NOTE RECEIVABLE

9 Months Ended

Feb. 29, 2012

Receivables [Abstract]

Loans, Notes, Trade and Other Receivables Disclosure [Text Block]

NOTE 6.  NOTE RECEIVABLE

As a condition to the transaction between the Company and Black Rock, FSB required Black Rock to assume and acquire the Bamco Note. FSB would not consent to the transaction with the Company unless the loan was assumed and acquired and therefore the Company determined to do so even though the closing of the transaction had not yet occurred. As a result, on June 29, 2011, the Bamco Note was cancelled, Black Rock signed the Replacement Note to FSB and that note became the sole outstanding note owed to FSB in the amount of $2,681,201. Bamco Gas is currently in receivership and Alan Barksdale, the Company’s Chief Executive Officer, is the receiver.  As a further condition to the consummation of the transaction between the Company and Black Rock, FSB required a shareholder of the Company to pledge 2,000,000 shares of common stock of Red Mountain to further secure the Replacement Note. FSB agreed that in exchange for the Company and Black Rock to acquire and assume the Bamco Note, if the Replacement Note was not repaid from the proceeds of the sale of the Bamco Gas assets to a party other than the Company or Black Rock, or the assets of Bamco Gas were not acquired by the Company, within 12 months of the closing of the transaction, then the pledged shares would either be liquidated or retired to the Company, at the Company’s option.

Due to the uncertainty about collection or realizing the value of the note receivable through an acquisition of Bamco Gas, management has deemed it necessary to fully impair the value of the Replacement Note. No interest income was recognized on the Replacement Note.