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4. Related Party
 3 Months Ended
Mar. 31, 2020
Related Party Transactions [Abstract]  
Related Party

Note 4 – Related Party

 

On March 1, 2018, the Board of Directors (the “Board”) of the Company approved and adopted the Black Ridge Gas, Inc. 2018 Management Incentive Plan (the “Plan”) and the form of 2018 Management Incentive Plan Award Agreement (the “Award Agreement”).

 

In connection with the approval of the Plan and Award Agreement, the Board approved the issuance of awards (the “Awards”) to certain individuals including officers and directors (the “Grantees”), representing a percentage of the shares of BRAC held by the Company as of the date of closing of a business combination for the acquisition of a target business as described in the BRAC prospectus dated October 4, 2017, as follows:

 

   Percentage of BRAC Shares Owned by the 
Name  Company Granted to the Grantee 
Bradley Berman   1.6% 
Lyle Berman   1.6% 
Benjamin Oehler   1.6% 
Joe Lahti   1.6% 
Kenneth DeCubellis   4.0% 
Michael Eisele   2.8% 
James Moe   2.1% 

 

As of March 31, 2020, and following the AESE merger on August 9, 2019, the Company owned 2,685,500 shares of AESE common stock. As a result, 537,100 shares of AESE common stock (the “AESE Shares”) are committed to employees and directors of the Company. Employees and directors are required to remain in their positions for a one-year period, with certain exceptions, to receive the granted shares. The AESE Shares had a fair market value of $843,247 on March 31, 2020. The Company recognized the $1,396,460 of compensation expense related to the Plan during the year ended December 31, 2019. For the three months ended March 31, 2020, the Company recognized a gain of $553,213 related to the reduction in the value of the shares to be paid to employees on August 9, 2020, which was offset against the Company’s loss on the investment in AESE shares due to changes in the AESE market price between December 31, 2019 and March 31, 2020. Subsequent adjustments will be required each quarter to adjust the deferred compensation liability until the shares can be transferred to the employees.