On or about August 21, 2013, W. Brown Glenn, Jr., the Chief Executive Officer and a director of the Company wired $460,000 of the Company’s funds to a law firm in Minnesota to settle a judgement which had been entered against Pegasus in a matter completely unrelated to the Company. In his instructions to the Company’s bank, Mr. Brown indicated the wire was for a transaction with Nacona Production Company and caused the Company to file its Form 10-K reflecting that the wire was a deposit against a pending asset acquisition, all of which was not true. The Company has been aggressively pursuing its claims against Pegasus and its members including, Mr. Brown. The Company has settled its claims against Pegasus and all its members except Mr. Brown. The Company is currently in settlement discussions with Mr. Brown, but should such discussions not result in a satisfactory settlement, the Company intends to aggressively pursue all of its legal remedies against Mr. Brown. On September 15, 2014, the Company entered into a settlement agreement with Pegasus and its members except Mr. Brown, the principle terms of which include forgiveness by Pegasus of the balance of the promissory note ($100,000 amount due as of September 30, 2014), surrender of 350,000 shares of the Company’s common stock to the Company, and placement of a lockup on most of the remaining shares of the Company’s common stock owed Pegasus and the other settling parties. Neither Pegasus nor any of its members, including Mr. Brown, has any further relationship with the Company in any form.