4. Related Party Transactions and Balances | 6 Months Ended |
Oct. 31, 2013 |
Notes | ' |
4. Related Party Transactions and Balances | ' |
4. Related Party Transactions and Balances |
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Management and administrative services are compensated as per a Service Agreement between the Company and its secretary executed on April 30, 2011, and an Administration Agreement with a related party executed on March 15, 2011, whereby the fee is based on services provided and invoiced by both the secretary and the related party on a monthly basis and the fees are paid in cash when possible or with common stock. The Company also, from time to time, has some of its expenses paid by related parties with the intent to repay. These types of transactions, when incurred, result in payables to related parties in the Company’s consolidated financial statements as a necessary part of funding the Company’s operations. |
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On May 15, 2011, the Company entered into an agreement with a related party wherein the Company has the option to acquire 100% interest in an additional 275 mineral claims located in the same areas in Nevada as the mineral claims previously acquired. Consideration for this acquisition is to be $350,000 cash and 425,000 Series B preferred shares. The related party shall hold a 2% Net Smelter Royalty on these claims. As of October 31, 2013, the option had not been exercised. The Company and the related party have from time to time entered into extension agreements and the option has currently been extended to December 31, 2013. |
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As of October 31, 2013 and April 30, 2013, the Company had payable balances due to related parties totaling $513,165 and $616,948, respectively, which resulted from transactions with significant shareholders. |
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Convertible notes payable – related parties consisted of the following at: |
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| 31-Oct-13 | 30-Apr-13 |
Note payable to related party, no interest, convertible into common stock of the Company at $0.10 per share, imputed interest at 9% per annum | $ 101,000 | $ 101,000 |
Note payable to related party, no interest, convertible into common stock of the Company at $0.10 per share, imputed interest at 9% per annum | 25,000 | 25,000 |
Note payable to related party, no interest, convertible into common stock of the Company at $0.10 per share, imputed interest at 9% per annum | 30,000 | 30,000 |
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| $ 156,000 | $ 156,000 |
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On March 15, 2011, a note payable for $101,000 and accrued interest of $45,097 was sold to a related party. At the date of the transaction, the note was amended to be interest free and convertible into common stock of the Company at a price of $0.10 per share. |
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All convertible notes payable – related parties are convertible 30 days from the first day the Company’s common shares are qualified for trading on the OTC Bulletin Board, which occurred in November 2012. As of October 31, 2013, neither of these convertible notes had been converted and therefore all are in default. |
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There is currently no determinable and active market value for the Company’s common stock. Accordingly, no beneficial conversion feature or derivative liabilities are determinable or have been recognized related to the Company’s convertible notes payable – related parties. These convertible features will be evaluated in subsequent periods for fair value determination. |
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Notes payable – related parties consisted of the following at: |
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| 31-Oct-13 | 30-Apr-13 |
Note payable to related party, with interest at 6% per annum, due September 15, 2013 | $ 24,656 | $ 24,656 |
Note payable to related party, with interest at 6% per annum, due March 8, 2014 | 7,500 | 7,500 |
Note payable to related party, with interest at 6% per annum, due December 5, 2013 | 47,500 | - |
Note payable to related party, with interest at 6% per annum, due February 1, 2014 | 9,000 | - |
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| $ 88,656 | $ 32,156 |
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Accrued interest payable – related parties was $48,371 and $46,107 at October 31, 2013 and April 30, 2013, respectively. |