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Subsequent Events
12 Months Ended
Sep. 30, 2011
Subsequent Events  
Subsequent Events [Text Block]

 

NOTE 17SUBSEQUENT EVENTS:

Subsequent to September 30, 2011, the Company closed the sale of all of the common stock of its wholly owned subsidiary, Timberline Drilling.  Total consideration received by the Company includes $8,000,000 in cash, an additional $2,000,000 in cash from the existing working capital of Timberline Drilling, a $1,350,000 note receivable, an agreement by Timberline Drilling to provide discounted drilling services to the Company or cash with a total value of $1,100,000 over five years, a final working capital adjustment to be determined within sixty days of closing which is expected to be in excess of $1,000,000, as well as the assumption by the purchaser of approximately $1,000,000 in long term debt and obligations under capital leases of Timberline Drilling. 

 

The $1,350,000 note receivable is unsecured and subordinated and bears interest at 10% per annum, payable monthly, with the principal to be repaid on or before 18 months of the closing date of the sale. 

 

The Company expects to recognize a gain on the sale of its Timberline Drilling subsidiary of approximately $2,000,000 subject to the final working capital adjustment to be paid to the Company by Timberline Drilling.

 

In conjunction with the sale of Timberline Drilling, the Company repaid its $5,000,000 Convertible Term Note and all accrued interest outstanding to Juniper Resources, LLC, a company controlled by Ron Guill, a director of the Company (see Note 10).