Comstock Metals Ltd. — Remuneration Information 2021

Mar 17, 2021

STATEMENT OF EXECUTIVE COMPENSATION

Securities laws require that a "Statement of Executive Compensation" in accordance with Form 51-102F6 be provided to its shareholders. Such disclosure is to be provided in the issuer's information circular for its annual meeting and if such circular is not provided to shareholders within 180 days of the issuer's fiscal year end, Section 9.3.1 of National Instrument 51-102 – Continuous Disclosure Obligations, provides that such issuer must file on SEDAR the same Statement of Executive Compensation disclosure that would be included in the information circular within the 180 day period. Form 51-102F6 prescribes the disclosure requirements in respect of the compensation of executive officers and directors of reporting issuers. Form 51-102F6 provides that compensation disclosure must be provided for the Chief Executive Officer and the Chief Financial Officer of an issuer and each of the three most highly compensated executive officers whose total compensation exceeds $150,000. Based on those requirements, the executive officers of the Company for whom disclosure is required under Form 51-102F6 are Mr. Steven Goldman, its President and CEO and Mr. Darren Urquhart, its CFO, and such individuals are collectively referred to as the "Named Executive Officers".

Definitions

For the purpose of this statement of executive compensation:

• (i) " CEO " means an individual who acted as chief executive officer of the company, or acted in a similar capacity, for any part of the most recently completed financial year;

• (ii) " CFO " means an individual who acted as chief financial officer of the company, or acted in a similar capacity, for any part of the most recently completed financial year;

• (iii) " closing market price " means the price at which the company’s security was last sold, on the applicable date,

• (i) in the security’s principal marketplace in Canada, or

• (ii) if the security is not listed or quoted on a marketplace in Canada, in the security’s principal marketplace;

• (iv) " company " includes other types of business organizations such as partnerships, trusts and other unincorporated business entities;

• (v) " equity incentive plan " means an incentive plan, or portion of an incentive plan, under which awards are granted and that falls within the scope of Section 3870 of the Handbook;

• (vi) " incentive plan " means any plan providing compensation that depends on achieving certain performance goals or similar conditions within a specified period;

• (vii) " incentive plan award " means compensation awarded, earned, paid or payable under an incentive plan;

• (viii) " NEO " or " named executive officer " means each of the following individuals: (i) a CEO;

• (ii) a CFO;

• (iii) each of the three most highly compensated executive officers, or the three most highly compensated individuals acting in a similar capacity, other than the CEO and CFO, at the end of the most recently completed financial year whose total compensation was, individually, more than $150,000, as determined in accordance with subsection 1.3(6) of Form 51-102F6, for that financial year; and

• (iv) each individual who would be a NEO under paragraph (iii) but for the fact that the individual was neither an executive officer of the company, nor acting in a similar capacity, at the end of that financial year;

• (ix) " non-equity incentive plan " means an incentive plan or portion of an incentive plan that is not an equity incentive plan;

• (x) " option-based award " means an award under an equity incentive plan of options, including, for greater certainty, share options, share appreciation rights and similar instruments that have option-like features;

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• (xi) " plan " includes any plan, contract, authorization or arrangement, whether or not set out in any formal document, where cash, securities, similar instruments or any other property may be received, whether for one or more persons;

• (xii) " share-based award " means an award under an equity incentive plan of equity-based instruments that do not have option-like features, including, for greater certainty, common shares, restricted shares, restricted share units, deferred share units, phantom shares, phantom share units, common share equivalent units, and stock.

Compensation Discussion and Analysis

NEO Compensation Discussion and Analysis

The objective of the Company's compensation strategy is to provide adequate levels of base compensation for its NEOs as well as discretionary bonuses to act as incentive mechanisms for achieving corporate goals and objectives. Each NEO receives a base salary in recognition of the position's day-to-day duties and responsibilities, which constitutes the largest share of the NEO's compensation package. The Board of Directors (the " Board ") reviews each NEO's base salary on an annual basis, and may also consider an NEO's qualifications, experience, length of service and past contributions in determining an NEO's base salary.

The Board may also set, throughout the year, discretionary bonuses to serve as incentive mechanisms for the meeting of particular corporate goals and objectives, or for the Company's financial performance. NEOs are also eligible to participate in the Company's stock option plan (the " Option Plan ") and receive grants of stock options thereunder.

Option-Based Awards

The Option Plan is used to attract, retain and incentivize qualified and experienced personnel. The Option Plan is an important part of the Company's long-term incentive strategy for its NEOs, as well as for its other directors, officers, other management, employees and consultants (collectively, " eligible persons "), permitting them to participate in any appreciation of the market value of the Company's common shares over a stated period of time. The Option Plan is designed to foster a proprietary interest in stock ownership, and to reinforce a commitment to the Company's long-term growth, performance and success as well as increasing shareholder value. The Board reviews the grant of stock options to NEOs from time to time, based on various factors such as the NEO's level of responsibility and role and importance in the Company achieving its corporate goals, objectives and prospects. Previous grants of options are taken into account when considering new grants of stock options to NEOs.

The Company has no equity compensation plans other than the Option Plan.

Use of Financial Instruments

The Company does not have a policy that would prohibit a Named Executive Officer or director from purchasing financial instruments, including prepaid variable forward contracts, equity swaps, collars or units of exchange funds, that are designed to hedge or offset a decrease in market value of equity securities granted as compensation or held, directly or indirectly, by the Named Executive Officer or director. However, management is not aware of any Named Executive Officer or director purchasing such an instrument.

NEO Summary Compensation Table

The following table sets out certain information respecting the compensation paid to the NEOs during the three most recently completed financial year(s) in which they were acting in the capacity of an NEO.

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Name and principal position (a)	Year(1) (b)	Salary ($) (c)	Share based awards ($) (d)	Option based awards ($)(2) (e)	Non-equity incentive plan compensation (f)	Non-equity incentive plan compensation (f)	Pension value (g)	All other compensation (h)	Total compensation (i)
					Annual incentive plans (f1)	Long-term incentive plans (f2)
Steven Goldman President, CEO and Director	2020	120,000	n/a	2,874	n/a	n/a	n/a	n/a	122,874
	2019	205,838	n/a	29,591	n/a	n/a	n/a	n/a	235,429
	2018	62,500	n/a	51,885	n/a	n/a	n/a	n/a	114,385
Darren Urquhart CFO	2020	42,000	n/a	575	n/a	n/a	n/a	n/a	42,575
	2019	42,500	n/a	5,430	n/a	n/a	n/a	n/a	47,930
	2018	42,000	n/a	7,005	n/a	n/a	n/a	n/a	49,005

Notes:

• (1) Fiscal year ended September 30.

• (2) Deemed fair value of options granted and vested during the fiscal year, based on the Black-Scholes-Merton model. See audited annual financial statements for the respective fiscal year for the underlying assumptions with respect to options granted in that year.

NEO Incentive Plan Awards

Outstanding Share-Based Awards and Option-Based Awards

The following table sets out certain information respecting each NEO's share-based and option-based awards outstanding at the end of the most recently completed financial year, including awards granted before the most recently completed financial year.

		Option-based Awards	Option-based Awards			Share-based Awards	Share-based Awards
Name (a)	Number of securities underlying unexercised options (1) (#) (b)	Option exercise price (1) ($) (c)	Option expiration date dd/mm/yy (d)	Value of unexercised in-the-money- options(2) ($) (e)	Number of shares or units of shares that have not vested (#) (f)	Market or payout value of share-based awards that have not vested ($) (g)	Market or payout value of vested share- based awards not paid out or distributed ($) (h)
Steven Goldman	150,000 80,000 120,000 60,000 24,000 45,000	0.25 0.25 0.35 0.98 1.25 1.78	04/04/24 15/06/23 30/05/23 01/03/22 17/03/21 15/08/21	Nil Nil Nil Nil Nil Nil	n/a	n/a	n/a
Darren Urquhart	30,000 10,000 20,000 60,000 10,000 36,000	0.25 0.25 0.35 0.98 1.25 1.78	04/04/24 15/06/23 30/05/23 01/03/22 17/03/21 15/08/21	Nil Nil Nil Nil Nil Nil	n/a	n/a	n/a

Notes:

• (1) On May 26, 2020, the Company consolidated its shares on a 5 for 1 basis. All references to common shares, including number of options and option exercise price, have been adjusted to reflect this change.

• (2) Based on the difference between the exercise price of the option and the closing market price of the Company's common shares on the TSX Venture Exchange (the "Exchange") on the last day of the financial year ended September 30, 2020, being $0.165.

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Incentive Plan Awards – Value Vested Or Earned During The Year

The following table sets out certain information respecting the value of each NEO's share-based and option-based awards that became vested or were earned during the most recently completed financial year.

Name	Option-based awards –Value vested during the year(1) ($)	Share-based awards –Value vested during the year ($)	Non-equity incentive plan compensation –Value earned during the year ($)
Steven Goldman	Nil	n/a	n/a
Darren Urquhart	Nil	n/a	n/a

Notes:

(1) For options that became vested during the financial year ended September 30, 2020 and were in-the-money on their vesting date, based on the difference between the exercise price of the option and the closing market price of the Company's common shares on the Exchange on the vesting date.

NEO Termination and Change of Control Benefits

There are no provisions in any contract, agreement, plan or arrangement that provides for payments to a NEO at, following or in connection with any termination (whether voluntary, involuntary or constructive), resignation, retirement, a change of control in the Company or a change in the NEO's responsibilities other than in the agreement between the Company and Darren Urquhart Chartered Accountant Inc., a corporation owned by Mr. Darren Urquhart. Pursuant to the terms of this agreement, Darren Urquhart Chartered Accountant Inc. provides the services of Mr. Darren Urquhart as the Company's Chief Financial Officer. This agreement provides that the Company may terminate the engagement without cause with two months written notice. Furthermore, the agreement provides that in the event of a Change of Control Event, Darren Urquhart Chartered Accountant Inc. shall be paid an amount equal to six times the monthly fees payable under the agreement. If the agreement had been terminated without cause or in connection with a Change of Control event on September 30, 2020 the Company would have been required to make a payment of $7,000 or $21,000, respectively. For the purposes of the agreement a "Change of Control Event" shall be deemed to have occurred when (a) a majority of the directors elected at any annual or special general meeting of shareholders of the Company are not individuals nominated by the Company's then-incumbent board of directors; or (b) all or substantially all of the assets of the Company are transferred to another entity or (c) any person or group of persons acquires the ability, directly or indirectly through one or more intermediaries, to direct or cause the direction of the management and policies of the Company through: (i) the legal or beneficial ownership of voting securities; (ii) the right to appoint managers, directors or corporate management; (iii) contract; (iv) operating agreement; (v) voting trust; (vi) or otherwise.

DIRECTOR COMPENSATION

Director Compensation Table

The following table sets out certain information respecting the compensation paid to directors of the Company who were not NEOs during the Company's most recently completed financial year:

Name (a)	Fees earned ($) (b)	Share-based awards ($) (c)	Option-based awards(1) ($) (d)	Non-equity incentive plan compensation ($) (e)	Pension value ($) (f)	All other compensation ($) (g)	Total ($) (h)
Robert Luffman	12,000	n/a	1,150	n/a	n/a	n/a	13,150
Arnold Tenney	24,000	n/a	1,150	n/a	n/a	n/a	25,150

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Notes:

• (1) Deemed fair value of options granted and vested during the fiscal year, based on the Black-Scholes-Merton model. See audited annual financial statements for the most recently completed financial year for underlying assumptions for options granted in the most recently completed financial year.

Share-based Awards, Option-based Awards and Non-equity Incentive Plan Compensation

Outstanding Share-Based Awards and Option-Based Awards

The following table sets out certain information respecting share-based and option-based awards outstanding at the end of the most recently completed financial year, including awards granted before the most recently completed financial year, for the directors of the Company who were not NEOs.

Name (a)	Number of securities underlying unexercised options (#) (b)	Option-based Awards Option exercise price ($) Option expiration date dd/mm/yy (c) (d)	Option-based Awards Option exercise price ($) Option expiration date dd/mm/yy (c) (d)	Value of unexercised in-the-money options(1) ($) (e)	Number of shares or units of shares that have not vested (#) (f)	Share-based Awards Market or payout value of share-based awards that have not vested ($) Market or payout value of vested share- based awards not paid out or distributed ($) (g) (h)	Share-based Awards Market or payout value of share-based awards that have not vested ($) Market or payout value of vested share- based awards not paid out or distributed ($) (g) (h)
Robert Luffman	60,000 20,000 50,000 60,000	0.25 0.25 0.35 0.98	04/04/24 15/06/23 30/05/23 01/03/22	Nil Nil Nil Nil	n/a	n/a	n/a
Arnold Tenney	60,000 20,000 50,000 60,000 36,000 24,000	0.25 0.25 0.35 0.98 1.78 1.25	04/04/24 15/06/23 30/05/23 01/03/22 15/08/21 17/03/21	Nil Nil Nil Nil Nil Nil	n/a	n/a	n/a

Notes:

• (1) On May 26, 2020, the Company consolidated its shares on a 5 for 1 basis. All references to common shares, including number of options and option exercise price, have been adjusted to reflect this change.

• (2) Based on the difference between the exercise price of the option and the closing market price of the Company's common shares on the Exchange on the last day of the financial year ended September 30, 2020, being $0.165.

Incentive Plan Awards – Value Vested Or Earned During The Year

The following table sets out certain information respecting the value of share-based and option-based awards that became vested or were earned during the most recently completed financial year, for the directors of the Company who were not NEO's.

Name	Option-based awards –Value vested during the year(1) ($)	Share-based awards –Value vested during the year ($)	Non-equity incentive plan compensation –Value earned during the year ($)
Robert Luffman	Nil	n/a	n/a
Arnold Tenney	Nil	n/a	n/a

Notes:

• (1) For options that became vested during the financial year ended September 30, 2020 and were in-the-money on their vesting date, based on the difference between the exercise price of the option and the closing market price of the Company's common shares on the Exchange on the vesting date.