COMMITMENTS AND CONTINGENCIES |
9 Months Ended |
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Jun. 30, 2022 | |
Commitments and Contingencies Disclosure [Abstract] | |
COMMITMENTS AND CONTINGENCIES | NOTE 4– COMMITMENTS AND CONTINGENCIES
Litigation
The Company is currently not involved in any litigation that it believes could have a material adverse effect on its financial condition or results of operations.
In December 2017, Robert LeBlanc filed a petition against the Company and Michael De La Garza, the Company’s former Chief Executive Officer and President, in the 20th Judicial District for Hays County, Texas (Cause No. 18-0005). Mr. LeBlanc sought damages against the Company exceeding $1 million, but less than $10 million. On May 19, 2022, Mr. LeBlanc entered into a joint settlement agreement with the Company, the Company’s directors and officer’s liability carrier, and Mr. De La Garza. As part of this settlement agreement, the Company paid Mr. LeBlanc $109,432 in cash and issued him shares of the Company’s common stock in exchange for his release of the Company from all past and future liabilities associated with this matter.
In April 2020, Eric Marquez, the former Secretary/Treasurer and Chief Financial Officer of the Company, and certain other plaintiffs filed a lawsuit against the Company and Michael De La Garza, the Company’s former Chief Executive Officer and President, in the 20th Judicial District for Hays County, Texas (Cause No. 20-0818). The lawsuit alleges causes of action for fraud against Mr. De La Garza (for misrepresentations allegedly made by Mr. De La Garza); breach of contract, for alleged breaches of Mr. Marquez’s alleged oral employment agreement with the Company, which Mr. Marquez claims required the Company to pay him cash and issue him shares of the Company’s stock; unjust enrichment; quantum meruit; and rescission of certain stock purchases made by certain of the plaintiffs, as well as requests for declaratory relief. Damages sought exceed $1,000,000. The Company believes it has made all required payments and delivered all required shares of stock to the plaintiffs. The case is currently being defended by the Company. The Company believes it has meritorious defenses to the allegations, and the Company intends to continue to vigorously defend the litigation.
Leases
As of June 30, 2022, the Company had no financial obligations for facility lease agreements, except as set forth below.
Prior to December 1, 2021, Tom Wilkinson, the Company’s Chairman of the Board, provided the Company with the use of office space that he rents, located at 6836 Bee Caves Road, Building 1, Suite 279, Austin, TX 78746, for its corporate headquarters. After December 1, 2021, the Company entered into a month-to-month lease agreement for this office space with Nolen & Associates, under which the Company pays Nolen & Associates $500 per month in rent.
The Company’s rent expense totaled $1,500 and $3,641 for the three and nine months ended June 30, 2022, and $170,265 and $306,453 for the three and nine months ended June 30, 2021, respectively.
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