Note

Stockholders’ Equity

Stock-based Compensation Plans

We periodically grant restricted stock unit awards and/or shares of common stock to our employees and directors. We measure compensation cost for restricted stock units and stock grants at the closing price of our stock at the time of grant. Restricted stock unit grants vest after a specified period with compensation cost amortized over that period. Although we have no current plans to issue stock options, we

may

do so in the future.

March

2017,

the Board of Directors granted

641,406

shares of common stock to employees for payment of annual and long-term incentive compensation for the period ended

December

31,

2016.

The shares were distributed in

March

2017,

and

$4.2

million in expense related to the stock awards was recognized in the periods prior to

March

31,

2017.

Stock-based compensation expense for vesting restricted stock unit grants to employees and shares issued to nonemployee directors recorded in the

first

three

months of

2017

totaled

$1.3

million, compared to

$1.2

million in the same period last year.

In connection with the vesting of restricted stock units and other stock grants, employees have in the past, at their election and when permitted by us, chosen to satisfy their minimum tax withholding obligations through net share settlement, pursuant to which the Company withholds the number of shares necessary to satisfy such withholding obligations. As a result, in the

first

three

months of

2017

we withheld

154,933

shares valued at approximately

$0.7

million, or approximately

$4.67

per share. In the

first

three

months of

2016

we withheld

532,157

shares valued at approximately

$1.3

million, or approximately

$2.36

per share.

Common Stock Dividends

September

2011

and

February

2012,

our Board of Directors adopted a common stock dividend policy that has

two

components:

(1)

a dividend that links the amount of dividends on our common stock to our average quarterly realized silver price in the preceding quarter, and

(2)

a minimum annual dividend of

$0.01

per share of common stock, in each case, payable quarterly, if and when declared. For illustrative purposes only, the table below summarizes potential per share dividend amounts at different quarterly average realized price levels according to the

first

component of the policy:

Quarterly average realized silver price per ounce		Quarterly dividend per share		Annualized dividend per share
	$30		$0.01		$0.04
	$35		$0.02		$0.08
	$40		$0.03		$0.12
	$45		$0.04		$0.16
	$50		$0.05		$0.20

May

2017,

our Board of Directors declared a common stock dividend, pursuant to the minimum annual dividend component of the policy described above, of

$0.0025

per share, for a total dividend of approximately

$1.0

million payable in

June

2017.

Because the average realized silver price for the

first

quarter of

2017

was

$17.90

per ounce, below the minimum threshold of

$30

according to the policy, no silver-price-linked component was declared or paid. The declaration and payment of common stock dividends is at the sole discretion of our Board of Directors.

At-The-Market Equity Distribution Agreement

Pursuant to an equity distribution agreement dated

February

23,

2016,

may

issue and sell shares of our common stock from time to time through ordinary broker transactions having an aggregate offering price of up to

$75

million, with the net proceeds available for general corporate purposes. The terms of sales transactions under the agreement, including trading day(s), number of shares sold in the aggregate, number of shares sold per trading day, and the floor selling price per share, are proposed by us to the sales agent. Whether or not we engage in sales from time to time

may

depend on a variety of factors, including share price, our cash resources, customary black-out restrictions, and whether we have any material inside information. The agreement can be terminated by us at any time. The shares issued under the equity distribution agreement are registered under the Securities Act of

1933,

as amended, pursuant to our shelf registration statement on Form S-

which was filed with the SEC on

February

23,

2016.

As of

March

31,

2017,

we had sold

2,780,087

shares under the agreement for total proceeds of approximately

$8.1

million, net of commissions of approximately

$166

thousand.

Common Stock Repurchase Program

May

2012,

we announced that our Board of Directors approved a stock repurchase program. Under the program, we are authorized to repurchase up to

million shares of our outstanding common stock from time to time in open market or privately negotiated transactions, depending on prevailing market conditions and other factors. The repurchase program

may

be modified, suspended or discontinued by us at any time. Whether or not we engage in repurchases from time to time

may

depend on a variety of factors, including not only price and cash resources, but customary black-out restrictions, whether we have any material inside information, limitations on share repurchases or cash usage that

may

be imposed by our credit agreement or in connection with issuances of securities, alternative uses for cash, applicable law, and other investment opportunities from time to time. As of

March

31,

2017,

934,100

shares have been purchased at an average price of

$3.99

per share, leaving approximately

19.1

million shares that

may

yet be purchased under the program. The closing price of our common stock at

May

2017,

was

$5.14

per share.