Change in Management

9 Months Ended

Sep. 30, 2013

Note 13 – Change in Management

Effective June 20, 2013, the Company entered into an agreement (the “ Agreement ”) with David Mathews pursuant to which the Company obtained the option to redeem Mr. Mathews’ Company issued capital stock in connection with Mr. Mathews’ resignation from his official positions and directorship with the Company to further his intention of working with the potential purchaser in continuing to lead these subsidiary companies. Pursuant to the Agreement, Mr. Mathews will continue to serve as CEO of one of the Company’s subsidiaries, TGE Industrial Services, Inc. As set forth in the Agreement, in the event that the Company does not consummate the transaction by July 31, 2013 or delay the transaction by mutual agreement, pursuant to which the purchase price consists of at least Five Million Dollars ($5,000,000) of which at least Three Million Dollars ($3,000,000) is a cash payment, the Company shall (a) have the option to purchase and redeem all of the shares of the Company’s capital stock held by Mr. Mathews by, (b) paying to Mr. Mathews a One Hundred Thousand Dollar ($100,000) cash payment (the “ Cash Payment ”) and executing and delivering a $900,000 promissory note in favor of Mr. Mathews, such promissory note having four percent (4%) interest, and to be satisfied in three (3) equal annual payments of Three Hundred Thousand Dollars ($300,000) commencing upon the one-year anniversary of the Cash Payment (the “ Redemption ”). The shares of capital stock subject to the redemption shall be delivered by Mr. Mathews in proportion to the payments received by him. Upon the payment of the Cash Payment to Mr. Mathews, he shall immediately be released from his non-compete obligations to the Company, and after sixty (60) days shall be released from his non-solicitation obligations to the Company. The Company and Mr. Mathews have agreed to extend the Company's option on a monty-to-month basis.

Texas Gulf Energy Inc 10-Q