BRINX RESOURCES LTD

In April 2013, Jeffrey R. Beckett, a shareholder of the Company, filed a lawsuit in the District Court of Washoe County, Nevada against the Company, its directors, Kenneth A. Cabianca and George Knight, and a principal of one of the Company's consultants, Sarah Cabianca, generally alleging mismanagement of the Company's affairs by the directors to the detriment of the Company and its shareholders (the "State Lawsuit"). The State Lawsuit seeks the issuance of an injunction, the appointment of a receiver and unspecified damages. In June 2013, Mr. Beckett filed a similar complaint against the same defendants in the United States District Court for the District of Nevada (the "Federal Lawsuit").  Sarah Cabianca has been dismissed from the State Lawsuit and the Federal Lawsuit has been dismissed.  The Company has settled this lawsuit with the result that all the directors and officers have resigned and Jeffery R. Beckett has been appointed to the Board of Directors as Chairman and sole director of the Company.  As part of the settlement the Company was no longer obligated to pay $117,000 in accrued expenses to the former management and directors and thus these expenses have been reversed.

Five wells were drilled during 2009.  Production casing was set on four of the five wells and the fifth well was deemed non-commercial and was plugged and abandoned.   Two of the four completed wells are still producing commercial quantities of oil and gas, with one of the wells still flowing naturally and producing most of the oil.  One development well was drilled in August of 2011 near the highest producing well in the program.  For the nine months ended July 31, 2015, the three producing wells in this program have produced a total of 99 Bbls of oil and 138 Mcf of natural gas.   For the three months ending July 31, 2015, the three producing wells in the program have produced a total of 20 Bbls of oil and 58 Mcf of natural gas.

There was no loss or gain on the sale of marketable security for the three months ended July 31, 2015, as compared to a loss of $10,664 for the three months ended July 31, 2014.  There was no interest earned during the three months ended July 31, 2015 as compared to interest of $50 for the three months ended July 31, 2014.  During the three months ending July 31, 2015 and as part of the settlement of the Beckett litigation, the Company was no longer obligated to pay $117,000 in accrued expenses to the former management and directors and thus these expenses have been reversed.

Our general and administrative costs decreased to $269,410 for the nine months ended July 31, 2015, from $347,991 for the nine months ended July 31, 2014.  The decrease of $78,581 is primarily attributable to amounts payable to former directors and officers which are no longer payable due to the change of management.

In April 2013, Jeffrey R. Beckett, one of our shareholders, filed a lawsuit in the District Court of Washoe County, Nevada against us, our directors, Kenneth A. Cabianca and George Knight, and a principal of one of our consultants, Sarah Cabianca, generally alleging mismanagement of our affairs by our directors to our detriment and the detriment of our shareholders (the "State Lawsuit").  The State Lawsuit seeks the issuance of an injunction, the appointment of a receiver and unspecified damages.  In June 2013, Mr. Beckett filed a similar complaint against the same defendants in the United States District Court for the District of Nevada (the "Federal Lawsuit").  Sarah Cabianca has been dismissed from the State Lawsuit and the Federal Lawsuit has been dismissed.  The Company has settled this lawsuit with the result that all the directors and officers have resigned and Jeffery R. Beckett has been appointed to the Board of Directors as Chairman and sole director of the Company.  As part of the settlement the Company was no longer obligated to pay $117,000 in accrued expenses to the former management and directors and thus these expenses have been reversed.