Related Party Transactions / Balances

9 Months Ended

Aug. 31, 2011

Related Party Transactions / Balances [Text Block]

12.	Related Party Transactions / Balances
	a)	The Company has had related party transactions with Tri-Con Mining Ltd., Tri-Con Mining Inc. and Tri-Con Mining Alaska Inc. (collectively, the “Tri-Con Group”), all of which are controlled by a director and officer of the Company. The Tri-Con Group are operations, exploration and development contractors and have been employed by the Company under contract since 1972 to carry out all the Company’s fieldwork and to provide administrative and management services.
		Under the current contracts dated January 1, 1997, Tri-Con Group bills the Company cost plus 25% for exploration and cost plus 15% for development, mining and reclamation. The term “cost” means out-of-pocket or actual cost incurred by Tri-Con Group plus 15% for office overhead including stand-by and contingencies. There is no mark-up on capital purchases. The Tri-Con Group does not charge the Company for the services of its directors who are also directors of the Company. In addition, per the terms of the agreements, the Company paid a base administration fee of CDN $10,000 per month to Tri-Con Mining Ltd. and US $10,000 per month to Tri-Con Mining Inc., respectively. Both the Company the Tri-Con Group have the right to terminate the agreement in its entirety at any time upon 30 days advances written notice.
		During the nine months ended August 31, 2011, the Tri-Con Group’s services focused mainly on corporate planning; mining, drilling and engineering planning and preparation for production on the Company’s Nolan property; and administration services. During the nine months ended August 31, 2011, there were nominal exploration activities due to the Company’s cash flow constraints and consequently the Tri-Con Group waived the US $10,000 monthly fee and the CDN $10,000 monthly fee for the nine months ended August 31, 2011 for a total of US $181,937.
		As of August 31, 2011, the Company owed $676,340 (November 30, 2010 - $849,026) to the Tri-Con Group for exploration and administration services performed on behalf of the Company. The following is a summary of Tri-Con Group charges for the nine months ended August 31, 2011 and 2010:

		Nine months		Nine months
		ended		ended
		August 31, 2011		August 31, 2010
Administration and management services	$	51,596	$	130,702
Amount of total charges in excess of the cost	$	7,678	$	17,048
Percentage of excess of the cost charged over total amount billed		14.88%		13.04%

b) As of August 31, 2011, the Company owed $3,102 (November 30, 2010 – $3,120) to the President of the Company for amounts advanced. The advances are due on demand, unsecured, and non-interest bearing.

c)	As of August 31, 2011, the Company owed $1,021 (November 30, 2010 - $nil) to the spouse of the President of the Company for amounts advanced. The advances are due on demand, unsecured, and non-interest bearing.
d)	As of November 30, 2010, the Company owed $19,598 (Cdn$20,000) to a director of the Company for amounts advanced. The advances were due on demand, unsecured and bore interest at 5% per annum. During the nine months ended August 31, 2011, the Company repaid the advances.
e)	Effective April 1, 2009, a consulting agreement was signed between the Company and a private company controlled by a former director of the Company who resigned on April 20, 2010. Pursuant to the agreement, the Company agreed to pay the private company Cdn$7,500 plus GST per month for corporate planning, business development and investor relations services, as requested by the Company. During the nine months ended August 31, 2011, the Company was billed $22,984 (Cdn$22,500) (2010 - Cdn$67,500) by the private company. At August 31, 2011, the Company is indebted to the private company for $4,224 (November 30, 2010 - $15,372). This amount has been recorded in accounts payable and accrued liabilities.