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IN THE UNITED STATES DISTRICT COURT FOR THE DISTRICT OF MINNESOTA

Gilberto NMN Garcia, Todd G. Louis, and High Five Holdco, Inc., a North Dakota Corporation, CASE NO.: _ _ _ _ _ _ _ __ Plaintiffs,

v. WCE Oil Field Services, LLC, a Delaware Limited Liability Company, WCE Oxbow Partners, LLC, a Delaware Limited Liability Company, H20, LLC, a Minnesota Limited Liability Company, EXMARQ Capital Partners, LLC, a Minnesota Limited Liability Company, Jack Helms, Individually, and Loren Unterseher, Individually,

COMPLAINT AND JURY DEMAND

Defendants.

For their Complaint against the Defendants named above, Plaintiffs Gilberto Garcia ("Garcia"), Todd Louis ("Louis"), and High Five Holdco, Inc., a North Dakota corporation ("High Five") (collectively, the "Plaintiffs") hereby state and allege as follows: PARTIES 1.

Plaintiff Gilberto Garcia is an adult resident of the State of North Dakota

whose current address is: 10- 18th Street SW, Minot, ND 58701. 2.

Plaintiff Todd Louis is an adult resident of the State of North Dakota whose

current address is: 520 Golf Drive, Stanley, ND 58784.

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3.

Plaintiff High Five Holdco, Inc. is a corporation formed under the laws of

the State ofNorth Dakota whose registered address is: 520 Golf Drive, Stanley, ND 58784. 4.

Defendant WCE Oil Field Services, LLC is a limited liability company

formed under the laws of the State of Delaware whose registered address is: The Corporation Trust Company, Corporation Trust Center, 1209 Orange Street, Wilmington, DE 19801. 5.

Defendant WCE Oxbow Partners, LLC is a limited liability company formed

under the laws of the State of Delaware whose registered address is: The Corporation Trust Company, Corporation Trust Center, 1209 Orange Street, Wilmington, DE 19801. 6.

Defendant H2G, LLC is a limited liability company formed under the laws

of the State of Minnesota whose registered address is: 5850 Opus Parkway, Suite 170, Minnetonka, MN 55343. 7.

Defendant EXMARQ Capital Partners, LLC is a limited liability company

formed under the laws of the State of Minnesota whose registered address is: 5850 Opus Parkway, Suite 240, Minnetonka, MN 55343. 8.

Defendant Jack Helms ("Helms") is an adult individual resident of the State

of Minnesota whose current address is: 4906 Lakeview Drive, Edina, MN 55424. Defendant Helms owns and controls Defendant H2G, LLC. 9.

Defendant Loren Unterseher ("Unterseher") is an adult individual resident of

the State of Minnesota whose current address is: 500 West Highway 96, Shoreview, MN 55126. Defendant Unterseher owns and controls Defendant WCE Oxbow Partners, LLC.

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JURISDICTION AND VENUE 10.

Plaintiffs and Defendants WCE Oxbow Partners, LLC, H2G, LLC and

EXMARQ Capital Partners, LLC (hereinafter "Buyer Defendants") entered into an agreement on August 21, 2014, titled Membership Interest Purchase Agreement ("MIP A") and attached hereto as Exhibit A. The MIP A was part of a transaction whereby the Defendants acquired a controlling interest in Defendant WCE Oil Field Services, LLC (hereinafter "Defendant WCE, LLC"). 11.

Among other things, the MIP A provides that interpretation of the MIPA shall

be in accordance with the laws of the State of Minnesota, any action or proceeding arising out of or based on the MIPA may be instituted in State or Federal Courts located in Hennepin County, Minnesota, and that each party irrevocably submits to the jurisdiction of such Courts for purposes of any such action or proceeding. 12.

This Court is an appropriate venue for this lawsuit because of the diversity

in citizenship, it arises out of and relates to the MIPA, the majority of the Parties hereto are located in the State of Minnesota, and it is the most convenient location for Parties that are not located in the State of Minnesota. FACTUAL ALLEGATIONS 13.

In about 20 11, Plaintiffs Garcia and Louis formed a North Dakota

corporation known as WCE Oil Field Services, Inc. (hereinafter "WCE, Inc.") to perform various services for the oil industry in western North Dakota. During the first three (3) years of operations, WCE, Inc. dramatically grew to revenues of about $3 0 million in 2013.

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14.

During that timeframe, Plaintiffs Garcia and Louis signed personal

guarantees to secure a number of equipment leases and other lending facilities for WCE, Inc. ("Guaranteed Debts"). 15.

In 2014, Plaintiffs Garcia and Louis and the other shareholder ofWCE, Inc.,

agreed to sell a controlling interest in WCE, Inc., which was converted into Defendant WCE, LLC in connection with the transaction, to Buyer Defendants (the "Transaction"). 16.

Plaintiffs Garcia and Louis and another shareholder formed the entity High

Five Holdco, Inc. as a holding company for their interests in Defendant WCE, LLC. WCE, LLC became a wholly-owned subsidiary of WCE Holdco, LLC, a Delaware limited liability company formed to hold the Parties' respective interests in WCE, LLC. 17.

In the letter of intent among the Parties and otherwise during the negotiations

leading to the Transaction, Buyer Defendants repeatedly assured Plaintiffs that as part of the deal, Buyer Defendants would satisfY and/or remove the personal guarantees on the Guaranteed Debts. This commitment was material consideration for Plaintiffs in the Transaction. 18.

The terms ofthe Transaction are described in the MIPA. In the MIPA, Buyer

Defendants agreed to pay for their majority stake in Defendant WCE, LLC based on an agreed "enterprise value" of the business minus certain offsets for debt obligations that were to be satisfied and/or refinanced (removing the personal guarantees) by Buyer Defendants and Defendant WCE, LLC including the Guaranteed Debts. 19.

The purchase price was subject to adjustment based on an estimate for the

amount of "working capital" Defendant WCE, LLC held as of the Transaction's closing. 4

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Working capital under the MIPA was subject to final adjustment to be made within ninety (90) days after the closing and was to be determined based on generally accepted accounting principles as of the closing date. 20.

In the MIPA, Buyer Defendants agreed to secure and provide adequate funds

at the closing to enable Defendant WCE, LLC and/or Louis and Garcia themselves to pay off the Guaranteed Debts. 21.

Defendants were responsible for and held themselves out as experienced and

knowledgeable in regard to financing and lender relationships, among other things. Defendants were responsible for and undertook to secure the capital necessary to effectuate the MIPA. 22.

As a result of the Transaction, Defendant Helms was appointed to the

position of Treasurer and Defendant Unterseher was appointed Chairman of the Board of Managers at WCE, LLC. Entities owned by Defendants Helms and Unterseher known as Helms Capital, LLC and Oxbow Industries, LLC also entered a management agreement with WCE, LLC to provide administrative advice and support for $350,000.00 per year. 23.

Following the Transaction, by agreement, Plaintiff Louis remained employed

by Defendant WCE, LLC initially with the title of Vice President of Field Operations with an agreed upon annual salary and other compensation incentives. Plaintiff Garcia's interest in Defendant WCE, LLC was purchased in its entirety by Buyer Defendants and Garcia had no residual ownership interest in Defendant WCE, LLC (by way of High Five Holdco, Inc.) following the closing.

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24.

The closing on the Transaction occurred on August 21,2014. Despite having

undertaken to provide funds and/or secure adequate financing to fulfill their obligations in the MIP A, Buyer Defendants failed to pay off or restructure certain Guaranteed Debts at or following the closing (or to otherwise cause Defendant WCE, LLC to do so). 25.

Ninety (90) days following the closing, representatives of WCE, LLC

determined that a working capital adjustment in excess of $1 million was due and payable to Plaintiffs, however Buyer Defendants failed to provide for payment. 26.

Rather than provide for payment as required under the MIP A, Defendants

Helms and Unterseher used false pretenses to convince Plaintiffs to agree upon extensions of the time for payment of the working capital adjustment and with regard to a separate transition bonus obligation that had accrued. 27.

Defendants Helms, Unterseher and their agents misled Plaintiffs to believe

that a set-off may be warranted against the working capital adjustment due to an overdue account receivable that had accrued since the closing, and sought an extension of time for payment ofthe working capital adjustment pending determination of the extent of such setoff. 28.

At year end, Defendants Helms, Unterseher and their agents also misled

Plaintiffs to believe that no transition bonus was likely due under the MIP A due to the above-referenced overdue account receivable, and sought an extension for payment of the transition bonus obligation so they could find another way to provide consideration to Plaintiffs.

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29.

Upon information and belief, Defendants Helms and Unterseher knew that

the working capital adjustment and transition bonuses were owed to Plaintiffs, imd not otherwise impacted by the aforesaid account receivable, but made the representations as a ruse to buy time because Buyer Defendants were not willing and/or unable to contribute the capital necessary to fulfill their remaining obligations under the MIP A. 30.

Plaintiffs were misled and relied on the representations by Defendants Helms

and Unterseher in granting Buyer Defendants additional time in the form of two (2) otherwise unwarranted amendments to the MIP A. 31.

Following the closing, under Defendants' leadership and despite not having

removed the underlying personal guarantees, Defendant WCE, LLC assumed control of and used the equipment that had been secured subject to the Guaranteed Debt in the course of its operations. 32.

Within less than a year of the closing, the declining price of oil, substantial

customer defaults, mismanagement and other significant issues including Buyer Defendants' failure to provide the requisite capital under the MIPA, precipitated insolvency and Defendant WCE, LLC is now being liquidated in a court-ordered receivership proceeding (ND Court File No. 09-2015-CV-01394). 33.

In an effort to avoid the eventual insolvency of Defendant WCE, LLC,

Defendants made an effort to secure additional capital from investors including Plaintiff Louis. Defendants Helms and Unterseher used false pretenses to secure Plaintiff Louis' additional investment.

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34.

Defendants Helms and Unterseher, together with their agents made

statements and provided financial data to Plaintiff Louis which, among other things, reaffirmed Buyer Defendants and WCE, LLC's obligation to pay the working capital adjustment and the transition bonus. 35.

Plaintiff Louis was misled and relied, to his detriment, on the false statements

and financial information provided by Defendants Helms and Unterseher in that it reasonably led Plaintiff Louis to expect a substantial payment that would have offset the solicited investment. 36.

After securing a $400,000.00 investment from Plaintiff Louis in WCE, LLC,

contrary to the terms of the MIP A, Defendants now claim that they were never obligated to pay the working capital adjustment and that no transition bonus was ever earned or promised in the first place. 37.

Within a month of secunng Plaintiff Louis' additional $400,000.00

investment, WCE, LLC defaulted on its salary and compensation obligations to Plaintiff Louis and others as well as its lending obligations to Wells Fargo Bank. Plaintiff Louis went unpaid in his final months of work for WCE, LLC and is owed compensation and benefits in excess of$120,000.00. 38.

Since the demise of Defendant WCE, LLC, various creditors have asserted

claims against Plaintiffs Garcia and Louis on Guaranteed Debts that were not satisfied by Buyer Defendants. As of the date of this Complaint, there are three (3) actions pending against the Plaintiffs in North Dakota and the State of Mississippi. The Plaintiffs in these actions assert claims in excess of $1.5 million. 8

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39.

As to the Guaranteed Debts, Plaintiffs have been compelled to fend for

themselves, receiving absolutely no assistance from WCE, LLC or the other Defendants for dealing with creditors, securing the underlying collateral or otherwise dealing with their claims. 40.

In addition to failing to pay off pre-existing Guaranteed Debts at the time of

closing as required by the MIP A, Plaintiffs have now discovered that on the eve of Defendant WCE, LLC's demise, without Plaintiffs' knowledge or consent, as a result of their management of Defendant WCE, LLC, Defendants incurred a number of new charges and liabilities that give rise to personal liability as to Plaintiffs Garcia and Louis. 41.

Among other things, Plaintiff Louis has been pursued on a worker's

compensation insurance claim in excess of $150,000.00 premised on an erroneous report filed by an agent of Buyer Defendants. Plaintiff Louis is being pursued on an open line of credit for truck rental that was charged on the eve of WCE, LLC's demise by agents of Buyer Defendants. Plaintiffs are being pursued on other open lines of credit for debts in excess of $1 million that did not accrue until after the conversion to WCE, LLC. 42.

According to the MIP A, Defendants are obligated to defend, indemnify and

hold Plaintiffs Garcia and Louis harmless from any losses suffered as a result of Defendants' breach of any covenants or agreements therein. 43.

Plaintiffs Garcia and Louis have notified Defendants of the various claims

against them as a result of Defendants' failure to pay off the Guaranteed Debts or make the working capital adjustment, and demanded that Defendants fulfill their obligation to defend and indemnify, but Defendants have failed and refused to do so. 9

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44.

Upon information and belief, as a result of Defendants' failure to capitalize

WCE, LLC as agreed in the MIPA, among other things, the Company does not have adequate assets or receivables to pay the obligations set forth above, other unsecured obligations, or its other obligations to secured lenders.

CAUSES OF ACTION COUNT I- BREACH OF CONTRACT 45.

Based on the foregoing factual assertions which will be proven at trial, the

Defendants and each of them have breached the MIP A in failing to pay off and/or restructure the Guaranteed Debts; in failing to make the working capital adjustment; in failing to pay a transition bonus; in failing to pay Plaintiff Todd Louis' salary and benefits; and in failing to defend and indemnify Plaintiffs in regard to the Guaranteed Debts, among other things. 46.

Buyer Defendants and each of them are jointly and severally liable to the

Plaintiffs on account of these breaches in amounts to be proven at trial.

COUNT II- FRAUD/MISREPRESENTATION 47.

Defendants, through Helms and Unterseher, made misrepresentations as

referenced above to Plaintiffs regarding the working capital adjustment and the transition bonus knowingly, intending that Plaintiffs would rely on that information in deferring action and for further investment in WCE, LLC. 48.

Plaintiffs relied on Defendants' misrepresentations, to their detriment, and

have suffered damages for which Defendants are liable in amounts to be proven at trial.

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COUNT III- SECURITIES FRAUD 49.

As specified in the factual summary above, Defendants Helms and

Unterseher made untrue statements and/or failed to provide material facts necessary not to make their statements misleading with respect to soliciting additional investment by Plaintiff Louis in WCE, LLC and Plaintiff Louis has been harmed by their conduct. 50.

Defendants Helms and Unterseher are liable to Plaintiff Louis for securities

fraud under pertinent state and federal laws including 17 CFR 240.10b-5.

COUNT IV- CONTRIBUTION 51.

The claims of creditors asserted against Plaintiffs are justly and equitably

attributable to all of the stakeholders in WCE, LLC including the Buyer Defendants, particularly where they result from Buyer Defendants' failure to manage the affairs of WCE, LLC, represent unauthorized charges in the circumstances and/or represent failure by Buyer Defendants to honor their contractual obligations to Plaintiffs. 52.

Such claims and the defense thereof represent common liabilities that

exclusively and unjustly burden Plaintiffs. Buyer Defendants are therefore liable to Plaintiffs for at least their pro rata share of such common liabilities.

II

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WHEREFORE, Plaintiffs seek judgment against Defendants as follows:

1.

Awarding damages in an amount to be proven at trial exceeding two million

and no/1 00 ($2,000,000.00) dollars; 2.

Awarding Plaintiffs their reasonable costs, disbursements and attorney's

fees; and 3.

Granting such further relief as the Court should deem just and equitable in

the premises.

Dated: October 8, 2015

s/Stephen W. Hance Stephen W. Hance MN Bar #264143 Attorney for Plaintiffs Gilberto Garcia, Todd Louis and High Five Holdco, Inc. HANCE LAW FIRM, LTD. 155 Lake Street East Wayzata, MN 55391 Telephone: (952) 236-1453 Fax: (952) 4 73-0302 swh@hancelaw .net

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