TransCoastal Corporation has entered into a forbearance agreement with Melody Business Finance, LLC pursuant to the new lender assuming the loan agreement dated May 2011 with Green Bank N.A. The principal amount of the note is $15,750,000 with a maturity date of June 1, 2015. The new lender has agreed to enter into a forbearance agreement regarding all existing events of default as well as agreed upon anticipated events of default pursuant to the default provisions of the existing loan agreement. In addition the forbearance agreement alters or adds material terms to the loan agreement including: Contract rate of interest is changed to a payment in kind interest rate of 15%; the rate of interest upon default is 21%; commits the company to engage in best efforts to negotiate and pursue a plan of reorganization of the company by April 6, 2015 and calls for implementation of the reorganization plan within 90 days from the date of execution of the agreement.