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Employee Stock Compensation Plans

12 Months Ended

Dec. 31, 2023

Employee Stock Compensation Plans

Employee Stock Compensation Plans

10. Employee Stock Compensation Plans:

On June 18, 2013, Solitario’s shareholders approved the 2013 Solitario Exploration & Royalty Corp. Omnibus Stock and Incentive Plan, as amended (the “2013 Plan”), which expired in April 2023. Under the terms of the 2013 Plan, a total of 5,750,000 shares of Solitario common stock are reserved for awards to directors, officers, employees and consultants. The 2013 plan permitted the Board of Directors of the Company (the “Board of Directors”) or a committee appointed by the Board of Directors to grant awards in the form of stock options, stock appreciation rights, restricted stock, and restricted stock units. As of December 31, 2023, the 2013 Plan has expired and no additional awards may be granted under the 2013 Plan, although awards made prior to the 2013 Plan’s expiration will remain outstanding in accordance with their terms. The outstanding awards under the 2013 Plan are detailed below.

On June 20, 2023, Solitario’s shareholders approved the 2023 Solitario Stock and Incentive Plan (the “2023 Plan”). Under the terms of the 2023 Plan, a total of 5,000,000 shares of Solitario common stock are reserved for awards to directors, officers, employees and consultants. Awards may take the form of stock options, stock appreciation rights, restricted stock and restricted stock units. The terms and conditions of the awards are pursuant to the 2023 Plan and are granted by the Board of Directors or a committee appointed by the Board of Directors. The 2023 Plan has a term of 10 years. As of December 31, 2023, awards for a total of 50,000 options have been granted under the 2023 Plan.

a.) Stock option grants

The following table shows the grant date fair value of Solitario’s awards during 2023 and 2022 pursuant to the 2013 Plan and the 2023 Plan:

Grant Date		11/16/23 (1)				9/8/22 (1)
Plan		2023 Plan				2013 Plan
Option – grant date price		$	0.51			$	0.60
Options granted			50,000				2,360,000
Expected life years			5.0				5.0
Expected volatility			72	%			73	%
Risk free interest rate			4.4	%			3.4	%
Weighted average fair value		$	0.32			$	0.37
Grant date fair value		$	16,000			$	876,000

(1)

Option grants have a five-year term, and vest 25% on date of grant and 25% on each of the next three anniversary dates.

b.) Stock option activity

During 2023 and 2022, options for 1,486,500 and 114,250, respectively, shares of common stock were exercised for proceeds of $459,315 and $30,000 respectively. The following table summarizes the activity for stock options outstanding under the 2023 Plan and the 2013 Plan for the years ended December 31, 2023 and 2022:

		2023												2022
						Weighted												Weighted
						Average				Aggregate								Average				Aggregate
						Exercise				Intrinsic								Exercise				Intrinsic
		Options				Price				Value (1)(2)				Options				Price				Value (1)(2)

Outstanding, beginning of year			5,390,000			$	0.42								5,513,000			$	0.49
Granted			50,000			$	0.51								2,360,000			$	0.60
Exercised			(1,486,500	)		$	0.31			$	338,000				(114,250	)		$	0.26
Expired			-												(2,360,000	)		$	0.77
Forfeited			(125,000	)		$	0.31								(8,750	)		$	0.20
Outstanding, end of year			3,828,500			$	0.47			$	1,034,000				5,390,000			$	0.42			$	1,034,000
Exercisable, end of year			2,576,000			$	0.41			$	899,000				3,227,500			$	0.34			$	899,000

	(1)	Intrinsic value based upon December 31, 2023 and 2022 price of a share of Solitario common stock as quoted on the NYSE American exchange of $0.56 and $0.62, respectively, per share.
	(2)	For options exercised during 2023 the intrinsic value based upon the price of a share of Solitario common stock as quoted on the NYSE American on the date of exercise of each option.

During the years ended December 31, 2023 and 2022, Solitario recorded $247,000 and $338,000, respectively, of stock-based compensation expense under the 2023 Plan and 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, 2023, the total unrecognized stock option compensation cost related to non-vested options is $387,000 and is expected to be recognized over a weighted average period of 20 months. At December 31, 2023, the average remaining contractual life of Solitario’s outstanding options is 2.9 years. At December 31, 2023, the average remaining contractual life of Solitario’s vested options is 2.4 years.