Item 3. Legal Proceedings
Item
3. Legal Proceedings
From
time to time, we become involved in or are threatened with legal disputes. While most of these disputes are not likely
to have a material effect on our business, financial condition, or operations, the following matters are deemed by the Company
to be material either due to the costs of litigation or the potential negative impacts to the Company should these matters not be resolved
in our favor:
●
Crest Ventures, LLC – We have been sued in a putative breach of contract
case in the District Court for Arapahoe County, Colorado. The allegations in the action are based on a claim that Crest Ventures, LLC
is entitled to commission compensation on the February 2021 uplisting of our common stock to the Nasdaq Capital Market. We believe we
have substantial defenses to the claim asserted in this lawsuit and intend to vigorously defend this action.
●
Sunflower Bank – We have filed a lawsuit against Sunflower Bank related
to fraudulent wire transfers of approximately $5,100,000 that were made from our accounts at Sunflower Bank in October 2021. As of the
date of this Report, $875,950 of these funds have been returned to us. We are suing Sunflower Bank for the remaining $4,224,050 as we
believe that Sunflower Bank failed to follow industry standard procedures designed to prevent such a theft and is therefore liable for
the unrecovered balance. We expect Sunflower Bank, Sunflower Bank’s insurers, and/or our insurer to reimburse us for the remaining
balance.
ITEM
4. MINE SAFETY DISCLOSURES
Not
Applicable.
PART
II
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