Document and Entity Information
Document and Entity Information - USD ($) | 12 Months Ended | |
Dec. 31, 2016 | Mar. 10, 2017 | |
Document And Entity Information | ||
Entity Registrant Name | SOLITARIO EXPLORATION & ROYALTY CORP. | |
Entity Central Index Key | 917,225 | |
Document Type | 10-K | |
Document Period End Date | Dec. 31, 2016 | |
Amendment Flag | false | |
Current Fiscal Year End Date | --12-31 | |
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 | $ 36,005 | |
Entity Common Stock, Shares Outstanding | 38,702,189 | |
Document Fiscal Period Focus | FY | |
Document Fiscal Year Focus | 2,016 |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) $ in Thousands | Dec. 31, 2016 | Dec. 31, 2015 |
Current assets: | ||
Cash and cash equivalents | $ 119 | $ 17,718 |
Short-term investments, at fair value | 15,250 | |
Investments in marketable equity securities, at fair value | 1,339 | 202 |
Prepaid expenses and other | 89 | 70 |
Total current assets | 16,797 | 17,990 |
Mineral properties | 46 | 19 |
Other assets | 771 | 45 |
Total assets | 17,614 | 18,054 |
Current liabilities: | ||
Accounts payable | 124 | 175 |
Other | 2 | 4 |
Total current liabilities | 126 | 179 |
Shareholders’ equity: | ||
Preferred stock, $0.01 par value, authorized 10,000,000 shares (none issued and outstanding at December 31, 2016 and 2015) | ||
Common stock, $0.01 par value, authorized, 100,000,000 shares (38,693,589 and 39,169,189 , respectively, shares issued and outstanding at December 31, 2016 and 2015) | 387 | 392 |
Additional paid-in capital | 55,790 | 55,063 |
Accumulated deficit | (39,401) | (37,691) |
Accumulated other comprehensive income | 712 | 111 |
Total shareholders' equity | 17,488 | 17,875 |
Total liabilities and shareholders' equity | $ 17,614 | $ 18,054 |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parenthetical) - $ / shares | Dec. 31, 2016 | Dec. 31, 2015 |
Preferred stock | ||
Preferred stock, par value | $ 0.01 | $ 0.01 |
Preferred stock, shares authorized | 10,000,000 | 10,000,000 |
Common stock | ||
Common stock, par value | $ 0.01 | $ 0.01 |
Common stock, shares authorized | 100,000,000 | 100,000,000 |
Common stock, shares issued | 38,693,589 | 39,169,189 |
Common stock, shares outstanding | 38,693,589 | 39,169,189 |
Consolidated Statements of Oper
Consolidated Statements of Operations - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2015 | |
Costs, expenses and other | ||
Exploration expense | $ 628 | $ 89 |
Depreciation and amortization | 5 | 11 |
General and administrative | 2,163 | 1,965 |
Gain on derivative instruments | (672) | (84) |
Property abandonment and impairment | 13 | |
Loss (gain) on sale of assets | 14 | (7) |
Interest expense and dividend income (net) | (44) | (12) |
Total costs, expenses and other | 2,107 | 1,962 |
Other (expense) income | ||
Gain (loss) on sale of marketable equity securities | 40 | (969) |
Gain on warrant liability | 4 | 51 |
Total other income (expense) | 44 | (918) |
Loss before income tax | (2,063) | (2,880) |
Income tax benefit (expense) | 353 | (560) |
Loss from continuing operations | (1,710) | (3,440) |
Gain on sale of discontinued operations | 12,309 | |
Net income (loss) | (1,710) | 8,869 |
Loss attributable to noncontrolling interest | 3 | |
Net income (loss) attributable to Solitario shareholders | $ (1,710) | $ 8,872 |
Income (loss) per common share attributable to Solitario shareholders basic and diluted | ||
Continuing operations | $ (0.04) | $ (0.09) |
Discontinued operations | 0.31 | |
Net income (loss) | $ (0.04) | $ 0.23 |
Weighted average shares outstanding | ||
Basic and diluted | 38,906 | 39,287 |
Consolidated Statements of Comp
Consolidated Statements of Comprehensive Income - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2015 | |
Consolidated Statements Of Comprehensive Income | ||
Net income (loss) for the period, before other comprehensive loss | $ (1,710) | $ 8,869 |
Other comprehensive income : | ||
Unrealized gain on marketable equity securities, net of deferred taxes | 601 | 1,231 |
Comprehensive income (loss) | (1,109) | 10,100 |
Loss attributable to noncontrolling interests | 3 | |
Comprehensive income (loss) attributable to Solitario shareholders | $ (1,109) | $ 10,103 |
Consolidated Statement of Share
Consolidated Statement of Shareholders Equity - USD ($) $ in Thousands | Common Stock | Additional Paid-In Capital | Retained Earnings / Accumulated Deficit | Other Comprehensive Income / Loss | Noncontrolling Interest | Total |
Beginning balance, value at Dec. 31, 2014 | $ 393 | $ 54,512 | $ (46,563) | $ (1,120) | $ (441) | $ 6,781 |
Beginning balance, shares at Dec. 31, 2014 | 39,247,689 | |||||
Stock option expense | 566 | 566 | ||||
Issuance of shares for mineral property, value | 51 | 51 | ||||
Issuance of shares for mineral property, shares | 66,500 | |||||
Noncontrolling interest contribution | 188 | 188 | ||||
Sale of MH-LLC | 256 | 256 | ||||
Repurchase of shares for cancellation, value | $ (1) | (66) | $ (67) | |||
Repurchase of shares for cancellation, shares | (145,000) | 145,000 | ||||
Net income (loss) | 8,872 | $ (3) | $ 8,869 | |||
Net unrealized gain on marketable equity securities (net of deferred taxes) | 1,231 | 1,231 | ||||
Ending balance, value at Dec. 31, 2015 | $ 392 | 55,063 | (37,691) | 111 | 17,875 | |
Ending balance, shares at Dec. 31, 2015 | 39,169,189 | |||||
Stock option expense | 970 | 970 | ||||
Repurchase of shares for cancellation, value | $ (5) | (243) | $ (248) | |||
Repurchase of shares for cancellation, shares | (475,600) | 475,600 | ||||
Net income (loss) | (1,710) | $ (1,710) | ||||
Net unrealized gain on marketable equity securities (net of deferred taxes) | 601 | 601 | ||||
Ending balance, value at Dec. 31, 2016 | $ 387 | $ 55,790 | $ (39,401) | $ 712 | $ 17,488 | |
Ending balance, shares at Dec. 31, 2016 | 38,693,589 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2015 | |
Operating activities: | ||
Net income (loss) | $ (1,710) | $ 8,869 |
Adjustments to reconcile net income (loss) to net cash used in operating activities: | ||
Gain on derivative instruments | (672) | (84) |
Depreciation and amortization | 5 | 11 |
Property abandonment and impairment | 13 | |
Employee stock option expense | 970 | 566 |
Deferred income taxes | (353) | 560 |
Gain on warrant liability | (4) | (51) |
(Gain) loss on asset and equity security sales | (26) | 962 |
(Gain) on sale of discontinued operations | (12,309) | |
Changes in operating assets and liabilities: | ||
Prepaid expenses and other current assets | (7) | (53) |
Accounts payable and other current liabilities | (51) | (4) |
Net cash (used in) operating activities from continuing operations | (1,835) | (1,533) |
Net cash (used in ) operating activities from discontinued operations | (190) | |
Net cash (used in) operating activities | (1,835) | (1,723) |
Investing activities: | ||
Purchase of short-term investments (net) | (15,272) | |
Purchase of mineral property | (40) | |
Purchase of marketable equity securities | (304) | |
Proceeds from sale of marketable equity securities | 56 | 809 |
Sale of derivative instrument, net | 45 | 84 |
Additions to other assets | (1) | (8) |
Proceeds from sale of MH-LLC | 24,000 | |
Proceeds from sale of other assets | 7 | |
Net cash provided by (used in) investing activities from continuing operations | (15,516) | 24,892 |
Net cash (used in) investing activities from discontinued operations | (1,059) | |
Net cash provided by (used in) investing activities | (15,516) | 23,833 |
Financing activities: | ||
Repurchase of Solitario common stock for cancellation | (248) | (67) |
Repayment of long-term debt | (5,000) | |
Noncontrolling interest contribution, net | 188 | |
Net cash used in financing activities | (248) | (4,879) |
Net (decrease) increase in cash and cash equivalents | (17,599) | 17,231 |
Cash and cash equivalents, beginning of year | 17,718 | 487 |
Cash and cash equivalents, end of year | 119 | 17,718 |
Supplemental disclosure of cash flow information: | ||
Cash paid for interest, capitalized to mineral property | 228 | |
Capitalized non-cash interest | 265 | |
Capitalized depreciation | 7 | |
Issuance of stock for mineral property | $ 51 |
Business and Summary of Signifi
Business and Summary of Significant Accounting Policies | 12 Months Ended |
Dec. 31, 2016 | |
Accounting Policies [Abstract] | |
Business and Summary of Significant Accounting Policies | 1. Business and Summary of Significant Accounting Policies Sale of Mt. Hamilton LLC On August 25, 2015 Solitario Exploration & Royalty Corp. (“Solitario,” the “Company,” “we,” or “us”), along with DHI Minerals (U.S.) Ltd. (“DHI”), sold their combined interests in the Mt. Hamilton gold project (“Mt. Hamilton”) to Waterton Nevada Splitter, LLC (“Waterton”), for total cash proceeds of US$30 million (the “Transaction”) pursuant to a definitive agreement entered into on June 10, 2015 (the “Agreement”). Solitario sold its 80% interest in Mt. Hamilton LLC (“MH-LLC”), a limited liability company which held 100% of the Mt. Hamilton project assets, and DHI sold its 20% interest in MH-LLC. DHI is a wholly-owned subsidiary of Ely Gold and Minerals, Inc. (“Ely”). Solitario received gross cash proceeds of US$24 million and DHI received gross cash proceeds of US$6 million. Solitario’s costs and fees related to the Transaction, including broker fees and professional service fees, were $439,000. Concurrent with the closing of the Transaction, Solitario paid $5,000,000 plus $7,000 of interest and fees to fully repay the funds Solitario had borrowed pursuant to a facility agreement (the “Facility Agreement”) with RMB Australia Holdings Limited (“RMBAH”) and RMB Resources, Inc., a Delaware corporation (“RMBR”). Certain warrants granted to RMB in connection with the Facility Agreement to acquire 1,624,748 shares of Solitario common stock (the “RMB Warrants”) expired unexercised during 2016. During the year ended December 31 2015 virtually all of the costs associated with MH-LLC and the assets sold were directly related to the development of the Mt. Hamilton project, and were capitalized to mineral property during all periods. Accordingly, separate presentation of discontinued operations would not have resulted in any material change to the results presented in the consolidated statements of operations for the year ended December 31, 2015. The sale of MH-LLC in 2015 is shown as gain on sale of discontinued operations as follows: (in thousands) Year ended December 31, 2015 Proceeds from sale of MH-LLC $24,000 Net assets and liabilities disposed of 9,998 Noncontrolling interest 256 Expenses of sale of MH-LLC 439 Gain on sale of discontinued operations, before tax 13,307 Income tax expense 998 Gain on sale of discontinued operations $12,309 Business and company formation Solitario is an exploration stage company under Industry Guide 7, as issued by the United States Securities and Exchange Commission (“SEC”). 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. Solitario’s primary business is to acquire exploration mineral properties or royalties and/or discover economic deposits on its mineral properties and advance these deposits, either on its own or through joint ventures, up to the development stage. At that point, or sometime prior to that point, Solitario would attempt to sell its mineral properties, pursue their development either on its own, or through a joint venture with a partner that has expertise in mining operations, or create a royalty with a third party that continues to advance the property. In addition to focusing on its mineral exploration properties and the evaluation of mineral properties for acquisition or purchase of royalty interests, Solitario also evaluates potential strategic corporate transactions for the potential acquisition of new precious and base metal properties and assets with exploration potential or business combinations that we determine favorable to Solitario. Solitario has recorded revenue in the past from the sale of mineral property, including the Transaction, 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, although significant when they occur, have not been a consistent annual source of revenue and would only occur in the future, if at all, on an infrequent basis. Financial reporting The consolidated financial statements include the accounts of Solitario and its wholly-owned subsidiaries. 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. There were no delay rental payments in either 2016 or 2015. In May 2014, the Financial Accounting Standards Board (“FASB”) amended its guidance on revenue recognition. The core principle of those accounting standards it that an entity should recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods and services. The standards are effective for revenue recognition by Solitario beginning in January 2018 and adoption is not expected to have a material impact on Solitario’s consolidated financial statements. 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) Solitario’s carrying value of short-term investments; (ii) the recoverability of mineral properties related to its mineral exploration properties and their future exploration potential; (iii) the fair value of stock option grants to employees; (iv) the ability of Solitario to realize its deferred tax assets; (v) Solitario's investment in marketable equity securities; and (vi) the fair value of the Vendetta Mining Corp. (“Vendetta”) warrants Solitario owns. 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, 2016, a portion of Solitario’s cash and cash equivalents are held in brokerage accounts and foreign banks, which are not covered under the Federal Deposit Insurance Corporation (“FDIC”) rules for the United States. Short-term investments As of December 31, 2016, Solitario has $7,510,000 of our current assets in United States Treasury securities (“USTS”) with maturities of 15 days to one year. The USTS are recorded at their fair value, based upon quoted market prices. As of December 31, we have $7,499,000 in separate bank certificates of deposit (“CDs”) each with a maximum value of $250,000, and each of which are covered by Federal Deposit Insurance Corporation insurance to the full face value of the CDs. At December 31, 2016, the CDs have maturities of between twenty days and eighteen months. Solitario’s short-term investments are recorded at their fair value, based upon quoted market prices. The short-term investments are highly liquid and may be sold in their entirety at any time at their quoted market price and are classified as a current asset. 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 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 acquired its investment in Vendetta Mining Corp. units, including the Vendetta Warrants (defined below) during 2016. Solitario has classified the Vendetta Warrants as derivative instruments under ASC 815 and recorded the Vendetta Warrants at their fair value as other assets on the consolidated balance sheet. Changes in fair value of the Vendetta Warrants are recognized in the statement of operations in the period of change as gain or loss on derivative instruments. Solitario has entered into covered calls from time to time on its investment in Kinross marketable equity securities. Solitario has not designated its covered calls as hedging instruments and any changes in the fair value of the covered calls and its warrants are recognized in the statement of operations in the period of the change as gain or loss on derivative instruments. 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 and accounts payable, the carrying amounts approximate fair value due to their short-term maturities. Solitario's short-term investments in USTS and CDs, its marketable equity securities and any covered call options against those marketable equity securities are carried at their estimated fair value based on quoted market prices. Solitario’s investment in the Vendetta Warrants, defined below, is carried at fair value as determined by a Black-Scholes model. See Note 7, “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 directors 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 during 2016 and 2015 have been conducted primarily in Peru 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. Income taxes Solitario accounts for income taxes in accordance with ASC 740, “Accounting for Income Taxes” (“ASC 740”). 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 5, “Income Taxes,” below. Earnings per share The calculation of basic and diluted earnings (loss) per share is based on the weighted average number of shares of common stock outstanding during the years ended December 31, 2016 and 2015. Potentially dilutive shares related to outstanding common stock options of 40,000 for the year ended December 31, 2015, and the RMB Warrants of 1,624,748 for the year ended December 31, 2015 were excluded from the calculation of diluted earnings (loss) per share because the effects were anti-dilutive. There were no similar potentially dilutive securities outstanding at December 31, 2016, and the effects of the potentially dilutive shares outstanding during the year ended December 31, 2016 were excluded from the calculation of diluted earnings 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 9, “Employee Stock Compensation Plans,” below. Recent accounting pronouncements In May 2014, the FASB issued Accounting Standards Update ("ASU") 2014-09, Revenue from Contracts with Customers (Topic 606), In February 2016, the FASB issued ASU 2016-02, “Leases” (“ASU No. 2016-02”), which will require lessees to recognize a right-of-use asset and a lease liability for all leases that are not short-term in nature. For a lessor, the accounting applied is also largely unchanged from previous guidance. The new rules will be effective for Solitario in the first quarter of 2019. Solitario does not anticipate early adoption. Solitario does not expect the adoption of ASU No. 2016-02 to materially change its current accounting methods and therefore it does not expect the adoption to have a material impact on its consolidated financial position or results of operations. In January 2016 the FASB issued ASU No 2016-01, Financial Instruments – Recognition and Measurement of Financial Assets and Financial Liabilities (Topic 825) (“ASU No. 2016-01”) . |
Mineral Properties
Mineral Properties | 12 Months Ended |
Dec. 31, 2016 | |
Extractive Industries [Abstract] | |
Mineral Properties | 2. Mineral Properties The following table details Solitario’s capitalized investment in exploration mineral property: (in thousands) December 31, 2016 2015 Exploration La Promesa (Peru) $ 6 $ 6 Montana Royalty property (US) 40 - Canta Colorado (Peru) - 3 Norcan (Mexico) - 5 Aconchi (Mexico) - 5 Total exploration mineral property $46 $19 Capitalized costs Solitario had been capitalizing its development costs incurred at its Mt. Hamilton project subsequent to the completion of a feasibility study on the Mt. Hamilton project in February 2012. The following table details the capitalization during 2015 up to the date of the Transaction: (in thousands) Year ended December 31, 2015 Development expenditures $692 Capitalized interest 493 Property payments 190 Capitalized depreciation 7 Total capitalized costs $ 1,382 Included in the property payments during 2015 are the issuance of 66,500 common shares of Solitario with fair values of $51,000, issued to underlying leaseholders, which were recorded as an increase to common stock, for the par value of the shares issued and to additional paid-in-capital. Additionally, during 2015, Solitario capitalized interest due to RMBAH under the Facility Agreement, which was paid in full upon completion of the Transaction. Exploration property Solitario's exploration mineral properties at December 31, 2016 and 2015 consist of use rights related to its exploration 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, 2016, 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 exploration concession, which is currently subject to a joint venture agreement where joint venture partners made stand-by joint venture payments to Solitario prior to January 1, 2015. Solitario recorded joint venture property payment revenue received in excess of capitalized costs. Per the joint venture agreement, as of December 31, 2016, no further standby joint-venture payments are due to Solitario on the Bongará project. At December 31, 2016 and 2015, Solitario has no remaining capitalized costs related to its Bongará joint venture. 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. During the year ended December 31, 2016, Solitario acquired certain net smelter royalties on non-producing exploration leases in Montana previously owned by Atna Resources, Ltd. for $40,000. Discontinued projects During 2016, Solitario closed its exploration office in Mexico. Solitario retained a 1% net smelter royalty on its Norcan and Aconchi exploration projects in Mexico. Solitario recorded a mineral property write-down of $10,000 related to the Norcan and Aconchi properties during 2016. During 2016, Solitario abandoned its interest in its Canta Colorado property in Peru and recorded a mineral property write-down expense of $3,000 related to Canta Colorado. In addition, Solitario recorded a loss on other assets in Mexico of $14,000 related to the cessation of its exploration activities in Mexico during 2016. During 2015, Solitario converted its operating interest in Pedra Branca Mineracao, Ltd (“PBM”), which was the owner of the Pedra Branca project in Brazil, to a 1% net smelter royalty in the Pedra Branca project, upon the termination of its interest in PBM. Solitario had no remaining asset value related to its investment in PBM, as it had accounted for its interest in PBM under the equity method of accounting and had recognizing a reduction of its remaining interest in PBM to zero prior to the year ended December 31, 2015. Solitario recorded no mineral property write-down expense during 2015. Exploration Expense The following items comprised exploration expense: For the year ended December 31, (in thousands) 2016 2015 Geologic and field expenses $537 $31 Administrative 91 58 Total exploration expense $628 $89 |
Marketable Equity Securities
Marketable Equity Securities | 12 Months Ended |
Dec. 31, 2016 | |
Notes to Financial Statements | |
Marketable Equity Securities | 3. Marketable Equity Securities On May 2, 2016 Solitario purchased 7,240,000 units of Vendetta for aggregate consideration of $289,000. Each unit included one common share of Vendetta and one purchase warrant which allows the holder to purchase one share of Vendetta common stock at a price of Cdn$0.10 per share for a period of two years (the “Vendetta Warrants”). The purchase price of the units of $289,000 was allocated between the Vendetta common shares and the Vendetta Warrants based upon total fair values on the date of purchase. The Vendetta common stock was allocated a purchase cost of $186,000 and the Vendetta Warrants were allocated a purchase cost of $103,000. As of December 31, 2016, the common shares of Vendetta are carried at their fair value based upon the quoted market price of Vendetta, a publicly traded company on the TSX venture exchange, and included in marketable equity securities. The Vendetta Warrants are carried at their fair value, based upon a Black-Scholes valuation model. During the year ended December 31, 2016, Solitario recorded a gain on derivative instruments of $629,000, related to the Vendetta Warrants; see Note 6, “Derivative Instruments,” below. The following tables summarize Solitario’s marketable equity securities and accumulated other comprehensive income related to its marketable equity securities: (in thousands) December 31, 2016 2015 Marketable equity securities at fair value $1,339 $202 Cost 274 91 Accumulated other comprehensive income for 1,065 111 Deferred taxes on accumulated other comprehensive 353 - Accumulated other comprehensive income $ 712 $ 111 The following table represents changes in marketable equity securities: (in thousands) Year ended 2016 2015 Gross cash proceeds from sales $ 56 $ 809 Cost 16 1,778 Gross gain (loss) on sale included in earnings during the period 40 (969) Deferred taxes on gross gain on sale included in earnings (15) - Reclassification adjustment to unrealized gain in other (25) 969 Gross unrealized holding gain (loss) arising during the period 994 (1,296) Deferred taxes on unrealized holding losses included in other comprehensive (income) loss (368) 1,558 Net unrealized holding gain 626 262 Other comprehensive income from marketable equity $601 $1,231 |
Other Assets
Other Assets | 12 Months Ended |
Dec. 31, 2016 | |
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract] | |
Other Assets | 4. Other Assets: The following items comprised other assets: (in thousands) December 31, 2016 2015 Furniture and fixtures, net of accumulated depreciation $ 32 $ 41 Exploration bonds and other assets 4 4 Vendetta Warrants 735 - Total other assets $771 $ 45 |
Income Taxes
Income Taxes | 12 Months Ended |
Dec. 31, 2016 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | 5. Income Taxes Solitario's income tax expense from continuing operations consists of the following as allocated between foreign and United States components: (in thousands) 2016 2015 Current: Federal $ - $ - State - - Foreign - - Deferred: Federal (309) 662 State (44) (102) Foreign - - Income tax (benefit) expense $ (353) $560 Income tax (benefit) expense is included in the financial statements as follows: (in thousands) 2016 2015 Continuing Operations $ (353) $ 560 Discontinued Operations - 998 Other Comprehensive Income 353 (1,558) Consolidated loss before income taxes includes losses from foreign operations of $154,000 and $98,000 in 2016 and 2015, respectively. As discussed in Note 1, “Business and Summary of Significant Accounting Policies,” during 2015, the Transaction resulted in a $13,307,000 before tax gain reported in discontinued operations. Solitario recorded $998,000 of tax expense in discontinued operations which was net of $3,930,000 tax benefit for the release of valuation allowance. Income taxes have been allocated between discontinued operations and continuing operations in accordance with ASC 740. See Note 3, “Marketable Equity Securities,” for 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, 2016 and 2015 consolidated balance sheets include the following components: (in thousands) 2016 2015 Deferred tax assets: Loss carryovers $8,168 $6,982 Stock option compensation expense - 7 Royalty 1,482 1,482 Unrealized loss on derivative securities - 38 Other 105 105 Valuation allowance (9,118) (8,571) Total deferred tax assets 637 43 Deferred tax liabilities: Unrealized gain on derivative securities 196 - Unrealized gains on marketable equity securities 395 41 Other 46 2 Total deferred tax liabilities 637 43 Net deferred tax liabilities $ - $ - A reconciliation of expected federal income taxes on income (loss) from continuing operations at statutory rates, with the expense for income taxes is as follows: (in thousands) 2016 2015 Expected income tax benefit $(701) $(976) Reversal of disproportionate tax effect in other comprehensive income - 1,558 Equity based compensation 366 575 Foreign tax rate differences 6 3 State income tax (237) (606) True-up of deferred taxes - 267 Tax attributes of disposed subsidiary 1,652 3,941 Previously unrecognized basis in disposed subsidiary (1,884) (4,170) Change in valuation allowance 547 (40) MH-LLC investment - 1 Permanent differences and other (102) 7 Income tax (benefit) expense $ (353) $ 560 During 2016, the valuation allowance was decreased primarily due to the removal of deferred tax assets related to abandoned properties in Mexico. During 2015, the valuation allowance was decreased primarily due to the utilization of loss carryforwards for which no tax benefit was previously realized. During 2016 and 2015, other comprehensive income/(loss) was recognized in the amounts of approximately $954,000 and ($327,000), respectively. In 2016 we recognized an income tax benefit of $353,000 and in 2015 no tax benefit was recorded in other comprehensive income/(loss) as a $111,000 valuation allowance fully offset the attendant tax benefit. At December 31, 2016, Solitario has unused US Federal Net Operating Loss ("NOL") carryovers of $1,658,000 and unused US State NOL carryovers of $3,191,000 which begin expiring in 2034. Solitario has unused Capital Loss carryovers of $11,845,000 for US Federal and US State purposes which begin expiring in 2019. Solitario has foreign loss carryforwards for which Solitario has provided a full valuation allowance and which expire over five years related to its prior exploration in Peru. Solitario adopted 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, 2016 or December 31, 2015, 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 and Peru. Solitario’s United States federal return for years 2013 and forward and our United States state and Peru returns for tax years 2012 and forward are subject to examination. 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, 2016, or December 31, 2015 or for the years then ended. |
Derivative Instruments
Derivative Instruments | 12 Months Ended |
Dec. 31, 2016 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Derivative Instruments | 6. Derivative Instruments: RMB warrants The RMB Warrants, which entitled the holder to purchase a total of 1,624,748 shares of Solitario common stock, expired worthless on August 21, 2016. As of December 31, 2016, Solitario has no liability related to the RMB Warrants. Solitario recorded a $4,000 liability for the RMB Warrants as of December 31, 2015 for the fair value of the RMB Warrants based upon a Black-Scholes model. Solitario recorded a gain on derivative instruments of $4,000 for the year ended December 31, 2016 related to the expiration of the RMB Warrants. 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. As of December 31, 2016, Solitario had two covered calls against its holdings of Kinross common stock, which had a fair value of $2,000. As of December 31 2015, all of the covered calls had expired unexercised and there were no liabilities related to those calls entered during each of the years. Solitario recorded the following gain on derivative instruments: (in thousands) Year ended December 31, 2016 2015 Gain on Kinross calls $ 43 $84 Gain on Vendetta Warrants 629 - $672 $84 The following table provides the location and amount of the fair values of Solitario's derivative instruments presented in the consolidated balance sheets as of December 31, 2016 and 2015: Derivatives (in thousands) Balance Sheet Location 2016 2015 Vendetta warrants Other assets $735 $ - RMB warrants Other current liabilities $ - $ 4 Kinross calls Other current liabilities $ 2 $ - |
Fair Value of Financial Instrum
Fair Value of Financial Instruments | 12 Months Ended |
Dec. 31, 2016 | |
Fair Value Disclosures [Abstract] | |
Fair Value of Financial Instruments | 7. 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 shares of Kinross common stock, Vendetta common stock and TNR Gold Corp (“TNR”) common stock, are carried at their estimated fair value primarily based on publicly available quoted market prices. Solitario applies ASC 820, "Fair Value Measurements" (“ASC 820”). 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 Level 2 Level 3 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, 2016 and 2015, 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, 2016: (in thousands) Level 1 Level 2 Level 3 Total Assets Marketable equity securities $1,339 $ - $ - $1,339 Vendetta Warrants 735 735 Liabilities Kinross calls - 2 - 2 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, 2015: (in thousands) Level 1 Level 2 Level 3 Total Assets Marketable equity securities $202 $ - $ - $202 Liabilities RMB Warrants - 4 - 4 Items measured at fair value on a recurring basis: Marketable equity securities : Vendetta Warrants: RMB Warrants During the year ended December 31, 2016, 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, 2016 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | 8. 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 2017 property rentals and option payments, excluding certain earn-in payments discussed below, for properties we own or operate to be approximately $271,000. Assuming that our joint ventures continue in their current status and that we do not appreciably change our property positions on existing properties, approximately $263,000 of these annual payments are paid or are reimbursable to us by our joint venture partners. 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 leases office space under a non-cancelable operating lease for the Wheat Ridge, Colorado office which provides for total minimum annual rent payments of $38,000 through January of 2019. |
Employee Stock Compensation Pla
Employee Stock Compensation Plans | 12 Months Ended |
Dec. 31, 2016 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Employee Stock Compensation Plans | 9. Employee Stock Compensation Plans: On August 24, 2016, the holders of options to acquire Solitario common stock voluntarily surrendered for cancellation all options previously granted to such persons pursuant to the 2013 Solitario Exploration and Royalty Corp Omnibus Stock and Incentive Plan (the “2013 Plan”) and the 2006 Stock Option Incentive Plan (the “2006 Plan”). Solitario cancelled the options upon surrender. As a result, there are no outstanding options under either the 2006 Plan or the 2013 Plan as of December 31, 2016. Historically, stock option awards at the time of grant had a five year term and vested 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. During the years ended December 31, 2016 and 2015, Solitario recorded $970,000 and $516,000, respectively, of stock option expense for the amortization of the grant date fair value through the date of cancellation and for any unrecognized grant date fair value on the date of cancellation of each of its outstanding options with a credit to additional paid-in-capital. Solitario classifies its stock options under the 2006 Plan and the 2013 Plan as equity options in accordance with the provisions of ASC 718, “Compensation – Stock Compensation.” a.) The 2006 Plan On June 27, 2006, Solitario's shareholders approved the 2006 Plan. Under the terms of the 2006 Plan, the Board of Directors reserved a total of 2,800,000 shares of Solitario common stock for the potential awards to directors, officers and employees with exercise prices equal to the market price of Solitario's common stock at the date of grant. As of June 26, 2016, the 2006 Plan terminated, and in accordance with the terms of the 2006 Plan, no additional awards may be made pursuant to the 2006 Plan. b.) 2006 Plan stock option grants The following table shows the grant date fair value of Solitario’s only option grant during either 2016 or 2015 from the 2006 Plan as of the date of grant. Grant date fair value Grant Date 6/22/16 Option – grant date price (Cdn$) $0.72 Options granted 350,000 Expected life years 5.0 Expected volatility 63% Risk free interest rate 1.0% Weighted average fair value $0.30 Grant date fair value $105,000 e.) 2013 Plan stock option grants The following table shows the grant date fair value of Solitario’s only award during either 2016 or 2015 from the 2013 Plan as of the date of grant. Grant date fair value Grant Date 7/28/16 Option – grant date price $0.72 Options granted 1,699,000 Expected life years 5.0 Expected volatility 63% Risk free interest rate 0.9% Weighted average fair value $0.50 Grant date fair value $850,000 c.) 2006 Plan stock option activity During 2016 and 2015 there were no shares issued from the exercise of options. The following table summarizes the activity for stock options outstanding under the 2006 Plan as of December 31, 2016 and 2015: 2016 2015 Weighted Weighted Average Aggregate Average Aggregate Exercise Intrinsic Exercise Intrinsic Options Price (Cdn$) Value(1) Options Price (Cdn)$ Value(1) 2006 Plan Outstanding, beginning of year 40,000 $1.66 2,348,000 $1.66 Granted 350,000 $0.72 - - Exercised - - - - Cancelled/expired (2) (390,000) $0.82 (2,188,000) 1.66 Forfeited - - (120,000) 1.60 Outstanding, end of year - - $ - 40,000 $1.60 $ - Exercisable, end of year - - $ - 20,000 $1.60 $ - (1)The intrinsic value at December 31, 2015 based upon the quoted market price of Cdn$0.70, respectively, per share for our common stock on the TSX and an exchange ratio of 0.72120, United States dollars per Canadian dollar. There were no options outstanding from the 2006 Plan at December 31, 2016. (2)On August 24, 2016, holders of option awards from the 2006 Plan voluntarily cancelled awards for 350,000 options with an option price of Cdn$.072 with an expiration date of June 21, 2021 and 40,000 options with an option price of Cdn$1.66 with an expiration date of August 14, 2019 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 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 made no grants of awards during 2015 from the 2013 Plan. Options grants from the 2013 Plan 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 and for any unrecognized grant date fair value on the date of cancellation of each of its outstanding options. f.) Stock option activity During 2016 and 2015 no options granted from the 2013 Plan were exercised. The following table summarizes the activity for stock options and RSUs outstanding under the 2013 Plan as of December 31, 2016 and 2015: 2016 2015 Weighted Weighted Average Aggregate Average Aggregate RSUs/ Exercise Intrinsic RSUs/ Exercise Intrinsic Options Price Value(1) Options Price Value(1) 2013 Plan Outstanding, beginning of year - - 1,400,000 $0.96 Granted 1,699,000 $0.72 - - Exercised - - - - Cancelled/expired(2) (1,699,000) 0.94 (1,250,000) 0.94 Forfeited - 1.10 (150,000) 1.10 Outstanding, end of year - - $ - - - $ - Exercisable, end of year - - $ - - - $ - (1)There were no options outstanding from the 2013 Plan at December 31, 2016 and 2015. (2) On August 24, 2016, holders of option awards from the 2013 Plan voluntarily cancelled awards for 1,699,000 options with an option price of $.072 with an expiration date of July 27, 2021 to allow Solitario to have additional financial flexibility. No consideration was given or received by the holders of the options to cancel the awards. |
Share Repurchase Program
Share Repurchase Program | 12 Months Ended |
Dec. 31, 2016 | |
Notes to Financial Statements | |
Share Repurchase Program | 10. Share Repurchase Program On October 28, 2015, Solitario’s Board of Directors approved a share repurchase program that initially authorized Solitario to purchase up to two million shares of its outstanding common stock through December 31, 2016. During 2016, Solitario’s Board of Directors extended the expiration date of the share repurchase program through December 31, 2017. During the years ended December 31, 2016 and 2015, Solitario purchased 475,600 and 145,000 shares of Solitario common stock, respectively, for an aggregate purchase price of $248,000 and $67,000, respectively. As of December 31, 2016, Solitario has purchased a total of 620,600 shares for an aggregate purchase price of $315,000 under the share repurchase program since its inception. |
Business and Summary of Signi18
Business and Summary of Significant Accounting Policies (Policies) | 12 Months Ended |
Dec. 31, 2016 | |
Accounting Policies [Abstract] | |
1. Business and Summary of Significant Accounting Policies | 1. Business and Summary of Significant Accounting Policies Sale of Mt. Hamilton LLC On August 25, 2015 Solitario Exploration & Royalty Corp. (“Solitario,” the “Company,” “we,” or “us”), along with DHI Minerals (U.S.) Ltd. (“DHI”), sold their combined interests in the Mt. Hamilton gold project (“Mt. Hamilton”) to Waterton Nevada Splitter, LLC (“Waterton”), for total cash proceeds of US$30 million (the “Transaction”) pursuant to a definitive agreement entered into on June 10, 2015 (the “Agreement”). Solitario sold its 80% interest in Mt. Hamilton LLC (“MH-LLC”), a limited liability company which held 100% of the Mt. Hamilton project assets, and DHI sold its 20% interest in MH-LLC. DHI is a wholly-owned subsidiary of Ely Gold and Minerals, Inc. (“Ely”). Solitario received gross cash proceeds of US$24 million and DHI received gross cash proceeds of US$6 million. Solitario’s costs and fees related to the Transaction, including broker fees and professional service fees, were $439,000. Concurrent with the closing of the Transaction, Solitario paid $5,000,000 plus $7,000 of interest and fees to fully repay the funds Solitario had borrowed pursuant to a facility agreement (the “Facility Agreement”) with RMB Australia Holdings Limited (“RMBAH”) and RMB Resources, Inc., a Delaware corporation (“RMBR”). Certain warrants granted to RMB in connection with the Facility Agreement to acquire 1,624,748 shares of Solitario common stock (the “RMB Warrants”) expired unexercised during 2016. During the year ended December 31 2015 virtually all of the costs associated with MH-LLC and the assets sold were directly related to the development of the Mt. Hamilton project, and were capitalized to mineral property during all periods. Accordingly, separate presentation of discontinued operations would not have resulted in any material change to the results presented in the consolidated statements of operations for the year ended December 31, 2015. The sale of MH-LLC in 2015 is shown as gain on sale of discontinued operations as follows: (in thousands) Year ended December 31, 2015 Proceeds from sale of MH-LLC $24,000 Net assets and liabilities disposed of 9,998 Noncontrolling interest 256 Expenses of sale of MH-LLC 439 Gain on sale of discontinued operations, before tax 13,307 Income tax expense 998 Gain on sale of discontinued operations $12,309 Business and company formation Solitario is an exploration stage company under Industry Guide 7, as issued by the United States Securities and Exchange Commission (“SEC”). 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. Solitario’s primary business is to acquire exploration mineral properties or royalties and/or discover economic deposits on its mineral properties and advance these deposits, either on its own or through joint ventures, up to the development stage. At that point, or sometime prior to that point, Solitario would attempt to sell its mineral properties, pursue their development either on its own, or through a joint venture with a partner that has expertise in mining operations, or create a royalty with a third party that continues to advance the property. In addition to focusing on its mineral exploration properties and the evaluation of mineral properties for acquisition or purchase of royalty interests, Solitario also evaluates potential strategic corporate transactions for the potential acquisition of new precious and base metal properties and assets with exploration potential or business combinations that we determine favorable to Solitario. Solitario has recorded revenue in the past from the sale of mineral property, including the Transaction, 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, although significant when they occur, have not been a consistent annual source of revenue and would only occur in the future, if at all, on an infrequent basis. Financial reporting The consolidated financial statements include the accounts of Solitario and its wholly-owned subsidiaries. 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. There were no delay rental payments in either 2016 or 2015. In May 2014, the Financial Accounting Standards Board (“FASB”) amended its guidance on revenue recognition. The core principle of those accounting standards it that an entity should recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods and services. The standards are effective for revenue recognition by Solitario beginning in January 2018 and adoption is not expected to have a material impact on Solitario’s consolidated financial statements. 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) Solitario’s carrying value of short-term investments; (ii) the recoverability of mineral properties related to its mineral exploration properties and their future exploration potential; (iii) the fair value of stock option grants to employees; (iv) the ability of Solitario to realize its deferred tax assets; (v) Solitario's investment in marketable equity securities; and (vi) the fair value of the Vendetta Mining Corp. (“Vendetta”) warrants Solitario owns. 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, 2016, a portion of Solitario’s cash and cash equivalents are held in brokerage accounts and foreign banks, which are not covered under the Federal Deposit Insurance Corporation (“FDIC”) rules for the United States. Short-term investments As of December 31, 2016, Solitario has $7,510,000 of our current assets in United States Treasury securities (“USTS”) with maturities of 15 days to one year. The USTS are recorded at their fair value, based upon quoted market prices. As of December 31, we have $7,499,000 in separate bank certificates of deposit (“CDs”) each with a maximum value of $250,000, and each of which are covered by Federal Deposit Insurance Corporation insurance to the full face value of the CDs. At December 31, 2016, the CDs have maturities of between twenty days and eighteen months. Solitario’s short-term investments are recorded at their fair value, based upon quoted market prices. The short-term investments are highly liquid and may be sold in their entirety at any time at their quoted market price and are classified as a current asset. 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 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 acquired its investment in Vendetta Mining Corp. units, including the Vendetta Warrants (defined below) during 2016. Solitario has classified the Vendetta Warrants as derivative instruments under ASC 815 and recorded the Vendetta Warrants at their fair value as other assets on the consolidated balance sheet. Changes in fair value of the Vendetta Warrants are recognized in the statement of operations in the period of change as gain or loss on derivative instruments. Solitario has entered into covered calls from time to time on its investment in Kinross marketable equity securities. Solitario has not designated its covered calls as hedging instruments and any changes in the fair value of the covered calls and its warrants are recognized in the statement of operations in the period of the change as gain or loss on derivative instruments. 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 and accounts payable, the carrying amounts approximate fair value due to their short-term maturities. Solitario's short-term investments in USTS and CDs, its marketable equity securities and any covered call options against those marketable equity securities are carried at their estimated fair value based on quoted market prices. Solitario’s investment in the Vendetta Warrants, defined below, is carried at fair value as determined by a Black-Scholes model. See Note 7, “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 directors 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 during 2016 and 2015 have been conducted primarily in Peru 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. Income taxes Solitario accounts for income taxes in accordance with ASC 740, “Accounting for Income Taxes” (“ASC 740”). 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 5, “Income Taxes,” below. Earnings per share The calculation of basic and diluted earnings (loss) per share is based on the weighted average number of shares of common stock outstanding during the years ended December 31, 2016 and 2015. Potentially dilutive shares related to outstanding common stock options of 40,000 for the year ended December 31, 2015, and the RMB Warrants of 1,624,748 for the year ended December 31, 2015 were excluded from the calculation of diluted earnings (loss) per share because the effects were anti-dilutive. There were no similar potentially dilutive securities outstanding at December 31, 2016, and the effects of the potentially dilutive shares outstanding during the year ended December 31, 2016 were excluded from the calculation of diluted earnings 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 9, “Employee Stock Compensation Plans,” below. Recent accounting pronouncements In May 2014, the FASB issued Accounting Standards Update ("ASU") 2014-09, Revenue from Contracts with Customers (Topic 606), In February 2016, the FASB issued ASU 2016-02, “Leases” (“ASU No. 2016-02”), which will require lessees to recognize a right-of-use asset and a lease liability for all leases that are not short-term in nature. For a lessor, the accounting applied is also largely unchanged from previous guidance. The new rules will be effective for Solitario in the first quarter of 2019. Solitario does not anticipate early adoption. Solitario does not expect the adoption of ASU No. 2016-02 to materially change its current accounting methods and therefore it does not expect the adoption to have a material impact on its consolidated financial position or results of operations. In January 2016 the FASB issued ASU No 2016-01, Financial Instruments – Recognition and Measurement of Financial Assets and Financial Liabilities (Topic 825) (“ASU No. 2016-01”) . |
Business and Summary of Signi19
Business and Summary of Significant Accounting Policies (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Accounting Policies [Abstract] | |
Gain on Sale of Discontinued Operations | (in thousands) Year ended December 31, 2015 Proceeds from sale of MH-LLC $24,000 Net assets and liabilities disposed of 9,998 Noncontrolling interest 256 Expenses of sale of MH-LLC 439 Gain on sale of discontinued operations, before tax 13,307 Income tax expense 998 Gain on sale of discontinued operations $12,309 |
Mineral Properties (Tables)
Mineral Properties (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Extractive Industries [Abstract] | |
Investment in Mineral Property | (in thousands) December 31, 2016 2015 Exploration La Promesa (Peru) $ 6 $ 6 Montana Royalty property (US) 40 - Canta Colorado (Peru) - 3 Norcan (Mexico) - 5 Aconchi (Mexico) - 5 Total exploration mineral property $46 $19 |
Development Costs | (in thousands) Year ended December 31, 2015 Development expenditures $692 Capitalized interest 493 Property payments 190 Capitalized depreciation 7 Total capitalized costs $ 1,382 |
Exploration Expense | For the year ended December 31, (in thousands) 2016 2015 Geologic and field expenses $537 $31 Administrative 91 58 Total exploration expense $628 $89 |
Marketable Equity Securities (T
Marketable Equity Securities (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Notes to Financial Statements | |
Marketable Equity Securities and Accumulated Other Comprehensive Income | (in thousands) December 31, 2016 2015 Marketable equity securities at fair value $1,339 $202 Cost 274 91 Accumulated other comprehensive income for 1,065 111 Deferred taxes on accumulated other comprehensive 353 - Accumulated other comprehensive income $ 712 $ 111 |
Changes In Marketable Securities | (in thousands) Year ended 2016 2015 Gross cash proceeds from sales $ 56 $ 809 Cost 16 1,778 Gross gain (loss) on sale included in earnings during the period 40 (969) Deferred taxes on gross gain on sale included in earnings (15) - Reclassification adjustment to unrealized gain in other (25) 969 Gross unrealized holding gain (loss) arising during the period 994 (1,296) Deferred taxes on unrealized holding losses included in other comprehensive (income) loss (368) 1,558 Net unrealized holding gain 626 262 Other comprehensive income from marketable equity $601 $1,231 |
Other Assets (Tables)
Other Assets (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract] | |
Other Assets | (in thousands) December 31, 2016 2015 Furniture and fixtures, net of accumulated depreciation $ 32 $ 41 Exploration bonds and other assets 4 4 Vendetta Warrants 735 - Total other assets $771 $ 45 |
Income Taxes (Tables)
Income Taxes (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Income Tax Disclosure [Abstract] | |
Income Tax Expense | (in thousands) 2016 2015 Current: Federal $ - $ - State - - Foreign - - Deferred: Federal (309) 662 State (44) (102) Foreign - - Income tax (benefit) expense $ (353) $560 |
Income Tax Expense in Financial Statements | (in thousands) 2016 2015 Continuing Operations $ (353) $ 560 Discontinued Operations - 998 Other Comprehensive Income 353 (1,558) |
Deferred Tax Assets and Liabilities | (in thousands) 2016 2015 Deferred tax assets: Loss carryovers $8,168 $6,982 Stock option compensation expense - 7 Royalty 1,482 1,482 Unrealized loss on derivative securities - 38 Other 105 105 Valuation allowance (9,118) (8,571) Total deferred tax assets 637 43 Deferred tax liabilities: Unrealized gain on derivative securities 196 - Unrealized gains on marketable equity securities 395 41 Other 46 2 Total deferred tax liabilities 637 43 Net deferred tax liabilities $ - $ - |
Reconciliation of Income Taxes | (in thousands) 2016 2015 Expected income tax benefit $(701) $(976) Reversal of disproportionate tax effect in other comprehensive income - 1,558 Equity based compensation 366 575 Foreign tax rate differences 6 3 State income tax (237) (606) True-up of deferred taxes - 267 Tax attributes of disposed subsidiary 1,652 3,941 Previously unrecognized basis in disposed subsidiary (1,884) (4,170) Change in valuation allowance 547 (40) MH-LLC investment - 1 Permanent differences and other (102) 7 Income tax (benefit) expense $ (353) $ 560 |
Derivative Instruments (Tables)
Derivative Instruments (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Gain on Derivative Instruments | (in thousands) Year ended December 31, 2016 2015 Gain on Kinross calls $ 43 $84 Gain on Vendetta Warrants 629 - $672 $84 |
Fair Value Derivative Instruments | Derivatives (in thousands) Balance Sheet Location 2016 2015 Vendetta warrants Other assets $735 $ - RMB warrants Other current liabilities $ - $ 4 Kinross calls Other current liabilities $ 2 $ - |
Fair Value of Financial Instr25
Fair Value of Financial Instruments (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Fair Value Disclosures [Abstract] | |
Fair Value Financial Assets and Liabilities | (in thousands) Level 1 Level 2 Level 3 Total Assets Marketable equity securities $1,339 $ - $ - $1,339 Vendetta Warrants 735 735 Liabilities Kinross calls - 2 - 2 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, 2015: (in thousands) Level 1 Level 2 Level 3 Total Assets Marketable equity securities $202 $ - $ - $202 Liabilities RMB Warrants - 4 - 4 |
Employee Stock Compensation P26
Employee Stock Compensation Plans (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Grant Date Fair Value | Grant Date 6/22/16 Option – grant date price (Cdn$) $0.72 Options granted 350,000 Expected life years 5.0 Expected volatility 63% Risk free interest rate 1.0% Weighted average fair value $0.30 Grant date fair value $105,000 The following table shows the grant date fair value of Solitario’s only award during either 2016 or 2015 from the 2013 Plan as of the date of grant. Grant date fair value Grant Date 7/28/16 Option – grant date price $0.72 Options granted 1,699,000 Expected life years 5.0 Expected volatility 63% Risk free interest rate 0.9% Weighted average fair value $0.50 Grant date fair value $850,000 |
Summary Stock Options | 2016 2015 Weighted Weighted Average Aggregate Average Aggregate Exercise Intrinsic Exercise Intrinsic Options Price (Cdn$) Value(1) Options Price (Cdn)$ Value(1) 2006 Plan Outstanding, beginning of year 40,000 $1.66 2,348,000 $1.66 Granted 350,000 $0.72 - - Exercised - - - - Cancelled/expired (2) (390,000) $0.82 (2,188,000) 1.66 Forfeited - - (120,000) 1.60 Outstanding, end of year - - $ - 40,000 $1.60 $ - Exercisable, end of year - - $ - 20,000 $1.60 $ - (1)The intrinsic value at December 31, 2015 based upon the quoted market price of Cdn$0.70, respectively, per share for our common stock on the TSX and an exchange ratio of 0.72120, United States dollars per Canadian dollar. There were no options outstanding from the 2006 Plan at December 31, 2016. (2)On August 24, 2016, holders of option awards from the 2006 Plan voluntarily cancelled awards for 350,000 options with an option price of Cdn$.072 with an expiration date of June 21, 2021 and 40,000 options with an option price of Cdn$1.66 with an expiration date of August 14, 2019 to allow Solitario to have additional financial flexibility. No consideration was given or received by the holders of the options to cancel the awards. During 2016 and 2015 no options granted from the 2013 Plan were exercised. The following table summarizes the activity for stock options and RSUs outstanding under the 2013 Plan as of December 31, 2016 and 2015: 2016 2015 Weighted Weighted Average Aggregate Average Aggregate RSUs/ Exercise Intrinsic RSUs/ Exercise Intrinsic Options Price Value(1) Options Price Value(1) 2013 Plan Outstanding, beginning of year - - 1,400,000 $0.96 Granted 1,699,000 $0.72 - - Exercised - - - - Cancelled/expired(2) (1,699,000) 0.94 (1,250,000) 0.94 Forfeited - 1.10 (150,000) 1.10 Outstanding, end of year - - $ - - - $ - Exercisable, end of year - - $ - - - $ - |
Business and Summary of Signi27
Business and Summary of Significant Accounting Policies - Business - Gain on Sale of Discontinued Operations (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2015 | |
Accounting Policies [Abstract] | ||
Proceeds from sale of MH-LLC | $ 24,000 | |
Net assets and liabilities disposed of | 9,998 | |
Noncontrolling interest | 256 | |
Expenses of sale of MH-LLC | 439 | |
Gain on sale of discontinued operations, before tax | 13,307 | |
Income tax expense | 998 | |
Gain on sale of discontinued operations | $ 12,309 |
Business and Summary of Signi28
Business and Summary of Significant Accounting Policies (Details Narrative) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Aug. 25, 2015 | |
Accounting Policies [Abstract] | |||
Total cash proceeds for sale of discontinued operations aug 25 15 | $ 30,000 | ||
Solitario interest in MH-LLC | 80.00% | ||
DHI percentage of interest in MH-LLC | 20.00% | ||
Solitario portion of proceeds from sale of discontinued operations | $ 24,000 | ||
DHI portion of proceeds from sale of discontinued operations aug 25 15 | 6,000 | ||
Professional service fees for sale of discontinued operations | $ 439 | ||
Funds repaid pursuant to a facility agreement | $ 5,000 | ||
Interest and fees paid pursuant to a facility agreement | $ 7 | ||
Warrants expired unexercised | 1,624,748 | ||
Current assets in United States Treasury securities | $ 7,510 | ||
Certificates of deposit | 7,499 | ||
Maximum value of each certificate of deposit | $ 250 | ||
Shares related to outstanding common stock options excluded from diluted earnings | 40,000 | ||
RMB warrants exercisable excluded form diluted income | 1,624,748 |
Mineral Properties - Mineral Pr
Mineral Properties - Mineral Properties - Investment in Mineral Property (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2015 | |
La Promesa (Peru) | ||
Exploration | $ 6 | $ 6 |
Montana Royalty Property | ||
Exploration | 40 | |
Canta Colorado (Peru) | ||
Exploration | 3 | |
Norcan (Mexico) | ||
Exploration | 5 | |
Aconchi (Mexico) | ||
Exploration | $ 5 |
Mineral Properties - Mineral 30
Mineral Properties - Mineral Properties - Development Costs (Details) $ in Thousands | 12 Months Ended |
Dec. 31, 2015USD ($) | |
Extractive Industries [Abstract] | |
Development expenditures | $ 692 |
Capitalized interest | 493 |
Property payments | 190 |
Capitalized depreciation | 7 |
Total capitalized costs | $ 1,382 |
Mineral Properties - Mineral 31
Mineral Properties - Mineral Properties - Exploration Expense (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2015 | |
Extractive Industries [Abstract] | ||
Geologic and field expenses | $ 537 | $ 31 |
Administrative | 91 | 58 |
Total exploration expense | $ 628 | $ 89 |
Mineral Properties (Details Nar
Mineral Properties (Details Narrative) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2015 | |
Extractive Industries [Abstract] | ||
Issuance of common shares to leaseholders | 66,500 | |
Fair value of shares issued to leaseholders | $ 51 | |
Acquisition of net smelter royalties | $ 40 | |
Mineral property write-down Mexico properties | 10 | |
Mineral property write-down Peru property | 3 | |
Loss of other assets Mexico | $ 14 |
Marketable Equity Securities -
Marketable Equity Securities - Marketable Equity Securities and Accumulated Other Comprehensive Income (Details) - USD ($) $ in Thousands | Dec. 31, 2016 | Dec. 31, 2015 |
Notes to Financial Statements | ||
Marketable equity securities at fair value | $ 1,339 | $ 202 |
Cost | 274 | 91 |
Accumulated other comprehensive income for unrealized holding gains | 1,065 | 111 |
Deferred taxes on accumulated other comprehensive income for unrealized holding gains | 353 | |
Accumulated other comprehensive income | $ 712 | $ 111 |
Marketable Equity Securities 34
Marketable Equity Securities - Changes In Marketable Securities (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2015 | |
Notes to Financial Statements | ||
Gross cash proceeds from sales | $ 56 | $ 809 |
Cost | 16 | 1,778 |
Gross gain (loss) on sale included in earnings during the period | 40 | (969) |
Deferred taxes on gross gain on sale included in earnings | (15) | |
Reclassification adjustment to unrealized gain in other comprehensive income for net (gain) loss included in earnings | (25) | 969 |
Gross unrealized holding gain (loss) arising during the period included in other comprehensive income (loss) | 994 | (1,296) |
Deferred taxes on unrealized holding losses included in other comprehensive (income) loss | (368) | 1,558 |
Net unrealized holding gain | 626 | 262 |
Other comprehensive income from marketable equity securities | $ 601 | $ 1,231 |
Marketable Equity Securities (D
Marketable Equity Securities (Details Narrative) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2016 | May 02, 2016 | Dec. 31, 2015 | |
Notes to Financial Statements | |||
Shares of Vendetta purchased | 7,240,000 | ||
Aggregagte consideration for shares of Vendetta; purchase cost of shares of 186,000; purchase cost of warrants 103,000 | $ 735 | $ 289 | |
Gain on derivative instruments related to Vendetta Warrants | $ 629 |
Other Assets - Other Assets (De
Other Assets - Other Assets (Details) - USD ($) $ in Thousands | Dec. 31, 2016 | May 02, 2016 | Dec. 31, 2015 |
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract] | |||
Furniture and fixtures, net of accumulated depreciation | $ 32 | $ 41 | |
Exploration bonds and other assets | 4 | 4 | |
Vendetta Warrants | 735 | $ 289 | |
Total other assets | $ 771 | $ 45 |
Income Taxes - Income Tax Expen
Income Taxes - Income Tax Expense (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2015 | |
Current: | ||
Federal | ||
State | ||
Foreign | ||
Deferred: | ||
Federal | (309) | 662 |
State | (44) | (102) |
Foreign | ||
Income tax (benefit) expense | $ (353) | $ 560 |
Income Taxes - Income Tax Exp38
Income Taxes - Income Tax Expense in Financial Statements (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2015 | |
Income Tax Disclosure [Abstract] | ||
Continuing Operations | $ (353) | $ 560 |
Discontinued Operations | 998 | |
Other Comprehensive Income | $ 353 | $ (1,558) |
Income Taxes - Deferred Tax Ass
Income Taxes - Deferred Tax Assets and Liabilities (Details) - USD ($) $ in Thousands | Dec. 31, 2016 | Dec. 31, 2015 |
Deferred tax assets: | ||
Loss carryovers | $ 8,168 | $ 6,982 |
Stock option compensation expense | 7 | |
Royalty | 1,482 | 1,482 |
Unrealized loss on derivative securities | 38 | |
Other | 105 | 105 |
Valuation allowance | (9,118) | (8,571) |
Total deferred tax assets | 637 | 43 |
Deferred tax liabilities: | ||
Unrealized gain on derivative securities | 196 | |
Unrealized gains on marketable equity securities | 395 | 41 |
Other | 46 | 2 |
Total deferred tax liabilities | 637 | 43 |
Net deferred tax liabilities |
Income Taxes - Reconciliation o
Income Taxes - Reconciliation of Income Taxes (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2015 | |
Income Tax Disclosure [Abstract] | ||
Expected income tax benefit | $ (701) | $ (976) |
Reversal of disproportionate tax effect in other comprehensive income | 1,558 | |
Equity based compensation | 366 | 575 |
Foreign tax rate differences | 6 | 3 |
State income tax | (237) | (606) |
True-up of deferred taxes | 267 | |
Tax attributes of disposed subsidiary | 1,652 | 3,941 |
Previously unrecognized basis in disposed subsidiary | (1,884) | (4,170) |
Change in valuation allowance | 547 | (40) |
MH-LLC investment | 1 | |
Permanent differences and other | (102) | 7 |
Income tax (benefit) expense | $ (353) | $ 560 |
Income Taxes (Details Narrative
Income Taxes (Details Narrative) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2015 | |
Income Tax Disclosure [Abstract] | ||
Losses from foreign operations | $ 154 | $ 98 |
Before tax gain reported in discontinued operations | 13,307 | |
Tax expense reported in discontinued operations, net | 998 | |
Tax benefit for the release of valuation allowance | 3,930 | |
Other comprehensive income (loss) recognized | 954 | (327) |
Income tax benefit recognized | 353 | (560) |
Valuation allowance fully offsetting attendant tax benefit | $ 111 | |
US Federal NOL | 1,658 | |
US State NOL | 3,191 | |
Unused Capital Loss carryovers | $ 11,845 |
Derivative Instruments - Gain o
Derivative Instruments - Gain on Derivative Instruments (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2015 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | ||
Gain on Kinross calls | $ 43 | $ 84 |
Gain on Vendetta Warrants | 629 | |
Gain on derivative instruments | $ 672 | $ 84 |
Derivative Instruments - Deriva
Derivative Instruments - Derivative Instruments - Fair Value Derivative Instruments (Details) - USD ($) $ in Thousands | Dec. 31, 2016 | Dec. 31, 2015 |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | ||
Vendetta warrants other assets) | $ 735 | |
RMB warrants (other current liabilities) | 4 | |
Kinross calls (other current liabilities) | $ 2 |
Derivative Instruments (Details
Derivative Instruments (Details Narrative) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2015 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | ||
Liability for RMB Warrant | $ 4 | |
Gain on derivative instruments expiration of RMB Warrants | $ 4 | |
Fair value Kinross calls | $ 2 |
Fair Value of Financial Instr45
Fair Value of Financial Instruments - Fair Value Financial Assets and Liabilities (Details) - USD ($) $ in Thousands | Dec. 31, 2016 | Dec. 31, 2015 |
Assets | ||
Marketable equity securities | $ 1,339 | $ 202 |
Liabilities | ||
RMB Warrants | 4 | |
Level 1 | ||
Assets | ||
Marketable equity securities | 1,339 | 202 |
Vendetta Warrants | ||
Liabilities | ||
Kinross calls | ||
RMB Warrants | ||
Level 2 | ||
Assets | ||
Marketable equity securities | ||
Vendetta Warrants | 735 | |
Liabilities | ||
Kinross calls | 2 | |
RMB Warrants | 4 | |
Level 3 | ||
Assets | ||
Marketable equity securities | ||
Vendetta Warrants | ||
Liabilities | ||
Kinross calls | ||
RMB Warrants |
Commitments and Contingencies (
Commitments and Contingencies (Details Narrative) $ in Thousands | 12 Months Ended |
Dec. 31, 2016USD ($) | |
Commitments and Contingencies Disclosure [Abstract] | |
Estimated future property payments | $ 271,000 |
Estimated future property payments reimbursable | 263,000 |
Non-cancelable operating lease through January 2019 | $ 38,000 |
Employee Stock Compensation P47
Employee Stock Compensation Plans - ESOP - Grant Date Fair Value (Details) - $ / shares | 12 Months Ended | ||
Dec. 31, 2016 | Jul. 28, 2016 | Jun. 22, 2016 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |||
Option – grant date price (Cdn$) | $ 0.72 | ||
Option - grant date price (USD) | $ .72 | ||
Options granted | 1,699,000 | 350,000 | |
Expected life years | 5 years | ||
Expected volatility | 63.00% | ||
Risk free interest rate | 0.90% | 1.00% | |
Weighted average fair value | $ 0.50 | $ 0.30 | |
Grant date fair value | $ 850 | $ 105 |
Employee Stock Compensation P48
Employee Stock Compensation Plans - Employee Stock Compensation Plans - Summary Stock Options (Details) - $ / shares | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2015 | |
Options 2006 Plan | ||
Outstanding, beginning of year | 40,000 | 2,348,000 |
Outstanding, beginning of year, Per Share | $ 1.66 | $ 1.66 |
Granted | 350,000 | |
Granted, Per Share | $ .72 | |
Exercised | ||
Exercised, Per Share | ||
Cancelled/Expired/Forfeited (2)(3) | 390,000 | 2,308,000 |
Cancelled/Expired/Forfeited (2)(3), Per Share | $ .82 | $ 1.66 |
Outstanding, end of year | 40,000 | |
Outstanding, end of year, Per Share | $ 1.60 | |
Exercisable, end of year | 20,000 | |
Exercisable, end of year, Per Share | $ 1.60 | |
Options/RSUs 2013 Plan | ||
Outstanding, beginning of year | 1,400,000 | |
Outstanding, beginning of year, Per Share | $ 0.96 | |
Granted | 1,699,000 | |
Granted, Per Share | $ .72 | |
Exercised | ||
Exercised, Per Share | ||
Cancelled/Expired/Forfeited (2)(3) | 1,699,000 | 1,400,000 |
Cancelled/Expired/Forfeited (2)(3), Per Share | $ .94 | $ .94 |
Outstanding, end of year | ||
Outstanding, end of year, Per Share | ||
Exercisable, end of year | ||
Exercisable, end of year, Per Share |
Employee Stock Compensation P49
Employee Stock Compensation Plans (Details Narrative) - USD ($) $ in Thousands | 12 Months Ended | |||
Dec. 31, 2016 | Dec. 31, 2015 | Jun. 18, 2013 | Jun. 27, 2006 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | ||||
Stock option expense | $ 970 | $ 516 | ||
Total options available for grant under options plans | 1,750,000 | 2,800,000 |
Share Repurchase Program (Detai
Share Repurchase Program (Details Narrative) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Oct. 28, 2015 | |
Notes to Financial Statements | |||
Shares authorized to repurchase | 2,000,000 | ||
Shares repurchased | 475,600 | 145,000 | |
Aggregate price of shares repurchased | $ 248 | $ 67 | |
Total shares repurchased since program's inception | 620,600 | ||
Aggregate price of shares repurchased since program's inception | $ 315 |