UNITED STATES

SECURITIES AND EXCHANGE COMMISSION 

Washington, D.C. 20549

FORM 8-K

CURRENT REPORT

Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

Date of Report (Date of earliest event reported): November 21, 2022

Diego Pellicer Worldwide, Inc.  

(Exact Name of Registrant as Specified in Charter)

6160 Plumas Street, Reno, Nevada 89519  

Registrant’s telephone number, including area code: (516) 900-3799

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

Securities registered pursuant to Section 12(b) of the Act:

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).

Emerging growth company ☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

The information set forth in Item 8.01 below is incorporated herein by reference.

Lawsuit

In addition, the Parties shall enter into two Membership Interest Purchase Agreements (each, a “MIPA”) pursuant to which Neil Demers, majority owner of RAM and VPC, will transfer and cause to transfer 100% of all membership interests of RAM and 99% of membership interests of VPC to the Company, a subsidiary of the Company, or a special purpose acquisition company designated by the Company, as applicable. In exchange for the Transaction, at the closing: (a) the Company shall release the Confessions; (b) the Company shall issue 12.5% of the Company’s outstanding shares of common stock to Demers, as of May 21, 2023; and (c) the Company shall issue 28.3% of the Company’s outstanding shares of common stock to Phi Beta Capital Advisors, Ltd. (“PBC”) as of May 21, 2023.

The Parties’ performance under the MIPAs will be conditioned upon the occurrence of the following events: (a) the Company will have been found suitable to own RAM and VPC by the State of Colorado’s Marijuana Enforcement Division (“MED”), which is the agency that oversees the licensing and operation of Colorado dispensaries, and the City and County of Denver pursuant to the Marijuana Code, and the MED will have approved the Transaction; (b) the Company will have obtained shareholder approval for the Transaction; (c) Within 60 days of the Effective Date, RAM and VPC will have obtained the approval of PBC of the Transaction, in full accord and satisfaction of RAM’s and VPC’s debt obligations to PBC. If PBC does not approve the Transaction, the amount of the Confessions will remain at $4,350,000.00 for RAM and $65,000.00 for VPC; (d) RAM and VPC will have provided audited financial statements to the Company prior to the closing; (e) RAM and VPC will provide any and all documents, including, but not limited to, leases, notes, loan documents, bank statements, vendor contracts, payroll records, all records regarding government enforcement actions, all records regarding VPC’s and RAM’s licenses, tax returns, and notices of any potential litigation that may involve RAM or VPC; and (f) Satisfactory completion of each Party’s due diligence during the due diligence period, which shall be 150 days from the Effective Date (the “Due Diligence Period”)

Upon the execution of this Term Sheet, each Party, and any and all of their past and present agents, representatives, entities, affiliates, principals, officers, directors, employees, attorneys, heirs, and for anyone who has or obtains rights from such Party, hereby mutually releases the other Party from any claims, liabilities, charges or actions, whether known or unknown at the time of this Term Sheet, any Party may have against another Party, including without limitation claims which are in any way connected to or arise out of the Action with prejudice once RAM and VPC meet their obligations as described in the Term Sheet.

Stipulation for Entry and Confession of Judgment

On November 29, 2022, the Company entered into separate Stipulation for Entry and Confession of Judgments with Ram and VPC (the “Confessions”). RAM, which is subject to the terms of the Term Sheet, consented to its respective Confession in the amount of $4,435,000. However, the amount of the RAM confession may be reduced to $3,335,000 if the Company if the Transaction is terminated for failure to obtain shareholder approval or during the Due Diligence Period (defined below), or if the MED does not approve the Transaction, the amount of the Confessions will be reduced to $3,435,000. VPC consented to its respective Confession in the amount of $65,000.

The foregoing description of the Action, the Term Sheet, and the Confessions do not purport to be complete and are qualified in their entirety by reference to the full text of the Action, Term Sheet, and the Confessions, which are filed as Exhibits 99.1, 99.2, 99.3, and 99.4, respectively, to this Current Report on Form 8-K and are incorporated herein by reference.

(d) Exhibits:

* Filed herewith

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

Dated: December 6, 2022

Exhibit 10.1

BINDING SETTLEMENT TERM SHEET

November 21, 2022 (the “Effective Date”)

This Binding Settlement Term Sheet (this “Term Sheet”) is entered into by and between, on the one hand, Royal Asset Management, LLC, a Colorado limited liability company (“RAM”), Venture Product Consulting, LLC, a Colorado limited liability company (“VPC”), and, on the other hand, Diego Pellicer Worldwide, Inc., a Nevada corporation (“DPWW,” and together with RAM and VPC, each a “Party” and together, the “Parties.”) The transactions contemplated by this Term Sheet will be fully set forth in final documents acceptable to the Parties (“Definitive Documentation”).

RAM and DPWW are parties to that certain lawsuit captioned as Diego Pellicer Worldwide, Inc. v. Royal Asset Management, LLC, Case No. 2021 CV 32364, in the District Court of and for the City and County of Denver, Colorado (the “Action”).

RAM and VPC are both licensed as Regulated Marijuana Businesses as defined in rules promulgated by the Colorado Marijuana Enforcement Division (“MED”) pursuant to Sections 14 and 16 of Article XVIII of the Colorado Constitution, the Colorado Marijuana Code, §§ 44-10-101, et seq., C.R.S., as the same may be supplemented or amended from time to time, together with the regulations promulgated thereunder, and all applicable local laws and regulations thereto promulgated by a governmental authority (collectively, the “Marijuana Code”).

The Parties wish to resolve disputes among them, including the Action, without the admission of fault by any Party, and enter into a transaction to combine the business of each Party as described below, and as will be further set forth in the Definitive Documentation (the “Transaction”).

Now, therefore, the Parties agree as follows:

(a)        The Confessions will not be enforceable and DPWW shall not file the Confessions in any court until the later of (1) the date on which RAM’s debt to Capital 420, LLC is repaid, or (2) May 31, 2023.

(b)        If the Transaction is terminated by DPWW for failure to obtain shareholder approval or during the Due Diligence Period (defined below), or if the MED does not approve the Transaction, the amount of the Confessions will be reduced to $3,435,000 for RAM and $65,000 for VPC.

(c)        The Confessions will bear interest at the applicable rate for post-judgment interest under the laws of the State of Colorado.

Upon execution of this Term Sheet, the Parties shall jointly file a notice of settlement with the Court, notifying the Court that the Action has been settled, and requesting that the trial date in the Action be vacated, and DPWW shall promptly file a notice of dismissal dismissing its claims in the Action with prejudice.

(a)        will close within 10 days after the date upon which all requisite approvals for the MIPA have been obtained from the MED and the City and County of Denver or when RAM’s debt to Capital 420, LLC is paid, whichever date is later (the “Closing”).

(b)       shall be effective to transfer ownership of all membership interests of RAM and VPC to DPWW.

(c)       shall be effective to change Controlling Beneficial Ownership (as defined in the Marijuana Code) of RAM’s and VPC’s licenses to DPWW, at the Closing.

(d)      Neil Demers, as managing member of RAM and VPC, will agree to indemnify DPWW for liabilities of RAM and VPC which were not reflected on financial records provided by RAM or VPC in connection with the Transaction during the Due Diligence Period (defined below).

(a)        DPWW shall release the Confessions.

(b)       DPWW shall issue 12.5% of DPWW’s outstanding shares of common stock to Neil Demers. Outstanding shares means the number of common stock outstanding shares as of May 21, 2023.

(c)        DPWW shall issue 28.3% of DPWW’s outstanding shares of common stock to Phi Beta Capital Advisors, Ltd. (“PBC”) Outstanding shares means the number of common stock outstanding shares as of May 21, 2023.

(a)        DPWW will have been found suitable to own RAM and VPC by the MED and the City and County of Denver pursuant to the Marijuana Code, and the MED will have approved the Transaction.

(b)        DPWW will have obtained shareholder approval for the Transaction.

(c)        Within 60 days of the Effective Date, RAM and VPC will have obtained the approval of PBC of the Transaction, in full accord and satisfaction of RAM’s and VPC’s debt obligations to PBC. If PBC does not approve the Transaction, the amount of the Confessions remain $4,350,000.00 for RAM and $65,000.00 for VPC pursuant to paragraph 1 above.

(d)        RAM and VPC will have provided audited financial statements to DPWW prior to the Closing.

(e)        RAM and VPC will provide any and all documents, including, but not limited to, leases, notes, loan documents, bank statements, vendor contracts, payroll records, all records regarding government enforcement actions, all records regarding VPC’s and RAM’s licenses, tax returns, and notices of any potential litigation that may involve RAM or VPC.

(f)        Satisfactory completion of each Party’s due diligence during the Due Diligence Period.

(a)        Each Party shall operate their respective businesses in the ordinary course.

(b)        Each Party shall fully and promptly cooperate with due diligence requests from the other Party in connection with the Transaction.

(c)        Each Party shall promptly cooperate with any reasonable request from the other Party regarding any application filed under the Marijuana Code, or any request from the MED or the City and County of Denver.

(d)        Upon completion of the Due Diligence Period, DPWW shall immediately submit this Term Sheet and the Transaction to its shareholders for approval and vote, and shall use commercially reasonable efforts to obtain such approval, provided that RAM and VPC have complied with their respective due diligence obligations under Section 4.

(e)         RAM and VPC shall promptly submit this Term Sheet to PBC for approval by PBC of the Transaction in full accord and satisfaction of RAM’s and VPC’s debt obligations to PBC, and shall use commercially reasonable efforts to obtain such approval.

(f)         As soon as practicable following the date of this Term Sheet, DPWW shall assign its lease for the leased premises located at 2949 W. Alameda Ave., Denver, CO to RAM, and the Parties shall terminate the Alameda Sublease.

(g)        RAM shall pay all revenue received from Melody & Company Management, LLC towards amounts payable under Capital 420, LLC.

(h)        Prior to the Closing, RAM shall use commercially reasonable efforts to exchange Mark Smith, Yvonne Smith, and Julie Funiyama’s membership interests in RAM into unsecured promissory notes made by RAM not to exceed the aggregate of $150,000 principal.

(a)        At Closing, DPWW shall authorize and issue new shares of common stock of its existing outstanding shares of common stock in accordance with Section 3 of this Term Sheet.

(b)        Following the Closing, DPWW shall perform a reverse stock split in order to elevate its stock price above $0.10.

(c)        Prior to the Closing, DPWW shall obtain up-listing on the OTCQB or other exchange acceptable to MED for listing of a Publicly- Traded Corporation to own a Regulated Marijuana Business.

(d)        Upon the Closing, DPWW shall offer Neil Demers a C-Suite level position at a compensation package and on terms agreed to by the Parties.

(a)         That certain Commercial Sublease Agreement dated September 8, 2015 between RAM and DPWW (the “Alameda Sublease”);

(b)         That certain Sublease Termination Agreement dated October 1, 2020, between RAM and VPC, on one hand, and DPWW, on the other hand;

(c)        That certain promissory note dated October 16, 2020, made by RAM and payable to DPWW;

(d)        That certain promissory note dated October 16, 2020, made by VPC and payable to DPWW;

(e)        That certain Fee Agreement dated December 5, 2016, between RAM and DPWW; and

(f)        That certain promissory note dated April 3, 2018, made by RAM and payable to DPWW.

(a)        Advice of Counsel. Each Party has had the opportunity to seek the advice of independent legal and tax counsel and has read and understood each of the terms and provisions of this Term Sheet.

(b)        Authority to Execute. Each Party has full power and authority to execute, deliver, and perform this Term Sheet and the Transactions contemplated hereunder, and has taken all necessary steps for the execution and delivery of this Term Sheet

(c)        No Previous Assignment. No Party has previously assigned, transferred, granted, or purported to assign, transfer, or grant any of the claims, counterclaims, or defenses related to the Action.

(a)        If this Term Sheet is terminated by either Party during the Due Diligence Period, the liabilities and obligations with respect to the Confessions as set forth in the foregoing Paragraph 1, the releases set forth in Paragraph 8, and the provisions of Section 6(f), shall remain in effect.

(b)        If this Term Sheet or the Transaction is terminated by DPWW during the Due Diligence Period or prior to Closing due to the failure of the conditions set forth in Sections 5(a) or 5(b) the amount of the Confessions will be reduced as set forth in Section 1(b).

(c)        If this Term Sheet or the Transaction is terminated for any reason, the Confessions as modified herein, and the Release will remain in full force and effect.

12. Miscellaneous

(a)         No Admission. Neither this Term Sheet nor any action taken hereunder is to be construed as an admission by any Party that it has violated any contract, local, state or federal law, statutory or common, or as an admission by any Party of the factual accuracy or truth of any claim related to disputes or potential disputes addressed by this Term Sheet.

(b)         Entire Agreement. This Term Sheet supersedes all prior discussions and agreements between the Parties and/or their representatives with respect to the subject matter hereof and contains the sole and entire agreement between the Parties with respect to the subject matter hereof.

(c)         Governing Law and Venue. This Term Sheet is governed by and construed and enforced in accordance with the laws of the State of Colorado, without giving effect to any conflict or choice of law provision that would result in imposition of another state’s law. The Parties irrevocably submit to the exclusive jurisdiction of the state courts located in the City and County of Denver, Colorado for any dispute arising under this Term Sheet.

(d)         Succession and Assignment. This Term Sheet is binding upon and will inure to the benefit of the Parties and their successors and assigns. No Party may assign this Term Sheet or any of its rights, interests, or obligations hereunder.

(e)          Invalid Provisions; Severability. If a dispute between the Parties arises out of this Term Sheet or the subject matter of this Term Sheet, the Parties would want a court or arbitrator to interpret this Term Sheet as follows:

(a)        With respect to any provision held to be unenforceable, by modifying that provision to the minimum extent necessary to make it enforceable or, if that modification is not permitted by law or public policy, by disregarding the provision;

(b)        if an unenforceable provision is modified or disregarded in accordance with this Section by holding the rest of the Term Sheet will remain in effect as written;

(c)        by holding that any unenforceable provision will remain as written in any circumstances other than those in which the provision is held to be unenforceable; and

(d)        if modifying or disregarding the unenforceable provision would result in a failure of an essential purpose of this Term Sheet, by holding the entire Term Sheet unenforceable.

Upon the determination that any term or other provision of this Term Sheet is invalid, illegal or incapable of being enforced, the Parties shall negotiate in good faith to modify this Term Sheet so as to effect the original intent of the Parties as closely as possible in an acceptable manner to the end that the transactions contemplated hereby are fulfilled to the extent possible.

(f)        Counterparts/Electronic or Fax Signatures. This Term Sheet may be executed in counterparts, each of which will be an original and all of which, when taken together, will constitute one instrument notwithstanding that all Parties have not executed the same counterpart. Signatures that are transmitted electronically or by fax will be effective as originals.

(g)        Attorney’s Fees. If a Party brings an action to enforce the terms of this Term Sheet, the substantially prevailing Party in such action will be entitled to an award of its reasonable attorney’s fees and costs incurred in connection therewith.

[Signature page follows.]

IN WITNESS WHEREOF, the Parties have executed this Term Sheet as of the date first set forth above.

ROYAL ASSET MANAGEMENT, LLC

/s/ Neil Demers

Neil Demers, Manager

VENTURE PRODUCT CONSULTING, LLC

/s/ Neil Demers

Neil Demers, Manager

DIEGO PELLICER WORLDWIDE, LLC

/s/ Nello Gonfiantini

Nello Gonfiantini, CEO

EXHIBIT A 

RAM CONFESSION 

(see attached)

EXHIBIT B

VPC CONFESSION

Exhibit 99.1

COME NOW Plaintiff Diego Pellicer Worldwide, Inc., by and through its attorneys Furtado Law PC, and submits its complaint and jury demand against the above-named Defendants Royal Asset Management, LLC and Neil Demers, as follows:

I.      PARTIES, JURISDICTION, AND VENUE

1.           Plaintiff Diego Pellicer Worldwide, Inc. (“Diego Pellicer”), is a Delaware corporation that executed commercial leases and a promissory note with Defendant Royal Asset Management, LLC. The commercial leases and the promissory note were executed in Colorado, is governed by Colorado law and pertains to property in Colorado.

2.          Upon information and belief, Defendant Royal Asset Management, LLC, (“RAM”) is a Colorado limited liability company with its principal place of business located at 2949 West Alameda Avenue, Denver, CO 80209 and RAM is authorized to do business in Colorado. Neil Demers is the managing member of RAM.

3.           Upon information and belief, Defendant Neil Demers is an individual, upon information and belief, is a Colorado resident.

4.           This Court has jurisdiction over the subject matter of this action and the parties hereto.

5.           Venue is proper in this Court pursuant to C.R.C.P. 98(c)(1).

II.     FACTUAL ALLEGATIONS

6.           On or about July 14, 2014, Diego Pellicer entered into a lease agreement (hereinafter the “Alameda Lease”) with 2949 Alameda, LLC for property located at 2949 W. Alameda Avenue, Denver, CO 80219 (hereinafter the “Alameda Property”).

7.           On or about September 8, 2015, Diego Pellicer entered into a sublease agreement (“hereinafter the “Alameda Sublease”) with RAM for the Alameda Property.

8.           On or about August 1, 2016, Diego Pellicer and 2949 Alameda, LLC executed a first amendment to the Alameda Lease with minor term changes.

9.           On or about August 1, 2018, Diego Pellicer and RAM executed a first amendment to the parties’ sublease. The parties further modified the sublease on December 3, 2018. For the December modification, Diego Pellicer and RAM agreed to extend the term of the sublease until February 29, 2020.

10.         On or about July 31, 2019, Diego Pellicer and 2949 Alameda, LLC executed a second amended to the Alameda Lease with a change to the base rent term.

11.         On or about July 31, 2019, Diego Pellicer also amended its sublease with RAM extending the term of the lease by seven months and acknowledging RAM’s execution of its term extension until February 28, 2015. The sublease also stated that RAM would incur a renewal fee of $100,000.00 if the sublease was terminated early.

12.         Upon information and belief, although Diego Pellicer executed the above agreements with RAM in good faith of future payment from RAM, RAM has failed to pay any amounts under the Alameda Sublease terms and RAM has breached the agreement.

13.         At all times relevant, Diego Pellicer never agreed to forgive any debt of RAM and all agreements above are in fact made with the assumption that any and all debts due and owing were carried over to the subsequent amended agreements.

14.         Upon information and belief, as of March 2, 2021, RAM owed Diego Pellicer $648,531.00 in deferred late rents, $100,000.00 in licensing fees, $395,000.00 in settlement amounts and $337,050.00 in future premiums rent for the Alameda property address pursuant to the Alameda Lease terms. Therefore, RAM has failed to timely pay $1,480,581.00 under the Alameda Lease terms and is in breach of contract.

15.         As a result of RAM’s breach of the Alameda Sublease agreement terms and conditions, Diego Pellicer has incurred damages in an amount to be determined by the trier of fact.

16.         On or about August 1, 2015, Diego Pellicer as lessee and William P. Vassil, James J. Domenico and James Street, LLC as Lessor executed a lease agreement (hereinafter the “Jason Lease”) for property located at 755 S. Jason St. Unit 150, Denver, CO 80223 (hereinafter the “Jason Property”).

17.         On or about August 1, 2015, Diego Pellicer and RME Group, LLC also executed a sublease agreement (hereinafter the “Jason Sublease”) for the Jason Property. The agreement proscribed various rental payment terms and prices and RME Group, LLC agreed to pay triple net charges (hereinafter referred to as “NNN”) per month for the Jason Property.

18.         On or about October 14, 2015, Diego Pellicer as lessee and William P. Vassil, James J. Domenico and James Street, LLC as Lessor executed an assignment and addendum to the Jason Lease. In the assignment Diego Pellicer assigned his tenant rights and interest to DPOC Jason, LLC.

19.         On or about July 15, 2017, RME Group, LLC sold its ownership of assets, licenses and sublease interests to RAM.

20.         On or about October 4, 2017, Diego Pellicer as sublessee, RME Group, LLC and RAM as sublessor executed an amended sublease agreement to the Jason Sublease. In the agreement RAM agreed to take over RME Group, LLC’s position as sublessor of the original September 8, 2015, sublease for the Jason Property.

21.         Upon information and belief, although Diego Pellicer executed the above agreements with RAM in good faith of future payment from RAM, RAM has failed to pay any amounts under the Jason Sublease terms and RAM has breached the agreement.

22.          At all times relevant, Diego Pellicer never agreed to forgive any debt of RAM and all agreements above are in fact made with the assumption that any and all debts due and owing were carried over to the subsequent amended agreements.

23.          Upon information and belief, as of March 2, 2021, RAM owed Diego Pellicer $356,080.00 in addition to future premium rent of $21,488.00 related to the Jason Sublease.

24.          As a result of RAM’s breach of the Jason Sublease agreement terms and conditions, Diego Pellicer has incurred damages in an amount to be determined by the trier of fact.

C.     Property Located at 4242 Elizabeth Street, Denver, CO 80216

25.          On or about June 12, 2014, Diego Pellicer and Colorado Group Trust f/k/a Shamira, LLC (hereinafter “CGT”) executed a lease agreement (hereinafter the “Elizabeth Lease”) for property located at 4242 Elizabeth Street, Units 1-3, Denver, CO 80216 (hereinafter the “Elizabeth Property”).

26.          On or about September 4, 2015, Shamira, LLC assigned and transferred all of its rights, title and interest in the Elizabeth Property to CGT.

27.          On or about October 23, 2015, Diego Pellicer and CGT executed an amendment to the Elizabeth Lease removing Shamira, LLC as the Landlord of the Elizabeth Property.

28.          On or about September 8, 2015, Diego Pellicer and RAM executed a sublease agreement (hereinafter the “Elizabeth Sublease”) for the Elizabeth Property.

29.          On or about December 30, 2015, Diego Pellicer, RAM and Ventura Product Consulting, LLC executed an amended to the sublease for unit 2 only of the Elizabeth Property. In the amendment to the sublease, Venture Product Consulting, LLC agreed to take over the sublease for unit 2 only.

30.          On or about September 19, 2017, Diego Pellicer and Venture Product Consulting, LLC executed a second amendment to the Elizabeth Sublease. The agreement made minor pricing terms for 2018 and Diego Pellicer agreed that all past due amounts with Venture Product Consulting, LLC through December 31, 2017, were settled.

31.          On or about October 21, 2020, Diego Pellicer and CGT terminated the Elizabeth Lease.

32.          Upon information and belief, although Diego Pellicer executed the above agreements with RAM in good faith of future payment from RAM, RAM has failed to pay any amounts under the Elizabeth Sublease terms and RAM has breached the agreement.

33.          Furthermore, at all times relevant, Diego Pellicer never agreed to forgive any debt of RAM but instead Diego Pellicer and RAM agreed to convert RAM’s debt obligation for unpaid deferred rent into a promissory note. The parties made this agreement on or about October 1, 2020.

34.          Upon information and belief, despite this agreement, RAM has also failed to pay any amount toward the $1,418,480.00 promissory note.

35.          Upon information and belief, as of March 2, 2021, RAM owed Diego Pellicer $1,418,480.00 pursuant to an overdue note, $100,000.00 in licensing fees, $395,000.00 in settlement amounts and $532,634.78 in future premiums rent for the Elizabeth property address pursuant to the Elizabeth Lease terms.

36.          As a result of RAM’s breach of the Elizabeth Sublease agreement terms and conditions and failure to pay the promissory note principal balance, Diego Pellicer has incurred damages in an amount to be determined by the trier of fact.

D.    Promissory Note

37.          Upon information and belief, RAM also entered into a secondary promissory note with Diego Pellicer on April 3, 2018. The sum of the promissory note was $330,000.00 with an eighteen percent per annum interest rate. The outstanding principal and accrued interest were due and payable in full on April 2, 2019.

38.          Upon information and belief, Neil Demers is a personal guarantor of the promissory note.

39.          Upon information and belief, the amount now due under the note is $502,829.59.

40.          Upon information and belief, due to RAM’s words and conduct, RAM has shown a lack of intent to honor the note also.

41.          As a result of RAM’s failure to pay the note, Diego Pellicer has incurred damages in an amount to be determined by the trier of fact.

III.      FIRST CLAIM FOR RELIEF 

(Breach of Contract-Alameda Sublease)

42.          Diego Pellicer incorporates by reference the allegations contained in paragraphs 1-41 as though fully set forth herein.

43.          As stated above, Diego Pellicer and RAM entered into the Alameda Sublease.

44.          Under the terms of the Alameda Sublease, which RAM benefited from, RAM had a contractual duty to pay various forms of rent including deferred rent, licensing fees.

45.          As stated above, due to RAM’s breach of the Alameda Sublease’s terms and conditions in failing to make any payments thereunder, RAM owes Diego Pellicer $648,531.00 in deferred late rents and premium rents, $100,000.00 in licensing fees, $395,000.00 in settlement amounts and $337,050.00 in future premiums rent.

46.          Therefore, RAM has failed to timely pay $1,480,581.00 under the Alameda Sublease terms and is in breach of contract.

47.          Diego Pellicer also continues to incur damages in an amount to be determined by the trier of fact.

IV.      SECOND CLAIM FOR RELIEF

(Breach of Contract-Jason Sublease)

48.          Diego Pellicer incorporates by reference the allegations contained in paragraphs 1-47 as though fully set forth herein.

49.          As stated above, Diego Pellicer and RAM entered into the Jason Sublease.

50.          Under the terms of the Jason Sublease, which RAM benefited from, RAM had a contractual duty to pay various forms of rent including deferred rent, licensing fees.

51.          As stated above, due to RAM’s breach of the Jason Sublease’s terms and conditions in failing to make any payments thereunder, RAM owes Diego Pellicer $356,080.00 in deferred rent and premium rents, and $21,488.00 in future premium rent.

52.          Diego Pellicer also continues to incur damages in an amount to be determined by the trier of fact.

V.       THIRD CLAIM FOR RELIEF 

(Breach of Contract-Elizabeth Sublease and Promissory Note)

53.          Diego Pellicer incorporates by reference the allegations contained in paragraphs 1-52 as though fully set forth herein.

54.          As stated above, Diego Pellicer and RAM entered into the Elizabeth Sublease.

55.          Under the terms of the Elizabeth Sublease, which RAM benefited from, RAM had a contractual duty to pay various forms of rent including deferred rent, licensing fees.

56.          As stated above, due to RAM’s breach of the Jason Sublease’s terms and conditions in failing to make any payments thereunder, RAM owes $100,000.00 in licensing fees, $395,000.00 in settlement amounts and $532,634.78 in future premiums rent.

57.          Upon information and belief, this demand for payment was made on March 2, 2021.

58.          Upon information and belief, although RAM received a written notice to terminate and demand for payment, RAM still has made no payments towards money owed under the Elizabeth Sublease.

59.          Diego Pellicer also continues to incur damages in an amount to be determined by the trier of fact.

VI.       FOURTH CLAIM FOR RELIEF

(Breach of Contract – Promissory Note Re to Elizabeth Property Address)

60.          Diego Pellicer incorporates by reference the allegations contained in paragraphs 1-52 as though fully set forth herein.

61.          As stated above, due to RAM’s failure to pay deferred rent payments for the Elizabeth sublease, the parties made a further agreement to convert RAM’s overdue rent payments into a promissory note in the amount of $1,418,480.00.

62.          The promissory note was not personally guaranteed by Neil Demers.

63.          As stated above, RAM has failed to make any payments due and owing under the promissory note terms and RAM is in breach of contract.

64.          As a result of the breach, Diego Pellicer continues to incur damages in an amount to be determined by the trier of fact.

VII.       FIFTH CLAIM FOR RELIEF

(Breach of Contract-Promissory Note)

65.          Diego Pellicer incorporates by reference the allegations contained in paragraphs 1-64 as though fully set forth herein.

66.          As stated above, Diego Pellicer and RAM entered into a promissory note dated April 3, 2018.

67.          The promissory note was for the principal amount of $330,000.00 with an interest rate of 18% per annum.

68.          Defendant Neil Demers personally guaranteed the note with a personal guaranty.

69.          The promissory note had a maturity date of April 2, 2019.

70.          RAM is liable for the total balance of the promissory note in addition to interest on the balance of the promissory note accruing at 18% per annum from April 3, 2018.

71.          Further, due to RAM’s breach of the promissory note, Diego Pellicer continues to incur damages in an amount to be determined by the trier of fact.

VIII.     SIXTH CLAIM FOR RELIEF 

(Breach of Contract-Promissory Note-Personal Guaranty-Neil Demers)

72.          Diego Pellicer incorporates by reference the allegations contained in paragraphs 1-40 as though fully set forth herein.

73.          As stated above, Diego Pellicer and RAM entered into a promissory note dated April 3, 2018.

74.          The promissory note was for the principal amount of $330,000.00 with an interest rate of 18% per annum.

75.          Defendant Neil Demers personally guaranteed the note with a personal guaranty.

76.          The promissory note had a maturity date of April 2, 2019.

77.          Neil Demers is liable for the total balance of the promissory note in addition to interest on the balance of the promissory note accruing at 18% per annum from April 3, 2018 as he guaranteed the promissory note.

78.          Further, due to RAM’s breach of the promissory note, Neil Demers is personally liable for the amounts due under the terms of the promissory note.

79.          Diego Pellicer continues to incur damages in an amount to be determined by the trier of fact.

DIEGO PELLICER DEMANDS A TRIAL BY JURY AT THIS TIME

WHEREFORE, Plaintiff requests this Court enter judgment in its favor and against Defendants as follows:

Respectfully submitted this 28^th day of July 2021.

Exhibit 99.2

Exhibit 99.3