Document and Entity Information
Document and Entity Information - shares | 3 Months Ended | |
Mar. 31, 2020 | Apr. 30, 2020 | |
Document And Entity Information | ||
Entity Registrant Name | SOLITARIO ZINC CORP. | |
Entity Central Index Key | 0000917225 | |
Document Type | 10-Q/A | |
Document Period End Date | Mar. 31, 2020 | |
Amendment Flag | true | |
Amendment Description | The amendment is being filed to update information in the document. | |
Current Fiscal Year End Date | --12-31 | |
Is Entity's Reporting Status Current? | Yes | |
Is Entity a Shell Company? | false | |
Is Entity Emerging Growth Company? | false | |
Entity Filer Category | Non-accelerated Filer | |
Entity Small Business | true | |
Entity Common Stock, Shares Outstanding | 58,116,366 | |
Document Fiscal Period Focus | Q1 | |
Document Fiscal Year Focus | 2020 | |
Entity Interactive Data Current | Yes | |
Entity Incorporation State Country Code | CO | |
Entity File Number | 001-39278 |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets - USD ($) $ in Thousands | Mar. 31, 2020 | Dec. 31, 2019 |
Current assets: | ||
Cash and cash equivalents | $ 440 | $ 574 |
Short-term investments | 6,829 | 6,829 |
Investments in marketable equity securities, at fair value | 755 | 1,039 |
SilverStream note receivable | 253 | 268 |
Prepaid expenses and other | 42 | 46 |
Total current assets | 8,319 | 8,756 |
Mineral properties | 15,617 | 15,617 |
Other assets | 136 | 159 |
Total assets | 24,072 | 24,532 |
Current liabilities: | ||
Accounts payable | 294 | 228 |
Operating lease liability | 38 | 41 |
Kinross call options | 9 | 0 |
Total current liabilities | 341 | 269 |
Long-term liabilities | ||
Asset retirement obligation - Lik | 125 | 125 |
Operating lease liability | 0 | 7 |
Total long-term liabilities | 125 | 132 |
Shareholders' equity: | ||
Preferred stock, $0.01 par value, authorized 10,000,000 shares (none issued and outstanding at March 31, 2020 and December 31, 2019) | 0 | 0 |
Common stock, $0.01 par value, authorized 100,000,000 shares (58,116,366 and 58,133,066 shares, respectively, issued and outstanding at March 31, 2020 and December 31, 2019 | 581 | 581 |
Additional paid-in capital | 70,286 | 70,204 |
Accumulated deficit | (47,261) | (46,654) |
Total shareholders' equity | 23,606 | 24,131 |
Total liabilities and shareholders' equity | $ 24,072 | $ 24,532 |
Condensed Consolidated Balanc_2
Condensed Consolidated Balance Sheets (Parenthetical) - $ / shares | Mar. 31, 2020 | Dec. 31, 2019 |
Preferred stock | ||
Preferred stock, par value | $ .01 | $ 0.01 |
Preferred stock, shares authorized | 10,000,000 | 10,000,000 |
Preferred stock, shares issued | 0 | 0 |
Preferred stock, shares outstanding | 0 | 0 |
Common stock | ||
Common stock, par value | $ 0.01 | $ 0.01 |
Common stock, shares authorized | 100,000,000 | 100,000,000 |
Common stock, shares issued | 58,116,366 | 58,133,066 |
Common stock, shares outstanding | 58,116,366 | 58,133,066 |
Condensed Consolidated Statemen
Condensed Consolidated Statements of Operations - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Income Statement [Abstract] | ||
Revenue, net - mineral property sale | $ 0 | $ 408 |
Costs, expenses and other: | ||
Exploration expense | 113 | 163 |
Depreciation | 6 | 7 |
General and administrative | 336 | 425 |
Total costs, expenses and other | 455 | 595 |
Interest income, net | 81 | 72 |
Loss on derivative instruments | (25) | 0 |
Gain on sale of marketable equity securities | 25 | 0 |
Unrealized loss on marketable equity securities | (233) | (326) |
Total other loss | (152) | (254) |
Net loss | $ (607) | $ (441) |
Loss per common share: | ||
Basic and diluted | $ (0.01) | $ (0.01) |
Weighted average shares outstanding: | ||
Basic and diluted | 58,130 | 58,158 |
Condensed Consolidated Statem_2
Condensed Consolidated Statements of Cash Flows - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Operating activities: | ||
Net loss | $ (607) | $ (441) |
Adjustments to reconcile net loss to net cash used in operating activities: | ||
Depreciation and amortization | 6 | 7 |
Amortization of right of use lease asset | 10 | 10 |
Unrealized loss on marketable equity securities | 233 | 326 |
Employee stock option expense | 85 | 88 |
Gain on sale of marketable equity securities | (25) | 0 |
Loss on derivative instruments | 25 | 0 |
Changes in operating assets and liabilities: | ||
Prepaid expenses and other assets | (21) | 64 |
Note receivable, net of mineral property sold | 0 | (223) |
Accounts payable and other current liabilities | 56 | (3) |
Net cash used in operating activities | (238) | (172) |
Investing activities: | ||
Sale of short-term investments, net | 40 | 602 |
Cash from sale of marketable equity securities | 76 | 0 |
Purchase (sale) of derivative instruments - net | (9) | 0 |
Net cash provided by investing activities | 107 | 602 |
Financing activities: | ||
Purchase of common stock for cancellation | (3) | (9) |
Net cash used in financing activities | (3) | (9) |
Net increase (decrease) in cash and cash equivalents | (134) | 421 |
Cash and cash equivalents, beginning of period | 574 | 117 |
Cash and cash equivalents, end of period | $ 440 | $ 538 |
Business and Significant Accoun
Business and Significant Accounting Policies | 3 Months Ended |
Mar. 31, 2020 | |
Accounting Policies [Abstract] | |
Business and Significant Accounting Policies | Business and company formation Solitario Zinc Corp. (“Solitario,” or the “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 or royalties and/or discover economic deposits on its mineral properties and advance these deposits, either on its own or through joint ventures, up to the development stage. At that point, or sometime prior to that point, Solitario would 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. Solitario is primarily focused on the acquisition and exploration of zinc-related exploration mineral properties; however Solitario will evaluate and acquire other base and precious metal mineral exploration properties. In addition to focusing on its mineral exploration properties and the evaluation of mineral properties for acquisition, Solitario also evaluates potential strategic transactions for the acquisition of new precious and base metal properties and assets with exploration potential or business combinations that Solitario determines to be favorable to Solitario. Solitario has recorded revenue in the past from the sale of mineral property, including (i) the sale of certain mineral royalty properties to SilverStream SEZC, a private Cayman Island royalty and streaming company (“SilverStream”) for Cdn$600,000 in January 2019 (the “Royalty Sale”), and (ii) the sale in June 2018 of its interest in the royalty on its Yanacocha property. In addition, Solitario has received proceeds from (i) the sale in 2015 of its former interest in Mount Hamilton LLC (“MH-LLC”), the owner of its former Mt. Hamilton project; (ii) the sale of a royalty on its former Mt. Hamilton project and (iii) joint venture property payments. Revenues and / or proceeds from the sale or joint venture of properties or assets, although significant when they occur, have not been a consistent annual source of cash 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 in Peru and its interest in the Lik project in Alaska to be its core mineral property assets. Nexa Resources, Ltd. (“Nexa”), Solitario’s joint venture partner, is expected to continue the exploration and furtherance of the Florida Canyon project and Solitario is monitoring progress at Florida Canyon. Solitario is working with its 50% joint venture partner in the Lik deposit, Teck American Incorporated, a wholly-owned subsidiary of Teck Resources Limited (both companies are referred to as “Teck”), to further the exploration and evaluate potential development plans for the Lik project. As of March 31, 2020, Solitario has significant balances of cash and short-term investments that Solitario anticipates using, in part, to fund costs and activities intended to further the exploration of the Florida Canyon and Lik projects and to potentially acquire additional mineral property assets. The fluctuations in precious metal and other commodity prices contribute to a challenging environment for mineral exploration and development, which has created opportunities as well as challenges for the potential acquisition of early-stage and advanced mineral exploration projects or other related assets at potentially attractive terms. The accompanying interim condensed consolidated financial statements of Solitario for the three months ended March 31, 2020 are unaudited and are prepared in accordance with accounting principles generally accepted in the United States of America (“generally accepted accounting principles”). They do not include all disclosures required by generally accepted accounting principles for annual financial statements, but in the opinion of management, include all adjustments necessary for a fair presentation. Interim results are not necessarily indicative of results, which may be achieved in the future, or for the full year ending December 31, 2020. These financial statements should be read in conjunction with the financial statements and notes thereto which are included in Solitario’s Annual Report on Form 10-K for the year ended December 31, 2019. The accounting policies set forth in those annual financial statements are the same as the accounting policies utilized in the preparation of these financial statements, except as modified for appropriate interim financial statement presentation. Risks and Uncertainties Solitario faces risks related to health epidemics and other outbreaks of communicable diseases, which could significantly disrupt its operations and may materially and adversely affect our business and financial conditions. Solitario’s business could be adversely impacted by the effects of the coronavirus (COVID-19) or other epidemics or pandemics. The extent to which the coronavirus impacts Solitario’s business, including our exploration and other activities and the market for its securities, will depend on future developments, which are highly uncertain and cannot be predicted at this time, and include the duration, severity and scope of the outbreak and the actions taken to contain or treat the coronavirus outbreak. Solitario has taken steps to conserve its financial resources including reducing costs, in response to the economic uncertainty associated with these risks. See Item 1A “Risk Factors” below. 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 generally accepted accounting principles and are expressed in U.S. dollars. Revenue recognition 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 the three months ended March 31, 2019 of $408,000 related to the Royalty Sale in accordance with Accounting Standards Codification (“ASC”) 606. Solitario expects any property, royalty or asset sales in the future to be on an infrequent basis. 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. Use of estimates The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. Some of the more significant estimates included in the preparation of Solitario's financial statements pertain to: (i) the recoverability of mineral properties related to its mineral exploration properties and their future exploration potential; (ii) the fair value of stock option grants to employees; (iii) the ability of Solitario to realize its deferred tax assets; (iv) Solitario's investment in marketable equity securities; and (v) the collectability of the SilverStream Note (as defined below). 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 or its joint venture partners to obtain the necessary permits and financing to successfully place the properties into production, and upon future profitable operations, none of which is assured. Cash equivalents Cash equivalents include investments in highly liquid money-market securities with original maturities of three months or less when purchased. As of March 31, 2020, $425,000 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 As of March 31, 2020, Solitario has $6,325,000 of its current assets in United States Treasury Securities (“USTS”) with maturities of 15 days to 15 months. In addition, Solitario has two bank certificates of deposits (“CD’s”) each with a face value of $250,000. The USTS and CD’s are recorded at their fair value, based upon quoted market prices. The USTS are not covered under the FDIC insurance rules for United States deposits. Solitario’s USTS and CD’s 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. Leases Solitario accounts for its leases in accordance with ASC 842, Leases Derivative instruments Solitario accounts for its derivative instruments in accordance with ASC 815. Fair value ASC 820 established a framework for measuring fair value of financial instruments and required disclosures about fair value measurements. 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 CD’s, 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 6, “Fair Value,” below. Marketable equity securities Solitario's investments in marketable equity securities are carried at fair value, which is based upon quoted prices of the securities owned. Solitario records investments in marketable equity securities 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 condensed consolidated statement 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 2019 and the first quarter of 2020 were conducted primarily in Peru, a portion of the payments under land, leasehold and exploration agreements of Solitario are denominated in United States dollars. Realized 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. 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 three months ended March 31, 2020 and 2019. Potentially dilutive shares related to outstanding common stock options of 4,373,000 and 4,373,000, respectively, for Solitario common shares for the three months ended March 31, 2020 and 2019 were excluded from the calculation of diluted loss per share because the effects were anti-dilutive. Employee stock compensation and incentive plans Solitario classifies all of its stock options as equity options in accordance with the provisions of ASC 718, “Compensation – Stock Compensation.” Recently adopted accounting pronouncements The Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2016-13, Financial Instruments – Credit Losses (Topic 326): Measurements of Credit Losses on Financial Statements . The FASB issued ASU No. 2018-13, Disclosure Framework – Fair Value (topic 820): Changes to Disclosure Requirements for Fair Value Measurement . Recently issued accounting pronouncements The SEC has adopted amendments to its disclosure rules to modernize the mineral property disclosure requirements for issuers whose securities are registered with the SEC. These amendments became effective February 25, 2019 (the “SEC Modernization Rules”) and, following a two-year transition period, the SEC Modernization Rules will replace the historical property disclosure requirements for mining registrants that are included in SEC Industry Guide 7. Under the SEC Modernization Rules, consistent with global standards as embodied by the Committee for Reserves International Reporting Standards (“CRIRSCO”), registrants will be required to disclose specified information concerning mineral resources that have been identified on one or more of its mineral properties. Consistent with CRIRSCO standards the SEC Modernization Rules have added definitions to recognize “Measured Mineral Resources”, “Indicated Mineral Resources” and “Inferred Mineral Resources.” The Company is not required to provide disclosure on its mineral properties under the SEC Modernization Rules until its fiscal year beginning January 1, 2021. Upon adoption of the SEC Modernization Rules, among other requirements, the Company will be required to report its mineral resources, if any, as Measured, Indicated or Inferred Mineral Resources in accordance with the SEC Modernization Rules. This will allow investors to evaluate the Company’s resources on a comparable basis with other mining and exploration issuers registered with the SEC. In addition, the SEC Modernization Rules will require the Company to disclose exploration results, mineral reserves, if any, and mineral resources based upon information and supporting documentation prepared by a mining expert (the “qualified person”). The SEC Modernization Rules will require the Company to obtain a dated and signed technical report summary from the qualified person identifying and summarizing the information reviewed and conclusions reached by the qualified person(s) about the mineral resources or reserves for each mineral property. The Company is currently evaluating the requirements under the SEC Modernization Rules and has not determined what effect adoption will have on its consolidated financial statements and disclosures. |
Mineral Property
Mineral Property | 3 Months Ended |
Mar. 31, 2020 | |
Extractive Industries [Abstract] | |
Mineral Property | The following table details Solitario’s investment in Mineral Property: (in thousands) March 31, December 31, 2020 2019 Exploration Lik project (Alaska – US) $ 15,611 $ 15,611 La Promesa (Peru) 6 6 Total exploration mineral property $ 15,617 $ 15,617 All exploration costs on our exploration properties, none of which have proven and probable reserves, including any additional costs incurred for subsequent lease payments or exploration activities related to our projects are expensed as incurred. Royalty sale On January 22, 2019, Solitario completed the Royalty Sale to SilverStream for Cdn$600,000. On closing of the Royalty Sale, Solitario received Cdn$250,000 in cash and a convertible note from SilverStream in the principal amount of Cdn$350,000 (the “SilverStream Note”). The SilverStream Note was originally due December 31, 2019, accrued 5% per annum simple interest, payable on a quarterly basis, and is convertible into common shares of SilverStream, at the discretion of SilverStream, by providing Solitario a notice of conversion. In December of 2019, Solitario and SilverStream agreed to extend the due date of the SilverStream Note to June 30, 2020, and to increase the interest rate to 8% per annum simple interest. All other terms of the SilverStream Note remained the same. During the three months ended March 31, 2020 and 2019, Solitario recorded interest income from the SilverStream Note of $5,000 and $2,000, respectively. During the three months ended March 31, 2019, Solitario recorded mineral property revenue of $408,000 from the Royalty Sale, consisting of the fair value of the cash received on the date of the sale of $185,000 and the fair value of the SilverStream Note on the date of the sale of $263,000 less the carrying value of the royalties sold of $40,000. Exploration expense The following items comprised exploration expense: (in thousands) Three months ended March 31, 2020 2019 Geologic and field expenses $ 90 $ 147 Administrative 23 16 Total exploration costs $ 113 $ 163 Asset Retirement Obligation In connection with the acquisition of the Lik project in 2017, 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 purchased 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 | 3 Months Ended |
Mar. 31, 2020 | |
Investments, Debt and Equity Securities [Abstract] | |
Marketable Equity Securities | Solitario's investments in marketable equity securities are carried at fair value, which is based upon quoted prices of the securities owned. The cost of marketable equity securities sold is determined by the specific identification method. Changes in market value are recorded in the condensed consolidated statement of operations. During the three months ended March 31, 2020, Solitario recorded an unrealized loss on marketable equity securities of $233,000. During the three months ended March 31, 2019, Solitario recorded an unrealized loss on marketable equity securities of $326,000. The following tables summarize Solitario’s marketable equity securities and adjustments to fair value: (in thousands) March 31, 2020 December 31, 2019 Marketable equity securities at cost $ 1,828 $ 1,879 Cumulative unrealized loss on marketable equity securities (1,073 ) (840 ) Marketable equity securities at fair value $ 755 $ 1,039 The following table represents changes in marketable equity securities during the three months ended March 31, 2020 and 2019: (in thousands) Three months ended March 31, 2020 2019 Cost of marketable equity securities sold $ 51 $ - Realized gain on marketable equity securities sold 25 - Proceeds from the sale of marketable equity securities sold (76 ) - Net loss on marketable equity securities (208 ) (326 ) Change in marketable equity securities at fair value $ (284 ) $ (326 ) The following table represents the realized and unrealized gain (loss) on marketable equity securities: (in thousands) Three months ended March 31, 2020 2019 Unrealized loss on marketable securities $ (233 ) $ (326 ) Realized gain on marketable equity securities sold 25 - Net loss on marketable securities $ (208 ) $ (326 ) Solitario sold 2,000,000 shares of Vendetta Mining Corp. (“Vendetta”) common stock during the three months ended March 31, 2020 for proceeds of $76,000 and recorded a gain on sale of $25,000 on the date of sale. Solitario did not sell any marketable equity securities during the three months ended March 31, 2019 and the change in the fair value of marketable equity securities was related entirely to the unrealized loss on marketable equity securities related to their fair values based upon quoted market prices for the marketable equity securities held by Solitario during that period. Vendetta Warrants On July 31, 2019, Solitario purchased 3,450,000 Vendetta units for a total of $233,000. Each Vendetta unit consisted of one share of Vendetta common stock and one Vendetta warrant (the “Vendetta Warrants”). Each Vendetta Warrant entitles the holder to purchase one additional share of Vendetta common stock for a purchase price of Cdn$0.13 per share for a period of three years. On the purchase date Solitario recorded marketable equity securities of $165,000 for the Vendetta shares acquired and $68,000 for the Vendetta Warrants based upon an allocation of the purchase price of the Vendetta units, based upon (i) the fair value of the Vendetta common shares received, based upon the quoted market price for Vendetta common shares and (ii) the fair value of Vendetta Warrants based upon a Black Scholes model. During the three months ended March 31, 2020, Solitario charged loss on derivative instruments $7,000 for the change in the fair value of the Vendetta Warrants based on a Black Scholes model. |
Leases
Leases | 3 Months Ended |
Mar. 31, 2020 | |
Leases [Abstract] | |
Leases | Solitario adopted ASU 2016-02 effective January 1, 2019 and accounts for its leases in accordance with ASC 842. Solitario leases one facility, its Wheat Ridge, Colorado office (the “WR Lease”), that has a term of more than one year. Solitario has no other material operating lease costs. The WR Lease is classified as an operating lease and has a term of 11 months at March 31, 2020, with no renewal option. At March 31, 2020, the right-of-use office lease asset for the WR Lease is classified as other assets and the related liability as current office lease liabilities in the condensed consolidated balance sheet. The amortization of right of use lease asset expense is recognized on a straight-line basis over the lease term, with variable lease payments recognized in the period those payments are incurred. During the three months ended March 31, 2020 and 2019, Solitario recognized $10,000 and $10,000, respectively, of non-cash amortization of right of use lease asset expense for the WR Lease included in general and administrative expense. During the three months ended March 31, 2020 and 2019, cash lease payments of $10,000 and $7,000, respectively, were made on the WR Lease. These cash payments, less $1,000 of imputed interest for each period, reduced the related liability on the WR Lease. The discount rate within the WR Lease is not determinable and Solitario has applied a discount rate of 5% based upon Solitario’s estimate of its cost of capital. The maturities of Solitario’s lease liability for its WR Lease are as follows at March 31, 2020: Future lease payments (in thousands) 2020 32 2021 7 Total lease payments 39 Less amount of payments representing interest (1 ) Present value of lease payments $ 38 Supplemental cash flow information related to our operating lease was as follows for the three months ended March 31, 2020 and 2019: (in thousands) Three months ended March 31, 2020 2019 Cash paid for amounts included in the measurement of lease liabilities Operating cash outflows from WR Lease payments $ 10 $ 7 Non-cash amounts related to the WR lease Leased assets recorded in exchange for new operating lease liabilities $ - $ 82 |
Other Assets
Other Assets | 3 Months Ended |
Mar. 31, 2020 | |
Other Assets [Abstract] | |
Other Assets | The following items comprised other assets: (in thousands) March 31, December 31 2020 2019 Furniture and fixtures, net of accumulated depreciation $ 38 $ 39 Lik project equipment, net of accumulated depreciation 45 50 Office lease asset 36 45 Vendetta warrants 13 21 Exploration bonds and other assets 4 4 Total other $ 136 $ 159 |
Fair Value
Fair Value | 3 Months Ended |
Mar. 31, 2020 | |
Fair Value Disclosures [Abstract] | |
Fair Value | Solitario accounts for its financial instruments under ASC 820. For certain of Solitario’s financial instruments, including cash and cash equivalents and payables, the carrying amounts approximate fair value due to their short-term maturities. Solitario’s short-term investments in USTS, CD’s, and marketable equity securities are carried at their estimated fair value primarily based on quoted market prices. During the three months ended March 31, 2020 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 March 31, 2020: (in thousands) Level 1 Level 2 Level 3 Total Assets Short-term investments $ 6,829 $ - $ - $ 6,829 Marketable equity securities $ 755 $ - $ - $ 755 2019 Vendetta Warrants $ - $ 13 $ - $ 13 Liabilities Kinross call options $ 9 $ - $ - $ 9 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, 2019: (in thousands) Level 1 Level 2 Level 3 Total Assets Short-term investments $ 6,829 $ - $ - $ 6,829 Marketable equity securities $ 1,039 $ - $ - $ 1,039 2019 Vendetta Warrants $ - $ 21 $ - $ 21 |
Income Taxes
Income Taxes | 3 Months Ended |
Mar. 31, 2020 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Solitario accounts for income taxes in accordance with 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. At both March 31, 2020 and December 31, 2019, a valuation allowance has been recorded, which fully offsets Solitario’s net deferred tax assets, because it is more likely than not that the Company will not realize some portion or all of its deferred tax assets. The Company continually assesses both positive and negative evidence to determine whether it is more likely than not that the deferred tax assets can be realized prior to their expiration. During the three months ended March 31, 2020 and 2019, Solitario recorded no deferred tax expense. |
Commitments and Contingencies
Commitments and Contingencies | 3 Months Ended |
Mar. 31, 2020 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | 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 rent payments of $39,000 through March of 2021. |
Employee Stock Compensation Pla
Employee Stock Compensation Plans | 3 Months Ended |
Mar. 31, 2020 | |
Share-based Payment Arrangement [Abstract] | |
Employee Stock Compensation Plans | On June 18, 2013, Solitario’s shareholders approved the 2013 Solitario Exploration & Royalty Corp. Omnibus Stock and Incentive Plan (the “2013 Plan”). Under the terms of the 2013 Plan, a total of 1,750,000 shares of Solitario common stock were reserved for awards to directors, officers, employees and consultants. On June 29, 2017, Solitario shareholders approved an amendment to the 2013 Plan, which increased the number of shares of common stock available for issuance under the 2013 Plan from 1,750,000 to 5,750,000. 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. As of both March 31, 2020, and December 31, 2019 there were options outstanding that are exercisable to acquire 4,373,000 shares of Solitario common stock, with exercise prices between $0.28 and $0.77 per share. During the three months ended March 31, 2020, Solitario did not grant any options. During the three months ended March 31, 2019, Solitario granted options exercisable to acquire 150,000 shares of common stock, with an exercise price of $0.28 per share, a five-year term, and a grant date fair value of $23,000 based upon a Black-Scholes model, with a 64% volatility and a 2.4% risk-free interest rate. In addition, during the three months ended March 31, 2019, options exercisable into 1,000,160 shares of common stock, with exercise prices between $1.68 and $0.70 per share, expired unexercised. There were no exercises of options under the 2013 Plan during either of the three months ended March 31, 2020 and 2019. During the three months ended March 31, 2020 and 2019, Solitario recorded stock option compensation expense of $85,000 and $88,000, respectively. At March 31, 2020, the total unrecognized stock option compensation cost related to non-vested options is $232,000 and is expected to be recognized over a weighted average period of 13 months. |
Shareholders' Equity
Shareholders' Equity | 3 Months Ended |
Mar. 31, 2020 | |
Equity [Abstract] | |
Shareholders' Equity | Shareholders’ Equity for the three months ended March 31, 2019: (in thousands, except Share amounts) Common Common Additional Total Stock Stock Paid-in Accumulated Shareholders’ Shares Amount Capital Deficit Equity Balance at December 31, 2018 58,171,466 582 $ 69,873 $ (43,365 ) $ 27,090 Stock option expense - - 88 - 88 Purchase of shares for cancellation (27,900 ) - (9 ) - (9 ) Net loss - - - (441 ) (441 ) Balance at March 31, 2019 58,143,566 $ 582 $ 69,952 $ (43,806 ) $ 26,728 Shareholders’ Equity for the three months ended March 31, 2020: (in thousands, except Share amounts) Common Common Additional Total Stock Stock Paid-in Accumulated Shareholders’ Shares Amount Capital Deficit Equity Balance at December 31, 2019 58,133,066 581 $ 70,204 $ (46,654 ) $ 24,131 Stock option expense - - 85 - 85 Purchase of shares for cancellation (16,700 ) - (3 ) - (3 ) Net loss - - - (607 ) (607 ) Balance at March 31, 2020 58,116,366 $ 581 $ 70,286 $ (47,261 ) $ 23,606 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 2019, Solitario’s Board of Directors extended the expiration date of the share repurchase program through December 31, 2020. During the three months ended March 31, 2020 and 2019, Solitario purchased 16,700 and 27,900 shares of Solitario common stock, respectively, for an aggregate purchase price of $3,000 and $9,000, respectively. As of March 31, 2020, Solitario has purchased a total of 986,000 shares for an aggregate purchase price of $465,000 under the share repurchase program since its inception. |
Subsequent Event
Subsequent Event | 3 Months Ended |
Mar. 31, 2020 | |
Subsequent Events [Abstract] | |
Subsequent Event | In April 2020, in response to significant market volatility and uncertainty and the resulting need for Solitario to conserve its financial resources, Solitario applied for and received a loan in the amount of $70,000 (the “PPP Loan”) pursuant to the Paycheck Protection Program under the Coronavirus Aid, Relief, and Economic Security Act (the “CARES Act”) to help fund Company payroll, rent and utilities obligations. The PPP Loan has a two-year term and bears interest at a rate of 1.0% per annum. Monthly principal and interest payments are deferred for six months after the date of disbursement. The PPP Loan may be prepaid at any time prior to maturity, under certain conditions, with no prepayment penalties. The Promissory Note contains events of default and other provisions customary for a loan of this type. The Paycheck Protection Program provides that the PPP Loan may be partially or wholly forgiven if the funds are used for certain qualifying expenses as described in the CARES Act. Solitario intends to use the proceeds from the PPP Loan for qualifying expenses and to apply for forgiveness of the PPP Loan in accordance with the terms of the CARES Act. However, Solitario cannot completely assure at this time that such forgiveness of the PPP Loan will occur. |
Business and Significant Acco_2
Business and Significant Accounting Policies (Policies) | 3 Months Ended |
Mar. 31, 2020 | |
Accounting Policies [Abstract] | |
Business and company formation | Solitario Zinc Corp. (“Solitario,” or the “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 or royalties and/or discover economic deposits on its mineral properties and advance these deposits, either on its own or through joint ventures, up to the development stage. At that point, or sometime prior to that point, Solitario would 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. Solitario is primarily focused on the acquisition and exploration of zinc-related exploration mineral properties; however Solitario will evaluate and acquire other base and precious metal mineral exploration properties. In addition to focusing on its mineral exploration properties and the evaluation of mineral properties for acquisition, Solitario also evaluates potential strategic transactions for the acquisition of new precious and base metal properties and assets with exploration potential or business combinations that Solitario determines to be favorable to Solitario. Solitario has recorded revenue in the past from the sale of mineral property, including (i) the sale of certain mineral royalty properties to SilverStream SEZC, a private Cayman Island royalty and streaming company (“SilverStream”) for Cdn$600,000 in January 2019 (the “Royalty Sale”), and (ii) the sale in June 2018 of its interest in the royalty on its Yanacocha property. In addition, Solitario has received proceeds from (i) the sale in 2015 of its former interest in Mount Hamilton LLC (“MH-LLC”), the owner of its former Mt. Hamilton project; (ii) the sale of a royalty on its former Mt. Hamilton project and (iii) joint venture property payments. Revenues and / or proceeds from the sale or joint venture of properties or assets, although significant when they occur, have not been a consistent annual source of cash 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 in Peru and its interest in the Lik project in Alaska to be its core mineral property assets. Nexa Resources, Ltd. (“Nexa”), Solitario’s joint venture partner, is expected to continue the exploration and furtherance of the Florida Canyon project and Solitario is monitoring progress at Florida Canyon. Solitario is working with its 50% joint venture partner in the Lik deposit, Teck American Incorporated, a wholly-owned subsidiary of Teck Resources Limited (both companies are referred to as “Teck”), to further the exploration and evaluate potential development plans for the Lik project. As of March 31, 2020, Solitario has significant balances of cash and short-term investments that Solitario anticipates using, in part, to fund costs and activities intended to further the exploration of the Florida Canyon and Lik projects and to potentially acquire additional mineral property assets. The fluctuations in precious metal and other commodity prices contribute to a challenging environment for mineral exploration and development, which has created opportunities as well as challenges for the potential acquisition of early-stage and advanced mineral exploration projects or other related assets at potentially attractive terms. The accompanying interim condensed consolidated financial statements of Solitario for the three months ended March 31, 2020 are unaudited and are prepared in accordance with accounting principles generally accepted in the United States of America (“generally accepted accounting principles”). They do not include all disclosures required by generally accepted accounting principles for annual financial statements, but in the opinion of management, include all adjustments necessary for a fair presentation. Interim results are not necessarily indicative of results, which may be achieved in the future, or for the full year ending December 31, 2020. These financial statements should be read in conjunction with the financial statements and notes thereto which are included in Solitario’s Annual Report on Form 10-K for the year ended December 31, 2019. The accounting policies set forth in those annual financial statements are the same as the accounting policies utilized in the preparation of these financial statements, except as modified for appropriate interim financial statement presentation. |
Risks and Uncertainties | Solitario faces risks related to health epidemics and other outbreaks of communicable diseases, which could significantly disrupt its operations and may materially and adversely affect our business and financial conditions. Solitario’s business could be adversely impacted by the effects of the coronavirus (COVID-19) or other epidemics or pandemics. The extent to which the coronavirus impacts Solitario’s business, including our exploration and other activities and the market for its securities, will depend on future developments, which are highly uncertain and cannot be predicted at this time, and include the duration, severity and scope of the outbreak and the actions taken to contain or treat the coronavirus outbreak. Solitario has taken steps to conserve its financial resources including reducing costs, in response to the economic uncertainty associated with these risks. See Item 1A “Risk Factors” below. |
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 generally accepted accounting principles and are expressed in U.S. dollars. |
Revenue recognition | 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 the three months ended March 31, 2019 of $408,000 related to the Royalty Sale in accordance with Accounting Standards Codification (“ASC”) 606. Solitario expects any property, royalty or asset sales in the future to be on an infrequent basis. 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. |
Use of estimates | The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. Some of the more significant estimates included in the preparation of Solitario's financial statements pertain to: (i) the recoverability of mineral properties related to its mineral exploration properties and their future exploration potential; (ii) the fair value of stock option grants to employees; (iii) the ability of Solitario to realize its deferred tax assets; (iv) Solitario's investment in marketable equity securities; and (v) the collectability of the SilverStream Note (as defined below). 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 or its joint venture partners to obtain the necessary permits and financing to successfully place the properties into production, and upon future profitable operations, none of which is assured. |
Cash equivalents | Cash equivalents include investments in highly liquid money-market securities with original maturities of three months or less when purchased. As of March 31, 2020, $425,000 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 | As of March 31, 2020, Solitario has $6,325,000 of its current assets in United States Treasury Securities (“USTS”) with maturities of 15 days to 15 months. In addition, Solitario has two bank certificates of deposits (“CD’s”) each with a face value of $250,000. The USTS and CD’s are recorded at their fair value, based upon quoted market prices. The USTS are not covered under the FDIC insurance rules for United States deposits. Solitario’s USTS and CD’s 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. |
Leases | Solitario accounts for its leases in accordance with ASC 842, Leases |
Derivative instruments | Solitario accounts for its derivative instruments in accordance with ASC 815. |
Fair value | ASC 820 established a framework for measuring fair value of financial instruments and required disclosures about fair value measurements. 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 CD’s, 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 6, “Fair Value,” below. |
Marketable equity securities | Solitario's investments in marketable equity securities are carried at fair value, which is based upon quoted prices of the securities owned. Solitario records investments in marketable equity securities 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 condensed consolidated statement 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 2019 and the first quarter of 2020 were conducted primarily in Peru, a portion of the payments under land, leasehold and exploration agreements of Solitario are denominated in United States dollars. Realized 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. |
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 three months ended March 31, 2020 and 2019. Potentially dilutive shares related to outstanding common stock options of 4,373,000 and 4,373,000, respectively, for Solitario common shares for the three months ended March 31, 2020 and 2019 were excluded from the calculation of diluted loss per share because the effects were anti-dilutive. |
Employee stock compensation and incentive plans | Solitario classifies all of its stock options as equity options in accordance with the provisions of ASC 718, “Compensation – Stock Compensation.” |
Recent accounting pronouncements | The Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2016-13, Financial Instruments – Credit Losses (Topic 326): Measurements of Credit Losses on Financial Statements . The FASB issued ASU No. 2018-13, Disclosure Framework – Fair Value (topic 820): Changes to Disclosure Requirements for Fair Value Measurement . Recently issued accounting pronouncements The SEC has adopted amendments to its disclosure rules to modernize the mineral property disclosure requirements for issuers whose securities are registered with the SEC. These amendments became effective February 25, 2019 (the “SEC Modernization Rules”) and, following a two-year transition period, the SEC Modernization Rules will replace the historical property disclosure requirements for mining registrants that are included in SEC Industry Guide 7. Under the SEC Modernization Rules, consistent with global standards as embodied by the Committee for Reserves International Reporting Standards (“CRIRSCO”), registrants will be required to disclose specified information concerning mineral resources that have been identified on one or more of its mineral properties. Consistent with CRIRSCO standards the SEC Modernization Rules have added definitions to recognize “Measured Mineral Resources”, “Indicated Mineral Resources” and “Inferred Mineral Resources.” The Company is not required to provide disclosure on its mineral properties under the SEC Modernization Rules until its fiscal year beginning January 1, 2021. Upon adoption of the SEC Modernization Rules, among other requirements, the Company will be required to report its mineral resources, if any, as Measured, Indicated or Inferred Mineral Resources in accordance with the SEC Modernization Rules. This will allow investors to evaluate the Company’s resources on a comparable basis with other mining and exploration issuers registered with the SEC. In addition, the SEC Modernization Rules will require the Company to disclose exploration results, mineral reserves, if any, and mineral resources based upon information and supporting documentation prepared by a mining expert (the “qualified person”). The SEC Modernization Rules will require the Company to obtain a dated and signed technical report summary from the qualified person identifying and summarizing the information reviewed and conclusions reached by the qualified person(s) about the mineral resources or reserves for each mineral property. The Company is currently evaluating the requirements under the SEC Modernization Rules and has not determined what effect adoption will have on its consolidated financial statements and disclosures. |
Mineral Property (Tables)
Mineral Property (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Extractive Industries [Abstract] | |
Investment in mineral property | (in thousands) March 31, December 31, 2020 2019 Exploration Lik project (Alaska – US) $ 15,611 $ 15,611 La Promesa (Peru) 6 6 Total exploration mineral property $ 15,617 $ 15,617 |
Exploration expense | (in thousands) Three months ended March 31, 2020 2019 Geologic and field expenses $ 90 $ 147 Administrative 23 16 Total exploration costs $ 113 $ 163 |
Marketable Equity Securities (T
Marketable Equity Securities (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Investments, Debt and Equity Securities [Abstract] | |
Marketable securities and adjustment to fair value | (in thousands) March 31, 2020 December 31, 2019 Marketable equity securities at cost $ 1,828 $ 1,879 Cumulative unrealized loss on marketable equity securities (1,073 ) (840 ) Marketable equity securities at fair value $ 755 $ 1,039 |
Changes in marketable securities | (in thousands) Three months ended March 31, 2020 2019 Cost of marketable equity securities sold $ 51 $ - Realized gain on marketable equity securities sold 25 - Proceeds from the sale of marketable equity securities sold (76 ) - Net loss on marketable equity securities (208 ) (326 ) Change in marketable equity securities at fair value $ (284 ) $ (326 ) |
Realized and unrealized gain (loss) on marketable equity securities | (in thousands) Three months ended March 31, 2020 2019 Unrealized loss on marketable securities $ (233 ) $ (326 ) Realized gain on marketable equity securities sold 25 - Net loss on marketable securities $ (208 ) $ (326 ) |
Leases (Tables)
Leases (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Leases [Abstract] | |
Maturities of lease liability | Future lease payments (in thousands) 2020 32 2021 7 Total lease payments 39 Less amount of payments representing interest (1 ) Present value of lease payments $ 38 |
Supplemental cash flow for operating lease | (in thousands) Three months ended March 31, 2020 2019 Cash paid for amounts included in the measurement of lease liabilities Operating cash outflows from WR Lease payments $ 10 $ 7 Non-cash amounts related to the WR lease Leased assets recorded in exchange for new operating lease liabilities $ - $ 82 |
Other Assets (Tables)
Other Assets (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Other Assets [Abstract] | |
Other assets | (in thousands) March 31, December 31 2020 2019 Furniture and fixtures, net of accumulated depreciation $ 38 $ 39 Lik project equipment, net of accumulated depreciation 45 50 Office lease asset 36 45 Vendetta warrants 13 21 Exploration bonds and other assets 4 4 Total other $ 136 $ 159 |
Fair Value (Tables)
Fair Value (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Fair Value Disclosures [Abstract] | |
Financial assets and liabilities measured at fair value | 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 March 31, 2020: (in thousands) Level 1 Level 2 Level 3 Total Assets Short-term investments $ 6,829 $ - $ - $ 6,829 Marketable equity securities $ 755 $ - $ - $ 755 2019 Vendetta Warrants $ - $ 13 $ - $ 13 Liabilities Kinross call options $ 9 $ - $ - $ 9 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, 2019: (in thousands) Level 1 Level 2 Level 3 Total Assets Short-term investments $ 6,829 $ - $ - $ 6,829 Marketable equity securities $ 1,039 $ - $ - $ 1,039 2019 Vendetta Warrants $ - $ 21 $ - $ 21 |
Shareholders' Equity (Tables)
Shareholders' Equity (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Equity [Abstract] | |
Shareholders' equity | Shareholders’ Equity for the three months ended March 31, 2019: (in thousands, except Share amounts) Common Common Additional Total Stock Stock Paid-in Accumulated Shareholders’ Shares Amount Capital Deficit Equity Balance at December 31, 2018 58,171,466 582 $ 69,873 $ (43,365 ) $ 27,090 Stock option expense - - 88 - 88 Purchase of shares for cancellation (27,900 ) - (9 ) - (9 ) Net loss - - - (441 ) (441 ) Balance at March 31, 2019 58,143,566 $ 582 $ 69,952 $ (43,806 ) $ 26,728 Shareholders’ Equity for the three months ended March 31, 2020: (in thousands, except Share amounts) Common Common Additional Total Stock Stock Paid-in Accumulated Shareholders’ Shares Amount Capital Deficit Equity Balance at December 31, 2019 58,133,066 581 $ 70,204 $ (46,654 ) $ 24,131 Stock option expense - - 85 - 85 Purchase of shares for cancellation (16,700 ) - (3 ) - (3 ) Net loss - - - (607 ) (607 ) Balance at March 31, 2020 58,116,366 $ 581 $ 70,286 $ (47,261 ) $ 23,606 |
Business and Significant Acco_3
Business and Significant Accounting Policies (Details Narrative) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Accounting Policies [Abstract] | ||
Recognized revenue - Royalty Sale | $ 0 | $ 408 |
Cash and cash equivalents held in brokerage accounts and foreign banks | 425 | |
Current assets in United States Treasury Securities | $ 6,325 | |
Potentially dilutive shares related to outstanding common stock options | 4,373 | 4,373 |
Mineral Property (Details)
Mineral Property (Details) - USD ($) $ in Thousands | Mar. 31, 2020 | Dec. 31, 2019 |
Mineral properties | $ 15,617 | $ 15,617 |
Lik Project Alaska (US) | ||
Mineral properties | 15,611 | 15,611 |
La Promesa (Peru) | ||
Mineral properties | $ 6 | $ 6 |
Mineral Property (Details 1)
Mineral Property (Details 1) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Extractive Industries [Abstract] | ||
Geologic and field expenses | $ 90 | $ 147 |
Administrative | 23 | 16 |
Total exploration costs | $ 113 | $ 163 |
Mineral Property (Details Narra
Mineral Property (Details Narrative) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Extractive Industries [Abstract] | ||
Interest income from SiverStream Note | $ 5 | $ 2 |
Mineral property revenue - Royalty Sale | 0 | 408 |
Fair value of cash received on date of sale | 0 | 185 |
Fair value of note received for royalty sale less carrying value | 0 | $ 263 |
Lik asset retirement obligation | $ 125 |
Marketable Equity Securities (D
Marketable Equity Securities (Details) - USD ($) $ in Thousands | Mar. 31, 2020 | Dec. 31, 2019 |
Investments, Debt and Equity Securities [Abstract] | ||
Marketable equity securities at cost | $ 1,828 | $ 1,879 |
Cumulative unrealized loss on marketable equity securities | (1,073) | (840) |
Marketable equity securities at fair value | $ 755 | $ 1,039 |
Marketable Equity Securities _2
Marketable Equity Securities (Details 1) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Investments, Debt and Equity Securities [Abstract] | ||
Cost of marketable equity securities sold | $ 51 | $ 0 |
Realized gain on marketable equity securities sold | 25 | 0 |
Proceeds from the sale of marketable equity securities sold | (76) | 0 |
Net loss on marketable equity securities | (208) | (326) |
Change in marketable equity securities at fair value | $ (284) | $ (326) |
Marketable Equity Securities _3
Marketable Equity Securities (Details 2) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Investments, Debt and Equity Securities [Abstract] | ||
Unrealized loss on marketable securities | $ (233) | $ (326) |
Realized gain on marketable equities securities sold | 25 | 0 |
Net loss on marketable securities | $ (208) | $ (326) |
Marketable Equity Securities _4
Marketable Equity Securities (Details Narrative) $ in Thousands | 3 Months Ended |
Mar. 31, 2020USD ($)shares | |
Investments, Debt and Equity Securities [Abstract] | |
Sale of Vendetta Mining Corp. shares | shares | 2,000,000 |
Sale of Vendetta Mining Corp. amount | $ 76 |
Loss on derivative instruments | $ (7) |
Operating Leases (Details)
Operating Leases (Details) $ in Thousands | Mar. 31, 2020USD ($) |
Leases [Abstract] | |
2020 | $ 32 |
2021 | 7 |
Total lease payments | 39 |
Less amount of payments representing interest | (1) |
Present value of lease payments | $ 38 |
Operating Leases (Details 1)
Operating Leases (Details 1) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Leases [Abstract] | ||
Operating cash outflows from WR Lease payments | $ 10 | $ 7 |
Leased assets recorded in exchange for new operating lease liabilities | $ 0 | $ 82 |
Operating Leases (Details Narra
Operating Leases (Details Narrative) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Leases [Abstract] | ||
Non-cash lease amortization of right of use lease asset expense recognized | $ 10 | $ 10 |
Cash lease payments | 10 | 7 |
Imputed interest | $ 1 | $ 1 |
Other Assets (Details)
Other Assets (Details) - USD ($) $ in Thousands | Mar. 31, 2020 | Dec. 31, 2019 |
Other assets | $ 136 | $ 159 |
Furniture and Fixtures | ||
Other assets | 38 | 39 |
Lik Project Equipment | ||
Other assets | 45 | 50 |
Office Lease Asset | ||
Other assets | 36 | 45 |
Vendetta Warrants | ||
Other assets | 13 | 21 |
Exploration Bonds and Other Assets | ||
Other assets | $ 4 | $ 4 |
Fair Value (Details)
Fair Value (Details) - USD ($) $ in Thousands | Mar. 31, 2020 | Dec. 31, 2019 |
Assets | ||
Short-term investments | $ 6,829 | $ 6,829 |
Marketable equity securities | 755 | 1,039 |
Vendetta Warrants | 13 | 21 |
Liabilities | ||
Kinross calls | 9 | |
Level 1 | ||
Assets | ||
Short-term investments | 6,829 | 6,829 |
Marketable equity securities | 755 | 1,039 |
Vendetta Warrants | 0 | 0 |
Liabilities | ||
Kinross calls | 9 | |
Level 2 | ||
Assets | ||
Short-term investments | 0 | 0 |
Marketable equity securities | 0 | 0 |
Vendetta Warrants | 13 | 21 |
Liabilities | ||
Kinross calls | 0 | |
Level 3 | ||
Assets | ||
Short-term investments | 0 | 0 |
Marketable equity securities | 0 | 0 |
Vendetta Warrants | 0 | $ 0 |
Liabilities | ||
Kinross calls | $ 0 |
Employee Stock Compensation P_2
Employee Stock Compensation Plans (Details Narrative) - USD ($) $ in Thousands | 3 Months Ended | ||
Mar. 31, 2020 | Mar. 31, 2019 | Dec. 31, 2019 | |
Share-based Payment Arrangement [Abstract] | |||
Options outstanding | 4,373,000 | 4,373,000 | |
Options exercisable | 4,373,000 | 4,373,000 | |
Options granted | 0 | 0 | |
Option compensation expense | $ 85 | $ 88 | |
Unrecognized stock option compensation | $ 232 | $ 0 | |
Unrecognized stock option compensation recognition period | 13 months |
Shareholders' Equity (Details)
Shareholders' Equity (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Common Stock | ||
Beginning balance, shares | 58,133,066 | 58,171,466 |
Beginning balance, value | $ 581 | $ 582 |
Purchase of shares for cancellation, shares | (16,700) | (27,900) |
Ending balance, shares | 58,116,366 | 58,143,566 |
Ending balance, value | $ 581 | $ 582 |
Additional Paid-in Capital | ||
Beginning balance, value | 70,204 | 69,873 |
Stock option expense | 85 | 88 |
Purchase of shares for cancellation, value | (3) | (9) |
Ending balance, value | 70,286 | 69,952 |
Accumulated Deficit | ||
Beginning balance, value | (46,654) | (43,365) |
Net loss | (607) | (441) |
Ending balance, value | (47,261) | (43,806) |
Beginning balance, value | 24,131 | 27,090 |
Stock option expense | 85 | 88 |
Purchase of shares for cancellation, value | (3) | (9) |
Net loss | (607) | (441) |
Ending balance, value | $ 23,606 | $ 26,728 |
Shareholders' Equity (Details N
Shareholders' Equity (Details Narrative) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Equity [Abstract] | ||
Shares repurchased | 16,700 | 27,900 |
Aggregate purchase price | $ 3 | $ 9 |
Total shares repurchased | 986,000 | |
Total aggregate purchase price | $ 465 |