Related Party Transaction

12 Months Ended

Dec. 31, 2015

Related Party Transactions [Abstract]

Related Party Transaction

13. RELATED PARTY TRANSACTION

On August 11, 2015, the Company entered into a Management Support Agreement (“MSA”) with RCF Management L.L.C., a related company of RCF (“RCFM”), whereby RCFM and the Company agreed that it would be beneficial for RCFM to utilize its experience and knowledge in mining and management to assist the Company with the development of the Temrezli project. Under the terms of the agreement, RCFM will provide guidance to the Company on the development of the Temrezli project, from time to time, as the Company requires. As consideration, the Company will compensate RCFM for the services rendered under the MSA with three payments of $0.5 million, each due upon completion of the following milestones:

● Completion of the Anatolia Transaction;

● Completion of a Board of Directors approved study suitable to initiate construction on the Temrezli project; and

● Completion of project financing for the Temrezli project.

The payments to RCFM will be made in cash or shares of the Company’s common stock, at the Company’s discretion. The number of shares of common stock to be issued will be calculated by dividing the payment amount by 90% of the average of the VWAP during the 20 consecutive trading days ending on the trading day immediately prior to the applicable milestone achievement date.

On November 11, 2015, as a result of the completion of the Anatolia Transaction, and in accordance with the MSA, the Company issued 58,865 shares of common stock to RCFM. The fair market value of these shares on the date of issuance was $0.6 million which was based on the closing price on the date of issuance of $9.48.