NOTE 7 - RELATED PARTY TRANSACTIONS

The Company pays $2,500 per month to a related party for office space and administrative services on a month-to-month basis.  There are no long-term commitments pertaining to this arrangement.

During December of 2013 the Company sold its working wholly owned subsidiary Pipeline Nutrition U.S.A. Inc. which has had  consecutive net loss years to its current CFO and the management of Pipeline. The Company anticipates a gain of $139,050 on the transaction in addition receiving potential royalties from the company after the note receivable is paid based on a pre determined formula.

Pipeline currently owes the Company $300,000 from this transaction and no cash was exchanged in the initial transaction.

The Company agreed to set up short term notes payable to the board for unpaid fees during 2013 and the first quarter of 2014. A short term note was issued to Donna Steward for $3,750 and Charles Snipes for $1,500, Robert Anderson for $750, with a stated 8% interest rate. In addition the Company agreed to set a short term note payable to President Mike King for his 2013 and first quarter 2014 salary of $11,250 under the same terms. Each of the officers and directors holding such notes have agreed to accept shares of the Company’s common stock  as payment for these note obligations based upon the closing price of the Company's common stock on the last business day prior to such stock issuance in lieu of cash.

Our  subsidiary, Texas Gulf Exploration & Production  Inc., has entered into a five year  agreement  whereby we  have the right of first refusal to provide all wellhead services for all of Texas Gulf Oil & Gas, Inc. oil and or gas wells at cost plus 10% for such services. However, the value for such contract, as reported herein is only a potential future value and differ significantly as it is dependent on upon the future price of oil and the Company's ability to raise capital for the cost of providing services under the contract.

Texas Gulf Oil & Gas, Inc. has a 60-day right of first refusal to invest funds in any new oil or gas leases that Texas Gulf Exploration & Production  Inc. locates and signs leases for.