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EQUITY-BASED COMPENSATION
12 Months Ended
Jun. 30, 2021
EQUITY-BASED COMPENSATION [Abstract]  
EQUITY-BASED COMPENSATION
11.
EQUITY-BASED COMPENSATION
 
Prior to the Redomiciliation, Piedmont Australia granted share-based awards to its employees, officers, non-employee directors, and other service providers as part of remuneration and incentive arrangements. The principal awards issued under PLL’s stock-based compensation plans included incentive stock options and performance rights. All awards granted under the plans consisted of Piedmont Australia ordinary shares. Effective with the Redomiciliation, outstanding PLL share-based awards were converted to share-based awards of the Company.
 
Stock-based compensation expense is reported within “Exploration and evaluation expenses” and “General and administrative expenses” in the consolidated statements of operations in accordance with the Company’s policy. The Company includes the expense related to stock-based payment arrangements in the same financial statement line item as cash compensation paid to the same employees.

Stock-based compensation expense related to all stock-based incentive plans is included in our consolidated statements of operations as follows:
 
  
Years Ended June 30,
 
  
2021
  
2020
 
Exploration and evaluation expenses
 
$
495,031
  
$
171,151
 
General and administrative expenses
  
824,341
   
299,788
 
Total stock-based compensation expense (1)
 
$
1,319,372
  
$
470,938
 



(1)
For the years ended June 30, 2021 and 2020, the Company did not reflect a tax benefit in the consolidated statements of operations associated with stock-based compensation expense because the Company had a full tax valuation allowance during these periods. As such, the table above does not reflect the tax impacts of stock-based compensation expense.
 
Stock Incentive Plans
 
On March 31, 2021, the Company’s Board of Directors adopted, in connection with the planned Redomiciliation, the Piedmont Lithium Inc. Stock Incentive Plan (“Incentive Plan”). A total of 3,000,000 shares of common stock are reserved for issuance under the Incentive Plan, subject to customary adjustments arising from stock splits and other similar changes that affect the number or kind of common stock outstanding. The Incentive Plan authorized the grant of stock options, stock appreciation rights, restricted stock units and restricted stock, any of which may be performance-based. The Company’s Compensation Committee determines the exercise price for stock options and the base price of stock appreciation rights, which may not be less than the fair market value of the Company’s common stock on the date of grant. Generally, stock options or stock appreciation rights vest after three years of service and expire at the end of ten years. Performance share awards vest if the Company achieves certain pre-established performance targets that are based on specified performance criteria over a performance period of not less than three years.
 
Incentive Option Awards
 
A summary of the Company’s stock option activity for the years ended June 30, 2021 and 2020 is presented in the following table:
 
 
 
Shares
  
Weighted-
Average
Exercise Price
(per share)
  
Weighted-Average
Remaining
Contractual Term
(in years)
  
Aggregate
Intrinsic
Value
 
Outstanding at June 30, 2019
  
846,500
  
$
13.77
   
1.1
  
$
64.39
 
Granted
  
259,500
   
16.15
      
62.01
 
Exercised or Settled
  
(315,000
)
  
7.71
      
70.45
 
Expired
  (254,750
)
  17.13
      61.03
 
Outstanding at June 30, 2020
  
536,250
  

16.88
   
1.6
  

61.28
 
Granted
  
135,004
   
35.14
      
43.02
 
Exercised or Settled
  
(15,000
)
  
12.38
      
65.78
 
Expired
  (263,750
)
  15.97
      62.19
 
Outstanding at June 30, 2021
  
392,504
  

21.16
   
4.1
  

57.00
 
Vested at June 30, 2021
  
261,500
  

14.08
   
1.4
  

64.08
 

The per-share weighted average grant date fair value of stock options granted during the years ended June 30, 2021, and 2020 was $15.26 and $1.20, respectively. The Company has unvested remaining stock compensation expense of $2,895,186 to be recognized through the fourth quarter of 2024. The intrinsic value of stock options exercised was $185,700 and $0 during the years ended June 30, 2021 and 2020, respectively.
 
The following assumptions were used to estimate the fair value of options granted during the years ended June 30, 2021 and 2020:
 
  
Years Ended June 30,
 
  
2021
  
2020
 
Assumptions:
      
Expected life of options (in years)
 
5.3 - 6.3
  
2.7 - 2.8
 
Risk-free interest rate
 
0.9% - 1.2%
 
 
0.3% - 0.5%
 
Assumed volatility
 
50.0%
 
 
70.0%
 
Expected dividend rate
 
0.0%
 
 
0.0%
 
 
Restricted Stock Unit Awards
 
Restricted stock units were granted to employees and non-employee directors on May 19, 2021 based on the market price of the Company’s common stock on the grant date and recognized in compensation expense over the vesting period, subject to the passage of time and the employee’s continued employment during such period. In some instances, such as death, awards may vest concurrently with or following an employee’s termination.
 
A summary of the Company’s restricted stock unit activity for the year ended June 30, 2021 is presented in the following table:

  
Shares
  
Weighted-
Average Grant-
Date Fair Value
 
Unvested at June 30, 2020
  
  
$
 
Granted
  
36,745
   
64.08
 
Vested
  
   
 
Forfeited
  
   
 
Unvested at June 30, 2021
  
36,745
  
$
64.08
 
 
Performance Rights Awards
 
The fair value of performance rights granted is estimated at the date of grant based on the underlying share price (being the seven-day volume weighted average share price prior to issuance). Performance rights are subject to milestones and the performance conditions must be satisfied in order for the performance rights to vest. Upon vesting of performance rights, common stock is automatically issued for no consideration. Each performance right automatically converts into one share of common stock upon vesting of the performance rights. The performance right will expire if a performance condition of a performance right is not achieved by the expiry date. The performance rights outstanding as of June 30, 2021 had the following performance conditions and expiry dates:
 

30,000 Performance Rights subject to the “Integrated Feasibility Study Milestone,” expiring December 31, 2021; and


30,000 Performance Rights subject to the “Construction Milestone,” expiring December 31, 2022.
 
A summary of the Company’s performance stock unit activity for the year ended June 30, 2021 is presented in the following table (underlying shares in thousands):
 
  
Shares
  
Weighted-
Average Grant-
Date Fair Value
 
Unvested at June 30, 2020
  
50,000
  
$
5.20
 
Granted
  
10,000
   
6.50
 
Vested
  
   
 
Forfeited
  
   
 
Unvested at June 30, 2021
  
60,000
  
$
5.42