|9 Months Ended|
Jun. 30, 2017
|Disclosure of Compensation Related Costs, Share-based Payments [Abstract]|
NOTE 7– STOCK-BASED COMPENSATION
On January 1, 2017, 1.25 million restricted shares, which had vested in September 2016, were issued to an employee.
On January 1, 2017, 33.5 million stock options were granted to 6 employees and 2 directors of the Company. The CEO was not included in the award. The stock options vested 50% on January 1, 2017 and the remaining 50% will vest on January 1, 2018, provided that the option holder continues to serve as an employee or director on the vesting date. The stock options are exercisable for seven years from the original grant date of January 1, 2017, until January 1, 2024.
The fair value of the stock-options were determined using the Black Scholes valuation model with the following key assumptions:
The Company used the historical volatility of its stock for the period March 21, 2013 (the date the exploration activities began) through January 1, 2017 for the Black Scholes computation. The Company has no historical data regarding the expected life of the options and therefore used the simplified method of calculating the expected life. The risk free rate was calculated using the U.S. Treasury constant maturity rates similar to the expected life of the options, as published by the Federal Reserve. The Company has no plans to declare any future dividends.
Stock-based compensation cost is measured at the grant date, using the estimated fair value of the award, and is recognized over the required vesting period. The Company recognized $93,381 and $560,287 in stock-based compensation during the three and nine months ended June 30, 2017, and $174,650 and $582,694 in stock-based compensation during the three and nine months ended June 30, 2016, respectively. A portion of these costs, $27,875 and $99,050, were capitalized to unproved properties and the remainder were recorded as general and administrative expenses for the three months ended June 30, 2017 and 2016, respectively. For the nine months ended June 30, 2017 and 2016, $167,250 and $324,797, respectively, were capitalized to unproved properties.
The following table summarizes the Company’s stock option activity during the nine months ended June 30, 2017:
As of June 30, 2017, remaining expense to be recognized related to outstanding options was $186,763.
As of June 30, 2017 there was zero intrinsic value for stock options outstanding as of June 30, 2017.
The entire disclosure for compensation-related costs for equity-based compensation, which may include disclosure of policies, compensation plan details, allocation of equity compensation, incentive distributions, equity-based arrangements to obtain goods and services, deferred compensation arrangements, employee stock ownership plan details and employee stock purchase plan details.
Reference 1: http://www.xbrl.org/2003/role/presentationRef