Executive Summary / Key Takeaways

• Paramount Gold Nevada Corp. is a pre-revenue precious metals exploration and development company primarily focused on advancing its Grassy Mountain project in Oregon towards production, operating within a competitive landscape dominated by much larger miners.
• Recent operational focus has centered on permitting at Grassy Mountain, highlighted by the State of Oregon's approval of the Environmental Evaluation in October 2024, initiating a critical 225-day timeline for draft state permits.
• The company continues to incur net losses ($2.62M in Q3 2025, $6.22M in the first nine months of fiscal 2025) and relies entirely on external financing, including ATM equity sales and a royalty convertible debenture, to fund operations and project advancement.
• Paramount faces substantial doubt about its ability to continue as a going concern within the next twelve months, underscoring the critical need to secure significant additional capital to fund anticipated expenditures ($3.0M corporate, $2.5M discretionary Grassy Mountain permitting over 12 months) and advance its projects.
• The investment thesis is highly speculative, hinging on the successful and timely permitting of Grassy Mountain and the subsequent ability to secure substantial construction financing or a strategic transaction in a challenging funding environment for development-stage companies.

A High-Sakes Play in US Gold Exploration

Paramount Gold Nevada Corp. is positioned as a focused player in the competitive U.S. precious metals exploration and development sector. Unlike diversified, large-scale miners such as Newmont Corporation (NEM), Pan American Silver Corp. (PAAS), and Barrick Gold Corporation (GOLD), Paramount operates as a pre-revenue company dedicated to advancing its portfolio of gold and silver projects. Its strategy is centered on creating shareholder value by exploring and developing its mineral properties with the ultimate goal of realizing value through potential asset sales to established producers, entering joint ventures for construction and operation, or by constructing and operating mines for its own account. This approach places Paramount in a high-risk, high-reward category compared to its larger, cash-generating peers.

The company's portfolio includes a 100% interest in three key projects: the Grassy Mountain project in Oregon, and the Sleeper and Bald Peak projects in Nevada. The Grassy Mountain project is the most advanced, having completed a positive Feasibility Study. The Sleeper Gold Project, located in the prolific mining jurisdiction of Northern Nevada, includes a former producing mine, while the Bald Peak project is described as drill-ready. Paramount's history since its 2015 spin-out from Coeur Mining (CDE) has been marked by consistent losses and negative operating cash flows, necessitating continuous reliance on external capital markets through equity, debt, and royalty financings.

In the broader competitive landscape, Paramount faces significant disadvantages in scale and financial strength. Larger competitors like Newmont and Barrick benefit from operational efficiencies, technological investments (such as advanced automation and metallurgy), and substantial financial buffers that allow them to absorb market volatility and invest aggressively in growth and innovation. While the company appears to lack specific technological differentiators, its focus on U.S. assets and participation in programs like FAST-41 for Grassy Mountain could offer a potential regulatory advantage in the permitting timeline compared to projects in less streamlined jurisdictions. However, this regulatory edge does not offset the fundamental operational cost efficiencies enjoyed by larger, more technologically advanced miners.

Recent Progress and Financial Realities

The operational focus for Paramount in the recent period, particularly the nine months ended March 31, 2025, has been squarely on advancing the Grassy Mountain project through the complex permitting process. A significant milestone was achieved in October 2024 with the State of Oregon's Technical Review Team approving the completion of the Environmental Evaluation (EE). This approval is a critical step, initiating a 225-day legislated timeline for the state permitting agencies to submit draft mining permits. Management, including Chairman Rudi Fronk, has expressed optimism that this progress, set against a backdrop of efforts to streamline U.S. permitting, will lead to securing all major permits for Grassy Mountain over the course of 2025. Recent leadership changes saw President and COO Glen Van Treek, who was instrumental in advancing the core assets, retire in May 2025, with CEO Rachel Goldman assuming oversight of Grassy Mountain permitting activities.

Financially, the company's pre-revenue status means its results reflect ongoing exploration, development, and administrative costs. For the three months ended March 31, 2025, Paramount reported a net loss of $2.62 million, a 44% increase compared to the $1.81 million loss in the prior-year quarter. The net loss for the nine months ended March 31, 2025, was $6.22 million, a 14% increase from $5.46 million in the same period last year. These increased losses were driven by higher professional fees (up significantly due to consulting and legal costs), general and administrative expenses (up 59% in Q3 and 28% in 9mo due to insurance, travel, and investor relations), directors compensation (up sharply due to higher equity awards), and land holding costs (up due to increased BLM fees). These increases were partially offset by a substantial decrease in reclamation expenses at the Sleeper project, where a one-time pond conversion project was largely completed in the previous fiscal year. Other income for the nine-month period included a notable $2.38 million reimbursement of reclamation costs from an insurance policy.

The company's cash position decreased from $5.42 million at June 30, 2024, to $2.14 million at March 31, 2025. Cash used in operating activities totaled $3.56 million for the nine months ended March 31, 2025, primarily funding permitting, exploration, salaries, and G&A. Investing activities used $159,098, mainly for mineral property purchases (including the final $100,000 payment for the Frost Claims) and equipment. Financing activities provided $439,564, solely from sales under the company's At-The-Market (ATM) equity program. Subsequent to the quarter end, the company raised an additional $217,922 net through ATM sales.

Liquidity, Funding Imperative, and Outlook

Paramount's financial condition is characterized by limited liquidity and a heavy reliance on external funding. With a working capital of approximately $2.18 million at March 31, 2025, and ongoing operational and development expenditures, the company explicitly states that events and conditions raise substantial doubt about its ability to continue as a going concern within one year. Management anticipates twelve-month cash expenditures of $3.0 million for corporate, land maintenance, and general expenses, plus a discretionary $2.5 million for Grassy Mountain permitting activities, subject to cash availability.

Funding these anticipated costs and advancing Grassy Mountain towards a production decision requires significant additional capital. Historically, the company has accessed capital through equity, debt, and royalty sales, and expects to continue relying on these sources. A key financing arrangement is the $15.0 million Secured Royalty Convertible Debenture with Sprott (SII), closed in December 2023. This debenture bears 10% interest, which Paramount expects to pay in shares of common stock. The debenture is convertible into a 4.75% gross revenue royalty on Grassy Mountain production at Sprott's discretion, upon commercial production or within five years. This facility provides some funding flexibility but also introduces potential future royalty obligations or debt repayment requirements.

The path forward for Paramount is intrinsically linked to the successful permitting of Grassy Mountain. Securing major permits is a necessary precursor to attracting the substantial construction financing or strategic partnership required to build a mine. The company's outlook, while not providing specific revenue or profitability targets given its stage, is focused on achieving these critical permitting milestones in 2025. The ability to secure the necessary funding post-permitting is paramount and represents the next major hurdle.

Risks and Competitive Realities

The primary risk facing Paramount is its ability to secure sufficient additional financing to continue operations and advance its projects. The explicit "going concern" disclosure highlights this challenge. Failure to obtain funding on acceptable terms would severely impact or halt exploration and development activities. Permitting risk, while showing recent positive movement at Grassy Mountain, remains significant; delays or unfavorable conditions could jeopardize the project timeline and funding prospects.

Another notable risk is the Net Profit Interest (NPI) put option held by Seabridge Gold Inc. (SA). If Paramount makes a positive production decision and secures construction financing for Grassy Mountain, Seabridge can require Paramount to purchase the NPI for CDN $10 million. This potential obligation adds a significant funding requirement that would likely necessitate further financing, compounding the existing capital needs.

In the competitive landscape, Paramount's smaller size and pre-revenue status make it vulnerable. Larger competitors have the financial muscle to acquire promising projects, invest heavily in technology and exploration, and withstand market downturns more effectively. While Paramount's U.S. focus offers some regulatory stability, it lacks the geographic diversification and operational scale that provide resilience to companies like PAAS and GOLD. The success of Paramount's strategy hinges on its ability to demonstrate sufficient value at Grassy Mountain to attract a strategic partner or financing, or to navigate the development process independently, a path fraught with execution risk and capital intensity.

Conclusion

Paramount Gold Nevada Corp. represents a speculative investment opportunity centered on the potential development of its Grassy Mountain gold project. The recent progress in the Oregon state permitting process is a crucial step forward, initiating a defined timeline for draft permits and providing a tangible milestone for investors to monitor. However, the company's pre-revenue status, ongoing losses, and limited cash reserves create a significant funding imperative and raise substantial doubt about its ability to continue as a going concern without securing additional capital.

The investment thesis is fundamentally a bet on the successful permitting and subsequent financing or strategic transaction for Grassy Mountain. While the company holds promising assets in favorable jurisdictions and is actively pursuing their development, the challenges of operating as a small explorer in a capital-intensive industry dominated by giants are considerable. Investors considering PZG must weigh the potential upside of successful project development against the substantial risks related to financing, permitting, and the inherent uncertainties of the mining sector, all within a competitive environment where scale and financial strength are key advantages. The coming months, particularly regarding the Grassy Mountain permitting timeline and the company's ability to secure necessary funding, will be critical in determining Paramount's future trajectory.