Worthington Energy, Inc. (fka WGASQ)

[molecularcd]

It may very well be that Montecito wants out because they were compensated on 24 cent/share basis, but it looks to me like the default on this promissory note has something to with the legal basis of their grievance.

Montecito Promissory Note
On May 6, 2011, in connection with our acquisition of certain assets from Montecito, we issued Montecito a subordinated promissory note in the amount of $500,000.  The subordinated promissory note is subordinated to the secured convertible notes we issued in the private placement that closed on May 5, 2011.  The Montecito Note was due in September 2011 and accrued interest at the rate of 9% per annum until maturity and accrues interest at the highest legal rate allowed since maturity since the Montecito Note is in default for failure to pay principal and interest when due.

It is ugly, and I have to assume stuff like this is a major turn-off for more than a few potential investors.

Still, there's no getting around the fact that someone with rather deep pockets is serious about making VML179 happen (and cleaning up the books in the process). Just can't imagine anyone would even contemplate throwing 8.5 mil at VML if Montecito was unamenable to dropping the case under achievable means thru financing.