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eWorldMedia Legal Proceedings

On September 16, 2005 Fastlink International, Ltd. filed a complaint against the Company, Henning D. Morales, Ronald C. Touchard and Thoroughbred Entertainment Industries, Inc. alleging fraud, deceit, breach of contract and intentional misrepresentation, among other causes of action regarding investments made in Thoroughbred Entertainment Industries, Inc. The Directors of the Company believe the Company was wrongfully named as a defendant and are in the process of trying to obtain a dismissal of the Company as a defendant in this action. In the alternative, the Company will defend vigorously against the action.

The Company has been named in a Lawsuit with Dwayne Heppner on a Matter that was a note for $30,000 between eWorldMedia, Inc, the Company’s former Subsidiary and Dwayne Heppner, the company believes that this is a matter between eWorldMedia, Inc , the Company’s former Subsidiary and Dwayne Heppner and does not involve Liberty Diversified Holdings, Inc and the company is defending and trying to be removed from the case.

Also on April 16, 2007 the company’s attorney informed the company that they were being added to a lawsuit between eWorldMedia, Inc., the Company’s former Subsidiary and FM 2 Radio. The company has not received any details on the lawsuit but will defend to be removed from the case as it has nothing to do with the matter, which was between FM 2 and the company’s former subsidiary, eWorldMedia, Inc.

The Company is not aware of any other current, pending or threatened legal proceedings against the Company, its subsidiaries or any of its officers or directors.

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