Document_and_Entity_Informatio
Document and Entity Information (USD $) | 12 Months Ended | ||
Dec. 31, 2014 | Mar. 30, 2015 | Jun. 30, 2014 | |
Document And Entity Information | |||
Entity Registrant Name | Solitario Exploration & Royalty Corp. | ||
Entity Central Index Key | 917225 | ||
Document Type | 10-K | ||
Document Period End Date | 31-Dec-14 | ||
Amendment Flag | FALSE | ||
Current Fiscal Year End Date | -19 | ||
Is Entity a Well-known Seasoned Issuer? | No | ||
Is Entity a Voluntary Filer? | No | ||
Is Entity's Reporting Status Current? | Yes | ||
Entity Filer Category | Smaller Reporting Company | ||
Entity Public Float | $47,914,923 | ||
Entity Common Stock, Shares Outstanding | 39,247,689 | ||
Document Fiscal Period Focus | FY | ||
Document Fiscal Year Focus | 2014 |
Consolidated_Balance_Sheets
Consolidated Balance Sheets (USD $) | Dec. 31, 2014 | Dec. 31, 2013 |
Current assets: | ||
Cash and cash equivalents | $869,000 | $2,092,000 |
Investments in marketable equity securities, at fair value | 2,308,000 | 1,577,000 |
Prepaid expenses and other | 40,000 | 115,000 |
Total current assets | 3,217,000 | 3,784,000 |
Mineral properties | 14,660,000 | 12,098,000 |
Investments in marketable equity securities, at fair value | 2,396,000 | |
Equity method investment | 153,000 | |
Other assets | 1,163,000 | 1,069,000 |
Total assets | 19,040,000 | 19,500,000 |
Current liabilities: | ||
Accounts payable | 343,000 | 367,000 |
Current portion long-term debt, net of discount | 4,861,000 | |
Short-term margin loan | 802,000 | |
Other | 84,000 | |
Total current liabilities | 5,204,000 | 1,253,000 |
Long-term debt, net of discount | 3,144,000 | |
Deferred gain on sale of mineral property | 7,000,000 | 7,000,000 |
Warrant liability | 55,000 | 140,000 |
Preferred stock, $0.01 par value, authorized 10,000,000 shares (none issued and outstanding at December 31, 2014 and 2013) | ||
Common stock, $0.01 par value, authorized, 100,000,000 shares (39,247,689 and 37,512,127 , respectively, shares issued and outstanding at December 31, 2014 and 2013) | 393,000 | 375,000 |
Additional paid-in capital | 54,512,000 | 51,963,000 |
Accumulated deficit | -46,563,000 | -44,730,000 |
Accumulated other comprehensive (loss) income | -1,120,000 | 460,000 |
Total Solitario shareholders’ equity | 7,222,000 | 8,068,000 |
Noncontrolling interest | -441,000 | -105,000 |
Total shareholders' equity | 6,781,000 | 7,963,000 |
Total liabilities and shareholders' equity | $19,040,000 | $19,500,000 |
Consolidated_Balance_Sheets_Pa
Consolidated Balance Sheets (Parenthetical) (USD $) | Dec. 31, 2014 | Dec. 31, 2013 |
Preferred stock | ||
Preferred stock, par value | $0.01 | $0.01 |
Preferred stock, shares authorized | 10,000,000 | 10,000,000 |
Preferred stock, shares issued | ||
Common stock | ||
Common stock, par value | $0.01 | $0.01 |
Common stock, shares authorized | 100,000,000 | 100,000,000 |
Common stock, shares issued | 39,247,689 | 37,512,127 |
Common stock, shares outstanding | 39,247,689 | 37,512,127 |
Consolidated_Statements_of_Ope
Consolidated Statements of Operations (USD $) | 12 Months Ended | |
Dec. 31, 2014 | Dec. 31, 2013 | |
Income Statement [Abstract] | ||
Joint venture property payments | $200,000 | $300,000 |
Costs, expenses and other: | ||
Exploration expense | 279,000 | 797,000 |
Depreciation and amortization | 13,000 | 26,000 |
General and administrative | 2,176,000 | 2,244,000 |
Gain on derivative instruments | -39,000 | -90,000 |
Property abandonment and impairment | 20,000 | 13,000 |
Gain on sale of assets | -1,000 | -11,000 |
Interest expense and dividend income (net) | -1,000 | -57,000 |
Total costs, expenses and other | 2,447,000 | 2,922,000 |
Other Income (expense) | ||
Gain on sale of marketable equity securities | 472,000 | 142,000 |
Gain on warrant liability | 85,000 | 998,000 |
Gain on early termination of debt | 313,000 | |
Equity in net loss of equity method investment | -153,000 | -1,012,000 |
Total other income (expense) | 404,000 | 441,000 |
Loss before income tax | -1,843,000 | -2,181,000 |
Income tax benefit | 176,000 | |
Net loss | -1,843,000 | -2,005,000 |
(Income) loss attributable to noncontrolling interest | 10,000 | -47,000 |
Net loss attributable to Solitario shareholders | ($1,833,000) | ($2,052,000) |
Loss per common share attributable to Solitario shareholders: | ||
Basic and diluted | ($0.05) | ($0.06) |
Weighted average shares outstanding: | ||
Basic and diluted | 38,967 | 35,743 |
Consolidated_Statements_of_Com
Consolidated Statements of Comprehensive Loss (USD $) | 12 Months Ended | |
In Thousands, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2013 |
Consolidated Statements Of Comprehensive Loss | ||
Net loss for the period, before other comprehensive loss | ($1,843) | ($2,005) |
Other comprehensive income (loss): | ||
Unrealized loss on marketable equity securities, net of deferred taxes | -1,580 | -3,454 |
Comprehensive loss | -3,423 | -5,459 |
Loss (income) attributable to noncontrolling interests | 10 | -47 |
Comprehensive loss attributable to Solitario shareholders | ($3,413) | ($5,506) |
Consolidated_Statement_of_Shar
Consolidated Statement of Shareholders Equity (USD $) | Common Stock | Additional Paid-In Capital | Retained Earnings / Accumulated Deficit | Other Comprehensive Income / Loss | Noncontrolling Interest | Total |
In Thousands, except Share data | ||||||
Beginning balance, value at Dec. 31, 2012 | $345 | $47,107 | ($42,678) | $3,914 | $529 | $9,217 |
Beginning balance, shares at Dec. 31, 2012 | 34,479,958 | |||||
Issuance of shares and cash to noncontrolling shareholder for future earn-in, value | 4 | 377 | -881 | -500 | ||
Issuance of shares and cash to noncontrolling shareholder for future earn-in, shares | 427,777 | |||||
Noncontrolling interest distribution (net) | -50 | -50 | ||||
Credit for payment to receive Ely shares as well as Augusta debt payment | 1,800 | 250 | 2,050 | |||
Issuance of shares in private placement, value | 25 | 2,035 | 2,060 | |||
Issuance of shares in private placement, shares | 2,451,892 | 2,451,892 | ||||
Exercise of stock options, value | 1 | 183 | 184 | |||
Exercise of stock options, shares | 117,500 | |||||
Stock option expense | 420 | 420 | ||||
Issuance of shares for mineral property, value | 41 | 41 | ||||
Issuance of shares for mineral property, shares | 35,000 | |||||
Net loss | -2,052 | 47 | -2,005 | |||
Net unrealized (loss) on marketable equity securities (net of tax) | -3,454 | -3,454 | ||||
Ending balance, value at Dec. 31, 2013 | 375 | 51,963 | -44,730 | 460 | -105 | 7,963 |
Ending balance, shares at Dec. 31, 2013 | 37,512,127 | |||||
Issuance of shares from restricted stock grant, value | 45 | 45 | ||||
Issuance of shares from restricted stock grant, shares | 50,562 | |||||
Issuance of shares and cash to noncontrolling shareholder for future earn-in, value | 1 | 75 | -326 | -250 | ||
Issuance of shares and cash to noncontrolling shareholder for future earn-in, shares | 50,000 | |||||
Issuance of shares in private placement, value | 16 | 1,614 | 1,630 | |||
Issuance of shares in private placement, shares | 1,600,000 | |||||
Stock option expense | 778 | 778 | ||||
Issuance of shares for mineral property, value | 1 | 37 | 38 | |||
Issuance of shares for mineral property, shares | 35,000 | |||||
Issuance of shares from restricted stock grant, value | 45 | 45 | ||||
Net loss | -1,833 | -10 | -1,843 | |||
Net unrealized (loss) on marketable equity securities (net of tax) | -1,580 | -1,580 | ||||
Ending balance, value at Dec. 31, 2014 | $393 | $54,512 | ($46,563) | ($1,120) | ($441) | $6,781 |
Ending balance, shares at Dec. 31, 2014 | 39,247,689 |
Consolidated_Statements_of_Cas
Consolidated Statements of Cash Flows (USD $) | 12 Months Ended | |
Dec. 31, 2014 | Dec. 31, 2013 | |
Operating activities: | ||
Net loss | ($1,843,000) | ($2,005,000) |
Adjustments to reconcile net loss to net cash used in operating activities: | ||
(Gain) loss on derivative instruments | -39,000 | -90,000 |
Depreciation and amortization | 13,000 | 26,000 |
Loss on equity method investment | 153,000 | 1,012,000 |
Property abandonment and impairment | -20,000 | -13,000 |
Employee stock option expense | 778,000 | 420,000 |
Deferred income taxes | -176,000 | |
(Gain) loss on warrant liability | -85,000 | -998,000 |
(Gain) on asset and equity security sales | -473,000 | -153,000 |
(Gain) on early termination of debt | -313,000 | |
Changes in operating assets and liabilities: | ||
Prepaid expenses and other current assets | 75,000 | 78,000 |
Accounts payable and other current liabilities | -209,000 | -51,000 |
Net cash (used in) operating activities | -1,610,000 | -2,237,000 |
Investing activities: | ||
Additions to mineral properties | -1,960,000 | -2,173,000 |
Additions to other assets | -334,000 | -318,000 |
Sale of derivative instrument, net | 36,000 | 90,000 |
Proceeds from sale of marketable equity securities | 556,000 | 839,000 |
Proceeds from sale of other assets | 11,000 | 79,000 |
Proceeds from sale of mineral property | 4,000,000 | |
Net cash (used in) provided by investing activities | -1,691,000 | 2,517,000 |
Financing activities: | ||
Proceeds from issuance of debt, net | 1,500,000 | 2,000,000 |
Proceeds from issuance of common stock , net | 1,630,000 | 2,060,000 |
Short-term borrowing | 100,000 | 2,300,000 |
Repayment of short-term borrowing | -902,000 | -2,998,000 |
Payment to noncontrolling interest | -250,000 | -550,000 |
Repayment of long-term debt | -2,050,000 | |
Proceeds from exercise of options | 184,000 | |
Noncontrolling interest contribution, net | 250,000 | |
Net cash provided by financing activities | 2,078,000 | 1,196,000 |
Net (decrease) increase in cash and cash equivalents | -1,223,000 | 1,476,000 |
Cash and cash equivalents, beginning of year | 2,092,000 | 616,000 |
Cash and cash equivalents, end of year | 869,000 | 2,092,000 |
Supplemental disclosure of cash flow information: | ||
Cash paid for interest, capitalized to mineral property | 220,000 | 186,000 |
Capitalized non-cash interest | 412,000 | 540,000 |
Capitalized depreciation | 21,000 | 30,000 |
Capitalized property payment included in accounts payable | 150,000 | |
Issuance of stock for mineral property | 38,000 | 41,000 |
Issuance of stock from restricted stock grant | 45,000 | |
Issuance of stock to noncontrolling interest | 381,000 | |
Shares of Ely marketable equity securities received upon payment of Augusta debt | $1,800,000 |
Business_and_Summary_of_Signif
Business and Summary of Significant Accounting Policies | 12 Months Ended |
Dec. 31, 2014 | |
Accounting Policies [Abstract] | |
Business and Summary of Significant Accounting Policies | 1. Business and Summary of Significant Accounting Policies: |
Business and company formation | |
Solitario Exploration & Royalty Corp. (“Solitario”) is a development stage company at December 31, 2014 under Industry Guide 7, as issued by the United States Securities and Exchange Commission (“SEC”), with a focus on the development of the Mt. Hamilton gold project located in Nevada. Solitario was incorporated in the state of Colorado on November 15, 1984 as a wholly-owned subsidiary of Crown Resources Corporation ("Crown"). In July 1994, Solitario became a publicly traded company on the Toronto Stock Exchange (the "TSX") through its Initial Public Offering. Solitario has been actively involved in mineral exploration since 1993. As further explained below in Note 2, “Mineral Properties”, in December 2010 Solitario signed the Limited Liability Company Operating Agreement of Mt. Hamilton LLC (the “MH Agreement”) with DHI Minerals (U.S.) Ltd., (“DHI”) and formed Mt. Hamilton LLC (“MH-LLC”), the owner of the Mt. Hamilton project. DHI is a wholly-owned subsidiary of Ely Gold and Minerals, Inc. (“Ely”). Solitario may develop the Mt. Hamilton project or otherwise enter into an arrangement to monetize its interest in the project. However, Solitario has never developed a mineral property. | |
In addition Solitario has a focus on the acquisition of precious and base metal properties with exploration potential and the development or purchase of royalty interests. Solitario acquires and holds a portfolio of exploration properties for future sale or joint venture or to create a royalty prior to the establishment of proven and probable reserves. Solitario has recorded revenue in the past from the sale of mineral property and joint venture property payments and the sale of a royalty on its Mt. Hamilton property. Revenues from the sale or joint venture of properties have not been a significant source of revenue and would occur, if at all, on an infrequent basis in the future. | |
Basis of Presentation | |
The accompanying financial statements have been prepared assuming Solitario will continue as a going concern. As of December 31, 2014 Solitario has a working capital deficit of $1,987,000. As explained in more detail in Note 4, “Short-term Debt,” Solitario entered into a facility agreement (the “Facility Agreement”) with RMB Australia Holdings Limited (“RMBAH”) and RMB Resources, Inc., a Delaware corporation (“RMBR”) whereby Solitario has borrowed $5,000,000 from RMBAH (with any amounts outstanding collectively being the “RMB Loan”). The RMB loan is due on August 20, 2015. Solitario currently does not have sufficient liquidity to repay the RMB Loan when due raising substantial doubt about its ability to continue as a going concern. Management is currently in discussions to refinance the RMB Loan or raise additional funds from the sale of common shares, additional borrowing or the sale of assets to facilitate the repayment of the RMB Loan. There is no assurance that Solitario will be able to refinance the RMB loan or raise sufficient funds on acceptable terms. The accompanying financial statements do not include any adjustments that might result from the outcome of this uncertainty. Under the terms of the RMB loan, Solitario will be in default if it is unable to repay the RMB loan when it is due on August 20, 2015. Should Solitario be in default, RMBAH has, among other rights, the right to foreclose on its security interest in certain assets of Solitario to satisfy its obligation. | |
Financial reporting | |
The consolidated financial statements include the accounts of Solitario and its wholly-owned subsidiaries, controlled non-wholly-owned subsidiaries and its equity investment in Pedra Branca Mineracao, Ltd (“PBM”), which owns the Pedra Branca project in Brazil. All significant intercompany accounts and transactions have been eliminated in consolidation. The consolidated financial statements are prepared in accordance with accounting principles generally accepted in the United States of America ("generally accepted accounting principles"), and are expressed in US dollars. | |
Revenue recognition | |
Solitario records delay rental payments as revenue in the period received. Any payments received for the sale of property interests are recorded as a reduction of the related property's capitalized cost. Proceeds which exceed the capitalized cost of the property without reserves are recognized as revenue. Payments received on the sale of properties with reserves are recognized as revenue to the extent the proceeds exceed the proportionate basis in the assets sold. Gain on the sale of a mineral property revenue stream is deferred to the extent there is a guarantee for the future revenue stream until such time as the potential funding obligation for the guarantee is reduced or released. | |
Use of estimates | |
The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. Some of the more significant estimates included in the preparation of Solitario's financial statements pertain to: (i) the recoverability of mineral properties, with significant emphasis on Mt. Hamilton and the recoverability of its investment as well as the recoverability of mineral exploration properties and their future exploration potential; (ii) the fair value of Solitario's stock option grants to employees; (iii) the ability of Solitario to realize its deferred tax assets; (iv) the current portion of Solitario's investment in marketable equity securities; (v) the fair value of Solitario’s liability for warrants Solitario granted to RMBAH upon entering into the Facility Agreement | |
In performing its activities, Solitario has incurred certain costs for mineral properties. The recovery of these costs is ultimately dependent upon the sale of mineral property interests or the development of economically recoverable ore reserves and the ability of Solitario to obtain the necessary permits and financing to successfully place the properties into production, and upon future profitable operations, none of which is assured. | |
Cash equivalents | |
Cash equivalents include investments in highly liquid money-market securities with original maturities of three months or less when purchased. As of December 31, 2014 and 2013 Solitario had concentrations of cash and cash equivalents in excess of federally insured amounts and cash in foreign banks, which are not covered under the federal deposit insurance rules for the United States. | |
Mineral properties | |
Solitario expenses all exploration costs incurred on its mineral properties prior to the establishment of proven and probable reserves through the completion of a feasibility study. Initial acquisition costs of its mineral properties are capitalized. Solitario began capitalizing all of its development expenditures on its Mt. Hamilton project, subsequent to the completion of a feasibility study in 2012. Solitario regularly performs evaluations of its investment in mineral properties to assess the recoverability and/or the residual value of its investments in these assets. All long-lived assets are reviewed for impairment whenever events or circumstances change which indicate the carrying amount of an asset may not be recoverable, utilizing established guidelines based upon undiscounted future net cash flows from the asset or upon the determination that certain exploration properties do not have sufficient potential for economic mineralization. | |
Derivative instruments | |
Solitario accounts for its derivative instruments in accordance with ASC 815 "Accounting for Derivative Instruments and Hedging Activities" (“ASC 815”). Solitario has not designated its covered calls as hedging instruments and any changes in the fair market value of the covered calls and its warrants are recognized in the statement of operations in the period of the change. | |
Fair value | |
FASB ASC 820, “Fair Value Measurements and Disclosures” (“ASC 820”) establishes a framework for measuring fair value and requires enhanced disclosures about fair value measurements. ASC 820 clarifies that fair value is an exit price, representing the amount that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants. For certain of Solitario's financial instruments, including cash and cash equivalents, short-term margin loans and accounts payable, the carrying amounts approximate fair value due to their short-term maturities. Solitario's marketable equity securities and the Kinross calls are carried at their estimated fair value based on quoted market prices. See Note 9, “Fair Value of Financial Instruments” below. | |
Marketable equity securities | |
Solitario's investments in marketable equity securities are classified as available-for-sale and are carried at fair value, which is based upon quoted prices of the securities owned. Solitario records investments in marketable equity securities as available-for-sale for investments in publicly traded marketable equity securities for which it does not exercise significant control and where Solitario has no representation on the Board of those companies and exercises no control over the management of those companies. The cost of marketable equity securities sold is determined by the specific identification method. Changes in fair value are recorded in accumulated other comprehensive income within shareholders' equity, unless a decline in fair value is considered other than temporary, in which case the decline is recognized as a loss in the consolidated statements of operations. | |
Foreign exchange | |
The United States dollar is the functional currency for all of Solitario's foreign subsidiaries. Although Solitario's South American exploration activities have been conducted primarily in Brazil, Peru and Mexico, a portion of the payments under the land, leasehold and exploration agreements of Solitario are denominated in United States dollars. Foreign currency gains and losses are included in the results of operations in the period in which they occur. | |
Equity method investments | |
Solitario records its share of income or loss of unconsolidated subsidiaries where it has a significant influence over the unconsolidated subsidiary, under the equity method of accounting, as an increase or decrease in its investment in the unconsolidated subsidiary. Solitario accounts for its investment in Pedra Branca do Mineracao, Ltd. (“PBM”) under the equity method since July 2010, when Anglo Platinum Limited (“Anglo”) earned a 51% interest in PBM. Solitario elected not to record its investment in PBM at fair value after July 2010. See Note 3, “Mineral Properties” below. | |
Income taxes | |
Solitario accounts for income taxes in accordance with ASC 740, “Accounting for Income Taxes.” Under ASC 740, income taxes are provided for the tax effects of transactions reported in the financial statements and consist of taxes currently due plus deferred taxes related to certain income and expenses recognized in different periods for financial and income tax reporting purposes. Deferred tax assets and liabilities represent the future tax return consequences of those differences, which will either be taxable or deductible when the assets and liabilities are recovered or settled. Deferred taxes are also recognized for operating losses and tax credits that are available to offset future taxable income and income taxes, respectively. A valuation allowance is provided if it is more likely than not that some portion or all of the deferred tax assets will not be realized. | |
Accounting for uncertainty in income taxes | |
ASC 740 clarifies the accounting for uncertainty in income taxes recognized in a company's financial statements. ASC 740 prescribes a recognition threshold and measurement attribute for the financial statement recognition and measurement of a tax position taken or expected to be taken in a tax return. ASC 740 also provides guidance on derecognition, classification, interest and penalties, accounting in interim periods, disclosure, and transition. ASC 740 provides that a company's tax position will be considered settled if the taxing authority has completed its examination, the company does not plan to appeal, and it is remote that the taxing authority would reexamine the tax position in the future. These provisions of ASC 740 had no effect on Solitario's financial position or results of operations. See Note 8, “Income Taxes” below. | |
Earnings per share | |
The calculation of basic and diluted loss per share is based on the weighted average number of shares of common stock outstanding during the years ended December 31, 2014 and 2013. Potentially dilutive shares related to outstanding common stock options of 3,748,000 and 3,819,000 for the years ended December 31, 2014 and 2013, respectively, and RMB warrants of 1,624,748 for the years ended December 31, 2014 and 2013 were excluded from the calculation of diluted loss per share because the effects were anti-dilutive. | |
Employee stock compensation and incentive plans | |
Solitario classifies all of its stock options as equity options in accordance with the provisions of ASC 718 “Compensation – Stock Compensation”. See Note 11, “Employee Stock Compensation Plans” below. | |
Recent accounting pronouncements | |
In August 2014, the FASB issued ASU 2014-15, “Presentation of Financial Statements-Going Concern: Disclosure of Uncertainties about an Entity’s Ability to Continue as a Going Concern.” The standard requires an entity’s management to evaluate whether there are conditions or events that raise substantial doubt about the entity’s ability to continue as a going concern within one year after the date that the financial statements are issued. Public entities are required to apply the standard for annual reporting periods ending after December 15, 2016, and interim periods thereafter. Early application is permitted. The adoption of this guidance is not expected to impact the Company’s consolidated financial position, results of operations, or cash flows. If any event occurs in future periods that could affect the Company’s ability to continue as a going concern, the Company will provide appropriate disclosures as required by ASU 2014-15. |
Mineral_Properties
Mineral Properties | 12 Months Ended | ||
Dec. 31, 2014 | |||
Property, Plant and Equipment [Abstract] | |||
Mineral Properties | 2. Mineral Properties: | ||
The following table details Solitario’s investment in Mineral Property: | |||
(in thousands) | December 31, | ||
2014 | 2013 | ||
Development (United States) | |||
Mt. Hamilton | $14,641 | $12,059 | |
Exploration | |||
La Promesa (Peru) | 5 | 5 | |
Norcan (Mexico) | 6 | 6 | |
Aconchi (Mexico) | 5 | 5 | |
Canta Colorado (Mexico) | 3 | 3 | |
Pachuca (Mexico) | - | 20 | |
Total exploration | 19 | 39 | |
Total mineral property | $14,660 | $12,098 | |
Mt. Hamilton | |||
MH-LLC joint venture of the Mt. Hamilton project | |||
In December 2010 Solitario signed the MH Agreement with DHI and formed MH-LLC, the owner of the Mt. Hamilton project. Pursuant to the MH Agreement, the fair value of the DHI contribution was valued at $3,000,000 for its 90% interest and MH-LLC assumed $3,066,000 for the fair value of the Augusta debt, discussed below in Note 7, “Long-term Debt.” | |||
On February 22, 2012, Solitario earned an 80% interest in MH-LLC as a result of the completion of a feasibility study on the Mt. Hamilton project (the “Feasibility Study”) prepared by SRK Consulting (US), Inc. of Lakewood, Colorado (“SRK”). Solitario intends to develop the Mt. Hamilton project. In October 2014, Solitario completed an updated feasibility study on the Mt. Hamilton project (the “Updated Feasibility Study”). | |||
As of December 31, 2014, pursuant to the MH Agreement as amended, Solitario had no further cash or share payments due to DHI. Solitario has annual advance royalty payments due to the underlying leaseholder of $300,000 per year. In addition Solitario has the option of making $5,000,000 in royalty reduction payments whereby Solitario may reduce the current royalty due the underlying leaseholder by paying $3,500,000 at any time prior to commercial production at Mt. Hamilton, to reduce the current royalty from 6.0% to 2.75% and, if that payment is made by Solitario, an additional option to make a further royalty reduction payment of $1,500,000 at any time within one year of commercial production at Mt. Hamilton to reduce the then royalty at Mt. Hamilton from 2.75% to 1.0%. However if Solitario fails to make these payments to the underlying leaseholder, per the MH Agreement, Solitario’s interest in MH-LLC will be reduced from 80% to 49% with a corresponding increase in the DHI’s interest in MH-LLC. | |||
The MH Agreement provides that all costs for development at Mt. Hamilton after completion of the Feasibility Study will be shared by Solitario and DHI pro-rata. Upon completion of the Feasibility Study, DHI has the option of having Solitario contribute DHI’s share of costs through commercial completion as a loan, with such loan, plus interest at 8%, being repaid to Solitario from 80% of DHI’s share of distributions from MH-LLC. During 2012, Solitario loaned DHI $127,000 for its share of costs subsequent to the completion of the Feasibility Study. However, subsequently, DHI repaid Solitario $131,000 for the remaining balance due on the loan from Solitario, including interest, and has no balance due to Solitario as of December 31, 2014 or 2013. | |||
During 2013, MH-LLC distributed $250,000 to its members, Solitario and DHI, in proportion to their interests. Solitario received $200,000 from this distribution which was eliminated in consolidation. | |||
Sandstorm royalty sale | |||
In June 2012, MH-LLC completed the sale of a 2.4% net smelter royalty on its Mt. Hamilton project to Sandstorm for $10 million. MH-LLC received an upfront payment of $6 million upon signing the agreement and received $4 million on January 15, 2013. The Sandstorm royalty agreement provides that in the event Sandstorm does not receive $10 million in royalty proceeds by December 31, 2022, MH-LLC will make up any shortfall. As a result of this guarantee, Solitario deferred the gain on sale, until such time as the potential funding obligation under the guarantee is reduced or eliminated. Solitario reduced mineral property $3,000,000 and recorded a deferred gain as a long-term liability on the sale of the Sandstorm royalty of $7,000,000. | |||
As part of the Sandstorm agreement, MH-LLC has provided Sandstorm with a right of first refusal on any future royalty or gold stream financing for the Mt. Hamilton project. Pursuant to the Sandstorm agreement, Solitario is jointly and severally liable for all obligations of MH-LLC to Sandstorm. | |||
Capitalized costs | |||
Solitario has been capitalizing its development costs incurred at its Mt. Hamilton project subsequent to the completion of the Feasibility Study, in February 2012. The following table details the capitalization during 2014 and 2013: | |||
(in thousands) | Year ended | ||
December 31, | |||
2014 | 2013 | ||
Development expenditures | $ 1,678 | $ 1,854 | |
Capitalized interest | 633 | 726 | |
Property payments | 250 | 174 | |
Capitalized depreciation | 21 | 30 | |
Total capitalized costs | $ 2,582 | $ 2,784 | |
Included in the property payments during 2014 and 2013 are the issuance of 35,000 common shares of Solitario with fair values of $38,000 and $41,000 issued to underlying leaseholders which were recorded as an increase to additional paid-in-capital. Solitario also capitalized $300,000 during each of 2014 and 2013 of advance royalty payments to the underlying leaseholder as long-term other assets. See Note 4, “Other Assets,” below. | |||
Exploration property | |||
Solitario's exploration mineral properties at December 31, 2014 consist of use rights related to exploration stage properties, and the value of such assets is primarily driven by the nature and amount of economic mineral ore believed to be contained, or potentially contained, in such properties. The amounts capitalized as mineral properties include concession and lease or option acquisition costs. Capitalized costs related to a mineral property represent its fair value at the time it was acquired. At December 31, 2014, none of Solitario’s exploration properties have production (are operating) or contain proven or probable reserves. Solitario's exploration mineral properties represent interests in properties that Solitario believes have exploration and development potential. Solitario's mineral use rights generally are enforceable regardless of whether proven and probable reserves have been established. | |||
In addition to its capitalized exploration properties, Solitario has an interest in its Bongará and Mercurio exploration concessions, which are currently subject to joint venture agreements where joint venture partners made payments to Solitario. Solitario records joint venture property payment revenue received in excess of capitalized costs and recorded $200,000 of joint venture property revenue on its Bongará project during 2014 and 2013 and recorded $100,000 of joint venture property revenue on its Mercurio project in Brazil during 2013. At December 31, 2014 and 2013, neither of these properties have any remaining capitalized costs. | |||
Solitario previously sold its mineral interests in its Yanacocha exploration projects and retained a royalty interest. Solitario has no capitalized costs related to its Yanacocha royalty interest. | |||
Pedra Branca | |||
Solitario accounts for its investment in PBM, the owner of the Pedra Branca project under the equity method of accounting. During 2014 and 2013 recorded a reduction of $153,000 and $1,012,000, respectively, in its equity method investment for Solitario’s share of the loss of PBM during 2014 and 2013. During 2014, Solitario’s equity investment in PBM was reduced to zero and Solitario is no longer recognizing its share of losses in PBM in the statement of operations. Solitario’s unrecognized losses related to its 49% interest in PBM at December 31, 2014 were $652,000. During the years ended December 31, 2014 and 2013, PBM had no revenues and reported a net operating loss of approximately $1,643,000 and $2,065,000, respectively. | |||
Discontinued projects | |||
During 2014, Solitario recorded $20,000 of mineral property write-downs related to its Pachuca exploration project in Mexico. During 2013, Solitario recorded $13,000 of mineral property write-downs related to its Cerro Azul and Atico properties in Peru and its Jaripo property in Mexico. | |||
Exploration Expense | |||
The following items comprised exploration expense: | |||
For the year ended | |||
December 31, | |||
(in thousands) | 2014 | 2013 | |
Geologic and field expenses | $197 | $311 | |
Administrative | 82 | 486 | |
Total exploration expense | $279 | $797 |
Marketable_Equity_Securities
Marketable Equity Securities | 12 Months Ended | ||
Dec. 31, 2014 | |||
Marketable Securities [Abstract] | |||
Marketable Equity Securities | 3. Marketable Equity Securities | ||
Investment in Kinross | |||
Solitario has a significant investment in Kinross Gold Corporation (“Kinross”), which consisted of the following at December 31, 2014 and 2013: | |||
(in thousands) | Year ended | ||
December 31, | |||
2014 | 2013 | ||
Shares | 480 | 600 | |
Fair value | |||
Current assets | $1,354 | $1,577 | |
Long term assets | - | $1,051 | |
The current assets represent Solitario's estimate of the portion of marketable equity securities that will be liquidated within one year. Solitario sold the following shares of Kinross during 2014 and 2013: | |||
(in thousands) | Year ended | ||
December 31, | |||
2014 | 2013 | ||
Shares sold | 120 | 70 | |
Proceeds | $556 | $358 | |
Gain on sale | $472 | $308 | |
As of March 25, 2015, Solitario owns 480,000 shares of Kinross common stock which have a value of approximately $1.18 million based upon the market price of $2.46 per Kinross share. Solitario’s investment in Kinross common stock represents a significant concentration of assets, with the inherent risk that entails. Any significant fluctuation in the market value of Kinross common shares could have a material impact on Solitario’s liquidity and capital resources. | |||
Investment in Ely | |||
On November 22, 2013, Solitario subscribed for 13,571,354 shares of Ely common stock for $1,300,000 and, pursuant to a letter agreement between Solitario Ely and DHI (the “Letter Agreement”) whereby, Ely used the funds from the sale of their shares to fully pay off the Augusta Resources, Inc. (“Augusta”) long-term debt. Solitario recorded a gain on early retirement of debt of $313,000 during 2013 as a result of the payoff of the Augusta long-term debt. | |||
During 2013, prior to the subscription of the Ely shares discussed above, Solitario sold 6,303,563 shares of Ely common stock for proceeds of $481,000, recording a loss on sale of marketable equity securities of $166,000. Solitario received 3,333,333 of these shares in connection with the formation of MH-LLC during 2012 and received 2,070,230 of these shares in connection with the May 2013 payment of the Augusta long-term debt discussed below under “Long-term debt.” | |||
As of December 31, 2014 Solitario owns 15,732,274 shares of Ely common stock, representing approximately 19.5% of the outstanding shares of Ely with a fair value of $946,000. We have classified our holdings of Ely common stock as marketable equity shares available-for-sale and gains and losses on our holdings of Ely are recorded in accumulated other comprehensive income in the shareholders’ equity section of our Consolidated Balance Sheet. | |||
The following tables summarize Solitario’s marketable equity securities and accumulated other comprehensive income related to its marketable equity securities: | |||
(in thousands) | December 31, 2014 | December 31, 2013 | |
Marketable equity securities at fair value | $2,308 | $3,973 | |
Cost | 1,869 | 1,954 | |
Accumulated other comprehensive income for | 439 | 2,019 | |
unrealized holding gains | |||
Deferred taxes on accumulated other comprehensive | (1,559) | (1,559) | |
income for unrealized holding gains | |||
Accumulated other comprehensive income | $ (1,120) | $ 460 | |
The following table represents changes in marketable equity securities: | |||
(in thousands) | Year ended | ||
December 31, | |||
2014 | 2013 | ||
Gross cash proceeds | $556 | $839 | |
Cost | 84 | 697 | |
Gross gain on sale included in earnings during the period | 472 | 142 | |
Deferred taxes on gross gain on sale included in earnings | - | -58 | |
Reclassification adjustment to unrealized gain in other | -472 | -84 | |
comprehensive income for net gains included in earnings | |||
Gross unrealized holding loss arising during the period | -1,108 | -4,081 | |
included in other comprehensive loss. | |||
Deferred taxes on unrealized holdings loss included in | 384 | 1,582 | |
other comprehensive loss | |||
Valuation allowance on deferred taxes on unrealized holding losses | -384 | -871 | |
included in other comprehensive loss | |||
Net unrealized holding gain (loss) | -1,108 | -3,370 | |
Other comprehensive income (loss) from marketable equity | ($1,580) | ($3,454) | |
securities |
Other_Assets
Other Assets | 12 Months Ended | ||
Dec. 31, 2014 | |||
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract] | |||
Other Assets | 4. Other Assets: | ||
The following items comprised other assets: | |||
(in thousands) | December 31, | ||
2014 | 2013 | ||
Deferred offering costs RMB Loan | $126 | $322 | |
Accumulated Mt. Hamilton advance royalty payments (1) | 900 | 600 | |
Furniture and Fixtures, net of accumulated depreciation | 63 | 95 | |
Exploration bonds and other assets | 74 | 52 | |
Total other assets | $ 1,163 | $ 1,069 | |
-1 | Total advanced royalty payments at Mt. Hamilton are $2,000,000 as of December 31, 2014. The capitalized advanced royalty payments here exclude advanced royalty payments totaling $1,100,000 incurred by Ely, prior to the formation of MH-LLC and by MH-LLC expensed prior to completion of the Feasibility Study. | ||
In connection with the RMB Loan, Solitario recorded deferred offering costs that are being amortized on a straight-line basis to interest cost over 36 months, the term of the Facility Agreement. See Note 6, “Short-term Debt,” below. | |||
Short_Term_Debt
Short Term Debt | 12 Months Ended | |||
Dec. 31, 2014 | ||||
Short-term Debt, Other Disclosures [Abstract] | ||||
Short Term Debt | 5. Short-term Debt: | |||
RMB Facility Agreement | ||||
On August 10, 2012, Solitario entered into the Facility Agreement with RMBAH, and RMBR whereby Solitario was permitted to borrow up to $5,000,000 from RMBAH (with any amounts outstanding collectively being the “RMB Loan”) at any time during the 24 month period ending on August 21, 2014, (the “Availability Period”). On August 11, 2014 Solitario borrowed $1,500,000 to bring its total borrowing under the RMB Loan to $5,000,000. Solitario may not borrow any additional funds under the Facility Agreement. Solitario recorded $588,000 of deferred offering costs related to the Facility Agreement in long-term assets, which are being amortized over the 36 month life of the Facility Agreement on a straight-line basis. See Note 4, “Other Assets,” above. In connection with the Facility Agreement, Solitario recorded a warrant discount related to the 1,624,748 warrants issued to RMBAH at the time Solitario entered into the Facility Agreement (the “RMB Warrants”) and recorded a debt discount of $650,000 for the fair value of the RMB warrants. The debt discount is being amortized to interest cost over 36 months, the term of the Facility Agreement. See Note 8, “Derivative Instruments,” below. The RMB Loan amounts bear interest at the 90-day LIBOR rate plus 5%, payable in arrears on the last day of each quarterly interest period. The RMB Loan interest rate was 5.23% at December 31, 2014. The RMB Loan may be repaid at any time without penalty. Any amounts repaid may not be redrawn under the Facility Agreement. The RMB Loan is secured by a lien on Solitario’s 80% interest in MH-LLC as well as a general security interest in Solitario’s remaining assets. | ||||
Prior to August 21, 2014, the RMB Loan was classified as long-term debt in the consolidated balance sheet. | ||||
The following table summarizes the RMB Loan: | ||||
RMB | RMB | RMB | ||
(in thousands) | Loan borrowing | Warrant discount | Long-term | |
Debt | ||||
Beginning balance January 1, 2013 | $1,500 | ($573) | 927 | |
Borrowing | 2,000 | - | 2,000 | |
Amortization of discount to interest cost | - | 217 | 217 | |
Ending balance December 31, 2013 | $3,500 | ($356) | $3,144 | |
Borrowing | 1,500 | - | 1,500 | |
Amortization of discount to interest cost | - | 217 | 217 | |
Ending balance December 31, 2014 | $5,000 | ($139) | $4,861 | |
Solitario recorded the following interest cost related to the RMB Loan: | ||||
(in thousands) | Year ended | |||
December 31, | ||||
2014 | 2013 | |||
Interest paid in cash | $ 217 | $ 165 | ||
Amortization of the RMB Warrants discount | 217 | 217 | ||
Amortization of RMB deferred financing costs | 196 | 196 | ||
Total interest expense related to the RMB Loan | $629 | $578 | ||
Solitario capitalized all of its interest incurred during 2013 to mineral property. See Note 3, “Mineral Properties,” above. | ||||
UBS Short-term credit line | ||||
During 2014 and 2013 Solitario had a secured credit line agreement with UBS Bank, USA (“UBS”), which was secured by all of Solitario’s assets held in its UBS brokerage account, consisting primarily of Kinross shares. The UBS secured line of credit carried an interest rate which floated based upon a base rate of 2.25% plus the one-month London Interbank Offered Rate (“LIBOR”) which averaged 0.16% during the period the UBS secured line of credit was outstanding during 2014. Solitario paid its entire balance owing on the UBS secured line of credit during 2014 and the secured line of credit was terminated. | ||||
The following tables summarize Solitario’s short-term debt: | ||||
December 31, | ||||
(in thousands) | 2014 | 2013 | ||
UBS short-term credit line | ||||
Beginning balance | $ 802 | $ 1,500 | ||
Borrowing | 100 | 2,300 | ||
Repayments | -902 | -2,998 | ||
Total short-term margin loans | - | 802 | ||
(in thousands) | Year ended | |||
December 31, | ||||
2014 | 2013 | |||
Interest UBS short-term credit line | $4 | $22 | ||
During 2014 and 2013 Solitario capitalized all of its interest to mineral property. See Note 3, “Mineral Properties,” above. | ||||
Long_Term_Debt
Long Term Debt | 12 Months Ended |
Dec. 31, 2014 | |
Debt Disclosure [Abstract] | |
Long Term Debt | 6. Long-term Debt: |
In connection with the formation of MH-LLC, the Mt. Hamilton properties contributed by DHI to MH-LLC were subject to a security interest granted to Augusta related to Ely’s acquisition of the Mt. Hamilton properties. Pursuant to the MH Agreement, as part of its earn-in, Solitario agreed to make private placement investments totaling $2,500,000 in Ely common stock, all to provide Ely with the funds necessary for Ely to make the loan payments due to Augusta at the time of the formation of MH-LLC. The payments due to Augusta were non-interest bearing. Accordingly, upon formation and the contribution of the mineral properties by DHI to MH-LLC, MH-LLC recorded the discounted fair value of the payments due to Augusta, discounted at 7.5%, which was Solitario’s estimated cost of similar credit as of the formation of MH-LLC. | |
On November 22, 2013, Solitario subscribed for 13,571,354 shares of Ely common stock for $1,300,000 and, pursuant to the Letter Agreement, Ely used the funds from the sale of their shares to fully pay off the Augusta long-term debt. Solitario recorded a gain on early retirement of debt of $313,000 during 2013 as a result of the payoff of the Augusta long-term debt. As of December 31, 2013 Solitario has no remaining balance due or obligations related to the Augusta long-term debt. | |
In April 2013, Ely exercised its right to reduce to $500,000 Solitario’s required subscription of $750,000 for Ely common stock, funds from which Ely was required to pay the June 1, 2013 payment due to Augusta. Ely agreed to pay the remaining $250,000 due to Augusta from its own funds, for a total payment of $750,000 which was done in June 2013. As a result, Solitario received 5,131,150 shares of Ely common stock and recorded the fair value of the Ely stock received as marketable equity securities and an increase in additional paid-in-capital. Ely’s payment of the $250,000 portion of the Augusta debt was recorded as an increase in noncontrolling interest in the equity section of Solitario’s balance sheet. | |
During 2013 Solitario recorded $127,000 for accretion of interest related to the Augusta long-term debt and paid $1,800,000, in cash on the long-term note. All interest accreted on the Augusta long-term debt during 2013 was capitalized to mineral property. See Note 2, “Mineral Properties,” above. |
Income_Taxes
Income Taxes | 12 Months Ended | ||
Dec. 31, 2014 | |||
Income Tax Disclosure [Abstract] | |||
Income Taxes | 7. Income Taxes: | ||
Solitario's income tax benefit consists of the following as allocated between foreign and United States components: | |||
(in thousands) | 2014 | 2013 | |
Current: | |||
United States | $ - | $ 5 | |
Foreign | - | 12 | |
Deferred: | |||
United States | - | -614 | |
Foreign | - | - | |
Operating loss and credit carryovers: | |||
United States | - | 421 | |
Foreign | - | - | |
Income tax benefit | $ - | ($176) | |
Consolidated loss before income taxes includes losses from foreign operations of $262,000 and $1,564,000 in 2014 and 2013, respectively. | |||
See Note 1, “Business and Summary of Significant Accounting Policies” for a detail of the deferred taxes associated with the sale of marketable equity securities and the deferred taxes associated with unrealized gains and losses associated with other comprehensive income related to marketable equity securities. | |||
The net deferred tax assets/liabilities in the December 31, 2014 and 2013 consolidated balance sheets include the following components: | |||
(in thousands) | 2014 | 2013 | |
Deferred tax assets: | |||
Loss carryovers | $11,168 | $9,852 | |
Deferred Gain | 2,376 | 2,335 | |
Stock option compensation expense | 350 | 932 | |
Royalty | 1,387 | 1,363 | |
Earnings in Unconsolidated Subsidiary | 865 | 798 | |
Severance | - | 23 | |
Other | 105 | 107 | |
Valuation allowance | -12,431 | -12,545 | |
Total deferred tax assets | 3,820 | 2,865 | |
Deferred tax liabilities: | |||
Unrealized gain on derivative securities | 238 | 160 | |
MH-LLC investment | 2,305 | 1,168 | |
Exploration costs | 845 | 845 | |
Unrealized gains on marketable equity securities | 152 | 688 | |
Capitalized interest | 277 | - | |
Other | 3 | 4 | |
Total deferred tax liabilities | 3,820 | 2,865 | |
Net deferred tax liabilities | $ - | $ - | |
A reconciliation of expected federal income taxes on income (loss) from operations at statutory rates, with the benefit for income taxes is as follows: | |||
(in thousands) | 2014 | 2013 | |
Expected income tax benefit | ($627) | ($741) | |
Non-deductible foreign stock compensation expense | 850 | 18 | |
Foreign tax rate differences | (101) | 31 | |
State income tax | -146 | 303 | |
Change in valuation allowance | (5) | 233 | |
MH-LLC Investment | 3 | -16 | |
Permanent differences and other | 26 | -4 | |
Income tax benefit | $ - | $(176) | |
During 2014, the valuation allowance was increased primarily as a result of increases in Solitario US and foreign net operating loss carryforwards, for which it was more likely than not that the deferred tax benefit would not be realized. During 2013, the valuation allowance was increased primarily as a result of increases in Solitario foreign net operating loss carryforwards, for which it was more likely than not that the deferred tax benefit would not be realized, as well as a decrease in unrealized gains available to offset the future reversal of deferred tax assets. | |||
At December 31, 2014, Solitario has unused US federal Net Operating Loss ("NOL") carryovers of $4,421,000 which begin expiring in 2031and unused US State NOL carryovers of $5,968,000 which begin expiring in 2030. Solitario has foreign loss carryforwards for which Solitario has provided a full valuation allowance and which expire over various periods from five years to no expiration depending on the foreign jurisdiction. | |||
Solitario adopted the provisions ASC 740, which prescribes a recognition threshold and measurement attribute for the financial statement recognition and measurement of a tax position taken or expected to be taken in a tax return. ASC 740 requires that Solitario recognize in its consolidated financial statements, only those tax positions that are “more-likely-than-not” of being sustained as of the adoption date, based on the technical merits of the position. As a result of the implementation of ASC 740, Solitario performed a comprehensive review of its material tax positions in accordance with recognition and measurement standards established by ASC 740. The provisions of ASC 740 had no effect on Solitario’s financial position, cash flows or results of operations at December 31, 2014 or December 31, 2013, or for the years then ended as Solitario had no unrecognized tax benefits. | |||
Solitario and its subsidiaries are subject to the following material taxing jurisdictions: United States Federal, State of Colorado, Mexico, Peru and Brazil. Solitario’s policy is to recognize interest and penalties related to uncertain tax benefits in income tax expense. Solitario has no accrued interest or penalties related to uncertain tax positions as of December 31, 2014, or December 31, 2013 or for the years then ended. | |||
Derivative_Instruments
Derivative Instruments | 12 Months Ended | |||||
Dec. 31, 2014 | ||||||
Derivative Instruments and Hedging Activities Disclosure [Abstract] | ||||||
Derivative Instruments | 8. Derivative Instruments: | |||||
RMB warrants | ||||||
Pursuant to the Facility Agreement, the Company issued 1,624,748 RMB Warrants to RMBAH as partial consideration for financing services provided in connection with the Facility Agreement. Each RMB Warrant entitles the holder to purchase one share of Solitario common stock at an exercise price of $1.5387 for a term of 36 months, subject to standard anti-dilution adjustments. Solitario recorded a discount to the RMB Loan for the fair value of the RMB Warrants. Solitario is amortizing this discount on a straight-line basis to interest cost over the three-year term of the RMB Loan and as of December 31, 2014 the remaining unamortized warrant discount was $139,000. | ||||||
Solitario has recorded a liability for the fair value of the RMB Warrants based upon a Black-Scholes model and adjusts the fair value of the warrants at each balance sheet date, with changes in value recorded in other income (loss) in the statement of operations. The following tables summarize the RMB Warrants: | ||||||
Black Scholes model | ||||||
Warrant | Life | Stock price | Volatility | Risk- | ||
Liability | (months) | Per share | (%) | Free interest rate | ||
(in thousands) | ||||||
Ending balance December 31, 2012 | $1,138 | 32 | 1.68 | 62 | 0.35 | |
Loss (gain) on warrant liability | -998 | |||||
Ending balance December 31, 2013 | $ 140 | 20 | 0.85 | 55 | 0.38 | |
Loss (gain) on warrant liability | -85 | |||||
Ending balance December 31, 2014 | $ 55 | 8 | 0.92 | 57 | 0.19 | |
Covered call options | ||||||
From time to time Solitario has sold covered call options against its holdings of Kinross. 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. Solitario has not designated its covered calls as hedging instruments as described in ASC 815, “Derivatives and Hedging,” 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 2014 and 2013, Solitario recorded the following liabilities and gain or loss on derivative instruments related to Kinross covered call options: | ||||||
(in thousands) | KGC | KGC | KGC | KGC | KGC | |
February | February | February | May | May | ||
2013 | 2014 | 2014 | 2014 | 2014 | ||
$11 call | $7 call | $8 call | $5 call | $6 call | ||
Shares of Kinross | 100 | 100 | 50 | 30 | 100 | |
Ending liability balance December 31,2012 | $ 3 | $ - | $ - | $ - | $ - | |
Sale of call | - | 55 | 35 | - | - | |
(Gain) on derivative instrument | -3 | -53 | -34 | - | - | |
Ending liability balance December 31,2013 | $ - | $ 2 | $ 1 | $ - | $ - | |
Sale of call | - | 16 | 20 | |||
(Gain) on derivative instrument | - | -2 | -1 | -16 | -20 | |
Ending liability balance December 31,2014 | $ - | $ - | $ - | $ - | $ - | |
The following table provides the location and amount of the fair values of Solitario's derivative instruments presented in the consolidated balance sheet as of December 31, 2014 and 2013: | ||||||
Derivatives | ||||||
(in thousands) | Balance Sheet Location | 31-Dec-14 | 31-Dec-13 | |||
Derivatives not designated as hedging instruments under ASC 815 | ||||||
RMB warrants | Long-term liabilities | $55 | $140 | |||
Kinross calls | Other current liabilities | $ - | $ 3 | |||
Fair_Value_of_Financial_Instru
Fair Value of Financial Instruments | 12 Months Ended | ||||
Dec. 31, 2014 | |||||
Fair Value Disclosures [Abstract] | |||||
Fair Value of Financial Instruments | 9. Fair Value of Financial Instruments: | ||||
For certain of Solitario's financial instruments, including cash and cash equivalents, payables and short-term debt, the carrying amounts approximate fair value due to their short maturities. Solitario's marketable equity securities, including its investment in Kinross common stock, TNR Gold and Ely equity investments are carried at their estimated fair value primarily based on publicly available quoted market prices. | |||||
Solitario applies ASC 820, "Fair Value Measurements." ASC 820 establishes a framework for measuring fair value and requires enhanced disclosures about fair value measurements. ASC 820 clarifies that fair value is an exit price, representing the amount that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants. ASC 820 also requires disclosure about how fair value is determined for assets and liabilities and establishes a hierarchy for which these assets and liabilities must be grouped, based on significant levels of inputs as follows: | |||||
Level 1: Quoted prices in active markets for identical assets or liabilities; | |||||
Level 2: Quoted prices in active markets for similar assets and liabilities and inputs that are observable for the asset or liability; or | |||||
Level 3: Unobservable inputs in which there is little or no market data, which require the reporting entity to develop its own assumptions. | |||||
The determination of where assets and liabilities fall within this hierarchy is based upon the lowest level of input that is significant to the fair value measurement. During the years ended December 31, 2014 and 2013, there were no reclassifications in financial assets or liabilities between Level 1, 2 or 3 categories. | |||||
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, 2014: | |||||
(in thousands) | Level 1 | Level 2 | Level 3 | Total | |
Assets | |||||
Marketable equity securities | $2,308 | $ - | $ - | $2,308 | |
Liabilities | |||||
RMB warrants | - | 55 | - | 55 | |
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, 2013: | |||||
(in thousands) | Level 1 | Level 2 | Level 3 | Total | |
Assets | |||||
Marketable equity securities | $3,973 | $ - | $- | $3,973 | |
Liabilities | |||||
RMB warrants | - | 140 | - | 140 | |
Kinross calls | 3 | 3 | |||
Items measured at fair value on a recurring basis: | |||||
Marketable equity securities: At December 31, 2014 and 2013, the fair value of Solitario’s investment in Kinross, TNR and Ely marketable equity securities is based upon quoted market prices. | |||||
Kinross calls: The fair value of the Kinross calls, which are traded on a public market, is based upon quoted market prices. | |||||
RMB Warrants: The RMB Warrants are not traded on any public exchange. Solitario determines the fair value of the RMB Warrants using a Black-Scholes pricing model, using inputs, including share price, volatility of Solitario common stock and discount rates that include an assessment of performance risk, that are readily available from public markets therefore they are classified as Level 2 inputs as of December 31, 2014 and 2013. | |||||
During the year ended December 31, 2014, Solitario did not change any of the valuation techniques used to measure its financial assets and liabilities at fair value. | |||||
Commitments_and_Contingencies
Commitments and Contingencies | 12 Months Ended |
Dec. 31, 2014 | |
Commitments and contingencies (Notes 2 and 9) | |
Commitments and Contingencies | 10. 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. See Note 2, “Mineral Properties,” above. Solitario estimates its 2015 property rentals and option payments, excluding certain earn-in payments discussed below, for properties we own or operate to be approximately $975,000, which includes $435,000 of mineral property payments at Mt. Hamilton. Assuming that our joint ventures continue in their current status and that we do not appreciably change our property positions on existing properties; approximately $517,000 of these annual payments are paid or are reimbursable to us by our joint venture partners. MH-LLC is required to make an annual advance minimum royalty payment of $300,000 to an underlying royalty holder at Mt. Hamilton. As of December 31, 2014, the total advance minimum royalty payments made to date were $2,000,000 which may be used to offset the total royalty due to the underlying leaseholder, if any, that may due from production at Mt. Hamilton, after the payment of the $300,000 annual minimum royalty payment. In addition, we may be required to make further payments in the future if we elect to exercise our options under those agreements or if we enter into new agreements. | |
Solitario has entered into certain month-to-month office leases for its field offices in Nevada, Peru and Mexico. The total rent expense for these offices during 2014 and 2013 was approximately $15,000 and $72,000, respectively. In addition, Solitario leases office space under a non-cancelable operating lease for the Wheat Ridge, Colorado office which provides for total minimum rent payments through October of 2015 of $30,000. | |
Per the MH Agreement, Solitario, in order to maintain its 80% interest in MH-LLC, is required to make certain option payments to buy down a portion of an existing 6% net smelter royalty to a 1% net smelter royalty by paying $3,500,000 to an underlying royalty holder on or before commercial completion of the Mt. Hamilton project and by paying $1,500,000 to the underlying royalty holder on or before one year after commercial completion of the Mt. Hamilton project. If Solitario chooses not make these royalty buy-down payments, its interest in Mt. Hamilton would be reduced from 80% to 49% and DHI’s interest in Mt. Hamilton would be increased from 20% to 51%. | |
Employee_Stock_Compensation_Pl
Employee Stock Compensation Plans | 12 Months Ended | ||||||
Dec. 31, 2014 | |||||||
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |||||||
Employee Stock Compensation Plans | 11. Employee Stock Compensation Plans: | ||||||
a.) The 2006 Plan | |||||||
On June 27, 2006, Solitario's shareholders approved the 2006 Stock Option Incentive Plan (the "2006 Plan"). Under the terms of the 2006 Plan, the Board of Directors reserved a total of 2,800,000 shares of Solitario common stock for the potential awards to Directors, officers and employees with exercise prices equal to the market price of Solitario's common stock at the date of grant. Solitario classifies its stock options under the 2006 Plan as equity options in accordance with the provisions of ASC 718 “Compensation – Stock Compensation.” | |||||||
b.) 2006 Plan stock option compensation | |||||||
Solitario’s outstanding options from the 2006 Plan on the date of grant have a five-year term, and vest 25% on date of grant and 25% on each of the next three anniversary dates. Solitario recognizes stock option compensation expense on the date of grant for 25% of the grant date fair value, and subsequently, based upon a straight line amortization of the unvested grant date fair value of each of its outstanding options. The following table shows the grant date fair value of Solitario’s options grants during 2014 and 2013 from the 2006 Plan as of the date of grant. | |||||||
Grant date fair value | |||||||
Grant Date | 8/15/14 | ||||||
Option – grant date price (Cdn$) | $1.60 | ||||||
Options granted | 1,990,000 | ||||||
Expected life yrs. | 5 | ||||||
Expected volatility | 66% | ||||||
Risk free interest rate | 1.60% | ||||||
Weighted average fair value | $0.81 | ||||||
Grant date fair value | $1,618,000 | ||||||
Solitario recorded $591,000 and $189,000, respectively, of stock option expense from the 2006 Plan during 2014 and 2013 included in general and administrative expense, for the amortization of grant date fair value with a credit to additional paid-in capital. | |||||||
c.) 2006 Plan Stock option activity | |||||||
During 2014 there were no shares issued from the exercise of options. During the year ended December 31, 2013, options for 117,500 shares were exercised for cash proceeds of $184,000. The following table summarizes the activity for stock options outstanding under the 2006 Plan as of December 31, 2014 and2013: | |||||||
2014 | 2013 | ||||||
Weighted | Weighted | ||||||
Average | Aggregate | Average | Aggregate | ||||
Exercise | Intrinsic | Exercise | Intrinsic | ||||
Options | Price (Cdn$) | value(1) | Options | Price (Cdn)$ | Value(1) | ||
2006 Plan | |||||||
Outstanding, beginning of year | 2,419,000 | $2.25 | 2,598,400 | $2.22 | |||
Granted | 1,990,000 | 1.60 | - | - | |||
Exercised | - | - | -117,500 | 1.55 | |||
Cancelled/expired (2) | -2,061,000 | 2.31 | - | - | |||
Forfeited | - | - | -61,900 | 2.4 | |||
Outstanding, end of year | 2,348,000 | $1.66 | $ - | 2,419,000 | $2.25 | $ - | |
Exercisable, end of year | 814,250 | $1.78 | $ - | 2,336,500 | $2.27 | $ - | |
(1)The intrinsic value at December 31, 2014 and 2013 based upon the quoted market price of Cdn$1.05 and Cdn$0.87, respectively, per share for our common stock on the TSX and an exchange ratio of 0.85993 and 0.93485, respectively, United States dollars per Canadian dollar. | |||||||
(2)On January 28, 2014, holders of option awards from the 2006 Plan voluntarily cancelled awards for 1,797,000 options with an option price of Cdn$2.40 with an expiration date of May 5, 2015 to allow Solitario to have additional financial flexibility. No consideration was given or received by the holders of the options to cancel the awards. | |||||||
d.) The 2013 Plan | |||||||
On June 18, 2013 Solitario’s shareholders approved the 2013 Solitario Exploration and Royalty Corp. Omnibus Stock and Incentive Plan (the “2013 Plan”). Under the terms of the 2013 Plan, a total of 1,750,000 shares of Solitario common stock are reserved for awards to Directors, officers, employees and consultants. Such awards may take the form of stock options, stock appreciation rights, restricted stock, and restricted stock units. The terms and conditions of the awards are pursuant to the 2013 Plan and are granted by the Board of Directors or a committee appointed by the Board of Directors. Solitario classifies its awards from the 2013 Plan as equity awards under the provisions of ASC 718 “Compensation – Stock Compensation.” | |||||||
e.) Stock option compensation | |||||||
Solitario made no grants of options during 2014 and made two grants of options during 2013 from the 2013 Plan which on the date of grant have a five-year term, and vest 25% on date of grant and 25% on each of the next three anniversary dates. Solitario recognizes 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 unvested grant date fair value of each of its outstanding options. The following table shows the grant date fair value of Solitario’s options grants during 2013 from the 2013 Plan as of the date of grant. | |||||||
Grant date fair value | |||||||
Grant Date | 6/18/13 | 10/21/13 | |||||
Option – grant date price | $1.14 | $0.94 | |||||
Options outstanding | 120,000 | 1,280,000 | |||||
Expected life yrs. | 5 | 5 | |||||
Expected volatility | 68% | 67% | |||||
Risk free interest rate | 1.24% | 1.39% | |||||
Weighted average fair value | $0.65 | $0.53 | |||||
Grant date fair value | $78,000 | $674,000 | |||||
Solitario recorded $188,000 and $231,000 of stock option expense from the 2013 Plan during 2014 and 2013, respectively, included in general and administrative expense, for the amortization of grant date fair value with a credit to additional paid-in capital. | |||||||
f.) Stock option activity | |||||||
During 2014 and 2013 no option grants from the 2013 Plan were exercised. During 2014 Solitario issued restricted stock units (RSU’s) from the 2014 Plan for a total of 50,562 shares that vested upon grant and were issued as shares to two employees as part of their severance pay upon the employees’ termination from Solitario. Solitario recorded a credit to additional paid-in-capital of $45,000 on the date of issuance of the shares from the 2013 Plan. The following table summarizes the activity for stock options and RSU’s outstanding under the 2013 Plan as of December 31, 2014 and 2013: | |||||||
2014 | 2013 | ||||||
Weighted | Weighted | ||||||
Average | Aggregate | Average | Aggregate | ||||
RSU’s/ | Exercise | Intrinsic | Exercise | Intrinsic | |||
Options | Price | value(1) | Options | Price | value(1) | ||
2013 Plan | |||||||
Outstanding, beginning of year | 1,400,000 | $0.96 | - | - | |||
Granted | 50,562 | 0.89 | 1,400,000 | 0.96 | |||
Exercised | -50,562 | 0.89 | - | - | |||
Cancelled | - | - | - | - | |||
Forfeited | - | - | - | - | |||
Outstanding, end of year | 1,400,000 | $0.96 | $ - | 1,400,000 | $0.96 | $ - | |
Exercisable, end of year | 700,000 | $0.96 | $ - | 350,000 | $0.96 | $ - | |
(1)The intrinsic value at December 31, 2014 and 2013 based upon the quoted market price of $0.92 per share and $0.85 per share, respectively, for our common stock on the NYSE-MKT. | |||||||
Related_Party_Transactions
Related Party Transactions | 12 Months Ended |
Dec. 31, 2014 | |
Related Party Transactions [Abstract] | |
Related Party Transactions | 12. Related Party Transactions: |
On July 26, 2013, Solitario closed a private placement of 2,451,892 shares of its common stock at a price of $0.84 per share for total proceeds of $2,060,000 (the “Offering”). The Offering was unanimously approved by our Board of Directors and, as part of the Offering; insiders subscribed for and acquired 606,665 shares (the “Insider Shares”) for a total purchase of $510,000. The offer and sale of the Insider Shares was unanimously approved by the Audit Committee of the Board of Directors. All shares in the Offering were offered and sold on the same terms and conditions. |
Segment_Reporting
Segment Reporting | 12 Months Ended | ||||
Dec. 31, 2014 | |||||
Segment Reporting [Abstract] | |||||
Segment Reporting | 13. Segment Reporting | ||||
With the completion of the Feasibility Study on February 22, 2012, Solitario now operates in two segments, (i) mineral exploration and (ii) mining development and operations. Solitario is capitalizing Mt. Hamilton development and operations costs subsequent to February 22, 2012, as detailed above in Note 2, “Mineral properties.” | |||||
Solitario’s Mt. Hamilton project is located in Nevada and all of Solitario's remaining operations are located in Peru, Brazil and Mexico as further described in Note 2, “Mineral Properties” to these consolidated financial statements. Included in the consolidated balance sheet at December 31, 2014 and 2013 are total assets of $70,000 and $412,000, respectively, related to Solitario's foreign operations located in Brazil, Peru and Mexico. Solitario is not aware of any foreign exchange restrictions on its subsidiaries located in foreign countries. During 2014 and 2013, Solitario recorded foreign exchange losses of $2,000 and $21,000, respectively. Solitario's cash accounts in foreign subsidiaries not denominated in United States dollars represent the only significant foreign currency denominated assets. Foreign currency denominated cash accounts totaled $14,000 and $64,000, respectively, at December 31, 2014 and 2013. | |||||
The following summarizes Solitario segment information for the year ended December 31, 2014: | |||||
(in thousands) | Year ended December 31, 2014 | ||||
Mt Hamilton | Exploration | Corporate and Other | Consolidated | ||
Exploration expense | $ - | $ 279 | $ - | $ 279 | |
Interest expense | - | - | - | - | |
Other (income) loss (1) | - | 50 | 1,514 | 1,564 | |
Pre-tax income (loss) | $ - | ($329) | ($1,514) | $ (1,843) | |
Total assets (2) | $16,017 | $ 57 | $2,966 | $19,040 | |
Capital Expenditures (3) | $ 2,915 | $ - | $ - | $ 2,915 | |
(1) Corporate and other includes gain on sale of marketable equity securities of $472 and joint venture property payments of $200. | |||||
(2) Corporate and other total assets include investment in marketable equity securities of $2,308. | |||||
(3) Capital expenditures at Mt. Hamilton include capitalized interest of $633 and capitalized other assets of $320. | |||||
The following summarizes Solitario segment information for the year ended December 31, 2013: | |||||
(in thousands) | Year ended December 31, 2013 | ||||
Mt Hamilton | Exploration | Corporate and Other | Consolidated | ||
Exploration expense | $ - | $ 797 | $ - | $ 797 | |
Interest expense | - | - | - | - | |
Other (income) loss (1) | (287) | 784 | 887 | 1,384 | |
Pre-tax income (loss) | $ 287 | ($1,581) | ($887) | $ (2,181) | |
Total assets (2)(3) | $14,283 | $ 784 | $4,433 | $19,500 | |
Capital Expenditures (4) | $ 3,094 | $ 5 | $ 4 | $ 3,103 | |
(1) Mt. Hamilton other includes gain on early retirement of debt of $313. Corporate and other includes gain on sale of marketable equity securities of $142 and joint venture and property payments of $300. | |||||
(2) Exploration total assets include equity method investment of $153. | |||||
(3) Corporate and other total assets include investment in marketable equity securities of $3,973. | |||||
(4) Capital expenditures at Mt. Hamilton include capitalized interest of $726 and capitalized other assets of $311. | |||||
Business_and_Summary_of_Signif1
Business and Summary of Significant Accounting Policies (Policies) | 12 Months Ended |
Dec. 31, 2014 | |
Accounting Policies [Abstract] | |
Business and Summary of Significant Accounting Policies | Basis of Presentation |
The accompanying financial statements have been prepared assuming Solitario will continue as a going concern. As of December 31, 2014 Solitario has a working capital deficit of $1,987,000. As explained in more detail in Note 4, “Short-term Debt,” Solitario entered into a facility agreement (the “Facility Agreement”) with RMB Australia Holdings Limited (“RMBAH”) and RMB Resources, Inc., a Delaware corporation (“RMBR”) whereby Solitario has borrowed $5,000,000 from RMBAH (with any amounts outstanding collectively being the “RMB Loan”). The RMB loan is due on August 20, 2015. Solitario currently does not have sufficient liquidity to repay the RMB Loan when due raising substantial doubt about its ability to continue as a going concern. Management is currently in discussions to refinance the RMB Loan or raise additional funds from the sale of common shares, additional borrowing or the sale of assets to facilitate the repayment of the RMB Loan. There is no assurance that Solitario will be able to refinance the RMB loan or raise sufficient funds on acceptable terms. The accompanying financial statements do not include any adjustments that might result from the outcome of this uncertainty. Under the terms of the RMB loan, Solitario will be in default if it is unable to repay the RMB loan when it is due on August 20, 2015. Should Solitario be in default, RMBAH has, among other rights, the right to foreclose on its security interest in certain assets of Solitario to satisfy its obligation. | |
Financial reporting | |
The consolidated financial statements include the accounts of Solitario and its wholly-owned subsidiaries, controlled non-wholly-owned subsidiaries and its equity investment in Pedra Branca Mineracao, Ltd (“PBM”), which owns the Pedra Branca project in Brazil. All significant intercompany accounts and transactions have been eliminated in consolidation. The consolidated financial statements are prepared in accordance with accounting principles generally accepted in the United States of America ("generally accepted accounting principles"), and are expressed in US dollars. | |
Revenue recognition | |
Solitario records delay rental payments as revenue in the period received. Any payments received for the sale of property interests are recorded as a reduction of the related property's capitalized cost. Proceeds which exceed the capitalized cost of the property without reserves are recognized as revenue. Payments received on the sale of properties with reserves are recognized as revenue to the extent the proceeds exceed the proportionate basis in the assets sold. Gain on the sale of a mineral property revenue stream is deferred to the extent there is a guarantee for the future revenue stream until such time as the potential funding obligation for the guarantee is reduced or released. | |
Use of estimates | |
The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. Some of the more significant estimates included in the preparation of Solitario's financial statements pertain to: (i) the recoverability of mineral properties, with significant emphasis on Mt. Hamilton and the recoverability of its investment as well as the recoverability of mineral exploration properties and their future exploration potential; (ii) the fair value of Solitario's stock option grants to employees; (iii) the ability of Solitario to realize its deferred tax assets; (iv) the current portion of Solitario's investment in marketable equity securities; (v) the fair value of Solitario’s liability for warrants Solitario granted to RMBAH upon entering into the Facility Agreement | |
In performing its activities, Solitario has incurred certain costs for mineral properties. The recovery of these costs is ultimately dependent upon the sale of mineral property interests or the development of economically recoverable ore reserves and the ability of Solitario to obtain the necessary permits and financing to successfully place the properties into production, and upon future profitable operations, none of which is assured. | |
Cash equivalents | |
Cash equivalents include investments in highly liquid money-market securities with original maturities of three months or less when purchased. As of December 31, 2014 and 2013 Solitario had concentrations of cash and cash equivalents in excess of federally insured amounts and cash in foreign banks, which are not covered under the federal deposit insurance rules for the United States. | |
Mineral properties | |
Solitario expenses all exploration costs incurred on its mineral properties prior to the establishment of proven and probable reserves through the completion of a feasibility study. Initial acquisition costs of its mineral properties are capitalized. Solitario began capitalizing all of its development expenditures on its Mt. Hamilton project, subsequent to the completion of a feasibility study in 2012. Solitario regularly performs evaluations of its investment in mineral properties to assess the recoverability and/or the residual value of its investments in these assets. All long-lived assets are reviewed for impairment whenever events or circumstances change which indicate the carrying amount of an asset may not be recoverable, utilizing established guidelines based upon undiscounted future net cash flows from the asset or upon the determination that certain exploration properties do not have sufficient potential for economic mineralization. | |
Derivative instruments | |
Solitario accounts for its derivative instruments in accordance with ASC 815 "Accounting for Derivative Instruments and Hedging Activities" (“ASC 815”). Solitario has not designated its covered calls as hedging instruments and any changes in the fair market value of the covered calls and its warrants are recognized in the statement of operations in the period of the change. | |
Fair value | |
FASB ASC 820, “Fair Value Measurements and Disclosures” (“ASC 820”) establishes a framework for measuring fair value and requires enhanced disclosures about fair value measurements. ASC 820 clarifies that fair value is an exit price, representing the amount that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants. For certain of Solitario's financial instruments, including cash and cash equivalents, short-term margin loans and accounts payable, the carrying amounts approximate fair value due to their short-term maturities. Solitario's marketable equity securities and the Kinross calls are carried at their estimated fair value based on quoted market prices. See Note 9, “Fair Value of Financial Instruments” below. | |
Marketable equity securities | |
Solitario's investments in marketable equity securities are classified as available-for-sale and are carried at fair value, which is based upon quoted prices of the securities owned. Solitario records investments in marketable equity securities as available-for-sale for investments in publicly traded marketable equity securities for which it does not exercise significant control and where Solitario has no representation on the Board of those companies and exercises no control over the management of those companies. The cost of marketable equity securities sold is determined by the specific identification method. Changes in fair value are recorded in accumulated other comprehensive income within shareholders' equity, unless a decline in fair value is considered other than temporary, in which case the decline is recognized as a loss in the consolidated statements of operations. | |
Foreign exchange | |
The United States dollar is the functional currency for all of Solitario's foreign subsidiaries. Although Solitario's South American exploration activities have been conducted primarily in Brazil, Peru and Mexico, a portion of the payments under the land, leasehold and exploration agreements of Solitario are denominated in United States dollars. Foreign currency gains and losses are included in the results of operations in the period in which they occur. | |
Equity method investments | |
Solitario records its share of income or loss of unconsolidated subsidiaries where it has a significant influence over the unconsolidated subsidiary, under the equity method of accounting, as an increase or decrease in its investment in the unconsolidated subsidiary. Solitario accounts for its investment in Pedra Branca do Mineracao, Ltd. (“PBM”) under the equity method since July 2010, when Anglo Platinum Limited (“Anglo”) earned a 51% interest in PBM. Solitario elected not to record its investment in PBM at fair value after July 2010. See Note 3, “Mineral Properties” below. | |
Income taxes | |
Solitario accounts for income taxes in accordance with ASC 740, “Accounting for Income Taxes.” Under ASC 740, income taxes are provided for the tax effects of transactions reported in the financial statements and consist of taxes currently due plus deferred taxes related to certain income and expenses recognized in different periods for financial and income tax reporting purposes. Deferred tax assets and liabilities represent the future tax return consequences of those differences, which will either be taxable or deductible when the assets and liabilities are recovered or settled. Deferred taxes are also recognized for operating losses and tax credits that are available to offset future taxable income and income taxes, respectively. A valuation allowance is provided if it is more likely than not that some portion or all of the deferred tax assets will not be realized. | |
Accounting for uncertainty in income taxes | |
ASC 740 clarifies the accounting for uncertainty in income taxes recognized in a company's financial statements. ASC 740 prescribes a recognition threshold and measurement attribute for the financial statement recognition and measurement of a tax position taken or expected to be taken in a tax return. ASC 740 also provides guidance on derecognition, classification, interest and penalties, accounting in interim periods, disclosure, and transition. ASC 740 provides that a company's tax position will be considered settled if the taxing authority has completed its examination, the company does not plan to appeal, and it is remote that the taxing authority would reexamine the tax position in the future. These provisions of ASC 740 had no effect on Solitario's financial position or results of operations. See Note 8, “Income Taxes” below. | |
Earnings per share | |
The calculation of basic and diluted loss per share is based on the weighted average number of shares of common stock outstanding during the years ended December 31, 2014 and 2013. Potentially dilutive shares related to outstanding common stock options of 3,748,000 and 3,819,000 for the years ended December 31, 2014 and 2013, respectively, and RMB warrants of 1,624,748 for the years ended December 31, 2014 and 2013 were excluded from the calculation of diluted loss per share because the effects were anti-dilutive. | |
Employee stock compensation and incentive plans | |
Solitario classifies all of its stock options as equity options in accordance with the provisions of ASC 718 “Compensation – Stock Compensation”. See Note 11, “Employee Stock Compensation Plans” below. | |
Recent accounting pronouncements | |
In August 2014, the FASB issued ASU 2014-15, “Presentation of Financial Statements-Going Concern: Disclosure of Uncertainties about an Entity’s Ability to Continue as a Going Concern.” The standard requires an entity’s management to evaluate whether there are conditions or events that raise substantial doubt about the entity’s ability to continue as a going concern within one year after the date that the financial statements are issued. Public entities are required to apply the standard for annual reporting periods ending after December 15, 2016, and interim periods thereafter. Early application is permitted. The adoption of this guidance is not expected to impact the Company’s consolidated financial position, results of operations, or cash flows. If any event occurs in future periods that could affect the Company’s ability to continue as a going concern, the Company will provide appropriate disclosures as required by ASU 2014-15. | |
Mineral_Properties_Tables
Mineral Properties (Tables) | 12 Months Ended | ||
Dec. 31, 2014 | |||
Property, Plant and Equipment [Abstract] | |||
Investment in Mineral Property | (in thousands) | December 31, | |
2014 | 2013 | ||
Development (United States) | |||
Mt. Hamilton | $14,641 | $12,059 | |
Exploration | |||
La Promesa (Peru) | 5 | 5 | |
Norcan (Mexico) | 6 | 6 | |
Aconchi (Mexico) | 5 | 5 | |
Canta Colorado (Mexico) | 3 | 3 | |
Pachuca (Mexico) | - | 20 | |
Total exploration | 19 | 39 | |
Total mineral property | $14,660 | $12,098 | |
Capitalized Development Costs | (in thousands) | Year ended | |
December 31, | |||
2014 | 2013 | ||
Development expenditures | $ 1,678 | $ 1,854 | |
Capitalized interest | 633 | 726 | |
Property payments | 250 | 174 | |
Capitalized depreciation | 21 | 30 | |
Total capitalized costs | $ 2,582 | $ 2,784 | |
Exploration Expense | For the year ended | ||
December 31, | |||
(in thousands) | 2014 | 2013 | |
Geologic and field expenses | $197 | $311 | |
Administrative | 82 | 486 | |
Total exploration expense | $279 | $797 |
Marketable_Equity_Securities_T
Marketable Equity Securities (Tables) | 12 Months Ended | ||
Dec. 31, 2014 | |||
Marketable Securities [Abstract] | |||
Investment in Kinross Gold Corporation | (in thousands) | Year ended | |
December 31, | |||
2014 | 2013 | ||
Shares | 480 | 600 | |
Fair value | |||
Current assets | $1,354 | $1,577 | |
Long term assets | - | $1,051 | |
Kinross Gold Securities Sold | (in thousands) | Year ended | |
December 31, | |||
2014 | 2013 | ||
Shares sold | 120 | 70 | |
Proceeds | $556 | $358 | |
Gain on sale | $472 | $308 | |
Marketable Securities and Accumulated Other Comprehensive Income | (in thousands) | December 31, 2014 | December 31, 2013 |
Marketable equity securities at fair value | $2,308 | $3,973 | |
Cost | 1,869 | 1,954 | |
Accumulated other comprehensive income for | 439 | 2,019 | |
unrealized holding gains | |||
Deferred taxes on accumulated other comprehensive | (1,559) | (1,559) | |
income for unrealized holding gains | |||
Accumulated other comprehensive income | $ (1,120) | $ 460 | |
Changes in Marketable Securities | (in thousands) | Year ended | |
December 31, | |||
2014 | 2013 | ||
Gross cash proceeds | $556 | $839 | |
Cost | 84 | 697 | |
Gross gain on sale included in earnings during the period | 472 | 142 | |
Deferred taxes on gross gain on sale included in earnings | - | -58 | |
Reclassification adjustment to unrealized gain in other | -472 | -84 | |
comprehensive income for net gains included in earnings | |||
Gross unrealized holding loss arising during the period | -1,108 | -4,081 | |
included in other comprehensive loss. | |||
Deferred taxes on unrealized holdings loss included in | 384 | 1,582 | |
other comprehensive loss | |||
Valuation allowance on deferred taxes on unrealized holding losses | -384 | -871 | |
included in other comprehensive loss | |||
Net unrealized holding gain (loss) | -1,108 | -3,370 | |
Other comprehensive income (loss) from marketable equity | ($1,580) | ($3,454) | |
securities |
Other_Assets_Tables
Other Assets (Tables) | 12 Months Ended | ||
Dec. 31, 2014 | |||
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract] | |||
Other Assets | (in thousands) | December 31, | |
2014 | 2013 | ||
Deferred offering costs RMB Loan | $126 | $322 | |
Accumulated Mt. Hamilton advance royalty payments (1) | 900 | 600 | |
Furniture and Fixtures, net of accumulated depreciation | 63 | 95 | |
Exploration bonds and other assets | 74 | 52 | |
Total other assets | $ 1,163 | $ 1,069 |
Short_Term_Debt_Tables
Short Term Debt (Tables) | 12 Months Ended | |||
Dec. 31, 2014 | ||||
Short-term Debt, Other Disclosures [Abstract] | ||||
Summary of Short Term Debt | RMB | RMB | RMB | |
(in thousands) | Loan borrowing | Warrant discount | Long-term | |
Debt | ||||
Beginning balance January 1, 2013 | $1,500 | ($573) | 927 | |
Borrowing | 2,000 | - | 2,000 | |
Amortization of discount to interest cost | - | 217 | 217 | |
Ending balance December 31, 2013 | $3,500 | ($356) | $3,144 | |
Borrowing | 1,500 | - | 1,500 | |
Amortization of discount to interest cost | - | 217 | 217 | |
Ending balance December 31, 2014 | $5,000 | ($139) | $4,861 | |
December 31, | ||||
(in thousands) | 2014 | 2013 | ||
UBS short-term credit line | ||||
Beginning balance | $ 802 | $ 1,500 | ||
Borrowing | 100 | 2,300 | ||
Repayments | -902 | -2,998 | ||
Total short-term margin loans | - | 802 | ||
Short Term Debt Interest | (in thousands) | Year ended | ||
December 31, | ||||
2014 | 2013 | |||
Interest paid in cash | $ 217 | $ 165 | ||
Amortization of the RMB Warrants discount | 217 | 217 | ||
Amortization of RMB deferred financing costs | 196 | 196 | ||
Total interest expense related to the RMB Loan | $629 | $578 | ||
(in thousands) | Year ended | |||
December 31, | ||||
2014 | 2013 | |||
Interest UBS short-term credit line | $4 | $22 |
Income_Taxes_Tables
Income Taxes (Tables) | 12 Months Ended | ||
Dec. 31, 2014 | |||
Income Tax Disclosure [Abstract] | |||
Income Tax Benefit | (in thousands) | 2014 | 2013 |
Current: | |||
United States | $ - | $ 5 | |
Foreign | - | 12 | |
Deferred: | |||
United States | - | -614 | |
Foreign | - | - | |
Operating loss and credit carryovers: | |||
United States | - | 421 | |
Foreign | - | - | |
Income tax benefit | $ - | ($176) | |
Deferred Tax Assets and Liabilities | (in thousands) | 2014 | 2013 |
Deferred tax assets: | |||
Loss carryovers | $11,168 | $9,852 | |
Deferred Gain | 2,376 | 2,335 | |
Stock option compensation expense | 350 | 932 | |
Royalty | 1,387 | 1,363 | |
Earnings in Unconsolidated Subsidiary | 865 | 798 | |
Severance | - | 23 | |
Other | 105 | 107 | |
Valuation allowance | -12,431 | -12,545 | |
Total deferred tax assets | 3,820 | 2,865 | |
Deferred tax liabilities: | |||
Unrealized gain on derivative securities | 238 | 160 | |
MH-LLC investment | 2,305 | 1,168 | |
Exploration costs | 845 | 845 | |
Unrealized gains on marketable equity securities | 152 | 688 | |
Capitalized interest | 277 | - | |
Other | 3 | 4 | |
Total deferred tax liabilities | 3,820 | 2,865 | |
Net deferred tax liabilities | $ - | $ - | |
Reconciliation of IncomeTaxes | (in thousands) | 2014 | 2013 |
Expected income tax benefit | ($627) | ($741) | |
Non-deductible foreign stock compensation expense | 850 | 18 | |
Foreign tax rate differences | (101) | 31 | |
State income tax | -146 | 303 | |
Change in valuation allowance | (5) | 233 | |
MH-LLC Investment | 3 | -16 | |
Permanent differences and other | 26 | -4 | |
Income tax benefit | $ - | $(176) |
Derivative_Instruments_Tables
Derivative Instruments (Tables) | 12 Months Ended | |||||
Dec. 31, 2014 | ||||||
Derivative Instruments and Hedging Activities Disclosure [Abstract] | ||||||
Adjustment of fair values liability | Black Scholes model | |||||
Warrant | Life | Stock price | Volatility | Risk- | ||
Liability | (months) | Per share | (%) | Free interest rate | ||
(in thousands) | ||||||
Ending balance December 31, 2012 | $1,138 | 32 | 1.68 | 62 | 0.35 | |
Loss (gain) on warrant liability | -998 | |||||
Ending balance December 31, 2013 | $ 140 | 20 | 0.85 | 55 | 0.38 | |
Loss (gain) on warrant liability | -85 | |||||
Ending balance December 31, 2014 | $ 55 | 8 | 0.92 | 57 | 0.19 | |
Liabilities on derivative instruments | (in thousands) | KGC | KGC | KGC | KGC | KGC |
February | February | February | May | May | ||
2013 | 2014 | 2014 | 2014 | 2014 | ||
$11 call | $7 call | $8 call | $5 call | $6 call | ||
Shares of Kinross | 100 | 100 | 50 | 30 | 100 | |
Ending liability balance December 31,2012 | $ 3 | $ - | $ - | $ - | $ - | |
Sale of call | - | 55 | 35 | - | - | |
(Gain) on derivative instrument | -3 | -53 | -34 | - | - | |
Ending liability balance December 31,2013 | $ - | $ 2 | $ 1 | $ - | $ - | |
Sale of call | - | 16 | 20 | |||
(Gain) on derivative instrument | - | -2 | -1 | -16 | -20 | |
Ending liability balance December 31,2014 | $ - | $ - | $ - | $ - | $ - | |
Fair value derivative instruments | Derivatives | |||||
(in thousands) | Balance Sheet Location | 31-Dec-14 | 31-Dec-13 | |||
Derivatives not designated as hedging instruments under ASC 815 | ||||||
RMB warrants | Long-term liabilities | $55 | $140 | |||
Kinross calls | Other current liabilities | $ - | $ 3 |
Fair_Value_of_Financial_Instru1
Fair Value of Financial Instruments (Tables) | 12 Months Ended | ||||
Dec. 31, 2014 | |||||
Fair Value Disclosures [Abstract] | |||||
Fair Value Financial Assets and Liabilities 2014 | (in thousands) | Level 1 | Level 2 | Level 3 | Total |
Assets | |||||
Marketable equity securities | $2,308 | $ - | $ - | $2,308 | |
Liabilities | |||||
RMB warrants | - | 55 | - | 55 | |
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, 2013: | |||||
(in thousands) | Level 1 | Level 2 | Level 3 | Total | |
Assets | |||||
Marketable equity securities | $3,973 | $ - | $- | $3,973 | |
Liabilities | |||||
RMB warrants | - | 140 | - | 140 | |
Kinross calls | 3 | 3 |
Employee_Stock_Compensation_Pl1
Employee Stock Compensation Plans (Tables) | 12 Months Ended | ||||||
Dec. 31, 2014 | |||||||
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |||||||
Grant Date Fair Value | Grant Date | 8/15/14 | |||||
Option – grant date price (Cdn$) | $1.60 | ||||||
Options granted | 1,990,000 | ||||||
Expected life yrs. | 5 | ||||||
Expected volatility | 66% | ||||||
Risk free interest rate | 1.60% | ||||||
Weighted average fair value | $0.81 | ||||||
Grant date fair value | $1,618,000 | ||||||
Grant Date | 6/18/13 | 10/21/13 | |||||
Option – grant date price | $1.14 | $0.94 | |||||
Options outstanding | 120,000 | 1,280,000 | |||||
Expected life yrs. | 5 | 5 | |||||
Expected volatility | 68% | 67% | |||||
Risk free interest rate | 1.24% | 1.39% | |||||
Weighted average fair value | $0.65 | $0.53 | |||||
Grant date fair value | $78,000 | $674,000 | |||||
Summary Stock Options | 2014 | 2013 | |||||
Weighted | Weighted | ||||||
Average | Aggregate | Average | Aggregate | ||||
Exercise | Intrinsic | Exercise | Intrinsic | ||||
Options | Price (Cdn$) | value(1) | Options | Price (Cdn)$ | Value(1) | ||
2006 Plan | |||||||
Outstanding, beginning of year | 2,419,000 | $2.25 | 2,598,400 | $2.22 | |||
Granted | 1,990,000 | 1.60 | - | - | |||
Exercised | - | - | -117,500 | 1.55 | |||
Cancelled/expired (2) | -2,061,000 | 2.31 | - | - | |||
Forfeited | - | - | -61,900 | 2.4 | |||
Outstanding, end of year | 2,348,000 | $1.66 | $ - | 2,419,000 | $2.25 | $ - | |
Exercisable, end of year | 814,250 | $1.78 | $ - | 2,336,500 | $2.27 | $ - | |
2014 | 2013 | ||||||
Weighted | Weighted | ||||||
Average | Aggregate | Average | Aggregate | ||||
RSU’s/ | Exercise | Intrinsic | Exercise | Intrinsic | |||
Options | Price | value(1) | Options | Price | value(1) | ||
2013 Plan | |||||||
Outstanding, beginning of year | 1,400,000 | $0.96 | - | - | |||
Granted | 50,562 | 0.89 | 1,400,000 | 0.96 | |||
Exercised | -50,562 | 0.89 | - | - | |||
Cancelled | - | - | - | - | |||
Forfeited | - | - | - | - | |||
Outstanding, end of year | 1,400,000 | $0.96 | $ - | 1,400,000 | $0.96 | $ - | |
Exercisable, end of year | 700,000 | $0.96 | $ - | 350,000 | $0.96 | $ - |
Segment_Reporting_Tables
Segment Reporting (Tables) | 12 Months Ended | ||||
Dec. 31, 2014 | |||||
Segment Reporting [Abstract] | |||||
Segment Reporting | (in thousands) | Year ended December 31, 2014 | |||
Mt Hamilton | Exploration | Corporate and Other | Consolidated | ||
Exploration expense | $ - | $ 279 | $ - | $ 279 | |
Interest expense | - | - | - | - | |
Other (income) loss (1) | - | 50 | 1,514 | 1,564 | |
Pre-tax income (loss) | $ - | ($329) | ($1,514) | $ (1,843) | |
Total assets (2) | $16,017 | $ 57 | $2,966 | $19,040 | |
Capital Expenditures (3) | $ 2,915 | $ - | $ - | $ 2,915 | |
(in thousands) | Year ended December 31, 2013 | ||||
Mt Hamilton | Exploration | Corporate and Other | Consolidated | ||
Exploration expense | $ - | $ 797 | $ - | $ 797 | |
Interest expense | - | - | - | - | |
Other (income) loss (1) | (287) | 784 | 887 | 1,384 | |
Pre-tax income (loss) | $ 287 | ($1,581) | ($887) | $ (2,181) | |
Total assets (2)(3) | $14,283 | $ 784 | $4,433 | $19,500 | |
Capital Expenditures (4) | $ 3,094 | $ 5 | $ 4 | $ 3,103 |
Business_and_Summary_of_Signif2
Business and Summary of Significant Accounting Policies (Details Narrative) (USD $) | 12 Months Ended | |
In Thousands, except Share data, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2013 |
Business And Summary Of Significant Accounting Policies Details Narrative | ||
Working capital deficit | $1,987 | |
Total amount RMBAH borrowing | $5,000 | |
Potentially dilutive shares related to outstanding common stock options | 3,748,000 | 3,748,000 |
Potentially dilutive shares related to RMB warrants | 1,624,748 | 1,624,748 |
Mineral_Properties_Investment_
Mineral Properties - Investment in Mineral Property (Details) (USD $) | 12 Months Ended | |
In Thousands, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2013 |
Mt. Hamilton 2014 | ||
Development (United States) | $14,641 | $12,059 |
Total Mineral Property 2014 | ||
Total | 14,660 | 12,098 |
La Promesa Peru 2014 | ||
Exploration | 5 | 5 |
Total Exploration 2014 | ||
Exploration | 19 | 39 |
Norcan (Mexico) 2013 | ||
Exploration | 6 | 6 |
Pachuca (Mexico) 2014 | ||
Exploration | 20 | |
Aconchi (Mexico) 2013 | ||
Exploration | 5 | 5 |
Canta Colorado (Mexico) 2014 | ||
Exploration | $3 | $3 |
Mineral_Properties_Capitalized
Mineral Properties - Capitalized Development Costs (Details) (USD $) | 12 Months Ended | |
In Thousands, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2013 |
Property, Plant and Equipment [Abstract] | ||
Development expenditures | $1,678 | $1,854 |
Capitalized interest | 633 | 726 |
Property payments | 250 | 174 |
Capitalized depreciation | $21 | $30 |
Mineral_Properties_Exploration
Mineral Properties - Exploration Expense (Details) (USD $) | 12 Months Ended | |
In Thousands, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2013 |
Property, Plant and Equipment [Abstract] | ||
Geologic and field expenses | $197 | $311 |
Administrative | $82 | $486 |
Mineral_Properties_Details_Nar
Mineral Properties (Details Narrative) (USD $) | 6 Months Ended | 12 Months Ended | ||
In Thousands, unless otherwise specified | Jun. 30, 2012 | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 |
Property, Plant and Equipment [Abstract] | ||||
Annual advance royalty payments due to underlying leaseholder | $300 | |||
Optional royalty reduction payment | 5,000 | |||
Loan to affiliate partner | 127 | |||
Loan repayment, including interest, from partner | 131 | |||
Company portion of member distribution | 200 | |||
Sale of net smelter royalty | 10,000 | |||
Reduction to mineral property from net smelter royalty sale | 3,000 | |||
Deferred gain recorded as liability on net smelter royalty sale | 7,000 | 7,000 | 7,000 | |
Advance royalty payment capitalized | 300 | 300 | ||
Unrecognized loss in unconsolidated subsidiary related to 49% interest | 652 | |||
Net operating loss of Pedra Branca (an unconsolidated subsidiary) | $1,643 | $2,065 |
Mineral_Properties_Details_Nar1
Mineral Properties (Details Narrative) (Parenthetical) | Dec. 31, 2014 |
Property, Plant and Equipment [Abstract] | |
Solitario percentage interest in Pedra Branca do Mineracao, Brazil, an unconsolidated subsidiary | 49.00% |
Marketable_Equity_Securities_I
Marketable Equity Securities - Investment in Kinross Gold Corporation (Details) (USD $) | 12 Months Ended | |
Dec. 31, 2014 | Dec. 31, 2013 | |
Marketable Securities [Abstract] | ||
Shares | 480 | 600 |
Fair value | ||
Current assets | $1,354,000 | $1,577,000 |
Long term assets | $1,051,000 |
Marketable_Equity_Securities_K
Marketable Equity Securities - Kinross Gold Securities Sold (Details) (USD $) | 12 Months Ended | |
In Thousands, except Share data, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2013 |
Marketable Securities [Abstract] | ||
Shares sold | 120 | 70 |
Proceeds | $556 | $358 |
Gain on sale | $472 | $308 |
Marketable_Equity_Securities_M
Marketable Equity Securities - Marketable Securities and Accumulated Other Comprehensive Income (Details) (USD $) | Dec. 31, 2014 | Dec. 31, 2013 |
In Thousands, unless otherwise specified | ||
Marketable Securities [Abstract] | ||
Marketable equity securities at fair value | $2,308 | $3,973 |
Cost | 1,869 | 1,954 |
Accumulated other comprehensive income for unrealized holding gains | 439 | 2,019 |
Deferred taxes on accumulated other comprehensive income for unrealized holding gains | -1,559 | -1,559 |
Accumulated other comprehensive income | ($1,120) | $460 |
Marketable_Equity_Securities_C
Marketable Equity Securities - Changes in Marketable Securities (Details) (USD $) | 12 Months Ended | |
Dec. 31, 2014 | Dec. 31, 2013 | |
Marketable Securities [Abstract] | ||
Gross cash proceeds | $556,000 | $839,000 |
Cost | 84,000 | 697,000 |
Deferred taxes on gross gain on sale included in earnings | -58,000 | |
Gross unrealized holding loss arising during the period included in other comprehensive loss. | -1,108,000 | -4,081,000 |
Deferred taxes on unrealized holdings loss included in other comprehensive loss | 384,000 | 1,582,000 |
Valuation allowance on deferred taxes on unrealized holding losses included in other comprehensive loss | -384,000 | -871,000 |
Other comprehensive income (loss) from marketable equity securities | ($1,580,000) | ($3,454,000) |
Marketable_Equity_Securities_D
Marketable Equity Securities (Details Narrative) (USD $) | 12 Months Ended | |||
In Thousands, except Share data, unless otherwise specified | Dec. 31, 2013 | Mar. 25, 2015 | Dec. 31, 2014 | Nov. 22, 2013 |
Marketable Securities [Abstract] | ||||
Value of Kinross shares at $2.46 per share | $1,180 | |||
Amount for subscription of 13,517,354 shares Ely stock | 1,300 | |||
Proceeds from sale of shares of 6,303,563 shares of Ely common stock | 481 | |||
Loss recorded for sale of Ely common stock | 166 | |||
Fair value of shares of Ely common stock | 946 | |||
Total amount of Ely common stock, representing 19.5% of outstanding shares of Ely Gold | 15,732,274 | |||
Fair value of Ely common shares | $1,324 |
Marketable_Equity_Securities_D1
Marketable Equity Securities (Details Narrative) (Parenthetical) (USD $) | 12 Months Ended | ||||
Dec. 31, 2013 | Dec. 31, 2012 | Mar. 25, 2015 | Dec. 31, 2014 | Nov. 22, 2013 | |
Marketable Securities [Abstract] | |||||
Kinross shares, per share value | $2.46 | ||||
Shares subscribed, Ely stock | 13,571,354 | ||||
Shares receved in connection with formation of MH-LLC | 3,333,333 | ||||
Shares received in connection with payment of Augusta long term debt | 2,970,230 | ||||
Ownership of Ely common stock | 19.50% |
Other_Assets_Other_Assets_Deta
Other Assets - Other Assets (Details) (USD $) | Dec. 31, 2014 | Dec. 31, 2013 |
In Thousands, unless otherwise specified | ||
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract] | ||
Deferred offering costs RMB Loan | $126 | $322 |
Accumulated Mt. Hamilton advance royalty payments (1) | 900 | 600 |
Furniture and Fixtures, net of accumulated depreciation | 63 | 95 |
Exploration bonds and other assets | 74 | 52 |
Total other assets | $1,163 | $1,069 |
Summary_of_Short_Term_Debt_Det
Summary of Short Term Debt (Details) (USD $) | 12 Months Ended | |
Dec. 31, 2014 | Dec. 31, 2013 | |
RMB Long Term Debt | ||
Beginning balance | $3,144,000 | $927,000 |
Borrowing | 1,500,000 | 2,000,000 |
Amortization of discount to interest cost | 217,000 | 217,000 |
Repayments | ||
Ending balance | 4,861,000 | 3,144,000 |
RMB Warrant Discount | ||
Beginning balance | -356,000 | -573,000 |
Borrowing | ||
Amortization of discount to interest cost | 217,000 | 217,000 |
Repayments | ||
Ending balance | -139,000 | -356,000 |
RMB Loan Borrowing | ||
Beginning balance | 3,500,000 | 1,500,000 |
Borrowing | 1,500,000 | 2,000,000 |
Amortization of discount to interest cost | ||
Repayments | ||
Ending balance | 5,000,000 | 3,500,000 |
UBS Short Term Credit Line | ||
Beginning balance | 802,000 | 1,500,000 |
Borrowing | 100,000 | 2,300,000 |
Amortization of discount to interest cost | ||
Repayments | -902,000 | -2,998,000 |
Ending balance | $802,000 |
Short_Term_Debt_Interest_Detai
Short Term Debt Interest (Details) (USD $) | 12 Months Ended | |
Dec. 31, 2014 | Dec. 31, 2013 | |
Interest paid in cash | $221,000 | $187,000 |
Amortization of the RMB Warrants discount | 217,000 | 217,000 |
Amortization of RMB deferred financing costs | 196,000 | 196,000 |
Total interest expense | 651,000 | 600,000 |
UBS Interest | ||
Interest paid in cash | 4,000 | 22,000 |
Amortization of the RMB Warrants discount | ||
Amortization of RMB deferred financing costs | ||
Total interest expense | 4,000 | 22,000 |
RMB Interest | ||
Interest paid in cash | 217,000 | 165,000 |
Amortization of the RMB Warrants discount | 217,000 | 217,000 |
Amortization of RMB deferred financing costs | 196,000 | 196,000 |
Total interest expense | $629,000 | $578,000 |
Short_Term_Debt_Details_Narrat
Short Term Debt (Details Narrative) (USD $) | Aug. 20, 2012 |
In Thousands, unless otherwise specified | |
Short Term Debt Details Narrative | |
Amortized deferred offering costs | $588 |
Warrant discount | $650 |
Long_Term_Debt_Details_Narrati
Long Term Debt (Details Narrative) (USD $) | 12 Months Ended | |
In Thousands, except Share data, unless otherwise specified | Dec. 31, 2013 | Jun. 08, 2013 |
Debt Disclosure [Abstract] | ||
Accretion of interest related to long term debt | $127 | |
Cash paid on Augusta long term note | 1,800 | |
Ely portion of $750,000 payment on long term debt | $250 | |
Ely issuance of shares as portion of payment on long term debt | 5,131,150 |
Income_Taxes_Income_Tax_Benefi
Income Taxes - Income Tax Benefit (Details) (USD $) | 12 Months Ended | |
Dec. 31, 2014 | Dec. 31, 2013 | |
Deferred: | ||
United States | ($614,000) | |
Foreign | ||
Current: | ||
United States | 5,000 | |
Foreign | 12,000 | |
Operating loss and credit carryovers: | ||
United States | 421,000 | |
Foreign | ||
Income tax benefit | ($176,000) |
Income_Taxes_Deferred_Tax_Asse
Income Taxes - Deferred Tax Assets and Liabilities (Details) (USD $) | Dec. 31, 2014 | Dec. 31, 2013 |
Deferred tax assets: | ||
Loss carryovers | $11,168,000 | $9,852,000 |
Deferred Gain | 2,376,000 | 2,335,000 |
Stock option compensation expense | 350,000 | 932,000 |
Royalty | 1,387,000 | 1,363,000 |
Earnings in Unconsolidated Subsidiary | 865,000 | 798,000 |
Severance | 23,000 | |
Other | 105,000 | 107,000 |
Valuation allowance | -12,431,000 | -12,545,000 |
Total deferred tax assets | 3,820,000 | 2,865,000 |
Deferred tax liabilities: | ||
Unrealized gain on derivative securities | 238,000 | 160,000 |
MH-LLC investment | 2,305,000 | 1,168,000 |
Exploration costs | 845,000 | 845,000 |
Unrealized gains on marketable equity securities | 152,000 | 688,000 |
Capitalized interest | 277,000 | |
Other | 3,000 | 4,000 |
Total deferred tax liabilities | 3,820,000 | 2,865,000 |
Net deferred tax liabilities |
Income_Taxes_Reconciliation_of
Income Taxes - Reconciliation of IncomeTaxes (Details) (USD $) | 12 Months Ended | |
Dec. 31, 2014 | Dec. 31, 2013 | |
Income Tax Disclosure [Abstract] | ||
Expected income tax benefit | ($627,000) | ($741,000) |
Non-deductible foreign stock compensation expense | 850,000 | 18,000 |
Foreign tax rate differences | -101,000 | 31,000 |
State income tax | -146,000 | 303,000 |
Change in valuation allowance | -5,000 | 233,000 |
MH-LLC Investment | 3,000 | -16,000 |
Permanent differences and other | 26,000 | -4,000 |
Income tax benefit | ($176,000) |
Income_Taxes_Details_Narrative
Income Taxes (Details Narrative) (USD $) | 12 Months Ended | |
In Thousands, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2013 |
Income Tax Disclosure [Abstract] | ||
Consolidated loss before income taxes | $262 | $1,564 |
Federal net operating loss carryover | 4,421 | |
State net operating loss carryover | $5,968 |
Derivative_Instruments_Adjustm
Derivative Instruments - Adjustment of fair values liability (Details) (USD $) | 12 Months Ended | ||
In Thousands, except Per Share data, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |||
Beginning balance, Warrant Liability | $140 | $1,138 | |
Life (in months) | 8 months | 20 months | 32 months |
Beginning balance, Stock price Per Share | $0.85 | $1.68 | |
Volatility (%) | 57.00% | 55.00% | 62.00% |
Beginning balance, Risk-Free interest rate | 38.00% | 35.00% | |
Loss (gain) on warrant liability | -85 | -998 | |
Ending balance, Warrant Liability | $55 | $140 | $1,138 |
Ending balance, Stock price Per Share | $0.92 | $0.85 | $1.68 |
Ending balance, Risk-Free interest rate | 19.00% | 38.00% | 35.00% |
Derivative_Instruments_Liabili
Derivative Instruments - Liabilities on derivative instruments (Details) (USD $) | 12 Months Ended | |
Dec. 31, 2014 | Dec. 31, 2013 | |
Shares of Kinross | ||
Ending liability balance | $3,000 | |
Sale of call | 36,000 | 90,000 |
(Gain) on derivative instrument | -39,000 | -90,000 |
KGC May 2014 $5 Call | ||
Shares of Kinross | 30 | |
Ending liability balance | ||
Sale of call | 16,000 | |
(Gain) on derivative instrument | -16,000 | |
KGC February 2014 $8 Call | ||
Shares of Kinross | 50 | |
Ending liability balance | 1,000 | |
Sale of call | 35,000 | |
(Gain) on derivative instrument | -1,000 | -34,000 |
KGC February 2014 $7 Call | ||
Shares of Kinross | 100 | |
Ending liability balance | 2,000 | |
Sale of call | 55,000 | |
(Gain) on derivative instrument | -2,000 | -53,000 |
KGC February 2013 $11 Call | ||
Shares of Kinross | 100 | |
Ending liability balance | ||
(Gain) on derivative instrument | -3,000 | |
KGC May 2014 $6 Call | ||
Shares of Kinross | 100 | |
Ending liability balance | ||
Sale of call | 20,000 | |
(Gain) on derivative instrument | ($20,000) |
Derivative_Instruments_Fair_va
Derivative Instruments - Fair value derivative instruments (Details) (USD $) | Dec. 31, 2014 | Dec. 31, 2013 |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | ||
RMB warrants (long-term liabilities) | $55,000 | $140,000 |
Kinross calls (other current liabilities) | $3,000 |
Derivative_Instruments_Details
Derivative Instruments (Details Narrative) (USD $) | Dec. 31, 2014 |
In Thousands, unless otherwise specified | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Unamortized warrant discount | $139 |
Fair_Value_of_Financial_Instru2
Fair Value of Financial Instruments - Fair Value Financial Assets and Liabilities (Details) (USD $) | Dec. 31, 2014 | Dec. 31, 2013 |
Assets | ||
Marketable equity securities | $2,308,000 | $3,973,000 |
Liabilities | ||
RMB warrants | 55,000 | 140,000 |
Kinross calls | 3,000 | |
Level 2 | ||
Assets | ||
Marketable equity securities | ||
Liabilities | ||
RMB warrants | 55,000 | 140,000 |
Kinross calls | ||
Level 1 | ||
Assets | ||
Marketable equity securities | 3,973,000 | 2,308,000 |
Liabilities | ||
RMB warrants | ||
Kinross calls | $3,000 |
Commitments_and_Contingencies_
Commitments and Contingencies (Details Narrative) (USD $) | 12 Months Ended | ||
In Thousands, unless otherwise specified | Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 |
Commitments and contingencies (Notes 2 and 9) | |||
Property rentals and option payments | $975 | ||
Property payments Mt. Hamilton | 435 | ||
Property payments reimbursable by joint venture partners | 517 | ||
Advance minimum royalty payment to underlying royalty holder | 300 | ||
Advance minimum royalty payments total | 2,000 | ||
Office rent expense | $15 | $72 |
Employee_Stock_Compensation_Pl2
Employee Stock Compensation Plans - Grant Date Fair Value (Details) (USD $) | 12 Months Ended | |||
Dec. 31, 2014 | Aug. 15, 2015 | Oct. 21, 2013 | Jun. 08, 2013 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | ||||
Option - grant date price | $0.94 | $1.14 | ||
Option b grant date price (Cdn$) | $1.60 | |||
Options granted | 1,990,000 | |||
Expected life yrs. grant date June 18, 2013 | 5 years | |||
Expected life yrs. grant date October 21, 2013 | 5 years | |||
Expected life yrs. grant date August 15, 2014 | 5 years | |||
Expected volatility grant date June 18, 2013 | 68.00% | |||
Expected volatility grant date October 21, 2013 | 67.00% | |||
Expected volatility grant date August 15, 2014 | 66.00% | |||
Risk free interest rate | 1.60% | 1.39% | 1.24% | |
Weighted average fair value | $0.81 | $0.53 | $0.65 | |
Grant date fair value | $1,618 | $674 | $78 |
Employee_Stock_Compensation_Pl3
Employee Stock Compensation Plans - Summary Stock Options (Details) (USD $) | 12 Months Ended | |
Dec. 31, 2014 | Dec. 31, 2013 | |
Options 2006 Plan | ||
Outstanding, beginning of year | 2,419,000 | 2,598,400 |
Granted | 1,990,000 | |
Exercised | 117,500 | |
Cancelled/Expired/Forfeited (2) | 2,061,000 | |
Outstanding, end of year | 2,348,000 | 2,419,000 |
Exercisable, end of year | 814,250 | 2,336,500 |
Options/RSUs 2013 Plan | ||
Outstanding, beginning of year | 1,400,000 | |
Granted | 50,562 | 1,400,000 |
Exercised | 50,562 | |
Cancelled/Expired/Forfeited (2) | ||
Outstanding, end of year | 1,400,000 | 1,400,000 |
Exercisable, end of year | 700,000 | 350,000 |
Weighted Average Exercise Price Cdn 2006 Plan | ||
Outstanding, beginning of year, Per Share | 2.25 | 2.22 |
Granted, Per Share | 1.6 | |
Exercised, Per Share | 1.55 | |
Cancelled/Expired/Forfeited (2), Per Share | 2.31 | |
Outstanding, end of year, Per Share | 1.66 | 2.25 |
Exercisable, end of year, Per Share | 1.78 | 2.27 |
Weighted Average Exercise Price2013Plan | ||
Outstanding, beginning of year, Per Share | 0.96 | |
Granted, Per Share | 0.89 | 0.96 |
Exercised, Per Share | 0.89 | |
Cancelled/Expired/Forfeited (2), Per Share | ||
Outstanding, end of year, Per Share | 0.96 | 0.96 |
Exercisable, end of year, Per Share | 0.96 | 0.96 |
Aggregate Intrinsic Value 2006 Plan | ||
Outstanding, beginning of year, Value | ||
Granted, Value | ||
Exercised, Value | ||
Cancelled/Expired/Forfeited (2), Value | ||
Outstanding, end of year, Value | ||
Exercisable, end of year, Value | ||
Aggregate Intrinsic Value 2013 Plan | ||
Outstanding, beginning of year, Value | ||
Granted, Value | ||
Exercised, Value | ||
Cancelled/Expired/Forfeited (2), Value | ||
Outstanding, end of year, Value | ||
Exercisable, end of year, Value |
Employee_Stock_Compensation_Pl4
Employee Stock Compensation Plans (Details Narrative) (USD $) | 12 Months Ended | |||
In Thousands, except Share data, unless otherwise specified | Dec. 31, 2014 | Jan. 28, 2014 | Jun. 18, 2013 | Jun. 27, 2006 |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | ||||
Total options available for grant under option plans | 1,750 | 2,800 | ||
Options voluntarily cancelled | 1,797 | |||
Restricted stock units issued from 2013 Omnibus Stock and Incentive Plan | 50,562 | |||
Credit to additional paid-in-capital from issuance of restricted stock units | $45 |
Related_Party_Transactions_Det
Related Party Transactions (Details Narrative) (USD $) | 12 Months Ended |
In Thousands, unless otherwise specified | Dec. 31, 2013 |
Related Party Transactions [Abstract] | |
Date of Private Placement | 26-Jul-13 |
Proceeds from private placement of 2,451,892 shares at $0.84 per share | $2,060 |
Proceeds from insider purchase of 606,665 shares | $510 |
Related_Party_Transactions_Det1
Related Party Transactions (Details Narrative) (Parenthetical) (USD $) | 12 Months Ended |
Dec. 31, 2013 | |
Related Party Transactions [Abstract] | |
Shares issued in private placement | 2,451,892 |
Price per share of private placement shares | $0.84 |
Insider portion (shares) of private placement issued | 606,665 |
Segment_Reporting_Segment_Repo
Segment Reporting - Segment Reporting (Details) (USD $) | 12 Months Ended | |
Dec. 31, 2014 | Dec. 31, 2013 | |
Consolidated 2014 | ||
Exploration expense | $279,000 | |
Interest expense | ||
Other (income) loss | 1,564,000 | |
Pre-tax income (loss) | -1,843,000 | |
Total assets | 19,040,000 | |
Capital Expenditures | 2,915,000 | |
Exploration 2014 | ||
Exploration expense | 279,000 | |
Interest expense | ||
Other (income) loss | 50,000 | |
Pre-tax income (loss) | -329,000 | |
Total assets | 57,000 | |
Capital Expenditures | ||
Corporate and Other 2014 | ||
Interest expense | ||
Other (income) loss | 1,514,000 | |
Pre-tax income (loss) | -1,514,000 | |
Total assets | 2,966,000 | |
Capital Expenditures | ||
Mt. Hamilton 2014 | ||
Interest expense | ||
Other (income) loss | ||
Pre-tax income (loss) | ||
Total assets | 16,017,000 | |
Capital Expenditures | 2,915,000 | |
Corporate and Other 2013 | ||
Interest expense | ||
Other (income) loss | 887,000 | |
Pre-tax income (loss) | -887,000 | |
Total assets | 4,433,000 | |
Capital Expenditures | 4,000 | |
Exploration 2013 | ||
Exploration expense | 797,000 | |
Interest expense | ||
Other (income) loss | 784,000 | |
Pre-tax income (loss) | -1,581,000 | |
Total assets | 784,000 | |
Capital Expenditures | 5,000 | |
Consolidated 2013 | ||
Exploration expense | 797,000 | |
Interest expense | ||
Other (income) loss | 1,384,000 | |
Pre-tax income (loss) | -2,181,000 | |
Total assets | 19,500,000 | |
Capital Expenditures | 3,103,000 | |
Mt. Hamilton 2013 | ||
Interest expense | ||
Other (income) loss | -287,000 | |
Pre-tax income (loss) | 287,000 | |
Total assets | 14,283,000 | |
Capital Expenditures | $3,094,000 |
Segment_Reporting_Details_Narr
Segment Reporting (Details Narrative) (USD $) | 12 Months Ended | |
In Thousands, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2013 |
Segment Reporting [Abstract] | ||
Foreign assets included in balance sheet | $70 | $412 |
Foreign exchange losses | 2 | 21 |
Foreign currency denominated cash accounts | $14 | $64 |