Equity

6 Months Ended

Jun. 30, 2020

Equity Offering Program

In October 2019, the Company entered into a new equity purchase agreement, (the “2019 Sales Agreement”), with Leviston Resources LLC (“Leviston”), to sell up to $1.25 million in shares of the Company’s common stock from time to time at the Company’s option. Pursuant to the 2019 Sales Agreement, the Company agreed to deliver additional shares of common stock with a value of 5% of the aggregate offering price to Leviston as a commitment fee. As of June 30, 2020, the Company has issued shares with an aggregate sales price of $1.0 million under the 2019 Sales Agreement. The Company issued 284,852 shares in commitment fees to Leviston in 2019.

In February 2019, the Company filed a new shelf registration statement on Form S-3 (the “S-3 Shelf”), for the purchase of up to $50.0 million of the Company’s securities, from time to time. In February 2019, the Company also entered into an equity purchase agreement (the "2019 Equity Agreement") with the Murray Family Office ("Murray FO") for the sale of up to $5.0 million in shares of the Company's common stock from time to time, at the Company’s option, subject to certain restrictions and at a 10% discount to a volume weighted average price.

Effective August 2018, the Company entered into an equity sales agreement with Leviston Resources LLC (the "2018 Sales Agreement") for the sale of up to $2.25 million of the Company's common stock. Through June 30, 2019, the Company had issued 2,327,400 common shares at an average price of $0.74 per share, totaling $1.7 million under the 2018 Sales Agreement. Final proceeds from the 2018 Sales Agreement were received in February 2019, and the 2018 Sales Agreement was terminated.

Following is a reconciliation of the common stock transactions under the 2019 Sales Agreement and the 2018 Sales Agreement for six months ended June 30, 2020, and 2019, respectively:



	Six Months Ended		Six Months Ended
	June 30, 2020		June 30, 2019
Number of shares sold	638,511		2,032,345

Gross cash proceeds	$	242,621	$	1,738,319
Fees	50,070		459,978
Net proceeds	$	192,551	$	1,278,341

Average price per share	$	0.38	$	0.86

Share-Based Compensation

On May 28, 2020, Comstock’s board of directors resolved to grant certain share-based compensation payable to the board of directors, in lieu of cash, in consideration of certain past and current service to the Company and also resolved to grant certain share-based compensation to members of management, including the chief executive officer and other key employees of the company, in consideration of service to the Company. These share-based payments are granted under the previously approved 2011 Equity Compensation Plan. The grant date for both the shares and the options is May 28, 2020.

Board members were granted a total of 135,000 common shares for past services and 180,000 common shares for current services for a total of 315,000 shares. The fair value of common shares issued to board members is $0.56 per share, based on the closing price of Comstock Mining common shares (NYSE: LODE) on May 28, 2020. Compensation cost totaling $176,400 is recorded as a general and administrative expense in the condensed consolidated statements of operations in the three and six months ended June 30, 2020.

Employees were granted 138,800 options to acquire common shares with an exercise price equal to the closing sales price on the date of the grant, or $0.56 per share, and expiring on the second anniversary date of the grant. Fair value of stock options was calculated using a Black-Scholes model with the following inputs: stock price on the grant date and exercise price - $0.56 per share; expected term - 1 year; annualized risk-free rate - 0.17%; and, annualized volatility - 92.91%. Based on these inputs, the fair-value option price is $0.20 per share. Compensation cost for the options issued totaled $27,849 and is recorded in the statements of operations for the three and six months ended June 30, 2020. No options were exercised at June 30, 2020.