10-Q

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

(Mark One)

x QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended October 31, 2014

¨ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from _______________ to _______________.

Commission file number: 333-152608

MMEX RESOURCES CORPORATION

(Exact name of Issuer as specified in its charter)

Nevada	26-1749145
(State or other Jurisdiction of Incorporation or Organization)	(I.R.S. Employer Identification No.)
3616 Far West Blvd. #117-321 Austin, Texas 78731	855-880-0400
(Address of principal executive offices, including zip code)	(Issuer’s telephone number, including area code)

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ¨ No x

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). Yes ¨ No x

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer	¨	Accelerated filer	¨
Non-accelerated filer	¨	Smaller reporting company	x
(Do not check if a smaller reporting company)

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ¨ No x

Applicable only to issuers involved in bankruptcy proceedings during the preceding five years:

Indicate by check mark whether the registrant filed all documents and reports required to be filed by Sections 12, 13 or 15(d) of the Exchange Act of 1934 subsequent to the distribution of securities under a plan confirmed by a court. Yes ¨ No ¨

Applicable only to corporate issuers:

Indicate the number of shares outstanding of each of the issuer’s classes of common stock, as of the latest practicable date. As of December 5, 2016, there were 502,528,410 shares of common stock, $0.001 par value, issued and outstanding.

MMEX RESOURCES CORPORATION

TABLE OF CONTENTS

QUARTER ENDED OCTOBER 31, 2014

PART I – FINANCIAL INFORMATION
Item 1.	Financial Statements	3
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	21
Item 3.	Quantitative and Qualitative Disclosures About Market Risk	25
Item 4.	Controls and Procedures	25
PART II – OTHER INFORMATION
Item 1.	Legal Proceedings	26
Item 1A.	Risk Factors	26
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	26
Item 3.	Defaults Upon Senior Securities	26
Item 4.	Mine Safety Disclosures	26
Item 5.	Other Information	26
Item 6.	Exhibits	27

2

PART I – FINANCIAL INFORMATION

ITEM 1. Financial Statements

The accompanying condensed consolidated financial statements of MMEX Resources Corporation and subsidiaries (the “Company”) are unaudited and have been prepared in accordance with generally accepted accounting principles for interim financial information and in accordance with the instructions for Form 10-Q. Accordingly, they do not include all of the information and notes required by generally accepted accounting principles for complete financial statements.

In the opinion of management, the condensed consolidated financial statements contain all material adjustments, consisting only of normal recurring adjustments, necessary to present fairly the financial condition, results of operations, and cash flows of the Company for the interim periods presented.

Operating results and cash flows for any interim period are not necessarily indicative of the results that may be expected for other interim periods or the full fiscal year. These condensed consolidated financial statements and related notes should be read in conjunction with the consolidated financial statements and notes thereto included in the Company’s Form 10-K for the year ended April 30, 2014 filed with the Securities and Exchange Commission (“SEC”).
 

3

MMEX RESOURCES CORPORATION

Condensed Consolidated Balance Sheets

	October 31, 2014			April 30, 2014
	(Unaudited)
Assets
Current assets:
Cash	$	141		$	434
Deferred loan costs – short term		10,000			10,000
Total current assets		10,141			10,434
Property and equipment, net		4,836			7,338
Other assets:
Deferred loan costs – long term		3,822			8,822
Deposits		10,000			10,000
Total assets	$	28,799		$	36,594
Liabilities and Stockholders’ Deficit
Current liabilities:
Accounts payable	$	660,704		$	657,426
Accounts payable – related party		8,033			8,033
Accrued expenses		1,544,267			1,396,206
Accrued expenses – related party		1,515,767			1,159,608
Notes payable, currently in default		375,000			375,000
Convertible notes payable, net of discount of $0 and $0 at October 31, 2014 and April 30, 2014, respectively, currently in default		2,145,001			2,145,001
Convertible notes payable – related party, net of discount of $72 and $0 at October 31, 2014 and April 30, 2014, respectively, currently in default		129,895			119,967
Convertible preferred stock, currently in default		137,500			137,500
Preferred stock – mandatory redemption right, net of discount of $529,304 and $645,172 at October 31, 2014 and April 30, 2014, respectively		470,696			354,828
Total current liabilities		6,986,863			6,353,569
Commitments and contingencies
Stockholders’ deficit:
Common stock; $0.001 par value, 3,000,000,000 shares authorized, 57,188,313 shares issued and outstanding at October 31, 2014 and April 30, 2014		57,189			57,189
Common stock payable		90,000			90,000
Additional paid-in capital		20,215,398			20,215,284
Non-controlling interest		(368,685	)		(368,178	)
Accumulated (deficit)		(26,951,966	)		(26,311,270	)
Total stockholders’ deficit		(6,958,064	)		(6,316,975	)
Total liabilities and stockholders’ deficit	$	28,799		$	36,594

See accompanying notes to condensed consolidated financial statements.

4

MMEX RESOURCES CORPORATION

Condensed Consolidated Statements of Operations
(Unaudited)

	Three Months Ended						Six Months Ended
	October 31,						October 31,
	2014			2013			2014			2013
Revenues	$	-		$	-		$	-		$	-
Operating expenses:
Selling, general and administrative expenses		189,941			272,810			385,169			550,344
Depreciation and amortization		1,251			1,250			2,502			2,502
Total operating expenses		191,192			274,060			387,671			552,846
Loss from operations		(191,192	)		(274,060	)		(387,671	)		(552,846	)
Other (expense):
Interest expense		(131,002	)		(155,216	)		(253,532	)		(390,283	)
Total other (expense)		(131,002	)		(155,216	)		(253,532	)		(390,283	)
Loss before income taxes		(322,194	)		(429,276	)		(641,203	)		(943,129	)
Provision for income taxes		-			-			-			-
Net loss		(322,194	)		(429,276	)		(641,203	)		(943,129	)
Non-controlling interest in loss of consolidated subsidiaries		254			349			507			672
Net loss attributable to the Company	$	(321,940	)	$	(428,927	)	$	(640,696	)	$	(942,457	)
Weighted average number of common shares outstanding – basic and diluted		57,188,313			57,188,313			57,188,313			57,188,313
Net loss per common share – basic and diluted	$	(0.01	)	$	(0.01	)	$	(0.01	)	$	(0.02	)

See accompanying notes to condensed consolidated financial statements.

 

5

MMEX RESOURCES CORPORATION

Condensed Consolidated Statements of Cash Flows
(Unaudited)

	Six Months Ended October 31,
	2014			2013
Cash flows from operating activities:
Net loss attributable to the Company	$	(640,696	)	$	(942,457	)
Non-controlling interest in net loss		(507	)		(672	)
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation and amortization expense		2,502			2,502
Amortization of debt discount		115,910			266,008
Amortization of deferred loan costs		5,000			5,000
Increase in liabilities:
Accounts payable		3,278			15,292
Accrued expenses		504,220			599,152
Net cash used in operating activities		(10,293	)		(55,175	)
Cash flows from investing activities
Purchase of property and equipment		-			-
Net cash used in investing activities		-			-
Cash flows from financing activities:
Proceeds from convertible notes payable – related party		10,000			54,641
Net cash provided by financing activities		10,000			54,641
Net decrease in cash		(293	)		(534	)
Cash at the beginning of the period		434			729
Cash at the end of the period	$	141		$	195

Supplemental disclosure:
Interest paid	$	-	$	-
Income taxes paid		-		-
Non-cash investing and financing activities:
Convertible debt beneficial conversion feature	$	114	$	-

See accompanying notes to condensed consolidated financial statements.

 

6

MMEX RESOURCES CORPORATION

Notes to Condensed Consolidated Financial Statements

Six Months Ended October 31, 2014
(Unaudited)

NOTE 1 – BACKGROUND, ORGANIZATION AND BASIS OF PRESENTATION

MMEX Resources Corporation (the “Company” or “MMEX”) was formed in the State of Nevada on May 19, 2005 as Inkie Entertainment Group, Inc. On April 6, 2016, the Company amended its articles of incorporation to change its name to MMEX Resources Corporation and to authorize the Company to issue up to 1,000,000,000 common shares and 10,000,000 preferred shares. The changes in the number of authorized shares of the Company have been given retroactive effect in the accompanying condensed consolidated financial statements. The Board of Directors of the Company has made the decision to focus efforts on the oil, gas, refining and electric power business in the United States and Latin America.

The accompanying condensed consolidated financial statements include the accounts of the following entities, all of which the Company maintains control through a majority ownership:

Name of Entity	%	Form of Entity	State of Incorporation	Relationship
MMEX Resources Corporation (“MMEX”)	-	Corporation	Nevada	Parent
MCC Merger, Inc. (“MCCM”)	100%	Corporation	Delaware	Holding Subsidiary
Maple Carpenter Creek Holdings, Inc. (“MCCH”)	100%	Corporation	Delaware	Subsidiary
Maple Carpenter Creek, LLC (“MCC”)	80%	LLC	Nevada	Subsidiary
Carpenter Creek, LLC (“CC”)	95%	LLC	Delaware	Subsidiary
Armadillo Holdings Group Corp. (“AHGC”)	100%	Corporation	British Virgin Isles	Subsidiary
Armadillo Mining Corp. (“AMC”)	98.6%	Corporation	British Virgin Isles	Subsidiary

All significant inter-company transactions have been eliminated in the preparation of the condensed consolidated financial statements.

These financial statements reflect all adjustments, consisting of normal recurring adjustments, which in the opinion of management are necessary for a fair presentation of the information contained therein.

The Company has adopted a fiscal year end of April 30.

NOTE 2 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Our significant accounting policies are described in our Annual Report on Form 10-K for the year ended April 30, 2014 filed with the SEC on April 15, 2016.

Use of Estimates

The preparation of financial statements in conformity with accounting principles generally accepted in the United States requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, and the disclosure of contingent assets and liabilities at the date of the financial statements, and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates.

 

7

Income or Loss Per Share

Basic income or loss per share is calculated by dividing net income or loss (available to common stockholders) by the weighted average number of common shares outstanding for the period. Diluted income or loss per share reflects the potential dilution that could occur if securities or other contracts to issue common stock, such as stock options, warrants, convertible preferred stock and convertible debentures, were exercised or converted into common stock. For the three months and six months ended October 31, 2014 and 2013, potential dilutive securities had an anti-dilutive effect and were not included in the calculation of diluted net loss per common share.

Therefore, basic loss per share is the same as diluted loss per share and the weighted average number of common shares outstanding was 57,188,313 for each of the three and six-month periods ended October 31, 2014 and 2013.

Issuance of Shares for Non-Cash Consideration

The Company accounts for the issuance of equity instruments to acquire goods and/or services based on the fair value of the goods and services or the fair value of the equity instrument at the time of issuance, whichever is more reliably determinable. The Company's accounting policy for equity instruments issued to consultants and vendors in exchange for goods and services follows the provisions of the standards issued by the Financial Accounting Standards Board (“FASB”). The measurement date for the fair value of the equity instruments issued is determined as the earlier of (i) the date at which a commitment for performance by the consultant or vendor is reached or (ii) the date at which the consultant or vendor's performance is complete. In the case of equity instruments issued to consultants, the fair value of the equity instrument is recognized over the term of the consulting agreement.

Reclassifications

Certain amounts in the condensed consolidated financial statements for the prior year periods have been reclassified to conform with the current year presentation.

Recently Issued Accounting Pronouncements

In October 2016, the FASB issued Accounting Standards Update (“ASU”) No. 2016-17, “Consolidation (Topic 810): Interests Held Through Related Parties That are Under Common Control.” This update amends the consolidation guidance on how a reporting entity that is the single decision maker of a variable interest entity (“VIE”) should treat indirect interests in the entity held through related parties that are under common control with the reporting entity when determining whether it is the primary beneficiary of that VIE. The primary beneficiary of a VIE is the reporting entity that has a controlling financial interest in a VIE and, therefore, consolidates the VIE. A reporting entity has an indirect interest in a VIE if it has a direct interest in a related party that, in turn, has a direct interest in the VIE. The amendments in this ASU are effective for public business entities for fiscal years beginning after December 15, 2016, including interim periods within those fiscal years. Early adoption is permitted, including adoption in an interim period. If an entity early adopts the amendments in an interim period, any adjustments should be reflected as of the beginning of the fiscal year that includes that interim period. The Company is currently unable to determine the impact on its consolidated financial statements of the adoption of this new accounting pronouncement.

 

8

In August 2016, the FASB issued ASU No. 2016-15, “Statement of Cash Flows (Topic 230): Classification of Certain Cash Receipts and Cash Payments.” This ASU addresses eight specific cash flow issues with the objective of reducing the existing diversity in practice. The amendments in this ASU are effective for public business entities for fiscal years beginning after December 15, 2017, and interim periods within those fiscal years. Early adoption is permitted. The Company is currently unable to determine the impact on its consolidated financial statements of the adoption of this new accounting pronouncement.

In March 2016, the FASB issued ASU No. 2016-09, "Stock Compensation (Topic 718)", which is intended to simplify several aspects of the accounting for share-based payment award transactions, including the income tax impacts, the classification on the statement of cash flows, and forfeitures. The amendments in this ASU are effective for fiscal years beginning after December 15, 2016, including interim periods. The Company is currently unable to determine the impact on its consolidated financial statements of the adoption of this new accounting pronouncement.

In February 2016, the FASB issued ASU No. 2016-02, "Leases (Topic 842)". The amendments in this ASU revise the accounting related to lessee accounting. Under the new guidance, lessees will be required to recognize a lease liability and a right-of-use asset for all leases. The new lease guidance also simplifies the accounting for sale and leaseback transactions primarily because lessees must recognize lease assets and lease liabilities. The amendments in this ASU are effective for public companies for fiscal years beginning after December 15, 2018 and are to be applied through a modified retrospective transition approach for leases existing at, or entered into after, the beginning of the earliest comparative period presented in the financial statements. Early adoption is permitted. The Company is currently unable to determine the impact on its consolidated financial statements of the adoption of this new accounting pronouncement.

In April 2015, the FASB issued ASU No. 2015-03, "Interest – Imputation of Interest (Subtopic 835-30), Simplifying the Presentation of Debt Issuance Costs." To simplify presentation of debt issuance costs, the amendments in this Update require that debt issuance costs related to a recognized debt liability be presented in the balance sheet as a direct deduction from the carrying amount of that debt liability, consistent with debt discounts. The recognition and measurement guidance for debt issuance costs are not affected by the amendments in this Update. For public companies, the amendments in this Update are effective for financial statements issued for fiscal years beginning after December 15, 2015 and interim periods within those fiscal years. The Company is currently unable to determine the impact on its consolidated financial statements of the adoption of this new accounting pronouncement.

In August 2014, the FASB issued Accounting Standards Update (“ASU”) No. 2014-15, “Presentation of Financial Statements – Going Concern (Subtopic 310-40): Disclosure of Uncertainties about an Entity's Ability to Continue as a Going Concern.” The amendments in this Update provide guidance in GAAP about management's responsibility to evaluate whether there is substantial doubt about an entity's ability to continue as a going concern and to provide related footnote disclosures. In doing so, the amendments are intended to reduce diversity in the timing and content of footnote disclosures. The amendments are effective for the annual period ending after December 15, 2016, and for annual periods and interim periods thereafter. Early application is permitted. The Company has not determined the impact of the future adoption of the provisions of ASU No. 2014-15 on its consolidated financial statements.

Although there are several other new accounting pronouncements issued or proposed by the FASB, which the Company has adopted or will adopt, as applicable, the Company does not believe any of these accounting pronouncements has had or will have a material impact on its consolidated financial position or results of operations.

9

NOTE 3 – GOING CONCERN

Our financial statements are prepared using accounting principles generally accepted in the United States of America applicable to a going concern, which contemplate the realization of assets and liquidation of liabilities in the normal course of business. We have incurred continuous losses from operations, have an accumulated deficit of $26,951,966 and a total stockholders’ deficit of $6,958,064 at October 31, 2014, and have reported negative cash flows from operations since inception. In addition, we do not currently have the cash resources to meet our operating commitments for the next twelve months, and we expect to have ongoing requirements for capital investment to implement our business plan. Finally, our ability to continue as a going concern must be considered in light of the problems, expenses and complications frequently encountered by entrance into established markets and the competitive environment in which we operate.

Since inception, our operations have primarily been funded through private debt and equity financing, as well as capital contributions by our subsidiaries' partners, and we expect to continue to seek additional funding through private or public equity and debt financing.

Our ability to continue as a going concern is dependent on our ability to generate sufficient cash from operations to meet our cash needs and/or to raise funds to finance ongoing operations and repay debt. However, there can be no assurance that we will be successful in our efforts to raise additional debt or equity capital and/or that our cash generated by our operations will be adequate to meet our needs. These factors, among others, indicate that we may be unable to continue as a going concern for a reasonable period of time.

The financial statements do not include any adjustments that might result from the outcome of any uncertainty as to the Company's ability to continue as a going concern. The financial statements also do not include any adjustments relating to the recoverability and classification of recorded asset amounts, or amounts and classifications of liabilities that might be necessary should the Company be unable to continue as a going concern.

NOTE 4 – RELATED PARTY TRANSACTIONS

During the past few years, Tydus Richards, the former Chairman of our board of directors and shareholder, made certain payments on behalf of the Company. The Company has partially reimbursed Mr. Richards for these advances. As of October 31, 2014 and April 30, 2014, a remaining balance of $31,633 included in accrued expenses – related party remains outstanding.

On September 4, 2010, MCCH entered into an employment agreement with the Company's CEO, Jack W. Hanks, for a two-year term, automatically renewable for one-year terms thereafter, at an annual compensation of $300,000 per year.

On September 4, 2010, MCCH entered into a consulting agreement with Bruce N. Lemons, one of the Company's two directors, for a two-year term, automatically renewable for one-year terms thereafter, at an annual compensation of $170,000 per year.

Accrued expenses (see Note 6) to related parties totaled $1,515,767 and $1,159,608 as of October 31, 2014 and April 30, 2014, respectively.

10

Convertible notes payable – related party, currently in default, consisted of the following at:

	October 31, 2014			April 30, 2014
Note payable to BNL Family Partners, LLC, a related party, with interest at 15%, convertible at the option of the holder into common shares of the Company at a fixed conversion price of $0.025 per share	$	53,530		$	53,530
Note payable to BNL Family Partners, LLC, a related party, maturing June 30, 2015, with interest at 15%, convertible at the option of the holder into common shares of the Company at a fixed conversion price of $0.025 per share		10,000			-
Note payable to Delavega Trading Ltd., a related party, maturing June 20, 2015, with interest at 15%, convertible at the option of the holder into common shares of the Company at a fixed conversion price of $0.25 per share		27,100			27,100
Note payable to Maple Gas Corporation, a related party, with interest at 15%, convertible at the option of the holder into common shares of the Company at a fixed conversion price of $0.025 per share		39,337			39,337
Total		129,967			119,967
Less discount		(72	)		-
Net	$	129,895		$	119,967

BNL Family Partners Convertible Notes

On September 15, 2012, the Corporation entered into a $4,500 convertible note agreement with BNL Family Partners, LLC, a related party. Mr. Bruce N. Lemons, a director of the Corporation, is a partner of BNL Family Partners. The note carries a 20% interest rate until maturity at September 30, 2013 and is convertible into common shares of the Company at the holder's option at $0.20 per share. The holder may accelerate repayment of the promissory notes upon the Company raising additional capital of $150,000. The computed interest of $900 was added to the balance of the note and recorded as additional debt discount. In addition, the Company issued 4,500 warrants valued at $800 using the Black-Scholes option pricing model. The value of the warrants of $800 was recorded as an increase to debt discount and to additional paid-in capital. The warrants are exercisable at an exercise price of $0.30 per common share until September 15, 2015. The note is currently in default.

On April 30, 2014, the Company converted the note payable described above and additional advances from BNL Family Partners into a single $48,130 convertible note agreement with BNL Family Partners. The holder may accelerate repayment of the promissory note upon the Corporation raising additional capital of $1,000,000. The holder may also convert the note into common shares of the Company at the holder's option at $0.025 per Common Share. As the conversion option is above the value of the stock on the date of conversion, no beneficial conversion feature was recorded with this note.

 

11

On June 20, 2014, the Company entered into a $10,000 convertible note agreement with BNL Family Partners. The note carries a 15% interest rate until maturity on June 20, 2015 and is convertible into common shares at the holder's option at $0.025 per common share. The Company issued 10,000 warrants valued at $114 using the Black-Scholes option pricing model. The value of the warrants of $114 was recorded as an increase to debt discount and to additional paid-in capital. The warrants are exercisable at an exercise price of $0.05 per common share until June 30, 2017.

Delavega Trading Ltd. Convertible Notes

On August 1, 2012, the Company entered into a $13,000 convertible note agreement with Delavega Trading Ltd., a related party. Mr. Nabil Katabi, a director of the Company, is a control person of Delavega Trading Ltd. The note carries a 20% interest rate until maturity at September 30, 2013 and is convertible into common shares of the Company at the holder's option at $0.20 per common share. The computed interest of $2,600 was added to the balance of the note and recorded as additional debt discount. In addition, the Company issued 13,000 warrants valued at $1,292 using the Black-Scholes option pricing model. The value of the warrants of $1,292 was recorded as an increase to debt discount and to additional paid-in capital. The warrants are exercisable at an exercise price of $0.30 per common share until August 1, 2015. The note is currently in default.

On December 17, 2012, the Company entered into a $6,500 convertible note agreement with Delavega Trading Ltd. The note carries a 20% interest rate until maturity at December 17, 2013 and is convertible into common shares of the Company at the holder's option at $0.20 per common share. The computed interest of $1,300 was added to the balance of the note and recorded as additional debt discount. In addition, the Company issued 6,500 warrants valued at $549 using the Black-Scholes oprtion pricing model. The value of the warrants of $549 was recorded as an increase to debt discount and to additional paid-in capital. The warrants are exercisable at an exercise price of $0.30 per common share until December 17, 2015. The note is currently in default.

On April 30, 2014, the Company converted the notes payable described above and associated accrued interest to and additional advances from Delavega Trading Ltd. into a single $27,100 convertible note agreement with Delavega Trading Ltd. The holder may accelerate repayment of the promissory note upon the Company raising additional capital of $1,000,000. The holder may also convert the note into common shares of the Company at the holder's option at $0.025 per Common Share. As the conversion option was above the value of the stock on the date of conversion, no beneficial conversion feature was recorded with this note.

Maple Gas Advances

During the year ended April 30, 2014, Maple Gas Corporation, a related party owned by Mr. Jack W. Hanks, a director and officer of the Company, advanced funds or incurred expenses on behalf of the Company. On April 30, 2014, the Company entered into a $39,337 convertible note agreement with Maple Gas Corporation for the total advances to that date. The note carries a 15% interest rate. The holder may accelerate repayment of the promissory note upon the Company raising additional capital of $1,000,000. The holder may also convert the note into common shares of the Company at the holder's option at $0.025 per common share. As the conversion option was above the value of the stock on the date of conversion, no beneficial conversion feature was recorded with this note.

The debt discount resulting from interest and the value of warrants computed at the inception of the convertible notes payable – related party is amortized over the term of the notes as additional interest expense. During the three months ended October 31, 2014 and 2013, debt discount amortized to interest expense totaled $29 and $0, respectively. During the six months ended October 31, 2014 and 2013, debt discount amortized to interest expense totaled $42 and $0, respectively. As of October 31, 2014, the debt discount had a balance of $72.

The above convertible notes payable – related party were subsequently forgiven, with the obligations contributed to capital – see Note 12.

 

12

NOTE 5 – PROPERTY AND EQUIPMENT

Property and equipment consisted of the following at:

	October 31, 2014			April 30, 2014
Computer software and hardware	$	25,023		$	25,023
Less accumulated depreciation and amortization		(20,187	)		(17,685	)
	$	4,836		$	7,338

Depreciation and amortization expense totaled $1,251 and $1,250 for the three months ended October 31, 2014 and 2013, respectively, and $2,502 for each of the six months ended October 31, 2014 and 2013.

NOTE 6 – ACCRUED EXPENSES

Accrued expenses consisted of the following at:

	October 31, 2014		April 30, 2014
Accrued payroll	$	973,798	$	725,817
Accrued consulting		1,260,054		1,083,616
Accrued dividend		360,685		310,685
Accrued interest		402,956		373,154
Other		62,541		62,541
	$	3,060,034	$	2,555,813

NOTE 7 – NOTES PAYABLE

Notes payable, currently in default, consist of the following at:

	October 31, 2014		April 30, 2014
Note payable to an unrelated party, maturing July 15, 2010, with interest at 10%	$	300,000	$	300,000
Note payable to an unrelated party, maturing December 31, 2010, with interest at 10%		25,000		25,000
Note payable to an unrelated party, maturing January 27, 2012, with interest at 25%		50,000		50,000
	$	375,000	$	375,000

 

13

Accrued interest payable on notes payable, currently in default, totaled $214,602 and $193,977 at October 31, 2014 and April 30, 2014, respectively.

Convertible notes payable, currently in default, consist of the following at:

	October 31, 2014		April 30, 2014
Note payable to an accredited investor, maturing July 31, 2013, with interest at 10%, convertible at the option of the holder into common shares of the Company at a fixed conversion price of $0.20 per share, secured with 2,995,000 common shares of the Company	$	1,650,000	$	1,650,000
Note payable to an accredited investor, maturing October 31, 2013, with interest at 20%, convertible at the option of the holder into common shares of the Company at a fixed conversion price of $0.20 per share		120,000		120,000
Note payable to an accredited investor, maturing February 1, 2014, with interest at 20%, convertible upon default at the option of the holder into common shares of the Company at a fixed conversion price of $0.20 per share		180,000		180,000
Note payable to an accredited investor, maturing March 1, 2013, with interest at 1.87% per month, secured with 900,000 common shares of the Company owned by the president and CEO of the Company		120,000		120,000
Note payable to an unrelated party, maturing March 18, 2014, with interest at 10%		75,001		75,001
Total		2,145,001		2,145,001
Less discount		-		-
Net	$	2,145,001	$	2,145,001

On April 25, 2012, four prior convertible notes payable to an accredited investor were combined into a new $1,500,000 note. The note was due and payable on July 31, 2013. The note bears interest at 10% due at maturity. The computed interest of $150,000 was added to the balance of the note and recorded as additional debt discount. The note is convertible at the option of the holder into shares of the Company’s common stock at a fixed conversion price of $0.20 per share. The note was subsequently transferred to a related party and converted to common shares of the Company – see Note 12.

On August 15, 2012, the Company entered into a $100,000 convertible note agreement with an accredited investor. The note is subject to a 20% placement fee payable to the holder irrespective of the date redeemed, matures on October 31, 2013 and is convertible at the option of the holder into shares of the Company’s common stock at a fixed conversion price of $0.20 per share. The note is currently in default. The computed interest of $20,000 was added to the balance of the note and recorded as additional debt discount. In addition, the Company issued 120,000 warrants valued at $14,232 using the Black-Scholes option pricing model. The value of the warrants of $14,232 was recorded as an increase to debt discount and to additional paid-in capital. The warrants are exercisable at an exercise price of $0.30 per common share until August 15, 2015. The note was subsequently transferred to a related party and converted to common shares of the Company – see Note 12.

 

14

On February 1, 2013, the Company entered into a $150,000 convertible note agreement with an unrelated party. The note was due and payable on February 1, 2014, is currently in default and carries an interest rate of 20%. The note is convertible upon default at the option of the holder into shares of the Company’s common stock at a fixed conversion price of $0.20 per share. The computed interest of $30,000 was added to the balance of the note and recorded as additional debt discount. In addition, the Company issued 150,000 warrants valued at $16,103 using the Black-Scholes option pricing model. The value of the warrants of $16,103 was recorded as an increase to debt discount and to additional paid-in capital. The warrants are exercisable at an exercise price of $0.20 per common share on or before three years from the repayment or conversion date. The note was subsequently transferred to a related party and converted to common shares of the Company – see Note 12.

On January 2, 2013, the Company closed a note purchase agreement with an accredited investor pursuant to which the Company sold a $120,000 note in a private placement transaction. The note was due and payable on March 1, 2013, is currently in default and carries a monthly interest rate of 1.87%. The note purchase agreement included the issuance of 300,000 shares of the Company’s common stock. The note is secured with 900,000 shares of the Company’s common stock owned by Jack Hanks, the Company’s President and CEO. The 300,000 shares were valued at $0.10 per share, the closing price of the Company’s common stock on January 2, 2013, and recorded as a $30,000 increase to debt discount and an increase to common stock payable.

The Company allocated the proceeds from the issuance of the notes to the warrants when applicable and to the notes based on their estimated fair market values at the date of issuance using the Black-Scholes option pricing model. The debt discount resulting from interest and the value of warrants computed at the inception of the notes payable is amortized over the term of the notes as additional interest expense and was fully amortized as of April 30, 2014.

NOTE 8 – CONVERTIBLE PREFERRED STOCK

Preferred Stock – Mandatory Redemption Right

On March 22, 2011, the Company issued 1,000,000 shares of Series A Preferred Stock (the “Preferred Stock”) to an unrelated party in exchange for an investment of $1,000,000. The shares may be converted into the Company’s common shares at $0.40 per common share. The Preferred Stock carry a 10% cumulative dividend and have a mandatory redemption feature on the earlier of March 1, 2016 or on a change of control transaction. The Company is required to redeem the shares at a liquidation value of $1.00 per share plus any accrued and unpaid dividends. Due to the mandatory redemption feature, the Company recorded the investment as a liability under ASC Subtopic 480-10.

The Company recorded the intrinsic value of the beneficial conversion of $1,000,000 as debt discount and will amortize the discount through the mandatory redemption feature date of March 1, 2016. During the three months ended October 31, 2014 and 2013, amortization of debt discount to interest expense totaled $62,020 and $35,245, respectively. During the six months ended October 31, 2014 and 2013, amortization of debt discount to interest expense totaled $115,868 and $65,845, respectively. The investment is collateralized with a security interest in 2,500,000 shares of the Company’s common stock.

Loan costs of $50,000 incurred on the issuance of the Preferred Stock were recorded as deferred loan costs and will be amortized by the effective interest method. The Company recorded amortization on loan costs in the amount of $2,500 for each of the three months ended October 31, 2014 and 2013 and $5,000 for each of the six months ended October 31, 2014 and 2013, respectively. Unpaid dividends payable on the Preferred Stock totaled $360,685 and $310,685 at October 31, 2014 and April 30, 2014, respectively.

On August 15, 2012, the Company amended the Preferred Stock agreement and lowered the conversion rate provided from $0.40 per common share to $0.20 per common share. The amendment generated a $302,694 fair value adjustment that was recorded as additional interest and increased additional paid in capital.

The Preferred Stock and related accrued dividends were subsequently transferred to a related party and converted into common shares of the Company – see Note 12.

 

15

Convertible Preferred Stock, Currently in Default

On June 30, 2011, the Company issued 360,000 shares of Armadillo Mining Corporation Preferred Stock to five unrelated parties in exchange for an investment of $360,000. The Preferred Stock carry a 25% cumulative dividend and have a mandatory redemption feature on December 31, 2011 at a price of $1.25 per share. In addition, the Company issued 360,000 warrants to purchase shares of the Company’s common stock at an exercise price of $0.60 per share on or before three years from the repayment or conversion date.

On January 6, 2012, three unrelated parties converted their Preferred Stock and accrued dividends of $312,500 into 2,983,293 shares of the Company’s common stock at a price of $.10475 per share. As the conversion took place at below the market price and not within the terms of the agreement on the date of conversion, a loss of $75,328 was recorded. As of October 31, 2014 and April 30, 2014, the remaining face value of the Preferred Stock was $137,500. Accrued dividends on the Preferred Stock totaled $178,665 and $144,289 as of October 31, 2014 and April 30, 2014, respectively.

The Company recorded interest expense, which includes amortization of debt discount on certain debt described above, totaling $131,002 and $155,216 for the three months ended October 31, 2014 and 2013, respectively, and totaled $253,532 and $390,283 for the six months ended October 31, 2014, respectively.

NOTE 9 – STOCKHOLDERS’ DEFICIT

Authorized Shares

Pursuant to amendments to its articles of incorporation (Note 12), the Company increased its authorized shares to 1,000,000,000 common shares and 10,000,000 preferred shares and subsequently increased its authorized common shares to 3,000,000,000 shares. The increase in authorized shares has been given retroactive effect in the accompanying condensed consolidated financial statements for all periods presented.

Stock Issuances

During the six months ended October 31, 2014, the Company did not issue any shares of its common or preferred stock.

Stock Options

On March 7, 2012, three directors of the Company (the "Optionees") received a total of 2,000,000 unvested stock options exercisable at $0.35 per share for common stock of the Company: after service of one year, 50% will be vested, and after service of the second year the remaining 50% will become vested; with an actual term of ten years from the date of grant. The Company did not grant any stock options during the six months ended October 31, 2014.

The Company uses the Black-Scholes option pricing model to estimate the grant date fair value of its stock options, which value is amortized to stock-based compensation expense over the vesting period of the options. No stock-based compensation expense was recorded during the three months and six months ended October 31, 2014 and 2013 related to stock option grants. There was no unrecognized stock option expense at October 31, 2014.

 

16

A summary of stock option activity during the six months ended October 31, 2014 is presented below:

	Shares		Weighted Average Exercise Price		Weighted Average Remaining Contractual Life (Years)
Outstanding, April 30, 2014		2,000,000	$	0.35	8.83
Granted		-		-
Canceled / Expired		-		-
Exercised		-		-
Outstanding, October 31, 2014		2,000,000	$	0.35	8.33

Warrants

The Company has issued warrants to non-employees for either debt discounts or stock-based compensation. These warrants generally vested upon grant and were valued using the Black-Scholes option pricing model. During the quarter ended July 31, 2014, the Company issued warrants to purchase 10,000 shares of common stock to a related party lender.

A summary of warrant activity during the six months ended October 31, 2014 is presented below:

	Shares		Weighted Average Exercise Price		Weighted Average Remaining Contractual Life (Years)
Outstanding, April 30, 2014		32,865,345	$	0.33	1.42
Granted		10,000	$	0.05
Canceled / Expired		-		-
Exercised		-		-
Outstanding, October 31, 2014		32,875,345	$	0.33	0.92

 

17

Common Stock Reserved

At October 31, 2014, 49,350,984 shares of the Company’s common stock were reserved: 16,485,639 for debt conversion purposes and 32,875,345 for issuance of outstanding warrants.

NOTE 10 – NON-CONTROLLING INTERESTS

On September 23, 2010, the Company, through a reverse merger, acquired 100% of the outstanding shares of Maple Carpenter Creek Holdings, Inc., ("MCCH"), a holding Company, with an 80% interest in Maple Carpenter Creek, LLC ("MCC"), which in turn owned a 95% interest in the subsidiary, Carpenter Creek, LLC ("CC"), and a 98.12% interest in Armadillo Holdings Group Corp. ("AHGC"), which in turn owned an 80% interest in Armadillo Mining Corp. ("AMC"). The non-controlling interest of 1.88% in AHGC was acquired by MCCH on December 21, 2010 in exchange for 31,334 shares of the Company’s common stock resulting in 100% ownership of AHGC. On March 22, 2011, AHGC acquired 14.6% of AMC and on April 30, 2012, an additional 4% interest for a total of 98.6% based upon agreement with the minority interest holder to reduce their interest based upon proportionate share of additional capital contributed to AMC.

NOTE 11 – COMMITMENTS AND CONTINGENCIES

Legal

There were no legal proceedings against the Company.

Operating Lease Commitments

The Company acquired the Bolzer Lease pursuant to a September 23, 2010 merger. Subsequently, notice of termination on this lease effective April 26, 2010 was provided by previous management. The Company has recorded an accrued expense for the minimum lease payment of $62,541 for the January 2010 payment.

NOTE 12 – SUBSEQUENT EVENTS

In accordance with ASC 855-10, all subsequent events have been reported through the filing date as set forth below.

Convertible Notes Payable – Related Parties

In May 2015, BNL Family Partners, Delavega Trading Ltd. and Maple Gas Corporation, related parties (see Note 4) agreed to forgive certain indebtedness. The reduction of the notes payable and related accrued interest payable was recorded as a contribution to capital.

 

18

Transfer of Coal Assets

As of April 30, 2014, the Company had interests in coal prospects in Colombia, South America. As of May 18, 2015, the Board of Directors of the Company approved a transfer its coal assets in Colombia to a trust for the benefit of its existing shareholders with an effective date as of April 13, 2016. The shareholders of the Company have the same allocated share ownership interests in the trust that they had in the Company as of the effective date of the transfer, which is as of April 13, 2016. In addition, the shareholders of the Company have the same ownership interests in the Company subject to the dilution by the acquisition of Maple Structure Holdings, LLC of the purchase of the Preferred Shares and selected debt of the Company, and then the subsequent conversion of those Instruments into equity in the Company at US$0.01 per share. That conversion results in a substantial dilution of existing shareholders including majority shareholder ownership. See below for details of the dilution.

Amendment of Articles of Incorporation

As of April 6, 2016, the Company amended its articles of incorporation to change its corporate name from MMEX Mining Corporation to MMEX Resources Corporation and to increase its authorized shares to 1,000,000,000 common shares and 10,000,000 preferred shares.

As of November 29, 2016, the Company amended its articles of incorporation to increase its authorized common shares to 3,000,000,000 shares.

Transfer and Conversion of Preferred Shares

On October 7, 2015, The Company transferred 1,000,000 Preferred Shares from William D. Gross to Maple Structure Holdings, LLC, a related party controlled by Mr. Jack W. Hanks, a director and officer of the Company.

On November 10, 2015, Maple Structure Holdings converted the 1,000,000 Preferred Shares with a book value of $1,000,000 and accrued dividends of $232,837 into 123,283,700 common shares of the Company at $0.01 per share. The issuance of the common shares to Maple Structure Holdings was approved by the Company’s Board of Directors Resolution dated May 18, 2015.

On November 11, 2015, Maple Structure Holdings transferred a total of 70,890,440 shares to the following entities: (i) AAM Investments, LLC- 27,546,375 shares; (ii) The Maple Gas Corporation- 28,091,350 shares; and (iii) Delavega Trading LTD- 15,252,715 shares. All of the foregoing entities are related parties to the Directors of the Company.

Transfer and Conversion of Notes Payable in Default

On October 9, 2014, the convertible notes payable in default of $1,650,000, $120,000 and $180,000 (Note 7) were assigned to The Maple Gas Corporation, a related party. On May 2, 2016, The Maple Gas Corporation converted the notes into 195,000,000 common shares of the Company at $0.01 per share. The issuance of the common shares to Maple Structure Holdings was approved by the Company’s Board of Directors Resolution dated May 18, 2015.

The common shares were issued to the following entities: (i) Maple Structure Holdings-82,875,000 shares; (ii) The Maple Gas Corporation-44,431,151 shares; Enzamora LTD-24,124,688 shares; and BNL Family Trust-43,569,160 shares. All of the foregoing entities are related parties to the Directors of the Company.

 

19

Subsequent Financings

As the Company continues to expand its business and implement its business strategy, its current monthly cash flow requirements will exceed its near term cash flow from operations. In order to fund its development costs, the Company initiated in fiscal year 2016 a private placement to qualified investors for cash and services. Through the date of the filing of this report, $122,142 cash and $60,000 in services had been received, including $52,142 cash from related parties, for a total of 15,153,824 common shares of the Company and a total of 18,039,413 warrants. The warrants entitle the investors to purchase common shares at an exercise price of $0.01 per share for a 5-year period. The private placement is ongoing and only a portion of the common shares of the Company and warrants have been issued. On July 12, 2016, 1,096,397 shares of the Company’s common stock were issued to one of the investors.

Settlement Agreement and Stipulation

On October 28, 2016, MMEX Resources Corporation (the “Company) entered into a Settlement Agreement and Stipulation (the “Settlement Agreement”) with Rockwell Capital Partners, Inc. (“RCP”). Pursuant to the Settlement Agreement, as amended, RCP has purchased certain outstanding payables between the Company and designated vendors totaling $109,391 (the “Payables” or “Claims”) and will exchange the portion of such Payables assigned for a Settlement Amount payable in common shares of the Company.

In settlement of the Claims, the Company shall issue and deliver to RCP, in one or more tranches as necessary, shares of the Company’s common stock (“Common Stock”), subject to adjustment and ownership limitations as set forth in the Settlement Agreement, sufficient to satisfy the Claims amount at a 50% discount to market based on the market price during the valuation period as defined in the Settlement Agreement. The Company also issued 7,000,000 shares of Common Stock as a settlement fee on October 31, 2016.

On October 28, 2016, a circuit court in Florida issued an order confirming the fairness of the terms of the Settlement Agreement within the meaning of exemption from registration provided by Section 3(a) (10) of the Securities Act of 1933.

The Company issued the following shares of its common stock to RCP in settlement of Claims: 10,000,000 shares on November 3, 2016, 15,000,000 shares on November 4, 2016, 18,000,000 shares on November 10, 2016, 18,000,000 shares on November 16, 2016, 14,000,000 shares on November 21, 2016, 22,000,000 shares on November 28, 2016 and 22,000,000 shares on November 30, 2016.

Other Subsequent Events

As of April 13, 2016, the Company assigned AMC to an irrevocable trust (the " MMEX Trust"), whose beneficiaries are the existing shareholders of the Company. AMC through the MMEX Trust controls the Colombia Hunza coal interest previously owned by the Company.

As of June 29, 2016, the Board of Directors executed a Board Resolution that the Directors of the Company may be two directors pursuant to the By-Laws of the Company. As of June 29, 2016, Nabil Katabi resigned as a director of the Company.

 

20

ITEM 2 Management’s Discussion and Analysis of Financial Condition and Results of Operations

The following discussion and analysis constitutes forward-looking statements for purposes of the Securities Act and the Exchange Act and as such involves known and unknown risks, uncertainties and other factors which may cause our actual results, performance or achievements to be materially different from future results, performance or achievements expressed or implied by such forward-looking statements. The words "expect", "estimate", "anticipate", "predict", "believes", "plan", "seek", "objective" and similar expressions are intended to identify forward-looking statements or elsewhere in this report. Important factors that could cause our actual results, performance or achievement to differ materially from our expectations are discussed in detail in Item 1 above. All written or oral forward-looking statements attributable to us are expressly qualified in their entirety by such factors. We undertake no obligation to publicly release the result of any revisions to these forward-looking statements that may be made to reflect events or circumstances after the date hereof or to reflect the occurrence of unanticipated events. Notwithstanding the foregoing, we are not entitled to rely on the safe harbor for forward looking statements under 27A of the Securities Act or 21E of the Exchange Act as long as our stock is classified as a penny stock within the meaning of Rule 3a51-1 of the Exchange Act. A penny stock is generally defined to be any equity security that has a market price (as defined in Rule 3a51-1) of less than $5.00 per share, subject to certain exceptions.

The following discussion should be read in conjunction with the Condensed Consolidated Financial Statements, including the notes thereto.

Overview

As of October 31, 2014, MMEX Resources Corporation (the “Company”) had interests in coal prospects in Colombia, South America. As of May 18, 2015, the Company’s Board of Directors approved the transfer its coal assets in Colombia to a trust for the benefit of its existing shareholders. The shareholders of the Company have the same pro-rata ownership interests in the trust that they had in the Company as of the date of the transfer which is as of April 11, 2016. In addition, the shareholders of the Company have the same ownership interests in in the Company subject to the dilution by the acquisition of Maple Structured Holdings, LLC of the purchase of the preferred shares and selected debt of the Company, and then the subsequent conversion of those Instruments into equity of the Company at $0.01 per share followed by the assignment by Maple Structure Holdings, LLC of shares to related parties. That conversion resulted in a substantial dilution of existing shareholders, including majority shareholder ownership.

The Company’s Board of Directors have made the decision to focus the Company efforts into the oil, gas, refining and electric power business in the U.S. and Latin America. The principal reasons are the following:

· The Company’s principal shareholders and directors are also principals in a privately held U.S. oil and gas company, Maple Resources Corporation based in Austin, Texas.

· The Company’s management team has over 30 years of experience in natural resource project development and project financing in North and South America and in the U.K.

· The Company’s directors and principal shareholders with oil, gas, refining and electric power experience will bring this expertise into the Company.

The new development strategy is to focus on the acquisition, development and financing of oil, gas, refining and electric power projects in Texas, Peru and other countries in Central and Latin America.

 

21

As we continue to expand our business and implement our business strategy, our current monthly cash flow requirements will exceed our near term cash flow from operations. Our available cash resources and anticipated cash flow from operations are insufficient to satisfy our anticipated costs associated with new project development. There can be no assurance that we will be able to generate sufficient cash from operations in future periods to satisfy our capital requirements. Therefore, we will have to continue to rely on external financing activities, including the sale of our equity securities, to satisfy our capital requirements for the foreseeable future. Due, in part, to our lack of historical earnings, our prior success in attracting additional funding has been limited to transactions in which our equity is used as currency. In light of the availability of this type of financing, and the lack of alternative proposals, our board of directors has determined that the continued use of our equity for these purposes may be necessary if we are to sustain operations. Equity financings of the type we have been required to pursue are dilutive to our stockholders and may adversely impact the market price for our shares. However, we have no commitments for borrowings or additional sales of equity, the precise terms upon which we may be able to attract additional funding is not known at this time, and there can be no assurance that we will be successful in consummating any such future financing transactions on terms satisfactory to us, or at all.

Results of Operations

Revenues

We have not yet begun to generate revenues.

Operating Expenses

Our selling, general and administrative expenses decreased $82,869 to $189,941 for the three months ended October 31, 2014 from $272,810 for the three months ended October 31, 2013, and decreased $165,175 to $385,169 for the six months ended October 31, 2014 from $550,344 for the six months ended October 31, 2013. The decrease is due to reduced payroll and professional fees as we have focused on our new development strategy.

Depreciation and Amortization Expense

Our depreciation and administrative expenses are not material to our operations and remained fairly constant. Depreciation and administrative expenses were $1,251 and $1,250 for the three months ended October 31, 2014 and 2013, respectively, and $2,502 for each of the six months ended October 31, 2014 and 2013.

Other (Expense)

Our interest expense decreased $24,214 to $131,002 for the three months ended October 31, 2014 from $155,216 for the three months ended October 31, 2013, and decreased $136,751 to $253,532 for the six months ended October 31, 2014 from $390,283 for the six months ended October 31, 2013. During the current year, we continued to increase our convertible notes payable to related parties; however, the increased interest expense attributable to the new debt was offset by decreased interest expense attributable to prior years' debt resulting from debt discount being fully amortized to interest expense.

Net Loss

As a result of the above, our net loss decreased to $322,194 for the three months ended October 31, 2014 from $429,276 for the three months ended October 31, 2013, and decreased to $641,203 for the six months ended October 31, 2014 from $943,129 for the six months ended October 31, 2013.

 

22

Non-Controlling Interest in Loss of Consolidated Subsidiaries

Non-controlling interest in loss of consolidated subsidiaries decreased to $254 for the three months ended October 31, 2014 from $349 for the three months ended October 31, 2013, and decreased to $507 for the six months ended October 31, 2014 from $672 for the six months ended October 31, 2013.

Net Loss Attributable to the Company

Net loss attributable to the Company decreased to $321,940 for the three months ended October 31, 2014 from $428,927 for the three months ended October 31, 2013, and decreased to $640,696 for the six months ended October 31, 2014 from $942,457 for the six months ended October 31, 2013.

Liquidity and Capital Resources

Introduction

As of October 31, 2014, we had current assets of $10,141 and current liabilities of $6,986,863, resulting in a working capital deficit of $6,976,722. In addition, we had a total stockholders’ deficit of $6,976,722 at October 31, 2014.

During the six months ended October 31, 2014, because of our operating losses, we did not generate positive operating cash flows. As a result, we have significant short-term cash needs. Our principal source of operating capital has been provided from private sales of our common stock, preferred stock, partnership capital contributions, and debt financing.

During the six months ended October 31, 2014, financing of $10,000 was provided by short-term convertible notes payable to a related party.

As we attempt to expand exploration activities and develop our international operations, we expect to continue to experience net negative cash flows from operations in amounts not now determinable, and will be required to obtain additional financing to fund operations through common stock offerings, preferred stock offerings, and debt borrowings to the extent necessary to provide working capital. We have and expect to continue to have substantial capital expenditure and working capital needs. We do not now have funds sufficient to fund our operations at their current level for the next twelve months. We need to raise additional cash to fund our operations and implement our business plan. We expect that the additional financing will (if available) take the form of a private placement of equity, although we may be constrained to obtain additional debt financing in lieu thereof. We are maintaining an on-going effort to locate sources of additional funding, without which we will not be able to remain a viable entity. No financing arrangements are currently under contract, and there are no assurances that we will be able to obtain adequate financing. If we are able to obtain the financing required to remain in business, eventually achieving operating profits will require commencement of operations to generate revenues or drastically reducing expenses from their current levels or both. If we are able to obtain the required financing to remain in business, future operating results depend upon a number of factors that are outside of our control.

Sources and Uses of Cash

We used net cash of $10,293 in operating activities for the six months ended October 31, 2014 as a result of our net loss attributable to the Company of $640,696 and non-controlling interest in net loss of $507, partially offset by non-cash expenses totaling $123,412 and increases in accounts payable of $3,278 and accrued expenses of $504,220.

By comparison, we used net cash of $55,175 in operating activities for the six months ended October 31, 2013 as a result of our net loss attributable to the Company of $942,457 and non-controlling interest in net loss of $672, partially offset by non-cash expenses totaling $273,510 and increases in accounts payable of $15,292 and accrued expenses of $599,152.

 

23

We had no net cash provided by or used in investing activities for the six months ended October 31, 2014 and 2013.

We had net cash provided by financing activities of $10,000 and $54,641 for the six months ended October 31, 2014 and 2013, respectively, comprised of proceeds from convertible notes payable – related party.

Off-Balance Sheet Arrangements

We do not have any off-balance sheet arrangements that have or are reasonably likely to have a current or future effect on our financial condition, changes in financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources that are material to investors.

Future Obligations

Management projects working capital needs to be uncertain and this will depend on future projects to be developed by the Company. The corporate overhead requirements are uncertain also at this time and will depend on the project pipeline flow. With Armadillo Mining Corporation now subject to its own trust arrangement, the Company will not be responsible for any more costs or obligations for Armadillo Mining Corporation or the Colombia coal operations of Hunza. Management believes that current cash and cash equivalents will not be sufficient to meet anticipated capital requirements or corporate overhead requirements under this new business plan. We will be forced to raise additional capital through the issuance of new shares, the exercise of outstanding warrants, or reduce our current overhead. However, any projections of future cash needs and cash flows are subject to substantial uncertainty.

Critical Accounting Policies

For further information on our significant accounting policies see the notes to our condensed consolidated financial statements included in this filing and in Note 2 to our consolidated financial statements included in our Annual Report on Form 10-K for the year ended April 30, 2014 filed with the Securities and Exchange Commission. There have been no changes to our significant accounting policies. The following describes the general application of accounting principles that impact our interim condensed consolidated financial statements.

Our results of operations are based upon our consolidated financial statements, which have been prepared in accordance with accounting principles generally accepted in the United States. The preparation of these financial statements requires us to make estimates and judgments that affect the reported amounts of assets, liabilities, revenues and expenses, and related disclosure of contingent assets and liabilities. On an on-going basis, we evaluate our estimates, including those related to inventories, investments, intangible assets, income taxes, financing operations, and contingencies and litigation. We base our estimates on historical experience and on various other assumptions that are believed to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources. Actual results may differ from these estimates under different assumptions or conditions.

 

24

ITEM 3 Quantitative and Qualitative Disclosures About Market Risk

As a smaller reporting company, we are not required to provide the information required by this Item.

ITEM 4 Controls and Procedures

(a) Evaluation of Disclosure Controls and Procedures

We carried out an evaluation, under the supervision and with the participation of our management, including our principal executive officer and principal financial officer, of the effectiveness of our disclosure controls and procedures (as defined) in Exchange Act Rules 13a – 15(c) and 15d – 15(e). Based upon that evaluation, our principal executive officer and principal financial officer concluded that, as of the end of the period covered in this report, our disclosure controls and procedures were not effective to ensure that information required to be disclosed in reports filed under the Securities Exchange Act of 1934 (“Securities Exchange Act”) is recorded, processed, summarized and reported within the required time periods and is accumulated and communicated to our management, including our principal executive officer and principal financial officer, as appropriate to allow timely decisions regarding required disclosure.

Our management, including our principal executive officer and principal financial officer, does not expect that our disclosure controls and procedures or our internal controls will prevent all error or fraud. A control system, no matter how well conceived and operated, can provide only reasonable, not absolute, assurance that the objectives of the control system are met. Further, the design of a control system must reflect the fact that there are resource constraints and the benefits of controls must be considered relative to their costs. Due to the inherent limitations in all control systems, no evaluation of controls can provide absolute assurance that all control issues and instances of fraud, if any, have been detected. To address the material weaknesses, we performed additional analysis and other post-closing procedures in an effort to ensure our condensed consolidated financial statements included in this quarterly report have been prepared in accordance with generally accepted accounting principles. Accordingly, management believes that the financial statements included in this report fairly present in all material respects our financial condition, results of operations and cash flows for the periods presented.

Our management is responsible for establishing and maintaining adequate internal control over financial reporting as defined in Rule 13a-15(f) under the Securities Exchange Act, as amended. Our management assessed the effectiveness of our internal control over financial reporting as of October 31, 2014. In making this assessment, our management used the criteria set forth by the Committee of Sponsoring Organizations of the Treadway Commission ("COSO") in Internal Control-Integrated Framework. A material weakness is a deficiency, or a combination of deficiencies, in internal control over financial reporting, such that there is a reasonable possibility that a material misstatement of the company's annual or interim financial statements will not be prevented or detected on a timely basis. We have identified the following material weaknesses:

· As of October 31, 2014, we did not maintain effective controls over the control environment. Specifically, the Board of Directors does not currently have any independent members and no director qualifies as an audit committee financial expert as defined in Item 407(d)(5)(ii) of Regulation S-B. Since these entity level programs have a pervasive effect across the organization, management has determined that these circumstances constitute a material weakness.

· As of October 31, 2014, we did not maintain effective controls over financial statement disclosure. Specifically, controls were not designed and in place to ensure that all disclosures required were originally addressed in our financial statements. Accordingly, management has determined that this control deficiency constitutes a material weakness.

Because of these material weaknesses, management has concluded that the Company did not maintain effective internal control over financial reporting as of October 31, 2014, based on the criteria established in "Internal Control-Integrated Framework" issued by the COSO.

(b) Changes in Internal Control over Financial Reporting

There was no change in our internal control over financial reporting identified in connection with the evaluation required by Rule 13a-15(d) and 15d-15(d) of the Exchange Act that occurred during the period covered by this report that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.

 

25

PART II – OTHER INFORMATION

ITEM 1 Legal Proceedings

We are not a party to or otherwise involved in any legal proceedings.

In the ordinary course of business, we are from time to time involved in various pending or threatened legal actions. The litigation process is inherently uncertain and it is possible that the resolution of such matters might have a material adverse effect upon our financial condition and/or results of operations. However, in the opinion of our management, other than as set forth herein, matters currently pending or threatened against us are not expected to have a material adverse effect on our financial position or results of operations.

ITEM 1A Risk Factors

As a smaller reporting company, we are not required to provide the information required by this Item.

ITEM 2 Unregistered Sales of Equity Securities and Use of Proceeds

During the three months ended October 31, 2014, we had no unregistered sales of equity securities:

ITEM 3 Defaults Upon Senior Securities

There is no information required to be disclosed by this Item.

ITEM 4 Mine Safety Disclosures

There is no information required to be disclosed by this Item.

ITEM 5 Other Information

There is no information required to be disclosed by this Item.

 

26

ITEM 6 Exhibits

3.1	Certificate of Amendment to the Articles of Incorporation dated November 29, 2016 (1)
31.1*	Certification by Chief Executive Officer and Chief Financial Officer pursuant to Rule 13a-14(a)/15d-14(a)
32.1*	Certification by Chief Executive Officer and Chief Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
101.INS**	XBRL Instance Document
101.SCH**	XBRL Taxonomy Extension Schema Document
101.CAL**	XBRL Taxonomy Extension Calculation Linkbase Document
101.DEF**	XBRL Taxonomy Extension Definition Linkbase Document
101.LAB**	XBRL Taxonomy Extension Label Linkbase Document
101.PRE**	XBRL Taxonomy Extension Presentation Linkbase Document

_________

*	Filed herewith.
(1)	Incorporated herein by reference to the Company’s Quarterly Report on Form 10-Q filed with the SEC on December 5, 2016.
**	Pursuant to Rule 406T of Regulation S-T, these interactive data files are deemed not filed or part of a registration statement or prospectus for purposes of Sections 11 or 12 of the Securities Act of 1933 or Section 18 of the Securities Act of 1934 and otherwise are not subject to liability.

27

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

	MMEX Resources Corporation
Dated: December 5, 2016	By:	/s/ Jack W. Hanks
		Chief Executive Officer (Principal Executive Officer), President and Chief Financial Officer (Principal Financial and Accounting Officer)

28

EX-31.1

EXHIBIT 31.1

Rule 13a-14(a)/15d-14(a) Certification of Chief Executive Officer and Chief Financial Officer

I, Jack W. Hanks, certify that:

1.	I have reviewed this Quarterly Report on Form 10-Q of MMEX Resources Corporation.;
2.	Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
3.	Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
4.	The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exhibit Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

(a)	Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
(b)	Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
(c)	Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
(d)	Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

(a)	All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
(b)	Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Dated: December 5, 2016	By:	/s/ Jack W. Hanks
		Jack W. Hanks
		Chief Executive Officer and Chief Financial Officer

EX-32.1

EXHIBIT 32.1

CERTIFICATION PURSUANT TO 18 USC, SECTION 1350,

AS ADOPTED PURSUANT TO SECTION 906

OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Quarterly Report of MMEX Resources Corporation (the “Company”) on Form 10-Q for the quarter ended October 31, 2014, as filed with the Securities and Exchange Commission on or about the date hereof (the “Report”), I, Jack W. Hanks, Chief Executive Officer and Chief Financial Officer of the Company, certify, pursuant to 18 U.S.C. Sec. 1350, as adopted pursuant to Sec. 906 of the Sarbanes-Oxley Act of 2002, that:

(1)	The Report fully complies with the requirements of Sections 13(a) or 15(d) of the Securities Exchange Act of 1934; and
(2)	Information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

Dated: December 5, 2016	By:	/s/ Jack W. Hanks
		Jack W. Hanks
		Chief Executive Officer and Chief Financial Officer

A signed original of this written statement required by Section 906 has been provided to MMEX Resources Corporation and will be retained by MMEX Resources Corporation and furnished to the Securities and Exchange Commission or its staff upon request.

XML

Document and Entity Information - shares	6 Months Ended
	Oct. 31, 2014	Dec. 05, 2016
Document And Entity Information
Entity Registrant Name	MMEX Resources Corp
Entity Central Index Key	0001440799
Document Type	10-Q
Document Period End Date	Oct. 31, 2014
Amendment Flag	false
Current Fiscal Year End Date	--04-30
Is Entity a Well-known Seasoned Issuer	No
Is Entity a Voluntary Filer	No
Is Entity's Reporting Status Current	No
Entity Filer Category	Smaller Reporting Company
Entity Common Stock, Shares Outstanding		502,528,410
Document Fiscal Period Focus	Q2
Document Fiscal Year Focus	2015

XML

Condensed Consolidated Balance Sheets - USD ($)	Oct. 31, 2014	Apr. 30, 2014
Current assets:
Cash	$ 141	$ 434
Deferred loan costs - short term	10,000	10,000
Total current assets	10,141	10,434
Property and equipment, net	4,836	7,338
Other assets:
Deferred loan costs - long term	3,822	8,822
Deposits	10,000	10,000
Total Assets	28,799	36,594
Current liabilities:
Accounts payable	660,704	657,426
Accounts payable - related party	8,033	8,033
Accrued expenses	1,544,267	1,396,206
Accrued expenses - related party	1,515,767	1,159,608
Notes payable, currently in default	375,000	375,000
Convertible notes payable, net of discount of $0 and $0 at October 31, 2014 and April 30, 2014, respectively, currently in default	2,145,001	2,145,001
Convertible notes payable related party, net of discount of $72 and $0 at October 31, 2014 and April 30, 2014, respectively, currently in default	129,895	119,967
Convertible preferred stock, currently in default	137,500	137,500
Preferred stock mandatory redemption right, net of discount of $529,304 and $645,172 at October 31, 2014 and April 30, 2014, respectively	470,696	354,828
Total current liabilities	6,986,863	6,353,569
Stockholders' (Deficit):
Common stock, $0.001 par value, 300,000,000 shares authorized, 57,188,313 shares issued and outstanding at April 30, 2015 and April 30, 2014	57,189	57,189
Common stock payable	90,000	90,000
Additional paid in capital	20,215,398	20,215,284
Non-controlling interest	(368,685)	(368,178)
Accumulated deficit	(26,951,966)	(26,311,270)
Total Stockholders' Deficit	(6,958,064)	(6,316,975)
Total Liabilities and Stockholders' Deficit	$ 28,799	$ 36,594

XML

Condensed Consolidated Balance Sheets (Parenthetical) - USD ($)	Oct. 31, 2014	Apr. 30, 2014
Current liabilities:
Convertible notes, net of discount currently in default	$ 0	$ 0
Convertible notes, net of discount related party	72	0
Discount on preferred stock redemption right, net	$ 529,304	$ 645,172
Stockholders' (Deficit):
Common stock, par value	$ 0.001	$ 0.001
Common stock, Authorized	300,000,000	300,000,000
Common stock, Issued	57,188,313	57,188,313
Common stock, outstanding	57,188,313	57,188,313

XML

Condensed Consolidated Statements of Operations (Unaudited) - USD ($)	3 Months Ended		6 Months Ended
	Oct. 31, 2014	Oct. 31, 2013	Oct. 31, 2014	Oct. 31, 2013
Condensed Consolidated Statements Of Operations
Revenues
Operating Expenses:
Selling, general and administrative expenses	189,941	272,810	385,169	550,344
Depreciation and amortization	1,251	1,250	2,502	2,502
Total operating expenses	191,192	274,060	387,671	552,846
Loss from operations	(191,192)	(274,060)	(387,671)	(552,846)
Other (expense):
Interest expense	(131,002)	(155,216)	(253,532)	(390,283)
Total other (expense)	(131,002)	(155,216)	(253,532)	(390,283)
Loss before income taxes	(322,194)	(429,276)	(641,203)	(943,129)
Provision for income taxes
Net Loss	(322,194)	(429,276)	(641,203)	(943,129)
Non-controlling interest in loss of consolidated subsidiaries	254	349	507	672
Net loss attributable to company	$ (321,940)	$ (428,927)	$ (640,696)	$ (942,457)
Weighted average number of common shares outstanding - basic and fully diluted	57,188,313	57,188,313	57,188,313	57,188,313
Net (loss) per share - basic and fully diluted	$ (0.01)	$ (0.01)	$ (0.01)	$ (0.02)

XML

Condensed Consolidated Statements of Cash Flows (Unaudited) - USD ($)	6 Months Ended
	Oct. 31, 2014	Oct. 31, 2013
Cash flows from operating activities
Net loss attributable to the Company	$ (640,696)	$ (942,457)
Non-controlling interest in net loss	(507)	(672)
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation and amortization expense	2,502	2,502
Amortization of debt discount	115,910	266,008
Amortization of issuance costs	5,000	5,000
Increase (decrease) in liabilities:
Accounts payable	3,278	15,292
Accrued expenses	504,220	599,152
Net cash used in operating activities	(10,293)	(55,175)
Cash flows from investing activities
Purchase of property and equipment
Net cash used in investing activities
Cash flows from financing activities
Proceeds from convertible notes payable related party	10,000	54,641
Net cash provided by financing activities	10,000	54,641
Net decrease in cash	(293)	(534)
Cash at the beginning of the period	434	729
Cash at the end of the period	141	195
Supplemental disclosures:
Interest paid
Income taxes paid
Non-cash investing and financing activities:
Convertible debt beneficial conversion feature	$ 114

XML

Background, Organization, And Basis Of Presentation

6 Months Ended

Oct. 31, 2014

Notes to Financial Statements

NOTE 1 - Background, Organization, And Basis Of Presentation

MMEX Resources Corporation (the “Company” or “MMEX”) was formed in the State of Nevada on May 19, 2005 as Inkie Entertainment Group, Inc. On April 6, 2016, the Company amended its articles of incorporation to change its name to MMEX Resources Corporation and to authorize the Company to issue up to 1,000,000,000 common shares and 10,000,000 preferred shares. The changes in the number of authorized shares of the Company have been given retroactive effect in the accompanying condensed consolidated financial statements. The Board of Directors of the Company has made the decision to focus efforts on the oil, gas, refining and electric power business in the United States and Latin America.

The accompanying condensed consolidated financial statements include the accounts of the following entities, all of which the Company maintains control through a majority ownership:

Name of Entity	%	Form of Entity	State of Incorporation	Relationship
MMEX Resources Corporation (“MMEX”)	-	Corporation	Nevada	Parent
MCC Merger, Inc. (“MCCM”)	100%	Corporation	Delaware	Holding Subsidiary
Maple Carpenter Creek Holdings, Inc. (“MCCH”)	100%	Corporation	Delaware	Subsidiary
Maple Carpenter Creek, LLC (“MCC”)	80%	LLC	Nevada	Subsidiary
Carpenter Creek, LLC (“CC”)	95%	LLC	Delaware	Subsidiary
Armadillo Holdings Group Corp. (“AHGC”)	100%	Corporation	British Virgin Isles	Subsidiary
Armadillo Mining Corp. (“AMC”)	98.6%	Corporation	British Virgin Isles	Subsidiary

All significant inter-company transactions have been eliminated in the preparation of the condensed consolidated financial statements.

These financial statements reflect all adjustments, consisting of normal recurring adjustments, which in the opinion of management are necessary for a fair presentation of the information contained therein.

The Company has adopted a fiscal year end of April 30.

XML

Summary Of Significant Accounting Policies

6 Months Ended

Oct. 31, 2014

Notes to Financial Statements

NOTE 2 - Summary Of Significant Accounting Policies

Our significant accounting policies are described in our Annual Report on Form 10-K for the year ended April 30, 2014 filed with the SEC on April 15, 2016.

Use of Estimates

The preparation of financial statements in conformity with accounting principles generally accepted in the United States requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, and the disclosure of contingent assets and liabilities at the date of the financial statements, and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates.

Income or Loss Per Share

Basic income or loss per share is calculated by dividing net income or loss (available to common stockholders) by the weighted average number of common shares outstanding for the period. Diluted income or loss per share reflects the potential dilution that could occur if securities or other contracts to issue common stock, such as stock options, warrants, convertible preferred stock and convertible debentures, were exercised or converted into common stock. For the three months and six months ended October 31, 2014 and 2013, potential dilutive securities had an anti-dilutive effect and were not included in the calculation of diluted net loss per common share.

Therefore, basic loss per share is the same as diluted loss per share and the weighted average number of common shares outstanding was 57,188,313 for each of the three and six-month periods ended October 31, 2014 and 2013.

Issuance of Shares for Non-Cash Consideration

The Company accounts for the issuance of equity instruments to acquire goods and/or services based on the fair value of the goods and services or the fair value of the equity instrument at the time of issuance, whichever is more reliably determinable. The Company's accounting policy for equity instruments issued to consultants and vendors in exchange for goods and services follows the provisions of the standards issued by the Financial Accounting Standards Board (“FASB”). The measurement date for the fair value of the equity instruments issued is determined as the earlier of (i) the date at which a commitment for performance by the consultant or vendor is reached or (ii) the date at which the consultant or vendor's performance is complete. In the case of equity instruments issued to consultants, the fair value of the equity instrument is recognized over the term of the consulting agreement.

Reclassifications

Certain amounts in the condensed consolidated financial statements for the prior year periods have been reclassified to conform with the current year presentation.

Recently Issued Accounting Pronouncements

In October 2016, the FASB issued Accounting Standards Update (“ASU”) No. 2016-17, “Consolidation (Topic 810): Interests Held Through Related Parties That are Under Common Control.” This update amends the consolidation guidance on how a reporting entity that is the single decision maker of a variable interest entity (“VIE”) should treat indirect interests in the entity held through related parties that are under common control with the reporting entity when determining whether it is the primary beneficiary of that VIE. The primary beneficiary of a VIE is the reporting entity that has a controlling financial interest in a VIE and, therefore, consolidates the VIE. A reporting entity has an indirect interest in a VIE if it has a direct interest in a related party that, in turn, has a direct interest in the VIE. The amendments in this ASU are effective for public business entities for fiscal years beginning after December 15, 2016, including interim periods within those fiscal years. Early adoption is permitted, including adoption in an interim period. If an entity early adopts the amendments in an interim period, any adjustments should be reflected as of the beginning of the fiscal year that includes that interim period. The Company is currently unable to determine the impact on its consolidated financial statements of the adoption of this new accounting pronouncement.

In August 2016, the FASB issued ASU No. 2016-15, “Statement of Cash Flows (Topic 230): Classification of Certain Cash Receipts and Cash Payments.” This ASU addresses eight specific cash flow issues with the objective of reducing the existing diversity in practice. The amendments in this ASU are effective for public business entities for fiscal years beginning after December 15, 2017, and interim periods within those fiscal years. Early adoption is permitted. The Company is currently unable to determine the impact on its consolidated financial statements of the adoption of this new accounting pronouncement.

In March 2016, the FASB issued ASU No. 2016-09, "Stock Compensation (Topic 718)", which is intended to simplify several aspects of the accounting for share-based payment award transactions, including the income tax impacts, the classification on the statement of cash flows, and forfeitures. The amendments in this ASU are effective for fiscal years beginning after December 15, 2016, including interim periods. The Company is currently unable to determine the impact on its consolidated financial statements of the adoption of this new accounting pronouncement.

In February 2016, the FASB issued ASU No. 2016-02, "Leases (Topic 842)". The amendments in this ASU revise the accounting related to lessee accounting. Under the new guidance, lessees will be required to recognize a lease liability and a right-of-use asset for all leases. The new lease guidance also simplifies the accounting for sale and leaseback transactions primarily because lessees must recognize lease assets and lease liabilities. The amendments in this ASU are effective for public companies for fiscal years beginning after December 15, 2018 and are to be applied through a modified retrospective transition approach for leases existing at, or entered into after, the beginning of the earliest comparative period presented in the financial statements. Early adoption is permitted. The Company is currently unable to determine the impact on its consolidated financial statements of the adoption of this new accounting pronouncement.

In April 2015, the FASB issued ASU No. 2015-03, "Interest – Imputation of Interest (Subtopic 835-30), Simplifying the Presentation of Debt Issuance Costs." To simplify presentation of debt issuance costs, the amendments in this Update require that debt issuance costs related to a recognized debt liability be presented in the balance sheet as a direct deduction from the carrying amount of that debt liability, consistent with debt discounts. The recognition and measurement guidance for debt issuance costs are not affected by the amendments in this Update. For public companies, the amendments in this Update are effective for financial statements issued for fiscal years beginning after December 15, 2015 and interim periods within those fiscal years. The Company is currently unable to determine the impact on its consolidated financial statements of the adoption of this new accounting pronouncement.

In August 2014, the FASB issued Accounting Standards Update (“ASU”) No. 2014-15, “Presentation of Financial Statements – Going Concern (Subtopic 310-40): Disclosure of Uncertainties about an Entity's Ability to Continue as a Going Concern.” The amendments in this Update provide guidance in GAAP about management's responsibility to evaluate whether there is substantial doubt about an entity's ability to continue as a going concern and to provide related footnote disclosures. In doing so, the amendments are intended to reduce diversity in the timing and content of footnote disclosures. The amendments are effective for the annual period ending after December 15, 2016, and for annual periods and interim periods thereafter. Early application is permitted. The Company has not determined the impact of the future adoption of the provisions of ASU No. 2014-15 on its consolidated financial statements.

Although there are several other new accounting pronouncements issued or proposed by the FASB, which the Company has adopted or will adopt, as applicable, the Company does not believe any of these accounting pronouncements has had or will have a material impact on its consolidated financial position or results of operations.

XML

Going Concern

6 Months Ended

Oct. 31, 2014

Notes to Financial Statements

NOTE 3 - Going Concern

Our financial statements are prepared using accounting principles generally accepted in the United States of America applicable to a going concern, which contemplate the realization of assets and liquidation of liabilities in the normal course of business. We have incurred continuous losses from operations, have an accumulated deficit of $26,951,966 and a total stockholders’ deficit of $6,958,064 at October 31, 2014, and have reported negative cash flows from operations since inception. In addition, we do not currently have the cash resources to meet our operating commitments for the next twelve months, and we expect to have ongoing requirements for capital investment to implement our business plan. Finally, our ability to continue as a going concern must be considered in light of the problems, expenses and complications frequently encountered by entrance into established markets and the competitive environment in which we operate.

Since inception, our operations have primarily been funded through private debt and equity financing, as well as capital contributions by our subsidiaries' partners, and we expect to continue to seek additional funding through private or public equity and debt financing.

Our ability to continue as a going concern is dependent on our ability to generate sufficient cash from operations to meet our cash needs and/or to raise funds to finance ongoing operations and repay debt. However, there can be no assurance that we will be successful in our efforts to raise additional debt or equity capital and/or that our cash generated by our operations will be adequate to meet our needs. These factors, among others, indicate that we may be unable to continue as a going concern for a reasonable period of time.

The financial statements do not include any adjustments that might result from the outcome of any uncertainty as to the Company's ability to continue as a going concern. The financial statements also do not include any adjustments relating to the recoverability and classification of recorded asset amounts, or amounts and classifications of liabilities that might be necessary should the Company be unable to continue as a going concern.

XML

Related Party Transactions

6 Months Ended

Oct. 31, 2014

Notes to Financial Statements

NOTE 4 - Related Party Transactions

During the past few years, Tydus Richards, the former Chairman of our board of directors and shareholder, made certain payments on behalf of the Company. The Company has partially reimbursed Mr. Richards for these advances. As of October 31, 2014 and April 30, 2014, a remaining balance of $31,633 included in accrued expenses – related party remains outstanding.

On September 4, 2010, MCCH entered into an employment agreement with the Company's CEO, Jack W. Hanks, for a two-year term, automatically renewable for one-year terms thereafter, at an annual compensation of $300,000 per year.

On September 4, 2010, MCCH entered into a consulting agreement with Bruce N. Lemons, one of the Company's two directors, for a two-year term, automatically renewable for one-year terms thereafter, at an annual compensation of $170,000 per year.

Accrued expenses (see Note 6) to related parties totaled $1,515,767 and $1,159,608 as of October 31, 2014 and April 30, 2014, respectively.

Convertible notes payable – related party, currently in default, consisted of the following at:

	October 31, 2014			April 30, 2014
Note payable to BNL Family Partners, LLC, a related party, with interest at 15%, convertible at the option of the holder into common shares of the Company at a fixed conversion price of $0.025 per share	$	53,530		$	53,530
Note payable to BNL Family Partners, LLC, a related party, maturing June 30, 2015, with interest at 15%, convertible at the option of the holder into common shares of the Company at a fixed conversion price of $0.025 per share		10,000			-
Note payable to Delavega Trading Ltd., a related party, maturing June 20, 2015, with interest at 15%, convertible at the option of the holder into common shares of the Company at a fixed conversion price of $0.25 per share		27,100			27,100
Note payable to Maple Gas Corporation, a related party, with interest at 15%, convertible at the option of the holder into common shares of the Company at a fixed conversion price of $0.025 per share		39,337			39,337
Total		129,967			119,967
Less discount		(72	)		-
Net	$	129,895		$	119,967

BNL Family Partners Convertible Notes

On September 15, 2012, the Corporation entered into a $4,500 convertible note agreement with BNL Family Partners, LLC, a related party. Mr. Bruce N. Lemons, a director of the Corporation, is a partner of BNL Family Partners. The note carries a 20% interest rate until maturity at September 30, 2013 and is convertible into common shares of the Company at the holder's option at $0.20 per share. The holder may accelerate repayment of the promissory notes upon the Company raising additional capital of $150,000. The computed interest of $900 was added to the balance of the note and recorded as additional debt discount. In addition, the Company issued 4,500 warrants valued at $800 using the Black-Scholes option pricing model. The value of the warrants of $800 was recorded as an increase to debt discount and to additional paid-in capital. The warrants are exercisable at an exercise price of $0.30 per common share until September 15, 2015. The note is currently in default.

On April 30, 2014, the Company converted the note payable described above and additional advances from BNL Family Partners into a single $48,130 convertible note agreement with BNL Family Partners. The holder may accelerate repayment of the promissory note upon the Corporation raising additional capital of $1,000,000. The holder may also convert the note into common shares of the Company at the holder's option at $0.025 per Common Share. As the conversion option is above the value of the stock on the date of conversion, no beneficial conversion feature was recorded with this note.

On June 20, 2014, the Company entered into a $10,000 convertible note agreement with BNL Family Partners. The note carries a 15% interest rate until maturity on June 20, 2015 and is convertible into common shares at the holder's option at $0.025 per common share. The Company issued 10,000 warrants valued at $114 using the Black-Scholes option pricing model. The value of the warrants of $114 was recorded as an increase to debt discount and to additional paid-in capital. The warrants are exercisable at an exercise price of $0.05 per common share until June 30, 2017.

Delavega Trading Ltd. Convertible Notes

On August 1, 2012, the Company entered into a $13,000 convertible note agreement with Delavega Trading Ltd., a related party. Mr. Nabil Katabi, a director of the Company, is a control person of Delavega Trading Ltd. The note carries a 20% interest rate until maturity at September 30, 2013 and is convertible into common shares of the Company at the holder's option at $0.20 per common share. The computed interest of $2,600 was added to the balance of the note and recorded as additional debt discount. In addition, the Company issued 13,000 warrants valued at $1,292 using the Black-Scholes option pricing model. The value of the warrants of $1,292 was recorded as an increase to debt discount and to additional paid-in capital. The warrants are exercisable at an exercise price of $0.30 per common share until August 1, 2015. The note is currently in default.

On December 17, 2012, the Company entered into a $6,500 convertible note agreement with Delavega Trading Ltd. The note carries a 20% interest rate until maturity at December 17, 2013 and is convertible into common shares of the Company at the holder's option at $0.20 per common share. The computed interest of $1,300 was added to the balance of the note and recorded as additional debt discount. In addition, the Company issued 6,500 warrants valued at $549 using the Black-Scholes oprtion pricing model. The value of the warrants of $549 was recorded as an increase to debt discount and to additional paid-in capital. The warrants are exercisable at an exercise price of $0.30 per common share until December 17, 2015. The note is currently in default.

On April 30, 2014, the Company converted the notes payable described above and associated accrued interest to and additional advances from Delavega Trading Ltd. into a single $27,100 convertible note agreement with Delavega Trading Ltd. The holder may accelerate repayment of the promissory note upon the Company raising additional capital of $1,000,000. The holder may also convert the note into common shares of the Company at the holder's option at $0.025 per Common Share. As the conversion option was above the value of the stock on the date of conversion, no beneficial conversion feature was recorded with this note.

Maple Gas Advances

During the year ended April 30, 2014, Maple Gas Corporation, a related party owned by Mr. Jack W. Hanks, a director and officer of the Company, advanced funds or incurred expenses on behalf of the Company. On April 30, 2014, the Company entered into a $39,337 convertible note agreement with Maple Gas Corporation for the total advances to that date. The note carries a 15% interest rate. The holder may accelerate repayment of the promissory note upon the Company raising additional capital of $1,000,000. The holder may also convert the note into common shares of the Company at the holder's option at $0.025 per common share. As the conversion option was above the value of the stock on the date of conversion, no beneficial conversion feature was recorded with this note.

The debt discount resulting from interest and the value of warrants computed at the inception of the convertible notes payable – related party is amortized over the term of the notes as additional interest expense. During the three months ended October 31, 2014 and 2013, debt discount amortized to interest expense totaled $29 and $0, respectively. During the six months ended October 31, 2014 and 2013, debt discount amortized to interest expense totaled $42 and $0, respectively. As of October 31, 2014, the debt discount had a balance of $72.

The above convertible notes payable – related party were subsequently forgiven, with the obligations contributed to capital – see Note 12.

XML

Property and Equipment

6 Months Ended

Oct. 31, 2014

Notes to Financial Statements

NOTE 5 - Property and Equipment

Property and equipment consisted of the following at:

	October 31, 2014			April 30, 2014
Computer software and hardware	$	25,023		$	25,023
Less accumulated depreciation and amortization		(20,187	)		(17,685	)
	$	4,836		$	7,338

Depreciation and amortization expense totaled $1,251 and $1,250 for the three months ended October 31, 2014 and 2013, respectively, and $2,502 for each of the six months ended October 31, 2014 and 2013.

XML

Accrued Expenses

6 Months Ended

Oct. 31, 2014

Notes to Financial Statements

NOTE 6 - Accrued Expenses

Accrued expenses consisted of the following at:

	October 31, 2014		April 30, 2014
Accrued payroll	$	973,798	$	725,817
Accrued consulting		1,260,054		1,083,616
Accrued dividend		360,685		310,685
Accrued interest		402,956		373,154
Other		62,541		62,541
	$	3,060,034	$	2,555,813

XML

Notes Payable

6 Months Ended

Oct. 31, 2014

Notes to Financial Statements

NOTE 7 - Notes Payable

Notes payable, currently in default, consist of the following at:

	October 31, 2014		April 30, 2014
Note payable to an unrelated party, maturing July 15, 2010, with interest at 10%	$	300,000	$	300,000
Note payable to an unrelated party, maturing December 31, 2010, with interest at 10%		25,000		25,000
Note payable to an unrelated party, maturing January 27, 2012, with interest at 25%		50,000		50,000
	$	375,000	$	375,000

Accrued interest payable on notes payable, currently in default, totaled $214,602 and $193,977 at October 31, 2014 and April 30, 2014, respectively.

Convertible notes payable, currently in default, consist of the following at:

	October 31, 2014		April 30, 2014
Note payable to an accredited investor, maturing July 31, 2013, with interest at 10%, convertible at the option of the holder into common shares of the Company at a fixed conversion price of $0.20 per share, secured with 2,995,000 common shares of the Company	$	1,650,000	$	1,650,000
Note payable to an accredited investor, maturing October 31, 2013, with interest at 20%, convertible at the option of the holder into common shares of the Company at a fixed conversion price of $0.20 per share		120,000		120,000
Note payable to an accredited investor, maturing February 1, 2014, with interest at 20%, convertible upon default at the option of the holder into common shares of the Company at a fixed conversion price of $0.20 per share		180,000		180,000
Note payable to an accredited investor, maturing March 1, 2013, with interest at 1.87% per month, secured with 900,000 common shares of the Company owned by the president and CEO of the Company		120,000		120,000
Note payable to an unrelated party, maturing March 18, 2014, with interest at 10%		75,001		75,001
Total		2,145,001		2,145,001
Less discount		-		-
Net	$	2,145,001	$	2,145,001

On April 25, 2012, four prior convertible notes payable to an accredited investor were combined into a new $1,500,000 note. The note was due and payable on July 31, 2013. The note bears interest at 10% due at maturity. The computed interest of $150,000 was added to the balance of the note and recorded as additional debt discount. The note is convertible at the option of the holder into shares of the Company’s common stock at a fixed conversion price of $0.20 per share. The note was subsequently transferred to a related party and converted to common shares of the Company – see Note 12.

On August 15, 2012, the Company entered into a $100,000 convertible note agreement with an accredited investor. The note is subject to a 20% placement fee payable to the holder irrespective of the date redeemed, matures on October 31, 2013 and is convertible at the option of the holder into shares of the Company’s common stock at a fixed conversion price of $0.20 per share. The note is currently in default. The computed interest of $20,000 was added to the balance of the note and recorded as additional debt discount. In addition, the Company issued 120,000 warrants valued at $14,232 using the Black-Scholes option pricing model. The value of the warrants of $14,232 was recorded as an increase to debt discount and to additional paid-in capital. The warrants are exercisable at an exercise price of $0.30 per common share until August 15, 2015. The note was subsequently transferred to a related party and converted to common shares of the Company – see Note 12.

On February 1, 2013, the Company entered into a $150,000 convertible note agreement with an unrelated party. The note was due and payable on February 1, 2014, is currently in default and carries an interest rate of 20%. The note is convertible upon default at the option of the holder into shares of the Company’s common stock at a fixed conversion price of $0.20 per share. The computed interest of $30,000 was added to the balance of the note and recorded as additional debt discount. In addition, the Company issued 150,000 warrants valued at $16,103 using the Black-Scholes option pricing model. The value of the warrants of $16,103 was recorded as an increase to debt discount and to additional paid-in capital. The warrants are exercisable at an exercise price of $0.20 per common share on or before three years from the repayment or conversion date. The note was subsequently transferred to a related party and converted to common shares of the Company – see Note 12.

On January 2, 2013, the Company closed a note purchase agreement with an accredited investor pursuant to which the Company sold a $120,000 note in a private placement transaction. The note was due and payable on March 1, 2013, is currently in default and carries a monthly interest rate of 1.87%. The note purchase agreement included the issuance of 300,000 shares of the Company’s common stock. The note is secured with 900,000 shares of the Company’s common stock owned by Jack Hanks, the Company’s President and CEO. The 300,000 shares were valued at $0.10 per share, the closing price of the Company’s common stock on January 2, 2013, and recorded as a $30,000 increase to debt discount and an increase to common stock payable.

The Company allocated the proceeds from the issuance of the notes to the warrants when applicable and to the notes based on their estimated fair market values at the date of issuance using the Black-Scholes option pricing model. The debt discount resulting from interest and the value of warrants computed at the inception of the notes payable is amortized over the term of the notes as additional interest expense and was fully amortized as of April 30, 2014.

XML

Convertible Preferred Stock

6 Months Ended

Oct. 31, 2014

Notes to Financial Statements

NOTE 8 - Convertible Preferred Stock

Preferred Stock – Mandatory Redemption Right

On March 22, 2011, the Company issued 1,000,000 shares of Series A Preferred Stock (the “Preferred Stock”) to an unrelated party in exchange for an investment of $1,000,000. The shares may be converted into the Company’s common shares at $0.40 per common share. The Preferred Stock carry a 10% cumulative dividend and have a mandatory redemption feature on the earlier of March 1, 2016 or on a change of control transaction. The Company is required to redeem the shares at a liquidation value of $1.00 per share plus any accrued and unpaid dividends. Due to the mandatory redemption feature, the Company recorded the investment as a liability under ASC Subtopic 480-10.

The Company recorded the intrinsic value of the beneficial conversion of $1,000,000 as debt discount and will amortize the discount through the mandatory redemption feature date of March 1, 2016. During the three months ended October 31, 2014 and 2013, amortization of debt discount to interest expense totaled $62,020 and $35,245, respectively. During the six months ended October 31, 2014 and 2013, amortization of debt discount to interest expense totaled $115,868 and $65,845, respectively. The investment is collateralized with a security interest in 2,500,000 shares of the Company’s common stock.

Loan costs of $50,000 incurred on the issuance of the Preferred Stock were recorded as deferred loan costs and will be amortized by the effective interest method. The Company recorded amortization on loan costs in the amount of $2,500 for each of the three months ended October 31, 2014 and 2013 and $5,000 for each of the six months ended October 31, 2014 and 2013, respectively. Unpaid dividends payable on the Preferred Stock totaled $360,685 and $310,685 at October 31, 2014 and April 30, 2014, respectively.

On August 15, 2012, the Company amended the Preferred Stock agreement and lowered the conversion rate provided from $0.40 per common share to $0.20 per common share. The amendment generated a $302,694 fair value adjustment that was recorded as additional interest and increased additional paid in capital.

The Preferred Stock and related accrued dividends were subsequently transferred to a related party and converted into common shares of the Company – see Note 12.

Convertible Preferred Stock, Currently in Default

On June 30, 2011, the Company issued 360,000 shares of Armadillo Mining Corporation Preferred Stock to five unrelated parties in exchange for an investment of $360,000. The Preferred Stock carry a 25% cumulative dividend and have a mandatory redemption feature on December 31, 2011 at a price of $1.25 per share. In addition, the Company issued 360,000 warrants to purchase shares of the Company’s common stock at an exercise price of $0.60 per share on or before three years from the repayment or conversion date.

On January 6, 2012, three unrelated parties converted their Preferred Stock and accrued dividends of $312,500 into 2,983,293 shares of the Company’s common stock at a price of $.10475 per share. As the conversion took place at below the market price and not within the terms of the agreement on the date of conversion, a loss of $75,328 was recorded. As of October 31, 2014 and April 30, 2014, the remaining face value of the Preferred Stock was $137,500. Accrued dividends on the Preferred Stock totaled $178,665 and $144,289 as of October 31, 2014 and April 30, 2014, respectively.

The Company recorded interest expense, which includes amortization of debt discount on certain debt described above, totaling $131,002 and $155,216 for the three months ended October 31, 2014 and 2013, respectively, and totaled $253,532 and $390,283 for the six months ended October 31, 2014, respectively.

XML

Stockholders' Deficit

6 Months Ended

Oct. 31, 2014

Notes to Financial Statements

NOTE 9 - Stockholders' Deficit

Authorized Shares

Pursuant to amendments to its articles of incorporation (Note 12), the Company increased its authorized shares to 1,000,000,000 common shares and 10,000,000 preferred shares and subsequently increased its authorized common shares to 3,000,000,000 shares. The increase in authorized shares has been given retroactive effect in the accompanying condensed consolidated financial statements for all periods presented.

Stock Issuances

During the six months ended October 31, 2014, the Company did not issue any shares of its common or preferred stock.

Stock Options

On March 7, 2012, three directors of the Company (the "Optionees") received a total of 2,000,000 unvested stock options exercisable at $0.35 per share for common stock of the Company: after service of one year, 50% will be vested, and after service of the second year the remaining 50% will become vested; with an actual term of ten years from the date of grant. The Company did not grant any stock options during the six months ended October 31, 2014.

The Company uses the Black-Scholes option pricing model to estimate the grant date fair value of its stock options, which value is amortized to stock-based compensation expense over the vesting period of the options. No stock-based compensation expense was recorded during the three months and six months ended October 31, 2014 and 2013 related to stock option grants. There was no unrecognized stock option expense at October 31, 2014.

A summary of stock option activity during the six months ended October 31, 2014 is presented below:

	Shares		Weighted Average Exercise Price		Weighted Average Remaining Contractual Life (Years)
Outstanding, April 30, 2014		2,000,000	$	0.35	8.83
Granted		-		-
Canceled / Expired		-		-
Exercised		-		-
Outstanding, October 31, 2014		2,000,000	$	0.35	8.33

Warrants

The Company has issued warrants to non-employees for either debt discounts or stock-based compensation. These warrants generally vested upon grant and were valued using the Black-Scholes option pricing model. During the quarter ended July 31, 2014, the Company issued warrants to purchase 10,000 shares of common stock to a related party lender.

A summary of warrant activity during the six months ended October 31, 2014 is presented below:

	Shares		Weighted Average Exercise Price		Weighted Average Remaining Contractual Life (Years)
Outstanding, April 30, 2014		32,865,345	$	0.33	1.42
Granted		10,000	$	0.05
Canceled / Expired		-		-
Exercised		-		-
Outstanding, October 31, 2014		32,875,345	$	0.33	0.92

Common Stock Reserved

At October 31, 2014, 49,350,984 shares of the Company’s common stock were reserved: 16,485,639 for debt conversion purposes and 32,875,345 for issuance of outstanding warrants.

XML

Non-controlling Interests

6 Months Ended

Oct. 31, 2014

Notes to Financial Statements

NOTE 10 - Non-controlling Interests

On September 23, 2010, the Company, through a reverse merger, acquired 100% of the outstanding shares of Maple Carpenter Creek Holdings, Inc., ("MCCH"), a holding Company, with an 80% interest in Maple Carpenter Creek, LLC ("MCC"), which in turn owned a 95% interest in the subsidiary, Carpenter Creek, LLC ("CC"), and a 98.12% interest in Armadillo Holdings Group Corp. ("AHGC"), which in turn owned an 80% interest in Armadillo Mining Corp. ("AMC"). The non-controlling interest of 1.88% in AHGC was acquired by MCCH on December 21, 2010 in exchange for 31,334 shares of the Company’s common stock resulting in 100% ownership of AHGC. On March 22, 2011, AHGC acquired 14.6% of AMC and on April 30, 2012, an additional 4% interest for a total of 98.6% based upon agreement with the minority interest holder to reduce their interest based upon proportionate share of additional capital contributed to AMC.

XML

Commitments and Contingencies

6 Months Ended

Oct. 31, 2014

Notes to Financial Statements

NOTE 11 - Commitments and Contingencies

Legal

There were no legal proceedings against the Company.

Operating Lease Commitments

The Company acquired the Bolzer Lease pursuant to a September 23, 2010 merger. Subsequently, notice of termination on this lease effective April 26, 2010 was provided by previous management. The Company has recorded an accrued expense for the minimum lease payment of $62,541 for the January 2010 payment.

XML

Subsequent Events

6 Months Ended

Oct. 31, 2014

Notes to Financial Statements

NOTE 12 - Subsequent Events

In accordance with ASC 855-10, all subsequent events have been reported through the filing date as set forth below.

Convertible Notes Payable – Related Parties

In May 2015, BNL Family Partners, Delavega Trading Ltd. and Maple Gas Corporation, related parties (see Note 4) agreed to forgive certain indebtedness. The reduction of the notes payable and related accrued interest payable was recorded as a contribution to capital.

Transfer of Coal Assets

As of April 30, 2014, the Company had interests in coal prospects in Colombia, South America. As of May 18, 2015, the Board of Directors of the Company approved a transfer its coal assets in Colombia to a trust for the benefit of its existing shareholders with an effective date as of April 13, 2016. The shareholders of the Company have the same allocated share ownership interests in the trust that they had in the Company as of the effective date of the transfer, which is as of April 13, 2016. In addition, the shareholders of the Company have the same ownership interests in the Company subject to the dilution by the acquisition of Maple Structure Holdings, LLC of the purchase of the Preferred Shares and selected debt of the Company, and then the subsequent conversion of those Instruments into equity in the Company at US$0.01 per share. That conversion results in a substantial dilution of existing shareholders including majority shareholder ownership. See below for details of the dilution.

Amendment of Articles of Incorporation

As of April 6, 2016, the Company amended its articles of incorporation to change its corporate name from MMEX Mining Corporation to MMEX Resources Corporation and to increase its authorized shares to 1,000,000,000 common shares and 10,000,000 preferred shares.

As of November 29, 2016, the Company amended its articles of incorporation to increase its authorized common shares to 3,000,000,000 shares.

Transfer and Conversion of Preferred Shares

On October 7, 2015, The Company transferred 1,000,000 Preferred Shares from William D. Gross to Maple Structure Holdings, LLC, a related party controlled by Mr. Jack W. Hanks, a director and officer of the Company.

On November 10, 2015, Maple Structure Holdings converted the 1,000,000 Preferred Shares with a book value of $1,000,000 and accrued dividends of $232,837 into 123,283,700 common shares of the Company at $0.01 per share. The issuance of the common shares to Maple Structure Holdings was approved by the Company’s Board of Directors Resolution dated May 18, 2015.

On November 11, 2015, Maple Structure Holdings transferred a total of 70,890,440 shares to the following entities: (i) AAM Investments, LLC- 27,546,375 shares; (ii) The Maple Gas Corporation- 28,091,350 shares; and (iii) Delavega Trading LTD- 15,252,715 shares. All of the foregoing entities are related parties to the Directors of the Company.

Transfer and Conversion of Notes Payable in Default

On October 9, 2014, the convertible notes payable in default of $1,650,000, $120,000 and $180,000 (Note 7) were assigned to The Maple Gas Corporation, a related party. On May 2, 2016, The Maple Gas Corporation converted the notes into 195,000,000 common shares of the Company at $0.01 per share. The issuance of the common shares to Maple Structure Holdings was approved by the Company’s Board of Directors Resolution dated May 18, 2015.

The common shares were issued to the following entities: (i) Maple Structure Holdings-82,875,000 shares; (ii) The Maple Gas Corporation-44,431,151 shares; Enzamora LTD-24,124,688 shares; and BNL Family Trust-43,569,160 shares. All of the foregoing entities are related parties to the Directors of the Company.

Subsequent Financings

As the Company continues to expand its business and implement its business strategy, its current monthly cash flow requirements will exceed its near term cash flow from operations. In order to fund its development costs, the Company initiated in fiscal year 2016 a private placement to qualified investors for cash and services. Through the date of the filing of this report, $122,142 cash and $60,000 in services had been received, including $52,142 cash from related parties, for a total of 15,153,824 common shares of the Company and a total of 18,039,413 warrants. The warrants entitle the investors to purchase common shares at an exercise price of $0.01 per share for a 5-year period. The private placement is ongoing and only a portion of the common shares of the Company and warrants have been issued. On July 12, 2016, 1,096,397 shares of the Company’s common stock were issued to one of the investors.

Settlement Agreement and Stipulation

On October 28, 2016, MMEX Resources Corporation (the “Company) entered into a Settlement Agreement and Stipulation (the “Settlement Agreement”) with Rockwell Capital Partners, Inc. (“RCP”). Pursuant to the Settlement Agreement, as amended, RCP has purchased certain outstanding payables between the Company and designated vendors totaling $109,391 (the “Payables” or “Claims”) and will exchange the portion of such Payables assigned for a Settlement Amount payable in common shares of the Company.

In settlement of the Claims, the Company shall issue and deliver to RCP, in one or more tranches as necessary, shares of the Company’s common stock (“Common Stock”), subject to adjustment and ownership limitations as set forth in the Settlement Agreement, sufficient to satisfy the Claims amount at a 50% discount to market based on the market price during the valuation period as defined in the Settlement Agreement. The Company also issued 7,000,000 shares of Common Stock as a settlement fee on October 31, 2016.

On October 28, 2016, a circuit court in Florida issued an order confirming the fairness of the terms of the Settlement Agreement within the meaning of exemption from registration provided by Section 3(a) (10) of the Securities Act of 1933.

The Company issued the following shares of its common stock to RCP in settlement of Claims: 10,000,000 shares on November 3, 2016, 15,000,000 shares on November 4, 2016, 18,000,000 shares on November 10, 2016, 18,000,000 shares on November 16, 2016, 14,000,000 shares on November 21, 2016, 22,000,000 shares on November 28, 2016 and 22,000,000 shares on November 30, 2016.

Other Subsequent Events

As of April 13, 2016 the Company assigned AMC to an irrevocable trust (the " MMEX Trust"), whose beneficiaries are the existing shareholders of the Company. AMC through the MMEX Trust controls the Colombia Hunza coal interest previously owned by the Company.

As of June 29, 2016, the Board of Directors executed a Board Resolution that the Directors of the Company may be two directors pursuant to the By-Laws of the Company. As of June 29, 2016, Nabil Katabi resigned as a director of the Company.

XML

Summary Of Significant Accounting Policies (Policies)

6 Months Ended

Oct. 31, 2014

Summary Of Significant Accounting Policies Policies

Use of estimates

The preparation of financial statements in conformity with accounting principles generally accepted in the United States requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, and the disclosure of contingent assets and liabilities at the date of the financial statements, and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates.

Income or Loss Per Share

Basic income or loss per share is calculated by dividing net income or loss (available to common stockholders) by the weighted average number of common shares outstanding for the period. Diluted income or loss per share reflects the potential dilution that could occur if securities or other contracts to issue common stock, such as stock options, warrants, convertible preferred stock and convertible debentures, were exercised or converted into common stock. For the three months and six months ended October 31, 2014 and 2013, potential dilutive securities had an anti-dilutive effect and were not included in the calculation of diluted net loss per common share.

Therefore, basic loss per share is the same as diluted loss per share and the weighted average number of common shares outstanding was 57,188,313 for each of the three and six-month periods ended October 31, 2014 and 2013.

Issuance of Shares for Non-Cash Consideration

The Company accounts for the issuance of equity instruments to acquire goods and/or services based on the fair value of the goods and services or the fair value of the equity instrument at the time of issuance, whichever is more reliably determinable. The Company's accounting policy for equity instruments issued to consultants and vendors in exchange for goods and services follows the provisions of the standards issued by the Financial Accounting Standards Board (“FASB”). The measurement date for the fair value of the equity instruments issued is determined as the earlier of (i) the date at which a commitment for performance by the consultant or vendor is reached or (ii) the date at which the consultant or vendor's performance is complete. In the case of equity instruments issued to consultants, the fair value of the equity instrument is recognized over the term of the consulting agreement.

Reclassifications

Certain amounts in the condensed consolidated financial statements for the prior year periods have been reclassified to conform with the current year presentation.

Recently issued accounting pronouncements

In October 2016, the FASB issued Accounting Standards Update (“ASU”) No. 2016-17, “Consolidation (Topic 810): Interests Held Through Related Parties That are Under Common Control.” This update amends the consolidation guidance on how a reporting entity that is the single decision maker of a variable interest entity (“VIE”) should treat indirect interests in the entity held through related parties that are under common control with the reporting entity when determining whether it is the primary beneficiary of that VIE. The primary beneficiary of a VIE is the reporting entity that has a controlling financial interest in a VIE and, therefore, consolidates the VIE. A reporting entity has an indirect interest in a VIE if it has a direct interest in a related party that, in turn, has a direct interest in the VIE. The amendments in this ASU are effective for public business entities for fiscal years beginning after December 15, 2016, including interim periods within those fiscal years. Early adoption is permitted, including adoption in an interim period. If an entity early adopts the amendments in an interim period, any adjustments should be reflected as of the beginning of the fiscal year that includes that interim period. The Company is currently unable to determine the impact on its consolidated financial statements of the adoption of this new accounting pronouncement.

In August 2016, the FASB issued ASU No. 2016-15, “Statement of Cash Flows (Topic 230): Classification of Certain Cash Receipts and Cash Payments.” This ASU addresses eight specific cash flow issues with the objective of reducing the existing diversity in practice. The amendments in this ASU are effective for public business entities for fiscal years beginning after December 15, 2017, and interim periods within those fiscal years. Early adoption is permitted. The Company is currently unable to determine the impact on its consolidated financial statements of the adoption of this new accounting pronouncement.

In March 2016, the FASB issued ASU No. 2016-09, "Stock Compensation (Topic 718)", which is intended to simplify several aspects of the accounting for share-based payment award transactions, including the income tax impacts, the classification on the statement of cash flows, and forfeitures. The amendments in this ASU are effective for fiscal years beginning after December 15, 2016, including interim periods. The Company is currently unable to determine the impact on its consolidated financial statements of the adoption of this new accounting pronouncement.

In February 2016, the FASB issued ASU No. 2016-02, "Leases (Topic 842)". The amendments in this ASU revise the accounting related to lessee accounting. Under the new guidance, lessees will be required to recognize a lease liability and a right-of-use asset for all leases. The new lease guidance also simplifies the accounting for sale and leaseback transactions primarily because lessees must recognize lease assets and lease liabilities. The amendments in this ASU are effective for public companies for fiscal years beginning after December 15, 2018 and are to be applied through a modified retrospective transition approach for leases existing at, or entered into after, the beginning of the earliest comparative period presented in the financial statements. Early adoption is permitted. The Company is currently unable to determine the impact on its consolidated financial statements of the adoption of this new accounting pronouncement.

In April 2015, the FASB issued ASU No. 2015-03, "Interest – Imputation of Interest (Subtopic 835-30), Simplifying the Presentation of Debt Issuance Costs." To simplify presentation of debt issuance costs, the amendments in this Update require that debt issuance costs related to a recognized debt liability be presented in the balance sheet as a direct deduction from the carrying amount of that debt liability, consistent with debt discounts. The recognition and measurement guidance for debt issuance costs are not affected by the amendments in this Update. For public companies, the amendments in this Update are effective for financial statements issued for fiscal years beginning after December 15, 2015 and interim periods within those fiscal years. The Company is currently unable to determine the impact on its consolidated financial statements of the adoption of this new accounting pronouncement.

In August 2014, the FASB issued Accounting Standards Update (“ASU”) No. 2014-15, “Presentation of Financial Statements – Going Concern (Subtopic 310-40): Disclosure of Uncertainties about an Entity's Ability to Continue as a Going Concern.” The amendments in this Update provide guidance in GAAP about management's responsibility to evaluate whether there is substantial doubt about an entity's ability to continue as a going concern and to provide related footnote disclosures. In doing so, the amendments are intended to reduce diversity in the timing and content of footnote disclosures. The amendments are effective for the annual period ending after December 15, 2016, and for annual periods and interim periods thereafter. Early application is permitted. The Company has not determined the impact of the future adoption of the provisions of ASU No. 2014-15 on its consolidated financial statements.

Although there are several other new accounting pronouncements issued or proposed by the FASB, which the Company has adopted or will adopt, as applicable, the Company does not believe any of these accounting pronouncements has had or will have a material impact on its consolidated financial position or results of operations.

XML

Background, Organization, And Basis Of Presentation (Tables)

6 Months Ended

Oct. 31, 2014

Background Organization And Basis Of Presentation Tables

Entity operational details

				Form of	State of
Name of Entity	%			Entity	Incorporation	Relationship
MMEX Resources Corporation ("MMEX")		-		Corporation	Nevada	Parent
MCC Merger, Inc. ("MCCM")		100	%	Corporation	Delaware	Holding Sub
Maple Carpenter Creek Holdings, Inc. ("MCCH")		100	%	Corporation	Delaware	Subsidiary
Maple Carpenter Creek, LLC ("MCC")		80	%	LLC	Nevada	Subsidiary
Carpenter Creek, LLC ("CC")		95	%	LLC	Delaware	Subsidiary
Armadillo Holdings Group Corp. ("AHGC")		100	%	Corporation	British Virgin Isl.	Subsidiary
Armadillo Mining Corp. ("AMC")		98.6	%	Corporation	British Virgin Isl.	Subsidiary

XML

Related Party Transactions (Tables)

6 Months Ended

Oct. 31, 2014

Summary Of Significant Accounting Policies Tables

Convertible notes payable related party

	October 31, 2014			April 30, 2014
Note payable to BNL Family Partners, LLC, a related party, with interest at 15%, convertible at the option of the holder into common shares of the Company at a fixed conversion price of $0.025 per share	$	53,530		$	53,530
Note payable to BNL Family Partners, LLC, a related party, maturing June 30, 2015, with interest at 15%, convertible at the option of the holder into common shares of the Company at a fixed conversion price of $0.025 per share		10,000			-
Note payable to Delavega Trading Ltd., a related party, maturing June 20, 2015, with interest at 15%, convertible at the option of the holder into common shares of the Company at a fixed conversion price of $0.25 per share		27,100			27,100
Note payable to Maple Gas Corporation, a related party, with interest at 15%, convertible at the option of the holder into common shares of the Company at a fixed conversion price of $0.025 per share		39,337			39,337
Total		129,967			119,967
Less discount		(72	)		-
Net	$	129,895		$	119,967

XML

Property and Equipment (Tables)

6 Months Ended

Oct. 31, 2014

Property And Equipment Tables

Property and Equipment

	October 31, 2014			April 30, 2014
Computer software and hardware	$	25,023		$	25,023
Less accumulated depreciation and amortization		(20,187	)		(17,685	)
	$	4,836		$	7,338

XML

Accrued Expenses (Tables)

6 Months Ended

Oct. 31, 2014

Accrued Expenses Tables

Accrued expenses

	October 31, 2014		April 30, 2014
Accrued payroll	$	973,798	$	725,817
Accrued consulting		1,260,054		1,083,616
Accrued dividend		360,685		310,685
Accrued interest		402,956		373,154
Other		62,541		62,541
	$	3,060,034	$	2,555,813

XML

Notes Payable (Tables)

6 Months Ended

Oct. 31, 2014

Income Taxes Tables

Notes payable, currently in default

	October 31, 2014		April 30, 2014
Note payable to an unrelated party, maturing July 15, 2010, with interest at 10%	$	300,000	$	300,000
Note payable to an unrelated party, maturing December 31, 2010, with interest at 10%		25,000		25,000
Note payable to an unrelated party, maturing January 27, 2012, with interest at 25%		50,000		50,000
	$	375,000	$	375,000

Convertible notes payable, currently in default

	October 31, 2014		April 30, 2014
Note payable to an accredited investor, maturing July 31, 2013, with interest at 10%, convertible at the option of the holder into common shares of the Company at a fixed conversion price of $0.20 per share, secured with 2,995,000 common shares of the Company	$	1,650,000	$	1,650,000
Note payable to an accredited investor, maturing October 31, 2013, with interest at 20%, convertible at the option of the holder into common shares of the Company at a fixed conversion price of $0.20 per share		120,000		120,000
Note payable to an accredited investor, maturing February 1, 2014, with interest at 20%, convertible upon default at the option of the holder into common shares of the Company at a fixed conversion price of $0.20 per share		180,000		180,000
Note payable to an accredited investor, maturing March 1, 2013, with interest at 1.87% per month, secured with 900,000 common shares of the Company owned by the president and CEO of the Company		120,000		120,000
Note payable to an unrelated party, maturing March 18, 2014, with interest at 10%		75,001		75,001
Total		2,145,001		2,145,001
Less discount		-		-
Net	$	2,145,001	$	2,145,001

XML

Stockholders' Deficit (Tables)

6 Months Ended

Oct. 31, 2014

Changes In Stockholders Equity Deficit Tables

Summary of stock option activity

	Shares		Weighted Average Exercise Price		Weighted Average Remaining Contractual Life (Years)
Outstanding, April 30, 2014		2,000,000	$	0.35	8.83
Granted		-		-
Canceled / Expired		-		-
Exercised		-		-
Outstanding, October 31, 2014		2,000,000	$	0.35	8.33

Summary of warrant activity

	Shares		Weighted Average Exercise Price		Weighted Average Remaining Contractual Life (Years)
Outstanding, April 30, 2014		32,865,345	$	0.33	1.42
Granted		10,000	$	0.05
Canceled / Expired		-		-
Exercised		-		-
Outstanding, October 31, 2014		32,875,345	$	0.33	0.92

XML

Background, Organization, and Basis of Presentation (Details)	6 Months Ended
	Oct. 31, 2014
Mmex Resources Corporation [Member]
Ownership Percentage	-
Form of Entity	Corporation
State of Incorporation	Nevada
Relationship	Parent
Mcc Merger Inc [Member]
Ownership Percentage	100%
Form of Entity	Corporation
State of Incorporation	Delaware
Relationship	Holding Sub
Maple Carpenter Creek Holdings Inc [Member]
Ownership Percentage	100%
Form of Entity	Corporation
State of Incorporation	Delaware
Relationship	Subsidiary
Maple Carpenter Creek Llc [Member]
Ownership Percentage	80%
Form of Entity	LLC
State of Incorporation	Nevada
Relationship	Subsidiary
Carpenter Creek Llc [Member]
Ownership Percentage	95%
Form of Entity	LLC
State of Incorporation	Delaware
Relationship	Subsidiary
Armadillo Holdings Group Corp [Member]
Ownership Percentage	100%
Form of Entity	Corporation
State of Incorporation	British Virgin Isl.
Relationship	Subsidiary
Armadillo Mining Corp [Member]
Ownership Percentage	98.60%
Form of Entity	Corporation
State of Incorporation	British Virgin Isl.
Relationship	Subsidiary

XML

Significant Accounting Policies (Details Narrative) - shares	3 Months Ended		6 Months Ended
	Oct. 31, 2014	Oct. 31, 2013	Oct. 31, 2014	Oct. 31, 2013
Significant Accounting Policies Details Narrative
Weighted average number of common shares outstanding - basic and fully diluted	57,188,313	57,188,313	57,188,313	57,188,313

XML

Going Concern (Details Narrative) - USD ($)	Oct. 31, 2014	Apr. 30, 2014
Going Concern Details Narrative
Accumulated deficit	$ (26,951,966)	$ (26,311,270)
Total Stockholders' Deficit	$ (6,958,064)	$ (6,316,975)

XML

Related Party Transactions (Details) - USD ($)	Oct. 31, 2014	Apr. 30, 2014
Total	$ 129,967	$ 119,967
Less discount	(72)	0
Net		119,967
Note payable to BNL Family Partners, LLC [Member]
Total	53,530	53,530
Note payable to BNL Family Partners, LLC One [Member]
Total	10,000
Note payable to Delavega Trading Ltd [Member]
Total	27,100	27,100
Note payable to Maple Gas Corporation [Member]
Total	$ 39,337	$ 39,337

XML

Related Party Transactions (Details Narrative) - USD ($)	3 Months Ended		6 Months Ended
	Oct. 31, 2014	Oct. 31, 2013	Oct. 31, 2014	Oct. 31, 2013	Apr. 30, 2014
Reimbursed amount outstanding	$ 31,633		$ 31,633		$ 31,633
Amortization of the debt discount			115,910	$ 266,008
Accrued expenses - related party	1,515,767		1,515,767		$ 1,159,608
Maple Gas Advances [Member]
Amortization of the debt discount	29	$ 0	42	$ 0
Balance of debt discount	$ 72		$ 72

XML

Property and Equipment (Details) - USD ($)	Oct. 31, 2014	Apr. 30, 2014
Property And Equipment Details
Computer software and hardware	$ 25,023	$ 25,023
Less accumulated depreciation and amortization	(20,187)	(17,685)
Property and equipment, net	$ 4,836	$ 7,338

XML

Property and Equipment (Details Narrative) - USD ($)	3 Months Ended		6 Months Ended
	Oct. 31, 2014	Oct. 31, 2013	Oct. 31, 2014	Oct. 31, 2013
Property And Equipment Details Narrative
Depreciation and amortization	$ 1,251	$ 1,250	$ 2,502	$ 2,502

XML

Accrued Expenses (Details) - USD ($)	Oct. 31, 2014	Apr. 30, 2014
Total Accrued Expenses	$ 3,060,034	$ 2,555,813
Payroll Employees [Member]
Total Accrued Expenses	973,798	725,817
Consulting [Member]
Total Accrued Expenses	1,260,054	1,083,616
Dividend [Member]
Total Accrued Expenses	360,685	310,685
Interest [Member]
Total Accrued Expenses	402,956	373,154
Other [Member]
Total Accrued Expenses	$ 62,541	$ 62,541

XML

Notes Payable (Details) - USD ($)	Oct. 31, 2014	Apr. 30, 2014
Notes payable	$ 375,000	$ 375,000
Note Payable [Member]
Notes payable	300,000	300,000
Note payable One [Member]
Notes payable	25,000	25,000
Note payable Two [Member]
Notes payable	$ 50,000	$ 50,000

XML

Notes Payable (Details 1) - USD ($)	Oct. 31, 2014	Apr. 30, 2014
Total	$ 2,145,001	$ 2,145,001
Less discount
Net	2,145,001	2,145,001
Convertible Notes Payable [Member]
Total	1,650,000	1,650,000
Convertible Notes Payable One [Member]
Total	120,000	120,000
Convertible Notes Payable Two [Member]
Total	180,000	180,000
Convertible Notes Payable Three [Member]
Total	120,000	120,000
Convertible Notes Payable Four [Member]
Total	$ 75,001	$ 75,001

XML

Notes Payable (Details Narrative) - USD ($)	Oct. 31, 2014	Apr. 30, 2014
Notes Payable Details Narrative
Accrued interest	$ 214,602	$ 193,977

XML

Convertible Preferred Stock (Details Narrative) - USD ($)	3 Months Ended		6 Months Ended
	Oct. 31, 2014	Oct. 31, 2013	Oct. 31, 2014	Oct. 31, 2013	Apr. 30, 2014
Amortization of debt discounts			$ 115,910	$ 266,008
Preferred Stock - Mandatory Redemption Right [Member]
Amortization of debt discounts	$ 62,020	$ 35,245	115,868	65,845
Amortization on loan costs	2,500	2,500	5,000	5,000
Unpaid dividends payable	360,685		360,685		$ 310,685
Convertible Preferred Stock [Member]
Amortization of debt discounts	131,002	$ 155,216	253,532	$ 390,283
Accrued dividends	178,665		178,665		144,289
Remaining accrued interest	$ 137,500		$ 137,500		$ 137,500

XML

Stockholders' Deficit (Details)	6 Months Ended
	Oct. 31, 2014 $ / shares shares
Number of options
Beginning Balance | shares	2,000,000
Granted | shares
Canceled / Expired | shares
Exercised | shares
Ending Balance | shares	2,000,000
Weighted Average Exercise Price Per share
Beginning Balance | $ / shares	$ 0.35
Granted | $ / shares
Canceled / Expired | $ / shares
Exercised | $ / shares
Ending Balance | $ / shares	$ 0.35
Weighted Average Remaining Contractual Life (in years) Beginning	8 years 9 months 29 days
Weighted Average Remaining Contractual Life (in years) Outstanding Ending	8 years 3 months 29 days

XML

Stockholders' Deficit (Details 1)	6 Months Ended
	Oct. 31, 2014 $ / shares shares
Number of warrants
Beginning Balance | shares	2,000,000
Granted | shares
Exercised | shares
Canceled / Expired | shares
Ending Balance | shares	2,000,000
Weighted Average Exercise Price Per Share
Beginning Balance | $ / shares	$ 0.35
Granted | $ / shares
Exercised | $ / shares
Canceled / Expired | $ / shares
Ending Balance | $ / shares	$ 0.35
Weighted Average Remaining Contractual Life (in years) Beginning	8 years 9 months 29 days
Weighted Average Remaining Contractual Life (in years) Outstanding Ending	8 years 3 months 29 days
Warrants [Member]
Number of warrants
Beginning Balance | shares	32,865,345
Granted | shares	10,000
Exercised | shares
Canceled / Expired | shares
Ending Balance | shares	32,875,345
Weighted Average Exercise Price Per Share
Beginning Balance | $ / shares	$ 0.33
Granted | $ / shares	0.05
Exercised | $ / shares
Canceled / Expired | $ / shares
Ending Balance | $ / shares	$ 0.33
Weighted Average Remaining Contractual Life (in years) Beginning	1 year 5 months 1 day
Weighted Average Remaining Contractual Life (in years) Outstanding Ending	11 months 1 day

XML

Stockholders' Deficit (Details Narrative)	6 Months Ended
	Oct. 31, 2014 shares
ChangesInStockholdersEquityDeficitDetailsNarrativeAbstract
Common stock reserved for issuance of warrants	32,875,345
Common stock warrants	10,000
Common stock reserved for debt conversion	16,485,639
Common stock reserved	49,350,984