Document and Entity Information
Document and Entity Information - USD ($) | 12 Months Ended | ||
Dec. 31, 2018 | Feb. 28, 2019 | Jun. 30, 2018 | |
Document And Entity Information | |||
Entity Registrant Name | SOLITARIO ZINC CORP. | ||
Entity Central Index Key | 917,225 | ||
Document Type | 10-K | ||
Document Period End Date | Dec. 31, 2018 | ||
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 | ||
Is Entity Emerging Growth Company? | false | ||
Entity Filer Category | Non-accelerated Filer | ||
Entity Small Business | true | ||
Entity Public Float | $ 22,719,323 | ||
Entity Common Stock, Shares Outstanding | 58,160,718 | ||
Document Fiscal Period Focus | FY | ||
Document Fiscal Year Focus | 2,018 | ||
Entity Shell Company | false |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) $ in Thousands | Dec. 31, 2018 | Dec. 31, 2017 |
Current assets: | ||
Cash and cash equivalents | $ 117 | $ 214 |
Short-term investments, at fair value | 10,223 | 11,642 |
Investments in marketable equity securities, at fair value | 1,585 | 2,643 |
Prepaid expenses and other | 211 | 114 |
Total current assets | 12,136 | 14,613 |
Mineral properties | 15,657 | 15,657 |
Other assets | 110 | 125 |
Total assets | 27,903 | 30,395 |
Current liabilities: | ||
Accounts payable | 688 | 141 |
Long-term liabilities | ||
Asset retirement obligation - Lik | 125 | 125 |
Shareholders’ equity: | ||
Preferred stock, $0.01 par value, authorized 10,000,000 shares (none issued and outstanding at December 31, 2018 and 2017) | ||
Common stock, $0.01 par value, authorized, 100,000,000 shares (58,171,466 and 58,434,566, respectively, shares issued and outstanding at December 31, 2018 and 2017) | 582 | 584 |
Additional paid-in capital | 69,873 | 69,312 |
Accumulated deficit | (43,365) | (40,343) |
Accumulated Other Comprehensive Income | 576 | |
Total shareholders' equity | 27,090 | 30,129 |
Total liabilities and shareholders equity | $ 27,903 | $ 30,395 |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parenthetical) - $ / shares | Dec. 31, 2018 | Dec. 31, 2017 |
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 | 58,171,466 | 58,434,566 |
Common stock, shares outstanding | 58,171,466 | 58,434,566 |
Consolidated Statements of Oper
Consolidated Statements of Operations - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2018 | Dec. 31, 2017 | |
Income Statement [Abstract] | ||
Revenue – mineral property sale | $ 502 | |
Costs, expenses and other | ||
Exploration expense | 1,254 | 699 |
Depreciation and amortization | 25 | 13 |
General and administrative | 1,954 | 1,202 |
Total costs, expenses and other | 3,233 | 1,914 |
Interest and dividend income (net) | 192 | 123 |
Gain on sale of marketable equity securities | 578 | |
Unrealized loss on marketable equity securities | (1,058) | |
Gain on derivative instruments | 271 | |
Loss on sale of assets | (1) | |
Total other income (expense) | (867) | 972 |
Net loss | $ 3,598 | $ 942 |
basic and diluted | $ (0.06) | $ (0.02) |
Weighted average shares outstanding | ||
Basic and diluted | 58,360 | 47,990 |
Consolidated Statements of Comp
Consolidated Statements of Comprehensive Loss - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2018 | Dec. 31, 2017 | |
Consolidated Statements Of Comprehensive Loss | ||
Net loss for the period, before other comprehensive loss | $ 3,598 | $ 942 |
Other comprehensive loss: | ||
Unrealized gain (loss) on marketable equity securities, net of deferred taxes | (1,058) | (136) |
Comprehensive loss | $ (3,598) | $ (1,078) |
Consolidated Statements of Shar
Consolidated Statements of Shareholders' Equity - USD ($) $ in Thousands | Common Stock | Additional Paid-In Capital | Retained Earnings / Accumulated Deficit | Other Comprehensive Income / Loss | Total |
Beginning balance, value at Dec. 31, 2016 | $ 387 | $ 55,790 | $ (39,401) | $ 712 | $ 17,488 |
Beginning balance, shares at Dec. 31, 2016 | 38,693,589 | ||||
Issuance of shares- acquisition, value | $ 198 | 13,456 | 13,654 | ||
Issuance of shares- acquisition, shares | 19,788,177 | ||||
Replacement options | 164 | 164 | |||
Stock option expense | 50 | 50 | |||
Repurchase of shares for cancellation, value | $ (1) | (31) | (32) | ||
Repurchase of shares for cancellation, shares | (47,200) | ||||
Net loss | (942) | (942) | |||
Net unrealized loss on marketable equity securities (net of deferred taxes) | (136) | (136) | |||
Ending balance, value at Dec. 31, 2017 | $ 584 | 69,312 | (40,343) | 576 | 30,129 |
Ending balance, shares at Dec. 31, 2017 | 58,434,566 | ||||
Cumulateve-effect adjustment change in accounting principle | 576 | $ (576) | |||
Issuance of shares- acquisition, value | |||||
Stock option expense | 660 | 660 | |||
Repurchase of shares for cancellation, value | $ (2) | (99) | (101) | ||
Net loss | (3,598) | (3,598) | |||
Ending balance, value at Dec. 31, 2018 | $ 582 | $ 69,873 | $ (43,365) | $ 27,090 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2018 | Dec. 31, 2017 | |
Operating activities: | ||
Net loss | $ (3,598) | $ (942) |
Adjustments to reconcile net loss to net cash used in operating activities: | ||
Unrealized loss on marketable equity securities | 1,058 | |
Gain on sale of marketable equity securities | (578) | |
Gain on derivative instruments | (271) | |
Employee stock option expense | 660 | 50 |
Depreciation and amortization | 25 | 13 |
Loss on sale of assets | 1 | |
Changes in operating assets and liabilities: | ||
Prepaid expenses and other current assets | (50) | 52 |
Accounts payable and other current liabilities | 547 | 18 |
Net cash (used in) operating activities | (1,357) | (1,658) |
Investing activities: | ||
Sale of short-term investments - net | 1,371 | 3,563 |
Loan to Zazu | (1,500) | |
Purchase of Zazu, net of cash acquired | (417) | |
Purchase of marketable equity securities | (578) | |
Proceeds from sale of marketable equity securities | 666 | |
Sale of derivative instrument, net | 53 | |
Additions to other assets | (10) | (2) |
Net cash provided by investing activities | 1,361 | 1,785 |
Financing activities: | ||
Repurchase of Solitario common stock for cancellation | (101) | (32) |
Net cash used in financing activities | (101) | (32) |
Net (decrease) increase in cash and cash equivalents | (97) | 95 |
Cash and cash equivalents, beginning of year | 214 | 119 |
Cash and cash equivalents, end of year | 117 | 214 |
Supplemental disclosure of non-cash activities: | ||
Additions to mining equipment –Zazu, through issuance of stock in Acquisition | (100) | |
Additions to mineral property- Zazu, through issuance of stock in Acquisition | (15,611) | |
Additions to current assets, net – Zazu, through issuance of stock in Acquisition | (42) | |
Issuance of common stock – Zazu acquisition | 13,654 | |
Convertible debenture – due from Zazu cancelled | 1,510 | |
Asset retirement obligation - Lik | 125 | |
Issuance of replacement options – Zazu | 164 | |
Transfer of warrant value to marketable equity securities on exercise of Vendetta Warrants | $ 949 |
Business and Summary of Signifi
Business and Summary of Significan Accounting Policies | 12 Months Ended |
Dec. 31, 2018 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Business and Summary of Significan Accounting Policies | 1. Business and Summary of Significant Accounting Policies Business and company formation Solitario Zinc Corp. (“Solitario,” “Company”) is an exploration stage company as defined in 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 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 likely 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. As a result of the Acquisition (defined below), Solitario is now primarily focused on the acquisition and exploration of zinc-related exploration mineral properties. In addition to focusing on its mineral exploration properties and the evaluation of mineral properties, 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 Solitario determines to be favorable to Solitario. Purchase of Zazu On July 12, 2017, Solitario completed the acquisition of Zazu Metals Corp. (“Zazu”) pursuant to a definitive arrangement agreement between Solitario and Zazu (the "Arrangement Agreement") whereby Solitario agreed to acquire all of the issued and outstanding common shares of Zazu (the "Zazu Shares") by way of a statutory plan of arrangement (the "Arrangement") under the Canada Business Corporations Act (in thousands) July 12, 2017 Issuance of 19,788,177 shares of Solitario common stock $13,654 Replacement options 164 Investment banking and transaction costs 782 Convertible debenture due Solitario, cancelled 1,510 Total purchase price $16,110 The Acquisition was treated as an asset purchase. Accordingly, as the purchase of an asset (essentially the interest in the Lik project in Alaska) Solitario capitalized related transaction costs associated with the Acquisition, including the following costs: (in thousands) July 12, 2017 Investment banking fees $552 Legal and accounting costs 196 Other costs and fees 34 Total capitalized transaction costs $782 The purchase price was allocated to the assets and liabilities acquired from Zazu on the date of the Acquisition as follows: (in thousands) July 12, 2017 Cash $974 Other current assets 42 Equipment 100 Mineral property 15,611 Accounts payable (492) Asset retirement obligation – Lik (125) Total purchase price $16,110 The cash transaction costs less the cash acquired are shown as the cash transaction costs for the year ended December 31, 2017 on the consolidated statement of cash flows. Solitario also incurred stock issuance costs of $117,000, related to the Acquisition, which were charged to equity. Solitario has recorded revenue in the past from the sale of mineral property, including the sale on April 26, 2018 of its interest in the royalty on the Yanacocha property (discussed below) and the sale in 2015 of its former interest in Mount Hamilton LLC the owner of its former Mt. Hamilton project (the “Mt. Hamilton Transaction”), and joint venture property payments and the sale of a royalty on its former Mt. Hamilton project. 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. Solitario currently considers its carried interest in the Florida Canyon project and its interest in the Lik project to be its core mineral property assets. Nexa Resources, Ltd. (“Nexa”), Solitario’s joint venture partner, is expected to continue the development and furtherance of the Florida Canyon project and Solitario is monitoring progress at Florida Canyon. Solitario is working with its 50% joint venture partner, Teck American Incorporated, a wholly-owned subsidiary of Teck Resources Limited (both companies are referred to as “Teck”), in the Lik deposit to further the exploration and evaluate potential development plans for the Lik project. As of December 31, 2018, Solitario has significant balances of cash and short-term investments that Solitario anticipates using, in part, to further the development of the Florida Canyon project and the Lik project and to potentially acquire additional mineral property assets. The 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 adopted ASU 2014-09 (defined below under “Recent accounting pronouncements”) on January 1, 2018. ASU 2014-09 primarily impacts revenue recognition based upon the timing of transfer of control of goods and services sold. Historically Solitario has recorded revenue from the sale of exploration mineral properties and joint venture property payments. Solitario’s policy is to recognize revenue from the sale of its exploration mineral properties (those without reserves) on a property by property basis, computed as the cash received and / or collectable receivables less any capitalized cost. Payments received for the sale of exploration property interests that are less than the properties cost are recorded as a reduction of the related property's capitalized cost. In addition, Solitario’s policy is to recognize revenue on any receipts of joint venture property payments in excess of its capitalized costs on a property that Solitario may lease to another mining company. Solitario has recognized revenue during 2018 for the first time in more than five years from the sale of an exploration mineral property, and expects, any property sales in the future to also be on an infrequent basis. The last proceeds from joint venture property payments was in 2015 and Solitario does not expect to record joint venture property payments on any of its currently held properties for the foreseeable future. Historically, Solitario’s revenues have been infrequent and significant individual transactions and have only been from sales to well known or vetted mining companies. Solitario has never had a return on any of its sales recorded as revenue in its history and does not anticipate it will recognize any estimated returns on its current or future recorded revenues. The adoption of ASU 2014-09 had no impact on Solitario’s recorded revenues for the year ended December 31, 2018 or 2017. Solitario recorded the revenue of $502,000 from the sale of the Yanacocha Royalty in accordance with ASU 2014-09. 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; and (v) Solitario's investment in marketable equity securities. 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 and cash equivalents Cash equivalents include investments in highly liquid money-market securities with original maturities of three months or less when purchased. At December 31, 2018, approximately $113,000 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 At December 31, 2018, Solitario has United States Treasury securities (“USTS”) with maturities of 15 days to 22 months recorded at their fair value of $9,345,000. At December 31, 2018, Solitario has $500,000 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, 2018, the CDs have maturities of three months. In addition, Solitario has a US dollar bank savings account in Peru with a fair value of $378,000. 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. (“Vendetta”) units, including the Vendetta Warrants (defined below) during 2016. During 2017, Solitario exercised all of its Vendetta Warrants and at December 31, 2018 and 2017 has no Vendetta Warrants. Changes in fair value of the Vendetta Warrants are recognized in the statements 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 statements of operations in the period of the change as gain or loss on derivative instruments. Fair value Financial Accounting Standards Board 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. See Note 8, “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 as unrealized gain or loss in the statement of operations. A decline in fair value that is considered other than temporary 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 2018 and 2017 were conducted primarily in Peru, a portion of the payments for the land, leasehold and exploration agreements as well as certain exploration activities 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 6, “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, 2018 and 2017. Potentially dilutive shares, consisting of outstanding common stock options for 5,223,160 and 1,982,428, respectively, Solitario common shares were excluded from the calculation of diluted earnings (loss) per share for the year ended December 31, 2018 and 2017 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 10, “Employee Stock Compensation Plans,” below. Recently adopted accounting pronouncements In January 2016 the FASB issued ASU 2016-01, “Financial Instruments – Overall (subtopic 825-10) Recognition and Measurement of Financial Assets and Liabilities,” (“ASU 2016-01”) . In May 2014, the FASB issued ASU No. 2014-09, Revenue from Contracts with Customers (Topic 606): Recently issued accounting pronouncements In February 2016, the FASB issued Accounting Standards Updated (“ASU”) 2016-02, “Leases” (“ASU 2016-02”). The new standard establishes a right-of-use (ROU) model that requires a lessee to record a ROU asset and a lease liability on the balance sheet for all leases with terms longer than 12 months. Leases will be classified as either finance or operating, with classification affecting the pattern of expense recognition in the income statement. The new standard is effective for interim and annual periods beginning after December 15, 2018. The new rules will be effective for Solitario in the first quarter of 2019. Solitario expect the adoption of ASU 2016-02 to materially change net income or total expense in the statement of operations from its current accounting methods and has estimated it will record an asset and offsetting liability of approximately $80,000 in the consolidated balance sheet upon adoption of ASU 2016-02 in January 2019. The FASB issued ASU No. 2016-13, Financial Instruments – Credit Losses (Topic 326): Measurements of Credit Losses on Financial Statements . In February 2018, the FASB issued ASU 2018-02, “Reclassification of Certain Tax Effects from Accumulated Other Comprehensive Income” (ASU 2018-02”), which allows for a reclassification from accumulated other comprehensive income or loss to retained earnings or accumulated deficit for stranded tax effects resulting from the Tax Cuts and Jobs Act of 2017 (“TCJA”). ASU 2018-02 also requires certain related disclosures. ASU 2018-02 is effective for annual periods, and interim periods within those annual periods, beginning after December 15, 2018 and should be applied either in the period of adoption or retrospectively to each period in which the effect of the change in the U.S. federal corporate income tax rate in the TCJA is recognized. Early adoption is permitted. Solitario does not expect the adoption of ASU 2018-02 will have a material effect on Solitario’s financial position or results of operations. |
Mineral Properties
Mineral Properties | 12 Months Ended |
Dec. 31, 2018 | |
Extractive Industries [Abstract] | |
Mineral Properties | 2. Mineral Properties The following table details Solitario’s capitalized investment in exploration mineral property: (in thousands) December 31, 2018 2017 Exploration Lik project (Alaska – US) $15,611 $15,611 La Promesa (Peru) 6 6 Montana Royalty property (US) 40 40 Total exploration mineral property $15,657 $15,657 Exploration property Solitario's exploration mineral properties at December 31, 2018 and 2017 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, 2018, 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. Solitario acquired the Lik project during 2017 in the Acquisition; see Note 1 above. In addition to its capitalized exploration properties, Solitario has an interest in its Florida Canyon exploration concessions, which are 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, 2018, no further standby joint-venture payments are due to Solitario on the Florida Canyon project. At December 31, 2018 and 2017, Solitario has no remaining capitalized costs related to its Florida Canyon joint venture. On April 26, 2018, Solitario sold the Yanacocha Royalty to a Newmont for $502,000 in cash. Newmont owns the underlying mineral concessions covered by the Yanacocha Royalty. None of the concessions covered by the Yanacocha Royalty have any reported reserves or resources. Solitario had no mineral property capitalized cost in the Yanacocha Royalty and recorded Mineral Property Revenue of $502,000 during 2018. Discontinued projects During 2017, Solitario abandoned its interests in the Aconchi and Norcan exploration properties in Mexico and Solitario no longer holds any interest in those properties. However, there were no capitalized mineral property costs related to these properties and Solitario did not record any mineral property write-downs during the year ended December 31, 2017. Exploration Expense The following items comprised exploration expense: For the year ended December 31, (in thousands) 2018 2017 Geologic and field expenses $1,165 $447 Administrative 89 252 Total exploration expense $1,254 $699 Asset Retirement Obligation In connection with the Acquisition, Solitario recorded an asset retirement obligation of $125,000 for Solitario’s estimated reclamation cost of the existing disturbance at the Lik project. This disturbance consists of an exploration camp including certain drill sites and access roads at the camp. The estimate was based upon estimated cash costs for reclamation as determined by the permitting bond required by the State of Alaska, for which Solitario has retained a reclamation bond insurance policy in the event Solitario or its 50% partner, Teck, do not complete required reclamation. Solitario has not applied a discount rate to the recorded asset retirement obligation as the estimated time frame for reclamation is not currently known, as reclamation is not expected to occur until the end of the Lik project life, which would follow future development and operations, the start of which cannot be estimated or assured at this time. Additionally, no depreciation will be recorded on the related asset for the asset retirement obligation until the Lik project goes into operation, which cannot be assured. |
Marketable Equity Securities
Marketable Equity Securities | 12 Months Ended |
Dec. 31, 2018 | |
Marketable Securities [Abstract] | |
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 warrant which allow 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 discussed below, during 2017 Solitario exercised all of its Vendetta Warrants, and sold 3,480,000 shares of Vendetta common stock. As of December 31, 2018, Solitario owns 11,000,000 shares of Vendetta common stock which 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 following tables summarize Solitario’s marketable equity securities and adjustments to fair value: (in thousands) Year ended 2018 2017 Marketable equity securities at cost $1,714 $1,714 Cumulative unrealized (loss) gain on marketable equity securities (129) 929 Marketable equity securities at fair value $1,585 $2,643 The following table represents changes in marketable equity securities: (in thousands) Year ended 2018 2017 Cost of marketable equity securities sold $ - $ 88 Realized gain on marketable equity securities sold - 578 Proceeds from the sale of marketable equity securities sold - (666) Purchase of marketable equity securities - 1,528 Gross (loss) gain on marketable equity securities (1,058) 442 Change in marketable equity securities at fair value $(1,058) $ 1,304 The following table represents the realized and unrealized gain (loss) on marketable equity securities: (in thousands) Year ended 2018 2017 Gross (loss) gain on marketable securities $(1,058) $442 Realized gain on marketable equity securities sold - (578) Unrealized (loss) on marketable equity securities $(1,058) $(136) During 2017, Solitario sold 3,480,000 Vendetta common shares, for cash proceeds of $666,000. In addition, during 2017, Solitario exercised its Vendetta Warrants, also discussed below in Note 4, “Other Assets” and received 7,240,000 common shares of Vendetta. Solitario transferred the fair value of the Vendetta Warrants on the date of exercise of $950,000, along with the cash paid to exercise the Vendetta Warrants of $578,000 to marketable equity securities as the cost of the 7,240,000 common shares of Vendetta acquired. |
Other Assets
Other Assets | 12 Months Ended |
Dec. 31, 2018 | |
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract] | |
Other Assets | 4. Other Assets: The following items comprised other assets: (in thousands) December 31, 2018 2017 Furniture and fixtures, net of accumulated depreciation $ 36 $ 31 Lik project equipment, net of accumulated depreciation 70 90 Exploration bonds and other assets 4 4 Total other assets $110 $125 During 2017, Solitario acquired $100,000 of exploration-related equipment at the Lik project as part of the Acquisition. The equipment is being depreciated over a five-year life on a straight-line basis and Solitario recorded depreciation expense of $20,000 and $10,000, respectively, during 2018 and 2017 related to this equipment. During 2017, Solitario exercised 7,240,000 of its Vendetta Warrants and received 7,240,000 Vendetta common shares, by paying $578,000 in cash to Vendetta. As a result, as of December 31, 2017, Solitario no longer owns any Vendetta Warrants. Upon the exercise of the Vendetta Warrants, Solitario transferred the fair value of the Vendetta Warrants on the date of exercise of $950,000 along with the cash paid to exercise the Vendetta Warrants of $578,000 to marketable equity securities as the cost of the 7,240,000 common shares of Vendetta acquired. During the year ended December 31, 2017, Solitario recorded a gain on derivative instruments of $216,000 related to the Vendetta Warrants, with no similar item during 2018; see Note 7, “Derivative Instruments,” below. |
Revenue Mineral Property Sale
Revenue Mineral Property Sale | 12 Months Ended |
Dec. 31, 2018 | |
Revenue Recognition [Abstract] | |
Revenue Mineral Property Sale | 5. Revenue mineral property sale On April 26, 2018, Solitario sold its royalty interest in the non-producing Yanacocha property (the “Yanacocha Royalty”) to a wholly owned subsidiary of Newmont Mining Corporation (“Newmont”) for approximately $502,000 in cash. The Yanacocha Royalty covered 43 concessions totaling 36,052 hectares. Newmont owns the underlying mineral concessions covered by the Yanacocha Royalty. None of the concessions covered by the Yanacocha Royalty had any reported reserves or resources. Solitario had no mineral property capitalized cost in the Yanacocha Royalty and recorded Mineral Property Revenue of $502,000 during 2018. |
Income Taxes
Income Taxes | 12 Months Ended |
Dec. 31, 2018 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | 6. Income Taxes Consolidated loss before income taxes includes losses from foreign operations of $260,000 and $322,000 in 2018 and 2017, respectively. The net deferred tax assets/liabilities in the December 31, 2018 and 2017 consolidated balance sheets include the following components: (in thousands) 2018 2017 Deferred tax assets: Loss carryovers $12,432 $12,178 Investment in Mineral Property 1,669 1,952 Capitalized Exploration Costs 877 1,205 Stock option compensation expense 150 13 Royalty - 989 Unrealized loss on derivative securities 60 28 Other 135 135 Valuation allowance (15,099) (16,249) Total deferred tax assets 224 251 Deferred tax liabilities: Unrealized gain on derivative securities - - Unrealized gains on marketable equity securities 209 230 Other 15 21 Total deferred tax liabilities 224 251 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) 2018 2017 Expected income tax benefit $(756) $(355) Equity based compensation - - Foreign tax rate differences (27) 17 State income tax (143) (27) Impact of Tax Legislation - 4,494 Adjustment to Deferred Taxes 2,058 - Change in Tax Rate 53 - Change in valuation allowance (1,164) (4,120) Permanent differences and other (21) (9) Income tax (benefit) expense $ - $ - On December 22, 2017, the Tax Cuts and Jobs Act of 2017 (the “Tax Act”) was signed into law making significant changes to the Internal Revenue Code. Changes include, but are not limited to, a federal corporate tax rate decrease from 35% to 21% for tax years beginning after December 31, 2017, the transition of U.S international taxation from a worldwide tax system to a territorial system, and a one-time transition tax on the mandatory deemed repatriation of foreign earnings. In accordance with ASC 740, Income Taxes, the impact of a change in tax law is recorded in the period of enactment. Consequently, Solitario recorded a decrease to its net deferred tax assets of $4,494,000 with a corresponding net adjustment to the valuation allowance for the year ended December 31, 2017. While the Tax Act provides for a territorial tax system, beginning in 2018, it includes two new U.S. tax base erosion provisions, the global intangible low-taxed income (“GILTI”) provisions and the base-erosion and anti-abuse tax (“BEAT”) provisions. The GILTI provisions require the Company to include in its U.S. income tax return foreign subsidiary earnings in excess of an allowable return on the foreign subsidiary’s tangible assets. The Company currently has no profitable foreign subsidiaries. Therefore, this provision currently has no impact on the Company. The BEAT provisions in the Tax Act eliminates the deduction of certain base-erosion payments made to related foreign corporations and impose a minimum tax if greater than regular tax. The Company does not expect it will be subject to this tax and therefore has not included any tax impacts of BEAT in its consolidated financial statements for the years ended December 31, 2018 and 2017. As a result of the acquisition of Zazu during the year ended December 31, 2017, Solitario acquired deferred tax assets totaling $10,366,000 primarily related to US federal and state net operating losses, mineral properties and exploration costs, and Canadian net operating losses. These deferred tax assets were fully offset by a valuation allowance. Solitario does not believe it is more likely than not that the assets will be utilized in the future. As a result of the ownership change of Zazu Metals (Alaska) Corp, utilization of its United States Federal and State of Alaska net operating losses will be limited due to the annual limitation provided by Section 382 of the Internal Revenue Code. During 2018, the valuation allowance decreased primarily due to the adjustments to deferred taxes that were part of the Zazu acquisition and the disposition of royalties that were part of the Yanacocha sale. During 2017, the valuation allowance was increased primarily due to the acquisition of Zazu and the impact of the Tax Act. At December 31, 2018, Solitario has unused US NOL carryovers of $15,404,000 and unused US State NOL carryovers of $15,980,000 which begin expiring in 2027. Solitario has unused Capital Loss carryovers of $11,132,000 for US Federal and US State purposes which begin expiring in 2019. Solitario has Canadian loss carryforwards of $9,205,000 which begin expiring in 2027. Other foreign loss carryforwards for which Solitario has provided a full valuation allowance related to Solitario’s exploration activities in Peru. The Peru losses do not expire. 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, 2018 or December 31, 2017, 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, State of Alaska, Canada and Peru. Solitario’s United States federal, Canada and State of Alaska returns for years 2016 and forward and Solitario’s Peru and State of Colorado returns for tax years 2014 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, 2018, or December 31, 2017 or for the years then ended. |
Derivative Instruments
Derivative Instruments | 12 Months Ended |
Dec. 31, 2018 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Derivative Instruments | 7. Derivative Instruments: 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, 2018, all of the covered calls had expired unexercised and there were no liabilities related to those calls entered during the year. Vendetta Warrants The Vendetta Warrants were exercised during 2017 and there are none remaining at December 31, 2018; see Note 4, “Other Assets” above. Solitario recorded the following gain on derivative instruments: (in thousands) Year ended December 31, 2018 2017 Gain on Kinross calls $ - $ 55 Gain on Vendetta Warrants - 216 $ - $271 |
Fair Value of Financial Instrum
Fair Value of Financial Instruments | 12 Months Ended |
Dec. 31, 2018 | |
Fair Value Disclosures [Abstract] | |
Fair Value of Financial Instruments | 8. 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 that 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, 2018 and 2017, 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, 2018: (in thousands) Level 1 Level 2 Level 3 Total Assets Short-term investments $10,223 $ - $ - $10,223 Marketable equity securities $ 1,585 $ - $ - $ 1,585 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, 2017: (in thousands) Level 1 Level 2 Level 3 Total Assets Short-term investments $11,642 $ - $ - $11,642 Marketable equity securities $ 2,643 $ - $ - $ 2,643 Items measured at fair value on a recurring basis: Short-term investments: Marketable equity securities : During the year ended December 31, 2018, 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, 2018 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | 9. 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 2019 property rentals and option payments for properties Solitario owns or operate to be approximately $729,000. Assuming that Solitario’s joint ventures continue in their current status and that Solitario does not appreciably change its property positions on existing properties, approximately $712,000 of these annual payments are paid or are reimbursable to us by Solitario’s joint venture partners. In addition, Solitario may be required to make further payments in the future enters into new agreements. Solitario has recorded an asset retirement obligation of $125,000 related to its Lik project in Alaska. See Note 2, “Mineral Properties,” above. 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 $43,000 through March of 2021. In August of 2018, Solitario agreed to fund a portion of a 2018 – 2019 drilling program at the Florida Canyon project. Per the agreement, Solitario will fund up to $1,580,000 of a planned 41-hole 17,000-meter drilling program to be conducted through December 31, 2019 (the “Drilling Program”). Upon Nexa completing the first 1,700 meters of the Drilling Program, Solitario will pay Nexa $527,000, upon completion of the next 1,700 meters (3,400 meters total) of the Drilling Program, Solitario will pay Nexa $527,000, and upon completion of the next 1,700 meters (5,100 meters total) of the Drilling Program, Solitario will pay Nexa the balance remaining on its $1,580,000 funding commitment, or $526,000. Solitario has no obligation to pay Nexa prior to the attainment of the separate 1,700-meter thresholds. The funding commitments are in the form of an advance on Solitario’s commitment to fund 30% of any future development of Florida Canyon under the existing joint venture agreement with Nexa. Accordingly, in the event Florida Canyon is developed, which cannot be assured at this time, any funds paid to Nexa under this agreement, will reduce the amount of Solitario’s obligation to fund 30% of future development costs, and / or repay loans from Nexa for future development costs at the Florida Canyon project. As of December 31, 2018, Nexa had completed four holes and a total of 2,203 meters under the Drilling Program, and Solitario has recorded an account payable to Nexa of $527,000 and recorded a charge to exploration expense of $527,000, should Nexa complete the remaining 2,897 meters (5,100 meters less the completed 2,203 meters) during 2019, Solitario will be obligated to pay Nexa $1,053,000 in addition to its currently recorded account payable of $527,000 during 2019. |
Employee Stock Compensation Pla
Employee Stock Compensation Plans | 12 Months Ended |
Dec. 31, 2018 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Employee Stock Compensation Plans | 10. Employee Stock Compensation Plans: On June 18, 2013, Solitario’s shareholders approved the Solitario Resources Corporation Omnibus Stock Incentive Plan (the “2013 Plan”). Under the terms of the 2013 Plan, as amended, a total of 5,750,000 shares of Solitario common stock are reserved for awards to directors, officers, employees and consultants. Awards granted under the 2013 Plan 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. a.) 2013 Plan stock option grants The following table shows the grant date fair value of Solitario’s awards during 2018 pursuant to the 2013 Plan: Grant Date 1/02/18 (1) 11/01/18 (2) Option – grant date price $0.62 $0.31 Options granted 100,000 1,623,000 Expected life years 0.80 5.00 Expected volatility 66% 64% Risk free interest rate 1.0% 3.0% Weighted average fair value $0.12 $0.17 Grant date fair value $12,000 $282,000 (1) Option granted to a consultant had an expected life of 0.8 years on grant date and was fully vested during 2018. Option remains vested for a maximum of five years from date of grant or termination of the consulting contract. (2) Option grants have a five-year term, and vest 25% on date of grant and 25% on each of the next three anniversary dates. The following table shows the grant date fair value of Solitario’s awards during 2017 pursuant to the 2013 Plan: Grant Date 7/12/17 (1) 7/12/17 (1) 7/12/17 (1) 7/12/17 (1) 9/01/17 (2) 9/01/17 (3) Option – grant date price $1.74 $1.52 $1.30 $0.54 $0.77 $0.77 Options granted 357,200 425,068 785,840 214,320 200,000 2,300,000 Expected life years 0.84 1.35 1.50 1.50 5.0 5.0 Expected volatility 67% 67% 67% 67% 64% 64% Risk free interest rate 1.0% 1.0% 1.0% 1.0% 1.7% 1.7% Weighted average fair value $0.02 $0.08 $0.12 $0.36 $0.42 $0.42 Grant date fair value $7,000 $26,000 $72,000 $59,000 $126,000 $970,000 (1) Replacement Options had terms of May 15, 2018, November 15, 2018, January 12, 2019 and January 12, 2019. The Replacement Options were fully vested on the date of grant. Replacement Options were priced in Canadian Dollars, the grant day prices reflect the US Dollar price exchange rate of .07749 Cdn$/US$ on the date of grant. (2) Options grants have a five-year term, and vest 25% on date of grant and 25% on each of the next three anniversary dates. (3) Conditional Options, (defined below) approved by Solitario shareholders on June 19, 2018. b.) Stock option activity During 2018 and 2017 no options granted from the 2013 Plan were exercised. The following table summarizes the activity for stock options outstanding under the 2013 Plan for the years ended December 31, 2018 and 2017: 2018 2017 Weighted Weighted Average Aggregate Average Aggregate RSUs/ Exercise Intrinsic RSUs/ Exercise Intrinsic Options Price Value (1) Options Price Value (2) Outstanding, beginning of year 1,982,428 $1.29 - - Granted (3) 4,023,000 $0.58 1,982,428 $1.29 Exercised - - - - Expired (782,268) $2.09 - - Forfeited - - - - Outstanding, end of year 5,223,160 $0.76 $ - 1,982,428 $1.29 $9,000 Exercisable, end of year 2,770,910 $0.95 $ - 1,832,428 $1.33 $9,000 (1) Intrinsic value based upon December 31, 2018 price of a share of Solitario common stock as quoted on the NYSE American exchange of $0.23 per share. (2) Intrinsic value based upon December 31, 2017 price of a share of Solitario common stock as quoted on the NYSE American exchange of $0.60 per share. (3) Options granted during 2018, include 2,300,000 Conditional Options, approved by Solitario shareholders on June 19, 2018. During the years ended December 31, 2018 and 2017, Solitario recorded $660,000 and $50,000, respectively, of stock option expense under the 2013 Plan for the amortization of the grant date fair value of each of its outstanding options with a credit to additional paid-in-capital. At December 31, 2018, the total unrecognized stock option compensation cost related to non-vested options is $639,000 and is expected to be recognized over a weighted average period of 24 months. On September 1, 2017, the Board of Directors granted, subject to shareholder approval at the next meeting of shareholders, 2,300,000 stock options under the 2013 Plan to officers and members of the Board of Directors (the “Conditional Options”). The Conditional Options were approved by Solitario’s shareholders at Solitario’s annual meeting on June 19, 2018. The Conditional Options vest on the schedule of 25% on date of approval of the grant (June 19, 2018) and 25% on each of the next three anniversary dates of the date of grant (September 1, 2018, 2019 and 2020). |
Share Repurchase Program
Share Repurchase Program | 12 Months Ended |
Dec. 31, 2018 | |
Accelerated Share Repurchases [Line Items] | |
Share Repurchase Program | 12. Share Repurchase Program On October 28, 2015, Solitario’s Board of Directors approved a share repurchase program that authorized Solitario to purchase up to two million shares of its outstanding common stock. During 2018 Solitario’s Board of Directors extended the expiration date of the share repurchase program through December 31, 2019. During the years ended December 31, 2018 and 2017, Solitario purchased 263,100 and 47,200 shares of Solitario common stock, respectively, for an aggregate purchase price of $101,000 and $32,000, respectively. As of December 31, 2018, Solitario has purchased a total of 930,900 shares for an aggregate purchase price of $449,000 under the share repurchase program since its inception. |
Subsequent Event
Subsequent Event | 12 Months Ended |
Dec. 31, 2018 | |
Subsequent Events [Abstract] | |
Subsequent Event | 13. Subsequent Event The financial statements and related disclosures include an evaluation of events leading up through and including February 28, 2019, which is the date the financial statements were issued. On January 22, 2019, Solitario announced the sale of its interests in a retained royalty on the Pedra Branca project in Brazil, a retained royalty on non-producing exploration properties in Mexico, and a royalty on certain non-producing mineral claims in Montana to SilverStream for Cdn$250,000 in cash and a one-year note from SilverStream for Cdn$350,000. |
Business and Summary of Signi_2
Business and Summary of Significan Accounting Policies (Policies) | 12 Months Ended |
Dec. 31, 2018 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
1. Business and Summary of Significant Accounting Policies | 1. Business and Summary of Significant Accounting Policies Business and company formation Solitario Zinc Corp. (“Solitario,” “Company”) is an exploration stage company as defined in 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 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 likely 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. As a result of the Acquisition (defined below), Solitario is now primarily focused on the acquisition and exploration of zinc-related exploration mineral properties. In addition to focusing on its mineral exploration properties and the evaluation of mineral properties, 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 Solitario determines to be favorable to Solitario. Purchase of Zazu On July 12, 2017, Solitario completed the acquisition of Zazu Metals Corp. (“Zazu”) pursuant to a definitive arrangement agreement between Solitario and Zazu (the "Arrangement Agreement") whereby Solitario agreed to acquire all of the issued and outstanding common shares of Zazu (the "Zazu Shares") by way of a statutory plan of arrangement (the "Arrangement") under the Canada Business Corporations Act (in thousands) July 12, 2017 Issuance of 19,788,177 shares of Solitario common stock $13,654 Replacement options 164 Investment banking and transaction costs 782 Convertible debenture due Solitario, cancelled 1,510 Total purchase price $16,110 The Acquisition was treated as an asset purchase. Accordingly, as the purchase of an asset (essentially the interest in the Lik project in Alaska) Solitario capitalized related transaction costs associated with the Acquisition, including the following costs: (in thousands) July 12, 2017 Investment banking fees $552 Legal and accounting costs 196 Other costs and fees 34 Total capitalized transaction costs $782 The purchase price was allocated to the assets and liabilities acquired from Zazu on the date of the Acquisition as follows: (in thousands) July 12, 2017 Cash $974 Other current assets 42 Equipment 100 Mineral property 15,611 Accounts payable (492) Asset retirement obligation – Lik (125) Total purchase price $16,110 The cash transaction costs less the cash acquired are shown as the cash transaction costs for the year ended December 31, 2017 on the consolidated statement of cash flows. Solitario also incurred stock issuance costs of $117,000, related to the Acquisition, which were charged to equity. Solitario has recorded revenue in the past from the sale of mineral property, including the sale on April 26, 2018 of its interest in the royalty on the Yanacocha property (discussed below) and the sale in 2015 of its former interest in Mount Hamilton LLC the owner of its former Mt. Hamilton project (the “Mt. Hamilton Transaction”), and joint venture property payments and the sale of a royalty on its former Mt. Hamilton project. 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. Solitario currently considers its carried interest in the Florida Canyon project and its interest in the Lik project to be its core mineral property assets. Nexa Resources, Ltd. (“Nexa”), Solitario’s joint venture partner, is expected to continue the development and furtherance of the Florida Canyon project and Solitario is monitoring progress at Florida Canyon. Solitario is working with its 50% joint venture partner, Teck American Incorporated, a wholly-owned subsidiary of Teck Resources Limited (both companies are referred to as “Teck”), in the Lik deposit to further the exploration and evaluate potential development plans for the Lik project. As of December 31, 2018, Solitario has significant balances of cash and short-term investments that Solitario anticipates using, in part, to further the development of the Florida Canyon project and the Lik project and to potentially acquire additional mineral property assets. The 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 adopted ASU 2014-09 (defined below under “Recent accounting pronouncements”) on January 1, 2018. ASU 2014-09 primarily impacts revenue recognition based upon the timing of transfer of control of goods and services sold. Historically Solitario has recorded revenue from the sale of exploration mineral properties and joint venture property payments. Solitario’s policy is to recognize revenue from the sale of its exploration mineral properties (those without reserves) on a property by property basis, computed as the cash received and / or collectable receivables less any capitalized cost. Payments received for the sale of exploration property interests that are less than the properties cost are recorded as a reduction of the related property's capitalized cost. In addition, Solitario’s policy is to recognize revenue on any receipts of joint venture property payments in excess of its capitalized costs on a property that Solitario may lease to another mining company. Solitario has recognized revenue during 2018 for the first time in more than five years from the sale of an exploration mineral property, and expects, any property sales in the future to also be on an infrequent basis. The last proceeds from joint venture property payments was in 2015 and Solitario does not expect to record joint venture property payments on any of its currently held properties for the foreseeable future. Historically, Solitario’s revenues have been infrequent and significant individual transactions and have only been from sales to well known or vetted mining companies. Solitario has never had a return on any of its sales recorded as revenue in its history and does not anticipate it will recognize any estimated returns on its current or future recorded revenues. The adoption of ASU 2014-09 had no impact on Solitario’s recorded revenues for the year ended December 31, 2018 or 2017. Solitario recorded the revenue of $502,000 from the sale of the Yanacocha Royalty in accordance with ASU 2014-09. 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; and (v) Solitario's investment in marketable equity securities. 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 and cash equivalents Cash equivalents include investments in highly liquid money-market securities with original maturities of three months or less when purchased. At December 31, 2018, approximately $113,000 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 At December 31, 2018, Solitario has United States Treasury securities (“USTS”) with maturities of 15 days to 22 months recorded at their fair value of $9,345,000. At December 31, 2018, Solitario has $500,000 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, 2018, the CDs have maturities of three months. In addition, Solitario has a US dollar bank savings account in Peru with a fair value of $378,000. 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. (“Vendetta”) units, including the Vendetta Warrants (defined below) during 2016. During 2017, Solitario exercised all of its Vendetta Warrants and at December 31, 2018 and 2017 has no Vendetta Warrants. Changes in fair value of the Vendetta Warrants are recognized in the statements 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 statements of operations in the period of the change as gain or loss on derivative instruments. Fair value Financial Accounting Standards Board 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. See Note 8, “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 as unrealized gain or loss in the statement of operations. A decline in fair value that is considered other than temporary 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 2018 and 2017 were conducted primarily in Peru, a portion of the payments for the land, leasehold and exploration agreements as well as certain exploration activities 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 6, “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, 2018 and 2017. Potentially dilutive shares, consisting of outstanding common stock options for 5,223,160 and 1,982,428, respectively, Solitario common shares were excluded from the calculation of diluted earnings (loss) per share for the year ended December 31, 2018 and 2017 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 10, “Employee Stock Compensation Plans,” below. Recently adopted accounting pronouncements In January 2016 the FASB issued ASU 2016-01, “Financial Instruments – Overall (subtopic 825-10) Recognition and Measurement of Financial Assets and Liabilities,” (“ASU 2016-01”) . In May 2014, the FASB issued ASU No. 2014-09, Revenue from Contracts with Customers (Topic 606): Recently issued accounting pronouncements In February 2016, the FASB issued Accounting Standards Updated (“ASU”) 2016-02, “Leases” (“ASU 2016-02”). The new standard establishes a right-of-use (ROU) model that requires a lessee to record a ROU asset and a lease liability on the balance sheet for all leases with terms longer than 12 months. Leases will be classified as either finance or operating, with classification affecting the pattern of expense recognition in the income statement. The new standard is effective for interim and annual periods beginning after December 15, 2018. The new rules will be effective for Solitario in the first quarter of 2019. Solitario expect the adoption of ASU 2016-02 to materially change net income or total expense in the statement of operations from its current accounting methods and has estimated it will record an asset and offsetting liability of approximately $80,000 in the consolidated balance sheet upon adoption of ASU 2016-02 in January 2019. The FASB issued ASU No. 2016-13, Financial Instruments – Credit Losses (Topic 326): Measurements of Credit Losses on Financial Statements . In February 2018, the FASB issued ASU 2018-02, “Reclassification of Certain Tax Effects from Accumulated Other Comprehensive Income” (ASU 2018-02”), which allows for a reclassification from accumulated other comprehensive income or loss to retained earnings or accumulated deficit for stranded tax effects resulting from the Tax Cuts and Jobs Act of 2017 (“TCJA”). ASU 2018-02 also requires certain related disclosures. ASU 2018-02 is effective for annual periods, and interim periods within those annual periods, beginning after December 15, 2018 and should be applied either in the period of adoption or retrospectively to each period in which the effect of the change in the U.S. federal corporate income tax rate in the TCJA is recognized. Early adoption is permitted. Solitario does not expect the adoption of ASU 2018-02 will have a material effect on Solitario’s financial position or results of operations. |
Business and Summary of Signi_3
Business and Summary of Significan Accounting Policies (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Results of Operations Zazu | (in thousands) July 12, 2017 Issuance of 19,788,177 shares of Solitario common stock $13,654 Replacement options 164 Investment banking and transaction costs 782 Convertible debenture due Solitario, cancelled 1,510 Total purchase price $16,110 |
Capitalized Transaction Costs Associated with Acquisition | (in thousands) July 12, 2017 Investment banking fees $552 Legal and accounting costs 196 Other costs and fees 34 Total capitalized transaction costs $782 |
Purchase Price Allocated to Assets and Liabilities Acquired | (in thousands) July 12, 2017 Cash $974 Other current assets 42 Equipment 100 Mineral property 15,611 Accounts payable (492) Asset retirement obligation – Lik (125) Total purchase price $16,110 |
Mineral Properties (Tables)
Mineral Properties (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Extractive Industries [Abstract] | |
Capitalized Investment in Mineral Properties | (in thousands) December 31, 2018 2017 Exploration Lik project (Alaska – US) $15,611 $15,611 La Promesa (Peru) 6 6 Montana Royalty property (US) 40 40 Total exploration mineral property $15,657 $15,657 |
Exploration Expense | For the year ended December 31, (in thousands) 2018 2017 Geologic and field expenses $1,165 $447 Administrative 89 252 Total exploration expense $1,254 $699 |
Marketable Equity Securities (T
Marketable Equity Securities (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Marketable Securities [Abstract] | |
Marketable Equity Securities and Adjustments to Fair Value | (in thousands) Year ended 2018 2017 Marketable equity securities at cost $1,714 $1,714 Cumulative unrealized (loss) gain on marketable equity securities (129) 929 Marketable equity securities at fair value $1,585 $2,643 |
Changes in Marketable Equity Securities | (in thousands) Year ended 2018 2017 Cost of marketable equity securities sold $ - $ 88 Realized gain on marketable equity securities sold - 578 Proceeds from the sale of marketable equity securities sold - (666) Purchase of marketable equity securities - 1,528 Gross (loss) gain on marketable equity securities (1,058) 442 Change in marketable equity securities at fair value $(1,058) $ 1,304 |
Realized and Unrealized Gain (Loss) on Marketable Equity Securities | (in thousands) Year ended 2018 2017 Gross (loss) gain on marketable securities $(1,058) $442 Realized gain on marketable equity securities sold - (578) Unrealized (loss) on marketable equity securities $(1,058) $(136) |
Other Assets (Tables)
Other Assets (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract] | |
Other Assets | (in thousands) December 31, 2018 2017 Furniture and fixtures, net of accumulated depreciation $ 36 $ 31 Lik project equipment, net of accumulated depreciation 70 90 Exploration bonds and other assets 4 4 Total other assets $110 $125 |
Income Taxes (Tables)
Income Taxes (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Income Tax Disclosure [Abstract] | |
Deferred Tax Assets and Liabilities | (in thousands) 2018 2017 Deferred tax assets: Loss carryovers $12,432 $12,178 Investment in Mineral Property 1,669 1,952 Capitalized Exploration Costs 877 1,205 Stock option compensation expense 150 13 Royalty - 989 Unrealized loss on derivative securities 60 28 Other 135 135 Valuation allowance (15,099) (16,249) Total deferred tax assets 224 251 Deferred tax liabilities: Unrealized gain on derivative securities - - Unrealized gains on marketable equity securities 209 230 Other 15 21 Total deferred tax liabilities 224 251 Net deferred tax liabilities $ - $ - |
Income Tax from Continuing Operations | (in thousands) 2018 2017 Expected income tax benefit $(756) $(355) Equity based compensation - - Foreign tax rate differences (27) 17 State income tax (143) (27) Impact of Tax Legislation - 4,494 Adjustment to Deferred Taxes 2,058 - Change in Tax Rate 53 - Change in valuation allowance (1,164) (4,120) Permanent differences and other (21) (9) Income tax (benefit) expense $ - $ - |
Derivative Instruments (Tables)
Derivative Instruments (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Gain on Derivative Instruments | (in thousands) Year ended December 31, 2018 2017 Gain on Kinross calls $ - $ 55 Gain on Vendetta Warrants - 216 $ - $271 |
Fair Value of Financial Instr_2
Fair Value of Financial Instruments (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Fair Value Disclosures [Abstract] | |
Financial Assets and Liabilities Measured at Fair Value | (in thousands) Level 1 Level 2 Level 3 Total Assets Short-term investments $10,223 $ - $ - $10,223 Marketable equity securities $ 1,585 $ - $ - $ 1,585 (in thousands) Level 1 Level 2 Level 3 Total Assets Short-term investments $11,642 $ - $ - $11,642 Marketable equity securities $ 2,643 $ - $ - $ 2,643 |
Employee Stock Compensation P_2
Employee Stock Compensation Plans (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Grant Date Fair Value 2013 Plan | Grant Date 1/02/18 (1) 11/01/18 (2) Option – grant date price $0.62 $0.31 Options granted 100,000 1,623,000 Expected life years 0.80 5.00 Expected volatility 66% 64% Risk free interest rate 1.0% 3.0% Weighted average fair value $0.12 $0.17 Grant date fair value $12,000 $282,000 Grant Date 7/12/17 (1) 7/12/17 (1) 7/12/17 (1) 7/12/17 (1) 9/01/17 (2) 9/01/17 (3) Option – grant date price $1.74 $1.52 $1.30 $0.54 $0.77 $0.77 Options granted 357,200 425,068 785,840 214,320 200,000 2,300,000 Expected life years 0.84 1.35 1.50 1.50 5.0 5.0 Expected volatility 67% 67% 67% 67% 64% 64% Risk free interest rate 1.0% 1.0% 1.0% 1.0% 1.7% 1.7% Weighted average fair value $0.02 $0.08 $0.12 $0.36 $0.42 $0.42 Grant date fair value $7,000 $26,000 $72,000 $59,000 $126,000 $970,000 |
Summary Stock Options Outstanding | 2018 2017 Weighted Weighted Average Aggregate Average Aggregate RSUs/ Exercise Intrinsic RSUs/ Exercise Intrinsic Options Price Value (1) Options Price Value (2) Outstanding, beginning of year 1,982,428 $1.29 - - Granted (3) 4,023,000 $0.58 1,982,428 $1.29 Exercised - - - - Expired (782,268) $2.09 - - Forfeited - - - - Outstanding, end of year 5,223,160 $0.76 $ - 1,982,428 $1.29 $9,000 Exercisable, end of year 2,770,910 $0.95 $ - 1,832,428 $1.33 $9,000 |
Business and Summary of Signi_4
Business and Summary of Significan Accounting Policies - Results of Operations Zazu (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2017 | Jul. 12, 2017 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ||
Issuance of 19,788,177 shares of Solitario common stock | $ 13,654 | |
Replacement options | $ 164 | |
Investment banking and transaction costs | $ 782 | |
Convertible debenture due Solitario, cancelled | 1,510 | |
Total purchase price | $ 16,110 |
Business and Summary of Signi_5
Business and Summary of Significan Accounting Policies - Capitalized Transaction Costs Associated with Acquisition (Details) $ in Thousands | 12 Months Ended |
Dec. 31, 2017USD ($) | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Investment banking fees | $ 552 |
Legal and accounting costs | 196 |
Other costs and fees | 34 |
Total capitalized transaction costs | $ 782 |
Business and Summary of Signi_6
Business and Summary of Significan Accounting Policies - Purchase Price Allocated to Assets and Liabilities Acquired (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2017 | Jul. 12, 2017 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ||
Cash | $ 974 | |
Other current assets | 42 | |
Equipment | 100 | |
Mineral property | 15,611 | |
Accounts payable | (492) | |
Asset retirement obligation Lik | $ (125) | |
Total purchase price | $ 16,110 |
Business and Summary of Signi_7
Business and Summary of Significan Accounting Policies (Details Narrative) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |||
Mar. 31, 2019 | Mar. 31, 2018 | Dec. 31, 2018 | Dec. 31, 2017 | Jul. 12, 2017 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |||||
Common stock issued at .3572 shares for 1 share Zazu | 19,788,177 | ||||
Replacement options issued to Zazu | 1,782,428 | ||||
Total purchase price Zazu Acquisition | $ 16,110 | ||||
Stock issuance costs related to Zazu | $ 117 | ||||
Cash and equivalents not covered under FDIC | $ 113 | ||||
United States Treasuries | 9,345 | ||||
Certificates of Deposit | 500 | ||||
US dollar savings account in Peru | $ 378 | ||||
Potentially dilutive shares consisting of stock options | 5,223,160 | 1,982,428 | |||
Cumulative effect adjustment for change in accounting principle | $ 576 | ||||
Unrealized loss on marketable equity securities | $ 1,058 | ||||
Asset and offsetting liability upon adoption of ASU 2016-02 | $ 80 |
Mineral Properties - Capitalize
Mineral Properties - Capitalized Investment in Mineral Properties (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2018 | Dec. 31, 2017 | |
Lik project (Alaska US) | ||
Capitalized Investment Mineral Properties | $ 15,611 | $ 15,611 |
La Promesa (Peru) | ||
Capitalized Investment Mineral Properties | 6 | 6 |
Montana Royalty property (US) | ||
Capitalized Investment Mineral Properties | $ 40 | $ 40 |
Mineral Properties - Exploratio
Mineral Properties - Exploration Expense (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2018 | Dec. 31, 2017 | |
Extractive Industries [Abstract] | ||
Geologic and field expenses | $ 1,165 | $ 447 |
Administrative | 89 | 252 |
Total exploration expense | $ 1,254 | $ 699 |
Marketable Equity Securities an
Marketable Equity Securities and Adjustments to Fair Value (Details) - USD ($) $ in Thousands | Dec. 31, 2018 | Dec. 31, 2017 |
Marketable Securities [Abstract] | ||
Marketable equity securities at cost | $ 1,714 | $ 1,714 |
Cumulative unrealized (loss) gain on marketable equity securities | (129) | 929 |
Marketable equity securities at fair value | $ 1,585 | $ 2,643 |
Changes in Marketable Equity Se
Changes in Marketable Equity Securities (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2018 | Dec. 31, 2017 | |
Marketable Securities [Abstract] | ||
Cost of marketable equity securities sold | $ 88 | |
Realized gain on marketable equity securities sold | 578 | |
Proceeds from the sale of marketable equity securities sold | (666) | |
Purchase of marketable equity securities | 1,528 | |
Gross (loss) gain on marketable equity securities | (1,058) | 442 |
Change in marketable equity securities at fair value | $ (1,058) | $ 1,304 |
Realized and Unrealized Gain (L
Realized and Unrealized Gain (Loss) on Marketable Equity Securities (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2018 | Dec. 31, 2017 | |
Marketable Securities [Abstract] | ||
Gross (loss) gain on marketable securities | $ (1,058) | $ 442 |
Realized gain on marketable equity securities sold | (578) | |
Unrealized (loss) on marketable equity securities | $ (1,058) | $ (136) |
Marketable Equity Securities (D
Marketable Equity Securities (Details Narrative) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2018 | May 02, 2016 | |
Marketable Securities [Abstract] | |||
Units Vendetta purchased | 7,240,000 | ||
Aggregate consideration for units of Vendetta (common stock $186,000; Warrants $103,000) | $ 289 | ||
Common shares Vendetta sold | 3,480,000 | ||
Vendetta shares owned | 11,000,000 | ||
Proceeds from sale of Vendetta | $ 666 | ||
Value Vendetta warrants (exercise date) | 950 | ||
Cash paid to exercise Vendetta warrants | $ 578 |
Other Assets - Other Assets (De
Other Assets - Other Assets (Details) - USD ($) $ in Thousands | Dec. 31, 2018 | Dec. 31, 2017 |
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract] | ||
Furniture and fixtures, net of accumulated depreciation | $ 36 | $ 31 |
Lik project equipment, net of accumulated depreciation | 70 | 90 |
Exploration bonds and other assets | 4 | 4 |
Total other assets | $ 110 | $ 125 |
Other Assets (Details Narrative
Other Assets (Details Narrative) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2018 | Dec. 31, 2017 | |
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract] | ||
Acquisition of exploration related equipment | $ 100 | |
Depreciation expense recorded | $ 20 | 10 |
Gain on derivative instruments related to Vendetta Warrants | $ 216 |
Revenue Mineral Property Sale (
Revenue Mineral Property Sale (Details Narrative) $ in Thousands | Apr. 26, 2018USD ($) |
Notes to Financial Statements | |
Sale of Yanacocha royalty interest | $ 502 |
Income Taxes - Deferred Tax Ass
Income Taxes - Deferred Tax Assets and Liabilities (Details) - USD ($) $ in Thousands | Dec. 31, 2018 | Dec. 31, 2017 |
Deferred tax assets: | ||
Loss carryovers | $ 12,432 | $ 12,178 |
Investment in Mineral Property | 1,669 | 1,952 |
Capitalized Exploration Costs | 877 | 1,205 |
Stock option compensation expense | 150 | 13 |
Royalty | 989 | |
Unrealized loss on derivative securities | 60 | 28 |
Other | 135 | 135 |
Valuation allowance | (15,099) | (16,249) |
Total deferred tax assets | 224 | 251 |
Deferred tax liabilities: | ||
Unrealized gain on derivative securities | ||
Unrealized gains on marketable equity securities | 209 | 230 |
Other | 15 | 21 |
Total deferred tax liabilities | 224 | 251 |
Net deferred tax liabilities |
Income Taxes - Income Tax from
Income Taxes - Income Tax from Continuing Operations (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2018 | Dec. 31, 2017 | |
Income Tax Disclosure [Abstract] | ||
Expected income tax benefit | $ (756) | $ (355) |
Equity based compensation | ||
Foreign tax rate differences | (27) | 17 |
State income tax | (143) | (27) |
Impact of Tax Legislation | 4,494 | |
Adjustment to Deferred Taxes | 2,058 | |
Change in Tax Rate | 53 | |
Change in valuation allowance | (1,164) | (4,120) |
Permanent differences and other | (21) | (9) |
Income tax (benefit) expense |
Income Taxes (Details Narrative
Income Taxes (Details Narrative) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2018 | Dec. 31, 2017 | |
Income Tax Disclosure [Abstract] | ||
Consolidated loss before income taxes | $ 260 | $ 322 |
Decrease to net deferred tax assets | 4,494 | |
Acquisition of deferred tax assets | 10,366 | |
Unused US NOL carryovers | 15,404 | $ 15,980 |
US Capital Loss carryovers | 11,132 | |
Canadian loss carryforwards | $ 9,205 |
Derivative Instruments - Gain o
Derivative Instruments - Gain on Derivative Instruments (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2018 | Dec. 31, 2017 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | ||
Gain on Kinross calls | $ 55 | |
Gain on Vendetta Warrants | 216 | |
Gain on Derivative Instruments | $ 271 |
Fair Value of Financial Instr_3
Fair Value of Financial Instruments - Financial Assets and Liabilities Measured at Fair Value (Details) - USD ($) $ in Thousands | Dec. 31, 2018 | Dec. 31, 2017 |
Level 1 | ||
Assets | ||
Short-term investments | $ 10,223 | $ 11,642 |
Marketable equity securities | 1,585 | 2,643 |
Level 2 | ||
Assets | ||
Short-term investments | ||
Marketable equity securities | ||
Level 3 | ||
Assets | ||
Short-term investments | ||
Marketable equity securities |
Commitments and Contingencies (
Commitments and Contingencies (Details Narrative) $ in Thousands | 12 Months Ended |
Dec. 31, 2018USD ($) | |
Commitments and Contingencies Disclosure [Abstract] | |
Estimated property rentals and option payments for 2019 | $ 729 |
Reimbursable payments for estimated 2019 payments | 712 |
Non-cancelable operating lease for office space annual payment | 43 |
Funding for drilling Florida Canyon agreement payable in three installments | 1,580 |
Account payable recorded for payment of funding for drilling | 527 |
Exploration expense recorded for payment of funding for drilling | 527 |
Additional payment upon completion of drilling in 2019 | $ 1,053 |
Employee Stock Compensation P_3
Employee Stock Compensation Plans - Grant Date Fair Value 2013 Plan (Details) - $ / shares | 12 Months Ended | |||||
Dec. 31, 2018 | Dec. 31, 2017 | Nov. 01, 2018 | Jan. 02, 2018 | Sep. 01, 2017 | Jul. 12, 2017 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | ||||||
Option – grant date price | $ 0.31 | $ 0.62 | $ .77 | $ 1.35 | ||
Options granted | 1,623,000 | 100,000 | 2,500,000 | 1,782,428 | ||
Expected life years | 5 years | 6 years | ||||
Expected volatility | 65.00% | 65.00% | ||||
Risk free interest rate | 3.00% | 1.00% | 1.70% | 1.00% | ||
Weighted average fair value | $ 0.17 | $ 0.12 | $ .42 | $ 0.15 | ||
Grant date fair value | $ 282,000 | $ 12,000 | $ 548,000 | $ 41,000 |
Employee Stock Compensation P_4
Employee Stock Compensation Plans - Summary Stock Options Outstanding (Details) - USD ($) $ / shares in Units, $ in Thousands | 12 Months Ended | |
Dec. 31, 2018 | Dec. 31, 2017 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | ||
Outstanding, beginning of year | 1,982,428 | |
Outstanding, beginning of year, Per Share | $ 1.29 | |
Granted (3) | 4,023,000 | 1,982,428 |
Granted, Per Share | $ .58 | $ 1.29 |
Exercised | ||
Expired | (782,268) | |
Expired, Per Share | $ 2.09 | |
Outstanding, end of year | 5,223,160 | 1,982,428 |
Outstanding, end of year, Per Share | $ .76 | $ 1.29 |
Exercisable, end of year | 2,770,910 | 1,832,428 |
Exercisable, end of year, Per Share | $ .95 | $ 1.33 |
Aggregate Intrinsic Value (2) | $ 9 |
Employee Stock Compensation P_5
Employee Stock Compensation Plans (Details Narrative) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Jun. 08, 2013 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |||
Total shares available for awards in 2013 Plan, as amended | 5,750,000 | ||
Conditional options granted during 2018 | 2,300,000 | ||
Stock option expenses recorded | $ 660 | $ 50 | |
Unrecognized stock option compensation cost related to non-vested options | $ 639 |
Share Repurchase Program (Detai
Share Repurchase Program (Details Narrative) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Oct. 28, 2015 | |
Accelerated Share Repurchases [Line Items] | |||
Shares authorized for repurchase | 2,000,000 | ||
Shares repurchased | 263,100 | 47,200 | |
Aggregate repurchase price shares repurchased | $ 101 | $ 32 | |
Total shares repurchased since program's inception | 930,900 | ||
Aggregate price of shares repurchased since program's inception | $ 449 |
Subsequent Event (Details Narra
Subsequent Event (Details Narrative) $ in Thousands | Jan. 22, 2019USD ($) |
Subsequent Events [Abstract] | |
Sale of interests in retained royalty (CDN $) | $ 250 |
One-year note for sale of retained royalty (CDN $) | $ 350 |