15.      SUBSEQUENT EVENTS

In September 2011, the Company executed the definitive agreement pursuant to the Letter Agreement (note 6) with MRT, for the restructure of its Cieneguita joint venture. Under the restructured joint venture agreement the Company receives 20% of the net operating profits after royalties for material processed through a small-scale pilot operation and mined from the first 15 meters depth of the Cieneguita deposit until December 31, 2012. For all other material processed from the property, the Company's interest is 80% and MRT is reduced to a 20% working interest, subject to certain dilution provisions.

In September 2011, the Company executed debt conversion and release agreements to convert promissory notes in the amount of $1,002,264 into Company’s common shares at $0.30 per share for a total of 3,340,880 shares (note 7).

In September and October 2011, the Company received subscription proceeds of $175,000 in its active private placement. The subscribers to the subscription proceeds have agreed to purchase one unit for each $0.20 of subscription proceeds. Each unit consists of one share of the Company’s common stock and one warrant each exercisable at $0.30, which expires in two years.