022.

Fair Value of Financial Instruments :

For certain of Solitario's financial instruments, including cash and cash equivalents, and short-term investments the carrying amounts approximate fair value due to their short maturities.

Solitario's marketable equity securities, including its investment in shares of Kinross common stock, Vendetta common stock, and Vox common stock are carried at their estimated fair value based on publicly available quoted market prices.

Solitario's marketable equity securities, including its investment in shares of Kinross common stock, Vendetta common stock, and Vox Royalty common stock are carried at their estimated fair value based on publicly available quoted market prices.

Solitario applies ASC 820 that establishes a framework for measuring fair value and requires enhanced disclosures about fair value measurements within a hierarchy between Level 1:

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Marketable equity securities

Kinross calls

The following is a listing of Solitario’s financial assets and liabilities required to be measured at fair value on a recurring basis and where they are classified within the hierarchy as of December 31, 2023:

4 unchanged sentences

Short-term investments:

At December 31, 2023 and 2022, Solitario’s holdings of short-term investments consist of USTS recorded at their fair values of $ 698,000 and $ 3,951,000 , respectively, based upon quoted market prices.

In addition, at December 31, 2023 Solitario has $ 7,738,000 in a money market account included in short-term investments.

At December 31, 2024 and 2023 Solitario has $ 4,523,000 and $ 7,738,000 , respectively, in a money market account included in short-term investments.

In addition, at December 31, 2023, Solitario’s holdings include short-term investments of USTS recorded at their fair values of $ 698,000 based upon quoted market prices.

Marketable equity securities :

At December 31, 2023 and 2022, the fair value of Solitario’s holdings in shares of Vendetta, Kinross, and Vox marketable equity securities are based upon quoted market prices.

During the year ended December 31, 2023, Solitario did not change any of the valuation techniques used to measure its financial assets and liabilities at fair value.

At December 31, 2024 and 2023, the fair value of Solitario’s holdings in shares of Vendetta, Kinross, and Vox Royalty marketable equity securities are based upon quoted market prices.

During the year ended December 31, 2024 and 2023, Solitario did not change any of the valuation techniques used to measure its financial assets and liabilities at fair value.

Commitments and Contingencies:

In acquiring its interests in mineral claims and leases, Solitario has entered into lease agreements, which may be canceled at its option without penalty.

Solitario is required to make minimum rental and option payments in order to maintain its interests in certain claims and leases.

At December 31, 2024 and 2023, Solitario has recorded an asset retirement and reclamation liability obligation of $ 145,000 and $ 125,000 , respectively, related to its Lik and Golden Crest projects.

See Note 2 “Mineral Properties,” above.

Solitario estimates its 2024 property claim, lease and option payments for properties Solitario owns, has under joint venture or Solitario operates to be approximately $ 1,606,000 .

Assuming that Solitario’s joint ventures continue in their current status and that Solitario does not appreciably change its property positions on existing properties, approximately $ 1,220,000 of these estimated 2024 property claim, lease and rental payments are paid or are reimbursable to us by Solitario’s joint venture partners.

Solitario may be required to make further payments in the future if it acquires new properties or enters into new agreements.

Solitario leases office space under a non-cancelable operating lease for the Wheat Ridge, Colorado office which provides for future total minimum rent payments as of December 31, 2024 of $ 52,000 through February 2026.

Employee Stock Compensation Plans:

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a.) Stock option grants

The following table shows the grant date fair value of Solitario’s awards during 2023 and 2022 pursuant to the 2013 Plan and the 2023 Plan:

The following table shows the grant date fair value of Solitario’s awards during 2024 and 2023 pursuant to the 2023 Plan.

There were no grants under the 2013 Plan in 2024 or 2023.

Option – grant date price

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( 1,486,500 )

( 2,360,000 )

Outstanding, end of year

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Intrinsic value based upon December 31, 2024 and 2023 price of a share of Solitario common stock as quoted on the NYSE American exchange of $ 0.59 and $ 0.56 , respectively, per share.

For options exercised during 2023 the intrinsic value based upon the price of a share of Solitario common stock as quoted on the NYSE American on the date of exercise of each option.

During the years ended December 31, 2023 and 2022, Solitario recorded $ 247,000 and $ 338,000 , respectively, of stock-based compensation expense under the 2023 Plan and the 2013 Plan for the amortization of the grant date fair value of each of its outstanding options with a credit to additional paid-in-capital.

For options exercised during 2024 and 2023 the intrinsic value based upon the price of a share of Solitario common stock as quoted on the NYSE American on the date of exercise of each option.

During the years ended December 31, 2024 and 2023, Solitario recorded $ 666,000 and $ 247,000 , respectively, of stock-based compensation expense under its 2023 Plan and 2013 Plan for the amortization of the grant date fair value of each of its outstanding options with a credit to additional paid-in-capital.

At December 31, 2024, the total unrecognized stock option compensation cost related to non-vested options is $ 841,000 and is expected to be recognized over a weighted average period of 25 months.

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Solitario 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, Solitario 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 the closing market price of $ 0.51 per share as quoted on the NYSE-American.

On November 16, 2023, Solitario 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 the closing market price of $ 0.51 per share as quoted on the NYSE-American.

The issuance of the shares was made through a subscription agreement between Solitario and the advisory firm.

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No cash was paid for the issuance of the shares.

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

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

At the Market Offering Agreement

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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 2023, Solitario recorded $ 46,000 as a charge to additional paid-in-capital for one-time expenses related the amendment of the ATM Agreement.

During 2023, Solitario recorded $ 46,000 as a charge to additional paid-in-capital for one-time expenses related to the amendment of the ATM Agreement.

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

Solitario did not sell any shares under the ATM program during 2023.

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

Subsequent Events

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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 8. Financial Statements and Supplementary Data