RELATED PARTY TRANSACTIONS

3 Months Ended

Jan. 31, 2012

RELATED PARTY TRANSACTIONS [Text Block]

17. RELATED PARTY TRANSACTIONS

At January 31, 2012, all of Canal’s Long-Term Debt is held by the company’s Chief Executive Officer. The notes pay interest at a rate of 10% per annum and come due May 15, 2015. Canal has incurred interest expense on these notes of $21,000 and $21,000 for the three month periods ended January 31, 2012 and 2011, respectively. At various times during period the holder of these notes agrees to defer interest payments. This deferred interest liability accrues additional interest at a rate of 10% per annum, while outstanding and is repaid as funds become available. As of January 31, 2012, the balance due under these notes was $847,000 all of which is classified as long-term debt related party. Accrued interest of $105,875 and $84,700 is included in salaries and interest payable-officers at January 31, 2012 and October 31, 2011, respectively.