As of December 31, 2011, there is no outstanding amount due to Shamika Resources Inc.[/
From inception to September 30, 2011, the Company operated under a management agreement with a related party Shamika Resources, Inc, which is controlled by the Company's former CEO, Robert Vivian. The Company had no employees or office expenses as such were provided by consultants through the management agreement with Shamika Resources, Inc. During 2011 and 2010, the agreement with Shamika Resources, Inc. was informal and $684,821 and $40,000, respectively was accrued to be paid to Shamika Resources, Inc. under the agreement. However, the management fees were reduced following a negotiated debt forgiveness in connection with the termination of the agreement effective September 30, 2011 in the amount of $294,776 for a net 2011 expense of $390,045. As of December 31, 2011, there is no outstanding amount due to Shamika Resources Inc. As of December 31, 2010, $9,613 was due to Shamika Resources, Inc.
During 2010 and 2011, the Company did not maintain any cash or bank accounts but relied upon advances from and payables to Shamika Resources, Inc, under the management agreement. Shamika Resources, Inc. held any cash the Company raised as a result of debt or equity issuances and made payments for services on the Company's behalf.
From October 1, 2011 to December 31, 2011, the Company operated under an informal consulting agreement with Henry Riedl, the Company’s current CEO. During this period, $33,625 was accrued to be paid to Mr. Riedl under the agreement. As of December 31, 2011, the entire $33,625 remains in accounts payable to related party.
Related party payables are recorded at their cost, are non-interest bearing, unsecured and have no specific terms for repayment.
