0001472375-17-000019.txt : 20170316 0001472375-17-000019.hdr.sgml : 20170316 20170315194823 ACCESSION NUMBER: 0001472375-17-000019 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 63 CONFORMED PERIOD OF REPORT: 20170131 FILED AS OF DATE: 20170316 DATE AS OF CHANGE: 20170315 FILER: COMPANY DATA: COMPANY CONFORMED NAME: I-Minerals Inc CENTRAL INDEX KEY: 0001405663 STANDARD INDUSTRIAL CLASSIFICATION: METAL MINING [1000] IRS NUMBER: 000000000 STATE OF INCORPORATION: A1 FISCAL YEAR END: 0430 FILING VALUES: FORM TYPE: 10-Q SEC ACT: 1934 Act SEC FILE NUMBER: 000-55321 FILM NUMBER: 17692627 BUSINESS ADDRESS: STREET 1: 880-580 HORNBY STREET CITY: VANCOUVER STATE: A1 ZIP: V6C 3B6 BUSINESS PHONE: (604) 303-6573 MAIL ADDRESS: STREET 1: 880-580 HORNBY STREET CITY: VANCOUVER STATE: A1 ZIP: V6C 3B6 FORMER COMPANY: FORMER CONFORMED NAME: i minerals inc DATE OF NAME CHANGE: 20070705 10-Q 1 form10q.htm QUARTERLY REPORT FOR THE PERIOD ENDED: JANUARY 31, 2017 Filed by Avantafile.com - I-Minerals Inc. - Form 10-Q

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

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

For the quarterly period ended: January 31, 2017

 [  ]  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:  000-55321

I-MINERALS INC.
(Exact name of registrant as specified in its charter)

British Columbia, Canada   20-4644299
(State or other jurisdiction of incorporation or organization)   (I.R.S. Employer Identification No.)

Suite 880, 580 Hornby Street, Vancouver, BC, Canada V6C 3B6
(Address of principal executive offices)(Zip Code)

(877) 303-6573
Registrant’s telephone number, including area code

Not applicable
(Former name or former address if changed since last report)

Securities registered under section 12(g) of the Exchange Act: Common shares with no par value.

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 [X] No [  ]

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 [X] No [  ]

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company.

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]

As of March 15, 2017, the registrant had 89,331,598 outstanding shares of common stock.


 

I-Minerals Inc.
INDEX

PartI. Financial Information 3
   
Item1.        Financial Statements (Unaudited) 3
   
Condensed consolidated balance sheets – January 31, 2017 and April 30, 2016 4
   
Condensed consolidated statements of loss – Nine months ended January 31, 2017 and 2016 5
   
Condensed consolidated statements of cash flows – Nine months ended January 31, 2017 and2016 6
   
Condensed consolidated statements of capital deficit – Nine months ended January 31, 2017 7
   
Notes to the condensed consolidated financial statements – January 31, 2017 8
   
Item2.        Management’s Discussion and Analysis of Financial Condition andResults of Operations 17
   
Item3.        Quantitative and Qualitative Disclosures About Market Risk 22
   
Item4.        Controls and Procedures 22
   
PartII. Other Information 23
   
Item1.        Legal Proceedings 23
   
Item1A.      Risk Factors 23
   
Item2.        Unregistered Sales of Equity Securities and use of Proceeds 23
   
Item3.        Defaults Upon Senior Securities 23
   
Item4.        Mine Safety Disclosures 23
   
Item5.        Other Information 23
   
Item6.        Exhibits 24
   
Signatures 24

2


 

PART I – FINANCIAL INFORMATION

I-Minerals Inc.

Condensed Consolidated Financial Statements
For the nine months ended January 31, 2017
(Unaudited - Expressed in US dollars)

3


 
I-Minerals Inc.
Condensed Consolidated Balance Sheets
(Unaudited - Expressed in US dollars)

  Notes   January 31,
2017
$
    April 30,
2016
$
 
ASSETS              
Current assets              
      Cash     408,475     128,353  
      Receivables     6,067     21,747  
      Prepaids     22,448     45,498  
      436,990     195,598  
               
Equipment     6,319     7,985  
Mineral property interest 3   305,850     305,850  
Deposits     14,932     14,932  
               
TOTAL ASSETS     764,091     524,365  
               
LIABILITIES              
Current liabilities              
      Accounts payable and accrued liabilities 4,8   644,716     1,023,137  
      Promissory notes 5   -     6,587,526  
      Derivative liabilities 2,6,7   966,683     515,802  
      Promissory notes 5   13,666,801     -  
      15,278,200     8,126,465  
               
Promissory notes 5   -     3,871,395  
TOTAL LIABILITIES     15,278,200     11,997,860  
               
CAPITAL DEFICIT              
Capital Stock              
Authorized:              
Unlimited common shares with no par value              
Issued and fully paid: 89,331,598 (April 30, 2016 - 86,328,952) 7   18,644,105     17,963,265  
Additional paid-in capital     1,924,136     1,839,639  
Commitment to issue shares 5   -     81,112  
Deficit     (35,082,350 )   (31,357,511 )
TOTAL CAPITAL DEFICIT     (14,514,109 )   (11,473,495 )
               
TOTAL LIABILITIES AND CAPITAL DEFICIT     764,091     524,365  

On behalf of the Board

“Thomas M. Conway”    Director “W. Barry Girling”    Director

The accompanying notes are an integral part of these condensed consolidated financial statements.

4


 
I-Minerals Inc.
Condensed Consolidated Statements of Loss
(Unaudited - Expressed in US dollars)

      Three months ended
January 31
    Nine months ended
January 31
 
  Notes   2017
$
    2016
$
    2017
$
    2016
$
 
                           
                           
OPERATING EXPENSES                          
Amortization     513     922     1,666     2,997  
Management and consulting fees 7,8   58,221     53,145     247,047     150,346  
Mineral property expenditures 8   387,812     848,075     1,055,024     2,382,611  
General and miscellaneous     163,224     120,214     523,486     412,267  
Professional fees     (377,824 )   36,028     (133,157 )   309,150  
                           
      (231,946 )   (1,058,384 )   (1,694,066 )   (3,257,371 )
OTHER (EXPENSE) INCOME                          
Foreign exchange (loss) gain     10,975     (646 )   (3,236 )   (361 )
Loss on settlement of liabilities     -     -     -     (31,512 )
Accretion expense 5   (120,031 )   (98,711 )   (363,386 )   (261,743 )
Interest expense 5   (416,623 )   (306,882 )   (1,159,725 )   (843,229 )
Change in fair value of derivative liabilities 2,6,7   (397,621 )   502,358     (504,426 )   659,687  
                           
LOSS FOR THE PERIOD     (1,155,246 )   (962,265 )   (3,724,839 )   (3,734,529 )
                           
Loss per share – basic and diluted     (0.01 )   (0.01 )   (0.04 )   (0.05 )
                           
Weighted average number of shares outstanding     88,611,697     84,367,010     87,650,365     82,311,551  

The accompanying notes are an integral part of these condensed consolidated financial statements.

5


 
I-Minerals Inc.
Condensed Consolidated Statements of Cash Flows
For the nine months ended January 31, 2017
(Unaudited - Expressed in US dollars)

    2017
$
    2016
$
 
OPERATING ACTIVITIES            
Loss for the period   (3,724,839 )   (3,734,529 )
Items not involving cash:            
           Amortization   1,666     2,997  
           Stock-based compensation   155,223     34,900  
           Loss on settlement of liabilities   -     31,512  
           Accretion expense   363,386     261,743  
           Change in fair value of derivative liabilities   504,426     (659,687 )
      Change in non-cash operating working capital items:            
           Receivables   15,680     (4,207 )
           Prepaids   23,050     111,793  
           Accounts payable and accrued liabilities   1,020,956     845,926  
             
      Cash flows used in operating activities   (1,640,452 )   (3,109,552 )
             
             
FINANCING ACTIVITIES            
      Proceeds from exercise of stock options and warrants   300,574     4,449  
      Promissory notes received   1,620,000     3,040,000  
             
      Cash flows from financing activities   1,920,574     3,044,449  
             
INCREASE (DECREASE) IN CASH   280,122     (65,103 )
             
CASH, BEGINNING OF THE PERIOD   128,353     272,040  
             
CASH, END OF THE PERIOD   408,475     206,937  
             
SUPPLEMENTAL CASH FLOW INFORMATION (Note 10)            
             
      Interest paid   -     -  
      Taxes paid   -     -  

The accompanying notes are an integral part of these condensed consolidated financial statements.

6


 
I-Minerals Inc.
Condensed Consolidated Statements of Capital Deficit
For the nine months ended January 31, 2017
(Unaudited - Expressed in US dollars)

    Number of Shares
#
    Amount
$
    Commitment to Issue Shares
$
    Additional Paid-in Capital
$
    Accumulated Deficit
$
    Total Capital Deficit
$
 
                                     
Balance at April 30, 2016   86,328,952     17,963,265     81,112     1,839,639     (31,357,511 )   (11,473,495 )
                                     
Issued during the period:                                    
      Shares issued on exercise of options   980,000     167,736     -     -     -     167,736  
      Shares issued on exercise of warrants   1,170,084     132,838     -     -     -     132,838  
      Shares issued as a debt discount   852,562     200,756     -     -     -     200,756  
      Shares issuable as a debt discount   -     -     (81,112 )   -     -     (81,112 )
Share-based payments – vesting   -     -     -     155,223     -     155,223  
Reallocation on exercise of options   -     70,726     -     (70,726 )   -     -  
Reallocation on exercise of warrants   -     108,784     -     -     -     108,784  
Loss for the period   -     -     -     -     (3,724,839 )   (3,724,839 )
                                     
Balance at January 31, 2017   89,331,598     18,644,105     -     1,924,136     (35,082,350 )   (14,514,109 )

The accompanying notes are an integral part of these condensed consolidated financial statements.

7


 
I-Minerals Inc.
Notes to the Condensed Consolidated Financial Statements
For the nine months ended January 31, 2017
(Unaudited - Expressed in US dollars except where otherwise indicated)

1. NATURE OF BUSINESS AND BASIS OF PRESENTATION AND LIQUIDITY:

  I-Minerals Inc. (the “Company”) was incorporated under the laws of British Columbia, Canada, in 1984. The Company is listed for trading on the TSX Venture Exchange under the symbol “IMA” and the OTCQX marketplace under the symbol “IMAHF”.

  The Company’s principal business is the development of the Helmer-Bovill industrial mineral property (“the Property”) located in Latah County, Idaho. The Helmer-Bovill property is comprised of eleven mineral leases that host potentially economic deposits of feldspar, quartz and kaolinitic clays, primarily kaolinite and halloysite.

  Basis of Presentation and Liquidity

  The accompanying unaudited condensed consolidated financial statements have been prepared by the Company in accordance with accounting principles generally accepted in the United States of America (“US GAAP”) for interim financial information as well as Article 10 of Regulation S-X on the basis that the Company will continue as a going concern, which assumes that the Company will be able to meet its obligations and continue its operations for the next year. Realization values may be substantially different from carrying values as shown and these financial statements do not give effect to adjustments that would be necessary to the carrying values and classification of assets and liabilities should the Company be unable to continue as a going concern. At January 31, 2017, the Company had not yet achieved profitable operations, had an accumulated deficit of $35,082,350 since inception and expects to incur further losses in the development of its business, all of which casts substantial doubt upon the Company’s ability to continue as a going concern and, therefore, that it may be unable to realize its assets and discharge its liabilities in the normal course of business.

  The Company’s ability to continue as a going concern is dependent upon its ability to obtain the necessary financing to develop the Property and to meet its obligations and repay its liabilities arising from normal business operations when they come due. Although the Company has been successful in the past in obtaining financing, there is no assurance that it will be able to obtain adequate financing in the future or that such financing will be on terms advantageous to the Company. The Company is currently receiving funds from a company controlled by a director of the Company through promissory notes (Notes 5 and 11). Management has no formal plan in place to address this concern but considers that the Company will be able to obtain additional funds by equity financing and/or promissory notes; however there is no assurance of additional funding being available. The Company has historically satisfied its capital needs primarily by issuing equity securities and/or promissory notes. Management plans to continue to provide for its capital needs by issuing equity securities and/or promissory notes.

  The financial statements do not include all of the information and footnotes required by accounting principles generally accepted in the United States of America for complete financial statements. In the opinion of our management, all adjustments (consisting of only normal recurring accruals) considered necessary for a fair presentation of the interim financial statements have been included. Operating results for the nine months ended January 31, 2017 are not necessarily indicative of the results that may be expected for the full year ending April 30, 2017. All amounts presented are in US dollars except where otherwise indicated. For further information refer to the financial statements and footnotes thereto for the year ended April 30, 2016 included in the Company’s Annual Report on Form 10-K filed on July 27, 2016.

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES:

  Financial Instruments and Fair Value Measures

  The book value of cash, accounts receivable, accounts payable and accrued liabilities approximate their fair values due to the immediate or short-term maturity of those instruments. The fair value hierarchy under US GAAP is based on three levels of inputs, of which the first two are considered observable and the last unobservable, that may be used to measure fair value which are the following:

8


 
I-Minerals Inc.
Notes to the Condensed Consolidated Financial Statements
For the nine months ended January 31, 2017
(Unaudited - Expressed in US dollars except where otherwise indicated)

  Level 1 - quoted prices (unadjusted) in active markets for identical assets or liabilities;

  Level 2 - observable inputs other than Level I, quoted prices for similar assets or liabilities in active prices whose inputs are observable or whose significant value drivers are observable; and

  Level 3 - assets and liabilities whose significant value drivers are unobservable by little or no market activity and that are significant to the fair value of the assets or liabilities.

  The Company’s Promissory Notes are based on Level 2 inputs in the ASC 820 fair value hierarchy. The Company calculated the fair value of these instruments by discounting future cash flows using rates representative of current borrowing rates. At January 31, 2017, the Promissory Notes had a fair value of $13,616,576 (April 30, 2016 – $10,703,836).

  The Company had certain Level 3 liabilities required to be recorded at fair value on a recurring basis in accordance with US GAAP as at January 31, 2017 and April 30, 2016. As at January 31, 2017, the Company’s Level 3 liabilities consisted of the warrants issued in connection with the Company’s offering of equity units in a private placement and warrants issued as financing fees as well as the grant of share purchase options to non-employees.

  The resulting Level 3 liabilities have no active market and are required to be measured at their fair value each reporting period based on information that is unobservable.

  A summary of the Company’s Level 3 liabilities for the nine months ended January 31, 2017 and 2016 is as follows:

      2017
$
    2016
$
 
               
  Warrants (Note 6)            
               
  Beginning fair value   326,595     1,128,841  
  Issuance   55,239     151,318  
  Reallocation on exercises of warrants   (108,784 )   -  
  Change in fair value   365,241     (631,185 )
  Ending fair value   638,291     648,974  
               
  Non-employee options (Note 7(c))            
               
  Beginning fair value   189,207     116,615  
  Fair value of options on vesting   -     42,933  
  Change in fair value   139,185     (28,502 )
  Ending fair value   328,392     131,046  
               
  Total Level 3 liabilities   966,683     780,020  

  Certain assets and liabilities are measured at fair value on a nonrecurring basis; that is, the instruments are not measured at fair value on an ongoing basis but are subject to fair value adjustments only in certain circumstances (for example, when there is evidence of impairment). There were no assets or liabilities measured at fair value on a nonrecurring basis during the periods ended January 31, 2017 and April 30, 2016.

  Earnings (Loss) Per Share

  The basic loss per common share is computed by dividing net loss available to common stockholders by the weighted average number of common shares outstanding. Diluted loss per common share is computed similar to basic loss per common share except that the denominator is increased to include the number of additional common shares that would have been outstanding if the potential common shares had been issued and if the additional common shares were dilutive. For the nine months ended January 31, 2017, loss per share excludes 9,226,082 (2016 – 30,414,438) potentially dilutive common shares (related to outstanding options and warrants as well as shares committed to be issued pursuant to the Promissory Notes) as their effect was anti-dilutive.

9


 
I-Minerals Inc.
Notes to the Condensed Consolidated Financial Statements
For the nine months ended January 31, 2017
(Unaudited - Expressed in US dollars except where otherwise indicated)

3. MINERAL PROPERTY INTEREST:

  Helmer-Bovill Property – Latah County, Idaho

  The Company has an undivided 100% interest in 11 State of Idaho mineral leases. The State of Idaho mineral leases are subject to a 5% production royalty on gross sales.

4. ACCOUNTS PAYABLE AND ACCRUED LIABILITIES:

      January 31,
2017
$
    April 30,
2016
$
 
               
  Trade payables   157,250     307,316  
  Amounts due to related parties (Note 8)   200,799     189,501  
  Interest payable on promissory notes   286,667     526,320  
               
  Total accounts payable and accrued liabilities   644,716     1,023,137  

5. PROMISSORY NOTES:

      January 31,
2017
$
    April 30,
2016
$
 
               
  First promissory notes   -     5,678,107  
  Second promissory notes   -     4,780,814  
  Third promissory notes   13,666,801     -  
               
  Total promissory notes   13,666,801     10,458,921  

  On September 13, 2013, January 27, 2014 and December 4, 2014, the Company entered into agreements with a company controlled by a director of the Company (the “Lender”) pursuant to which $5,787,280 was advanced to the Company in tranches (the “First Promissory Notes”). The First Promissory Notes were to mature as to $3,000,000 on December 2, 2016 and the balance due on December 31, 2016.

  On February 18, 2015 and December 1, 2015, the Company entered into agreements with the Lender pursuant to which $5,457,000 was advanced to the Company in tranches (the “Second Promissory Notes”). The Second Promissory Notes mature were to mature as to $1,000,000 on December 2, 2016, $2,000,000 on June 2, 2017 and the balance due on December 2, 2017.

  Effective August 31, 2016, the Company entered into an agreement (dated June 1, 2016) with the Lender pursuant to which up to an additional $2,965,000 will be advanced to the Company in tranches (the “Third Promissory Notes”). In addition, the First Promissory Notes and the Second Promissory Notes were amended and combined with the Third Promissory Notes with a modified maturity date of December 2, 2017. All other terms of the First Promissory Notes and the Second Promissory Notes remained unchanged.

  In accordance with the guidance of ASC 470-50 and ASC 470-60, the Company determined that the June 1, 2016 agreement resulted in a debt modification, not a debt extinguishment or a troubled debt restructuring. The aggregate finance fees relating to the promissory notes are now being amortized to the Statement of Loss over the revised life of the promissory notes using the effective interest method.

10


 
I-Minerals Inc.
Notes to the Condensed Consolidated Financial Statements
For the nine months ended January 31, 2017
(Unaudited - Expressed in US dollars except where otherwise indicated)

  During the nine months ended January 31, 2017, the Company received $1,420,000 in advances pursuant to the Third Promissory Notes and the final $200,000 in advances pursuant to the Second Promissory Notes.

  The following table outlines the estimated cash payments required in order to repay the principal balance of the Third Promissory Notes:

  2017
$
2018
$
2019
$
2020
$
2021
$
Total
$
  - 14,063,657 - - - 14,063,657

  Certain conditions may result in early repayment including immediate repayment in the event a person currently not related to the Company acquires more than 40% of the outstanding common shares of the Company. Debt issuance costs will be amortized over the estimated maturity life of the promissory notes.

  The promissory notes bear interest at the rate of 12% per annum and during the nine months ended January 31, 2017, the Company recorded interest of $1,159,725 (2016 - $525,136). Interest is payable semi-annually as calculated on May 31st and November 30th of each year. Interest is to be paid either in cash, in common shares or deemed an advance of principal at the option of the Lender. As part of the Third Promissory Notes agreement dated June 1, 2016, interest payable of $640,130 was transferred to the promissory notes balance as a deemed advance. This balance transferred was not subject to bonus shares or bonus warrants. The $640,130 of interest was for the period from December 1, 2015 to May 31, 2016. The lender elected to have interest payable from June 1, 2016 to November 30, 2016 of $759,247 deemed an advance (not subject to bonus shares or bonus warrants).

  The Company and the Lender agreed that the Lender is to receive bonus shares equal to 7.5% of each loan tranche advanced divided by the Company’s common share market price. In addition, the Company will issue the Lender an equal number of share purchase warrants for each loan tranche advanced. Each bonus share purchase warrant will entitle the Lender to purchase one common share of the Company at a price equal to the greater of (a) the market price of the Company’s common shares on the date of the advance and (b) the volume weighted average price of the Company’s common shares over the twenty trading days immediately prior to the date of the advance. The bonus share purchase warrants expire on the earlier of (a) December 31, 2018 and (b) the date the advance has been repaid in full, including interest.

  During the nine months ended January 31, 2017, the Company issued 852,562 bonus shares to the Lender at the fair value of $200,756, based on their quoted market price at the date the advances were received, including 349,325 shares having a fair value of $81,112 that the Company had committed to issue as at April 30, 2016. At January 31, 2017, the Company was committed to issuing no additional bonus shares to the Lender. The fair value of the bonus shares was determined by reference to the trading price of the Company’s common shares on the date the advances were received.

  The fair value of 534,480 bonus share purchase warrants committed to be issued (based on advances received during the period) during the nine months ended January 31, 2017 of $55,239 was estimated using the Black-Scholes option pricing model with the following weighted average assumptions: stock price – CAD$0.292; exercise price – CAD$0.299; expected risk-free interest rate – 1.15%; expected life – 2.40 years; expected volatility – 79% and expected dividend rate – 0%.

  The aggregate finance fees (bonus shares and bonus warrants) are recorded against the promissory notes balance and are being amortized to the Statement of Loss over the life of the promissory notes using the effective interest method. The accretion expense in respect of the debt discount recorded on the issuance of bonus shares and warrants totalled $363,386 for the nine months ended January 31, 2017 (2016 - $142,702) The unamortized debt discount as at January 31, 2017 is $396,856 (April 30, 2016 – $585,359).

  The promissory notes are collateralized by the Company’s Helmer-Bovill Property.

11


 
I-Minerals Inc.
Notes to the Condensed Consolidated Financial Statements
For the nine months ended January 31, 2017
(Unaudited - Expressed in US dollars except where otherwise indicated)

6. WARRANT LIABILITIES:

  The Company has share purchase warrants exercisable into common shares at an exercise price denominated in Canadian dollars. As a variable amount of US dollars are exercisable into a fixed number of common shares, the share purchase warrants are classified as derivative liabilities.

  The Company records the fair value of the share purchase warrants in accordance with ASC 815, “Derivatives and Hedging”. The Company uses the Black-Scholes option pricing model to calculate the fair values of the derivative liabilities. The fair value of the derivative liability is revalued on each balance sheet date with corresponding gains and losses recorded in the consolidated statement of loss.

      $  
         
  Balance, April 30, 2016   326,595  
         
  Bonus warrants issuable pursuant to promissory notes (Note 5)   55,239  
  Reallocation on exercise of warrants   (108,784 )
  Change in fair value of warrant derivatives   365,241  
         
  Balance, January 31, 2017   638,291  

  Warrant Derivative Liabilities

  At January 31, 2017, the Company determined the fair value of Warrant Derivative Liabilities to be $638,291 (April 30 2016 - $326,595) as estimated using the Black-Scholes option pricing model with the following weighted average assumptions:

      January 31,
2017
    April 30,
2016
 
               
  Stock price (CAD$)   0.390     0.23  
  Exercise price (CAD$)   0.308     0.27  
  Risk-free interest rate (%)   1.15     0.96  
  Expected life (years)   1.95     1.41  
  Expected volatility (%)   80     76  
  Expected dividends ($)   Nil     Nil  

7. SHARE CAPITAL:

  Common shares

  a) Authorized:

  Unlimited number of common shares, without par value.

  b) Stock transactions:

  During the nine months ended January 31, 2017, the Company completed the following stock transactions:

12


 
I-Minerals Inc.
Notes to the Condensed Consolidated Financial Statements
For the nine months ended January 31, 2017
(Unaudited - Expressed in US dollars except where otherwise indicated)

  i) On June 14, 2016, the Company issued 980,000 common shares on the exercise of stock options with an exercise price of CAD$0.22 per common share resulting gross proceeds of CAD$215,600 ($167,736).

  ii) On September 23, 2016, the Company issued 486,346 common shares with a fair value of $116,756 including 349,325 shares having a fair value of $81,112 which the Company had committed to issue at April 30, 2016. The common shares were issued as debt discounts pursuant to the Second Promissory Notes and the Third Promissory Notes (Note 5).

  iii) On December 1, 2016, the Company issued 1,170,084 common shares on the exercise of share purchase warrants with exercise prices ranging from CAD$0.14 to CAD$0.185 for gross proceeds of $132,838.

  iv) On January 25, 2017, the Company issued 366,216 common shares with a fair value of $84,000. The common shares were issued as debt discounts pursuant to the Third Promissory Notes (Note 5).

  c) Stock options:

  The Company has granted stock options under the terms of its Stock Option Plan (the “Plan”). The Plan provides that the directors of the Company may grant options to purchase common shares to directors, officers, employees and service providers of the Company on terms that the directors of the Company may determine are within the limitations set forth in the Plan. The maximum number of shares available under the Plan is limited to 10% of the issued common shares. The maximum term of stock options is ten years. All stock options vest on the date of grant, unless otherwise stated. As at January 31, 2017, the Company had 2,378,160 stock options available for grant pursuant to the Plan (April 30, 2016 - 2,797,895).

  The Company’s stock options outstanding as at January 31, 2017 and April 30, 2016 and the changes for the years then ended are as follows:

    Number Outstanding Weighted Average
Exercise Price
(in CAD$)
       
  Balance outstanding at April 30, 2016 5,835,000 0.21
  Granted 1,700,000 0.25
  Exercised (980,000) 0.22
       
  Balance outstanding at January 31, 2017 6,555,000 0.22
       
  Balance exercisable at January 31, 2017 5,545,000 0.22

  The intrinsic value of options exercised during the nine months ended January 31, 2017 was CAD$88,200 based on a stock price of CAD$0.31 on the date of exercise.

  Summary of stock options outstanding at January 31, 2017:

13


 
I-Minerals Inc.
Notes to the Condensed Consolidated Financial Statements
For the nine months ended January 31, 2017
(Unaudited - Expressed in US dollars except where otherwise indicated)

  Security Number Outstanding Exercise Price
(CAD$)
Expiry Date Remaining Contractual Life (years)
           
  Stock options 1,300,000 0.10 July 30, 2018 1.49
  Stock options 260,000 0.15 July 30, 2018 1.49
  Stock options 300,000 0.25 July 30, 2018 1.49
  Stock options 200,000 0.25 November 19, 2018 1.80
  Stock options 150,000 0.25 January 8, 2019 1.94
  Stock options 300,000 0.25 May 23, 2019 2.31
  Stock options 150,000 0.25 December 16, 2017 0.87
  Stock options 1,975,000 0.25 January 29, 2020 2.99
  Stock options 200,000 0.25 August 4, 2020 3.51
  Stock options 1,000,000 0.25 February 25, 2018 1.07
  Stock options 20,000 0.22 May 19, 2018 1.30
  Stock options 300,000 0.30 July 21, 2021 4.47
  Stock options 400,000 0.30 November 3, 2021 4.76

  The weighted average grant date fair value of stock options granted during the nine months ended January 31, 2017 of CAD$0.123 was estimated using the Black-Scholes option pricing model with the following weighted average assumptions: stock price – CAD$0.25; exercise price – CAD$0.25; risk-free interest rate – 1.08%; expected life – 3.24 years; expected volatility – 85% and expected dividends - $nil. Expected volatility was determined by reference to the historical volatility of the Company’s common shares trading on the TSX Venture Exchange.

  Non-Employee Stock Options

  In accordance with the guidance of ASC 815-40-15, stock options awarded to non-employees that are fully vested and exercisable in Canadian dollars are required to be accounted for as derivative liabilities because they are considered not to be indexed to the Company’s stock due to their exercise price being denominated in a currency other than the Company’s functional currency. Stock options awarded to non-employees that are not vested are accounted for as equity awards until the terms associated with their vesting requirements have been met. As at January 31, 2017, there were 400,000 (April 30, 2016 - nil) non-employee stock option awards that had not yet vested.

  The non-employee stock options are accounted for at their respective fair values and are summarized as follows for the nine months ended January 31, 2017 and 2016:

      2017
$
    2016
$
 
               
  Fair value of non-employee options, beginning of the period   189,207     116,615  
  Fair value of options on vesting   -     42,933  
  Change in fair value of non-employee stock options during the period   139,185     (28,502 )
               
  Fair value of non-employee options, end of the period   328,392     131,046  

  The Company determined the fair value of its non-employee stock options as at January 31, 2017 and April 30, 2016 using the Black-Scholes option pricing model with the following weighted average assumptions:

      January 31,
2017
    April 30,
2016
 
               
  Stock price (CAD$)   0.39     0.23  
  Exercise price (CAD$)   0.23     0.23  
  Risk-free interest rate (%)   0.86     1.34  
  Expected life (years)   1.66     2.43  
  Expected volatility (%)   61     87  
  Expected dividends ($)   Nil     Nil  

  The non-employee options are required to be re-valued with the change in fair value of the liability recorded as a gain or loss on the change of fair value of derivative liability and included in other items in the Company’s Consolidated Statements of Loss at the end of each reporting period. The fair value of the options will continue to be classified as a liability until such time as they are exercised, expire or there is an amendment to the respective agreements that renders these financial instruments to be no longer classified as a liability.

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I-Minerals Inc.
Notes to the Condensed Consolidated Financial Statements
For the nine months ended January 31, 2017
(Unaudited - Expressed in US dollars except where otherwise indicated)

  As at January 31, 2017, the unamortized compensation cost of options is $105,809 and the intrinsic value of options expected to vest is $729,614 (CAD$949,400).

  Share-based payments are classified in the Company’s Statement of Loss during the nine months ended January 31, 2017 and 2016 as follows:

      2017
$
    2016
$
 
               
  Management and consulting fees   155,223     34,900  
               
      155,223     34,900  

  d) Share purchase warrants:

  A summary of fully-exercisable share purchase warrants as at January 31, 2017 and April 30, 2016 and the changes for the years then ended are as follows:

      Number
Outstanding
    Weighted Average
Exercise Price
(CAD$)
 
               
  Balance at April 30, 2016   5,812,212     0.27  
  Issued   534,480     0.30  
  Exercised   (1,170,084 )   0.15  
  Expired   (955,526 )   0.26  
               
  Balance at January 31, 2017   4,221,082     0.31  

  Summary of warrants outstanding and issuable at January 31, 2017:

  Security Number Outstanding Exercise Price
($CAD)
Expiry Date
         
  Warrants 730,848 0.22 December 31, 2018(1)
  Warrants 242,545 0.23 December 31, 2018(1)
  Warrants 194,344 0.24 December 31, 2018(1)
  Warrants 37,203 0.245 December 31, 2018(1)
  Warrants 393,058 0.255 December 31, 2018(1)
  Warrants 192,206 0.259 December 31, 2018(1)
  Warrants 126,843 0.265 December 31, 2018(1)
  Warrants 198,750 0.272 December 31, 2018(1)
  Warrants 95,781 0.291 December 31, 2018(1)
  Warrants 49,294 0.294 December 31, 2018(1)
  Warrants 100,373 0.295 December 31, 2018(1)
  Warrants 101,095 0.298 December 31, 2018(1)
  Warrants 150,246 0.310 December 31, 2018(1)
  Warrants 58,496 0.335 December 31, 2018(1)
  Warrants 1,500,000 0.40 January 31, 2019

  Notes:

  (1) The warrants are exercisable until the earlier of the date disclosed or the date that the promissory note advance, including interest, is repaid (Note 5).

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I-Minerals Inc.
Notes to the Condensed Consolidated Financial Statements
For the nine months ended January 31, 2017
(Unaudited - Expressed in US dollars except where otherwise indicated)

8. RELATED PARTY TRANSACTIONS:

  During the nine months ended January 31, 2017, management and consulting fees of $72,185 (2016 - $72,099) were charged by RJG Capital Corporation, a wholly-owned company of W. Barry Girling, Director. Wayne Moorhouse, Director, charged $2,179 (2016 - $2,293) in management and consulting fees. $20,096 (2016 - $17,776) was charged by Malaspina Consultants Inc. for the services of Matt Anderson, CFO, and are included in professional fees. John Theobald, Director, charged $36,542 (2016 - $nil) in mineral property expenditures.

  Included in accounts payable and accrued liabilities are amounts owed to directors or officers or companies controlled by them. As at January 31, 2017, the amount was $200,799 (April 30, 2016 – $189,501). All amounts are non-interest bearing, unsecured, and due on demand.

  The promissory notes received from a company controlled by a director (Notes 5 and 11) are related party transactions.

9. SEGMENT DISCLOSURES:

  The Company considers its business to comprise a single operating segment being the exploration of its resource property. Substantially all of the Company’s long-term assets and operations are located in Latah County, Idaho.

10. NON-CASH TRANSACTIONS:

  Investing and financing activities that affect recognized assets or liabilities but that do not result in cash receipts or cash payments are excluded from the consolidated statements of cash flows. During the nine months ended January 31, 2017, the following transactions were excluded from the consolidated statement of cash flows:

  a) The commitment to issue 534,480 common shares at the fair value of $119,644 and 534,480 warrants at the fair value of $55,239 pursuant to the promissory notes.

  During the nine months ended January 31, 2016, the following transactions were excluded from the consolidated statement of cash flows:

  a) The issuance by the Company of 3,825,822 common shares at the fair value of $708,883 as payment of interest on the Promissory Notes;

  b) The issuance by the Company of 1,390,294 common shares at the fair value of $54,035 as payment of interest on the Second Promissory Notes; and,

  c) The commitment to issue 1,223,843 common shares at the fair value of $293,623 and 1,223,843 warrants at the fair value of $151,318 pursuant to the Second Promissory Notes.

11. SUBSEQUENT EVENTS:

  Subsequent to January 31, 2017:

  a) The Company received an aggregate of $125,000 of Third Promissory Notes.

  b) On March 13, 2017, the Company entered into a loan agreement with an arm’s-length lender pursuant to which up to CAD$250,000 may be advanced to the Company, subject to TSX Venture Exchange approval. The loan will bear interest at a rate of 12% per annum and is due on or before December 31, 2018. The Company and the lender agreed that the lender is to receive bonus shares equal to 7.5% of the loan divided by the Company’s common share market price. In addition, the Company will issue the Lender an equal number of share purchase warrants.

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Item 2.  Management’s discussion and analysis of financial condition and results of operations

CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS

Certain statements contained in this Quarterly Report constitute "forward-looking statements.” These statements, identified by words such as “plan,” "anticipate,” "believe,” "estimate,” "should,” "expect" and similar expressions include our expectations and objectives regarding our future financial position, operating results and business strategy. Forward-looking statements involve known and unknown risks, uncertainties, assumptions and other factors that may cause our actual results, performance or achievements to be materially different from any future results, performance or achievements expressed or implied by the forward-looking statements. Such factors include, among others, general business, economic, competitive, political and social uncertainties; the actual results of current exploration activities; changes in project parameters as plans continue to be refined; changes in labour costs or other costs of production; future mineral prices; equipment or processes to operate as anticipated; accidents, labour disputes and other risks of the mining industry, including but not limited to environmental hazards, cave-ins, pit-wall failures, flooding, rock bursts and other acts of God or unfavourable operating conditions and losses; delays in obtaining governmental approvals or financing or in the completion of development or construction activities, as well as those factors discussed in the section titled "Risk Factors" in our Annual Report on Form 10-K which was filed with the SEC on July 27, 2016.

Forward looking statements are based on a number of material factors and assumptions, including the results of exploration and drilling activities, the availability and final receipt of required approvals, licenses and permits, that sufficient working capital is available to complete proposed exploration and drilling activities, that contracted parties provide goods and/or services on the agreed time frames, the equipment necessary for exploration is available as scheduled and does not incur unforeseen break downs, that no labour shortages or delays are incurred and that no unusual geological or technical problems occur. While we consider these assumptions may be reasonable based on information currently available to it, they may prove to be incorrect. Actual results may vary from such forward-looking information for a variety of reasons, including but not limited to risks and uncertainties disclosed in the section titled “Risk Factors” in our Annual Report on Form 10-K which was filed with the SEC on July 27, 2016.

We intend to discuss in our Quarterly Reports and Annual Reports any events or circumstances that occurred during the period to which such documents relate that are reasonably likely to cause actual events or circumstances to differ materially from those disclosed in this Quarterly Report. New factors emerge from time to time, and it is not possible for management to predict all of such factors and to assess in advance the impact of each such factor on our business or the extent to which any factor, or combination of such factors, may cause actual results to differ materially from those contained in any forwarding looking statement.

CAUTIONARY NOTE TO U.S. INVESTORS REGARDING ESTIMATES OF MEASURED, INDICATED AND INFERRED RESOURCES AND PROVEN AND PROBABLE RESERVES

The terms “mineral reserve”, “proven mineral reserve” and “probable mineral reserve” as used in this Quarterly Report are Canadian mining terms as defined in accordance with Canadian National Instrument 43-101 – Standards of Disclosure for Mineral Projects (“NI 43-101”) and the Canadian Institute of Mining, Metallurgy and Petroleum (the “CIM”) – CIM Definition Standards on Mineral Resources and Mineral Reserves, adopted by the CIM Council, as amended (the “CIM Definition Standards”). These definitions differ from the definitions in the United States Securities and Exchange Commission (“SEC”) Industry Guide 7 (“SEC Industry Guide 7”) under the United States Securities Act of 1933, as amended (the “Securities Act”). Under SEC Industry Guide 7 standards, a “final” or “bankable” feasibility study is required to report reserves, the three-year historical average price is used in any reserve or cash flow analysis to designate reserves, and the primary environmental analysis or report must be filed with the appropriate governmental authority.

In addition, the terms “mineral resource”, “measured mineral resource”, “indicated mineral resource” and “inferred mineral resource” are defined in and required to be disclosed by NI 43-101; however, these terms are not defined terms under SEC Industry Guide 7 and are normally not permitted to be used in reports and registration statements filed with the SEC. Investors are cautioned not to assume that all or any part of a  mineral deposit in these categories will ever be converted into reserves. “Inferred mineral resources” have a great amount of uncertainty as to their existence, and great uncertainty as to their economic and legal feasibility. It cannot be assumed that all, or any part, of an inferred mineral resource will ever be upgraded to a higher category. Under Canadian rules, estimates of inferred mineral resources may not form the basis of feasibility or pre-feasibility studies, except in rare cases. Investors are cautioned not to assume that all or any part of an inferred mineral resource exists or is economically or legally mineable. Disclosure of unit measures in a resource is permitted disclosure under Canadian regulations; however, the SEC only permits issuers to report mineralization that does not constitute “reserves” by SEC standards as in place tonnage and grade without reference to unit measures.

17


 

Accordingly, information contained in this Quarterly Report and any documents incorporated by reference herein contain descriptions of our mineral deposits that may not be comparable to similar information made public by U.S. companies subject to the reporting and disclosure requirements under the United States federal securities laws and the rules and regulations thereunder.

As used in this Quarterly Report, unless the context otherwise requires, “we,” “us,” “our,” the “Company” and “I-Minerals” refers to I-Minerals Inc.  All dollar amounts in this registration statement are in U.S. dollars unless otherwise stated.

General

We were incorporated under the laws of British Columbia, Canada in 1984. In 2004, we changed our corporate jurisdiction from a British Columbia company to a Canadian corporation.  At the Annual General and Special Meeting of the Shareholders held on December 7, 2016, the shareholders approved the change of jurisdiction of I-Minerals from the Federal Jurisdiction of Canada to the Province of British Columbia.  In December 2011, we amended our articles to change our name from “i-minerals inc.” to “I-Minerals Inc.”

The Company engaged in the development of our Helmer-Bovill industrial minerals property (the “Helmer-Bovill Property”).  The Helmer-Bovill Property, in which we hold a 100% interest, is comprised of 11 mineral leases totaling 5,140.64 acres located approximately 6 miles southwest of Bovill, Latah County, Idaho.

We acquired the Helmer-Bovill Property from Idaho Industrial Minerals (“IIM”) pursuant to an Assignment Agreement with Contingent Right of Reverter (the “IIM Agreement”) dated August 12, 2002, as amended August 10, 2005, August 10, 2008 and January 21, 2010, between I-Minerals USA (formerly Alchemy Kaolin Corporation), our wholly owned subsidiary, and IIM.  Under the terms of the IIM Agreement, we issued a total of 1,800,000 common shares to IIM.

Our principal executive office is located at Suite 880, 580 Hornby Street, Vancouver, British Columbia, Canada and our telephone number is (877) 303-6573.

To date, we have not earned significant revenues from the operation of our mineral properties.  Accordingly, we are dependent on debt and equity financing as our primary source of operating working capital.  Our capital resources are largely determined by the strength of the junior resource markets and by the status of our projects in relation to these markets, and its ability to compete for investor support of its projects.

Our Principal Projects

Our activities at the Helmer-Bovill Property are focused on developing the Bovill Kaolin Project and the WBL Tailings Project.

The Bovill Kaolin Project

Our lead project, the Bovill Kaolin Project, is a strategically located long term resource of high purity quartz, potassium feldspar (“K-spar”), halloysite and kaolinite formed through weathering of a border phase of the Idaho Batholith causing all minerals to be contained within a fine white clay-sand mixture referred to as “primary clay.” The Bovill Kaolin Project is located within 5 miles of state highways with electricity and natural gas already at the property boundary.

Since 2010, our exploration work has focused diamond drilling on the Bovill Kaolin Project.  To date, a total of 258 diamond drill holes have been drilled totaling 28,251 feet.  As a result of these drill campaigns, four deposits have been identified: Kelly’s Hump, Kelly’s Hump South, Middle Ridge and WBL.

In June 2014, we completed an updated pre-feasibility study on the Bovill Kaolin Project (the “2014 PFS”) and on March 8, 2016, we announced the economic results of our full feasibility study (the “2016 FS”), which included the following highlights:

●         Updated Measured and Indicated Resource Estimate

  ● Measured Resources of 5.7 million tons containing 76.5% quartz/K-spar sand, 12.3% Kaolinite and 4.0% Halloysite.

  ● Indicated Resources of 15.5 million tons containing 57.0% quartz/K-spar sand, 15.5% Kaolinite and 2.8% Halloysite.

  ● 667,000 tons of contained halloysite, 3,119,000 tons of contained kaolinite and 13,235,000 tons of contained quartz/K-spar.

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●         Updated Mineral Reserves.  All figures are in thousands of tons.

Reserve Proven Probable Total P&P
Tons (1000s) 4,155 4,548 8,702
Halloysite % 4.8 4.0 4.4
Halloysite Tons (1000s) 200 182 382
Kaolinite % 11.1 12.5 11.8
Kaolinite Tons (1000s) 460 568 1,028
Sand % 77.8 76.8 77.3
Sand Tons (1000s) 3,234 3,491 6,725

Note that values presented here have been rounded to reflect the level of accuracy.

Proven and Probable Mineral Reserves are presented using a $57.00 NSR cutoff grade.

●         Economic Analysis

  US$386 million Pre-Tax NPV; US$250 million After Tax NPV using a 6% discount rate.
  31.6% Pre-Tax IRR; 25.8% After Tax IRR.
  Initial Capital Cost of $108.3 million and Total Life of Mine capital costs $120.0 million.
  Life of Mine in excess of 25 years with a stripping ratio of 0.54:1 (waste:ore).
  3.7 year estimated after tax payback.

The full Feasibility Study was filed on www.sedar.com on April 20, 2016 and is available on the Company’s website.  Going forward our focus is to complete the longer lead time components of the detailed engineering, complete the permitting process with the Idaho Department of Lands (the “IDL”) and commence efforts to raise the capital necessary to build the mine.

The WBL Tailings Project

We also plan to continue limited seasonal mining operations at the WBL Tailings Project.  The WBL Tailings Project is feldspathic sands deposited as tailings from clay mining operations during the period from 1961 to 1974.  In September 2012, we received approval of our Mine Plan of Operations (“MPO”) from the Idaho Department of Lands.  The MPO allows us to mine up to 50,000 tons per annum of feldspathic sands from June to October for a period of 10 years.  Since 2013, approximately 5,000 tons of tailings was extracted and sold to a local cement company and a local contractor.  

Plan of Operation

During the next twelve months, our plan of operation is to complete the mine permitting and get all of the longer lead time engineering tasks such as the electricity and gas planning underway.  The Company is on its fourth iteration of the Operation and Reclamation Plan with the IDL and the list of outstanding items is relatively short.  Avista, the local utility, has started the initial scoping studies to bring electricity and gas the last five miles from its current terminus to the proposed mill site. In the interim we will continue to strengthen our customer list and continue discussions to raise the capital to fund the mine construction

Engineering work on the Bovill Kaolin Project

As recommended in the 2016 FS, we are about to begin the contemplated utility surveys and are undertaking additional pilot plant work to produce customer samples for marketing purposes and the related testwork for final equipment selection,.  Two pilot plants are currently ongoing with the first producing metakaolin and halloysite and the second producing quartz and K-spar.  Additional work is also ongoing to finalize the process plant water balance and utilities consumptions.  This work together with the General and Administrative expenses related in part to our continuing financing efforts are estimated to cost about US$2,000,000 before taking into consideration any possible land swap with the IDL. 

Outlook

Our focus continues to be the detailed assessment of all of our mineral assets and advancing the Bovill Kaolin Project towards production. With the FS now completed, the next steps are the final permitting activities. Strong progress has been made with the Idaho Department of Lands, the lead permitting agency, but there remain a few minor unforeseen information requests to complete. At this point the expectation is that final plan approval should be received in Q2 calendar 2017.

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A second bulk sample has been sent to Ginn Mineral Technologies (“GMT”) with separation of the clay minerals (kaolin and halloysite) nearing completion. The sand fraction from the second bulk sample will be sent to Minerals Research Laboratory at North Carolina State University (“MRL”). Processing of the sand fraction (quartz and K-spar) from the initial bulk sample is now completed at MRL. Samples of all quartz and K-spar products, including fine grind products, have been delivered to the Company for distribution to prospective customers for testing purposes. The earlier processing of the bulk samples at GMT created halloysite and metakaolin product samples for marketing purposes that are also being distributed for testing purposes. The first phase of our third pilot plant is nearing completion of the K-spar segment which has generated the highest K2O grades to date with results consistently in excess of 14% K2O. Additional material for the third pilot plant is being processed at GMT to make additional volumes of metakaolin for larger scale testing and additional halloysite for an increasing number of customers requesting halloysite for testing. Sample requests for halloysite have come from North America, Europe, the Middle East, South America and Asia showing both the scarcity of halloysite in general and the quality of I-Minerals halloysite in particular. Interest from companies pursuing research and development of life science and polymer applications with our halloysite is particularly encouraging. Once the clay portion of the pilot plant has been completed at GMT, the sand fraction will be sent to MRL for K-spar and quartz separation.

Based upon opportunities identified in the Charles Rivers report, internal marketing efforts and customer leads generated through the website, strong interest has been generated in all of the Company’s mineral products with ever increasing interest in the K-spar.  Samples continue to be sent to customers for testing and the response has generally been very favorable.

Results of Operation

Nine months ended January 31, 2017

We recorded a loss of $3,724,839 for the nine months ended January 31, 2017 as compared to a loss of $3,734,529 for the nine months ended January 31, 2016.  The decrease in the loss recorded for the nine months ended January 31, 2017 as compared to the nine months ended January 31, 2016 is the net result of changes to a number of expenses.  Of note are the following items:

  • Management and consulting fees of $247,047 (2015 - $150,346) are comprised of fees to manage our Company and stock-based compensation.  The stock-based compensation recognized in the current period was $155,223 (2016 - $34,900).  Approximately half of the fees to manage our Company are charged to management and consulting fees and the other half is charged to mineral property expenditures.
  • Mineral property expenditures of $1,055,024 (2016 - $2,386,611) are costs incurred on our Helmer-Bovill Property.  The main expenses incurred during the current period included engineering and consulting ($204,122), mineral analysis and processing ($240,222) and environmental ($141,600).  We were working on completing permitting work and final pilot plant processing during the current period.  In the prior period, the Company incurred $1,493,890 of engineering and consulting expenditures and mineral analysis and processing of $391,395 as part of updating the feasibility study. 
  • General and miscellaneous expenses of $523,486 (2016 - $412,267) are comprised of office and telephone expenses, payroll taxes, medical benefits, insurance premiums, travel expenses, promotional expenses, shareholder communication fees, transfer agent fees and filing fees.  The increase during the current period was due primarily to an increase in mineral marketing activities as well as investor relations activities.
  •  Professional fees recovery of $133,157 (2016 – expense of $309,150) include legal fees, audit fees and financial consulting fees.  The fees in the current period are negative as the Company recovered legal fees after settlement of a legal action. 
  • Accretion expense of $363,386 (2016 - $261,743) is the amortization of the fair value of bonus shares and bonus warrants issued to the lender of the promissory notes.  The bonus shares and bonus warrants are amortized over the life of the promissory notes.
  • Interest expense of $1,159,725 (2016 - $843,229) is from promissory notes that bear interest at a rate of 12% per year.  Interest increased as additional funds were advanced.
  • We recorded a loss on change in fair value of derivative liabilities of $504,426 (2016 – gain of $659,687).  The change in fair value of derivative liabilities is based on the change in remaining term of derivative instruments and our stock price.  The derivatives include warrants as well as stock options granted to non-employees.  The derivative liabilities do not represent cash liabilities.

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Three months ended January 31, 2017

We recorded a loss of $1,155,246 for the three months ended January 31, 2017 as compared to a loss of $962,265 for the three months ended January 31, 2016.  The increase in the loss recorded for the three months ended January 31, 2017 as compared to the three months ended January 31, 2016 is the net result of changes to a number of expenses as noted above under the nine months ended January 31, 2017 and 2016.  In particular, professional fees recovery of $377,824 was a result of recovering legal fees from settling an ongoing legal action.

Liquidity and Capital Resources

Our aggregate operating, investing and financing activities during the nine months ended January 31, 2017 resulted in a net cash inflow of $280,122 (2016 – outflow of $65,103).  As at January 31, 2017, we had a working capital deficiency of $14,841,210, including cash of $408,475. 

During the nine months ended January 31, 2017, $2,700,138 was used in operations before changes in non-cash operating working capital items (2016 - $4,063,064).  The decrease in these cash flows was due primarily to a decrease in mineral property expenditures.  During the nine months ended January 31, 2017, we spent $nil on investing activities (2016 - $nil) and we received $1,920,574 from financing activities (2016 - $3,044,449).

Currently, we are being financed by advances pursuant to promissory notes advanced by BV Lending LLC, an entity controlled by Allen L. Ball, a member of our Board of Directors and our largest shareholder (the “Lender”).  During the year ended April 30, 2016, the Company was receiving advances pursuant to the First Promissory Notes and the Second Promissory Notes.  As at April 30, 2016, the balance of the promissory notes was $11,044,280.  The final tranche pursuant to the Second Promissory Notes was received in May 2016.  Effective August 31, 2016, the Company entered into an agreement with the Lender pursuant to which up to an additional $2,965,000 will be advanced to the Company in tranches (the “Third Promissory Notes”), of which we have received $1,545,000 as at March 15, 2017.  The August 31, 2016 agreement also amended the maturity date of the First Promissory Notes and the Second Promissory Notes.  The promissory notes have a modified maturity date of December 2, 2017.  Certain conditions may result in early repayment.

We have not as yet put into commercial production any mineral properties and as such have no operating revenues.  Accordingly, we are dependent on debt and equity financing as its primary source of operating working capital.  Our capital resources are largely determined by the strength of the junior resource markets and by the status of our projects in relation to these markets, and our ability to compete for investor support of our projects.

We remain dependent on additional financing to fund development requirements on the Helmer-Bovill property and for general corporate costs.  With respect to funds required for capital cost items, State-sponsored debt financing instruments may be available on attractive terms, and we intend to pursue such financial instruments to cover portions of the capital costs associated with placing the Bovill Kaolin deposits into production.  We have commenced efforts to raise the capital necessary to build the mine.

We do not have the ability to internally generate sufficient cash flows to support our operations for the next twelve months.  We are currently receiving funds from a company controlled by a director of the Company through promissory notes.  We have no formal plan in place to address this going concern issue but consider that we will be able to obtain additional funds by equity financing and/or debt financing; however, there is no assurance of additional funding being available.  As a result, our auditors included an emphasis of matter note in their report on the financial statements for the year ended April 30, 2016 about our ability to continue as a going concern. 

Off-Balance Sheet Arrangements

We have no significant 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 is material to shareholders.

Critical Accounting Policies

Measurement Uncertainty

The preparation of these consolidated financial statements in conformity with US GAAP requires us to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenues and expenses during the reporting period.  We regularly evaluate estimates and assumptions related to the useful life and recoverability of long lived assets, stock-based compensation, valuation of convertible debentures and derivative liabilities, and deferred income tax asset valuation allowances. 

21


 

We base our estimates and assumptions on current facts, historical experience and various other factors that it believes to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities and the accrual of costs and expenses that are not readily apparent from other sources.  The actual results experienced by us may differ materially and adversely from our estimates.  To the extent there are material differences between the estimates and the actual results, future results of operations will be affected.  The most significant estimates with regard to our condensed consolidated financial statements relate to the determination of fair values of derivative liabilities and stock-based transactions.

Stock-based Compensation

We account for all stock-based payments and awards under the fair value based method.  Stock-based payments to non-employees are measured at the fair value of the consideration received, or the fair value of the equity instruments issued, or liabilities incurred, whichever is more reliably measurable.

The fair value of stock-based payments to non-employees is periodically re-measured until the counterparty performance is complete, and any change therein is recognized over the vesting period of the award and in the same manner as if we had paid cash instead of paying with or using equity based instruments.  The cost of the stock-based payments to non-employees that are fully vested and non-forfeitable as at the grant date is measured and recognized at that date, unless there is a contractual term for services in which case such compensation would be amortized over the contractual term.

We account for the granting of stock options to employees using the fair value method whereby all awards to employees will be recorded at fair value on the date of the grant.  The fair value of all stock options is expensed over their vesting period with a corresponding increase to additional paid-in capital.

Compensation costs for stock-based payments that do not include performance conditions are recognized on a straight-line basis. Compensation cost associated with a share based award having a performance condition is recognized on the probable outcome of that performance condition during the requisite service period. Share based awards with a performance condition are accrued on an award by award basis.

We use the Black-Scholes option valuation model to calculate the fair value of stock options at the date of the grant. Option pricing models require the input of highly subjective assumptions, including the expected price volatility. Changes in these assumptions can materially affect the fair value estimates.

Derivative Liabilities

We evaluate our financial instruments and other contracts to determine if those contracts or embedded components of those contracts qualify as derivatives to be separately accounted for in accordance with ASC 815. The result of this accounting treatment is that the fair value of the embedded derivative is marked-to-market at each balance sheet date and recorded as a liability and the change in fair value is recorded in the consolidated statement of loss.  Upon conversion or exercise of a derivative instrument, the instrument is marked to fair value at the conversion date and then that fair value is reclassified to equity.

The classification of derivative instruments, including whether such instruments should be recorded as liabilities or as equity, is re-assessed at the end of each reporting period.  Derivative instruments that become subject to reclassification are reclassified at the fair value of the instrument on the reclassification date.  Derivative instrument liabilities will be classified in the balance sheet as current or non-current based on whether or not settlement of the derivative instrument is expected within 12 months of the balance sheet date.

We use the Black-Scholes option valuation model to value derivative liabilities.  This model uses Level 3 inputs in the fair value hierarchy established by ASC 820 Fair Value Measurement.

Item 3. Quantitative and Qualitative Disclosures About Market Risk.

Not applicable

Item 4. Controls and Procedures.

The Company’s management, with the participation of the Company’s Chief Executive Officer and Chief Financial Officer, has evaluated the effectiveness of the Company’s disclosure controls and procedures as of January 31, 2017. Based on that evaluation, the Company’s Chief Executive Officer and Chief Financial Officer concluded that the Company’s disclosure controls and procedures were effective as of January 31, 2017.  There were no material changes in the Company’s internal control over financial reporting during the third quarter of 2017.

22


 

Part II – OTHER INFORMATION

Item 1. Legal Proceedings.

On December 2, 2016, I-Minerals and Unimin Corporation (“Unimin”), Joseph C. Shapiro (“Shapiro”), and Richard C. Zielke (“Zielke”) (Unimin, Shapiro and Zielke collectively the “Unimin Defendants”) entered into a settlement agreement (“Settlement Agreement”) relating to the subject matter of the lawsuit filed in March 2015.  Under the terms of the Settlement Agreement, the Unimin Defendants and I-Minerals agreed to grant each other full release of all claims, and the Unimin Defendants paid the Company an agreed-upon amount in exchange for the Company causing the lawsuit to be dismissed with prejudice. 

Item 1A. Risk Factors

There have been no material changes from the risk factors as previously disclosure in our Annual Report on Form 10-K which was filed with the SEC on July 27, 2016. 

Item 2. Unregistered sales of equity securities and use of proceeds

All unregistered sales of equity securities during the period covered by the Quarterly Report were previously disclosed in our current reports on Form 8-K or our Annual Report on Form 10-K other than the following:

  i) On June 14, 2016, the Company issued 980,000 common shares on the exercise of stock options with an exercise price of CAD$0.22 per common share resulting gross proceeds of CAD$215,600 ($167,736).

  ii) On September 23, 2016, the Company issued 486,346 common shares pursuant at a fair value of $116,756. The common shares were issued in accordance with the terms of loan agreements. The securities were issued pursuant to the provisions of Rule 506 of Regulation D of the Securities Act as the creditor represented that it was an accredited investor as defined in Rule 501 of Regulation D.

  iii) On December 1, 2016, the Company issued 1,170,084 common shares on the exercise of bonus warrants with exercise prices ranging from CAD$0.14 to CAD$0.185 for gross proceeds of $132,838.

  iv) On January 25, 2017, the Company issued 366,216 common shares with a fair value of $84,000. The common shares were issued as debt discounts pursuant to the Third Promissory Notes.

Item 3. Defaults upon senior securities

None

Item 4. Mine Safety Disclosures.

Pursuant to Section 1503(a) of the Dodd-Frank Wall Street Reform and Consumer Protection Act (The “Dodd-Frank Act”), issuers that are operators, or that have a subsidiary that is an operator, of a coal or other mine in the United States are required to disclose in their periodic reports filed with the SEC information regarding specified health and safety violations, orders and citations, related assessments and legal actions, and mining-related fatalities. During the nine months ended January 31, 2017, our U.S. exploration properties were not subject to regulation by the Federal Mine Safety and Health Administration (“MSHA”) under the Federal Mine Safety and Health Act of 1977 (the "Mine Act").

Item 5. Other Information

None

23


 

Item 6. Exhibits

3.1 Certificate of Continuation.(2)
3.2 Articles of Continuance.(2)
3.3 Certificate of Amendment.(2)
3.4 Articles of Amendment.(2)
3.5 By-Laws.(2)
10.1 Assignment Agreement with Contingent Right of Reverter dated August 10, 2002, between the Company, Idaho Industrial Minerals, LLC and Northwest Kaolin Inc.(2)
10.2 Amendment and Ratifications of Assignment Agreement with Contingent Right of Reverter dated August 10, 2005, between the Company, Idaho Industrial Minerals, LLC and Northwest Kaolin Inc.(2)
10.3 Second Amendment and Ratifications of Assignment Agreement with Contingent Right of Reverter dated August 10, 2005, between the Company, Idaho Industrial Minerals, LLC and Northwest Kaolin Inc.(2)
10.4 Third Amendment and Ratifications of Assignment Agreement with Contingent Right of Reverter dated August 10, 2008, between the Company, Idaho Industrial Minerals, LLC and Northwest Kaolin Inc.(2)
10.5 Fourth Amendment and Ratifications of Assignment Agreement with Contingent Right of Reverter dated January 1, 2010, between the Company, Idaho Industrial Minerals, LLC and Northwest Kaolin Inc.(2)
10.6 Employment Agreement dated April 1, 2013 between the Company and Thomas M. Conway.(2)
10.7 Loan Agreement dated September 13, 2013 between the Company and BV Lending LLC.(2)
10.8 Stock Option Plan.(1)
10.9 Sales Agreement dated April 28, 2014 between I-Minerals USA, Inc. and Pre-Mix, Inc.(2)
10.10 Loan Agreement dated February 18, 2015 between the Company and BV Lending LLC.(3)
10.11 Amendment Agreement dated December 1, 2015 between the Company and BV Lending LLC.(4)
10.12 Loan Agreement dated June 1, 2016 between the Company and BV Lending LLC. (5)
31.1 Certification of Chief Executive Officer pursuant to Section 302 of Sarbanes-Oxley Act of 2002 (Rule 13a-14 and 15d-14 of the Exchange Act)
31.2 Certification of Chief Financial Officer pursuant to Section 302 of Sarbanes-Oxley Act of 2002 (Rule 13a-14 and 15d-14 of the Exchange Act)
32.1 Certification of Chief Executive Officer pursuant to pursuant to Section 1350 of Title 18 of the United States Code
32.2 Certification of Chief Financial Officer pursuant to pursuant to Section 1350 of Title 18 of the United States Code

Notes:
  (1) Filed as an exhibit to our Registration Statement on Form 10 filed with the SEC on November 17, 2014.
  (2) Filed as an exhibit to our Registration Statement on Form 10/A filed with the SEC on December 24, 2014.
  (3) Filed as an exhibit to our Current Report on Form 8-K filed with the SEC on March 11, 2015.
  (4) Filed as an exhibit to our Current Report on Form 8-K filed with the SEC on December 7, 2015.
  (5) Filed as an exhibit to our Form 10-Q filed with the SEC on September 14, 2016.

SIGNATURES

In accordance with Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

      I-MINERALS INC.
       
       
       
Date: March 15, 2017 By: /s/ Thomas M. Conway
      THOMAS M. CONWAY
      Chief Executive Officer and President
      (Principal Executive Officer)
       
       
Date: March 15, 2017 By: /s/ Matthew Anderson
      MATTHEW ANDERSON
      Chief Financial Officer
      (Principal Financial Officer and Principal Accounting Officer)


EX-31.1 2 exhibit31-1.htm CERTIFICATION Filed by Avantafile.com - I-Minerals Inc. - Exhibit 31.1

Exhibit 31.1

CERTIFICATION

I, Thomas M. Conway, certify that:

1. I have reviewed this quarterly report on Form 10-Q of I-Minerals Inc.;

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 and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) 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) 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

  (c) 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 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 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.

Date: March 15, 2017

  /s/ Thomas M. Conway
THOMAS M. CONWAY
Chief Executive Officer and President


EX-31.2 3 exhibit31-2.htm CERTIFICATION Filed by Avantafile.com - I-Minerals Inc. - Exhibit 31.2

Exhibit 31.2

CERTIFICATION

I, Matthew Anderson, certify that:

1. I have reviewed this quarterly report on Form 10-Q of I-Minerals Inc.;

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 and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) 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) 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

  (c) 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 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 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.

Date: March 15, 2017

  /s/ Matthew Anderson
MATTHEW ANDERSON
Chief Financial Officer


EX-32.1 4 exhibit32-1.htm CERTIFICATION Filed by Avantafile.com - I-Minerals Inc. - Exhibit 32.1

Exhibit 32.1

CERTIFICATION BY CHIEF EXECUTIVE OFFICER
PURSUANT TO 18 U.S.C. SECTION 1350,
AS ADOPTED PURSUANT TO
SECTION 906 OF THE SARBANESOXLEY ACT OF 2002

In connection with the Quarterly Report of I-Minerals Inc. (the “Company”) on Form 10-Q for the period ended January 31, 2017 as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, Thomas M. Conway, Chief Executive Officer and President of the Company, certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that:

  1. The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

  2. The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

Date: March 15, 2017

  /s/ Thomas M. Conway
THOMAS M. CONWAY
Chief Executive Officer and President


EX-32.2 5 exhibit32-2.htm CERTIFICATION Filed by Avantafile.com - I-Minerals Inc. - Exhibit 32.2

Exhibit 32.2

CERTIFICATION BY CHIEF EXECUTIVE OFFICER
PURSUANT TO 18 U.S.C. SECTION 1350,
AS ADOPTED PURSUANT TO
SECTION 906 OF THE SARBANESOXLEY ACT OF 2002

In connection with the Quarterly Report of I-Minerals Inc. (the “Company”) on Form 10-Q for the period ended January 31, 2017 as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, Matthew Anderson, Chief Financial Officer of the Company, certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that:

  1. The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

  2. The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

Date: March 15, 2017

  /s/ Matthew Anderson
MATTHEW ANDERSON
Chief Financial Officer


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At January 31, 2017, the Company had not yet achieved profitable operations, had an accumulated deficit of $</font>35,082,350 <font style="letter-spacing: -0.1pt">since inception and expects to incur further losses in the development of its business, all of which casts substantial doubt upon the Company&#8217;s ability to continue as a going concern and, therefore, that it may be unable to realize its assets and discharge its liabilities in the normal course of business. </font></p> <p style="font: 10pt Arial, Helvetica, Sans-Serif; margin: 1pt 0 0 0.25in; text-align: justify">&#160;</p> <p style="font: 10pt Arial, Helvetica, Sans-Serif; margin: 1pt 0 0 0.25in; text-align: justify"><font style="letter-spacing: -0.1pt">The Company&#8217;s ability to continue as a going concern is dependent upon its ability to obtain the necessary financing to develop the Property and to meet its obligations and repay its liabilities arising from normal business operations when they come due. 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Disclosure - SHARE CAPITAL (Detail) - Summary Of Stock Options Outstanding link:presentationLink link:calculationLink link:definitionLink 00000032 - Disclosure - SHARE CAPITAL (Detail) - Fair Values of Non-Employee Stock Options link:presentationLink link:calculationLink link:definitionLink 00000033 - Disclosure - SHARE CAPITAL (Detail) - Weighted Average Assumptions of Non-Employee Stock Options link:presentationLink link:calculationLink link:definitionLink 00000034 - Disclosure - SHARE CAPITAL (Detail) - Income Statement Share-based payments link:presentationLink link:calculationLink link:definitionLink 00000035 - Disclosure - SHARE CAPITAL (Detail) - Summary Of Fully-Exercisable Share Purchase Warrants link:presentationLink link:calculationLink link:definitionLink 00000036 - Disclosure - SHARE CAPITAL (Detail) - Summary Of Warrants Outstanding And Issuable link:presentationLink link:calculationLink link:definitionLink 00000037 - Disclosure - NATURE OF BUSINESS AND BASIS OF PRESENTATION AND LIQUIDITY (Details Narrative) link:presentationLink link:calculationLink link:definitionLink 00000038 - 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Disclosure - SUBSEQUENT EVENTS (Details Narrative) link:presentationLink link:calculationLink link:definitionLink EX-101.CAL 9 imav-20170131_cal.xml CALCULATION LINKBASE DOCUMENT EX-101.DEF 10 imav-20170131_def.xml DEFINITION LINKBASE DOCUMENT EX-101.LAB 11 imav-20170131_lab.xml LABELS LINKBASE DOCUMENT Equity Components [Axis] Common Stock Commitment to Issue Shares Additional Paid-In Capital Accumulated Deficit Liability Class [Axis] Warrants [Member] Non-employee Options [Member] Long-term Debt, Type [Axis] Promissory Notes [Member] Award Type [Axis] Set 1 [Member] Set 2 [Member] Set 3 [Member] Set 4 [Member] Set 5 [Member] Set 6 [Member] Set 7 [Member] Set 8 [Member] Set 9 [Member] Related Party [Axis] RJG Capital Corporation [Member] Wayne Moorhouse, Director [Member] Malaspina Consultants Inc. [Member Directors Or Officers Or Companies Controlled By Them [Member] Debt Conversion Description [Axis] Second Promissory Notes [Member] Class of Warrant or Right [Axis] Warrants 1 [Member] Warrants 2 [Member] Warrants 3 [Member] Warrants 4 [Member] Warrants 5 [Member] Warrants 6 [Member] Warrants 7 [Member] Warrants 8 [Member] Warrants 9 [Member] Warrants 10 [Member] Warrants 11 [Member] Warrants 12 [Member] Warrants 13 [Member] Warrants 14 [Member] Warrants 15 [Member] Debt Instrument [Axis] First Promissory Notes [Member] Company Controlled By A Director Of The Company [Member] Set 10 [Member] Set 11 [Member] Third Promissory Notes [Member] Report Date [Axis] June 14, 2016 [Member] Promissory Notes Interest [Member] Second Promissory Notes Interest [Member] Set 12 [Member] Bonus Shares [Member] September 23, 2016 [Member] April 30 Commitment [Member] John Theobald, Director [Member] Set 13 [Member] December 1, 2016 [Member] January 25, 2017 [Member] Subsequent Event Type [Axis] Loan Agreement [Member] Document And Entity Information Entity Registrant Name Entity Central Index Key Document Type Document Period End Date Amendment Flag Current Fiscal Year End Date Is Entity a Well-known Seasoned Issuer? Is Entity a Voluntary Filer? Is Entity's Reporting Status Current? Entity Filer Category Entity Public Float Entity Common Stock, Shares Outstanding Document Fiscal Period Focus Document Fiscal Year Focus Statement of Financial Position [Abstract] ASSETS Current assets Cash Receivables Prepaids [us-gaap:AssetsCurrent] Equipment Mineral property interest Deposits TOTAL ASSETS LIABILITIES Current liabilities Accounts payable and accrued liabilities Promissory notes Derivative liabilities Promissory notes [us-gaap:LiabilitiesCurrent] Promissory notes TOTAL LIABILITIES CAPITAL DEFICIT Unlimited common shares with no par value Issued and fully paid: 89,331,598 (April 30, 2016 - 86,328,952) Additional paid-in capital Commitment to issue shares Deficit TOTAL CAPITAL DEFICIT TOTAL LIABILITIES AND CAPITAL DEFICIT Common Stock, par value Common Stock, shares authorized Common Stock, shares issued Common Stock, shares outstanding Income Statement [Abstract] OPERATING EXPENSES Amortization Management and consulting fees Mineral property expenditures General and miscellaneous Professional fees [us-gaap:OperatingExpenses] OTHER (EXPENSES) INCOME Foreign exchange (loss) gain Loss on settlement of liabilities Accretion expense Interest expense Change in fair value of derivative liabilities LOSS FOR THE PERIOD Loss per share - basic and diluted Weighted average number of shares outstanding Statement of Cash Flows [Abstract] OPERATING ACTIVITIES Loss for the period Items not involving cash: Amortization Stock-based compensation Loss on settlement of liabilities Accretion expense Change in fair value of derivative liabilities Change in non-cash operating working capital items: Receivables Prepaids Accounts payable and accrued liabilities Cash flows used in operating activities FINANCING ACTIVITIES Proceeds from exercise of stock options and warrants Promissory notes received Cash flows from financing activities INCREASE (DECREASE) IN CASH CASH, BEGINNING OF THE PERIOD CASH, END OF THE PERIOD SUPPLEMENTAL CASH FLOW INFORMATION Interest paid Taxes paid Statement [Table] Statement [Line Items] Beginning Balance Balance (in Shares) Shares issued on exercise of options Shares issued on exercise of options (Shares) Shares issued on exercise of warrants Shares issued on exercise of warrants (Shares) Shares issued as a debt discount Shares issued as a debt discount (Shares) Shares issuable as a debt discount Share-based payments - vesting Reallocation on exercise of options Reallocation on exercise of warrants Ending Balance Balance (in Shares) Accounting Policies [Abstract] NATURE OF BUSINESS AND BASIS OF PRESENTATION AND LIQUIDITY SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Extractive Industries [Abstract] MINERAL PROPERTY INTEREST Payables and Accruals [Abstract] ACCOUNTS PAYABLE AND ACCRUED LIABILITIES Debt Disclosure [Abstract] PROMISSORY NOTES Disclosure of Compensation Related Costs, Share-based Payments [Abstract] WARRANT LIABILITIES SHARE CAPITAL Related Party Transactions [Abstract] RELATED PARTY TRANSACTIONS Segment Reporting [Abstract] SEGMENT DISCLOSURES Supplemental Cash Flow Elements [Abstract] NON-CASH TRANSACTIONS Subsequent Events [Abstract] SUBSEQUENT EVENTS Financial Instruments and Fair Value Measures Earnings (Loss) Per Share Summary of Liabilities Schedule of Accounts Payable And Accrued Liabilities Schedule of Promissory Notes Schedule of Payments To Repay Principal Balance Schedule of Fair Value of Derivative Liabilities Schedule of Weighted Average Assumptions of Derivative Liabilities Stock Options Outstanding Summary Of Stock Options Outstanding Fair Values of Non-Employee Stock Options Weighted Average Assumptions of Non-Employee Stock Options Income Statement Share-based payments Summary Of Fully-Exercisable Share Purchase Warrants Summary Of Warrants Outstanding And Issuable Beginning fair value Issuance Granted Vesting Reallocation on exercises of warrants Change in fair value Ending fair value Total Level 3 liabilities Trade payables Amounts due to related parties Interest payable on promissory notes Total accounts payable and accrued liabilities Promissory notes Second promissory notes Third promissory notes Total promissory notes 2017 2018 2019 2020 2021 Total Balance, April 30, 2016 Bonus warrants issuable pursuant to Promissory Notes Change in fair value of warrant derivatives Balance, January 31, 2017 Stock price (CAD$) Exercise price (CAD$) Risk-free interest rate (%) Expected life (years) Expected volatility (%) Expected dividends ($) Outstanding, Beginning Outstanding, Weighted Average Exercise Price, Beginning Granted Exercised Expired Forfeited Granted, Weighted Average Exercise Price Exercised, Weighted Average Exercise Price Expired, Weighted Average Exercise Price Forfeited, Weighted Average Exercise Price Outstanding, Weighted Average Exercise Price Outstanding, End Exercisable, Weighted Average Exercise Price Exercisable, End Type of Security Outstanding Stock Options Exercise Price Expiry Date Remaining Contractual Life (years) Fair value of non-employee options, beginning of the period Fair value of options on vesting Change in fair value of non-employee stock options during the period Fair value of non-employee options, end of the period Share Based Payments, Management and consulting fees Total Number Outstanding, Beginning Weighted Average Exercise Price Issued Issued, Weighted Average Exercise Price Expired Expired, Weighted Average Exercise Price Exercised Number Outstanding, End Weighted Average Exercise Price, End Accumulated Deficit Notes Fair Value Shares Excluded from Loss Per Share, potentially dilutive Concentration of Interest Production Royalty Promissory Notes Description Promissory Notes Advance Interest Rate Interest Recorded Promissory Note Interest Payable Terms Interest Payable Settled Shares Issued, Shares Shares Issued, Fair Value Accretion Expense Unamortized Debt Discount Warrant Derivative Liabilities Fair Value Shares Issued, per Share Stock Options Available For Grant Intrinsic Value Of Options Exercised Intrinsic Value Of Options Exercised, per Share Weighted Average Grant Date Fair Value Of Stock Options Unamortized Compensation Cost of Options Non Vested Stock Options, Shares Non Vested Stock Options Intrinsic Value Management And Consulting Fees Number of Operating Segments Warrants, Shares Warrants, Fair Value Event Date Event Description Assets, Current Assets ConvertibleNotesPayableCurrent2 Liabilities, Current PromissoryNotes Liabilities Stockholders' Equity Attributable to Parent Liabilities and Equity Payments to Acquire Oil and Gas Property Operating Expenses Net Income (Loss) Attributable to Parent Depreciation, Depletion and Amortization Increase (Decrease) in Accounts Receivable Increase (Decrease) in Prepaid Expense Increase (Decrease) in Accounts Payable and Accrued Liabilities Net Cash Provided by (Used in) Operating Activities Net Cash Provided by (Used in) Financing Activities Fair Value, Measurement with Unobservable Inputs Reconciliations, Recurring Basis, Liability Value Convertible Notes Payable, Noncurrent Deferred Compensation Share-based Arrangements, Liability, Current Share Price Share-based Compensation Arrangement by Share-based Payment Award, Options, Exercisable, Weighted Average Exercise Price Share-based Compensation Arrangement by Share-based Payment Award, Options, Grants in Period, Gross Share-based Compensation Arrangement by Share-based Payment Award, Options, Expirations in Period Share-based Compensation Arrangement by Share-based Payment Award, Options, Vested and Expected to Vest, Outstanding, Number Share-based Compensation Arrangement by Share-based Payment Award, Fair Value Assumptions, Exercise Price Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding, Intrinsic Value Share-based Compensation Arrangement by Share-based Payment Award, Options, Vested and Expected to Vest, Exercisable, Aggregate Intrinsic Value Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost Share-based Compensation Arrangement by Share-based Payment Award, Number of Shares Authorized Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range, Exercisable Options, Weighted Average Exercise Price Share-based Compensation Arrangement by Share-based Payment Award, Non-Option Equity Instruments, Expirations Share-based Compensation Arrangement by Share-based Payment Award, Options, Forfeitures and Expirations in Period, Weighted Average Exercise Price Share-based Compensation Arrangement by Share-based Payment Award, Non-Option Equity Instruments, Exercised EX-101.PRE 12 imav-20170131_pre.xml PRESENTATION LINKBASE DOCUMENT XML 13 R1.htm IDEA: XBRL DOCUMENT v3.6.0.2
Document and Entity Information - shares
9 Months Ended
Jan. 31, 2017
Mar. 15, 2017
Document And Entity Information    
Entity Registrant Name I-Minerals Inc  
Entity Central Index Key 0001405663  
Document Type 10-Q  
Document Period End Date Jan. 31, 2017  
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? Yes  
Entity Filer Category Smaller Reporting Company  
Entity Common Stock, Shares Outstanding   89,331,598
Document Fiscal Period Focus Q3  
Document Fiscal Year Focus 2016  
XML 14 R2.htm IDEA: XBRL DOCUMENT v3.6.0.2
Condensed Consolidated Balance Sheets (Unaudited) - USD ($)
Jan. 31, 2017
Apr. 30, 2016
Current assets    
Cash $ 408,475 $ 128,353
Receivables 6,067 21,747
Prepaids 22,448 45,498
[us-gaap:AssetsCurrent] 436,990 195,598
Equipment 6,319 7,985
Mineral property interest 305,850 305,850
Deposits 14,932 14,932
TOTAL ASSETS 764,091 524,365
Current liabilities    
Accounts payable and accrued liabilities 644,716 1,023,137
Promissory notes 6,587,526
Derivative liabilities 966,683 515,802
Promissory notes 13,666,801
[us-gaap:LiabilitiesCurrent] 15,278,200 8,126,465
Promissory notes 3,871,395
TOTAL LIABILITIES 15,278,200 11,997,860
CAPITAL DEFICIT    
Unlimited common shares with no par value Issued and fully paid: 89,331,598 (April 30, 2016 - 86,328,952) 18,644,105 17,963,265
Additional paid-in capital 1,924,136 1,839,639
Commitment to issue shares 81,112
Deficit (35,082,350) (31,357,511)
TOTAL CAPITAL DEFICIT (14,514,109) (11,473,495)
TOTAL LIABILITIES AND CAPITAL DEFICIT $ 764,091 $ 524,365
XML 15 R3.htm IDEA: XBRL DOCUMENT v3.6.0.2
Condensed Consolidated Balance Sheets (Parenthetical) - $ / shares
Jan. 31, 2017
Apr. 30, 2016
Statement of Financial Position [Abstract]    
Common Stock, par value
Common Stock, shares authorized
Common Stock, shares issued 89,331,598 86,328,952
Common Stock, shares outstanding 89,331,598 86,328,952
XML 16 R4.htm IDEA: XBRL DOCUMENT v3.6.0.2
Condensed Consolidated Statements of Loss (Unaudited) - USD ($)
3 Months Ended 9 Months Ended
Jan. 31, 2017
Jan. 31, 2016
Jan. 31, 2017
Jan. 31, 2016
OPERATING EXPENSES        
Amortization $ 513 $ 922 $ 1,666 $ 2,997
Management and consulting fees 58,221 53,145 247,047 150,346
Mineral property expenditures 387,812 848,075 1,055,024 2,382,611
General and miscellaneous 163,224 120,214 523,486 412,267
Professional fees (377,824) 36,028 (133,157) 309,150
[us-gaap:OperatingExpenses] (231,946) (1,058,384) (1,694,066) (3,257,371)
OTHER (EXPENSES) INCOME        
Foreign exchange (loss) gain 10,975 (646) (3,236) (361)
Loss on settlement of liabilities (31,512)
Accretion expense (120,031) (98,711) (363,386) (261,743)
Interest expense (416,623) (306,882) (1,159,725) (843,229)
Change in fair value of derivative liabilities (397,621) 502,358 (504,426) 659,687
LOSS FOR THE PERIOD $ (1,155,246) $ (962,265) $ (3,724,839) $ (3,734,529)
Loss per share - basic and diluted $ (0.01) $ (0.01) $ (0.04) $ (0.05)
Weighted average number of shares outstanding 88,611,697 84,367,010 87,650,365 82,311,551
XML 17 R5.htm IDEA: XBRL DOCUMENT v3.6.0.2
Condensed Consolidated Statements of Cash Flows (Unaudited) - USD ($)
9 Months Ended
Jan. 31, 2017
Jan. 31, 2016
OPERATING ACTIVITIES    
Loss for the period $ (3,724,839) $ (3,734,529)
Items not involving cash:    
Amortization 1,666 2,997
Stock-based compensation 155,223 34,900
Loss on settlement of liabilities 31,512
Accretion expense 363,386 261,743
Change in fair value of derivative liabilities 504,426 (659,687)
Change in non-cash operating working capital items:    
Receivables 15,680 (4,207)
Prepaids 23,050 111,793
Accounts payable and accrued liabilities 1,020,956 845,926
Cash flows used in operating activities (1,640,452) (3,109,552)
FINANCING ACTIVITIES    
Proceeds from exercise of stock options and warrants 300,574 4,449
Promissory notes received 1,620,000 3,040,000
Cash flows from financing activities 1,920,574 3,044,449
INCREASE (DECREASE) IN CASH 280,122 (65,103)
CASH, BEGINNING OF THE PERIOD 128,353 272,040
CASH, END OF THE PERIOD 408,475 206,937
SUPPLEMENTAL CASH FLOW INFORMATION    
Interest paid
Taxes paid
XML 18 R6.htm IDEA: XBRL DOCUMENT v3.6.0.2
Condensed Consolidated Statements of Capital Deficit (Unaudited) - USD ($)
9 Months Ended 12 Months Ended
Jan. 31, 2017
Apr. 30, 2016
Common Stock    
Beginning Balance $ 17,963,265  
Balance (in Shares) 86,328,952  
Shares issued on exercise of options $ 167,736  
Shares issued on exercise of options (Shares) 980,000  
Shares issued on exercise of warrants $ 132,838  
Shares issued on exercise of warrants (Shares) 1,170,084  
Shares issued as a debt discount $ 200,756  
Shares issued as a debt discount (Shares) 852,562  
Shares issuable as a debt discount  
Share-based payments - vesting  
Reallocation on exercise of options 70,726  
Reallocation on exercise of warrants 108,784  
Ending Balance $ 18,644,105 $ 17,963,265
Balance (in Shares) 89,331,598 86,328,952
Commitment to Issue Shares    
Beginning Balance $ 81,112  
Shares issued on exercise of options  
Shares issued on exercise of warrants  
Shares issued as a debt discount  
Shares issuable as a debt discount (81,112)  
Share-based payments - vesting  
Reallocation on exercise of options  
Reallocation on exercise of warrants  
Ending Balance $ 81,112
Additional Paid-In Capital    
Beginning Balance 1,839,639  
Shares issued on exercise of options  
Shares issued on exercise of warrants  
Shares issued as a debt discount  
Shares issuable as a debt discount  
Share-based payments - vesting 155,223  
Reallocation on exercise of options (70,726)  
Reallocation on exercise of warrants  
Ending Balance 1,924,136 1,839,639
Accumulated Deficit    
Beginning Balance (31,357,511)  
Shares issued on exercise of options  
Shares issued on exercise of warrants  
Shares issued as a debt discount  
Shares issuable as a debt discount  
Share-based payments - vesting  
Reallocation on exercise of options  
Reallocation on exercise of warrants  
Loss for the period (3,724,839)  
Ending Balance (35,082,350) $ (31,357,511)
Beginning Balance $ (11,473,495)  
Balance (in Shares) 86,328,952  
Shares issued on exercise of options $ 167,736  
Shares issued on exercise of warrants 132,838  
Shares issued on exercise of warrants (Shares)   (980,000)
Shares issued as a debt discount 200,756  
Shares issuable as a debt discount  
Share-based payments - vesting  
Reallocation on exercise of options  
Reallocation on exercise of warrants (108,784)  
Loss for the period (3,724,839)  
Ending Balance $ (14,514,109) $ (11,473,495)
Balance (in Shares) 89,331,598 86,328,952
XML 19 R7.htm IDEA: XBRL DOCUMENT v3.6.0.2
NATURE OF BUSINESS AND BASIS OF PRESENTATION AND LIQUIDITY
9 Months Ended
Jan. 31, 2017
Accounting Policies [Abstract]  
NATURE OF BUSINESS AND BASIS OF PRESENTATION AND LIQUIDITY
1.NATURE OF BUSINESS AND BASIS OF PRESENTATION AND LIQUIDITY:

 

I-Minerals Inc. (the “Company”) was incorporated under the laws of British Columbia, Canada, in 1984. The Company is listed for trading on the TSX Venture Exchange under the symbol “IMA” and the OTCQX marketplace under the symbol “IMAHF”.

 

The Company’s principal business is the development of the Helmer-Bovill industrial mineral property (“the Property”) located in Latah County, Idaho. The Helmer-Bovill property is comprised of eleven mineral leases that host potentially economic deposits of feldspar, quartz and kaolinitic clays, primarily kaolinite and halloysite.

 

Basis of Presentation and Liquidity

 

The accompanying unaudited condensed consolidated financial statements have been prepared by the Company in accordance with accounting principles generally accepted in the United States of America (“US GAAP”) for interim financial information as well as Article 10 of Regulation S-X on the basis that the Company will continue as a going concern, which assumes that the Company will be able to meet its obligations and continue its operations for the next year. Realization values may be substantially different from carrying values as shown and these financial statements do not give effect to adjustments that would be necessary to the carrying values and classification of assets and liabilities should the Company be unable to continue as a going concern. At January 31, 2017, the Company had not yet achieved profitable operations, had an accumulated deficit of $35,082,350 since inception and expects to incur further losses in the development of its business, all of which casts substantial doubt upon the Company’s ability to continue as a going concern and, therefore, that it may be unable to realize its assets and discharge its liabilities in the normal course of business.

 

The Company’s ability to continue as a going concern is dependent upon its ability to obtain the necessary financing to develop the Property and to meet its obligations and repay its liabilities arising from normal business operations when they come due. Although the Company has been successful in the past in obtaining financing, there is no assurance that it will be able to obtain adequate financing in the future or that such financing will be on terms advantageous to the Company. The Company is currently receiving funds from a company controlled by a director of the Company through promissory notes (Notes 5 and 11). Management has no formal plan in place to address this concern but considers that the Company will be able to obtain additional funds by equity financing and/or promissory notes; however there is no assurance of additional funding being available. The Company has historically satisfied its capital needs primarily by issuing equity securities and/or promissory notes. Management plans to continue to provide for its capital needs by issuing equity securities and/or promissory notes.

 

The financial statements do not include all of the information and footnotes required by accounting principles generally accepted in the United States of America for complete financial statements. In the opinion of our management, all adjustments (consisting of only normal recurring accruals) considered necessary for a fair presentation of the interim financial statements have been included. Operating results for the nine months ended January 31, 2017 are not necessarily indicative of the results that may be expected for the full year ending April 30, 2017. All amounts presented are in US dollars except where otherwise indicated. For further information refer to the financial statements and footnotes thereto for the year ended April 30, 2016 included in the Company’s Annual Report on Form 10-K filed on July 27, 2016.

XML 20 R8.htm IDEA: XBRL DOCUMENT v3.6.0.2
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
9 Months Ended
Jan. 31, 2017
Accounting Policies [Abstract]  
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
2.SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES:

 

Financial Instruments and Fair Value Measures

 

The book value of cash, accounts receivable, accounts payable and accrued liabilities approximate their fair values due to the immediate or short-term maturity of those instruments. The fair value hierarchy under US GAAP is based on three levels of inputs, of which the first two are considered observable and the last unobservable, that may be used to measure fair value which are the following:

 

 

Level 1 - quoted prices (unadjusted) in active markets for identical assets or liabilities;

 

Level 2 - observable inputs other than Level I, quoted prices for similar assets or liabilities in active prices whose inputs are observable or whose significant value drivers are observable; and

 

Level 3 - assets and liabilities whose significant value drivers are unobservable by little or no market activity and that are significant to the fair value of the assets or liabilities.

 

The Company’s Promissory Notes are based on Level 2 inputs in the ASC 820 fair value hierarchy. The Company calculated the fair value of these instruments by discounting future cash flows using rates representative of current borrowing rates. At January 31, 2017, the Promissory Notes had a fair value of $13,616,576 (April 30, 2016 – $10,703,836).

 

The Company had certain Level 3 liabilities required to be recorded at fair value on a recurring basis in accordance with US GAAP as at January 31, 2017 and April 30, 2016. As at January 31, 2017, the Company’s Level 3 liabilities consisted of the warrants issued in connection with the Company’s offering of equity units in a private placement and warrants issued as financing fees as well as the grant of share purchase options to non-employees.

 

The resulting Level 3 liabilities have no active market and are required to be measured at their fair value each reporting period based on information that is unobservable.

 

A summary of the Company’s Level 3 liabilities for the nine months ended January 31, 2017 and 2016 is as follows:

 

 

2017

$

2016

$

     
Warrants (Note 6)    
     
Beginning fair value 326,595 1,128,841
Issuance 55,239 151,318
Reallocation on exercises of warrants (108,784) -
Change in fair value 365,241 (631,185)
Ending fair value 638,291 648,974
     
Non-employee options (Note 7(c))    
     
Beginning fair value 189,207 116,615
Fair value of options on vesting - 42,933
Change in fair value 139,185 (28,502)
Ending fair value 328,392 131,046
     
Total Level 3 liabilities 966,683 780,020

 

Certain assets and liabilities are measured at fair value on a nonrecurring basis; that is, the instruments are not measured at fair value on an ongoing basis but are subject to fair value adjustments only in certain circumstances (for example, when there is evidence of impairment). There were no assets or liabilities measured at fair value on a nonrecurring basis during the periods ended January 31, 2017 and April 30, 2016.

 

Earnings (Loss) Per Share

 

The basic loss per common share is computed by dividing net loss available to common stockholders by the weighted average number of common shares outstanding. Diluted loss per common share is computed similar to basic loss per common share except that the denominator is increased to include the number of additional common shares that would have been outstanding if the potential common shares had been issued and if the additional common shares were dilutive. For the nine months ended January 31, 2017, loss per share excludes 9,226,082 (2016 – 30,414,438) potentially dilutive common shares (related to outstanding options and warrants as well as shares committed to be issued pursuant to the Promissory Notes) as their effect was anti-dilutive.

XML 21 R9.htm IDEA: XBRL DOCUMENT v3.6.0.2
MINERAL PROPERTY INTEREST
9 Months Ended
Jan. 31, 2017
Extractive Industries [Abstract]  
MINERAL PROPERTY INTEREST

3.       MINERAL PROPERTY INTEREST:

 

Helmer-Bovill Property – Latah County, Idaho

 

The Company has an undivided 100% interest in 11 State of Idaho mineral leases. The State of Idaho mineral leases are subject to a 5% production royalty on gross sales.

XML 22 R10.htm IDEA: XBRL DOCUMENT v3.6.0.2
ACCOUNTS PAYABLE AND ACCRUED LIABILITIES
9 Months Ended
Jan. 31, 2017
Payables and Accruals [Abstract]  
ACCOUNTS PAYABLE AND ACCRUED LIABILITIES

4.       ACCOUNTS PAYABLE AND ACCRUED LIABILITIES:

 

 

January 31, 2017

$

April 30, 2016

$

     
Trade payables 157,250 307,316
Amounts due to related parties (Note 8) 200,799 189,501
Interest payable on promissory notes 286,667 526,320
     
Total accounts payable and accrued liabilities 644,716 1,023,137
XML 23 R11.htm IDEA: XBRL DOCUMENT v3.6.0.2
PROMISSORY NOTES
9 Months Ended
Jan. 31, 2017
Debt Disclosure [Abstract]  
PROMISSORY NOTES
5.PROMISSORY NOTES:

 

 

January 31, 2017

$

April 30, 2016

$

     
First promissory notes - 5,678,107
Second promissory notes - 4,780,814
Third promissory notes 13,666,801 -
     
Total promissory notes 13,666,801 10,458,921

 

On September 13, 2013, January 27, 2014 and December 4, 2014, the Company entered into agreements with a company controlled by a director of the Company (the “Lender”) pursuant to which $5,787,280 was advanced to the Company in tranches (the “First Promissory Notes”). The First Promissory Notes were to mature as to $3,000,000 on December 2, 2016 and the balance due on December 31, 2016.

 

On February 18, 2015 and December 1, 2015, the Company entered into agreements with the Lender pursuant to which $5,457,000 was advanced to the Company in tranches (the “Second Promissory Notes”). The Second Promissory Notes mature were to mature as to $1,000,000 on December 2, 2016, $2,000,000 on June 2, 2017 and the balance due on December 2, 2017.

 

Effective August 31, 2016, the Company entered into an agreement (dated June 1, 2016) with the Lender pursuant to which up to an additional $2,965,000 will be advanced to the Company in tranches (the “Third Promissory Notes”). In addition, the First Promissory Notes and the Second Promissory Notes were amended and combined with the Third Promissory Notes with a modified maturity date of December 2, 2017. All other terms of the First Promissory Notes and the Second Promissory Notes remained unchanged.

 

In accordance with the guidance of ASC 470-50 and ASC 470-60, the Company determined that the June 1, 2016 agreement resulted in a debt modification, not a debt extinguishment or a troubled debt restructuring. The aggregate finance fees relating to the promissory notes are now being amortized to the Statement of Loss over the revised life of the promissory notes using the effective interest method.

During the nine months ended January 31, 2017, the Company received $1,420,000 in advances pursuant to the Third Promissory Notes and the final $200,000 in advances pursuant to the Second Promissory Notes.

 

The following table outlines the estimated cash payments required in order to repay the principal balance of the Third Promissory Notes:

2017

$

2018

$

2019

$

2020

$

2021

$

Total

$

- 14,063,657 - - - 14,063,657

 

Certain conditions may result in early repayment including immediate repayment in the event a person currently not related to the Company acquires more than 40% of the outstanding common shares of the Company. Debt issuance costs will be amortized over the estimated maturity life of the promissory notes.

 

The promissory notes bear interest at the rate of 12% per annum and during the nine months ended January 31, 2017, the Company recorded interest of $1,159,725 (2016 - $525,136). Interest is payable semi-annually as calculated on May 31st and November 30th of each year. Interest is to be paid either in cash, in common shares or deemed an advance of principal at the option of the Lender. As part of the Third Promissory Notes agreement dated June 1, 2016, interest payable of $640,130 was transferred to the promissory notes balance as a deemed advance. This balance transferred was not subject to bonus shares or bonus warrants. The $640,130 of interest was for the period from December 1, 2015 to May 31, 2016. The lender elected to have interest payable from June 1, 2016 to November 30, 2016 of $759,247 deemed an advance (not subject to bonus shares or bonus warrants).

 

The Company and the Lender agreed that the Lender is to receive bonus shares equal to 7.5% of each loan tranche advanced divided by the Company’s common share market price. In addition, the Company will issue the Lender an equal number of share purchase warrants for each loan tranche advanced. Each bonus share purchase warrant will entitle the Lender to purchase one common share of the Company at a price equal to the greater of (a) the market price of the Company’s common shares on the date of the advance and (b) the volume weighted average price of the Company’s common shares over the twenty trading days immediately prior to the date of the advance. The bonus share purchase warrants expire on the earlier of (a) December 31, 2018 and (b) the date the advance has been repaid in full, including interest.

 

During the nine months ended January 31, 2017, the Company issued 852,562 bonus shares to the Lender at the fair value of $200,756, based on their quoted market price at the date the advances were received, including 349,325 shares having a fair value of $81,112 that the Company had committed to issue as at April 30, 2016. At January 31, 2017, the Company was committed to issuing no additional bonus shares to the Lender. The fair value of the bonus shares was determined by reference to the trading price of the Company’s common shares on the date the advances were received.

 

The fair value of 534,480 bonus share purchase warrants committed to be issued (based on advances received during the period) during the nine months ended January 31, 2017 of $55,239 was estimated using the Black-Scholes option pricing model with the following weighted average assumptions: stock price – CAD$0.292; exercise price – CAD$0.299; expected risk-free interest rate – 1.15%; expected life – 2.40 years; expected volatility – 79% and expected dividend rate – 0%.

 

The aggregate finance fees (bonus shares and bonus warrants) are recorded against the promissory notes balance and are being amortized to the Statement of Loss over the life of the promissory notes using the effective interest method. The accretion expense in respect of the debt discount recorded on the issuance of bonus shares and warrants totalled $363,386 for the nine months ended January 31, 2017 (2016 - $142,702) The unamortized debt discount as at January 31, 2017 is $396,856 (April 30, 2016 $585,359).

 

The promissory notes are collateralized by the Company’s Helmer-Bovill Property.

 

XML 24 R12.htm IDEA: XBRL DOCUMENT v3.6.0.2
WARRANT LIABILITIES
9 Months Ended
Jan. 31, 2017
Disclosure of Compensation Related Costs, Share-based Payments [Abstract]  
WARRANT LIABILITIES

6.       WARRANT LIABILITIES:

 

The Company has share purchase warrants exercisable into common shares at an exercise price denominated in Canadian dollars. As a variable amount of US dollars are exercisable into a fixed number of common shares, the share purchase warrants are classified as derivative liabilities.

 

The Company records the fair value of the share purchase warrants in accordance with ASC 815, “Derivatives and Hedging”. The Company uses the Black-Scholes option pricing model to calculate the fair values of the derivative liabilities. The fair value of the derivative liability is revalued on each balance sheet date with corresponding gains and losses recorded in the consolidated statement of loss.

 

  $
   
Balance, April 30, 2016 326,595
   
Bonus warrants issuable pursuant to promissory notes (Note 5) 55,239
Reallocation on exercise of warrants (108,784)
Change in fair value of warrant derivatives 365,241
   
Balance, January 31, 2017 638,291

 

Warrant Derivative Liabilities

 

At January 31, 2017, the Company determined the fair value of Warrant Derivative Liabilities to be $638,291 (April 30 2016 - $326,595) as estimated using the Black-Scholes option pricing model with the following weighted average assumptions:

 

 

January 31,

2017

April 30,

2016

     
Stock price (CAD$) 0.390 0.23
Exercise price (CAD$) 0.308 0.27
Risk-free interest rate (%) 1.15 0.96
Expected life (years) 1.95 1.41
Expected volatility (%) 80 76
Expected dividends ($) Nil Nil
XML 25 R13.htm IDEA: XBRL DOCUMENT v3.6.0.2
SHARE CAPITAL
9 Months Ended
Jan. 31, 2017
Disclosure of Compensation Related Costs, Share-based Payments [Abstract]  
SHARE CAPITAL
7.SHARE CAPITAL:

 

Common shares

 

a)Authorized:

 

Unlimited number of common shares, without par value.

 

b)Stock transactions:

 

During the nine months ended January 31, 2017, the Company completed the following stock transactions:

 

i)On June 14, 2016, the Company issued 980,000 common shares on the exercise of stock options with an exercise price of CAD$0.22 per common share resulting gross proceeds of CAD$215,600 ($167,736).

 

 

 

ii)On September 23, 2016, the Company issued 486,346 common shares with a fair value of $116,756 including 349,325 shares having a fair value of $81,112 which the Company had committed to issue at April 30, 2016. The common shares were issued as debt discounts pursuant to the Second Promissory Notes and the Third Promissory Notes (Note 5).

 

iii)On December 1, 2016, the Company issued 1,170,084 common shares on the exercise of share purchase warrants with exercise prices ranging from CAD$0.14 to CAD$0.185 for gross proceeds of $132,838.
iv)On January 25, 2017, the Company issued 366,216 common shares with a fair value of $84,000. The common shares were issued as debt discounts pursuant to the Third Promissory Notes (Note 5).

 

c)Stock options:

 

The Company has granted stock options under the terms of its Stock Option Plan (the “Plan”). The Plan provides that the directors of the Company may grant options to purchase common shares to directors, officers, employees and service providers of the Company on terms that the directors of the Company may determine are within the limitations set forth in the Plan. The maximum number of shares available under the Plan is limited to 10% of the issued common shares. The maximum term of stock options is ten years. All stock options vest on the date of grant, unless otherwise stated. As at January 31, 2017, the Company had 2,378,160 stock options available for grant pursuant to the Plan (April 30, 2016 - 2,797,895).

 

The Company’s stock options outstanding as at January 31, 2017 and April 30, 2016 and the changes for the years then ended are as follows:

  Number Outstanding

Weighted Average

Exercise Price

(in CAD$)

     
Balance outstanding at April 30, 2016 5,835,000 0.21
Granted 1,700,000 0.25
Exercised (980,000) 0.22
     
Balance outstanding at January 31, 2017 6,555,000 0.22
     
Balance exercisable at January 31, 2017 5,545,000 0.22

 

The intrinsic value of options exercised during the nine months ended January 31, 2017 was CAD$88,200 based on a stock price of CAD$0.31 on the date of exercise.

 

Summary of stock options outstanding at January 31, 2017:

Security Number Outstanding

Exercise Price

(CAD$)

Expiry Date Remaining Contractual Life (years)
         
Stock options 1,300,000 0.10 July 30, 2018 1.49
Stock options 260,000 0.15 July 30, 2018 1.49
Stock options 300,000 0.25 July 30, 2018 1.49
Stock options 200,000 0.25 November 19, 2018 1.80
Stock options 150,000 0.25 January 8, 2019 1.94
Stock options 300,000 0.25 May 23, 2019 2.31
Stock options 150,000 0.25 December 16, 2017 0.87
Stock options 1,975,000 0.25 January 29, 2020 2.99
Stock options 200,000 0.25 August 4, 2020 3.51
Stock options 1,000,000 0.25 February 25, 2018 1.07
Stock options 20,000 0.22 May 19, 2018 1.30
Stock options 300,000 0.30 July 21, 2021 4.47
Stock options 400,000 0.30 November 3, 2021 4.76

 

The weighted average grant date fair value of stock options granted during the nine months ended January 31, 2017 of CAD$0.123 was estimated using the Black-Scholes option pricing model with the following weighted average assumptions: stock price – CAD$0.25; exercise price – CAD$0.25; risk-free interest rate – 1.08%; expected life – 3.24 years; expected volatility – 85% and expected dividends - $nil. Expected volatility was determined by reference to the historical volatility of the Company’s common shares trading on the TSX Venture Exchange.

 

Non-Employee Stock Options

 

In accordance with the guidance of ASC 815-40-15, stock options awarded to non-employees that are fully vested and exercisable in Canadian dollars are required to be accounted for as derivative liabilities because they are considered not to be indexed to the Company’s stock due to their exercise price being denominated in a currency other than the Company’s functional currency. Stock options awarded to non-employees that are not vested are accounted for as equity awards until the terms associated with their vesting requirements have been met. As at January 31, 2017, there were 400,000 (April 30, 2016 - nil) non-employee stock option awards that had not yet vested.

 

The non-employee stock options are accounted for at their respective fair values and are summarized as follows for the nine months ended January 31, 2017 and 2016:

 

 

2017

$

2016

$

     
Fair value of non-employee options, beginning of the period 189,207 116,615
Fair value of options on vesting - 42,933
Change in fair value of non-employee stock options during the period 139,185 (28,502)
     
Fair value of non-employee options, end of the period 328,392 131,046

 

The Company determined the fair value of its non-employee stock options as at January 31, 2017 and April 30, 2016 using the Black-Scholes option pricing model with the following weighted average assumptions:

 

 

January 31,

2017

April 30,

2016

     
Stock price (CAD$) 0.39 0.23
Exercise price (CAD$) 0.23 0.23
Risk-free interest rate (%) 0.86 1.34
Expected life (years) 1.66 2.43
Expected volatility (%) 61 87
Expected dividends ($) Nil Nil

 

The non-employee options are required to be re-valued with the change in fair value of the liability recorded as a gain or loss on the change of fair value of derivative liability and included in other items in the Company’s Consolidated Statements of Loss at the end of each reporting period. The fair value of the options will continue to be classified as a liability until such time as they are exercised, expire or there is an amendment to the respective agreements that renders these financial instruments to be no longer classified as a liability.

 

As at January 31, 2017, the unamortized compensation cost of options is $105,809 and the intrinsic value of options expected to vest is $729,614 (CAD$949,400).

 

Share-based payments are classified in the Company’s Statement of Loss during the nine months ended January 31, 2017 and 2016 as follows:

 

 

2017

$

2016

$

     
Management and consulting fees 155,223 34,900
     
  155,223 34,900

 

d)Share purchase warrants:

 

A summary of fully-exercisable share purchase warrants as at January 31, 2017 and April 30, 2016 and the changes for the years then ended are as follows:

 

Number

Outstanding

Weighted Average

Exercise Price

(CAD$)

     
Balance at April 30, 2016 5,812,212 0.27
Issued 534,480 0.30
Exercised (1,170,084) 0.15
Expired (955,526) 0.26
     
Balance at January 31, 2017 4,221,082 0.31

 

Summary of warrants outstanding and issuable at January 31, 2017:

 

Security Number Outstanding

Exercise Price

($CAD)

Expiry Date
       
Warrants 730,848 0.22 December 31, 2018(1)
Warrants 242,545 0.23 December 31, 2018(1)
Warrants 194,344 0.24 December 31, 2018(1)
Warrants 37,203 0.245 December 31, 2018(1)
Warrants 393,058 0.255 December 31, 2018(1)
Warrants 192,206 0.259 December 31, 2018(1)
Warrants 126,843 0.265 December 31, 2018(1)
Warrants 198,750 0.272 December 31, 2018(1)
Warrants 95,781 0.291 December 31, 2018(1)
Warrants 49,294 0.294 December 31, 2018(1)
Warrants 100,373 0.295 December 31, 2018(1)
Warrants 101,095 0.298 December 31, 2018(1)
Warrants 150,246 0.310 December 31, 2018(1)
Warrants 58,496 0.335 December 31, 2018(1)
Warrants 1,500,000 0.40 January 31, 2019

 

Notes:
(1)The warrants are exercisable until the earlier of the date disclosed or the date that the promissory note advance, including interest, is repaid (Note 5).
XML 26 R14.htm IDEA: XBRL DOCUMENT v3.6.0.2
RELATED PARTY TRANSACTIONS
9 Months Ended
Jan. 31, 2017
Related Party Transactions [Abstract]  
RELATED PARTY TRANSACTIONS
8.RELATED PARTY TRANSACTIONS:

 

During the nine months ended January 31, 2017, management and consulting fees of $72,185 (2016 - $72,099) were charged by RJG Capital Corporation, a wholly-owned company of W. Barry Girling, Director. Wayne Moorhouse, Director, charged $2,179 (2016 - $2,293) in management and consulting fees. $20,096 (2016 - $17,776) was charged by Malaspina Consultants Inc. for the services of Matt Anderson, CFO, and are included in professional fees. John Theobald, Director, charged $36,542 (2016 - $nil) in mineral property expenditures.

 

Included in accounts payable and accrued liabilities are amounts owed to directors or officers or companies controlled by them. As at January 31, 2017, the amount was $200,799 (April 30, 2016 $189,501). All amounts are non-interest bearing, unsecured, and due on demand.

 

The promissory notes received from a company controlled by a director (Notes 5 and 11) are related party transactions.

XML 27 R15.htm IDEA: XBRL DOCUMENT v3.6.0.2
SEGMENT DISCLOSURES
9 Months Ended
Jan. 31, 2017
Segment Reporting [Abstract]  
SEGMENT DISCLOSURES

9.       SEGMENT DISCLOSURES:

 

The Company considers its business to comprise a single operating segment being the exploration of its resource property. Substantially all of the Company’s long-term assets and operations are located in Latah County, Idaho.

XML 28 R16.htm IDEA: XBRL DOCUMENT v3.6.0.2
NON-CASH TRANSACTIONS
9 Months Ended
Jan. 31, 2017
Supplemental Cash Flow Elements [Abstract]  
NON-CASH TRANSACTIONS
10.NON-CASH TRANSACTIONS:

 

Investing and financing activities that affect recognized assets or liabilities but that do not result in cash receipts or cash payments are excluded from the consolidated statements of cash flows. During the nine months ended January 31, 2017, the following transactions were excluded from the consolidated statement of cash flows:

 

a)The commitment to issue 534,480 common shares at the fair value of $119,644 and 534,480 warrants at the fair value of $55,239 pursuant to the promissory notes.

 

During the nine months ended January 31, 2016, the following transactions were excluded from the consolidated statement of cash flows:

 

a)The issuance by the Company of 3,825,822 common shares at the fair value of $708,883 as payment of interest on the Promissory Notes;

 

b)The issuance by the Company of 1,390,294 common shares at the fair value of $54,035 as payment of interest on the Second Promissory Notes; and,

 

c)The commitment to issue 1,223,843 common shares at the fair value of $293,623 and 1,223,843 warrants at the fair value of $151,318 pursuant to the Second Promissory Notes.
XML 29 R17.htm IDEA: XBRL DOCUMENT v3.6.0.2
SUBSEQUENT EVENTS
9 Months Ended
Jan. 31, 2017
Subsequent Events [Abstract]  
SUBSEQUENT EVENTS

11.       SUBSEQUENT EVENTS:

 

Subsequent to January 31, 2017:

 

a)The Company received an aggregate of $125,000 of Third Promissory Notes.

 

b)On March 13, 2017, the Company entered into a loan agreement with an arm’s-length lender pursuant to which up to CAD$250,000 may be advanced to the Company, subject to TSX Venture Exchange approval. The loan will bear interest at a rate of 12% per annum and is due on or before December 31, 2018. The Company and the lender agreed that the lender is to receive bonus shares equal to 7.5% of the loan divided by the Company’s common share market price. In addition, the Company will issue the Lender an equal number of share purchase warrants.
XML 30 R18.htm IDEA: XBRL DOCUMENT v3.6.0.2
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies)
9 Months Ended
Jan. 31, 2017
Accounting Policies [Abstract]  
Financial Instruments and Fair Value Measures

Financial Instruments and Fair Value Measures

 

The book value of cash, accounts receivable, accounts payable and accrued liabilities approximate their fair values due to the immediate or short-term maturity of those instruments. The fair value hierarchy under US GAAP is based on three levels of inputs, of which the first two are considered observable and the last unobservable, that may be used to measure fair value which are the following:

 

 

Level 1 - quoted prices (unadjusted) in active markets for identical assets or liabilities;

 

Level 2 - observable inputs other than Level I, quoted prices for similar assets or liabilities in active prices whose inputs are observable or whose significant value drivers are observable; and

 

Level 3 - assets and liabilities whose significant value drivers are unobservable by little or no market activity and that are significant to the fair value of the assets or liabilities.

 

The Company’s Promissory Notes are based on Level 2 inputs in the ASC 820 fair value hierarchy. The Company calculated the fair value of these instruments by discounting future cash flows using rates representative of current borrowing rates. At January 31, 2017, the Promissory Notes had a fair value of $13,616,576 (April 30, 2016 – $10,703,836).

 

The Company had certain Level 3 liabilities required to be recorded at fair value on a recurring basis in accordance with US GAAP as at January 31, 2017 and April 30, 2016. As at January 31, 2017, the Company’s Level 3 liabilities consisted of the warrants issued in connection with the Company’s offering of equity units in a private placement and warrants issued as financing fees as well as the grant of share purchase options to non-employees.

 

The resulting Level 3 liabilities have no active market and are required to be measured at their fair value each reporting period based on information that is unobservable.

 

A summary of the Company’s Level 3 liabilities for the nine months ended January 31, 2017 and 2016 is as follows:

 

 

2017

$

2016

$

     
Warrants (Note 6)    
     
Beginning fair value 326,595 1,128,841
Issuance 55,239 151,318
Reallocation on exercises of warrants (108,784) -
Change in fair value 365,241 (631,185)
Ending fair value 638,291 648,974
     
Non-employee options (Note 7(c))    
     
Beginning fair value 189,207 116,615
Fair value of options on vesting - 42,933
Change in fair value 139,185 (28,502)
Ending fair value 328,392 131,046
     
Total Level 3 liabilities 966,683 780,020

 

Certain assets and liabilities are measured at fair value on a nonrecurring basis; that is, the instruments are not measured at fair value on an ongoing basis but are subject to fair value adjustments only in certain circumstances (for example, when there is evidence of impairment). There were no assets or liabilities measured at fair value on a nonrecurring basis during the periods ended January 31, 2017 and April 30, 2016.

Earnings (Loss) Per Share

Earnings (Loss) Per Share

 

The basic loss per common share is computed by dividing net loss available to common stockholders by the weighted average number of common shares outstanding. Diluted loss per common share is computed similar to basic loss per common share except that the denominator is increased to include the number of additional common shares that would have been outstanding if the potential common shares had been issued and if the additional common shares were dilutive. For the nine months ended January 31, 2017, loss per share excludes 9,226,082 (2016 – 30,414,438) potentially dilutive common shares (related to outstanding options and warrants as well as shares committed to be issued pursuant to the Promissory Notes) as their effect was anti-dilutive.

 

XML 31 R19.htm IDEA: XBRL DOCUMENT v3.6.0.2
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Tables)
9 Months Ended
Jan. 31, 2017
Accounting Policies [Abstract]  
Summary of Liabilities
 

2017

$

2016

$

     
Warrants (Note 6)    
     
Beginning fair value 326,595 1,128,841
Issuance 55,239 151,318
Reallocation on exercises of warrants (108,784) -
Change in fair value 365,241 (631,185)
Ending fair value 638,291 648,974
     
Non-employee options (Note 7(c))    
     
Beginning fair value 189,207 116,615
Fair value of options on vesting - 42,933
Change in fair value 139,185 (28,502)
Ending fair value 328,392 131,046
     
Total Level 3 liabilities 966,683 780,020
XML 32 R20.htm IDEA: XBRL DOCUMENT v3.6.0.2
ACCOUNTS PAYABLE AND ACCRUED LIABILITIES (Tables)
9 Months Ended
Jan. 31, 2017
Payables and Accruals [Abstract]  
Schedule of Accounts Payable And Accrued Liabilities
 

January 31, 2017

$

April 30, 2016

$

     
Trade payables 157,250 307,316
Amounts due to related parties (Note 8) 200,799 189,501
Interest payable on promissory notes 286,667 526,320
     
Total accounts payable and accrued liabilities 644,716 1,023,137
XML 33 R21.htm IDEA: XBRL DOCUMENT v3.6.0.2
PROMISSORY NOTES (Tables)
9 Months Ended
Jan. 31, 2017
Debt Disclosure [Abstract]  
Schedule of Promissory Notes
 

January 31, 2017

$

April 30, 2016

$

     
First promissory notes - 5,678,107
Second promissory notes - 4,780,814
Third promissory notes 13,666,801 -
     
Total promissory notes 13,666,801 10,458,921
Schedule of Payments To Repay Principal Balance

2017

$

2018

$

2019

$

2020

$

2021

$

Total

$

- 14,063,657 - - - 14,063,657
XML 34 R22.htm IDEA: XBRL DOCUMENT v3.6.0.2
WARRANT LIABILITIES (Tables)
9 Months Ended
Jan. 31, 2017
Disclosure of Compensation Related Costs, Share-based Payments [Abstract]  
Schedule of Fair Value of Derivative Liabilities
  $
   
Balance, April 30, 2016 326,595
   
Bonus warrants issuable pursuant to promissory notes (Note 5) 55,239
Reallocation on exercise of warrants (108,784)
Change in fair value of warrant derivatives 365,241
   
Balance, January 31, 2017 638,291
Schedule of Weighted Average Assumptions of Derivative Liabilities
 

January 31,

2017

April 30,

2016

     
Stock price (CAD$) 0.390 0.23
Exercise price (CAD$) 0.308 0.27
Risk-free interest rate (%) 1.15 0.96
Expected life (years) 1.95 1.41
Expected volatility (%) 80 76
Expected dividends ($) Nil Nil
XML 35 R23.htm IDEA: XBRL DOCUMENT v3.6.0.2
SHARE CAPITAL (Tables)
9 Months Ended
Jan. 31, 2017
Disclosure of Compensation Related Costs, Share-based Payments [Abstract]  
Stock Options Outstanding
  Number Outstanding

Weighted Average

Exercise Price

(in CAD$)

     
Balance outstanding at April 30, 2016 5,835,000 0.21
Granted 1,700,000 0.25
Exercised (980,000) 0.22
     
Balance outstanding at January 31, 2017 6,555,000 0.22
     
Balance exercisable at January 31, 2017 5,545,000 0.22
Summary Of Stock Options Outstanding
Security Number Outstanding

Exercise Price

(CAD$)

Expiry Date Remaining Contractual Life (years)
         
Stock options 1,300,000 0.10 July 30, 2018 1.49
Stock options 260,000 0.15 July 30, 2018 1.49
Stock options 300,000 0.25 July 30, 2018 1.49
Stock options 200,000 0.25 November 19, 2018 1.80
Stock options 150,000 0.25 January 8, 2019 1.94
Stock options 300,000 0.25 May 23, 2019 2.31
Stock options 150,000 0.25 December 16, 2017 0.87
Stock options 1,975,000 0.25 January 29, 2020 2.99
Stock options 200,000 0.25 August 4, 2020 3.51
Stock options 1,000,000 0.25 February 25, 2018 1.07
Stock options 20,000 0.22 May 19, 2018 1.30
Stock options 300,000 0.30 July 21, 2021 4.47
Stock options 400,000 0.30 November 3, 2021 4.76
Fair Values of Non-Employee Stock Options
 

2017

$

2016

$

     
Fair value of non-employee options, beginning of the period 189,207 116,615
Fair value of options on vesting - 42,933
Change in fair value of non-employee stock options during the period 139,185 (28,502)
     
Fair value of non-employee options, end of the period 328,392 131,046
Weighted Average Assumptions of Non-Employee Stock Options
 

January 31,

2017

April 30,

2016

     
Stock price (CAD$) 0.39 0.23
Exercise price (CAD$) 0.23 0.23
Risk-free interest rate (%) 0.86 1.34
Expected life (years) 1.66 2.43
Expected volatility (%) 61 87
Expected dividends ($) Nil Nil
Income Statement Share-based payments
 

2017

$

2016

$

     
Management and consulting fees 155,223 34,900
     
  155,223 34,900
Summary Of Fully-Exercisable Share Purchase Warrants
 

Number

Outstanding

Weighted Average

Exercise Price

(CAD$)

     
Balance at April 30, 2016 5,812,212 0.27
Issued 534,480 0.30
Exercised (1,170,084) 0.15
Expired (955,526) 0.26
     
Balance at January 31, 2017 4,221,082 0.31
Summary Of Warrants Outstanding And Issuable
Security Number Outstanding

Exercise Price

($CAD)

Expiry Date
       
Warrants 730,848 0.22 December 31, 2018(1)
Warrants 242,545 0.23 December 31, 2018(1)
Warrants 194,344 0.24 December 31, 2018(1)
Warrants 37,203 0.245 December 31, 2018(1)
Warrants 393,058 0.255 December 31, 2018(1)
Warrants 192,206 0.259 December 31, 2018(1)
Warrants 126,843 0.265 December 31, 2018(1)
Warrants 198,750 0.272 December 31, 2018(1)
Warrants 95,781 0.291 December 31, 2018(1)
Warrants 49,294 0.294 December 31, 2018(1)
Warrants 100,373 0.295 December 31, 2018(1)
Warrants 101,095 0.298 December 31, 2018(1)
Warrants 150,246 0.310 December 31, 2018(1)
Warrants 58,496 0.335 December 31, 2018(1)
Warrants 1,500,000 0.40 January 31, 2019
XML 36 R24.htm IDEA: XBRL DOCUMENT v3.6.0.2
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Detail) - Summary of Liabilities - USD ($)
9 Months Ended
Jan. 31, 2017
Jan. 31, 2016
Warrants [Member]    
Beginning fair value $ 326,595 $ 1,128,841
Issuance 55,239 151,318
Reallocation on exercises of warrants (108,784)
Change in fair value 365,241 (631,185)
Ending fair value 638,291 648,974
Non-employee Options [Member]    
Beginning fair value 189,207 116,615
Vesting 42,933
Change in fair value 139,185 (28,502)
Ending fair value 328,392 131,046
Total Level 3 liabilities $ 966,683 $ 780,020
XML 37 R25.htm IDEA: XBRL DOCUMENT v3.6.0.2
ACCOUNTS PAYABLE AND ACCRUED LIABILITIES (Detail) - Schedule of Accounts Payable And Accrued Liabilities - USD ($)
Jan. 31, 2017
Apr. 30, 2016
Payables and Accruals [Abstract]    
Trade payables $ 157,250 $ 307,316
Amounts due to related parties 200,799 189,501
Interest payable on promissory notes 286,667 526,320
Total accounts payable and accrued liabilities $ 644,716 $ 1,023,137
XML 38 R26.htm IDEA: XBRL DOCUMENT v3.6.0.2
PROMISSORY NOTES (Detail) - Schedule of Promissory Notes - USD ($)
Jan. 31, 2017
Apr. 30, 2016
Debt Disclosure [Abstract]    
Promissory notes $ 5,678,107
Second promissory notes 4,780,814
Third promissory notes 13,666,801
Total promissory notes $ 13,666,801 $ 10,458,921
XML 39 R27.htm IDEA: XBRL DOCUMENT v3.6.0.2
PROMISSORY NOTES (Detail) - Schedule of Payments To Repay Principal Balance - Promissory Notes [Member]
Jan. 31, 2017
USD ($)
2017
2018 14,063,657
2019
2020
2021
Total $ 14,063,657
XML 40 R28.htm IDEA: XBRL DOCUMENT v3.6.0.2
WARRANT LIABILITIES (Detail) - Schedule of Fair Value of Derivative Liabilities
9 Months Ended
Jan. 31, 2017
USD ($)
Disclosure of Compensation Related Costs, Share-based Payments [Abstract]  
Balance, April 30, 2016 $ 326,595
Bonus warrants issuable pursuant to Promissory Notes 55,239
Reallocation on exercise of warrants (108,784)
Change in fair value of warrant derivatives 365,241
Balance, January 31, 2017 $ 638,291
XML 41 R29.htm IDEA: XBRL DOCUMENT v3.6.0.2
WARRANT LIABILITIES (Detail) - Schedule of Weighted Average Assumptions of Derivative Liabilities - Warrants [Member] - USD ($)
9 Months Ended 12 Months Ended
Jan. 31, 2017
Apr. 30, 2016
Stock price (CAD$) $ 0.39 $ 0.23
Exercise price (CAD$) $ 0.308 $ 0.27
Risk-free interest rate (%) 115.00% 96.00%
Expected life (years) 1 year 346 days 18 hours 1 year 149 days 15 hours 36 minutes
Expected volatility (%) 80.00% 76.00%
Expected dividends ($)
XML 42 R30.htm IDEA: XBRL DOCUMENT v3.6.0.2
SHARE CAPITAL (Detail) - Stock Options Outstanding - $ / shares
12 Months Ended
Apr. 30, 2016
Jan. 31, 2017
Disclosure of Compensation Related Costs, Share-based Payments [Abstract]    
Outstanding, Beginning 5,835,000 6,555,000
Outstanding, Weighted Average Exercise Price, Beginning $ 0.21 $ 0.22
Granted 1,700,000  
Exercised (980,000)  
Granted, Weighted Average Exercise Price $ 0.24  
Outstanding, Weighted Average Exercise Price $ 0.21 $ 0.22
Outstanding, End 5,835,000 6,555,000
Exercisable, Weighted Average Exercise Price   $ 0.22
Exercisable, End   5,545,000
XML 43 R31.htm IDEA: XBRL DOCUMENT v3.6.0.2
SHARE CAPITAL (Detail) - Summary Of Stock Options Outstanding
9 Months Ended
Jan. 31, 2017
$ / shares
shares
Set 1 [Member]  
Type of Security Stock options
Outstanding Stock Options | shares 1,300,000
Exercise Price | $ / shares $ 0.1
Expiry Date Jul. 30, 2018
Remaining Contractual Life (years) 1 year 178 days 20 hours 24 minutes
Set 2 [Member]  
Type of Security Stock options
Outstanding Stock Options | shares 260,000
Exercise Price | $ / shares $ 0.15
Expiry Date Jul. 30, 2018
Remaining Contractual Life (years) 1 year 178 days 20 hours 24 minutes
Set 3 [Member]  
Type of Security Stock options
Outstanding Stock Options | shares 300,000
Exercise Price | $ / shares $ 0.25
Expiry Date Jul. 30, 2018
Remaining Contractual Life (years) 1 year 178 days 20 hours 24 minutes
Set 4 [Member]  
Type of Security Stock options
Outstanding Stock Options | shares 200,000
Exercise Price | $ / shares $ 0.25
Expiry Date Nov. 19, 2018
Remaining Contractual Life (years) 1 year 292 days
Set 5 [Member]  
Type of Security Stock options
Outstanding Stock Options | shares 150,000
Exercise Price | $ / shares $ 0.25
Expiry Date Jan. 08, 2019
Remaining Contractual Life (years) 1 year 343 days 2 hours 24 minutes
Set 6 [Member]  
Type of Security Stock options
Outstanding Stock Options | shares 300,000
Exercise Price | $ / shares $ 0.25
Expiry Date May 23, 2019
Remaining Contractual Life (years) 2 years 113 days 3 hours 36 minutes
Set 7 [Member]  
Type of Security Stock options
Outstanding Stock Options | shares 150,000
Exercise Price | $ / shares $ 0.25
Expiry Date Dec. 16, 2017
Remaining Contractual Life (years) 317 days 13 hours 12 minutes
Set 8 [Member]  
Type of Security Stock options
Outstanding Stock Options | shares 1,975,000
Exercise Price | $ / shares $ 0.25
Expiry Date Jan. 29, 2020
Remaining Contractual Life (years) 2 years 361 days 8 hours 24 minutes
Set 9 [Member]  
Type of Security Stock options
Outstanding Stock Options | shares 200,000
Exercise Price | $ / shares $ 0.25
Expiry Date Aug. 04, 2020
Remaining Contractual Life (years) 3 years 186 days 3 hours 36 minutes
Set 10 [Member]  
Type of Security Stock options
Outstanding Stock Options | shares 1,000,000
Exercise Price | $ / shares $ 0.25
Expiry Date Feb. 25, 2018
Remaining Contractual Life (years) 1 year 25 days 13 hours 12 minutes
Set 11 [Member]  
Type of Security Stock options
Outstanding Stock Options | shares 20,000
Exercise Price | $ / shares $ 0.22
Expiry Date May 19, 2018
Remaining Contractual Life (years) 1 year 109 days 12 hours
Set 12 [Member]  
Type of Security Stock options
Outstanding Stock Options | shares 300,000
Exercise Price | $ / shares $ 0.3
Expiry Date Jul. 21, 2021
Remaining Contractual Life (years) 4 years 171 days 13 hours 12 minutes
Set 13 [Member]  
Type of Security Stock options
Outstanding Stock Options | shares 400,000
Exercise Price | $ / shares $ 0.3
Expiry Date Nov. 03, 2021
Remaining Contractual Life (years) 4 years 277 days 9 hours 36 minutes
XML 44 R32.htm IDEA: XBRL DOCUMENT v3.6.0.2
SHARE CAPITAL (Detail) - Fair Values of Non-Employee Stock Options - USD ($)
9 Months Ended
Jan. 31, 2017
Jan. 31, 2016
Disclosure of Compensation Related Costs, Share-based Payments [Abstract]    
Fair value of non-employee options, beginning of the period $ 189,207 $ 116,615
Fair value of options on vesting 42,933
Change in fair value of non-employee stock options during the period 139,185 (28,502)
Fair value of non-employee options, end of the period $ 328,392 $ 131,046
XML 45 R33.htm IDEA: XBRL DOCUMENT v3.6.0.2
SHARE CAPITAL (Detail) - Weighted Average Assumptions of Non-Employee Stock Options - Non-employee Options [Member] - USD ($)
9 Months Ended
Jan. 31, 2017
Jan. 31, 2016
Stock price (CAD$) $ 0.39 $ 0.23
Exercise price (CAD$) $ 0.23 $ 0.23
Risk-free interest rate (%) 86.00% 134.00%
Expected life (years) 1 year 240 days 21 hours 36 minutes 2 years 156 days 22 hours 48 minutes
Expected volatility (%) 61.00% 87.00%
Expected dividends ($)
XML 46 R34.htm IDEA: XBRL DOCUMENT v3.6.0.2
SHARE CAPITAL (Detail) - Income Statement Share-based payments - USD ($)
9 Months Ended
Jan. 31, 2017
Jan. 31, 2016
Disclosure of Compensation Related Costs, Share-based Payments [Abstract]    
Share Based Payments, Management and consulting fees $ 155,223 $ 34,900
Total $ 155,223 $ 34,900
XML 47 R35.htm IDEA: XBRL DOCUMENT v3.6.0.2
SHARE CAPITAL (Detail) - Summary Of Fully-Exercisable Share Purchase Warrants
9 Months Ended
Jan. 31, 2017
$ / shares
shares
Disclosure of Compensation Related Costs, Share-based Payments [Abstract]  
Number Outstanding, Beginning 5,812,212
Weighted Average Exercise Price | $ / shares $ 0.27
Issued 534,480
Issued, Weighted Average Exercise Price | $ / shares $ 0.30
Expired (955,526)
Exercised (1,170,084)
Number Outstanding, End 4,221,082
Weighted Average Exercise Price, End | $ / shares $ 0.31
XML 48 R36.htm IDEA: XBRL DOCUMENT v3.6.0.2
SHARE CAPITAL (Detail) - Summary Of Warrants Outstanding And Issuable
9 Months Ended
Jan. 31, 2017
$ / shares
shares
Warrants 1 [Member]  
Outstanding Stock Options | shares 730,848
Exercise Price | $ / shares $ 0.22
Expiry Date Dec. 31, 2018
Warrants 2 [Member]  
Outstanding Stock Options | shares 242,545
Exercise Price | $ / shares $ 0.23
Expiry Date Dec. 31, 2018
Warrants 3 [Member]  
Outstanding Stock Options | shares 194,344
Exercise Price | $ / shares $ 0.24
Expiry Date Dec. 31, 2018
Warrants 4 [Member]  
Outstanding Stock Options | shares 37,203
Exercise Price | $ / shares $ 0.245
Expiry Date Dec. 31, 2018
Warrants 5 [Member]  
Outstanding Stock Options | shares 393,058
Exercise Price | $ / shares $ 0.255
Expiry Date Dec. 31, 2018
Warrants 6 [Member]  
Outstanding Stock Options | shares 192,206
Exercise Price | $ / shares $ 0.259
Expiry Date Dec. 31, 2018
Warrants 7 [Member]  
Outstanding Stock Options | shares 126,843
Exercise Price | $ / shares $ 0.265
Expiry Date Dec. 31, 2018
Warrants 8 [Member]  
Outstanding Stock Options | shares 198,750
Exercise Price | $ / shares $ 0.272
Expiry Date Dec. 31, 2018
Warrants 9 [Member]  
Outstanding Stock Options | shares 95,781
Exercise Price | $ / shares $ 0.291
Expiry Date Dec. 31, 2018
Warrants 10 [Member]  
Outstanding Stock Options | shares 49,294
Exercise Price | $ / shares $ 0.294
Expiry Date Dec. 31, 2018
Warrants 11 [Member]  
Outstanding Stock Options | shares 100,373
Exercise Price | $ / shares $ 0.295
Expiry Date Dec. 31, 2018
Warrants 12 [Member]  
Outstanding Stock Options | shares 101,095
Exercise Price | $ / shares $ 0.298
Expiry Date Dec. 31, 2018
Warrants 13 [Member]  
Outstanding Stock Options | shares 150,246
Exercise Price | $ / shares $ 0.31
Expiry Date Dec. 31, 2018
Warrants 14 [Member]  
Outstanding Stock Options | shares 58,496
Exercise Price | $ / shares $ 0.335
Expiry Date Dec. 31, 2018
Warrants 15 [Member]  
Outstanding Stock Options | shares 1,500,000
Exercise Price | $ / shares $ 0.4
Expiry Date Jan. 31, 2019
XML 49 R37.htm IDEA: XBRL DOCUMENT v3.6.0.2
NATURE OF BUSINESS AND BASIS OF PRESENTATION AND LIQUIDITY (Details Narrative) - USD ($)
Jan. 31, 2017
Apr. 30, 2016
Accounting Policies [Abstract]    
Accumulated Deficit $ 35,082,350 $ 31,357,511
XML 50 R38.htm IDEA: XBRL DOCUMENT v3.6.0.2
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details Narrative) - USD ($)
9 Months Ended
Jan. 31, 2017
Jan. 31, 2016
Apr. 30, 2016
Shares Excluded from Loss Per Share, potentially dilutive 9,226,082 30,414,438  
Promissory Notes [Member]      
Notes Fair Value $ 13,616,576   $ 10,703,836
XML 51 R39.htm IDEA: XBRL DOCUMENT v3.6.0.2
MINERAL PROPERTY INTEREST (Details Narrative)
9 Months Ended
Jan. 31, 2017
Extractive Industries [Abstract]  
Concentration of Interest 100.00%
Production Royalty 5.00%
XML 52 R40.htm IDEA: XBRL DOCUMENT v3.6.0.2
PROMISSORY NOTES (Details Narrative) - USD ($)
3 Months Ended 6 Months Ended 9 Months Ended 12 Months Ended
Jan. 31, 2017
Jan. 31, 2016
Nov. 30, 2016
May 31, 2016
Jan. 31, 2017
Jan. 31, 2016
Apr. 30, 2016
Interest Payable Settled $ 416,623 $ 306,882     $ 1,159,725 $ 843,229  
Unamortized Debt Discount             $ 585,359
First Promissory Notes [Member] | Company Controlled By A Director Of The Company [Member]              
Promissory Notes Description         On September 13, 2013, January 27, 2014 and December 4, 2014, the Company entered into agreements with a company controlled by a director of the Company (the “Lender”) pursuant to which $5,787,280 was advanced to the Company in tranches (the “First Promissory Notes”). The First Promissory Notes were to mature as to $3,000,000 on December 2, 2016 and the balance due on December 31, 2016.    
Second Promissory Notes [Member]              
Promissory Notes Description         On February 18, 2015 and December 1, 2015, the Company entered into agreements with the Lender pursuant to which $5,457,000 was advanced to the Company in tranches (the “Second Promissory Notes”). The Second Promissory Notes mature were to mature as to $1,000,000 on December 2, 2016, $2,000,000 on June 2, 2017 and the balance due on December 2, 2017.    
Promissory Notes Advance 200,000       $ 200,000    
Third Promissory Notes [Member]              
Promissory Notes Description         Effective August 31, 2016, the Company entered into an agreement (dated June 1, 2016) with the Lender pursuant to which up to an additional $2,965,000 will be advanced to the Company in tranches (the “Third Promissory Notes”). In addition, the First Promissory Notes and the Second Promissory Notes were amended and combined with the Third Promissory Notes with a modified maturity date of December 2, 2017. All other terms of the First Promissory Notes and the Second Promissory Notes remained unchanged.    
Promissory Notes Advance $ 1,420,000       $ 1,420,000    
Promissory Notes [Member]              
Interest Rate 12.00% 12.00%     12.00% 12.00%  
Interest Recorded         $ 1,159,725   $ 525,136
Interest Payable Settled     $ 759,247 $ 640,130      
Shares Issued, Shares         852,562   349,325
Shares Issued, Fair Value         $ 200,756   $ 81,112
Accretion Expense         363,386 $ 142,702  
Unamortized Debt Discount $ 396,856       $ 396,856    
Promissory Notes [Member] | Bonus Shares [Member]              
Shares Issued, Shares         534,480    
Shares Issued, Fair Value         $ 55,239    
XML 53 R41.htm IDEA: XBRL DOCUMENT v3.6.0.2
WARRANT LIABILITIES (Details Narrative) - USD ($)
9 Months Ended 12 Months Ended
Jan. 31, 2017
Apr. 30, 2016
Disclosure of Compensation Related Costs, Share-based Payments [Abstract]    
Warrant Derivative Liabilities Fair Value $ 638,291 $ 326,595
XML 54 R42.htm IDEA: XBRL DOCUMENT v3.6.0.2
SHARE CAPITAL (Details Narrative) - USD ($)
9 Months Ended
Jan. 31, 2017
Apr. 30, 2016
Shares Issued, per Share $ 0.22  
Stock Options Available For Grant 2,378,160 2,797,895
Intrinsic Value Of Options Exercised $ 88,200  
Intrinsic Value Of Options Exercised, per Share $ 0.31  
Weighted Average Grant Date Fair Value Of Stock Options $ 0.123  
Unamortized Compensation Cost of Options $ 105,809  
Non Vested Stock Options, Shares 400,000
Non Vested Stock Options Intrinsic Value $ 729,614  
April 30 Commitment [Member]    
Shares Issued, Shares 349,325  
Shares Issued, Fair Value $ 81,112  
June 14, 2016 [Member]    
Shares Issued, Shares 980,000  
Shares Issued, Fair Value $ 167,736  
September 23, 2016 [Member]    
Shares Issued, Shares 486,346  
Shares Issued, Fair Value $ 116,756  
December 1, 2016 [Member]    
Shares Issued, Shares 1,170,084  
Shares Issued, Fair Value $ 132,838  
January 25, 2017 [Member]    
Shares Issued, Shares 366,216  
Shares Issued, Fair Value $ 84,000  
XML 55 R43.htm IDEA: XBRL DOCUMENT v3.6.0.2
RELATED PARTY TRANSACTIONS (Details Narrative) - USD ($)
3 Months Ended 9 Months Ended
Jan. 31, 2017
Jan. 31, 2016
Jan. 31, 2017
Jan. 31, 2016
Apr. 30, 2016
Management And Consulting Fees $ 58,221 $ 53,145 $ 247,047 $ 150,346  
Accounts payable and accrued liabilities 644,716   644,716   $ 1,023,137
RJG Capital Corporation [Member]          
Management And Consulting Fees     72,185 72,099  
Wayne Moorhouse, Director [Member]          
Management And Consulting Fees     2,179 2,293  
Malaspina Consultants Inc. [Member          
Management And Consulting Fees     20,096 17,776  
John Theobald, Director [Member]          
Management And Consulting Fees     36,542  
Directors Or Officers Or Companies Controlled By Them [Member]          
Accounts payable and accrued liabilities $ 200,799   $ 200,799   $ 189,501
XML 56 R44.htm IDEA: XBRL DOCUMENT v3.6.0.2
SEGMENT DISCLOSURES (Details Narrative)
9 Months Ended
Jan. 31, 2017
Segment Reporting [Abstract]  
Number of Operating Segments 1
XML 57 R45.htm IDEA: XBRL DOCUMENT v3.6.0.2
NON-CASH TRANSACTIONS (Details Narrative)
9 Months Ended
Jan. 31, 2017
USD ($)
shares
Promissory Notes [Member]  
Shares Issued, Shares | shares 534,480
Shares Issued, Fair Value | $ $ 119,644
Warrants, Shares | shares 534,480
Warrants, Fair Value | $ $ 55,239
Promissory Notes Interest [Member]  
Shares Issued, Shares | shares 3,825,822
Shares Issued, Fair Value | $ $ 708,883
Second Promissory Notes Interest [Member]  
Shares Issued, Shares | shares 1,390,294
Shares Issued, Fair Value | $ $ 54,035
Second Promissory Notes [Member]  
Shares Issued, Shares | shares 1,223,843
Shares Issued, Fair Value | $ $ 293,623
Warrants, Shares | shares 1,223,843
Warrants, Fair Value | $ $ 151,318
XML 58 R46.htm IDEA: XBRL DOCUMENT v3.6.0.2
SUBSEQUENT EVENTS (Details Narrative)
1 Months Ended
Mar. 15, 2017
Third Promissory Notes [Member]  
Event Description The Company received an aggregate of $125,000 of Third Promissory Notes.
Loan Agreement [Member]  
Event Date Mar. 13, 2017
Event Description On March 13, 2017, the Company entered into a loan agreement with an arm's-length lender pursuant to which up to CAD$250,000 may be advanced to the Company, subject to TSX Venture Exchange approval. The loan will bear interest at a rate of 12% per annum and is due on or before December 31, 2018. The Company and the lender agreed that the lender is to receive bonus shares equal to 7.5% of the loan divided by the Company's common share market price. In addition, the Company will issue the Lender an equal number of share purchase warrants.
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